VoIP phone service provider Vonage
released its fourth quarter and full year earnings reports today. This was the first quarter for which the company reported net income from operations, excluding adjustments.
For 2009 Vonage (News
) reported net income excluding adjustments of $3 million or $0.02 per share, an increase of $37 million or $0.24 per share versus 2008.
Adjusted EBITDA was $119 million, more than double the $54 million reported in 2008. The company generated income from operations of $57 million. This is an improvement of $64 million from the prior year. Total revenue of $889 million declined by $11 million from 2008 as a result of the elimination of upfront shipping and equipment fees; service revenue was flat. Average revenue per subscriber increased each quarter throughout the year, as pricing and promotional mix improved.
“In many ways, 2009 was a remarkable year for Vonage,” said Marc Lefar, Vonage chief executive officer, in a release. “During the past year, we upgraded our value proposition, enhanced the customer experience, reduced costs and better positioned the Company for future growth – this has been a breakthrough financial year. Although we faced considerable challenges due to the economy, competition and wireless substitution, we are stronger and more vibrant than ever.”
For the fourth quarter Vonage generated net income of $4 million or $0.02 per share. This is an improvement of $45 million from a loss in the fourth quarter of 2008 and $59 million sequentially.
Vonage reported record adjusted EBITDA of $34 million. This was an increase of $14 million from the fourth quarter of 2008 and $1 million sequentially. Revenue of $224 million increased from $222 million year-over-year and sequentially. Income from operations increased to $19 million, up $16 million from the year ago quarter and $1 million sequentially.
According to the release customer churn declined to 2.8 percent from 3.4 percent sequentially, driven by customer service initiatives put in place over the past year, new product and service offerings such as Vonage World, and improvements in network quality. The company narrowed net line losses to 10,000 from 50,000, sequentially, and finished the year with 2.4 million lines in service.
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In other news Vonage today announced
that it has appointed Barry L. Rowan as executive vice president, chief financial officer, chief administrative officer and treasurer of the company. Rowan joins Vonage after spending three years with Nextel Partners, Inc., where he served as executive vice president, chief financial officer and treasurer. During his time at Nextel Partners, Inc., the equity value of the company grew from $2 billion to over $9 billion, culminating in its sale to Sprint (News
) for $10 billion in June of 2006.