June 28, 2018 / 3:50 PM / 3 months ago

Shaw Communications posts surprise loss on Corus investment charge

(Reuters) - Canadian telecom company Shaw Communications Inc (SJRb.TO) reported a surprise quarterly loss on Thursday as it booked an impairment charge related to its investment in media company Corus Entertainment Inc (CJRb.TO).

FILE PHOTO: The Shaw logo is pictured on their Barlow Trail building, home to the annual Shaw AGM, in Calgary, Alberta January 14, 2014. REUTERS/Todd Korol/File Photo

Shaw Communications’ shares were down 4 percent at C$26.61 on the Toronto Stock Exchange.

Corus has been struggling with weakness in its television and advertising businesses, and missed revenue estimates in the latest quarter.

Shaw took a C$284 million ($214.37 million) charge related to its nearly 40 percent stake in Corus in the third quarter ended May 31. The company is reportedly looking to offload its Corus stake.

Calgary-based Shaw posted a loss of C$91 million, or 18 Canadian cents a share, compared with a profit C$133 million, or 27 Canadian cents per share, a year earlier.

Analyst were estimating a profit of 36 Canadian cents per share, according to Thomson Reuters I/B/E/S.

Shaw has been investing heavily in its wireless business, with a focus on the next-generation 5G technology. It successfully completed its first trial of the technology in Calgary earlier this year.

The company added 46,659 net subscribers in its wireless unit, while average revenue per user rose more than 7 percent to C$39.84.

The company’s wireline business, its biggest, reported revenue of C$1.06 billion, which was flat compared with a year earlier. Shaw said it was on track to meet its 2018 forecast.

“...Our focus is on Wireline margin. We’ll see Internet results bounce back to positive in the next quarter...,” Shaw Communications President Jay Mehr said on a post-earnings call.

Revenue rose 7 percent to C$1.3 billion, slightly lower than analysts’ expectations of C$1.31 billion.

Reporting by Parikshit Mishra; Editing by Saumyadeb Chakrabarty and Anil D'Silva

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