Syniverse Holdings, Inc. (NYSE:SVR), a leading provider of
mission-critical technology services to wireless telecommunications
companies worldwide, today reported results for first quarter 2006.
-- Total revenues were $75.4 million for the first quarter 2006, a
5.0% decrease compared to the first quarter 2005. -- Net revenue,
which excludes off-network database queries or pass-thru revenue,
was $73.4 million for the first quarter 2006, a decrease of 4.2%
compared to the first quarter 2005. -- Net income attributable to
common stockholders was $3.6 million in the first quarter 2006,
compared to a loss of $21.1 million in the first quarter 2005. --
Cash net income, a non-GAAP measure of profitability, was $11.4
million for the first quarter 2006, a 12.8% decrease compared to
the first quarter 2005. Cash net income reflects the positive cash
impact resulting from the significant difference in amortization of
goodwill for financial reporting and tax purposes and is determined
by adding the cash savings arising from the tax deductible goodwill
amortization to adjusted net income. -- Assuming all post-IPO
shares were outstanding in each of the two quarters, cash net
income per share was $0.17 in the first quarter 2006, compared to
$0.19 the first quarter 2005. -- Adjusted EBITDA, a non-GAAP
measure of operating cash flow, was $26.8 million for the first
quarter 2006, a 19.0% decrease compared to the first quarter 2005.
"During the quarter, we continued our gains in the European market.
We signed Telia Sonera to a group-wide contract which covers seven
operators in different countries across Northern Europe, and we
began migrating Vodafone properties to our platform. We have now
successfully implemented five of the Vodafone properties and have
scheduled the majority of the remaining subsidiaries for migration
by year-end," said Syniverse President and CEO Tony Holcombe. "Our
strategic focus as a company remains to grow our customer base
internationally, maintain our current North American market share
and expand our service offerings to existing and new customers. To
lead our efforts, I am pleased to announce that at quarter-end,
Nancy J. White joined Syniverse as chief marketing officer," said
Holcombe. "Nancy brings significant sales, marketing and business
development experience, as well as dynamic leadership skills gained
throughout a 20-year successful career in telecommunications. Nancy
will focus on our global marketing and product development
strategy, while also leading our North American and Central/Latin
American sales teams." Chief Financial Officer Ray Lawless added,
"During the first quarter, we exceeded our revenue guidance, and
met our adjusted EBITDA and cash net income guidance. We expect to
see continued improvements in all significant financial metrics
through the year as newly signed customers come on line." "We have
nearly completed our corporate headquarters move, which will result
in improvements in our technology infrastructure and business
continuity plans," said Lawless. Expenses related to the move in
the first quarter were $4.3 million, with the final costs related
to our move to be recognized in the second quarter of 2006." First
Quarter 2006 Service Line Revenue Technology Interoperability
Services Technology Interoperability revenue was $25.8 million in
the first quarter 2006, an 11.4% increase compared to first quarter
2005, primarily driven by increases in GSM clearing, Message
Manager and UniRoam. Network Services Network Services revenue was
$31.5 million in the first quarter 2006, a 2.3% decrease compared
to first quarter 2005, primarily driven by competitive pricing and
previously disclosed migrations, partially offset by increases in
GSM transport and other SS7 services. Number Portability Services
Number Portability revenue was $6.7 million in the first quarter
2006, a 42.3% decrease compared to the first quarter 2005,
primarily driven by the previously disclosed migration of the
Sprint port center. Call Processing Services Call Processing
Services revenue was $7.2 million in the first quarter 2006, a
12.3% increase compared to the first quarter 2005, primarily driven
by increases in international roaming supported by Signaling
Solutions. Enterprise Solutions Enterprise Solutions revenue was
$2.1 million in the first quarter 2006. Off-Network Database
Queries (Pass-Thru) Pass-thru revenue for the first quarter 2006
was $2.0 million. First Quarter 2006 Business Highlights Key
customer contract wins: -- Secured a contract with Telia Sonera to
provide GSM clearing and settlement services -- Renewed clearing
and settlement contract with Alltel -- Re-signed SunCom Wireless
for clearing and settlement services -0- *T Outlook ------- The
company provides the following estimates for 2006: Second Quarter
Full Year Net Revenues $76 million - $78 million $330 million -
$340 million Adjusted EBITDA $28 million - $30 million $135 million
- $145 million Cash Net Income $11 million - $13 million $60
million - $70 million *T Non-GAAP Measures Syniverse's Cash Net
Income is determined by adding the cash benefit of our
tax-deductible goodwill to Adjusted Net Income. This benefit is a
result of the differing treatments of approximately $362 million of
goodwill on our balance sheet created primarily from our
acquisitions from Verizon and of IOS North America. While not
amortized for GAAP purposes, goodwill amortization is deductible in
calculating our taxable income and hence reduces cash tax
liabilities. Syniverse's Adjusted Net Income is determined by
adding the following to net income (loss): provision for income
taxes, restructuring costs, amortization of intangibles recorded in
purchase accounting, loss on extinguishment of debt, headquarters
facilities move expenses, transition expenses of integrating the
IOS North America business and less the gain on the sale of
securities to arrive at Adjusted Net Income (loss) before provision
for income taxes. This adjusted pre-tax result is then further
adjusted for a provision for income taxes at an assumed long-term
tax rate of 39%, which excludes the effect of our NOLs. We present
Adjusted Net Income and Cash Net Income because we believe that
Adjusted Net Income and Cash Net Income provide useful information
regarding our operating results, in addition to our GAAP measures.
We believe that Adjusted Net Income provides our investors with
valuable insight into our profitability exclusive of unusual
adjustments, and Cash Net Income provides further insight into the
cash impact resulting from the different treatments of goodwill for
financial reporting and tax purposes. Neither of these non-GAAP
measures should be reviewed without consideration of our net income
and other GAAP measures. Syniverse's Adjusted EBITDA is determined
by adding the following to net income (loss): net interest expense,
provision for income taxes, depreciation, amortization,
restructuring charges, loss on extinguishment of debt, headquarters
facilities move expenses, the transition expenses of integrating
the IOS North America business and less the gain on the sale of
marketable securities. A reconciliation of Adjusted EBITDA,
Adjusted Net Income and Cash Net Income to net income (loss) is
presented in the financial tables contained herein. We present
Adjusted EBITDA because we believe that Adjusted EBITDA provides
useful information regarding our continuing operating results. We
rely on Adjusted EBITDA as a primary measure to review and assess
the operating performance of our company and our management team in
connection with our executive compensation and bonus plans. We also
review Adjusted EBITDA to compare our current operating results
with corresponding periods and with the operating results of other
companies in our industry. In addition, we also utilize Adjusted
EBITDA as an assessment of our overall liquidity and our ability to
meet our debt service obligations. We believe that Adjusted EBITDA,
Adjusted Net Income and Cash Net Income are useful to investors to
provide disclosures of our operating results on the same basis as
that used by our management. We also believe that these measures
can assist investors in comparing our performance to that of other
companies on a consistent basis without regard to certain items,
which do not directly affect our ongoing operating performance or
cash flows. Adjusted EBITDA, Adjusted Net Income and Cash Net
Income have limitations as analytical tools, and you should not
consider them in isolation, or as a substitute for net income, cash
flows from operating activities and other consolidated income or
cash flows statement data prepared in accordance with accounting
principles generally accepted in the United States. Because of
these limitations, Adjusted EBITDA should not be considered a
measure of discretionary cash available to us to invest in the
growth of our business, and Adjusted Net Income and Cash Net Income
should not be considered as a replacement for net income. We
compensate for these limitations by relying primarily on our GAAP
results and using Adjusted EBITDA, Adjusted Net Income and Cash Net
Income as supplemental information. First Quarter 2006 Earnings
Call Syniverse Technologies will release first quarter 2006 results
after the market closes on Thursday, April 27, 2006 and host a
conference call at 4:30 p.m. (ET) to discuss these results. To
participate on this call, please dial 1 (800) 320.2978 (for U.S.
callers) or +1 (617) 614.4923 (international direct dial). The pass
code for this call is 51323592. This event will be Webcast live
over the Internet in listen-only mode at
http://www.syniverse.com/investorevents. A replay of this call will
be available beginning Thursday, April 27, 2006 at 6:30 p.m. (ET)
through Thursday, May 4, 2006, 8:00 p.m. (ET). To access the
replay, please dial 1 (888) 286.8010 (for U.S. callers), or +1
(617) 801.6888 (international direct dial). The replay pass code is
61160950. In addition, this earnings call will be archived on the
Syniverse Technologies corporate Web site http://www.syniverse.com
under Investors - Webcasts and Presentations. About Syniverse
Syniverse Technologies (NYSE:SVR) is a leading provider of
mission-critical technology services to wireless telecommunications
companies worldwide. Syniverse solutions simplify technology
complexities by integrating disparate carriers' systems and
networks in order to provide seamless global voice and data
communications to wireless subscribers. Carriers depend on
Syniverse's integrated suite of services to solve their most
complex technology challenges and to facilitate the rapid
deployment of next generation wireless services. Syniverse provides
services to over 350 telecommunications carriers in more than 50
countries, including the ten largest U.S. wireless carriers and six
of the ten largest international wireless carriers. Headquartered
in Tampa, Fla., U.S.A., Syniverse has offices in major cities
throughout North America, The Netherlands, China, the United
Kingdom and a global sales force in Brazil, France, India, Italy,
Japan, Luxembourg, Norway, Singapore and Slovakia.
http://www.syniverse.com Cautions about Forward-Looking Statements
This press release contains forward-looking statements, including
statements about business outlook and strategy, and statements
about historical results that may suggest trends for our business.
These statements are based on estimates and information available
to us at the time of this press release and are not guarantees of
future performance. Actual results could differ materially from our
current expectations as a result of many factors, including:
unpredictable quarterly fluctuations in our business; the effects
of competition or consumer and merchant use of our service; any
adverse changes in our agreements with our listings providers; the
impact of international expansion efforts on our business; and
changes in our tax status. These and other risks and uncertainties
associated with our business are described in our filings with the
Securities and Exchange Commission. -0- *T Syniverse Holdings, Inc.
Condensed Consolidated Statements of Operations (unaudited) (In
thousands except per share information) Three Months Three Months
Ended Ended March 31, 2005 March 31, 2006 ---------------
-------------- Technology Interoperability Services $23,199 $25,837
Network Services 32,232 31,493 Number Portability Services 11,669
6,730 Call Processing Services 6,403 7,191 Enterprise Solution
3,082 2,130 --------------- -------------- Revenues excluding Off
Network Database Queries 76,585 73,381 Off Network Database Queries
2,834 2,036 --------------- -------------- Total Revenues 79,419
75,417 Cost of operations 32,426 31,206 ---------------
-------------- Gross Margin 46,993 44,211 Gross Margin % 59.2%
58.6% Gross Margin % before Off Network Database Queries 61.4%
60.2% Sales and marketing 5,662 5,493 General and administrative
10,154 17,311 Depreciation and amortization 11,885 9,981
Restructuring - 338 --------------- -------------- Operating income
19,292 11,088 Other expense, net Interest expense, net (10,165)
(6,108) Loss on extinguishment of debt (23,788) (924) Other, net -
119 --------------- -------------- (33,953) (6,913) ---------------
-------------- Income (loss) before provision for income taxes
(14,661) 4,175 Provision for income taxes 2,291 625 ---------------
-------------- Net income (loss) (16,952) 3,550 Preferred stock
dividends (4,195) - --------------- -------------- Net income
(loss) attributable to common stockholders $(21,147) $3,550
=============== ============== Net income (loss) per share Basic
$(0.43) $0.05 Diluted $(0.43) $0.05 IPO pro forma(1) $(0.25) $0.05
Shares used in calculation Basic 48,784 66,747 Diluted 48,784
67,262 IPO pro forma(2) 67,667 67,667 Notes: 1) Assumes no
preferred stock dividends since all of the outstanding preferred
stock was either redeemed or converted to common shares after our
IPO. 2) Assumes shares outstanding immediately after our IPO were
outstanding for the full period above. Selected Balance Sheet Data
(unaudited): As of (in thousands) March 31, 2006 ----------------
Cash $30,129 Senior subordinated notes $175,000 Term note B 177,875
---------------- Total debt $352,875 ================ Common stock
and additional paid-in capital $457,266 Accumulated deficit and
other comprehensive income (131,127) ---------------- Total
stockholders' equity $326,139 ================ *T -0- *T Syniverse
Holdings, Inc. Reconciliation of Non GAAP Measures to GAAP
(unaudited) (In thousands except per share information) Three
Months Three Months Ended Ended March 31, 2005 March 31, 2006
--------------- -------------- Reconciliation to adjusted EBITDA
Net income (loss) $(16,952) $3,550 Interest expense, net 10,165
6,108 Provision for income taxes 2,291 625 Depreciation and
amortization 11,885 9,981 Restructuring - 338 IOS North America
transition expenses 1,672 1,053 Facilities move expense 221 4,334
Loss on extinguishment of debt 23,788 924 Gain on sale of
marketable securities - (119) --------------- --------------
Adjusted EBITDA $33,070 $26,794 =============== ==============
Three Months Three Months Ended Ended March 31, 2005 March 31, 2006
-------------- -------------- Reconciliation to adjusted net income
(loss) and cash net income Net income (loss) $(16,952) $3,550 Add
provision for income taxes 2,291 625 -------------- --------------
Income (loss) before provision for income taxes (14,661) 4,175
Restructuring - 338 Purchase accounting amortization 6,432 4,227
IOS North America transition expenses 1,672 1,053 Facilities move
expense 434 4,334 Loss on extinguishment of debt 23,788 924 Gain on
sale of marketable securities - (119) -------------- --------------
Adjusted income before provision for income taxes 17,665 14,932
Less assumed provision for income taxes at 39% (6,889) (5,823)
-------------- -------------- Adjusted net income 10,776 9,109 Add
cash savings of tax deductible goodwill(1) 2,300 2,300
-------------- -------------- Cash net income $13,076 $11,409
============== ============== Adjusted net income per share after
IPO $0.16 $0.13 Cash net income per share after IPO $0.19 $0.17
Shares outstanding after IPO(2) 67,667 67,667 1) Represents the
cash benefit realized currently as a result of the tax
deductibility of goodwill amortization. 2) Assumes shares
outstanding immediately after our IPO were outstanding for all
periods above. *T
Syniverse Hlgs (NYSE:SVR)
Historical Stock Chart
From Jun 2024 to Jul 2024
Syniverse Hlgs (NYSE:SVR)
Historical Stock Chart
From Jul 2023 to Jul 2024