Verizon Reports Q1 686120

Operating revenues up 0.3% year-on-year

April 21, 2011

2 Min Read

NEW YORK -- Verizon Communications Inc. (NYSE, NASDAQ: VZ) today reported strong first-quarter 2011 earnings, as industry leader Verizon Wireless continued to effectively balance customer growth and profitability, while growth in FiOS and strategic enterprise services contributed to another quarter of improvement in wireline margins.

Verizon reported 51 cents in EPS in first-quarter 2011, compared with first-quarter 2010 earnings of 16 cents per share. There are no adjustments to first-quarter 2011 earnings results. Adjusted first-quarter 2010 earnings, excluding the impact of divestitures and non-operational charges (non-GAAP), were 48 cents per share.

“In the first quarter, Verizon Wireless solidified its industry leadership with results that once again showed sustainable, profitable growth,” said Verizon Chairman and CEO Ivan Seidenberg. “We are executing on our business plans and building momentum, and we are on track to meet both our revenue and earnings objectives for the year.”

Seidenberg added, “Wireline EBITDA margins expanded for the fourth consecutive quarter, driven by continued strength in FiOS revenues and disciplined cost management. Our strategic acquisition of Terremark, which closed earlier this month, improves our ability to provide integrated, enterprise-class cloud solutions and accelerate growth.”

On a consolidated basis, Verizon’s total operating revenues were $27.0 billion in first-quarter 2011, an increase of 0.3 percent compared with first-quarter 2010. Last year’s results included revenues from operations that have since been divested.On a comparable basis (non-GAAP), first-quarter 2011 total operating revenues increased 5.3 percent compared with first-quarter 2010 -- up from growth of 2.3 percent on the same basis comparing fourth-quarter 2010 with fourth-quarter 2009. Approximately 77 percent of first-quarter 2011 revenues were generated by higher-growth wireless, FiOS and strategic enterprise services, compared with approximately 72 percent of comparable first-quarter 2010 revenues.

As previously stated, Verizon is targeting comparable top-line revenue growth rates in the range of 4 percent to 8 percent for full-year 2011. The company is also targeting EPS growth of 5 percent to 8 percent in 2011, over a comparable adjusted base of $2.08 per share in 2010.

Verizon continues to expect 2011 capital spending to be essentially flat, compared with the 2010 investment of $16.5 billion. In first-quarter 2011, Verizon’s capital expenditures totaled $4.4 billion, compared with $3.4 billion in first-quarter 2010, as the company aggressively invested in growth opportunities, including the deployment of Verizon’s nationwide 4G LTE (fourth-generation, Long-Term Evolution) wireless broadband network. With 4G LTE deployment well under way, Verizon’s capitalized interest will be lower in 2011, resulting in higher interest expense of about $150 million for each quarter this year.

Verizon Communications Inc. (NYSE: VZ)

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