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Aliant Announces 2005 Financial Results

- Year shows strong recovery from the 2004 labour disruption

    ATLANTIC CANADA,Jan. 26 2006 --- 
Aliant Inc. (TSX: AIT) today announced
its fourth quarter and year-end results for 2005 and issued its financial
guidance for 2006. Consolidated revenues for 2005 were up 3.1 per cent year
over year and net income increased 52.6 per cent to $199.4 million for the
twelve-month period ended December 2005. The return to normal business
operations in 2005, after the labour disruption of 2004, was a major
contributor to the 60.4 per cent growth in earnings per share (EPS) of $1.46
versus $0.91 the previous year. Revenue growth in the wireless and Internet
businesses and diligent expense management also contributed to the growth in
revenues and earnings.

    2005 Results

    "This has been a very solid year for the company as we achieved strong
operating and financial results for 2005," commented Jay Forbes, President and
CEO. "It was also a year of significant challenge and transition for our
employees, who are to be commended for rebuilding our momentum so quickly.
Thanks to their dedication and unwavering commitment to our customers, we are
moving into 2006 with a strong focus on each segment of our business and are
well positioned for continued success in the year ahead."
    Operating revenues for 2005 were up 3.1 per cent to $2.1 billion over
2004, driven by growth in all areas, with the exception of traditional local
and long distance services. Wireless revenue grew 13.8 per cent over 2004
driven by an 11.9 per cent increase in our customer base and a 4.0 per cent
increase in average revenue per customer. Internet revenue grew 10.7 per cent
for the year, driven by year-over-year high-speed Internet customer growth of
41.8 per cent and high-speed Internet revenue growth of 24.5 per cent.
    Fourth quarter revenues for the telecommunication business were up
5.2 per cent to $480.1 million compared to the previous year. Wireless
operating revenues for the fourth quarter rose 13.1 per cent year over year,
driven by successful marketing programs that resulted in subscriber net
activations of 30,278 for the quarter and growth in revenue generated per
customer of 2.2 per cent compared to the same quarter in 2004. Internet
revenues for the fourth quarter grew 20.0 per cent compared to the previous
year primarily due to strong high speed Internet revenue growth of
40.1 per cent on very active migration of dial customers to high speed and the
rollout of the successful PC purchase program that complemented Aliant's
Internet service offering.


    Fourth Quarter and 2005 Year End Financial Highlights
                            Three Months                 Twelve Months
                         ended December 31             ended December 31
    ($ millions
     except per
     share amounts)   2005      2004   % change     2005      2004   % change
    Total operating
     revenue        $534.9    $509.8      4.9%  $2,096.7  $2,033.4      3.1%
     income         $105.2     $25.8         -    $394.9    $269.5     46.5%
    Net income       $55.2      $7.5         -    $199.4    $130.7     52.6%
    Earnings per
     common share    $0.41     $0.04         -     $1.46     $0.91     60.4%
    Weighted average
     common shares
     (millions)      127.7     132.6     -3.7%     130.0     132.7     -2.0%

    xwave's service revenue grew 15.9 per cent in the fourth quarter compared
to the same period in 2004. This growth is mostly as a result of new
contracts, more focused sales effort and an acquisition in late 2004. In the
fourth quarter of 2005, xwave announced the signing of a significant contract
with General Dynamics Canada, part of the Sikorsky Aircraft-led Maritime
Helicopter Team, to develop ground-based simulators and software in support of
Canada's new CH148 Cyclone helicopters. This builds on the $200 million
contract xwave signed with L-3 Communications in early 2005 to deliver
mission-critical information systems as part of the Maritime Helicopter
    Aliant's consolidated operating income for 2005 grew 46.5 per cent
compared to the previous year as a result of the strong recovery from the 2004
labour disruption and the early retirement incentive program that removed an
estimated $39 million in operating expenses in 2005. This contributed to
strong operating cash flow of $524.3 million for the year. Capital investments
were higher at $363.2 million as Aliant re-established its pace of investment
after the labour disruption of 2004 and continues to expand its wireless and
Internet infrastructure to service Atlantic Canadians.

    2006 Outlook
    For 2006, Aliant expects to achieve the following ranges of results for
key financial reporting indicators. The earnings per share forecasted below
includes a one-time, non-cash, accounting impact from the anticipated exercise
of two interest rate derivative contracts, the loss on which is currently
estimated to be $0.14 per share. Further details can be found in Management's
Discussion and Analysis for the year ended December 31, 2005.

    (millions of dollars, except earnings per               2006 Guidance
     share amounts)                                        Low         High
    Operating revenues                                   $ 2,150     $ 2,200
    Earnings per share                                    $ 1.40      $ 1.46
    Earnings per share, excluding derivative
     accounting loss                                      $ 1.54      $ 1.60
    Cash from operating activities                         $ 520       $ 560
    Capital investments                                    $ 350       $ 380

    "Our 2006 guidance reflects the confidence we have that our strategy will
continue to generate strong earnings and cash flow as we provide our customers
with the most up-to-date technology and services," Mr. Forbes concluded.

    Dividend Increase
    In 2005, Aliant increased its common share dividend by 7.3 per cent to
$1.18 per common share, up from $1.10 per common share the previous year.
Today, Aliant's Board of Directors declared a common share dividend of $0.31
per common share, payable on March 30, 2006 to shareholders of record on
March 15, 2006, an increase of 5.1 per cent over the 2005 rate. Aliant's Board
also declared a preferred share dividend of $0.340625 per preferred share
payable on March 31, 2006 to shareholders of record on March 15, 2006.

    Normal Course Issuer Bid
    To date, Aliant has purchased 5,797,715 shares through a normal course
Issuer Bid (NCIB) that is due to expire on February 3, 2006. All common shares
of Aliant purchased pursuant to the NCIB have been cancelled. Today Aliant's
Board of Directors also approved the renewal of the NCIB.

    About Aliant
    Through approximately 2.5 million customer connections, Aliant serves
consumers across Atlantic Canada with innovative and traditional
communications services, including local and long distance telephony,
wireless, Internet, e-commerce, interactive multimedia, data and managed
network services. In addition to serving residential, small-to-medium sized
business and enterprise customers in its home market, Aliant also serves
business customers located in other parts of North America. Aliant complements
its industry-leading telecommunications business with strengths in information
technology solutions and knowledge-services applications. Aliant's
approximately 8,400 employees build on its 100-plus year history by
collaborating to deliver the highest quality of customer service, choice and
convenience. Aliant has a market capitalization of approximately $3.7 billion.

    Analyst conference call
    A conference call is scheduled for Friday, January 27, 2006 at 8:30 a.m.
(ET), (9:30 a.m. Atlantic, 10:00 a.m. NL). The dial in number is
(416) 695-9753 or (877) 461-2814. Media are invited to attend in a listen-only
mode. The title of the call is "Aliant Year End and Fourth Quarter 2005
Financial Results." A replay of the session can be heard from January 27 at
11:00 a.m. (ET) to February 3 at midnight (ET). To access the replay, dial
(416) 695-5275 or (888) 509-0081.

    Forward-looking Statements
    This news release, contains forward-looking statements related to the
future financial condition and results of operations of Aliant. These
statements are based on current expectations and estimates, as of January 26,
2006, about the markets in which Aliant operates and management's beliefs and
assumptions regarding these markets. These statements are subject to important
risks and uncertainties which are difficult to predict and assumptions which
may prove to be inaccurate. Please refer to Aliant's Notice Concerning Forward
Looking Statements dated January 26, 2006 for a discussion of these key
assumptions and risk factors. Should any factor impact Aliant in an unexpected
manner, or should assumptions underlying the forward-looking statements prove
incorrect, the actual results or events may differ materially from the results
or events predicted. All of the forward-looking statements made in this
document are qualified by these cautionary statements, and there can be no
assurance that the results or developments anticipated by Aliant will be
realized or, even if substantially realized, that they will have the expected
consequences for Aliant. Readers should not place undue reliance on any
forward-looking statements.

    Aliant's complete quarterly documents including Management's Discussion
and Analysis, Financial Statements and Notes, Supplemental Financial
Information and Notice Concerning Forward Looking Statements can be found on


For further information: Media Relations: Kelly Gallant, (902) 487-4642,; Investor Relations: Ian
Chadsey, (506) 694-2220, ;
Archived images on this organization are searchable through CNW Photo Archive
website at Images are free to
accredited members of
the media.

SOURCE Alliant

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