RCN ups revenue, RGUs in Q2

Thu, 08/07/2008 - 8:30am
Traci Patterson

RCN Corp. reported a 16 percent year-over-year increase in total revenue for its second quarter of 2008, bringing in $184 million, which compares with $159 million in the second quarter of 2007.

The company’s total revenue of $184 million for the quarter also marks a 3 percent increase sequentially.

The company’s net loss at the end of the quarter was $16.7 million, compared with a net loss of $79.8 million a year ago.

RCN had approximately 424,000 residential and small- and medium-size business customers as of June 30, compared with 421,000 as of March 31 and 409,000 customers as of June 30, 2007.

Total revenue-generating units (RGUs) increased 4 percent from last year – to approximately 909,000 – with video, voice and data RGUs all increasing. Video RGUs totaled 363,000 at quarter-end, up from 355,000 a year ago; data RGUs were 295,000, an increase of 25,000 compared with Q2 2007; and voice RGUs totaled 250,000, up 2,000 from a year ago but down 1,000 sequentially.

At quarter-end, RCN’s digital video penetration rate rose to 75 percent of video customers, compared with 63 percent in the second quarter of 2007 and 72 percent in the first quarter of 2008, primarily resulting from continued investments in Project Analog Crush, RCN said.

Peter D. Aquino, president and CEO of RCN, said: “RCN’s second-quarter results demonstrate continued momentum, with solid gains in revenue and EBITDA and consolidated EBITDA margins now reaching 26 percent. Our growth strategy of winning customers from both cable and telecom incumbents across multiple products and customer segments is paying off, as we continue to leverage our unique metro and regional fiber platform. In addition, we were quite pleased to secure an extension of our set-top box waiver from the FCC through January 31, 2009, which will allow us to accelerate our Analog Crush project, reclaiming spectrum to deliver 100+ HD channels and support continued growth in broadband services. During the second half of the year, we will remain focused on delivering the key revenue and cost initiatives needed to achieve our goal of 30 percent EBITDA margins, and based on our strong performance this quarter, we are confident that we are on track.”

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