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Seeweekly news
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2005-11-10 |
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FiberNet Reports Third Quarter 2005 Results |
FiberNet Telecom Group, Inc. (NASDAQ:FTGX) , a leading provider of complex interconnection services, today announced its results for the third quarter ended September 30, 2005.
Revenues for the third quarter of 2005 were $8.6 million, compared to revenues for the third quarter of 2004 of $8.1 million and revenues of $8.4 million for the second quarter of 2005.
FiberNet continued to achieve consistent revenue growth in its core product offerings of transport and colocation services. For the third quarter of 2005, revenues from transport and colocation services (excluding revenues from access management services) grew by 12.0% over the third quarter of the prior year.
Transport services remain the most significant component of FiberNet's revenues, accounting for 75.1% of the total revenues generated in the third quarter of 2005. On-net transport revenues were 59.9%, and off-net transport revenues were 15.1%. Off-net transport revenues continued to be the fastest growing area for the Company, increasing by 24.9% from the third quarter of 2004.
Colocation services and access management services represented 22.6% and 2.4% of revenues, respectively. FiberNet's number of customers also increased to 225 as of September 30, 2005, up from 198 at the end of the third quarter of 2004. FiberNet has now increased its customer base for thirteen consecutive quarters. New customer wins in the third quarter include Cox Communications and leading international service providers, such as Japan Telecom and RosTelecom, one of Russia's leading telecommunications companies.
"We have posted another solid quarter," said FiberNet's Jon A. DeLuca, President and Chief Executive Officer. "The consistent growth that our business has delivered is a testament to our unrelenting commitment to service and innovation. In particular we have demonstrated a track record of successfully launching major business initiatives, such as our Network Solutions services providing off-net connectivity, which are a significant growth driver for our Company. I am particularly excited about the introduction of our two latest initiatives: Availius, which focuses on delivering our expertise and intellectual capital to our customers and Phonomenum, a technology platform that will enable carriers, cable operators and Internet telephony service providers to establish peering connections for the exchange of Voice-over-IP traffic."
Cost of services for the third quarter of 2005 was $4.3 million, compared to $3.7 million for the third quarter of 2004, and $4.1 million for the second quarter of 2005. The increase was due to increased off-net connectivity costs from the growth of the Company's Network Solutions initiative and increased occupancy expenses related to the Company's colocation facilities.
Selling, general and administrative expenses for the third quarter of 2005 were $4.0 million, compared to $3.9 million in the third quarter of 2004 and $4.4 million for the second quarter of 2005. Included in selling, general and administrative expenses for the third quarter of 2005 are $0.2 million in costs associated with the amendment to the Company's credit facility on August 22, 2005. Included in the second quarter of 2005 are $0.5 million of transaction costs that were expensed primarily in connection with the termination of the Company's agreement to purchase Con Edison Communications. Excluding these charges, selling, general and administrative expenses were $3.8 million for the third quarter of 2005 and $3.9 million for the second quarter of 2005.
The net loss for the third quarter of 2005 was $(2.5) million, or $(0.49) per share, compared to net loss of $(2.3) million or $(0.45) per share for the third quarter of 2004, and a net loss of $(5.9) million or $(1.14) per share for the second quarter of 2005.
EBITDA (as defined), excluding the nonrecurring items in selling, general and administrative expenses, for the third quarter of 2005 was $0.6 million, compared to $0.6 million reported in the third quarter of 2004, and $0.4 million for the second quarter of 2005. The Company presents the financial metric EBITDA (as defined) because it is utilized in the determination of the majority of the financial covenants in its credit agreement, and the metric is calculated in accordance with its credit agreement. As of September 30, 2005, FiberNet was in full compliance with all of the financial covenants in its credit agreement.
Capital expenditures for the third quarter of 2005 were $0.8 million, down from $1.0 million from the quarter ended September 30, 2004. Capital expenditures for the most recent quarter were once again primarily related to the implementation of customer specific orders, including the purchase of networking equipment to increase capacity and to interconnect with new customers. In 2005, FiberNet expects to invest $2.5 million to $3.5 million in capital expenditures, also primarily for customer order activity.
As of September 30, 2005, FiberNet had total assets of $74.9 million and total stockholders' equity of $48.0 million. As of November 8, 2005, the Company had approximately 5.3 million shares of common stock outstanding or 6.1 million shares of common stock outstanding on a fully diluted basis, assuming the exercise of all outstanding options and warrants. Of the approximately 0.8 million outstanding options and warrants, 0.5 million are out-of-the-money as of November 8, 2005. |
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