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Exhibit 99.1
PRO FORMA FINANCIAL INFORMATION
INDEX
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PAGE
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<S> <C>
Description of Pro Forma Financial Information........................... P-2
Unaudited Pro Forma Consolidated Condensed Statement of Operations for
the Year ended December 31, 1999........................................ P-3
Notes to Unaudited Pro Forma Financial Information....................... P-4
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P-1
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PRO FORMA FINANCIAL INFORMATION
The accompanying pro forma financial information gives effect to the
September 1999 acquisition of Atcom, Inc. for approximately $42.6 million in
common stock, stock options and direct acquisition costs as if such transaction
had been consummated on January 1, 1999. The Atcom, Inc. acquisition was
accounted for under the purchase method of accounting for business
combinations. The pro forma consolidated condensed financial information does
not include the effects of the acquisition of Business Anywhere USA, Inc. as
the impact of the acquisition is not significant to the consolidated condensed
pro forma results for the period presented. The pro forma consolidated
condensed financial information is presented for illustrative purposes only and
is not necessarily indicative of what CAIS Internet, Inc.'s results of
operations would have been had the above-referenced transaction been
consummated as of the above-referenced date or results of operations that may be
reported by CAIS Internet, Inc. in the future. The pro forma adjustments are
based upon available information and, in the opinion of management, all
adjustments have been made that are necessary to present fairly the pro forma
data.
The following data should be read in conjunction with CAIS Internet, Inc.'s
and Atcom, Inc.'s Consolidated Financial Statements and related notes included
in CAIS Internet, Inc.'s filings with the Securities and Exchange Commission.
P-2
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CAIS INTERNET, INC.
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
For the Year Ended December 31, 1999
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Historical Results
-------------------------------
Atcom
(Through Date of Pro Forma Pro Forma
CAIS Internet Acquisition Only) Adjustments CAIS Internet
------------- ----------------- ----------- -------------
<S> <C> <C> <C> <C>
Net revenues............ $ 10,784 $ 1,202 $ 11,986
Cost of revenues........ 9,689 461 10,150
Operating expenses:
Selling, general and
administrative....... 39,693 3,002 42,695
Research and
development.......... 1,593 604 2,197
Depreciation and
amortization......... 7,666 46 $ 9,307(1) 17,019
Fair value of stock
issued to third party
for services......... 723 -- 723
Non-cash
compensation......... 4,892 -- 4,892
-------- ------- ------- --------
Total operating
expenses........... 54,567 3,652 9,307 67,526
-------- ------- ------- --------
Loss from operations.... (53,472) (2,911) (9,307) (65,690)
Interest income
(expense), net:
Interest income....... 2,419 37 2,456
Interest expense...... (1,384) (136) (1,520)
-------- ------- ------- --------
Total interest
income
(expense), net..... 1,035 (99) -- 936
-------- ------- ------- --------
Loss from continuing
operations
before income taxes ... (52,437) (3,010) (9,307) (64,754)
Provision for income
taxes................ -- -- --
-------- ------- ------- --------
Loss from continuing
operations............. (52,437) (3,010) (9,307) (64,754)
Loss from discontinued
operations........... (340) -- (340)
-------- ------- ------- --------
Loss before
extraordinary item..... (52,777) (3,010) (9,307) (65,094)
Extraordinary item--
early extinguishment
of debt.............. (551) -- (551)
-------- ------- ------- --------
Net loss................ (53,328) (3,010) (9,307) (65,645)
Dividends and
accretion of
preferred stock...... (4,520) -- (4,520)
-------- ------- ------- --------
Net loss attributable to
common stockholders.... $(57,848) $(3,010) $(9,307) $(70,165)
======== ======= ======= ========
Basic and diluted
earnings (loss) per
share:
Loss attributable to
common stockholders
before discontinued
operations and
extraordinary item... $ (3.54) $ (3.72)
Discontinued
operations........... (0.02) (0.02)
Extraordinary item.... (0.03) (0.03)
-------- --------
Total............... $ (3.59) $ (3.77)
======== ========
Weighted-average common
shares outstanding--
basic and diluted...... 16,124 2,493(2) 18,617
======== ======= ========
</TABLE>
The accompanying notes are an integral part of this unaudited pro forma
consolidated condensed statement.
P-3
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NOTES TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
The unaudited pro forma financial information is based on the following
assumptions and adjustments :
(1) Reflects the amortization over a three-year life of the excess of purchase
price and intangibles of Atcom of $41.9 million over the fair market value
of net assets acquired.
(2) Reflects common shares issued in connection with the Atcom transaction.
P-4
