Telecommunications and media giant BCE said Wednesday that the acquisition of Astral Media helped push up its first quarter operating revenues and profit.
Amid operating revenue growth of 3.7% to $5.1 billion, the Montreal-based company said that revenue for its Bell Media division grew 40.7% to $722 million, while EBITDA increased 53.1% to $150 million.
The company attributed the increase to higher advertising and revenue fees associated with the Astral purchase, as well as ad rate increases for its specialty TV services and higher revenues generated from new mobile content deals and its suite of TV everywhere products.
BCE said ad revenue growth for the quarter was adversely impacted by a “soft” ad market, while there was also a shift in spending to CBC as a result of its coverage of the Sochi Olympics, said management analysis.
Higher costs for TV programming, combined with increased spending on in-house productions and sports broadcast rights agreements—which the company said continue to increase for the industry as a whole—were absorbed by operating synergies created by the Astral integration.
The company continued to divest assets associated with its purchase of Astral in the quarter, selling six TV services and two radio stations to Corus Entertainment, three radio stations to the Jim Pattison Broadcast Group, and five radio stations to Newcap, bringing in proceeds of $538 million.
The expected sale of five additional Astral Media TV assets to DHX Media and V Media Group is estimated to bring total expected asset divestiture proceeds to more than $720 million.
