Summary
MetroPCS Communications, Inc. (operating as T-Mobile US, Inc. in the contemporary market) reported its financial results for the quarter ending June 30, 2009. The company demonstrated significant top-line growth, with total revenues increasing by 28% year-over-year to $859.6 million, driven by a substantial 28% rise in service revenues to $766.9 million. This growth was fueled by customer additions in both its established 'Core Markets' and its newly launched 'Northeast Markets'. However, profitability was impacted by increased operating expenses, particularly in the Northeast Markets due to launch costs, and higher interest expenses stemming from new debt issuances. Despite the revenue growth, net income for the quarter saw a significant decline of 48% to $26.2 million, compared to $50.5 million in the prior year. This decline was largely due to a substantial increase in interest expense (54%) and a decrease in interest and other income. The company's balance sheet shows growth in assets, particularly property and equipment and FCC licenses, alongside an increase in long-term debt. The company highlighted its ongoing network expansion efforts and management's confidence in its liquidity and ability to fund future operations, despite market volatility.
Financial Highlights
31 data points| Revenue | $859.61M |
| Cost of Revenue | $227.40M |
| Gross Profit | $632.21M |
| SG&A Expenses | $142.32M |
| Operating Expenses | $743.84M |
| Operating Income | $115.77M |
| Interest Expense | $70.53M |
| Net Income | $26.20M |
| EPS (Basic) | $0.14 |
| EPS (Diluted) | $0.14 |
| Shares Outstanding (Basic) | 175.96M |
| Shares Outstanding (Diluted) | 178.54M |
Key Highlights
- 1Total revenues grew 28% year-over-year to $859.6 million, primarily driven by service revenue growth of 28% to $766.9 million.
- 2The company experienced significant customer additions, with total customers reaching 6.26 million by June 30, 2009, a 36% increase year-over-year.
- 3Net income declined by 48% to $26.2 million for the quarter, compared to $50.5 million in Q2 2008, largely due to increased interest expenses and higher operating costs associated with market expansion.
- 4Long-term debt increased, with the company issuing $550 million in new 9 1/4% Senior Notes in January 2009.
- 5Capital expenditures remained substantial, with $455.1 million invested in the first six months of 2009, primarily for network infrastructure and expansion into new markets.
- 6The company reported a decline in ARPU (Average Revenue Per User) to $40.52 from $42.05 year-over-year, attributed to higher participation in Family Plans and changes in service plan structures.
- 7The company is actively managing its interest rate risk through derivative instruments, holding a total fair value of approximately $37.2 million in interest rate protection agreements as of June 30, 2009.