BCE Inc. and Telus Corp. will wrap up the second-quarter earnings season for Canadian telecom companies with their reports this week, both due Thursday morning.
Montreal-based Quebecor Inc. reported last Thursday and faced a barrage of questions from industry analysts on its possible wireless expansion outside of Quebec.
That prospect, more than any other issue, has dominated discussions this summer with respect to the stock performance of Canada's Big Three cellular carriers, BCE, Telus and Rogers Communications Inc. (BCE owns 15 per cent of The Globe and Mail.)
The upshot from Quebecor's comments on a conference call last week: It's still too soon to tell. Management said they are weighing every possibility and emphasized that clarity on regulatory issues – primarily rates for wholesale roaming costs – remains a key factor for the company.
On issues unrelated to the threat of a new national wireless competitor, Bell Aliant Inc. reported its second-quarter results Friday. Since BCE announced less than two weeks ago that it was moving to take its affiliate private – the deal is expected to close in November – analysts saw the report as particularly relevant to BCE shareholders.
The Atlantic Canada telecom operator reported better-than-expected subscriber numbers and is expected to generate solid free cash flow for BCE next year after it completes a capital-intensive fibre expansion program, although long-term growth remains a question mark.
When BCE and Telus themselves report, analysts will be looking for the two to continue grabbing more of the wireless market share than Rogers.
Canada's biggest mobile provider has been steadily ceding ground to its rivals in recent quarters. And as it works to turn around problems with customer service, Rogers is less focused on high-volume subscriber additions, which could prove to benefit BCE and Telus.
The fight for television subscriber share will also be in focus as BCE and Telus share the latest numbers on how their Internet protocol television (IPTV) offerings are faring against their cable competitors (primarily Shaw Communications Inc. in Telus's territory in the West and Rogers and Cogeco Cable Inc. in BCE's Eastern Canadian footprint).
On average, analysts surveyed by Bloomberg expect BCE to report $5.202-billion in revenue for the quarter and adjusted earnings per share of $0.84.
Telus is expected to report sales of $2.953-billion and adjusted EPS of $0.58.