AT&T profits from continuing operations $1.443 billion, or 90 cents a share.MIAMI--(BUSINESS WIRE)--APRIL 17, 1996--AT&T, excluding the financial results of operations the company intends to sell or spin off, today reported first-quarter net income of $1.443 billion or 90 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the . Comparable numbers for 1995 show income from continuing operations grew more than 14 percent from $1.265 billion. Earnings per share grew more than 12 percent from 80 cents per share. AT&T has reclassified prior financial results to conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" the current method of presentation. As previously reported, AT&T is required to reformat (1) To change the record layout of a file or database. (2) To initialize a disk over again. its results reporting to reflect the expected spin-off The situation that arises when a parent corporation organizes a subsidiary corporation, to which it transfers a portion of its assets in exchange for all of the subsidiary's capital stock, which is subsequently transferred to the parent corporation's shareholders. , sale or disposition of Lucent Technologies Inc., NCR Corporation (company) NCR Corporation - Electronics company mainly active in the midrange server market. NCR was founded 1884 as National Cash Register Company. It joint the computer industry in th 1950s. , and AT&T Capital Corporation (in accordance with Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ). Concurrent with the required change, the company also adopted a reporting format more appropriate for a communications services company. Earnings for the consolidated AT&T, including income from operations to be discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: , were $1.362 billion or 85 cents per share, compared with $1.198 billion or 76 cents per share in the year-ago quarter. In remarks to shareowners at the company's 111th annual shareowner share·own·er n. See shareholder. Noun 1. shareowner - someone who holds shares of stock in a corporation shareholder, stockholder investor - someone who commits capital in order to gain financial returns meeting here today at the James L. Knight Center James L. Knight Center is a 4,686-seat concert hall and theatre in Miami Florida. It is named in memory of James Landon Knight, the newspaper publisher whose businesses included The Miami Herald. It is part of the Miami Convention Center. in Miami, AT&T Chairman Robert E. Allen said: "Never have we held an annual meeting at a time of such fundamental and thrilling changes." "We're committed to harnessing the power of change and putting it to work for our customers," Allen said. "The new AT&T is focused on leading a market that will be unrecognizable from the market we lead today. It's a market where we'll offer customers a complete menu of communications and information services See Information Systems. , anytime, anywhere. That menu will include local and long distance. It will include wired and wireless. It will include on-line services, from Internet access See how to access the Internet. to a wide range of electronic commerce. It will even include TV programming and other forms of home entertainment." Allen highlighted the many milestones the company has already passed in entering new markets, including the successful launch of the AT&T WorldNet internet access offer and the DIRECTV alliance. "The new AT&T is emerging as a $50 billion a year company. We intend to make it a $100 billion a year company over the next 10 years. And perhaps more important, we intend to lead our industry in customer satisfaction, employee satisfaction and return to shareowners," Allen emphasized. "I'm proud of our accomplishments this quarter," Allen said. "In addition to the solid performance displayed by the new AT&T across some key measures, the speed and focus of so many to restructure, create and launch three new companies has been nothing less than remarkable." Revenue from continuing operations increased more than 4.6 percent to $12.956 billion, compared with $12.381 billion in the year-ago quarter. Solid increases in wireless and wireline revenue contributed to the growth. Communications services revenue increased $655 million or 5.5 percent from the same quarter last year. Communications services revenues include wireline services and wireless services, as well as products and other services. Wireline services revenue, which includes toll calling, network management, satellite services, messaging and other network enabled services, increased more than 5 percent to $11.313 billion. Long distance calling volumes grew 7.7 percent over the same period in 1995. The growth in long distance revenues came from U.S. business and consumer services Consumer Services refers to the formulation, deformulation, technical consulting and testing of most consumer products, such as food, herbs, beverages, vitamins, pharmaceuticals, cosmetics, hair products, household cleaners, [paints, plastics, metals, waxes, coatings, minerals, . The gap between revenue and volume growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. improved again this quarter. Wireless services revenues, which include cellular voice and data, messaging and air-to-ground, grew nearly 22 percent to $794 million. Total cellular service subscribers grew to 5.86 million, a 32 percent increase from a year ago. Products and other services revenues, which include data-networking, license and royalty revenue, consulting and outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. , submarine system product sales and wireless product sales, decreased 14.8 percent to $369 million. The decline was caused by the de-emphasis of wireless product sales by AT&T Wireless Services and a decrease in sales of submarine system products. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for communications services reached $2.325 billion, a 15.7 percent increase from the year-ago quarter. Operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: rose to more than 18.6 percent, an improvement of 1.6 percentage points over the same 1995 quarter. Financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. revenue decreased $80 million, primarily a result of AT&T Universal Card's program to securitize Securitize The practice of a company selling accounts receivables or other debts owed to it. The third party that buys the debt assumes ownership of it and the responsibility for collecting the debts, and keeps the repayments when made. its receivables. During the last five months of 1995, $3.5 billion of Universal Card's receivables were securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. . The unit's managed receivables, including those securitized, total $13.4 billion. Operating income for financial services was $49 million, a 27 percent decrease from the year-ago quarter. Operating margin fell to 10.4 percent, a drop of almost two percentage points. Total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. from continuing operations increased $278 million or 2.7 percent for the quarter, on an increase in revenue of $575 million or 4.6 percent. Operating income increased $297 million to $2.374 billion and the operating margin percentage improved to 18.3 percent from 16.8 percent a year ago. The loss from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. increased from $67 million in the year-ago quarter to $81 million this quarter. The loss from discontinued operations includes the net income or loss from Lucent Technologies, NCR (NCR Corporation, Dayton, OH, www.ncr.com) A technology company specializing in financial terminal transactions, retail systems and data warehousing. Until the late 1990s, NCR was heavily invested in the hardware side of the industry, known worldwide as a major manufacturer of computers and AT&T Capital. It also reflects eliminations of inter-company sales, taxes on a consolidated basis including a non-recurring benefit of $155 million, and an allocation of interest expense based upon the net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. of discontinued operations. The company cautioned that the net operating results from discontinued operations do not reflect the sum of these three companies on a stand-alone basis. AT&T said that it will continue in the near term to report NCR's results. However, information for NCR has been restated to reflect NCR as if it were a separate company. Both AT&T Capital and Lucent Technologies will issue their results separately in the near future. The company acknowledged that on a stand-alone basis AT&T Capital continues to be profitable, and that Lucent's loss is expected to be in the range disclosed in the prospectus for its recent initial public offering. NCR reported that total revenue, including sales to AT&T, Lucent and AT&T Capital, declined 13 percent to $1.586 billion from the year-ago quarter. This decrease reflects exiting the personal computer manufacturing business and the sale of NCR's Microelectronics microelectronics, branch of electronic technology devoted to the design and development of extremely small electronic devices that consume very little electric power. division. When these activities are excluded from both periods, revenues in the quarter grew by 3 percent. Demonstrating progress in its restructuring plan, gross margins as a percentage of revenue improved by 2.4 points. Expenses decreased 25.3 percent, or $150 million, from the year ago quarter, and declined 4.7 points as a percent of revenue. As a result, NCR reported an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $37 million, a substantial improvement from the restated $172 million loss in the year-ago period. Prior year's operating loss was restated to reflect NCR on a stand-alone basis. -0- NOTE TO FINANCIAL MEDIA: AT&T is holding a news conference in Miami with AT&T Chairman Bob Allen
Bob Allen (born 1958) is an American politician who has been a Republican member of the Florida House of Representatives since 2000, representing Florida's 32nd district. at 8:30 a.m. Eastern time. Reporters not attending the news conference can listen by dialing 800-611-1147. Reporters calling from outside the U.S. should dial 612-288-0318. Continuous rebroadcasts will begin at 11:00 a.m. and can be heard by calling 800-475-6701 and entering access code 303175. International callers should dial 612-365-3844, access code 303175, for the rebroadcast. At 8:45 a.m. Eastern time, AT&T Chief Financial Officer Rick Miller will provide additional information on earnings results on a one-way conference call. The dial-in number is 800-260-0702. International callers should dial 612-288-0337. Continuous rebroadcasts of that call will begin at 10:00 a.m. and can be heard by calling 800-475-6701 and entering the access code 302721. International callers should dial 612-365-3844, access code 302721, for the rebroadcast. -0-
AT&T
Consolidated Statements of Income
(Preliminary and Unaudited)
For the Three
Months Ended
Dollars in Millions March 31,
(except per share amounts) 1996 1995
Sales and Revenues Communications services.............. $12,476 $11,821 Financial services................... 480 560 Total Revenues......................... 12,956 12,381
Operating Expenses
Access and other
interconnection costs.............. 4,168 4,453
Network and other communications..... 1,953 1,784
Depreciation and amortization........ 665 620
Selling, general and administrative.. 3,365 2,956
Total communications services........ 10,151 9,813
Financial services and leasing....... 431 491
Total Operating Expenses............... 10,582 10,304
Operating Income....................... 2,374 2,077 Other income - net..................... 102 43 Interest expense....................... 123 104 Income from continuing operations before income taxes.................. 2,353 2,016 Provision for income taxes............. 910 751 Income from continuing operations...... 1,443 1,265 Loss from discontinued operations (net of tax benefits of $300 in 1996 and $24 in 1995)........ (81) (67) Net income ............................ $ 1,362 $ 1,198 Weighted average common shares outstanding (millions) 1,608 1,580 Per Common Share: Income from Continuing Operations...... $ 0.90 $ 0.80 Loss from Discontinued Operations...... $ (0.05) $ (0.04) Net Income............................. $ 0.85 $ 0.76 Dividends declared per common share $ 0.33 $ 0.33 -0-
AT&T
Consolidated Statement of Income
Footnotes
(a) On September 20, 1995 AT&T Corp. announced a plan, subject
to certain conditions, to separate into three independent, publicly
held, global companies: communications services (which will retain
the AT&T name), communications systems and technologies (which has
been named Lucent Technologies Inc.) and transaction-intensive
computing (formerly AT&T Global Information Solutions Company, now
NCR Corporation). Also announced as part of the plan was the
Company's intent to pursue the sale of its remaining 86 percent
interest in AT&T Capital Corporation.
Pursuant to Accounting Principles Board Opinion No. 30
"Reporting the Results of Operations - Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions", the Consolidated
Financial Statements of AT&T have been restated to reflect the
probable dispositions of Lucent, NCR and AT&T Capital. Accordingly,
the revenues, costs and expenses of Lucent, NCR and AT&T Capital have
been excluded from the respective captions in the Consolidated
Statements of Income. The net operating results of these entities
have been reported, net of applicable income taxes, as "Income (loss)
from discontinued operations". In addition, the consolidated results
for continuing operations have been reclassified to reflect the
results of the new business and to improve comparability with the
communications services industry.
CONTACT: Eileen M. Connolly and Jim Byrnes Jim Byrnes may refer to:
At Miami's James L. Knight Center: 305/416-5920 or Eileen M. Connolly or Jim Byrnes 908/221-6731 (office) 908/221-7876 (office) 914/361-4615 (home) 908/689-6040 (home) |
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