EX-99.1 2 d533575dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

NEWS RELEASE

LOGO

 

FOR IMMEDIATE RELEASE    CONTACT:   Bob Lougee (800) 611-8488
Thursday, May 9, 2013      bob.lougee@usamobility.com

USA Mobility Reports First Quarter Operating Results;

Board Declares Regular Quarterly Dividend

Wireless Subscriber and Revenue Trends Continue to Improve;

Software Revenues Increase, Bookings and Backlog Remain Strong;

Operating Cash Flow Higher as Expenses Decline

Springfield, VA (May 9, 2013) — USA Mobility, Inc. (Nasdaq: USMO), a leading provider of wireless messaging, mobile voice and data and unified communications solutions, today announced operating results for the first quarter ended March 31, 2013. In addition, the Company’s Board of Directors declared a regular quarterly dividend of $0.125 per share, payable on June 25, 2013 to stockholders of record on May 20, 2013.

Consolidated revenue for the first quarter was $53.1 million, compared to $51.9 million in the fourth quarter and $56.7 million in the first quarter of 2012. Revenue from the Company’s Wireless business (USA Mobility Wireless) was $38.8 million in the first quarter, compared to $39.9 million in the fourth quarter and $44.3 million in the first quarter of 2012. Revenue from the Software business (Amcom Software) increased to $14.4 million, from $12.0 million in the fourth quarter and $12.5 million in the first quarter of 2012.

First quarter EBITDA (earnings before interest, taxes, depreciation, amortization and accretion) totaled $15.5 million, or 29.3 percent of revenue, compared to $18.8 million, or 33.1 percent of revenue, in the year-earlier quarter. First quarter EBITDA included $14.3 million from Wireless and $1.2 million from Software. EBITDA from Wireless of $14.3 million compared to $14.0 million in the prior quarter and $17.5 million in the year-earlier quarter.

Net income for the first quarter was $6.9 million, or $0.32 per fully diluted share, compared to $8.5 million, or $0.37 per fully diluted share, in the first quarter of 2012.


Key results and highlights for the first quarter included:

Wireless

 

   

Net unit losses improved to 35,000 in the first quarter from 51,000 in the first quarter of 2012, while the quarterly rate of unit erosion was 2.3 percent versus 3.0 percent in the year-earlier quarter. The annual rate of subscriber erosion improved to a record low 8.5 percent in the first quarter, compared to 9.2 percent in the fourth quarter and 11.5 percent in the year-ago quarter. Units in service at March 31, 2013 totaled 1,480,000, compared to 1,617,000 a year earlier.

 

   

The quarterly rate of revenue erosion improved to 2.9 percent from 4.9 percent in the first quarter of 2012, while the annual rate of revenue erosion improved to 12.4 percent from 15.7 percent in the year-earlier quarter.

 

   

Total ARPU (average revenue per unit) was $8.25 in the first quarter, compared to $8.29 in the fourth quarter and $8.50 in the first quarter of 2012.

 

   

First quarter EBITDA margin for Wireless was 36.9 percent, compared to 35.0 percent in the fourth quarter and 39.5 percent in the year-earlier quarter.

Software

 

   

Bookings for the first quarter increased to $14.3 million from $12.4 million in the first quarter of 2012.

 

   

The backlog was $40.2 million at March 31, 2013, compared to $32.7 million a year earlier (as restated).

 

   

Of the $14.4 million in Software revenue for the first quarter, $6.8 million was maintenance revenue and $7.6 million was operations revenue, compared to $6.4 million and $6.1 million, respectively, of the $12.5 million in Software revenue for first quarter of 2012.

 

   

The renewal rate for maintenance in the first quarter was 98.8 percent.

Total Company

 

   

Consolidated operating expenses (excluding depreciation, amortization and accretion) totaled $37.6 million in the first quarter, with $24.5 million for Wireless and $13.1 million for Software, compared to $38.0 million in the first quarter of 2012, with $26.8 million for Wireless and $11.2 million for Software.

 

   

Capital expenses were $2.3 million, compared to $1.6 million in the first quarter of 2012.

 

   

Dividends paid to stockholders totaled $2.7 million in the first quarter.

 

   

The Company’s cash balance at March 31, 2013 was $71.7 million.

 

   

The number of full-time equivalent employees at March 31, 2013 totaled 656, including 367 for Wireless and 289 for Software, compared to a total of 685 at March 31, 2012, including 420 for Wireless and 265 for Software.


Vincent D. Kelly, president and chief executive officer, said: “USA Mobility continued to make excellent progress in the first quarter. Both our Wireless and Software businesses met or exceeded their performance goals in virtually all operating categories as consolidated revenue increased and expenses declined from the prior quarter. In addition, we continued to maintain strong operating cash flow and operating margins, and generated sufficient cash flow to again return capital to stockholders in the form of dividend distributions.”

Kelly added: “Once again our Wireless business exceeded expectations for gross additions, revenue, ARPU, and expenses. We were also pleased to see our annual rates of subscriber and revenue erosion reach record lows.”

Kelly said the Company’s Wireless sales efforts during the quarter continued to focus on the core market segments of Healthcare, Government and Large Enterprise. “These core segments represented approximately 92 percent of our direct subscriber base and 88 percent of our direct paging revenue at the end of the quarter. Healthcare comprised 72.5 percent of our direct subscriber base at March 31st and continued to be our best performing market segment with the highest percentage of direct gross additions (82.6%) and the lowest rate of direct net unit loss (0.5%). Clearly, Healthcare providers continue to recognize and benefit from the reliability and cost advantages of paging for their most critical messaging needs.”

Commenting on the Software business, Kelly said: “First quarter revenue and bookings increased from the year-earlier quarter while our backlog was up 23 percent to $40.2 million from a year ago. In addition, our sales team brought in a record number of large contracts during the quarter from the Healthcare and Government business segments and continued to build a solid pipeline of prospective business. Customer demand remained strong for such software solutions as call center management, clinical alerting middleware, critical smartphone communications and emergency notification. While sales activity remained strongest in North America, we also added new accounts in the Asia-Pacific region and Middle East, including a major medical and research center in Qatar.”

During the quarter the Company introduced a software upgrade that significantly improves physician and nurse communications. “The enhancement links two of our most popular software solutions, Amcom Mobile Connect and Amcom Care Connect,” said Kelly. “Amcom Mobile Connect supports secure and HIPPA-compliant text-messaging, while Amcom Care Connect helps caregivers connect quickly on their own


schedules and preferred devices. The new feature — Amcom Mobile Connect 3.3 — provides a “chat view” screen and updates page that makes it easier for caregivers to connect with one another. The solution gives physicians and nurses the flexibility to talk or text, plus it incorporates critical escalation features when a caregiver is unavailable. Many of our 900 hospital customers had previously requested this specific type of solution, so we’re very pleased to be able to integrate this capability to enhance patient safety and care.”

Shawn E. Endsley, chief financial officer, said the Company continued its positive momentum from 2012 in both the Wireless and Software businesses. “Lower revenue and subscriber churn along with operating expense management in the Wireless business contributed to strong operating cash flow and EBITDA,” he noted. “In addition, higher bookings and backlog in the Software business reflect continuation of the positive trends from the second half of 2012.”

Regarding financial guidance for 2013, Endsley said the Company currently projects total revenue to range from $195 million to $213 million, operating expenses (excluding depreciation, amortization and accretion) to range from $150 million to $152 million, and capital expenses to range from $8.1 million to $9.7 million.

USA Mobility’s Annual Meeting of Stockholders will be held at 9:00 am EST on Tuesday, July 23, 2013 at The Westin Alexandria, 400 Courthouse Square, Alexandria, Virginia.

* * * * * * * * *

USA Mobility plans to host a conference call for investors on its first quarter results at 10:00 a.m. Eastern Time on Friday, May 10, 2013. Dial-in numbers for the call are 719-325-2432 or 888-417-8516. The pass code for the call is 8073557. A replay of the call will be available from 1:00 p.m. ET on May 10 until 1:00 p.m. on Friday, May 24. Replay numbers are 719-457-0820 or 888-203-1112. The pass code for the replay is 8073557.

* * * * * * * * *

About USA Mobility

USA Mobility, Inc., headquartered in Springfield, Virginia, is a comprehensive provider of reliable and affordable wireless communications solutions to the healthcare, government, large enterprise and emergency response sectors through its wireless subsidiary, USA Mobility Wireless. In addition, through its software subsidiary, Amcom Software, it provides mission critical unified communications solutions nationally and internationally to leading organizations in such industries as healthcare, hospitality, education, business and government. Amcom connects people to each other and the data the need. Its software solutions include critical smartphone communications, contact center optimization, emergency management and clinical workflow improvement. As a single-source provider, USA Mobility Wireless focuses on the business-to-business


marketplace and supplies wireless connectivity solutions to organizations nationwide. The Company operates the largest one-way paging and advanced two-way paging networks in the United States. USA Mobility Wireless also offers mobile voice and data services through Sprint Nextel and T-Mobile, including BlackBerry® smartphones and GPS location applications. Its product offerings include customized wireless connectivity systems for the healthcare, government and other campus environments. For further information visit www.usamobility.com and www.amcomsoftware.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act: Statements contained herein or in prior press releases which are not historical fact, such as statements regarding USA Mobility’s future operating and financial performance, are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that may cause USA Mobility’s actual results to be materially different from the future results expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expectations include, but are not limited to, declining demand for paging products and services, continued growth of our Software business and demand for our Software products and services, our ability to develop additional software solutions for our customers, the ability to continue to reduce operating expenses, future capital needs, competitive pricing pressures, competition from both traditional paging services and other wireless communications services, competition from other software providers, government regulation, reliance upon third-party providers for certain equipment and services, as well as other risks described from time to time in periodic reports and registration statements filed with the Securities and Exchange Commission. Although USA Mobility believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. USA Mobility disclaims any intent or obligation to update any forward-looking statements.

Tables to Follow


USA MOBILITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (a)

(Unaudited and in thousands, except share, per share amounts and ARPU)

 

     For the three months ended March 31,  
     2013     2012  
     Wireless     Software     Total     Wireless     Software     Total  

Revenue:

            

Paging service

   $ 37,051      $ —        $ 37,051      $ 41,875      $ —        $ 41,875   

Cellular

     195        —          195        277        —          277   

Software revenue and other (b)

     1,372        14,351        15,723        1,787        12,470        14,257   

Other

     161        —          161        326        —          326   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

     38,779        14,351        53,130        44,265        12,470        56,735   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

            

Cost of products sold (b)

     (5     5,188        5,183        173        4,643        4,816   

Service, rental and maintenance (b)

     10,829        2,203        13,032        12,034        2,269        14,303   

Selling and marketing

     2,476        3,740        6,216        3,048        2,605        5,653   

General and administrative

     11,181        1,971        13,152        11,508        1,661        13,169   

Severance and restructuring

     —          —          —          9        13        22   

Depreciation, amortization and accretion

     2,396        1,411        3,807        2,815        1,700        4,515   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     26,877        14,513        41,390        29,587        12,891        42,478   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% of total revenue

     69.3     101.1     77.9     66.8     103.4     74.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

     11,902        (162     11,740        14,678        (421     14,257   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% of total revenue

     30.7     –1.1     22.1     33.2     –3.4     25.1

Interest expense, net

     (64     —          (64     (188     —          (188

Other income (expense), net

     89        (8     81        (46     (16     (62
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income tax (expense) benefit

     11,927        (170     11,757        14,444        (437     14,007   

Income tax (expense) benefit

     (4,897     65        (4,832     (5,718     173        (5,545
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 7,030      $ (105   $ 6,925      $ 8,726      $ (264   $ 8,462   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic net income per common share

       $ 0.32          $ 0.38   
      

 

 

       

 

 

 

Diluted net income per common share

       $ 0.32          $ 0.37   
      

 

 

       

 

 

 

Basic weighted average common shares outstanding

         21,688,153            22,106,543   
      

 

 

       

 

 

 

Diluted weighted average common shares outstanding

         21,904,862            22,589,483   
      

 

 

       

 

 

 

Reconciliation of operating income (loss) to EBITDA (c):

            

Operating income (loss)

   $ 11,902      $ (162   $ 11,740      $ 14,678      $ (421   $ 14,257   

Add back: depreciation, amortization and accretion

     2,396        1,411        3,807        2,815        1,700        4,515   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 14,298      $ 1,249      $ 15,547      $ 17,493      $ 1,279      $ 18,772   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% of total revenue

     36.9     8.7     29.3     39.5     10.3     33.1

Key statistics:

            

Units in service

     1,480        —          1,480        1,617        —          1,617   

Average revenue per unit (ARPU)

   $ 8.25      $ —        $ 8.25      $ 8.50      $ —        $ 8.50   

Bookings

   $ —        $ 14,253      $ 14,253      $ —        $ 12,417      $ 12,417   

Backlog

   $ —        $ 40,183      $ 40,183      $ —        $ 32,688      $ 32,688   

 

(a) Slight variations in totals are due to rounding.
(b) Wireless results reflect eliminations for intercompany revenue and expenses.
(c) EBITDA or earnings before interest, taxes, depreciation, amortization and accretion is a non-GAAP measure and is presented for analytical purposes only.


USA MOBILITY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (a)

(In thousands)

 

     3/31/13      12/31/12  
     (Unaudited)         

Assets

     

Current assets:

     

Cash and cash equivalents

   $ 71,694       $ 61,046   

Accounts receivable, net

     20,191         21,580   

Prepaid expenses and other

     5,907         5,836   

Inventory

     3,032         3,257   

Escrow receivables

     275         275   

Deferred income tax assets, net

     4,929         3,915   
  

 

 

    

 

 

 

Total current assets

     106,028         95,909   

Property and equipment, net

     20,783         20,809   

Goodwill

     133,031         133,031   

Other intangible assets, net

     29,088         30,333   

Deferred income tax assets, net

     35,642         41,239   

Other assets

     1,243         1,306   
  

 

 

    

 

 

 

Total assets

   $ 325,815       $ 322,627   
  

 

 

    

 

 

 

Liabilities and stockholders’ equity

     

Current liabilities:

     

Accounts payable and accrued liabilities

   $ 12,876       $ 12,659   

Accrued compensation and benefits

     16,715         17,806   

Consideration payable

     275         275   

Customer deposits

     2,660         2,090   

Deferred revenue

     26,911         27,896   
  

 

 

    

 

 

 

Total current liabilities

     59,437         60,726   

Deferred revenue

     605         693   

Other long-term liabilities

     9,594         9,789   
  

 

 

    

 

 

 

Total liabilities

     69,636         71,208   
  

 

 

    

 

 

 

Commitments and contingencies

     

Stockholders’ equity:

     

Preferred stock

     —           —     

Common stock

     2         2   

Additional paid-in capital

     125,823         125,212   

Retained earnings

     130,354         126,205   
  

 

 

    

 

 

 

Total stockholders’ equity

     256,179         251,419   
  

 

 

    

 

 

 

Total liabilities and stockholders’ equity

   $ 325,815       $ 322,627   
  

 

 

    

 

 

 

 

(a) Slight variations in totals are due to rounding.


USA MOBILITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (a)

(Unaudited and in thousands)

 

     For the three months ended  
     3/31/13     3/31/12  

Cash flows from operating activities:

    

Net income

   $ 6,925      $ 8,462   

Adjustments to reconcile net income to net cash provided by operating activities:

    

Depreciation, amortization and accretion

     3,807        4,515   

Amortization of deferred financing costs

     64        65   

Deferred income tax expense

     4,570        5,387   

Amortization of stock based compensation

     626        437   

Provision for doubtful accounts, service credits and other

     405        411   

Adjustment of non-cash transaction taxes

     (132     (123

(Gain)/Loss on disposals of property and equipment

     (1     162   

Changes in assets and liabilities:

    

Accounts receivable

     984        358   

Prepaid expenses, intangibles and other assets

     161        118   

Accounts payable and accrued liabilities

     (1,236     (3,680

Customer deposits and deferred revenue

     (503     (171
  

 

 

   

 

 

 

Net cash provided by operating activities

     15,670        15,941   
  

 

 

   

 

 

 

Cash flows from investing activities:

    

Purchase of property and equipment

     (2,341     (1,551

Proceeds from disposals of property and equipment

     1        8   
  

 

 

   

 

 

 

Net cash used in investing activities

     (2,340     (1,543
  

 

 

   

 

 

 

Cash flows from financing activities:

    

Repayment of debt

     —          (25,000

Cash dividends to stockholders

     (2,682     (5,535
  

 

 

   

 

 

 

Net cash used in financing activities

     (2,682     (30,535
  

 

 

   

 

 

 

Net increase/(decrease) in cash and cash equivalents

     10,648        (16,137

Cash and cash equivalents, beginning of period

     61,046        53,655   
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

   $ 71,694      $ 37,518   
  

 

 

   

 

 

 

Supplemental disclosure:

    

Interest paid

   $ 4      $ 220   
  

 

 

   

 

 

 

Income taxes paid

   $ 168      $ 224   
  

 

 

   

 

 

 

 

(a) Slight variations in totals are due to rounding.


USA MOBILITY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (a)

(Unaudited and in thousands, except share, per share amounts and ARPU)

 

     For the three months ended  
     3/31/13     12/31/12     9/30/12     6/30/12     3/31/12  

Revenues:

          

Paging service

   $ 37,051      $ 38,081      $ 39,235      $ 40,548      $ 41,875   

Cellular

     195        275        314        286        277   

Software revenue and other

     15,723        13,381        15,321        14,847        14,257   

Other

     161        147        246        280        326   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     53,130        51,884        55,116        55,961        56,735   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

          

Cost of products sold

     5,183        5,709        5,105        5,216        4,816   

Service, rental and maintenance

     13,032        13,499        13,731        13,892        14,303   

Selling and marketing

     6,216        6,030        6,043        5,919        5,653   

General and administrative

     13,152        12,551        12,466        12,494        13,169   

Severance and restructuring

     —          1,712        —          24        22   

Depreciation, amortization and accretion

     3,807        4,387        4,724        4,606        4,515   

Impairment

     —          3,382        —          —          —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     41,390        47,270        42,069        42,151        42,478   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% of total revenues

     77.9     91.1     76.3     75.3     74.9

Operating income

     11,740        4,614        13,047        13,810        14,257   

% of total revenues

     22.1     8.9     23.7     24.7     25.1

Interest expense, net

     (64     (62     (64     (66     (188

Other income (expense), net

     81        289        52        436        (62
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income tax expense

     11,757        4,841        13,035        14,180        14,007   

Income tax expense

     (4,832     (2,814     (4,987     (5,733     (5,545
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 6,925      $ 2,027      $ 8,048      $ 8,447      $ 8,462   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic net income per common share

   $ 0.32      $ 0.09      $ 0.37      $ 0.38      $ 0.38   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted net income per common share

   $ 0.32      $ 0.09      $ 0.36      $ 0.37      $ 0.37   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic weighted average common shares outstanding

     21,688,153        21,492,792        21,973,473        22,130,397        22,106,543   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted weighted average common shares outstanding

     21,904,862        22,991,673        22,399,934        22,613,517        22,589,483   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation of operating income to EBITDA (b):

          

Operating income

   $ 11,740      $ 4,614      $ 13,047      $ 13,810      $ 14,257   

Add back: depreciation, amortization, accretion and impairment

     3,807        7,769        4,724        4,606        4,515   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 15,547      $ 12,383      $ 17,771      $ 18,416      $ 18,772   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

% of total revenues

     29.3     23.9     32.2     32.9     33.1

Key statistics:

          

Units in service

     1,480        1,515        1,546        1,583        1,617   

Average revenue per unit (ARPU)

   $ 8.25      $ 8.29      $ 8.36      $ 8.45      $ 8.50   

Bookings

   $ 14,253      $ 18,129      $ 15,670      $ 15,085      $ 12,417   

Backlog

   $ 40,183      $ 40,626      $ 36,155      $ 34,391      $ 32,688   

 

(a) Slight variations in totals are due to rounding.
(b) EBITDA or earnings before interest, taxes, depreciation, amortization, accretion and impairment is a non-GAAP measure and is presented for analytical purposes only.


USA MOBILITY, INC.

CONSOLIDATED OPERATING EXPENSES

SUPPLEMENTAL INFORMATION (a)

(Unaudited and in thousands)

 

     For the three months ended  
     3/31/13      12/31/12      9/30/12      6/30/12     3/31/12  

Cost of products sold

             

Payroll and related

   $ 2,838       $ 2,634       $ 2,427       $ 2,324      $ 2,368   

Cost of sales

     1,890         2,500         2,195         2,434        2,037   

Other

     455         575         483         458        411   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total cost of products sold

     5,183         5,709         5,105         5,216        4,816   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Service, rental and maintenance

             

Site rent

     4,235         4,326         4,326         4,421        4,791   

Telecommunications

     1,889         2,053         2,257         2,346        2,312   

Payroll and related

     5,203         5,432         5,309         5,360        5,529   

Stock based compensation

     10         7         6         6        6   

Other

     1,695         1,681         1,833         1,759        1,665   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total service, rental and maintenance

     13,032         13,499         13,731         13,892        14,303   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Selling and marketing

             

Payroll and related

     3,594         3,519         3,504         3,544        3,559   

Commissions

     1,387         1,197         1,335         1,343        1,253   

Stock based compensation

     17         19         19         18        16   

Other

     1,218         1,295         1,185         1,014        825   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total selling and marketing

     6,216         6,030         6,043         5,919        5,653   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

General and administrative

             

Payroll and related

     6,026         6,423         5,851         5,972        6,490   

Stock based compensation

     599         296         435         (19     415   

Bad debt

     275         300         275         270        234   

Facility rent

     844         889         903         868        806   

Telecommunications

     375         379         390         443        412   

Outside services

     3,077         2,377         2,353         2,458        2,447   

Taxes, licenses and permits

     1,233         1,312         1,249         1,426        1,501   

Other

     723         575         1,010         1,076        864   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total general and administrative

     13,152         12,551         12,466         12,494        13,169   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Severance and restructuring

     —           1,712         —           24        22   

Depreciation, amortization and accretion

     3,807         4,387         4,724         4,606        4,515   

Impairment

     —           3,382         —           —          —     
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total operating expenses

   $ 41,390       $ 47,270       $ 42,069       $ 42,151      $ 42,478   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Capital expenditures

   $ 2,341       $ 2,854       $ 2,696       $ 2,888      $ 1,551   

 

(a) Slight variations in totals are due to rounding.


USA MOBILITY, INC. (WIRELESS)

UNITS IN SERVICE ACTIVITY (a)

(Unaudited and in thousands)

 

     For the three months ended  
     3/31/13     12/31/12     9/30/12     6/30/12     3/31/12  

Units in service

          

Beginning units in service

          

Direct one-way

     1,346        1,366        1,395        1,423        1,465   

Direct two-way

     75        79        82        85        90   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     1,421        1,445        1,477        1,508        1,555   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Indirect one-way

     48        55        58        60        63   

Indirect two-way

     46        46        48        49        50   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     94        101        106        109        113   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total beginning units in service

     1,515        1,546        1,583        1,617        1,668   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross placements

          

Direct one-way

     39        46        45        49        41   

Direct two-way

     3        2        3        4        3   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     42        48        48        53        44   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Indirect one-way

     1        2        1        2        1   

Indirect two-way

     —          —          —          —          —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     1        2        1        2        1   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total gross placements

     43        50        49        55        45   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross disconnects

          

Direct one-way

     (61     (66     (74     (77     (83

Direct two-way

     (5     (6     (6     (7     (8
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     (66     (72     (80     (84     (91
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Indirect one-way

     (11     (9     (4     (4     (4

Indirect two-way

     (1     —          (2     (1     (1
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     (12     (9     (6     (5     (5
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total gross disconnects

     (78     (81     (86     (89     (96
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

          

Direct one-way

     (22     (20     (29     (28     (42

Direct two-way

     (2     (4     (3     (3     (5
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     (24     (24     (32     (31     (47
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Indirect one-way

     (10     (7     (3     (2     (3

Indirect two-way

     (1     —          (2     (1     (1
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     (11     (7     (5     (3     (4
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total net change

     (35     (31     (37     (34     (51
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ending units in service

          

Direct one-way

     1,324        1,346        1,366        1,395        1,423   

Direct two-way

     73        75        79        82        85   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     1,397        1,421        1,445        1,477        1,508   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Indirect one-way

     38        48        55        58        60   

Indirect two-way

     45        46        46        48        49   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     83        94        101        106        109   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total ending units in service

     1,480        1,515        1,546        1,583        1,617   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) Slight variations in totals are due to rounding.


USA MOBILITY, INC. (WIRELESS)

AVERAGE REVENUE PER UNIT (ARPU) AND CHURN (a)

(Unaudited)

 

     For the three months ended  
     3/31/13     12/31/12     9/30/12     6/30/12     3/31/12  

ARPU

          

Direct one-way

   $ 7.73      $ 7.78      $ 7.84      $ 7.89      $ 7.91   

Direct two-way

     20.41        20.52        20.55        20.88        21.08   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     8.40        8.47        8.54        8.62        8.67   

Indirect one-way

     8.22        7.51        7.25        7.48        7.61   

Indirect two-way

     3.76        3.87        4.08        4.19        4.33   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     5.85        5.74        5.77        5.97        6.14   

Total one-way

     7.74        7.77        7.82        7.88        7.90   

Total two-way

     13.96        14.16        14.36        14.69        15.00   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total paging ARPU

   $ 8.25      $ 8.29      $ 8.36      $ 8.45      $ 8.50   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross disconnect rate (b)

          

Direct one-way

     –4.6     –4.8     –5.3     –5.4     –5.7

Direct two-way

     –6.6     –7.8     –7.7     –8.5     –8.3
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     4.7     5.0     5.5     5.6     5.8

Indirect one-way

     –23.6     –16.1     –7.6     –6.6     –7.0

Indirect two-way

     –1.6     –1.6     –3.1     –1.8     –1.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     12.5     9.3     5.5     4.4     4.7

Total one-way

     –5.2     –5.3     –5.4     –5.4     –5.8

Total two-way

     –4.7     –5.4     –6.0     –6.0     –5.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total paging gross disconnect rate

     5.2     5.3     5.5     5.5     5.8
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss (c)

          

Direct one-way

     –1.7     –1.5     –2.1     –1.9     –2.9

Direct two-way

     –1.9     –4.9     –4.0     –3.9     –4.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     1.7     1.7     2.2     2.0     3.0

Indirect one-way

     –21.8     –13.2     –5.6     –4.9     –5.4

Indirect two-way

     –1.3     –1.3     –2.5     –1.2     –0.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total indirect

     11.5     7.6     4.2     3.2     3.4

Total one-way

     –2.4     –1.9     –2.2     –2.0     –3.0

Total two-way

     –1.6     –3.5     –3.5     –2.9     –3.5
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total paging net loss rate

     2.3     2.0     2.3     2.1     3.0
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) Slight variations in totals are due to rounding.
(b) Gross disconnect rate is current period disconnected units divided by prior period ending units in service.
(c) Net loss rate is net current period placements and disconnected units in service divided by prior period ending units in service.


USA MOBILITY, INC. (WIRELESS)

SUPPLEMENTAL INFORMATION BY MARKET SEGMENT (a)

(Unaudited)

 

     For the three months ended  
     3/31/13     12/31/12     9/30/12     6/30/12     3/31/12  

Gross placement rate (b)

          

Healthcare

     3.4     3.9     3.7     4.3     3.3

Government

     1.6     1.5     2.5     1.8     1.3

Large enterprise

     2.1     2.3     2.0     1.9     2.4

Other

     1.8     1.9     2.1     2.0     2.2
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     3.0     3.3     3.2     3.5     2.8

Total indirect

     1.0     1.7     1.3     1.2     1.3
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     2.9     3.2     3.1     3.4     2.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross disconnect rate (b)

          

Healthcare

     –3.9     –4.4     –4.5     –4.5     –4.7

Government

     –5.9     –6.7     –6.8     –7.0     –7.7

Large enterprise

     –7.0     –5.7     –7.3     –8.0     –7.7

Other

     –7.3     –7.0     –8.1     –8.7     –9.2
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     4.7     5.0     5.5     5.6     5.8

Total indirect

     12.5     9.3     5.5     4.4     4.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     5.2     5.3     5.5     5.5     5.8
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss rate (b)

          

Healthcare

     –0.5     –0.4     –0.9     –0.2     –1.4

Government

     –4.3     –5.2     –4.3     –5.2     –6.4

Large enterprise

     –4.9     –3.4     –5.3     –6.1     –5.3

Other

     –5.5     –5.1     –5.9     –6.8     –7.1
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     1.7     1.7     2.2     2.0     3.0

Total indirect

     11.5     7.6     4.2     3.2     3.4
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     2.3     2.0     2.3     2.1     3.0
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

End of period units in service % of total (b)

          

Healthcare

     68.4     67.1     65.9     64.9     63.6

Government

     10.1     10.3     10.8     11.1     11.5

Large enterprise

     8.3     8.5     8.6     8.9     9.3

Other

     7.6     7.9     8.1     8.4     8.8
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total direct

     94.4     93.8     93.4     93.3     93.2

Total indirect

     5.6     6.2     6.6     6.7     6.8
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     100.0     100.0     100.0     100.0     100.0
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) Slight variations in totals are due to rounding.
(b) Changes in the classification of units in service are reflected in the quarter when such changes are identified.

Such changes are then appropriately reflected in calculating the gross placement, gross disconnect and net loss rates.


USA MOBILITY, INC. (WIRELESS)

SUPPLEMENTAL INFORMATION - DIRECT UNITS IN SERVICE AND

CELLULAR ACTIVATIONS (a)

(Unaudited)

 

     For the three months ended  
     3/31/13     12/31/12     9/30/12     6/30/12     3/31/12  

Account size ending units in service (000’s)

          

1 to 3 units

     49        52        55        58        61   

4 to 10 units

     29        31        33        35        37   

11 to 50 units

     71        75        78        82        86   

51 to 100 units

     47        49        50        52        54   

101 to 1,000 units

     321        334        343        356        373   

>1,000 units

     880        880        886        894        897   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     1,397        1,421        1,445        1,477        1,508   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

End of period units in service % of total direct

          

1 to 3 units

     3.5     3.6     3.8     3.9     4.1

4 to 10 units

     2.1     2.2     2.3     2.3     2.3

11 to 50 units

     5.1     5.3     5.4     5.6     5.7

51 to 100 units

     3.4     3.5     3.5     3.5     3.6

101 to 1,000 units

     23.0     23.5     23.7     24.1     24.8

>1,000 units

     62.9     61.9     61.3     60.6     59.5
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     100.0     100.0     100.0     100.0     100.0
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Account size net loss rate

          

1 to 3 units

     –4.8     –5.5     –5.3     –5.7     –6.2

4 to 10 units

     –6.0     –5.5     –4.8     –6.2     –6.2

11 to 50 units

     –4.8     –4.6     –4.8     –4.1     –7.1

51 to 100 units

     –4.0     –2.6     –3.9     –2.4     –3.9

101 to 1,000 units

     –3.9     –2.6     –3.8     –4.7     –1.7

>1,000 units

     –0.2     –0.6     –1.0     –0.3     –2.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

     1.7     1.7     2.2     2.0     3.0
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Account size ARPU

          

1 to 3 units

   $ 15.22      $ 15.29      $ 15.43      $ 15.49      $ 15.49   

4 to 10 units

     14.33        14.39        14.42        14.40        14.45   

11 to 50 units

     12.06        12.04        12.11        12.24        12.15   

51 to 100 units

     10.47        10.47        10.48        10.35        10.52   

101 to 1,000 units

     8.84        8.94        8.97        9.01        9.04   

>1,000 units

     7.23        7.24        7.28        7.34        7.35   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 8.40      $ 8.47      $ 8.54      $ 8.62      $ 8.67   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cellular:

          

Number of activations

     925        1,041        948        1,052        1,070   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revenue from cellular services (000’s)

   $ 195      $ 275      $ 314      $ 286      $ 277   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) Slight variations in totals are due to rounding.


USA MOBILITY, INC.

2013 FINANCIAL GUIDANCE

 

     (In millions)  
     Guidance Range  
     From      To  

Revenues

     

Wireless

   $ 140       $ 150   

Software

     55         63   
  

 

 

    

 

 

 

Combined

   $ 195       $ 213   
  

 

 

    

 

 

 

Operating Expenses (a)

     

Wireless

   $ 99       $ 92   

Software

     53         58   
  

 

 

    

 

 

 

Combined

   $ 152       $ 150   
  

 

 

    

 

 

 

Capital Expenses

     

Wireless

   $ 9.5       $ 7.5   

Software

     0.2         0.6   
  

 

 

    

 

 

 

Combined

   $ 9.7       $ 8.1   
  

 

 

    

 

 

 

 

(a) Operating expenses exclude depreciation, amortization and accretion.