Metromedia International Group Reports Year-end 1999 Results
Communications Group Reports Continued Subscriber and Revenue Growth
NEW YORK--(BUSINESS WIRE)--March 30, 2000-- PLD Telekom Successfully Integrated
Corporate Overhead Significantly Reduced
Metromedia International Group, Inc. (AMEX:MMG - news), which through its Communications Group is the owner of various interests in communications joint ventures in Eastern Europe, the former Soviet Union and other emerging markets, today reported operating results for its fiscal 1999 year-end.
For the year ended December 31, 1999, the Company reported a net loss of $142.0 million ($2.09 per share) on revenues of $264.8 million compared to a net loss of $123.7 million ($2.01 per share) on revenues of $240.3 million in 1998. On a combined basis, total subscribers for the Company's Communications Group, including cable, telephony and paging subscribers, increased from 511,500 in 1998 to 874,000 in 1999, a 71% increase.
As previously announced, on September 30, 1999, the Company consummated the acquisition of PLD Telekom Inc., whose principal assets are fixed and wireless telephony operations in Russia and Kazakhstan. Accordingly, the Company's results for the year ended December 31, 1999 include the operating results for PLD Telekom for the fourth quarter only. PLD Telekom's principal business units are: PeterStar, which provides integrated local, long distance and international telecommunications in St Petersburg through a fully digital fiber optic network; Teleport-TP, which provides international telecommunications services from Moscow and operates a pan-Russian satellite-based long distance network; and ALTEL, which provides cellular service in the Republic of Kazakhstan.
Of the Company's 1999 consolidated revenues of $264.8 million, $48.7 million related to the Communications Group and included fourth quarter consolidated revenues attributable to PLD Telekom of $22.9 million. Going forward, the Communications Group's revenues are expected to account for an increasing share of the Company's consolidated revenues. The Company will continue to focus and develop its position as a leading provider of services in the high growth and converging telephony and cable TV markets of Eastern Europe and republics of the former Soviet Union.
Included in the 1999 losses mentioned above, were restructuring, asset impairment and investment write-down charges of $77.3 million, including $23.2 million related to certain of the Company's paging, cable TV and telephony investments in Eastern Europe and the former Soviet Union and an $8.4 million restructuring charge related to the closure of the Company's Stamford, Connecticut office and reduced staffing levels in the Company's Vienna office. The Company also closed PLD Telekom's London office and combined two separate Moscow offices into one. The majority of these write-downs are the direct result of a previously announced strategic review of the Company's telephony, cable TV, radio and paging assets undertaken by new MITI management following the PLD Telekom acquisition.
Also included in the 1999 write-downs was a $45.7 million goodwill write-down, as reported in the third quarter, which related to the Company's telecommunications investments in China, which were terminated by agreement with China Unicom, as of December 3, 1999. The Company's current estimate of the total amount which will be received from the four terminated joint ventures is $90.1 million (at the December 31, 1999 exchange rates) of which $29.3 million has been received. Full distribution is expected by mid-2000. The Company's e-commerce joint venture in China was not affected by the termination of the telecommunications ventures and the Company is currently reviewing other similar investment opportunities in China in this sector.
Stuart Subotnick, MMG's President and Chief Executive Officer, said, ``In a difficult year, but one that brought us the successful acquisition of PLD Telekom Inc., Metromedia International Group continued to grow its businesses, adding subscribers and generating increased revenue. These results demonstrate we're aggressively executing our long-term growth strategy. In 2000, we'll be focused on growing our broadband and wireless operations, and accelerating growth throughout our businesses. We will develop Internet capability in our existing businesses and explore the expansion of Internet-related businesses in Eastern Europe. Our goal is to be a leading provider of communications services in the republics of the former Soviet Union and Eastern Europe.' |
