HACKENSACK, N.J., May 15 -- GoAmerica, Inc. (Nasdaq: GOAM), a provider of relay and wireless communications services for deaf, hard-of-hearing, and speech-impaired persons, today announced results for the first quarter ended March 31, 2007.
First 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 March 31, 2007 increased to approximately $4.3 million, compared to total revenue in the previous quarter of approximately $4.2 million; and an increase of 163% compared to total revenue of approximately $1.6 million in the first quarter of 2006.
The change in year over year revenue comparisons resulted from a combination of two factors: the Company's mid-2006 certification by the Federal Communications Commission (FCC), which enabled GoAmerica to recognize the full revenues associated with its relay services, and continued growth in the Company's i711® relay and wireless divisions.
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 from continuing operations for the first quarter was approximately $765,000 or $0.35 per diluted common share, compared with a net loss from continuing operations, exclusive of income tax benefits, of $765,000, or $0.36 per diluted common share in the previous quarter. Included in the net loss from continuing operations for the first quarter was $162,000 settlement loss related to the settlement of the Hands On litigation described below. The net loss from continuing operations for the first quarter of 2006 was approximately $1 million, or $0.46 per diluted common share during the first quarter of 2006.
Also included in the loss from continuing operations for the quarters ended March 31, 2007 and December 31, 2006 were non-cash charges of $301,000 and $275,000 respectively, reflecting depreciation, amortization, and non-cash employee compensation charges for those periods. The first quarter net loss for 2006 includes a $119,000 loss attributable to discontinued operations while the fourth quarter net loss for 2006 includes a $18,000 loss attributable to discontinued operations.
As of March 31, 2007, GoAmerica had approximately $3.4 million in cash and cash equivalents, compared to $3.9 million as of December 31, 2006.
"With the addition of video relay services in December 2006, our product portfolio is very strong. While we continue to develop and enhance our products, we are not satisfied with the pace of our revenue growth and are taking steps to address it," said Dan Luis, chief executive officer of GoAmerica. "Among other things, we are broadening our distribution channels to further introduce our products and services to the marketplace. We are also expanding access to our i711 VRS platform through other prevalent technologies, such as D-Link and other videophones, while endeavoring to maintain the superior picture quality that i711 VRS provides on Windows XP-and now Vista-equipped PCs."
GoAmerica filed its Quarterly Report on Form 10-Q for the period ended March 31, 2007 earlier today.
Summary of Recent Developments
-- Vista Compatibility. The Company added compatibility with Microsoft
Vista to its i711 VRS software, ensuring that users of the newest
Windows operating system can use their PCs to access i711 VRS.
-- D-Link Preview. The Company began a preview period of the videophone
version of its VRS service, enabling users of D-Link i2eye, VP-100 and
VP-200 videophones to use i711 VRS directly from a television.
-- Hands On Litigation Settlement. The Company settled its litigation with
Hands On for an immediate $400,000 cash payment, a mutual release of
all claims relating to the terminated merger between Hands On and the
Company, and other consideration.
About GoAmerica
GoAmerica provides a wide range of wireless and relay communications services, customized for people who are deaf, hard-of-hearing or speech impaired. The Company's vision is to improve the quality of life of its customers by being their premier provider of innovative communication services. For more information on the Company or its services, visit http://www.goamerica.com or contact GoAmerica directly at TTY 201-527-1520, voice 201-996-1717 or via Internet Relay by visiting http://www.i711.com.
Safe Harbor
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)
March 31, December 31,
2007 2006
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $3,388 $3,870
Accounts receivable, net 1,754 1,891
Other receivables, net 448 48
Merchandise inventories, net 279 329
Prepaid expenses and other current assets 252 185
Total current assets 6,121 6,323
Other assets 7,039 7,556
Total assets $13,160 $13,879
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $404 $559
Accrued expenses 1,970 1,982
Deferred revenue 106 100
Other current liabilities 72 65
Total current liabilities 2,552 2,706
Other liabilities 84 112
Stockholders' equity 10,524 11,061
$13,160 $13,879
GOAMERICA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended March 31,
2007 2006
Revenues:
Relay services $3,660 $467
Subscriber 316 290
Commissions 187 827
Equipment 106 50
Other 38 2
4,307 1,636
Costs and expenses:
Cost of relay services 2,405 45
Cost of subscriber airtime 310 139
Cost of equipment revenue 134 80
Cost of network operations 29 27
Sales and marketing 524 542
General and administrative 1,356 1,111
Research and development 114 133
Depreciation and amortization 73 144
4,945 2,221
Loss from operations (638) (585)
Other income (expense):
Settlement loss (162) --
Terminated merger costs -- (419)
Interest income (expense), net 35 45
Total other income (expense), net (127) (374)
Loss from continuing operations (765) (959)
Loss from discontinued operations -- (119)
Net loss $(765) $(1,078)
Loss per share-Basic and Diluted:
Loss from continuing operations $(0.35) $(0.46)
Loss from discontinued operations -- (0.05)
Basic and Diluted net loss per share $(0.35) $(0.51)
Weighted average shares used in computation
of basic and diluted net loss per share 2,185,458 2,093,451
