Successful Launch of Cellular Operations and Strategic SMR Positioning Highlight 1997 Results for Telesystem International Wireless Inc.MOTNREAL, Quebec--(BUSINESS WIRE)--March 11, 1998--(ME:TIW Tiw (tē`  ), Norse Tyr (tür), ancient Germanic god. .)
(TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :TIW.) Highlights For the quarter and the year ended December December: see month. 31, 1997 - At December 31, 1997, TIW had 387,100 subscribers in all three services compared to 157,100 at the end of 1996. - Cellular operations in Romania Romania (rōmān`ēə, –yə) or Rumania (r –), republic (v), 91,699 sq mi (237,500 sq km), SE Europe. attracted 117,300 subscribers(including 20,100 pre-paid) in less than eight months of operation in 1997, a remarkable success. Cellular services were launched successfully in Brazil late in the fourth quarter, attracting 15,600 subscribers. - Revenues for the fourth quarter and fiscal year ended December 31, 1997 totaled $36.0 million and $70.7 million, respectively, compared to $4.2 million and $12.6 million for the corresponding 1996 periods. - Net loss was $41.4 million in the fourth quarter and $82.1 million in fiscal 1997, compared to a net loss of $6.0 million and $21.9 million, respectively, in the corresponding periods of 1996. Such losses are consistent with the fact that TIW is a development stage company with several operations in their pre-operating or start-up Start-up The earliest stage of a new business venture. phase. - At December 31, 1997, the Company held cash and cash equivalents of $329.9 million, compared to $48.2 million as at December 31, 1996. - Subsequent to year-end, the Company concluded the acquisitions in the UK and Germany to become the largest SMR (Specialized Mobile Radio) The communications services used by police, ambulances, taxicabs, trucks and other delivery vehicles. Throughout the U.S., approximately 3,000 independent operators are licensed by the FCC to offer this service, which provides always-on operator in Europe bringing the total subscribers base to approximately 160,000. Furthermore, a letter of intent has been signed to acquire an additional SMR operation in France. Having consolidated its market position, the Company announced plans to build the world's first public national digital mobile communications network The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. based on the TETRA tetra: see characin. tetra Any of numerous attractively coloured freshwater South American and African fishes (family Characidae), often kept in home aquariums. Tetras are small, lively, hardy, and unaggressive. standard, starting in the U.K. with a $325 million investment program. Successful Launch of Cellular Operations and Strategic Smr Positioning Highlight 1997 Results for Telesystem International Wireless Inc. Telesystem International Wireless Inc. (TSE, ME, "TIW") reports significant progress in the implementation of its development plan in 1997 with the successful launch of cellular services in four countries. In Specialized Mobile Radio See SMR. (SMR) services, the Company became a market leader in Europe, strategically positioned to introduce digital SMR based on the TETRA standard. Revenues for the fourth quarter and fiscal year ended December 31, 1997 totaled $36.0 million and $70.7 million, respectively, compared to $4.2 million and $12.6 million for the corresponding 1996 periods. The higher revenues reflect the acceleration of subscriber growth in the Company's cellular, SMR and paging services. At December 31, 1997, TIW had 387,100 subscribers in all three services compared to 157,100 at the end of 1996. "We are very pleased with our achievements in 1997 because we met or surpassed all of our objectives," said Bruno Ducharme, President and Chief Executive Officer of TIW. "We launched cellular services in four countries, including Romania where our subsidiary attracted 117,300 subscribers in less than eight months, a remarkable success. Our SMR strategy unfolded according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. plan as we continued to lay the groundwork for the launch of digital services. In paging services, we achieved strong subscriber growth." "As a result, the Company is well-placed to continue its rapid growth in 1998", said Mr. Ducharme. "We expect another very active year, in both our existing operations and new opportunities in an industry that holds tremendous potential for growth." TIW posted a net loss of $41.4 million in the fourth quarter and $82.1 million in fiscal 1997, compared to net losses of $6.0 million and $21.9 million, respectively, in the corresponding periods of 1996. Such losses are consistent with the fact that TIW is a development stage company with several operations in their pre-operating or start-up phase. The fourth quarter loss also reflects pre-operating expenses incurred in the preparation for the deployment of digital SMR services in Europe, the larger scale of cellular operations including the service launch in Brazil as well as the full consolidation of our Netherlands paging operations subsequent to the control position taken in the quarter. Review of Operations Cellular services Fourth quarter 1997 revenues of $24.4 million and $43.7 million for the year were attributable mainly to MobiFon in Romania. The number of subscribers rose to 117,300 at December 31 compared to 50,778 at the end of the third quarter. About 20,100 of the additional subscribers were attracted through a pre-paid mobile digital telephony Digital telephony is a technology used in the provision of digital telephone services and systems. Since the 1960s it has almost entirely replaced the old telephone system that used analog telephony. product launched during the quarter. In Brazil, commercial digital cellular services were introduced in Brasilia, the federal capital, in November. The launch attracted 15,600 subscribers by year-end. TIW holds a 19 percent equity interest in the Americel consortium which holds the license for the Centre-West region of the country. In the state of Rajasthan, India, subscribers totaled 6,100 at December 31, 1997, while in the province of Hunan, China, the number of subscribers at year-end was 4,300 in the city of Changsha. Cellular services recorded an 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. before depreciation, amortization and corporate and business development expenses of $16.1 million for the fourth quarter and $44.9 million for the year. These losses resulted mainly from pre-operating expenses, fixed network operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. as well as launch costs and general expenses. The fourth quarter loss reflects a higher scale of operations, including the service launch in Brazil. SMR services Revenues were $6.8 million for the fourth quarter and $11.9 million for the year, representing strong growth over 1996. The higher revenues reflect modest internal subscriber growth in analog SMR services in France and the United Kingdom, as well as the contribution from acquisitions in France and Germany. At December 31, subscribers totaled 52,800. Operating loss before depreciation, amortization and corporate and business development expenses was $2.6 million for the fourth quarter of 1997 and $3.5 million for the year, compared to an operating loss of $1.2 million and $5.8 million for the corresponding periods of 1996, respectively. The fourth quarter loss includes pre-operating expenses incurred in the preparation for the deployment of digital SMR services. Subsequent to year-end, the Company concluded the acquisitions in the UK and Germany to become the largest SMR operator in Europe bringing the total subscribers base to approximately 160,000. Furthermore, a letter of intent has also been signed to acquire an additional SMR operation in France. Having consolidated its market position, the Company announced plans to build the world's first public national digital mobile communications network based on the TETRA standard, starting in the U.K. with a $325 million investment program. Paging services Revenues for the fourth quarter and year were $4.9 million and $15.1 million, respectively, up significantly compared to the corresponding 1996 periods. TIW acquired a controlling interest controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in CallMax in the Netherlands in December and appointed a new management team with a turn around mandate. Non-revenue generating subscribers were deleted Deleted A security that is no longer included on a specified market. Sometimes referred to as "delisted". Notes: Reasons for delisting include violating regulations, failing to meet financial specifications set out by the stock exchange and going bankrupt. from the customer list at year-end, bringing down the total subscribers to 113,000. ERSA ERSA Engineering of Reconfigurable Systems and Algorithms (conference) ERSA Employer Retirement Savings Account ERSA En Route Supplement Australia (aviation) ERSA Ernst Sachs ERSA Extended Runway Safety Area in Mexico ended the year with 98,100 subscribers for a combined total of 211,100 compared to 132,500 in 1996. Operating loss before depreciation, amortization and corporate and development expenses was $6.7 million for the fourth quarter and $7.4 million for the year. The fourth quarter 1997 results reflect the Company's higher ownership interest and corresponding increase share of CallMax losses together with the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of approximately $6 million for deferred promotional expenses Noun 1. promotional expense - the cost of promoting a product business expense, trade expense - ordinary and necessary expenses incurred in a taxpayer's business or trade . Liquidity and Capital Resources TIW is well capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. , with sufficient financial resources to pursue its current operations' 1998 deployment. As the operating companies operating company A business that engages in transactions with outsiders. expand their networks and increase the number of subscribers, TIW intends to maximize the financing leverage at the operations level. The previously announced US$190 million loan facility for MobiFon in Romania, arranged and financed by the European Bank for Reconstruction and Development European Bank for Reconstruction and Development Bank targeted at Eastern Europe and the former Soviet Union. (EBRD EBRD See: European Bank for Reconstruction and Development ) and other financial institutions, is an example of this strategy. TIW ended 1997 with cash and cash equivalents of $329.9 million, compared to $48.2 million as at December 31, 1996. Total 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. was $483.9 million which includes $315.2 million in accreted value accreted value The current value of an original-issue discount bond, taking into account imputed interest that has accumulated. of Senior Discount Notes at the corporate level. As previously announced, during the fourth quarter the Company raised gross proceeds of approximately US$100 million through a private offering of 10 1/2 percent Senior Discount Notes, zero coupon until 2003, at which time the accreted value will be US$167 million. The notes will mature November 1, 2007 and the first interest payment is due May 1, 2003. TIW develops, owns and operates a geographically and technologically diversified diversified (di·verˑ·s portfolio of wireless telecommunications networks A telecommunications network is a of telecommunications links and nodes arranged so that messages may be passed from one part of the network to another over multiple links and through various nodes. in several countries in Europe, Asia and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . The Company currently provides digital cellular services in Romania In 2003 services constituted 55% of gross domestic product (GDP), and the sector employed 51.3% of the workforce. The subcomponents of services are financial, renting, and business activities (20.5%); trade, hotels and restaurants, and transport (18%); and other service activities (21.7%). , Brazil, India and China, specialized mobile radio (SMR) services in France, the United Kingdom, Germany and Spain, as well as paging operations in Mexico and the Netherlands. -0-
Selected Consolidated Financial and Operating Data
Three months Twelve months
Ended December 31 Ended December 31
1997 1996 1997 1996
(unaudited)(unaudited)(unaudited)(unaudited)
_______________________________________________________________
Statement of Loss
and Cash Flow Data
(in thousands of US dollars except per share data)
Revenues 36,001 4,211 70,717 12,558
Operating loss before
depreciation and
amortization 29,060 5,319 68,247 20,232
Net loss 41,369 5,956 82,103 21,889
Net loss per share 0.64 0.18 1.41 0.73
Acquisitions of
capital assets 79,133 80,838 256,380 110,163
As of December 31, As of December 31,
1997 1996
____________________________________________________________
Balance Sheet Data
(unaudited)
(in thousands of US dollars)
Cash and cash equivalents 329,854 48,237
Total assets 845,461 235,776
Short term and long
term debt 483,924 5,654
Shareholders' equity 225,553 197,040
As of December 31, 1997
______________________________________________________________
Licensed POPs Equity POPs (1) Total POPs
(in millions)
Cellular 63.6 148.1
Paging 55.2 109.2
SMR 101.5 157.2
______________________________________________________________
TOTAL 220.3 414.5
As of December 31, 1997
______________________________________________________________
Subscribers Equity Subscribers (1) Total Subscribers
Cellular 66,804 123,200
Paging 115,869 211,100
SMR 24,319 52,800
______________________________________________________________
TOTAL 206,992 387,100
(1) Adjusted for TIW's percentage of ownership in each of its
licensed operations
CONTACT: Telesystem International Wireless Inc. Marie-Claude Fortin, 514/925-8461 mfortin@tiw.ca or Pierre Fitzgibbon, 514/925-8466 pfitgibbon@tiw.ca |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion