NEW YORK, May 15 /PRNewswire-FirstCall/ -- Fusion (AMEX:FSN) today
announced financial results for the quarter ended March 31, 2009.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050705/NYTU073LOGO )
Fusion reported Consolidated Revenues of $9.0 million for the
quarter ended March 31, 2009. This represented a decrease of 20%
compared to revenues of $11.2 million for the quarter ended March
31, 2008, and excluded revenues of $0.3 million from the Consumer
segment which has now been reclassified to discontinued operations.
Prior to the reclassification, the year over year revenue decrease
was 19%. The change over the prior period was primarily
attributable to a decrease in the Carrier segment; however, the
Company's Corporate segment increased 252% from the first quarter
of 2008. Consolidated Gross Margin after the reclassification
decreased to 5.9% for the first quarter of 2009, compared to 6.5%
for the first quarter of 2008. Prior to the reclassification, the
Consolidated Gross Margin was 6.3% for the first quarter of 2009
compared to 7.1% for the first quarter of 2008. Selling, General
and Administrative costs improved $0.5 million, or 16% for the
first quarter of 2009 compared to the first quarter of 2008. The
improvement was primarily attributable to the Company's continuing
focus on cost-containment and efforts to maximize the
infrastructure efficiencies that have been ongoing for the past
year. For the quarter ended March 31, 2009, Adjusted EBITDA loss
(earnings before interest, taxes, depreciation, amortization, and
specific non-recurring and non-cash adjustments) increased $0.2
million, or 13%, to ($1.9) million, compared to Adjusted EBITDA of
($1.7) million for first quarter ended 2008. Fusion also reported
an increase in Net Loss applicable to Common Stockholders of ($3.2
million) or ($0.07) per share quarter ended March 31, 2009,
compared to a Net Loss applicable to Common Stockholders of ($2.5)
million or ($0.08) per share for the quarter ended March 31, 2008.
The primary reason for this increase was that in the first quarter
of 2008 there was a gain on debt forgiveness of $0.6 million.
Excluding that gain, the Net Loss applicable to Common Shareholders
in the first quarter of 2008 would have also been ($3.2 million),
representing no significant change in the year over year
comparison. As of March 31, 2009, the Company had current assets of
$2.5 million compared to $4.2 million as of December 31, 2008. The
decrease was primarily a result of a decrease in Accounts
Receivable due to early receipt in the first quarter of 2008 of
certain receivables. Total Liabilities and Stockholders'
equity(deficit) at March 31, 2009 was ($7.2) million deficit,
compared to ($9.5) million deficit as of December 31, 2008. The
primary reason for the change was the increase in the accumulated
deficit of $(3.0) million, offset by additional equity investments
of $0.7 million. Commenting on the results, Matthew Rosen, Chief
Executive Officer of Fusion, said, "Since the beginning of 2009,
Fusion has successfully raised an additional $2.4 million, but
continued to experience working capital and resource constraints,
which, along with current global economic conditions, negatively
impacted the Company's first quarter financial results.
Additionally, the first quarter of 2009 has been one of change for
Fusion, as we finalized our plans to exit the Consumer business and
restructure the Company. With the restructuring largely behind us,
our primary focus is continuing to drive the growth of the
corporate and carrier business segments and secure the capital
necessary to implement our business plan. With this focus, we look
forward to improved financial results in the coming quarters." Use
of Non-GAAP Financial Measures: The Company believes that EBITDA
(earnings before interest, taxes, depreciation and amortization) is
useful to investors because it is commonly used in the
communications industry to analyze companies on the basis of
operating performance and leverage. The Company also believes that
EBITDA provides investors with a measure of the Company's
operational and financial progress that corresponds with the
measurements used by management as a basis for allocating resources
and making other operating decisions. Adjusted EBITDA provides an
adjusted view of EBITDA that takes into account certain significant
nonrecurring transactions, such as impairment losses associated
with divested businesses and forgiveness of debt, which vary
significantly between periods and are not recurring in nature.
Although the Company uses Adjusted EBITDA as one of several
financial measures to assess its operating performance, its use is
limited as it excludes certain significant operating expenses.
EBITDA and Adjusted EBITDA are not intended to represent cash flows
for the period presented, nor have they been presented as an
alternative to operating income or as an indicator of operating
performance and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
Generally Accepted Accounting Principles (GAAP). Consistent with
the SEC Regulation G, the non-GAAP measures in this press release
have been reconciled to the nearest GAAP measure, which can be
viewed under the heading "Reconciliation of Net Income (Loss) to
Adjusted EBITDA", immediately following the Consolidated Statements
of Operations included in this press release. Earnings Conference
call The Company will host a conference call to discuss its
financial results at 1:00 P.M. ET today. The conference call can be
accessed by dialing 877-604-9668. A replay of the call will be
available through May 18, 2009. To listen to the replay, please
call 888-203-1112 (Domestic) or 719-457-0820 (International). To
access the replay, users will need to enter the following passcode:
8389574. The call will be available live on the Internet at
http://www.fusiontel.com/. The online archive of the web cast will
be available for one year following the call. Statements in this
Press Release that are not purely historical facts, including
statements regarding Fusion's beliefs, expectations, intentions or
strategies for the future, may be "forward-looking statements"
under the Private Securities Litigation Reform Act of 1995. All
forward-looking statements involve a number of risks and
uncertainties that could cause actual results to differ materially
from the plans, intentions and expectations reflected in or
suggested by the forward-looking statements. Such risks and
uncertainties include, among others, introduction of products in a
timely fashion, market acceptance of new products, cost increases,
fluctuations in and obsolescence of inventory, price and product
competition, availability of labor and materials, development of
new third-party products and techniques that render Fusion's
products obsolete, delays in obtaining regulatory approvals,
potential product recalls, securing necessary funding and
litigation. Risk factors, cautionary statements and other
conditions which could cause Fusion's actual results to differ from
management's current expectations are contained in Fusion's filings
with the Securities and Exchange Commission and available through
http://www.sec.gov/. FUSION Philip Turits, Treasurer CONTACT:
212-201-2407 Damon Testaverde, Managing Director Network Financial
Securities 732-758-9001 FUSION TELECOMMUNICATIONS INTERNATIONAL,
INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS Three
Months Ended March 31, --------- 2009 2008 ---- ---- Revenues
$9,002,300 $11,207,002 Operating expenses: Cost of revenues
8,467,891 10,481,360 Depreciation and amortization 489,471 447,680
Selling, general and administrative expenses 2,470,280 2,953,464
Advertising and Marketing 7,496 11,452 ----- ------ Total operating
expenses 11,435,138 13,893,956 ---------- ---------- Operating loss
(2,432,838) (2,686,954) Other income (expense) Interest income
(expense), net (95,781) (15,659) Gain (loss) on debt forgiveness -
634,991 Gain (loss) on sale of investment in Estel - - Loss from
investment in Estel - - Other 2,215 (1,237) ----- ------ Total
other income (expense) (93,566) 618,095 ------- ------- Loss from
continuing operations (2,526,404) (2,068,859) Income (loss) from
discontinued operations (479,811) (294,130) -------- -------- Net
loss $(3,006,215) $(2,362,989) =========== =========== Losses
applicable to common stockholders Loss from continuing operations
$(2,526,404) $(2,068,859) Preferred stock dividends in arrears
(157,710) (159,462) -------- -------- Net loss applicable to common
stockholders from continuing operations (2,684,114) (2,228,321)
Income from discontinued operations (479,811) (294,130) --------
-------- Net loss applicable to common stockholders $(3,163,925)
$(2,522,451) =========== =========== Basic and diluted net loss per
common share: Loss from continuing operations $(0.06) $(0.07)
Income (loss) from discontinued operations (0.01) (0.01) -----
----- Net loss applicable to common stockholders $(0.07) $(0.08)
====== ====== Weighted average shares outstanding Basic and diluted
47,880,802 32,818,945 ========== ========== FUSION
TELECOMMUNICATIONS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET March 31, 2009 December 31, 2008
-------------- ----------------- ASSETS Current assets Cash and
cash equivalents $241,664 $427,433 Accounts receivable, net of
allowance 1,746,056 3,240,670 Prepaid expenses and other current
assets 311,000 261,863 Assets held for sale 72,286 - Assets of
Discontinued Operations 135,785 302,533 ------- ------- Total
current assets 2,506,791 4,232,499 --------- --------- Property and
equipment, net 3,325,598 3,829,669 --------- --------- Other assets
Security deposits 51,042 50,241 Restricted cash 416,566 416,566
Intangible assets, net 807,773 810,908 Other assets 50,852 127,908
------ ------- Total other assets 1,326,233 1,405,623 ---------
--------- TOTAL ASSETS $7,158,622 $9,467,791 ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities
Long-term debt, current portion $3,522,992 $2,362,992 Capital and
equipment financing lease obligations, current portion 126,502
122,960 Accounts payable and accrued expenses 9,438,723 10,039,015
Liabilities of discontinued operations 226,116 261,972 -------
------- Total current liabilities 13,314,333 12,786,939 ----------
---------- Long-term liabilities Other long-term liabilities
911,190 1,445,431 ------- --------- Total long-term liabilities
911,190 1,445,431 ------- --------- Stockholders' equity Preferred
stock, Class A-1, A-2, A-3 & A-4 80 80 Common stock 499,689
457,500 Capital in excess of par value 125,046,272 124,384,568
Accumulated deficit (132,612,942) (129,606,727) ------------
------------ Total stockholders' equity (7,066,901) (4,764,579)
---------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$7,158,622 $9,467,791 ========== ========== FUSION
TELECOMMUNICATIONS INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA Three Months Ended
March 31, ---------- 2009 2008 ---- ---- Net loss $(3,006,215)
$(2,362,989) Income from discontinued operations 479,811 294,130
------- ------- Loss from continuing operations (2,526,404)
(2,068,859) Adjustments: Interest (income) expense, net 95,781
15,659 Depreciation and amortization 489,471 447,680 -------
------- EBITDA (1,941,152) (1,605,520) Adjustments: (Gain) loss on
settlements of debt - (634,991) (Gain)/loss on disposal of fixed
assets - 537 Communication charges - 361,119 Other taxes 33,846
108,131 Non cash compensation 34,945 114,347 ------ -------
Adjusted EBITDA $(1,872,361) $(1,656,377) =========== ===========
http://www.newscom.com/cgi-bin/prnh/20050705/NYTU073LOGO
http://photoarchive.ap.org/ DATASOURCE: Fusion CONTACT: Philip
Turits, Treasurer, Fusion, +1-212-201-2407, ; Damon Testaverde,
Managing Director, Network Financial Securities, +1-732-758-9001,
Web Site: http://www.fusiontel.com/
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