By By Tim Cottrell
Trinsic Communications, Inc (formerly known as Z-Tel) has had a big week.
The company, which has its customer service department here in Atmore, released their earnings for fiscal year 2004, appointed two new members to their board of directors, and received a cash settlement in a legal dispute.
The company's earnings were $251.5 million, down from $289.1 million the previous year.
Trey Davis, chief executive officer (CEO) of Trinsic, released a statement about the earnings numbers.
"I first need to thank the Trinsic employees who worked so diligently during the past several months," Davis said. "The fourth quarter of 2004 was very challenging for Trinsic, but we substantially accomplished most of our goals. We are very pleased that the company returned to an EBITDA positive position during the fourth quarter.
"In addition to operating improvements, we completed an exchanged offer for 100% of our preferred stock during the fourth quarter, thus simplifying our balance sheet. We also executed a commercial services agreement with Qwest which will allow Trinsic to continue to provide our traditional circuit-switched telephone services in the Qwest territories.
"Despite immense challenges in the communications industry, we are confident that the steps that management has taken, and continues to take, will best position Trinsic to meet those challenges and improve shareholder value," Davis concluded.
The same press release named the appointments of Roy Neel and Raymond L. Golden to Trinsic's board of directors.
In another prepared statement Davis spoke about the new directors at Trinsic.
"Mr. Neel and Mr. Golden are welcome additions to our board. We look forward to their contributions," said Davis.
Neel is an Adjunct Professor of Political Science at Vanderbilt University. He is chairman of the Jackson Group, a Washington-based consulting firm specializing in public policy and politics; and a director of Blue State Digital, a leading national online communications firm. From 1994-2001 he served as President and CEO of the U.S. Telecom Association, a trade group representing the regional Bell companies. He has also served as a director of Amtrak.
Neel was director of Vice President Al Gore's presidential transition planning in 2000 He was also manager of Gore's post-election challenge in Florida.
Neel had been a key figure in Gore's congressional and Vice-Presidential committees.
Golden spent his entire 38-year career in investment banking. In 1989, he became a partner of Wolfensohn &Company. From 1962-87, he was employed by Salomon Brothers and during his tenure served in a number of executive capacities. During President Ford's administration, Golden was appointed chairman of the Federal Energy Administration's Finance Advisory Committee.
Golden has done extensive public speaking to a large number of professional groups and testified on a wide range of financial issues to governmental agencies. He currently serves as chairman of the investment committee of the Jewish Federation of Palm Beach and vice-chair of the National Wildlife Endowment Fund. Mr. Golden and his wife, Linda, reside in Florida. They have three children and six grandchildren.
Mike Morgan, Vice-President of Corporate Development for Trinsic, was thrilled to see new blood in the organization.
"We've been looking (for new directors) for some time," Morgan said. "We went through a lot of management changes in August of last year. Greg Smith, our founder and CEO, stepped down. So we've been in the market for new directors for a while. One of our biggest investors, Larry Tucker, who runs Brown Brothers Harriman, our largest shareholder, recommended them."
Morgan felt the two were more than qualified for the positions.
"You certainly need independent directors," Morgan said. "And these two are definitely independent. They seem to be enormously qualified to be on board."
In other news, Trinsic's ongoing battle with SBC Communications came to an end this week when the two groups settled for a reported $14 million. Trinsic employees were forbidden to comment on the situation.