Bell Canada Enterprises Announces Significant Increase In Profit

Bell Canada Enterprises tops estimates on new wireless customers, ups dividend by 5.3% to $2.60

Bell Canada Enterprises BCE Inc. (TSE:BCE, Mkt cap 45.83B, P/E 18.64, Div/yield 0.62/4.46, EPS 2.97, Shares 840.33M) appears to be taking market share from its cable-TV competitors, posting a near 10% increase in fourth-quarter profit last week, the Financial Post reports.

Canada's largest telecommunications company showed strong wireline subscriber and revenue gains, which analysts say shows that the firm is becoming a bigger player in the cable-TV market.

Bell Canada, which also hiked its annual dividend by 5% to $2.60, added 177,698 net new customers in the fourth quarter – 42,190 of which were television subscribers.

The Montreal-based company, which operates under the Bell brand, also posted healthy gains in wireless results, and its Internet-TV service enjoyed a significant and somewhat surprising increase in uptake.

Wireline revenue climbed 1% to $2.63 billion, the first year-over-year growth since the third quarter of 2010, Canaccord Genuity analyst Dvai Ghose pointed out.

In wireless, Bell Canada acquired 118,120 postpaid customers, while losing 34,622 prepaid customers, which the telco's chief financial officer Siim Vanaselja says shows that it is moving in the right direction.

"Our financial targets for this year reflect our expectation for continued strong wireless segment profitability, positive growth in wireline segment performance, as well as healthy earnings and free cash flow growth from operations," he said.

Fourth quarter net income rose to $542 million from $495 million in the year-earlier period. On a per-share basis, net earnings were flat at 64 Canadian cents.

In the next 12 months, Bell Canada forecasts revenue growth of around 1% to 3% and adjusted earnings per share of $3.28 to $3.38, which represents a rise from $3.18 in 2014.

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Stockwatch – BCE Makes Move to Buy Glentel

Stockwatch – During the second quarter of 2014 BCE’s revenue grew by 4.4%, to $5.2 billion.

Stockwatch – BCE Inc. (TSE:BCE, Mkt cap 43.94B, P/E 17.61, Div/yield 0.62/4.72, EPS 2.97, Shares 839.60M) has signed an agreement to buy wireless phone retailer Glentel Inc. in a deal valued at $670 million in stock, cash and debt, which analysts say further extends the telecoms giant’s reach into the wireless market.

The wireless segment has played a pivotal role in BCE’s growth in recent years, and the acquisition of Glentel is key to its strategy to accelerate the technology further.

Stockwatch BCE Glentel Wirelesswave T-Booth

Stockwatch – BCE to buy Glentel. The retailer owns the Wirelesswave and T-Booth brands.

Burnaby, B.C.-based Glentel has nearly 500 retail locations across Canada, offering customers wireless products and services from a variety of carriers including Bell Mobility, Rogers Wireless, Chatr, Fido, SaskTel and Virgin Mobile.

The company has a considerable presence outside of Canada, too, with 735 stores in the United States and a further 147 in Australia and the Philippines.

BCE highlighted that it has spent almost $7 billion in under a decade to acquire new wireless spectrum and build the high-speed wireless networks to utilize those airwaves.

As part of the deal, BCE will take on net debt and minority interest of approximately $78 million. The cash and stock transaction is expected to close by the end of the first quarter of next year.

Glentel CEO Tom Skidmore said he is delighted that Glentel, together with Bell, will continue to deliver “legendary” customer service, adding that the new relationship will not only provide additional value to its shareholders, but its employees, too.

The Skidmore family, which has a stake of approximately 37% in Glentel, has signed agreements with Bell supporting the sale.

Glentel shareholders can choose to receive either $26.50 in cash or 0.4974 of a BCE share for each Glentel share they hold.

Stockwatch – During the second quarter of 2014 BCE’s revenue grew by 4.4%, to $5.2 billion from $5.0 billion, as a result of strong demand for the company’s wireless and Fibe TV services. BCE faces a number of regulatory challenges, however it is doing a good job of improving its services and keeping its operating costs down. That will likely allow the company to maintain its high dividend yield.

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Bell Canada – Media, Wireless Units Help BCE Boost Q4 Results

Bell Canada subsidiary of BCE Inc., registered a 1.3% uptick in wireless subscriber numbers and a 7.7% rise in its TV subscribers count

Bell Canada, formally known as BCE Inc. (TSE:BCE, market cap 36.35B, P/E 16.94, Div/yield 0.62/5.27, EPS 2.77, Shares outstanding 775.89M), has reported a 16.4% increase in adjusted earnings for the quarter to December and raised its dividend by 6%, citing a positive business outlook for 2014 underpinned by strong results from its media and wireless operations.

Bell Canada wireless subscriber numbers. Average revenue rose 2.1%.

Bell Canada registered a 1.3% uptick in wireless subscriber numbers. Average revenue per user rose 2.1%.

The company’s adjusted net quarterly earnings hit C$540 million, or C$0.70 adjusted earnings per share, up from C$0.60 a year earlier. On a non-adjusted basis BCE’s earnings slipped to C$495 million, or C$0.64 per share, from C$666 million, or C$0.86, in October-December 2012, due to the absence of a gain related to the transfer of spectrum.

BCE generated revenues of C$5.38 billion in the quarter, up from C$5.16 billion a year earlier. The figure was below analysts’ projections for revenues of C$5.41 billion.

Bell Canada, the wholly owned subsidiary of BCE Inc., registered a 1.3% uptick in wireless subscriber numbers and a 7.7% rise in its TV subscribers count. Its high-speed Internet subscriber base expanded by 3%, but the number of its landline customers bucked the trend, dropping by 6.6%.

73% of Bell’s long-term contracts subscribers now use smartphones. That’s up from 62% last year. Smartphones generate higher fees for Bell than regular cellphones. Average revenue per user rose 2.1%.

BCE’s quarterly figures were solid overall, with the size of the dividend increase and the relative strength of its landline operations being the two components that outstripped analysts’ projections.

The company will distribute a quarterly dividend of C$0.6175 per share. The higher amount reflects the expected increase in free cash flow and the brighter outlook for 2014.

BCE anticipates adjusted earnings in the range of C$3.10 to C$3.20 per share for 2014, in line with analysts’ forecasts. The company expects to see free cash flow improve by between 3% and 7% this year.

At current valuation levels, investors appear to have built in much of the anticipated growth in the near term outlook for the company.

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