CALGARY – Thanks to some accounting and tax changes, net income at Shaw Communications was $75.7 million for the first quarter, ended November 30, 2005 compared to net income of $44.7 million for the same quarter last year.
(The numbers include a tax recovery related to a reduction in enacted income tax rates as well as amounts related to the retroactive adoption of a Canadian accounting pronouncement. Excluding these non-operating items, net income for the quarter ended November 30, 2005 would have been $38.8 million compared to net income of $15.7 million last year.)
“Subscriber growth in the quarter in all products exceeded growth in the comparable quarter last year,” says the company’s press release. “Digital Phone lines grew 34,088 to 90,651 as at November 30, 2005 (which means the company has over 100,000 by now). Internet and digital TV subscribers were both up 4.7%, increasing by 54,724 and 28,296, respectively, and basic subscribers were up by 29,429 or 1.4% in the quarter. DTH customers increased 10,199 or 1.2%.
Total service revenue of $589.5 million for the quarter grew 9.8% over the comparable period. Consolidated service operating income before amortization of $255.3 million was 9.1% higher than the comparable period. Funds flow from operations increased to $197.2 million compared to $170.3 million in the same period last year.
Free cash flow for the quarter was $32.1 million compared to $26.9 million for the same period last year. The increase resulted from improved service operating income before amortization partially offset by higher capital expenditures.
"Following a year of solid growth we are off to a good start in the first quarter. Strong subscriber additions confirm that our focus on service and product enhancements is paying off" said Jim Shaw, CEO. "We remain on track to achieve our free cash flow range for the year of $200 – $210 million as announced in October.
"Both of our divisions are contributing to early success in fiscal 2006 through focused strategies related to growth and business improvements. We reached a key milestone yesterday with the launch of Digital Phone in Vancouver… and the coverage of homes passed is almost 50%, up from 35%. We are pleased with the customer response to date,” continued Shaw.
“Star Choice continues to focus on improvements in their business processes."
As a result of customer growth and rate increases, Cable division service revenue increased 11.7% for the quarter to $431.1 million (2004 – $386.0 million). Service operating income before amortization increased 7.2% to $207.5 million (2004 – $193.6 million).
Satellite division’s service revenue increased by 4.9% to $158.5 million for the quarter mainly due to rate increases.
