Le Lézard
Classified in: Business
Subjects: EARNINGS, Conference Call, Webcast

Starry Announces Second Quarter 2022 Results


Starry Group Holdings, Inc. (NYSE: STRY) (the "Company" or "Starry"), a licensed fixed wireless technology developer and internet service provider, today reported full results for the second quarter of 2022. The results showed that Starry has continued to successfully execute on its business plan, delivering a strong increase in customer relationships and driving an increase in penetration of homes serviceable, all while improving the operating leverage in the business.

Additionally, Starry continued to expand the reach of its digital equity program, Starry Connect, growing the program to reach more than 77,400 units of public and affordable housing as of June 30, 2022, an increase of more than 14,300 in the quarter, all of which are automatically eligible for participation in the federal government's Affordable Connectivity Program.

Second Quarter of 2022 Highlights

"Our team is laser-focused on execution and sustained growth and it shows in our numbers. For the second quarter in a row, our team has hit our customer growth and network expansion targets, even amidst challenging macroeconomic headwinds in what is acknowledged historically as a seasonally soft quarter for the industry," said Chet Kanojia, Starry co-founder and CEO. "Our disciplined approach to driving efficiencies in our business through technology innovation has created a strong foundation to continue to accelerate and grow the business. With continued strong consumer demand and a pre-paid subscription model, Starry is strongly positioned to continue on its growth trajectory. Positive progress on capital raising continues and remains a top priority as we continue to successfully propel the company forward."

Operational Highlights

"Our team's ability to consistently execute against our business goals gives us the confidence that we can continue to scale and accelerate our growth cadence on customer relationships, network deployment, customer satisfaction and continue to meaningfully expand digital access in underserved communities through Starry Connect and the Affordable Connectivity Program," said Alex Moulle-Berteaux, Starry co-founder and Chief Operating Officer. "While we are laser-focused on goals and growing the business, our teams are also focused on delivering a service experience that delights, and it continues to show in our industry leading Net Promoter Scores. With Las Vegas on the horizon and a continued focus on efficient execution, I'm excited to see what this team can continue to achieve when it brings #HappyInterneting to the great state of Nevada."

Financial Highlights

"Our strategic investments in technology development and our network operations, coupled with strong execution towards our business goals, puts the company on strong footing to realize steady increases in revenue, net income and EBITDA over time," said Komal Misra, Starry Chief Financial Officer. "Home broadband access is essential and Starry's value is resonating with customers as we see with increased penetration across our existing footprint. In these challenging macroeconomic conditions, execution matters and I'm proud that our team has hit our business goals for a second quarter in a row as a public company."

Business Outlook
Starry continues to expect customer relationships to be greater than 100,000 at the end of full-year 2022, reflecting growth of at least 58% year-over-year. In addition, the Federal Communications Commission is in the final stages of its review of Starry's Rural Digital Opportunity Fund ("RDOF") long form application and we are confident it will be granted in the near term. We included approximately seven months of RDOF regulatory revenue in our 2022 guidance provided on the first quarter earnings call and will provide an update once the FCC finalizes its process.

A short presentation discussing an analysis of Starry's building cohorts has also been added to the Investor Relations website.

Conference Call
Starry will host a conference call to discuss its financial results for the second quarter of 2022 on Tuesday, August 9, 2022 at 8:30 a.m. Eastern Time (ET).

Those parties interested in participating via telephone should dial one of the numbers below and enter the conference ID number 562273.

United States Toll Free: 1-844-200-6205
United States Local: 1-646-904-5544
Other Locations: 1-929-526-1599

A live webcast of the conference call will be available on Starry's Investor Relations website at https://investors.starry.com. A replay of the call will be available after 12:00 p.m. ET on the Investor Relations website. To automatically receive Starry financial news and updates, please subscribe to email alerts on the Investor Relations page.

About Starry Group Holdings, Inc.
At Starry (NYSE: STRY), we believe the future is built on connectivity and that connecting people and communities to high-speed, broadband internet should be simple and affordable. Using our innovative, wideband hybrid-fiber fixed wireless technology, Starry is deploying gigabit capable broadband to the home without bundles, data caps, or long-term contracts. Starry is a different kind of internet service provider. We're building a platform for the future by putting our customers first, protecting their privacy, ensuring access to an open and neutral net, and making affordable connectivity and digital equity a priority. Headquartered in Boston, Starry is currently available in Boston, New York City, Los Angeles, Washington, DC, Denver and Columbus, OH. To learn more about Starry or to join our team and help us build a better internet, visit: https://starry.com.

Forward-Looking Statements
This press release includes statements that may constitute "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, express or implied forward-looking statements relating to our expectations regarding our strategy, competitive position and opportunities in the marketplace, and our anticipated business and financial performance. These statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Factors that could cause actual results to differ materially from those expressed or implied include the risks and uncertainties described in the "Risk Factors" section of our Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required under applicable securities laws.

_______________________
1 Adjusted EBITDA and Adjusted EBITDA margin are not measures of financial performance prepared in accordance with GAAP. See "Non-GAAP Financial Measures and Other Business Metrics" at the end of this release for more information and reconciliations to the most directly comparable GAAP financial measures.

STARRY GROUP HOLDINGS, INC.

 

Condensed Consolidated Statements of Operations

(Unaudited)

(in thousands, except for share data)

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues

 

$

7,754

 

 

$

5,091

 

 

$

15,124

 

 

$

9,614

 

Cost of revenues

 

 

(20,725

)

 

 

(13,318

)

 

 

(38,916

)

 

 

(25,822

)

Gross loss

 

 

(12,971

)

 

 

(8,227

)

 

 

(23,792

)

 

 

(16,208

)

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

(25,128

)

 

 

(16,028

)

 

 

(50,218

)

 

 

(30,238

)

Research and development

 

 

(7,810

)

 

 

(6,476

)

 

 

(16,037

)

 

 

(12,418

)

Total operating expenses

 

 

(32,938

)

 

 

(22,504

)

 

 

(66,255

)

 

 

(42,656

)

Loss from operations

 

 

(45,909

)

 

 

(30,731

)

 

 

(90,047

)

 

 

(58,864

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(8,038

)

 

 

(4,926

)

 

 

(15,568

)

 

 

(12,581

)

Other income (expense), net

 

 

17,640

 

 

 

(2,897

)

 

 

15,675

 

 

 

(8,155

)

Total other income (expense)

 

 

9,602

 

 

 

(7,823

)

 

 

107

 

 

 

(20,736

)

Net loss

 

$

(36,307

)

 

$

(38,554

)

 

$

(89,940

)

 

$

(79,600

)

Net loss per share of common stock, basic and diluted

 

$

(0.22

)

 

$

(1.06

)

 

$

(0.88

)

 

$

(2.19

)

Weighted-average shares outstanding, basic and diluted

 

 

162,423,594

 

 

 

36,410,177

 

 

 

102,357,494

 

 

 

36,325,426

STARRY GROUP HOLDINGS, INC.

 

Condensed Consolidated Balance Sheets

(Unaudited)

(in thousands, except for share data)

 

 

 

June 30,
2022

 

 

December 31,
2021

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

99,682

 

 

$

29,384

 

Accounts receivable, net

 

 

439

 

 

 

380

 

Deferred costs

 

 

?

 

 

 

7,049

 

Prepaid expenses and other current assets

 

 

10,576

 

 

 

7,079

 

Total current assets

 

 

110,697

 

 

 

43,892

 

Property and equipment, net

 

 

149,485

 

 

 

129,019

 

Intangible assets

 

 

48,463

 

 

 

48,463

 

Restricted cash and other assets

 

 

2,510

 

 

 

1,860

 

Total assets

 

$

311,155

 

 

$

223,234

 

Liabilities, redeemable shares and stockholders' equity (deficit)

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

6,679

 

 

$

6,832

 

Unearned revenue

 

 

2,577

 

 

 

1,630

 

Current portion of debt

 

 

1,861

 

 

 

1,504

 

Accrued expenses and other current liabilities

 

 

23,881

 

 

 

23,177

 

Total current liabilities

 

 

34,998

 

 

 

33,143

 

Debt, net of current portion

 

 

219,669

 

 

 

191,596

 

Earnout liabilities

 

 

9,321

 

 

 

?

 

Warrant liabilities

 

 

8,468

 

 

 

14,773

 

Asset retirement obligations

 

 

2,903

 

 

 

2,387

 

Other liabilities

 

 

19,084

 

 

 

12,412

 

Total liabilities

 

 

294,443

 

 

 

254,311

 

Redeemable shares

 

 

10,579

 

 

 

?

 

Stockholders' equity (deficit):

 

 

 

 

 

 

Convertible preferred stock

 

 

?

 

 

 

453,184

 

Legacy common stock

 

 

?

 

 

 

4

 

Class A common stock

 

 

16

 

 

 

?

 

Class X common stock

 

 

1

 

 

 

?

 

Additional paid-in capital

 

 

597,427

 

 

 

17,106

 

Accumulated deficit

 

 

(591,311

)

 

 

(501,371

)

Total stockholders' equity (deficit)

 

 

6,133

 

 

 

(31,077

)

Total liabilities, redeemable shares and stockholders' equity (deficit)

 

$

311,155

 

 

$

223,234

STARRY GROUP HOLDINGS, INC.

 

Condensed Consolidated Statements of Cash Flow

(Unaudited)

(in thousands, except for share data)

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(36,307

)

 

$

(38,554

)

 

$

(89,940

)

 

$

(79,600

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization expense

 

 

10,313

 

 

 

6,878

 

 

 

19,645

 

 

 

12,973

 

Paid-in-kind interest on term loans, convertible notes payable and strategic partner obligations

 

 

6,191

 

 

 

4,139

 

 

 

12,070

 

 

 

8,369

 

Amortization of debt discount and deferred charges

 

 

1,776

 

 

 

733

 

 

 

3,402

 

 

 

3,150

 

Conversion of debt discount

 

 

?

 

 

 

?

 

 

 

?

 

 

 

971

 

Loss on extinguishment of debt

 

 

?

 

 

 

?

 

 

 

?

 

 

 

2,361

 

Fair value adjustment of derivative liabilities

 

 

(17,636

)

 

 

2,898

 

 

 

(19,559

)

 

 

5,796

 

Recognition of distribution to non-redeeming shareholders

 

 

?

 

 

 

?

 

 

 

3,888

 

 

 

?

 

Loss on disposal of property and equipment

 

 

712

 

 

 

745

 

 

 

1,434

 

 

 

1,223

 

Share-based compensation

 

 

992

 

 

 

358

 

 

 

4,699

 

 

 

578

 

Transaction costs allocated to warrants and earnout liability instruments

 

 

?

 

 

 

?

 

 

 

314

 

 

 

?

 

Accretion of asset retirement obligations

 

 

75

 

 

 

48

 

 

 

144

 

 

 

89

 

Provision for doubtful accounts

 

 

11

 

 

 

(21

)

 

 

24

 

 

 

2

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(55

)

 

 

(28

)

 

 

(84

)

 

 

(106

)

Prepaid expenses and other current assets

 

 

(4,236

)

 

 

(1,666

)

 

 

(3,494

)

 

 

(2,141

)

Deferred cost

 

 

168

 

 

 

(398

)

 

 

?

 

 

 

(453

)

Other assets

 

 

(369

)

 

 

(5

)

 

 

(649

)

 

 

(14

)

Accounts payable

 

 

(637

)

 

 

(3,499

)

 

 

(246

)

 

 

(770

)

Unearned revenue

 

 

944

 

 

 

80

 

 

 

947

 

 

 

541

 

Accrued expenses and other current liabilities

 

 

(5,068

)

 

 

1

 

 

 

1,885

 

 

 

1,473

 

Other liabilities

 

 

?

 

 

 

2,000

 

 

 

4

 

 

 

2,000

 

Net cash used in operating activities

 

 

(43,126

)

 

 

(26,291

)

 

 

(65,516

)

 

 

(43,558

)

Investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(20,834

)

 

 

(19,969

)

 

 

(37,584

)

 

 

(29,985

)

Net cash used in investing activities

 

 

(20,834

)

 

 

(19,969

)

 

 

(37,584

)

 

 

(29,985

)

Financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from Business Combination, net of transaction costs

 

 

(3,236

)

 

 

?

 

 

 

160,539

 

 

 

?

 

Repayment of note assumed in the Business Combination

 

 

?

 

 

 

?

 

 

 

(1,200

)

 

 

?

 

Proceeds from the issuance of convertible notes payable and beneficial conversion feature on convertible notes

 

 

?

 

 

 

?

 

 

 

?

 

 

 

11,000

 

Proceeds from Strategic Partner Arrangement

 

 

208

 

 

 

563

 

 

 

3,932

 

 

 

1,994

 

Proceeds from exercise of common stock options

 

 

289

 

 

 

116

 

 

 

756

 

 

 

218

 

Proceeds from the issuance of Series E Preferred Stock, net of issuance costs

 

 

?

 

 

 

?

 

 

 

?

 

 

 

119,850

 

Proceeds from the issuance of term loans, net of issuance costs

 

 

?

 

 

 

?

 

 

 

10,000

 

 

 

?

 

Payments of third-party issuance costs in connection with Term Loans

 

 

?

 

 

 

?

 

 

 

(47

)

 

 

?

 

Repayments of capital lease obligations

 

 

(312

)

 

 

(180

)

 

 

(582

)

 

 

(373

)

Net cash provided by financing activities

 

 

(3,051

)

 

 

499

 

 

 

173,398

 

 

 

132,689

 

Net increase (decrease) in cash and cash equivalents and restricted cash:

 

 

(67,011

)

 

 

(45,761

)

 

 

70,298

 

 

 

59,146

 

Cash and cash equivalents and restricted cash, beginning of period

 

 

168,071

 

 

 

131,738

 

 

 

30,762

 

 

 

26,831

 

Cash and cash equivalents and restricted cash, end of period

 

$

101,060

 

 

$

85,977

 

 

$

101,060

 

 

$

85,977

Non-GAAP Financial Measures and Other Business Metrics

To supplement our consolidated financial statements, which are prepared and presented in accordance with Generally Accepted Accounting Principles in the United States (GAAP), we provide investors with certain non-GAAP financial measures and other business metrics, which we believe are helpful to our investors. We use these non-GAAP financial measures and other business metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We believe that these non-GAAP financial measures and other business metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.

The presentation of non-GAAP financial information and other business metrics is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. While our non-GAAP financial measures and other business metrics are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, we urge investors to review the reconciliation of these financial measures to the comparable GAAP financial measures included below, and not to rely on any single financial measure to evaluate our business.

 

 

As of June 30,

 

 

 

2022

 

 

2021

 

Addressable Households

 

 

9,691,029

 

 

 

9,691,029

 

Homes Serviceable

 

 

5,650,103

 

 

 

4,724,080

 

Customer Relationships

 

 

80,950

 

 

 

47,786

 

Penetration of Homes Serviceable

 

 

1.43

%

 

 

1.01

%

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue (000s)

 

$

7,754

 

 

$

5,091

 

 

$

15,124

 

 

$

9,614

 

Average Revenue Per User ("ARPU")

 

$

33.96

 

 

$

38.00

 

 

$

34.96

 

 

$

38.95

 

Net Loss (000s)

 

$

(36,307

)

 

$

(38,554

)

 

$

(89,940

)

 

$

(79,600

)

Net Loss margin

 

 

(468

)%

 

 

(757

)%

 

 

(595

)%

 

 

(828

)%

Adjusted EBITDA (000s)

 

$

(33,850

)

 

$

(23,493

)

 

$

(61,662

)

 

$

(45,311

)

Adjusted EBITDA margin

 

 

(437

)%

 

 

(461

)%

 

 

(408

)%

 

 

(471

)%

Reconciliations of Adjusted EBITDA and Adjusted EBITDA margin

We define Adjusted EBITDA as Net Loss, adjusted to exclude interest, tax, depreciation and amortization expense, unusual or non-recurring items, non-cash items and other items that are not indicative of ongoing operations (including one-time transaction related expenses, stock-based compensation expenses, loss on extinguishment of debt, the fair value adjustment of derivative liabilities and recognition of distribution to non-redeeming shareholders). We define Adjusted EBITDA margin as Adjusted EBITDA divided by revenue. Adjusted EBITDA and Adjusted EBITDA margin are frequently used by management, research analysts, investors and other interested parties to evaluate companies. Adjusted EBITDA and Adjusted EBITDA margin are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, Net Loss or Net Loss margin, the most directly comparable GAAP financial measures, and may be different from similarly titled non-GAAP financial measures used by other companies.

 

 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

($ in thousands)

 

2022

 

2021

 

2022

 

2021

Net Loss ($) and Net Loss margin (%)

 

$

(36,307

)

 

(468

%)

 

$

(38,554

)

 

(757

%)

 

$

(89,940

)

 

(595

%)

 

$

(79,600

)

 

(828

%)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add: Interest expense, net

 

 

8,033

 

 

104

%

 

 

4,927

 

 

97

%

 

 

15,563

 

 

103

%

 

 

12,581

 

 

131

%

Add: Depreciation and amortization expense

 

 

10,313

 

 

133

%

 

 

6,878

 

 

135

%

 

 

19,645

 

 

130

%

 

 

12,973

 

 

135

%

Add: Non-recurring transaction related expenses (1)

 

 

755

 

 

10

%

 

 

?

 

 

?

 

 

 

4,042

 

 

27

%

 

 

?

 

 

?

 

(Subtract)/Add: (Gain)/loss on fair value adjustment of derivative liabilities

 

 

(17,636

)

 

(227

)%

 

 

2,898

 

 

57

%

 

 

(19,559

)

 

(129

)%

 

 

5,796

 

 

60

%

Add: Recognition of distribution to non-redeeming shareholders

 

 

?

 

 

?

 

 

 

?

 

 

?

 

 

 

3,888

 

 

26

%

 

 

?

 

 

?

 

Add: Loss on extinguishment of debt

 

 

?

 

 

?

 

 

 

?

 

 

?

 

 

 

?

 

 

?

 

 

 

2,361

 

 

25

%

Add: Stock-based compensation

 

 

992

 

 

13

%

 

 

358

 

 

7

%

 

 

4,699

 

 

31

%

 

 

578

 

 

6

%

Adjusted EBITDA ($) and Adjusted EBITDA margin (%)

 

$

(33,850

)

 

(437

%)

 

$

(23,493

)

 

(461

%)

 

$

(61,662

)

 

(408

%)

 

$

(45,311

)

 

(471

%)

(1) We add back expenses that are related to transactions that occurred during the period that are expected to be non-recurring, including mergers and acquisitions and financings. Generally these expenses are included within selling, general and administrative expense in the statement of operations. For the six months ended June 30, 2022, such transactions comprised of the Business Combination, the sale of the PIPE shares, the sale of the Series Z Preferred Stock shares, the registration for resale of both Class A common stock and private placement warrants as well as other financing costs.

 


These press releases may also interest you

at 16:54
Royal Bank of Canada today announced a donation of $250,000 to the Red Cross Hurricane Fiona in Canada Appeal to support people across eastern Canada who have been impacted by this devastating hurricane....

at 15:48
Desjardins Group will quickly set up support measures for members and clients affected by Hurricane Fiona. It has also teamed up with the Canadian Red Cross, making a $75,000 donation to the Hurricane Fiona in Canada Appeal relief fund. "It's...

at 14:42
Scotiabank is donating $250,000 to the Canadian Red Cross to get urgent relief to those in Eastern Canada affected by Hurricane Fiona. Funding will also support long-term recovery and resiliency efforts in the communities most impacted....

24 sep 2022
Three social change organizations are partnering on a new and unique approach to philanthropy by funding and advancing digital equity advocacy in California...

24 sep 2022
Juan Monteverde, founder and managing partner of the class action firm Monteverde & Associates PC (the "M&A Class Action Firm"), a national securities firm rated Top 50 in the 2018-2021 ISS Securities Class Action Services Report and headquartered at...

24 sep 2022
WHY: Rosen Law Firm, a global investor rights law firm, reminds purchasers of the stock of Stitch Fix, Inc. between December 8, 2020 and March 8, 2022, both dates inclusive (the "Class Period"), of the important October 25, 2022 lead plaintiff...



News published on 9 august 2022 at 07:40 and distributed by: