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MetroPCS Communications Inc. Reports Operating Results (10-Q)

October 30, 2012 | About:
10qk

10qk

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MetroPCS Communications Inc. (PCS) filed Quarterly Report for the period ended 2012-09-30.

Metropcs Communications Inc has a market cap of $3.85 billion; its shares were traded at around $10.59 with a P/E ratio of 11.6 and P/S ratio of 0.8. Metropcs Communications Inc had an annual average earning growth of 12% over the past 5 years.

Highlight of Business Operations:

Service Revenues. Service revenues decreased $9.1 million, or 1%, to approximately $1.1 billion for the three months ended September 30, 2012 from approximately $1.1 billion for the three months ended September 30, 2011. The decrease in service revenues is primarily attributable to a net loss of 169,289 customers during the twelve months ended September 30, 2012 as well as a $0.30 decrease in average revenue per customer for the three months ended September 30, 2012 as compared to the three months ended September 30, 2011.

Equipment Revenues. Equipment revenues increased $62.9 million, or 85%, to $137.2 million for the three months ended September 30, 2012 from $74.3 million for the three months ended September 30, 2011. The increase is primarily attributable to higher average price of handsets sold accounting for a $70.2 million increase, as well as a $46.1 million increase in equipment revenues associated with a decrease in commissions paid to independent retailers due to a lower volume of handsets sold. These items were partially offset by a 47% decrease in gross customer additions which led to a $31.8 million decrease, as well as a decrease in upgrade handset sales to existing customers which led to a $20.8 million decrease.

Equipment Revenues. Equipment revenues increased $62.6 million, or 20%, to $377.3 million for the nine months ended September 30, 2012 from $314.7 million for the nine months ended September 30, 2011. The increase is primarily attributable to a $102.7 million increase in equipment revenues associated with a decrease in commissions paid to independent retailers due to a lower volume of handsets sold as well as higher average price of handsets sold, accounting for a $99.9 million increase. These items were partially offset by a 39% decrease in gross customer additions which led to a $111.3 million decrease, as well as a decrease in upgrade handset sales to existing customers, which led to a $27.6 million decrease.

Average Revenue Per User. ARPU represents (a) service revenues less pass through charges for the measurement period, divided by (b) the sum of the average monthly number of customers during such period. ARPU was $40.50 and $40.80 for three months ended September 30, 2012 and 2011, respectively, a decrease of $0.30. ARPU was $40.56 and $40.57 for nine months ended September 30, 2012 and 2011, respectively, a decrease of $0.01. The decrease in ARPU for the three and nine months ended September 30, 2012, when compared to the same period in 2011, was primarily attributable to promotional service plans partially offset by continued demand for 4G LTE service plans.

Cost Per Gross Addition. CPGA is determined by dividing (a) selling expenses plus the total cost of equipment associated with transactions with new customers less equipment revenues associated with transactions with new customers during the measurement period by (b) gross customer additions during such period. Retail customer service expenses and equipment margin on handsets sold to existing customers when they are identified, including handset upgrade transactions, are excluded, as these costs are incurred specifically for existing customers. CPGA costs increased to $202.24 for the three months ended September 30, 2012 from $193.95 for the three months ended September 30, 2011. The increase in CPGA for the three months ended September 30, 2012, was primarily driven by a 47% decrease in gross additions as compared to the three months ended September 30, 2011. CPGA costs increased to $211.98 for the nine months ended September 30, 2012 from $175.30 for the nine months ended September 30, 2011. The increase in CPGA for the nine months ended September 30, 2012 was primarily driven by a 39% decrease in gross additions as compared to the same period in 2011.

Read the The complete Report

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