-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EOGptjmOBx3Op94GPqk2gHu8MuufUpU+kPCElFA84QmhXND0SqK8mKTNO7YuOkGH 7dU3ns+yYTuHHkwRfGZKCQ== 0000950144-00-005869.txt : 20000505 0000950144-00-005869.hdr.sgml : 20000505 ACCESSION NUMBER: 0000950144-00-005869 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000503 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000504 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERMEDIA COMMUNICATIONS INC CENTRAL INDEX KEY: 0000885067 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 592913586 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-20135 FILM NUMBER: 618710 BUSINESS ADDRESS: STREET 1: 3625 QUEEN PALM DR STREET 2: STE 720 CITY: TAMPA STATE: FL ZIP: 33619 BUSINESS PHONE: 8138290011 MAIL ADDRESS: STREET 1: 3625 QUEEN PALM DRIVE CITY: TAMPA STATE: FL ZIP: 33619-1309 FORMER COMPANY: FORMER CONFORMED NAME: INTERMEDIA COMMUNICATIONS OF FLORIDA INC DATE OF NAME CHANGE: 19930328 8-K 1 INTERMEDIA COMMUNICATIONS, INC 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ----------------------- Date of Report (Date of earliest event reported): May 3, 2000 - -------------------------------------------------------------------------------- Intermedia Communications, Inc. (Exact name of registrant as specified in its charter) - -------------------------------------------------------------------------------- Delaware 59-2913586 -------- ---------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 0-20135 ------- (Commission File Number) 3625 Queen Palm Drive Tampa, FL 33619 (Address of principal executive offices) (813) 829-0011 (Telephone Number) 2 ITEM 5. Other Events On May 3, 2000, Intermedia Communications, Inc. (the "Company"), issued the attached press release. ITEM 7. Financial Statements and Exhibits Exhibit 99 Press Release, dated May 3, 2000. 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: May 3, 2000 INTERMEDIA COMMUNICATIONS, INC. (Registrant) /s/ Robert M. Manning ------------------------------ Robert M. Manning Senior Vice President and Chief Financial Officer EXHIBIT INDEX Exhibit No. Description Page 99 Press release dated May 3, 2000 EX-99 2 PRESS RELEASE DATED MAY 3, 2000 1 Exhibit 99 CONTACT: Curtis Lightburn Vice President, Investor Relations 813-829-2408 cglightburn@intermedia.com Alan Hill Director, Public Relations 813-829-4409 jahill@intermedia.com INTERMEDIA COMMUNICATIONS ANNOUNCES FIRST QUARTER RESULTS QUARTERLY REVENUE GROWS 28% TO $262 MILLION INTERMEDIA INSTALLS 65,000 ACCESS LINES AND REDUCES DEBT BY OVER $550 MILLION TAMPA, FL - MAY 3, 2000 - Intermedia Communications Inc. (Nasdaq: ICIX) today announced record revenue of $261.7 million for the quarter ending March 31, 2000. Consolidated EBITDA for the quarter was $15.2 million. "Intermedia continues to post better than expected financial and operating results," said David C. Ruberg, Intermedia's chairman, president and chief executive officer. "More importantly, the underlying trends in our business combined with our assets and core competencies give us great confidence in our ability to post increasingly strong results going forward." SUMMARY OF FIRST QUARTER 2000 RESULTS Revenue for the first quarter of $261.7 million was up 28 percent over first quarter 1999 revenue of $204.7 million. Consolidated EBITDA for the first quarter was positive $15.2 million, including EBITDA losses of $15.1 million at Digex. Intermedia and Digex also raised a total of $1.4 billion in capital as a result of equity investments by KKR in Intermedia and by Compaq and Microsoft in Digex, as well as a secondary offering of Digex common stock, and a sale of a portion of Intermedia's investment in Digex. The sale by Intermedia of stock in Digex resulted in a gain on sale of approximately $841 million, net of tax in the first quarter of 2000. "Intermedia made a number of moves which dramatically strengthen our position financially and strategically," said Robert M. Manning, Intermedia's chief financial officer. "At the end of the quarter, we had $1.3 billion in cash on hand. Consistent with our previous announcement, we have recently used a portion of the offering proceeds of our sale of Digex stock to reduce our debt levels by over $550 million. Our strong capital position, improved balance sheet and better operational performance, put us in a strong position to continue to accelerate our growth organically. Furthermore, the market demand for our unifiedvoice.net(sm) product and our accelerated rate of installations give us confidence that we will continue to scale our business." 2 REVENUE ANALYSIS Data, Internet and Web Hosting Data, Internet and Web Hosting services continued its strong growth. Revenue for the first quarter grew to $114.5 million, up from $78.4 million in the year ago period. Revenue grew in all categories, and was led by revenue growth at Digex, which grew 198 percent year-over-year to $28.0 million in the first quarter versus $9.4 million in the first quarter of 1999. Frame Relay, ATM and Internet revenue grew strongly year-over-year as a function of increasing demand for higher bandwidth connections, customer migration to fully managed networks and rapid increases from Intermedia's strategic partner channel. Intermedia increased its Frame and ATM switches by eight in the quarter to 193, and its Network to Network Data Interconnections (NNIs) by 78 to 959, by far the most of any provider in the country. Intermedia also entered into an agreement with equipment manufacturer Advanced Switching Communications, Inc. which will enable the Company to deliver the industry's first multi-link frame relay access solution. Local Access and Voice Local Access and Voice revenues for the first quarter grew to $108.5 million versus $102.3 million in the first quarter of 1999. In the first quarter, Intermedia increased access lines in service by 65,019, bringing the total in service at the end of the quarter to 566,113. All of the additions were on-switch. At the end of the first quarter, 89 percent of lines in service were on-switch, up from 87 percent at the end of the fourth quarter and up from 74 percent one year ago. Intermedia increased its on-net building count by 39 to 4,437. Intermedia's Advanced Building Networks (ABN) unit is now operational in 667 buildings, reflecting the turn up of services in 17 new buildings during the quarter. Intermedia has deployed DSLAMs in 280 of these buildings. Intermedia has implemented a Sonus Networks "soft-switch" for capacity expansion in Miami. This allows Intermedia to offer IP based voice and broadband data and Internet services and leverage its network architecture in a capital efficient manner. Systems Integration Systems Integration revenue for the quarter grew to $38.6 million from $24.0 million in the year ago period as a function of sales force expansion and market share gains. STRATEGIC FINANCINGS In the first quarter of 2000, Intermedia received a strategic investment of $200 million from a fund managed by Kohlberg Kravis Roberts & Co. Further, Digex received strategic investments from Compaq and Microsoft totaling $100 million. 3 Also in the first quarter, Intermedia and Digex completed the sale of 12.65 million shares of Digex (Nasdaq: DIGX) common stock raising $1.1 billion in gross proceeds. 10.65 million shares were sold by Intermedia, and 2.0 million shares were issued by Digex. For Digex, the proceeds will be used to fund the growth of its business. For Intermedia, a significant portion of the proceeds has been used to reduce Intermedia's debt levels. Intermedia owns 39.35 million shares of Digex stock and continues to be the majority owner. OUTLOOK "I believe the opportunities for Intermedia that are being presented by the Networked Economy are bigger and better than ever," added Ruberg. "By aligning with KKR, and with Compaq and Microsoft at Digex, we have considerably strengthened our strategic and financial position. Combined with our competitive strengths and core competencies in data and Internet services, I am confident in our ability to execute on our business plan and deliver superior shareholder returns." EBITDA consists of earnings before interest and other income, deferred compensation, income taxes, depreciation, amortization and charges for in-process R & D and business restructuring, integration and other expenses. EBITDA does not represent funds available for management's discretionary use and is not intended to represent cash flow from operations. EBITDA should not be considered as an alternative to net income (loss) as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. In addition, EBITDA is not a term defined by generally accepted accounting principles, and, as a result, the measure of EBITDA presented herein may not be comparable to similarly titled measures used by other companies. Statements contained in this news release regarding expected financial results and other planned events are forward-looking statements, subject to uncertainties and risks, including, but not limited to, the demand for Intermedia's services and the ability of the Company to successfully implement its strategies, each of which may be impacted, among other things, by economic, competitive or regulatory conditions. These and other applicable risks are summarized under the caption "Risk Factors" in the Company's Form 10-K Annual Report for its fiscal year ended December 31, 1999, and are updated periodically through the filing of reports and registration statements with the Securities and Exchange Commission. ABOUT INTERMEDIA Intermedia provides integrated solutions to business and government customers. These solutions include voice and data, local and long distance, and advanced network access services in major U.S. markets. Intermedia's enhanced data portfolio, including frame relay networking, ATM, and a full range of business Internet solutions and web hosting services, offers seamless end-to-end service virtually anywhere in the world. Intermedia is one of the top 5 Internet services providers (ISPs) to businesses and is consistently rated at or near the top of all ISPs for network performance and customer services by such industry publications as Keynote and Boardwatch. Intermedia is headquartered in Tampa, Florida. Intermedia can be found on the World Wide Web at www.intermedia.com. INTERNET USERS: Intermedia news releases, investor contacts and other useful information are available on Intermedia's Web site at www.intermedia.com. To receive news releases by e-mail or to request that information be mailed to you, please visit the Investor Relations section of the Web site, and go to the "Request Information" link. # # # 4 INTERMEDIA COMMUNICATIONS INC. Financial and Operating Highlights (In thousands, except share and operating data)
Three Months Ended March 31, ------------------------------- 2000 1999 ------------ ------------ (unaudited) (unaudited) Revenues: Local Access and Voice $ 108,544 $ 102,257 Data, Internet and Web Hosting 114,527 78,431 Integration Services 38,623 24,034 ------------ ------------ Total revenues 261,694 204,722 Expenses: Network operations 90,169 93,908 Facilities administration and maintenance 38,015 22,634 Cost of goods sold 26,689 15,804 Selling, general and administrative 91,647 57,295 Depreciation and amortization 89,310 71,611 Deferred compensation 3,664 21 Business restructuring, integration and other charges 2,630 5,399 ------------ ------------ Total operating expenses 342,124 266,672 ------------ ------------ Loss from operations (80,430) (61,950) Other income (expense): Interest expense (72,933) (62,178) Interest and other income 878,139 6,558 ------------ ------------ Net income (loss) before minority interest and income taxes 724,776 (117,570) Provision for income taxes 23,423 ------------ ------------ Income (loss) before minority interest 701,353 (117,570) Minority interest in net loss of subsidiary 8,299 ------------ ------------ Net income (loss) 709,652 (117,570) Preferred stock dividends and accretions (25,946) (22,483) ------------ ------------ Net income (loss) attributable to common stockholders $ 683,706 $ (140,053) ============ ============ Net income (loss) per common share: Net (loss) attributable to common stockholders before restructuring and gain on sale of Digex stock $ (2.94) $ (2.73) Gain on sale of Digex stock, net of income taxes 16.00 Charge for business restructuring, integration and other charges (0.05) (0.11) ------------ ------------ Basic net income (loss) per common share $ 13.01 $ (2.84) ============ ============ Diluted net income (loss) per common share $ 9.02 $ (2.84) ============ ============ Shares used in computing basic and diluted net Income (loss) per share: Basic 52,545,409 49,352,830 Diluted 77,010,101 49,352,830 EBITDA (1) $ 15,174 $ 15,081 Operating Data: (2)
March 31, 2000 December 31, 1999 -------------- ----------------- Data, Internet and Web Hosting Assets Web hosting servers 2,911 2,311 Data switches in operation 193 185 NNI connections 959 881 Access and Voice Assets Buildings (3) 4,437 4,398 Voice switches in operation 29 29 Access line equivalents 566,113 501,094 Employees 5,423 5,073
(1) EBITDA before certain charges consists of earnings (net loss before minority interest) before interest and other income, deferred compensation, income taxes, depreciation, amortization, charges for in-process R&D and business restructuring, integration and other expenses. EBITDA before certain charges does not represent funds available for management's discretionary use and is not intended to represent cash flow from operations. EBITDA before certain charges should not be considered as an alternative to net income (loss) as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. In addition, EBITDA before certain charges is not a term defined by generally accepted accounting principles, and, as a result, the measure of EBITDA before certain charges presented herein may not be comparable to similarly titled measures used by other companies. (2) Amounts reflected in the table are based upon information contained in the Company's operating records. (3) Includes both on-net direct connections with Intermedia-owned fiber optic cable and on-net extended high capacity connections with leased circuits. -----END PRIVACY-ENHANCED MESSAGE-----