UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 21, 1998
ALLTEL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-4996 34-0868285
(State or Other (Commission File Number) (I.R.S. Employer
Jurisdiction of Identification
Incorporation No.)
or Organization)
One Allied Drive, Little Rock, Arkansas 72202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (501) 905-8000
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 5. Other Events
On April 21, 1998, ALLTEL Corporation issued a Press Release
announcing the first quarter results for ALLTEL Corporation and its
subsidiaries. A copy of the Press Release is attached hereto as Exhibit 99.1
and made a part hereof.
Item 7. Financial Statements and Exhibits
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
Exhibit 99.1 Press Release, dated April 21, 1998 of
ALLTEL Corporation
2
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
ALLTEL CORPORATION
(Registrant)
By: /s/ Dennis J. Ferra
Dennis J. Ferra
Senior Vice President and Chief Financial Officer
April 21, 1998
3
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description of Exhibits
99.1 Press Release of ALLTEL Corporation, dated April 21, 1998.
4
For additional information contact: Shawne S. Leach, 501-905-8991
Vice President-Investor Relations
George Smith, 501-905-8117
Vice President-Media Services
email: [email protected]
Release date: April 21, 1998
ALLTEL REPORTS FIRST QUARTER EARNINGS GROWTH
OF 12 PERCENT FROM CURRENT BUSINESSES
FOR IMMEDIATE RELEASE
LITTLE ROCK, Ark. -- ALLTEL today announced first quarter 1998 results from
current businesses: quarterly revenues and earnings per share grew 13 percent
and 12 percent, respectively, to $847 million and 55 cents per share.
Quarterly results were boosted by strong gains in its long-distance business
as well as the fourth consecutive quarter of double-digit revenue growth in
its information services business.
Among the highlights from current businesses in the first quarter:
Earnings per share grew 12 percent from a year ago, to 55 cents per
share.
The number of ALLTEL long-distance customers increased to 315,300 and
has more than doubled since the year-ago period.
Wireless operations produced better than expected customer growth,
adding a record 102,000 gross units in the quarter.
Access line growth exceeded 6 percent.
ALLTEL implemented digital wireless service in its first PCS market,
Jacksonville, Fla.
Revenues from information services increased at double-digit rates,
reflecting additional business from new and existing customers.
Revenues and operating income from current businesses for the first
quarter were $846,962,000 and $191,547,000, up 13 percent and 6 percent,
respectively, from the previous year.
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<PAGE>
1st Quarter Earnings
Page 2
Joe Ford, ALLTEL chairman and chief executive officer, said, "We were
pleased with quarterly results as we continued to deliver double-digit
earnings growth to our shareholders. Our integrated communications business
continued to exhibit good growth while rolling out new products and developing
an extended long-distance infrastructure to support future growth. In
addition, our information services business continues to sign new contracts
and expand services with existing customers.
"We are particularly pleased with our long-distance business which has
been in full operation since early 1997," Ford said. "Despite a formidable
competitive environment, we have brought this business to a profitable level
while doubling our number of customers over the past year. In addition, we
expect our extended fiber network -- which will be one of the largest fiber
networks in the southeast -- to be completed late this year, allowing us to
meet the growing demand for our local service, long distance, wireless,
Internet and information services.
"At the same time, we continue to sell our internet service and implement
competitive local exchange services in selected markets where ALLTEL has an
established presence and strong local distribution channels," he said.
"Wireless results were characterized by record growth in gross customer
additions accompanied by a corresponding rise in marketing expense. We would
expect to see the revenue and income contribution from these new customers in
future quarters. Churn improved in the quarter and revenue per customer
remained strong, declining only 3 percent year-over-year," Ford said.
Information services continued to produce double-digit growth in revenues
as it expanded existing relationships and signed new contracts, he said. "We
recently announced a major outsourcing agreement with Hughes-Ispat Ltd. --
valued at approximately $200 million over 10 years -- in which we will provide
outsourcing of the information technology function and the communications
operations function as well. This contract highlights the unique combination
of ALLTEL's communication and information service expertise," Ford said.
"Perhaps the most exciting event to occur in the first quarter was our
announcement to merge with 360 Communications Company, one of the
country's leading wireless companies. We continue to expect the merger to
close in the third quarter and are proceeding to obtain the necessary
regulatory approvals," he said.
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1st Quarter Earnings
Page 3
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ALLTEL is a customer-focused, information technology company that provides
wireline and wireless communications and information services.
* ALLTEL, NYSE: AT
www.alltel.com
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<CAPTION>
ALLTEL CORPORATION
HIGHLIGHTS
(Dollars in thousands, except per share amounts)
THREE MONTHS ENDED MARCH 31 TWELVE MONTHS ENDED MARCH 31
--------------------------- ----------------------------
Increase Increase
(Decrease) (Decrease)
FROM CURRENT BUSINESSES 1998 1997 Amount % 1998 1997 Amount %
---- ---- ------ - ---- ---- ------ -
<S> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUES AND SALES:
Wireline $334,447 $301,176 $ 33,271 11 $1,302,153 $1,180,444 $121,709 10
Wireless 140,629 124,117 16,512 13 559,238 491,073 68,165 14
-------- -------- -------- ---------- ---------- --------
Total communications 475,076 425,293 49,783 12 1,861,391 1,671,517 189,874 11
Information services 266,861 217,164 49,697 23 1,023,070 862,026 161,044 19
Product distribution 81,773 76,060 5,713 8 322,568 301,587 20,981 7
Other operations 23,252 34,258 (11,006) (32) 107,874 133,028 (25,154) (19)
-------- -------- -------- ---------- ---------- --------
Total revenues and sales $846,962 $752,775 $ 94,187 13 $3,314,903 $2,968,158 $346,745 12
======== ======== ======== ========== ========== ========
OPERATING INCOME:
Wireline $115,655 $105,901 $ 9,754 9 $ 456,204 $ 408,848 $ 47,356 12
Wireless 40,063 39,688 375 1 178,776 158,861 19,915 13
-------- -------- -------- ---------- ---------- --------
Total communications 155,718 145,589 10,129 7 634,980 567,709 67,271 12
Information services 36,863 33,664 3,199 10 148,421 141,905 6,516 5
Product distribution 3,581 3,278 303 9 12,787 14,991 (2,204) (15)
Other operations 1,758 2,928 (1,170) (40) 7,618 11,755 (4,137) (35)
-------- -------- -------- ---------- ---------- --------
Total business segments 197,920 185,459 12,461 7 803,806 736,360 67,446 9
Corporate expenses 6,373 5,373 1,000 19 29,920 24,830 5,090 20
-------- -------- -------- ---------- ---------- --------
Total operating income $191,547 $180,086 $ 11,461 6 $ 773,886 $ 711,530 $ 62,356 9
======== ======== ======== ========== ========== ========
Net income $101,278 $ 91,830 $ 9,448 10 $ 408,345 $ 367,300 $ 41,045 11
Preferred dividends 240 258 (18) (7) 990 1,055 (65) (6)
-------- -------- -------- ---------- ---------- --------
Net income applicable to
common shares $101,038 $ 91,572 $ 9,466 10 $ 407,355 $ 366,245 $ 41,110 11
======== ======== ======== ========== ========== ========
BASIC EARNINGS PER
AVERAGE COMMON SHARE
OUTSTANDING $.55 $.49 $.06 12 $2.20 $1.94 $.26 13
<FN>
From current businesses excludes the sold healthcare, wire and cable operations, the provision to reduce carrying value of certain
assets, and gain on disposal of assets.
</FN>
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<TABLE>
<CAPTION>
ALLTEL CORPORATION
HIGHLIGHTS-Page 2
(Dollars in thousands, except per share amounts)
THREE MONTHS ENDED MARCH 31 TWELVE MONTHS ENDED MARCH 31
--------------------------- ----------------------------
Increase Increase
Decrease) (Decrease)
1998 1997 Amount % 1998 1997 Amount %
---- ---- ------ - ---- ---- ------ -
<S> <C> <C> <C> <C> <C> <C> <C> <C>
AS REPORTED:
Revenues and sales $846,962 $784,305 $62,657 8 $3,326,220 $3,202,457 $123,763 4
Operating income $191,547 $181,225 $10,322 6 $757,346 $601,685 $155,661 26
Net income $123,551 $101,708 $21,843 21 $529,729 $309,372 $220,357 71
Basic earnings per share $.67 $.54 $.13 24 $2.85 $1.63 $1.22 75
COMMON SHARES:
Weighted average for period 184,074,000 186,841,000 (2,767,000) (1) 185,367,000 188,648,000 (3,281,000) (2)
End of period 184,310,000 186,544,000 (2,234,000) (1)
Current annual dividend rate per
common share $1.16 $1.10 $.06 5
Capital expenditures $100,346 $145,351 ($45,005) (31) $500,568 $506,186 $(5,618) (1)
Total assets $5,842,984 $5,227,170 $615,814 12
Wireline access lines 1,821,170 1,707,877 113,293 7
Wireless customers 976,769 843,658 133,111 16
Long-distance customers 315,309 154,265 161,044 104
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<TABLE>
<CAPTION>
ALLTEL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
THREE MONTHS ENDED MARCH 31 TWELVE MONTHS ENDED MARCH 31
--------------------------- ----------------------------
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES AND SALES:
Service revenues $717,934 $625,814 $2,793,027 $2,543,613
Product sales 129,028 158,491 533,193 658,844
-------- -------- ---------- ----------
Total revenues and sales 846,962 784,305 3,326,220 3,202,457
-------- -------- ---------- ----------
COSTS AND EXPENSES:
Operations 446,192 392,282 1,740,649 1,611,582
Cost of products sold 84,080 104,070 342,174 444,059
Depreciation and amortization 125,143 106,728 469,177 424,851
Provision to reduce carrying value of
certain assets - - 16,874 120,280
-------- -------- ---------- ----------
Total costs and expenses 655,415 603,080 2,568,874 2,600,772
-------- -------- ---------- ----------
OPERATING INCOME 191,547 181,225 757,346 601,685
Other income, net 5,141 (573) 10,950 1,806
Interest expense (33,499) (32,002) (131,678) (128,624)
Gain on disposal of assets and other 36,584 16,216 226,990 16,216
-------- -------- ---------- ----------
Income before income taxes 199,773 164,866 863,608 491,083
Income taxes 76,222 63,158 333,879 181,711
-------- -------- ---------- ----------
Net income 123,551 101,708 529,729 309,372
Preferred dividends 240 258 990 1,055
-------- -------- ---------- ----------
Net income applicable to common shares $123,311 $101,450 $ 528,739 $ 308,317
======== ======== ========== ==========
EARNINGS PER SHARE:
Basic $.67 $.54 $2.85 $1.63
Diluted $.66 $.54 $2.83 $1.62
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<TABLE>
<CAPTION>
ALLTEL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
ASSETS
MARCH 31, DEC. 31, MARCH 31,
1998 1997 1997
---- ---- ----
<S> <C> <C> <C>
CURRENT ASSETS:
Cash and short-term investments $ 36,243 $ 16,212 $ 28,266
Accounts receivable (less allowance for
doubtful accounts of $19,301, $18,562
and $21,376, respective) 529,664 560,928 504,878
Materials and supplies 17,491 14,237 17,893
Inventories 45,018 51,277 83,434
Prepaid expenses 34,658 23,190 29,984
---------- ---------- ----------
Total current assets 663,074 665,844 664,455
---------- ---------- ----------
Investments 987,485 775,647 736,401
Goodwill and other intangibles 608,161 606,484 438,044
PROPERTY, PLANT AND EQUIPMENT:
Wireline 4,122,004 4,068,502 3,794,874
Wireless 703,229 692,490 611,317
Information services 553,538 539,743 481,190
Other 11,488 11,008 24,132
Under construction 221,579 218,951 256,675
---------- ---------- ----------
Total property, plant and equipment 5,611,838 5,530,694 5,168,188
Less accumulated depreciation 2,434,664 2,340,242 2,085,804
---------- ---------- ----------
Net property, plant and equipment 3,177,174 3,190,452 3,082,384
---------- ---------- ----------
Other assets 407,090 395,018 305,886
---------- ---------- ----------
TOTAL ASSETS $5,842,984 $5,633,445 $5,227,170
========== ========== ==========
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ALLTEL CORPORATION
CONSOLIDATED BALANCE SHEETS - Continued
(Dollars in thousands)
LIABILITIES AND SHAREHOLDERS' EQUITY
MARCH 31, DEC. 31, MARCH 31,
1998 1997 1997
---- ---- ----
CURRENT LIABILITIES:
Current maturities of long-term debt $ 44,188 $ 48,028 $ 40,331
Accounts payable 215,178 237,865 213,422
Advance payments and customer deposits 102,679 84,215 67,371
Accrued taxes 127,806 74,681 112,643
Accrued dividends 55,155 55,012 52,176
Other current liabilities 124,970 137,480 145,965
---------- ---------- ----------
Total current liabilities 669,976 637,281 631,908
---------- ---------- ----------
Long-term debt 1,747,297 1,874,172 1,698,913
Deferred income taxes 768,780 665,473 600,693
Other liabilities 237,330 242,388 236,263
Preferred stock, redeemable 5,592 5,625 6,413
SHAREHOLDERS' EQUITY:
Preferred stock 9,142 9,155 9,196
Common stock 184,310 183,673 186,544
Additional capital 163,167 152,936 258,219
Unrealized holding gain on investments 425,498 300,671 285,976
Retained earnings 1,631,892 1,562,071 1,313,045
---------- ---------- ----------
Total shareholders' equity 2,414,009 2,208,506 2,052,980
---------- ---------- ----------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $5,842,984 $5,633,445 $5,227,170
========== ========== ==========
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