MCI WorldCom (Nasdaq: WCOM) posted a fourth-quarter profit of 42 cents a share Thursday, topping First Call's expected profit of 41 cents a share. Double-digit revenue gains bolstered profits as MCI WorldCom benefited from declining access costs from regulatory restructuring, the company said.
Shares closed Wednesday at 48 1/8, after continuing their dip in January after concern about lower revenue started a downward trend in the late fall, following the company's announcement it would merge with Sprint.
Fourth quarter revenue was $9.6 billion, compared with $9.1 billion a year ago. More than 80 percent of that revenue growth came from data, Internet and international services.
Net income, after goodwill amortization, was $1.3 billion, or 44 cents per common share. Net income, excluding net gain items of $112 million before tax, or $64 million after tax was $1.2 billion, or 42 cents per common share.
MCI WorldCom also reported results for the year; net income, after goodwill amortization, was $3.9 billion, or $1.35 per common share, and net income, excluding net gain items of $87 million after tax, was $3.9 billion, or $1.32 per common share.
MCI WorldCom now receives 40 percent of communications services revenue from high growth areas such as data, Internet and international services. Revenue in 1999 was $37 billion, with more than $15 billion from high-growth data, Internet and international services.
The company's investments have positioned it to post industry leading incremental revenue gains, in spite of expected pressures on voice revenues -- related to the long anticipated reduction or elimination of access payments to the ILECs, (Incumbent Local Exchange Carrier) said president and CEO Bernard J. Ebbers in a press release. As payments to ILECs reduced, billions of dollars in savings are being passed through to customers with no impact to its profitability the company said.