MONTREAL – BCE ended its final fiscal quarter of 2013 with a 6% increase in its annual common share dividend and EBITDA of almost $2 billion, driven in large part by revenue growth in its Bell wireline business.
The company reported its common share dividend will increase by $0.14 per share to $2.47 effective with BCE’s Q1 2014 dividend, adding that today’s dividend announcement is BCE’s tenth successive increase in five years.
BCE reported Q4 2013 net earnings attributable to common shareholders of $495 million, compared to $666 million in Q4 2012. The year-over-year decrease in net earnings was due to a non-cash gain recognized in Q4 2012 on the transfer of spectrum from Inukshuk to its partners.
Adjusted net earnings attributable to common shareholders were $540 million, an increase of 16.4%, and adjusted earnings per share increased 16.7% to $0.70 from $0.60, mainly as a result of higher EBITDA at Bell.
For FY2013, net earnings attributable to common shareholders were $1,975 million, or $2.55 per share, down from $2,456 million, or $3.17 per share, in 2012. The year-over-year decrease was partly attributable to the CRTC tangible benefits obligation of $230 million that Bell was ordered to pay as part of the acquisition of Astral that was completed in Q3 2013.
The number of wireless customers in Q4 – 7.92 million – increased by 1.3% from the same period a year earlier. BCE also reported a 7.7% increase in total TV subscribers (to almost 2.5 million), and a 3% increase in total high-speed internet subscribers to almost 3.14 million. That was growth was offset by a 6.6% decrease in the number of NAS lines.
Bell Wireless operating revenues increased 3.2% to $1.5 billion in the fourth quarter, with service revenue up 3.7% to $1.36 billion and EBITDA up 10.4% to $529 million.
Postpaid net additions in Q4 totalled 119,520, compared to 143,834 in Q4 2012. The company attributes the 6.7% decrease in postpaid gross activations to increased competition during the holiday period, which also saw the introduction of lower handset discounts and increased rate plan pricing on new two-year contracts following the implementation of the new federal Wireless Code of Conduct.
Smartphone users represented 73% of total postpaid subscribers at the end of 2013, compared to 62% a year earlier. Bell Wireless postpaid customers totalled 6,677,692 at the end of the year, an increase of 3.9%. Total Bell Wireless customers grew 1.3% to 7,778,334.
Higher TV and Internet revenues, driven by a 25% increase in net new Fibe TV subscribers and increased ARPU, helped slow the pace of declining wireline revenue in the fourth quarter.
While operating revenues for Bell wireline decreased by 0.3% in Q4 2013 compared to the same period in 2012, to $2.6 billion, EBITDA grew by 0.3% to $934 million. Dvai Ghose of Canaccord Genuity said that figure exceed his firm’s forecast estimate of $926 million EBITDA for the fourth quarter.
For full-year 2013, wireline operating revenues decreased 1.2% to $10.1 billion, while operating costs were stable compared to last year, resulting in a 3.2% decline in wireline EBITDA to $3.8 billion.
Bell Fibe TV added 60,301 net new customers, compared to 48,234 in Q4 2012. The Bell Fibe TV footprint reached more than 4.3 million households at the end of 2013, compared to approximately 3.3 million at the end of 2012.
BCE’s Bell Media division saw an increase in both operating revenue (38.9%) to $821 million and EBITDA ($33.7%) at $230 million in Q4. The increases reflect higher advertising and subscriber fee revenues from the Astral acquisition, which closed on July 5, 2013, as well as planned market-based step-ups in specialty TV rates paid by broadcast distributors for Bell Media content and programming.
For the full year 2013, operating revenue and EBITDA were up 17.1% and 21.7%, respectively, to $2.56 billion and $683 million.
In its 2014 guidance, BCE is expecting revenue growth in 2014 of about 2% to 4%; Bell Canada EBITDA growth between 3% to 5%; and adjusted earnings per share to be $3.10 to $3.20, up from $2.99 in 2012.
