Telecom services provider,
Cincinnati Bell Inc.
) reported third-quarter 2013 adjusted earnings of 3 cents per
share, beating the Zacks Consensus Estimate of loss per share of
one cent. The results also surpassed the year-ago earrings of 1
cent per share.
Revenues declined 16.0% year over year to $310.8 million but
surpassed the Zacks Consensus Estimate of $305.0 million.
Adjusted EBITDA decreased 20.5% year over year to $103.3
million in the reported quarter. EBITDA margin was 33% versus 35%
in the prior-year quarter.
were $181 million versus $182 million in the year-ago quarter.
The decline was due to a drop of 11%, 10% and 5% in Other,
Voice and Long distance revenues, respectively. This was
partially offset by 55% and 3% growth in Entertainment and Data
Total local access lines were 541,200 at the end of the
reported quarter and comprised 485,300 in-territory lines and
55,900 out-of-territory lines.
Total High-speed Internet customers for the quarter were
265,600 including 191,300 DSL broadband subscribers and 74,300
Cincinnati Bell continues to expand the availability of its
Fioptics fiber-to-the-home products suite, which provides
entertainment, high-speed Internet and voice services. Fioptics
entertainment subscribers reached 74,300 at the end of the third
quarter, up from 52,300 in the year-ago quarter.
revenues declined 17% year over year to $49.1 million due to
lower service (down 18%) and equipment (9%) revenues. The company
exited the third quarter with 355,200 wireless customers,
including 209,400 post-paid and 145,800 prepaid customers.
IT Services and Hardware revenues climbed 12% year over year
to $87.5 million while revenues from Managed and Professional
services were up 9% year over year. Telecom and IT equipment
distribution revenues grew 14%.
Cincinnati Bell ended the quarter with net debt of $2.20
billion compared with $2.67 billion at the end of 2012. The
company incurred capital expenditure of $46.0 million during the
For full-year 2013, Cincinnati Bell expects revenues and
adjusted EBITDA of approximately $1.2 billion and $400-$410
We believe that Cincinnati Bell enjoys a comfortable market
position owing to its distinguished brand name, attractively
priced service bundles as well as proactive marketing and
expansion strategies. Cincinnati's Wireline segment remains the
prime growth driver for the company based on its strong Fioptics
business. New projects and the spin-off of CyrusOne into a
separate entity are expected to work in favor of the company and
aid earnings growth in the future.
Cincinnati Bell, which operates with other carriers like
Frontier Communications Corp.
), carries a Zacks Rank #3 (Hold).
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