BCE (Bell Canada Enterprises) reported revenues of $4.7 billion, an increase of 2.2% over the same period last year. The company took an $88 million charge in the quarter related to employee reductions, real estate consolidation and other items, which resulted in operating income for the quarter of $907 million as compared to $1,043 million in the first quarter of 2005.
"BCE's performance in the first quarter is on track against the two-year plan we laid out on February 1 to reposition Bell Canada by ramping up our growth services, expanding bandwidth, making service a market differentiator and lowering costs," said Michael Sabia, President and Chief Executive Officer of BCE.
Some highlights for the quarter:
- Revenues from wireless, video and Internet generated 47% of Bell's total revenues in the quarter, compared to 42% one year earlier. Each of these services recorded year-over- year double-digit revenue increases and are on track to reach approximately 55% of total Bell revenues by year-end.
- In High Speed Internet there were 71,000 net additions, giving the company 2,266,000 subscribers. The company noted aggressive competition, particularly in the Quebec market.
- Bell's Fibre-to-the-node (FTTN) roll-out was extended to 279 neighbourhood nodes in the first quarter, for a total of 2,327.
- Bell launched Sympatico High Speed Unplugged, which leverages the Inukshuk joint-venture to provide users with portable Internet access. The company also expanded its next-generation EVDO wireless data network footprint to new communities across Canada.
- Residential segment revenue growth in the quarter of 0.7% year over year to $1,869 million, compared to $1,856 million in the same period last year.
- Business segment revenue grew in the quarter of 2.1% year over year to $1,509 million, compared to $1,478 million in the same period last year
- The Enterprise segment continued to face aggressive competitive pressure in the market, resulting in the loss of high-margin voice and data business. In addition, higher pension costs and amortization expense contributed to lower Business segment operating income; $205 million for the first quarter of 2006, down 14.6% from the same period last year.
- Wireless continues to strengthen as gross additions increased 17% year over year, leading to the continued improvement in the quality of the customer base - strengthening ARPU and contributing to double-digit revenue growth. Revenue grew 12.8% to $804 million in the first quarter compared to $713 million in the first quarter of 2005. There were 59,000 net activations in the quarter.
- Bell's video group remains Canada's leading Direct-to-Home (DTH) provider. Total subscribers were up 13.5% year over year to reach 1,739,000 at the end of the first quarter. Churn remains low at 0.9% per month.
