SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 25, 1997
_________________________________
(Date of earliest event reported)
Paging Network, Inc.
______________________________________________________
(Exact name of Registrant as specified in its charter)
Delaware 0-19494 04-2740516
______________ _____________________ __________________
(State of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
4965 Preston Park Boulevard
Plano, Texas 75093
____________________________________________________________
(Address of principal executive offices, including zip code)
(972) 985-4100
____________________________________________________
(Registrant's telephone number, including area code)
n/a
_____________________________________________________________
(Former name or former address, if changed since last report)
Item 5. Other Events
On September 25, 1997, the Registrant issued the attached
press release.
Item 7. Financial Statements and Exhibits
99.1 Press Release, dated September 25, 1997
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this
Report to be signed on its behalf by the undersigned
hereunto duly authorized.
Dated: September 25, 1997
Paging Network, Inc.
By: /s/ John P. Frazee, Jr.
John P. Frazee, Jr.
Chairman, President and
Chief Executive Officer
By: /s/ G. Robert Thompson
G. Robert Thompson
Vice President - Finance
FOR IMMEDIATE RELEASE Contact: Jenny Haynes
(972) 985-6750
PAGENET REPORTS RESTATEMENT OF FINANCIALS FOR 1996
AND FIRST AND SECOND QUARTERS OF 1997
DALLAS, September 25, 1997 Paging Network, Inc. (Nasdaq: PAGE)
today reported that it is restating its consolidated financial statements
for 1996 and the first two quarters of 1997 to reflect a $22.5 million non-
cash write-off of pagers now deemed to be unrecoverable as of December 31,
1996. As a result, restated net loss for 1996 is $104.3 million compared
to $81.8 million as reported, or $1.02 loss per share compared to $0.80
loss per share as reported.
Furthermore, PageNet's units in service as of December 31, 1996
are being restated to 8,587,772 from 9,002,733. The pagers written-off
were not generating revenue at the end of 1996, and accordingly the write-
off does not reduce revenues previously reported for 1996. In addition,
average revenue per unit increases for all affected periods.
The decision to restate the company's financial statements
results from a review of PageNet's agreements with a national marketing
affiliate and the determination that an earlier judgment that the company
ultimately would recover or be compensated for certain pagers distributed
by that affiliate to customers who later discontinued service was not
correct.
As a result of the restatement, 1996 EBITDA is being reduced and
restated to $234.3 million from $256.8 million as previously reported due
to the $22.5 million non-cash provision to write-off pagers. In addition,
PageNet stated that it is not in default under its financial covenants, and
is in discussions with the banks under its senior credit facility regarding
the effect, if any, of the restatement of its financial statements on the
credit facility.
"The changes being reported today are part of an ongoing review
of all aspects of the company's business which began after I assumed my
current position with the company," said John P. Frazee, Jr., chairman,
president and chief executive officer. "We are reviewing and implementing
procedures to help assure the accuracy of our information, and we are
committed to having policies and procedures in place in the future that
will eliminate the need to take the kind of action we are taking today."
Certain financial highlights of the company for 1996 and the
first two quarters of 1997 as previously reported and as restated follow:
HIGHLIGHTS (Consolidated domestic and international)
(in thousands, except margins and units)
<TABLE>
<CAPTION>
1st Qtr 2nd Qtr
1996 1997 1st Qtr 1997 2nd Qtr
Previously 1996 as Previously 1997 as Previously 1997 as
Reported Restated Reported Restated Reported Restated
<S> <C> <C> <C> <C> <C> <C>
Net Revenues $ 705,840 $ 705,840 $ 193,891 $ 193,891 $ 205,422 $ 204,445
EBITDA* 256,837 234,337 64,280 64,280 75,024 75,380
EBITDA Margin 36.4% 33.2% 33.2% 33.2% 36.5% 36.9%
Net Gains in Units in Service 2,264,826 1,849,865 517,059 544,723 538,149 621,141
Total Units in Service 9,002,733 8,587,772 9,519,792 9,132,495 10,057,941 9,753,636
</TABLE>
____________
* EBITDA is defined as earnings before interest, income taxes,
depreciation, amortization, and equity in loss of an unconsolidated
subsidiary.
Set forth in the table below is certain financial data from the
company's Consolidated Statements of Operations as previously reported and
as restated. The restated financial statements will be filed with the
Securities and Exchange Commission as soon as practicable.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Year 3 Months 6 Months 6 Months
Ended Year Ended 3 Months Ended Ended
12/31/96 Ended 3/31/97 Ended 6/30/97 6/30/97
Previously 12/31/96 as Previously 3/31/97 as Previously as
Reported Restated Reported Restated Reported Restated
---------- ----------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Total Revenues $822,487 $822,487 $225,248 $225,248 $459,475 $458,498
Depreciation &
Amortization 213,440 213,440 67,068 64,468 138,928 133,728
Provision to Write-
off Pagers - 22,500 - - - -
Total Operating
Expenses 662,443 684,943 196,679 194,079 398,937 392,404
Operating Income 43,397 20,897 (2,788) (188) 376 5,932
Net Loss (81,820) (104,320) (39,914) (37,314) (90,377) (84,821)
Net Loss per Share (0.80) (1.02) (0.39) (0.36) (0.88) (0.83)
</TABLE>
PageNet provides service to paging users in the United States and
Canada through its coast to coast network of sales and service offices,
resellers and affiliates. PageNet services include alphanumeric and
numeric messaging with local, regional and nationwide coverage options.
The company is the exclusive wireless provider of CNN news, sports and
stock headlines. For further information about PageNet and its products
and services, visit the company's web site at WWW.PAGENET.COM.
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