Financial Results
Total net revenues for 2006 increased 120% to $14.0 million compared with $6.4 million in 2005. Basic and premium service revenues, net of contractual and other discounts, comprised approximately 90% of net product revenues in 2006 and 2005.
Operating expenses increased $23.8 million or 77%, for the year ended December 31, 2006 compared to the year ended December 31, 2005, due principally to increases associated with the “net” addition of 75 new sites, increased corporate overhead and other charges associated with impairing, retiring or disposing of long-lived assets. As of December 31, 2006, the Company had 1,017 full-time and 116 part-time employees who work primarily in the areas of site operations, customer support, research and development, sales, customer service and management.
As previously disclosed, the Company expects to incur net losses for the near future as it continues to deploy a network of locations, expand sales efforts and grow operations. However, the Company believes that increased utilization rates, combined with relatively flat operating expenses due to economies of scale, will allow it to reach profitability.
The net loss for 2006 was $60.3 million, compared to a net loss of $26.9 million for the prior year; this increase was principally due to costs associated with the network deployment and the related net interest expense.