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GST Telecommunications Reports Record Year-End Revenue Growth of 121 Percent.

VANCOUVER, WASHINGTON--(BUSINESS WIRE)--Nov. 25, 1996--GST TELECOMMUNICATIO (AMEX GST ) GST Telecommunications, Inc., a full-service telecommunications provider, announced today record revenues of US $41.3 million for the fiscal year ended September 30, 1996, an increase of 121 percent over revenues for the fiscal year ended September 30, 1995, of $18.7 million. The Company reported a net loss of US $60.4 million, or $3.18 per share, compared to a 1995 net loss of US $11.3 million, or $0.82 per share.

Robert H. Hanson, Chief Financial Officer for GST Telecommunications, Inc., stated, "We are extremely pleased with the results of operations, both for the fiscal fourth quarter and the full year. The significant increase in revenues is attributable to the acceleration of revenue growth in our CLEC operations, and the continued growth of our long distance, Internet and data businesses." Hanson continued, "Moreover, we are pleased to report that our manufacturing subsidiary, National Applied Computer Technologies (NACT) enjoyed a record year, and continues to benefit from strong market acceptance of its new switch platform, the STX. The acquisition of Call America Business Communications Corporation occurred late in the fiscal year, and contributed modestly to revenue for the fourth quarter and the year. Additionally, the acquisition of TotalNet occurred exceptionally late in the year as well. However, with a combined annual run rate of $33 million for Call America and TotalNet, we expect these two companies to make a substantial contribution to revenues in fiscal 1997."

GST's fourth quarter operating milestones include:

-Agreed to purchased 11 Siemens Stromberg-Carlson switches with a mutual option to purchase 11 additional switches as part as an overall $240 million vendor financing package;

-Deployed 4 Nortel DMS-500 Supernode switches in Tucson, Albuquerque, Honolulu and the Los Angeles basin;

-Signed a $5.1 million contract with Nortel to install Nortel's Rapport Dialup switches for the launch of GST Internet services;

-Acquired control of GST Global (VSE:GGB), under which GST will conduct certain of its International activities. GST Global and Occidental de Telecomunicacion signed an agreement to form Bestel, which will build and operate a 2268-kilometer fiber optic network and will connect 12 cities in Mexico;

-Acquired Houston-based Texas-Ohio Communications, Inc., a full- service long distance reseller that provides 1+, toll free service, operator services and calling cards;

-Acquired Call America Business Communications, a facilities-based reseller that provides a variety of domestic and international long distance services;

-Acquired Houston-based TotalNet Communications, a full-service long distance provider;

-Continued the expansion of its Shared Tenant Services (STS) with the acquisition of Tri-Star Communications, Inc., a Washington-based STS company;

-Secured a California PUC-approved interconnection agreement with GTE, received a franchise for Salt Lake City and turned up operations in Spokane.

John Warta, President and CEO, stated, "To significantly accelerate the expansion of our CLEC networks, we've signed electric utility agreements with the Los Angeles Department of Water & Power, Southern California Edison Company, Hawaiian Electric Company, Portland General Electric, Idaho Power, Tucson Electric, and Washington Water & Power. Further, at the fiscal year end, the Company had a total of 17 franchise agreements. GST experienced remarkable internal growth throughout the fiscal year expanding 196 percent from 222 employees at September 30, 1995 to 658 employees at September 30, 1996."

He continued, "In addition to reaching record revenue growth again, we've also achieved significant network gains that demonstrate our commitment to becoming a leading CLEC. We've kept sight of our regional focus, building additional infrastructure throughout the western United States. For the fiscal year ending September 30, 1996, the Company had 17 operational cities, a 183 percent increase compared to six operational cities for the fiscal year ending September 30, 1995. Furthermore, GST had 32 cites under development at the fiscal year-end 1996, versus nine cities under development, at September 30, 1995, amounting to a 256 percent increase. During the same fiscal period, GST expanded its network capacity as reflected in a 237 percent increase of buildings On-Net from 219 for fiscal 1995 to 739 for fiscal 1996. By fiscal year-end 1996, GST's networks covered 1,437 route miles, a 151 percent increase from 573 route miles in service at the end of September 1995. GST also expanded its network from 19,473 fiber miles to 32,295 fiber miles, for a 66 percent year-over-year increase for the fiscal year ending September 30, 1995."

GST continues to emphasize the development, construction and expansion of its CLEC networks and customer base, hence expecting that its operating and net losses will continue. The Company has financed, and expects to continue to finance, its capital expenditures, acquisitions and working capital requirements primarily through vendor financing and the sale of equity and debt securities. Capital expenditures, including cash and accrued payments, for the year ending September 30, 1996 were $89 million compared to $32 million, year ending September 30, 1995. These expenditures will facilitate the expansion, development and construction of the Companys networks, the acquisition and deployment of switches and related equipment to facilitate the offering of advanced telecommunications services and the further development of internal management and accounting systems. -0-


GST Telecommunications, Inc.

Consolidated Results of Operations
(in thousands, except for per share data)

 Three Months Ended Twelve Months Ended
 September 30, September 30,
 1996 1995 1996 1995

Revenues:
 Telecommunication
 services $12,273 $5,221 $31,726 $11,118
 Product 3,802 1,928 9,573 7,563
 ----------------- --------------------
 Total revenue 16,075 7,149 41,299 18,681
 ----------------- --------------------

Operating costs and expenses:
 Network expenses 11,658 5,127 26,580 10,103
 Facilities
 administration
 and maintenance 4,524 824 10,317 2,096
 Cost of product
 revenues 1,170 746 3,973 3,096
 Selling, general
 and administrative 12,686 4,351 33,375 11,373
 Research and
 development 442 416 1,352 1,270
 Depreciation and
 amortization 2,914 1,069 8,299 2,374
 ------------------ -------------------
Total operating
 costs and expenses 33,394 12,533 83,896 30,312
 ------------------ --------------------
 Loss from
 operations (17,319) (5,384) (42,597) (11,631)
 ------------------ --------------------

Other expense (income):
 Interest expense,
 net of amounts
 capitalized 6,423 500 21,224 838
 Minority interest
 in loss of
 subsidiaries (77) (767) (411) (2,364)
 Other (387) 775 (3,032) 1,210
 ------------------- -------------------
Loss for the
 period $(23,278) $ (5,892) $ (60,378) $ (11,315)
 ------------------- ----------------------
Loss per share $ (1.14) $ (0.35) $ (3.18) $ (0.82)
 ------------------- ----------------------
Weighted average
common and common
equivalents shares
outstanding 20,404 16,624 18,988 13,781
 ------------------- ---------------------
Earnings before
 interest, taxes,
 depreciation
 and amortization
 (EBITDA) $ (14,315)$ (4,148) $ (33,936) $ (8,807)
 ------------------ -----------------------

GST Telecommunications,Inc.
Selected Statistical Data
 September 30, September 30, INCREASE
 1995 1996 (percent)
Cities Served 6 17 183 percent
Cities under
 Construction 9 32 256 percent
Route Miles 573 1,437 151 percent
GST Owned
 Fiber Miles 17,329 27,635 60 percent
Leased Fiber
 Miles 2,144 4,660 117 percent
Total Fiber
 Miles 19,473 32,295 66 percent
Buildings
 On Line 154 271 76 percent
Buildings
 On Net 219 739 237 percent
Total Customers NA (x) 38,725 --
Voice Grade
 Equivalents NA (x) 473,000 --





GST Telecommunications, Inc., headquartered in Vancouver, Washington, currently operates networks in 18 cities and has 31 additional networks under development in the western United States and Hawaii. The company provides a broad range of integrated telecommunications products and services through the development and operation of competitive access and other telecommunications networks. GST's strategy is to cluster several cities in each state it enters in order to achieve synergy and maximum opportunity within each service territory. In addition, the Company manufactures telecommunications switching equipment and provides network management and billing systems through its wholly-owned subsidiary, National Applied Computer Technologies, Inc., of Orem, Utah. GST provides comprehensive Internet services through GST Internet and Hawaii OnLine, Hawaii's largest Internet service provider. (x) (Not Available) -0-

Visit GST's web sites at: www.gstcorp.com, www.gstis.net, www.planet-hawaii.net

CONTACT: GST Telecommunications, Inc.

Rob Blankstein, 800/667-4366

or

GST Telecommunications, Inc.

John Warta, 360/ 254-4700

or

GST Telecommunications, Inc.

Robert Hanson, 307/ 527-6048

INTERNET: http://www.gstcorp.com

INTERNET: http://www.planet-hawaii.net
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Publication:Business Wire
Date:Nov 25, 1996
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