U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 12b-25
COMMISSION FILE NUMBER 0-27580
NOTIFICATION OF LATE FILING
CUSIP NUMBER 054529 20 1
(Check One):
[X] Form 10-K and Form 10-KSB [ ] Form 20-F [ ] Form 11-K [ ] Form 10-Q and
Form 10-QSB [ ] Form N-SAR
For Period Ended: December 31, 1998
[ ] Transition Report on Form 10-K
[ ] Transition Report on Form 20-F
[ ] Transition Report on Form 11-K
[ ] Transition Report on Form 10-Q
[ ] Transition Report on Form N-SAR
For the Transition Period Ended:
Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein.
If the notification relates to a portion of the filing checked above, identify
the Item(s) to which the notification relates: ________________________
Part I--Registrant Information
Full Name of Registrant: AvTel Communications, Inc.
Former Name if Applicable: _______________________
Address of Principal Executive Office (Street and Number):
City, State and Zip Code:
501 Bath Street
Santa Barbara, CA 93101
Part II--Rule 12b-25 (b) and (c)
If the subject report could not be filed without unreasonable effort or expense
and the registrant seeks relief pursuant to Rule 12b-25(b), the following should
be completed.
(Check box if appropriate)
[X] (a) The reasons described in reasonable detail in Part III of this form
could not be eliminated without unreasonable effort or expense;
[X] (b) The subject annual report, semi-annual report, transition report on
Form 10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof will be filed
on or before the fifteenth calendar day following the prescribed due date;
or the subject quarterly report or transition report on Form 10-Q, or
portion thereof will be filed on or before the fifth calendar day following
the prescribed due date; and
[ ] (c) The accountant's statement or other exhibit required by Rule
12b-25(c) has been attached if applicable.
Part III--Narrative
State below in reasonable detail the reasons why Form 10-K and Form 10-KSB,
20-F, 11-K, 10-Q and Form 10-QSB, N-SAR, or the transition report or portion
thereof could not be filed within the prescribed period:
The Registrant's independent auditors have requested additional information
from the Registrant in order to complete the audit of Registrant's financial
statements for the year ending December 31, 1998. In addition, the Registrant's
resources have been employed in a prospective financing transaction.
Because of the time and effort on the part of the Registrant and its
management required (i) in order to collect such information and provide it to
its auditors, and (ii) in connection with the prospective financing, the
Registrant is unable to complete and file its Form 10-K for the year ended
December 31, 1998, by the prescribed due date without unreasonable effort or
expense. The Registrant will file its Form 10-K for such period no later than
April 15, 1999, the fifteenth calendar day following the due date.
Part IV--Other Information
(1) Name and telephone number of person to contact in regard to this
notification:
Anthony E. Papa (805) 884-6300
(Name) (Area Code) (Telephone Number)
(2) Have all other periodic reports required under section 13 or 15(d) of
the Securities Exchange Act of 1934 or section 30 of the Investment Company Act
of 1940 during the preceding 12 months or for such shorter period that the
registrant was required to file such report(s) been filed? If the answer is no,
identify report(s).
[X] Yes [ ] No
(3) Is it anticipated that any significant change in results of operations
from the corresponding period for the last fiscal year will be reflected by the
earnings statements to be included in the subject report or portion thereof?
[X] Yes [ ] No
If so: attach an explanation of the anticipated change, both narratively
and quantitatively, and, if appropriate, state the reasons why a reasonable
estimate of the results cannot be made.
For the year ended December 31, 1998, AvTel recorded revenues of $44.0
million and a net loss of $7.1 million or $0.74 per share on 9.6 million basic
and diluted shares. The Company reported revenues of $51.4 million and a net
loss of $10.2 million with a per share loss of $1.23 on approximately 8.3
million basic and diluted shares for the year ended December 31, 1997.
The decline in gross revenues for the year ended December 31, 1998 over the
year ended December 31, 1997 is primarily attributable to the anticipated
reduction in less profitable residential long distance revenue in the Company's
wholly-owned subsidiary Matrix Telecom, Inc. The existing base of residential
long distance telephone services continued to churn down through the fourth
quarter. Pricing re-rates, customer churn and minimal retention activity of
older lower margin telemarketing and casual calling customers lead to a
reduction in long distance revenue which was partially offset by other growing
businesses such as data connectivity and Internet sales and by the addition of
approximately $1.0 million of revenue from the acquisition of Remote Lojix/PCSI,
Inc. in November 1998.
Gross margins declined to 27.6% in 1998 compared to 29.5% in 1997 due to
the continuing price pressure the industry is facing with increased competition.
Additionally 1997 included a $9.1 million acquisition write off related to
the Matrix Telecom acquisition, which did not reoccur in 1998.
AvTel Communications, Inc.
(Name of Registrant as specified in charter)
Has caused this notification to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: March 30, 1999
By /s/ ANTHONY E. PAPA
Anthony E. Papa
Chief Executive Officer
ATTENTION
Intentional misstatements or omissions of fact constitute Federal Criminal
Violations (See 18 U.S.C. 1001).
