MINET officials predict 7.4 percent raise in revenue

CFO says market share not there to pay $25 million debt, operating expenses, capital improvements



MONMOUTH/INDEPENDENCE — Revenue for Monmouth Independence Networks (MINET) is expected to increase in 2015-16, but by about 7.4 percent, less than the 24 percent expected increase from last year.

The total annual revenue is expected to be $4.886 million, compared to $4.548 projected in 2014-15.

Chief Financial Officer Mark Thoenes said MINET’s income from operations is expected to be $999,926 in 2014-15, 25 percent less than the $1.345 million the company made in 2013-14.

The decrease is mostly because of unexpected, one-time expenses, Thoenes said, including storm damage that was not covered by insurance in December and large increases in fees from cable providers for content.

For 2015-16, Thoenes said MINET projects making about $1.2 million in net ordinary income, a 20 percent increase over last year.

MINET’s total expected net income is 43 percent of what it needs to be able to fully fund its $25 million debt, operating expenses and capital expenses, said Thoenes.

“The company is able to pay its operating costs, but it’s insufficient to pay debt,” he said.

After it pays its operating costs and capital expenses, MINET will be able to pay $956,446 of its $2.046 million debt payments for 2015-16, leaving $1.090 million for the cities to cover.

MINET Manager Don Patten told the budget committee that one of the reasons for the 7.4 percent total expected revenue was that the market was not in MINET’s coverage area to expand.

Last year’s budget forecast was filled with too much optimism and not enough understanding of what the market really is, Thoenes said.

After further analysis and efforts to gain customers, it was found that those people were using competitors or had no interest in the services MINET could provide — some did not own computers.

“This marketplace you have out there is more highly penetrated, and it’s not as large as you think,” Thoenes said.

To increase revenue, MINET will need to look for other ways to bring in money, such as leasing excess capacity to other businesses, in addition to increasing data customers, Patten said.

In leasing MINET’s capacity, it would allow a private carrier to use MINET’s infrastructure.

Up Next

• The MINET budget committee met Tuesday after press time. The MINET Board of Directors meets at 7:30 a.m. Thursday.

• In the next fiscal year, MINET hopes to address a number of issues in the data provider portion of the business, including updating documentation; updating and patching servers, nearly all of which are out of date and have never been updated; updating antiquated monitoring systems; identifying unidentified systems that are running in the data center; and completely redesigning of core ISP services, bringing servers up to date with the most applicable platforms.

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