PSINet Inc, the veteran internet service provider continues to rack up the kind of losses that would make most companies wince, but this is the world of internet service provision, where such things are commonpplace. PSINet turned in second quarter net losses of $11.3m, down from $10.6m the year before and were a shade better than Wall Street was expecting. PSINet got out of the consumer ISP business last year to concentrate on the business world, and to that end had 21,900 corporate accounts at the halfway stage, compared to 12,400 the year before. Second quarter net revenues were up 46% to $29.5m. The company lost 500 corporate accounts during the quarter when it terminated its minority interests the Netherlands and South Korea. It also got tough with some other accounts that had questionable payments histories – a move that obviously lowered its corporate retention rate and increased bad debt expense, but in the long term will help its bad debt reserves. The company added fewer corporate accounts in the second quarter compared to the first, but it said they had a 27% greater annualized contract value. During the quarter Herndon, Virginia-based PSINet abandoned a proposed European joint venture with Chatterjee Management Co, but PSINet said it would continue to expand its European operations in the UK, Germany and Belgium. And to that end PSINet has extended its extranet service for business-to-business trusted connections internationally. It’s offering a turnkey product comprising definition of the network boundaries, arranging the telecoms circuit provision, providing and configuring of the equipment and development of the security policy. The service is available now in the US, Canada, Japan, UK and the rest of Europe. Net losses for the six months were $20.6m, after a $5.7m gain from the sale of the company’s Intercon Systems Corp software unit, down from losses last time of $25.8m, on revenues that rose 47% to $55.1m. Cash at the halfway stage stood at $52.0m. PSINet is not expected to be profitable until the second quarter of next fiscal.
