Shaw posts lower third-quarter profit, revenue amid COVID-related store closures

Shaw posts lower third-quarter profit, revenue amid COVID-related store closures
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CALGARY — Shaw Communications Inc.’s third-quarter revenue and profit were down from the same time last year due to COVID-19’s impact on its internet, cable and wireless businesses.

Net income fell 18.9 per cent from the same time last year to $184 million or 35 cents per share, it announced Friday after stock markets closed.

Revenue for the three months ended May 31 was $1.31 billion, down 0.8 per cent from the third quarter of fiscal 2019.

“While the financial impacts from COVID-19 in the third quarter were not material, the situation is still uncertain in terms of its magnitude, outcome and duration,” the company said Friday.

“Consumer behaviours could still change materially, including the potential downward migration of services, acceleration of cord-cutting and reduced ability to pay their bills, all due to the challenging economic situation.”

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 noted that 90 per cent of its retail locations were closed during the quarter due to the 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, as many customers temporarily suspended, cancelled or reduced their accounts due to pandemic closures.

Shaw Business primarily serves the small- and medium-sized market, which the company said is especially vulnerable to lower commodity prices, mandated COVID closures and social distancing.

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

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

The Canadian Press

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