Bell Mobility 2005 4th quarter financial results

[Barry]

BCE reported fourth quarter and full year 2005 financial results and announced its financial guidance for 2006. BCE met or exceeded its 2005 guidance for revenue growth, cost reductions, EPS, free cash flow and capital intensity. BCE also provided details of its business plan for 2006 and announced the use of proceeds from recent asset sales and further initiatives in the company's ongoing asset review.

For the full year 2005, BCE reported revenues of $19.1 billion, up 4.0% from the previous year as fourth quarter revenues increased by 4.6% to $5 billion. Operating income for the full year 2005 was $4 billion compared to $2.9 billion the previous year, and operating income for the fourth quarter was $979 million, compared with $814 million in the same quarter last year. EBITDA for the full year reached $7.6 billion, a 2.2% increase compared to 2004, and fourth quarter EBITDA was $1.9 billion, up $64 million or 3.6% over the same period last year.

That performance translated into cash from operating activities of $5.6 billion in 2005, an increase of 2.1% over the previous year. Cash from operating activities in the quarter was $1.6 billion, an increase of 24% over the same period in 2004. Free Cash Flow for the year was $662 million compared to $870 million for 2004, consistent with our revised guidance of $600 million to $800 million. Free cash flow in the quarter was $423 million, compared to the negative $121 million recorded in the fourth quarter of 2004. EPS were $2.04 for the full year 2005 compared to $1.65 for 2004, and were $0.44 in the fourth quarter compared to $0.45 for the same period in 2004. 2005 EPS before restructuring and other items and net gains on investments were $2.05 compared to $2.02 reported for 2004; and in the fourth quarter were $0.46 compared to $0.45 in the fourth quarter of 2004.

Wireless Segment:

With record gross additions for the year and the introduction of new, innovative services (EVDO, 10-4, MobiTV, Seek & Find, MSN Messenger) Bell's wireless unit expanded both its customer base and its revenue base.

- Total wireless customers grew to 5,441,000 compared to 4,925,000 at year-end 2004, a 10.5% increase
- A record of 455,000 gross activations in the quarter as the company
continues to secure new high value subscribers in both the
residential and business markets
- 74% of the customer base is on post-paid rate plans
- Net activations totalled 210,000 in the quarter, compared to 217,000
in the fourth quarter of 2004
- Pre-paid ARPU for the year was $14, up 16.7% over 2004; post-paid
ARPU for the year was $61, essentially unchanged from the previous
year
- In the fourth quarter, pre-paid ARPU was $14 per month, up from $13
the same quarter in 2004; fourth quarter post-paid ARPU was $64 per
month, an increase of $3 over the fourth quarter of 2004
- Wireless revenues increased by 9.9% to $3.1 billion for the full
year and by 9.5% to $812 million in the fourth quarter
- Wireless EBITDA in the year was $1,307 million, up by 10.1% over
2004; and wireless EBITDA for the fourth quarter reached
$311 million, an increase of 13.5% over the fourth quarter in 2004
- Overall churn for the year was 1.6% as compared to 1.3% for 2004

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