UPDATE 1-Canada's BCE profit grows 6 pct; affirms 2014 outlook

Thu Aug 7, 2014 7:11am EDT

(Adds detail on wireless operations, Bell Aliant bid)

TORONTO Aug 7 (Reuters) - BCE Inc , Canada's largest telecom company, posted a 6 percent increase in second-quarter profit, driven by higher advertising and subscriber fee revenue from its acquisition of TV and radio content producer Astral Media.

BCE, which operates under the Bell brand, added 66,186 net contract wireless subscribers in the period, compared to 96,390 in the same quarter a year ago, a decline BCE said was due to the elimination of three-year phone contracts as mandated by a new wireless code of conduct.

Such post-paid customers are coveted because they sign multi-year contracts and pay more each month than prepaid subscribers.

Wireless market leader Rogers Communications said last month that it added just 38,000 such customers in the same period, but that its average wireless customer paid more.

Bell's average wireless customer - a blend of contract and prepaid accounts - paid C$59.49 a month for service, a 4.6 percent increase from a year ago.

Net income attributable to shareholders rose to C$606 million ($554.64 million), or 78 Canadian cents per share, in the second quarter, from C$571 million, or 74 Canadian cents per share, a year earlier.

On an adjusted basis, earnings were 82 Canadian cents per share. Operating revenue rose 4.4 percent to C$5.22 billion.

Analysts had on average expected earnings of 84 Canadian cents a share on revenue of C$5.19 billion, according to Thomson Reuters I/B/E/S.

BCE reaffirmed its earnings outlook for 2014.

BCE, which recently offered to buy the 56 percent of regional affiliate Bell Aliant it doesn't already own, said it received approval from a competition watchdog for the bid on Aug. 5 and it should close by the end of November pending a majority of minority shareholders tendering their shares.

BCE accounted for Bell Aliant operations in its report.

(1 US dollar = 1.0926 Canadian dollar) (Reporting by Alastair Sharp in Toronto and Ashutosh Pandey in Bangalore; Editing by Saumyadeb Chakrabarty and Bernadette Baum)