Rogers Communications Inc. delivered a 15 per cent profit increase in the first quarter, helped partly by more subscribers upgrading their smartphones while its television operations felt some pressure.
Net income rose to $414 million from $360 million, the Toronto-based telecommunications company said in an earnings report issued after stock markets closed Monday.
On an adjusted basis, earnings were 80 cents per share, beating expectations of 77 cents per share, according to a poll of analysts compiled by Thomson Reuters.
Revenue increased to $3.03 billion from $2.94 billion. Analysts had estimated revenue of $3.06 billion for the period.
More wireless customers
In its wireless division, 32,000 postpaid subscribers signed up in the quarter compared with 47,000 a year earlier.
Competition has been fierce in the wireless industry among Rogers, Bell, Telus and new players like Wind Mobile, Mobilicity and Public Mobile.
Rogers managed to come in with better results on ARPU, or average revenue per unit, an industry standard that calculates how much each subscriber is paying, said Troy Crandall, a tech analyst at MacDougall, MacDougall & MacTier. He said ARPU of $68.56 came in about $1 above his expectations.
"If you have a smartphone you're more apt to take a bigger-sized plan," he said.
Rogers president and CEO Nadir Mohamed called the results a "strong start" to the year, though there were signs of pressure in its cable results due to "aggressive pricing activity by our primary telco competitor."
Bell has been aggressively pushing its Bell Fibe TV product, which serves digital and high-definition channels through a fibre optic network, in major cities.
Mohamed said the company is pushing to add subscribers "in the face of these extremely deep discounts as we work through this period."
Loss of cable subscribers
Cable customers were down 87,000 from a year earlier, while the total has dropped 25,000 since end of the fourth quarter, the company said.
On a revenue basis, wireless network results were up four per cent as were cable results, though they were partly offset by a four per cent drop in the media division due to "the continued impact of a soft advertising market" and a tapering off of the fallout from the NHL lockout.
For its Internet division, subscribers grew by 26,000 to 1.9 million.
Rogers is Canada's largest cable TV and wireless operator, as well as TV and radio broadcaster and owner of the Toronto Blue Jays.
It also owns a slate of print magazines including Maclean's and Chatelaine.
Shares of Rogers closed up 32 cents to $52.08 on the Toronto Stock Exchange before the earnings report was announced.
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