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Thursday May 6, 6:59 am Eastern Time
Company Press Release
SOURCE: Internet America, Inc.
Internet America, Inc. Reports Third Quarter Results
Subscriber Count Up 34%; Revenue Increases 24% From
Same Period Last Year
DALLAS, May 6 /PRNewswire/ -- Internet America, Inc. (Nasdaq: GEEK - news) today announced results for its third fiscal quarter ended
March 31, highlighted by strong growth in subscriber count and revenue driven by acquisitions and internal growth. The Company reported
total revenue of $4.8 million for the quarter, an increase of 24% from the same period a year ago.
Internet America's subscriber count was 79,000 at March 31, 1999, a 34% increase from the subscriber count at March 31, 1998. The Company
reported a net loss of $709,000, or $0.10 per share, for the third fiscal quarter compared to a loss of $326,000, or $0.08 per share, for the same
period a year ago.
Current and historical financial results reported by Internet America have been restated as required by ''pooling-of-interests'' accounting to
include the results of operations and financial positions of CompuNet and CyberRamp, Internet service providers acquired by Internet
America during the quarter.
THIRD QUARTER HIGHLIGHTS:
* Subscriber count of 79,000 resulting in 34% year to year subscriber
growth.
* Total revenue of $4.8 million resulting in 24% year to year revenue
growth.
* Acquisition of CyberRamp, a Dallas-based Internet service provider
with 16,000 subscribers.
* Acquisition of CompuNet, a Dallas-based Internet service provider
with a high concentration of business clients.
* Increase of 25,500 subscribers for the quarter arising from the
acquisitions of CompuNet and CyberRamp (17,700 subscribers) and
internal growth (7,800 subscribers).
* Introduction of dial-up service in San Antonio and Austin, bringing
Internet America's fast, reliable service to the fourth and fifth
largest markets in Texas.
* Increase in sales and marketing expense to $2.1 million,
up $1.5 million from the same period a year ago, due to the Company's
aggressive advertising campaigns and entry into new markets.
* Legal, accounting and other acquisition costs of $250,000 relating
to the acquisitions of CompuNet and CyberRamp were expensed
during the quarter.
Mike Maples, president and chief executive officer of Internet America, commented ''our mission is to rapidly build market share, expand
aggressively into new markets and take advantage of acquisition opportunities. That is exactly what we accomplished, and we expect to
deliver this kind of performance in the future.''
Internet America completed its initial public offering on December 10, 1998, when the Company and certain shareholders sold 2.3 million
shares of common stock to the public. In January 1999, the Company's underwriters exercised their overallotment option and purchased an
additional 345,000 shares from the selling shareholders.
Based in Dallas, Internet America (www.airmail.net) is a leading Internet Service Provider in the southwestern United States with over 79,000
subscribers at March 31, 1999. Through its 1-800-Be-A-Geek® television campaigns that emphasize the speed and quality of its Internet
services and its commitment to customer care, Internet America has become one of the leading Internet service providers in its markets.
Internet America offers a wide array of Internet services tailored to meet the needs of individual consumers, including Expresslane DSL,
dial-up Internet access, multiple e-mail addresses, World Wide Web access, chat, Usenet News and personal web sites. Internet America also
provides a full range of services to business customers, including dedicated high-speed access, web hosting, server co-location and domain
name registration.
This press release may contain forward-looking statements relating to future financial results or business expectations and, as a result,
should be considered as subject to the many uncertainties that exist in the Company's operations and business environment. Business plans
may change as circumstances warrant and actual results may differ materially as a result of a number of factors. Such factors include, but are
not limited to: the Company's expansion and acquisition strategy, the Company's ability to achieve operating efficiencies, the Company's
dependence on network infrastructure, capacity, telecommunications carriers and other suppliers, industry pricing and technology trends,
evolving industry standards, regulatory changes, and general economic and business conditions. These risk factors and additional
information are included in the Company's filings with the Securities and Exchange Commission, including its prospectus dated December 9,
1998, and its Form 10-Q for the quarter ended December 31, 1998.
Internet America, Inc.
(Nasdaq: GEEK - news)
Financial Summary
(restated, unaudited, in thousands, except per share data and member count)
Three Months Ended Nine Months Ended
3/31/98 3/31/99 3/31/98 3/31/99
Members (restated) 59,100 79,000
Access revenue 3,275 4,221 8,905 11,436
Business services revenue 545 500 1,454 1,620
Other revenue 25 35 54 80
Total revenue 3,845 4,756 10,413 13,136
Connectivity and
operations 2,058 2,036 5,411 6,359
Sales and marketing 628 2,141 1,120 4,234
General & administrative 820 1,057 2,199 2,824
Depreciation and
amortization 469 428 1,305 1,405
Interest income (expense) (191) 197 (524) 36
Income tax expense 6 --- 18 10
Net income (loss) (326) (709) (164) (1,660)
Basic earnings (loss)
per share $(0.08) $(0.10) $(0.04) $(0.33)
Weighted average shares
-- basic 3,914,856 6,762,294 3,914,856 5,081,299
Fully diluted earnings
(loss) per share $(0.08) $(0.10) $(0.04) $(0.33)
Weighted average shares
-- fully diluted 3,914,856 6,762,294 3,914,856 5,081,299
Current assets 882 17,563
Property and
equipment, net 2,097 2,085
Subscriber acquisition
costs 768 306
Other assets 159 173
Total assets 3,906 20,127
Current liabilities 9,558 7,279
Long-term capital
lease obligations 292 32
Long-term debt 615 297
Total liabilities 10,465 7,608
Total stockholders'
equity (deficit) (6,558) 12,519
Total liabilities and
stockholders' equity 3,906 20,127
SOURCE: Internet America, Inc.
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