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ATN Reports Fourth Quarter and Full Year 2017 Results

Fourth Quarter Financial Highlights:

  • Revenues: $107.7 million
  • Adjusted EBITDA1: $30.8 million
  • Operating income of $41.5 million includes $32.6 million in net hurricane insurance recoveries
  • Net income attributable to ATN stockholders: $43.5 million, or $2.71  per diluted share
  • Cash flow from operating activities for full year 2017 was $145.7 million

BEVERLY, Mass., Feb. 21, 2018 (GLOBE NEWSWIRE) -- ATN (NASDAQ:ATNI) today reported results for the fourth quarter and year ended December 31, 2017. Unless otherwise indicated, the discussion of the Company’s results is in comparison to the same period in the prior year.

Business Review and Outlook

“Fourth quarter revenue performance was consistent with our expectations across all of our business units and represents a base to build upon in 2018,” said Michael Prior, Chief Executive Officer. "Those expectations included lower International Telecom segment revenue due to the tremendous damage caused by the two Category 5 hurricanes that hit the Virgin Islands in September.  The Viya team, with support from ATN and contractors, has been working around the clock to get our hurricane-damaged U.S. Virgin Islands operations back to normal, following progress on power restoration. As previously noted, while we are making major progress in the first quarter, full restoration of the wireline networks will take until mid-2018 based on recent estimates. On a consolidated basis, our profits for the quarter rebounded from the third quarter, as well as year-on-year, as we recognized the full benefit on our storm-related insurance claims and were able to reduce our group tax liabilities due to the recent U.S. tax law changes.  Those changes will benefit us moving forward and help level the competitive playing field in a number of international markets as well as freeing us up to more efficiently allocate capital to the most promising investments and operations.

“Full year 2017 results included both the positive and negative impacts of several special items, which have skewed year-on-year comparisons, but we have entered 2018 with much of our business positioned for sequential improvement into 2019.  We expect to see progressively better performance from our International Telecom operations as we re-connect customers in the U.S. Virgin Islands and continue to grow our broadband subscriber base following fiber network expansions in other markets.

“As previously noted, we expect our U.S. Telecom segment’s 2018 revenues to be below 2017 levels, in the range of $110 million to $120 million. Almost two-thirds of the projected decrease is related to significant asset sales, notably our Northeast wireline operation, which closed in March of 2017, and the previously-announced sale of 100 wholesale wireless sites to a carrier customer that is expected to close in early 2018. The balance is attributable to lower contractual roaming rates in our domestic wholesale business, the impact of which we expect to partially offset through lower ongoing capital expenditures and reduced operating expenses.  Looking further ahead, we see our existing domestic telecommunications properties as a relatively consistent source of cash flows to fund investments and other opportunities for growth. 

“In renewable energy many of our recently completed sites have received regulatory approval and are now generating revenue.  As we head into 2018, we expect our first phase of completed solar power plants in India to generate revenue of approximately $6 to $7 million per annum.  We are in discussions with funding partners and evaluating the pace and extent of our expansion opportunities in India beyond this initial phase.  

“We generated strong operating cash flow in 2017, and increased free cash flow continues to be a focus as we carefully analyze capital spending in our telecom businesses. Outside of hurricane restoration costs, we expect 2018 capital spending to be significantly lower than in the last few years, reflecting the pending completion of several major network upgrades in our international telecom segment and the alignment of domestic wholesale capital investment with current market conditions.  Tax reform will lower our effective tax rate from our historical average and will provide additional resources for investment in organic and strategic growth,” Mr. Prior noted.

Fourth Quarter and Full Year 2017 Financial Results

Fourth quarter 2017 revenues were $107.7 million, a 16% decrease from the $128.5 million reported for the fourth quarter of 2016.  Revenue decreases for the quarter included approximately $17 million in reductions due to service disruptions as a result of the September 2017 hurricanes in the U.S. Virgin Islands in addition to the absence of revenue from our recently exited U.S. wireline business.  These reductions were partially offset by revenue increases in our U.S. wireless business, growth in international broadband and wireless revenues and the ramping up of revenue generation from our solar business in India.  Adjusted EBITDA1 for the fourth quarter was $30.8 million, 7% below the prior year period, primarily associated with the foregoing revenue decreases.  Operating income for the fourth quarter was $41.5 million due in large part to the $32.6 million from the recognition of insurance benefits from the hurricanes partially offset by hurricane charges.  Operating income excluding hurricane charges and insurance recoveries2 for the fourth quarter was $8.9 million.

Net income attributable to ATN’s stockholders for the fourth quarter was $43.5 million or $2.71 per diluted share, an increase over the prior year net income of $1.9 million or $0.12 per diluted share.  The Income Tax benefit for the quarter reflects the recent passage of the Tax Cuts and Jobs Act of 2017 and includes a $7.4 million transition tax on foreign earnings offset by an $18.4 million benefit from reduced federal rates on our deferred tax liabilities.  Net Income attributable to ATN stockholders excluding hurricane charges and insurance recoveries2 for the fourth quarter was $11.0 million, or $0.69 per diluted share.
                                                                                                                      
Revenues for the full year 2017 were $481.2 million, a 5% increase from the $457.0 million reported for the full year 2016.  Revenue increases for this period are mostly due to the full year 2017 impact of the 2016 acquisitions in Bermuda and the U.S. Virgin Islands, partially offset by decreases in the U.S. wireless business and the 2017 sale of the U.S. wireline business.  Adjusted EBITDA1 for the full year 2017 was $148.6 million, an increase of 1% from the prior year.  Operating income for the full year 2017 was $55.5 million compared with $49.8 million of operating income in the prior year.  Net income for the full year attributable to ATN stockholders was $31.5 million or $1.94 per diluted share, as compared to the prior year $12.1 million and $0.75 per diluted share.

Fourth Quarter 2017 Operating Highlights

The Company has three reportable segments: (i) U.S. Telecom; (ii) International Telecom; and (iii) Renewable Energy. 

U.S. Telecom

U.S. Telecom revenues consist mainly of wireless revenues from our voice and data wholesale roaming operations and our smaller retail operations in the Southwestern United States, as well as enterprise and wholesale wireline revenues.  Total U.S. Telecom segment revenues were $34.8 million in the fourth quarter of 2017, an 11% decrease from the $39.0 million reported in the fourth quarter of 2016.  U.S. wireless revenues increased 4% to $32.1 million compared with $30.9 million in the prior year quarter due mostly to increased wholesale traffic.   U.S. wireline revenues decreased to $2.2 million from $7.7 million in the prior year quarter primarily as a result of the sale of our Northeastern U.S. wireline business in early March 2017. The Company ended the fourth quarter of 2017 with 1,100 domestic base stations in service compared to 1,006 at the end of 2016. 

U.S. Telecom Adjusted EBITDA1 of $16.8 million in the fourth quarter of 2017 increased 2% compared to the prior year’s $16.4 million.  The increase was mainly due to the growth in wireless revenues and reductions in wireless operating expenses.   

International Telecom

International Telecom consists of a broad range of information and communications services including wireline and wireless data, internet, voice and video service revenues from our operations in Bermuda and the Caribbean including the U.S. Virgin Islands. International Telecom revenues were $66.9 million in the fourth quarter of 2017, a 21% decrease from the $84.7 million reported in the fourth quarter of 2016.  While some of the reduction in revenues is due to the sale of businesses in St. Maarten and the British Virgin Islands earlier in 2017 and despite some offsetting increases in certain markets, the bulk of the decline was due to the extensive network storm-driven service outages in the U.S. Virgin Islands.  The first quarter of 2018 will also see significantly lower revenue for this segment given the continued impacts of the hurricanes.  We expect revenue in the second quarter to recover throughout the period, though the level of damage to the Virgin Islands economy may mean it is some time before we see a return to pre-storm levels in that market.  We are carefully evaluating the scope and other aspects of our investments in network restoration in light of the situation.

International Telecom Adjusted EBITDA1 of $16.8 million in the fourth quarter decreased 17% from $20.1 million in the prior year period.  The decrease is primarily the result of the revenue impact from service outages resulting from the hurricanes in the U.S. Virgin Islands.    

Renewable Energy

Renewable Energy segment revenues are generated principally by the generation and sale of energy and solar renewable energy credits from our commercial solar projects in the United States and India.  For the fourth quarter of 2017, revenues from our renewable energy business were $5.9 million, and increased 23% from the $4.8 million in the prior year due mainly to commencement of revenue generation from newly completed solar power plants in India.  The growth in India power production revenue drove an increase in Adjusted EBITDA1 for the Renewable Energy segment to $3.6 million in the fourth quarter, up $0.9 million from the prior year’s quarter.   

Balance Sheet and Cash Flow Highlights

Cash and short-term investments at December 31, 2017 were $215.0 million.  Net cash provided by operating activities was $145.7 million for the full year of 2017, compared with $111.7 million for the full year of 2016.  The increase in net cash provided by operating activities is largely due to lower acquisition related charges and a $22.5 million funding of a pension obligation in lieu of purchase consideration paid to the seller of 2016 U.S. Virgin Islands acquisition, offset partially by changes in working capital.  During 2017, the Company used cash of $20.5 million for investments in new assets and businesses and received $22.4 million from the sales and dispositions of other business lines.  Capital expenditures for the year totaled $142.4 million.  Included in the total was $103.1 million of capital expenditures in the domestic and international telecom segments, including $13.3 million incurred for hurricane restorations, and $30.9 million for the construction of solar facilities in India. The Company expects full year 2018 capital expenditures for its domestic and international telecom businesses to be $65 million to $80 million excluding hurricane restoration costs in the U.S. Virgin Islands.  Hurricane restoration capital expenditures are expected to be between $35 million and $45 million in 2018.  We estimate capital expenditures of approximately $5 million to $7 million will be spent to finish the initial phase of India renewables construction, however continued expansion in the market is largely dependent on our ability to secure local financing and the timing and terms and conditions which are difficult to estimate at this time.    

In the year ended December 31, 2017, the Company repurchased 201,932 shares of common stock totaling $10.6 million under its share repurchase program and paid $19.2 million in dividends.   

Conference Call Information

ATN will host a conference call on Thursday, February 22, 2018 at 9:30 a.m. Eastern Time (ET) to discuss its fourth quarter 2017 results. The call will be hosted by Michael Prior, President and Chief Executive Officer, and Justin Benincasa, Chief Financial Officer. The dial-in numbers are US/Canada: (877) 734-4582 and International: (678) 905-9376, conference ID 1685639. A replay of the call will be available at ir.atni.com beginning at 1:00 p.m. (ET) on February 22, 2018.

About ATN

ATN International, Inc. (Nasdaq:ATNI), headquartered in Beverly, Massachusetts, provides telecommunications services to rural, niche and other under-served markets and geographies in the United States, Bermuda and the Caribbean and owns and operates solar power systems in various locations in the United States and India. Through our operating subsidiaries, we (i) provide both wireless and wireline connectivity to residential and business customers, including a range of mobile wireless solutions, high speed internet services, video services and local exchange services, (ii) provide distributed solar electric power to corporate and municipal customers and (iii) are the owner and operator of terrestrial and submarine fiber optic transport systems. For more information, please visit www.atni.com.

Cautionary Language Concerning Forward Looking Statements

This press release contains forward-looking statements relating to, among other matters, our future financial performance and results of operations; the estimated timeline for restoration of our U.S. Virgin Islands operations; our estimates of total losses due to Hurricanes Irma and Maria; the competitive environment in our key markets, demand for our services and industry trends; the pace of expansion and improvement of our telecommunications network and renewable energy operations including our level of estimated future capital expenditures and our realization of the benefits of these investments; the anticipated timing of our build schedule and the commencement of energy production of our India renewable energy projects; anticipated effects of recent U.S. tax changes; and management’s plans and strategy for the future. These forward-looking statements are based on estimates, projections, beliefs, and assumptions and are not guarantees of future events or results.  Actual future events and results could differ materially from the events and results indicated in these statements as a result of many factors, including, among others, (1)   our ability to restore our networks and services to our customers in the U.S. Virgin Islands in an efficient and timely manner; (2) our ability to execute planned network expansions and upgrades in our various markets; (3) the general performance of our operations, including operating margins, revenues, capital expenditures, and the future growth and retention of our major customers and subscriber base and consumer demand for solar power; (4) government regulation of our businesses, which may impact our FCC and other telecommunications licenses or our renewables business; (5) economic, political and other risks facing our operations; (6) our ability to maintain favorable roaming arrangements and satisfy the needs and demands of our major wireless customers; (7) our ability to efficiently and cost-effectively upgrade our networks and IT platforms to address  rapid and significant technological changes in the telecommunications industry; (8) the loss of or an inability to recruit skilled personnel in our various jurisdictions, including key members of management; (9) our ability to find investment or acquisition or disposition opportunities that fit the strategic goals of the Company; (10) increased competition; (11) our ability to expand our renewable energy business; (12) our reliance on a limited number of key suppliers and vendors for timely supply of equipment and services relating to our network infrastructure; (13) the adequacy and expansion capabilities of our network capacity and customer service system to support our customer growth; (14) the occurrence of weather events and natural catastrophes; (15) our continued access to capital and credit markets; (16) the risk of currency fluctuation for those markets in which we operate and (17) our ability to realize the value that we believe exists in our businesses.  These and other additional factors that may cause actual future events and results to differ materially from the events and results indicated in the forward-looking statements above are set forth more fully under Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, filed with the SEC on March 1, 2017 and the other reports we file from time to time with the SEC.  The Company undertakes no obligation and has no intention to update these forward-looking statements to reflect actual results, changes in assumptions or changes in other factors that may affect such forward-looking statements.

Use of Non-GAAP Financial Measures

In addition to financial measures prepared in accordance with generally accepted accounting principles (GAAP), this press release also contains non-GAAP financial measures. Specifically, ATN has presented the following measures:  Adjusted EBITDA; Operating Income excluding hurricane charges and insurance recoveries; Net income (loss) attributable to ATN’s stockholders excluding hurricane charges and insurance recoveries and; Net income (loss) per share attributable to ATN stockholders excluding hurricane charges and insurance recoveries.  Adjusted EBITDA is defined as net income attributable to ATN stockholders before bargain purchase gain, impairment of long-lived assets, restructuring charges, interest, taxes, depreciation and amortization, transaction-related charges, other income or expense, loss on damaged assets and other hurricane charges, net of insurance recovery and net income attributable to non-controlling interests.  Operating Income excluding hurricane charges and insurance recoveries is defined as Operating Income (Loss) adjusted for loss on damaged assets and other hurricane related charges, net of insurance recovery.  Net income (loss) attributable to ATN stockholders excluding hurricane charges and insurance recoveries is defined as Net Income (Loss) attributable to ATN stockholders adjusted for loss on damaged assets and other hurricane related charges net of insurance recovery.  Net income (loss) per share attributable to ATN stockholders excluding hurricane charges and insurance recoveries is defined as net income (loss) per share attributable to ATN stockholders adjusted for loss on damaged assets and other hurricane related charges, net of insurance recovery.  The Company believes that the inclusion of these non-GAAP financial measures helps investors gain a meaningful understanding of the Company's core operating results and enhances comparing such performance with prior periods. ATN’s management uses these non-GAAP measures, in addition to GAAP financial measures, as the basis for measuring our core operating performance and comparing such performance to that of prior periods. The non-GAAP financial measures included in this press release are not meant to be considered superior to or a substitute for results of operations prepared in accordance with GAAP. Reconciliations of these non-GAAP financial measures used in this press release to the most directly comparable GAAP financial measure is set forth in the text of, and the accompanying tables to, this press release.                 

1 See Table 5 for reconciliation of Net Income to Adjusted EBITDA.
2 See Table 6 for reconciliation of Operating Income (Loss), Net Income (Loss) Attributable to ATN Stockholders and Net Income (Loss) Attributable to ATN Stockholders per share to Operating Income excluding hurricane charges and insurance recoveries, Net Income Attributable to ATN Stockholders excluding hurricane charges and insurance recoveries and Diluted Income per share Attributable to ATN Stockholders excluding hurricane charges and insurance recoveries, respectively.

Contact:          
978-619-1300
Michael T. Prior
Chief Executive Officer

Justin D. Benincasa
Chief Financial Officer

 

   
  Table 1
  ATN International, Inc.
  Unaudited Condensed Consolidated Balance Sheets
  (in Thousands)
         
    December 31,   December 31,
  2017 2016
  Assets:      
    Cash and cash equivalents $   207,956   $   269,721
    Restricted cash     833       524
    Short-term investments     7,076       9,237
    Other current assets     127,062       87,887
         
    Total current assets     342,927       367,369
         
    Long-term restricted cash     11,101       18,113
    Property, plant and equipment, net     643,146       647,712
    Goodwill and other intangible assets, net     171,657       126,193
    Other assets     35,580       38,831
         
  Total assets $   1,204,411   $   1,198,218
         
  Liabilities and Stockholders’ Equity:      
    Current portion of long-term debt $   10,919   $   12,440
    Taxes payable     7,126       13,531
    Other current liabilities     144,035       124,134
         
    Total current liabilities     162,080       150,105
         
    Long-term debt, net of current portion $   144,873   $   144,383
    Deferred income taxes     30,162       46,622
    Other long-term liabilities     37,073       47,939
         
    Total long-term liabilities     212,108       238,944
         
  Total liabilities     374,188       389,049
         
    Total ATN International, Inc.’s stockholders’ equity     688,727       677,055
    Non-controlling interests     141,496       132,114
         
  Total equity     830,223       809,169
         
    Total liabilities and stockholders’ equity $   1,204,411   $   1,198,218
         

 

                         
                      Table 2  
  ATN International, Inc.  
  Unaudited Condensed Consolidated Statements of Operations  
  (in Thousands, Except per Share Data)  
                       
        Three Months Ended     Year Ended  
      December 31,     December 31,  
          2017       2016         2017       2016    
  Revenues:                      
    Wireless   $   54,096     $   51,498       $   222,040     $   228,798    
    Wireline       44,195         65,777           225,763         188,019    
    Renewable energy         5,702         4,672           20,467         21,608    
    Equipment and other       3,709         6,585           12,923         18,578    
    Total revenue       107,702         128,532           481,193         457,003    
                       
  Operating expenses:                    
    Termination and access fees       21,761         33,618           107,520         111,491    
    Engineering and operations       16,733         19,793           74,614         60,414    
    Sales, marketing and customer service       9,008         8,439           35,184         30,253    
    Equipment expense       4,385         4,200           13,104         14,951    
    General and administrative       24,997         29,381           102,134         91,905    
    Transaction-related charges       123         123           1,009         16,279    
    Restructuring charges         1,169         -            1,169         1,785    
    Depreciation and amortization         21,028         23,067           86,934         75,980    
    Impairment of long-lived assets         -          -            -          11,425    
    Bargain purchase gain         -          -            -          (7,304 )  
    (Gain) loss on sale of assets         (412 )       -            101         27    
    Loss on damaged assets and other hurricane related                      
       charges, net of insurance recovery       (32,610 )       -            3,956         -     
  Total operating expenses       66,182         118,621           425,725         407,206    
                       
  Operating income       41,520         9,911           55,468         49,797    
                       
  Other income (expense):                    
    Interest expense, net       (1,920 )       (1,377 )         (7,225 )       (4,123 )  
    Loss on deconsolidation of subsidiary       -          -            (529 )       -     
    Other income (expense)        1,590         (944 )         (161 )       (300 )  
    Other expense, net       (330 )       (2,321 )         (7,915 )       (4,423 )  
                       
  Income before income taxes       41,190         7,590           47,553         45,374    
    Income tax expense (benefit)       (6,180 )       3,982           (1,341 )       21,160    
                       
  Net Income       47,370         3,608           48,894         24,214    
                         
  Net Income attributable to non-controlling interests, net         (3,871 )       (1,713 )         (17,406 )       (12,113 )  
                         
  Net Income attributable to ATN International, Inc. stockholders   $   43,499     $   1,895       $   31,488     $   12,101    
                       
  Basic net income per weighted average share attributable to ATN International, Inc. stockholders:                      
                         
    Net Income     $   2.71     $   0.12       $   1.95     $   0.75    
                       
  Diluted net income per weighted average share attributable to ATN International, Inc. stockholders:                      
                       
    Net Income    $   2.71     $   0.12       $   1.94     $   0.75    
                       
  Weighted average common shares outstanding:                    
     Basic         16,023         16,139           16,138         16,131    
  Diluted          16,073         16,223           16,210         16,227    
                         

 

     
  Table 3  
  ATN International, Inc.  
  Unaudited Condensed Consolidated Cash Flow Statement  
  (in Thousands)  
       
    Year Ended December 31,  
      2017       2016    
           
    Net income $   48,894     $   24,214    
    Depreciation and amortization     86,934         75,980    
    Stock-based compensation     6,984         6,410    
    Hurricane insurance recovery     (34,606 )        
    Loss on damaged assets from hurricanes     35,443          
    Equity in earnings     2,033         -     
    Bargain purchase gain     -          (7,304 )  
    Impairment of long-lived assets     -          11,425    
    Deferred income taxes     (14,216 )       (5,636 )  
    Pension funding required by Innovative acquisition     -          (22,494 )  
    Change in prepaid and accrued income taxes     322         21,547    
    Change in other operating assets and liabilities     10,259         3,962    
    Other non-cash activity     3,678         3,552    
           
     Net cash provided by operating activities     145,725         111,656    
           
    Capital expenditures     (142,371 )       (124,282 )  
    Acquisition of businesses, net of acquired cash of $0 and $12.6 million     (20,470 )       (146,395 )  
    Sale of business, net of transferred cash of $2.1 million     22,381         -     
    Purchases of spectrum licenses and other intangible assets, including deposits     (36,832 )       (10,860 )  
    Acquisition of non-controlling interest in subsidiary     -          (7,045 )  
    Purchase of marketable securities     -          (2,000 )  
    Purchase of short-term investments           (7,422 )  
    Proceeds from sale of investments     3,797         1,424    
    Change in restricted cash     6,702         (12,108 )  
           
           
     Net cash used in investing activities     (166,793 )       (308,688 )  
           
    Dividends paid on common stock     (19,227 )       (20,965 )  
    Distributions to non-controlling interests     (6,858 )       (8,632 )  
    Principal repayments of term loan     (9,355 )       (33,564 )  
    Proceeds from new borrowings     8,571         125,800    
    Purchases of common stock     (12,855 )       (4,114 )  
    Investments made by minority shareholders in consolidated affiliates     122         22,409    
    Other     (1,321 )       (5,600 )  
           
     Net cash provided by (used in) financing activities     (40,923 )       75,334    
           
  Effect of foreign currency exchange rates on cash and cash equivalents     226         (626 )  
           
  Net change in cash and cash equivalents     (61,765 )       (122,324 )  
           
  Cash and cash equivalents, beginning of period     269,721         392,045    
           
  Cash and cash equivalents, end of period $   207,956     $   269,721    
           

 

            Table 4  
  ATN International, Inc.  
  Selected Segment Financial Information  
  (In Thousands)  
               
  For the three months ended December 31, 2017 is as follows:  
               
    U.S.
Telecom 
International
Telecom
 
Renewable
Energy
 
Corporate and
Other
  *
Total  
               
  Statement of Operations Data:            
  Revenue            
    Wireless $   32,138   $   21,958   $   -    $   -    $   54,096    
    Wireline     2,213       41,982       -        -        44,195    
    Renewable Energy     -        -        5,702       -        5,702    
    Equipment and Other     493       2,991       225       -        3,709    
      Total Revenue $   34,844   $   66,931   $   5,927   $   -    $   107,702    
               
  Operating Income (Loss) $   10,798   $   36,356   $   1,910   $   (7,544 ) $   41,520    
  Non-controlling interest ( net income or (loss) ) $   (1,679 ) $   (1,902 ) $   (290 ) $   -    $   (3,871 )  
               
  Non GAAP measure:            
  Adjusted EBITDA  $   16,793   $   16,788   $   3,637   $   (6,400 ) $   30,818    
               
  Balance Sheet Data (at December 31, 2017):            
  Cash, cash equivalents and investments $   19,585   $   110,702   $   8,120   $   76,625   $   215,032    
  Total current assets     40,975       190,385       18,060       93,507       342,927    
  Fixed assets, net     99,462       367,484       158,447       17,753       643,146    
  Total assets     200,142       629,006       192,407       182,856       1,204,411    
  Total current liabilities     41,248       91,887       14,754       14,191       162,080    
  Total debt     -        94,577       61,215       -        155,792    
               
  ATN International, Inc.  
  Selected Segment Financial Information  
  (In Thousands)  
               
  For the three months ended December 31, 2016 is as follows:  
               
    U.S.
Telecom 
International
Telecom
 
Renewable
Energy
 
Corporate and
Other
  *
Total  
               
  Statement of Operations Data:            
  Revenue            
    Wireless $   30,859   $   20,639   $   -    $   -    $   51,498    
    Wireline     7,655       58,122       -        -        65,777    
    Renewable Energy     -        -        4,672       -        4,672    
    Equipment and Other     510       5,941       134       -        6,585    
      Total Revenue $   39,024   $   84,702   $   4,806   $   -    $   128,532    
               
  Operating Income (Loss) $   9,485   $   7,010   $   488   $   (7,072 ) $   9,911    
  Non-controlling interest ( net income or (loss) ) $   (946 ) $   (478 ) $   (289 ) $   -    $   (1,713 )  
               
  Non GAAP measure:            
  Adjusted EBITDA  $   16,446   $   20,126   $   2,762   $   (6,233 ) $   33,101    
               
  Balance Sheet Data (at December 31, 2016):            
  Cash, cash equivalents and investments $   22,235   $   97,681   $   27,378   $   131,664   $   278,958    
  Total current assets     50,983       143,201       37,440       135,745       367,369    
  Fixed assets, net     129,274       372,741       130,268       15,429       647,712    
  Total assets     240,006       597,454       190,253       170,505       1,198,218    
  Total current liabilities     23,162       95,502       12,603       18,838       150,105    
  Total debt     -        91,316       65,507       -        156,823    
               
  *  Corporate and Other refer to corporate overhead expenses and consolidating adjustments      
               
               
               
  ATN International, Inc.  
  Selected Segment Financial Information  
  (In Thousands)  
               
  For the year ended December 31, 2017 is as follows:  
               
    U.S.
Telecom 
International
Telecom
 
Renewable
Energy
 
Corporate and
Other
  *
Total  
               
  Statement of Operations Data:            
  Revenue            
    Wireless $   140,636   $   81,404   $   -    $   -    $   222,040    
    Wireline     12,656       213,107       -        -        225,763    
    Renewable Energy     -        -        20,467       -        20,467    
    Equipment and Other     2,432       10,092       399       -        12,923    
      Total Revenue $   155,724   $   304,603   $   20,866   $   -    $   481,193    
               
  Operating Income (Loss) $   55,317   $   28,468   $   5,179   $   (33,496 ) $   55,468    
               
  Non-controlling interest ( net income or (loss) ) $   (7,100 ) $   (9,178 ) $   (1,128 ) $   -    $   (17,406 )  
               
  Non GAAP measure:            
  Adjusted EBITDA  $   81,049   $   83,856   $   11,847   $   (28,115 ) $   148,637    
               
  Statement of Cash Flow Data:            
  Capital expenditures $   22,230   $   80,912   $   32,728   $   6,501   $   142,371    
               
               
  ATN International, Inc.  
  Selected Segment Financial Information  
  (In Thousands)  
               
  For the year ended December 31, 2016 is as follows:  
               
    U.S.
Telecom 
International
Telecom
 
Renewable
Energy
 
Corporate and
Other
  *
Total  
               
  Statement of Operations Data:            
  Revenue            
    Wireless $   148,053   $   80,745   $   -    $   -    $   228,798    
    Wireline     26,448       161,571       -        -        188,019    
    Renewable Energy     -        -        21,608       -        21,608    
    Equipment and Other     2,225       15,960       393       -        18,578    
      Total Revenue $   176,726   $   258,276   $   22,001   $   -    $   457,003    
               
  Operating Income (Loss) $   49,078   $   35,436   $   (246 ) $   (34,471 ) $   49,797    
               
  Non-controlling interest ( net income or (loss) ) $   (5,834 ) $   (4,389 ) $   (1,890 ) $   -    $   (12,113 )  
               
  Non GAAP measure:            
  Adjusted EBITDA  $   84,625   $   74,358   $   14,885   $   (25,880 ) $   147,988    
               
  Statement of Cash Flow Data:            
  Capital expenditures $   31,983   $   62,808   $   22,615   $   6,876   $   124,282    
               
               
  *  Corporate and Other refer to corporate overhead expenses and consolidating adjustments      
               
               
               
  ATN International, Inc.  
  Selected Segment Operational Data  
               
    Quarter ended  
    December 31, March 31, June 30, September 30, December 31,  
    2016 * 2017 * 2017 * 2017 * 2017  
               
  U.S. Telecom Operational Data:            
  Wireless - Total Domestic Base Stations     1,006       1,019       1,041       1,061       1,100    
               
               
  International Telecom Operational Data:            
  Wireline - Voice / Access lines     179,700       176,900       174,600       172,300       171,200    
  Wireline - Data Subscribers     97,400       99,900       101,700       102,400       104,900    
  Wireline - Video Subscribers     48,600       47,900       47,200       46,700       45,700    
  Wireless - Subscribers     304,700       302,900       302,900       302,000       307,200    
               
               
  * Adjusted subscriber counts for the sales of St. Maarten and British Virgin Islands, and the transfer of ownership of Aruba business  
               

 

            Table 5  
  ATN International, Inc.  
  Reconciliation of Non-GAAP Measures  
  (In Thousands)  
               
               
  Reconciliation of Net Income to Adjusted EBITDA for the Three Months Ended December 31, 2017 and 2016  
               
  Three Months Ended December 31, 2017  
    U.S.
Telecom 
 International
Telecom

Renewable
Energy
Corporate
and Other *
Total  
   
               
  Net Income attributable to ATN International, Inc.
stockholders
        $   43,499    
  Net Income attributable to non-controlling interests,
net of tax
            3,871    
  Income tax benefit             (6,180 )  
  Other (income) expense, net             (1,590 )  
  Interest expense, net             1,920    
  Operating income $   10,798   $   36,356   $   1,910   $   (7,544 ) $   41,520    
  Depreciation and amortization     6,502       11,669       1,727       1,130       21,028    
  (Gain) loss on sale of assets     (507 )     95       -        -        (412 )  
  Loss on damaged assets and other hurricane
related charges, net of insurance recovery
    -        (32,610 )     -        -        (32,610 )  
  Restructuring charges     -        1,169       -        -        1,169    
  Transaction-related charges     -        109       -        14       123    
  Adjusted EBITDA  $   16,793   $   16,788   $   3,637   $   (6,400 ) $   30,818    
               
               
               
               
  Three Months Ended December 31, 2016  
    U.S.
Telecom 
 International
Telecom

Renewable
Energy
Corporate
and Other *
Total  
   
               
  Net Income attributable to ATN International, Inc.
stockholders
        $   1,895    
  Net Income attributable to non-controlling interests,
net of tax
            1,713    
  Income tax expense             3,982    
  Other (income) expense, net             944    
  Interest expense, net             1,377    
  Operating income $   9,485   $   7,010   $   488   $   (7,072 ) $   9,911    
  Depreciation and amortization     6,961       13,116       1,345       1,645       23,067    
  Transaction-related charges     -        -        929       (806 )     123    
  Adjusted EBITDA  $   16,446   $   20,126   $   2,762   $   (6,233 ) $   33,101    
               
               
               
               
  *  Corporate and Other refer to corporate overhead expenses and consolidating adjustments      
               
               
  Reconciliation of Net Income to Adjusted EBITDA for the Year Ended December 31, 2017 and 2016  
               
  Year Ended December 31, 2017  
    U.S.
Telecom 
 International
Telecom

Renewable
Energy
Corporate
and Other *
Total  
   
               
  Net Income attributable to ATN International, Inc.
stockholders
        $   31,488    
  Net Income attributable to non-controlling interests,
net of tax
            17,406    
  Income tax benefit             (1,341 )  
  Loss on deconsolidation of subsidiary             529    
  Other expense, net             161    
  Interest expense, net             7,225    
  Operating income $   55,317   $   28,468   $   5,179   $   (33,496 ) $   55,468    
  Depreciation and amortization     25,601       50,007       6,668       4,658       86,934    
  (Gain) loss on sale of assets     131       (30 )     -        -        101    
  Loss on damaged assets and other hurricane
related charges, net of insurance recovery
    -        3,956       -        -        3,956    
  Restructuring  charges     -        1,169       -        -        1,169    
  Transaction-related charges     -        286       -        723       1,009    
  Adjusted EBITDA  $   81,049   $   83,856   $   11,847   $   (28,115 ) $   148,637    
               
               
               
               
  Year Ended December 31, 2016  
    U.S.
Telecom 
 International
Telecom

Renewable
Energy
Corporate
and Other *
Total  
   
               
  Net Income attributable to ATN International, Inc.
stockholders
        $   12,101    
  Net Income attributable to non-controlling interests,
net of tax
            12,113    
  Income tax expense             21,160    
  Other expense, net             300    
  Interest expense, net             4,123    
  Operating income $   49,078   $   35,436   $   (246 ) $   (34,471 ) $   49,797    
  Depreciation and amortization     24,471       40,492       4,987       6,030       75,980    
  Impairment of long-lived asset     11,076       349       -        -        11,425    
  Bargain purchase gain     -        (7,304 )     -        -        (7,304 )  
  (Gain) loss on sale of assets     -        27       -        -        27    
  Restructuring charges     -        1,785       -        -        1,785    
  Transaction-related charges     -        3,573       10,144       2,561       16,278    
  Adjusted EBITDA  $   84,625   $   74,358   $   14,885   $   (25,880 ) $   147,988    
               
               
               
  *  Corporate and Other refer to corporate overhead expenses and consolidating adjustments      

 

 
  Table 6
         
  ATN International, Inc.
  (In Thousands)
  Reconciliation of GAAP measures to Non-GAAP measures
         
  Reconciliation of Operating Income (Loss) to Operating Income excluding hurricane charges and insurance recoveries, Net Income (Loss) attributable to ATN stockholders to Net Income (Loss) attributable to ATN stockholders excluding hurricane charges and insurance recoveries and Net Income (Loss) per share attributable to ATN stockholders to Net Income (Loss) per share attributable to ATN stockholders excluding hurricane charges and insurance recoveries
         
  For the Three Months Ended December 31, 2017 is as follows:
         
    Operating Income (Loss) Net Income (Loss)
Attributable to ATN
Stockholders
Net Income (Loss) per
share Attributable to ATN
Stockholders
         
  GAAP - As reported $   41,520   $   43,499   $   2.71  
  Adjust for:  Loss on damaged assets and other
hurricane related charges, net of insurance recovery
    (32,610 )     (32,610 )     (2.03 )
  Tax effect     -        69       0.00  
 
  Non-GAAP $   8,910   $   10,958   $   0.69  
     
         
         
 
  For the Year Ended December 31, 2017 is as follows:
       
    Operating Income (Loss) Net Income (Loss)
Attributable to ATN
Stockholders
Net Income (Loss) per
share Attributable to ATN
Stockholders
         
  GAAP - As reported $   55,468   $   31,488   $   1.94  
  Adjust for:  Loss on damaged assets and other
hurricane related charges, net of insurance recovery
    3,956       3,956       0.24  
  Tax effect     -        -        -   
         
  Non-GAAP  $   59,424   $   35,444   $   2.18  
         

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