Internap Reports First Quarter 2013 Financial Results
- Revenue of $69.7 million, up 4% versus the first quarter of 2012;
- Segment profit(1) of $36.8 million grew 3% year-over-year;
- Adjusted EBITDA(2) of $14.1 million increased 16% versus the first quarter of 2012;
- Adjusted EBITDA margin of 20.3%, up 200 basis points year-over-year;
- Announces new "cloudy colo" services, delivering on-demand cloud and colocation hybridization via integrated portal.
ATLANTA, April 25, 2013 /PRNewswire/ -- Internap Network Services Corporation (NASDAQ: INAP), a provider of intelligent IT Infrastructure services, today announced financial results for the first quarter of 2013. "We begin 2013 with solid first quarter results reflecting our continued shift to data center services including colocation, hosting and cloud offerings. In the first quarter, we successfully drove sequential and year-over-year growth in our data center services segment while also delivering record data center services segment margin," said Eric Cooney, President and Chief Executive Officer of Internap. "With compelling new offerings planned for 2013, such as our recent 'cloudy colo' announcement, we expect to further differentiate Internap's data center services and sustain long-term profitable growth for the business." First Quarter 2013 Financial Summary
YoY QoQ
1Q 2013 1Q 2012 4Q 2012 Growth Growth
---------- --------- --------- -------- ---------
Revenues:
Data center
services $ 44,392 $ 39,938 $ 43,716 11% 2%
IP services 25,307 27,090 26,032 -7% -3%
---------- --------- ---------
Total Revenues $ 69,699 $ 67,028 $ 69,748 4% 0%
Operating
Expenses $ 68,879 $ 65,320 $ 67,699 5% 2%
GAAP Net (Loss)
Income $ (1,643) $ 107 $ 21 -1636% -7924%
Normalized Net
Income(2) $ 242 $ 1,554 $ 2,107 -84% -89%
Segment Profit $ 36,829 $ 35,874 $ 36,163 3% 2%
Segment Profit
Margin 52.8% 53.5% 51.8% -70 BPS 100 BPS
Adjusted EBITDA $ 14,145 $ 12,233 $ 14,964 16% -5%
Adjusted EBITDA
Margin 20.3% 18.3% 21.5% 200 BPS -120 BPS
Revenue -- Revenue totaled $69.7 million compared with $67.0 million in the first
quarter of 2012 and $69.7 million in the fourth quarter of 2012.
-- Data center services revenue improved 11% year-over-year and 2%
sequentially to $44.4 million. Both the year-over-year and sequential
increases were attributable to increased sales of colocation in
company-controlled data centers and favorable growth in hosting and cloud
services.
-- IP services revenue totaled $25.3 million, a decrease of 7% compared with
the first quarter of 2012 and 3% sequentially, as traffic growth was more
than offset by per unit price declines in IP and the loss of legacy
contracts. Net (Loss) Income -- GAAP net loss was $(1.6) million, or $(0.03) per share, compared with
GAAP net income of $0.1 million, or $0.00 per share, in the first quarter
of 2012 and $0.0 million, or $0.00 per share, in the fourth quarter of
2012.
-- Normalized net income, which excludes the impact of stock-based
compensation expense and items that management considers non-recurring,
was $0.2 million, or $0.00 per share, compared with $1.5 million, or
$0.03 per share, in the first quarter of 2012. Normalized net income was
$2.1 million or $0.04 per share, in the fourth quarter of 2012. Segment Profit and Adjusted EBITDA -- Segment profit totaled $36.8 million in the first quarter, an increase of
3% year-over-year. Sequentially, segment profit increased 2%. Segment
margin1 was 52.8%, a decline of 70 basis points compared with the first
quarter of 2012. Segment margin increased 100 basis points compared with
the fourth quarter of 2012.
-- Segment profit in data center services was $21.7 million, or 49% of data
center services revenue. IP services segment profit was $15.1 million, or
59.6% of IP services revenue. Data center services segment profit
increased 15% year-over-year and 7% sequentially. An increasing
proportion of higher-margin services, specifically colocation sold in
company controlled data centers, hosting and cloud services, benefited
data center services segment profit year-over-year and sequentially. Data
center services segment margin increased 150 basis points year-over-year
and 260 basis points sequentially. IP services segment profit decreased
11% year-over-year and 5% sequentially. Lower IP transit revenue and the
loss of legacy contracts drove the year-over-year and sequential
decreases in segment profit. IP services segment margin decreased 280
basis points year-over-year and 140 basis points sequentially.
-- Adjusted EBITDA totaled $14.1 million in the first quarter, a 16%
increase compared with the first quarter of 2012 and a 5% decrease from
the fourth quarter of 2012. Adjusted EBITDA margin was 20.3% in the
first quarter of 2013, up 200 basis points year-over-year and down 120
basis points sequentially. The year-over-year increase in Adjusted
EBITDA was attributable to increased segment profit in our data center
services segment. Sequentially, seasonally higher general and
administrative costs outweighed the quarter-over-quarter increase in
segment profit. Balance Sheet and Cash Flow Statement -- Cash and cash equivalents totaled $34.6 million at March 31, 2013. Total
debt was $161.7 million, net of discount, at the end of the quarter,
including $57.1 million in capital lease obligations.
-- Cash generated from operations for the three months ended March 31, 2013
was $6.1 million. Capital expenditures over the same period were $7.4
million. Recent Operational Highlights Historical trends of key financial and operational metrics can be found in a supplementary data schedule on Internap's website at ir.internap.com. -- We had approximately 3,700 customers at March 31, 2013.
-- Internap was named as one of the Top 40 Innovative Technology Companies
in Georgia by the Technology Association of Georgia (TAG). TAG'S Top 40
Awards recognize Georgia-based technology companies for their innovation,
financial impact and efforts at spreading awareness of Georgia's
technology initiatives throughout the U.S. and globally.
(1) Segment profit and segment margin are non-GAAP financial measures and are defined in an attachment to this press release entitled "Non-GAAP (Adjusted) Financial Measures." Reconciliations between GAAP and non-GAAP information related to segment profit and segment margin are contained in the table entitled "Segment Profit and Segment Margin" in the attachment.
(2) Adjusted EBITDA and Normalized Net Income (Loss) are non-GAAP financial measures and are defined in an attachment to this press release entitled "Non-GAAP (Adjusted) Financial Measures." Reconciliations between GAAP information and non-GAAP information related to Adjusted EBITDA and Normalized Net Income (Loss) are contained in the tables entitled "Reconciliation of Income (Loss) from Operations to Adjusted EBITDA," and "Reconciliation of Net Income (Loss) and Basic and Diluted Net Income (Loss) Per Share to Normalized Net Income (Loss) and Basic and Diluted Normalized Net Income (Loss) Per Share" in the attachment. Conference Call Information: Internap's first quarter 2013 conference call will be held today at 5:00 p.m. ET. Listeners may connect to a webcast of the call, which will include accompanying presentation slides, on the investor relations section of Internap's web site at ir.internap.com. The call can also be accessed by dialing 866-515-9839. International callers should dial 631-813-4875. An online archive of the webcast presentation will be available for one month following the call. An audio-only replay will be accessible from Thursday, April 25, 2013 at 8 p.m. ET through Wednesday, May 1, 2013 at 855-859-2056 using the replay code 35977042. International callers can listen to the archived event at 404-537-3406 with the same code. About Internap Internap provides intelligent IT Infrastructure services that combine unmatched performance and platform flexibility to enable our customers to focus on their core business, improve service levels and lower the cost of IT operations. Our unique trio of route-optimized enterprise IP, TCP acceleration and a global content delivery network improves website performance and delivers superior end-user experiences. Our scalable colocation, hosting, private cloud, public cloud and hybrid offerings provide enterprises the flexibility to adapt to changing business needs and future-proof their IT Infrastructure. Since 1996, thousands of companies have entrusted Internap with the protection and delivery of their online applications. Transform your IT Infrastructure into a competitive advantage with IT IQ from Internap. For more information, visit internap.com, our blog at internap.com or follow us on Twitter at twitter.com. Forward-Looking Statements |
