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MDU Communications Accelerates HDTV Property Upgrade Program; Reports Record Revenue, Earnings Per Share and Gain on Sale of Subscribers for Its First Fiscal Quarter '09 - First quarter revenue up 26% over same period in prior year to $6.6 million -

TOTOWA, NEW JERSEY, Feb 11, 2009 (Marketwire via COMTEX) -- MDU Communications International, Inc. (OTCBB: MDTV), despite the economic downturn, reports strong financial results for its first fiscal quarter ending December 31, 2008. Revenue for the quarter was $6,616,635, a 26% increase over the same period in the prior fiscal year and average revenue per unit ("ARPU") across all billable subscriber types was $34.19, a 16% increase over the ARPU of $29.55 realized during fiscal '08.

Additionally, during the quarter ended December 31, 2008, the Company realized net income of $4,205,009 and positive EBITDA (as adjusted) of $6,418,080, as compared to positive EBITDA of $119,117 for the same period in the prior fiscal year. The strong financial growth in net income and EBITDA (as adjusted) was due primarily to the gain realized on the sale of certain assets during the quarter. Net of this gain, the Company realized positive EBITDA (as adjusted) of $1,379,241 in the first fiscal quarter.

The Company's continued focus on improving its financial results directly resulted in increased revenues and EBITDA, but also resulted in lower (as a percentage of revenue) operating expenses - specifically direct costs, customer service, sales and marketing, and general and administrative expenses, when compared to the same period in the prior fiscal year. Collectively, these operating expenses declined by 22% as a percentage of revenue during the quarter as compared to the same period in the prior fiscal year. Additionally, depreciation expense also declined by 5% as a percent of revenue during the first quarter as compared to the same period a year earlier.

  
Three Months Three Months Ended Ended Change Change December 31, 2008 December 31, 2007 ($) (%) ------------------------------------------------------- REVENUE $ 6,616,635 100% $ 5,268,439 100% $ 1,348,196 26% Direct costs 2,596,698 39% 2,429,204 46% 167,494 7% Sales expenses 278,060 4% 338,340 6% (60,280) -18% Customer service and operating expenses 1,556,873 24% 1,443,623 27% 113,250 8% General and administrative expenses 862,436 13% 1,196,447 23% (334,011) -28% Depreciation and amortization 1,626,635 25% 1,555,145 30% 71,490 5% (Gain) on sale of assets (5,038,839) -76% - - (5,038,839) - ----------- --- ----------- --- ----------- OPERATING INCOME (LOSS) 4,734,772 71% (1,694,320) -32% 6,429,092 379% Total other income (loss) (529,763) -8% (485,988) -9% 43,775 9% ----------- --- ----------- --- ----------- NET INCOME (LOSS) $ 4,205,009 63% $(2,180,308) -41% $ 6,385,317 293% ----------- --- ----------- --- ----------- ----------- --- ----------- --- -----------





For the past year, the Company has been implementing a comprehensive plan to upgrade its properties and current DIRECTV high definition ("HD") subscribers to the newly launched DIRECTV MFH-2 platform and expanded line-up of DIRECTV HD services. During the first fiscal quarter, the Company upgraded 21,303 units in 110 properties to the new DIRECTV HD platform and had 6,733 units in 25 properties that were work-in-progress at December 31, 2008. Since the Company began its upgrade program in fiscal '08, it has upgraded (or has upgrades in process at December 31, 2008) of 224 properties containing 45,762 units. The Company is currently implementing the final phase of its property upgrade program targeting an additional 25,500 units in approximately 180 properties to be completed during the second and third fiscal quarters of '09. DIRECTV is providing certain financial assistance with this upgrade program through July 2009.


These property upgrades to the new DIRECTV HD platform are essential as subscribers and property owners demand state-of-the-art technology and want access to DIRECTV's unparalleled comprehensive offering of HD programming and services. DIRECTV currently offers over 130 (moving to 150) HD national programming channels and has HD local programming in more than 94% of all U.S. markets. The continued launch and advertising campaign for this new DIRECTV HD programming and associated services will continue to provide incremental revenue and improved penetration rates within Company properties. Additionally, these upgrades are resulting in property access agreement extensions and renewals, increased penetration rates within these properties, increased sale of advanced services and an increase in the Company's DIRECTV subscriber residual, all of which positively impact the Company's financial results.


As previously announced, the Company entered into an agreement with CSC Holdings, Inc. on September 30, 2008 for the sale of certain assets. This multi-closing transaction has produced three separate closings to date, two of which closed during the quarter ended December 31, 2008. On November 5, 2008, 1,803 subscribers were transferred for proceeds of $2,705,500 (resulting in a gain to the Company of $2,382,502) and on December 17, 2008, 2,064 subscribers were transferred for proceeds of $3,096,000 (resulting in a gain to the Company of $2,656,337). In total, the Company has received over $8,330,000 in proceeds from this transaction, clearly establishing an important valuation for its subscribers. As of December 31, 2008, the Company has applied over $6 million of these proceeds to reduce its Credit Facility and expects another $2.3 million to be applied prior to the end of the second fiscal quarter. As of December 31, 2008, the Company had utilized $11,216,828 (net of proceeds held in escrow from the asset sale closings) of its Credit Facility, as compared to $16,641,586 on September 30, 2008.


The Company planned for, and expected, slower subscriber growth during the quarter due to (i) its significant commitment to upgrade its current properties to the new DIRECTV HD Platform, (ii) its focus to convert its current properties from low margin private cable services to higher ARPU DIRECTV services, (iii) a fiscal decision, dictated in part by these economic times, to conserve capital and improve financial returns from previous capital investment in its portfolio of properties, and (iv) the sale of a certain number of subscribers to CSC Holdings. During the quarter ended December 31, 2008, the Company experienced a net subscriber reduction of 6,310 subscribers, primarily the result of the sale of subscribers to CSC Holdings, the disconnection of Internet subscribers in properties sold to CSC Holdings and other planned disconnections and non-renewals. As of December 31, 2008, the Company reports 59,242 total billable subscribers. The Company expects to increase its rate of subscriber growth later in fiscal '09 as its HD platform upgrade program approaches completion. The Company's breakdown of total subscribers by type and kind is outlined in the following chart:





Subscribers Subscribers Subscribers Subscribers Subscribers as of as of as of as of as of Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, Service Type 2007 2008 2008 2008 2008 -------------- ----------- ----------- ----------- ----------- ----------- Bulk DTH -DIRECTV 14,808 15,016 15,249 15,382 12,478 DTH -DIRECTV Choice/ Exclusive 10,650 11,269 11,547 10,790 11,037 Bulk Private Cable 20,564 20,084 20,179 17,194 14,586 Private Cable Choice or Exclusive 3,211 3,369 2,270 1,952 2,446 Bulk BCA -DIRECTV 7,921 8,527 8,687 10,337 9,505 Bulk ISP 5,863 6,173 6,394 5,911 5,215 ISP Choice or Exclusive 3,875 4,041 3,784 3,956 3,952 Voice 73 39 32 30 23 ----------- ----------- ----------- ----------- ----------- Total Subscribers 66,965 68,518 68,142 65,552 59,242 ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- ----------- -----------





As of December 31, 2008, the Company also had 6,777 units in work-in-progress for which the Company expects a minimum of 1,382 of these units (under contract subscribers) to become billable subscribers in the next few quarters. Regarding its Voice over Internet ("VoIP") service, the Company previously announced it had deployed this service to certain of its properties in a 'soft' launch. Based on the successful operating results of the service, the Company has expanded the launch of the service to numerous additional properties where the Company offers bulk video and broadband services. To facilitate the bundling of its video, broadband and VoIP services, the Company is developing plans to 'bundle' its services onto a single billing platform.


Mr. Sheldon Nelson, President of MDU Communications, commented, "We are very well positioned to succeed in fiscal '09 and expect our results to continue to improve as we solidify our position as a leader in this market segment. We are well-capitalized, committed to fiscally responsible growth, and despite a poor economy, we expect our results to improve as more and more people turn to their television and the Internet as economical sources of information and entertainment."


The Company expects to file its quarterly report on Form 10-Q for the quarter ended December 31, 2008 with the Securities and Exchange Commission on or before February 12, 2009. The Company will be hosting a conference call on February 11, 2009 at 10:00 am EST. Call information is available on the Company's web site at www.mduc.com.


About MDU: MDU Communications International, Inc. (OTCBB: MDTV) is a leading provider of premium communication/information services, including digital satellite television and high-speed (broadband) Internet services, exclusively to the United States multi-dwelling unit (MDU) marketplace - estimated to include 26 million residences. Through its wholly owned subsidiary, MDU Communications (USA) Inc., MDU Communications delivers DIRECTV(R) digital satellite television services and high-speed (broadband) Internet systems and is committed to delivering the next generation of interactive communication services to MDU residents. For additional information, please see www.mduc.com or contact Investor Relations.


"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements relating to financial information, property upgrades, strategic partner relationships, subscriber sales, subscriber and revenue growth and implementation of new programs and developments of the Company. Such statements involve risks and uncertainties which may cause results to differ materially from those set forth in these statements, including, but not limited to, changes in financial condition, efforts on behalf of the Company to finalize and deploy certain programs, bringing to fruition strategic alliances and upgrade programs, fluctuations in operating results and operating plans, deployment of new subscribers and conversion of existing subscribers, market forces, supplier negotiations, the closing of asset sales and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including, but not limited to, the Company's 10-K for the year ended September 30, 2008, filed on or about December 23, 2008.


SOURCE: MDU Communications International, Inc.


CONTACT: MDU Communications International, Inc. Sheldon Nelson CEO (973) 237-9499 Email: investor@mduc.com Website: www.mduc.com


Copyright (C) 2009 Marketwire. All rights reserved.

-------- -------- -------- -------- --------
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As mentioned, the Company has developed and is implementing a comprehensive plan to upgrade its properties and current DIRECTV HD subscribers to the newly launched and expanding line-up of DIRECTV HD services. HD customers across the United States have doubled over the past year and this growth is expected to continue. During the third fiscal quarter, the Company upgraded 7,317 units in 39 properties to the new DIRECTV HD platform and had 6,201 units in 27 properties that were work-in-progress at June 30, 2008 that it expects will be completed in the fourth fiscal quarter. The Company anticipates it will have upgraded approximately 20,000 units in 110 properties by September 30, 2008. Property upgrades to the new DIRECTV HD platform are resulting in access agreement extensions and renewals, increased penetration rates within these properties, increased sale of advanced services and an increase in the Company's DIRECTV subscriber residual, all of which will positively impact the future of the Company as was evidenced in the second and third fiscal quarters.
The Company continues to develop its plan to launch a Voice over Internet ("VoIP") service to certain of its properties later this fiscal year. The Company will initially focus on deploying VoIP services to its portfolio of DIRECTV DTH Bulk and BCA properties serving 23,936 subscribers. To facilitate the bundling of its video, broadband and VoIP services, the Company is developing plans to "bundle" its services onto a single billing platform. The Company is in discussions with DIRECTV for such billing integration.

Mr. Sheldon Nelson, President of MDU Communications, commented, "We had an excellent quarter and fiscal 2008 should be a very good and important year for the Company. Going forward, we'll be in a better position to realize the subscriber growth we envision and produce solid financial results while doing so."

The Company expects to file its quarterly report on Form 10-Q for the period ended June 30, 2008 with the Securities and Exchange Commission on or before August 14, 2008. The Company will be hosting a third quarter earnings conference call on August 13, 2008 at 10:00 am EST. Call information is available on the Company's website at www.mduc.com.

The following table reconciles the comparative EBITDA (as adjusted) of the Company to its consolidated net income (loss) as computed under accounting principles generally accepted in the United States of America:

For The Nine Months For The Three Months
Ended June 30, Ended June 30, -------------------------- ---------------------------
2008 2007 2008 2007
------------ ------------ ------------ -------------
EBITDA $ 1,722,851 $ 343,364 $ 1,099,831 $ 55,503
Interest Expense (1,331,673) (530,652) (475,788) (201,624)
Deferred finance
costs and debt
discount
amortization
(interest expense) (251,154) (130,127) (86,496) (49,245)
Provision for
doubtful accounts (107,056) (176,094) (34,419) -
Depreciation and
Amortization (4,851,530) (3,775,221) (1,673,136) (1,272,056)
Share-based
Compensation
expense -
employees (264,522) (631,581) (53,696) (194,741)
Compensation
expense for
issuance of
common stock
through
employee stock
purchase plan (17,085) (18,526) (2,649) (1,496)
Compensation
expense for
issuance of
common stock
for employee
bonuses (37,141) (37,240) - (2,308)
Compensation
expense for
issuance of
common stock
for employee
wages (4,560) (33,945) (4,560) -
Compensation
expense accrued
to be settled
through the
issuance of
common stock (6,296) - (6,296) -
Compensation
expense through
the issuance of
restricted
common stock
for services
rendered (60,522) (60,000) (20,572) (60,000)
Share-based
compensation
expense -
nonemployees (5,400) (63,125) (5,400) -
------------ ------------ ------------ -------------
Net Loss $ (5,214,088) $ (5,113,147) $ (1,263,181) $ (1,725,967)
------------ ------------ ------------ -------------
------------ ------------ ------------ -------------
MDU COMMUNICATIONS INTERNATIONAL, INC.
Condensed Consolidated Balance Sheets
June 30, 2008 (Unaudited) and September 30, 2007 (Audited)
June 30, September 30,
2008 2007
------------ ------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 165,617 $ 767,296
Accounts receivable- trade, net of an
allowance of $299,004 and $167,674 2,041,794 2,381,234
Prepaid expenses and deposits 583,296 582,319
------------ ------------
TOTAL CURRENT ASSETS 2,790,707 3,730,849
Telecommunications equipment inventory 837,962 970,456
Property and equipment, net of
accumulated depreciation of
$16,682,317 and $12,784,932 22,308,478 22,046,390
Intangible assets, net of accumulated
amortization of $5,094,512 and $4,153,493 3,442,682 4,186,809
Deferred finance costs, net of accumulated
amortization of $354,704 and $144,979 519,015 513,740
------------ ------------
TOTAL ASSETS $ 29,898,844 $ 31,448,244
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 1,676,851 $ 1,818,594
Other accrued liabilities 740,249 1,301,307
Current portion of deferred revenue 579,071 704,618
Current portion of note payable 54,153 51,723
Current portion of capital lease
obligations 33,691 81,291
------------ ------------
TOTAL CURRENT LIABILITIES 3,084,015 3,957,533
Deferred revenue, net of current portion 401,837 408,640
Credit line borrowing, net of debt
discount 17,318,527 13,224,561
Note payable, net of current portion 9,365 50,286
Capital lease obligations, net of current
portion - 12,179
------------ ------------
TOTAL LIABILITIES 20,813,744 17,653,199
------------ ------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, par value
$0.001; 5,000,000 shares authorized,
0 issued - -
Common stock, par value $0.001;
70,000,000 shares authorized,
51,976,489 and 51,556,989 shares
issued and outstanding 51,976 51,556
Additional paid-in capital 60,712,224 60,208,501
Accumulated deficit (51,679,100) (46,465,012)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 9,085,100 13,795,045
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 29,898,844 $ 31,448,244
------------ ------------
------------ ------------
See notes to the unaudited condensed consolidated financial statements
contained in the Company's Report on Form 10-Q for the period ended
June 30, 2008.
MDU COMMUNICATIONS INTERNATIONAL, INC.
Condensed Consolidated Statements of Operations
Nine and Three Months Ended June 30, 2008 and 2007
(Unaudited)
Nine Months Ended June 30, Three Months Ended June 30,
--------------------------- --------------------------
2008 2007 2008 2007
------------ ------------ ----------- ------------
REVENUE $ 17,138,127 $ 11,872,813 $ 6,257,780 $ 3,956,978
------------ ------------ ----------- ------------
OPERATING EXPENSES
Direct costs 7,468,119 5,044,104 2,542,022 1,765,646
Sales expenses 955,890 955,966 303,895 292,198
Customer service
and operating
expenses 4,386,747 3,443,035 1,504,127 1,133,237
General and
administrative
expenses 3,108,498 3,147,718 935,645 983,619
Depreciation and
amortization 4,851,530 3,775,221 1,673,136 1,272,056
-------------------------------------------------------
TOTALS 20,770,784 16,366,044 6,958,825 5,446,756
------------ ------------ ----------- ------------
OPERATING LOSS (3,632,657) (4,493,231) (701,045) (1,489,778)
Other income
(expense)
Gain on sale of
customers - 14,245 - 14,245
Interest income 1,396 26,618 148 435
Interest expense (1,582,827) (660,779) (562,284) (250,869)
------------ ------------ ----------- ------------
NET LOSS $ (5,214,088) $ (5,113,147) $(1,263,181) $ (1,725,967)
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
BASIC AND
DILUTED LOSS
PER COMMON SHARE $ (0.10) $ (0.10) $ (0.02) $ (0.03)
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING 51,769,295 51,223,580 51,920,237 51,346,257
------------ ------------ ----------- ------------
------------ ------------ ----------- ------------
See accompanying notes to the unaudited condensed consolidated financial
statements contained in the Company's Report on Form 10-Q for the period
ended June 30, 2008.

About MDU: MDU Communications International, Inc. (OTCBB: MDTV) is a leading provider of premium communication/information services, including digital satellite television and high-speed (broadband) Internet services, exclusively to the United States multi-dwelling unit (MDU) marketplace - estimated to include 26 million residences. Through its wholly owned subsidiary, MDU Communications (USA) Inc., MDU Communications delivers DIRECTV(R) digital satellite television services and high-speed (broadband) Internet systems and is committed to delivering the next generation of interactive communication services to MDU residents. For additional information, please see www.mduc.com or contact Investor Relations.
"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements relating to financial information, property upgrades, strategic partner relationships, subscriber and revenue growth and implementation of new programs and developments of the Company. Such statements involve risks and uncertainties which may cause results to differ materially from those set forth in these statements, including, but not limited to, changes in financial condition, efforts on behalf of the Company to finalize and deploy certain programs, bringing to fruition strategic alliances and upgrade programs, fluctuations in operating results and operating plans, deployment of new subscribers and conversion of existing subscribers, market forces, supplier negotiations and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including, but not limited to, the Company's 10-K for the year ended September 30, 2007, filed on or about December 21, 2007.

Contacts:
MDU Communications International, Inc.
Sheldon Nelson
CEO
(973) 237-9499
Email: investor@mduc.com
Website: www.mduc.com

PostSubject
#91   MDTV revoked: Renee 07/25/16 09:40:48 AM
#90   SEC nailed me on this one. still holding funnyG986 04/21/16 02:48:05 PM
#89   MDTV SEC Suspension for Financials / Filings delinquencies: Renee 04/21/16 01:22:04 PM
#88   major sell yesterday is below $0.012. major buy funnyG986 09/22/15 09:29:04 AM
#87   Lets keep it positive. MDTV sitting on DJPennyTrader 09/22/15 09:22:06 AM
#86   Looks like we got new bagholders now stock1ace1 09/22/15 07:44:50 AM
#84   Looks like old bag holders that wanted out DJPennyTrader 09/21/15 11:09:33 PM
#83   MDTV is on the list of delinquent filers: http://investorshub.advfn.com/boards stock1ace1 09/19/15 08:03:29 AM
#82   This moves so easily, 1 M vol we DJPennyTrader 09/18/15 05:06:10 PM
#81   ok I'll put on watch list for now threewheeler 09/18/15 02:11:32 PM
#80   not really. purely vol and SS play. Any funnyG986 09/18/15 02:09:49 PM
#79   see the move any reason, dont see filings, news? threewheeler 09/18/15 02:04:00 PM
#78   MDTV spike with 1M vol make it hit funnyG986 09/18/15 10:23:10 AM
#77   MDTV super small SS - 35 M AS! DJPennyTrader 09/18/15 10:21:55 AM
#76   MDTV is severely delinquent in filing their Financials Renee 02/22/15 10:57:19 AM
#75   MDTV SC 13G/A just out; Only 6M funnyG986 01/09/15 05:43:15 PM
#74   MDTV nice 40K hit @ 0.02 AOuvier 11/07/14 11:15:30 AM
#73   MDTV another low float play. could hit back funnyG986 07/30/14 11:07:53 AM
#72   If the guys in at a penny wouldn't STOCK_MOMO 07/17/14 04:42:44 PM
#71   who's the mm on .016? why would there janitor_unbound 07/17/14 02:46:53 PM
#70   very odd action! janitor_unbound 07/17/14 02:39:15 PM
#69   Watching close to find bottom TRIPIL7Z 07/17/14 02:26:19 PM
#68   MDTV loading the pull back ? funnyG986 07/17/14 02:09:05 PM
#67   nice action, watching for follow thru. microscopic SS. janitor_unbound 07/17/14 02:08:10 PM
#66   MDTV 0.024 X 0.025 funnyG986 07/17/14 01:41:46 PM
#65   $MDTV .02 alert giddy up TRIPIL7Z 07/17/14 01:41:15 PM
#64   MDTV monster run started. grab your ticket funnyG986 07/17/14 01:40:33 PM
#63   MDTV big move here HallaDurg 07/17/14 01:38:34 PM
#62   Mdtv 0.015x0.018. Tiny float and direct tv relation funnyG986 05/14/14 02:08:09 PM
#61   This has to be one of the lowest GOLDMAN STACKS 05/14/14 11:50:07 AM
#60   MDTV bids slowly climbing up 0.017 x 0.019 funnyG986 05/14/14 11:21:11 AM
#59   haha I think you lit the fuse here. janitor_unbound 05/14/14 10:46:34 AM
#58   MDTV $0.0113 x $0.0195 might benefit from ATT funnyG986 05/13/14 11:53:05 PM
#57   this'll have its day. still holding a bunch janitor_unbound 04/14/14 08:46:10 AM
#56   What is going on this company.. alen121 02/15/14 12:19:19 PM
#55   MDTV 5.7M O/S @ .0013 = $68,000 Cap! janitor_unbound 02/12/14 02:59:13 PM
#54   looks like MDTV sold off its core business, janitor_unbound 02/12/14 02:57:55 PM
#53   MDTV quick DD 8k news today : all about funnyG986 01/10/14 10:51:54 PM
#52   MDTV Insider purchase in 07/2013 at $0.481 and funnyG986 01/10/14 10:40:05 PM
#51   it will be nice if some more MDTV funnyG986 01/10/14 07:49:56 PM
#50   today's 8k: funnyG986 01/10/14 07:48:56 PM
#49   MDTV only 5M OS. $20M in annual rev. funnyG986 01/10/14 07:42:15 PM
#48   Not many iHuber got MDTV noticed here. Over funnyG986 01/10/14 07:40:04 PM
#47   MDTV is up by 124% kranthikumar 09/11/13 09:56:05 AM
#46   MDU Communications International, Inc. Third fiscal quarter 2011 Penny Roger$ 08/09/11 12:26:45 AM
#45   don't know why this company could care less Ecostate 03/25/10 01:55:30 PM
#44   too bad this isn't nasdaq .... eom Ecostate 02/04/10 04:23:50 PM
#43   if only this were a nasdaq stock........rm Ecostate 11/20/09 04:16:16 AM
#42   why does this stock not moving, its PR tk2007 11/19/09 03:03:41 PM
#41   MDU Communications Announces Preliminary Fiscal '09 Year End tk2007 11/19/09 03:01:47 PM
PostSubject