TORONTO – Competition continued to weigh on Rogers, pulling down second quarter profits and holding revenues flat.
Consolidated financial results released Tuesday for the three months ended June 30, saw revenue of $3.12 billion virtually unchanged from $3.10 billion in same period last year, while profits dipped 2% to $400 million from $410 million.
Wireless activated and upgraded approximately 629,000 smart phones this quarter, predominantly iPhone, BlackBerry and Android devices, of which approximately 36% were for new subscribers. This means that smart phone subscribers now represent 63% of the company’s overall postpaid subscriber base, up from 48% in the same period last year, while wireless data revenue now comprises 39% of Wireless network revenue, up from 35%.
The division recorded an operating profit of $782 million, a 5% increase from $744 million year-over-year.
Rogers Cable saw its operating profit grow 3% to $396 million from $385 million in 2011. The division ended the period with 2.25 million total cable subscribers (down 21,000 from the same period last year), 1.78 million digital cable customers, 1.82 million Internet customers, and 1 million cable telephony lines.
Rogers Media reported a 1% increase in operating revenue which it attributed to growth in the Sports Entertainment division's baseball ticketing and merchandising revenue, combined with increased subscriber fees and advertising sales generated from Sportsnet. Operating profit fell 11% from $82 million to $73 million.
“Our revenue and adjusted operating profit growth in the second quarter was highlighted by strong postpaid wireless smart phone sales and customer retention metrics, as well as exceptionally strong margins in both our wireless and cable businesses," said president and CEO Nadir Mohamed, in a release.
"Despite highly competitive markets, we continued to leverage our technology leadership to deliver new and innovative products and services while at the same time taking decisive actions to drive operational efficiencies. Importantly, our continued generation of strong free cash flow enabled us to return a significant and growing amount of cash to our shareholders in the form of dividends and share buybacks."
