CLWR Notes

EPS Release 5/12/08

• Q1 Revenue 51.5m up 76% y/y and subscribers 443,000 up 72% y/y

• Successful expansion of service offerings to include residential voice in more markets

• Three additional markets turned EBITDA positive – total now 27 – was 10 last year

  • EBITDA margin up to 21% for initial markets (the 25 markets launched prior to 2006)

• Deployment of WiMAX in Portland Oregon making progress

• Combination of CLWR and Sprint’s mobile WiMAX business to close Q4 2008

• ARPU $36.86 – slightly above 35.80 from last year

• Consolidated churn 2.2% - domestic churn 2.0%

• Gross margins 26% versus 43% year ago – affected by launch of 7 large markets and promotional offerings

• EBITDA Loss of 81.2m versus 51.5 last year

  • Higher cost per gross addition, admin costs, spectrum lease expense

• Capex $53.1m versus 74.4m last year (decision in 2H 2007 to slow expansion)

• Did not add any new markets in 2008 – focus on efficiency and profitability in existing markets

• Initial markets (pre-2006) strong revenue growth (38%)and driven by subscriber growth as well as premium services

• Nearly 60% of domestic markets were EBITDA positive

• Long-term debt of $1.23 billion

• Funding gap required to finish nationwide build out estimated at 2-2.3 billion

Wachovia report 5/13/08

• Gross adds were better than expected but churn was also higher, resulting in relatively tame net adds

  • Management commentary churn should slightly increase in Q2

• 1/3 of markets have 15% plus household penetration and 2/3 of markets have 10% penetration rate.

• Forecasting 173,000 net adds in 2008 and 525,000 in 2009

• Concerns regarding 2.1-2.3 billion funding gap

EPS Release 3/5/09

-          Closed $3.2 bil financing round at $17 (early in 2008)

-          Completed transaction with Sprint – nationwide spectrum footprint

-          Wholesale distribution agreements with Sprint and leading cable companies

-          ARPU’s increasing despite industry declines

-          To launch “clear” mobile broadband service in new markets (Atlanta, Las Vegas, Philadelphia & Dallas/ft worth) & existing markets (Baltimore, Seatle, Honolulu and Charlotte)

-          Ability to cover up to 120 mil people by end of 2010 (NYC, DC, Houston and San Fran)

-          Flexibility to accelerate / decelerate expansion

-          Intel and other industry leaders to build WIMAX compatibility

o        Expect 100 WIMAX compatible devices by end of 2009

-          2009 & 2010 focus on development and expansion of 4G network

o        Net cash spend for 2009 at $1.5 bil to $1.9 bil

o        Managing cash resources into 2011 but can be flexible

o        Timing to be determined by business success and availability of capital

 

Wachovia Report 3/6/09

-          Net adds for Q4 were 5,000

-          ARPU $39.70 – up 10% y/y

-          First WIMAX launch in Portland appears to be a success

-          Most user growth will be tail end of 2009 after Las Vegas and Atlanta launch this summer.