Alaska Communications Acquisition Drives 49% Year-on-Year Consolidated Revenue Growth
Alaska Communications Performed in Line with Expectations
Expanding Domestic Network Reach to Grow High Speed Data Revenue and Customers
BEVERLY, Mass., Oct. 27, 2021 (GLOBE NEWSWIRE) — ATN International, Inc. (Nasdaq: ATNI) today reported results for the third quarter and nine months ended September 30, 2021.
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Business Review and Outlook
Michael Prior, Chief Executive Officer, commented, “The Alaska Communications acquisition has significantly increased the scale of ATN’s domestic operations and has opened additional opportunities for us to pursue growth initiatives that also provide significant social and economic benefits by bringing high speed connectivity to the communities we serve.
“The addition of approximately ten weeks of Alaska Communications operations was the major driver of a nearly three-fold increase in our US Telecom segment revenues, with fiber-based services to enterprise, government, wholesale and residential customers representing the majority of that growth. Higher FirstNet construction revenues also contributed to the increase. Additionally, we experienced growth in our legacy domestic business in the western U.S. due to higher consumer broadband revenues following our late 2020 build out of rural broadband networks under various government programs and public-private initiatives. ATN now owns and operates approximately 6,000 fiber route miles in the U.S., and with more federal government funding becoming available to help connect rural communities to true high speed data access, we have allocated additional resources to capture opportunities to build-out rural middle mile fiber networks and fiber and fixed wireless connections. This is a priority for the strategic transformation of our legacy domestic wholesale roaming business into a broader fiber-based communications platform, and it is in keeping with our corporate mission of bringing reliable and affordable access to the modern communications infrastructure to historically underbuilt areas.
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“International Telecom revenue increased in the third quarter, reflecting the positive performance of several of our key international markets, where upgrades and expansions of our networks and effective marketing campaigns have resulted in continued subscriber growth. We are pleased with the third quarter and year-to-date revenue performance of this segment and see additional growth opportunities on the horizon. Higher expense levels in part reflected a difficult comparison with the unusually low operating costs we had during the pandemic and increased regulatory costs. While supply chain disruptions have not had a material effect on our business year-to-date, we continue to monitor this potential given its impact on other communications infrastructure and technology companies.
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“Looking ahead, we see opportunities to drive additional revenue growth in both of our business segments. We are continuing to expand our networks and offerings in several of our International Telecom markets where we see the potential to increase penetration and market share. Domestically, in addition to rural network buildouts in the “lower 48”, we continue to upgrade and extend our fiber network in Alaska, adding wholesale, enterprise and residential connections to grow our customer base utilizing that expanded network reach and capability,” Mr. Prior noted.
Third Quarter 2021 Results
Third quarter 2021 consolidated revenues of $166.8 million were up 49% compared to the prior year quarter’s revenue of $111.7 million. The Company closed the acquisition of Alaska Communications in late July, which contributed $46.8 million to third quarter revenues. The third quarter of 2021 had an operating loss of $1.0 million and Adjusted EBITDA 2 of $36.8 million, compared with the prior year quarter’s operating income of $9.6 million and Adjusted EBITDA 2 of $31.2 million. The decrease in operating income was mostly the result of increased transaction-related fees and amortization expenses from the consolidation of Alaska Communications results. The Adjusted EBITDA 2 increase was due to the addition of $10.6 million from Alaska Communications, partially offset by a net decline in the International Telecom segment. The net loss attributable to ATN’s stockholders for the third quarter was $2.6 million, and a $0.22 loss per share, compared with the prior year period’s net income attributable to ATN’s stockholders of $2.7 million, or $0.17 income per diluted share.
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Third Quarter 2021 Operating Highlights
The Company recorded financial results during the third quarter of 2021 in three categories: (i) International Telecom; (ii) US Telecom; and (iii) All Other. For the purposes of the below presentation, the Company’s Renewable Energy segment has been combined with Corporate and Other as “All Other”.
The Company completed its acquisition of Alaska Communications on July 22, 2021, and the consolidated results are included in the Company’s US Telecom segment.
Operating Results (in Thousands)
| Three Months Ended September 30, 2021 | |||||||||||
| International | US | Total | |||||||||
| Telecom | Telecom | All Other* | ATN | ||||||||
| Revenue | $ | 85,306 | $ | 81,454 | $ | 0 | $ | 166,760 | |||
| Operating Income (Loss) | $ | 13,213 | $ | (9,830 | ) | $ | (4,365 | ) | $ | (982 | ) |
| EBITDA1 | $ | 26,940 | $ | 7,559 | $ | (3,126 | ) | $ | 31,373 | ||
| Adjusted EBITDA2 | $ | 26,872 | $ | 16,404 | $ | (6,463 | ) | $ | 36,813 | ||
| Capital Expenditures** | $ | 10,642 | $ | 17,364 | $ | 983 | $ | 28,989 | |||
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| Nine Months Ended September 30, 2021 | |||||||||||
| International | US | Total | |||||||||
| Telecom | Telecom | All Other* | ATN | ||||||||
| Revenue | $ | 255,342 | $ | 159,375 | $ | 418 | $ | 415,135 | |||
| Operating Income (Loss) | $ | 40,999 | $ | (10,920 | ) | $ | (24,808 | ) | $ | 5,271 | |
| EBITDA1 | $ | 82,341 | $ | 16,740 | $ | (20,793 | ) | $ | 78,288 | ||
| Adjusted EBITDA2 | $ | 82,276 | $ | 23,820 | $ | (19,380 | ) | $ | 86,716 | ||
| Capital Expenditures** | $ | 32,485 | $ | 36,157 | $ | 2,280 | $ | 70,922 | |||
| Three Months Ended September 30, 2020 | |||||||||||
| International | US | Total | |||||||||
| Telecom | Telecom | All Other* | ATN | ||||||||
| Revenue | $ | 82,465 | $ | 28,097 | $ | 1,177 | $ | 111,739 | |||
| Operating Income (Loss) | $ | 16,024 | $ | 2,218 | $ | (8,685 | ) | $ | 9,557 | ||
| EBITDA1 | $ | 29,695 | $ | 7,947 | $ | (6,505 | ) | $ | 31,137 | ||
| Adjusted EBITDA2 | $ | 29,695 | $ | 7,943 | $ | (6,474 | ) | $ | 31,164 | ||
| Capital Expenditures** | $ | 8,510 | $ | 8,371 | $ | 1,816 | $ | 18,697 | |||
| Nine Months Ended September 30, 2020 | |||||||||||
| International | US | Total | |||||||||
| Telecom | Telecom | All Other* | ATN | ||||||||
| Revenue | $ | 244,812 | $ | 83,557 | $ | 3,374 | $ | 331,743 | |||
| Operating Income (Loss) | $ | 44,119 | $ | 6,241 | $ | (26,481 | ) | $ | 23,879 | ||
| EBITDA1 | $ | 86,239 | $ | 23,572 | $ | (19,843 | ) | $ | 89,968 | ||
| Adjusted EBITDA2 | $ | 86,252 | $ | 23,573 | $ | (19,650 | ) | $ | 90,175 | ||
| Capital Expenditures** | $ | 28,439 | $ | 17,254 | $ | 4,969 | $ | 50,662 | |||
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*For this table presentation, the Renewable Energy segment and Corporate and Other results were combined. See table 4 for the separate presentation of the financial performance of these items.
**Includes capital expenditures reimbursable from customers of $2,192 and $8,700 for the three and nine months ended September 30, 2021, respectively and $502 and $1,870 for the three and nine months ended September 30, 2020, respectively.
International Telecom
International Telecom revenues are generated by delivery of a broad range of communications and managed IT services, including data, voice and video services from the Company’s fixed and mobile network operations in Bermuda and the Caribbean, and include direct government payments as part of the FCC high-cost support program in the USVI. International Telecom revenues were $85.3 million for the quarter, a 3% increase year-on-year mainly due to subscriber and ARPU growth which drove increases in mobility and fixed revenues in multiple markets, partially offset by the loss of $1.4 million in FCC high-cost support in the USVI. Carrier services revenues also increased as travel and tourism increased in the U.S. Virgin Islands. Operating expenses increased in most of the markets compared with the prior year as operating expenses returned to normalized pre-pandemic levels and due to the introduction of higher regulatory fees in Guyana earlier in 2021. As a result, when compared with the prior year quarter, operating income of $13.2 million and Adjusted EBITDA 2 of $26.9 million decreased by 18% and 10%, respectively, for the third quarter of 2021.
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US Telecom
US Telecom revenues consist of broadband, carrier services, managed IT services, fixed enterprise, and mobile retail revenues from the Company’s networks and operations in Alaska and in the western United States, including various government programs such as CAF II, E-Rate, Lifeline and rural healthcare support programs. US Telecom segment revenues were $81.5 million in the quarter, up $53.4 million from the prior year period. This increase was mostly due to the addition of $46.8 million of revenues from Alaska Communications, as well as $6.0 million of increased construction revenue related to the FirstNet contract build. Adjusted EBITDA 2 for the quarter was $16.4 million compared to the prior year period’s Adjusted EBITDA 2 of $7.9 million. This increase was driven by the addition of the Alaska Communications results of $10.6 million partially offset by approximately $2.0 million of additional expenses in our private network operations. For the segment, the current period’s operating loss was $9.8 million compared to the prior year’s operating income of $2.2 million, primarily due to $8.8 million of transaction-related fees and amortization expense related to the Alaska Communications acquisition and the additional expenses in our private network operations.
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By the end of the third quarter of 2021, the Company had completed and activated approximately 50% of the total sites related to the network build portion of its FirstNet Agreement and expects to complete an additional 15% of the total build by the end of 2021. Revenues from the build will continue to be largely offset by construction costs.
Balance Sheet and Cash Flow Highlights
Total cash, cash equivalents and restricted cash on September 30, 2021 totaled $102.4 million. On July 22, 2021 the Company completed the acquisition of Alaska Communications for approximately $339.5 million. The acquisition was funded through a draw under the Company’s existing revolving credit facility of which $65.0 million is outstanding, an equity contribution from our financial partner and proceeds from Alaska Communications new credit agreement that is non-recourse to the Company. At the end of the quarter, Alaska Communications had outstanding a $210.0 million term loan facility and $10.0 million drawn under its $35.0 million revolving facility.
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Net cash provided by operating activities was $47.7 million for the nine months ended September 30, 2021, compared with $71.6 million for the prior year period. The decline in operating cash flow compared with the prior year is mostly the result of a current year decrease in operating income and a $25.7 million increase in the FirstNet construction customer receivable. For the nine months ended September 30, 2021, the Company used net cash of $50.3 million for investing and financing activities compared to $97.6 million for the prior year period. The net use of cash was primarily attributable to $339.5 million used to purchase Alaska Communications offset by net borrowings of $285.0 million and $71.5 million of partner equity contributions, mentioned above, $70.9 million in capital expenditures, $13.1 million of purchases of minority equity interests in our subsidiaries, $13.0 million in repurchases of Company common stock and dividends to Company stockholders, and $4.8 million in minority partner distributions. These uses of cash were partially offset by $7.1 million in grants received, $18.6 million in net proceeds received from the completion of the Vibrant Energy equity sale and $27.5 million in new borrowings under the FirstNet receivables credit facility.
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Conference Call Information
ATN will host a conference call on Thursday, October 28, 2021 at 10:00 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 7087676. A replay of the call will be available at ir.atni.com beginning at approximately 1:00 p.m. (ET) on Thursday, October 28, 2021.
About ATN
ATN International, Inc. (Nasdaq: ATNI), headquartered in Beverly, Massachusetts, operates communications and technology businesses in the United States and internationally, including the Caribbean region, with a particular focus on markets with a need for growing demand for infrastructure investments and technology improvements. Our operating subsidiaries today primarily provide: (i) advanced wireless and wireline connectivity to residential and business customers, including a range of high-speed internet and data services, fixed and mobile wireless solutions, video and voice services, and (ii) carrier and enterprise communication services, wholesale communications infrastructure services such as terrestrial and submarine fiber optic transport, communications tower facilities, managed mobile networks, and in-building wireless systems. For more information, please visit www.atni.com .
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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, and on our business and operations; expectations regarding future revenues, operating income, EBITDA and capital expenditures; the competitive environment in our key markets, demand for our services and industry trends; our expectations regarding construction progress under our FirstNet agreement and the effect such progress will have on our financial results; our expectations regarding the benefits of our acquisition of Alaska Communications; the impact of federal support program revenues; our liquidity; the organization of our business; 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 retention of and future growth of our subscriber base, including growth in our private networks business; (2) our ability to successfully integrate our newly acquired Alaska Communications business with our own and realize cost synergies and expansion plans; (3) our ability to satisfy the needs and demands of our major wireless customers; (4) our ability to efficiently and cost-effectively upgrade our networks and IT platforms to address rapid and significant technological changes in the telecommunications industry; (5) government regulation of our businesses, which may impact our telecommunications licenses, our revenue and our operating costs; (6) our reliance on a limited number of key suppliers and vendors for timely supply of equipment and services relating to our network infrastructure; (7) economic, political and other risks and opportunities facing our operations, including those resulting from the pandemic; (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) the occurrence of weather events and natural catastrophes and our ability to secure the appropriate level of insurance coverage for these assets; (11) increased competition; (12) the adequacy and expansion capabilities of our network capacity and customer service system to support our customer growth; and (13) our continued access to capital and credit markets. 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, 2020, filed with the SEC on March 1, 2021, those set forth under Item 1A “Risk Factors” of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, filed with the SEC on August 9, 2021 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.
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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, the Company has included EBITDA and Adjusted EBITDA in this release and in the tables included herein.
EBITDA is defined as operating income (loss) before depreciation and amortization expense. The Company has defined Adjusted EBITDA as operating income (loss) before depreciation and amortization expense, transaction-related charges and the gain (loss) on disposition of assets. The Company believes that the inclusion of these non-GAAP financial measures help investors gain a meaningful understanding of the Company’s core operating results and enhances the usefulness of comparing such performance with prior periods. Management uses these non-GAAP measures, in addition to GAAP financial measures, as the basis for measuring the Company’s core operating performance and comparing such performance to that of prior periods. The non-GAAP financial measures included in this 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 to the most directly comparable GAAP financial measures are set forth in the text of, and the accompanying tables to, this press release. While non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating the Company’s own operating results over different periods of time, the Company urges 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 its business.
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| Table 1 | |||||
| ATN International, Inc. | |||||
| Unaudited Condensed Consolidated Balance Sheets | |||||
| (in Thousands) | |||||
| September 30, | December 31, | ||||
| 2021 | 2020 | ||||
| Assets: | |||||
| Cash and cash equivalents | $ | 101,268 | $ | 103,925 | |
| Restricted cash | 1,096 | 1,072 | |||
| Assets held-for-sale | – | 34,735 | |||
| Customer receivable | 3,430 | 1,227 | |||
| Other current assets | 143,911 | 99,106 | |||
| Total current assets | 249,705 | 240,065 | |||
| Property, plant and equipment, net | 915,834 | 536,462 | |||
| Operating lease right-of-use assets | 122,422 | 63,235 | |||
| Customer receivable – long term | 33,096 | 9,614 | |||
| Goodwill and other intangible assets, net | 228,985 | 181,769 | |||
| Other assets | 77,342 | 52,566 | |||
| Total assets | $ | 1,627,384 | $ | 1,083,711 | |
| Liabilities, Mezzanine Equity and Stockholders’ Equity: | |||||
| Current portion of long-term debt | $ | 3,762 | $ | 3,750 | |
| Current portion of customer receivable credit faciity | 3,295 | – | |||
| Taxes payable | 9,350 | 7,501 | |||
| Current portion of lease liabilities | 14,256 | 12,371 | |||
| Liabilities held-for-sale | – | 717 | |||
| Other current liabilities | 172,347 | 123,589 | |||
| Total current liabilities | 203,010 | 147,928 | |||
| Long-term debt, net of current portion | $ | 345,073 | $ | 69,073 | |
| Customer receivable credit facility, net of current portion | 22,486 | – | |||
| Deferred income taxes | 21,776 | 10,675 | |||
| Lease liabilities | 96,031 | 51,082 | |||
| Other long-term liabilities | 135,614 | 50,617 | |||
| Total liabilities | 823,990 | 329,375 | |||
| Mezzanine Equity | 71,820 | – | |||
| Stockholders’ Equity | |||||
| Total ATN International, Inc.’s stockholders’ equity | 629,292 | 645,649 | |||
| Non-controlling interests | 102,282 | 108,687 | |||
| Total stockholders’ equity | 731,574 | 754,336 | |||
| Total liabilities, mezzanine equity and stockholders’ equity | $ | 1,627,384 | $ | 1,083,711 | |
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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, | ||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Revenues: | |||||||||||||||
| Communications services | $ | 155,298 | $ | 108,721 | $ | 378,897 | $ | 322,865 | |||||||
| Other | 11,462 | 3,018 | 36,238 | 8,878 | |||||||||||
| Total revenue | 166,760 | 111,739 | 415,135 | 331,743 | |||||||||||
| Operating expenses (excluding depreciation and amortization unless otherwise indicated): | |||||||||||||||
| Cost of services | 70,732 | 45,106 | 168,717 | 137,545 | |||||||||||
| Cost of construction revenue | 5,855 | 390 | 27,997 | 390 | |||||||||||
| Selling, general and administrative | 53,360 | 35,079 | 131,705 | 103,633 | |||||||||||
| Transaction-related charges | 5,696 | 31 | 7,823 | 147 | |||||||||||
| Depreciation | 28,875 | 21,157 | 68,693 | 64,705 | |||||||||||
| Amortization of intangibles from acquisitions | 3,480 | 423 | 4,324 | 1,384 | |||||||||||
| (Gain) loss on disposition of long-lived assets | (256 | ) | (4 | ) | 605 | 60 | |||||||||
| Total operating expenses | 167,742 | 102,182 | 409,864 | 307,864 | |||||||||||
| Operating income (loss) | (982 | ) | 9,557 | 5,271 | 23,879 | ||||||||||
| Other income (expense): | |||||||||||||||
| Interest expense, net | (3,396 | ) | (1,243 | ) | (5,640 | ) | (3,664 | ) | |||||||
| Other income (expense) | (385 | ) | (2,031 | ) | 1,923 | (4,341 | ) | ||||||||
| Other income (expense), net | (3,781 | ) | (3,274 | ) | (3,717 | ) | (8,005 | ) | |||||||
| Income (loss) before income taxes | (4,763 | ) | 6,283 | 1,554 | 15,874 | ||||||||||
| Income tax expense (benefit) | (288 | ) | 92 | (1,535 | ) | (1,057 | ) | ||||||||
| Net Income (loss) | (4,475 | ) | 6,191 | 3,089 | 16,931 | ||||||||||
| Net (income) loss attributable to non-controlling interests, net | 1,856 | (3,530 | ) | (986 | ) | (10,538 | ) | ||||||||
| Net income (loss) attributable to ATN International, Inc. stockholders | $ | (2,619 | ) | $ | 2,661 | $ | 2,103 | $ | 6,393 | ||||||
| Net income (loss) per weighted average share attributable to ATN International, Inc. stockholders: | |||||||||||||||
| Basic Net Income | $ | (0.22 | ) | $ | 0.17 | $ | 0.08 | $ | 0.40 | ||||||
| Diluted Net Income | $ | (0.22 | ) | $ | 0.17 | $ | 0.08 | $ | 0.40 | ||||||
| Weighted average common shares outstanding: | |||||||||||||||
| Basic | 15,860 | 15,962 | 15,891 | 15,946 | |||||||||||
| Diluted | 15,860 | 16,011 | 15,901 | 15,991 | |||||||||||
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| Table 3 | |||||||
| ATN International, Inc. | |||||||
| Unaudited Condensed Consolidated Cash Flow Statement | |||||||
| (in Thousands) | |||||||
| Nine Months Ended September 30, | |||||||
| 2021 | 2020 | ||||||
| Net income | $ | 3,089 | $ | 16,931 | |||
| Depreciation | 68,693 | 64,705 | |||||
| Amortization of intangibles from acquisitions | 4,324 | 1,384 | |||||
| Provision for doubtful accounts | 3,303 | 4,452 | |||||
| Amortization of debt discount and debt issuance costs | 767 | 395 | |||||
| Loss on disposition of assets and assets held-for-sale | 605 | 60 | |||||
| Stock-based compensation | 5,116 | 4,608 | |||||
| Deferred income taxes | (5,939 | ) | (6,078 | ) | |||
| (Gain) loss on equity investments | (647 | ) | 3,360 | ||||
| Unrealized (gain) loss on foreign currency | (81 | ) | 449 | ||||
| Increase in customer receivable | (25,684 | ) | – | ||||
| Change in prepaid and accrued income taxes | (2,106 | ) | 620 | ||||
| Change in other operating assets and liabilities | (3,724 | ) | (19,295 | ) | |||
| Net cash provided by operating activities | 47,716 | 71,591 | |||||
| Capital expenditures | (62,222 | ) | (48,792 | ) | |||
| Reimbursable capital expenditures | (8,700 | ) | (1,870 | ) | |||
| Purchase of businesses, net of $11.9 million of acquired cash | (340,152 | ) | – | ||||
| Purchases of intangible assets, including deposits | – | (20,396 | ) | ||||
| Purchases of strategic investments | (6,399 | ) | (2,768 | ) | |||
| Purchases of short-term investments | – | (116 | ) | ||||
| Receipt of government grants | 7,094 | – | |||||
| Proceeds from strategic investments | – | 11,969 | |||||
| Sale of business, net of transferred cash of $0.9 million and $0 million, respectively | 18,597 | – | |||||
| Net cash used in investing activities | (391,782 | ) | (61,973 | ) | |||
| Dividends paid on common stock | (8,118 | ) | (8,166 | ) | |||
| Distributions to non-controlling interests | (4,823 | ) | (6,503 | ) | |||
| Principal repayments of term loan | (2,821 | ) | (2,814 | ) | |||
| New borrowings, net of repayments | 285,000 | – | |||||
| Proceeds from mezzanine equity | 71,533 | – | |||||
| Payment of debt issuance costs | (6,568 | ) | (1,096 | ) | |||
| Proceeds from customer receivable credit facility | 27,540 | – | |||||
| Repayment of customer receivable credit facility | (1,005 | ) | – | ||||
| Purchases of common stock – stock-based compensation | (1,713 | ) | (1,733 | ) | |||
| Proceeds from stock option exercises | 383 | – | |||||
| Purchases of common stock – share repurchase plan | (4,836 | ) | (6,589 | ) | |||
| Repurchases of non-controlling interests | (13,139 | ) | (8,763 | ) | |||
| Net cash provided by (used in) financing activities | 341,433 | (35,664 | ) | ||||
| Effect of foreign currency exchange rates on total cash, cash equivalents and restricted cash | – | (87 | ) | ||||
| Net change in total cash, cash equivalents and restricted cash | (2,633 | ) | (26,133 | ) | |||
| Total cash, cash equivalents and restricted cash, beginning of period | 104,997 | 162,358 | |||||
| Total cash, cash equivalents and restricted cash, end of period | $ | 102,364 | $ | 136,225 | |||
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| Table 4 | |||||||||||||||
| ATN International, Inc. | |||||||||||||||
| Selected Segment Financial Information | |||||||||||||||
| (In Thousands) | |||||||||||||||
| For the three months ended September 30, 2021 is as follows: | |||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | |||||||||||
| Statement of Operations Data: | |||||||||||||||
| Revenue | |||||||||||||||
| Mobility | |||||||||||||||
| Business | $ | 1,422 | $ | 231 | $ | – | $ | – | $ | 1,653 | |||||
| Consumer | 22,423 | 1,909 | – | – | 24,332 | ||||||||||
| Total | $ | 23,845 | $ | 2,140 | $ | – | $ | – | $ | 25,985 | |||||
| Fixed | |||||||||||||||
| Business | $ | 16,549 | $ | 21,681 | $ | – | $ | – | $ | 38,230 | |||||
| Consumer | 40,870 | 15,484 | – | – | 56,354 | ||||||||||
| Total | $ | 57,419 | $ | 37,165 | $ | – | $ | – | $ | 94,584 | |||||
| Carrier Services | $ | 2,557 | $ | 31,939 | $ | – | $ | – | $ | 34,496 | |||||
| Other | 233 | – | – | – | 233 | ||||||||||
| Total Communications Services | $ | 84,054 | $ | 71,244 | $ | – | $ | – | $ | 155,298 | |||||
| Managed services | $ | 1,252 | $ | 3,793 | $ | – | $ | – | $ | 5,045 | |||||
| Construction | – | 6,417 | – | – | 6,417 | ||||||||||
| Total Other | $ | 1,252 | $ | 10,210 | $ | – | $ | – | $ | 11,462 | |||||
| Total Revenue | $ | 85,306 | $ | 81,454 | $ | – | $ | – | $ | 166,760 | |||||
| Depreciation | $ | 13,308 | $ | 14,327 | $ | – | $ | 1,240 | $ | 28,875 | |||||
| Amortization of intangibles from acquisitions | $ | 418 | $ | 3,062 | $ | – | $ | – | $ | 3,480 | |||||
| Total operating expenses | $ | 72,093 | $ | 91,284 | $ | 55 | $ | 4,310 | $ | 167,742 | |||||
| Operating Income (Loss) | $ | 13,213 | $ | (9,830 | ) | $ | (55 | ) | $ | (4,310 | ) | $ | (982 | ) | |
| Stock-based compensation | $ | 36 | $ | 101 | $ | – | $ | 1,468 | $ | 1,605 | |||||
| Non-controlling interest ( net income or (loss) ) | $ | (2,337 | ) | $ | 4,193 | $ | – | $ | – | $ | 1,856 | ||||
| Non GAAP measures: | |||||||||||||||
| EBITDA (1) | $ | 26,939 | $ | 7,559 | $ | (55 | ) | $ | (3,070 | ) | $ | 31,373 | |||
| Adjusted EBITDA (2) | $ | 26,872 | $ | 16,404 | $ | (56 | ) | $ | (6,407 | ) | $ | 36,813 | |||
| Balance Sheet Data (at September 30, 2021): | |||||||||||||||
| Cash, cash equivalents and investments | $ | 52,106 | $ | 38,143 | $ | 2,476 | $ | 8,543 | $ | 101,268 | |||||
| Total current assets | 116,271 | 116,852 | 6,322 | 10,260 | 249,705 | ||||||||||
| Fixed assets, net | 448,062 | 457,154 | – | 10,618 | 915,834 | ||||||||||
| Total assets | 650,023 | 870,281 | 20,500 | 86,580 | 1,627,384 | ||||||||||
| Total current liabilities | 84,092 | 93,612 | 356 | 24,950 | 203,010 | ||||||||||
| Total debt | 70,142 | 239,474 | – | 65,000 | 374,616 | ||||||||||
| * Corporate and Other refer to corporate overhead expenses and consolidating adjustments | |||||||||||||||
| 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 | |||||||||||||||
| Business | $ | 1,108 | $ | 136 | $ | – | $ | – | $ | 1,244 | |||||
| Consumer | 20,298 | 2,296 | – | – | 22,594 | ||||||||||
| Total | $ | 21,406 | $ | 2,432 | $ | – | $ | – | $ | 23,838 | |||||
| Fixed | |||||||||||||||
| Business | $ | 16,516 | $ | 1,954 | $ | – | $ | – | $ | 18,470 | |||||
| Consumer | 40,848 | 3,465 | – | – | 44,313 | ||||||||||
| Total | $ | 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 | |||||
| Depreciation | $ | 13,248 | $ | 5,729 | $ | 491 | $ | 1,689 | $ | 21,157 | |||||
| Amortization of intangibles from acquisitions | $ | 423 | $ | – | $ | – | $ | – | $ | 423 | |||||
| Total operating expenses | $ | 66,441 | $ | 25,879 | $ | 1,275 | $ | 8,587 | $ | 102,182 | |||||
| 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 | ||||
| * Corporate and Other refer to corporate overhead expenses and consolidating adjustments | |||||||||||||||
| ATN International, Inc. | |||||||||||||||
| Selected Segment Financial Information | |||||||||||||||
| (In Thousands) | |||||||||||||||
| For the nine months ended September 30, 2021 is as follows: | |||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | |||||||||||
| Statement of Operations Data: | |||||||||||||||
| Revenue | |||||||||||||||
| Mobility | |||||||||||||||
| Business | $ | 3,917 | $ | 1,149 | $ | – | $ | – | $ | 5,066 | |||||
| Consumer | 64,503 | 6,258 | – | – | 70,761 | ||||||||||
| Total | $ | 68,420 | $ | 7,407 | $ | – | $ | – | $ | 75,827 | |||||
| Fixed | |||||||||||||||
| Business | $ | 50,037 | $ | 26,409 | $ | – | $ | – | $ | 76,446 | |||||
| Consumer | 125,255 | 23,004 | – | – | 148,259 | ||||||||||
| Total | $ | 175,292 | $ | 49,413 | $ | – | $ | – | $ | 224,705 | |||||
| Carrier Services | $ | 6,963 | $ | 70,713 | $ | – | $ | – | $ | 77,676 | |||||
| Other | 689 | – | – | – | 689 | ||||||||||
| Total Communications Services | $ | 251,364 | $ | 127,533 | $ | – | $ | – | $ | 378,897 | |||||
| Renewable Energy | $ | – | $ | – | $ | 418 | $ | – | $ | 418 | |||||
| Managed services | 3,978 | 3,793 | – | – | 7,771 | ||||||||||
| Construction | – | 28,049 | – | – | 28,049 | ||||||||||
| Total Other | $ | 3,978 | $ | 31,842 | $ | 418 | $ | – | $ | 36,238 | |||||
| Total Revenue | $ | 255,342 | $ | 159,375 | $ | 418 | $ | – | $ | 415,135 | |||||
| Depreciation | $ | 40,080 | $ | 24,598 | $ | 188 | $ | 3,827 | $ | 68,693 | |||||
| Amortization of intangibles from acquisitions | $ | 1,262 | $ | 3,062 | $ | – | $ | – | $ | 4,324 | |||||
| Total operating expenses | $ | 214,343 | $ | 170,295 | $ | 1,906 | $ | 23,320 | $ | 409,864 | |||||
| Operating Income (Loss) | $ | 40,999 | $ | (10,920 | ) | $ | (1,488 | ) | $ | (23,320 | ) | $ | 5,271 | ||
| Stock-based compensation | $ | 83 | $ | – | $ | 22 | $ | 4,911 | $ | 5,016 | |||||
| Non-controlling interest ( net income or (loss) ) | $ | (5,857 | ) | $ | 4,075 | $ | 796 | $ | – | $ | (986 | ) | |||
| Non GAAP measures: | |||||||||||||||
| EBITDA (1) | $ | 82,341 | $ | 16,740 | $ | (1,300 | ) | $ | (19,493 | ) | $ | 78,288 | |||
| Adjusted EBITDA (2) | $ | 82,276 | $ | 23,820 | $ | (110 | ) | $ | (19,270 | ) | $ | 86,716 | |||
| * Corporate and Other refer to corporate overhead expenses and consolidating adjustments | |||||||||||||||
| 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 | |||||||||||||||
| Business | $ | 3,136 | $ | 140 | $ | – | $ | – | $ | 3,276 | |||||
| Consumer | 57,468 | 7,063 | – | – | 64,531 | ||||||||||
| Total | $ | 60,604 | $ | 7,203 | $ | – | $ | – | $ | 67,807 | |||||
| Fixed | |||||||||||||||
| Business | $ | 51,115 | $ | 6,676 | $ | – | $ | – | $ | 57,791 | |||||
| Consumer | 121,305 | 8,505 | – | – | 129,810 | ||||||||||
| Total | $ | 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 | |||||
| Depreciation | $ | 40,736 | $ | 17,331 | $ | 1,590 | $ | 5,048 | $ | 64,705 | |||||
| Amortization of intangibles from acquisitions | $ | 1,384 | $ | – | $ | – | $ | – | $ | 1,384 | |||||
| Total operating expenses | $ | 200,693 | $ | 77,316 | $ | 4,549 | $ | 25,306 | $ | 307,864 | |||||
| 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 | |||||||||||||||
| ATN International, Inc. | |||||||||||||||
| Selected Segment Financial Information | |||||||||||||||
| (In Thousands) | |||||||||||||||
| at December 31, 2020 | |||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | |||||||||||
| Balance Sheet Data (at December 31, 2020): | |||||||||||||||
| Cash, cash equivalents and investments | $ | 45,848 | $ | 26,921 | $ | 4,311 | $ | 26,845 | $ | 103,925 | |||||
| Total current assets | 107,315 | 65,806 | 39,057 | 27,887 | 240,065 | ||||||||||
| Fixed assets, net | 449,888 | 73,717 | – | 12,857 | 536,462 | ||||||||||
| Total assets | 642,834 | 265,797 | 39,045 | 136,035 | 1,083,711 | ||||||||||
| Total current liabilities | 80,875 | 43,200 | 1,038 | 22,815 | 147,928 | ||||||||||
| Total debt | 72,823 | – | – | – | 72,823 | ||||||||||
| (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 Operational Information | |||||||||||||||
| (In Thousands) | |||||||||||||||
| at September 30, 2021 | |||||||||||||||
| Quarter ended | |||||||||||||||
| September 30, | December 31, | March 31, | June 30, | September 30, | |||||||||||
| 2020 | 2020 | 2021 | 2021 | 2021 | |||||||||||
| International Telecom Operational Data: | |||||||||||||||
| Mobile – Subscribers * | |||||||||||||||
| Pre-Paid | 244,700 | 257,200 | 261,900 | 273,400 | 276,400 | ||||||||||
| Post-Paid | 43,100 | 44,700 | 45,500 | 46,400 | 49,300 | ||||||||||
| Total | 287,800 | 301,900 | 307,400 | 319,800 | 325,700 | ||||||||||
| Mobile – Churn | 1.77 | % | 2.18 | % | 2.28 | % | 2.21 | % | 2.67 | % | |||||
| Fixed – Subscribers* | |||||||||||||||
| Broadband | 136,800 | 140,100 | 142,900 | 143,000 | 143,900 | ||||||||||
| Video | 35,800 | 35,800 | 35,300 | 33,600 | 33,100 | ||||||||||
| Voice | 163,700 | 164,300 | 165,500 | 165,800 | 166,200 | ||||||||||
| * Counts were adjusted for all periods presented based upon a change in methodology and process | |||||||||||||||
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| Table 5 | |||||||||||||||
| ATN International, Inc. | |||||||||||||||
| Reconciliation of Non-GAAP Measures | |||||||||||||||
| (In Thousands) | |||||||||||||||
| For the three months ended September 30, 2021 is as follows: | |||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | |||||||||||
| Operating income (loss) | $ | 13,213 | $ | (9,830 | ) | $ | (55 | ) | $ | (4,310 | ) | $ | (982 | ) | |
| Depreciation expense | 13,308 | 14,327 | – | 1,240 | 28,875 | ||||||||||
| Amortization of intangibles from acquisitions | 418 | 3,062 | – | – | 3,480 | ||||||||||
| EBITDA | $ | 26,939 | $ | 7,559 | $ | (55 | ) | $ | (3,070 | ) | $ | 31,373 | |||
| Transaction-related charges | – | 9,033 | – | (3,337 | ) | $ | 5,696 | ||||||||
| (Gain) Loss on disposition of assets | (67 | ) | (188 | ) | (1 | ) | – | $ | (257 | ) | |||||
| ADJUSTED EBITDA | $ | 26,872 | $ | 16,404 | $ | (56 | ) | $ | (6,407 | ) | $ | 36,813 | |||
| Revenue | 85,306 | 81,454 | – | – | 166,760 | ||||||||||
| ADJUSTED EBITDA MARGIN | 31.5 | % | 20.1 | % | NA | NA | 22.1 | % | |||||||
| 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 expense | 13,248 | 5,729 | 491 | 1,689 | 21,157 | ||||||||||
| Amortization of intangibles from acquisitions | 423 | – | – | – | 423 | ||||||||||
| 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 | % | ||||||
| ATN International, Inc. | |||||||||||||||
| Reconciliation of Non-GAAP Measures | |||||||||||||||
| (In Thousands) | |||||||||||||||
| For the nine months ended September 30, 2021 is as follows: | |||||||||||||||
| International Telecom | US Telecom | Renewable Energy | Corporate and Other * | Total | |||||||||||
| Operating income (loss) | $ | 40,999 | $ | (10,920 | ) | $ | (1,488 | ) | $ | (23,320 | ) | $ | 5,271 | ||
| Depreciation expense | 40,080 | 24,598 | 188 | 3,827 | 68,693 | ||||||||||
| Amortization of intangibles from acquisitions | 1,262 | 3,062 | – | – | 4,324 | ||||||||||
| EBITDA | $ | 82,341 | $ | 16,740 | $ | (1,300 | ) | $ | (19,493 | ) | $ | 78,288 | |||
| Transaction-related charges | – | 7,257 | 566 | – | 7,823 | ||||||||||
| (Gain) Loss on disposition of assets | (65 | ) | (177 | ) | 624 | 223 | 605 | ||||||||
| ADJUSTED EBITDA | $ | 82,276 | $ | 23,820 | $ | (110 | ) | $ | (19,270 | ) | $ | 86,716 | |||
| Revenue | 255,342 | 159,375 | 418 | – | 415,135 | ||||||||||
| ADJUSTED EBITDA MARGIN | 32.2 | % | 14.9 | % | -26.4 | % | NA | 20.9 | % | ||||||
| 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 expense | 40,736 | 17,331 | 1,590 | 5,048 | 64,705 | ||||||||||
| Amortization of intangibles from acquisitions | 1,384 | – | – | – | 1,384 | ||||||||||
| 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 | % | ||||||
1 See Table 5 for reconciliation of Operating Income to EBITDA, a non-GAAP measure.
2 See Table 5 for reconciliation of Operating Income to Adjusted EBITDA, a non-GAAP measure.
| Contact: | 978-619-1300 |
| Michael T. Prior | |
| Chairman and | |
| Chief Executive Officer | |
| Justin D. Benincasa | |
| Chief Financial Officer |
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