Vancouver, B.C. – TELUS today announced certain first quarter ended March 31st, 2009 wireless subscriber information. First quarter 2009 wireless segment financial results are expected to be adversely impacted by lower than expected wireless net additions and average revenue per unit (ARPU). Wireless operating results are being impacted by a weak macro-economic environment, reflect the acceleration of a negative trend first observed in the fourth quarter of 2008, and are below TELUS' expectations.
|Wireless subscriber information|
3 months ended March 31
|Subscriber gross additions – total (000s)|
|Subscriber net additions - total (000s)|
|Total wireless subscribers (000s)|
|Churn, per month (%)|
The above subscriber information is based on preliminary quarter end results and will be reviewed through normal internal and audit committee quarterly assurance processes in the coming weeks. TELUS plans to release detailed first quarter financial operating results and host an investor conference call on May 7, 2009, as previously announced.
Year over year gross additions were stable for the first quarter of 2009. Notwithstanding this, wireless subscriber net additions of 48,000 represented a 46% decline year over year. Weakness in wireless net subscriber additions in the first quarter of 2009 is primarily attributable to the combination of a lack of customary growth in gross additions combined with an increase in deactivations. The deactivations were due to a larger subscriber base along with an increase in the churn rate amongst business customers impacted adversely by the current economic environment. The growth rate of 0.3% in wireless subscriber gross additions for the first quarter of 2009 compares to 4.8% and 17% growth, respectively, generated for the fourth quarter and year ended December 31, 2008. The worsening trend is believed to be primarily due to the weakening Canadian economy including: lower consumer confidence and a resulting decrease in retail sales including customer deferral of buying decisions; lower and more cautious business spending; and lower employment levels.
Similarly, TELUS has experienced a decline in ARPU. Wireless ARPU is being impacted by: lower service revenue from our Mike line of business; increased proportion and use of lower per minute rate plans including greater use of in-bucket minutes; and decreased roaming revenues. This can be attributed to the continued highly competitive market and the ongoing global economic recession increasingly being experienced in Canada, which is particularly acute for our Mike push-to-talk business-oriented service. Mike is commonly used in economically sensitive business sectors such as manufacturing, automotive, construction, transportation dispatch, and energy.
TELUS (TSX: T, T.A; NYSE: TU) is a leading national telecommunications company in Canada, with $9.7 billion of annual revenue and 11.6 million customer connections including 6.1 million wireless subscribers, 4.2 million wireline network access lines and 1.2 million Internet subscribers. Led since 2000 by President and CEO, Darren Entwistle, TELUS provides a wide range of communications products and services including data, Internet protocol (IP), voice, entertainment and video. In support of our philosophy to give where we live, TELUS, our team members and retirees have contributed $135 million to charitable and not-for-profit organizations and volunteered more than 2.6 million hours of service to local communities since 2000. Nine TELUS Community Boards across Canada lead our local philanthropic initiatives. For more information about TELUS, please visit telus.com.
This document contains statements about expected future events and financial and operating results of TELUS Corporation that are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that the assumptions, predictions and other forward-looking statements will not prove to be accurate including 2009 guidance. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause actual future results and events to differ materially from that expressed in the forward-looking statements. Accordingly this news release is subject to the disclaimer and qualified by the assumptions, qualifications and risk factors referred to in this news release or TELUS' reports, comprehensive public disclosure documents including the 2008 Annual Report, Annual Information Form and quarterly interim reports and in other filings with securities commissions in Canada and the United States.
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