Rogers 2015 Q1 Sees Profits Drop 17%, Loses 63,000 Wireless Customers
Rogers today announced their first quarter earnings for their 2015 fiscal year, which saw a 17% decline in profits to $255 million, compared to $307 million in the year ago quarter.
Wireless revenue did see an increase of 4% to $1.79 billion, while blended average revenue per user (ARPU) increased $1.12 to $58.75, which the company says was a result of increased network revenue and wireless data usage.
Beginning this quarter, Rogers says it will start calculating average revenue per account (ARPA), which is calculated by dividing total wireless postpaid network revenue (monthly) by the average number of wireless postpaid accounts for the same period.
While the company activated 700,000 wireless smartphones in the quarter, with 32% of them being new subscribers (and 83% of these customers being ‘higher-value’ postpaid customers).
Rogers saw 63,000 wireless users leave the company (26,000 net postpaid; 37,000 prepaid) for rival services, which the company partly blamed on the CRTC’s ruling which allows customers to cancel without giving 30 days notice. Similarly, the shortening of contracts to two years caused operating expenses to increase 32%, as the company worked harder to reduce its churn rate.
“We continued to see steady revenue growth this quarter along with strong growth in Wireless ARPA,” said Guy Laurence, President and Chief Executive Officer of Rogers. “We made planned strategic investments to retain high-value customers ahead of the conclusion of the industry-wide shift to two-year contracts this summer – our underlying adjusted operating profit growth was otherwise solid. At the same time, we moved full steam ahead with our Rogers 3.0 program by delivering a number of initiatives that are popular with our customers. Our plan is gaining traction and we expect continued improvements in our key financial and operating results as the year progresses.”
Rogers now has 9,479,000 wireless subscribers in Canada. The company will hold its annual shareholder meeting tomorrow in Toronto.