Woosh declares $2.4m loss, depends on parent for its future

New Zealand wireless broadband provider Woosh Wireless has reported a $2.4 million loss for the 10 months to August 31, with notes to the accounts disclosing the company relies on funding from Californian-based 75 percent shareholder Craig Wireless Systems to meet its cash needs.

TSX-listed CWS, in turn, warned investors last November that its own resources were strapped after two consecutive years of losses and it depended on its "ability to receive future financing through debt or equity financing, realise tax recoveries on a timely basis, and/or dispose of certain assets or operating segments and/or generate profitable operations in the future".

Since then, CWS had received some $C4.5 million in tax refunds and injected a further $US1.5 million into Woosh, which has revalued its net assets at $7.1 million, of which $6.5 million is in plant and equipment, and $1.1 million is the value of its spectrum holdings.

In January, a further $US500,000 cash injection occurred, and "the funding structure (i.e., debt or equity) will be finalised in due course".

Woosh and CWS president Gary Birkland says in the report filed with the New Zealand Companies Office that "CWS believes Woosh has real value in the spectrum it owns and the tower and telecommunications infrastructure that it has developed".

"With 4G technology reaching maturity and offering customers exciting new services, CWS will be working hard to make good use of these assets for the benefit of customer and shareholders."

Auditors Ernst & Young tagged the Woosh accounts, noting they were prepared on the presumption CWS would continue to support Woosh's operations to remain a going concern.

Woosh directors say in a note to the account on its ability to keep trading that they are "likely to be reliant on obtaining future funding from Craig or other parties in order to continue as a going concern".

"The directors are satisfied that the financial statements for the group at August 31, 2012, are appropriately prepared on a going concern basis."

A statement of comprehensive revenue for the 10 months shows revenue totalling $14.3 million against costs of $15.1 million, yielding a trading loss of $774,000.

However, losses booked to the value of $1.3 million on a redeemable preference issue involving CWS dragged the total comprehensive loss for the period, adjusted to align Woosh's balance date with CWS's, to $2.4 million.

Last week CWS's subsidiary Craig Wireless New Zealand Spectrum Operations bought management rights for an additional 35 megahertz in the 2.3 gigahertz range in New Zealand from state-owned Kordia for $2.2 million.

(BusinessDesk)


11 · Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

Post Comment

11 Comments & Questions

Commenter icon key: Subscriber Verified

It's no surprise to hear that they are bleeding cash again.

Tried Woosh twice in my life (when I was flatting) in different locations.

Terrible speed, worst customer support possible & unrealiable connection.

Yuck.

Reply
Share
  • 0
  • 0

Yes, worst ISP in NZ by a very long margin. I once had the experience of supporting a company who were directly connected to the Woosh backbone (ie CAT-5 cable from router to Woosh data centre) and still got the pathetic dribble 12kbs that they claim is "high speed internet". When downloading patches, it was faster to drive back to the office, download them there, burn to CD and drive back than it was to download locally.

Reply
Share
  • 0
  • 0

Do they own a class 5 softswitch? I've heard that a class 5 softswitch is what you need to be an ISP these days.

Reply
Share
  • 0
  • 0

I thought it was a category 5 switch?

Reply
Share
  • 0
  • 0

Wonder who will be wearing the brunt of this loss at ACC?

Reply
Share
  • 0
  • 0

What sound does a pile of cash being burned make?

"Woosh!"

Reply
Share
  • 0
  • 0

I was with Woosh way back in 2005 when their wireless service was the only true portable solution (needed when flatting). Unfortunately for them, DSL streaked ahead in terms of speed and 3G services finally became available (albeit at a much higher cost) the writing was on the wall for Woosh. When I moved to Takapuna the coverage was terrible, called Woosh and they sent a booster antenna which did help (can't fault their customer service), but the biggest problem was the bottleneck speed. As soon as Orcon launched their Purple network (Naked DSL) I was off ... went from 1.5-2Mbps down to 15Mbps+ overnight.

Reply
Share
  • 0
  • 0

Woosh was ahead of its time when it was first launched.

I used them for 2 years but gave up when their speed became slower and slower, and continuous connectivity was an issue. No good when you are trying to use it for business.

Reply
Share
  • 0
  • 0

The irony is Woosh only started to deliver some decent service and make decent money when they used fixed lines, i.e. not wireless. So the "$6.5 million is in plant and equipment" is very questionable.

Reply
Share
  • 0
  • 0

Woosh owe me $386 due to overpayment whilst they were in the midst of the slingshot transition. Rang them many times to ask where my money was and they just said they were working on it, that was a year ago and now their number is no more, can anyone help me recover my money please?

Reply
Share
  • 0
  • 0

Hi Rob I am in the same predicament as yourself during the transition I made deposits amounting to $250.00. I also kept calling and got the same response by a guy called Matt. At one point I made him send my an email stating what he said he had done to try and remedy the situation for me. Which was, he said, that he had emailed the said customer service centre. So luckily before they shut everything down I took a screenshot of this email that he had sent and I had also sent emails to the "Ghost Call Centre to which I recieved "No Reply".
Any way what I intend to do is seek legal advice from my local free lawyers who give advice.
If you get any replies from others please let me know I will keep an eye on this forum post thanks.
Thanks for your input on this I will keep in touch.

Reply
Share
  • 0
  • 0

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7032 0.0008 0.11%
AUD 0.9284 -0.0032 -0.34%
EUR 0.6440 -0.0110 -1.68%
GBP 0.5475 -0.0011 -0.20%
HKD 5.4698 0.0055 0.10%
JPY 77.6320 1.0770 1.41%

Commods

Commodity Price Change Time
Gold Index 1283.7 2.440 2017-04-21T00:
Oil Brent 52.0 -1.020 2017-04-21T00:
Oil Nymex 49.6 -1.080 2017-04-21T00:
Silver Index 17.9 -0.160 2017-04-21T00:

Indices

Symbol Open High Last %
NZX 50 7197.2 7234.3 7197.2 0.36%
NASDAQ 5919.0 5919.2 5916.8 -0.11%
DAX 12296.6 12385.6 12048.6 2.75%
DJI 20578.1 20601.4 20578.7 -0.15%
FTSE 7114.6 7251.3 7114.6 1.80%
HKSE 24185.8 24206.4 24042.0 0.41%
NI225 18890.4 18910.3 18620.8 1.37%
ASX 5854.1 5894.7 5854.1 0.30%