PrimaCom Reports 2001 First Quarter Results.Business Editors MAINZ Mainz (mīnts), city (1994 pop. 185,487), capital of Rhineland-Palatinate, W Germany, a port on the E bank of the Rhine River opposite the mouth of the Main River. Its French name, also sometimes used in English, is Mayence. , Germany--(BUSINESS WIRE)--May 31, 2001 PrimaCom AG (Neuer Markt Frankfurt, "PRC"/ID No. 625910; Nasdaq: PCAG PCAG Performance Confidence Assessment Group ) today reported its results for the first quarter ended March 31, 2001. PrimaCom and Subsidiaries First Quarter 2001 As Reported The Company's first quarter results reflect the inclusion of the Multikabel acquisition as of October October: see month. 1, 2000. Revenues for the 2001 first quarter were E38.9 million, a 43.6% increase over revenues of E27.1 million in the first quarter of 2000. The increased revenues primarily reflect the contributions of the acquisition of Multikabel in the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. and acquisitions in Germany subsequent to the first quarter of 2000, rate increases for basic analog cable television services, and the continued growth of high-speed Internet See broadband. access and digital television services in Germany and the Netherlands. For the first quarter of 2001, Adjusted 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 (earnings before extraordinary items, discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , minority interests, net interest expense, taxes, depreciation, amortization, non-cash compensation expense and non-operating expenses less non-operating income) amounted to E17.2 million compared with E12.6 million in the year ago period, primarily as the result of the Multikabel and German acquisitions. The net loss for the period was E27.7 million, or E1.40 per basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, versus a net loss of E7.6 million, or E0.38 per basic and diluted share, a year ago. The net loss for the quarter includes E26.6 million of depreciation and amortization, the cumulative effect of the change in accounting principle of E1.0 million, and the non cash compensation expense related to the stock-option plans of the Company of E843,000. Analog Cable Television In the first quarter of 2001, Analog CATV (Community Antenna TV) The original name for cable TV. It used a single antenna at the highest location in the community in order to deliver a quality signal to homes in areas with hilly terrain or other interference. subscribers reached 1,304,881, an increase of approximately 41% over analog CATV subscribers of 925,768 in the first quarter last year. The purchase of Multikabel and acquisitions in Germany accounted for most of the growth. Revenue from analog cable television was E36.2 million, an increase of 35.4% from revenues of E26.7 million in the first quarter of 2000. The acquired cable television subscribers and rate increases accounted for the growth. 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). Products and Services As of March 31, 2001, PrimaCom had approximately 418,000 fully upgraded and ready for service homes, compared with 44,000 at the same time a year ago. At the end of the 2001 first quarter, total high speed 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 subscribers reached 24,442, a 19.3% growth rate over the fourth quarter of 2000. The following table reflects high speed Internet access See how to access the Internet. growth and penetration levels:
1st 2nd 3rd 4th 1st
Quarter Quarter Quarter Quarter Quarter
2000a 2000b 2000c 2000c 2001c
Ready for service
homes 44,000 350,855 375,302 411,000 418,000
Internet
subscribers 420 8,499 14,624 20,489 24,442
Penetration 1.0 % 2.4 % 3.9 % 5.0 % 5.8 %
a Does not include Multikabel
b Proforma includes Multikabel
c Actual
PrimaCom, through Multikabel, launched digital television services in the Netherlands in the second quarter of 2000 and in Germany the service was soft launched in the fourth quarter of 2000. As of March 2001, PrimaCom reported digital television subscribers of 5,997, an 11% growth rate over the fourth quarter of 2000. The following table reflects the Digital Television subscriber growth and penetration:
1st 2nd 3rd 4th 1st
Quarter Quarter Quarter Quarter Quarter
2000a 2000b 2000c 2000c 2001c
Ready for service
homes 44,000 350,855 375,302 411,000 418,000
Digital
Television 0 1,067 2,453 5,395 5,997
Penetration 0 % 0.3% 0.7 % 1.3% 1.4 %
a Does not include Multikabel
b Proforma, includes Multikabel
c Actual
For the first quarter of 2001, digital television subscription fees contributed approximately E218,000 to revenue. Data communications data communications, application of telecommunications technology to the problem of transmitting data, especially to, from, or between computers. In popular usage, it is said that data communications make it possible for one computer to "talk" with another. services contributed over E626,000 to revenue in the 2001 first quarter, compared to virtually no revenues in the first quarter of 2000. Other income, which includes 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. , advertising and others, reached E1.1 million for the quarter. Financial Position As of March 31, 2001, PrimaCom's aggregate outstanding indebtedness INDEBTEDNESS. The state, of being in debt, without regard to the ability or inability of the party to pay the same. See 1 Story, Eq. 343; 2 Hill. Ab. 421. 2. was approximately E765.7 million, comprised of E750.0 million of bank debt outstanding, E12.6 million of capital leases obligations, and E3.0 million of deferred purchase obligations. Adjusted EBITDA offers full interest coverage. Based on current projections, the Company continues to have a fully-funded business plan. Paul Thomason, Speaker of the Executive Board and Chief Financial Officer, commented, "During the first quarter, PrimaCom continued to consolidate the acquisitions in both the Netherlands and Germany and recognize synergies. We also began to see the growth prospects of high speed Internet and digital television, as both products experienced double digit Noun 1. double digit - a two-digit integer; from 10 to 99 integer, whole number - any of the natural numbers (positive or negative) or zero; "an integer is a number that is not a fraction" growth in terms of subscribers from the fourth quarter of 2000 to the first quarter of 2001. The revenue contribution from our new high speed Internet, digital television and data communications services product offerings reached E1.5 million compared to virtually nothing in the same period in 2000. The improvement in our Adjusted EBITDA margin that began in the fourth quarter of 2000 continued, and reflects the Company's efforts on all fronts. Mr. Thomason concluded, "We believe we continue to possess the strongest balance sheet in the sector in Europe. We maintain substantial availability under our credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities and continue to enjoy a fully funded business plan. On the UPC (Universal Product Code) The standard bar code printed on retail merchandise, which is administered by GS1 US, Brussels, Belgium and Lawrenceville, NJ (www.gs1.org). Germany front, we continue to move forward towards a shareholders meeting in August and believe that our ability to recognize synergies in both operations and build out will create substantial growth opportunities for the combined company." In conjunction with this release, PrimaCom will host a conference call, which will be simultaneously broadcast live over the Internet. The call is scheduled for today, May 31, at: 5:00 PM (Germany) 4:00 PM (London) 11:00 AM EST EST electroshock therapy. EST abbr. electroshock therapy 10:00 AM CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. 8:00 AM PST PST Paroxysmal supraventricular tachycardia, see there Paul Thomason, Speaker of the Executive Board and Chief Financial Officer, and Hans Wolfert, Chief Corporate Development Officer will host the call. Listeners can access the conference call live over the Internet at http://www.streetfusion.com, or through a link in the international visitors section of the Company's web site at http://www.primacom.de. Please allow 15 minutes prior to the call to visit the sites to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. After the call has taken place, its archived version may be accessed at these web sites. About PRIMACOM (Neuer Markt, Frankfurt, PRC ID No. 625910 and Nasdaq PCAG) PrimaCom currently passes more than 1.8 million households and has approximately 1.3 million customers in Europe. In Germany, PrimaCom has approximately 1 million customers, making it the fourth largest private network provider. Of the 1 million subscribers approximately 11 per cent have been upgraded and are two way capable. A further 320,000 households are connected in the Netherlands; serving around 300,000 customers via an already fully upgraded cable network. PrimaCom provides customers with multi-media services via its own broadband cable network. In all, approximately one third of the PrimaCom networks have been fully upgraded to the latest broadband technology broadband technology Telecommunications devices, lines, or technologies that allow communication over a wide band of frequencies, and especially over a range of frequencies divided into multiple independent channels for the simultaneous transmission of different signals. . In Leipzig, Chemnitz , Magdeburg, Aschersleben, and Naumburg PrimaCom already offers 109,500 households attractive high speed Internet access at a flat rate via its own PrimaCom portal (www.cixity.de). Leipzig and the Netherlands are being served with approximately 80 digital TV programmes and other interactive services such as Pay-per-view TV, and this is soon to be extended to other German cities. With the introduction of digital television PrimaCom has introduced a range of interactive services that use a set-top box The cable TV box that sits on "top" of the TV "set," although it is often located several feet away in an equipment rack. The set-top box descrambles the premium channels and provides a tuner for the higher cable numbers that very old TVs did not support. as a platform. PrimaCom continues to develop as a multi-media communications company Communications Company is a communications unit of the United States Marine Corps. They are part of Combat Logistics Regiment 37 , 3rd Marine Logistics Group (3MLG) and III Marine Expeditionary Force (III MEF). The unit is based out of the Marine Corps Base Camp Smedley D. . This press release includes 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. within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Because these statements apply to future events, they are subject to risks and uncertainties that could cause actual results to differ materially, including PrimaCom's absence of an operating history subsequent to the Multikabel Acquisition and ist transformation to a broadband communications company, its possible future need for additional financing, competitive factors and restrictions imposed by existing and possible future debt instruments.
PRIMACOM AG
Three Three
months months
March, 2000 March 30,
2001
Euro 000 Euro 000
Revenues 27,063 38,852
Operating costs and expenses:
Operations 6,226 8,784
Selling, general and administrative 5,125 9,866
Corporate overhead 4,081 3,881
Depreciation and amortization 15,431 26,580
Total 30,863 49,111
Operating loss 3,800 10,259
Interest Expense:
Bank debt 3,105 16,660
Sale-leaseback 406 371
Total 3,511 17,031
Other income - 205
Loss from continuing operations
before income taxes and other items (7,311) (27,085)
Income tax (expense) benefit (221) 460
Loss from continuing operations before
minority interest and equity earnings (7,532) (26,625)
Minority interest in net income of subsidiaries 43 36
Equity loss in affiliate - 64
Loss before cumulative effect of change
in accounting principle (7.575) (26.725)
Cumulative effect of change
in accounting principle
(946)
Net loss (7,575) (27,671)
Loss per share basic and diluted (0.38) (1.40)
Weighted average shares 19,728,552 19,752,608
EBITDA 11,631 16,321
EBITDA-MARGIN 43.0 % 42.0 %
ADJUSTED EBITDA 12,592 17,164
ADJUSTED EBITDA MARGIN 46.5 % 44.2 %
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