ELMWOOD PARK, N.J., Feb. 15, 2007 (PRIME NEWSWIRE) -- Berliner Communications, Inc. (OTCBB:BERL) ("Berliner") today announced financial results for the three and six months ended December 31, 2006, and the closing of a $1.5 million investment, representing the final installment of a $6.0 million financing round.
Highlights for the Quarter ended December 31, 2006 and Early 2007:
* Revenues for the quarter increased 75% over first quarter of fiscal 2007; * Closed on strategic investments totaling $6.0 million; * Received new purchase orders for significant project in the New Jersey and New York region; and * Opened new location in Boston, Massachusetts and expanded operations in Fort Lauderdale, Florida.
"We are extremely pleased with our operating results for the quarter and the year so far, the success of our capital raising initiatives, and the receipt of additional business from our existing carrier customers," said Rich Berliner, Berliner's Chairman and CEO. "I believe that our financial performance reflects our commitment to customer service, and we are dedicated to doing a great job for our customers. The closing of our investments gives us additional financial resources to fund our growth and seek strategic acquisitions and opportunities."
Financial Results
Revenues for the company for the quarter ended December 31, 2006 were $13.7 million, as compared with $7.8 million for the quarter ended September 30, 2006 and $11.1 million for the quarter ended December 31, 2005. Berliner reported net income allocable to common shareholders of $1.2 million, or $0.07 per basic share and $0.06 per diluted share in the three months ended December 31, 2006, as compared to net income allocable to common shareholders of $448,400, or $0.03 per basic and diluted share, for the three month period ended December 31, 2005.
Berliner reported net income allocable to common shareholders for the six months ended December 31, 2006, of $591,400, on revenues of $21.5 million, or $0.03 per basic and diluted share. Berliner reported net income of $709,900, or $0.07 per basic and diluted share before the effect of the deemed dividend associated with the September 2005 recapitalization of Berliner in the six months ended December 31, 2005 on revenues of $19.8 million. After recording the deemed dividend of $19.9 million on the conversion of our Series B and Series D Convertible Preferred Stock, the net loss allocable to common shareholders was $19.2 million or $1.89 per basic and diluted share for the six months ended December 31, 2005.
We currently report our financial results on the basis of two reportable segments: (1) infrastructure construction and technical services and (2) real estate acquisition and zoning. The following represents our revenues and operating income (loss) for each segment for the three and six months ended December 31, 2006, and 2005, respectively:
Three months ended Six months ended
December 31, December 31,
------------------------ ------------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues:
Infrastructure
construction
and technical
services $11,339,460 $10,656,087 $16,711,473 $18,612,728
Real estate
acquisition
and zoning 2,348,556 439,794 4,766,030 1,128,954
Other (432) 11,542 15,245 23,106
----------- ----------- ----------- -----------
Total $13,687,584 $11,107,423 $21,492,748 $19,764,788
=========== =========== =========== ===========
Operating income
(loss):
Infrastructure
construction
and technical
services $ 1,094,595 $ 329,044 $ 248,725 $ 751,526
Real estate
acquisition
and zoning 588,862 (130,850) 873,860 (219,100)
Other 359 17,273 9,512 18,223
----------- ----------- ----------- -----------
$ 1,683,816 $ 215,467 $ 1,132,097 $ 550,649
=========== =========== =========== ===========
Strategic Investments
On February 15, 2007, Berliner closed on a $1.5 million financing through the issuance of a 7% Convertible Note due 2008 (the "Note") to Sigma Berliner, LLC, an affiliate of Sigma Opportunity Fund. This represents the final tranche of a series of investment rounds, which began with a $3.0 million investment by Sigma Opportunity Fund that closed December 29, 2006 and was followed by investments of $1.0 million by Pacific Asset Partners, LP and $500,000 by Operis Partners I, LLC on substantially the same terms, bringing the total investment amount to $6.0 million before fees and expenses. Under the terms of the Notes issued to these parties, Berliner will pay interest quarterly at a rate of 7.0% per annum, with principal due at maturity. The Notes are convertible into Berliner common stock at a price of $1.10 per share, subject to adjustments for certain events as set forth in the Notes. Berliner will also issue warrants to each of the noteholders. Punk, Ziegel & Company served as adviser and placement agent for the company.
Also in connection with the December 29, 2006 financing, the Berliner Board of Directors elected Thom Waye, Managing Director of the Sigma Opportunity Fund, to serve on the Board. Mr. Waye commented, "Rich has built an outstanding organization, which is poised to attain further aggressive, profitable growth in the expanding wireless infrastructure market. We at Sigma, Operis and Pacific Asset Partners are proud to have joined the Berliner team and are committed to increasing shareholder value".
Expanded Operations
In February 2007, the Company opened a new office in Boston, Massachusetts, in an effort to further support existing customers with operations in the region and expand and diversify its customer base by developing relationships with new carrier customers in the region. James Davis, an experienced wireless industry executive, will supervise the office and lead this effort. In addition, the Company has signed a new lease for expanded office and warehouse space in Pompano Beach, Florida, and expects to hire additional management level resources to support its operations in this part of the state.
"Our new office in Boston is an extension of our strong position in the Northeast," said Mr. Berliner. "James brings the experience and contacts we need to develop relationships and provide hands on service to new and existing customers in this area." Mr. Berliner added, "Our new office in Florida, coupled with our expanded hiring activity in the area, is designed specifically to demonstrate to our customers in the region that we are 100% committed to servicing their needs."
About Berliner Communications, Inc.
Berliner Communications, Inc. and its wholly owned operating subsidiary, BCI Communications, Inc., are headquartered in Elmwood Park, New Jersey. BCI is an end-to-end provider of outsourced services for the wireless communications industry, including planning, deployment and management of network build-outs. BCI provides wireless carriers with comprehensive real estate site acquisition and zoning services, radio frequency and network design and engineering, infrastructure equipment construction and installation, radio transmission base station modification and project management services. For more information about Berliner's services, please visit www.bcisites.com.
The statements in this press release, which are not historical fact, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, without limitation, statements regarding our future prospects, the ability to achieve our sales and profitability goals, our perception of future industry trends and the potential positive impact our business prospects, and other such statements. Such statements involve risks and uncertainties that could cause actual results to differ materially from ours expectations. Such risks and uncertainties include, without limitation, risks detailed in our filings with the United States Securities and Exchange Commission, the risk that future trends we have identified do not materialize or if they materialize that they do not have the beneficial effect we anticipate, as well as the risk that we will not be able to achieve our sales and profitability goals. All forward-looking statements in this document are made as of the date hereof, based on information available to us on the date hereof, and we disclaim any intention or obligation to revise any forward-looking statements, including, without limitation, financial estimates, whether as a result of new information, future events or otherwise.
BERLINER COMMUNICATIONS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended Six months ended
December 31, December 31,
------------------------ ------------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues $13,687,584 $11,107,423 $21,492,748 $19,764,788
Costs of revenues 8,657,705 8,588,115 14,374,284 14,805,665
----------- ----------- ----------- -----------
Gross margin 5,029,879 2,519,308 7,118,464 4,959,123
Selling, general
and administrative
expenses 3,283,849 2,241,441 5,864,757 4,285,188
Depreciation and
amortization 62,214 62,909 119,093 124,045
(Gain) loss on sale
of fixed assets - (509) 2,517 (759)
----------- ----------- ----------- -----------
Income from
operations 1,683,816 215,467 1,132,097 550,649
Other (income) expense
Interest expense 25,572 17,292 54,645 26,863
Interest income (3,801) (3,342) (8,411) (6,188)
Gain on sale of
equity of invest-
ment, net of
losses - (163,742) - (97,995)
Other - (85,399) (14,488) (84,999)
----------- ----------- ----------- -----------
Income before
income taxes 1,662,045 450,658 1,100,351 712,968
Income tax expense 508,926 2,250 508,926 3,050
----------- ----------- ----------- -----------
Net income $ 1,153,119 $ 448,408 $ 591,425 $ 709,918
Deemed Series B and
D preferred
dividends - - - 19,935,779
----------- ----------- ----------- -----------
Net income (loss)
allocable to common
shareholders $ 1,153,119 $ 448,408 $ 591,425 $(19,225,861)
=========== =========== =========== ===========
Net income (loss)
per share - basic
and diluted
Basic $ 0.07 $ 0.03 $ 0.03 $ (1.89)
=========== =========== =========== ===========
Diluted $ 0.06 $ 0.03 $ 0.03 $ (1.89)
=========== =========== =========== ===========
Weighted average
number of shares
outstanding
Basic 17,035,140 17,034,857 17,034,998 10,185,125
=========== =========== =========== ===========
Diluted 18,576,196 17,034,857 17,272,929 10,185,125
=========== =========== =========== ===========
BERLINER COMMUNICATIONS, INC.
CONSOLIDATED BALANCE SHEETS
December 31, June 30,
2006 2006
------------ ------------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 3,646,043 $ 534,350
Accounts receivable, net of allowance
for doubtful accounts of $189,423 at
December 31, 2006 and $179,535 at
June 30, 2006 12,826,548 12,333,892
Inventories 366,528 322,029
Prepaid expenses and other
current assets 204,085 331,546
------------ ------------
17,043,204 13,521,817
LONG-TERM ASSETS
Property and equipment, net 519,261 565,592
Debt issuances costs, net 528,636 -
Other assets 116,186 168,210
------------ ------------
$ 18,207,287 $ 14,255,619
============ ============
LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Line of credit $ 501,750 $ 1,110,803
Current portion of long-term debt 132,281 373,856
Current portion of capital lease
obligations 32,436 33,105
Accounts payable 4,755,303 5,355,827
Accrued liabilities 5,166,603 3,908,803
Accrued income taxes 442,244 127,927
------------ ------------
11,030,617 10,910,321
------------ ------------
LONG-TERM LIABILITIES
Long-term debt, net of debt discount
and current portion 2,384,660 162,769
Long-term capital lease obligations,
net of current portion 26,460 24,081
------------ ------------
2,411,120 186,850
------------ ------------
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' EQUITY
Preferred stock - -
Common stock 341 341
Additional paid-in capital 14,033,918 13,018,241
Accumulated deficit (9,268,709) (9,860,134)
------------ ------------
4,765,550 3,158,448
------------ ------------
$ 18,207,287 $ 14,255,619
============ ============