A headline in Saturday's editions of The Sun stated that Comcast Corp. had hired Merrill Lynch to study ways to increase its stock price and had reported a drop in operating earnings. In fact, it was Comsat Corp., a Bethesda-based satellite communications company, that hired Merrill Lynch and reported the financial results.
The Sun regrets the errors.
Comsat Corp., which has been trying desperately for more than a year to pump some vigor into its lagging shares, announced yesterday that it has hired Merrill Lynch & Co. to advise it on how to boost its stock price.
FOR THE RECORD - CORRECTION
The announcement came as Bethesda-based satellite communications company's fourth-quarter earnings report showed a one-third drop in operating income, helping to send the stock skidding $1.625 to close at $23.75 yesterday.
David Leibowitz, managing director of Burnham Securities in New York, said yesterday's drop in Comsat's stock was exacerbated by a downgrade in its rating by Smith Barney.
Comsat reported that it earned $16.9 million, or 35 cents a share, compared with $14.4 million, or 30 cents a share, in the final quarter of 1994.
However, 21 of those 35 cents were accounted for by the initial public offering of a minority stake in the newly spun off Ascent Entertainment Group.
Operating earnings fell to $20.3 million, from $30.1 million during last year's fourth quarter, as the entertainment businesses posted a $12.1 million loss and profits plunged from $15.8 million to $10 million in its mobile communications business. That business showed a 24 percent decline in revenues as competition cut margins in maritime phone service.
Total revenues for the quarter came in at $229.5 million, compared with $217.8 million the year-ago quarter.
Comsat's troubles have led to a bout of corporate introspection, culminating in the hiring of Merrill Lynch.
"We are examining all our lines of business with a view toward giving them the financial muscle they need to flourish in the years ahead," said Bruce Crockett, president and chief executive.