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SureWest 4Q Loss Widens On Higher Costs

The Associated Press

ROSEVILLE, Calif. (AP) — SureWest Communications on Thursday reported that its fourth-quarter loss widened from a year ago, as higher operating and interest costs outpaced growth in revenue that mainly came from an acquisition.

The Roseville, Calif.-based phone company, which also provides TV and high-speed Internet service, lost $2.1 million, or 15 cents per share, compared with $535,000, or 4 cents per share, in the same quarter of the prior year.

Revenue rose by 35 percent to $58.9 million, propelled by a doubling of its broadband business in TV and Internet to $37 million that reflects the February 2008 purchase of Everest Broadband Inc. Telecom revenue, however, fell by 16 percent.

The loss from continuing operations was $1.55 million, or 11 cents per share, compared with a loss of $36,000, or less than a penny per share.

Analysts polled by Thomson Reuters expected a profit of 7 cents per share, on average. The consensus estimate typically excludes one-time items.

Assuming that the Everest's operations were included in the fourth quarter of 2007, SureWest said it would have seen no revenue growth year-over-year. Broadband revenue would have risen by 12 percent while telecom revenue would have fallen 16 percent.

For the year, SureWest earned $18.9 million, or $1.34 per share, compared with $62.9 million, or $4.34, a year ago. Both periods had gains from the sale of assets, but 2007 had a greater gain of $60.2 million. Revenue rose 32 percent to $230.4 million.

Including Everest's operations for 2007, revenue would have risen by 2 percent.

Shares of SureWest fell 45 cents, or 4.4 percent, to $9.75 in midday trading.