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     News Release - April 10, 2006 SASKTEL REPORTS NET INCOME OF $64.4 MILLION IN 2005 AND ANNOUNCES INTEGRATION OF NAVIGATA
SaskTel today released its 2005 financial results, highlighted by a net income of $64.4 million and operating revenues of $982 million. SaskTel also announced that the business operations of Navigata Communications will be integrated into SaskTel to address the rapid changes in the competitive communications market and to more cost effectively serve its customers.
"Despite operating in an increasingly competitive communications market, SaskTel continues to maintain a financially sound revenue base that allows the company to return benefits to its customers and the province," Minister responsible for SaskTel Deb Higgins said. "SaskTel's first priority is to remain Saskatchewan's communications company by sustaining profitability and long-term value through growth, operational efficiency and capital investment initiatives." "The communications industry is not bound by geographical borders and is highly competitive. In order to remain a strong company that can meet the needs of our Saskatchewan customers, SaskTel's core communications offerings must expand by growing its business out of province," SaskTel president and CEO Robert Watson said. "Navigata will evolve into a 100 per cent owned sales channel, based in North Vancouver, to sell SaskTel developed voice over Internet products (VoIP) out of province as well as support and grow the existing customer base in Western Canada." Under the new structure, the operations and administrative functions of Navigata will be integrated into SaskTel and SaskTel will become the operating entity outside of the province. Navigata was successful in reducing operating losses from 2004 to 2005 by over 60 per cent, however, will show a loss primarily due to a one-time write-down of property, plant and equipment. Financial and operating highlights for SaskTel in 2005 include: • SaskTel has grown its revenues to $982 million in 2005, from $574 million in 1990, despite a reduction in long distance revenues of more than $260 million per year. In the early 1990s, only seven per cent of the Corporation's revenues directly resulted from its growth strategy, today approximately 59 per cent result from its growth strategy. • Dividend of $57.9 declared and $88.3 million paid to Crown Investments Corporation (CIC) in 2005 for a total of $972 million paid in the last 16 years. • Over 2004 - 2005, SaskTel achieved $43.5 million in operational efficiency. Initiatives such as the Early Retirement Program (ERP) and other cost containment measures such as process improvements contributed to the savings realized in 2005. • Debt ratio of 28.3 per cent, down from 72.2 per cent as of December 31st, 1990. • Max™ Interactive Services grew to over 42,000 customers and SaskTel continued to expand the movie offerings of Max Front Row™ video-on-demand service. • Under phase II of CommunityNet, SaskTel deployed 21 out of 57 planned tower sites and now reaches over 80 per cent of the population, serving virtually every community of 200 people or more, and every community of 100 people or more with a school. • SaskTel Mobility's capital expenditures for 2005 totalled $23.4 million with the majority invested in network expansion and improvement. SaskTel Mobility added 25 new cellular sites and three repeaters, 14 of them providing cellular service to areas with no previous cellular coverage. SaskTel Mobility added over 41,000 new accesses in 2005 and its cellular network now spans over 95 per cent of the Saskatchewan population. As well as improving coverage, SaskTel Mobility launched Evolution Data Optimized (EV-DO) networks in Regina and Saskatoon, enabling speeds up to six times faster than what is currently available. • In 2005, SaskTel has partnered with over 140 private Saskatchewan businesses in over 50 locations, paid over $26 million in commissions to its dealers and has spent more than $277 million on materials and services from over 4,000 Saskatchewan suppliers. • Since 1987, SaskTel has invested over $2.7 billion in infrastructure in Saskatchewan. In 2005, a total of $116 million on improving and maintaining our network including the continuing evolution of CommunityNet, SaskTel's wireless network and the Next Generation Access Infrastructure (NGAI) program, resulting in Saskatchewan residents having one of the most sophisticated networks in the world. • Through the Community Investment Program, SaskTel contributed over $3.6 million to 1,600 non-profit and charitable organizations in Saskatchewan. • SaskTel's environment team has developed a new Ecological Strategy to ensure development as a leader in environmental sustainability. • SaskTel has implemented a Representative workforce strategy so our workforce is representative of the diversity of Saskatchewan people. • This year our excellence in customer service was confirmed by a study conducted by J.D. Power & Associates, a global market research firm. In its Canadian Wireless Customer Satisfaction Study, the results rank SaskTel highest in customer satisfaction for contracted wireless service. • For sixth straight year, SaskTel was recognized as one of "Canada's Top 100 Employers" by MediaCorp Canada Inc. • SaskTel's external investment program is increasing in value, fulfilling its goal for the future. Today the estimated value of SaskTel's external investment portfolio is $242 million to $298 million compared to the $116 million net amount invested. About SaskTel SaskTel employs over 3,800 people in communities throughout Saskatchewan and is the leading full service communications provider in the province. It offers competitive voice, data, Internet, entertainment and multimedia services, web hosting, text and messaging services over a state-of-the-art digital network. The Corporation also provides cellular and wireless data services, security monitoring services, directory services, in-room communications services to the healthcare sector through Hospitality Network, telecommunications consulting service through SaskTel International and national communications services through Navigata Communications. Visit SaskTel at www.sasktel.com. -30- For More Information, Contact:
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