Alamosa Reports Second Quarter 2005 Results.LUBBOCK, Texas “Lubbock” redirects here. For other uses, see Lubbock (disambiguation). Lubbock is the 10th-largest city in the state of Texas.[1] Located in the northwestern part of the state—a region known historically as the Llano Estacado -- Highlights: --Income from Operations increased 166% to $34.9 million compared to first quarter pro-forma of $13.1 million --Adjusted 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 increased 33% to $91.7 million compared to first quarter pro-forma of $69.0 million --Exchanged 222,817 preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. units for 16.8 million newly issued shares of common stock --As previously announced: - Subscribers increased approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 52,000 to 1.447 million - Average monthly customer churn churn: see butter. declined to 2.1 percent Alamosa Holdings, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : APCS APCS Advanced Placement Computer Science APCS Air Pollution Control System APCS Argonne Premium Coal Sample APCS Automated Project Control System (NASA) APCS Assembly for the Promotion of Civil Society (Cuba) ), a 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. Affiliate Affiliate Relationship between two companies when one company owns substantial interest, but less than a majority of the voting stock of another company, or when two companies are both subsidiaries of a third company. See: Subsidiaries, parent company. of Sprint (NYSE NYSE See: New York Stock Exchange : FON Fon People of southern Benin and adjacent parts of Togo. They speak a dialect of Gbe, a Kwa language of the Niger-Congo language family. Numbering about 3 million, the Fon are mainly farmers. ) today reported financial and operational results for the second quarter ended June June: see month. 30, 2005. Reported results also reflect customer results for net subscriber subscriber, n the person, usually the employee, who represents the family unit in relation to the prepayment plan. Other family members are dependents. Also called certificate holders or enrollees. additions, total direct subscribers and average monthly customer churn previously reported on July July: see month. 15, 2005. For comparison purposes, the Company is also providing condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. pro-forma statements of operations and certain operating 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. for the four quarters of 2004 and the first quarter of 2005, assuming the acquisition of AirGate PCS, Inc. had taken place at the beginning of the respective quarters. Total consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: revenue for the second quarter was $339.4 million comprised of: $237.7 million in subscriber revenues, $90.0 million in travel revenues (including wholesale and resale resale n. selling again, particularly at retail. In many states a "resale license" or "resale number" is required so that the state can monitor the collection of sales tax on retail sales. RESALE. ) and $11.7 million in product sales revenues. Total consolidated revenue grew by 7% from the first quarter of 2005 and 22% from the second quarter of 2004, on a pro-forma basis. Total consolidated Adjusted EBITDA was $91.7 million for the second quarter compared to pro-forma total consolidated Adjusted EBITDA of $69.0 million in the first quarter of 2005 and $68.6 million in the second quarter of 2004. Income from Operations increased 166% or $21.8 million sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen to $34.9 million in the second quarter from $13.1 million in the first quarter on a pro-forma basis. On a year over year basis, Income from Operations increased $19.7 million on a pro-forma basis. The increase reflects the scale the Company is creating from growth in its subscriber base and growth in its 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. and wholesale revenue. The Company reported a second quarter net loss of $5.6 million or $0.04 per common share, after preferred stock dividends and inducement Inducement Electra incited brother, Orestes, to kill their mother and her lover. [Gk. Myth.: Zimmerman, 92; Gk. Lit.: Electra, Orestes] Hezekiah exhorts Judah to stand fast against Assyrians. [O.T. premiums of approximately $5.6 million and a $14.9 million loss on derivatives derivatives In finance, contracts whose value is derived from another asset, which can include stocks, bonds, currencies, interest rates, commodities, and related indexes. Purchasers of derivatives are essentially wagering on the future performance of that asset. associated with the preferred stock due to early conversions and the increase in fair value of stock warrants. The second quarter loss compares to a reported net loss of $3.1 million or $0.02 per common share, after preferred stock dividends, during the first quarter of 2005. On a pro-forma basis, the consolidated Company net loss was $3.9 million for the first quarter of 2005 and $20.1 million during the second quarter of 2004. During the quarter, the Company exchanged 222,817 preferred stock units for 16.8 million shares of newly issued common stock. In addition, the Company spent approximately $39.6 million on fixed asset additions including the launch of 117 new sites, 30 of which were in the former AirGate properties, in the second quarter increasing the covered population to 19.7 million. Net subscriber additions totaled 52,000 during the second quarter, including 3,000 purchased subscribers, compared to 81,000 net additions in the first quarter and 47,000 net additions in the same quarter one year ago on a pro-forma basis. The Company ended the second quarter with 1.447 million subscribers, a 22% increase over 1.188 million subscribers one year ago. The Company reported combined average monthly customer churn of 2.1 percent for the second quarter, compared to 2.3 percent in the first quarter of 2005 and 2.2 percent one year ago on a pro-forma basis. "The second quarter of 2005 was another great quarter for Alamosa. It was highlighted by passing the 1 million customer benchmark A performance test of hardware and/or software. There are various programs that very accurately test the raw power of a single machine, the interaction in a single client/server system (one server/multiple clients) and the transactions per second in a transaction processing system. in the original Alamosa territories along with new records in terms of Revenues, Adjusted EBITDA and average monthly customer churn," said David E. Sharbutt, Chairman and Chief Executive Officer of Alamosa Holdings, Inc. "Although net subscriber additions in the second quarter were seasonally lower, we achieved solid subscriber growth and continued our positive customer retention trends. We continued to expand and improve the network and distribution system in the Southeast Southeast or south east is the ordinal direction halfway between south and east. It the opposite of northwest. Southeast or South East can refer to: 1. produced artificially. 2. produced by induction. induced, adj artificially caused to occur. induced induction. preferred stock exchanges that significantly reduces our dividend requirements." Mr. Sharbutt concluded by stating, "We are focused on execution and the growth of our business for the second half of 2005."
SUMMARY OF SECOND QUARTER 2005 OPERATING STATISTICS
(a) Consolidated results include Holding Company activity, which is
not presented separately
Alamosa Alamosa Alamosa
Holdings Inc. Holdings Inc. Holdings Inc.
Alamosa (consolidated)(a) (consolidated)(a) (consolidated)(a)
(combined) Q2 2005 Q1 2005 Q2 2004
----------------- ----------------- -----------------
Service Revenue
(millions) $ 327.7 $ 303.3 $ 198.6
Adjusted EBITDA
(millions) $ 91.7 $ 69.0 $ 68.6
Net income
(loss)
(millions) $ (5.6) $ (3.9) $ (20.1)
---------------- ---------------- ----------------
Total Direct
Subscribers 1,447,000 1,395,000 1,188,000
Net Additions
(including
purchased
subscribers) 52,000 81,000 47,000
Wholesale/
Resale
Subscribers 282,000 266,000 112,000
----------------- ---------------- ----------------
ARPU (including
roaming &
wholesale) $ 77 $ 75 $ 76
ARPU (without
roaming &
wholesale) $ 56 $ 55 $ 56
CCPU (including
roaming) $ 43 $ 41 $ 43
CCPU (without
roaming) $ 29 $ 29 $ 31
CPGA $ 361 $ 358 $ 356
---------------- ---------------- ----------------
Other Select
Operating Alamosa Alamosa Alamosa
Metrics (Q2 (consolidated)(a) (consolidated)(a) (consolidated)(a)
2005)
----------------- ----------------- -----------------
Cash & ST
investment at
period-end
(millions) $ 159.9 $ 106.3 $ 43.9
Fixed Asset
Additions
during period
(millions) $ 39.6 $ 24.3 $ 15.3
---------------- ---------------- ----------------
Licensed POPs
(millions) 23.2 15.8 7.4
Covered POPs
(millions) 19.7 13.3 6.4
Churn (net of
30 day
returns) 2.1% 2.0% 2.4%
Penetration -
Covered POPs 7.3% 7.6% 6.7%
---------------- ---------------- ----------------
Total Voice
System Minutes
of Use (MOUs)
(millions) 4,520 3,066 1,454
Average Voice
MOUs Per User
(without
roaming) 767 723 869
Average Voice
MOUs Per User
(including
roaming) 953 904 1,069
Inbound Roaming
Minutes
(millions) 983 676 307
Inbound
Wholesale &
Resale Minutes
(millions) 260 235 25
Outbound
Roaming
Minutes
(millions) 796 538 258
---------------- ---------------- ----------------
BUSINESS OUTLOOK The following business outlook for 2005 may be materially affected by competitive conditions, continued development and acceptance of new Vision products and services, changes in pricing plans, the integration of AirGate PCS, Inc., the pending business combination between Sprint and Nextel (Nextel Communications, Inc., Reston, VA, www.nextel.com) A wireless communications carrier founded in New Jersey in 1987 as Fleet Call, a two-way radio service. Throughout the late 1980s and 1990s, the company acquired a large number of SMR (Specialized Mobile Radio) operators and turned and general economic conditions, among other things (See "Forward Looking Statements" below):
AirGate AirGate Alamosa
From Pro- Pro-Forma
February Forma Combined
Alamosa 16, 2005 Combined Year Year
---------------- ---------- --------- ---------- -------- -----------
Adjusted $ 250 $ 65 $ 315 $ 71.5 $ 321.5
EBITDA million million million million million
Fixed Asset $ 90 $ 50 $ 140
Additions million million million
Net Subscriber
Additions 165,000 40,000 205,000 56,000 221,000
Average
Monthly Churn
- less than 2.4% 2.6% 2.5% 2.6% 2.5%
CURRENT DEVELOPMENT As announced on August 8, 2005, AirGate PCS, Inc., a wholly-owned subsidiary of Alamosa, filed a lawsuit lawsuit: see procedure; tort. against Sprint, certain of its affiliates and Nextel Communications Nextel Communications, styled NEXTEL, (Former NASDAQ: NXTL) which is now known as the Sprint Nextel Corporation was a telecommunications firm based in the United States. Known for providing a nation-wide mobile communications system. , Inc. in the Delaware Delaware, state, United States Delaware (dĕl`əwâr, –wər), one of the Middle Atlantic states of the United States, the country's second smallest state (after Rhode Island). Court of Chancery court of chancery n. pl. courts of chancery A court with jurisdiction in equity. Noun 1. court of chancery - a court with jurisdiction in equity chancery alleging, among other things, that following the completion of their pending merger, Sprint may breach the exclusivity covenants contained in its management agreement with AirGate and that Nextel unlawfully UNLAWFULLY, pleadings. This word is frequently used in indictments in the description of the offence; it is necessary when the crime did not exist at common law, and when a statute, in describing an offence which it creates, uses the word, 1 Moody, Cr. Cas. interfered with AirGate's exclusive rights under such agreement. The complaint seeks, among other things, an order directing Sprint and its affiliates to specifically perform their contractual obligations under their agreements with AirGate, an injunction injunction, in law, order of a court directing a party to perform a certain act or to refrain from an act or acts. The injunction, which developed as the main remedy in equity, is used especially where money damages would not satisfy a plaintiff's claim, or to preventing Sprint and Nextel from taking any action or entering into any agreement that would violate the exclusivity covenants contained in the agreements, a declaratory judgment declaratory judgment In law, a judgment merely declaring a right or establishing the legal status or interpretation of a law or instrument. It is binding but is distinguished from other judgments or court opinions in that it includes no executive element (an order that declaring the rights, remedies rem·e·dy n. pl. rem·e·dies 1. Something, such as medicine or therapy, that relieves pain, cures disease, or corrects a disorder. 2. Something that corrects an evil, fault, or error. 3. and obligations of the parties under the agreements, and damages or other relief. SECOND QUARTER EARNINGS RELEASE & CONFERENCE CALL Alamosa has scheduled a conference call, which will be broadcast live over the 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 , on Wednesday Wednesday: see week. , August 10, 2005 at 9:00 a.m. ET. Investors and analysts may access the call live via phone by dialing 913-981-5543 and asking for the Alamosa call 10 minutes prior to the start time or listen live over the Internet by logging on to www.alamosapcs.com or www.earnings.com. A telephonic replay of the conference call will be available through Wednesday, August 17, 2005, and may be accessed by calling 719-457-0820 and using the passcode 9400564. An audio archive (1) A file that contains one or more compressed files. Most archive formats are also capable of storing folders in order to reconstruct the file/folder relationship when decompressed. See archive formats. will be available shortly after the call on the company's website at www.alamosapcs.com or www.earnings.com for 30 days. ABOUT ALAMOSA Alamosa Holdings, Inc. is the largest (based on number of subscribers) PCS Affiliate of Sprint (NYSE: FON), which operates the largest all-digital, all-CDMA Third-Generation (3G) wireless network 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. . Alamosa has the exclusive right to provide digital wireless mobility communications network The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. services under the Sprint brand name throughout its designated territory located in Texas, New Mexico New Mexico, state in the SW United States. At its northwestern corner are the so-called Four Corners, where Colorado, New Mexico, Arizona, and Utah meet at right angles; New Mexico is also bordered by Oklahoma (NE), Texas (E, S), and Mexico (S). , Oklahoma Oklahoma (ōkləhō`mə), state in SW United States. It is bordered by Missouri and Arkansas (E); Texas, partially across the Red R. (S, W); New Mexico, across the narrow edge of the Oklahoma Panhandle (W); and Colorado and Kansas (N). , Arizona Arizona (âr'əzō`nə), state in the southwestern United States. It is bordered by Utah (N), New Mexico (E), Mexico (S), and, across the Colorado R., Nevada and California (W). , Colorado Colorado, state, United States Colorado (kŏlərăd`ə, –răd`ō, –rä`dō), state, W central United States, one of the Rocky Mt. states. , Utah, Wisconsin Wisconsin, state, United States Wisconsin (wĭskŏn`sən, –sĭn), upper midwestern state of the United States. It is bounded by Lake Superior and the Upper Peninsula of Michigan, from which it is divided by the Menominee , Minnesota Minnesota, state, United States Minnesota (mĭn'ĭsō`tə), upper midwestern state of the United States. It is bordered by Lake Superior and Wisconsin (E), Iowa (S), South Dakota and North Dakota (W), and the Canadian provinces , Missouri Missouri, state, United States Missouri (mĭz  r`ē, –ə), one of the midwestern states of the United States. ,
Washington Washington, town, EnglandWashington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. , Oregon Oregon, city, United States Oregon, city (1990 pop. 18,334), Lucas co., NW Ohio, a suburb adjacent to Toledo, on Lake Erie; inc. 1958. It is a port with railroad-owned and -operated docks. The city has industries producing oil, chemicals, and metal products. , Arkansas Arkansas, river, United States Arkansas (ärkăn`zəs, är`kənsô'), river, c.1,450 mi (2,330 km) long, rising in the Rocky Mts., central Colo. , Kansas, Illinois Kansas is a village in Edgar County, Illinois, United States. The population was 842 at the 2000 census. Geography Kansas is located at (39.553627, -87.938392)GR1. , California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). , Georgia Georgia, country, Asia Georgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. , 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. , North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. and Tennessee Tennessee, state, United States Tennessee (tĕn`əsē', tĕn'əsē`), state in the south-central United States. . Alamosa's territory includes licensed population of 23.2 million residents, including 15.8 million residents in Alamosa's territories and 7.4 million residents in the recently acquired AirGate properties. ABOUT SPRINT Sprint offers an extensive range of innovative communication products and solutions, including global IP, wireless, local and multi-product bundles. A Fortune 100 company with more than $27 billion in annual revenues in 2004, 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; an award-winning Adj. 1. award-winning - having received awards; "this award-winning bridge spans a distance of five miles" 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. ; and one of the largest 100-percent digital, nationwide wireless networks in the United States. For more information, visit www.sprint.com/mr. FORWARD LOOKING STATEMENTS Statements contained in this news release that are 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. including "Business Outlook" data and statements containing terms such as "can", "may", "will", "expect", "plan", and similar terms and statements about the benefits of the merger between Alamosa and AirGate PCS, Inc, are subject to various risks and uncertainties. Such forward-looking statements are made pursuant to the "safe-harbor" provisions of 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 and are made based on management's current expectations or beliefs as well as assumptions made by, and information currently available to, management. A variety of factors could cause actual results to differ materially from those anticipated in Alamosa's forward-looking statements, including the following factors: Alamosa's dependence on its affiliation affiliation (  fil´ēā´sh with Sprint;
shifts in populations or network focus; changes or advances in
technology; changes in Sprint's national service plans or fee
structure with us; change in population; difficulties in network
construction; increased competition in our markets and adverse changes
in financial position, condition or results of operations and as
outlined in the "Business Outlook" section of this release,
competitive conditions, continued development and acceptance of new
Vision products and services, changes in pricing plans, the integration
of AirGate PCS, Inc., the pending business combination between Sprint
and Nextel and general economic conditions, among other things. For a
detailed discussion of these and other cautionary statements and factors
that could cause actual results to differ from Alamosa's
forward-looking statements, please refer to Alamosa's filings with
the Securities and Exchange Commission, especially in the "risk
factors" sections of Alamosa's Annual Report on Form 10-K Form 10-KA 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 December: see month. 31, 2004 and in subsequent filings with the Securities and Exchange Commission. Investors and analysts should not place undue reliance on forward-looking statements. Definitions of Operating and Non-GAAP Financial Measures We provide readers financial measures generated using 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 ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ") and using adjustments to GAAP ("Non-GAAP"). These financial measures reflect conventions or standard measures of liquidity, profitability or performance commonly used by the investment community in the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. industry for comparability purposes. The Non-GAAP financial measures used in this release include the following: -- Adjusted 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.
disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures) items. Adjusted EBITDA is a measure used by the investment community in the telecommunications industry for comparability and is not intended to represent the results of our operations in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP. The financial measures and other operating metrics used in this release include the following: -- 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. , or average monthly revenue per user, is a measure used to determine the average monthly subscriber revenue earned for subscribers based in our territory. This measure is calculated by dividing subscriber revenues (ARPU) or total service revenues (ARPU with roaming) in our consolidated statement of operations See Income statement. by our average daily subscribers during the period divided by the number of months in the period. -- CCPU CCPU Continuous Computing Corporation (stock symbol) CCPU Cash Cost Per User (Sprint) CCPU China Criminal Police University CCPU Cryptographic Central Processing Unit , or cash cost per user, is a measure of the costs to operate our business on a per subscriber basis consisting of costs of service and operations, general and administrative expenses and debt exchange expenses in our consolidated statement of operations, plus handset The part of the telephone that contains the speaker and the microphone. On a desktop phone, the part you hold in your hand is the handset. On a cellphone, the entire phone is the handset. See multihandset cordless and headset. subsidies on equipment sold to existing subscribers (CCPU with roaming) less roaming charges paid to Sprint PCS (CCPU before roaming). These costs are divided by average daily subscribers during the period divided by the number of months in the period to calculate CCPU. -- CPGA (Ceramic PGA) See PGA. CPGA - Ceramic Pin Grid Array , or cost per gross addition, is used to measure the average cost we incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. to add a new subscriber in our territory. Costs we incur in calculating this measure include handset subsidies on new subscriber activations, commissions, rebates and other selling and marketing costs. We calculate CPGA by dividing (a) the sum of cost of products sold and selling and marketing expenses associated with transactions with new subscribers during the measurement period, less product sales revenues associated with transactions with new subscribers during the measurement period, by (b) the total number of subscribers activated activated a state of being more than usually active. In biological systems this is usually brought about by chemical or electrical means. Commonly said of pharmaceutical and chemical products. in our territory during the period (net of activations deactivated within 30 days and activations due to transfers from Sprint PCS and other PCS Affiliates of Sprint into our territory). -- Average monthly churn is used to measure the rate at which subscribers based in our territory deactivate de·ac·ti·vate tr.v. de·ac·ti·vat·ed, de·ac·ti·vat·ing, de·ac·ti·vates 1. To render inactive or ineffective. 2. To inhibit, block, or disrupt the action of (an enzyme or other biological agent). 3. service on a voluntary or involuntary involuntary adj. or adv. without intent, will, or choice. Participation in a crime is involuntary if forced by immediate threat to life or health of oneself or one's loved ones, and will result in dismissal or acquittal. INVOLUNTARY. basis. We calculate average monthly churn based on the number of subscribers deactivated during the period (net of transfers out of our service area and those who deactivated within 30 days of activation activation /ac·ti·va·tion/ (ak?ti-va´shun) 1. the act or process of rendering active. 2. the transformation of a proenzyme into an active enzyme by the action of a kinase or another enzyme. 3. ) as a percentage of our average daily subscriber base during the period divided by the number of months during the period. -- Licensed POPs represent the number of residents (usually expressed in millions) in our territory in which we have an exclusive right to provide wireless mobility communications services under the Sprint brand name in the PCS wireless spectrum. The number of residents located in our territory does not represent the number of wireless subscribers that we serve or expect to serve in our territory. -- Covered POPs represent the number of residents (usually expressed in millions) covered by our portion of the PCS network of Sprint in our territory. The number of residents covered by our network does not represent the number of wireless subscribers that we serve or expect to serve in our territory.
ALAMOSA HOLDINGS,INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(dollars in thousands, except share information)
June 30, December 31,
2005 2004
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 69,298 $ 129,917
Short term investments 90,642 50,418
Customer accounts receivable, net 85,399 44,687
Receivable from Sprint 20,677 24,809
Interest receivable 228 216
Inventory 13,845 9,136
Prepaid expenses and other assets 19,476 13,170
Deferred customer acquisition costs 5,614 6,337
Deferred tax asset 4,450 4,230
------------ ------------
Total current assets 309,629 282,920
Property and equipment, net 539,684 441,808
Debt issuance costs, net 8,561 9,086
Early redemption option on preferred
stock 7,451 21,387
Goodwill 245,087 --
Intangible assets, net 793,839 416,716
Other noncurrent assets 5,671 4,188
------------ ------------
Total assets $ 1,909,922 $ 1,176,105
============ ============
LIABILITIES, MANDATORILY REDEEMABLE CONVERTIBLEPREFERRED STOCK AND
STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 29,207 $ 24,692
Accrued expenses 55,007 43,916
Payable to Sprint 35,902 35,852
Interest payable 23,589 21,076
Deferred revenue 25,844 22,549
Current installments of capital leases 110 110
------------ ------------
Total current liabilities 169,659 148,195
------------ ------------
Long term liabilities:
Capital lease obligations 695 749
Other noncurrent liabilities 9,413 5,835
Deferred tax liability 33,844 16,362
Senior notes 1,092,872 739,141
------------ ------------
Total long term liabilities 1,136,824 762,087
------------ ------------
Total liabilities 1,306,483 910,282
------------ ------------
Commitments and contingencies -- --
Mandatorily redeemable convertible
preferred stock:
Series B preferred stock, $.01 par
value; 750,000 shares authorized;
225,363 and 478,987 shares issued
and outstanding, respectively 75,820 161,148
Series C preferred stock, $.01 par
value; 500,000 shares authorized; no
shares issued -- --
------------ ------------
Total mandatorily redeemable
convertible
preferred stock 75,820 161,148
------------ ------------
Stockholders' equity:
Preferred stock, $.01 par value;
8,750,000
shares authorized; no shares issued -- --
Common stock, $.01 par value;
290,000,000
shares authorized; 162,659,994 and
114,895,245 shares issued and
outstanding, respectively 1,627 1,149
Additional paid-in capital 1,285,186 860,425
Accumulated deficit (757,080) (756,834)
Unearned compensation (2,114) (65)
------------ ------------
Total stockholders' equity 527,619 104,675
------------ ------------
Total liabilities and stockholders'
equity $ 1,909,922 $ 1,176,105
============ ============
ALAMOSA HOLDINGS, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(dollars in thousands, except per share amounts)
For the three months ended
June 30,
---------------------------
2005 2004
------------ ------------
Revenues:
Subscriber revenues $ 237,692 $ 133,569
Roaming and wholesale revenues 89,967 51,705
------------ ------------
Service revenues 327,659 185,274
Product sales 11,720 8,055
------------ ------------
Total revenue 339,379 193,329
------------ ------------
Costs and expenses:
Cost of service and operations 162,596 91,062
Cost of products sold 29,953 16,379
Selling and marketing 46,011 31,839
General and administrative expenses 9,135 5,706
Merger related expenses -- --
Depreciation and amortization 55,905 25,523
Loss on disposal of property and
equipment 131 2,604
Non-cash compensation 716 25
------------ ------------
Total costs and expenses 304,447 173,138
------------ ------------
Income from operations 34,932 20,191
Loss on debt extinguishment (482) --
Gain (loss) on derivative instrument (14,925) (11,926)
Interest and other income 1,573 221
Interest expense (25,295) (18,952)
------------ ------------
Loss before income taxes (4,197) (10,466)
Income tax (expense) benefit 4,193 (240)
------------ ------------
Net loss (4) (10,706)
Preferred stock dividend (851) (2,576)
Preferred stock conversion premium (4,777) (6,441)
------------ ------------
Net loss attributable to common
stockholders $ (5,632)$ (19,723)
============ ============
Net loss per common share, basic
and diluted $ (0.04)$ (0.19)
============ ============
Weighted average common shares
outstanding, basic and diluted 157,080,740 101,885,776
============ ============
For the six months ended
June 30,
---------------------------
2005 2004
------------ ------------
Revenues:
Subscriber revenues $ 427,672 $ 258,315
Roaming and wholesale revenues 158,144 94,858
------------ ------------
Service revenues 585,816 353,173
Product sales 21,335 16,846
------------ ------------
Total revenue 607,151 370,019
------------ ------------
Costs and expenses:
Cost of service and operations 284,871 177,278
Cost of products sold 58,532 36,162
Selling and marketing 91,288 62,832
General and administrative expenses 18,315 11,423
Merger related expenses 1,280 --
Depreciation and amortization 96,559 52,907
Loss on disposal of property and
equipment 107 2,910
Non-cash compensation 1,487 51
------------ ------------
Total costs and expenses 552,439 343,563
------------ ------------
Income from operations 54,712 26,456
Loss on debt extinguishment (482) (13,101)
Gain (loss) on derivative instrument (14,076) 746
Interest and other income 2,673 389
Interest expense (47,649) (37,187)
------------ ------------
Loss before income taxes (4,822) (22,697)
Income tax (expense) benefit 4,576 (557)
------------ ------------
Net loss (246) (23,254)
Preferred stock dividend (3,000) (5,796)
Preferred stock conversion premium (5,506) (6,441)
------------ ------------
Net loss attributable to common
stockholders $ (8,752)$ (35,491)
============ ============
Net loss per common share, basic and
diluted $ (0.06) $ (0.36)
============ ============
Weighted average common shares
outstanding, basic and diluted 143,090,447 98,688,272
============ ============
ALAMOSA HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(dollars in thousands)
For the six months ended
June 30,
--------------------------
2005 2004
------------- ------------
Cash flows from operating activities:
Net loss $ (246) $ (23,254)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Non-cash compensation 1,487 51
Non-cash interest expense on derivative
instruments -- 6
Non-cash accretion of asset retirement
obligations 144 91
Non-cash (gain) loss on derivative
instruments 14,076 (746)
Provision for bad debts 5,173 4,114
Depreciation and amortization of property
and equipment 48,681 35,945
Amortization of intangible assets 47,878 16,962
Amortization of financing costs included
in interest expense 454 488
Amortization of debt premium (1,442) --
Loss on debt extinguishment 482 13,101
Interest accreted on discount notes 13,171 12,056
Deferred income taxes (220) --
Loss on disposal of property and
equipment 107 2,910
Merger related expenses 1,280 --
(Increase) decrease in:
Receivables (985) (12,579)
Inventory (378) 17
Prepaid expenses and other assets (1,394) 1,633
Increase (decrease) in:
Accounts payable and accrued expenses (54,271) 10,891
------------- ------------
Net cash provided by operating
activities 73,997 61,686
------------- ------------
Cash flows from investing activities:
Proceeds from sale of assets 214 380
Purchases of property and equipment (65,617) (42,636)
Net cash paid in business combination (69,831) --
Merger related expenses (436) --
Change in restricted cash -- 1
Change in short term investments 4,400 (50,119)
------------- ------------
Net cash used in investing activities (131,270) (92,374)
------------- ------------
Cash flows from financing activities:
Proceeds from issuance of senior notes -- 250,000
Redemption of senior notes (6,800) --
Repayments of borrowings under senior
secured debt -- (200,000)
Merger related expenses (844) --
Debt issuance costs -- (8,100)
Preferred stock dividends (3,793) (6,053)
Preferred stock conversion premium -- (116)
Stock options exercised 7,876 719
Shares issued to employee stock purchase
plan 267 492
Proceeds from restricted stock sales 2 --
Payments on capital leases (54) (330)
------------- ------------
Net cash provided by (used in)
financing activities (3,346) 36,612
------------- ------------
Net increase (decrease) in cash and cash
equivalents (60,619) 5,924
Cash and cash equivalents at beginning of
period 129,917 99,644
------------- ------------
Cash and cash equivalents at end of period $ 69,298 $ 105,568
============= ============
Supplemental disclosure of non-cash
financing and investing activities:
Stock issued in business combination $ 330,848 $ --
Warrants assumed in business combination 2,568 --
Fair value of assets acquired in business
combination 879,084 --
Fair value of liabilities assumed in
business combination (441,518) --
Conversion of preferred stock 85,328 65,626
Preferred stock issued in debt exchange -- 51
Non-cash fixed asset additions 127 --
Asset retirement obligations capitalized 321 75
Capitalized lease obligations incurred -- 67
Change in accounts payable for purchases
of property and equipment 3,855 (11,186)
ALAMOSA HOLDINGS INC.
BALANCE SHEETS
AS OF JUNE 30, 2005
Alamosa AirGate PCS, Alamosa
(Delaware), Inc. Holdings,
Inc. Inc.
------------ ------------- ------------
ASSETS
Current Assets:
Cash and cash equivalents $55,206 $4,366 $69,298
Short term investments 51,087 39,549 90,642
Customer accounts
receivable, net 58,761 26,638 85,399
Receivable from Sprint 17,285 3,392 20,677
Interest receivable 228 -- 228
Intercompany receivable 20,606 -- --
Inventory 10,024 3,821 13,845
Prepaid expenses and other
assets 12,146 7,019 19,476
Deferred customer
acquisition costs 5,362 252 5,614
Deferred tax asset 4,230 7,611 4,450
------------ ------------- ------------
Total current assets 234,935 92,648 309,629
Property and equipment, net 449,040 90,644 539,684
Debt issuance costs, net 8,561 -- 8,561
Early redemption option on
preferred stock -- -- 7,451
Goodwill -- 255,305 245,087
Intangible assets, net 401,583 392,256 793,839
Other noncurrent assets 4,268 1,403 5,671
------------ ------------- ------------
Total assets $1,098,387 $832,256 $1,909,922
============ ============= ============
LIABILITIES, MANDATORILY REDEEMABLE CONVERTIBLE PREFERRED STOCK AND
STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $23,808 $5,399 $29,207
Accrued expenses 51,027 14,787 55,007
Payable to Sprint 23,424 12,478 35,902
Interest payable 21,077 2,512 23,589
Intercompany payable -- 3,010 --
Deferred revenue 19,890 5,954 25,844
Current installments of
capital leases 110 -- 110
------------ ------------- ------------
Total current
liabilities 139,336 44,140 169,659
Capital lease obligations 695 -- 695
Other noncurrent liabilities 6,018 1,070 9,413
Deferred tax liability 16,605 27,700 33,844
Senior notes 745,923 346,949 1,092,872
------------ ------------- ------------
Total liabilities 908,577 419,859 1,306,483
------------ ------------- ------------
Mandatorily redeemable
convertible preferred stock -- -- 75,820
------------ ------------- ------------
Stockholders' Equity:
Preferred stock -- -- --
Common stock -- -- 1,627
Additional paid-in capital 932,059 424,560 1,285,186
Accumulated deficit (740,512) (12,163) (757,080)
Unearned compensation (1,737) -- (2,114)
------------ ------------- ------------
Total stockholders'
equity 189,810 412,397 527,619
------------ ------------- ------------
Total liabilities and
stockholders' equity $1,098,387 $832,256 $1,909,922
============ ============= ============
ALAMOSA HOLDINGS, INC.
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 2005
Alamosa AirGate PCS, Alamosa
(Delaware), Inc. Holdings,
Inc. Inc.
------------ ------------- ------------
Revenues:
Subscriber revenues $163,871 $73,821 $237,692
Roaming and wholesale
revenues 66,289 24,776 89,967
------------ ------------- ------------
Service revenues 230,160 98,597 327,659
Product sales 8,715 3,005 11,720
------------ ------------- ------------
Total revenue 238,875 101,602 339,379
Costs and expenses:
Cost of service and
operations 110,615 53,079 162,596
Cost of products sold 22,255 7,698 29,953
Selling and marketing 33,618 12,393 46,011
General and administrative
expenses 3,509 5,373 9,135
Depreciation and
amortization 28,107 27,798 55,905
Loss on disposal of
property and equipment 131 -- 131
Non-cash compensation (47) 550 716
------------ ------------- ------------
Income (loss) from
operations 40,687 (5,289) 34,932
Loss on debt extinguishment (482) -- (482)
Loss on derivative
instruments -- -- (14,925)
Interest and other income 831 706 1,573
Interest expense (19,566) (5,729) (25,295)
------------ ------------- ------------
Income (loss) before
income taxes 21,470 (10,312) (4,197)
Income tax (expense) benefit (5,493) 3,966 4,193
------------ ------------- ------------
Net income (loss) $15,977 $(6,346) $(4)
============ ============= ============
ALAMOSA HOLDINGS, INC.
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2005
Alamosa AirGate PCS, Alamosa
(Delaware), Inc. Holdings,
Inc. Inc.
------------ ------------- ------------
Revenues:
Subscriber revenues $318,902 $108,770 $427,672
Roaming and wholesale
revenues 126,895 32,916 158,144
------------ ------------- ------------
Service revenues 445,797 141,686 585,816
Product sales 16,682 4,653 21,335
------------ ------------- ------------
Total revenues 462,479 146,339 607,151
Costs and expenses:
Cost of services and
operations 212,098 74,440 284,871
Cost of products sold 46,406 12,126 58,532
Selling and marketing 70,138 21,150 91,288
General and administrative
expenses 9,611 8,272 18,315
Merger related expenses 436 -- 1,280
Depreciation and
amortization 54,456 42,103 96,559
Loss on disposal of
property and equipment 107 -- 107
Non-cash compensation 556 550 1,487
------------ ------------- ------------
Income (loss) from
operations 68,671 (12,302) 54,712
Loss on debt extinguishment (482) -- (482)
Loss on derivative
instruments -- -- (14,076)
Interest and other income 1,599 1,025 2,673
Interest expense (39,152) (8,497) (47,649)
------------ ------------- ------------
Income (loss) before
income taxes 30,636 (19,774) (4,822)
Income tax (expense) benefit (7,044) 7,611 4,576
------------ ------------- ------------
Net income (loss) $23,592 $(12,163) $(246)
============ ============= ============
ALAMOSA HOLDINGS, INC.
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2005
Alamosa AirGate PCS, Alamosa
(Delaware), Inc. Holdings,
Inc. Inc.
------------ ------------- ------------
Cash flows from operating
activities:
Net income (loss) $23,592 $(12,163) $(246)
Adjustments to reconcile net
income (loss) to net cash
provided by (used in)
operating activities:
Non-cash compensation 556 550 1,487
Non-cash accretion of asset
retirement obligation 115 29 144
Non-cash loss on derivative
instruments -- -- 14,076
Provision for bad debts 3,863 1,310 5,173
Depreciation and
amortization of property
and equipment 39,323 9,358 48,681
Amortization of intangible
assets 15,133 32,745 47,878
Amortization of financing
costs included in interest
expense 454 -- 454
Amortization of debt premium -- (1,442) (1,442)
Loss on debt extinguishment 482 -- 482
Interest accreted on
discount notes 13,171 -- 13,171
Deferred income taxes -- (7,611) (220)
Loss on disposal of property
and equipment 107 -- 107
Merger related expenses 436 -- 1,280
(Increase) decrease in:
Receivable from/payable to
Parent (22,136) 2,460 --
Receivables (10,426) 9,441 (985)
Inventory (888) 510 (378)
Prepaid expenses and
other assets (59) (3,003) (1,394)
Increase (decrease) in:
Accounts payable and
accrued expenses (6,466) (36,144) (54,271)
------------ ------------- ------------
Net cash provided by
(used in) operating
activities 57,257 (3,960) 73,997
------------ ------------- ------------
Cash flows from investing
activities:
Proceeds from sale of assets 214 -- 214
Purchases of property and
equipment (47,555) (18,062) (65,617)
Net cash paid in business
combination -- 36,314 (69,831)
Merger related expenses (436) -- (436)
Change in short term
investments (676) 5,074 4,400
------------ ------------- ------------
Net cash provided by
(used in) investing
activities (48,453) 23,326 (131,270)
------------ ------------- ------------
Cash flows from financing
activities:
Redemption of senior notes (6,800) -- (6,800)
Merger related expenses -- -- (844)
Preferred stock dividends -- -- (3,793)
Stock options exercised -- -- 7,876
Shares issued to employee
stock purchase plan -- -- 267
Proceeds from restricted
stock sales -- -- 2
Capital distribution to
Parent (73,876) (15,000) --
Payments on capital leases (54) -- (54)
------------ ------------- ------------
Net cash provided by
(used in) financing
activities (80,730) (15,000) (3,346)
------------ ------------- ------------
Net increase (decrease)
in cash and cash
equivalents (71,926) 4,366 (60,619)
Cash and cash equivalents at
beginning of period 127,132 -- 129,917
------------ ------------- ------------
Cash and cash equivalents at
end of period $55,206 $4,366 $69,298
============ ============= ============
Supplemental disclosure of
non-cash financing and
investing activities:
Capital infusion in business
combination $-- $333,416 $--
Stock issued in business
combination -- -- 330,848
Warrants assumed in business
combination -- -- 2,568
Fair value of assets
acquired in business
combination -- 888,920 879,084
Fair value of liabilities
assumed in business
combination -- (449,552) (441,518)
Conversion of preferred
stock -- -- 85,328
Non-cash fixed asset
additions 127 -- 127
Asset retirement obligations
capitalized 292 28 321
Change in accounts payable
for purchases of property
and equipment (973) 4,827 3,855
Computation of Adjusted EBITDA and Reconciliation of Non-GAAP
Liquidity Measures
(Unaudited)
(In thousands)
Alamosa Alamosa
Holdings, (Delaware), AirGate PCS,
Inc. Inc. Inc.
---------------------------------------
For the For the For the
three three three
months months months
ended June ended June ended June
30, 30, 30,
2005 2005 2005
------------ ------------- ------------
Net income (loss) $(4) $15,977 $(6,346)
Income tax expense (benefit) (4,193) 5,493 (3,966)
Net interest expense 23,722 18,735 5,023
Depreciation and amortization 55,905 28,107 27,798
Non-cash compensation 716 (47) 550
Loss on debt extinguishment 482 482 -
(Gain) loss on derivative
instruments 14,925 - -
(Gain) loss on disposal of
property and equipment 131 131 -
------------ ------------- ------------
Adjusted EBITDA 91,684 68,878 23,059
Provision for bad debts 3,454 2,090 1,364
Non-cash accretion of asset
retirement obligation 74 60 14
Non-cash interest items 5,825 6,826 (1,001)
Cash income tax (expense)
benefit 3,973 (5,493) -
Net interest expense (23,722) (18,735) (5,023)
Working capital changes (16,605) 8,070 (17,754)
------------ ------------- ------------
Cash flows from operating
activities $64,683 $61,696 $659
============ ============= ============
Computation of Average Revenue per User (ARPU)
Computation of Cash Cost per User (CCPU)
(Unaudited)
Alamosa Alamosa
Holdings, (Delaware), AirGate PCS,
Inc. Inc. Inc.
---------------------------------------
For the For the For the
three three three
months months months
ended June ended June ended June
30, 30, 30,
2005 2005 2005
------------ ------------- ------------
Subscriber revenues (000s) $237,692 $163,871 $73,821
Roaming and wholesale revenue
(000s) 89,967 66,289 24,776
------------ ------------- ------------
Service revenue (000s) $327,659 $230,160 $98,597
============ ============= ============
Average subscribers (000s) 1,424 994 430
============ ============= ============
ARPU $56 $55 $57
============ ============= ============
ARPU with roaming $77 $77 $76
============ ============= ============
Cost of service and
operations (000s) $162,596 $110,615 $53,079
Less roaming expense (000s) (57,058) (37,852) (20,304)
General and administrative
expenses (000s) 9,135 3,509 5,373
Merger related expenses
(000s) -- -- --
Upgrade costs in selling and
marketing expenses (000s) 10,400 7,610 2,790
------------ ------------- ------------
$125,073 $83,882 $40,938
============ ============= ============
Average subscribers(000s) 1,424 994 430
============ ============= ============
CCPU $29 $28 $32
============ ============= ============
CCPU with roaming $43 $41 $47
============ ============= ============
Computation of Cost per Gross Addition (CPGA)
(Unaudited)
Alamosa Alamosa AirGate PCS,
Holdings, (Delaware), Inc.
Inc. Inc.
---------------------------------------
For the For the For the
three three three
months months months
ended June ended June ended June
30, 30, 30,
2005 2005 2005
------------ ------------- ------------
Selling and marketing
expenses (000s) $46,011 $33,618 $12,393
Less upgrade costs in selling
and marketing costs(000s) (10,400) (7,610) (2,790)
Cost of products sold(000s) 29,953 22,255 7,698
Product sales revenues(000s) (11,720) (8,715) (3,005)
------------ ------------- ------------
$53,844 $39,548 $14,296
============ ============= ============
Activations (000s) 151 109 42
============ ============= ============
CPGA $357 $363 $340
============ ============= ============
Unaudited Pro Forma Statements Pro forma statement A financial statement showing the forecast or projected operating results and balance sheet, as in pro forma income statements, balance sheets, and statements of cash flows. of Operations and Operating Metrics The unaudited pro forma statements of operations and operating metrics for the quarters ended March 31, 2004, June 30, 2004, September September: see month. 30, 2004, December 31, 2004 and March 31, 2005 present the effects of the acquisition of AirGate PCS, Inc. by Alamosa Holdings, Inc. using the purchase method of accounting assuming the transaction had been completed as of the beginning of the respective periods. The pro forma statements were prepared using historical unaudited quarterly financial statements of AirGate and Alamosa. Adjustments to the historical statements of operations include (i) the elimination of intercompany travel revenue and expense, (ii) amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. recorded in connection with the acquisition, (iii) decrease in depreciation of property and equipment based on the fair value of AirGate property and equipment recorded in connection with the transaction, (iv) reduction in interest expense based on the fair value of AirGate debt recorded in connection with the transaction, and (v) the tax effect of all 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 adjustments using the historical effective tax rate. The unaudited pro forma condensed consolidated financial information is for illustrative il·lus·tra·tive adj. Acting or serving as an illustration. il·lus  tra·tive·ly adv.Adj. 1. purposes only and does not purport To convey, imply, or profess; to have an appearance or effect. The purport of an instrument generally refers to its facial appearance or import, as distinguished from the tenor of an instrument, which means an exact copy or duplicate. PURPORT, pleading. to represent what the actual consolidated results of operations or the consolidated financial position of Alamosa Holdings would have been had the transaction occurred on the dates assumed, nor is it necessarily indicative indicative: see mood. of future consolidated results of operations or financial position. The unaudited pro forma condensed consolidated financial information does not include the realization (specification) realization - A UML semantic relationship between a classifier that specifies a contract and another classifier that guarantees to carry it out. [Handout by Mr. David Gillibrand]. of any cost savings from operating efficiencies, synergies or other restructurings resulting from the transaction. The unaudited pro forma condensed consolidated financial information should be read in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with the separate historical consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge and accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. notes of Alamosa Holdings, Inc. and AirGate PCS, Inc.
Alamosa Holdings, Inc.
Pro Forma Statements of Operations
Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005
(000s) Pro Forma Pro Forma Pro Forma Pro Forma Pro Forma
---------- ---------- ---------- ---------- ----------
Revenues:
Service
Revenues $186,402 $198,606 $209,245 $218,945 $224,660
Travel and
Roaming 55,835 68,186 80,514 81,621 78,590
---------- ---------- ---------- ---------- ----------
Total
Service
Revenues 242,237 266,792 289,759 300,566 303,250
Product Sales 11,673 11,667 12,208 12,415 12,826
---------- ---------- ---------- ---------- ----------
Total
Revenue 253,910 278,459 301,967 312,981 316,076
---------- ---------- ---------- ---------- ----------
Costs and
expenses:
Cost of service
& operations 124,815 133,418 134,543 154,602 145,276
Cost of
products sold 26,985 23,049 28,916 29,995 35,107
Selling and
marketing 42,909 42,729 54,018 53,334 54,570
General and
Administrative 12,054 10,676 10,485 10,498 12,103
Depreciation
and
amortization 52,476 50,738 51,241 55,175 55,168
(Gain) loss on
disposal of
property and
equipment 303 2,602 227 941 (4)
Non cash
compensation 26 25 30 802 771
---------- ---------- ---------- ---------- ----------
Total costs
and
expenses 259,568 263,237 279,460 305,347 302,991
---------- ---------- ---------- ---------- ----------
Income
(Loss)
from
operations (5,658) 15,222 22,507 7,634 13,085
Loss on debt
exchange (13,101) - - (2,991) -
Change in fair
value of
derivatives 12,672 (11,926) 1,200 (2,251) 849
Interest and
other income 333 409 599 1,253 1,446
Interest
expense (25,815) (23,325) (24,751) (26,213) (25,468)
---------- ---------- ---------- ---------- ----------
Loss before
income tax (31,569) (19,620) (445) (22,568) (10,088)
Income Tax
Benefit/
(Expense) (818) (450) - 1,038 6,181
---------- ---------- ---------- ---------- ----------
Net loss $(32,387) $(20,070) $(445) $(21,530) $(3,907)
========== ========== ========== ========== ==========
Alamosa Holdings, Inc.
Pro Forma Operating Metrics
Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005
(000s) Pro Forma Pro Forma Pro Forma Pro Forma Pro Forma
---------- ---------- ---------- ---------- ----------
Subscriber
revenues $186,402 $198,606 $209,245 $218,945 $224,660
Roaming and
wholesale
revenues 55,835 68,186 80,514 81,621 78,590
---------- ---------- ---------- ---------- ----------
Total
Service
Revenues $242,237 $266,792 $289,759 $300,566 $303,250
========== ========== ========== ========== ==========
Average
subscribers 1,123 1,177 1,229 1,288 1,355
========== ========== ========== ========== ==========
ARPU $55 $56 $57 $57 $55
========== ========== ========== ========== ==========
ARPU with
roaming $72 $76 $79 $78 $75
========== ========== ========== ========== ==========
Cost of service
and operations $124,815 $133,418 $134,543 $154,602 $145,276
Less roaming
expenses (36,853) (41,602) (48,359) (50,638) (48,728)
General and
administrative
expenses 12,054 10,676 10,485 10,498 12,103
Upgrade costs
in selling and
marketing 8,003 6,433 11,544 11,043 10,225
---------- ---------- ---------- ---------- ----------
$108,019 $108,925 $108,213 $125,505 $118,876
========== ========== ========== ========== ==========
Average
subscribers 1,123 1,177 1,229 1,288 1,355
========== ========== ========== ========== ==========
CCPU $32 $31 $29 $32 $29
========== ========== ========== ========== ==========
CCPU with
roaming $43 $43 $42 $46 $41
========== ========== ========== ========== ==========
Selling and
marketing
expenses $42,909 $42,729 $54,018 $53,334 $54,570
Less upgrade
costs (8,003) (6,433) (11,544) (11,043) (10,225)
Cost of
products sold 26,985 23,049 28,916 29,995 35,107
Product sales
revenue (11,673) (11,667) (12,208) (12,415) (12,826)
---------- ---------- ---------- ---------- ----------
$50,218 $47,678 $59,182 $59,871 $66,626
========== ========== ========== ========== ==========
Activations 146 134 166 171 186
========== ========== ========== ========== ==========
CPGA $344 $356 $357 $350 $358
========== ========== ========== ========== ==========
Alamosa Holdings, Inc.
Pro Forma Computation of Adjusted EBITDA
Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005
Pro Forma Pro Forma Pro Forma Pro Forma Pro Forma
---------- ---------- ---------- ---------- ---------
(000's)
Net loss $(32,387) $(20,070) $(445) $(21,530) $(3,907)
Income tax
expense
(benefit) 818 450 - (1,038) (6,181)
Net interest
expense 25,482 22,916 24,152 24,960 24,022
Depreciation
and
amortization 52,476 50,738 51,241 55,175 55,168
Non-cash
compensation 26 25 30 802 771
Loss on debt
exchange 13,101 - - 2,991 -
(Gain) loss on
derivative
instrument (12,672) 11,926 (1,200) 2,251 (849)
(Gain) loss on
disposal of
equipment 303 2,602 227 941 (4)
---------- ---------- ---------- ---------- ---------
Adjusted EBITDA $47,147 $68,587 $74,005 $64,552 $69,020
========== ========== ========== ========== =========
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