BCE Inc. (BCE) Earnings Call Transcript & Summary

[Interpreted] Good morning, and welcome to BCE 2025 Annual General Shareholder Meeting. My name is Gordon Nixon, and I am pleased to preside over this meeting as Chair of the Directors of Bell BCE. I would now call the meeting to order. To begin, I wish to acknowledge that we are joining you today from Montreal located on the traditional territory of the Kanien'kehá:ka place which has long served as a site of meeting and exchange among many First Nations. We are dedicated to fostering positive and mutually respectful relationships with indigenous people and communities. Today is the sixth consecutive year that I've conducted our annual meeting virtually, a format that we adopted during the pandemic, but one that has served us well. A virtual meeting enables shareholders across the entire country and a broad spectrum to attend and enjoy an equal opportunity to participate in the meeting, and we have made every effort to ensure shareholders have the same rights and abilities to participate as they would at an in-person meeting. We have, however, heard from some shareholders that they would like to have the option to attend our AGM in person. We acknowledge that request, and we have announced that as of 2026, except in the case of a force majeure event such as a pandemic or exceptional circumstances, including one that may have physical security or public safety implications, we intend to hold our Annual Meeting of Shareholders through a hybrid meeting format that includes an in-person component. Given this, there will not be a vote on shareholder proposal #2. We will shortly go over the procedures of the meeting and how shareholders can vote, raise points of orders, make motions and speak to shareholder proposals and then importantly, 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 bottom of the 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. 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 to the language of your choice that is indicated on the website. I will now introduce the members of the BCE team joining me here today. Mirko Bibic is our President and Chief Executive Officer; and Melanie Schweizer is our Senior Vice President of Corporate Services and our Corporate Secretary. In accordance with the BCE bylaws, I, as Chair of the Board, will act as Chair of this meeting, and Melanie will act as Secretary. Also attending today's meeting via phone are TJ Singh and Paul Fletcher, representatives of Deloitte, the shareholder auditors for the year 2024; as well as Mark Forman and Janice Rath, who are representatives of Ernst & Young, the proposed shareholder auditors for the year 2025. Curtis Millen, our Chief Financial Officer, is available on the phone to answer any questions. Other members of the Board of Directors and senior management are also viewing via webcast. Before we begin, I would like to ask Melanie to take us through the procedures of today's meeting.

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 submitted a proxy as your proxy holder will vote on your behalf. Starting now, you can register your vote on all items of business for today's meeting. To vote, click on the voting tab on the left 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 be automatically submitted to our transfer agent after you make your selection. Votes may be changed up to the time voting is closed. The poll will remain open until the Chair declares voting on all matters closed. Preliminary results will be announced later this morning, and final results will be posted on our website. [Interpreted] Shareholders can ask questions at any time in French or in English until the Chair closes the question period at the end of the meeting. We recommend that the questions be submitted as soon as possible during the meeting to be answered in a timely manner. To ask a question in writing online, click on the messaging tab on the left of your screen and submit your question. Your question will be read at the appropriate time. Assuming they've been submitted in sufficient time, questions related to the matters of business to be voted on will be addressed at the time such matter is being discussed. Other questions will be addressed during the question-and-answer session -- of the meeting has been completed. [Operator Instructions]. [Interpreted] These procedures briefly described above also apply to motions, including to agenda of the meeting. For additional details, please review our code of procedures and the Lumi user guide available on our website and on the Lumi web platform. The meeting questions should be of interest to all shareholders and not personal in nature. If your question is related to a personal matter, your question will not be read and instead a BC representative will communicate with you after the meeting if you've provided your contact information. To allow us to respond to as many questions as possible, we will limit each shareholder to one question and ask that it be succinct and limited to a maximum of 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 want to make sure we can be responsive to as many shareholder questions as possible during the 90 minutes we have allotted for this meeting. Written questions on the same topic or otherwise related will be grouped together and addressed at the same time. Any questions that cannot be answered during the meeting due to time constraints will be posted on the BCE website with the corresponding answer as soon as practicable after the meeting. I would now like to bring your attention to the notice appearing on screen. Today's remarks will contain forward-looking statements. These are based on several assumptions and are subject to important risks. The notice on screen contains a cautionary statement in this regard and is made on behalf of each 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 of the meeting. Mr. Chair, I now turn the meeting over to you.

Thank you very much, Melanie. Thank you for being with us today -- everyone, for joining this meeting. As Canada's largest communications company, Bell provides fiber, Internet, 5G wireless, TV, media and technology solutions to customers across our country. BCE is an iconic Canadian company with a history of adapting to fast-changing environments. 2024 was, as you know, a challenging year across the industry. We faced headwinds, including aggressive competition on pricing, an unfavorable regulatory environment and slowing market growth. For these reasons, we focused our growing on our core business and taking advantage of new opportunities that will set us up for long-term success and sustainable value creation. We are committed to winning back investor confidence by ensuring that shareholders understand how we are generating value today and setting the business up to deliver even greater value tomorrow. Management has been working hard over the past year to put in place the foundation for growth and success this year and beyond. This includes the 2025 -- sorry, this includes the proposed acquisition of Ziply Fiber, a high-quality, high-growth, fiber-first Internet services provider operating in the U.S. Pacific Northwest. Today's announcement of Network FiberCo, our strategic partnership with Montreal-based Canadian Pension Fund, PSP Investments, supports Ziply Fiber's expansion without significantly impacting BCE's balance sheet. The appointment of a dedicated Chief Commercial and Experience Officer was also done. The creation of Ateko, the Bell Business Markets division charged with delivering leading technology solutions to our enterprise customers. Our aggressive digital media and content strategy anchored by Crave as well as harnessing the power of technology, automation and simplification that ultimately will drive cost efficiencies. We are excited. And to you, our investors, I want to say that we are listening. We have the assets, the team and the plan to deliver for you and our customers and our communities, both now and into the future. The focus of the past year has been on reducing costs and strengthening our balance sheet while also putting in place the building blocks for growth. We remain focused on maintaining an investment-grade credit rating for our senior debt as well as lowering our leverage ratio. We know the dividend has been a topic of heavy discussion. We have an elevated dividend payout ratio that is outside our policy range, which has been causing pressure on our share price. As a Board, we are focused on addressing these concerns. We have spent considerable time with our shareholders, and we have heard your perspectives. We must address a number of significant changes in our operating and economic environment that have occurred since November when we paused our dividend growth. There has been heightened economic uncertainty related to the ongoing global trade war, which very likely will slow the pace of economic activity and increase inflationary pressures, both in Canada and around the world. Many economists are now predicting a global recession. Recent surveys suggest a sharp drop in consumer confidence and a slowdown in business spending as companies postpone or cancel investments. Additionally, the reduction in BCE share price has resulted in an elevated dividend yield and therefore, a high cost of capital. At the same time, an unsupportive regulatory environment and ongoing competitive pricing pressures and a slowdown on immigration has added further complexity. So much has changed since November. And considering these factors, as you know, this morning, we have made the necessary decision to adjust our dividend. The annualized dividend per BCE common share will be established at $1.75. Concurrently, we're establishing a new long-term common share dividend payout ratio to target a payout ratio range of 40% to 55% of free cash flow. This policy range provides us with much greater flexibility for both deleveraging and investing in future growth. To make it easier for our investors to consider the effect of capital leases on our cash flow, we will also begin to disclose our free cash flow after capital leases repayments going forward. The adjusted dividend will free up approximately $2.1 billion in capital that we will use to strengthen our balance sheet. By the end of 2027, we expect to achieve a net debt leverage ratio of approximately 3.5x adjusted EBITDA with a long-term goal of approaching or going below 3% by 2030. We will also eliminate the discount feature of our DRP effective with the Q2 dividend payment on July 15. The decisions we announced today are the right ones for the right time. They show disciplined execution against the road map we showed investors and management showed and discussed with investors in February and provide clarity on our capital allocation priorities. Our plan focuses on strong free cash flow generation, selling noncore assets and thereby reducing debt. All our actions position us for a resilient dividend-paying company, featuring a very sustainable long-term dividend that will continue to provide our shareholders an attractive yield. At the same time, we are boosting growth through strategic acquisitions. For example, we are using the net proceeds from the sale of our ownership stake in MLSE to acquire Ziply Fiber. By doing so, we are converting a passive investment that generates little cash into a fast-growing revenue-generating business line, which is in our core strategic area and a business we know extremely well. I'll let Mirko go into details later, but suffice to say that the strategic redeployment of capital back into our core business, fiber, demonstrates that we are committed to driving growth. We are also carefully reviewing all of our noncore assets, and we'll continue to look at monetizing them where it makes financial and strategic sense with the objective of continuing to strengthen the balance sheet. Before I conclude, I would like to touch on an important issue for Bell and indeed for Canada as a whole at this transformational moment in our country. As Canada faces threats to its economy, it's more important than ever to encourage investment in this country by strong Canadian companies. It doesn't get much more Canadian than Bell. Bell traces its roots back to the 1880s, just 13 years after confederation. Today, we connect 99% of communities in all 13 provinces and territories, and we provide services to millions of Canadian customers. We are a leader in R&D. We invest more than $500 million per year to support Canadian researchers, among the highest level of investment of any Canadian company. Most importantly, we build the sovereign critical infrastructure that powers the Canadian economy. As external threats increase, it is existential for Canada security that the government create the policy and regulatory conditions to improve and to enhance connectivity. In this context, we believe the CRTC's decision on wholesale fiber access is baffling. It is not the right policy. It is the wrong policy at the wrong time and will both discourage investment and will not strengthen Canada's infrastructure. allowing the largest communication companies to resell services on each other's network reduces the incentive to invest in new network infrastructure. Less investment means fewer jobs along our supply chain, diminished network resilience and fewer Canadians getting access to the world's best Internet technology, particularly in rural and remote communities. Bell has already revised its fiber build target down by 1.5 million locations as a result of the decision, and we've cut our capital expenditures by $500 million this year alone. We want to spend more money in Canada, and we implore the CRTC and the new federal government to reverse its policy and implement solutions that drive investments that create jobs and that enhance connectivity. It is critical to our future competitiveness. Looking ahead to the rest of the year and into 2026, the overreaching challenges of the industry are not going away. However, we are very excited to reset, and I want to assure you that we are agile and have taken the steps to meet our financial goals and ensure balanced growth. We are keenly aware of the global economic shifts, and we will adapt to meet these challenges. Our Board will continue to provide robust oversight on Bell's long-term capital allocation strategy. We are also looking to attract new talent to the Board. In particular, we're seeking a candidate with expertise in U.S. telecom market in light of the Ziply acquisition and the launch of our strategic partnership with PSP Investments. We spent a considerable amount of time with our shareholders and analysts listening to their perspectives on a number of years. We appreciate that many shareholders would like us to focus on deleveraging and prudent fiscal management, and that is what we are doing, and we will continue to be open and transparent with our shareholders and provide clarity with respect to our plans. Our Board and the entire Bell team is energized, and we are focused on executing a clear plan that will accelerate our growth next year and for the years to come. Thank you to you, our shareholders, for your confidence in the direction of the BCE Group of companies as we continue to adapt and to deliver for our customers and investors. Today's meeting will proceed as follows. After confirming the establishment of a quorum, we will proceed with the receipt of our 2024 consolidated financial statement and auditor's report. We will then vote on the election of directors, the appointment of Ernst & Young as our new auditors, an advisory resolution on executive compensation and 2 shareholder proposals. To facilitate the proceedings, I have asked Melanie to move the first 3 motions before we get to the proposals. Our President and Chief Executive Officer, Mirko Bibic, will then address the meeting, following by which we will announce the results of our votes. And finally, and perhaps most importantly, we will conclude the meeting with a question-and-answer session. Starting with agenda item #1, the scrutineers have provided me with their report on attendance, which we will be filed with the records of today's meeting. The attendance report, together with the proxies, which I hold, confirm that the shareholders represented at least 25% of all the outstanding shares of BCE that are entitled to vote or are in attendance at this meeting. I therefore declare that the meeting is properly constituted for the transaction of such business as may be brought before it. Now moving to item #2, the BCE Annual Financial Report for the year 2024 contains the consolidated financial statements as well as the auditor's report there upon. A copy of the 2024 annual financial report will be filed with the records of this meeting. Attending today is Curtis Millen, our Chief Financial Officer; as well as representatives from Deloitte, your auditors for the year 2024, and they are available on the phone to answer any specific questions you may have on the financial statements. Melanie, are there any questions related specifically to the financial statements?

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

I remind you that the poll for all items submitted to a vote upon this meeting are open. The next item of business on the agenda is the election of directors. There are 13 directors to be elected and 13 eligible candidates who have been nominated. The director nominees for today's meeting are: Mirko Bibic; Robert Dexter; Katherine Lee; Monique Leroux, Sheila Murray; Louis Pagnoti; Calin Rovinescu; Karen Sheriff; Jennifer Tory, Louis Vachon, Johan Wibergh and Cornell Wright along with myself, Gordon Nixon. These are the Board nominees. And we will now turn to questions related specifically to this item. Melanie, are there any questions related to the Board.

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

Thank you, Melanie. Could we proceed with the motion.

Mr. Chair, I move that each of the 13 persons previously named be elected a Director of BCE, Inc. until the earlier of the end of the next annual shareholder meeting and the date they cease to hold office.

Thank you, Melanie. The next item on the agenda is the appointment of Ernst & Young LLP as BCE's new auditors. Mark Forman and Janice Rath, representative of Ernst & Young, are attending today's meeting via phone. As described in the proxy circular, in keeping with our focus on strong corporate governance practices and given the long tenure of Deloitte LLP as the corporation's auditors, we have conducted an RFP process. And after careful consideration and the recommendation of the Audit Committee, the Board selected Ernst & Young LLP as successor auditors of the corporation for the financial year ending December 31, 2025, subject, of course, to shareholder approval. Ernst & Young LLP was selected based on qualifications of its audit team, staffing model, technology as well as its independence. We extend our thanks to Deloitte LLP, who did a terrific job for the quality of expertise and the insight that they have provided over many, many years. I would remind you again that the polls are open. Melanie, are there any questions with respect to this item of business?

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

Thank you, Melanie. Please move that motion.

Mr. Chair, I move that Ernst & Young LLP be appointed as auditors of BCE until the next Annual Shareholder Meeting.

Thank you, Melanie. The next item on the agenda is the advisory vote on BCE's approach to executive compensation. Melanie, are there any questions specifically related to this item of business?

Mr. Chair, we do have questions we received in advance from shareholders on executive compensation, specifically relating to the CEO and other executive officers. I'll summarize the question as follows. Could you please explain how the executive compensation policy and how bonuses are determined.

Yes. I mean I would say that we have a very robust Compensation Committee, our MRC committee. And philosophically, our objective is to attract and to retain a very strong and top-quality management team. We have an adviser that advises the Compensation Committee with respect to executive compensation. A large portion in the case of the CEO, 89% of compensation is at risk, which perfectly aligns the compensation of our CEO with the performance of the company and the performance of the share price. And in fact, this year, you will see in the proxy circular, there is a look back, which shows what actual compensation levels are versus what were stated in the proxy circular. And of course, given the share price performance, there is quite a variance. Our compensation structure is reviewed by the 2 proxy advisers, ISS as well as Glass Lewis, and both have received very positive grades. And so we're very comfortable that our compensation committee does an outstanding job in terms of ensuring that we have the right process, that we have the right alignments and that our target compensation, which is targeted for sort of midrange of a comparator group is accurate. Can we now move the motion.

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

Thank you, Melanie. The last items to be submitted to a vote are 2 shareholder proposals. Please note that all voting on matters will close after these items. As a reminder regarding the previously submitted but withdrawn shareholder proposals in respect of the AGM format, as mentioned at the outset of this meeting, as of 2026, we have announced that we intend, barring exceptional circumstances as described earlier, to hold our Annual Meeting of Shareholders through a hybrid format that includes an in-person component. Given this commitment, MEDAC has agreed to withdraw the shareholder proposal #2. Therefore, we will not have a vote on this proposal. I would invite Mrs. Alice Chipot, the representative from MEDAC to present and move shareholder proposal #1 and 3. Operator, please open the line for Madam Cha.

[Interpreted] So hello, everybody. Thank you for having me today as representative of MEDAC for the 2 propositions that you voted for. So I will present the first shareholder proposal, which is for the divulgation of languages mastered by employees. So therefore, propose that the languages mastered by employees be divulged by ventilating the information by jurisdiction for all territories, countries, territories where the company has activities. At the moment of hiring, the competency of the candidates are evaluated to determine if they satisfy our requirements for the employment for which they posture. Of those, they include language competency. Information is known by all companies, and that information exists in its statistical form and interest for all, which is why we would invite you to support our proposition for the languages mastered by employees. And actually, before moving on to the third, I just want to confirm that the second has actually been removed from the vote. So that on the in-person AGAs since the company has committed to -- and this one has been published that in 2026, except in the case of major forces, the AGAs will pick a hybrid form with all components in person and a virtual component, which satisfies the MEDAC, and thank you for this. As for Prop 3, which will be voted on, it concerns the AI systems, advanced Generative AI system and a code of conduct. It is proposed that BCE adhere to the voluntary code of conduct for the development of a responsible management of AI systems. We all know the development of AI presents challenges for companies as for society. So we think that a better support is necessary when the policy should be closely associated to the principle of the voluntary code of conduct. The standards for AI evolve quickly, and we estimate that a policy and a process that is robust are necessary, which is why the proposition to adhere to the code of conduct. I won't take any further time, but I would like to ask you to vote for #1 and #3.

Thank you very much, and we appreciate your input and your thoughts. Melanie, are there any questions online related to the shareholder proposals?

There are no questions online or on the phone related to this item of business, Mr. Chair.

Thank you very much. And I now declare that the voting on all matters is closed. The results will be announced before the question-and-answer session. And with that, it's now a pleasure to ask Mirko Bibic, who is our President and Chief Executive Officer, to address the meeting.

Thank you, Gord. I'm pleased to be here today to discuss BCE's strategy for the year ahead and beyond. [Interpreted] Firstly, when I talk about 2024 and 2024, we laid the groundwork for a significant repositioning of our company, cutting costs, strengthening our balance sheet and sharpening our focus. We are resilient in the face of unprecedented regulatory challenges, intense market competition and turbulent macroeconomic and geopolitical environment. We stay focused on our core business for growth and it's anchored in 4 key priority areas. We're putting the customers first. We're providing the best fiber Internet and wireless 5G. We're unlocking potential for businesses with technology solutions and building a digital media and content powerhouse. By building and executing on these 4 areas, we will deliver for all stakeholders. At Bell, putting customers first is our top priority. Earlier this year, as Gordon mentioned, we became the first Canadian Telecom to name a dedicated Chief Customer Experience Officer. And since taking on this role, Hadir Hassan has been hard at work developing a better customer experience, and the experience is grounded in 4 key commitments: that your time matters; we'll keep our promises; we'll make it intuitively easy and will provide a one Bell experience. The target is for you to be at the core of our business. So whether you're signing up making changes or troubleshooting. We know your time is valuable. That's why we offer a growing range of self-service options, including 24/7 AI-powered virtual assistants. Self-serve tools help you to get the support you need wherever you need it day or night while keeping our phone lines free for more complex cases or people who prefer to speak to someone directly. And we're hard at work improving the tools and information available to our representatives. So no matter how you interact with us, our team will have access to the same up-to-date information. And because we know that life doesn't wait, we're enhancing our callback experience so that our team can follow up and make it right without you having to sit on hold. This will be a whole new Bell and we'll continue to raise the bar each and every day and in the year to come. Next, our priority is to get the best fiber Internet, 5G wireless. Our network are the critical infrastructure that powers Canada's digital economy across the country, 7.8 million homes and businesses have access to our pure fiber network. 5G wireless reaches 87% of the population and the 5G plus now reaches 60% of the population. I repeat it every year, but optical fiber is the best technology -- Internet technology hands down. And our strategic investment is paying off. 3 billion residential Internet customers are now on the fiber. This segment saw 10% growth year-over-year in 2024. And there's room to grow with 3 million additional fiber location ready to go but not yet signed up. And that brings me to Ziply Fiber. This transaction opens the door to an attractive U.S. market, the Pacific Northwest, where fiber deployment lags, population growth is robust and the regulatory environment is favorable. The opportunity for BCE is significant. To finance the deal, as Gord said, we effectively traded a noncore asset, which is our stake in MLSE in exchange for a long-term revenue and EBITDA growth engine. Ziply Fiber's performance speaks for itself. In 2024, it achieved significant fiber subscriber growth and EBITDA growth. This is a clear demonstration of its ability to generate meaningful and sustainable financial performance, and we aren't slowing down. Earlier today, we announced a strategic partnership between BCE and Montreal-based Canadian Pension Fund, PSP Investments, to support Ziply Fiber's expansion. This partnership will accelerate the development of fiber infrastructure through Ziply Fiber in underserved markets in the United States. The partnership will target development of up to 6 million fiber passings, enabling Ziply fiber to reach up to 8 million fiber locations over time. This strategy will combine the expertise of Ziply and Bell's resources, financial acumen and experience in infrastructure investment in PSP. We will be able to support the expansion in the U.S. through a capital-efficient platform, while reducing the financial contribution of BCE. Today's announcement reinforce our commitment to deliver long-term value to shareholders while maintaining financial discipline. Our priority is to unlock the potential of businesses with the best technology solutions, backed, of course, by our leading fiber and wireless networks. We've set an ambitious goal to become a $1 billion tech services organization by 2030, and we're well on our way. We launched Ateko Bell Canada division based here in Montreal. Ateko short for automation and tech collaboration is an all new technology solution provider. Ateko brings together under the same banner, the innovation technology start-ups recently acquired FX Innovation based in Montreal CloudKettle and HGC Technologies. It is a very competitive differentiator, uniquely positioned to disrupt the industry and deliver better outcomes for our customers. Automation experts will draw on their experience in the world's largest hyperscalers and automation platforms like AWS, Azure, Google Cloud, Salesforce and ServiceNow to help customers streamline their operations, improve automation, enhance customer experience and facilitate smarter data-driven decision-making. Our fourth priority is to build a digital media and content powerhouse. Bell Media continues to deliver Canada's most watched content in English and in French when and where Canadians want it. Digital now accounts for 43% of total media revenue, up from just 17% in 2021. It's the direct result of a well-timed and strategic pivot that distinguishes us from our Canadian competitors. This digital growth will be the foundation for Bell Media's financial stability and will continue to drive meaningful free cash flow for investors. More than half of our significant digital revenue now comes from direct-to-consumer streaming of Crave, TSN and RDS content and also Crave with ads, Prime Video channels, Connected TV and other ad-supported streaming options like our FAST channels. 2024 was Crave's most watched year ever, and our subscribers now number 4 million nationwide. Bell Media offers the best platform and the best content. The population continue to choose Crave for its greatest mix of premium Canadian Originals Networks EMPATHIE, [ So long Milan and Survive Quebec ] along with international favorites. Crave will remain the exclusive Canadian home of HBO and Max content for years to come. Yes, that means many more seasons of The White Lotus and The Last of Us for fans to look forward to. RDS and TSN continue to deliver world-class sports from hockey to baseball on different TV feeds, especially streaming radio and mobile ads. In the year ahead, we'll continue to invest in the digital media and the best content to bring more Canada to a global audience. We do business. We have a number of initiatives underway, including the digital solutions for our customers, which I mentioned earlier, and of course, continuing to move customers off of copper and on to our fiber network. When we started this work in 2022, we set a target cost savings of $1 billion by 2028 or sooner. By the end of 2024, we'd already realized half that amount, $500 million. So we're setting a new goal to realize savings of $1.5 billion by 2028. As Gord noted in his introductory remarks, we spent a great deal of time with our shareholders discussing their perspectives and carefully evaluating the opportunities and the challenges before us. The decisions we've made to strengthen our balance sheet reflect the realities of today's operating environment, but they're also deeply rooted in our commitment to positioning BCE for long-term growth. By prioritizing financial flexibility and balance sheet strength, we are ensuring that we can drive forward through any circumstance such as economic, geopolitical or regulatory uncertainty or instability. We, therefore, remain focused on executing on the road map we shared with you earlier this year from generating substantial free cash flow and divesting noncore assets to pursuing transformative opportunities like the Ziply acquisition, every step we take is aimed at creating long-term value for shareholders. These decisions are the result of disciplined planning, rigorous analysis and a clear-eyed view of what's best for BCE for our customers and our shareholders in both the short term and the long term. We're confident that they will strengthen BCE's foundation. I'm really optimistic about Bell's future. We have a clear plan grounded in concrete priorities and focused on what we do best, which is connecting Canadians, helping businesses succeed and sharing Canada's stories with each other and the world. For 145 years, Bell has been there for Canadians. We've succeeded by adapting to change to deliver for our customers and our shareholders. Today, we've got the right strategy and the right team to deliver long-term growth and create lasting value. We will create value for our customers, our communities. Thank you. And now I will hand over back to Gord for comprehensive review. I would now ask Melanie to provide the preliminary results of the scrutineers' tabulation of today's votes.

Thank you, Mr. Chair. The scrutineers confirm the following preliminary vote results. All director nominees received at least 95% votes for. At least 98% of votes are in favor of the appointment of Ernst & Young as our auditors. The advisory resolution on executive compensation is approved by approximately 92% of the votes. Approximately 96% of the votes are against shareholder Proposal 1, and therefore, it is defeated. And approximately 94% of votes are against shareholder proposal 3, and therefore, it is defeated. The scrutineer's final report will be available shortly after the meeting.

Thank you very much, Melanie. And we will now take questions and comments from our shareholders. I would ask Melanie one more time to remind us of the procedures to ask a question.

Thank you, Mr. Chair. To ask a question in writing on the messaging tab on your screen and submit your question. [Operator Instructions] The rules of procedure that we outlined at the beginning of the meeting will continue to apply for this question-and-answer session.

Thank you very much, Melanie, and it's good timing. We planned 45 minutes for question. It's 10:15. So we've got lots of time, and we look forward to any comments or questions. So Melanie, do we have any questions?

I believe, Mr. Chair, we have a question on the line from MEDAC. Operator, can you please open the line?

We give the results of the vote in a positive way. So please precise number of votes in favor that take place -- that took place for the proposal #1, proposal #2. And thank you.

As mentioned, these results are the preliminary results, and we'll be posting the final results and scrutineers' report on our website shortly after the meeting. But it was approximately 4% of votes were for shareholder proposal #1 and approximately 6% of votes are for shareholder proposal #3. Looking for additional questions.

Any further questions?

Mr. Chair, there are no further questions in the queue at this time.

Okay. Well, there were a lot of announcements this morning. So perhaps a lot of the questions were answered. We had a full 40 minutes of questions last year, but I guess there are none.

Checking again. There are no questions.

There are no questions. Okay. I won the pool. There being no further questions, I now declare that the question-and-answer session be closed. We thank everyone for their participation in our Annual Shareholders Meeting and for your continued confidence and support of the Bell team. Thank you very much.

Thank you. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]