WINNIPEG – "MTS has now delivered two solid quarters of performance in 2006," said Pierre Blouin, CEO of MTS Allstream in releasing the company’s second quarter results Thursday afternoon.
"The second quarter results reflect strong growth in wireless, digital television, next generation data connectivity and high-speed Internet, solid improvements at our enterprise solutions division, marked by a sequential improvement in quarterly profitability, and continued strong progress with our cost reduction program."
The company’s results from continuing operations include: flat EBITDA of $175.4 million compared with $175.9 million in the second quarter of 2005; a marginal year-over-year decline in revenues by approximately 2% to $490.1 million in the second quarter and by 2% to $978.9 million in the six months ended June 30, 2006; and free cash flow up strongly in the quarter by 37% to $99.3 million and by 24.1% to $191.8 million in the first half of the year.
"Underlying the stability of these consolidated financial results was excellent progress on the company’s $100 million cost reduction program," says the press release. "At June 30, 2006, work had been completed to achieve $70 million in annualized savings. Realized savings were $26 million in the second quarter and $48 million in the first six months of the year. The company’s growth services, also posted very strong performance, collectively increasing by 15%, representing $44 million in new revenues in 2006.
Part of that $100 million in savings announced last fall included the cutting of 800 jobs.
Other revenues climbed by 15.3% to $28.7 million in the second quarter of 2006 from $24.9 million in 2005, and on a year to date basis, from $47.5 million to $56.7 million. These increases were primarily due to strong revenue growth from digital television services and equipment sales, said the company.
For the six months ended June 30, 2006, digital television revenues increased by 47.5% to $14.9 million. This increase reflects strong year-over-year growth in customers, as well as price increases and revenues from video on demand services. Its MTS TV subscriber base increased to 56,571 as at June 30, 2006, representing an increase of 36.8% over Q2 ’05.
