Virgin Mobile Posts Narrower Q4 Losses
Virgin Mobile USA reported a narrower fourth-quarter loss amid continued grumbling from investors. The pay-as-you-go carrier went public in October 2007 with shares at $15; shares closed at $4.20 on the New York exchange yesterday. Virgin Mobile CEO Dan Schulman reportedly told analysts that the company is just as frustrated by this as investors but that he still “believes we have the right business strategy and value proposition” to weather the economic slowdown and still see revenues grow.
For Q4, Virgin Mobile posted a net loss of $14.7 million, or 30 cents per share, compared with a loss of $44.9 million, or $1.74 a share for the same period a year ago. The company said its adjusted loss was 28 cents per share compared with a loss of 85 cents for the fourth quarter of 2006. Virgin also posted a rise in net service revenue to $293.6 million from $271 million a year earlier, and a rise in total operating revenue to $326.5 million from $298 million a year ago.
Customer additions for the quarter, however, were down to 958,000 from 1.29 million; the carrier said in part because it did not cut prices for the holiday season. And churn was down to 5.1% from 5.6%. At the close of the year, Virgin Mobile had about 5.1 million customers.
For 2008, Virgin said it expects year-over-year revenue to be flat, and for earnings to reach 19 cents to 35 cents per share.