To All:
NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
VANCOUVER, WASHINGTON--GST Telecommunications, Inc. (AMEX:GST), a full
service telecommunications provider, today announced revenues of US $10.4
million for its third fiscal quarter, ended June 30, 1996, a 63.3 percent
year-over-year increase as compared with revenues from third fiscal quarter,
ended June 30, 1995, of $6.4 million. The company reported a third quarter
net loss of US $16.6, or $0.86 per share, compared to a 1995 net loss for the
third quarter of US $3.3 million, or $0.23 per share.
Robert Hanson, Chief Financial Officer for GST Telecommunications, noted,
"Telecommunications services revenues increased primarily as a result of
wholesale and long distance service revenues, and increased CLEC service
revenues generated by GST's networks. The increases in telecommunications
product revenues was a direct result of the April introduction of NACT's new
STX switch. As GST continues to expand its networks and broaden its service
offerings, we expect that its telecommunications service revenues will
continue to represent an increasingly larger percentage of the company's
consolidated revenues."
Third quarter operating milestones:
- GST awarded AT&T Submarine Systems the contract to construct Hawaiian
Island FiberNet (HI FiberNet), a 300-mile submarine fiber optic network,
linking six of the Hawaiian Islands that upon completion will be Hawaii's
largest
- GST signed an agreement with Intermedia Communications (ICI) to link the
GST and ICI frame relay networks to broaden the reach of GST service
capabilities and to provide seamless nationwide frame relay coverage
- The launch of the NACT STX switch, the company's latest platform- based
switching system
- The completion of an agreement with Tomen America Inc. to provide US $16
million in debt financing to complete projects in Tucson, Arizona and
Albuquerque, New Mexico
- Entrance into Washington and Texas marketplaces
The company has incurred significant operating and net losses as a result of
the development and operation of its networks. The company expects that such
losses will continue to increase as the company emphasizes the development,
construction and expansion of its networks and builds its customer base. The
company has financed, and expects to continue to finance its capital
expenditures, acquisitions and working capital requirements primarily through
vendor financing and the sale of equity and debt securities.
Capital expenditures for the nine months ended June 30, 1996 were US $44
million compared to US $25.3 million for nine months ended June 30, 1995. The
company estimates capital expenditures of US $125 million, US $225 million and
US $50 million for the fiscal years ending 1996, 1997 and 1998 respectively.
These expenditures will be utilized for the expansion, development and
construction of the company's networks, the acquisition and development of
switches and related equipment to facilitate the offering of advanced
telecommunications services and the f
urther development of internal management
and accounting systems.
GST's fiber optic networks currently serve 14 cities in California, Arizona
and New Mexico and its digital microwave network serves four of the Hawaiian
Islands. In addition, several networks are in various stages of development
that will serve 23 additional cities in California, Washington, Idaho, Utah,
Nevada, Texas, two additional Hawaiian Islands and Mexico.
As a result of the new regulatory environment, GST will be permitted to
provide local dial tone in addition to interstate and intrastate switched
access services.
Hanson added, "The new regulatory changes give GST the opportunity to
leverage its network infrastructure and service capabilities to expand its
addressable market. This improves its opportunity to participate in both the
local and long distance telecommunication markets in the US. To capitalize on
these opportunities, GST has accelerated the development and construction of
additional networks within its region and intends to install nine high
capacity digital switches in the latter part of 1996." |
