2024 guidance reaffirmed
CHICAGO, Aug. 2, 2024
/PRNewswire/ --
As previously announced, UScellular will hold a
teleconference on August 2, 2024, at 9:00 a.m. CDT. Listen to the call live via
the Events & Presentations page
of investors.uscellular.com.
United States Cellular Corporation (NYSE:USM) reported total
operating revenues of $927 million
for the second quarter of 2024, versus $957
million for the same period one year ago. Service revenues
totaled $743 million, versus
$760 million for the same period one
year ago. Net income attributable to UScellular shareholders and
related diluted earnings per share were $17
million and $0.20,
respectively, for the second quarter of 2024 compared to
$5 million and $0.05, respectively, in the same period one year
ago.
2Q 2024 Highlights*
- Announced sale of wireless operations and select spectrum
assets
- Now reporting Wireless and Towers segments
- Wireless
- Sequential improvement in postpaid gross additions and postpaid
net losses
- Postpaid ARPU grew 2%; service revenues decreased 2%
- Towers
- Third-party tower revenues increased 1%
- Fixed wireless customers grew 40% to 134,000
- Strong cost management across the enterprise led to
increased operating income, net income and Adjusted OIBDA
* Comparisons are 2Q'23 to 2Q'24 unless otherwise noted
"Solid postpaid ARPU growth and continued strong expense
discipline is keeping us on track to deliver on our financial
guidance," said Laurent C. Therivel,
UScellular President and CEO. "We have taken actions to improve
subscriber results that have led to sequential improvement in
postpaid handset net additions in the second quarter. While
postpaid handset net additions remained negative, we are encouraged
by the positive momentum.
"Finally, I would also like to thank all of our associates for
their hard work in these dynamic times. 2024 has been a year of
unprecedented change for the organization, but our team has
remained focused on our mission of connecting customers to what
matters most."
Announced Transaction and Exploration of Strategic
Alternatives for UScellular
On May
28, 2024, Telephone and Data Systems, Inc. (TDS) and
UScellular announced that they have entered into a definitive
agreement to sell UScellular's wireless operations and select
spectrum assets to T-Mobile. The transaction is expected to close
in mid-2025, subject to regulatory approvals and the satisfaction
of customary closing conditions.
UScellular retains its nearly 4,400 owned towers, its equity
method investments, and approximately 70% of its spectrum assets.
The strategic alternatives review process is ongoing as UScellular
seeks to opportunistically monetize its spectrum assets that are
not subject to the T-Mobile transaction.
2024 Estimated Results
UScellular's current estimates of full-year 2024 results are
shown below. Such estimates represent management's view as of
August 2, 2024 and should not be assumed to be current as of
any future date. UScellular 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.
|
2024 Estimated
Results
|
|
Previous
|
Current
|
|
(Dollars in
millions)
|
|
|
|
Service
revenues
|
$2,950-$3,050
|
Unchanged
|
|
Adjusted OIBDA1,
2
|
$750-$850
|
Unchanged
|
|
Adjusted EBITDA1,
2
|
$920-$1,020
|
Unchanged
|
|
Capital
expenditures
|
$550-$650
|
Unchanged
|
|
|
|
The following table reconciles EBITDA, Adjusted EBITDA and
Adjusted OIBDA to the corresponding GAAP measures, Net income or
Income before income taxes. In providing 2024 estimated results,
UScellular has not completed the below reconciliation to Net income
because it does not provide guidance for income taxes. Although
potentially significant, UScellular believes that the impact of
income taxes cannot be reasonably predicted; therefore, UScellular
is unable to provide such guidance.
|
|
|
Actual
Results
|
|
2024 Estimated
Results2
|
|
Six Months
Ended
June 30,
2024
|
|
Year Ended
December 31, 2023
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
Net income
(GAAP)
|
N/A
|
|
$42
|
|
$58
|
|
Add back:
|
|
|
|
|
|
|
Income tax
expense
|
N/A
|
|
41
|
|
53
|
|
Income before income
taxes (GAAP)
|
$60-$160
|
|
$83
|
|
$111
|
|
Add back:
|
|
|
|
|
|
|
Interest
expense
|
185
|
|
91
|
|
196
|
|
Depreciation,
amortization and accretion expense
|
660
|
|
329
|
|
656
|
|
EBITDA
(Non-GAAP)1
|
$905-$1,005
|
|
$503
|
|
$963
|
|
Add back or
deduct:
|
|
|
|
|
|
|
Expenses related to
strategic alternatives review
|
—
|
|
21
|
|
8
|
|
(Gain) loss on asset
disposals, net
|
15
|
|
11
|
|
17
|
|
(Gain) loss on license
sales and exchanges, net
|
—
|
|
7
|
|
(2)
|
|
Adjusted EBITDA
(Non-GAAP)1
|
$920-$1,020
|
|
$542
|
|
$986
|
|
Deduct:
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated entities
|
155
|
|
80
|
|
158
|
|
Interest and dividend
income
|
15
|
|
6
|
|
10
|
|
Adjusted OIBDA
(Non-GAAP)1
|
$750-$850
|
|
$456
|
|
$818
|
|
|
1
|
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. UScellular does not intend to
imply that any such items set forth in the reconciliation above are
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 UScellular's operating
results before significant recurring non-cash charges, nonrecurring
expenses, gains and losses, and other items as presented above as
they provide additional relevant and useful information to
investors and other users of UScellular's 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, gains and losses, and expenses related to the strategic
alternatives review of UScellular 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,
2024, can be found on UScellular's website at
investors.uscellular.com.
|
|
2
|
2024 Estimated Results
do not reflect any anticipated costs, expenses or results of the
strategic alternatives review referenced above.
|
|
|
Conference Call Information
UScellular will hold a
conference call on August 2, 2024 at 9:00 a.m. Central Time.
- Access the live call on the Events & Presentations page of
investors.uscellular.com or at
https://events.q4inc.com/attendee/870908711
- Access the call by phone at (888)330-2384 conference ID:
1328528.
Before the call, certain financial and statistical information
to be discussed during the call will be posted to
investors.uscellular.com. The call will be archived on the Events
& Presentations page of investors.uscellular.com.
About UScellular
United States Cellular Corporation
provides a comprehensive range of wireless products and services,
excellent customer support, and a high-quality network to customers
with 4.5 million retail connections in 21 states. The Chicago-based company had 4,300 full- and
part-time associates as of June 30,
2024. At the end of the second quarter of 2024, Telephone
and Data Systems, Inc. owned approximately 82 percent of
UScellular. For more information about UScellular, visit
uscellular.com.
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: whether the announced transaction whereby
UScellular has agreed to sell its wireless operations and selected
spectrum assets to T-Mobile will be successfully completed or
whether UScellular will be able to find buyers at mutually
agreeable prices for its spectrum assets that are not subject to
the agreement with T-Mobile; whether any such strategic alternative
will result in additional value for UScellular and its shareholders
and whether the process will have an adverse impact on UScellular's
business; strategic decisions regarding the tower business; intense
competition; the ability to attract people of outstanding talent
throughout all levels of the organization; UScellular's smaller
scale relative to larger competitors; the ability to obtain or
maintain roaming arrangements with other carriers on acceptable
terms and changes in roaming practices; the ability to obtain
access to adequate radio spectrum to meet current or anticipated
future needs, including participation in FCC auctions; changes in
demand, consumer preferences and perceptions, price competition, or
churn rates; advances in technology; impacts of costs, integration
problems or other factors associated with acquisitions,
divestitures or exchanges of properties or wireless spectrum
licenses and/or expansion of UScellular's businesses; the ability
of the company to successfully construct and manage its networks;
difficulties involving third parties with which UScellular does
business; uncertainties in UScellular's future cash flows and
liquidity and access to the capital markets; the ability to make
payments on UScellular indebtedness or comply with the terms of
debt covenants; conditions in the U.S. telecommunications industry;
the value of assets and investments; the state and federal
regulatory environment, including changes in regulatory support
received and the ability to pass through regulatory fees to
customers; pending and future litigation; cyber-attacks or other
breaches of network or information technology security; potential
conflicts of interests between TDS and UScellular; disruption in
credit or other financial markets; deterioration of U.S. or global
economic conditions; and the impact, duration and severity of
public health emergencies. Investors are encouraged to consider
these and other risks and uncertainties that are more fully
described under "Risk Factors" in the most recent filing of
UScellular's Form 10-K, as updated by any UScellular Form 10-Q
filed subsequent to such Form 10-K.
For more information about UScellular, visit:
www.uscellular.com
|
|
United States
Cellular Corporation
Summary Operating Data (Unaudited)
|
|
As of or for the
Quarter Ended
|
6/30/2024
|
|
3/31/2024
|
|
12/31/2023
|
|
9/30/2023
|
|
6/30/2023
|
|
Retail
Connections
|
|
|
|
|
|
|
|
|
|
|
Postpaid
|
|
|
|
|
|
|
|
|
|
|
Total at end of
period1
|
4,027,000
|
|
4,051,000
|
|
4,106,000
|
|
4,159,000
|
|
4,194,000
|
|
Gross
additions
|
117,000
|
|
106,000
|
|
129,000
|
|
128,000
|
|
125,000
|
|
Handsets
|
73,000
|
|
63,000
|
|
80,000
|
|
84,000
|
|
83,000
|
|
Connected
devices
|
44,000
|
|
43,000
|
|
49,000
|
|
44,000
|
|
42,000
|
|
Net additions
(losses)1
|
(24,000)
|
|
(44,000)
|
|
(50,000)
|
|
(35,000)
|
|
(28,000)
|
|
Handsets
|
(29,000)
|
|
(47,000)
|
|
(53,000)
|
|
(38,000)
|
|
(29,000)
|
|
Connected
devices
|
5,000
|
|
3,000
|
|
3,000
|
|
3,000
|
|
1,000
|
|
ARPU2
|
$
51.45
|
|
$
51.96
|
|
$
51.61
|
|
$
51.11
|
|
$
50.64
|
|
ARPA3
|
$
130.41
|
|
$ 132.00
|
|
$ 131.63
|
|
$
130.91
|
|
$
130.19
|
|
Handset upgrade
rate4
|
4.1 %
|
|
4.5 %
|
|
5.8 %
|
|
4.5 %
|
|
4.8 %
|
|
Churn
rate5
|
1.16 %
|
|
1.22 %
|
|
1.44 %
|
|
1.30 %
|
|
1.21 %
|
|
Handsets
|
0.97 %
|
|
1.03 %
|
|
1.22 %
|
|
1.11 %
|
|
1.01 %
|
|
Connected
devices
|
2.47 %
|
|
2.52 %
|
|
3.03 %
|
|
2.64 %
|
|
2.65 %
|
|
Prepaid
|
|
|
|
|
|
|
|
|
|
|
Total at end of
period1
|
439,000
|
|
436,000
|
|
451,000
|
|
462,000
|
|
462,000
|
|
Gross
additions
|
50,000
|
|
41,000
|
|
43,000
|
|
52,000
|
|
50,000
|
|
Net additions
(losses)1
|
3,000
|
|
(13,000)
|
|
(11,000)
|
|
—
|
|
(8,000)
|
|
ARPU2,
6
|
$
32.37
|
|
$
32.25
|
|
$
32.32
|
|
$
33.44
|
|
$
33.86
|
|
Churn
rate5
|
3.60 %
|
|
4.06 %
|
|
3.87 %
|
|
3.68 %
|
|
4.18 %
|
|
Market penetration
at end of period
|
|
|
|
|
|
|
|
|
|
|
Consolidated operating
population
|
32,550,000
|
|
32,550,000
|
|
32,350,000
|
|
32,350,000
|
|
32,350,000
|
|
Consolidated operating
penetration7
|
15 %
|
|
14 %
|
|
15 %
|
|
15 %
|
|
15 %
|
|
Capital expenditures
(millions)
|
$
165
|
|
$
131
|
|
$
148
|
|
$
111
|
|
$
143
|
|
Total cell sites in
service
|
6,990
|
|
6,995
|
|
7,000
|
|
6,973
|
|
6,952
|
|
Owned
towers
|
4,388
|
|
4,382
|
|
4,373
|
|
4,356
|
|
4,341
|
|
|
|
1
|
First quarter 2024
connections were adjusted to remove subscribers that could no
longer access the UScellular network due to the CDMA shutdown. This
resulted in 11,000 and 2,000 subscribers removed from the postpaid
and prepaid base, respectively, that are not included in Net
additions (losses) for the quarter.
|
|
2
|
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.
|
|
3
|
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.
|
|
4
|
Handset upgrade rate
calculated as total handset upgrade transactions divided by average
postpaid handset connections.
|
|
5
|
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.
|
|
6
|
Fourth quarter 2023
Prepaid ARPU excludes a $6 million reduction of prepaid revenue
related to an adjustment to correct a prior period error recorded
in the fourth quarter of 2023.
|
|
7
|
Market penetration is
calculated by dividing the number of wireless connections at the
end of the period by the total estimated population of consolidated
operating markets.
|
|
United States
Cellular Corporation
Consolidated Statement of Operations Highlights
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
June
30,
|
|
Six Months
Ended
June
30,
|
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
(Dollars and shares in
millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
$ 743
|
|
$ 760
|
|
(2) %
|
|
$
1,497
|
|
$
1,527
|
|
(2) %
|
|
Equipment
sales
|
184
|
|
197
|
|
(6) %
|
|
380
|
|
415
|
|
(9) %
|
|
Total operating
revenues
|
927
|
|
957
|
|
(3) %
|
|
1,877
|
|
1,942
|
|
(3) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
System operations
(excluding Depreciation, amortization and
accretion reported below)
|
180
|
|
190
|
|
(5) %
|
|
362
|
|
372
|
|
(3) %
|
|
Cost of equipment
sold
|
211
|
|
228
|
|
(7) %
|
|
427
|
|
480
|
|
(11) %
|
|
Selling, general and
administrative
|
322
|
|
341
|
|
(5) %
|
|
653
|
|
686
|
|
(5) %
|
|
Depreciation,
amortization and accretion
|
165
|
|
161
|
|
2 %
|
|
329
|
|
330
|
|
—
|
|
(Gain) loss on asset
disposals, net
|
5
|
|
3
|
|
49 %
|
|
11
|
|
13
|
|
(19) %
|
|
(Gain) loss on license
sales and exchanges, net
|
8
|
|
—
|
|
N/M
|
|
7
|
|
—
|
|
N/M
|
|
Total operating
expenses
|
891
|
|
923
|
|
(3) %
|
|
1,789
|
|
1,881
|
|
(5) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
36
|
|
34
|
|
6 %
|
|
88
|
|
61
|
|
44 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment and other
income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated entities
|
38
|
|
38
|
|
2 %
|
|
80
|
|
82
|
|
(2) %
|
|
Interest and dividend
income
|
3
|
|
3
|
|
18 %
|
|
6
|
|
5
|
|
11 %
|
|
Interest
expense
|
(45)
|
|
(51)
|
|
8 %
|
|
(91)
|
|
(99)
|
|
8 %
|
|
Total investment and
other expense
|
(4)
|
|
(10)
|
|
54 %
|
|
(5)
|
|
(12)
|
|
61 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
32
|
|
24
|
|
31 %
|
|
83
|
|
49
|
|
69 %
|
|
Income tax
expense
|
14
|
|
19
|
|
(28) %
|
|
41
|
|
29
|
|
41 %
|
|
Net
income
|
18
|
|
5
|
|
N/M
|
|
42
|
|
20
|
|
N/M
|
|
Less: Net income
attributable to noncontrolling interests, net of tax
|
1
|
|
—
|
|
(20) %
|
|
7
|
|
2
|
|
N/M
|
|
Net income
attributable to UScellular shareholders
|
$
17
|
|
$
5
|
|
N/M
|
|
$
35
|
|
$
18
|
|
N/M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average shares outstanding
|
86
|
|
85
|
|
1 %
|
|
86
|
|
85
|
|
1 %
|
|
Basic earnings per
share attributable to UScellular shareholders
|
$
0.20
|
|
$
0.05
|
|
N/M
|
|
$
0.41
|
|
$
0.21
|
|
99 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
88
|
|
86
|
|
3 %
|
|
88
|
|
86
|
|
2 %
|
|
Diluted earnings per
share attributable to UScellular
shareholders
|
$
0.20
|
|
$
0.05
|
|
N/M
|
|
$
0.40
|
|
$
0.20
|
|
95 %
|
|
N/M - Percentage change
not meaningful
|
|
United States
Cellular Corporation
Consolidated Statement of Cash Flows
(Unaudited)
|
|
|
Six Months
Ended
June
30,
|
|
2024
|
|
2023
|
|
(Dollars in
millions)
|
|
|
|
|
Cash flows from
operating activities
|
|
|
|
|
Net income
|
$
42
|
|
$
20
|
|
Add (deduct)
adjustments to reconcile net income to net cash flows from
operating activities
|
|
|
|
|
Depreciation,
amortization and accretion
|
329
|
|
330
|
|
Bad debts
expense
|
46
|
|
50
|
|
Stock-based
compensation expense
|
25
|
|
6
|
|
Deferred income taxes,
net
|
11
|
|
25
|
|
Equity in earnings of
unconsolidated entities
|
(80)
|
|
(82)
|
|
Distributions from
unconsolidated entities
|
80
|
|
78
|
|
(Gain) loss on asset
disposals, net
|
11
|
|
13
|
|
(Gain) loss on license
sales and exchanges, net
|
7
|
|
—
|
|
Other operating
activities
|
3
|
|
3
|
|
Changes in assets and
liabilities from operations
|
|
|
|
|
Accounts
receivable
|
(1)
|
|
35
|
|
Equipment installment
plans receivable
|
5
|
|
7
|
|
Inventory
|
57
|
|
52
|
|
Accounts
payable
|
—
|
|
(106)
|
|
Customer deposits and
deferred revenues
|
6
|
|
(9)
|
|
Accrued
taxes
|
20
|
|
1
|
|
Accrued
interest
|
(1)
|
|
(1)
|
|
Other assets and
liabilities
|
(44)
|
|
(32)
|
|
Net cash provided by
operating activities
|
516
|
|
390
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
|
Cash paid for
additions to property, plant and equipment
|
(270)
|
|
(351)
|
|
Cash paid for
licenses
|
(15)
|
|
(8)
|
|
Other investing
activities
|
1
|
|
14
|
|
Net cash used in
investing activities
|
(284)
|
|
(345)
|
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
|
Issuance of long-term
debt
|
40
|
|
115
|
|
Repayment of long-term
debt
|
(198)
|
|
(156)
|
|
Repayment of
short-term debt
|
—
|
|
(60)
|
|
Tax payments for
stock-based compensation awards
|
(12)
|
|
(6)
|
|
Distributions to
noncontrolling interests
|
(3)
|
|
(2)
|
|
Cash paid for software
license agreements
|
(20)
|
|
(19)
|
|
Other financing
activities
|
(3)
|
|
(1)
|
|
Net cash used in
financing activities
|
(196)
|
|
(129)
|
|
|
|
|
|
Net increase
(decrease) in cash, cash equivalents and restricted
cash
|
36
|
|
(84)
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash
|
|
|
|
|
Beginning of
period
|
179
|
|
308
|
|
End of
period
|
$
215
|
|
$
224
|
|
United States
Cellular Corporation
Consolidated Balance Sheet Highlights
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
|
June 30,
2024
|
|
December 31,
2023
|
|
(Dollars in
millions)
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
$
195
|
|
$
150
|
|
Accounts receivable,
net
|
952
|
|
957
|
|
Inventory,
net
|
143
|
|
199
|
|
Prepaid
expenses
|
58
|
|
57
|
|
Income taxes
receivable
|
—
|
|
1
|
|
Other current
assets
|
26
|
|
36
|
|
Total current
assets
|
1,374
|
|
1,400
|
|
|
|
|
|
Assets held for
sale
|
—
|
|
15
|
|
|
|
|
|
Licenses
|
4,715
|
|
4,693
|
|
|
|
|
|
Investments in
unconsolidated entities
|
461
|
|
461
|
|
|
|
|
|
Property, plant and
equipment, net
|
2,540
|
|
2,576
|
|
|
|
|
|
Operating lease
right-of-use assets
|
906
|
|
915
|
|
|
|
|
|
Other assets and
deferred charges
|
643
|
|
690
|
|
|
|
|
|
Total
assets
|
$
10,639
|
|
$
10,750
|
|
United States
Cellular Corporation
Consolidated Balance Sheet Highlights
(Unaudited)
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
June 30,
2024
|
|
December 31,
2023
|
|
(Dollars in millions,
except per share amounts)
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Current portion of
long-term debt
|
$
20
|
|
$
20
|
|
Accounts
payable
|
268
|
|
248
|
|
Customer deposits and
deferred revenues
|
236
|
|
229
|
|
Accrued
taxes
|
41
|
|
32
|
|
Accrued
compensation
|
57
|
|
83
|
|
Short-term operating
lease liabilities
|
134
|
|
135
|
|
Other current
liabilities
|
130
|
|
154
|
|
Total current
liabilities
|
886
|
|
901
|
|
|
|
|
|
Deferred liabilities
and credits
|
|
|
|
|
Deferred income tax
liability, net
|
765
|
|
755
|
|
Long-term operating
lease liabilities
|
822
|
|
831
|
|
Other deferred
liabilities and credits
|
573
|
|
565
|
|
|
|
|
|
Long-term debt,
net
|
2,887
|
|
3,044
|
|
|
|
|
|
Noncontrolling
interests with redemption features
|
16
|
|
12
|
|
|
|
|
|
Equity
|
|
|
|
|
UScellular
shareholders' equity
|
|
|
|
|
Series A Common and
Common Shares, par value $1.00 per share
|
88
|
|
88
|
|
Additional paid-in
capital
|
1,752
|
|
1,726
|
|
Treasury
shares
|
(58)
|
|
(80)
|
|
Retained
earnings
|
2,893
|
|
2,892
|
|
Total UScellular
shareholders' equity
|
4,675
|
|
4,626
|
|
|
|
|
|
Noncontrolling
interests
|
15
|
|
16
|
|
|
|
|
|
Total
equity
|
4,690
|
|
4,642
|
|
|
|
|
|
Total liabilities
and equity
|
$
10,639
|
|
$
10,750
|
|
United States
Cellular Corporation
Segment
Results
(Unaudited)
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
UScellular
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Wireless
|
$ 902
|
|
$ 932
|
|
(3) %
|
|
$
1,826
|
|
$
1,892
|
|
(3) %
|
|
Towers
|
58
|
|
57
|
|
3 %
|
|
116
|
|
113
|
|
3 %
|
|
Intra-company
eliminations
|
(33)
|
|
(32)
|
|
(4) %
|
|
(65)
|
|
(63)
|
|
(3) %
|
|
Total operating
revenues
|
927
|
|
957
|
|
(3) %
|
|
1,877
|
|
1,942
|
|
(3) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Wireless
|
885
|
|
916
|
|
(3) %
|
|
1,779
|
|
1,868
|
|
(5) %
|
|
Towers
|
39
|
|
39
|
|
1 %
|
|
75
|
|
76
|
|
(1) %
|
|
Intra-company
eliminations
|
(33)
|
|
(32)
|
|
(4) %
|
|
(65)
|
|
(63)
|
|
(3) %
|
|
Total operating
expenses
|
891
|
|
923
|
|
(3) %
|
|
1,789
|
|
1,881
|
|
(5) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$
36
|
|
$
34
|
|
6 %
|
|
$
88
|
|
$
61
|
|
44 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted OIBDA
(Non-GAAP)
|
$ 227
|
|
$ 198
|
|
14 %
|
|
$ 456
|
|
$ 404
|
|
13 %
|
|
Adjusted EBITDA
(Non-GAAP)
|
$ 268
|
|
$ 239
|
|
13 %
|
|
$ 542
|
|
$ 491
|
|
10 %
|
|
Capital
expenditures
|
$ 165
|
|
$ 143
|
|
15 %
|
|
$ 295
|
|
$ 351
|
|
(16) %
|
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
UScellular
Wireless
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail
service
|
$ 666
|
|
$ 686
|
|
(3) %
|
|
$
1,344
|
|
$
1,378
|
|
(2) %
|
|
Other
|
52
|
|
49
|
|
7 %
|
|
102
|
|
99
|
|
3 %
|
|
Service
revenues
|
718
|
|
735
|
|
(2) %
|
|
1,446
|
|
1,477
|
|
(2) %
|
|
Equipment
sales
|
184
|
|
197
|
|
(6) %
|
|
380
|
|
415
|
|
(9) %
|
|
Total operating
revenues
|
902
|
|
932
|
|
(3) %
|
|
1,826
|
|
1,892
|
|
(3) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
System operations
(excluding Depreciation, amortization and accretion
reported below)
|
194
|
|
203
|
|
(4) %
|
|
390
|
|
398
|
|
(2) %
|
|
Cost of equipment
sold
|
211
|
|
228
|
|
(7) %
|
|
427
|
|
480
|
|
(11) %
|
|
Selling, general and
administrative
|
313
|
|
333
|
|
(6) %
|
|
637
|
|
670
|
|
(5) %
|
|
Depreciation,
amortization and accretion
|
154
|
|
149
|
|
3 %
|
|
308
|
|
307
|
|
—
|
|
(Gain) loss on asset
disposals, net
|
5
|
|
3
|
|
40 %
|
|
10
|
|
13
|
|
(23) %
|
|
(Gain) loss on license
sales and exchanges, net
|
8
|
|
—
|
|
N/M
|
|
7
|
|
—
|
|
N/M
|
|
Total operating
expenses
|
885
|
|
916
|
|
(3) %
|
|
1,779
|
|
1,868
|
|
(5) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$
17
|
|
$
16
|
|
5 %
|
|
$
47
|
|
$
24
|
|
97 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted OIBDA
(Non-GAAP)
|
$ 196
|
|
$ 168
|
|
16 %
|
|
$ 392
|
|
$ 344
|
|
14 %
|
|
Adjusted EBITDA
(Non-GAAP)
|
$ 196
|
|
$ 168
|
|
16 %
|
|
$ 392
|
|
$ 344
|
|
14 %
|
|
Capital
expenditures
|
$ 160
|
|
$ 140
|
|
13 %
|
|
$ 286
|
|
$ 346
|
|
(17) %
|
|
N/M - Percentage change
not meaningful
|
|
United States
Cellular Corporation
Segment
Results
(Unaudited)
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
UScellular
Towers
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
2024
|
|
2023
|
|
2024
vs. 2023
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Third-party
revenues
|
$
25
|
|
$
25
|
|
1 %
|
|
$
51
|
|
$
50
|
|
2 %
|
|
Intra-company
revenues
|
33
|
|
32
|
|
4 %
|
|
65
|
|
63
|
|
3 %
|
|
Total tower
revenues
|
58
|
|
57
|
|
3 %
|
|
116
|
|
113
|
|
3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
System operations
(excluding Depreciation, amortization and accretion
reported below)
|
19
|
|
19
|
|
(1) %
|
|
37
|
|
37
|
|
1 %
|
|
Selling, general and
administrative
|
9
|
|
8
|
|
8 %
|
|
16
|
|
16
|
|
(3) %
|
|
Depreciation,
amortization and accretion
|
11
|
|
12
|
|
(5) %
|
|
21
|
|
23
|
|
(5) %
|
|
(Gain) loss on asset
disposals, net
|
—
|
|
—
|
|
N/M
|
|
1
|
|
—
|
|
N/M
|
|
Total operating
expenses
|
39
|
|
39
|
|
1 %
|
|
75
|
|
76
|
|
(1) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$
19
|
|
$
18
|
|
7 %
|
|
$
41
|
|
$
37
|
|
10 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted OIBDA
(Non-GAAP)
|
$
31
|
|
$
30
|
|
6 %
|
|
$
64
|
|
$
60
|
|
7 %
|
|
Adjusted EBITDA
(Non-GAAP)
|
$
31
|
|
$
30
|
|
6 %
|
|
$
64
|
|
$
60
|
|
7 %
|
|
Capital
expenditures
|
$
5
|
|
$
3
|
|
N/M
|
|
$
9
|
|
$
5
|
|
89 %
|
|
N/M - Percentage change
not meaningful
|
|
United States
Cellular Corporation
Free Cash
Flow
(Unaudited)
|
|
|
Three Months
Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
UScellular
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities (GAAP)
|
$
313
|
|
$
349
|
|
$
516
|
|
$
390
|
|
Cash paid for additions
to property, plant and equipment
|
(137)
|
|
(155)
|
|
(270)
|
|
(351)
|
|
Cash paid for software
license agreements
|
(11)
|
|
(12)
|
|
(20)
|
|
(19)
|
|
Free cash flow
(Non-GAAP)1
|
$
165
|
|
$
182
|
|
$
226
|
|
$
20
|
|
|
|
1
|
Free cash flow is a
non-GAAP financial measure which UScellular 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 and Cash paid for
software license agreements.
|
|
United States
Cellular Corporation
EBITDA, Adjusted EBITDA and
Adjusted OIBDA
(Unaudited)
|
|
The following tables
reconcile EBITDA, Adjusted EBITDA and Adjusted OIBDA to the
corresponding GAAP measures, Net income,
Income before income taxes and/or Operating income. Income and
expense items below Operating Income are not provided at the
individual segment level for UScellular Wireless and UScellular
Towers; therefore, the reconciliations begin with EBITDA and the
most
directly comparable GAAP measure is Operating income rather than
Net income at the segment level.
|
|
|
Three Months
Ended
June 30,
|
|
UScellular
|
2024
|
|
2023
|
|
(Dollars in
millions)
|
|
|
|
|
Net income
(GAAP)
|
$
18
|
|
$
5
|
|
Add back:
|
|
|
|
|
Income tax
expense
|
14
|
|
19
|
|
Income before income
taxes (GAAP)
|
32
|
|
24
|
|
Add back:
|
|
|
|
|
Interest
expense
|
45
|
|
51
|
|
Depreciation,
amortization and accretion
|
165
|
|
161
|
|
EBITDA
(Non-GAAP)
|
242
|
|
236
|
|
Add back or
deduct:
|
|
|
|
|
Expenses related to
strategic alternatives review
|
13
|
|
—
|
|
(Gain) loss on asset
disposals, net
|
5
|
|
3
|
|
(Gain) loss on license
sales and exchanges, net
|
8
|
|
—
|
|
Adjusted EBITDA
(Non-GAAP)
|
268
|
|
239
|
|
Deduct:
|
|
|
|
|
Equity in earnings of
unconsolidated entities
|
38
|
|
38
|
|
Interest and dividend
income
|
3
|
|
3
|
|
Adjusted OIBDA
(Non-GAAP)
|
$
227
|
|
$
198
|
|
|
|
Three Months
Ended
June 30,
|
|
UScellular
Wireless
|
2024
|
|
2023
|
|
(Dollars in
millions)
|
|
|
|
|
EBITDA
(Non-GAAP)
|
$
171
|
|
$
165
|
|
Add back or
deduct:
|
|
|
|
|
Expenses related to
strategic alternatives review
|
12
|
|
—
|
|
(Gain) loss on asset
disposals, net
|
5
|
|
3
|
|
(Gain) loss on license
sales and exchanges, net
|
8
|
|
—
|
|
Adjusted EBITDA and
Adjusted OIBDA (Non-GAAP)
|
196
|
|
168
|
|
Deduct:
|
|
|
|
|
Depreciation,
amortization and accretion
|
154
|
|
149
|
|
Expenses related to
strategic alternatives review
|
12
|
|
—
|
|
(Gain) loss on asset
disposals, net
|
5
|
|
3
|
|
(Gain) loss on license
sales and exchanges, net
|
8
|
|
—
|
|
Operating income
(GAAP)
|
$
17
|
|
$
16
|
|
|
|
EBITDA, Adjusted
EBITDA and Adjusted OIBDA
|
|
Three Months
Ended
June 30,
|
|
UScellular
Towers
|
2024
|
|
2023
|
|
(Dollars in
millions)
|
|
|
|
|
EBITDA
(Non-GAAP)
|
$
30
|
|
$
30
|
|
Add back or
deduct:
|
|
|
|
|
Expenses related to
strategic alternatives review
|
1
|
|
—
|
|
Adjusted EBITDA and
Adjusted OIBDA (Non-GAAP)
|
31
|
|
30
|
|
Deduct:
|
|
|
|
|
Depreciation,
amortization and accretion
|
11
|
|
12
|
|
Expenses related to
strategic alternatives review
|
1
|
|
—
|
|
Operating income
(GAAP)
|
$
19
|
|
$
18
|
View original
content:https://www.prnewswire.com/news-releases/uscellular-reports-second-quarter-2024-results-302213065.html
SOURCE United States Cellular Corporation