July 23, 1996
CONTACT: David Frail, (212) 395-0500
NYNEX ANNOUNCES RECORD NET INCOME
- Continues Strong Earnings Growth -
NEW YORK, July 23, 1996 -- NYNEX Corporation (NYSE:NYN) today announced record
net income of $388.1 million for the second quarter, an increase of 11.8 percent
over $347.0 million in the second quarter of 1995 and the corporation's fifth
consecutive quarter of double-digit net income growth. Earnings per share of
$0.89 increased 9.9 percent over $0.81 per share in the second quarter of 1995.
Net income for the first six months of 1996, excluding a gain on the sale of an
investment, increased 15.1 percent to $749.6 million, compared to $651.0 million
in the first six months of 1995. Earnings per share were $1.72, up 12.4 percent
over $1.53 per share in the same period last year. Including the gain, net income
was $795.4 million, or $1.83 per share.
Driven by continued strong volume growth and unprecedented demand for access
lines, consolidated revenues increased 5.5 percent over the second quarter of
1995 to $3.4 billion. Bell Atlantic NYNEX Mobile (BANM) revenues, which are not
consolidated, grew 29.8 percent. Including NYNEX's share of revenues from BANM
and other unconsolidated businesses, total corporate revenue growth was 7.0
Operating margin for the quarter held steady at 21.8 percent, with operating
income rising 5.5 percent.
"Our results for the quarter were at the top end of our target range for steady,
long-term earnings growth of 7 to 10 percent," said NYNEX Chairman and Chief
Executive Officer Ivan G. Seidenberg, "and our first six months results position
us well to meet our financial goals for the year.
"At the same time, we continue to make progress toward completion of our merger
of equals agreement with Bell Atlantic. We have made filings with the appropriate
Federal and state regulatory bodies, and we are preparing the prospectus and
proxy statement to be issued to shareholders this fall.
"We have been very encouraged by the sustained strong volume growth in the
Northeast, which is creating jobs at NYNEX. During the quarter we began a program
to hire additional people to help handle the increased demand, and we are also
reinvesting savings from process re-engineering and other productivity
initiatives to reinforce our customer care and provisioning capabilities.
"We also made excellent progress in the quarter toward entering the long distance
market. We signed a unique agreement with Sprint that is helping us enter the
market quickly, economically and flexibly, and we expect to begin offering
services outside our region very shortly. We are completing the regulatory
process at the FCC and in several states, which will take us closer to offering
Other Results Of Second Quarter Operations
- Telecommunications revenue grew 2.5 percent over the second quarter of 1995,
as record demand for access lines and strong sales of other services more than
offset the impact of rate reductions made under state and FCC incentive
regulation plans. Value-added service revenues were up 40 percent over the second
quarter of 1995, and the number of ISDN lines in service increased more than 66
percent to 107,000. Private line service sales rose for the eighth consecutive
quarter, increasing 8.8 percent over the second quarter of 1995. Total access
minutes of use grew 9.6 percent. In the first full quarter of intraLATA
presubscription, NYNEX increased intrastate usage revenues 2.1 percent, despite
rate reductions of $33 million in New York and Massachusetts. NYNEX's innovative
New York calling plans, sales of which have more than doubled since January,
played a key role.
- Worldwide NYNEX access lines, including NYNEX's share of its unconsolidated
ventures, grew 5.0 percent over the second quarter of 1995. This increase
reflects the third consecutive record-setting quarterly gain in the Northeast,
where access lines increased 3.8 percent, or 635,000, to 17.5 million. Residence
second lines grew 11.5 percent, and business access line growth increased to 7.5
percent, including growth in Centrex sales of 17.3 percent. Overseas operations
and partnerships increased access lines 82.3 percent. NYNEX CableComms nearly
doubled the number of access lines in service and became the first company in the
United Kingdom to offer number portability, and TelecomAsias lines in service in
Bangkok rose 57 percent to 830,000.
- Strong growth in the number of worldwide cellular customers continued. Net
additions in the quarter at BANM of 247,000 customers increased the total number
of BANM subscribers to 3.8 million, up 39.3 percent over the second quarter of
last year. In addition, STET Hellas, NYNEXs wireless partnership in Greece, had
customer growth of 73.0 percent.
- Cable television subscriber growth at NYNEX CableComms was up nearly 55
percent over the second quarter of 1995, with the ratio of premium to basic units
improving more than 40 percentage points to 197 percent.
- Information services grew steadily, as the number of NYNEX Yellow Pages
advertisers increased 5.3 percent, including a 16 percent rise in international
advertisers. Use of BigYellow(sm), NYNEX Information Resources Companys national
on-line business directory, rose 50 percent, maintaining its leadership as one of
the most frequently referenced shopping directories on the Internet.
- As of June, FLAG (Fiberoptic Link Around the Globe), of which NYNEX is
managing sponsor, had placed more than 1,600 miles of the worlds longest undersea
fiber cable, completing the route from Italy to Egypt and beginning the legs from
Bombay, India to landing points in Malaysia and Thailand.
NYNEX is a global communications and media company that provides
a full range of services in the northeastern United States and
high-growth markets around the world, including the United Kingdom,
Thailand, Gibraltar, Greece, Indonesia, the Philippines, Poland,
Slovakia and the Czech Republic.
The Corporation is a leader in the telecommunications, wireless communications,
cable television, directory publishing
and entertainment and information services.
FAX copies of recent NYNEX news releases are available free of charge, 24
a day. Call 1-800-331-1214 and an automated system will provide