ERF Wireless (ERFB), a leading provider of enterprise-class wireless and broadband products and services, announced that the company has filed its Form 10-Q with the Securities and Exchange Commission reporting results for the quarter ended June 30, 2012.
The company's financial results reflect its continued focus on growth by aggressively expanding its turnkey communications services to the oil and gas industry during a period of brisk oil and gas drilling activity in North America. These results include, but are not limited, to the following attributes:
• The company reported overall Consolidated Revenues of $1,687,000 for the quarter ended June 30, 2012, as compared to $1,311,000 for the same prior year quarter ended June 30, 2011; an increase of $376,000 or 29%. The overall increase was comprised of a $380,000 increase in revenues in our oil and gas operations subsidiary, Energy Broadband Inc., plus a combined increase of $24,000 from our wireless bundled services and wireless messaging services business units and a $28,000 decline in our enterprise network services.
• The company's Energy Broadband Inc., subsidiary reported Revenues of $1,022,000 for the quarter ended June 30, 2012, as compared to revenues of $642,000 for the same prior year quarter ended June 30, 2011; an increase of $380,000 or 59%.
• The company reported Gross Profit of $746,000 for the quarter ended June 30, 2012, as compared to $501,000 for the same prior year quarter ended June 30, 2011; an increase of $245,000 or 49%. This 49% increase in Gross Profits on our 29% increase in Revenues drove our overall Gross Margins to 44% for the quarter ended June 30, 2012, as compared to 38% for the same prior year quarter ended June 30, 2011. This 6% increase in our overall gross margins demonstrates continued solid performance against our number one business objective of growing high margin revenue while maintaining and strengthening our position as the largest terrestrial wireless provider to the oil and gas industry in North America.
• The company reported a Consolidated Net Loss of $1,352,000 for the quarter ended June 30, 2012 as compared to a Consolidated Net Loss of $1,150,000 for the same prior quarter ended June 30, 2011.
• Primary and fully-diluted net loss per share for the quarter ended June 30, 2012, was ($0.46). Primary and fully-diluted net loss per share for the quarter ended June 30, 2011, was ($1.06).
Richard Royall, CFO of ERF Wireless, commented, "During the second quarter of 2012, we continued to experience substantial growth of both revenues and gross profits in our Energy Broadband subsidiary's business in the oil and gas sector. Energy Broadband now represents 61% of the total ERF Wireless revenue and continues to have a very positive impact on the company's overall results. Based on oil and gas industry activity in the second quarter, we anticipate we will continue to see very positive results in 2012 as Energy Broadband delivers more reliable, cost-effective high-speed bandwidth to the industry."
Dr. H. Dean Cubley, CEO of ERF Wireless, commented, "During the second quarter of 2012, we have experienced a significant expansion of the drilling activity of our major oil and gas customers resulting in a very favorable expansion of revenue in Energy Broadband. I believe that this trend will continue for the future as oil prices remain strong and oil drilling activity continues to accelerate. Low natural gas prices have also resulted in a consolidation of drilling rigs in the more oil-rich areas making it much easier for Energy Broadband to consolidate its resources and service its customers in a more concentrated fashion. With recent new major drilling customer wins and a corresponding substantial rig number increase with our existing customers, we anticipate that our financial results will continue to positively increase with the accelerating revenue to meet our objectives of cash flow positive and profitability during 2012."
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