BCE's severance costs drag down Q4 profit; revenue in line with estimates

MONTREAL -- The parent of Bell Canada, CTV and related businesses has recorded $120 million of severance-related expenses in the fourth quarter.

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BCE Inc. (TSX:BCE) revealed the cost of the workforce adjustments with its latest financial report, which showed it had $496 million of net income for the fourth quarter -- down 8.5 per cent from $542 million a year before.

The Montreal-based company attributed the lower profit to higher severance, acquisition and other costs during the three months ended Dec. 31, totalling $152 million including the severance expenses.

BCE's adjusted net earnings, excluding those expenses, increased 0.8 per cent to $615 million in the quarter ended Dec. 31, up $5 million from a year earlier.

The adjusted net earnings -- which are one of BCE's key measures of financial performance -- met analyst estimates at 72 cents per share. But the net income fell short at 58 cents per commen share, down from 64 cents a year earlier.

BCE's revenue was $5.6 billion, in line with estimates compiled by Thomson Reuters and up 1.4 per cent from the fourth quarter of 2014.

BCE also announced it will be raising its dividend to shareholders by five per cent, starting with the next payment on April 15. The annualized dividend will rise to $2.73 per share, up from $2.60.

The company is projecting its adjusted earnings per share in 2016 will be in a range from $3.45 to $3.55, up from with $3.36 in 2015. Revenue is expected to grow by one to three per cent this year, in line with the 2015 growth rate.


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