Comsat Corp. said yesterday that third-quarter operating profits skidded nearly 70 percent because of decreased earnings in several units, higher borrowing costs and increased tax accruals.
The Bethesda-based communications and entertainment company also said it had filed with the Securities and Exchange Commission for an initial public offering of its entertainment group, which owns several sports teams, a movie company and a satellite distribution service.
Comsat's third-quarter profit from operations totaled $6.6 million, or 14 cents a share, compared to $21.4 million, or 45 cents a share, in the year-ago quarter. An after-tax charge of $22 million, or 47 cents a share, for a previously announced restructuring that included 106 job cuts, resulted in a third-quarter net loss of $15.6 million, or 33 cents, compared with year-earlier net income of $21.4 million, or 45 cents.
Revenue for the quarter totaled $203.9 million, up slightly from $200.8 million last year. Revenue dropped in Comsat's telecommunications and technology businesses. In its telecommunications unit, revenue fell 1 percent to $166.3 million. Mobile sales slipped 7 percent as analog traffic fell. Revenue for its technology unit declined to $50.9 million from $53.7 million.
Third-quarter revenue for the company's international business, which includes Comsat World Systems, Comsat Mobile Communications and Comsat International Ventures, rose slightly to $120.1 million from $118.6 a year ago.
The offering would involve about $80 million of common stock. After the sale, the parent company would own 80 percent of the entertainment unit. Allen & Co. and Smith Barney Inc. are underwriting the offering.