Pacific Telesis Group, parent of Pacific Bell, on Tuesday reported a 15% increase in net income for the quarter ended June 30--a result echoed by some of its former siblings in the old Bell System.
Profits for the second quarter reached $243.6 million as revenue increased 8.4% to $2.12 billion. For the six months, profits totaled $467.1 million, up 14.3%, on revenue that increased 9.4% to $4.18 billion, the San Francisco-based company said.
Chairman Donald E. Guinn said "the continued strength of the California economy" increased demand for service from Pacific Bell, which provides local telephone service in California. Pacific and Nevada Bell account for most of the parent's revenue and almost all of its earnings.
The company held growth in expenses to 6.5% for the six months, with about half of the increase coming from higher depreciation expenses, Guinn added. "But even higher depreciation rates will be necessary in the future," he warned. Pacific Bell is seeking to offset increased depreciation costs through higher rates in its proposed 1986 rate increase package before the Public Utilities Commission.
Other Regionals Gain
Other regional telecommunications holding companies formed after the Jan. 1, 1984, breakup of the Bell System also reported improved second-quarter results:
- New York-based Nynex had net income of $262.5 million, up from $239.6 million a year earlier, on revenue of $2.54 billion, compared to $2.36 billion. For the six months, earnings totaled $519.9 million, up from $461.3 million, on revenue of $5.05 billion, up from $4.64 billion.
- Chicago-based Ameritech reported second-quarter earnings of $270.1 million, up from $263.9 million a year ago, on revenue of $2.24 billion, versus $2.07 billion. For the six months, earnings totaled $544.4 million, compared to $521.5 million, on revenue of $4.46 billion, up from $4.1 billion.
- Southwestern Bell, based in St. Louis, said second-quarter profit spurted to $256.9 million from $212.1 million for the same quarter in 1984 on revenue of $1.99 billion, up from $1.76 billion. First-half profit rose to $521.5 million on revenue of $3.91 billion, compared to $417.1 million on revenue of $3.47 billion for the first six months of 1984.
GTE Profits Edge Up
Also reporting Tuesday was GTE Corp., parent of General Telephone of California, which said that second-quarter profits were up only 0.7% as gains from local telephone operations were offset by a $68-million operating loss from its long-distance service, GTE Sprint, the nation's third largest after AT&T and MCI. Sprint earned $30 million in 1984's second quarter.
GTE, based in Stamford, Conn., said profits totaled $285 million, up from $283 million for the 1984 quarter, on revenue that increased 7.7% to $3.91 billion. Six-month results showed profits slipping 6.2% to $558.2 million while revenue rose 6.8% to $7.56 billion. Last year's first half included a $45-million one-time gain from an accounting change, however, the company said.