OKLAHOMA CITY, March 5, 2003 (PRIMEZONE) -- Dobson Communications Corporation (Nasdaq:DCEL):
-- Net Income Was $8.3 Million, Compared with Net Loss in 4Q 2001 --
-- EBITDA Increased 18 Percent to $70.2 Million --
-- $179 Million of Preferred Stock and Debt Repurchased Since
September 1, 2002 --
-- Dobson Ended 2002 with $295 Million Cash Position --
Dobson Communications Corporation reported net income of $8.3 million for its fourth quarter ended December 31, 2002, compared with a net loss of $29.4 million for the final quarter of the previous year. Net income for the fourth quarter of 2002 included non-cash income tax expense of $5.3 million (Table 1).
Dobson recorded net income applicable to common shareholders for the final quarter of $25.6 million, which included non-cash dividends of $22.8 million on preferred stock and a gain of $40.1 million for the excess of carrying value over the repurchase price of preferred stock. This $40.1 million reflected the repurchase, through a subsidiary of Dobson Communications, of $66.6 million (liquidation preference amount) of its 12.25% and 13% Senior Exchangeable Preferred Stock during the fourth quarter. Please see "Debt and Preferred Stock Obligations Reduced" below.
For the fourth quarter of 2001, Dobson recorded a $52.3 million net loss applicable to common shareholders, which was based on a net loss of $29.4 million and non-cash dividends of $22.9 million on preferred stock. Dobson's fourth quarter 2001 net loss of $29.4 million also included a charge of $16.7 million, net of taxes, for amortization of licenses. Licenses are not amortized in 2002 results due to the adoption of SFAS No. 142.
Dobson's EBITDA was $70.2 million for the fourth quarter of 2002, an 18 percent increase over last year's fourth quarter EBITDA of $59.5 million. This strong increase reflected an EBITDA margin of 44.0 percent of total revenue in the fourth quarter, compared with 39.7 percent for the same quarter last year. Higher profitability in its local service business helped the Company's margins in the fourth quarter, along with lower sales volumes that reduced variable sales and marketing expenses.
EBITDA represents earnings before interest, taxes, depreciation, amortization, loss from investment in joint venture, income (loss) from discontinued operations, loss from change in accounting principle and income from extraordinary items.
Dobson's reported 58,200 gross subscriber additions for the fourth quarter of 2002, compared with 65,000 for the same quarter last year. Net subscriber additions for the quarter of 18,900, reflecting customer churn of 1.8 percent. For the fourth quarter last year, Dobson reported 30,400 total net subscriber additions and churn of 2.1 percent.
The Company reported total revenue of $159.4 million for the fourth quarter ended December 31, 2002, an increase of 6 percent over total revenue of $150.1 million for the same quarter of the previous year. Local service revenue increased 11 percent to $94.8 million, compared with $85.4 million for the fourth quarter last year.
Fourth quarter roaming revenue declined slightly to $59.7 million from $59.9 million in the fourth quarter of 2001. Roaming traffic on the Dobson network was approximately 36 percent higher in the fourth quarter of 2002 than it was in the same period last year, offset by expected declines in roaming yields in 2002.
In the fourth quarter, Dobson continued to sell a high percentage of calling plans that concentrate call traffic on its network and those of its major roaming partners. Sales of local and preferred network calling plans accounted for 69 percent of gross subscriber additions.
Average revenue per unit (ARPU) for the fourth quarter of 2002 of approximately $43, in line with ARPU for the same quarter last year.
The Company continued to reduce cash cost per unit (CCPU) on a year-over-year basis. In the fourth quarter of 2002, CCPU was approximately $21, down from $23 for the same period last year, despite average customer minutes of use (MOUs) increasing almost 20 percent in the most recent quarter. CCPU reflects local operating costs and excludes the costs of subscriber acquisition and costs associated with the Company's roaming, or wholesale, business. Consequently, Dobson's fourth quarter EBITDA margin on its local service revenue rose to 23.7 percent, compared with 13.6 percent for the same quarter last year.
Capital expenditures were approximately $18.8 million in the fourth quarter, bringing total 2002 capital expenditures to $83.9 million.
At December 31, 2002, Dobson had $294.5 million in unrestricted cash (Table 2) and approximately $14.2 million in restricted cash in escrow related to the four properties it sold to Verizon. However, approximately $7.1 million was released from escrow in February 2003 and, as required, was used to pay down Dobson credit facilities. At the end of the quarter, Dobson had approximately $125 million in available borrowing capacity under its subsidiaries' credit facilities.
Debt and Preferred Stock Obligations Reduced
From the inception of its repurchase program to date, Dobson has repurchased a total of approximately $168 million (liquidation preference amount) of its preferred stock. Of this amount, the Company repurchased $41.1 million in the third quarter of 2002, $66.6 million in the fourth quarter, and $59.9 million in the first quarter of 2003, at a costs of $10.9 million, $27.8 million and $36.4 million respectively.
Dobson also repurchased $11.5 million (principal value) of 12.25% Dobson/Sygnet Senior Notes in the third quarter, at a cost of $8.9 million.
The attached "Selected Financial Data" (Table 2) reflects the cancellation of $107.7 million in preferred stock that was repurchased prior to year-end 2002, along with $1.3 million in dividends. The effects of the $59.9 million in preferred stock that was repurchased in the first quarter of 2003 will be reflected on the March 31, 2003 balance sheet when Dobson reports its first quarter.
Dobson's current balance sheet also continues to include $200 million in Dobson Series AA Preferred Stock, which is owned by AT&T Wireless. In December 2002, Dobson signed a definitive agreement to exchange its two properties in California for AT&T Wireless' two properties in Alaska. Upon completion of this agreement, AT&T Wireless has agreed to transfer to Dobson all of its outstanding Series AA preferred stock, which Dobson plans to cancel. Completion of the exchange remains subject to federal regulatory approvals and certain other conditions, as set out in the Asset Exchange Agreement.
"We are focused on strengthening our balance sheet by reducing overall leverage," said Everett R. Dobson, president, chairman and chief executive officer. "We began last year by selling four properties to Verizon Wireless and using the proceeds to reduce debt by $325 million. Since then we have repurchased another $168 million in preferred stock, which we have cancelled or will cancel at the end of the current quarter.
"Altogether since the beginning of 2002, we have reduced our net debt and PIK leverage multiple to 5.8X from 8.2X. This includes the reduction in Dobson's credit facility and all PIK and debt repurchases, and it assumes completion of the AT&T Wireless property swap," he said. "These balance sheet improvements will also save slightly more than $50 million annually in dividend and interest payments."
The Company may from time to time continue to repurchase preferred stock or senior notes in open market or privately negotiated transactions at prices that the Company deems appropriate.
Dobson CC Limited Partnership
As previously disclosed, Dobson's principal stockholder, Dobson CC Limited Partnership (DCCLP) has a credit agreement with Bank of America, N.A. DCCLP has pledged certain assets, including securities that represent controlling interests in DCCLP and in Dobson Communications, against the loan. The current term of the loan expires on March 31, 2003, unless extended. If the loan is not paid at maturity or if a default occurs under the loan agreements, and if the lender elects to foreclose on the collateral, Dobson could experience a change of control.
Upon a change of control, Dobson Communications and its subsidiary, Dobson/Sygnet Communications Company (Dobson/Sygnet), would be required to offer to purchase each of their outstanding senior notes at 101% of the principal amount, plus accrued and unpaid interest. In addition, Dobson Communications would be required to offer to purchase its outstanding senior preferred stock at 101% of the aggregate liquidation preference. There can be no assurance that the two entities would have the funds necessary to complete these repurchases.
If either failed to complete the purchases of the tendered senior notes, the note holders or their indenture trustees would be entitled to accelerate the maturity of the senior notes. If Dobson Communications failed to complete the purchase of its outstanding senior preferred stock, the holders of those two series of senior preferred stock would be entitled to elect two additional directors to Dobson's board of directors. The Dobson and Dobson/Sygnet credit facilities prohibit them from making the required offers to purchase.
A change of control would also constitute an event of default under the bank credit facilities of Dobson and Dobson/Sygnet, entitling the lenders to accelerate the maturity of credit facility debt.
Representatives of DCCLP are currently in discussions with Bank of America concerning a possible extension or restructuring of the loan. There can be no assurance that DCCLP will be successful in these discussions.
American Cellular Corporation
American Cellular reported a net loss applicable to common shareholders of $424.1 million for the quarter ended December 31, 2002, almost all of which was attributable to an impairment of goodwill of $423.9 million (Table 1, footnote, and Table 4). Under SFAS No. 142, wireless companies must re-evaluate at least annually the value of their licenses and goodwill related to acquisitions, recording charges if current values on licenses and properties have declined. American Cellular's impairment charge in the fourth quarter of 2002 did not impact Dobson, because Dobson had previously written off its investment in American in June 2002.
For the fourth quarter of 2001, American recorded a net loss of $37.0 million. This included a charge of $23.1 million, net of taxes, related to the amortization of licenses and goodwill.
American Cellular's EBITDA increased approximately 19 percent to $45.1 million for the quarter, compared with $37.9 million for the same period last year. EBITDA margin was 39.9 percent, compared with 36.4 percent in the fourth quarter last year.
American Cellular's increased EBITDA reflected its continued success in selling calling plans that concentrate customer traffic on its networks and those of its major roaming partners. Approximately 77 percent of fourth quarter gross subscriber additions represented sales of local and preferred calling plans. A lower number of analog-to-digital migrations in this year's fourth quarter - 5,000 versus 11,500 last year - also accounted for some of the improvement in EBITDA margin.
Net subscriber additions for the quarter were 17,300, compared with 24,400 for the same quarter last year. American's churn for the fourth quarter was 2.0 percent, compared with 1.8 percent in the fourth quarter of 2001.
American reported total revenue of $112.9 million for the fourth quarter of 2002, an increase of 8 percent over $104.3 million for the same period last year. Local service revenue at the company was $76.3 million for the quarter, an increase of 12 percent over the total of $68.4 million for the same quarter of 2001.
Roaming revenue for the fourth quarter of 2002 was approximately $32.7 million, compared with $31.1 million for the same quarter last year.
Average revenue per unit (ARPU) for the fourth quarter of 2002 was approximately $39, compared with $38 for the same quarter last year. Cash cost per unit (CCPU) in the fourth quarter was approximately $18, compared with CCPU of approximately $21 for the same period last year, despite a 15 percent increase in its monthly average customer minutes of use (MOUs). EBITDA margin on local service revenue consequently rose to 24.8 percent for the fourth quarter, compared with 19.2 percent for the same quarter last year.
American Cellular's capital expenditures were approximately $10.0 million in the fourth quarter, bringing its year-to-date total to $48.8 million.
American Cellular had approximately $15.9 million unrestricted cash and $42.3 million in restricted cash on its balance sheet as of December 31, 2002. Of the restricted cash, $34.1 million is in escrow to pay the April 2003 interest payment on its 9.5% Senior Subordinated Notes. The remaining $8.2 million was in escrow on December 31, 2002, related to the sale of the Tennessee RSA No. 4 to Verizon. In February 2003, approximately $4.1 million was released from escrow and used to reduce the amount outstanding on American's bank credit facility.
Since June 30, 2002, American Cellular has not been in compliance with the total debt leverage ratio covenant in its bank credit facility. Consequently, American Cellular's banks have the right, but not the obligation, to accelerate repayment of the outstanding balance of its credit facility, which at December 31, 2002, was approximately $894.3 million, down from $904.9 million at September 30, 2002. To date, no such acceleration has occurred, and American Cellular's management continues to hold discussions with its bank lenders and with representatives of certain of the ACC bondholders concerning a potential reorganization.
As a result of the non-compliance, the bank commitment amount on the American Cellular credit facility was reduced to outstanding borrowings on December 31, 2002, and the company currently has no available borrowing capacity.
American Cellular's debt is non-recourse to Dobson Communications and to American Cellular's other owner, AT&T Wireless.Conference Call
Dobson plans to conduct a conference call to discuss its fourth quarter results on Thursday, March 6, beginning at 9 a.m. ET (8 a.m. CT). On the conference call, the Company expects to discuss current market conditions and its operating outlook. The call will also be broadcast on the Internet.
Those interested may access the call by dialing:
Conference call (800) 665-0430
Pass code 545662
The call may also be accessed via the Internet through the Investor Relations page of Dobson's web site at www.dobson.net. A replay of the call will be available later in the day via Dobson's web site or by phone.
Replay (888) 203-1112
Pass code 545662
The replay will be available by phone for two weeks.
Dobson Communications is a leading provider of wireless phone services to rural and suburban markets in the United States. Headquartered in Oklahoma City, the rapidly growing Company owns or manages wireless operations in 17 states. For additional information on the Company and its operations, please visit its Web site at www.dobson.net.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These include, but are not limited to, statements regarding the Company's plans, intentions and expectations. Such statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, but are not limited to, increased levels of competition, shortages of key equipment, restrictions on the Company's ability to finance its growth and other factors. A more extensive discussion of the risk factors that could impact these areas and the Company's overall business and financial performance can be found in the Company's reports filed with the Securities and Exchange Commission. Given these concerns, investors and analysts should not place undue reliance on forward-looking statements.
Table 1
Dobson Communications Corporation
Statements of Operations
(Includes American Cellular ownership on an equity basis)
Three Months Ended Year Ended
December 31, December 31,
2002 2001 2002 2001
---------- ---------- ---------- ----------
($ in thousands except per share data)
Operating Revenue
Service revenue $ 94,759 $ 85,359 $ 373,517 $ 329,029
Roaming revenue 59,735 59,943 237,801 247,630
Equipment &
other revenue 4,941 4,820 20,229 22,745
---------- ---------- ---------- ----------
Total 159,435 150,122 631,547 599,404
---------- ---------- ---------- ----------
Operating Expenses
(excluding
depreciation &
amortization)
Cost of service 39,762 41,688 165,677 164,198
Cost of equipment 11,510 11,939 46,264 50,754
Marketing &
selling 17,297 18,915 73,360 74,798
General &
administrative 20,640 18,033 80,342 74,483
---------- ---------- ---------- ----------
Total 89,209 90,575 365,643 364,233
---------- ---------- ---------- ----------
EBITDA 70,226 59,547 265,904 235,171
Depreciation &
amortization (21,910) (48,121) (87,993) (184,427)
---------- ---------- ---------- ----------
Operating income 48,316 11,426 177,911 50,744
Minority interest (1,653) (1,497) (6,833) (5,895)
Loss from
investment in
joint venture(a) -- (18,491) (184,381) (69,182)
Other (loss)
income, net (5,085) (3,897) (1,755) 1,792
---------- ---------- ---------- ----------
Income (loss)
before interest
& income taxes 41,578 (12,459) (15,058) (22,541)
Interest expense (27,709) (31,670) (119,665) (143,020)
Income tax
(expense)
benefit (5,275) 9,585 41,165 36,650
---------- ---------- ---------- ----------
Income (loss) from
continuing
operations 8,594 (34,544) (93,558) (128,911)
Discontinued
operations:
Income from
discontinued
operations, net
of taxes -- 5,236 5,121 1,337
Loss from
discontinued
operations from
investment in
joint venture -- (75) (327) (720)
Gain from disposal
of discontinued
operations, net
of taxes -- -- 88,315 --
Gain from disposal
of discontinued
operations from
investment in
joint venture -- -- 6,736 --
---------- ---------- ---------- ----------
Income (loss)
before cumulative
effect of change
in accounting
principle 8,594 (29,383) 6,287 (128,294)
Cumulative effect
of change in
accounting
principle, net
of taxes -- -- (33,294) --
Cumulative effect
of change in
accounting
principle from
investment in
joint venture -- -- (140,820) --
---------- ---------- ---------- ----------
Income (loss)
before
extraordinary
items 8,594 (29,383) (167,827) (128,294)
Extraordinary
(loss) gain, net
of taxes (270) -- 1,365 --
---------- ---------- ---------- ----------
Net Income (loss) 8,324 (29,383) (166,462) (128,294)
Dividends on
preferred stock (22,837) (22,893) (94,451) (86,326)
Excess of face
value over
repurchase price
of preferred
stock 40,091 -- 70,323 --
---------- ---------- ---------- ----------
Net Income (loss)
applicable to
common
shareholders $ 25,578 $ (52,276) $ (190,590) $ (214,620)
========== ========== ========== ==========
Basic net income
(loss) applicable
to common
shareholders
per common share:
Continuing
operations $ 0.09 $ (0.37) $ (1.03) $ (1.37)
Discontinued
operations -- 0.06 1.10 0.01
Change in
accounting
principle -- -- (1.92) --
Extraordinary
gain -- -- 0.02 --
Dividends on and
redemption of
preferred stock 0.19 (0.25) (0.27) (0.92)
---------- ---------- ---------- ----------
Total basic and
diluted net income
(loss) applicable
to common
shareholders per
common share $ 0.28 $ (0.56) $ (2.10) $ (2.28)
========== ========== ========== ==========
Basic and diluted
weighted average
common shares
outstanding 90,109,318 93,384,356 90,671,688 93,969,310
========== ========== ========== ==========
(a) Represents the Company's 50% ownership in the Net Loss from
American Cellular, up to the amount invested.
Detailed as follows:
For the For the For the For the
three three year year
months months
ended Dec. ended Dec. ended Dec. ended Dec.
2002 2001 2002 2001
---------- ---------- ---------- ----------
EBITDA 45,097 37,939 180,297 155,947
Depreciation and
Amortization (17,050) (47,713) (66,745) (182,637)
Interest Expense (32,756) (41,657) (142,004) (165,457)
Other Income, net 423 1,245 1,388 3,723
Income tax benefit 5,272 14,470 14,383 52,200
Impairment of
Goodwill (423,894) -- (800,894) --
Dividends on
preferred stock (1,217) (1,264) (4,661) (2,139)
---------- ---------- ---------- ----------
Net Loss of
American Cellular
from continuing
operations (100%) (424,125) (36,980) (818,236) (138,363)
========== ========== ========== ==========
Table 2
Dobson Communications Corporation
Selected Financial Data
Dec. 31, 2002 Dec. 31, 2001
------------- ------------
($ in millions) ($ in millions)
Cash and cash equivalents $ 294.5 $ 161.6
============= ============
Total Debt: (a)
Dobson Operating Co., L.L.C.
credit facility $ 501.0 $ 822.3
Dobson/Sygnet credit facility 285.4 300.1
DCC 10.875% Senior Notes, net 298.2 298.1
Dobson/Sygnet Senior Notes 188.5 200.0
Other -- 0.4
------------- ------------
Total debt $ 1,273.1 $ 1,620.9
============= ============
Preferred Stock:
Series AA Preferred Stock,
5.96% $ 200.0 $ 200.0
Senior Exchangeable Preferred
Stock, 12.25%, net (b) 362.3(c) 351.2
Senior Exchangeable Preferred
Stock, 13.00%, net (d) 196.0(e) 230.7
------------- ------------
Total preferred stock $ 758.3 $ 781.9
============= ============
Year Ended Year Ended
Dec. 31, 2002 Dec. 31, 2001
------------- ------------
($ in millions) ($ in millions)
Capital Expenditures: (f) $ 83.9 $ 93.0
============= ============
(a) Does not include our proportionate interest in American
Cellular's total debt of $1.6 billion at December 31, 2002 and
$1.8 billion at December 31, 2001.
(b) Net of deferred financing costs of $(4.2) million and $(5.7)
million and discount of $(8.4) million and $(10.5) million for
the year end December 31, 2002 and 2001, respectively
(c) Subsequent to December 31, 2002, the Company repurchased $32.4
million carrying value of its 12.25% preferred stock, reducing
this outstanding balance to $331.4 million before amortization of
financing costs and the discount.
(d) Net of deferred financing costs of $(2.8) million $(4.3) million
for the year end December 31, 2002 and 2001, respectively
(e) Subsequent to December 31, 2002, the Company repurchased $27.5
million carrying value of its 13% preferred stock, reducing this
outstanding balance to $167.1 million before amortization of
financing costs.
(f) Does not include our proportionate share of American Cellular's
capital expenditures totaling $48.8 million for the year ended
December 31, 2002 and $74.9 million for the year ended December
31, 2001.
Table 3
Dobson Communications Corporation
For the Quarter Ended
12/31/01 3/31/02 6/30/02 9/30/02 12/31/02
--------- --------- --------- --------- ---------
($ in thousands except per subscriber data)
(unaudited)
Operating Revenue
Service revenue $ 85,359 $ 86,674 $ 94,290 $ 97,794 $ 94,759
Roaming revenue 59,943 51,880 60,875 65,312 59,735
Equipment & other
revenue 4,820 4,571 4,716 6,000 4,941
--------- --------- --------- --------- ---------
Total 150,122 143,125 159,881 169,106 159,435
--------- --------- --------- --------- ---------
Operating Expenses
(excluding
depreciation &
amortization)
Cost of service 41,688 40,628 43,229 42,058 39,762
Cost of equipment 11,939 11,333 11,298 12,124 11,510
Marketing & selling 18,915 17,800 19,198 19,064 17,297
General &
administrative 18,033 19,697 19,495 20,510 20,640
--------- --------- --------- --------- ---------
Total 90,575 89,458 93,220 93,756 89,209
--------- --------- --------- --------- ---------
EBITDA (a) $ 59,547 $ 53,667 $ 66,661 $ 75,350 $ 70,226
========= ========= ========= ========= =========
EBITDA Margin 39.7% 37.5% 41.7% 44.6% 44.0%
Pops 6,354,000 6,354,000 6,354,000 6,354,000 6,354,000
Post-paid
Gross Adds 65,000 58,400 61,400 58,800 58,200
Net Adds 22,800 11,100 25,900 15,500 18,200
Subscribers 668,800 679,900 705,800 721,300 739,500
Churn 2.1% 2.3% 1.7% 2.0% 1.8%
Average Service
Revenue per
Subscriber $ 43 $ 42 $ 45 $ 45 $ 43
Average Service
and Roaming
Revenue per
Subscriber $ 73 $ 68 $ 74 $ 76 $ 70
Pre-paid
Net Adds 2,700 1,700 (3,700) (4,600) (1,300)
Subscribers 14,600 16,300 12,600 8,000 6,700
Reseller
Net Adds 4,900 (700) 100 3,400 2,000
Subscribers 16,800 16,100 16,200 19,600 21,600
Total
Net Adds 30,400 12,100 22,300 14,300 18,900
Subscribers (b) 700,200 712,300 734,600 748,900 767,800
Penetration 11.0% 11.2% 11.6% 11.8% 12.1%
(a) Includes $1.9 million, $1.9 million, $2.1 million, $2.2 million
and $2.1 million of EBITDA for the quarters ended December 31,
2001, March 31, 2002, June 30, 2002, September 30, 2002 and
December 31, 2002 respectively, related to minority interests.
(b) Billing reconciliation included in fourth quarter 2001
subscribers.
Table 4
American Cellular Corporation
For the Quarter Ended
12/31/01 3/31/02 6/30/02 9/30/02 12/31/02
($ in thousands except per share data)
(unaudited)
Operating Revenue
Service revenue $ 68,389 $ 70,187 $ 76,260 $ 79,430 $ 76,267
Roaming revenue 31,050 26,593 35,592 40,237 32,725
Equipment & other
revenue 4,858 3,103 3,958 4,535 3,943
--------- --------- --------- --------- ---------
Total 104,297 99,883 115,810 124,202 112,935
--------- --------- --------- --------- ---------
Operating Expenses
(excluding
depreciation &
amortization)
Cost of service 28,807 27,374 29,273 28,392 25,372
Cost of
equipment 7,552 7,446 7,704 9,053 10,003
Marketing &
selling 14,045 13,574 14,813 15,031 14,205
General &
administrative 15,954 16,682 16,956 18,396 18,258
--------- --------- --------- --------- ---------
Total 66,358 65,076 68,746 70,872 67,838
--------- --------- --------- --------- ---------
EBITDA $ 37,939 $ 34,807 $ 47,064 $ 53,330 $ 45,097
========= ========= ========= ========= =========
EBITDA Margin 36.4% 34.8% 40.6% 42.9% 39.9%
Pops 4,997,000 4,997,000 4,997,000 4,997,000 4,997,000
Post-paid
Gross Adds 55,000 46,800 48,700 49,900 53,000
Net Adds 23,000 10,100 16,400 11,200 14,800
Subscribers 605,300 615,400 631,800 643,000 657,800
Churn 1.8% 2.0% 1.7% 2.0% 2.0%
Average Service
Revenue per
Subscriber $ 38 $ 38 $ 40 $ 41 $ 39
Average Service
and Roaming
Revenue per
Subscriber $ 55 $ 52 $ 59 $ 62 $ 55
Pre-paid
Net Adds (500) (200) (200) (300) 900
Subscribers 4,700 4,500 4,300 4,000 4,900
Reseller
Net Adds 1,900 200 (500) 4,300 1,600
Subscribers 22,100 22,300 21,800 26,100 27,700
Total
Net Adds 24,400 10,100 15,700 15,200 17,300
Subscribers (a) 632,100 642,200 657,900 673,100 690,400
Penetration 12.6% 12.9% 13.2% 13.5% 13.8%
(a) Billing reconciliation included in fourth quarter 2001
subscribers.
Table 5
Dobson Operating Company LLC
For the Quarter Ended
12/31/01 3/31/02 6/30/02 9/30/02 12/31/02
($ in thousands except per subscriber data)
(unaudited)
Operating Revenue
Service revenue $ 50,591 $ 52,501 $ 56,999 $ 58,676 $ 57,000
Roaming revenue 47,753 41,561 48,358 52,116 47,419
Equipment & other
revenue 3,169 3,202 3,418 3,921 3,279
--------- --------- --------- --------- ---------
Total 101,513 97,264 108,775 114,713 107,698
--------- --------- --------- --------- ---------
Operating Expenses
(excluding
depreciation &
amortization)
Cost of service 30,289 29,675 31,640 30,775 28,915
Cost of
equipment 5,975 6,905 6,867 7,147 7,410
Marketing &
selling 12,045 11,765 12,716 12,599 11,045
General &
administrative 11,704 12,883 12,346 13,013 12,857
--------- --------- --------- --------- ---------
Total 60,013 61,228 63,569 63,534 60,227
--------- --------- --------- --------- ---------
EBITDA (a) $ 41,500 $ 36,036 $ 45,206 $ 51,179 $ 47,471
========= ========= ========= ========= =========
EBITDA Margin 40.9% 37.1% 41.6% 44.6% 44.1%
Pops 3,996,300 3,996,300 3,996,300 3,996,300 3,996,300
Post-paid
Gross Adds 36,400 36,500 39,400 36,800 36,300
Net Adds 12,000 7,200 16,100 6,200 7,700
Subscribers 384,200 391,400 407,500 413,700 421,400
Churn 2.2% 2.4% 1.9% 2.5% 2.3%
Average Service
Revenue per
Subscriber $ 44 $ 44 $ 47 $ 47 $ 45
Revenue per
Subscriber $ 86 $ 80 $ 87 $ 89 $ 83
Pre-paid
Net Adds 2,400 1,600 (3,600) (4,600) (1,600)
Subscribers 14,000 15,600 12,000 7,400 5,800
Reseller
Net Adds 1,600 (1,000) 500 3,700 2,200
Subscribers 11,700 10,700 11,200 14,900 17,100
Total
Net Adds 16,000 7,800 13,000 5,300 8,300
Subscribers (b) 409,900 417,700 430,700 436,000 444,300
Penetration 10.3% 10.5% 10.8% 10.9% 11.1%
(a) Includes $1.9 million, $1.9 million, $2.1 million, $2.2 million
and $2.1 million of EBITDA for the quarters ended December 31,
2001, March 31, 2002, June 30, 2002, September 30, 2002 and
December 31, 2002 respectively, related to minority interests.
(b) Billing reconciliation included in fourth quarter 2001
subscribers.
Table 6
Dobson/Sygnet Communications Company
For the Quarter Ended
12/31/01 3/31/02 6/30/02 9/30/02 12/31/02
($ in thousands except per subscriber data)
(unaudited)
Operating Revenue
Service revenue $ 34,769 $ 34,076 $ 37,097 $ 39,118 $ 37,760
Roaming revenue 12,189 10,319 12,516 13,196 12,315
Equipment & other
revenue 1,651 1,370 1,298 2,079 1,662
--------- --------- --------- --------- ---------
Total 48,609 45,765 50,911 54,393 51,737
--------- --------- --------- --------- ---------
Operating Expenses
(excluding
depreciation &
amortization)
Cost of service 11,399 10,953 11,589 11,284 10,847
Cost of
equipment 5,964 4,428 4,431 4,977 4,100
Marketing &
selling 6,870 6,035 6,482 6,465 6,252
General &
administrative 6,332 6,510 6,980 7,326 7,695
--------- --------- --------- --------- ---------
Total 30,565 27,926 29,482 30,052 28,894
--------- --------- --------- --------- ---------
EBITDA $ 18,044 $ 17,839 $ 21,429 $ 24,341 $ 22,843
========= ========= ========= ========= =========
EBITDA Margin 37.1% 39.0% 42.1% 44.8% 44.2%
Pops 2,357,700 2,357,700 2,357,700 2,357,700 2,357,700
Post-paid
Gross Adds 28,600 21,900 22,000 22,000 21,900
Net Adds 10,800 3,900 9,800 9,300 10,500
Subscribers 284,600 288,500 298,300 307,600 318,100
Churn 2.1% 2.1% 1.4% 1.4% 1.2%
Average Service
Revenue per
Subscriber $ 41 $ 39 $ 42 $ 43 $ 40
Average Service
and Roaming
Revenue per
Subscriber $ 56 $ 51 $ 56 $ 57 $ 53
Pre-paid
Net Adds 300 100 (100) -- 300
Subscribers 600 700 600 600 900
Reseller
Net Adds 3,300 300 (400) (300) (200)
Subscribers 5,100 5,400 5,000 4,700 4,500
Total
Net Adds 14,400 4,300 9,300 9,000 10,600
Subscribers (a) 290,300 294,600 303,900 312,900 323,500
Penetration 12.3% 12.5% 12.9% 13.3% 13.7%
(a) Billing reconciliation included in fourth quarter 2001
subscribers.