Yahoo Finance BCE's Q1 Earnings Beat Estimates, Revenues Increase Y/Y
BCE Inc. BCE reported first-quarter 2023 adjusted earnings per share of C$0.85 (63 cents) compared with C$0.89 in the prior-year quarter. The Zacks Consensus Estimate for the same was pegged at 60 cents.
Quarterly total operating revenues moved up 3.5% year over year to C$6,054 million ($4,477.4 million). The consensus estimate was pegged at $4,427 million. This was driven by a 0.9% rise in service revenues, which totaled C$5,222 million, and Product revenues improved 23.6% to C$832 million.
The uptick was due to solid residential Internet growth and higher Bell Communication and Technology Services (Bell CTS) sales.
BCE, Inc. Price, Consensus and EPS Surprise
BCE, Inc. price-consensus-eps-surprise-chart | BCE, Inc. Quote
Segmental Results
The company announced that it had combined its Bell Wireless and Bell Wireline operating segments to form a segment called Bell CTS. Going Forward, the company will report its segment results under Bell CTS and Bell Media.
Bell CTS’ operating revenues increased 4.9% year over year to C$5,367 million, driven by strong service and product revenue growth.
Service revenues jumped 2.1% to C$4,535 million, driven by growth in mobile phone, connected device subscriber bases, retail Internet subscriber base growth and higher blended mobile phone average revenue per user. This was partly offset by the continued decline in legacy voice, data and satellite TV services and the sale of Createch on Mar 1, 2022.
Product revenues were up 23.6% to C$832 million, driven by sales of expensive mobile phones and increased mobile transactions coupled with higher sales of data equipment to enterprise business customers resulting from timings of deals and easier comparison, owing to supply chain constraints in the prior-year quarter.
Postpaid mobile phone net subscriber activations were 43,289, up 26.5% year over year. The number of postpaid mobile phone net subscriber activations rose as a result of higher in-store foot traffic than the previous year, sustained momentum of 5G, immigration growth, stronger business client demand and successful promotion.
Prepaid mobile phone and net subscriber activations decreased owing to higher customer churn due to promotional offers on postpaid plans.
Bell Media generated revenues of C$780 million, falling 5.5% year over year. The revenues decreased due to lower subscribers and advertisers.
Other Details
Adjusted EBITDA in the reported quarter was C$2,538 million, down 1.8% year over year. The downfall was due to a decrease of 36.5% in the media segment, partly offset by the increase of 1.3% in the CTS segment. The adjusted EBITDA margin was 41.9% compared with 44.2% in the prior-year quarter.
Cash Flow
BCE generated C$1,247 million of cash from operating activities compared with C$1,716 million in the prior-year quarter. The free cash flow was C$85 million compared with C$716 million a year ago due to lower cash flows from operating activities.
2023 Outlook
BCE issued the financial guidance for 2023. It expects revenue growth between 1% and 5% and adjusted EBITDA between 2% and 5%. Adjusted earnings per share are estimated to decrease 3-7% owing to lower tax adjustments and higher expected depreciation and amortization expense.
Free cash flow growth is projected to be 2-10%. The annualized common dividend per share is estimated to be C$3.87.
The company has declared a quarterly dividend of C$0.9675 cents per share, payable on Jul 17, to shareholders of record on Jun 15, 2023.
Zacks Rank & Stocks to Consider
BCE currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader technology space are Dropbox DBX, Badger Meter BMI and Enfusion ENFN, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Dropbox’s 2023 earnings has increased 1.8% in the past 60 days to $1.71 per share. The long-term earnings growth rate is anticipated to be 11.5%.
Dropbox’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.4%. Shares of DBX have increased 4.1% in the past year.
The Zacks Consensus Estimate for Badger Meter’s 2023 earnings has increased 4.7% in the past 60 days to $2.69 per share.
Badger Meter’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 5.3%. Shares of BMI have increased 80.2% in the past year.
The Zacks Consensus Estimate for Enfusion’s 2023 earnings has increased 5.6% in the past 60 days to 19 cents per share.
Enfusion’s earnings beat the Zacks Consensus Estimate in two of the last four quarters, the average surprise being 18.8%. Shares of the company have decreased 23.4% in the past year.
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