Bell’s fourth quarter earnings show that the company had a banner year and is looking forward to a strong 2015 as well. Revenue was up in all areas of operations, especially in their wireless division, and all of the buzzwords – EPS, EBITDA and ARPU – were all up in the right areas. They also had a significant increase in subscriber numbers that helped boost their revenue. George Cope, President and CEO of BCE Inc. and Bell Canada stated, “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.”
Bell’s wireless operating revenue for the quarter increased by 9.6-percent to $1.65 billion due to 8.1-percent higher service revenues of $1.47 billion. This growth was driven by an increased mix of postpaid subscribers which reflected a higher blended ARPU (Average Revenue Per User) – all caused by increased data usage and a higher average rate in their plan pricing. Wireless data revenues grew by a whopping 26-percent in the quarter – this now represents approximately half of the total wireless revenue. Product revenues also went up 24.6-percent to $1.67 billion due to more activations and upgrades to premium smartphones.
For the full-year 2014, Bell’s Wireless operating revenues increased 6.7-percent to $6.24 billion and service revenues growing 6.6-percent to $5.71 billion and product revenues increasing 11.8-percent to $483 million. Total wireless customers grew 2.5-percent to 7,970,702, with the coveted postpaid customers making up 88-percent of the total at yearend compared to 86-percent in 2013. Of those postpaid customers, their use of smartphones increased to 76-percent for the year…up from 73-percent in 2013.
Even with all of the promotions going on among the different carriers, Bell’s postpaid 2014 churn rate stayed relatively unchanged for 2013 – 1.30-percent vs 1.29-percent, respectively. The blended ARPU increased 5.5-percent to a healthy $61.12 in Q4 – this represents the 20th consecutive quarter of year-over-year improvements. Growth was driven by Bell’s expanding 4G LTE network and an increase in smartphone usage, which has resulted in more data usage. Bell’s 4G LTE network now covers 86-percent of the Canadian population at the end of the 4Q and this is expected to increase to more than 98-percent by the end of 2015 as Bell continues to roll out 4G LTE to smaller towns and rural locations.
Looking down the road toward 2015, Siim Vanaselja, Chief Financial Officer for BCE and Bell Canada stated, “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.”