On Oct. 27, Income Investor recommendation Alltel (NYSE:AT) released third-quarter earnings for the period ended Sept. 30.

  • Alltel added 829,000 customers, up 14% over last year.
  • Net margin decreased by 204 basis points to 8.23%.
  • GAAP-adjusted earnings per share slipped 14%, while non-GAAP operating earnings rose 11%.
  • Cash and short-term investments increased more than 4,000% to $3 billion.
  • Free cash flow declined by 58.6%.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

Q3 2006

Q3 2005

Change

Sales

$2,030

$2,007

$1,793

12.0%

Net Profit*

--

$165

$184

(10.3%)

EPS

$0.64

$0.43

$0.50

(14.0%)

Diluted Shares

--

387

368

5.2%

*Does not include income from discontinued operations.

Get back to basics with a look at the income statement.

Margin Checkup

Q3 2006

Q3 2005

Change*

Gross Margin

54.97%

56.80%

(1.83)

Operating Margin

17.83%

18.89%

(1.06)

Net Margin

8.23%

10.27%

(2.04)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q3 2006

Q3 2005

Change

Cash + ST Invest.

$3,086

$69

4,372.4%

Accounts Rec.

$835

$1,117

(25.2%)

Inventory

$156

$177

(11.8%)



Liabilities

Q3 2006

Q3 2005

Change

Accounts Payable

$464

$496

(6.4%)

Long-Term Debt

$2,712

$5,920

(54.2%)



Learn the ways of the balance sheet.

Cash Flow Highlights

Q3 2006

Q3 2005

Change

Cash From Ops.

$340

$373

(8.7%)

Capital Expenditures*

$284

$238

19.4%

Free Cash Flow

$56

$135

(58.6%)

*Includes capitalized software-development costs.

Find out why Fools always follow the money.

Related Companies:

  • AT&T (NYSE:T)
  • BCE (NYSE:BCE)
  • Verizon Communications (NYSE:VZ)
  • BellSouth (NYSE:BLS)

Related Foolishness:

AT&T is a former Motley Fool Stock Advisor recommendation, and Alltel is a current pick inMotley Fool Income Investor. See what investors like you are saying about Alltel in Motley Fool CAPS, our new stock-rating service.

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