Bell Media Has Cut 1 In 4 Positions Since 2020 as Parent Company Keeps Dividend Rolling

When news first broke that BCE Inc (TSE: BCE) would be cutting 4,800 positions last month in their transition from a “telco” to a “techco,” those working at Bell Media must have been left reeling. After all, Bell Media had already gone through two major series of job cuts between 2021 – 2023, a period which had collectively eliminated just over 1,000 positions.

While BCE’s CEO Mirko Bibic made it clear that “fewer than 10% of cuts would be at Bell Media specifically,” the loss of what could be another 400+ jobs at Bell Media would represent the third major downsizing at the division in just 4 years.

Those jobs were eliminated over a zoom call, where employees were locked on mute. So much for #BellLetsTalk, am I right?

Bell Media is certainly not new to restructurings, but the pace and gravity of them have accelerated. The major restructuring in 2015 shrank the company’s employee base from 7,342 at the end of 2014 to 6,568 at the end of 2015 – a loss of 774 positions representing a 10.5% cut. The period between 2016 and 2020 that followed was not immune to job losses, however, in that period the employee base declined by 349 positions representing a 5.3% drop over 5 years.

After this period of relative, albeit declining, stability, by 2021 the decision to aggressively trim the division went into affect. In 2021, the company trimmed 544 positions amounting to an 8.75% drop on the previous year. This was followed by another cut of 427 positions in 2023, which represented a decline of 7.56% on the prior year. Now with this new announcement to cut further, Bell Media could see a drop of another 400+ positions which would approximate to an ~8% drop on the 2023 year-end employee base. All told, when these cuts are completed, Bell Media may have cut as much as 23% of the company’s 2020 employee base, dropping the total from 6,219 to just ~4,800 in a little over 3 years.

The notion that this latest round will certainly be the last round for some time should be considered wishful thinking at its worst. Even Bell has acknowledged that Bell Media faces considerable “secular and regulatory pressures” and that the sustained weakness in the advertising market has been challenging for them. (If you are one of those readers who has cut the cord or doesn’t watch television news, you are part of those “secular pressures.”)

Compounding the need to ruthlessly control costs, BCE’s substantial debt levels have raised concerns at rating agencies. Just last week, S&P Global revised their outlook on BCE Inc. from stable to negative citing, among other things, the company’s weakening debt-to-EBITDA ratio. BCE management has indicated that one of the ways they hope to get their leverage back onside would be through “noncore asset sales and other corporate initiatives.”

Ultimately, while Bell Media has already gone through substantive cuts and remains profitable (for now), it is unlikely given their challenges that BCE management won’t look to further cut and divest from the division.

They could cut their dividend which amounts to over $3.4 billion in annual cash outflows to get their debt situation under control. But cutting jobs and selling off non-core assets sounds a lot more profitable, which for a company who decided it was a great idea to monetize mental health on social media, is what I’d expect.

Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Leave a Reply