Internap Reports 15th Consecutive Quarter of Revenue Growth
Tuesday April 29, 4:13 pm ET
ATLANTA--(BUSINESS WIRE)--April 29, 2003--Internap Network Services Corporation (NASDAQ: INAP - News), the leading provider of intelligent routing services over the Internet, today reported fiscal first quarter results for the period ended March 31, 2003.
Revenue totaled $34.2 million, an increase of 4.8% compared to the first quarter 2002. This performance marked the company's 15th consecutive quarter of year-over-year revenue growth.
Internap achieved positive EBITDA, on a consolidated basis, of $1.1 million in the first quarter, compared with negative EBITDA of $5.2 million in the comparable quarter of 2002.
The company has previously disclosed EBITDA, normalized for the effect of restructuring expense; under that definition, EBITDA for the first quarter of 2003 was a record $1.8 million.
Under this definition, EBITDA improved on a consecutive quarterly basis from $1.5 million in the fourth quarter of 2002. EBITDA, net of restructuring charges in the first quarter of 2003, was within management's guidance of $1.5 to $2.5 million in the quarter.
Net cash used in operating activities, the most directly comparable measure under Generally Accepted Accounting Principles (GAAP) was $2.9 million.
Internap's net loss, computed in accordance with GAAP, was $12.4 million in the first quarter, or $0.08 per share, compared to management's prior guidance of $12.0 to $13.0 million.
Net loss improved by $1.6 million, or $0.01 per share, compared with a $14.0 million loss in the fourth quarter of 2002.
"Internap's sustained revenue growth, expanding market share and increasing base of blue-chip customers are strong indicators of our ability to execute in a challenging market," said Gregory A. Peters, Internap's president and chief executive officer.
Quarterly Results:
The installed base grew to 1,389 customers as of March 31, 2003, an increase of 116 net new customers in the quarter.
Among the new customers were: Electronic Data Systems, CNET, Toyota Motors USA, Spirit Airlines and Thomson & Thomson. Existing customers that expanded their service included: Reuters/Radianz, Veritas, Standard & Poor's, Starz Encore and Hewlett-Packard.
Direct margin improved to 45%, compared to 26% in the first quarter 2002.
Annualized revenue per employee increased to more than $413,000 per employee in the quarter ended March 31, 2003, the 8th consecutive quarterly improvement.
Excluding restructuring costs, operating expenses totaled $44.8 million, a decline of more than $12.6 million, or 22%, compared to the first quarter 2002.
Net days sales outstanding improved to 35 days in the first quarter, down from 38 days last quarter.
Net use of cash during the first quarter was $6.2 million, including $3.9 million in restructuring payments and certain one-time charges. Cash use was in line with management's guidance of $5.5 million to $6.5 million.
"With the majority of our restructuring behind us, improving margins and reduced operating expenses will enable the company to achieve free cash flow this year," said Robert Jenks, Internap's chief financial officer.
Financial guidance:
With increasing visibility into 2003 results, management has extended its outlook to encompass the remainder of the year, as follows:
Full year revenue growth of 5% to 7%, compared to 2002.
Achieve free cash flow by year-end 2003.
Non-GAAP Financial Reporting Metrics
The company has historically provided financial metrics, some of which are based on GAAP and others that are not prepared in accordance with GAAP (non-GAAP).
Recent legislative and regulatory changes encourage the use of GAAP financial metrics and require companies to explain why non-GAAP financial metrics are relevant to management and investors.
To the extent that non-GAAP financial metrics are deemed to be relevant, companies are required to reconcile those metrics to the most directly comparable GAAP financial metrics.
As a result of these changes, the company has conducted a review of its GAAP and non-GAAP financial metrics and has elected to eliminate certain non-GAAP metrics, which it had provided historically.
However, the company will continue to provide EBITDA metrics, a non-GAAP measure. Attached to this release is the reconciliation of EBITDA to cash flow used in operating activities.
Conference Call Information:
Internap's first quarter teleconference will be held today beginning at 5:00 p.m. Eastern. The dial-in numbers are 800-299-7089 for domestic calls, and 617-801-9714 for international calls. The passcode is 7287588.
The simultaneous webcast will be available from the investor relations section of the Web site at: www.internap.com.
Internap will provide a replay of the teleconference through Friday, May 9, 2003. The replay numbers are 888-286-8010 for domestic calls, and 617-801-6888 for international calls. The passcode for the replay is 125033.
About Internap
Internap provides customers with certainty over the Internet through its patented route management technology and service guarantees. This managed IP service intelligently routes data across the major Internet backbones through a single connection from a customer's network to one of Internap's Service Points. Internap's customers bypass congestion points on the Internet, avoiding packet loss, latency and other difficulties that can plague conventional Internet connectivity. Founded in 1996 in Seattle, Internap offers services in numerous key markets throughout the United States, Europe and Japan including Atlanta, Boston, Chicago, London, Los Angeles, New York, San Francisco, San Jose, Seattle, Tokyo and Washington, DC. Internap® and P-NAP® are registered trademarks of Internap. All other trademarks and brands are the property of their respective owners. For more information, visit www.internap.com. |
