BCE reports second quarter 2013 results

BCE reports second quarter 2013 results

2013 financial guidance increased


-- Wireless postpaid net activations of 96,390 and 2.7% higher
blended ARPU drive wireless service revenue growth of 6.1%;
Wireless service margin increases to 45.9%
-- Best-ever Bell Fibe TV net customer activations of 50,555, a
31.4% increase; network access service (NAS) landline losses
improve 12.8%
-- Bell EBITDA up 1.5% on Wireless and Media EBITDA growth of 8.9%
and 3.3%, respectively, as consolidated Bell EBITDA margin held
steady at 39.4%
-- Improving Wireline revenue and EBITDA results as operating mix
increasingly dominated by TV and Internet growth services
-- Net earnings attributable to common shareholders of $571
million, or $0.74 per common share; Adjusted earnings per share
of $0.77 in line with plan
-- Strong 12% growth in free cash flow to $903 million
-- Acquisition of Astral Media Inc. (Astral) completed on July 5



This news release contains forward-looking statements. For a description
of the related risk factors and assumptions please see the section
entitled "Caution Concerning Forward-Looking Statements" later in this
release.


MONTREAL, Aug. 8, 2013 /PRNewswire/ - BCE Inc. (TSX, NYSE: BCE),
Canada's largest communications company, today reported BCE and Bell
results for the second quarter (Q2) of 2013, and increased financial
guidance for 2013 to reflect the acquisition of Astral.


FINANCIAL HIGHLIGHTS





($ millions except per share amounts)
(unaudited) Q2 2013 Q2 2012 % change

Bell(i)

Operating revenues 4,424 4,341 1.9%

EBITDA 1,744 1,718 1.5%

BCE

Operating revenues 5,000 4,925 1.5%

EBITDA 2,066 2,044 1.1%

Net earnings attributable to common
shareholders 571 732 (22.0%)

EPS 0.74 0.94 (21.3%)

Adjusted EPS 0.77 0.97 (20.6%)

Cash flows from operating activities 1,868 1,904 (1.9%)

Free cash flow 903 806 12.0%





(i) Bell includes the Bell Wireless, Bell Wireline and Bell Media
segments.







"At Bell, we're dedicated to bringing the world's most advanced
communications services to Canadians - fast-growing mobile LTE and
fibre networks delivering new choices in wireless, TV, Internet, media
and business communications. Bell's unmatched investment in Canada's
broadband infrastructure, innovative new products, and strong execution
by the almost 60,000 members of the Bell national team have resulted in
robust financial performance and rapid expansion in our growth
services," said George Cope, President and CEO of BCE and Bell Canada.



"Increasing smartphone adoption and use of data services like Bell
Mobile TV supported strong revenue and EBITDA growth at Bell Wireless.
Our rapidly expanding Fibe footprint drove the highest number of Fibe
TV customer additions since its launch, as well as growing Internet
performance and improvement in our traditional landline business as
more customers bundled Bell services. And with solid financial
performance in Q2 supported by increased advertising and revenue from
sports and other specialty services, Bell Media remains Canada's top
media company - a competitive position further strengthened with the
addition of the Astral team, especially in the Québec media
marketplace," said Mr. Cope.



Bell is committed to achieving a clear goal - to be recognized by
customers as Canada's leading communications company - through the
execution of 6 Strategic Imperatives: Invest in Broadband Networks &
Services, Accelerate Wireless, Leverage Wireline Momentum, Expand Media
Leadership, Improve Customer Service, and Achieve a Competitive Cost
Structure.



"We delivered a solid set of financial results in Q2, backed by
continued wireless postpaid strength along with good operational
progress in our wireline business and a strong contribution from our
media business," said Siim Vanaselja, Chief Financial Officer for BCE
and Bell. "Our successful closing of the acquisition of Astral supports
the increased 2013 financial guidance we're announcing today. After
absorbing integration and other acquisition-related costs in the second
half of 2013, we expect to begin realizing the full financial benefits
of this acquisition in 2014 with strong free cash flow accretion to
support our dividend growth objective."


BCE RESULTS

BCE's net earnings attributable to common shareholders were $571 million
in Q2 2013, or $0.74 per common share, compared to $732 million, or
$0.94 per common share, in Q2 2012. In line with plan, Adjusted
earnings per share (EPS)((1) )was $0.77 per common share, down $0.20 from last year. The
year-over-year decrease was due to the higher value of uncertain tax
positions favourably resolved in Q2 2012,  losses on equity derivative
contracts entered into to economically hedge future payments under our
share-based compensation plans, and increased interest expense related
to the financing of our acquisition of Astral.



BCE's cash flows from operating activities were $1,868 million in Q2
2013, down $36 million over last year, due largely to the timing of
supplier payments, increased interest payments from a higher average
level of long-term debt, and higher income taxes. Free cash flow((2)) available to BCE's common shareholders increased $97 million, or 12%,
this quarter to $903 million, driven mainly by higher EBITDA((3)) and lower capital expenditures.



At the end of Q2, BCE (including Bell Canada and Bell Aliant) served a
total of 7,860,429 wireless subscribers, up 3.5% from Q2 2012; total TV
subscribers of 2,377,021 (which includes 495,038 IPTV customers), a
5.3% increase; total high-speed Internet subscribers of 3,054,427, up
1.5%; and total NAS lines of 7,851,441, a decrease of 7.0%.


BELL RESULTS

Bell operating revenues in Q2 2013 grew 1.9% to $4,424 million, driven
by a 1.8% increase in service revenues that reflects growth in
wireless, TV, Internet, media and business IP connectivity and
solutions. Product revenues were also up 2.9% this quarter, due to
increased data product sales to large enterprise customers.



Bell EBITDA increased 1.5% to $1,744 million, with 8.9% EBITDA growth at
Bell Wireless and 3.3% at Bell Media. This was moderated by a 2.9%
decrease in Bell Wireline's EBITDA, which represents an improving trend
over Q1 2013 and all previous quarters in 2012. Bell's consolidated
EBITDA margin in Q2 2013 remained relatively unchanged at 39.4%
compared to 39.6% in Q2 2012, reflecting strong wireless revenue
flow-through, controlled spending on wireless subscriber acquisition
and retention, slower wireline voice erosion, the increasing scale of
Bell Fibe TV, and pricing and cost discipline across the company.


LET'S CLOSE THE LOOPHOLES

Bell is urging the federal government to close the loopholes in new
wireless regulations that favour major US wireless carriers like
Verizon Communications Inc. (Verizon) with a range of advantages
originally intended for competitive wireless startups. Bell is always
ready to compete but the playing field needs to be level. Special
benefits available to companies like Verizon include preferred access
to Canada's wireless spectrum, the right to access the networks of
Canadian carriers, and the ability to acquire wireless startups in
Canada that Canadian companies like Bell cannot. Yet Canadian carriers
have no such reciprocal rights in the US or any other country.
Considering the cost to Canadians and the impact on investment,
innovation and employment in Canadian wireless, the campaign to close
the loopholes has received strong support from a broad spectrum of
Canadians. Please visit Bell.ca/PlayFair or FairForCanada.ca to learn more.


ASTRAL ACQUISITION COMPLETED

We welcomed the Astral team to Bell Media following the completion of
the $3.27 billion acquisition of the Montréal-based Astral by Bell on
July 5, 2013. The acquisition means more investment in Canadian media
and choice for consumers, while greatly enhancing Bell Media's
competitive position, especially in the Québec marketplace. Astral
properties acquired include high-quality pay and specialty TV services
(the French-language Super Écran, Cinépop, Canal Vie, Canal D, VRAK TV,
and Ztélé, and English-language services The Movie Network, including
HBO Canada, and TMN Encore), one of Canada's largest out-of-home
advertising businesses, and 77 radio stations, including top brands
like NRJ, Virgin Radio, Rouge fm, EZ Rock. Ian Greenberg, President and
CEO of Astral, joined BCE's Board of Directors at the close of the
transaction.


BELL OPERATING RESULTS BY SEGMENT

Bell delivered strong execution across all its business segments in Q2
2013. Bell Wireless maintained strong market momentum with considerable
postpaid customer activations and operating metrics that improved
subscriber profitability. We also saw an acceleration in Fibe TV net
customer activations, fewer NAS landline losses, better Bell Business
Markets performance, and disciplined cost management across the
company, all of which contributed to further improvement in Bell
Wireline's revenue and EBITDA trajectories. Bell Media's continued
significant contribution to consolidated Bell EBITDA and cash flow
growth this quarter supports the transformation of Bell's growth
services mix profile, which will be further enhanced with the
acquisition of Astral.



Bell invested $673 million in new capital in Q2 2013 to support the
continued deployment of next-generation wireline and wireless broadband
platforms. This represents a 13.3% decrease compared to Q2 2012, due to
higher initial rollout costs last year for the construction of Bell's
4G LTE mobile network in major urban markets and the rapid retail store
expansion in Western Canada, as well as the timing of capital spending
in 2013 compared to last year.


Bell Wireless

Bell Wireless operating revenues increased 5.4% to $1,442 million in the
quarter compared to $1,368 million in Q2 2012. Service revenues were up
6.1% to $1,328 million driven by postpaid subscriber growth and higher
blended ARPU reflecting increased data usage and revenues from greater
smartphone penetration. Wireless data revenue grew 21.1% in Q2 and now
represents more than 40% of total wireless service revenues.



Bell Wireless EBITDA increased 8.9% to $609 million, reflecting the
combined impact of higher operating revenues and disciplined handset
discounting for new customer acquisitions and upgrades. This
contributed to a 1.3 percentage-point improvement in service margin to
45.9% from 44.6% in Q2 2012, the best performance in 4 years.



-- Postpaid net additions of 96,390 reflected a 2.7% increase in
postpaid gross activations compared to Q2 2012 and stable
customer churn. Higher postpaid gross activations were driven
by a strong lineup of smartphones and other mobile devices,
attractive promotions and effective advertising. Prepaid net
customer losses improved 3.7% to 52,824 as a result of fewer
customer deactivations.

-- Smartphone users represented 70% of total postpaid subscribers
at the end of the quarter, compared to 55% a year earlier. Bell
Wireless customers totalled 7,715,641 at the end of Q2, an
increase of 3.5%.

-- Postpaid customer churn remained low and unchanged at 1.3%,
reflecting continued investments in customer service and
retention. Prepaid churn also remained unchanged at 3.7% this
quarter.

-- Blended ARPU increased 2.7% to $56.85 in the quarter,
representing the fourteenth consecutive quarter of
year-over-year improvement. Growth was driven by a higher
proportion of postpaid customers in our overall wireless
subscriber base, growth in data usage due to strong smartphone
adoption, and postpaid customer growth in higher-ARPU customer
segments and regions such as Western Canada.

-- Cost of acquisition increased 5.5% to $402 per gross
activation, reflecting higher handset discounts driven by a
higher postpaid smartphone mix and competitive handset pricing
in the market.

-- Bell continues to offer customers access to Canada's largest 4G
LTE network reaching approximately 73% of the Canadian
population, complementing the 4G HSPA+ and enhanced 4G HSPA+ DC
(Dual Cell) networks that offer coast-to-coast coverage to more
than 97% and more than 92% of the population, respectively.

-- Bell Mobile TV announced expanded live and on-demand
programming with the addition of CBC, Radio-Canada TV, City TV,
Sportsnet and BBC World News. Now with more than 30 channels in
English and French available on smartphones and tablets, Bell
Mobile TV offers access to news, entertainment and children's
programming from brands such as ATN, BNN, BBC, Bloomberg, CTV,
City TV, Juicebox, MTV Canada, Treehouse, TVA and YTV, and
sports content from TSN, RDS, Sportsnet and the NHL, NBA and
NFL.

-- Royal Bank of Canada (RBC) and Bell Mobility have announced
that customers will be able to pay securely for transactions
with their RBC debit or credit cards using compatible Bell
Mobility smartphones. RBC and Bell expect to make the service
broadly available by the end of the year and are now testing
the solution with consumers and merchant customers.

-- Bell Wireless continued to bring customers the latest in
wireless technology with the introduction of several new
in-demand devices, including the BlackBerry Q10, the HTC One,
the Samsung Galaxy S4 and the Sony Xperia ZL. These smartphones
are all equipped with Near Field Communications (NFC)
capability, enabling mobile commerce applications and easy
wireless sharing of music, contacts, files and images.

-- Bell renewed its partnership with GLENTEL, Canada's largest
independent multi-carrier mobile phone retailer, to offer Bell
Mobility products and services to customers at GLENTEL retail
outlets across Canada, including Wireless Wave, Telephone
Booth, Wireless Etc. and Target Mobile.



Bell Wireline

The pace of Bell Wireline's revenue decline improved significantly in
the quarter with revenues decreasing by a modest 0.9% to $2,506
million, as growth in Fibe TV and Fibe Internet drove stronger overall
residential financial results. This moderated the decline in voice
revenues, reflecting fewer NAS landline losses compared to Q2 2012.
Bell Business Markets generated higher IP connectivity revenues and saw
increased data product sales to large enterprise customers this
quarter.



Bell Wireline EBITDA decreased 2.9% to $979 million and we maintained
margin on plan at 39.1% (compared to 39.9% in Q2 2012). The decrease in
Wireline EBITDA this quarter was impacted by a $10 million benefit
realized in Q2 2012 from an adjustment to TV broadcast licence fees
payable to the CRTC that did not recur this year. Excluding this
impact, Bell Wireline EBITDA decreased 1.9% this quarter.



-- Bell Fibe TV added 50,555 net new customers, a 31.4% increase
over the 38,477 gained in the second quarter of 2012. This
represents our best quarterly performance since launching the
service in Q3 2010, reflecting growth in customer demand for
Fibe TV as we continue to expand our IPTV service footprint. At
the end of Q2, Bell Fibe TV subscribers totalled 346,316, more
than double the 158,324 subscribers reported at the end of Q2
2012.

-- In May 2013, Bell Fibe TV launched Canada's first wireless
receiver, a Bell exclusive that enables customers to connect
additional TVs with Fibe TV service anywhere in the home
without the need to run extra cable. A wireless receiver
transmitter connects to a customer's Home Networking modem and
works with their Whole Home personal video recorder (PVR) to
connect one or more Wireless Receivers to deliver the full Fibe
TV experience to as many as 5 additional TVs.

-- Combined Bell Satellite TV and Fibe TV net additions in the
quarter increased 52.8% to 25,605. Bell TV's subscriber base
totalled 2,195,559 at the end of Q2 2013, representing a 3.2%
increase since the end of Q2 2012.

-- Bell high-speed Internet net subscriber additions were 3,901,
compared to a net loss of 664 in Q2 2012, reflecting the
pull-through of Bell Fibe TV customer activations as well as
improved business and wholesale customer activations. Bell
total high-speed Internet subscribers reached 2,121,075, up
0.8% since the end of Q2 2012.

-- Wireline data revenue was up 4.0% to $1,456 million, driven
mainly by higher TV and Internet service revenues as a result
of Fibe customer growth, higher IP broadband connectivity
revenues and increased data product sales.

-- Residential NAS net losses improved 11.8%, or 11,029, over Q2
2012, reflecting lower rates of residential NAS turnover in
Bell Fibe TV service areas and fewer wholesale customer losses
to competitors compared to the second quarter of last year.

-- Business NAS losses improved 15.3%, or 5,206, this quarter as
Bell Business Markets reduced access line losses in its
mid-sized customer segment. Wholesale business access line
losses also improved year over year.

-- Total Bell NAS at the end of the quarter was 5,425,491, a 7.7%
decline. Bell's local and access revenues declined 7.1% to $632
million, while long distance revenue declined 11.2% to $183
million.

-- Bell and CGI Group Inc. (CGI) teamed up on a winning bid to
deliver a new email system for the federal government. Based on
the latest email technology, the streamlined system will
enhance security and increase efficiency, ultimately improving
Canadians' access to information and services while saving the
government a projected $50 million per year starting in 2015.
Bell and CGI will implement and manage the government's new
email system for 7 years with an optional 1-year extension.



Bell Media

Bell Media revenues grew 4.7% to $559 million in the quarter, due to
subscriber fee revenue growth of 7.9% reflecting increases in specialty
TV rates paid by broadcast distributors. Advertising revenues were up
0.8% compared to Q2 2012, with growth driven by Bell Media's specialty
sports TV properties, TSN and RDS, thanks to the NHL's regular season
schedule being extended into Q2 and intense viewer interest in the
hockey playoffs. Bell Media's conventional TV properties also had
higher advertising sales compared to Q2 2012. This growth was offset by
a year-over-year decline in digital advertising revenues and softer
radio advertising sales.



As a result of higher operating revenues, Bell Media EBITDA increased
3.3% to $156 million, despite the non-recurring benefit realized in Q2
2012 totalling $15 million from accrual adjustments to CRTC Part II
fees and the Local Programming Improvement Fund, and higher programming
and production costs this quarter due to the NHL's extended schedule.



-- CTV wrapped up the 2012/13 broadcast year with more top 10, top
20 and top 30 shows than any other Canadian conventional TV
networkaccording to BBM Canada, making it the most-watched
Canadian TV network for the 12th year in a row.

-- Bell Media's sports and non-sports TV specialty services
reached nearly 26 million Canadians in the average week
throughout Q2 2013, over 6 million viewers more than the
closest competitor.

-- At the annual Los Angeles programming screenings in May, Bell
Media secured an attractive mix of returning and new programs
for its 2013/2014 primetime schedules on its CTV and CTV Two
networks, featuring more returning hits than any other Canadian
network along with a number of new programs for the fall and
mid-seasons. CTV will also remain the home of TV's biggest
events in 2013/2014, including the Academy Awards, Super Bowl,
the Golden Globe Awards, the Primetime Emmy Awards, the
American Music Awards and the Juno Awards.



BELL ALIANT RESULTS

Bell Aliant (TSX: BA) revenues increased 0.6% to $691 million in Q2 2013
from $687 million in Q2 2012, as growth in data was largely offset by
continued declines in local and access and long distance revenues, as
well as equipment and other revenues. Bell Aliant's EBITDA was down
1.2% at $322 million this quarter, as slightly higher operating
revenues were offset by a 2.2% increase in operating costs related
mostly to growth of its FibreOP service. For more information, please
visit BellAliant.ca.


COMMON SHARE DIVIDEND

BCE's Board of Directors has declared a quarterly dividend of $0.5825
per common share, payable on October 15, 2013 to shareholders of record
at the close of business on September 16, 2013.


OUTLOOK

As a result of the closing of the acquisition of Astral on July 5, 2013,
BCE has updated its financial guidance for 2013 as follows:






February 7 August 8
Guidance Guidance

Bell (i)

Revenue Growth 0% - 2% 2% - 4%

EBITDA Growth 1% - 3% 3% - 5%

Capital Intensity 16% - 17% No change

BCE

Adjusted EPS (ii) $2.97 - $3.03 No change

Free Cash Flow growth (iii) 5% - 9% No change

Annual common dividend per share $2.33 No change





(i) Bell's 2013 financial guidance for revenue, EBITDA and capital
intensity is exclusive of Bell Aliant.

(ii) We define Adjusted net earnings as net earnings attributable to
common shareholders before severance, acquisition and other
costs, net (gains) losses on investments and premiums on early
redemption of debt. We define Adjusted EPS as Adjusted net
earnings per BCE Inc. common share.

(iii) We define free cash flow as cash flows from operating
activities excluding acquisition costs paid and voluntary
pension funding, plus dividends/distributions received from
Bell Aliant, less capital expenditures, preferred share
dividends, dividends/distributions paid by subsidiaries to
non-controlling interest, and Bell Aliant free cash flow.






CALL WITH FINANCIAL ANALYSTS

BCE will hold a conference call for financial analysts to discuss Q2
2013 results on Thursday, August 8 at 8:00 a.m. (Eastern). Media are
welcome to participate on a listen-only basis. To participate, please
dial (416) 340-8061 or toll-free 1-866-225-0198 shortly before the
start of the call. A replay will be available for one week by dialing
(905) 694-9451 or 1-800-408-3053 and entering pass code 3092522#.



There will also be a live audio webcast of the call available on BCE's
website at: BCE.ca/investors/investorevents/all/show/bce-q2-2013-results-conference-call.The mp3 file will be available for download on this page later in the
day.


NOTES

The information contained in this news release is unaudited.






(1) The terms Adjusted net earnings and Adjusted EPS do not have any
standardized meaning under IFRS. Therefore, they are unlikely to be
comparable to similar measures presented by other companies.
Starting in 2013, our definition of Adjusted net earnings has been
modified to exclude premiums on early redemption of debt to align
with the reporting practices of our peers. We define Adjusted net
earnings as net earnings attributable to common shareholders before
severance, acquisition and other costs, net (gains) losses on
investments, and premiums on early redemption of debt. We define
Adjusted EPS as Adjusted net earnings per BCE common share. We use
Adjusted net earnings and Adjusted EPS, among other measures, to
assess the performance of our businesses without the effects of
severance, acquisition and other costs, net (gains) losses on
investments, and premiums on early redemption of debt, net of tax
and non-controlling interest. We exclude these items because they
affect the comparability of our financial results and could
potentially distort the analysis of trends in business performance.
Excluding these items does not imply they are non-recurring. The
most comparable IFRS financial measures are net earnings
attributable to common shareholders and EPS. The following table is
a reconciliation of net earnings attributable to common
shareholders and EPS to Adjusted net earnings on a consolidated
basis and per BCE common share (Adjusted EPS), respectively.







($ millions except per share
amounts)

Q2 2013 Q2 2012

TOTAL PER SHARE TOTAL PER SHARE

Net earnings attributable to
common shareholders 571 0.74 732 0.94

Severance, acquisition and other
costs 21 0.02 15 0.03

Net gains on investments (1) - - -

Premium on early redemption of
debts 3 0.01 - -



Adjusted net earnings 594 0.77 747 0.97







(2) The term free cash flow does not have any standardized meaning
under IFRS. Therefore, it is unlikely to be comparable to similar
measures presented by other companies. Starting in 2013, our
definition of free cash flow has been modified to exclude voluntary
pension funding because it is a discretionary use of excess cash.
We define free cash flow as cash flows from operating activities,
excluding acquisition costs paid and voluntary pension funding,
plus dividends/distributions received from Bell Aliant, less
capital expenditures, preferred share dividends,
dividends/distributions paid by subsidiaries to non-controlling
interest, and Bell Aliant free cash flow. We consider free cash
flow to be an important indicator of the financial strength and
performance of our business because it shows how much cash is
available to repay debt and reinvest in our company. We believe
that certain investors and analysts use free cash flow to value a
business and its underlying assets. The most comparable IFRS
financial measure is cash flows from operating activities. The
following table is a reconciliation of cash flows from operating
activities to free cash flow on a consolidated basis.







($ millions)

Q2 2013 Q2 2012

Cash flows from operating activities 1,868 1,904

Bell Aliant dividends/distributions to BCE 47 47

Capital expenditures (830) (952)

Cash dividends paid on preferred shares (32) (34)

Cash dividends/ distributions paid by subsidiaries
to non-controlling interest (74) (91)

Acquisition costs paid 8 32

Bell Aliant free cash flow (84) (100)

Free cash flow 903 806







(3) The term EBITDA does not have any standardized meaning under IFRS.
Therefore, it is unlikely to be comparable to similar measures
presented by other companies. We define EBITDA as operating
revenues less operating costs, as shown in BCE's consolidated
income statements. We use EBITDA to evaluate the performance of our
businesses as it reflects their ongoing profitability. We believe
that certain investors and analysts use EBITDA to measure a
company's ability to service debt and to meet other payment
obligations or as a common measurement to value companies in the
telecommunications industry. EBITDA also is one component in the
determination of short-term incentive compensation for all
management employees. EBITDA has no directly comparable IFRS
financial measure. Alternatively, the following table provides a
reconciliation of BCE net earnings to EBITDA.







($ millions)

Q2 2013 Q2 2012

Net earnings 671 836

Severance, acquisition and other costs 28 20

Depreciation 681 666

Amortization 161 178

Finance costs

Interest expense 228 209

Interest on post-employment benefit obligations 38 33

Other (income) expense 63 (55)

Income taxes 196 157



EBITDA 2,066 2,044






CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements made in this news release, including, but not limited
to, statements relating to our 2013 financial guidance (including
revenues, EBITDA, Capital Intensity, Adjusted EPS and Free Cash Flow),
our business outlook, objectives, plans and strategic priorities, BCE's
2013 annualized common share dividend, the strategic and other benefits
expected to result from the Astral acquisition, the expectation that
Astral will be accretive to BCE's free cash flow, and other statements
that are not historical facts, are forward-looking. Forward-looking
statements are typically identified by the words assumption, goal, guidance, objective, outlook, project, strategy,
target and other similar expressions or future or conditional verbs such as aim, anticipate, believe, could, expect, intend, may, plan, seek, should, strive and will. All such forward-looking statements are made pursuant to the 'safe
harbour' provisions of applicable Canadian securities laws and of the
United States Private Securities Litigation Reform Act of 1995.



Forward-looking statements, by their very nature, are subject to
inherent risks and uncertainties and are based on several assumptions,
both general and specific, which give rise to the possibility that
actual results or events could differ materially from our expectations
expressed in or implied by such forward-looking statements and that our
business outlook, objectives, plans and strategic priorities may not be
achieved. As a result, we cannot guarantee that any forward-looking
statement will materialize and you are cautioned not to place undue
reliance on these forward-looking statements. The forward-looking
statements contained in this news release describe our expectations as
of August 8, 2013 and, accordingly, are subject to change after such
date. Except as may be required by Canadian securities laws, we do not
undertake any obligation to update or revise any forward-looking
statements contained in this news release, whether as a result of new
information, future events or otherwise. Except as otherwise indicated
by BCE, forward-looking statements do not reflect the potential impact
of any non-recurring or other special items or of any dispositions,
monetizations, mergers, acquisitions, other business combinations or
other transactions that may be announced or that may occur after August
8, 2013. The financial impact of these transactions and non-recurring
and other special items can be complex and depends on the facts
particular to each of them. We therefore cannot describe the expected
impact in a meaningful way or in the same way we present known risks
affecting our business. Forward-looking statements are presented in
this press release for the purpose of assisting investors and others in
understanding certain key elements of our expected 2013 financial
results, as well as our objectives, strategic priorities and business
outlook for 2013, and in obtaining a better understanding of our
anticipated operating environment. Readers are cautioned that such
information may not be appropriate for other purposes.


Material Assumptions

A number of economic, market, operational and financial assumptions were
made by BCE in preparing its forward-looking statements for 2013
contained in this news release, including, but not limited to:


Canadian Economic and Market Assumptions


-- Growth in the Canadian economy of 1.8% in 2013, based on the
Bank of Canada's most recent estimate, a thirty basis point
increase compared with an earlier estimate of 1.5%;
-- a slow pace of employment growth and new business formation
affecting overall business customer demand;
-- a sustained level of wireline and wireless competition in both
consumer and business markets;
-- higher wireline replacement, due primarily to increasing
wireless and Internet-based technological substitution;
-- increasing wireless industry penetration driven, in particular,
by the accelerated adoption of smartphones, tablets and data
applications, the expansion of LTE service in most urban and
suburban markets, the proliferation of 4G devices, as well as
population growth; and
-- a soft advertising market for Bell Media.



Operational Assumptions Concerning Bell Wireline (Excluding Bell Aliant)


-- Stabilizing residential NAS line erosion rate as we leverage
our broadband investment in FibeTV to drive three-product
household penetration, increase our multiple-dwelling unit
(MDU) market share, and generate higher pull-through attach
rates for our residential Internet and Home Phone services;
-- in particular, targeted retention and service bundle offers,
customer winbacks and better service execution to contribute to
the improvement in residential NAS line losses year over year,
subject to the risk of more aggressive service bundle offers
from our cable TV competitors and increasingly affordable
Canada-wide unlimited wireless plans, which could lead to
higher residential NAS line losses;
-- increased subscriber acquisition at Bell TV to be driven by
increased customer adoption of Fibe TV, as we further extend
our IPTV broadband fibre footprint in areas of Ontario and
Québec, and our ability to seek greater penetration within the
MDU market, capitalize on our extensive retail distribution
network, which includes The Source, and leverage our market
leadership position in high definition (HD) programming;
-- improved subscriber acquisition at Bell Internet through
increased fibre coverage and speeds as we leverage our
significant network capital investment and the implementation
of new technologies to drive greater Fibe TV expansion and
Internet attach rates;
-- gradual improvement in the performance of our Business Markets
unit based on increased business customer spending, new
business formation and higher demand for connectivity and ICT
services driven by a strengthening economy and an improvement
in employment rates, subject to the risk of business customers
adopting more conservative strategies which could result in
lower capital spending requirements and deferral of ICT
projects;
-- continued customer migration to IP-based systems, increased
competitive intensity in mass and mid-sized business segments
as cable operators and other telecom competitors continue to
intensify their focus on the business segment and ongoing
competitive reprice pressures in our business and wholesale
markets; and
-- cost savings to be achieved from management workforce attrition
and retirements, call center efficiencies, field service
productivity improvements, further reduction in supplier
contract rates, lower print and mail costs, effective content
cost management and reducing traffic that is not on our own
network.



Operational Assumptions Concerning Bell Wireless (Excluding Bell Aliant)


-- Bell Wireless to benefit from the flow-through of investments
made in 2012 in customer acquisition and retention, along with
continued strength in smartphone activations and data usage;
-- continued aggressive competition in 2013 as competitors attempt
to maintain or gain wireless market share;
-- wireless revenue growth to be underpinned by continued growth
in our subscriber base and ARPU, driven by a higher mix of
smartphone and higher-value postpaid customers, increased
distribution in western Canada, new services, and continued
disciplined price management;
-- Bell Wireless to benefit from ongoing technological
improvements by manufacturers in our handset and device line-up
and from faster data speeds that are allowing our clients to
optimize the use of our services; and
-- the proliferation of more expensive and sophisticated wireless
devices, as well as heightened competitive activity, to exert
pressure on EBITDA, due mainly to increased handset discount
resulting in higher subscriber acquisition and customer
retention costs.



Operational Assumptions Concerning Bell Media


-- The non-recurrence, in 2013, of significant events that
occurred in 2012, including the London Summer Olympic Games,
the NHL lockout and retroactive rate increases for specialty
programming services;
-- the intended launch, in 2013, of our TV Everywhere product, a
strategic initiative aimed at enabling us to deliver the best
live sports, news and other premium content exclusively to
broadcasting distribution undertakings' (BDUs) subscribers;
-- growth in subscriber revenues to be driven by contracted
market-based rate increases for our specialty sports services;
-- in conventional TV, building and maintaining strategic supply
arrangements for content on four screens, continuing to
successfully acquire high-rated programming and differentiated
content to execute on Bell's multi-screen content strategy,
producing and commissioning high-quality Canadian content, and
producing market-leading news through investments in HD
broadcasting and improvements to our news programming;
-- increased costs to secure content in our sports broadcast
operations as we face greater competition from both new
entrants and established competitors, and as market rates for
specialty content generally increase;
-- in our non-sports English and French pay and specialty TV
services, investment in quality programming and production,
marketing and ongoing development of key brand partnership
initiatives with respect to our existing services;
-- pursuant to the Astral acquisition, the achievement of cost
reductions by maximizing assets, achieving productivity gains
and pursuing operational efficiencies; and
-- the continued leverage of our strength in local radio and
television markets to provide listeners and viewers with
quality content, incorporating opportunities for multi-platform
selling.



Financial Assumptions Concerning Bell (Excluding Bell Aliant)


The following constitute Bell's principal financial assumptions for
2013.  Where indicated below, assumptions have been updated from Q1
2013 as a result of the acquisition of Astral.



-- Bell's total employee benefit plans cost to be approximately
$350 million, instead of $340 million, based on an estimated
accounting discount rate of 4.4% and an expected return on plan
assets of 4.4%, comprised of an estimated above EBITDA employee
benefit plans service cost of approximately $230 million,
instead of $220 million, and an estimated below EBITDA net
employee benefit plans financing cost of approximately $120
million;
-- total pension plan cash funding to be approximately $350
million;
-- cash taxes to be approximately $325 million, instead of $300
million;
-- net interest expense of approximately $750 million, instead of
$700 million;
-- net interest payments of approximately $720 million, instead of
$700 million; and
-- cash severance and other of approximately $150 million.



Financial Assumptions Concerning BCE


The following constitute BCE's principal financial assumptions for 2013.
Where indicated below, assumptions have been updated from Q1 2013 as a
result of the acquisition of Astral.



-- BCE's total employee benefit plans cost to be approximately
$430 million, instead of $420 million, including approximately
$80 million for Bell Aliant, comprised of an estimated above
EBITDA employee benefit plans service cost of approximately
$290 million, instead of $280 million, and an estimated below
EBITDA net employee benefit plans financing cost of
approximately $140 million;
-- depreciation and amortization expense approximately $50 million
higher compared to 2012;
-- net interest expense of approximately $925 million, instead of
$875 million;
-- tax adjustments (per share) of approximately $0.07;
-- an effective tax rate of approximately 26%;
-- non-controlling interest similar to 2012; and
-- an annual common share dividend of $2.33 per share.




The foregoing assumptions, although considered reasonable by BCE on
August 8, 2013, may prove to be inaccurate. Accordingly, our actual
results could differ materially from our expectations as set forth in
this news release.


Material Risks

Important risk factors that could cause our assumptions and estimates to
be inaccurate and actual results or events to differ materially from
those expressed in or implied by our forward-looking statements,
including our 2013 financial guidance, are listed below. The
realization of our forward-looking statements, including our ability to
meet our 2013 financial guidance, essentially depends on our business
performance which, in turn, is subject to many risks. Accordingly,
readers are cautioned that any of the following risks could have a
material adverse effect on our forward-looking statements. These risks
include, but are not limited to:



-- the intensity of competitive activity, and the resulting impact
on our ability to retain existing customers and attract new
ones, as well as on our pricing strategies, ARPU and financial
results;
-- the level of technological substitution contributing to reduced
utilization of traditional wireline voice services and the
increasing number of households that use only wireless
telephone services;
-- the increased adoption by customers of alternative TV services;
-- variability in subscriber acquisition and retention costs based
on subscriber acquisitions, retention volumes, smartphone sales
and handset discount levels;
-- regulatory initiatives or proceedings, litigation, changes in
laws or regulations and tax matters;
-- our failure to maintain network operating performance including
as a result of the significant increase in broadband demand and
in the volume of wireless data driven traffic;
-- events affecting the functionality of, and our ability to
protect, maintain and replace, our networks, equipment,
facilities and other assets;
-- our ability to maintain customer service and keep our networks
operational in the event of the occurrence of environmental
disasters or epidemics, pandemics and other health risks;
-- our ability to anticipate and respond to technological change,
upgrade our networks and rapidly offer new products and
services;
-- our failure to implement, on a timely basis, or maintain
effective IT systems and the complexity and costs of our IT
environment;
-- general economic and financial market conditions, the level of
consumer confidence and spending, and the demand for, and
prices of, our products and services;
-- our ability to implement our strategies and plans in order to
produce the expected benefits, including our ability to
continue to implement our cost reduction initiatives and
contain capital intensity while seeking to improve customer
service;
-- increased contributions to post-employment benefit plans;
-- ineffective management of changes resulting from restructurings
and other corporate initiatives and from the integration of
business units and business acquisitions;
-- the complexity of our product offerings and pricing plans;
-- labour disruptions;
-- employee retention and performance;
-- events affecting the ability of third-party suppliers to
provide to us, and our ability to purchase, essential products
and services;
-- the quality of our network and customer equipment and the
extent to which they may be subject to manufacturing defects;
-- capital and other expenditure levels, financing and debt
requirements and our ability to raise the capital we need to
implement our business plan, including for BCE's dividend
payments and to fund capital and other expenditures and
generally meet our financial obligations;
-- our ability to discontinue certain traditional services as
necessary to improve capital and operating efficiencies;
-- launch and in-orbit risks of satellites used by Bell ExpressVu
Limited Partnership;
-- the theft of our DTH satellite television services;
-- Bell Media's significant dependence on continued demand for
advertising, and the potential adverse effect thereon from
economic conditions, cyclical and seasonal variations and
competitive pressures;
-- the adverse effect of new technology and increasing
fragmentation in Bell Media's television and radio markets;
-- health concerns about radio frequency emissions from wireless
devices;
-- BCE's dependence on the ability of its subsidiaries, joint
ventures and other companies in which it has an interest to pay
dividends and make other distributions;
-- there can be no certainty that dividends will be declared by
BCE's board of directors or that BCE's dividend policy will be
maintained;
-- stock market volatility;
-- our failure to evolve practices and effectively monitor and
control fraudulent activities; and
-- our failure to successfully integrate Astral into Bell Media
and to achieve the anticipated strategic and other benefits.




We caution that the foregoing list of risk factors is not exhaustive and
other factors could also adversely affect our results. We encourage
investors to also read BCE's 2012 Annual MD&A dated March 7, 2013
(included in the BCE 2012 Annual Report) as updated in BCE's 2013 First
and Second Quarter MD&As, dated May 8, 2013 and August 7, 2013
respectively, for additional information with respect to certain of
these and other assumptions and risks, filed by BCE with the Canadian
securities commissions (available at www.sedar.com) and with the U.S. Securities and Exchange Commission (available at www.sec.gov). These documents are also available on BCE's website at www.bce.ca.


ABOUT BCE

BCE is Canada's largest communications company, providing a
comprehensive and innovative suite of broadband communication services
to residential and business customers under the Bell and Bell Aliant
brands. Bell Media is Canada's premier multimedia company with leading
assets in television, radio and digital media, including CTV, Canada's
#1 television network, and the country's most-watched specialty
channels. To learn more, please visit BCE.ca.



The Bell Let's Talk mental health initiative is a national charitable
and awareness program promoting mental health across Canada with the
Bell Let's Talk Day anti-stigma campaign and significant Bell funding
of community care and access, research, and workplace initiatives. To
learn more, please visit Bell.ca/LetsTalk.



For BCE corporate information, please visit BCE.ca. For Bell product and service information, please visit Bell.ca. For Bell Media, please visit BellMedia.ca.


SOURCE Bell Canada

Bell Canada

CONTACT: Media inquiries:
Jean Charles Robillard
Bell Communications
(514) 870-4739
jean_charles.robillard@bell.caInvestor inquiries:
Thane Fotopoulos
BCE Investor Relations
(514) 870-4619
thane.fotopoulos@bell.ca


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