pdvWireless Reports Fourth Quarter and Year End Results
6/09/15
WOODLAND PARK, NJ -- (
The Company is currently in the process of deploying its advanced digital dispatch networks in major metropolitan markets in
Revenue for the quarter was
Revenue for FY 2015 was
The decline in revenue for the three and twelve month periods is principally a result of decreases in the Company's lower margin international business and higher customer churn in its domestic SAAS business. The U.S. business has been the Company's primary focus over the last several years, during which time it has significantly expanded the functionality of its solutions, much of which is included in the Company's new DispatchPlus service offering.
The Company recently received notification from its international carrier that it would stop offering the Company's service during the first quarter of FY 2016.
The increase in general and administrative expenses for the quarter and the year is primarily attributable to stock compensation expense associated with grants of restricted stock units and stock options issued during the 2015 fiscal year primarily due to the actions approved by the Board of Directors in connection with the Company's
Adjusted EBITDA for the quarter was a negative (
The Company also announced the upcoming commercial launch of its first "DispatchPlus" two-way radio service in
"Overall, our fiscal year ended
Strong Cash Position
The Company has a strong cash position, with
The Company plans to use this cash to pursue its regulatory initiatives, including purchasing additional spectrum, and to deploy dedicated dispatch networks in 20 major metropolitan markets throughout the U.S.
CORPORATE HIGHLIGHTS
- The Company assembled a management team of telecommunications industry veterans focused on building the nation's most business-centric, value-oriented wireless communications solutions provider.
- In
June 2014 , the Company completed a private placement financing in which the Company raised net proceeds of approximately$202.0 million . - In
September 2014 , the Company secured the necessary FCC approvals and completed its acquisition of spectrum fromSprint Corporation for$100 million , including$90 million in cash and$10 million in shares of its common stock. - In
September 2014 , the Company entered into an agreement withMotorola Solutions, Inc. in which Motorola agreed to lease a portion of the Company's spectrum in exchange for an upfront, fully paid leasing fee of$7.5 million and a$10 million investment in a subsidiary of the Company. - In
October 2014 , the Company's President and Chief Executive Officer,John Pescatore , became a member of the board of directors of theEnterprise Wireless Alliance and the Company attended its leadership summit as the first step in raising its profile in the wireless industry. - In
October 2014 , the Company began the process of building out its dispatch network. - In
November 2014 , the Company and theEnterprise Wireless Alliance filed a Joint Petition for Rulemaking with the FCC proposing a realignment of a portion of the 900MHz spectrum from narrowband to broadband. The petition was placed on Public Notice by the FCC and comments and reply comments were received in January of 2015. - In
February 2015 , the Company became a public reporting company and listed its common stock for trading on TheNASDAQ Capital Market under the symbol "PDVW." - In
March 2015 , the Company participated in an ex-parte meeting with the FCC to discuss its responses to the questions raised by the FCC and by third parties through the public comment process. - In late
March 2015 , the Company commenced beta testing of its dispatch network in its first market. The Company plans to deploy its networks in 20 major metropolitan markets over the next eighteen months. - In
May 2015 , the Company and theEnterprise Wireless Alliance filed proposed rules with the FCC related to its Joint Petition for Rulemaking, which outline recommended procedural and technical operating parameters and processes related to the administration and sequence of the proposed realignment of the 900 MHz band. The proposed rules were placed on Public Notice by the FCC for comments throughJune 29, 2015 with reply comments due onJuly 14, 2015 . - In
May 2015 , the Company completed a registered follow-on public offering of common stock resulting in the sale of 1,725,000 shares at a purchase price of$40.00 per share, which includes 225,000 shares sold pursuant to the underwriters' exercise of their over-allotment option. Net proceeds were approximately$64.8 million after deducting underwriting discounts and commissions, and estimated offering expenses.
Conference Call
pdvWireless will host a conference call to discuss its fourth quarter 2015 financial results on
About
Non-GAAP Financial Information
This press release and the information contained herein present a non-GAAP financial measure, Adjusted EBITDA, which excludes certain amounts. The Company defines Adjusted EBITDA as net income (loss) with adjustments for depreciation and amortization, interest income (expense)-net, income taxes and stock-based compensation. The Company has included below unaudited adjusted financial information for the three and twelve months ended
Forward-Looking Statements
Any statements contained in this press release that do not describe historical facts are forward-looking statements (as defined under Federal securities laws). Forward-looking statements generally are accompanied by words such as "will," "expect," "intend," "plan," "outlook" or other similar words, phrases or expressions. These forward-looking statements include statements regarding the planned timing and scope of the deployment of our dispatch network, the estimated costs of deploying our dispatch network and our regulatory initiatives and plans. Any forward-looking statements contained herein are based on our current expectations, but are subject to a number of risks and uncertainties that could cause our actual future results to differ materially from our current expectations or implied by any forward-looking statements. These risks and uncertainties include, but are not limited to: we have no operating history with respect to our proposed push-to-talk business; we have had net losses each year since our inception and may not achieve or maintain profitability in the future; we may experience delays in launching our nationwide network; customers may not adopt our technology; any efforts we pursue to increase the value of our spectrum may not be successful, including our Joint Petition for Rulemaking and our proposed rules to realign the 900 MHz band; we will rely on the equipment and selling efforts of other parties, such as indirect dealers; the wireless communication industry is highly competitive and we may not compete successfully; and government regulation could adversely affect our business and prospects. These and other factors that may affect our future results or operations are identified and described in more detail in our filings with the
Pacific DataVision, Inc. | ||||||||||||||||||
Statements of Operations | ||||||||||||||||||
For three months ended March 31, |
For year ended March 31, |
|||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||||
Operating revenues | ||||||||||||||||||
Service revenue | $ | 633,209 | $ | 908,421 | $ | 2,776,916 | $ | 3,539,595 | ||||||||||
Spectrum lease revenue | 182,186 | - | 394,737 | - | ||||||||||||||
Total operating revenue | 815,395 | 908,421 | 3,171,653 | 3,539,595 | ||||||||||||||
Cost of revenue | ||||||||||||||||||
Service | 272,489 | 300,774 | 1,063,176 | 1,124,121 | ||||||||||||||
Gross profit | 542,906 | 607,647 | 2,108,477 | 2,415,474 | ||||||||||||||
Operating expenses | ||||||||||||||||||
General and administrative | 5,131,578 | 254,461 | 13,362,242 | 925,636 | ||||||||||||||
Sales and support | 644,915 | 318,478 | 1,812,524 | 1,382,024 | ||||||||||||||
Product development | 321,313 | 237,359 | 1,000,890 | 934,818 | ||||||||||||||
Depreciation and amortization | 41,615 | 14,117 | 96,141 | 59,469 | ||||||||||||||
Total operating expenses | 6,139,421 | 824,415 | 16,271,797 | 3,301,947 | ||||||||||||||
Loss from operations | (5,596,515 | ) | (216,768 | ) | (14,163,320 | ) | (886,473 | ) | ||||||||||
Interest expense - affiliated entities | - | (88,516 | ) | (570,737 | ) | (325,348 | ) | |||||||||||
Interest income | 14,962 | - | 19,889 | - | ||||||||||||||
Net loss | $ | (5,581,553 | ) | $ | (305,284 | ) | $ | (14,714,168 | ) | $ | (1,211,821 | ) | ||||||
Net loss per common share basic and diluted | $ | (0.44 | ) | $ | (2.41 | ) | $ | (1.46 | ) | $ | (9.56 | ) | ||||||
Weighted-average common shares used to compute basic and diluted net loss per share | 12,642,365 | 126,759 | 10,048,210 | 126,759 | ||||||||||||||
The table below reconciles Adjusted EBITDA to the Company's GAAP disclosure of net loss: | ||||||||||||||||||
For three months ended | For year ended | |||||||||||||||||
March 31, | March 31, | |||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||
Adjusted EBITDA: | ||||||||||||||||||
Net loss | $ | (5,581,553 | ) | $ | (305,284 | ) | $ | (14,714,168 | ) | $ | (1,211,821 | ) | ||||||
Interest expense - affiliated entities | - | 88,516 | 570,737 | 325,348 | ||||||||||||||
Depreciation and amortization | 41,615 | 14,117 | 96,141 | 59,469 | ||||||||||||||
Stock compensation expense | 2,282,980 | 19,765 | 6,963,782 | 79,057 | ||||||||||||||
Adjusted EBITDA | $ | (3,256,958 | ) | $ | (182,886 | ) | $ | (7,083,508 | ) | $ | (747,947 | ) | ||||||
Pacific DataVision, Inc. | |||||||||
Balance Sheets | |||||||||
At March 31: | 2015 | 2014 | |||||||
ASSETS | |||||||||
Current Assets | |||||||||
Cash and cash equivalents | $ | 119,873,668 | $ | 45,679 | |||||
Accounts receivable, net of allowance for doubtful accounts of $7,977 and $12,619 | 395,172 | 369,408 | |||||||
Prepaid expenses and other current assets | 629,790 | 22,046 | |||||||
Total current assets | 120,898,630 | 437,133 | |||||||
Furniture, fixture and equipment, net | 6,384,602 | 99,548 | |||||||
Intangible assets | 100,298,444 | - | |||||||
Capitalized patent costs, net | 220,783 | 252,747 | |||||||
Other assets | 25,630 | 13,763 | |||||||
Total assets | $ | 227,828,089 | $ | 803,191 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIENCY) | |||||||||
Current liabilities | |||||||||
Accounts payable and accrued expenses | $ | 6,467,285 | $ | 244,230 | |||||
Accounts payable - officers | 40,668 | 117,961 | |||||||
Deferred revenue | 737,664 | 10,751 | |||||||
Total current liabilities | 7,245,617 | 372,942 | |||||||
Noncurrent liabilities | |||||||||
Deferred revenue | 6,376,518 | - | |||||||
Accrued interest expense - affiliated entities | - | 870,247 | |||||||
Deferred compensation | - | 361,610 | |||||||
Notes payable - affiliated entities | - | 3,405,808 | |||||||
Total liabilities | 13,622,135 | 5,010,607 | |||||||
Commitments and contingencies | |||||||||
Stockholders' equity/(deficiency) | |||||||||
Preferred stock, par value, $0.0001 per share, 10,000,000 shares authorized and no shares outstanding at March 31, 2015 and no par value, 8% non-cumulative dividend, 40,000,000 shares authorized, 748,722 shares outstanding at March 31, 2014 | - | 20,525,999 | |||||||
Common stock, par value, $0.0001 per share, 100,000,000 shares authorized and 12,530,493 shares issued and outstanding at March 31, 2015 and no par value, 85,000,000 shares authorized, 126,759 shares issued and outstanding at March 31, 2014 | 1,253 | 12 | |||||||
Additional paid-in capital | 255,861,880 | 2,209,584 | |||||||
Accumulated deficit | (41,657,179 | ) | (26,943,011 | ) | |||||
Total stockholders' equity/(deficiency) | 214,205,954 | (4,207,416 | ) | ||||||
Total liabilities and stockholders' equity/(deficiency) | $ | 227,828,089 | $ | 803,191 | |||||
Pacific DataVision, Inc. | ||||||||||
Statements of Cash Flows | ||||||||||
For the year ended March 31, | 2015 | 2014 | ||||||||
CASH FLOWS FROM OPERATING ACTIVITES | ||||||||||
Net loss | $ | (14,714,168 | ) | $ | (1,211,821 | ) | ||||
Adjustments to reconcile net loss to net cash provided from (used) by operating activities | ||||||||||
Depreciation and amortization | 96,141 | 59,469 | ||||||||
Non-cash compensation expense attributable to stock awards | 6,963,782 | 79,057 | ||||||||
Changes in operating assets and liabilities | ||||||||||
Accounts receivable | (25,764 | ) | (80,405 | ) | ||||||
Prepaid expenses and other assets | (619,611 | ) | (324 | ) | ||||||
Accounts payable and accrued expenses | 6,222,853 | 2,344 | ||||||||
Accounts payable - officers | (77,293 | ) | 16,270 | |||||||
Accrued interest expense | (332,323 | ) | 325,348 | |||||||
Deferred compensation | (361,610 | ) | 24,340 | |||||||
Deferred revenue | 7,103,431 | - | ||||||||
Net Cash flows provided from (used) by operating activities | 4,255,438 | (785,722 | ) | |||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||
Purchases of intangible assets | (90,298,444 | ) | - | |||||||
Purchases of equipment | (6,346,586 | ) | (33,572 | ) | ||||||
Payments for patent costs | (2,644 | ) | (35,456 | ) | ||||||
Net Cash used by investing activities | (96,647,674 | ) | (69,028 | ) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||
Proceeds from notes payable | 45,000 | 705,491 | ||||||||
Net proceeds from Section 144A offering | 201,922,458 | - | ||||||||
Payment of notes payable | (1,133,851 | ) | - | |||||||
Proceeds from Motorola investment | 10,000,000 | - | ||||||||
Net proceeds for January 2015 stock issuance | 1,386,618 | - | ||||||||
Net Cash provided from financing activities | 212,220,225 | 705,491 | ||||||||
Net change in cash and cash equivalents | 119,827,989 | (149,259 | ) | |||||||
CASH AND CASH EQUIVALENTS | ||||||||||
Beginning of the year | 45,679 | 194,938 | ||||||||
End of of the year | $ | 119,873,668 | $ | 45,679 | ||||||
Investor Relations Contacts:
CFO
973-771-0981
Email Contact
Principal
Adam Friedman Associates
917-675-6250
Email Contact
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