Canadian media and communications company Shaw Communications, Inc. (SJR, SJR_B.TO) Friday reported an increase in second-quarter profit, reflecting higher revenues and improved operating margin.
Brad Shaw, chief executive officer of the company stated, "Our second quarter financial results were solid reflecting the underlying strength across our businesses as we focus on sustainable and profitable growth."
Revenues from Cable division increased 1 percent to C$814 million. Meanwhile, Satellite division revenue declined to C$209 million from C$211 million a year ago. The company noted that revenue growth in the Cable and Satellite divisions, were mainly driven by rate increases, but was partially reduced by higher expenses including employee related amounts and higher programming.
Revenues from Media division were C$249 million, up 3 percent from the preceding year, reflecting improved advertising and subscriber revenues.
For the quarter, digital phone lines increased 13,090 from the year-ago period to a total of 1.37 million and Internet customers rose 7,800 to 1.91 million. Video customers decreased 29,829 to 2.14 million, while DTH customers increased 1,328 to 907,330 as at February 28, 2013.
In the second quarter, net income attributable to equity shareholders increased to C$172 million from C$169 million in the previous year. On a per share basis, earnings were C$0.38, unchanged from last year.
Quarterly revenue rose 1.6 percent to C$1.25 billion from C$1.23 billion in the year-ago quarter.
Operating margin improved to 43 percent from 40 percent in the prior year. Operating margin for the current year included impact of an adjustment to align certain broadcast license fees with the CRTC billing period of about $14 million, the company said. Excluding the adjustment, operating margin would be 41.9 percent for the recent quarter.
For fiscal 2013, the company still anticipates modest growth in consolidated revenue and operating income before amortization. The company now expects to deliver consolidated free cash flow of about C$550 million.
Shaw Communications also announced that its Board of Directors has declared monthly dividends of C$0.085 on its Class B Non-Voting Participating Shares and C$0.084792 on its Class A Participating Shares, payable on each of June 27, July 30 and August 29, 2013, to shareholders of record on June 14, July 15 and August 15, 2013, respectively.
On Monday, Shaw Communications entered into agreements to buy Enmax Envision Inc., a telecommunication services provider, from Enmax Corp. for about C$225 million. The acquisition is expected to close during the third quarter.
On the New York stock exchange, SJR is currently trading at $23.92, down $0.45 or 1.85 percent on a volume of 103,081 shares.
On the Toronto stock exchange, SJR-B.TO is trading at C$24.21, down C$0.45 or 1.82 percent on a volume of 382,924 shares.
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