MONTREAL – Cogeco Inc. will raise its 2010 financial targets thanks in large part to steady growth at its Canadian cable operations.
For the first quarter ended November 30, 2009, Cogeco said that revenue increased by 6% to reach $317.4 million, and operating income before amortization grew 5.9% to top $122.6 million.
Net income amounted to $56.7 million. Excluding a favourable income tax adjustment related to the reduction of Ontario provincial corporate income tax rates, net income would have amounted to $26.9 million, a 17.2% increase compared to the first quarter of fiscal 2009.
The company now anticipates that annual revenue for its fiscal year will reach $1.29-billion, up $40-million from its previous $1.25-billion projection.
The consolidated number of revenue generating units (RGUs) in the Portuguese and Canadian cable sector reached 2,982,023, up 89,785 during the quarter. RGUs represent the total of basic cable, digital cable, high speed Internet and telephony service customers.
In Canada, the number of RGUs increased 3.1% during the quarter to 2,982,023. From September to November, Cogeco gained 8,919 basic cable customers, 17,506 new high speed Internet customers, 16,106 new digital cable subscribers and 20,641 new telephone subscribers.
“Our Canadian operations have grown at a steady pace, as demonstrated by net additions of 63,172 RGU”, said president and CEO Louis Audet, in a statement. “In our European operations, the first quarter results evidence that our customer base has begun to stabilize as a result of the customer retention and acquisition plans implemented in response to the difficult competitive environment experienced in the prior year, with a growth of 26,613 RGU”.
Driven by RGU increases, the introduction of high speed Internet usage billing, and rate increases implemented at the end of fiscal 2009, first-quarter Canadian operations revenue increased by $27 million (11.4%) over the comparable period of the prior year. Revenue at its European operations decreased by $9.1 million, or 14.6%, at $53 million, compared to the same period of the prior year.
