BCE 3Q 2015 Results Boosted by Expanding Gigabit Footprint

MONTREAL — BCE, which provides a comprehensive suite of broadband communication services to residential and business customers from Bell Canada and Bell Aliant, reported Wireline Adjusted EBITDA up 1.1 percent, positive for a fifth consecutive quarter, while its industry-leading margin increased to 41.1 percent.

Largest Gigabit Internet Footprint in Canada
Bell is leading the way in gigabit Internet service in Canada having launched Gigabit Fibe service to more than 1.3 million homes across Québec and Ontario in August and then adding 650,000 more locations in Atlantic Canada in September. Gigabit Fibe is the fastest Internet service available to Canadian consumers, and Bell plans to reach 2.2 million homes with gigabit Internet service by the end of the year. Bell's fiber architecture has significant structural and operating cost advantages over cable and will enable Bell to achieve significantly higher speeds more quickly.

Bell Wireline Revenue Decrease Offset by Growth of Residential Services
Wireline revenue decreased 0.6 percent in Q3 to $3,028 million (Canadian), reflecting a year-over-year decline at Bell Business Markets due to ongoing competitive pricing pressures and reduced customer spending on core connectivity services, business service solutions and data product equipment resulting from continued slow economic growth. This was offset by the performance of Residential Services, which delivered revenue growth of 1.9 percent on continued strong Internet and TV subscriber net additions and higher household ARPU.

With an increasing mix of growth services and a 1.7 percent reduction in operating costs driven by integration synergies with Bell Aliant, ongoing customer service improvement and fiber-related savings, Wireline Adjusted EBITDA increased 1.1 percent over last year to $1.24 million, yielding a 0.6 percentage-point improvement to Bell's wireline margin of 41.1 percent. With solid year-to-date financial performance, Bell Wireline remains on track to deliver its first full-year of positive adjusted EBITDA.

Fibe TV and FibreOP TV
Bell TV added 67,908 net new Fibe TV and FibreOP TV customers this quarter, compared to the 74,450 achieved during an exceptionally strong back-to-school period in Q3 of last year. Less new IPTV footprint expansion in 2015 also impacted the magnitude of new IPTV subscriber activations this quarter. BCE served 1,108,699 IPTV subscribers at the end of Q3, up 29.3 percent compared to Q3 2014.

Highlights

• BCE became the largest TV provider in Canada in Q3 with a combined total of 2,700,710 subscribers, up 3.9 percent from 2,600,418 at the end of Q3 2014.


• High-speed Internet net additions totaled 57,888 in Q3, compared to 64,254 last year. BCE built on its position as the leading


• Internet service provider in Canada with a high-speed Internet subscriber base that reached 3,374,239 at the end of Q3, up 4 percent compared to Q3 2014.


• Wireline data revenues were up 2.8 percent to $1,770 million, driven by combined Internet and TV service revenue growth of 6.3 percent. This was moderated by reduced spending on core connectivity, business service solutions, and data products by our large enterprise customers.