BCE reports 2014 Q4 and full-year results, announces 2015 financial outlook - Common share dividend increased 5.3% to $2.60 per year

BCE reports 2014 Q4 and full-year results, announces 2015 financial outlook - Common share dividend increased 5.3% to $2.60 per year


-- Net earnings attributable to common shareholders of $542
million, up 9.5%; Adjusted net earnings grow 13% to $610
million; Adjusted EPS of $0.72, up 2.9%
-- 10.6% higher Bell Wireless Adjusted EBITDA driven by
accelerated revenue growth of 9.6% on 5.5% increase in blended
ARPU
-- Total BCE wireless postpaid net customer activations in Q4 of
118,120
-- Second consecutive quarter of positive Bell Wireline Adjusted
EBITDA growth, up 2.0%
-- Activated 76,074 net new BCE IPTV customers and 52,010 net new
BCE Internet customers as IPTV fibre footprint expanded to more
than 6 million customer locations
-- Free cash flow grows 23.6% to $833 million; full-year 2014 free
cash flow up 6.7%
-- Bell Media maintains leading TV audience levels and ratings as
TSN and RDS affirm their position as Canada's top specialty
channels
-- 2015 outlook builds on positive operating momentum and
execution of Strategic Imperatives, supporting dividend
increase and significant capital investment

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, Feb. 5, 2015 /PRNewswire/ - BCE Inc. (TSX, NYSE: BCE),
Canada's largest communications company, today reported BCE and Bell
fourth quarter (Q4) and annual 2014 results, announcing its financial
guidance for 2015 and a $0.13 per share hike in the BCE annual common
dividend to $2.60.






FINANCIAL HIGHLIGHTS

($ millions except per
share amounts)
(unaudited) Q4 2014 Q4 2013 % change 2014 2013 % change

Bell (i)

Operating Revenues 4,940 4,813 2.6% 18,734 18,109 3.5%

Adjusted EBITDA(1) 1,730 1,693 2.2% 7,066 6,817 3.7%

BCE

Operating Revenues 5,528 5,382 2.7% 21,042 20,400 3.1%

Adjusted EBITDA 2,022 1,998 1.2% 8,303 8,089 2.6%

Net Earnings
Attributable to Common
Shareholders 542 495 9.5% 2,363 1,975 19.6%

EPS 0.64 0.64 - 2.98 2.55 16.9%

Adjusted EPS(2) 0.72 0.70 2.9% 3.18 2.99 6.4%

Cash flows from
operating activities 1,527 1,838 (16.9%) 6,241 6,476 (3.6%)

Free Cash Flow(3) 833 674 23.6% 2,744 2,571 6.7%

Free Cash Flow per
share(3) 1.01 0.86 17.4% 3.46 3.31 4.5%




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



"The Bell team's hard work in executing our strategy of broadband
network and service investment, efficient operation and improved
customer service is delivering for all our stakeholders - unmatched
network and product innovation for Bell customers; strong value for BCE
shareholders, including the announcement of our latest dividend
increase; and unparalleled investment in the community with another
record Bell Let's Talk Day campaign. These strong Q4 and 2014 results
prove Bell is a bold competitor focused on leading in the growth
services of Canadian communications - wireless, TV, Internet and
media," said George Cope, President and CEO of BCE Inc. and Bell
Canada. "Bell Wireless delivered exceptional customer additions and
strong revenue growth, including a significant quarterly increase in
average revenue per customer as smartphones and data services soar in
popularity. With fast-growing Fibe TV and Internet leading the way, we
recorded our first quarter of growth across each of Wireline revenue,
EBITDA and wireline residential customer net additions since the
introduction of cable telephony a decade ago. Bell Media continued to
set the pace in Canadian multimedia with ongoing leadership in
conventional and specialty TV, radio and now, with CraveTV, the
burgeoning on-demand video streaming marketplace."



Bell is dedicated 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 and
Services, Accelerate Wireless, Leverage Wireline Momentum, Expand Media
Leadership, Improve Customer Service, and Achieve a Competitive Cost
Structure.



"Financially, we enjoyed a successful 2014, comfortably achieving all
our financial guidance targets for the year. Our consistent performance
delivery, year after year, shows the strength of the business model
Bell has built around our 6 Strategic Imperatives. While the
communications industry is marked by intense competition and dynamic
change, we have leveraged our business model to produce results
consistently at or above expectations," said Siim Vanaselja, Chief
Financial Officer for BCE and Bell Canada. "Going into 2015, BCE's
operating momentum and financial foundation is strong. Our financial
targets for this year reflect our expectation for continued strong
Wireless segment profitability, positive growth in Wireline segment
performance, as well as healthy earnings and free cash flow growth from
operations to support our substantial capital investment in strategic
network infrastructure and a higher BCE common share dividend for
2015."


COMMON SHARE DIVIDEND INCREASE

Today's dividend announcement represents BCE's 11(th) increase to its annual common share dividend, representing a 78%
increase, in the past 6 years. The BCE annualized common share dividend
will increase 5.3%, or 13 cents per share, from $2.47 to $2.60
effective with BCE's Q1 2015 dividend payable on April 15, 2015 to
shareholders of record at the close of business on March 16, 2015. With
this increase, BCE will maintain the dividend payout ratio((4)) within its target policy range of 65% to 75% of free cash flow. The
higher dividend for 2015 is fully supported by higher expected free
cash flow generation and a strong business outlook for 2015.


VOLUNTARY PENSION PLAN CONTRIBUTION

BCE made a $350 million voluntary pension plan contribution in December
2014 to align the funded status of Bell Aliant's defined benefit
pension plan with the strong solvency position of the Bell Canada
plans, reducing the amount of BCE's future pension obligations. The
voluntary contribution was funded from cash on hand at the end of 2014.
Accelerating the funding of BCE's future obligation is an efficient use
of cash given the market's general expectation for a sustained low
interest rate environment.


GLENTEL ACQUISITION

On November 28, 2014, BCE announced a definitive agreement to acquire
all of the issued and outstanding shares of GLENTEL Inc., a
Canadian-based dual-carrier, multi-brand mobile products distributor,
for a total consideration of $594 million. GLENTEL shareholder approval
was obtained at a special meeting of shareholders on January 12, 2015,
and court approval was obtained on January 14, 2015. The transaction is
expected to close in Spring 2015, pending Competition Bureau approval.
BCE has entered into an agreement to divest 50% of its ownership
interest in GLENTEL to Rogers Communications Inc. following closing of
the acquisition. Rogers will pay BCE approximately $392 million in
cash, resulting in the reduction of BCE's net cost of acquiring its
retained 50% ownership interest in GLENTEL to $202 million. The Rogers
transaction is expected to close shortly after BCE's acquisition of
GLENTEL, subject to customary closing conditions including regulatory
approvals.


A RECORD BELL LET'S TALK DAY

The signature annual event in Bell's national mental health initiative,
Bell Let's Talk Day on January 28 grew the conversation about mental
health and the promise of a stigma-free Canada like never before. Led
by Bell Let's Talk national spokesperson Clara Hughes, Canadians and
people worldwide sent a record 122,150,772 tweets, texts, calls and
Facebook shares in support of mental health on Bell Let's Talk Day -
and with a Bell donation of 5 cents per interaction, drove
$6,107,538.60 in new funding for mental health programs. With a 58%
increase in tweets compared to 2014, Bell Let's Talk was the #1 Twitter
trend in Canada and #1 worldwide. Based on 4 action pillars -
anti-stigma, care and access, research and workplace leadership - and
providing funding for leading mental health hospitals, research
institutions and community groups in every region, Bell Let's Talk has
now committed $73,623,413.80 to Canadian mental health. To learn more,
please visit Bell.ca/LetsTalk.


RESTART: ANOTHER FIBE TV INNOVATION

The latest enhancement from Bell Fibe TV, the exclusive new "Restart"
feature enables customers to rewind and watch TV shows already in
progress from the beginning. Another Canadian first from Fibe TV
introduced February 2, Restart supports thousands of shows from
networks including CBC, CTV, Global TV, HBO Canada, Super Channel, TSN
and many more. Restart underscores the innovation and choice
represented by next-generation IPTV services like Fibe TV, the result
of Bell's strategic focus on leading investment in Canada's advanced
broadband networks and services. Like the robust wireless subscriber
and data services growth propelled by Bell's rapid deployment of mobile
4G LTE, ongoing fibre expansion is driving strong additions in Bell's
IPTV and Internet growth services. The Fibe TV footprint now covers
more than 5 million households, up from 4.3 million at the end of 2013.
Including Bell Aliant's service area, BCE's total IPTV footprint now
exceeds 6 million customer locations.


BCE RESULTS

BCE operating revenue grew 2.7% to $5,528 million in Q4, reflecting
higher revenues at Bell and Bell Aliant. Adjusted EBITDA was up 1.2% to
$2,022 million, driven by healthy growth at Bell that was partly offset
by a year-over-year decline at Bell Aliant. For the full year 2014, BCE
operating revenue and Adjusted EBITDA increased 3.1% and 2.6%,
respectively.



BCE's Q4 2014 net earnings attributable to common shareholders of $542
million, or $0.64 per share, were 9.5% higher than the $495 million, or
$0.64 per share, reported in Q4 2013. Adjusted net earnings( )increased 13.0% to $610 million, and adjusted earnings per share (EPS)
grew 2.9% to $0.72 from $0.70 last year, driven by higher Adjusted
EBITDA from continued strong wireless profitability and positive
overall wireline growth. Lower non-controlling interest, resulting from
the privatization of Bell Aliant completed on November 1, 2014, also
contributed to higher adjusted net earnings in the quarter.



In Q4 2014, we recorded a net impairment charge of $95 million, mainly
related to Bell Media's conventional TV properties. The impairment
resulted from ongoing softness in the overall Canadian TV advertising
market and higher content costs. This impact was offset largely by
mark-to-market net gains in the quarter on equity derivative contracts
entered into to hedge our share-based compensation liabilities and U.S.
dollar purchases.



For 2014, net earnings attributable to common shareholders were $2,363
million, or $2.98 per share, up 19.6% from $1,975 million, or $2.55 per
share, in 2013. The increase was the result of healthy growth in
Adjusted EBITDA, lower non-controlling interest, and a charge in 2013
for the CRTC tangible benefits obligation that Bell paid as part of its
acquisition of Astral Media, partly offset by the net impairment charge
recorded in Q4 2014. Adjusted net earnings of $2,524 million and
Adjusted EPS of $3.18 were up 8.9% and 6.4%, respectively, compared to
2013. This reflected higher Adjusted EBITDA driven by the increased
contribution of Bell's growth services, lower net pension financing
cost, and mark-to-market gains realized on equity derivatives used as
economic hedges of share-based compensation and U.S. dollar purchases.



BCE's cash flow from operating activities was $1,527 million compared to
$1,838 million in Q4 2013, due to the $350 million voluntary
contribution made to post-employment benefit plans at the end of 2014.
Free cash flow generated in Q4 2014 was $833 million, or 23.6% higher
than last year, driven by higher Adjusted EBITDA and lower capital
expenditures. With the privatization of Bell Aliant completed on
November 1, 2014, BCE's free cash flow in Q4 included 2 months of
contribution from Bell Aliant. For full year 2014, cash flow from
operating activities decreased 3.6% to $6,241 million as a result of
the $350 million voluntary pension contribution, while free cash flow
increased 6.7% to $2,744 million. Free cash flow per share was $1.01
per share in Q4 and $3.46 per share in 2014, representing
year-over-year increases of 17.4% and 4.5%, respectively.



In Q4 2014, BCE (Bell Canada and Bell Aliant) added 177,698 net new
customers from communications growth services (wireless, TV and
Internet): 118,120 postpaid wireless customers, partly offset by the
loss of 34,622 prepaid customers; 42,190 TV subscribers, reflecting the
addition of 76,074 net new IPTV customers; and 52,010 high-speed
Internet customers. Total net NAS line losses improved 31.0% to 93,005.
At the end of 2014, BCE served a total of 8,118,628 wireless customers,
up 2.4% from Q4 2013; total TV subscribers of 2,642,608, up 6.2%
(including 933,547 IPTV customers, an increase of 42%); total
high-speed Internet subscribers of 3,297,026, up 5.1%; and total NAS
lines of 7,130,852, a decrease of 6.1%.


BELL RESULTS

Bell operating revenues grew 2.6% to $4,940 million in Q4 on 2.2% higher
service revenues, reflecting a strong year-over-year increase at Bell
Wireless and positive overall Wireline growth. Product revenues grew
6.8% over Q4 2013, reflecting more wireless device upgrades and
increased business data equipment sales, and contributing to the
year-over-year improvement in total Bell operating revenues. Bell Media
revenues declined 3.9% compared to last year.



Bell Adjusted EBITDA in Q4 was up 2.2% to $1,730 million, driven by
increases of 10.6% at Bell Wireless and 2.0% at Bell Wireline. Overall
growth in the quarter was moderated by a 16.5% decline at Bell Media,
due to higher costs for sports rights and content investments for the
CraveTV on-demand video streaming service. Bell's consolidated EBITDA
margin in Q4 2014 remained essentially unchanged at 35.0% compared to
35.2% in Q4 2013.



For 2014, in line with guidance targets for the year, Bell operating
revenues and EBITDA were up 3.5% and 3.7%, respectively, to $18,734
million and $7,066 million, driven by the increased contribution of
Bell growth services - Wireless, TV, Internet and Media. Total revenues
generated by these growth services grew $814 million in 2014, a 5.5%
increase over the previous year.



Bell invested $932 million in new capital in Q4 2014, bringing total
capital expenditures for the year to $3,142 million, an increase of
4.7% over 2013. These investments support the continued deployment of
broadband fibre to homes and businesses to expand our Fibe TV service
footprint and enable faster Internet speeds; the continuing rollout of
4G LTE mobile service in markets across Canada; higher spending on
network capacity to support increasing Internet bandwidth usage and
mobile data consumption; and enhancements to our customer service
delivery systems.


BELL OPERATING RESULTS BY SEGMENT

Bell Wireless

Wireless operating revenue growth continued to accelerate this quarter,
increasing 9.6% to $1,649 million on 8.1% higher service revenues of
$1,469 million. The growth was driven by an increased mix of postpaid
subscribers in our customer base and higher blended ARPU((4)), fuelled by greater mobile data usage on smartphones and higher average
rate plan pricing. Wireless data revenues grew 26% in the quarter and
now represent approximately half of total Bell Wireless service
revenues. Product revenues were up 24.6% to $167 million as a result of
more activations and upgrades to more premium smartphones compared to
last year.



Bell Wireless Adjusted EBITDA increased 10.6% to $585 million in Q4
2014, delivering a 0.9 percentage-point expansion in service margin to
39.8%. This was achieved even with an approximate $40 million
year-over-year increase in combined subscriber acquisition costs and
retention spending, which contributed to operating cost growth of 9.0%
in the quarter.



For full-year 2014, Bell Wireless operating revenues increased 6.7% to
$6,241 million with service revenues growing 6.4% to $5,705 million and
product revenues up 11.8% to $483 million. Adjusted EBITDA grew 9.6% to
$2,564 million as service margin increased 1.3 percentage points to
44.9%, reflecting the strong service revenue flow-through from an
expanding base of postpaid subscribers and disciplined pricing.



-- Postpaid gross additions totalled 377,735 in Q4, up 2.6% over
last year, reflecting strong holiday period sales, higher
activations in western Canada, and increased tablet sales.
-- Postpaid net additions were 117,378, compared to 119,520 in Q4
2013, bringing the total number of postpaid customers at the
end of 2014 to 6,986,196, an increase of 4.6%. Including
wireless operations at Bell Aliant, total BCE wireless postpaid
net customer activations in Q4 were 118,120.
-- Total Bell Wireless customers grew 2.5% to 7,970,702. Postpaid
customers represented 88% of this total at the end of 2014,
compared to 86% one year earlier. Including Bell Aliant
customers, BCE now serves a total of 8,118,628 wireless
customers, up 2.4% from Q4 2013.
-- The percentage of postpaid subscribers with smartphones
increased to 76% at the end of 2014, compared to 73% at the end
of 2013.
-- Postpaid customer churn(4) in Q4 2014 remained essentially
unchanged at 1.30%, compared to 1.29% last year, despite the
seasonally high level of promotional activity in Q4 2014.
-- Blended ARPU(4) increased 5.5% to $61.12 in Q4, representing
the 20th consecutive quarter of year-over-year improvement.
Growth was driven by accelerating data usage on Bell's
expanding 4G LTE network as the proportion of smartphone users
continued to increase, and the favourable impact of 2-year
contract pricing introduced in 2013 following implementation of
the federal Wireless Code of Conduct. For full-year 2014,
blended ARPU increased 4.9% to $60.07.
-- Cost of acquisition (COA)(4) increased 6.2% this quarter to
$497 per gross addition, due to a higher postpaid mix and sale
of more premium smartphones compared to last year. For
full-year 2014, COA increased 5.2% to $443 per gross addition.
-- Retention spending increased to 13.5% of wireless service
revenues in Q4 2014 from 12.4% last year, reflecting a greater
number of early customer upgrades to high-end devices. In line
with plan, retention spending for full-year 2014 was 11.0% of
wireless service revenues.
-- 4G LTE network coverage increased to 86% of the Canadian
population at the end of Q4 and is expected to grow to more
than 98% by the end of 2015 as Bell intends to roll out LTE to
more small towns, rural locations and Canada's North. 4G LTE is
complemented by 4G HSPA+ coverage currently available to more
than 98% of the population.
-- In January 2015, Bell introduced Travel Data Passes that
provide up to twice the data for customers travelling to more
than 200 countries worldwide. The passes offer 100 MB of data
usage for as little as $30, enabling Bell customers to take
full advantage of their smartphones and data services when
visiting countries such as Mexico, the U.K. or China.

Bell Wireline

Bell Wireline operating revenues increased 1.0% to $2,628 million in Q4
2014, representing the first quarter of positive growth since Q2 of
2010. This was the result of continued robust residential growth,
including positive total net subscriber additions driven by strong
broadband Internet and Fibe TV customer acquisitions in the quarter, a
slower pace of voice revenue decline, and improved year-over-year
Business Markets revenue performance from increased sales of business
service solutions and data equipment.



With an increasing mix of growth services, improved Business Markets
results and tight operating cost control, Bell Wireline Adjusted EBITDA
grew 2.0% to $953 million in Q4, driving a 40 basis point improvement
in margin to 36.3%.



Notably, Q4 2014 represents the first quarter since cable telephony was
launched in 2005 that Bell Wireline generated positive overall revenue
growth together with positive Adjusted EBITDA growth and positive total
residential net subscriber additions.



For full-year 2014, Bell Wireline operating revenues decreased 0.6% to
$10,040 million, while operating costs decreased 0.5% to $6,272
million, resulting in a 0.7% decline in Wireline Adjusted EBITDA to
$3,768 million. Wireline Adjusted EBITDA margin held stable at 37.5%,
compared to 37.6% in 2013, despite the continuing shift from
higher-margin voice revenues towards lower-margin growth services.



-- Total Bell residential customer net activations increased
23,917 to 11,451 in Q4 2014 from a net loss of 12,466 last
year, reflecting strong Internet subscriber growth and Fibe TV
adoption that also drove higher residential NAS activations and
retention. Including residential wireline operations at Bell
Aliant, total BCE residential customer net activations in Q4
were 22,741, up from a net loss of 20,043 last year.
-- Net high-speed Bell Internet customer additions were 34,126 in
Q4 2014, more than double the 15,690 customers added in Q4
2013. The year-over-year increase reflects continued strong
Internet customer attach rates on Fibe TV service bundles and
the higher service speeds and reliability of Bell's growing
broadband fibre network. Including Bell Aliant, total BCE
Internet net customer activations in Q4 were 52,010, up 29,141
over the previous year.
-- Bell Fibe TV added 58,371 net new customers this quarter,
compared to 60,301 last year. Total BCE IPTV net additions in
Q4 2014 were 76,074, up from 75,120 in Q4 2013. At the end of
2014, BCE served 933,547 IPTV subscribers, up 42.0% from the
end of 2013.
-- The Bell Fibe TV footprint reached more than 5 million
households at the end of 2014, compared to approximately 4.3
million at the end of 2013. Including Bell Aliant's FibreOP
service area, BCE's total IPTV footprint now covers 6 million
homes, up from 5.1 million at the end of 2013.
-- Bell had 2,287,489 high-speed Internet customers at the end of
2014, a 4.7% increase over 2013. Including Bell Aliant, BCE has
3,297,026 high-speed Internet subscribers, up 5.1% compared to
last year.
-- Satellite TV net customer losses increased to 33,934 in Q4 2014
from 24,112 last year. This was the result of fewer retail
activations due to aggressive cable TV offers in Bell service
areas where Fibe TV is not available, and lower wholesale
activations reflecting the expanded roll-out of IPTV service by
competing providers in Western and Atlantic Canada.
-- Bell TV's subscriber base (Bell Satellite TV and Fibe TV)
totalled 2,376,885 at the end of 2014, a 4.3% increase over
2013. Including Bell Aliant, BCE now serves 2,642,608 TV
customers, up 6.2%.
-- Wireline data revenues were up 4.0% to $1,573 million in Q4
2014, the result of combined Internet and TV service revenue
growth of 5.1%, growth in IP broadband connectivity and
business service solutions of approximately 3% and 10%,
respectively, and higher data equipment sales to business
customers.
-- Residential NAS net losses in Q4 2014 improved 36.5% to 40,178
from 63,281 in Q4 2013, reflecting the pull-through effect of
Fibe TV service bundles and improved retention in areas where
IPTV service is available. Including Bell Aliant, total BCE
residential NAS net losses in Q4 were 58,870, down 35.7% over
the previous year.
-- Business NAS net losses improved 18.3% in Q4 2014, or 26,527,
compared to 32,478 in Q4 2013, due to fewer customer
deactivations. Including Bell Aliant, total BCE business NAS
net losses in Q4 were 34,135, or 8,988 fewer than Q4 2013.
-- Total NAS access lines at the end of 2014 were 4,893,236, a
6.7% decline compared to the previous year. Including Bell
Aliant, BCE now has total NAS lines of 7,130,852, a decrease of
6.1%.
-- Consistent with the year-over-year reduction in NAS net losses
in Q4 2014, the rate of local and access revenue decline
improved 4.6% to $578 million.
-- Long distance revenues were up 1.2% to $173 million in Q4 2014
on higher year-over-year sales of international long distance
minutes.

Bell Media

Bell Media operating revenues decreased by 3.9% this quarter to $789
million. The decline was due to $20 million in retroactive subscriber
fee and retransmission royalty revenues that did not recur in Q4 2014,
and the loss of revenue services that ceased operations in 2014
(regional hockey feeds and Viewers Choice). Advertising revenues in Q4
2014 increased slightly over last year, attributable to the programming
strength of Bell Media's leading specialty sports services, TSN and
RDS, and growth in specialty news channel audiences, which offset
declines in conventional TV advertising.



Bell Media Adjusted EBITDA decreased 16.5% in Q4 to $192 million from
$230 million last year, the result of higher TV content costs for
sports broadcast rights and the launch of CraveTV, as well as the
flow-through of $20 million in revenues from Q4 2013 that did not recur
in Q4 2014.



For the full year 2014, operating revenues were up 14.9% to $2,937
million and Adjusted EBITDA increased 7.5% to $734 million, reflecting
the incremental contribution to advertising and subscriber revenues in
the first half of the year from the acquisition of Astral Media.



-- CTV remained Canada's leading conventional TV network during
the fall season in all key demographics, holding 14 of the top
20 programs nationally among total viewers and all 4 of the top
4 programs among viewers aged 25 to 54 (The Big Bang Theory,
The Flash, Gotham, and Marvel's Agents of S.H.I.E.L.D). CTV's
fall season audience was up 9%, widening its lead over
conventional TV competitors and producing its highest full-day
average audience level in over a decade.
-- Bell Media's specialty and pay TV properties reached 83% of all
Canadian English specialty and pay TV viewers in the average
week during Q4 2014. In primetime, for the key 25 to 54 age
demographic, viewing was led by TSN and Discovery for sports
and entertainment specialty and The Movie Network (TMN) for pay
TV.
-- Canada's sports leader and the leading specialty TV network in
the country, TSN expanded to 5 national feeds with a deep
portfolio of premium sports programming, broadcasting the 2014
CFL Grey Cup, growing audience levels for NFL football through
its expanded broadcast schedule, and hosting the #1 specialty
program and #1 hockey program of Q4 with its broadcast of World
Junior Hockey.
-- The IIHF World Junior Championship game broke the all-time
audience record in Canadian specialty TV history with 7.1
million viewers.
-- Bell Media maintained its leading position in Québec as its
properties reached an average of 83% of the French-language
population weekly. The Top 5 Specialty channels in Québec for
viewers aged 25 to 54 were RDS, Canal D, Canal Vie, Z and Super
Écran, all Bell Media properties.
-- Bell Media led its Canadian competitors in unique visitors and
video viewers, total page views, visits and videos served with
monthly averages of 16.6 million visitors, 3.5 million viewers,
519 million page views, 127 million visits and 87 million
videos, respectively.
-- Bell Media remained Canada's top radio broadcaster, reaching
17.4 million listeners who spent 84 million hours tuned in each
week during Q4 2014.
-- Bell Media launched Crave TV, its new on-demand TV streaming
service, on December 11, 2014. Offering the largest collection
of premium content in one place with thousands of hours of
programming and approximately 350 unique titles of popular
series and movies, CraveTV is now distributed by Bell TV, Bell
Aliant, Eastlink, Northwestel and TELUS.
-- Bell Media and CBS Corp. announced on January 29, 2015 a
long-term content licensing and trademark agreement for
SHOWTIME in Canada. This exclusive deal will bring the SHOWTIME
brand to Canada for the first time with hundreds of hours of
past, present and future SHOWTIME-owned programming being made
available across all platforms in English and French, including
Bell Media's CraveTV service and its leading pay TV service,
TMN. CraveTV and TMN become Canada's exclusive home of
SHOWTIME-owned first-run programming as well as its entire
catalog of scripted and unscripted series, documentaries,
specials and TV movies.

BELL ALIANT

Bell Aliant revenues increased 1.7% in Q4 2014 to $700 million from $688
million last year, as growth in Internet, TV, other data and wireless
revenues exceeded the declines in local, long distance and other
revenues. Despite higher year-over-year operating revenues, Bell Aliant
Adjusted EBITDA decreased 4.3% this quarter to $292 million from $305
million in Q4 2013, reflecting higher operating costs driven by growth
of its FibreOP services and customers.



Bell Aliant continued to extend its fibre-to-the-home (FTTH) network in
Q4, passing 56,000 additional homes and businesses with FibreOP
services, bringing its total FTTH service footprint to approximately
1,017,000 locations in more than 89 communities throughout Atlantic
Canada, Québec and Ontario.



With the privatization of Bell Aliant completed on November 1, 2014,
Bell Aliant will cease being a reporting operating segment starting
with BCE's Q1 2015 results. Its operating results will be integrated
within Bell's respective Wireline and Wireless segments.


COMMON SHARE DIVIDEND

BCE's Board of Directors declared a quarterly dividend of $0.65 per
common share, payable on April 15, 2015 to shareholders of record at
the close of business on March 16, 2015.


OUTLOOK FOR 2015

BCE's 2015 outlook builds on the positive wireless and wireline momentum
we delivered in 2014 and reflects continued progress in the execution
of our 6 Strategic Imperatives.



All our 2015 financial guidance targets reflect continued healthy
projected Wireless profitability and improving Wireline growth as well
as the privatization of Bell Aliant, with Adjusted EPS and free cash
flow providing a strong and stable foundation for the 5.3% increase in
BCE's common share dividend for 2015.



Our 2014 guidance, 2014 results, and financial guidance targets for 2015
are as follows:





__________________________________________________________________
| | 2014 | 2014 | 2015 |
| | Guidance | Results | Guidance |
|________________|_____________|_________________|_________________|
|BCE | | | |
|________________|_____________|_________________|_________________|
|Revenue growth | | | |
|(i) | 2% - 4% | 3.5% | 1% - 3% |
|________________|_____________|_________________|_________________|
|Adjusted EBITDA | | | |
|growth(i) | 3% - 5% | 3.7% | 2% - 4% |
|________________|_____________|_________________|_________________|
|Capital | | | |
|Intensity(i),(4)| 16% - 17% | 16.8% | approx. 17% |
|________________|_____________|_________________|_________________|
|Adjusted EPS |$3.10 - $3.20| $3.18 | $3.28 - $3.38 |
|________________|_____________|_________________|_________________|
|Free cash flow | | | |
|growth(ii) | 3% - 7% | 6.7% |approx. 8% - 15% |
|________________|_____________|_________________|_________________|
|Annual common | | | |
|dividend per | | | |
|share | $2.47 | $2.47 | $2.60 |
|________________|_____________|_________________|_________________|
|Dividend payout | 65% - 75% | | |
|policy |of free cash | 69% | 65% - 75% |
| | flow |of free cash flow|of free cash flow|
|________________|_____________|_________________|_________________|




(i) 2014 results and financial guidance for revenue growth, Adjusted
EBITDA growth and capital intensity are exclusive of Bell Aliant.

(ii) As of November 1, 2014, BCE's free cash flow includes 100% of Bell
Aliant's free cash flow rather than cash dividends received from
Bell Aliant.





CALL WITH FINANCIAL ANALYSTS

BCE will hold a conference call for financial analysts to discuss Q4
2014 results on Thursday, February 5 at 8:00 am (Eastern). Media are
welcome to participate on a listen-only basis. Please dial toll-free
1-800-355-4959 or (416) 340-2218. A replay will be available for one
week by dialing 1-800-408-3053 or (905) 694-9451 and entering pass code
5323218#.



A live audio webcast of the conference call will be available on BCE's
website at: BCE Q4-2014 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) Beginning with Q2 2014, we reference Adjusted EBITDA and Adjusted
EBITDA margin as non-GAAP financial measures. These terms replace
the previously referenced non-GAAP financial measures EBITDA and
EBITDA margin. Our definition of Adjusted EBITDA and Adjusted
EBITDA margin are unchanged from our former definition of EBITDA
and EBITDA margin respectively. Accordingly, this change in
terminology has no impact on our reported financial results for
prior periods. The terms Adjusted EBITDA and Adjusted EBITDA margin
do not have any standardized meaning under IFRS. Therefore, they
are unlikely to be comparable to similar measures presented by
other issuers. We define Adjusted EBITDA as operating revenues less
operating costs, as shown in BCE's consolidated income statements.
Adjusted EBITDA for BCE's segments is the same as segment profit as
reported in BCE's consolidated financial statements. We define
Adjusted EBITDA margin as Adjusted EBITDA divided by operating
revenues. We use Adjusted EBITDA and Adjusted EBITDA margin to
evaluate the performance of our businesses as they reflect their
ongoing profitability. We believe that certain investors and
analysts use Adjusted 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.
We believe that certain investors and analysts also use Adjusted
EBITDA and Adjusted EBITDA margin to evaluate the performance of
our businesses. Adjusted EBITDA also is one component in the
determination of short-term incentive compensation for all
management employees. Adjusted EBITDA and Adjusted EBITDA margin
have no directly comparable IFRS financial measure. Alternatively,
the following table provides a reconciliation of net earnings
to Adjusted EBITDA.









($ millions)

Q4 2014 Q4 2013 2014 2013

Net earnings 594 593 2,718 2,388

Severance, acquisition and other costs 58 48 216 406

Depreciation 734 695 2,880 2,734

Amortization 118 160 572 646

Finance costs

Interest expense 238 240 929 931

Interest on post-employment benefits
obligations 25 37 101 150

Other expense (income) 34 (1) (42) 6

Income taxes 221 226 929 828

Adjusted EBITDA 2,022 1,998 8,303 8,089

BCE Operating Revenues 5,528 5,382 21,042 20,400

Adjusted EBITDA Margin 36.6% 37.1% 39.5% 39.7%









(2) 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 issuers. We
define Adjusted net earnings as net earnings attributable to common
shareholders before severance, acquisition and other costs, net
(gains) losses on investments, and early debt redemption costs. We
define Adjusted EPS as Adjusted net earnings per BCE
common share.We use Adjusted net earnings and Adjusted EPS, and we
believe that certain investors and analysts use these measures,
among other ones, to assess the performance of our businesses
without the effects of severance, acquisition and other costs, net
(gains) losses on investments, and early debt redemption costs, net
of tax and NCI. 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)

Q4 2014 Q4 2013 2014 2013

Per Per Per Per
Total share Total share Total share Total share

Net earnings
attributable to common
shareholders 542 0.64 495 0.64 2,363 2.98 1,975 2.55

Severance, acquisition
and other costs 42 0.04 33 0.04 148 0.18 299 0.38

Net losses (gains) on
investments 8 0.01 12 0.02 (8) (0.01) 7 0.01

Premiums on early
redemption of debt 18 0.03 - - 21 0.03 36 0.05

Adjusted net earnings 610 0.72 540 0.70 2,524 3.18 2,317 2.99









(3) The terms free cash flow and free cash flow per share do not have
any standardized meaning under IFRS. Therefore, they are unlikely
to be comparable to similar measures presented by other issuers. As
of November 1, 2014, BCE's free cash flow includes 100% of Bell
Aliant's free cash flow rather than cash dividends received from
Bell Aliant. We define free cash flow as cash flows from operating
activities, excluding acquisition costs paid and voluntary pension
funding, less capital expenditures, preferred share dividends and
dividends paid by subsidiaries to NCI.



Prior to November 1, 2014, free cash flow was defined as cash flows
from operating activities, excluding acquisition costs paid and
voluntary pension funding, plus dividends received from
Bell Aliant, less capital expenditures, preferred share dividends,
dividends paid by subsidiaries to NCI and Bell Aliant free
cash flow.



We define free cash flow per share as free cash flow divided by the
average number of common shares outstanding.



We consider free cash flow and free cash flow per share to be
important indicators of the financial strength and performance of
our businesses because they show how much cash is available to pay
dividends, 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. We believe that certain
investors and analysts also use free cash flow and free cash flow
per share to evaluate the financial strength and performance of our
businesses. 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 except per share amounts)

Q4 2014 Q4 2013 2014 2013

Cash flows from operating activities 1,527 1,838 6,241 6,476

Bell Aliant dividends paid to BCE - 48 95 191

Capital expenditures (1,076) (1,139) (3,717) (3,571)

Cash dividends paid on preferred shares (40) (31) (134) (127)

Cash dividends paid by subsidiaries to
non-controlling interest (1) (68) (145) (283)

Acquisition costs paid 68 30 131 80

Voluntary defined benefit pension plan
contribution 350 - 350 -

Bell Aliant free cash flow 5 (4) (77) (195)

Free cash flow 833 674 2,744 2,571

Average number of common shares
outstanding 837.7 775.9 793.7 775.8

Free cash flow per share 1.01 0.86 3.46 3.31









(4) We use ARPU, churn, COA, capital intensity and dividend payout
ratio to measure the success of our strategic imperatives. These
key performance indicators are not accounting measures and may not
be comparable to similar measures presented by other issuers. See
section 8.2, Non-GAAP Financial Measures and Key Performance
Indicators (KPIs) in BCE's Q3 2014 MD&A for a definition of such
KPIs.





CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements made in this news release are forward-looking
statements. These statements include, without limitation, statements
relating to our 2015 financial guidance (including revenues, Adjusted
EBITDA, capital intensity, Adjusted EPS and free cash flow), our
business outlook, objectives, plans and strategic priorities, BCE's
2015 annualized common share dividend and common share dividend policy,
our network deployment plans, the expected timing and completion of
BCE's proposed acquisition of GLENTEL and the subsequent divestiture of
a 50% ownership interest in GLENTEL to Rogers, and other statements
that are not historical facts. 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 we caution you against relying on any of
these forward-looking statements. The forward-looking statements
contained in this news release describe our expectations as of February
5, 2015 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
special items or of any dispositions, monetizations, mergers,
acquisitions, other business combinations or other transactions that
may be announced or that may occur after February 5, 2015. The
financial impact of these transactions and 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 2015 financial results, as well as our objectives,
strategic priorities and business outlook for 2015, 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 2015
contained in this news release, including, but not limited to:


Canadian Economic and Market Assumptions


-- slower economic growth, given the Bank of Canada's estimated
growth in Canadian GDP of approximately 2.1% in 2015, compared
to estimated growth of 2.3% in 2014
-- weaker employment growth compared to 2014, as the overall level
of business investment is expected to remain soft
-- interest rates to remain largely unchanged in 2015 or slightly
decrease year-over-year
-- a sustained level of wireline and wireless competition in both
consumer and business markets
-- higher, but slowing, wireless industry penetration and
smartphone adoption
-- industry pricing discipline even with the potential unusual
market activity that could result from the possible expiry of
three-year service contracts, entered into before the Wireless
Code of Conduct came into effect, and of new two-year plans,
driving higher expiries and higher transaction volumes, to the
extent that the CRTC's June 3, 2015 Wireless Code of Conduct
application date is found to be valid
-- relatively stable media advertising market and escalating costs
to secure TV programming

Assumptions Concerning our Bell Wireless Segment


-- higher subscriber acquisition and retention spending, driven by
a greater number of year-over-year gross additions and customer
device upgrades
-- higher than industry-average blended ARPU and Adjusted EBITDA
growth, driven by a greater mix of postpaid smartphone
customers and accelerating data consumption on the 4G LTE
network, and higher access rates on new two-year contracts
-- completion of the LTE network expected to cover 98% of the
Canadian population
-- no material financial, operational or competitive consequences
of changes in regulations affecting our wireless business

Assumptions Concerning our Bell Wireline Segment


-- positive full-year revenue and Adjusted EBITDA growth
-- IPTV contributing to TV and broadband Internet market share
growth, as well as fewer residential NAS losses despite
increasing wireless substitution, resulting in fewer
year-over-year total wireline residential net customer losses
and higher penetration of three-product households
-- residential services ARPU growth from increased penetration of
three-product households, promotion expiries and price
increases
-- continued large business customer migration to IP-based systems
and competitive re-price pressures in business and wholesale
markets
-- improving year-over-year rate of decline in Business Markets
revenue and Adjusted EBITDA
-- new broadband fibre deployment expected to be largely FTTH/
FTTP
-- no material financial, operational or competitive consequences
of changes in regulations affecting our wireline business

Assumptions Concerning our Bell Media Segment


-- lower year-over-year Adjusted EBITDA and margin, due to rising
sports rights and specialty content costs, CraveTV investment,
higher regulatory Canadian content spending, the expiry of
certain CRTC benefits as well as the completion of the Local
Programming Improvement Fund
-- ability to successfully acquire highly rated programming and
differentiated content
-- building and maintaining strategic supply arrangements for
content on all four screens
-- successful scaling of CraveTV
-- TV unbundling and growth in OTT viewing expected to result in
moderately lower subscriber levels for many Bell Media TV
properties
-- no material financial, operational or competitive consequences
of changes in regulations affecting our media business

Financial Assumptions Concerning BCE


The following constitute BCE's principal financial assumptions for 2015:



-- total post-employment benefit plans cost to be approximately
$370 million, based on an estimated accounting discount rate of
4%, comprised of an estimated above Adjusted EBITDA
post-employment benefit plans service cost of approximately
$260 million and an estimated below Adjusted EBITDA net
post-employment benefit plans financing cost of approximately
$110 million
-- depreciation and amortization expense of approximately $3,425
million
-- net interest expense of approximately $970 million
-- tax adjustments (per share) of approximately $0.02
-- an effective tax rate of approximately 26%
-- non-controlling interest of approximately $50 million
-- total pension plan cash funding of approximately $400 million
-- cash taxes of approximately $750 million
-- net interest payments of approximately $925 million
-- working capital changes, severance and other costs of
approximately $125 million to $225 million
-- average BCE common shares outstanding of approximately 845
million
-- an annual common share dividend of $2.60 per share


The foregoing assumptions, although considered reasonable by BCE on
February 5, 2015, 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 2015 financial guidance, are listed below. The
realization of our forward-looking statements, including our ability to
meet our 2015 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:



-- regulatory initiatives and proceedings, government
consultations and government positions that affect us and
influence our business
-- 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, financial results
and operating metrics
-- the level of technological substitution and the presence of
alternative service providers, contributing to reduced
utilization of traditional wireline services
-- the adverse effect of new technology and increasing
fragmentation in Bell TV's TV distribution market and
Bell Media's markets
-- rising programming costs and Bell Media's inability to secure
key content
-- variability in subscriber acquisition and retention costs based
on subscriber acquisitions, retention volumes, smartphone sales
and handset discount levels
-- economic and financial market conditions, the level of consumer
confidence and spending, and the demand for, and prices of, our
products and services
-- Bell Media's significant dependence on continued demand for
advertising, and the potential adverse effect thereon from
economic conditions and ratings/audience levels
-- our inability to protect our networks, systems, applications,
data centres, electronic and physical records and the
information stored therein against cyber attacks, unauthorized
access or entry, damage from fire, natural disasters and other
events
-- the complexity of our product offerings, pricing plans,
promotions, technology platforms and billing systems
-- our failure to satisfy customer expectations and build a simple
and expeditious operational delivery model
-- our failure to carry out network evolution activities, and to
meet network upgrade or deployment timelines within our capital
intensity target
-- our inability to discontinue certain services as necessary to
improve capital and operating efficiencies
-- our failure to anticipate and respond to technological change,
upgrade our networks and rapidly offer new products and
services
-- our failure to implement or maintain, on a timely basis,
effective IT systems, and the complexity and costs of our IT
environment
-- our failure to maintain optimal network operating performance
in the context of significant increases in broadband demand and
in the volume of wireless data-driven traffic
-- employee retention and performance, and labour disruptions
-- pension obligation volatility and increased contributions to
post-employment benefit plans
-- events affecting the functionality of, and our ability to
protect, test, maintain and replace, our networks, equipment
and other facilities
-- in-orbit risks of satellites used by Bell TV
-- events affecting the ability of third-party suppliers to
provide to us, and our ability to purchase, critical products
and services
-- the quality of our network and customer equipment and the
extent to which they may be subject to manufacturing defects
-- unfavourable resolution of legal proceedings and, in
particular, class actions
-- unfavourable changes in applicable laws
-- our capital and other expenditure levels, financing and debt
requirements and inability to access adequate sources of
capital and generate sufficient cash flows from operations to
meet our cash requirements and implement our business plan, as
well as our inability to manage various credit, liquidity and
market risks
-- ineffective change management resulting from restructurings and
other corporate initiatives, and the failure to successfully
integrate business acquisitions and existing business units
-- our failure to evolve practices to effectively monitor and
control fraudulent activities
-- copyright theft and other unauthorized use of our content
-- the theft of our DTH satellite TV services
-- our failure to execute our strategic imperatives and business
development plans in order to produce the expected benefits,
including to continue to implement our targeted cost reduction
initiatives, and our failure to develop a successful business
strategy
-- higher taxes due to new taxes, higher tax rates or changes to
tax laws, and our inability to predict the outcome of
government audits
-- health concerns about radio frequency emissions from wireless
communications devices
-- our inability to maintain customer service and our networks
operational in the event of the occurrence of epidemics,
pandemics and other health risks
-- our failure to recognize and adequately respond to climate
change and public expectations on environmental matters
-- BCE's dependence on the ability of its subsidiaries, joint
arrangements and other entities in which it has an interest to
pay dividends or otherwise make distributions to it
-- 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
-- the expected timing and completion of the proposed acquisition
of GLENTEL and of the subsequent divestiture of a 50% ownership
interest to Rogers are subject to closing conditions and other
risks and uncertainties and there can be no certainty that
anticipated benefits will be realized


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 Safe Harbour Notice Concerning
Forward-Looking Statements dated February 5, 2015, for additional
information with respect to certain of these and other assumptions and
risks, filed by BCE with the Canadian provincial securities regulatory
authorities (available at Sedar.com) and with the U.S. Securities and Exchange Commission (available at SEC.gov). This document is also available at BCE.ca.



BCE's Safe Harbour Notice Concerning Forward-Looking Statements dated
February 5, 2015 is incorporated by reference into this news release.



For additional information, please refer to the February 5, 2015
presentation entitled "Q4 2014 Results and 2015 Analyst Guidance Call"
available on BCE's website.


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 Canada and Bell
Aliant brands. Bell Media is Canada's premier multimedia company with
leading assets in television, radio, out of home 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 initiative promotes Canadian mental health with
national awareness and anti-stigma campaigns, like Clara's Big Ride for
Bell Let's Talk and Bell Let's Talk Day, and significant Bell funding
of community care and access, research, and workplace initiatives. To
learn more, please visit Bell.ca/LetsTalk.




SOURCE BCE INC.

BCE INC.

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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