Key acquisitions and a bit of churn in its bandwidth unit played roles in Zayo Group's generating a modest $58.9 million in revenue for Q1 2010, about $700,000 more than Q4 09 and a 5 percent annualized increase. However, the bandwidth and network infrastructure service provider carefully pointed out that its revenue increased $20.5 million over the third quarter of 2009 and that compared to the first quarter of 2009 revenues rose 53 percent, from $38.4 million.
The Colorado-based company reported results for all three of its business units: Zayo Bandwidth, Zayo Enterprise Networks, and Zayo Colocation (zColo).
Zayo Bandwidth's purchase of FiberNet in September 2009 led to an average monthly churn rate of 1.7 percent, the company stated, due to the lower gross profit margin on the off-net transport business inherited from FiberNet. The unit generated $45.5 million in revenue in the first quarter, with a gross profit of $32.1 million and adjusted EBITDA of $17.5 million.
Zayo Enterprise Networks posted revenues for the quarter of $8.8 million, and zColo reported $6.9 million in revenue.
The company spun off its subsidiary Onvoy Voice Services to an unrestricted parent holding company in early March and on March 23 announced it will acquire dark fiber provider AGL Networks, a purchase expected to be finalized sometime this summer.
- see the release
Zayo snaps up AGL Resources' dark fiber business
Zayo Enterprise Networks puts fiber in Denver businesses' diet
Zayo to acquire interconnect firm FiberNet