Unwired reports 42,200 subs at 31 December

Stuart Corner
Wednesday, 22 February 2006 14:01

IT Industry - Strategy

Unwired has released its results for the half year to 31 December 2005, reporting subscriber numbers of 42,200, up from 28,100 at 30 June. The company has previously said it needs 70,000 in Sydney to break even.

For the half year the company reported revenues of $10.86 million comprising primarily of operating revenue from wireless modem sales and monthly service subscriptions. This compares to $7.20 million for the previous six months and $4.28 million for the corresponding period in 2004. Expenses from ordinary operating activities before depreciation and amortisation increased by 16 percent from $19.06 million to $22.14 million. Of this, $1.70 million was a non-recurring cost for fundraising and borrowing related to both the $15 million loans facility (now repaid) for a spectrum swap with Austar and the issue of $37 million convertible note to Intel.

The company's capital expenditure for the period was $3.03 million, "reflecting the ongoing expansion of its Sydney network to cater for increasing customer numbers." An additional five base station sites were added to its Sydney network over the period, bringing the total number of Sydney sites to 76. Extra capacity was also added to existing sites in high demand areas.

The net loss for the consolidated entity was $18.33 million, a five percent improvement on the previous six months and 20 percent improvement on the corresponding 2004 period.

The company has commenced rolling out its network in Melbourne. CEO David Spence said the company's aim was that at least 45 percent of Australians would be able to get Unwired by 2008. "We signalled last year that we wanted to raise an additional $35 million to push ahead as fast as possible with this rollout. This is still our intention...and we will raise this capital at the right time and the right price for our shareholders."

At 31 December the company had cash reserves of $29.4 million as a result of an equity injection of $37 million by Intel last year. Spence described this as "enough for us to maintain a robust business in Sydney and expand our network into other areas."