Posted on: Wednesday, August 15, 2007
Tax benefit pushes Hawaiian Tel profit to $21.4M
Hawaiian Telcom's $21.4 million second-quarter profit was driven by a one-time $52.5 million tax benefit relating to the proposed sale of the company's directories publishing business. That compared with a $32.2 million loss in the second quarter of 2006.
THE NUMBERS
Operating revenue: $121.4 million, vs. $127.8 million a year ago.
Net income: $21.4 million, vs. $32.2 million loss a year ago.
FY 2007 operating revenue: $246.9 million, vs. $253.8 million a year ago.
FY 2007 net income: $36.9 million, vs. $70.8 million loss a year ago.
THE REASONS
The company recorded a $52.5 million tax benefit relating to the proposed sale of its directories publishing business.
Operating revenues during the three months ended June 30 fell 5 percent from the year-ago quarter to $121.4 million because of a decline in switched access lines and a higher-than-anticipated level of billing adjustments.
High-speed Internet revenues decreased 14.5 percent from the second quarter of 2006 to $8.8 million because of higher levels of billing credits and certain promotional pricing programs.
The number of switched access lines fell 11.5 percent from the second quarter of 2006 to 345,556 as customers increasingly switched voice service to Internet, cable and wireless alternatives.
WHAT THEY ARE SAYING
"Our continued progress is not fully reflected in our financial results, but we believe we have taken the steps needed to improve the business, so we can drive improved future results and deliver better service and value to our customers."
Mike Ruley
Chief executive officer
WHAT'S NEXT
Hawaiian Telcom expects to sell its directories publishing business to Colorado-based Local Insight Media for $435 million no later than the first quarter of 2008. The sale is subject to Hawai'i Public Utilities Commission approval.
The company plans to launch a TV service early next year.
Hawaiian Telcom will host a conference call to discuss its second-quarter results tomorrow morning.
