Bankrupt telephone company WorldCom today reported a net profit in January even as sales fell from the previous month.
The company said sales in January fell to $2.16 billion from $2.2 billion in December 2002, but its net profit was $155 million compared with a net loss of $580 million the previous month.
WorldCom must file monthly financial statements with the bankruptcy court during its Chapter 11 reorganisation. It said its income from continuing operations before reorganisation items was a $188 million profit versus a $47 million loss in December.
WorldCom, which has warned that its accounting problems may exceed $9 billion, ended January with $2.8 billion in cash on hand, an increase of about $300 million from the beginning of the month. Its capital spending in January was $34 million.
"We still have a lot of work to do, but we are delivering on our 100-day plan," WorldCom chairman and chief executive Mr Michael Capellas said in a statement. "We remain on track to emerge from Chapter 11 protection later this year," he added.
Last month the company said it would cut 5,000 jobs, or more than 8 per cent of its work force, and reduce annual costs by $2.5 billion.
Two reports reviewing WorldCom's past accounting practices and corporate governance issues are expected to be released in the next few months. Court-appointed examiner Mr Richard Thornburgh is expected to release an updated report by May, sources familiar with the situation previously said.
The January financial results exclude the results of Embratel, a Brazilian long-distance carrier in which WorldCom has a stake.