FOR IMMEDIATE RELEASE
July 18, 1996
ATLANTIC ANNOUNCES RECORD EARNINGS
Philadelphia -- Propelled by strong business volumes across
its core wireline and wireless communication businesses, Bell
Atlantic Corporation (NYSE: BEL) announced record* net income
of $494.3 million for the second quarter of 1996, 10.6 percent
higher than in the same period in 1995. Earnings per share grew
9.8 percent, to $1.12 from $1.02.
Revenues from the company's core businesses, including its proportionate
share of Bell Atlantic NYNEX Mobile revenues, grew nearly 7 percent
compared with the second
quarter of 1995. Results for the quarter
included significant start-up costs in the company's long-distance,
video and Internet businesses as well as costs associated with
compliance with the Telecommunications Act of 1996.
"We're in excellent shape to meet our key financial goals
for the year," said Bell Atlantic Chairman and Chief Executive
Officer Raymond W.
Smith. "Our core business is producing
solid bottom-line growth while we build long-term capabilities
for continued growth in a fully competitive environment."
*Excludes third-quarter 1995 gain from the sale of
certain cellular properties
Despite significant price reductions taken to fortify the company's
competitive position in the switched access market, Bell Atlantic's
core Network revenues were 4.5 percent higher in the second quarter
compared with the same period in 1995.
- Access lines in service on June
30, 1996, totaled 20.1 million, up 3.5 percent over the last 12
months. The increase includes 11.2 percent Centrex line growth
in the business markets.
- Access minutes of use grew 9.2
- At June 30, Bell Atlantic had
approximately 170,000 ISDN
(integrated services digital network)
lines in service, 40 percent higher than a year ago.
"Due to strong volumes and robust demand for value-added
services, we're on track to achieve our goal of 5 percent Network
revenue growth for the year," said Bell Atlantic Vice Chairman
James G. Cullen.
"With our aggressive marketing of additional lines, Answer Call,
Caller ID and new service packages such as
we're already achieving 5 percent growth in the
consumer market. Our launch of new products such as Easy Voice SIZE=1>SM,
our filings to
significantly reduce residential ISDN rates, and
our soon-to-be-introduced consumer "http://www.bell-atl.com/internet/">Internet access services, all
promise to help build on that momentum."
- growth in home computer use and increasing family communication
needs, sales of "http://www.bell-atl.com/consumer/addlines/">secondary residential
telephone lines totaled more than 212,000 for the second quarter,
to 14.2 percent, up from 10.3 percent a year ago.
- Revenues from
"http://www.bell-atl.com/customer/consumer/services/call/answer.htm">Answer Call and
central-office-based services such as "http://www.bell-atl.com/customer/consumer/services/call/id.htm">Caller
ID and "http://www.bell-atl.com/customer/consumer/services/call/waiting.htm">Call Waiting
grew almost 25 percent compared with second-quarter 1995 results.
Caller ID registered its highest quarterly growth ever, with
revenues more than doubling year-earlier levels. By the end of
the period, Caller ID subscribers exceeded 2 million, with penetration
at 16.5 percent, up from 8.8 percent a year ago.
- Since its introduction in June, 1996,
"http://www.bell-atl.com/ezvoice/">Easy Voice voice-activated
dialing has averaged 1,000 new customers per day.
"In the business markets, Bell Atlantic's leadership in
network integration and Fast-Packet services is expanding our
presence among our larger customers," Cullen said, "while
our innovative service packaging is redefining how the needs of
small businesses are addressed."
- Bell Atlantic's successful line
of feature-rich service packages that allow "http://www.bell-atl.com/sbs/">small businesses to
custom-design their communication systems posted revenues of $39.7
million for the quarter, up more than 100 percent above year-ago
- Among Bell Atlantic's large
customers, revenues from high-speed "http://www.bell-atl.com/carrier/html/cs05eufp.htm">Fast-Packet data
were up about 150 percent.
- As a member of the
Alliance global partnership,
Bell Atlantic Network Integration was awarded a seven-year, $250 million
contract to support J.P. Morgan's distributed computing systems
-- local area networks, desktop computers and servers.
- Second-quarter revenues from
"http://yellowpages.badg.com/">Directory Services grew 4.3 percent
compared with 1995 results as Bell Atlantic continues expanding
its presence in the electronic publishing arena with products
such as "http://www.bell-atl.com/customer/consumer/infotrav.htm">InfoTravelTM.
Bell Atlantic reported Network operating expenses for the second
quarter totaling $2.4 billion, 4.5 percent higher than in the
1995 period. Adjusting for increased new-business start-up expenses
for long-distance, Internet and video, expenses increased 3.8
percent. Growth in expenses also reflected high business volumes
and increased outlays for marketing, systems and software upgrades,
and compliance with the Telecommunications Act's competitive
- Bell Atlantic continued to achieve operating efficiency gains,
as access lines per network employee increased to 365 from 327
as of June 30, 1995, an improvement of 11.6 percent.
- Cash expenses per access line
were $321, up less than one percent from year-ago levels. That
increase is attributable primarily to higher volumes and weather-related
Equity income from Bell Atlantic's wireless investment portfolio
of 85 million worldwide POPs (people in markets served) increased
nearly 26 percent compared with second-quarter 1995 results.
Included was a nearly 30 percent increase in income from "http://www.banm.com">Bell
Atlantic NYNEX Mobile. Also reflected were costs related to development
activities in the company's domestic PCS (personal communications
services) partnership, the acquisition of customers by its wireless
consortium in Italy, and the launch of digital GSM (global service
for mobile) by its partnership in the Czech Republic. Largely
offsetting these costs were reduced amortization expenses associated
with Bell Atlantic's investment in Grupo Iusacell, S.A. de C.V.
"Wireless has become one of the premier growth engines in
the communication industry," said Bell Atlantic Vice Chairman
Lawrence T. Babbio,
Jr. "And in many ways we're still revving
it up. Our domestic cellular business is posting some of the
highest growth numbers in the industry, with plenty of headroom
for more growth. Later this year, PrimeCo Personal Communications
will launch service in its major markets. And in Italy, Omnitel's
growth rate is off the charts."
The following "http://www.ba.com/nr/96/jul/2qreslts.htm#banm">second-quarter highlights
of Bell Atlantic NYNEX
Mobile, which began operations on July 1, 1995, contain comparative
financial and operating statistics derived as if the joint venture
had existed in the second quarter of 1995.
- Bell Atlantic NYNEX Mobile added
247,000 new subscribers, 23,000 more than in the second quarter
of 1995, representing annual subscriber growth of more than 39
percent. Subscribers as of June 30, 1996, totaled 3.8 million.
- Operating revenues grew $145.1
million, or 29.8 percent, to $631.6 million.
- Operating cash flow margin was
43 percent, up from 40 percent in the second quarter of 1995,
resulting in a 37 percent increase in operating cash flow.
- Since launching commercial service
in December, 1995, Omnitel Pronto Italia, Bell Atlantic's consortium
operating the second wireless license in Italy, has "http://www.ba.com/nr/96/jul/omni3000.htm">acquired more
than 300,000 subscribers to its GSM service.
- On July 1, 1996, EuroTel, Bell
Atlantic's partnership currently serving about 72,000 customers
in the Czech Republic and Slovakia, launched "http://www.ba.com/nr/96/jul/7-1euro.htm">the first digital
GSM service in the Czech Republic.
"Results from the second quarter give Bell Atlantic added
momentum as we approach a new era of open markets, full competition
and unprecedented opportunity," Smith concluded. "Our
network business is in a growth renaissance, our wireless growth
is pacing the industry and significant new businesses will soon
be hitting their stride. We have a very exciting future ahead."
Bell Atlantic Corporation (NYSE: BEL) is at the forefront of the
new communications, entertainment and information industry. In
the mid-Atlantic region, the company is the premier provider of
local telecommunications and advanced services. Globally, it
is one of the largest investors in the high-growth wireless communication
marketplace. Bell Atlantic also owns a substantial interest in
Telecom Corporation of New Zealand and is actively developing
high-growth national and international business opportunities
in all phases of the industry.