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Storm and Pension Costs Leave Verizon With Bigger Loss

Verizon Communications is still adding plenty of customers and selling a lot of phones, but the impact from Hurricane Sandy and pension costs sank the company’s quarterly earnings.

The company on Tuesday reported a fourth-quarter loss of $4.22 billion, or $1.48 a share, more than double the loss a year ago. Damages from Hurricane Sandy cost 7 cents a share, and pension charges reduced earnings by $1.55 a share, Verizon said. Revenue climbed to $30.05 billion, a 5.7 percent increase compared with a year ago.

Analysts had expected adjusted earnings of 50 cents a share, compared to actual adjusted earnings of 45 cents a share, and revenue of $29.75 billion, according to Thomson Reuters.

“Verizon seized growth opportunities in the fourth quarter to cap a year of solid progress across the entire business,” said Lowell McAdam, chief executive of Verizon, in a statement. “We delivered a total return of 13.2 percent to shareholders in 2012, and we enter 2013 ready to accelerate the momentum we’ve achieved and create significant shareholder value in the years to come.”

The company, based in New York, said that its wireless business was growing. Over the quarter, it sold 9.8 million smartphones, compared with 7.7 million in the same quarter a year ago, and added 2.1 million contract subscribers, the most valuable type of customer, versus 1.2 million a year ago. The company said its new shared data plans helped increase the money it made from subscribers; average monthly revenue from each account grew 6.6 percent to $146.80.

Verizon Wireless, the largest American wireless carrier, is leading the race to build out its fourth-generation network, called LTE, which is faster and more efficient than its predecessor. The company has deployed LTE in 476 cities; ATT, the second-biggest American carrier, is in a distant second with 135 cities.

Article source: http://www.nytimes.com/2013/01/23/technology/storm-and-pension-costs-leave-verizon-with-bigger-loss.html?partner=rss&emc=rss

DealBook: Citigroup Profit and Revenue Decline for Quarter

Andrey Rudakov/Bloomberg NewsVikram S. Pandit, chief of Citigroup.

Citigroup reported an 11 percent drop in quarterly earnings on Tuesday, well below the Wall Street consensus, and revenue fell 7 percent, underscoring the industry’s slump in investment banking and slow growth in lending.

The profit for the fourth quarter was $1.16 billion, or 38 cents a share. Analysts had been expecting earnings of 50 cents a share, according to Zacks Investment Research. For the year, the bank reported earnings of $11.3 billion, compared with $10.6 billion in 2010.

Results in the year-ago period, when Citigroup posted profit of $1.3 billion, or 43 cents a share, had been helped by sizable accounting gains on the value of Citigroup debt, which were mostly absent from the fourth-quarter results for 2011.

The capital markets unit, which includes helping companies raise money and make deals, was especially weak; revenue in the division fell 10 percent, to $3.2 billion.

For the full year, Citigroup reported net income was up 6 percent from 2010, one measure of progress in the company’s slow but steady recovery under its chief executive, Vikram S. Pandit, who has been trying to transform Citi from a sprawling but shaky global banking giant into a stronger, more nimble corporate lender.

In the wake of the financial crisis, Citigroup required a $45 billion bailout from Washington, and while that has been paid back, Mr. Pandit is still in the process of shedding assets and lightening the bank’s balance sheet.

Net credit losses in the fourth quarter declined 40 percent, to $4.1 billion, from the period a year earlier, a sign that consumer conditions appeared to be getting stronger.

Like other battered financial giants, including Bank of America, Citigroup’s shares have been surging recently on hopes that the financial crisis in Europe might be easing and the economic recovery in the United States is gaining steam. Since the end of November, Citigroup’s shares have risen from below $25 to just over $30.

Despite the optimism among investors, Mr. Pandit sounded a note of caution.

“The current environment is certainly challenging,” he said in a letter to employees. “We’ve shown that we can weather a tough environment without investors, regulators and other observers questioning our safety and soundness.”

Article source: http://feeds.nytimes.com/click.phdo?i=695846e45910e35ccf953050afe6632e

Storm and Pension Costs Leave Verizon With Bigger Loss

DealBook: Citigroup Profit and Revenue Decline for Quarter

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