TDS reports second quarter 2019 results

CHICAGO, Aug. 1, 2019 /PRNewswire/ --  

As previously announced, TDS will hold a teleconference August 2, 2019, at 9:00 a.m. CDT. Listen to the call live via the Events & Presentations page of investors.tdsinc.com.

Telephone and Data Systems, Inc. TDS reported total operating revenues of $1,261 million for the second quarter of 2019, versus $1,255 million for the same period one year ago. Net income attributable to TDS shareholders and related diluted earnings per share were $33 million and $0.28, respectively, for the second quarter of 2019 compared to $33 million and $0.29, respectively, in the same period one year ago.

"The TDS family of companies produced solid financial results for the second quarter of 2019 and made significant progress toward achieving their long-term strategic goals," said LeRoy T. Carlson, Jr., TDS President and CEO. "U.S. Cellular grew service revenues and Adjusted EBITDA, while sustaining high customer loyalty, and it continued making enhancements to its high-performing network. TDS Telecom expanded its broadband customer base, increased profitability and continued implementing its fiber deployment strategy.

"U.S. Cellular grew service revenues through an increase in average revenue per user, driven by growing interest of customers in its Total Plans, and through higher inbound roaming revenues. Customer satisfaction remained high throughout the quarter and drove very low postpaid handset churn rates. U.S. Cellular is moving steadily forward on its 5G deployment and network modernization initiatives. In the recent FCC millimeter wave auctions, U.S. Cellular successfully acquired new licenses providing access to high frequency spectrum over its footprint, that are needed to deliver exciting, new very high speed capabilities using 5G to our current and future customers.

"TDS Telecom generated both top line and bottom line growth, reporting a 60 percent increase in Net income and a 9 percent increase in Adjusted EBITDA, compared to the same quarter last year.  Both Wireline and Cable segments reported increased broadband connections and higher revenue per connection.  In Wireline, increasing video connections and customer demand for higher broadband speeds continue to offset legacy voice declines.  Wireline continued fiber expansion growth even deeper into its markets while expanding its fiber footprint in attractive out-of-territory markets in Wisconsin and Idaho. Cable operations produced an outstanding quarter, generating 9 percent growth in cable revenues which drove a 29 percent increase in Adjusted EBITDA, compared to the same quarter last year."

2019 Estimated Results

TDS' current estimates of full-year 2019 results for U.S. Cellular, TDS Telecom, and TDS are shown below.  Such estimates represent management's view as of August 1, 2019 and should not be assumed to be current as of any future date.  TDS undertakes no duty to update such estimates, whether as a result of new information, future events, or otherwise.  There can be no assurance that final results will not differ materially from estimated results.



2019 Estimated Results



U.S. Cellular



TDS Telecom



TDS (1)



Previous

Current



Previous

Current



Previous

Current

(Dollars in millions)

















Total operating revenues

$4,000-$4,200

$3,900-$4,100*



$900-$950

Unchanged



$5,125-$5,375

$5,025-$5,275*

Adjusted OIBDA (2)

$725-$875

Unchanged



$280-$310

Unchanged



$1,000-$1,180

Unchanged

Adjusted EBITDA (2)

$900-$1,050

Unchanged



$290-$320

Unchanged



$1,185-$1,365

Unchanged

Capital expenditures

$625-$725

Unchanged



$300-$350

Unchanged



$940-$1,090

Unchanged





*

Change represents lower equipment sales revenues.

The following tables provide reconciliations of Net income to Adjusted OIBDA and Adjusted EBITDA for 2019 estimated results, actual results for the six months ended June 30, 2019, and actual results for the year ended December 31, 2018. In providing 2019 estimated results, TDS has not completed the below reconciliation to Net income because it does not provide guidance for income taxes.  Although potentially significant, TDS believes that the impact of income taxes cannot be reasonably predicted; therefore, TDS is unable to provide such guidance.



2019 Estimated Results



U.S. Cellular



TDS Telecom



TDS (1)

(Dollars in millions)











Net income (GAAP)

N/A



N/A



N/A

Add back:











Income tax expense (benefit)

N/A



N/A



N/A

Income before income taxes (GAAP)

$70-$220



$85-$115



$60-$240

Add back:











Interest expense

115





175

Depreciation, amortization and accretion expense

700



205



935

EBITDA (Non-GAAP) (2)

$885-$1,035



$290-$320



$1,170-$1,350

Add back or deduct:











(Gain) loss on asset disposals, net

15





15

Adjusted EBITDA (Non-GAAP) (2)

$900-$1,050



$290-$320



$1,185-$1,365

Deduct:











Equity in earnings of unconsolidated entities

155





155

Interest and dividend income

20



10



30

Adjusted OIBDA (Non-GAAP) (2)

$725-$875



$280-$310



$1,000-$1,180

 



Actual Results



Six Months Ended

June 30, 2019



Year Ended

December 31, 2018



U.S.

Cellular



TDS

Telecom



TDS (1)



U.S.

Cellular



TDS

Telecom



TDS (1)

(Dollars in millions)























Net income (GAAP)

$

90





$

56





$

109





$

164





$

89





$

175



Add back or deduct:























Income tax expense

41





18





50





51





16





46



Income before income taxes (GAAP)

$

131





$

74





$

159





$

215





$

105





$

221



Add back:























Interest expense

58





(1)





86





116





(2)





172



Depreciation, amortization and accretion expense

345





100





460





640





212





883



EBITDA (Non-GAAP) (2)

$

534





$

173





$

705





$

971





$

315





$

1,276



Add back or deduct:























(Gain) loss on asset disposals, net

7





(8)









10





(2)





9



(Gain) loss on sale of business and other exit costs, net

(2)









(2)















(Gain) loss on license sales and exchanges, net

(2)









(2)





(18)









(18)



Adjusted EBITDA (Non-GAAP) (2)

$

537





$

165





$

701





$

963





$

313





$

1,267



Deduct:























Equity in earnings of unconsolidated entities

84









85





159









160



Interest and dividend income

11





6





17





15





8





26



Other, net

(1)









1





(1)





2





2



Adjusted OIBDA (Non-GAAP) (2)

$

443





$

159





$

598





$

790





$

303





$

1,079





Numbers may not foot due to rounding.



(1)

The TDS column includes U.S. Cellular, TDS Telecom and also the impacts of consolidating eliminations, corporate operations and non-reportable segments.





(2)

EBITDA, Adjusted EBITDA and Adjusted OIBDA are defined as net income adjusted for the items set forth in the reconciliation above.  EBITDA, Adjusted EBITDA and Adjusted OIBDA are not measures of financial performance under Generally Accepted Accounting Principles in the United States (GAAP) and should not be considered as alternatives to Net income or Cash flows from operating activities, as indicators of cash flows or as measures of liquidity.  TDS does not intend to imply that any such items set forth in the reconciliation above are non-recurring, infrequent or unusual; such items may occur in the future.  Management uses Adjusted EBITDA and Adjusted OIBDA as measurements of profitability, and therefore reconciliations to Net income are deemed appropriate.  Management believes Adjusted EBITDA and Adjusted OIBDA are useful measures of TDS' operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance.  Adjusted EBITDA shows adjusted earnings before interest, taxes, depreciation, amortization and accretion, and gains and losses, while Adjusted OIBDA reduces this measure further to exclude Equity in earnings of unconsolidated entities and Interest and dividend income in order to more effectively show the performance of operating activities excluding investment activities.  The table above reconciles EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measure, Net income or Income before income taxes. Additional information and reconciliations related to Non-GAAP financial measures for June 30, 2019, can be found on TDS' website at investors.tdsinc.com.

Conference Call Information

TDS will hold a conference call on August 2, 2019 at 9:00 a.m. Central Time.

Before the call, certain financial and statistical information to be discussed during the call will be posted to investors.tdsinc.com. The call will be archived on the Events & Presentations page of investors.tdsinc.com.

About TDS

Telephone and Data Systems, Inc. (TDS), a Fortune 1000® company, provides wireless; cable and wireline broadband, video and voice; and hosted and managed services to approximately 6 million connections nationwide through its businesses, U.S. Cellular, TDS Telecom, BendBroadband and OneNeck IT Solutions. Founded in 1969 and headquartered in Chicago, TDS employed 9,400 people as of June 30, 2019.

Visit investors.tdsinc.com for comprehensive financial information, including earnings releases, quarterly and annual filings, shareholder information and more.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company's plans, beliefs, estimates, and expectations. These statements are based on current estimates, projections, and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: intense competition; the ability to execute TDS' business strategy; uncertainties in TDS' future cash flows and liquidity and access to the capital markets; the ability to make payments on TDS and U.S. Cellular indebtedness or comply with the terms of debt covenants; impacts of any pending acquisitions/divestitures/exchanges of properties and/or licenses,  including, but not limited to, the ability to obtain regulatory approvals, successfully complete the transactions and the financial impacts of such transactions; the ability of the company to successfully manage and grow its markets; the access to and pricing of unbundled network elements; the ability to obtain or maintain roaming arrangements with other carriers on acceptable terms; the state and federal telecommunications regulatory environment; the value of assets and investments; adverse changes in the ratings of TDS and U.S. Cellular debt securities by accredited ratings organizations; industry consolidation; advances in telecommunications technology; pending and future litigation; changes in income tax rates, laws, regulations or rulings; changes in customer growth rates, average monthly revenue per user, churn rates, roaming revenue and terms, the availability of wireless devices, or the mix of services and products offered by U.S. Cellular and TDS Telecom. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K Current Report used by TDS to furnish this press release to the Securities and Exchange Commission, which are incorporated by reference herein.

For more information about TDS and its subsidiaries, visit:

TDS: www.tdsinc.com

U.S. Cellular: www.uscellular.com

TDS Telecom: www.tdstelecom.com

OneNeck IT Solutions: www.oneneck.com

United States Cellular Corporation

Summary Operating Data (Unaudited)

As of or for the Quarter Ended

6/30/2019



3/31/2019



12/31/2018



9/30/2018



6/30/2018

Retail Connections



















Postpaid



















Total at end of period

4,414,000





4,440,000





4,472,000





4,466,000





4,468,000



Gross additions

137,000





137,000





179,000





172,000





146,000



Feature phones

5,000





4,000





4,000





3,000





5,000



Smartphones

97,000





98,000





132,000





130,000





106,000



Connected devices

35,000





35,000





43,000





39,000





35,000



Net additions (losses)

(26,000)





(32,000)





6,000





(1,000)





(13,000)



Feature phones

(10,000)





(13,000)





(11,000)





(14,000)





(12,000)



Smartphones

(1,000)





(1,000)





31,000





29,000





17,000



Connected devices

(15,000)





(18,000)





(14,000)





(16,000)





(18,000)



ARPU (1)

$

45.90





$

45.44





$

45.58





$

45.31





$

44.74



ARPA (2)

$

119.46





$

118.84





$

119.60





$

119.42





$

118.57



Churn rate (3)

1.23

%



1.26

%



1.29

%



1.29

%



1.19

%

Handsets

0.97

%



0.99

%



1.00

%



1.02

%



0.92

%

Connected devices

3.01

%



3.08

%



3.20

%



3.04

%



2.85

%

Prepaid



















Total at end of period

500,000





503,000





516,000





528,000





527,000



Gross additions

61,000





61,000





66,000





80,000





78,000



Net additions (losses)

(2,000)





(13,000)





(12,000)





1,000





2,000



ARPU (1)

$

34.43





$

33.44





$

32.80





$

32.09





$

32.32



Churn rate (3)

4.20

%



4.92

%



4.98

%



4.98

%



4.83

%

Total connections at end of period (4)

4,967,000





4,995,000





5,041,000





5,050,000





5,051,000



Market penetration at end of period



















Consolidated operating population

31,310,000





31,310,000





31,469,000





31,469,000





31,469,000



Consolidated operating penetration (5)

16

%



16

%



16

%



16

%



16

%

Capital expenditures (millions)

$

195





$

102





$

242





$

118





$

86



Total cell sites in service

6,535





6,506





6,531





6,506





6,478



Owned towers

4,116





4,106





4,129





4,119





4,105







(1)

Average Revenue Per User (ARPU) - metric is calculated by dividing a revenue base by an average number of connections and by the number of months in the period.  These revenue bases and connection populations are shown below:



Postpaid ARPU consists of total postpaid service revenues and postpaid connections.



Prepaid ARPU consists of total prepaid service revenues and prepaid connections.





(2)

Average Revenue Per Account (ARPA) - metric is calculated by dividing total postpaid service revenues by the average number of postpaid accounts and by the number of months in the period.





(3)

Churn rate represents the percentage of the connections that disconnect service each month.  These rates represent the average monthly churn rate for each respective period.





(4)

Includes reseller and other connections.





(5)

Market penetration is calculated by dividing the number of wireless connections at the end of the period by the total population of consolidated operating markets as estimated by Nielsen.

 

TDS Telecom

Summary Operating Data (Unaudited)

As of or for the Quarter Ended

6/30/2019



3/31/2019



12/31/2018



9/30/2018



6/30/2018

TDS Telecom



















Wireline



















Residential connections



















Voice (1)

269,000





271,100





274,100





278,400





282,200



Broadband (2)

240,200





236,100





235,400





237,100





234,300



Video (3)

56,200





54,300





54,000





53,100





51,500



Wireline residential connections

565,500





561,500





563,500





568,600





568,000























Total residential revenue per connection (4)

$

47.88





$

48.16





$

47.39





$

47.30





$

47.22























Commercial connections



















Voice (1)

124,200





127,300





130,500





134,000





137,300



Broadband (2)

20,600





20,400





20,600





20,700





20,600



managedIP (5)

128,300





132,000





134,000





138,000





141,400



Video (3)

400





400





400





400





400



Wireline commercial connections

273,500





280,100





285,400





293,100





299,600























Total Wireline connections

839,000





841,500





848,900





861,700





867,700























Cable



















Cable residential and commercial connections



















Broadband (6)

172,600





171,100





167,400





163,600





159,400



Video (7)

100,300





101,400





102,900





102,100





101,600



Voice (8)

64,800





65,400





65,200





63,600





62,000



managedIP (5)

1,100





1,100





1,000





700





700



Total Cable connections

338,900





339,000





336,500





330,100





323,700





Numbers may not foot due to rounding.





(1)

The individual circuits connecting a customer to Wireline's central office facilities.





(2)

The number of Wireline customers provided high-capacity data circuits via various technologies, including DSL and dedicated internet circuit technologies.





(3)

The number of Wireline customers provided video services.





(4)

Total residential revenue per connection is calculated by dividing total Wireline residential revenue by the average number of Wireline residential connections and by the number of months in the period.





(5)

The number of telephone handsets, data lines and IP trunks providing communications using IP networking technology.





(6)

Billable number of lines into a building for high-speed data services.





(7)

Generally, a home or business receiving video programming counts as one video connection. In counting bulk residential or commercial connections, such as an apartment building or hotel, connections are counted based on the number of units/rooms within the building receiving service.





(8)

Billable number of lines into a building for voice services.

 

TDS Telecom

Capital Expenditures (Unaudited)

Quarter Ended

6/30/2019



3/31/2019



12/31/2018



9/30/2018



6/30/2018

(Dollars in millions)



















Wireline

$

55





$

29





$

73





$

41





$

33



Cable

15





13





19





13





13



Total TDS Telecom

$

70





$

42





$

91





$

54





$

46





Numbers may not foot due to rounding.

 

Telephone and Data Systems, Inc.

Consolidated Statement of Operations Highlights

(Unaudited)











Three Months Ended

June 30,



Six Months Ended

June 30,



2019



2018



2019

vs. 2018



2019



2018



2019

vs. 2018

(Dollars and shares in millions, except per share amounts)























Operating revenues























U.S. Cellular

$

973





$

974







$

1,939





$

1,915





1

%

TDS Telecom

233





230





1

%



464





461





1

%

All Other (1)

55





51





6

%



115





104





11

%



1,261





1,255







2,518





2,480





2

%

Operating expenses























U.S. Cellular























Expenses excluding depreciation, amortization and accretion

761





769





(1)

%



1,496





1,492





Depreciation, amortization and accretion

177





159





11

%



345





317





8

%

(Gain) loss on asset disposals, net

5





1





N/M





7





2





N/M



(Gain) loss on sale of business and other exit costs, net









N/M





(2)









N/M



(Gain) loss on license sales and exchanges, net





(11)





N/M





(2)





(17)





88

%



943





918





3

%



1,844





1,794





3

%

TDS Telecom























Expenses excluding depreciation, amortization and accretion

155





158





(2)

%



305





308





(1)

%

Depreciation, amortization and accretion

50





53





(7)

%



100





107





(7)

%

(Gain) loss on asset disposals, net

(1)





1





N/M





(8)





1





N/M





204





212





(4)

%



398





417





(5)

%

All Other (1)























Expenses excluding depreciation and amortization

58





57





3

%



119





112





6

%

Depreciation and amortization

7





8





(6)

%



15





17





(4)

%

(Gain) loss on asset disposals, net

1









N/M





1









N/M





66





64





2

%



134





128





5

%

Total operating expenses

1,213





1,194





2

%



2,376





2,339





2

%

Operating income (loss)























U.S. Cellular

30





56





(45)

%



95





121





(21)

%

TDS Telecom

29





18





60

%



66





43





52

%

All Other (1)

(11)





(13)





14

%



(19)





(23)





20

%



48





61





(21)

%



142





141





1

%

Investment and other income (expense)























Equity in earnings of unconsolidated entities

41





40





2

%



85





78





9

%

Interest and dividend income

9





6





43

%



17





11





51

%

Interest expense

(43)





(43)





1

%



(86)





(86)





1

%

Other, net





1





N/M





1





2





N/M



Total investment and other income

7





4





54

%



17





5





N/M



Income before income taxes

55





65





(16)

%



159





146





9

%

Income tax expense

16





21





(23)

%



50





45





12

%

Net income

39





44





(12)

%



109





101





8

%

Less: Net income attributable to noncontrolling interests, net of tax

6





11





(44)

%



17





29





(41)

%

Net income attributable to TDS shareholders

$

33





$

33





(2)

%



$

92





$

72





28

%

























Basic weighted average shares outstanding

114





112





2

%



114





112





2

%

Basic earnings per share attributable to TDS shareholders

$

0.29





$

0.30





(4)

%



$

0.81





$

0.65





25

%

























Diluted weighted average shares outstanding

116





113





3

%



116





113





3

%

Diluted earnings per share attributable to TDS shareholders

$

0.28





$

0.29





(4)

%



$

0.78





$

0.63





24

%



N/M - Percentage change not meaningful.



Numbers may not foot due to rounding.



(1)

Consists of TDS corporate, intercompany eliminations and all other business operations not included in the U.S. Cellular and TDS Telecom segments.

 

Telephone and Data Systems, Inc.

Consolidated Statement of Cash Flows

(Unaudited)





Six Months Ended

June 30,



2019



2018

(Dollars in millions)







Cash flows from operating activities







Net income

$

109





$

101



Add (deduct) adjustments to reconcile net income to net cash flows from operating activities







Depreciation, amortization and accretion

460





441



Bad debts expense

50





43



Stock-based compensation expense

33





23



Deferred income taxes, net

40





25



Equity in earnings of unconsolidated entities

(85)





(78)



Distributions from unconsolidated entities

76





70



(Gain) loss on asset disposals, net





3



(Gain) loss on sale of business and other exit costs, net

(2)







(Gain) loss on license sales and exchanges, net

(2)





(17)



Other operating activities

3





2



Changes in assets and liabilities from operations







Accounts receivable

(2)





51



Equipment installment plans receivable

(11)





(47)



Inventory

(4)





(8)



Accounts payable

(9)





(50)



Customer deposits and deferred revenues

8





(25)



Accrued taxes

2





(5)



Other assets and liabilities

(74)





(66)



Net cash provided by operating activities

592





463











Cash flows from investing activities







Cash paid for additions to property, plant and equipment

(393)





(275)



Cash paid for acquisitions and licenses

(255)





(10)



Cash received from investments

11





100



Cash paid for investments

(11)







Cash received from divestitures and exchanges

32





21



Other investing activities





3



Net cash used in investing activities

(616)





(161)











Cash flows from financing activities







Repayment of long-term debt

(11)





(10)



TDS Common Shares reissued for benefit plans, net of tax payments

(6)





7



U.S. Cellular Common Shares reissued for benefit plans, net of tax payments

(8)







Dividends paid to TDS shareholders

(38)





(36)



Distributions to noncontrolling interests

(2)





(4)



Other financing activities

3





(4)



Net cash used in financing activities

(62)





(47)











Net increase (decrease) in cash, cash equivalents and restricted cash

(86)





255











Cash, cash equivalents and restricted cash







Beginning of period

927





622



End of period

$

841





$

877



 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)



ASSETS











June 30, 2019 (1)



December 31, 2018

(Dollars in millions)







Current assets







Cash and cash equivalents

$

834





$

921



Short-term investments

18





17



Accounts receivable

1,082





1,099



Inventory, net

154





150



Prepaid expenses

95





103



Income taxes receivable

17





12



Other current assets

28





28



Total current assets

2,228





2,330











Assets held for sale





54











Licenses

2,478





2,195











Goodwill

509





509











Other intangible assets, net

241





253











Investments in unconsolidated entities

490





480











Property, plant and equipment, net

3,318





3,346











Operating lease right-of-use assets

963















Other assets and deferred charges

568





616











Total assets

$

10,795





$

9,783



 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)



LIABILITIES AND EQUITY











June 30, 2019 (1)



December 31, 2018

(Dollars in millions, except per share amounts)







Current liabilities







Current portion of long-term debt

$

21





$

21



Accounts payable

367





365



Customer deposits and deferred revenues

205





197



Accrued interest

13





11



Accrued taxes

45





44



Accrued compensation

77





127



Short-term operating lease liabilities

112







Other current liabilities

85





114



Total current liabilities

925





879











Liabilities held for sale





1











Deferred liabilities and credits







Deferred income tax liability, net

681





640



Long-term operating lease liabilities

927







Other deferred liabilities and credits

450





541











Long-term debt, net

2,409





2,418











Noncontrolling interests with redemption features

10





11











Equity







TDS shareholders' equity







Series A Common and Common Shares, par value $.01 per share

1





1



Capital in excess of par value

2,438





2,432



Treasury shares, at cost

(488)





(519)



Accumulated other comprehensive loss

(10)





(10)



Retained earnings

2,684





2,656



Total TDS shareholders' equity

4,625





4,560











Noncontrolling interests

768





733











Total equity

5,393





5,293











Total liabilities and equity

$

10,795





$

9,783







(1)

As of January 1, 2019, TDS adopted the new lease accounting standard, ASC 842. Under this method, the new accounting standard is applied only to the most recent period presented. As a result, 2019 amounts include the impacts of ASC 842, but 2018 amounts remain as previously reported.

 

Balance Sheet Highlights

(Unaudited)







June 30, 2019



U.S.



TDS



TDS

Corporate



Intercompany



TDS



Cellular



Telecom



& Other



Eliminations



Consolidated

(Dollars in millions)



















Cash and cash equivalents

$

528





$

26





$

280





$





$

834



Affiliated cash investments





499









(499)









$

528





$

525





$

280





$

(499)





$

834























Licenses, goodwill and other intangible assets

$

2,469





$

745





$

14





$





$

3,228



Investment in unconsolidated entities

450





4





46





(10)





490





$

2,919





$

749





$

60





$

(10)





$

3,718























Property, plant and equipment, net

$

2,154





$

1,047





$

117





$





$

3,318























Long-term debt, net:



















Current portion

$

19





$

1





$

1





$





$

21



Non-current portion

1,596





2





811









2,409





$

1,615





$

3





$

812





$





$

2,430



 

TDS Telecom Highlights

(Unaudited)



























Three Months Ended

June 30,



Six Months Ended

June 30,



2019



2018



2019 vs.

2018



2019



2018



2019 vs.

2018

(Dollars in millions)























Wireline























Operating revenues























Residential

$

81





$

80





1

%



$

162





$

160





1

%

Commercial

42





46





(8)

%



86





94





(9)

%

Wholesale

49





46





5

%



94





94





1

%

Total service revenues

172





173





(1)

%



342





348





(2)

%

Equipment and product sales









(36)

%



1





1





(28)

%



172





174





(1)

%



343





349





(2)

%

Operating expenses























Cost of services

64





67





(3)

%



127





131





(3)

%

Cost of equipment and products









(44)

%



1





1





(33)

%

Selling, general and administrative expenses

49





50





(1)

%



96





97





(1)

%

Expenses excluding depreciation, amortization and accretion

114





117





(3)

%



224





229





(2)

%

Depreciation, amortization and accretion

33





36





(8)

%



66





72





(9)

%

(Gain) loss on asset disposals, net

(1)





1





N/M





(8)





1





N/M





145





153





(5)

%



282





302





(7)

%

Operating income

$

27





$

21





29

%



$

61





$

47





30

%

























Cable























Operating revenues























Residential

$

51





$

47





8

%



$

100





$

92





8

%

Commercial

11





10





9

%



21





20





8

%



62





57





9

%



121





112





8

%

Operating expenses























Cost of services

27





27









52





52







Selling, general and administrative expenses

15





15





5

%



30





28





6

%

Expenses excluding depreciation, amortization and accretion

42





41





2

%



82





80





2

%

Depreciation, amortization and accretion

17





18





(4)

%



34





35





(3)

%

(Gain) loss on asset disposals, net









(54)

%



1





1





(4)

%



59





59









117





116





1

%

Operating income (loss)

$

2





$

(3)





N/M





$

5





$

(4)





N/M



























Total TDS Telecom operating income

$

29





$

18





60

%



$

66





$

43





52

%



N/M - Percentage change not meaningful.



Numbers may not foot due to rounding.

 

Telephone and Data Systems, Inc.

Financial Measures and Reconciliations



Free Cash Flow





Three Months Ended

June 30,



Six Months Ended

June 30,



2019



2018



2019



2018

(Dollars in millions)















Cash flows from operating activities (GAAP)

$

265





$

249





$

592





$

463



Less: Cash paid for additions to property, plant and equipment

239





145





393





275



Free cash flow (Non-GAAP) (1)

$

26





$

104





$

199





$

188







(1)

Free cash flow is a non-GAAP financial measure which TDS believes may be useful to investors and other users of its financial information in evaluating liquidity, specifically, the amount of net cash generated by business operations after deducting Cash paid for additions to property, plant and equipment.

EBITDA, Adjusted EBITDA and Adjusted OIBDA

The following tables reconcile EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measures, Net income or Income (loss) before income taxes and Operating income (loss).



Three Months Ended

June 30,

TDS TELECOM

2019



2018

(Dollars in millions)







Net income (GAAP)

$

25





$

16



Add back:







Income tax expense

8





5



Interest expense

(1)







Depreciation, amortization and accretion

50





53



EBITDA (Non-GAAP)

82





74



Add back or deduct:







(Gain) loss on asset disposals, net

(1)





1



Adjusted EBITDA (Non-GAAP)

82





75



Deduct:







Interest and dividend income

3





2



Other, net





1



Adjusted OIBDA (Non-GAAP)

78





73



Deduct:







Depreciation, amortization and accretion

50





53



(Gain) loss on asset disposals, net

(1)





1



Operating income (GAAP)

$

29





$

18





Numbers may not foot due to rounding.







Three Months Ended

June 30,

WIRELINE

2019



2018

(Dollars in millions)







Income before income taxes (GAAP)

$

30





$

24



Add back:







Interest expense

(1)







Depreciation, amortization and accretion

33





36



EBITDA (Non-GAAP)

62





59



Add back or deduct:







(Gain) loss on asset disposals, net

(1)





1



Adjusted EBITDA (Non-GAAP)

62





59



Deduct:







Interest and dividend income

3





2



Other, net





1



Adjusted OIBDA (Non-GAAP)

59





57



Deduct:







Depreciation, amortization and accretion

33





36



(Gain) loss on asset disposals, net

(1)





1



Operating income (GAAP)

$

27





$

21





Numbers may not foot due to rounding.







Three Months Ended

June 30,

CABLE

2019



2018

(Dollars in millions)







Income (loss) before income taxes (GAAP)

$

3





$

(2)



Add back:







Depreciation, amortization and accretion

17





18



EBITDA (Non-GAAP)

20





15



Add back or deduct:







(Gain) loss on asset disposals, net







Adjusted EBITDA (Non-GAAP)

20





16



Deduct:







Interest and dividend income







Adjusted OIBDA (Non-GAAP)

20





16



Deduct:







Depreciation, amortization and accretion

17





18



(Gain) loss on asset disposals, net







Operating income (loss) (GAAP)

$

2





$

(3)





Numbers may not foot due to rounding.

 

Cision View original content:http://www.prnewswire.com/news-releases/tds-reports-second-quarter-2019-results-300895287.html

SOURCE Telephone and Data Systems, Inc.

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Date
ticker
name
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: EarningsPress ReleasesConference Call Announcements
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!