Thane Fotopoulos - IR George Cope - President and CEO Siim Vanaselja - EVP and CFO

Richard Choe - JPMorgan Simon Flannery - Morgan Stanley Phillip Huang - Barclays Capital Greg MacDonald - Macquarie Capital Maher Yaghi - Desjardins Capital Vince Valentini - TD Securities Glen Campbell - Bank of America/Merrill Lynch Drew McReynolds - RBC Tim Casey - BMO Capital Markets Jeff Fan - Scotiabank

Thank you, Wayne, and good morning to everybody on the call and web cast. With me here today as usual are George Cope, Bell's President and CEO; as well as Siim Vanaselja, our CFO.

As most of you know, this will be Siim's last analyst conference call before he retires later this quarter. We released our first quarter results earlier this morning.

All the usual information, including the news release and slide presentation for this call are available on the BCE web site; because of our annual internal meeting that is taking place this morning, we will be ending this call a little bit earlier than usual, at around 8:45. So we will take as many questions as time permits, after George and Siim are done with their formal remarks.

However, before we do begin, I'd like to draw your attention to the Safe Harbor statement on slide 2 of the deck. Information in this presentation and remarks made today by today's speakers will contain statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties.

Actual results may differ materially. These forward-looking statements represent our expectations as of today, and accordingly are subject to change, except as may be required by Canadian Securities Laws, we do not undertake any obligation to update or revise any forward-looking statement.

For additional information, you may consult BCE's 2004 Annual MD&A, as updated in BCE's 2015 Q1 MD&A and BCE's news release dated April 0, 2015 announcing our financial results for the first quarter of this year. All of these are filed with the Canadian Securities Commission and with the SEC and also available on our corporate web site.

So with that done, George, over to you.

Thanks Thane. Good morning everyone, thank you for joining us.

Let me just begin by saying, we had a very positive quarter, seeing the revenue growth of 2.8% year-over-year, driving EBITDA growth of 3.6% and importantly, an increase in our margin as well to 40%. We continue to have strong wireless results with -- from our perspective, an exceptional quarter, revenue growth 9.7%, but importantly for the third quarter in a row, 10% plus EBITDA growth.

Just as important as the third quarter of consecutive EBITDA growth on the wireline side. Strong subscriber numbers, particularly, we continue to see with the sale of the IPTV product, the pull-through of the internet, with combined net adds of IPTV and internet of 101,000 subscribers during the quarter.

Bell Media had a strong revenue growth quarter, relative to where we thought it may have been. But of course, we have seen the increasing content costs and with the launch of the great product, some impact on EBITDA, but clearly better than the fourth quarter as we had anticipated.

We turn to the wireless results, postpaid net adds, as you can see, up year-over-year and we are very pleased with the reduction in churn, to 1.18% in the quarter, and we had very strong service metrics in the quarter, and we think that is driving improvement in churn, and we'd expect to see an improvement of churn in the second quarter as well. Continue to see, with the increased usage by customers on the LTE network, an increase in the average monthly bill, up 5.3% year-over-year and driving some of the strong financial results, that Siim will talk about in a few minutes.

The retention expense was up year-over-year, 1.3 points, and of course that is in anticipation of the double cohort and trying to get ahead of that as quickly as we can. Turning to the wireline side, 40,000 internet net adds, and the 61,000 IPTV net adds on strategy, as we continue to grow the footprint and compete aggressively in the marketplace.

We are also, at the same time, seeing improvements in our ARPU across both those units, so clearly, we are taking customers with our product leadership, not price leadership in the marketplace. Our satellite losses continue to be impacted by the migration to IPTV and other migrations in other footprints as well.

And you can see there, up to 34,000 losses, 25,000 of them were actually in our ILEC footprint, and that of course includes, what is now the Bell and Bell Aliant product footprint. Continue to see the reduction in consumer line losses, 17.2% year-over-year and that continues to be helped by the pull through of IPTV and internet.

And importantly on the quarter, in our ILEC footprint, we were positive RGUs and for sure, that would be the first time we have done that in a first quarter of the year. Turning to Bell Media, again, Siim will take you through the financials, but we had positive revenue growth in Q1.

CTV had a very strong season 14 at the top 20 programs viewed by Canadians on CTV, eight of the top 10 with our prime-time audience is up 19%. Very proud the TSN in the first quarter of the year remained the number one sports property in the country, even with the loss of the national part of our hockey arrangements.

Continue to see growth in our specialty TV market in Quebec, and added to the Crave portfolio, the Showtime portfolio and continue to see an acceleration in subscriber growth of our Crave product, and hitting the numbers that we had expected internally. I thought I would highlight this quarter, just how strong our service levels were and the improvements we are seeing, and we are really seeing two benefits across the board, and that is as our service levels improve, our costs are actually being reduced.

To give you a couple of metrics here, our calls handled in just the first quarter alone were down $1.7 million year-over-year; on time check arrival at 98%. We introduced two-hour appointment windows for our Fibe TV services.

The Fibe TV churn was down, wireless postpaid churn was down and we continue to see improvements in our net promoter score. So across the board, we continue to see significant improvement in our service levels, seeing in the results on churn and seeing in results on our expenses.

So with that, let me turn it over to Siim, for his last presentation of our quarter, and on behalf of everyone at BCE, I want to thank Siim for his incredible career at BCE, and if you look at the enterprise [indiscernible] you will know it has more than doubled and added $30 billion of value, and obviously under Siim's leadership as CFO, he has been significantly responsible for that. So let me turn it over to Siim.

Thank you, George, for that. Good morning everyone.

I will start with some comments on the key highlights of our first quarter results, starting on slide 10. We had a very good start to the year with all our operating segments, wireless, wireline and media contributing to the consolidated revenue growth of 2.8% in the quarter and if we look at Bell's growth services in isolation, revenue in fact increased in aggregate by approximately 5% year-over-year.

Our adjusted EBITDA grew 3.6%, yielding a higher margin of 40% as George highlighted. Bell Wireless contributed another excellent financial quarter, Bell Wireline posted its third consecutive quarter of positive year-over-year growth and EBITDA, and we also saw sequential improvement in Bell Media's EBITDA, after incurring higher content costs.

I'd also highlight that our revenue and adjusted EBITDA growth in the quarter is all organic growth, and that our 2014 operating results have been restated, to reflect Bell Aliant within our respective wireline and wireless segments. Adjusted EPS in the quarter grew 3.7% over last year to $0.84, and lastly, free cash flow was $231 million for the quarter, and that reflects the faster pace of capital spending on broadband networks and infrastructure.

So overall, I'd say it was a strong financial quarter, with performance across all segments, and all very consistent with the guidance that we provided to you back in February. Let me now turn to the results of each of our operating segments.

In Wireless, on slide 11, revenue growth accelerated to 9.7% this quarter, that was on stronger data revenue growth of 24.4%. ARPU growth in wireless to 5.3% reflected and expanded, postpaid customer base with 52% of our postpaid subscribers now on LTE.

And from a profitability perspective, wireless EBITDA posted double digit growth of 10.7%. That yielded a revenue flow-through to EBITDA of 62%, and a 1.2 percentage point increase in our service margin to 47.5%, and all that was achieved while absorbing $31 million in incremental retention costs in the quarter.

Wireless EBITDA less CapEx provided a healthy contribution to free cash flow with growth of a little over 7% year-over-year. Overall, I'd say another in, what has now been a long line of excellent quarters for Bell Wireless.

Turning to the wireline segment, on slide 12, the first quarter represented our second consecutive quarter of positive growth in total wireline revenue, and that was led by another quarter of positive results in our residential service unit, which delivered revenue growth of 1.8%. TV and Internet combined generated 6% higher year-over-year revenue, as we continued growing both scale and ARPU in those businesses.

And voice erosion also continued to slow, reflecting fewer residential mass line losses compared to last year. In business wireline, service revenue and EBITDA declines improved year-over-year, and that was supported by cost management actions, and we saw stronger business, IP connectivity and solutions growth.

Our business markets performance overall, however, continues to reflect the repricing pressures and a slow pace of new business investment. Wireline adjusted EBITDA increased 1%, which was our third consecutive quarter of consecutive growth, and our wireline margin improved 30 basis points year-over-year to 41%, again supported by cost synergies, principally from the Bell Aliant integration and improvement in our service metrics.

Lastly, with quite lean cost structure in growing internet and TV scale, we are generating substantial wireline cash flow, with an EBITDA less CapEx margin of about 20%, and that gives us good room to fund continued investment in our broadband fiber programs going forward. On to slide 13, Bell Media revenues were up slightly in the quarter, increasing 0.6%, advertising revenues grew 2.5%, which was driven by conventional TV, where we continue to lead in live event programming.

I'd highlight that in the quarter specialty, sports specialty TV advertising revenues were in fact stable year-over-year. Subscriber revenues declined 4.4%, reflecting the closing of TSM regional hockey channel, both for the Winnipeg Jets and Montreal Canadiens as we move that coverage from separate pay channels to be included in our TSA [ph] and multiplex package.

This, together with the shutdown of viewers choice, which you may recall happened last September, will impact subscriber revenue growth through to the fourth quarter of this year. Adjusted EBITDA for media decreased 6%, that was in line with our expectations and guidance assumptions, and as George said, reflecting higher cost for sports broadcast rights, and the investment that we are making in Crave TV programming.

Excluding Crave TV startup losses in the quarter, Bell Media's adjusted EBITDA declined by approximately 3% year-over-year. Slide 14 summarizes our adjusted EPS for the quarter, which was $0.84 per share or 3.7% higher year-over-year.

Adjusted EBITDA growth contributed $0.07 per share to EPS in the quarter. Amortization expense was lower compared to last year, which was due to an increase in the use-for-life of application software and favorable tax adjustments were $0.03 per share compared to $0.01 in the first quarter of 2013, that resulted in an effective tax rate of a little over 23% this quarter, and I'd say that at this time, we are not anticipating any further tax settlements through the remainder of 2015.

You will see that net interest expense was also lower this quarter, reflecting the combined impact of higher capitalized interest attributable to spectrum, that has not yet been put into service, and a lower average cost of debt. So as a result, we now expect interest expense of approximately $940 million for the full year 2015, which is down from our previous expectation of approximately $970 million.

Non-controlling interest or NCI was lower this quarter, due to BCE now owning 100% of Aliant. This however was offset by the dilutive impact from the issuance of BCE common shares on the Bell-Aliant privatization.

And lastly on EPS, I draw your attention, that the year-over-year increase in EPS this quarter was moderated by the earnings that we received in the first quarter last year from our ownership of the Astral [indiscernible] that's prior to their divestiture, as well as by higher mark-to-market gains recognized on both our equity derivative contracts and our U.S. dollar CapEx hedges.

Collectively, those items announced into about $0.08 of EPS on a year-over-year basis. Turning to slide 15, we generated free cash flow of $231 million in the first quarter, with adjusted EBITDA less CapEx growth of 14.4%.

As you will know, operating free cash flow in the first quarter tends to be seasonally low, and additionally, the distributions received last year from the [indiscernible] assets prior to their sale, contributed to higher working capital in the first quarter of 2014. The year-over-year increase in cash taxes is consistent with our guidance, and reflects the higher final tax payment made in respect of the 2014 tax year.

Cash interest payments were also higher this quarter, reflecting a higher level of outstanding long term debt, which arose due to the Bell-Aliant privatization. And on the pension front, as part of our continued derisking efforts, we entered into an insurance swap contract, that transferred the longevity risk for approximately $5 billion of our pension plan liability to Sun Life.

We will benefit financially from that longevity swap, as life expectancy projections increase by about 1.5 years over the remaining duration of our closed plan. And I think if you look at Canadian longevity historic trends and recent studies, these would show a much more significant increase than that, so we think we are getting good value for that swap contract.

We ended the quarter with over $1.1 billion of cash on the balance sheet, and in March we issued a $500 million 30-year debenture with after-tax coupon of approximately 3.2%. Having done, we brought our overall leverage and after-tax cost of BCE debt to 3.4%.

And lastly, our investment grade credit ratings were recently reaffirmed by the rating agencies, and all with stable outlooks. So to wrap up, the first quarter's performance provided a strong start to the year, all consistent with our financial guidance targets for the year, and with no changes to our outlook, I am affirming all of our 2015 guidance targets.

Wireless should continue to deliver a strong contribution through the remaining quarters of 2015, and wireline should continue to deliver positive EBITDA growth. Bell Media's performance, as we have seen for the past few quarters, will continue to reflect the higher costs of sports broadcast rights and programming investment in Crave TV.

So before beginning the Q&A period and with my retirement this quarter, I did want to acknowledge what a privilege it has been to be the CFO of this great company for the past 15 years, and to have been a part of George Cope's management team. And it has also been very much a pleasure working with all of you, the analysts and the financial community.

So on that, let me turn the call back to Thane and the operator.

Thanks Siim. And I also wanted to take the opportunity to say, what a pleasure it has been to work with you for the past 10 years as well.

Before we start the Q&A period, I want to remind participants of our time constraints this morning, so please respect that by keeping your questions brief and focused, so we can get to as many of you in the queue as possible. So with that Wayne, we are ready to take our first question.

Great. Thank you.

Just wanted to ask about the wireless side, is it lower churn and solid margins despite the double cohort kind of starting to impact you one way in retention? How should we think about this going forward, and how are you managing through it?

And then I think you also mentioned that churn might be lower in the second quarter, despite all this, wondering or why you're confident of that? Thank you.

Thanks for the question. I did mention, that's why we are careful on forecast.

I think there is a number of things happening, one as I mentioned, and that's why I highlighted our service metrics. Now the improvement in the investment we made, which will be close to $700 million across the company in the last five years, is truly starting to pay out benefits for their customer relationships, and we are seeing the interaction with our customer has improved dramatically, and we think, as a result of that, that's why we are seeing a reduction in churn, and we are also seeing a reduction in our costs.

And so our actual overall cost to operate in the company have reduced, as a result of this improvement in service, and we expect to continue to see that, as we go forward. We clearly also, with the migration of customers to LTE handsets, are seeing them use the product more, and I mentioned that a few quarters in a row that, and that is driving increased ARPU, and of course, that's giving us, if you will, the headroom to accelerate our retention expense yet, hold the margins at a healthy growth level.

So we will have to see how the year plays out, but we certainly are really pleased with the first quarter, as the metrics are moving in the right direction, and yet out market share is moving in the right direction as well.

Thank you.

Next question please.

Great. Thanks very much, and Siim congratulations and good luck to you.

Following up on your comments on ARPU there, George, can you sort of disaggregate the 5% increase. People going from feature phones to smartphones, people going from 3G to LTE, LTE users using more data going up to bigger buckets.

What's the kind of breakout of the major factors there?

I think the number one factor is the migration from HSP to LTE. We see it -- its always a little bit slanted, because of course, early adopters, maybe those that have used the product the most.

But there is no doubt, and I don't have it at my fingertips, but Thane would be happy to share with you, after the usage that we are seeing from an HSPA conversion to LTE.

They are buying a bigger bucket of data when they --

They are buying a bigger bucket of data, or using more data themselves in the same bucket, and of course that obviously drives additional ARPU as well. Those are really the two major driving factors, and then of course the other is, the migration to the two year versus three year contract.

We have been very disciplined on our pricing side, in the company, to make sure we can absorb that additional retention spend that's required on a 24 month cycle versus a 36, and part of that has been pass-through in making sure we are disciplinally holding our prices. And clearly, its working, because we are also seeing a reduction in churn.

So we are hitting the satisfaction level for our customer base, and yet at the same time, being able to maintain the right discipline to be able to afford, if you will, this two year business cycle we are moving to versus three. But I would say, investors should assume the vast majority of this migration to LTE and that the video quality people are seeing, and that's driving usage.

And the LTE, presumably, that's 90% plus of your phone sales these days, is it?

Yeah. Of our net adds, its probably -- actually yes, it would be actually be more than that on net, if you can imagine because of the conversions.

Yep. Thank you.

Thanks. Good morning, and first, congrats to Siim on your retirement, you will surely be missed.

My question is on the cyber side, very encouraging to see the accelerating broadband subscriber growth again this quarter. I was wondering if you can give us an update for your fiber footprint expansion and the percentage of your footprint that is now capable of speeds, over say 25 to 30 megabits per second?

And also, to what extent are your IPTV and Crave TV still driving some of this momentum? Thanks.

Yeah. So 95% of our IPTV footprint would be higher than 40.

On top of that, we have, I think approximately 2 million plus of our -- homes of course are fiber directly right to the premises, and we will continue to do two things, one, grow the IPTV footprint and the fiber footprint, and also continue to overlay, where we have fiber-to-the-node over -- year-over-year, you are going to see us continue to migrate those clients and businesses to fiber right to the premises as well. And so it will be a multiyear program, we will keep our capital intensity that The Street has come to become from with, and we have talked about is.

And one of the reasons we outlined in the press release, the $20 billion commitment through to the end of 2020 to make sure, its very clear to the investment community that our capital intensity will stay in the range we are at. But that we will continue to make these type of capital investments on the broadband side, both in wireless and wireline.

And we are seeing, its very clear that where we have -- particularly where we have IPTV, the RGUs even, obviously much more positive, given where positive RGUs now, and that includes the footprint where we have DSL, and we are clearly negative RGU in that footprint, and we know we have got to expand at a reasonable pace there.

That's very helpful. Just a quick follow-up on the wireless side, some of the questions, with the growing adoption of LTE and increasing data usage, I was wondering if you could give us an update on your deployment funds for your portfolio spectrum, just to keep up with the bandwidth, etcetera?

Thank you.

Well we have done a number of markets already with 700. We can come back -- there is no secret, we will come back and clarify exactly how much of the population will have our 700 access by the end of the year.

At the end of the year in Canada, 98% of the population will have access to LTE, and so we are in the midst of rolling out 700 now, and we can come back on the different band speeds, and on a side column to show that [indiscernible]. But clearly, it will be 98% at the end of the year with LTE coverage.

Thanks George.

Thank you and good morning. Question on the media side, and by the way, I will say, congrats to Siim, it has been a pleasure working with you over the years.

On the media side, decent result there on the revenue, positive revenue George, as you indicated. Despite the fact that we are actually seeing some alternative views from some of the other guys reflecting macro headwinds, particularly out of Shaw, somewhat out of Rogers; wondered if you could talk a little bit about, A, the pricing that you're seeing forward, advertising trends that you're seeing, and then B, slightly different message on the EBITDA line relative to consensus, where it was down 6%.

Just remind us, was there something particular in the quarter on a cost side, or was that resulting in -- a result of overall higher cost per content? Thanks.

Well I think our EBITDA was in line with what we certainly expected. As Siim had said, that EBITDA decline would have been half what it was, if we weren't making the investment in Crave TV.

So you know, that would have been 3%, and then as we said on the last call, we thought, Q4 would be the kind of the peak value of the EBITDA, and we are seeing that. On the revenue side, what really is, when our primetime audiences are up 19% year-over-year, that is driving for our media folks, obviously the ability to monetize in the advertising market.

I am not saying, it’s the most robust advertising market, but clearly, we are pleased with the quarter, and we also did not have to compete in the quarter with last year's Olympics, which of course helps us as well. So we are not going to get into pricing in the marketplace, because its obviously a highly competitive market.

But there is no doubt, it can provide the content Canadians want. You can attract viewers, and then that obviously allows us to monetize it.

Really, the true pressures on the cost side are Crave TV, and we absolutely know it’s the right thing strategically to do going forward, particularly having the HBO content and the ShowTime content. There is no content like it for an [indiscernible] library in the world.

And so having that capability, and secondly, having to respond to the competitive pricing put in the market for sports content, to maintain the sports assets we have, we of course matched some of those prices to maintain the games, for instance in Montreal. As everyone knows, we exercised our match right to what had been paid, and of course, that significantly increased our price for the 60 Montreal Canadien games, but it was do that or not have the games, and of course, long term strategically, we felt it important in Quebec to maintain those 60 hockey games.

Those are really the two drivers.

Thanks George. And any comment you can make on future advertising trends, particularly given the economy?

Any change in the way advertisers are coming to you and requests that they are making on the pricing side?

Well the only thing I would say, that we are seeing that is helpful in our portfolio, is strategically making sure we can bring to Canadian companies, the ability to bring our radio platform of 100 plus radio stations. This outdoor platform that we are fortunate to buy from Astral and our TV platform, allows us to offer, particularly Chief Brand Officers, all three of these as one sort of packaging proposal, and we think that's making a difference for us in the marketplace.

All right. That's helpful.

Thanks.

Yes. Thank you for taking my question.

I'd like to add my name to congratulate Siim and hopefully a long and healthy retirement. I wanted to just talk a little bit the satellite market here, and can you maybe give us a split up on your satellite TV subscribers, versus what percentage of them are in your ILEC footprint and what percentage is in your non-ILEC footprint?

And what is the strategy that you guys have right now, on the non-ILEC footprint? What is your long term expectation, as to what kind of penetration we might end up having a few years down the road, on satellite?

Thank you. What we did for the first time, because we thought it was important to redefine for investors now with our ILEC footprint is, and so we have done that.

So where you can see -- maybe what I will share today, is of the 34,000 satellite losses, 25,000 of them are in the footprint and 9,000 will know we are outside of our footprint, and I will leave Thane later on to come back, and we can have a discussion on whether or not we are going to go to the next level, and you know what that split is going to do that top, ahead of this morning. But I will say this, in our 25,000 losses in our footprint, you can count on the fact that, roughly 15% of our net adds or IPTV, are coming from our own satellite footprint, and then the remaining there are for our competitive dynamics, where the cable companies would be competing with us, etcetera.

And then outside of our footprint of course, we have Telus as our wholesaler and their footprint, which gives them a complete ubiquitous TV footprint to complement with our IPTV, and we sell the product ourselves in all of Western Canada. So our strategy there, as it has been for throughout the period we had, the satellites, to continue to compete in that market.

But it is fair to say, we anticipate, in the core markets, the urban markets that have satellite, will continue to see a migration to IPTV. But when we tell you where our IPTV conversions at our own base.

The churn rate on our satellite is actually quite low, in terms of percentage. So the strategy is -- and the last thing is, we consolidate and run satellite and IPTV as one business unit, its like running HSPA and LTE as one business unit in wireless.

So all of our content purchasing, all of our product portfolios are all integrated under the same management team.

Maher, we can come back to you with the split on satellite TV between our ILEC and non-ILEC region.

Great. And just in terms of your deployment of fiber, at this point in time, can you tell us what percentage of your ILEC footprint is covered with IPTV?

And what is your expectation of that number to be at the end of 2015?

So we are at 6 million now, of a total footprint of a little over -- of a footprint of approximately 10 million. We will continue to expand the footprint, but we have decided strategically, we are not going to put the number out, because all we are doing, is signaling to our competitor where the next market is we are turning up.

But rest assured, we are going to continue to expand the footprint, and we are going to continue to overlay footprint, and expand. There is no new footprint that we build that isn't fiber, and we are expanding.

I mean, you will see the markets of Peterborough, Kingston are getting fiber into the marketplace, and we are just continuing on that path, and we will, quite frankly, in perpetuity, continue on that path.

Thank you, George.

Yeah. Thanks very much.

Before my question, can I just clarify what you said there George, Kingston-Peterborough, you mean fiber-to-the-home or you mean just the normal fiber-to-the-node?

Fiber-to-the-home. We don't do any neighborhoods now that are not fiber-to-the-home.

If its for what we are building, its fiber directly to the home.

Interesting. Thanks.

My real question was just on Bell-Aliant, can you just give us an update on the synergies you're seeing there, as you're being -- going through the integration process, and how much would have been achieved in the run rate in the first quarter?

Yeah, I am not going to give run rate, what we did do is, we anticipated $100 million of synergies this year between capital and OpEx. We will clearly achieve those, as we had wanted to see, and of course, we saw the wireline positive EBITDA, we are able to obtain that partially, because of the Aliant synergies, and obviously able to absorb the higher gross add costs, because when you see the net adds on internet and IPTV, you would -- and everyone would know, that means the gross adds were significantly higher.

So we are absorbing this accelerated growth costs through the synergies of putting the two companies together, and we will hit the $100 million for the year, but [indiscernible], that was a blend of both capital and OpEx, and the OpEx benefits we are seeing, that we expected. And great market leadership by that group as well, within their five footprints.

Thank you. Next question.

Yes, thanks very much. So for Siim, a couple of quick ones.

Nice to go out on such a strong set of numbers. On the wireline subscriber side, you highlighted the adjustments due to the CRTC, I noticed cancellation change.

But there is another set of adjustments on the balance related to older subs, I wonder if you could give us a little bit of detail there? And then my follow-up was, on the restructuring expense, I think the number was $224 million, could you give us a sense of what was there and whether the benefits from that are partly or entirely in the quarter?

Thanks.

Sure. First on the subscriber adjustments, in addition to the 30-day deactivations, there was a further 35,870 adjustments that we made to our opening base.

Those were, as a result of then audit review that we conduct on a periodic basis, just reconciling customer accounts, this was quite a comprehensive audit that we undertook, and as a result of that -- and you will see this in our supplements of recording as well as our MD&A. Of the 35,870, there was 31,426 adjustments in subscribers to the internet base.

3,790 total TV adjustments, and then 657 NAS. On the restructuring costs of $224 million, I believe the principal component of that was a legal action that we made a litigation provision for -- in the amount of -- Thane, I think its $137 million?

And that was a result of satellite piracy signal lawsuit that was launched against us. The action began in 2010.

2005, it was heard in the lower court of Quebec. In 2012, that decision essentially held in BCE's favor, and then in the quarter, we had a Quebec superior court that overturned that decision.

You should know that BCE is in the process of appealing that decision to the Supreme Court of Canada, and we should know within the next quarter, whether we will be successful in getting these to appeal.

Okay. Thanks.

So that's 137 out of the 224, was there anything noteworthy in the balance?

Yes, the other component of it, about $45 million related principally to privatization costs and severance costs relating to Bell-Aliant, and then there was associated real estate costs of about $8 million and I think about $4 million of acquisition costs that related to the Glentel acquisition.

Okay, great. Thanks and very best wishes.

Thank you.

Thanks very much and certainly would echo everyone, Siim, congratulations and all the best. George, just in terms of big picture question here; the shift from fiber-to-the-node to fiber-to-the-home, in terms of the timing and obviously last quarter, you highlighted that it will all be fiber-to-the-home, just wondering if you can comment on just why the switch -- is it a function of data demand, are you looking at a lower cost to deploy, are you comfortable with your fiber-to-the-node footprint, is it a competitive response?

Just wondering if you could kind of shed some light there, and just as a follow-up, can you just update on what your fiber-to-the-home experience has been in Quebec City? Thank you.

The decision to continue the evolution from the fiber and on new neighborhoods with fibers, is based on where we clearly see the industry going, the results we are seeing. Not just on the fiber-to-the-node, but where we have fiber.

And we don't have a significant fiber footprint with Bell-Aliant, and with Bell, 2 million homes, we can clearly see the operating benefits, in terms of truck rolls, because of fiber right to the home, so that's the cost savings. The churn numbers are better than the churn numbers on IPTV, when its fiber-to-the-node, so we see a difference there.

And then of course, our deployment skillsets are quite different, now that our teams have done 2 million homes and businesses, and also, doing a lot of work on trying to move as much of it to aerial, versus [indiscernible]. What I mean by that, going just beyond, not just leveraging our assets of telephone poles, where we can use hydro access points, we will as well, and of course that drives the cost down significantly.

So we will migrate, and we will build new and it will be a long term project. We are clearly competing very well with fiber-to-the-node.

But I think we see where the market is going to move to, and we see the financial payback for our shareholders as significant, as we are able to hold that fiber. So that's really what's behind it all, and then in terms of the geographies, I had mentioned a couple that are coming on.

We won't really, again, project exactly where, because we simply can't be just setting up our competitors to know where we are going to go next.

Thanks George. And just in Quebec City, just an update on your experience there?

Yeah Quebec City has been, for us -- our market shares were very weak. There is no doubt in the province of Quebec, in total, and in that market, because its fiber, we see the benefits across the board of the investment.

In fact, its interesting, it just balances almost between quarter-to-quarter, between our different geographies in terms of the momentum. But as I said, its not just Quebec City we look to for the metrics, we have so many markets now turned on because of the bell-Aliant markets, which are even more mature than some of the Quebec City markets.

And its undeniable, we should just continue this investment and migration for our shareholders.

Thank you.

Thanks George. Could you talk a little bit about your subscriber gains on the wireless side?

In terms of regions, you talked previously about a strategic thrust to gain more share at West. Is that accounting for some of these consistent gains, and is it more obvious that you're getting subscribers from Rogers, given their persistent losses on the postpaid side?

Thanks.

I would say there is no real material difference this quarter than the trends that we have seen. If anything, well let's face, where we have the strongest historical market share has been on the East Coast, so if we see any type of incumbent growth against us, our instincts would tell some of it probably comes there, from our western competitor, and then of course our continual focus on the west for the last six years, we just do a little better there, just proportionate, because our base is smaller, clearly.

But it really is for us, its across the board, it’s the churn improvement and the gross adds really driving both these market share growth that we are seeing. Well its not standing on only just one geography I guess, the clear answer.

Wayne, in the interest of time, this will be our last question.

Good morning. Thanks for squeezing me in.

Just a question regarding the CapEx outlook to 2020. Its great that we are getting this kind of visibility.

Just directionally George, are we expecting that wireline is going to pickup, if we are looking at segments, and wireless coming down? I am wondering if you can help us out in thinking through where the allocation is going to be across segments?

And also, as you look further out, what is the assumption regarding household internet usage, because every stat that we are seeing, that's going up at a very high rate, and we don't think that's going to stop, just given the trend over the top video. So maybe you can talk about, just general assumptions around that as well?

Thanks.

Yeah. So in terms of the capital, we have and every analyst has his own model, so I will be a little careful in long term guidance.

But if you look at our capital intensity number, and the analyst will be able to take that outlook on the capital and say, okay, that's a fairly consistent, see to eye [ph] that we have been running at it. Its just really affirming to investors, and importantly, also to the country, that we are going to continue at that rate of broadband investment.

In terms of the mix, it has been wireless, 10% to 12% if you look at our side, we don't see that dramatically changing. And then if you look at media, 3% to 5%, and I would then use X equals, not greater than a certain capital intensity going to wireline.

Its really the way we run the business. So the pace of fiber will really be driven by that in capital intensity number we are prepared to spend, and the pace we want to spend.

And clearly, you have seen in our results recently, more of it to the wireline side, and I think that's what Siim highlighted today, having wireline EBITDA margins through our cost management now at 40%, provides us we think the headroom from a capital perspective, relative to most other wireline ILECs in North America, to make this investment; and I think its really quite unique now, rather to what we are seeing in the U.S., where the market share of telco in Canada is now competing head-to-head with cable and internet, and that's a very different outcome in Canada that we are seeing in other countries.

And Jeff, just for the sake of clarity, the $20 billion, 2015 to 2020 is over six years.

Yes. And I apologize, on the usage, we will have to come back to you again.

We have these huge books and files and everything, and I don't think I have that at my fingertips. Its not proprietary, I think we are happy to share that.

Okay, thanks. And all the best Siim.

Thank you.

Thanks for the questions.

Very good. So once again thank you for your participation this morning on the call.

I will be available later today after our AGM for any follow-up questions or clarifications on that. Thanks and have a great day.

Thanks everyone. Thank you.

That concludes today's conference call. Please disconnect your lines at this time, and we thank you for your participation.