(Montreal) Cogeco Communications must postpone the construction of certain projects due to the disruption of the supply chain and longer than expected delays in obtaining permits.
Posted at 1:05 p.m.
“There is part of this decline which is linked to the state of the economy and the supply chain, explained the president and chief executive officer of the Montreal cable company, Philippe Jetté, during a conference call. to discuss the most recent quarterly results on Thursday. There are pieces of equipment that take longer to obtain. Some projects have been postponed. »
The spread of the Omicron variant has also slowed the process of obtaining permits in US cities and states, he added. The leader says he is “optimistic” that the company will be able to pick up the pace of work in “the next few quarters”.
Management has therefore revised downwards its capital expenditure forecast for the 2022 financial year (which will end at the end of August) due to these delays. The company now expects capital expenditures of between 720 million and 750 million, compared to the initial forecast of between 815 million and 845 million.
While some projects are postponed, Chief Financial Officer Patrice Ouimet does not expect the size of capital spending to be unusually higher in fiscal 2023. “It’s still a bit early to talk about 2023. We will unveil our forecast in July. I would say that we should be close to the forecast that we had initially made for the year 2022.
Questioned on the subject, Mr. Jetté said that he had nothing new to say about a possible entry into the wireless telephony market.
The cable company is still waiting to find out the regulatory conditions that would allow it to lease access to the networks of major Canadian telecommunications companies. The CEO is still awaiting details from the Canadian Radio-television and Telecommunications Commission (CRTC) in this regard.
Last year, the CRTC had already ruled that regional operators could access the networks of large telecoms on condition that they themselves have a local frequency spectrum. “We are still waiting for the details,” replied Mr. Jetté. They did not share any information with anyone. »
In the second quarter, the company unveiled results that beat analysts’ expectations while net profit rose 8.5% and revenues rose 14.8%.
Net income for the quarter ended February 28 reached 119.9 million, compared to 110.6 million for the same period last year. Adjusted earnings per share reached $2.38, compared to $2.14. Revenues, for their part, reached 728.5 million, against 634.5 million.
Prior to the earnings release, analysts had expected earnings per share of $2.21 and revenue of $728.2 million, according to data from the firm Refinitiv.
“Results are broadly in line with expectations, except for lower than expected capital expenditures,” said Drew McReynolds of RBC Capital Markets.
Around noon, the action of Cogeco Communications gained $3.90, or 3.63%, to $111.28 on the Toronto Stock Exchange.
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