Qwest Posts Gain in 2nd Quarter as Sales Double
Qwest Communications International Inc., the long-distance phone company set to acquire local provider US West Inc., on Tuesday posted a second-quarter profit, compared with a year-earlier loss, as sales of data services more than doubled.
Qwest had pro forma profit of $18.5 million, or 2 cents a share, compared with a pro forma loss of $27 million, or 4 cents a year ago.
The latest results beat Wall Street’s expectations of 1 cent a share, according to research firm First Call Corp. Revenue rose 26% to $873.7 million on a pro forma basis.
Qwest also told analysts it was comfortable with Wall Street’s earnings expectations of 11 cents a share for 1999, analysts said.
US West agreed on July 18 to end its previous merger agreement with Global Crossing Ltd. and accept Qwest’s $36-billion offer. The deal would combine US West’s local, wireless and data operations with Qwest’s long-distance and advanced fiber optic communications network.
Qwest reported its results as if the recent acquisitions of Phoenix Network, LCI International and Icon CMT Corp. had been included from Jan 1, 1998.
Shares of the Denver-based company rose $1.56 to close at $30.13 on Nasdaq.
At a Glance
Other earnings, excluding one-time gains and charges unless noted:
TECNOLOGY:
* Computer Sciences Corp., the third-largest U.S computer services company, said its fiscal first-quarter profit rose 22% to $78.3 million, or 48 cents a share, driven by a surge of new contracts. The results matched the average estimate from analysts surveyed by First Call. Sales increased 18% to $2.06 billion from $1.75 billion, and CSC signed $4.7 billion in new contracts during the quarter.
* Egghead.com Inc. said its fiscal first-quarter loss widened to $10.5 million, or 34 cents a share, from $5.6 million, or 24 cents, a year earlier, but the performance was far better than the 42-cent loss analysts expected. Revenue jumped 37% to $40.6 million, exceeding estimates of $37 million.
* Marimba Inc., a developer of Internet-based software for e-business, reported a net loss of $1.5 million, or 8 cents a share, for the second quarter, as revenue jumped 87% to $6.9 million. Excluding a $451,000 expense for deferred stock compensation, the loss would have been 6 cents a share, the company said. Analysts were expecting a loss of 8 cents.
* MindSpring Enterprises Inc. said it had a second-quarter profit, excluding special charges, of $7.52 million, or 11 cents a share, compared with profit of $2.7 million, or 5 cents, a year ago. Analysts were expecting a profit of 9 cents. Revenue more than tripled to $85.7 million from $25.1 million, and expenses also more than tripled as the company spent more to expand its subscriber base.
* PSINet Inc. said its second-quarter loss widened to $62 million, or $1 a share from a loss of $54.4 million, or $1.06, a year ago. Analysts were expecting a deeper loss of $1.11. Revenue more than doubled to $123.8 million from $53.7 million.
* TheStreet.com Inc.’s second-quarter loss widened to $6.2 million, or 30 cents a share, from $4.7 million, or 61 cents, a year ago, as expenses nearly doubled. The Internet financial news service said revenue nearly tripled to $3.26 million from $1.11 million. Analysts were expecting a loss of 37 cents a share.
OTHER INDUSTRIES
* Columbia/HCA Healthcare Corp. said its profit from continuing operations slipped 4.7% in the second quarter to $182 million, or 31 cents a share, a penny better than estimates, as revenue declined 12.5% to $4.2 billion. The nation’s largest hospital chain said reductions in Medicare reimbursements, rising costs for drugs and supplies and increased bad debt hurt its results.
While analysts said its operations are improving, Columbia/HCA is still affected by negotiations with the Justice Department to settle 3-year-old allegations it defrauded Medicare. A spokesman for the company wouldn’t predict when a settlement, which analysts say could be as much as $1 billion, would be reached.
* Monsanto Co. said its profit from continuing operations jumped 46% to $326 million, or 50 cents a share, in the second quarter, on strong sales of its new arthritis drug, Celebrex, and its herbicide Roundup. The results exceeded analyst forecasts by 5 cents. Net sales rose 23% to $2.59 billion, boosted by pharmaceutical sales in its Searle unit of $937 million, up 54% from $607 million. Sales of Celebrex, which Monsanto said is the most-prescribed non-generic arthritis drug in the U.S. with more than 7 million dispensed, were $318 million, up 14% from the first quarter when the drug was introduced.
* PhyCor Inc., the biggest manager of doctor’s practices, said its second-quarter earnings fell 35% to $9.9 million, or 13 cents a share, matching estimates, as revenue rose 5.9% to $393.5 million. The company also warned that its profit for the year will miss analyst estimates of 55 cents, instead hitting 45 to 50 cents.
