After its first year of operation, Lafayette Utilities System Director Terry Huval says LUS' fiber-to-the-premise telecommunications business is above its break-even target and ahead of its projected schedule. After its first year of operation, Lafayette Utilities System Director Terry Huval says LUS' fiber-to-the-premise telecommunications business is above its break-even target and ahead of its projected schedule. "We are still building out the system and will be complete around July, 2010 (about 9 months earlier than we initially expected)," LUS Director Terry Huval writes in an e-mail. "Early in the planning of the project in 2004, we estimated that our breakeven for the project would be about 23 percent. In the areas where we have done the most of our limited marketing, we are already well-above that target. We are opening up new areas for service every week, so naturally those early take rate level are lower in those areas. But, we are pleased with the response we are getting. All indications are that we will easily meet all our financial obligations moving forward." He adds that the business has also exceeded its projection of customers who buy all three services - phone, TV and Internet. LUS Fiber first began serving customers in February of last year. The business' first major debt service payments come due in 2011.
According to its three most recently completed monthly financial reports, for October, November and December 2009, the LUS Fiber business' revenues exceeded its monthly operating expenses in two of those months (October and November). For October, monthly revenues totaled $1,644,492.88 while operating expenses totaled $874,991.57. In December, total revenue was down due to a dip in wholesale receipts. Huval says this fluctuation reflects some of the cyclical revenue collecting and accounting inherent in the wholesale business.
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