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ACS reports 4th quarter loss

Posted: Friday, February 23, 2001

ANCHORAGE (AP) -- Alaska Communications Systems on Thursday reported fourth-quarter losses of $8.5 million and full-year losses of $25.2 million, greater than some analysts had expected.

The Anchorage-based phone company's fourth-quarter loss compares with a loss of $14.8 million.

The company posted quarterly revenue of $79.2 million compared with $79.3 million a year ago.

About $3.2 million of the losses stemmed from ''unusual charges'' of severance, a legal settlement and restructuring plans, said Kevin Hemenway, ACS' chief financial officer.

For the year, ACS' losses of $25.2 million came on $313 million in revenue.

The company began operating in the spring of 1999 when it took over phone companies in Anchorage, the Kenai Peninsula, Fairbanks, Juneau and about 70 other Alaska communities.

ACS said it saw growth in its long-distance and local phone and Internet services in 2000, even though in the fourth quarter it experienced a $3.7 million decline in local phone revenue.

Compared with a year ago, long-distance phone revenue jumped 48 percent in the fourth quarter to $3.3 million, mainly because of the popular Infinite Minutes calling plans ACS rolled out last fall.

Infinite Minutes allows customers to make unlimited long-distance calls within Alaska or out of state for a flat rate of $20 a month. But the program brought in so many customers who logged long hours on the phone lines that ACS lost money on both the in-state and out-of-state plans in the fourth quarter, Hemenway said. The company is no longer marketing Infinite Minutes.

ACS has spent much of the past year before regulators and judges arguing over how to deregulate local phone service in Fairbanks and Juneau, two markets where ACS holds monopolies.

ACS said it expects that rival General Communication Inc. will enter those markets this year.

That could cost ACS up to 25 percent of its local phone customers in Fairbanks and up to 14 percent of its local customers in Juneau, Hemenway said.



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