SAN JOSE, Calif., August 1, 2000 (PRIMEZONE) -- On Command Corporation (Nasdaq:ONCO) announced today that 2000 second quarter revenues climbed to a record $65.8 million, a 5.1 percent increase over the $62.6 million reported in the second quarter of 1999. Second quarter earnings before interest, taxes, depreciation, amortization, and stock based compensation (EBITDA) totaled $18.8 million, compared to $18.3 million recorded in the corresponding 1999 period.
The record revenue was primarily attributable to new hotel installations, continued conversions of hotels served by SpectraVision systems to superior performing On Command Systems, and higher net revenues per equipped room (RER). RER per month totaled $21.84 in Q2 2000 compared to $21.04 in the second quarter of 1999, a 3.8 percent improvement. The Q2 2000 RER increases even more significantly - to $23.35 when SpectraVision rooms, which are being converted over time, are excluded.
The improvement in revenue per room was primarily due to reduced movie denial rates as well as significant increases in Internet and game revenues driven by OCX(r) installations, On Command's fully interactive, integrated entertainment and Internet delivery system. Improvement in net loss was due to the increase in EBITDA as well as a significant reduction in depreciation primarily due to the expiration of depreciation on the acquired SpectraVision assets. Depreciation decreased from 37.6 percent of revenue in Q2 1999 to 32.6 percent in Q2 2000.
On June 30, 2000, On Command Corporation's installed room base was approximately 969,000 rooms, as compared to approximately 942,000 at the end of the second quarter of 1999. In the second quarter of 2000, On Command installed its on-demand system in approximately 27,700 rooms, of which 13,500 were new hotel installations, 5,500 were conversions of SpectraVision properties, and 8,700 were conversions of OCV systems to the advanced OCX(r) system, the Company's interactive multimedia platform. At June 30, 2000, rooms installed with the OCX platform totaled approximately 83,000, an increase of 23,000 rooms from March 31, 2000. Of these 83,000 rooms, 69,000 rooms were active with Internet. In addition the Company's @Hotel(tm) PC product has been installed in approximately 6,000 rooms, bringing the total Internet installations to over 75,000.
"We remain on schedule with the deployment of OCX," said Jerome H. Kern, Chairman and CEO of On Command. "Our goal of 150,000 OCX installations by year end is well within our reach, and our immediate focus is expansion of our platform technologically, as well as aggressive development of a creative and broad array of programming for hotel guests."
On July 18, 2000, the Company closed on a $350 million refinancing of its unsecured revolving credit facility on very favorable terms in today's credit environment. "The significance of this financing cannot be overemphasized," stated Paul Milley, Senior Vice President and CFO. "This facility provides sufficient funding for us to complete the re-equipping of our hotel base with the OCX platform as well as facilitating continued room growth domestically and internationally. At the same time, the Company's leverage continues to be very conservative, with a leverage ratio of 2.7."
On Command Corporation (www.oncommand.com) is the leading provider of in-room interactive entertainment, Internet services, business information and guest services for the lodging industry and its guests. The company is based in San Jose, California with offices across the United States and around the world. On Command Corporation annually serves more than 250 million guests through nearly 1 million rooms in approximately 3,450 hotel properties in over 22 countries. These hotel partners represent over 100 of the most prestigious hotel chains and operators in the lodging industry including Adam's Mark Hotels and Resorts; Bass Hotels & Resorts (InterContinental, Crowne Plaza, and Holiday Inn), Fairmont, Four Seasons, Hilton (Doubletree, Embassy Suites), Hyatt, Loews, Marriott (Courtyard, Renaissance, Fairfield Inn & Residence Inn), Radisson, Ramada, Starwood Hotels & Resorts (Westin, Sheraton, W Hotels, Four Points), and Wyndham Hotels & Resorts. OCX is a registered trademark and @Hotel is a service mark of On Command Corporation.. On Command is listed on the Nasdaq Stock Market under the symbol ONCO and its warrants are traded under the symbols ONCOW and ONCOZ.
Information and statements presented in this press release may contain forward looking disclosures, expressed or implied, that are based on the beliefs of management as well as assumptions made based on information currently available to management. These forward looking statements and information involve risks and uncertainties including, but not limited to, the ability of the Company to raise capital, future demand for the Company's services, general economic conditions, government regulations, competition and customer strategies, capital deployment, the impact of pricing and other risks and uncertainties. Should one or more of these risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this press release as anticipated, believed, estimated or expected. These risks are detailed from time to time in various reports filed by On Command Corporation with the Securities and Exchange Commission, including Forms 10-K (filed for the year-ended December 31, 1999) and Forms 10-Q filed quarterly (and most recently filed for the quarter ended March 31, 2000).