MONTREAL – BCE saw an uptick in revenue as higher additions in its postpaid wireless business offset a rise in expenses, the company said Thursday
For the quarter ended December 31, BCE saw operating revenue increase 4.5% to $5.96 billion, led by strong top-line growth at Bell Wireless and Bell Wireline and a favourable financial contribution from the acquisition of MTS that drove 5.1% higher service revenue. This was partly offset by a year-over-year revenue decline at Bell Media due to a soft television advertising market.
Net earnings fell 11.7% to $617 million while net earnings attributable to common shareholders dropped 12.5% to $575 million. Despite higher adjusted EBITDA, the company said that net earnings declined due to increased depreciation and amortization expense, higher severance, acquisition and other costs, increased interest expense, and higher other expenses attributable to $82 million in non-cash asset impairment charges related to Bell Media specialty music TV channels and certain radio properties.
Excluding severance, acquisition and other costs, net losses on investments, impairment charges and early debt redemption costs, adjusted net earnings were up 2.5% to $684 million from strong year-over-year growth in adjusted EBITDA.
BCE’s adjusted EBITDA grew 4.5% in Q4 to $2.22 billion, driven by increases of 9.2% at Bell Wireless and 4.1% at Bell Wireline, and supported by the financial contribution of Bell MTS. Bell Media adjusted EBITDA declined 9.0% due to lower advertising revenue and higher content costs compared to the previous year.
The Montreal-based telco gained 175,204 net wireless postpaid customers, lost 16,690 net wireless prepaid subscribers; gained 27,040 net high-speed Internet customers; gained 32,484 net IPTV customers, and lost 25,938 net satellite TV customers. Residential and business NAS line net losses totalled 74,070.
At the end of 2017, BCE said that customer connections across all services totalled 22,109,711, up 5.5% from last year. The total comprises 9,166,787 wireless customers, up 8.2% over last year (including 8,418,650 postpaid customers, an increase of 9.5%); total high-speed Internet subscribers of 3,790,141, up 9.0%; total TV subscribers of 2,832,300, up 3.2% (including 1,550,317 IPTV customers, an increase of 15.9%); and total NAS lines of 6,320,483, an increase of 1.0%.
"Executing our strategy of broadband investment and innovation leadership, the Bell team welcomed more than 1.26 million new broadband wireless, TV and Internet customers in 2017, and 235,000 in an outstanding fourth quarter, to lead the Canadian communications industry”, said president and CEO of BCE and Bell Canada George Cope, in a statement. “With 175,000 net new postpaid wireless customers in Q4 – a 56% increase and our best performance in 15 years – and rising customer satisfaction, it's clear that customers are choosing Canada's Best National Network in a highly competitive mobile marketplace.”
For 2018, BCE said that it is projecting revenue growth in the range of 2% – 4%, and adjusted EBITDA growth of 2% – 4%.
With Bell's all-fibre Toronto network nearing completion, the company also announced the expansion of direct fibre to the premises (FTTP) connections throughout the populous and fast-growing Greater Toronto Area and 905 region. Bell's fibre plan will deliver Gigabit Internet speeds and other broadband Fibe service innovations directly to more than 1.3 million homes and businesses in the region.
The full details of BCE’s Q4 2017 financial results are available here.
