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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
Date of Report
July 26, 1999
WESTERN WIRELESS CORPORATION
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(Exact Name of Registrant as Specified in Charter)
Washington
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(State or Other Jurisdiction of Incorporation)
000-28160 91-1638901
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(Commission File Number) (IRS Employer Identification No.)
3650 131st Avenue SE
Bellevue, WA 98006
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(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code: (425) 586-8700
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS
On July 26, 1999, Western Wireless Corporation issued the following press
release:
FOR IMMEDIATE RELEASE
FOR FURTHER INFORMATION CONTACT:
Investment Community: Media:
Gina Haggerty John Snyder
(425) 586-8671 Snyder Buscher Group
[email protected] (206) 652-9704
[email protected]
WESTERN WIRELESS ANNOUNCES SECOND QUARTER 1999 FINANCIAL RESULTS
- CASH FLOW OF $61.7 MILLION FOR THE SECOND QUARTER -
- 42,100 INCREASE IN SUBSCRIBERS DURING THE SECOND QUARTER OF 1999 -
BELLEVUE, Wash. (July 26, 1999) -- Western Wireless Corporation (NASDAQ:
WWCA), a leading provider of cellular services, announced today its financial
and operating results for the second quarter ended June 30, 1999.
"Our partnership with rural America continues to thrive. The demand for
accessible and quality telecommunication service in rural markets has never been
stronger, and our ability to deliver has never been better," said John W.
Stanton, chairman and chief executive officer of Western Wireless. "The company
experienced increased subscriber growth, higher average revenue and record cash
flow. EBITDA (operating income before non-cash charges) exceeded $60 million and
we achieved a 47% margin during the second quarter of 1999, a 72 percent
increase from the same quarter in 1998."
"Internationally, we achieved two milestones this quarter," continued
Stanton. "Western Wireless International celebrated the one year anniversary of
service in Iceland and also noted the achievement of more than 120,000
subscribers in 3 countries."
Mikal Thomsen, president and chief operating officer of Western
Wireless, added, "Our recent acquisition of the McAllen and Brownsville MSA's
provides us with additional growth opportunities in Texas. We continue to grow
our footprint as well as our cashflow and subscribers." The purchase of the Rio
Grande Valley was completed at a cost of $96 million.
COMPANY RESULTS
At the end of the second quarter 1999, the company reported total
revenues of $136.6 million, up 39 percent over the same quarter a year ago. Net
loss from continuing operations was $55.7 million for the quarter ended June 30,
1999, a loss of $0.73 per share. Net loss for the
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quarter ended June 30, 1999 was $47.9 million, a loss of $0.63 per share. A
non-cash expense of $66.5 million was recognized for the restructuring of
employee stock options in connection with the spin-off of VoiceStream Wireless
on May 3, 1999; a favorable adjustment to the prior estimated loss from the
VoiceStream discontinued operations in the amount of $7.7 million was also
recognized.
Subscribers increased by 42,100, including 5,200 from the Rio Grande
Valley acquisition, to 737,600 during the second quarter of 1999, a 27 percent
year to year increase. Service revenues for the second quarter of 1999 increased
38 percent from the same quarter a year ago to $131 million. EBITDA for the
quarter was $61.7 million, a 72 percent increase over the second quarter of
1998. Capital expenditures were $38.3 million for the quarter. Over $23 million
in free cash flow (EBITDA less capital expenditures) was generated during the
second quarter of 1999.
Western Wireless International operating companies in Latvia, Georgia,
and Iceland continued their impressive growth in the second quarter of 1999,
increasing subscribers by over 25% to 120,000. The Iceland operation celebrated
its first anniversary in May, achieving record penetration. WWI launched service
in Croatia on July 1st and the Haiti launch is on schedule for third quarter
1999.
Based in Bellevue, Wash., Western Wireless Corp. is a leading provider
of wireless communications services in the western United States and
international locations. It currently offers cellular service marketed under the
Cellular One(R) name in 17 western states. Through its subsidiaries, Western
Wireless holds licenses to offer wireless service in 7 countries.
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WESTERN WIRELESS CORPORATION
SUPPLEMENTARY FINANCIAL AND OPERATIONAL DATA
(Dollars in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
---------------------------- ----------------------------
1999 1998 1999 1998
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Subscriber revenues $ 95,268 $ 80,757 $ 182,202 $ 156,860
Roamer revenues 34,431 13,210 57,681 23,697
Equipment sales and other revenues 6,852 4,437 12,531 8,477
------------ ------------ ------------ ------------
Total revenues 136,551 98,404 252,414 189,034
------------ ------------ ------------ ------------
Operating expenses:
Cost of service 15,448 13,711 30,952 25,598
Cost of equipment sales 8,061 7,525 15,824 14,977
General and administrative 28,848 21,786 55,552 42,048
Sales and marketing 22,446 19,444 43,906 36,935
Depreciation and amortization 26,604 17,492 49,045 35,042
Stock based compensation 66,496 66,496
------------ ------------ ------------ ------------
Total operating expenses 167,903 79,958 261,775 154,600
------------ ------------ ------------ ------------
Operating income (loss) from continuing operations (31,352) 18,446 (9,361) 34,434
------------ ------------ ------------ ------------
Other income (expense):
Interest and financing expense, net (23,504) (24,276) (46,800) (44,297)
Equity in net loss of unconsolidated affiliates (2,924) (2,524) (7,685) (4,605)
Other, net 1,380 807 2,027 1,319
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Total other income (expense) (25,048) (25,993) (52,458) (47,583)
------------ ------------ ------------ ------------
Minority interest in net loss of consolidated subsidiaries 747 939
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Net loss from continuing operations $ (55,653) $ (7,547) (60,880) (13,149)
============ ============ ============ ============
Net (loss) from discontinued operations 7,709 (45,493) (82,152) (104,041)
Cost of discontinuance (18,500)
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Total discontinued operations 7,709 (45,493) (100,652) (104,041)
------------ ------------ ------------ ------------
Net loss $ (47,944) $ (53,040) $ (161,532) $ (117,190)
============ ============ ============ ============
Basic loss per common share
Continuing operations (0.73) (0.10) (0.79) (0.17)
Total discontinued operations 0.10 (0.60) (1.31) (1.37)
------------ ------------ ------------ ------------
Basic loss per common share $ (0.63) $ (0.70) $ (2.10) $ (1.54)
============ ============ ============ ============
Weighted average common shares used in computing
basic loss per common share 76,611,000 75,831,000 76,734,000 75,804,000
============ ============ ============ ============
Comprehensive income (loss)
Net loss (47,944) (161,532)
Other comprehensive income:
Foreign currency translation adjustment (333) (181)
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Total Comprehensive loss $ (48,277) $ (161,713)
============ ============
Supplemental data:
EBITDA (operating income before non-cash charges) $ 61,748 $ 35,938 $ 106,180 $ 69,476
============ ============ ============ ============
Ending Subscribers 737,600 583,300 737,600 583,300
============ ============ ============ ============
</TABLE>
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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.
WESTERN WIRELESS CORPORATION
Dated: July 26, 1999
By /s/ Alan R. Bender
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Alan R. Bender
Senior Vice President,
General Counsel and Secretary
