WSJ -- Nextel Reports Quarterly Profit As It Retires $1.1 Billion in Debt
[Someone out there is retiring debt !]
July 16, 2002
Nextel Reports Quarterly Profit As It Retires $1.1 Billion in Debt
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
Nextel Communications Inc. posted its first-ever quarterly profit and raised
its outlook for the year, helped by the retirement of $1.1 billion in debt.
In late-afternoon trading Tuesday on the Nasdaq Stock Market, shares of
Nextel were up $1.41, or 28%, to $6.41.
The Reston, Va., wireless
telecommunications provider
reported second-quarter net
income of $123 million, or 39
cents a diluted share, helped
by a gain of $139 million on
early retirement of debt. The
profit compares with a loss of
$369 million, or 56 cents a
share, a year ago. The
year-ago period included a
$22 million restructuring
charge.
Nextel, the fifth-largest U.S.
wireless company, said domestic revenue in the quarter rose 25% to $2.2
billion from a year ago. Nextel said it retired $1.1 billion in debt and
preferred stock that it exchanged for common stock. Since June 30, Nextel
said it has agreed to buy back an additional $400 million of debt.
Nextel said it added 471,000 subscribers in the second quarter and now has
9.64 million subscribers. Nextel's average monthly service revenue per
domestic subscriber increased to $71, which the company attributed to
greater customer usage and changes in pricing plans. That was $3 above
analysts' estimates.
Nextel expects 2002 operating cash flow to increase to at least $3 billion,
above its previous target, from $1.9 billion a year ago. The company
expects to benefit from its operational and financial plan. Nextel estimates
2002 capital spending of $2 billion or less, down from $2.38 billion in 2001.
The year-ago level excludes capitalized interest.
In the second quarter, Nextel "continued to build on our track record of
meeting or exceeding expectations," said Paul Saleh, Nextel's executive vice
president and chief financial officer, in a press release.
Updated July 16, 2002 3:43 p.m. EDT
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