Operations Update: Provisioning System Implementation Will Temporarily Impact
Revenue Growth Despite Strong Customer Demand
VANCOUVER, Wash., July 13 /PRNewswire/ -- Electric Lightwave Inc.
(Nasdaq: ELIX) management believes that recent fluctuations in its share price
may be due to market confusion surrounding Citizens Utilities'
(NYSE: CZN, CZNPr) separation announcement of May 18, 1998.
That announcement stated that Citizens' Board of Directors had authorized
the separation of Citizens' telecommunications businesses and its public
services businesses into two stand-alone, publicly traded companies.
The announcement further stated that the separation was being made to
unlock shareholder value and that Citizens' telecommunications businesses and
public services businesses will be better able to pursue their own strategies
and compete more effectively as separate companies. Further, the separation
will enable both businesses to take full advantage of opportunities to enhance
value. Citizens' telecommunications businesses consist principally of wholly
owned local exchange subsidiaries with approximately 900,000 access lines in
12 states and an 83% interest in Electric Lightwave.
Daryl A. Ferguson, Electric Lightwave's chief executive officer and
Citizens president and chief operating officer said, "The separation
announcement is favorable for Electric Lightwave since its largest shareholder
will transition from a diversified utility into a company with a singular
focus on telecommunications. In no way did this announcement suggest any
limitation on Electric Lightwave's ability to remain independent or limit its
ability to take any future strategic actions to enhance shareholder value."
Operations Update
Electric Lightwave continues its successful cut over to a new business
systems platform. This platform enables the integration of order flow,
provisioning, network monitoring and billing systems. Integration of an
enhanced order flow, provisioning and billing system will occur later in 1998.
Dave Sharkey, president and chief operating officer of Electric Lightwave
said, "Upon completion, we will have the one thing that every competitive
local exchange carrier wants: a scaleable provisioning system that can handle
any level of increased business from the same platform."
At the time of its first quarter earnings release on May 4, Electric
Lightwave indicated that the installation of this new provisioning system
would probably have a temporary impact on the company's ability to ramp-up its
order processing. While demand for services remains strong, as evidenced by
the company's growing revenue backlog, revenues for the second, third, and
fourth quarters are likely to be approximately 8%, on average below analysts'
consensus estimates. Electric Lightwave's gross margins remain at industry
highs, and revenues are expected to return to double-digit quarterly growth
rates late in the year.
Sharkey added: "We are experiencing very strong demand, so this is not a
demand issue -- it is a temporary constraint to our provisioning ability. We
continue to have confidence in our strategy and ability to execute our
business plan."
The company believes that it has the right combination of talent and
resources to meet the strong demand for its voice, network and enhanced data
products and in its ability to attract and retain a significant share of its
target market. This was evidenced by the company's recent agreement with
Qwest Communications, which was another execution step in its original
business plan.
Based in Vancouver, Wash., Electric Lightwave is a full-service integrated
communications provider offering local and long distance telephone service,
videoconferencing, prepaid services, broadband transport, data and Internet
access services to business customers throughout the United States. Electric
Lightwave's highly rated Internet backbone was recently ranked third in the
nation for "Best Internet Value" by Boardwatch Magazine. Visit Electric
Lightwave on the Worldwide Web at http://www.eli.net.
Statements contained in this news release regarding financial results and
other planned events are forward-looking statements and subject to
uncertainties and risks including, but not limited to, demand for Electric
Lightwave's products and services and the company's ability to successfully
implement its strategies, each of which may be impacted by -- among other
things -- economic, competitive or regulatory conditions. These and other
applicable risks are summarized in the company's Form 10-K Annual Report for
the fiscal year ended December 31, 1997.
SOURCE Electric Lightwave, Inc.
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Related links:
http://www.eli.net
CONTACT:
investors, John Unverferth, 360-816-3217, or
john_unverferth@eli.net, or media, Jack Hardy, 360-816-3602, or
jack_hardy@eli.net, both of Electric Lightwave, Inc.
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