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Date: 08/18 19:14 EST
IIJ ANNOUNCES FIRST QUARTER RESULTS FOR THE PERIOD ENDED JUNE 30, 1999
TOKYO and NEW YORK, Aug 18, 1999 /PRNewswire via COMTEX/ -- Internet
Initiative Japan Inc. (Nasdaq: IIJI) ("IIJ"), Japan's leading
Internet-access and Internet-related services provider, today announced
the results of its operations for the first quarter ending June 30,
1999. All figures were unaudited and prepared in accordance with
generally accepted accounting principles in the United States for
interim financial information.
1Q99 Results: Year-over-Year and Sequential Comparison
Highlights
-- Revenues increased 76.8% YoY and 2.6% QoQ to JPY5,395M (or
US$45M).
-- Total subscribers to Dedicated Access Services increased 26.6%
YoY to
1,656 and was unchanged QoQ.
-- Due to demand for higher bandwidth, total bandwidth contracted
for IP
Service increased 78.0% YoY and 32.7% QoQ to 730 Mbps.
-- Total user for Dial-up Access Services, including OEM,
increased 71.4%
YoY and 26.2% QoQ to 74,076.
-- Total international bandwidth was increased to 620 Mbps, from
245 Mbps
at the end of June 1998 and 445 Mbps at the end of March 1999.
1Q99 Operating Highlights Upgrading International Bandwidth to 620Mbps:
One of IIJ's network strategies is to focus on the development of its
international network, with the strong belief that establishing a
high-capacity IP network and providing high-quality services will be
IIJ'skey differentiating factor. IIJ's total international bandwidth
between Japan and the U.S. was increased to 620 Mbps at the end of June
1999 compared to 245 Mbps at the end of June 1998 and 445 Mbps at the
end of March 1999. During 1Q99, IIJ focused on its expansion plan to
increase its network bandwidth and the number of lines connected to the
major IXs (Internet Exchange) in the United States.
Launching Service Level Agreement (SLA): To distinguish its service
from competitors and increase its competitive lead, IIJ launched in
June 1999 the industry's first SLA (Service Level Agreement) in Japan,
guaranteeing a specified level of customer satisfaction. IIJ's SLA
program is designed to enhance stability and reliability by
incorporating quantitative benchmarks in the measurement of Internet
service quality. The level of service is measured according to
objective criteria that IIJ has established for three items --
availability, latency, and outage notification. Under the program, if
service quality falls below predefined target levels, IIJ gives the
customer credit against the amount invoiced for the services. The SLA
program entails no additional charges to customers.
IIJ and GTE Internetworking Announce Strategic Alliance: To offer
expanded Internet services on a global basis, IIJ formed inJune 1999 a
strategic and commercial alliance with GTE Internetworking based on a
memorandum of understanding. IIJ and GTE Internetworking will engage in
joint initiatives for network interconnection and related
infrastructure services, including enhanced customer support. IIJ and
GTE Internetworking will provide highly-reliable, seamless services and
facilitate the delivery of a consistent portfolio of value-added
services important to multinational corporations.
Initial Public Offering: A total of 8,140,000ADSs were offered through
an Initial Public Offering in August, 1999. 7,200,000 ADSs or ADS
equivalents, including those issued upon the exercise of an
overallotment option, were issued and offered byIIJ. The remaining ADSs
were offered by selling shareholders. Total outstanding shares after
the offering amounted to 44,960,000 ADSs or ADS equivalents. 2,000 ADSs
represent one share of common stock of IIJ. Net proceeds before
expenses to IIJ from the IPO were $154,440,000. IIJ plans to use the
proceeds 1) to further develop its network, including international
capacity and the building of data centers, 2) for investments in
affiliated companies, including Crosswave Communications Inc.
("Crosswave")(1), 3) to repay the current portion of long-term
borrowings, and 4) for general corporate purposes.
Year 2000 Compliance: As of June 30, 1999, IIJ had completed its Y2K
compliance plans in all material respects on its high-priority systems
and equipment that are essential to its business. The remaining
high-priority systems and equipment, such as those that IIJ has
installed at customers' premises, are expected to become year 2000
compliant by September 30, 1999. IIJ is currently undertaking the Y2K
modification and testing of low-priority systems and equipment which
are not essential to its business operations. The Company expects these
activities to be completed by September 30, 1999. Total costs and
expenses incurred, on a consolidated basis, for Y2K compliance
operations were 2.3 million yen for the year ended March 31, 1999. IIJ
also anticipates future costs and expenses related to its Y2K
compliance activities, on a consolidated basis, to be approximately
JPY60.7 million.
Business Outlook The following are forward-looking statements based on
IIJ's current expectations and subject to significant risks and
uncertainties. Actual results may differ materially from those
contained in such forward-looking statements. Information as to those
factors that could cause actual results to vary can be found in IIJ's
Initial Public Offering Registration Statement filed with the United
States Securities and Exchange Commission on July 13, 1999, as amended,
or Risk Factors section of the Offering Prospectus.
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