Shaw posts lower third-quarter profit, revenue amid COVID but beats expectations

CALGARY — Shaw Communications Inc.'s third-quarter revenue and profit were down from the same time last year due to COVID-19's impact, but the cable and wireless company still beat expectations Friday.

Net income for the three months ended May 31 fell 18.9 per cent from the same time last year to $184 million or 35 cents per share. Revenue slipped 0.8 per cent to $1.31 billion.

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But analysts had estimated just $152 million of profit and $1.26 billion of revenue according to Refinitiv, a financial data company.

"Overall, we delivered Q3 results that were ahead of our expectations," chief executive Brad Shaw told analysts in a conference call.

"That having been said, COVID and its related challenges will be a part of our story for the foreseeable future."

The company noted that, besides the pandemic, its customers have been affected by low commodity prices that have weighed heavily on its home province of Alberta.

Shaw said that 90 per cent of its Freedom stores were closed during the quarter due to COVID-19 lockdowns, affecting its ability to add subscribers and sell equipment such as smartphones.

Its Freedom Mobile wireless business added about 2,200 postpaid customers but lost 7,700 pre-paid subscribers. Its wireline business lost 5,100 internet subscribers and 22,000 video customers.

On the other hand, Freedom's churn rate — which measures how many customers leave — was a company record low of 0.96 per cent.

At Shaw's business services unit, revenue was similar to last year at $140 million, although it was down 2.8 per cent compared with the second quarter that ended in February..

Shaw Business primarily serves the small- and medium-sized market, and many of those customers temporarily suspended, cancelled or reduced their accounts due to pandemic closures.

This report by The Canadian Press was first published July 10, 2020.

Companies in this story: (TSX:SJR.B)

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