Qwest Reports Smaller Losses, Announces Shareholder Settlement

Qwest Communications International Inc. narrowed its losses in the third quarter of 2005, reporting a small increase in revenue at $3.5 billion, compared to $3.45 billion a year earlier.

Its operating expenses totaled $3.3 billion, a decline of 9 percent, or $326 million, compared to the third quarter of 2004.

Overall losses came to $144 million in the July-September quarter, down from its $164 million loss in the second quarter of 2005, and $569 million in the third quarter of 2004.

“Our significant progress in productivity continues to drive cost reductions and steady margin improvement,” Oren G. Shaffer, Qwest vice chairman and CFO, said yesterday in a news release. “We continue to improve our free cash flow, putting us on track to meet our goal for 2005 and for further free cash flow growth in 2006.”

The nations fourth-largest local phone company, which serves mostly Western states, also announced a tentative $400 million settlement of shareholder lawsuits. It targets people who bought Qwest securities between May 24, 1999 and July 28, 2002. Qwest had to restate billions of dollars of revenue when the accounting scandal came to light. The settlement is subject to court approval and other conditions, and would dismiss all litigation against Qwest and defendants except for Joseph P. Nacchio, the companys former CEO, and Robert S. Woodruff, Qwests former CFO.

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