Q4 2005 Q4 2004 2005 2004
-------------------------------------------------------------------------
Cash from operating activities 1,585 1,279 5,559 5,443
Capital expenditures (831) (1,043) (3,428) (3,319)
Total dividends paid (363) (347) (1,473) (1,381)
Other investing activities 32 (10) 4 127
-------------------------------------------------------------------------
Free cash flow 423 (121) 662 870
Restructuring and other items 23 126 55 1,224
-------------------------------------------------------------------------
Free cash flow before
restructuring and other items 446 5 717 2,094
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Supplementary Financial Information
BCE Consolidated (1)
Consolidated Operational Data
($ millions,
except per
share Q4 Q4 $ % Total Total $ %
amounts) 2005 2004 change change 2005 2004 change change
-------------------------------------------------------------------------
Operating
revenues 4,986 4,769 217 4.6% 19,105 18,368 737 4.0%
Operating
expenses (3,128) (2,975) (153) (5.1%) (11,508)(10,938) (570) (5.2%)
-------------------------------------------------------------------------
EBITDA(2) 1,858 1,794 64 3.6% 7,597 7,430 167 2.2%
EBITDA
margin(3) 37.3% 37.6% (0.3)pts 39.8% 40.5% (0.7)pts
Amortization
expense (791) (787) (4) (0.5%) (3,114) (3,056) (58) (1.9%)
Net benefit
plans cost (65) (67) 2 3.0% (380) (256) (124) (48.4%)
Restructuring
and other
items (23) (126) 103 81.7% (55) (1,224) 1,169 95.5%
-------------------------------------------------------------------------
Operating
income 979 814 165 20.3% 4,048 2,894 1,154 39.9%
Other income (17) 17 (34) n.m. 8 407 (399) (98.0%)
Interest
expense (246) (244) (2) (0.8%) (981) (999) 18 1.8%
-------------------------------------------------------------------------
Pre-tax
earnings
from
continuing
operations 716 587 129 22.0% 3,075 2,302 773 33.6%
Income taxes (224) (193) (31)(16.1%) (893) (681) (212) (31.1%)
Non-controlling
interest (74) (40) (34)(85.0%) (267) (174) (93) (53.4%)
-------------------------------------------------------------------------
Earnings
from
continuing
operations 418 354 64 18.1% 1,915 1,447 468 32.3%
Discontinued
operations 12 11 1 9.1% 46 77 (31) (40.3%)
-------------------------------------------------------------------------
Net earnings
before
extraordinary
gain 430 365 65 17.8% 1,961 1,524 437 28.7%
Extraordinary
gain - 69 (69)(100.0%) - 69 (69)(100.0%)
-------------------------------------------------------------------------
Net earnings 430 434 (4) (0.9%) 1,961 1,593 368 23.1%
Dividends on
preferred
shares (17) (17) - 0.0% (70) (70) - 0.0%
-------------------------------------------------------------------------
Net earnings
applicable
to common
shares 413 417 (4) (1.0%) 1,891 1,523 368 24.2%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net earnings
per common
share - basic
Continuing
opera-
tions $ 0.43 $ 0.37 $ 0.06 16.2% $ 1.99 $ 1.49 $ 0.50 33.6%
Discon-
tinued
opera-
tions $ 0.01 $ 0.01 $ - 0.0% $ 0.05 $ 0.09 $(0.04) (44.4%)
Extraordinary
gain $ - $ 0.07 $(0.07)(100.0%) $ - $ 0.07 $(0.07)(100.0%)
Net
earnings $ 0.44 $ 0.45 $(0.01) (2.2%) $ 2.04 $ 1.65 $ 0.39 23.6%
Net earnings
per common
share -
diluted
Continuing
opera-
tions $ 0.43 $ 0.37 $ 0.06 16.2% $ 1.99 $ 1.49 $ 0.50 33.6%
Discon-
tinued
opera-
tions $ 0.01 $ 0.01 $ - 0.0% $ 0.05 $ 0.09 $(0.04) (44.4%)
Extraordinary
gain $ - $ 0.07 $(0.07)(100.0%) $ - $ 0.07 $(0.07)(100.0%)
Net
earnings $ 0.44 $ 0.45 $(0.01) (2.2%) $ 2.04 $ 1.65 $ 0.39 23.6%
Dividends
per common
share $ 0.33 $ 0.30 $ 0.03 10.0% $ 1.32 $ 1.20 $ 0.12 10.0%
Average
number of
common
shares
outstanding -
basic
(millions) 927.3 925.3 926.8 924.6
-------------------------------------------------------------------------
-------------------------------------------------------------------------
The following
items are
included in
net earnings:
Net gains
(losses) on
investments
Continuing
opera-
tions - 64 29 389
Discon-
tinued
opera-
tions - (2) (1) 34
Restructuring
and other
items (16) (62) (38) (772)
-------------------------------------------------------------------------
Total (16) - (10) (349)
Impact on
net earnings
per share $(0.02) $ - $(0.01) $(0.37)
-------------------------------------------------------------------------
EPS before
net
gains
(losses) on
investments
and
restructuring
and other
items(2) $ 0.46 $ 0.45 $ 0.01 2.2% $ 2.05 $ 2.02 $ 0.03 1.5%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
n.m.: not meaningful
BCE Consolidated (1)
Consolidated Operational Data - Historical Trend
($ millions, except Total
per share amounts) 2005 Q4 05 Q3 05 Q2 05 Q1 05
-------------------------------------------------------------------------
Operating revenues 19,105 4,986 4,732 4,757 4,630
Operating expenses (11,508) (3,128) (2,868) (2,785) (2,727)
-------------------------------------------------------------------------
EBITDA(2) 7,597 1,858 1,864 1,972 1,903
EBITDA margin(3) 39.8% 37.3% 39.4% 41.5% 41.1%
Amortization
expense (3,114) (791) (786) (776) (761)
Net benefit plans
cost (380) (65) (108) (104) (103)
Restructuring and
other items (55) (23) (31) (5) 4
-------------------------------------------------------------------------
Operating income 4,048 979 939 1,087 1,043
Other income 8 (17) (2) 19 8
Interest expense (981) (246) (245) (245) (245)
-------------------------------------------------------------------------
Pre-tax earnings
from continuing
operations 3,075 716 692 861 806
Income taxes (893) (224) (187) (218) (264)
Non-controlling
interest (267) (74) (57) (73) (63)
-------------------------------------------------------------------------
Earnings from
continuing
operations 1,915 418 448 570 479
Discontinued
operations 46 12 11 11 12
-------------------------------------------------------------------------
Net earnings before
extraordinary gain 1,961 430 459 581 491
Extraordinary gain - - - - -
-------------------------------------------------------------------------
Net earnings 1,961 430 459 581 491
Dividends on
preferred shares (70) (17) (18) (18) (17)
-------------------------------------------------------------------------
Net earnings
applicable to
common shares 1,891 413 441 563 474
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net earnings per
common share - basic
Continuing
operations $ 1.99 $ 0.43 $ 0.46 $ 0.60 $ 0.50
Discontinued
operations $ 0.05 $ 0.01 $ 0.02 $ 0.01 $ 0.01
Extraordinary
gain $ - $ - $ - $ - $ -
Net earnings $ 2.04 $ 0.44 $ 0.48 $ 0.61 $ 0.51
Net earnings per
common share -
diluted
Continuing
operations $ 1.99 $ 0.43 $ 0.46 $ 0.60 $ 0.50
Discontinued
operations $ 0.05 $ 0.01 $ 0.02 $ 0.01 $ 0.01
Extraordinary
gain $ - $ - $ - $ - $ -
Net earnings $ 2.04 $ 0.44 $ 0.48 $ 0.61 $ 0.51
Dividends per
common share $ 1.32 $ 0.33 $ 0.33 $ 0.33 $ 0.33
Average number of
common shares
outstanding -
basic (millions) 926.8 927.3 927.0 926.6 926.2
-------------------------------------------------------------------------
-------------------------------------------------------------------------
The following items
are included in
net earnings:
Net gains (losses)
on investments
Continuing
operations 29 - - 28 1
Discontinued
operations (1) - - - (1)
Restructuring and
other items (38) (16) (21) (3) 2
-------------------------------------------------------------------------
Total (10) (16) (21) 25 2
Impact on net
earnings per share $(0.01) $(0.02) $(0.02) $0.03 $ -
-------------------------------------------------------------------------
EPS before net
gains (losses) on
investments and
restructuring and
other items(2) $ 2.05 $ 0.46 $ 0.50 $ 0.58 $ 0.51
-------------------------------------------------------------------------
-------------------------------------------------------------------------
($ millions, except Total
per share amounts) 2004 Q4 04 Q3 04 Q2 04 Q1 04
-------------------------------------------------------------------------
Operating revenues 18,368 4,769 4,556 4,577 4,466
Operating expenses (10,938) (2,975) (2,655) (2,657) (2,651)
-------------------------------------------------------------------------
EBITDA(2) 7,430 1,794 1,901 1,920 1,815
EBITDA margin(3) 40.5% 37.6% 41.7% 41.9% 40.6%
Amortization
expense (3,056) (787) (754) (757) (758)
Net benefit plans
cost (256) (67) (61) (65) (63)
Restructuring and
other items (1,224) (126) (1,081) (14) (3)
-------------------------------------------------------------------------
Operating income 2,894 814 5 1,084 991
Other income 407 17 332 23 35
Interest expense (999) (244) (252) (253) (250)
-------------------------------------------------------------------------
Pre-tax earnings
from continuing
operations 2,302 587 85 854 776
Income taxes (681) (193) 52 (286) (254)
Non-controlling
interest (174) (40) (47) (39) (48)
-------------------------------------------------------------------------
Earnings from
continuing
operations 1,447 354 90 529 474
Discontinued
operations 77 11 10 42 14
-------------------------------------------------------------------------
Net earnings before
extraordinary gain 1,524 365 100 571 488
Extraordinary gain 69 69 - - -
-------------------------------------------------------------------------
Net earnings 1,593 434 100 571 488
Dividends on
preferred shares (70) (17) (18) (17) (18)
-------------------------------------------------------------------------
Net earnings
applicable to
common shares 1,523 417 82 554 470
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net earnings per
common share -
basic
Continuing
operations $ 1.49 $ 0.37 $ 0.08 $ 0.55 $ 0.49
Discontinued
operations $ 0.09 $ 0.01 $ 0.01 $ 0.05 $ 0.02
Extraordinary
gain $ 0.07 $ 0.07 $ - $ - $ -
Net earnings $ 1.65 $ 0.45 $ 0.09 $ 0.60 $ 0.51
Net earnings per
common share -
diluted
Continuing
operations $ 1.49 $ 0.37 $ 0.08 $ 0.55 $ 0.49
Discontinued
operations $ 0.09 $ 0.01 $ 0.01 $ 0.05 $ 0.02
Extraordinary
gain $ 0.07 $ 0.07 $ - $ - $ -
Net earnings $ 1.65 $ 0.45 $ 0.09 $ 0.60 $ 0.51
Dividends per
common share $ 1.20 $ 0.30 $ 0.30 $ 0.30 $ 0.30
Average number of
common shares
outstanding -
basic (millions) 924.6 925.3 924.6 924.3 924.1
-------------------------------------------------------------------------
-------------------------------------------------------------------------
The following items
are included in
net earnings:
Net gains (losses)
on investments
Continuing
operations 389 64 325 - -
Discontinued
operations 34 (2) (2) 31 7
Restructuring and
other items (772) (62) (725) 16 (1)
-------------------------------------------------------------------------
Total (349) - (402) 47 6
Impact on net
earnings per share $(0.37) $ - $(0.43) $ 0.05 $ 0.01
-------------------------------------------------------------------------
EPS before net
gains (losses) on
investments and
restructuring and
other items(2) $ 2.02 $ 0.45 $ 0.52 $ 0.55 $ 0.50
-------------------------------------------------------------------------
-------------------------------------------------------------------------
BCE Consolidated(1)
Segmented Data
($ millions,
except where
otherwise Q4 Q4 $ % Total Total $ %
indicated) 2005 2004 change change 2005 2004 change change
-------------------------------------------------------------------------
Revenues
Residential 1,924 1,911 13 0.7% 7,599 7,502 97 1.3%
Business 1,627 1,535 92 6.0% 6,120 5,851 269 4.6%
Aliant 535 506 29 5.7% 2,097 2,033 64 3.1%
Other Bell
Canada 494 511 (17) (3.3) 1,958 1,939 19 1.0%
Inter-
segment
eliminations (123) (160) 37 23.1% (524) (538) 14 2.6%
-------------------------------------------------------------------------
Total Bell
Canada 4,457 4,303 154 3.6% 17,250 16,787 463 2.8%
Other BCE
Bell
Globemedia 465 405 60 14.8% 1,555 1,420 135 9.5%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Advertising 354 306 48 15.7% 1,148 1,041 107 10.3%
Subscriber 86 77 9 11.7% 320 298 22 7.4%
Production
and Sundry 25 22 3 13.6% 87 81 6 7.4%
-------------------------------------------------------------------------
Telesat 118 102 16 15.7% 475 362 113 31.2%
Other 13 19 (6) (31.6%) 63 60 3 5.0%
-------------------------------------------------------------------------
Total Other BCE 596 526 70 13.3% 2,093 1,842 251 13.6%
Inter-segment
eliminations (67) (60) (7) (11.7%) (238) (261) 23 8.8%
-------------------------------------------------------------------------
Total revenues 4,986 4,769 217 4.6% 19,105 18,368 737 4.0%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Operating income
Residential 444 464 (20) (4.3%) 2,001 2,119 (118)(5.6%)
Business 236 183 53 29.0% 910 896 14 1.6%
Aliant 105 23 82 n.m. 396 268 128 47.8%
Other Bell
Canada 99 61 38 62.3% 448 (588) 1,036 n.m.
-------------------------------------------------------------------------
Total Bell
Canada 884 731 153 20.9% 3,755 2,695 1,060 39.3%
Other BCE
Bell
Globemedia 101 103 (2) (1.9%) 289 240 49 20.4%
Telesat 34 37 (3) (8.1%) 157 141 16 11.3%
Other (40) (57) 17 29.8% (153) (182) 29 15.9%
-------------------------------------------------------------------------
Total Other BCE 95 83 12 14.5% 293 199 94 47.2%
-------------------------------------------------------------------------
Total operating
income 979 814 165 20.3% 4,048 2,894 1,154 39.9%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Capital
expenditures(4)
Residential 350 418 68 16.3% 1,519 1,371 (148)(10.8%)
Business 206 330 124 37.6% 897 1,008 111 11.0%
Aliant 77 114 37 32.5% 363 295 (68)(23.1%)
Other Bell
Canada 103 123 20 16.3% 343 352 9 2.6%
-------------------------------------------------------------------------
Total Bell
Canada 736 985 249 25.3% 3,122 3,026 (96)(3.2%)
Other BCE
Telesat 62 40 (22) (55.0%) 260 257 (3)(1.2%)
Other 33 18 (15) (83.3%) 46 36 (10)(27.8%)
-------------------------------------------------------------------------
Total capital
expenditures 831 1,043 212 20.3% 3,428 3,319 (109)(3.3%)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
n.m.: not meaningful
BCE Consolidated(1)
Segmented Data - Historical Trend
($ millions, except
where otherwise Total
indicated) 2005 Q4 05 Q3 05 Q2 05 Q1 05
-------------------------------------------------------------------------
Revenues
Residential 7,599 1,924 1,929 1,890 1,856
Business 6,120 1,627 1,516 1,499 1,478
Aliant 2,097 535 520 518 524
Other Bell Canada 1,958 494 500 485 479
Inter-segment
eliminations (524) (123) (139) (134) (128)
-------------------------------------------------------------------------
Total Bell
Canada 17,250 4,457 4,326 4,258 4,209
Other BCE
Bell Globemedia 1,555 465 335 399 356
-------------------------------------------------------------------------
Advertising 1,148 354 233 300 261
Subscriber 320 86 79 78 77
Production and
Sundry 87 25 23 21 18
-------------------------------------------------------------------------
Telesat 475 118 112 137 108
Other 63 13 15 24 11
-------------------------------------------------------------------------
Total Other BCE 2,093 596 462 560 475
Inter-segment
eliminations (238) (67) (56) (61) (54)
-------------------------------------------------------------------------
Total revenues 19,105 4,986 4,732 4,757 4,630
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Operating income
Residential 2,001 444 479 552 526
Business 910 236 213 221 240
Aliant 396 105 105 99 87
Other Bell Canada 448 99 111 109 129
-------------------------------------------------------------------------
Total Bell Canada 3,755 884 908 981 982
Other BCE
Bell Globemedia 289 101 29 95 64
Telesat 157 34 43 43 37
Other (153) (40) (41) (32) (40)
-------------------------------------------------------------------------
Total Other BCE 293 95 31 106 61
-------------------------------------------------------------------------
Total operating
income 4,048 979 939 1,087 1,043
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Capital
expenditures(4)
Residential 1,519 350 434 394 341
Business 897 206 249 246 196
Aliant 363 77 100 104 82
Other Bell
Canada 343 103 90 103 47
-------------------------------------------------------------------------
Total Bell
Canada 3,122 736 873 847 666
Other BCE
Telesat 260 62 91 53 54
Other 46 33 4 5 4
-------------------------------------------------------------------------
Total capital
expenditures 3,428 831 968 905 724
-------------------------------------------------------------------------
-------------------------------------------------------------------------
BCE Consolidated(1)
Segmented Data - Historical Trend
($ millions, except
where otherwise Total
indicated) 2004 Q4 04 Q3 04 Q2 04 Q1 04
-------------------------------------------------------------------------
Revenues
Residential 7,502 1,911 1,908 1,858 1,825
Business 5,851 1,535 1,440 1,441 1,435
Aliant 2,033 506 497 526 504
Other Bell Canada 1,939 511 486 468 474
Inter-segment
eliminations (538) (160) (125) (121) (132)
-------------------------------------------------------------------------
Total Bell
Canada 16,787 4,303 4,206 4,172 4,106
Other BCE
Bell Globemedia 1,420 405 302 371 342
-------------------------------------------------------------------------
Advertising 1,041 306 209 277 249
Subscriber 298 77 73 74 74
Production
and Sundry 81 22 20 20 19
-------------------------------------------------------------------------
Telesat 362 102 91 85 84
Other 60 19 12 19 10
-------------------------------------------------------------------------
Total Other BCE 1,842 526 405 475 436
Inter-segment
eliminations (261) (60) (55) (70) (76)
-------------------------------------------------------------------------
Total revenues 18,368 4,769 4,556 4,577 4,466
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Operating income
Residential 2,119 464 569 560 526
Business 896 183 245 227 241
Aliant 268 23 71 92 82
Other Bell Canada (588) 61 (898) 138 111
-------------------------------------------------------------------------
Total Bell Canada 2,695 731 (13) 1,017 960
Other BCE
Bell Globemedia 240 103 23 74 40
Telesat 141 37 39 34 31
Other (182) (57) (44) (41) (40)
-------------------------------------------------------------------------
Total Other BCE 199 83 18 67 31
-------------------------------------------------------------------------
Total operating
income 2,894 814 5 1,084 991
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Capital
expenditures(4)
Residential 1,371 418 377 331 245
Business 1,008 330 183 281 214
Aliant 295 114 51 45 85
Other Bell Canada 352 123 125 58 46
-------------------------------------------------------------------------
Total Bell
Canada 3,026 985 736 715 590
Other BCE
Telesat 257 40 64 88 65
Other 36 18 5 9 4
-------------------------------------------------------------------------
Total capital
expenditures 3,319 1,043 805 812 659
-------------------------------------------------------------------------
-------------------------------------------------------------------------
BCE Consolidated(1)
Consolidated Balance Sheet Data
($ millions,
except where December September June March December
otherwise 31 30 30 31 31
indicated) 2005 2005 2005 2005 2004
-------------------------------------------------------------------------
ASSETS
Current assets
Cash and cash
equivalents 363 415 332 482 313
Accounts
receivable 1,766 1,806 1,728 1,914 1,951
Other current
assets 1,142 1,333 1,060 1,205 1,061
Current assets
of discontinued
operations 402 378 369 368 383
-------------------------------------------------------------------------
Total current assets 3,673 3,932 3,489 3,969 3,708
Capital assets 22,062 21,941 21,761 21,087 21,104
Other long-term
assets 2,914 2,667 2,667 2,720 2,628
Indefinite-life
intangible assets 3,031 2,973 2,973 2,951 2,916
Goodwill 7,887 7,900 7,854 7,814 7,756
Non-current assets
of discontinued
operations 1,063 1,073 1,070 1,034 1,028
-------------------------------------------------------------------------
Total assets 40,630 40,486 39,814 39,575 39,140
-------------------------------------------------------------------------
-------------------------------------------------------------------------
LIABILITIES
Current liabilities
Accounts payable
and accrued
liabilities 3,435 3,287 3,060 3,052 3,444
Interest payable 182 266 189 283 183
Dividends payable 343 325 325 325 297
Debt due within
one year 1,373 1,260 1,494 1,423 1,272
Current liabilities
of discontinued
operations 281 279 280 272 271
-------------------------------------------------------------------------
Total current
liabilities 5,614 5,417 5,348 5,355 5,467
Long-term debt 12,119 12,558 12,407 12,185 11,685
Other long-term
liabilities 5,028 4,758 4,506 4,718 4,834
Non-current
liabilities of
discontinued
operations 250 251 170 195 222
-------------------------------------------------------------------------
Total liabilities 23,011 22,984 22,431 22,453 22,208
-------------------------------------------------------------------------
Non-controlling
interest 2,898 2,892 2,905 2,914 2,908
-------------------------------------------------------------------------
-------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Preferred shares 1,670 1,670 1,670 1,670 1,670
-------------------------------------------------------------------------
Common shareholders'
equity
Common shares 16,806 16,806 16,794 16,790 16,781
Contributed
surplus 1,081 1,076 1,071 1,065 1,061
Deficit (4,763) (4,871) (5,005) (5,264) (5,432)
Currency
translation
adjustment (73) (71) (52) (53) (56)
-------------------------------------------------------------------------
Total common
shareholders'
equity 13,051 12,940 12,808 12,538 12,354
-------------------------------------------------------------------------
Total
shareholders'
equity 14,721 14,610 14,478 14,208 14,024
-------------------------------------------------------------------------
Total liabilities
and shareholders'
equity 40,630 40,486 39,814 39,575 39,140
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Number of common
shares
outstanding 927.3 927.3 926.7 926.4 925.9
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total Net Debt 13,129 13,403 13,569 13,126 12,644
Total
Capitalization 30,748 30,905 30,952 30,248 29,576
Key ratios
Net debt: Total
Capitalization 42.7% 43.4% 43.8% 43.4% 42.8%
Net debt: Trailing
12 month EBITDA 1.73 1.78 1.79 1.75 1.70
EBITDA: Interest
(trailing 12 month) 7.74 7.69 7.68 7.56 7.44
BCE Consolidated
Consolidated Cash Flow Data
($ millions,
except where
otherwise Q4 Q4 Total Total
indicated) 2005 2004 $ change 2005 2004 $ change
-------------------------------------------------------------------------
Cash flows from
operating activities
Earnings from
continuing
operations 418 354 64 1,915 1,447 468
Adjustments to
reconcile earnings
from continuing
operations to cash
flows from
operating
activities:
Amortization
expense 791 787 4 3,114 3,056 58
Net benefit plans
cost 65 67 (2) 380 256 124
Restructuring and
other items 23 126 (103) 55 1,224 (1,169)
Net gains on
investments 1 12 (11) (33) (320) 287
Future income
taxes 465 62 403 746 (35) 781
Non-controlling
interest 74 40 34 267 174 93
Contributions to
employee
pension plans (65) (24) (41) (226) (112) (114)
Other employee
future benefit
plan payments (24) (22) (2) (93) (81) (12)
Payments of
restructuring
and other items (23) (214) 191 (176) (253) 77
Operating assets
and liabilities (140) 91 (231) (390) 87 (477)
-------------------------------------------------------------------------
1,585 1,279 306 5,559 5,443 116
-------------------------------------------------------------------------
Capital
expenditures (831) (1,043) 212 (3,428) (3,319) (109)
Other investing
activities 32 (10) 42 4 127 (123)
Cash dividends
paid on preferred
shares (22) (21) (1) (86) (85) (1)
Cash dividends
paid by
subsidiaries to
non-controlling
interest (35) (49) 14 (192) (188) (4)
-------------------------------------------------------------------------
Free Cash Flow
from operations,
before common
dividends(2) 729 156 573 1,857 1,978 (121)
Cash dividends paid
on common shares (306) (277) (29) (1,195) (1,108) (87)
-------------------------------------------------------------------------
Free Cash Flow from
operations, after
common dividends(2) 423 (121) 544 662 870 (208)
Business
acquisitions (50) (334) 284 (228) (1,118) 890
Business
dispositions - - - - 20 (20)
Increase in
investments (17) (38) 21 (233) (58) (175)
Decrease in
investments 12 - 12 19 713 (694)
-------------------------------------------------------------------------
Free Cash Flow
after investments
and divestitures 368 (493) 861 220 427 (207)
-------------------------------------------------------------------------
Other financing
activities
Increase (decrease)
in notes payable
and bank advances (187) 7 (194) (66) 130 (196)
Issue of long-term
debt - 56 (56) 1,190 1,306 (116)
Repayment of
long-term debt (196) (580) 384 (1,178) (2,256) 1,078
Issue of common
shares - 16 (16) 25 32 (7)
Issue of equity
securities by
subsidiaries to
non-controlling
interest - 1 (1) 1 8 (7)
Redemption of
equity securities
by subsidiaries
from non-controlling
interest (18) - (18) (78) (58) (20)
Other financing
activities (19) (18) (1) (64) (81) 17
-------------------------------------------------------------------------
(420) (518) 98 (170) (919) 749
-------------------------------------------------------------------------
Cash provided by
(used in) continuing
operations (52) (1,011) 959 50 (492) 542
Cash provided by
(used in) discontinued
operations 22 5 17 15 150 (135)
-------------------------------------------------------------------------
Net increase
(decrease) in cash
and cash equivalents (30) (1,006) 976 65 (342) 407
Cash and cash
equivalents at
beginning of period 475 1,386 (911) 380 722 (342)
-------------------------------------------------------------------------
Cash and cash
equivalents at end
of period 445 380 65 445 380 65
-------------------------------------------------------------------------
Consists of:
Cash and cash
equivalents
of continuing
operations 363 313 50 363 313 50
Cash and cash
equivalents
of discontinued
operations 82 67 15 82 67 15
-------------------------------------------------------------------------
Total 445 380 65 445 380 65
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other information
Capital expenditures
as a percentage of
revenues 16.7% 21.9% 5.2pts 17.9% 18.1% 0.2 pts
Cash flow per
share(5) $0.81 $0.26 $0.55 $2.30 $2.30 $0.00
Annualized cash
flow yield(6) 11.3% 2.3% 9.0pts 7.2% 7.4% (0.2)pts
Common dividend
payout 74.1% 66.4% 7.7pts 63.2% 72.8% (9.6)pts
BCE Consolidated
Consolidated Cash Flow Data - Historical Trend
($ millions,
except where Total
otherwise
indicated) 2005 Q4 05 Q3 05 Q2 05 Q1 05
-------------------------------------------------------------------------
Cash flows from
operating activities
Earnings from
continuing
operations 1,915 418 448 570 479
Adjustments to
reconcile earnings
from continuing
operations to
cash flows from
operating
activities:
Amortization
expense 3,114 791 786 776 761
Net benefit
plans cost 380 65 108 104 103
Restructuring
and other items 55 23 31 5 (4)
Net (gains)
losses on
investments (33) 1 - (32) (2)
Future income
taxes 746 465 111 63 107
Non-controlling
interest 267 74 57 73 63
Contributions to
employee pension
plans (226) (65) (33) (34) (94)
Other employee
future benefit
plan payments (93) (24) (24) (22) (23)
Payments of
restructuring
and other items (176) (23) (24) (28) (101)
Operating assets
and liabilities (390) (140) 195 (72) (373)
-------------------------------------------------------------------------
5,559 1,585 1,655 1,403 916
-------------------------------------------------------------------------
Capital
expenditures (3,428) (831) (968) (905) (724)
Other investing
activities 4 32 (3) (10) (15)
Cash dividends
paid on preferred
shares (86) (22) (21) (22) (21)
Cash dividends
paid by
subsidiaries to
non-controlling
interest (192) (35) (47) (60) (50)
-------------------------------------------------------------------------
Free Cash Flow
from operations,
before common
dividends(2) 1,857 729 616 406 106
Cash dividends
paid on common
shares (1,195) (306) (306) (305) (278)
-------------------------------------------------------------------------
Free Cash Flow
from operations,
after common
dividends(2) 662 423 310 101 (172)
Business
acquisitions (228) (50) (56) (35) (87)
Business
dispositions - - - - -
Increase in
investments (233) (17) (75) (13) (128)
Decrease in
investments 19 12 - 5 2
-------------------------------------------------------------------------
Free Cash Flow
after investments
and divestitures 220 368 179 58 (385)
-------------------------------------------------------------------------
Other financing
activities
Increase
(decrease)
in notes
payable and
bank advances (66) (187) (65) 341 (155)
Issue of
long-term debt 1,190 - 200 205 785
Repayment of
long-term debt (1,178) (196) (209) (719) (54)
Issue of common
shares 25 - 12 4 9
Issue of equity
securities and
convertible
debentures by
subsidiaries to
non-controlling
interest 1 - 1 - -
Redemption
of equity
securities by
subsidiaries from
non-controlling
interest (78) (18) (22) (21) (17)
Other financing
activities (64) (19) (13) (18) (14)
-------------------------------------------------------------------------
(170) (420) (96) (208) 554
-------------------------------------------------------------------------
Cash provided by
(used in)
continuing
operations 50 (52) 83 (150) 169
Cash provided by
(used in)
discontinued
operations 15 22 12 4 (23)
-------------------------------------------------------------------------
Net increase
(decrease) in
cash and cash
equivalents 65 (30) 95 (146) 146
Cash and cash
equivalents at
beginning of period 380 475 380 526 380
-------------------------------------------------------------------------
Cash and cash
equivalents at end
of period 445 445 475 380 526
-------------------------------------------------------------------------
Consists of:
Cash and cash
equivalents of
continuing
operations 363 363 415 332 482
Cash and cash
equivalents of
discontinued
operations 82 82 60 48 44
-------------------------------------------------------------------------
Total 445 445 475 380 526
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other information
Capital expenditures
as a percentage
of revenues 17.9% 16.7% 20.5% 19.0% 15.6%
Cash flow per
share(5) $2.30 $0.81 $0.74 $0.54 $0.21
Annualized cash
flow yield(6) 7.2% 11.3% 8.3% 6.0% 1.5%
Common dividend
payout 63.2% 74.1% 69.4% 54.2% 58.6%
($ millions,
except where Total
otherwise
indicated) 2004 Q4 04 Q3 04 Q2 04 Q1 04
-------------------------------------------------------------------------
Cash flows from
operating activities
Earnings from
continuing
operations 1,447 354 90 529 474
Adjustments to
reconcile earnings
from continuing
operations to
cash flows from
operating
activities:
Amortization
expense 3,056 787 754 757 758
Net benefit
plans cost 256 67 61 65 63
Restructuring
and other items 1,224 126 1,081 14 3
Net (gains)
losses on
investments (320) 12 (327) - (5)
Future income
taxes (35) 62 (184) 34 53
Non-controlling
interest 174 40 47 39 48
Contributions to
employee pension
plans (112) (24) (32) (27) (29)
Other employee
future benefit
plan payments (81) (22) (13) (22) (24)
Payments of
restructuring
and other items (253) (214) (12) (8) (19)
Operating assets
and liabilities 87 91 368 (284) (88)
-------------------------------------------------------------------------
5,443 1,279 1,833 1,097 1,234
-------------------------------------------------------------------------
Capital
expenditures (3,319) (1,043) (805) (812) (659)
Other investing
activities 127 (10) (2) 120 19
Cash dividends
paid on preferred
shares (85) (21) (21) (21) (22)
Cash dividends
paid by
subsidiaries to
non-controlling
interest (188) (49) 44) (52) (43)
-------------------------------------------------------------------------
Free Cash Flow
from operations,
before common
dividends(2) 1,978 156 961 332 529
Cash dividends
paid on common
shares (1,108) (277) (277) (277) (277)
-------------------------------------------------------------------------
Free Cash Flow
from operations,
after common
dividends(2) 870 (121) 684 55 252
Business
acquisitions (1,118) (334) (646) (79) (59)
Business
dispositions 20 - 4 - 16
Increase in
investments (58) (38) (12) (8) -
Decrease in
investments 713 - 707 - 6
-------------------------------------------------------------------------
Free Cash Flow
after investments
and divestitures 427 (493) 737 (32) 215
-------------------------------------------------------------------------
Other financing
activities
Increase
(decrease)
in notes
payable and
bank advances 130 7 173 (69) 19
Issue of
long-term debt 1,306 56 11 1 1,238
Repayment of
long-term debt (2,256) (580) (98) (714) (864)
Issue of common
shares 32 16 8 4 4
Issue of equity
securities and
convertible
debentures by
subsidiaries to
non-controlling
interest 8 1 - - 7
Redemption
of equity
securities by
subsidiaries from
non-controlling
interest (58) - (4) (12) (42)
Other financing
activities (81) (18) (18) 3 (48)
-------------------------------------------------------------------------
(919) (518) 72 (787) 314
-------------------------------------------------------------------------
Cash provided by
(used in)
continuing
operations (492) (1,011) 809 (819) 529
Cash provided by
(used in)
discontinued
operations 150 5 - (115) 260
-------------------------------------------------------------------------
Net increase
(decrease) in
cash and cash
equivalents (342) (1,006) 809 (934) 789
Cash and cash
equivalents at
beginning of period 722 1,386 577 1,511 722
-------------------------------------------------------------------------
Cash and cash
equivalents at end
of period 380 380 1,386 577 1,511
-------------------------------------------------------------------------
Consists of:
Cash and cash
equivalents of
continuing
operations 313 313 1,327 521 1,085
Cash and cash
equivalents of
discontinued
operations 67 67 59 56 426
-------------------------------------------------------------------------
Total 380 380 1,386 577 1,511
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other information
Capital expenditures
as a percentage
of revenues 18.1% 21.9% 17.7% 17.7% 14.8%
Cash flow per
share(5) $2.30 $0.26 $1.11 $0.31 $0.62
Annualized cash
flow yield(6) 7.4% 2.3% 15.3% 5.4% 8.3%
Common dividend
payout 72.8% 66.4% 337.8% 50.0% 58.9%
Proportionate Net Debt, Preferreds and EBITDA
BCE Corporate and Bell Canada Net debt and preferreds
At December 31, 2005
($ millions, Bell Bell Inter-
except where Canada Canada company Total BCE Inc.
otherwise (excl. Statu- elimi- Bell Corpo-
indicated) Aliant) Aliant tory nations Canada rate
-------------------------------------------------------------- ---------
Cash and cash
equivalents (38) (195) (233) (233) 3
Long-term debt 9,279 898 10,177 (339) 9,838 1,700
Debt due within
one year 818 18 836 (96) 740 300
Long-term note
receivable from BCH (498) - (498) 498 - -
PPA fair value
increment(7) 99 -
-------------------------------------------------------------- ---------
Net debt 9,561 721 10,282 63 10,444 2,003
Preferred shares
- Bell Canada(8) 1,100 1,100 1,100 -
Preferred shares
- Aliant(8) 172 172 172 -
Perpetual Preferred
shares - BCE - - - - 1,670
Nortel common
shares at market - - - - (52)
-------------------------------------------------------------- ---------
Net debt and
preferreds 10,661 893 11,554 63 11,716 3,621
-------------------------------------------------------------- ---------
-------------------------------------------------------------- ---------
Proportionate net debt and preferreds, Trailing EBITDA
For the quarter ended December 31, 2005
Propor-
($ millions, tionate Total EBITDA
except where net debt
otherwise % and
indicated) owned pre- Trai-
by BCE ferreds Q4 05 Q3 05 Q2 05 Q1 05 ling
-------------------------------------------------------------------------
Bell Canada
(excluding
Aliant) 100% 10,823(x) 1,504 1,578 1,618 1,605 6,305
Aliant 53.2% 475 225 226 221 210 882
-------------------------------------------------------------------------
Total Bell Canada
Consolidated 11,298 1,729 1,804 1,839 1,815 7,187
Other BCE
Bell Globemedia 68.5% 260 120 46 114 83 363
Telesat 100% 276 65 70 71 63 269
Corporate and other 100% 3,613 (36) (36) (39) (37) (148)
-------------------------------------------------------------------------
Total Other BCE 4,149 149 80 146 109 484
Inter-segment
eliminations (20) (20) (13) (21) (74)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total 15,447 1,858 1,864 1,972 1,903 7,597
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Propor-
($ millions, tionate Proportionate EBITDA
except where net debt
otherwise % and
indicated) owned pre- Trai-
by BCE ferreds Q4 05 Q3 05 Q2 05 Q1 05 ling
-------------------------------------------------------------------------
Bell Canada
(excluding
Aliant) 100% 10,823(x) 1,504 1,578 1,618 1,605 6,305
Aliant 53.2% 475 120 120 117 112 469
-------------------------------------------------------------------------
Total Bell Canada
Consolidated 11,298 1,624 1,698 1,735 1,717 6,774
Other BCE
Bell Globemedia 68.5% 260 73 23 68 49 213
Telesat 100% 276 65 70 71 63 269
Corporate and other 100% 3,613 (36) (36) (39) (37) (148)
-------------------------------------------------------------------------
Total Other BCE 102 57 100 75 334
Inter-segment
eliminations (20) (20) (13) (21) (74)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total 15,447 1,706 1,735 1,822 1,771 7,034
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(x) Bell Canada (excl. Aliant) net debt and preferreds of $10,661 million
plus $63 million of inter-company eliminations plus $99 million upon
consolidation (PPA fair value increment).
Bell Canada Consolidated (1)
Operational Data
($ millions, Q4 Q4 Total Total
except where
otherwise $ % $ %
indicated) 2005 2004 change change 2005 2004 change change
-------------------------------------------------------------------------
Revenues
Local and
access 1,343 1,397 (54) (3.9%) 5,446 5,572 (126) (2.3%)
Long
distance 478 560 (82) (14.6%) 2,044 2,327 (283) (12.2%)
Wireless 812 742 70 9.5% 3,097 2,818 279 9.9%
Data 1,097 963 134 13.9% 4,015 3,640 375 10.3%
Video 268 219 49 22.4% 976 850 126 14.8%
Terminal
sales and
other 459 422 37 8.8% 1,672 1,580 92 5.8%
-------------------------------------------------------------------------
Total
operating
revenues 4,457 4,303 154 3.6% 17,250 16,787 463 2.8%
Operating
expenses (2,728) (2,624) (104) (4.0%)(10,063) (9,676) (387) (4.0%)
-------------------------------------------------------------------------
EBITDA(2) 1,729 1,679 50 3.0% 7,187 7,111 76 1.1%
EBITDA
margin
(%) (3) 38.8% 39.0% (0.2)pts 41.7% 42.4% (0.7)pts
Amortization
expense (755) (763) 8 1.0% (2,989) (2,962) (27) (0.9%)
Net benefit
plans cost (66) (62) (4) (6.5%) (389) (235) (154) (65.5%)
Restructuring
and other
items (24) (123) 99 80.5% (54) (1,219) 1,165 95.6%
-------------------------------------------------------------------------
Operating
income 884 731 153 20.9% 3,755 2,695 1,060 39.3%
Other income - 20 (20)(100.0%) 39 183 (144) (78.7%)
Interest
expense (208) (212) 4 1.9% (827) (863) 36 4.2%
-------------------------------------------------------------------------
Pre-tax
earnings 676 539 137 25.4% 2,967 2,015 952 47.2%
Income taxes (138) (140) 2 1.4% (743) (506) (237) (46.8%)
Non-controlling
interest (22) 8 (30) n.m. (71) 9 (80) n.m.
-------------------------------------------------------------------------
Net earnings
before
extraordinary
gain 516 407 109 26.8% 2,153 1,518 635 41.8%
Extraordinary
gain - 69 (69)(100.0%) - 69 (69)(100.0%)
-------------------------------------------------------------------------
Net earnings 516 476 40 8.4% 2,153 1,587 566 35.7%
Dividends on
preferred
shares (14) (11) (3) (27.3%) (55) (60) 5 8.3%
-------------------------------------------------------------------------
Net earnings
applicable
to common
shares 502 465 37 8.0% 2,098 1,527 571 37.4%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other information
Cash flow information
Free Cash Flow (FCF)(2)
Cash from
operating
activi-
ties 1,630 1,293 337 26.1% 5,508 5,333 175 3.3%
Capital
expendi-
tures (736) (985) 249 25.3% (3,122) (3,026) (96) (3.2%)
Dividends
and
distribu-
tions (404) (351) (53) (15.1%) (1,747) (1,736) (11) (0.6%)
Other
investing
items 1 (8) 9 n.m. 5 (15) 20 n.m.
-------------------------------------------------------------------------
Total 491 (51) 542 n.m. 644 556 88 15.8%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Capital
expenditures
as a
percentage
of
revenues
(%) 16.5% 22.9% 6.4 pts 18.1% 18.0% (0.1)pts
Balance Sheet Information Dec. 31 Dec. 31
2005 2004
-------------------------------------------------------------------------
Net Debt
Long-term debt 10,177 9,166
Debt due within one year 836 1,352
Less: Cash and cash equivalents (233) (32)
-------------------------------------------------------------------------
Total Net Debt 10,780 10,486
Non-controlling interest 1,212 1,229
Total shareholders' equity 10,135 9,670
-------------------------------------------------------------------------
Total Capitalization 22,127 21,385
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net Debt: Total Capitalization 48.7% 49.0%
Net Debt: Trailing 12 month EBITDA 1.50 1.47
EBITDA : Interest (trailing 12 month) 8.69 8.24
n.m.: not meaningful
Bell Canada Consolidated (1)
Operational Data - Historical Trend
Total
($ millions,
except where
otherwise
indicated) 2005 Q4 05 Q3 05 Q2 05 Q1 05
-------------------------------------------------------------------------
Revenues
Local and access 5,446 1,343 1,367 1,368 1,368
Long distance 2,044 478 510 518 538
Wireless 3,097 812 801 771 713
Data 4,015 1,097 1,001 966 951
Video 976 268 251 236 221
Terminal sales
and other 1,672 459 396 399 418
-------------------------------------------------------------------------
Total operating
revenues 17,250 4,457 4,326 4,258 4,209
Operating expenses (10,063) (2,728) (2,522) (2,419) (2,394)
-------------------------------------------------------------------------
EBITDA(2) 7,187 1,729 1,804 1,839 1,815
EBITDA margin (%)(3) 41.7% 38.8% 41.7% 43.2% 43.1%
Amortization expense (2,989) (755) (756) (746) (732)
Net benefit plans cost (389) (66) (110) (107) (106)
Restructuring and
other items (54) (24) (30) (5) 5
-------------------------------------------------------------------------
Operating income
(loss) 3,755 884 908 981 982
Other income 39 - 15 13 11
Interest expense (827) (208) (207) (206) (206)
-------------------------------------------------------------------------
Pre-tax earnings
(loss) 2,967 676 716 788 787
Income taxes (743) (138) (198) (178) (229)
Non-controlling
interest (71) (22) (16) (17) (16)
-------------------------------------------------------------------------
Net earnings (loss)
before extraordinary
gain 2,153 516 502 593 542
Extraordinary gain - - - - -
-------------------------------------------------------------------------
Net earnings 2,153 516 502 593 542
Dividends on
preferred shares (55) (14) (14) (13) (14)
-------------------------------------------------------------------------
Net earnings
applicable to
common shares 2,098 502 488 580 528
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other information
-------------------------------------------------------------------------
Cash flow information
Free Cash Flow (FCF)(2)
Cash from
operating
activities 5,508 1,630 1,551 1,467 860
Capital
expenditures (3,122) (736) (873) (847) (666)
Dividends and
distributions (1,747) (404) (468) (453) (422)
Other investing
items 5 1 4 4 (4)
-------------------------------------------------------------------------
Total 644 491 214 171 (232)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Capital expenditures
as a percentage
of revenues (%) 18.1% 16.5% 20.2% 19.9% 15.8%
Total
($ millions,
except where
otherwise
indicated) 2004 Q4 04 Q3 04 Q2 04 Q1 04
-------------------------------------------------------------------------
Revenues
Local and access 5,572 1,397 1,395 1,401 1,379
Long distance 2,327 560 589 572 606
Wireless 2,818 742 727 698 651
Data 3,640 963 915 870 892
Video 850 219 213 211 207
Terminal sales
and other 1,580 422 367 420 371
-------------------------------------------------------------------------
Total operating
revenues 16,787 4,303 4,206 4,172 4,106
Operating expenses (9,676) (2,624) (2,350) (2,351) (2,351)
-------------------------------------------------------------------------
EBITDA(2) 7,111 1,679 1,856 1,821 1,755
EBITDA margin (%)(3) 42.4% 39.0% 44.1% 43.6% 42.7%
Amortization expense (2,962) (763) (734) (733) (732)
Net benefit plans cost (235) (62) (55) (58) (60)
Restructuring and
other items (1,219) (123) (1,080) (13) (3)
-------------------------------------------------------------------------
Operating income
(loss) 2,695 731 (13) 1,017 960
Other income 183 20 114 19 30
Interest expense (863) (212) (215) (216) (220)
-------------------------------------------------------------------------
Pre-tax earnings
(loss) 2,015 539 (114) 820 770
Income taxes (506) (140) 75 (245) (196)
Non-controlling
interest 9 8 2 9 (10)
-------------------------------------------------------------------------
Net earnings (loss)
before extraordinary
gain 1,518 407 (37) 584 564
Extraordinary gain 69 69 - - -
-------------------------------------------------------------------------
Net earnings 1,587 476 (37) 584 564
Dividends on
preferred shares (60) (11) (16) (17) (16)
-------------------------------------------------------------------------
Net earnings
applicable to
common shares 1,527 465 (53) 567 548
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Other information
-------------------------------------------------------------------------
Cash flow information
Free Cash Flow (FCF)(2)
Cash from
operating
activities 5,333 1,293 1,756 1,089 1,195
Capital
expenditures (3,026) (985) (736) (715) (590)
Dividends and
distributions (1,736) (351) (445) (437) (503)
Other investing
items (15) (8) 1 (1) (7)
-------------------------------------------------------------------------
Total 556 (51) 576 (64) 95
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Capital expenditures
as a percentage
of revenues (%) 18.0% 22.9% 17.5% 17.1% 14.4%
Balance Sheet
Information Dec. 31 Sept. 30 June 30 March 31 Dec. 31
2005 2005 2005 2005 2004
-------------------------------------------------------------------------
Net Debt
Long-term debt 10,177 10,171 10,023 9,657 9,166
Debt due within
one year 836 1,365 1,500 1,634 1,352
Less: Cash and cash
equivalents (233) (298) (169) (308) (32)
-------------------------------------------------------------------------
Total Net Debt 10,780 11,238 11,354 10,983 10,486
Non-controlling
interest 1,212 1,125 1,162 1,202 1,229
Total shareholders'
equity 10,135 10,067 9,957 9,796 9,670
-------------------------------------------------------------------------
Total
Capitalization 22,127 22,430 22,473 21,981 21,385
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net Debt: Total
Capitalization 48.7% 50.1% 50.5% 50.0% 49.0%
Net Debt : Trailing
12 month EBITDA 1.50 1.57 1.58 1.53 1.47
EBITDA : Interest
(trailing 12 month) 8.69 8.59 8.57 8.45 8.24
Bell Canada Consolidated(1)
Statistical Data
Q4 Q4 % Total Total %
2005 2004 change 2005 2004 change
-------------------------------------------------------------------------
Wireline
Local
Network access
services (k)
Residential 7,985 8,392 (4.8%) 7,985 8,392 (4.8%)
Business 4,596 4,513 1.8% 4,596 4,513 1.8%
-------------------------------------------------------------------------
Total 12,581 12,905 (2.5%) 12,581 12,905 (2.5%)
SmartTouch feature
revenues ($M) 217 233 (6.9%) 890 939 (5.2%)
Long Distance (LD)
Conversation
minutes (M) 4,567 4,559 0.2% 18,306 18,070 1.3%
Average revenue
per minute ($) 0.096 0.109 (11.9%) 0.102 0.117 (12.8%)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Data
Equivalent access
lines(9) (k) -
Ontario and Quebec
Digital equivalent
access lines (k) 5,034 4,335 16.1% 5,034 4,335 16.1%
Internet
subscribers(10) (k)
High Speed
Internet net
activations (k) 61 91 (33.0%) 387 350 10.6%
High Speed
Internet
subscribers (k) 2,195 1,808 21.4% 2,195 1,808 21.4%
Dial-up Internet
subscribers (k) 586 743 (21.1%) 586 743 (21.1%)
-------------------------------------------------------------------------
2,781 2,551 9.0% 2,781 2,551 9.0%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Wireless
Cellular & PCS net
activations (k)
Pre-paid 83 88 (5.7%) 227 142 59.9%
Post-paid 127 129 (1.6%) 289 371 (22.1%)
-------------------------------------------------------------------------
210 217 (3.2%) 516 513 0.6%
Cellular & PCS
subscribers (k)
Pre-paid 1,428 1,201 18.9% 1,428 1,201 18.9%
Post-paid 4,013 3,724 7.8% 4,013 3,724 7.8%
-------------------------------------------------------------------------
5,441 4,925 10.5% 5,441 4,925 10.5%
Average revenue
per unit (ARPU)
($/month) 51 50 2.0% 49 49 0.0%
Pre-paid 14 13 7.7% 14 12 16.7%
Post-paid 64 61 4.9% 61 61 0.0%
Churn (%) (average
per month) 1.5% 1.4% (0.1)pts 1.6% 1.3% (0.3)pts
Pre-paid 2.2% 1.9% (0.3)pts 1.9% 1.9% 0.0 pts
Post-paid 1.3% 1.2% (0.1)pts 1.4% 1.1% (0.3)pts
Usage per subscriber
(min/month) 261 252 3.6% 255 248 2.8%
Cost of acquisition
(COA)(11) ($/sub) 409 402 (1.7%) 406 411 1.2%
Wireless EBITDA
($ millions) 311 274 13.5% 1,307 1,187 10.1%
Wireless EBITDA
margin(12) 37.1% 36.2% 0.9 pts 41.2% 41.5% (0.3)pts
Wireless capital
expenditures
($ millions) 58 125 53.6% 343 362 5.2%
Wireless capital
expenditures as a
percentage
of revenue 7.1% 16.8% 9.7 pts 11.1% 12.8% 1.7 pts
Paging
subscribers (k) 347 427 (18.7%) 347 427 (18.7%)
Paging average
revenue per unit
($/month) 10 9 11.1% 11 10 10.0%
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Video (DTH and VDSL)
Total
subscribers (k) 1,727 1,503 14.9% 1,727 1,503 14.9%
Net subscriber
activations (k) 50 43 16.3% 224 116 93.1%
ARPU ($/month) 52 49 6.1% 50 49 2.0%
COA ($/sub) 258 537 52.0% 375 571 34.3%
Video EBITDA
($ millions) 23 (4) n.m. 45 (19) n.m.
Churn (%) (average
per month) 1.0% 0.8% (0.2)pts 0.9% 1.0% 0.1 pts
n.m.: not meaningful
Bell Canada Consolidated(1)
Statistical Data - Historical Trend
Total
2005 Q4 05 Q3 05 Q2 05 Q1 05
-------------------------------------------------------------------------
Wireline
Local
Network access
services (k)
Residential 7,985 8,133 8,189 8,332
Business 4,596 4,570 4,538 4,518
-------------------------------------------------------------------------
Total 12,581 12,703 12,727 12,850
SmartTouch feature
revenues ($M) 890 217 221 225 227
Long Distance (LD)
Conversation
minutes (M) 18,306 4,567 4,484 4,667 4,588
Average revenue
per minute ($) 0.102 0.096 0.105 0.101 0.107
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Data
Equivalent access
lines(9) (k) -
Ontario and Quebec
Digital equivalent
access lines (k) 5,034 4,847 4,634 4,469
Internet
subscribers(10) (k)
High Speed Internet
net activations (k) 387 61 106 92 128
High Speed Internet
subscribers (k) 2,195 2,134 2,028 1,936
Dial-up Internet
subscribers (k) 586 621 666 696
-------------------------------------------------------------------------
2,781 2,755 2,694 2,632
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Wireless
Cellular & PCS net
activations (k)
Pre-paid 227 83 73 29 42
Post-paid 289 127 50 117 (5)
-------------------------------------------------------------------------
516 210 123 146 37
Cellular & PCS
subscribers (k)
Pre-paid 1,428 1,345 1,272 1,243
Post-paid 4,013 3,886 3,836 3,719
-------------------------------------------------------------------------
5,441 5,231 5,108 4,962
Average revenue
per unit (ARPU)
($/month) 49 51 51 50 46
Pre-paid 14 14 14 16 11
Post-paid 61 64 63 61 57
Churn (%) (average
per month) 1.6% 1.5% 1.5% 1.6% 1.6%
Pre-paid 1.9% 2.2% 1.6% 2.1% 1.8%
Post-paid 1.4% 1.3% 1.5% 1.4% 1.6%
Usage per subscriber
(min/month) 255 261 265 262 232
Cost of acquisition
(COA)(11) ($/sub) 406 409 432 401 373
Wireless EBITDA
($ millions) 1,307 311 363 333 300
Wireless EBITDA
margin(12) 41.2% 37.1% 44.0% 42.4% 41.4%
Wireless capital
expenditures
($ millions) 343 58 103 118 64
Wireless capital
expenditures as a
percentage
of revenue 11.1% 7.1% 12.9% 15.3% 9.0%
Paging subscribers (k) 347 364 385 404
Paging average
revenue per unit
($/month) 11 10 10 10 15
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Video (DTH and VDSL)
Total subscribers (k) 1,727 1,677 1,595 1,532
Net subscriber
activations (k) 224 50 82 63 29
ARPU ($/month) 50 52 51 50 48
COA ($/sub) 375 258 360 462 473
Video EBITDA
($ millions) 45 23 12 6 4
Churn (%) (average
per month) 0.9% 1.0% 1.0% 0.9% 0.8%
-------------------------------------------------------------------------
Total
2004 Q4 04 Q3 04 Q2 04 Q1 04
-------------------------------------------------------------------------
Wireline
Local
Network access
services (k)
Residential 8,392 8,427 8,390 8,476
Business 4,513 4,535 4,548 4,541
-------------------------------------------------------------------------
Total 12,905 12,962 12,938 13,017
SmartTouch feature
revenues ($M) 939 233 234 235 237
Long Distance (LD)
Conversation
minutes (M) 18,070 4,559 4,435 4,498 4,578
Average revenue
per minute ($) 0.117 0.109 0.120 0.118 0.120
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Data
Equivalent access
lines(9) (k) -
Ontario and Quebec
Digital equivalent
access lines (k) 4,335 4,197 4,083 3,983
Internet
subscribers(10) (k)
High Speed Internet
net activations (k) 350 91 84 65 110
High Speed Internet
subscribers (k) 1,808 1,717 1,633 1,568
Dial-up Internet
subscribers (k) 743 775 807 836
-------------------------------------------------------------------------
2,551 2,492 2,440 2,404
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Wireless
Cellular & PCS net
activations (k)
Pre-paid 142 88 14 17 23
Post-paid 371 129 95 78 69
-------------------------------------------------------------------------
513 217 109 95 92
Cellular & PCS
subscribers (k)
Pre-paid 1,201 1,113 1,099 1,082
Post-paid 3,724 3,595 3,500 3,422
-------------------------------------------------------------------------
4,925 4,708 4,599 4,504
Average revenue
per unit (ARPU)
($/month) 49 50 50 50 47
Pre-paid 12 13 12 11 11
Post-paid 61 61 63 62 59
Churn (%) (average
per month) 1.3% 1.4% 1.2% 1.3% 1.3%
Pre-paid 1.9% 1.9% 1.9% 1.9% 1.7%
Post-paid 1.1% 1.2% 1.0% 1.1% 1.1%
Usage per subscriber
(min/month) 248 252 258 257 224
Cost of acquisition
(COA)(11) ($/sub) 411 402 381 413 455
Wireless EBITDA
($ millions) 1,187 274 334 317 262
Wireless EBITDA
margin(12) 41.5% 36.2% 45.4% 44.9% 39.6%
Wireless capital
expenditures
($ millions) 362 125 95 77 65
Wireless capital
expenditures as a
percentage
of revenue 12.8% 16.8% 13.1% 11.0% 10.0%
Paging subscribers (k) 427 449 469 493
Paging average
revenue per unit
($/month) 10 9 10 10 10
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Video (DTH and VDSL)
Total subscribers (k) 1,503 1,460 1,427 1,403
Net subscriber
activations (k) 116 43 33 24 16
ARPU ($/month) 49 49 48 49 48
COA ($/sub) 571 537 548 570 661
Video EBITDA
($ millions) (19) (4) (16) - 1
Churn (%) (average
per month) 1.0% 0.8% 1.1% 1.0% 0.9%
-------------------------------------------------------------------------
Accompanying Notes
(1) We have reclassified some of the figures for the comparative period
to make them consistent with the current period's presentation. On
December 16, 2005, BCE announced its decision to sell its stake in
CGI and that CGI would purchase 100 million of the class A shares
held by BCE. As at December 31, 2005 BCE has accounted for CGI as a
discontinued operation and no longer proportionally consolidates its
financial results.
(2) Non-GAAP Financial Measures
EBITDA
The term, EBITDA (earnings before interest, taxes, depreciation and
amortization), does not have any standardized meaning prescribed by
Canadian generally accepted accounting principles (GAAP). It is
therefore unlikely to be comparable to similar measures presented by
other companies. EBITDA is presented on a consistent basis from
period to period.
We define EBITDA as operating revenues less operating expenses,
which means it represents operating income before amortization
expense, net benefit plans cost, and restructuring and other items.
We use EBITDA, among other measures, to assess the operating
performance of our ongoing businesses without the effects of
amortization expense, net benefit plans cost, and restructuring and
other items. We exclude amortization expense and net benefit plans
cost because they largely depend on the accounting methods and
assumptions a company uses, as well as non-operating factors, such
as the historical cost of capital assets and the fund performance of
a company's pension plans. We exclude restructuring and other items
because they are transitional in nature.
EBITDA allows us to compare our operating performance on a
consistent basis. 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 valuation measurement in
the telecommunications industry.
EBITDA should not be confused with net cash flows from operating
activities. The most comparable Canadian GAAP financial measure is
operating income.
EPS before net gains (losses) on investments and restructuring and
other items
The term, EPS (earnings per share) before net gains (losses) on
investments and restructuring and other items, does not have any
standardized meaning prescribed by GAAP. It is therefore unlikely to
be comparable to similar measures presented by other companies.
We use EPS before net gains (losses) on investments and
restructuring and other items, among other measures, to assess the
operating performance of our ongoing businesses without the effects
of after-tax restructuring and other items and net gains on
investments. We exclude these items because they affect the
comparability of our financial results and could potentially distort
the analysis of trends in business performance. The exclusion of
these items does not imply they are necessarily non-recurring.
The most comparable Canadian GAAP financial measure is EPS.
FREE CASH FLOW
The term, free cash flow, does not have any standardized meaning
prescribed by Canadian GAAP. It is therefore unlikely to be
comparable to similar measures presented by other companies. Free
cash flow is presented on a consistent basis from period to period.
We define free cash flow as cash from operating activities after
capital expenditures, total dividends and other investing
activities.
We consider free cash flow to be an important indicator of the
financial strength and performance of our business because it shows
how much cash is available to repay debt and to reinvest in our
company. We believe that certain investors and analysts use free
cash flow when valuing a business and its underlying assets.
The most comparable Canadian GAAP financial measure is cash from
operating activities.
(3) EBITDA margin is calculated as follows:
EBITDA
------------------
Operating revenues
(4) Effective Q2 2005 the total Wireless capital expenditures are
segregated between the Residential and Business segments. Prior
quarters have been restated accordingly.
(5) Cash flow per share is calculated as follows:
Cash flow from operations less capital expenditures
------------------------------------------------------------
Average number of common shares outstanding during the period
(6) Annualized cash flow yield is calculated as follows:
Free cash flow from operations before common dividends
------------------------------------------------------
Number of common shares outstanding at end of period
multiplied by share price at end of period
Note: to annualize, multiply the most recent quarter's resultant
by 4.
(7) Reflects an increase in the total Bell Canada debt as a result of
the completion of the purchase price allocation (PPA) relating to
the repurchase of SBC's 20% interest in Bell Canada, which resulted
in an increase in long-term debt of $165 million. This increase in
long-term debt will be applied against interest expense ($4 million
in Q4 2005) over the remaining terms of the related long-term debt.
(8) At the BCE Consolidated level, Third Party Preferred Shares
reflected in the financial statements of subsidiaries are included
in non-controlling interest on the balance sheet.
(9) Digital equivalent access lines are derived by converting low
capacity data lines (DS-3 and lower) to the equivalent number of
voice grade access lines. Broadband equivalent access lines are
derived by converting high capacity data lines (higher than DS-3) to
the equivalent number of voice grade access lines.
Conversion factors
DS-0 1
Basic ISDN 2
Primary ISDN 23
DS-1, DEA 24
DS-3 672
OC-3 2,016
OC-12 8,064
OC-48 32,256
OC-192 129,024
10 Base T 155
100 Base T 1,554
Gigabit E 15,554
(10) High Speed Internet subscribers include Residential, Business and
Wholesale. Dial-up Internet subscribers include Residential and
Business.
(11) Includes allocation of selling costs from Bell Canada and excludes
costs of migrating from analog to digital. Cost of Acquisition (COA)
per subscriber is reflected on a consolidated basis.
(12) Wireless EBITDA margins are calculated based on total Wireless
operating revenues (i.e. external revenues as shown on pages 10 and
11 plus inter-company revenues).
SOURCE BCE INC.
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