EX-99.3 4 suppq110.htm SUPPLEMENTARY FINANCIAL INFORMATION - FIRST QUARTER 2010 BCE Inc. Supplementary Financial Information – First Quarter 2010

EXHIBIT 99.3

BCE Inc. (1)
Consolidated Operational Data

 

  Q1     Q1              

($ millions, except per share amounts) (unaudited)

  2010     2009       $ change   % change  

Operating revenues

  4,432     4,331       101   2.3 %

Cost of revenue, exclusive of depreciation and amortization

  (1,174 )   (1,086 )     (88 ) (8.1 %)

Selling, general and administrative expenses (A)

  (1,446 )   (1,397 )     (49 ) (3.5 %)

Net benefit plans cost

  (28 )   (88 )     60   68.2 %

EBITDA (3)

  1,784     1,760       24   1.4 %

EBITDA margin (4)

  40.3 %   40.6 %         (0.3 ) pts

Depreciation

  (610 )   (625 )     15   2.4 %

Amortization of intangible assets

  (183 )   (193 )     10   5.2 %

Restructuring and other

  (29 )   (108 )     79   73.1 %

Operating income

  962     834       128   15.3 %

Other income

  120     1       119   n.m.  

Interest expense

  (165 )   (191 )     26   13.6 %

Pre-tax earnings from continuing operations

  917     644       273   42.4 %

Income tax expense

  (204 )   (148 )     (56 ) (37.8 %)

Non-controlling interest

  (76 )   (84 )     8   9.5 %

Earnings from continuing operations

  637     412       225   54.6 %

Discontinued operations

  -     (6 )     6   n.m.  

Net earnings

  637     406       231   56.9 %

Dividends on preferred shares

  (29 )   (29 )     -   -  

Net earnings applicable to common shares

  608     377       231   61.3 %

Net earnings per common share – basic

                       

Continuing operations

$ 0.79   $ 0.49     $ 0.30   61.2 %

Discontinued operations

$ -   $ (0.01 )   $ 0.01   n.m.  

Net earnings

$ 0.79   $ 0.48     $ 0.31   64.6 %

Net earnings per common share – diluted

                       

Continuing operations

$ 0.79   $ 0.49     $ 0.30   61.2 %

Discontinued operations

$ -   $ (0.01 )   $ 0.01   n.m.  

Net earnings

$ 0.79   $ 0.48     $ 0.31   64.6 %

Dividends per common share

$ 0.435   $ 0.385     $ 0.050   13.0 %

Average number of common shares outstanding – basic (millions)

  765.7     788.3              

Average number of common shares outstanding – diluted (millions)

  766.0     788.3              
                         

The following items are included in net earnings:

                       

Net gains (losses) on investments

                       

Continuing operations

  125     1       124   n.m.  

Discontinued operations

  -     -       -   -  

Restructuring and other

  (17 )   (70 )     53   75.7 %

Total

  108     (69 )     177   n.m.  

Impact on net earnings per share

$ 0.14   $ (0.09 )   $ 0.23   n.m.  

Adjusted EPS (3)

$ 0.65   $ 0.57     $ 0.08   14.0 %
                         
(A)

Excludes net benefit plans cost

n.m. : not meaningful

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 2

BCE Inc.
Consolidated Operational Data – Historical Trend

 

          Total                            

($ millions, except per share amounts) (unaudited)

  Q1 10       2009       Q4 09     Q3 09     Q2 09     Q1 09  

Operating revenues

  4,432       17,735       4,650     4,457     4,297     4,331  

Cost of revenue, exclusive of depreciation and amortization

  (1,174 )     (4,525 )     (1,258 )   (1,152 )   (1,029 )   (1,086 )

Selling, general and administrative expenses (A)

  (1,446 )     (5,766 )     (1,562 )   (1,418 )   (1,389 )   (1,397 )

Net benefit plans cost

  (28 )     (355 )     (93 )   (86 )   (88 )   (88 )

EBITDA

  1,784       7,089       1,737     1,801     1,791     1,760  

EBITDA margin

  40.3 %     40.0 %     37.4 %   40.4 %   41.7 %   40.6 %

Depreciation

  (610 )     (2,595 )     (704 )   (636 )   (630 )   (625 )

Amortization of intangible assets

  (183 )     (776 )     (200 )   (192 )   (191 )   (193 )

Restructuring and other

  (29 )     (527 )     (82 )   (191 )   (146 )   (108 )

Operating income

  962       3,191       751     782     824     834  

Other income (expense)

  120       (18 )     28     (24 )   (23 )   1  

Interest expense

  (165 )     (723 )     (182 )   (171 )   (179 )   (191 )

Pre-tax earnings from continuing operations

  917       2,450       597     587     622     644  

Income tax (expense) recovery

  (204 )     (368 )     (141 )   87     (166 )   (148 )

Non-controlling interest

  (76 )     (333 )     (79 )   (90 )   (80 )   (84 )

Earnings from continuing operations

  637       1,749       377     584     376     412  

Discontinued operations

  -       (11 )     (1 )   -     (4 )   (6 )

Net earnings

  637       1,738       376     584     372     406  

Dividends on preferred shares

  (29 )     (107 )     (26 )   (26 )   (26 )   (29 )

Net earnings applicable to common shares

  608       1,631       350     558     346     377  

Net earnings per common share – basic

                                       

Continuing operations

$ 0.79     $ 2.12     $ 0.46   $ 0.72   $ 0.45   $ 0.49  

Discontinued operations

$ -     $ (0.01 )   $ -   $ -   $ -   $ (0.01 )

Net earnings

$ 0.79     $ 2.11     $ 0.46   $ 0.72   $ 0.45   $ 0.48  

Net earnings per common share – diluted

                                       

Continuing operations

$ 0.79     $ 2.12     $ 0.46   $ 0.72   $ 0.45   $ 0.49  

Discontinued operations

$ -     $ (0.01 )   $ -   $ -   $ -   $ (0.01 )

Net earnings

$ 0.79     $ 2.11     $ 0.46   $ 0.72   $ 0.45   $ 0.48  

Dividends per common share

$ 0.435     $ 1.580     $ 0.405   $ 0.405   $ 0.385   $ 0.385  

Average number of common shares outstanding – basic (millions)

  765.7       772.9       767.2     767.2     769.0     788.3  

Average number of common shares outstanding – diluted (millions)

  766.0       772.9       767.3     767.2     769.0     788.3  
                                         

The following items are included in net earnings:

                                       

Net gains (losses) on investments

                                       

Continuing operations

  125       48       11     36     -     1  

Discontinued operations

  -       (7 )     -     (4 )   (3 )   -  

Restructuring and other

  (17 )     (339 )     (48 )   (123 )   (98 )   (70 )

Total

  108       (298 )     (37 )   (91 )   (101 )   (69 )

Impact on net earnings per share

$ 0.14     $ (0.39 )   $ (0.05 ) $ (0.12 ) $ (0.13 ) $ (0.09 )

Adjusted EPS

$ 0.65     $ 2.50     $ 0.51   $ 0.84   $ 0.58   $ 0.57  
 
(A)

Excludes net benefit plans cost

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 3

BCE Inc.
Segmented Data (2)

 

Q1   Q1            

($ millions, except where otherwise indicated) (unaudited)

2010   2009     $ change   % change  

Revenues

                 

Bell Wireline

2,658   2,592     66   2.5 %

Bell Wireless

1,153   1,078     75   7.0 %

Inter-segment eliminations

(53 ) (48 )   (5 ) (10.4 %)

Total Bell

3,758   3,622     136   3.8 %

Bell Aliant

779   818     (39 ) (4.8 %)

Inter-segment eliminations

(105 ) (109 )   4   3.7 %

Total BCE Inc.

4,432   4,331     101   2.3 %

EBITDA

                 

Bell Wireline

1,043   992     51   5.1 %

Margin

39.2 % 38.3 %       0.9  pts

Bell Wireless

412   434     (22 ) (5.1 %)

Margin

35.7 % 40.3 %       (4.6 ) pts

Total Bell

1,455   1,426     29   2.0 %

Margin

38.7 % 39.4 %       (0.7 ) pts

Bell Aliant

329   334     (5 ) (1.5 %)

Margin

42.2 % 40.8 %       1.4  pts

Total BCE Inc.

1,784   1,760     24   1.4 %

Margin

40.3 % 40.6 %       (0.3 ) pts

Operating income

                 

Bell Wireline

516   349     167   47.9 %

Bell Wireless

271   300     (29 ) (9.7 %)

Total Bell

787   649     138   21.3 %

Bell Aliant

175   185     (10 ) (5.4 %)

Total BCE Inc.

962   834     128   15.3 %

Capital expenditures

                 

Bell Wireline

379   352     (27 ) (7.7 %)

Capital Intensity (5)

14.3 % 13.6 %       (0.7 ) pts

Bell Wireless

52   130     78   60.0 %

Capital Intensity

4.5 % 12.1 %       7.6  pts

Total Bell

431   482     51   10.6 %

Capital Intensity

11.5 % 13.3 %       1.8  pts

Bell Aliant

95   108     13   12.0 %

Capital Intensity

12.2 % 13.2 %       1.0  pts

Total BCE Inc.

526   590     64   10.8 %

Capital Intensity

11.9 % 13.6 %       1.7  pts
                   
 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 4

BCE Inc.
Segmented Data – Historical Trend

 

      Total                    

($ millions, except where otherwise indicated) (unaudited)

Q1 10     2009     Q4 09   Q3 09   Q2 09   Q1 09  

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bell Wireline

2,658     10,666     2,840   2,659   2,575   2,592  

Bell Wireless

1,153     4,558     1,198   1,178   1,104   1,078  

Inter-segment eliminations

(53 )   (204 )   (56 ) (49 ) (51 ) (48 )

Total Bell

3,758     15,020     3,982   3,788   3,628   3,622  

Bell Aliant

779     3,174     785   786   785   818  

Inter-segment eliminations

(105 )   (459 )   (117 ) (117 ) (116 ) (109 )

Total BCE Inc.

4,432     17,735     4,650   4,457   4,297   4,331  

EBITDA

                           

Bell Wireline

1,043     3,907     960   973   982   992  

Margin

39.2 %   36.6 %   33.8 % 36.6 % 38.1 % 38.3 %

Bell Wireless

412     1,812     435   475   468   434  

Margin

35.7 %   39.8 %   36.3 % 40.3 % 42.4 % 40.3 %

Total Bell

1,455     5,719     1,395   1,448   1,450   1,426  

Margin

38.7 %   38.1 %   35.0 % 38.2 % 40.0 % 39.4 %

Bell Aliant

329     1,370     342   353   341   334  

Margin

42.2 %   43.2 %   43.6 % 44.9 % 43.4 % 40.8 %

Total BCE Inc.

1,784     7,089     1,737   1,801   1,791   1,760  

Margin

40.3 %   40.0 %   37.4 % 40.4 % 41.7 % 40.6 %

Operating income

                           

Bell Wireline

516     1,148     280   229   290   349  

Bell Wireless

271     1,284     292   354   338   300  

Total Bell

787     2,432     572   583   628   649  

Bell Aliant

175     759     179   199   196   185  

Total BCE Inc.

962     3,191     751   782   824   834  

Capital expenditures

                           

Bell Wireline

379     1,717     498   412   455   352  

Capital Intensity

14.3 %   16.1 %   17.5 % 15.5 % 17.7 % 13.6 %

Bell Wireless

52     673     142   177   224   130  

Capital Intensity

4.5 %   14.8 %   11.9 % 15.0 % 20.3 % 12.1 %

Total Bell

431     2,390     640   589   679   482  

Capital Intensity

11.5 %   15.9 %   16.1 % 15.5 % 18.7 % 13.3 %

Bell Aliant

95     464     120   115   121   108  

Capital Intensity

12.2 %   14.6 %   15.3 % 14.6 % 15.4 % 13.2 %

Total BCE Inc.

526     2,854     760   704   800   590  

Capital Intensity

11.9 %   16.1 %   16.3 % 15.8 % 18.6 % 13.6 %

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 5

Bell Wireline (2)

 

Q1   Q1        

($ millions, except where otherwise indicated) (unaudited)

2010   2009     % change  

Bell Wireline

             

Local & access

762   805     (5.3 %)

Long distance

238   278     (14.4 %)

Data

912   912     -  

Video

428   387     10.6 %

Equipment & other

237   133     78.2 %

Total external revenues

2,577   2,515     2.5 %

Inter-segment revenues

81   77     5.2 %

Total Bell Wireline operating revenue

2,658   2,592     2.5 %

Operating expenses

(1,615 ) (1,600 )   (0.9 %)

EBITDA

1,043   992     5.1 %

EBITDA Margin

39.2 % 38.3 %   0.9  pts

Operating income

516   349     47.9 %
               

Capital expenditures

379   352     (7.7 %)

Capital intensity

14.3 % 13.6 %   (0.7 ) pts
               

Local

             

Network access services (NAS)

             

Residential

3,810,912   4,143,305     (8.0 %)

Business

2,950,281   3,060,902     (3.6 %)

Total

6,761,193   7,204,207     (6.1 %)

Network access service net (losses)/activations

             

Residential

(75,618 ) (77,766 )   2.8 %

Business

(24,211 ) (26,473 )   8.5 %

Total

(99,829 ) (104,239 )   4.2 %

Internet

             

High Speed Internet net activations

10,467   6,288     66.5 %

High Speed Internet subscribers EOP

2,067,458   2,060,821     0.3 %

Video (DTH and VDSL)

             

Net subscriber activations

19,889   11,743     69.4 %

Total subscribers EOP

1,968,766   1,863,514     5.6 %

ARPU (6) ($/month)

72.60   68.84     5.5 %

Churn (7) (%) (average per month)

1.1 % 1.1 %   0.0  pts
 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 6

Bell Wireline – Historical Trend

 

      Total                    

($ millions, except where otherwise indicated) (unaudited)

Q1 10     2009     Q4 09   Q3 09   Q2 09   Q1 09  

Bell Wireline

                           

Local & access

762     3,159     775   783   796   805  

Long distance

238     1,078     265   264   271   278  

Data

912     3,696     973   892   919   912  

Video

428     1,593     417   400   389   387  

Equipment & other

237     817     324   241   119   133  

Total external revenues

2,577     10,343     2,754   2,580   2,494   2,515  

Inter-segment revenues

81     323     86   79   81   77  

Total Bell Wireline operating revenue

2,658     10,666     2,840   2,659   2,575   2,592  

Operating expenses

(1,615 )   (6,759 )   (1,880 ) (1,686 ) (1,593 ) (1,600 )

EBITDA

1,043     3,907     960   973   982   992  

EBITDA Margin

39.2 %   36.6 %   33.8 % 36.6 % 38.1 % 38.3 %

Operating income

516     1,148     280   229   290   349  
                             

Capital expenditures

379     1,717     498   412   455   352  

Capital intensity

14.3 %   16.1 %   17.5 % 15.5 % 17.7 % 13.6 %
                             

Local

                           

Network access services (NAS)

                           

Residential

3,810,912     3,886,530     3,886,530   3,965,540   4,041,926   4,143,305  

Business

2,950,281     2,974,492     2,974,492   3,002,985   3,029,686   3,060,902  

Total

6,761,193     6,861,022     6,861,022   6,968,525   7,071,612   7,204,207  

Network access service net (losses)/activations

                           

Residential

(75,618 )   (334,541 )   (79,010 ) (76,386 ) (101,379 ) (77,766 )

Business

(24,211 )   (112,883 )   (28,493 ) (26,701 ) (31,216 ) (26,473 )

Total

(99,829 )   (447,424 )   (107,503 ) (103,087 ) (132,595 ) (104,239 )

Internet

                           

High Speed Internet net activations

10,467     37,618     7,808   21,531   1,991   6,288  

High Speed Internet subscribers EOP (A)

2,067,458     2,056,991     2,056,991   2,084,343   2,062,812   2,060,821  

Video (DTH and VDSL)

                           

Net subscriber activations

19,889     113,315     40,889   40,665   20,018   11,743  

Total subscribers EOP (A)

1,968,766     1,948,877     1,948,877   1,924,197   1,883,532   1,863,514  

ARPU ($/month)

72.60     69.59     71.12   69.35   68.98   68.84  

Churn (%) (average per month)

1.1 %   1.2 %   1.3 % 1.4 % 1.1 % 1.1 %
 
(A)

Following a company-wide review of subscriber metrics, our Internet and Video customer base were reduced by 35,160 and 16,209, respectively, at the end of Q4 2009.

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 7

Bell Wireless (2)

 

Q1     Q1        

($ millions, except where otherwise indicated) (unaudited)

2010     2009     % change  

Bell Wireless

               
                 

Revenue

               

Service

1,056     986     7.1 %

Product

86     82     4.9 %

Total external Bell Wireless revenues

1,142     1,068     6.9 %

Inter-segment revenues

11     10     10.0 %

Total Bell Wireless operating revenues

1,153     1,078     7.0 %

Operating expenses

(741 )   (644 )   (15.1 %)

EBITDA

412     434     (5.1 %)

EBITDA margin (Total revenues)

35.7 %   40.3 %   (4.6 ) pts

EBITDA margin (Service revenues)

39.0 %   44.0 %   (5.0 ) pts

Operating Income

271     300     (9.7 %)
                 

Capital expenditures

52     130     60.0 %

Capital intensity

4.5 %   12.1 %   7.6  pts
                 

Wireless gross activations (A)

428,834     365,852     17.2 %

Postpaid

264,312     210,131     25.8 %

Wireless net activations (A)

55,625     30,295     83.6 %

Postpaid

81,212     35,021     n.m.  

Wireless subscribers EOP (A) (C)

6,888,927     6,527,816     5.5 %

Postpaid

5,122,442     4,780,188     7.2 %

Average revenue per unit (ARPU) (B) ($/month)

50.07     51.52     (2.8 %)

Prepaid

16.87     15.38     9.7 %

Postpaid

61.72     62.34     (1.0 %)

Churn (%) (B) (average per month)

1.8 %   1.6 %   (0.2 ) pts

Prepaid

3.4 %   2.9 %   (0.5 ) pts

Postpaid

1.2 %   1.2 %   0.0  pts

Usage per subscriber (B) (C) (min/month)

259     279     (7.2 %)

Cost of acquisition (COA) (8) (B) ($/sub)

362     397     8.8 %

PRO FORMA (D)

               

Average revenue per unit (ARPU) (D) ($/month)

50.07     49.84     0.5 %

Prepaid

16.87     16.05     5.1 %

Postpaid

61.72     62.24     (0.8 %)

Churn (%) (D) (average per month)

1.8 %   1.7 %   (0.1 ) pts

Prepaid

3.4 %   3.0 %   (0.4 ) pts

Postpaid

1.2 %   1.3 %   0.1  pts

Usage per subscriber (C) (D) (min/month)

259     271     (4.4 %)

Cost of acquisition (COA) (8) (D) ($/sub)

362     374     3.2 %
 
(A)

Total wireless gross activations, net activations and EOP subscribers include 100% of Virgin Mobile’s subscribers.
(B)

Beginning in Q3 2009, wireless average revenue per unit, churn, usage per subscriber and cost of acquisition reflect 100% of Virgin’s results due to our acquisition on July 1, 2009 of the remaining 50% not already owned. All prior periods reflect the original 50% ownership.
(C)

Following a company-wide review of subscriber metrics, we reduced subscribers by 34,752 for postpaid and 2,074 for prepaid as at the end of Q4 2009. The definition of usage per subscriber has been refined and all prior periods have been restated for comparability.
(D)

Wireless average revenue per unit, churn, usage per subscriber and cost of acquisition in the prior years have been restated to include 100% of Virgin Mobile results, rather than 50%.

 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 8

 

Bell Wireless – Historical Trend

 

      Total                          

($ millions, except where otherwise indicated) (unaudited)

Q1 10     2009     Q4 09     Q3 09     Q2 09     Q1 09  

Bell Wireless

                                 
                                   

Revenue

                                 

Service

1,056     4,102     1,055     1,056     1,005     986  

Product

86     405     129     106     88     82  

Total external Bell Wireless revenues

1,142     4,507     1,184     1,162     1,093     1,068  

Inter-segment revenues

11     51     14     16     11     10  

Total Bell Wireless operating revenues

1,153     4,558     1,198     1,178     1,104     1,078  

Operating expenses

(741 )   (2,746 )   (763 )   (703 )   (636 )   (644 )

EBITDA

412     1,812     435     475     468     434  

EBITDA margin (Total revenues)

35.7 %   39.8 %   36.3 %   40.3 %   42.4 %   40.3 %

EBITDA margin (Service revenues)

39.0 %   44.2 %   41.2 %   45.0 %   46.6 %   44.0 %

Operating Income

271     1,284     292     354     338     300  
                                   

Capital expenditures

52     673     142     177     224     130  

Capital intensity

4.5 %   14.8 %   11.9 %   15.0 %   20.3 %   12.1 %
                                   

Wireless gross activations (A)

428,834     1,794,237     523,739     500,895     403,751     365,852  

Postpaid

264,312     1,056,126     300,233     301,876     243,886     210,131  

Wireless net activations (A)

55,625     372,607     162,859     134,737     44,716     30,295  

Postpaid

81,212     330,815     109,921     121,692     64,181     35,021  

Wireless subscribers EOP (A) (C)

6,888,927     6,833,302     6,833,302     6,707,269     6,572,532     6,527,816  

Postpaid

5,122,442     5,041,230     5,041,230     4,966,061     4,844,369     4,780,188  

Average revenue per unit (ARPU) (B) ($/month)

50.07     51.70     51.08     52.13     52.05     51.52  

Prepaid

16.87     17.15     18.45     18.36     16.41     15.38  

Postpaid

61.72     62.87     62.47     64.09     62.58     62.34  

Churn (%) (B) (average per month)

1.8 %   1.7 %   1.8 %   1.8 %   1.7 %   1.6 %

Prepaid

3.4 %   3.2 %   3.2 %   3.5 %   3.3 %   2.9 %

Postpaid

1.2 %   1.3 %   1.3 %   1.3 %   1.3 %   1.2 %

Usage per subscriber (B) (C) (min/month)

259     287     281     291     299     279  

Cost of acquisition (COA) (B) ($/sub)

362     350     327     320     356     397  

PRO FORMA (D)

                                 

Average revenue per unit (ARPU) (D) ($/month)

50.07     50.88     51.08     52.13     50.46     49.84  

Prepaid

16.87     17.53     18.45     18.36     17.26     16.05  

Postpaid

61.72     62.81     62.47     64.09     62.48     62.24  

Churn (%) (D) (average per month)

1.8 %   1.8 %   1.8 %   1.8 %   1.8 %   1.7 %

Prepaid

3.4 %   3.2 %   3.2 %   3.5 %   3.3 %   3.0 %

Postpaid

1.2 %   1.3 %   1.3 %   1.3 %   1.3 %   1.3 %

Usage per subscriber (C) (D) (min/month)

259     283     281     291     290     271  

Cost of acquisition (COA) (D) ($/sub)

362     336     327     320     333     374  
 
(A)

Total wireless gross activations, net activations and EOP subscribers include 100% of Virgin Mobile’s subscribers.
(B)

Beginning in Q3 2009, wireless average revenue per unit, churn, usage per subscriber and cost of acquisition reflect 100% of Virgin’s results due to our acquisition on July 1, 2009 of the remaining 50% not already owned. All prior periods reflect the original 50% ownership.
(C)

Following a company-wide review of subscriber metrics, we reduced subscribers by 34,752 for postpaid and 2,074 for prepaid as at the end of Q4 2009. The definition of usage per subscriber has been refined and all prior periods have been restated for comparability.
(D)

Wireless average revenue per unit, churn, usage per subscriber and cost of acquisition in the prior years have been restated to include 100% of Virgin Mobile results, rather than 50%.

  

   BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 9

 

BCE Inc.
Net debt and other information (2)

BCE Inc. – Net debt and preferreds

               
                 

At March 31, 2010

      BCE Inc.        

(unaudited)

               

($ millions, except where otherwise indicated)

               

 

      Bell        

 

Bell     Aliant     BCE Inc.  

Debt due within one year

580     167     747  

Long-term debt

7,543     2,758     10,301  

Securitization of accounts receivable

1,140     165     1,305  

Preferred shares – BCE

2,770     -     2,770  

Cash and cash equivalents

(730 )   (18 )   (748 )

Net debt

11,303     3,072     14,375  

Bell – Balance Sheet Information

         

(unaudited)

         

($ millions, except where otherwise indicated)

March 31     Dec. 31  

 

2010     2009  
           

Debt due within one year

580     543  

Long-term debt

7,543     7,541  

Securitization of accounts receivable

1,140     1,140  

Preferred shares – BCE

2,770     2,770  

Cash and cash equivalents

(730 )   (660 )

Net Debt

11,303     11,334  
           

Net Debt: Trailing 12 month EBITDA, including Bell Aliant distributions to BCE

1.87     1.89  

EBITDA, including Bell Aliant distributions to BCE: Net interest, securitization costs and preferred dividends (trailing 12 months)

9.17     8.79  

Cash Flow Information

                     

(unaudited)

Q1     Q1              

($ millions, except where otherwise indicated)

2010     2009     $ change     % change  
                       

Free Cash Flow (FCF)

                     

Cash from operating activities

953     723     230     31.8 %

Capital expenditures

(431 )   (482 )   51     10.6 %

Other investing activities

(22 )   (14 )   (8 )   (57.1 %)

Dividends paid on preferred shares

(28 )   (28 )   -     -  

Bell Aliant distributions to BCE

73     73     -     -  

FCF

545     272     273     n.m.  
                       
                       

Cash Flow Information – Historical Trend

                                 

(unaudited)

Q1     Total     Q4     Q3     Q2     Q1  

($ millions, except where otherwise indicated)

2010     2009     2009     2009     2009     2009  
                                   

Free Cash Flow (FCF)

                                 

Cash from operating activities

953     3,755     621     1,230     1,181     723  

Capital expenditures

(431 )   (2,390 )   (640 )   (589 )   (679 )   (482 )

Other investing activities

(22 )   (93 )   (12 )   (39 )   (28 )   (14 )

Dividends paid on preferred shares

(28 )   (107 )   (26 )   (26 )   (27 )   (28 )

Bell Aliant distributions to BCE

73     291     72     73     73     73  

FCF

545     1,456     15     649     520     272  
                                   

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 10

 

BCE Inc.
Consolidated Balance Sheet Data

 

March 31     December 31  

($ millions, except where otherwise indicated) (unaudited)

2010     2009  

ASSETS

         

Current assets

         

Cash and cash equivalents

748     687  

Accounts receivable

1,523     1,605  

Future income taxes

128     110  

Inventory

446     448  

Prepaid expenses

389     296  

Other current assets

145     137  

Current assets of discontinued operations

1     1  

Total current assets

3,380     3,284  

Capital assets

         

Property, plant and equipment

19,381     19,441  

Finite-life intangible assets

2,483     2,541  

Indefinite-life intangible assets

3,817     3,803  

Total capital assets

25,681     25,785  

Other long-term assets

3,126     3,207  

Goodwill

5,774     5,774  

Total assets

37,961     38,050  

LIABILITIES

         

Current liabilities

         

Accounts payable and accrued liabilities

3,568     3,716  

Interest payable

133     113  

Dividends payable

375     354  

Debt due within one year

747     600  

Current liabilities of discontinued operations

3     3  

Total current liabilities

4,826     4,786  

Long-term debt

10,301     10,299  

Other long-term liabilities

4,808     4,942  

Total liabilities

19,935     20,027  

Non-controlling interest

1,031     1,049  

SHAREHOLDERS’ EQUITY

         

Preferred shares

2,770     2,770  

Common shareholders’ equity

         

Common shares

12,851     12,921  

Contributed surplus

2,485     2,490  

Accumulated other comprehensive income

(38 )   92  

Deficit

(1,073 )   (1,299 )

Total common shareholders’ equity

14,225     14,204  

Total shareholders’ equity

16,995     16,974  

Total liabilities and shareholders’ equity

37,961     38,050  
           

Number of common shares outstanding

763.0     767.2  
 

 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 11

BCE Inc.
Consolidated Cash Flow Data

 

  Q1       Q1          

($ millions, except where otherwise indicated) (unaudited)

  2010       2009       $ change  

Cash flows from operating activities

                     

Net earnings

  637       406       231  

Less: Losses from discontinued operations, net of income taxes and non-controlling interest

  -       (6 )     6  

Earnings from continuing operations

  637       412       225  

Adjustments to reconcile earnings from continuing operations to cash flows from operating activities

                     

Depreciation and amortization of intangible assets

  793       818       (25 )

Net benefit plans cost

  28       88       (60 )

Restructuring and other

  29       108       (79 )

Gains on investments

  (125 )     (2 )     (123 )

Future income taxes

  24       (13 )     37  

Non-controlling interest

  76       84       (8 )

Contributions to employee pension plans

  (155 )     (92 )     (63 )

Other employee future benefit plan payments

  (24 )     (24 )     -  

Payments of restructuring and other

  (94 )     (77 )     (17 )

Operating assets and liabilities

  (91 )     (377 )     286  

Cash flows from operating activities

  1,098       925       173  

Bell Aliant distributions to BCE

  73       73       -  

Capital expenditures

  (526 )     (590 )     64  

Other investing activities

  (21 )     (13 )     (8 )

Cash dividends paid on preferred shares

  (28 )     (28 )     -  

Cash distributions paid by subsidiaries to non-controlling interest

  (92 )     (92 )     -  

Bell Aliant Free Cash Flow

  41       (3 )     44  

Free Cash Flow (3)

  545       272       273  

Bell Aliant undistributed Free Cash Flow

  (114 )     (70 )     (44 )

Business acquisitions

  9       (20 )     29  

Going-private costs

  -       (6 )     6  

Decrease in investments

  10       -       10  

Increase in notes payable and bank advances

  112       88       24  

Repayment of long-term debt

  (56 )     (94 )     38  

Cash dividends paid on common shares

  (310 )     (294 )     (16 )

Issue of common shares

  1       1       -  

Repurchase of common shares

  (125 )     (557 )     432  

Other financing activities

  (11 )     (10 )     (1 )

 

  (484 )     (962 )     478  

Cash flows from (used in) continuing operations

  61       (690 )     751  

Cash flows used in discontinued operations activities

  -       (8 )     8  

Net increase (decrease) in cash and cash equivalents

  61       (698 )     759  

Cash and cash equivalents at beginning of period

  688       3,063       (2,375 )

Cash and cash equivalents at end of period

  749       2,365       (1,616 )

Consists of:

                     

Cash and cash equivalents of continuing operations

  748       2,356       (1,608 )

Cash and cash equivalents of discontinued operations

  1       9       (8 )

Total

  749       2,365       (1,616 )
                       

Other information

                     

Cash flow per share (9)

$ 0.75     $ 0.42     $ 0.33  

Annualized cash flow yield (10)

  7.6 %     8.5 %     (0.9 ) pts

Common dividend payout (11)

  66.9 %     67.5 %     (0.6 ) pts
 

 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 12

BCE Inc.
Consolidated Cash Flow Data – Historical Trend

 

          Total                                  

($ millions, except where otherwise indicated) (unaudited)

  Q1 10       2009       Q4 09       Q3 09       Q2 09       Q1 09  

Cash flows from operating activities

                                             

Net earnings

  637       1,738       376       584       372       406  

Less: Losses from discontinued operations, net of income taxes and non-controlling interest

  -       (11 )     (1 )     -       (4 )     (6 )

Earnings from continuing operations

  637       1,749       377       584       376       412  

Adjustments to reconcile earnings from continuing operations to cash flows from operating activities

                                             

Depreciation and amortization of intangible assets

  793       3,371       904       828       821       818  

Net benefit plans cost

  28       355       93       86       88       88  

Restructuring and other

  29       527       82       191       146       108  

Gains on investments

  (125 )     (49 )     (11 )     (36 )     -       (2 )

Future income taxes

  24       32       278       (228 )     (5 )     (13 )

Non-controlling interest

  76       333       79       90       80       84  

Contributions to employee pension plans

  (155 )     (1,068 )     (785 )     (99 )     (92 )     (92 )

Other employee future benefit plan payments

  (24 )     (96 )     (24 )     (25 )     (23 )     (24 )

Payments of restructuring and other

  (94 )     (310 )     (58 )     (70 )     (105 )     (77 )

Operating assets and liabilities

  (91 )     40       13       216       188       (377 )

Cash flows from operating activities

  1,098       4,884       948       1,537       1,474       925  

Bell Aliant distributions to BCE

  73       291       72       73       73       73  

Capital expenditures

  (526 )     (2,854 )     (760 )     (704 )     (800 )     (590 )

Other investing activities

  (21 )     (89 )     (11 )     (38 )     (27 )     (13 )

Cash dividends paid on preferred shares

  (28 )     (107 )     (26 )     (26 )     (27 )     (28 )

Cash distributions paid by subsidiaries to non-controlling interest

  (92 )     (369 )     (92 )     (93 )     (92 )     (92 )

Bell Aliant Free Cash Flow

  41       (300 )     (116 )     (100 )     (81 )     (3 )

Free Cash Flow

  545       1,456       15       649       520       272  

Bell Aliant undistributed Free Cash Flow

  (114 )     9       44       27       8       (70 )

Business acquisitions

  9       (338 )     (4 )     (313 )     (1 )     (20 )

Business dispositions

  -       11       1       10       -       -  

Going-private costs

  -       (7 )     -       -       (1 )     (6 )

Increase in investments

  -       (53 )     (50 )     (2 )     (1 )     -  

Decrease in investments

  10       113       58       55       -       -  

Increase (decrease) in notes payable and bank advances

  112       (194 )     (39 )     (5 )     (238 )     88  

Issue of long-term debt

  -       1,348       -       -       1,348       -  

Repayment of long-term debt

  (56 )     (2,539 )     (203 )     (656 )     (1,586 )     (94 )

Cash dividends paid on common shares

  (310 )     (1,201 )     (310 )     (296 )     (301 )     (294 )

Issue of common shares

  1       2       -       -       1       1  

Repurchase of common shares

  (125 )     (894 )     -       -       (337 )     (557 )

Other financing activities

  (11 )     (90 )     (11 )     (38 )     (31 )     (10 )

 

  (484 )     (3,833 )     (514 )     (1,218 )     (1,139 )     (962 )

Cash flows from (used in) continuing operations

  61       (2,377 )     (499 )     (569 )     (619 )     (690 )

Cash flows (used in) from discontinued operations activities

  -       (9 )     (2 )     (2 )     3       (8 )

Cash flows from (used in) discontinued investing activities

  -       11       -       (6 )     17       -  

Net increase (decrease) in cash and cash equivalents

  61       (2,375 )     (501 )     (577 )     (599 )     (698 )

Cash and cash equivalents at beginning of period

  688       3,063       1,189       1,766       2,365       3,063  

Cash and cash equivalents at end of period

  749       688       688       1,189       1,766       2,365  

Consists of:

                                             

Cash and cash equivalents of continuing operations

  748       687       687       1,187       1,761       2,356  

Cash and cash equivalents of discontinued operations

  1       1       1       2       5       9  

Total

  749       688       688       1,189       1,766       2,365  
                                               

Other information

                                             

Cash flow per share

$ 0.75     $ 2.63     $ 0.25      $ 1.08       $ 0.88       $ 0.42  

Annualized cash flow yield

  7.6 %     6.5 %     6.5 %     10.3 %     8.3 %     8.5 %

Common dividend payout

  66.9 %     63.2 %     79.4 %     48.2 %     66.4 %     67.5 %

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 13

Accompanying Notes

(1)

Throughout this report, BCE means BCE Inc., its subsidiaries and joint ventures; Bell means our Bell Wireline and Bell Wireless segments on an aggregate basis; and Bell Aliant means Bell Aliant Regional Communications Income Fund and its subsidiaries.
 
(2)

We report our results of operations in three segments: Bell Wireline, Bell Wireless and Bell Aliant. Our reporting structure reflects how we manage our business and how we classify our operations for planning and measuring performance. Accordingly, we operate and manage our reportable segments as strategic business units organized by products and services.
 
(3)

Non-GAAP Financial Measures

EBITDA
The term EBITDA (earnings before interest, taxes, depreciation and amortization of intangible assets) does not have any standardized meaning according to Canadian generally accepted accounting principles (GAAP). It is therefore unlikely to be comparable to similar measures presented by other companies.

We define EBITDA as operating revenues less cost of revenue, selling, general and administrative expenses and net benefit plans costs, meaning it represents operating income before depreciation, amortization of intangible assets and restructuring and other.

We use EBITDA, among other measures, to assess the operating performance of our ongoing businesses without the effects of depreciation, amortization of intangible assets and restructuring and other. We exclude these items because they affect the comparability of our financial results and could potentially distort the analysis of trends in business performance. We exclude depreciation and amortization of intangible assets because it largely depends on the accounting methods and assumptions a company uses, as well as non-operating factors, such as the historical cost of capital assets. Excluding restructuring and other does not imply they are non-recurring.

EBITDA allows us to compare our operating performance on a consistent basis. We believe that certain investors and analysts use EBITDA to measure a company’s ability to service debt and to meet other payment obligations, or as a common measurement to value companies in the telecommunications industry.

The most comparable Canadian GAAP financial measure is operating income.

Adjusted earnings per share (EPS)
The term adjusted EPS does not have any standardized meaning according to Canadian GAAP. It is therefore unlikely to be comparable to similar measures presented by other companies.

We define adjusted EPS as EPS before restructuring and other and net losses (gains) on investments.
 

 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 14

Accompanying Notes

 

We use adjusted EPS among other measures, to assess the operating performance of our ongoing businesses without the effects of after-tax restructuring and other and net losses (gains) on investments. We exclude these items because they affect the comparability of our financial results and could potentially distort the analysis of trends in business performance. Excluding these items does not imply they are non-recurring.

The most comparable Canadian GAAP financial measure is EPS.

FREE CASH FLOW
The term free cash flow does not have any standardized meaning according to Canadian GAAP. It is therefore unlikely to be comparable to similar measures presented by other companies.

We define free cash flow as cash from operating activities and distributions received from Bell Aliant less capital expenditures, preferred share dividends, distributions paid by subsidiaries to non-controlling interest, other investing activities and Bell Aliant free cash flow.

We consider free cash flow to be an important indicator of the financial strength and performance of our business because it shows how much cash is available to repay debt and to reinvest in our company. We present free cash flow on a consistent basis from period to period, which allows us to compare our financial performance on a consistent basis.

We believe that certain investors and analysts use free cash flow when valuing a business and its underlying assets.

The most comparable Canadian GAAP financial measure is cash from operating activities.
 
(4)

EBITDA margin is calculated as follows:

EBITDA
Operating revenues
 
(5)

Capital Intensity is calculated as follows:

Capital expenditures
Operating revenues
 
(6)

Average revenue per unit (ARPU) represents the measurement of the average revenue generated by each unit, expressed as a rate per month for the year.
 
(7)

Churn is the rate at which existing subscribers cancel their services. Churn is calculated as the number of subscribers disconnected divided by the average subscriber base.
 
(8)

Cost of acquisition (COA) is also referred to as subscriber acquisition costs. This measure is expressed per gross activation. It includes costs associated with acquiring a customer such as hardware subsidies, marketing and distribution costs.

 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 15

Accompanying Notes

(9)

Cash flow per share is calculated as follows:

Cash flow from operating activities less capital expenditures
Average number of common shares outstanding
 
(10)

Annualized cash flow yield is calculated as follows:

Trailing 12 month free cash flow
Number of common shares outstanding at end of period multiplied by share price at end of period
 
(11)

Common dividend payout is calculated as follows:

Dividends per common share
Adjusted EPS

 

BCE Inc. Supplementary Financial Information – First Quarter 2010  Page 16