As it continues to integrate last year’s acquisitions into its business, Zayo is redefining the possible EBITDA margin potential for the fiber sector. In today’s quarterly earnings numbers, they saw sequential growth in EBITDA that exceeded that of revenue in gross terms, bringing margins up to 58.1%. Here’s a quick table of their numbers in context:
|$ in millions||Fiscal
|– Zayo Bandwidth||74.8||76.4||152.1||158.7||167.6|
|– Zayo Fiber Solutions||19.6||22.7||65.9||71.5||74.9|
|Adj. EBITDA Margin||51.3%||52.4%||53.4%||56.4%||58.1%|
Revenues grew 3.2% sequentially, but some of that came from the full quarter’s contribution from the First Telecom and Litecast acquisitions. Going forward, they are futher bifurcating their reporting of what used to be Zayo Bandwidth, but is now Zayo Waves, Zayo Sonet, Zayo Ethernet, Zayo IP, and Zayo MIG. (That last one stands for Mobile Infrastructure Group.) I’ll start tracking those independently next quarter.
Operationally, Zayo spent $95.7M in capex while bringing 636 building on-net – a big number by any measure and all organic. That gives them 11,740 in all now, of which 3,045 are now cell towers.
While the SEC filings are out, the earnings supplement with further detail is not – will wait for the call for any further details.
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