Tucows 2015 Annual Report Download - page 69

Adjusted EBITDA excludes depreciation, amortization of intangibles, income tax provision, interest
expense, interest income, stock-based compensation, asset impairment, net deferred revenue, which comprises the
change in deferred revenue, net of prepaid domain name registry and other Internet services fees, to reflect the material
amount of cash we collect and pay for domain registrations and other Internet services at the time of activation, losses
from foreign currency transactions and infrequently occurring items. Losses from foreign currency transactions, which
removes the effect of our foreign exchange contracts, comprise the realized gains/losses from all foreign currency
contracts, both hedged and unhedged; the unrealized effect of the change in the mark-to-market values on outstanding
unhedged foreign currency contracts, as well as the unrealized effect from the translation of monetary accounts
denominated in non-U.S. dollars to U.S. dollars.
The following table reconciles net income to adjusted EBITDA (dollars in ‘000’s):
Year ended December 31,
2015 2014 2013
Net income for the period $ 11,374 $ 6,374 $ 4,181
Depreciation of property and equipment 1,404 927 843
Amortization of intangible assets 263 596 960
Impairment of indefinite life intangible assets 206 577
Interest expense, net 159 206 355
Provision for income taxes 6,570 3,055 1,619
Change in net deferred revenue 1,084 863 425
Stock-based compensation 526 543 431
Losses from foreign currency transactions 3,618 1,612 769
Other income (86)--
Adjusted EBITDA $ 25,118 $ 14,753 $ 9,583
(1) Net deferred revenue comprises the change in deferred revenue, net of prepaid domain name registry and
other Internet services fees, to reflect the material amount of cash we collect and pay for domain registrations
and other Internet services at the time of activation. Net deferred revenue for the years ended December 31,
2015 and 2014 includes a benefit of $0.1 million as a result of the translation of deferred revenue and prepaid
domain name registry and other Internet services fees to our reporting currency of US dollars. Net deferred
revenue for the year ended December 31, 2013, includes a loss of $0.1 million as a result of the translation of
deferred revenue and prepaid domain name registry and other Internet services fees to our reporting currency
of US dollars.
(2) Previously reported amounts have been adjusted by $477,000, $287,000 and 139,000, respectively, to correct
immaterial calculation errors.
Adjusted EBITDA for the year ended December 31, 2015 increased by $10.4 million, or 70% to $25.1 million
when compared to the year ended December 31, 2014. Adjusted EBITDA for the years ended December 31, 2014
increased by $5.2 million, or 54% to $14.8 million when compared to the year ended December 31, 2013. These year-on-
year increases in adjusted EBITDA were primarily driven by the growth in Ting mobile services.
Network Access Services Year ended December 31, (1)
2015 2014 2013
(in 000’s)
Ting subscribers under management 128,000 94,000 48,000
Ting devices under management 202,000 147,000 74,000
(1)
(1)
(2)
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