UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
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| Item 2.02 | Results of Operations and Financial Condition. |
On October 28, 2020, ATN International, Inc. (the “Company”) issued a press release announcing financial results for the three and nine months ended September 30, 2020. A copy of the press release is furnished herewith as Exhibit 99.1.
Exhibit 99.1 is furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits |
| 99.1 | Press Release of the Company, dated October 28, 2020 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ATN INTERNATIONAL, INC. | ||
| By: | /s/ Justin D. Benincasa | |
| Justin D. Benincasa | ||
| Chief Financial Officer | ||
| Dated October 28, 2020 | ||
3
Exhibit 99.1
News Release
| For Immediate Release | Contact: | 978-619-1300 | ||
| Wednesday October 28, 2020 | Michael T. Prior | |||
| Chairman and | ||||
| Chief Executive Officer | ||||
| Justin D. Benincasa | ||||
| Chief Financial Officer |
ATN Reports
Third Quarter 2020 Results
| · | Results Demonstrate Resilience and Discipline of Company’s Operations | |
| · | International Telecom Posted Strong Growth in Operating Income and Cash Flow | |
| · | US Telecom Delivers Initial FirstNet Sites and Steady Sequential Results |
Beverly, MA (October 28, 2020) -- ATN International, Inc. (Nasdaq: ATNI) today reported results for the third quarter ended September 30, 2020.
Business Review and Outlook
Commenting on results, Michael Prior, Chief Executive Officer said, “In a time when connectivity and communications are essential, our telecom services operations demonstrated resilience and the benefits of our focus on operational efficiencies and reliability.
“Our International Telecom segment posted another quarter of improved profitability driven by a modest revenue increase and significant cost reductions achieved in several markets. Although some of our markets have been impacted by on-going pandemic-related travel restrictions, we continued to experience strong demand for our data services. This includes high speed internet to the home, an area in which our ongoing network investments have made us a leading high-quality service provider in all of our markets. Also, we were pleased to see a sequential increase in demand for our mobile services, reflecting the benefits of several ongoing sales and marketing initiatives. Our year-on-year EBITDA growth and lower capital expenditures in the segment provides us with substantial cash flow to invest in growth and other opportunities.
“US Telecom results have remained consistent over the last four quarters, however, year-on-year comparisons in this quarter are negatively affected by the previously-discussed treatment of restructured contracts which eliminated seasonality in our revenue reporting this year. After initial pandemic-related construction delays, we completed the first few sites of our FirstNet build-out and expect to complete approximately 25% of the sites by the end of this year. Also, we continue to build out broadband services in under-served rural areas of the country under various programs and initiatives. Our team did excellent work in connection with the FCC’s CBRS auction, which concluded last month with an investment of approximately $20.4 million.
“In summary, we are pleased with how well our operations have performed under challenging conditions, particularly in our international markets, where we have built a portfolio of high value, quality assets by investing in our networks and in management teams that continue to improve margins and quality of service. We are focused on using the cash flow from these operations and our substantial balance sheet capacity to invest in initiatives and programs that we believe have good prospects for growth and attractive risk-adjusted returns,” Mr. Prior concluded.
Third Quarter Results
Third quarter 2020 consolidated revenues of $111.7 million were down 3% compared to the prior year quarter’s revenue of $115.6 million. Operating income for the quarter was $9.6 million, down compared with the prior year quarter’s $10.2 million. EBITDA1 was $31.1 million in the third quarter, down by 5% compared to $32.9 million in the prior year period. Net income attributable to ATN’s stockholders for the third quarter was $2.7 million, or $0.17 per diluted share, compared with the prior year period’s net income of $1.4 million, or $0.09 per diluted share.
Third Quarter 2020 Operating Highlights
The Company has three reportable segments: (i) International Telecom; (ii) US Telecom; and (iii) Renewable Energy.
| Segment Results (in Thousands) | ||||||||||||||||||||
| Three Months Ended September 30, 2020 | ||||||||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other | Total | ||||||||||||||||
| Revenue | $ | 82,465 | $ | 28,097 | $ | 1,177 | $ | — | $ | 111,739 | ||||||||||
| Operating Income (loss) | $ | 16,024 | $ | 2,218 | $ | (98 | ) | $ | (8,587 | ) | $ | 9,557 | ||||||||
| EBITDA1 | $ | 29,695 | $ | 7,947 | $ | 393 | $ | (6,898 | ) | $ | 31,137 | |||||||||
| Capital Expenditures | $ | 8,509 | $ | 8,371 | $ | 482 | $ | 1,334 | $ | 18,696 | ||||||||||
| Nine Months Ended September 30, 2020 | ||||||||||||||||||||
| Revenue | $ | 244,813 | $ | 83,557 | $ | 3,373 | $ | — | $ | 331,743 | ||||||||||
| Operating Income (loss) | $ | 44,119 | $ | 6,241 | $ | (1,175 | ) | $ | (25,306 | ) | $ | 23,879 | ||||||||
| EBITDA1 | $ | 86,239 | $ | 23,572 | $ | 415 | $ | (20,258 | ) | $ | 89,968 | |||||||||
| Capital Expenditures | $ | 28,439 | $ | 17,254 | $ | 2,116 | $ | 2,853 | $ | 50,662 | ||||||||||
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
2
| Segment Results (in Thousands) | ||||||||||||||||||||
| Three Months Ended September 30, 2019 | ||||||||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other | Total | ||||||||||||||||
| Revenue | $ | 81,285 | $ | 32,893 | $ | 1,438 | $ | — | $ | 115,616 | ||||||||||
| Operating Income (loss) | $ | 10,867 | $ | 7,912 | $ | (714 | ) | $ | (7,817 | ) | $ | 10,248 | ||||||||
| EBITDA1 | $ | 24,956 | $ | 13,682 | $ | 302 | $ | (6,089 | ) | $ | 32,851 | |||||||||
| Capital Expenditures | $ | 9,467 | $ | 2,165 | $ | 1,366 | $ | 1,093 | $ | 14,091 | ||||||||||
| Nine Months Ended September 30, 2019 | ||||||||||||||||||||
| Revenue | $ | 241,461 | $ | 80,800 | $ | 4,376 | $ | — | $ | 326,637 | ||||||||||
| Operating Income (loss) | $ | 35,802 | $ | 5,927 | $ | (750 | ) | $ | (25,862 | ) | $ | 15,117 | ||||||||
| EBITDA1 | $ | 76,511 | $ | 22,846 | $ | 1,519 | $ | (20,889 | ) | $ | 79,987 | |||||||||
| Capital Expenditures | $ | 33,159 | $ | 8,533 | $ | 2,183 | $ | 5,611 | $ | 49,486 | ||||||||||
Beginning in the first quarter of 2020 the Company restructured its presentation of revenue in the Condensed Consolidated Statement of Operations and in the Selected Segment Financial Information tables. This change is intended to better align our reporting of financial performance with views of the Company management and industry competitors, and to facilitate discussions with investors and analysts.
International Telecom
International Telecom revenues are generated by delivery of a broad range of communications services, including data, voice and video services from our fixed and mobile network operations in Bermuda and the Caribbean. International Telecom revenues were $82.5 million for the quarter, a 1% increase year-on-year mainly due to increases in fixed broadband revenues partially offset by lower carrier services revenues related to lower roaming traffic due to travel restrictions. Compared to the prior year quarter, operating income increased 47% to $16.0 million and EBITDA1 increased 19% to $29.7 million, respectively, primarily from lower operating costs in the quarter. In October 2020, we completed a transaction to increase our equity ownership in One Communications, the Company’s Bermuda and Cayman based subsidiary, through the purchase of an additional approximately 10% stake, which is expected to be accretive to overall Company earnings beginning in the fourth quarter of 2020. Since the 2016 merger of our Bermuda-based mobile operations with KeyTech to create One Communications, we have increased our equity ownership position from 50% to approximately 70%.
US Telecom
US Telecom revenues consist mainly of carrier services revenues and fixed and mobile retail revenues from our networks and operations in the western United States, as well as communications services provided to enterprise customers. US Telecom segment revenues were $28.1 million in the quarter, a decrease of 15% from the prior year period primarily due to the accounting impact of restructured carrier contracts, which eliminated the seasonal revenue accounting of the previous agreements. The network build portion of the FirstNet agreement has continued during the pandemic and the first few sites were completed and activated during the third quarter. Although the overall timing of the build schedule has been delayed as a result of the impact of pandemic-related restrictions, we expect construction revenues to be generated through 2021. As revenues from the build will be largely offset by construction costs, we do not expect a material impact on operating income or EBITDA1 from this delay. Operating income and EBITDA1 for this segment of $2.2 million and $7.9 million, respectively, each decreased by $5.7 million from the prior year’s quarter mostly as a result of the revenue impact of restructured carrier contracts.
Renewable Energy
Renewable Energy segment revenues are principally the result of the generation and sale of electric power generated by our commercial solar projects in India. We ended the third quarter of 2020 with 52 megawatts (MWs) of revenue generating solar facilities and expect to begin generating revenue from additional MWs later in the year. The current quarter’s operating loss and EBITDA1 of $0.1 million and $0.4 million, respectively, each improved compared with the prior year’s quarter due to lower operating expenses.
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
3
Balance Sheet and Cash Flow Highlights
Total cash, cash equivalents and restricted cash at September 30, 2020 was $136.2 million. Net cash provided by operating activities was $71.6 million for the nine months ended September 30, 2020, compared with $56.8 million for the prior year period. The increase in operating cash flow compared with the prior year is mostly the result of increased net income and lower tax payments over last year, partially offset by a current year increase in cash used for working capital. For the nine months ended September 30, 2020, the Company used net cash of $97.6 million for investing and financing activities compared to $83.4 million for the prior year period. In the current year, the net use of cash was most significantly comprised of $50.7 million in capital expenditures, $20.4 million in purchases of FCC spectrum, $8.8 million of repurchases of non-controlling interests, $8.3 million of ATN share repurchases, $8.2 million of dividends on common stock and $6.5 million in minority partner distributions.
Conference Call Information
ATN will host a conference call on Thursday, October 29, 2020 at 11:00 a.m. Eastern Time (ET) to discuss its third quarter results and business outlook. 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 6472418. A replay of the call will be available at ir.atni.com beginning at approximately 2:00 p.m. (ET) on October 29, 2020.
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.
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
4
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, including the impact of the novel coronavirus pandemic on the economies of the markets we serve, our business and operations; expectations regarding future revenue, operating income, EBITDA and capital expenditures; the competitive environment in our key markets, demand for our services and industry trends; our liquidity; 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 indicated in these statements as a result of many factors, including, among others, (1) 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; (2) our ability to maintain favorable roaming arrangements, receive roaming traffic and satisfy the needs and demands of our major wireless customers; (3) our ability to efficiently and cost-effectively upgrade our networks and IT platforms to address rapid and significant technological changes in the telecommunications industry; (4) government regulation of our businesses, which may impact our FCC and other telecommunications licenses or our renewables businesses; (5) our reliance on a limited number of key suppliers and vendors for timely supply of equipment and services relating to our network infrastructure; (6) economic, political and other risks and opportunities facing our operations, including those resulting from the pandemic; (7) the loss of or an inability to recruit skilled personnel in our various jurisdictions, including key members of management; (8) our ability to expand and obtain funding for our renewable energy business; (9) our ability to find investment or acquisition or disposition opportunities that fit the strategic goals of the Company; (10) the occurrence of weather events and natural catastrophes; (11) increased competition; (12) the adequacy and expansion capabilities of our network capacity and customer service system to support our customer growth; (13) our continued access to capital and credit markets; and (14) the risk of currency fluctuation for those markets in which we operate. 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, 2019, filed with the SEC on March 2, 2020, as amended by Amendment No. 1 to the Annual Report on Form 10-K filed with the SEC on April 29, 2020, 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, except as required by law.
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 included EBITDA in this release and in the tables included herein.
EBITDA is defined as operating income (loss) before depreciation and amortization expense. The Company believes that the inclusion of this non-GAAP financial measure 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 this non-GAAP measure, 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 measure included in this press release is not meant to be considered superior to or a substitute for results of operations prepared in accordance with GAAP. Reconciliations of this non-GAAP financial measure to the most directly comparable GAAP financial measure are set forth in the text of, and the accompanying tables to, this press release. While our non-GAAP financial measure is 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 this financial measure to the comparable GAAP financial measure included below, and not to rely on any single financial measure to evaluate our business.
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
5
Table 1
ATN International, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in Thousands)
| September 30, | December 31, | |||||||
| 2020 | 2019 | |||||||
| Assets: | ||||||||
| Cash and cash equivalents | $ | 135,153 | $ | 161,287 | ||||
| Restricted cash | 1,072 | 1,071 | ||||||
| Short-term investments | 403 | 416 | ||||||
| Other current assets | 88,956 | 65,949 | ||||||
| Total current assets | 225,584 | 228,723 | ||||||
| Property, plant and equipment, net | 589,428 | 605,581 | ||||||
| Operating lease right-of-use assets | 64,294 | 68,763 | ||||||
| Goodwill and other intangible assets, net | 181,040 | 161,818 | ||||||
| Other assets | 53,068 | 65,841 | ||||||
| Total assets | $ | 1,113,414 | $ | 1,130,726 | ||||
| Liabilities and Stockholders’ Equity: | ||||||||
| Current portion of long-term debt | $ | 3,750 | $ | 3,750 | ||||
| Taxes payable | 7,921 | 8,517 | ||||||
| Current portion of lease liabilities | 10,902 | 11,406 | ||||||
| Other current liabilities | 110,289 | 95,996 | ||||||
| Total current liabilities | 132,862 | 119,669 | ||||||
| Long-term debt, net of current portion | $ | 79,973 | $ | 82,676 | ||||
| Deferred income taxes | 2,602 | 8,680 | ||||||
| Lease liabilities | 53,543 | 56,164 | ||||||
| Other long-term liabilities | 49,836 | 57,454 | ||||||
| Total liabilities | 318,816 | 324,643 | ||||||
| Total ATN International, Inc.’s stockholders’ equity | 667,875 | 676,122 | ||||||
| Non-controlling interests | 126,723 | 129,961 | ||||||
| Total equity | 794,598 | 806,083 | ||||||
| Total liabilities and stockholders’ equity | $ | 1,113,414 | $ | 1,130,726 | ||||
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
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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, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Revenues: | ||||||||||||||||
| Communications services | $ | 108,721 | $ | 112,840 | $ | 322,865 | $ | 318,473 | ||||||||
| Other | 3,018 | 2,776 | 8,878 | 8,164 | ||||||||||||
| Total revenue | 111,739 | 115,616 | 331,743 | 326,637 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Termination and access fees | 26,979 | 27,622 | 83,562 | 83,440 | ||||||||||||
| Construction costs | 390 | - | 390 | - | ||||||||||||
| Engineering and operations | 18,127 | 20,095 | 53,983 | 58,234 | ||||||||||||
| Sales, marketing and customer service | 9,344 | 9,785 | 28,220 | 29,048 | ||||||||||||
| General and administrative | 25,735 | 25,110 | 75,413 | 75,518 | ||||||||||||
| Transaction-related charges | 31 | 21 | 147 | 89 | ||||||||||||
| Depreciation and amortization | 21,580 | 22,603 | 66,089 | 64,870 | ||||||||||||
| (Gain) loss on disposition of assets | (4 | ) | 132 | 60 | 321 | |||||||||||
| Total operating expenses | 102,182 | 105,368 | 307,864 | 311,520 | ||||||||||||
| Operating income | 9,557 | 10,248 | 23,879 | 15,117 | ||||||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense, net | (1,243 | ) | (884 | ) | (3,664 | ) | (1,983 | ) | ||||||||
| Other income (expense) | (2,031 | ) | (2,686 | ) | (4,341 | ) | (2,755 | ) | ||||||||
| Other income (expense), net | (3,274 | ) | (3,570 | ) | (8,005 | ) | (4,738 | ) | ||||||||
| Income before income taxes | 6,283 | 6,678 | 15,874 | 10,379 | ||||||||||||
| Income tax (benefit) expense | 92 | 1,834 | (1,057 | ) | 2,774 | |||||||||||
| Net Income | 6,191 | 4,844 | 16,931 | 7,605 | ||||||||||||
| Net income attributable to non-controlling interests, net | (3,530 | ) | (3,459 | ) | (10,538 | ) | (8,657 | ) | ||||||||
| Net income (loss) attributable to ATN International, Inc. stockholders | $ | 2,661 | $ | 1,385 | $ | 6,393 | $ | (1,052 | ) | |||||||
| Net income (loss) per weighted average share attributable to ATN International, Inc. stockholders: | ||||||||||||||||
| Basic Net Income (Loss) | $ | 0.17 | $ | 0.09 | $ | 0.40 | $ | (0.07 | ) | |||||||
| Diluted Net Income (Loss) | $ | 0.17 | $ | 0.09 | $ | 0.40 | $ | (0.07 | ) | |||||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 15,962 | 16,000 | 15,946 | 15,984 | ||||||||||||
| Diluted | 16,011 | 16,007 | 15,991 | 15,984 | ||||||||||||
Note: The Company has restructured its presentation of revenues - see Table 4
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
7
Table 3
ATN International, Inc.
Unaudited Condensed Consolidated Cash Flow Statement
(in Thousands)
| Nine Months Ended September 30, | ||||||||
| 2020 | 2019 | |||||||
| Net income | $ | 16,931 | $ | 7,605 | ||||
| Depreciation and amortization | 66,089 | 64,870 | ||||||
| Provision for doubtful accounts | 4,452 | 3,796 | ||||||
| (Gain) Loss on disposition of assets | 60 | 321 | ||||||
| Stock-based compensation | 4,608 | 4,881 | ||||||
| Deferred income taxes | (6,078 | ) | (6,287 | ) | ||||
| Loss on investments | 3,360 | 2,131 | ||||||
| Change in prepaid and accrued income taxes | 620 | (13,889 | ) | |||||
| Change in other operating assets and liabilities | (19,295 | ) | (7,262 | ) | ||||
| Other non-cash activity | 844 | 681 | ||||||
| Net cash provided by operating activities | 71,591 | 56,847 | ||||||
| Capital expenditures | (50,662 | ) | (49,486 | ) | ||||
| Purchases of intangible assets, including deposits | (20,396 | ) | - | |||||
| Purchases of strategic investments | (2,768 | ) | (10,285 | ) | ||||
| Purchase of short-term investments | (116 | ) | (8,028 | ) | ||||
| Sale of strategic investments | 11,969 | - | ||||||
| Sale of short-term investments | - | 5,141 | ||||||
| Net cash used in investing activities | (61,973 | ) | (62,658 | ) | ||||
| Dividends paid on common stock | (8,166 | ) | (8,160 | ) | ||||
| Distributions to non-controlling interests | (6,503 | ) | (5,760 | ) | ||||
| Principal repayments of term loan | (2,814 | ) | (2,825 | ) | ||||
| Payment of debt issuance costs | (1,096 | ) | (1,340 | ) | ||||
| Stock-based compensation share repurchases | (1,733 | ) | (1,607 | ) | ||||
| Purchases of common stock - share buyback | (6,589 | ) | (162 | ) | ||||
| Repurchases of non-controlling interests | (8,763 | ) | (1,353 | ) | ||||
| Investments made by minority shareholders | - | 488 | ||||||
| Net cash used in financing activities | (35,664 | ) | (20,719 | ) | ||||
| Effect of foreign currency exchange rates on total cash, cash equivalents and restricted cash | (87 | ) | (26 | ) | ||||
| Net change in total cash, cash equivalents and restricted cash | (26,133 | ) | (26,556 | ) | ||||
| Total cash, cash equivalents and restricted cash, beginning of period | 162,358 | 192,907 | ||||||
| Total cash, cash equivalents and restricted cash, end of period | $ | 136,225 | $ | 166,351 | ||||
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
8
Table 4
ATN International, Inc.
Selected Segment Financial Information
(In Thousands)
For the three months ended September 30, 2020 is as follows:
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Statement of Operations Data: | ||||||||||||||||||||
| Revenue** | ||||||||||||||||||||
| Mobility | $ | 21,406 | $ | 2,432 | $ | - | $ | - | $ | 23,838 | ||||||||||
| Fixed | 57,364 | 5,419 | - | - | 62,783 | |||||||||||||||
| Carrier services | 1,851 | 19,852 | - | - | 21,703 | |||||||||||||||
| Other | 397 | - | - | - | 397 | |||||||||||||||
| Total communications services | $ | 81,018 | $ | 27,703 | $ | - | $ | - | $ | 108,721 | ||||||||||
| Renewable Energy | $ | - | $ | - | $ | 1,177 | $ | - | $ | 1,177 | ||||||||||
| Managed Services | 1,447 | - | - | - | 1,447 | |||||||||||||||
| Construction | - | 394 | - | - | 394 | |||||||||||||||
| Total Other | $ | 1,447 | $ | 394 | $ | 1,177 | $ | - | $ | 3,018 | ||||||||||
| Total Revenue | $ | 82,465 | $ | 28,097 | $ | 1,177 | $ | - | $ | 111,739 | ||||||||||
| Operating Income (Loss) | $ | 16,024 | $ | 2,218 | $ | (98 | ) | $ | (8,587 | ) | $ | 9,557 | ||||||||
| Stock-based compensation | 29 | - | 66 | 1,792 | 1,887 | |||||||||||||||
| Non-controlling interest ( net income or (loss) ) | $ | (2,762 | ) | $ | (786 | ) | $ | 18 | $ | - | $ | (3,530 | ) | |||||||
| Non GAAP measures: | ||||||||||||||||||||
| EBITDA (1) | $ | 29,695 | $ | 7,947 | $ | 393 | $ | (6,898 | ) | $ | 31,137 | |||||||||
| Adjusted EBITDA (2) | $ | 29,695 | $ | 7,943 | $ | 393 | $ | (6,867 | ) | $ | 31,164 | |||||||||
| Balance Sheet Data (at September 30, 2020): | ||||||||||||||||||||
| Cash, cash equivalents and investments | $ | 67,701 | $ | 25,177 | $ | 22,376 | $ | 20,302 | $ | 135,556 | ||||||||||
| Total current assets | 124,515 | 59,801 | 25,290 | 15,978 | 225,584 | |||||||||||||||
| Fixed assets, net | 452,303 | 77,017 | 45,773 | 14,335 | 589,428 | |||||||||||||||
| Total assets | 664,307 | 233,288 | 71,757 | 144,062 | 1,113,414 | |||||||||||||||
| Total current liabilities | 71,254 | 36,898 | 909 | 23,801 | 132,862 | |||||||||||||||
| Total debt | 83,723 | - | - | - | 83,723 | |||||||||||||||
| * | Corporate and Other refer to corporate overhead expenses and consolidating adjustments |
| ** | The Company restructured its presentation of revenue to better align financial reporting with industry competitors, and the view of investors and company management. |
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
9
ATN International, Inc.
Selected Segment Financial Information
(In Thousands)
For the three months ended September 30, 2019 is as follows:
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Statement of Operations Data: | ||||||||||||||||||||
| Revenue** | ||||||||||||||||||||
| Mobility | $ | 21,364 | $ | 2,601 | $ | - | $ | - | $ | 23,965 | ||||||||||
| Fixed | 55,845 | 4,304 | - | - | 60,149 | |||||||||||||||
| Carrier services | 2,403 | 25,988 | - | - | 28,391 | |||||||||||||||
| Other | 335 | - | - | - | 335 | |||||||||||||||
| Total communications services | $ | 79,947 | $ | 32,893 | $ | - | $ | - | $ | 112,840 | ||||||||||
| Renewable Energy | $ | - | $ | - | $ | 1,438 | $ | - | $ | 1,438 | ||||||||||
| Managed Services | 1,338 | - | - | - | 1,338 | |||||||||||||||
| Total Other | $ | 1,338 | $ | - | $ | 1,438 | $ | - | $ | 2,776 | ||||||||||
| Total Revenue | $ | 81,285 | $ | 32,893 | $ | 1,438 | $ | - | $ | 115,616 | ||||||||||
| Operating Income (Loss) | $ | 10,867 | $ | 7,912 | $ | (714 | ) | $ | (7,817 | ) | $ | 10,248 | ||||||||
| Stock-based compensation | 285 | - | - | 1,263 | 1,548 | |||||||||||||||
| Non-controlling interest ( net income or (loss) ) | $ | (2,154 | ) | $ | (1,342 | ) | $ | 37 | $ | - | $ | (3,459 | ) | |||||||
| Non GAAP measures: | ||||||||||||||||||||
| EBITDA (1) | $ | 24,956 | $ | 13,682 | $ | 302 | $ | (6,089 | ) | $ | 32,851 | |||||||||
| Adjusted EBITDA (2) | $ | 24,956 | $ | 13,779 | $ | 337 | $ | (6,068 | ) | $ | 33,004 | |||||||||
| * | Corporate and Other refer to corporate overhead expenses and consolidating adjustments |
| ** | The Company restructured its presentation of revenue to better align financial reporting with industry competitors, and the view of investors and company management. |
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
10
ATN International, Inc.
Selected Segment Financial Information
(In Thousands)
For the nine months ended September 30, 2020 is as follows:
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Statement of Operations Data: | ||||||||||||||||||||
| Revenue** | ||||||||||||||||||||
| Mobility | $ | 60,604 | $ | 7,203 | $ | - | $ | - | $ | 67,807 | ||||||||||
| Fixed | 172,420 | 15,181 | - | - | 187,601 | |||||||||||||||
| Carrier services | 5,392 | 60,779 | - | - | 66,171 | |||||||||||||||
| Other | 1,286 | - | - | - | 1,286 | |||||||||||||||
| Total communications services | $ | 239,702 | $ | 83,163 | $ | - | $ | - | $ | 322,865 | ||||||||||
| Renewable Energy | $ | - | $ | - | $ | 3,374 | $ | - | $ | 3,374 | ||||||||||
| Managed Services | 5,110 | - | - | - | 5,110 | |||||||||||||||
| Construction | - | 394 | - | - | 394 | |||||||||||||||
| Total Other | $ | 5,110 | $ | 394 | $ | 3,374 | $ | - | $ | 8,878 | ||||||||||
| Total Revenue | $ | 244,812 | $ | 83,557 | $ | 3,374 | $ | - | $ | 331,743 | ||||||||||
| Operating Income (Loss) | $ | 44,119 | $ | 6,241 | $ | (1,175 | ) | $ | (25,306 | ) | $ | 23,879 | ||||||||
| Stock-based compensation | 20 | - | 197 | 4,391 | 4,608 | |||||||||||||||
| Non-controlling interest ( net income or (loss) ) | $ | (7,770 | ) | $ | (2,880 | ) | $ | 112 | $ | - | $ | (10,538 | ) | |||||||
| Non GAAP measures: | ||||||||||||||||||||
| EBITDA (1) | $ | 86,239 | $ | 23,572 | $ | 415 | $ | (20,258 | ) | $ | 89,968 | |||||||||
| Adjusted EBITDA (2) | $ | 86,252 | $ | 23,573 | $ | 545 | $ | (20,195 | ) | $ | 90,175 | |||||||||
| * | Corporate and Other refer to corporate overhead expenses and consolidating adjustments |
| ** | The Company restructured its presentation of revenue to better align financial reporting with industry competitors, and the view of investors and company management. |
ATN International, Inc.
Selected Segment Financial Information
(In Thousands)
For the nine months ended September 30, 2019 is as follows:
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Statement of Operations Data: | ||||||||||||||||||||
| Revenue** | ||||||||||||||||||||
| Mobility | $ | 62,766 | $ | 8,095 | $ | - | $ | - | $ | 70,861 | ||||||||||
| Fixed | 166,925 | 9,885 | - | - | 176,810 | |||||||||||||||
| Carrier services | 6,970 | 62,820 | - | - | 69,790 | |||||||||||||||
| Other | 1,012 | - | - | - | 1,012 | |||||||||||||||
| Total communications services | $ | 237,673 | $ | 80,800 | $ | - | $ | - | $ | 318,473 | ||||||||||
| Renewable Energy | $ | - | $ | - | $ | 4,376 | $ | - | $ | 4,376 | ||||||||||
| Managed Services | 3,788 | - | - | - | 3,788 | |||||||||||||||
| Total Other | $ | 3,788 | $ | - | $ | 4,376 | $ | - | $ | 8,164 | ||||||||||
| Total Revenue | $ | 241,461 | $ | 80,800 | $ | 4,376 | $ | - | $ | 326,637 | ||||||||||
| Operating Income (Loss) | $ | 35,802 | $ | 5,927 | $ | (750 | ) | $ | (25,862 | ) | $ | 15,117 | ||||||||
| Stock-based compensation | 306 | - | - | 4,575 | 4,881 | |||||||||||||||
| Non-controlling interest ( net income or (loss) ) | $ | (6,810 | ) | $ | (1,864 | ) | $ | 17 | $ | - | $ | (8,657 | ) | |||||||
| Non GAAP measures: | ||||||||||||||||||||
| EBITDA (1) | $ | 76,511 | $ | 22,846 | $ | 1,519 | $ | (20,889 | ) | $ | 79,987 | |||||||||
| Adjusted EBITDA (2) | $ | 76,497 | $ | 23,007 | $ | 1,693 | $ | (20,800 | ) | $ | 80,397 | |||||||||
| * | Corporate and Other refer to corporate overhead expenses and consolidating adjustments |
| ** | The Company restructured its presentation of revenue to better align financial reporting with industry competitors, and the view of investors and company management. |
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
11
ATN International, Inc.
Selected Segment Financial Information
(In Thousands)
at December 31, 2019
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Balance Sheet Data (at December 31, 2019): | ||||||||||||||||||||
| Cash, cash equivalents and investments | $ | 43,125 | $ | 38,240 | $ | 25,054 | $ | 55,284 | $ | 161,703 | ||||||||||
| Total current assets | 91,497 | 54,207 | 27,534 | 55,484 | 228,723 | |||||||||||||||
| Fixed assets, net | 466,523 | 69,184 | 48,421 | 21,452 | 605,581 | |||||||||||||||
| Total assets | 647,228 | 222,356 | 76,723 | 184,419 | 1,130,726 | |||||||||||||||
| Total current liabilities | 77,644 | 24,905 | 2,745 | 14,374 | 119,669 | |||||||||||||||
| Total debt | 86,426 | - | - | - | 86,426 | |||||||||||||||
(1) See Table 5 for reconciliation of Operating Income to EBITDA
(2) See Table 5 for reconciliation of Operating Income to Adjusted EBITDA
| * | Corporate and Other refer to corporate overhead expenses and consolidating adjustments |
ATN International, Inc.
Selected Segment Financial Information
(In Thousands)
at September 30, 2020
| Quarter ended | ||||||||||||||||||||
| September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||
| 2019 | 2019 | 2020 | 2020 | 2020 | ||||||||||||||||
| International Telecom Operational Data: | ||||||||||||||||||||
| Mobile - Subscribers * | 285,000 | 284,100 | 282,100 | 276,400 | 289,100 | |||||||||||||||
| Fixed - Data Subscribers * | 124,700 | 127,500 | 131,300 | 135,500 | 137,500 | |||||||||||||||
| Fixed - Video Subscribers * | 38,900 | 38,400 | 38,100 | 36,400 | 35,800 | |||||||||||||||
| Fixed - Voice | 164,900 | 164,800 | 166,700 | 167,100 | 167,900 | |||||||||||||||
| * | Counts were adjusted for all periods presented based upon a change in methodology and process |
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
12
| Table 5 | ||||||
| ATN International, Inc. | ||||||
| Reconciliation of Non-GAAP Measures | ||||||
| (In Thousands) | ||||||
| For the three months ended September 30, 2020 is as follows: | ||||||||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Operating income (loss) | $ | 16,024 | $ | 2,218 | $ | (98 | ) | $ | (8,587 | ) | $ | 9,557 | ||||||||
| Depreciation and amortization expense | 13,671 | 5,729 | 491 | 1,689 | 21,580 | |||||||||||||||
| EBITDA | $ | 29,695 | $ | 7,947 | $ | 393 | $ | (6,898 | ) | 31,137 | ||||||||||
| Transaction-related charges | - | - | - | 31 | 31 | |||||||||||||||
| (Gain) Loss on disposition of assets | - | (4 | ) | - | - | (4 | ) | |||||||||||||
| ADJUSTED EBITDA | $ | 29,695 | $ | 7,943 | $ | 393 | $ | (6,867 | ) | 31,164 | ||||||||||
| Revenue | 82,465 | 28,097 | 1,177 | - | 111,739 | |||||||||||||||
| ADJUSTED EBITDA MARGIN | 36.0 | % | 28.3 | % | 33.4 | % | NA | 27.9 | % | |||||||||||
| For the three months ended September 30, 2019 is as follows: | ||||||||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Operating income (loss) | $ | 10,867 | $ | 7,912 | $ | (714 | ) | $ | (7,817 | ) | $ | 10,248 | ||||||||
| Depreciation and amortization expense | 14,089 | 5,770 | 1,016 | 1,728 | 22,603 | |||||||||||||||
| EBITDA | $ | 24,956 | $ | 13,682 | $ | 302 | $ | (6,089 | ) | 32,851 | ||||||||||
| Transaction-related charges | - | - | - | 21 | 21 | |||||||||||||||
| (Gain) Loss on disposition of assets | - | 97 | 35 | - | 132 | |||||||||||||||
| ADJUSTED EBITDA | $ | 24,956 | $ | 13,779 | $ | 337 | $ | (6,068 | ) | 33,004 | ||||||||||
| Revenue | 81,285 | 32,893 | 1,438 | - | 115,616 | |||||||||||||||
| ADJUSTED EBITDA MARGIN | 30.7 | % | 41.9 | % | 23.4 | % | NA | 28.5 | % | |||||||||||
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
13
ATN International, Inc.
Reconciliation of Non-GAAP Measures
(In Thousands)
| For the nine months ended September 30, 2020 is as follows: | ||||||||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Operating income (loss) | $ | 44,119 | $ | 6,241 | $ | (1,175 | ) | $ | (25,306 | ) | $ | 23,879 | ||||||||
| Depreciation and amortization expense | 42,120 | 17,331 | 1,590 | 5,048 | 66,089 | |||||||||||||||
| EBITDA | $ | 86,239 | $ | 23,572 | $ | 415 | $ | (20,258 | ) | 89,968 | ||||||||||
| Transaction-related charges | - | - | 84 | 63 | 147 | |||||||||||||||
| (Gain) Loss on disposition of assets | 13 | 1 | 46 | - | 60 | |||||||||||||||
| ADJUSTED EBITDA | $ | 86,252 | $ | 23,573 | $ | 545 | $ | (20,195 | ) | 90,175 | ||||||||||
| Revenue | 244,812 | 83,557 | 3,374 | - | 331,743 | |||||||||||||||
| ADJUSTED EBITDA MARGIN | 35.2 | % | 28.2 | % | 16.2 | % | NA | 27.2 | % | |||||||||||
| For the nine months ended September 30, 2019 is as follows: | ||||||||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | ||||||||||||||||
| Operating income (loss) | $ | 35,802 | $ | 5,927 | $ | (750 | ) | $ | (25,862 | ) | $ | 15,117 | ||||||||
| Depreciation and amortization expense | 40,709 | 16,919 | 2,269 | 4,973 | 64,870 | |||||||||||||||
| EBITDA | $ | 76,511 | $ | 22,846 | $ | 1,519 | $ | (20,889 | ) | 79,987 | ||||||||||
| Transaction-related charges | - | - | - | 89 | 89 | |||||||||||||||
| (Gain) Loss on disposition of assets | (14 | ) | 161 | 174 | - | 321 | ||||||||||||||
| ADJUSTED EBITDA | $ | 76,497 | $ | 23,007 | $ | 1,693 | $ | (20,800 | ) | 80,397 | ||||||||||
| Revenue | 241,461 | 80,800 | 4,376 | - | 326,637 | |||||||||||||||
| ADJUSTED EBITDA MARGIN | 31.7 | % | 28.5 | % | 38.7 | % | NA | 24.6 | % | |||||||||||
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
14