Rogers Communications sees profit decline

Canadian operator Rogers Communications has seen its profit fall year on year in the first quarter of 2014. While operating revenues remained stable; C$3.02bn (US$2.74bn) in 1Q14 compared with $3.03bn in the year ago quarter, adjusted net income for the quarter fell by 18 per cent to reach C$340m down from C$414m.

The decline in wireless was mainly related to pricing changes associated with more simplified plans and lower priced roaming plans. While cable revenue was flat as internet revenue growth was offset by television subscriber losses, promotional activity and the timing of pricing changes.

The firm did note however that adjusted operating profit from its wireless unit increased by three per cent during the quarter while postpaid churn also declined very slightly from 1.22 per cent to 1.2 per cent.

Rogers also reported that wireless data revenue grew by ten per cent year on year to exceed voice revenue for the first time. Wireless data revenue now represents approximately 51 per cent of total network revenue, the operator added.

“During the first quarter, we made a significant investment in ‘beachfront property’ 700MHz spectrum to give our customers an unsurpassed wireless experience, building on our unprecedented NHL rights deal late in 2013” said Guy Laurence, president and CEO at Rogers Communications. “We made these long-term strategic investments while maintaining our balance sheet at investment grade.”

Laurence added that he has identified a number of opportunities to improve the performance of the business over time, while also enhancing customer experience.

“As is apparent from our first quarter results, while there are some areas of strength, there are also areas where we clearly need to and will improve. Over the coming weeks I will be meeting with our Board and management team to lay out my plan and priorities for going forward. I remain excited about the opportunities I see in front of us for Rogers.”