Jenna, what do you think of HSAC's report? Think it may move tomorrow? Thanks, Susan
High Speed Access Corp. Reports Third Quarter Results
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DENVER--(BUSINESS WIRE)--Nov. 2, 1999--
HSA Reports 79% Quarterly Growth in
Residential Cable Modem Subscribers
High Speed Access Corp. (NASDAQ:HSAC), a leading provider of
high-speed Internet access via cable modem to residential and
commercial end-users in exurban markets, today announced net revenue
of $1,070,000 for the third quarter ended September 30, 1999, an
increase of 959% over net revenue of $101,000 generated for the third
quarter ended September 30, 1998.
HSA's residential cable modem subscribers increased 79% from
5,195 at June 30, 1999 to 9,307 at the end of the third quarter. As of
September 30, 1999, HSA and its cable partners are now deployed to
deliver high-speed Internet access to more than 1.5 million homes
passed, a 76% increase for the quarter. HSA currently has the right to
offer services to approximately 1.9 million homes passed under
existing contracts or letters of intent. These totals do not include
approximately 10 million potential homes passed under equity
incentive-based agreements with Charter Communications, Road Runner,
Classic Cable and Cable Management Associates.
*T
June 30 Sept. 30
1999 1999
--------- ---------
Homes under contract
or letter of intent 1,600,000 1,900,000
Homes deployed 850,000 1,500,000
Subscribers:
Residential 5,195 9,307
Commercial 428 528
Dial up 5,259 5,813
The net loss available to common stockholders for the quarter was
$14.3 million, or 26 cents per share, compared with a net loss
available to common stockholders of $11.1 million, or $1.79 per share,
for the quarter ended September 30, 1998. (See Attached Unaudited
Condensed Consolidated Statements of Operations)
The net loss before certain non-cash charges for the current
quarter was $13.8 million, or a pro forma net loss before non-cash
charges of 26 cents per share. This compares with a net loss of $3.3
million before non-cash charges for the quarter ended September 30,
1998 or a pro forma net loss before non-cash charges of 25 cents per
share.
Non-cash charges for the third quarter of 1999 included $18,000
of non-cash compensation expense from the issuance of stock options,
$193,000 for the amortization of distribution agreement costs and
$268,000 of amortization of goodwill and other intangible assets.
Non-cash charges for the amortization of distribution agreement costs
during the quarter related to the issuance of warrants to strategic
partners. From time to time, HSA will incur these charges as strategic
partners earn the right to purchase additional shares and HSA is
provided with additional homes passed. For the third quarter of 1998,
non-cash charges included $216,000 for the amortization of goodwill
and other intangible assets.
For the nine months ended September 30, 1999, HSA reported net
revenue of $2.0 million and a net loss available to common
stockholders of $267.9 million, or $10.10 per share. The net loss
available to common stockholders for the nine months ended September
30, 1999 includes a $229.1 million non-cash charge to accumulated
deficit to increase the carrying value of the company's previously
outstanding preferred stock to its redemption value at the time of its
IPO. The net loss before certain non-cash charges for the nine months
ended September 30, 1999 was $30.7 million, or a pro forma net loss
before non-cash charges of 75 cents per share. Non-cash charges for
the first nine months of 1999 included $2.7 million of non-cash
compensation expense from the issuance of stock options, $3.5 million
for the amortization of distribution agreement costs and $740,000 of
amortization of goodwill and other intangible assets.
"Our excellent subscriber growth this quarter demonstrates HSA's
customer focus in the exurban market, as well as the results of an
aggressive deployment schedule to date" said Ron Pitcock, the
company's co-founder and President. "I am extremely proud of our
accomplishments as we continue to execute our strategy as indicated by
the growth in homes passed and market deployments in conjunction with
our cable partners. Clearly, we are now beginning to reap the benefits
of our efforts and have strong momentum moving into the final quarter
of the year."
About High Speed Access Corp.
High Speed Access Corp. (www.hsacorp.net) is a leading provider
of high speed Internet access via cable modem to residential and
commercial end users in exurban areas. The company believes that it
provides the most comprehensive turnkey solution available to the
cable operator. Its service enables subscribers to receive Internet
access at speeds substantially faster than traditional Internet access
at minimal cost to the cable operator. High Speed Access Corp. enters
into long term exclusive contracts with cable operators to provide
them with the company's services. The company pays its cable partners
a portion of the monthly fees it receives from the end users in
exchange for the opportunity to access and provide service to the
cable partner's subscribers.
This press release contains statements about future events and
expectations, which are "forward-looking statements." Any statement in
this press release that is not a statement of historical fact may be
deemed to be a forward-looking statement. Such forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the company's actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Specific factors that might cause such a
difference include, but are not limited to: the company's unproven
business model; the company's history of losses and anticipation of
future losses; the potential fluctuations in the company's operating
results; the company's competition; the company's potential inability
to attract and retain end users; the company's potential inability to
establish or maintain relationships with cable operators, including
Charter; the possibility that the company's contract with Road Runner
may not benefit it; and those risks and uncertainties discussed in
filings made by the company with the Securities and Exchange
Commission, including those risks and uncertainties contained under
the heading "Risk Factors" in the company's most recent quarterly
report on Form 10-Q as filed with the Securities and Exchange
Commission.
(Tables to follow)
High Speed Access Corp.
Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Three Months Nine Months
Ended Ended Ended April 3, 1998
Sept. 30, Sept. 30, Sept. 30, (Inception)
1999 1998 1999 to Sept. 30,
1998
----------------------------------------------------
Net Revenue $ 1,070 $ 101 $ 2,010 $ 192
Costs and expenses:
Operating 7,194 673 13,344 934
Engineering 2,547 705 6,103 1,103
Sales and Marketing 5,126 1,434 10,783 2,091
General and
Administrative 3,019 784 6,666 1,348
Non-cash compensation
expense from stock
options 18 - 2,698 -
Amortization of distribution
agreement costs 193 - 3,498 -
------- ------ ------- ------
Total costs and
expenses 18,097 3,596 43,092 5,476
------- ------ ------- ------
Loss from operations (17,027) (3,495) (41,082) (5,284)
Interest income 2,824 9 3,684 10
Interest expense (122) (20) (216) (25)
------- ------ ------- ------
Net loss (14,325) (3,506) (37,614) (5,299)
Mandatorily redeemable
convertible preferred
stock dividends - (85) (1,122) (109)
Accretion of redemption
value of mandatorily
redeemable convertible
preferred stock - (7,500) (229,148) (7,500)
------- ------ ------- ------
Net loss available
to common
stockholders $ (14,325) $ (11,091) $ (267,884) $ (12,908)
========= ========= ========== =========
Basic and diluted net
loss available to common
stockholders per
share $ (0.26) $ (1.79) $ (10.10) $ (2.08)
========= ========= ========== =========
Weighted average shares
used in computation of
basic and diluted net
loss available to
common stockholders per
share 54,141,481 6,200,000 26,526,365 6,200,000
Supplemental Information:
Net loss before non-cash
charges:
Net loss including
non-cash charges $ (14,325) $ (3,506) $ (37,614) $ (5,299)
Non-cash charges:
Compensation expense
from stock options 18 - 2,698 -
Amortization of
distribution agreement
costs 193 - 3,455 -
Amortization of
Intangible assets 268 216 740 432
------- ------ ------- ------
Net loss before
non-cash charges $ (13,846) $ (3,290) $ (30,721) $ (4,867)
========= ========= ========== =========
Pro forma basic and
diluted net loss
before non-cash
charges (1) $(0.26) $ (0.25) $ (0.75) $ (0.45)
========= ========= ========== =========
Weighted average shares
used in computation of
pro forma basic and
diluted net loss before
non-cash
charges (1) 54,141,481 13,234,810 41,203,105 10,861,194
(1) Assumes conversion of mandatorily redeemable convertible
preferred stock into common stock at the beginning of the period
or at issuance, whichever is earlier.
*T
CONTACT: High Speed Access Corp.
INVESTOR CONTACT:
Stephen Calk, VP of Investor Relations
303/256-2091
scalk@hsacorp.net
or
High Speed Access Corp.
MEDIA CONTACT:
Katina Vlahadamis, Director of Media Relations
303/256-2018
kvlahadamis@hsacorp.net
KEYWORD: COLORADO
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS INTERNET NETWORKING
EARNINGS
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