Illuminet Announces Record Second Quarter Results; Net Income Increases 225%
Before One-Time Acquisition Costs; Revenue increases 33% to $36.3 million
OLYMPIA, Wash., Jul 24, 2000 (BUSINESS WIRE) --
EPS up 175% to $0.22 per share before one-time acquisition costs
Illuminet Holdings, Inc. (Nasdaq:ILUM), which provides services such as call
routing, caller ID, wireless roaming, prepaid account management, and local
number portability to telecommunications carriers today announced financial
results for its second quarter ended June 30, 2000, which includes the results
of its acquisition of privately held National Telemanagement Corporation (NTC),
completed on June 30, 2000.
The NTC transaction was accounted for on a pooling basis and includes $3.4
million in one-time acquisition costs.
Revenue for the quarter increased 33% to $36.3 million, compared to $27.2
million in the second quarter of 1999. Growth in the quarter was driven by solid
performance in the company's core products of Network Services, which includes
Network Connectivity and Intelligent Network Services (access to database
services).
Net income before one-time acquisition costs in the second quarter increased
225% to $7.6 million or $0.22 per weighted-average diluted common share,
compared to $2.3 million or $0.08 per weighted-average diluted common share in
the second quarter of 1999. Including acquisition costs of $3.4 million, or
$0.10 per share, net income for the quarter was $4.2 million or $0.12 per
weighted-average diluted common share. Weighted-average diluted common earnings
per share for the two quarters are based upon 33.5 million shares and 27.9
million shares, respectively.
"We are pleased with what we accomplished this quarter. We continue to see solid
growth in our core services, evidenced in our calling name database which added
seven million lines during the quarter," said Roger Moore, President and Chief
Executive Officer. "The NTC transaction marks an opportunity for us take
advantage of acquisitions that add services utilizing our SS7 network and we are
especially pleased with their 46% revenue growth over the year ago quarter. We
will continue to place emphasis on expanding our business through select
acquisitions."
SECOND QUARTER REVENUE
Network Services contributed $34.3 million to revenues during the second quarter
of 2000, compared to $25.4 million in the second quarter of 1999, a 35%
increase. Within Network Services, Network Connectivity contributed $14.5
million in the second quarter of 2000, compared to $11.9 million in the second
quarter of 1999, a 22% increase; Intelligent Network Services contributed $14.4
million in the second quarter of 2000, compared to $9.8 million in the second
quarter of 1999, a 47% increase; and Wireless Prepaid and Unregistered Roaming
revenues contributed $5.4 million in the second quarter of 2000, compared to
$3.7 million in the second quarter of 1999, a 46% increase. This growth was due
to the addition of new carrier customers, increased market coverage and
increases in the subscriber base.
SECOND QUARTER EXPENSES
Carrier costs in the most recent quarter decreased on an absolute basis and as a
percentage of revenue, at $6.8 million or 19% of revenues, down from $7.5
million or 28% of revenues in the second quarter of 1999. This decrease is
attributable to continued efficiencies and favorable contract negotiations in
network operations.
Operating expense in the quarter was $9.6 million or 27% of revenue, compared to
$8.4 million or 31% of revenue in the second quarter of 1999. SG&A expense was
$5.1 million or 14% of revenue, compared to $4.0 million or 15% of revenue in
the second quarter of 1999. Depreciation was $3.8 million in the most recent
quarter or 10% of revenues, compared to $3.2 million or 12% of revenues in the
second quarter of 1999.
RECENT HIGHLIGHTS
-- In June, Illuminet completed the acquisition of National
Telemanagement Corporation, one of the largest prepaid
wireless providers in the country. In connection with the
transaction, Illuminet issued a total of 1.97 million shares
of common stock and options to NTC stockholders and employees.
-- The company announced deployment plans for "Number Portability
(NP) Data Download" service, the first offering of its kind in
the industry. The service, based on software developed by
Evolving Systems, Inc., is designed to help telecommunications
carriers stem rising costs associated with NP while
maintaining control over their network elements.
-- In April, Illuminet announced the intention to offer the
industry's first comprehensive Operations Support System (OSS)
interconnection services based on software and e-commerce
functionality from Quintessent(TM) Communications, Inc. These
services will facilitate the electronic exchange of
information between competitive local exchange carriers
(CLECs) and their trading partners for the efficient
fulfillment of service orders.
ABOUT ILLUMINET
Founded in 1981, Illuminet operates the largest Signaling System 7 (SS7) network
in the United States not affiliated with a major carrier and is a leading
provider of complementary intelligent network services 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 calling name delivery, calling card validation, wireless
roaming, prepaid wireless account management, number portability, network usage
measurement, network management, clearinghouse services, toll-free database and
other specialized database access functions. Illuminet's headquarters are at
4501 Intelco Loop, SE, Lacey, WA 98503; 360/493-6000; www.illuminet.com.
Editor's Note: Illuminet's logo is registered as a Service Mark with the United
States Patent and Trademark Office.
CONFERENCE CALL: Illuminet will host a conference call to discuss details of the
quarter. A replay of the conference call may be heard, beginning July 24, 2000
on the company's web site at www.illuminet.com/ir.
CAUTIONARY STATEMENT: Statements regarding expanding our business contained in
this release are forward-looking statements. "Forward-looking" statements, as
defined in the Private Securities Litigation reform Act of 1995 ("Act"), are
based on current expectations, estimates and projections. Such statements are
made pursuant to the safe harbor provisions of the Act. Statements that are not
historical facts, including statements about ILLUMINET's beliefs and
expectations are forward-looking statements. There are certain important factors
that could cause actual results to differ materially from those anticipated by
the forward-looking statements. For a discussion of the principal factors that
may cause actual results to be different, please refer to the company's
registration statement filed with the SEC on August 23, 1999 and declared
effective October 7, 1999 as well as the Company's 10-K filing on March 14,
2000. ILLUMINET undertakes no obligation to update publicly any forward-looking
statements whether as a result of new information, future events or otherwise.
(tables follow)
Illuminet Holdings, Inc. and Subsidiaries
Consolidated Income Statement
(In thousands, except share and per-share amounts)
Three months ended Six months ended
June 30, June 30,
2000 1999 2000 1999
-------- --------- --------- ---------
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
Revenues:
Network services $ 34,290 $ 25,433 $ 67,234 $ 48,748
Clearinghouse services 1,449 1,513 2,764 3,052
Network usage software
applications 518 271 788 502
-------- --------- --------- ---------
Total revenues 36,257 27,217 70,786 52,302
Expenses:
Carrier costs 6,813 7,515 13,325 14,460
Operating 9,612 8,439 18,776 15,978
Selling, general, and
administrative 5,062 3,996 9,950 7,698
Depreciation and
amortization 3,805 3,152 7,448 5,903
Acquisition costs 3,353 - 3,353 -
-------- --------- --------- ---------
Total expenses 28,645 23,102 52,852 44,039
-------- --------- --------- ---------
Operating income 7,612 4,115 17,934 8,263
Interest income 1,871 150 3,671 428
Interest expense (385) (532) (756) (1,016)
-------- --------- --------- ----------
Income before income taxes 9,098 3,733 20,849 7,675
Income tax provision 4,851 1,396 9,319 2,888
-------- --------- --------- ---------
Net income $ 4,247 $ 2,337 $ 11,530 $ 4,787
======== ========= ========= ==========
Earnings per share-diluted $ 0.12 $ 0.08 $ 0.33 $ 0.16
======== ========= ========= ==========
Weighted-average common
shares-diluted 33,548,112 27,935,313 33,530,380 27,893,165
========== ========== ========== ===========
Net Income prior to
acquisition costs $ 7,600 $ 2,337 $ 14,883 $ 4,787
======== ========= ========= ==========
Diluted EPS prior to
acquisition costs $ 0.22 $ 0.08 $ 0.43 $ 0.16
======== ========= ========= ==========
CONTACT: For More Information
Illuminet
Peter Wiederspan, 360/493-6165
investor_relations@illuminet.com
or
Media Contact
Illuminet
Penny Thomas, 360/493-6724
media_relations@illuminet.com
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