Verizon Expects “Significant” Impact on Results From Superstorm Sandy
Telecom giant Verizon Communications, whose headquarters at 140 West Street in lower Manhattan were flooded Monday night by the storm surge brought on by Superstorm Sandy, has no idea what it’s going to cost to get its communications network back up and running.
In an 8-K filing with the U.S. Securities and Exchange Commissions today — primarily devoted to announcing the savings Verizon had garnered as a result of contract negotiations with its unionized work force — the company said its wireless and wireline businesses had experienced an impact from the storm. It didn’t put a dollar amount on what it expects, but the fact that it is softening up the Street for a big one-time charge that will affect its results is telling. It next reports earnings in late January.
Last year, Verizon reported $250 million in combined one-time charges related to Hurricane Irene and a two-week strike that knocked five cents off its earnings per share in the third quarter of 2011. The impact from Sandy will no doubt be much bigger. Even so, Verizon shares rose by 15 cents or less, to $45.29, by mid morning Friday.
Here’s what Verizon said in its filing:
In addition, Verizon’s wireless and wireline businesses have been impacted by Hurricane Sandy through a large portion of the Northeast. Verizon is currently directing its resources toward significant remediation efforts to restore communications services to affected customers, which may take some time. It is not possible at this time to estimate the impact that the storm and the required remediation may have on Verizon’s operating results for the fourth quarter of 2012, but we expect that it could be significant.