Shaw Communications reports better-than-expected Q1 results, raises dividend

CALGARY – Shaw Communications Inc. posted higher quarterly results Wednesday that beat analyst expectations, with the strongest performance coming from its media division.

The Calgary-based company (TSX:SJR.B), which also raised its dividend, reported $235 million, or 50 cents per share, in net income in the three months ended Nov. 30, the first quarter of its 2013 fiscal year. That’s up from $202 million, or 43 cents per share, a year earlier.

The results beat consensus estimates compiled by Thomson Reuters, with earnings per share about four or five cents per share above expectations, depending on the method used for calculating profit.

Combined revenue from the company’s cable, Internet, media and other businesses was $1.32 billion, up three per cent from $1.28 billion a year earlier.

Subscriber numbers, however, weren’t as rosy, with the company reporting 24,000 fewer cable additions compared the same quarter a year earlier. Internet and phone divisions added 6,000 and 17,000 subscribers, respectively.

The relatively new media division, formed from the television assets acquired from CanWest in 2010, had the fastest growth — with revenue rising seven per cent year to year to $319 million.

The company would welcome any opportunities to further grow that business, CEO Brad Shaw told reporters following the company’s annual general meeting.

“We’re always interested in talking, looking at what opportunities could help our portfolio of assets and help us grow,” he said.

“(But) Things are consolidated — it’s not like there’s a lot of things up for sale.”

The Canadian Radio-television and Telecommunications Commission recently nixed Bell’s (TSX:BCE) $3.4-billion deal to take over Astral Media (TSX:ACM.A), a Montreal-based specialty TV and radio company, saying it would lead to too much market concentration.

Shaw said there may be “some appeal” should Astral Media assets come up for sale, but there was no particular urgency on that front.

“We’re very comfortable with what we’ve got. When you look at The Movie Network and stuff, I think there’s opportunities for other companies in that regard. So there may be a little bit in there. But if it comes to us, we’re certainly open for conversation.”

Also Wednesday, Shaw announced its monthly dividend would rise by five per cent, starting with the March payout to shareholders. On an annualized basis, Shaw B shares will receive $1.02 a year per share, including 8.5 cents a share to be paid on March 15.

Shaw has announced it plans to launch a 24-hour news channel that will have the Global BC brand and provide local, national and international headlines.

Shaw also has launched a mobile app to offer customers streaming access to TV shows and movies. Called Shaw Go, the app for Apple devices streams content for TV customers who pay for Movie Central programming, including HBO Canada titles.

RBC Dominion Securities analyst Drew McReynolds said that while cable margins surprised to the upside, net subscriber additions were lower than expected, which should “bode well” for Vancouver-based rival Telus Corp.’s (TSX:T) numbers when it reports its quarterly results.

The company’s stock rose five cents to $22.59 per share late Wednesday afternoon on the Toronto Stock Exchange.