Telus Profit Drops 75% Amid Customer Gains in Q3
Telus announced its third-quarter results for 2023 on Friday, highlighting a growing customer base but grappling with a significant decline in profit.
The telecom giant reported an all-time quarterly record with a total customer growth of 406,000, marking an increase of 59,000 from the previous year. This uptick is attributed to the demand for the company’s portfolio of bundled services across both its mobility and fixed sectors.
Telus saw net additions of 160,000 mobile phones, setting a record for the third quarter, and another record with 179,000 connected devices. The fixed sector also added 67,000 customers, including 37,000 internet customers to its PureFibre network. Mobile phone average revenue per user was $59.19, a decrease of $0.29 or 0.5 per cent for the quarter.
There was a growth of 7.2% in consolidated operating revenue and 5.5% in adjusted EBITDA. Free cash flow also experienced a growth of 7.3%.
However, the company encountered a substantial 75% drop in net income, attributed to higher restructuring costs, increased depreciation, amortization, and financing costs. Adjusted net income also declined by 21%. Despite these financial hurdles, the company raised its quarterly dividend to $0.3761, up 7.1% from the previous year, reflecting a dividend yield of approximately 6.5%.
“For the third quarter, our Telus team showcased a blend of leading customer growth, robust operational and financial outcomes, alongside improving EBITDA growth and margin expansion in our [digitally-led customer experiences] segment,” said Darren Entwistle, President and CEO of Telus in a statement.
Compared to the same period in the previous year, the company’s net income for the quarter was $137 million, marking a sharp decline of 75%. Basic earnings per share (EPS) also decreased by 76% to $0.09.
The report further detailed the growth in various subscriber bases, including a 4.0% increase in mobile phone subscribers and a 23% rise in connected devices. Internet connections grew by 9.2% over the last twelve months, with TV and security customer bases also seeing notable expansions.