Otelco Reports Second Quarter 2008 Results
2008-08-05 15:00:00
Otelco Reports Second Quarter 2008 Results
ONEONTA, Ala.–(EMWNews)–Otelco Inc. (NASDAQ: OTT)(TSX: OTT.un), the sole wireline telephone
services provider in several rural communities in Alabama, Maine and
Missouri, today announced results for its second quarter ended June 30,
2008. Key quarterly highlights for Otelco include:
-
Total revenues of $17.7 million.
-
Operating income of $5.0 million.
-
Adjusted EBITDA (as defined below) of $8.5 million.
“Our business provided solid revenue and
subscriber growth which resulted in a strong financial performance for
second quarter,” stated Mike Weaver, President
and Chief Executive Officer of Otelco. “Key
operating highlights include continued growth in access line equivalents
when compared to last quarter and last year, driven by increases in both
RLEC data lines and CLEC voice and data lines. Our bundled product
offerings have increased to approximately 40% of our eligible customers.
“We also delivered solid increases in revenue
and operating income, which increased 3.2% and 14.1%, respectively, from
the year-ago period and 3.6% and 10.8% respectively for the first half
of 2008 compared to the same period in 2007. Adjusted EBITDA was $8.5
million for the quarter and $17.3 million year-to-date, a 1.6% and 1.7%
increase from the comparable periods last year,”
added Weaver. “Bottom line performance also
improved from the year-ago period as we reported net income of $0.4
million for the quarter and $0.8 million year-to-date compared to a net
loss of $0.1 million for the second quarter 2007 and a net loss of $0.2
million for the first half of 2007. We invested over $1.5 million in our
infrastructure to serve both our current and future customers and
delivered our fourteenth consecutive IDS distribution. That demonstrates
our continued focus on generating solid operating and financial
performance while also exploring strategic expansion opportunities to
further grow our business.”
Distribution to IDS Holders
Each quarter, the Board considers the declaration of dividends during
its normally scheduled meeting. For the second quarter of 2008, the
Board is meeting on August 14, 2008. Currently, it is anticipated that
the Company’s dividends will continue to be
treated as a return of capital for tax purposes. The scheduled interest
and any dividend declared will be paid on September 30, 2008 to holders
of record as of the close of business on September 15, 2008. The
interest payment will cover the period from June 30, 2008 through
September 29, 2008.
Second Quarter 2008 Financial Summary |
|||||||||||
(Dollars in thousands, except per share amounts) |
|||||||||||
|
|
|
|||||||||
Three Months Ended June 30, |
Change |
||||||||||
|
2007 |
|
2008 |
|
Amount |
|
Percent |
||||
|
|||||||||||
Revenues |
$ 17,118 |
$ 17,669 |
$ 551 |
3.2 |
% |
||||||
Operating income |
$ 4,389 |
$ 5,006 |
$ 617 |
14.1 |
% |
||||||
Interest expense |
$ (5,412 |
) |
$ (4,773 |
) |
$ (639 |
) |
(11.8 |
)% |
|||
Net income (loss) available to stockholders |
$ (105 |
) |
$ 406 |
$ 511 |
* |
% |
|||||
Basic net income (loss) per share |
$ (0.01 |
) |
$ 0.03 |
$ 0.4 |
* |
% |
|||||
Diluted net income (loss) per share |
$ (0.03 |
) |
$ 0.02 |
$ 0.5 |
* |
% |
|||||
|
|||||||||||
Adjusted EBITDA(a) |
$ 8,349 |
$ 8,479 |
$ 130 |
1.6 |
% |
||||||
Capital expenditures |
$ 1,501 |
$ 1,534 |
$ 33 |
2.2 |
% |
||||||
|
|||||||||||
Six Months Ended June 30, |
Change |
||||||||||
|
YTD 2007 |
|
YTD 2008 |
|
Amount |
|
Percent |
||||
|
|||||||||||
Revenues |
$ 34,291 |
$ 35,528 |
$ 1,237 |
3.6 |
% |
||||||
Operating income |
$ 9,159 |
$ 10,146 |
$ 987 |
10.8 |
% |
||||||
Interest expense |
$ (10,789 |
) |
$ (9,456 |
) |
$ (1,333 |
) |
(12.4 |
)% |
|||
Net income (loss) available to stockholders |
$ (223 |
) |
$ 814 |
$ 1,037 |
* |
% |
|||||
Basic net income (loss) per share |
$ (0.02 |
) |
$ 0.06 |
$ 0.8 |
* |
% |
|||||
Diluted net income (loss) per share |
$ (0.07 |
) |
$ 0.05 |
$ 0.12 |
* |
% |
|||||
|
|||||||||||
Adjusted EBITDA(a) |
$ 17,049 |
$ 17,333 |
$ 284 |
1.7 |
% |
||||||
Capital expenditures |
$ 2,876 |
$ 3,947 |
$ 1,071 |
37.2 |
% |
||||||
|
|||||||||||
* Not a meaningful calculation |
|||||||||||
|
|||||||||||
|
|||||||||||
Reconciliation of Adjusted EBITDA to Net Income (Loss) |
|
||||||||||
|
|||||||||||
Three Months Ended |
Six Months Ended |
||||||||||
June 30, |
June 30, |
||||||||||
2007 |
2008 |
2007 |
2008 |
||||||||
Adjusted EBITDA |
|||||||||||
Net Income (Loss) |
$ (105 |
) |
$ 406 |
$ (223 |
) |
$ 814 |
|||||
Add: Depreciation |
3,127 |
2,772 |
6,107 |
5,528 |
|||||||
Interest Expense – Net of Premium |
4,774 |
4,179 |
9,525 |
8,276 |
|||||||
Interest Expense – Caplet Cost |
240 |
240 |
468 |
470 |
|||||||
Interest Expense – Amortize Loan Cost |
398 |
373 |
796 |
746 |
|||||||
Interest Expense – Premium |
– |
(18 |
) |
– |
(35 |
) |
|||||
Gain/Loss from Investment |
– |
– |
– |
(45 |
) |
||||||
Income Tax Expense |
(503 |
) |
57 |
(491 |
) |
232 |
|||||
Change in Fair Value of Derivative |
(250 |
) |
(167 |
) |
(468 |
) |
74 |
||||
Loan Fees |
19 |
19 |
38 |
38 |
|||||||
Amortization – Intangibles |
649 |
618 |
1,297 |
1,235 |
|||||||
Adjusted EBITDA |
$ 8,349 |
$ 8,479 |
$17,049 |
$ 17,333 |
|||||||
|
|||||||||||
(a) Adjusted EBITDA is defined as consolidated net income (loss) plus interest expense, depreciation and amortization, income taxes and certain non-recurring fees, expenses or charges and other non-cash charges reducing consolidated net income. Adjusted EBITDA is not a measure calculated in accordance with generally acceptable accounting principles (GAAP). While providing useful information, Adjusted EBITDA should not be considered in isolation or as a substitute for consolidated statement of operations data prepared in accordance with GAAP. The Company believes Adjusted EBITDA is useful as a tool to analyze the Company on the basis of operating performance and leverage. The definition of Adjusted EBITDA corresponds to the definition of Adjusted EBITDA in the indenture governing the Company’s senior subordinated notes and its credit facility and certain of the covenants contained therein. The Company’s presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. |
|
Year Ended December 31, |
Major Newsire & Press Release Distribution with Basic Starting at only $19 and Complete OTCBB / Financial Distribution only $89 Get Unlimited Organic Website Traffic to your Website |
|||||