Globix Reports Fiscal First Quarter Results
NEW YORK – January 25, 2001
Globix Corporation (NASDAQ: GBIX) today announced record financial results for its fiscal first quarter 2001, which ended December 31, 2000.
For the quarter, Globix posted record Internet revenue of $23.6 million, a 239 percent increase overrevenue of $7.0 million in the first quarter of 2000. Revenue totaled $26.2 million, an increase of 63percent over $16.1 million in the first quarter of 2000. Revenue from Server Sales and Integrationwas $2.6 million for the quarter, representing 10 percent of total revenue.
EBITDA loss (loss before net interest expense, income taxes, depreciation and amortization, non-recurringlease termination and other equipment-related costs) was $15.2 million for the quarter,compared to $13.6 million for the same quarter last year and in line with the $15.3 million for fourthquarter of 2000, which ended September 30.
For the quarter, net loss attributable to common stockholders, exclusive of the $38.1 million non-recurringlease termination and other related equipment costs and the $2.3 million cumulativeeffect of the adoption of SAB No. 101, was $34.6 million, or $0.93 per share based on 37.3 millionshares.
‘We are focused on supplanting those dot-com customers that have higher credit exposure withwell-established customers grounded in traditional or broad-based businesses. Enterprise clientsnow represent 69 percent of our monthly recurring revenue, up from 65 percent in fiscal fourthquarter, which ended September 30, 2000,’ said Marc H. Bell, Chairman and CEO. ‘Nevertheless,we do expect to experience longer sales cycles as enterprise and larger dot-com companies typicallyundergo a more extensive decision-making process when choosing a vendor for their outsourcingneeds, especially in light of the recent economic slowdown.’
‘During our November 16 conference call, we discussed plans that would take us not only toprofitability but also to free-cash-flow positive. Management, the board of directors and myself arepleased with our progress to date on implementing this plan and are confident that we will besuccessful in achieving our goals, even in today’s difficult economic and capital-marketenvironment,’ said Brian Reach, Chief Financial Officer. ‘We are realistic about the state of theeconomy and the lengthening of sales cycles and continue to gauge our guidance accordingly.’
Recent Events Partnerships: Signed an agreement with Telefónica DataCorp to jointly market each other’sservices in the markets not currently served. Capital Expenditure Modifications: Terminated the lease for a future Boston data center.Reduced commitments for surplus power and environmental equipment related to the datacenter expansion. Financing: Received commitments to date for approximately $40 million in financingarrangements from several vendors.Customers: Ended December 31, 2000, with 3,442 customers, versus 3,286 customers as ofSeptember 30, 2000.Equity and Debt Purchase by CEO Marc Bell: Exercised options to purchase approximately 1.4million shares of common stock and also purchased $6.5 million of the company’s 12.5 percentsenior notes on the open market.Globix WebConferencing: Announced a new live, interactive streaming audio and videoconferencing service.New York Encoding Studio: Unveiled a new state-of-the-art streaming media encoding studio inthe Globix New York SuperPOP.
The following business outlook contains forward-looking statements intended to provide the high- andlow-end range of management’s current expectations. These forward-looking statements are subject tonumerous risks and uncertainties. As a result, actual results may differ materially from what is expected.
Globix estimates revenue for the second quarter 2001 to be in the range of $25 to $26 million. EBITDA loss is expected to be approximately $16 to 17 million for the second quarter of 2001. Net interest expense is estimated to be approximately $17 million for the second quarter of 2001. Net interest expense is dependent in part on the timing of capital expenditures, future borrowings, interest rates and cash balances.
Globix anticipates that despite the recent economic slowdown, it will achieve significant growth forthe full fiscal year 2001:
Revenue for fiscal year 2001 is expected to be approximately $110 million to $120 million. EBITDA loss excluding the $38.1 million lease termination and other related equipment costs and $2.3 million cumulative effect of adopting SAB No. 101 for fiscal year 2001 is expected to be between $65 million and $70 million. Capital expenditures, working capital and capital lease payments are estimated to be $160 million.
‘Our growth in 2001 will be driven by our world-class, one-stop outsourcing model, the addition ofadditional data center space, our continuance to forge strategic relationships and our focus on our corecustomer ‘ the enterprise,’ Bell said. ‘We believe that as Internet usage continues to grow and asbusinesses continue to outsource their Web applications that are not their core competencies, Globix isuniquely positioned to navigate through the short-term gyrations in our industry and the economy.’
Globix is a leading provider of advanced Internet hosting, network and applications solutions for business. Globix delivers services via its secure state-of-the-art Internet DATA Centers, its high-performance global backbone and content delivery network, and its world-class technical professionals. Globix provides businesses with cutting-edge Internet resources and the ability to deploy, manage and scale mission-critical Internet operations for optimum performance and cost efficiency.