BCE’s sales dip slightly, profits rise on one-offs; Bell buys Virgin Mobile Canada

8 May 2009

Canada’s largest full-service telecoms group BCE’s consolidated revenues fell by 0.4% year-on-year to CAD4.342 billion (USD3.714 billion) in the first quarter of 2009, due to lower turnover at both its main subsidiaries Bell Canada and Bell Aliant. However, BCE’s quarterly operating income in the three months to the end of March increased by 27.5% to CAD829 million, due to higher operating income at Bell Canada and Bell Aliant, and EBITDA also rose slightly, by 0.3% to CAD1.757 billion due to EBITDA growth at both telcos. Group net profit jumped 46.1% to CAD377 million, but mainly due to the effect of one-off charges taken in the first quarter of 2008.

Bell Canada also announced that it has bought the other half of mobile virtual network operator (MVNO) Virgin Mobile Canada for CAD142 million as it prepares to face an influx of new competitors following last year’s national wireless spectrum auction. Along with 100% ownership of the successful venture, Bell will also receive exclusive, long-term rights to use Sir Richard Branson’s Virgin brand. While Virgin will continue as a standalone operation for now, Bell has also indicated that it may consolidate the MVNO with its existing wholly owned virtual mobile brand Solo in the future.