Boingo Wireless Reports Third Quarter 2012 Financial Results LOS ANGELES, Nov. 8, 2012 (GLOBE NEWSWIRE) -- Boingo Wireless, Inc. (Nasdaq:WIFI), the world's leading Wi-Fi software and services provider, today announced the company's financial results for the third quarter ended September 30, 2012. Third Quarter 2012 Financial Highlights Boingo Wireless reported revenue of $26.0 million, compared to $24.7 million for the third quarter of 2011, an increase of 5.4 percent. Net income attributable to common stockholders was $2.8 million, or $0.07 per diluted share. This is compared to net income attributable to common stockholders of $1.7 million, or $0.05 per diluted share, for the third quarter of 2011. Adjusted EBITDA was $8.4 million, compared to $8.2 million for the third quarter of 2011, an increase of 2.5 percent. Adjusted EBITDA, which is a non-GAAP financial measure, is defined below and reconciled to net income (loss), the most comparable measure under GAAP, in the section entitled "Use of non-GAAP financial measures." Management Commentary "Boingo's third quarter financial performance was in-line to ahead of our expectations and demonstrates continued progress against our strategic growth initiatives," said David Hagan, President and Chief Executive Officer of Boingo Wireless. "Benefitting from the acquisition of Cloud Nine Media, we saw strong growth in sponsorship revenue during the quarter and are optimistic about the long-term prospects for this revenue stream. At the same time, we expanded our network footprint to over 550,000 global hotspots, which include significant new roaming partnerships and M&O network additions." Mr. Hagan continued, "Core to our investment thesis is the continued exponential growth in mobile data and the opportunity this growth creates for carriers to offload traffic from their cellular networks onto our Wi-Fi network. As such, we are very pleased to announce that we signed a U.S. based tier 1 carrier to a global roaming contract subsequent to quarter-end." Business Highlights Key accomplishments include: *An agreement with a U.S. based tier 1 carrier for global roaming. *A partnership with the Competitive Carriers Association (CCA) to offer Wi-Fi offload solutions to CCA carrier members. *An agreement with the City of Dallas to manage and operate Wi-Fi services throughout the Dallas Love Field Airport (DAL). *An agreement to manage and operate Wi-Fi services at the three most highly-trafficked airports in Norway: Oslo Airport (OSL); Bergen Airport, Flesland (BGO); and Stavanger Airport, Sola (SVG). *A bi-lateral agreement with Linktel Corporate, a leading Brazilian wireless service provider, for Boingo customers to access over 1,400 additional hotspots throughout Brazil. *The introduction of an updated version of its Wi-Finder app for iOS to include a data tracker to help monitor usage, and a VPN for Macbook and Window users. *Strong sponsorship activity included: *Google Offers to expand its sponsorship of Boingo Wi-Fi from six New York subway stations and more than 200 Manhattan hotzones, to 24 additional locations across the country. *Google Play to offer complimentary Boingo Wi-Fi access at more than 4,000 U.S. hotspots. *A Microsoft offer for complimentary Boingo Wi-Fi access at high-traffic New York and San Francisco locations. Business Outlook Boingo Wireless is revising guidance for the full year ending December 31, 2012, as follows: Full Year 2012 *Revenue is expected to be in the range of $101.0 million to $103.0 million. *Adjusted EBITDA is expected to be in the range of $30.5 million to $32.5 million. *Net income attributable to common stockholders is expected to be in the range of $7.5 million to $8.5 million, or $0.21 to $0.23 per diluted share. Conference call information Members of Boingo Wireless' management will host a conference call to discuss its third quarter 2012 financial results beginning at 4:30 pm ET (1:30 pm PT), today, November 8, 2012. To participate in the conference call, investors from the U.S. and Canada should dial (877) 407-0789 ten minutes prior to the scheduled start time. International callers should dial (201) 689-8562. In addition, the call will be broadcast live over the Internet hosted on the Investor Relations section of the company's website at http://investors.boingo.com and will be archived online upon completion of the conference call. Use of non-GAAP financial measures To supplement Boingo Wireless' financial statements presented on a GAAP basis, Boingo Wireless provides Adjusted EBITDA as a supplemental measure of its performance. The company defines Adjusted EBITDA as net income (loss) attributable to common stockholders plus depreciation, accretion of convertible preferred stock, income taxes, amortization of intangible assets, stock‑based compensation expense, non-controlling interests expense and interest expense (income), net. Boingo Wireless believes Adjusted EBITDA is useful to investors in evaluating its operating performance. Boingo's management uses Adjusted EBITDA in conjunction with accounting principles generally accepted in the United States, or GAAP, and operating performance measures as part of its overall assessment of the company's performance for planning purposes, including the preparation of its annual operating budget, to evaluate the effectiveness of its business strategies and to communicate with its board of directors concerning its financial performance. Adjusted EBITDA should not be considered as an alternative financial measure to net (loss) income, which is the most directly comparable financial measure calculated in accordance with GAAP, or any other measure of financial performance calculated in accordance with GAAP. About Boingo Wireless Boingo Wireless, Inc. (Nasdaq:WIFI), the world's leading Wi-Fi software and services provider, makes it easy, convenient and cost-effective for people to enjoy Wi-Fi access on their laptop or mobile device at more than 550,000 hotspots worldwide. With a single account, Boingo users and Boingo's wholesale partners can access the mobile Internet via Boingo Network locations that include the top airports around the world, major hotel chains, cafés and coffee shops, restaurants, convention centers and metropolitan hot zones. Boingo, through its Concourse Communications Group subsidiary, operates Wi-Fi and/or Cellular DAS networks at large-scale venues worldwide such as airports, major sporting arenas, malls, and convention centers, as well as restaurants and retail establishments. The company's Cloud Nine media platform enables brand advertisers to reach a captive audience through high engagement Wi-Fi sponsorships. For more information about Boingo, please visit http://www.boingo.com and http://cloudnine.com. Cautionary Statement Regarding Forward-Looking Statements This press release contains "forward-looking statements" that involves risks, uncertainties and assumptions. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods. These forward-looking statements include the quotations from management in this press release, as well as any statements regarding Boingo's strategic plans and future guidance. Forward-looking statements are based onthe company'scurrent expectations and assumptions regardingits business, the economy and other future conditions. Since forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. The company's actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national or global political, economic, business, competitive, market and regulatory conditions, as well as other risk and uncertainties described more fully in documents filed with or furnished to the Securities and Exchange Commission ("SEC"), including Boingo's Form 10-K for the year ended December 31, 2011 filed with the SEC on April 13, 2012 and Form 10-Q for the quarter ended June 30, 2012 filed with the SEC on August 14, 2012. Any forward-looking statement made by Boingo in this press release speaks only as of the date on which it is made. Factors or events that could cause the company's actual results to differ may emerge from time to time, and it is not possible for Boingo to predict all of them.Boingo undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Boingo, Boingo Wireless, the Boingo Wireless Logo and Don't Just Go. Boingo. are registered trademarks of Boingo Wireless, Inc. All other trademarks are the properties of their respective owners. Boingo Wireless, Inc. Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share amounts) Three Months Ended Nine Months Ended September30, September30, 2012 2011 2012 2011 Revenue $26,017 $24,688 $74,506 $68,659 Costs and operating expenses: Network access 10,061 9,647 29,577 27,153 Network operations 3,693 4,097 10,895 11,765 Development and technology 2,300 2,449 7,792 7,192 Selling and marketing 2,567 1,955 7,237 5,410 General and administrative 2,971 3,236 9,455 8,610 Amortization of intangible assets 296 323 778 1,392 Total costs and operating expenses 21,888 21,707 65,734 61,522 Income from operations 4,129 2,981 8,772 7,137 Interest and other (expense) income, 33 13 170 (292) net Income before income taxes 4,162 2,994 8,942 6,845 Income taxes 1,101 1,194 2,468 1,985 Net income 3,061 1,800 6,474 4,860 Net income attributable to 284 138 579 420 non-controlling interests Net income attributable to Boingo 2,777 1,662 5,895 4,440 Wireless, Inc. Accretion of convertible preferred — — — (1,633) stock Net income attributable to common $2,777 $1,662 $5,895 $2,807 stockholders, basic Net income per share attributable to common stockholders: Basic $0.08 $0.05 $0.17 $0.13 Diluted $0.07 $0.05 $0.16 $0.11 Weighted average shares used in computing net income per share attributable to common stockholders: Basic 35,080 33,139 34,618 20,865 Diluted 37,337 36,678 37,324 24,453 Boingo Wireless, Inc. Condensed Consolidated Balance Sheets (Unaudited) (In thousands, except per share amounts) September30, December31, 2012 2011 Assets Current assets: Cash and cash equivalents $57,350 $93,933 Restricted cash 465 465 Marketable securities 37,219 — Accounts receivable, net of allowances of $92 and 12,019 7,382 $107, respectively Prepaid expenses and other current assets 2,152 1,103 Deferred tax assets 2,088 2,366 Total current assets 111,293 105,249 Property and equipment, net 45,971 39,717 Goodwill 26,744 25,512 Other intangible assets, net 10,547 9,511 Deferred tax assets 4,781 4,083 Other assets 4,946 4,848 Total assets $204,282 $188,920 Liabilities, convertible preferred stock and stockholders' equity (deficit) Current liabilities: Accounts payable $5,293 $4,573 Accrued expenses and other liabilities 10,949 12,759 Deferred revenue 17,817 13,575 Current portion of capital leases 42 205 Total current liabilities 34,101 31,112 Deferred revenue, net of current portion 27,108 27,754 Long-term portion of capital leases 140 197 Other liabilities 307 778 Total liabilities 61,656 59,841 Commitments and contingencies Stockholders' equity (deficit): Preferred stock, $0.0001 par value, 5,000 shares — — authorized, no shares issued and outstanding Common stock, $0.0001 par value; 100,000 shares authorized, 35,162 and 33,584 shares issued and 4 3 outstanding at September30, 2012 and December31, 2011, respectively Additional paid in capital 178,372 170,721 Accumulated deficit (35,947) (41,842) Total common stockholders' equity 142,429 128,882 Non-controlling interests 197 197 Total stockholders' equity 142,626 129,079 Total liabilities, convertible preferred stock and $204,282 $188,920 stockholders' equity Boingo Wireless,Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) NineMonthsEnded September30, 2012 2011 Cash flows from operating activities Net income $6,474 $4,860 Adjustments to reconcile net income including non-controlling interests to net cashprovided by operating activities: Depreciation and amortization of property and equipment 11,672 8,894 Amortization of intangible assets 778 1,392 Stock-based compensation 2,163 2,275 Forgiveness of notes receivable from stockholder — 103 Excess tax benefits from stock-based compensation (1,531) — Change in fair value of preferred stock warrants — 140 Change in deferred income taxes (420) (857) Changes in operating assets and liabilities, net of effect of acquisition: Accounts receivable (4,053) 2,054 Unbilled receivables 671 (304) Prepaid expenses and other assets 1,767 54 Accounts payable (821) 55 Accrued expenses and other liabilities (3,552) 419 Deferred revenue 3,596 901 Net cash provided by operating activities 16,744 19,986 Cash flows from investing activities Increasein restricted cash — (65) Purchase of marketable securities (52,232) — Sales of marketable securities 15,013 1,000 Purchases of property and equipment (15,755) (13,154) Acquisition, net of cash acquired (3,185) — Contractual payments related to business acquisition (14) (127) Net cash used in investing activities (56,173) (12,346) Cash flows from financing activities Excess tax benefits from stock-based compensation 1,531 — Proceeds from exercise of stock options 2,124 602 Payments of capital leases (189) (330) Payments to non-controlling interests (620) (547) Proceeds from issuance of common stock upon initial public — 48,297 offering Offering costs — (2,529) Net cash provided by financing activities 2,846 45,493 Net increase in cash and cash equivalents (36,583) 53,133 Cash and cash equivalents at beginning of period 93,933 25,721 Cash and cash equivalents at end of period $57,350 $78,854 Supplemental disclosure of cash flow information Cash paid for taxes $650 $1,194 Supplemental disclosure of non-cash investing and financing activities Conversion of convertible preferred stock into common stock — 124,602 Property and equipment and software maintenance costs in 4,129 2,247 accounts payable, accruedexpenses and other liabilities Accretion of convertible preferred stock — 1,633 Exercise and conversion of preferred stock warrants into — 272 common stock Boingo Wireless,Inc. Schedule of Non-GAAP Reconciliations (In thousands) (Unaudited) Three Months Ended Nine Months Ended September30, September30, 2012 2011 2012 2011 Net income attributable to common $2,777 $1,662 $5,895 $2,807 Stockholders Depreciation and amortization of Property and equipment 3,798 3,555 11,672 8,894 Accretion of convertible preferred stock — — — 1,633 Income tax expense 1,101 1,194 2,468 1,985 Amortization of intangible assets 296 323 778 1,392 Stock-based compensation expense 218 1,374 2,163 2,275 Non-controlling interests 284 138 579 420 Interest expense (income), net (33) (13) (170) 292 Adjusted EBITDA $8,441 $8,233 $23,385 $19,698 CONTACT: Christian Gunning Vice President, Corporate Communications firstname.lastname@example.org (310) 586-4009 Andrew Greenebaum / Laura Foster Addo Communications email@example.com / firstname.lastname@example.org (310) 829-5400
Boingo Wireless Reports Third Quarter 2012 Financial Results
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