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SBC, Ameritech nets rise
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January 21, 1999: 12:01 p.m. ET
Regional Bells post 4Q earnings gains, aided by data lines, Caller ID
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NEW YORK (CNNfn) - SBC Communications and Ameritech, two regional Bell companies that have agreed to merge, both say their fourth-quarter earnings before extraordinary items grew by double digits over 1997.
The 55 cents-per-diluted-share net of SBC (SBC), based in San Antonio, Texas, is a penny above the consensus estimate of analysts surveyed by First Call. The latest results are 19.6 percent higher than the 46 cents a share earnings before items for the final three months of 1997.
Chicago-based Ameritech's (AIT) 61 cents a diluted share net is in line with estimates, and 10.9 percent higher than the 55 cents a share reported for 1997's fourth quarter.
SBC says charges related to its acquisition of SNET resulted in net income of $756 million, or 41 cents a diluted share, up from $642 million, or 33 cents, in the fourth quarter of 1997. Revenue grew by 8 percent to $7.68 billion.
For all of 1998, SBC posted net income of $4.02 billion, or $2.03 a share, up from $1.67 billion, or 85 cents. Revenue rose 7.9 percent to $28.78 billion.
A gain on the sale of some telecom and directory assets helped to push Ameritech's fourth-quarter net earnings to $762 million, or 68 cents a diluted share. That's up from $610 million, or 55 cents, in the final three months of 1997.
Ameritech's 1998 net income was $3.61 billion, or $3.25 a diluted share, compared with $2.30 billion, or $2.08, a year earlier. Revenue rose 7.2 percent to $17.15 billion.
Both companies credit increased demand in high-capacity, high-speed services and Caller ID services for their fourth-quarter and full-year improvement. In California, the company says penetration of the Caller ID service has more than doubled.
Both SBC and Ameritech shareholders have approved the merger, which now requires regulatory consent. The companies say they expect to complete the transaction, under which Ameritech holders will receive 1.316 SBC shares for each share they possess, by the middle of this year.
SBC Communications stock is down 7/8 to 57-5/8 in mid-Thursday trading. Ameritech shares are down 5/8 to 68-3/8.
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