TORONTO – Led by gains in its wireless and cable division, Rogers Communications saw third quarter profits jump 17%, the company said Friday.
Rogers posted net income of $594 million for the three months ended September 30, up from $508 million in the same period a year ago. The Toronto-based company said that net income and adjusted net income increased this quarter by 17% and 13%, respectively, as a result of higher adjusted EBITDA, partially offset by the higher associated income tax expense and higher depreciation and amortization.
Total revenue increased 3% to $3.77 billion this quarter, largely driven by Wireless service revenue growth of 5%. Rogers attributed the growth in Wireless to its balanced approach to continue monetizing the increasing demand for data along with a disciplined approach around subscriber base management. Wireless equipment revenue grew 11% this quarter driven by increased hardware upgrades. Cable revenue increased 1% this quarter as Internet revenue growth of 8%, (helped by 35,000 net additions), continued to drive the Cable segment. Media revenue decreased 5% this quarter primarily as a result of lower revenue at the Toronto Blue Jays.
“We delivered strong results and continued momentum in the third quarter," said president and CEO Joe Natale, in the company’s Q3 press release. "In Wireless, we delivered excellent financials and the best Q3 postpaid churn in nine years. In residential, we delivered solid Internet growth and launched our market awareness campaign for Ignite TV, our world-class all-IPTV service that is truly unmatched in our market today. We are pleased with our progress and confident in the future of this roadmap. Given our strong year to date performance, we are raising our full-year guidance."
Rogers increased its full-year 2018 guidance for adjusted EBITDA growth to 7% to 9% (up from 5% to 7%) and for free cash flow growth to 5% to 7% (up from 3% to 5%). Its guidance ranges for revenue and capital expenditures remain unchanged.
The company added 124,000 new postpaid wireless subscribers to end the quarter with 9.04 million (up 206,000 year-over-year), plus added 60,000 new prepaid customers for a total of 1.76 million (down 21,000 from Q3 last year), at quarter end. In addition, postpaid churn of 1.09% was the best third quarter result since 2009.
On the TV side, Rogers lost 18,000 cable customers for a total of 1.70 million; added 35,000 Internet customers to sit at 2.40 million broadband subs; while home phone customers were flat at 1.12 million households.
Total service units, which includes Internet plus Smart Home Monitoring subscribers, as well as television and phone, totaled 5.23 million at quarter end.
Rogers’ full third quarter financial report is available here.
