BCE 2Q Earnings Dented by Higher Expenses

By Robb M. Stewart

BCE Inc.'s second-quarter profit fell almost 40% despite a rise in residential internet and wireless services revenue as the Canadian communications company was squeezed by higher expenses.

BCE recorded a drop in net earnings to 397 million Canadian dollars ($297.4 million), or C$0.37 a share, from C$654 million, or C$0.66 a year earlier.

The result included a C$377 million loss on BCE's share of an obligation to repurchase at fair value the minority interest in one of its joint venture equity investments, as well as higher interest expense, and increased severance, acquisition and other costs related mainly to a workforce cuts.

On an adjusted basis, per-share earnings fell to C$0.79, slightly below the C$0.80 mean estimate of 14 analysts polled by FactSet.

Operating revenue rose 3.5% for the quarter to C$6.07 billion, just ahead of the C$6.05 billion expected by the market.

The company said wireless service revenue grew 4.4%, partly due to it seeing the most second-quarter postpaid net activations in 18 years. It also saw the best second-quarter retail internet net activations since 2007, up 10%, as well as a 38% increase in fiber activations and 7% residential internet revenue growth.

BCE affirmed its financial targets for the year, including revenue growth of between 1% and 5%, and a drop in adjusted earnings per share of 3% to 7%.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

August 03, 2023 07:42 ET (11:42 GMT)

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