Press Release
D&E COMMUNICATIONS, INC. FOR IMMEDIATE RELEASE Aug 09, 2006 | FOR IMMEDIATE RELEASE CONTACT PERSON: |
EPHRATA, PENNSYLVANIA (August 9, 2006) - D&E Communications, Inc. ("D&E" or "Company") (Nasdaq: DECC), a leading provider of integrated communications services in central and eastern Pennsylvania, today announced the results of its operations for the second quarter and six months ended June 30, 2006.
For the second quarter of 2006, the Company reported total operating revenue of $43.5 million, as compared to $44.0 million in the second quarter of 2005. Net income for the second quarter was $0.9 million, or $0.06 per share, as compared to $1.4 million, or $0.10 per share, for the same period last year. The primary reason for the decrease in net income was a non-cash $2.4 million ($1.4 million, or $0.10 per share, after tax) customer relationships intangible asset impairment loss recognized in the Systems Integration segment, offset by a $1.9 million reduction in other operating expenses. Net income before the intangible asset impairment loss was $2.3 million, or $0.16 per share, for the quarter ended June 30, 2006.
For the six months ended June 30, 2006, the Company reported total operating revenue of $86.2 million, as compared to $86.9 million in the same period last year. Net income for the six months ended June 30, 2006 was $2.5 million, or $0.18 per share, as compared to $4.3 million, or $0.30 per share, for the same period last year. Included in the 2006 results was the customer relationships intangible asset impairment loss of $2.4 million ($1.4 million, or $0.10 per share, after tax.) Included in the 2005 results was a gain on investment of $2.0 million ($1.3 million, or $0.09 per share, after tax) from the sale of our ownership interest in PenTeleData. Net income before these items was $3.9 million, or $0.28 per share, for the six months ended June 30, 2006, compared to $3.0 million, or $0.21 per share, for the six months ended June 30, 2005.
Jim Morozzi, D&E's President and CEO stated, "We continue to be pleased with the direction of the Company. Our emphasis for 2006 has been on broadband growth and on increasing the number of on-net CLEC customers. We have been successful in doing that. We have also taken steps to minimize the effects of the continuing competitive pressures facing the RLEC segment. Although there remains much work to be done in our Systems Integration business, we are seeing progress. We have reduced expenses and sharpened our focus on our Managed Services, such as network performance monitoring, and Professional Services lines of business. We will continue with these efforts as we strive to bring profitability to this business segment."
Morozzi also noted, "I am happy to report that operating income, excluding the intangible asset impairment loss, for both the second quarter and the first six months of 2006 show marked improvement over 2005. Our employees are working diligently to Deliver Excellence to our customers and our shareholders."
Summary Statistics
June 30, 2006 | June 30,2005 | Change | % Change | |
RLEC lines | 132,010 | 136,929 | (4,919) | (3.6%) |
CLEC lines | 41,599 | 39,381 | 2,218 | 5.6% |
DSL/High-Speed Internet subscribers | 24,581 | 14,797 | 9,784 | 66.1% |
Dial-up Internet subscribers | 6,560 | 10,082 | (3,522) | (34.9%) |
Video subscribers | 6,300 | 5,504 | 796 | 14.5% |
Web-hosting customers | 931 | 929 | 2 | 0.2% |
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