Multiband Announces Fourth Quarter and Full Year 2012 Results

Record 2012 full year revenues of $305.6 million

Q4 of 2012 generated an operating profit of $2.8 million; net income was $2.6 million

Adjusted EBITDA for 4Q of 2012 was $4.8 million

Adjusted EBITDA for 2012 was $18.0 million

Net Income was $0.10 per basic and fully diluted share

01 Apr, 2013, 16:01 ET from Multiband Corporation

MINNEAPOLIS, April 1, 2013 /PRNewswire/ -- Multiband Corporation, (NASDAQ: MBND), a leading Home Service Provider (HSP) for DIRECTV and the nation's largest DIRECTV Master System Operator (MSO) for Multiple Dwelling Units (MDUs), today announced financial results for the fourth quarter and year ended December 31, 2012.

Fourth Quarter and Full Year 2012 Highlights

  • Full year 2012 revenues increased by 1.8% to $305.6 million in spite of a $20.5 million reduction in HSP revenue from DIRECTV. All other revenue streams showed substantial growth from 2011 to 2012.
  • Q4 2012 Adjusted EBITDA was $4.8 million.
  • Full Year 2012 Adjusted EBITDA was $18.0 million.
  • Net income attributable to common stockholders was $2.6 million for the year ($0.10 per basic and fully diluted share)

James L. Mandel, CEO of Multiband, commented, "Throughout 2012, we continued to execute our diversification initiatives designed to expand our platform and footprint, and while the replacement revenues have not been as profitable as that from our traditional businesses,  we made significant headway in leveraging our overall operations. The acquisitions we made and integrated in 2011 and 2012 should improve in profitability in 2013 as a result of the expected elimination of operating losses in the cable fulfillment business as well as improved operations in the EE&C segment as demand for products and services provided in this sector increases and we increase our sales activities and footprint. We are confident that these new sources of revenue will contribute to top and bottom line results in 2013 along with our organic sources of revenue and profitability. DIRECTV has given us visibility into our HSP workflow for 2013 and that will continue to provide us with a stable level of significant revenue and EBITDA."

Other Highlights                                                                                       

  • Subsequent to the end of the year, Multiband announced that it had executed a $30.0 million financing agreement with Fifth Third Bank and reached an agreement in principal with MDU Communications International, Inc. (MDUC) to revise certain terms of the definitive agreement covering Multiband's acquisition of MDUC.

Conference Call Information

A conference call and live webcast will take place April 1, 2013 at 4:30 p.m. Eastern Time. Anyone interested in participating should call 1-877-941-8416 if calling within the United States or 1-480-629-9808 if calling internationally. There will be a playback available until April 8, 2013. To listen to the playback, please call 1-877-870-5176 if calling within the United States or 1-858-384-5517 if calling internationally. Please use pin number 4610277 for the replay.

The call will also be accompanied live by webcast over the Internet and accessible at http://public.viavid.com/index.php?id=104019.

About Multiband Corporation

Multiband Corporation (Nasdaq: MBND) engages with a vast and growing array of technologies including renewable energy, wireless infrastructure, electrical power systems, digital signage, commercial audio/video solutions, hospitality IPTV and VOD systems. Multiband completes nearly 20% of all DIRECTV's installations, maintenance and upgrades for residents of single-family homes. Multiband also supplies broadband cable and satellite internet solutions for homes and businesses across the nation. As the largest nationwide DIRECTV master system operator in the Multiple Dwelling Unit (MDU) market and one of the largest full-service home service providers (HSPs), Multiband is a driven leader in a competitive industry. Additionally, Multiband is a leading provider of software and integrated billing services to MDUs on a single bill, including video, voice, data and other value-added local services, both directly and through strategic partnerships. Multiband focuses on providing world-class customer service and the highest level of performance for all partners and customers, from multinational corporations to individual families. Multiband is headquartered in Minneapolis, Minn., and has offices strategically placed around the continental United States.

Statements about our future expectations are "forward-looking statements" within the meaning of applicable Federal Securities Laws, and are not guarantees of future performance. When used herein, the words "may," "will," "should," "anticipate," "believe," "appear," "intend," "plan," "expect," "estimate," "approximate," and similar expressions are intended to identify such forward-looking statements. These statements involve risks and uncertainties inherent in our business, including those set forth in our most recent Annual Report on Form 10-K for the year ended December 31, 2011, and other filings with the SEC, and are subject to change at any time. Our actual results could differ materially from these forward-looking statements. We undertake no obligation to update publicly any forward-looking statement.

Company Contact

Contact: James Mandel, CEO for Multiband Corporation at (763) 504-3000

Investor Contact

Brett Maas, Hayden IR, (646) 536-7331 or brett@haydenir.com

NON-GAAP Financial Measures

To comply with Regulation G promulgated pursuant to the Sarbanes-Oxley Act, Multiband has attached to this news release, and will post to the company's investor relations website (www.multibandusa.com), a reconciliation of differences between GAAP and non-GAAP financial information that may be required in connection with issuing the it's quarterly financial results.

Multiband, as is common in its industry, uses Adjusted EBITDA as a measure of performance to demonstrate earnings exclusive of interest and non-cash events. Multiband manages its business based on its cash flows. Multiband, in its daily management of its business affairs and analysis of its monthly, quarterly and annual performance, makes its decisions based on cash flows, not on the amortization of assets obtained through historical activities. Multiband, in managing its current and future affairs, cannot affect the amortization of the intangible assets to any material degree, and therefore uses Adjusted EBITDA as its primary management guide.  Since an outside investor may base its evaluation of Multiband's performance based on the net income of loss and not its cash flows, there is a limitation to the Adjusted EBITDA measurement. Adjusted EBITDA is not, and should not be considered, an alternative to net income or loss, income or loss from operations, or any other measure for determining operating performance of liquidity, as determined under accounting principals generally accepted in the United States (GAAP).  The most directly comparable GAAP reference in Multiband's case is the removal of interest, depreciation, amortization, taxes and other non-cash expense.

Safe Harbor Statement Cautionary Notice: In addition to statements of historical fact, this news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and is intended to enjoy the protection of that Act. These forward-looking statements reflect the Company's expectations or beliefs concerning future events. The Company cautions that these and similar statements involve risk and uncertainties which could cause actual results to differ materially from our expectation, including, but not limited to, changes in economic and market conditions, management of growth, timing and magnitude of future contracts, fluctuations in margins, the introduction of new products and technology, the impact of adverse weather conditions and other risks noted in the Company's SEC filings, including its Annual Report on Form 10-K for its 2010 fiscal year. Forward-looking statements are made in the context of information available as of the date stated. The company undertakes no obligation to update or revise such statements to reflect new circumstances or unanticipated events as they occur.

 

 

 

Multiband Corporation and Subsidiaries

Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)

(in thousands)

(Unaudited)

EBITDA Computation (2012, 4Q12) (in thousands)

2012

4Q12

Net Income (Quarter)

$2,606

$2,485

Non Operating

Gains/Losses

2,610

719

Adjusted Net Income

$5,216

$3,204

Interest Expense

3,701

927

Depreciation & Amortization

7,568

2,291

Taxes

(3,887)

( 4,072)

EBITDA before infrequent items

12,598

2,350

Cable losses

3,186

1,453

Engineering & Wireless losses

1,451

485

Other – (Net of excess healthcare costs and reduction in legal contingency reserves)

739

481

                              Adjusted EBITDA

$17,974

$4,769

 

 

MULTIBAND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

2012

2011

2010

REVENUES

$

305,624

$

300,186

$

265,594

COSTS AND EXPENSES

Cost of products and services (exclusive of depreciation and amortization shown separately below)

224,962

214,559

186,294

Selling, general and administrative

70,306

63,939

57,173

Depreciation and amortization

6,968

6,757

8,298

Impairment of assets

600

246

160

Total costs and expenses

302,836

285,501

251,925

INCOME FROM OPERATIONS

2,788

14,685

13,669

OTHER EXPENSE

Interest expense

(3,701)

(3,838)

(4,202)

Interest income

32

35

8

Proceeds from life insurance

409

Gain on bargain purchase

177

166

Losses attributable to available-for-sale securities

(652)

(1,078)

Other income

75

276

103

Total other expense

(4,069)

(4,030)

(4,091)

INCOME (LOSS) BEFORE INCOME TAXES

(1,281)

10,655

9,578

PROVISION FOR (BENEFIT FROM) INCOME TAXES

(3,887)

3,611

(5,116)

NET INCOME

2,606

7,044

14,694

Preferred stock dividends

370

787

1,488

INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

2,236

$

6,257

$

13,206

INCOME PER COMMON SHARE – BASIC

$

0.10

$

0.37

$

1.32

INCOME PER COMMON SHARE – DILUTED

$

0.10

$

0.32

$

0.91

Weighted average common shares outstanding – basic

21,718,155

16,975,753

10,016,717

Weighted average common shares outstanding – diluted

22,494,132

20,626,529

15,617,353

 

 

MULTIBAND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

ASSETS

(in thousands)

2012

2011

CURRENT ASSETS

Cash and cash equivalents

$

18,056

$

18,169

Available-for-sale securities

1,191

Accounts receivable, net

20,312

28,359

Inventories

11,444

14,276

Costs and estimated earnings in excess of billings on uncompleted contracts

1,540

998

Prepaid expenses and other

1,181

1,361

Income tax receivable

621

42

Deferred tax assets

6,691

6,862

Total Current Assets

59,845

71,258

PROPERTY AND EQUIPMENT, NET

12,273

6,304

OTHER ASSETS

Goodwill

37,796

37,796

Intangible assets, net

10,987

14,597

Restricted cash - certificate of deposit

1,682

Insurance collateral

10,899

8,061

Other assets

1,553

2,452

Deferred tax assets

5,439

1,134

Total Other Assets

68,356

64,040

TOTAL ASSETS

$

140,474

$

141,602

 

 

MULTIBAND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

LIABILITIES AND STOCKHOLDERS' EQUITY

(in thousands, except share and liquidation preference amounts)

2012

2011

CURRENT LIABILITIES

Short-term debt

$

280

$

457

Related party debt

600

Current portion of long-term debt, net of original issue discount

17,396

4,936

Current portion of capital lease obligations

857

324

Accounts payable

24,075

32,354

Billings in excess of costs and estimated earnings on uncompleted contracts

68

41

Accrued liabilities

21,094

24,113

Deferred service obligations and revenue

361

1,570

Total Current Liabilities

64,731

63,795

LONG-TERM LIABILITIES

Accrued liabilities

6,982

5,352

Long-term debt, net of current portion and original issue discount (see Note 18)

20,458

29,229

Capital lease obligations, net of current portion

1,630

274

Total Liabilities

93,801

98,650

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY

Cumulative convertible preferred stock, no par value:

8% Class A (12,696 shares issued and outstanding, $133,308 liquidation preference)

191

191

10% Class C (109,000 shares issued and outstanding, $1,090,000 liquidation preference)

1,411

1,411

10% Class F (150,000 shares issued and outstanding, $1,500,000 liquidation preference)

1,500

1,500

8% Class G (10,000 shares issued and outstanding, $100,000 liquidation preference)

41

41

6% Class H (0.00 and 1.00 shares issued and outstanding, $0 and $100,000 liquidation preference)

Common stock, no par value (21,648,459 and 21,612,380 shares issued and outstanding)

116,775

115,290

Accumulated deficit

(73,245)

(75,481)

Total Stockholders' Equity

46,673

42,952

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

140,474

$

141,602

 

SOURCE Multiband Corporation