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Integra Plans for ‘Modest’ Growth

Integra Telecom on Tuesday said it anticipates "modest" growth in its revenues this year as the company returns to positive free cash flow.

But the company projects that revenues will grow in the mid to upper single digits from 2013 through 2015.

In an investor presentation at a JP Morgan conference, Integra projects $75 million in unlevered cash flow in 2012. Unlevered free cash flow, according to Investopedia, reflects cash on hand to pay for operations before other financial obligations are considered.

Integra anticipates spending less this year on capital expenditures ($104.7 million in 2012 budgeted gross capex) than in 2011 ($136.7 million). The company said capex last year "included significant investment in new capabilities and additional network capacity." The company said around $75 million in capex will be invested to support growth.

Founded in 1996, Portland, Ore.-based Integra has invested more than $2 billion in its network and provides communications, cloud solutions and networking to businesses in 35 metropolitan markets in the western United States.

The company said in the investor presentation that it now has a more attractive customer mix thanks to increased investments in the enterprise space.

Integra’s fiber network is directly connected to more than 1,800 buildings, including 1,438 commercial buildings; the company said delivering service "on-net" reduces its reliance on incumbent carriers like AT&T and Verizon, increases its margin and reduces churn or the number of customers who leave in favor of another provider.

For the nine months ending Sept. 30, 2011, Integra posted a net loss of $72.2 million on revenues of $452.8 million. Those results compare to a loss of $101.2 million on revenues of $464.2 million during the same period in 2010.

Integra lists net debt of $714 million but it appears the company has bought itself time to refinance or otherwise meet its obligations because its term loan ($243.8 million) and notes ($475 million) don’t mature until 2015 and 2016, respectively.


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