(Source: Business Wire)
Atlantic Tele-Network, Inc. (NASDAQ: ATNI) today reported results for the quarter ended March 31, 2009. For the three months ended March 31, 2009, revenue was $56.0 million, an increase of $10.4 million, or 23%, as compared to revenue of $45.6 million for the three months ended March 31, 2008. Net income attributable to Atlantic Tele-Network, Inc. Stockholders1 was $8.8 million for the quarter, as compared to $7.9 million for the same period in 2008, an increase of $0.9 million, or 11%. On a per share basis, net income attributable to Atlantic Tele-Network, Inc. stockholders increased by 14% to $0.58 per diluted share from $0.51 per diluted share for the three months ended March 31, 2008.
Revenue and operating income for the quarter were positively impacted by the consolidation of our Bermuda operations following the May 2008 increase in our ownership position.
"We were pleased to continue our revenue growth in the first quarter," said Michael T. Prior, Chief Executive Officer of Atlantic Tele-Network, Inc., "and also to deliver steady operating and net income gains. The strong, double-digit revenue growth largely reflects the same factors behind our growth in 2008: the expansion of the territory covered and minutes and megabytes served by our US wireless business and our increased ownership of the leading wireless provider in Bermuda. The benefits of this strong performance and revenue growth were partly offset by the continued decline in our international revenues in Guyana, due to bypass and macro-economic conditions. That same factor, as well as the addition in the third quarter of 2008 of two earlier stage businesses, also limited the overall growth in operating income and net income for this quarter.
"On the positive side in Guyana, we did see a slight pickup in our wireless subscribers in that market, over the end of 2008, after a number of consecutive quarters of significant declines. Bermuda wireless subscribers also grew modestly in the quarter. Our local telephone and data revenues also rose because of gains in the US operations, but that increase had little benefit on operating profits because the operations in New York State are still early stage and thus produced operating losses. As the year progresses," Mr. Prior added, "we do not expect our US wireless operations to grow at quite this rate, but we hope to find a solution to reduce the rate of decline in international revenue."
First Quarter 2009 Operating Highlights
The following operating results for the quarter ended March 31, 2009 are compared against the same period in 2008 unless otherwise indicated.
Wireless Revenue. Wireless revenue increased by $11.9 million, or 60%, to $31.7 million from $19.8 million. Our U.S. rural wireless business increased revenues by $7.1 million, or 49%, to $21.6 million from $14.5 million. This was a result of our ongoing deployment of new base stations along with growth in recurring voice and data traffic. We ended the quarter with a total of 484 base stations in our U.S. network,
-- including 46 sites from the acquisition of wireless network assets of CC Communications in Nevada in late December 2008 -- up from 328 base stations as of March 31, 2008. The increase in our equity position in, and consolidation of, our Bermuda Digital Communications (BDC) operations, which occurred as of May 15, 2008, contributed $5.2 million of the increase. In Guyana, our wireless revenue declined by $0.3 million, as increased competition led to a decrease in our wireless customer base to approximately 254,000 subscribers as of March 31, 2009 from 301,000 as of March 31, 2008. The subscriber base, however, increased from 248,000 as of December 31, 2008.
Local Telephone and Data Revenue. Local telephone and data revenue grew to $13.1 million compared to $12.2 million in 2008, an increase of $0.9 million, or 7%. Sovernet's local telephone and data revenue increased $0.9 million, or 24%, to $4.6 million from $3.7 million in 2008. This increase is mainly due to Sovernet's acquisition of ION in August 2008. Local telephone and data revenue generated by our Guyana operations remained at $7.4 million quarter over quarter, while access lines increased from 134,000 lines to 140,000 lines, or 4%. Data revenue at our Virgin Islands subsidiary remained fairly consistent.
International Long Distance Revenue. International long distance revenue, all of which is generated by our GT&T subsidiary, was $10.4 million in 2009, a decrease of $2.2 million, or 17%, from $12.6 million in 2008. We believe this decrease is a result of a considerable increase in illegal bypass activities in the quarter resulting in lost revenue opportunities, as well as an overall reduction in call volume into Guyana as an outcome of the current worldwide economic slowdown.
Operating Expenses. Operating expenses increased by $9.2 million, or 31%, from $30.0 million to $39.2 million for the first quarter of 2008 and 2009, respectively. Of this increase, $5.0 million represents operating expenses of BDC which the Company began consolidating as of May 2008. Our U.S. wireless business also had an increase of $3.6 million in operating expenses as our costs of sales and depreciation and amortization expense increased as a result of our network expansion and associated revenue growth. Operating expenses for the first quarter of 2008 and 2009 also included non-cash stock based compensation expense of $0.3 million.
Operating Income. Operating income increased by $1.1 million, or 7%, from $15.7 million to $16.8 million for the quarter. This increase came predominately from U.S. wireless revenue growth, offset by a decrease in international long distance revenue at our Guyana operations.
Conference Call Information
Atlantic Tele-Network will host a conference call tomorrow, Thursday, April 30, 2009 at 9:30 a.m. Eastern Time (ET) to discuss its first quarter results for 2009. The call will be hosted by Michael Prior, President and Chief Executive Officer, and Justin Benincasa, Chief Financial Officer. The dial-in numbers are US/Canada: (800) 771-6916 and International: (212) 231-2905. A replay of the call will be available from 12:00 p.m.
