To: Anthony@Pacific who wrote (50259 ) 1/20/2000 1:00:00 PM From: allen menglin chen Respond to of 122087
Tony, Is CONV a buy under $10 after today's profit warning and downgrades? Thanks Allenbiz.yahoo.com Thursday January 20, 12:52 am Eastern Time Company Press Release SOURCE: Convergent Communications Services, Inc. Convergent Communications Comments on Fourth Quarter ENGLEWOOD, Colo., Jan. 19 /PRNewswire/ -- Convergent Communications(TM) announced today, based on preliminary assessment of its fourth quarter 1999 performance, the company expects its quarterly EBITDA to fall below the range of analysts' published estimates. The company's preliminary estimates for the quarter ended December 31, 1999, include a range of $48 million - $50 million for fourth quarter revenue, and 1999 year-end revenue of $160 million to $162 million, up from $24.8 million in the quarter ended December 31, 1998, and $61.6 million for the year ended December 31, 1998. The company's preliminary estimate of EBITDA(1) loss is in the range of $24 million to $27 million for the quarter ended December 31, 1999. ``We are accelerating our investment into our eBusiness Solutions and IP-based (Internet Protocol) infrastructure areas of our business which we believe will result in substantial value in the future,' said John R. Evans, chairman and chief executive officer for Convergent Communications. ``These investments are capitalizing on the emergence of broadband access and IP data services as the prime drivers of the next-generation of the Internet.' The increase in EBITDA loss from the prior quarter is primarily attributed to: -- $4 million - $6 million in costs associated with the company aligning its operations to capitalize on its Internet infrastructure opportunity. These costs include people, organizational activity and network expansion associated with the creation of the company's Strategic Management Units (SMUs). The company's three newly created SMUs are: Strategic Management Revenue Streams Units eBusiness Solutions eCommerce development, Web application development, Web hosting and Application Service Provider (ASP) partnering and hosting Enterprise Network Managed professional services, including Services management and monitoring services, and ownership of customers' premises networks under long-term service agreements, financing services, and data transport services over the company's IP + ATM network Enterprise Systems Internet, data, voice and video-related systems -- $2 million - $4 million shortfall against overall revenue expectations for the quarter as customer purchases softened prior to the year end. -- $1 million - $2 million increase in expenses due to reassigning engineering resources normally billable to customers as the company: * converted the service, delivery and billing systems acquired in various acquisitions to the company's state-of-the-art platform, ECLIPSE (Enterprise Customer Loyalty Integration Platform for Service Excellence); and * continued the rollout of its Cisco-based IP + ATM (Asynchronous Transfer Mode) multi-service switching platform. Evans said the company continues to anticipate revenue growth in 2000 within the framework of current expectations but expects that its investments into eBusiness Solutions and Enterprise Network Services will delay its break-even EBITDA until the latter part of 2001. The company will announce its fourth quarter and year-end 1999 results during the second week of March. Conference call information regarding the fourth quarter results will be made available on the company's Web site in early February. About Convergent Communications(TM) Convergent Communications Services, Inc., a wholly owned subsidiary of Convergent Communications, Inc. (Nasdaq: CONV - news), is a provider of broadband IP-based business communications solutions in 35 markets nationwide. Convergent provides a full range of e-business and Internet infrastructure services to small and medium sized enterprises. For more information on Convergent Communications, visit the company's Web site at converg.com . This news release is based on preliminary financial results, which are subject to further review and adjustment, and contains forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. (1) EBITDA consists of earnings before interest (net), taxes, depreciation, amortization and other income (expense). SOURCE: Convergent Communications Services, Inc. -------------------------------------------------------------------------------- More Quotes and News: Convergent Communications Inc (NasdaqNM:CONV - news) Related News Categories: earnings, telecom --------------------------------------------------------------------------------