Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Quebecor Inc (QBCRF, Financial) reported its best-ever quarterly wireless loading performance with 132,000 net additions and a year-over-year increase of 352,000 new lines.
- The company achieved a significant milestone with 4,050,700 total mobile active lines across its brands, marking substantial growth in a short period.
- Quebecor Inc (QBCRF) continues to outperform competitors by offering lower prices and better customer service, as evidenced by a survey rating it as the top telecommunications company for customer service.
- Wireless EBITDA increased by 17% to $271 million, with an improved EBITDA margin from 40.5% to 45% compared to the previous year.
- The company successfully issued US$700 million of senior notes in the US investment grade market, yielding 5.1% on a fully hedged basis, to refinance existing debt.
Negative Points
- Quebecor Inc (QBCRF) faced a 1.8% decline in consolidated revenues to $1.4 billion and a $30 million decrease in EBITDA, largely due to a $26 million negative stock-based compensation variance.
- The CRTC's decision on fiber internet network access rates was disappointing, preventing Quebecor Inc (QBCRF) from launching services on these networks and denying Canadians better service and lower prices.
- The media segment reported a $4 million unfavorable change in EBITDA due to a decline in advertising revenues and the impact of the new federal digital service tax.
- Wireline revenues decreased by 2.2%, mainly due to lower wireline services and equipment revenues, impacting overall telecom segment performance.
- The company anticipates continued pressure on wireless ARPU due to the dilutive impact of Freedom's prepaid services and higher promotional discounts.
Q & A Highlights
Q: Do you feel the need to change your strategy in light of industry changes, or is the acquisition of Freedom Mobile sufficient?
A: Pierre-Karl Peladeau, President and CEO, stated that Quebecor does not intend to change its course. The company remains focused on leveraging the Freedom Mobile acquisition and expanding its footprint. They are working to convince the CRTC to review decisions that impact their ability to bundle services effectively.
Q: Can you share the direction of ARPU for your different brands?
A: Pierre-Karl Peladeau explained that Videotron is their premium brand, and they have established a market share over a decade. The company is focusing on offering competitive prices and a 100% digital experience with Fizz, which resonates well with certain market segments.
Q: How should we think about revenue growth in wireless given your pricing strategy?
A: Pierre-Karl Peladeau emphasized that Quebecor is committed to maintaining its pricing strategy to gain market share. The company is focused on improving network quality and customer experience, which they believe will drive growth despite competitive pressures.
Q: Can you comment on the quality of wireless loading and any changes in acquisition costs?
A: Hugues Simard, CFO, noted that while there is some prepaid growth, the focus is on reducing churn across all brands. The company is seeing improvements in customer retention, which indicates the quality of their loading.
Q: What are your thoughts on the need for a premium offering and network investment?
A: Pierre-Karl Peladeau acknowledged the importance of network investment but emphasized spending wisely. Quebecor aims to improve its network efficiently without unnecessary expenditure, leveraging its existing assets for future opportunities.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
