TORONTO – Broadband service provider TeraGo Networks reported a net loss of $12.4 million for its 2008 fiscal year, nearly $7 million more than its net loss in 2007.
The company explained the increase as due in part to increased future income tax expenses of $2.6 million recorded in the fourth quarter of 2008, and an increase in amortization of property, equipment and network assets of $2.7 million.
TeraGo’s total revenue was $31 million for the year ended December 31, 2008, an increase of $5.9 million or 23% compared with $25.1 million of revenue in 2007.
The increase in revenue is primarily the result of more customer locations in service, and existing customers upgrading their Internet and data connections and/or adding additional service locations, the press release explained. Service revenues, often recurring in nature, comprised 98% of total revenues and installation revenue was 2%.
Gross profit was $23.1 million in 2008, representing 74.4% of revenues, compared to $19.3 million or 76.7% of revenue in 2007.
LBITDA (losses before interest, taxes, depreciation and amortization) was $0.4 million in 2008, compared to EBITDA of $1.5 million in 2007, due to investments in market expansion and associated sales and operations personnel. The company said that EBITDA began to improve on a sequential basis in the third quarter of 2008, and in the fourth quarter, EBITDA returned to a positive result of $0.6 million, compared to $0.01 million in the fourth quarter of 2007.
"We maintained a solid revenue growth rate in the fourth quarter and also delivered significant sequential improvement in EBITDA despite the economic slowdown," said president and CEO Bryan Boyd, in the release. "TeraGo is well positioned with a strong balance sheet having no debt and significant cash resources."
TeraGo’s total customer locations in service reached 4,522 by the end of 2008, an increase of 745 net new locations, or 20%, compared to 3,777 customer locations in service at the end of 2007. It’s average monthly revenue per customer location (ARPU) increased 2% to $604 in fiscal 2008, from $594 in 2007.
