Press Release
D&E COMMUNICATIONS, INC. FOR IMMEDIATE RELEASE March 14, 2006 | NEWS RELEASE CONTACT PERSON: |
EPHRATA, PENNSYLVANIA (March 14, 2006) - D&E Communications, Inc. ("D&E") (Nasdaq: DECC), a leading provider of integrated communications services in central and eastern Pennsylvania, today announced the results of its operations for the fourth quarter and year ended December 31, 2005.
For the fourth quarter of 2005 the company reported total operating revenue of $45.1 million, as compared to $44.7 million in the fourth quarter of 2004. Net income for the fourth quarter was $7.1 million, or $0.49 per share, as compared to a net loss of $2.4 million, or ($0.17) per share, for the same period last year. Included in the fourth quarter 2005 results was income of $6.4 million ($6.0 million, or $0.42 per common share, after tax) from the sale of the company's direct and indirect investment in Pilicka Telefonia Sp. z o.o. ("Pilicka") on December 19, 2005. Results for the fourth quarter 2004 included a loss of $2.1 million ($2.1 million, or ($0.14) per common share, after tax) for our share of an impairment of assets at Pilicka and an impairment of our investment in EuroTel.
Total operating revenue for the full year 2005 was $176.2 million, as compared to $176.3 million for the previous year. Net income for the year was $13.7 million, or $0.96 per share, as compared to a net loss of $2.7 million, or ($0.18) per share, for 2004. Results for 2005 include income of $6.4 million ($6.0 million, or $0.42 per common share, after tax) from the sale of the company's direct and indirect investment in Pilicka, a gain on investment of $2.0 million ($1.3 million, or $0.09 per common share, after tax) from the sale of our interest in PenTeleData and other income of $2.1 million ($1.2 million, or $0.08 per common share, after tax) from interest and principal payments collected on the note received from the sale of assets of Conestoga Wireless. Included in the 2004 results is a loss of $5.3 million ($3.6 million, or ($0.24) per common share, after tax) on early extinguishment of debt related to the company's refinancing of its debt in March and November 2004, a loss of $2.1 million ($2.1 million, or ($0.14) per common share after tax) for our share of an impairment of assets at Pilicka and an impairment of our investment in EuroTel, and other income of $0.8 million ($0.5 million, or $0.03 per common share, after tax) from interest and principal payments collected on the note received from the sale of assets of Conestoga Wireless. Net income before these items was $5.2 million, or $0.37 per share, for the year ended December 31, 2005, compared to $2.5 million, or $0.17 per share, for the year ended December 31, 2004.
"This has been a very good year for D&E Communications," said D&E President and CEO, James Morozzi. "We are confident that we have taken the right steps toward changing our business model to enable us to continue to make strides and refine ways to move the company forward. We have intensified our focus on broadband deployment, in both the RLEC and CLEC business, and in managing our overall costs. We strongly believe that delivering the broadband connection to the customers' homes and businesses is a key element to our future success. In 2005, we had exceptional success in broadband growth with an 80% increase over 2004. Overall, the RLEC segment has performed as expected, and we continue to be alert to the competition in that segment. Broadband and CLEC growth, particularly on-net CLEC customer growth, has and will continue to enable us to move forward in a positive direction. In our Systems Integration segment wea^?(TM)ve put more focus on professional and managed services which provide recurring revenues and on cutting costs in that segment."
Summary Statistics
| December 31, 2005 | December 31,2004 | Change | %Change | |
| RLEC lines | 134,698 | 139,607 | (4,909) | (3.5%) |
| CLEC lines | 40,796 | 38,461 | 2,335 | 6.1% |
| DSL Subscribers | 19,795 | 11,015 | 8,780 | 79.7% |
| Dial-up Internet subscribers | 7,959 | 11,535 | (3,576) | (31.0%) |
| Video subscribers | 6,630 | 5,498 | 1,132 | 20.6% |
| Web hosting customers | 952 | 909 | 43 | 4.7% |
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