Andover, Massachusetts – (The Hosting News) – October 26, 2005 – Data center and IT web hosting company, NaviSite, Inc., has reported financial results for its
fourth quarter and fiscal year 2005, which ended July 31, 2005.
NaviSite recorded $3.8 million of positive EBITDA, excluding impairment and other one-time charges for the fourth quarter of fiscal year 2005, which marked the Company’s eighth consecutive quarter of positive EBITDA, increasing from $3.3 million in the third fiscal quarter of 2005, $2.6 million in the second fiscal quarter of 2005 and $1.3 million in the first fiscal quarter of 2005. NaviSite’s EBITDA, excluding impairment and other one-time charges, for the same period last year was $0.1 million. The Company completed fiscal year 2005 with $10.9 million in EBITDA, excluding impairment and one-time charges, compared to $4.7 million for fiscal year 2004, a 130% increase. The Company decreased its net loss to $1.5 million for the fourth quarter of fiscal year 2005, as compared with a net loss of $11.5 million for the same quarter of fiscal year 2004.
Revenue for the fourth quarter of fiscal year 2005 was $25.8 million, compared to $25.2 million for the fourth quarter of fiscal year 2004. Sequentially, as compared to the third quarter of fiscal year 2005, revenue declined 3.7%. Revenue for fiscal year 2005 was $109.9 million, a 21% increase over revenue of $91.2 million in fiscal year 2004. NaviSite generated gross profit of $7.9 million for the fourth quarter of fiscal year 2005, or 31% of revenue, compared to $5.4 million, or 22% of revenue, for the same fiscal quarter of 2004. The Company closed fiscal year 2005 with gross profit of $29.3 million, or 27% of revenue, compared to $21.9 million, or 24% of revenue, in fiscal year 2004.
NaviSite generated positive cash flow during the fourth quarter of fiscal year 2005, ending with $6.8 million of cash at July 31, 2005, an increase of $5.3 million from the end of the third quarter of fiscal year 2005. The Company attributes this increase in cash during the fourth quarter to the sale of the Microsoft Business Solutions practice and the positive cash flow from operations during the quarter.
The Company reported a net loss of $1.5 million, or $0.05 per share, for the fourth quarter of fiscal year 2005, as compared with a net loss of $11.5 million, or $0.43 per share, for the same quarter of fiscal year 2004. Net loss for fiscal year 2005 was $15.7 million, as compared with a net loss of $21.4 million for fiscal year 2004. Net loss per share decreased to $0.56 for fiscal year 2005, as compared with a net loss per share of $0.85 for fiscal year 2004. The Company continued to increase its cost efficiencies as demonstrated in the decreased net loss and net loss per share.
According to Arthur Becker, CEO of NaviSite, ”We are pleased to mark record EBITDA for both the quarter and the year. Our focus in 2005 was to complete the integration of the prior acquisitions and to position ourselves for significant revenue growth as we enter fiscal year 2006. We’ve structured our business units to drive revenue growth in each of the focus areas of Hosting Services, Outsourcing Services and Professional Services and invested in strategic hires to fulfill this strategy. We project revenue for the first quarter of fiscal year 2006 to be between $25.1 and $25.5 million, which represents growth of 2% over Q4 2005, excluding the impact of the sale of our Microsoft Business Solutions practice. Despite projected revenue growth in the first quarter of 2006, EBITDA, excluding impairment and one-time charges, is projected to be between $2.6 and $3.0 million for the first quarter of fiscal year 2006, reflecting the planned investments in key hires for professional services to drive revenue and EBITDA in subsequent quarters.”
NaviSite provides IT hosting, outsourcing and professional services for mid- to large-sized organizations. NaviSite operates 15 state-of-the-art data centers and eight major office locations across the U.S., U.K. and India. For more information, please visit www.navisite.com.