UPDATE 2-Canada's BCE posts lower profit, raises dividend

(Adds details on operating performance, outlook, stock price)
By Alastair Sharp
TORONTO, Feb 4 (Reuters) - BCE Inc BCE.TO , the Canadian
telecommunications and media company, reported a drop in
fourth-quarter profit as it paid more to win wireless business
and for workers' severance, but raised its dividend and pointed
to moderate growth in 2016.
Bell, as the company is known to customers, said on Thursday
that wireless revenue grew 5.9 percent as it added 91,000
postpaid wireless customers, who typically spend more than those
who prepay.
Wireless market leader Rogers Communications Inc RCIb.TO
said last week it added 31,000 such customers. Telus Corp
T.TO , the country's third national wireless player, is due to
report earnings on Feb. 11.
In the fourth quarter, Bell's wireless customers, on
average, spent C$63.67 a month, although it paid more to court
and retain them amid aggressive holiday promotions, versus
C$59.16 for Rogers.
The Montreal-based company also added 74,000 Fibe TV
customers and 39,000 high-speed Internet connections.
RBC Capital Markets analyst Drew McReynolds said the results
and 2016 forecasts, including 1 percent to 3 percent revenue
growth and adjusted earnings of C$3.45-C$3.55 a share, were
largely in line with rising market expectations.
Fixed-line revenue declined 1.5 percent, but margins
improved on cost-cutting. Its media unit reported a 3.4 percent
gain in revenue, but margins were squeezed by rising content
costs.
The company expanding its control of HBO content in Canada
in November.
Bell said the "significant cost restructuring" in its media
unit will bring labor savings that should offset further content
cost increases and the impact of new broadcast rules that will
bring more consumer choice.
Net income attributable to shareholders fell to C$496
million ($362.1 million), or 58 Canadian cents a share, from
C$542 million, or 64 cents, a year earlier.
Revenue rose 1.4 percent to C$5.60 billion, just below
analysts' expectations, while adjusted earnings were 72 Canadian
cents a share, unchanged from a year earlier. Analysts, on
average, expected 73 cents, according to Thomson Reuters
I/B/E/S.
Bell raised its dividend by 5 percent, in contrast to
Rogers, which surprised investors by holding its payout steady.
BCE shares were up 1.5 percent to C$57.59 while the broader
index rose 1.3 percent.
BCE Chairman Thomas O'Neill will retire in April. BCE plans
to nominate Gord Nixon, the former chief executive officer of
Royal Bank of Canada, to replace him, the company said.
($1 = 1.3699 Canadian dollars)