BCE Inc. (BCE - Free Report) reported mixed second-quarter 2021 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same.
The Canada-based telecommunications and media company’s share price increased 1.6% on Aug 5, closing the session at $50.52.
Net Income
Net income (from continuing operations) in the June quarter jumped 194% year over year to C$685 million or C$0.76 per share. The increase resulted from higher adjusted EBITDA driven by improving consumer and commercial activity as the economy rebounds from COVID-19, lower non-cash media asset impairment charges and higher other income mainly due to net mark-to-market gains on derivatives used to economically hedge equity settled share-based compensation. This was partially offset by increased depreciation and amortization expenses as well as higher income taxes.
Adjusted net income came in at C$751 million ($611.3 million) or C$0.83 (68 cents) per share compared with C$573 million or C$0.63 per share in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 5 cents.
Revenues
Quarterly total operating revenues grew 6.4% year over year to C$5,698 million ($4,639 million). This comprises 5% higher service revenues of C$5,040 million and an 18.8% increase in product revenues to C$658 million. The result was driven by strong growth in wireless, residential Internet and media. The top line, however, missed the consensus estimate of $4,682 million.
Segment Results
Bell Wireless revenues increased 10.7% year over year to C$2,128 million, reflecting both higher service and product revenues. The company led all national players in wireless service revenue growth, which increased 5.8% to C$1,580 million. This resulted from healthy subscriber base growth, driven by its focus on higher-value smartphone loadings, demand for Bell’s IoT solutions and higher average revenue per mobile phone user. Product revenues were up 27.7% to C$548 million. This reflects increased customer transaction volumes, a greater sales mix of premium mobile phones and stronger consumer electronic sales at The Source as retail stores reopened.
Bell Wireline revenues slipped 1.3% year over year to C$3,003 million due to lower service and product revenues. Wireline service revenues were adversely impacted by a C$44 million regulatory charge between March 2016 and June 2021 related to the CRTC’s decision on final aggregated rates for wholesale Internet access, which resulted in a 0.9% year-over-year decrease to C$2,891 million. Product revenues fell 11.1% to C$112 million, mainly due to lower sales of data equipment to the government sector.
Bell Media generated revenues of C$755 million, up 30.4% year over year. The growth was driven by increased advertiser spending across TV, radio, out-of-home and digital media platforms.
Other Details
Overall, adjusted EBITDA was C$2,476 million, up 6.2% year over year. The rise was driven by increases at all Bell operating segments. Adjusted EBITDA margin was 43.5%, unchanged year over year.
Cash Flow & Liquidity
During the first half of 2021, BCE generated C$4,491 million of cash from operating activities compared with C$4,013 million in the prior-year period. Free cash flow was C$2,188 million compared with C$2,222 million a year ago.
As of Jun 30, 2021, the company had C$1,752 million ($1,413 million) in cash and cash equivalents with C$25,422 million ($20,507 million) of long-term debt.
2021 Outlook Reiterated
BCE has reiterated guidance for full-year 2021. It continues to expect revenues and adjusted EBITDA to grow between 2% and 5%. Adjusted earnings per share are estimated to grow between 1% and 6%. Free cash flow is projected in the range of C$2,850-C$3,200 million.
Zacks Rank & Stocks to Consider
BCE currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader sector are Clearfield, Inc. (CLFD - Free Report) , Juniper Networks, Inc. (JNPR - Free Report) and Qualcomm, Inc. (QCOM - Free Report) . While Clearfield carries a Zacks Rank #1 (Strong Buy), Juniper and Qualcomm carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Clearfield delivered a trailing four-quarter earnings surprise of 49%, on average.
Juniper pulled off a trailing four-quarter earnings surprise of 7.5%, on average.
Qualcomm delivered a trailing four-quarter earnings surprise of 13.5%, on average.
Conversion rate used:C$1 = $0.813942 (period average from Apr 1, 2021 to Jun 30, 2021)
C$1 = $0.806649 (as of Jun 30, 2021)
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BCE Inc. (BCE - Free Report) reported mixed second-quarter 2021 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same.
The Canada-based telecommunications and media company’s share price increased 1.6% on Aug 5, closing the session at $50.52.
Net Income
Net income (from continuing operations) in the June quarter jumped 194% year over year to C$685 million or C$0.76 per share. The increase resulted from higher adjusted EBITDA driven by improving consumer and commercial activity as the economy rebounds from COVID-19, lower non-cash media asset impairment charges and higher other income mainly due to net mark-to-market gains on derivatives used to economically hedge equity settled share-based compensation. This was partially offset by increased depreciation and amortization expenses as well as higher income taxes.
Adjusted net income came in at C$751 million ($611.3 million) or C$0.83 (68 cents) per share compared with C$573 million or C$0.63 per share in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 5 cents.
Revenues
Quarterly total operating revenues grew 6.4% year over year to C$5,698 million ($4,639 million). This comprises 5% higher service revenues of C$5,040 million and an 18.8% increase in product revenues to C$658 million. The result was driven by strong growth in wireless, residential Internet and media. The top line, however, missed the consensus estimate of $4,682 million.
Segment Results
Bell Wireless revenues increased 10.7% year over year to C$2,128 million, reflecting both higher service and product revenues. The company led all national players in wireless service revenue growth, which increased 5.8% to C$1,580 million. This resulted from healthy subscriber base growth, driven by its focus on higher-value smartphone loadings, demand for Bell’s IoT solutions and higher average revenue per mobile phone user. Product revenues were up 27.7% to C$548 million. This reflects increased customer transaction volumes, a greater sales mix of premium mobile phones and stronger consumer electronic sales at The Source as retail stores reopened.
Bell Wireline revenues slipped 1.3% year over year to C$3,003 million due to lower service and product revenues. Wireline service revenues were adversely impacted by a C$44 million regulatory charge between March 2016 and June 2021 related to the CRTC’s decision on final aggregated rates for wholesale Internet access, which resulted in a 0.9% year-over-year decrease to C$2,891 million. Product revenues fell 11.1% to C$112 million, mainly due to lower sales of data equipment to the government sector.
Bell Media generated revenues of C$755 million, up 30.4% year over year. The growth was driven by increased advertiser spending across TV, radio, out-of-home and digital media platforms.
Other Details
Overall, adjusted EBITDA was C$2,476 million, up 6.2% year over year. The rise was driven by increases at all Bell operating segments. Adjusted EBITDA margin was 43.5%, unchanged year over year.
Cash Flow & Liquidity
During the first half of 2021, BCE generated C$4,491 million of cash from operating activities compared with C$4,013 million in the prior-year period. Free cash flow was C$2,188 million compared with C$2,222 million a year ago.
As of Jun 30, 2021, the company had C$1,752 million ($1,413 million) in cash and cash equivalents with C$25,422 million ($20,507 million) of long-term debt.
2021 Outlook Reiterated
BCE has reiterated guidance for full-year 2021. It continues to expect revenues and adjusted EBITDA to grow between 2% and 5%. Adjusted earnings per share are estimated to grow between 1% and 6%. Free cash flow is projected in the range of C$2,850-C$3,200 million.
Zacks Rank & Stocks to Consider
BCE currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader sector are Clearfield, Inc. (CLFD - Free Report) , Juniper Networks, Inc. (JNPR - Free Report) and Qualcomm, Inc. (QCOM - Free Report) . While Clearfield carries a Zacks Rank #1 (Strong Buy), Juniper and Qualcomm carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Clearfield delivered a trailing four-quarter earnings surprise of 49%, on average.
Juniper pulled off a trailing four-quarter earnings surprise of 7.5%, on average.
Qualcomm delivered a trailing four-quarter earnings surprise of 13.5%, on average.
Conversion rate used:
C$1 = $0.813942 (period average from Apr 1, 2021 to Jun 30, 2021)
C$1 = $0.806649 (as of Jun 30, 2021)
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How To Profit From Trillions On Spending For Infrastructure >>
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