AT&T posts record profit, up 57%, for fourth quarter

January 29, 1993|By New York Times News Service

AT&T reported yesterday record fourth-quarter earnings of $1 billion, or 75 cents a share, up 57.5 percent from a year earlier, when it earned $635 million, or 48 cents a share.

Quarterly revenue of AT&T, the world's largest telecommunications company, which has been struggling in an increasingly competitive industry, totaled $17.5 billion, up 6.3 percent from a year earlier.

The company, whose earnings were within analysts' expectations, was helped mainly by large increases in sales of telecommunications equipment, but also gains in its Universal credit card and a reduction in operating expenses brought about by prior reorganizations and work force reductions.

The earnings gain also appeared large because of reduced 1991 earnings, stemming from a sharp drop in the value of AT&T's holdings in Compagnie Industriali Riunite of Italy, which owns the Olivetti office-equipment company and other firms. The value has been successively cut from $348 million to $131 million to $63 million.

AT&T took a charge of 14 cents a share in 1991 and a charge of 3 cents in the most recent quarter.

Analysts say that in view of the Riunite reduction and restructuring charges, a more realistic comparison in the quarter would be 78 cents a share vs. 62 cents, a gain of about 26 percent.

American Telephone & Telegraph shares are the most widely held in the country, with more than 1.3 billion shares outstanding. In trading on the New York Stock Exchange yesterday, AT&T shares fell 12.5 cents each, to $53.125.

AT&T's quarterly performance was aided substantially by more than $900 million in increased sales of expensive telephone switching and transmission equipment and undersea cable systems.

Revenue from telecommunications services, mainly domestic and international long distance, totaled $9.72 billion in the quarter, down less than a percent from the $9.79 billion in the year-ago period.

Full-year earnings totaled $3.8 billion, or $2.86 a share, compared with $522 million, or 40 cents a share in 1991.

Results for the prior year were hurt by restructuring charges and a recessionary economy. Full-year revenue totaled $64.9 billion, up 2.9 percent from $63.09 billion a year earlier.

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