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Press ReleaseSource: DSL.net, Inc.
DSL.net Reports 4Q, Full-Year 2002 Results
Thursday March 6, 8:46 am ET
2002 Adjusted EBITDA Improves 84% and Free Cash Flow Improves 83% Over Previous Year
NEW HAVEN, Conn.--(BUSINESS WIRE)--March 6, 2003--DSL.net, Inc. (NASDAQ: DSLN - News), a leading nationwide provider of broadband communications services to businesses, today reported fourth quarter and full-year 2002 financial results.
Revenue for the fourth quarter of 2002 was $11.3 million, representing a 2% increase from fourth quarter 2001 revenue of $11.1 million and a slight increase over third quarter 2002 revenue. Revenue for the year ended Dec. 31, 2002, was $45.5 million, an 8.5% increase over revenue of $42.0 million for 2001. The Company ended the fourth quarter with more than 22,100 installed broadband subscriber lines.
Net loss for the fourth quarter of 2002 was $8.8 million, representing an 18% improvement compared to a net loss of $10.7 million for the fourth quarter of 2001. The Company's third quarter 2002 net loss was $8.5 million, which included a $600,000 non-recurring net research and development credit. Excluding the third quarter credit, net loss for the fourth quarter improved by 3% on a sequential basis. Net loss for the year ended Dec. 31, 2002, was $36.1 million, a 69% improvement over the net loss of $115.5 million for the year ended Dec. 31, 2001.
Earnings before interest, taxes, depreciation, amortization and non-cash stock compensation ("Adjusted EBITDA") for the fourth quarter of 2002 was negative $3.5 million, a 28% improvement compared to negative $4.9 million in the fourth quarter 2001. The Company's Adjusted EBITDA was negative $3.0 million for the third quarter 2002. Excluding the third quarter credit, Adjusted EBITDA for the fourth quarter improved slightly on a sequential basis. Adjusted EBITDA for the year ended Dec. 31, 2002, was negative $14.3 million, representing an 84% improvement compared to negative $86.7 million for 2001.
Free cash flow (defined as Adjusted EBITDA minus capital expenditures) for the fourth quarter of 2002 was negative $3.9 million, a 30% improvement over fourth quarter 2001 free cash flow of negative $5.6 million. Free cash flow for the third quarter 2002 was negative $3.4 million. Excluding the third quarter credit, free cash flow for the fourth quarter improved by 3% on a sequential basis. Free cash flow for the year ended Dec. 31, 2002, was negative $15.9 million, which represents an improvement of 83% over the negative $92.0 million of free cash flow for 2001.
"Our continued improvements in Adjusted EBITDA and free cash flow are consistent with our primary objective of generating improved cash flows," said David F. Struwas, chairman and chief executive officer of DSL.net. "Just as important, we continued to pursue external growth opportunities in 2002 and gained court approval in the fourth quarter to acquire network assets and related subscriber lines of Network Access Solutions Corporation (NAS), a transaction we closed in January 2003."
At the end of 2002, the Company had $11.3 million in cash. The Company used $7.4 million of its cash in January to close the NAS acquisition. As part of its ongoing financing activities, around the end of the year, the Company arranged a $15 million revolving credit facility for general corporate purposes, with availability based on third-party guarantees. To date, $9.1 million of such guarantees has been secured.
In addition to the NAS acquisition activities in 2002, DSL.net made two smaller acquisitions during the year - acquiring customer lines from Broadslate Networks in January and Abacus America in August.
On a per share basis, the Company reported a net loss applicable to common stockholders of $0.20 per share for the fourth quarter of 2002, compared to $0.17 per share for the same quarter a year earlier. For the year ended Dec. 31, 2002, net loss per share applicable to common stockholders was $0.77 per share, which represents a 57% improvement over net loss of $1.81 per share for the prior year. The 2002 periods included significant charges for dividends and accretions on preferred stock while the 2001 periods did not. These 2002 charges translated into $0.06 per share for the fourth quarter 2002 and $0.21 per share for the entire year. There was no per share impact in 2001.
DSL.net will host a conference call to discuss results for the quarter and full-year 2002 today at 11 a.m., Eastern Time. Interested parties may listen to the live audio webcast of the call by visiting the investor relations section of DSL.net's Web site, www.dsl.net. The call also may be accessed live via telephone by dialing 800-289-0436, confirmation code 514705. For those unable to access the live conference call, an audio replay will be available until 11 p.m., Eastern Time, on March 10, 2003, by dialing 888-203-1112 and entering code 514705. Investors may also access the call replay by visiting the investor relations section of the Company's Web site.
