With Astral Media Deal in Limbo, Canada's BCE Posts Lower Q3 Earnings
TORONTO – With its $3.38 billion takeover deal for Astral Media in limbo, Canadian phone giant BCE Inc. on Thursday posted reduced third quarter earnings due to a soft ad market.
The Q3 profit came to $569 million, against earnings of $642 million in 2011, when BCE recorded lower income tax expenses.
Combined revenue was up 1.8 percent to $4.4 billion, with the traditional wireline phone division posting $2.5 billion in revenue, down 4 percent from 2011, while the wireless phone division recorded another $1.43 billion in revenue, up 7 percent year-on-year.
And the media division, supported by increased radio, TV and digital ad sales from broadcasting the 2012 London Games, posted revenue up 25.5 percent to $546 million.
But stripping out the Olympics, Q3 ad sales across the Bell Media division were impacted by a soft ad market.
BCE also faces an uphill battle to get its way with a proposed takeover of rival broadcaster Astral Media.
The CRTC earlier this month denied approval of the bid on competition grounds, and BCE has appealed to the federal cabinet.
But federal ministers in Ottawa have signalled in recent days that they are unlikely to intervene to overturn the CRTC decision.
That’s likely to send BCE to the federal court of appeals, or back to the drawing board to increase its competitive edge in Quebec, where Astral Media is headquartered and it faces stiff competition from rival Quebecor Media.