BCE reports fourth quarter profits down as earnings, soft outlook weigh on shares

BCE Co., Ltd. BCE-T reported a 13.8% decline in earnings in the fourth quarter. Results were weighed down by higher interest expense and declining market values ​​of French TV assets.

According to the company, adjusted earnings per share in 2023 are expected to decline between 3% and 7% after tax adjustments, higher depreciation and higher interest costs.

BCE shares fell about 2.3% in afternoon trading on the Toronto Stock Exchange on Thursday.

Montreal-based Telecom posted a profit of $567 million for the three months ended December 31, down from $658 million a year ago. Total operating revenue for him was $6.44 billion, up 3.7% from last year.

On a conference call to discuss the company’s fourth-quarter results, Telecom President and Chief Executive Officer Mirko Bibic said aggressive Black Friday campaigns from competitors are on the rise as consumers return to shopping in person. said it was facing a deal offer from

“For the first time since 2019, more retail visits and shopping activities were unrestricted, returning to pre-pandemic levels of competition.

Meanwhile, economic pressures have kept demand for television and radio advertising low across the industry. However, Bibic said BCE’s media division has grown his FIFA World Cup viewership and advertising, and he expects that in 2022, he will grow by 4 minutes and 1 on the company’s streaming platform. Backed by Crave, he said it “exceeded expectations.”

Bibic said the company’s fiber and 5G expansion has opened up new opportunities for bundled offers and upgraded cell plans. The company’s wireless revenue increased by 7.7% in the fourth quarter, while the number of prepaid and postpaid mobile phone customers increased by 122,621, an increase of 11.8% from last year.

A postpaid customer is a customer who is billed at the end of the month for the services they use, and a prepaid customer is a customer who prepays for wireless service.

In 2022, Bell acquired two independent internet providers, EBOX and Distributel, to provide more access to “value-conscious residential and small business customers,” Bibic said.

Roaming charges rose from last year as increased immigration and travel contributed to the company’s profits and Canadians continued to return to international travel.

However, the company said it is mindful of the recession headwinds it may face in 2023, higher borrowing rates, costs to repay debt and increased depreciation associated with continued network building. I’m here.

BCE Chief Financial Officer Glen LeBlanc told analysts the company faces $44 million in inflation pressure in 2022 and $43 million in storm restoration costs in 2022. Year.

Bibick said he is prepared for the potential for increased competition from rival Rogers Communications if Shaw’s proposed acquisition goes forward.

“If someone wants to take us there, we have room to compete on price,” Bibic said.