Exhibit 99.1
Globix Corporation Reports First Fiscal Quarter 2004 Results
NEW YORK - February 6, 2004
New York - February 6, 2004 - Globix Corporation (OTC: GBXX) today reported
financial results for its first quarter of fiscal year 2004, which ended
December 31, 2003, citing continued progress in its operations. During the 1st
quarter of fiscal 2004, Globix furthered its transformation into a full service
application, media and infrastructure services company with the completion of
its acquisition of Aptegrity, a privately held managed services provider. Globix
also took further steps to reduce its debt by completing the sale of its
property at 415 Greenwich Street in New York City during January 2004 for net
cash proceeds of approximately $48.5 million. The company intends to use
approximately $44 million of the net proceeds to repurchase a portion of its
outstanding 11% Senior Notes at par plus accrued interest and the remaining
balance will be used for working capital purposes. The company also announced
that it had repurchased an additional $7.0 million of its outstanding 11% Senior
Notes during the 1st quarter of fiscal 2004.
Revenues for the quarter were $14.4 million, which was $2.1 million, or 12.7%
less than the same period in 2003. Additionally, Globix increased its revenue in
the first quarter 2004 over the fourth quarter of 2003, as a result of stronger
sales. The company also reported that in the first fiscal quarter of 2004 cost
of revenues was reduced 13.3% to $4.9 million from the same period in 2003, and
that sales, general and administrative costs were reduced 8.0% to $10.9 million
compared to the same period in 2003 primarily reflecting the continuing impact
of the company's cost management efforts.
Loss from operations was $22.1 million for the first fiscal quarter of 2004,
compared to a loss of $4.8 million for the same period a year earlier. This was
due primarily to the $17.3 million non-cash impairment charge on the company's
415 Greenwich street property. Net loss for the quarter was $23.3 million, or
$1.42 per share, based on 16,460,000 common shares outstanding at the end of the
quarter.
Globix Corporation & Subsidiaries
Unaudited Condensed Results of Operations
(Amounts in Thousands Except Share and Per Share Data)
For the Three Months Ended
-----------------------------------
December 31, December 31,
2003 2002
---------------- ---------------
Revenue, net .............................................................. $ 14,385 $ 16,480
Operating costs and expenses:
Cost of revenue (excluding depreciation, amortization, and certain
payroll and occupancy shown below) .................................. 4,876 5,624
Selling, general and administrative ................................... 10,944 11,891
Loss on impairment of property held for sale .......................... 17,313 --
Depreciation and amortization ......................................... 3,371 3,727
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Total operating costs and expenses ..................... 36,504 21,242
Loss from operations ...................................................... (22,119) (4,762)
Interest and financing expense ........................................ (3,453) (3,904)
Interest income ....................................................... 179 388
Other (expense) income, net ........................................... 297 182
Gain on discharge of debt.............................................. 1,747 2,727
Minority interest in subsidiary ....................................... -- 108
---------------- ---------------
Net loss................................................................... $ (23,349) $ (5,261)
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Basic and diluted loss per share........................................... $ (1.42) $ (0.32)
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Weighted average common shares outstanding - basic and diluted............. 16,460,000 16,460,000
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About Globix:
Globix ( http://www.globix.com) (GBXX) is a leading provider of managed Internet
applications and infrastructure services for enterprises. Globix delivers and
supports mission-critical applications and services via its secure Data Centers,
high-performance global Tier 1 IP backbone, and content delivery network.
Through Aptegrity, its managed services group, Globix provides remote management
of custom and off-the-shelf Web-based applications on any server, anywhere, at
any time. By managing such complex e-commerce, database, content management and
customer relationship management software for its clients, Globix helps them to
protect Internet revenue streams, reduce technology operating costs and
operating risk, and improve user satisfaction. Globix's clients are companies
which use the Internet as a way to provide business benefits and sustain a
competitive advantage in their markets. Our clients include operating divisions
of Fortune 100 companies as well as mid-sized enterprises in a number of
vertical markets including health care, media and publishing, technology and
financial services. Globix and its subsidiaries have operations in New York,
London, Santa Clara, Fairfield, New Jersey and Atlanta.
Risk Factors and Forward-Looking Statements:
This press release contains forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934. These statements are based
on current information and expectations and are subject to risks and
uncertainties that could cause the company's actual results to differ materially
from those expressed or implied in the forward-looking statements. These risks
and uncertainties include: the company's ability to retain existing customers
and attract new customers; its ability to match its operating cost structure
with revenue to achieve positive cash flow; the sufficiency of existing cash and
cash flow to complete the company's business plan and fund its working capital
requirements; the insolvency of vendors and other parties critical to the
company's business; the company's existing debt obligations and history of
operating losses; its ability to integrate, operate and upgrade or downgrade its
network; the company's ability to recruit and retain qualified personnel needed
to staff its operations; potential market or technological changes that could
render the company's products or services obsolete; changes in the regulatory
environment; and other changes that are discussed in the company's Annual Report
on Form 10-K and other documents that the company files with the Securities and
Exchange Commission.
Press Contact:
Michael van Dijken
212-625-7546
mvandijken@globix,com