Printer Friendly

AT&T REPORTS RECORD NET INCOME FOR QUARTER

 AT&T REPORTS RECORD NET INCOME FOR QUARTER
 NEW YORK, July 16 /PRNewswire/ -- AT&T (NYSE: T) today reported


record quarterly net income of $961 million, or 72 cents per share.
 This compares with the previous record in the 1991 second quarter, when profits of $928 million, or 72 cents a share, included an after-tax gain of $87 million, or 7 cents a share, from the sale of stock AT&T held in Sun Microsystems, Inc. Earnings per share were unchanged because AT&T now has more shares outstanding.
 Solid growth in telecommunications and financial services boosted second-quarter revenues to $15.845 billion compared with $15.724 billion for the 1991 period. Operating income rose 4.5 percent to $1.518 billion, compared with $1.454 billion a year ago.
 "We continued to show growth in a still-sluggish economy," said AT&T Chairman Robert E. Allen. "Equipment sales are not what we'd like, but they tend to lag economic upturns. We still expect sales of our products to improve later in the year."
 For the first six months of 1992, the communications and computer company's net income was $1.844 billion, or $1.39 a share on revenues of $31.220 billion. A year ago, net income was $1.686 billion, or $1.31 a share ($1.24 adjusted for the sale of the Sun stock) on revenues of $30.998 billion.
 Quarterly Results in Brief
 -- Telecommunications services revenues grew $215 million or 2.2 percent, as long-distance calling volumes rose more than 6 percent.
 -- AT&T Universal Card Services, the third-largest credit card issuer in just over two years since being introduced, recorded its first profitable month in June, well ahead of schedule. The card's growth was a major contributor to the 43-percent jump in financial-services revenues.
 -- NCR continues to contribute to AT&T's profits and saw strong orders despite difficult economic conditions in some overseas markets.
 -- Overall product and systems revenues declined, despite higher revenues for microelectronic components; phone systems for small businesses; fiber-optic and copper cables for communications-services providers, and undersea-cable systems. Rentals and other services were down slightly from a year ago.
 Results in Detail
 TELECOMMUNICATIONS SERVICES: Gains in business services, especially toll-free 800 and WATS-type calling, led the growth in long-distance volumes and revenues. Residential and international services saw healthy, but lesser, increases.
 AT&T said it still believes it is maintaining market share in the face of intense competition.
 PRODUCTS AND SYSTEMS: Revenues declined 5 percent overall from the 1991 second quarter. Revenues from sales of consumer products and phone systems for large business customers were flat year over year.
 Network telecommunications products and systems overseas sales were up for the quarter, but sales overall declined as customers in the United States deferred purchases.
 At NCR, total revenues -- including computer product sales, services, rentals and revenues from other sources -- were $1.750 billion for the quarter.
 NCR's operating income of $98 million improved from the first quarter, when expenses related to the February merger with Teradata Corp. were recorded. NCR continues to report strong orders, particularly in the United States.
 (NOTE: NCR results now include portions of AT&T's former computer business, Teradata and sales to other AT&T units. Therefore, current figures are not comparable to the pre-merger 1991 NCR financial results.)
 FINANCIAL SERVICES: With the Universal Card leading the way and a substantial contribution from AT&T Capital Corporation, this category posted $425 million in revenues compared with $298 million a year ago.
 RENTALS AND OTHER SERVICES: Revenues declined 1.1 percent, as strong growth of other services, such as ISTEL, nearly offset a continued and expected decline in rentals of telephones and other communications equipment.
 COSTS AND EXPENSES: Total costs decreased $41 million, largely as a result of decreases in access and other interconnection costs. Total operating expenses increased $98 million, due mainly to higher selling, general and administrative expenses.
 At the end of the second quarter, AT&T's total workforce was 315,300.
 AT&T
 Consolidated Statements of Income
 (Dollars in millions except per share amounts)
 (Preliminary and unaudited)
 Periods ended Three Months Six Months
 June 30 1992(A) 1991(B) 1992(A) 1991(B)
,842 4,042 7,294 7,728
 Rentals and other services 1,727 1,748 3,370 3,468
 Financial services and leasing 425 298 832 606
 TOTAL REVENUES 15,845 15,724 31,220 30,998
 COSTS
 Telecommunications services:
 Access and other inter-
 connection costs(C) 4,486 4,624 9,142 9,312
 Other costs 1,707 1,697 3,454 3,460
 Total telecommunications svcs. 6,193 6,321 12,596 12,772
 Products and systems 2,296 2,242 4,277 4,228
 Rentals and other services 792 846 1,521 1,646
 Financial services and leasing 315 228 599 498
 TOTAL COSTS 9,596 9,637 18,993 19,144
 GROSS MARGIN 6,249 6,087 12,227 11,854
 OPERATING EXPENSES
 Selling, general and
 administrative expenses 4,027 3,802 7,830 7,494
 Research and development exps. 694 817 1,398 1,528
 Provision for business
 restructuring 10 14 39 63
 TOTAL OPERATING EXPENSES 4,731 4,633 9,267 9,085
 OPERATING INCOME 1,518 1,454 2,960 2,769
 Other income-net(D)(E) 117 230 258 325
 Interest expense 160 213 363 431
 INCOME BEFORE INCOME TAXES 1,475 1,471 2,855 2,663
 Provision for income taxes 514 543 1,011 977
 NET INCOME $ 961 $ 928 1,844 1,686
 Earnings per share $ .72 $ .72 $ 1.39 $ 1.31
 Average shares (millions) 1,332 1,286 1,325 1,284
 Dividends declared per share $ .33 $ .33 $ .66 $ .66
 (A) -- On Feb. 28, 1992, AT&T merged with Teradata Corporation. As a result, AT&T issued approximately 11 million shares of common stock in exchange for the outstanding shares of Teradata not previously owned by AT&T. The merger was accounted for as a pooling of interests; however, the consolidated financial statements of AT&T were not restated due to immateriality. The results of operations for Teradata are included in the consolidated statements of income beginning Jan. 1, 1992, and are not material to AT&T's results.
 (B) -- In September 1991, AT&T merged with NCR Corporation. The merger was accounted for as a pooling of interests; accordingly, the financial statements of AT&T have been restated for all periods prior to the merger to include NCR.
 (C) -- Effective Dec. 31, 1991, AT&T reclassified access and other interconnection costs to cost of telecommunications services to provide a clearer and more typical display of revenues and costs. These costs were previously reported as direct reductions in telecommunications services revenues. This change in presentation had no effect on AT&T's gross margin, operating income or net income. Previously reported revenues and costs were restated in the new format.
 (D) -- In June 1991, AT&T realized a pre-tax gain of approximately $140 ($87, or $.07 per share after taxes) on the sale of a portion of its equity interest in Sun Microsystems, Inc.
 (E) -- In March 1991, AT&T recognized a pre-tax gain of $43 ($.03 per share after taxes) from the sale of equity interests in a subsidiary, UNIX System Laboratories, Inc.
 -0- 7/16/92
 /NOTE TO EDITORS: Alex J. Mandl, AT&T's chief financial officer, will discuss the company's second-quarter performance in a conference call for reporters and financial analysts at 11 a.m. EDT today. The call may be accessed by dialing either 1-800-772-1024 or 1-800-225-1168. The call will be rebroadcast over the same numbers at 2 p.m. and 4 p.m. EDT today./
 /CONTACT: Jim Byrnes, 908-221-4011, or home, 908-689-6040, or Dick Gray, 908-221-5057, or home, 908-232-3706, both of AT&T/
 (T) CO: AT&T ST: New Jersey IN: TLS SU: ERN


GK -- NY009 -- 9855 07/16/92 08:35 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Jul 16, 1992
Words:1311
Previous Article:GREAT WESTERN REPORTS SECOND QUARTER EARNINGS
Next Article:ELAN AND WARNER LAMBERT UNIT FORM JOINT VENTURE MARKETING COMPANY IN U.K.
Topics:


Related Articles
COGNITRONICS REPORTS THIRD QUARTER EARNINGS FROM OPERATIONS EQUAL TO 4 CENTS VS. 10 CENTS BUT SEES STRONG FOURTH QUARTER
NEW VALLEY REPORTS RESULTS FOR 1991 AND FOURTH QUARTER
AMERICAN INDEMNITY FINANCIAL DECLARES REGULAR DIVIDEND AND REPORTS FIRST QUARTER 1992 RESULTS
HENLEY INTERNATIONAL REPORTS RECORD SECOND QUARTER AND SIX MONTH RESULTS
WHITMAN REPORTS EARNINGS
FOREST LABORATORIES REPORTS FISCAL FIRST QUARTER RESULTS
FORSCHNER GROUP REPORTS RECORD SALES AND NET INCOME FOR SECOND QUARTER
SPECTRAN REPORTS IMPROVED RESULTS FOR THE SECOND QUARTER AND SIX MONTHS
VIDEO LOTTERY TECHNOLOGIES REPORTS RECORD REVENUES AND NET INCOME FOR THE SECOND QUARTER, FIRST HALF OF 1992
ADAGE REPORTS RECORD SALES FOR SECOND QUARTER AND SIX MONTHS

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters