Telus executives warned they expect extended pressure on financial results due to conditions created by Covid-19 (coronavirus), as Q1 profit fell and the operator deferred a planned increased to its quarterly dividend.

Net income dropped 19.2 per cent year-on-year to CAD353 million ($252.4 million), despite a 5.4 per cent increase in revenue to CAD3.7 billion. Wireless revenue declined 2 per cent to CAD1.89 billion, in large part due to a 12.4 per cent drop in equipment sales to CAD374 million related to the closure of 90 per cent of its retail locations in Q1.

The company added 70,000 mobile subscribers, up from 60,000 in Q1 2019.

On an earnings call, CEO Darren Entwistle said board decided to defer a scheduled increase for its dividend payable in July as it works to manage financial resources during the pandemic, but hopes to announce an increase when it issues Q3 results in November.

In a press release, CFO Doug French added the company identified $250 million in cost saving initiatives to further mitigate the impact of the outbreak.

Jim Senko, president of Telus’ mobile division, flagged equipment and roaming revenues as key issues, cautioning the impacts of the pandemic could outlast store closures and lockdowns as “customers will be hesitant to return to the mall, and hence returning to business as usual will take time”.

He noted travel, and thus roaming revenue, is expected to “slowly come back over time”.