WASHINGTON, Aug. 6, 2020 /PRNewswire/ --
Financial and Business Highlights
- Cogent approved an increase of $0.025 per share to its regular quarterly
dividend for a total of $0.705 per
share for Q3 2020 as compared to $0.68 per share for Q2 2020 – Cogent's
thirty-second consecutive quarterly dividend increase and a greater
increase than the $0.02 per share
increase in Q2 2020.
-
- The Q3 2020 $0.705 dividend per
share represents an annual increase of 13.7% from the dividend per
share of $0.62 for Q3 2019.
- Service revenue, on a constant currency basis, increased by
0.2% from Q1 2020 to Q2 2020 and increased from Q2 2019 to Q2 2020
by 5.1%.
-
- Service revenue increased by 0.1% from Q1 2020 to Q2 2020 and
increased from Q2 2019 to Q2 2020 by 4.6%.
- GAAP gross profit increased by 11.3% from Q2 2019 to
$67.2 million for Q2 2020. Non-GAAP
gross profit increased by 8.4% from Q2 2019 to $87.4 million for Q2 2020.
-
- GAAP gross margin increased by 290 basis points from Q2 2019 to
Q2 2020 to 47.7%. Non-GAAP gross margin increased by 220 basis
points from Q2 2019 to Q2 2020 to 62.0%.
- Net cash provided by operating activities increased by 45.2%
from Q1 2020 to $41.3 million for Q2
2020 and increased by 1.7% from Q2 2019.
- EBITDA increased by 5.9% from Q1 2020 to $53.3 million for Q2 2020 and increased by 13.3%
from Q2 2019.
-
- EBITDA margin increased by 200 basis points from Q1 2020 to
37.8% for Q2 2020 and increased by 290 basis points from Q2
2019.
- Cogent issued €215 million of Senior Euro Notes due in 2024 in
June for net proceeds of $240.3
million. The net proceeds were used to redeem and extinguish
its $189.2 million of Senior Notes
due in 2021 at par and to provide cash for general corporate
purposes including to dividend cash from its operating companies to
Cogent Holdings, Inc.
Cogent Communications Holdings, Inc. (NASDAQ: CCOI) ("Cogent")
today announced service revenue of $141.0
million for the three months ended June 30, 2020, an increase of 0.1% from the three
months ended March 31, 2020 and an
increase of 4.6% from the three months ended June 30, 2019. Foreign exchange negatively
impacted service revenue growth from the three months ended
March 31, 2020 to the three months
ended June 30, 2020 by $0.2 million and negatively impacted service
revenue growth from the three months ended June 30, 2019 to the three months ended
June 30, 2020 by $0.7 million. On a constant currency basis,
service revenue grew by 0.2% from the three months ended
March 31, 2020 to the three months
ended June 30, 2020 and grew by 5.1%
from the three months ended June 30,
2019 to the three months ended June
30, 2020. Excise taxes, including Universal Service Fund
fees, recorded on a gross basis and included in service revenue and
cost of network operations expense were $3.3
million for the three months ended June 30, 2020, $3.2
million for the three months ended June 30, 2019 and $3.7
million for the three months ended March 31, 2020.
On-net service is provided to customers located in buildings
that are physically connected to Cogent's network by Cogent
facilities. On-net revenue was $103.8
million for the three months ended June 30, 2020; an increase of 0.3% from the three
months ended March 31, 2020 and an
increase of 6.5% over the three months ended June 30, 2019.
Off-net customers are located in buildings directly connected to
Cogent's network using other carriers' facilities and services to
provide the last mile portion of the link from the customers'
premises to Cogent's network. Off-net revenue was $37.0 million for the three months ended
June 30, 2020; a decrease of 0.7%
over the three months ended March 31,
2020 and a decrease of 0.4% over the three months ended
June 30, 2019.
GAAP gross profit is defined as total service revenue less
network operations expense, depreciation and amortization and
equity based compensation included in network operations
expense. GAAP gross margin is defined as GAAP gross profit
divided by total service revenue. GAAP gross profit increased by
11.3% from the three months ended June 30,
2019 to $67.2 million for the
three months ended June 30, 2020 and
increased by 2.6% from the three months ended March 31, 2020. GAAP gross margin was 47.7% for
the three months ended June 30, 2020,
44.8% for the three months ended June 30,
2019 and 46.5% for the three months ended March 31, 2020. Excise taxes, including Universal
Service Fund fees, recorded on a gross basis and included in
service revenue and cost of network operations expense were
$3.3 million for the three months
ended June 30, 2020, $3.2 million for the three months ended
June 30, 2019 and $3.7 million for the three months ended
March 31, 2020.
Non-GAAP gross profit represents service revenue less network
operations expense, excluding equity-based compensation and amounts
shown separately (depreciation and amortization expense). Non-GAAP
gross margin is defined as Non-GAAP gross profit divided by total
service revenue. Non-GAAP gross profit increased by 8.4% from
the three months ended June 30, 2019
to $87.4 million for the three months
ended June 30, 2020 and increased by
2.5% from the three months ended March 31,
2020. Non-GAAP gross profit margin was 62.0% for the three
months ended June 30, 2020, 59.8% for
the three months ended June 30, 2019
and 60.5% for the three months ended March
31, 2020.
Net cash provided by operating activities increased by 1.7% from
the three months ended June 30, 2019
to $41.3 million for the three months
ended June 30, 2020 and increased by
45.2% from the three months ended March 31,
2020.
Earnings before interest, taxes, depreciation and amortization
(EBITDA) increased by 13.3% from the three months ended
June 30, 2019 to $53.3 million for the three months ended
June 30, 2020 and increased by 5.9%
from the three months ended March 31,
2020. EBITDA margin was 37.8% for the three months ended
June 30, 2020, 34.9% for the three
months ended June 30, 2019 and 35.8%
for the three months ended March 31,
2020.
EBITDA, as adjusted, increased by 13.2% from the three months
ended June 30, 2019 to $53.6 million for the three months ended
June 30, 2020 and increased by 6.2%
from the three months ended March 31,
2020. EBITDA, as adjusted, margin was 38.0% for the three
months ended June 30, 2020, 35.1% for
the three months ended June 30, 2019
and 35.8% for the three months ended March
31, 2020.
Basic net income per share was $0.19 for the three months ended June 30, 2020, $0.16 for the three months ended June 30, 2019 and $0.20 for the three months ended March 31, 2020. Diluted net income per share was
$0.18 for the three months ended
June 30, 2020, $0.16 for the three months ended June 30, 2019 and $0.20 for the three months ended March 31, 2020.
Unrealized foreign exchange (losses) gains on Cogent's 2024
Senior Euro Notes were $(3.4)
million for the three months ended June 30, 2020, $0.2
million for the three months ended June 30, 2019 and $2.9
million for the three months ended March 31, 2020. Cogent realized a $2.5 million foreign exchange gain related to the
issuance of its €215 million of 2024 Senior Euro Notes in the
three months ended June 30, 2020.
Total customer connections increased by 4.8% from June 30, 2019 to 88,112 as of June 30, 2020 and increased by 1.0% from
March 31, 2020. On-net customer
connections increased by 4.8% from June 30,
2019 to 75,927 as of June 30,
2020 and increased by 1.0% from March
31, 2020. Off-net customer connections increased by 4.6%
from June 30, 2019 to 11,846 as of
June 30, 2020 and increased by 1.1%
from March 31, 2020.
The number of on-net buildings increased by 117 buildings from
June 30, 2019 to 2,854 on-net
buildings as of June 30, 2020 and
increased by 31 on-net buildings from March
31, 2020.
Quarterly Dividend Increase Approved
On August 5, 2020, the Board
approved a regular quarterly dividend of $0.705 per common share payable on
September 4, 2020 to shareholders of
record on August 21, 2020. This third
quarter 2020 regular dividend represents a 3.7% increase of
$0.025 per share from the second
quarter 2020 regular dividend of $0.68 per share and an annual increase of 13.7%
from the Q3 2019 dividend of $0.62
per share.
The payment of any future dividends and any other returns of
capital will be at the discretion of the Board and may be reduced,
eliminated or increased and will be dependent upon Cogent's
financial position, results of operations, available cash, cash
flow, capital requirements, limitations under Cogent's debt
indenture agreements and other factors deemed relevant by the
Board.
Impact of COVID-19
Cogent continues to be impacted by the COVID-19 pandemic and the
accompanying responses by governments around the world.
Cogent's entire workforce continues to work remotely with
dedication. During the second quarter of 2020, the impact of
the COVID-19 pandemic on Cogent's business remained limited.
Cogent experienced a decrease in sales productivity, particularly
in sales to its corporate customers. Traffic on the Cogent
network continued to grow at an accelerated rate compared to
Cogent's historical growth rates. However, the traffic growth rate
for the second quarter of 2020 was slower than the traffic growth
rate at the end of the first quarter of 2020.
The ongoing impact of the COVID-19 pandemic and related
government restrictions on Cogent's business is unknown as a
significant amount of uncertainty and volatility
remains. Cogent does not know the scope and duration of
the pandemic, what actions governments may take in the future in
response to the pandemic and what the impact will be on the
economies of the world. While Cogent's workforce is working
remotely, Cogent provides no assurance that this will be sufficient
to protect its workforce or its key employees. Moreover,
Cogent's results of operations may be adversely affected in the
future as the pandemic and the related government restrictions
continue. Cogent may also experience slowdowns in new
customer orders, find it difficult to collect from customers who
are experiencing financial distress, encounter difficulties
accessing the buildings and locations where Cogent installs new
services and serves existing customers, or have difficulties
procuring, shipping or installing necessary equipment on its
network. Cogent may also find that its largest customer base,
which is served primarily in its multi-tenant office buildings, may
be adversely affected by falling demand for commercial office space
in central business districts as companies located in these
buildings elect not to return to their office space either on a
temporary or even permanent basis. In addition,
Cogent's corporate customer base may reduce their overall number of
locations due to adverse economic conditions or new working
configurations which may adversely affect Cogent's number of
corporate connections and service revenues. As a result, the
global economic impact of the COVID-19 pandemic may have prolonged
effects that impact Cogent's business well into the future.
These and other risks will be described in more detail in Cogent's
Quarterly Report on Form 10-Q for the quarter ended June 30, 2020 and are set forth in its annual
report on Form 10-K for the year ended December 31, 2019 and its Quarterly Report on
Form 10-Q for the quarter ended March 31,
2020.
Conference Call and Website Information
Cogent will host a conference call with financial analysts at
8:00 a.m. (ET) on August 6, 2020 to discuss Cogent's operating
results for the second quarter of 2020 and to discuss Cogent's
expectations for full year 2020. Investors and other interested
parties may access a live audio webcast of the earnings call in the
"Events" section of Cogent's website at www.cogentco.com/events. A
replay of the webcast, together with the press release, will be
available on the website following the earnings call.
About Cogent Communications
Cogent Communications (NASDAQ: CCOI) is a multinational, Tier 1
facilities-based ISP. Cogent specializes in providing
businesses with high-speed Internet access, Ethernet transport, and
colocation services. Cogent's facilities-based, all-optical IP
network backbone provides services in over 200 markets
globally.
Cogent Communications is headquartered at 2450 N Street, NW,
Washington, D.C. 20037. For more
information, visit www.cogentco.com. Cogent Communications can be
reached in the United States at
(202) 295-4200 or via email at info@cogentco.com.
|
COGENT
COMMUNICATIONS HOLDINGS, INC., AND SUBSIDIARIES
Summary of Financial and Operational Results
|
|
Q1
2019
|
Q2
2019
|
Q3
2019
|
Q4
2019
|
Q1
2020
|
Q2
2020
|
|
Metric ($ in
000's, except share and per share data) – unaudited
|
|
|
|
|
|
|
|
On-Net
revenue
|
$97,183
|
$97,472
|
$99,416
|
$102,683
|
$103,457
|
$103,800
|
|
%
Change from previous Qtr.
|
1.9%
|
0.3%
|
2.0%
|
3.3%
|
0.8%
|
0.3%
|
|
Off-Net
revenue
|
$36,843
|
$37,191
|
$37,418
|
$37,479
|
$37,321
|
$37,044
|
|
%
Change from previous Qtr.
|
0.8%
|
0.9%
|
0.6%
|
0.2%
|
-0.4%
|
-0.7%
|
|
Non-Core revenue
(1)
|
$111
|
$126
|
$108
|
$130
|
$137
|
$146
|
|
%
Change from previous Qtr.
|
-24.5%
|
13.5%
|
-14.3%
|
20.4%
|
5.4%
|
6.6%
|
|
Service revenue –
total
|
$134,137
|
$134,789
|
$136,942
|
$140,292
|
$140,915
|
$140,990
|
|
%
Change from previous Qtr.
|
1.6%
|
0.5%
|
1.6%
|
2.4%
|
0.4%
|
0.1%
|
|
Constant currency
total revenue quarterly growth rate – sequential quarters
(6)
|
1.7%
|
0.7%
|
1.7%
|
2.5%
|
0.6%
|
0.2%
|
|
Constant currency
total revenue quarterly growth rate – year over year quarters
(6)
|
5.8%
|
5.4%
|
6.0%
|
6.8%
|
5.6%
|
5.1%
|
|
Excise Taxes
included in service revenue
|
$3,391
|
$3,191
|
$3,998
|
$4,334
|
$3,743
|
$3,298
|
|
%
Change from previous Qtr.
|
4.9%
|
-5.9%
|
25.3%
|
8.4%
|
-13.6%
|
-11.9%
|
|
Network operations
expenses (2)
|
$53,970
|
$54,181
|
$54,971
|
$55,684
|
$55,669
|
$53,581
|
|
%
Change from previous Qtr.
|
-2.6%
|
0.4%
|
1.5%
|
1.3%
|
-%
|
-3.8%
|
|
GAAP gross profit
(3)
|
$59,724
|
$60,403
|
$61,683
|
$64,300
|
$65,486
|
$67,208
|
|
%
Change from previous Qtr.
|
7.7%
|
1.1%
|
2.1%
|
4.2%
|
1.8%
|
2.6%
|
|
GAAP gross margin
(3)
|
44.5%
|
44.8%
|
45.0%
|
45.8%
|
46.5%
|
47.7%
|
|
Non-GAAP gross
profit (4) (6)
|
$80,167
|
$80,608
|
$81,971
|
$84,608
|
$85,246
|
$87,409
|
|
%
Change from previous Qtr.
|
4.6%
|
0.6%
|
1.7%
|
3.2%
|
0.8%
|
2.5%
|
|
Non-GAAP gross
margin (4) (6)
|
59.8%
|
59.8%
|
59.9%
|
60.3%
|
60.5%
|
62.0%
|
|
Selling, general
and administrative expenses (5)
|
$32,568
|
$33,503
|
$31,456
|
$31,884
|
$34,852
|
$34,061
|
|
%
Change from previous Qtr.
|
12.2%
|
2.9%
|
-6.1%
|
1.4%
|
9.3%
|
-2.3%
|
|
Depreciation and
amortization expense
|
$20,263
|
$19,979
|
$20,006
|
$20,002
|
$19,508
|
$19,896
|
|
%
Change from previous Qtr.
|
-3.3%
|
-1.4%
|
0.1%
|
-%
|
-2.5%
|
2.0%
|
|
Equity-based
compensation expense
|
$3,434
|
$5,289
|
$4,797
|
$4,940
|
$5,075
|
$6,083
|
|
%
Change from previous Qtr.
|
-22.1%
|
54.0%
|
-9.3%
|
3.0%
|
2.7%
|
19.9%
|
|
Operating
income
|
$24,400
|
$22,022
|
$25,799
|
$28,033
|
$25,850
|
$27,574
|
|
%
Change from previous Qtr.
|
9.4%
|
-9.7%
|
17.2%
|
8.7%
|
-7.8%
|
6.7%
|
|
Interest
expense
|
$13,456
|
$13,595
|
$15,191
|
$15,211
|
$15,220
|
$15,499
|
|
%
Change from previous Qtr.
|
-0.4%
|
1.0%
|
11.7%
|
0.1%
|
0.1%
|
1.8%
|
|
Net
income
|
$9,217
|
$7,136
|
$13,701
|
$7,465
|
$9,227
|
$8,564
|
|
Realized and
unrealized gains (losses) on 2024 euro notes
|
$-
|
$177
|
$6,128
|
$(4,032)
|
$2,908
|
$(873)
|
|
Basic net income
per common share
|
$0.20
|
$0.16
|
$0.30
|
$0.16
|
$0.20
|
$0.19
|
|
Diluted net income
per common share
|
$0.20
|
$0.16
|
$0.30
|
$0.16
|
$0.20
|
$0.18
|
|
Weighted average
common shares – basic
|
45,223,157
|
45,354,327
|
45,438,656
|
45,553,727
|
45,658,565
|
45,754,880
|
|
%
Change from previous Qtr.
|
-0.1%
|
0.3%
|
0.2%
|
0.3%
|
0.2%
|
0.2%
|
|
Weighted average
common shares – diluted
|
45,644,236
|
45,912,291
|
46,019,691
|
46,145,970
|
46,391,066
|
46,686,665
|
|
%
Change from previous Qtr.
|
-0.3%
|
0.6%
|
0.2%
|
0.3%
|
0.5%
|
0.6%
|
|
EBITDA
(6)
|
$47,561
|
$47,105
|
$50,515
|
$52,724
|
$50,394
|
$53,348
|
|
%
Change from previous Qtr.
|
-%
|
-1.0%
|
7.2%
|
4.4%
|
-4.4%
|
5.9%
|
|
EBITDA
margin
|
35.5%
|
34.9%
|
36.9%
|
37.6%
|
35.8%
|
37.8%
|
|
Gains on asset
related transactions
|
$536
|
$185
|
$87
|
$251
|
$39
|
$205
|
|
EBITDA, as
adjusted (6)
|
$48,097
|
$47,290
|
$50,602
|
$52,975
|
$50,433
|
$53,553
|
|
%
Change from previous Qtr.
|
0.9%
|
-1.7%
|
7.0%
|
4.7%
|
-4.8%
|
6.2%
|
|
EBITDA, as
adjusted, margin
|
35.9%
|
35.1%
|
37.0%
|
37.8%
|
35.8%
|
38.0%
|
|
Net cash provided
by operating activities
|
$28,637
|
$40,632
|
$33,443
|
$46,097
|
$28,458
|
$41,311
|
|
%
Change from previous Qtr.
|
-29.7%
|
41.9%
|
-17.7%
|
37.8%
|
-38.3%
|
45.2%
|
|
Capital
expenditures
|
$13,288
|
$11,720
|
$12,051
|
$9,899
|
$12,866
|
$13,930
|
|
% Change from previous Qtr.
|
21.5%
|
-11.8%
|
2.8%
|
-17.9%
|
30.0%
|
8.3%
|
|
Principal payments
of capital (finance) lease obligations
|
$3,030
|
$1,976
|
$2,029
|
$2,056
|
$6,167
|
$3,716
|
|
% Change from previous Qtr.
|
42.4%
|
-34.8%
|
2.7%
|
1.3%
|
200.0%
|
-39.7%
|
|
Dividends
paid
|
$26,565
|
$27,741
|
$28,565
|
$29,776
|
$30,557
|
$31,738
|
|
Purchases of
common stock
|
$ -
|
$ -
|
$ -
|
$ -
|
$ -
|
$-
|
|
Gross Leverage
Ratio
|
4.28
|
5.08
|
4.97
|
4.86
|
4.78
|
5.08
|
|
Net Leverage
Ratio
|
2.92
|
2.93
|
2.92
|
2.86
|
2.92
|
3.07
|
|
Customer
Connections – end of period
|
|
|
|
|
|
|
|
On-Net
|
71,066
|
72,415
|
73,870
|
74,554
|
75,163
|
75,927
|
|
%
Change from previous Qtr.
|
3.3%
|
1.9%
|
2.0%
|
0.9%
|
0.8%
|
1.0%
|
|
Off-Net
|
11,138
|
11,321
|
11,503
|
11,660
|
11,721
|
11,846
|
|
%
Change from previous Qtr.
|
1.5%
|
1.6%
|
1.6%
|
1.4%
|
0.5%
|
1.1%
|
|
Non-Core
(1)
|
318
|
318
|
319
|
325
|
329
|
339
|
|
%
Change from previous Qtr.
|
-12.2%
|
-%
|
-0.3%
|
1.9%
|
1.2%
|
3.0%
|
|
Total customer
connections
|
82,522
|
84,054
|
85,692
|
86,539
|
87,213
|
88,112
|
|
%
Change from previous Qtr.
|
3.0%
|
1.9%
|
1.9%
|
1.0%
|
0.8%
|
1.0%
|
|
On-Net Buildings –
end of period
|
|
|
|
|
|
|
|
Multi-Tenant office
buildings
|
1,746
|
1,751
|
1,757
|
1,767
|
1,769
|
1,771
|
|
Carrier neutral data
center buildings
|
908
|
933
|
960
|
980
|
1,000
|
1,029
|
|
Cogent data
centers
|
52
|
53
|
54
|
54
|
54
|
54
|
|
Total on-net
buildings
|
2,706
|
2,737
|
2,771
|
2,801
|
2,823
|
2,854
|
|
Square feet –
multi-tenant office buildings – on-net
|
949,486,923
|
951,031,709
|
954,013,024
|
957,173,183
|
961,154,384
|
962,049,183
|
|
Network –
end of period
|
|
|
|
|
|
|
|
Intercity route
miles
|
57,426
|
57,426
|
57,426
|
57,600
|
58,009
|
58,009
|
|
Metro fiber
miles
|
33,664
|
34,163
|
34,985
|
35,526
|
36,079
|
36,438
|
|
Connected networks –
AS's
|
6,668
|
6,762
|
6,844
|
6,954
|
7,042
|
7,133
|
|
Headcount – end of
period
|
|
|
|
|
|
|
|
Sales force – quota
bearing
|
501
|
519
|
530
|
548
|
542
|
572
|
|
Sales force -
total
|
639
|
656
|
667
|
686
|
684
|
716
|
|
Total
employees
|
997
|
1,026
|
1,036
|
1,055
|
1,052
|
1,083
|
|
Sales rep
productivity – units per full time equivalent sales rep ("FTE") per
month
|
5.1
|
4.9
|
4.4
|
4.1
|
4.5
|
4.0
|
|
FTE – sales
reps
|
464
|
478
|
488
|
502
|
522
|
533
|
|
|
|
(1)
|
Consists of legacy
services of companies whose assets or businesses were acquired by
Cogent, primarily including voice services (only provided in
Toronto, Canada).
|
|
(2)
|
Network operations
expense excludes equity-based compensation expense of $180, $226,
$282, $306, $252 and $305 in the three month periods ended March
31, 2019 through June 30, 2020, respectively. Network
operations expense includes excise taxes, including Universal
Service Fund fees of $3,391, $3,191, $3,998, $4,334, $3,743 and
$3,298 in the three month periods ended March 31, 2019 through June
30, 2020, respectively.
|
|
(3)
|
GAAP gross profit is
defined as total service revenue less network operations expense,
depreciation and amortization and equity based compensation
included in network operations expense. GAAP gross margin is
defined as GAAP gross profit divided by total service
revenue.
|
|
(4)
|
Non-GAAP gross profit
represents service revenue less network operations expense,
excluding equity-based compensation and amounts shown separately
(depreciation and amortization expense). Non-GAAP gross margin is
defined as non-GAAP gross profit divided by total service
revenue. Management believes that non-GAAP gross profit and
non-GAAP gross profit margin are relevant metrics to provide
investors, as they are metrics that management uses to measure the
margin available to the company after network service costs, in
essence a measure of the efficiency of the Company's
network.
|
|
(5)
|
Excludes equity-based
compensation expense of $3,254, $5,063, $4,515, $4,634, $4,823 and
$5,778 in the three month periods ended March 31, 2019 through June
30, 2020, respectively.
|
|
(6)
|
See Schedules of
Non-GAAP measures below for definitions and reconciliations to GAAP
measures.
|
Schedules of Non-GAAP Measures
EBITDA and EBITDA,
as adjusted
EBITDA represents net cash flows provided by operating
activities plus changes in operating assets and liabilities, cash
interest expense and cash income tax expense. Management
believes the most directly comparable measure to EBITDA calculated
in accordance with generally accepted accounting principles in
the United States, or GAAP, is net
cash provided by operating activities. The Company also believes
that EBITDA is a measure frequently used by securities analysts,
investors, and other interested parties in their evaluation of
issuers. EBITDA, as adjusted, represents EBITDA plus net
gains (losses) on asset related transactions.
The Company believes that EBITDA, and EBITDA, as adjusted, are
useful measures of its ability to service debt, fund capital
expenditures and expand its business. EBITDA, and EBITDA, as
adjusted are an integral part of the internal reporting and
planning system used by management as a supplement to GAAP
financial information. EBITDA, and EBITDA, as adjusted are not
recognized terms under GAAP and accordingly, should not be viewed
in isolation or as a substitute for the analysis of results as
reported under GAAP, but rather as a supplemental measure to GAAP.
For example, these metrics are not intended to reflect the
Company's free cash flow, as it does not consider certain current
or future cash requirements, such as capital expenditures,
contractual commitments, and changes in working capital needs,
interest expenses and debt service requirements. The Company's
calculations of these metrics may also differ from the calculations
performed by its competitors and other companies and as such, its
utility as a comparative measure is limited.
EBITDA, and EBITDA, as adjusted, are reconciled to net cash
provided by operating activities in the table below.
|
Q1
2019
|
Q2
2019
|
Q3
2019
|
Q4
2019
|
Q1
2020
|
Q2
2020
|
|
($ in 000's) –
unaudited
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
$28,637
|
$40,632
|
$33,443
|
$46,097
|
$28,458
|
$41,311
|
|
Changes in operating
assets and liabilities
|
6,727
|
(5,729)
|
3,785
|
(6,557)
|
5,325
|
$(3,232)
|
|
Cash interest expense
and income tax expense
|
12,197
|
12,202
|
13,287
|
13,184
|
16,611
|
15,269
|
|
EBITDA
|
$47,561
|
$47,105
|
$50,515
|
$52,724
|
$50,394
|
$53,348
|
|
PLUS: Gains on asset
related transactions
|
536
|
185
|
87
|
251
|
39
|
205
|
|
EBITDA, as
adjusted
|
$48,097
|
$47,290
|
$50,602
|
$52,975
|
$50,433
|
$53,553
|
|
EBITDA
margin
|
35.5%
|
34.9%
|
36.9%
|
37.6%
|
35.8%
|
37.8%
|
|
EBITDA, as
adjusted, margin
|
35.9%
|
35.1%
|
37.0%
|
37.8%
|
35.8%
|
38.0%
|
Constant currency revenue is reconciled to service revenue as
reported in the tables below.
Constant currency impact on revenue changes – sequential
periods
|
($ in 000's) –
unaudited
|
Q1
2019
|
Q2
2019
|
Q3
2019
|
Q4
2019
|
Q1
2020
|
Q2
2020
|
|
Service revenue, as
reported – current period
|
$134,137
|
$134,789
|
$136,942
|
$140,292
|
$140,915
|
$140,990
|
|
Impact of foreign
currencies on service revenue
|
135
|
260
|
176
|
88
|
184
|
202
|
|
Service revenue - as
adjusted for currency impact (1)
|
$134,272
|
$135,049
|
$137,118
|
$140,380
|
$141,099
|
$141,192
|
|
Service revenue, as
reported – prior sequential period
|
$132,049
|
$134,137
|
$134,789
|
$136,942
|
$140,292
|
$140,915
|
|
Constant currency
increase
|
$2,223
|
$912
|
$2,329
|
$3,438
|
$807
|
$277
|
|
Constant currency
percent increase
|
1.7%
|
0.7%
|
1.7%
|
2.5%
|
0.6%
|
0.2%
|
|
|
|
(1)
|
Service revenue, as
adjusted for currency impact, is determined by translating the
service revenue for the current period at the average foreign
currency exchange rates for the prior sequential period. The
Company believes that disclosing quarterly sequential revenue
growth without the impact of foreign currencies on service revenue
is a useful measure of sequential revenue growth. Service revenue,
as adjusted for currency impact, is an integral part of the
internal reporting and planning system used by management as a
supplement to GAAP financial information.
|
Constant currency impact on revenue changes – prior year
periods
|
($ in 000's) –
unaudited
|
Q1
2019
|
Q2
2019
|
Q3
2019
|
Q4
2019
|
Q1
2020
|
Q2
2020
|
|
Service revenue, as
reported – current period
|
$134,137
|
$134,789
|
$136,942
|
$140,292
|
$140,915
|
$140,990
|
|
Impact of foreign
currencies on service revenue
|
2,078
|
1,505
|
1,058
|
683
|
746
|
674
|
|
Service revenue - as
adjusted for currency impact (2)
|
$136,215
|
$136,294
|
$138,000
|
$140,975
|
$141,661
|
$141,664
|
|
Service revenue, as
reported – prior year period
|
$128,706
|
$129,296
|
$130,139
|
$132,049
|
$134,137
|
$134,789
|
|
Constant currency
increase
|
$7,509
|
$6,998
|
$7,861
|
$8,926
|
$7,524
|
$6,875
|
|
Percent
increase
|
5.8%
|
5.4%
|
6.0%
|
6.8%
|
5.6%
|
5.1%
|
|
|
|
(2)
|
Service revenue, as
adjusted for currency impact, is determined by translating the
service revenue for the current period at the average foreign
currency exchange rates for the comparable prior year period. The
Company believes that disclosing year over year revenue growth
without the impact of foreign currencies on service revenue is a
useful measure of revenue growth. Service revenue, as adjusted for
currency impact, is an integral part of the internal reporting and
planning system used by management as a supplement to GAAP
financial information.
|
Non-GAAP gross profit and Non-GAAP gross margin
Non-GAAP gross profit and Non-GAAP gross margin are
reconciled to GAAP gross profit and GAAP gross margin in the table
below.
|
Q1
2019
|
Q2
2019
|
Q3
2019
|
Q4
2019
|
Q1
2020
|
Q2
2020
|
|
($ in 000's) –
unaudited
|
|
|
|
|
|
|
|
Service revenue
total
|
$134,137
|
$134,789
|
$136,942
|
$140,292
|
$140,915
|
$140,990
|
|
Minus - Network
operations expense including equity-based compensation and
including depreciation and amortization expense
|
74,413
|
74,386
|
75,259
|
75,992
|
75,429
|
73,782
|
|
GAAP Gross Profit
(1)
|
$59,724
|
$60,403
|
$61,683
|
$64,300
|
$65,486
|
$67,208
|
|
Plus -
Equity-based compensation – network operations expense
|
180
|
226
|
282
|
306
|
252
|
305
|
|
Plus – Depreciation
and amortization expense
|
20,263
|
19,979
|
20,006
|
20,002
|
19,508
|
19,896
|
|
Non-GAAP Gross
Profit (2)
|
$80,167
|
$80,608
|
$81,971
|
$84,608
|
$85,246
|
$87,409
|
|
GAAP Gross Margin
(1)
|
44.5%
|
44.8%
|
45.0%
|
45.8%
|
46.5%
|
47.7%
|
|
Non-GAAP Gross
Margin (2)
|
59.8%
|
59.8%
|
59.9%
|
60.3%
|
60.5%
|
62.0%
|
|
|
|
(1)
|
GAAP gross profit is
defined as total service revenue less network operations expense,
depreciation and amortization and equity based compensation
included in network operations expense. GAAP gross margin is
defined as GAAP gross profit divided by total service
revenue.
|
|
(2)
|
Non-GAAP gross profit
represents service revenue less network operations expense,
excluding equity based compensation and amounts shown separately
(depreciation and amortization expense). Non-GAAP gross margin is
defined as non-GAAP gross profit divided by total service
revenue. Management believes that non-GAAP gross profit and
non-GAAP gross margin are relevant metrics to provide to investors,
as they are metrics that management uses to measure the margin and
amount available to the Company after network service costs, in
essence these are measures of the efficiency of the Company's
network.
|
Gross and Net Leverage Ratios
Gross leverage ratio is defined as total debt divided by the
trailing last 12 months EBITDA, as adjusted. Net leverage
ratio is defined as total net debt (total debt minus cash and cash
equivalents) divided by the trailing last 12 months EBITDA, as
adjusted. Cogent's gross leverage ratio and net leverage
ratio are shown below.
|
($ in 000's) –
unaudited
|
As of March 31,
2020
|
As of June 30,
2020
|
|
Cash and cash
equivalents
|
$375,116
|
$417,026
|
|
Debt
|
|
|
|
Capital (finance)
leases – current portion
|
8,268
|
14,734
|
|
Capital (finance)
leases – long term
|
159,678
|
189,044
|
|
Senior unsecured
notes
|
189,225
|
-
|
|
Senior secured
notes
|
445,000
|
445,000
|
|
Senior unsecured euro
2024 notes
|
148,507
|
393,011
|
|
Note
payable
|
12,264
|
12,831
|
|
Total debt
|
962,942
|
1,054,620
|
|
Total net
debt
|
587,826
|
637,594
|
|
Trailing 12 months
EBITDA, as adjusted
|
201,300
|
207,563
|
|
Gross leverage
ratio
|
4.78
|
5.08
|
|
Net leverage
ratio
|
2.92
|
3.07
|
Cogent's SEC filings are available online via the Investor
Relations section of www.cogentco.com or on the Securities and
Exchange Commission's website at www.sec.gov.
|
COGENT
COMMUNICATIONS HOLDINGS, INC., AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
AS OF JUNE 30, 2020 AND DECEMBER 31,
2019
(IN THOUSANDS, EXCEPT SHARE DATA)
|
|
|
June 30,
2020
|
|
December 31,
2019
|
|
|
(Unaudited)
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
417,026
|
|
$
|
399,422
|
|
Accounts receivable,
net of allowance for credit losses of $2,115 and $1,771,
respectively
|
|
|
40,560
|
|
|
40,484
|
|
Prepaid expenses and
other current assets
|
|
|
39,530
|
|
|
35,822
|
|
Total current
assets
|
|
|
497,116
|
|
|
475,728
|
|
Property and
equipment, net
|
|
|
406,747
|
|
|
368,929
|
|
Right-of-use leased
assets
|
|
|
87,697
|
|
|
73,460
|
|
Deposits and other
assets
|
|
|
13,841
|
|
|
14,007
|
|
Total assets
|
|
$
|
1,005,401
|
|
$
|
932,124
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
12,171
|
|
$
|
11,075
|
|
Accrued and other
current liabilities
|
|
|
52,492
|
|
|
51,301
|
|
Installment payment
agreement, current portion, net of discounts of $291 and $350,
respectively
|
|
|
9,374
|
|
|
9,063
|
|
Current maturities,
operating lease liabilities
|
|
|
11,292
|
|
|
10,101
|
|
Current maturities,
finance lease obligations
|
|
|
14,734
|
|
|
8,154
|
|
Total current
liabilities
|
|
|
100,063
|
|
|
89,694
|
|
Senior secured
2022 notes, net of unamortized debt costs of $1,480
and $1,897,
respectively and including premiums of $767
and $985, respectively
|
|
|
444,287
|
|
|
444,088
|
|
Senior unsecured
2024 Euro notes, net of unamortized debt costs
of $3,365 and $1,410,
respectively and net of discounts of $1,183 and $0,
respectively
|
|
|
388,463
|
|
|
150,001
|
|
Senior unsecured
2021 notes, net of unamortized debt costs
of $857
|
|
|
—
|
|
|
188,368
|
|
Operating lease
liabilities, net of current maturities
|
|
|
99,151
|
|
|
86,690
|
|
Finance lease
obligations, net of current maturities
|
|
|
189,044
|
|
|
161,635
|
|
Other long term
liabilities
|
|
|
19,943
|
|
|
15,327
|
|
Total
liabilities
|
|
|
1,240,951
|
|
|
1,135,803
|
|
Commitments and
contingencies:
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
Common stock, $0.001
par value; 75,000,000 shares authorized; 47,279,201 and
46,840,434
shares issued
and outstanding, respectively
|
|
|
47
|
|
|
47
|
|
Additional paid-in
capital
|
|
|
506,391
|
|
|
493,178
|
|
Accumulated other
comprehensive income — foreign currency translation
|
|
|
(12,906)
|
|
|
(12,326)
|
|
Accumulated
deficit
|
|
|
(729,082)
|
|
|
(684,578)
|
|
Total stockholders'
deficit
|
|
|
(235,550)
|
|
|
(203,679)
|
|
Total liabilities
and stockholders' deficit
|
|
$
|
1,005,401
|
|
$
|
932,124
|
|
COGENT
COMMUNICATIONS HOLDINGS, INC., AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE
THREE MONTHS ENDED JUNE 30, 2020 AND JUNE 30, 2019
(IN
THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
June 30, 2020
|
|
Three Months
Ended
June 30, 2019
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Service
revenue
|
|
$
|
140,990
|
|
$
|
134,789
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Network operations
(including $305 and $226 of equity-based compensation
expense,
respectively,
exclusive of depreciation and amortization shown separately
below)
|
|
|
53,886
|
|
|
54,407
|
|
Selling, general, and
administrative (including $5,778 and $5,063 of equity-based
compensation
expense, respectively)
|
|
|
39,839
|
|
|
38,566
|
|
Depreciation and
amortization
|
|
|
19,896
|
|
|
19,979
|
|
Total operating
expenses
|
|
|
113,621
|
|
|
112,952
|
|
Gains on equipment
transactions
|
|
|
205
|
|
|
185
|
|
Operating
income
|
|
|
27,574
|
|
|
22,022
|
|
Interest
expense
|
|
|
(15,499)
|
|
|
(13,595)
|
|
Realized foreign
exchange gain on issuance on 2024 Euro Notes
|
|
|
2,547
|
|
|
—
|
|
Unrealized foreign
exchange (loss) gain on 2024 Euro Notes
|
|
|
(3,420)
|
|
|
177
|
|
Loss on debt
extinguishment and redemption – 2021 Notes
|
|
|
(638)
|
|
|
—
|
|
Interest income and
other, net
|
|
|
735
|
|
|
1,576
|
|
Income before income
taxes
|
|
|
11,299
|
|
|
10,180
|
|
Income tax
provision
|
|
|
(2,735)
|
|
|
(3,044)
|
|
Net
income
|
|
$
|
8,564
|
|
$
|
7,136
|
|
|
|
|
|
|
|
|
Comprehensive
income:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
8,564
|
|
$
|
7,136
|
|
Foreign currency
translation adjustment
|
|
|
2,913
|
|
|
1,786
|
|
Comprehensive
income
|
|
$
|
11,477
|
|
$
|
8,922
|
|
|
|
|
|
|
|
|
Net income per
common share:
|
|
|
|
|
|
|
|
Basic net income per
common share
|
|
$
|
0.19
|
|
$
|
0.16
|
|
Diluted net income
per common share
|
|
$
|
0.18
|
|
$
|
0.16
|
|
Dividends declared
per common share
|
|
$
|
0.68
|
|
$
|
0.60
|
|
|
|
|
|
|
|
|
Weighted-average
common shares - basic
|
|
|
45,754,880
|
|
|
45,354,327
|
|
|
|
|
|
|
|
|
Weighted-average
common shares - diluted
|
|
|
46,686,665
|
|
|
45,912,291
|
|
COGENT
COMMUNICATIONS HOLDINGS, INC., AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE
SIX MONTHS ENDED JUNE 30, 2020 AND JUNE 30, 2019
(IN
THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
June 30, 2020
|
|
Six Months
Ended
June 30, 2019
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Service
revenue
|
|
$
|
281,904
|
|
$
|
268,930
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Network operations
(including $557 and $406 of equity-based compensation
expense,
respectively,
exclusive of depreciation and amortization shown separately
below)
|
|
|
109,806
|
|
|
108,557
|
|
Selling, general, and
administrative (including $10,600 and $8,318 of equity-based
compensation
expense,
respectively)
|
|
|
79,513
|
|
|
74,427
|
|
Depreciation and
amortization
|
|
|
39,402
|
|
|
40,240
|
|
Total operating
expenses
|
|
|
228,721
|
|
|
223,224
|
|
Gains on equipment
transactions
|
|
|
244
|
|
|
721
|
|
Operating
income
|
|
|
53,427
|
|
|
46,427
|
|
Interest
expense
|
|
|
(30,720)
|
|
|
(27,051)
|
|
Realized foreign
exchange gain on issuance of 2024 Euro Notes
|
|
|
2,547
|
|
|
—
|
|
Unrealized (loss)
gain on foreign exchange on 2024 Euro Notes
|
|
|
(512)
|
|
|
177
|
|
Interest income and
other, net
|
|
|
28
|
|
|
3,395
|
|
Loss on debt
extinguishment and redemption- 2021 Notes
|
|
|
(638)
|
|
|
—
|
|
Income before income
taxes
|
|
|
24,132
|
|
|
22,948
|
|
Income tax
provision
|
|
|
(6,341)
|
|
|
(6,595)
|
|
Net
income
|
|
$
|
17,791
|
|
$
|
16,353
|
|
|
|
|
|
|
|
|
Comprehensive
income:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
17,791
|
|
$
|
16,353
|
|
Foreign currency
translation adjustment
|
|
|
(580)
|
|
|
(39)
|
|
Comprehensive
income
|
|
$
|
17,211
|
|
$
|
16,314
|
|
|
|
|
|
|
|
|
Net income per
common share:
|
|
|
|
|
|
|
|
Basic net income per
common share
|
|
$
|
0.39
|
|
$
|
0.36
|
|
Diluted net income
per common share
|
|
$
|
0.38
|
|
$
|
0.36
|
|
|
|
|
|
|
|
|
Dividends declared
per common share
|
|
$
|
1.34
|
|
$
|
1.18
|
|
|
|
|
|
|
|
|
Weighted-average
common shares - basic
|
|
|
45,760,302
|
|
|
45,349,397
|
|
|
|
|
|
|
|
|
Weighted-average
common shares - diluted
|
|
|
46,592,445
|
|
|
45,838,918
|
|
COGENT
COMMUNICATIONS HOLDINGS, INC., AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE
MONTHS ENDED JUNE 30, 2020 AND JUNE 30, 2019
(IN
THOUSANDS)
|
|
|
|
|
|
|
|
|
|
Three months
Ended
June 30, 2020
|
|
Three months
Ended
June 30, 2019
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
8,564
|
|
$
|
7,136
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
19,896
|
|
|
19,977
|
|
Amortization of debt
costs, discounts and premiums
|
|
|
453
|
|
|
428
|
|
Equity-based
compensation expense (net of amounts capitalized)
|
|
|
6,083
|
|
|
5,290
|
|
Loss on debt
extinguishment and redemption – 2021 Notes
|
|
|
638
|
|
|
—
|
|
Unrealized losses
(gains) on foreign exchange
|
|
|
3,383
|
|
|
(177)
|
|
Realized foreign
exchange gain on issuance of 2024 Notes
|
|
|
(2,547)
|
|
|
—
|
|
Gains - equipment
transactions and other, net
|
|
|
(448)
|
|
|
(76)
|
|
Deferred income
taxes
|
|
|
1,814
|
|
|
2,259
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
2,697
|
|
|
(1,259)
|
|
Prepaid expenses and
other current assets
|
|
|
628
|
|
|
(360)
|
|
Accounts payable,
accrued liabilities and other long-term liabilities
|
|
|
453
|
|
|
7,866
|
|
Deposits and other
assets
|
|
|
(303)
|
|
|
(452)
|
|
Net cash provided by
operating activities
|
|
|
41,311
|
|
|
40,632
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
|
|
(13,930)
|
|
|
(11,720)
|
|
Net cash used in
investing activities
|
|
|
(13,930)
|
|
|
(11,720)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Dividends
paid
|
|
|
(31,738)
|
|
|
(27,741)
|
|
Redemption and
extinguishment of 2021 Notes
|
|
|
(189,225)
|
|
|
—
|
|
Net proceeds from
issuance of senior unsecured 2024 Euro Notes - net of debt costs of
$2,137 and $1,556, respectively
|
|
|
240,285
|
|
|
152,128
|
|
Principal payments on
installment payment agreement
|
|
|
(2,562)
|
|
|
(2,387)
|
|
Principal payments of
finance lease obligations
|
|
|
(3,716)
|
|
|
(1,976)
|
|
Proceeds from exercises
of stock options
|
|
|
271
|
|
|
746
|
|
Net cash provided by
financing activities
|
|
|
13,315
|
|
|
120,770
|
|
Effect of exchange
rates changes on cash
|
|
|
1,214
|
|
|
459
|
|
Net increase in cash
and cash equivalents
|
|
|
41,910
|
|
|
150,141
|
|
Cash and cash
equivalents, beginning of period
|
|
|
375,116
|
|
|
259,138
|
|
Cash and cash
equivalents, end of period
|
|
$
|
417,026
|
|
$
|
409,279
|
|
|
|
|
|
|
|
|
COGENT
COMMUNICATIONS HOLDINGS, INC., AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS
ENDED JUNE 30, 2020 AND JUNE 30, 2019
(IN
THOUSANDS)
|
|
|
|
|
|
|
|
|
|
Six months
Ended
June 30, 2020
|
|
Six months
Ended
June 30, 2019
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
17,791
|
|
$
|
16,353
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
39,402
|
|
|
40,240
|
|
Amortization of debt
costs, discounts and premiums
|
|
|
930
|
|
|
842
|
|
Equity-based
compensation expense (net of amounts capitalized)
|
|
|
11,157
|
|
|
8,724
|
|
Loss on debt
extinguishment and redemption – 2021 Notes
|
|
|
638
|
|
|
—
|
|
Unrealized losses
(gains) on foreign exchange
|
|
|
479
|
|
|
(177)
|
|
Realized foreign
exchange gain on issuance of 2024 Notes
|
|
|
(2,547)
|
|
|
—
|
|
Gains - equipment
transactions and other, net
|
|
|
(902)
|
|
|
(307)
|
|
Deferred income
taxes
|
|
|
4,253
|
|
|
4,831
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(93)
|
|
|
1,005
|
|
Prepaid expenses and
other current assets
|
|
|
(2,465)
|
|
|
(3,547)
|
|
Accounts payable,
accrued liabilities and other long-term liabilities
|
|
|
1,523
|
|
|
5,088
|
|
Deposits and other
assets
|
|
|
(397)
|
|
|
(3,783)
|
|
Net cash provided by
operating activities
|
|
|
69,769
|
|
|
69,269
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
|
|
(26,796)
|
|
|
(25,008)
|
|
Net cash used in
investing activities
|
|
|
(26,796)
|
|
|
(25,008)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Dividends
paid
|
|
|
(62,295)
|
|
|
(54,306)
|
|
Redemption and
extinguishment of 2021 Notes
|
|
|
(189,225)
|
|
|
—
|
|
Net proceeds from
issuance of senior unsecured 2024 Euro Notes - net of debt costs of
$2,137 and $1,556, respectively
|
|
|
240,285
|
|
|
152,128
|
|
Principal payments on
installment payment agreement
|
|
|
(5,128)
|
|
|
(4,774)
|
|
Principal payments of
finance lease obligations
|
|
|
(9,883)
|
|
|
(5,006)
|
|
Proceeds from exercises
of stock options
|
|
|
989
|
|
|
919
|
|
Net cash (used
in) provided by financing activities
|
|
|
(25,257)
|
|
|
88,961
|
|
Effect of exchange
rates changes on cash
|
|
|
(112)
|
|
|
(36)
|
|
Net increase in cash
and cash equivalents
|
|
|
17,604
|
|
|
133,186
|
|
Cash and cash
equivalents, beginning of period
|
|
|
399,422
|
|
|
276,093
|
|
Cash and cash
equivalents, end of period
|
|
$
|
417,026
|
|
$
|
409,279
|
|
|
|
|
|
|
|
Except for historical information and discussion contained
herein, statements contained in this release constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such
statements include, but are not limited to statements identified by
words such as "believes," "expects," "anticipates," "estimates,"
"intends," "plans," "targets," "projects" and similar
expressions. The statements in this release are based upon
the current beliefs and expectations of Cogent's management and are
subject to significant risks and uncertainties. Actual
results may differ from those set forth in the forward-looking
statements. Numerous factors could cause or contribute to
such differences, including the impact of the COVID-19 pandemic and
the related government policies; future economic instability in the
global economy or a contraction of the capital markets which could
affect spending on Internet services and our ability to engage in
financing activities; the impact of changing foreign exchange rates
(in particular the Euro to USD and Canadian dollar to USD exchange
rates) on the translation of our non-USD denominated revenues,
expenses, assets and liabilities; legal and operational
difficulties in new markets; the imposition of a requirement
that we contribute to the US Universal Service Fund on the basis of
our Internet revenue; changes in government policy and/or
regulation, including net neutrality rules by the United
States Federal Communications Commission and in the area of data
protection; increasing competition leading to lower prices for our
services; our ability to attract new customers and to increase and
maintain the volume of traffic on our network; the ability to
maintain our Internet peering arrangements on favorable terms; our
reliance on an equipment vendor, Cisco Systems Inc., and the
potential for hardware or software problems associated with such
equipment; the dependence of our network on the quality and
dependability of third-party fiber providers; our ability to retain
certain customers that comprise a significant portion of our
revenue base; the management of network failures and/or
disruptions; and outcomes in litigation as well as other risks
discussed from time to time in our filings with the Securities and
Exchange Commission, including, without limitation, our Quarterly
Report on Form 10-Q for the for the quarters ended June 30, 2020 and March
31, 2020 and our Annual Report on Form 10-K for the year
ended December 31, 2019. Cogent
undertakes no duty to update any forward-looking statement or any
information contained in this press release or in other public
disclosures at any time.
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SOURCE Cogent Communications Holdings, Inc.