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CONTEL CELLULAR REPORTS THIRD QUARTER AND YEAR-TO-DATE RESULTS FOR 1992

CONTEL CELLULAR REPORTS THIRD QUARTER AND YEAR-TO-DATE RESULTS FOR 1992
 ATLANTA, Oct. 26 /PRNewswire/ -- Contel Cellular Inc. (NASDAQ: CCXLA) today reported a net loss for the quarter and nine months ended Sept. 30 of $25.4 million and $82.4 million, respectively, or 25 cents per share and 82 cents per share, compared with $25.1 million and $95.3 million, or 25 cents and 95 cents per share for the corresponding 1991 periods.
 Third quarter revenues increased 18 percent to $74.2 million, compared with $62.7 million reported in 1991. Subscribers increased by 19,500, or an annual rate of 29 percent, and totaled almost 291,000 at Sept. 30. Operating cash flow (operating income before depreciation and amortization) was $15.3 million, as compared to $11.8 million for the corresponding 1991 period.
 Contel Cellular President and Chief Executive Officer Dennis Whipple noted, "The third quarter, which has historically been seasonally low for subscriber gains and usage, showed signs of improvement in spite of persistent recessional pressures throughout our markets."
 With respect to subscriber additions, Whipple added: "Net subscriber gains of 19,500 were the highest of any quarter this year and 37 percent more than the corresponding 1991 quarter. In addition, the third quarter results reflect continued progress in our efforts to reduce customer acquisition costs as new programs are implemented and new distribution channels mature."
 Third Quarter Results Reviewed
 Total revenues were $74.2 million, 19 percent higher than the $62.7 million reported for the prior year. Service revenues, which exclude equipment sales, increased 20 percent to $68.3 million, as compared to $56.8 million reported in 1991. The increase in service revenues is attributed to the increase in subscribers partially offset by lower usage per subscriber. Average monthly service revenue per subscriber declined to $81, compared with $95 for the same period in 1991. The decline in usage per subscriber from 1991 is a result of the continuing recession and increased number of casual users, consistent with industry trends. Average monthly churn is 2.3 percent, as compared with almost 2.5 percent for the corresponding period in 1991.
 Operating loss for the third quarter of $8.0 million decreased from the $20.6 million for the corresponding 1991 period. The 1992 decreased loss is due to the increase in revenues, and the decrease in amortization expenses, partially offset by increased selling, general and administrative expenses. The 1991 third quarter reflects the impact of the election made to step up the tax basis of the Southeast properties which were acquired in February 1990. The election was recorded retroactively to the date of the acquisition and increased amortization expenses and operating loss for the third 1991 quarter.
 Net loss of $25.4 million for the quarter was essentially the same as the corresponding 1991 quarter. The third 1992 quarter benefited from the lower operating loss and lower interest expense due to favorable interest rates. This improvement was offset by the absence this year of a cumulative tax benefit associated with the tax deduction of amortization expense of certain intangibles recorded in the third 1991 quarter.
 Year-to-Date Results Reviewed
 Total revenues for the nine months ended Sept. 30 were $207.3 million, 23 percent higher than the $168.7 million reported for the prior year. Service revenues increased 26 percent to $191.3 million, as compared to $152.2 million reported in 1991.
 Operating loss for the nine months ended Sept. 30 was $29.7 million, compared to $41.2 million, before one-time merger integration costs reported in 1991. The lower net loss is due to higher revenues, partially offset by higher operating expenses associated with increased subscribers, higher subscriber additions and expansion of operations in MSA and RSA markets.
 The nine months' net loss of $82.4 million at Sept. 30 was almost $11 million lower than the loss reported for the corresponding 1991 period, excluding the net effect of the one-time merger costs and gain on sale of assets recorded in 1991. This decrease was primarily due to the lower operating loss and lower net interest expense associated with lower interest rates, partially offset by higher borrowings.
 Contel Cellular provides mobile and portable-telephone services in 36 metropolitan markets in the United States. The company is a limited partner in 29 additional metropolitan markets and has ownership interest in 84 rural service areas. Based on total-market population or POPs, Contel Cellular is the sixth-largest cellular company in the United States, with interests in cellular systems representing 24.2 million POPs.
 Contel Cellular is a publicly-traded company, of which 90 percent of the outstanding shares are indirectly owned by GTE Corp. (NYSE: GTE).
 GTE is the fourth-largest publicly-owned telecommunications company in the world. With approximately $20 billion in revenues in 1991, the corporation is the largest U.S.-based local-telephone company and the second-largest cellular service provider in the United States.
 CONTEL CELLULAR INC.
 Consolidated Statements of Operations
 (Thousands, except per-share data)
 Unaudited
 3 mos. ended 9/30/92 9/30/91 Change Pct.
 Revenues & sales: chg.
 Service revenues $68,299 $56,760 11,539 20.3
 Equipment sales 5,949 5,910 39 0.7
 Total 74,248 62,670 11,578 18.5
 Costs and expenses:
 Cost of services 8,956 8,992 (36) (0.4)
 Cost of equipment sales 7,859 8,119 (260) (3.2)
 Selling, general & admin. 42,129 33,722 8,407 24.9
 Depreciation 12,934 12,647 287 2.3
 Amortization of intangibles 10,389 19,808 (9,419) (47.6)
 Merger integration costs --- --- --- ---
 Total 82,267 83,288 (1,021) (1.2)
 Operating loss (8,019) (20,618) 12,599 (61.1)
 Interest expense, net 35,135 40,297 (5,162) (12.8)
 Loss before minority interests (43,154) (60,915) 17,761 (29.2)
 Minority interests 32 27 5 18.5
 Loss from consolidated operations (43,122) (60,888) 17,766 (29.2)
 Equity in earnings of unconsolidated
 partnerships 7,214 5,531 1,683 30.4
 Gains on sales of partnership
 interests --- 965 (965)(100.0)
 Loss before income taxes (35,908) (54,392) 18,484 (34.0)
 Benefit from income taxes (10,535) (29,288) 18,753 (64.0)
 Net loss $(25,373)$(25,104) (269) 1.1
 Net loss per share $ (0.25)$ (0.25) (0.00) 1.1
 Wtd. average shares outstanding 99,943 99,944 (1) (0.0)
 9 mos. ended 9/30/92 9/30/91 Change Pct.
 Revenues sales: chg.
 Service revenues $191,344 $152,170 39,174 25.7
 Equipment sales 15,948 16,506 (558) (3.4)
 Total 207,292 168,676 38,616 22.9
 Costs and expenses:
 Cost of services 26,063 25,939 124 0.5
 Cost of equipment sales 23,921 22,253 1,668 7.5
 Selling, general & admin. 120,009 94,357 25,652 27.2
 Depreciation 35,964 31,329 4,635 14.8
 Amortization of intangibles 31,054 35,995 (4,941) (13.7)
 Merger integration costs --- 11,668 (11,668) ---
 Total 237,011 221,541 15,470 7.0
 Operating loss (29,719) (52,865) 23,146 (43.8)
 Interest expense, net 108,137 120,085 (11,948) (9.9)
 Loss before minority interests (137,856)(172,950) 35,094 (20.3)
 Minority interests 891 1,499 (608) (40.6)
 Loss from consolidated operations (136,965)(171,451) 34,486 (20.1)
 Equity in earnings of unconsolidated
 partnerships 18,090 11,996 6,094 50.8
 Gains on sales of partnership
 interests --- 7,826 (7,826)(100.0)
 Loss before income taxes (118,875)(151,629) 32,754 (21.6)
 Benefit from income taxes (36,464) (56,326) 19,862 (35.3)
 Net loss $(82,411)$(95,303) 12,892 (13.5)
 Net loss per share $ (0.82)$ (0.95) 0.13 (13.5)
 Wtd. average shares outstanding 99,943 99,944 (1) (0.0)
 -0- 10/26/92
 /CONTACT: Ted Carrier, 404-804-3549, or Jeff Keller, 404-391-8358, both of Contel Cellular/
 (CCXLA GTE) CO: Contel Cellular Inc. ST: Georgia IN: TLS SU: ERN


EA-BN -- AT008 -- 4942 10/26/92 15:08 EST
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Date:Oct 26, 1992
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