Press Release
08-07-07 - D&E COMMUNICATIONS REPORTS SECOND QUARTER 2007 RESULTS
D&E COMMUNICATIONS, INC. FOR IMMEDIATE RELEASE August 6, 2007 | FOR IMMEDIATE RELEASE CONTACT PERSON: |
EPHRATA, PENNSYLVANIA (August 6, 2007) - D&E Communications, Inc. ("D&E" or "Company") (Nasdaq: DECC), a leading provider of integrated communications services in central and eastern Pennsylvania, today announced the results of its operations for the second quarter ended June 30, 2007.
For the second quarter of 2007 the Company reported total operating revenues of $37.2 million, compared to $41.4 million in the second quarter of 2006. Operating income for the second quarter of 2007 was $6.5 million compared to operating income of $4.3 million in the second quarter of 2006. Net income for the second quarter of 2007 was $2.3 million, or $0.16 per share, compared to a net income of $0.9 million, or $0.06 per share, for the same period last year. The second quarter 2006 results were affected by the intangible asset impairment loss recognized in continuing operations of $1.9 million ($1.1 million, or $0.08 per share, after tax) and a loss from discontinued operations of $0.2 million, or $0.02 per share. Net income before these items was $2.2 million, or $0.16 per share, for the second quarter of 2006.
The revenue decrease of $4.2 million was primarily the result of a decline in directory revenue of $3.4 million, due to the terms of a directory contract which became effective in the fourth quarter of 2006 and which covers three of the four directories that we publish. Directory expenses decreased $3.1 million as a result of this contract, under which the responsibility for publication and distribution of the directory and the related financial risks became the responsibility of the publisher. As a result, our directory revenue, as the new directories that are covered by this contract are published, will only be the annual fee paid to the Company for access to our customers.
For the six months ended June 30, 2007, the Company reported total operating revenue of $75.6 million, as compared to $81.6 million in the same period last year. Net income for the six months ended June 30, 2007 was $4.9 million, or $0.34 per share, as compared to $2.5 million, or $0.18 per share, for the same period last year. Included in the 2007 results was a gain of $0.6 million ($0.6 million, or $0.04 per share, after tax) from life insurance proceeds. Included in the 2006 results was the customer relationships intangible asset impairment loss recognized in continuing operations of $1.9 million ($1.1 million, or $0.08 per share, after tax) and a loss from discontinued operations of $0.3 million, or $0.02 per share. Net income before these items was $4.3 million, or $0.30 per share, for the six months ended June 30, 2007, compared to $3.9 million, or $0.28 per share, for the six months ended June 30, 2006.
"Midway through 2007, we are pleased with our results. Delivering quality services is fundamental to our success and our results reflect the Company's ability to meet the needs of its customers," said James W. Morozzi, President and CEO of D&E Communications. "A highlight within our Wireline segment was an increase in DSL/high-speed Internet subscribers, as customers switched to faster service at a reasonable rate. D&E's six- month net-income growth, excluding significant one-time gains in 2007 and one-time losses in 2006, was solid. We are doing business in very active and attractive markets and working hard to Deliver Excellence to our customers."
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