Quebecor posted its second quarter results with mobile subscriber growth and rising revenue per customer, something that is getting harder to pull off in Canadian wireless right now.
The Montréal based company brought in $1.44 billion in revenue, up 4.3 per cent year over year. Free cash flow rose 11.7 per cent to $418.7 million and adjusted EBITDA came in at $627.4 million, a 3.7 per cent increase. Net income attributable to shareholders jumped 24.4 per cent to $270.9 million.
Mobile Growth Across Videotron, Freedom and Fizz
Quebecor added 53,200 net mobile lines in the quarter across Videotron, Freedom Mobile and Fizz. Over the past 12 months that adds up to 269,700 new lines, a 6.4 per cent gain.
Mobile service revenue climbed 9.2 per cent to $477.8 million, while Internet access revenue rose 3.1 per cent to $319.2 million.
The number worth watching is ARPU, or average monthly revenue per user, which went up 2.5 per cent. That is $0.86 more per customer and Quebecor’s third consecutive quarterly increase, which the company credits to subscribers picking pricier plans.
For context, Bell reported ARPU falling 2.3 per cent to $56.30 in the same quarter. Quebecor is going the opposite direction while still adding lines, which is what all wireless carriers are trying to figure out.
Freedom Mobile is still doing the heavy lifting for growth out west (all plans include global roaming, which no other carrier offers), Fizz keeps pushing its digital-only model into new markets, and Videotron is running network upgrades in Québec and Ontario to bump up Internet and mobile speeds.
Etiya Stake and $800 Million in Debt Repaid
Quebecor raised its ownership in Etiya to 70 per cent back in April. The AI software company is building a single digital business support platform that will run across Videotron, Freedom and Fizz, which should streamline and unite three separate billing and service systems.
On the balance sheet, Quebecor repaid $800 million under Videotron’s credit facilities during and just after the quarter. Its net debt leverage ratio sits at 2.87 times, the lowest among the major Canadian telecom players.
The board also raised the quarterly dividend 12.5 per cent, from 40 cents to 45 cents per share.
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