Shaw Communications, Inc. (SJR)
F1Q2013 Results Earnings Call
January 9, 2013 3:30 PM ET
Executives
Brad Shaw - Chief Executive Officer
Peter Bissonnette - President
Steve Wilson - Chief Financial Officer
Jay Mehr - Senior Vice President, Operations
Jean Brazeau - Senior Vice President, Regulatory
Michael D'Avella - Senior Vice President, Planning
Paul Robertson - President, Shaw Media
Jim Cummins - Group Vice President, Shaw Satellite Operations
Analysts
Phillip Huang - UBS Investment Bank
Vince Valentini - TD Newcrest
Jeff Fan - Scotiabank Global Banking and Markets
Tim Casey - BMO Capital Markets
Glen Campbell - Bank of America/Merrill Lynch
Drew McReynolds - RBC Capital Markets
Rob Goff - Byron Capital Markets
Maher Yaghi - Desjardins Securities
Presentation
Operator
Welcome to the Shaw Communications Fiscal 2013 First Quarter Conference Call. Today's call will be hosted by Mr. Brad Shaw, CEO of Shaw Communications. At this time all participants are in a listen-only mode. Following the presentation, there will be a question-and-answer session. (Operator Instructions) If the press has any questions, please contact Mr. Shaw after the call.
Before we begin, management would like to remind listeners that comments made during today's call will include forward-looking information, and there are risks that actual results could differ materially. Please refer to the company's publicly filed documents for more details on assumptions and risks.
Mr. Shaw, I’ll turn the call over to you.
Brad Shaw
Thank you, Operator. And thanks to everyone for joining us today to discuss our first quarter results for fiscal 2013. With me today are members of our senior management team including Peter Bissonnette, President; Steve Wilson, Chief Financial Officer; Jay Mehr, Senior Vice President of Operations; Jean Brazeau, Senior Vice President of Regulatory; Michael D'Avella, Senior Vice President of Planning; Paul Robertson, President, Shaw Media; and Jim Cummins, Group Vice President, Shaw Satellite Operations.
Earlier today, we held our Annual General Meeting and released our Q1 results. I'll make some brief remarks before we open up the call for questions.
Our performance this quarter reflects the efforts we have made toward enhancing our customer service capacity, expanding our technology and infrastructure advantage, and maintaining price and financial discipline.
We have seen a gradual and stead return in the market to a more discipline and sustainable approach to pricing and promotional offers, building on the momentum from our second half of last year we delivered strong first quarter financial results.
Cable EBITDA in the quarter was up 5% compared to a year ago and our Q1 margin of almost 49% reflects the continued balance of customer profitability and growth in subscription revenue.
Our consolidated business generated free cash flow of almost $245 million this quarter and we are pleased to announce that our Board today approved the 5% dividend increase that is effective at the beginning of May. This continues our track record of returning capital to shareholders and reenforces management and our Board’s confidence in the long-term free cash flow profile of our assets.
Since the beginning of fiscal 2013, we have -- we have had, sorry, we have been focus on improving our business for our customers and viewers. We have responded to our customer’s demand for greater content, connectivity and convenience, while maintaining a leadership position in a highly competitive market.
During the quarter we launched the [bold] new brand in marketing platform in the series of initiatives that transform the customer experience, brining TV into the Internet era with innovations like Shaw on-demand search app, the Shaw Go Movie Central and NFL Sunday ticket apps and our new [HD Go].
We continue to expand our Wi-Fi network footprint complementing the rapidly growing demand for broadband. Today the trial of a Shaw Go Wi-Fi continues across Western Canada with thousands of access points available to customers as part of the internet service. Recently we reached agreements with municipalities in Winnipeg and Victoria to extend coverage to key public venues in those cities.
Our digital network upgrade project continues to build network capacity enabling us to deliver new channels, more HD television and faster network speeds. We remain on track to complete the upgrade of our analog gears to digital in 2013. Our media business continues to be strong and our mid-season line-up of global TD looks to build on the momentum generated by our successful fall season. This success is reflected in media financial results as revenue and EBITDA were up 7% and 9% respectively in Q1.
Our satellite business saw the record install and we’re making preparations to become the HD leader in Canada with over 200 HD channels becoming available following the launch of Anik G1 later this year. But we aren’t resting on these plans and achievements. We are building our business for the future, working hard to strengthen our advantages and capitalize on opportunities. We remain confident about the free cash flow profile of our consolidated assets and we will keep our operating focused chart.
As I told our shareholders at our AGM, we believe our continued success will depend on execution of four priorities. First, we will deliver exceptional customer and viewer experiences. Second, we will continue to leverage our leading technology as a competitive advantages across all our businesses. Third, we will find ways to maintain and grow customer profitability, and finally, we will continue to identify new operational efficiencies.
Our confidence in our ability to generate long term shareholder value is rooted in our strong management team and employees who genuinely care about delivering exceptional experiences for our customers and viewers. I want to thank everyone on the Shaw team for their effort and commitment, our people, customers and viewers are the keys to our long term success.
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