Alaska Communications Systems Group Inc (NASDAQ:ALSK) stock plummeted by close to 16.4 percent during trading on 7th March on the back of lower than expected results, the firm reported for its full year 2014 and 4Q13 operations. Its earnings before taxes were $106 million for the fiscal year.
Full Year Highlights – Skewed Compares From FY112 Casts Shadow
The firm reported revenue of $348.9 million, which was almost $15.7 million less than last year. The substantive dip in revenue was caused; do to the sale of its AWN business in July of 2013. The revenue stream stoppage from this segment created a big void in the cash flow for the full year. Last year’s revenue compare was also inflated due to inclusion of close to $3 million which was generated by sale of equipment and signing of a bulk order with a wireless operator.
On the positive side, revenue from its cash cow business segment “Services” was up by 2.9 percent in 4Q, where as Broadband business grew by 18.6 percent in 4Q in comparison to FY12.
CEO Wants To Look Ahead
Commenting about the mixed results from the fourth quarter operations, Alaska Communications Systems Group Inc (NASDAQ:ALSK) President and CEO Anand Vadapalli has been quoted to have said that, “We generated strong growth in business and wholesale revenues, driven by continued performance in our broadband products. We see this momentum continuing into 2014. Additionally, we also delivered significant value through debt reductions of $105.6 million during the year. Our confidence in the market opportunity remains strong and we are well positioned for solid performance in 2014.”
New Revenue Stream Expected To Increase Cash Flow
The CEO also painted a positive prospect for its 2014 operations. He pointed out that the recent acquisition of company called TekMate, is going to add incrementally to its recurring revenue in the form of monthly payments from its managed services business.