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Shaw Communications reported first-quarter fiscal 2023 adjusted earnings from continuing operations of 25 cents per share, missing the Zacks Consensus Estimate by 7.4%.
Total revenues came in at $1.016 billion, beating the consensus mark by 0.14%.
In domestic currency, SJR reported earnings of C$0.34 per share, down 12.8% year over year. Total revenues decreased 1.2% year over year to C$1.37 billion.
As previously disclosed, in order to permit continued engagement with the pending regulatory approval processes and related hearings, Rogers Communications (RCI - Free Report) , Shaw and the Shaw Family Living Trust have agreed to extend the outside date for closing the Rogers-Shaw Transaction from Jul 31, 2022, to Dec 31, 2022, which may further be extended to Jan 31, 2023, at the option of Rogers or Shaw, demonstrating their commitment to completing this transformative combination.
Shaw Communications Inc. Price, Consensus and EPS Surprise
Wireline revenues (75% of total revenues) dropped 2.7% year over year to C$1.02 billion.
Wireline - Consumer revenues fell 3.2% to C$867 million as Internet revenue growth was offset by declines in Video, Satellite and Phone subscribers, and revenues. Wireline - Business revenues of C$161 million was flat year over year.
Wireless revenues (25.2% of the total revenues) increased 3.9% year over year to C$345 million.
In the fiscal first quarter, the company added more than 13,800 Wireless customers, consisting primarily of 12,300 prepaid customers. Postpaid net additions of approximately 1,500 in the quarter were characterized by lower year-over-year Shaw Mobile activity, higher churn and increased competitive intensity.
Wireless average revenue per user decreased 1% from the prior year period to $36.58. Wireless postpaid churn increased 19 basis points (bps) from the first quarter of fiscal 2022 to 1.89%.
Wireless - Service revenues (73% of segment revenues) were up 5.4% from the year-ago quarter to C$252 million.
Wireless - Equipment revenues (27% of segment revenues) remained flat year over year at C$93 million.
Operating Details
In first-quarter fiscal 2023, adjusted EBITDA dropped 2.5% year over year to C$617 million. The adjusted EBITDA margin contracted 60 basis points on a year-over-year basis to 45%.
Segment-wise, Wireline’s adjusted EBITDA dropped 5.3% to C$496 million. The Wireline segment’s adjusted EBITDA margin contracted 130 bps on a year-over-year basis to 48.2%.
Wireless adjusted EBITDA increased 11% to C$121 million. The Wireless segment’s adjusted EBITDA margin expanded 240 bps on a year-over-year basis to 48%.
Cash Flow Details
As of Nov 3, 2022, Shaw Communications had cash and cash equivalents of C$287 million. The company’s net debt position was C$5.56 billion.
Cash flow from operations for the quarter of C$487 million decreased 0.8% from C$491 million in the first quarter of fiscal 2022 primarily due to the decrease in net income, partially offset by an increase in non-cash future income tax expenses.
Capital expenditure in the fiscal first quarter was C$303 million compared with C$299 million in the prior year.
Free cash flow for the quarter of $113 million decreased 55.7% from $255 million in the prior year. The decrease was due to raised capital expenditure, higher income taxes paid and lower revenues.
At the end of fiscal 2022, the net debt leverage ratio was 2.2X, below management’s optimal range of 2.5X-3X.
Zacks Rank & Stocks to Consider
Shaw Communications currently has a Zacks Rank #4 (Sell).
American Public Education’s share price has decreased 41.8% in the past year. The Zacks Consensus Estimate for earnings is pegged at a loss of 13 cents, unchanged over the past 30 days.
Deckers Outdoor gained 19.6% in the past year. Its consensus estimate is pegged at $9.41, which has decreased 0.6% in the past month.
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Shaw Communications (SJR) Q1 Earnings Miss, Revenues Beat
Shaw Communications reported first-quarter fiscal 2023 adjusted earnings from continuing operations of 25 cents per share, missing the Zacks Consensus Estimate by 7.4%.
Total revenues came in at $1.016 billion, beating the consensus mark by 0.14%.
In domestic currency, SJR reported earnings of C$0.34 per share, down 12.8% year over year. Total revenues decreased 1.2% year over year to C$1.37 billion.
As previously disclosed, in order to permit continued engagement with the pending regulatory approval processes and related hearings, Rogers Communications (RCI - Free Report) , Shaw and the Shaw Family Living Trust have agreed to extend the outside date for closing the Rogers-Shaw Transaction from Jul 31, 2022, to Dec 31, 2022, which may further be extended to Jan 31, 2023, at the option of Rogers or Shaw, demonstrating their commitment to completing this transformative combination.
Shaw Communications Inc. Price, Consensus and EPS Surprise
Shaw Communications Inc. price-consensus-eps-surprise-chart | Shaw Communications Inc. Quote
Segmental Update
Wireline revenues (75% of total revenues) dropped 2.7% year over year to C$1.02 billion.
Wireline - Consumer revenues fell 3.2% to C$867 million as Internet revenue growth was offset by declines in Video, Satellite and Phone subscribers, and revenues. Wireline - Business revenues of C$161 million was flat year over year.
Wireless revenues (25.2% of the total revenues) increased 3.9% year over year to C$345 million.
In the fiscal first quarter, the company added more than 13,800 Wireless customers, consisting primarily of 12,300 prepaid customers. Postpaid net additions of approximately 1,500 in the quarter were characterized by lower year-over-year Shaw Mobile activity, higher churn and increased competitive intensity.
Wireless average revenue per user decreased 1% from the prior year period to $36.58. Wireless postpaid churn increased 19 basis points (bps) from the first quarter of fiscal 2022 to 1.89%.
Wireless - Service revenues (73% of segment revenues) were up 5.4% from the year-ago quarter to C$252 million.
Wireless - Equipment revenues (27% of segment revenues) remained flat year over year at C$93 million.
Operating Details
In first-quarter fiscal 2023, adjusted EBITDA dropped 2.5% year over year to C$617 million. The adjusted EBITDA margin contracted 60 basis points on a year-over-year basis to 45%.
Segment-wise, Wireline’s adjusted EBITDA dropped 5.3% to C$496 million. The Wireline segment’s adjusted EBITDA margin contracted 130 bps on a year-over-year basis to 48.2%.
Wireless adjusted EBITDA increased 11% to C$121 million. The Wireless segment’s adjusted EBITDA margin expanded 240 bps on a year-over-year basis to 48%.
Cash Flow Details
As of Nov 3, 2022, Shaw Communications had cash and cash equivalents of C$287 million. The company’s net debt position was C$5.56 billion.
Cash flow from operations for the quarter of C$487 million decreased 0.8% from C$491 million in the first quarter of fiscal 2022 primarily due to the decrease in net income, partially offset by an increase in non-cash future income tax expenses.
Capital expenditure in the fiscal first quarter was C$303 million compared with C$299 million in the prior year.
Free cash flow for the quarter of $113 million decreased 55.7% from $255 million in the prior year. The decrease was due to raised capital expenditure, higher income taxes paid and lower revenues.
At the end of fiscal 2022, the net debt leverage ratio was 2.2X, below management’s optimal range of 2.5X-3X.
Zacks Rank & Stocks to Consider
Shaw Communications currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the same sector are American Public Education (APEI - Free Report) and Deckers Outdoor (DECK - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
American Public Education’s share price has decreased 41.8% in the past year. The Zacks Consensus Estimate for earnings is pegged at a loss of 13 cents, unchanged over the past 30 days.
Deckers Outdoor gained 19.6% in the past year. Its consensus estimate is pegged at $9.41, which has decreased 0.6% in the past month.