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EarthLink shares fall sharply after Q4 results

Rochester Business Journal
February 19, 2013

EarthLink Inc. reported a net loss for the fourth quarter as its revenues declined.

The telecommunications and information technology service provider posted a net loss of $9,000, or zero cents a share, down from a net profit of $4.1 million, or 4 cents a share, during the period a year ago.

EarthLink logged revenues of $331.6 million for the quarter, down from $350.2 million in fourth quarter 2011.

The company’s full-year 2012 net income fell to $7.5 million, or 7 cents a share, from $34.6 million, or 32 cents a share, in 2011. Revenues for the full year were $1.35 billion, up from $1.31 billion.

EarthLink also announced Tuesday it plans to refinance its debt to cut interest expenses.

The company also released projections for 2013, anticipating a loss of $40 million to $45 million on revenues of $1.25 billion to $1.27 billion.

CEO Rolla Huff said he was happy with the company’s progress in transitioning from an Internet service provider to a provider of IT services such as data storage and network infrastructure.

“We continue to accelerate our transformation to a nationwide provider of IT services,” he said. “To capitalize on the growing demand in this rapidly emerging marketplace, we are also continuing the process of optimizing the cost structure in our traditional telecom services, while aggressively investing in our IT services (and other businesses).”

Shares of EarthLink (NasdaqGS: ELNK) fell more than 10 percent by late afternoon Tuesday to $6.22 a share.

(c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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