Bell says it will spend an extra $1B on networks

BCE Inc. announced Thursday morning that it would increase its typical capital expenditure by between $1 billion and $1.2 billion over the next two years, as the money will go to Bell's build-out of broadband fibre and wireless networks. Speaking to financial analysts on the company's fourth quarter earnings call Thursday morning, Bell CEO Mirko Bibic said that the company will spend some $700 million in 2021, adding that the initiative would be funded by the sale of the company's data centers, and is in addition to Bell's usual annual capital expenditure of roughly $4 billion. Bibic added that a "stable regulatory environment" had created the conditions for the capital expenditure increase. "Now isn't the time for policy makers and regulators to move away from encouraging network investments," Bibic told analysts. The announcement comes after Bell's media division laid-off several hundred journalists in Montreal and Toronto over the last two weeks, first reported by Cartt.ca. While Bell executives did not address the layoffs -- which won't be reflected until the first quarter of 2021 -- Bibic said that advertiser demand in the media division had increased in the fourth quarter with the return of fall sports, and television advertising revenue was only down two per cent from last year, which predated the pandemic. Bell's chief financial officer Glen LeBlanc told analysts he expects "all of our business units to provide positive contributions to both revenue and EBITDA in 2021," adding that he expects advertising revenue to come back as live sports continue to return. In a statement emailed to The Wire Report on Tuesday, a Bell spokesperson declined to specify how many employees the company laid off, but said that "there are further changes in roles, including some departures, reflecting Bell Media’s streamlined operating structure." "As the media industry evolves, we’re focused on investment in new content and technology opportunities while also ensuring our company is as agile, efficient and easy to work with as possible," the spokesperson wrote. Bell's overall revenue dropped 2.8 per cent from the fourth quarter of 2019, down to $6.1 billion from $6.28 billion, which the company said was due to the impacts of COVID-19 on wireless product sales, roaming revenue, and advertising demand. The company's profits climbed 28.9 per cent up to $932 million from $723 million this time last year, which Bell attributed primarily to the sale of the company's data centres to the California-based Equinix Inc., first announced in June and finalized in the fourth quarter. The company added 92,928 postpaid wireless subscribers, a 23.6 per cent drop from the 121,599 the company added in the same quarter of 2019. The company lost 11,672 prepaid wireless subscribers, while it has gained 1,983 prepaid wireless subscribers this time last year. The company posted a total of 10.22 million wireless subscribers at year's end, a 2.6 per cent gain from the 9.96 million the company posted for 2019. Bell's wireless average billing per user (ABPU) dropped 3.9 per cent to $64.71 from $67.35 at the end of 2019. In wireline, the company added 44,512 internet subscribers, a 24.9 per cent increase from 35,639 they added in the fourth quarter of 2019, for a total of 3.7 million internet subscribers. The company also added 536 television subscribers, just up from the 421 they added this time last year. The number reflects the addition of 21,106 IPTV subscribers and the loss of 20,570 satellite subscribers. Bell now posts a total of 2.74 million television subscribers, down 1.2 per cent from the 2.77 million the company posted last year. Wireless revenue dropped 1.9 per cent to $2.41 billion, down from $2.45 billion this time last year. Wireline revenues dropped 1.3 per cent to $3.1 billion, down from $3.14 billion a year ago. Revenues in the media division were down 10 per cent from the fourth quarter of 2019, to $791 million from $879 million. — Reporting by Michael Lee-Murphy at mleemurphy@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Bell says it will spend an extra $1B on networks

News | February 4, 2021

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Bell says it will spend an extra $1B on networks

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