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CenturyLink reported a third quarter GAAP net income attributable to the company of $280.84 million or $0.94 per share, compared with $84.73 million or $0.83 per share in the corresponding quarter a year-ago.
Adjusted net income for the quarter was $269.05 million or $0.90 per share, compared to $82.76 million or $0.81 per share in the year-ago period. On average, fifteen analysts polled by Thomson Reuters expected the company to earn $0.81 per share for the quarter. Analysts' estimates typically exclude special items.
The Monroe, Louisiana based company recorded total operating revenues for the quarter of $1.87 billion, a jump from $650.07 million in the year-ago period. Twelve Street analysts' estimated revenues of $1.88 billion for the quarter.
Revenue increase during the quarter was primarily due to $1.299 billion of revenue contribution from the Embarq acquisition completed on July 1. Revenue increases were also driven by growth in high-speed Internet customers and favorable prior period revenue settlements.
Revenues were also partially affected due to the impact of access line losses and lower access revenues, along with the elimination of $53 million of revenues related to the discontinuance of regulatory accounting for certain regulated operating entities during the third quarter 2009.
On a GAAP basis, total operating expenses for the quarter, which includes the cost of services and products, selling, general and administrative expenses and depreciation and amortization increased to $1.49 billion from $469.34 million in the year-ago period.
Third quarter earnings reflect after-tax costs associated with the Embarq acquisition of $127.5 million or $0.43 per share, compensated by a net after-tax benefit of $133.2 million or $0.44 per share attributable to the extraordinary gain recognized upon the discontinuance of regulatory accounting and an after-tax benefit of $6.1 million or $0.02 per share related to the favorable resolution of certain transaction tax audit issues. The company, which added more than 43,500 high-speed Internet customers during the quarter, said that it achieved a 16% improvement in access line performance compared with line losses in the comparable period year-ago.
CenturyLink incurred $195.5 million of integration, transaction and other costs related to the Embarq acquisition during third quarter 2009, about $60 million higher than originally expected. The company also incurred approximately $27.1 million of integration-related capital expenditures.
CenturyLink also indicated achieving about $14 million in operating cost synergies during third quarter and expects to realize additional incremental operating cost synergies of approximately $12 million in fourth quarter.
The telecommunications industry saw a volatile quarter with the company's competitor, telecommunications giant AT&T adding wireless customers but reporting a decline in revenues for its third quarter, while Verizon Communications reported an increase in third quarter revenues.
For the fourth quarter, the company anticipates earnings per share in the range of $0.84 per share - $0.88 per share on revenues of $1.81 billion - $1.85 billion .
Twelve Wall Street analysts currently estimate earnings of $0.82 per share on revenues of 1.86 billion for the quarter.
For the full year 2009, the company raised its earnings outlook to a range of $3.45 - $3.50 per share from its prior anticipated range of $3.20 - $3.30 per share. The Street currently estimates earnings of $3.27 per share for the year. For the nine month period, GAAP net income attributable to the company was $417.03 million or $2.50 per share, compared with $265.66 million or $2.53 per share in the year-ago period.
Adjusted net income for the nine month period was $434.24 million or $2.60 per share, compared with $260.09 million or $2.48 per share.
Year-to-date total operating revenues were $3.14 billion, compared with $1.95 billion in the year-ago period.
CTL is currently trading on the New York Stock Exchange at $34.41, up $1.23 or 3.71%.
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