Quebecor Inc Cl A MV (($TSE:QBR.A)) has held its Q4 earnings call. Read on for the main highlights of the call.
Quebecor Inc. Earnings Call Highlights Strong Growth Amid Challenges
The recent earnings call for Quebecor Inc. presented a largely positive outlook, showcasing strong financial growth, significant subscriber gains, and enhanced customer satisfaction. Despite these achievements, the company acknowledged challenges such as a decline in Average Revenue Per User (ARPU) and regulatory issues in Western Canada. Nevertheless, the positive aspects of the call significantly outweighed the negative ones.
Strong Cash Flow and EBITDA Growth
Quebecor Inc. reported impressive financial results with a 17% increase in cash flow for the fourth quarter and an 18% rise for the full year 2024. Additionally, EBITDA grew by 4% in Q4 and 6% for the year, underscoring the company’s robust financial health.
Wireless Subscriber Growth
The company experienced substantial growth in its wireless subscriber base, adding 88,000 net additions in Q4, which is 21,000 more than the same period last year. This brought the total to 373,000 net new lines, marking a 10% year-over-year increase in subscribers.
Improved Customer Satisfaction
Quebecor’s brands, including Videotron, Fizz, and Freedom Mobile, received high rankings in customer experience indices. Notably, Videotron achieved the top spot in Quebec for in-store experience, reflecting the company’s commitment to enhancing customer satisfaction.
Media Segment Improvement
The TVA Group, a part of Quebecor, showed significant improvement with an adjusted EBITDA of $11 million in 2024. This represents a favorable variance of $17 million compared to the previous year, indicating a positive trend in the media segment.
Debt Reduction and Dividend Increase
Quebecor successfully reduced its net debt-to-EBITDA ratio to 3.31x, the lowest among Canadian telecom operators. The company also announced an 8% increase in its quarterly dividend, reflecting its strong financial position and commitment to returning value to shareholders.
ARPU Decline
Despite the positive financial and subscriber growth, Quebecor faced a decline in consolidated wireless ARPU, which decreased by $1.93 to $34.36 in Q4. This was primarily due to the impact of Freedom prepaid services and Fizz’s entry-level prices.
Wireline Customer Base Decline
The company experienced a slight decline in its internet customer base, with a decrease of 2,000 in Q4. However, there was a year-over-year growth of 5,000 for 2024, indicating a mixed performance in the wireline segment.
Regulatory and Competitive Challenges
Quebecor raised concerns about TELUS receiving lower wholesale rates in Quebec and Ontario, which could lead to competitive disadvantages in Western Canada. This regulatory challenge remains a point of contention for the company.
Forward-Looking Guidance
Looking ahead, Quebecor’s guidance reflects its strategic focus on maintaining a disciplined financial approach, reducing debt, and enhancing customer experience across its brands. The company aims to continue its growth trajectory with a 17% increase in cash flow for Q4 and an 18% rise for the entire year, alongside a 10% year-over-year growth in wireless subscribers.
In conclusion, Quebecor Inc.’s earnings call highlighted a strong financial performance and strategic growth initiatives, despite facing some challenges. The company’s focus on subscriber growth, customer satisfaction, and financial discipline positions it well for continued success in the competitive telecom market.