EchoStar Reports Record Fourth Quarter Results
LITTLETON, Colo.--(BUSINESS WIRE)--March 18, 1999--
EchoStar Reports Record Fourth Quarter Results
EchoStar Communications Corporation ("EchoStar") (NASDAQ: DISH;
DISHP) today reported that its 1998 fourth quarter revenue increased
more than 60% as compared to the fourth quarter of 1997. EchoStar's
fourth quarter revenues totaled $287 million and $179 million for the
three-month periods ended December 31, 1998, and December 31, 1997,
respectively. EchoStar also reported pre-marketing cash flow of $90
million for the three months ended December 31, 1998, as compared to
$53 million for the corresponding period in 1997. Earnings before
interest, taxes, depreciation and amortization ("EBITDA") during the
fourth quarter of 1998 totaled negative $45 million compared to
negative EBITDA of $9 million during the same period in 1997. EchoStar
experienced its strongest ever DISH Network subscriber growth during
the fourth quarter of 1998, adding 331,000 net subscribers for a
cumulative total of 1.94 million subscribers as of December 31, 1998.
As expected, operating and net losses for the quarter ended December 31, 1998, increased as compared to the corresponding period in 1997. EchoStar reported an operating loss of $70 million and $48 million for the three months ended December 31, 1998, and December 31, 1997, respectively. The Company's net losses totaled $113 million and $71 million during those same periods. These increases in EchoStar's net losses principally resulted from increases in marketing expenses (including subscriber acquisition costs) as well as increases in DISH Network operating expenses.
For the year ended December 31, 1998, EchoStar reported total
revenue of $983 million compared to $477 million for the corresponding
period in 1997. Pre-marketing cash flow totaled $300 million during
the year ended December 31, 1998, compared to $129 million during the
year ended December 31, 1997. EBITDA for the year ended December 31,
1998, totaled negative $20 million, compared to EBITDA of negative $51
million for the corresponding period in 1997. EchoStar's operating
loss for the year ended December 31, 1998, improved to $123 million
compared to $224 million reported during the corresponding period in
1997. The Company's net losses totaled $261 million and $313 million
during those same periods. The improvement in EchoStar's 1998 results
compared to 1997 is principally attributable to the increase in DISH
Network and ETC revenues.
For more information about EchoStar, visit the new investor
relations section of our website at www.echostar.com.
Statement under the Private Securities Litigation Reform Act of
1995: All statements contained herein, as well as statements made in
press releases and oral statements that may be made by EchoStar or by
officers, directors or employees of EchoStar acting on its behalf,
that are not statements of historical fact constitute "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors that could cause the
actual results of EchoStar to be materially different from historical
results or from any future results expressed or implied by such
forward-looking statements. Among the factors that could cause actual
results to differ materially are the following: a total or partial
loss of a satellite due to operational failures, space debris or
otherwise; a decrease in sales of digital equipment and related
services to international direct-to-home ("DTH") service providers; a
decrease in DISH Network subscriber growth; an increase in subscriber
acquisition costs; impediments to the retransmission of local or
distant broadcast network signals; lower than expected demand for
EchoStar's delivery of local broadcast network signals; an unexpected
business interruption due to the failure of third-parties to remediate
Year 2000 issues; the inability of EchoStar to retain necessary
authorizations from the Federal Communications Commission ("FCC"); an
increase in competition from cable, direct broadcast satellite
("DBS"), other satellite system operators, and other providers of
subscription television services; the introduction of new technologies
and competitors into the subscription television business; a merger of
existing DBS competitors; a change in the regulations governing the
subscription television service industry; the outcome of any
litigation in which EchoStar may be involved; failure to consummate
the transaction with News Corporation Limited ("News Corporation") and
MCI Telecommunications Corporation/WorldCom ("MCI") whereby EchoStar
Communications Corporation ("ECC," and together with its subsidiaries,
or referring to particular subsidiaries in certain circumstances,
"EchoStar" or the "Company") would issue equity securities in exchange
for two satellites that have not yet been completed or the failure of
such satellites to be successfully launched or to become operational
or a delay in such launch or operation; general business and economic
conditions; and other risk factors described from time to time in
EchoStar's reports filed with the Securities and Exchange Commission.
In addition to statements that explicitly describe such risks and
uncertainties, readers are urged to consider statements that include
the terms "believes," "belief," "expects," "plans," "anticipates,"
"intends" or the like to be uncertain and forward-looking. All
cautionary statements made herein should be read as being applicable
to all forward-looking statements wherever they appear. In this
connection, investors should consider the risks described herein.
EchoStar Communications Corp., headquartered in Littleton, Colo.,
includes three interrelated business units:
-- DISH Network is EchoStar's state-of-the-art DBS system that
offers customers over 300 channels of digital video and
CD-quality audio programming, fully MPEG-2/DVB compliant hardware
and installation.
-- EchoStar Technologies Corporation (ETC, formerly HTS - Houston
Tracker Systems, Inc.), designs, manufactures and distributes DBS
set-top boxes, antennas and other digital equipment for DISH
Network and various international customers that include
ExpressVu Canada and Telefonica's Via Digital system in Spain.
ETC also provides uplink-center design, construction oversight
and project-integration services for customers internationally.
-- Satellite Services provides the delivery of video, audio and data
services to business television customers and other satellite
users. These services include satellite uplink, satellite
transponder space-usage and other services. Satellite Services
also administers SKY VISTA, a direct broadcast satellite service
offering up to 27 channels of popular digital satellite
television programming to viewers in Alaska, Hawaii, Puerto Rico
and the U.S. territories in the Caribbean.
DISH Network currently serves over 2.1 million customers. DISH Network is a trademark of EchoStar Communications Corporation. HTS is a trademark of Houston Tracker Systems, Inc. DISH Network is located on the Internet at: http://www.dishnetwork.com.
SELECTED FINANCIAL DATA EchoStar Communications Corporation (Nasdaq National Market: DISH; DISHP) (In thousands, except subscribers and per share data)
Three Months Ended December 31, ------------------------------------ 1997 1998 ------------------------------------ (Unaudited) Statements of Operations Data Revenue: DISH Network: Subscription television services............................ $105,897 $209,770 Other................................ 10,277 1,718 ---------- ---------- Total DISH Network..................... 116,174 211,488 DTH equipment sales and integration services.................. 52,987 64,163 Satellite services..................... 3,256 6,512 C-band and other....................... 6,748 4,819 ---------- ---------- Total revenue............................ 179,165 286,982
Costs and Expenses: DISH Network Operating Expenses: Subscriber-related expenses.......... 46,267 86,206 Customer service center and other........................... 11,949 26,842 Satellite and transmission........... 4,887 8,200 ---------- ---------- Total DISH Network operating expenses.............................. 63,103 121,248 Cost of sales - DTH equipment and integration services.............. 35,278 43,099 Cost of sales - C-band and other....... 7,632 3,941 Marketing: Subscriber promotion subsidies....... 50,445 112,724 Advertising and other................ 10,759 22,292 ---------- ---------- Total marketing expenses............... 61,204 135,016 General and administrative............. 20,458 29,126 Amortization of subscriber acquisition costs..................... 26,192 - Depreciation and amortization.......... 13,227 24,684 ---------- ---------- Total costs and expenses................. 227,094 357,114 ---------- ---------- ---------- ---------- Operating loss........................... $(47,929) $(70,132) ---------- ---------- ---------- ---------- Net loss................................. $(71,013) $(113,308) ---------- ---------- ---------- ---------- Net loss attributable to common shares... $(78,551) $(122,494) ---------- ---------- ---------- ---------- Weighted-average common shares outstanding...................... 43,565 45,088 ---------- ---------- ---------- ---------- Basic and diluted loss per share......... $(1.80) $(2.72) ---------- ---------- ---------- ---------- Other Data EBITDA................................. $(8,510) $(45,448) ---------- ---------- ---------- ---------- DISH Network subscribers...............1,040,000 1,940,000 ---------- ---------- ---------- ----------
December 31, December 31, 1997 1998 ---------- ---------- Balance Sheets Data Cash, cash equivalents and marketable investment securities...... $420,514 $324,100 Restricted cash and marketable investment securities................. 187,762 183,657 Total assets...........................1,805,646 1,809,519 Total current liabilities.............. 310,580 431,444 Total long-term obligations, net of current portion................1,384,863 1,521,577
SELECTED FINANCIAL DATA EchoStar Communications Corporation (Nasdaq National Market: DISH; DISHP) (In thousands, except per share data)
Year Ended December 31, --------------------------- 1997 1998 ---------- ---------- Statements of Operations Data Revenue: DISH Network: Subscription television services..... $298,883 $669,310 Other................................ 45,367 13,722 ---------- ---------- Total DISH Network..................... 344,250 683,032 DTH equipment sales and integration services.................. 91,637 256,193 Satellite services..................... 11,135 22,366 C-band and other....................... 30,396 21,075 ---------- ---------- Total revenue............................ 477,418 982,666
Costs and Expenses: DISH Network Operating Expenses: Subscriber-related expenses.......... 143,574 296,923 Customer service center and other.... 35,137 72,496 Satellite and transmission........... 14,563 25,992 ---------- ---------- Total DISH Network operating expenses.. 193,274 395,411 Cost of sales - DTH equipment and integration services.................. 61,992 173,388 Cost of sales - C-band and other....... 23,909 16,496 Marketing: Subscriber promotion subsidies....... 145,061 272,523 Advertising and other................ 34,862 47,998 ---------- ---------- Total marketing expenses............... 179,923 320,521 General and administrative............. 69,315 97,105 Amortization of subscriber acquisition costs..................... 121,735 18,869 Depreciation and amortization.......... 51,541 83,767 ---------- ---------- Total costs and expenses................. 701,689 1,105,557 ---------- ---------- Operating loss...........................$(224,271) $(122,891) ---------- ---------- ---------- ---------- Net loss.................................$(312,825) $(260,882) ---------- ---------- ---------- ---------- Net loss attributable to common shares...$(321,267) $(296,097) ---------- ---------- ---------- ---------- Weighted-average common shares outstanding............................. 41,918 44,982 ---------- ---------- ---------- ---------- Basic and diluted loss per share......... $(7.66) $(6.58) ---------- ---------- ---------- ---------- Other Data EBITDA................................. $(50,995) $(20,255) ---------- ---------- ---------- ----------
CONTACT: EchoStar Communications Corporation
Judianne Atencio, 303/723-2010
judianne.atencio@echostar.com
KEYWORD: COLORADO
INDUSTRY KEYWORD: ENTERTAINMENT TELECOMMUNICATIONS COMED
COMPUTERS/ELECTRONICS EARNINGS