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TDS reports fourth quarter and full year 2019 results

02/20/2020
Provides 2020 guidance

CHICAGO, Feb. 20, 2020 /PRNewswire/ --

As previously announced, TDS will hold a teleconference on February 21, 2020 at 9:00 a.m. CST. Listen to the call live via the Events & Presentations page of investors.tdsinc.com.  TDS intends to file its Form 10-K on February 25, 2020. 

Telephone and Data Systems, Inc. (NYSE:TDS) reported total operating revenues of $1,336 million for the fourth quarter of 2019, versus $1,332 million for the same period one year ago. Net income attributable to TDS shareholders and related diluted earnings per share were $12 million and $0.10, respectively, for the fourth quarter of 2019 compared to $16 million and $0.14, respectively, in the same period one year ago.  TDS reported Adjusted EBITDA of $293 million for the fourth quarter of 2019 compared to $288 million in the same period one year ago.

TDS reported total operating revenues of $5,176 million and $5,109 million for the years ended 2019 and 2018, respectively. Net income attributable to TDS shareholders and related diluted earnings per share were $121 million and $1.03, respectively, for the year ended 2019 compared to $135 million and $1.17, respectively, for the year ended 2018.  TDS reported Adjusted EBITDA of $1,319 million in 2019 compared to $1,267 million in 2018.

"I am pleased with the progress the TDS Family of Companies made in 2019 toward our long-term strategic goals," said LeRoy T. Carlson, Jr., TDS President and CEO. "U.S. Cellular executed on a number of important initiatives in 2019 and increased revenues and Adjusted EBITDA, putting it in a strong position to support multi-year investments in network modernization and 5G launches.  TDS Telecom saw continued success with both fiber expansion and broadband penetration, resulting in increased broadband connections and revenues.

"U.S. Cellular customers continued to migrate to unlimited data service plans, shifted to smartphones and adopted device protection plans which combined, boosted average revenue per user. U.S. Cellular also generated strong growth in roaming revenue, while at the same time driving down roaming expense through favorable agreements with major carriers.  U.S. Cellular will continue to invest heavily to improve the customer experience. This year, U.S. Cellular will deploy 5G commercially in two markets and continue its VoLTE deployment. Additionally, it has recently launched commercial service in Sioux City, Iowa and Northern Wisconsin.

"In 2019, TDS Telecom continued to expand their fiber footprint both inside and outside of their traditional markets.  In the wireline segment, increases in 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 and the acquisition of Continuum in North Carolina. TDS Telecom plans more fiber expansion while evaluating additional out-of-territory fiber opportunities and cable acquisitions in attractive markets."

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 February 20, 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.

2020 Estimated Results and Actual Results for the Year Ended December 31, 2019



U.S. Cellular

Estimate


Actual

(Dollars in millions)




Service revenues

$3,000-$3,100


$

3,035


Adjusted OIBDA1

$775-$900


$

832


Adjusted EBITDA1

$950-$1,075


$

1,015


Capital expenditures

$850-$950


$

710






TDS Telecom

Estimate


Actual

(Dollars in millions)




Total operating revenues

$950-$1,000


$

930


Adjusted OIBDA1

$280-$310


$

300


Adjusted EBITDA1

$290-$320


$

313


Capital expenditures

$300-$350


$

316


The following tables provide reconciliations of Net income to Adjusted OIBDA and Adjusted EBITDA for 2020 estimated results 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.


U.S. Cellular


TDS Telecom


Estimate


Actual


Estimate


Actual

(Dollars in millions)








Net income (GAAP)

N/A


$

133



N/A


$

92


Add back:








Income tax expense

N/A


52



N/A


30


Income before income taxes (GAAP)

$130-$255


$

185



$80-$110


$

122


Add back:








Interest expense

110


110




(3)


Depreciation, amortization and accretion expense

690


702



210


200


EBITDA (Non-GAAP)1

$930-$1,055


$

997



$290-$320


$

320


Add back or deduct:








(Gain) loss on asset disposals, net

20


19




(7)


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


(1)





Adjusted EBITDA (Non-GAAP)1

$950-$1,075


$

1,015



$290-$320


$

313


Deduct:








Equity in earnings of unconsolidated entities

160


166





Interest and dividend income

15


17



10


12


Adjusted OIBDA (Non-GAAP)1

$775-$900


$

832



$280-$310


$

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 December 31, 2019, can be found on TDS' website at investors.tdsinc.com.

Conference Call Information

TDS will hold a conference call on February 21, 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 9,400 people as of December 31, 2019.

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

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

For more information about TDS and its subsidiaries, visit:
TDS: www.tdsinc.com
U.S. Cellular: www.uscellular.com
TDS Telecom: www.tdstelecom.com
OneNeck IT Solutions: www.oneneck.com

United States Cellular Corporation

Summary Operating Data (Unaudited)


As of or for the Quarter Ended

12/31/2019


9/30/2019


6/30/2019


3/31/2019


12/31/2018

Retail Connections










Postpaid










Total at end of period

4,383,000



4,395,000



4,414,000



4,440,000



4,472,000


Gross additions

170,000



163,000



137,000



137,000



179,000


Feature phones

2,000



3,000



5,000



4,000



4,000


Smartphones

128,000



121,000



97,000



98,000



132,000


Connected devices

40,000



39,000



35,000



35,000



43,000


Net additions (losses)

(12,000)



(19,000)



(26,000)



(32,000)



6,000


Feature phones

(11,000)



(11,000)



(10,000)



(13,000)



(11,000)


Smartphones

13,000



9,000



(1,000)



(1,000)



31,000


Connected devices

(14,000)



(17,000)



(15,000)



(18,000)



(14,000)


ARPU1

$

46.57



$

46.16



$

45.90



$

45.44



$

45.58


ARPA2

$

120.99



$

119.87



$

119.46



$

118.84



$

119.60


Churn rate3

1.38

%


1.38

%


1.23

%


1.26

%


1.29

%

Handsets

1.11

%


1.09

%


0.97

%


0.99

%


1.00

%

Connected devices

3.44

%


3.44

%


3.01

%


3.08

%


3.20

%

Prepaid










Total at end of period

506,000



510,000



500,000



503,000



516,000


Gross additions

63,000



70,000



61,000



61,000



66,000


Net additions (losses)

(3,000)



9,000



(2,000)



(13,000)



(12,000)


ARPU1

$

34.11



$

34.35



$

34.43



$

33.44



$

32.80


Churn rate3

4.40

%


4.03

%


4.20

%


4.92

%


4.98

%

Total connections at end of period4

4,941,000



4,957,000



4,967,000



4,995,000



5,041,000


Market penetration at end of period










Consolidated operating population

30,740,000



31,310,000



31,310,000



31,310,000



31,469,000


Consolidated operating penetration5

16

%


16

%


16

%


16

%


16

%

Capital expenditures (millions)

$

243



$

170



$

195



$

102



$

242


Total cell sites in service

6,578



6,554



6,535



6,506



6,531


Owned towers

4,166



4,123



4,116



4,106



4,129




Due to rounding, the sum of quarterly results may not equal the total for the year.



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

12/31/2019


9/30/2019


6/30/2019


3/31/2019


12/31/2018

TDS Telecom










Wireline










Residential connections










Voice1

262,100



266,100



269,000



271,100



274,100


Broadband2

241,300



242,200



240,200



236,100



235,400


Video3

58,500



57,300



56,200



54,300



54,000


Wireline residential connections

561,900



565,600



565,500



561,500



563,500












Total residential revenue per connection4

$

49.11



$

49.02



$

47.88



$

48.16



$

47.39












Commercial connections










Voice1

117,800



121,200



124,200



127,300



130,500


Broadband2

20,400



20,600



20,600



20,400



20,600


managedIP5

121,200



124,500



128,300



132,000



134,000


Video3

100



400



400



400



400


Wireline commercial connections

259,600



266,600



273,500



280,100



285,400












Total Wireline connections

821,500



832,300



839,000



841,500



848,900












Cable










Cable residential and commercial connections










Broadband6

193,500



174,900



172,600



171,100



167,400


Video7

106,600



98,000



100,300



101,400



102,900


Voice8

69,500



63,900



64,800



65,400



65,200


managedIP5

1,300



1,200



1,100



1,100



1,000


Total Cable connections

370,900



338,000



338,900



339,000



336,500
























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

12/31/2019


9/30/2019


6/30/2019


3/31/2019


12/31/2018

(Dollars in millions)










Wireline

$

98



$

61



$

55



$

29



$

73


Cable

26



20



15



13



19


Total TDS Telecom

$

124



$

81



$

70



$

42



$

91



Numbers may not foot due to rounding.

 

Telephone and Data Systems, Inc.

Consolidated Statement of Operations Highlights

(Unaudited)



Three Months Ended
December 31,


Year Ended
December 31,


2019


2018


2019

vs. 2018


2019


2018


2019

vs. 2018

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












Operating revenues












U.S. Cellular

$

1,052



$

1,051




$

4,022



$

3,967



1

%

TDS Telecom

235



232



1

%


930



927



All Other1

49



49



1

%


224



215



4

%


1,336



1,332




5,176



5,109



1

%

Operating expenses












U.S. Cellular












Expenses excluding depreciation, amortization and accretion

871



881



(1)

%


3,190



3,177



Depreciation, amortization and accretion

178



162



10

%


702



640



10

%

(Gain) loss on asset disposals, net

6



5



18

%


19



10



80

%

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





N/M



(1)





N/M


(Gain) loss on license sales and exchanges, net





N/M





(18)



98

%


1,055



1,048



1

%


3,910



3,809



3

%

TDS Telecom












Expenses excluding depreciation, amortization and accretion

162



159



2

%


629



624



1

%

Depreciation, amortization and accretion

51



52



(2)

%


200



212



(5)

%

(Gain) loss on asset disposals, net





77

%


(7)



(2)



N/M



213



211



1

%


823



834



(1)

%

All Other1












Expenses excluding depreciation and amortization

53



53




235



229



2

%

Depreciation and amortization

7



8



(8)

%


30



31



(5)

%

(Gain) loss on asset disposals, net





N/M





1



N/M



60



60



(1)

%


264



261



1

%

Total operating expenses

1,328



1,319



1

%


4,997



4,904



2

%

Operating income (loss)












U.S. Cellular

(3)



3



N/M



112



158



(29)

%

TDS Telecom

21



22



(3)

%


107



93



15

%

All Other1

(11)



(12)



10

%


(40)



(46)



12

%


8



13



(41)

%


179



205



(13)

%

Investment and other income (expense)












Equity in earnings of unconsolidated entities

39



39



(2)

%


168



160



5

%

Interest and dividend income

5



8



(39)

%


29



26



15

%

Interest expense

(37)



(43)



15

%


(165)



(172)



4

%

Other, net

(1)



1



(71)

%




2



N/M


Total investment and other income (expense)

6



5



38

%


32



16



92

%

Income before income taxes

14



18



(19)

%


211



221



(5)

%

Income tax expense (benefit)

(1)



(2)



75

%


64



46



37

%

Net income

15



20



(25)

%


147



175



(16)

%

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

3



4



(17)

%


26



40



(36)

%

Net income attributable to TDS shareholders

$

12



$

16



(27)

%


$

121



$

135



(10)

%













Basic weighted average shares outstanding

115



113



1

%


114



112



2

%

Basic earnings per share attributable to TDS shareholders

$

0.10



$

0.14



(28)

%


$

1.06



$

1.20



(11)

%













Diluted weighted average shares outstanding

116



115




116



114



2

%

Diluted earnings per share attributable to TDS shareholders

$

0.10



$

0.14



(28)

%


$

1.03



$

1.17



(12)

%



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)


Year Ended December 31,

2019


2018

(Dollars in millions)




Cash flows from operating activities




Net income

$

147



$

175


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




Depreciation, amortization and accretion

932



883


Bad debts expense

112



101


Stock-based compensation expense

59



54


Deferred income taxes, net

34



33


Equity in earnings of unconsolidated entities

(168)



(160)


Distributions from unconsolidated entities

162



153


(Gain) loss on asset disposals, net

12



9


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

(1)




(Gain) loss on license sales and exchanges, net



(18)


Other operating activities

4



4


Changes in assets and liabilities from operations




Accounts receivable

(49)



(39)


Equipment installment plans receivable

(97)



(149)


Inventory

(19)



(5)


Accounts payable

(60)



2


Customer deposits and deferred revenues

(9)



8


Accrued taxes

(17)



(29)


Other assets and liabilities

(26)



(5)


Net cash provided by operating activities

1,016



1,017






Cash flows from investing activities




Cash paid for additions to property, plant and equipment

(957)



(776)


Cash paid for acquisitions and licenses

(346)



(16)


Cash received from investments

29



100


Cash paid for investments

(11)



(17)


Cash received from divestitures and exchanges

41



29


Other investing activities

(5)




Net cash used in investing activities

(1,249)



(680)






Cash flows from financing activities




Repayment of long-term debt

(118)



(20)


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

(6)



42


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

(9)



18


Repurchase of U.S. Cellular Common Shares

(21)




Dividends paid to TDS shareholders

(75)



(72)


Distributions to noncontrolling interests

(4)



(6)


Other financing activities

13



6


Net cash used in financing activities

(220)



(32)






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

(453)



305






Cash, cash equivalents and restricted cash




Beginning of period

927



622


End of period

$

474



$

927


 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)


ASSETS


December 31,

2019¹


2018

(Dollars in millions)




Current assets




Cash and cash equivalents

$

465



$

921


Short-term investments



17


Accounts receivable

1,124



1,099


Inventory, net

169



150


Prepaid expenses

98



103


Income taxes receivable

36



12


Other current assets

29



28


Total current assets

1,921



2,330






Assets held for sale



54






Licenses

2,480



2,195






Goodwill

547



509






Other intangible assets, net

239



253






Investments in unconsolidated entities

488



480






Property, plant and equipment, net

3,527



3,346






Operating lease right-of-use assets

972








Other assets and deferred charges

607



616






Total assets

$

10,781



$

9,783


 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)


LIABILITIES AND EQUITY


December 31,

2019¹


2018

(Dollars in millions, except per share amounts)




Current liabilities




Current portion of long-term debt

$

10



$

21


Accounts payable

374



365


Customer deposits and deferred revenues

189



197


Accrued interest

11



11


Accrued taxes

41



44


Accrued compensation

121



127


Short-term operating lease liabilities

116




Other current liabilities

100



114


Total current liabilities

962



879






Liabilities held for sale



1






Deferred liabilities and credits




Deferred income tax liability, net

676



640


Long-term operating lease liabilities

931




Other deferred liabilities and credits

481



541






Long-term debt, net

2,316



2,418






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

2,468



2,432


Treasury shares, at cost

(479)



(519)


Accumulated other comprehensive loss

(9)



(10)


Retained earnings

2,672



2,656


Total TDS shareholders' equity

4,653



4,560






Noncontrolling interests

751



733






Total equity

5,404



5,293






Total liabilities and equity

$

10,781



$

9,783




1

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

 

Balance Sheet Highlights

(Unaudited)



December 31, 2019


U.S.

Cellular


TDS

Telecom


TDS
Corporate

& Other


Intercompany

Eliminations


TDS

Consolidated

(Dollars in millions)










Cash and cash equivalents

$

285



$

21



$

159



$



$

465


Affiliated cash investments



505





(505)





$

285



$

526



$

159



$

(505)



$

465












Licenses, goodwill and other intangible assets

$

2,471



$

783



$

12



$



$

3,266


Investment in unconsolidated entities

447



4



47



(10)



488



$

2,918



$

787



$

59



$

(10)



$

3,754












Property, plant and equipment, net

$

2,207



$

1,211



$

109



$



$

3,527












Long-term debt, net:










Current portion

$

8



$

1



$

1



$



$

10


Non-current portion

1,502



4



810





2,316



$

1,510



$

5



$

811



$



$

2,326


 

TDS Telecom Highlights

(Unaudited)



Three Months Ended
December 31,


Year Ended
December 31,


2019


2018


2019 vs.
2018


2019


2018


2019 vs.
2018

(Dollars in millions)












Wireline












Operating revenues












Residential

$

83



$

80



3

%


$

328



$

321



2

%

Commercial

40



45



(10)

%


168



184



(9)

%

Wholesale

47



48




186



191



(2)

%

Total service revenues

171



173



(1)

%


682



697



(2)

%

Equipment and product sales





(30)

%


1



2



(26)

%


171



173



(1)

%


683



699



(2)

%

Operating expenses












Cost of services

68



67



2

%


263



266



(1)

%

Cost of equipment and products





(17)

%


1



1



(24)

%

Selling, general and administrative expenses

50



51



(2)

%


199



197



1

%

Expenses excluding depreciation, amortization and accretion

119



118




463



465



Depreciation, amortization and accretion

33



35



(4)

%


132



142



(7)

%

(Gain) loss on asset disposals, net





N/M



(8)



(3)



N/M



153



153




587



604



(3)

%

Operating income

$

18



$

20



(7)

%


$

96



$

95



1

%













Cable












Operating revenues












Residential

$

53



$

48



9

%


$

205



$

188



9

%

Commercial

11



12



(5)

%


43



42



3

%


64



60



7

%


247



230



8

%

Operating expenses












Cost of services

26



26



3

%


105



104



2

%

Selling, general and administrative expenses

17



15



15

%


62



57



8

%

Expenses excluding depreciation, amortization and accretion

44



41



8

%


167



161



4

%

Depreciation, amortization and accretion

17



17



1

%


68



69



(2)

%

(Gain) loss on asset disposals, net





(46)

%


1



1



(48)

%


61



58



5

%


236



231



2

%

Operating income (loss)

$

3



$

2



42

%


$

11



$

(2)



N/M














Total TDS Telecom operating income

$

21



$

22



(3)

%


$

107



$

93



15

%


N/M - Percentage change not meaningful.


Numbers may not foot due to rounding.

 

Telephone and Data Systems, Inc.

Financial Measures and Reconciliations


Free Cash Flow



Three Months Ended
December 31,


Year Ended
December 31,


2019


2018


2019


2018

(Dollars in millions)








Cash flows from operating activities (GAAP)

$

142



$

205



$

1,016



$

1,017


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

326



330



957



776


Free cash flow (Non-GAAP)1

$

(184)



$

(125)



$

59



$

241




1

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

EBITDA, Adjusted EBITDA and Adjusted OIBDA

The following table reconciles EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measures, Net income and Income before income taxes.


Three Months Ended
December 31,


Year Ended
December 31,

TDS1

2019


2018


2019


2018

(Dollars in millions)








Net income (GAAP)

$

15



$

20



$

147



$

175


Add back or deduct:








Income tax benefit

(1)



(2)



64



46


Income before income taxes (GAAP)

14



18



211



221


Add back:








Interest expense

37



43



165



172


Depreciation, amortization and accretion expense

236



222



932



883


EBITDA (Non-GAAP)

287



283



1,308



1,276


Add back or deduct:








(Gain) loss on asset disposals, net

6



5



12



9


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





(1)




(Gain) loss on license sales and exchanges, net







(18)


Adjusted EBITDA (Non-GAAP)

293



288



1,319



1,267


Deduct:








Equity in earnings of unconsolidated entities

39



39



168



160


Interest and dividend income

5



8



29



26


Other, net

(1)



1





2


Adjusted OIBDA (Non-GAAP)

$

250



$

240



$

1,122



$

1,079




1

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

 

Cision View original content:http://www.prnewswire.com/news-releases/tds-reports-fourth-quarter-and-full-year-2019-results-301008723.html

SOURCE Telephone and Data Systems, Inc.

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