Zayo Marches On, Posts Steady Fiscal Q2

February 6th, 2014 by · 16 Comments

Steady revenue growth, some organic some inorganic, steady margin expansion, and plenty of new on-net buildings marked Zayo's fiscal second quarter.   Here are their numbers in some context:

$ in millions Fiscal
Q3/13
Fiscal
Q4/13
Fiscal
Q1/14
Fiscal
Q2/14
 - Wavelength 60.7 62.1 63.3 64.4
 - Sonet 32.5 31.9 31.6 30.2
 - Ethernet 33.8 35.3 36.1 37.6
 - IP 23.0 23.1 23.8 24.7
 - Mobile Infrastructure 17.5 19.0 18.9 19.8
 - zColo 15.9 16.7 18.9 20.9
 - Dark Fiber 74.9 77.1 78.9 83.6
Total Revenue 251.4 258.2 264.3 273.6
Adjusted EBITDA 146.1 141.7 155.4 161.5
Adj. EBITDA Margin 58.1% 54.9% 58.7% 59.0%
Capex 95.7 101.9 86.7 88.3
Buildings on-net 11,740 12,222 13,242 14,196

The company closed both the Access Communications and Fiberlink deals near the start of the quarter, with adjusted EBITDA multiples of 12.3 and 11.7, respectively, according to the earnings supplement.  The two acquistions combined added perhaps a third of the company's incremental revenue growth, with the rest coming from organic growth.  Margins expanded up to 59%, putting the 60% barrier within reach before long if they keep up the pace.

The extensive segment breakdown has enough data to see the product trends.  The only downward trend is clearly Sonet, with zColo, Ethernet, and Mobile having very good quarters.  Dark fiber is where most of the acquire revenue went I think, but I will listen for that on the call.

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Categories: Fiber Networks · Financials · Metro fiber

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16 Comments So Far


  • steve says:

    how do you say “SMOKE AND MIRRORS”?

  • MARK says:

    BULLSHEET… Caruso = Corrupto

  • Anonymous says:

    So when are they buying eunetworks?

  • Dan Caruso says:

    steve and MARK, I’m happy to step through our earning supplement with either or both of you. We go out of our way to provide data in an objective and transparent way. Some of the trends are good, some neutral, and some not-so-good. However, anyone who takes time to study the data will know that we are not “smoke and mirrors” or “corrupto”. Email me and we can set up a time to discuss.

    • ChrisP says:

      Dan – I appreciate the decks your team puts out. I look to them every quarter to monitor industry trends. While I sometimes question who makes your graphs :), I do appreciate the amount of data Zayo is willing to share.

    • Mark says:

      maybe that was a bit harsh.

      • Steve Jobs says:

        Come on do you really think that CEO Dan Caruso would really waste or have time to respond to a telecom blog?

        • Dan Caruso says:

          “Steve Jobs” — this is authentic… I haven’t yet seen a post from someone pretending to be me. If you doubt it, please send me an email… I appreciate the raw feedback that often comes from Blogs (and glassdoor.com) even if some of the messages are hard to read. I view it as a type of Crowd Sourcing, helping me understand what others are seeing.

  • Melissa says:

    Steve Jobs often responded to the complaints and/or concerns of his customers online. Dan Caruso actively participates in the conversations on TR.

    Mark – Oh that wily internet. Easy to be a troll when you don’t think the person you’re talking about is actually listening.

    • Anonymous says:

      I’m pretty sure that Steve Jobs didn’t respond to complaints and/or concerns of his customers online. I think he occasionally responded to emails (typically with one word quips, like “yep”, “no”)

      Steve was such an icon that these email replies got published on blogs by the recipients (kinda like getting an autograph)

      • Steve Jobs' Ghost says:

        Oh that wily internet. Easy to be a troll when you don’t know that Steve Jobs’ Ghost is listening. Steve Jobs would roll over in his grave if he heard that people thought he trolled and responded to blogs.

  • Anonymous says:

    How dare you not worship him

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