Revenues dropped in 2020, EBITDA margins increased in 2020: CRTC CMR report

Overall, telecommunications companies pulled in some $53.4 billion in 2020, a 1.4 per cent decrease in overall revenues compared to 2019, according to the most recent edition of the CRTC's Communications Monitoring Report released Wednesday. The report, which compiles telecommunications data from 2020, attributes the majority of the almost $1 billion decline in mobile revenues to the decline in roaming revenues flowing out of the COVID-19 lockdowns. Mobile revenue overall dropped 3.3 per cent to $27.9 billion. That is the first recorded drop in mobile revenue since the CRTC started keeping track of the number. "The decline could be attributed to several key factors such as more people worked from home who may have resorted to alternative voice solutions i.e. home phone service, skype, zoom, MS Teams, etc…. and the drop in international roaming revenues as global travel restrictions were imposed and enforced throughout 2020," according to the report. With "the restrictions to retail stores and malls, this had a direct impact on mobile equipment and device sales as store traffic was severely reduced or halted altogether." Retail fixed internet grew by some 4.3 per cent, to $14.1 billion. The drop in overall revenues, however, was matched by higher profit margins, when measured by earnings before income tax, debt, and amortization. Large incumbents and cable companies – including BCE Inc., Rogers Communications Inc., Telus Corp., Shaw Communications Inc., and Quebecor Inc. – still generated a combined 86.9 per cent of revenues, despite shrinking 1.5 per cent for incumbent telecommunications and 1.8 per cent for the larger cable-based carriers. Smaller facilities-based carriers generated lile Xplornet Communications Inc. accounted for 3.7 per cent of the revenue share, while they grew 9.3 per cent from 2019 to 2020. Wholesale-based service providers like Distributel Inc. and TekSavvy Solutions Inc. accounted for 35 per cent of the revenue share, and shrunk by 8.4 per cent. As with the year previously, revenue from mobile wireless service accounted for 53.3 per cent of all revenues generated, followed by fixed internet with 26.4 per cent of all revenues. Capital expenditures in the industry dropped 3.9 per cent overall from the previous year, with wireline accounting for a 3.5 per cent decline and wireless dropping by five per cent. Overall, telecommunications companies spent just under $8.6 billion on their wireline sectors in 2020, while in 2019 they spent just over $8.9 billion. In wireless, the companies spent $2.77 billion in 2020, compared to $2.94 billion in 2019 EBITDA margins increased in wireless from 43.8 per cent to 46 per cent from 2019 to 2020, while for wireline margins fell slightly from 36.7 per cent to 36.1 per cent. Overall, telecommunications EBITDA margins rose from 40.5 to 41.3 per cent. — Reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca.

Revenues dropped in 2020, EBITDA margins increased in 2020: CRTC CMR report

News | December 15, 2021

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Revenues dropped in 2020, EBITDA margins increased in 2020: CRTC CMR report

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