EX-99.2 3 supp_q22011.htm SUPPLEMENTARY FINANCIAL INFORMATION - SECOND QUARTER 2011 Supplementary Financial Information - Q2 2011

EXHIBIT 99.2

 

 


BCE Inc. (1)
Consolidated Operational Data

($ millions of Canadian dollars, except per share amounts) (unaudited) 

   Q2
2011		       Q2
2010		       $ change   % change       YTD
2011		       YTD
2010		       $ change   % change  
                                                       

Operating revenues 

   4,955       4,440       515   11.6 %      9,421       8,873       548   6.2 % 

Operating costs (A) 

   (2,908 )      (2,548 )      (360 )  (14.1 %)      (5,482 )      (5,175 )      (307 )  (5.9 %) 

Pension current service costs 

   (61 )      (49 )      (12 )  (24.5 %)      (120 )      (102 )      (18 )  (17.6 %) 

EBITDA (3) 

   1,986       1,843       143   7.8 %      3,819       3,596       223   6.2 % 

EBITDA margin (5) 

  

40.1

 %    

41.5

 %         

(1.4

 ) pts     

40.5

 %     

40.5

 %         

-

  

Depreciation 

   (638 )      (595 )      (43 )  (7.2 %)      (1,249 )      (1,181 )      (68 )  (5.8 %) 

Amortization of intangible assets 

   (183 )      (183 )      -   -       (362 )      (363 )      1   0.3 % 

Severance, acquisition and other costs 

   (219 )      (15 )      (204 )  n.m.       (280 )      (47 )      (233 )  n.m.  

Finance costs 

                                                      

Interest expense 

   (226 )      (170 )      (56 )  (32.9 %)      (417 )      (342 )      (75 )  (21.9 %) 

Interest on employee benefit obligations 

   (247 )      (248 )      1   0.4 %      (489 )      (496 )      7   1.4 % 

Interest on fund unit liability 

   -       (93 )      93   100.0 %      -       (185 )      185   100.0 % 

Expected return on pension plan assets 

   259       224       35   15.6 %      513       449       64   14.3 % 

Other income 

   145       39       106   n.m.       123       308       (185 )  (60.1 %) 

Earnings before income taxes 

   877       802       75   9.4 %      1,658       1,739       (81 )  (4.7 %) 

Income taxes 

   (194 )      (172 )      (22 )  (12.8 %)      (393 )      (375 )      (18 )  (4.8 %) 

Net earnings 

   683       630       53   8.4 %      1,265       1,364       (99 )  (7.3 %) 

Net earnings attributable to: 

                                                      

Common shareholders 

   590       605       (15 )  (2.5 %)      1,093       1,311       (218 )  (16.6 %) 

Preferred shareholders 

   31       27       4   14.8 %      60       56       4   7.1 % 

Non-controlling interest 

   62       (2 )      64   n.m.       112       (3 )      115   n.m.  

Net earnings 

   683       630       53   8.4 %      1,265       1,364       (99 )  (7.3 %) 

Net earnings per common share - basic 

 $ 0.76     $ 0.80     $  (0.04 )  (5.0 %)    $  1.43     $ 1.72     $  (0.29 )  (16.9 %) 

Net earnings per common share - diluted 

 $ 0.76     $ 0.80     $  (0.04 )  (5.0 %)    $  1.43     $ 1.72     $  (0.29 )  (16.9 %) 
                                                       

Dividends per common share 

 $ 0.5175     $ 0.4350     $  0.0825   19.0 %    $  1.010     $ 0.8700     $  0.1400   n.m.  
                                                       

Average number of common shares outstanding - basic (millions) 

   776.6       759.7                   764.8       762.6              

Average number of common shares outstanding - diluted (millions) 

   777.1       760.1                   765.3       762.9              

Number of common shares outstanding (millions) 

   777.5       759.1                   777.5       759.1              
                                                       

Adjusted Net Earnings and EPS 

                                                      

Net earnings attributable to common shareholders 

   590       605       (15 )  (2.5 %)      1,093       1,311       (218 )  (16.6 %) 

Severance, acquisition and other costs 

   162       6       156   n.m.       202       31       171   n.m.  

Net gains on investments 

   (89 )      (8 )      (81 )  n.m.       (89 )      (133 )      44   33.1 % 

Fair value adjustment on fund unit liability 

   -       (16 )      16   100.0 %      -       (163 )      163   100.0 % 

Adjustment to reflect interest on fund unit liability as non-controlling interest 

   -       8       (8 )  100.0 %      -       16       (16 )  (100.0 %) 

Adjusted net earnings attributable to common shareholders 

   663       595       68   11.4 %      1,206       1,062       144   13.6 % 

Impact on net earnings per share 

 $ 0.10     $ (0.02 )    $  0.12   n.m.     $  0.15     $ (0.33 )    $  0.48   n.m.  
                                                       

Adjusted EPS (4) 

 $ 0.86     $ 0.78     $  0.08   10.3 %    $  1.58     $ 1.39     $  0.19   13.7 % 
                                                       

 

(A)

Excludes pension current service costs

n.m. : not meaningful

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 2

 


BCE Inc.
Consolidated Operational Data - Historical Trend

($ millions of Canadian dollars, except per share amounts) (unaudited) 

   YTD
2011		     Q2 11     Q1 11       Total
2010		       Q4 10     Q3 10     Q2 10     Q1 10  

Operating revenues 

   9,421     4,955     4,466       18,069       4,679     4,517     4,440     4,433  

Operating costs (A) 

   (5,482 )    (2,908 )    (2,574 )      (10,684 )      (2,882 )    (2,627 )    (2,548 )    (2,627 ) 

Pension current service costs 

   (120 )    (61 )    (59 )      (200 )      (49 )    (49 )    (49 )    (53 ) 

EBITDA 

   3,819     1,986     1,833       7,185       1,748     1,841     1,843     1,753  

EBITDA margin 

  

40.5

 %   

40.1

 %   

41.0

 %     

39.8

 %     

37.4

 %   

40.8

 %   

41.5

 %   

39.5

 % 

Depreciation 

   (1,249 )    (638 )    (611 )      (2,388 )      (607 )    (600 )    (595 )    (586 ) 

Amortization of intangible assets 

   (362 )    (183 )    (179 )      (737 )      (193 )    (181 )    (183 )    (180 ) 

Severance, acquisition and other costs 

   (280 )    (219 )    (61 )      (262 )      (86 )    (129 )    (15 )    (32 ) 

Finance costs 

                                                    

Interest expense 

   (417 )    (226 )    (191 )      (685 )      (174 )    (169 )    (170 )    (172 ) 

Interest on employee benefit obligations 

   (489 )    (247 )    (242 )      (992 )      (248 )    (248 )    (248 )    (248 ) 

Interest on fund unit liability 

   -     -     -       (370 )      (93 )    (92 )    (93 )    (92 ) 

Expected return on pension plan assets 

   513     259     254       898       224     225     224     225  

Other income (expense) 

   123     145     (22 )      173       (68 )    (67 )    39     269  

Earnings before income taxes 

   1,658     877     781       2,822       503     580     802     937  

Income taxes 

   (393 )    (194 )    (199 )      (632 )      (159 )    (98 )    (172 )    (203 ) 

Net earnings 

   1,265     683     582       2,190       344     482     630     734  

Net earnings attributable to: 

                                                    

Common shareholders 

   1,093     590     503       2,083       318     454     605     706  

Preferred shareholders 

   60     31     29       112       29     27     27     29  

Non-controlling interest 

   112     62     50       (5 )      (3 )    1     (2 )    (1 ) 

Net earnings 

   1,265     683     582       2,190       344     482     630     734  
 

Net earnings per common share - basic 

 $ 1.43   $ 0.76   $ 0.67     $ 2.74     $ 0.42   $ 0.60   $ 0.80   $ 0.92  

Net earnings per common share - diluted 

 $ 1.43   $ 0.76   $ 0.67     $ 2.74     $ 0.42   $ 0.60   $ 0.80   $ 0.92  
 

Dividends per common share 

 $ 1.010   $ 0.5175   $ 0.4925     $ 1.785     $ 0.4575   $ 0.4575   $ 0.4350   $ 0.4350  
 

Average number of common shares outstanding - basic (millions) 

   764.8     776.6     752.9       759.0       754.1     756.7     759.7     765.7  

Average number of common shares outstanding - diluted (millions) 

   765.3     777.1     753.5       759.5       755.0     757.3     760.1     766.0  

Number of common shares outstanding (millions) 

   777.5     777.5     754.1       752.3       752.3     755.6     759.1     763.0  
 

Adjusted Net Earnings and EPS 

                                                    

Net earnings attributable to common shareholders 

   1,093     590     503       2,083       318     454     605     706  

Severance, acquisition and other costs 

   202     162     40       189       67     91     6     25  

Net gains on investments 

   (89 )    (89 )    -       (133 )      -     -     (8 )    (125 ) 

Fair value adjustment on fund unit liability 

   -     -     -       (49 )      58     56     (16 )    (147 ) 

Adjustment to reflect interest on fund unit liability as non-controlling interest 

   -     -     -       29       3     10     8     8  

Adjusted net earnings attributable to common shareholders 

   1,206     663     543       2,119       446     611     595     467  

Impact on net earnings per share 

 $ 0.15   $ 0.10   $ 0.05     $ 0.05     $ 0.17   $ 0.21   $ (0.02 )  $ (0.31 ) 
 

Adjusted EPS 

 $ 1.58   $ 0.86   $ 0.72     $ 2.79     $ 0.59   $ 0.81   $ 0.78   $ 0.61  

 

(A)

Excludes pension current service costs

 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 3

 


BCE Inc.
Segmented Data (2)

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 Q2
2011		   Q2
2010		     $ change   % change     YTD
2011		   YTD
2010		     $ change   % change  

 

                                      

Revenues 

                                      

Bell Wireline 

 2,630   2,685     (55 )  (2.0 %)    5,302   5,432     (130 )  (2.4 %) 

Bell Wireless 

 1,276   1,203     73   6.1 %    2,527   2,349     178   7.6 % 

Bell Media 

 529   -     529   n.m.     529   -     529   n.m.  

Inter-segment eliminations 

 (73 )  (45 )    (28 )  (62.2 %)    (114 )  (93 )    (21 )  (22.6 %) 

Total Bell 

 4,362   3,843     519   13.5 %    8,244   7,688     556   7.2 % 

Bell Aliant 

 692   700     (8 )  (1.1 %)    1,374   1,389     (15 )  (1.1 %) 

Inter-segment eliminations 

 (99 )  (103 )    4   3.9 %    (197 )  (204 )    7   3.4 % 

Total BCE Inc. 

 4,955   4,440     515   11.6 %    9,421   8,873     548   6.2 % 
                                       

Operating costs 

                                      

Bell Wireline 

 (1,559 )  (1,640 )    81   4.9 %    (3,187 )  (3,383 )    196   5.8 % 

Bell Wireless 

 (816 )  (747 )    (69 )  (9.2 %)    (1,606 )  (1,482 )    (124 )  (8.4 %) 

Bell Media 

 (406 )  -     (406 )  n.m.     (406 )  -     (406 )  n.m.  

Inter-segment eliminations 

 73   45     28   62.2 %    114   93     21   22.6 % 

Total Bell 

 (2,708 )  (2,342 )    (366 )  (15.6 %)    (5,085 )  (4,772 )    (313 )  (6.6 %) 

Bell Aliant 

 (360 )  (358 )    (2 )  (0.6 %)    (714 )  (709 )    (5 )  (0.7 %) 

Inter-segment eliminations 

 99   103     (4 )  (3.9 %)    197   204     (7 )  (3.4 %) 

Total BCE Inc. 

 (2,969 )  (2,597 )    (372 )  (14.3 %)    (5,602 )  (5,277 )    (325 )  (6.2 %) 
                                       

EBITDA 

                                      

Bell Wireline 

 1,071   1,045     26   2.5 %    2,115   2,049     66   3.2 % 

Margin 

 40.7 % 

38.9

 %       

1.8

 pts   

39.9

 % 

37.7

 %       

2.2

 pts 

Bell Wireless 

 460   456     4   0.9 %    921   867     54   6.2 % 

Margin 

 36.1 % 

37.9

 %       

(1.8

 ) pts   

36.4

 % 

36.9

 %       

(0.5

 ) pts 

Bell Media 

 123   -     123   n.m.     123   -     123   n.m.  

Margin 

 23.3 %  n.m.         n.m.     23.3 %  n.m.         n.m.  

Total Bell 

 1,654   1,501     153   10.2 %    3,159   2,916     243   8.3 % 

Margin 

37.9

 % 

39.1

 %       

(1.2

 ) pts   

38.3

 % 

37.9

 %       

0.4

 pts 

Bell Aliant 

 332   342     (10 )  (2.9 %)    660   680     (20 )  (2.9 %) 

Margin 

48.0

 % 

48.9

 %       

(0.9

 ) pts   

48.0

 % 

49.0

 %       

(1.0

 ) pts 

Total BCE Inc. 

 1,986   1,843     143   7.8 %    3,819   3,596     223   6.2 % 

Margin 

40.1

 % 

41.5

 %       

(1.4

 ) pts   

40.5

 % 

40.5

 %       

0.0

 pts 

Capital expenditures 

                                      

Bell Wireline 

 450   464     14   3.0 %    852   852     -   0.0 % 

Capital Intensity (6) 

17.1

 % 

17.3

 %       

0.2

 pts   

16.1

 % 

15.7

 %       

(0.4

 ) pts 

Bell Wireless 

 168   84     (84 )  (100.0 %)    281   137     (144 )  n.m.  

Capital Intensity 

13.2

 % 

7.0

 %       

(6.2

 ) pts   

11.1

 % 

5.8

 %       

(5.3

 ) pts 

Bell Media 

 27   -     (27 )  n.m.     27   -     (27 )  n.m.  

Capital Intensity 

5.1

 %  n.m.         n.m.    

5.1

 %  n.m.         n.m.  

Total Bell 

 645   548     (97 )  (17.7 %)    1,160   989     (171 )  (17.3 %) 

Capital Intensity 

14.8

 % 

14.3

 %       

(0.5

 ) pts   

14.1

 % 

12.9

 %       

(1.2

 ) pts 

Bell Aliant 

 155   124     (31 )  (25.0 %)    274   218     (56 )  (25.7 %) 

Capital Intensity 

22.4

 % 

17.7

 %       

(4.7

 ) pts    19.9 %  15.7 %       

(4.2

 ) pts 

Total BCE Inc. 

 800   672     (128 )  (19.0 %)    1,434   1,207     (227 )  (18.8 %) 

Capital Intensity 

16.1

 % 

15.1

 %       

(1.0

 ) pts   

15.2

 % 

13.6

 %       

(1.6

 ) pts 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 4

 


BCE Inc.
Segmented Data - Historical Trend

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 YTD
2011		     Q2 11   Q1 11     Total
2010		     Q4 10   Q3 10   Q2 10   Q1 10  
                                       

Revenues 

                                      

Bell Wireline 

 5,302     2,630   2,672     10,948     2,822   2,694   2,685   2,747  

Bell Wireless 

 2,527     1,276   1,251     4,906     1,289   1,268   1,203   1,146  

Bell Media 

 529     529   -     -     -   -   -   -  

Inter-segment eliminations 

 (114 )    (73 )  (41 )    (185 )    (46 )  (46 )  (45 )  (48 ) 

Total Bell 

 8,244     4,362   3,882     15,669     4,065   3,916   3,843   3,845  

Bell Aliant 

 1,374     692   682     2,808     716   703   700   689  

Inter-segment eliminations 

 (197 )    (99 )  (98 )    (408 )    (102 )  (102 )  (103 )  (101 ) 

Total BCE Inc. 

 9,421     4,955   4,466     18,069     4,679   4,517   4,440   4,433  
                                       

Operating costs 

                                      

Bell Wireline 

 (3,187 )    (1,559 )  (1,628 )    (6,854 )    (1,803 )  (1,668 )  (1,640 )  (1,743 ) 

Bell Wireless 

 (1,606 )    (816 )  (790 )    (3,188 )    (905 )  (801 )  (747 )  (735 ) 

Bell Media 

 (406 )    (406 )  -     -     -   -   -   -  

Inter-segment eliminations 

 114     73   41     185     46   46   45   48  

Total Bell 

 (5,085 )    (2,708 )  (2,377 )    (9,857 )    (2,662 )  (2,423 )  (2,342 )  (2,430 ) 

Bell Aliant 

 (714 )    (360 )  (354 )    (1,435 )    (371 )  (355 )  (358 )  (351 ) 

Inter-segment eliminations 

 197     99   98     408     102   102   103   101  

Total BCE Inc. 

 (5,602 )    (2,969 )  (2,633 )    (10,884 )    (2,931 )  (2,676 )  (2,597 )  (2,680 ) 
                                       

EBITDA 

                                      

Bell Wireline 

 2,115     1,071   1,044     4,094     1,019   1,026   1,045   1,004  

Margin 

39.9

 %   

40.7

 % 

39.1

 %   

37.4

 %   

36.1

 % 

38.1

 % 

38.9

 % 

36.5

 % 

Bell Wireless 

 921     460   461     1,718     384   467   456   411  

Margin 

36.4

 %   

36.1

 % 

36.9

 %   

35.0

 %   

29.8

 % 

36.8

 % 

37.9

 % 

35.9

 % 

Bell Media 

 123     123   -     -     -   -   -   -  

Margin 

23.3

 %   

23.3

 %  n.m.     n.m.     n.m.   n.m.   n.m.   n.m.  

Total Bell 

 3,159     1,654   1,505     5,812     1,403   1,493   1,501   1,415  

Margin 

38.3

 %   

37.9

 % 

38.8

 %   

37.1

 %   

34.5

 % 

38.1

 % 

39.1

 % 

36.8

 % 

Bell Aliant 

 660     332   328     1,373     345   348   342   338  

Margin 

48.0

 %   

48.0

 % 

48.1

 %   

48.9

 %   

48.2

 % 

49.5

 % 

48.9

 % 

49.1

 % 

Total BCE Inc. 

 3,819     1,986   1,833     7,185     1,748   1,841   1,843   1,753  

Margin 

40.5

 %   

40.1

 % 

41.0

 %   

39.8

 %   

37.4

 % 

40.8

 % 

41.5

 % 

39.5

 % 

Capital expenditures 

                                      

Bell Wireline 

 852     450   402     2,019     646   521   464   388  

Capital Intensity 

16.1

 %   

17.1

 % 

15.0

 %   

18.4

 %   

22.9

 % 

19.3

 % 

17.3

 % 

14.1

 % 

Bell Wireless 

 281     168   113     485     225   123   84   53  

Capital Intensity 

11.1

 %   

13.2

 % 

9.0

 %   

9.9

 %   

17.5

 % 

9.7

 % 

7.0

 % 

4.6

 % 

Bell Media 

 27     27   -     -     -   -   -   -  

Capital Intensity 

5.1

 %   

5.1

 %  n.m.     n.m.     n.m.   n.m.   n.m.   n.m.  

Total Bell 

 1,160     645   515     2,504     871   644   548   441  

Capital Intensity 

14.1

 %   

14.8

 % 

13.3

 %   

16.0

 %   

21.4

 % 

16.4

 % 

14.3

 % 

11.5

 % 

Bell Aliant 

 274     155   119     494     163   113   124   94  

Capital Intensity 

19.9

 %   

22.4

 % 

17.4

 %   

17.6

 %   

22.8

 % 

16.1

 % 

17.7

 % 

13.6

 % 

Total BCE Inc. 

 1,434     800   634     2,998     1,034   757   672   535  

Capital Intensity 

15.2

 %   

16.1

 % 

14.2

 %   

16.6

 %   

22.1

 % 

16.8

 % 

15.1

 % 

12.1

 % 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 5

 


Bell Wireline (2)

  Q2   Q2           YTD   YTD        

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 2011   2010     % change     2011   2010     % change  

Bell Wireline 

                              

Local & access 

 726   758     (4.2 %)    1,455   1,520     (4.3 %) 

Long distance 

 227   231     (1.7 %)    461   467     (1.3 %) 

Data 

 933   963     (3.1 %)    1,888   1,978     (4.6 %) 

Video 

 460   434     6.0 %    920   862     6.7 % 

Equipment & other 

 208   220     (5.5 %)    427   447     (4.5 %) 

Total external revenues 

 2,554   2,606     (2.0 %)    5,151   5,274     (2.3 %) 

Inter-segment revenues 

 76   79     (3.8 %)    151   158     (4.4 %) 

Total Bell Wireline operating revenue 

 2,630   2,685     (2.0 %)    5,302   5,432     (2.4 %) 

Operating costs 

 (1,559 )  (1,640 )    4.9 %    (3,187 )  (3,383 )    5.8 % 

EBITDA 

 1,071   1,045     2.5 %    2,115   2,049     3.2 % 

EBITDA Margin 

40.7

 % 

38.9

 %   

1.8

 pts   

39.9

 %  37.7 %   

2.2

 pts 
                               

Capital expenditures 

 450   464     3.0 %    852   852     -  

Capital intensity 

 17.1 %  17.3 %    0.2 pts   

16.1

 % 

15.7

 %   

0.4

 pts 
                               

Local 

                              

Network access services (NAS) 

                              

Residential 

 3,461,121   3,713,920     (6.8 %)    3,461,121   3,713,920     (6.8 %) 

Business 

 2,854,844   2,918,126     (2.2 %)    2,854,844   2,918,126     (2.2 %) 

Total 

 6,315,965   6,632,046     (4.8 %)    6,315,965   6,632,046     (4.8 %) 

Network access service net (losses)/activations 

                              

Residential 

 (83,479 )  (96,992 )    13.9 %    (147,766 )  (172,610 )    14.4 % 

Business 

 (17,018 )  (32,155 )    47.1 %    (11,974 )  (56,366 )    78.8 % 

Total 

 (100,497 )  (129,147 )    22.2 %    (159,740 )  (228,976 )    30.2 % 

Internet 

                              

High Speed Internet net activations 

 1,275   (3,899 )    n.m.     14,436   6,568     n.m.  

High Speed Internet subscribers EOP 

 2,111,762   2,063,559     2.3 %    2,111,762   2,063,559     2.3 % 

Video 

                              

Net subscriber activations 

 6,072   9,775     (37.9 %)    13,735   29,664     (53.7 %) 

Total subscribers EOP 

 2,033,833   1,978,541     2.8 %    2,033,833   1,978,541     2.8 % 

ARPU (7) ($/month) 

 76.22   73.43     3.8 %    75.75   73.01     3.8 % 

Churn (8) (%) (average per month) 

 1.7 %  1.3 %    (0.4 ) pts    1.5 %  1.2 %   

(0.3

 ) pts 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 6

 


Bell Wireline - Historical Trend

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 YTD
2011		     Q2 11   Q1 11   Total
2010		     Q4 10   Q3 10   Q2 10   Q1 10  

Bell Wireline 

                                    

Local & access 

 1,455     726   729   3,012     733   759   758   762  

Long distance 

 461     227   234   923     232   224   231   236  

Data 

 1,888     933   955   3,985     1,035   972   963   1,015  

Video 

 920     460   460   1,749     450   437   434   428  

Equipment & other 

 427     208   219   962     292   223   220   227  

Total external revenues 

 5,151     2,554   2,597   10,631     2,742   2,615   2,606   2,668  

Inter-segment revenues 

 151     76   75   317     80   79   79   79  

Total Bell Wireline operating revenue 

 5,302     2,630   2,672   10,948     2,822   2,694   2,685   2,747  

Operating costs 

 (3,187 )    (1,559 )  (1,628 )  (6,854 )    (1,803 )  (1,668 )  (1,640 )  (1,743 ) 

EBITDA 

 2,115     1,071   1,044   4,094     1,019   1,026   1,045   1,004  

EBITDA Margin 

39.9

 %   

40.7

 % 

39.1

 % 

37.4

 %   

36.1

 % 

38.1

 % 

38.9

 % 

36.5

 % 
                                     

Capital expenditures 

 852     450   402   2,019     646   521   464   388  

Capital intensity 

16.1

 %   

17.1

 %  15.0 %  18.4 %    22.9 %  19.3 %  17.3 %  14.1 % 

Local 

                                    

Network access services (NAS) 

                                    

Residential 

 3,461,121     3,461,121   3,544,600   3,608,887     3,608,887   3,645,437   3,713,920   3,810,912  

Business 

 2,854,844     2,854,844   2,871,862   2,866,818     2,866,818   2,894,440   2,918,126   2,950,281  

Total 

 6,315,965     6,315,965   6,416,462   6,475,705     6,475,705   6,539,877   6,632,046   6,761,193  

Network access service net (losses)/activations 

                                    

Residential 

 (147,766 )    (83,479 )  (64,287 )  (277,643 )    (36,550 )  (68,483 )  (96,992 )  (75,618 ) 

Business 

 (11,974 )    (17,018 )  5,044   (107,674 )    (27,622 )  (23,686 )  (32,155 )  (24,211 ) 

Total 

 (159,740 )    (100,497 )  (59,243 )  (385,317 )    (64,172 )  (92,169 )  (129,147 )  (99,829 ) 

Internet 

                                    

High Speed Internet net activations 

 14,436     1,275   13,161   40,335     12,099   21,668   (3,899 )  10,467  

High Speed Internet subscribers EOP 

 2,111,762     2,111,762   2,110,487   2,097,326     2,097,326   2,085,227   2,063,559   2,067,458  

Video 

                                    

Net subscriber activations 

 13,735     6,072   7,663   71,221     23,019   18,538   9,775   19,889  

Total subscribers EOP 

 2,033,833     2,033,833   2,027,761   2,020,098     2,020,098   1,997,079   1,978,541   1,968,766  

ARPU ($/month) 

 75.75     76.22   75.76   73.49     74.79   73.34   73.43   72.60  

Churn (%) (average per month) 

 1.5 %    1.7 %  1.4 %  1.4 %    1.5 %  1.6 %  1.3 %  1.1 % 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 7

 


Bell Wireless (2)

  Q2   Q2           YTD   YTD        

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 2011   2010     % change     2011   2010     % change  

Bell Wireless 

                              

Revenue 

                              

Service 

 1,174   1,111     5.7 %    2,319   2,164     7.2 % 

Product 

 92   84     9.5 %    191   170     12.4 % 

Total external Bell Wireless revenues 

 1,266   1,195     5.9 %    2,510   2,334     7.5 % 

Inter-segment 

 10   8     25.0 %    17   15     13.3 % 

Total Bell Wireless operating revenues 

 1,276   1,203     6.1 %    2,527   2,349     7.6 % 

Operating costs 

 (816 )  (747 )    (9.2 %)    (1,606 )  (1,482 )    (8.4 %) 

EBITDA 

 460   456     0.9 %    921   867     6.2 % 

EBITDA margin (Total revenues) 

36.1

 % 

37.9

 %   

(1.8

 ) pts   

36.4

 % 

36.9

 %   

(0.5

 ) pts 

EBITDA margin (Service revenues) 

39.2

 % 

41.0

 %   

(1.8

 ) pts   

39.7

 % 

40.1

 %   

(0.4

 ) pts 
                               

Capital expenditures 

 168   84     (100.0 %)    281   137     n.m.  

Capital intensity 

 13.2 %  7.0 %    (6.2 ) pts    11.1 %  5.8 %   

(5.3

 ) pts 

Wireless gross activations 

 474,900   480,639     (1.2 %)    898,699   909,473     (1.2 %) 

Postpaid 

 341,645   300,579     13.7 %    641,302   564,891     13.5 % 

Wireless net activations 

 36,507   98,459     (62.9 %)    41,799   154,084     (72.9 %) 

Postpaid 

 94,309   102,754     (8.2 %)    174,957   183,966     (4.9 %) 

Wireless subscribers EOP 

 7,283,847   6,987,386     4.2 %    7,283,847   6,987,386     4.2 % 

Postpaid 

 5,716,326   5,225,196     9.4 %    5,716,326   5,225,196     9.4 % 

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

 52.99   52.12     1.7 %    52.34   51.10     2.4 % 

Prepaid 

 16.88   18.35     (8.0 %)    16.10   17.61     (8.6 %) 

Postpaid 

 63.18   63.66     (0.8 %)    62.85   62.70     0.2 % 

Churn (%) (average per month) 

 2.0 %  1.8 %    (0.2 ) pts    2.0 %  1.8 %   

(0.2

 ) pts 

Prepaid 

 3.7 %  3.4 %    (0.3 ) pts    3.7 %  3.4 %   

(0.3

 ) pts 

Postpaid 

 1.5 %  1.3 %    (0.2 ) pts    1.5 %  1.3 %   

(0.2

 ) pts 

Usage per subscriber (min/month) 

 282   284     (0.7 %)    271   271     -  

Cost of acquisition (COA) (9) ($/sub) (A) 

 400   335     (19.4 %)    384   328     (17.1 %) 
                               

 

(A) In Q1 2011, we changed our methodology for calculating Wireless COA to better align with Canadian industry practice. All prior periods have been restated for comparability.

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 8

 


Bell Wireless - Historical Trend

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 YTD
2011		     Q2 11   Q1 11     Total
2010		     Q4 10   Q3 10   Q2 10   Q1 10  

Bell Wireless 

                                      

Revenue 

                                      

Service 

 2,319     1,174   1,145     4,469     1,148   1,157   1,111   1,053  

Product 

 191     92   99     407     134   103   84   86  

Total external Bell Wireless revenues 

 2,510     1,266   1,244     4,876     1,282   1,260   1,195   1,139  

Inter-segment 

 17     10   7     30     7   8   8   7  

Total Bell Wireless operating revenues 

 2,527     1,276   1,251     4,906     1,289   1,268   1,203   1,146  

Operating costs 

 (1,606 )    (816 )  (790 )    (3,188 )    (905 )  (801 )  (747 )  (735 ) 

EBITDA 

 921     460   461     1,718     384   467   456   411  

EBITDA margin (Total revenues) 

36.4

 %   

36.1

 % 

36.9

 %   

35.0

 %   

29.8

 % 

36.8

 % 

37.9

 % 

35.9

 % 

EBITDA margin (Service revenues) 

39.7

 %   

39.2

 % 

40.3

 %   

38.4

 %   

33.4

 % 

40.4

 % 

41.0

 % 

39.0

 % 
                                       

Capital expenditures 

 281     168   113     485     225   123   84   53  

Capital intensity 

11.1

 %   

13.2

 %  9.0 %    9.9 %    17.5 %  9.7 %  7.0 %  4.6 % 

Wireless gross activations 

 898,699     474,900   423,799     1,999,482     552,714   537,295   480,639   428,834  

Postpaid 

 641,302     341,645   299,657     1,332,086     399,041   368,154   300,579   264,312  

Wireless net activations 

 41,799     36,507   5,292     408,746     116,782   137,880   98,459   55,625  

Postpaid 

 174,957     94,309   80,648     500,139     156,708   159,465   102,754   81,212  

Wireless subscribers EOP 

 7,283,847     7,283,847   7,247,340     7,242,048     7,242,048   7,125,266   6,987,386   6,888,927  

Postpaid 

 5,716,326     5,716,326   5,622,017     5,541,369     5,541,369   5,384,661   5,225,196   5,122,442  

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

 52.34     52.99   51.68     52.03     52.34   53.54   52.12   50.07  

Prepaid 

 16.10     16.88   15.36     17.76     16.96   18.85   18.35   16.87  

Postpaid 

 62.85     63.18   62.51     63.49     63.47   65.04   63.66   61.72  

Churn (%)(average per month) 

 2.0 %    2.0 %  1.9 %    1.9 %    2.0 %  1.9 %  1.8 %  1.8 % 

Prepaid 

 3.7 %    3.7 %  3.7 %    3.5 %    3.6 %  3.4 %  3.4 %  3.4 % 

Postpaid 

 1.5 %    1.5 %  1.4 %    1.4 %    1.5 %  1.4 %  1.3 %  1.2 % 

Usage per subscriber (min/month) 

 271     282   256     274     277   280   284   259  

Cost of acquisition (COA)($/sub) (A) 

 384     400   366     358     411   355   335   321  

 

(A)

In Q1 2011, we changed our methodology for calculating Wireless COA to better align with Canadian industry practice. All prior periods have been restated for comparability.

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 9


BCE Inc.
Net debt and other information

BCE Inc. - Net debt and preferreds 

            
             

At June 30, 2011 

BCE Inc.

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

            
      Bell      
  Bell   Aliant   BCE Inc.  

Debt due within one year 

 1,843   396   2,239  

Long-term debt 

 10,042   2,657   12,699  

Preferred shares - BCE (A) 

 1,385   -   1,385  

Cash and cash equivalents 

 (263 )  (13 )  (276 ) 

Net debt 

 13,007   3,040   16,047  

 

Bell - Net debt and preferreds 

            

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 June 30   March 31   Dec. 31  
  2011   2011   2010  
             

Debt due within one year 

 1,843   2,279   1,766  

Long-term debt 

 10,042   9,189   8,221  

Preferred shares - BCE (A) 

 1,385   1,385   1,385  

Cash and cash equivalents 

 (263 )  (2,147 )  (749 ) 

Net Debt 

 13,007   10,706   10,623  
             
             

Net Debt / Adjusted EBITDA (B) 

 2.06   1.73   1.74  

Adjusted EBITDA (B) / Net interest, excluding interest on employee benefit obligations and interest expense on fund unit liability and including 50% of preferred dividends 

 9.93   10.46   10.67  

 

Bell Media - Proportionate Information   
($ millions of Canadian dollars, except where otherwise indicated) (unaudited) Q2 2011 
   
Proportionate Net Debt  275 
Proportionate EBITDA  103 

 

Cash Flow Information 

                                  

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 Q2
2011		   Q2
2010		   $ change   % change     YTD
2011		   YTD
2010		   $ change   % change  

Free Cash Flow (FCF) 

                                  

Cash from operating activities, excluding acquisition costs paid 

 1,065   1,105   (40 )  (3.6 %)    1,802   2,061   (259 )  (12.6 %) 

Capital expenditures 

 (645 )  (548 )  (97 )  (17.7 %)    (1,160 )  (989 )  (171 )  (17.3 %) 

Dividends paid on preferred shares 

 (28 )  (27 )  (1 )  (3.7 %)    (56 )  (55 )  (1 )  (1.8 %) 

Dividends/distributions paid by subsidiaries to non-controlling interest 

 (12 ) 

-

   (12 ) 

n.m.

     (12 )  -   (12 ) 

n.m.

  

Bell Aliant distributions to BCE 

 47   72   (25 )  (34.7 %)    118   145   (27 )  (18.6 %) 

FCF 

 427   602   (175 )  (29.1 %)    692   1,162   (470 )  (40.4 %) 
                                   

 

Cash Flow Information - Historical Trend 

                                      

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 YTD
2011		     Q2
2011		   Q1
2011		     Total
2010		     Q4
2010		   Q3
2010		   Q2
2010		   Q1
2010		  
                                       

Free Cash Flow (FCF) 

                                      

Cash from operating activities, excluding acquisition costs paid 

 1,802     1,065   737     3,758     295   1,402   1,105   956  

Capital expenditures 

 (1,160 )    (645 )  (515 )    (2,504 )    (871 )  (644 )  (548 )  (441 ) 

Dividends paid on preferred shares 

 (56 )    (28 )  (28 )    (108 )    (28 )  (25 )  (27 )  (28 ) 

Dividends/distributions paid by subsidiaries to non-controlling interest 

 (12 )    (12 )  -     -     -   -   -   -  

Bell Aliant distributions to BCE 

 118     47   71     291     73   73   72   73  

FCF 

 692     427   265     1,437     (531 )  806   602   560  
                                       

 

 

(A)

Net debt includes 50% of preferred shares.
(B)

Adjusted EBITDA is defined as EBITDA including dividends / distributions from Bell Aliant to BCE and is based on trailling 12 months data.

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 10

 


BCE Inc.
Consolidated Statements of Financial Position Data

    
  June 30     March 31     December 31  

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

 2011     2011     2010  
                 

ASSETS 

                

Current assets 

                

Cash 

 27     2,069     129  

Cash equivalents 

 249     103     642  

Trade and other receivables 

 3,211     2,580     2,885  

Current tax receivable 

 87     97     139  

Inventory 

 414     424     431  

Prepaid expenses 

 404     450     224  

Other current assets 

 110     106     205  

Total current assets 

 4,502     5,829     4,655  

Non-current assets 

                

Property, plant and equipment 

 18,330     17,582     17,775  

Intangible assets 

 8,116     6,288     6,201  

Deferred tax assets 

 451     437     501  

Investments in associates and joint ventures 

 308     313     303  

Other non-current assets 

 550     669     652  

Goodwill 

 7,253     5,806     5,806  

Total non-current assets 

 35,008     31,095     31,238  

Total assets 

 39,510     36,924     35,893  

LIABILITIES 

                

Current liabilities 

                

Trade and other payables 

 3,595     3,232     3,815  

Interest payable 

 134     135     143  

Dividends payable 

 414     383     356  

Current tax liabilities 

 139     78     37  

Other current liabilities 

 46     51     33  

Debt due within one year 

 2,239     3,049     2,570  

Total current liabilities 

 6,567     6,928     6,954  

Non-current liabilities 

                

Long-term debt 

 12,699     11,556     10,581  

Fund unit liability 

 -     -     3,060  

Deferred tax liabilities 

 784     579     526  

Employee benefit obligation 

 3,142     2,786     3,302  

Other non-current liabilities 

 1,573     1,280     1,302  

Total non-current liabilities 

 18,198     16,201     18,771  

Total liabilities 

 24,765     23,129     25,725  
                 

Equity 

                

Equity attributable to owners 

                

Preferred shares 

 2,770     2,770     2,770  

Common shares 

 13,568     12,745     12,691  

Contributed surplus 

 2,531     2,536     2,579  

Accumulated other comprehensive (loss) income 

 (43 )    48     66  

Deficit 

 (4,988 )    (4,970 )    (7,952 ) 

Total equity attributable to owners 

 13,838     13,129     10,154  

Non-controlling interest 

 907     666     14  

Total equity 

 14,745     13,795     10,168  

Total liabilities and equity 

 39,510     36,924     35,893  
                 

Number of common shares outstanding 

 777.5     754.1     752.3  

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 11

 


BCE Inc.
Consolidated Cash Flow Data

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

   Q2
2011		       Q2
2010		       $ change       YTD
2011		       YTD
2010		       $ change  
                                               

Net earnings 

   683       630       53       1,265       1,364       (99 ) 

Adjustments to reconcile net earnings to cash flows from operating activities 

                                              

Depreciation and amortization of intangible assets 

   821       778       43       1,611       1,544       67  

Net employee benefit plans cost 

   49       73       (24 )      96       149       (53 ) 

Severance, acquisition and other costs 

   219       15       204       280       47       233  

Net interest expense 

   212       262       (50 )      401       524       (123 ) 

Gains on investments 

   (89 )      (10 )      (79 )      (89 )      (135 )      46  

Income taxes 

   194       172       22       393       375       18  

Contributions to employee pension plans 

   (85 )      (144 )      59       (439 )      (299 )      (140 ) 

Payments under other employee future benefit plans 

   (27 )      (24 )      (3 )      (51 )      (48 )      (3 ) 

Severance and other costs paid 

   (59 )      (49 )      (10 )      (306 )      (143 )      (163 ) 

Acquisition costs paid 

   (31 )      (2 )      (29 )      (35 )      (6 )      (29 ) 

Interest paid 

   (216 )      (305 )      89       (383 )      (555 )      172  

Income taxes paid (net of refunds) 

   (25 )      (36 )      11       (33 )      (60 )      27  

Operating assets and liabilities 

   (265 )      (39 )      (226 )      (595 )      (432 )      (163 ) 

Cash flows from operating activities 

   1,381       1,321       60       2,115       2,325       (210 ) 

Bell Aliant dividends/distributions paid to BCE 

   47       72       (25 )      118       145       (27 ) 

Capital expenditures 

   (800 )      (672 )      (128 )      (1,434 )      (1,207 )      (227 ) 

Cash dividends paid on preferred shares 

   (28 )      (27 )      (1 )      (56 )      (55 )      (1 ) 

Cash dividends/distributions paid by subsidiaries to non-controlling interest 

   (77 )      -       (77 )      (168 )      -       (168 ) 

Acquisition costs paid 

   31       2       29       35       6       29  

Bell Aliant Free Cash Flow 

   (127 )      (94 )      (33 )      82       (52 )      134  

Free Cash Flow (4) 

   427       602       (175 )      692       1,162       (470 ) 

Bell Aliant free cash flow, excluding dividends/distributions paid 

   80       22       58       (200 )      (93 )      (107 ) 

Business acquisitions 

   (680 )      4       (684 )      (680 )      13       (693 ) 

Acquisition costs paid 

   (31 )      (2 )      (29 )      (35 )      (6 )      (29 ) 

Business dispositions 

   -       8       (8 )      2       8       (6 ) 

Increase in investments 

   (2 )      (25 )      23       (4 )      (33 )      29  

Decrease in investments 

   45       123       (78 )      48       133       (85 ) 

Other investing activities 

   (1 )      3       (4 )      3       6       (3 ) 

(Decrease) increase in notes payable and bank advances 

   (656 )      (9 )      (647 )      (130 )      99       (229 ) 

Reduction in trade receivables securitization program 

   (348 )      (19 )      (329 )      (350 )      (19 )      (331 ) 

Issue of long-term debt 

   1,301       -       1,301       2,303       -       2,303  

Repayment of long-term debt 

   (1,739 )      (175 )      (1,564 )      (1,815 )      (231 )      (1,584 ) 

Cash dividends paid on common shares 

   (371 )      (333 )      (38 )      (715 )      (643 )      (72 ) 

Issue of common shares 

   51       12       39       100       13       87  

Repurchase of common shares 

   -       (125 )      125       -       (250 )      250  

Issue of equity securities by subsidiaries to non-controlling interest 

   -       -       -       288       -       288  

Other financing activities 

   28       90       (62 )      (2 )      79       (81 ) 
    (2,323 )      (426 )      (1,897 )      (1,187 )      (924 )      (263 ) 

Net (decrease) increase in cash and cash equivalents 

   (1,896 )      176       (2,072 )      (495 )      238       (733 ) 

Cash and cash equivalents at beginning of period 

   2,172       746       1,426       771       684       87  

Cash and cash equivalents at end of period 

   276       922       (646 )      276       922       (646 ) 
                                               

Other information 

                                              

Cash flow per share (10) 

 $ 0.76     $ 0.98     $ (0.22 )   

$

 0.89     $ 1.71     $ (0.82 ) 

Annualized cash flow yield (11) 

   3.3 %      7.7 %      (4.4 ) pts      3.3 %      7.7 %      (4.4 ) pts 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 12

 


BCE Inc.
Consolidated Cash Flow Data - Historical Trend

($ millions of Canadian dollars, except where otherwise indicated) (unaudited) 

   YTD
2011		       Q2 11     Q1 11       Total
2010		       Q4 10     Q3 10     Q2 10     Q1 10  
                                                       

Net earnings 

   1,265       683     582       2,190       344     482     630     734  

Adjustments to reconcile net earnings to cash flows from operating activities 

                                                      

Depreciation and amortization of intangible assets 

   1,611       821     790       3,125       800     781     778     766  

Net employee benefit plans cost 

   96       49     47       294       73     72     73     76  

Severance, acquisition and other costs 

   280       219     61       262       86     129     15     32  

Net interest expense 

   401       212     189       1,049       265     260     262     262  

Gains on investments 

   (89 )      (89 )    -       (135 )      -     -     (10 )    (125 ) 

Income taxes 

   393       194     199       632       159     98     172     203  

Contributions to employee pension plans 

   (439 )      (85 )    (354 )      (1,315 )      (901 )    (115 )    (144 )    (155 ) 

Payments under other employee future benefit plans 

   (51 )      (27 )    (24 )      (98 )      (25 )    (25 )    (24 )    (24 ) 

Severance and other costs paid 

   (306 )      (59 )    (247 )      (238 )      (60 )    (35 )    (49 )    (94 ) 

Acquisition costs paid 

   (35 )      (31 )    (4 )      (24 )      (12 )    (6 )    (2 )    (4 ) 

Interest paid 

   (383 )      (216 )    (167 )      (1,092 )      (292 )    (245 )    (305 )    (250 ) 

Income taxes paid (net of refunds) 

   (33 )      (25 )    (8 )      (129 )      (54 )    (15 )    (36 )    (24 ) 

Operating assets and liabilities 

   (595 )      (265 )    (330 )      (154 )      108     170     (39 )    (393 ) 

Cash flows from operating activities 

   2,115       1,381     734       4,367       491     1,551     1,321     1,004  

Bell Aliant dividends/distributions paid to BCE 

   118       47     71       291       73     73     72     73  

Capital expenditures 

   (1,434 )      (800 )    (634 )      (2,998 )      (1,034 )    (757 )    (672 )    (535 ) 

Cash dividends paid on preferred shares 

   (56 )      (28 )    (28 )      (108 )      (28 )    (25 )    (27 )    (28 ) 

Cash dividends/distributions paid by subsidiaries to non-controlling interest 

   (168 )      (77 )    (91 )      -       -     -     -     -  

Acquisition costs paid 

   35       31     4       24       12     6     2     4  

Bell Aliant Free Cash Flow 

   82       (127 )    209       (139 )      (45 )    (42 )    (94 )    42  

Free Cash Flow 

   692       427     265       1,437       (531 )    806     602     560  

Bell Aliant free cash flow, excluding dividends/distributions paid 

   (200 )      80     (280 )      (152 )      (28 )    (31 )    22     (115 ) 

Business acquisitions 

   (680 )      (680 )    -       (60 )      (73 )    -     4     9  

Acquisition costs paid 

   (35 )      (31 )    (4 )      (24 )      (12 )    (6 )    (2 )    (4 ) 

Business dispositions 

   2       -     2       8       -     -     8     -  

Increase in investments 

   (4 )      (2 )    (2 )      (44 )      (4 )    (7 )    (25 )    (8 ) 

Decrease in investments 

   48       45     3       139       -     6     123     10  

Other investing activities 

   3       (1 )    4       7       1     -     3     3  

(Decrease) increase in notes payable and bank advances 

   (130 )      (656 )    526       250       104     47     (9 )    108  

(Reduction) increase in trade receivables securitization program 

   (350 )      (348 )    (2 )      (37 )      (22 )    4     (19 )    -  

Issue of long-term debt 

   2,303       1,301     1,002       1,366       1,016     350     -     -  

Repayment of long-term debt 

   (1,815 )      (1,739 )    (76 )      (956 )      (321 )    (404 )    (175 )    (56 ) 

Cash dividends paid on common shares 

   (715 )      (371 )    (344 )      (1,318 )      (346 )    (329 )    (333 )    (310 ) 

Issue of common shares 

   100       51     49       39       11     15     12     1  

Repurchase of common shares 

   -       -     -       (500 )      (125 )    (125 )    (125 )    (125 ) 

Issue of equity securities by subsidiaries to non-controlling interest 

   288       -     288       -       -     -     -     -  

Other financing activities 

   (2 )      28     (30 )      (68 )      (80 )    (67 )    90     (11 ) 
    (1,187 )      (2,323 )    1,136       (1,350 )      121     (547 )    (426 )    (498 ) 

Net (decrease) increase in cash and cash equivalents 

   (495 )      (1,896 )    1,401       87       (410 )    259     176     62  

Cash and cash equivalents at beginning of period 

   771       2,172     771       684       1,181     922     746     684  

Cash and cash equivalents at end of period 

   276       276     2,172       771       771     1,181     922     746  
                                                       

Other information 

                                                      

Cash flow per share 

 $ 0.89     $ 0.76  

$

 0.13    

$ 

 2.29    

$ 

 (0.59 )  

$

 1.17  

$

 0.98  

$

 0.73  

Annualized cash flow yield 

   3.3 %      3.3 %    4.3 %      5.4 %      5.4 %    7.8 %    7.7 %    7.7 % 

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 13

 


Accompanying Notes

(1)

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

We report our results of operations in four segments: Bell Wireline, Bell Wireless, Bell Media and Bell Aliant. Our reporting structure reflects how we manage our business and how we classify our operations for planning and measuring performance.

In the second quarter of 2011, BCE acquired the remaining 85% of CTV Inc. (CTV) common shares that it did not already own. CTV is a media company that holds specialty television, digital media, conventional TV and radio broadcasting assets. CTV is reported as a new segment, Bell Media. As at the acquisition date, we transferred certain assets from our wireline business segment to this new segment.

In the first quarter of 2011, Bell acquired xwave, a division of Bell Aliant, specializing in IT professional services and advanced technology solutions. As a result, we have restated prior period results for Bell Wireline and Bell Aliant to reflect the change of ownership in xwave between Bell and Bell Aliant. Our reportable segments and consolidated results did not change as a result of this restatement.
 
(3)

EBITDA

We define EBITDA as operating revenues less operating costs, as shown in the consolidated income statements. We use EBITDA to evaluate the performance of our businesses as it reflects their ongoing profitability. EBITDA also is used as a component in the determination of short-term incentive compensation for all management employees. EBITDA is referred to as an additional GAAP measure because it is displayed on the face of our income statements.
 
(4)

Non-GAAP Financial Measures

Adjusted net earnings and Adjusted earnings per share (EPS)
 The terms Adjusted net earnings and Adjusted EPS do not have any standardized meaning according to IFRS. They are therefore unlikely to be comparable to similar measures presented by other companies.

We define Adjusted net earnings as net earnings attributable to common shareholders before severance, acquisition and other costs, and net gains/ losses on investments. For 2010, Adjusted net earnings also excludes the fair value adjustments on the fund unit liability and adjusts earnings to reflect the interest on the fund unit liability as non-controlling interest. We define Adjusted EPS as Adjusted net earnings per BCE Inc. common share.

We use Adjusted net earnings and Adjusted EPS, among other measures, to assess the operating performance of our ongoing businesses without the effects of after-tax non-controlling interest, severance, acquisition and other costs, and net gains/losses 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 IFRS financial measures are net earnings attributable to common shareholders and earnings per share.

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 14


Accompanying Notes

 

Free Cash Flow
The term free cash flow does not have any standardized meaning according to IFRS. It is therefore unlikely to be comparable to similar measures presented by other companies.

We define free cash flow as cash flows from operating activities, excluding acquisition costs paid, and dividends/distributions received from Bell Aliant less capital expenditures, preferred share dividends, dividends/distributions paid by subsidiaries to non-controlling interest 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 reinvest in our company. We present free cash flow consistently 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 to value a business and its underlying assets.

The most comparable IFRS financial measure is cash from operating activities.
 
(5)

EBITDA margin is calculated as follows:

EBITDA
Operating revenues
 
(6)

Capital Intensity is calculated as follows:

Capital expenditures
Operating revenues
 
(7)

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.
 
(8)

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.
 
(9)

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.
 
(10)

Cash flow per share is calculated as follows:

Cash flow from operating activities less capital expenditures
Average number of common shares outstanding
 
(11)

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

 

BCE Inc. Supplementary Financial Information – Second Quarter 2011  Page 15