pdvWireless Reports First Quarter Results

WOODLAND PARK, N.J., Aug. 9, 2016 /PRNewswire/ -- pdvWireless, Inc., (NASDAQ: PDVW) (the "Company" or "pdvWireless"), a private wireless communications carrier and provider of mobile workforce management solutions, reported today its first fiscal quarter results for the period ended June 30, 2016.

"During the first quarter, we remained focused on our primary business initiatives, including actively promoting our DispatchPlus business, pursuing our rulemaking petition at the FCC and advancing our longer-term strategic initiatives," said John C. Pescatore, President and CEO of pdvWireless. "We continue to receive positive feedback from our initial customers within the business verticals we are targeting."

The Company also made progress with its Joint Petition for Rulemaking. Over the last several months, the pdvWireless team, along with representatives of the Enterprise Wireless Alliance, held productive meetings with the FCC Chairman's office, as well as with the offices of the other four FCC Commissioners, and with representatives of the FCC's Wireless Telecommunications Bureau and the Office of Engineering and Technology. At these meetings, the team discussed the merits of the Petition, which seeks realignment of the 900 MHz band to allow the deployment of broadband technologies. The Company also continued to participate in discussions with several licensees in the band to address their questions and provide solutions.

As announced previously, pdvWireless, together with its consortium partners, submitted a proposal to the FirstNet RFP and continues to work through the official bidding process. "We are excited to participate in the FirstNet RFP process and work with the experienced partners we have in our consortium, who have demonstrated expertise in the critical areas needed to build and operate a nationwide public-safety broadband network," added Mr. Pescatore. "There are numerous benefits to participating in this FirstNet process, and our company is strengthened as a result."

Financial Results

Revenue for the Company's first fiscal quarter ended June 30, 2016 was $1.0 million compared with $0.8 million for the quarter ended June 30, 2015. For the first quarter of this year, the Company reported a net loss of ($10.1 million), or ($0.70) per share, compared with a net loss of ($4.4 million), or ($0.32) per share, for the same quarter in the previous year. 

Due to the early phase of its DispatchPlus business, the Company's revenues for the three months ended June 30, 2016 continued to principally represent its historical software as-a-service ("SaaS") business, although the increases in revenues for the quarter were primarily from the recently launched DispatchPlus business. 

The operating results for the three months ended June 30, 2016 also include costs and expenses related to developing the Company's broadband spectrum strategies, including the FirstNet bid, and operating, selling and marketing costs of implementing and deploying its DispatchPlus business.

Cost of revenue for the three months ended June 30, 2016 increased by 322.1% to $1.6 million from $0.4 million for the three months ended June 30, 2015. The increase primarily reflects the costs to maintain and operate the Company's push-to-talk networks for its DispatchPlus business.

Operating expenses for the three months ended June 30, 2016 increased by $4.7 million, or 97%, to $9.5 million from $4.8 million for the three months ended June 30, 2015. The increase for the first quarter was principally driven by: 

• General and administrative expenses increased by $4.0 million, or 108%, to $7.7 million from $3.7 million. The increase largely resulted from $3.3 million for consulting services related to the Company's strategic initiatives, including the FirstNet RFP process, and $0.5 million for increased headcount and related costs.
• Sales and support increased by $0.4 million, or 50%, to $1.2 million for the three months ended June 30, 2016 from $0.8 million for the three months ended June 30, 2015. The increase is due primarily to a $0.2 million increase in headcount and related costs along with $0.1 million for indirect commissions provided to the Company's third-party sales representatives to support its DispatchPlus business.

Adjusted EBITDA for this year's first quarter was a negative ($8.2 million) as compared with a negative ($3.0 million) for the same quarter in the prior year. The decrease in Adjusted EBITDA in the first quarter resulted from higher cost of revenue, selling and general and administrative costs as the Company increased its spending and headcount to support and implement its business initiatives.

Strong Cash Position

The Company has a strong cash position, with $143.2 million in available cash as of June 30, 2016, a decrease of $10.3 million from March 31, 2016 as the Company invested in the pursuit and development of its spectrum strategies.

Conference Call

The Company will host a conference call at 4:45 p.m. EDT today, August 9, 2016, to discuss its first quarter fiscal 2017 financial results and update investors on its other strategic initiatives. Investors in the United States can participate in the earnings call by dialing into the conference line at 888-267-2845 or 973-528-0008 and using the conference code 692207. The earnings call will also be available for replay until August 23, 2016 and can be accessed by dialing into the conference lines at 800-332-6854 or 973-528-0005 and using the conference code 692207. The replay will also be posted on the Company's website at www.pdvwireless.com/investors.

About pdvWireless

pdvWireless, Inc. is a private wireless communications carrier and provider of mobile workforce management solutions that increase the productivity of field-based workers and the efficiency of their dispatch and call center operations. pdvWireless has commenced launching private push-to-talk networks in major markets throughout the United States. Its patented and industry-validated SaaS technology improves team communication and field documentation across a wide array of industries, including transportation, distribution, construction, hospitality, waste management and field service.

pdvWireless' Chairman, Brian McAuley and Vice Chairman, Morgan O'Brien, were the co-founders of Nextel Communications and have over 60 years of combined experience in two-way radio operations and FCC regulatory matters. pdvWireless is headquartered in Woodland Park, New Jersey.

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, other income (expense)-net, income taxes and stock-based compensation. The Company has included below a reconciliation of net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA. The Company's management uses Adjusted EBITDA to evaluate the Company's performance and provides this financial measure to investors as a supplement to the Company's reported results because management believes this information provides additional insight into the Company's operating performance by disregarding certain nonrecurring or non-cash items or items that are not reflective of the day-to-day offering of its services. Adjusted EBITDA should not be considered in isolation, as a substitute for, or as superior to, financial measures calculated in accordance with GAAP, and the Company's financial results calculated in accordance with GAAP and any reconciliation to those financial statements should be carefully evaluated. The non-GAAP financial measure used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

Forward-Looking Statements

Any statements contained in this press release that do not describe historical facts are forward-looking statements as defined under the Federal securities laws. These forward-looking statements include statements regarding the Company's DispatchPlus business and its sales and marketing initiatives, the regulatory status and timing of the Company's Joint Petition for Rulemaking and the Company's spectrum and other initiatives and opportunities. Any forward-looking statements contained herein are based on the Company's current expectations, but are subject to a number of risks and uncertainties that could cause its actual future results to differ materially from its current expectations or those implied by the forward-looking statements. These risks and uncertainties include, but are not limited to: the Company has a limited operating history with respect to its recently launched DispatchPlus business; the Company has had net losses each year since its inception and may not achieve or maintain profitability in the future; the Company's indirect sales model may not be successful; customers may not adopt the Company's technology or service offerings as quickly as anticipated or in sufficient numbers; the Company's spectrum and other initiatives and opportunities, including its Joint Petition for Rulemaking and its FirstNet bid proposal, may not be successful on a timely basis or at all, may cost more than anticipated, and may continue to require significant time and attention from its senior management team and the expenditure of significant resources; the wireless communication industry is highly competitive and the Company may not be able to compete successfully; and government regulation could adversely affect the Company's business and prospects. These and other factors that may affect the Company's future results or operations are identified and described in more detail in its filings with the Securities and Exchange Commission (the "SEC"), including its Annual Report on Form 10-K for the fiscal year ended March 31, 2016, filed with the SEC on June 13, 2016 and its quarterly report on Form 10-Q for the quarter ended June 30, 2016, filed with the SEC on August 9, 2016. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as required by applicable law, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results, later events or circumstances or to reflect the occurrence of unanticipated events.

 

 

 

 

The table below reconciles Adjusted EBITDA to the Company's GAAP disclosure of net loss.

 

 

 

 

 

 

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SOURCE pdvWireless, Inc.