US Unwired Reports First Quarter 2004 Financial Results; Company Records Quarterly EBITDA High of $28.0 Million; Net Subscribers Additions Top 37,700.Business Editors/High-Tech Writers LAKE CHARLES Lake Charles, city (1990 pop. 70,580), seat of Calcasieu parish, SW La.; inc. 1867. It is located on Lake Charles at the mouth of the Calcasieu River in a rice, timber, oil, and natural gas region. , La.--(BUSINESS WIRE)--May 3, 2004 US Unwired Unwired is an Australian public company dedicated to building a nationwide, fixed wireless telecommunications network offering carrier grade Internet services. They currently provide coverage in Sydney and Melbourne. (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :UNWR): Company Records Quarterly 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 High of $28.0 Million Net Subscribers Additions Top 37,700
HIGHLIGHTS:
3 months ended 3/31
---------------------
($000) 2004 2003
---------------------
Total Revenues $141,611 $124,730
Net Loss (9,662) (57,472)
EBITDA (A) 28,003 (8,229)
Capital Expenditures 5,226 9,829
(A) See attached table.
3 months ended 3/31
---------------------
2004 2003
---------------------
Ending Subscribers 651,347 584,190
Net Subscriber Additions 37,787 25,623
Churn 3.1% 3.7%
ARPU (B) $ 70.03 $68.81
(B) Includes roaming.
US Unwired Inc. (OTCBB:UNWR), 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 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 revenues of $141.6 million for the three-month period ended March 31, 2004. The company posted EBITDA (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.
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: operations of $28.0 million for first quarter of 2004. These results included $6.9 million of EBITDA generated from the company's wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , IWO Iwo (ē`wō), city (1991 est. pop. 320,000), SW Nigeria. It is the trade center for a farm region specializing in cacao. A coffee plantation is located nearby. Iwo was the capital of a Yoruba kingdom (founded in the 17th cent. Holdings, Inc. "These are extremely strong results," said Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. Piper, US Unwired's President and Chief Executive Officer, commenting on the first quarter of 2004's performance. "We accelerated the positive momentum generated last year from substantial changes in the policies, programs and procedures at every level of our company. As a result, we are more efficient and our 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. continue to improve." "Our churn rate (1) The percentage of customers who cancel their online, cellphone or other subscription service during a certain time period. (2) The percentage of employees who leave the company during a certain time period. See churning. fell to 3.1%, down 0.6% from a year ago and 0.3% from last quarter. The cost per gross addition fell by $28 from the first quarter of last year and by more than $100 from last quarter. Finally, our network performance has never been stronger. Even though we completed a record 1.7 billion minutes of use this quarter, our dropped and block call rates have never been lower. Collectively and individually, these results are exactly how we hoped to begin the year," Piper continued. During the first quarter, US Unwired sold certain non-core operating assets Operating Assets Another term for working capital. for net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of approximately $41.6 million. The properties sold included US Unwired's cellular operations, eight of its thirteen 10 MHz (MegaHertZ) One million cycles per second. It is used to measure the transmission speed of electronic devices, including channels, buses and the computer's internal clock. A one-megahertz clock (1 MHz) means some number of bits (16, 32, 64, etc. PCS licenses, 81 communication towers, and its 25% interest in a rural cellular property. From the net proceeds, the Company paid its senior secured lenders approximately $11.0 million and retained the remaining $30.6 million cash. On a consolidated basis, US Unwired had unrestricted cash of approximately $144.3 million and restricted cash of $8.2 million at March 31, 2004. All of the restricted cash and $36.2 million of the unrestricted cash were held by IWO Holdings, Inc. At March 31, 2004, IWO was in payment and covenant covenant (kŭv`ənənt), agreement entered into voluntarily by two or more parties to do or refrain from doing certain acts. In the Bible and in theology the covenant is the agreement or engagement of God with man as revealed in the defaults with its bank credit facility. US Unwired has not guaranteed or otherwise become responsible for IWO's debt. US Unwired will hold a conference call to discuss this press release at 11:00 a.m. Eastern Time on May 4, 2004. An online replay will be available approximately one hour following the conclusion of the live broadcast and will continue through May 18, 2004. Links to these events can be found at the Company's web site at http://www.usunwired.com. If Internet access See how to access the Internet. is unavailable, investors and other interested parties may listen to the teleconference by calling 888-694-4641. The teleconference will be available for replay until May 11, 2004, by calling 973-341-3080, and entering 4693049 when prompted for the pin number. About US Unwired US Unwired Inc., headquartered in Lake Charles, La., holds direct or indirect ownership interests in five PCS Affiliates of Sprint: Louisiana Louisiana (ləwē'zēăn`ə, l  ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. Unwired, Texas Unwired, Georgia Georgia, country, AsiaGeorgia (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. PCS, IWO Holdings and Gulf Coast Wireless. Through Louisiana Unwired, Texas Unwired, Georgia PCS and IWO Holdings, US Unwired is authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: to build, operate and manage wireless mobility communications network The transmission channels interconnecting all client and server stations as well as all supporting hardware and software. products and services under the Sprint brand name in 68 markets, currently serving over 650,000 PCS customers. US Unwired's PCS territory includes portions of Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). , 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. , Florida Florida, state, United States Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and , Georgia, Louisiana, Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by , 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). , Tennessee Tennessee, state, United States Tennessee (tĕn`əsē', tĕn'əsē`), state in the south-central United States. , Texas, Massachusetts Massachusetts (măsəch `sĭts), most populous of the New England states of the NE United States. , New Hampshire New Hampshire, one of the New England states of the NE United States. It is bordered by Massachusetts (S), Vermont, with the Connecticut R. forming the boundary (W), the Canadian province of Quebec (NW), and Maine and a short strip of the Atlantic Ocean (E). , New York New York, state, United StatesNew York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York , and Vermont Vermont (vərmŏnt`) [Fr.,=green mountain], New England state of the NE United States. It is bordered by New Hampshire, across the Connecticut R. . For more information on US Unwired and its products and services, visit the company's web site at http://www.usunwired.com. US Unwired is traded on the OTC Bulletin Board OTC Bulletin Board An electronic quotation listing of the bid and asked prices of OTC stocks that do not meet the requirements to be listed on the NASDAQ stock-listing system. under the symbol "UNWR". About Sprint Sprint is a global integrated communications provider serving more than 26 million customers in over 100 countries. With approximately 65,000 employees worldwide and over $26 billion in annual revenues in 2003, 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 and 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. . Sprint provides local communications services in 39 states and the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). and operates the largest 100-percent digital, nationwide PCS 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. . For more information, visit www.sprint.com. This press release may contain 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. . Forward-looking statements are statements about current and future business strategy, operations, capabilities, construction plan, construction schedule, financial projections, plans and objectives of management, expected actions of third parties and other matters. Forward-looking statements often include words like believes, belief, expects, plans, anticipates, intends, projects, estimates, may, might, would, or similar words. 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. 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 competitiveness of and the financial impact of Sprint wireless pricing plans, products and services; the ability of Sprint to provide back office, customer care and other services; consumer purchasing patterns; potential fluctuations in quarterly results; an adequate supply of 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. 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; the ability to successfully complete the build-out Build-out is an urban planner’s estimate of the amount and location of potential development for an area. Build-out is one step of the land use planning process. Evaluation of potential development impacts begins with a build-out analysis. of the IWO Holdings' network; the potential need for additional capital; 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 the companies; and volatility of US Unwired's 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 press release, please refer to Items 1, 7 and 7A of US Unwired's 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 period ended March 31, 2004 as filed with the Securities and Exchange Commission. US Unwired does not undertake to update or revise any forward-looking statement contained herein.
US UNWIRED INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(Unaudited)
For the three
months ended
March 31,
------------------
2004 2003
------------------
Revenue:
Subscriber $101,781 $91,348
Roaming 31,083 26,607
Merchandise sales 8,324 6,186
Other revenue 423 589
------------------
Total revenue 141,611 124,730
Expense:
Cost of service 68,762 77,281
Merchandise cost of sales 14,285 9,185
General and administrative 7,927 7,260
Sales and marketing 22,589 25,844
Non-cash stock compensation 45 986
Depreciation and amortization 29,400 29,658
IWO asset abandonment charge --- 12,403
------------------
Total operating expense 143,008 162,617
------------------
Operating loss (1,397) (37,887)
Other income (expense):
Interest expense (24,520) (20,690)
Gain on sale of assets (495) 2
------------------
Total other expense (25,015) (20,688)
Loss from continuing operations before equity in
income of unconsolidated affiliates (26,412) (58,575)
Equity in income of unconsolidated affiliates 116 180
------------------
Loss from continuing operations (26,296) (58,395)
Discontinued operations:
Gain on disposal of discontinued operations 16,183 ---
Income from discontinued operations 451 923
------------------
16,634 923
------------------
Net loss $(9,662)$(57,472)
==================
Basic and diluted loss per share
Continuing operations $(0.20) $(0.45)
Discontinued operations 0.13 ---
------------------
$(0.07) $(0.45)
==================
Weighted average outstanding common shares 128,845 128,832
==================
US UNWIRED INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
March December
31, 31,
2004 2003
--------- --------
Current assets:
Cash and cash equivalents $144,328 $97,193
Restricted cash 8,173 19,358
Subscriber receivables, net 34,270 28,687
Other receivables 3,093 2,625
Inventory 4,309 5,615
Prepaid expenses and other assets 17,676 14,833
Receivables from related parties 641 647
Receivables from officers 85 85
Current assets related to discontinued operations 156 1,049
------------------
Total current assets 212,731 170,092
Property and equipment, net 388,119 411,518
Goodwill 46,705 46,705
Intangibles, net 31,904 40,785
Notes receivable from unconsolidated affiliates 1,906 1,887
Other assets 33,421 42,571
Non-current assets related to discontinued
operations 150 4,770
------------------
Total assets $714,936 $718,328
==================
Current liabilities:
Accounts payable $42,902 $41,377
Accrued expenses 81,083 77,137
Current maturities of long term obligations 15,585 11,145
Current maturities of long term obligations in
default 352,120 351,697
Current liabilities related to discontinued
operations 373 49
------------------
Total current liabilities 492,063 481,405
Long term obligations, net of current maturities 428,314 434,745
Long term obligations in default, net of current
maturities --- ---
Deferred gain 31,212 30,729
Investments in and advances to unconsolidated
affiliates 2,547 1,216
Stockholders' deficit:
Common stock 1,288 1,288
Additional paid in capital 654,947 654,899
Retained deficit (895,425)(885,765)
Promissory note --- (179)
Treasury stock (10) (10)
------------------
Total stockholders' deficit (239,200)(229,767)
------------------
Total liabilities and stockholders' deficit $714,936 $718,328
==================
UNWIRED INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
For the three
months ended
March 31,
-----------------
2004 2003
-----------------
Cash flows from operating activities
-----------------------------------------------------
Net cash provided by operating activities $12,851 $9,959
Cash flows from investing activities
-----------------------------------------------------
Proceeds from restricted cash 11,186 11,035
Proceeds from sale of assets 41,565 350
Distribution from unconsolidated affiliates 500 ---
Payments for the purchase of equipment (5,226) (9,829)
-----------------
Net cash provided by investing activities 48,025 1,556
Cash flows from financing activities
-----------------------------------------------------
Principal payments of long-term debt (13,741) (172)
-----------------
Net cash used in financing activities (13,741) (172)
-----------------
Net increase in cash and cash equivalents 47,135 11,343
Cash and cash equivalents at beginning of period 97,193 61,985
-----------------
Cash and cash equivalents at end of period $144,328 $73,328
=================
EBITDA is an acronym acronym: see abbreviation. A word typically made up of the first letters of two or more words; for example, BASIC stands for "Beginners All purpose Symbolic Instruction Code. for Earnings before Interest, Taxes, Depreciation and Amortization, although other items in addition to these are sometimes excluded to calculate EBITDA. Although EBITDA is not a calculation 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 accounting principles generally accepted in the United States (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), we believe that EBITDA is widely used as a measure of operating performance in our industry. Nevertheless, the measure should not be considered in isolation or as a substitute for operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. , cash flows from operating activities or any other measure for determining operating performance or liquidity that is calculated in accordance with GAAP. In addition, since all companies do not calculate EBITDA in the same manner, this measure may not be comparable to similarly titled measures reported by other companies. We believe the nearest comparable GAAP measure to EBITDA is our Net Loss, and we have presented below a reconciliation of the two measures.
Three-month period ended March 31, 2004
----------------------------------------
Unwired
US Unwired Telecom Louisiana
Inc. (Parent) Corporation Unwired LLC
EBITDA $ (45) $ - $ 21,236
Depreciation and amortization (457) - (14,979)
Interest income (expense), net (12,010) 383 (1,579)
Gain on sale of assets 1 1,762 (2,233)
Equity in income (losses) of
unconsolidated subsidiaries (15,756) 116 (18,426)
Discontinued operations, net - 386 -
Gain on disposal of discontinued
operations - 16,183 -
------------- ----------- -----------
Net income (loss) $ (28,267) $ 18,830 $ (15,981)
============= =========== ===========
Three-month period ended March 31, 2004
----------------------------------------
IWO Holdings Consolidating
Inc. Entries Consolidated
EBITDA $ 6,877 $ (65) $ 28,003
Depreciation and amortization (13,964) - (29,400)
Interest income (expense), net (11,314) - (24,520)
Gain on sale of assets (25) - (495)
Equity in income (losses) of
unconsolidated subsidiaries - 34,182 116
Discontinued operations, net - 65 451
Gain on disposal of discontinued
operations - - 16,183
------------- ------------ ------------
Net income (loss) $ (18,426) $ 34,182 $ (9,662)
============= ============ ============
Three-month period ended March 31, 2003
----------------------------------------
Unwired
US Unwired Telecom Louisiana
Inc. (Parent) Corporation Unwired LLC
EBITDA $ (935) $ - $ 7,799
Depreciation and amortization (654) - (15,630)
Interest income (expense), net (10,149) 325 (1,995)
Gain on sale of assets - - 2
Equity in income (losses) of
unconsolidated subsidiaries (46,888) 154 (37,127)
Discontinued operations, net - 712 -
------------- ----------- -----------
Net income (loss) $ (58,626) $ 1,191 $ (46,951)
============= =========== ===========
Three-month period ended March 31, 2003
----------------------------------------
IWO Holdings Consolidating
Inc. Entries Consolidated
EBITDA $ (14,882) $ (211) $ (8,229)
Depreciation and amortization (13,374) - (29,658)
Interest income (expense), net (8,871) - (20,690)
Gain on sale of assets - - 2
Equity in income (losses) of
unconsolidated subsidiaries - 84,041 180
Discontinued operations, net - 211 923
------------- ------------ ------------
Net income (loss) $ (37,127) $ 84,041 $ (57,472)
============= ============ ============
SELECTED OPERATING METRICS
1Q 2004 1Q 2003
-------------------------
Subscribers
Gross Additions 101,702 93,118
Net Additions 37,787 25,623
Total Customers 651,347 584,190
Resale Customers 116,786 22,812
Churn 3.1% 3.7%
Average Revenue Per User, Monthly
Including Roaming $70.03 $68.81
Without Roaming 53.64 53.29
Cash Cost Per User, Monthly
Including Roaming 40.29 49.12
Without Roaming 29.22 37.68
Cost Per Gross Addition 281 309
Average Monthly MOUs Per Subscriber
Home 583 516
Roaming 213 158
System MOUs (Millions)
Subscriber 1,106 885
Roaming 570 352
Licensed POPs (Millions) 17.6 17.6
Covered POPs (Millions) 12.8 12.7
Towers 1,894 1,831
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