BCE (TSX:BCE), owner of Canadian telecom giant Bell and broadcaster CTV, Thursday posted third quarter earning slightly below expectations as it said it was on track to meet its full-year earnings targets.
For the three months ended September 30, net income dropped to $569 million and adjusted net earnings fell to $588 million, or 76 cents per share. Adjusted EPS was a penny below recent analyst estimates compiled by Thomson Reuters.
Revenue was up slightly from last year at $4.98 billion compared with $4.91 billion in the third quarter of last year.
Analysts had estimated BCE’s adjusted earnings would be 77 cents per share on revenue of $4.9 billion, according to estimates Thomson Reuters.
“Bell is making unparalleled investments in the best new networks, products and content, and we’re seeing the results in strong growth across our wireless, TV, Internet and media businesses,” BCE and Bell Canada president and CEO George Cope said.
BCE’s chief financial officer Siim Vanaselja added: “We performed well across the business in Q3, posting another sound quarter of EBITDA growth and margin expansion, driven by exceptional wireless and media results as well as substantial net earnings and free cash flow consistent with our plan.
“Our 2012 financial plan remains on track as we reconfirm today all our Bell and BCE guidance targets for the year.”
BCE said it was on track to meet financial guidance issued in August, before the company’s attempt to buy Astral Media (TSE:ACM.A) was blocked by Canada’s media and telecoms regulator, the CRTC.
Bell has extended the deadline for its takeover offer for Astral Media to December 16 in order to win regulatory approval. The deadline can be extended further to January 15. Bell also has asked the government to direct the CRTC to follow its own policies but Industry Minister Christian Paradis has said the government has no plans to intervene.
The company had seen strong growth across its wireless, TV, Internet and media businesses. Bell Fibe TV added 42,973 net new subscribers, up from 20,297 in the third quarter of 2011. At the end of the quarter, Bell Fibe TV had 200,000 subscribers.
Bell added 148,502 net postpaid mobile phone subscribers, 17.1 per cent more than in the same quarter last year. Postpaid customers, who often sign multi-year contracts, typically pay more each month than prepaid subscribers.
The company has raised the proportion of its postpaid customers using smartphones, to 60 per cent at the end of the quarter from 43 per cent a year earlier.
Smartphone growth helped boost revenue as BCE’s wireless customers paid an average of $57.30 each month, up from $55.01 a year earlier.
Bell Media, BCE’s broadcasting arm, delivered strong financial and operational performance in the third quarter with higher subscriber fee revenues as well as higher revenues from broadcasting the 2012 London Games.