SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 under
the Securities Exchange Act of 1934
For the month of October 2002 Commission File Number 1-8481
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BCE Inc.
(Translation of Registrant's name into English)
1000, rue de La Gauchetiere Ouest, Bureau 3700, Montreal, Quebec H3B 4Y7,
(514) 397-7000
(Address of principal executive offices)
Indicate by check mark whether the Registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F Form 40-F X
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Indicate by check mark whether the Registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate below the file number assigned to the
Registrant in connection with Rule 12g3-2(b): 82- .
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This Form 6-K is not incorporated by reference in the registration statement
filed by BCE Inc. with the Securities and Exchange Commission under Form F-3
on June 15, 2000 (Registration No. 333-12130), under Form S-8 on October 16,
2000 (Registration No. 333-12780), under Form S-8 on November 1, 2000
(Registration No. 333-12802) and under Form S-8 on November 1, 2000
(Registration No. 333-12804). Notwithstanding any reference to BCE Inc.'s
Web site on the World Wide Web in the documents attached hereto, the
information contained in BCE Inc.'s Web site or any other site on the World
Wide Web referred to in BCE Inc.'s site is not a part of this Form 6-K and,
therefore, is not filed with the Securities and Exchange Commission.
1
For immediate release
(All figures are in Cdn$, unless otherwise indicated)
BCE REPORTS THIRD QUARTER RESULTS
o Revenues of $4.8 billion; EBITDA up 4%
o High-speed Internet (DSL) subscribers surpass 1 million
Montreal (Quebec), October 23, 2002 -- For the third quarter of 2002, BCE Inc.
(TSX, NYSE: BCE) reported total revenue of $4.8 billion, EBITDA(1) of $2.0
billion, and net earnings applicable to common shares of $368 million ($0.43
per common share). Net earnings before non-recurring items (1) were $393
million ($0.45 per common share).
"The communications industry continues to face many challenges, and in this
environment the prudent management of costs and the implementation of
productivity initiatives is essential," said Michael Sabia, President and
Chief Executive Officer of BCE Inc. "Although, we have experienced weakness in
the business wholesale and enterprise retail data markets, our efforts in cost
management have resulted in EBITDA growth of 4% compared to the third quarter
of 2001."
Operational Highlights (Q3 2002 vs. Q3 2001 unless otherwise indicated)
Quarter Subscriber Total
/Revenue Growth
High-speed Internet (DSL) 93,000 net additions 60% 1,002,000 subscribers
Cellular and PCS 62,000 net additions 16% 3,707,000 subscribers
Bell ExpressVu 45,000 net additions 31% 1,221,000 subscribers
Data revenue $926 m 5% n.a.
Bell Globemedia revenue $273 million 11% n.a.
Productivity initiatives $150 million n.a. Year to date: $515 million
"During the third quarter, we reached a significant milestone at Bell Canada
when we signed up our one millionth High-speed Internet subscriber," Mr. Sabia
said. "Our wireless and Direct-to-Home (DTH) satellite operations also
experienced sustained growth."
"Bell Globemedia had a strong third quarter with increased revenues primarily
from higher demand for advertising as well as improved EBITDA," Mr. Sabia added.
"We believe BCE Emergis is making progress in achieving disciplined
profitability."
Overview
Total revenue at BCE was $4.8 billion, essentially flat when compared to the
same period last year. Excluding the impact of regulatory changes, revenue
growth at BCE was at 2%. Local and access service revenues decreased as a
result of the impact of regulatory decisions while data revenue growth weakened
due to lower business wholesale and enterprise demand. Additionally, BCE
Emergis reported lower revenues due to a decline in non-recurring and recurring
revenues. These decreases were offset by the underlying growth in key areas:
a 14.5% increase in wireless revenues, increased DTH (Direct-to-Home) satellite
entertainment services revenues of 33% and an 11% increase in revenues at Bell
Globemedia. EBITDA increased by $75 million or 4% compared to the same period
last year, mainly due to careful cost management across all areas.
Consolidated net earnings applicable to common shares were $368 million, a
significant improvement from the loss of $144 million reported last year.
During the third quarter, BCE recorded an after-tax charge of $37 million
relating to the pay equity settlement at Bell Canada as well as a $12 million
dilution gain from the issuance of common shares by BCE Emergis to third
parties. Excluding these items, net earnings applicable to common shares were
$0.45 for the quarter.
Outlook
On October 7, 2002, the Company confirmed the lower end of its financial
guidance for the full year 2002, excluding discontinued operations (Teleglobe
and BCI), at approximately $19.5 billion in revenue, $7.5 billion in EBITDA and
net earnings per share (before non-recurring items) of $1.80.
2
RESULTS BY BUSINESS GROUP (unaudited)
BCE's core operations as at September 30, 2002, included the Bell Canada
segment, Bell Globemedia, and BCE Emergis. BCE Ventures consists of BCE's
other investments.
(Cdn$ millions, except per share amounts)
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Third quarter Nine months
For the period ended September 30 2002 2001 2002 2001
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Revenue
Bell Canada 4,314 4,326 12,957 12,666
Bell Globemedia 273 246 911 849
BCE Emergis 135 173 409 475
BCE Ventures 258 262 782 757
Corporate and Other, including Inter-segment
eliminations (158) (189) (463) (520)
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Total revenue 4,822 4,818 14,596 14,227
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EBITDA
Bell Canada 1,891 1,818 5,501 5,172
Bell Globemedia 17 (6) 108 65
BCE Emergis 19 35 10 92
BCE Ventures 67 73 217 202
Corporate and Other, including Inter-segment
eliminations (42) (43) (127) (116)
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Total EBITDA 1,952 1,877 5,709 5,415
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Net earnings (loss)
Bell Canada 336 272 1,016 764
Bell Globemedia (11) (52) 1 (125)
BCE Emergis 19 (70) (58) (236)
BCE Ventures 16 137 99 229
Corporate and Other, including Inter-segment
eliminations 24 50 5 3,029
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Earnings from continuing operations 384 337 1,063 3,661
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Discontinued operations - (465) (340) (2,862)
Dividends on preferred shares (16) (16) (43) (50)
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Net earnings (loss) applicable to common 368 (144) 680 749
shares
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Net earnings (loss) per common share 0.43 (0.18) 0.82 0.93
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Non-recurring items included in net
earnings (loss) per common share
Amortization of goodwill - (0.29) - (0.91)
Other items (2) (0.03) (0.33) (0.55) 0.52
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THIRD QUARTER REVIEW (Q3 2002 vs. Q3 2001, unless otherwise indicated)
BELL CANADA
The Bell Canada segment includes Bell Canada, Aliant, Bell ExpressVu and Bell
Canada's interests in other Canadian telcos.
o Total revenue in the third quarter decreased slightly over last year mainly
as a result of the effects of recent CRTC decisions and slower data revenue
growth.
o Excluding the impact of the regulatory changes (see below), revenues for the
quarter increased by 2%.
o Reported local and access revenues decreased by 7% to $1.5 billion.
Excluding the effects of the 2001 CRTC local
contribution and May 30, 2002 CRTC Price Caps decisions, local and access
revenues decreased by 1%.
o Although long distance market share is stable, revenue decreased by $12
million. Competitive pressures more than offset the effects of a 6% increase
in conversation minutes.
o Wireless revenue was up 14.5% to $561 million due to continued growth in
cellular and PCS subscribers.
o Data revenue increased 5% to $926 million, due to higher IP/Broadband and
Sympatico ISP revenues. Data revenue growth has slowed when compared to the
growth of 14% in the first quarter and 8% in the second quarter as a result
of lower demand from business wholesale and enterprise retail data customers.
o Total Internet(High-speed and dial-up) subscribers reached 1,987,000 as at
September 30.
o Bell ExpressVu revenue increased by 33% as a result of the increase in the
subscriber base.
o Bell Canada's EBITDA grew by $73 million or 4% in the third quarter to reach
$1.9 billion due to continued cost management.
o Productivity gains at Bell Canada were $145 million for the quarter.
o Year-to-date capex intensity (capital expenditures to revenue) improved from
28% as of September 30, 2001 to 19% as of September 30, 2002.
BELL GLOBEMEDIA
Bell Globemedia includes CTV, The Globe and Mail and Bell Globemedia
Interactive.
o Total revenue was $273 million in the quarter compared with revenue of $246
million for the same period last year. This increase includes organic
growth of 7% as well as the impact of the acquisitions of CFCF-TV, CKY-TV
and ROB TV, which were purchased in the latter part of 2001.
o Advertising revenue was $180 million in the quarter, an increase of 10%
compared to the third quarter of 2001. A stronger economic climate in the
advertising sector as well as higher interactive revenues contributed to the
increase.
o Subscriber revenues increased by 13% to reach $72 million due to higher
subscription to the new digital specialty channels and an increase in print
circulation revenues.
o EBITDA was $17 million in the third quarter compared with a shortfall of $6
million for the same period last year, reflecting the increase in revenues
and management's cost control efforts.
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BCE EMERGIS
o BCE Emergis' sequential quarter over quarter revenues decreased by $7 million
mainly due to lower recurring revenues. Revenue was $135 million in the
quarter, compared with $173 million for the same period in 2001.
o Third quarter EBITDA of $19 million compared favorably to the second quarter
EBITDA of $11 million. The improvement in sequential quarter over quarter
EBITDA was mainly related to cost savings resulting from the restructuring
plan BCE Emergis implemented in the second quarter. Year-over-year quarterly
EBITDA decreased by 46% to $19 million, reflecting the shortfall in revenues.
o In the quarter, 43% of BCE Emergis' total revenue was from its U.S.
operations.
BCE VENTURES
BCE Ventures includes the activities of CGI, Telesat and other investments.
o BCE Ventures' revenue was $258 million in the quarter, a decrease of 2% when
compared with the same period of 2001. Revenues at CGI were higher, offset
by lower revenues at the other Ventures' businesses.
o EBITDA was $67 million in the quarter compared with $73 million in the third
quarter of 2001.
BELL CANADA STATUTORY RESULTS
Bell Canada "statutory" includes Bell Canada, Bell Canada's interests in other
Canadian telcos, and Bell Canada's 39% interest in Aliant (equity-accounted).
Bell Canada's reported revenue was $3.6 billion in the third quarter, 2% lower
when compared to the same quarter of 2001. The net earnings applicable to
common shares were $478 million in the quarter, compared to $410 million for
the same period last year.
ABOUT BCE
BCE is Canada's largest communications company. It has 24 million customer
connections through the wireline, wireless, data/Internet and satellite
services it provides, largely under the Bell brand. BCE leverages those
connections with extensive content creation capabilities through Bell
Globemedia which features some of the strongest brands in the industry -- CTV,
Canada's leading private broadcaster, The Globe and Mail, the leading Canadian
daily national newspaper and Sympatico.ca, a leading Canadian Internet portal.
As well, BCE has extensive e-commerce capabilities provided under the BCE
Emergis brand. BCE shares are listed in Canada, the United States and Europe.
-- 30 --
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Supplementary BCE Financial Information:
BCE's Third Quarter, 2002 Investor Briefing and other relevant financial
materials are available in the "Investor Relations" section of BCE's Web site
at www.bce.ca.
Call with Financial Analysts:
BCE Inc. (TSX:BCE, NYSE:BCE) will hold a teleconference / Webcast (audio only)
for financial analysts to discuss its third quarter results on Wednesday,
October 23, 2002 at 8:30 AM (Eastern). The media is welcome to participate on
a listen only basis. Michael Sabia, President and Chief Executive Officer,
and Siim Vanaselja, Chief Financial Officer, will be present for the
teleconference / Webcast. Interested participants are asked to dial
(416) 695-5806 between 8:20 AM and 8:28 AM. If you are disconnected from the
call, simply redial the number. If you need assistance during the
teleconference, you can reach the operator by pressing "0". This
teleconference will also be Webcast live (audio only) on our Web site at
www.bce.ca. A replay facility will be available between 12:00 PM on Wednesday,
October 23, 2002 and 12:00 PM on Wednesday, October 30, 2002. To access the
replay facility, please dial (416) 695-5800 and enter access code 1253888.
The Webcast will also be archived on our Web site.
Call with the Media:
BCE will hold a teleconference for media on Wednesday, October 23, 2002 at
12:30 PM (Eastern). Michael Sabia will be present for this teleconference.
Interested participants are asked to dial (800) 273-9672 or (416) 695-5806
between 12:20 PM and 12:28 PM. If you are disconnected from the call, simply
redial the number. If you need assistance during the teleconference, you can
reach the operator by pressing "0". This teleconference will also be Webcast
live (audio only) on our Web site at www.bce.ca.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
Certain statements made in this press release, including, but not limited to,
the statements appearing under the "Outlook" section, and other statements that
are not historical facts, are forward-looking and are subject to important
risks, uncertainties and assumptions. The results or events predicted in these
forward-looking statements may differ materially from actual results or events.
These statements do not reflect the potential impact of any dispositions,
monetizations, mergers, acquisitions, other business combinations or other
transactions that may be announced after the date hereof.
Other factors which could cause results or events to differ materially from
current expectations include, among other things: the timing and extent of
economic expansion in Canada and of improvement in consumer confidence and
spending; the level of demand and prices for data, IP broadband and voice
services; BCE's ability to manage costs and generate productivity improvements;
the financial condition and credit risk of customers and uncertainties regarding
collectibility of receivables; uncertainty as to whether BCE's strategies will
yield the expected benefits, synergies and growth prospects; the intensity of
competitive activity, and its resulting impact on the ability to retain
existing, and attract new, customers, and the consequent impact on pricing
strategies, revenues and network capacity; the level of capital expenditures
necessary to expand operations, increase the number of customers, provide new
services, build and update networks and maintain or improve quality of service;
the availability and cost of capital required to implement BCE's financing plan
and fund capital and other expenditures; the Internet economy growing at a
slower pace than is currently anticipated; the ability to deploy new
technologies and offer new products and services rapidly and achieve market
acceptance thereof; the ability to carry out cross selling of the various
services offered by the BCE group of companies; stock market volatility; the
risk of credit rating downgrades; the availability of, and ability to retain,
key personnel; the impact of adverse changes in laws or regulations or of
adverse regulatory initiatives or proceedings (including the outcome of the
appeal of the CRTC's price cap decision); the possibility of further
deterioration in the state of capital markets and the telecommunications
industry; BCE's ability to implement its financing plan in order to finance
the purchase of SBC Communications Inc.'s remaining minority interest in Bell
Canada (including the risk of not completing the debt offering); the risk that
the closing of the Bell Canada directories sale may be delayed or not occur;
and the final outcome of pending or future litigation.
For additional information with respect to certain of these and other factors,
refer to BCE's 2002 quarterly MD&As filed by BCE with the U.S. Securities and
Exchange Commission under Form 6-K and with the Canadian securities commissions.
The forward-looking statements contained in this press release represent BCE's
expectations as of October 23, 2002 and, accordingly, are subject to change
after such date. However, BCE disclaims any intention or obligation to update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
For further information:
Nick Kaminaris Isabelle Morin
Communications Investor Relations
(514) 786-3908 (514) 786-3845
Web Site: www.bce.ca
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(1) EBITDA is defined as operating revenues less operating expenses and
therefore reflects earnings before interest, taxes, depreciation and
amortization, as well as any non-recurring items. BCE uses EBITDA,
amongst other measures, to assess the operating performance of its
on-going businesses. The term EBITDA does not have a standardized
meaning prescribed by Canadian generally accepted accounting principles
and therefore may not be comparable to similarly titled measures presented
by other publicly traded companies. EBITDA should not be construed as the
equivalent of net cashflows from operating activities.
(2) Refer to the discussion under the caption "Overview" for further details.
(3) Other items for the third quarter of 2001 included discontinued operations
of $370 million (excluding goodwill amortization), after-tax gains on sale
of investments and dilution gains of $153 million, and other after-tax
charges of $48 million.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BCE Inc.
(Signed Michael T. Boychuk)
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Michael T. Boychuk
Senior Vice-President and Corporate Treasurer
Date: October 23, 2002