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UNITED STATES CELLULAR REPORTS 66 PERCENT INCREASE IN THIRD QUARTER REVENUES AND CONTINUED EXPANSION OF ITS SYSTEMS

 UNITED STATES CELLULAR REPORTS 66 PERCENT INCREASE IN
 THIRD QUARTER REVENUES AND CONTINUED EXPANSION OF ITS SYSTEMS
 CHICAGO, Nov. 10 /PRNewswire/ -- United States Cellular Corp. (AMEX: USM) today reported increases in customers and service revenues of 58 percent and 66 percent, respectively, during the quarter ended Sept. 30, 1992.
 Operating loss improved 12 percent and operating cash flow increased 110 percent. However, higher interest expense resulted in a $6.0 million, or $.12 per share, net loss for the quarter compared to $4.4 million, or $.10 per share, in the same period last year. Additionally, the company reported that it had reached agreements to further expand its systems through the acquisition of interests representing approximately 1.7 million population equivalents (POPs).
 Service revenues totaled $42.2 million for the quarter ended Sept. 30, 1992, compared to the $25.3 million reported for the same period in 1991. Increases in both customers and average monthly revenues per customer fueled the gain. Customers served by the company's majority owned and managed systems increased 58 percent to 134,500 at Sept. 30, 1992, compared to 85,200 at Sept. 30, 1991. During the third quarter, the company's distribution channels added 13,300 new customers, a 68 percent increase over the 7,900 new customers added in the same period in 1991. Unusually rapid growth in customers during September resulted in higher third quarter marketing costs that temporarily slowed growth in operating income.
 "The strong showing in customer growth reflects continued penetration gains in our older markets and quick acceptance of our services in the new markets," reported H. Donald Nelson, the company's president and chief executive officer. "Additionally, stong roaming revenues, especially from the Rural Services Areas (RSAs), continue to push average monthly revenue per customer above last year's averages."
 Operating expenses, including losses on sales of cellular telephones, increased 59 percent to $44.8 million in 1992 from $28.3 million in 1991. This increase results from a higher number of new customer activations and expenses related to expanding the company's coverage areas and serving the larger customer base. The company's cellular systems consisted of 291 cell sites serving 87 majority-owned and managed markets at Sept. 30, 1992, compared to 145 cell sites serving 50 such markets at Sept. 30, 1991.
 Operating loss before minority share totaled $2.7 million, a slight improvement from the $2.9 million reported at Sept. 30, 1991. Additionally, a 40 percent increase in net investment income was offset by a 54 percent increase in interest expense.
 Operating cash flow totaled $5.2 million in the most recent quarter, representing a 110 percent increase from $2.5 million reported for the third quarter of 1991.
 For the nine months ended Sept. 30, 1992, service revenues rose 72 percent, totaling $109.7 million in 1991. The gain was driven by substantial growth in the customer base and increases in average monthly revenue per customer. The number of customers in the company's majority-owned markets increased 58 percent in 1992 over 1991. USM added 37,500 new customers in the first nine months of 1992, 5,400 of which were added through acquisitions. During the same period of 1991, the company added 27,900 customers, 5,700 of which were added through acquisitions. Average monthly revenue increased 6 percent on a year- over-year basis, totaling $104 in 1992. The strong revenue gains resulted in a 35 percent decrease in the operating loss before minority share and produced a $12.4 million increase in operating cash flow. The company reported $14.3 million in gains on the sale and exchange of certain cellular interests in 1992. The improved operating results, gain on sale, and higher investment income, offset by increased interest expense and income tax expense, resulted in a $1.7 million net loss for the nine months ended Sept. 30, 1992, compared to a $15.9 million net loss before the cumulative effect of a change in accounting principle for the same period of 1991.
 UNITED STATES CELLULAR
 Financial Highlights
 (Unaudited; dollars in millions)
 Three months ended Sept. 30 1992 1991 Change
 Service revenue $42.2 $25.3 66 pct
 Operating (loss) before minority share (2.7) (2.9) 9
 Operating cash flow 5.2 2.5 110
 Interest expense 5.1 3.3 (54)
 Net (loss) $(6.0) $(4.4) (36)
 Nine months ended Sept. 30 1992 1991 Change
 Service revenue $109.7 $ 63.7 72 pct
 Operating (loss) before minority share (6.1) (9.3) 35
 Operating cash flow 15.1 2.7 462
 Gain on sale of cellular interest 14.3 .2 N/M
 Interest expense 14.6 12.3 (18)
 Net (loss) before cumulative effect
 of accounting change (1.7) (16.0) 89
 Net (loss) $(1.7) $(26.2) 93
 Mr. Nelson commented, "The dramatic growth in service revenues and operating cash flow is a result of our market growth and operating strategy. Our high quality service provides greater coverage and higher value to our local and roaming customers."
 During the quarter, the company continued to expand and enhance its service areas through its acquisition program. USM reached agreements to acquire control of ten more RSAs representing 1.6 million POPs. Additionally, the company added approximately 100,000 POPs in some of its existing markets. Nine of the ten new managed markets are adjacent to other USM-managed clusters. During the first nine months of 1992, the company has acquired or has agreed to acquire interest totaling 1.9 million POPs compared to 2.9 million during the same period in 1991. As of Sept. 30, 1992, USM owned or had the right to acquire approximately 19.8 million POPs.
 "We are committed to the future of wireless communications and continue to pursue attractive opportunities to expand our service footprints," said Nelson. "Amortization and financing of these costs will slow our near-term growth to profitability. However, we anticipate that these factors will have minimal impact on near-term operating cash flow and will enhance our potential for long-term profitability."
 The accompanying table summarizes the POPs and markets owned or acquirable by USM at Sept. 30, 1992.
 Population Equivalents in Markets
 (Millions)
 Majority
 Owned and
 Managed Managed Investments Total
 MSAs:
 Owned 4.96 .10 2.78 7.84
 Acquirable .20 -- .01 .21
 RSAs:
 Owned 8.28 .44 .36 9.08
 Acquirable 2.59 .02 .09 2.70
 Total 16.03 .56 3.24 19.83
 Number of markets 111 13 64 188
 In addition, the company announced that the board of directors had approved a change in the company's Certificate of Incorporation, authorizing an additional 70 million common shares. This action was taken to ensure that the company has the financial flexibility required to continue its development plans. As shown in the following table, the company had a total of 50.8 million common shares outstanding and commitments to issue another 11.3 million shares. Also, the company had total debt of $282 million at Sept. 30, 1992, including borrowings under the revolving credit agreement with USM's parent company, Telephone and Data Systems, Inc., and debt commitments of $95 million for pending acquisitions.
 Headquartered in Chicago, USM manages and invests in cellular systems throughout the United States. As of Sept. 30, 1992, USM owned or had rights to acquire interests totaling 19.8 million POPs in 74 Metropolitan Statistical Areas (MSAs) and 114 RSAs. At that date, USM managed operational systems serving 34 MSAs and 78 RSAs.
 (Unaudited -- Millions) Debt Equity Shares
 Outstanding at Sept. 30, 1992
 Series A Common Shares -- $ 26.5 26.5
 Common Shares (A) -- 24.3 24.3
 Preferred Shares (B) -- 19.7 .2
 Additional Paid-in Capital -- 332.4 --
 Debt $282.5 -- --
 Total outstanding at Sept. 30, 1992 $282.5 402.9 51.0
 Estimated common shares issuable
 for completed acquisitions -- 131.8 6.5(A)
 Estimated debt and common shares
 issuable for pending acquisitions 95.0 80.2 4.8(A)
 Sept. 30, 1992, totals adjusted
 for anticipated acquisition-
 related transactions $377.5 $614.9 62.6
 (A) -- The aggregate 11.3 million common shares commited for issuance in future years are scheduled to be issued approximately 1.4 million shares in 1992, 2.8 million in 1993 and 7.1 million in 1994 and later years.
 (B) -- Preferred shares are convertible into 1.1 million USM common shares.
 UNITED STATES CELLULAR CORP.
 Financial Highlights
 (Unaudited; dollars in thousands except per share amounts)
 Nine months ended Increase (Decrease)
 9/30/92 9/30/91 Amount Percent
 Service revenues $109,723 $ 63,705(A) $ 46,018 72.2
 Operating expenses 110,997 68,998(A) 41,999 60.9
 Service operating (loss) (1,274) (5,293) 4,019 75.9
 Equipment sales 6,283 5,013 1,270 25.3
 Cost of equipment sold 11,107 9,060 2,047 22.6
 Equipment sales (loss) (4,824) (4,047) (777) (19.2)
 Operating (loss) before
 minority share (6,098) (9,340) 3,242 34.7
 Minority share of
 operating (income) (2,266) (1,246) (1,020) (81.8)
 Operating (loss) (8,364) (10,586) 2,222 21.0
 Investment income,
 net of license
 cost amortization 9,039 4,593 4,446 96.8
 Gain on sale of
 cellular interests 14,331 246 14,085 N/M
 Other income (expense) (63) 2,136 (2,199) (102.9)
 Interest expense (14,569) (12,342) (2,227) (18.0)
 Income tax expense (2,115) (10) (2,105) N/M
 Net (loss) before
 cumulative effect
 of a change in
 accounting principle (1,741) (15,963) 14,222 89.1
 Cumulative effect of a
 change in accounting
 principle -- (10,269) 10,269 N/M
 Net (loss) $ (1,741) $ (26,232) $ 24,491 93.4
 Weighted average common
 and Series A common
 shares (000s) 49,826 36,121 13,705 37.9
 (Loss) per common share:
 Before cumulative effect
 of a change in
 accounting principle $ (.03) $ (.45) $ .42 93.3
 Cumulative effect of a
 change in accounting
 principle -- (.28) .28 N/M
 Net (loss) $ (.03) $ (.73) $ .70 95.9
 Operating cash flow $ 15,117 $ 2,692 $ 12,425 461.7
 Consolidated net
 revenue subscribers 134,500 85,200 49,300 57.9
 Total net revenue
 subscribers in all
 managed markets 159,800 101,600 58,200 57.3
 Three months ended Increase (Decrease)
 9/30/92 9/30/91 Amount Percent
 Service revenues $ 42,154 $ 25,321(A) $ 16,833 66.5
 Operating expenses 42,604 26,789(A) 15,815 59.0
 Service operating (loss) (450) (1,468) 1,018 69.4
 Equipment sales 2,360 1,903 457 24.0
 Cost of equipment sold 4,597 3,371 1,226 36.4
 Equipment sales (loss) (2,237) (1,468) (769) 52.4
 Operating (loss) before
 minority share (2,687) (2,936) 249 8.5
 Minority share of
 operating (income) (582) (760) 178 23.3
 Operating (loss) (3,269) (3,696) 427 11.6
 Investment income,
 net of license
 cost amortization 3,041 2,168 873 40.3
 Gain on sale of
 cellular interests (544) -- (544) N/M
 Other income 205 436 (231) (52.9)
 Interest expense (5,103) (3,312) (1,791) (54.0)
 Income tax expense (329) (7) (322) N/M
 Net (loss) $ (5,999) $ (4,411) $ (1,588) (36.0)
 Weighted average common
 and Series A common
 shares (000s) 50,724 43,975 6,749 15.4
 Net (loss) per
 common share $ (.12) $ (.10) $ (.02) (20.0)
 Operating cash flow $ 5,214 $ 2,486 $ 2,728 109.7
 Consolidated net
 revenue subscribers 134,500 85,200 49,300 57.9
 Total net revenue
 subscribers in all
 managed markets 159,800 101,600 58,200 57.3
 (A) -- Certain 1991 amounts have been restated to conform to current year presentation.
 -0- 11/10/92
 /CONTACT: Kenneth R. Meyers, VP-finance of United States Cellular, 312-399-8900/
 (USM) CO: United States Cellular Corp. ST: Illinois IN: TLS SU: ERN


GK -- NY092 -- 9427 11/10/92 16:22 EST
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Date:Nov 10, 1992
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