Summary
Verizon Communications Inc. (VZ) filed an 8-K on January 12, 2009, reporting on an update provided by its CEO, Ivan Seidenberg, at the Citigroup Global Entertainment, Media and Telecommunications Conference on January 7, 2009. The report focused on the company's outlook for sustained organic growth and its strategic initiatives. Key takeaways included revised financial expectations for 2008 and an optimistic view for 2009, highlighting expected growth in consolidated revenues and earnings. The company also provided segment-specific guidance, anticipating flat to slightly lower revenues for Verizon Business in the first half of 2009, while reiterating long-term margin targets for its wireline segment. Furthermore, Verizon emphasized the strategic importance and expected synergies from its recent acquisition of Alltel, signaling continued investment in its wireless segment.
Key Highlights
- 1Verizon estimates 2008 earnings from continuing operations before special items to grow in the 7% to 8% range.
- 2The company expects to increase consolidated revenues and ARPU (Average Revenue Per User) in 2009.
- 3Earnings from continuing operations before special items are also projected to grow in 2009.
- 4Verizon Business revenues are expected to be flat or slightly lower in the first half of 2009 compared to the same period in 2008.
- 5Long-term wireline EBITDA margins are reiterated to be in the 30-33% range.
- 6Capital expenditures for 2008 are expected to be less than $17.5 billion, including integration costs for Rural Cellular.
- 7Verizon Wireless expects over $9 billion in net present value of synergies from the acquisition of Alltel Corporation.