Company reported 17 per cent higher net income in the quarter
By Ahmad Hathout
Telus executives said Friday they are not satisfied with where their churn numbers are and are seeking to aggressively bundle products to further reduce the rate of defections from the company.
Last month, the Vancouver-based telecom launched its latest version of its Stream+ product, which bundles three popular streaming services. The telecom’s latest version bundles Netflix, Disney+, and Amazon Prime Video in one package at a reduced rate compared to if a customer were to buy the individual services separately.
Telus executives said Thursday that this is just one example in a broader bundling strategy across the board to keep customers happy.
“When it comes to churn…we have been, of course, ahead of the industry and ahead of our peers, but we’re not satisfied,” Zainul Mawji, executive vice president and president of Telus Consumer Solutions, said on the company’s fourth-quarter conference call Friday, referencing the company’s historically low rate of defections.
“And what it’s taught us from a performance perspective is that we’re going to have to continue to advance our product intensity and bundling plays for all segments of the market and have more attractive bundles for all segments of the market.”
Mawji noted that while the newest video package is the latest effort to differentiate itself from the pack, it will not be the last.
“You can see that in areas like health and other areas that we’re continuing to bundle, and you can see it in our very unique and differentiated content strategy,” she said. “Clients are responding to our desire to see greater product intensity and create greater value from them, and I think you can see that in areas like security and smart home automation, which we will continue to evolve.
“I think those are the kinds of areas that we’ll continue to lean into to improve our churn results,” she concluded.
Total mobile phone churn was up 0.18 points to 1.4 per cent, however, due in part to switching during the promotional season. However, the company touted a full-year of postpaid mobile phone churn of 0.87 per cent, its tenth consecutive year at less than one per cent.
The company also recorded slightly lower average revenue per user per month by 0.3 per cent to $58.50 in the quarter.
However, it added 18 per cent more gross mobile wireless customers for a total in the quarter of 545,000 and a net increase by 12.5 per cent to 126,000 compared to the equivalent period. The total mobile phone base at the end of December 31 was roughly 10.1 million, up 4.1 per cent from last year.
On connected devices, the company added 91.5 per cent more of those for a net gain in the quarter of 203,000 new connections. The total base jumped 26.2 per cent by the end of the quarter to roughly 3.1 million.
Internet net adds were down 14.3 per cent with 36,000 in the quarter, but the total subscriber base increased 8.8 per cent by quarter-end to roughly 2.6 million.
Television net additions were up 35.3 per cent in the quarter as the company added 23,000 new subscribers for a total base by quarter-end of 1.4 million – up 5.2 per cent year-over-year.
Residential landline net losses were 7,000 in the quarter, up 75 per cent from the same period last year, with the total base shaving 2.8 per cent by quarter-end to 1.07 million.
Security systems net additions were 23,000 in the quarter, down 18 per cent compared to the equivalent period. The total base for that segment was up 8 per cent to 1.06 million.
Revenues were up 2.8 per cent to $5.2 billion, attributable to higher service revenues in telecom and Telus International.
Net income was up 17 per cent to $310 million, which was attributed to EBITDA growth and “unrealized appreciation” from renewable energy projects.
