Supplementary Financial Information
Q1
BCE Investor Relations
Thane Fotopoulos
514-870-4619
thane.fotopoulos@bell.ca
Supplementary
Financial Information
First Quarter 2014
BCE (1)
Consolidated Operational Data (2)
($ millions of Canadian dollars, except share amounts) (unaudited)
Operating revenues
Operating costs (A)
Post-employment benefit plans service cost
EBITDA (3)
EBITDA margin (3)
Severance, acquisition and other costs
Depreciation
Amortization
Finance costs
Interest expense
Interest on post-employment benefit obligations
Other income
Income taxes
Net earnings
Net earnings attributable to:
Common shareholders
Preferred shareholders
Non-controlling interest
Net earnings
Q1
2014
Q1
2013
$ change
% change
5,099
(3,003)
(74)
2,022
39.7%
(38)
(699)
(167)
4,919
(2,880)
(77)
1,962
39.9%
(33)
(675)
(163)
180
(123)
3
60
(5)
(24)
(4)
3.7%
(4.3%)
3.9%
3.1%
(0.2) pts
(15.2%)
(3.6%)
(2.5%)
(235)
(25)
87
(231)
714
(221)
(37)
80
(241)
672
(14)
12
7
10
42
(6.3%)
32.4%
8.8%
4.1%
6.3%
615
33
66
714
566
33
73
672
0.73
0.73
49
(7)
42
8.7%
0.0%
(9.6%)
6.3%
$
$
0.06
0.06
8.2%
8.2%
$
0.035
6.0%
$
49
(10)
(12)
27
(0.02)
$
0.04
Net earnings per common share - basic
Net earnings per common share - diluted
$
$
0.79
0.79
Dividends per common share
$
0.6175
$ 0.5825
776.5
777.2
777.3
775.7
776.3
775.9
Average number of common shares outstanding - basic (millions)
Average number of common shares outstanding - diluted (millions)
Number of common shares outstanding (millions)
Adjusted Net Earnings and EPS
Net earnings attributable to common shareholders
Severance, acquisition and other costs
Net gains on investments
Premiums on early redemption of debt
Adjusted net earnings (3)
Impact on net earnings per share
Adjusted EPS
(3)
$
$
$
615
23
(12)
626
0.02
$
566
23
(2)
12
599
0.04
$
0.81
$
0.77
8.7%
0.0%
n.m.
(100.0%)
4.5%
(50.0%)
5.2%
(A)
Excludes post-employment benefit plans service cost
n.m. : not meaningful
BCE Supplementary Financial Information - First Quarter 2014 Page 2
BCE
Consolidated Operational Data - Historical Trend
($ millions of Canadian dollars, except share amounts) (unaudited)
Operating revenues
Operating costs (A)
Post-employment benefit plans service cost
EBITDA
EBITDA margin
Severance, acquisition and other costs
Depreciation
Amortization
Finance costs
Interest expense
Interest on post-employment benefit obligations
Other income (expense)
Income taxes
Net earnings
Net earnings attributable to:
Common shareholders
Preferred shareholders
Non-controlling interest
Net earnings
Q1 14
Total
2013
Q4 13
Q3 13
Q2 13
Q1 13
5,099
(3,003)
(74)
2,022
39.7%
(38)
(699)
(167)
20,400
(12,019)
(292)
8,089
39.7%
(406)
(2,734)
(646)
5,382
(3,312)
(72)
1,998
37.1%
(48)
(695)
(160)
5,099
(2,962)
(74)
2,063
40.5%
(297)
(683)
(162)
5,000
(2,865)
(69)
2,066
41.3%
(28)
(681)
(161)
4,919
(2,880)
(77)
1,962
39.9%
(33)
(675)
(163)
(235)
(25)
87
(231)
714
(931)
(150)
(6)
(828)
2,388
(240)
(37)
1
(226)
593
(242)
(38)
(24)
(165)
452
(228)
(38)
(63)
(196)
671
(221)
(37)
80
(241)
672
615
33
66
714
1,975
131
282
2,388
495
33
65
593
343
32
77
452
571
33
67
671
566
33
73
672
Net earnings per common share - basic
Net earnings per common share - diluted
$
$
Dividends per common share
$ 0.6175
$ 2.3300
$ 0.5825
$ 0.5825
$ 0.5825
$ 0.5825
776.5
777.2
777.3
775.8
776.4
775.9
775.9
776.6
775.9
775.9
776.3
775.9
775.9
776.6
775.9
775.7
776.3
775.9
$
495
33
12
540
0.06
$
0.70
Average number of common shares outstanding - basic (millions)
Average number of common shares outstanding - diluted (millions)
Number of common shares outstanding (millions)
Adjusted Net Earnings and EPS
Net earnings attributable to common shareholders
Severance, acquisition and other costs
Net (gains) losses on investments
Premiums on early redemption of debt
Adjusted net earnings
Impact on net earnings per share
Adjusted EPS
(A)
0.79
0.79
$
$
2.55
2.54
$
615
23
(12)
626
0.02
$
1,975
299
7
36
2,317
0.44
$
0.81
$
2.99
$
$
0.64
0.63
$
$
0.44
0.44
$
$
0.74
0.74
$
$
0.73
0.73
$
343
222
(2)
21
584
0.31 $
571
21
(1)
3
594
0.03 $
566
23
(2)
12
599
0.04
$
0.75
0.77
0.77
$
$
Excludes post-employment benefit plans service cost
BCE Supplementary Financial Information - First Quarter 2014 Page 3
(1)
BCE
Segmented Data (2)
Q1
2014
Q1
2013
$ change
% change
Revenues
Bell Wireless
Bell Wireline
Bell Media
Inter-segment eliminations
Total Bell
Bell Aliant
Inter-segment eliminations
Total BCE
1,472
2,462
722
(118)
4,538
676
(115)
5,099
1,409
2,508
513
(82)
4,348
684
(113)
4,919
63
(46)
209
(36)
190
(8)
(2)
180
4.5%
(1.8%)
40.7%
(43.9%)
4.4%
(1.2%)
(1.8%)
3.7%
Operating costs
Bell Wireless
Bell Wireline
Bell Media
Inter-segment eliminations
Total Bell
Bell Aliant
Inter-segment eliminations
Total BCE
(844)
(1,532)
(572)
118
(2,830)
(362)
115
(3,077)
(824)
(1,550)
(415)
82
(2,707)
(363)
113
(2,957)
(20)
18
(157)
36
(123)
1
2
(120)
(2.4%)
1.2%
(37.8%)
43.9%
(4.5%)
0.3%
1.8%
(4.1%)
EBITDA
Bell Wireless
Margin
Bell Wireline
Margin
Bell Media
Margin
Total Bell
Margin
Bell Aliant
Margin
Total BCE
Margin
628
42.7%
930
37.8%
150
20.8%
1,708
37.6%
314
46.4%
2,022
39.7%
585
41.5%
958
38.2%
98
19.1%
1,641
37.7%
321
46.9%
1,962
39.9%
43
7.4%
1.2 pts
(2.9%)
(0.4) pts
53.1%
1.7 pts
4.1%
(0.1) pts
(2.2%)
(0.5) pts
3.1%
(0.2) pts
Capital expenditures
Bell Wireless
Capital Intensity (4)
Bell Wireline
Capital Intensity
Bell Media
Capital Intensity
Total Bell
Capital Intensity
Bell Aliant
Capital Intensity
Total BCE
Capital Intensity
117
7.9%
463
18.8%
14
1.9%
594
13.1%
135
20.0%
729
14.3%
122
8.7%
460
18.3%
12
2.3%
594
13.7%
128
18.7%
722
14.7%
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
(28)
52
67
(7)
60
5
(3)
(2)
(7)
(7)
4.1%
0.8 pts
(0.7%)
(0.5) pts
(16.7%)
0.4 pts
0.0%
0.6 pts
(5.5%)
(1.3) pts
(1.0%)
0.4 pts
BCE Supplementary Financial Information - First Quarter 2014 Page 4
BCE
Segmented Data - Historical Trend
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Q1 14
Total
2013
Q4 13
Q3 13
Q2 13
Q1 13
Revenues
Bell Wireless
Bell Wireline
Bell Media
Inter-segment eliminations
Total Bell
Bell Aliant
Inter-segment eliminations
Total BCE
1,472
2,462
722
(118)
4,538
676
(115)
5,099
5,849
10,097
2,557
(394)
18,109
2,759
(468)
20,400
1,505
2,601
821
(114)
4,813
688
(119)
5,382
1,493
2,482
664
(115)
4,524
696
(121)
5,099
1,442
2,506
559
(83)
4,424
691
(115)
5,000
1,409
2,508
513
(82)
4,348
684
(113)
4,919
Operating costs
Bell Wireless
Bell Wireline
Bell Media
Inter-segment eliminations
Total Bell
Bell Aliant
Inter-segment eliminations
Total BCE
(844)
(1,532)
(572)
118
(2,830)
(362)
115
(3,077)
(3,509)
(6,303)
(1,874)
394
(11,292)
(1,487)
468
(12,311)
(976)
(1,667)
(591)
114
(3,120)
(383)
119
(3,384)
(876)
(1,559)
(465)
115
(2,785)
(372)
121
(3,036)
(833)
(1,527)
(403)
83
(2,680)
(369)
115
(2,934)
(824)
(1,550)
(415)
82
(2,707)
(363)
113
(2,957)
EBITDA
Bell Wireless
Margin
628
42.7%
2,340
40.0%
529
35.1%
617
41.3%
609
42.2%
585
41.5%
Bell Wireline
Margin
Bell Media
Margin
Total Bell
Margin
Bell Aliant
Margin
Total BCE
Margin
930
37.8%
150
20.8%
1,708
37.6%
314
46.4%
2,022
39.7%
3,794
37.6%
683
26.7%
6,817
37.6%
1,272
46.1%
8,089
39.7%
934
35.9%
230
28.0%
1,693
35.2%
305
44.3%
1,998
37.1%
923
37.2%
199
30.0%
1,739
38.4%
324
46.6%
2,063
40.5%
979
39.1%
156
27.9%
1,744
39.4%
322
46.6%
2,066
41.3%
958
38.2%
98
19.1%
1,641
37.7%
321
46.9%
1,962
39.9%
Capital expenditures
Bell Wireless
Capital Intensity
Bell Wireline
Capital Intensity
Bell Media
Capital Intensity
Total Bell
Capital Intensity
Bell Aliant
Capital Intensity
Total BCE
Capital Intensity
117
7.9%
463
18.8%
14
1.9%
594
13.1%
135
20.0%
729
14.3%
639
10.9%
2,247
22.3%
115
4.5%
3,001
16.6%
570
20.7%
3,571
17.5%
226
15.0%
702
27.0%
64
7.8%
992
20.6%
147
21.4%
1,139
21.2%
157
10.5%
562
22.6%
23
3.5%
742
16.4%
138
19.8%
880
17.3%
134
9.3%
523
20.9%
16
2.9%
673
15.2%
157
22.7%
830
16.6%
122
8.7%
460
18.3%
12
2.3%
594
13.7%
128
18.7%
722
14.7%
BCE Supplementary Financial Information - First Quarter 2014 Page 5
Bell Wireless
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Bell Wireless
Revenue
Service
Product
Total external Bell Wireless revenues
Inter-segment
Total Bell Wireless operating revenues
Operating costs
EBITDA
EBITDA margin (Total revenues)
EBITDA margin (Service revenues)
Capital expenditures
Capital intensity
Wireless gross activations
Postpaid
Wireless net activations
Postpaid
Wireless subscribers end of period (EOP)
Postpaid
Average revenue per unit (ARPU)($/month) (4)
Churn (%) (average per month) (4)
(1)
Q1
2014
Q1
2013
% change
1,364
94
1,458
14
1,472
(844)
628
42.7%
46.0%
1,303
93
1,396
13
1,409
(824)
585
41.5%
44.9%
4.7%
1.1%
4.4%
7.7%
4.5%
(2.4%)
7.4%
1.2 pts
1.1 pts
117
7.9%
122
8.7%
4.1%
0.8 pts
351,729
371,217
(5.2%)
275,163
295,136
(6.8%)
(15,678)
(8,957)
(75.0%)
33,964
59,497
(42.9%)
7,762,656
7,672,075
1.2%
6,711,656
57.90
6,484,542
55.92
3.5%
3.5%
1.58%
1.65%
0.07 pts
Prepaid
3.67%
3.79%
0.12 pts
Postpaid
1.24%
442
1.25%
404
0.01 pts
(9.4%)
Cost of acquisition (COA) (4) ($/sub)
BCE Supplementary Financial Information - First Quarter 2014 Page 6
Bell Wireless - Historical Trend
Q1 14
Total
2013
Q4 13
Q3 13
Q2 13
Q1 13
1,364
94
1,458
14
1,472
(844)
628
42.7%
46.0%
5,362
432
5,794
55
5,849
(3,509)
2,340
40.0%
43.6%
1,359
134
1,493
12
1,505
(976)
529
35.1%
38.9%
1,372
106
1,478
15
1,493
(876)
617
41.3%
45.0%
1,328
99
1,427
15
1,442
(833)
609
42.2%
45.9%
1,303
93
1,396
13
1,409
(824)
585
41.5%
44.9%
117
7.9%
639
10.9%
226
15.0%
157
10.5%
134
9.3%
122
8.7%
Wireless gross activations
Postpaid
351,729
275,163
1,694,055
1,332,423
462,469
368,154
438,722
333,081
421,647
336,052
371,217
295,136
Wireless net activations
Postpaid
(15,678)
33,964
378,121
93,700
119,520
89,459
102,714
43,566
96,390
7,778,334
6,677,692
7,778,334
6,677,692
7,805,100
6,683,646
7,715,641
6,580,932
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Bell Wireless
Revenue
Service
Product
Total external Bell Wireless revenues
Inter-segment
Total Bell Wireless operating revenues
Operating costs
EBITDA
EBITDA margin (Total revenues)
EBITDA margin (Service revenues)
Capital expenditures
Capital intensity
Wireless subscribers EOP
Postpaid
(A)
(A)
7,762,656
6,711,656
217,768
(8,957)
59,497
7,672,075
6,484,542
Average revenue per unit (ARPU)($/month)
57.90
57.25
57.92
58.30
56.85
55.92
Churn (%)(average per month)
1.58%
1.60%
1.59%
1.50%
1.64%
1.65%
3.67%
1.24%
3.55%
1.25%
3.41%
1.29%
3.27%
1.20%
3.71%
1.27%
3.79%
1.25%
442
421
468
403
402
404
Prepaid
Postpaid
Cost of acquisition (COA)($/sub)
(A)
In Q4 2013, following a review of our wireless subscriber metrics, our 2013 postpaid subscriber base was reduced by 99,098 customers to exclude all
machine-to-machine subscribers. Additionally, our postpaid subscriber base was reduced by 18,354 subscribers to adjust for customer deactivations and by 8,022
subscribers subsequent to a review of customer accounts. Our prepaid subscriber base was increased by 5,008 customers subsequent to a review of subscriber metrics.
BCE Supplementary Financial Information - First Quarter 2014 Page 7
Bell Wireline (1)
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Bell Wireline
Data
Local & access
Long distance
Equipment & other
Total external revenues
Inter-segment revenues
Total Bell Wireline operating revenues
Operating costs
EBITDA
EBITDA Margin
Capital expenditures
Capital intensity
Local
Network access services (NAS)
Residential
Business
Total
Network access service net (losses)/activations
Residential
Business
Total
High-speed Internet
High-speed internet net activations
High-speed internet subscribers EOP
TV
Net subscriber activations
Fibe TV
Total subscribers EOP
Fibe TV
Q1
2014
Q1
2013
% change
1,463
603
162
149
2,377
85
2,462
(1,532)
930
37.8%
1,433
646
184
164
2,427
81
2,508
(1,550)
958
38.2%
2.1%
(6.7%)
(12.0%)
(9.1%)
(2.1%)
4.9%
(1.8%)
1.2%
(2.9%)
(0.4) pts
463
18.8%
460
18.3%
(0.7%)
(0.5) pts
2,586,791
2,554,225
5,141,016
2,856,757
2,679,736
5,536,493
(9.5%)
(4.7%)
(7.1%)
(65,638)
(35,595)
(101,233)
(83,557)
(24,889)
(108,446)
21.4%
(43.0%)
6.7%
15,627
2,200,170
3,952
2,130,773
n.m.
3.3%
28,561
54,680
2,306,994
534,110
13,971
47,463
2,169,954
295,761
n.m.
15.2%
6.3%
80.6%
n.m. : not meaningful
BCE Supplementary Financial Information - First Quarter 2014 Page 8
Bell Wireline - Historical Trend
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Bell Wireline
Data
Local & access
Long distance
Equipment & other
Total external revenues
Inter-segment revenues
Total Bell Wireline operating revenues
Operating costs
EBITDA
EBITDA Margin
Capital expenditures
Capital intensity
Local
Network access services (NAS)
Residential
Business
Total
Network access service net (losses)/activations
Residential
Business
Total
High-speed Internet
High-speed internet net activations
High-speed internet subscribers EOP
TV
Net subscriber activations
Fibe TV
Total subscribers EOP
Fibe TV
Q1 14
Total
2013
Q4 13
Q3 13
Q2 13
Q1 13
1,463
603
162
149
2,377
85
2,462
(1,532)
930
37.8%
5,828
2,497
722
707
9,754
343
10,097
(6,303)
3,794
37.6%
1,513
606
171
222
2,512
89
2,601
(1,667)
934
35.9%
1,426
613
184
168
2,391
91
2,482
(1,559)
923
37.2%
1,456
632
183
153
2,424
82
2,506
(1,527)
979
39.1%
1,433
646
184
164
2,427
81
2,508
(1,550)
958
38.2%
463
18.8%
2,247
22.3%
702
27.0%
562
22.6%
523
20.9%
460
18.3%
2,586,791
2,554,225
5,141,016
2,652,429
2,589,820
5,242,249
2,652,429
2,589,820
5,242,249
2,715,710
2,622,298
5,338,008
2,774,667
2,650,824
5,425,491
2,856,757
2,679,736
5,536,493
(65,638)
(35,595)
(101,233)
(287,885)
(114,805)
(402,690)
(63,281)
(32,478)
(95,759)
(58,957)
(28,526)
(87,483)
(82,090)
(28,912)
(111,002)
(83,557)
(24,889)
(108,446)
15,627
2,200,170
57,722
2,184,543
15,690
2,184,543
35,634
2,168,853
2,446
2,133,219
3,952
2,130,773
28,561
122,450
36,189
46,685
25,605
13,971
54,680
231,132
60,301
72,813
50,555
47,463
2,306,994
2,278,433
2,278,433
2,242,244
2,195,559
2,169,954
534,110
479,430
479,430
419,129
346,316
295,761
BCE Supplementary Financial Information - First Quarter 2014 Page 9
BCE (1)
Net debt and other information (2)
BCE - Net debt and preferred shares
At March 31, 2014
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
BCE
Bell
Aliant
700
2,226
(38)
2,888
BCE
3,201
16,010
1,698
(720)
20,189
March 31
2014
Dec. 31
2013
2,501
13,784
1,698
(682)
17,301
2,286
13,765
1,698
(319)
17,430
2.46
8.27
2.49
8.40
Q3 2013 Q2 2013
Q1 2013
Bell
2,501
13,784
1,698
(682)
17,301
Debt due within one year
Long-term debt
Preferred shares - BCE (A)
Cash and cash equivalents
Net debt (3)
Bell - Net debt and preferred shares
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Debt due within one year
Long-term debt
Preferred shares - BCE (A)
Cash and cash equivalents
Net Debt
Net Debt / Adjusted EBITDA (4)
Adjusted EBITDA /Net interest expense, excluding interest on post-employment benefit obligations and including 50% of preferred dividends
Bell Media Inc. - Proportionate Information
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Proportionate Net Debt
Proportionate EBITDA
(4)
Q1 2014
Total
2013
Q4 2013
30
129
103
593
103
209
Cash Flow Information
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
(3)
Free Cash Flow (FCF)
Cash from operating activities, excluding acquisition costs paid
Capital expenditures
Dividends paid on preferred shares
Dividends paid by subsidiaries to non-controlling interest
Bell Aliant dividends to BCE
FCF
Cash Flow Information - Historical Trend
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Free Cash Flow (FCF)
Cash from operating activities, excluding acquisition costs paid
Capital expenditures
Dividends paid on preferred shares
Dividends paid by subsidiaries to non-controlling interest
Bell Aliant dividends to BCE
FCF
(A)
143
172
202
134
206
78
Q1
2014
Q1
2013 $ change % change
888
(594)
(32)
262
826
(594)
(26)
(7)
48
247
62
7.5%
0.0%
(6) (23.1%)
7
100.0%
(48) (100.0%)
15
6.1%
Q1
2014
Total
2013
Q4
2013
Q3
2013
Q2
2013
Q1
2013
888
(594)
(32)
262
5,521
(3,001)
(127)
(13)
191
2,571
1,649
(992)
(31)
48
674
1,479
(742)
(38)
48
747
1,567
(673)
(32)
(6)
47
903
826
(594)
(26)
(7)
48
247
Net debt includes 50% of preferred shares
BCE Supplementary Financial Information - First Quarter 2014 Page 10
(1)
BCE
(2)
Consolidated Statements of Financial Position
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
ASSETS
Current assets
Cash
Cash equivalents
Trade and other receivables
Inventory
Prepaid expenses
Assets held for sale
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Deferred tax assets
Investments in associates and joint ventures
Other non-current assets
Goodwill
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade payables and other liabilities
Interest payable
Dividends payable
Current tax liabilities
Debt due within one year
Total current liabilities
Non-current liabilities
Long-term debt
Deferred tax liabilities
Post-employment benefit obligation
Other non-current liabilities
Total non-current liabilities
Total liabilities
EQUITY
Equity attributable to BCE shareholders
Preferred shares
Common shares
Contributed surplus
Accumulated other comprehensive income
Deficit
Total Equity attributable to BCE shareholders
Non-controlling interest
Total equity
Total liabilities and equity
Number of common shares outstanding
March 31
2014
December 31
2013
99
621
2,861
380
503
193
193
4,850
220
115
3,043
383
415
719
175
5,070
20,671
9,526
199
789
752
8,376
40,313
45,163
20,743
9,552
165
775
698
8,381
40,314
45,384
3,661
145
555
191
3,201
7,753
4,339
147
466
367
2,571
7,890
16,010
1,217
2,744
1,458
21,429
29,182
16,341
1,318
2,127
1,458
21,244
29,134
3,395
13,688
2,605
28
(4,933)
14,783
1,198
15,981
45,163
3,395
13,629
2,615
14
(4,642)
15,011
1,239
16,250
45,384
777.3
775.9
BCE Supplementary Financial Information - First Quarter 2014 Page 11
BCE (1)
Consolidated Cash Flow Data (2)
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Net earnings
Adjustments to reconcile net earnings to cash flows from operating activities
Severance, acquisition and other costs
Depreciation and amortization
Post-employment benefit plans cost
Net interest expense
Gains on investments
Income taxes
Contributions to post-employment benefit plans
Payments under other post-employment benefit plans
Severance and other costs paid
Acquisition costs paid
Interest paid
Income taxes paid (net of refunds)
Net change in operating assets and liabilities
Cash flows from operating activities
Bell Aliant dividends paid to BCE
Capital expenditures
Cash dividends paid on preferred shares
Cash dividends paid by subsidiaries to non-controlling interest
Acquisition costs paid
Bell Aliant Free Cash Flow
Free Cash Flow (3)
Bell Aliant free cash flow, excluding dividends paid
Business acquisitions
Acquisition costs paid
Business dispositions
Increase in investments
Decrease in investments
Spectrum payment
Other investing activities
Increase in notes payable and bank advances
Reduction in securitized trade receivables
Issue of long-term debt
Repayment of long-term debt
Premiums on early redemption of debt
Cash dividends paid on common shares
Issue of common shares
Issue of equity securities by subsidiaries to non-controlling interest
Other financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Other information
Free cash flow per share (3)
Annualized cash flow yield (5)
$
Q1
2014
Q1
2013
714
672
42
38
866
99
234
(12)
231
(88)
(18)
(68)
(14)
(229)
(361)
(410)
982
(729)
(32)
(7)
14
34
33
838
114
220
(2)
241
(98)
(18)
(49)
(10)
(196)
(148)
(557)
1,040
48
(722)
(26)
(73)
10
(30)
5
28
(15)
14
(10)
(10)
10
(19)
(4)
(33)
(213)
147
(58)
(48)
(7)
(6)
66
4
64
262
(34)
(14)
538
(6)
(113)
1
601
33
(415)
(452)
32
(48)
123
385
335
720
247
(18)
(5)
(10)
2
338
(14)
1,007
(289)
(17)
(440)
13
230
(18)
779
1,026
129
1,155
15
(16)
5
(4)
538
(6)
(2)
(113)
1
263
14
(974)
(126)
17
(12)
19
(230)
(30)
(656)
(641)
206
(435)
0.34
7.0%
$
0.32
6.4%
$ change
$
0.02
0.6 pts
BCE Supplementary Financial Information - First Quarter 2014 Page 12
BCE
Consolidated Cash Flow Data - Historical Trend
Total
2013
($ millions of Canadian dollars, except where otherwise indicated) (unaudited)
Q1 14
Net earnings
Adjustments to reconcile net earnings to cash flows from operating activities
Severance, acquisition and other costs
Depreciation and amortization
Post-employment benefit plans cost
Net interest expense
(Gains) losses on investments
Income taxes
Contributions to post-employment benefit plans
Payments under other post-employment benefit plans
Severance and other costs paid
Acquisition costs paid
Interest paid
Income taxes paid (net of refunds)
Net change in operating assets and liabilities
Cash flows from operating activities
Bell Aliant dividends paid to BCE
Capital expenditures
Cash dividends paid on preferred shares
Cash dividends paid by subsidiaries to non-controlling interest
Acquisition costs paid
Bell Aliant Free Cash Flow
Free Cash Flow
Bell Aliant free cash flow, excluding dividends paid
Business acquisitions
Acquisition costs paid
Business dispositions
Increase in investments
Decrease in investments
Spectrum payment
Other investing activities
Increase (decrease) in notes payable and bank advances
Reduction in securitized trade receivables
Issue of long-term debt
Repayment of long-term debt
Premiums on early redemption of debt
Cash dividends paid on common shares
Issue of common shares
Issue of equity securities by subsidiaries to non-controlling interest
Other financing activities
714
2,388
38
866
99
234
(12)
231
(88)
(18)
(68)
(14)
(229)
(361)
(410)
982
(729)
(32)
(7)
14
34
262
(34)
(14)
538
(6)
(113)
1
601
33
(415)
(452)
32
(48)
123
385
335
720
406
3,380
442
924
7
828
(341)
(73)
(203)
(80)
(879)
(470)
147
6,476
191
(3,571)
(127)
(283)
80
(195)
2,571
4
(2,850)
(80)
1
(3)
10
12
272
(14)
4,438
(2,495)
(55)
(1,795)
13
230
(53)
(2,365)
206
129
335
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Other information
Free cash flow per share
Annualized cash flow yield
$
0.34
7.0%
$
3.31
7.2%
Q4 13
Q3 13
Q2 13
Q1 13
593
452
671
672
28
842
107
225
(1)
196
(76)
(18)
(45)
(8)
(206)
(37)
190
1,868
47
(830)
(32)
(74)
8
(84)
903
37
(8)
1
(1)
3
14
(321)
1,408
(513)
(10)
(452)
(8)
150
1,053
1,155
2,208
33
838
114
220
(2)
241
(98)
(18)
(49)
(10)
(196)
(148)
(557)
1,040
48
(722)
(26)
(73)
10
(30)
247
(18)
(5)
(10)
2
338
(14)
1,007
(289)
(17)
(440)
13
230
(18)
779
1,026
129
1,155
48
855
109
239
12
226
(83)
(18)
(65)
(30)
(231)
(232)
415
1,838
48
(1,139)
(31)
(68)
30
(4)
674
(44)
(1)
(30)
(1)
5
(240)
15
(178)
(452)
(16)
(942)
(268)
603
335
$
0.86 $
7.2%
297
845
112
240
(2)
165
(84)
(19)
(44)
(32)
(246)
(53)
99
1,730
48
(880)
(38)
(68)
32
(77)
747
29
(2,844)
(32)
(1)
(2)
495
2,008
(1,515)
(28)
(451)
(11)
(2,352)
(1,605)
2,208
603
0.97 $
7.3%
1.16 $
7.3%
0.32
6.4%
BCE Supplementary Financial Information - First Quarter 2014 Page 13
Accompanying Notes
We report our results of operations in four segments: Bell Wireless, Bell Wireline, Bell Media and Bell Aliant. Our reporting structure reflects how we
manage our business and how we classify our operations for planning and measuring performance.
(1) Throughout this report, BCE means, as the context may require, either BCE Inc. or, collectively, BCE Inc., its subsidiaries, joint arrangements and
associates; Bell means our Bell Wireless, Bell Wireline and Bell Media segments on an aggregate basis; and Bell Aliant means Bell Aliant Inc. and its
subsidiaries and associates.
(2) On July 5, 2013, BCE acquired 100% of the issued and outstanding shares of Astral Media Inc. (Astral). Astral is a media company that operates
specialty and pay TV channels, radio stations, digital media properties and out-of-home advertising platforms.
(3) Non-GAAP Financial Measures
EBITDA and EBITDA margin
The terms EBITDA and EBITDA margin do not have any standardized meaning under International Financial Reporting Standards (IFRS). Therefore, they
are unlikely to be comparable to similar measures presented by other issuers.
We define EBITDA as operating revenues less operating costs (including post-employment benefit plans service cost). We define EBITDA margin as
EBITDA divided by operating revenues.
We use EBITDA and EBITDA margin to evaluate the performance of our businesses as they reflect 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. We believe that certain investors and analysts also use EBITDA and EBITDA margin to evaluate
the performance of our businesses. EBITDA also is one component in the determination of short-term incentive compensation for all management
employees.
EBITDA and EBITDA margin have no directly comparable IFRS financial measure. Alternatively, EBITDA may be reconciled to net earnings as shown in
this document.
Adjusted net earnings and Adjusted earnings per share (EPS)
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 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 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 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.
BCE Supplementary Financial Information – First Quarter 2014
Page 14
Accompanying Notes
Free Cash Flow and Free Cash Flow per share
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.
We define free cash flow 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 non-controlling interest, and Bell Aliant free cash
flow. We define free cash flow per share as follows:
Free cash flow
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.
For free cash flow, the most comparable IFRS financial measure is cash flows from operating activities.
Net debt
The term net debt does not have any standardized meaning under IFRS. Therefore, it is unlikely to be comparable to similar measures presented by other
issuers.
We define net debt as debt due within one year plus long-term debt and 50% of preferred shares less cash and cash equivalents. We include 50% of
outstanding preferred shares in our net debt as it is consistent with the treatment by certain credit rating agencies.
We consider net debt to be an important indicator of the company’s financial leverage because it represents the amount of debt that is not covered by
available cash and cash equivalents. We believe that certain investors and analysts use net debt to determine a company’s financial leverage.
Net debt has no directly comparable IFRS financial measure, but rather is calculated using several asset and liability categories from the statements of
financial position, as shown in this document.
(4) Key Performance Indicators (KPIs)
We use a number of KPIs to measure the success of our strategic imperatives. These KPIs are not accounting measures and may not be comparable to
similar measures presented by other issuers.
Capital Intensity is capital expenditures divided by operating revenues.
Average revenue per user or subscriber (ARPU) represents the measurement of certain service revenues divided by the average subscriber base for
the specified period.
BCE Supplementary Financial Information – First Quarter 2014
Page 15
Accompanying Notes
Churn is the rate at which existing subscribers cancel their services, expressed as a percentage. Churn is calculated as the number of subscribers
disconnected divided by the average subscriber base. It is a measure of monthly customer turnover.
Cost of acquisition (COA) is also referred to as subscriber acquisition costs. COA represents the total cost associated with acquiring a customer and
includes costs such as hardware discounts, marketing and distribution costs. This measure is expressed per gross activation during a specified period.
Net debt to Adjusted EBITDA is Bell net debt divided by twelve-month trailing Bell Adjusted EBITDA. Net debt is debt due within one year, long-term
debt and 50% of preferred shares less cash and cash equivalents. Adjusted EBITDA is Bell EBITDA including dividends from Bell Aliant to BCE.
Adjusted EBITDA to net interest expense is twelve-month trailing Adjusted EBITDA divided by twelve-month trailing net interest expense. Adjusted
EBITDA is Bell EBITDA including dividends from Bell Aliant to BCE. Net interest expense is Bell interest expense excluding interest on post-employment
benefit obligations and including 50% of dividends on preferred shares.
(5) Annualized cash flow yield is calculated as follows:
Trailing 12 month free cash flow
Number of common shares outstanding at end of period multiplied by share price at end of period
BCE Supplementary Financial Information – First Quarter 2014
Page 16