Strong growth in its digital cable subscriber numbers helped Shaw Communications tally higher third-quarter profits, the Calgary-based cable, Internet and satellite carrier has reported.
“On a year-to-date basis we have added almost 280,000 Digital customers increasing our penetration of Basic from 40% at August 31, 2008 to 52%, CEO Jim Shaw noted in a release. “Digital and HDTV continue to enhance the home entertainment experience offering viewer’s access to a wider variety of programming options, an ever-expanding VOD library and superior picture quality. Shaw is committed to being at the forefront of technology advances that continue to support growth in this area.”
Shaw's profits were $132 million, or 31 cents per share, compared to $128 million, or 30 cents per share, for the same period a year ago.
Quarterly revenue rose nine per cent to $861 million.
Shaw said the number of subscribers increased for all its key businesses, but reported gains were most pronounced among digital cable customers. The company added nearly than 111,000 subscribers to its digital cable service for a total of 1,187,183 by quarter-end.
Shaw said basic cable subscribers increased by about 9,600, while subscribers to the company's Internet and digital phone lines grew by 24,600.
Service revenue in the Cable division was up 10% and 11% for the quarter and year-to-date periods, respectively, to $670 million and $1.95 billion. The improvement was primarily driven by customer growth and rate increases. Service operating income before amortization improved
almost 11% for the three and nine month periods to $325 million and $942 million, respectively. Service revenue in the Satellite division was $192 million and $569 million for the three and nine month periods respectively, up 4% and 5%, respectively, over the comparable periods last year.
The improvement was primarily due to rate increases and customer growth. Service operating income before amortization for the quarter increased 13% to $70 million, and the year-to-date was up 8% to $203 million.
Shaw added, “Strong subscriber growth and solid operational performance delivered financial results year-to-date that keep us on track to achieve our financial guidance for the year, including generating free cash flow of at least $500 million.”
On March 27, 2009 the Company closed a $600 million offering of 6.50% senior notes due June 2, 2014. The net proceeds are being used for debt repayment, working capital and general corporate purposes. On April 15, 2009 Shaw subsequently redeemed the Videon Cablesystems Inc. Cdn $130 million Senior Debentures.
Shaw concluded “Our dedicated team of 10,000 Shaw employees have met the challenge of these uncertain economic times by consistently delivering exceptional customer service, introducing new products, and managing the operations prudently. Our strategy is sound: we focus on our core business, deliver consistent service, grow our subscriber base, offer value through new products."