Shaw's ongoing operations disappoint, Wind Mobile buy helps
By Alastair Sharp
TORONTO (Reuters) - Shaw Communications Inc's (SJRb.TO: Quote) third-quarter profit more than tripled, boosted by its purchase of Wind Mobile and sale of media assets, but earnings from ongoing operations disappointed and its shares fell on Friday.
The Calgary-based company surprisingly lost retail internet customers, and continued to shed cable television customers. It launched an aggressively priced top-tier internet promotion, suggesting pricing pressures out west may heat up.
Company President Jay Mehr said "nobody is happy" with the internet loss, with Shaw reliant on high-speed internet and wireless to fuel growth.
"We're going to choose to behave differently in the marketplace going forward," Mehr told analysts on a conference call.
Shaw has, via two recent billion-dollar-plus deals, sharpened its focus on selling access to broadband data, whether delivered via cable or wireless connections.
It sold its media assets to sister company Corus Entertainment Inc (CJRb.TO: Quote) for C$2.65 billion ($2.05 billion), using the cash proceeds to fund its C$1.6 billion purchase of Wind, the country's fourth largest wireless company.
Wind had a 22 percent operating margin on revenue of C$132 million in the quarter. Shaw said it would spend C$250 million to upgrade Wind's network in fiscal 2017.
"The growth that we are seeing is part of our 'walk before we run' strategy," Alek Krstajic, who runs the wireless unit, said on the analyst call. Continued...