SaskTel reports $119M in net income, missed targets for 2019-20
REGINA -- SaskTel wasn’t immune to the effects of COVID-19, according to its 2019-20 financial report released on Wednesday.
The provincial telecommunication crown corporation is reporting revenue growth in 2019-20, but it missed its targets and faces an uncertain year ahead due to the pandemic.
"It is clearly going to have a financial impact on us," SaskTel President and CEO Doug Burnett said. "The exact amount is a little uncertain still, but it will depend on the duration of the pandemic.
SaskTel reported a net income of $119.8 million and operating revenue of more than $1.2 billion, leading to a year-over-year revenue growth of $5.8 million.
SaskTel receives revenue mostly through its wireless network services, which make up 44.9 per cent. MaxTV Service, internet and data make up 29.5 per cent of SaskTel’s revenue and local access and long-distance make up 15.2 per cent.
While revenue was strong, it fell short of SaskTel’s financial targets of an 11.1 per cent return on equity due to a $10.7 million impairment loss in the fourth quarter stemming from the pandemic.
SaskTel’s dividend payment to the Crown Investment Corporation dropped by $9.1 million.
"This will be certainly something that CIC will want to look at carefully to make sure that we’re challenging the management at SaskTel as much as we can," Don Morgan, the Minister Responsible for SaskTel, said.
During the pandemic, SaskTel waived data overage fees for customers as many set up to work from home.
The NDP believes SaskTel should continue to provide more flexibility for people struggling to pay their phone, TV and internet bills by extending payment deferrals.
"For a household that’s been without a job and that’s facing financial hardship, we should allow an extended period to pay back those deferrals," Trent Wotherspoon , the NDP Finance Critic, said.
The NDP is also calling on the crown corporation to enhance internet access in rural and northern communities.
SaskTel says it spent $263 million dollars on capital improvements across the province over the past year and the company is considering increasing capital spending this year in an effort to help the province’s economy.
In 2019-20, SaskTel saw an increase in subscribers for broadband internet, wireless and fibre services, while landline subscribers dropped by 7.5 per cent.