4/25/00
NEXTLINK Announces First Quarter Sets New Records For Installed Lines and Revenue
NEXTLINK posts $105.8 million in 1Q revenue and 93,000+ installed access lines
McLEAN, VA - NEXTLINK Communications, Inc. (NASDAQ:NXLK), one of the nation's fastest growing providers of broadband communications services, today announced financial results for the quarter ended March 31, 2000.
Total revenue grew to $105.8 million in the first quarter of 2000, an 18 percent increase over revenue reported in the fourth quarter of 1999, and a 118 percent increase over revenue reported in the first quarter of 1999. NEXTLINK's core services revenue, consisting of bundled local and long distance, as well as,asas dedicated services, reached $91.8 million in the first quarter of 2000, up 23 percent over the fourth quarter of 1999.
NEXTLINK also reported continued growth in access line installations, adding 93,104 access lines during the first quarter to bring the total installed base to 521,139 on March 31, 2000. These quarterly additions represent an 18 percent increase over net access lines installed in the fourth quarter of 1999, and an 84 percent increase over the 50,531 net access lines added in the first quarter of 1999.
The EBITDA loss (operating loss before depreciation, amortization and deferred compensation expense) totaled $63.1 million in the first quarter of 2000, compared to an EBITDA loss of $47.4 million in the first quarter of 1999. In the first quarter of 2000, NEXTLINK also recorded $225 million of other income reflecting the gain realized on the sale of a strategic equity investment. Taking this gain into account, the company had net income per share of .07 for the quarter. Excluding the impact of this one time sale, the Company’s net loss would have been $1.59 per share.
"We are encouraged that we are meeting our stockholders’ growth expectations while significantly increasing our velocity toward becoming a premiere integrated communications provider of voice and data broadband services," said NEXTLINK Chairman and Chief Executive Officer Dan Akerson. "NEXTLINK has been recognized as a company with unparalleled broadband network assets, particularly at the last mile. And now, this past quarter we have made significant strides in increasing our voice and data product capabilities that make us much more than just a great asset story."
Last week, as part of its launch of new voice and data services that will be available in most NEXTLINK markets, the company announced a private label agreement with Concentric Network Corporation to provide digital subscriber line (DSL) services (IDSL, ADSL and SDSL), dedicated and shared web hosting and e-commerce services. As a part of the product launch, NEXTLINK also announced an Integrated Access Service value bundle that includes local, long distance and Internet services using the same T-1 access facility. The services will be sold by NEXTLINK’s 600+ person direct sales force that is being augmented by more than 60 recently hired data sales specialists. Additionally, a new calling card platform, national long distance plan and conference calling capabilities were introduced.
"We have established a sense of urgency within the NEXTLINK organization to aggressively broaden our voice and data product suite. We now have the first product building blocks in place," continued Akerson. "This product foundation and our intense focus on our back office systems will allow us to introduce new products later this year that fully utilize all of our network assets in a truly differentiated way to our customers."
During 2000 NEXTLINK intends to continue its drive to be a leading facilities-based, IP-centric network provider by executing its metropolitan fiber, DSL and broadband wireless network buildouts. NEXTLINK believes that by owning its own facilities, it is creating a network cost structure that is expected to result in stronger service level agreements with customers and yield higher operating margins while providing NEXTLINK with significant marketing advantages.
Today, the company announced its plans to launch commercial service in Fort Lauderdale and Tampa, Florida; Austin, Texas and Baltimore, Maryland by the end of the third quarter. By the end of the year, NEXTLINK expects to operate robust metro fiber networks in most of the top 30 U.S. markets with more than 410,000 miles of metro fiber already in place today.
NEXTLINK also plans to deploy broadband wireless networks in 25 markets by the end of 2000 as a powerful complement to fiber and DSL services for delivering high bandwidth "last mile" broadband access to business customers. During the first quarter NEXTLINK announced a vendor agreement with Nortel to provide point-to-multipoint broadband wireless equipment and expects to announce additional agreements with manufacturers of broadband wireless equipment in the future.
Also during the first quarter, NEXTLINK and Concentric Network Corporation (NASDAQ:CNCX) agreed to merge the two companies in a transaction that is expected to combine NEXTLINK’s unrivaled network assets with Concentric's strong positions in the business-grade DSL and shared Web hosting markets as well as its e-commerce capabilities in application hosting, managed security, and virtual private networks (VPNs). The transaction, which was valued at approximately $2.9 billion at the time of the announcement, is expected to close in the second quarter of this year.
NEXTLINK provides high quality, broadband communications services to businesses over fiber optic and broadband wireless facilities across the United States. NEXTLINK currently is providing service in 49 markets. The company is the largest holder of broadband fixed wireless spectrum in North America, with licenses in the top 30 markets in the United States. NEXTLINK plans to use wireless capabilities to complement and extend the reach of its local fiber optic networks in the markets in which NEXTLINK has spectrum. Additionally, NEXTLINK is beginning to take delivery of certain fibers and a conduit throughout a 16,000-mile high-speed, IP-centric fiber optic backbone network that will connect over 50 cities in the United States and Canada. The network is expected to be completed in 2001. Through this unrivaled collection of facilities, NEXTLINK will provide integrated, end-to-end telecommunications solutions to its customers. For more information, visit http://www.nextlink.com.
For more information contact:
Todd Wolfenbarger / XO Communications
Media and Industry analysts
703-547-2011 or 703-675-3496
