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8-K - 8-K - ATN International, Inc.a16-20517_18k.htm

Exhibit 99.1

 

 

NEWS RELEASE

 

FOR IMMEDIATE RELEASE

CONTACT:

978-619-1300

Wednesday October 26, 2016

 

Michael T. Prior

 

 

Chief Executive Officer

 

 

 

 

 

Justin D. Benincasa

 

 

Chief Financial Officer

 

ATN Reports

Third Quarter and Nine Month 2016 Results

 

Third Quarter 2016 Financial Highlights:

 

·                  Revenues: $138.8 million

 

·                  Adjusted EBITDA(1): $46.4 million

 

·                  Operating income: $22.1 million

 

·                  Net income attributable to ATN’s stockholders: $7.2 million, or $0.44 per diluted share

 

·                  Cash flow from operating activities: $92.1 million for the first nine months of 2016

 

Beverly, MA (October 26, 2016) — ATN (NASDAQ: ATNI) today reported results for the third quarter and nine months ended September 30, 2016. Unless otherwise indicated, the discussion of the Company’s results is focused on its continuing operations, and comparisons are to the same period in the prior year.  In the first quarter of 2016, the Company changed its segment reporting structure and an unaudited recast of financial information for the eight quarterly periods in the fiscal years ending December 31, 2014 and 2015 can be found in the Company’s Form 8-K filing dated April 12, 2016.

 

Third Quarter 2016 Financial Results and Business Review

 

“This was the first full quarter of consolidated results following our recent Bermuda and U.S. Virgin Islands acquisitions, and we are pleased with the initial performance as it was in line with our expectations and represents a solid foundation from which to drive long-term revenue and operating synergies,” said Michael Prior, Chief Executive Officer.

 

“On the International Telecom side, ATN now has a balanced and diversified revenue base comprised of wireless and wireline assets located in geographies we know well and where we are among the market leaders. We are well underway with our internal integration efforts in both markets and next steps include additional planning around cross selling along with technology and network improvements and expense management. Third quarter profitability benefited from much improved operating efficiencies in Guyana for

 



 

the quarter, including the absence of unusually high marketing and legal expenses that lowered EBITDA and operating income in last year’s third quarter.

 

“Results from our U.S. Telecom segment support our expectation for full year 2016 and reflect the shift in our wholesale business to an extended term, lower priced model that has taken place over the last year. As we work on strategies to expand our wholesale business with major customers, our team has been doing a good job of reducing operating expenses in several categories.

 

“Our domestic renewables business generated year-on-year revenue growth in the third quarter, benefitting from a combination of higher production and rate escalators. We are still rapidly expanding in India and expect to meet our target of bringing on line at least 50 Megawatts of solar production facilities in India during the first quarter of 2017.  We expect the first India projects to begin generating electricity in this year’s fourth quarter but we will not see significant incremental revenue from these operations until early 2017.

 

“In summary, third quarter results provide an early indication of how our strategic growth plan is taking shape. With most of the special charges and adjustments behind us, the benefits of our recent transactions and initiatives have begun to materialize, a process that we expect will continue into the fourth quarter and become more pronounced in 2017,” Mr. Prior concluded.

 

Third quarter 2016 revenues were $138.8 million, a 43% increase from the $96.8 million reported for the third quarter of 2015. Revenue growth resulted primarily from a $47.4 million, or 125% increase in our International Telecom segment revenues mostly due to the impact of our recent Bermuda and U.S. Virgin Islands acquisitions. Adjusted EBITDA(1) for the third quarter was $46.4 million, 17% above the prior year period, resulting primarily from the impact of the recent acquisitions and reduced operating expenses in Guyana, partially offset by declines in U.S. Telecom operating results.  Operating income for the third quarter, which included a $7.3 million increase in depreciation and amortization expense primarily due to the recent acquisitions, was $22.1 million, a decrease of 2% when compared to the prior year period.

 

Net income attributable to ATN’s stockholders for the third quarter was $7.2 million or $0.44 per diluted share, compared with the prior year period of $6.6 million, or $0.41 per diluted share.

 

Revenues for the first nine months of 2016 were $328.5 million, a 21% increase from the $272.5 million reported for the same period of 2015.  Adjusted EBITDA(1) for the first nine months of 2016 was $114.9 million, up 1% from the prior year period.  Operating income of $39.9 million for the first nine months of 2016 declined from the prior year’s $70.4 million due in large part to the transaction-related and impairment charges disclosed in prior quarter results.  Net income attributable to ATN’s stockholders was $10.2 million or $0.63 per diluted share, compared with the prior year period’s $12.8 million, or $0.79 per diluted share.

 

Third Quarter 2016 Operating Highlights

 

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

 

U.S. Telecom

 

U.S. Telecom revenues consist of wireless revenues from our voice and data wholesale roaming operations and our smaller retail operations in the Southwestern United States and wireline revenues from our wholesale transport and enterprise business in the Northeastern United States.  Total U.S. Telecom segment revenues were $47.6 million in the third quarter of 2016, a 12% decrease from the $53.8 million reported in the third quarter of 2015.  U.S. Wireless revenues declined 15% to $40.1 million compared with $47.0 million in the prior year quarter, due mostly to lower wholesale roaming rates, partially offset by

 


(1)  See Table 4 for reconciliation of Net Income (Loss) to Adjusted EBITDA.

 

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growth in data traffic volume.   U.S. Wireline revenues were $6.9 million, up from $6.2 million in the prior year. The Company ended the third quarter of 2016 with 853 domestic base stations in service compared to 799 at the end of last year’s third quarter.

 

U.S. Telecom Adjusted EBITDA(1) of $24.3 million in the third quarter of 2016 represented a 19% decrease compared to the prior year’s $29.9 million.  This decrease was primarily due to lower wholesale wireless revenues in the current year quarter, offset in part by a decrease in wireless operating expenses.

 

For full year 2016, revenue for our U.S. Telecom segment is expected to range from $170 million to $180 million and the segment Adjusted EBITDA(1) margin percentage is expected to be in the mid-40s.

 

International Telecom

 

International Telecom consists of a broad range of information and communications services including wireline and wireless data, internet, voice and media service revenues from our operations in Bermuda and the Caribbean including the U.S. Virgin Islands. International Telecom revenues were $85.3 million in the third quarter of 2016, a 125% increase from the $37.9 million reported in the third quarter of 2015.  The increased revenues are the result of our recent acquisitions in Bermuda and the U.S. Virgin Islands which added $20.7 million and $26.5 million of incremental revenues, respectively, during the current year quarter.

 

International Telecom Adjusted EBITDA(1) of $24.7 million in the third quarter increased 118% from $11.3 million in the prior year period.  This is the result of the current year acquisitions and lower operating expenses in Guyana, which in the prior year included higher marketing and legal expenses.

 

Renewable Energy

 

Renewable Energy segment revenues are generated principally by the sale of energy and solar renewable energy credits from our 28 commercial solar projects in the United States.  For the third quarter of 2016, revenues from our renewable energy business were $5.9 million, up 17% from the $5.1 million in the prior year mostly due to better than expected production and certain contract rate escalations.  Adjusted EBITDA(1) for the Renewable Energy segment was $4.1 million in the third quarter, an increase of 4% over the third quarter of 2015, as growing expenses from our newly launched solar business in India offset domestic revenue growth.

 

Reportable Operating Segments

 

Financial data on our reportable operating segments for the three months ended September 30, 2016 and 2015 are as follows (in thousands):

 

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For the three months ended September 30, 2016:

 

 

 

U.S.
Telecom

 

International
 Telecom

 

Renewable
Energy

 

Reconciling
Items

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

40,076

 

$

21,075

 

$

 

$

 

$

61,151

 

Wireline

 

6,936

 

59,193

 

 

 

66,129

 

Renewable Energy

 

 

 

5,784

 

 

5,784

 

Equipment and Other

 

548

 

5,045

 

138

 

 

5,731

 

Total Revenue

 

$

47,560

 

$

85,313

 

$

5,922

 

$

 

$

138,795

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

24,296

 

24,732

 

4,073

 

(6,658

)

46,443

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

18,120

 

11,358

 

2,822

 

(10,219

)

22,081

 

 

For the three months ended September 30, 2015:

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Reconciling
Items

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

47,047

 

$

20,474

 

$

 

$

 

$

67,521

 

Wireline

 

6,243

 

15,517

 

 

 

21,760

 

Renewable Energy

 

 

 

5,052

 

 

5,052

 

Equipment and Other

 

535

 

1,914

 

 

 

2,449

 

Total Revenue

 

$

53,825

 

$

37,905

 

$

5,052

 

$

 

$

96,782

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

29,933

 

11,328

 

3,934

 

(5,545

)

39,650

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

24,218

 

4,928

 

2,694

 

(9,316

)

22,524

 

 

Balance Sheet and Cash Flow Highlights

 

Cash and cash equivalents at September 30, 2016 were $280.3 million.  In addition, the Company held $7.4 million of short-term investments and $6.8 million of restricted cash.  Net cash provided by operating activities was $92.1 million for the first nine months of 2016, compared with net cash provided by operating activities of $113.1 million for the first nine months of 2015.  The decrease in net cash provided by operating activities is due to the impact of lower operating income in the first nine months of 2016, including the transaction and restructuring charges along with the changes in accrued taxes and other working capital line items.  Capital expenditures were $78.5 million for the first nine months of 2016, and the Company expects full year 2016 capital expenditures for its Telecom businesses, including the recent Bermuda and USVI acquisitions, to be in the range of $95 million to $110 million.   Capital expenditures in the two telecom segments are higher than in the past due to concurrent network expansions and upgrades in multiple markets.  These projects include extensive fiber builds and upgrades and market-wide mobile data network upgrades.  In addition, capital expenditures for our Renewable Energy business are still expected to be in the range of $40 million to $50 million for the full year 2016, related to ongoing construction of our solar projects in India.  These annual capital expenditure estimates take into account the estimated timing of when costs will be incurred within the project build period, which can often shift between quarters.

 

Conference Call Information

 

ATN will host a conference call on Thursday, October 27, 2016 at 10:00 a.m. Eastern Time (ET) to discuss its third quarter 2016 results. The call will be hosted by Michael Prior, President and Chief Executive Officer, and Justin Benincasa, Chief Financial Officer. The dial-in numbers are US/Canada: (877) 734-4582 and

 

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International: (678) 905-9376, conference ID 2822078. A replay of the call will be available at ir.atni.com beginning at 1:00 p.m. (ET) on Thursday, October 27, 2016.

 

About ATN

 

ATN International, Inc. (Nasdaq:ATNI), headquartered in Beverly, Massachusetts, provides telecommunications services to rural, niche and other under-served markets and geographies in the United States, Bermuda and the Caribbean and owns and operates solar power systems in select locations in the United States and India. Through our operating subsidiaries, we (i) provide both wireless and wireline connectivity to residential and business customers, including a range of mobile wireless solutions, high speed internet services, media services and local exchange services, (ii) provide distributed solar electric power to corporate, utility and municipal customers and (iii) are the owner and operator of terrestrial and submarine fiber optic transport systems. For more information, please visit www.atni.com.

 

Cautionary Language Concerning Forward Looking Statements

 

This press release contains forward-looking statements relating to, among other matters, our future financial performance and results of operations; the competitive environment in our key markets, demand for our services and industry trends; the outcome of regulatory matters; the pace of our network expansion and improvement, including our level of estimated future capital expenditures and our realization of the benefits of these investments; 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)  our ability to operate our newly acquired businesses in Bermuda and the U.S. Virgin Islands and integrate these operations into our existing operations; (2) the general performance of our operations, including operating margins, revenues, and the future growth and retention of our major customers and subscriber base and consumer demand for solar power; (3) government regulation of our businesses, which may impact our FCC and other telecommunications licenses or our renewables business; (4) economic, political and other risks facing our operations; (5) our ability to maintain favorable roaming arrangements; (6) our ability to efficiently and cost-effectively upgrade our networks and IT platforms to address rapid and significant technological changes in the telecommunications industry; (7) the loss of or an inability to recruit skilled personnel in our various jurisdictions, including key members of management; (8) our ability to find investment or acquisition or disposition opportunities that fit our strategic goals for the Company; (9) increased competition; (10) our ability to expand our renewable energy business; (11) our reliance on a limited number of key suppliers and vendors for timely supply of equipment and services relating to our network infrastructure; (12) the adequacy and expansion capabilities of our network capacity and customer service system to support our customer growth; (13) the occurrence of weather events and natural catastrophes; (14) our continued access to capital and credit markets; and (15) our ability to realize the value that we believe exists in our businesses. These and other additional factors that may cause actual future events and results to differ materially from the events and results indicated in the forward-looking statements above are set forth more fully under Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the SEC on February 29, 2016 and the Company’s Quarterly Report on Form 10-Q for the quarters ended March 31, 2016 and June 30, 2016 filed with the SEC on May 10., 2016 and August 9, 2016, respectively, and other reports we file from time to time with the SEC.  The Company undertakes no obligation and has no intention to update these forward-looking statements to reflect actual results, changes in assumptions or changes in other factors that may affect such forward-looking statements.

 

Use of Non-GAAP Financial Measures

 

In addition to financial measures prepared in accordance with generally accepted accounting principles (GAAP), this news release also contains non-GAAP financial measures. Specifically, ATN has presented an Adjusted EBITDA measure and a net income measure exclusive of the results of loss on the deconsolidation of subsidiaries. Adjusted EBITDA is defined as net income attributable to ATN stockholders before income from discontinued operations, bargain purchase gain, impairment of long-lived assets,

 

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restructuring charges, interest, taxes, depreciation and amortization, transaction-related charges, other income or expense, and net income attributable to non-controlling interests. Net income attributable to ATN stockholders excluding loss on deconsolidation of subsidiary and the related earnings per diluted share is defined as net income attributable to ATN stockholders less the loss and tax impact of the deconsolidation of the subsidiary.  The Company believes that the inclusion of these non-GAAP financial measures helps investors gain a meaningful understanding of the Company’s core operating results and enhances comparing such performance with prior periods. ATN’s management uses these non-GAAP measures, in addition to GAAP financial measures, as the basis for measuring our core operating performance and comparing such performance to that of prior periods. The non-GAAP financial measures included in this news release are not meant to be considered superior to or a substitute for results of operations prepared in accordance with GAAP. Reconciliations of these non-GAAP financial measures used in this news release to the most directly comparable GAAP financial measure is set forth in the text of, and the accompanying tables to, this press release.

 

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Table 1

 

ATN International, Inc.

Unaudited Condensed Consolidated Balance Sheets

(in Thousands)

 

 

 

September 30,

 

December 31,

 

 

 

2016

 

2015

 

Assets:

 

 

 

 

 

Cash and cash equivalents

 

$

280,263

 

$

392,045

 

Restricted cash

 

1,596

 

824

 

Short-term investments

 

7,422

 

 

Other current assets

 

95,616

 

75,623

 

 

 

 

 

 

 

Total current assets

 

384,897

 

468,492

 

 

 

 

 

 

 

Long-term restricted cash

 

5,162

 

5,477

 

Property, plant and equipment, net

 

618,535

 

373,503

 

Goodwill and other intangible assets, net

 

130,397

 

90,043

 

Other assets

 

27,066

 

7,489

 

 

 

 

 

 

 

Total assets

 

$

1,166,057

 

$

945,004

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity:

 

 

 

 

 

Current portion of long-term debt

 

$

11,969

 

$

6,284

 

Taxes payable

 

13,756

 

9,181

 

Other current liabilities

 

112,212

 

68,890

 

 

 

 

 

 

 

Total current liabilities

 

137,937

 

84,355

 

 

 

 

 

 

 

Long-term debt, net of current portion

 

$

106,928

 

$

26,575

 

Deferred income taxes

 

43,202

 

45,406

 

Other long-term liabilities

 

70,150

 

26,944

 

 

 

 

 

 

 

Total long-term liabilities

 

220,280

 

98,925

 

 

 

 

 

 

 

Total liabilities

 

358,217

 

183,280

 

 

 

 

 

 

 

Total ATN International, Inc.’s stockholders’ equity

 

671,706

 

680,299

 

Non-controlling interests

 

136,134

 

81,425

 

 

 

 

 

 

 

Total equity

 

807,840

 

761,724

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

1,166,057

 

$

945,004

 

 

7



 

Table 2

ATN International, Inc.

Unaudited Condensed Consolidated Statements of Operations

(in Thousands, Except per Share Data)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2016

 

2015

 

2016

 

2015

 

Revenues:

 

 

 

 

 

 

 

 

 

Wireless

 

$

61,151

 

$

67,521

 

$

177,300

 

$

185,272

 

Wireline

 

66,129

 

21,760

 

122,190

 

63,520

 

Renewable energy

 

5,784

 

5,052

 

16,935

 

15,631

 

Equipment and other

 

5,731

 

2,449

 

12,046

 

8,030

 

Total revenue

 

138,795

 

96,782

 

328,471

 

272,453

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Termination and access fees

 

36,728

 

20,275

 

80,479

 

57,755

 

Engineering and operations

 

16,282

 

11,206

 

36,270

 

28,591

 

Sales, marketing and customer service

 

8,954

 

6,406

 

22,387

 

17,634

 

Equipment expense

 

3,146

 

3,591

 

10,498

 

10,228

 

General and administrative

 

27,242

 

15,654

 

63,949

 

43,992

 

Transaction-related charges

 

2,091

 

2,536

 

16,156

 

2,852

 

Restructuring charges

 

 

 

1,785

 

 

Depreciation and amortization

 

21,866

 

14,590

 

52,913

 

43,813

 

Impairment of long-lived assets

 

349

 

 

11,425

 

 

Bargain purchase gain

 

 

 

(7,304

)

 

(Gain) loss on disposition of long-lived assets

 

56

 

 

27

 

(2,823

)

Total operating expenses

 

116,714

 

74,258

 

288,585

 

202,042

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

22,081

 

22,524

 

39,886

 

70,411

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

Interest expense, net

 

(1,551

)

(795

)

(2,745

)

(2,153

)

Loss on deconsolidation of subsidiary

 

 

 

 

(19,937

)

Other income, net

 

766

 

53

 

643

 

118

 

Other expense, net

 

(785

)

(742

)

(2,102

)

(21,972

)

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes

 

21,296

 

21,782

 

37,784

 

48,439

 

Income tax expense

 

9,602

 

10,134

 

17,178

 

22,655

 

 

 

 

 

 

 

 

 

 

 

Net income from continuing operations

 

11,694

 

11,648

 

20,606

 

25,784

 

 

 

 

 

 

 

 

 

 

 

Income from discontinued operations, net of tax

 

 

 

 

390

 

 

 

 

 

 

 

 

 

 

 

Net income

 

11,694

 

11,648

 

20,606

 

26,174

 

Net income attributable to non-controlling interests, net

 

(4,523

)

(5,072

)

(10,400

)

(13,417

)

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

$

7,171

 

$

6,576

 

$

10,206

 

$

12,757

 

 

 

 

 

 

 

 

 

 

 

Basic net income per weighted average share attributable to ATN International, Inc. stockholders:

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.44

 

$

0.41

 

$

0.63

 

$

0.77

 

Income from discontinued operations

 

 

 

 

0.02

 

Net income

 

$

0.44

 

$

0.41

 

$

0.63

 

$

0.79

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholders:

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.44

 

$

0.41

 

$

0.63

 

$

0.77

 

Income from discontinued operations

 

 

 

 

0.02

 

Net income

 

$

0.44

 

$

0.41

 

$

0.63

 

$

0.79

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

16,148

 

16,049

 

16,128

 

16,009

 

Diluted

 

16,241

 

16,165

 

16,228

 

16,128

 

 

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Table 3

ATN International, Inc.

Unaudited Condensed Consolidated Cash Flow Statement

(in Thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2016

 

2015

 

 

 

 

 

 

 

Net income

 

$

20,606

 

$

26,174

 

Income from discontinued operations

 

 

(390

)

Depreciation and amortization

 

52,913

 

43,813

 

Loss on deconsolidation of business

 

 

19,937

 

Bargain purchase gain

 

(7,304

)

 

(Gain) loss on disposition of long-lived assets

 

27

 

(2,823

)

Impairment of long-lived assets

 

11,425

 

 

Deferred income taxes

 

(8,775

)

 

Change in prepaid and accrued income taxes

 

21,886

 

27,684

 

Change in other operating assets and liabilities

 

(5,135

)

(6,817

)

Other non-cash activity

 

6,462

 

4,967

 

 

 

 

 

 

 

Net cash provided by operating activities of continuing operations

 

92,105

 

112,545

 

Net cash provided by operating activities of discontinued operations

 

 

566

 

Net cash provided by operating activities

 

92,105

 

113,111

 

 

 

 

 

 

 

Capital expenditures

 

(78,455

)

(46,031

)

Acquisition of businesses and non-controlling interests, net of acquired cash of $12,611 and $6,571

 

(152,499

)

(11,968

)

Purchases of spectrum licenses, including deposits

 

(10,860

)

 

Net proceeds from sale of assets

 

1,424

 

5,873

 

Purchase of short-term investments

 

(7,422

)

 

Purchase of securities

 

(2,000

)

 

Change in restricted cash

 

(457

)

39,368

 

 

 

 

 

 

 

Net cash used in investing activities

 

(250,269

)

(12,758

)

 

 

 

 

 

 

Dividends paid on common stock

 

(15,468

)

(13,920

)

Proceeds from new borrowings

 

60,000

 

 

Distributions to non-controlling interests

 

(7,667

)

(11,363

)

Repayments of long-term debt

 

(7,982

)

 

Purchases of common stock

 

(3,997

)

 

Investments made by minority shareholders

 

22,409

 

 

Other

 

(650

)

(3,489

)

 

 

 

 

 

 

Net cash provided by (used in) financing activities

 

46,645

 

(28,772

)

 

 

 

 

 

 

Effect of foreign currency exchange rates on cash and cash equivalents

 

(263

)

 

 

 

 

 

 

 

Net change in cash and cash equivalents

 

(111,782

)

71,581

 

 

 

 

 

 

 

Cash and cash equivalents, beginning of period

 

392,045

 

326,216

 

 

 

 

 

 

 

Cash and cash equivalents, end of period

 

$

280,263

 

$

397,797

 

 

9



 

Table 4

ATN International, Inc.

Reconciliation of Non-GAAP Measures

(In Thousands)

 

Reconciliation of Net Income to Adjusted EBITDA for the Three Months Ended September 30, 2016 and 2015

 

Three Months Ended September 30, 2016

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Reconciling
Items

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

7,171

 

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

 

 

 

 

 

 

 

 

 

4,523

 

Income tax expense

 

 

 

 

 

 

 

 

 

9,602

 

Other income, net

 

 

 

 

 

 

 

 

 

(766

)

Interest expense, net

 

 

 

 

 

 

 

 

 

1,551

 

Operating income

 

$

18,120

 

$

11,358

 

$

2,822

 

$

(10,219

)

$

22,081

 

Depreciation and amortization

 

6,176

 

12,896

 

1,227

 

1,567

 

21,866

 

(Gain) loss on disposition of long-lived asset

 

 

56

 

 

 

56

 

Impairment of long-lived assets

 

 

349

 

 

 

349

 

Transaction-related charges

 

 

73

 

24

 

1,994

 

2,091

 

Adjusted EBITDA

 

$

24,296

 

$

24,732

 

$

4,073

 

$

(6,658

)

$

46,443

 

 

Three Months Ended September 30, 2015

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Reconciling
Items

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

6,576

 

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

 

 

 

 

 

 

 

 

 

5,072

 

Income tax expense

 

 

 

 

 

 

 

 

 

10,134

 

Other income, net

 

 

 

 

 

 

 

 

 

(53

)

Interest expense, net

 

 

 

 

 

 

 

 

 

795

 

Operating income

 

$

24,218

 

$

4,928

 

$

2,694

 

$

(9,316

)

$

22,524

 

Depreciation and amortization

 

5,715

 

6,400

 

1,205

 

1,270

 

14,590

 

Transaction-related charges

 

 

 

35

 

2,501

 

2,536

 

Adjusted EBITDA

 

$

29,933

 

$

11,328

 

$

3,934

 

$

(5,545

)

$

39,650

 

 

10



 

Reconciliation of Net Income to Adjusted EBITDA for the Nine Months Ended September 30, 2016 and 2015

 

Nine Months Ended September 30, 2016

 

 

 

U.S.
 Telecom

 

International
Telecom

 

Renewable
Energy

 

Reconciling
Items

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

10,206

 

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

 

 

 

 

 

 

 

 

 

10,400

 

Income tax expense

 

 

 

 

 

 

 

 

 

17,178

 

Other income, net

 

 

 

 

 

 

 

 

 

(643

)

Interest expense, net

 

 

 

 

 

 

 

 

 

2,745

 

Operating income

 

$

39,698

 

$

28,320

 

$

(734

)

$

(27,398

)

$

39,886

 

Depreciation and amortization

 

17,405

 

27,482

 

3,642

 

4,384

 

52,913

 

(Gain) loss on disposition of long-lived asset

 

 

27

 

 

 

27

 

Bargain purchase gain

 

 

(7,304

)

 

 

(7,304

)

Impairment of long-lived assets

 

11,076

 

349

 

 

 

11,425

 

Restructuring charges

 

 

1,785

 

 

 

1,785

 

Transaction-related charges

 

 

3,573

 

9,215

 

3,368

 

16,156

 

Adjusted EBITDA

 

$

68,179

 

$

54,232

 

$

12,123

 

$

(19,646

)

$

114,888

 

 

Nine Months Ended September 30, 2015

 

 

 

U.S.
Telecom

 

International
Telecom

 

Renewable
Energy

 

Reconciling
Items

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

 

 

 

 

 

 

 

 

$

12,757

 

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

 

 

 

 

 

 

 

 

 

13,417

 

Income tax expense

 

 

 

 

 

 

 

 

 

22,655

 

Other income, net

 

 

 

 

 

 

 

 

 

(118

)

Income from discontinued operations, net of tax

 

 

 

 

 

 

 

 

 

(390

)

Loss on deconsolidation of subsidiary

 

 

 

 

 

 

 

 

 

19,937

 

Interest expense, net

 

 

 

 

 

 

 

 

 

2,153

 

Operating income

 

$

64,114

 

$

21,447

 

$

8,037

 

$

(23,187

)

$

70,411

 

Depreciation and amortization

 

16,874

 

19,710

 

3,613

 

3,616

 

43,813

 

(Gain) loss on disposition of long-lived asset

 

(2,823

)

 

 

 

(2,823

)

Transaction-related charges

 

 

 

97

 

2,755

 

2,852

 

Adjusted EBITDA

 

$

78,165

 

$

41,157

 

$

11,747

 

$

(16,816

)

$

114,253

 

 

11



 

Table 5

 

ATN International, Inc.

Reconciliation of Non-GAAP Measures

(In Thousands)

 

Reconciliation of Net Income Attributable to ATN International, Inc. Stockholders and Earnings Per Share to Net

Income Attributable to ATN International, Inc. Stockholders Excluding Loss on Deconsolidation of Subsidiary and

Diluted Earnings Per Share for the Three Months Ended September 30, 2015 and 2016

 

Three Months Ended September 30, 2016

 

 

 

Total

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

$

7,171

 

 

 

 

 

Adjustments: None

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders excluding loss on deconsolidation of subsidiary

 

$

7,171

 

 

 

 

 

Net income per weighted average share attributable to ATN International, Inc. stockholder

 

$

0.44

 

 

 

 

 

Adjustments: None

 

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder excluding loss on deconsolidation of subsidiary

 

$

0.44

 

 

Three Months Ended September 30, 2015

 

 

 

Total

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

$

6,576

 

 

 

 

 

Adjustments: None

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders excluding loss on deconsolidation of subsidiary

 

$

6,576

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder

 

$

0.41

 

 

 

 

 

Adjustments: None

 

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder excluding loss on deconsolidation of subsidiary

 

$

0.41

 

 

12



 

ATN International, Inc.

Reconciliation of Non-GAAP Measures

(In Thousands)

 

Reconciliation of Net Income Attributable to ATN International, Inc Stockholders and Earnings Per Share to Net Income Attributable to ATN International, Inc Stockholders Excluding Loss on Deconsolidation of Subsidiary and Diluted Earnings Per Share for the Nine Months ended September 30, 2015 and 2016

 

Nine Months Ended September 30, 2016

 

 

 

Total

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

$

10,206

 

 

 

 

 

Adjustments: None

 

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders excluding loss on deconsolidation of subsidiary, net of tax

 

$

10,206

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder

 

$

0.63

 

 

 

 

 

Adjustments: None

 

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder excluding loss on deconsolidation of subsidiary

 

$

0.63

 

 

Nine Months Ended September 30, 2015

 

 

 

Total

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders

 

$

12,757

 

 

 

 

 

Loss on deconsolidation of subsidiary

 

19,937

 

 

 

 

 

Net income attributable to ATN International, Inc. stockholders excluding loss on deconsolidation of subsidiary

 

$

32,694

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder

 

$

0.79

 

 

 

 

 

Adjustments: loss of deconsolidation of subsidiary

 

1.24

 

 

 

 

 

Diluted net income per weighted average share attributable to ATN International, Inc. stockholder excluding loss on deconsolidation of subsidiary

 

$

2.03

 

 

13