here it is.
Subj: PSINet Reports Record First Quarter Results and Improvement in EBITDA
Date: 97-04-22 11:47:30 EDT
From: AOLNewsProfiles@aol.net
HERNDON, Va., April 22 /PRNewswire/ -- PSINet Inc. (Nasdaq: PSIX), the
first commercial Internet Service Provider, today announced consolidated
financial results for the first quarter of 1997. Revenues were $25.6 million,
an increase of approximately 50% over the $17.2 million reported for the first
quarter of 1996, and an increase of 12.5% over the fourth quarter of 1996.
The net loss was $9.3 million or $0.23 per share, compared with a net loss of
$14.9 million or $0.39 per share in the first quarter of 1996.
"We are pleased with our growth in the first quarter and our achievements
of record revenues and the continued rapid expansion of our customer base,"
said William L. Schrader, Chairman, President, Chief Executive Officer and
founder. "We are also pleased to be proceeding on plan towards positive
EBITDA and bottom line profitability." First quarter net loss includes a net
gain of $5.7 million on the sale of InterCon Systems Corporation in February
of this year. "Exiting our software business was the final step toward
re-focusing our full efforts on our core business -- providing Internet
services to businesses," said Schrader.
PSINet's first quarter revenues relating to the core business of corporate
Internet service increased by 113% over the same period last year.
In addition, first quarter net loss includes certain non-recurring
expenses, consisting of $1.5 million (net of tax) relating primarily to the
company's accelerated amortization of certain intangible assets held by
PSINet's subsidiary in the United Kingdom. Without the combined effect of
this and the $5.7 million gain, the loss per share would be $0.33. EBITDA for
the first quarter of 1997 was a loss of $6.8 million, compared to a loss of
$10.1 million for the first quarter of 1996 and $9.0 million for the fourth
quarter of 1996.
Customer totals at March 31, 1997 more than doubled to 20,900 corporate
accounts compared to 10,300 at March 31, 1996. Included in the count at March
31, 1997 are 33 customers being served by the company's wholesale business --
serving consumer-oriented ISP's by providing network capacity in support of
their consumer business plans.
"In addition to sustaining our revenue and corporate account growth, we
have been successful at controlling our expenses over the last few quarters,"
said Edward D. Postal, Vice President and Chief Financial Officer, "which is
evidenced by the modest expense growth during that period."
PSINet also reported a March 31, 1997 balance of $59.8 million in cash and
short-term investments, compared to its December 31, 1996 balance of
$57.3 million. The company's debt obligations have increased slightly to
$54.1 million at March 31, 1997 from the December 31, 1996 balance of
$51.8 million, resulting primarily from capital expenditures funded through
long term leases. Capital expenditures were $10.8 million during this
quarter, compared with $7.6 million in the previous quarter.
Goodwill, other intangible assets and capitalized software costs decreased
from $16.7 million at December 31, 1996 to $2.4 million at March 31, 1997.
The decrease of $14.3 million includes $12.4 million attributed to goodwill
and other intangible assets related to the sale of InterCon.
Condensed Consolidated Statements of Operations
($ in millions, except loss per share)
Three months ended Three months ended
March 31, 1996 March 31, 1997
Revenue $17.2 $25.6
Operating costs and expenses:
Data communications and operations 14.0 21.0
Sales and marketing 7.8 6.0
General and administrative 5.5 5.4
Depreciation and amortization 6.2 8.0
Total operating costs and expenses 33.5 40.4
Loss from operations (16.3) (14.8)
Interest income (expense) 0.4 (0.6)
Other income (expense) 1.1 --
Gain on sale of subsidiary -- 5.7
Equity in loss of affiliate (0.1) --
Loss before taxes (14.9) (9.7)
Income tax (benefit) -- (0.4)
Net loss ($14.9) ($9.3)
Total EBITDA (A) ($10.1) ($6.8)
Weighted average shares
Outstanding (thousands) 38,178 40,158
Loss per share ($0.39) ($0.23)
(A) Represents earnings (loss) before interest income and expense, income
tax expense (benefit), other income and gains, depreciation and amortization,
and equity in loss of affiliate.
Condensed Consolidated Balance Sheets
($ in millions)
Dec. 31, 1996 March 31, 1997
Assets
Cash & short-term investments $57.3 $59.8
Accounts receivable, net 17.4 17.6
Notes receivable 0.7 1.0
Inventories 0.6 0.7
Prepaid expenses 2.0 1.5
Other current assets 4.2 2.5
Total current assets 82.2 83.1
Property & equipment, net 72.1 75.8
Goodwill & other intangibles, net 16.7 2.4
Other assets & deferred charges 6.1 6.0
Total assets $177.1 $167.3
Liabilities & shareholders' equity
Line of credit $2.0 $2.0
Current portion of long-term debt 24.9 26.8
Trade accounts payable 19.9 19.0
Accrued expenses 6.7 5.9
Deferred revenue 5.6 5.0
Total current liabilities 59.1 58.7
Long-term debt 26.9 27.3
Deferred taxes & other liabilities 1.3 0.8
Total liabilities 87.3 86.8
Shareholders' equity
Common stock & APIC 208.4 208.4
Treasury stock (2.0) (2.0)
Retained deficit (116.6) (125.9)
Total shareholders' equity 89.8 80.5
Total liabilities and shareholders' equity $177.1 $167.3
PERFORMANCE METRICS
PSINet, in the third quarter of 1996, introduced industry performance
metrics by which its account growth rates, retention rates, revenue per
point-of-presence (POP) revenue per corporate account, and revenue per
employee could be compared within the Internet Service Provider segment.
These measures were reported again for the fourth quarter of 1996, for the
full year of 1996, and the first quarter of 1997.
ANNUALIZED METRICS
Quarter 1Q 96 2Q 96 3Q 96 4Q 96 1Q 97
Corporate accounts 10,300 12,400 15,100 17,800 20,900
Growth rate over previous
year's quarter 134% 163% 143% 117% 103%
Wholesale account 0 1 15 22 33
Corporate account
retention rate 88.3% 96.8% 96.8% 90.6% 91.5%
Revenue per POP $245,000 $234,000 $263,000 $276,000 $290,000
Corporate accounts per POP 32 36 44 51 59
Revenue per
corporate account $5,800 $5,200 $5,800 $5,700 $5,200
Revenue per employee $112,000 $132,000 $171,000 $195,000 $200,000
PSINet is a leading provider of turn-key corporate Internet and Intranet
access, managed security services, electronic commerce solutions, and web
hosting services throughout the United States and abroad. PSINet manages one
of the world's largest and most advanced fast-packet networks, which provides
state-of-the-art, high speed Internet access ranging from dedicated high-speed
circuits to ISDN to high-speed modem dial-up. PSINet stands behind its
state-of-the-art network with the industry's first commercial service
guarantee, employing automatic back-up systems and crediting service for
outages of as little as one percent of a business day.
Headquartered in Herndon, VA, PSINet has offices and subsidiaries
providing service throughout the U.S., Canada, Japan, and the U.K. For more
information contact PSINet by phone at 7O3-904-4100, by e-mail at info@psi.com
or by accessing the Website at psi.net. |
