Dear Investor to Investor readers:
I just picked up this information from the IXC COMMUNICATIONS INC (IIXC)
Quarterly Report (SEC form 10-Q):
Net operating revenue for the third quarter of 1998 increased by 35.4% over
the third quarter of 1997 due in part to a $23.6 million increase in private
line revenue. The private line increase reflected the impact of the Company's
larger network and associated capacity available for lease in 1998. A
significant portion of this improvement was from a large capacity contract
with one Internet Service Provider ("ISP"). Net operating revenue in the third
quarter of 1998 was also affected by a $15.9 million increase in switched long
distance revenue due mainly to a 21.9% increase in wholesale billable minutes
of use ("MOU"). A major portion of this increase was due to services provided
to a debit card provider during the third quarter. The debit card provider has
been a customer for switched long distance services for several years and
became a significant customer in the third quarter due to the success of its
sale of debit cards. In November 1998, the Company resolved certain billing
and payment disputes with the customer and such resolution is expected to
result in further significant increases in this customer's MOUs. In light of
the dramatic increase in MOUs from this customer, the Company agreed (i) to
credit certain of the customer's third quarter billings (which amount was
adequately reserved at September 30, 1998) primarily to reflect reduced rates
for increased volume; (ii) to decrease its current billing rates to reflect
the customer's continuing increase in MOUs and (iii) to accept a secured note
for approximately $16 million payable at the rate of $250,000 per week for
prior services.
My comments follow:
IXC had a secured note for $16 million from the debit card company and
resolved the billing and payment disputes with the company in November 1998.
This looks like DCTC is paying for the right to collect 1/4 of a million
dollars a week from the secured note, and gets to use the IXC infrastructure
in Europe.
>From today's news release, "DCI's taking management control of a significant
customer of IXC which has defaulted in payments to IXC, and a 5-year
commitment by DCI to utilize significant domestic and international
telecommunications services from IXC."
If this is what it looks like, this is monumental. It looks like DCTC is
exchanging $16 million dollars of stock for a weekly cash infusion from the
debit card customer, which will allow IXC to write off the transaction, and
DCTC will take control of managing the 1/4 million a week. Looks like we have
something more here than meets the eye.
Kathy Knight-McConnell
Investor to Investor
imall.com
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NOTE:
1) I am in receipt of a certificate for 24,500 restricted (and as yet
unregistered) shares of NPCT stock as payment for an "introductory fee" to
certain parties in Switzerland.
2) I have recently been retained by DCH Technologies, Inc. to write their
press releases on a per release payment schedule. No shares have been offered
or received.
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