BCE Inc. (BCE) Earnings Call Transcript & Summary

[Foreign Language] My name is Gordon Nixon, and I'm pleased to preside over this meeting as Chair of the Board of Directors of BCE. I will now call the meeting to order. To begin, I wish to acknowledge that we are joining you today from Montreal, located on the land which has long served as a site of meetings and exchange amongst indigenous people, including the Haudenosaunee and the Anishinaabe Nations. Bell recognizes and respects the commitment of indigenous people who have lived and worked on this land and is dedicated to fostering positive and mutually respectful relationships with indigenous peoples and communities. [Foreign Language], and thank you. Today is the fifth consecutive year that we have conducted our Annual General Meeting virtually. We initially adopted this format due to the unfortunate realities of COVID-19. However, to align with our core communications business, our ESG standards and our journey from a traditional telco to a techco services and digital media leader, and to enable more people to attend and enjoy an equally opportunity to participate in our meeting, we are again holding this meeting virtually. Please view this as we do as one more example of how the strength of communications technology and our networks can minimize environmental impacts while enabling even a broader and more diverse participation of our shareholders regardless of where they are located. We have made every effort to afford shareholders the same rights that they would have at a physical meeting. We will shortly go over the procedures of the meeting and how shareholders can vote and ask questions during the meeting. The business of this meeting will be conducted in both English and French. Online, you may choose the language of the meeting by selecting English, French or original feed at the top of your broadcast screen. If you select original feed, you will hear the original language spoken without any translation. Closed captioning is also available on all feeds. It can be turned on at the top right of the broadcast screen. And if you are listening by telephone and you wish to change the language, you must hang up and dial back into the meeting using the phone number that corresponds with the language of your choice and that is indicated on our website. I will now introduce the members of the BCE team joining me here today. On my left is Mirko Bibic, our President and Chief Executive Officer; and on my right is, Martin Cossette, our Senior Vice President of Corporate Strategy and our Corporate Secretary. In accordance with the BCE bylaws, I, as Chair of the Board, will act as Chair of this meeting and Martin will act as Secretary. Also attending today's meeting via phone are Jacqueline Mercer and Paul Fletcher, who are representatives of Deloitte, the shareholders' auditors. Curtis Millen, our Chief Financial Officer, is also with us today to answer questions and members of the Board of Directors and senior management of BC are also on the webcast. Before I begin, I would ask Martin to take us through the procedures of today's meeting. Martin?

[Foreign Language] Thank you, Mr. Chair. Voting during today's meeting will be through the Lumi platform only. As described in the proxy circular, only registered shareholders and duly appointed proxy holders who received a control number from our transfer agent, TSX Trust company may vote online during the meeting. Please note that you do not need to vote during the meeting if you have already voted by proxy. Starting now, you can register your vote on all items of business for today's meeting. To vote, click on the voting tab at the top of your screen. You will see the meeting resolutions displayed on your screen. To vote, select one of the voting options available. Your vote will automatically be submitted to our transfer agent after you make your selection. A vote may be changed up to the time voting is closed. The poll will remain open until the chair declares voting on all matters closed right after the motion approved on the advisory resolution on executive compensation. Preliminary results will be announced later this morning, and final results will be posted on our website. Shareholders were encouraged to ask questions ahead of the meeting through our website by contacting our Corporate Secretary's office, by contacting our Investor Relations group or through our transfer agent. We wish to thank shareholders who submitted questions ahead of the meeting. For those who wish to have their questions answered during the meeting, we'll be doing so at the appropriate time. Now you can submit the question at any time during the meetings, English or in French until the Chair closes the question period at the end of the meeting. It is recommended that questions be submitted as soon as possible during the meeting so that they can be answered at the appropriate time. To ask a question in writing online, click on the messaging tab at the top of your screen and submit your question. Enter your full name, whether you are a shareholder or proxy holder and your question in Ask a Question box, then press the send arrow to submit your question. Your question will be read at the appropriate time. Assuming they have been submitted in sufficient time, questions related to the matters of business to be voted on will be addressed at the time of such matter is discussed. Other questions will be addressed during question period after the business of the meeting has been completed. To ask a question by telephone, call the number appearing on the proxy circular on the meeting page of BCE.ca and on the homepage of Lumi platform and press on Star 1. A Lumi representative will dial you into the meeting at the appropriate time for you to ask your question live. For the good conduct of the meeting, questions should be in the interest of all shareholders and not personal in nature. If your question is related to a personal matter, a BCE representative will communicate with you after the meeting, if you have provided your contact information. To allow us to respond as many questions as possible, we will limit each person to 1 question and ask it in a succinct and in an event no longer than 2 minutes. If you have an additional question that hasn't already been asked, please feel free to submit it. And if we have time, we will address it. We just want to make sure we can be responsive to as many questions during the time allotted for the meeting. Written questions on the same topic or otherwise related may be grouped and addressed at the same time. I would now like to bring your attention on the notice appearing on screen. Today's remarks will contain forward-looking statements. They are based on several assumptions and are subject to important risks. The notice on screen contains a cautionary statement and in regard is made on behalf of our speaker whose remarks today will contain forward-looking statements. Finally, I can report that Bertrand Gely and Isabelle Vachon, employees of TSX Trust Company have been appointed to act as scrutineers at this meeting. Mr. Chair, I turn now the meeting over to you.

Merci, Martin. And once again, thank you all for joining us today. It is great to be here with you at our 2024 Annual Shareholders Meeting live in Montreal. As Canada's largest communications and media company, Bell is dedicated to creating value for our customers, our shareholders, our team members and our communities in which we work. Our purpose is to advance how Canadians connect with each other and with the world. To deliver on that purpose, we are transforming from a traditional telco to a company focused on communications, tech services and digital media, offering better products, better services and better experiences for our customers. Over the past year, we're exploring new areas of growth and crafting a road map for resilience in a rapidly changing environment. As we look back, we can be proud of the results that Bell has accomplished during what was a very challenging year for our industry. First, on community impact, Bell recognizes that our influence extends beyond our core business. We have an important role to play in building a brighter future. Corporate responsibility is a fundamental element of the strategic imperatives that guide BCE's policies and our actions. We are reducing our environmental footprint through our emissions reduction and environmental protection efforts. Earlier this year, Corporate Knights named Bell the most sustainable communications company in the world in the Global 100 rankings. Our longstanding dedication to mental health awareness and better access to care is also delivering results. Bell Let's Talk has become the world's largest conversation about mental health, and we expect to reach our funding commitment of $155 million by the end of 2025. Last year, as an example, we committed $15 million to the Kids Help Phone Feel Out Loud Campaign to expand access to [ mail ] online mental health services. And we also gave $1 million to IWK Health in Halifax to build a dedicated mental health space in the children's hospitals emergency department. We are also focused on mental health in the workplace, offering unlimited mental health benefits to our team members. After extensive consultation, BCE launched the first company-wide accessibility plan in 2023, allowing us to prevent and remove barriers to accessibility. The Bell team is working hard to make a real difference in the communities in which we serve. In terms of financial performance, in 2003 (sic) [ 2023 ], we saw solid financial results, and we worked hard to deliver for our shareholders, which included the 16th consecutive year of dividend growth. Having said that, I would acknowledge that there have been bumps on the road as we have navigated a period of transition. And like our telecom competitors, we have seen significant downward pressure on our shares. Persistent inflation, high interest rates, slow economic growth and an unfavorable exchange rate are affecting our business and the sector. I would also highlight a major challenge on the regulatory front. The federal regulator recently mandated Bell to provide access of our fiber networks to resellers, but that also included large telecommunications companies, our major competitors at artificially low rates. This decision is already having a negative impact on the current and future investments that we make, as we are challenged to spend our shareholders' money on infrastructure that benefits our competitors and impairs our ability to earn a reasonable return on that investment. Canada faces a productivity crisis and anemic economic growth, and penalizing companies and critical industries will only discourage in investment and move dollars, people and resources elsewhere. The networks we are building should be the basis for Canada's future economic growth, for productivity growth, for prosperity, and we would like to expand that reach to even more Canadians. But to do so, we do need a public policy environment that supports investment. Before I conclude today, I would like to take a moment to publicly welcome Johan Wibergh, who has joined the BCE Board in November. His experience in technology and innovation dating from his time as CTO of Vodafone and at Ericsson is already providing a valuable addition to our Board. I would also like to thank David Denison and Robert Simmonds, who are both retiring from the Board for their contribution over the past several years. David drew on his considerable knowledge of financial and pension sector to deftly lead our Management Resources and Compensation Committee. Bob's extensive experience in Canada's telecommunication sector provided an invaluable perspective on mobile networks and spectrum issues. They will both be missed, and we wish them the very best. Team Bell works hard every day to live up to our purpose and strategic imperatives. And I would also like to thank all of our employees and Team Bell for their continued hard work. I would also like to thank you, our shareholders, for your continued support. I trust that you share our confidence in the BCE Group of companies as we innovate and grow into the future. The meeting today will proceed as follows. After confirming the establishment of a quorum, we will proceed with the receipt of the 2023 consolidated financial statements and auditor's report. We will then vote on the election of directors, the appointment of auditors and an advisory resolution on executive compensation. To facilitate proceedings, I've asked Martin to move on all 3 motions. Our President and Chief Executive Officer, Mirko Bibic, will then address the meeting, following which we will announce the results of the votes. And finally, and perhaps most importantly, we conclude the meeting with a question-and-answer period, and we welcome your questions. Starting with agenda item #1. The scrutineers have provided me with their report on attendance, which will be filed with the records of the meeting. The attendance report, together with the proxies, which I hold confirm that shareholders representing a minimum of 25% of all the outstanding shares of BCE that are entitled to vote are in attendance at this meeting. I, therefore, declare that the meeting is properly constituted for the transaction of such business as may properly be brought before it. Now moving to item #2. The BCE Annual Financial Report for the year 2023 contains the consolidated financial statements with the auditor's report thereon. A copy of the 2023 annual financial report will be filed with the records of this meeting. Attending today, as I said, is Curtis Millen, our Chief Financial Officer; as well as representatives from Deloitte, your auditors, who are available on the phone to answer any questions you may have on our financial statements. Martin, are there any questions relating to this particular item of business?

No, Mr. Chair, there are no questions on this item of business at this point.

I remind you that the polls for all items submitted to a vote at the meeting is open. The next business on the agenda is the election of directors. There are 13 directors to be elected and 13 eligible candidates have been nominated. The director nominees of this meeting are Mirko Bibic, Robert Dexter, Katherine Lee, Monique Leroux, Sheila Murray, Lou Pagnutti, Calin Rovinescu, Karen Sheriff, Jennifer Tory, Louis Vachon, Johan Wibergh and Cornell Wright as well as myself, Gordon Nixon. And these are your Board nominees. We will now turn to questions related to this item of business. Martin, are there any questions related specifically to this item?

There are no questions on this item of business, Mr. Chair.

Thank you, Martin. Could we please proceed with the motion.

Mr. Chair, I move that each of the 13 persons previously named be elected as Director of BCE, Inc. until the earlier of the end of the next Annual Shareholder Meeting and the date they cease to hold office.

The next item on the agenda is the appointment of our auditors. I remind you that the polls remain open. Martin, are there any questions related specifically to this item of business?

No, there are no questions on this item of business, Mr. Chair.

Thank you, Martin, and please move the motion.

I propose that Deloitte be appointed as auditor of BCE until the next Annual Shareholder Meeting.

The next item on the agenda is the advisory vote on BCE's approach to executive compensation. Please note that voting on this, all matters will close after the motion is approved and this resolution is made. Martin, are there any questions specifically related to this item of business?

No, Mr. Chair, we have not received any questions on this item of business.

Thank you, Martin. Please move this motion.

Mr. Chair, I move that the advisory resolution on executive compensation be approved.

I now declared meeting on all matters is now closed. The results will be announced before the question and answer and comment period. Now I would ask Mirko Bibic, our President and Chief Executive Officer, to address the meeting.

Good morning, everyone. I'm pleased to speak to you from Montreal. This city is Bell Hometown and mine too. Its fitting that we're broadcasting from here. Bell's success have always been thanks to our agility in the face of changing market dynamics and a shift in the economic and regulatory landscape. Our purpose is to advance how Canadians connect with each other and the world. Our 6 strategic imperatives support this proposition, build the best network, drive growth with innovative services, deliver the most compelling content, champion customer experience, operate with agility and cost efficiency and image and invest in our people and create a sustainable future. I first thank Bell team for their impressive ability to live up to our purpose and strategic imperatives. As Gord mentioned, Bell is accelerating its transformation from a traditional telco to a company that's focused on communications, tech services and digital media. This is a company-wide effort. It touches everything we do from the customer experience to the networks we build, to the products and services we offered and to the way we work together as a team internally. We're embracing the transformation mindset. We're making the right near-term decisions. And at the same time, we're putting in place a solid foundation for long-term growth, and 2023 was another year of progress for Bell. We connected more homes and businesses to our fiber networks, and we made our wireless networks available to more Canadians. We continue to enhance the customer experience by adopting digital solutions. And Bell Media delivered Canada's most compelling news, sports and entertainment content pivoting to digital first experiences in response to audience preferences. At Bell, we offer customers the best products and the best services and those are backed by the best networks. Last year, we expanded our pure fiber network by 633,000 locations, and we expanded 5G and 5G plus wireless coverage. For the second year in a row, Ookla recognized Bell Fibe as the fastest Internet and WiFi in the country and global wireless solutions ranked Bell's 5G Canada's fastest 5G network for the third year in a row. As networks have expanded, prices for Internet and wireless services have declined. Internet prices are down more than 15% year-over-year. And since 2020, wireless prices have come down by 45%. In fact, Statistics Canada has identified the telecom sector as a leader in the fight against inflation. And this is at a time when Canadians feel they are paying more and getting less for everything else. Today, Canadians pay consistently less for wireless than in the U.S., and that's confirmed this week by the federal government's annual price comparison study. Provide an example. Bell currently offers a 75 gig plan for $60 compared to $104 on AT&T. That's more than $40 less for the same amount of data on a superior network, better quality and better network coverage. Great networks and lower prices are just the beginning. Here are just a few more examples of how our transformation is driving change. [Foreign Language] My Bell app, it's easier for a customer to access their bill, manage their services and access the virtual repair tool to fix common issues directly in the app. At home, a self-install offer as fast, convenient and safe way to connect to fiber -- to our fiber network. And we have enhanced our outage notification, helping customers to stay informed during extreme weather events. We are transforming a new way to sell innovative partnership that reach customers in more places and in an easier way. Here are a few examples. Earlier this year, Bell joined force with Best Buy Canada to operate 165 The Source stores rebranded Best Buy Express that will launch later. Through our partnership with Staples, we are reaching more small- and medium-sized business owners. A few weeks ago, we launched a partnership with No Frills to support budget-conscious wireless consumers with [ no name ] mobile and more. Bell's business [ model offers ] end-to-end expertise internally that we can then sell to our business clients. Here's how we help. Most large companies in Canada are Bell's clients and like us, most of them are undertaking their own digital transformation. And our networks, the best networks in Canada are the clear option for business transformation. And to transform, these companies need access to cloud services and cloud platforms like Amazon Web Services, Google Cloud, Microsoft Azure and ServiceNow. Bell has strategic partnerships with all of them. But moving apps and platforms to the cloud also requires IT expertise, and that's where our acquisition of Montreal-based FX Innovation comes in. FX has a particular expertise in helping customers move to the cloud, transitioning their workflows and processes from the old way of doing things to the new way of doing things. And of course, all this requires the best security, and we offer that too, and we are a trusted brand in security. In fact, we're the only Canadian telecom to partner with SentinelOne, a global leader in AI-powered security. [Foreign Language] Bell Media continues to deliver Canada's most compelling content in French and in English. When we work in our Canadian Survivor Quebec, original Survivor, Quebec, Amazing Race. Canadians continues to embrace Crave. We are the #1 Canadian streaming service and in 2023, was the most watched year in its history. We offer 13,000 hours of Francophone content on Crave and growing. Canadians wants access to content on [ genital ] platforms. And in response, we want to consist -- easy to find. We are exploiting new digital opportunity with fast channel for keys, news, sport, entertainment, any of these contents. [ TV first part ] which is approximately 3x more digital news stories in an average day then when Bell acquired it. These stories are available across our lineup of news applications like the BNN Bloomberg app, the CP24 app and the CTV news app. And soon, for the first time ever, CTV National News will have dedicated journalists telling stories from all 10 Canadian provinces. And the network now airs more original national newscasts than at any point in its 60-plus-year history as well as 25,000 hours of local news per year. I'm optimistic about Bell's future. We're hyperfocused on our customers. We offer the best fiber Internet Canada's fastest 5G network, a superior cloud TV platform and Canada's best streaming service. We're making it easier for Canadians to purchase our services and to control them, and our end-to-end business solutions keep getting better. Like so many businesses across the country, we're facing challenges. Gord mentioned some of them: persistent inflation, high interest rates and the impact that those have on our consumers. And our response to all of that is to transform. The success of our transformation will allow us to remain competitive, to deliver solid results and to be well positioned for the future. exciting possibilities lie ahead in areas like AI, advanced advertising, cloud and cybersecurity services and much more. Thank you for your trust. Thank you for your support, and now back to you, Gord.

Thank you very much, Mirko. And I will now ask Martin to provide the preliminary results of the scrutineers' tabulation of today's votes.

[Foreign Language] They confirm these results. All directors nominees received at least 97.7% of vote for, approximately 90.6% are favorable for the appointment of Deloitte as auditors. And the advisory resolution on the executive compensation is approved by approximately 94.7% of the votes. Scrutineers final report will be available shortly after the meeting.

We will now take questions and comments from our shareholders. Martin, can you just remind us of the procedures to ask a question?

[Operator Instructions]

So we received two questions about share price, so we'll answer them I'll read both of them and ask you to answer them all at once. So from a shareholder [ Sandeep Gol ], will someone be able to explain why the share price has dropped by 1/3 in the past 1 year? And from [ Jerry Plount ]. On January '18, BCE was at $56.2 per share. Since that day, the price has fallen approximately 20% to a low of $44.98 today. Can you please outline the main aspects of why BCE has experienced this drastic fall in share price? And second, what is the 1-year plan to recover the share price? Thank you. Thank you for your commitment to mental health initiatives.

Okay. Thank you both Sandeep and Jerry. Obviously, very timely, appropriate and good questions. And I will kick off and then I will turn it over to Mirko, who I'm sure will have something to add. The first point is the whole sector is under tremendous pressure. And there's a variety of reasons for that. High interest rates. We mentioned very slow economic growth. A very competitive environment. And we have 4 major telcos in Canada, probably one of the most competitive markets in the world. Just by comparison, on the wireless business in the United States, which is 10x our size, they have 3 major competitors being AT&T, Verizon and T-Mobile. Most countries around the world have 2 or 3, very few have 4. It's been a competitive environment and as I say, during a period of very slow economic growth. And as a result, the whole industry has underperformed the overall market. In terms of our positioning, we've slightly outperformed one of our major competitors and slightly underperformed one of the others, but the whole industry is under pressure. Having said all that, we believe our fiber strategy is certainly working. We spent a lot of money. You've heard about our significant CapEx programs over the last couple of years to put fiber in the ground and to expand our network. And we're very encouraged by the long-term aspect of this. I mean, ultimately, everybody is going to move towards a fiber network, and we are clearly the leader in terms of being in a position to have a well-built and expansive fiber network. And we think that the ability to capitalize on that going forward is going to be very significant. Mirko touched on a number of other initiatives underway. And as a result, we remain very optimistic with respect to the future. But clearly, we have found ourselves over the past little while operating in a very challenging environment, which has impacted our industry and a lot of other industries in Canada as well. With that, I'll ask Mirko perhaps to jump in and talk a little bit or expand a little bit on what we expect to do over the next year or so to get our share prices moving in the right direction.

Thank you, Gord. I was very well answered and covered. Thank you for the question. As Gord said, it's a very important one. Just to quickly add to some of the points that Gord mentioned that we're going to continue to make significant investments, particularly in our networks to continue to drive wireless and fiber Internet service revenue growth. And you can see that the benefits of the long-term approach we've always taken, we started our fiber journey in 2010. We're now -- everybody knows in 2024, and there's been billions of dollars invested in delivering the very best Internet networks to Canadians, and that's allowed us years ago to be in a position of weakness when it came to Internet market share to now approaching 50% market share in some geographies. And we're going to continue to drive forward because when you offer the best customer experience on the best networks, you will drive revenue growth and ultimately, the share price will follow. On the media side, I touched on it in my opening comments. It's really -- we're undergoing a significant -- essentially turbulent in the Canada media industry with much of the ad revenues having been taken by global web giants who come into Canada and are competing against us without contributing to the Canadian media sector. But by pivoting ourselves to digital, delivering the best content on the platforms that Canadians want, we're going to see a recovery in advertising as we take our share of digital advertising revenue as well. And I spent some time in my opening remarks, which I won't repeat, on how we're going to drive revenue growth in the enterprise sector, and that's by offering innovative business solutions, along with the best connectivity. So as we put all those things together and have a focused strategy and make investments in the right places, we're going to see our revenues grow, our earnings grow and our share price should follow, especially as some of the macroeconomic factors that Gord highlighted dissipate.

Thank you, Mirko. And perhaps we'll do 1 quick one on the screen, and then we can move to the phone if there are any questions.

Yes, we don't see any on the phones for now, but -- so keep going. Next question from Scott Bradley. With respect to shares owned or held by directors, why does Johan Wibergh not personally own a single share of BCE.

Well, firstly, he does own DSUs, which are similar to shares, but we have a director shareholder requirement of which DSUs are included. And it's one of the most aggressive of almost any Canadian company. And if you look in our proxy, you'll see significantly shares held by all of our directors. We do provide a time period for new directors to get up to those levels, and rest assured that Johan will be at and through our minimum levels in a very short period of time. So that will correct with time. I would encourage you to look at the minimum requirements, which are included on our proxy documents.

We still have no questions on the phone. So we'll keep going with questions online, it's from an anonymous shareholder. When it comes to environmental commitments, how do you compare to your peers in the telecom industry?

Thank you. Thank you for that question. It is a very topical one. So [ giving you ] the headline answer would be that because we are the largest fiber provider in the country right there, we are ahead of our peers as fiber is cleaner technology than cable in the sense that is less energy-intensive. But we've been focused on energy efficiency for decades, and we've been delivering large greenhouse gas emission reductions for many years, and we're going to continue to progress on that journey over time. I'll give you some key milestones that we're very proud of. We're the first telecom company in North America to have our energy management system certified to the ISO 5001 (sic) [ 50001 ] standard, and that was in 2020. We calculate and report on our carbon footprint via the carbon disclosure project, and we've done that every year since 2003. We formed our own carbon reduction task force, that was in 2021 and an innovation working group in 2022. And we continue to increase our investments to decarbonize our operations, and we've done that with the introduction of a green budget, and we expect to start seeing savings from these projects in 2024 and 2025. So I mean -- I highlight those examples to tell you that we've been on this journey for many years. We've reached a certain number of milestones and it's because, again, having a plan in place for years, working to that plan, measuring our performance, adjusting and we'll continue to do that. Thank you.

Thank you. So still no questions on the phones, keep going online. Next question is from [ Angela Acre ]. With all the financial pressure that is the expected -- what is the expected impact, sorry, on dividends? How can you continue to increase dividends in this cash flow environment?

The -- a very good question. And obviously, our payout ratio is through our stated objective, which is 65% to 75% of free cash flow. And what we have been trying to do is balance the appropriate capital allocation between investment in the future, investment in infrastructure and return to shareholders. First and foremost, I think it's important to acknowledge that BCE is very much a dividend stock. It has been for almost -- for certainly over the last 20 years. And if you look at our history and our objectives, which are annual dividend increases, we've been able to increase our dividend annually going back, I think it's 17 years, although we did reduce the growth rate of our dividend this year. We always were within our range. Unfortunately, COVID threw a real wrench into that. And coming out of COVID, we have constantly been above our 65% to 75% range. And one of the reasons for that is because we've used so much of our free cash flow to invest in fiber and infrastructure, which is as both Mirko and I have said, is critical to the future. We're going through this period now of heavy CapEx which has elevated our payout ratio, which is one of the reasons we reduced our growth rate. This year, it was 3%. But going into the future, ultimately, you will see a shift in terms of reducing CapEx and more free cash flow, so that we would very much like to get back to our objective of 65% to 75%. And I think we've been very transparent with the investment community in terms of the time frame that it will take us to get back there. As we move forward, though, we continue to recognize that, as I say, we are a dividend stock. Our shareholders not only expect dividends but are expecting dividend growth. And that's part of the reason that we are able to attract capital and to attract investments. So we've gone through this transitional period, but hopefully, there is a light at the end of the tunnel.

If I may, I'd just like to highlight a couple of points that you surfaced, Gord. In 2020, with the onset of COVID, while many companies in the country cut back on investment, Bell did the opposite, and we leaned in. And it's at that point in time that we announced -- as you mentioned, we announced an aggressive capital expenditure program, the most aggressive CapEx program in the history of this country. And last week, was our 144th year birthday. So we've been on the most aggressive investment program in the history of this company. And we spent -- by the end of this year, we will have spent $23 billion since 2020, delivering the best fiber Internet and the best 5G, 5G+ networks and other services to Canadians. And at that time, when we announced the aggressive program in 2020, as you mentioned transparency, we outlined back then that until 2025, we would therefore be operating at a payout ratio that's higher than our stated policy. And it's because we were making long-term strategic investments that will sustain us for decades to come.

We got a related question coming in, so I'll read it in case you want to add anything to your answers from Doug [ Drummond ]. As stated in the annual report, the target dividend payout ratio is 65% to 75%. However, it is currently running at 111%, but there have been media reports that it is actually much higher than that when you include lease costs that are not included in the pay ratio calculation. Is this actually true? Second question, when do you expect the payout ratio to be reduced to the target range? And third question, can you comment on your level of concern as to whether the dividend will have to be cut in the near term as the media is starting to poke at?

Thank you for that question. So I'll start with the last part. I was actually asked a similar question by a telecom analyst in this morning's call where we were discussing our latest quarterly results. And the dividend for 2024 was announced in February and the dividend will remain as it is, and that reflects a 3% dividend growth for 2024. So I can categorically tell you that, that will be the dividend for 2024. In terms of the payout ratio, I think we've answered that in the previous answer. We will be operating at a payout ratio that's above our stated policy until the end of 2025, and then we'll work to get it back down and as our historical CapEx program starts to subside. And on the way we calculate free cash flow, we've been consistent for years and years, and nothing has changed in that regard, and there are no new developments. And how we calculate free cash flow has been clearly identified in our financial statements for the entirety of that time period. Thank you for the question.