By Crayton Harrison
Aug. 1 (Bloomberg) -- Qwest Communications International Inc., provider of phone service in 14 western U.S. states, said second-quarter profit doubled as it cut costs on routine repairs and installations.
Net income climbed to $246 million, or 13 cents a share, from $117 million, or 6 cents, a year earlier, Denver-based Qwest said today in a statement. Sales fell less than 1 percent to $3.46 billion, missing the average of 12 estimates compiled by Bloomberg.
Chief Executive Officer Richard Notebaert, who will leave after he finds a successor, helped cut operating costs 4.2 percent by standardizing how technicians add Internet connections. Qwest posted a profit in 2006, following two years of losses, by trimming almost 1,300 jobs and paring spending.
``We expect a strong second half from the company,'' UBS AG analyst John Hodulik said in an interview before earnings were announced. ``The stock's gotten beaten up'' because of fears about profit margins and Notebaert's departure. The New York- based analyst rates the shares ``buy'' and doesn't own any.
Shares of Qwest fell 11 cents to $8.53 yesterday at 4:02 p.m. in New York Stock Exchange composite trading. The stock has dropped 16 percent since June 11, the day Notebaert said he would quit.
Per-share profit trailed the 15-cent average estimate of analysts. Their average projection for sales was $3.47 billion.
Qwest added 100,000 high-speed Internet customers in the quarter and lost about 279,000 phone lines. That compares with Hodulik's estimate of 100,000 new broadband customers and a loss of 276,000 lines.
The company had about 38,000 employees at the end of 2006.
To contact the reporter on this story: Crayton Harrison in Dallas at tharrison5@bloomberg.net.
Last Updated: August 1, 2007 07:07 EDT
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