Rogers reports loss for third quarter despite jump in revenue

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Rogers Communications Inc. reported a net loss in the third quarter despite an increase in total revenue.

The telecom giant said the loss of $99 million was a result of higher finance costs and costs related to its acquisition of Shaw Communications Inc., partially offset by increased earnings before interest, taxes, depreciation and amortization. It also  included a $422-million loss on joint venture investments.

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The third-quarter results, released Nov. 9, showed a 52 per cent increase in consolidated adjusted EBITDA of $2.41 billion. Total revenue was $5.09 billion, up 36 per cent from last year, when it issued $150 million in credits to customers affected by a July 2022 network outage.

“I’m very pleased to report that we delivered industry leading results in the third quarter, our seventh consecutive quarter of growth and momentum,” chief executive Tony Staffieri told analysts during the Thursday morning earnings call.

On an adjusted basis, net income increased by 56 per cent to $679 million in the quarter, primarily as a result of higher adjusted EBITDA.

Adjusted diluted earnings per share were $1.27, up from $0.84 in the third quarter of 2022.

The carrier said it added 279,000 mobile phone and internet subscribers, up 52,000 from last year. Its total mobile phone net adds totalled 261,000, which the company said was the best quarterly result yet.

Cable service revenue went up 105 per cent, driven by revenues related to its acquisition of Shaw, which contributed approximately $1 billion for the quarter, the company said.

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“Our Shaw integration is proceeding extremely well and our investment thesis becomes stronger with each quarter,” said chief financial officer Glenn Brandt.

Rogers said its market share gains are accelerating in Western Canada due to its merger with Shaw, which is six months into integration. The acquired primary products include internet, video, home phone services and wireless services through Shaw Mobile.

“Looking ahead, Alberta and British Columbia represent our fastest growing revenue markets and we see good growth opportunity ahead,” said Staffieri.

Desjardins analyst Jerome Dubreuil said the wireless postpaid net additions of 225,000 — a 37 per cent year-over-year increase — easily beat consensus of 190,600. Total net adds of 261,000 also surpassed rivals BCE Inc.’s 166,930 and Telus’ 160,000 mobile net adds, he said.

The company’s full-year 2023 financial guidance remains unchanged from the second quarter.

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Scotiabank analyst Maher Yaghi said that while this was not changed, management is indicating that integration synergies are coming faster than expected, and now anticipates a $600-million run rate by year end, six months faster than planned..

Brandt said the company is still targeting $1 billion in synergies.

“Once we’ve worked through those targets to get to the billion dollars, the exercise then simply turns to … our year-over-year growth,” he said.

Rogers stock was trading $57.30 at 10:23 a.m. ET in Toronto, up 3.54 per cent.

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