Leap Q3 loss widens on net interest, tax expenses
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Dec 13 (Reuters) - Mobile phone service provider Leap Wireless International Inc (LEAP.O) posted a wider quarterly net loss, but the bulk of it was due to a hike in net interest and income tax expenses, and shares rose more than 9 percent in after-market trade.
The company posted a third-quarter net loss of $43.3 million, or 64 cents a share, compared with a loss of $0.8 million, or 1 cent a share, a year ago. Service revenue rose 47 percent to $354.5 million.
The increase in net interest and tax expenses as a result of a change in tax accounting methods during the third quarter contributed 55 cents a share to the net loss, the company said in a statement.
Analysts were expecting a loss of 22 cents a share, excluding items, on revenue of $396.1 million for the quarter, according to Reuters Estimates.
Quarterly net interest expense rose $12.9 million due to an increase in the company's long-term debt and a change in its tax accounting method for amortizing certain wireless licenses that resulted in accelerated deductions. Income tax expenses increased $24.1 million.
Leap also said it would restate financial reports from 2004 to the second quarter of this year, resulting in a net cumulative reduction of about $8 million in service revenue and about $23 million in operating income.
It had previously said the net cumulative reduction would be about $20 million in service revenue and about $20 million in operating income.
The stock of the company, which has fallen about 40 percent this year, was trading at $37.26 in late electronic trade, after closing at $34.14 Thursday on the Nasdaq.
(Reporting by Supantha Mukherjee in Bangalore; Editing by Pratish Narayanan)
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