HERNDON, Va., March 16 /PRNewswire-FirstCall/ -- Arbinet
Corporation (Nasdaq: ARBX), a leading provider of
telecommunications services to fixed and mobile operators, today
reported financial results for the fourth quarter and full year
ended December 31, 2009.
Total revenues for fourth quarter 2009 of $82.5 million, included $74.8 million trading revenues and $7.7 million fee revenues, representing a 15.1%
and 25.8%, respectively, decrease from fourth quarter 2008.
Direct contribution from trading revenues (trading revenues
minus cost of trading revenues) for the fourth quarter 2009 was
$0.2 million compared with
($0.1) million in fourth quarter 2008
and $0.1 million in third quarter
2009. This improved contribution is primarily attributable to
the introduction of carrier services in late third quarter 2009. A
total of 2.5 billion minutes were bought and sold on Arbinet's
platform in the fourth quarter 2009, compared with 3.0 billion
minutes in the fourth quarter 2008 and 2.5 billion minutes in the
third quarter 2009. Arbinet completed 271.0 million calls
during the fourth quarter 2009, compared with 342.6 million calls
in the fourth quarter 2008 and 280.1 million calls in the third
quarter 2009.
Fourth quarter 2009 gross profit was $3.6
million compared with $5.8
million and $3.8 million for
the fourth quarter 2008 and third quarter 2009, respectively.
Fourth quarter 2009 loss from operations was ($3.9) million, compared with a loss from
operations of ($4.6) million in the
fourth quarter 2008. Fourth quarter 2009 results included
severance charges of $0.1 million and
a restructuring charge of $0.6
million related to the closing of the New Jersey office and relocation of corporate
headquarters to Virginia.
Comparatively, fourth quarter 2008 included a non-cash charge
of $3.0 million to record the
impairment of goodwill and other intangible assets.
The Company's loss from continuing operations in the fourth
quarter was ($3.7) million or
($0.16) per diluted share, compared
with a loss from continuing operations of ($9.1) million or ($0.39) per diluted share in the fourth quarter
2008. Fourth quarter 2009 results included a non-cash foreign
currency transaction gain of $0.2
million or $0.01 per diluted
share, compared with the fourth quarter 2008 non-cash foreign
currency exchange loss of ($4.6)
million or ($0.20) per diluted
share, representing the impact of currency fluctuations on U.S.
denominated obligations of the Company's United Kingdom subsidiary.
Total revenues for full year 2009 of $339.5 million, included $305.8 million trading revenues and $33.7 million fee revenues, representing
decreases of 26.9% and 30.3%, respectively, from full year 2008.
Direct contribution from trading revenues (trading revenues
minus cost of trading revenues) for full year 2009 was $0.1 million compared with ($0.4) million for full year 2008. This
improved contribution is primarily attributable to the introduction
of carrier services in late third quarter 2009. A total of
10.3 billion minutes were bought and sold on Arbinet's platform in
2009, compared with 13.2 billion minutes in 2008. Arbinet
completed 1,130.5 million calls during 2009, compared with 1,699.3
million calls in 2008. Average call duration was 4.5 minutes
in 2009 compared with 3.9 minutes in 2008.
For the full year 2009, gross profit was $15.6 million, down 44.6% compared with
$28.3 million in 2008. The
Company reported a loss from continuing operations of ($8.7) million or ($0.40) per diluted share for 2009, compared with
a loss from continuing operations of ($12.7)
million or ($0.53) per diluted
share in 2008.
In commenting on the Company's fourth quarter and full year 2009
results, Shawn O'Donnell, President and Chief Executive Officer of
Arbinet, stated, "We are encouraged by the fact that fourth quarter
revenues, gross profit and traffic volumes have stabilized and are
essentially flat with third quarter 2009. We believe the
actions we took over the past year to right size our cost structure
have positioned us well to weather the global economic downturn.
At the same time, we have made strategic investments in
growth that leverage our core capabilities. We are focused on
increasing the flexibility with which we work with the marketplace
and on training the sales force as we roll out new services.
In 2009 in order to expand our addressable market, we
designed, developed and launched carrier services, a standard
wholesale trading product, which is already gaining market traction
and continuing to contribute favorably to our performance in the
first quarter 2010. We believe that by continuing to expand
our product offerings to meet the increasingly complex demands of
our customers while closely managing our costs, we are well
positioned for long-term growth and profitability."
Conference Call
Arbinet will host a conference call to discuss its fourth
quarter and full year 2009 results at 10:00
a.m. Eastern Time today.
The dial-in number for the live audio call beginning at
10:00 a.m. Eastern Time (888)
562-3654, or (973) 582-2703 for international callers; the passcode
is 57749229. A live web cast of the conference call will be
available on Arbinet's web site at http://www.arbinet.com.
A replay of the conference call will be available from
1:00 p.m. Eastern Time on
March 16, 2010 through midnight Eastern Time on March 23, 2010 at http://www.arbinet.com and by
telephone at (800) 642-1687, or (706) 645-9291 for international
callers; the passcode is 57749229.
About Arbinet Corporation
Arbinet is a leading provider of international voice and IP
solutions to carriers and service providers globally. With more
than 1,100 carriers across the world utilizing the Arbinet network,
Arbinet combines global scale with sophisticated platform
intelligence, call routing and industry leading credit management
and settlement capabilities. Customers and suppliers include many
leading fixed line, mobile, wholesale and VoIP carriers as well as
calling card, ISPs and content providers around the world who buy
and sell voice and IP telecommunications capacity and content. The
Company can be reached at its corporate headquarters in
Herndon, VA at (703) 456-4100 or
by email at sales@arbinet.com.
Forward-Looking Statements
This press release contains forward-looking statements,
including forward-looking statements regarding anticipated future
revenues, growth, capital expenditures, management's future
expansion plans, expected product and service developments or
enhancements, and future operating results. Such
forward-looking statements may be identified by, among other
things, the use of forward-looking terminology such as: "believes,"
"expects," "intends," "may," "will," "should," "confident," "work
to," "seeks," or "anticipates," or the negative thereof or other
variations thereon or comparable terminology, or by discussions of
strategy that involve risks and uncertainties. Various
important risks and uncertainties may cause our actual results to
differ materially from the results indicated by these
forward-looking statements, including, without limitation: members
(in particular, significant trading members) not trading on the
Exchange or utilizing our new and additional services, including
our carrier services; continued volatility in the volume and mix of
trading activity; our uncertain and long member enrollment cycle;
failure to manage our credit risk; failure to manage our growth and
implement our business plan; pricing pressure; currency
fluctuations; investments in our management team and personnel;
disruption or uncertainty resulting from recent changes in senior
management; regulatory uncertainty; system failures, human error
and security breaches that could cause us to lose members and
customers and expose us to liability; our ability to obtain and
enforce patent protection for our methods and technologies; losses
in efficiency due to cost cutting and restructuring initiatives;
decreased trading volumes due to our efforts to increase call
quality on the Exchange; and economic conditions and volatility of
financial markets, decreased availability of credit to us or buyers
on the Exchange, and the impact they may have on us, our members
and customers, and demand for our services. For a further list and
description of the risks and uncertainties the Company faces,
please refer to our most recent Annual Report on Form 10-K and
other periodic and current filings that have been filed with the
Securities and Exchange Commission and are available at
www.sec.gov. Such forward-looking statements are current only
as of the date they are made, and we assume no obligation to update
any forward-looking statements, whether as a result of new
information, future events or otherwise.
Contacts:
Gary Brandt,
CFO
Arbinet
Corporation
703-456-4140
Andrea Priest / Andi
Salas
Joele Frank,
Wilkinson Brimmer Katcher
212-355-4449
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ARBINET CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
------------------ ------------
2009 2008 2009 2008
---- ---- ---- ----
Trading revenues $74,773 $88,092 $305,792 $418,492
Fee revenues 7,683 10,353 33,684 48,356
Total revenues 82,456 98,445 339,476 466,848
Cost of trading revenues 74,526 88,194 305,696 418,890
Indirect cost of trading and
fee revenues 4,289 4,439 18,132 19,698
Total cost of trading and
fee revenues 78,815 92,633 323,828 438,588
------ ------ ------- -------
Gross profit 3,641 5,812 15,648 28,260
Other operating expenses:
Sales and marketing 1,904 2,011 7,566 10,211
General and administrative 3,173 3,384 10,685 11,677
Depreciation and amortization 1,747 1,864 7,147 7,501
Severance charges 109 145 470 1,422
Restructuring and other exit
costs 629 629
Impairment charge - 2,966 - 3,442
Total other operating
expenses 7,562 10,370 26,497 34,253
----- ------ ------ ------
Loss from operations (3,921) (4,558) (10,849) (5,993)
Interest income 15 124 122 948
Interest expense (106) (135) (626) (577)
Foreign currency transaction
gain (loss) 250 (4,583) 2,331 (6,978)
Other income, net 84 75 321 287
Loss from continuing
operations before income taxes (3,678) (9,077) (8,701) (12,313)
(Benefit) provision for
income taxes (236) (119) (39) 392
---- ---- --- ---
Net loss from continuing
operations (3,442) (8,958) (8,662) (12,705)
Loss from discontinued
operations, net of income tax - (99) - (2,228)
Net loss $(3,442) $(9,057) $(8,662) $(14,933)
======= ======= ======= ========
Basic and diluted net loss
per common share:
Continuing operations $(0.16) $(0.39) $(0.40) $(0.53)
Discontinued operations (0.01) (0.09)
Net loss $(0.16) $(0.40) $(0.40) $(0.62)
====== ====== ====== ======
Weighted average shares used
in computing basic and diluted
net loss per share 21,771 22,758 21,840 23,922
ARBINET CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
(unaudited)
As of As of
December 31, December 31,
2009 2008
------------- -------------
Assets
Current Assets:
Cash and cash equivalents $15,492 $16,224
Marketable securities 6,407 7,926
Trade accounts receivable, net of allowance 24,513 28,176
Prepaids and other current assets 1,284 3,476
----- -----
Total current assets 47,696 55,802
Property and equipment, net 17,821 20,868
Security deposits 1,676 2,130
Intangible assets, net 149 163
Other assets 395 395
Total Assets $67,737 $79,358
======= =======
Liabilities and Stockholders' Equity
Current Liabilities:
Due to Silicon Valley Bank $2,014 $371
Accounts payable 11,676 12,924
Deferred revenue 1,434 2,770
Accrued expenses and other current
liabilities 6,172 7,552
Current portion of long-term debt 3,600 -
Current liabilities for
discontinued operations 100 473
--- ---
Total current liabilities 24,996 24,090
Long-term debt - 3,600
Deferred rent 2,343 1,862
Other long-term liabilities 66 61
--- ---
Total Liabilities 27,405 29,613
------ ------
Stockholders' Equity
Common stock 27 27
Additional paid-In Capital 175,906 173,867
Treasury stock (17,122) (15,852)
Accumulated other comprehensive gain 2,056 3,576
Accumulated deficit (120,535) (111,873)
-------- --------
Total Stockholders' Equity 40,332 49,745
Total Liabilities and
Stockholders' Equity $67,737 $79,358
======= =======
SOURCE Arbinet Corporation