Wireless expansion, new customers help Telus deliver strong results
Telus Corp. said wireless expansion helped it achieve almost double-digit earnings growth during this year’s second quarter compared with the same period in 2018.
Earnings before interest, depreciation and amortization, or EBITDA, increased by 9.8 per cent to $1.4 billion, the Vancouver-based company reported. Revenue rose by 4.2 per cent to $3.6 billion compared with a year ago, it said.
The company also credited growth on lower income taxes, “including a $121 million benefit from the revaluation of the deferred income tax liability for the multi-year reduction in the Alberta provincial corporate tax rate.”
New subscribers beat estimates, rising by a third to 186,000 during the three months. Wireless customer additions jumped 45 per cent to 154,000 including 82,000 mobile phones and 72,000 other mobile devices.
Darren Entwistle, president and chief executive, called the results “strong” because of “robust subscriber net additions,” and “customer loyalty.” Customer losses, or churn, was just 1.01 per cent in the wireless unit, helping the figure for mobile phone, internet and TV units hit 1.05 per cent, the company said.
Citibank analyst Adam Ilkowitz said while comparability remains an issue due to a different subscriber reporting methodology, “it would appear that promotional activity during the quarter helped Telus take market share.”
Desjardin analyst Maher Yaghi noted that pricing metrics were in line with expectations, they are still under pressure. Mobile phone average revenue per user, a key metric, was down 1.2 per cent due to competitive pressure as the company countered unlimited plans offered by rivals.