Copyright 2005 Toronto Star Newspapers, Ltd.
The Toronto Star
January 18, 2005 Tuesday
From Lexis Nexis
Cogeco Cable Inc. is on track to roll out a telephone system within six months, says chief executive officer Louis Audet.
"Telephony now is at the centre of our action," Audet said yesterday during a conference call to discuss first-quarter profit. "We are about to conclude negotiations with key suppliers. We would expect to launch our telephony service in the next six months."
He said pricing and terms for the service have yet to be revealed, but "it will be a well-rounded offer, and fairly priced."
The Montreal-based company swung to a first-quarter profit of $3.8 million on 4.8 percent higher revenue, compared with a big year-earlier loss that was burdened by one-time charges, including accounting changes.
For the quarter ended Nov. 30, earnings amounted to 10 cents a share and contrasted with a loss of $41.1 million, or $1.03 per share, a year earlier.
Revenue rose to $135.8 million from $129.5 million.
Cogeco Cable is a subsidiary of Cogeco Inc., which holds 39.3 percent of the cable company's stock.
Cogeco Inc., which also owns radio and TV stations in Quebec, reported a quarterly profit of $3.1 million, or 19 cents a share, compared with a year-earlier loss of $15.4 million, or 94 cents per share.
Audet refused to answer questions about the phone launch, a service also promised by other cable-TV companies this year, but said $5 million has been allocated to the service.
"The launch of a long-distance package and of a possible wireless-telephone offering to complete our bundlings takes second priority to launching our own (local) telephone phone," Audet told analysts.
Audet also suggested that Cogeco's 886,182 customers, including basic TV service and Internet-only customers, in Ontario and Quebec could face a price increase. He said customers are enjoying good deals, with more products and services being added.
While Cogeco has not in the past been a price-setter, he said, "there is clearly room to reap more value with consumers in a fair manner, in our opinion."
During the recent quarter, Cogeco enjoyed an increase of 42,000 "revenue-generating units," such as basic service, high-speed Internet and digital terminals, compared with 37,560 added in the quarter a year earlier, to bring the total to 1.3 million.