RCN’s loss narrows in first quarter
RCN Corp. posted a first-quarter net loss of $9.6 million, which was a vast improvement over the net loss of $26.2 million in the same quarter a year ago.
RCN’s total revenue improved 5 percent to $189.2 million from the $179.8 million the Herndon, Va.-based company had in the first quarter a year ago. Analysts who were polled by Thomson Reuters had forecast the company to report revenues of $1.89.73 million for the first quarter.
"RCN achieved solid first-quarter results, despite challenging economic conditions, growing revenue, EBITDA, and customers from last year and delivering positive free cash flow," said RCN President and CEO Peter D. Aquino. "In our residential/SMB segment, we increased customers and RGUs from last year, with demand for data, all-digital video – including RCN Global Passport – and video-on-demand driving growth. This segment also benefited from gains at RCN Business Services, our small-medium business unit, particularly in the hospitality vertical.
“Further, the RCN Metro segment showed robust results, as growth in revenue and EBITDA expanded EBITDA margin to nearly 32 percent. The two segments' performance, combined with a more modest capital program, produced over $7 million in free cash flow in the quarter.”
RCN’s operating income in the first quarter was $0.9 million compared with a loss of $12.7 million in the first quarter a year ago.
RCN’s business customers increased to approximately 429,000, and total revenue-generating units increased to approximately 914,000.
The company’s bundle rate remained steady at 68 percent. The digital video penetration rate rose to 91 percent of video customers, thanks to the completion of Project Analog Crush, which achieved 100 percent digital penetration in those markets.
In other RCN-related news, RCN Metro Optical Networks, a division of RCN, announced today that it was picked by CAL Financial, a California corporation in the business of developing proprietary electronic trading systems, to provide Carrier Class Ethernet Transport Services. RCN Metro will provide a carrier-class Ethernet connection from CAL Financial's trading partner in New York City to a Chicago-based financial exchange.