Exhibit 99
[SPRINT LOGO]
Media Contact:
Nicholas Sweers, 913-794-3460
nicholas.sweers@mail.sprint.com
Investor Relations Contact:
Kurt Fawkes, 913-794-1140
kurt.e.fawkes@mail.sprint.com
Sprint Announces Key Strategic Actions
o Will Record Impairment Charge on Long-Distance Network Assets
o Realign Sales Efforts to Leverage its Unique Portfolio of IP, Wireless and
Wireline Products and Services
o Additional Workforce Reductions
OVERLAND PARK, Kan. - Oct. 15, 2004 - Sprint Corporation (NYSE:FON) today
announced it will record in its third quarter financial results a pre-tax
non-cash impairment charge reducing the value of its long-distance network
assets. The company expects to disclose the amount of the charge when it issues
its third quarter financial report on the morning of Oct. 19.
The decision to take the charge comes after an analysis of long-distance
business trends and projections that took into account current industry and
competitive conditions, recent regulatory rulings, evolving technologies and the
company's strategy to expand its position as a leader in telecom solutions.
"The marketplace has changed dramatically, and it is important that we seize the
opportunities that our unique portfolio of wireless and wireline assets allows
us to offer," said Howard Janzen, president of Sprint Business Solutions (SBS).
"We are accelerating our transformation by increasing our business sales efforts
in three growth areas - multi-product bundles, IP and wireless solutions - while
reducing sales efforts on stand-alone business services in the highly
competitive long-distance industry. This strategy plays to our strengths by
advancing our broad portfolio of wireline and wireless capabilities, which is
unmatched by any of our competitors," Janzen added.
Janzen said Sprint Business Solutions plans to ramp up efforts to:
o Increase customer migration to wireless-enabled and IP-driven solutions
using Sprint's full suite of telecom services capabilities
o Drive its leadership position in the development and delivery of customer
solutions requiring transparent wireless and wireline connectivity
o Align employee resources and capital investments with the opportunities for
growth and profitability
As a result, Sprint expects to reduce its workforce by up to 700 in SBS,
primarily in sales and support areas. The reduction will be achieved through
attrition, voluntary separations and layoffs. All impacted employees will be
eligible for severance benefits, including an extension of pay and benefits and
professional outplacement assistance.
Financial guidance
Sprint expects to report third quarter Adjusted EPS, which excludes network
impairment, restructuring and certain other one-time items, that is in excess of
the current mean analyst estimate of 21 cents per share.
*Financial Measures
Sprint provides readers financial measures generated using generally accepted
accounting principles (GAAP) and using adjustments to GAAP (non-GAAP). The
non-GAAP financial measures reflect industry conventions, or standard measures
of liquidity, profitability or performance commonly used by the investment
community for comparability purposes. Because Sprint does not predict special
items that might occur in the future, and our forecasts are developed at a level
of detail different than that used to prepare GAAP-based financial measures,
Sprint does not provide reconciliations to GAAP of its forward-looking financial
measures. The financial measures used in this release include the following:
Adjusted earnings per share is defined as diluted earnings (loss) per share from
continuing operations plus special items. This non-GAAP measure should be used
in addition to, but not as a substitute for, the analysis provided in the
statement of operations.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION:
This news release includes "forward-looking statements" within the meaning of
the securities laws. The statements in this news release regarding the business
outlook and expected performance, as well as other statements that are not
historical facts, are forward-looking statements. The words "estimate,"
"project," "forecast," "intend," "expect," "believe," "target," "providing
guidance" and similar expressions are intended to identify forward-looking
statements. Forward-looking statements are estimates and projections reflecting
management's judgment and involve a number of risks and uncertainties that could
cause actual results to differ materially from those suggested by the
forward-looking statements. With respect to these forward-looking statements,
management has made assumptions regarding, among other things, customer and
network usage, customer growth and retention, pricing, operating costs, the
timing of various events and the economic environment.
Future performance cannot be ensured. Actual results may differ materially from
those in the forward-looking statements. Some factors that could cause actual
results to differ include:
o the effects of vigorous competition and the overall demand for Sprint's
service offerings in the markets in which Sprint operates;
o the costs and business risks associated with providing new services and
entering new markets;
o adverse change in the ratings afforded our debt securities by ratings
agencies;
o the ability of Wireless to continue to grow and improve profitability;
o the ability of Local and Long distance to maintain cash flow generation;
o the effects of mergers and consolidations in the telecommunications
industry and unexpected announcements or developments from others in the
telecommunications industry;
o the uncertainties related to bankruptcies affecting the telecommunications
industry;
o the impact of financial difficulties of third-party affiliates on Wireless
network coverage;
o the uncertainties related to Sprint's investments in networks, systems and
other businesses;
o the uncertainties related to the implementation of Sprint's business
strategies, including our initiative to realign services to enhance the
focus on business and consumer customers;
o the impact of new, emerging and competing technologies on Sprint's
business;
o unexpected results of litigation filed against Sprint;
o the risk of equipment failure, natural disasters, terrorist acts, or other
breaches of network or information technology security;
o the possibility of one or more of the markets in which Sprint competes
being impacted by changes in political or other factors such as monetary
policy, legal and regulatory changes or other external factors over which
Sprint has no control; and
o other risks referenced from time to time in Sprint's filings with the
Securities and Exchange Commission (SEC).
Sprint believes these forward-looking statements are reasonable; however, you
should not place undue reliance on forward-looking statements, which are based
on current expectations and speak only as of the date of this release. Sprint is
not obligated to publicly release any revisions to forward-looking statements to
reflect events after the date of this release or unforeseen events. Unless
specifically discussed in this release, no forward-looking statements made by
Sprint before the date of this release should be deemed to be reiterated,
confirmed or updated by any statement in this release. Sprint provides a
detailed discussion of risk factors in various SEC filings, including its 2003
Form 10-K, and you are encouraged to review these filings.
About Sprint
Sprint is a global integrated communications provider serving more than 26
million customers in over 100 countries. With more than $26 billion in annual
revenues in 2003, Sprint is widely recognized for developing, engineering and
deploying state-of-the-art network technologies, including the United States'
first nationwide all-digital, fiber-optic network and an award-winning Tier 1
Internet backbone. Sprint provides local communications services in 39 states
and the District of Columbia and operates the largest 100-percent digital,
nationwide PCS wireless network in the United States. For more information,
visit www.sprint.com.