TORONTO – Rogers Communications saw its third quarter profits tumble 53% due to the wind down of its jointly owned shomi streaming service, the company said Monday, releasing its financial report three days earlier than planned.
For the period ended September 30, 2016, net income of $220 million fell from $464 million in the same period last year, while adjusted net income dropped from $472 million to $427 million as a result of higher other investment-related gains incurred in the prior year.
Consolidated revenue increased 3% this quarter to $3.5 billion, largely driven by growth in Wireless service and Media revenue of 6% and 13%, respectively. Wireless service revenue increased primarily as a result of a larger subscriber base and the continued adoption of higher-value Share Everything plans. Cable revenue decreased 1%, while continued double-digit Internet revenue growth of 11% partially offset the decline in Television and Phone revenue. Media revenue increased 13% primarily due to the company’s sports-related assets including Sportsnet, the World Cup of Hockey in September, and success of the Toronto Blue Jays.
Free cash flow of $598 million was down from $660 million last year, which the company said reflects an increase in adjusted operating profit and reduced additions to property, plant and equipment offset by an increase in cash tax payments due to a tax installment refund received during the third quarter of 2015 in connection with the acquisition of Mobilicity.
Rogers said that its Wireless division reported its highest service revenue growth and postpaid net additions since 2010, adding 114,000 postpaid net additions year-over-year.
The company ended the quarter with 8.46 million wireless postpaid customers and 1.68 million prepaid customers, up 224,000 and 1,000, respectively from the same period last year. On the TV side, Rogers lost 14,000 cable customers to fall to 1.83 million; added 39,000 Internet customers to sit at 2.11 million broadband subs; and added 5,000 home phone customers and now has 1.09 million of those households.
