Attached files
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| 8-K - 8-K - Spok Holdings, Inc | spok-20201028.htm |
| Exhibit 99.1 | ||||||||
| NEWS RELEASE |  | |||||||
CONTACT:
Al Galgano
952-567-0295
Al.Galgano@spok.com
Spok Reports 2020 Third Quarter Operating Results
Improvement in Software Bookings and Continued Strong Wireless Trends Contribute to Third Quarter Operating Performance
Board Declares Regular Quarterly Dividend
SPRINGFIELD, Va. (October 28, 2020) - Spok Holdings, Inc. (NASDAQ: SPOK), a global leader in healthcare communications, today announced operating results for the third quarter ended September 30, 2020. In addition, the Company’s Board of Directors declared a regular quarterly dividend of $0.125 per share, payable on December 10, 2020, to stockholders of record on November 16, 2020.
Key Third Quarter Operating Highlights:
•Software bookings in the third quarter totaled $21.4 million, up nearly 39% and nearly 5% on a sequential and year-over-year basis, respectively. Third quarter bookings included the Company's first two Spok Go® deals with an aggregate total contract value of $812,000. Third quarter software bookings included $9.4 million of operations bookings and $12.0 million of maintenance renewals. At September 30, 2020 the software revenue backlog totaled $51.7 million, up almost 7% from the backlog of $48.4 million at June 30, 2020.
•Third quarter 2020 software revenue totaled $16.9 million, up more than 15% from the prior quarter. Software revenue in the third quarter included $7.4 million of operations revenue and $9.5 million of maintenance revenue. This compares to operations revenue of $5.2 million and maintenance revenue of $9.5 million in the prior quarter.
•The quarterly rate of paging unit erosion was 1.9% in the third quarter of 2020, down from
paging unit erosion of 2.3% in the year-earlier period. Gross disconnects were down on both a sequential and year-over-year basis.
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•The rate of wireless revenue erosion in the third quarter was 1.2%, down 20 basis points from the revenue erosion rate in both the prior quarter and the third quarter of 2019.
•Total paging ARPU (average revenue per unit) was $7.34 in the third quarter of 2020, compared to $7.24 in the prior quarter and $7.32 in the year-earlier quarter.
•Operating expenses in the third quarter of 2020 totaled $35.0 million, up from $32.6 million in the prior quarter and down from $42.1 million in the third quarter of 2019. Adjusted operating expenses totaled $35.5 million in the third quarter of 2020, compared to $34.1 million in the prior quarter and $39.8 million in the third quarter of 2019. Benefiting operating expenses in the third quarter of 2020, the Company received $0.4 million in CARES Act tax credits, as well as approximately $2.2 million in cost savings from the previously discussed employee furloughs.
•Capital expenses were $0.9 million in the third quarter of 2020, compared to $1.4 million in the year-earlier quarter.
•The number of full-time equivalent employees at September 30, 2020 totaled 613, compared to 617 in the prior year quarter.
•Capital paid to stockholders in the third quarter of 2020 totaled $2.4 million. This came in the form of the Company's regular quarterly dividend.
•The Company’s cash, cash equivalents and short-term investments balance at September 30, 2020, was $79.2 million, up from $77.3 million at December 31, 2019.
2020 Third Quarter and Year-To-Date Results:
Consolidated revenue for the third quarter of 2020 under Generally Accepted Accounting Principles (“GAAP”) was $37.7 million compared to $39.5 million in the third quarter of 2019. For the first nine months of 2020, consolidated revenue totaled $110.7 million, compared to $120.7 million in the first nine months of 2019.
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| For the three months ended | For the nine months ended | ||||||||||||||||||||||
| (Dollars in thousands) | September 30, 2020 | September 30, 2019 | Change (%) | September 30, 2020 | September 30, 2019 | Change (%) | |||||||||||||||||
| Wireless revenue | |||||||||||||||||||||||
| Paging revenue | $ | 19,961 | $ | 21,212 | (5.9) | % | $ | 60,403 | $ | 64,241 | (6.0) | % | |||||||||||
| Product and other revenue | 867 | 602 | 44.0 | % | 2,890 | 2,311 | 25.1 | % | |||||||||||||||
| Total wireless revenue | $ | 20,828 | $ | 21,814 | (4.5) | % | $ | 63,293 | $ | 66,552 | (4.9) | % | |||||||||||
| Software revenue | |||||||||||||||||||||||
| Operations revenue | $ | 7,338 | $ | 7,614 | (3.6) | % | $ | 18,728 | $ | 23,974 | (21.9) | % | |||||||||||
| Maintenance revenue | 9,527 | 10,025 | (5.0) | % | 28,678 | 30,215 | (5.1) | % | |||||||||||||||
| Total software revenue | 16,865 | 17,639 | (4.4) | % | 47,406 | 54,189 | (12.5) | % | |||||||||||||||
| Total revenue | $ | 37,693 | $ | 39,453 | (4.5) | % | $ | 110,699 | $ | 120,741 | (8.3) | % | |||||||||||
GAAP net income for the third quarter of 2020 was $3.2 million, or $0.16 per diluted share, compared to a net loss of $1.3 million, or $0.07 per diluted share, in the third quarter of 2019. GAAP net income for the first nine months of 2020 was $2.4 million, or $0.12 per diluted share, compared to a net loss of $1.3 million, or $0.07 per diluted share, in the first nine months of 2019.
In the third quarter of 2020, the Company generated $3.8 million of adjusted EBITDA, compared to adjusted EBITDA of $3.0 million in the prior quarter and $0.6 million in the third quarter of 2019. In the first nine months of 2020, the Company generated $4.3 million of adjusted EBITDA, compared to adjusted EBITDA of $6.0 million in the prior year period.
| For the three months ended | For the nine months ended | ||||||||||||||||||||||
| (Dollars in thousands) | September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | |||||||||||||||||||
| Net income (loss) | $ | 3,165 | $ | (1,326) | $ | 2,384 | $ | (1,255) | |||||||||||||||
| Basic net income (loss) per share | $ | 0.17 | $ | (0.07) | $ | 0.13 | $ | (0.07) | |||||||||||||||
| Diluted net income (loss) per share | $ | 0.16 | $ | (0.07) | $ | 0.12 | $ | (0.07) | |||||||||||||||
| Adjusted EBITDA | $ | 3,777 | $ | 577 | $ | 4,291 | $ | 5,951 | |||||||||||||||
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Management Commentary:
“While we are still operating under the impact and uncertainty of the pandemic and many of our customers continue to struggle with the challenges presented by COVID-19, our outlook is improving as we saw many positive developments during the third quarter,” said Vincent D. Kelly, president and chief executive officer. "During the quarter, we saw significant increases in software operations bookings on both a sequential and year-over-year basis, as well as continued strong trends in our wireless business. Sustained expense management kept third quarter expense levels consistent with the prior quarter and down sharply from the prior year, even after adding back capitalized software development costs. Our software revenue backlog is at record levels and we generated nearly $4 million of adjusted EBITDA in the quarter. After capital expenditures and paying the quarterly dividend, Spok was able to grow our cash, cash equivalents and short-term investment balances from the prior quarter and prior year-end levels. We are focused on driving positive free cash flow for 2020 and Spok remains committed to paying our regular quarterly dividend. We believe we will be able to achieve this while continuing to support our Spok Care Connect® platform and in the near term, investing in innovation and the evolution of our cloud-native and integrated communication platform, Spok Go®.
"As we pointed out last quarter, many of our new software deals were pushed back due to the pandemic. I am pleased to report that several of those deals were closed during the third quarter, including our first two significant Spok Go deals. And, we expect to report more deals in the fourth quarter as well. During the third quarter our credibility in healthcare continued to grow, as we announced that all 20 adult hospitals and all 10 children’s hospitals named to U.S. News & World Report’s 2020-21 Best Hospitals Honor Roll use Spok clinical communication solutions to facilitate care collaboration and support exceptional patient care. For eight consecutive years Spok has partnered with all of the adult ‘Best Hospitals’. And, we did this while continuing to invest in and develop our software-as-a service, cloud-native platform, Spok Go. In the third quarter we were pleased to announce that this platform, along with Spok paging solutions, has earned System and Organization Controls (SOC) 2 Type II Compliance. This designation follows an audit performed by a Big 4 auditor and confirms that Spok’s information security practices, policies, procedures, and operations meet the SOC 2 Type II standards for managing customer data based on three trust service principles: security, availability and confidentiality.
"Finally, earlier this month Spok welcomed more than 600 attendees to Connect 20 Virtual, our annual conference for healthcare professionals. The virtual event gave healthcare clinicians, IT experts, and C-suite
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executives a chance to learn about Spok Go and to share information with each other about the future of care team communication, while sharing insights about how the COVID-19 pandemic has changed how they use health IT. Spok has received excellent feedback from our conference and based on requests that we have received, this year we will be providing access to selected presentations to the investment community on November 10th. We believe that Spok provides a critical function, that will become even more important in this environment. Spok's clinical communications platform provides hospitals with a system of action, delivering reliable communications and clinical information, including clinical test results, to care teams when and where it matters most to improve patient outcomes. We look forward to having our investors see this first hand." concluded Kelly.
Business Outlook:
Michael W. Wallace, chief operating officer and chief financial officer, said: “Expense management and strong financial discipline have always been critical in aligning our expense levels with anticipated near and long-term demand for our products, and that continued to be the case in the third quarter. In the period, operating expenses were down nearly 17% and adjusted operating expenses were down nearly 11% from prior year levels, with improvements in all expense categories over that period driven by furloughs, the CARES Act tax credits, and other reductions. Spok’s balance sheet remains strong, with a cash, cash equivalents and short-term investment balance of $79.2 million at September 30, 2020.”
Commenting on the Company’s previously provided financial guidance for 2020, Wallace noted, “Spok has been focused on continuing to understand the impact of the pandemic on our business and the potential for another spike, particularly given the impact of COVID-19 on the installation of our premise-based solutions and the roll-out of our new, cloud-native, SaaS based, Spok Go software solution. Because of the fluid nature of the situation, we, like many of our peer public companies, believe that it is most prudent to continue to suspend our practice of providing annual guidance for revenues and expenses at this time. We look forward to returning to our normal guidance format for 2021, when we report our financial results for the fourth quarter of 2020.”
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2020 Third Quarter Call and Replay:
Spok plans to host a conference call for investors to discuss its 2020 third quarter results at 10:00 a.m. ET on Thursday, October 29, 2020. Dial-in numbers for the call are 334-777-6978 or 800-367-2403. The pass code for the call is 1468983. A replay of the call will be available from 1:00 p.m. ET on October 29, 2020 until 1:00 p.m. ET on Thursday, November 12, 2020. To listen to the replay, please register at http://tinyurl.com/Spok2020Q3earningsreplay. Please cut and paste this address into your browser, enter the registration information, and you will be given access to the replay.
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Investor Update:
Spok will be providing access to selected presentations from the October Spok Connect 20 user conference. Presentations from that conference will be made available to investors starting at 10:00 a.m. on November 10, 2020. Information on registering for virtual attendance, as well as an agenda of the presentations, will be provided shortly. An archive of the webcast presentations, including audio, video and presentation slides, will be accessible in the investor section of Spok’s website.
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About Spok
Spok, Inc., a wholly owned subsidiary of Spok Holdings, Inc. (NASDAQ: SPOK), headquartered in Springfield, Virginia, is proud to be a global leader in healthcare communications. We deliver clinical information to care teams when and where it matters most to improve patient outcomes. Top hospitals rely on the Spok Go® and Spok Care Connect® platforms to enhance workflows for clinicians and support administrative compliance. Our customers send over 100 million messages each month through their Spok® solutions. When seconds count and patients' lives are at stake, Spok enables smarter, faster clinical communication. For more information, visit spok.com or follow @spoktweets on Twitter.
Spok is a trademark of Spok Holdings, Inc. Spok Go and Spok Care Connect are trademarks of Spok, Inc.
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Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: adjusted operating expenses and adjusted EBITDA. Adjusted operating expenses excludes depreciation, amortization and accretion, goodwill impairment and capitalized software development costs. Adjusted EBITDA represents net income/(loss) before interest income/expense, income tax expense/benefit, depreciation, amortization and accretion expense, stock based compensation expense, and capitalized software development costs.
We believe that these non-GAAP financial measures provide useful information to management and investors regarding certain financial and business trends relating to Spok's financial condition and results of operations. We use these non-GAAP measures for financial, operational and budgetary decision-making purposes, to understand and evaluate our core operating performance and trends, and to generate future operating plans. We believe that these non-GAAP financial measures permit us to more thoroughly analyze key financial metrics used to make operational decisions and allow us to assess our core operating results. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other software companies who present similar non-GAAP financial measures. We adjust for certain items because we do not regard these costs as reflective of normal costs related to the ongoing operation of the business in the ordinary course. In general, these items possess one or more of the following characteristics; non-cash expenses, factors outside of our control, items that are non-operational in nature, and unusual items not expected to occur in the normal course of business.
We do not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. We urge investors to review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures, which are included in this press release, and not to rely on any single financial measure to evaluate our business.
Safe Harbor Statement under the Private Securities Litigation Reform Act
Statements contained herein or in prior press releases which are not historical fact, such as statements regarding Spok’s future operating and financial performance are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that may cause Spok’s actual results to be materially different from the future results expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expectations include, but are not limited to, declining demand for paging products and services, continued demand for our software products and services, our ability to develop additional software solutions for our customers and manage our development as a global organization, the ability to manage operating expenses, particularly third party consulting services and research and development costs, future
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capital needs, competitive pricing pressures, competition from traditional paging services, other wireless communications services and other software providers, many of which are substantially larger and have much greater financial and human capital resources, changes in customer purchasing priorities or capital expenditures, government regulation of our products and services and the healthcare and health insurance industries, reliance upon third-party providers for certain equipment and services, unauthorized breaches or failures in cybersecurity measures adopted by us and/or included in our products and services, the effects of changes in accounting policies or practices, adverse economic, political or market conditions in the U.S. and international markets and other factors such as natural disasters, pandemics and outbreaks of contagious diseases and other adverse public health developments, such as coronavirus disease 2019 (COVID-19), as well as other risks described from time to time in our periodic reports and other filings with the Securities and Exchange Commission. Although Spok believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Spok disclaims any intent or obligation to update any forward-looking statements.
Tables to Follow
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| SPOK HOLDINGS, INC. | ||||||||||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (a) | ||||||||||||||||||||||||||
| (Unaudited and in thousands except share, per share amounts and ARPU) | ||||||||||||||||||||||||||
| For the three months ended | For the nine months ended | |||||||||||||||||||||||||
| 9/30/2020 | 9/30/2019 | 9/30/2020 | 9/30/2019 | |||||||||||||||||||||||
| Revenue: | ||||||||||||||||||||||||||
| Wireless | $ | 20,828 | $ | 21,814 | $ | 63,293 | $ | 66,552 | ||||||||||||||||||
| Software | 16,865 | 17,639 | 47,406 | 54,189 | ||||||||||||||||||||||
| Total revenue | 37,693 | 39,453 | 110,699 | 120,741 | ||||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||||
| Cost of revenue | 6,544 | 7,190 | 20,709 | 22,021 | ||||||||||||||||||||||
| Research and development | 3,459 | 7,437 | 11,662 | 20,411 | ||||||||||||||||||||||
| Technology operations | 7,357 | 7,805 | 22,472 | 23,345 | ||||||||||||||||||||||
| Selling and marketing | 4,272 | 5,595 | 14,463 | 17,279 | ||||||||||||||||||||||
| General and administrative | 10,994 | 11,813 | 33,056 | 34,255 | ||||||||||||||||||||||
| Depreciation, amortization and accretion | 2,335 | 2,305 | 6,553 | 6,999 | ||||||||||||||||||||||
| Total operating expenses | 34,961 | 42,145 | 108,915 | 124,310 | ||||||||||||||||||||||
| % of total revenue | 92.8 | % | 106.8 | % | 98.4 | % | 103.0 | % | ||||||||||||||||||
| Operating income (loss) | 2,732 | (2,692) | 1,784 | (3,569) | ||||||||||||||||||||||
| % of total revenue | 7.2 | % | (6.8) | % | 1.6 | % | (3.0) | % | ||||||||||||||||||
| Interest income | 127 | 399 | 636 | 1,300 | ||||||||||||||||||||||
| Other income | 151 | 163 | 113 | 528 | ||||||||||||||||||||||
| Income (loss) before income taxes | 3,010 | (2,130) | 2,533 | (1,741) | ||||||||||||||||||||||
| Benefit from (provision for) income taxes | 155 | 804 | (149) | 486 | ||||||||||||||||||||||
| Net income (loss) | $ | 3,165 | $ | (1,326) | $ | 2,384 | $ | (1,255) | ||||||||||||||||||
| Basic net income (loss) per common share | $ | 0.17 | $ | (0.07) | $ | 0.13 | $ | (0.07) | ||||||||||||||||||
| Diluted net income (loss) per common share | 0.16 | (0.07) | 0.12 | (0.07) | ||||||||||||||||||||||
| Basic weighted average common shares outstanding | 19,051,502 | 19,086,811 | 19,008,969 | 19,166,812 | ||||||||||||||||||||||
| Diluted weighted average common shares outstanding | 19,208,452 | 19,086,811 | 19,273,243 | 19,166,812 | ||||||||||||||||||||||
| Cash dividends declared per common share | 0.125 | 0.125 | 0.375 | 0.375 | ||||||||||||||||||||||
| Key statistics: | ||||||||||||||||||||||||||
| Units in service | 898 | 955 | 898 | 955 | ||||||||||||||||||||||
| Average revenue per unit (ARPU) | $ | 7.34 | $ | 7.32 | $ | 7.31 | $ | 7.33 | ||||||||||||||||||
| Bookings | $ | 21,414 | $ | 20,421 | $ | 52,465 | $ | 56,410 | ||||||||||||||||||
| Backlog | $ | 51,708 | $ | 42,604 | $ | 51,708 | $ | 42,604 | ||||||||||||||||||
| (a) Slight variations in totals are due to rounding. | ||||||||||||||||||||||||||
| SPOK HOLDINGS, INC. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited and in thousands except share, per share amounts and ARPU) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| For the three months ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | 12/31/2018 | |||||||||||||||||||||||||||||||||||||||||||
| Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Wireless | $ | 20,828 | $ | 21,078 | $ | 21,386 | $ | 21,615 | $ | 21,814 | $ | 22,127 | $ | 22,610 | $ | 23,091 | ||||||||||||||||||||||||||||||||||
| Software | 16,865 | 14,661 | 15,881 | 17,933 | 17,639 | 17,398 | 19,154 | 20,165 | ||||||||||||||||||||||||||||||||||||||||||
| Total revenue | 37,693 | 35,739 | 37,267 | 39,548 | 39,453 | 39,525 | 41,764 | 43,256 | ||||||||||||||||||||||||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Cost of revenue (b) | 6,544 | 5,901 | 8,264 | 8,051 | 7,190 | 7,239 | 7,592 | 8,772 | ||||||||||||||||||||||||||||||||||||||||||
| Research and development | 3,459 | 2,754 | 5,449 | 7,132 | 7,437 | 6,807 | 6,167 | 6,618 | ||||||||||||||||||||||||||||||||||||||||||
| Technology operations | 7,357 | 7,212 | 7,904 | 8,083 | 7,805 | 7,866 | 7,674 | 8,120 | ||||||||||||||||||||||||||||||||||||||||||
| Selling and marketing | 4,272 | 3,831 | 6,361 | 5,891 | 5,595 | 5,574 | 6,110 | 6,275 | ||||||||||||||||||||||||||||||||||||||||||
| General and administrative | 10,994 | 10,810 | 11,251 | 11,531 | 11,813 | 11,696 | 10,747 | 10,721 | ||||||||||||||||||||||||||||||||||||||||||
| Depreciation, amortization and accretion | 2,335 | 2,072 | 2,146 | 2,250 | 2,305 | 2,335 | 2,359 | 2,601 | ||||||||||||||||||||||||||||||||||||||||||
| Goodwill impairment | — | — | — | 8,849 | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Total operating expenses | 34,961 | 32,580 | 41,375 | 51,787 | 42,145 | 41,517 | 40,649 | 43,107 | ||||||||||||||||||||||||||||||||||||||||||
| % of total revenue | 92.8 | % | 91.2 | % | 111.0 | % | 130.9 | % | 106.8 | % | 105.0 | % | 97.3 | % | 99.7 | % | ||||||||||||||||||||||||||||||||||
| Operating income (loss) | 2,732 | 3,159 | (4,108) | (12,239) | (2,692) | (1,992) | 1,115 | 149 | ||||||||||||||||||||||||||||||||||||||||||
| % of total revenue | 7.2 | % | 8.8 | % | (11.0) | % | (30.9) | % | (6.8) | % | (5.0) | % | 2.7 | % | 0.3 | % | ||||||||||||||||||||||||||||||||||
| Interest income | 127 | 146 | 363 | 350 | 399 | 452 | 449 | 628 | ||||||||||||||||||||||||||||||||||||||||||
| Other income (expense) | 151 | 101 | (137) | 206 | 163 | 602 | (236) | (593) | ||||||||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | 3,010 | 3,406 | (3,882) | (11,683) | (2,130) | (938) | 1,328 | 184 | ||||||||||||||||||||||||||||||||||||||||||
| Benefit from (provision for) income taxes | 155 | 353 | (657) | 2,172 | 804 | 268 | (586) | 5 | ||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | 3,165 | $ | 3,759 | $ | (4,539) | $ | (9,511) | $ | (1,326) | $ | (670) | $ | 742 | $ | 189 | ||||||||||||||||||||||||||||||||||
| Basic net income (loss) per common share | $ | 0.17 | $ | 0.20 | $ | (0.24) | $ | (0.50) | $ | (0.07) | $ | (0.03) | $ | 0.04 | $ | 0.01 | ||||||||||||||||||||||||||||||||||
| Diluted net income (loss)\ per common share | 0.16 | 0.20 | (0.24) | (0.50) | (0.07) | (0.03) | 0.04 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||
| Basic weighted average common shares outstanding | 19,051,502 | 19,016,853 | 18,958,716 | 18,860,020 | 19,086,811 | 19,217,866 | 19,196,970 | 19,445,401 | ||||||||||||||||||||||||||||||||||||||||||
| Diluted weighted average common shares outstanding | 19,208,452 | 19,115,148 | 18,958,716 | 18,860,020 | 19,086,811 | 19,217,866 | 19,356,712 | 19,445,401 | ||||||||||||||||||||||||||||||||||||||||||
| Key statistics: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Units in service | 898 | 915 | 926 | 938 | 955 | 977 | 982 | 992 | ||||||||||||||||||||||||||||||||||||||||||
| Average revenue per unit (ARPU) | $ | 7.34 | $ | 7.24 | $ | 7.31 | $ | 7.33 | $ | 7.32 | $ | 7.26 | $ | 7.32 | $ | 7.36 | ||||||||||||||||||||||||||||||||||
| Bookings | $ | 21,414 | $ | 15,411 | $ | 15,639 | $ | 21,932 | $ | 20,421 | $ | 21,334 | $ | 14,654 | $ | 23,076 | ||||||||||||||||||||||||||||||||||
| Backlog | $ | 51,708 | $ | 48,441 | $ | 49,052 | $ | 50,553 | $ | 42,604 | $ | 39,718 | $ | 37,392 | $ | 40,422 | ||||||||||||||||||||||||||||||||||
| (a) Slight variations in totals are due to rounding. | ||||||||||||||||||||||||||||||||||||||||||||||||||
(b) An adjustment of $771 to cost of revenue, identified in the fourth quarter of 2018, has been reflected in this table as an increase to cost of revenue of $166, $196 and $359 in the first, second and third quarters of 2018, respectively. Total operating expenses, operating income (loss), income (loss) before income taxes, Net (loss) income and net (loss) income per share have been adjusted accordingly to reflect these changes. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| SPOK HOLDINGS, INC. | ||||||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS (a) | ||||||||||||||
| (In thousands) | ||||||||||||||
| 9/30/2020 | 12/31/2019 | |||||||||||||
| Unaudited | ||||||||||||||
| Assets | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 49,235 | $ | 47,361 | ||||||||||
| Short term investments | 29,994 | 29,899 | ||||||||||||
| Accounts receivable, net | 29,671 | 30,174 | ||||||||||||
| Prepaid expenses | 8,056 | 7,517 | ||||||||||||
| Other current assets | 1,645 | 2,714 | ||||||||||||
| Total current assets | 118,601 | 117,665 | ||||||||||||
| Non-current assets: | ||||||||||||||
| Property and equipment, net | 6,933 | 8,000 | ||||||||||||
| Operating lease right-of-use assets | 14,342 | 16,317 | ||||||||||||
| Capitalized software development, net | 7,784 | — | ||||||||||||
| Goodwill | 124,182 | 124,182 | ||||||||||||
| Intangible assets, net | 1,042 | 2,917 | ||||||||||||
| Deferred income tax assets, net | 48,308 | 48,983 | ||||||||||||
| Other non-current assets | 1,081 | 1,808 | ||||||||||||
| Total non-current assets | 203,672 | 202,207 | ||||||||||||
| Total assets | $ | 322,273 | $ | 319,872 | ||||||||||
| Liabilities and stockholders' equity | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 5,112 | $ | 3,615 | ||||||||||
| Accrued compensation and benefits | 13,845 | 11,680 | ||||||||||||
| Deferred revenue | 27,174 | 25,944 | ||||||||||||
| Operating lease liabilities | 5,220 | 5,437 | ||||||||||||
| Other current liabilities | 4,565 | 4,507 | ||||||||||||
| Total current liabilities | 55,916 | 51,183 | ||||||||||||
| Non-current liabilities: | ||||||||||||||
| Asset retirement obligations | 6,123 | 6,061 | ||||||||||||
| Operating lease liabilities | 9,766 | 11,575 | ||||||||||||
| Other non-current liabilities | 2,446 | 959 | ||||||||||||
| Total non-current liabilities | 18,335 | 18,595 | ||||||||||||
| Total liabilities | 74,251 | 69,778 | ||||||||||||
| Commitments and contingencies | ||||||||||||||
| Stockholders' equity: | ||||||||||||||
| Preferred stock | $ | — | $ | — | ||||||||||
| Common stock | 2 | 2 | ||||||||||||
| Additional paid-in capital | 90,297 | 86,874 | ||||||||||||
| Accumulated other comprehensive loss | (1,656) | (1,601) | ||||||||||||
| Retained earnings | 159,379 | 164,819 | ||||||||||||
| Total stockholders' equity | 248,022 | 250,094 | ||||||||||||
| Total liabilities and stockholders' equity | $ | 322,273 | $ | 319,872 | ||||||||||
| (a) Slight variations in totals are due to rounding. | ||||||||||||||
| SPOK HOLDINGS, INC. | ||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (a) | ||||||||||||||
| (Unaudited and in thousands) | ||||||||||||||
| For the nine months ended | ||||||||||||||
| 9/30/2020 | 9/30/2019 | |||||||||||||
| Operating activities: | ||||||||||||||
| Net income (loss) | $ | 2,384 | $ | (1,255) | ||||||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||
| Depreciation, amortization and accretion | 6,553 | 6,999 | ||||||||||||
| Deferred income tax expense | 15 | (569) | ||||||||||||
| Stock based compensation | 4,160 | 2,521 | ||||||||||||
| Provisions for doubtful accounts, service credits, and other | 914 | 652 | ||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Accounts receivable | (1,019) | 252 | ||||||||||||
| Prepaid expenses, inventory and other assets | 3,701 | 2,131 | ||||||||||||
| Accounts payable, accrued liabilities and other liabilities | 1,566 | (1,366) | ||||||||||||
| Deferred revenue | 2,680 | 1,383 | ||||||||||||
| Net cash provided by operating activities | 20,954 | 10,748 | ||||||||||||
| Investing activities: | ||||||||||||||
| Purchases of property and equipment | (2,824) | (4,162) | ||||||||||||
| Capitalized software development | (8,206) | — | ||||||||||||
| Purchase of short-term investments | (44,870) | (44,499) | ||||||||||||
| Maturity of short-term investments | 45,000 | 19,000 | ||||||||||||
| Net cash used in investing activities | (10,900) | (29,661) | ||||||||||||
| Financing activities: | ||||||||||||||
| Cash distributions to stockholders | (7,388) | (7,440) | ||||||||||||
| Purchase of common stock (including commissions) | — | (6,575) | ||||||||||||
| Proceeds from issuance of common stock under the Employee Stock Purchase Plan | 166 | 119 | ||||||||||||
| Purchase of common stock for tax withholding on vested equity awards | (903) | (1,017) | ||||||||||||
| Net cash used in financing activities | (8,125) | (14,913) | ||||||||||||
| Effect of exchange rate on cash | (55) | (198) | ||||||||||||
| Net increase (decrease) in cash and cash equivalents | 1,874 | (34,024) | ||||||||||||
| Cash and cash equivalents, beginning of period | 47,361 | 83,343 | ||||||||||||
| Cash and cash equivalents, end of period | $ | 49,235 | $ | 49,319 | ||||||||||
| Supplemental disclosure: | ||||||||||||||
| Income taxes paid | $ | 148 | $ | 927 | ||||||||||
| (a) Slight variations in totals are due to rounding. | ||||||||||||||
| SPOK HOLDINGS, INC. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED REVENUE | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| SUPPLEMENTAL INFORMATION (a) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited and in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| For the three months ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | 12/31/2018 | ||||||||||||||||||||||||||||||||||||||||||||||
| Revenue | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Paging | $ | 19,961 | $ | 19,990 | $ | 20,451 | $ | 20,826 | $ | 21,212 | $ | 21,342 | $ | 21,687 | $ | 21,997 | |||||||||||||||||||||||||||||||||||||
| Non-paging | 867 | 1,088 | 935 | 789 | 602 | 785 | 923 | 1,094 | |||||||||||||||||||||||||||||||||||||||||||||
| Total wireless revenue | $ | 20,828 | $ | 21,078 | $ | 21,386 | $ | 21,615 | $ | 21,814 | $ | 22,127 | $ | 22,610 | $ | 23,091 | |||||||||||||||||||||||||||||||||||||
| License | 1,988 | 749 | 955 | 1,711 | 2,723 | 1,676 | 2,840 | 3,496 | |||||||||||||||||||||||||||||||||||||||||||||
| Services | 4,772 | 3,812 | 4,549 | 4,947 | 4,202 | 4,835 | 5,206 | 5,103 | |||||||||||||||||||||||||||||||||||||||||||||
| Equipment | 554 | 601 | 725 | 1,125 | 689 | 842 | 963 | 1,568 | |||||||||||||||||||||||||||||||||||||||||||||
| Subscription | 24 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Operations revenue | $ | 7,338 | $ | 5,162 | $ | 6,229 | $ | 7,783 | $ | 7,614 | $ | 7,353 | $ | 9,009 | $ | 10,167 | |||||||||||||||||||||||||||||||||||||
| Maintenance revenue | $ | 9,527 | $ | 9,499 | $ | 9,652 | $ | 10,150 | $ | 10,025 | $ | 10,045 | $ | 10,145 | $ | 9,998 | |||||||||||||||||||||||||||||||||||||
| Total software revenue | $ | 16,865 | $ | 14,661 | $ | 15,881 | $ | 17,933 | $ | 17,639 | $ | 17,398 | $ | 19,154 | $ | 20,165 | |||||||||||||||||||||||||||||||||||||
| Total revenue | $ | 37,693 | $ | 35,739 | $ | 37,267 | $ | 39,548 | $ | 39,453 | $ | 39,525 | $ | 41,764 | $ | 43,256 | |||||||||||||||||||||||||||||||||||||
| (a) Slight variations in totals are due to rounding. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| SPOK HOLDINGS, INC. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED OPERATING EXPENSES | ||||||||||||||||||||||||||||||||||||||||||||||||||
| SUPPLEMENTAL INFORMATION (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited and in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| For the three months ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | 12/31/2018 | |||||||||||||||||||||||||||||||||||||||||||
| Cost of revenue | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Payroll and related | $ | 4,941 | $ | 4,350 | $ | 5,785 | $ | 5,222 | $ | 5,099 | $ | 4,749 | $ | 4,931 | $ | 4,868 | ||||||||||||||||||||||||||||||||||
| Cost of sales | 1,064 | 1,098 | 1,940 | 2,278 | 1,567 | 1,900 | 2,080 | 3,349 | ||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 148 | 134 | 119 | 42 | 21 | 97 | 107 | 44 | ||||||||||||||||||||||||||||||||||||||||||
| Other | 391 | 319 | 420 | 509 | 503 | 493 | 474 | 511 | ||||||||||||||||||||||||||||||||||||||||||
Total cost of revenue (b) | 6,544 | 5,901 | 8,264 | 8,051 | 7,190 | 7,239 | 7,592 | 8,772 | ||||||||||||||||||||||||||||||||||||||||||
| Research and development | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Payroll and related | 4,147 | 4,115 | 4,761 | 5,056 | 5,083 | 4,639 | 4,263 | 4,350 | ||||||||||||||||||||||||||||||||||||||||||
| Outside services | 2,113 | 1,803 | 1,584 | 1,742 | 2,027 | 1,912 | 1,745 | 2,115 | ||||||||||||||||||||||||||||||||||||||||||
| Capitalized software development | (2,906) | (3,596) | (1,705) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 240 | 243 | 236 | 113 | 102 | 84 | 11 | 5 | ||||||||||||||||||||||||||||||||||||||||||
| Other | (135) | 189 | 573 | 221 | 225 | 172 | 148 | 148 | ||||||||||||||||||||||||||||||||||||||||||
| Total research and development | 3,459 | 2,754 | 5,449 | 7,132 | 7,437 | 6,807 | 6,167 | 6,618 | ||||||||||||||||||||||||||||||||||||||||||
| Technology operations | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Payroll and related | 2,246 | 2,213 | 2,712 | 2,656 | 2,823 | 2,662 | 2,647 | 2,616 | ||||||||||||||||||||||||||||||||||||||||||
| Site rent | 3,467 | 3,399 | 3,398 | 3,669 | 3,269 | 3,480 | 3,296 | 3,432 | ||||||||||||||||||||||||||||||||||||||||||
| Telecommunications | 949 | 961 | 1,001 | 1,026 | 1,016 | 1,019 | 996 | 1,021 | ||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 52 | 47 | 43 | 32 | 30 | 30 | 30 | 24 | ||||||||||||||||||||||||||||||||||||||||||
| Other | 643 | 592 | 750 | 700 | 667 | 675 | 705 | 1,027 | ||||||||||||||||||||||||||||||||||||||||||
| Total technology operations | 7,357 | 7,212 | 7,904 | 8,083 | 7,805 | 7,866 | 7,674 | 8,120 | ||||||||||||||||||||||||||||||||||||||||||
| Selling and marketing | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Payroll and related | 2,773 | 2,538 | 3,583 | 3,382 | 3,524 | 3,329 | 3,273 | 3,047 | ||||||||||||||||||||||||||||||||||||||||||
| Commissions | 1,059 | 852 | 1,212 | 1,158 | 1,114 | 1,298 | 1,424 | 1,759 | ||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 208 | 194 | 172 | 164 | 137 | 128 | 161 | 99 | ||||||||||||||||||||||||||||||||||||||||||
| Advertising and events | 151 | 160 | 784 | 1,034 | 703 | 656 | 933 | 1,236 | ||||||||||||||||||||||||||||||||||||||||||
| Other | 81 | 87 | 610 | 153 | 117 | 163 | 319 | 134 | ||||||||||||||||||||||||||||||||||||||||||
| Total selling and marketing | 4,272 | 3,831 | 6,361 | 5,891 | 5,595 | 5,574 | 6,110 | 6,275 | ||||||||||||||||||||||||||||||||||||||||||
| General and administrative | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Payroll and related | 3,476 | 3,355 | 4,134 | 3,974 | 4,220 | 4,136 | 4,041 | 4,087 | ||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | 968 | 744 | 612 | 770 | 674 | 690 | 219 | 860 | ||||||||||||||||||||||||||||||||||||||||||
| Bad debt | 178 | 628 | 43 | 56 | 402 | (96) | 308 | 303 | ||||||||||||||||||||||||||||||||||||||||||
| Facility rent, office, and technology costs | 2,259 | 2,276 | 2,068 | 1,952 | 2,369 | 2,485 | 2,294 | 2,072 | ||||||||||||||||||||||||||||||||||||||||||
| Outside services | 2,148 | 2,043 | 2,036 | 2,350 | 2,004 | 2,306 | 1,776 | 2,062 | ||||||||||||||||||||||||||||||||||||||||||
| Taxes, licenses and permits | 994 | 804 | 859 | 1,000 | 888 | 863 | 921 | 111 | ||||||||||||||||||||||||||||||||||||||||||
| Other | 971 | 960 | 1,499 | 1,429 | 1,256 | 1,312 | 1,188 | 1,226 | ||||||||||||||||||||||||||||||||||||||||||
| Total general and administrative | 10,994 | 10,810 | 11,251 | 11,531 | 11,813 | 11,696 | 10,747 | 10,721 | ||||||||||||||||||||||||||||||||||||||||||
| Depreciation, amortization and accretion | 2,335 | 2,072 | 2,146 | 2,250 | 2,305 | 2,335 | 2,359 | 2,601 | ||||||||||||||||||||||||||||||||||||||||||
| Goodwill impairment | — | — | — | 8,849 | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Operating expenses | $ | 34,961 | $ | 32,580 | $ | 41,375 | $ | 51,787 | $ | 42,145 | $ | 41,517 | $ | 40,649 | $ | 43,107 | ||||||||||||||||||||||||||||||||||
| Capital expenditures | $ | 934 | $ | 846 | $ | 1,063 | $ | 679 | $ | 1,378 | $ | 1,495 | $ | 1,287 | $ | 830 | ||||||||||||||||||||||||||||||||||
| (a) Slight variations in totals are due to rounding. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (b) An adjustment of $771 to cost of sales, identified in the fourth quarter of 2018, has been reflected in this table as an increase to cost of sales of $166, $196 and $359 in the first, second and third quarters of 2018, respectively. Total cost of revenue and operating expenses have been adjusted accordingly to reflect these changes. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| SPOK HOLDINGS, INC. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| UNITS IN SERVICE ACTIVITY, MARKET SEGMENT, CHURN | ||||||||||||||||||||||||||||||||||||||||||||||||||
| AND AVERAGE REVENUE PER UNIT (ARPU) (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited and in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| For the three months ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | 12/31/2018 | |||||||||||||||||||||||||||||||||||||||||||
| Paging units in service | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Beginning units in service (000's) | 915 | 926 | 938 | 955 | 977 | 982 | 992 | 999 | ||||||||||||||||||||||||||||||||||||||||||
| Gross placements | 25 | 35 | 24 | 22 | 28 | 35 | 27 | 30 | ||||||||||||||||||||||||||||||||||||||||||
| Gross disconnects | (42) | (46) | (36) | (39) | (50) | (40) | (37) | (37) | ||||||||||||||||||||||||||||||||||||||||||
| Net change | (17) | (11) | (12) | (17) | (22) | (5) | (10) | (7) | ||||||||||||||||||||||||||||||||||||||||||
| Ending units in service | 898 | 915 | 926 | 938 | 955 | 977 | 982 | 992 | ||||||||||||||||||||||||||||||||||||||||||
| End of period units in service % of total (b) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Healthcare | 83.7 | % | 83.6 | % | 82.6 | % | 82.4 | % | 81.7 | % | 81.7 | % | 81.6 | % | 81.4 | % | ||||||||||||||||||||||||||||||||||
| Government | 5.3 | % | 5.5 | % | 5.4 | % | 5.4 | % | 5.5 | % | 5.6 | % | 5.8 | % | 5.8 | % | ||||||||||||||||||||||||||||||||||
| Large enterprise | 4.3 | % | 4.4 | % | 5.5 | % | 5.5 | % | 6.1 | % | 5.9 | % | 5.9 | % | 5.9 | % | ||||||||||||||||||||||||||||||||||
| Other(b) | 6.6 | % | 6.6 | % | 6.5 | % | 6.6 | % | 6.7 | % | 6.8 | % | 6.7 | % | 6.9 | % | ||||||||||||||||||||||||||||||||||
| Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||||||||||||||||||||||
| Account size ending units in service (000's) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 1 to 100 units | 63 | 65 | 67 | 69 | 72 | 74 | 77 | 78 | ||||||||||||||||||||||||||||||||||||||||||
| 101 to 1,000 units | 167 | 165 | 171 | 173 | 175 | 179 | 186 | 190 | ||||||||||||||||||||||||||||||||||||||||||
| >1,000 units | 668 | 685 | 688 | 696 | 708 | 724 | 719 | 724 | ||||||||||||||||||||||||||||||||||||||||||
| Total | 898 | 915 | 926 | 938 | 955 | 977 | 982 | 992 | ||||||||||||||||||||||||||||||||||||||||||
| Account size net loss rate(c) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 1 to 100 units | (2.9) | % | (3.1) | % | (3.0) | % | (3.8) | % | (2.1) | % | (3.2) | % | (2.3) | % | (1.7) | % | ||||||||||||||||||||||||||||||||||
| 101 to 1,000 units | 1.5 | % | (4.2) | % | (1.0) | % | (1.0) | % | (2.4) | % | (3.9) | % | (2.3) | % | — | % | ||||||||||||||||||||||||||||||||||
| >1,000 units | (2.5) | % | (0.4) | % | (1.2) | % | (1.8) | % | (2.2) | % | 0.7 | % | (1.1) | % | (0.1) | % | ||||||||||||||||||||||||||||||||||
| Total | (1.8) | % | (1.3) | % | (1.3) | % | (1.8) | % | (2.2) | % | (0.5) | % | (1.1) | % | (0.2) | % | ||||||||||||||||||||||||||||||||||
| Account size ARPU | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 1 to 100 units | $ | 11.80 | $ | 11.65 | $ | 12.01 | $ | 11.99 | $ | 11.84 | $ | 12.00 | $ | 11.90 | $ | 11.61 | ||||||||||||||||||||||||||||||||||
| 101 to 1,000 units | 8.37 | 8.24 | 8.34 | 8.31 | 8.41 | 8.47 | 8.35 | 8.28 | ||||||||||||||||||||||||||||||||||||||||||
| >1,000 units | 6.67 | 6.57 | 6.59 | 6.62 | 6.59 | 6.47 | 6.57 | 6.69 | ||||||||||||||||||||||||||||||||||||||||||
| Total | $ | 7.34 | $ | 7.24 | $ | 7.31 | $ | 7.33 | $ | 7.32 | $ | 7.26 | $ | 7.32 | $ | 7.36 | ||||||||||||||||||||||||||||||||||
| (a) Slight variations in totals are due to rounding. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (b) Other includes hospitality, resort and indirect units | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (c) Net loss rate is net current period placements and disconnected units in service divided by prior period ending units in service. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| SPOK HOLDINGS, INC. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| RECONCILIATION FROM NET (LOSS) INCOME TO EBITDA (a) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited and in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| For the three months ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | 12/31/2018 | ||||||||||||||||||||||||||||||||||||||||||||||
| Reconciliation of net (loss) income to EBITDA: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) (b) | $ | 3,165 | $ | 3,759 | $ | (4,539) | $ | (9,511) | $ | (1,326) | $ | (670) | $ | 742 | $ | 189 | |||||||||||||||||||||||||||||||||||||
| (Less) plus: benefit from (provision for) income taxes | (155) | (353) | 657 | (2,172) | (804) | (268) | 586 | (5) | |||||||||||||||||||||||||||||||||||||||||||||
| (Less) plus: Other expense (income) | (151) | (101) | 137 | (206) | (163) | (602) | 236 | 593 | |||||||||||||||||||||||||||||||||||||||||||||
| Less: Interest income | (127) | (146) | (363) | (350) | (399) | (452) | (449) | (628) | |||||||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) | 2,732 | 3,159 | (4,108) | (12,239) | (2,692) | (1,992) | 1,115 | 149 | |||||||||||||||||||||||||||||||||||||||||||||
| Plus: depreciation, amortization and accretion | 2,335 | 2,072 | 2,146 | 2,250 | 2,305 | 2,335 | 2,359 | 2,601 | |||||||||||||||||||||||||||||||||||||||||||||
| EBITDA | $ | 5,067 | $ | 5,231 | $ | (1,962) | $ | (9,989) | $ | (387) | $ | 343 | $ | 3,474 | $ | 2,750 | |||||||||||||||||||||||||||||||||||||
| Less: capitalized software development costs | (2,906) | (3,596) | (1,705) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Plus: stock-based compensation | 1,616 | 1,362 | 1,182 | 1,121 | 964 | 1,029 | 528 | 1,032 | |||||||||||||||||||||||||||||||||||||||||||||
| Plus: goodwill impairment | — | — | — | 8,849 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 3,777 | $ | 2,997 | $ | (2,485) | $ | (19) | $ | 577 | $ | 1,372 | $ | 4,002 | $ | 3,782 | |||||||||||||||||||||||||||||||||||||
| For the nine months ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 9/30/2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Reconciliation of net income (loss) to EBITDA: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | $ | 2,384 | $ | (1,255) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Plus (less): Benefit from (provision for) income taxes | 149 | (486) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Less: Other (expense) income | (113) | (528) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Less: Interest income | (636) | (1,300) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating loss | 1,784 | (3,569) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Plus: depreciation, amortization and accretion | 6,553 | 6,999 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| EBITDA | $ | 8,337 | $ | 3,430 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Less: capitalized software development costs | (8,206) | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Plus: stock-based compensation | 4,160 | 2,521 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 4,291 | $ | 5,951 | |||||||||||||||||||||||||||||||||||||||||||||||||
| RECONCILIATION FROM OPERATING EXPENSES TO ADJUSTED OPERATING EXPENSES (a) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| For the three months ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 9/30/2020 | 6/30/2020 | 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | 12/31/2018 | ||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating expenses | $ | 34,961 | $ | 32,580 | $ | 41,375 | $ | 51,787 | $ | 42,145 | $ | 41,517 | $ | 40,649 | $ | 43,107 | |||||||||||||||||||||||||||||||||||||
| Less: depreciation, amortization and accretion | 2,335 | 2,072 | 2,146 | 2,250 | 2,305 | 2,335 | 2,359 | 2,601 | |||||||||||||||||||||||||||||||||||||||||||||
| Less: goodwill impairment | — | — | — | 8,849 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Add: capitalized software development costs | 2,906 | 3,596 | 1,705 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Adjusted operating expenses | $ | 35,532 | $ | 34,104 | $ | 40,934 | $ | 40,688 | $ | 39,840 | $ | 39,182 | $ | 38,290 | $ | 40,506 | |||||||||||||||||||||||||||||||||||||
| (a) Slight variations in totals are due to rounding. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (b) An adjustment to cost of revenue identified in the fourth quarter of 2018 of $771 has been reflected in this table as a reduction of Net (loss) income of $166, $196, $359, and $771 in the first, second, third, and fourth quarters respectively. | |||||||||||||||||||||||||||||||||||||||||||||||||||||