TORONTO — BCE Inc., the parent company of Bell Media, which enjoys a close relationship with iHeartMedia at its Canadian AM and FM radio stations, has reported third quarter 2022 earnings per share that surpassed the Zacks Consensus Estimate. Total operating revenue also beat the Zacks forecast.
That said, its “fast, reliable wireless networks” and “highest-ever number of total mobile phone net additions” — a surge that is likely tied to consumer ire over the July 8 Rogers service outage impacting some 12 million customers — is what’s driving the Bell growth.
It’s not the Bell Media division, which is suffering from weak ad revenue.
Bell Media’s Q3 2’22 operating revenue was unchanged compared to Q3 2021, finishing at $719 million.
One key reason for the dip is a 2.3% decline in advertising revenue, reflecting “softer TV advertiser demand and a slow radio recovery from COVID due to the current macroeconomic backdrop.”
This, BCE said, was partly offset by improved year-over-year out of home performance as well as continued strong digital growth. Additionally, advertising revenue generated in Q3 2021 from the federal election, UEFA Euro Cup and Tokyo Summer Olympics did not recur this year.
Still, Canada’s largest communications company has hurdles to climb. On the television side, it is the owner of the CTV network, regularly No. 1 over Global, the CBC and CityTV. It also owns TSN, Canada’s answer to ESPN; Much, the nation’s long-standing version of MTV; and News-focused CP24. Its radio stations total 109, and are found across 58 markets. Many carry national brands, such as Virgin Radio and Pure Country radio. In Québec, it owns Rouge FM and Energie. On the local level, storied contemporary hits CHUM-FM in Toronto is a Bell Media property. In Montréal, News/Talk CJAD-AM and Rock CHOM-FM are Bell Media stations.
Higher subscriber revenue is thanks to Bell Media’s popular OTT offering Crave.
Digital revenues were up 40%, the result of continued strong Crave direct-to-consumer growth and increased bookings from Bell Media’s strategic audience management (SAM) TV media sales tool. Total Crave subscriptions increased 7% from last year to approximately 3.1 million subscribers.
Nevertheless, Bell Media’s Q3 2022 adjusted EBITDA was down 15.3% to $182 million, resulting in a 4.6 percentage-point margin decline to 25.3%. This was due to the year-over-year decline in advertising revenue and a 6.5% increase in operating costs, driven by the return this year to regular sports broadcast schedules and normalization of entertainment programming content deliveries.
With the Closing Bell on the TSX, BCE was up 75 cents to $45.86 CDN.
