MCLEAN, Va.-Nextel Communications Inc. cited a decreased tax benefit for its net loss during the first quarter, which amounted to $220.9 million, or 93 cents per share, compared with a net loss of $118.7 million, or 56 cents per share for the corresponding period one year ago.
“The growth in the net loss is primarily a result of a significant reduction in the first quarter’s effective tax rate, resulting in a much lower tax benefit offset against operating losses,” said Steve Shindler, chief financial officer of Nextel. “Without the tax rate reduction, the loss per share is essentially flat with fourth quarter results.” The company’s net loss during last year’s fourth quarter totaled $158.4 million, or 70 cents per share.
The effective tax rate for the first quarter was 15.2 percent compared with 37.4 percent for the first quarter 1996. The income tax benefit for the quarter decreased 44 percent to $39.4 million compared with $71 million for the same period a year ago.
Shindler continued, “The strong increase in subscriber additions, as well as the increase in monthly revenue per subscriber, and continued low customer churn rates give us confidence that our service is earning a strong position in the marketplace.”
The company reported revenues of $110.7 million for the first quarter, compared with revenues of $68.3 million for the first quarter of 1996. Radio service revenue increased 78 percent to $103.7 million, compared with $58.1 million for the same period last year. Radio service revenue was $88.8 million during the fourth quarter 1996.
Nextel said it added 122,600 digital mobile units during the quarter for a total of approximately 422,900 digital units in service.
