Metrocall Reports Solid Q2 Results 2nd Quarter Produces Unit, Cash Flow and Net Revenue Increases - Company Financial Information

Cambridge Telcom Report, August 9, 1999

Metrocall, Inc. (Nasdaq: MCLL) Tuesday announced record net revenue of $145.7 million for the quarter ended June 30, 1999, an increase of approximately 52% over the quarter ended June 30, 1998. Operating cash flow (EBITDA) for the quarter ended June 30, 1999 was approximately $36.7 million, an increase of approximately 27% over the quarter ended June 30, 1998. The company reported quarterly net unit additions of 61,490. Total units increased to 5,811,705 at June 30, 1999 from 4,223,980 at June 30, 1998, an increase of approximately 37%.

William L. Collins III, President and Chief Executive Officer of Metrocall, said, "Metrocall succeeded in overcoming a highly competitive environment, producing another solid quarter of improved operating results. Growth in cash flow, net revenue and subscribers has positioned Metrocall to achieve its business goals. We accomplished all this while maintaining an extremely strong liquidity position. We posted one of the lowest leverage ratios (net debt divided by annualized EBITDA) in the industry at 5.26 and generated $10.3 million of free cash flow from operations. As we highlight the second quarter, it is important to note that we are in the process of completing the integration of the Advanced Messaging Division of AT&T Wireless and anticipate many of the projected savings associated with the transaction to occur in the second half of 1999."

"We continued to implement Metrocall's differentiation strategy which we feel will help secure Metrocall's future. We introduced to the market new content service offerings with Metrocall's 'OnTheGoInfo' system, which allows the user to personalize information feeds via the Internet, and with Strategy.com, a highly sophisticated content service provided by MicroStrategy (Nasdaq: MSTR). The quarter also marked the continued diversification of Metrocall's overall business. By selling AT&T's Digital One Rate service and Metrocall's advanced messaging products we have provided our sales force an expanded set of wireless services and applications to sell," Collins added. "The drivers in our business today are changing. We are focused on meeting those changes by developing robust wireless Internet email solutions, bundling complementary services, providing affordable alphanumeric and advanced messaging, delivering extensive information content services and meeting the needs of our increasingly sophisticated mobile customer."

Highlights of the second quarter include: -- Signed Interconnect agreement with Bell Atlantic, whereby Bell Atlantic recognizes Metrocall's co-carrier status and provides compensation for termination of calls to Metrocall's own network. Since that agreement was announced in June, Metrocall has signed agreements with other Regional Bell Operating Companies (RBOC's) and Competitive Local Exchange Carriers and we anticipate signing additional agreements with the remaining RBOC's.

-- Development and roll out of multiple content-related services, including RacePage, which delivers in-depth updates on NASCAR racing, and Healthcare Alert, which delivers health care industry updates and specialized industry-related content.

-- Announced a new agreement with PageMaster, a nationwide marketing and promotions company, to sell Metrocall pagers through consumer channels which reach some 30 million Americans. The products and companies which are promoting these service offerings are Citicorp Credit Services, The Exxon Company, GE Lighting, MasterCard BusinessCard holders, Exide NASCAR SELECT batteries, the World Wrestling Federation (WWF), Fiddle Faddle snack foods, Yoo-Hoo chocolate drink and Igloo coolers.

-- Unveiled a unique university messaging application for all incoming college students at Loyola Marymount University (LMU) in Los Angeles, California. The students were provided with an alphanumeric unit which allowed LMU to provide critical information updates during the summer and eventually during the school year. This program is expected to be duplicated at other colleges and universities in the coming quarters.

-- Rolled out products and services to an additional 233 AT&T Wireless retail locations bringing the total store coverage to 619. Metrocall has a five-year exclusive agreement with AT&T Wireless to provide messaging products and services to their retail stores. Metrocall anticipates adding several dozen additional locations in the second half of 1999.

-- Sales of Metrocall's Integrated Resource Management System (IRMS) generated 10 upgrades or new installations to the next generation IPT 3000 switch. The switch allows customers with campus environments to control wireless messaging networks throughout their entire organization using existing customer-owned equipment such as a local area network computer system.

Metrocall, Inc., headquartered in Alexandria, Virginia, is one of the largest paging and wireless messaging companies in the United States serving over 5.8 million subscribers, through its Nationwide Wireless Network. FMI: www.metrocall.com.