TORONTO (Reuters) - Shaw Communications reported a 28 percent jump in profit on Wednesday as it reaped the benefits of cost cutting, introduced faster broadband Internet and raised prices for cable television.
Shaw said it expects 2011 growth to decline from a rate of around 7.5 percent last year due to competitive pressures and higher programing costs.
The Calgary-based cable company had net income of C$203 million ($209 million), or 45 Canadian cents a share, on revenue of C$1.28 billion in the three months to May 31.
Analysts had on average expected Shaw to earn 42 Canadian cents a share on revenue of C$1.27 billion, according to Thomson Reuters I/B/E/S.
Shaw had a profit of 37 Canadian cents a share a year ago on revenue of C$943.6 million.
The company said it spent C$22 million in the quarter on building its wireless network, but did not detail when the service might launch.
Shaw has delayed its entry into the booming Canadian wireless market, the fourth leg of any bundling offer for television, landline phone and Internet services.
The Western Canadian-focused company bought wireless spectrum in a 2008 government auction, but has been sluggish compared with other buyers such as new entrants Mobilicity and Wind Mobile, already present in most major Canadian cities.
Its cable sales grew 5 percent, bolstered by the lapsing of promotions offered last year to offset rival Telus’ launch of Internet-protocol television product Optik.
The company upped prices for cable and Internet on April 1, which helped revenue but hurt subscriber growth.
Shaw lost 13,577 basic cable subscribers in the quarter, leaving it with 2.30 million, while digital customers rose by 19,202 to 1.77 million. Internet customers rose by 11,165 to 1.86 million and digital phone lines were up by 31,404 to 1.21 million.
Analysts had expected the company to lose around 12,000 basic cable customers and to add some 41,000 more lucrative digital cable users. The company was expected to add some 14,500 Internet accounts and 36,000 telephone lines, according to five analysts polled by Reuters.
Shaw said it was on track to record free cash flow for the fiscal year of around C$600 million.
The shares closed on Monday at C$21.26 on the Toronto Stock Exchange, down more than 3 percent this year.
Reporting by Alastair Sharp; editing by Janet Guttsman, Dave Zimmerman