During fiscal 2012, we continued to focus on quality process implementation including investing in infrastructure upgrades, management development and simplifying internal systems and procedures. During fiscal 2012, we were able to increase our overall bandwidth at a lower total cost and upgrade significant portions of our infrastructure enabling us to deliver bandwidth to our customers faster and more reliably. These efforts improved productivity and customer satisfaction, reduced customer churn, and resulted in improved adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, impairment loss, stock-based compensation expense, loss or gain on the transfer of assets and gain from bargain purchase) for the year. Adjusted EBITDA for fiscal 2012 increased 1.9% to approximately $1,267,000 as compared to adjusted EBITDA of approximately $1,242,000 for fiscal 2011. Based on present operations, we expect continued upward trend in adjusted EDITDA during fiscal 2013.
During fiscal 2012, we continued the development of the management team. Each member is enthusiastic about building a financially strong company in a somewhat difficult economic environment where many of the companies in the wireless service industry are not profitable and are having more severe challenges.
During fiscal 2012, we made capital upgrades and expansion to our infrastructure of $564,000, reduced our debt by $492,000 and invested $130,000 in acquisitions, all of which was funded with cash on hand. In spite of our significant investment in infrastructure and growth of our business through acquisitions combined with our significant pay down of debt, we are pleased that our overall cash position at June 30, 2012 remains strong at $1,433,000, which is only $79,000 lower than our cash position at June 30, 2011.
On August 1, 2012, the Company closed the purchase of wireless subscribers in and around Azle, Texas for a total estimated consideration of $71,250, which will be finalized with an issued note after November 1, 2012, or 90 days after the closing date. A closing payment of $26,000, less prepaid liabilities, was paid to the seller with cash on hand. Management believes that the estimated value of the acquired assets will not exceed the purchase consideration.
Effective cash management and efforts to improve the quality and efficiency of our operations over the last few years has well positioned us to withstand a continued economic slowdown and to capitalize on growth possibilities through internal growth and acquisitions. We believe that we have sufficient capital resources and cash on hand to withstand either a short or prolonged economic downturn. While we expect to see continuing earnings improvement in the near term, we have now turned our major focus to increasing revenues through internal growth of wireless operations using both our inside and outside sales force.
While our major focus has remained in the Texas area to date, we are positioned to drive our vision of delivering high speed broadband internet services to more geographic rural areas. In fiscal year 2012 we made our first significant venture outside the state of Texas by purchasing a wireless network in Joplin, Missouri. We believe that our continued efforts to increase our subscriber base will yield improvements in profitability and cash flow from operations. Despite our investments in the quality and efficiency of our operations over the past 18 months, we have remained EBITDA positive throughout the economic slowdown and believe that we are well positioned to withstand a continuing economic slowdown and to capitalize on growth possibilities. Management considers the acquisition of rural wireless internet service providers (“WISPs”) as a potential method of increasing subscriber count, geographic reach and recurring revenue. During the fiscal year 2012, Internet America acquired three small wireless internet service providers and has since integrated them into its existing infrastructure. Future acquisitions will only be considered if they 1) do not jeopardize continued positive EBITDA 2) have a clear path to integration and 3) will produce positive cash flow from the date of acquisition. There is no guarantee that we will make significant or numerous acquisitions.
Management considers the acquisition of rural wireless internet service providers (“WISPs”) as a potential method of increasing subscriber count, geographic reach and recurring revenue. During the fiscal year 2012, Internet America acquired three small wireless internet service providers and has since integrated them into its existing infrastructure. Future acquisitions will only be considered if they 1) do not jeopardize continued positive EBITDA 2) have a clear path to integration and 3) will produce positive cash flow from the date of acquisition. There is no guarantee that we will make significant or numerous acquisitions.
