Delaware
|
001-33449
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20-8259086
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||
(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.)
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55 Hammarlund Way
Middletown, RI
|
02842
|
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(Address of principal executive offices)
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(Zip Code)
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(Former name or former address, if changed since last report)
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99.1
|
Press Release, dated August 15, 2011
|
TOWERSTREAM CORPORATION
|
|||
Date: August 15, 2011
|
By:
|
/s/ Joseph P. Hernon | |
Joseph P. Hernon | |||
Chief Financial Officer | |||
Exhibit No.
|
Description
|
99.1
|
Press Release, dated August 15, 2011
|
·
|
Revenues increased 11% to $6.6 million during the second quarter 2011 compared to the first quarter 2011 and increased 35% compared to the second quarter 2010
|
·
|
Wi-Fi offload program spending reduced gross margin in the second quarter 2011 by 2% to 72% compared to 75% for both the first quarter 2011 and second quarter 2010
|
·
|
Adjusted Market EBITDA profitability increased to $3.4 million in the second quarter 2011 as compared to $3.1 million for the first quarter 2011 and $2.4 million for the second quarter 2010
|
·
|
Adjusted EBITDA profitability, excluding non-recurring expenses and costs associated with the Wi-Fi offload program, increased to $1.1 million for the second quarter 2011 compared to $0.8 million for the first quarter 2011 and $0.3 million for the second quarter 2010
|
·
|
Customer churn remained stable for second and first quarters 2011 at 1.56% compared to 1.15% during the second quarter 2010
|
·
|
Costs associated with the Company’s Wi-Fi offload program, including capital expenditures, totaled $2.2 million in the second quarter 2011 as compared to $1.2 million in the first quarter 2011 and $0.6 million in the second quarter 2010
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·
|
Gain of $0.6 million recognized on the acquisition of One Velocity which expands the Company’s presence into Las Vegas
|
(Unaudited)
|
||||||||||||
Three months ended
|
||||||||||||
6/30/2011
|
3/31/2011
|
6/30/2010
|
||||||||||
Selected Financial Data
|
||||||||||||
Revenues
|
$ | 6,581 | $ | 5,953 | $ | 4,869 | ||||||
Gross margin
|
72 | % | 75 | % | 75 | % | ||||||
Adjusted gross margin excluding Wi-Fi offload program expenses
|
74 | % | 75 | % | 75 | % | ||||||
Depreciation and amortization
|
2,213 | 1,975 | 1,454 | |||||||||
Core operating expenses (1)( 2)
|
4,379 | 3,986 | 3,893 | |||||||||
Operating loss (1)
|
(1,857 | ) | (1,514 | ) | (1,685 | ) | ||||||
Gain on business acquisition
|
564 | - | 356 | |||||||||
Net loss (1)
|
(1,294 | ) | (1,513 | ) | (1,306 | ) | ||||||
Adjusted EBITDA (2)
|
536 | 593 | 46 | |||||||||
Non-recurring expenses
|
135 | 49 | 245 | |||||||||
Wi-Fi offload program
|
404 | 121 | - | |||||||||
Adjusted EBITDA excluding non-recurring and
Wi-Fi offload program expenses(2)
|
1,075 | 763 | 291 | |||||||||
Capital expenditures
|
||||||||||||
Wireless broadband
|
$ | 2,077 | $ | 1,532 | $ | 1,173 | ||||||
Wi-Fi offload program
|
1,827 | 1,088 | 605 | |||||||||
Key Operating Metrics
|
||||||||||||
Churn rate (2)
|
1.56 | % | 1.56 | % | 1.15 | % | ||||||
ARPU (2)
|
$ | 703 | $ | 688 | $ | 671 | ||||||
ARPU of new customers (2)
|
607 | 558 | 550 |
·
|
Revenues for the third quarter 2011 are expected to range between $6.9 million to $7.1 million.
|
·
|
Adjusted EBITDA profitability is expected to range between $1.2 million to $1.4 million.
|
Three months ended
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||||||||||||
6/30/2011
|
3/31/2011
|
6/30/2010
|
||||||||||
Reconciliation of Non-GAAP to GAAP:
|
||||||||||||
Adjusted EBITDA, excluding non-recurring expenses
and Wi-Fi offload program expenses
|
$ | 1,075 | $ | 763 | $ | 291 | ||||||
Depreciation and amortization
|
(2,213 | ) | (1,975 | ) | (1,454 | ) | ||||||
Non-recurring expenses, primarily acquisition-related
|
(135 | ) | (49 | ) | (245 | ) | ||||||
Wi-Fi offload program expenses
|
(404 | ) | (121 | ) | - | |||||||
Stock-based compensation
|
(141 | ) | (106 | ) | (264 | ) | ||||||
Loss on property and equipment
|
(30 | ) | (18 | ) | (13 | ) | ||||||
Loss on nonmonetary transactions
|
(9 | ) | (8 | ) | - | |||||||
Interest expense
|
(2 | ) | (3 | ) | - | |||||||
Gain on business acquisition
|
564 | - | 356 | |||||||||
Other income (expense), net
|
(3 | ) | (2 | ) | 22 | |||||||
Interest income
|
4 | 6 | 1 | |||||||||
Net loss
|
$ | (1,294 | ) | $ | (1,513 | ) | $ | (1,306 | ) |
Statement of Operations
|
(Unaudited)
|
(Unaudited)
|
||||||||||||||
Three months
ended June 30, |
Six months
ended June 30, |
|||||||||||||||
2011
|
2010
|
2011 | 2010 | |||||||||||||
Revenues
|
$ | 6,581 | $ | 4,869 | $ | 12,534 | $ | 9,113 | ||||||||
Operating Expenses
|
||||||||||||||||
Cost of revenues (exclusive of depreciation)
|
1,846 | 1,207 | 3,352 | 2,282 | ||||||||||||
Depreciation and amortization
|
2,213 | 1,454 | 4,188 | 2,555 | ||||||||||||
Customer support services
|
733 | 672 | 1,504 | 1,250 | ||||||||||||
Sales and marketing
|
1,381 | 1,314 | 2,721 | 2,547 | ||||||||||||
General and administrative
|
2,265 | 1,907 | 4,140 | 3,716 | ||||||||||||
Total Operating Expenses
|
8,438 | 6,554 | 15,905 | 12,350 | ||||||||||||
Operating Loss
|
(1,857 | ) | (1,685 | ) | (3,371 | ) | (3,237 | ) | ||||||||
Other Income (Expense)
|
||||||||||||||||
Gain on business acquisition
|
564 | 356 | 564 | 356 | ||||||||||||
Interest income
|
4 | 1 | 10 | 1 | ||||||||||||
Interest expense
|
(2 | ) | - | (5 | ) | - | ||||||||||
Other income (expense), net
|
(3 | ) | 22 | (4 | ) | 42 | ||||||||||
Total Other Income (Expense)
|
563 | 379 | 565 | 399 | ||||||||||||
Net Loss
|
$ | (1,294 | ) | $ | (1,306 | ) | $ | (2,806 | ) | $ | (2,838 | ) | ||||
Net loss per common share
|
$ | (0.03 | ) | $ | (0.04 | ) | $ | (0.07 | ) | $ | (0.08 | ) | ||||
Weighted average common shares
outstanding – basic and diluted
|
42,639 | 34,915 | 42,426 | 34,792 |
Balance Sheet
|
||||||||
(Unaudited)
June 30,
2011 |
(Audited)
December 31,
2010 |
|||||||
Assets
|
||||||||
Current Assets
|
||||||||
Cash and cash equivalents
|
$ | 16,445 | $ | 23,173 | ||||
Other
|
853 | 856 | ||||||
Total Current Assets
|
17,298 | 24,029 | ||||||
Property and equipment, net
|
20,864 | 15,266 | ||||||
Other assets
|
6,610 | 5,295 | ||||||
Total Assets
|
44,772 | 44,590 | ||||||
Liabilities and Stockholders’ Equity
|
||||||||
Current Liabilities
|
||||||||
Accounts payable and accrued expenses
|
2,932 | 2,506 | ||||||
Deferred revenues and other
|
1,620 | 1,339 | ||||||
Total Current Liabilities
|
4,552 | 3,845 | ||||||
Long-Term Liabilities
|
651 | 724 | ||||||
Total Liabilities
|
5,203 | 4,569 | ||||||
Stockholders’ Equity
|
||||||||
Common stock
|
43 | 42 | ||||||
Additional paid-in-capital
|
77,687 | 75,333 | ||||||
Accumulated deficit
|
(38,161 | ) | (35,354 | ) | ||||
Total Stockholders’ Equity
|
39,569 | 40,021 | ||||||
Total Liabilities and Stockholders’ Equity
|
$ | 44,772 | $ | 44,590 |
Statement of Cash Flows (Unaudited)
|
Six months
ended June 30, |
|||||||
2011
|
2010
|
|||||||
Cash Flows From Operating Activities
|
||||||||
Net loss
|
$ | (2,806 | ) | $ | (2,838 | ) | ||
Non-cash adjustments:
|
||||||||
Depreciation & amortization
|
4,188 | 2,555 | ||||||
Stock-based compensation
|
247 | 458 | ||||||
Gain on business acquisition
|
(564 | ) | (356 | ) | ||||
Other
|
118 | (72 | ) | |||||
Changes in operating assets and liabilities
|
(176 | ) | 59 | |||||
Net Cash Provided By (Used In) Operating Activities
|
1,007 | (50 | ) | |||||
Cash Flows From Investing Activities
|
||||||||
Acquisitions of property and equipment
|
(6,320 | ) | (3,152 | ) | ||||
Acquisition of businesses
|
(1,600 | ) | (1,170 | ) | ||||
Other
|
(42 | ) | (3 | ) | ||||
Net Cash Used In Investing Activities
|
(7,962 | ) | (4,325 | ) | ||||
Cash Flows From Financing Activities
|
||||||||
Repayment of capital leases
|
(40 | ) | - | |||||
Proceeds from stock issuances
|
267 | - | ||||||
Net Cash Provided By Financing Activities
|
227 | - | ||||||
Net Decrease In Cash and Cash Equivalents
|
(6,728 | ) | (4,375 | ) | ||||
Cash and Cash Equivalents – Beginning
|
23,173 | 14,041 | ||||||
Cash and Cash Equivalents – Ending
|
$ | 16,445 | $ | 9,666 |
Market
|
Revenues
|
Cost of
Revenues(1) |
Gross Margin(1)
|
Operating Costs
|
Adjusted
Market
EBITDA
|
|||||||||||||||||||
Boston
|
$ | 1,706 | $ | 399 | $ | 1,307 | 77 | % | $ | 275 | $ | 1,032 | ||||||||||||
New York
|
1,503 | 464 | 1,039 | 69 | % | 324 | 715 | |||||||||||||||||
Los Angeles
|
1,048 | 192 | 856 | 82 | % | 275 | 581 | |||||||||||||||||
Chicago
|
917 | 295 | 622 | 68 | % | 162 | 460 | |||||||||||||||||
San Francisco
|
386 | 73 | 313 | 81 | % | 97 | 216 | |||||||||||||||||
Miami
|
342 | 80 | 262 | 77 | % | 92 | 170 | |||||||||||||||||
Las Vegas-Reno
|
189 | 76 | 113 | 60 | % | 8 | 105 | |||||||||||||||||
Seattle
|
138 | 54 | 84 | 61 | % | 35 | 49 | |||||||||||||||||
Providence-Newport
|
112 | 42 | 70 | 63 | % | 24 | 46 | |||||||||||||||||
Dallas-Fort Worth
|
180 | 79 | 101 | 56 | % | 71 | 30 | |||||||||||||||||
Philadelphia
|
44 | 18 | 26 | 59 | % | 28 | (2 | ) | ||||||||||||||||
Nashville
|
16 | 12 | 4 | 25 | % | 11 | (7 | ) | ||||||||||||||||
Total
|
$ | 6,581 | $ | 1,784 | $ | 4,797 | 73 | % | $ | 1,402 | $ | 3,395 |
Reconciliation of Non-GAAP Financial Measure to GAAP Financial Measure
|
||||
Adjusted market EBITDA
|
$ | 3,395 | ||
Centralized costs (1)
|
(774 | ) | ||
Corporate expenses
|
(2,124 | ) | ||
Depreciation and amortization
|
(2,213 | ) | ||
Stock-based compensation
|
(141 | ) | ||
Other income (expense)
|
563 | |||
Net loss
|
$ | (1,294 | ) |
Market
|
Revenues
|
Cost of
Revenues(1) |
Gross Margin(1)
|
Operating Costs
|
Adjusted
Market
EBITDA
|
|||||||||||||||||||
New York
|
$ | 1,459 | $ | 285 | $ | 1,174 | 80 | % | $ | 353 | $ | 821 | ||||||||||||
Boston
|
1,084 | 171 | 913 | 84 | % | 164 | 749 | |||||||||||||||||
Los Angeles
|
754 | 137 | 617 | 82 | % | 258 | 359 | |||||||||||||||||
Chicago
|
650 | 203 | 447 | 69 | % | 155 | 292 | |||||||||||||||||
San Francisco
|
276 | 61 | 215 | 78 | % | 81 | 134 | |||||||||||||||||
Miami
|
255 | 85 | 170 | 67 | % | 89 | 81 | |||||||||||||||||
Providence-Newport
|
125 | 39 | 86 | 69 | % | 28 | 58 | |||||||||||||||||
Seattle
|
131 | 57 | 74 | 56 | % | 32 | 42 | |||||||||||||||||
Nashville
|
21 | 14 | 7 | 33 | % | 7 | - | |||||||||||||||||
Dallas-Fort Worth
|
113 | 82 | 31 | 27 | % | 62 | (31 | ) | ||||||||||||||||
Philadelphia
|
1 | 13 | (12 | ) | 0 | % | 54 | (66 | ) | |||||||||||||||
Total
|
$ | 4,869 | $ | 1,147 | $ | 3,722 | 76 | % | $ | 1,283 | $ | 2,439 |
Reconciliation of Non-GAAP Financial Measure to GAAP Financial Measure
|
||||
Adjusted market EBITDA
|
$ | 2,439 | ||
Centralized costs (1)
|
(763 | ) | ||
Corporate expenses
|
(1,643 | ) | ||
Depreciation and amortization
|
(1,454 | ) | ||
Stock-based compensation
|
(264 | ) | ||
Other income (expense)
|
379 | |||
Net loss
|
$ | (1,306 | ) |
Market
|
Revenues
|
Cost of
Revenues(1)
|
Gross Margin(1)
|
Operating Costs
|
Adjusted
Market
EBITDA
|
|||||||||||||||||||
Boston
|
$ | 3,359 | $ | 794 | $ | 2,565 | 76 | % | $ | 497 | $ | 2,068 | ||||||||||||
New York
|
2,951 | 804 | 2,147 | 73 | % | 656 | 1,491 | |||||||||||||||||
Los Angeles
|
1,999 | 366 | 1,633 | 82 | % | 537 | 1,096 | |||||||||||||||||
Chicago
|
1,733 | 521 | 1,212 | 70 | % | 348 | 864 | |||||||||||||||||
San Francisco
|
735 | 132 | 603 | 82 | % | 190 | 413 | |||||||||||||||||
Miami
|
643 | 149 | 494 | 77 | % | 195 | 299 | |||||||||||||||||
Las Vegas-Reno
|
189 | 76 | 113 | 60 | % | 8 | 105 | |||||||||||||||||
Seattle
|
274 | 107 | 167 | 61 | % | 63 | 104 | |||||||||||||||||
Providence-Newport
|
231 | 84 | 147 | 64 | % | 50 | 97 | |||||||||||||||||
Dallas-Fort Worth
|
324 | 160 | 164 | 51 | % | 136 | 28 | |||||||||||||||||
Nashville
|
32 | 20 | 12 | 38 | % | 23 | (11 | ) | ||||||||||||||||
Philadelphia
|
64 | 31 | 33 | 52 | % | 56 | (23 | ) | ||||||||||||||||
Total
|
$ | 12,534 | $ | 3,244 | $ | 9,290 | 74 | % | $ | 2,759 | $ | 6,531 |
Reconciliation of Non-GAAP Financial Measure to GAAP Financial Measure
|
||||
Adjusted market EBITDA
|
$ | 6,531 | ||
Centralized costs (1)
|
(1,574 | ) | ||
Corporate expenses
|
(3,893 | ) | ||
Depreciation and amortization
|
(4,188 | ) | ||
Stock-based compensation
|
(247 | ) | ||
Other income (expense)
|
565 | |||
Net loss
|
$ | (2,806 | ) |
Market
|
Revenues
|
Cost of
Revenues(1) |
Gross Margin(1)
|
Operating Costs
|
Adjusted
Market EBITDA |
|||||||||||||||||||
New York
|
$ | 2,853 | $ | 557 | $ | 2,296 | 80 | % | $ | 643 | $ | 1,653 | ||||||||||||
Boston
|
2,136 | 346 | 1,790 | 84 | % | 338 | 1,452 | |||||||||||||||||
Los Angeles
|
1,429 | 270 | 1,159 | 81 | % | 547 | 612 | |||||||||||||||||
Chicago
|
942 | 315 | 627 | 67 | % | 250 | 377 | |||||||||||||||||
San Francisco
|
545 | 118 | 427 | 78 | % | 146 | 281 | |||||||||||||||||
Miami
|
455 | 155 | 300 | 66 | % | 176 | 124 | |||||||||||||||||
Providence-Newport
|
253 | 83 | 170 | 67 | % | 63 | 107 | |||||||||||||||||
Seattle
|
253 | 109 | 144 | 57 | % | 63 | 81 | |||||||||||||||||
Nashville
|
21 | 14 | 7 | 33 | % | 7 | - | |||||||||||||||||
Dallas-Fort Worth
|
225 | 164 | 61 | 27 | % | 116 | (55 | ) | ||||||||||||||||
Philadelphia
|
1 | 28 | (27 | ) | 0 | % | 105 | (132 | ) | |||||||||||||||
Total
|
$ | 9,113 | $ | 2,159 | $ | 6,954 | 76 | % | $ | 2,454 | $ | 4,500 |
Reconciliation of Non-GAAP Financial Measure to GAAP Financial Measure
|
||||
Adjusted market EBITDA
|
$ | 4,500 | ||
Centralized costs (1)
|
(1,466 | ) | ||
Corporate expenses
|
(3,258 | ) | ||
Depreciation and amortization
|
(2,555 | ) | ||
Stock-based compensation
|
(458 | ) | ||
Other income (expense)
|
399 | |||
Net loss
|
$ | (2,838 | ) |
(1)
|
Certain expenses are reported as Cost of Revenues for financial statement purposes but are included in Centralized costs in the Market Data table because they are not specific to any market. These costs totaled $62 and $60 respectively for the three months ended June 30, 2011 and 2010 and $108 and $123 for six months ended June 30, 2011 and 2010.
|