SaskTel profits surge for 2015
Crown corporation credits maxTV, Internet and data revenue
With cost-cutting and modest growth in revenue, SaskTel posted net income of $97.7 million in the 12 months ending Dec. 31, 2015.
That’s an increase from the $76.4-million net income reported for 2014, and comes with total revenue last year of $1.2577 million, up from $1.231 million in 2014.
In a very competitive business, “SaskTel has done very well, as the numbers bear out,” said Jim Reiter, cabinet minister responsible for the Crown corporation.
And when SaskTel’s financial reporting period is extended to March 31, which the government has decided to do in order to align all Crown corporations’ fiscal years with its own budget year, SaskTel’s 15-month 2015-16 revenues grow to $126.7 million.
The Crown corporation attributed the revenue growth to increases in maxTV, Internet and data revenues, plus increased equipment sales and continued wireless growth.
The fall in expenses reflects internal efficiencies and increased competition among equipment suppliers eager for new business in tight times.
SaskTel long has been in the political spotlight, but the glare intensified this spring when Manitoba Telecom Services received a friendly takeover offer from Bell Canada.
It’s been accepted by MTS’s board and the Manitoba courts, but still needs approval from the federal government’s telecommunications and competition regulators.
That would leave SaskTel as the only independent telecommunications company in Western Canada and set off speculation about whether the Saskatchewan government might someday sell it.
“At the government level, I’ve had no discussions with anybody,” Reiter said.
“I don’t believe anybody in government had.”
Reiter also cited the province’s Crown Corporations Protection Act, which says any government wanting to sell any of the province’s four largest Crown corporations must signal its intentions through a motion in the legislature, then win an election before proceeding.
Absent that process, if the government got an unsolicited offer for SaskTel, it would lack a mandate to either accept or reject it, Reiter said.
NDP Crown corporations critic Carla Beck spotted “some ambiguity” in these comments and called the results “a really good news story” for SaskTel.
She also praised its ability to respond to competition and changing technology with innovative approaches and good customer service, borne out by outside firms’ surveys.
She also cited SaskTel’s willingness to take service to remote northern and rural communities, create good jobs, offer competitive rates, invest in infrastructure and pay dividends around $500 million to the provincial government over the last decade
Looking ahead, SaskTel plans to end some old services like CDMA cellphones and let call centre staffing fall as it moves to more customer self-service via the Internet.
It also sees a continuation of existing trends: less revenue from land lines and long-distance calls, and more from wireless and business services.
President Ron Styles also noted the agreement under which Rogers Communications and Bell Canada use SaskTel cell towers is up for renegotiation soon, adding he’s waiting to see how the federal government will deal with regional firms like SaskTel, EastLink in the Maritimes and Videotron in Quebec.
Styles says speculation over SaskTel’s future is noticed by its staff, noted such speculation goes back at least to the 1990s.
And SaskTel’s when financial reporting period is extended to March 31 ... revenues grow to $126.7 million.