Cogeco still waiting on MVNO terms and conditions, reports increase in Q2 revenue and profits

Cogeco Inc. is preparing its entry into Canada’s mobile wireless market but has no definitive timeframe, as it is still contingent on the approval by the CRTC for the terms and conditions for the mobile virtual network operator (MVNO) service and the negotiation of reasonable rates with the incumbents. CEO Philippe Jetté told analysts in a Thursday morning quarterly earnings call that Cogeco is “still awaiting, like everybody else, the results of the terms and conditions from the CRTC.” “They have not released anything to anyone,” he said. Cogeco’s net profit increased by 7.8 per cent in its second quarter for a total of $118.8 million and reported $748.1 million in revenues, accounting for a 14.5 per cent increase for the three months ending on Feb. 18, 2022. Cogeco Connexion, the company’s Canadian operations, saw a revenue increase of 2.1 per cent compared to this time last year, for a total of $362.3 million . Jetté said a transaction between the company and Arsenal Media – which would essentially see the two companies swap several radio stations in Quebec – is expected to close by the end of the month. Cogeco saw a decline in its Canadian customer base for both its video and telephony services. The former saw a decline of 5,152 customers, comparable to the losses during this time last year, for a total of 667,629. Telephony saw a loss of 3,222 customers, for a total of 402,699, which is almost 1,000 less than it lost during last year’s second quarter. The change in the video consumption environment, as more consumers turn to only internet services, is responsible for the losses in video consumers. Telephony saw a decline due to the increased movement toward the mobile wireless market by consumers. Internet service customers rose by 2,739 for a total of 921,043. Last year's second quarter saw 4,431 new customers in the internet division. The pandemic, which saw a lot of new customers interested in high-speed options, accounted for the larger jump in consumers seen last year. In the U.S., Cogeco’s Breezeline (formerly known as Atlantic Broadband) revenue increased by 31.3 per cent – mainly due to the acquisition of WideOpenWest Inc.’s Ohio broadband system – for a total of $366.2 million. Jetté told analysts that the integration of both Ohio broadband systems is progressing “very well” and the migration of the customer management systems now expected to be completed at the beginning of the fourth quarter. “Our next steps will then be to further interconnect the Ohio network with the existing Breezeline network and prepare for the launch of our IPTV platform in this market,” he said. Trends for its customer base were similar to those for its Canadian operations. The internet division had a 2,830 increase in customers for a total of 719,608 while video and telephony saw a decline of 7,708 and 3,830 respectively for a total of 339,021 and 169,221. – Reporting by Jenna Cocullo at jcocullo@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca

Cogeco still waiting on MVNO terms and conditions, reports increase in Q2 revenue and profits

Broadcast | April 14, 2022

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