EXHIBIT 99.1
[GoAmerica letterhead ]
CONTACTS: Investor Relations
201-996-1717
investors@goamerica.net
GOAMERICA ANNOUNCES RESULTS FOR THE FIRST QUARTER OF 2004
* * *
Significantly Improved Balance Sheet Positions
Company For Expansion Into New Services
Hackensack, NJ--May 12, 2004--GoAmerica, Inc. (NASDAQ: GOAM) today announced
results for the first quarter ended March 31, 2004 and the completion of the
Company's restructuring.
Total revenue for the three months ended March 31, 2004 was approximately $1.9
million, compared to total revenue in the previous quarter of approximately $2.3
million and total revenue of approximately $3.1 million in the first quarter of
2003. As in past quarters, the sequential decrease in total revenue was due in
part to declining use of the Company's historical Go.Web services and continuing
efforts to improve the payment profile of its subscriber base by eliminating
those subscribers with poor payment performance.
The Company's balance sheet has been significantly enhanced due to relief from
debt in excess of $2 million during the first quarter of 2004 while successfully
completing a private placement equity financing of $14.5 million. As a result,
the Company received approximately $12.7 million in net proceeds; approximately
$1.2 million was used to pay certain creditors, professional expenses,
registration and listing fees, with an additional $600,000 used to support a
letter of credit with one of the Company's network providers for its wireless
services. Overall, approximately $625,000 of the $2.4 million in cash used
during the first quarter was directly attributable to ongoing operations.
With its restructuring complete, the Company is focusing on building its
portfolio of telecommunications relay services, such as the new wireless relay
services recently announced with Sprint, and other value-added services. At the
Company's first quarter Special Stockholder Meeting during which stockholders
approved the $14.5 million financing, GoAmerica stockholders also authorized the
Company's Board of Directors to effect a reverse stock split at one of five
specified ratios by May 31, 2004 if necessary to maintain the Company's listing
on the Nasdaq SmallCap Market. To that end, the Company also announced that its
Board of Directors has approved the implementation of a one-for-10 reverse stock
split, which is expected to be effective as of 5:00 p.m. on May 14, 2004. The
Company's Common Stock is expected to begin trading on a split-adjusted basis
when trading opens on May 17, 2004.
Total cash equivalents, including restricted cash, on hand as of March 31, 2004
was $11.4 million, compared to $568,000 in the previous quarter and $2.8 million
as of March 31, 2003. In addition, as of March 31, 2004, the Company had working
capital of $11.2 million, compared to a working capital deficit of $2.7 million
as of December 31, 2003 and a working capital deficit of $2.6 million as of
March 31, 2003.
During the first quarter, GoAmerica also took steps to reduce further the
Company's cost structure by closing its New York and California network
operations centers and moving those operations to a lower cost, third party
provider. Additionally, as of April 30, 2004, the Company has successfully
transferred and merged all of Wynd's California-based operations with
GoAmerica's operations at the Company's headquarters location in New Jersey.
Net loss for the first quarter was approximately $1.1 million, or $0.01 per
basic and diluted common share, compared with a net loss of $1.4 million, or
$0.03 per basic and diluted common share, during the previous quarter, and a net
loss of approximately $3.0 million, or $0.05 per basic and diluted common share,
during the first quarter of 2003.
As a result of closing the balance of the financing in March 2004, the Company
believes it has sufficient funds to execute its new business plan, which focuses
on providing differentiated communication services to people with hearing loss.
ABOUT GOAMERICA
GoAmerica(R) is a leading provider of wireless telecommunications services for
people with hearing loss. The Company's vision is to improve the quality of life
for people who are deaf or hard of hearing by being their premier provider of
innovative communication services. WyndTell(R)--a GoAmerica service--is the
wireless service of choice for thousands of deaf consumers across the U. S., and
was recognized for Excellence in Universal Design and Technology, by the
California Governor's Committee for the Employment of Disabled Persons. For more
information, visit www.goamerica.com or contact GoAmerica directly at TTY
201-527-1520, voice 201-996-1717.
The statements contained in this news release (including our estimate regarding
the availability and sufficiency of cash resources) that are not based on
historical fact are "forward-looking statements" within the meaning of Section
21E of the Securities Exchange Act of 1934, as amended. Forward-looking
statements may be identified by the use of forward-looking terminology such as
"may", "will", "expect", "estimate", "anticipate", "continue", or similar terms,
variations of such terms or the negative of those terms. Such forward-looking
statements involve risks and uncertainties, including, but not limited to: (i)
our limited operating history; (ii) our ability to successfully manage our
strategic alliance with EarthLink; (iii) our dependence on EarthLink to provide
billing, customer and technical support to certain of our subscribers; (iv) our
ability to respond to the rapid technological change of the wireless data
industry and offer new services; (v) our dependence on wireless carrier
networks; (vi) our ability to respond to increased competition in the wireless
data industry; (vii) our ability to integrate acquired businesses and
technologies; (viii) our ability to generate revenue growth; (ix) our ability to
increase or maintain gross margins, profitability, liquidity and capital
resources; and (x) our ability to manage our remaining operations; and (xi)
difficulties inherent in predicting the outcome of regulatory processes. Such
risks and others are more fully described in the Risk Factors set forth in our
filings with the Securities and Exchange Commission. Our actual results could
differ materially from the results expressed in, or implied by, such
forward-looking statements. Each reference in this news release to "GoAmerica",
the "Company" or "We", or any variation thereof, is a reference to GoAmerica,
Inc. and its subsidiaries. "GoAmerica" and "WyndTell" are registered trademarks
of GoAmerica. "Go.Web", "Go.Web Enterprise Server", "Mobile Office", and
"OnPrem" are also trademarks or service marks of GoAmerica. Other names may be
trademarks of their respective owners.
- Tables to follow -
GOAMERICA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
MARCH 31, DECEMBER 31,
2004 2003
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents.............................................. $ 10,816 $ 568
Accounts receivable, net............................................... 1,636 1,737
Other receivables..................................................... -- 534
Merchandise inventories................................................ 201 213
Prepaid expenses and other current assets.............................. 433 115
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Total current assets........................................................ 13,086 3,167
Other assets................................................................ 8,656 9,798
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Total assets................................................................ $ 21,742 $ 12,965
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable....................................................... $ 568 $ 1,472
Accrued expenses....................................................... 735 3,040
Bridge note payable, net............................................... -- 625
Deferred revenue....................................................... 523 673
Other current liabilities.............................................. 11 13
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Total current liabilities................................................... 1,837 5,823
Stockholders' equity ....................................................... 19,905 7,142
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$ 21,742 $ 12,965
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GOAMERICA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED MARCH 31,
2004 2003
REVENUES:
Subscriber..................................................... $ 1,866 $ 2,511
Equipment...................................................... 36 411
Other.......................................................... 46 181
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1,948 3,103
COSTS AND EXPENSES:
Cost of subscriber airtime..................................... 868 737
Cost of network operations..................................... 293 712
Cost of equipment revenue...................................... 34 397
Sales and marketing............................................ 169 600
General and administrative..................................... 1,505 3,463
Research and development....................................... 191 515
Depreciation and amortization of fixed assets.................. 280 585
Amortization of other intangibles.............................. 252 229
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3,592 7,238
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Loss from operations................................................ (1,644) (4,135)
Other income (expense):
Gain on sale of subscribers.................................... -- 1,180
Settlement gains, net.......................................... 1,621 --
Interest expense, net.......................................... (1,065) (12)
--------------- ---------------
Total other income.................................................. 556 1,168
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Net loss............................................................ $ (1,088) $ (2,967)
============== ==============
Basic net loss per share............................................ $ (0.01) $ (0.05)
=============== ===============
Diluted net loss per share.......................................... $ (0.01) $ (0.05)
=============== ===============
Weighted average shares used in computation of basic net loss per
share......................................................... 79,693,307 54,069,736
Weighted average shares used in computation of diluted net loss per
share......................................................... 79,693,307 54,069,736