Multiband Announces 2012 Third Quarter Results

Multiband Announces 2012 Third Quarter Results

2012 Year-to-Date Revenues of $227.7 million up 2.3% from $222.6 million in comparable period in 2011

Q3 of 2012 generated an operating profit of $3.5 million and net income of $1.6 million

Q3 Revenue in the MDU segment increases by 31.2% over the comparable period in 2011

EBITDA for the third quarter improves 71.4% to $6.0 million over the previous quarter

MINNEAPOLIS, Nov. 14, 2012 /PRNewswire/ -- Multiband Corporation, (NASDAQ:MBND), a leading Home Service Provider (HSP) for DIRECTV and the nation's largest DIRECTV Master System Operator (MSO) for Multiple Dwelling Units (MDUs), today announced financial results for the third quarter ended September 30, 2012.



Third Quarter Highlights


-- MDU segment revenue increases by 31.2% and 25.0% for the three and nine
month periods in 2012 over the comparable periods in 2011 due to a 60.0%
increase in the number of subscribers covered under its Master System
Operator agreement with DIRECTV reflecting the consolidation occurring
in the market. Total subscribers supported under this agreement now
total 139,000
-- Q3 EBITDA grows by 71.4% to $6.0 million over $3.5 million reported for
Q2. Company does not capitalize its vehicle leases. If these leases were
capitalized, 2012 Adjusted EBITDA would total $10.1 million for the
current quarter and $22.4 million year-to-date
-- Subsequent to the end of the quarter, the Company announced that DIRECTV
had extended both the HSP and MDU contracts now expiring in 2016
James L. Mandel, CEO of Multiband, commented, "In 2012, our core HSP revenues with DIRECTV were lower than the previous year periods by $8 million and $15 million for the three and the nine months ended September 30. Although we have replaced that revenue via our diversification initiatives, the replacement revenue is not as profitable as what we experience from our HSP business. As we have shown in the past, we are able to improve our operations but it does take significant effort and time. We are confident that these new sources of revenue will produce materially better results in 2013."

Other Highlights


-- Operating income was $3.5 million for both the three and nine months
ended September 30, 2012
-- Net income attributable to common stockholders was $1.6 million for the
quarter ($0.07 per basic and fully diluted share)
-- Cash grew to $10.1 million from $8.7 million at the end of the second
quarter, an increase of 16%
Conference Call Information
A conference call and live webcast will take place Wednesday, November 14, 2012 at 4:30 p.m. Eastern Time.

Anyone interested in participating should call 1-877-941-2069 if calling within the United States or 1-480-629-9713 if calling internationally. There will be a playback available until November 21, 2012. To listen to the playback, please call 1-877-870-5176 if calling within the United States or 1-858-384-5517 if calling internationally. Please use pin number 4575294 for the replay.

The call will also be accompanied live by webcast over the Internet and accessible at: http://public.viavid.com/index.php?id=102511

About Multiband Corporation

Multiband Corporation (Nasdaq: MBND) engages with a vast and growing array of technologies including renewable energy, wireless infrastructure, electrical power systems, digital signage, commercial audio/video solutions, hospitality IPTV and VOD systems. Multiband completes nearly 20% of all DIRECTV's installations, maintenance and upgrades for residents of single-family homes. Multiband also supplies broadband cable and satellite internet solutions for homes and businesses across the nation. As the largest nationwide DIRECTV master system operator in the Multiple Dwelling Unit (MDU) market and one of the largest full-service home service providers (HSPs), Multiband is a driven leader in a competitive industry. Additionally, Multiband is a leading provider of software and integrated billing services to MDUs on a single bill, including video, voice, data and other value-added local services, both directly and through strategic partnerships. Multiband focuses on providing world-class customer service and the highest level of performance for all partners and customers, from multinational corporations to individual families. Multiband is headquartered in Minneapolis, Minn., and has offices strategically placed around the continental United States.



Statements about our future expectations are "forward-looking statements" within the meaning of applicable Federal Securities Laws, and are not guarantees of future performance. When used herein, the words "may," "will," "should," "anticipate," "believe," "appear," "intend," "plan," "expect," "estimate," "approximate," and similar expressions are intended to identify such forward-looking statements. These statements involve risks and uncertainties inherent in our business, including those set forth in our most recent Annual Report on Form 10-K for the year ended December 31, 2011, and other filings with the SEC, and are subject to change at any time. Our actual results could differ materially from these forward-looking statements. We undertake no obligation to update publicly any forward-looking statement.

Company Contact
Contact: James Mandel, CEO for Multiband Corporation at (763)504-3000

Investor Contact
Cameron Donahue, Hayden IR, (651) 653-1854 or cameron@haydenir.com





NON-GAAP Financial Measures

To comply with Regulation G promulgated pursuant to the Sarbanes-Oxley Act, Multiband has attached to this news release, and will post to the company's investor relations website (www.multibandusa.com), a reconciliation of differences between GAAP and non-GAAP financial information that may be required in connection with issuing the it's quarterly financial results.


Multiband, as is common in its industry, uses Adjusted EBITDA as a measure of performance to demonstrate earnings exclusive of interest and non-cash events. Multiband manages its business based on its cash flows. Multiband, in its daily management of its business affairs and analysis of its monthly, quarterly and annual performance, makes its decisions based on cash flows, not on the amortization of assets obtained through historical activities. Multiband, in managing its current and future affairs, cannot affect the amortization of the intangible assets to any material degree, and therefore uses Adjusted EBITDA as its primary management guide. Since an outside investor may base its evaluation of Multiband's performance based on the net income of loss and not its cash flows, there is a limitation to the Adjusted EBITDA measurement. Adjusted EBITDA is not, and should not be considered, an alternative to net income or loss, income or loss from operations, or any other measure for determining operating performance of liquidity, as determined under accounting principals generally accepted in the United States (GAAP). The most directly comparable GAAP reference in Multiband's case is the removal of interest, depreciation, amortization, taxes and other non-cash expense.










Multiband Corporation and Subsidiaries
Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)
(in thousands)
(Unaudited)


Three Months Nine Months
Ended Ended
September September
30, 2012 30, 2012
------------ ------------

Net Income (GAAP) $1,627 $121

Add (deduct):
Stock-based compensation expense 75 984
Non-cash reserves 183 330
Other than temporary impairment
loss on available-for-sale
securities 71 652
Gain on bargain purchase (177) (177)
Non-recurring acquisition and
start-up expenses
Other 38 100
--- ---
Total Non-GAAP adjustments 190 1,889

Interest expense 935 2,774
Depreciation and amortization 1,789 5,277
Provision for income taxes 1,015 185
Non-recurring acquisition
expenses 467 1,221
--- -----

EBITDA (Non-GAAP) 6,023 11,467

Adjustment for non-capitalized
vehicles leases 4,072 10,902
----- ------

Adjusted EBITDA (Non-
GAAP) $10,095 $22,369










MULTIBAND CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)


Three Months Ended Nine Months Ended
------------------
September September September September 30, 2011
30, 2012 30, 2011 30, 2012 (unaudited)
(unaudited) (unaudited) (unaudited)
------------ ------------ ----------- -------------------

REVENUES $85,695 $86,366 $227,727 $222,623
------- ------- -------- --------

COSTS AND EXPENSES
Cost of products and services (exclusive
of depreciation and amortization shown
separately below) 62,893 60,332 167,750 160,201
Selling, general and administrative 17,557 17,014 51,218 45,131
Depreciation and amortization 1,789 1,566 5,277 4,986
----- -----

Total costs and expenses 82,239 78,912 224,245 210,318
------ ------ ------- -------

INCOME FROM OPERATIONS 3,456 7,454 3,482 12,305
----- ----- ----- ------

OTHER EXPENSE
Interest expense (935) (1,038) (2,774) (2,989)
Interest income 6 7 19 19
Proceeds from life insurance - - - 409
Gain on bargain purchase 177 - 177 -
Losses attributable to available for-
sale securities (71) - (652) -
Other income 9 125 54 246
--- --- --- ---

Total other expense (814) (906) (3,176) (2,315)
---- ---- ------ ------

INCOME BEFORE INCOME TAXES 2,642 6,548 306 9,990

PROVISION FOR INCOME TAXES 1,015 2,869 185 4,369
--- -----

NET INCOME 1,627 3,679 121 5,621

Preferred stock dividends 68 70 303 729
--- --- --- ---
INCOME (LOSS) ATTRIBUTABLE TO COMMON
STOCKHOLDERS $1,559 $3,609 $(182) $4,892
====== ====== ===== ======

INCOME (LOSS) PER COMMON SHARE - BASIC:
INCOME ATTRIBUTABLE TO COMMON $0.07 $0.17 $(0.01) $0.32
STOCKHOLDERS

INCOME (LOSS) PER COMMON SHARE - DILUTED:
INCOME ATTRIBUTABLE TO COMMON $0.07 $0.16 $(0.01) $0.26
STOCKHOLDERS

Weighted average common shares
outstanding - basic 21,690 21,595 21,744 15,418
====== ====== ====== ======
Weighted average common shares
outstanding -diluted 22,427 23,047 21,744 19,791
====== ====== ====== ======









MULTIBAND CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
(in thousands)


September 30, December 31,
2012 2011
(unaudited) (audited)
------------- ------------
CURRENT ASSETS
Cash and cash
equivalents $10,129 $18,169
Available-for-
sale
securities - 1,191
Accounts
receivable,
net 31,735 28,359
Inventories 11,065 14,276
Costs and
estimated
earnings in
excess of
billings on
uncompleted
contracts 1,633 998
Prepaid
expenses and
other 2,447 1,361
Income tax
receivable 833 42
Deferred tax
assets -
current 6,814 6,862
----- -----
Total Current
Assets 64,656 71,258
------ ------
PROPERTY AND
EQUIPMENT, NET 11,815 6,304
------ -----
OTHER ASSETS
Goodwill 37,796 37,796
Intangible
assets, net 12,451 14,597
Restricted cash
- certificate
of deposit 1,682 -
Insurance
collateral 10,898 8,061
Other assets 1,470 2,452
Deferred tax
assets - long-
term 949 1,134
--- -----
Total Other
Assets 65,246 64,040
------ ------

TOTAL ASSETS $141,717 $141,602
======== ========










MULTIBAND CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

LIABILITIES AND STOCKHOLDERS' EQUITY
(in thousands, except share and liquidation preference amounts)


September 30, 2012 December 31, 2011
(unaudited) (audited)
---------- --------
CURRENT LIABILITIES
Short-term debt $1,498 $457
Related parties debt - short term 650 -
Current portion of long-term debt, net of
original issue discount 34,369 4,936
Current portion of capital lease
obligations 538 324
Accounts payable 28,031 32,354
Billings in excess of costs and estimated
earnings on uncompleted contracts 24 41
Accrued liabilities - current 21,978 24,113
Deferred service obligations and revenue 503 1,570
--- -----
Total Current Liabilities 87,591 63,795
LONG-TERM LIABILITIES
Accrued liabilities - long-term 5,889 5,352
Long-term debt, net of current portion
and original issue discount 3,521 29,229
Capital lease obligations, net of current
portion 884 274
--- ---
Total Liabilities 97,885 98,650
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Cumulative convertible preferred stock, no
par value:
8% Class A (12,696 shares issued and
outstanding, $133,308 liquidation
preference) 191 191
10% Class C (109,000 shares issued and
outstanding, $1,090,000 liquidation
preference) 1,411 1,411
10% Class F (150,000 shares issued and
outstanding, $1,500,000 liquidation
preference) 1,500 1,500
8% Class G (10,000 shares issued and
outstanding, $100,000 liquidation
preference) 41 41
6% Class H (0.00 and 1.00 shares issued
and outstanding, $0 and $100,000
liquidation preference) - -
Common stock, no par value (21,640,959 and
21,612,380 shares issued and outstanding) 66,495 66,290
Stock-based compensation 49,857 49,000
Accumulated deficit (75,663) (75,481)
------- -------
Total Stockholders' Equity 43,832 42,952
------ ------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $141,717 $141,602
======== ========




SOURCE Multiband Corporation

Multiband Corporation


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