(Vancouver) Telus plans to invest $73 billion to strengthen its networks over the next five years, President and CEO Darren Entwistle announced Thursday at the telecommunications company’s annual general meeting.
The investment would cover new infrastructure, technologies, operations as well as new spectrum, he said.
This comes as some of Telus’ competitors announced they would cut network spending in response to unfavorable regulatory policies.
“These funds will ensure that our networks remain robust, resilient, reliable and, above all, accessible to the millions of customers and businesses who rely on us every day,” Entwistle said, noting that the funding is in addition to 259 billion that Telus has invested in technology and infrastructure since 2000.
Telus secured the largest number of licenses in the federal government’s most recent wireless spectrum auction –– the bandwidths of radio waves that carry signals – last fall.
The auction offered telecommunications companies the chance to buy chunks of mid-band wireless spectrum, touted for their ability to carry large amounts of data over long distances.
Telus obtained 1,430 licenses for nearly 620 million.
Mr. Entwistle mentioned that decommissioning Telus’ copper wire networks during the transition to fiber remains a key ongoing project. Since 2018, Telus has migrated more than half a million residential customers from copper to fiber networks in provinces like British Columbia and Alberta.
“This approach allows (Telus) to prioritize our efforts to achieve greater cost savings, have a stronger competitive position in the market and, above all, contribute to the circular economy,” Entwistle said.
At the same time, the cost of building and operating wireless networks is increasing “significantly,” the senior executive said, noting that the price of telecommunications equipment paid in US dollars increased by more than 24% between 2020 and 2023.
Financial results
Earlier in the day, Telus said it increased its quarterly dividend after announcing that its first-quarter profit fell compared to last year.
The telecommunications company said it will now pay shareholders a quarterly payment of 38.91 cents per share, up from its previous rate of 37.61 cents per share.
The increased payment to shareholders comes as Telus reported net income attributable to common shares of $127 million, or nine cents per share.
The result was down from profit of 217 million, or 15 cents per share, in the same quarter last year.
The results were “in line with, if not slightly better than, forecasts,” RBC analyst Drew McReynolds said in a note.
Operating and other income for the quarter totaled 4.93 billion, down from 4.96 billion for the same period in 2023.
On an adjusted basis, Telus says it earned 26 cents per share in its most recent quarter, down from an adjusted profit of 27 cents per share at the same time last year.
But Mr. Entwistle told shareholders that he was so confident in the company’s future that he would receive his entire salary in Telus shares, something he had already done from 2010 to 2015.
Mr. Entwistle’s total compensation for 2023 was $19.1 million, up 16% from 2022, according to materials distributed to shareholders for the meeting.
Strong competition
Telus recorded a total of 209,000 net customer additions across its telecommunications services in the first quarter, up 28.2% from a year earlier and marking its best result ever for a three-month period, a indicated the company.
But the 45,000 net mobile subscriber additions during the quarter were down 4.3% from the same quarter a year earlier.
Telus’ churn rate for mobile subscribers – a measure of subscribers who canceled their service – was 1.13%, up from 0.9% in the previous first quarter. According to the company, this was largely due to “more aggressive marketing and promotional activities.”
Financial services chief Doug French said competition in February “was probably more intense” than he’s seen in the industry in a very long time.
Telus’ average revenue per mobile phone user was $59.31, down $1.07 or 1.8% from the prior year’s first quarter. The company attributed the decline to customers increasingly subscribing to basic plans with lower prices, as well as more promotions targeting both new and existing customers.
These factors, along with a decline in excess revenue, were partly offset by a rise in roaming revenue resulting from increased travel.
reference: www.lapresse.ca