Globix Corporation Announces Third Quarter ResultsNEW YORK – August 12, 1998Globix Corporation (Nasdaq: GBIX) today announced results for the three and nine months which ended June 30, 1998.
Revenues for the three months ending June 30, 1998 were $5,695,816 compared with $4,943,114 for the three months ending June 30, 1997. For the nine months ending June 30, 1998, revenues were $14,786,990, compared with $13,868,965 for the nine months ending June 30, 1997. Gross profit margins increased from approximately 25% for the three months ending June 30, 1997 to approximately 33% for the three months ending June 30, 1998. Gross profit margins increased from approximately 23% for the nine months ending June 30, 1997 to approximately 35% for the nine months ending June 30, 1998. The revenue increase for the three months ending June 30, 1998 was attributable to a increase in sales of Internet and Media which had revenues of $1,637,140 for the three months ending June 30, 1998, compared with $704,630 for the three months ending June 30, 1997.
Marc H. Bell, President and CEO, stated ‘This quarter was a success for Globix in terms of our growth of our Internet related sales and the increase in our services customer base which is now over 600 medium and large businesses.’
Earnings before Interest, Taxes, Depreciation and Amortization (‘EBITDA’) for the three months ending June 30, 1998 was a loss of $1,113,487 as compared to a loss of $241,861 for the three months ending June 30, 1997. The EBITDA loss increase was primarily attributed to an increase in Selling, General and Administrative expenses in anticipation of Globix’s future expansion plans. The major cause for the increase in Selling, General and Administrative expenses was an increase in payroll and advertising expenditures. The number of employees increased from 72 to 120 during the period. While payroll expenses, which include additional sales and marketing personnel, and the costs of an expanded advertising campaign have increased, they should have a positive long-term effect on revenues. EBITDA for the nine months ending June 30, 1998 was a loss of $1,359,634 as compared to a loss of $1,045,447 for the nine months ending June 30, 1997. The net loss for the three months ending June 30, 1998 was $4,070,003 or $1.16 per share, as compared to a loss of $457,516 or $0.15 per share for the three months ending June 30, 1997. For the nine months ending June 30, 1998, the net loss was $4,940,679 or $1.42 per share, as compared to $1,540,397 or $0.51 per share for the nine months ending June 30, 1997.
In a separate matter, the Company has requested an effective date of August 12, 1998, for a registration statement relating to an exchange offer pursuant to which holders of 13% Senior Notes due 2005 previously issued by the Company on April 30, 1998 (the ‘Existing Notes’), may tender their Existing Notes for an equivalent principal amount of new 13% Senior Notes due 2005.
The Company will host a conference call to discuss financial results on Thursday, August 13th at 11:30 A.M. Eastern Standard Time. In the United States, the number is 800-844-8633 and from overseas the number is 404-209-4000. The password is 3925#. The conference call will be rebroadcast at 4:00 P.M. Eastern Standard Time at the same phone numbers.
About GlobixGlobix 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.
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