MONTREAL – Bell Canada Enterprises today reported its fourth consecutive quarter of decreased year-over-year residential line losses, and “steady progress” in the operating performance of its wireless and wireline segments as the highlights of its third quarter results for 2008, which were released today.
Bell’s operating revenue increased 1.8% to $3.8 billion over the same quarter last year, and EBITDA is up 2.4% to $1.43 billion over last quarter due to stronger wireless revenues and lower subscriber acquisition costs, combined with relatively stable Bell wireline EBITDA, according to the press release.
"This was a quarter of clear progress against Bell’s strategic imperatives, with improved customer satisfaction, accelerating growth in wireless and ongoing momentum in our consumer and business wireline operations," said George Cope, president and CEO of BCE and Bell Canada, in the statement.
The completion of Bell 100-day plan served to “restructure and re-energize Bell”, the release continues. Launched on July 11, the plan involved the tagline "Today just got better"; the rollout of two new customer-service products, Same Day Next Day service and Express Install; and workforce reductions, among other initiatives.
"We successfully implemented the Bell 100-day plan in the quarter, including the streamlining of our organization, the launch of our new brand, and significant investments in our customer service and broadband wireless and wireline networks," Cope continued.
Additional highlights from Bell’s press release include the following:
– Bell Mobility had 113,000 postpaid net activations, or 49% more than last year, with postpaid churn improving to 1.1% from 1.4%. Total net activations were 117,000, reflecting a decrease in prepaid net activations to 4,000 from 61,000 the year before. Total Bell wireless operating revenues increased by 9.3% and Bell Wireless EBITDA grew by 6.0%.
– Bell’s wireline momentum continued with improvements in residential line losses for the fourth consecutive quarter and improving performance in the high-speed Internet business. High-speed Internet net activations were 33,000 this quarter, compared with 29,000 in Q3 2007, bringing the company’s total high-speed Internet customer connections to 2,046,000. Wireline also delivered EBITDA growth of 0.7% with key contributions from the Bell video and enterprise units.
– Residential local line losses improved by 32,000 to a loss of 72,000 customers this quarter, down from 104,000 in the same quarter last year. Total NAS declined by 10% over the last twelve months. However, total NAS declined by just 5.8% when normalized for the previously announced contract termination with a major wholesale customer and a beginning-of-year adjustment to Bell’s residential NAS base following a review of historical records, reads the release.
– Revenues from Bell’s growth services portfolio of wireless, video, high-speed Internet and other services, such as ICT solutions, grew by 8% and now represent 60% of Bell’s revenues.
– Video revenues increased by 10% to $363 million this quarter due largely to an ARPU increase of $5 to $65. ARPU went up thanks to customer upgrades to higher-priced programming packages and increase retail prices. Video EBITDA was $76 million this quarter, or 16.9% higher than last year.
– Total video subscribers increased by 7,000 this quarter, compared to 3,000 in the same quarter in 2007, to reach a total of 1.838 million. This brings the total number of net new activations in the first nine months of 2008 to 16,000, compared with none in the corresponding nine-month period in 2007. Video subscriber churn increased to 1.4% from 1.3% last year.
– Bell’s overall operating income was $451 million, or 34% lower than Q3 2007 due to restructuring and other charges of $320 million this quarter. These charges include amounts for workforce reduction initiatives, the proposed privatization transaction, and the relocation of employees and the closing of real estate facilities. Adjusted for these charges, Bell’s operating income grew by 3.6%.
– Bell spent $566 million of capex this quarter, or 1.2% less than Q3 2007. Underscoring Bell’s commitment to its strategic imperatives including to accelerate wireless and to invest in broadband networks and services, capital expenditures focused on enhancing the wireless network and the continuing expansion of the fibre-to-the-node (FTTN) program. Bell also invested $741 million in advanced wireless services (AWS) spectrum licences this quarter.
