BCE reports third quarter 2013 results

BCE reports third quarter 2013 results


-- BCE net earnings attributable to common shareholders of $343
million; Adjusted net earnings of $584 million, up 7%; Adjusted
earnings per share of $0.75, up 7.1%
-- Strong free cash flow of $747 million, up 8.9%
-- Bell EBITDA up 3.0% with 26.8% EBITDA growth at Bell Media,
supported by the inclusion of Astral, and wireless EBITDA
growth of 11.6%; consolidated EBITDA margin steady at 38.4%
-- Wireless postpaid net activations of 102,714 reflect continued
strong adoption of smartphones, now representing 73% of
postpaid base
-- Total quarterly Residential Wireline net activations (TV,
Internet and local access lines) positive for the first time
since 2005
-- Bell Fibe TV net customer activations of 72,813, 69.4% higher
year over year, as service footprint expands to more than 4
million households; high-speed Internet net activations of
36,638, best quarterly performance in over 6 years; residential
local access line losses improve 30.3%
-- Reconfirming all 2013 BCE and Bell Canada financial targets

This news release contains forward-looking statements. For a description
of the related risk factors and assumptions please see the section
entitled "Caution Concerning Forward-Looking Statements" later in this
release.


MONTREAL, Nov. 7, 2013 /PRNewswire/ - BCE Inc. (TSX, NYSE: BCE),
Canada's largest communications company, today reported BCE and Bell
results for the third quarter (Q3) of 2013.




FINANCIAL HIGHLIGHTS

($ millions except per share amounts) Q3 2013 Q3 2012 % change
(unaudited)

Bell(i)

Operating revenues 4,524 4,393 3.0%

EBITDA 1,739 1,688 3.0%

BCE

Operating revenues 5,099 4,982 2.3%

EBITDA 2,063 2,019 2.2%

Net earnings attributable to common 343 527 (34.9%)
shareholders

EPS 0.44 0.68 (35.3%)

Adjusted EPS 0.75 0.70 7.1%

Cash flows from operating activities 1,730 1,591 8.7%

Free cash flow 747 686 8.9%

(i)Bell includes the Bell Wireless, Bell Wireline and Bell Media
segments.







"Bell's industry-leading investments in new broadband network
infrastructure are driving our TV, wireless, Internet and media growth
services, fuelling a $183 million, or 5.3%, year-over-year revenue
increase in Q3 growth services. Key to Bell's transformation as a
competitive force in Canadian communications, these growth services now
make up 82% of Bell's revenue base, while traditional home phone
service accounts for just 8%," said George Cope, President and CEO of
Bell Canada and BCE. "We've seen exceptional growth in smartphone
adoption and data growth even as we implemented the new federal
wireless code, market-leading results at Bell Media enhanced by the
addition of the Astral team, and our best performance in residential
wireline services since 2005 as the popularity of Bell Fibe TV and
Internet continues to accelerate. Our strategy to deliver the best
communications services the world has to offer to Canadian consumers
and business customers is supporting both Bell's growing success in a
competitive communications marketplace and solid financial
performance."



Bell is committed to achieving a clear goal - to be recognized by
customers as Canada's leading communications company - through the
execution of 6 Strategic Imperatives: Invest in Broadband Networks &
Services, Accelerate Wireless, Leverage Wireline Momentum, Expand Media
Leadership, Improve Customer Service, and Achieve a Competitive Cost
Structure.



"Our third-quarter financial results were very solid across all Bell
operating segments with excellent double-digit wireless and media
EBITDA growth driving strong growth in adjusted earnings and free cash
flow. We also continued to leverage our advanced broadband networks and
services to deliver healthy wireless and residential wireline net
customer activations, which provides the foundation for sustained
financial performance going forward," said Siim Vanaselja, Chief
Financial Officer for Bell and BCE. "With an outlook for continued
strong wireless profitability, an improving wireline financial profile
and a significant contribution from Astral to our Bell Media results,
we are on track with our 2013 financial plan and reconfirm today all
our Bell and BCE guidance targets for the year."



Additionally, the funded status of Bell Canada's defined benefit pension
plan has improved significantly since the beginning of the year,
reflecting higher interest rates in 2013. At the end of Q3 2013, Bell's
defined benefit pension plan solvency ratio was over 90%. The improved
solvency position of Bell Canada's pension plan improves Bell's longer
term financial flexibility through reduced future pension funding
requirements.


BCE RESULTS

BCE's net earnings attributable to common shareholders were $343 million
in Q3 2013, or $0.44 per common share, compared to $527 million, or
$0.68 per common share, in Q3 2012. The year-over-year decrease was due
to the CRTC tangible benefits obligation of $230 million that Bell was
ordered to pay as part of the acquisition of Astral Media Inc.
(Astral). Adjusted earnings per share (EPS)((1) )were $0.75 per common share, up 7.1% from last year, reflecting the
flow-through of higher EBITDA from strong year-over-year growth at Bell
Wireless and Bell Media.



BCE's cash flows from operating activities were $1,730 million in Q3, up
$139 million over last year. Free cash flow((2)) available to BCE's common shareholders increased $61 million, or 8.9%,
to $747 million, driven mainly by higher EBITDA((3)) and an increase in working capital.



At the end of Q3, BCE (including Bell and Bell Aliant) served a total of
7,951,182 wireless subscribers, up 3.0% from Q3 2012; total TV
subscribers of 2,438,100 (including 582,393 IPTV customers, reflecting
the addition of 87,355 net new IPTV customers in Q3 2013), a 7.1%
increase; total high-speed Internet subscribers of 3,102,627, up 2.7%;
and total NAS lines of 7,730,283, a decrease of 6.9%.


BELL RESULTS

Bell operating revenues in Q3 2013 grew 3.0% to $4,524 million, with the
inclusion of Astral contributing to Bell Media revenue growth of 21.6%.
Wireless revenue growth of 4.1%, higher TV and Internet service
revenues, growth in IP connectivity and business service solutions
revenue, and greater business data product sales also contributed to
consolidated Bell revenue growth this quarter.



Bell EBITDA increased 3.0% in Q3, driven by 26.8% growth at Bell Media
and 11.6% growth in Wireless EBITDA. This was moderated by a 5.6%
decline in Wireline EBITDA that reflected recognition in Q3 2012 of a
non-recurring gain on the phase-out of post-employment benefits for
certain employees and a reduction in amounts payable to the CRTC
related to the Local Programming Improvement Fund (LPIF), which
collectively totalled $29 million. Excluding these two items, Bell
Wireline EBITDA decreased 2.7% this quarter. Bell consolidated EBITDA
margin remained unchanged at 38.4% due to the flow-through of higher
wireless ARPU (average revenue per unit), a lower volume of wireless
postpaid activations and customer upgrades compared to last year,
diminishing wireline voice erosion, and stabilizing business markets
performance.


BELL OPERATING RESULTS BY SEGMENT

Bell operating performance in the third quarter of 2013 was highlighted
by healthy revenue and EBITDA growth with a steady margin year over
year. We continued to successfully leverage our advanced broadband
networks and services to gain considerable new postpaid wireless
customers, a record number of new Fibe TV subscribers, significantly
more high-speed Internet customers, as well as lower churn and higher
ARPU across all our residential wireline and wireless services. With
the contribution of Astral and healthy organic growth in advertising
revenue, Bell Media delivered a significant contribution to
consolidated Bell EBITDA growth this quarter.



Bell invested $742 million in new capital in Q3 2013, a 7.8%
year-over-year increase, supporting the continued expansion of Fibe TV,
rapid deployment of broadband fibre to more homes and businesses, and
expansion of wireless network capacity to accommodate increasing data
usage.


BELL WIRELESS

Bell Wireless operating revenues increased 4.1% to $1,493 million in Q3
2013, compared to $1,434 million in Q3 2012. Service revenues were up
5.0% to $1,372 million, driven by postpaid subscriber growth and higher
blended ARPU. Wireless data revenue increased 18.4% on increased
adoption of smartphones and use of wireless Internet and data services
such as Mobile TV.



Bell Wireless EBITDA increased 11.6% in Q3 2013, driven by higher ARPU,
fewer postpaid gross activations and customer upgrades year over year,
and overall cost discipline. This contributed to a strong 2.7
percentage-point improvement in service margin to 45.0% from 42.3% in
Q3 2012, our best third-quarter performance in 4 years:



-- Postpaid net additions in Q3 were 102,714. This reflected a
10.6% decrease in postpaid gross activations attributable to
fewer promotional offers, reduced handset discounts, new 2-year
rate plan pricing resulting from the federal Wireless Code of
Conduct, and reduced availability of some new smartphone
models. Prepaid net customer losses improved 29.3% to 13,255
this quarter, due to fewer customer deactivations.

-- Smartphone users represented 73% of total postpaid subscribers
at the end of the quarter, compared to 60% a year earlier. Bell
Wireless postpaid customers totalled 6,683,646 at the end of
Q3, an increase of 6.4% over last year, while total Bell
Wireless customers grew 3.0% to 7,805,100.

-- Postpaid and prepaid customer churn remained unchanged at 1.2%
and 3.3%, respectively. Blended wireless churn improved 10
basis points in Q3 2013 to 1.5%, reflecting a higher proportion
of postpaid subscribers in the customer base.

-- Blended ARPU increased 1.7% to $58.30 in the quarter,
representing the fifteenth consecutive quarter of
year-over-year improvement. The increase is due to growing data
usage by the increasing proportion of smartphone users.

-- Cost of acquisition increased 1.5% to $403 per gross
activation, reflecting higher sales commissions paid due to a
greater postpaid smartphone mix.

-- Retention costs as a percentage of service revenue were 9.3%,
compared to 10.1% in Q3 2012, reflecting fewer customer
upgrades compared to last year.

-- Bell continues to offer customers access to Canada's largest 4G
LTE network reaching approximately 77% of the Canadian
population, complemented by 4G HSPA+ coverage to more than 98%
of the population.

-- Bell Mobile TV welcomed its one millionth subscriber during the
quarter. Mobile TV offers on-the-go access to live and
on-demand sports, news, entertainment and children's TV
programming. Additionally, the Bell TV app enables customers to
access 70 more live and on-demand channels on their smartphones
and tablets.

-- Bell continued to bring Canadians the latest mobile technology
with the introduction of new devices including Apple iPhone 5c
and iPhone 5s, BlackBerry Q5, LG G2, Samsung Galaxy Mega and
Galaxy Note 8.0, Sony Xperia SP and Sony Xperia Z, and the
ultra rugged, push to talk Sonim 5560 IS. In addition, the
Apple iPad and iPad mini are now available directly from Bell.

-- In September, Bell reduced the prices of its most popular
consumer wireless rate plans for United States mobile data,
voice and text roaming by 50%, and in October announced
significant reductions in mobile data, voice and text roaming
rates for Bermuda and most Caribbean islands. Bell is committed
to working with its global telecom partners to reduce consumer
roaming costs further by renegotiating its agreements with
international telecom suppliers that enable Bell mobile
customers to use their phones in more than 200 countries.

-- The Société de transport de Montréal (STM), Bell and 3 other
Canadian wireless providers announced in September that they
are working together to launch a new underground network in the
Montréal metro. The project design phase is now under way and
installation is expected to begin this year. The estimated $50
million cost of deployment will be shared equally by the 4
participating wireless companies.

BELL WIRELINE

The pace of Bell Wireline's revenue decline remained stable compared to
the previous quarter, decreasing a modest 0.9% to $2,482 million, as
higher TV and Internet service revenues, stronger business IP
connectivity and service solutions growth, and increased data product
sales to large enterprise customers, largely offset the decline in
voice revenues. The rate of decline in voice revenues improved for a
fourth consecutive quarter. The slower pace of voice erosion was due to
fewer NAS line losses compared to Q3 2012 and an improved rate of long
distance revenue decline from increased sales of global long-distance
minutes.



Bell Wireline EBITDA decreased 5.6% this quarter, yielding a margin of
37.2% compared to 39.0% in Q3 2012. The decrease in Wireline EBITDA and
margin this quarter was impacted by recognition in Q3 2012 of a
non-recurring gain on the phase-out of post-employment benefits at a
Bell Wireline subsidiary and a reduction in amounts payable to the CRTC
related to the LPIF, which collectively totalled $29 million. Excluding
these two items, Bell Wireline EBITDA decreased 2.7% in Q3 2013,
reflecting approximately $14 million in higher acquisition costs
absorbed from a significantly higher number of new Fibe TV and Internet
customer activations in Q3 2013 compared to last year.



-- Total Bell Residential customer net additions, including
residential NAS, were positive for the first time since 2005,
the year cable telephony service was introduced. Total
residential net additions of approximately 28,000 in Q3 were up
74,000 year over year, supported by record Fibe TV activations
and strong Internet performance that in turn drove higher
residential NAS activations and retention.

-- Bell Fibe TV customer acquisition accelerated this quarter with
the addition of 72,813 net new subscribers, up 69.4% compared
to Q3 2012. The ongoing expansion of our Fibe TV service
footprint and the introduction in May of exclusive wireless
receivers contributed to stronger customer demand for Fibe TV
this quarter. At the end of Q3 2013, Bell Fibe TV subscribers
totalled 419,129, more than double the 200,064 subscribers at
the end of Q3 2012.

-- With the continued expansion of our Fibe TV footprint in
communities across Ontario and Québec (including expansion to
Ottawa in the quarter), Bell's IPTV footprint reached
approximately 4.1 million households, up from 2.9 million
households at the end of Q3 2012.

-- Total Bell Satellite TV net customer losses improved 3.7% this
quarter to 26,128, reflecting fewer customer deactivations.

-- Combined Bell Fibe TV and Satellite TV net additions almost
tripled in the quarter compared to last year, increasing to
46,685 from 15,846. Bell TV's subscriber base totalled
2,242,244 at the end of Q3 2013, representing a 4.9% increase
over the past year.

-- Bell high-speed Internet net subscriber additions were 36,638,
compared to 13,416 in Q3 2012, the best quarterly performance
in more than 6 years. This reflects the pull-through of Bell
Fibe TV customer activations, a higher number of student
activations during the back-to-school period, as well as
increased business customer activations. Bell total high-speed
Internet subscribers reached 2,157,713, up 2.4% since the end
of Q3 2012.

-- Wireline data revenue was up 2.5% to $1,426 million, due mainly
to higher TV and Internet service revenues driven by Fibe
customer growth, higher IP connectivity revenues, increased
spending on professional business services by our mid-sized and
large enterprise customers, and increased data product sales.

-- Residential NAS net losses improved 30.3%, or 25,583, over Q3
2012 to 58,957, reflecting reduced rates of residential NAS
turnover in our Fibe service areas and the success of
promotional offers during the July residential move season in
Québec.

-- Business NAS losses in Q3 2013 increased 15.3%, up 3,786 over
last year to 28,526. This was due to a greater number of
deactivations in our large business segment resulting from
ongoing customer conversion of voice lines to IP-based services
and competitive losses. This was offset by fewer customer
losses in our wholesale and mass and mid-sized business markets
compared to Q3 2012.

-- Total Bell NAS lines at the end of the quarter were 5,338,008,
a 7.5% decline. Consistent with these customer losses, Bell's
local and access revenues declined 8.0% to $613 million, while
long distance revenue declined 4.2% to $184 million.

-- Bell launched its new M2M Management Centre, a secure online
portal offering Canadian businesses a comprehensive suite of
tools to manage connected devices across their operations.
Developed in partnership with Ericsson, it enables Bell M2M
customers to remotely view, administer and control
network-connected devices such as parking and hydro meters,
vending machines, and billboards through a cloud-based
self-serve platform.

BELL MEDIA

Bell Media delivered strong financial and operational performance this
quarter. Higher advertising and subscriber fee revenues reflect the
acquisition of Astral, now part of the Bell Media segment, driving
year-over-year revenue growth of 21.6% to $664 million and EBITDA
growth of 26.8% to $199 million. This contributed to a higher Media
EBITDA margin of 30% (compared to 28.8% in Q3 2012) due to Bell Media's
enhanced mix of specialty and pay TV properties.



-- CTV was Canada's leading network during the summer season in
all key demographics, holding 11 of the top 20 programs
nationally among total viewers. In the key primetime hours,
CTV's average audience was 57% higher than its closest
conventional TV competitor.

-- Bell Media produced The Amazing Race Canada, which debuted with
record results. The program averaged 3.5 million viewers as the
summer's overall #1 program and is the highest-rated Canadian
series on record, highest-rated series premiere ever, and the
highest rated debut season for any show.

-- Bell Media's specialty TV properties reached 84% of all English
specialty and pay TV viewers in the average week during the
third quarter, led by TSN, with higher average audience levels
driven by CFL and NFL football; Discovery, Canada's leading
entertainment specialty channel; Bravo, the fastest-growing
specialty network among younger viewers; The Comedy Network;
and TMN, Canada's leading primetime pay TV station.

-- Bell Media now ranks eighth among all online properties in
Canada, up one rank from the previous quarter, and first among
all Canadian broadcast and video network competitors with a
monthly average of 3.3 million unique visitors, 385 million
page views, and 94 million videos served.

-- On August 26, 2013, Bell announced the sale of two radio
stations in Toronto (CHBM-FM and CFXJ-FM) and three radio
stations in Vancouver (CKZZ-FM, CHHR-FM and CISL-AM) to
Newfoundland Capital Corporation's wholly owned subsidiary
Newcap Inc. for $112 million plus the assumption of certain
liabilities. Bell is divesting these radio stations acquired as
part of the Astral transaction in order to comply with the
CRTC's Common Ownership Policy. The transaction is subject to
approval by the CRTC and the Competition Bureau.

CORPORATE DEVELOPMENTS

Bell was honoured with a Canada Award for Excellence in recognition of
our workplace mental health program. The Silver Award for Mental Health
at Work - the highest ever awarded by Excellence Canada - recognizes
Bell's exemplary commitment to workplace mental health as part of the
Bell Let's Talk initiative, Over the past 3 years, Bell has implemented
programs to help foster a mentally healthy work environment, building
awareness about the stigma of mental illness and equipping team leaders
with the tools and resources to support employees.



BCE Chair Thomas O'Neill, FCA received the Award of Outstanding Merit
from Chartered Professional Accountants of Ontario in September. Under
Mr. O'Neill's leadership, BCE's Board of Directors has also been
recognized twice this year for excellence in corporate governance. BCE
was named the winner of the first-ever award for best overall corporate
governance by the Canadian Society of Corporate Secretaries, while the
Canadian Coalition for Good Governance honoured BCE with its Gavel
Award for exceptional communication with shareholders.



George Cope was named the 2013 Ivey Business Leader for his outstanding
business leadership and his contributions to the community, including
the launch of the Bell Let's Talk mental health initiative and his role
as Chair of United Way Toronto's 2013 campaign. A 1984 graduate of the
HBA program at Western University's Ivey School of Business, Mr. Cope
joins an esteemed roster of past Ivey Business Leader Award recipients
from across corporate Canada who have demonstrated exceptional
leadership in both business and their communities.


BELL ALIANT RESULTS

Bell Aliant (TSX: BA) revenues of $696 million in Q3 2013 were 0.3%
lower than in Q3 2012, as growth in its Internet and TV services were
offset by the continued declines in local and access and long distance
revenues. Bell Aliant's EBITDA was down 2.1% to $324 million this
quarter, as a result of a 1.4% increase in operating costs related to
growth of its FibreOP services. For more information, please visit BellAliant.ca.

COMMON SHARE DIVIDEND

BCE's Board of Directors has declared a quarterly dividend of $0.5825
per common share, payable on January 15, 2014 to shareholders of record
at the close of business on December 16, 2013.


OUTLOOK

BCE's guidance for 2013, as provided on February 7, 2013, which was
updated on August 8, 2013 to reflect the acquisition of Astral, and
reconfirmed on November 7, 2013, is as follows:



____________________________________________________________________
| | February 7 |August 8 |Current Guidance|
| | Guidance |Guidance | Expectation |
|___________________________|_____________|_________|________________|
|Bell (i) | | | |
|___________________________|_____________|_________|________________|
|Revenue Growth | 0% - 2% | 2% - 4% | On track |
|___________________________|_____________|_________|________________|
|EBITDA Growth | 1% - 3% | 3% - 5% | On track |
|___________________________|_____________|_________|________________|
|Capital Intensity | 16% - 17% |No change| On track |
|___________________________|_____________|_________|________________|
|BCE | | | |
|___________________________|_____________|_________|________________|
|Adjusted EPS (ii) |$2.97 - $3.03|No change| On track |
|___________________________|_____________|_________|________________|
|Free Cash Flow growth (iii)| 5% - 9% |No change| On track |
|___________________________|_____________|_________|________________|
|Annual common dividend per | | | |
|share | $2.33 |No change| On track |
|___________________________|_____________|_________|________________|




(i) Bell's 2013 financial guidance for revenue, EBITDA and capital
intensity is exclusive of Bell Aliant.

(ii) We define Adjusted net earnings as net earnings attributable to
common shareholders before severance, acquisition and other
costs, net (gains) losses on investments and premiums on early
redemption of debt. We define Adjusted EPS as Adjusted net
earnings per BCE Inc. common share.

(iii) We define free cash flow as cash flows from operating activities
excluding acquisition costs paid and voluntary pension funding,
plus 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.






CALL WITH FINANCIAL ANALYSTS

BCE will hold a conference call for financial analysts to discuss Q3
2013 results on Thursday, November 7 at 8:00 a.m. (Eastern). Media are
welcome to participate on a listen-only basis. To participate, please
dial toll-free 1-866-226-1792 or (416) 340-2216. A replay will be
available for one week by dialing 1-800-408-3053 or (905) 694-9451 and
entering pass code 3092522#.



A live audio webcast of the conference call will be available on BCE's
website at: BCE Q3-2013 conference_call. The mp3 file will be available for download on this page later in the
day.


NOTES

The information contained in this news release is unaudited.




(1) The terms Adjusted net earnings and Adjusted EPS do not have any
standardized meaning under IFRS. Therefore, they are unlikely to be
comparable to similar measures presented by other companies.
Starting in 2013, our definition of Adjusted net earnings has been
modified to exclude premiums on early redemption of debt to align
with the reporting practices of our peers. We define Adjusted net
earnings as net earnings attributable to common shareholders before
severance, acquisition and other costs, net (gains) losses on
investments, and premiums on early redemption of debt. We define
Adjusted EPS as Adjusted net earnings per BCE common share. We use
Adjusted net earnings and Adjusted EPS, among other measures, to
assess the performance of our businesses without the effects of
severance, acquisition and other costs, net (gains) losses on
investments, and premiums on early redemption of debt, net of tax
and non-controlling interest. 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 EPS. The following table is
a reconciliation of net earnings attributable to common
shareholders and EPS to Adjusted net earnings on a consolidated
basis and per BCE common share (Adjusted EPS), respectively.








($ millions except per share
amounts)

Q3 2013 Q3 2012

TOTAL PER SHARE TOTAL PER SHARE

Net earnings attributable to
common shareholders 343 0.44 527 0.68

Severance, acquisition and other
costs 222 0.29 19 0.02

Net gains on investments (2) (0.01) - -

Premiums on early redemption of
debts 21 0.03 - -

Adjusted net earnings 584 0.75 546 0.70







(2) The term free cash flow does not have any standardized meaning
under IFRS. Therefore, it is unlikely to be comparable to similar
measures presented by other companies. Starting in 2013, our
definition of free cash flow has been modified to exclude voluntary
pension funding because it is a discretionary use of excess cash.
We define free cash flow as cash flows from operating activities,
excluding acquisition costs paid and voluntary pension funding,
plus 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 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 flows from operating activities. The
following table is a reconciliation of cash flows from operating
activities to free cash flow on a consolidated basis.








($ millions)

Q3 2013 Q3 2012

Cash flows from operating activities 1,730 1,591

Bell Aliant dividends/distributions to BCE 48 48

Capital expenditures (880) (832)

Cash dividends paid on preferred shares (38) (27)

Cash dividends/distributions paid by subsidiaries to
non-controlling interest (68) (85)

Acquisition costs paid 32 39

Bell Aliant free cash flow (77) (48)

Free cash flow 747 686







(3) The term EBITDA does not have any standardized meaning under IFRS.
Therefore, it is unlikely to be comparable to similar measures
presented by other companies. We define EBITDA as operating
revenues less operating costs, as shown in BCE's consolidated
income statements. We use EBITDA to evaluate the performance of our
businesses as it reflects their ongoing profitability. 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. EBITDA also is one component in the
determination of short-term incentive compensation for all
management employees. EBITDA has no directly comparable IFRS
financial measure. Alternatively, the following table provides a
reconciliation of BCE net earnings to EBITDA.







($ millions)

Q3 2013 Q3 2012

Net earnings 452 644

Severance, acquisition and other costs 297 25

Depreciation 683 673

Amortization 162 180

Finance costs

Interest expense 242 225

Interest on post-employment benefit obligations 38 33

Other expense (income) 24 8

Income taxes 165 231

EBITDA 2,063 2,019





CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements made in this news release, including, but not limited
to, statements relating to our 2013 financial guidance (including
revenues, EBITDA, Capital Intensity, Adjusted EPS and Free Cash Flow),
our business outlook, objectives, plans and strategic priorities, BCE's
2013 annualized common share dividend, our broadband fibre, IPTV and
wireless networks investment and deployment plans, the proposed
divestiture of certain of Astral's and Bell Media's radio stations, and
other statements that are not historical facts, are forward-looking.
Forward-looking statements are typically identified by the words assumption, goal, guidance, objective, outlook, project, strategy,
target and other similar expressions or future or conditional verbs such as aim, anticipate, believe, could, expect, intend, may, plan, seek, should, strive and will. All such forward-looking statements are made pursuant to the 'safe
harbour' provisions of applicable Canadian securities laws and of the
United States Private Securities Litigation Reform Act of 1995.



Forward-looking statements, by their very nature, are subject to
inherent risks and uncertainties and are based on several assumptions,
both general and specific, which give rise to the possibility that
actual results or events could differ materially from our expectations
expressed in or implied by such forward-looking statements and that our
business outlook, objectives, plans and strategic priorities may not be
achieved. As a result, we cannot guarantee that any forward-looking
statement will materialize and you are cautioned not to place undue
reliance on these forward-looking statements. The forward-looking
statements contained in this news release describe our expectations as
of November 7, 2013 and, accordingly, are subject to change after such
date. Except as may be required by Canadian securities laws, we do not
undertake any obligation to update or revise any forward-looking
statements contained in this news release, whether as a result of new
information, future events or otherwise. Except as otherwise indicated
by BCE, forward-looking statements do not reflect the potential impact
of any non-recurring or other special items or of any dispositions,
monetizations, mergers, acquisitions, other business combinations or
other transactions that may be announced or that may occur after
November 7, 2013. The financial impact of these transactions and
non-recurring and other special items can be complex and depends on the
facts particular to each of them. We therefore cannot describe the
expected impact in a meaningful way or in the same way we present known
risks affecting our business. Forward-looking statements are presented
in this news release for the purpose of assisting investors and others
in understanding certain key elements of our expected 2013 financial
results, as well as our objectives, strategic priorities and business
outlook for 2013, and in obtaining a better understanding of our
anticipated operating environment. Readers are cautioned that such
information may not be appropriate for other purposes.


Material Assumptions

A number of economic, market, operational and financial assumptions were
made by BCE in preparing its forward-looking statements for 2013
contained in this news release, including, but not limited to:


Canadian Economic and Market Assumptions


-- Growth in the Canadian economy of 1.6% in 2013, based on the
Bank of Canada's most recent estimate, a twenty basis point
decrease compared with an earlier estimate of 1.8%;
-- a slow pace of employment growth and new business formation
affecting overall business customer demand;
-- a sustained level of wireline and wireless competition in both
consumer and business markets;
-- higher wireline replacement, due primarily to increasing
wireless and Internet-based technological substitution;
-- increasing wireless industry penetration driven, in particular,
by the accelerated adoption of smartphones, tablets and data
applications, the expansion of LTE service in most urban and
suburban markets, the proliferation of 4G devices, as well as
population growth; and
-- a soft advertising market for Bell Media.

Operational Assumptions Concerning Bell Wireline (Excluding Bell Aliant)


-- Stabilizing residential NAS line erosion rate as our broadband
investments in Fibe TV drive three-product household
penetration, increase our multiple-dwelling units (MDUs) market
share, and generate higher pull-through attach rates for our
residential Internet and Home Phone services, subject to the
risk of more aggressive promotional offers from our cable TV
competitors and increasingly affordable Canada-wide unlimited
wireless plans, which could lead to higher residential NAS line
losses;
-- increased subscriber acquisition at Bell TV to be driven by
increased customer adoption of Fibe TV, as we further extend
our IPTV broadband fibre footprint in areas of Ontario and
Québec, and utilize our ability to seek greater penetration
within the MDU market, and capitalize on our extensive retail
distribution network (which includes The Source), and
leadership position in high-definition (HD) programming;
-- improved subscriber acquisition at Bell Internet through
increased fibre coverage and speeds due to our significant
network capital investment and the implementation of new
technologies to drive greater Fibe TV expansion and Internet
attach rates;
-- gradual improvement in the performance of our Business Markets
unit based on increased business customer spending, new
business formation and higher demand for connectivity and
information and communications technology (ICT) services driven
by a strengthening economy and an improvement in employment
rates, subject to the risk of business customers adopting more
conservative strategies which could result in lower capital
spending requirements and deferral of ICT projects;
-- continued customer migration to IP-based systems, increased
competitive intensity in mass and mid-sized business segments
as cable operators and other telecom competitors continue to
intensify their focus on the business segment and ongoing
competitive re-price pressures in our business and wholesale
markets; and
-- cost savings to be achieved from management workforce attrition
and retirements, call center efficiencies, field service
productivity improvements, further reduction in supplier
contract rates, lower print and mail costs, effective content
cost management and reducing traffic that is not on our own
network.

Operational Assumptions Concerning Bell Wireless (Excluding Bell Aliant)


-- Bell Wireless to benefit from the flow-through of investments
made in 2012 in customer acquisition and retention, along with
continued strength in smartphone activations and data usage;
-- continued aggressive competition in 2013 as competitors attempt
to maintain or gain wireless market share;
-- wireless revenue growth to be underpinned by continued growth
in our subscriber base and ARPU, driven by a higher mix of
smartphone and higher-value postpaid customers, increased
distribution in western Canada, new services, and continued
disciplined price management;
-- Bell Wireless to benefit from ongoing technological
improvements by manufacturers in our handset and device line-up
and from faster data speeds that are allowing our clients to
optimize the use of our services; and
-- the proliferation of more expensive and sophisticated wireless
devices, as well as heightened competitive activity, to exert
pressure on EBITDA, due mainly to increased handset discount
resulting in higher subscriber acquisition and customer
retention costs.

Operational Assumptions Concerning Bell Media


-- The non-recurrence in 2013 of significant events that occurred
in 2012, including the London Summer Olympic Games, the NHL
lockout and retroactive rate increases for specialty
programming services;
-- growth in subscriber revenues to be driven by contracted
market-based rate increases for our specialty sports services;
-- in conventional TV, building and maintaining strategic supply
arrangements for content on four screens, continuing to
successfully acquire high-rated programming and differentiated
content to execute on Bell's multi-screen content strategy,
producing and commissioning high-quality Canadian content,
producing market-leading news and investments in HD
broadcasting;
-- increased costs to secure sports content as we face greater
competition from both new entrants and established competitors,
and as market rates for specialty content generally increase;
-- in our non-sports English and French pay and specialty TV
services, investment in quality programming and production,
marketing and ongoing development of key brand partnership
initiatives with respect to our existing services;
-- pursuant to the Astral acquisition, achievement of cost
reductions by maximizing assets, achieving productivity gains
and pursuing operational efficiencies; and
-- executing in local radio and TV markets to provide listeners
and viewers with quality content, incorporating opportunities
for multi-platform selling.

Financial Assumptions Concerning Bell (Excluding Bell Aliant)


The following constitute Bell's principal financial assumptions for
2013.



-- Bell's total employee benefit plans cost to be approximately
$350 million, based on an estimated accounting discount rate of
4.4% and an expected return on plan assets of 4.4%, comprised
of an estimated above EBITDA employee benefit plans service
cost of approximately $230 million, and an estimated below
EBITDA net employee benefit plans financing cost of
approximately $120 million;
-- total pension plan cash funding to be approximately $350
million;
-- cash taxes to be approximately $350 million, instead of $325
million;
-- net interest expense of approximately $750 million;
-- net interest payments of approximately $720 million; and
-- cash severance and other of approximately $150 million.

Financial Assumptions Concerning BCE


The following constitute BCE's principal financial assumptions for 2013.



-- BCE's total employee benefit plans cost to be approximately
$430 million, including approximately $80 million for Bell
Aliant, comprised of an estimated above EBITDA employee benefit
plans service cost of approximately $290 million, and an
estimated below EBITDA net employee benefit plans financing
cost of approximately $140 million;
-- depreciation and amortization expense of up to approximately
$25 million higher compared to 2012, instead of $50 million
higher due to an increase in the estimate of useful life of
certain assets;
-- net interest expense of approximately $925 million;
-- tax adjustments (per share) of approximately $0.07;
-- an effective tax rate of approximately 26%;
-- non-controlling interest similar to 2012; and
-- an annual common share dividend of $2.33 per share.


The foregoing assumptions, although considered reasonable by BCE on
November 7, 2013, may prove to be inaccurate. Accordingly, our actual
results could differ materially from our expectations as set forth in
this news release.


Material Risks

Important risk factors that could cause our assumptions and estimates to
be inaccurate and actual results or events to differ materially from
those expressed in or implied by our forward-looking statements,
including our 2013 financial guidance, are listed below. The
realization of our forward-looking statements, including our ability to
meet our 2013 financial guidance, essentially depends on our business
performance which, in turn, is subject to many risks. Accordingly,
readers are cautioned that any of the following risks could have a
material adverse effect on our forward-looking statements. These risks
include, but are not limited to:



-- The intensity of competitive activity, and the resulting impact
on our ability to retain existing customers and attract new
ones, as well as on our pricing strategies, ARPU and financial
results;
-- the level of technological substitution contributing to reduced
utilization of traditional wireline voice services and the
increasing number of households that use only wireless
telephone services;
-- the increased adoption by customers of alternative TV services;
-- variability in subscriber acquisition and retention costs based
on subscriber acquisitions, retention volumes, smartphone sales
and handset discount levels;
-- regulatory initiatives or proceedings, litigation, changes in
laws or regulations and tax matters;
-- our failure to maintain network operating performance including
as a result of the significant increase in broadband demand and
in the volume of wireless data driven traffic;
-- events affecting the functionality of, and our ability to
protect, maintain and replace, our networks, equipment,
facilities and other assets;
-- our ability to maintain customer service and our networks
operational in the event of the occurrence of environmental
disasters or epidemics, pandemics and other health risks;
-- our ability to anticipate and respond to technological change,
upgrade our networks and rapidly offer new products and
services;
-- our failure to implement, on a timely basis, or maintain
effective information technology (IT) systems and the
complexity and costs of our IT environment;
-- general economic and financial market conditions, the level of
consumer confidence and spending, and the demand for, and
prices of, our products and services;
-- our ability to implement our strategies and plans in order to
produce the expected benefits, including our ability to
continue to implement our cost reduction initiatives and
contain capital intensity while seeking to improve customer
service;
-- increased contributions to post-employment benefit plans;
-- ineffective management of changes resulting from restructurings
and other corporate initiatives and from the integration of
business units and business acquisitions;
-- the complexity of our product offerings and pricing plans;
-- labour disruptions;
-- employee retention and performance;
-- events affecting the ability of third-party suppliers to
provide to us, and our ability to purchase, essential products
and services;
-- the quality of our network and customer equipment and the
extent to which they may be subject to manufacturing defects;
-- capital and other expenditure levels, financing and debt
requirements and our ability to raise the capital we need to
implement our business plan, including for BCE's dividend
payments and to fund capital and other expenditures and
generally meet our financial obligations;
-- our ability to discontinue certain traditional services as
necessary to improve capital and operating efficiencies;
-- launch and in-orbit risks of satellites used by Bell ExpressVu
Limited Partnership;
-- the theft of our direct-to-home (DTH) satellite TV services;
-- Bell Media's significant dependence on continued demand for
advertising, and the potential adverse effect thereon from
economic conditions, cyclical and seasonal variations and
competitive pressures;
-- the adverse effect of new technology and increasing
fragmentation in Bell Media's TV and radio markets;
-- health concerns about radio frequency emissions from wireless
devices;
-- BCE's dependence on the ability of its subsidiaries, joint
ventures and other companies in which it has an interest to pay
dividends and make other distributions;
-- uncertainty as to whether dividends will be declared by BCE's
board of directors or BCE's dividend policy will be maintained;
-- stock market volatility;
-- our failure to evolve practices and effectively monitor and
control fraudulent activities; and
-- the failure to successfully integrate Astral into Bell Media
and to successfully complete the divestitures required by the
Competition Bureau and the CRTC.


We caution that the foregoing list of risk factors is not exhaustive and
other factors could also adversely affect our results. We encourage
investors to also read BCE's 2012 Annual MD&A dated March 7, 2013
(included in the BCE 2012 Annual Report) as updated in BCE's 2013
First, Second and Third Quarter MD&As, dated May 8, 2013, August 7,
2013 and November 6, 2013 respectively, for additional information with
respect to certain of these and other assumptions and risks, filed by
BCE with the Canadian securities commissions (available at www.sedar.com) and with the U.S. Securities and Exchange Commission (available at www.sec.gov). These documents are also available on BCE's website at www.bce.ca.


ABOUT BCE

BCE is Canada's largest communications company, providing a
comprehensive and innovative suite of broadband communication services
to residential and business customers under the Bell and Bell Aliant
brands. Bell Media is Canada's premier multimedia company with leading
assets in television, radio and digital media, including CTV, Canada's
#1 television network, and the country's most-watched specialty
channels. To learn more, please visit BCE.ca.



The Bell Let's Talk mental health initiative is a national charitable
and awareness program promoting mental health across Canada with the
Bell Let's Talk Day anti-stigma campaign and significant Bell funding
of community care and access, research, and workplace initiatives. To
learn more, please visit Bell.ca/LetsTalk.



For BCE corporate information, please visit BCE.ca. For Bell product and service information, please visit Bell.ca. For Bell Media, please visit BellMedia.ca.


SOURCE Bell Canada

Bell Canada

CONTACT: Media inquiries:
Jean Charles Robillard
Bell Communications
(514) 870-4739
jean_charles.robillard@bell.caInvestor inquiries:
Thane Fotopoulos
BCE Investor Relations
(514) 870-4619
thane.fotopoulos@bell.ca


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