For full year 2000, revenue totaled $103.0 million, a 162 percent increase over full year 1999.
Fourth quarter revenue mix showed a continued positive shift towards the sale of value-added services. 50 percent of the quarter’s revenue came from value-added Internet products and services, 44 percent from business access services and 6 percent from residential access services. Value-added services revenue (including revenue from 52,900 hosted web sites) showed an 18 percent increase over third quarter, due to our continued focus on value added services sales and high value added services revenue mix in our late third and early fourth quarter acquisitions. Business access revenue decreased by 14 percent due to the continuing run-off of revenues under one low margin, wholesale contract, which fits with VIA’s strategy of focusing on higher margin revenue streams. Residential access revenue continued to run off, decreasing by 8 percent from third quarter levels. VIA does not market to wholesale and residential customer bases.
VIA’s fourth quarter revenues continued to be impacted by declining exchange rates, especially in the Euro, Euro-linked and British Pound currencies.. On a local currency basis, quarterly revenues were 3 percent higher than reported. Excluding the impact of exchange rates and the one low margin, wholesale contract, which reduced business access revenues, VIA experienced 14 percent sequential quarter revenue growth in the fourth quarter. Of this growth, 7 percent was organic and 7 percent came from acquisitions completed late in the third quarter and early in the fourth quarter.
VIA reported an EBITDA loss for the fourth quarter of $8.7 million and an EBITDA loss of $27.5 million for full year 2000. Net loss available to common stockholders was $19.3 million, or ($0.32) per share, for the fourth quarter and $74.2 million, or ($1.40) per share, for full year 2000. The fourth quarter net loss included non-cash compensation charges of $1.3 million or ($0.02) per share related to the Company’s stock option plans and $14.9 million or ($0.25) per share in depreciation and amortization charges, of which $12.0 million represented the amortization of goodwill and other intangible assets arising from the Company’s acquisition activities. VIA’s net loss was improved by $2.5 million, or $0.04 per share, in interest income and $4.8 million, or $0.08 per share, in foreign currency gains recognized during the quarter. Foreign currency gains were related to Euro balances that the Company maintains in order to fund European operations, and to the valuation of intercompany balances.
The Company’s cost of Internet services decreased to 50 percent of revenue from 56 percent in the prior quarter. Increased higher margin value added services sales, the sale or run-off of low margin customer bases and negotiated credits from telecommunications providers in certain of our markets accounted for the decrease. Sales and marketing expenses equaled 23 percent of revenue, up from 21 percent in the prior quarter, due primarily to continued increases in sales staffing and training. General and administrative expenses equaled 58 percent of revenue, up from 45 percent in the prior quarter. This increase was due primarily to higher than average G&A expenditure rate in the companies we acquired during the late third and early fourth quarters, and costs associated with our integration activities. As a result, VIA’s EBITDA margin deficit increased to 31 percent from 22 percent in the prior quarter.
VIA continued to see growth in its target customer base during the fourth quarter. At December 31, 2000, the Company had 80,800 business customers out of a total customer base of 141,200. This represented a 5 percent increase in business customers over business customer counts at September 30, 2000. Total customers declined by 1% from September 30 customer counts due to the sale or run off of low margin, residential customer bases. On an annualized basis, average revenue per business customer was $1,348, and for all customers, average revenue per customer was $796. This represented a decrease of 10 percent in average revenue per business customer and 5 percent in average revenue for all customers. The decreases were due primarily to declining revenues under the low margin, wholesale contract and the sale or run off of lower priced residential business.
Cash and cash equivalents at December 31, 2000 totaled $237.8 million. VIA continued to maintain a low debt position with only $5.2 million of debt on its balance sheet.
SOURCE: COMPANY PRESS RELEASE
