3 Telecommunications Firms’ Profits Rise
Despite a weak economy, three telecommunications companies reported sharply higher second-quarter earnings. Cost controls and expanding markets for products and services ranging from cellular phones to automatic faxing contributed to the increases.
GTE Corp. said quarterly earnings rose 13.2%, BellSouth Corp. said earnings rose 25.5% and US West said earnings rose 11.9%.
The Stamford, Conn.-based GTE earned a record $446 million or 49 cents a share on continuing operations, up from $394 million or 44 cents a share the year before.
“The long-term strategic-positioning steps taken by GTE over the past several years are generating positive results while at the same time improving our competitive position,” said Chairman Charles R. Lee.
Revenues for the quarter rose 4% to $5.06 billion, up from $4.85 billion the year before.
The 1991 results included a one-time accounting charge of $204 million, or 23 cents a share, in connection with GTE’s merger with Contel and a gain on transfer of certain cellular properties.
GTE is the largest U.S.-based local telephone company and the No. 2 cellular telephone operator in the United States.
BellSouth earned $458.5 million or 94 cents a share in the quarter, up from $365.3 million or 76 cents a share the year before. Revenues totaled $3.82 billion, up 6.7% from last year’s $3.58 billion.
John L. Clendenin, chairman and chief executive of the Atlanta-based company, attributed the improvement to strong performances in its telephone and wireless businesses and an emphasis on cost controls. The company’s cellular telephone subscribers exceeded 1.2 million in the United States at midyear, up 50% from the year before.
US West earned $309.5 million or 75 cents a share on revenues of $2.54 billion, compared to earnings of $276.6 million or 70 cents a share on revenues of $2.5 billion the year before.
The company said it benefited from growth in telephone access lines and cellular subscribers at home and growth in a cable-telecommunications venture in Britain.
