TDS reports second quarter 2020 results

CHICAGO, Aug. 6, 2020 /PRNewswire/ --

As previously announced, TDS will hold a teleconference August 7, 2020, 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. (NYSE:TDS) reported total operating revenues of $1,263 million for the second quarter of 2020, versus $1,261 million for the same period one year ago. Net income attributable to TDS shareholders and related diluted earnings per share were $65 million and $0.56, respectively, for the second quarter of 2020 compared to $33 million and $0.28, respectively, in the same period one year ago.

"The TDS Enterprise and its family of companies remains strong through the ongoing challenges of the COVID-19 pandemic," said LeRoy T. Carlson, Jr., TDS President and CEO. "U.S. Cellular and TDS Telecom continue to provide essential communication and high-quality data services to our customers and communities. Our associates have shown exceptional dedication and resiliency in keeping our operations and networks performing at top levels. TDS also is maintaining a strong and flexible financial foundation.

"At U.S. Cellular, LT Therivel has moved seamlessly into his new role as CEO. He is focused on observing, learning and understanding all facets of the organization, meeting with U.S. Cellular associates and identifying new opportunities and ways to accelerate growth. I am confident LT's leadership, experience and collaborative style will build upon the many successes that U.S. Cellular has already achieved. U.S. Cellular's top priority remains to continuously adapt to fully meet the wireless needs of the communities and customers we serve. Despite COVID-19, most U.S. Cellular stores are now open and they continue to follow strong safety measures to keep our customers and associates safe. Exceptionally low levels of churn have offset lower store traffic and enabled U.S. Cellular to increase smartphone connections in the quarter. Our network modernization program continues, adding capacity and speed, launching 5G services commercially, and preparing for remaining VoLTE deployments. In these unprecedented times, our high-quality network has remained strong. I am pleased U.S. Cellular ranked #1 in the North Central Region in the J.D. Power 2020 Wireless Network Quality Performance Study.

"TDS Telecom continues to successfully meet significant demand for higher data speeds and increased network capacity across its footprint. Growth in Wireline video and broadband connections, coupled with demand for higher broadband speeds, drove increases in average residential revenue per connection. Cable connections also grew rapidly driven by strong increases in broadband connections. TDS Telecom continues to move forward with fiber deployment in out-of-territory expansion markets.  A total of 25,000 service addresses in the out-of-territory markets were added in the first half of the year increasing total fiber service addresses to 265,000.  In rolling out new markets, the safety of our customers, field service technicians and sales representatives remains a top priority.  We have implemented our safety procedures that minimize the amount of work technicians do within the home through encouraging self-service and remote customer assistance techniques."

2020 Estimated Results

TDS' current estimates of full-year 2020 results for U.S. Cellular and TDS Telecom are shown below. Such estimates represent management's view as of August 6, 2020 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, especially in light of the uncertainty created by the COVID-19 pandemic.

2020 Estimated Results



U.S. Cellular

Previous

Current

(Dollars in millions)



Service revenues

$3,000-$3,100

Unchanged

Adjusted OIBDA1

$725-$850

Unchanged

Adjusted EBITDA1

$900-$1,025

Unchanged

Capital expenditures

$850-$950

Unchanged




TDS Telecom

Previous

Current

(Dollars in millions)



Total operating revenues

$950-$1,000

Unchanged

Adjusted OIBDA1

$280-$310

Unchanged

Adjusted EBITDA1

$290-$320

Unchanged

Capital expenditures

$300-$350

Unchanged

The following tables provide reconciliations of Net income to Adjusted OIBDA and Adjusted EBITDA for 2020 estimated results, actual results for the six months ended June 30, 2020, and actual results for the year ended December 31, 2019. In providing 2020 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.



2020 Estimated Results


U.S. Cellular


TDS Telecom

(Dollars in millions)




Net income (GAAP)

N/A


N/A

Add back:




Income tax expense

N/A


N/A

Income before income taxes (GAAP)

$95-$220


$80-$110

Add back:




Interest expense

100


Depreciation, amortization and accretion expense

685


210

EBITDA (Non-GAAP)1

$880-$1,005


$290-$320

Add back or deduct:




(Gain) loss on asset disposals, net

20


Adjusted EBITDA (Non-GAAP)1

$900-$1,025


$290-$320

Deduct:




Equity in earnings of unconsolidated entities

165


Interest and dividend income

10


10

Adjusted OIBDA (Non-GAAP)1

$725-$850


$280-$310

 


Actual Results


Six Months Ended
June 30, 2020


Year Ended
December 31, 2019


U.S.

Cellular


TDS

Telecom


U.S.

Cellular


TDS

Telecom

(Dollars in millions)








Net income (GAAP)

$

141



$

56



$

133



$

92


Add back:








Income tax expense

8



8



52



30


Income before income taxes (GAAP)

$

149



$

64



$

185



$

122


Add back:








Interest expense

49



(2)



110



(3)


Depreciation, amortization and accretion expense

354



103



702



200


EBITDA (Non-GAAP)1

$

552



$

165



$

997



$

320


Add back or deduct:








(Gain) loss on asset disposals, net

8





19



(7)


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





(1)




Adjusted EBITDA (Non-GAAP)1

$

560



$

165



$

1,015



$

313


Deduct:








Equity in earnings of unconsolidated entities

89





166




Interest and dividend income

5



4



17



12


Other, net



(1)






Adjusted OIBDA (Non-GAAP)1

$

466



$

162



$

832



$

300



Numbers may not foot due to rounding.


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. 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, 2020, can be found on TDS' website at investors.tdsinc.com.

Conference Call Information
TDS will hold a conference call on August 7, 2020 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 9,300 people as of June 30, 2020.

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: the impact, duration and severity of the COVID-19 pandemic; 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; 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 state and federal regulatory environment; the ability to attract people of outstanding talent throughout all levels of the organization; conditions in the U.S. telecommunications industry; TDS' smaller scale relative to larger competitors; changes in demand, consumer preferences, price competition, or  churn rates; advances in  technology; the value of assets and investments; impacts of costs, integration problems or other factors associated with acquisitions, divestitures or exchanges of properties or licenses and/or expansion of TDS' businesses; the ability of the company to successfully construct and manage its networks; difficulties involving third parties; cyber-attacks or other breaches of network or information technology security; changes in facts and circumstances that could require TDS to record adjustments to amounts reflected in the financial statements; disruption in credit or other financial markets; deterioration of U.S. or global economic conditions; pending and future litigation. 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 TDS' Form 10-K, as updated by any TDS Form 10-Q filed subsequent to such Form 10-K.

The impact of the COVID-19 pandemic on TDS' business is uncertain, but depending on its duration and severity it could have a material adverse effect on TDS' business, financial condition or results of operations.

The impact of the recent global spread of COVID-19 on TDS' future operations is uncertain. Public health emergencies, such as COVID-19, pose the risk that TDS or its associates, agents, partners and suppliers may be unable to conduct business activities for an extended period of time and/or provide the level of service expected. TDS' ability to attract customers, maintain an adequate supply chain and execute on its business strategies and initiatives could be negatively impacted by this outbreak. Additionally, COVID-19 has caused and could continue to cause increased unemployment, economic downturn and credit market deterioration, all of which could negatively impact TDS. The extent of the impact of COVID-19 on TDS' business, financial condition and results of operations will depend on future circumstances, including the severity of the disease, the duration of the outbreak, actions taken by governmental authorities and other possible direct and indirect consequences, all of which are uncertain and cannot be predicted.

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

6/30/2020


3/31/2020


12/31/2019


9/30/2019


6/30/2019

Retail Connections










Postpaid










Total at end of period

4,372,000



4,359,000



4,383,000



4,395,000



4,414,000


Gross additions

129,000



132,000



170,000



163,000



137,000


Feature phones

3,000



2,000



2,000



3,000



5,000


Smartphones

82,000



88,000



128,000



121,000



97,000


Connected devices

44,000



42,000



40,000



39,000



35,000


Net additions (losses)

12,000



(26,000)



(12,000)



(19,000)



(26,000)


Feature phones

(8,000)



(10,000)



(11,000)



(11,000)



(10,000)


Smartphones

11,000



(10,000)



13,000



9,000



(1,000)


Connected devices

9,000



(6,000)



(14,000)



(17,000)



(15,000)


ARPU1

$

46.24



$

47.23



$

46.57



$

46.16



$

45.90


ARPA2

$

120.70



$

122.92



$

120.99



$

119.87



$

119.46


Churn rate3

0.89

%


1.21

%


1.38

%


1.38

%


1.23

%

Handsets

0.71

%


0.95

%


1.11

%


1.09

%


0.97

%

Connected devices

2.24

%


3.11

%


3.44

%


3.44

%


3.01

%

Prepaid










Total at end of period

496,000



494,000



506,000



510,000



500,000


Gross additions

62,000



57,000



63,000



70,000



61,000


Net additions (losses)

2,000



(12,000)



(3,000)



9,000



(2,000)


ARPU1

$

34.89



$

34.07



$

34.11



$

34.35



$

34.43


Churn rate3

4.05

%


4.67

%


4.40

%


4.03

%


4.20

%

Total connections at end of period4

4,919,000



4,903,000



4,941,000



4,957,000



4,967,000


Market penetration at end of period










Consolidated operating population

31,292,000



31,292,000



30,740,000



31,310,000



31,310,000


Consolidated operating penetration5

16

%


16

%


16

%


16

%


16

%

Capital expenditures (millions)

$

168



$

236



$

243



$

170



$

195


Total cell sites in service

6,673



6,629



6,578



6,554



6,535


Owned towers

4,208



4,184



4,166



4,123



4,116




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

6/30/2020


3/31/2020


12/31/2019


9/30/2019


6/30/2019

TDS Telecom










Wireline










Residential connections










Voice1

261,800



259,100



262,100



266,100



269,000


Broadband2

255,100



242,700



241,300



242,200



240,200


Video3

61,400



59,000



58,500



57,300



56,200


Wireline residential connections

578,300



560,700



561,900



565,600



565,500












Total residential revenue per connection4

$

49.73



$

50.12



$

49.11



$

49.02



$

47.88












Commercial connections










Voice1

112,400



114,400



117,800



121,200



124,200


Broadband2

20,700



20,500



20,400



20,600



20,600


managedIP5

115,500



118,300



121,200



124,500



128,300


Video3

200



100



100



400



400


Wireline commercial connections

248,700



253,400



259,600



266,600



273,500












Total Wireline connections

827,000



814,200



821,500



832,300



839,000












Cable










Cable residential and commercial connections










Broadband6

203,700



196,800



193,500



174,900



172,600


Video7

103,400



105,100



106,600



98,000



100,300


Voice8

69,000



68,900



69,500



63,900



64,800


managedIP5

1,800



1,400



1,300



1,200



1,100


Total Cable connections

378,000



372,300



370,900



338,000



338,900























Numbers may not foot due to rounding.


1

The individual circuits connecting a customer to Wireline's central office facilities that provide voice services.

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

6/30/2020


3/31/2020


12/31/2019


9/30/2019


6/30/2019

(Dollars in millions)










Wireline

$

58



$

39



$

98



$

61



$

55


Cable

17



15



26



20



15


Total TDS Telecom

$

75



$

54



$

124



$

81



$

70


 

Telephone and Data Systems, Inc.

Consolidated Statement of Operations Highlights

(Unaudited)






Three Months Ended
June 30,


Six Months Ended
June 30,


2020


2019


2020

vs. 2019


2020


2019


2020

vs. 2019

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












Operating revenues












U.S. Cellular

$

973



$

973




$

1,937



$

1,939



TDS Telecom

241



233



3

%


481



464



4

%

All Other1

49



55



(10)

%


106



115



(7)

%


1,263



1,261




2,524



2,518



Operating expenses












U.S. Cellular












Expenses excluding depreciation, amortization and accretion

738



761



(3)

%


1,471



1,496



(2)

%

Depreciation, amortization and accretion

178



177



1

%


354



345



3

%

(Gain) loss on asset disposals, net

4



5



(19)

%


8



7



7

%

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





N/M





(2)



N/M


(Gain) loss on license sales and exchanges, net





N/M





(2)



N/M



920



943



(2)

%


1,833



1,844



(1)

%

TDS Telecom












Expenses excluding depreciation, amortization and accretion

158



155



2

%


319



305



4

%

Depreciation, amortization and accretion

51



50



3

%


103



100



3

%

(Gain) loss on asset disposals, net



(1)



N/M





(8)



N/M



210



204



3

%


422



398



6

%

All Other1












Expenses excluding depreciation and amortization

49



58



(16)

%


105



119



(10)

%

Depreciation and amortization

7



7



(22)

%


13



15



(23)

%

(Gain) loss on asset disposals, net



1



N/M





1



N/M



55



66



(17)

%


118



134



(11)

%

Total operating expenses

1,185



1,213



(2)

%


2,373



2,376



Operating income (loss)












U.S. Cellular

53



30



74

%


104



95



9

%

TDS Telecom

31



29



6

%


59



66



(10)

%

All Other1

(6)



(11)



51

%


(12)



(19)



35

%


78



48



63

%


151



142



6

%

Investment and other income (expense)












Equity in earnings of unconsolidated entities

44



41



8

%


90



85



5

%

Interest and dividend income

2



9



(76)

%


8



17



(53)

%

Interest expense

(38)



(43)



10

%


(75)



(86)



12

%

Other, net





59

%


(1)



1



(57)

%

Total investment and other income

8



7



22

%


22



17



34

%

Income before income taxes

86



55



58

%


173



159



9

%

Income tax expense

8



16



(47)

%


12



50



(76)

%

Net income

78



39



N/M



161



109



47

%

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

13



6



100

%


26



17



53

%

Net income attributable to TDS shareholders

$

65



$

33



N/M



$

135



$

92



46

%













Basic weighted average shares outstanding

114



114




115



114



Basic earnings per share attributable to TDS shareholders

$

0.57



$

0.29



N/M



$

1.18



$

0.81



46

%













Diluted weighted average shares outstanding

115



116



(1)

%


115



116



Diluted earnings per share attributable to TDS shareholders

$

0.56



$

0.28



N/M



$

1.15



$

0.78



47

%


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,


2020


2019

(Dollars in millions)




Cash flows from operating activities




Net income

$

161



$

109


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




Depreciation, amortization and accretion

470



460


Bad debts expense

48



50


Stock-based compensation expense

25



33


Deferred income taxes, net

150



40


Equity in earnings of unconsolidated entities

(90)



(85)


Distributions from unconsolidated entities

91



76


(Gain) loss on asset disposals, net

8




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



(2)


(Gain) loss on license sales and exchanges, net



(2)


Other operating activities

1



3


Changes in assets and liabilities from operations




Accounts receivable

21



(2)


Equipment installment plans receivable

22



(11)


Inventory

15



(4)


Accounts payable

49



(9)


Customer deposits and deferred revenues

(8)



8


Accrued taxes

(115)



2


Accrued interest



2


Other assets and liabilities

(42)



(76)


Net cash provided by operating activities

806



592






Cash flows from investing activities




Cash paid for additions to property, plant and equipment

(610)



(393)


Cash paid for licenses

(144)



(255)


Cash received from investments

1



11


Cash paid for investments

(1)



(11)


Cash received from divestitures and exchanges

1



32


Advance payments for license acquisitions

(16)




Net cash used in investing activities

(769)



(616)






Cash flows from financing activities




Issuance of long-term debt

175




Repayment of long-term debt

(5)



(11)


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

(3)



(6)


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

(8)



(8)


Repurchase of TDS Common Shares

(14)




Repurchase of U.S. Cellular Common Shares

(23)




Dividends paid to TDS shareholders

(39)



(38)


Payment of debt issuance costs

(7)




Distributions to noncontrolling interests

(1)



(2)


Other financing activities



3


Net cash provided by (used in) financing activities

75



(62)






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

112



(86)






Cash, cash equivalents and restricted cash




Beginning of period

474



927


End of period

$

586



$

841


 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)


ASSETS






June 30, 2020


December 31, 2019

(Dollars in millions)




Current assets




Cash and cash equivalents

$

565



$

465


Accounts receivable, net

1,064



1,124


Inventory, net

152



169


Prepaid expenses

106



98


Income taxes receivable

160



36


Other current assets

39



29


Total current assets

2,086



1,921






Licenses

2,630



2,480






Goodwill

547



547






Other intangible assets, net

226



239






Investments in unconsolidated entities

486



488






Property, plant and equipment, net

3,615



3,527






Operating lease right-of-use assets

985



972






Other assets and deferred charges

586



607






Total assets

$

11,161



$

10,781


 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)


LIABILITIES AND EQUITY






June 30, 2020


December 31, 2019

(Dollars in millions, except per share amounts)




Current liabilities




Current portion of long-term debt

$

5



$

10


Accounts payable

349



374


Customer deposits and deferred revenues

181



189


Accrued interest

11



11


Accrued taxes

41



41


Accrued compensation

85



121


Short-term operating lease liabilities

124



116


Other current liabilities

86



100


Total current liabilities

882



962






Deferred liabilities and credits




Deferred income tax liability, net

825



676


Long-term operating lease liabilities

938



931


Other deferred liabilities and credits

515



481






Long-term debt, net

2,487



2,316






Noncontrolling interests with redemption features

11



11






Equity




TDS shareholders' equity




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

1



1


Capital in excess of par value

2,472



2,468


Treasury shares, at cost

(479)



(479)


Accumulated other comprehensive loss

(7)



(9)


Retained earnings

2,751



2,672


Total TDS shareholders' equity

4,738



4,653






Noncontrolling interests

765



751






Total equity

5,503



5,404






Total liabilities and equity

$

11,161



$

10,781


 

Balance Sheet Highlights

(Unaudited)




June 30, 2020


U.S.


TDS


TDS Corporate


Intercompany


TDS


Cellular


Telecom


& Other


Eliminations


Consolidated

(Dollars in millions)










Cash and cash equivalents

$

418



$



$

147



$



$

565


Affiliated cash investments



550





(550)





$

418



$

550



$

147



$

(550)



$

565












Licenses, goodwill and other intangible assets

$

2,621



$

772



$

10



$



$

3,403


Investment in unconsolidated entities

445



4



47



(10)



486



$

3,066



$

776



$

57



$

(10)



$

3,889












Property, plant and equipment, net

$

2,258



$

1,253



$

104



$



$

3,615












Long-term debt, net:










Current portion

$

4



$

1



$

1



$



$

5


Non-current portion

1,625



4



858





2,487



$

1,629



$

4



$

859



$



$

2,492



Numbers may not foot due to rounding.

 

TDS Telecom Highlights

(Unaudited)














Three Months Ended
June 30,


Six Months Ended
June 30,


2020


2019


2020 vs.
2019


2020


2019


2020 vs.
2019

(Dollars in millions)












Wireline












Operating revenues












Residential

$

85



$

81



6

%


$

170



$

162



5

%

Commercial

38



42



(10)

%


77



86



(10)

%

Wholesale

46



49



(6)

%


91



94



(3)

%

Total service revenues

169



172



(2)

%


338



342



(1)

%

Equipment and product sales





(48)

%




1



(45)

%


169



172



(2)

%


339



343



(1)

%

Operating expenses












Cost of services

63



64



(3)

%


128



127



1

%

Cost of equipment and products





(10)

%




1



(33)

%

Selling, general and administrative expenses

48



49



(2)

%


97



96



1

%

Expenses excluding depreciation, amortization and accretion

111



114



(2)

%


225



224



1

%

Depreciation, amortization and accretion

32



33



(3)

%


64



66



(4)

%

(Gain) loss on asset disposals, net



(1)



N/M





(8)



N/M



143



145



(2)

%


289



282



3

%

Operating income

$

27



$

27



(1)

%


$

50



$

61



(18)

%













Cable












Operating revenues












Residential

$

60



$

51



19

%


$

119



$

100



19

%

Commercial

11



11



3

%


23



21



7

%


71



62



16

%


142



121



17

%

Operating expenses












Cost of services

30



27



12

%


60



52



14

%

Selling, general and administrative expenses

17



15



14

%


34



30



15

%

Expenses excluding depreciation, amortization and accretion

47



42



13

%


94



82



15

%

Depreciation, amortization and accretion

20



17



15

%


39



34



15

%

(Gain) loss on asset disposals, net





6

%




1



(62)

%


67



59



13

%


133



117



14

%

Operating income (loss)

$

4



$

2



78

%


$

9



$

5



90

%













Total TDS Telecom operating income

$

31



$

29



6

%


$

59



$

66



(10)

%

























N/M - Percentage change not meaningful.


Numbers may not foot due to rounding.

 

Telephone and Data Systems, Inc.
Financial Measures and Reconciliations
(Unaudited)





Free Cash Flow






Three Months Ended
June 30,


Six Months Ended
June 30,


2020


2019


2020


2019

(Dollars in millions)








Cash flows from operating activities (GAAP)

$

440



$

265



$

806



$

592


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

233



239



610



393


Free cash flow (Non-GAAP)1

$

207



$

26



$

196



$

199




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.

 

Cision View original content:http://www.prnewswire.com/news-releases/tds-reports-second-quarter-2020-results-301107997.html

SOURCE Telephone and Data Systems, Inc.

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