Verizon posts USD2.3 billion profit surge; cancels wireless IPO

30 Jan 2003

Manhattan-based telco Verizon Communications [NYSE: VZ] has posted a fourth quarter profit of USD2.3 billion on the back of the addition of almost a million new mobile subscribers to its wireless subsidiary Verizon Wireless. During the three month period Verizon Wireless added 964,000 subscribers to its networks, though the growth came somewhat at the expense of the parent’s fixed line operations, as customers exchanged second lines for wireless subscriptions. Nonetheless Verizon added 566,000 long-distance customers to become the country’s third largest provider of consumer long-distance services with 10.4 million customers at year end. Net additions of DSL lines exceeded 148,000 in the quarter, for a total of 1.8 million lines, a 50% increase in twelve months. At the end of 2002 the wireless subsidiary boasted 32.5 million customers. For the twelve months of 2002 Verizon Communication’s earnings, before special items, climbed to USD8.4 billion, compared with USD8.2 billion in 2001. Verizon Wireless accounted for 23% of profit, up from 15% in the previous year. Total debt fell by USD10.2 billion to USD54.1 billion during the course of the year.

In part because of the company’s strong set of results, Verizon withdrew plans from the SEC for a USD5 billion IPO for Verizon Wireless, claiming it no longer needed to raise funds through a share sale. In August 2000 Verizon announced plans to float Verizon Wireless, though two months later the offering was postponed because of the falling stock market. The plan was revived briefly in November 2001, when Verizon said it wanted to complete the IPO by mid-2002.

United States