TORONTO-Rogers Wireless Communications Inc. posted less-than-spectacular fourth-quarter results with average revenue per user falling from $32.06 during the fourth quarter of 1999 to $30.39 during the fourth quarter of 2000, and customer churn rising from 2.37 percent to 2.76 percent during the same time frame.
The company added 146,600 net customers during the quarter, compared with 144,300 net customer additions during the fourth quarter of 1999, with prepaid cellular customers accounting for 66.6 percent of the net additions last year, compared with 51.4 percent in 1999. Rogers’ customer base totaled 2.9 million subscribers at the end of 2000, including 444,000 messaging and data subscribers, compared with 2.6 million at the end of 1999.
Rogers reported revenue for the quarter of $269.6 million, a slight increase compared with the $250.4 million reported during the fourth quarter of 1999. For the year, net revenue totaled $1.007 billion, compared with $888.5 million posted for 1999.
Fourth-quarter net income fell from $14.9 million, or 15 cents per share, in 1999, to a loss of $38.7 million, or 32 cents per share, last year. For the year, net income fell from a loss of $25.8 million, or 25 cents per share, in 1999, to a loss of $70.2 million, or 57 cents per share, last year.
“While the fourth quarter’s financial results reflect a difficult quarter, the rebuilding work done in the year reflects many successes,” said Charles Hoffman, chief executive officer of Rogers Wireless, referring to the company’s new billing system and its re-branding campaign.
Rogers also announced its financing plans for the acquisition of additional spectrum for personal communications services following its winning bids of approximately $259.1 million in Canada’s recent spectrum auction.
The plans include a commitment with its controlling shareholder RCI and AT&T Wireless Services Inc. to provide funding for the total purchase price of the spectrum. The funding is being provided through short-term unsecured loans on arm’s length commercial terms, with RCI advancing about 60 percent of the aggregate loan amount and AWS advancing the remaining 40 percent.
Rogers Wireless also agreed to carry out a rights offering in which it will offer all holders of record of its Class B Restricted Voting Shares and Class A Multiple Voting Shares the rights to purchase its Class B Restricted Voting Shares. Rogers intends the offering to be sufficient to repay all amounts owed under the unsecured loans.
