HACKENSACK, N.J., Nov. 8 -- GoAmerica, Inc. (Nasdaq: GOAM), a leading provider of online and wireless relay services, today announced results for the third quarter ended September 30, 2006.
Third quarter results and comparisons to prior periods are presented reflecting the Company's prepaid calling card division as a discontinued operation. This sale was completed on October 2, 2006.
Total revenue for the three months ended September 30, 2006 increased by 93% to approximately $4.6 million, compared to total revenue in the previous quarter of approximately $2.4 million; and an increase of 259% compared to total revenue of approximately $1.3 million in the third quarter of 2005.
Third quarter revenue growth resulted from a combination of two factors: continued growth in the Company's i711® relay and wireless divisions, and the Company's recent certification by the Federal Communications Commission (FCC), which enabled GoAmerica to fully recognize revenues associated with its relay services.
Prior to becoming certified, GoAmerica recognized only a portion of the revenue it generated through its i711 relay service because it was submitting minutes for payment through its business partner, Nordia, Inc. Nordia, which is also a certified relay provider, would submit i711 relay service minutes to the Interstate Telecommunications Relay Service (TRS) Fund on GoAmerica's behalf. Under this arrangement, Nordia received the reimbursement and paid GoAmerica its share of the revenue.
Net loss for the third quarter was approximately $522,000 or $0.22 per diluted common share, compared with a net loss of $366,000, or $0.16 per diluted common share in the previous quarter, and a net loss of approximately $1.0 million, or $0.48 per diluted common share during the third quarter of 2005.
The third quarter net loss includes a $371,000 loss attributable to discontinued operations. The loss from continuing operations was $151,000 for the third quarter of 2006, compared to $285,000 for the previous quarter and $653,000 for the third quarter of 2005.
Earnings before interest, taxes, depreciation and amortization (EBITDA) was a loss of $93,000 in the third quarter of 2006, compared with a loss of $197,000 in the prior quarter, and a loss of $441,000 in the third quarter of 2005. Included in the EBITDA loss for the quarters ended September 30, 2006 and June 30, 2006 were $108,000 and $106,000 of non-cash employee compensation, respectively.
As of September 30, 2006, GoAmerica had approximately $3.6 million in cash and cash equivalents, compared to $3.9 million as of June 30, 2006.
"During 2006 our financial results have continued to improve and we are optimistic about further improvements associated with the release of new services slated for the fourth quarter and beyond," said Dan Luis, CEO of GoAmerica.
GoAmerica filed its Quarterly Report on Form 10-Q for the period ended September 30, 2006 earlier today.
GoAmerica also announced today that its annual stockholders meeting for the election of directors will be held on December 21, 2006 at 10:00 a.m. at 411 Hackensack Avenue, Hackensack, New Jersey. The close of business on November 10, 2006 has been established by GoAmerica as the record date for determination of GoAmerica stockholders entitled to receive notice of and vote at the GoAmerica annual stockholders meeting. A proxy statement, together with GoAmerica's Annual Report on Form 10-K, will be mailed to stockholders of record prior to the annual meeting.
Summary of Recent Developments
-- Former Qualcomm Executive Joins Board of Directors - On September 12,
2006, GoAmerica announced that it appointed Jan Dehesh, a former
executive at Qualcomm, to its Board of Directors.
-- Completes Sale of Prepaid Calling Card Business - On October 4, 2006,
GoAmerica announced that it completed the sale of its prepaid calling
card operations to Next Carrier Telecom, Inc, a New York based provider
of telecommunications services.
About GoAmerica
The statements contained in this news release that are not based on historical fact are "forward-looking statements" that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology such as "may," "will," "expect," "estimate," "anticipate," "continue," or similar terms, variations of such terms or the negative of those terms. Such forward-looking statements involve risks and uncertainties, including, but not limited to those of GoAmerica including: (i) our limited operating history; (ii) our ability to respond to the rapid technological change of the wireless data industry and offer new services; (iii) our dependence on wireless carrier networks; (iv) our ability to respond to increased competition in the wireless data industry; (v) our ability to integrate acquired businesses and technologies; (vi) our ability to generate revenue growth; (vii) our ability to increase or maintain gross margins, profitability, liquidity and capital resources; and (viii) difficulties inherent in predicting the outcome of regulatory processes. Such risks and others are more fully described in the Risk Factors set forth in our filings with the Securities and Exchange Commission. Our actual results could differ materially from the results expressed in, or implied by, such forward-looking statements. GoAmerica is not obligated to update and does not undertake to update any of its forward looking statements made in this press release. Each reference in this news release to "GoAmerica", the "Company" or "We", or any variation thereof, is a reference to GoAmerica, Inc. and its subsidiaries. "GoAmerica", the "GoAmerica" logo, "i711", and the "i711.com" logo are registered trademarks of GoAmerica. "i711.com", "i711 Wireless", "ClickRelay", "Relay and Beyond", and "Clear Mobile" are trademarks and service marks of GoAmerica. Other names may be trademarks of their respective owners.
GOAMERICA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 30, December 31,
2006 2005
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $3,646 $4,804
Accounts receivable, net 1,733 931
Merchandise inventories, net 412 161
Prepaid expenses and other current assets 708 110
Assets of discontinued operations 147 378
Total current assets 6,646 6,384
Other assets 6,682 7,691
Total assets $13,328 $14,075
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $1,043 $765
Accrued expenses 1,103 554
Deferred revenue 89 66
Other current liabilities 62 19
Liabilities of discontinued operations 92 173
Total current liabilities 2,389 1,577
Other liabilities 86 --
Stockholders' equity 10,853 12,498
$13,328 $14,075
GOAMERICA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2006 2005 2006 2005
Revenues:
Subscriber $328 $548 $934 $1,967
Relay services 3,497 329 5,325 774
Commissions 559 255 2,045 549
Equipment 165 120 266 297
Other 2 15 5 127
4,551 1,267 8,575 3,714
Costs and expenses:
Cost of subscriber airtime 265 208 569 727
Cost of equipment revenue 178 138 380 382
Cost of network operations 27 35 81 152
Cost of relay services 2,342 -- 3,034 --
Sales and marketing 689 320 1,709 773
General and administrative 1,105 911 3,267 2,973
Research and development 38 96 271 255
Depreciation and amortization 104 119 374 375
Amortization of other
intangibles -- 122 -- 564
4,748 1,949 9,685 6,201
Loss from operations (197) (682) (1,110) (2,487)
Other income (expense):
Terminated merger costs -- -- (431) --
Interest income (expense), net 46 29 146 105
Total other income (expense), net 46 29 (285) 105
Loss from continuing
operations (151) (653) (1,395) (2,382)
Loss from discontinued
operations (371) (341) (571) (655)
Net loss $(522) $(994) $(1,966) $(3,037)
Loss per share-Basic and Diluted:
Loss from continuing
operations $(0.07) $(0.32) $(0.60) $(1.14)
Loss from discontinued
operations (0.15) (0.16) (0.24) (0.31)
Basic and Diluted net loss
per share $(0.22) $(0.48) $(0.84) $(1.45)
Weighted average shares used
in computation of basic and
diluted net loss per share 2,338,451 2,093,451 2,338,451 2,093,445
GOAMERICA, INC.
RECONCILIATION OF LOSS FROM CONTINUING OPERATIONS TO ADJUSTED EBITDA
(In thousands)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2006 2005 2006 2005
Loss from continuing
operations (151) (653) (1,395) (2,382)
Adjustments:
Total other (income) expense,
net (46) (29) 285 (105)
Depreciation and amortization 104 119 374 375
Amortization of other
intangibles -- 122 -- 564
Adjusted EBITDA $(93) $(441) $(736) $(1,548)
