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Bruce Telecom loses financial officer |
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 Bruce Telecom chief financial officer Laurel Stein (L) and president and chief executive officer Eric Dobson speak to council Bruce Telecom is searching for a new chief financial officer after Laurel Stein tendered her resignation. She told Kincardine council last night (Feb. 3) that she will continue until April and then she is returning to Vancouver to be closer to family. Stein was hired in August, 2009, taking over from Bill Sipprell who had retired. She and Eric Dobson, new president and chief executive officer, were on hand at the committee-of-the-whole portion of the council meeting to present the 2010 operating and capital budget for the independent telephone company. Stein said significant regulatory changes are on hold while the Canadian Radio-television and Telecommunications Commission (CRTC) devises its new framework. That is expected by this fall. In addition, revenues and subsidies have been frozen at 2009 rates, she said. Plus, Bell's application for increased lease rates has been put on hold by the CRTC. Those increases would have meant double the cost for Bruce Telecom to use Bell's network in other areas, said Stein. Meanwhile, she said Bruce Telecom experienced lower income than what she showed council in the fall. What was anticipated as $1.5 million net income turned into $723,000. "In the TV production, we took about $90,000 in losses in the sale of that inventory," she said, noting that the total loss is expected to be about $400,000. The Internet business also had lower growth than anticipated, she said. On a positive note, the long-distance revenue was better, and the local telephone revenue is holding steady, said Stein.
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For 2010, she expects Bruce Telecom to stave off the competition in regulated products. The long-distance rate per minute is going down, so even though there are increased minutes, at the lower rate there will be a decrease in overall revenue, she said. The new Bruce Mobility cellular product is to be launched this year which will increase revenue, she added. Under the operating side, she said the management and board of directors have agreed to take a three-per-cent cut in wages. That pay cut is also in front of the union members. "We're looking for ways to reduce costs, find savings, and run more efficiently," she said, "and we're not done looking."Other operating expenses have been reduced from 2009, including sales and marketing, commercial advertising, and corporate sponsorships. Dobson said it was quite clear when he came on-board Dec. 18 (taking over from Mike Andrews) that the profitability of Bruce Telecom was headed in the wrong direction. "So, we've made some changes, beginning with salary cuts for the management and board of directors," he said. "We are doing what we can without affecting the overall business. Over the long-term, there are things we can do to grow the business." He said the budget reflects the company's intent to bring stability to the financial results, restore profitability, and put Bruce Telecom back on the path of reinvesting in the company. The $2.3-million capital budget includes basic projects:
Based on the current year performance, the dividend for the Municipality of Kincardine is $720,000 for 2009, said Dobson. If Bruce Telecom achieves its 2010 budget, the dividend should be $910,000, he said, but the company recommends a distribution of $800,000 in four quarterly installments. This allows management and board to have sufficient cash flow to reinvest $1.5 million in the company Council accepted the presentation. "Congratulations on a job well done," said councillor Ron Hewitt.
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