Active Stock to Observe: Shaw Communications Inc Class B (NYSE: SJR)
On Wednesday, Shaw Communications Inc Class B (NYSE: SJR) stock gained 2.39% and closed at 17.99. The stock opened the session at $17.73 and touched its highest price point at $18. Its recent trading capacity is 740994 shares versus to its average trading volume of 563330 shares. The company stock lowest price point for the session stood at $17.7.SJR traded as low as $ 12.2 in the past 52 weeks, and shares hit its peak level to $20.9.
Shaw Communications Inc declared consolidated financial and operating results for the quarter ended May 31, 2020, including the impact of adopting IFRS 16, Leases (IFRS 16). Consolidated revenue reduced by 0.8% to $1.31B and adjusted EBITDA increased 15.3% year-over-year to $609M. Removing the $38M impact from IFRS 16, adjusted EBITDA increased about 8.1% over the previous year.
In the quarter, the Company lost about 5,500 net Wireless RGUs 2, consisting of 2,200 postpaid additions and 7,700 prepaid losses. The lower net additions reflect the closure of about 90% of its corporate locations during the period and management’s focus on serving its existing base of consumers. As retail locations are able to resume operations, substantially all of Freedom Mobiles retail stores are now open for business as of June 30, 2020.
Wireless service revenue for the three-month period increased 17.0% to $206M over the comparable period in fiscal 2019Because of the increased subscriber base and growing penetration of Big Gig data plans. Third quarter ABPU grew by about 5.7% year-over-year to $44.27 and ARPU increased 2.6% to $38.94 reflecting the increased number of wireless consumers subscribing to higher service plans, partially offset by lower roaming revenue in the quarter Because of less travel and roaming outside of the Freedom network.
Wireless equipment revenue for the three-month period reduced 37.0% year-over-year to about $46M, reflecting lower subscriber sales and activity in the quarter as a result of the temporary retail store closures. Third quarter Wireless adjusted EBITDA of $101M increased 90.6% year-over-year, or about 56.6% when removing the $18M impact resulting from the adoption of IFRS 16. The accelerated growth in Wireless adjusted EBITDA in the quarter was primarily Because of lower subscriber activations and therefore lower acquisition related costs. While the financial performance of the Wireless section was strong in the third quarter, showcasing the operating leverage in the business, the Company’s strategy remains to scale the wireless business and continue to grow the subscriber base. Therefore, as retail locations continue to re-open, and Canadians start to revisit their wireless needs, the Company will continue to make the appropriate investments to balance subscriber growth and profitability.
COVID-19 Update
The severity and duration of impacts from the COVID-19 pandemic remain uncertain and management continues to focus on the safety of our people, most of whom continue to work from home, connectivity of our consumer base, compliance with guidelines and requirements issued by various health authorities and government organizations, and continuity of other critical business operations. During the third quarter, the Company experienced a reduction in overall wireline and wireless subscriber activity, reduced wireless equipment sales, an improvement in wireless postpaid churn, a raise of about 50% in wireline network usage as well as extended peak hours, increased demand for wireless voice services by about 25%, a decrease in wireless roaming and overage revenue, a $5M increase in bad debt expense and the suspension, cancellation, or reduction of Business consumer accounts, impacting Business revenue. While the financial impacts from COVID-19 in the third quarter were not material, the situation is still uncertain in terms of its magnitude, outcome and duration. Consumer behaviors could still change materially, including the potential downward migration of services, acceleration of cord-cutting and reduced ability to pay their bills, all Because of the challenging economic situation. Shaw Business primarily serves the small and medium sized market, who are also particularly vulnerable to the economic impacts of commodity price challenges and COVID-19, including mandated closures or further social distancing restrictions.
We continue to believe our business and facilities-based networks provide critical and essential services to Canadians and will remain resilient in this dynamic and uncertain environment. Management continues to actively monitor the impacts to the business and make the appropriate adjustments to operating and capital expenditures to reflect the evolving environment. The Company confirms that it expects to deliver adjusted EBITDA growth (pre and post IFRS 16) in fiscal 2020 and free cash flow is predictable to be substantially in line with previous guidance, which continues to be supportive of the current dividend levels.
Considering the ongoing presence of COVID-19, the speed at which it develops and/or changes, and the continued uncertainty of the magnitude, outcome and duration of the pandemic, compounded by the commodity price challenges, the current estimates of our operational and financial results which underlie our outlook for fiscal 2020 are subject to a importantly higher degree of uncertainty. Any estimate of the length and severity of these developments is therefore subject to uncertainty, as are our estimates of the extent to which the COVID-19 pandemic may, directly or indirectly, materially and adversely affect our operations, financial results and condition in future periods.
The price moved ahead of 8.20% from the mean of 20 days, 7.97% from mean of 50 days SMA and performed -1.23% from mean of 200 days price. Company’s performance for the week was 10.57%, 7.34% for month and YTD performance remained -11.34%.
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