WorldCom Rallies Despite Weak Quarter

The telecom company says its voice services continued to decline.

Author:: Michael Dunn
Publish date:: Apr 25, 2002 12:04 PM EDT

WorldCom

(WCOM)

shares rallied modestly Thursday even after the big telco missed first-quarter earnings and revenue estimates.

The stock added 17 cents to $3.65. WorldCom stock has lost nearly half its value over the last week as the company cut cash-flow expectations and investors worried anew about the company's massive debt overhang; the stock has lost some 70% of its value during 2002 amid the telecom sector's debt-driven meltdown.

Including charges, the company earned $184 million, or 6 cents a share, down sharply from $532 million, or 18 cents a share, a year ago. The company posted earnings, excluding charges, of $274 million, or 9 cents a share, down from $579 million, or 20 cents a share, in the year-ago period. Analysts polled by Thomson Financial/First Call had been expecting to see 11 cents a share.

Earnings before interest, taxes, depreciation, and amortization fell to $1.8 billion. Quarterly revenue dropped 2.4% to $5.08 billion from $5.20 billion a year ago, led by a drop in voice revenue. Analysts were looking for a top line of $5.13 billion. Data and Internet services revenue fell slightly.

WorldCom reiterated its

lowered guidance for 2002, saying it still expects to see full-year revenue of $21 billion to $21.5 billion and EBITDA of $7 billion to $7.5 billion.