US Cellular 4Q Net Drops 46% on Sprint Nextel Spectrum Deal

US Cellular's fourth-quarter net income dropped 46% to $29.2 million, or 33 cents a share, from $54.1 million, or 61 cents a share, a year earlier, due to a loss related to a spectrum exchange deal made with Sprint Nextel.

U.S. Cellular recorded a $20.8 million pretax loss on its deal to deliver personal communication service spectrum in eight licenses to Sprint in exchange for other spectrum. The deal is expected to close in the first half of the year.

The Chicago wireless carrier said operating revenue rose to $1.02 billion from $902.1 million in the year-ago period.

On average, analysts polled by Thomson Financial expected revenue of $1.02 billion.

U.S. Cellular added 70,000 net retail postpay customers, though it lost 6,000 prepay customers and 9,000 net reseller customers.

The company forecast full-year operating income of $460 million to $535 million on service revenue of $3.9 billion to $4 billion. The company expects to add a net 250,000 to 325,000 retail customers.

Shares of U.S. Cellular were recently trading down $2.67, or 4.2%, at $61.58.

-Melissa Korn; 201-938-5400; AskNewswires@dowjones.com

(END) Dow Jones Newswires

Posted to the site on 1st March 2008