Rogers’ profit growth below expectations due to slowing mobile take-up

27 Apr 2006

Rogers Communications, Canada’s largest mobile operator, has posted a first quarter profit of CAD14.8 million (USD13 million), falling short of analysts’ forecasts after cellular subscriber growth slowed. The Toronto-based group, which provides a full range of fixed line, cable, mobile and broadband services, reported that 1Q net income was CAD0.05 per share, compared with a loss of CAD0.17 a share a year earlier when it posted quarterly losses of CAD46 million. 1Q revenues jumped 28% year-on-year to CAD2.03 billion, with wireless revenue up 20% to CAD1.05 billion. Rogers’ mobile customers, which accounted for more than half of sales, rose by only 0.4%, or 89,600, to 6.2576 million, compared with growth of 7.2% in the corresponding period last year. Rogers predicted in February that cellular turnover will increase by no more than 16% percent in 2006, around a third of last year’s pace, after it scrapped user discounts. Elsewhere, Rogers added 48,700 phone-over-cable subscribers in the quarter and another 11,400 Call-Net landline phone users, and ended the period with a total of nearly half a million local phone subscribers. Cable and fixed telecoms revenues rose 53% to CAD774 million because of the purchase of Call-Net in July 2005, which gave Rogers around 600,000 extra customers at the time.

Canada, Rogers Communications