Alarmguard Holdings, Inc. Reports Second Quarter 1998 Results
ORANGE, CT--(BUSINESS WIRE)--August 11, 1998--Alarmguard Holdings, Inc. (AMEX: AGD) today reported its results for the second quarter and six months ended June 30, 1998.
For the quarter, revenues increased 56.5% to $13.1 million, compared with $8.4 million in the second quarter of 1997. Earnings before interest, taxes, depreciation and amortization ("EBITDA") of $1.6 million compared to $0.8 million in the comparable period in the prior year. The Company's net loss applicable to common shares was $5.0 million, or $0.89 per share, compared with a net loss of $4.3 million, or $0.89 per share, in the year-ago period.
For the six months, revenues increased 60.4% to $24.0 million, compared with $15.0 million in the same period in 1997. EBITDA of $2.8 million compared to $1.5 million in the comparable period in the prior year. The Company's net loss applicable to common shares was $9.1 million, or $1.63 per share, compared with a net loss of $6.9 million, or $1.81 per share, in the year-ago period.
The increase in net loss for the quarter and six months is primarily attributable to increased amortization expense associated with the Company's growth and acquisition initiatives, as well as higher interest expense associated with increased borrowings used to finance internal growth and acquisitions.
Alarmguard employs three internal measurements to assess its growth and the performance of operations: (1) Monthly Recurring Revenue ("MRR"), a key measure of growth; (2) Adjusted EBITDA (see financial table), which compares companies that grow both internally and through acquisitions with those that grow primarily through acquisitions; and, (3) Gross MRR attrition. MRR was approximately $3.0 million at June 30, 1998, versus $2.9 million at March 31, 1998, and $2.1 million at June 30, 1997. Adjusted EBITDA increased 74.8% to $2.5 million for second quarter 1998 from $1.4 million in second quarter 1997. Gross MRR attrition was 11.7% for the twelve months ended June 30, 1998, versus 11.8% for the twelve months ended December 31, 1997.
Russell R. MacDonnell, Chairman and Chief Executive Officer, said, "We continued our strong performance in the second quarter. We completed the quarter with approximately 95,000 subscribers, up from approximately 64,000 at year-end, reflecting growth due to acquisitions, as well as the impact of our internal growth programs. Our dealer and direct marketing programs continue to produce excellent results, adding approximately 4,000 customers during the second quarter."
Mr. MacDonnell added, "This was the first quarter in which the full results of Sentry Protective Systems and Pelletier Alarm Services, two significant acquisitions that we completed during the first quarter, were included in our operating results. During the second quarter, we realized significant cost savings as we moved to fully integrate these acquisitions, as evidenced by the increase in adjusted EBITDA to $2.5 million in the second quarter from $1.9 million in the first quarter. Also, on July 31, we repaid $3.9 million of subordinated debentures with a new term loan provided to us by certain banks under our credit facility, which will result in reduced interest expense going forward."
Alarmguard, with approximately 95,000 subscribers and about $3.0 million of MRR, sells and installs burglar and fire systems and provides security monitoring services and security system repair and maintenance services to homeowners and businesses, principally in the Northeast and Mid-Atlantic regions of the United States. Alarmguard provides its security alarm systems and services primarily under its trademark "Alarmguard". |
