<PAGE>
EXHIBIT 99.2
NorthPoint Reports Second-Quarter Results
Groundbreaking Deal with Verizon Establishes NorthPoint as
New National DSL Leader
San Francisco, August 8, 2000 - NorthPoint Communications [Nasdaq: NPNT] today
reported results for the quarter ended June 30, 2000, highlighted by continued
strong revenue and digital subscriber line (DSL) subscriber growth. The company
also announced today an unprecedented agreement with Verizon Communications
[NYSE: VZ]. The agreement combines Verizon's and NorthPoint's DSL wholesale
businesses to create a new national DSL leader capable of delivering increased
broadband services choice and innovation to American consumers and businesses.
"Our deal with Verizon creates a new NorthPoint and a new national DSL leader
combining the hard-charging spirit of a DSL pioneer with a new depth of
resources enabling us to scale faster for the ever-growing broadband
opportunity," said Liz Fetter, NorthPoint's president and CEO. "The fundamentals
of the DSL business are only improving, and NorthPoint has significantly
strengthened its position as a long-term competitor and innovator in this
market."
Financial Results
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On June 20, 2000, NorthPoint pre-reported a range of expectations for second-
quarter revenue growth, subscriber growth and earnings before net interest,
taxes, depreciation, and amortization (EBITDA). The actual figures reported for
the second quarter are in line with these expectations.
NorthPoint reported revenue of $24.4 million for the quarter ended June 30,
2000, a 22 percent sequential increase over revenue of $20.0 million for the
quarter ended March 31, 2000. NorthPoint's revenue for the quarter ended June
30, 2000 increased nearly tenfold from second quarter 1999 revenue of $2.5
million.
Reflecting the company's accelerated network expansion and the implementation of
its new service delivery and support platform, net loss for the second quarter
of 2000 was $112.1 million versus a net loss of $79.9 million for the quarter
ended March 31, 2000. NorthPoint recorded a net loss of $37.9 million for the
quarter ended June 30, 1999. EBITDA for the quarter ended June 30, 2000 was
negative $78.8 million versus negative $61.7 million for the quarter ended March
31, 2000 and negative $29.2 million for the year-ago quarter.
During the second quarter, NorthPoint reached a major milestone by achieving
EBITDA-positive performance in four of its earliest launched markets: San
Francisco, Los Angeles, Chicago and San Diego demonstrating an accelerated pace
toward profitability. Each of these markets turned EBITDA-positive well before
the expected 24-month timeframe.
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Second-Quarter Operational Results
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The number of NorthPoint DSL subscribers grew 50 percent in the second quarter
of 2000 to 62,000 subscribers from 41,300 subscribers as of March 31, 2000.
Fully operational central offices increased during the second quarter to 1,505
from 1,260 as of March 31, 2000, and built or operational central offices
increased to 1,620 during the same period. The number of homes and businesses
passed increased during the quarter to approximately 41 million from 36 million
at March 31, 2000.
NorthPoint launched a number of strategic initiatives during the second quarter.
Among these initiatives:
. Network Expansion - NorthPoint expanded its network to 14 new markets and is
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now operational in 99 metropolitan statistical areas.
. Line Sharing - NorthPoint secured line-sharing agreements with all major
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ILECs, a development that will dramatically reduce NorthPoint's costs for
shared loops from costs for today's stand-alone loops.
. International - VersaPoint, NorthPoint's European venture, launched service
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in the Netherlands in June. Through its NorthPoint Canada venture, NorthPoint
recently introduced service in Toronto.
. New Products - Leveraging its new national backbone and the intelligence
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built into its local broadband networks, NorthPoint launched "Regional
Connect," a new service enabling its ISP partners to interconnect in one
NorthPoint market and serve customers in other regions covered by its network
footprint.
. Senior Management Appointments - NorthPoint further strengthened its senior
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management team with the appointments of Michael Glinsky and Shellye
Archambeau to the positions of chief financial officer and chief marketing
officer, respectively. Glinsky formerly served as executive vice president
and CFO at U S West. Archambeau, recently named to Internet World's list of
top "click & mortar" executives, most recently served as president of
Blockbuster Entertainment's e-commerce division.
In April, NorthPoint implemented its new service delivery and support platform,
OSS2000, designed to be one of the most advanced and automated in the industry
and expected to drive continued improvements in the company's ability to scale.
The system is providing increased capacity, however one necessary software
modification has been temporarily delayed and, as a result, management believes
that cumulative line installations at the end of the third and fourth quarters
may fall 10 to 15 percent below current estimates and that EBITDA losses may
increase by $10-$15 million. Management expects continued strong revenues for
the year within the current range of analyst expectations.
The combination of NorthPoint's entrepreneurial management and experience with
the resources and capabilities of Verizon will create a national broadband
leader with significantly enhanced scale and long-term growth opportunities.
NorthPoint anticipates that the combined businesses will have more than 600,000
lines on a pro forma basis as of the end of the year.
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NorthPoint and Verizon Create New DSL Wholesale Leader
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NorthPoint and Verizon separately announced today the merger of their respective
digital subscriber line (DSL) businesses creating one of the world's best
positioned broadband services companies with significantly improved access to
capital. As part of the agreement, Verizon will contribute its DSL assets and
$800 million in cash to the new NorthPoint. Verizon will distribute $350
million of this cash to existing NorthPoint shareholders. On a per share basis,
this pay out is estimated to be $2.50 per share. Verizon will also invest $450
million to fund the "new" NorthPoint's business plan. As a result of its
investment of cash and other assets, Verizon will receive a 55 percent ownership
in NorthPoint. NorthPoint will continue to report financial results and trade
as a separately listed public company. Its financial results will also be
consolidated into Verizon's financial results.
The merger combines the DSL networks, product suites, strategic partnerships,
customers and personnel of NorthPoint and Verizon to create the preeminent
broadband leader dedicated to accelerating broadband service innovation and
choice nationwide. The combined operations of NorthPoint and Verizon expect to
begin the year 2001 with the following growth metrics:
December 31, 2000
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End-of-Year Subscribers 600,000+
Unique Operational Central Offices 3,000+
Homes & Business Passed 63 million
MSAs Served 163
NorthPoint's merger with Verizon requires approval from the Federal
Communications Commission, Department of Justice, various state commissions and
NorthPoint shareholders. The companies expect to complete the merger in the
fist half of 2001.
About NorthPoint
NorthPoint Communications Group, Inc., one of the fastest-growing DSL services
providers in the U.S., is building a global network designed to deliver
affordable, dedicated high-speed Internet access, streaming content and other
value-added services to consumers and businesses around the world. The company
currently operates DSL-based local networks in 99 U.S. metropolitan statistical
areas (MSAs). NorthPoint is also expanding its services around the globe
through strategic partnerships with Versatel in Europe and Call-Net in Canada.
On August 8, 2000, NorthPoint announced an agreement with Verizon to combine
their industry-leading DSL businesses. The agreement strengthens NorthPoint's
ability to quickly scale to meet the fast-growing demand for broadband services
and to deliver innovative new services and greater choice to American consumers
and businesses. The combined operations of NorthPoint and Verizon are expected
to serve more than 600,000 DSL subscribers and will pass approximately 63
million potential subscribers in 163 MSAs by the end of 2000. For additional
information, visit www.northpoint.net.
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# # #
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Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995: The statements contained in this release which are not historical facts
may be deemed to contain forward-looking statements. Such statements are
indicated by words or phrases such as "anticipate," "estimate," "projects,"
"believes," "intends," "expects" and similar words and phrases. Actual results
may differ materially from those expressed or implied in any forward-looking
statement as a result of certain risks and uncertainties. Some of these risks
and uncertainties include, without limitation: NorthPoint's dependence on
strategic third parties to market and resell its services, intense competition
for NorthPoint's service offerings, dependence on growth in demand for DSL-based
services, ability to raise additional capital, the inability to obtain, or meet
conditions imposed for, governmental approvals for the proposed merger with
Verizon Communications' DSL business, the failure of NorthPoint's stockholders
to approve the merger, costs related to the merger, the risk that NorthPoint's
and Verizon's DSL businesses will not be integrated successfully, the failure of
NorthPoint to realize anticipated benefits of the merger and other economic,
business, competitive and/or regulatory risks and uncertainties detailed in the
company's Securities and Exchange Commission filings. Prospective investors are
cautioned not to place undue reliance on such forward-looking statements. The
Company disclaims any obligation to update any of the forward-looking statements
contained herein to reflect future events or developments.
NorthPoint Communications Group, Inc. and Bell Atlantic Corporation (d/b/a
Verizon Communications) will file a joint proxy statement/prospectus and other
documents regarding the proposed business combination transaction referenced in
the foregoing information with the Securities and Exchange Commission. Investors
and security holders are urged to read the proxy statement/prospectus, when it
becomes available, because it will contain important information. A definitive
joint proxy statement/prospectus will be sent to stockholders of NorthPoint
Communications Group, Inc. seeking their approval of the proposed transaction.
Investors and security holders may obtain a free copy of the definitive joint
proxy statement/prospectus (when it is available) and other documents filed by
NorthPoint Communications Group, Inc. and Bell Atlantic Corporation (d/b/a
Verizon Communications) with the Commission at the Commission's web site at
www.sec.gov. The definitive joint proxy statement/prospectus and these other
documents may also be obtained for free by NorthPoint stockholders by directing
a request to: NorthPoint Communications Group, Inc., 303 Second Street, South
Tower, San Francisco, CA 94107, Attn: Investor Relations, (415) 403-4003,
email: [email protected].
<PAGE>
NorthPoint Communications Group, Inc.
consolidated Statements of Operations
(Unaudited)
(Amouts in thousnads, except share and per share data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
------------------- ----------------
June 30, 2000 June 30, 1999 June 30, 2000 June 30, 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues $ 24,403 $ 2,504 $ 44,374 $ 3,787
Operating Expenses:
Network expenses 40,894 7,801 74,432 11,733
Selling, marketing, general and
administrative expenses 62,301 23,910 110,473 38,240
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EBITDA (1) (78,792) (29,207) (140,531) (46,186)
Amortization of deferred stock compensation 1,252 1,215 2,462 2,807
Depreciation and amortization 17,959 2,813 28,702 4,200
------------- ------------- ------------- -------------
Loss from operations (98,003) (33,235) (171,695) (53,193)
Interest income 4,810 3,026 9,848 3,264
Interest expense (16,602) (7,689) (27,612) (11,271)
Equity in net income (loss) of affiliated companies (2,030) 0 (2,030) 0
Taxes (235) (4) (510) (54)
------------- ------------- ------------- -------------
Net loss $ (112,060) $ (37,902) $ (191,999) $ (61,254)
============= ============= ============= =============
Basic and diluted net loss
per common share $ (0.85) $ (0.44) $ (1.47) $ (1.10)
============= ============= ============= =============
Weighted average shares used in
computing net loss per share 132,098,858 86,113,944 130,554,664 55,680,075
Other data:
Selected Balance Sheet Data: June 30, 2000 June 30, 1999
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Cash, cash equivalents and short-term investments $ 217,062 $ 402,752
Net property and equipment 397,313 89,788
Total assets 734,693 503,106
Current liabilities 113,814 20,808
Long-term obligations 494,820 57,290
Stockholders' equity 126,059 425,008
</TABLE>
(1) EBITDA is defined as net income (loss) before net interest, taxes,
depreciation, amortization (including amortization of deferred stock
compensation), and equity in net income (loss) of affiliated companies.
