Acceris Communications Inc. Reports First Quarter Results.PITTSBURGH -- Acceris Communications Inc. (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :ACRS ACRS See: Accelerated cost recovery system ACRS See Accelerated Cost Recovery System (ACRS). ) today reported its financial results for the first quarter ended March 31, 2005. The Company's total operating revenue operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the quarter ended March 31, 2005 was $22.3 million, which is a decrease of 37 percent from $35.2 million in the first quarter of 2004. Revenue in the first quarter of 2004 included recognition of approximately $6.4 million in non-recurring revenue from a discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: network service offering. For the three months ended March 31, 2005, the Company's operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. was $5.0 million compared to operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $0.8 million for the in the first quarter of 2004. The Company's net loss was $8.1 million in the first quarter of 2005 compared to a net loss of $1.2 million in the first quarter of 2004. The net loss per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. common share was $0.42 in the first quarter of 2005 versus a net loss per diluted common share of $0.06 in the first quarter of 2004. Highlights of the first quarter: - In March, the Company suspended accepting new local UNE-P UNE-P Unbundled Network Element - Platform customers, as a result of the FCC's revision of its wholesale rules on March 11, 2005. - In March, the Company entered into negotiations to sell its wholly-owned Telecommunications service In telecommunication, the term telecommunications service has the following meanings: 1. Any service provided by a telecommunication provider. 2. subsidiary. - In March, the Company reconfigured its Board of Directors in anticipation of the sale of its Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. business. The changes reduced the current Board size to four members. "We are working hard to maximize value for shareholders through the planned disposition of our Telecommunications business. Once completed, we will focus our efforts on gaining market recognition for our technology assets, which include seminal seminal /sem·i·nal/ (sem´i-n'l) pertaining to semen or to a seed. sem·i·nal adj. Of, relating to, containing, or conveying semen or seed. patents in Voice over Internet Protocol See Internet and TCP/IP. (networking) Internet Protocol - (IP) The network layer for the TCP/IP protocol suite widely used on Ethernet networks, defined in STD 5, RFC 791. IP is a connectionless, best-effort packet switching protocol. ," said Allan Silber, Chairman and Chief Executive Officer of Acceris Communications Inc. Please see the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2004 filed with the SEC on March 28, 2005 and the Company's Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the three months ended March 31, 2005 filed with the SEC on May 05, 2005 for further information. About Acceris Acceris is a broad based communications company Communications Company is a communications unit of the United States Marine Corps. They are part of Combat Logistics Regiment 37 , 3rd Marine Logistics Group (3MLG) and III Marine Expeditionary Force (III MEF). The unit is based out of the Marine Corps Base Camp Smedley D. serving residential, small- and medium-sized business and large enterprise customers in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . A facilities-based carrier, it provides a range of products including local dial tone and 1+ domestic and international long distance voice services, as well as fully managed and fully integrated data and enhanced services Enhanced service is service offered over commercial carrier transmission facilities used in interstate communications, that employs computer processing applications that act on the format, content, code, protocol, or similar aspects of the subscriber's transmitted information; . Acceris offers its communications products and services both directly and through a network of independent agents, primarily via multi-level marketing Multi-level marketing (MLM, now sometimes called network marketing) is a business model that combines direct marketing with franchising. Multi-level marketing businesses function by recruiting salespeople (also called Distributors, Independent Business and commercial agent programs. Acceris also offers a proven network convergence solution for voice and data in Voice over Internet Protocol ("VoIP") communications technology Noun 1. communications technology - the activity of designing and constructing and maintaining communication systems engineering, technology - the practical application of science to commerce or industry and holds two foundational patents in the VoIP space. For further information, visit Acceris' website at www.acceris.com. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, as amended that are based on management's exercise of business judgment as well as assumptions made by and information currently available to management. When used in this document, the words "may," "will," "anticipate," "believe," "estimate," "expect," "intend" and words of similar import, are intended to identify any forward-looking statements. You should not place undue reliance on these forward-looking statements. These statements reflect our current view of future events and are subject to certain risks and uncertainties as noted in our securities and other regulatory filings. Should one or more of these risks or uncertainties materialize ma·te·ri·al·ize v. ma·te·ri·al·ized, ma·te·ri·al·iz·ing, ma·te·ri·al·iz·es v.tr. 1. To cause to become real or actual: By building the house, we materialized a dream. , or should underlying assumptions prove incorrect, our actual results could differ materially from those anticipated in these forward-looking statements. We undertake no obligation and do not intend to update, revise or otherwise publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" or to reflect the occurrence of any unanticipated events. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize. Many factors could cause actual results to differ materially from our forward-looking statements.
ACCERIS COMMUNICATIONS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands of dollars, March 31, December 31,
except share and per share amounts) 2005 2004
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ASSETS
Current assets:
Cash and cash equivalents $ 491 $ 458
Accounts receivable, less allowance for
doubtful accounts of $2,903 and $2,163 at
March 31, 2005 and December 31, 2004,
respectively 11,725 13,079
Other current assets 1,503 1,473
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Total current assets 13,719 15,010
Furniture, fixtures, equipment and software,
net 3,120 4,152
Other assets:
Intangible assets, net 1,228 1,404
Goodwill 1,120 1,120
Investment 1,100 1,100
Other assets 1,076 1,223
---------- ---------
Total assets $ 21,363 $ 24,009
---------- ---------
---------- ---------
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Revolving credit facility $ 3,422 $ 4,725
Accounts payable and accrued liabilities 25,181 27,309
Unearned revenue 959 959
Current portion of notes payable 1,944 1,928
Current portion of obligations under capital
leases 968 1,441
---------- ---------
Total current liabilities 32,474 36,362
Notes payable, less current portion 3,119 3,597
Notes payable to a related party 55,477 46,015
---------- ---------
Total liabilities 91,070 85,974
---------- ---------
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $10.00 par value, authorized
10,000,000 shares, issued and outstanding 618
at March 31, 2005 and December 31, 2004,
liquidation preference of $618 at March 31,
2005 and December 31, 2004 6 6
Common stock, $0.01 par value, authorized
300,000,000 shares, issued and outstanding
19,237,135 at March 31, 2005 and December 31,
2004 192 192
Additional paid-in capital 187,016 186,650
Accumulated deficit (256,921) (248,813)
---------- ---------
Total stockholders' deficit (69,707) (61,965)
---------- ---------
Total liabilities and stockholders'
deficit $ 21,363 $ 24,009
---------- ---------
---------- ---------
The notes contained in our Quarterly Report on Form 10-Q are an
integral part of these condensed consolidated financial statements
ACCERIS COMMUNICATIONS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
for the Three Months Ended March 31, 2005 and 2004
(unaudited)
Three Months Ended
March 31,
------------------
(In thousands, except per share amounts) 2005 2004
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Revenues:
Telecommunications services $ 22,253 $ 34,723
Technology licensing and development - 450
--------- ---------
Total revenues 22,253 35,173
--------- ---------
Operating costs and expenses:
Telecommunications network expense (exclusive of
depreciation and amortization shown below) 13,730 16,635
Selling, general and administrative 11,128 14,763
Provision for doubtful accounts 1,055 1,227
Depreciation and amortization 1,308 1,704
--------- ---------
Total operating costs and expenses 27,221 34,329
--------- ---------
Operating income (loss) (4,968) 844
--------- ---------
Other income (expense):
Interest expense - related party (2,487) (2,803)
Interest expense - third party (680) (730)
Other income 27 1,377
--------- ---------
Total other income (expense) (3,140) (2,156)
--------- ---------
Loss from continuing operations (8,108) (1,312)
Gain from discontinued operations (net of $0 tax) - 104
--------- ---------
Net loss $ (8,108) $ (1,208)
--------- ---------
--------- ---------
Basis and diluted weighted average shares
outstanding: 19,237 19,262
Net loss per common share - basic and diluted:
Loss from continuing operations $ (0.42) $ (0.07)
Gain from discontinued operations 0.00 0.01
--------- ---------
Net loss per common share $ (0.42) $ (0.06)
--------- ---------
--------- ---------
The notes contained in our Quarterly Report on Form 10-Q are an
integral part of these condensed consolidated financial statements
Acceris Communications Inc. (OTC Bulletin Board OTC Bulletin Board An electronic quotation listing of the bid and asked prices of OTC stocks that do not meet the requirements to be listed on the NASDAQ stock-listing system. :ACRS) (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :CXS CXS Coherent X-Ray Scattering ) |
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