Earnings season for Canada’s telecom players kicks off on Tuesday and much of the focus is on the impact of Apple Inc.’s iPhone.
Rogers Communications Inc., which released the iPhone 3G on July 11, is first to report third quarter results to the end of September. While the launch has caused some short-term pain, Rogers should reap the long-term benefits such as a three-year contract term, lower customer turnover and higher revenues, Desjardins Securities analyst Joseph MacKay said in a research note. For example, average revenue per user should climb to $100 a month compared with roughly $74 now.
He estimates Rogers sold a whopping 225,000 iPhones, 60% of which went to existing subscribers and 40% to new ones. Assuming a subsidy of $400 per phone, this should add $90-million to its costs this quarter, the analyst noted. This should impact EBITDA growth this quarter and next since iPhones should be popular Christmas gifts, Mr. MacKay added.
BCE Inc. reports on October 29 and the Desjardins analyst expects the entry of the iPhone held back additions – from 137,000 in the second quarter to 85,000 in the third.
Telus Corp., which reports on November 7, should see an 8% dip in net wireless additions to 125,000 compared to the same period a year ago as a result of the iPhone. Mr. MacKay also expects its annual dividend increase to rise 20% to $2.16 per share.
Source: nationalpost.com
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