Proshares Ultrashort Telecommunications (AMEX:TLL)
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Teletouch Communications, Inc. (AMEX:TLL) today reported
on financial information relating to its results filed on Form 10-Q
for the second quarter ended November 30, 2005. Total revenues for the
second quarter of fiscal 2006 declined approximately 14.8% to $5.43
million compared with $6.37 million in the second quarter of fiscal
2005. Cash and Cash Equivalents declined to approximately $0.94
million at the end of the second quarter compared with $1.28 million
at the 2005 fiscal year ended, May 31, 2005, although Net Cash from
Operating Activities was positive and slightly improved at $0.20
million in the second quarter, over the $0.18 reported for the first
quarter of fiscal 2006. The Company recorded a net loss of
approximately $0.12 million, or $0.01 loss per share in the second
quarter fiscal 2006, versus a higher net loss of $0.36 million, or
$0.08 loss per share in the comparable quarter of fiscal 2005.
Reporting on a segment basis, total Paging revenues for the second
quarter declined approximately 19.4% to $3.84 million compared with
$4.76 million in the prior-year period, in line with the Company's
estimates. Pagers in service declined to approximately 125,500 for the
six months ended November 30, 2005, compared with 169,400 at November
30, 2004. Two-way radio service and product sales were down 2.7% to
$1.44 million in the quarter, from $1.48 million in the comparable
2005 quarter. The decline was due primarily to a reduction in and the
timing of hardware product sales; service revenues increased during
the current period. Total Other service and product revenues increased
approximately 14.4% to $0.15 million in the second quarter of 2006,
compared to $0.13 million through the same period in 2005.
The Company significantly reduced its operating loss 95% to $0.02
million for the second quarter of fiscal 2006, from a loss of $0.46
million in the prior year period. The reduction in operating loss was
primarily due to continued cost reductions across all departments in
the Company and lower depreciation expense related to certain paging
assets that fully depreciated in the quarter.
Discussing the second quarter results, Teletouch CEO, T. A. "Kip"
Hyde, Jr. stated, "Teletouch is now showing significant operating and
financial improvement from both the Company's direct actions to
control expenses, and the restructuring activities related to the
transition and preparation for sale of the paging business. As
previously announced, the Company filed its preliminary Proxy for a
Special Shareholders Meeting with the SEC, which in its current form
asks Teletouch shareholders to approve the sale of the core paging
business assets. The special shareholders' meeting is tentatively
scheduled for March 1, 2006. If the sale is approved, we are prepared
and would expect to close the transaction shortly following the
special meeting."
Hyde concluded, "We plan to use the proceeds from the sale of the
paging business to acquire one or more currently identified companies
that each offer significant revenue, EBITDA and/or net income growth
opportunities. We are currently in discussions with a number of
acquisition targets and are actively looking to identify others. Once
the final disposition of the paging business sale is made clear by the
shareholders' vote, we will be better prepared to move forward on this
front, as well."
About Teletouch
Teletouch offers telemetry and GPS-location based mobile asset
monitoring, cellular, two-way radio communications and wireless
messaging services throughout the United States. Teletouch's common
stock is traded on the American Stock Exchange under stock symbol:
TLL. Additional business and financial information on Teletouch is
available at www.Teletouch.com.
All statements in this news release that are not based on
historical fact are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995 and the
provisions of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended
(which Sections were adopted as part of the Private Securities
Litigation Reform Act of 1995). While management has based any
forward-looking statements contained herein on its current
expectations, the information on which such expectations were based
may change. These forward-looking statements rely on a number of
assumptions concerning future events and are subject to a number of
risks, uncertainties, and other factors, many of which are outside of
our control, that could cause actual results to materially differ from
such statements. Such risks, uncertainties, and other factors include,
but are not necessarily limited to, those set forth under the caption
"Additional Factors That May Affect Our Business" in the Company's
most recent Form 10-K and 10-Q filings, and amendments thereto. In
addition, we operate in a highly competitive and rapidly changing
environment, and new risks may arise. Accordingly, investors should
not place any reliance on forward-looking statements as a prediction
of actual results. We disclaim any intention to, and undertake no
obligation to, update or revise any forward-looking statement.
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*T
TELETOUCH COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except shares and per share amounts)
Three Months Ended Six Months Ended
November 30, November 30,
---------------------- ---------------------
2005 2004 2005 2004
----------- ---------- ----------- ---------
Operating revenues:
Service, rent, and
maintenance revenue $4,241 $5,094 $8,820 $10,436
Product sales revenue 1,186 1,279 2,105 2,382
----------- ---------- ----------- ---------
Total operating
revenues 5,427 6,373 10,925 12,818
----------- ---------- ----------- ---------
Operating expenses:
Cost of service, rent
and maintenance
(exclusive of
depreciation and
amortization included
below) 2,361 2,737 5,012 5,519
Cost of products sold 768 1,205 1,441 2,203
Selling and general
and administrative 1,818 2,056 3,548 4,027
Depreciation and
amortization 503 829 1,264 1,734
Loss (gain) on
disposal of assets (1) 3 (2) (51)
----------- ---------- ----------- ---------
Total operating
expenses 5,449 6,830 11,263 13,432
----------- ---------- ----------- ---------
Operating loss (22) (457) (338) (614)
Interest expense, net (100) (108) (215) (211)
----------- ---------- ----------- ---------
Loss before income tax
benefit (122) (565) (553) (825)
Income tax benefit - (201) - (239)
----------- ---------- ----------- ---------
Net loss $(122) $(364) $(553) $(586)
=========== ========== =========== =========
Basic and diluted loss per
share $(0.01) $(0.08) $(0.05) $(0.13)
=========== ========== =========== =========
Weighted average number of
common shares
outstanding(1) 18,844,548 4,546,980 11,824,400 4,546,980
=========== ========== =========== =========
(1) 48,735,495 Total common shares outstanding as of the January 9,
2006 filing date.
*T
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*T
TELETOUCH COMMUNICATIONS, INC.
Selected Balance Sheet Highlights
(In thousands)
November 30, May 31,
2005 2005
------------- ----------
Cash and cash equivalents $942 $1,283
Current portion of long-term debt and
redeemable common stock obligations 335 426
Long-term debt and redeemable common stock
obligations, net of current portion 2,388 2,290
*T