Rogers Communications Inc. is gearing up to sell off its data centres, aiming to rake in a cool billion dollars. The move is part of their strategy to slash debt following their merger with Shaw Communications.
During a recent earnings call, CFO Glenn Brandt confirmed the company's intention to raise funds mainly through selling real estate assets. Brandt assured analysts that the sale of enterprise data centres, which handle third-party sales, won't interfere with their wireless services, as those are managed separately. However, details about which of their 12 Canadian data centres will be put on the market remain undisclosed.
While Rogers plans to unload some properties this year, Brandt acknowledged potential hurdles due to a sluggish real estate market.
The decision to offload real estate comes on the heels of Rogers achieving its $1 billion savings target post-Shaw merger, a whole year earlier than planned. CEO Tony Staffieri emphasized that hitting this milestone doesn't mean they're easing up on efforts to boost efficiency.
Staffieri also highlighted ongoing integration projects and the pursuit of opportunities with vendors to enhance efficiency. He emphasized Rogers' focus on revenue synergies, particularly in expanding their enterprise offerings, especially in Western Canada.
The sale of its Cogeco stake and some U.S. bonds has already helped Rogers chip away at $5 billion of Shaw-related debt, reducing annual interest costs by about $100 million.
Financially, Rogers reported a first-quarter profit of $256 million, a drop from last year's $511 million. However, Jerome Dubreuil of Desjardins viewed the earnings as slightly positive, noting potential for further synergies.
On the wireless front, Rogers saw a nine percent revenue boost compared to last year's first quarter, driven by the integration of Shaw Mobile and subscriber growth. Despite aggressive pricing for lower-cost plans, Rogers is also seeing growth in higher-priced subscriber revenue, especially with the adoption of the Rogers Premium brand and its 5G network offerings.
Looking ahead, Rogers remains optimistic about growth, even amidst anticipated challenges like reduced immigration targets. They expect growth in the range of four to 4.5 percent this year.
Additionally, Rogers announced a 10-year partnership with Comcast during its annual meeting, which aims to enhance entertainment offerings and introduce innovative 10G technologies.
Comentarios