Airgate PCS, Inc. Announces First Quarter Fiscal 2002 Results.Business Editors ATLANTA--(BUSINESS WIRE)--Jan. 29, 2001 AirGate PCS (1) (Personal Communications Services) Refers to wireless services that emerged after the U.S. government auctioned commercial licenses in 1994 and 1995. This radio spectrum in the 1. , Inc., (Nasdaq/NM: PCSA PCSA Primary Care Service Area PCSA Personal Computing Systems Architecture PCSA Power Crane and Shovel Association PCSA Peel Committee on Sexual Assault (Canada) PCSA Presbyterian Church of Southern Africa ), a Sprint PCS Network Partner, today announced financial and operating results for the first fiscal quarter ended December December: see month. 31, 2001. As previously announced, AirGate completed its merger with iPCS, Inc., another Sprint PCS Network Partner, on November November: see month. 30, 2001. The Company reported the following consolidated operating results, reflecting AirGate PCS stand-alone (jargon) stand-alone - Capable of operating without other programs, libraries, computers, hardware, networks, etc. Exactly what is absent is presumed to be obvious from context. "We only run Windows on stand-alone PCs because it's too dangerous to run it on networked ones." for three months and iPCS stand-alone for one month. Net revenues were $81.7 million for the first quarter of fiscal 2002, compared with $23.0 million for the prior year period. The net loss was ($29.6) million, or ($1.68) per share, for the three months ended December 31, 2001, compared with a net loss of ($33.9) million, or ($2.64) per share, for the prior year period. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become loss (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
Additional financial and operating highlights for AirGate PCS on a consolidated basis (AirGate PCS stand-alone for three months and iPCS stand-alone for one month) and on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis (combined three months each of AirGate PCS and iPCS) for the first quarter of fiscal 2002 include the following:
Pro Forma
Consolidated Combined
--------------- ---------------
Net subscriber additions
("net additions") 69,215 87,258
------------------------------- --------------- ---------------
Average revenue per user
("ARPU") $60 $59
------------------------------- --------------- ---------------
EBITDA loss, excluding
non-cash stock option
compensation expense ($20.7) million ($41.7) million
------------------------------- --------------- ---------------
EBITDA loss, excluding
merger related expenses
and non-cash stock option
compensation expense ($20.0) million ($26.6) million
------------------------------- --------------- ---------------
Churn, net of 30 day returns 3.0% 3.0%
------------------------------- --------------- ---------------
Roaming revenue $21.3 million $30.6 million
------------------------------- --------------- ---------------
Roaming expense $17.1 million $23.5 million
------------------------------- --------------- ---------------
Capital expenditures $23.7 million $46.2 million
------------------------------- --------------- ---------------
"In this difficult economic environment, we are encouraged by our continued solid operating results for the quarter and the further expansion of our subscriber base," commented Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs M. Dougherty Dougherty may refer to:
The Company also indicated that, based on current market conditions, current and anticipated product offerings and credit policies, current and historical sales patterns, and budgeted expenditures, it is providing guidance for the second fiscal quarter ending March 31, 2002, as follows: -- Net additions are expected to be 38,000 to 45,000. -- ARPU is expected to be $59 to $61. -- Roaming revenue is forecasted to be $20 million to $22 million. Conversely, roaming expense is expected to be $16 million to $18 million. -- EBITDA losses, excluding merger related expenses and non-cash stock option compensation expense, are expected to be $8 million to $10 million. -- Capital expenditures for the remaining nine months of the fiscal year will be approximately $75 million to $80 million, of which $40 million to $45 million will be incurred in the second fiscal quarter. AirGate PCS will hold a conference call to discuss this press release tomorrow, January January: see month. 30, 2002 at 10:00 a.m. ET. A live broadcast of the conference call will be available online at www.airgatepcsa.com or www.companyboardroom.com. To listen to the live call, please go to the web site at least fifteen minutes early to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. , and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call through the close of business on March 29, 2002. About AirGate PCS AirGate PCS, Inc. and its subsidiaries are the Sprint PCS Network Partners with the exclusive right to sell Sprint PCS products and services in territories within seven states located in the southeastern and mid-western 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. . The territories include over 14.6 million residents in key markets such as Grand Rapids, Michigan “Grand Rapids” redirects here. For other uses, see Grand Rapids (disambiguation). Grand Rapids is a city in the U.S. state of Michigan. As of the 2000 census, the city population was 197,800. ; Charleston Charleston, cities, United States Charleston. 1 City (1990 pop. 20,398), seat of Coles co., E Ill.; inc. 1835. Charleston is an industrial, rail, and trade center located in an agricultural area; shoes are also made. Eastern Illinois Univ. , Columbia Columbia, cities, United States Columbia (kəlŭm`bēə). 1 City (1990 pop. 75,883), Howard co., central Md., between Washington, D.C., and Baltimore. , and Greenville-Spartanburg, South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. ; Augusta Augusta, city, Italy Augusta (oug  `stä), city (1991 pop. 34,189), E Sicily, Italy, on an island (formerly a peninsula) in the Ionian Sea, connected by bridge with the Sicilian and
Savannah, Georgia Savannah is a city located in (and the county seat of) Chatham County, Georgia (USA). The city's population was 128,500 in 2005, according to the most recent U.S. Census estimate. Savannah was the first colonial and state capital of Georgia. ; Champaign-Urbana and Springfield, Illinois Springfield is the capital of the U.S. state of Illinois and the county seat of Sangamon County. As reported in the 2000 U.S. Census, the city was home to 111,454 people. The land on which Springfield is today was first settled in the late 1810s, around the time Illinois became a ; and the
Quad Cities
The Quad Cities are a group of cities which flank the Mississippi River in Iowa and Illinois in the midwestern United States. areas of Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. and Iowa. AirGate PCS is among the largest Sprint PCS Network Partners. As a Sprint PCS Network Partner, AirGate PCS operates its own local PCS network to exclusively provide 100% digital, 100% PCS products and services under the Sprint name in its territories. About Sprint Sprint is a global 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 23 million business and residential customers in more than 70 countries. With more than 80,000 employees worldwide and $23 billion in annual revenues, Sprint is widely recognized for developing, engineering and deploying state of the art network technologies, including the United States' first nationwide all-digital, fiber-optic See fiber optics. network. Sprint's award-winning Tier 1 Internet backbone (communications, networking) Internet backbone - High-speed networks that carry Internet traffic. These communications networks are provided by companies such as AT&T, GTE, IBM, MCI, Netcom, Sprint, UUNET and consist of high-speed links in the T1, T3, OC1 and OC3 ranges. is being extended to key global markets to provide customers with a broad portfolio of scalable IP products. Sprint's high-capacity, high-speed network gives customers fast, dependable, non-stop access to the vast majority of the world's Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the content. Sprint also operates the largest 100-percent digital, nationwide PCS wireless network in the United States, already serving the majority of the nation's metropolitan areas including more than 4,000 cities and communities. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995: Certain statements contained in this news release, such as statements concerning AirGate PCS' or the combined company's anticipated performance, plans for growth and anticipated financial results and other factors that could affect future operations or performance, and other non-historical facts, are forward looking statements made pursuant to the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. Since these forward looking statements are based on factors that involve risks and uncertainties, actual results may differ materially from those expressed or implied by such forward looking statements. Such factors include: the ability to successfully integrate the two businesses; the competitiveness and impact of Sprint PCS pricing plans, products and services; customer quality; the ability of Sprint PCS to provide back office, customer care and other services; consumer purchasing patterns; potential fluctuations in quarterly results; an adequate supply of subscriber equipment; risks related to our ability to compete with larger, more established businesses; rapid technological and market change; risks related to future growth and expansion; rates of penetration in the wireless industry; the potential need for additional sources of liquidity; anticipated future losses; the significant level of indebtedness INDEBTEDNESS. The state, of being in debt, without regard to the ability or inability of the party to pay the same. See 1 Story, Eq. 343; 2 Hill. Ab. 421. 2. of each of AirGate and iPCS; adequacy of bad debt and other reserves; the potential to experience a high rate of customer turnover; and the volatility of AirGate PCS' stock price. For a detailed discussion of these and other cautionary statements and factors that could cause actual results to differ from those contained in this news release, please refer to AirGate PCS' and iPCS' filings with the Securities and Exchange Commission ("SEC"), especially in the "investment considerations" section of AirGate PCS' 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 fiscal year ended September 30, 2001, and iPCS' Form 10-K for the year ended December 31, 2000, iPCS Form 10-Q Form 10-Q See 10-Q. for the quarter ended September 30, 2001, and in subsequent filings with SEC. In addition, EBITDA is a financial measure used in the financial community and ARPU (Average Revenue Per User) A calculation often used to determine the overall value of an application. It is also used to rate particular customers, especially in the wireless space, by comparing someone's account to the overall average. and churn churn: see butter. are metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. used in the wireless telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. industry. None of these terms are measures of financial performance under generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting in the United States. See the notes below for a description of these terms. Definitions of Terms Used: ARPU -- Average Revenue Per User: Summarizes the average monthly service revenue per customer, excluding roaming The ability to use a communications device such as a cellphone or PDA and be able to move from one cell or access point to another without losing the connection. revenue. ARPU is computed by dividing service revenue by the average subscribers for the period, net of an adjustment for those customers not reasonably expected to pay. Churn: Churn is the monthly rate of customer turnover expressed as a percentage of the customer base that 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: the service during the month. Churn is computed by dividing the number of customers that discontinued the service during the month by the average subscribers for the period, net of an adjustment for those customers not reasonably expected to pay. Net Additions: Net additions refer to the increase in total subscribers between periods, net of an adjustment for those customers not reasonably expected to pay. Ending Subscribers: Ending subscribers exclude an estimate of new customers added during the first fiscal quarter who are not reasonably expected to pay. iPCS adopted the same accounting policy as of October 1, 2001. Merger Related Expenses: Merger related expenses include amounts paid by iPCS with respect to its acquisition by AirGate, including: investment banking fees, legal fees, accounting fees and severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and change of control amounts due to certain employees pursuant to employment agreements on the date of acquisition.
AirGate PCS, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
(dollars in thousands, except share and per share amounts)
Three Months Ended
December 31,
----------------------------
2001 2000
Revenues: ------------ ------------
Service revenue $ 55,849 $ 13,341
Roaming revenue 21,303 7,388
Equipment revenue 4,545 2,290
------------ ------------
$ 81,697 $ 23,019
Operating expenses:
Cost of service and roaming (57,757) (16,970)
Cost of equipment (9,583) (5,072)
Selling and marketing (29,845) (16,678)
General and administrative (5,200) (4,709)
Non-cash stock compensation (231) (332)
Depreciation (11,266) (6,662)
Amortization of intangible assets (4,539) --
------------ ------------
Total operating expenses (118,421) (50,423)
------------ ------------
Operating loss (36,724) (27,404)
Interest income 99 1,289
Interest expense (10,283) (7,748)
Other expense (95) --
------------ ------------
Loss before income tax benefit (47,003) (33,863)
Income tax benefit 17,359 --
------------ ------------
Net loss $ (29,644) $ (33,863)
============ ============
Basic and diluted net loss per share
of common stock $ (1.68) $ (2.64)
============ ============
Weighted average outstanding common
shares 17,675,349 12,835,296
============ ============
Weighted average potentially dilutive common stock equivalents:
Common stock options 577,680 556,674
Stock purchase warrants 127,196 135,605
------------ ------------
Weighted average outstanding shares
including potentially dilutive
common stock equivalents 18,380,225 13,527,575
============ ============
AirGate PCS, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
(dollars in thousands)
Dec. 31, Sept. 30,
ASSETS 2001 2001
Current assets: ---------- ----------
Cash and cash equivalents $ 25,149 $ 14,290
Accounts receivable, net 39,012 23,798
Receivable from Sprint PCS 14,033 10,200
Inventories 8,651 4,639
Prepaid expenses 6,517 3,428
Direct customer activation costs 5,301 3,693
Other current assets 1,301 1,291
---------- ---------
Total current assets 99,964 61,339
---------- ---------
Property and equipment, net 434,845 209,326
Financing costs 17,019 7,888
Intangible assets, net 486,864 1,889
Goodwill 387,392 --
Other assets 4,516 568
---------- ---------
Total assets $1,430,600 $ 281,010
========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $ 47,266 $ 10,210
Accrued expenses 24,776 13,840
Payable to Sprint PCS 43,579 32,564
Deferred revenue 16,478 10,485
Capital lease obligations - short-term 4 --
---------- ---------
Total current liabilities 132,103 67,099
Other long-term liabilities 15,396 309
Long-term debt 556,396 266,326
Deferred income taxes 53,885 --
---------- ---------
Total liabilities 757,780 333,734
---------- ---------
Stockholders' equity (deficit):
Preferred stock, par value,
$0.01 per share; 5,000,000 shares
authorized; no shares issued and
outstanding -- --
Common stock, par value, $0.01 per
share; 150,000,000 shares authorized; 25,762,539 and 13,364,980
shares issued and outstanding at December 31, 2001 and
September 30, 2001,
respectively 258 134
Additional paid-in capital 923,088 168,255
Accumulated deficit (249,211) (219,567)
Unearned stock option compensation (1,315) (1,546)
---------- ---------
Total stockholders' equity (deficit) 672,820 (52,724)
Commitments and contingencies -- --
---------- ---------
Total liabilities and stockholders'
equity (deficit) $1,430,600 $ 281,010
========== =========
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