Navisite Reports Second Quarter Fiscal Year 2011 Financial Results
Navisite, LLC (NASDAQ: NAVI), a premier provider of enterprise-class hosting, managed application, managed messaging and managed cloud services, today reported financial results for the second quarter of fiscal year 2011 ended January 31, 2011.
Navisite completed the sale of its Dallas colocation data centre during the second quarter of fiscal year 2011, for gross cash proceeds of $12.75 million. The results of operations reported exclude the results of discontinued operations for the periods presented.
Financial Results for the Second Quarter of Fiscal Year 2011
Total revenue for the quarter ended January 31, 2011 was $32.4 million, representing a year-over-year increase of 7% and a sequential increase of 1%. Recurring hosting revenue was $31.3 million for the second quarter, representing a year-over-year increase of 8% and a sequential increase of 1%. EBITDA, excluding impairment costs, stock-based compensation, severance and other non-operational charges (“EBITDA, as adjusted”) for the second quarter was $7.4 million, representing a year-over-year increase of 13% and a sequential increase of 3%. Net income attributable to common shareholders for the second quarter was $4.8 million, or $0.13 per share, compared to a loss of $2.9 million, or $(0.08) per share, in the second quarter of fiscal year 2010. The net income for the second quarter was mainly due to the gain on the sale of our Dallas colocation data centre.
Financial and Business Highlights
- Time Warner Cable Inc. (NYSE: TWC) and Navisite announced an agreement under which Time Warner Cable will acquire Navisite for $5.50 per common share in cash, or a total equity value of approximately $230 million.
- Announced the sale of our Dallas, Texas colocation business to Cologix Dallas, Inc., a subsidiary of Cologix, Inc., for $12.75 million in cash.
- Booked $0.6 million of incremental monthly revenue with an average term of 16 months in the second quarter of fiscal year 2011 compared to $0.7 million booked in the second quarter of fiscal year 2010 with an average term of 24 months.
- Booked $0.1 million of cloud expected monthly recurring revenue in our second quarter of cloud availability, an increase of 34% from the prior quarter and representing over 17% of our total bookings for the quarter.
- Client churn, defined as the loss of a client or a reduction in a client’s monthly recurring revenue from our active client pool, was 1.1% per month during the quarter, compared to 1.1% per month in second quarter of fiscal year 2010 and 1.2% in the prior quarter.
EBITDA and Other Non-GAAP Measures EBITDA is not a recognised measure for financial-statement presentation under United States generally accepted accounting principles (“GAAP”). Navisite believes that non-GAAP measures, such as EBITDA and adjusted EBITDA, provide investors with useful supplemental measures of our actual and expected operating and financial performance by excluding the impact of interest, taxes, depreciation and amortization from net income (loss). We also exclude impairment costs, stock-based compensation, severance, discontinued operations, related gain on discontinued operations, and other non-recurring charges, as such items may be considered to be of a non-operational nature. EBITDA, as adjusted, does not have any standardised definition and therefore may not be comparable to similar measures presented by other reporting companies. We use EBITDA, as adjusted, to assist in evaluating our actual and expected operating and financial performance. The non-GAAP results should not be evaluated in isolation from, or as a substitute for, our financial results prepared in accordance with GAAP. A table reconciling our net income (loss), as reported, to EBITDA, as adjusted are included in the condensed consolidated financial statements in this release. We believe that using EBITDA and adjusted EBITDA together with net income (loss) will help investors better understand our underlying financial performance.
Navisite, LLC, a part of Spectrum Enterprise, is a leading international provider of enterprise-class, cloud-enabled hosting, managed applications and services. Navisite provides a full suite of reliable and scalable managed services, including Application, Cloud Desktop, Cloud Infrastructure and Hosting services for organizations looking to outsource IT infrastructures to help lower their capital and operational costs. Enterprise clients depend on Navisite for customized solutions, delivered through an international footprint of state-of-the-art data centres. For more information about Navisite services, please visit navisite.com or navisite.co.uk.