UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

 

Commission File Number:  000-29678

 

INTRADO INC.

(Exact name of registrant as specified in its charter)

 

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ý    No o

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes ý    No o

 

As of May 5, 2005, there were 17,651,136 shares of common stock outstanding.

 

 

CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend the forward-looking statements throughout the Quarterly Report on Form 10-Q and the information incorporated by reference to be covered by the safe harbor provisions for forward-looking statements.  All projections and statements regarding our expected financial position and operating results, our business strategy, our financing plans and the outcome of any contingencies are forward-looking statements. These statements can sometimes be identified by our use of forward-looking words such as “may,” “believe,” “plan,” “will,” “anticipate,” “estimate,” “expect,” “intend,” and other words and phrases of similar meaning.  Known and unknown risks, uncertainties and other factors could cause the actual results to differ materially from those contemplated by the statements.  The forward-looking information is based on information available as of the date of this report on Form 10-Q and on numerous assumptions and developments that are not within our control.  Although we believe these forward-looking statements are reasonable, we cannot assure you they will turn out to be correct.  Actual results could be materially different from our expectations due to a variety of factors, including the following:

 

•                  Our reliance on large contracts from a limited and potentially decreasing number of significant telecommunications customers and their ability to pay for our services, especially in light of recent competitive pressures in the telecommunications industry;

 

•                  Whether acquisitions, consolidations, bankruptcies and reorganizations among our telecommunications customers will result in volume pricing discounts or otherwise have a material adverse effect on our market share, revenue and liquidity;

 

•                  Competition in service, price and technological innovation from entities with substantially greater resources, especially in light of the fact that the increased use of Voice over Internet Protocol (VoIP) technology may open our traditional 9-1-1 data management services business to new competition;

 

•                  Our ability to enter or renew wireline, VoIP and wireless contracts at prices that will allow us to maintain current profit margins;

 

•                  Our ability to integrate businesses and assets that we have acquired or may acquire;

 

•                  Whether our efforts to expand into European and other international markets will prove to be economically viable and whether we will be able to generate revenue sufficient to recover our investment in bmd wireless AG;

 

•                  Adverse trends in the telecommunications industry in general, including bankruptcy filings by our customers and other factors that are beyond our control;

 

•                  Whether our investments in research and development and capitalized software will expand our service offerings and prove to be economically viable;

 

•                  Constraints on our sales and marketing channels because many of our customers compete with each other;

 

•                  Our ability to accurately predict, control and recoup the large amount of up-front expenditures necessary to serve new customers and possible delays in sales cycles;

 

•                  Our ability to expand beyond our traditional business and into highly competitive notification and data management sectors, including, but not limited to, our efforts to employ IntelliCast^® Target Notification and Commercial Database (CDB) services;

 

•                  The unpredictable rate of adoption of wireless 9-1-1 services, including further delays in the Federal Communications Commission’s mandated deployment of Phase I and Phase II wireless location services;

 

•                  The potential for liability claims, including product liability claims relating to our software and services;

 

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•                  Technical difficulties and network downtime, including those caused by sabotage or unauthorized access to our systems;

 

•                  Changes in interest rates, including the LIBOR and prime rate and their potentially adverse effect on our results of operations and cash flows;

 

•                  The possibility that we will not generate taxable income in an amount sufficient to allow us to utilize previously generated net operating loss carryforwards or research and development tax credits;

 

•                  Our ability to economically attract, motivate and retain high-quality employees with skills that match our business needs;

 

•                  Developments in telecommunications regulation and the unpredictable manner in which existing or new legislation and regulation may be applied to our business;

 

•                  The potential impact of  recent accounting pronouncements related to share-based payments on our prospective and historical financial statements; and

 

•                  Developments in governance, accounting and financial regulations, including Section 404 of the Sarbanes-Oxley Act of 2002 and their impact on general and administrative expenses.

 

This list is intended to identify some of the principal factors that could cause actual results to differ materially from those described in the forward-looking statements included elsewhere in this report. These factors are not intended to represent a complete list of all risks and uncertainties inherent in our business, and should be read in conjunction with the more detailed risks included in our 2004 Annual Report on Form 10-K under the caption “Item 1. Business—Risk Factors,” our other Securities and Exchange Commission filings and our press releases.

 

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INDEX
PART I – FINANCIAL INFORMATION
Item 1 – Financial Statements:
Consolidated Statements of Operations for the three months ended March 31, 2005 and 2004
Consolidated Balance Sheets as of March 31, 2005 and December 31, 2004
Consolidated Statements of Cash Flows for the three months ended March 31, 2005 and 2004.
Notes to Consolidated Financial Statements.
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 3 – Quantitative and Qualitative Disclosures About Market Risk
Item 4 – Controls and Procedures
PART II – OTHER INFORMATION
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds
Item 5 – Other Information
Item 6 – Exhibits and Reports on Form 8-K
Signatures
Certifications

 

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PART I - - FINANCIAL INFORMATION

 

INTRADO INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in Thousands, Except Per Share Data)

 

		Three Months Ended March 31,
		2005			2004
Revenues (see Note 1):
Wireline		$	23,082		$	18,693
Wireless		14,482			10,862
Total revenues		37,564			29,555
Costs and expenses:
Direct costs—Wireline		13,550			10,326
Direct costs—Wireless		7,259			5,804
Sales and marketing		5,464			4,510
General and administrative		5,642			5,530
Research and development		943			583
Total costs and expenses		32,858			26,753
Income from operations		4,706			2,802
Other income (expense):
Interest and other income		165			87
Interest and other expense		(208		)	(368		)
Income before income taxes		4,663			2,521
Income tax expense		1,679			928
Income from continuing operations		2,984			1,593
Discontinued operations:
Income (loss) from discontinued operations before income taxes		(133		)	530
Income tax benefit (expense)		51			(202		)
Income (loss) from discontinued operations		(82		)	328
Net income		$	2,902		$	1,921
Net income per share:
Basic:
Continuing operations		$	0.17		$	0.10
Discontinued operations		$	0.00		$	0.02
Total		$	0.17		$	0.12
Diluted:
Continuing operations		$	0.16		$	0.09
Discontinued operations		$	0.00		$	0.02
Total		$	0.16		$	0.11
Shares used in computing net income per share:
Basic		17,529,483			16,631,019
Diluted		18,146,740			17,957,929

 

The accompanying notes to the consolidated financial statements are an integral part of these consolidated statements.

 

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