MONTREAL – Bell Canada Enterprises continued the run of good news for Canada’s communications companies, adding thousands of broadband, TV and wireless customers in the first quarter of 2018, ended March 31.
"Network leadership continues to drive Bell's progress in broadband customer additions, service usage and revenue growth as we welcomed approximately 102,000 net new postpaid wireless, Internet and IPTV customers in the first quarter of 2018,” said CEO George Cope in the company’s press release this morning. This was the company’s best first quarter since 2011, he added.
“I fully expect the strong subscriber growth to continue this year,” he later said to financial analysts during a conference call.
“We are proud to hold our annual general meeting of shareholders in Toronto today, where Bell recently turned on our unparalleled pure fibre network and announced our next major rollout to centres throughout the fast-growing GTA/905 region, adding to the increasing number of cities and almost four million Canadians across seven provinces benefitting from Bell's all-fibre broadband network,” he added.
BCE operating revenue was up 4.8% in Q1 to $5.6 billion. Service revenue grew 3.2% to $4.96 billion, and product revenue increased 19.2% to $626 million. “This reflects increases at both Bell Wireless and Bell Wireline, including favourable financial contributions from Bell MTS, partly offset by a modest year-over-year revenue decline at Bell Media,” said the company’s release.
The Media division will remain under pressure as advertising has continued its slide while content costs remain high. “EBITDA was down, declining 3%, was mainly due to the higher cost of sports broadcast rights and the CraveTV content expansion,” added BCE CFO Glen LeBlanc during the company’s conference call with financial analysts. “We expect that content cost pressures and ongoing TV advertising market challenges will continue to weigh on Bell Media’s EBITDA performance for the balance of the year.”
BCE’s adjusted EBITDA grew 4.1% to $2.25 billion on increases of 6.9% at Bell Wireless and 3.1% at Bell Wireline, which included an incremental contribution from the MTS acquisition during the quarter, adds the release.
Consistent with higher planned spending in 2018 on BCE's broadband wireline and wireless network infrastructure, total consolidated capital expenditures increased 9.3% to $931 million in Q1 from $852 million last year. This represented a capital intensity ratio of 16.7% compared to 16% in Q1 2017. The increase was due to continued expansion of broadband fibre and mobile LTE, including the deployment of wireless small-cells to optimize mobile coverage, signal quality and data backhaul, and ongoing investment in Manitoba to improve broadband network coverage, capacity and speeds.
The company reported 68,487 net new wireless postpaid subscribers and a decrease of 24,110 net wireless prepaid customers; 19,647 net new high-speed Internet customers; 13,573 net new IPTV customers and a decrease of 26,054 net satellite TV customers (which showed a slower decline). Residential NAS line net losses totaled 57,533.
Also, at the beginning of Q1 2018, the high-speed Internet, IPTV and NAS subscriber bases were increased by 19,835, 14,599 and 23,441, respectively, mainly to reflect the acquisition of a small telecom provider in the quarter, says the release. It wasn’t highly publicized, nor was the company named in today’s release, but in January Bell acquired independent operator Groupe Maskatel, which services Quebec communities Saint-Hyacinthe, Drummondville and their surrounding regions.
For the full BCE Q1 release, please click here.
