Cingular Adds 1.8M Subs

Cingular reported solid fourth-quarter results driven by its best-ever overall churn and record net customer additions

January 24, 2006

2 Min Read

ATLANTA -- Cingular Wireless LLC, which is a joint venture between AT&T Inc., formerly SBC Communications Inc. (NYSE: T), and BellSouth Corporation (NYSE: BLS), today reported solid fourth-quarter results driven by its best-ever overall churn, record net customer additions, strong gross additions, progress on merger initiatives, growth of data ARPU, and strength in enterprise services.

For the quarter, the nation's largest wireless provider reported monthly subscriber churn of 2.1 percent -- its lowest ever. This represents an improvement of 30 basis points* over the year-ago fourth quarter and a sequential improvement of 20 basis points. Postpaid churn improved sequentially by 10 basis points to 1.9 percent.

Driven in part by its churn results, Cingular also reported a record 1.8 million net customer additions, which is more than double the number reported in the third quarter of 2005 and compares to 1.7 million pro forma net additions in the fourth quarter of 2004.

Retail customers accounted for approximately 840 thousand net adds for the fourth quarter of 2005, with the rest coming from resellers. Retail net adds resulted from steady growth in postpaid customers and increased growth in Cingular's popular GoPhone ® prepaid offers.

Gross additions were 5.1 million, which is a sequential improvement of 750 thousand customers and less than 100 thousand on a comparable basis from pro forma gross additions in the fourth quarter of 2004*. The sequential improvement in gross adds was primarily driven by holiday buying activity of prepaid and reseller customers.

Cingular ended 2005 with 54.1 million cellular/PCS subscribers, an increase of 5 million over 2004.

Cingular's data ARPU was $4.71, up 63 percent over the year-ago fourth quarter and a sequential improvement of 9 percent. The company's Business Markets Group signed more than 800 high-end service contracts in the fourth quarter of 2005.

Normalized OIBDA margins for the fourth quarter of 2005 were 31.0 percent, which is an improvement of 760 basis points compared to normalized year-ago fourth quarter results but a sequential decline of 60 basis points from normalized OIBDA margins for the third quarter of 2005 due to anticipated seasonal factors.**

"Cingular finished 2005 on a high note," said Stan Sigman, Cingular's president and chief executive officer. "Our best-ever churn, record net customer additions, the fourth straight quarter of accelerating revenue growth, rising data ARPU, solid margins, and on-target merger initiatives indicate that America's largest wireless company is taking the right steps to become the most highly regarded wireless company in the world."

Cingular Wireless

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