CommScope Warns on Earnings

The cable supplier sees strong revenue but adds that margins are being squeezed.

Author:: TSC Staff
Publish date:: Jan 24, 2005 4:36 PM EST

Cable supplier

CommScope

warned Monday that it would miss fourth-quarter earnings estimates, hampered by rising costs and an unfavorable product mix.

Shares in the Hickory, N.C., company slid 6% in after-hours trading on the company's guidance for the quarter ended Dec. 31.

CommScope said fourth-quarter revenue would beat estimates, coming in at around $295 million, up from the previous $277 million view. But the company said it now expects to break even in the period, excluding restructuring charges. That news disappointed investors who had expected a 7-cent-a-share profit.

"While our overall fourth-quarter revenue performance was stronger than expected, we are disappointed with our margin performance," finance chief Jearld Leonhardt said. "Our results were negatively affected by a number of items including higher-than-expected material and freight costs, an unfavorable product mix and higher period spending, among others."

The company said it will release full fourth-quarter numbers and update 2005 guidance on Feb. 24.

Late Monday, CommScope slipped 94 cents to $15.84.