CHICAGO, Aug. 3, 2018 /PRNewswire/ --
As previously announced, U.S. Cellular will hold a teleconference August 3, 2018, at
9:30 a.m. CDT. Listen to the live call via the Events & Presentations page of investors.uscellular.com.
United States Cellular Corporation (NYSE:USM) reported total operating revenues of $974 million
for the second quarter of 2018, versus $963 million for the same period one year ago. Net income
attributable to U.S. Cellular shareholders and related diluted earnings per share were $49 million
and $0.56, respectively, for the second quarter of 2018, compared to $12
million and $0.14, respectively, in the same period one year ago.
"I'm very pleased with the progress we made this quarter and in the first half of the year," said Kenneth R. Meyers, U.S. Cellular president and CEO. "We generated improved financial results by delivering on
our customer satisfaction strategy. Our efforts produced both revenue growth and improvements in our cost structure.
Combined these factors drove a 25% increase in Adjusted EBITDA in the quarter. Also these results provided the confidence
to raise our 2018 guidance.
"It's been a year since we launched our Total Plans, and they continue to be effective in attracting new customers and meeting
the needs of our current customers. Both postpaid handset net additions and gross additions increased sequentially, and postpaid
handset churn remained exceptionally low. Another driver of customer satisfaction is our high-quality network, which continues to
perform well even as data usage increases significantly. Additionally, our network team completed commercial rollouts of VoLTE in
our California, Oregon and Washington markets."
2018 Estimated Results
U.S. Cellular's current estimates of full-year 2018 results are shown below. Such estimates represent
management's view as of August 3, 2018. Such forward‑looking statements should not be assumed
to be current as of any future date. U.S. Cellular undertakes no duty to update such information, whether as a result of
new information, future events or otherwise. There can be no assurance that final results will not differ materially from
such estimated results.
|
|
2018 Estimated Results
|
|
|
Current (1)
|
|
Previous
|
(Dollars in millions)
|
|
|
|
Total operating revenues
|
$3,925-$4,025
|
|
$3,850-$4,050
|
Adjusted OIBDA (2)(3)
|
$700-$800
|
|
$625-$775
|
Adjusted EBITDA (2)
|
$850-$950
|
|
$765-$915
|
Capital expenditures
|
$500-$550
|
|
Unchanged
|
The following table provides a reconciliation of Net income to Adjusted OIBDA and Adjusted EBITDA for 2018 estimated results,
actual results for the six months ended June 30, 2018, and actual results for the year ended
December 31, 2017. In providing 2018 estimated results, U.S. Cellular has not completed the
below reconciliation to Net income because it does not provide guidance for income taxes. Although potentially significant,
U.S. Cellular believes that the impact of income taxes cannot be reasonably predicted; therefore, U.S. Cellular is unable to
provide such guidance.
|
|
|
|
|
|
|
|
Actual Results
|
|
|
|
|
|
2018 Estimated
Results (1)
|
|
|
Six Months Ended
June 30, 2018 (1)
|
|
|
Year Ended
December 31,
2017
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
Net income (GAAP)
|
|
|
N/A
|
|
$
|
107
|
|
$
|
15
|
Add back or deduct:
|
|
|
|
|
|
|
|
|
|
|
Income tax expense (benefit)
|
|
|
N/A
|
|
|
40
|
|
|
(287)
|
Income (loss) before income taxes (GAAP)
|
|
$
|
110-210
|
|
$
|
147
|
|
$
|
(272)
|
Add back:
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
110
|
|
|
58
|
|
|
113
|
|
Depreciation, amortization and accretion expense
|
|
|
640
|
|
|
317
|
|
|
615
|
EBITDA (Non-GAAP) (2)
|
|
$
|
860-960
|
|
$
|
522
|
|
$
|
456
|
Add back or deduct:
|
|
|
|
|
|
|
|
|
|
|
Loss on impairment of goodwill
|
|
|
–
|
|
|
–
|
|
|
370
|
|
(Gain) loss on asset disposals, net
|
|
|
10
|
|
|
2
|
|
|
17
|
|
(Gain) loss on sale of business and other exit costs, net
|
|
|
–
|
|
|
–
|
|
|
(1)
|
|
(Gain) loss on license sales and exchanges, net
|
|
|
(20)
|
|
|
(17)
|
|
|
(22)
|
Adjusted EBITDA (Non-GAAP) (2)
|
|
$
|
850-950
|
|
$
|
507
|
|
$
|
820
|
Deduct:
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of unconsolidated entities
|
|
|
135
|
|
|
78
|
|
|
137
|
|
Interest and dividend income
|
|
|
15
|
|
|
7
|
|
|
8
|
|
Other, net
|
|
|
–
|
|
|
(1)
|
|
|
–
|
Adjusted OIBDA (Non-GAAP) (2)(3)
|
|
$
|
700-800
|
|
$
|
423
|
|
$
|
675
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Totals may not foot due to rounding differences.
|
|
(1)
|
As of January 1, 2018, U.S. Cellular adopted the new revenue recognition
standard, ASC 606, using a modified retrospective approach. Under this method, the new accounting standard is
applied only to the most recent period presented. As a result, 2018 amounts include the impacts of ASC 606, but
2017 amounts remain as previously reported.
|
|
|
(2)
|
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. U.S. Cellular 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 U.S. Cellular'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 U.S. Cellular'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 (loss) before income
taxes.
|
|
(3)
|
Additional information and reconciliations related to Non-GAAP financial
measures for June 30, 2018, can be found on U.S. Cellular's website at investors.uscellular.com.
|
Conference Call Information
U.S. Cellular will hold a conference call on August 3, 2018 at 9:30 a.m. Central Time.
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 U.S. Cellular
United States Cellular Corporation provides a comprehensive range of wireless products and services, excellent customer support,
and a high-quality network to customers with 5.1 million connections in 22 states. The Chicago-based company had 5,700 full- and part-time associates as of June 30,
2018. At the end of the second quarter of 2018, Telephone and Data Systems, Inc. owned 83 percent of U.S. Cellular. For
more information about U.S. Cellular, 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 execute U.S. Cellular's business strategy; uncertainties in U.S. Cellular's
future cash flows and liquidity and access to the capital markets; the ability to make payments on 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 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. Investors are encouraged to
consider these and other risks and uncertainties that are discussed in the Form 8-K Current Report used by U.S. Cellular to
furnish this press release to the Securities and Exchange Commission, which are incorporated by reference
herein.
For more information about U.S. Cellular, visit:
U.S. Cellular: www.uscellular.com
United States Cellular Corporation
|
Summary Operating Data (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of or for the Quarter Ended
|
6/30/2018(1)
|
|
3/31/2018(1)
|
|
12/31/2017
|
|
|
9/30/2017
|
|
6/30/2017
|
Retail Connections
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Postpaid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total at end of period
|
|
4,468,000
|
|
|
4,481,000
|
|
|
4,518,000
|
|
|
4,513,000
|
|
|
4,478,000
|
|
|
Gross additions
|
|
146,000
|
|
|
129,000
|
|
|
177,000
|
|
|
191,000
|
|
|
174,000
|
|
|
|
Feature phones
|
|
5,000
|
|
|
5,000
|
|
|
5,000
|
|
|
7,000
|
|
|
7,000
|
|
|
|
Smartphones
|
|
106,000
|
|
|
91,000
|
|
|
128,000
|
|
|
132,000
|
|
|
116,000
|
|
|
|
Connected devices
|
|
35,000
|
|
|
33,000
|
|
|
44,000
|
|
|
52,000
|
|
|
51,000
|
|
|
Net additions (losses)
|
|
(13,000)
|
|
|
(37,000)
|
|
|
5,000
|
|
|
35,000
|
|
|
23,000
|
|
|
|
Feature phones
|
|
(12,000)
|
|
|
(15,000)
|
|
|
(15,000)
|
|
|
(15,000)
|
|
|
(15,000)
|
|
|
|
Smartphones
|
|
17,000
|
|
|
(1,000)
|
|
|
33,000
|
|
|
44,000
|
|
|
34,000
|
|
|
|
Connected devices
|
|
(18,000)
|
|
|
(21,000)
|
|
|
(13,000)
|
|
|
6,000
|
|
|
4,000
|
|
|
ARPU (2)
|
$
|
44.74
|
|
$
|
44.34
|
|
$
|
44.12
|
|
$
|
43.41
|
|
$
|
44.60
|
|
|
ABPU (Non-GAAP)(3)
|
$
|
57.75
|
|
$
|
57.10
|
|
$
|
56.69
|
|
$
|
54.71
|
|
$
|
55.19
|
|
|
ARPA (4)
|
$
|
118.57
|
|
$
|
118.22
|
|
$
|
118.05
|
|
$
|
116.36
|
|
$
|
119.73
|
|
|
ABPA (Non-GAAP)(5)
|
$
|
153.03
|
|
$
|
152.26
|
|
$
|
151.68
|
|
$
|
146.65
|
|
$
|
148.15
|
|
|
Churn rate (6)
|
|
1.19%
|
|
|
1.23%
|
|
|
1.27%
|
|
|
1.16%
|
|
|
1.13%
|
|
|
|
Handsets
|
|
0.92%
|
|
|
0.97%
|
|
|
1.00%
|
|
|
0.96%
|
|
|
0.91%
|
|
|
|
Connected devices
|
|
2.85%
|
|
|
2.79%
|
|
|
2.84%
|
|
|
2.33%
|
|
|
2.35%
|
|
Prepaid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total at end of period
|
|
527,000
|
|
|
525,000
|
|
|
519,000
|
|
|
515,000
|
|
|
484,000
|
|
|
Gross additions
|
|
78,000
|
|
|
88,000
|
|
|
83,000
|
|
|
102,000
|
|
|
73,000
|
|
|
Net additions
|
|
2,000
|
|
|
6,000
|
|
|
4,000
|
|
|
31,000
|
|
|
3,000
|
|
|
ARPU (2)
|
$
|
32.32
|
|
$
|
31.78
|
|
$
|
32.42
|
|
$
|
33.12
|
|
$
|
33.52
|
|
|
Churn rate (6)
|
|
4.83%
|
|
|
5.27%
|
|
|
5.09%
|
|
|
4.75%
|
|
|
4.93%
|
Total connections at end of period (7)
|
|
5,051,000
|
|
|
5,063,000
|
|
|
5,096,000
|
|
|
5,089,000
|
|
|
5,023,000
|
Market penetration at end of period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated operating population
|
|
31,469,000
|
|
|
31,469,000
|
|
|
31,834,000
|
|
|
31,834,000
|
|
|
32,089,000
|
|
Consolidated operating penetration (8)
|
|
16%
|
|
|
16%
|
|
|
16%
|
|
|
16%
|
|
|
16%
|
Capital expenditures (millions)
|
$
|
86
|
|
$
|
70
|
|
$
|
213
|
|
$
|
112
|
|
$
|
84
|
Total cell sites in service
|
|
6,478
|
|
|
6,473
|
|
|
6,460
|
|
|
6,436
|
|
|
6,421
|
Owned towers
|
|
4,105
|
|
|
4,099
|
|
|
4,080
|
|
|
4,051
|
|
|
4,044
|
|
(1)
|
As of January 1, 2018, U.S. Cellular adopted the new revenue recognition
standard, ASC 606, using a modified retrospective approach. Under this method, the new accounting standard is
applied only to the most recent period presented. As a result, 2018 amounts include the impacts of ASC 606, but
2017 amounts remain as previously reported.
|
|
|
(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 Billings Per User (ABPU) - non-GAAP metric is calculated by
dividing total postpaid service revenues plus equipment installment plan billings by the average number of postpaid
connections and by the number of months in the period. Refer to the end of this release for a reconciliation of
this metric to its most comparable GAAP metric.
|
|
|
(4)
|
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.
|
|
|
(5)
|
Average Billings Per Account (ABPA) - non-GAAP metric is calculated by
dividing total postpaid service revenues plus equipment installment plan billings by the average number of postpaid
accounts and by the number of months in the period. Refer to the end of this release for a reconciliation of this
metric to its most comparable GAAP metric.
|
|
|
(6)
|
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.
|
|
|
(7)
|
Includes reseller and other connections.
|
|
|
(8)
|
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.
|
United States Cellular Corporation
|
Consolidated Statement of Operations Highlights
|
(Unaudited)
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30,
|
|
June 30,
|
|
|
2018 (1)
|
|
|
2017
|
|
2018 vs.
2017
|
|
|
2018 (1)
|
|
|
2017
|
|
2018 vs.
2017
|
(Dollars and shares in millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
$
|
741
|
|
$
|
740
|
|
-
|
|
$
|
1,465
|
|
$
|
1,486
|
|
(1)%
|
|
Equipment sales
|
|
233
|
|
|
223
|
|
5%
|
|
|
450
|
|
|
413
|
|
9%
|
|
|
Total operating revenues
|
|
974
|
|
|
963
|
|
1%
|
|
|
1,915
|
|
|
1,899
|
|
1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
System operations (excluding Depreciation, amortization and accretion reported below)
|
|
187
|
|
|
189
|
|
(1)%
|
|
|
365
|
|
|
364
|
|
-
|
|
Cost of equipment sold
|
|
240
|
|
|
260
|
|
(8)%
|
|
|
459
|
|
|
488
|
|
(6)%
|
|
Selling, general and administrative
|
|
342
|
|
|
351
|
|
(2)%
|
|
|
668
|
|
|
691
|
|
(3)%
|
|
Depreciation, amortization and accretion
|
|
159
|
|
|
155
|
|
3%
|
|
|
317
|
|
|
307
|
|
3%
|
|
(Gain) loss on asset disposals, net
|
|
1
|
|
|
5
|
|
(84)%
|
|
|
2
|
|
|
9
|
|
(75)%
|
|
(Gain) loss on license sales and exchanges, net
|
|
(11)
|
|
|
(2)
|
|
>(100)%
|
|
|
(17)
|
|
|
(19)
|
|
8%
|
|
|
Total operating expenses
|
|
918
|
|
|
958
|
|
(4)%
|
|
|
1,794
|
|
|
1,840
|
|
(2)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
56
|
|
|
5
|
|
>100%
|
|
|
121
|
|
|
59
|
|
>100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment and other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of unconsolidated entities
|
|
40
|
|
|
33
|
|
20%
|
|
|
78
|
|
|
66
|
|
18%
|
|
Interest and dividend income
|
|
3
|
|
|
2
|
|
63%
|
|
|
7
|
|
|
5
|
|
45%
|
|
Interest expense
|
|
(29)
|
|
|
(28)
|
|
(2)%
|
|
|
(58)
|
|
|
(56)
|
|
(3)%
|
|
Other, net
|
|
–
|
|
|
–
|
|
>100%
|
|
|
(1)
|
|
|
(1)
|
|
14%
|
|
|
Total investment and other income
|
|
14
|
|
|
7
|
|
>100%
|
|
|
26
|
|
|
14
|
|
85%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
70
|
|
|
12
|
|
>100%
|
|
|
147
|
|
|
73
|
|
>100%
|
|
Income tax expense
|
|
18
|
|
|
–
|
|
>100%
|
|
|
40
|
|
|
33
|
|
21%
|
Net income
|
|
52
|
|
|
12
|
|
>100%
|
|
|
107
|
|
|
40
|
|
>100%
|
|
Less: Net income attributable to noncontrolling interests, net of tax
|
|
3
|
|
|
–
|
|
>100%
|
|
|
14
|
|
|
2
|
|
>100%
|
Net income attributable to U.S. Cellular shareholders
|
$
|
49
|
|
$
|
12
|
|
>100%
|
|
$
|
93
|
|
$
|
38
|
|
>100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares outstanding
|
|
86
|
|
|
85
|
|
1%
|
|
|
85
|
|
|
85
|
|
-
|
Basic earnings per share attributable to U.S. Cellular shareholders
|
$
|
0.57
|
|
$
|
0.14
|
|
>100%
|
|
$
|
1.09
|
|
$
|
0.45
|
|
>100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average shares outstanding
|
|
86
|
|
|
86
|
|
1%
|
|
|
86
|
|
|
86
|
|
1%
|
Diluted earnings per share attributable to U.S. Cellular shareholders
|
$
|
0.56
|
|
$
|
0.14
|
|
>100%
|
|
$
|
1.08
|
|
$
|
0.44
|
|
>100%
|
|
(1)
|
As of January 1, 2018, U.S. Cellular adopted the new revenue recognition
standard, ASC 606, using a modified retrospective approach. Under this method, the new accounting standard is applied
only to the most recent period presented. As a result, 2018 amounts include the impacts of ASC 606, but 2017 amounts
remain as previously reported.
|
United States Cellular Corporation
|
Consolidated Statement of Cash Flows
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
2018 (1)
|
|
2017
|
(Dollars in millions)
|
|
|
|
|
|
Cash flows from operating activities
|
|
|
|
|
|
|
Net income
|
$
|
107
|
|
$
|
40
|
|
Add (deduct) adjustments to reconcile net income to net cash flows from
operating activities
|
|
|
|
|
|
|
|
|
Depreciation, amortization and accretion
|
|
317
|
|
|
307
|
|
|
|
Bad debts expense
|
|
40
|
|
|
47
|
|
|
|
Stock-based compensation expense
|
|
17
|
|
|
14
|
|
|
|
Deferred income taxes, net
|
|
9
|
|
|
(27)
|
|
|
|
Equity in earnings of unconsolidated entities
|
|
(78)
|
|
|
(66)
|
|
|
|
Distributions from unconsolidated entities
|
|
70
|
|
|
65
|
|
|
|
(Gain) loss on asset disposals, net
|
|
2
|
|
|
9
|
|
|
|
(Gain) loss on license sales and exchanges, net
|
|
(17)
|
|
|
(19)
|
|
|
|
Noncash interest
|
|
2
|
|
|
1
|
|
Changes in assets and liabilities from operations
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
43
|
|
|
(5)
|
|
|
|
Equipment installment plans receivable
|
|
(47)
|
|
|
(107)
|
|
|
|
Inventory
|
|
(3)
|
|
|
(2)
|
|
|
|
Accounts payable
|
|
(35)
|
|
|
(53)
|
|
|
|
Customer deposits and deferred revenues
|
|
(23)
|
|
|
(6)
|
|
|
|
Accrued taxes
|
|
6
|
|
|
45
|
|
|
|
Other assets and liabilities
|
|
(45)
|
|
|
(23)
|
|
|
|
|
Net cash provided by operating activities
|
|
365
|
|
|
220
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
Cash paid for additions to property, plant and equipment
|
|
(173)
|
|
|
(155)
|
|
Cash paid for licenses
|
|
(2)
|
|
|
(189)
|
|
Cash received for investments
|
|
50
|
|
|
–
|
|
Cash received from divestitures and exchanges
|
|
21
|
|
|
17
|
|
Other investing activities
|
|
3
|
|
|
–
|
|
|
|
|
Net cash used in investing activities
|
|
(101)
|
|
|
(327)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
Repayment of long-term debt
|
|
(10)
|
|
|
(6)
|
|
Payment of debt issuance costs
|
|
(1)
|
|
|
–
|
|
Distributions to noncontrolling interests
|
|
(4)
|
|
|
(2)
|
|
Other financing activities
|
|
(4)
|
|
|
1
|
|
|
|
|
Net cash used in financing activities
|
|
(19)
|
|
|
(7)
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash, cash equivalents and restricted
cash
|
|
245
|
|
|
(114)
|
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents and restricted cash
|
|
|
|
|
|
|
Beginning of period
|
|
352
|
|
|
586
|
|
End of period
|
$
|
597
|
|
$
|
472
|
|
(1)
|
As of January 1, 2018, U.S. Cellular adopted the new revenue recognition
standard, ASC 606, using a modified retrospective approach. Under this method, the new accounting standard is applied
only to the most recent period presented. As a result, 2018 amounts include the impacts of ASC 606, but 2017 amounts
remain as previously reported.
|
United States Cellular Corporation
|
Consolidated Balance Sheet Highlights
|
(Unaudited)
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
|
2018 (1)
|
|
2017
|
(Dollars in millions)
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
Cash and cash equivalents
|
$
|
596
|
|
$
|
352
|
|
Short-term investments
|
|
–
|
|
|
50
|
|
Accounts receivable
|
|
875
|
|
|
843
|
|
Inventory, net
|
|
141
|
|
|
138
|
|
Prepaid expenses
|
|
63
|
|
|
79
|
|
Other current assets
|
|
34
|
|
|
21
|
|
|
Total current assets
|
|
1,709
|
|
|
1,483
|
|
|
|
|
|
|
|
|
Assets held for sale
|
|
1
|
|
|
10
|
|
|
|
|
|
|
|
|
Licenses
|
|
2,231
|
|
|
2,223
|
|
|
|
|
|
|
|
|
Investments in unconsolidated entities
|
|
439
|
|
|
415
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
2,159
|
|
|
2,320
|
|
|
|
|
|
|
|
|
Other assets and deferred charges
|
|
536
|
|
|
390
|
|
|
|
|
|
|
|
|
Total assets
|
$
|
7,075
|
|
$
|
6,841
|
United States Cellular Corporation
|
Consolidated Balance Sheet Highlights
|
(Unaudited)
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
|
2018 (1)
|
|
2017
|
(Dollars in millions, except per share amounts)
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
Current portion of long-term debt
|
$
|
18
|
|
$
|
18
|
|
Accounts payable
|
|
257
|
|
|
310
|
|
Customer deposits and deferred revenues
|
|
127
|
|
|
185
|
|
Accrued taxes
|
|
58
|
|
|
56
|
|
Accrued compensation
|
|
48
|
|
|
74
|
|
Other current liabilities
|
|
82
|
|
|
90
|
|
|
Total current liabilities
|
|
590
|
|
|
733
|
|
|
|
|
|
|
|
|
Deferred liabilities and credits
|
|
|
|
|
|
|
Deferred income tax liability, net
|
|
522
|
|
|
461
|
|
Other deferred liabilities and credits
|
|
367
|
|
|
337
|
|
|
|
|
|
|
|
|
Long-term debt, net
|
|
1,614
|
|
|
1,622
|
|
|
|
|
|
|
|
|
Noncontrolling interests with redemption features
|
|
11
|
|
|
1
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
U.S. Cellular shareholders' equity
|
|
|
|
|
|
|
Series A Common and Common Shares, par value $1 per share
|
|
88
|
|
|
88
|
|
Additional paid-in capital
|
|
1,569
|
|
|
1,552
|
|
Treasury shares
|
|
(99)
|
|
|
(120)
|
|
Retained earnings
|
|
2,402
|
|
|
2,157
|
|
|
Total U.S. Cellular shareholders' equity
|
|
3,960
|
|
|
3,677
|
|
|
|
|
|
|
|
|
Noncontrolling interests
|
|
11
|
|
|
10
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
3,971
|
|
|
3,687
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
$
|
7,075
|
|
$
|
6,841
|
|
(1)
|
As of January 1, 2018, U.S. Cellular adopted the new revenue recognition
standard, ASC 606, using a modified retrospective approach. Under this method, the new accounting standard is
applied only to the most recent period presented. As a result, 2018 amounts include the impacts of ASC 606, but
2017 amounts remain as previously reported.
|
United States Cellular Corporation
|
Financial Measures and Reconciliations
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow
|
|
Three Months Ended
|
|
Six Months Ended
|
|
June 30,
|
|
June 30,
|
|
|
2018
|
|
2017
|
|
|
2018
|
|
2017
|
(Dollars in millions)
|
|
|
|
|
Cash flows from operating activities (GAAP)
|
$
|
178
|
$
|
159
|
|
$
|
365
|
$
|
220
|
Less: Cash paid for additions to property, plant and equipment
|
|
98
|
|
67
|
|
|
173
|
|
155
|
|
Free cash flow (Non-GAAP) (1)
|
$
|
80
|
$
|
92
|
|
$
|
192
|
$
|
65
|
|
(1)
|
Management uses Free cash flow as a liquidity measure and it is defined as
Cash flows from operating activities less Cash paid for additions to property, plant and equipment. Free cash flow
is a non-GAAP financial measure which U.S. Cellular 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.
|
Postpaid ABPU and Postpaid ABPA
U.S. Cellular presents Postpaid ABPU and Postpaid ABPA to reflect the revenue shift from Service revenues to Equipment sales
resulting from the increased adoption of equipment installment plans. Postpaid ABPU and Postpaid ABPA, as previously
defined herein, are non-GAAP financial measures which U.S. Cellular believes are useful to investors and other users of its
financial information in showing trends in both service and equipment sales revenues received from customers.
For the Quarter Ended
|
|
6/30/2018(1)
|
|
|
3/31/2018(1)
|
|
|
12/31/2017
|
|
|
9/30/2017
|
|
|
6/30/2017
|
(Dollars and connection counts in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of Postpaid ARPU
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Postpaid service revenues
|
$
|
600
|
|
$
|
598
|
|
$
|
598
|
|
$
|
586
|
|
$
|
597
|
Average number of postpaid connections
|
|
4.47
|
|
|
4.50
|
|
|
4.52
|
|
|
4.50
|
|
|
4.47
|
Number of months in period
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
Postpaid ARPU (GAAP metric)
|
$
|
44.74
|
|
$
|
44.34
|
|
$
|
44.12
|
|
$
|
43.41
|
|
$
|
44.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of Postpaid ABPU
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Postpaid service revenues
|
$
|
600
|
|
$
|
598
|
|
$
|
598
|
|
$
|
586
|
|
$
|
597
|
Equipment installment plan billings
|
|
174
|
|
|
172
|
|
|
170
|
|
|
152
|
|
|
142
|
|
Total billings to postpaid connections
|
$
|
774
|
|
$
|
770
|
|
$
|
768
|
|
$
|
738
|
|
$
|
739
|
Average number of postpaid connections
|
|
4.47
|
|
|
4.50
|
|
|
4.52
|
|
|
4.50
|
|
|
4.47
|
Number of months in period
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
Postpaid ABPU (Non-GAAP metric)
|
$
|
57.75
|
|
$
|
57.10
|
|
$
|
56.69
|
|
$
|
54.71
|
|
$
|
55.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of Postpaid ARPA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Postpaid service revenues
|
$
|
600
|
|
$
|
598
|
|
$
|
598
|
|
$
|
586
|
|
$
|
597
|
Average number of postpaid accounts
|
|
1.69
|
|
|
1.69
|
|
|
1.69
|
|
|
1.68
|
|
|
1.66
|
Number of months in period
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
Postpaid ARPA (GAAP metric)
|
$
|
118.57
|
|
$
|
118.22
|
|
$
|
118.05
|
|
$
|
116.36
|
|
$
|
119.73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of Postpaid ABPA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Postpaid service revenues
|
$
|
600
|
|
$
|
598
|
|
$
|
598
|
|
$
|
586
|
|
$
|
597
|
Equipment installment plan billings
|
|
174
|
|
|
172
|
|
|
170
|
|
|
152
|
|
|
142
|
|
Total billings to postpaid accounts
|
$
|
774
|
|
$
|
770
|
|
$
|
768
|
|
$
|
738
|
|
$
|
739
|
Average number of postpaid accounts
|
|
1.69
|
|
|
1.69
|
|
|
1.69
|
|
|
1.68
|
|
|
1.66
|
Number of months in period
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
Postpaid ABPA (Non-GAAP metric)
|
$
|
153.03
|
|
$
|
152.26
|
|
$
|
151.68
|
|
$
|
146.65
|
|
$
|
148.15
|
|
(1)
|
As of January 1, 2018, U.S. Cellular adopted the new revenue recognition
standard, ASC 606, using a modified retrospective approach. Under this method, the new accounting standard is applied
only to the most recent period presented. As a result, 2018 amounts include the impacts of ASC 606, but 2017 amounts
remain as previously reported.
|
View original content:http://www.prnewswire.com/news-releases/us-cellular-reports-second-quarter-2018-results-300691718.html
SOURCE United States Cellular Corporation