We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Rogers Communications (RCI) Misses on Q2 Earnings, Revenues
Read MoreHide Full Article
Rogers Communications (RCI - Free Report) reported second-quarter adjusted earnings of 87 cents per share that missed the Zacks Consensus Estimate by a couple of cents.
Total revenues of $2.83 billion also missed the consensus mark of $2.96 billion.
Adjusted earnings however increased 8.4% year over year to C$1.16 per share. Total revenues increased 0.6% year over year to C$3.78 billion.
Investors should note that second-quarter 2019 results were reported per IFRS 16.
Notably, Rogers Media, a subsidiary of Rogers Communications, acquired Vancouver-based podcasting company, Pacific Content during the quarter.
Rogers Communication, Inc. Price, Consensus and EPS Surprise
Wireless (59.4% of total revenues) increased 1.4% from the year-ago quarter to C$2.24 billion.
Service revenues climbed 3% to C$1.81 billion, attributable to an expanded postpaid subscriber base and increase in the number of customers choosing higher-priced plans.
Equipment revenues were down 4.9% to C$431 million due to lower device upgrades by existing users and decline in gross postpaid subscriber additions owing to softness in the market.
Monthly blended average revenue per user was C$56.73, up 2% year over year. Monthly blended average billings per user was C$67.16, up 3.6%.
As of Jun 30, 2019, prepaid subscriber base totaled almost 1.4 million, a loss of 254K subscribers from the year-ago quarter. Monthly churn rate was 4.43% compared with 3.98% in the year-ago quarter.
As of Jun 30, 2019, postpaid wireless subscriber base totaled roughly 9.2 million, a subscriber gain of 336K from the year-ago quarter. Monthly churn rate declined to .99% from 1.01% in the year-ago quarter. The lower churn rate was due to enhanced customer experience and improved quality of Rogers Communications’ network.
Segment operating expense decreased 5.8% from the year-ago quarter to C$1.12 billion.
Adjusted EBITDA increased 9.6% year over year to C$1.13 billion. Adjusted EBITDA margin expanded 380 basis points (bps) on a year-over-year basis to 50.3%.
Cable Details
Cable (26.4% of total revenues) inched up 0.6% from the year-ago quarter to C$997 million. The increase was due to higher Internet subscriber base and shift of Internet users to higher-usage tiers.
Service revenues climbed 0.5% to C$993 million.
Internet revenues increased 6.5% year over year due to user shift toward higher-GB tiers and increase in subscriber base, partially offset by increased promotional activities. As of Jun 30, 2019, Internet subscriber count was nearly 2.46 million, up 96K from the year-ago quarter.
During the quarter, Rogers Communications launched unlimited data plans with no overage charges. Its Infinite plan with unlimited wireless data starts at $75 for 10GB of high-speed data for every line. Customers requiring more high-speed data will have the option to purchase a Speed Pass for $15 for 3GB.
The company is set to launch new financing options, giving customers more affordable smartphone and device opportunities.
Television revenues were down 0.6% year over year due to decline in subscriber base. This was offset by pricing changes and addition of new Ignite TV subscribers.
Rogers Communications lost 88K subscribers on a year-over-year basis to reach an installed base of almost 1.63 million in the Television segment.
Phone revenues plunged 30.1% year over year primarily due to bundled discount pricing. Subscriber count was nearly 1.1 million, a decline of 24K from the year-ago quarter.
Equipment revenues jumped 33.3% year over year to C$4 million.
Segment operating expense decreased 1.9% from the year-ago quarter to C$519 million.
Adjusted EBITDA increased 3.5% year over year to C$478 million. Adjusted EBITDA margin expanded 130 bps on a year-over-year basis to 47.9%.
Media Details
Media (15.6% of total revenues) declined 2.8% from the year-ago quarter to C$591 million. The decline in revenues was primarily due to the sale of the company’s publishing business and lower Toronto Blue Jays revenues.
Segment operating expense decreased 5.3% year over year to C$519 million primarily attributed to lower publishing-related costs and Toronto Blue Jays player salaries.
Adjusted EBITDA increased 20% year over year to C$72 million.
Consolidated Results
Operating costs declined 4.8% from the year-ago quarter to C$2.15 billion. As a percentage of revenues, operating costs increased 320 bps to 56.7%.
Adjusted EBITDA increased 8.7% from the year-ago quarter to C$1.64 billion. Adjusted EBITDA margin expanded 320 bps to 43.3%.
Balance Sheet & Cash Flow Details
As of Jun 30, 2019, Rogers Communications had cash and cash equivalents of $404 million compared with $264 million at the end of the previous quarter.
Cash provided by operating activities increased 0.9% year over year to C$1.05 billion. However, free cash flow declined 2.4% year over year to C$609 million due to increase in cash income taxes for the reported quarter. This was negated by “lower interest on borrowings.”
Rogers Communications paid C$257 million in dividends in the reported quarter. The company repurchased shares worth $55 million.
Rogers Communications ended the second quarter with a debt leverage ratio (adjusted net debt/adjusted EBITDA) of 3, up from 2.5 at the end of 2018.
Guidance for 2019
Revenues are expected to increase in the range of 3%-5%. Adjusted EBITDA is expected to increase in the range of 7%-9%.
Zacks Rank & Stocks to Consider
Rogers Communications currently carries a Zacks Rank #2 (Buy).
Dolby Laboratories, Liberty Global and AMC Entertainment are set to report their quarterly earnings on Aug 1, 7 and 8, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Rogers Communications (RCI) Misses on Q2 Earnings, Revenues
Rogers Communications (RCI - Free Report) reported second-quarter adjusted earnings of 87 cents per share that missed the Zacks Consensus Estimate by a couple of cents.
Total revenues of $2.83 billion also missed the consensus mark of $2.96 billion.
Adjusted earnings however increased 8.4% year over year to C$1.16 per share. Total revenues increased 0.6% year over year to C$3.78 billion.
Investors should note that second-quarter 2019 results were reported per IFRS 16.
Notably, Rogers Media, a subsidiary of Rogers Communications, acquired Vancouver-based podcasting company, Pacific Content during the quarter.
Rogers Communication, Inc. Price, Consensus and EPS Surprise
Rogers Communication, Inc. price-consensus-eps-surprise-chart | Rogers Communication, Inc. Quote
Wireless Details
Wireless (59.4% of total revenues) increased 1.4% from the year-ago quarter to C$2.24 billion.
Service revenues climbed 3% to C$1.81 billion, attributable to an expanded postpaid subscriber base and increase in the number of customers choosing higher-priced plans.
Equipment revenues were down 4.9% to C$431 million due to lower device upgrades by existing users and decline in gross postpaid subscriber additions owing to softness in the market.
Monthly blended average revenue per user was C$56.73, up 2% year over year. Monthly blended average billings per user was C$67.16, up 3.6%.
As of Jun 30, 2019, prepaid subscriber base totaled almost 1.4 million, a loss of 254K subscribers from the year-ago quarter. Monthly churn rate was 4.43% compared with 3.98% in the year-ago quarter.
As of Jun 30, 2019, postpaid wireless subscriber base totaled roughly 9.2 million, a subscriber gain of 336K from the year-ago quarter. Monthly churn rate declined to .99% from 1.01% in the year-ago quarter. The lower churn rate was due to enhanced customer experience and improved quality of Rogers Communications’ network.
Segment operating expense decreased 5.8% from the year-ago quarter to C$1.12 billion.
Adjusted EBITDA increased 9.6% year over year to C$1.13 billion. Adjusted EBITDA margin expanded 380 basis points (bps) on a year-over-year basis to 50.3%.
Cable Details
Cable (26.4% of total revenues) inched up 0.6% from the year-ago quarter to C$997 million. The increase was due to higher Internet subscriber base and shift of Internet users to higher-usage tiers.
Service revenues climbed 0.5% to C$993 million.
Internet revenues increased 6.5% year over year due to user shift toward higher-GB tiers and increase in subscriber base, partially offset by increased promotional activities. As of Jun 30, 2019, Internet subscriber count was nearly 2.46 million, up 96K from the year-ago quarter.
During the quarter, Rogers Communications launched unlimited data plans with no overage charges. Its Infinite plan with unlimited wireless data starts at $75 for 10GB of high-speed data for every line. Customers requiring more high-speed data will have the option to purchase a Speed Pass for $15 for 3GB.
The company is set to launch new financing options, giving customers more affordable smartphone and device opportunities.
Television revenues were down 0.6% year over year due to decline in subscriber base. This was offset by pricing changes and addition of new Ignite TV subscribers.
Rogers Communications lost 88K subscribers on a year-over-year basis to reach an installed base of almost 1.63 million in the Television segment.
Phone revenues plunged 30.1% year over year primarily due to bundled discount pricing. Subscriber count was nearly 1.1 million, a decline of 24K from the year-ago quarter.
Equipment revenues jumped 33.3% year over year to C$4 million.
Segment operating expense decreased 1.9% from the year-ago quarter to C$519 million.
Adjusted EBITDA increased 3.5% year over year to C$478 million. Adjusted EBITDA margin expanded 130 bps on a year-over-year basis to 47.9%.
Media Details
Media (15.6% of total revenues) declined 2.8% from the year-ago quarter to C$591 million. The decline in revenues was primarily due to the sale of the company’s publishing business and lower Toronto Blue Jays revenues.
Segment operating expense decreased 5.3% year over year to C$519 million primarily attributed to lower publishing-related costs and Toronto Blue Jays player salaries.
Adjusted EBITDA increased 20% year over year to C$72 million.
Consolidated Results
Operating costs declined 4.8% from the year-ago quarter to C$2.15 billion. As a percentage of revenues, operating costs increased 320 bps to 56.7%.
Adjusted EBITDA increased 8.7% from the year-ago quarter to C$1.64 billion. Adjusted EBITDA margin expanded 320 bps to 43.3%.
Balance Sheet & Cash Flow Details
As of Jun 30, 2019, Rogers Communications had cash and cash equivalents of $404 million compared with $264 million at the end of the previous quarter.
Cash provided by operating activities increased 0.9% year over year to C$1.05 billion. However, free cash flow declined 2.4% year over year to C$609 million due to increase in cash income taxes for the reported quarter. This was negated by “lower interest on borrowings.”
Rogers Communications paid C$257 million in dividends in the reported quarter. The company repurchased shares worth $55 million.
Rogers Communications ended the second quarter with a debt leverage ratio (adjusted net debt/adjusted EBITDA) of 3, up from 2.5 at the end of 2018.
Guidance for 2019
Revenues are expected to increase in the range of 3%-5%. Adjusted EBITDA is expected to increase in the range of 7%-9%.
Zacks Rank & Stocks to Consider
Rogers Communications currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader consumer discretionary sector include Dolby Laboratories (DLB - Free Report) , AMC Entertainment (AMC - Free Report) and Liberty Global (LBTYA - Free Report) . All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Dolby Laboratories, Liberty Global and AMC Entertainment are set to report their quarterly earnings on Aug 1, 7 and 8, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>