Nextlink beats estimates, but losses swell

Jan. 2, 2002 4:43 p.m. PT

2 min read

Nextlink Communications Inc. (Nasdaq: NXLK) scraped by estimates Tuesday with a first quarter loss of $1.59 a share. First Call Corp. was expecting a loss $1.61 a share.

Shares in the provider of broadband communications services, were up 3 13/16 to 71 13/16, or 6 percent

Loss widened again as the company continued to build out its network. EBITDA loss (operating loss before depreciation, amortization and deferred compensation expense) was $63.1 million, compared to an EBITDA loss of $47.4 million in the first quarter of 1999. Nextlink also reported losses in its fourth quarter.

In the first quarter, Nextlink also recorded $225 million of other income reflecting the gain realized on the sale of a strategic equity investment. Taking this gain into account, the company had net income of 7 cents a share for the quarter. Excluding the impact of this one time sale, net loss is $1.59 a share.

Total revenue grew to $105.8 million in the first quarter, up 18 percent over the fourth quarter's revenue, and up 118 percent over revenue reported in the first quarter of 1999.

Core services revenue, consisting of bundled local and long distance, as well as dedicated services, was $91.8 million, up 23 percent over the fourth quarter.

Growth in access line installations added 93,104 lines during the first quarter, an 18 percent increase over net access lines installed in the fourth quarter of 1999, and an 84 percent increase over the 50,531 net access lines added in the first quarter of 1999.

Nextlink recently agreed to merge with Concentric Network Corp. (Nasdaq: CNCX) in a deal valued at about $2.9 billion. The merger is expected to close in the second quarter of this year.

Last week, as part of its launch of new voice and data services, the company announced a private label agreement with Concentric to provide digital subscriber line (DSL) services, dedicated and shared web hosting and e-commerce services.

Nextlink competes with SBC Communications (NYSE: SBC), Bell Atlantic (NYSE: BEL) and US West (NYSE: USW).