CHICAGO, Aug. 5, 2021 /PRNewswire/ --
As previously announced, UScellular will hold a
teleconference August 6, 2021, 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 $1,014 million
for the second quarter of 2021, versus $973
million for the same period one year ago. Service revenues
totaled $774 million, versus
$753 million for the same period a
year ago. Net income attributable to UScellular shareholders and
related diluted earnings per share were $35
million and $0.39,
respectively, for the second quarter of 2021 compared to
$68 million and $0.78, respectively, in the same period one year
ago.
"UScellular continued strong growth in service revenue and made
meaningful progress towards our strategic priorities," said
Laurent Therivel, UScellular
President and CEO. "Higher postpaid ARPU helped drive service
revenue growth as customers chose higher-value plans.
"Our efforts to expand our prepaid business are starting to
generate positive results, and our business-and-government
initiatives are laying the foundation for future growth. With the
competitive environment top of mind, we are continuing to execute
our community-by-community strategy in order to deliver solutions
that are right for our customers.
"Our 5G and network modernization programs are on track. We
continue to be very optimistic on the performance capabilities of
mmWave spectrum. Additionally, the 5G fixed wireless access tests
of market demand have seen early, encouraging results and will
provide valuable learnings as we look to bring this high-speed
product to market.
"I continue to be impressed with the hard work of our associates
and their commitment to keeping our customers connected. I'd like
to thank all of them for their contributions this quarter."
2021 Estimated Results
UScellular's current estimates of full-year 2021 results are
shown below. Such estimates represent management's view as of
August 5, 2021 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.
|
2021 Estimated
Results
|
|
Previous
|
Current
|
(Dollars in
millions)
|
|
|
Service
revenues
|
$3,050-$3,150
|
Unchanged
|
Adjusted
OIBDA1
|
$850-$950
|
Unchanged
|
Adjusted
EBITDA1
|
$1,025-$1,125
|
Unchanged
|
Capital
expenditures
|
$775-$875
|
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 2021 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
|
|
2021 Estimated
Results
|
|
Six Months
Ended
June 30,
2021
|
|
Year Ended
December 31, 2020
|
(Dollars in
millions)
|
|
|
|
|
|
Net income
(GAAP)
|
N/A
|
|
|
$
|
97
|
|
|
$
|
233
|
|
Add back:
|
|
|
|
|
|
Income tax
expense
|
N/A
|
|
|
17
|
|
|
17
|
|
Income before
income taxes (GAAP)
|
$125-$225
|
|
|
$
|
114
|
|
|
$
|
250
|
|
Add back:
|
|
|
|
|
|
Interest
expense
|
180
|
|
|
97
|
|
|
112
|
|
Depreciation,
amortization and accretion expense
|
700
|
|
|
350
|
|
|
683
|
|
EBITDA
(Non-GAAP)1
|
$1,005-$1,105
|
|
|
$
|
561
|
|
|
$
|
1,045
|
|
Add back or
deduct:
|
|
|
|
|
|
(Gain) loss on asset
disposals, net
|
20
|
|
|
7
|
|
|
25
|
|
(Gain) loss on sale of
business and other exit costs, net
|
—
|
|
|
(1)
|
|
|
—
|
|
(Gain) loss on license
sales and exchanges, net
|
—
|
|
|
—
|
|
|
(5)
|
|
(Gain) loss on
investments
|
—
|
|
|
—
|
|
|
(2)
|
|
Adjusted EBITDA
(Non-GAAP)1
|
$1,025-$1,125
|
|
|
$
|
567
|
|
|
$
|
1,063
|
|
Deduct:
|
|
|
|
|
|
Equity in earnings of
unconsolidated entities
|
170
|
|
|
88
|
|
|
179
|
|
Interest and dividend
income
|
5
|
|
|
3
|
|
|
8
|
|
Adjusted OIBDA
(Non-GAAP)1
|
$850-$950
|
|
|
$
|
476
|
|
|
$
|
876
|
|
|
|
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 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
UScellular's 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 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, 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,
2021, can be found on UScellular's website at
investors.uscellular.com.
|
Conference Call Information
UScellular will hold a
conference call on August 6, 2021 at 9:00 a.m. Central Time.
- Access the live call on the Events &
Presentations page of investors.uscellular.com or
at
https://event.on24.com/wcc/r/3332389/4AA81608B2125409E9D3E06EB6B1A284
- Access the call by phone at (833) 968-2187, conference ID:
2249545.
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 5.0 million connections in 21 states. The Chicago-based company employed approximately
5,000 associates as of June 30, 2021.
At the end of the second quarter of 2021, Telephone and Data
Systems, Inc. owned 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: intense competition; the ability to obtain or
maintain roaming arrangements with other carriers on acceptable
terms; the ability to obtain access to adequate radio spectrum to
meet current or anticipated future needs, including participation
in FCC auctions; the ability to attract people of outstanding
talent throughout all levels of the organization; UScellular's
smaller scale relative to larger competitors; 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; 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; pending and future
litigation; potential conflicts of interests between TDS and
UScellular; cyber-attacks or other breaches of network or
information technology security; disruption in credit or other
financial markets; deterioration of U.S. or global economic
conditions; the impact, duration and severity of public health
emergencies, such as the COVID-19 pandemic. 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
|
6/30/2021
|
|
3/31/2021
|
|
12/31/2020
|
|
9/30/2020
|
|
6/30/2020
|
Retail
Connections
|
|
|
|
|
|
|
|
|
|
Postpaid
|
|
|
|
|
|
|
|
|
|
Total at end of
period
|
4,399,000
|
|
|
4,406,000
|
|
|
4,412,000
|
|
|
4,401,000
|
|
|
4,372,000
|
|
Gross
additions
|
141,000
|
|
|
143,000
|
|
|
171,000
|
|
|
168,000
|
|
|
129,000
|
|
Feature
phones
|
3,000
|
|
|
3,000
|
|
|
2,000
|
|
|
4,000
|
|
|
3,000
|
|
Smartphones
|
98,000
|
|
|
101,000
|
|
|
117,000
|
|
|
98,000
|
|
|
82,000
|
|
Connected
devices
|
40,000
|
|
|
39,000
|
|
|
52,000
|
|
|
66,000
|
|
|
44,000
|
|
Net additions
(losses)
|
(6,000)
|
|
|
(6,000)
|
|
|
11,000
|
|
|
28,000
|
|
|
12,000
|
|
Feature
phones
|
(7,000)
|
|
|
(9,000)
|
|
|
(9,000)
|
|
|
(8,000)
|
|
|
(8,000)
|
|
Smartphones
|
6,000
|
|
|
6,000
|
|
|
12,000
|
|
|
8,000
|
|
|
11,000
|
|
Connected
devices
|
(5,000)
|
|
|
(3,000)
|
|
|
8,000
|
|
|
28,000
|
|
|
9,000
|
|
ARPU1
|
$
|
47.74
|
|
|
$
|
47.65
|
|
|
$
|
47.51
|
|
|
$
|
47.10
|
|
|
$
|
46.24
|
|
ARPA2
|
$
|
125.25
|
|
|
$
|
125.25
|
|
|
$
|
124.87
|
|
|
$
|
123.27
|
|
|
$
|
120.70
|
|
Churn
rate3
|
1.11
|
%
|
|
1.12
|
%
|
|
1.21
|
%
|
|
1.06
|
%
|
|
0.89
|
%
|
Handsets
|
0.88
|
%
|
|
0.92
|
%
|
|
1.01
|
%
|
|
0.88
|
%
|
|
0.71
|
%
|
Connected
devices
|
2.69
|
%
|
|
2.53
|
%
|
|
2.64
|
%
|
|
2.35
|
%
|
|
2.24
|
%
|
Prepaid
|
|
|
|
|
|
|
|
|
|
Total at end of
period
|
507,000
|
|
|
496,000
|
|
|
499,000
|
|
|
506,000
|
|
|
496,000
|
|
Gross
additions
|
65,000
|
|
|
62,000
|
|
|
56,000
|
|
|
65,000
|
|
|
62,000
|
|
Net additions
(losses)
|
10,000
|
|
|
(3,000)
|
|
|
(8,000)
|
|
|
11,000
|
|
|
2,000
|
|
ARPU1
|
$
|
35.64
|
|
|
$
|
35.25
|
|
|
$
|
35.15
|
|
|
$
|
35.45
|
|
|
$
|
34.89
|
|
Churn
rate3
|
3.66
|
%
|
|
4.37
|
%
|
|
4.24
|
%
|
|
3.59
|
%
|
|
4.05
|
%
|
Total connections
at end of period4
|
4,967,000
|
|
|
4,961,000
|
|
|
4,968,000
|
|
|
4,962,000
|
|
|
4,919,000
|
|
Market penetration
at end of period
|
|
|
|
|
|
|
|
|
|
Consolidated operating
population
|
31,493,000
|
|
|
31,493,000
|
|
|
31,314,000
|
|
|
31,314,000
|
|
|
31,292,000
|
|
Consolidated operating
penetration5
|
16
|
%
|
|
16
|
%
|
|
16
|
%
|
|
16
|
%
|
|
16
|
%
|
Capital
expenditures (millions)
|
$
|
148
|
|
|
$
|
125
|
|
|
$
|
320
|
|
|
$
|
216
|
|
|
$
|
168
|
|
Total cell sites
in service
|
6,819
|
|
|
6,802
|
|
|
6,797
|
|
|
6,758
|
|
|
6,673
|
|
Owned
towers
|
4,278
|
|
|
4,270
|
|
|
4,271
|
|
|
4,246
|
|
|
4,208
|
|
|
|
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 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,
|
|
2021
|
|
2020
|
|
2021
vs. 2020
|
|
2021
|
|
2020
|
|
2021
vs. 2020
|
(Dollars and shares
in millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
$
|
774
|
|
|
$
|
753
|
|
|
3
|
%
|
|
$
|
1,545
|
|
|
$
|
1,515
|
|
|
2
|
%
|
Equipment
sales
|
240
|
|
|
220
|
|
|
9
|
%
|
|
492
|
|
|
422
|
|
|
17
|
%
|
Total operating
revenues
|
1,014
|
|
|
973
|
|
|
4
|
%
|
|
2,037
|
|
|
1,937
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
System operations
(excluding Depreciation, amortization and accretion reported
below)
|
204
|
|
|
197
|
|
|
4
|
%
|
|
389
|
|
|
377
|
|
|
3
|
%
|
Cost of equipment
sold
|
258
|
|
|
218
|
|
|
19
|
%
|
|
533
|
|
|
435
|
|
|
23
|
%
|
Selling, general and
administrative
|
334
|
|
|
323
|
|
|
3
|
%
|
|
639
|
|
|
659
|
|
|
(3)
|
%
|
Depreciation,
amortization and accretion
|
180
|
|
|
178
|
|
|
1
|
%
|
|
350
|
|
|
354
|
|
|
(2)
|
%
|
(Gain) loss on asset
disposals, net
|
2
|
|
|
4
|
|
|
(50)
|
%
|
|
7
|
|
|
8
|
|
|
(9)
|
%
|
(Gain) loss on sale of
business and other exit costs, net
|
—
|
|
|
—
|
|
|
N/M
|
|
(1)
|
|
|
—
|
|
|
N/M
|
Total operating
expenses
|
978
|
|
|
920
|
|
|
6
|
%
|
|
1,917
|
|
|
1,833
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
36
|
|
|
53
|
|
|
(32)
|
%
|
|
120
|
|
|
104
|
|
|
16
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment and
other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated entities
|
47
|
|
|
44
|
|
|
7
|
%
|
|
88
|
|
|
89
|
|
|
–
|
Interest and dividend
income
|
2
|
|
|
1
|
|
|
54
|
%
|
|
3
|
|
|
5
|
|
|
(30)
|
%
|
Interest
expense
|
(60)
|
|
|
(25)
|
|
|
N/M
|
|
(97)
|
|
|
(49)
|
|
|
N/M
|
Total investment and
other income (expense)
|
(11)
|
|
|
20
|
|
|
N/M
|
|
(6)
|
|
|
45
|
|
|
N/M
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
25
|
|
|
73
|
|
|
(66)
|
%
|
|
114
|
|
|
149
|
|
|
(24)
|
%
|
Income tax expense
(benefit)
|
(10)
|
|
|
4
|
|
|
N/M
|
|
17
|
|
|
8
|
|
|
N/M
|
Net
income
|
35
|
|
|
69
|
|
|
(49)
|
%
|
|
97
|
|
|
141
|
|
|
(31)
|
%
|
Less: Net income
attributable to noncontrolling interests, net of tax
|
—
|
|
|
1
|
|
|
(2)
|
%
|
|
2
|
|
|
2
|
|
|
16
|
%
|
Net income
attributable to UScellular shareholders
|
$
|
35
|
|
|
$
|
68
|
|
|
(49)
|
%
|
|
$
|
95
|
|
|
$
|
139
|
|
|
(32)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average shares outstanding
|
87
|
|
|
86
|
|
|
1
|
%
|
|
87
|
|
|
86
|
|
|
–
|
Basic earnings per
share attributable to UScellular shareholders
|
$
|
0.40
|
|
|
$
|
0.79
|
|
|
(50)
|
%
|
|
$
|
1.10
|
|
|
$
|
1.62
|
|
|
(32)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
88
|
|
|
87
|
|
|
1
|
%
|
|
88
|
|
|
87
|
|
|
–
|
Diluted earnings
per share attributable to UScellular shareholders
|
$
|
0.39
|
|
|
$
|
0.78
|
|
|
(50)
|
%
|
|
$
|
1.08
|
|
|
$
|
1.59
|
|
|
(32)
|
%
|
|
N/M - Percentage
change not meaningful
|
United States
Cellular Corporation
|
Consolidated
Balance Sheet Highlights
|
(Unaudited)
|
|
ASSETS
|
|
|
|
|
|
June 30,
2021
|
|
December 31,
2020
|
(Dollars in
millions)
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
267
|
|
|
$
|
1,271
|
|
Short-term
investments
|
—
|
|
|
3
|
|
Accounts receivable,
net
|
974
|
|
|
998
|
|
Inventory,
net
|
183
|
|
|
146
|
|
Prepaid
expenses
|
55
|
|
|
51
|
|
Income taxes
receivable
|
126
|
|
|
125
|
|
Other current
assets
|
40
|
|
|
29
|
|
Total current
assets
|
1,645
|
|
|
2,623
|
|
|
|
|
|
Assets held for
sale
|
3
|
|
|
2
|
|
|
|
|
|
Licenses
|
3,917
|
|
|
2,629
|
|
|
|
|
|
Investments in
unconsolidated entities
|
445
|
|
|
435
|
|
|
|
|
|
Property, plant
and equipment, net
|
2,386
|
|
|
2,466
|
|
|
|
|
|
Operating lease
right-of-use assets
|
950
|
|
|
924
|
|
|
|
|
|
Other assets and
deferred charges
|
574
|
|
|
602
|
|
|
|
|
|
Total
assets
|
$
|
9,920
|
|
|
$
|
9,681
|
|
United States
Cellular Corporation
|
Consolidated
Balance Sheet Highlights
|
(Unaudited)
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
June 30,
2021
|
|
December 31,
2020
|
(Dollars in millions,
except per share amounts)
|
|
|
|
Current
liabilities
|
|
|
|
Current portion of
long-term debt
|
$
|
3
|
|
|
$
|
2
|
|
Accounts
payable
|
293
|
|
|
387
|
|
Customer deposits and
deferred revenues
|
153
|
|
|
151
|
|
Accrued
taxes
|
46
|
|
|
48
|
|
Accrued
compensation
|
53
|
|
|
82
|
|
Short-term operating
lease liabilities
|
125
|
|
|
116
|
|
Other current
liabilities
|
78
|
|
|
85
|
|
Total current
liabilities
|
751
|
|
|
871
|
|
|
|
|
|
Liabilities held
for sale
|
—
|
|
|
1
|
|
|
|
|
|
Deferred
liabilities and credits
|
|
|
|
Deferred income tax
liability, net
|
668
|
|
|
633
|
|
Long-term operating
lease liabilities
|
890
|
|
|
875
|
|
Other deferred
liabilities and credits
|
372
|
|
|
376
|
|
|
|
|
|
Long-term debt,
net
|
2,710
|
|
|
2,489
|
|
|
|
|
|
Noncontrolling interests with
redemption features
|
10
|
|
|
10
|
|
|
|
|
|
Equity
|
|
|
|
UScellular
shareholders' equity
|
|
|
|
Series A Common and
Common Shares, par value $1.00 per share
|
88
|
|
|
88
|
|
Additional paid-in
capital
|
1,663
|
|
|
1,651
|
|
Treasury
shares
|
(42)
|
|
|
(67)
|
|
Retained
earnings
|
2,794
|
|
|
2,739
|
|
Total UScellular
shareholders' equity
|
4,503
|
|
|
4,411
|
|
|
|
|
|
Noncontrolling
interests
|
16
|
|
|
15
|
|
|
|
|
|
Total
equity
|
4,519
|
|
|
4,426
|
|
|
|
|
|
Total liabilities
and equity
|
$
|
9,920
|
|
|
$
|
9,681
|
|
View original
content:https://www.prnewswire.com/news-releases/uscellular-reports-second-quarter-2021-results-301349885.html
SOURCE United States Cellular Corporation