) reported weak second-quarter 2013 results due to voice and
digital television subscriber loss and reduced intrastate access
rates. These were partially offset by strong strategic revenues
and data and integrated service revenues.
Quarterly adjusted earnings per share of 7 cents were below
the Zacks Consensus Estimate of 9 cents. Comparing with the
prior-year quarter, the results dropped 41.7% from 12 cents.
Pro forma revenues decreased 1.8% year over year to $1,506.1
million in the second quarter and was below the Zacks Consensus
Estimate of $1,512.0 million. Total service revenue and Product
sales fell 1.31% and 13.8% year over year, respectively.
Adjusted OIBDA (excluding non-cash pension expense, non-cash
stock-based compensation and restructuring charges) was $582.3
million in the second quarter compared with $590.6 million in the
During the second quarter, total access lines, which include
voice lines, high-speed Internet and digital television
customers, decreased 4.0% year over year to $3.39 million. Voice
lines and digital television customers witnessed a year-over-year
decline of 5.5% and 4.9%, respectively, while high-speed Internet
fell a marginal 1.3%.
Windstream exited the second quarter with cash and cash
equivalents of $78.3 million compared with $132.0 million at the
end of 2012. Long-term debt and capital lease obligations were
$8,867.9 million compared with $8,099.8 million at the end of
For the second quarter, the company generated adjusted free
cash flow of $170.0 million and capital expenditure was $220.5
For full-year 2013, Windstream expects total revenue to
decline 1-3% as compared to 2012 mainly due to softer business
sales environment and continuous pressure in the carrier
transport business. The company expects adjusted OIBDA to remain
in the range of negative 3% to positive 1% as compared to 2012.
Adjusted capital expenditure is expected to be of $815 million to
$830 million and adjusted free cash flow of $860-$960
We believe that a competitive market scenario, continuous
access line loss, regulatory issues and constant upgrades in the
technological scenario will impede the company's growth
Other telecom companieslike
Century Link Inc.
), reported second-quarter results on Aug 7, 2013, after the
market closed. Frontier's adjusted earnings of 6 cents were in
line with the Zacks Consensus Estimate, while CenturyLink's
adjusted earnings of 69 cents were ahead of the Zacks Consensus
Estimate of 67 cents.
Windstream currently carries a Zacks Rank #4 (Sell). Other
stocks worth considering within the same sector is
), which currently carries a Zacks Rank #1 (Strong Buy).
CINCINNATI BELL (CBB): Free Stock Analysis
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WINDSTREAM CORP (WIN): Free Stock Analysis
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