Wireless gains help lift BCE earnings
TORONTO (Reuters) - BCE Inc, Canada's biggest telecom company, reported a higher fourth-quarter profit on Wednesday amid gains at its wireless business, as it prepares to be taken private in a C$34.8 billion buyout.
Net earnings were C$2.35 billion ($2.35 billion), or C$2.93 per share, up from C$699 million, or 84 Canadian cents a share, lifted by gains from the sale of its Telesat satellite subsidiary and lower interest and income tax expenses.
Before restructuring and other items, BCE earned C$577 million, or 72 Canadian cents a share, up from C$353 million, or 44 Canadian cents a share, a year earlier.
National Bank Financial analyst Greg MacDonald wrote in a note to clients that the company's net wireless subscriber additions, at 195,000 during the quarter, were slightly better than his estimate of 184,000.
He also noted that average revenue per user rose 3.8 percent and was higher than expected, "signaling that the company is not relying on pre-paid growth to make their numbers."
Operating revenue for the quarter was C$4.55 billion, up from C$4.53 billion for the same quarter a year earlier.
BCE, parent of Bell Canada, is being bought by a group of private-equity firms that includes the Ontario Teachers' Pension Plan, Providence Equity Partners, Madison Dearborn Partners and Merrill Lynch Global Private Equity.
The buyers have offered C$42.75 a share for BCE, but the stock is currently well below that, as investors weigh the possibility that the buyout may be delayed, repriced or abandoned altogether. The shares were up 93 Canadian cents at C$35.48 on the Toronto Stock Exchange on Wednesday morning.
BCE, which is also being sued by bondholders who say the takeover hurts them in its present form, said it currently expects the deal to close early in the second quarter of 2008. Continued...