40,000 new cellular subscribers for GT&T in one year
ATN reports higher profits
Stabroek News
October 26, 2002
The number of cellular phones hooked up with GT&T has risen almost three-fold in the past year and wireline subscribers by 8%, helping to boost the bottom line of its parent company Atlantic Tele-Network Inc.
There are now almost as many cellular phones in use (67,931) as landline connections (83,791), according to a Business Wire report out of St Thomas, US Virgin Islands.
According to figures for the third quarter of 2002, ATN reported earnings of US$2.7 million, or US$0.55 per share, for the third quarter ended September 30, 2002, an increase over first and second quarter earnings, which were US$2.0 million, or US$.40 per share and US$2.2 million, or US$.43 per share, respectively. Earnings for the three months ended September 30, 2001 were US$3.2 million, or US$0.65 per share. The ticker symbol for the publicly traded company is ANK.
The improvement was in part because of GT&T's local exchange service revenues increasing in the third quarter by US$890,000, or 14%, as a result of cellular subscribers growing from 57,048 in June 2002 to 67,931 in September 2002, a 19% increase in three months. Some of the increase was offset by expenses associated with expansion and development at Atlantic Tele-Centre, the Company's web-based call centre in Guyana.
ATN's international traffic revenues decreased by US$5.9 million, or 34%, as the international settlement rate for traffic from the U.S. to Guyana decreased from US$.85 per minute to US$.23 per minute effective January 1, 2002. The decrease in international long distance revenue was partially offset by an increase in local exchange service revenues of US$2.3 million, or 46%, due to increased cellular and wireline subscribers. Cellular subscribers increased from 25,862 at September 30, 2001 to 67,931 at September 30, 2002, an increase of over 162%, while wireline subscribers increased from 77,497 to 83,791, or 8%, for the same periods. Total telephone operating expenses were US$11.7 million for the third quarter of 2002 compared with US$12.8 million for the corresponding quarter of 2001, a decrease of US$1.1 million or 8%. This decrease was due primarily to reductions in international traffic expense of US$2.2 million, 49%, as the international settlement rate for traffic from Guyana to the U.S. decreased from US$.85 per minute to US$.23 per minute effective January 1, 2002. Partially offsetting the decrease in international long-distance expense was an increase of US$877,000, 13%, in telephone operating expense due to certain litigation expenses in the quarter and an increase in general and administrative expense of US$248,000, or 16%.
Cornelius B. Prior, Jr., Chairman of the Board and Chief Executive Officer of Atlantic Tele-Network, Inc. said, "I am pleased at GT&T's continuing profit improvement this year. As a result of the long anticipated reduction in settlement rates for international traffic which was mandated by the U.S. FCC to take effect in Guyana on January 1, 2002, GT&T's revenue from international traffic in the nine months ended September 30, 2002 declined by nearly 40% from the first nine months of the prior year. However thanks to the hard work of our dedicated staff at GT&T, GT&T's cellular subscribers have increased dramatically, with the result that our income from telephone operations and net income for the nine months are down only about 25% as compared to the same period in 2001. On the other hand, negotiations with the Government of Guyana have failed thus far to produce a rebalancing of local wireline rates needed to give us the 15% return on investment guaranteed by our 1990 contract with that Government."