-- Year-over-year financial trends continue to improve from prior
-- IPTV customer base exceeds 100,000
-- Total data revenues grow $21 million, up 9.6 per cent
o IPTV revenues up $10 million
o Internet revenues up $10 million
-- Net NAS declines improve 14 per cent over prior year
This news release contains forward-looking statements. For a description of
the related risk factors and assumptions, please see the section entitled
"Forward-looking information" later in this release.
HALIFAX, Oct. 30, 2012 /CNW/ - Bell Aliant Inc. (TSX: BA) today reported
financial results for the third quarter of 2012 for Bell Aliant Inc. (Bell
Aliant) and Bell Aliant Regional Communications Inc. (Bell Aliant GP).
"We had another productive quarter in Q3 as we further expanded our
fibre-to-the-home (FTTH) coverage area and had our best quarter yet for new
FibreOP(TM) customer additions," said Karen Sheriff, president and chief
executive officer, Bell Aliant. "I am very pleased that more and more
customers are coming on board and experiencing our great FibreOP TV and
"We now have over 100,000 IPTV customers and IPTV was our largest area of
revenue growth in the quarter. We also had strong Internet revenue growth and
our NAS declines again were better than the same quarter last year, following
the trends we have experienced in prior quarters of 2012.
"We have been adding more FibreOP customers with each passing quarter, and
with more than half of the homes in Atlantic Canada now having access to these
services, we are beginning to have sufficient FibreOP scale to make a
difference in our overall results. This kind of steady progress is what we
envisioned when we launched our FTTH rollout in 2009. While we expect 650,000
premises to have access to our FibreOP services by the end of this year, we
will still have more to do. I expect to announce our plan for further
expansion in early 2013."
Third quarter 2012 highlights(1)
Bell Aliant Inc. reported net earnings of $92 million for the third quarter of
2012, up $16 million (21.6 per cent) compared to the same quarter of 2011.
Earnings per share and adjusted earnings per share in the quarter were $0.40
and $0.47 respectively, compared to $0.33 and $0.41 in the same quarter of
2011. The earnings increase was primarily attributable to lower restructuring
charges in the third quarter of 2012 compared to the same quarter of 2011.
Third quarter financial highlights of Bell Aliant GP are summarized as follows:
|(In millions of | | | | | | |
|dollars) |Q3 2012|Q3 2011|Change |YTD 2012|YTD 2011*|Change|
|(unaudited) | | | | | | |
|Operating Revenue| $697 | $700 |(0.4%) | $2,067 | $2,074 |(0.4%)|
|EBITDA | 335 | 340 |(1.5%) | 990 | 1,003 |(1.2%)|
|Capital | | | | | | |
|Expenditures | 144 | 162 |(11.0%)| 458 | 436 | 5.1% |
|Free Cash Flow* | 113 | 110 | 3.1% | 358 | 389 |(7.8%)|
* Year to date 2011 free cash flow excludes a $200 million lump sum
contribution to defined benefit plans made in Q1 2011.
Operating revenues in the third quarter of 2012 were $697 million, down $3
million (0.4 per cent) from the same quarter in 2011. Growth in data revenues,
including Internet and TV, wireless and other revenues largely offset declines
in local and long distance revenues. Operating expenses in the third quarter
of 2012 were up $2 million from the same quarter in 2011, reflecting growth in
TV content costs from higher FibreOP TV customers and other costs of revenues,
which were largely offset by productivity savings. As a result, EBITDA
declined $5 million (1.5 per cent) in the third quarter of 2012 compared to
the same quarter in 2011.
Capital expenditures in the third quarter of 2012 were $144 million, down $18
million (11.0 per cent) from the same quarter a year earlier, mainly due to
lower FTTH footprint expansion in the third quarter of 2012 compared to the
same quarter in 2011. In the third quarter of 2012, Bell Aliant passed an
additional 47,000 homes and businesses with FTTH compared to 104,000
incremental premises in the third quarter of 2011. Total FTTH coverage reached
621,000 premises at the end of September 2012 and Bell Aliant continues to
expect to reach 650,000 premises with FTTH by the end of the year.
Free cash flow was $113 million in the third quarter of 2012, up $3 million
from the same quarter a year earlier. The increase was primarily a result of
lower capital expenditures offset by lower EBITDA and lower cash from changes
in working capital in the third quarter of 2012 compared to the third quarter
Total data revenue including Internet and TV increased $21 million (9.6 per
cent) in the third quarter of 2012 compared to the same period in 2011.
Internet revenue increased $10 million (7.9 per cent) with residential
high-speed average revenue per customer (ARPC) in the third quarter of 2012 up
7.1 per cent from the same quarter a year earlier. Selected pricing action,
lower promotional discount effects and customer movement to premium services,
including FibreOP, drove the increase. FibreOP Internet customers grew by
16,500, bringing total FibreOP Internet customers to 92,000 at the end of
September 2012. FibreOP Internet additions include existing Bell Aliant
customers migrating from DSL and fibre-to-the-node (FTTN) networks to the
upgraded service. These migrations do not contribute to overall high-speed
customer growth, but increasingly contribute to improved customer retention
and growth in overall customer ARPC. Overall net high-speed Internet customer
additions were 7,500 in the third quarter of 2012, bringing total high-speed
Internet customers to 913,600 at the end of September 2012, up 2.4 per cent
from a year earlier.
IPTV revenue grew $10 million in the third quarter of 2012 compared to the
third quarter of 2011 with total IPTV customers of 107,400 at the end of
September 2012. FibreOP TV customers grew by 14,200 in the quarter to reach
79,500, a portion of which were migrations from Bell Aliant's FTTN TV service.
Overall net IPTV customer additions were 12,300 in the third quarter of 2012,
compared to 9,000 a year earlier.
Other data revenue grew $2 million (1.7 per cent) in the third quarter of 2012
from the same quarter a year earlier, continuing the improved trends of recent
quarters as a result of data demand growth.
Local service and long distance revenues declined $16 million (5.0 per cent)
and $12 million (12.0 per cent), respectively, in the third quarter of 2012
compared to the same quarter in 2011, driven by NAS declines of 5.1 per cent.
Net NAS declines of 32,400 in the third quarter of 2012 improved 14 per cent
from the same quarter in 2011 with improved residential customer activations,
winbacks and retention in FibreOP markets.
Wireless revenues were up $3 million (9.7 per cent) in the third quarter of
2012 compared to the same quarter in 2011, driven by 6.8 per cent customer
growth and 2.5 per cent wireless ARPC growth compared to a year ago. Other
revenues also increased $1 million (2.3 per cent) in the third quarter
compared to a year ago, driven largely by higher product sales.
Bell Aliant's Board of Directors today declared a quarterly dividend of
$0.4750 per common share, payable on December 31, 2012 to shareholders of
record at the close of business on December 14, 2012.
Bell Aliant Preferred Equity Inc. today declared a dividend on its Series A
Preferred Shares of $0.303125 per share and a dividend on its Series C
Preferred Shares of $0.284375 per share to be paid on December 31, 2012 to
shareholders of record at the close of business on December 14, 2012.
Unless otherwise stated, dividends paid by Bell Aliant and Bell Aliant
Preferred Equity Inc. to Canadian residents are "eligible dividends" as
defined by the Canadian Income Tax Act and corresponding provincial
More information on Bell Aliant's and Bell Aliant GP's third quarter 2012
results can be found in Bell Aliant's third quarter 2012 supplementary
financial information package and MD&A and Bell Aliant GP's third quarter 2012
MD&A available at www.bellaliant.ca/investors .
Analyst conference call
A conference call with the financial community is scheduled for October 30,
2012 at noon (EDT). The dial-in numbers are 866-226-1792 and 416-340-2216 for
Toronto area participants. Media are invited to attend in listen-only mode. A
replay of the session can be heard until November 27, 2012. To access the
replay, dial 800-408-3053 or 905-694-9451 and enter the passcode 3266319.
A live audio webcast of the conference call can be accessed at
www.bellaliant.ca/investors . A replay of the conference call will be
available on the website for one year.
(1)See Notes section at the end of this release for definitions of the
non-International Financial Reporting Standard (IFRS) financial measures
including EBITDA, free cash flow and adjusted earnings per share.
The information contained in this news release is unaudited.
(1) Bell Aliant derives virtually all of its income from its ownership in Bell
Aliant GP. Bell Aliant GP's results consolidate the results of Bell Aliant
Regional Communications, Limited Partnership; Télébec, Limited Partnership;
NorthernTel, Limited Partnership; and Bell Aliant Preferred Equity Inc.
(2) Percentage changes quoted in this release related to dollar values are
based on amounts rounded to the nearest hundred-thousand, consistent with
disclosure in Bell Aliant's supplementary financial information package and
Bell Aliant Inc.'s and Bell Aliant GP's MD&As for the third quarter of 2012.
Dollar values quoted in this release are rounded to the nearest million unless
otherwise stated. Customer metrics are rounded to the nearest hundred unless
(3) Definitions of non-IFRS measures:
a. EBITDA: Bell Aliant defines EBITDA as operating revenue less operating
expenses (operating income) before interest, income taxes, depreciation and
amortization expense, severance and other charges.
b. Free cash flow: Bell Aliant defines free cash flow as cash generated from
operating activities less capital expenditures. Free cash flow includes the
operations of Bell Aliant and Bell Aliant GP on a combined basis.
c. Adjusted earnings per share: Bell Aliant defines adjusted earnings per
share as fully diluted earnings per share adjusted for the per share effect of
purchase price allocation amortization, net of income taxes.
For a reconciliation of these non-IFRS measures to the most closely comparable
IFRS measures, please refer to Bell Aliant GP's MD&A for the third quarter of
2012 available at www.bellaliant.ca/investors and www.sedar.com .
This news release contains forward-looking statements concerning anticipated
future events, results, circumstances or expectations, in particular
statements concerning FTTH expansion plans. Unless otherwise indicated, such
forward-looking statements describe management's expectations at October 30,
2012. These statements are based on management's beliefs regarding future
events, many of which, by their nature, are inherently uncertain and beyond
management's control. These statements are not guarantees of future
performance and are subject to assumptions which may prove to be inaccurate
and numerous risks and uncertainties which are difficult to predict.
Bell Aliant encourages investors to review the risk factors section below, and
related disclosures, for a discussion of the various factors that could cause
actual results to differ from what is currently expected.
There are many factors that could cause results or events to differ materially
from current expectations. The most significant factors that Bell Aliant has
identified that may affect Bell Aliant's results or events in 2012 include but
are not limited to: increasing competition; management's ability to achieve
strategies and plans, including expansion of its FTTH network and managing the
cost structure; general economic conditions; pension valuation and investment
risk; reliance on systems; changing technology; demand for products and
services; the business relationship with BCE Inc. (BCE) and Bell Canada;
changing regulations; dependence on key suppliers; maintenance of credit
ratings; leverage and restrictive covenants; BCE's governance rights; reliance
on key personnel and labour relations; legal contingencies and changes in
laws; and tax-related risks. Some of these risk factors are largely beyond
Bell Aliant's control. For additional information on material factors and
assumptions used to develop forward-looking information, and risk factors that
could cause actual results to differ materially from forward-looking
information, see also the "Risks that could affect our business and results"
section of Bell Aliant Inc.'s MD&A for the year ended December 31, 2011, and
the "Assumptions made in the preparation of forward-looking information" and
"Risks that could affect our business and results" sections of Bell Aliant
GP's MD&A for the year ended December 31, 2011, as updated by the first,
second and third quarter 2012 MD&As, as well as the "Risk Factors" sections of
Bell Aliant Inc.'s and Bell Aliant GP's 2011 Annual Information Forms. These
documents are available at www.bellaliant.ca and www.sedar.com .
Should any risk factor affect Bell Aliant in an unexpected manner, or should
assumptions underlying the forward-looking statements prove incorrect, the
actual results or events may differ materially from the results or events
predicted. Unless otherwise indicated, forward-looking information does not
take into account the effect that transactions or non-recurring or other
special items, announced or occurring after this information is provided, may
have on the business. All forward-looking information reflected in this news
release and the documents referred to within it are qualified by these
cautionary statements. There can be no assurance that the results or
developments anticipated by Bell Aliant will be realized or, even if
substantially realized, that they will have the expected consequences for Bell
Except as may be required by Canadian securities laws, Bell Aliant disclaims
any intention and assumes no obligation to update or revise any
forward-looking information, even if new information becomes available, as a
result of future events or for any other reason. Readers should not place
undue reliance on any forward-looking information. Forward-looking information
is provided for the purpose of providing information about management's
current expectations and plans relating to fiscal 2012 or other future
periods. Readers are cautioned that such information may not be appropriate
for other purposes.
About Bell Aliant
Bell Aliant (TSX: BA) is one of North America's largest regional
communications providers and the first company in Canada to cover an entire
city with FTTH technology with its FibreOP services. Through its operating
entities, it serves customers in six Canadian provinces with innovative
information, communication and technology services including voice, data,
Internet, video and value-added business solutions. Bell Aliant's employees
deliver the highest quality customer service, choice and convenience.
Media Relations: Sarah Levy MacLeod 855-487-5026 email@example.com
Investor Relations: Zeda Redden 877-487-5726 firstname.lastname@example.org
SOURCE: BELL ALIANT INC.
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