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BellSouth Reports 12% Growth in Second Quarter Profits

6:00 am on July 25, 2006 | Category: Business, Corporate, Telecom Services

Americaâ€™s number three telecom provider, BellSouth Corp., reported a 12% increase in its second quarter profit yesterday, due to a reduction in expenses, and higher demand for broadband and wireless services.

The Atlanta-based company, which is set to merge with AT&T later this year, posted net earnings of $887 million ($0.49/share), compared to $795 million ($0.43/share) in the second quarter of 2005. Total sales jumped 1.2% to $5.21 billion, excluding revenue from Cingular Wireless, 40% of which is owned by BellSouth.

Adjusted net earnings, including profits from Cingular, came to $1.08 billion ($0.60/share), on sales of $8.82 billion. This slightly exceeds the $0.57/share predicted by a survey of industry analysts.

Growth in BellSouthâ€™s broadband and long distance divisions, as well as record profits from Cingular Wireless, were largely responsible for the growth in earnings.

BellSouth added a total of 128,000 DSL accounts over the three-month period, and signed up 120,000 new long distance customers. Local line rentals, on the other hand, were down 460,000, due to increased competition from cable and wireless operators.

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