BCE’s Fourth-Quarter Profit Tops Estimates on Higher Data Sales

BCE Inc. (BCE), Canada’s second-largest wireless carrier, reported fourth-quarter profit that beat analysts’ estimates as the company saw growth from higher data revenue and added postpaid smartphone subscriptions.

Excluding one-time charges and gains, earnings were 70 Canadian cents (63 cents) a share, the Montreal-based company said today in a statement. That compared with the 69 cents projected by analysts on average, according to data compiled by Bloomberg. Sales were C$5.38 billion, missing the average estimate of C$5.41 billion.

BCE, known by its brand name Bell, is fighting to maintain average revenue per customer, an area where it outperforms competitors Telus Corp. and Rogers Communications Inc. An increase in smartphone users is allowing Bell to make more money from each customer, Phillip Huang, a Toronto-based analyst with Barclays Plc, said in a note last week to clients. Huang rates the shares a buy.

“Wireless data revenue increased 15.2 percent on higher customer usage driven by greater adoption of smartphones and increased data consumption,” the company said in the statment.

BCE added 119,520 wireless contract customers last quarter. That compared with an estimate of 123,600, based on a Bloomberg survey of nine analysts. Average revenue per customer was C$57.92, compared with C$57.80, the average estimate of nine analysts surveyed by Bloomberg.

The company’s shares fell 0.3 percent to $45.37 yesterday at the close in Toronto. They rose 7.9 percent last year, compared with an 8.1 percent gain for the S&P/TSX Telecom Services Index.

Government Auction

Bell is participating in a government auction for premium 700-megahertz spectrum that would be used to stream videos and other Web content. The company is likely to get its share of spectrum for close to the starting price of C$162 million for each block because the auction didn’t attract enough bidders to drive up the price, Greg MacDonald, a Toronto-based analyst with Macquarie Group Ltd., said on Jan. 15, the week the auction started.

Rogers and Telus, who join Bell to make the Big Three Canadian phone companies, report their fourth-quarter earnings next week.

To contact the reporter on this story: Gerrit De Vynck in Toronto at gdevynck@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.