BellSouth reports drop in mobile subscribers
By Jonathan Moules in New York
Published: January 23 2003 13:59 | Last Updated: January 23 2003 13:59
BellSouth, the regional US telecommunications group, faced a double bind on Thursday as both its wireless business and traditional phone service suffered decli nes during the fourth quarter.
US telecoms carriers have been battling against falling revenues as customers cancel extra phone lines and switch to wireless service or upgrade their internet connection to high speed broadband that allows users can surf and call from a single line.
On Thursday BellSouth reported a 3.2 per cent drop in access lines to 24.6m during the last year. But the phone company had hoped that it could offset these declines by adding subscribers at Cingular Wireless, the US mobile phone carrier it jointly owns with telecoms rival SBC.
However, Cingular yesterday reported a net loss of 121,000 customers during the quarter, its second sequential loss.
Cingular's losses are in part due to its decision to change the technology standard for its wireless network, according to Tim Luke, research analyst at Lehman Brothers. "Execution has not been as crisp as it could have been," Mr Luke explained. However, he added that US wireless subscriber growth had become "muted".
BellSouth's fourth-quarter net profits fell 25 per cent to $597m, or 32 cents per share, compared with $792m, or 42 cents per share, a year earlier. Excluding one-time items, the Atlanta-based company reported earnings per share of 50 cents. This compared with 63 cents per share in the prior year and analysts' consensus forecast of 51 cents per share, according to Thomson Financial First Call.
Operating revenues, including the Cingular stake, were down 6.8 per cent at $7.12bn. However, operating revenues fell across all BellSouth's divisions. Revenues from the Latin America group were down 1.8 per cent at $486m in the fourth quarter. This reflected the impact of currency devaluations and general economic weakness in Argentina and Venezuela.
Shares of BellSouth were down 6 per cent at $23.66 during afternoon trade in New York yesterday.
news.ft.com |
