TDS
$19.20
Telephone and Data Systems
($.13)
(.67%)
Earnings Details
2nd Quarter June 2021
Thursday, August 05, 2021 5:27:00 PM
Tweet Share Watch
Summary

Telephone and Data Systems (TDS) Recent Earnings

Telephone and Data Systems (TDS) reported 2nd Quarter June 2021 earnings of $0.17 per share on revenue of $1.3 billion. The consensus earnings estimate was $0.26 per share on revenue of $1.3 billion. Revenue grew 3.8% on a year-over-year basis.

Telephone and Data Systems, Inc. is a diversified telecommunications service company providing telecommunications services to wireless customers and wireline and cable connections.

Results
Reported Earnings
$0.17
Earnings Whisper
-
Consensus Estimate
$0.26
Reported Revenue
$1.31 Bil
Revenue Estimate
$1.31 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

TDS reports second quarter 2021 results

CHICAGO, Aug. 5, 2021 /PRNewswire/ -- 

As previously announced, TDS will hold a teleconference August 6, 2021, at 9:00 a.m. CDT. Listen to the call live via the Events & Presentations page of investors.tdsinc.com  

Telephone and Data Systems, Inc. (NYSE:TDS) reported total operating revenues of $1,311 million for the second quarter of 2021, versus $1,263 million for the same period one year ago. Net income attributable to TDS common shareholders and related diluted earnings per share were $20 million and $0.17, respectively, for the second quarter of 2021 compared to $65 million and $0.56, respectively, in the same period one year ago.

"The TDS family of companies produced solid revenue growth for the second quarter of 2021 and made good progress on achieving our long-term strategic goals," said LeRoy T. Carlson, Jr., TDS President and CEO. "Also, our commitment to maintaining financial flexibility has allowed us to take actions to lower the average cost of financing for our growth initiatives. 

"At UScellular, higher postpaid ARPU helped drive service revenue growth as customers chose higher-value plans. Our efforts to build market share in our prepaid business are starting to generate positive results, and our business and government initiatives are laying the foundation for future growth. UScellular's 5G and network modernization programs are on track. We continue to be very optimistic on the performance capabilities of mmWave spectrum. Additionally, the 5G fixed wireless access tests of market demand have seen early, encouraging results and will provide valuable learnings as we look to bring this high-speed service to market.

"At TDS Telecom, increased broadband connections and customers choosing higher speeds contributed to higher operating revenues for the quarter. 1Gig speeds are available to more than half of all service addresses, and the TDS Telecom fiber footprint is expanding  inside as well as outside of our traditional markets. Performance of our launched fiber expansion markets continues to meet expectations. To take advantage of the fiber opportunities, we are accelerating and upsizing our fiber expansion in the years ahead."

2021 Estimated Results

TDS' current estimates of full-year 2021 results for UScellular and TDS Telecom are shown below. Such estimates represent management's view as of August 5, 2021 and should not be assumed to be current as of any future date. 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.

2021 Estimated Results



UScellular

Previous

Current

(Dollars in millions)



Service revenues

$3,050-$3,150

Unchanged

Adjusted OIBDA1

$850-$950

Unchanged

Adjusted EBITDA1

$1,025-$1,125

Unchanged

Capital expenditures

$775-$875

Unchanged







TDS Telecom

Previous

Current

(Dollars in millions)



Total operating revenues

$975-$1,025

Unchanged

Adjusted OIBDA1

$290-$320

Unchanged

Adjusted EBITDA1

$290-$320

Unchanged

Capital expenditures

$425-$475

Unchanged

The following tables reconcile EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measures, Net income or Income before income taxes. In providing 2021 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.


2021 Estimated Results


UScellular


TDS Telecom

(Dollars in millions)




Net income (GAAP)

N/A


N/A

Add back:




Income tax expense

N/A


N/A

Income before income taxes (GAAP)

$125-$225


$80-$110

Add back:




Interest expense

180




Depreciation, amortization and accretion expense

700



210


EBITDA (Non-GAAP)1

$1,005-$1,105


$290-$320

Add back or deduct:




(Gain) loss on asset disposals, net

20




Adjusted EBITDA (Non-GAAP)1

$1,025-$1,125


$290-$320

Deduct:




Equity in earnings of unconsolidated entities

170




Interest and dividend income

5




Adjusted OIBDA (Non-GAAP)1

$850-$950


$290-$320

 


Actual Results


Six Months Ended

June 30, 2021


Year Ended

December 31, 2020


UScellular


TDS

Telecom


UScellular


TDS

Telecom 

(Dollars in millions)








Net income (GAAP)

$

97



$

46



$

233



$

100


Add back:








Income tax expense

17



15



17



18


Income before income taxes (GAAP)

$

114



$

62



$

250



$

117


Add back:








Interest expense

97



(2)



112



(4)


Depreciation, amortization and accretion expense

350



98



683



203


EBITDA (Non-GAAP)1

$

561



$

157



$

1,045



$

316


Add back or deduct:








(Gain) loss on asset disposals, net

7



1



25



1


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

(1)








(Gain) loss on license sales and exchanges, net





(5)




(Gain) loss on investments





(2)




Adjusted EBITDA (Non-GAAP)1

$

567



$

158



$

1,063



$

317


Deduct:








Equity in earnings of unconsolidated entities

88





179




Interest and dividend income

3





8



5


Other, net







(1)


Adjusted OIBDA (Non-GAAP)1

$

476



$

159



$

876



$

314



Numbers may not foot due to rounding.

1

EBITDA, Adjusted EBITDA and Adjusted OIBDA are defined as net income adjusted for the items set forth in the reconciliation above. EBITDA, Adjusted EBITDA and Adjusted OIBDA are not measures of financial performance under Generally Accepted Accounting Principles in the United States (GAAP) and should not be considered as alternatives to Net income or Cash flows from operating activities, as indicators of cash flows or as measures of liquidity. TDS does not intend to imply that any such items set forth in the reconciliation above are non-recurring, infrequent or unusual; such items may occur in the future. Management uses Adjusted EBITDA and Adjusted OIBDA as measurements of profitability, and therefore reconciliations to Net income are deemed appropriate. Management believes Adjusted EBITDA and Adjusted OIBDA are useful measures of TDS' operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance. Adjusted EBITDA shows adjusted earnings before interest, taxes, depreciation, amortization and accretion, and gains and losses, while Adjusted OIBDA reduces this measure further to exclude Equity in earnings of unconsolidated entities and Interest and dividend income in order to more effectively show the performance of operating activities excluding investment activities. The table above reconciles EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measure, Net income or Income before income taxes. Additional information and reconciliations related to Non-GAAP financial measures for June 30, 2021, can be found on TDS' website at investors.tdsinc.com.

Conference Call Information

TDS will hold a conference call on August 6, 2021 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; broadband, video and voice; and hosted and managed services to approximately 6 million connections nationwide through its businesses, UScellular, TDS Telecom, and OneNeck IT Solutions. Founded in 1969 and headquartered in Chicago, TDS employed approximately 8,900 associates as of June 30, 2021.

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 obtain or maintain roaming arrangements with other carriers on acceptable terms; the ability to obtain access to adequate radio spectrum to meet current or anticipated future needs, including participation in FCC auctions; the ability to attract people of outstanding talent throughout all levels of the organization; TDS' smaller scale relative to larger competitors; changes in demand, consumer preferences and perceptions, price competition, or churn rates; advances in technology; impacts of costs, integration problems or other factors associated with acquisitions, divestitures or exchanges of properties or wireless spectrum licenses and/or expansion of TDS' businesses; the ability of the company to successfully construct and manage its networks; difficulties involving third parties; uncertainties in TDS' future cash flows and liquidity and access to the capital markets; the ability to make payments on TDS and UScellular indebtedness or comply with the terms of debt covenants; conditions in the U.S. telecommunications industry; the value of assets and investments; the state and federal regulatory environment; pending and future litigation; cyber-attacks or other breaches of network or information technology security; disruption in credit or other financial markets; deterioration of U.S. or global economic conditions; the impact, duration and severity of public health emergencies, such as the COVID-19 pandemic. Investors are encouraged to consider these and other risks and uncertainties that are more fully described under "Risk Factors" in the most recent filing of TDS' Form 10-K, as updated by any TDS Form 10-Q filed subsequent to such Form 10-K.    

For more information about TDS and its subsidiaries, visit:

TDS: www.tdsinc.com
UScellular: www.uscellular.com 
TDS Telecom: www.tdstelecom.com 
OneNeck IT Solutions: www.oneneck.com

United States Cellular Corporation

Summary Operating Data (Unaudited)

As of or for the Quarter Ended

6/30/2021


3/31/2021


12/31/2020


9/30/2020


6/30/2020

Retail Connections










Postpaid










Total at end of period

4,399,000



4,406,000



4,412,000



4,401,000



4,372,000


Gross additions

141,000



143,000



171,000



168,000



129,000


Feature phones

3,000



3,000



2,000



4,000



3,000


Smartphones

98,000



101,000



117,000



98,000



82,000


Connected devices

40,000



39,000



52,000



66,000



44,000


Net additions (losses)

(6,000)



(6,000)



11,000



28,000



12,000


Feature phones

(7,000)



(9,000)



(9,000)



(8,000)



(8,000)


Smartphones

6,000



6,000



12,000



8,000



11,000


Connected devices

(5,000)



(3,000)



8,000



28,000



9,000


ARPU1

$

47.74



$

47.65



$

47.51



$

47.10



$

46.24


ARPA2

$

125.25



$

125.25



$

124.87



$

123.27



$

120.70


Churn rate3

1.11

%


1.12

%


1.21

%


1.06

%


0.89

%

Handsets

0.88

%


0.92

%


1.01

%


0.88

%


0.71

%

Connected devices

2.69

%


2.53

%


2.64

%


2.35

%


2.24

%

Prepaid










Total at end of period

507,000



496,000



499,000



506,000



496,000


Gross additions

65,000



62,000



56,000



65,000



62,000


Net additions (losses)

10,000



(3,000)



(8,000)



11,000



2,000


ARPU1

$

35.64



$

35.25



$

35.15



$

35.45



$

34.89


Churn rate3

3.66

%


4.37

%


4.24

%


3.59

%


4.05

%

Total connections at end of period4

4,967,000



4,961,000



4,968,000



4,962,000



4,919,000


Market penetration at end of period










Consolidated operating population

31,493,000



31,493,000



31,314,000



31,314,000



31,292,000


Consolidated operating penetration5

16

%


16

%


16

%


16

%


16

%

Capital expenditures (millions)

$

148



$

125



$

320



$

216



$

168


Total cell sites in service

6,819



6,802



6,797



6,758



6,673


Owned towers

4,278



4,270



4,271



4,246



4,208




1

Average Revenue Per User (ARPU) - metric is calculated by dividing a revenue base by an average number of connections and by the number of months in the period. These revenue bases and connection populations are shown below:


Postpaid ARPU consists of total postpaid service revenues and postpaid connections.


Prepaid ARPU consists of total prepaid service revenues and prepaid connections.

2

Average Revenue Per Account (ARPA) - metric is calculated by dividing total postpaid service revenues by the average number of postpaid accounts and by the number of months in the period.

3

Churn rate represents the percentage of the connections that disconnect service each month. These rates represent the average monthly churn rate for each respective period.

4

Includes reseller and other connections.

5

Market penetration is calculated by dividing the number of wireless connections at the end of the period by the total estimated population of consolidated operating markets.

 

TDS Telecom

Summary Operating Data (Unaudited)

As of or for the Quarter Ended

6/30/2021


3/31/2021


12/31/2020


9/30/2020


6/30/2020

Residential connections










Broadband1










Wireline, Incumbent

249,200



243,700



242,500



243,400



240,400


Wireline, Expansion

28,300



24,100



20,400



17,300



14,700


Cable

201,200



199,500



196,400



193,300



191,000


Total Broadband

478,700



467,300



459,300



454,000



446,000


Video2










Wireline

64,800



63,000



63,000



62,300



61,400


Cable

78,400



79,600



81,400



82,300



83,200


Total Video

143,200



142,700



144,400



144,500



144,600


Voice3










Wireline

254,200



255,000



256,900



260,000



261,800


Cable

54,000



53,700



53,900



54,400



55,300


Total Voice

308,100



308,700



310,800



314,400



317,100


Total Residential connections

930,100



918,700



914,400



913,000



907,800


Commercial connections










Broadband1

34,900



34,400



34,000



33,700



33,400


Video2

19,100



19,400



19,700



19,700



20,300


Voice3

114,300



116,500



119,700



122,700



126,100


ManagedIP4

106,200



108,500



113,300



116,700



117,300


Total Commercial connections

274,400



278,800



286,700



292,900



297,200


Total connections

1,204,500



1,197,400



1,201,100



1,205,900



1,205,000












Residential revenue per connection5

$

57.66



$

56.97



$

55.66



$

55.66



$

53.82












Capital expenditures (millions)

$

99



$

70



$

147



$

92



$

75



Numbers may not foot due to rounding.

1

The individual customers provided high-speed internet access through various transmission technologies, including fiber, DSL, dedicated internet circuit technologies or cable modem service.

2

The individual customers provided video services.

3

The individual circuits connecting a customer to TDS' central office facilities that provide voice services or the billable number of lines into a building for voice services.

4

The number of telephone handsets, data lines and IP trunks providing communications using IP networking technology.

5

Total residential revenue per connection is calculated by dividing total residential revenue by the average number of residential connections and by the number of months in the period.

 

Telephone and Data Systems, Inc.

Consolidated Statement of Operations Highlights

(Unaudited)






Three Months Ended

June 30,


Six Months Ended

June 30,


2021


2020


2021

vs. 2020


2021


2020


2021

vs. 2020

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












Operating revenues












UScellular

$

1,014



$

973



4

%


$

2,037



$

1,937



5

%

TDS Telecom

252



241



5

%


501



481



4

%

All Other1

45



49



(8)

%


91



106



(15)

%


1,311



1,263



4

%


2,629



2,524



4

%

Operating expenses












UScellular












Expenses excluding depreciation, amortization and accretion

796



738



8

%


1,561



1,471



6

%

Depreciation, amortization and accretion

180



178



1

%


350



354



(2)

%

(Gain) loss on asset disposals, net

2



4



(50)

%


7



8



(9)

%

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





N/M


(1)





N/M


978



920



6

%


1,917



1,833



5

%

TDS Telecom












Expenses excluding depreciation, amortization and accretion

174



158



10

%


342



319



7

%

Depreciation, amortization and accretion

49



51



(5)

%


98



103



(5)

%

(Gain) loss on asset disposals, net

1





N/M


1





N/M


224



210



7

%


441



422



5

%

All Other1












Expenses excluding depreciation and amortization

46



49



(6)

%


94



105



(13)

%

Depreciation and amortization

5



7



(17)

%


9



13



(17)

%


51



55



(7)

%


103



118



(14)

%

Total operating expenses

1,253



1,185



6

%


2,461



2,373



4

%

Operating income (loss)












UScellular

36



53



(32)

%


120



104



16

%

TDS Telecom

28



31



(10)

%


60



59



1

%

All Other1

(6)



(6)




(12)



(12)



2

%


58



78



(26)

%


168



151



12

%

Investment and other income (expense)












Equity in earnings of unconsolidated entities

48



44



7

%


90



90



Interest and dividend income

3



2



40

%


6



8



(22)

%

Interest expense

(86)



(38)



N/M


(138)



(75)



(85)

%

Other, net





(11)

%


(1)



(1)



10

%

Total investment and other income (expense)

(35)



8



N/M


(43)



22



N/M

Income before income taxes

23



86



(73)

%


125



173



(28)

%

Income tax expense (benefit)

(11)



8



N/M


20



12



62

%

Net income

34



78



(56)

%


105



161



(35)

%

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

7



13



(44)

%


19



26



(26)

%

Net income attributable to TDS shareholders

27



65



(59)

%


86



135



(36)

%

TDS Preferred Share dividends

7





N/M


9





N/M

Net income attributable to TDS common shareholders

$

20



$

65



(69)

%


$

77



$

135



(43)

%













Basic weighted average shares outstanding

115



114




115



115



Basic earnings per share attributable to TDS common shareholders

$

0.18



$

0.57



(69)

%


$

0.67



$

1.18



(43)

%













Diluted weighted average shares outstanding

116



115



1

%


116



115



Diluted earnings per share attributable to TDS common shareholders

$

0.17



$

0.56



(70)

%


$

0.65



$

1.15



(43)

%


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 UScellular and TDS Telecom segments.

 

 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)


ASSETS






June 30, 2021


December 31, 2020

(Dollars in millions)




Current assets




Cash and cash equivalents

$

385



$

1,429


Short-term investments



3


Accounts receivable, net

1,072



1,112


Inventory, net

189



154


Prepaid expenses

108



105


Income taxes receivable

187



187


Other current assets

50



36


Total current assets

1,991



3,026






Assets held for sale

3



2






Licenses

3,926



2,638






Goodwill

547



547






Other intangible assets, net

207



213






Investments in unconsolidated entities

487



477






Property, plant and equipment, net

3,972



3,972






Operating lease right-of-use assets

1,021



998






Other assets and deferred charges

626



652






Total assets

$

12,780



$

12,525


 

Telephone and Data Systems, Inc.

Consolidated Balance Sheet Highlights

(Unaudited)


LIABILITIES AND EQUITY






June 30, 2021


December 31, 2020

(Dollars in millions, except per share amounts)




Current liabilities




Current portion of long-term debt

$

6



$

5


Accounts payable

374



508


Customer deposits and deferred revenues

199



193


Accrued interest

13



16


Accrued taxes

66



69


Accrued compensation

92



132


Short-term operating lease liabilities

138



129


Other current liabilities

98



101


Total current liabilities

986



1,153






Liabilities held for sale



1






Deferred liabilities and credits




Deferred income tax liability, net

903



863


Long-term operating lease liabilities

951



940


Other deferred liabilities and credits

538



541






Long-term debt, net

3,335



3,424






Noncontrolling interests with redemption features

10



10






Equity




TDS shareholders' equity




Series A Common and Common Shares, par value $0.01 per share

1



1


Capital in excess of par value

2,462



2,482


Preferred Shares, par value $0.01 per share

406




Treasury shares, at cost

(458)



(477)


Accumulated other comprehensive loss

(2)



(4)


Retained earnings

2,812



2,802


Total TDS shareholders' equity

5,221



4,804






Noncontrolling interests

836



789






Total equity

6,057



5,593






Total liabilities and equity

$

12,780



$

12,525


 

Balance Sheet Highlights

(Unaudited)




June 30, 2021




TDS


TDS
Corporate


Intercompany


TDS


UScellular


Telecom


& Other


Eliminations


Consolidated

(Dollars in millions)










Cash and cash equivalents

$

267



$

167



$

119



$

(168)



$

385












Licenses, goodwill and other intangible assets

$

3,917



$

756



$

7



$



$

4,680


Investment in unconsolidated entities

445



4



46



(8)



487



$

4,362



$

760



$

53



$

(8)



$

5,167












Property, plant and equipment, net

$

2,386



$

1,492



$

94



$



$

3,972












Long-term debt, net:










Current portion

$

3



$



$

3



$



$

6


Non-current portion

2,710



4



621





3,335



$

2,713



$

4



$

624



$



$

3,341


 

TDS Telecom Highlights

(Unaudited)














Three Months Ended

June 30,


Six Months Ended

June 30,


2021


2020


2021

vs. 2020


2021


2020


2021

vs. 2020

(Dollars in millions)












Operating revenues












Residential












Wireline, Incumbent

$

86



$

81



7

%


$

171



$

162



6

%

Wireline, Expansion

8



4



81

%


15



8


80

%

Cable

66



60



10

%


131



119



9

%

Total residential

160



145



10

%


317



289



10

%

Commercial

46



48



(4)

%


93



98



(5)

%

Wholesale

45



47



(3)

%


91



94



(3)

%

Total service revenues

251



240



5

%


500



480



4

%

Equipment revenues





5

%


1



1



7

%

Total operating revenues

252



241



5

%


501



481



4

%













Cost of services

101



92



10

%


199



188



6

%

Cost of equipment and products





(12)

%






(7)

%

Selling, general and administrative expenses

73



66



11

%


143



130



10

%

Depreciation, amortization and accretion

49



51



(5)

%


98



103



(5)

%

(Gain) loss on asset disposals, net

1





N/M


1





N/M

Total operating expenses

224



210



7

%


441



422



5

%













Operating income

$

28



$

31



(10)

%


$

60



$

59



1

%


N/M - Percentage change not meaningful

Numbers may not foot due to rounding.

 

Cision View original content:https://www.prnewswire.com/news-releases/tds-reports-second-quarter-2021-results-301349884.html

SOURCE Telephone and Data Systems, Inc.