BCE Slashes Quarterly Dividend By 56% Despite Profit Rising

Canada’s BCE Inc. (BCE), the parent company of Bell Media, has cut its quarterly dividend payment to shareholders by 56% even as it reported that its first-quarter profit rose.

The Montral-based telecommunications company says it will now pay a quarterly dividend of 43.75 cents per share, down 56% from 99.75 cents a share previously.

BCE stock, until now, had a dividend yield of 13.58%, one of the highest payout ratios of any publicly traded Canadian company.

The high dividend yield made BCE stock a favorite among retirees and investors who are seeking income generation.

BCE Chief Executive Officer (CEO) Mirko Bibic said the dividend cut is necessary as the company faces intense price competition and ongoing geopolitical instability.

News of the dividend cut comes as BCE reported decent first-quarter financial results.

The media giant announced earnings per share of $0.68, up 55% from $0.44 a year earlier.

However, revenue in the year’s first quarter totalled $5.93 billion, down 1% from $6.01 billion generated a year ago.

Despite its previous hefty distribution to shareholders, BCE stock has struggled in recent years.

Over the past 12 months, the company’s share price has declined 36% to $29.38 in Toronto. Through five years, the stock is down 48%.