Telephone And Data Systems Q1 Profit Surges - Update

(RTTNews) - Telephone and Data Systems, Inc. (TDS, TDI) Friday reported a higher first-quarter profit, reflecting fall in operating expenses, despite lower revenues. United States Cellular Corp. (USM), a unit of Telephone and Data Systems, also reported a higher profit for the first quarter.

Telephone and Data Systems' net income available to shareholders for the first quarter surged to $18.24 million or $0.16 per share from $1.41 million or $0.01 per share in the previous year.

According to the provider of telecommunications services, year-over-year comparisons were affected by U.S. Cellular's divestiture transaction, deconsolidation of certain U.S. Cellular partnerships, and acquisitions at TDS Telecom, in 2013.

Three analysts polled by Thomson Reuters expected the company to report a loss of $0.41 per share for the quarter. Analysts' estimates typically exclude special items.

Operating revenues for the quarter declined 9 percent to $1.20 billion from $1.31 billion a year ago, but came in line with analysts' estimates.

Total operating expenses were $1.18 billion, down from $1.30 billion reported last year.

For full year 2014, TDS Telecom still expects operating revenues to be between $1.05 billion and $1.10 billion.

LeRoy Carlson, Jr., president and CEO of the company said, "U.S. Cellular continues to attract new customers and drive smartphone adoption and data use, leading to higher average revenue per customer." In U.S. Cellular, billed ARPU increased to $53.93 from $51.13 in the prior year.

United States Cellular Friday reported first-quarter net income attributable to shareholders of $19.48 million, up from last year's $4.91 million, with earnings per share improving to $0.23 from $0.06.

Total operating revenues for the quarter declined to $925.81 million from $1.08 billion a year ago.

U.S. Cellular capital expenditures for 2014 are expected to be about $640 million, down from $738 million in 2013. TDS is currently trading at $27.85, up 1.27 percent on the NYSE, while TDI ended on Thursday at $24.96.

USM is currently up 2.13 percent to trade at $42.88.