TELECOM Digest OnLine - Sorted: Cingular Wireless Posts Strong Second-Quarter Results

Cingular Wireless Posts Strong Second-Quarter Results

Monty Solomon (
Wed, 20 Jul 2005 22:57:48 -0400

Cingular Wireless Posts Strong Second-Quarter Results, Advances Merger
Integration Initiatives

- Net subscriber additions of 1.1 million, third consecutive
quarter of more than 1 million postpaid net additions;

- 51.6 million cellular/PCS subscribers at quarter's end;

- Gross subscriber additions of 4.4 million;

- Postpaid monthly subscriber churn down to 1.8 percent, third
consecutive quarter of improved postpaid churn; total monthly
churn at 2.2 percent;

- A 340 basis-point sequential improvement in normalized OIBDA margin
to 28.9%;

- Continued progress in transitioning subscribers to GSM, with 90
percent of minutes now on Cingular's GSM network.

ATLANTA, July 20 /PRNewswire/ -- Cingular Wireless, a joint venture
between SBC Communications Inc. (NYSE:SBC) and BellSouth Corporation
(NYSE:BLS), today posted strong second-quarter results driven by
continued solid subscriber growth, improvement in margins and postpaid
churn, and strength in data and enterprise services.

For the quarter, the nation's largest wireless provider delivered net
subscriber additions of 1.1 million, nearly all of which were
postpaid. Second-quarter postpaid net additions were comparable to
the number delivered in the first quarter of 2005, and represent the
third straight quarter of more than 1 million postpaid net additions.

Net additions in the second quarter were 2.5 times higher than pro
forma net additions in the year-ago second quarter. (Pro forma
results reflect the acquisition of AT&T Wireless, plus related
acquisitions and dispositions, as if they had occurred on January 1,
2003.) Cingular ended the second quarter of 2005 with 51.6 million
cellular/PCS subscribers.

Gross additions continue to be very strong at 4.4 million. Postpaid
churn improved sequentially to 1.8 percent -- a record low for the
company. This compares to 1.9 percent in the first quarter of 2005
and to 2.1 percent (pro forma) in the fourth quarter of 2004. Overall
churn held at 2.2, which was the same as in the first quarter of 2005,
primarily reflecting the transition of customers on former AT&T
Wireless prepaid plans.

As it sustained strong subscriber growth, Cingular also improved its
margins. OIBDA margin, normalized to exclude merger-related
integration costs, was 28.9 percent, a sequential improvement of 340
basis points. (OIBDA margin is operating income (loss) before
depreciation and amortization, divided by total service revenues.)


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