BCE says its net income rose 41.4% in the third quarter, aided by the results from recently re-acquired CTV – part of the telecom company’s revived push into the television sector and new forms of media.
“We now generate more revenue from TV than we do from residential voice revenues and, at $454 million, we obviously expect that to continue to grow,” BCE chief executive George Cope told analysts Thursday in a conference call.
However, Cope also sounded a caution about the uncertain outlook for advertising revenues at its media holdings, which include not only the CTV conventional television network but also a range of specialty television channels such as TSN and the former CHUM radio group.
Similar comments have been made recently by the CEOs of Astral Media, Corus Entertainment and Torstar during their quarterly reports.
All have referred to the uncertainty caused by the European debt crisis.
“We, as our other competitors have mentioned, are cautious about the fourth quarter in terms of advertising revenue,” Cope said Thursday.
“Our guidance remains the same for the company, but clearly that’s one area we’re watching carefully given some of the events on a global basis.”
The Montreal-based telecommunications company reported earnings of $642 million, or 83 cents per share, up from $454 million, or 81 cents per share a year ago.
On an adjusted basis, BCE’s earnings rose 14.8% to 93 cents per share, beating average analyst expectations of 74 cents, according to a poll by Thomson Reuters.
Revenues increased 8.7% to $4.91 billion from $4.52 billion.
At Bell Canada, the company’s main subsidiary, operating revenues grew 10.1 per cent to $4.31 billion as the results from the purchase of CTV energized results in the company’s new Bell Media unit where profit was $435 million.
Earlier this year, BCE was given regulatory approval to purchase the rest of the CTV assets that it didn’t already own. BCE had acquired majority ownership of the network about 10 years ago but later sold off all but about 15 per cent, only to buy back most of the shares from its partners.
Canada’s largest telecom company said it plans to use the content to put across wireless media platforms such as smartphones, personal computers and computer tablets.
BCE also boosted its full-year 2011 guidance to between $3.10 and $3.15 per share of adjusted earnings per share, up from between $3.05 and $3.10 that was predicted in May.
“As a result of our strong earnings result in the quarter, we are updating our adjusted EPS guidance upwards to reflect the earlier-than-expected resolution of tax matters in the third quarter,” said chief financial officer Siim Vanaselja.
