Best ever postpaid churn rate
TORONTO – Slowing wireless equipment sales and a dip in its media division revenues took a bite out of Rogers’ first quarter revenues and profits, the company said Thursday.
For the period ended March 31, total revenue decreased 1% to $3.59 billion, largely driven by 12% drops in both Wireless equipment revenue and Media revenue. Rogers said that declining Wireless equipment revenue was primarily a result of its “disciplined approach to postpaid subscriber loading this quarter”, whereas Media revenue fell year-over-year due to a distribution from Major League Baseball in the first quarter of 2018.
These declines were partially offset by strong service revenue growth of 4% in Wireless, where blended ARPU continued to increase year on year for the twelfth consecutive quarter, and 1% in Cable, where Internet revenue growth of 7% continued to drive this segment. Overall, total service revenue increased by 1% this quarter.
Net income and adjusted net income fell by 8% and 15% to $391 million and $405 million, respectively, primarily as a result of the baseball-related transactions. Excluding the impacts of these transactions, net income would have increased by 10% and adjusted net income would have remained stable.
The company ended the quarter with 9.18 million wireless postpaid customers and 1.57 million prepaid customers, up 23,000 and down 56,000, respectively, from the same period last year. Rogers said that its postpaid churn of 0.99%, which was 0.09 points lower than the same period last year, was its best postpaid churn result ever.
“We believe the lower postpaid churn this quarter was a result of our strategic focus on enhancing the customer experience by improving our customer service and continually increasing the quality of our network,” reads the earnings report.
Rogers’ Q1 2019 blended average billing per user was $64.62, a $1.95 increase from the $62.67 that it reported in the same period in the prior year.
On the TV side, Rogers lost 28,000 cable customers to fall to 1.66 million; added 14,000 Internet customers to sit at 2.44 million broadband subs; and lost 10,000 home phone customers and now has 1.11 million of those households.
"In the first quarter, we delivered strong growth in service revenue and adjusted EBITDA in both Wireless and Cable. We achieved the best Wireless postpaid churn in our company's history and continued to deliver on ARPU growth," said president and CEO Joe Natale, in the report. "These solid results are underpinned by our strong balance sheet and we used this strength to actively return cash to shareholders through the repurchase of $155 million of shares, our first buyback since 2013. This strength also allowed us to secure strategic 5G spectrum for our customers in every province and territory. Overall, we have confidence in our long-term growth plans, and remain on track to deliver on our healthy outlook for 2019."
Rogers’ first quarter report is available here.
