Telus the good news: CEO admits poor quarterly performance

6 Aug 2007

Canadian telco Telus has reported that its EBITDA for the second quarter of 2007 was CAD884.6 million (USD837.3 million), down by CAD12.5 million compared to the same period in 2006, whilst net income decreased by CAD103.5 million year-on-year to CAD253.1 million, on revenues that increased 4% to CAD2.23 billion from a year ago due to continued wireless and internet/data services growth. The results were negatively impacted by increased wireless expenses in the first full quarter of mobile number portability (MNP) in Canada as well as increased wireline expenses from the implementation of a new billing system in Alberta, and Telus’s investment in the failed MVNO venture Amp’d Mobile, which recently entered into bankruptcy proceedings in the US. Darren Entwistle, Telus’s president and CEO, said: ‘I am less than satisfied with these quarterly results. While wireless revenue and subscriber growth of 11% and wireline data revenue growth of 8% remained robust, earnings did not meet expectations. This was largely caused by excess costs associated with the implementation of the new wireline billing and client care system as well as from the introduction of wireless number portability and the commercial failure of the launch of Amp’d.’

Telus’s total wireless subscribers stood at 5.27 million at 30 June 2007, up by 11.3% from 4.74 million a year earlier. High speed internet subscribers increased by 15.9% over the same period to reach 963,000, while total network access lines declined by 3.1% year-on-year to 4.48 million. Wireless monthly ARPU improved by 0.7% to CAD63.65, and data ARPU increased by 48% to CAD6.58, which more than offset the ongoing decline in voice ARPU. Wireline CAPEX in the second quarter was CAD308.7 million, down from CAD311.4 million in 2Q06, and wireless CAPEX was CAD173.1 million (CAD147.4 million).

Canada, Telus Corporation, Telus Mobility (old)