For what is likely their last earnings report before the merger with Zayo closes, Bill LaPerch and his crew turned in a big growth quarter. Revenues were up strongly across all segments and 5% sequentially overall, easily besting composite analyst projections. Earnings per share were in-line with estimates, and margins and capex were all right on target with guidance. Here’s a quick table of their results in context:
| $ in millions | Q1/11 | Q2/11 | Q3/11 | Q4/11 | Q1/12 | FY2012 (guidance) |
|---|---|---|---|---|---|---|
| – Domestic metro | 31.4 | 32.1 | 32.7 | 33.3 | 35.2 | |
| – Domestic WAN | 23.6 | 25.7 | 26.9 | 28.8 | 30.1 | |
| – Domestic fiber | 45.1 | 45.3 | 45.8 | 45.9 | 46.5 | |
| – Europe | 10.6 | 11.1 | 11.4 | 11.8 | 12.6 | |
| Revenue | 114.4 | 118.3 | 118.2 | 121.6 | 127.7 | $515-525 |
| Adj. EBITDA | 51.5 | 54.0 | 56.4 | 55.9 | 58.5 | |
| EBITDA Margin | 45.0% | 45.6% | 47.7% | 46.0% | 45.8% | ~46% |
| Capex | 31.1 | 37.3 | 40.2 | 39.2 | 41.2 | $155-165 |
| EPS (diluted) | 0.54 | 0.60 | 0.67 | 0.90 | 0.68 |
With the merger pending, they won’t be holding a call and thus we aren’t going to get much color. Take a good look at those numbers, because once AboveNet’s assets go private the possible metro fiber plays available to the average investor will have dwindled substantially. But it’s their own fault for not respecting the company’s value proposition as highly as private equity. Maybe we’ll get lucky and Zayo will finally go public next year…
In parallel, AboveNet and ancotel announced that AboveNet will be leveraging the vmmr.® platform at ancotel’s flagship Kleyer90 facility to help power its Ethernet expansion in Europe. AboveNet has been assembling its core infrastructure in Frankfurt even moreso than its other continental European expansion markets, which reflects its status as the largest hub in Western Europe.
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Categories: Financials · Metro fiber
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“But it’s their own fault for not respecting the company’s value proposition as highly as private equity. ”
Uh, Private Equity (Zayo) didn’t pay a ridiculous premium to public valuation or peer valautions so I’m not sure this statement is true.
Ok, so I engaged in a bit of hyperbole, so shoot me. I just think the market as a whole ought to wake up a bit when it comes to valuing this stuff before Zayo finishes cornering the market. 🙂 Dang, did it again.
Rob, you are publicly disclosing our secret grand plan. Shush please.
Secret? I thought it was almost a public manifesto by now!
yada yada