February 24, 2011 – (HOSTSEARCH.COM) –
iWeb (TSXV: IWB), a global provider of Internet hosting services and IT infrastructure, today released its financial results for the first quarter (Q1) of its fiscal 2011, quarter ended December 31, 2010.
First Quarter Highlights:
- 17% increase in revenues, from $6.9 million to $8.0 million
- Launch of "Smart Servers"
- Added $205,000 in monthly recurring revenue, 50% more than recurring revenues generated in the entire previous fiscal year
- Adjusted EBITDA of $1.7 million (21% of revenues)
- Operating loss of $956,000, net loss of $1.0 million
"Growing iWeb's revenue was one of the main priorities throughout the first quarter. Because they are recurring, these results will affect the company's results throughout the coming quarters." said Eric Chouinard, iWeb President. "With strong sales demand for the Smart Server, iWeb's new automation technology, the first quarter represents a very constructive start to the year. 2011 should be a very exciting year for iWeb!"
"A very important indication of performance is the addition of $205,000 in recurring monthly revenue," said Philip Tousignant, Chief Financial Officer. "This represents $2.5 million annually, or 57% of the new recurring revenue generated during the previous four quarters combined. Lower gross margins and adjusted EBITDA for this quarter are mainly explained by the fixed costs related to the infrastructure of the new data center supporting the Smart Servers. The accelerated additions of new revenues coming from the Smart Servers should provide future savings in the labor costs, resulting from the automated deployment of these servers."
First quarter 2011 financial review
Unless otherwise indicated, all amounts are in U.S. dollars (USD). Since September 30, 2010, the company's financial results are presented in U.S. dollars.
Revenues rose 17% year-over-year, from $6.9 million to $8.0 million. 80% of all revenues generated during the quarter were in U.S. dollars.
EBITDA of $1.7 million, approximately 21% of revenues, were lower than EBITDA of $1.9 million recorded in Q1-2010.
Compared to net income of $170 000 in the first quarter of 2010, iWeb recorded a net loss of $1.0 million for the quarter, primarily the result of an operating loss of $956,000 and unrealized foreign exchange loss on long-term debt.
The addition of $205,000 new net recurring revenue (NNRR), which is billed monthly, represents $2.5 million on an annual basis, equivalent to 57% of the $359,000 NRRN generated for all four quarters of 2010 COMBINED.
During the first quarter, iWeb acquired tangible and intangible assets totaling $3.2 million, doubling the $1.6 million for Q1-2010. The addition of new servers to support services sold during the quarter, completion of the construction of Phase I of the new data center (iWeb-NE) and significant investments in systems development, especially iWeb's proprietary "Smart Layer" platform represent the bulk of the amounts invested during the quarter.
Complete interim financial statements and Management's Discussion and Analysis (MD&A) of the company are available on http://investors.iweb.com and SEDAR (http://www.sedar.com).
About iWeb Group Inc.
iWeb provides Internet hosting services and IT infrastructure to 24,600 customers in 150 countries. With its four data centers, iWeb's total capacity has reached 34,000 dedicated servers, over 1,100 co-location cabinets and 77 Gigabits per second (Gbps) of Internet connectivity, from 9 separate providers.
One of Canada's 100 fastest growing companies according to PROFIT Magazine, iWeb now generates more than 60% of its revenues, which reached $29 million U.S. in 2010, from abroad. Founded in 1996 in Montreal, iWeb shares are traded on the TSX Venture Exchange under the symbol "IWB".
