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CELLULAR COMMUNICATIONS, INC. ANNOUNCES OPERATING RESULTS FOR FIRST QUARTER 1993

 NEW YORK, May 14 /PRNewswire/ -- Cellular Communications, Inc. (NASDAQ: COMMA) ("CCI") announced today its operating results for the three months ended March 31, 1993.
 On Aug. 1, 1991, CCI and PacTel Corporation ("PacTel") formed a joint venture equally owned by CCI and PacTel comprised of CCI's cellular telephone interests in Ohio and PacTel's cellular telephone interests in Michigan and Ohio.
 The following summarizes the results of the joint venture for the three months ended March 31, 1993 and 1992:
 CCI/PACTEL JOINT VENTURE
 (In thousands, except subscribers)
 Three Months Ended March 31, 1993 1992
 Revenues:
 Service $ 82,234 $ 68,328
 Equipment, net 4,408 3,029
 Total revenues 86,642 71,357
 Expense:
 Operating 19,755 15,300
 SG&A 30,446 29,102
 Total expense 50,201 44,402
 Operating income 36,441 26,955
 Depreciation and amortization (18,719) (14,241)
 Interest and other, net 334 (75)
 Net income $ 18,056 $ 12,639
 Ending subscribers 384,000 303,000
 Discussion of Joint Venture First Quarter Results
 Service revenue increased to $82,234,000 from $68,328,000 as a result of subscriber growth.
 The income from telephone equipment (before depreciation of rental telephones) increased to $4,408,000 from $3,029,000 because of increased telephone rental income.
 Operating expenses increased to $19,755,000 from $15,300,000 primarily because of increases in subscriber activity and property taxes.
 Selling, general and administrative expenses increased to $30,446,000 from $29,102,000, but declined as a percentage of service revenue to 37 percent from 42.6 percent. The decline in percentage terms is due to the conversion of the Michigan billing system from an outside provider to internal operations and a decline in the selling costs per new activation, while the increase in absolute costs is due to the growing emphasis on direct sales and support through company-owned sales and service centers.
 Depreciation and amortization increased to $18,719,000 from $14,241,000 due to the depreciation of additional cellular network equipment and rented telephones.
 Interest and other, net changed to $334,000 from $(75,000) because 1992 includes a $220,000 loss on disposals of equipment and 1993 includes $156,000 of income from disposals of equipment. Net interest income was $252,000 and $216,000 in 1993 and 1992, respectively.
 CCI Results
 On Feb. 28, 1992, CCI distributed the shares of its wholly-owned subsidiary Cellular Communications of Puerto Rico, Inc. ("CCPR") to its shareholders. Therefore, CCPR was included in CCI's consolidated results of operations through February 1992. The service revenue, net telephone equipment revenue and operating expenses in 1992 is from the operations of CCPR. In addition, $1,436,000 of the selling, general and administrative expenses, $1,328,000 of the depreciation and amortization expense and $99,000 of interest income included in net interest expense in 1992 is from the operations of CCPR.
 CELLULAR COMMUNICATIONS, INC.
 (In thousands, except per share data)
 Three Months Ended March 31, 1993 1992
 Revenues:
 Equity in net income of joint venture $ 9,390 $ 6,682
 Service -- 1,293
 Management fees 14 168
 Equipment, net -- 41
 Total revenues 9,404 8,184
 Expenses:
 Operating -- 572
 SG&A 3,940 5,475
 Total expenses 3,940 6,047
 Operating income 5,464 2,137
 Depreciation and amortization (575) (1,938)
 Net interest (expense) (3,032) (3,724)
 Nonrecurring charges -- (507)
 Income (loss) before income taxes and
 cumulative effect of accounting change 1,857 (4,032)
 Provision for income taxes (169) --
 Income (loss) before cumulative effect of
 accounting changes 1,238 (4,032)
 Cumulative effect of change in accounting
 for income taxes 8,000 --
 Net income (loss) $9,238 $(4,032)
 Net income (loss) per common share (A):
 Income (loss) before cumulative effect
 of accounting change $.03 $(.11)
 Cumulative effect of change in accounting
 for income taxes .18 --
 Net income (loss) $.21 $(.11)
 Weighted average shares 43,849 42,050
 NOTE: (A) The net income (loss) per share is calculated after deducting the accrued dividend requirements on CCI's redeemable preferred stock of $35,000 and $525,000 for the three months ended March 31, 1993 and 1992, respectively, from the net income for the period.
 Discussion of CCI First Quarter Results
 Equity in net income of joint venture increased to $9,390,000 from $6,682,000 because of the increase in the net income of the joint venture.
 Management fees for the management of certain RSA markets on behalf of the owners (and subject to their direction and control) decreased to $14,000 from $168,000 because the company earned $156,000 from construction management in 1992 whereas these RSA's had no construction in 1993.
 Selling, general and administrative expenses (excluding $1,436,000 in 1992 from CCPR) decreased to $3,940,000 from $4,039,000. Included in the 1993 and 1992 amounts are $2,700,000 and $2,653,000, respectively, related to the changes in the stock option agreements pursuant to the merger agreement.
 Depreciation and amortization (excluding $1,328,000 in 1992 from CCPR) decreased to $575,000 from $610,000. Included in the 1992 amount was $57,000 of license acquisition cost amortization for the Clinton, Ohio cellular license which was sold to the joint venture in July 1992.
 Net interest expense (excluding $99,000 in 1992 from CCPR) decreased to $3,032,000 from $3,823,000 primarily because the effective rate on the bank loan was lower in 1993.
 The company incurred $507,000 of special legal, accounting and financial advisory fees relative to the merger agreement in 1992.
 The company adopted Financial Accounting Standards Board Statement No. 109, "Accounting for Income Taxes," effective Jan. 1, 1993. As permitted by Statement 109, the company has elected not to restate the financial statements of any prior years. The effect of the change on pretax income from operations for the three months ended March 31, 1993 was not material; however, the cumulative effect of the change increased net income by $8,000,000 or $.18 per share.
 -0- 5/14/93
 /CONTACT: J. Barclay Knapp, chief operating officer, 212-906-8445, or Stanton N. Williams, director - corporate development, 212-906-8448, or Richard J. Lubasch, vice president - general counsel, 212-906-8470, all of Cellular Communications, Inc./
 (COMMA)


CO: Cellular Communications, Inc. ST: New York IN: TLS SU: ERN

LD -- NY005 -- 8481 05/14/93 09:05 EDT
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Date:May 14, 1993
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