Archive for Tuesday, December 21, 2004

Sprint reaffirms guidance

Overland Park-based firm expects revenues to grow next year

December 21, 2004


Sprint Corp. said Monday that it expected its 2004 financial performance to meet expectations and revenues to grow slightly in 2005, but the company's forecast does not include any effects from Sprint's planned merger with Nextel Communications Inc.

Sprint and Nextel, based in Reston, Va., said last week they would combine in a $35 billion deal that would be the third-largest wireless telephone provider in the country. As part of the merger, Overland Park-based Sprint would spin off its local phone service into a separate company.

Sprint said its 2004 financial results should match predictions provided in October. At that time, the company said that revenue for 2004 should increase between 4 percent and 5 percent, and that earnings before interest, taxes, depreciation and amortization would fall between $8.1 billion and $8.2 billion.

For 2005, the company said it expected revenues to "grow at a low single-digit percentage," predicting that its wireless business would continue to grow, local phone service would remain steady and long distance service would continue to decline amid tough competition in the industry and falling prices.

The company said 2005 earnings before interest, taxes, depreciation and amortization should be between $8.5 billion and $8.7 billion, with most of the growth coming from wireless operations. Sprint plans to update its 2005 estimates in February.

Analysts surveyed by Thomson First Call expect Sprint revenues to increase 3 percent next year to $28.2 billion.

Sprint shares rose 17 cents to close Monday at $24.84 on the new York Stock Exchange.

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