Electric Lightwave Reports Financial Results for 2001 Fourth Quarter and Year End.Business Editors STAMFORD Stamford, town, England Stamford, town (1991 pop. 18,127), in the Parts of Kesteven, Lincolnshire, E central England, on the Welland River. It is a market town. Products include diesel engines, electrical equipment, bricks, and tiles. , Conn.--(BUSINESS WIRE)--March 7, 2002 Electric Lightwave Light in the infrared, visible and ultraviolet ranges, which falls between x-rays and microwaves. Wavelengths are between 10 nanometers and one millimeter. , Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ELIX E`lix´ v. t. 1. To extract. ) today reported financial results for the fourth quarter and year ended December 31, 2001. The following information should be read in conjunction with our financial statements and footnotes contained in our Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. to be filed with the Securities and Exchange Commission. Revenue for 2001 totaled $226.6 million compared to $244.0 million for 2000, a decrease of 7 percent. Fourth-quarter revenue for 2001 was $50.3 million compared to $63.0 million in the prior year's fourth quarter, a decrease of 20 percent. The net loss for 2001 was $171.7 million or $3.37 per share, compared to a net loss of $136.5 million or $2.71 per share in 2000. Electric Lightwave, Inc. (ELI Eli (ē`lī), in the Bible, high priest and judge of Israel, teacher of the boy Samuel. 1. (language) ELI - An early system on the IBM 705 and IBM 650. [Listed in CACM 2(5):16 (May 1959)]. 2. ) EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become for 2001 was $5.8 million, a $4.0 million increase over $1.8 million EBITDA for 2000. ELI fourth-quarter 2001 EBITDA was $.6 million, a $4.5 million decrease from $5.1 million EBITDA for the 2000 fourth quarter. EBITDA is operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. plus depreciation and amortization. EBITDA is a measure commonly used to analyze companies on the basis of operating performance. EBITDA is not a measure of financial performance nor is it an alternative to cash flow as a measure of liquidity and may not be comparable to similarly titled measures of other companies. ELI's results for the year ended December 31, 2001 were affected by severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when costs of $3.2 million and a restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). related to exiting certain long-haul markets with an associated expense of $4.2 million and lower-than-anticipated revenue primarily due to a downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. in economic conditions that affected Internet service providers Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. and related businesses; a decline in data services due to the expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created of a material contract; and a decrease in reciprocal Bilateral; two-sided; mutual; interchanged. Reciprocal obligations are duties owed by one individual to another and vice versa. A reciprocal contract is one in which the parties enter into mutual agreements. compensation. ELI Class A Common Stock is currently traded on the Nasdaq National Market System, but the stock does not meet minimum bid price and market value of public float requirements for continued listing. If the stock is unable to regain compliance by May 15, 2002, the stock could be subject to delisting Delisting When the stock of a company is removed from a stock exchange. Notes: Reasons for delisting include violating regulations and/or failure to meet financial specifications set out by the stock exchange. at that time. Guidance for 2002 for ELI is reaffirmed at: Revenue of $250.0 million; adjusted EBITDA of $22.0 million; and capital expenditures of $75.0 million, excluding the exercise of the purchase option of $110 million under the synthetic lease Synthetic Lease An operating lease that is structured in a way so that it is not recorded as a liability on the balance sheet. Instead, it is considered to be an expense on the income statement. . About Electric Lightwave, Inc. Electric Lightwave, Inc. is a facilities-based competitive local exchange carrier providing Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the , data, voice and dedicated access services to communications-intensive businesses in the western United States Noun 1. western United States - the region of the United States lying to the west of the Mississippi River West Santa Fe Trail - a trail that extends from Missouri to New Mexico; an important route for settlers moving west in the 19th century . The company is 85 percent owned by Citizens Communications Citizens Communications is the parent company of Frontier Telephone, providing telephone and internet access in 24 states. The company headquarters are located at 3 High Ridge Park in Stamford, Connecticut. (NYSE NYSE See: New York Stock Exchange : CZN, CZB). More information about Electric Lightwave, Inc. may be found at www.eli.net. This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the statements. All forward-looking statements are only predictions or statements of current plans, which are constantly under review by Electric Lightwave (the company). All forward-looking statements may differ from actual future results due to, but not limited to, changes in the local and overall economy, the nature and pace of technological changes, the number and effectiveness of competitors in the company's markets, success in overall strategy, changes in legal and regulatory policy, relations with Incumbent Local Exchange Carriers ILEC, short for incumbent local exchange carrier, is a local telephone company in the United States that was in existence at the time of the break up of AT&T into the Regional Bell Operating Companies (RBOCs) also known as the "Baby Bells". (ILECs) and their ability to provide delivery of services including interoffice in·ter·of·fice adj. Transmitted or taking place between offices, especially those of a single organization: an interoffice memo; interoffice conferences. trunking See port aggregation. , implementation of back office service delivery systems, the company's ability to identify future markets and successfully expand existing ones and the mix of products and services offered in the company's target markets. Readers should consider these important factors in evaluating any statement contained herein and/or made by the company or on its behalf. The company has no obligation to update or revise forward-looking statements to reflect the occurrence of future events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . (Compare to the list in the present draft of the 10-K, which is somewhat different.)
Electric Lightwave, Inc.
Statements of Operations
(In thousands, except per share amounts)
Three Months Ended
12/31/2001 09/30/2001 12/31/2000
------------ ------------ ------------
Revenue:
Network Services $ 23,372 $ 26,077 $ 22,633
Local Telephone Services 15,177 14,450 23,231
Long Distance Services 2,980 3,131 3,728
Data Services 8,790 9,672 13,377
----------- ------------- -------------
Total Revenues 50,319 53,330 62,969
----------- ------------- -------------
Operating Expenses:
Network Access 20,775 17,232 17,294
Operations 10,778 14,442 14,245
Selling, General and
Administrative 18,109 22,361 26,263
Severance expense 62 1,418 54
Depreciation and
Amortization 20,375 19,919 17,882
----------- ------------- -------------
Total Operating
Expenses 70,099 75,372 75,738
----------- ------------- -------------
Loss from Operations (19,780) (22,042) (12,769)
Interest Expense and Other 25,943 25,231 21,544
----------- ------------- -------------
Net Loss Before Income
Taxes (45,723) (47,273) (34,313)
Income Tax Expense 705 22 (540)
----------- ------------- -------------
Net Loss $ (46,428) $ (47,295) $ (33,773)
=========== ============= =============
EBITDA $ 595 $ (2,123) $ 5,113
=========== ============= =============
Weighted average shares
outstanding 51,103 51,107 50,494
Net Loss Per Common Share:
Basic $ (0.91) $ (0.93) $ (0.67)
Diluted $ (0.91) $ (0.93) $ (0.67)
Electric Lightwave, Inc.
Statements of Operations
(In thousands, except per share amounts)
Twelve Months Ended
12/31/2001 12/31/2000
------------ ------------
Revenue:
Network Services $ 101,338 $ 77,437
Local Telephone Services 73,291 98,643
Long Distance Services 12,294 16,318
Data Services 39,717 51,579
-------------- -------------
Total Revenues 226,640 243,977
-------------- -------------
Operating Expenses:
Network Access 71,789 74,105
Operations 51,598 52,740
Selling, General and Administrative 94,221 115,139
Severance expense 3,203 206
Depreciation and Amortization 79,022 61,663
-------------- -------------
Total Operating Expenses 299,833 303,853
-------------- -------------
Loss from Operations (73,193) (59,876)
Interest Expense and Other 97,345 76,186
-------------- -------------
Net Loss Before Income Taxes (170,538) (136,062)
Income Tax Expense 1,154 400
-------------- -------------
Net Loss $ (171,692) $ (136,462)
============== =============
EBITDA $ 5,829 $ 1,787
============== =============
Weighted average shares outstanding 50,978 50,274
Net Loss Per Common Share:
Basic $ (3.37) $ (2.71)
Diluted $ (3.37) $ (2.71)
Electric Lightwave, Inc.
Selected Financial & Operating Data
(In thousands, except selected operating data)
12/31/2001 09/30/2001 12/31/2000
------------ ------------ ------------
Selected Financial Data
Gross Property Plant &
Equipment
Owned or under
capital lease $ 1,037,349 $ 1,029,724 $ 978,327
Under operating
lease (1) $ 108,541 $ 108,541 $ 108,541
------------ ------------- ------------
Total $ 1,145,890 $ 1,138,265 $ 1,086,868
Selected Operating Data
Markets 25 25 25
Route Miles (2) 6,754 6,737 5,924
Fiber Miles (2) 354,083 353,785 297,284
Buildings Connected On-Net 859 860 851
Switches and Routers:
Internet Routers 80 79 65
ATM Switches 23 23 23
Frame Relay
Switches 33 32 32
Voice Switches 8 8 8
Access Line Equivalents 148,787 172,372 200,231
Access Line Equivalents/
Voice Switch 18,598 21,547 25,029
% on Switch 98% 99% 96%
Employees 823 928 1,161
Customers 2,243 2,245 2,246
(1) Facilities under an operating lease agreement under which we have
the option to purchase the facilities at the end of the lease
term.
(2) Route and Fiber miles also include those to which we have
exclusive use pursuant to license and lease arrangements.
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