CenturyTel Announces Successful Repositioning of the Company and Strong Third Quarter Results.Business Editors NOTE TO MEDIA: Multimedia assets available MONROE, La.--(BUSINESS WIRE)--Oct. 24, 2002 CenturyTel, Inc. (NYSE NYSE See: New York Stock Exchange :CTL See control key. 1. CTL - Checkout Test language. 2. CTL - Compiler Target Language. 3. CTL - Computational Tree Logic ) announces operating results for third quarter 2002, which reflect recently completed acquisitions.
-- Revenues from continuing operations, excluding nonrecurring items, increased 25.5% to $532.1 million.
-- Earnings from continuing operations before interest, taxes, depreciation and amortization (EBITDA), excluding nonrecurring items, rose 28.6% to $272.3 million.
-- Income from continuing operations, excluding nonrecurring items, climbed 53.5% to $68.6 million.
-- Diluted earnings per share, excluding nonrecurring items, increased to $.57.
-- Free cash flow, excluding nonrecurring items, was $82.3 million.
Third Quarter Highlights
(Excluding nonrecurring items)
(In thousands, except per Quarter Ended Quarter Ended
share and customer amounts) 09/30/02 09/30/01 % Change
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Revenues from continuing
operations $ 532,142 $ 423,973 25.5%
EBITDA from continuing
operations (1) $ 272,302 $ 211,713 28.6%
Income from continuing
operations (1) $ 68,588 $ 44,682 (2) 53.5%
Net Income $ 81,093 $ 77,863 (2) 4.1%
Diluted Earnings Per Share
from continuing operations (1) $ .48 $ .31 (2) 54.8%
Diluted Earnings Per Share $ .57 $ .55 (2) 3.6%
Average Diluted Shares
Outstanding 142,770 142,260 0.4%
Telephone Revenues $ 468,580 $ 377,747 24.0%
Other Operations Revenues $ 63,562 $ 46,226 37.5%
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Telephone Access Lines 2,437,744 1,808,574 34.8%
Long Distance Customers 584,890 438,669 33.3%
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(1) Includes corporate overheads previously allocated to
discontinued operations.
(2) As adjusted to reflect the after-tax effect of eliminating
goodwill amortization in accordance with SFAS 142.
"During the third quarter CenturyTel completed the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of its wireless business and the acquisitions of the Verizon properties in Alabama and Missouri, repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. the Company as a leading pure-play rural local exchange carrier," Glen F. Post, III, chairman and chief executive officer, said. "We achieved a solid 24.0% growth in Telephone Revenues reflecting the contribution from the acquired properties and a strong 37.5% growth in Other Operations Revenues, primarily due to the continued growth in long distance and Internet customers." Consolidated revenues 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 , excluding nonrecurring items, for the third quarter rose 25.5% to $532.1 million from $424.0 million. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become from continuing operations, excluding nonrecurring items, grew to $272.3 million from $211.7 million. The Company achieved a consolidated EBITDA margin of 51.2% during the quarter. Income from continuing operations for the quarter, excluding nonrecurring items, increased 53.5% to $68.6 million from $44.7 million in third quarter 2001 (as adjusted). Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of from continuing operations, excluding nonrecurring items, increased 54.8% to $.48 from $.31 (as adjusted). Diluted earnings per share, excluding nonrecurring items, increased 3.6% to $.57 from $.55 (as adjusted). Telephone revenues, excluding nonrecurring items, grew 24.0% to $468.6 million during the quarter, compared with $377.7 million in third quarter 2001. The Alabama and Missouri properties acquired from Verizon contributed $85.6 million of the increase. The remaining increase resulted primarily from growth in vertical services and interstate revenues that more than offset declines in intrastate access and toll revenues. Telephone 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. increased primarily due to the acquisitions, higher employee-related costs and depreciation expenses that were offset by reductions in retail bad debt and access expenses. Telephone 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. , excluding nonrecurring items, increased 28.5% to $152.3 million from $118.5 million (as adjusted), and telephone EBITDA, excluding nonrecurring items, rose 25.4% to $256.6 million from $204.7 million a year ago. CenturyTel's third quarter telephone EBITDA margin was 54.8% while the operating income margin was 32.5%. Other Operations revenues grew 37.5% to $63.6 million during third quarter 2002, compared with $46.2 million in third quarter 2001. CenturyTel's long distance revenues increased $8.5 million, or 27.5%, to $39.6 million. CenturyTel now serves more than 584,000 long distance customers. Internet revenues increased 42.0% to $15.0 million in third quarter 2002 from $10.6 million in third quarter 2001. The Internet business generated operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. of $1.2 million for the quarter compared to operating cash flow of $319,000 for the third quarter 2001. CenturyTel CLEC (Competitive Local Exchange Carrier) An organization offering local telephone service that is not one of the traditional telephone companies. The Telecommunications Act of 1996 allowed competition to the incumbent telcos (ILECs), enabling new companies (CLECs) revenues increased by $4.4 million, of which $3.9 million resulted from the acquisition of CLEC assets in February, 2002. "We added over 6,800 DSL connections DSL connection n (Comput) → DSL-Anschluss m and more than 48,000 long distance customers during the quarter. These results represent the second strongest quarter for DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary and long distance customer net additions in the Company's history," Post said. For third quarter 2002, 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 (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), the Company reported net income of $607.7 million, or $4.26 per diluted share, compared to net income of $106.3 million (as adjusted), or $.75 per diluted share in third quarter 2001. Third quarter 2002 reflects a $551.4 million after-tax gain on the sale of our wireless operations. See the accompanying financial information for additional nonrecurring items that affected the third quarters and first nine months of 2002 and 2001. For the first nine months of 2002, income from continuing operations, excluding nonrecurring items, increased 29.9% to $160.9 million from $123.9 million in 2001 (as adjusted) and diluted earnings per share from continuing operations increased 29.9% to $1.13 from $.87 (as adjusted). Consolidated revenues, excluding nonrecurring items, increased 12.0% to $1.394 billion from $1.245 billion while EBITDA was $705.3 million compared to $620.9 million a year ago, a 13.6% increase. The Company continued to reflect its wireless business as discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. during the quarter. As a result of this treatment, depreciation expense for the wireless operations was discontinued effective March 19, 2002, the date of the definitive agreement. This discontinuation dis·con·tin·u·a·tion n. A cessation; a discontinuance. Noun 1. discontinuation - the act of discontinuing or breaking off; an interruption (temporary or permanent) discontinuance of wireless depreciation contributed approximately $.02 to earnings per share for third quarter 2002 and $.08 from March 19, 2002, to the sale effective date of August 1, 2002. Income from continuing operations includes total interest expense and also includes corporate overheads previously absorbed by the Company's wireless operations of $1.3 million for third quarter 2002 and $11.3 million for the nine months ended September 30, 2002. For the fourth quarter 2002, CenturyTel expects revenue from continuing operations to be $560 to $575 million. Operating cash flow from continuing operations is expected to be $285 to $295 million. Total diluted earnings per share is anticipated to be $.51 to $.55 for fourth quarter 2002. For the full year 2002, the Company expects total diluted earnings per share to be $2.19 to $2.23. These estimates exclude nonrecurring items and the expected $38.1 million after-tax charge associated with the redemption on October 15, 2002, of the Company's $400 million Series I remarketable senior notes. In addition to historical information, this release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , estimates and projections that are based on current expectations only, and are subject to a number of risks, uncertainties and assumptions, many of which are beyond the control of CenturyTel. Actual events and results may differ materially from those anticipated, estimated or projected if one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect. Factors that could affect actual results include but are not limited to: the Company's ability to effectively manage its growth, including successfully integrating newly acquired businesses into its operations, hiring adequate numbers of qualified staff and successfully upgrading its billing and other information systems; the inherent risk of rapid technological change; the effects of on-going changes in the regulation of the Company or the communications industry communications industry, broadly defined, the business of conveying information. Although communication by means of symbols and gestures dates to the beginning of human history, the term generally refers to mass communications. generally; the effects of greater than anticipated competition in the Company's markets; possible changes in the demand for, or pricing of, the Company's products and services; the Company's ability to successfully introduce new offerings on a timely and cost-effective basis; higher than anticipated interest rates; the Company's ability to collect its receivables from financially troubled communications companies; and the effects of more general factors such as changes in overall market or economic conditions or in legislation, regulation or public policy. These and other uncertainties related to the Company's business are described in greater detail in the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2001. The information contained in this release is as of October 24, 2002. The Company undertakes no obligation to update or revise any of this information whether as a result of new information, future events or developments, or otherwise. CenturyTel's management will host a conference call at 10:30 A.M. Central time today. Interested parties can access the call by dialing 800/729-6845 and the call will be accessible for replay by calling 800/642-1687 and entering the conference-id number: 5972009. Investors can also listen to CenturyTel's earnings conference call and replay by accessing the Company's Web site at www.centurytel.com CenturyTel, Inc. provides communications services including local exchange, long distance, Internet access See how to access the Internet. and data services to more than three million customers in 22 states. The company, headquartered in Monroe, Louisiana The city of Monroe is the parish seat of Ouachita Parish, in the US state of Louisiana. [1] [2] It is the principal city of the Monroe, Louisiana Metropolitan Statistical Area (pop. , is publicly traded on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the symbol CTL. CenturyTel is the 8th largest local exchange telephone company, based on access lines, in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Visit CenturyTel's corporate Web site at www.centurytel.com Note: Financial statements are available at URL URL in full Uniform Resource Locator Address of a resource on the Internet. The resource can be any type of file stored on a server, such as a Web page, a text file, a graphics file, or an application program. : http://www.businesswire.com/cgi-bin/photoblob.sh?pw.102402/bb1 |
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