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U.S. Cellular Reports Second Quarter Results ; Data Revenues Increase 31 Percent; As Previously Announced, U.S. Cellular(R) Will Hold a Teleconference on Aug. 6, 2009, at 10:00 A.M. Chicago Time. Interested Parties May Listen to the Call Live By Accessing the Conference Calls Page of Www.Teldta.Com or Uscellular.Com.
Thursday, August 06, 2009 11:59 AM


(Source: PRNewswire)trackingCHICAGO, Aug. 6, /PRNewswire-FirstCall/ --

Note: Comparisons are year over year unless otherwise noted.

2Q 2009 Highlights

-- Service revenues were $974.8 million.

-- 31 percent increase in data revenues, to $162.0 million, representing 17

percent of service revenues.

-- ARPU (average monthly service revenue per unit) was $52.41.

-- 20 percent increase in operating income, to $140.9 million.

-- Postpay churn was 1.7 percent; postpay customers comprised 95 percent of

retail customers.

-- 7 percent increase in cell sites in service, to 7,043.

-- Repurchased 140,000 common shares for $6.0 million to offset dilution

from employee benefit plans.

United States Cellular Corporation (NYSE: USM) reported service revenues of $974.8 million for the second quarter of 2009, a 1 percent decrease from $987.4 million in the comparable period one year ago, due to a $22.0 million reduction in inbound roaming revenues related primarily to the acquisition of Alltel Corporation by Verizon Wireless. U.S. Cellular recorded operating income of $140.9 million, a 20 percent increase from $117.9 million in the second quarter of 2008. Net income attributable to U.S. Cellular and related diluted earnings per share were $83.4 million and $0.96, respectively, for the second quarter of 2009, compared to $72.6 million and $0.83, respectively, in the comparable period one year ago.

"U.S. Cellular had a net loss in retail customers for the second quarter," said John E. Rooney, U.S. Cellular president and CEO, "due to the combined effect of the weak economy and very competitive market conditions. The launch of the latest iPhone and other exclusive handsets was a factor, as was the increased presence and competitiveness of low-priced, prepaid service providers in some of our markets. Customers have responded well, however, to the new national plans we introduced late in the quarter, and to our industry-first Battery Swap program, which meets a widespread customer need.

"Despite the challenges we faced in the quarter," continued Rooney, "we achieved solid financial results, with increased operating income and operating cash flow. After adjusting for a decline in roaming revenues that resulted from Verizon's acquisition of Alltel, service revenues increased slightly, due to continued growth in demand for data services. In fact, data revenues grew 31 percent and now represent 17 percent of service revenues. We expect this growth to continue, as we bring our 3G network -- which now covers 40 percent of our customer base -- to 70 percent of our customers by year end. We have also implemented additional cost controls to ensure ongoing funding for important multi-year initiatives designed to promote online sales and enhance our billing and customer relationship management capabilities."

Guidance

Guidance for the year ending Dec. 31, 2009 is as follows. There can be no assurance that final results will not differ materially from this guidance.

U.S. Cellular 2009 guidance as of Aug. 6, 2009 is as follows:

Net retail customer additions(1)

Service revenues__ $3,900 - $3,950 million

Operating income(2)__ $300 - $375 million

Depreciation, amortization and__ Approx. $600 million

accretion(2)

Capital expenditures__ Approx. $575 million

(1) U.S. Cellular has withdrawn its net retail customer additions

guidance for the remainder of 2009 due to uncertainty related to

the weak economy and consumer purchasing intentions.

(2) Includes losses on disposals of assets.

The foregoing guidance represents the views of management as of Aug. 6, 2009 and should not be assumed to be accurate as of any other date. U.S. Cellular undertakes no legal duty to update such information, whether as a result of new information, future events, or otherwise.

Conference call information

U.S. Cellular will hold a conference call on Aug. 6, 2009 at 10:00 a.m. Chicago time.

-- Access the live call on the Conference Calls page of uscellular.com at

phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=6742

2&eventID=2355543

-- Access the call by phone at 800/706-9695 (US/Canada) and use conference

ID #22679990.

Before the call, certain financial and statistical information to be discussed during the call will be posted to the Conference Calls page of uscellular.com, together with reconciliations to generally accepted accounting principles (GAAP) of any non-GAAP information to be disclosed. The call will be archived on the Conference Calls page of uscellular.com

About U.S. Cellular(R)

United States Cellular Corporation, the nation's fifth-largest, full-service wireless carrier, provides a comprehensive range of wireless products and services, excellent customer support, and a high-quality network to approximately 6.2 million customers in 26 states. The Chicago-based company employed approximately 8,700 full- time equivalent associates as of June 30, 2009. For more information about U.S. Cellular, visit uscellular.com.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward- looking statements. This includes all statements about the company's plans, beliefs, estimates, and expectations. These statements are based on current estimates, projections, and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: The ability of the company to successfully manage and grow its markets; the current credit crisis affecting financial markets, and its effects on the overall economy; competition; the state and federal telecommunications regulatory environment; the value of assets and investments; adverse changes in the ratings afforded our debt securities by accredited ratings organizations; industry consolidation; advances in telecommunications technology; uncertainty of access to the capital markets; pending and future litigation; changes in income tax rates, laws, regulations or rulings; acquisitions/divestitures of properties and/or licenses; changes in customer growth rates, average monthly revenue per unit, churn rates, roaming revenue and terms, the availability of handset devices, or the mix of products and services offered by the company; and the ability to obtain or maintain roaming arrangements with other carriers. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K used by U.S. Cellular to furnish this press release to the SEC, which are incorporated by reference herein.



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