events archive
events archive
Q2 2005 investor conference call - George Cope presentation
Thank you, Darren and good morning everyone.
We can turn now to slide 10.
Let me begin with a few comments on the wireless industry. As you can see, the Canadian wireless industry continues to grow at a robust pace. At the end of the second quarter, penetration stood at about 49 percent. This represents a more than 5 percent expansion from this time last year and shows the market continues to accelerate with the three players on a national basis. The 12-month net additions include more than 400,000 industry net adds in the second quarter of 2005, a solid 1.4 point penetration gain in the second quarter alone.
Next slide, TELUS mobility once again had an excellent quarter as almost all key operating and financial metrics improved year over year. Our strategy of profitable subscriber growth continues to be successfully executed as illustrated on this slide. While capturing our fair share of net additions, we are achieving a disproportionate share of EBITDA and cash flow growth. TELUS mobility is now generating more EBITDA and free cash flow than our two major competitors despite having fewer subscribers.
Turning to slide 12, in this quarter, TELUS mobility's industry-leading ARPU continued this quarter. Accelerating data sales, MOU expansion and price increases resulted in ARPU improving for the 10th consecutive quarter over quarter period. Of note, post-paid ARPU increased from 66 to $68 despite increased competitive pressures. As well, on July 1st, as pre-announced, we increased our evening and weekend clock to begin at 9:00 p.m. from 8:00 p.m. and increased the price of the 6:00 p.m. start time from $5 to $7 for all new clients. We grandfathered all previous clients. In the first month, over 80 percent of those who chose the EW option took the $7, 6:00 p.m. option in essence adding a $2 price increase to those choosing the EW option of 6: 00.
Next slide, I am very pleased with now efficiently we are achieving subscriber and revenue growth. TELUS mobility experienced its best Q2 subscriber growth in its history yet was able to reduce cost of acquisition 11 percent year over year and reduce our cost of acquisition over lifetime revenue to an all-time low of 8 percent. These results bode well for future EBITDA margin expansion at TELUS mobility.
Next slide. Finally, the increase in subscribers combined with tight cost control, produced an EBITDA network margin of 49 percent and free cash flow margin of 31 percent. TELUS mobility has now achieved the status as the move the profitable wireless Canada in North America in terms of margin an achievement the entire TELUS team is very proud of. With that, I'll hand the call over to Bob Mcfarlane. Bob, over to you.
Q2 2005 investor conference call - presentations
John Wheeler, vice-president, investor relations
Darren Entwistle, president and chief executive officer
George Cope, president and chief executive officer, TELUS Mobility
Robert McFarlane, executive vice-president and chief financial officer
Question period
Back to Q2 overview