Exhibit 99.1

 

 

NEWS RELEASE

 

FOR IMMEDIATE RELEASE

CONTACT:

978-619-1300

Wednesday October 24, 2018

 

Michael T. Prior

 

 

Chairman and

 

 

Chief Executive Officer

 

 

 

 

 

Justin D. Benincasa

 

 

Chief Financial Officer

 

ATN Reports Third Quarter 2018 Results

 

·                  Another Quarter of Sequential Earnings Growth

·                  Restoration of US Virgin Islands Network Almost Complete

 

Third Quarter Financial Highlights:

 

·                  Revenues: $121.1 million

·                  Adjusted EBITDA(1): $38.9 million

·                  Operating income: $30.8 million

·                  Net income attributable to ATN stockholders: $17.0 million, or $1.06 per diluted share

·                  Cash flow from operating activities for first nine months of 2018 was $98.0 million

 

Beverly, MA (October 24, 2018) — ATN (Nasdaq: ATNI) today reported results for the third quarter ended September 30, 2018.

 

Business Review and Outlook

 

“Our third quarter results largely followed the same favorable trends as the second quarter.  We continued to see sequential growth in profitability, reflecting positive comparisons in our international telecom operations and the receipt of additional FCC USF support,” said Michael Prior, Chairman and Chief Executive Officer.  “More specifically, International Telecom’s operating performance benefitted from continued margin expansion in many of our markets, and progress in re-building our U.S. Virgin Islands network, which was destroyed by the September 2017 hurricanes.  We have made significant investments well beyond the additional FCC support to re-build our networks in the USVI, and network performance levels now exceed those that prevailed before the 2017 hurricanes. At this point, our network re-build is substantially complete, though work is continuing in some of the more challenging geographical areas.  However, we believe it will be some time before our wireline service revenues in that market will reach pre-storm levels.   Our U.S. Telecom operation performed in line with our expectations, which has kept us on track to meet our segment revenue guidance of $110 million to $120 million for full year 2018.  In the third

 


 

quarter we participated in the Connect America Phase II auction to bring fixed broadband and voice services to rural areas in the U.S., and were awarded $79 million in funding over the next 10 years, subject to FCC build out and coverage requirements.  The coverage areas are generally in the Southwestern United States and around our existing mobile network coverage areas.

 

“In addition to the underlying sequential earnings growth achieved in the third quarter, operating and net income benefitted from a gain on the completion of our previously-disclosed sale of approximately 100 wholesale cell sites in the U.S. Telecom segment. Similarly, we expect to report an additional gain in this year’s fourth quarter following the completion of our recently-announced sale of our U.S. solar portfolio if the transaction closes as and when expected.  At the same time, we are continuing to invest in solar power facilities in other markets and look for other opportunities in the renewable energy sector as well.

 

“As mentioned last quarter, we have several initiatives under way in which we have invested some of our balance sheet capacity in early-stage small businesses to pursue growth.  We remain optimistic that with pressure on large carriers to seek better network economics and focus internal spending on areas of strategic differentiation, there will be opportunities for us to put capital to work in shared infrastructure solutions,” Mr. Prior noted.

 

Third Quarter 2018 Financial Results

 

Third quarter 2018 revenues of $121.1 million were relatively flat compared to the $122.1 million reported for the third quarter of 2017 which was also impacted by the 2017 hurricanes. The sale of our British Virgin Islands business in late 2017 and the destruction of much of our U.S. Virgin Islands wireline network from the 2017 hurricanes reduced revenue by approximately $2.6 million. Additionally, U.S. wireless revenues declined $8.0 million, as anticipated, due to previously-agreed revenue caps and other contract changes.  These reductions were mostly offset by revenue from an additional $7.2 million of USF high cost support funding from the FCC for our U.S. Virgin Islands business and increases in international wireless and broadband revenues.  Adjusted EBITDA(1) for the third quarter of 2018 was $38.9 million, or 3% above the prior year period, primarily due to margin expansion and the additional USF funding received this quarter in the International Telecom segment offsetting the revenue declines in the U.S. Telecom segment.  Operating income for the third quarter was $30.8 million, including a net gain on sale of fixed assets of $13.5 million, compared to the prior year operating loss of $19.6 million, which included $36.6 million of losses from damaged assets and other hurricane related charges.  Net income attributable to ATN’s stockholders for the third quarter was $17.0 million or $1.06 per diluted share compared with the prior year period’s net loss attributable to ATN stockholders of $24.8 million or $1.53 per share.

 

Revenues for the first nine months of 2018 were $343.4 million, 8% below the $373.5 million reported for the same period in 2017.  This revenue decline reflects the nine-month impact of the revenue changes highlighted in the third quarter comparison.  Correspondingly, Adjusted EBITDA(1) for the first nine months of 2018 was $101.2 million, a decrease of 14% from the prior year period and operating income for the first nine months of 2018 was $50.8 million compared with the prior year period’s operating income of $14.0 million, which included $36.6 million of losses from damaged assets and other hurricane related charges.  Net income attributable to ATN stockholders for the first nine months of 2018 was $18.7 million or $1.16 per diluted share, compared with the prior year period’s net loss attributable to ATN stockholders of $12.0 million or $0.74 per share.

 

Third Quarter 2018 Operating Highlights

 

The Company has three reportable segments: (i) U.S. Telecom; (ii) International Telecom; and (iii) Renewable Energy.

 


(1)  See Table 5 for reconciliation of Net Income to Adjusted EBITDA.

 

2


 

U.S. Telecom

 

U.S. Telecom revenues consist mainly of wireless revenues from our voice and data wholesale roaming operations and our smaller retail operations in the Southwestern United States, as well as enterprise and wholesale wireline revenues.  Total U.S. Telecom segment revenues were $31.8 million in the third quarter of 2018, a 21% decline from the $40.1 million reported in the third quarter of 2017.  U.S. wireless revenues decreased 21% to $29.8 million compared with $37.8 million in the prior year quarter due to the impact of previously agreed upon wholesale wireless contract changes and the completion of the sale of approximately 100 wholesale wireless cell sites early in the third quarter of 2018.

 

U.S. Telecom Adjusted EBITDA(1) of $13.5 million in the third quarter of 2018 decreased 38% compared to the prior year period’s $21.7 million.  The decline was mostly due to the reduction in wireless revenues and the sale of sites noted above, along with the cost of our earlier stage business initiatives.

 

International Telecom

 

International Telecom consists of a broad range of information and communications services including wireline and wireless data, internet, voice and video service revenues from our operations in Bermuda and the Caribbean.  International Telecom revenues were $83.9 million in the third quarter of 2018, a 9% increase from the $77.0 million reported in the third quarter of 2017 mainly due to increased wireless and broadband revenues in Guyana, the Cayman Islands and Bermuda, and supported by additional USF funding of $7.2 million by the FCC for high cost support received in the quarter. These positive developments more than offset a reduction of approximately $1.6 million in revenue from the extensive network damage in the U.S. Virgin Islands, as well as a $1.0 million revenue reduction due to the sale of our British Virgin Islands business in the third quarter of 2017. While we expect continued sequential revenue improvement in the fourth quarter (excluding the Q3 USF revenue benefit), the level of damage to the U.S. Virgin Islands economy and our customer base and the move by some to secure alternative services may mean that it will take some time before we see a full return to pre-storm levels in that market.  We have significantly invested in re-building the network and have expanded and accelerated plans to build additional resiliency and capabilities into our USVI network.

 

International Telecom Adjusted EBITDA(1) of $28.6 million in the third quarter increased 41% from $20.3 million in the prior year period.  The increase is primarily the result of the noted additional USF revenue benefit in the U.S. Virgin Islands and in the growth in other markets against a backdrop of improving operating margins.

 

Renewable Energy

 

Renewable Energy segment revenues are generated principally by the generation and sale of energy and solar renewable energy credits from our commercial solar projects in the United States and India.  For the third quarter of 2018, revenues from our renewable energy business were $5.4 million, an increase of 8% from $5.0 million in the prior year period due mainly to higher revenue generated from newly completed solar projects in India.  The growth in India power production revenue also drove an increase in Adjusted EBITDA(1) for the Renewable Energy segment to $3.1 million in the third quarter, up $0.5 million from the prior year’s quarter.

 

The sale of our U.S. solar portfolio currently is expected to close in the fourth quarter and we expect to record a gain on this sale.  The transaction will reduce this segment’s revenue and Adjusted EBITDA(1) compared to the prior year periods beginning in the period of the sale.  In the third quarter of 2018 the U.S. solar portfolio had revenues of $4.2 million.

 

3


 

Balance Sheet and Cash Flow Highlights

 

Total cash at September 30, 2018 was $174.0 million.  Additionally, the Company ended the third quarter with $0.3 million in short-term investments.  Net cash provided by operating activities was $98.0 million for the first nine months of 2018, compared with $122.0 million for the prior year period.  The decrease in net cash provided by operating activities is primarily due to the revenue reductions in the U.S. Telecom wireless business and the wireline business in the U.S. Virgin Islands.  During the first nine months of 2018, the Company used net cash of $143.6 million for investing and financing activities.  This included $78.9 million of capital expenditures for network repairs and resiliency enhancements to the network following the 2017 hurricanes in the U.S. Virgin Islands,   $75.4 million in other capital expenditures and $15.3 million in partner distributions.  The $78.9 million of repairs and resiliency enhancements were partially offset by $34.6 million of insurance proceeds and $15.4 million of FCC USF support.  We also estimate that capital expenditures in the telecom segments for the full year 2018 will be between $90.0 and $95.0 million, as we see strong customer demand for the fiber network expansions in the International Telecom segment, and have accelerated certain of the growth capital expenditures planned for 2019 into 2018.

 

The pending sale of the U.S. solar business resulted in the classification of the related assets and liabilities of that business as held for sale as of September 30, 2018.  As a result, $97.5 million of assets and $80.7 million of liabilities are presented as held for sale on the balance sheet as of September 30, 2018.

 

Conference Call Information

 

ATN will host a conference call on Thursday, October 25, 2018 at 9:30 a.m. Eastern Time (ET) to discuss its third quarter 2018 results. The call will be hosted by Michael Prior, Chairman and Chief Executive Officer, and Justin Benincasa, Chief Financial Officer. The dial-in numbers are US/Canada: (877) 734-4582 and International: (678) 905-9376, conference ID 3846598. A replay of the call will be available at ir.atni.com beginning at 1:00 p.m. (ET) on October 25, 2018.

 

About ATN

 

ATN International, Inc. (Nasdaq: ATNI), headquartered in Beverly, Massachusetts, invests in and operates communications, energy and technology businesses in the United States and internationally, including the Caribbean region and Asia-Pacific, with a particular focus on markets with a need for significant infrastructure investments and improvements. Our operating subsidiaries today primarily provide: (i) advanced wireless and wireline connectivity to residential and business customers, including a range of mobile wireless solutions, high speed internet services, video services and local exchange services, (ii) distributed solar electric power to corporate and government customers and (iii) wholesale communications infrastructure services such as terrestrial and submarine fiber optic transport, communications tower facilities, managed mobile networks, and in-building systems. For more information, please visit www.atni.com.

 

Cautionary Language Concerning Forward Looking Statements

 

This press release contains forward-looking statements relating to, among other matters, our future financial performance and results of operations; the estimated timeline for the rebuilding of our   operations and revenues from our customers in the U.S. Virgin Islands following the hurricanes; our estimates of total losses due to the hurricanes and our estimated costs of restoring hurricane-damaged services; our ability to receive financial support from the government for our rebuild in the U.S. Virgin Islands and the timing of such support; the competitive environment in our key markets, demand for our services and industry trends; the pace of expansion and improvement of our telecommunications network and renewable energy operations including our level of estimated future capital expenditures and our realization of the benefits of these investments; the anticipated timing of our build schedule and energy production of our India renewable energy projects; and management’s plans and strategy for the future. These forward-looking statements are based on estimates, projections, beliefs, and assumptions and are not guarantees of future events or results.  Actual future events and results could differ materially from the events and results

 

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indicated in these statements as a result of many factors, including, among others, (1)   our ability to fully restore our networks and customer services in the U.S. Virgin Islands to the level prior to the 2017 hurricanes, including obtaining governmental or other support necessary to do so; (2) our ability to execute planned network expansions and upgrades in our various markets; (3) the general performance of our operations, including operating margins, revenues, capital expenditures, and the future growth and retention of our major customers and subscriber base and consumer demand for solar power; (4) government regulation of our businesses, which may impact our FCC and other telecommunications licenses or our renewables business; (5) economic, political and other risks facing our operations; (6) our ability to maintain favorable roaming arrangements and satisfy the needs and demands of our major wireless customers; (7) our ability to efficiently and cost-effectively upgrade our networks and IT platforms to address  rapid and significant technological changes in the telecommunications industry; (8) the loss of or an inability to recruit skilled personnel in our various jurisdictions, including key members of management; (9) our ability to find investment or acquisition or disposition opportunities that fit the strategic goals of the Company; (10) increased competition; (11) our ability to expand our renewable energy business; (12) our reliance on a limited number of key suppliers and vendors for timely supply of equipment and services relating to our network infrastructure; (13) the adequacy and expansion capabilities of our network capacity and customer service system to support our customer growth; (14) the occurrence of weather events and natural catastrophes; (15) our continued access to capital and credit markets; (16) the risk of currency fluctuation for those markets in which we operate; (17) the closing of the U.S. solar asset sale as and when expected and the satisfaction of the conditions to closing ; and (18)  our ability to realize the value that we believe exists in our businesses.  These and other additional factors that may cause actual future events and results to differ materially from the events and results indicated in the forward-looking statements above are set forth more fully under Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on March 1, 2018 and the other reports we file from time to time with the SEC.  The Company undertakes no obligation and has no intention to update these forward-looking statements to reflect actual results, changes in assumptions or changes in other factors that may affect such forward-looking statements.

 

Use of Non-GAAP Financial Measures

 

In addition to financial measures prepared in accordance with generally accepted accounting principles (GAAP), this press release also contains non-GAAP financial measures. Specifically, ATN has presented the following measures in this release and in the tables included herein:  Adjusted EBITDA; Operating Income excluding hurricane charges; Net income (loss) attributable to ATN’s stockholders excluding hurricane charges; and Net income (loss) per share attributable to ATN stockholders excluding hurricane charges.

 

Adjusted EBITDA is defined as net income attributable to ATN stockholders before (gain) loss on disposition of long-lived assets, restructuring charges, interest, taxes, depreciation and amortization, transaction-related charges, other income or expense, loss on damaged assets and other hurricane charges, net of insurance recovery and net income attributable to non-controlling interests.

 

Operating Income excluding hurricane charges is defined as Operating Income (Loss) adjusted for loss on damaged assets and other hurricane related charges.  Net income (loss) attributable to ATN stockholders excluding hurricane charges is defined as Net income (loss) attributable to ATN stockholders adjusted for loss on damaged assets and other hurricane related charges.

 

Net income (loss) per share attributable to ATN stockholders excluding hurricane charges is defined as net income (loss) per share attributable to ATN stockholders adjusted for loss on damaged assets and other hurricane related charges.

 

The Company believes that the inclusion of these non-GAAP financial measures helps investors gain a meaningful understanding of the Company’s core operating results and enhances the usefulness of comparing such performance with prior periods. ATN’s management uses these non-GAAP measures, in addition to GAAP financial measures, as the basis for measuring our core operating performance and comparing such performance to that of prior periods. The non-GAAP financial measures included in this

 

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press release are not meant to be considered superior to or a substitute for results of operations prepared in accordance with GAAP. Reconciliations of these non-GAAP financial measures used in this press release to the most directly comparable GAAP financial measure is set forth in the text of, and the accompanying tables to, this press release.  While our non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, we urge investors to review the reconciliation of these financial measures to the comparable GAAP financial measures included below, and not to rely on any single financial measure to evaluate our business.

 

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Table 1

ATN International, Inc.

Unaudited Condensed Consolidated Balance Sheets

(in Thousands)

 

 

 

September 30,

 

December 31,

 

 

 

2018

 

2017

 

Assets:

 

 

 

 

 

Cash and cash equivalents

 

$

161,112

 

$

207,956

 

Restricted cash

 

1,071

 

833

 

Short-term investments

 

314

 

7,076

 

Other current assets

 

89,323

 

127,063

 

Assets held for sale

 

97,477

 

 

Total current assets

 

349,297

 

342,928

 

 

 

 

 

 

 

Long-term restricted cash

 

11,768

 

11,101

 

Property, plant and equipment, net

 

614,427

 

643,146

 

Goodwill and other intangible assets, net

 

169,785

 

171,656

 

Other assets

 

38,773

 

36,774

 

Total assets

 

$

1,184,050

 

$

1,205,605

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity:

 

 

 

 

 

Current portion of long-term debt

 

$

4,688

 

$

10,919

 

Taxes payable

 

12,789

 

6,751

 

Other current liabilities

 

117,176

 

144,035

 

Liabilities held for sale

 

80,673

 

 

Total current liabilities

 

215,326

 

161,705

 

 

 

 

 

 

 

Long-term debt, net of current portion

 

$

87,183

 

$

144,873

 

Deferred income taxes

 

7,614

 

31,732

 

Other long-term liabilities

 

44,880

 

37,072

 

Total long-term liabilities

 

139,677

 

213,677

 

 

 

 

 

 

 

Total liabilities

 

355,003

 

375,382

 

 

 

 

 

 

 

Total ATN International, Inc.’s stockholders’ equity

 

697,655

 

688,727

 

Non-controlling interests

 

131,392

 

141,496

 

Total equity

 

829,047

 

830,223

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

1,184,050

 

$

1,205,605

 

 

7


 

Table 2

ATN International, Inc.

Unaudited Condensed Consolidated Statements of Operations

(in Thousands, Except per Share Data)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2018

 

2017

 

2018

 

2017

 

Revenues:

 

 

 

 

 

 

 

 

 

Wireless

 

$

52,003

 

$

60,305

 

$

153,046

 

$

175,777

 

Wireline

 

63,717

 

56,817

 

173,083

 

182,777

 

Renewable energy

 

5,418

 

5,010

 

17,272

 

14,938

 

Total revenue

 

121,138

 

122,132

 

343,401

 

373,492

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Termination and access fees

 

29,866

 

30,554

 

84,037

 

94,478

 

Engineering and operations

 

18,177

 

18,852

 

54,738

 

57,881

 

Sales, marketing and customer service

 

8,995

 

8,440

 

25,969

 

26,176

 

General and administrative

 

25,210

 

26,660

 

77,470

 

77,089

 

Transaction-related charges

 

178

 

61

 

642

 

887

 

Depreciation and amortization

 

21,384

 

21,157

 

64,602

 

65,904

 

(Gain) Loss on disposition of assets

 

(13,496

)

(593

)

(15,509

)

513

 

Loss on damaged assets and other hurricane related charges

 

 

36,566

 

666

 

36,566

 

Total operating expenses

 

90,314

 

141,697

 

292,615

 

359,494

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

30,824

 

(19,565

)

50,786

 

13,998

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

Interest expense, net

 

(1,661

)

(1,645

)

(5,339

)

(5,480

)

Loss on deconsolidation of subsidiary

 

 

 

 

(529

)

Other income (expense)

 

(1,244

)

(650

)

(3,042

)

(1,631

)

Other expense, net

 

(2,905

)

(2,295

)

(8,381

)

(7,640

)

 

 

 

 

 

 

 

 

 

 

Income (Loss) before income taxes

 

27,919

 

(21,860

)

42,405

 

6,358

 

Income tax expense (benefit)

 

7,010

 

(884

)

13,018

 

4,839

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

20,909

 

(20,976

)

29,387

 

1,519

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to non-controlling interests, net

 

(3,887

)

(3,784

)

(10,705

)

(13,535

)

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) attributable to ATN International, Inc. stockholders

 

$

17,022

 

$

(24,760

)

$

18,682

 

$

(12,016

)

 

 

 

 

 

 

 

 

 

 

Net income (loss) per weighted average share attributable to ATN International, Inc. stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic Net Income

 

$

1.07

 

$

(1.53

)

$

1.17

 

$

(0.74

)

 

 

 

 

 

 

 

 

 

 

Diluted Net Income

 

$

1.06

 

$

(1.53

)

$

1.16

 

$

(0.74

)

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

15,958

 

16,178

 

15,987

 

16,177

 

Diluted

 

16,021

 

16,178

 

16,042

 

16,177

 

 

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Table 3

 

ATN International, Inc.

Unaudited Condensed Consolidated Cash Flow Statement

(in Thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2018

 

2017

 

 

 

 

 

 

 

Net income

 

$

29,387

 

$

1,519

 

Depreciation and amortization

 

64,602

 

65,904

 

Provision for doubtful accounts

 

4,199

 

3,041

 

(Gain) Loss on disposition of assets

 

(15,509

)

513

 

Loss on deconsolidation of subsidiary

 

 

529

 

Stock-based compensation

 

5,071

 

5,437

 

Loss on damaged assets and other hurricane related charges

 

 

35,213

 

Loss in equity method investments

 

 

2,033

 

Deferred income taxes

 

(3,062

)

1,456

 

Change in prepaid and accrued income taxes

 

10,558

 

(7,966

)

Change in other operating assets and liabilities

 

(20

)

14,393

 

Other non-cash activity

 

2,788

 

(84

)

 

 

 

 

 

 

Net cash provided by operating activities

 

98,014

 

121,988

 

 

 

 

 

 

 

Capital expenditures

 

(75,375

)

(108,276

)

Hurricane rebuild capital expenditures

 

(78,903

)

 

Hurricane insurance proceeds

 

34,606

 

 

Acquisition of business

 

 

(1,183

)

Sale of business, net of transferred cash of $0 and $2.1 million

 

926

 

22,381

 

Purchases of spectrum licenses and other intangible assets, including deposits

 

 

(36,832

)

Net proceeds from sale of assets

 

4,130

 

 

Purchases of investments

 

(3,000

)

(18,107

)

Proceeds from sale of investments

 

6,564

 

2,761

 

Government grants

 

5,400

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

(105,652

)

(139,256

)

 

 

 

 

 

 

Dividends paid on common stock

 

(8,153

)

(16,502

)

Distributions to non-controlling interests

 

(15,271

)

(3,583

)

Principal repayments of term loan

 

(5,723

)

(5,446

)

Proceeds from new borrowings

 

 

8,571

 

Purchases of common stock

 

(3,677

)

(11,139

)

Acquisition of business, net of acquired cash of $0

 

 

(1,178

)

Repurchases of non-controlling interests

 

(5,196

)

(1,104

)

Other

 

72

 

727

 

 

 

 

 

 

 

Net cash used in financing activities

 

(37,948

)

(29,654

)

 

 

 

 

 

 

Effect of foreign currency exchange rates on total cash

 

(353

)

200

 

 

 

 

 

 

 

Net change in total cash

 

(45,939

)

(46,722

)

 

 

 

 

 

 

Total cash, cash equivalents and restricted cash, beginning of period

 

219,890

 

288,358

 

 

 

 

 

 

 

Total cash, cash equivalents and restricted cash, end of period

 

$

173,951

 

$

241,636

 

 

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Table 4

 

ATN International, Inc.

Selected Segment Financial Information

(In Thousands)

 

For the three months ended September 30, 2018 is as follows:

 

 

 

U.S. Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate and
Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations Data:

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

29,784

 

$

22,219

 

$

 

$

 

$

52,003

 

Wireline

 

2,024

 

61,693

 

 

 

63,717

 

Renewable Energy

 

 

 

5,418

 

 

5,418

 

Total Revenue

 

$

31,808

 

$

83,912

 

$

5,418

 

$

 

$

121,138

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

22,773

 

$

16,239

 

$

(177

)

$

(8,011

)

$

30,824

 

Non-controlling interest ( net income or (loss) )

 

$

(1,299

)

$

(2,375

)

$

(213

)

$

 

$

(3,887

)

 

 

 

 

 

 

 

 

 

 

 

 

Non GAAP measure:

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

13,529

 

$

28,645

 

$

3,090

 

$

(6,375

)

$

38,889

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet Data (at September 30, 2018):

 

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and investments

 

$

25,202

 

$

50,753

 

$

12,085

 

$

73,386

 

$

161,426

 

Assets held for sale

 

 

 

97,477

 

 

97,477

 

Total current assets

 

48,003

 

99,624

 

121,070

 

80,600

 

349,297

 

Fixed assets, net

 

80,088

 

473,086

 

41,716

 

19,537

 

614,427

 

Total assets

 

187,831

 

640,123

 

178,663

 

177,433

 

1,184,050

 

Liabilities held for sale

 

 

 

80,673

 

 

80,673

 

Total current liabilities

 

23,825

 

84,310

 

84,659

 

22,532

 

215,326

 

Total debt

 

 

91,871

 

 

 

91,871

 

 

ATN International, Inc.

Selected Segment Financial Information

(In Thousands)

 

For the three months ended September 30, 2017 is as follows:

 

 

 

U.S. Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate and
Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations Data:

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

37,774

 

$

22,531

 

$

 

$

 

$

60,305

 

Wireline

 

2,336

 

54,481

 

 

 

56,817

 

Renewable Energy

 

 

 

5,010

 

 

5,010

 

Total Revenue

 

$

40,110

 

$

77,012

 

$

5,010

 

$

 

$

122,132

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

15,987

 

$

(28,531

)

$

976

 

$

(7,997

)

$

(19,565

)

Non-controlling interest ( net income or (loss) )

 

$

(1,268

)

$

(2,243

)

$

(273

)

$

 

$

(3,784

)

 

 

 

 

 

 

 

 

 

 

 

 

Non GAAP measure:

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

21,695

 

$

20,300

 

$

2,632

 

$

(7,001

)

$

37,626

 

 


*  Corporate and Other refer to corporate overhead expenses and consolidating adjustments

 

10



 

ATN International, Inc.

Selected Segment Financial Information

(In Thousands)

 

For the nine months ended September 30, 2018 is as follows:

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate and
Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations Data:

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

85,767

 

$

67,279

 

$

 

$

 

$

153,046

 

Wireline

 

4,824

 

168,259

 

 

 

173,083

 

Renewable Energy

 

 

 

17,272

 

 

17,272

 

Total Revenue

 

$

90,591

 

$

235,538

 

$

17,272

 

$

 

$

343,401

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

35,839

 

$

37,449

 

$

3,687

 

$

(26,189

)

$

50,786

 

Non-controlling interest ( net income or (loss) )

 

$

(2,771

)

$

(7,209

)

$

(725

)

$

 

$

(10,705

)

 

 

 

 

 

 

 

 

 

 

 

 

Non GAAP measure:

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

38,208

 

$

74,055

 

$

10,691

 

$

(21,767

)

$

101,187

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Cash Flow Data:

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

$

9,460

 

$

136,791

 

$

1,641

 

$

6,386

 

$

154,278

 

 

ATN International, Inc.

Selected Segment Financial Information

(In Thousands)

 

For the nine months ended September 30, 2017 is as follows:

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate and
Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations Data:

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

110,398

 

$

65,379

 

$

 

$

 

$

175,777

 

Wireline

 

10,483

 

172,294

 

 

 

182,777

 

Renewable Energy

 

 

 

14,938

 

 

14,938

 

Total Revenue

 

$

120,881

 

$

237,673

 

$

14,938

 

$

 

$

373,492

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

44,520

 

$

(7,833

)

$

3,263

 

$

(25,952

)

$

13,998

 

Non-controlling interest ( net income or (loss) )

 

$

(5,441

)

$

(7,256

)

$

(838

)

$

 

$

(13,535

)

 

 

 

 

 

 

 

 

 

 

 

 

Non GAAP measure:

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

$

64,131

 

$

67,247

 

$

8,204

 

$

(21,714

)

$

117,868

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Cash Flow Data:

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

$

17,395

 

$

54,775

 

$

31,327

 

$

4,779

 

$

108,276

 

 


*  Corporate and Other refer to corporate overhead expenses and consolidating adjustments

 

11


 

ATN International, Inc.

Selected Segment Financial Information

(In Thousands)

 

For the year ended December 31, 2017 is as follows:

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate and
Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet Data (at December 31, 2017):

 

 

 

 

 

 

 

 

 

 

 

Cash, cash equivalents and investments

 

$

19,585

 

$

110,700

 

$

8,120

 

$

76,627

 

$

215,032

 

Total current assets

 

40,975

 

190,396

 

18,060

 

93,497

 

342,928

 

Fixed assets, net

 

99,462

 

367,485

 

158,447

 

17,752

 

643,146

 

Total assets

 

200,142

 

629,007

 

192,406

 

184,050

 

1,205,605

 

Total current liabilities

 

41,248

 

91,887

 

14,754

 

13,816

 

161,705

 

Total debt

 

 

94,577

 

61,215

 

 

155,792

 

 


*  Corporate and Other refer to corporate overhead expenses and consolidating adjustments

 

ATN International, Inc.

Selected Segment Operational Data

 

 

 

Quarter ended

 

 

 

September 30,

 

December 31,

 

March 31,

 

June 30,

 

September 30,

 

 

 

2017

 

2017

 

2018

 

2018

 

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Telecom Operational Data:

 

 

 

 

 

 

 

 

 

 

 

Wireless - Total Domestic Base Stations

 

1,061

 

1,100

 

1,122

 

1,121

 

1,035

 

 

 

 

 

 

 

 

 

 

 

 

 

International Telecom Operational Data:

 

 

 

 

 

 

 

 

 

 

 

Wireline - Voice / Access lines*

 

162,500

 

161,500

 

165,300

 

168,400

 

170,400

 

Wireline - Data Subscribers*

 

105,000

 

107,000

 

109,800

 

113,200

 

115,900

 

Wireline - Video Subscribers

 

46,700

 

45,700

 

44,500

 

43,400

 

43,600

 

Wireless - Subscribers*

 

302,000

 

307,200

 

310,700

 

308,700

 

301,300

 

 


* Subscriber counts were adjusted for all periods presented based upon a change in methodology

 

12



 

Table 5

 

ATN International, Inc.

Reconciliation of Non-GAAP Measures

(In Thousands)

 

Reconciliation of Net Income to Adjusted EBITDA for the Three Months Ended September 30, 2018 and 2017

 

Three Months Ended September 30, 2018

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate
and Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

17,022

 

Net income attributable to non-controlling interests, net of tax

 

 

 

 

 

 

 

 

 

3,887

 

Income tax expense

 

 

 

 

 

 

 

 

 

7,010

 

Other (income) expense, net

 

 

 

 

 

 

 

 

 

1,244

 

Interest expense, net

 

 

 

 

 

 

 

 

 

1,661

 

Operating income

 

$

22,773

 

$

16,239

 

$

(177

)

$

(8,011

)

$

30,824

 

Depreciation and amortization

 

5,665

 

12,441

 

1,819

 

1,458

 

21,383

 

(Gain) Loss on disposition of assets

 

(14,909

)

(35

)

1,448

 

 

(13,496

)

Transaction-related charges

 

 

 

 

178

 

178

 

Adjusted EBITDA

 

$

13,529

 

$

28,645

 

$

3,090

 

$

(6,375

)

$

38,889

 

 

Three Months Ended September 30, 2017

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate
and Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (loss) attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

(24,760

)

Net income attributable to non-controlling interests, net of tax

 

 

 

 

 

 

 

 

 

3,784

 

Income tax benefit

 

 

 

 

 

 

 

 

 

(884

)

Other expense, net

 

 

 

 

 

 

 

 

 

650

 

Interest expense, net

 

 

 

 

 

 

 

 

 

1,645

 

Operating income

 

$

  15,987

 

$

  (28,531

)

$

  976

 

$

  (7,997

)

$

  (19,565

)

Depreciation and amortization

 

6,301

 

12,088

 

1,656

 

1,112

 

21,157

 

(Gain) Loss on disposition of assets

 

(593

)

 

 

 

(593

)

Loss on damaged assets and other hurricane related charges, net of insurance recovery

 

 

36,566

 

 

 

36,566

 

Transaction-related charges

 

 

177

 

 

(116

)

61

 

Adjusted EBITDA

 

$

  21,695

 

$

  20,300

 

$

  2,632

 

$

  (7,001

)

$

  37,626

 

 


*  Corporate and Other refer to corporate overhead expenses and consolidating adjustments

 

13


 

Reconciliation of Net Income to Adjusted EBITDA for the Nine Months Ended September 30, 2018 and 2017

 

Nine Months Ended September 30, 2018

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate
and Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

  18,682

 

Net income attributable to non-controlling interests, net of tax

 

 

 

 

 

 

 

 

 

10,705

 

Income tax expense

 

 

 

 

 

 

 

 

 

13,018

 

Other (income) expense, net

 

 

 

 

 

 

 

 

 

3,042

 

Interest expense, net

 

 

 

 

 

 

 

 

 

5,339

 

Operating income

 

$

  35,839

 

$

  37,449

 

$

  3,687

 

$

  (26,189

)

$

  50,786

 

Depreciation and amortization

 

19,013

 

35,907

 

5,492

 

4,190

 

64,602

 

(Gain) Loss on disposition of assets

 

(17,054

)

33

 

1,512

 

 

(15,509

)

Loss on damaged assets and other hurricane related charges

 

 

666

 

 

 

666

 

Transaction-related charges

 

410

 

 

 

232

 

642

 

Adjusted EBITDA

 

$

  38,208

 

$

  74,055

 

$

  10,691

 

$

  (21,767

)

$

  101,187

 

 

Nine Months Ended September 30, 2017

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Corporate
and Other *

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

  (12,016

)

Net income attributable to non-controlling interests, net of tax

 

 

 

 

 

 

 

 

 

13,535

 

Income tax expense

 

 

 

 

 

 

 

 

 

4,839

 

Other expense, net

 

 

 

 

 

 

 

 

 

1,631

 

Loss on deconsolidation of subsidiary

 

 

 

 

 

 

 

 

 

529

 

Interest expense, net

 

 

 

 

 

 

 

 

 

5,480

 

Operating income

 

$

  44,520

 

$

  (7,833

)

$

  3,263

 

$

  (25,952

)

$

  13,998

 

Depreciation and amortization

 

19,098

 

38,337

 

4,941

 

3,528

 

65,904

 

(Gain) Loss on disposition of assets

 

513

 

 

 

 

513

 

Loss on damaged assets and other hurricane related charges

 

 

36,566

 

 

 

36,566

 

Transaction-related charges

 

 

177

 

 

710

 

887

 

Adjusted EBITDA

 

$

  64,131

 

$

  67,247

 

$

  8,204

 

$

  (21,714

)

$

  117,868

 

 


*  Corporate and Other refer to corporate overhead expenses and consolidating adjustments

 

14



 

Table 6

 

ATN International, Inc.

(In Thousands)

Reconciliation of GAAP measures to Non-GAAP measures

 

Reconciliation of Operating Income (Loss) to Operating Income excluding hurricane charges, Net Income (Loss) attributable to ATN stockholders to Net Income (Loss) attributable to ATN stockholders excluding hurricane charges and Net Income (Loss) per share attributable to ATN stockholders to Net Income (Loss) per share attributable to ATN stockholders excluding hurricane charges

 

For the Three Months Ended September 30, 2018 is as follows:

 

 

 

Operating Income (Loss)

 

Net Income (Loss)
Attributable to ATN
Stockholders

 

Net Income (Loss) per
share Attributable to ATN
Stockholders

 

 

 

 

 

 

 

 

 

GAAP - As reported

 

$

30,824

 

$

17,022

 

$

1.06

 

Adjust for: Loss on damaged assets and other hurricane related charges

 

 

 

 

Tax effect

 

 

 

 

Non-GAAP

 

$

30,824

 

$

17,022

 

$

1.06

 

 

For the Three Months Ended September 30, 2017 is as follows:

 

 

 

Operating Income (Loss)

 

Net Income (Loss)
Attributable to ATN
Stockholders

 

Net Income (Loss) per
share Attributable to ATN
Stockholders

 

 

 

 

 

 

 

 

 

GAAP - As reported

 

$

(19,565

)

$

(24,760

)

$

(1.53

)

Adjust for: Loss on damaged assets and other hurricane related charges

 

36,566

 

36,566

 

2.26

 

Tax effect

 

 

69

 

0.00

 

Non-GAAP

 

$

17,001

 

$

11,875

 

$

0.73

 

 

For the Nine Months Ended September 30, 2018 is as follows:

 

 

 

Operating Income (Loss)

 

Net Income (Loss)
Attributable to ATN
Stockholders

 

Net Income (Loss) per
share Attributable to ATN
Stockholders

 

 

 

 

 

 

 

 

 

GAAP - As reported

 

$

50,786

 

$

18,682

 

$

1.16

 

Adjust for: Loss on damaged assets and other hurricane related charges

 

666

 

666

 

0.04

 

Tax effect

 

 

 

 

Non-GAAP

 

$

51,452

 

$

19,348

 

$

1.20

 

 

For the Nine Months Ended September 30, 2017 is as follows:

 

 

 

Operating Income (Loss)

 

Net Income (Loss)
Attributable to ATN
Stockholders

 

Net Income (Loss) per
share Attributable to ATN
Stockholders

 

 

 

 

 

 

 

 

 

GAAP - As reported

 

$

13,998

 

$

(12,016

)

$

(0.74

)

Adjust for: Loss on damaged assets and other hurricane related charges

 

36,566

 

36,566

 

2.26

 

Tax effect

 

 

69

 

0.00

 

Non-GAAP

 

$

50,564

 

$

24,619

 

$

1.52

 

 

15


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