Calgary-based Shaw Communications reported Tuesday net income of $155 million for its second quarter of operations in its fiscal year 2019 compared with a net loss of $175 million a year ago.
The company’s quarter ended February 28, 2019.
It said consolidated revenue decreased by one per cent to $1.32 billion compared to the second quarter in fiscal 2018 and operating income before restructuring costs and amortization increased 13.7 per cent year-over-year to $549 million.
In the second quarter of fiscal 2019, approximately 200 employees left the company, bringing the total number of employees who departed under the Voluntary Departure Program to over 1,700 since the program started in March 2018. This led to operating cost savings of approximately $27 million and capital cost savings of approximately $6 million in the quarter, it said.
“We continue to make progress on our strategic priorities and journey to a modern Shaw. Second quarter results include stable Wireline performance, improved broadband execution and solid subscriber growth in our Wireless business. While we still have lots of work ahead of us, our second quarter and year-to-date results reflect improvement on all these initiatives, combined with a meaningful reduction in our cost structure that resulted in strong margin performance in the quarter,” said Brad Shaw, Chief Executive Officer, in a statement.
The company said wireless results include postpaid net subscriber additions of approximately 65,000, bringing the total Freedom Mobile customer base to over 1.5 million as of the end of February. It said it launched wireless services in several new markets including Victoria and Red Deer on February 8 and an additional six communities in Eastern Ontario in early March.
“Freedom Mobile will continue to launch in new markets throughout fiscal 2019, primarily in Western Canada. Continuous network enhancements, including the deployment of 700 MHz spectrum, remain a priority as network quality contributes to the significant postpaid churn reduction, which improved approximately 30 basis points year-over-year to 1.36 per cent in the quarter. Subsequent to the quarter end, the Company finalized an agreement with its third national retail partner, Mobilinq, and expects to launch prepaid services throughout the 50 additional locations beginning in April,” it added.
“Our Wireless subscriber and financial performance in fiscal 2019 reflects the execution of our strategic priorities,” said Brad Shaw. “We continued to attract high quality subscriber growth in the second quarter against the backdrop of a less active market compared to a year ago, when we saw record subscriber performance for the Company as the iPhone became available for Freedom Mobile customers and we launched our Big Gig data plans.
“At the same time that we are growing our subscriber base, we are also improving the profitability of our Wireless business, with operating income before restructuring and amortization improving to $52 million this quarter. Our network investments are clearly paying off and, while our focus remains on growing our postpaid subscriber base, we have recently introduced refreshed prepaid plans to participate more effectively in this competitive segment of the market.”
Mario Toneguzzi is a Troy Media business reporter based in Calgary.