BCE cutting workforce by 9% in biggest restructuring effort in almost ...
BCE Inc. BCE-T is reducing its workforce by 9 per cent, or 4,800 positions, its largest restructuring initiative in nearly 30 years amid what it describes as a difficult economic and regulatory environment.
The Montreal-based telecom announced the job cuts on Thursday as it reported a 23-per-cent drop in its fourth-quarter profit, to $435-million.
The announcement marks the second round of restructuring at the telecom giant in eight months. In June of 2023, BCE announced that it was reducing its headcount by roughly 1,300 positions, primarily in management, as a result of declining legacy phone revenues and losses in its news and radio operations.
In an open letter to employees on Thursday, BCE’s president and CEO Mirko Bibic called the decision “incredibly tough” and said that wherever possible, the telecom would use vacancies and natural attrition to reduce its workforce.
“We continue to face a difficult economy and government and regulatory decisions that undermine investment in our networks, fail to support our media business in a time of crisis and fail to level the playing field with global tech giants,” Mr. Bibic wrote.
“Of particular concern is a recent decision by the CRTC forcing Bell to provide third party resellers access to our high-speed fibre network before we have even had an opportunity to recoup our multi-billion dollar investment.”
Mr. Bibic added that BCE expects to lose over $250-million in legacy phone revenues every year and that advertising revenues at its Bell Media subsidiary declined by $140-million in 2023 compared to the previous year.
“Across Bell Media’s news operations, we continue to incur over $40 million in annual operating losses despite having the most-watched network of local TV stations.”
In a separate letter to employees, Bell Media president Sean Cohan said the company plans to sell 45 of its 103 radio stations to seven buyers, subject to approval by the CRTC.
BCE’s fourth-quarter profit amounted to 42 cents per share, down from 58 cents per share during the fourth quarter of 2022.
The telecom giant had $6.47-billion of revenue during the three-month period ended Dec. 31, up 2 per cent from a year earlier when it reported $6.44-billion of revenue.
After adjusting for items such as costs stemming from severance and acquisitions, equity losses on joint venture investments and the impairment of assets, BCE had $691-million of profit, or 76 cents per share, up from from $654-million, or 71 cents per share, during the same quarter in 2022.
Analysts had been expecting adjusted earnings of 73 cents per share and revenue of $6.47-billion, according to the consensus estimate from S&P Capital IQ.
The telecom added 128,715 net new postpaid wireless customers during the quarter, down 16.8 per cent year-over-year from 154,617. (Postpaid subscribers are those who are billed at the end of the month for the services they used, versus prepaid customers, who pay upfront for wireless services.)
The company attributed the decrease to a more competitive marketplace, noting that churn – the rate of customer turnover on a monthly basis – among its postpaid wireless customers increased to 1.63 per cent during the quarter, compared to 1.22 a year earlier.
Its prepaid customer base declined by 36,630 net subscribers, compared to a loss of 31,996 in the fourth quarter of 2022.
