Windstream Q2 EPS Down 33%

Windstream (NASDAQ: WIN  ) today reported second-quarter earnings per share of $0.06, a decline of one-third from its EPS of $0.09 for the same period in 2012.

The company did show a 2% growth in business service revenues to $913 million and a 6% growth in consumer broadband service revenues to $120 million from Q2 2012. However, overall revenues declined 1% to $582 million for those same periods.

Yesterday, the company declared a quarterly dividend of $0.25 per share payable on Oct. 15 to stockholders of record as of Sept. 30. That is an 83% dividend-to-free-cash-flow payout ratio.

Windstream updated its outlook for the rest of 2013, expecting its total revenue to decline by 1% to 3% from its 2012 revenue. The company attributes this decline to "a modestly softer business sales environment and continuing pressure in the carrier transport business."

The company also announced it is considering forming a new publicly traded holding company that would become the parent to Windstream and its subsidiaries.

Windstream said it wouldn't make a final decision on its proposed holding company until its analysis is complete. It also said it "does not anticipate a change in its current dividend practice as a result of the formation of a holding company."


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  • Report this Comment On August 08, 2013, at 9:26 PM, hawk1969 wrote:

    Why don't you show your computation of the 83% dividend to free cash flow. I do not see how you arrived at this percentage or would that that be diffcult since you own ftr and would love to see Win stumble? Please comment.

  • Report this Comment On August 09, 2013, at 9:55 AM, XMFDRadovsky wrote:


    The usual computation of free cash flow ( is to take net cash provided from operations, which is found on the company's cash flow statement, and subtract capital expenditures.

    In Windstream's case that would be $408 million less $228.7 million, equaling $179.3 million of free cash flow.

    Since Windstream paid out $148.2 million in dividends, the dividend to free cash flow ratio is 83% (rounded up from 82.655%).

    Frankly, that dividend/fcf ratio looks a whole lot better this quarter than it did for the last one: 242%.

    Thank you for reading,


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