CapRock Communications Corp. (Nasdaq: CPRK), which constructs fiber optic networks, said Thursday it will suffer an unforeseen loss in its second quarter due to the absence of an anticipated $30 million contract for the sale of dark fiber.
The integrated telecommunications provider offers local, long-distance, private line, Internet, and data services to more than 5,000 small and midsized businesses. It also provides "carrier's carrier" services, including dark fiber services and long-distance terminating access, to more than 100 telecom companies.
CapRock's competitors include AT&T (NYSE: T) and SBC Communications (NYSE: SBC), according to Hoover's Online.
CapRock now sees second quarter revenue in the range of $43 million to $44 million, an EBITDA loss of $17 million to $18 million, and a second quarter loss of 50 to 53 cents a share.
First Call was expecting the company to lose just 15 cents a share
For the second quarter of 1999, the comparable results were revenue of $37.6 million, EBITDA of $2.6 million, and a net loss of 6 cents per basic and diluted common share.
The loss of CapRock's $30 million contract came as a surprise, just at the end of the quarter, the company said.
The cancellation will "significantly impact... gross margins, EBITDA and earnings per share" because of the high margins associated with the sale of dark fiber, CEO and chairman W. Thompson, Jr., said in a statement.
The cancellation is not expected to significantly affect CapRock's results for the third and fourth quarters, the company added.
Dark fiber sales are a means to an end, while Integrated Services is CapRock's long-term focus, the company said. It reported progress in its Integrated Services business, which includes local, long distance, data and Internet services sold to business customers. The company also said fiber, voice and data network deployments are on schedule.
CapRock will announce its actual results on July 27, 2000.