Song Networks Holding AB Announces Second Quarter, 2001 results

Song Networks Holding AB Announces Second Quarter, 2001 results Song Networks Reports 125% Revenue Growth over the Second Quarter 2000, 20% Revenue Growth over the First Quarter 2001, 815 Sites Connected to its Fiber Network and 5 054 Directly Connected Corporate Customers. Stockholm, Sweden - August 15, 2001 - Song Networks Holding AB ("Song Networks"), formerly Tele1 Europe Holding AB, (OM Stockholm Stock Exchange: SONW, NASDAQ: SONW), the leading pan-Nordic competitive provider of broadband communication services, today reported second quarter financial and operating results. Commenting on the results, Ivar Strömberg, Song Networks' Chief Executive Officer said: "Revenue, customer and network growth continued to be strong in the second quarter, further solidifying our position as a leading broadband operator for corporate customers in the Nordic region. The successful completion of two strategic acquisitions this quarter improves our geographic reach, complements our broadband services, provides us with valuable technical competence and speeds up the implementation of our Nordic network. During the quarter, we successfully added 5,853 corporate customers for a total of 19,726, and directly connected customers rose by 1,967 to 5,054. As of 30 June 2001 we had completed an additional 295 km of local access fiber, for a total of 2,056 km and had 815 sites connected to our fiber network. Finally, with approximately SEK 2.7 billion (USD 249 million) in cash and cash equivalents, we believe we have sufficient reserves to fully fund our business plan." Financial Highlights: · Second quarter revenues rose by SEK 86 million (USD 8 million) to SEK 503 million (USD 46 million), a 20% increase over the first quarter revenues and 125% over the same quarter last year. · Gross margin was 30.7% for the second quarter versus 34.7% for the second quarter of 2000. · Adjusted EBITDA, as a percentage of revenues was -35%, including non-recurring costs of approximately SEK 19 million (USD 1.7 million) related to redundancy charges in Norway. · Direct corporate revenues 1) represented 44% of total revenue in the second quarter, compared with 39% in the first quarter of 2001. · Revenues from data and internet services 2) totaled SEK 135 million (USD 12 million) or 27% of total revenue. · Business plan continues to be fully funded with approximately SEK 2.7 billion (USD 249 million) in cash and cash equivalents, including restricted cash. · Operational Highlights: · At the end of the quarter, 815 sites were connected to our fiber network. · The number of corporate customers rose by 5,853 to 19,726. Directly connected customers totaled 5,054, an increase of 1,967, and directly connected sites totaled 8,747, an increase of 3,568. · Successfully increased the number of DSL sites by 1,118 of which 792 were added organically and 326 through acquisitions. The total number of DSL sites at the end of the quarter was 3,275. · Dedicated hosting customers totaled 139. · Completed construction of an additional 295 km of local access fiber, for a total of 2,056 km. · Deployed 668 km of backbone fiber, for a total of 7,975 km. · Successfully increased the number of active IP/VPN sites to approximately 1,000. · Shareholders approved the adoption of Song Networks Holding AB as the new Company name during the Annual General Meeting held in May. · Formed an internet peering and interconnection partnership with leading European alternative carriers. · Received an order from Arkitektkopia, an information processing company, with a total contract value of SEK 15 million (USD 1.4 million) for an IP/VPN contract covering 37 sites. · Scribona, a Swedish distributor and reseller of information technology products, entered into a Nordic data communications agreement with Song Networks with a total contract value of SEK 15 million (USD 1.4 million). · Was chosen as preferred vendor by the Swedish Agency for Public Management · Claus Jacobsen, formerly the managing Director of Song Networks' Danish subsidiary, was appointed Vice President Network & Operations at group level. Lars Netterstrøm, formerly the Deputy Managing Director in Denmark, assumed the Danish Managing Director position. Acquisition Highlights: · In May, Song Networks acquired a significant portion of Sonera's data and telephony operations in Sweden. The acquired operations had fiscal 2000 revenues of approximately SEK 190 million (USD 17.5 million). The purchase price of approximately SEK 200 million (USD 18.4 million) in cash. · In June, the Company acquired Telia Finland Oy, the Finnish arm of the Swedish telecom group. Telia Finland, which operates a nation wide wire line data and telephony network, had fiscal 2000 revenues of approximately SEK 460 million (USD 42.3 million), is EBITDA positive and has 190 employees. The purchase price of approximately SEK 480 million (USD 44.1 million) was paid 70% in cash and 30% in Song Networks Holding AB shares. Subsequent Events: · In July, Song Networks signed a contract with, a large international consultancy firm, to provide IP/VPN data communication services. The order has a value of approximately SEK 14 million (USD 1.3 million) and covers a three-year contract period. · The Company signed a four-year agreement, with a contract value of approximately SEK 9 million (USD 0.8 million), with the Norwegian branch of the Handelsbanken Group for data communication services. · In July, Song Networks announced that it is negotiating the sale of Cegal AS, the Company's Norwegian application service provider ("ASP") subsidiary. The potential buyer, Intellinet ASA, is a full service Scandinavian ASP. · Ketil Kivedahl, the former Managing Director of Xerox AS, was appointed the new Managing Director of Song Networks AS, the Company's Norwegian subsidiary. Direct revenues include on-net revenues, hosting revenues and revenues from leasing capacity to corporates. Revenues from data and internet services include hosting revenues and revenues from leasing capacity to corporate customers. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2001/08/15/20010815BIT00830/bit0002.doc The full report http://www.waymaker.net/bitonline/2001/08/15/20010815BIT00830/bit0002.pdf The full report