VANCOUVER – While revenue growth was flat and high speed Internet subscriber additions surprisingly low in the first quarter of 2010, ended March 31st, Telus still managed to please the street, thanks in part to a 5.3% increase in the dividend to shareholders and growth in other areas.
Over the 12 month period, total customer connections increased 2.4% or 276,000, driven by a 6.4% increase in wireless subscribers and 103% growth in Telus TV customers, partially offset by declines in legacy landline connections the company said in its quarterly report to shareholders on Wednesday. Telus now has over 200,000 TV customers with growth there driven by “improved installation capability, availability of high definition television channels and personal video recorders — and enhanced broadband coverage,” chief commercial officer Joe Natale explained to analysts during the company’s quarterly conference call on Wednesday.
On the wireless side for the company, revenues increased by 4.2% to $1.2 billion in the first quarter of 2010, compared to the same period in 2009, driven primarily by equipment and other revenue growth of $30 million, which included revenue from Black’s Photo, as well as a 1.6% increase in network revenue.
Data revenue of $258 million increased $50 million or 24% due to the continued adoption of smartphones and mobile Internet keys, and increased use of data services such as text messaging and wireless social networking.
Blended ARPU (average revenue per subscriber unit per month) declined by 4.4% to $55.80 compared to the same quarter a year ago. The downward trend in ARPU moderated from the 7.7% decline experienced in the fourth quarter of 2009. The improved trend is due to a lower rate of decline in voice ARPU and a higher rate of increase in data ARPU.
Total net subscriber additions of 51,000 increased by 6.3% over the same period a year ago. Higher value postpaid net additions increased 48% to 65,000, while prepaid subscribers decreased 14,000. As a result, postpaid subscribers represented 127% of aggregate net subscriber additions. Smartphone subscribers now represent 22% of total postpaid subscribers compared to 15% a year ago.
On the wired side of the company, revenues decreased by 3.8% to $1.2 billion in the first quarter of 2010, compared to Q1 ’09, primarily due to continued declines in traditional local and long-distance revenues.
Telus high-speed Internet net additions of 3,000 were down 11,000 from the same period a year ago, due to aggressive pricing and promotional activity in the quarter by the company’s primary cable-TV competitor, Shaw Communications.
Telus TV net additions were 29,000, an increase of 45% over the same period last year, due to improved installation capabilities, investment in expanded broadband coverage, and the addition of Telus Satellite TV service in mid-2009.
Watch for far more growth on this front too as the company says it will pass 90% of the homes in the top 48 communities with its broadband infrastructure by the end of 2010.
“We plan to push hard on the TV front,” added Natale.
