Stock Name: BA
Amount: CAD 0.475
Announcement Date: 25/04/2012
Record Date: 13/06/2012
Dividend Detail:
Q1 2012 results reflect continued improved financial trends
Over 500,000 premises in Atlantic Canada now have access to FibreOPTMservices
This news release contains forward-looking statements. For a description
of the related risk factors and assumptions please see the section
entitled "Forward-looking Information" later in this release.
HALIFAX, April 25, 2012 /CNW/ - Bell Aliant Inc. (TSX: BA) today
reported financial results for the first quarter of 2012 for Bell
Aliant Inc. (Bell Aliant) and Bell Aliant Regional Communications Inc.
(Bell Aliant GP).
"Returning to revenue growth is a momentous occasion for Bell Aliant and
in the first quarter of 2012 we turned a corner," said Karen Sheriff,
president and chief executive officer, Bell Aliant. "We expected the
quarter to show improved financial trends and the business has
delivered.
"Declines in our traditional local and long distance revenues were
offset by increases in every other major revenue category. While timing
of certain events may result in future quarters of 2012 having softer
year-over-year comparators than the first quarter, we are very pleased
that signs of future growth are occurring in many areas of the
business. We are very well positioned to achieve solid financial
results with improving trends in 2012, in line with the guidance ranges
we set out in February.
"FibreOP is playing a key role in the turnaround, with our first quarter results
particularly strong in FibreOP territories.��Over 500,000 premises in Atlantic Canada now have access
to FibreOP services.��Demand is escalating as we add new features and expand into more markets
and later this year we will launch FibreOP in Sudbury, Ontario. FibreOP is making the difference that we expected and I am confident that we
have chosen the right strategy for the long-term profitability of our
business."
First quarter 2012 highlights1
Bell Aliant Inc. reported net earnings of $87 million for the first
quarter of 2012 compared to $84 million in the same quarter of 2011.
Earnings per share and adjusted earnings per share in the quarter were
$0.38 and $0.45 respectively, compared to $0.37 and $0.44 in the same
quarter of 2011. First quarter 2011 earnings included a $3 million loss
from discontinued operations that did not recur in 2012.
First quarter financial highlights of Bell Aliant GP are summarized as
follows:
(In millions of dollars) (unaudited) | Q1 2012 | Q1 2011 | Percentage Change |
Operating Revenue | $682 | $682 | 0.0% |
EBITDA | 325 | 329 | (1.2%) |
Capital Expenditures | 137 | 120 | 14.6% |
Free Cash Flow* | 80 | 88 | (9.4%) |
* Q1 2011 free cash flow excludes a $200 million lump sum contribution to
defined benefit pension plans.
Operating revenues in the first quarter of 2012 were $682 million,
consistent with revenues in the same quarter of 2011. Declines in local
and long distance revenues as a result of lower network access services
(NAS) were offset by growth in all other major revenue categories, led
by Internet and TV.
Operating expenses in the first quarter of 2012 increased $4 million
(1.2 per cent) compared to the same quarter of 2011. Growth in TV
content costs from higher FibreOP TV sales and other costs of revenues were largely offset by productivity
gains throughout the business. As a result of the expense increases,
EBITDA declined $4 million (1.2 per cent) in the first quarter of 2012
from the same quarter in 2011.
Capital expenditures in the first quarter of 2012 increased $17 million
(14.6 per cent) from the same quarter a year earlier, as a result of
further expansion of the fibre-to-the-home (FTTH) network. Start-up
costs associated with launching FTTH in Bell Aliant's central Canada
territory, passing more homes, and connecting more customers to the
FTTH network than the same quarter in 2011 all contributed to the
increase in capital expenditures. In the first quarter of 2012, Bell
Aliant passed an additional 58,000 homes and businesses with FTTH,
bringing its total FTTH coverage to 516,000 premises at the end of
March 2012.
Free cash flow was $80 million in the first quarter of 2012, down $8
million from the same quarter a year earlier, excluding a $200 million
lump sum contribution to pension plans made in the first quarter of
2011. The decrease was primarily a result of higher capital spending in
the first quarter of 2012 compared to 2011, which was partially offset
by lower regular pension funding in 2012.
Revenue Details
Local service and long distance revenues declined $14 million (4.6 per
cent) and $9 million (9.9 per cent), respectively, in the first quarter
of 2012 compared to the same quarter in 2011. NAS were down 5.4 per
cent at the end of March 2012 from a year earlier, driven by
competitive activity and technology substitution.�� Residential net NAS
declines of 26,000 in the first quarter of 2012 improved from 29,000 in
the first quarter of 2011. Business net NAS declines increased to 9,000
in the first quarter of 2012 from 4,000 in the same quarter of 2011, as
a result of timing of wholesale and enterprise contract losses as well
as continued competitive activity and rationalization of business
lines, including movement to other technologies.
Internet revenue increased $9 million (7.5 per cent) in the first
quarter of 2012 compared to the same period in 2011. Residential
high-speed average revenue per customer (ARPC) continued to grow, with
customer adoption of additional services, along with the carry-over
effects of pricing actions from 2011.�� Residential high-speed ARPC in
the first quarter of 2012 was up 7.7 per cent from the same quarter a
year earlier.
High-speed Internet customers reached 902,000 at the end of March 2012,
up 2.8 per cent from a year earlier. FibreOP Internet customers grew by 13,000 in the quarter to reach 59,000 at the
end of March 2012.��The majority of the FibreOP net adds were customers migrating from DSL and fibre-to-the-node
networks, which would not have contributed to overall high-speed
customer growth but increasingly contribute to improved customer
retention and growth in overall customer ARPC. Overall net high-speed
Internet customer additions of 6,400 in the first quarter of 2012 were
down from 8,500 in the first quarter of 2011, reflecting this
migration, lower high-speed Internet footprint expansion and continued
competitive activity.
IPTV revenue reached $17 million in the first quarter of 2012 with total
IPTV customers of 85,000 at the end of March 2012. FibreOP TV customers grew by 11,000 in the quarter to reach 52,000, a portion of
which were migrations from Bell Aliant TV. Overall net IPTV customer
additions were 8,000 in the first quarter of 2012, up from 4,000 in the
same quarter of 2011.
Other data revenue grew $2 million (2.1 per cent) in the first quarter
of 2012 from the same quarter a year earlier, continuing the improved
trends of recent quarters as a result of data demand growth.
Wireless revenues were up $3 million (13.3 per cent) driven by 8.9 per
cent customer growth and 4.1 per cent wireless ARPC growth compared to
a year ago as customers subscribe to higher value plans. Other revenues
also increased $3 million (6.8 per cent) in the first quarter compared
to a year ago, driven by higher product sales and increased pole
attachment fees.
Declared Dividends
Bell Aliant's Board of Directors today declared a quarterly dividend of
$0.4750 per common share, payable on June 29, 2012 to shareholders of
record at the close of business on June 15, 2012.
Bell Aliant Preferred Equity Inc. today declared a dividend on its
Series A Preferred Shares of $0.303125 per share and a dividend on its
Series C Preferred Shares of $0.284375 per share to be paid on June 29,
2012 to shareholders of record at the close of business on June 15,
2012.
Unless otherwise stated, dividends paid by Bell Aliant and Bell Aliant
Preferred Equity Inc. to Canadian residents are "eligible dividends" as
defined by the Canadian Income Tax Act and corresponding provincial
legislation.
Additional Information
More information on Bell Aliant's and Bell Aliant GP's first quarter
2012 results can be found in Bell Aliant's first quarter 2012
supplementary information package and Bell Aliant GP's first quarter
2012 MD&A, available at www.bellaliant.ca/investors.
Analyst Conference Call
A conference call with the financial community is scheduled for April
25, 2012, at 4:30 p.m. (EDT). The dial-in numbers are 866-226-1792 and
416-340-2216 for Toronto area participants. Media are invited to attend
in listen-only mode. A replay of the session can be heard until May 23,
2012. To access the replay, dial 800-408-3053 or 905-694-9451 and enter
the passcode 4028630.��
A live audio webcast of the conference call can be accessed on www.bellaliant.ca under the Investor Relations section. A replay of the conference call
will be available on the website for one year.
______________________________
1 See Notes section at the end of this release for definitions of the
non-International Financial Reporting Standard (IFRS) financial metrics
including EBITDA, free cash flow and adjusted earnings per share.��
Notes
The information contained in this news release is unaudited.
(1) | Bell Aliant derives virtually all of its income from its ownership in Bell Aliant GP. Bell Aliant GP's results consolidate the results of Bell Aliant Regional Communications, Limited Partnership; T��l��bec, Limited Partnership; NorthernTel, Limited Partnership; and Bell Aliant Preferred Equity Inc. | |
�� | �� | |
(2) | Percentage changes quoted in this release related to dollar values are based on amounts rounded to the nearest hundred-thousand, consistent with disclosure in Bell Aliant's supplementary information package and Bell Aliant GP's MD&As for the first quarter of 2012. Dollar values quoted in this release are rounded to the nearest million unless otherwise stated. | |
�� | �� | |
(3) | Definitions of non-IFRS measures: | |
�� | �� | |
�� | a. | EBITDA: Bell Aliant defines EBITDA as operating revenue less operating expenses (operating income) before interest, income taxes, depreciation and amortization expense, severance and other charges. |
�� | �� | �� |
�� | b. | Free cash flow: Bell Aliant defines free cash flow as cash generated from operating activities less capital expenditures. Free cash flow includes the operations of Bell Aliant and Bell Aliant GP on a combined basis. |
�� | �� | �� |
�� | c. | Adjusted earnings per share: Bell Aliant defines adjusted earnings per share as fully diluted earnings per share adjusted for the after-tax per share impact of amortizing purchase price allocations (amounts which represent the adjustments to historical cost of tangible and intangible assets acquired in business combinations). |
�� | �� | �� |
For a reconciliation of these non-IFRS measures to the most closely
comparable IFRS measures, please refer to Bell Aliant GP's MD&A for the
first quarter of 2012 available at www.bellaliant.ca/investors and www.sedar.com.
Forward-looking Information
This news release contains forward-looking statements concerning
anticipated future events, results, circumstances or expectations, in
particular statements concerning FTTH expansion plans and the financial
outlook for the coming quarters of 2012. Unless otherwise indicated,
such forward-looking statements describe management's expectations at
April 25, 2012. These statements are based on management's beliefs
regarding future events, many of which, by their nature are inherently
uncertain and beyond management's control. These statements are not
guarantees of future performance and are subject to assumptions which
may prove to be inaccurate and numerous risks and uncertainties which
are difficult to predict.
Bell Aliant encourages investors to review the risk factors section
below, and related disclosures, for a discussion of the various factors
that could cause actual results to differ from what is currently
expected.
Risk Factors
There are many factors that could cause results or events to differ
materially from current expectations. The most significant factors that
Bell Aliant has identified that may affect Bell Aliant's results or
events in 2012 include but are not limited to: increasing competition;
management's ability to achieve strategies and plans, including
expansion of our FTTH network and managing the cost structure; general
economic conditions; pension valuation and investment risk; reliance on
systems; changing technology; demand for our products and services; our
business relationship with BCE Inc. (BCE) and Bell Canada; changing
regulations; dependence on key suppliers; maintenance of credit
ratings; leverage and restrictive covenants; BCE's governance rights;
reliance on key personnel and labour relations; legal contingencies and
changes in laws; and tax related risks. Some of these risk factors are
largely beyond Bell Aliant's control. For additional information on
material factors and assumptions used to develop forward-looking
information and risk factors that could cause actual results to differ
materially from forward-looking information, see also the "Risks that
could affect our business and results" section of Bell Aliant Inc.'s
MD&A for the year ended December 31, 2011, and the "Assumptions made in
the preparation of forward-looking information" and "Risks that could
affect our business and results" sections of Bell Aliant GP's MD&A for
the year ended December 31, 2011, as updated by their first quarter
2012�� MD&As, as well as the "Risk Factors" sections of Bell Aliant
Inc.'s and Bell Aliant GP's 2011 Annual Information Forms. These
documents are available at www.bellaliant.ca and www.sedar.com.
Should any risk factor affect Bell Aliant in an unexpected manner, or
should assumptions underlying the forward-looking statements prove
incorrect, the actual results or events may differ materially from the
results or events predicted. Unless otherwise indicated,
forward-looking information does not take into account the effect that
transactions, or non-recurring or other special items, announced or
occurring after this information is provided, may have on the business.
All of the forward-looking information reflected in this press release
and the documents referred to within it are qualified by these
cautionary statements. There can be no assurance that the results or
developments anticipated by Bell Aliant will be realized or, even if
substantially realized, that they will have the expected consequences
for Bell Aliant.
Except as may be required by Canadian securities laws, Bell Aliant
disclaims any intention and assumes no obligation to update or revise
any forward-looking information, even if new information becomes
available as a result of future events or for any other reason. Readers
should not place undue reliance on any forward-looking information.
Forward-looking information is provided for the purpose of providing
information about management's current expectations and plans relating
to fiscal 2012 or other future periods. Readers are cautioned that such
information may not be appropriate for other purposes.
About Bell Aliant
Bell Aliant (TSX: BA) is one of North America's largest regional
communications providers and the first company in Canada to cover an
entire city with FTTH technology with its FibreOP services. Through its operating entities it serves customers in six
Canadian provinces with innovative information, communication and
technology services including voice, data, Internet, video and
value-added business solutions. Bell Aliant's employees deliver the
highest quality customer service, choice and convenience.
��
For further information:
Media Relations:
Sarah Levy MacLeod
(855) 487-5026
sarah.levy@bellaliant.ca
Investor Relations:
Zeda Redden
(877) 487-5726
zeda.redden@bellaliant.ca
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