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Metrocall loss widens in 4Q

Metrocall Inc. (Nasdaq: MCLL) reported a hefty loss Tuesday of $1.10 a share for the quarter, beating First Call's estimate of $1.13 a share. The loss, however, was wider than the loss of $1.04 a share in 1998's comparable quarter.

Shares in the company closed at 13 Monday, after they surged on the heels of investments from wireless Internet companies. Metrocall, which recently transferred from the Nasdaq's national market to the small-cap market in September, saw its stock change direction last week after it received a $51 million investment from three companies. The company also announced that AT&T's Wireless Services (NYSE: T) unit would become its single largest shareholder.

The company reported a yearly loss of $4.47 a share, but said operations were profitable before acquisition related expenses. For the 12 months ended December 31, net loss was approximately $186.7 million, but there was $210.4 million in (non-cash) acquisition related amortization expenses.

The company's operating cash flow of $41.5 million for the quarter ended December 31, compared to $39.6 million for 1999's fourth quarter. Metrocall's EBITDA margin during the quarter rose to 30.2 percent. The company reported 50,564 new subscribers for the quarter.

In 1999, Metrocall produced $156.5 million of EBITDA, $571.1 million of net revenue and 268,389 net subscriber additions. The company also said it didn't increase its borrowings for the third consecutive quarter, and total debt declined from third quarter balances of $786.7 million to $777.6 million at December 31, 1999.

"We set out to use 1999 as a set-up year for 2000 and clearly we accomplished a great deal. We promised to de-lever through operations, reduce capital expenditures, reduce overall expenses, increase cash flow margin, develop and initiate new product offerings and generate free cash flow. On all accounts, we delivered on our promises," said president and CEO William L. Collins III, in a press release.

In 1999 the company completed the integration of the Advanced Messaging Division of AT&T Wireless which it acquired in October of 1998. It also began development of a new business unit, Inciscent, with which it plans to harness the wireless data market in 2000.

Metrocall is ahead of its competitors in the wireless data market in many respects, the company said. Its segmented customer base, large direct sales forces, and partnerships with companies such as AT&T Wireless, PSINet (Nasdaq: PSIX), Aether Systems (Nasdaq: AETH)and Hicks, Muse, Tate & Furst all give the company an edge, it said.