Zayo Group Holdings, Inc. Reports Financial Results For The First Fiscal Quarter Ended September 30, 2016

Zayo Group Holdings, Inc. ("Zayo" or "the Company") (NYSE: ZAYO), the global leader in Communications Infrastructure, announced results for the three months ended September 30, 2016.

First quarter operating income increased $15.0 million and net income increased by $46.6 million over the previous quarter. Basic and diluted net income per share during the first fiscal quarter was $0.06. During the three months ended September 30, 2016, capital expenditures were $208.3 million, including $3.3 million attributed to Zayo Canada.

As of September 30, 2016, the Company had $193.0 million of cash and $442.1 million available under its revolving credit facility.

First Fiscal Quarter Financial Results

Three Months Ended September 30, 2016 and June 30, 2016

(in millions)
       
Three months ended
September 30, 2016 June 30, 2016
Revenue $ 504.9 $ 507.3
Annualized revenue growth -2 %
Operating income 87.0 72.0
Income/(loss) from operations before income taxes 22.3 (44.0 )
Provision/(benefit) for income taxes   6.6     (13.1 )
Net income/(loss) $ 15.7   $ (30.9 )
 
Adjusted EBITDA $ 260.6 $ 257.8
Annualized Adjusted EBITDA growth 4 %
Adjusted EBITDA margin 52 % 51 %
 
Levered free cash flow/(deficit) $ 24.5   $ (11.2 )
 
       

Three Months Ended September 30, 2016 and September 30, 2015

(in millions)
 
Three months ended
September 30, 2016 September 30, 2015
Revenue $ 504.9 $ 366.8
Annualized revenue growth 38 %
Operating income 87.0 52.1
Income/(loss) from operations before income taxes 22.3 (12.5 )
Provision for income taxes   6.6     2.7  
Net income/(loss) $ 15.7   $ (15.2 )
 
Adjusted EBITDA $ 260.6 $ 215.4
Annualized Adjusted EBITDA growth 21 %
Adjusted EBITDA margin 52 % 59 %
 
Levered free cash flow $ 24.5   $ 36.0  
 

Conference Call

Zayo will hold a conference call to report first fiscal quarter 2017 results at 5:00 pm. EST, November 8, 2016. The dial in number for the call is 800-941-1366, (ID: 21820198). A live webcast of the call can be found in the investor relations section of Zayo's website or can be accessed directly at https://cc.readytalk.com/r/fh5irvjhnqby&eom. During the call, the Company will review an Earnings Presentation that summarizes the financial, operational and commercial highlights of the quarter, which can be found at http://investors.zayo.com/earnings-releases. The Company's Supplemental Earnings Information presentation will be made available in the investor relations section of Zayo's website after the conclusion of the conference call.

About Zayo

Zayo Group Holdings, Inc. (NYSE: ZAYO) provides communications infrastructure services, including fiber and bandwidth connectivity, colocation and cloud services to the world's leading businesses. Customers include wireless and wireline carriers, media and content companies and finance, healthcare and other large enterprises. Zayo's 114,500-mile network in North America and Europe includes extensive metro connectivity to thousands of buildings and data centers. In addition to high-capacity dark fiber, wavelength, Ethernet and other connectivity solutions, Zayo offers colocation and cloud services in its carrier-neutral data centers. Zayo provides clients with flexible, customized solutions and self-service through Tranzact, an innovative online platform for managing and purchasing bandwidth and services. For more information, visit zayo.com.

Forward-Looking Statements

Information contained in this earnings release that is not historical by nature constitutes "forward-looking statements" which can be identified by the use of forward-looking terminology such as "believes," "expects," "plans," "intends," "estimates," "projects," "could," "may," "will," "should," or "anticipates" or the negatives thereof, other variations thereon or comparable terminology, or by discussions of strategy. No assurance can be given that future results expressed or implied by the forward-looking statements will be achieved and actual results may differ materially from those contemplated by the forward-looking statements. Such statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, those relating to the Company's financial and operating prospects, current economic trends, future opportunities, ability to retain existing customers and attract new ones, outlook of customers, and strength of competition and pricing. In addition, there is risk and uncertainty in the Company's acquisition strategy including our ability to integrate acquired companies and assets. Specifically there is a risk associated with our recent acquisitions, and the benefits thereof, including financial and operating results and synergy benefits that may be realized from these acquisitions and the timeframe for realizing these benefits. Other factors and risks that may affect our business and future financial results are detailed in the "Risk Factors" section of our Annual Report on Form 10-K filed on August 26, 2016 with the Securities and Exchange Commission (our "Annual Report"). We caution you not to place undue reliance on these forward-looking statements, which speak only as of their respective dates. We undertake no obligation to publicly update or revise forward-looking statements to reflect events or circumstances after releasing this supplemental information or to reflect the occurrence of unanticipated events, except as required by law.

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