Iowa Telecom access lines down, DSL up

Iowa Telecom posted lower revenue and operating income, as its access lines also continued to decline. The company announced revenue of $58 million, down almost 8% from the second quarter of 2004, but attributed the decrease to one-time revenue recognized a year ago.

Net income decreased $3.2 million, or 19.2%, to $13.3 million in the second quarter of 2005 compared to the same period in 2004. Adjusted EBITDA was down $7.8 million.

In the second quarter of 2004, Iowa Telecom recognized $7.7 million in local service revenue that had been previously collected but held for possible refund.

The service provider had a net loss of access lines of 2,200 or less than one percent as its incumbent access lines fell by 11,300 while CLEC access lines grew by 9,100. The company added 12,700 DSL subscribers, a 128% increase, and its average revenue per customer went up by 4 dollars to $73.

“We're pleased with our solid second quarter financial results, as revenue, operating income, net income and Adjusted EBITDA were higher than in the first quarter of 2005,” said Alan L. Wells, Iowa Telecom president and chief executive officer. “Throughout the first six months of this year we have performed well, and our results reflect our strategy of being very cash flow focused. Our DSL High-Speed Internet service offering continues to do well, as we added 3,000 net subscribers for the second quarter. We continue to be successful in using our strong incumbent market position to increase revenue per access line by providing additional services to our customers.”