Bell Aliant posts $84M in Q1 net earnings, revenue up $2M to $684M

HALIFAX – Regional telecom company Bell Aliant earned a first-quarter profit of nearly $84 million as gains by its Internet and TV business helped offset lower revenue from local and long-distance telephone services.

The company said Wednesday the profit amounted to 36 cents for the quarter ended March 31 compared with a profit of $82 million or 36 cents per share a year ago.

Operating revenue increased $2 million to $684 million.

“Returning to revenue growth is a key milestone in our strategy and our first-quarter results have us off to a great start for 2013, chief executive Karen Sheriff said in a news release.

Desjardins analyst Maher Yaghi said the results that were in line with expectations.

“We believe the company’s strategy to turn around its revenue base is continuing to show positive results,” Yaghi said in a research note.

Yaghi noted revenue beat expectations of $679 million for the quarter, an improvement after many years of decline, and adjusted earnings per share of 46 cents came in ahead of expectations of 43 cents.

Bell Aliant (TSX:BA) has said that its fibre optic network is key to long-term profitability.

The network allows faster Internet downloads of data such as music or movies and the ability to share video and photos faster. It is also used for high-definition television.

The company said more than 679,000 premises had access to its FibreOP services. The company has said it expects about 800,000 premises to be served by the end of this year with about 5,000 more added in the quarter compared to the same quarter last year.

Bell Aliant said total data revenue including Internet and TV was $255.6 million compared with $236.7 million, up 19 per cent year-over-year.

The company added 8,697 net high-speed Internet subscribers in the quarter for its high-speed Internet services, compared with 6,359 year-over-year. Total high-speed Internet customers were 927,100 at the end of March 2013.

It also added 14,250 net new IPTV customers in the quarter versus 7,874 in the same quarter last year. IPTV customers totalled 137,270 at the end of the quarter.

Wireless revenues were up $2 million, or 6.1 per cent, to $28 million in the first quarter of 2013 compared with the same quarter in 2012.

Meanwhile, local phone service revenues fell $14 million or almost five per cent to $281.2 million from $295.6 million. Long distance revenue dropped to $76.6 million from $85.1 million year-over-year.

Bell Aliant Inc. holds an investment in Bell Aliant Regional Communications Inc. (Bell Aliant GP), which provides regional telecommunications services in Atlantic Canada, Ontario and Quebec.

Shares in Bell Aliant closed up 10 cents to $27.04 on the Toronto Stock Exchange.