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Frontier Communications Corp. reported adjusted first-quarter net income of $48.4 million, or a nickel a share, roughly flat with a year ago, but below Street expectations.
Adjusted net income attributable to common shareholders excludes acquisition and integration costs, along with other items
Analysts polled by Thomson Reuters expected the company to post earnings per share of 7 cents and revenues of $1.17 million.
Revenues for the quarter declined by 4.3 percent to $1.15 billion, compared with $1.21 billion a year ago, the company reported after the market closed Tuesday.
Net income attributable to common shareholders totaled $39.3 million, or 4 cents a share, compared with $48.1 million, or 5 cents a share, in the first quarter 2013.
Shares of Frontier stock (NasdaqGS: FTR) were trading at $5.86 Wednesday midday, down nearly 2 percent from Tuesday’s close of $5.96.
The telecommunications company employs roughly 1,400 in the Rochester area.
"We are extremely pleased to report that the strong momentum we experienced in all four quarters of 2013 continued in the first quarter of 2014," said Maggie Wilderotter, chairman and CEO in a statement.
At the close of the quarter the company had nearly 2.8 million residential customers and 266,400 business customers. Total residential revenue was $496 million for the first quarter, a decrease from the first quarter of 2013 at $514.7 million.
The company posted operating income of $226 million, compared with $257 million a year ago.
The company had $10.6 million in acquisition and integration costs for the first quarter. Its deal for AT&T Inc.’s Connecticut wireline operations for roughly $2 billion is expected to bring Frontier some 415,000 data, 900,000 voice and 180,000 video residential connections.
"We have been making headway in laying the groundwork for integration of the AT&T Connecticut properties we are acquiring,” said Daniel McCarthy, Frontier's president and chief operating officer in a statement. “We believe the acquisition will still close in the fourth quarter of 2014."
Total business revenue was down 3.4 percent at $524.9 million, compared with $548.3 million during the first quarter 2013. The company added 37,200 broadband customers in the first quarter as well as 5,000 net video customers.
Higher payroll taxes contributed to an increase in operating expenses, which totaled $528.9 million compared to $541.5 million in 2013’s first quarter.
As of March 31 the company had $954 million in cash and cash equivalents.
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