TORONTO — Rogers Communications Inc.’s said Thursday that it fourth-quarter earnings got a boost from higher roaming revenue as travel bounced back and from improved returns from sports advertising and its Toronto Blue Jays franchise as activity normalized.
The telecom giant, which is waiting for a final decision on its $26 billion acquisition of Shaw Communications Inc., reported a fourth-quarter profit of $508 million, up from $405 million in the same quarter a year earlier as its revenue rose six per cent.
Company chief executive Tony Staffieri said the results are evidence of a turnaround, a year after he took the helm following a divisive boardroom fight.
“We have made significant progress, and we did it with a backdrop of a lingering pandemic, new executive team, and one of the largest proposed mergers in Canadian history.”
On the merger itself, the company is waiting only for a final decision from federal Industry Minister François-Philippe Champagne after other regulatory questions were settled in January.
Earlier this week, the companies involved in the Rogers deal to buy Shaw Communications extended the deadline to complete the transaction to Feb. 17.
Staffieri noted that two federal courts have now ruled in favour of the transactions, which include selling Shaw’s Freedom Mobile to a Quebecor Inc. subsidiary along with Rogers acquiring Shaw, but he said that given the matter is before the federal government he wouldn’t comment further on the state of the deal.
Company chief financial officer Glenn Brandt said the company has all the funding needed in place to close the deal, and that they have extended the $13 billion funding from issued bonds to the end of the year.
“We have plenty of runway there,” he said.
Acquisition aside, the company expects to continue its financial momentum in the year ahead. Rogers expects to see revenue increase between four and seven per cent, adjusted earnings growth before deductions of between five and eight per cent, while capital spending is expected between $3.1 billion and $3.3 billion, compared with $3.03 billion last year.
Capital spending last year was focused on investing in their networks, as they look to invest on expanding 5G network access as well as improve reliability, which became all the more important after a high-profile outage last summer.
Staffieri said the company is focused on dependability as critical to hold on to customers.
“Price is always important. The more important factor is the internet reliability, and that’s because even in the consumer space, with a lot of work from home, it’s become so critical.”
Turnover on wireless customers — a key metric in the telecom sector — was up in the last quarter compared with a year earlier but a higher overall number of customers, along with a 140 per cent jump in roaming revenue, helped boost service revenue by seven per cent in the quarter, while media revenue increased 17 per cent, largely from sports-related boost.
Overall revenue totalled $4.17 billion for the fourth quarter, up from $3.92 billion a year earlier.
Profit amounted to $1 per diluted share for the three months ended Dec. 31, up from 80 cents per diluted share in the fourth quarter of 2021.
On an adjusted basis, Rogers says it earned $1.09 per diluted share in its latest quarter, up from an adjusted profit of 96 cents per diluted share in the last three months of 2021.
This report by The Canadian Press was first published Feb. 2, 2023.
Companies in this story: (TSX:RCI.B, TSX:SJR.B, TSX:QBR.B)