UPDATE 3-BCE profit falls on taxes, shares slip

* Q3 EPS C$0.74 vs C$0.83 year earlier

* Lower tax expenses boosted year-earlier profit

* Operating revenue up 1.5 pct to C$4.98 bln

* Net postpaid subscriber additions up 17.1 pct

* Shares drop 1.3 pct in Toronto

Nov 1 (Reuters) - BCE Inc, Canada's biggest telecom provider, said on Thursday its quarterly profit had fallen from a year earlier, when lower tax expenses boosted results, and its shares fell even as it reported strong wireless and media results.

BCE, Bell Canada's parent company, offered no news on its proposed acquisition of Astral Media Inc. BCE recently delayed the C$3 billion deal's closing after it was blocked by Canada's broadcast regulator on competition grounds.

In media, BCE said coverage of the London Olympics , led by C TV, helped boost revenue. It acquired CTV, Canada's biggest private broadcaster, last year.

In wireless, the company added almost twice as many lucrative postpaid wireless subscribers in the third quarter as i ts r ival Ro gers Communications Inc.

``The results were in line with expectations, but wireless results were superb,'' said Desjardins Securities analyst Maher Yaghi.

Postpaid subscriber numbers are watched closely because those c ustomers, w ho often sign multi-year contracts, typically pay more each month than prepaid subscribers.

Like Rogers, BCE signed up more new smartphone customers, r aising the proportion of its postpaid users w ith s martphones to 60 percent from 43 percent a year earlier.

The company said some of the subscriber gains were in western Canada, where it has opened more retail outlets. Ya ghi said a focus on growing in that region seemed to be paying off.

``The economy is stronger,'' he said. ``There's more business customers, there's more international calling south of the border, because of the type of industries they work in.''

Bell added 148,502 net postpaid subscribers, 17.1 percent more than in the same quarter last year. Rogers said last week it had added 76,000 net postpaid subscribers. BCE's other major wireless competitor, Telus Corp, is set to report earnings on Nov. 9.

BCE's wireless customers paid an average of C$57.30 each month, up from C$55.01 a year earlier.

Overall, BCE's earnings before interest, taxes, depreciation and amortization rose 4.0 percent overall.

BCE's stock was down 1.3 percent at C$43.09 in early trading on the Toronto Stock Exchange on Thursday.


Net income attributed to shareholders for the third quarter fell to C$569 million ($569 million), or 74 Canadian cents a share, compared with C$642 million, or 83 Canadian cents a share, a year earlier.

Excluding severance and acquisition costs and other items, adjusted earnings fell to C$588 million, or 76 Canadian cents a share, compared with C$724 million, or 93 Canadian cents, a year earlier. Analysts, on average, had been expecting earnings of 77 Canadian cents a share, according to Thomson Reuters I/B/E/S.

Operating revenue rose 1.5 percent to C$4.98 billion, slightly above average analyst estimate of C$4.94 billion.

In vetoing the proposed Astral acquisition, the Canadian Radio-Television and Communications Commission said Astral's media properties would give too much market power to BCE.

BCE has asked the federal government to intervene and direct to ``adhere to its existing policies'' and reconsider. The ruling can also be appealed to the Federal Court of Appeal.