Broadwing logs best quarter

Broadwing, soon to become part of Level 3 Communications, posted its strongest quarter to date, with an increase in revenues and adjusted EBITDA, and a narrowing of both operating and net losses.

The company’s growth was based largely on its sale of broadband data and Internet services on its converged network platform, said Chief Executive Office Stephen E. Courter.

“We are very pleased with the quarter,” Courter said. “We had total revenue growth of six percent. Our strong top-line growth was driven largely by sales of data and broadband services. We had year-over-year revenue increases in every product category other than a small decrease in long distance voice.”

Broadwing had positive adjusted EBITDA of $8 million for the quarter bringing the year to date to $16 million, following three years of negative adjusted EBITDA, he said. The company’s third quarter net loss was $16.8 million or 19 cents per share versus a net loss of $30.5 million or 41 cents per share in the year-previous quarter. Revenues rose to $231.9 million from $218.66 million in the third quarter of 2005.

Broadwing Chief Financial Officer Lynn Anderson credited the company’s improving performance to a leadership team which was “willing to put in the creative energy and hard work” and said the “strong revenue growth and adjusted EBITDA are proof that the Broadwing business is very solid.”

Courter, who joined Broadwing as CEO in July, said he hadn’t come aboard to sell the company but felt the Level 3 Communications offer of $15.31 per Broadwing share, a 15% premium over the stock price at the time, was too good to pass up. “It was a good offer, with a large cash component,” said Courter, whose stock option package was one reason the company’s net loss expanded from the second quarter to the third quarter. “The strategic objective was to grow this business. We weren’t out there looking for an acquistion.”