MTS' broadband, converged IP revenues rise 6 percent to $55M

Manitoba Telecom Services' broadband and converged IP services drove up the Canadian service provider's Q2 wireline revenue stream 6 percent to $55 million due to increases in both Internet and IPTV revenues.

The telco reported gains in both Internet and IPTV revenues.

Internet revenues were up $1 million to $28 million due to a 5.8 percent increase in its broadband subscriber base. Driven by 5.5 percent growth in subscribers, IPTV revenues rose to $19.7 million.

Over 200,000 customers in Manitoba subscribe to MTS' high-speed Internet plans, while 82 percent of MTS's growing IPTV customer base subscribes to its premium Ultimate TV service. What's more, in the second quarter MTS increased the number of customers with bundled services by 5.1 percent, to 99,418.

Similar to fellow Canadian telco Bell Aliant, MTS is in the process of rolling out its own fiber to the premises (FTTP) FiON network in 14 cities. Among the cities to get the FTTP service this year are a number of new housing developments within Winnipeg and three other cities, including: Stonewall, Beausejour, and Lorette. 

MTS said that the growth in wireless, broadband and converged IP services, "generated 5.1% revenue growth in Q2 2013, which offset declines in local, long distance and legacy data revenues."

Local access revenues declined $3 million year-over-year to $62 million, a factor it attributes to lower revenues from losses of traditional wireline voice subscribers to wireless substitution and local cable competition.

Likewise, long distance revenues declined $1.0 million to $9.8 million due to what it says is "decreased long distance rates and customers replacing long distance calling with email, text messaging and social networking." Finally, legacy data revenues declined to $7.3 million, as more customers migrated to converged IP services.

The second quarter was a transitional time for MTS.

In May, MTS reached an agreement to sell off Allstream business services unit to Accelero Capital for $504 million. By making this deal, Allstream will be able solely focus on serving the enterprise services market, while MTS can focus more of its attention on growing its emerging 4G LTE wireless, FTTP and IPTV business lines.

"After announcing the sale of Allstream on May 24, 2013, following a successful review process, MTS moves forward as a stronger, more focused and more stable company," said Pierre Blouin, CEO of MTS, in the earnings release.

Shares of MTS were listed at $34.13, up 12 cents, or 0.35 percent in Monday morning trading on the Toronto stock exchange.

For more:
- see the earnings release (.pdf)

Special report: Wireline telecom earnings in the second quarter of 2013

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