Administration June 12, 2002

Options, Pensions To Clip Verizon 2003 Earnings

December 6, 2002 (PLANSPONSOR.com) - Verizon Communications says next year's earnings estimates will be lower, hit by a decision to expense stock options and a reduction in earnings derived from pension investments, according to a Wall Street Journal report.
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Verizon expects stock option expensing will reduce earnings estimates by 2 cents a share in 2003.   Further, pension investment contributions could be reduced 2 to 8 cents a share next year, from the 35 cents per share in 2002.   Verizon is attributing this decline to escalating benefit costs and lower returns on the money it invests to cover pension expenses.

However, Verizon said it does not expect a need to contribute to its pension plan next year to cover the cost of retiree pension and benefits.

2003 earnings projections will not be released until January, when 2002’s final numbers are calculated.   Verizon said it expects 2002’s operating earnings to be in line with earlier projections of $3.05 to $3.09 a share.

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