Delaware | 000-51027 | 16-1694797 | ||
(State or other jurisdiction | (Commission | (I.R.S. Employer | ||
of incorporation) | File Number) | Identification No.) | ||
6677 Richmond Highway, Alexandria, | 22306 | |||
Virginia | ||||
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (703) 660-6677 |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4{c)) |
USA Mobility, Inc.
May 25, 2006
By:
/s/ Thomas L. Schilling
Name:
Thomas L. Schilling
Title:
Chief Financial Officer
For Immediate Release
|
Contact: Bob Lougee (703) 721-3080 | |
Wednesday, May 24, 2006
|
| In the fourth quarter of 2005, the company recognized a reduction of service, repair and maintenance (SRM) expense of $1.2 million. Of that total, $0.9 million represents a gain due to the difference between the companys estimated deconstruction obligations under the companys Asset Retirement Obligation (ARO) and the actual expenses incurred during that period. The remaining $0.3 million corresponds to the reclassification of accretion expense from SRM expense into depreciation, amortization and accretion. In the past, the company had included accretion expense as a component of SRM expense. | ||
| The companys fourth quarter results also reflect a net reduction of depreciation, amortization and accretion of $12.2 million, as compared to the preliminary 2005 operating results announced on April 3. A total of $12.5 million of the reduction represents an adjustment to the depreciable life of the paging infrastructure assets, while accretion increased by $0.3 million, reflecting the reclassification of accretion from SRM expense as discussed above. | ||
| For the year-ended 2005, the company recognized a reduction of SRM expense of $2.6 million. Of that total, $1.5 million represents a gain due to the difference between the companys estimated deconstruction obligations under the ARO and the actual expenses incurred during that period. The remaining $1.0 million corresponds to the reclassification of accretion expense from SRM expense into depreciation, amortization and accretion. | ||
| The companys 2005 year-end results also reflect a reduction of depreciation, amortization and accretion of $22.1 million, as compared to preliminary 2005 operating results. A total of $23.1 million of the reduction represents an adjustment to the depreciable life of the paging infrastructure assets, with accretion increasing by $1.0 million, reflecting the reclassification of accretion from SRM expense as discussed above. |
| The income statement reflects an increase to depreciation, amortization and accretion expense of $14.8 million, and a decrease to all other operating expenses of $5.8 million resulting in a decrease in operating income of $9.0 million, and a decrease to net income of $2.5 million. | ||
| The assets on the balance sheet as of September 30, 2005 reflect a decrease to property, plant and equipment of $10.4 million, and decrease to the deferred tax asset of $4.4 million, a decrease to accounts receivable of $0.7 million, and an increase to goodwill of $2.8 million, for an overall reduction to assets of $12.7 million. |
| Liabilities and equity on the balance sheet as of September 30, 2005 reflect an increase of $8.1 million in liabilities, primarily a result of the asset retirement obligation, and a reduction to equity of $20.8 million. |
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
December 31, 2004
December 31, 2005
(Restated)
$
46,995
$
37,547
40,078
38,177
117
1,687
15,343
8,973
25,525
18,895
$
128,058
$
105,279
220,028
127,802
154,369
149,478
67,129
40,654
207,046
207,150
5,517
3,430
$
782,147
$
633,793
$
47,558
$
13
86,478
65,719
4,316
3,104
23,623
17,924
$
161,975
$
86,760
47,500
16,632
14,040
$
226,107
$
100,800
3
3
536,252
521,298
19,785
11,692
556,040
532,993
$
782,147
$
633,793
Year Ended December 31, | ||||||||
2004 | 2005 | |||||||
(Restated) | ||||||||
Revenue:
|
||||||||
Service, rental and maintenance, net of service credits
|
$ | 470,751 | $ | 592,690 | ||||
Product sales
|
19,409 | 25,882 | ||||||
|
||||||||
Total revenue
|
490,160 | 618,572 | ||||||
|
||||||||
|
||||||||
Operating expenses:
|
||||||||
Cost of products sold
|
4,347 | 4,483 | ||||||
Service, rental and maintenance
|
160,144 | 215,588 | ||||||
Selling and marketing
|
36,085 | 43,145 | ||||||
General and administrative
|
130,046 | 177,438 | ||||||
Depreciation, amortization and accretion
|
107,629 | 131,328 | ||||||
Stock based compensation
|
4,863 | 2,832 | ||||||
Severance and related termination costs
|
11,938 | 16,609 | ||||||
|
||||||||
Total operating expenses
|
455,052 | 591,423 | ||||||
|
||||||||
Operating income
|
35,108 | 27,149 | ||||||
|
||||||||
|
||||||||
Interest expense
|
(6,365 | ) | (2,412 | ) | ||||
Interest income
|
451 | 1,089 | ||||||
Loss on extinguishment of long-term debt
|
(1,031 | ) | (1,338 | ) | ||||
Other income, net
|
814 | (1,004 | ) | |||||
|
||||||||
Income before income tax expense
|
28,977 | 23,484 | ||||||
Income tax expense
|
(16,810 | ) | (10,577 | ) | ||||
|
||||||||
Net income
|
$ | 12,167 | $ | 12,907 | ||||
|
||||||||
|
||||||||
Basic net income per common share
|
$ | 0.58 | $ | 0.47 | ||||
|
||||||||
Diluted net income per common share
|
$ | 0.58 | $ | 0.47 | ||||
|
||||||||
|
||||||||
Basic weighted average common shares outstanding
|
20,839,959 | 27,275,040 | ||||||
|
||||||||
Diluted weighted average common shares outstanding
|
20,966,405 | 27,427,120 | ||||||
|
||||||||
|
||||||||
Reconciliation of operating income to EBITDA:
|
||||||||
Operating income
|
$ | 35,108 | $ | 27,149 | ||||
Addback:
|
||||||||
Depreciation, amortization and accretion
|
107,629 | 131,328 | ||||||
|
||||||||
EBITDA (a)
|
$ | 142,737 | $ | 158,477 | ||||
|
(a) | EBITDA or Earnings before interest, taxes, depreciation and amortization is a non-GAAP measure and is presented for analytical purposes only. |
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
2004
2005
(Restated)
$
12,167
$
12,907
107,629
131,328
17,766
7,461
1,036
1,338
372
714
4,863
2,832
13,565
25,055
(93
)
1,287
(2,158
)
(23,439
)
4,745
5,109
(4,962
)
7,978
(28,451
)
(21,276
)
(8,790
)
(6,911
)
(3,424
)
(5,129
)
$
114,265
$
139,254
(19,232
)
(13,499
)
2,998
168
271
285
(117,759
)
$
(133,722
)
$
(13,046
)
140,000
(105,017
)
(95,045
)
(40,691
)
(3,113
)
80
$
31,870
$
(135,656
)
$
12,413
$
(9,448
)
34,582
46,995
$
46,995
$
37,547
$
6,966
$
2,245
$
1,729
$
562
Three Months Ended | ||||||||||||||||||||||||||||||||
March 2004 | June 2004 | September 2004 | December 2004 | March 2005 | June 2005 | September 2005 | December 2005 | |||||||||||||||||||||||||
Direct One-Way:
|
||||||||||||||||||||||||||||||||
Beginning units in
service
|
5,329 | 5,100 | 4,909 | 4,690 | 4,464 | 4,273 | 4,114 | 3,977 | ||||||||||||||||||||||||
Gross placements
|
226 | 181 | 182 | 166 | 141 | 134 | 125 | 126 | ||||||||||||||||||||||||
Disconnects
|
(455 | ) | (372 | ) | (401 | ) | (392 | ) | (332 | ) | (293 | ) | (262 | ) | (268 | ) | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ending units in service
|
5,100 | 4,909 | 4,690 | 4,464 | 4,273 | 4,114 | 3,977 | 3,835 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Two-Way:
|
||||||||||||||||||||||||||||||||
Beginning units in
service
|
506 | 483 | 462 | 449 | 422 | 397 | 382 | 365 | ||||||||||||||||||||||||
Gross placements
|
40 | 32 | 35 | 29 | 22 | 29 | 17 | 18 | ||||||||||||||||||||||||
Disconnects
|
(63 | ) | (53 | ) | (48 | ) | (56 | ) | (47 | ) | (44 | ) | (34 | ) | (36 | ) | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ending units in service
|
483 | 462 | 449 | 422 | 397 | 382 | 365 | 347 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Indirect One-Way:
|
||||||||||||||||||||||||||||||||
Beginning units in
service
|
1,716 | 1,474 | 1,253 | 1,101 | 987 | 859 | 762 | 685 | ||||||||||||||||||||||||
Gross placements
|
157 | 145 | 160 | 143 | 107 | 92 | 26 | 26 | ||||||||||||||||||||||||
Disconnects
|
(399 | ) | (366 | ) | (312 | ) | (257 | ) | (235 | ) | (189 | ) | (103 | ) | (107 | ) | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ending units in service
|
1,474 | 1,253 | 1,101 | 987 | 859 | 762 | 685 | 604 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Two-Way:
|
||||||||||||||||||||||||||||||||
Beginning units in
service
|
131 | 123 | 121 | 115 | 94 | 91 | 90 | 89 | ||||||||||||||||||||||||
Gross placements
|
20 | 16 | 20 | 7 | 7 | 7 | 3 | 18 | ||||||||||||||||||||||||
Disconnects
|
(28 | ) | (18 | ) | (26 | ) | (28 | ) | (10 | ) | (8 | ) | (4 | ) | (7 | ) | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ending units in service
|
123 | 121 | 115 | 94 | 91 | 90 | 89 | 100 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Total
|
||||||||||||||||||||||||||||||||
Beginning units in
service
|
7,682 | 7,180 | 6,745 | 6,355 | 5,967 | 5,620 | 5,348 | 5,116 | ||||||||||||||||||||||||
Gross placements
|
443 | 374 | 397 | 345 | 277 | 262 | 171 | 188 | ||||||||||||||||||||||||
Disconnects
|
(945 | ) | (809 | ) | (787 | ) | (733 | ) | (624 | ) | (534 | ) | (403 | ) | (418 | ) | ||||||||||||||||
|
||||||||||||||||||||||||||||||||
Ending units in service
|
7,180 | 6,745 | 6,355 | 5,967 | 5,620 | 5,348 | 5,116 | 4,886 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Adjusted Proforma ARPU
|
||||||||||||||||||||||||||||||||
Direct One-Way
|
$ | 9.10 | $ | 8.96 | $ | 8.89 | $ | 8.75 | $ | 8.65 | $ | 8.61 | $ | 8.48 | $ | 8.27 | ||||||||||||||||
Direct Two-Way
|
$ | 25.15 | $ | 24.68 | $ | 24.22 | $ | 23.93 | $ | 23.98 | $ | 23.65 | $ | 24.28 | $ | 23.76 | ||||||||||||||||
Indirect One-Way
|
$ | 4.06 | $ | 4.26 | $ | 4.12 | $ | 4.26 | $ | 4.07 | $ | 4.11 | $ | 4.36 | $ | 4.66 | ||||||||||||||||
Indirect Two-Way
|
$ | 12.89 | $ | 12.07 | $ | 11.30 | $ | 10.41 | $ | 9.16 | $ | 8.71 | $ | 8.42 | $ | 7.80 | ||||||||||||||||
Total
|
$ | 9.15 | $ | 9.16 | $ | 9.14 | $ | 9.09 | $ | 9.01 | $ | 9.02 | $ | 9.04 | $ | 8.90 | ||||||||||||||||
(a) | Assumes Arch and Metrocall combined as of January 1, 2004 and the unit in service adjustment reflected in March 2004. | |
(b) | Amounts have been adjusted for rounding. |
For the year ended December 31, | ||||||||
2004 | ||||||||
Proforma | 2005 | |||||||
Revenues:
|
||||||||
Service, rental and maintenance, net of service credits
|
$ | 754,696 | $ | 592,690 | ||||
Product sales
|
34,009 | 25,882 | ||||||
|
||||||||
Total revenue
|
788,705 | 618,572 | ||||||
|
||||||||
Operating expenses:
|
||||||||
Cost of products sold
|
8,475 | 4,483 | ||||||
Service, rental and maintenance
|
256,382 | 215,588 | ||||||
Selling and marketing
|
65,847 | 43,145 | ||||||
General and administrative
|
216,317 | 177,438 | ||||||
Depreciation, amortization and accretion
|
145,328 | 131,328 | ||||||
Stock based compensation
|
6,401 | 2,832 | ||||||
Severance and restructuring
|
13,622 | 16,609 | ||||||
|
||||||||
Total operating expenses
|
712,372 | 591,423 | ||||||
|
||||||||
|
||||||||
Operating income
|
76,333 | 27,149 | ||||||
|
||||||||
|
||||||||
Interest expense
|
(7,360 | ) | (2,412 | ) | ||||
Interest income
|
451 | 1,089 | ||||||
Loss on extinguishment of long-term debt
|
| (1,338 | ) | |||||
Other income, net
|
163 | (1,004 | ) | |||||
|
||||||||
Income before income tax expense
|
69,587 | 23,484 | ||||||
Income tax expense
|
(33,006 | ) | (10,577 | ) | ||||
|
||||||||
Net income
|
$ | 36,581 | $ | 12,907 | ||||
|
||||||||
|
||||||||
Basic net income per common share
|
$ | 1.36 | $ | 0.47 | ||||
|
||||||||
Diluted net income per common share
|
$ | 1.34 | $ | 0.47 | ||||
|
||||||||
|
||||||||
Basic weighted average common shares outstanding
|
26,938,871 | 27,275,040 | ||||||
|
||||||||
Diluted weighted average common shares outstanding
|
27,313,706 | 27,427,120 | ||||||
|
||||||||
|
||||||||
Reconciliation of operating income to EBITDA:
|
||||||||
Operating income
|
$ | 76,333 | $ | 27,149 | ||||
Addback:
|
||||||||
Depreciation, amortization and accretion
|
145,328 | 131,328 | ||||||
|
||||||||
EBITDA (b)
|
$ | 221,661 | $ | 158,477 | ||||
|
(a) | Pro forma amounts assume the merger of Arch Wireless, Inc. and Metrocall Holdings, Inc. as of January 1, 2004. | |
(b) | EBITDA or Earnings before interest, taxes, depreciation and amortization is a non-GAAP measure and is presented for analytical purposes only. |
For the three months ended | ||||||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | December 31, | |||||||||||||||||||||||||
2004 | 2004 | 2004 | 2004 | 2005 | 2005 | 2005 | 2005 | |||||||||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||||||||||
Service, rental and maintenance, net of service credits
|
$ | 119,546 | $ | 111,174 | $ | 104,785 | $ | 135,246 | $ | 159,150 | $ | 151,483 | $ | 145,014 | $ | 137,043 | ||||||||||||||||
Product sales
|
4,113 | 4,623 | 4,632 | 6,041 | 6,527 | 6,054 | 6,940 | 6,361 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Total revenue
|
123,659 | 115,797 | 109,417 | 141,287 | 165,677 | 157,537 | 151,954 | 143,404 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||||||||||
Cost of products sold
|
938 | 856 | 691 | 1,862 | 1,279 | 929 | 945 | 1,330 | ||||||||||||||||||||||||
Service, rental and maintenance
|
38,790 | 36,739 | 36,653 | 47,962 | 56,353 | 56,104 | 53,739 | 49,392 | ||||||||||||||||||||||||
Selling and marketing
|
9,068 | 8,757 | 7,862 | 10,398 | 10,402 | 11,156 | 11,276 | 10,311 | ||||||||||||||||||||||||
General and administrative
|
31,304 | 29,150 | 27,615 | 41,977 | 48,427 | 46,491 | 43,261 | 39,259 | ||||||||||||||||||||||||
Depreciation, amortization and accretion
|
26,353 | 28,327 | 21,867 | 31,082 | 40,595 | 35,224 | 28,876 | 26,633 | ||||||||||||||||||||||||
Stock based compensation
|
2,267 | 1,908 | 1,865 | (1,177 | ) | 1,385 | 597 | 271 | 579 | |||||||||||||||||||||||
Severance and restructuring
|
3,689 | 602 | 1,228 | 6,419 | 5,137 | 9,904 | 855 | 713 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Total operating expenses
|
112,409 | 106,339 | 97,781 | 138,523 | 163,578 | 160,405 | 139,223 | 128,217 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Operating income (loss)
|
11,250 | 9,458 | 11,636 | 2,764 | 2,099 | (2,868 | ) | 12,731 | 15,187 | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Interest expense
|
(3,400 | ) | (1,770 | ) | (18 | ) | (1,177 | ) | (1,411 | ) | (734 | ) | (232 | ) | (35 | ) | ||||||||||||||||
Interest income
|
71 | 70 | 89 | 221 | 197 | 235 | 214 | 443 | ||||||||||||||||||||||||
Loss on extinguishment of long-term debt
|
| | | (1,031 | ) | (594 | ) | (432 | ) | (312 | ) | | ||||||||||||||||||||
Other income, net
|
168 | 177 | 66 | 403 | 137 | (73 | ) | 76 | (1,144 | ) | ||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Income (loss) before income tax expense
|
8,089 | 7,935 | 11,773 | 1,180 | 428 | (3,872 | ) | 12,477 | 14,451 | |||||||||||||||||||||||
Income tax expense
|
(3,256 | ) | (1,690 | ) | (9,369 | ) | (2,495 | ) | (291 | ) | 61 | (3,750 | ) | (6,597 | ) | |||||||||||||||||
|
||||||||||||||||||||||||||||||||
Net income (loss)
|
$ | 4,833 | $ | 6,245 | $ | 2,404 | $ | (1,315 | ) | $ | 137 | $ | (3,811 | ) | $ | 8,727 | $ | 7,854 | ||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Basic net income (loss) per common share
|
$ | 0.24 | $ | 0.31 | $ | 0.12 | $ | (0.06 | ) | $ | 0.01 | $ | (0.14 | ) | $ | 0.32 | $ | 0.29 | ||||||||||||||
|
||||||||||||||||||||||||||||||||
Diluted net income (loss) per common share
|
$ | 0.24 | $ | 0.31 | $ | 0.12 | $ | (0.06 | ) | $ | 0.01 | $ | (0.14 | ) | $ | 0.32 | $ | 0.29 | ||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Basic weighted average common shares outstanding
|
20,000,000 | 19,965,076 | 19,914,099 | 23,461,642 | 27,108,034 | 27,226,076 | 27,365,701 | 27,396,187 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Diluted weighted average common shares outstanding
|
20,078,213 | 20,109,191 | 20,041,555 | 23,461,642 | 27,320,212 | 27,226,076 | 27,465,990 | 27,459,261 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Reconciliation of operating income to EBITDA:
|
||||||||||||||||||||||||||||||||
Operating income (loss)
|
$ | 11,250 | $ | 9,458 | $ | 11,636 | $ | 2,764 | $ | 2,099 | $ | (2,868 | ) | $ | 12,731 | $ | 15,187 | |||||||||||||||
Addback:
|
||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion
|
26,353 | 28,327 | 21,867 | 31,082 | 40,595 | 35,224 | 28,876 | 26,633 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
EBITDA (a)
|
$ | 37,603 | $ | 37,785 | $ | 33,503 | $ | 33,846 | $ | 42,694 | $ | 32,356 | $ | 41,607 | $ | 41,820 | ||||||||||||||||
|
(a) | EBITDA or Earnings before interest, taxes, depreciation and amortization is a non-GAAP measure and is presented for analytical purposes only. |
For the three months ended | ||||||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | |||||||||||||||||||||||||||||
2004 | 2004 | 2004 | 2004 | March 31, | June 30, | September 30, | December 31, | |||||||||||||||||||||||||
Pro forma | Pro forma | Pro forma | Pro forma | 2005 | 2005 | 2005 | 2005 | |||||||||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||||||||||
Service, rental and maintenance, net of service credits
|
$ | 206,356 | $ | 193,917 | $ | 182,452 | $ | 171,971 | $ | 159,150 | $ | 151,483 | $ | 145,014 | $ | 137,043 | ||||||||||||||||
Product sales
|
8,016 | 8,997 | 9,027 | 7,969 | 6,527 | 6,054 | 6,940 | 6,361 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Total revenue
|
214,372 | 202,914 | 191,479 | 179,940 | 165,677 | 157,537 | 151,954 | 143,404 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||||||||||
Cost of products sold
|
1,878 | 2,199 | 2,124 | 2,274 | 1,279 | 929 | 945 | 1,330 | ||||||||||||||||||||||||
Service, rental and maintenance
|
67,121 | 64,167 | 62,365 | 62,729 | 56,353 | 56,104 | 53,739 | 49,392 | ||||||||||||||||||||||||
Selling and marketing
|
18,299 | 17,475 | 15,667 | 14,406 | 10,402 | 11,156 | 11,276 | 10,311 | ||||||||||||||||||||||||
General and administrative
|
53,707 | 51,181 | 50,289 | 61,140 | 48,427 | 46,491 | 43,261 | 39,259 | ||||||||||||||||||||||||
Depreciation, amortization and accretion
|
38,238 | 39,550 | 32,496 | 35,045 | 40,595 | 35,224 | 28,876 | 26,633 | ||||||||||||||||||||||||
Stock based compensation
|
5,966 | 2,810 | 2,093 | (2,784 | ) | 1,385 | 597 | 271 | 579 | |||||||||||||||||||||||
Severance and restructuring
|
3,689 | 602 | 1,228 | 6,419 | 5,137 | 9,904 | 855 | 713 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Total operating expenses
|
188,898 | 177,984 | 166,262 | 179,229 | 163,578 | 160,405 | 139,223 | 128,217 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Operating income (loss)
|
25,474 | 24,930 | 25,217 | 711 | 2,099 | (2,868 | ) | 12,731 | 15,187 | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Interest expense
|
(2,188 | ) | (1,971 | ) | (1,753 | ) | (1,448 | ) | (1,411 | ) | (734 | ) | (232 | ) | (35 | ) | ||||||||||||||||
Interest income
|
| | | 451 | 197 | 235 | 214 | 443 | ||||||||||||||||||||||||
Loss on extinguishment of long-term debt
|
| | | | (594 | ) | (432 | ) | (312 | ) | | |||||||||||||||||||||
Other income, net
|
110 | 201 | 17 | (165 | ) | 137 | (73 | ) | 76 | (1,144 | ) | |||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Income (loss) before income tax expense
|
23,396 | 23,160 | 23,481 | (451 | ) | 428 | (3,872 | ) | 12,477 | 14,451 | ||||||||||||||||||||||
Income tax expense
|
(9,410 | ) | (7,810 | ) | (14,077 | ) | (1,709 | ) | (291 | ) | 61 | (3,750 | ) | (6,597 | ) | |||||||||||||||||
|
||||||||||||||||||||||||||||||||
Net income (loss)
|
$ | 13,986 | $ | 15,350 | $ | 9,404 | $ | (2,160 | ) | $ | 137 | $ | (3,811 | ) | $ | 8,727 | $ | 7,854 | ||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Basic net income (loss) per common share
|
$ | 0.52 | $ | 0.57 | $ | 0.35 | $ | (0.08 | ) | $ | 0.01 | $ | (0.14 | ) | $ | 0.32 | $ | 0.29 | ||||||||||||||
|
||||||||||||||||||||||||||||||||
Diluted net income (loss) per common share
|
$ | 0.51 | $ | 0.56 | $ | 0.34 | $ | (0.08 | ) | $ | 0.01 | $ | (0.14 | ) | $ | 0.32 | $ | 0.29 | ||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Basic weighted average common shares outstanding
|
26,961,046 | 26,926,122 | 26,875,145 | 26,992,900 | 27,108,034 | 27,226,076 | 27,365,701 | 27,396,187 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Diluted weighted average common shares outstanding
|
27,324,881 | 27,355,859 | 27,288,223 | 26,992,900 | 27,320,212 | 27,226,076 | 27,465,990 | 27,459,261 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Reconciliation of operating income to EBITDA:
|
||||||||||||||||||||||||||||||||
Operating income (loss)
|
$ | 25,474 | $ | 24,930 | $ | 25,217 | $ | 711 | $ | 2,099 | $ | (2,868 | ) | $ | 12,731 | $ | 15,187 | |||||||||||||||
Addback:
|
||||||||||||||||||||||||||||||||
Depreciation, amortization and accretion
|
38,238 | 39,550 | 32,496 | 35,045 | 40,595 | 35,224 | 28,876 | 26,633 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||
EBITDA (b)
|
$ | 63,712 | $ | 64,480 | $ | 57,713 | $ | 35,756 | $ | 42,694 | $ | 32,356 | $ | 41,607 | $ | 41,820 | ||||||||||||||||
|
(a) | Pro forma amounts assume the merger of Arch Wireless, Inc. and Metrocall Holdings, Inc. as of January 1, 2004. | |
(b) | EBITDA or Earnings before interest, taxes, depreciation and amortization is a non-GAAP measure and is presented for analytical purposes only. |
Cumulative Summary of Adjustments to Assets and Liabilities
(In thousands)
December 31,
Quarter ended
2002
2003
2004
3/31/05
6/30/05
9/30/05
$
$
$
(740
)
$
(740
)
$
(740
)
$
(740
)
(2
)
4,710
(5,367
)
3,520
2,172
551
(10,358
)
2,578
2,578
2,561
2,847
(11,883
)
(19,588
)
(17,326
)
(19,415
)
(4,412
)
$
4,710
$
(17,250
)
$
(14,230
)
$
(13,316
)
$
(17,043
)
$
(12,665
)
$
442,634
$
495,495
$
782,147
$
736,121
$
702,661
$
688,893
$
536
$
1,317
$
2,235
$
2,405
$
1,498
$
(24
)
856
856
856
856
2,939
780
951
762
874
(2,964
)
5,404
9,012
9,025
10,889
8,920
10,242
$
8,879
$
11,109
$
13,067
$
14,912
$
12,148
$
8,110
$
328,410
$
169,231
$
226,107
$
178,309
$
146,401
$
123,380
$
$
(21,070
)
$
(18,694
)
$
(18,470
)
$
(18,271
)
$
(18,227
)
(4,169
)
(7,289
)
(8,603
)
(9,758
)
(10,920
)
(2,548
)
$
(4,169
)
$
(28,359
)
$
(27,297
)
$
(28,228
)
$
(29,191
)
$
(20,775
)
$
114,224
$
326,264
$
556,040
$
557,812
$
556,260
$
565,513
$
4,710
$
(17,250
)
$
(14,230
)
$
(13,316
)
$
(17,043
)
$
(12,665
)
$
442,634
$
495,495
$
782,147
$
736,121
$
702,661
$
688,893
Summary of Adjustments to
Operating Income, Net Income, and Earnings per Share
(In thousands except per share amounts)
Seven Months
Ended
Year Ended
December 31,
December 31,
Quarter ended
2002
2003
2004
3/31/05
6/30/05
9/30/05
$
25,326
$
46,115
$
29,046
$
3,869
$
(1,601
)
$
11,890
2,684
2,549
504
44
73
605
(536
)
(781
)
(747
)
(5
)
742
1,522
(6,317
)
(10,421
)
7,161
(1,809
)
(2,082
)
(1,286
)
(856
)
$
21,157
$
37,462
$
35,108
$
2,099
$
(2,868
)
$
12,731
$
827
$
16,128
$
13,481
$
1,292
$
(2,649
)
$
355
(4,169
)
(8,653
)
6,062
(1,770
)
(1,267
)
841
156
(156
)
5,533
(7,532
)
771
105
7,531
$
(3,342
)
$
13,008
$
12,167
$
137
$
(3,811
)
$
8,727
Seven Months
Ended
Year Ended
December 31,
December 31,
Quarter ended
2002
2003
2004
3/31/05
6/30/05
9/30/05
$
0.04
$
0.81
$
0.64
$
0.05
$
(0.10
)
$
0.01
(0.21
)
(0.16
)
(0.06
)
(0.04
)
(0.04
)
0.31
$
(0.17
)
$
0.65
$
0.58
$
0.01
$
(0.14
)
$
0.32
For the quarter ended December 31, 2005 | For the year ended December 31, 2005 | |||||||||||||||||||||||
Previously | Previously | |||||||||||||||||||||||
reported | Restatement | reported | Restatement | |||||||||||||||||||||
April 3, 2006 | adjustments | Final | April 3, 2006 | adjustments | Final | |||||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (audited) | |||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
Service, rental and maintenance, net of
service credits
|
$ | 137,043 | $ | | $ | 137,043 | $ | 592,690 | $ | | $ | 592,690 | ||||||||||||
Product sales
|
6,361 | | 6,361 | 25,882 | | 25,882 | ||||||||||||||||||
|
||||||||||||||||||||||||
Total revenue
|
143,404 | | 143,404 | 618,572 | | 618,572 | ||||||||||||||||||
|
||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Cost of products sold
|
1,330 | | 1,330 | 4,483 | | 4,483 | ||||||||||||||||||
Service, rental and maintenance (a)
|
50,593 | (1,201 | ) | 49,392 | 218,160 | (2,572 | ) | 215,588 | ||||||||||||||||
Selling and marketing
|
10,311 | | 10,311 | 43,145 | | 43,145 | ||||||||||||||||||
General and administrative
|
39,260 | (1 | ) | 39,259 | 177,438 | | 177,438 | |||||||||||||||||
Depreciation, amortization and accretion (a)
|
38,809 | (12,176 | ) | 26,633 | 153,403 | (22,075 | ) | 131,328 | ||||||||||||||||
Stock based compensation
|
579 | | 579 | 2,832 | | 2,832 | ||||||||||||||||||
Severance and restructuring
|
714 | (1 | ) | 713 | 16,609 | | 16,609 | |||||||||||||||||
|
||||||||||||||||||||||||
Total operating expenses
|
141,596 | (13,379 | ) | 128,217 | 616,070 | (24,647 | ) | 591,423 | ||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Operating income
|
1,808 | 13,379 | 15,187 | 2,502 | 24,647 | 27,149 | ||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Interest expense
|
(35 | ) | | (35 | ) | (2,412 | ) | | (2,412 | ) | ||||||||||||||
Interest income
|
443 | | 443 | 1,089 | | 1,089 | ||||||||||||||||||
Loss on extinguishment of long-term debt
|
| | | (1,338 | ) | | (1,338 | ) | ||||||||||||||||
Other income, net
|
(1,144 | ) | | (1,144 | ) | (1,004 | ) | | (1,004 | ) | ||||||||||||||
|
||||||||||||||||||||||||
Income before income tax expense
|
$ | 1,072 | $ | 13,379 | $ | 14,451 | $ | (1,163 | ) | $ | 24,647 | $ | 23,484 | |||||||||||
|
||||||||||||||||||||||||
Income tax expense
|
(6,597 | ) | (10,577 | ) | ||||||||||||||||||||
|
||||||||||||||||||||||||
Net income
|
$ | 7,854 | $ | 12,907 | ||||||||||||||||||||
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Reconciliation of operating income to EBITDA:
|
||||||||||||||||||||||||
Operating income
|
$ | 1,808 | $ | 13,379 | $ | 15,187 | $ | 2,502 | $ | 24,647 | $ | 27,149 | ||||||||||||
Addback:
|
||||||||||||||||||||||||
Depreciation, amortization and accretion
|
38,809 | (12,176 | ) | 26,633 | 153,403 | (22,075 | ) | 131,328 | ||||||||||||||||
|
||||||||||||||||||||||||
EBITDA (b)
|
$ | 40,617 | $ | 1,203 | $ | 41,820 | $ | 155,905 | $ | 2,572 | $ | 158,477 | ||||||||||||
|
(a) | Previously (as reported April 3, 2006), USA Mobility included accretion expense in service, rental and maintenance expense; final figures reflect accretion expense as part of depreciation, amortization and accretion. | |
(b) | EBITDA or Earnings before interest, taxes, depreciation and amortization is a non-GAAP measure and is presented for analytical purposes only. |