* Access lines up 32% over 1Q 1998, 167% over 2Q 1997
* Local dial tone revenue up 29% over 1Q 1998, 289% over 2Q 1997
* Sales staff growth up 27% over 1Q 1998, 95% over 2Q 1997
VANCOUVER, Wash., Aug. 12 /PRNewswire/ -- Electric Lightwave, Inc.
(Nasdaq: ELIX), an integrated communications provider operating in
83 municipalities in the western U.S., today announced its financial results
for the quarter ended June 30, 1998.
Revenues for the quarter were $21.4 million, compared to $14.2 million in
the second quarter of 1997, a 51% increase. EBITDA loss (loss before interest,
taxes, depreciation and amortization) for the quarter was
$12.5 million which compares to a $7.0 million EBITDA loss for the second
quarter of 1997.
"We're especially pleased with the growth in access lines and local dial
tone revenue as well as our product bundles," said Electric Lightwave
President and Chief Operating Officer Dave Sharkey. "This shows the continued
strong demand for our products."
Sharkey added that more than 95% of the company's access lines are
on-switch, representing high margins and high asset utilization for Electric
Lightwave.
In addition, Electric Lightwave's recent announcement regarding its
agreement with Qwest (June 25) complements Electric Lightwave's
facilities-based business strategy in the West, and gives the company the
ability to offer high-speed, point-to-point bandwidth, Internet, Frame Relay,
ATM and Transparent LAN Services to business customers in a number of major
markets across the country.
"This agreement is significant because it provides the framework for us to
reduce leased long-haul network costs approximately 25%," said Sharkey.
Backoffice Implementation
As announced in its July 13 news release, the company's implementation of
new business systems that enables the integration of order flow, provisioning,
network monitoring and billing systems has had a temporary impact on its
ability to ramp-up order processing. This has led to slower than expected
revenue growth in the second quarter. However, with productivity improvement
doubling over the last three months, Electric Lightwave's management team is
very confident that revenue will to return to quarterly double-digit growth
rates later in the year.
"We've implemented a scaleable integrated back office system that can
support our targeted growth for the forseeable future," Sharkey said. "This
system will truly be a competitive advantage in our ability to provide high
quality, low cost services."
Revenue Components
Local dial tone revenue and enhanced services revenue continue to be the
fastest growing components of Electric Lightwave's revenue stream. Local dial
tone services revenue increased to $7.8 million, up 289% over the $2.0 million
in the second quarter of 1997 and up from $6.0 million, or 29% over the second
quarter of 1998. Enhanced services revenue, which includes frame relay,
Internet and LAN-to-LAN service revenue totaled $3.4 million, up 50% from the
$2.3 million in the second quarter of 1997 and up from $3.1 million, or 10%
over the first quarter of 1998.
The company grew its access lines by 167%, from 20,413 in the second
quarter of 1997 to 54,490 in the second quarter of 1998. Access line growth
was up 32% from the first quarter total of 41,270.
Electric Lightwave is a facilities-based integrated communications
provider offering data and Internet access solutions, local, long distance,
network access, videoconferencing, prepaid services and broadband transport
services to businesses nationwide. ELI currently serves 83 municipalities with
54,490 local access line equivalents, 2,656 route miles and 682 on-net
buildings connected as of June 30, 1998. The Company has interconnected its
market clusters with facilities-based owned and leased long-haul fiber optic
networks.
Except for any historical information, the matters discussed in this press
release contain forward-looking statements that involve risks and
uncertainties that are described in the company's filings with the Securities
and Exchange Commission.
Electric Lightwave, Inc.
Statements of Income
(In thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1998 1997 1998 1997
Revenues $21,443 $14,246 $41,500 $24,765
Operating Expenses:
Network Access 9,860 7,016 19,072 11,946
Sales and Marketing 5,735 3,761 10,675 6,667
Depreciation and Amortization 3,780 2,786 7,664 5,603
Other Operating Expenses 18,381 10,426 34,062 20,363
Total Operating Expenses 37,756 23,989 71,473 44,579
Loss from Operations (16,313) (9,743) (29,973) (19,814)
Interest Expense, Net 1,467 211 2,211 302
Net Loss Before Income
Taxes and Cumulative Effect
of a Change in
Accounting Principle (17,780) (9,954) (32,184) (20,116)
Income Tax Benefit (3,022) -- (5,471) --
Net Loss Before Cumulative
Effect of a Change in
Accounting Principle (14,758) (9,954) (26,713) (20,116)
Cumulative Effect of Change
in Accounting Principle -- -- 2,817 --
Net Loss $(14,758) $(9,954) $(29,530) $(20,116)
EBITDA $(12,533) $(6,957) $(22,309) $(14,211)
Weighted average shares
outstanding 49,694 41,685 49,690 41,685
Net Loss Before Cumulative
Effect of Change in Accounting
Principle per Common Share:
Basic $(0.30) $(0.24) $(0.54) $(0.48)
Diluted $(0.30) $(0.24) $(0.54) $(0.48)
Net Loss Per Common Share:
Basic $(0.30) $(0.24) $(0.59) $(0.48)
Diluted $(0.30) $(0.24) $(0.59) $(0.48)
Selected Financial & Operating Data
(In thousands except selected operating data)
June 30, June 30, March 31,
1998 1997 1998
Selected Financial Data
Property, Plant
& Equipment - Owned $396,080 $235,953 $352,062
Property, Plant
& Equipment - Leased 108,541 73,042 105,226
Total $504,621 $308,995 $457,288
Selected Operating Data
Markets 9 5 6
Municipalities 83 n/a 75
Route Miles 2,656 1,528 2,525
Fiber Miles 153,002 107,876 145,350
Buildings Connected 682 509 631
Switches:
Voice 7 5 5
Internet Routers 18 8 18
ATM 9 - 9
Frame Relay 22 13 22
Access Lines 54,490 20,413 41,270
Access Lines/Switch 7,784 4,083 8,254
% on Switch 98% 94% 97%
Employees 841 485 670
Customers 1,330 991 1,226
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,
jack_hardy@eli.net, both of Electric Lightwave, Inc.
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