Sprint has higher earnings on strong wireless sales
Thursday, July 22, 2004
KANSAS CITY, Mo. -- Sprint Corp. on Wednesday reported higher second-quarter earnings driven by strong wireless sales.
The Overland Park, Kan.-based company, which combined its PCS and FON tracking stocks in April, also increased its earnings guidance for the year.
"Sprint continues to successfully execute its transformation agenda," said Gary Forsee, Sprint chairman and CEO, in a statement. "We achieved revenue growth in the second quarter that will likely lead other integrated telecom players."
For the April through June period, Sprint reported earnings of $233 million, or 16 cents per share, compared to $7 million during the quarter last year.
The earnings included one-time charges for layoffs and a final payment in a bankruptcy settlement with MCI.
Without the charges, earnings were $300 million, or 20 cents per share, compared with $238 million, or 17 cents per share, last year. Analysts surveyed by Thomson First Call had expected earnings of 19 cents per share.
Revenues increased to $6.9 billion, or 6 percent higher than the $6.5 billion reported during the same period last year.
Wireless, which serves 22 million customers, continued to take over as Sprint's key business sector, reporting a 17 percent increase in revenue to $3.6 billion and a 48 percent increase in income. The company added 897,000 PCS customers and slightly increased revenue to $62 per user.
The percentage of customers dropping service shrunk to 2.3 percent, compared to 2.4 percent last year.
Company officials told analysts they expect the continued growth in wireless and raised guidance for the year to between 74 cents and 78 cents per share. Earlier the company had expected annual earnings of between 70 cents and 75 cents per share.
Sprint's traditional local phone business was steady, reporting adjusted income of $447 million compared to $461 million in the second quarter of 2003. Revenue was flat at $1.5 billion. While the company said it lost 192,000 voice lines, it signed up 160,000 DSL high-speed Internet lines.
Long-distance continued to struggle, which officials blamed on stiff competition and price cuts across the industry. The business sector reported a $139 million loss in the quarter as revenues declined 6.6 percent.
Sprint stock rose 28 cents to close at $18.30 Wednesday on the New York Stock Exchange.
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