MetroPCS profit drops in Q2 on charge,expansion cost

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Higher operating costs and a $9 million charge overwhelmed customer and revenue growth at MetroPCS Communications Inc. Second-quarter profit fell to $50 million, or 14 cents a share, from $58 million, or 17 cents a share, during the same period last year. Increased advertising and network construction raised expenses at the Richardson-based cellular carrier, which provides unlimited service plans with no contracts.

"We are very pleased to see strong financial and operational results during the seasonally slow second quarter and in the current challenging economic environment. With year over year Consolidated Adjusted EBITDA growth of approximately 17%, and second quarter net subscriber additions of approximately 184 thousand, we are confident that our outlook for 2008 is achievable. We have been able to continue to grow our business and effectively manage our costs, while delivering profitable growth that builds long-term shareholder value. While continuing to invest in growing our market footprint and aggressively acquiring customers, consistent with our low-cost strategy, we again reported industry-leading low consolidated CPGA and CPU," said Roger D. Linquist, Chairman, President and Chief Executive Officer of MetroPCS.

"Not only have we continued to add new markets, but we continue to innovate and add to our service offerings. During the quarter we introduced MetroFlash; an exciting service that allows consumers to bring their existing compatible CDMA handsets and use them on the MetroPCS network. With rising prices, consumers are looking for ways to cut expenses and MetroFlash, along with our low cost, flat-rate, unlimited service plans, makes MetroPCS an affordable and compelling option.

"Our buildout of our Auction 66 Markets continues, and we look forward to our future launches of service in the New York and Boston metropolitan areas. We were very pleased to reach an important milestone in early July with the launch of service in our first Northeast market, Philadelphia, ahead of schedule. Similar to our upcoming launches of service in New York and Boston, the Philadelphia metropolitan area is a densely populated market and is ideal for MetroPCS' predictable, affordable and flexible service. We expect our Northeast markets represent a significant area of future growth for the Company," Linquist concluded.