BellSouth's 3Q Profits SoarBellSouth's 3Q Profits Soar

ATLANTA (AP) -- BellSouth Corp. cited growth in its Latin America division and its long-distance and high-speed Internet services as it posted a 46 percent jump in third-quarter profit on higher revenues. The results beat Wall Street expectations.

The Atlanta-based telecommunications company said Wednesday it earned $936 million, or 51 cents a share, for the three months ending Sept. 30, compared to $640 million, or 34 cents a share, a year earlier.

Excluding one-time items--charges related to asset impairment and foreign currency transaction losses-- BellSouth said it earned $980 million, or 53 cents a share. Analysts surveyed by Thomson First Call were expecting earnings of 50 cents a share excluding one-time items.

Revenue for the July-September quarter rose 5 percent to $5.72 billion, from $5.43 billion in the year-ago period.

The company said that its long-distance and DSL high-speed Internet services drove revenue growth in its communications group in the quarter, as customers increasingly opted for BellSouth's bundled packages. Its packages helped the company retain residential and small business customers.

BellSouth also added 654,000 net long-distance customers in the third quarter. Still the company said total access lines declined 4 percent to 23.9 million compared to a year earlier, citing technology substitution, the economy, and competition.

BellSouth also cited strong growth in Latin America, where revenues in the quarter increased nearly 19 percent and the company added 1.4 million customers year-over-year.

BellSouth's strong presence in Latin America bucks a trend in the last few years that has seen some other major U.S. telecom companies reduce their exposure there amid economic and political turmoil in the region.

Analysts say the geographic location of BellSouth's U.S. customer base gives it an advantage in marketing services to Latin America. The fact that BellSouth is focusing on wireless customers there, reducing its capital expenses, is also an advantage.

BellSouth, one of the regional phone companies that emerged from the Bell System breakup, is the dominant local service provider in nine Southeastern states.

BellSouth serves 44 million customers in Georgia, Tennessee, Florida, Alabama, Kentucky, Mississippi, North Carolina, South Carolina, Louisiana, and 14 countries.

For the first nine months of the year, BellSouth said it earned $3.12 billion, or $1.68 a share, compared with a profit of $749 million, or 40 cents a share, a year earlier. Nine-month revenue edged up to $16.89 billion from $16.75 billion in 2002.