CALGARY – The global economic downturn hasn’t seemed to have taken much of a bite out of Shaw Communications.
The company today announced its third quarter results which showed healthy, near across the board growth in most metrics.
Consolidated service revenue for the three and nine month periods (ending May 31st) of $861 million and $2.52 billion, respectively, was up 9% and 10% over the same periods last year. Service operating income before amortization of $395 million and $1.14 billion, respectively, improved 11% and 10% over the comparable periods. Funds flow from operations increased to $356 million and $1 billion for the quarter and year-to-date periods, respectively, compared to $311 million and $902 million in the same periods last year.
Strong subscriber growth continued too, as basic cable subscribers increased 9,622 to 2,283,526, digital cable customers were up 110,810 to 1,187,183, and Internet and digital phone lines grew by 24,625 to 1,650,959, and 54,633 to 774,009, respectively. Shaw Direct DTH customers increased 1,580 to 898,213.
"The digital momentum started earlier this year continued with a record quarterly gain in digital customers of over 110,000. On a year-to-date basis we have added almost 280,000 digital customers increasing our penetration of basic from 40% at August 31, 2008 to 52%,” said CEO and vice-chair Jim Shaw in the press release.
Free cash flow for the quarter and year-to-date periods was $154 million and $406 million, respectively, compared to $81 million and $309 million for the same periods last year. The improvement in free cash flow was achieved through higher service operating income before amortization and after increased capital investment.
Net income of $132 million or $0.31 per share compared to $128 million or $0.30 per share for the same period last year. Net income for the first nine months of the year was $411 million or $0.96 per share compared to $539 million or $1.25 per share last year. The current nine month period included a tax recovery of approximately $23 million, while the comparable period included a tax recovery of approximately $199 million. These tax recoveries were primarily related to reductions in enacted income tax rates.
The prior nine month period also benefitted from a net duty recovery of approximately $22 million before income taxes related to the importation of satellite receivers. Excluding the non-operating items, net income for the current three and nine month periods ended May 31, 2009 would have been $131 million and $381 million compared to $117 million and $327 million in the same periods last year.
Service revenue in the cable division was up 10% and 11% for the quarter and year-to-date periods, respectively, to $670 million and $1.95 billion. The improvement was primarily driven by customer growth and rate increases. Service operating income before amortization improved almost 11% for the three and nine month periods to $325 million and $942 million, respectively.
Service revenue in the satellite division was $192 million and $569 million for the three and nine month periods respectively, up 4% and 5%, respectively, over the comparable periods last year. The improvement was primarily due to rate increases. Service operating income before amortization for the quarter increased 13% to $70 million, and the year-to-date was up 8% to $203 million.
"Strong subscriber growth and solid operational performance delivered financial results year-to-date that keep us on track to achieve our financial guidance for the year, including generating free cash flow of at least $500 million,” added CEO Shaw in the statement.
