CALGARY — Shaw Communications today released its financial results for its fourth quarter and fiscal year that ended August 31, 2022, reporting a 1.5% year-over-year (y-o-y) decline in quarterly revenue to $1.36 billion and a 1.1% y-o-y decrease in full-year revenue to $5.45 billion.
Shaw’s adjusted EBITDA increased by 1.6% to $624 million in Q4 2022 and by 1.4% to $2.53 billion in fiscal 2022, when compared to the same periods of fiscal 2021.
Funds flow from operations declined 5.3% to $487 million in the fourth quarter of 2022 and fell 11.4% to $1.99 billion for the full year, compared to 2021.
Shaw’s net income took a hit this year, decreasing y-o-y by 32.9% to $169 million in Q4 2022 and by 22.5% to $764 million for full-year fiscal 2022.
“Fiscal 2022 results include year-over-year growth in Consumer Internet, Wireless service and Business revenue, offset by declines in Wireless equipment and Wireline Video, Satellite and Phone revenue,” reads a press release announcing Shaw’s financial results.
“The prior year results included Consumer revenue of approximately $20 million related to the release of a provision following the Canadian Radio-television and Telecommunications Commission (CRTC) decision on final aggregated Third Party Internet Access (TPIA) rates and higher equity-based compensation costs of approximately $29 million due to the significant increase in Shaw’s share price following the Rogers-Shaw Transaction…announcement on March 15, 2021,” the release adds.
Speaking about the proposed merger of Rogers and Shaw and the related sell-off of Shaw-owned Freedom Mobile to Quebecor subsidiary Videotron, Shaw CEO and executive chair Brad Shaw is quoted in the release as saying “…it is so important to move forward with the transactions that Shaw, Quebecor and Rogers have agreed to in direct response to concerns raised by the Competition Bureau and ISED.
“Our proposed series of transactions creates an unprecedented opportunity to enable a strong, fourth wireless carrier that can compete at scale against the Big 3 and with 5G. The proposal also ensures that Shaw’s wireline business can make the significant investments it needs to remain competitive over the long term. In short, we are proposing a bright future for sustainable competition in Canadian telecommunications,” Shaw said.
“Instead of moving ahead with the investments and long-term planning that will drive more competition, we are unfortunately delayed by litigation with the Competition Bureau. Despite this, we remain optimistic that we will ultimately be able to complete our proposed transactions, and we are unwavering in our conviction that they represent a victory for all stakeholders, especially Canadian consumers. We maintain our strong commitment to the ongoing process, and to ensuring that Canada continues to have a vibrant and competitive industry with world leading infrastructure.”
In Q4 2022, Shaw added 52,862 new wireless customers, comprised of 25,623 postpaid and 27,239 prepaid net additions. Postpaid net additions in the quarter “were down compared to the prior year due to wireless competition and moderating demand for Shaw Mobile, partially offset by increasing retail traffic for Freedom Mobile, although not yet to pre-pandemic levels,” according to the press release.
For the full year, Shaw added 160,348 new wireless customers, bringing its total number of wireless subscribers to approximately 2.28 million as of the end of the fiscal year.
For the fourth quarter, Shaw’s wireless revenue increased 1.2% to $325 million and adjusted EBITDA grew 16% to $123 million, compared to Q4 2021. For the full 2022 fiscal year, wireless revenue increased 1.5% to $1.29 billion and adjusted EBITDA improved by 23.4% to $485 million, compared to fiscal 2021.
“Wireless service revenue for the three and twelve-month periods increased 7.3% and 9.1% respectively, to $250 million and $972 million, over the comparable periods in fiscal 2021 due to an increased subscriber base, partially offset by lower ARPU,” the release says.
“Wireless equipment revenue for the three and twelve-month periods decreased 14.8% and 16.3% respectively, to $75 million and $319 million over the comparable periods in fiscal 2021. Fourth quarter ARPU decreased 0.9% to $37.08 reflecting Shaw Mobile customer additions offset by lower device subsidy allocations. For the full year, ARPU of $36.83 decreased 1.4% over the prior year.”
Shaw reported consumer wireline subscriber losses in the fourth quarter of 2022 of approximately 42,500, which was a slight improvement over the prior-year period, according to the release. For the full year, Shaw saw a consumer wireline subscriber loss of 192,961, bringing its total consumer wireline base down to approximately 4.17 million at year end.
Shaw added 2,160 new business wireline subscribers in the fourth quarter of 2022, but reported a loss of 7,858 business subscribers for the full year. Shaw’s business wireline customers now total 641,737 as of the end of the year.
“Fourth quarter Wireline revenue of $1.03 billion and adjusted EBITDA of $501 million decreased 2.4% and 1.4% respectively. Consumer revenue of $879 million decreased 3.4% compared to the prior year as Internet revenue growth was offset by declines in Video, Satellite and Phone subscribers and revenue. Business revenue of $155 million increased 4.0% year-over-year with Internet revenue growth and continued demand for the Smart suite of products. The decrease in revenue was partially offset by lower employee related costs in the fourth quarter of fiscal 2022 compared to fiscal 2021 of approximately $11 million due to the impact of share price movements on stock-based compensation as well as favourable adjustments to employee benefit provisions based on experience,” the release says.
“For the twelve-month period, Consumer revenue decreased 3.2% to $3.55 billion and Business revenue increased 6.7% to $623 million resulting in Wireline revenue of $4.17 billion, or 1.9% lower than the prior year. Wireline adjusted EBITDA for the same period of $2.05 billion decreased 2.8% due primarily to lower Consumer revenue.”
Shaw’s capital expenditures in the fourth quarter of 2022 were $340 million, a 16.4% increase compared to its capital expenditures of $292 million in the same quarter of 2021. “Wireline capital spending increased by approximately $85 million primarily due to higher investments in network upgrades, enhancements and success-based categories as well as an increase in new housing development. Wireless spending of $34 million decreased by approximately $37 million year-over-year primarily due to lower planned investment in the quarter.”
Shaw’s consolidated capital expenditures in fiscal 2022 totalled approximately $1.1 billion, a 7.7% increase compared to the prior year.
For Shaw’s complete financial results for Q4 and full-year 2022, please click here.
