KPNQwest Doubles Revenues, Deepens Losses
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[London, ENGLAND] European communications company KPNQwest announced Thursday that its 2000 revenues were up 103 percent over those in 1999, while losses also doubled from EUR 69.0 million (US $64 million) to EUR 138.6 million (US $129 million).
Anyone getting a sense of déjà vu will recall that Wednesday's figures from Germany's T-Online showed revenues up by 86 percent with losses of US $116.5 million.
Jack McMaster, president and chief executive of KPNQwest, said his company had not only recorded substantial revenue growth and built its market share across Europe, but at the same time had completed the biggest phase of its pan-European fiber optic construction project.
KPNQwest's number of business Internet accounts grew by 31 percent over 1999 to over a hundred thousand. It also saw a fourfold increase in demand for its hosting and other CyberCentre services, major deals with companies such as Nokia, Atos Origin and Fast Search & Transfer helping to swell the figures.
In fact, by the end of 2000, KPNQwest had grown its Global Accounts business from zero in 1999 to annualized revenues of over EUR 125 million (US $116 million), serving over 200 customers.
One of KPNQwest's biggest deals recently has been the sale to Dell Computer of a 21-site IP VPN linking Europe, South Africa and the United States. This Dutch-U.S. venture, announced at the beginning of January, is said to be the largest of its type.
In summary, KPNQwest's total revenue for the twelve-month period ended December 31, 2000 was EUR 461.6 million (US $429.3 million). Its fourth quarter revenue was EUR 144.5 million (US $134.4 million), an increase of approximately 78.4 percent compared to the same period in 1999.
Willem Ackermans, executive vice president and chief financial officer, called it a "strong financial performance in all of Europe's data growth markets."
"Furthermore, our recent successful high yield bond offering of EUR 500 million will give us the additional flexibility to continue the growth trajectory we demonstrated in 2000 towards EDITDA breakeven by the end of 2001," added Ackermans.
The promised land of EDITDA breakeven -- non-negative net income before depreciation, amortization, interest expense and income taxes -- is one that many European Internet companies will be seeking in 2001. KPNQwest is among those likely to achieve it.