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PTGi Reports Growth in Revenue in First Quarter

May 11, 2012

Primus Telecommunications (News - Alert) Group, Incorporated (PTGi), a global facilities-based integrated provider of advanced telecommunications products and services, has reported that its net revenue for the first quarter 2012 was $234.7 million, an increase of 8.2 percent from first quarter 2011 net revenue of $217.0 million.

Contributing to the increase in net revenue was a 4.9 percent increase in net revenue from growth services (broadband, data center, SME VoIP, and other data services).

Total company data center revenue of $10.6 million increased 9.1 percent. Specifically, Primus Canada's data center revenue increased 10.1 percent to $8.2 million in the first quarter, while construction of the new 30,000 square foot Toronto Tier III facility accelerates toward a targeted third quarter grand opening.

Officials with Primus Telecommunications Group while announcing results for the first quarter ended March 31, 2012 pointed out that it completed the acquisition of Arbinet (News - Alert) Corporation on February 28, 2011; therefore, first quarter 2012 comparisons are not directly comparable with prior periods.

Company officials said that adjusted EBITDA was $20.0 million, an increase of 10.7 percent from first quarter 2011. The year-over-year impact of foreign exchange translation was an increase of $1.2 million to revenue for the first quarter 2012 and an increase of $0.3 million to Adjusted EBITDA.

According to company officials, free cash flow in the quarter was $9.9 million compared to Free Cash Flow of $9.6 million in first quarter 2011.

"PTGi's rapid pace of change is playing out in a two-pronged strategy, first, improving operations and focusing on profitable growth in high-ROI projects, such as our data center opportunity in Canada, and second, yielding a successful outcome of our strategic review. By the time of our first quarter report, we delivered on both fronts, and are very excited about the transformation of the new PTGi,” said Peter D. Aquino, chairman, president and chief executive officer, in a statement.

Aquino said that the pending sale of Primus Australia is a significant liquidity event and is a catalyst to create three separate operating segments going forward led by the company’s Canadian team: a 'pure play' data center business unit; a North American telecom unit focused on consumer, SME, and carrier voice and data services, including U.S. Retail; and the company’s ICS operation.

“This completes a portfolio of assets primarily located in North America. With the consolidation and realignment, we also expect corporate overhead annual run-rate savings of over $7 million, all part of a strategy to continue to deliver value to shareholders," he said.

Edited by Juliana Kenny