BCE's first-quarter profit helped by wireless, media drags
By Alastair Sharp
TORONTO (Reuters) - A strong performance from BCE Inc's (BCE.TO: Quote) wireless unit helped Canada's largest telecom company post a modest gain in adjusted profit on Thursday, while its media division paid out for a new streaming service and higher sports content costs.
In its landline business, which accounts for well over half of Montreal-based BCE's revenue, growth in internet and TV services barely offset the steady decline playing out in legacy phone services.
Bell, as the company is known to customers, added 35,373 postpaid wireless customers, who typically spend more than those who pre-pay for service, it said.
By comparison, Rogers Communications Inc (RCIb.TO: Quote) lost 26,000 such customers, it said on April 20. The third of Canada's dominant wireless operators, Telus Corp (T.TO: Quote), is due to report next Thursday.
All Canadian wireless providers face a so-called "double cohort" of expiring customer contracts after three-year terms were essentially banned, but Bell appears to be successfully managing the transition.
"We expect wireless momentum to continue through 2015 and continue to believe the 'double cohort' impact is manageable," RBC Capital Markets analyst Drew McReynolds wrote in a note.
An average wireless customer at Bell spent C$60.83 a month for service, down slightly from the prior quarter.
The boost from mobile services was offset by lagging performance in Bell's media unit, where subscriber revenues slipped from a year ago as its sports channel TSN wound down some regional hockey broadcasts and paid out for some games after losing NHL rights to rival Rogers. Continued...