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MCI Says Revenue And Profits Fell In August

In its monthly operating report for U.S. Bankruptcy Court in New York, MCI blamed the declines on fewer business days and higher reorganization costs.
ASHBURN, Va. (AP) -- MCI reported lower net income and revenue in August, blaming the decrease on fewer billed business days and sharply increased reorganization costs.

Net income dropped to $132 million from $207 million in July, the company reported Tuesday.

In a monthly operating report for U.S. Bankruptcy Court in New York, MCI said its monthly revenue also dropped, to $2.01 billion from $2.12 billion the month before.

The Ashburn, Va.-based telecommunications company also cited declines in long-distance volume and an increase in reorganization costs. MCI had $143 million worth of restructuring costs in August, compared to $30 million in July.

The company, formerly called WorldCom Inc., increased its cash on hand to $5.3 billion, a $600 million jump from the beginning of the month.

"Our cash balances continued to grow and we continued to make substantial progress on our financial audit and restatements projects," Bob Blakely, MCI's chief financial officer, said in a statement.

MCI is struggling to emerge from bankruptcy and restore its reputation amid ongoing federal and state investigations into falsified financial reports that hid expenses and inflated profits.

The company relocated from Mississippi this year, changed its name, and hopes to leave bankruptcy by early 2004. Its July 2002 filing was the largest in U.S. history, following revelations of accounting fraud that swelled to $11 billion.