EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACTS:
Media Investors
Robert W. Stewart Michael S. Kraft
703-762-5175 703-762-5359
888-894-7812 800-981-5994
Teligent reports third quarter financial results, completes launch of first
15 markets
VIENNA, VA., November 11, 1998 - Teligent, an integrated communications company,
today released its third quarter financial results, a day after completing the
launch of lower-cost, high bandwidth communications services in its first 15
markets.
"We've exceeded the goal that we set for ourselves last January, when we
announced that we would be up and running in ten markets by the end of 1998,"
said Teligent Chairman and Chief Executive Officer Alex J. Mandl. "And we've met
another key objective: We are the industry leader in the early integration of
point-to-multipoint radio equipment into our local broadband communications
networks.
"Today, we are setting a new goal for 1999," Mandl added. "We intend to offer
Teligent's full range of communications services - local, long distance,
high-speed data and dedicated Internet access - in a total of 40 markets by the
end of next year.
"Those 40 markets comprise more than 540 cities and towns with a combined
population of more than 90 million," Mandl said. "And, as we've said before, we
intend to complete the buildout of all of our 74 markets, which cover 750 cities
and towns and 130 million people, by the end of 2001."
Reflecting its aggressive rollout schedule, Teligent reported a net loss of
$78.5 million for the third quarter on revenues of approximately $240,000,
compared to a net loss of $28.2 million for the third quarter of 1997. "These
results are right on target with our expectations," Mandl said.
For the nine months ending September 30, Teligent reported a net loss of $176.2
million on revenues of approximately $480,000, compared to a net loss of $78.8
million for the first three quarters of 1997.
Teligent's capital investment as of September 30 was $125.3 million, with
investment in property and equipment rising $45.7 million during the third
quarter. The company reported total assets of $797.4 million as of September 30,
with cash and cash equivalents of $509.5 million.
"Because we obtained our financing early, we've secured enough capital
approximately $1.7 billion - to finance our current network buildout plans
through the year 2000," said Teligent Chief Financial Officer Abraham L. Morris.
"We have about $500 million in cash on hand, and we have yet to draw down any of
our $800 million bank credit facility. That puts us in a very strong position as
we move into 1999."
By the end of this year, Morris said, Teligent anticipates that its capital
expenditures will total about $175 million. The company is targeting 1999
capital expenditures of approximately $300 million.
In the past two weeks, Teligent has launched sales and marketing campaigns in 15
markets, highlighting big savings, big bandwidth and a big bundle of service
offerings for small and medium-sized business customers. To date, Teligent has
launched service over its integrated broadband wireless networks in New York,
Los Angeles, Chicago, Houston, Dallas-Forth Worth, San Francisco-Oakland, Miami,
Denver, Washington DC, San Jose, San Antonio, Orlando, Jacksonville, Tampa and
Austin. Those markets comprise nearly 300 cities and towns with a combined
population of 50 million.
A key element of the marketing program is a revolutionary savings offer that
will save customers up to 30 percent off what they are currently paying for
local, long distance and Internet service, transforming their communications
bill into a simple, predictable package.
Teligent is able to make that offer because of the lower cost structure of its
integrated local communications networks, which feature Digital SmartWave(TM)
technology.
"The results of our initial marketing campaign have been phenomenal," said
Teligent President and Chief Operating Officer Kirby G. "Buddy" Pickle. "We have
generated literally thousands of inquiries, and in our markets, the sales force
is working hard to turn these leads into sales."
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Teligent has put in place the key systems required to acquire, bill, serve and
satisfy customers, Pickle said. Teligent has been producing and delivering
production bills since June and has deployed a full suite of automation tools to
the sales force. In addition, Teligent has built an advanced set of network
monitoring tools to track more than 250 network elements on a real time basis.
"We're moving from the building phase to the building and implementing stage,"
said Pickle. "As we make that transition, we have a clear advantage. Unlike
other new competitors in the local marketplace, we are focused on the direct
sales of retail communications services over our own local networks. We do not
have a local resale strategy. And we're not wholesalers. And that gives us a
significant leg up."
Teligent has made significant progress so far this year, Pickle said. "We have
Teligent teams working in 30 markets. The Teligent workforce has grown to more
than 1,200, and the sales force numbers 150. That compares to a total workforce
of 830 and a sales force of 68 at the end of the second quarter."
The company has signed leases or option agreements covering access rights to
about 1,600 buildings. It has installed 13 Nortel DMS switches, and has recently
ordered an additional five switches.
The company so far has received authority to offer competitive local telephone
services in 35 states and the District of Columbia, comprising 70 of Teligent's
markets. That compares to 27 markets in which authority had been granted at the
end of 1997.
Teligent also has successfully negotiated interconnection agreements covering 64
markets with all of the major local exchange carriers, including Ameritech, Bell
Atlantic, BellSouth, GTE, Pacific Bell, Southwestern Bell, Sprint (Centel), and
U S WEST. At the end of 1997, Teligent's interconnection agreements covered 25
markets.
Instead of digging up streets and drilling holes in buildings, Teligent delivers
Digital SmartWave(TM) service by installing small antennas on the roofs of
customer buildings. When a customer picks up a telephone, turns on a computer or
activates a videoconference, the signal travels over inside wiring to the
rooftop antenna. The customer building antenna then relays the voice, data or
video signals to a Teligent base station antenna.
The base station antenna gathers signals from a cluster of surrounding customer
buildings, aggregates the signals and then routes them to a Teligent broadband
switching center. At the switching center, Teligent uses ATM (asynchronous
transfer mode) switches and data routers along with Nortel DMS switches to hand
off the traffic to other networks - the public circuit-switched voice network,
the packet-switched Internet, and private data networks.
As it builds its local networks, Teligent is combining the latest in
point-to-multipoint radio technology with more traditional network technology,
including point-to-point fixed wireless and broadband wireline to access its
customers. Point-to-multipoint radio technology offers significant cost savings
because it allows a single base station to serve a large cluster of customer
buildings.
Digital SmartWave(TM) technology is configured to handle both voice and data
traffic with equal ease, ensuring that Teligent can handle today's huge volume
of voice traffic and at the same time is prepared for the anticipated explosion
of data traffic.
Based in Vienna, Va., Teligent, Inc. (NASDAQ: TGNT) is a full-service,
integrated communications company that is offering small and medium-sized
business customers lower-cost local, long distance, high-speed data and
dedicated Internet services over its Digital SmartWave(TM) local networks in 15
major markets. Eventually, Teligent will expand service to 74 major metropolitan
areas throughout the United States. Teligent's offerings of regulated services
are subject to tariff approval.
For more information, visit the Teligent website at: http: www.teligent.com
Teligent is a registered trademark.
Except for any historical information contained herein, the matters discussed in
this press release contain forward-looking statements. While these statements
reflect the company's best current judgment, they are subject to risks and
uncertainties that could cause actual results to vary. These risks and
uncertainties include, but are not limited to, economic, key employee,
competitive, governmental, regulatory and technological factors affecting the
company's growth, operations, markets, products, services, licenses and other
issues discussed in the company's filings with the Securities and Exchange
Commission.
Financial Tables Follow
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TELIGENT, INC.
(a development stage company)
STATEMENTS OF OPERATIONS
(unaudited)
(Dollars In Thousands Except Share and Per Share Information)
Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- ---------------------------------
1998 1997 1998 1997
-------------------------------- ---------------------------------
Revenues:
Communications services $ 240 $ - $ 480 $ -
Management fees and other services - 1,200 - 2,914
------------------ ---------------- --------------- --------------
Total revenues 240 1,200 480 2,914
Costs and expenses:
Cost of services 25,238 1,161 50,571 2,875
Sales, general and administrative expenses 33,095 13,448 78,552 25,551
Stock-based compensation 6,721 14,062 20,274 51,935
Depreciation and amortization expense 3,389 140 7,042 306
------------------ ---------------- --------------- -------------
Total costs and expenses 68,443 28,811 156,439 80,667
------------------ ---------------- --------------- -------------
Loss from operations (68,203) (27,611) (155,959) (77,753)
Interest and other income 8,970 56 27,236 105
Interest expense (19,313) (645) (47,517) (1,178)
------------------ ---------------- -------------- -------------
Net loss $ (78,546) $ (28,200) $ (176,240) $ (78,826)
================== ================ =============== =============
Net loss per share (2) $ (1.49) $ (0.63) $ (3.35) $ (1.77)
================== ================ =============== =============
Weighted average common shares
outstanding (2) 52,593,151 44,426,299 52,589,921 44,426,299
================== ================ =============== =============
SELECTED FINANCIAL AND OTHER DATA:
Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- -------------------------------
1998 1997 1998 1997
-------------- -------------- ------------- ------------
EBITDA (1) $ (56,816) $ (12,659) $ (124,776) $ (24,012)
Cash used in operations (29,138) (9,099) (83,122) (22,508)
September, December,
1998 1997
------------- ------------
Cash and cash equivalents $ 509,478 $ 424,901
Total assets 797,385 596,380
Total stockholders' equity 120,543 274,146
Number of employees 1,133 221
(1) EBITDA (earnings before interest, taxes, depreciation and amortization)
excludes noncash charges for stock-based compensation and for amortization of
notes receivable from executives.
(2) Pro forma for the three and nine month periods ended September 30,
1997
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