Exhibit 99.1
FOR IMMEDIATE RELEASE
COVISTA COMMUNICATIONS, INC., RELEASES RESULTS
FOR THE THREE MONTHS ENDED APRIL 30, 2004
Chattanooga, TN, June 11, 2004 - Covista Communications, Inc. (NASDAQ Symbol:
CVST), today announced its first fiscal quarter results.
For the first quarter of fiscal year 2005 which ended April 30, 2004, Covista
Communications, Inc. reported revenue of $18,194,305 as compared to revenue of
$23,269,857 for the prior year's first fiscal quarter and a loss of $1,999,775
or $.11 per share compared with a loss of $777,801 or $.04 per share for the
prior year's first fiscal quarter.
The overall revenue decrease is primarily related to the decline the retail
commercial segment, partially offset by moderate growth in the KISS residential
segment. The retail commercial segment continues to experience competitive
pressure from other providers, especially those having the ability to bundle
local dial tone with traditional long distance offerings. While Covista has
recently launched local services to retail commercial customers in certain
markets, the Company has experienced the loss of retail commercial customers to
other competitive providers. The Company has recently announced the signing of a
definitive agreement to sell the majority of its retail commercial customer base
to another Company.
The increase in the KISS segment is primarily attributed to the marketing of
local service to its residential users in selected markets in addition to direct
marketing via mail and web based affinity-marketing campaigns. While the Company
has launched local services to the KISS residential segment in certain markets,
it plans to expand the number of markets in which it may offer its local and
long distance bundled product offering.
John Leach, Jr., Covista's President and Chief Executive Officer, stated, "While
we have made solid progress with our local and long distance bundled service
offering to our KISS residential segment, we experienced disappointing results
from our commercial segment. We will continue to focus on growing the
residential base and our recent announcement regarding the pending sale of the
majority of our commercial operations will assist with those plans."
We are providing the following consolidated summary of operations (unaudited)
for the three months ended April 30, 2004 and 2003 (amounts and number of shares
in thousands except for share data):
QUARTER ENDED APRIL 30
2004 2003
---- ----
Revenue $ 18,194 $23,270
Cost & Expense 20,102 23,972
Operating Loss (1,908) (702)
Other Expense (92) (76)
Net Loss (2,000) (778)
Basic Loss per Common Share $ (0.11) $(0.04)
Diluted Loss Common Share $ (0.11) $(0.04)
Average Number of Common Shares
Basic 17,822 17,783
Diluted 17,822 17,783
About Covista:
Covista is a facilities-based provider of telecommunications services with a
substantial customer base, principally residential and small to medium sized
businesses. Its products and services include a broad range of voice, data and
Internet solutions, including long distance and toll-free services, local dial
tone and features, calling cards, frame relay, Internet access, VPN, directory
assistance and teleconferencing services. Covista currently owns and operates
switches in Chattanooga, Dallas and Minneapolis, as well as in New York City and
Philadelphia, which are to be sold to PAETEC. Covista operates Network
Operation; call center and information technology facilities in Chattanooga to
monitor its switched network and to coordinate its various services. For
information on becoming a Covista customer, please telephone 800-805-1000 or
visit the Company's website at www.covista.com.
Information relating to forward-looking statements:
This press release contains historical and forward-looking statements made
pursuant to the safe harbor provisions of the private securities litigation act
of 1995. Investors are cautioned that forward-looking statements such as
statements of the company's plans, objectives, expectations and intentions
involve risks and uncertainties. The cautionary statements made in this release
should be read as being applicable to all related statements wherever they
appear. Statements containing terms such as "believes," "expects," "plans,"
"projects," "intends," "estimates," "anticipates," or similar terms, are
considered to contain uncertainty and are forward-looking statements. The actual
results could differ materially from those discussed. Factors that could
contribute to such differences include: changes in market conditions and
increased competition from other telecommunications and internet service
providers; government regulations; the volatile and competitive environment for
internet telephony; advances in competitive products or technologies that could
reduce demand for services; availability of transmission facilities; management
of rapid growth; customer concentration and attrition; the ability to
successfully develop and bring new services to market; inaccurate or incomplete
assumptions on the part of management; dependence on the availability and
functionality of local exchange carriers' networks as they relate to the
unbundled network element platform; failure of the marketing of the bundle of
local and long distance services and long distance services; attrition in the
number of end users; failure or difficulties in managing our operations;
including attracting and retaining qualified personnel; failure to be able to
expand our active offering of local bundled services in a greater number of
states; failure to provide timely and accurate billing information to customers;
failure to manage our collection management systems and credit controls for
customers; interruption in our network and information systems; failure to
provide adequate customer service; and changes in government policy, regulation
and enforcement and/or adverse judicial or administrative interpretations and
rulings relating to regulations and enforcement, including, but not limited to,
the continued availability of the unbundled network element platform of the
local exchange carriers network and unbundled network element pricing
methodology, and other risks discussed in the company's SEC filings, including
form 10-k and form 10-q, which can be accessed at the SEC web site at
www.sec.gov.
Readers of this release should understand that it is not possible to predict or
identify all such risk factors. Consequently, this list should not be considered
a complete statement of all potential risks or uncertainties. Covista does not
assume the obligation to update any forward-looking statement, except as is
required by applicable law.
Contact:
Thomas Gunning
Corporate Secretary
Covista Communications, Inc.
Tel: (201) 599-6464
Fax: (201) 599-9017
E-mail: tgunning@covista.com