Verizon loses $2.8M for quarter
By Frank Cho
Advertiser Staff Writer
Verizon Hawaii Inc., the state's biggest provider of local telephone service, said it lost nearly $3 million in the third quarter because of a $20.8 million pension settlement loss, millions in uncollected debt from WorldCom and other carriers, and rising operating costs.
The company, formerly GTE Hawaiian Tel, reported a net loss of $2.8 million for the three months through Sept. 30, compared with a net gain of $17.7 million for the same quarter last year.
Third-quarter revenues of $134.9 million were down from $135.43 million a year earlier, according to the company's filing with the Securities & Exchange Commission this week.
Ann Nishida, a spokeswoman for Verizon, said demand for business services remain strong but it was not enough to offset losses in other areas.
Profits from local telephone services decreased during the quarter primarily because of lower demand for basic wireline services. Switched access lines in service declined 1.5 percent from a year ago, reflecting the impact of the state's economic slowdown and increased competition, the company said.
For the first three quarters of 2002, Verizon Hawaii reported net income of $23.6 million compared to net income of $50.3 million for the same period in 2001.
As of Sept. 30, approximately 60 management and associate employees have been taken off the payroll under the 2001 and 2002 severance programs.
The remaining severance liability relating to these programs is $1.8 million, which includes future payments to employees separated as of Sept. 30.
Verizon said it expects to complete the severance programs within the next year.
For the nine months that ended in September, Verizon Hawaii said revenue from local telephone services fell $21.9 million to $205 million from $226.9 million for the same period last year.
Operating revenues for long-distance services fell to $5.2 million, down from $12.3 million a year ago, primarily because the company transferred much of its assets to its parent company.
