USA Mobility Reports First Quarter Operating Results; Board Declares Regular Quarterly Dividend

  USA Mobility Reports First Quarter Operating Results; Board Declares Regular   Quarterly Dividend           Wireless Subscriber and Revenue Trends Continue to Improve;        Software Revenues Increase, Bookings and Backlog Remain Strong;                 Operating Cash Flow Higher as Expenses Decline  Business Wire  SPRINGFIELD, Va. -- May 09, 2013  USA Mobility, Inc. (Nasdaq: USMO), a leading provider of wireless messaging, mobile voice and data and unified communications solutions, today announced operating results for the first quarter ended March 31, 2013. In addition, the Company’s Board of Directors declared a regular quarterly dividend of $0.125 per share, payable on June 25, 2013 to stockholders of record on May 20, 2013.  Consolidated revenue for the first quarter was $53.1 million, compared to $51.9 million in the fourth quarter  and $56.7 million in the first quarter of 2012. Revenue from the Company’s Wireless business (USA Mobility Wireless) was $38.8 million in the first quarter, compared to $39.9 million in the fourth quarter and $44.3 million in the first quarter of 2012. Revenue from the Software business (Amcom Software) increased to $14.4 million, from $12.0 million in the fourth quarter and $12.5 million in the first quarter of 2012.  First quarter EBITDA (earnings before interest, taxes, depreciation, amortization and accretion) totaled $15.5 million, or 29.3 percent of revenue, compared to $18.8 million, or 33.1 percent of revenue, in the year-earlier quarter. First quarter EBITDA included $14.3 million from Wireless and $1.2 million from Software. EBITDA from Wireless of $14.3 million compared to $14.0 million in the prior quarter and $17.5 million in the year-earlier quarter.  Net income for the first quarter was $6.9 million, or $0.32 per fully diluted share, compared to $8.5 million, or $0.37 per fully diluted share, in the first quarter of 2012.  Key results and highlights for the first quarter included:  Wireless    *Net unit losses improved to 35,000 in the first quarter from 51,000 in the     first quarter of 2012, while the quarterly rate of unit erosion was 2.3     percent versus 3.0 percent in the year-earlier quarter. The annual rate of     subscriber erosion improved to a record low 8.5 percent in the first     quarter, compared to 9.2 percent in the fourth quarter and 11.5 percent in     the year-ago quarter. Units in service at March 31, 2013 totaled     1,480,000, compared to 1,617,000 a year earlier.   *The quarterly rate of revenue erosion improved to 2.9 percent from 4.9     percent in the first quarter of 2012, while the annual rate of revenue     erosion improved to 12.4 percent from 15.7 percent in the year-earlier     quarter.   *Total ARPU (average revenue per unit) was $8.25 in the first quarter,     compared to $8.29 in the fourth quarter and $8.50 in the first quarter of     2012.   *First quarter EBITDA margin for Wireless was 36.9 percent, compared to     35.0 percent in the fourth quarter and 39.5 percent in the year-earlier     quarter.  Software    *Bookings for the first quarter increased to $14.3 million from $12.4     million in the first quarter of 2012.   *The backlog was $40.2 million at March 31, 2013, compared to $32.7 million     a year earlier (as restated).   *Of the $14.4 million in Software revenue for the first quarter, $6.8     million was maintenance revenue and $7.6 million was operations revenue,     compared to $6.4 million and $6.1 million, respectively, of the $12.5     million in Software revenue for first quarter of 2012.   *The renewal rate for maintenance in the first quarter was 98.8 percent.  Total Company    *Consolidated operating expenses (excluding depreciation, amortization and     accretion) totaled $37.6 million in the first quarter, with $24.5 million     for Wireless and $13.1 million for Software, compared to $38.0 million in     the first quarter of 2012, with $26.8 million for Wireless and $11.2     million for Software.   *Capital expenses were $2.3 million, compared to $1.6 million in the first     quarter of 2012.   *Dividends paid to stockholders totaled $2.7 million in the first quarter.   *The Company’s cash balance at March 31, 2013 was $71.7 million.   *The number of full-time equivalent employees at March 31, 2013 totaled     656, including 367 for Wireless and 289 for Software, compared to a total     of 685 at March 31, 2012, including 420 for Wireless and 265 for Software.  Vincent D. Kelly, president and chief executive officer, said: “USA Mobility continued to make excellent progress in the first quarter. Both our Wireless and Software businesses met or exceeded their performance goals in virtually all operating categories as consolidated revenue increased and expenses declined from the prior quarter. In addition, we continued to maintain strong operating cash flow and operating margins, and generated sufficient cash flow to again return capital to stockholders in the form of dividend distributions.”  Kelly added: “Once again our Wireless business exceeded expectations for gross additions, revenue, ARPU, and expenses. We were also pleased to see our annual rates of subscriber and revenue erosion reach record lows.”  Kelly said the Company’s Wireless sales efforts during the quarter continued to focus on the core market segments of Healthcare, Government and Large Enterprise. “These core segments represented approximately 92 percent of our direct subscriber base and 88 percent of our direct paging revenue at the end of the quarter. Healthcare comprised 72.5 percent of our direct subscriber base at March 31^st and continued to be our best performing market segment with the highest percentage of direct gross additions (82.6%) and the lowest rate of direct net unit loss (0.5%). Clearly, Healthcare providers continue to recognize and benefit from the reliability and cost advantages of paging for their most critical messaging needs.”  Commenting on the Software business, Kelly said: “First quarter revenue and bookings increased from the year-earlier quarter while our backlog was up 23 percent to $40.2 million from a year ago. In addition, our sales team brought in a record number of large contracts during the quarter from the Healthcare and Government business segments and continued to build a solid pipeline of prospective business. Customer demand remained strong for such software solutions as call center management, clinical alerting middleware, critical smartphone communications and emergency notification. While sales activity remained strongest in North America, we also added new accounts in the Asia-Pacific region and Middle East, including a major medical and research center in Qatar.”  During the quarter the Company introduced a software upgrade that significantly improves physician and nurse communications. “The enhancement links two of our most popular software solutions, Amcom Mobile Connect and Amcom Care Connect,” said Kelly. “Amcom Mobile Connect supports secure and HIPPA-compliant text-messaging, while Amcom Care Connect helps caregivers connect quickly on their own schedules and preferred devices. The new feature – Amcom Mobile Connect 3.3 – provides a “chat view” screen and updates page that makes it easier for caregivers to connect with one another. The solution gives physicians and nurses the flexibility to talk or text, plus it incorporates critical escalation features when a caregiver is unavailable. Many of our 900 hospital customers had previously requested this specific type of solution, so we’re very pleased to be able to integrate this capability to enhance patient safety and care.”  Shawn E. Endsley, chief financial officer, said the Company continued its positive momentum from 2012 in both the Wireless and Software businesses. “Lower revenue and subscriber churn along with operating expense management in the Wireless business contributed to strong operating cash flow and EBITDA,” he noted. “In addition, higher bookings and backlog in the Software business reflect continuation of the positive trends from the second half of 2012.”  Regarding financial guidance for 2013, Endsley said the Company currently projects total revenue to range from $195 million to $213 million, operating expenses (excluding depreciation, amortization and accretion) to range from $150 million to $152 million, and capital expenses to range from $8.1 million to $9.7 million.  USA Mobility’s Annual Meeting of Stockholders will be held at 9:00 am EST on Tuesday, July 23, 2013 at The Westin Alexandria, 400 Courthouse Square, Alexandria, Virginia.  USA Mobility plans to host a conference call for investors on its first quarter results at 10:00 a.m. Eastern Time on Friday, May 10, 2013. Dial-in numbers for the call are 719-325-2432 or 888-417-8516. The pass code for the call is 8073557. A replay of the call will be available from 1:00 p.m. ET on May 10 until 1:00 p.m. on Friday, May 24. Replay numbers are 719-457-0820 or 888-203-1112. The pass code for the replay is 8073557.  About USA Mobility  USA Mobility, Inc., headquartered in Springfield, Virginia, is a comprehensive provider of reliable and affordable wireless communications solutions to the healthcare, government, large enterprise and emergency response sectors through its wireless subsidiary, USA Mobility Wireless. In addition, through its software subsidiary, Amcom Software, it provides mission critical unified communications solutions nationally and internationally to leading organizations in such industries as healthcare, hospitality, education, business and government. Amcom connects people to each other and the data the need. Its software solutions include critical smartphone communications, contact center optimization, emergency management and clinical workflow improvement. As a single-source provider, USA Mobility  Wireless focuses on the business-to-business marketplace and supplies wireless connectivity solutions to organizations nationwide. The Company operates the largest one-way paging and advanced two-way paging networks in the United States. USA Mobility Wireless also offers mobile voice and data services through Sprint Nextel and T-Mobile, including BlackBerry® smartphones and GPS location applications. Its product offerings include customized wireless connectivity systems for the healthcare, government and other campus environments. For further information visit www.usamobility.com and www.amcomsoftware.com.  Safe Harbor Statement under the Private Securities Litigation Reform Act: Statements contained herein or in prior press releases which are not historical fact, such as statements regarding USA Mobility’s future operating and financial performance, are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that may cause USA Mobility’s actual results to be materially different from the future results expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expectations include, but are not limited to, declining demand for paging products and services, continued growth of our Software business and demand for our Software products and services, our ability to develop additional software solutions for our customers, the ability to continue to reduce operating expenses, future capital needs, competitive pricing pressures, competition from both traditional paging services and other wireless communications services, competition from other software providers, government regulation, reliance upon third-party providers for certain equipment and services, as well as other risks described from time to time in periodic reports and registration statements filed with the Securities and Exchange Commission. Although USA Mobility believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. USA Mobility disclaims any intent or obligation to update any forward-looking statements.                                                                                        USA MOBILITY, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (a) (Unaudited and in thousands, except share, per share amounts and ARPU)                                                                                                                       For the three months ended March 31,                    2013                                            2012                                                           Wireless     Software     Total              Wireless     Software     Total                                                                                                    Revenue: Paging service     $ 37,051       $ -            $ 37,051           $ 41,875       $ -            $ 41,875 Cellular             195            -              195                277            -              277 Software revenue and          1,372          14,351         15,723             1,787          12,470         14,257 other (b) Other               161        -          161              326        -          326         Total revenue       38,779     14,351     53,130           44,265     12,470     56,735                                                                                                         Operating expenses: Cost of products sold        (5     )       5,188          5,183              173            4,643          4,816 (b) Service, rental and           10,829         2,203          13,032             12,034         2,269          14,303 maintenance (b) Selling and          2,476          3,740          6,216              3,048          2,605          5,653 marketing General and          11,181         1,971          13,152             11,508         1,661          13,169 administrative Severance and        -              -              -                  9              13             22 restructuring Depreciation, amortization        2,396      1,411      3,807            2,815      1,700      4,515       and accretion Total operating           26,877     14,513     41,390           29,587     12,891     42,478      expenses % of total           69.3   %       101.1  %       77.9       %       66.8   %       103.4  %       74.9       % revenue                                                                                       Operating           11,902     (162   )    11,740           14,678     (421   )    14,257      income (loss) % of total           30.7   %       -1.1   %       22.1       %       33.2   %       -3.4   %       25.1       % revenue                                                                                                    Interest             (64    )       -              (64        )       (188   )       -              (188       ) expense, net Other income        89         (8     )    81               (46    )    (16    )    (62        ) (expense), net Income (loss) before income        11,927         (170   )       11,757             14,444         (437   )       14,007 tax (expense) benefit Income tax (expense)           (4,897 )    65         (4,832     )      (5,718 )    173        (5,545     ) benefit Net income         $ 7,030     $ (105   )   $ 6,925           $ 8,726     $ (264   )   $ 8,462       (loss)                                                                                                    Basic net income per                                       $ 0.32                                          $ 0.38        common share Diluted net income per                                       $ 0.32                                          $ 0.37        common share                                                                                                    Basic weighted average common                                    21,688,153                                     22,106,543  shares outstanding Diluted weighted average common                                    21,904,862                                     22,589,483  shares outstanding                                                                                                                                                                                                       Reconciliation of operating income (loss) to EBITDA (c): Operating          $ 11,902       $ (162   )     $ 11,740           $ 14,678       $ (421   )     $ 14,257 income (loss) Add back: depreciation,       2,396      1,411      3,807            2,815      1,700      4,515       amortization and accretion EBITDA             $ 14,298    $ 1,249     $ 15,547          $ 17,493    $ 1,279     $ 18,772      % of total           36.9   %       8.7    %       29.3       %       39.5   %       10.3   %       33.1       % revenue                                                                                                    Key statistics: Units in             1,480          -              1,480              1,617          -              1,617 service Average revenue per        $ 8.25         $ -            $ 8.25             $ 8.50         $ -            $ 8.50 unit (ARPU) Bookings           $ -            $ 14,253       $ 14,253           $ -            $ 12,417       $ 12,417 Backlog            $ -            $ 40,183       $ 40,183           $ -            $ 32,688       $ 32,688  (a) Slight variations in totals are due to rounding.  (b) Wireless results reflect eliminations for intercompany revenue and expenses.  (c) EBITDA or earnings before interest, taxes, depreciation, amortization and accretion is a non-GAAP measure and is presented for analytical purposes only.                                                             USA MOBILITY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (a) (In thousands)                                                                                                                   3/31/13        12/31/12                                                (Unaudited)                                                                 Assets Current assets: Cash and cash equivalents                      $  71,694       $ 61,046 Accounts receivable, net                          20,191         21,580 Prepaid expenses and other                        5,907          5,836 Inventory                                         3,032          3,257 Escrow receivables                                275            275 Deferred income tax assets, net                  4,929       3,915 Total current assets                              106,028        95,909 Property and equipment, net                       20,783         20,809 Goodwill                                          133,031        133,031 Other intangible assets, net                      29,088         30,333 Deferred income tax assets, net                   35,642         41,239 Other assets                                     1,243       1,306 Total assets                                   $  325,815    $ 322,627                                                                 Liabilities and stockholders' equity Current liabilities: Accounts payable and accrued liabilities       $  12,876       $ 12,659 Accrued compensation and benefits                 16,715         17,806 Consideration payable                             275            275 Customer deposits                                 2,660          2,090 Deferred revenue                                 26,911      27,896 Total current liabilities                         59,437         60,726 Deferred revenue                                  605            693 Other long-term liabilities                      9,594       9,789 Total liabilities                                69,636      71,208 Commitments and contingencies Stockholders' equity: Preferred stock                                   -              - Common stock                                      2              2 Additional paid-in capital                        125,823        125,212 Retained earnings                                130,354     126,205 Total stockholders' equity                       256,179     251,419 Total liabilities and stockholders' equity     $  325,815    $ 322,627                                                                 (a) Slight variations in totals are due to rounding.                                                                 USA MOBILITY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (a) (Unaudited and in thousands)                                                                                                                        For the three months ended                                                      3/31/13         3/31/12                                                                     Cash flows from operating activities: Net income                                         $ 6,925         $ 8,462 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, amortization and accretion             3,807           4,515 Amortization of deferred financing costs             64              65 Deferred income tax expense                          4,570           5,387 Amortization of stock based compensation             626             437 Provision for doubtful accounts, service             405             411 credits and other Adjustment of non-cash transaction taxes             (132    )       (123    ) (Gain)/Loss on disposals of property and             (1      )       162 equipment Changes in assets and liabilities: Accounts receivable                                  984             358 Prepaid expenses, intangibles and other assets       161             118 Accounts payable and accrued liabilities             (1,236  )       (3,680  ) Customer deposits and deferred revenue              (503    )    (171    ) Net cash provided by operating activities           15,670      15,941                                                                       Cash flows from investing activities: Purchase of property and equipment                   (2,341  )       (1,551  ) Proceeds from disposals of property and             1           8        equipment Net cash used in investing activities               (2,340  )    (1,543  )                                                                     Cash flows from financing activities: Repayment of debt                                    -               (25,000 ) Cash dividends to stockholders                      (2,682  )    (5,535  ) Net cash used in financing activities               (2,682  )    (30,535 )                                                                                                                                         Net increase/(decrease) in cash and cash             10,648          (16,137 ) equivalents Cash and cash equivalents, beginning of period      61,046      53,655   Cash and cash equivalents, end of period           $ 71,694     $ 37,518                                                                       Supplemental disclosure: Interest paid                                      $ 4          $ 220      Income taxes paid                                  $ 168        $ 224                                                                          (a) Slight variations in totals are due to rounding.                                                                                       USA MOBILITY, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (a) (Unaudited and in thousands, except share, per share amounts and ARPU)                                                                                                                    For the three months ended                      3/31/13            12/31/12           9/30/12            6/30/12            3/31/12                                                                                                 Revenues: Paging service     $ 37,051           $ 38,081           $ 39,235           $ 40,548           $ 41,875 Cellular             195                275                314                286                277 Software revenue and          15,723             13,381             15,321             14,847             14,257 other Other               161            147            246            280            326         Total revenues      53,130         51,884         55,116         55,961         56,735                                                                                                      Operating expenses: Cost of              5,183              5,709              5,105              5,216              4,816 products sold Service, rental and           13,032             13,499             13,731             13,892             14,303 maintenance Selling and          6,216              6,030              6,043              5,919              5,653 marketing General and          13,152             12,551             12,466             12,494             13,169 administrative Severance and        -                  1,712              -                  24                 22 restructuring Depreciation, amortization         3,807              4,387              4,724              4,606              4,515 and accretion Impairment          -              3,382          -              -              -           Total operating           41,390         47,270         42,069         42,151         42,478      expenses % of total           77.9       %       91.1       %       76.3       %       75.3       %       74.9       % revenues                                                                                                 Operating            11,740             4,614              13,047             13,810             14,257 income % of total           22.1       %       8.9        %       23.7       %       24.7       %       25.1       % revenues                                                                                                 Interest             (64        )       (62        )       (64        )       (66        )       (188       ) expense, net Other income        81             289            52             436            (62        ) (expense), net Income before income tax           11,757             4,841              13,035             14,180             14,007 expense Income tax          (4,832     )    (2,814     )    (4,987     )    (5,733     )    (5,545     ) expense Net income         $ 6,925         $ 2,027         $ 8,048         $ 8,447         $ 8,462                                                                                                       Basic net income per         $ 0.32          $ 0.09          $ 0.37          $ 0.38          $ 0.38        common share Diluted net income per         $ 0.32          $ 0.09          $ 0.36          $ 0.37          $ 0.37        common share                                                                                                 Basic weighted average common      21,688,153     21,492,792     21,973,473     22,130,397     22,106,543  shares outstanding Diluted weighted average common      21,904,862     21,991,673     22,399,934     22,613,517     22,589,483  shares outstanding                                                                                                 Reconciliation of operating income to EBITDA (b): Operating          $ 11,740           $ 4,614            $ 13,047           $ 13,810           $ 14,257 income Add back: depreciation, amortization,       3,807          7,769          4,724          4,606          4,515       accretion and impairment EBITDA             $ 15,547        $ 12,383        $ 17,771        $ 18,416        $ 18,772      % of total           29.3       %       23.9       %       32.2       %       32.9       %       33.1       % revenues                                                                                                 Key statistics: Units in             1,480              1,515              1,546              1,583              1,617 service Average revenue per        $ 8.25             $ 8.29             $ 8.36             $ 8.45             $ 8.50 unit (ARPU) Bookings           $ 14,253           $ 18,129           $ 15,670           $ 15,085           $ 12,417 Backlog            $ 40,183           $ 40,626           $ 36,155           $ 34,391           $ 32,688  (a) Slight variations in totals are due to rounding.  (b) EBITDA or earnings before interest, taxes, depreciation, amortization, accretion and impairment is a non-GAAP measure and is presented for analytical purposes only.                                                                          USA MOBILITY, INC. CONSOLIDATED OPERATING EXPENSES SUPPLEMENTAL INFORMATION (a) (Unaudited and in thousands)                                                                                                           For the three months ended                          3/31/13       12/31/12       9/30/12       6/30/12         3/31/12                                                                                    Cost of products sold Payroll and            $ 2,838       $ 2,634        $ 2,427       $ 2,324         $ 2,368 related Cost of sales            1,890         2,500          2,195         2,434           2,037 Other                   455        575         483        458         411 Total cost of           5,183      5,709       5,105      5,216       4,816 products sold                                                                                    Service, rental and maintenance Site rent                4,235         4,326          4,326         4,421           4,791 Telecommunications       1,889         2,053          2,257         2,346           2,312 Payroll and              5,203         5,432          5,309         5,360           5,529 related Stock based              10            7              6             6               6 compensation Other                   1,695      1,681       1,833      1,759       1,665 Total service, rental and              13,032     13,499      13,731     13,892      14,303 maintenance                                                                                    Selling and marketing Payroll and              3,594         3,519          3,504         3,544           3,559 related Commissions              1,387         1,197          1,335         1,343           1,253 Stock based              17            19             19            18              16 compensation Other                   1,218      1,295       1,185      1,014       825 Total selling and       6,216      6,030       6,043      5,919       5,653 marketing                                                                                    General and administrative Payroll and              6,026         6,423          5,851         5,972           6,490 related Stock based              599           296            435           (19     )       415 compensation Bad debt                 275           300            275           270             234 Facility rent            844           889            903           868             806 Telecommunications       375           379            390           443             412 Outside services         3,077         2,377          2,353         2,458           2,447 Taxes, licenses          1,233         1,312          1,249         1,426           1,501 and permits Other                   723        575         1,010      1,076       864 Total general and       13,152     12,551      12,466     12,494      13,169 administrative                                                                                    Severance and            -             1,712          -             24              22 restructuring Depreciation, amortization and         3,807         4,387          4,724         4,606           4,515 accretion Impairment              -          3,382       -          -           - Total operating        $ 41,390    $ 47,270     $ 42,069    $ 42,151     $ 42,478 expenses                                                                                    Capital                $ 2,341       $ 2,854        $ 2,696       $ 2,888         $ 1,551 expenditures                                                                                    (a) Slight variations in totals are due to rounding.                                                                 USA MOBILITY, INC. (WIRELESS) UNITS IN SERVICE ACTIVITY (a) (Unaudited and in thousands)                                                                                           For the three months ended                 3/31/13       12/31/12       9/30/12       6/30/12       3/31/12 Units in service                                                                           Beginning units in service Direct          1,346         1,366          1,395         1,423         1,465 one-way Direct          75         79          82         85         90       two-way Total           1,421      1,445       1,477      1,508      1,555    direct Indirect        48            55             58            60            63 one-way Indirect        46         46          48         49         50       two-way Total           94         101         106        109        113      indirect Total beginning       1,515      1,546       1,583      1,617      1,668    units in service                                                                           Gross placements Direct          39            46             45            49            41 one-way Direct          3          2           3          4          3        two-way Total           42         48          48         53         44       direct Indirect        1             2              1             2             1 one-way Indirect        -          -           -          -          -        two-way Total           1          2           1          2          1        indirect Total gross     43         50          49         55         45       placements                                                                           Gross disconnects Direct          (61     )     (66      )     (74     )     (77     )     (83     ) one-way Direct          (5      )   (6       )   (6      )   (7      )   (8      ) two-way Total           (66     )   (72      )   (80     )   (84     )   (91     ) direct Indirect        (11     )     (9       )     (4      )     (4      )     (4      ) one-way Indirect        (1      )   -           (2      )   (1      )   (1      ) two-way Total           (12     )   (9       )   (6      )   (5      )   (5      ) indirect Total gross     (78     )   (81      )   (86     )   (89     )   (96     ) disconnects                                                                           Net loss Direct          (22     )     (20      )     (29     )     (28     )     (42     ) one-way Direct          (2      )   (4       )   (3      )   (3      )   (5      ) two-way Total           (24     )   (24      )   (32     )   (31     )   (47     ) direct Indirect        (10     )     (7       )     (3      )     (2      )     (3      ) one-way Indirect        (1      )   -           (2      )   (1      )   (1      ) two-way Total           (11     )   (7       )   (5      )   (3      )   (4      ) indirect Total net       (35     )   (31      )   (37     )   (34     )   (51     ) change                                                                           Ending units in service Direct          1,324         1,346          1,366         1,395         1,423 one-way Direct          73         75          79         82         85       two-way Total           1,397      1,421       1,445      1,477      1,508    direct Indirect        38            48             55            58            60 one-way Indirect        45         46          46         48         49       two-way Total           83         94          101        106        109      indirect Total ending          1,480      1,515       1,546      1,583      1,617    units in service                                                                           (a) Slight variations in totals are due to rounding.                                                                        USA MOBILITY, INC. (WIRELESS) AVERAGE REVENUE PER UNIT (ARPU) AND CHURN (a) (Unaudited)                                                                                                 For the three months ended                  3/31/13         12/31/12         9/30/12         6/30/12         3/31/12                                                                                  ARPU Direct         $ 7.73          $ 7.78           $ 7.84          $ 7.89          $ 7.91 one-way Direct          20.41       20.52        20.55       20.88       21.08    two-way Total            8.40            8.47             8.54            8.62            8.67 direct                                                                                  Indirect         8.22            7.51             7.25            7.48            7.61 one-way Indirect        3.76        3.87         4.08        4.19        4.33     two-way Total            5.85            5.74             5.77            5.97            6.14 indirect                                                                                  Total            7.74            7.77             7.82            7.88            7.90 one-way Total           13.96       14.16        14.36       14.69       15.00    two-way Total paging         $ 8.25       $ 8.29        $ 8.36       $ 8.45       $ 8.50     ARPU                                                                                                                                                                                                                                                    Gross disconnect rate (b) Direct           -4.6    %       -4.8     %       -5.3    %       -5.4    %       -5.7    % one-way Direct          -6.6    %    -7.8     %    -7.7    %    -8.5    %    -8.3    % two-way Total            -4.7    %       -5.0     %       -5.5    %       -5.6    %       -5.8    % direct                                                                                  Indirect         -23.6   %       -16.1    %       -7.6    %       -6.6    %       -7.0    % one-way Indirect        -1.6    %    -1.6     %    -3.1    %    -1.8    %    -1.7    % two-way Total            -12.5   %       -9.3     %       -5.5    %       -4.4    %       -4.7    % indirect                                                                                  Total            -5.2    %       -5.3     %       -5.4    %       -5.4    %       -5.8    % one-way Total           -4.7    %    -5.4     %    -6.0    %    -6.0    %    -5.9    % two-way Total paging gross           -5.2    %    -5.3     %    -5.5    %    -5.5    %    -5.8    % disconnect rate                                                                                                                                                                                                                                                    Net loss (c) Direct           -1.7    %       -1.5     %       -2.1    %       -1.9    %       -2.9    % one-way Direct          -1.9    %    -4.9     %    -4.0    %    -3.9    %    -4.9    % two-way Total            -1.7    %       -1.7     %       -2.2    %       -2.0    %       -3.0    % direct                                                                                  Indirect         -21.8   %       -13.2    %       -5.6    %       -4.9    %       -5.4    % one-way Indirect        -1.3    %    -1.3     %    -2.5    %    -1.2    %    -0.9    % two-way Total            -11.5   %       -7.6     %       -4.2    %       -3.2    %       -3.4    % indirect                                                                                  Total            -2.4    %       -1.9     %       -2.2    %       -2.0    %       -3.0    % one-way Total           -1.6    %    -3.5     %    -3.5    %    -2.9    %    -3.5    % two-way Total paging net      -2.3    %    -2.0     %    -2.3    %    -2.1    %    -3.0    % loss rate  (a) Slight variations in totals are due to rounding.  (b) Gross disconnect rate is current period disconnected units divided by prior period ending units in service.  (c) Net loss rate is net current period placements and disconnected units in service divided by prior period ending units in service.                                                                USA MOBILITY, INC. (WIRELESS) SUPPLEMENTAL INFORMATION BY MARKET SEGMENT (a) (Unaudited)                                                                                         For the three months ended                3/31/13       12/31/12       9/30/12       6/30/12       3/31/12                                                                          Gross placement rate (b) Healthcare     3.4     %     3.9      %     3.7     %     4.3     %     3.3     % Government     1.6     %     1.5      %     2.5     %     1.8     %     1.3     % Large          2.1     %     2.3      %     2.0     %     1.9     %     2.4     % enterprise Other          1.8     %   1.9      %   2.1     %   2.0     %   2.2     % Total          3.0     %     3.3      %     3.2     %     3.5     %     2.8     % direct Total          1.0     %   1.7      %   1.3     %   1.2     %   1.3     % indirect Total          2.9     %   3.2      %   3.1     %   3.4     %   2.7     %                                                                          Gross disconnect rate (b) Healthcare     -3.9    %     -4.4     %     -4.5    %     -4.5    %     -4.7    % Government     -5.9    %     -6.7     %     -6.8    %     -7.0    %     -7.7    % Large          -7.0    %     -5.7     %     -7.3    %     -8.0    %     -7.7    % enterprise Other          -7.3    %   -7.0     %   -8.1    %   -8.7    %   -9.2    % Total          -4.7    %     -5.0     %     -5.5    %     -5.6    %     -5.8    % direct Total          -12.5   %   -9.3     %   -5.5    %   -4.4    %   -4.7    % indirect Total          -5.2    %   -5.3     %   -5.5    %   -5.5    %   -5.8    %                                                                          Net loss rate (b) Healthcare     -0.5    %     -0.4     %     -0.9    %     -0.2    %     -1.4    % Government     -4.3    %     -5.2     %     -4.3    %     -5.2    %     -6.4    % Large          -4.9    %     -3.4     %     -5.3    %     -6.1    %     -5.3    % enterprise Other          -5.5    %   -5.1     %   -5.9    %   -6.8    %   -7.1    % Total          -1.7    %     -1.7     %     -2.2    %     -2.0    %     -3.0    % direct Total          -11.5   %   -7.6     %   -4.2    %   -3.2    %   -3.4    % indirect Total          -2.3    %   -2.0     %   -2.3    %   -2.1    %   -3.0    %                                                                          End of period units in service % of total (b) Healthcare     68.4    %     67.1     %     65.9    %     64.9    %     63.6    % Government     10.1    %     10.3     %     10.8    %     11.1    %     11.5    % Large          8.3     %     8.5      %     8.6     %     8.9     %     9.3     % enterprise Other          7.6     %   7.9      %   8.1     %   8.4     %   8.8     % Total          94.4    %     93.8     %     93.4    %     93.3    %     93.2    % direct Total          5.6     %   6.2      %   6.6     %   6.7     %   6.8     % indirect Total          100.0   %   100.0    %   100.0   %   100.0   %   100.0   %  (a) Slight variations in totals are due to rounding.  (b) Changes in the classification of units in service are reflected in the quarter when such changes are identified. Such changes are then appropriately reflected in calculating the gross placement, gross disconnect and net loss rates.                                                                         USA MOBILITY, INC. (WIRELESS) SUPPLEMENTAL INFORMATION - DIRECT UNITS IN SERVICE AND CELLULAR ACTIVATIONS (a) (Unaudited)                                                                                                   For the three months ended                   3/31/13         12/31/12         9/30/12         6/30/12         3/31/12                                                                                   Account size ending units in service (000's) 1 to 3            49              52               55              58              61 units 4 to 10           29              31               33              35              37 units 11 to 50          71              75               78              82              86 units 51 to 100         47              49               50              52              54 units 101 to            321             334              343             356             373 1,000 units >1,000           880         880          886         894         897      units Total            1,397       1,421        1,445       1,477       1,508                                                                                      End of period units in service % of total direct 1 to 3            3.5     %       3.6      %       3.8     %       3.9     %       4.1     % units 4 to 10           2.1     %       2.2      %       2.3     %       2.3     %       2.3     % units 11 to 50          5.1     %       5.3      %       5.4     %       5.6     %       5.7     % units 51 to 100         3.4     %       3.5      %       3.5     %       3.5     %       3.6     % units 101 to            23.0    %       23.5     %       23.7    %       24.1    %       24.8    % 1,000 units >1,000           62.9    %    61.9     %    61.3    %    60.6    %    59.5    % units Total            100.0   %    100.0    %    100.0   %    100.0   %    100.0   %                                                                                   Account size net loss rate 1 to 3            -4.8    %       -5.5     %       -5.3    %       -5.7    %       -6.2    % units 4 to 10           -6.0    %       -5.5     %       -4.8    %       -6.2    %       -6.2    % units 11 to 50          -4.8    %       -4.6     %       -4.8    %       -4.1    %       -7.1    % units 51 to 100         -4.0    %       -2.6     %       -3.9    %       -2.4    %       -3.9    % units 101 to            -3.9    %       -2.6     %       -3.8    %       -4.7    %       -1.7    % 1,000 units >1,000           -0.2    %    -0.6     %    -1.0    %    -0.3    %    -2.7    % units Total            -1.7    %    -1.7     %    -2.2    %    -2.0    %    -3.0    %                                                                                   Account size ARPU 1 to 3          $ 15.22         $ 15.29          $ 15.43         $ 15.49         $ 15.49 units 4 to 10           14.33           14.39            14.42           14.40           14.45 units 11 to 50          12.06           12.04            12.11           12.24           12.15 units 51 to 100         10.47           10.47            10.48           10.35           10.52 units 101 to            8.84            8.94             8.97            9.01            9.04 1,000 units >1,000           7.23        7.24         7.28        7.34        7.35     units Total           $ 8.40       $ 8.47        $ 8.54       $ 8.62       $ 8.67                                                                                                                                                                         Cellular: Number of        925         1,041        948         1,052       1,070    activations Revenue from cellular        $ 195        $ 275         $ 314        $ 286        $ 277      services (000's)                                                                                   (a) Slight variations in totals are due to rounding.                                                        USA MOBILITY, INC. 2013 FINANCIAL GUIDANCE                                                                                                      (In millions)                                                                                                      Guidance Range                                        From                  To Revenues Wireless                               $    140              $    150 Software                                   55                   63 Combined                               $    195              $    213                                                               Operating Expenses (a) Wireless                               $    99               $    92 Software                                   53                   58 Combined                               $    152              $    150                                                               Capital Expenses Wireless                               $    9.5              $    7.5 Software                                   0.2                  0.6 Combined                               $    9.7              $    8.1                                                               (a) Operating expenses exclude depreciation, amortization and accretion.  Contact:  USA Mobility, Inc. Bob Lougee, 800-611-8488 bob.lougee@usamobility.com