Telus (Toronto: T.TO) Q4: Broadband, TV services drove 46% increase in profit

Telus' (Toronto: T.TO) bets on increasing its wireless coverage and continuing to expand its Fiber to the Node (FTTN)-based IPTV service, Optik continued to pay off in Q4 2010.

For the fourth quarter, Telus reported $227 million (USD 229.5 million) in income, up from CAD 156 million (USD 157.7 million) in the same period in 2009. Likewise, revenue was up 4.4 percent to CAD 2.58 billion (USD 2.6 billion), while EBITDA in the last three months of 2010 grew 7.4 percent to CAD 847 million (USD 856.4 million).

"These results demonstrate the success of Telus' strategy to make significant investments over recent years in advanced wireline and wireless broadband infrastructure," said Darren Entwistle, President and CEO in the earnings release. "These investments have underpinned our strong competitiveness and increasing growth in wireless and wireline data services."

Here's a breakout of Telus' key wireline metrics:

  • Wireline Voice Losses: Typical of traditional incumbent wireline operators, Telus continued to see voice line erosion in the fourth quarter. During the quarter, total network access lines (NALs) declined by 55,000 to 3.74 million, down 5.7 percent from a year ago, factors it attributes to cable competition and wireless substitution. However, Telus residential NAL losses of 37,000 were down 8,000 from Q4 2009. Telus attributes the lower Residential NAL losses to bundling options that come with its Optik service and other customer retention offers. However, Business NALs declined by 18,000 because of the migration to IP-based voice services and slower growth in data lines from a number of large enterprise customer wins.
  • Data Growth: Overall data revenues grew 6.7 percent, or CAD 37.4 million (USD 37.8 million), a factor it attributes to the growth of its TV offering, increased Internet and enhanced data and hosting service revenues. Also on the rise was broadband. The launch of Telus' Optik High Speed Internet and Optik TV service in June attracted an additional 18,000 new broadband subscribers, a 64 percent increase over the same period in 2009.
  • Video Growth: Barely a year in service, Telus reported that its FTTN-based IPTV service ‘Optik TV', has gained around 10 percent of potential British Columbian and Albertan pay-TV subscribers. In addition, it 48,000 new subscribers signed up for its revamped Optik product, which now has 314,000 subscriptions and reaches more than 2.1 million households in British Columbia, Alberta and eastern Quebec.

Going forward, Telus expects its free cash growth to continue into 2011, and it has reaffirmed the 2011 consolidated and segmented targets of per share growth of 9 to 22 percent as previously announced in mid-December.

For more:
- see the release
- Reuters has this article
- see FierceTelecom's Q4 earnings summary

Related articles:
Telus' Q3 profit down, but broadband, TV help it beat analyst forecasts
Telus Q2: Cost cutting, video service growth offsets line loss
Telus' Q1 results beat analyst forecasts, but revenue remains flat
Telus' wireline revenues dip, but IP services continue to shine
Weak Canadian economy drives down Telus Q3 earnings
Telus IPTV gains, satellite coverage expands
Telus starts re-selling BCE satellite TV

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