Illuminet Third Quarter Revenue $26.8 Million, Up 43%
Third Quarter Net Income Increases 172%
OLYMPIA, Wash.--(BUSINESS WIRE)--Nov. 3, 1999--Illuminet Holdings, Inc. (Nasdaq:ILUM - news), the largest unaffiliated provider of SS7 network services in the United States, today announced financial results for its third quarter ended September 30, 1999.
Revenue for the quarter increased 43% to $26.8 million, compared to $18.7 million in the third quarter of 1998. For the nine months ended September 30, 1999, revenue increased 43% to $71.9 million, compared to $50.3 million for the comparable nine-month period in 1998.
Net income for the quarter increased 172% to $3.5 million, or $.54 per share on a fully diluted basis, compared to $1.3 million or $.22 per share in the third quarter of 1998. The fully diluted earnings per share computation is based upon 6.6 million and 6.5 million weighted-average shares respectively. On a pro forma diluted basis, earnings per share for the quarter was $.14 per share compared to $.05 per share in the third quarter of 1998 based upon 26.6 million and 26.0 million weighted-average shares respectively. Pro forma diluted earnings per share computations reflect the retroactive conversion of all Illuminet convertible preferred stock, Illuminet's stock restructuring, and a debt conversion and redemption, all of
which occurred after September 1999. Such pro forma amounts do not include the effect of the IPO, which occurred on October 8, 1999.
For the nine months ended September 30, 1999 net income increased 119% to $8.0 million, compared to $3.6 million for the comparable nine-month period in 1998.
``This was a great quarter for Illuminet,' commented Roger Moore, President and Chief Executive Officer. ``Our performance was strong in our core products of Network Connectivity and Intelligent Network Services. In addition, we successfully completed our initial public offering in October, which we believe will heighten our market presence, and should enable us to further expand and enhance our network and complementary product and service offerings to wireline, wireless and IP-based carriers.'
THIRD QUARTER REVENUES
Network Services, comprised of Network Connectivity, which includes message switch and transport, and Intelligent Network Services, contributed $25.0 million to revenues in the quarter compared to $16.1 million in the year-ago quarter, representing a 55% increase. Of this amount, Network Connectivity contributed $13.4 million to revenues in the quarter compared to $9.7 million in the year-ago quarter representing a 37% increase, and Intelligent Network Services contributed $11.6 million to revenues in the quarter compared to $6.3 million in the year-ago quarter representing an 83% increase. This increase includes a one-time increment to revenue of approximately $1.0 million in the third quarter of 1999 as a result of our internal implementation of a new system to collect billing data.
Clearinghouse Services contributed $1.5 million to revenues in the quarter compared to $1.4 million in the year-ago quarter, representing an 8% increase.
Network Usage Software Applications contributed $0.3 million to revenues in the quarter compared to $1.3 million in the year-ago quarter. This decrease relates to the sale of software licenses in third quarter of 1998.
THIRD QUARTER EXPENSES
Carrier costs were $7.4 million in the third quarter of 1999 compared to $6.2 million in the year-ago quarter, representing a 19% increase. Carrier costs represented 28% of revenues, compared to 33% in the year-ago quarter.
Operating expense was $6.7 million in the quarter compared to $5.3 million in the year-ago quarter representing a 27% increase. As a percentage of revenue, operating expense was 25%, compared to 28% in the year-ago quarter.
SG&A expense was $3.8 million in the quarter compared to $2.5 million in the year-ago quarter representing a 51% increase. SG&A expense represented 14% of revenues, compared to 13% in the year-ago quarter.
Depreciation was $3.0 million in the quarter compared to $2.4 million in the year-ago quarter representing a 28% increase. Depreciation represented 11% of revenues compared to 13% a year ago.
RECENT HIGHLIGHTS
In October, Illuminet completed an initial public offering of 3.9 million shares of common stock at an offering price of $19 per share. The underwriters exercised their over-allotment option to purchase an additional 585,000 shares at $19 per share. The offering was underwritten by Morgan Stanley Dean Witter, and co-managed by BancBoston Robertson Stephens, and Donaldson, Lufkin & Jenrette. All of the shares were offered by the company.
In September, Illuminet announced that more than half a million local telephone numbers have been ported through its number portability Service Order Administration system in just over a year.
Also in September, Illuminet successfully routed and replied to number portability queries from a wireless carrier.
The successful trial with Chicago-based U.S. Cellular Corporation positions Illuminetas a viable alternative for wireless carriers to meet their unique number portability needs. Illuminet has begun offering the wireless number portability service commercially and has signed up its first customer.
ABOUT THE COMPANY
Founded in 1981, Illuminet operates the largest unaffiliated Signaling System 7 (``SS7') network in the United States and is a leading provider of complementary advanced signaling technology and applications to telecommunications carriers. Connection to the Illuminet network gives carriers access to the system of signaling networks of nearly the entire U.S. public-switched telecommunications infrastructure through a single source. Illuminet specializes in signaling network services and intelligent network solutions for a variety of services such as caller identification, calling card validation, wireless fraud management, number portability and other specialized database access functions.
Illuminet's headquarters are at 4501 Intelco Loop, SE, Lacey, WA 98503; 360/493-6000; www.illuminet.com.
Illuminet is a registered service mark of Illuminet, Inc., in the United States and Canada. Other product and brand names are trademarks of their respective owners. |
