Following up on its initial release in early January, regional operator MetroPCS unveiled full fourth quarter financial results adding more color to what was a difficult three months for the carrier. However, that difficulty was somewhat offset by T-Mobile USA’s offer to acquire MetroPCS.
The carrier reported a 4% increase in total revenues for the fourth quarter, growing from $1.238 billion during the fourth quarter of 2011 to $1.284 billion in 2012. For the full year, revenues increased 5% to $5.1 billion for 2012. Helping to push that growth was a slight increase in average revenue per user, which increased 31 cents during the fourth quarter to $40.86 and 6 cents for the full year to $40.63.
However, that increase was somewhat offset by increases in both its cost per gross customer addition and cash cost per user. For the quarter, CPGA surged $62.25 year-over-year to $228.04 and $43.04 for the full year to $216.15, while CCPU was up $1.91 during the quarter to $21.91 and 82 cents for the full year to $20.38. MetroPCS attributed the CPGA increase to greater promotional activity, while the CCPU increase was attributed to more spent on customer retention efforts, expenses related to its LTE network and commissions paid to retail agents.
These costs pushed total expenses up for both the fourth quarter and full year compared with 2011 results, with fourth quarter net income dropping nearly 72% to $26.7 million, though full-year net income increased 34% to $393.9 million.
MetroPCS had previously announced it had lost 93,200 customers during the quarter, which was a dramatic turnaround from the 197,410 customers the carrier added during the final quarter of 2011, due to a drop in gross customer additions that offset a slight improvement in customer churn. MetroPCS lost nearly 460,000 customers in 2012 compared with a gain of nearly 1.2 million in 2011, and ended the year with nearly 8.9 million customers, or nearly 5% fewer than at the end of 2011.
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Having fallen more than 2% following its initial financial announcement early this year, MetroPCS’ stock (PCS) was down less than 1% in early Tuesday trading and is down just slightly for the year to date.
Acquisition update
In regards to its pending acquisition by T-Mobile USA, MetroPCS filed a proxy statement late yesterday said its board has unanimously recommended the deal move forward and that the company has begun mailing relevant material to its shareholder for a vote.
Along with those materials is a letter from current MetroPCS CEO Roger Linquist, recommending that shareholders approve the deal and laying out benefits to the proposed transaction. Those recommendations included urging shareholders to disregard an attempt by a “single dissident stockholder” to sway shareholders to vote against the deal.
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