| Best
Voip Service Providers Chart |
 |
|
$9.95
- $16.58 |
|
 |
|
$19.99
- $39.99 |
|
 |
|
$9.95
- $15.95 |
|
U.S. Cellular Reports Fourth Quarter 2005 Results; Updates 2006 Guidance29 July 2006
United States Cellular Corporation (Amex: USM) reported service revenues of $738.7 million for the fourth quarter of 2005, up 11 percent from $663 million, as restated, for the comparable period one year ago. The company recorded operating income of $71.6 million during the quarter, up 86 percent compared to $38.4 million for the fourth quarter of 2004, as restated. Net income and basic earnings per share were $42.5 million and $0.49, respectively, compared to net income and basic earnings per share of $38.1 million and $0.44, respectively, as restated, for the comparable period one year ago.
On Dec. 19, 2005, U.S. Cellular completed an exchange of wireless assets with ALLTEL Communications, Inc. Under the agreement, U.S. Cellular received 146,000 total customers in Kansas and Nebraska while ALLTEL received 92,000 total customers in Idaho and $58.1 million in cash, including a preliminary working capital adjustment. In addition to customers, both companies received 850 MHz spectrum, cell sites, retail stores and agents. U.S. Cellular recorded a fourth quarter 2005 pre-tax gain of $44.7 million on the exchange.
In the fourth quarter of 2004, U.S. Cellular recorded a "Gain on sales of assets," included in operating income, of $10.1 million related to the sale of two operating markets to ALLTEL.
Fourth Quarter Highlights
-- Total U.S. Cellular customers increased 11 percent year over year to
5,482,000 customers while retail customers increased 10 percent to
4,927,000.
-- U.S. Cellular recorded a postpay churn rate of 1.6 percent in the
fourth quarter. For the full year 2005, U.S. Cellular's postpay churn
rate was 1.5 percent. 2005 marks the tenth consecutive year that U.S.
Cellular's postpay churn rate has remained below 2 percent.
U.S. Cellular filed its Annual Report (Form 10-K) for the year ended Dec. 31, 2005, with the Securities and Exchange Commission earlier today.
On Nov. 10, 2005, U.S. Cellular announced that it would restate financial results for several prior periods. U.S. Cellular completed and filed its restatement on April 26, 2006. The time spent completing the restatement caused the company to be late with its other SEC filings.
U.S. Cellular has not filed its Form 10-Q for the quarter ended March 31, 2006 on a timely basis. As a result, U.S. Cellular is not in compliance with American Stock Exchange (AMEX) listing standards. U.S. Cellular has been granted an extension until Nov. 14, 2006 to regain compliance with AMEX listing standards resulting from delayed filings with the SEC and delayed distribution of its 2005 annual report to shareholders.
In addition, U.S. Cellular has received extended waivers from its lenders under credit agreements and from counterparties under certain forward contracts provided that it files its Form 10-K for the year ended Dec. 31, 2005 by Aug. 31, 2006, its Form 10-Q for the quarter ended March 31, 2006 within 30 days of filing the 2005 Form 10-K, and its Form 10-Q for the quarter ended June 30, 2006 within 45 days of filing the first quarter Form 10-Q. U.S. Cellular expects to file its Forms 10-Q for the quarter ended Sept. 30, 2006 on or before the extended due date of Nov. 14, 2006.
Certain financial and statistical information will be posted to the U.S. Cellular Web site, together with reconciliations to generally accepted accounting principles (GAAP) of certain non-GAAP disclosures. Investors may access this additional information on the Investor Relations - Financial Information - Guidance & Reconciliations page of the U.S. Cellular Web site.
U.S. Cellular updated its 2006 guidance as of July 28, 2006 and it is as follows. There can be no assurance that final results will not differ materially from this guidance.
Net Retail Customer Additions 370,000 - 400,000
Service Revenues Approx. $3.2 billion
Operating Income $250 - 300 million
Depreciation, Amortization & Accretion $585 million
Capital Expenditures $580 - $610 million
About U.S. Cellular
As of Dec. 31, 2005, U.S. Cellular Corporation, the nation's sixth-largest wireless service carrier, provided wireless service to 5.5 million customers in 26 states. The Chicago-based company operates on a customer satisfaction strategy, meeting customer needs by providing a comprehensive range of wireless products and services, superior customer support and a high-quality network.
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 and projections, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: The ability of the company to successfully manage and grow the operations of the Chicago MTA and newly launched markets; changes in competition in the markets in which the company operates; changes in the overall economy; changes due to industry consolidation; advances in telecommunications technology; changes in the telecommunications regulatory environment; changes in the value of investments, including variable prepaid forward contracts; an adverse change in the ratings afforded our debt securities by accredited ratings organizations; possible future restatements; pending and future litigation; acquisitions/divestitures of properties and/or licenses; and changes in customer growth rates, average monthly revenue per unit, churn rates, roaming rates and the mix of products and services offered in the company's markets. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K used by U.S. Cellular to furnish this press release to the SEC, which are incorporated by reference herein.
For more information about U.S. Cellular, visit: http://www.uscellular.com .
UNITED STATES CELLULAR CORPORATION
SUMMARY OPERATING DATA
Quarter Ended 12/31/2005 9/30/2005 6/30/2005 3/31/2005 12/31/2004
Consolidated Markets:
Total population
(000s)(1) 45,244 44,690 44,690 44,576 44,391
All customers -
Customer
units 5,482,000 5,303,000 5,227,000 5,127,000 4,945,000
Gross customer
unit
activations 419,000 355,000 340,000 426,000 408,000
Net customer
unit
activations 125,000 76,000 94,000 182,000 150,000
Market
penetration(1) 12.12% 11.87% 11.70% 11.50% 11.14%
Retail customers -
Customer
units 4,927,000 4,765,000 4,688,000 4,601,000 4,478,000
Gross customer
unit
activations 392,000 346,000 317,000 365,000 358,000
Net customer
unit
activations 130,000 77,000 81,000 123,000 105,000
Cell sites in
service 5,428 5,149 5,034 4,899 4,856
Average monthly
revenue per
unit(2) $45.94 $46.19 $44.52 $44.46 $45.41
Retail service
revenue per
unit(2) $40.19 $40.25 $39.40 $39.20 $39.93
Inbound roaming
revenue per
unit(2) $2.31 $2.70 $2.27 $1.98 $2.38
Long-distance/other
revenue per
unit(2) $3.44 $3.24 $2.85 $3.28 $3.10
Minutes of
use (MOU)(3) 648 639 627 584 568
Postpay churn rate
per month(4) 1.6% 1.5% 1.4% 1.5% 1.6%
Marketing cost per
gross customer
unit addition(5) $498 $491 $461 $396 $440
Construction
Expenditures
(000s) $201,700 $128,300 $143,800 $112,800 $261,500
(1) Market penetration is calculated using 2004 Claritas population
estimates for all periods of 2005 and 2003 Claritas estimates for all
periods of 2004. "Total population" represents the total population of
each of U.S. Cellular's consolidated markets, regardless of whether
the market has begun marketing operations. The 12/31/05, 9/30/05 and
6/30/05 total population counts include the population of the market
acquired from Cingular Wireless in April 2005. The total population
counts on and after 12/31/04 exclude the population of the two markets
sold to ALLTEL in November 2004. The population of markets in which
U.S. Cellular has deferred the transfer of licenses from AT&T Wireless
(now Cingular Wireless) are not included in the total population
counts for any period, nor are the population counts of markets for
which Carroll Wireless, L.P., a consolidated U.S. Cellular subsidiary,
was the winning bidder in the Federal Communications Commission's
Auction 58 that concluded in February 2005. The total population
counts for 12/31/05 exclude the population of the two markets divested
to ALLTEL in December 2005, and include the population of the 15
markets acquired in the same transaction.
(2) Per unit revenue measurements are derived from Service Revenues as
reported in Financial Highlights for each respective quarter as
follows:
Service Revenues
per
Financial
Highlights $738,682 $729,504 $691,746 $671,639 $662,955
Components:
Retail service
revenue
during
quarter $646,178 $635,610 $612,159 $592,167 $582,950
Inbound roaming
revenue
during
quarter $37,184 $42,654 $35,313 $29,875 $34,812
Long-distance/
other revenue
during
quarter $55,320 $51,240 $44,274 $49,597 $45,193
Divided by average
customers during
quarter (000s) 5,360 5,264 5,179 5,035 4,866
Divided by three
months in each
quarter 3 3 3 3 3
Average monthly
revenue per
unit $45.94 $46.19 $44.52 $44.46 $45.41
Retail service
revenue per
unit $40.19 $40.25 $39.40 $39.20 $39.93
Inbound roaming
revenue per
unit $2.31 $2.70 $2.27 $1.98 $2.38
Long-distance/
other revenue
per unit $3.44 $3.24 $2.85 $3.28 $3.10
(3) Average monthly local minutes of use per customer (without roaming).
(4) Postpay churn rate per month is calculated by dividing the average
monthly postpay customer disconnects during the quarter by the average
postpay customer base for the quarter.
(5) This measurement is not calculable using information from the
financial statements as reported. The details of this calculation and
a reconciliation to line items reported in Financial Highlights for
each respective quarter are shown on U.S. Cellular's web site, along
with additional information related to U.S. Cellular's fourth quarter
results, at http://www.uscellular.com .
UNITED STATES CELLULAR CORPORATION
FINANCIAL HIGHLIGHTS
Three Months Ended December 31,
(Unaudited, dollars in thousands, except per share amounts)
Increase
2004 (Decrease)
2005 (As Restated) Amount Percent
Operating Revenues
Service $738,682 $662,955 $75,727 11.4%
Equipment sales 48,663 46,188 2,475 5.4%
Total Operating Revenues 787,345 709,143 78,202 11.0%
Operating Expenses
System operations (excluding
depreciation shown below) 157,549 126,643 30,906 24.4%
Cost of equipment sold 137,057 129,451 7,606 5.9%
Selling, general and
administrative 337,558 290,243 47,315 16.3%
Depreciation, amortization and
accretion 128,212 134,453 (6,241) (4.6%)
(Gain) on sales of assets (44,660) (10,081) (34,579) N/M
Total Operating Expenses 715,716 670,709 45,007 6.7%
Operating Income 71,629 38,434 33,195 86.4%
Investment and Other Income (Expense)
Investment income 18,424 15,675 2,749 17.5%
Interest and dividend income 4,684 7,608 (2,924) (38.4%)
Interest (expense) (21,563) (21,304) (259) (1.2%)
Gain (loss) on investments (5,400) 27,621 (33,021) N/M
Other (expense), net 337 203 134 66.0%
(3,518) 29,803 (33,321) (111.8%)
Income Before Income Taxes and
Minority Interest 68,111 68,237 (126) (0.2%)
Income tax expense 22,959 27,341 (4,382) (16.0%)
Income Before Minority Interest 45,152 40,896 4,256 10.4%
Minority share of income (2,666) (2,807) 141 5.0%
Net Income $42,486 $38,089 $4,397 11.5%
Basic Weighted Average Common Shares
Outstanding (000s) 87,073 86,344 729 0.8%
Basic Earnings Per Share $0.49 $0.44 0.05 11.4%
Diluted Weighted Average Common
Shares Outstanding (000s) 87,729 86,890 839 1.0%
Diluted Earnings Per Share $0.48 $0.44 $0.04 9.1%
UNITED STATES CELLULAR CORPORATION
FINANCIAL HIGHLIGHTS
Year Ended December 31,
(Unaudited, dollars in thousands, except per share amounts)
2004 Increase (Decrease)
2005 (As Restated) Amount Percent
Operating Revenues
Service $2,831,571 $2,616,946 $214,625 8.2%
Equipment sales 204,316 191,255 13,061 6.8%
Total Operating Revenues 3,035,887 2,808,201 227,686 8.1%
Operating Expenses
System operations (excluding
depreciation shown below) 602,360 562,690 39,670 7.1%
Cost of equipment sold 511,939 486,605 25,334 5.2%
Selling, general and
administrative 1,212,874 1,088,181 124,693 11.5%
Depreciation, amortization
and accretion 509,072 498,202 10,870 2.2%
(Gain) on sales of assets (44,660) (10,806) (33,854) N/M
Total Operating Expenses 2,791,585 2,624,872 166,713 6.4%
Operating Income 244,302 183,329 60,973 33.3%
Investment and Other Income (Expense)
Investment income 68,433 63,758 4,675 7.3%
Interest and dividend income 11,440 10,764 676 6.3%
Interest (expense) (84,867) (86,241) 1,374 1.6%
Gain (loss) on investments (4,849) 25,791 (30,640) (118.8%)
Other (expense), net (199) (2,576) 2,377 92.3%
(10,042) 11,496 (21,538) (187.4%)
Income Before Income Taxes and
Minority Interest 234,260 194,825 39,435 20.2%
Income tax expense 88,404 74,678 13,726 18.4%
Income Before Minority Interest 145,856 120,147 25,709 21.4%
Minority share of income (11,108) (10,631) (477) (4.5%)
Net Income $134,748 $109,516 $25,232 23.0%
Basic Weighted Average Common
Shares Outstanding (000s) 86,775 86,244 531 0.6%
Basic Earnings Per Share $1.55 $1.27 $0.28 22.0%
Diluted Weighted Average Common
Shares Outstanding (000s) 87,464 86,736 728 0.8%
Diluted Earnings Per Share $1.54 $1.26 $0.28 22.2%
N/M - Percentage change not meaningful
UNITED STATES CELLULAR CORPORATION
CONSOLIDATED BALANCE SHEET HIGHLIGHTS
(Unaudited, dollars in thousands)
ASSETS
December 31,
December 31, 2004
2005 (As Restated)
Current Assets
Cash and cash equivalents $29,003 $41,062
Accounts receivable from customers and other 367,510 316,436
Inventory 92,748 76,918
Prepaid expenses 31,026 31,764
Deferred income tax asset 8,218 73,216
Other current assets 15,145 24,951
543,650 564,347
Investments
Licenses 1,362,263 1,228,801
Goodwill 471,617 445,212
Customer lists 49,318 24,915
Marketable equity securities 225,387 282,829
Investments in unconsolidated entities 170,337 155,519
Notes and interest receivable--long-term 4,707 4,885
2,283,629 2,142,161
Property, Plant and Equipment
In service and under construction 4,653,292 4,133,471
Less accumulated depreciation 2,076,528 1,692,751
2,576,764 2,440,720
Other Assets and Deferred Charges 29,985 32,807
Total Assets $5,434,028 $5,180,035
LIABILITIES AND SHAREHOLDERS' EQUITY
December 31,
December 31, 2004
2005 (As Restated)
Current Liabilities
Notes payable $135,000 $30,000
Accounts payable
Affiliates 7,239 5,314
Trade 298,397 259,167
Customer deposits and deferred revenues 106,180 104,394
Accrued taxes 38,627 80,512
Accrued compensation 42,865 49,116
Other current liabilities 25,952 20,829
654,260 549,332
Long-term Debt 1,161,241 1,160,786
Deferred Liabilities and Credits 821,345 840,268
Minority Interest 46,442 40,052
Common Shareholders' Equity
Common Shares, par value $1 per share 55,046 55,046
Series A Common Shares, par value $1 per
share 33,006 33,006
Additional paid-in capital 1,286,964 1,305,249
Treasury Shares (47,088) (99,627)
Accumulated other comprehensive income 24,944 32,803
Retained earnings 1,397,868 1,263,120
2,750,740 2,589,597
Total Liabilities and Shareholders' Equity $5,434,028 $5,180,035
NOTE: Certain December 31, 2004 amounts have been changed to conform to
current period presentation.
Source: prnewswire
All trademarks and copyrighted information contained herein are the property of their respective owners.
Related Telecom Articles
|
