Home | Business News | Browse by Publication | P | PR Newswire

Vonage Holdings Corp. Reports First Quarter 2009 Results.

Article Excerpt
- Sixth Consecutive Quarter of Growth in Adjusted EBITDA(1) -

- Second Consecutive Quarter of Positive Income from Operations -

- GAAP Net Income of $5 Million or $0.03 per Share -

HOLMDEL, N.J., May 7 /PRNewswire-FirstCall/ -- Vonage Holdings Corp. , a leading provider of broadband telephone service, today announced results for the first quarter ended March 31, 2009.

Vonage reported record high adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA")(1) of $21 million, up from $8 million in the year ago quarter and $20 million sequentially. This is the sixth consecutive quarter of positive and increasing adjusted EBITDA resulting primarily from the Company's focus on effectively managing costs and selling, general and administrative ("SG&A") expenses.

Vonage reported positive income from operations of $5 million, up from a loss of $4 million the prior year and income of $3 million sequentially. Revenue of $224 million was flat year-over-year, and increased 1% sequentially. The Company reported GAAP net income of $5 million or $0.03 per share, up from a loss of $9 million or $0.06 the prior year. Net income in the first quarter 2009 includes a $13 million mark-to-market adjustment relating to the derivative liability in the Company's convertible debt. Net loss excluding this adjustment(2) was $8 million or $0.05 per share.

Marc Lefar, Vonage Chief Executive Officer, said, "We continued to improve our financial performance during the first quarter of 2009, with solid gains in adjusted EBITDA as well as increased cash flow from our existing customer base."

"We also expanded initiatives during the quarter to improve productivity and reduce costs across the company, while continuing to invest in new growth opportunities including mobile applications and international products and services. Additionally, we announced in April the selection of TBWA\Chiat\Day, a firm known for creating impactful messaging on highly regarded brands, as our new advertising agency. We expect the launch of a new marketing campaign in late spring and look forward to improving the Company's media strategy and marketing efficiency."

First Quarter 2009 Financial and Operating Highlights

Revenue for the first quarter was $224 million, flat from the year-ago period. Average revenue per user ("ARPU") of $28.86(4) was flat year-over-year and up from $28.33 sequentially. Telephony services ARPU was $27.78(4), a decrease from $27.87 reported a year ago and up from $27.28 sequentially. The sequential increase in telephony services ARPU was driven by promotions mix, tighter controls on customer...