Cbeyond Reports Second Quarter 2013 Results

ATLANTA, July 31, 2013 (GLOBE NEWSWIRE) -- Cbeyond, Inc. (Nasdaq:CBEY), ("Cbeyond"), the technology ally for small and mid-sized businesses, today announced its results for the second quarter ended June 30, 2013.

Recent financial and operating highlights include:
  • Second quarter 2013 total revenue of $118.2 million compared with $123.8 million in the second quarter of 2012 and $119.9 million in the first quarter of 2013;  
  • Cbeyond 2.0 revenue was $16.1 million, or 13.6% of total revenue in the second quarter of 2013, an increase of 100% from the second quarter of 2012 and an increase of 17% from the first quarter of 2013;   
  • Average monthly revenue per customer (ARPU) of $662 during the second quarter of 2013 compared with $645 in the second quarter of 2012 and $656 in the first quarter of 2013 (see selected quarterly operating metrics table for an ARPU definition);  
  • Adjusted EBITDA of $21.9 million in the second quarter of 2013 compared with $27.2 million in the second quarter of 2012 and $20.8 million in the first quarter of 2013 (see reconciliation tables for reconciliation to net loss);  
  • Free cash flow (defined as adjusted EBITDA less cash capital expenditures) of $7.1 million in the second quarter of 2013 compared with $12.5 million in the second quarter of 2012 and $8.4 million in the first quarter of 2013;  
  • Net loss of less than $0.1 million in the second quarter of 2013 compared with net income of $2.7 million in the second quarter of 2012 and a net loss of $0.6 million in the first quarter of 2013;  
  • Revised annual guidance for 2013 of $464 million to $471 million of revenue, $76 million to $80 million of adjusted EBITDA, $56 million to $60 million of cash capital expenditures, and $18 million to $22 million of free cash flow;  
  • Board approves up to $20 million share repurchase plan expiring June 30, 2015. 

Financial Overview and Key Operating Metrics

Financial and operating metrics, which include non-GAAP financial measures, for the three and six months ended June 30, 2013, include:
  For the Three Months Ended June 30,
  2012 2013 Change % Change
Selected Financial Data (dollars in thousands)        
Revenue (total)  $ 123,762  $ 118,215  $ (5,547) (4.5%)
Operating expenses  $ 118,119  $ 117,791  $ (328) (0.3%)
Operating income (loss)  $ 5,643  $ 424  $ (5,219) (92.5%)
Net income (loss)  $ 2,694  $ (41)  $ (2,735) (101.5%)
Capital expenditures (total)  $ 15,722  $ 20,065  $ 4,343 27.6%
         
Key Operating Metrics and Non-GAAP Financial Measures
(dollars in thousands, except Average Monthly Revenue Per Network Access Customer)
Network Access Customers (At Period End)  62,015  57,013  (5,002) (8.1%)
Net Network Access Customer Additions  (450)  (1,421)  (971) (215.8%)
Average Monthly Churn Rate 1.5% 1.6% 0.1% 6.7%
Average Monthly Revenue Per Network Access Customer  $ 645  $ 662  $ 17 2.6%
Adjusted EBITDA  $ 27,236  $ 21,929  $ (5,307) (19.5%)
Cash capital expenditures  $ 14,765  $ 14,780  $ 15 0.1%
         
         
  For the Six Months Ended June 30,
  2012 2013 Change % Change
Selected Financial Data (dollars in thousands)        
Revenue (total)  $ 247,605  $ 238,161  $ (9,444) (3.8%)
Operating expenses  $ 243,287  $ 237,955  $ (5,332) (2.2%)
Operating income (loss)  $ 4,318  $ 206  $ (4,112) (95.2%)
Net income (loss)  $ 1,500  $ (597)  $ (2,097) (139.8%)
Capital expenditures (total)  $ 32,958  $ 35,516  $ 2,558 7.8%
         
Key Operating Metrics and Non-GAAP Financial Measures
(dollars in thousands, except Average Monthly Revenue Per Network Access Customer)
Network Access Customers (At Period End)  62,015  57,013  (5,002) (8.1%)
Net Network Access Customer Additions  (154)  (2,679)  (2,525) N/M
Average Monthly Churn Rate 1.5% 1.6% 0.1% 6.7%
Average Monthly Revenue Per Network Access Customer  $ 647  $ 660  $ 13 2.0%
Adjusted EBITDA  $ 50,210  $ 42,762  $ (7,448) (14.8%)
Cash capital expenditures  $ 29,601  $ 27,214  $ (2,387) (8.1%)

Management Comments

"I am pleased with the progress we are making at transitioning our company from a communications centric business to a cloud solutions provider for the small and mid-sized business segment," said Jim Geiger, chief executive officer of Cbeyond, Inc. "This quarter, our 2.0 revenue doubled from the second quarter last year and our 2.0 metrics, such as ARPU and sales productivity, are moving in the right direction."

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