Rogers profit soars based off roaming and subscriber adds in second quarter

Rogers Communications Inc. reported a soaring profit margin for the company's second quarter, surprising analysts just weeks after a national outage put its networks and reliability in the national spotlight. The second quarter results reported Wednesday cover the three months that ended on June 30, and will not reflect any financial impacts of the July 8 outage. In response to analyst questions, Rogers CEO Tony Staffieri acknowledged that the company had seen an initial rise in subscriber churn in the days following the outage, but said that the impact has since moderated as Rogers moves to apply some $150 million in customer credit. "We did see an impact on our subscriber results, but we're encouraged by the patience our customers have shown...We're seeing very good trending on a daily basis," Staffieri said, adding that there is still about 80 per cent of third quarter activity to come. Overall revenues in the second quarter climbed eight per cent, up to $3.87 billion from $3.58 billion in the same quarter last year. Wireless revenues were up seven per cent, to $2.12 billion from $2.06 billion a year previous, while cable revenue climbed three per cent to $1.04 billion from $1.01 billion last year. Media revenues jumped 21 per cent, up to $659 million from $546 million this time last year. The company's net income stood out, showing a 35 per cent jump to $409 million from $302 million this time a year ago. "Rogers just reported a solid Q2 result with both financials and sub adds well ahead of Street expectations," Canaccord Genuity analyst Aravinda Galappatthige wrote in a Wednesday morning note. Staffieri attributed some of the increase to a strong return of roaming revenue from the company's wireless customers. "Clearly we are seeing Canadians embrace the return of travel, and our roaming revenue in Q2 has recovered to 130 per cent of the roaming revenue we saw in Q2 of 2019," the CEO told analysts on a Wednesday morning call. In wireless, the company also added 132,000 net postpaid subscribers, a 62 per cent jump from the 60,000 the company added for the same period last year, for a total of 9.04 million total post paid subscribers. Rogers also added 55,000 prepaid wireless subscribers, after having lost some 28,000 prepaid wireless subscribers in the second quarter of 2021. The company now has a total of 1.21 million prepaid subscribers. Average revenue per user for mobile phone also climbed six per cent, to $58.83 from $55.67 this time last year, mostly based off roaming revenue, according to the quarterly results. On the cable side, Rogers added 26,000 retail internet subscribers, up 12 per cent from the 14,000 the company added last year, for a total of 2.27 million subscribers. Rogers also added 21,000 video subscribers after having lost 4,000 a year ago, bringing the company to a total of 1.53 million. Rogers has also extended the deadline for the closure of its acquisition of Shaw Communications Inc. to December 31, accounting for the Competition Tribunal process currently underway. "Rogers and Shaw continue to pursue the divestiture of Freedom Mobile to Quebecor on the terms set out in the previously disclosed agreement. Negotiation of the definitive transaction documents are progressing, and the parties will provide an update in due course," the company wrote in a Wednesday release. – Reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca.

Rogers profit soars based off roaming and subscriber adds in second quarter

Broadcast | July 27, 2022

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Rogers profit soars based off roaming and subscriber adds in second quarter

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