TeraGo revenue up again, but still in red

Wireless business broadband and voice services provider TeraGo Inc. continues to pull in record revenue but stay in the red. Revenue for the three months ended Sept. 30, its third quarter, increased 12 per cent to $9.7 million, the company said Friday, up from $8.6 million for the same period in 2009.

The increase largely resulted from the higher number of customer locations in service as well as upgrades by existing customers to their Internet and data connections. The Thornhill, Ont. company added 167 net new customers during Q3. Average monthly revenue per customer location (ARPU) increased to $614, thanks in part to businesses upgrading their Internet and data services over time.  Almost all of total third quarter 2010 revenue was recurring service revenue. However, it continued to chalk up net losses. The loss for Q3 was $1.5 million, compared to a net loss of $1.7 million in the same period in 2009. The loss in Q2 of this year was $1.9 million.  However, earnings before interest and other expenses (EBITDA) was $1.6 million.

“With record revenue and EBITDA, accelerating customer growth and additional debt financing, we are poised to improve our results even further in Q4 and beyond,” president and CEO Bryan Boyd said in a statement.

Terago offers wireless services in the 24 GHz and 38 Ghz bands to businesses in suburban areas where wireline broadband either doesn't get to or is hard to reach, such as industrial parks. It has about 5,200 organization customers in five provinces. The company continued to expand its voice services for small and medium businesses during the quarter, adding new areas in southwestern Ontario, Ottawa, Montreal, Calgary and Edmonton.
The quarter also saw it pick up another backhaul contract from another startup cellular carrier, Toronto-based Mobilicity — which will shortly expand service to Alberta and B.C. — to join contracts with Public Mobile.

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