Continued Growth in Revenue, Margins, and Operating Profitability
NOVATO, Calif., Nov. 14 /PRNewswire-FirstCall/ -- GoAmerica, Inc.
(NASDAQ: GOAM), a provider of relay and wireless communications and
professional interpreter services for deaf, hard-of-hearing, and
speech-impaired persons, today announced unaudited results for the
quarter ended September 30, 2008 and the filing of its Quarterly
Report on Form 10-Q with the Securities and Exchange Commission
("SEC"). Total revenue for the three months ended September 30,
2008 was $35.7 million, compared to $4.8 million for the three
months ended September 30, 2007. Total revenue for the nine months
ended September 30, 2008 was $95.4 million, compared to $13.4
million for the nine months ended September 30, 2007. The
year-over-year revenue growth is primarily attributable to the
Company's first quarter purchase of the telecommunications relay
services business of Verizon, its merger with Hands on Video Relay
Services, Inc., its third quarter purchases of Sign Language
Associates (SLA) and Visual Language Interpreting (VLI), as well as
organic growth in the Company's video relay services business.
Income from operations for the three months ended September 30,
2008 was approximately $828,000 compared with a loss from
operations of $851,000 for the three months ended September 30,
2007. Income from operations for the nine months ended September
30, 2008 was approximately $4.2 million, compared with a loss from
operations of $2.3 million for the nine months ended September 30,
2007. Net loss for the three months ended September 30, 2008 was
approximately $1.3 million compared with a net loss of $861,000 for
the three months ended September 30, 2007. Net loss available to
common stockholders, when taking into account the $840,000 of
accrued preferred stock dividends, was $2.2 million, or $0.24 per
common share, for the three months ended September 30, 2008
compared with a net loss $881,000, or $0.39 per common share, for
the three months ended September 30, 2007. Net loss for the nine
months ended September 30, 2008 was approximately $1.0 million
compared with a net loss of $2.4 million for the nine months ended
September 30, 2007. Earnings before interest, taxes, depreciation
and amortization ("EBITDA"), which is a non-GAAP measure, for the
three months ended September 30, 2008 was $5.8 million, when
adjusting for approximately $0.6 million of non-cash employee
compensation charges, $0.7 million of restructuring charges and
$1.7 million of integration costs related to the acquisitions as
measured under the terms of the Company's Credit Agreement. EBITDA,
when taking into account these adjustments, for the nine months
ended September 30, 2008 was $17.6 million. Cash provided from
operations for the nine months ended September 30, 2008 was $7.6
million, principally resulting from income from operations. Capital
expenditures for the nine months ended September 30, 2008 were $3.0
million, used primarily to fund capacity expansion and call center
operations, including telecommunications infrastructure. GoAmerica
had approximately $18.9 million in unrestricted cash and cash
equivalents as well as $0.5 million in restricted cash.
Additionally, the Company has $15.0 million of borrowing capacity
under its revolving line of credit. The Company receives a
significant majority of its payments from federal and state
government agencies and as a result experiences a favorable cash
collection cycle. On July 1, 2008, the Company announced it had
merged with two of the nation's premier sign language interpreting
services firms: Sign Language Associates and Visual Language
Interpreting, both of which are based in the Washington, D.C. metro
area. The SLA and VLI transactions made GoAmerica the nation's
leading provider of on-site sign language interpreting services,
and will provide broader access to Video Remote Interpreting (VRI)
services for its customers. The transactions also expand the
availability of certified, high-quality interpreters and
transcriptionists for the Company's other products and services.
"With the addition of SLA and VLI, we are now bringing together
five operations into one and we are making significant strides,"
said John Ferron, CFO/COO of GoAmerica. "We have redefined our
organizational structure, moved our headquarters to California, and
have filled key positions in the organization as well as focused on
more traditional integration activities. There's more to be
achieved through the balance of the fourth quarter and we expect
full integration to be complete by the end of the first quarter of
2009. During this timeframe, we will remain keenly focused on
operational performance as well as implementing initiatives to
improve our cost structure post-integration." "As part of the
overall integration activities, we have unified our service brands
underneath the umbrella brand Purple(TM) further tying our end to
end service solutions to one brand promise, and an easily
recognizable graphical connection. All of our service brands will
now have elements of Purple in their execution, and will be
supported by the shared slogan "Powered by Purple(TM)." This new
brand platform provides us with reach and flexibility needed to
continue to add to our portfolio of service brands, as we continue
to look for ways to expand our service offerings." said Ed
Routhier, President and Vice-Chairman of GoAmerica. "Strategically
we are in a strong position given our favorable liquidity and the
fact that our three sources of revenue, text relay, video relay and
community interpreting, are non-cyclical and do not heavily rely on
discretionary consumer spending to grow," said Dan Luis, CEO of
GoAmerica. "We continue to invest in our people, infrastructure,
and product development initiatives as we position ourselves for
growth and maintain our standing as the industry's employer of
choice. I am optimistic that our new products and services will
result in enhanced growth opportunities in 2009." About GoAmerica,
Inc. GoAmerica, Inc. is one of the nation's largest providers of
communication services for the deaf, hard of hearing, and
speech-disabled communities. As a leading provider of onsite
interpreting services, video relay and text relay services, and
video remote interpreting, the Company delivers a wide array of
options designed to meet the varied communication needs of its
customers. The Company's vision is to improve the quality of life
of its customers by being their premier provider of high quality,
innovative communication services that break down communications
barriers. 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, Internet Relay by visiting
http://www.i711.com/ or http://www.ip-relay.com/, or video phone by
connecting to hovrs.tv. Safe Harbor The statements contained in
this news release that are not based on historical fact --
including statements regarding the anticipated results of the
transactions described in this press release -- constitute
"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: (i) our ability to integrate the businesses and
technologies we have acquired; (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 generate revenue growth;
(vi) our ability to increase or maintain gross margins,
profitability, liquidity and capital resources; and (vii)
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, "Relay and
Beyond", and "Hands On VRS" are registered trademarks of GoAmerica.
"i711.com", "i711 Wireless", "Mobile Video Phone", and "MVP" are
trademarks and service marks of GoAmerica. Other names may be
trademarks of their respective owners. CONTACTS: John Ferron
GoAmerica CFO and COO 415-408-2340 Laura Kowalcyk CJP
Communications 212-279-3115 x209 GOAMERICA, INC. CONDENSED
CONSOLIDATED BALANCE SHEETS (In thousands) September 30, December
31, 2008 2007 ---- ---- Assets Current assets: Cash and cash
equivalents $18,889 $2,368 Accounts receivable, net 15,005 1,960
Merchandise inventories, net 370 206 Prepaid expenses and other
current assets 1,559 220 ----- --- Total current assets 35,823
4,754 Goodwill 75,473 6,000 Identifiable intangible assets, net
58,162 -- Other assets 9,303 7,544 ----- ----- Total assets
$178,761 $18,298 ======== ======= Liabilities and stockholders'
equity Current liabilities: Accounts payable $3,888 $1,285 Accrued
expenses 11,507 3,623 Deferred revenue -- 94 Loan payable -- 3,532
Current portion of long term debt 400 -- Other current liabilities
132 88 --- -- Total current liabilities 15,927 8,622 Long term debt
less current portion, net of discount of $2,080 at September 30,
2008 67,220 -- Deferred tax liability 12,048 -- Other liabilities
2,780 124 Stockholders' equity 80,786 9,552 ------ ----- $166,713
$18,298 ======== ======= 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, ------------- ------------- 2008 2007 2008 2007
---- ---- ---- ---- Revenues: Relay services $30,644 $4,293 $88,348
$11,787 Interpreting 5,024 -- 6,285 -- Other 67 543 814 1,661 --
--- --- ----- 35,735 4,836 95,447 13,448 Costs and expenses: Cost
of relay services 15,972 2,999 47,607 8,074 Cost of interpreting
3,996 -- 5,235 -- Cost of other 65 444 959 1,393 Sales and
marketing 2,990 612 8,702 1,615 General and administrative 8,721
1,479 20,693 4,092 Research and development 1,068 59 2,479 316
Depreciation and amortization 284 94 714 257 Amortization of
intangible assets 1,811 -- 4,841 -- ----- ---- ----- ---- 34,907
5,687 91,230 15,747 ------ ----- ------ ------ Income (loss) from
operations 828 (851) 4,217 (2,299) Other income (expense):
Settlement losses -- -- -- (162) Gain on interest rate cap
agreement (130) -- 111 -- Interest income (expense), net (1,819)
(10) (5,092) 49 ------- ---- ------- -- Total other income
(expense), net (1,949) (10) (4,981) (113) ------- ---- -------
----- Income (loss) before income taxes (1,121) (861) (764) (2,412)
Income tax provision 202 -- 202 -- --- --- --- --- Net income
(loss) (1,323) (861) (966) (2,412) Preferred dividends (840) (20)
(2,367) (20) ----- ---- ------- ---- Net loss applicable to common
stockholders $(2,163) $(881) $(3,333) $(2,432) ======== ======
======== ======== Loss per common share: Basic $(0.24) $(0.39)
$(0.36) $(1.10) ======= ======= ======= ======= Diluted $(0.24)
$(0.39) $(0.36) $(1.10) ======= ======= ======= ======= Weighted
average shares outstanding Basic and Diluted 9,159,452 2,239,966
9,154,637 2,216,349 DATASOURCE: GoAmerica, Inc. CONTACT: John
Ferron CFO and COO of GoAmerica, +1-415-408-2340, ; or Laura
Kowalcyk of CJP Communications for GoAmerica, +1-212-279-3115 x209,
Web Site: http://www.goamerica.com/ http://www.i711.com/
http://www.ip-relay.com/
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