Qwest Returns To Profitability - InformationWeek

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Qwest Returns To Profitability

The telecom company earned $150 million in the first quarter after a huge loss in same period a year earlier

DENVER (AP) -- Qwest Communications International Inc. returned to profitability in the first quarter in contrast to a mammoth loss a year ago despite a decline in revenue.

The telecommunications company, which is under investigation by federal authorities over accounting practices, said Thursday it earned $150 million, or 9 cents per share, in the three months ended March 31.

The company lost $23.9 billion, or $14.32 per share, a year ago. The loss included a $23.1 billion charge related to a required accounting change involving goodwill.

The latest results included a $206 million gain for Qwest's adoption of an accounting standard related to its pension obligations.

Revenue fell 9.4 percent to $3.63 billion from $4.01 billion a year ago.

Qwest, like others in the industry, is watching revenues drop amid competition from wireless providers, cable companies, smaller competitors and others.

The Securities and Exchange Commission and Justice Department have been investigating the company's accounting practices, and Qwest has been reauditing its books.

Qwest has yet to file a financial report for 2002 while it works to restate 2000 and 2001 results. Its latest deadline for reporting 2002 results to lenders is July 15, extended from May 15.

Qwest is the dominant local phone service provider in 14 Western states. It is gradually regaining its long-distance business throughout the region, which would allow it to offer its customers local, long-distance, mobile, and Internet service.

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