Jazztel plc Announces First Quarter 2000 Results.Business Editors MADRID Madrid (mədrĭd`, Span. mäthhrēth`), city (1990 pop. 3,120,732), capital of Spain and of Madrid prov., central Spain, and the focus of its own autonomous region, on the Manzanares River. , Spain--(BUSINESS WIRE)--May 17, 2000 Jazztel p.l.c., (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 ; EASDAQ See European Association of Securities Dealers Automated Quotation. : JAZZ) a facilities-based telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. and 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 services provider that is constructing a fiber-optic See fiber optics. telecommunications network A telecommunications network is a of telecommunications links and nodes arranged so that messages may be passed from one part of the network to another over multiple links and through various nodes. to be the first nationwide competitive local exchange carrier (CLEC (Competitive Local Exchange Carrier) An organization offering local telephone service that is not one of the traditional telephone companies. The Telecommunications Act of 1996 allowed competition to the incumbent telcos (ILECs), enabling new companies (CLECs) ) in Spain Spain, Span. España (āspä`nyä), officially Kingdom of Spain, constitutional monarchy (2005 est. pop. 40,341,000), 194,884 sq mi (504,750 sq km), including the Balearic and Canary islands, SW Europe. and Portugal Portugal (pôr`chəgəl), officially Portuguese Republic, republic (2005 est. pop. 10,566,000), 35,553 sq mi (92,082 sq km), SW Europe, on the western side of the Iberian Peninsula and including the Madeira Islands and the Azores in the , today announced results for the first quarter ended March 31, 2000. Amounts are presented in Euros and in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with US GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . Highlights of the Quarter - Quarterly revenue growth of 80% compared to the fourth quarter 1999. - Gross margin break-even in the Group's Spanish Spanish, river, c.150 mi (240 km) long, issuing from Spanish Lake, S Ont., Canada, NW of Sudbury, and flowing generally S through Biskotasi and Agnew lakes to Lake Huron opposite Manitoulin island. There are several hydroelectric stations on the river. operations. - 580 km of local access networks built including additional operational fiber rings in Valencia Valencia, region, Spain Valencia (välān`thēä), autonomous region (1990 pop. 3,902,429) and former kingdom, E Spain, on the Mediterranean. It now comprises the provinces of Alicante, Castellón, and Valencia. and Madrid, adding to the Alcobendas Introduction Alcobendas is a city located in the Community of Madrid (Spain). It is located roughly 13 km north of Madrid and 7 km from the Barajas international airport of Madrid. ring. - Launch of direct access sales in Spain with 110 contracts signed for direct access service provisioning as of the end of the quarter. - Launch of indirect access and corporate ISP (1) See in-system programmable. (2) (Internet Service Provider) An organization that provides access to the Internet. Connection to the user is provided via dial-up, ISDN, cable, DSL and T1/T3 lines. services in Portugal. - Broadband wireless See wireless broadband. local loop license granted in Spain to Banda Banda may refer to: People
- Acquisition by YIF YIF Your Imaginary Friend of Inforespana, the leading Spanish chat technology and services provider, and Forum M, now Terravista, a Portuguese multimedia company which will manage the Internet expansion of the Group in Portugal. - Appointment of three top level executives to reinforce the Group's management team in Spain. - Appointment of Moises Israel Israel, in the Bible Israel (ĭz`rēəl, ĭz`rāəl) [as understood by Hebrews,=he strives with God], according to the book of Genesis, name given to Jacob as eponymous ancestor of the Hebrews, the chosen people of God. as Chief Executive Officer of the Group's Internet content subsidiary, Yacom Internet Factory (YIF). - Launch of Comversa.com, a majority owned subsidiary of the Jazztel Group, to provide advanced web based Coming from a Web server. See Web application. audio and videoconference vid·e·o·con·fer·ence n. A teleconference using video technology, such as closed-circuit television. vid services. Financing Strategy Developments - The Jazztel Group has reiterated its intentions to pursue a Madrid Stock Exchange Madrid Stock Exchange (Bolsa de Madrid) The largest of Spain's four stock exchanges. listing following the regulatory developments resulting in the creation of the Nuevo Mercado For the hispanic surname "Mercado", please see de Mercado. Mercado first originated in Spain. In English it means 'market'. Is the last name of the 'Great' Fifa Soccer player Eswold. for high growth companies. - The Jazztel Group has filed the Comunicacion Previa or formal notification to the CNMV CNMV Comisión Nacional del Mercado de Valores CNMV Colegiul National Mihai Viteazul (Romania) , the Spanish securities and exchange regulatory body, registering its intention to float Yacom Internet Factory, its Internet subsidiary, raising primary equity in the process. - The Jazztel Group has received assurances from its original private equity investors, holding approximately 20 million shares in Jazztel, that they do not intend to sell shares upon 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 the lock-up lock-up n (= prison) → cárcel f (= cell); jaula; (also: lock-up garage) → jaula, cochera lock-up period on June June: see month. 6 entered into at the time of the IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. . - Jazztel intends to call for a shareholder meeting in order to receive authorization The right or permission to use a system resource; the process of granting access. See access control. to raise additional capital. This will give Jazztel the flexibility to access the equity market when and if appropriate.
Operational Statistics
----------------------------------------------------------------------
Euro Million 4th Quarter 1999 1st Quarter 2000 % Growth
----------------------------------------------------------------------
Group Revenues 12.9 23.2 79.8%
----------------------------------------------------------------------
Gross Margin (a) (2.5) (1.96) 21.0%
----------------------------------------------------------------------
% of sales -19.3% -8.5%
----------------------------------------------------------------------
EBITDA (b) (45.5) (44.9)(c) 1.4%
----------------------------------------------------------------------
% of sales -352% -189%
----------------------------------------------------------------------
Capex 49.0 69.7(d) 42.2%
----------------------------------------------------------------------
(a) (b) Gross margin does not include customer acquisition costs
starting first quarter 2000 due to change in reporting policy. These
customer acquisition costs are now included in SG&A costs in line with
market practice.
(c) Includes Euro 7.3 million from YIF and Euro 2.7 million for
non-cash accounting charges related to employee compensation.
(d) Includes Euro 17 million of cash outflow from acquisitions.
------------------------------------------------------------------------
4th Quarter 1999 1st Quarter 2000 % Growth
------------------------------------------------------------------------
Network Deployment
------------------------------------------------------------------------
Local access km completed 350 580 65.7%
------------------------------------------------------------------------
Backbone km completed 4,220 4,220 0%
------------------------------------------------------------------------
Direct Access
------------------------------------------------------------------------
Direct sales force 35 80 128.6%
------------------------------------------------------------------------
Contracts Signed 28 110 292.9%
------------------------------------------------------------------------
Buildings connected n.a 30 n.a
------------------------------------------------------------------------
Indirect Access
------------------------------------------------------------------------
Number of customers 283,800 487,300 71.7%
------------------------------------------------------------------------
Number of lines 507,500 802,900 58.2%
------------------------------------------------------------------------
Corporate ISP
------------------------------------------------------------------------
Active Jazznet customers n.a. 7,400 n.a
------------------------------------------------------------------------
ADSL customers n.a 52 n.a
------------------------------------------------------------------------
Hosted Virtual ISPs 7 13 85.7%
------------------------------------------------------------------------
Carrier's Carrier
------------------------------------------------------------------------
Traffic Termination
contracts 4 12 200%
------------------------------------------------------------------------
Wholesale capacity
contracts n.a 6 n.a
------------------------------------------------------------------------
Internet
------------------------------------------------------------------------
Jazzfree customers 165,600 253,250 52.9%
------------------------------------------------------------------------
Page views (millions) 78.5 143.6 82.9%
------------------------------------------------------------------------
Minutes of Traffic (millions) 149 284 90.6%
------------------------------------------------------------------------
Headcount 281 616 119.2%
------------------------------------------------------------------------
Summary of Operations The Jazztel Group had total revenues of Euro 23.2 million for the first quarter 2000, up from Euro 12.9 million for the last quarter of 1999, representing a growth of 80%. The Group also has substantially improved its gross margins, with a loss of Euro 1.96 million for the first quarter, improving from a loss of Euro 2.5 million. Gross margin as percentage of sales therefore improved from a negative 19.3% to a negative 8.5%. 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 losses for the first quarter have decreased modestly to Euro 44.9 million, compared to Euro 45.5 million for the fourth quarter 1999. Commenting on the results, Antonio Antonio lends money gratis. [Br. Lit.: Merchant of Venice] See : Generosity Antonio schemes against his brother Prospero. [Br. Lit.: The Tempest] See : Treachery Carro, Jazztel's CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. said: "During the first quarter we have seen strong top line growth together with very significant improvements in our EBITDA margins. Our Spanish telecommunications operations have reached gross margin break-even, with a clear trend towards profitability. We are very pleased with the results of the launch of our direct access sales effort in Spain, the successful launch of our Portuguese operations and the strong development of our Internet business. Our local access network is on track and we have started to connect customers directly. The recent grant of a broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). fixed wireless local loop access license in Spain represents a key contribution to our Iberian Iberian Any member of a prehistoric people of southern and eastern Spain. They were largely untouched by the migrations of Celtic peoples to northern and central Spain beginning in the 8th century BC. Culturally they were influenced by Greek and Phoenician trading colonies. strategy and will accelerate the consolidation of Jazztel's position as a leading provider of bandwidth and Internet services in Iberia Iberia (ībĭr`ēə), ancient country of Transcaucasia, roughly the eastern part of present-day Georgia. It was inhabited in earliest times by various tribes, collectively called Iberians by ancient historians, although Herodotus called ." "We have substantially reinforced our management team, hiring three new top level executives as Managing Directors for our Spanish operations: Javier Javier (also Xabier) may refer to:
Mexican writer known for his metaphysical short stories and novels about his homeland, notably The Death of Artemio Cruz (1962). Noun 1. , who is in charge of all budgetary and controlling initiatives and Carlos Carlos, prince of the Asturias Carlos, 1545–68, prince of the Asturias, son of Philip II of Spain and Maria of Portugal. Don Carlos, who seems to have been mentally unbalanced and subject to fits of homicidal mania, was imprisoned by his father in Morell Morell is a surname, and may refer to:
First quarter operational achievements Network Deployment As of March 31, 2000 Jazztel had constructed 580 local access km and 4,220 km of backbone network A backbone network provides a path for the exchange of information between different LANs or subnetworks.[1] A backbone can tie together diverse networks in the same building, in different buildings in a campus environment, or over wide areas. . Commenting on the evolution of network deployment, Antonio Carro said: "Following the completion, well ahead of schedule, of the first phase of our backbone network deployment, our network construction activity during this quarter has focused on the acceleration of the deployment of our local access infrastructure. Construction is on track with 580 km of local access ducts already built, and we have devoted significant efforts to increase the number of building permits and licenses granted. As a result of this effort we have now permits for 500 additional km, most of which are currently under construction. We have also submitted building permit applications for over 1,400 additional km. We therefore feel very confident that we will meet our year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. construction targets."
-----------------------------------------------------------------------
4th Quarter 1999 1st Quarter 2000 Growth
-----------------------------------------------------------------------
Km completed 350 580 65.7%
-----------------------------------------------------------------------
Additional km with building
permits or which are
under construction 360 500 38.9%
-----------------------------------------------------------------------
Additional km with application
for permits submitted 185 1,450 683.8%
-----------------------------------------------------------------------
Direct Access During the first quarter of 2000 Jazztel effectively launched its direct access strategy and by the end of the quarter the Group has signed a total of 110 contracts to provide over 14,400 Voice Grade Equivalents (VGEs). Antonio Carro commented on these developments: "We are pleased with the initial results of our commercial activity; customer response to our service offering has been very encouraging and the prospects of the business are highly positive. We are expanding our sales force to enhance the reach of our commercial activity. We have managed to recruit 80 very talented people and we are well on track to reach our target of 100 people by the end of the first half of the year." Indirect Access Indirect voice revenues continued to grow rapidly during last quarter, reaching Euro 17.3 million versus Euro 12.0 million for the fourth quarter of 1999, representing a growth of 44.7%. Strong customer and indirect access line take-up was the major driver behind this growth, as the Jazztel Group closed the quarter with 487,300 indirect access customers and 802,900 lines in service, a 71.7% and a 58.2% growth rate, respectively, compared with the previous quarter. Of the indirect access lines, 62% corresponded to business customers. Antonio Carro commented on the Group's indirect access strategy: "We intend to continue to grow our customer base while minimizing acquisition costs per customer. We have managed to significantly reduce sales commissions and marketing expenditures by more than 11%, while maintaining strong customer take-up rates. We are now aiming to increase customer loyalty and usage levels per line through the introduction of carrier pre-selection Carrier Pre-Selection (CPS) is a method of routing calls for Least Cost Routing (LCR) without the need for programming of PBX telephone system. See also
Carrier's Carrier The wholesale business of the Jazztel Group has seen very important developments during the quarter. During the first quarter of the year, Jazztel has provided international traffic termination and international transit services to 12 international carriers, which have generated total revenues of Euro 4.1 million. Part of this growth has been driven by short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. arbitrage arbitrage: see foreign exchange. arbitrage Business operation involving the purchase of foreign currency, gold, financial securities, or commodities in one market and their almost simultaneous sale in another market, in order to profit from price opportunities from international transit, which may or may not recur in the following quarters. However, as the Group deploys its network infrastructure in Spain and Portugal, the focus will shift towards wholesale capacity contracts. The Group has already signed six of these contracts to begin the provisioning of managed bandwidth, collocation collocation - co-location services and metropolitan connectivity to international carriers. Corporate ISP The Jazztel Group has sustained strong growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. in its ISP business, ending the first quarter with a total of 7,400 active Jazznet access customers. Jazztel offered wholesale or virtual ISP An ISP that uses the facilities and services (servers, switches, backbone, etc.) of a large ISP, but retains its own branding for marketing and billing purposes. Virtual ISPs are often formed to target a specific group, whether by location, profession, language or other subject of common services to 13 ISPs by the end of the quarter, up from 7 at the end of 1999. These services include all stages of the ISP value chain: dial-up access hot Dial-up access is a form of Internet access via telephone line. The client uses a modem connected to a computer and a telephone line to dial into an Internet service provider's (ISP) node to establish a modem-to-modem link, which is then routed to the Internet. services, IP services, e-mail services See Internet e-mail service. , facilities rental, web hosting Making a Web site available on the Internet. Many ISPs host a few personal Web pages for an individual at no additional cost above the monthly service fee, but the address is subordinate to the ISP; for example, www.friendlyisp.com/pat_smith. , subscriber authentication (1) Verifying the integrity of a transmitted message. See message integrity, e-mail authentication and MAC. (2) Verifying the identity of a user logging into a network. and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. wholesale Internet access See how to access the Internet. . The company has a data center in both Madrid and Barcelona Barcelona (bär'səlō`nə, Catalan bär'səlō`nə, Span. bär'thālō`nä), city (1990 pop. 4,738,354), capital of Barcelona prov. and chief city of Catalonia, NE Spain, on the Mediterranean Sea. and is also opening one in Lisbon, consistent with its plans to focus aggressively on expanding its web hosting and ASP capabilities, both internally and through acquisitions. Other Services The Jazztel Group has continued to increase its service offering in the Iberian market with the launch of Comversa.com, a majority owned subsidiary of the Group that intends to become a leading provider of advanced web based audio and video conference services to SMEs in Iberia. The Comversa.com service offering will be bundled with the Group's direct access voice and data services to improve the value proposition offered to Jazztel's direct customers. Yacom Internet Factory On May 5, 2000, Jazztel Internet Factory changed its name to Yacom Internet Factory (YIF). On January 15 the Company acquired Inforespana, a leading chat technology and services provider, and on January 31 acquired Forum M, a Portuguese multimedia company which will manage the Internet expansion of YIF in Portugal. Our Portuguese horizontal portal offering, named terravista.pt, was re-launched on March 23, 2000, and has three vertical sites associated with it: bolsa-invest.com (finance), musicnet.pt (music) and digital-forum.pt (Information Technology). The number of free Mixmail webmail accounts as of March 31, 2000 was up to 1.3 million from 0.9 million at the end of 1999. Page views in the first quarter of 2000 increased by 83% from the previous quarter to 143.6 million. On April 1, Jazzfree, our free ISP See free Internet service. targeted at the residential market, was transferred to YIF. The business continues to perform strongly with Jazzfree subscribers having increased from 165,600 in the fourth quarter 1999 to a total of 253,250 at the end of first quarter of 2000, a 52.9% increase. Total minutes carried by Jazzfree ISP in the first quarter of the year increased 55% to 104 million compared to 67 million for the fourth quarter 1999. The YIF group has grown to 178 employees as of March 31, 2000 up from 75 as of December 31, 1999 in Spain and Portugal. The company has continued its aggressive branding and image campaigns and is currently preparing the launch of two additional vertical sites during the second quarter of 2000: finanzas.com and supermotor.com. Wireless Local Loop On March 8, 2000, Banda26, S.A., a majority owned subsidiary of the Jazztel Group, was awarded by the Spanish Government
Used to describe a proportionate allocation. Notes: For example, a pro-rata dividend means that every shareholder gets an equal proportion for each share they own. See also: Dividend by Jazztel, Teligent and Abengoa , and the companies have initially agreed to explore all available possibilities to leverage their equity contributions. Commenting on the wireless fixed local loop license, Antonio Carro commented: "Banda26 will enable our Spanish operations to accelerate their pace of footprint The amount of geographic space covered by an object. A computer footprint is the desk or floor surface it occupies. A satellite's footprint is the earth area covered by its downlink. See form factor. 1. expansion, leveraging on our backbone and local access network infrastructure to increase and enhance our ability to directly connect our target customers." Financial Information Miguel Salis, Chief Financial Officer of Jazztel, commented on the first quarter results: "During the first quarter of the year we have started to see the results of the efforts in our direct access and carrier's carrier operations in Spain and indirect access operations in Portugal. Our revenues have grown 80% compared to the previous quarter, surpassing our revenue projections for the quarter. Margins are also improving as a result of the more favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. revenue mix and the leveraging of our fiber backbone network. We will continue to work hard to aggressively move into business lines with high margins such as direct access, ISP and ASP services and wholesale capacity services." "During this quarter we have made substantial progress to clearly define our budgetary and financial control processes. To lead these initiatives we have hired Antonio Fuentes as Managing Director and Group Controller. Antonio Fuentes has significant experience in these areas. He will be providing Jazztel with the key expertise to ensure that all investments we make are geared towards maximizing shareholder value creation." Mr. Salis concluded. Total Revenues for the quarter ended March 31, 2000 increased to Euro 23.2 million from approximately Euro 12.9 million for the fourth quarter of 1999. These revenues comprise Euro 21.5 million telecom revenues and Euro 1.7 million from Internet operations, encompassing access, e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. and advertising revenues. The increase is primarily a result of substantial increases in the numbers of indirect access customers and lines in service in Spain, the growth in carrier's carrier minutes, the increase in ISP subscribers and the launch of direct access in Spain and indirect access in Portugal. Cost of Sales were Euro 25.2 million for the quarter ended March 31, 2000, compared to Euro 15.4 million for the fourth quarter of 1999 or an increase of 63.4%. Gross margin improved from a negative 19.3% in the fourth quarter of 1999 to 8.5% at the end of the first quarter of 2000. Gross margin for the Spanish operations were positive 4.1%. This improvement was due to the increasing scale of our operations, the favorable evolution of the Group's revenue mix towards business lines with higher contribution margins (direct access and Internet) and also to the lower growth of network operating costs operating costs npl → gastos mpl operacionales , as long distance leased lines A private communications channel leased from a common carrier. Most digital lines require four wires (two pairs) for full-duplex transmission. (communications, networking) leased line from other carriers are gradually replaced by the Group's own backbone infrastructure. This has been achieved despite the fact that we launched our Portuguese operations during the quarter. Selling, General and Administrative expenses for the first quarter of 2000 decreased 0.2% to Euro 42.9 million compared with Euro 43.0 million for the fourth quarter of 1999. This reduction reflects the efforts of the Jazztel Group to minimize indirect access acquisition cost per customer with marketing and selling commissions costs decreasing by more than 11%. EBITDA losses for the first quarter of 2000 were Euro 44.9 million, compared with negative Euro 45.5 million for the fourth quarter of 1999, or a reduction in EBITDA losses of 1.3%, reflecting the improvements on gross margins and the tight control over Selling, General and Administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. . Of the total EBITDA losses, Euro 7.3 million are attributable to Yacom Internet Factory, the Group's Internet content subsidiary, and Euro 2.7 million are attributable to certain non-cash accounting charges related to the granting of stock options at both Jazztel and YIF. Depreciation and Amortization Expense was Euro 6.0 million for the first quarter of 2000, an increase from Euro 3.8 million for the last quarter of 1999. The growth is principally due to increased capital expenditures for the continuing construction of the network in Spain. Net Financial Expense for the quarter was Euro 24.1 million and consisted primarily of accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. on our high yield notes issued in April 1999 and December 1999, less interest earned on invested funds. Net Loss for the first quarter of 2000 was Euro 72.8 million and compared with a net loss of Euro 62.2 million for the fourth quarter of 1999. During the next several years the Jazztel Group expects to continue to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. significant net losses and negative cash flows while completing the deployment of its network, initiating a significantly expanded range of telecommunication telecommunication Communication between parties at a distance from one another. Modern telecommunication systems—capable of transmitting telephone, fax, data, radio, or television signals—can transmit large volumes of information over long distances. services as well as developing its Internet business and its wireless fixed local loop business through Banda26. The Group does not anticipate having positive EBITDA from its telecommunications business in Spain and Portugal until at least 2002. The Group's ability to generate positive EBITDA is subject to numerous risks and uncertainties, many of which are out of its control. This does not take into account the impact of our Internet business or the activities of Banda26. Financial Needs and Resources For the first quarter of 2000, total net cash outflows from operations were Euro 22.9 million. Net cash outflows from capital expenditures, financial investments and acquisitions and disposals were Euro 69.7 million for the quarter, including Euro 20.5 million of capex related to YIF operations, mainly due to acquisitions. The available cash position by the end of the first quarter was approximately Euro 320 million. "With our current cash position, we have sufficient resources to fund our business into the fourth quarter of this year.. In order to fund our telecom operations and our equity contribution to Banda26 through the end of 2001, we currently expect to need to raise approximately Euro 400 million without drawing on the Euro 300 million bank facility we currently have in place. We will continue to monitor market conditions and we plan on accessing the capital markets, when appropriate, to raise additional necessary capital", commented Miguel Salis. "We continue to work on the IPO of our Internet subsidiary, Yacom Internet Factory. Given the different nature of the CLEC and the Internet businesses, we firmly believe in the need to finance both operations independently." added Mr. Salis. "Following the recent creation of a new market for high growth companies in the Madrid Stock Exchange, we will be seeking a Madrid listing. We are also very pleased to announce that we have received assurances from our original private equity investors that they are committed to Jazztel and do not intend to sell shares upon the expiration of their lock ups." Mr. Salis concluded. Certain statements in this release are 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 material risks and uncertainties. Actual results could differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with its businesses, which include among others, competitive developments, risks associated with the Company's growth, the development of the Company's markets, regulatory risks, dependence on its major customers and their spending patterns and other risks which will be presented in the Company's filings with the US Securities and Exchange Commission, including its annual report on form 20-F, and certain European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities
JAZZTEL p.l.c. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Euros)
December 31, March 31,
1999 2000
ASSETS
Current assets:
Cash and cash equivalents 417,063,817 319,116,875
Restricted funds related to Senior Notes 73,861,333 85,379,609
Accounts receivable 10,140,966 24,397,854
Prepaid expenses 6,061,092 8,110,952
Other current assets 29,240,061 42,679,105
Total current assets 536,367,269 479,684,395
----------- -----------
Property and equipment, net 171,678,114 203,508,605
License costs, net 1,530,557 2,615,255
Intangible assets, net 25,377,179 56,125,121
Deferred costs, net 29,591,355 30,705,582
Goodwill, net - -
Restricted funds related to Senior Notes 144,871,063 136,608,989
Deposits and other assets 1,328,161 1,384,457
----------- -----------
TOTAL ASSETS 910,743,698 910,632,404
=========== ===========
LIABILITIES AND SHAREHOLDERS'
EQUITY (DEFICIT)
Current liabilities:
Current maturities of long-term debt 11,719,525 32,451,097
Accrued interest 1,009,699 678,125
Accounts payable 89,415,814 126,919,434
Accrued expenses and other
current liabilities 3,186,947 15,322,371
Total current liabilities 105,331,985 175,371,027
----------- -----------
Long-term debt 664,396,964 669,829,485
Other Long - Term liabilities 2,093 2,095
Minority interests (1,474,446) (3,188,663)
Shareholders' equity (deficit):
Common stock, Euro 0.08 par value,
15,190,356 authorized, issued and
outstanding shares at Dec. 31, 1998
and Euro 0.08 par value 62,500,500
authorized shares and 53,545,712
shares issued and outstanding at
Dec. 31, 1999 4,283,657 4,293,639
Non-voting stock, 0,01 pound sterling
(Euro 0.015) par value at Dec. 31,
1998 and 1999 5,000,000 shares
authorized, issued and outstanding 75,127 75,127
Additional paid in capital 305,591,643 304,602,934
Warrants 2,868,630 2,782,390
Accumulated deficit (170,331,955) (243,135,630)
Total shareholders'
equity (deficit) 142,487,102 68,618,460
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY (DEFICIT) 910,743,698 910,632,404
=========== ===========
-0-
JAZZTEL p.l.c. AND SUBSIDIARIES
STATEMENTS OF OPERATIONS
(In Euros)
CONSOLIDATED
CONSOLIDATED CONSOLIDATED EX-YIF
4Th Quarter 1st Quarter 1st Quarter
1999 2000 2000
OPERATING REVENUES:
Telecommunications revenues 12,519,155 22,367,250 22,367,250
Other revenues 394,047 825,254 -
----------- ----------- ----------
Total operating revenues 12,913,202 23,192,504 22,367,250
------------ ------------ ----------
OPERATING EXPENSES:
Cost of sales (15,406,520) (25,157,248) (23,107,433)
Sales, general and
administration (43,032,005) (42,946,340) (35,601,143)
(inclusive
of 50,287,992 in
compensation expense in
1999 related to share
options issuance)
Depreciation and amortization (3,804,625) (6,028,183) (4,689,751)
Total operating expenses (62,243,150) (74,131,771) (63,398,327)
----------- ----------- ----------
OPERATING LOSS (49,329,948) (50,939,267) (41,031,077)
------------ ------------ ----------
Other income (expense), net:
Interest income 2,670,862 7,028,679 7,028,679
Interest expense (16,987,770) (31,080,433) (31,080,433)
Other expense (672) - -
Total other income
(expense), net (14,317,580) (24,051,755) (24,051,755)
LOSS BEFORE MINORITY
INTERESTS (63,647,528) (74,991,022) (65,082,832)
Minority interests 1,494,445 2,187,347 13.683
----------- ----------- ----------
NET LOSS (62,153,083) (72,803,675) (65,069,149)
=========== =========== ==========
-0-
JAZZTEL p.l.c. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Euros)
Year End 1st Quarter
1999 2000
------------ ----------
OPERATING ACTIVITIES:
Net loss (163,961,093) (72,803,675)
Adjustments to reconcile net loss to net
cash (used in) provided by operating
activities:
Minority interests (1,494,445) (2,187,347)
Amortization of goodwill 224,227 -
Amortization of deferred costs 313,503 -
Other depreciation and amortization 5,344,512 6,028,183
License costs written off - -
Provisions for losses 3,774,435 5,521,166
Non-cash compensation associated with
issuance of share options and shares in
Subsidiary to employees 50,287,992 2,439,878
Changes in operating assets and liabilities:
Accounts receivable (12,705,703) (15,452,922)
Prepaid expenses and other current assets (35,293,141) (15,488,904)
Deposits and other assets (1,268,730) (56,296)
Accounts payable and accruals 89,636,381 49,639,044
Accrued interest 8,239,837 20,399,998
------------ ----------
Net cash used in operating activities (56,902,225) (21,960,875)
------------ ----------
INVESTING ACTIVITIES:
Acquisitions of licenses costs (1,514,378) (1,096,352)
Purchase of property and equipment (113,422,304) (35,797,268)
Acquisitions, net of cash acquired (31,357) -
Acquisitions of intangible assets (26,605,108) (32,797,694)
------------ ----------
Net cash used in investing activities (141,573,147) (69,691,313)
------------ ----------
FINANCING ACTIVITIES:
Funds held in Escrow (218,732,396) (3,256,202)
Deferred costs (29,591,355) (1,114,227)
Proceeds from exercise of share options and
Warrants 13,421,638 -
Issuance of share capital 260,544,938 (3,504,845)
Share issuance costs (12,725,866) -
Increase in short-term debt, net - -
Borrowings of long-term debt 603,122,625 1,580,521
Payments of long-term debt (991,805) -
------------ ----------
Net cash provided by
financing activities 615,047,779 (6,294,753)
-------------- ----------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 416,572,407 (97,946,941)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 491,410 417,063,817
CASH AND CASH EQUIVALENTS AT END
OF PERIOD 417,063,817 319,116,875
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