Summary
Verizon Communications Inc. filed an 8-K on December 1, 2009, to report on the progress of its agreement with Frontier Communications Corporation, initially announced on May 13, 2009. This transaction involves the divestiture of Verizon's local exchange and related business assets in 14 states. The filing provides summarized financial information for these divested operations for the three and nine months ended September 30, 2009, which were prepared for inclusion in Frontier's filings related to the transaction. Investors should note that these are separate financial statements prepared for a business not historically operated as a standalone entity. The disclosed financial data shows operating revenues of $1,007 million and $3,081 million for the respective three and nine-month periods, leading to net income of $44 million and $281 million. The filing also highlights capital expenditures of $129 million and $408 million for these periods. A key detail within operating expenses is the inclusion of significant pension settlement losses in the three and nine-month periods. The completion of this transaction is still subject to regulatory approvals.
Key Highlights
- 1Verizon is progressing with the sale of its local exchange and related assets in 14 states to Frontier Communications, as per the agreement announced in May 2009.
- 2Summarized financial results for the divested operations for the three and nine months ended September 30, 2009, are provided.
- 3Operating revenues for the divested segment were $1,007 million (3Q 2009) and $3,081 million (9M 2009).
- 4Net income for the divested segment was $44 million (3Q 2009) and $281 million (9M 2009).
- 5Capital expenditures for the divested operations amounted to $129 million (3Q 2009) and $408 million (9M 2009).
- 6The financial information includes pension settlement losses of $154 million and $293 million for the three and nine-month periods, respectively.
- 7Transaction closing remains contingent on receiving necessary regulatory approvals.