Mar, 2002 : Interland Reports 76 Percent Year-End Growth

📅 March 28, 2002 - Interland, Inc., a Web hosting services provider, today announced financial results for its second fiscal quarter, ended February 28, 2002. The company reported revenues of $25.5 million for the quarter, an increase of 76.6 percent over the 12-month period. Gross margins continued to improve, reaching 46 percent for the quarter, compared with 43.2 percent for the prior quarter. Adjusted EBITDA loss was $6.4 million, meeting analyst expectations, compared with $8.5 million for the prior quarter, a 25 percent improvement.

Reflecting the effects of accounting for two acquisition transactions completed during the quarter, net loss for the quarter was $19.6 million or $0.14 per share. Loss from continuing operations, excluding merger, integration and restructuring expenses and one time loss on the sale of the connectivity business was approximately $0.11 per share, based upon approximately 137.3 million weighted average shares outstanding. Adjusted for acquisitions, loss per share was in line with previous guidance.
Interland (interland.com 👉 Total Reviews: 2
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?Executing on our strategy of being a profitable, high-margin provider of standardized Web hosting services--with a gross margin target of well above 50 percent--we've continued to cull out unprofitable business, seizing the opportunity to eliminate nearly $3 million in low-margin revenue and replace it through the acquisition of higher-margin, scalable business. As a result, we've continued to improve efficiency and gross margins, and made significant EBITDA progress,? said Joel J. Kocher, chairman and chief executive officer of Interland.
?In fact, many of the company's achievements in the second quarter, including acquisitions and operating cost reductions, aren't yet fully reflected in performance results, but should be realized in the third quarter. With the progress we have made, and the efficiency gains and scale we have achieved, we believe we are on target for our goal of achieving free cash flow positive by the end of our current fiscal year in August 2002.?
The company also completed and integrated Interland and AT&T customers into the company's centralized platform, and acquired CommuniTech.Net. These acquisitions resulted in higher depreciation and amortization charges for the quarter, as well as a reduction in cash available for investment, lowering interest income.
Making significant progress on key metrics, annualized revenue per square foot of data center space was up nearly nine percent from the prior quarter to more than $2,600 at the quarter. Annualized revenue per employee was up more than 13 percent to $157,700. Those improvements do not reflect the full impact of late-quarter acquisitions or cost reductions.
The company reduced its total headcount from 1,041 in August 2001 to 648 at the end of February?cut mainly from executive and management levels. The total reduction of staff was 16 percent (before the addition of CommuniTech.Net employees) and is expected to result in more than $5 million in annualized savings.
Interland also announced the addition of six prominent institutional investors, together with the company and four of its directors, purchasing all of the approximately 58.6 million shares of the company's stock, previously held by the Micron Technology Foundation.