Cogent has been raising its dividend every quarter since it started returning cash to shareholders, but this quarter saw the biggest boost yet. In terms of their quarterly numbers, revenue and earnings per share came in lighter than expected, while EBITDA and margins were stronger than anticipated.
| $ in millions | Q2/13 | Q3/13 | Q4/13 | Q1/14 | Q2/14 |
|---|---|---|---|---|---|
| – On-net | 62.7 | 64.5 | 66.0 | 69.1 | 70.4 |
| – Off-net | 22.6 | 22.8 | 23.4 | 23.5 | 23.9 |
| – Other | 0.5 | 0.4 | 0.4 | 0.4 | 0.4 |
| Revenue | 85.8 | 87.8 | 89.9 | 92.9 | 94.6 |
| EBITDA | 29.6 | 30.7 | 31.5 | 32.1 | 33.5 |
| Earnings per share | 0.03 | 0.05 | 1.10 | 0.00 | 0.03 |
| Gross Margin | 56.9% | 57.5% | 57.4% | 57.4% | 58.3% |
| Adj. EBITDA Margin | 34.5% | 35.0% | 35.0% | 34.6% | 35.4% |
| On-net Buildings | 1921 | 1955 | 1990 | 2024 | 2057 |
| Employees | 633 | 673 | 706 | 724 | 760 |
The street was looking for something more like $95-96M in revenue and $0.06 in EPS, at least according to Yahoo! Finance, so the stock probably won’t have a fun morning. But EBITDA growth was quite strong, and given the ongoing shift of Netflix traffic to paid peering arrangements I wasn’t expecting revenue to fare that well. I’ll be curious to hear what the company says about that situation on the call.
And as for the quarterly dividend, for Q3 Cogent boosted that all the way up to $0.30 per share, a 77% jump sequentially and 114% over the same quarter last year. During Q2 they also bought back $17.9M worth of their own stock, and they have now authorized an additional $50M for stock buybacks.
Operationally, Cogent added another 33 buildings to its network and increased headcount to 760. Headcount is up nearly 17% over last summer, I wonder what they’re up to on that front.
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Categories: Financials · Internet Backbones · Metro fiber
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They are selling shoddy internet equipment to whom, and needing to buy new equipment to replace it for how much? And, analysts are giving them credit for these old equipment sales as “revenue”? I am starting to get a fishy smell like Joe Nacchio, I was not a crook, from Qwest. I would guess CSCO is behind these accounting machinations. imo
Don’t know about criminal, but Cogent has always been the absolute low rent leech of the network biz. God hasten their demise.