Qwest chief executive Richard Notebaert said Tuesday that the company narrowed its third- quarter losses and could cross over into profitability next year.
“We are not only on track to meet our goals, but we are gaining momentum,” Notebaert said in a conference call with analysts. “We improved performance (and) free cash flow, invested in growth and value for our constituents and continued to make steady and demonstrable performance achievements.”
Denver-based Qwest, the country’s fourth-largest local telephone company, said it lost $144 million, or 8 cents a share, in the third quarter. That compares with a $569 million loss, or 31 cents a share, in the third quarter of 2004.
Revenues rose to $3.5 billion, which was close to estimates. That compares with $3.45 billion in revenue for the same quarter last year.
An analysis by Simon Flannery, a telecom analyst at Morgan Stanley, said Qwest’s revenues were helped by a $52 million government contract.
Qwest said the quarter was its sixth consecutive quarter of stable revenues.
Notebaert said Qwest continues to look for acquisitions that make sense. Earlier this year, it lost a bidding war with Verizon to purchase long-distance provider MCI. Federal regulators Monday gave the go-ahead to the Verizon-MCI merger, as well as a merger between SBC and AT&T.
“We continue to review any and all opportunities, but they must make sense strategically,” Notebaert said. “We will take advantage of industry consolidation, but only if it meets our criteria.”
Qwest reported losing 145,000 access-line customers in the third quarter, a smaller-than-expected loss, according to Flannery’s report. The company also dropped 3,000 workers from the payroll.
Notebaert said the company was pushing hard to speed up DSL Internet line installation.
Qwest said later in a statement that it would consolidate an existing $3 billion in debt and look to raise another $1 billion.
The company provides local phone service in 14 Western states. Its stock closed at $4.35 Tuesday, down 1 cent.
Staff writer Beth Potter can be reached at 303-820-1503 or bpotter@denverpost.com.
