Qwest posts quarterly loss, merger to close April 1
February 15, 2011
The telecommunications company also said that its pending merger with CenturyLink is expected to close April 1.
Qwest posted a net loss of $161 million on revenue of $2.9 billion in the fourth quarter. That compares with a net profit of $108 million on revenue of $3 billion during the same period a year ago.
Customers continue to cut the cord, with Qwest's total landlines dropping nearly 11 percent in 2010 to 8.9 million.
For the year, sales dropped 5 percent to $11.7 billion from $12.3 billion in 2009. The company posted a net loss of 55 million, or 3 cents a share, compared with a profit of $662 million, or 38 cents a share, in 2009 as it took several one-time charges connected to severance payments, the pending merger and other expenses. The charges dropped earnings per share by 47 cents in 2010.
Qwest chief executive Ed Mueller said in a statement that the company made "substantial progress" toward closing its merger with CenturyLink, receiving approval in 18 states with approvals pending in four additional states and the Federal Communications Commission.
"While the timing of the receipt of these approvals cannot be predicted with certainty, we currently expect to receive all required approvals in the first quarter and are planning toward an April 1 closing date," Mueller said.
The combined company will be based at CenturyLink's headquarters in Monroe, La.
Qwest cut 1,795 jobs last year, ending 2010 with 28,343 employees.
The fourth quarter loss included charges to operating expenses of $117 million for accelerated stock-based compensation, severance and realignment, a legal settlement and merger-related expenses. It also included a $267 million charge related to debt conversion.