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Consolidated EBITDA Margin: Increased 1.2 points to 43.4%, highest annual margin in over 30 years.
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Wireless Service Revenue Growth: Positive growth despite intense pricing competition.
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Internet Revenue Growth: Increased by 3.3%.
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Digital Revenue Growth: Increased by 19%, now 42% of total media revenue.
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Cost Savings: Over $200 million in 2024 from transformation initiatives and workforce reduction.
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CapEx Reduction: Decreased by $684 million to approximately $3.9 billion in 2024.
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Business Solutions Revenue Growth: Increased by 18%.
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Adjusted EBITDA: Up 1.5%, with a 90-point margin improvement to 40.6%.
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Total Revenue: Down 0.8% due to competitive pricing pressures and declines in legacy services.
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CapEx Savings: $66 million in Q4, totaling $684 million for the year.
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Postpaid Net Additions: 56,550, all on the main Bell brand.
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Internet Subscriber Growth: Over 34,000 new net retail subscribers.
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Wireless Service Revenue Decline: Down 1.5%, with expected improvement as ARPU increases.
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Internet Revenue Increase: Up 3.4%.
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Business Solutions Revenue Growth: 14% increase, 6% organic growth excluding acquisitions.
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Bell Media Digital Revenue Growth: Up 6%, driven by Crave DTC streaming growth.
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Crave Subscriber Growth: Increased by 18% to more than 3.6 million subscribers.
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Bell Media EBITDA Growth: 14.2% increase, with a 2.3-point margin increase to 20.3%.
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Free Cash Flow Increase: Projected to increase by 11% to 19% in 2025.
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CapEx for 2025: Budgeted at approximately $3.4 billion, $500 million lower than last year.
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Net Debt Leverage Ratio: Approximately 3.8 times adjusted EBITDA at the end of 2024.
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Total revenue for BCE Inc (NYSE:BCE) was down 0.8%, reflecting competitive pricing pressures and declines in legacy services.
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Postpaid churn increased, and mobile phone ARPU was down 2.7%, indicating challenges in subscriber retention and revenue per user.
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The company faced regulatory challenges, with the CRTC's decision impacting fiber build-out plans, leading to a reduction in CapEx for 2025.
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BCE Inc (NYSE:BCE) has an elevated dividend payout ratio outside its policy range, reflecting financial pressures and potential future adjustments.
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The company anticipates a year-over-year decline in adjusted EPS by 8% to 13% due to higher interest expenses, depreciation, and amortization.
Q: Can you elaborate on the US fiber footprint expansion and the potential involvement of third-party capital? Also, does the non-core asset sale include Bell Media? Lastly, could the dividend be reassessed before the end of 2025 if conditions change? A: (Mirko Bibic, President & CEO) Regarding non-core assets, Bell Media is not included as it is a key strategic growth vector. For the US fiber build, our priority is closing the Ziply Fiber acquisition, which will drive growth in our core fiber business. We are considering third-party capital to reduce funding requirements, and we've received interest from potential partners. On the dividend, it will be reviewed by the Board considering various factors, including competitive and macroeconomic environments.
Q: What are your leverage targets for the end of 2025 and beyond, and what is the timeline for closing additional non-core asset sales? A: (Curtis Millen, CFO) We are focused on maintaining our investment-grade credit rating and reducing our net leverage ratio. The asset review process has already resulted in divestitures of MLSE and Northwestel, and there are other initiatives underway to strengthen our balance sheet. We will announce details as they become available.
Q: Regarding the revenue growth guidance range of negative 3% to plus 1%, what assumptions are made about macroeconomic and regulatory factors? A: (Curtis Millen, CFO) The macroeconomic impact is uncertain, and regulatory decisions are pending. Revenue growth is dependent on market pricing, which is currently competitive. We have seen some improvements, but sustained pricing increases are necessary for higher revenue growth.
Q: How do you view the potential for partnerships or MVNOs in the US fiber market, given the convergence trends? A: (Mirko Bibic, President & CEO) The US market structure is different, and Ziply Fiber competes mainly with one cable company in its footprint. Despite not having a wireless offering, Ziply Fiber has shown strong growth. We will continue to focus on fiber build-out and evaluate opportunities as they arise.
Q: Can you clarify the $7 billion target for asset sales and whether it includes sale and leaseback transactions? A: (Curtis Millen, CFO) The $7 billion target includes $5.7 billion from MLSE and Northwestel, leaving $1.3 billion from other non-core asset sales. These are not sale and leaseback transactions, and the proceeds will be used to de-leverage and strengthen the balance sheet.
Q: What is the impact of the CRTC decision on your CapEx plans, and could you consider using fixed wireless to reduce CapEx? A: (Mirko Bibic, President & CEO) Our CapEx guidance is set, and the CRTC decision will influence how we allocate capital. We may adjust fiber build plans based on regulatory outcomes. Regarding fixed wireless, we are exploring options to reduce legacy network costs, but regulatory support is needed.
Q: How does the current pricing environment affect your wireless back book, and when do you plan to turn off the DRP program? A: (Curtis Millen, CFO) Our priority is reducing churn and retaining customers. The DRP program is not intended to be long-term, and its discontinuation will depend on balance sheet actions and market conditions.
Q: What are the implications of the CRTC's decision on your fiber investment strategy in Canada? A: (Mirko Bibic, President & CEO) The CRTC's decision impacts our fiber build pace, leading to a slowdown. We will focus on greenfield opportunities with appropriate returns. The decision highlights the need for policies that encourage investment in infrastructure.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
