Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Feb. 14, 2014 | Jun. 30, 2013 | |
Document and Entity Information | ' | ' | ' |
Entity Registrant Name | 'Consolidated Communications Holdings, Inc. | ' | ' |
Entity Central Index Key | '0001304421 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Entity Public Float | ' | ' | $653,300,709 |
Entity Common Stock, Shares Outstanding | ' | 40,065,246 | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONSOLIDATED STATEMENTS OF INCOME | ' | ' | ' |
Net revenues | $601,577 | $477,877 | $349,003 |
Operating expense: | ' | ' | ' |
Cost of services and products (exclusive of depreciation and amortization) | 222,452 | 175,929 | 121,711 |
Selling, general and administrative expenses | 135,414 | 108,163 | 77,724 |
Financing and other transaction costs | 776 | 20,800 | 2,649 |
Impairment of intangible assets | ' | 1,236 | ' |
Depreciation and amortization | 139,274 | 120,332 | 88,090 |
Income from operations | 103,661 | 51,417 | 58,829 |
Other income (expense): | ' | ' | ' |
Interest expense, net of interest income | -85,767 | -72,604 | -49,391 |
Loss on extinguishment of debt | -7,657 | -4,455 | ' |
Investment income | 37,695 | 30,667 | 27,843 |
Other, net | -456 | 601 | 148 |
Income from continuing operations before income taxes | 47,476 | 5,626 | 37,429 |
Income tax expense | 17,512 | 661 | 13,141 |
Income from continuing operations | 29,964 | 4,965 | 24,288 |
Discontinued operations, net of tax: | ' | ' | ' |
Income (loss) from discontinued operations, net of tax | -156 | 1,206 | 2,694 |
Gain on sale of discontinued operations, net of tax | 1,333 | ' | ' |
Total discontinued operations | 1,177 | 1,206 | 2,694 |
Net income | 31,141 | 6,171 | 26,982 |
Less: net income attributable to noncontrolling interest | 330 | 531 | 572 |
Net income attributable to common shareholders | $30,811 | $5,640 | $26,410 |
Net income per common share - basic and diluted | ' | ' | ' |
Income from continuing operations (in dollars per share) | $0.73 | $0.12 | $0.79 |
Discontinued operations, net of tax (in dollars per share) | $0.03 | $0.03 | $0.09 |
Net income per basic and diluted common shares attributable to common shareholders (in dollars per share) | $0.76 | $0.15 | $0.88 |
Dividends declared per common share (in dollars per share) | $1.55 | $1.55 | $1.55 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ' | ' | ' |
Net income | $31,141 | $6,171 | $26,982 |
Pension and post-retirement obligations: | ' | ' | ' |
Change in net actuarial loss and prior service credit, net of tax expense (benefit) of $24,604, $(8,932) and $(8,516) in 2013, 2012 and 2011, respectively | 39,381 | -14,205 | -14,095 |
Amortization of actuarial losses and prior service credit to earnings, net of tax expense of $1,172, $771 and $83 in 2013, 2012 and 2011, respectively | 1,843 | 1,276 | 136 |
Derivative instruments designated as cash flow hedges: | ' | ' | ' |
Change in fair value of derivatives, net of tax benefit of $233, $2,074 and $2,807 in 2013, 2012 and 2011, respectively | -381 | -3,557 | -4,810 |
Reclassification of realized loss to earnings, net of tax expense of $1,934, $5,129 and $7,242 in 2013, 2012 and 2011, respectively | 3,941 | 8,535 | 12,407 |
Comprehensive income (loss) | 75,925 | -1,780 | 20,620 |
Less: comprehensive income attributable to noncontrolling interest | 330 | 531 | 572 |
Total comprehensive income (loss) attributable to common shareholders | $75,595 | ($2,311) | $20,048 |
CONSOLIDATED_STATEMENTS_OF_COM1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ' | ' | ' |
Change in net actuarial loss and prior service credit, tax benefit (expense) | $24,604 | ($8,932) | ($8,516) |
Amortization of actuarial losses and prior service credit to earnings, tax benefit (expense) | 1,172 | 771 | 83 |
Change in fair value of derivatives, tax expense | 233 | 2,074 | 2,807 |
Reclassification of realized (gain) loss to earnings, tax expense | $1,934 | $5,129 | $7,242 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $5,551 | $17,854 |
Accounts receivable, net of allowance for doubtful accounts | 52,033 | 57,957 |
Income tax receivable | 9,796 | 12,020 |
Deferred income taxes | 7,960 | 9,000 |
Prepaid expenses and other current assets | 12,380 | 11,269 |
Assets of discontinued operations | ' | 1,189 |
Total current assets | 87,720 | 109,289 |
Property, plant and equipment, net | 885,362 | 907,672 |
Investments | 113,099 | 109,750 |
Goodwill | 603,446 | 603,446 |
Other intangible assets | 40,084 | 49,530 |
Deferred debt issuance costs, net and other assets | 17,667 | 13,800 |
Total assets | 1,747,378 | 1,793,487 |
Current liabilities: | ' | ' |
Accounts payable | 4,885 | 14,954 |
Advance billings and customer deposits | 25,934 | 27,654 |
Dividends payable | 15,520 | 15,463 |
Accrued compensation | 22,252 | 21,912 |
Accrued expense | 38,697 | 47,225 |
Current portion of long-term debt and capital lease obligations | 9,751 | 9,596 |
Current portion of derivative liability | 660 | 3,164 |
Liabilities of discontinued operations | ' | 4,209 |
Total current liabilities | 117,699 | 144,177 |
Long-term debt and capital lease obligations | 1,212,134 | 1,208,248 |
Deferred income taxes | 179,859 | 137,501 |
Pension and other postretirement obligations | 75,754 | 156,710 |
Other long-term liabilities | 9,593 | 10,746 |
Total liabilities | 1,595,039 | 1,657,382 |
Commitments and contingencies | ' | ' |
Shareholders' equity: | ' | ' |
Common stock, par value $0.01 per share; 100,000,000 shares authorized, 40,065,246 and 39,877,998 shares outstanding as of December 31, 2013 and 2012, respectively | 401 | 399 |
Additional paid-in capital | 148,433 | 177,315 |
Accumulated other comprehensive loss, net | -1,000 | -45,784 |
Noncontrolling interest | 4,505 | 4,175 |
Total shareholders' equity | 152,339 | 136,105 |
Total liabilities and shareholders' equity | $1,747,378 | $1,793,487 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED BALANCE SHEETS | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares outstanding | 40,065,246 | 39,877,998 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss, net | Non-controlling Interest |
In Thousands, unless otherwise specified | ||||||
Balance at Dec. 31, 2010 | $71,875 | $298 | $98,126 | ' | ($31,471) | $4,922 |
Balance (in shares) at Dec. 31, 2010 | ' | 29,763 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' |
Cash dividends on common stock | -46,348 | ' | -19,938 | -26,410 | ' | ' |
Shares issued under employee plan, net of forfeitures | 1 | 1 | ' | ' | ' | ' |
Shares issued under employee plan, net of forfeitures (in shares) | ' | 145 | ' | ' | ' | ' |
Non-cash, stock-based compensation | 2,132 | ' | 2,132 | ' | ' | ' |
Purchase and retirement of common stock | -726 | ' | -726 | ' | ' | ' |
Purchase and retirement of common stock (in shares) | ' | -38 | ' | ' | ' | ' |
Tax on restricted stock vesting | 258 | ' | 258 | ' | ' | ' |
Other comprehensive income (loss) | -6,362 | ' | ' | ' | -6,362 | ' |
Net income | 26,982 | ' | ' | 26,410 | ' | 572 |
Balance at Dec. 31, 2011 | 47,812 | 299 | 79,852 | ' | -37,833 | 5,494 |
Balance (in shares) at Dec. 31, 2011 | ' | 29,870 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' |
Cash dividends on common stock | -57,992 | ' | -52,352 | -5,640 | ' | ' |
Shares issued upon acquisition of SureWest | 148,393 | 100 | 148,293 | ' | ' | ' |
Shares issued upon acquisition of SureWest (in shares) | ' | 9,966 | ' | ' | ' | ' |
Shares issued under employee plan, net of forfeitures (in shares) | ' | 79 | ' | ' | ' | ' |
Non-cash, stock-based compensation | 2,348 | ' | 2,348 | ' | ' | ' |
Purchase and retirement of common stock | -559 | ' | -559 | ' | ' | ' |
Purchase and retirement of common stock (in shares) | ' | -37 | ' | ' | ' | ' |
Tax on restricted stock vesting | 47 | ' | 47 | ' | ' | ' |
Distributions to non-controlling interests | -1,850 | ' | ' | ' | ' | -1,850 |
Other comprehensive income (loss) | -7,951 | ' | ' | ' | -7,951 | ' |
Other | -314 | ' | -314 | ' | ' | ' |
Net income | 6,171 | ' | ' | 5,640 | ' | 531 |
Balance at Dec. 31, 2012 | 136,105 | 399 | 177,315 | ' | -45,784 | 4,175 |
Balance (in shares) at Dec. 31, 2012 | ' | 39,878 | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' |
Cash dividends on common stock | -62,121 | ' | -31,310 | -30,811 | ' | ' |
Shares issued under employee plan, net of forfeitures | 2 | 2 | ' | ' | ' | ' |
Shares issued under employee plan, net of forfeitures (in shares) | ' | 234 | ' | ' | ' | ' |
Non-cash, stock-based compensation | 3,028 | ' | 3,028 | ' | ' | ' |
Purchase and retirement of common stock | -889 | ' | -889 | ' | ' | ' |
Purchase and retirement of common stock (in shares) | ' | -46 | ' | ' | ' | ' |
Tax on restricted stock vesting | 289 | ' | 289 | ' | ' | ' |
Other comprehensive income (loss) | 44,784 | ' | ' | ' | 44,784 | ' |
Net income | 31,141 | ' | ' | 30,811 | ' | 330 |
Balance at Dec. 31, 2013 | $152,339 | $401 | $148,433 | ' | ($1,000) | $4,505 |
Balance (in shares) at Dec. 31, 2013 | ' | 40,066 | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities: | ' | ' | ' |
Net income | $31,141 | $6,171 | $26,982 |
Income from discontinued operations, net of tax | -1,177 | -1,206 | -2,694 |
Income from continuing operations | 29,964 | 4,965 | 24,288 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Depreciation and amortization | 139,274 | 120,332 | 88,090 |
Impairment of intangible assets | ' | 1,236 | ' |
Deferred income taxes | 16,045 | -757 | 8,546 |
Cash distributions from wireless partnerships in excess of/(less than) current earnings | -2,949 | -1,309 | 945 |
Stock-based compensation expense | 3,028 | 2,348 | 2,132 |
Amortization of deferred financing costs | 2,209 | 6,360 | 1,411 |
Loss on extinguishment of debt | 7,657 | 4,455 | ' |
Other, net | 1,788 | -332 | 12 |
Changes in operating assets and liabilities: | ' | ' | ' |
Accounts receivable, net | 5,937 | -1,797 | 6,037 |
Income tax receivable | 2,224 | -2,846 | -2,498 |
Other assets | -1,111 | -803 | 421 |
Accounts payable | -10,069 | 4,496 | 2,175 |
Accrued expenses and other liabilities | -25,467 | -16,616 | -7,257 |
Net cash provided by continuing operations | 168,530 | 119,732 | 124,302 |
Net cash provided by (used in) discontinued operations | -4,174 | 3,483 | 5,202 |
Net cash provided by operating activities | 164,356 | 123,215 | 129,504 |
Cash flows from investing activities: | ' | ' | ' |
Business acquisition, net of cash acquired | ' | -385,346 | ' |
Purchases of property, plant and equipment, net | -107,363 | -76,998 | -41,794 |
Purchase of investments | -403 | -6,728 | ' |
Proceeds from sale of assets | 330 | 924 | 840 |
Other | ' | -314 | 272 |
Net cash used in continuing operations | -107,436 | -468,462 | -40,682 |
Net cash provided by (used in) discontinued operations | 2,331 | -97 | -119 |
Net cash used in investing activities | -105,105 | -468,559 | -40,801 |
Cash flows from financing activities: | ' | ' | ' |
Proceeds on bond offering | ' | 298,035 | ' |
Proceeds from issuance of long-term debt | 989,450 | 544,850 | ' |
Payment of capital lease obligation | -516 | -228 | -149 |
Payment on long-term debt | -990,961 | -510,038 | ' |
Payment of financing costs | -6,576 | -18,616 | -3,471 |
Distributions to noncontrolling interest | ' | -1,850 | ' |
Repurchase and retirement of common stock | -887 | -559 | -726 |
Dividends on common stock | -62,064 | -54,100 | -46,307 |
Net cash provided by (used in) financing activities | -71,554 | 257,494 | -50,653 |
(Decrease)/increase in cash and cash equivalents | -12,303 | -87,850 | 38,050 |
Cash and cash equivalents at beginning of period | 17,854 | 105,704 | 67,654 |
Cash and cash equivalents at end of period | $5,551 | $17,854 | $105,704 |
BUSINESS_DESCRIPTION_SUMMARY_O
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
1. BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||
Business and Basis of Accounting | |||||||||||
Consolidated Communications Holdings, Inc. (the “Company”, “we” or “our”) is a holding company with operating subsidiaries (collectively “Consolidated”) that provide communications services to residential and business customers in Illinois, Texas, Pennsylvania, California, Kansas and Missouri. | |||||||||||
We offer a wide range of telecommunications services to residential and business customers in the areas we serve. Our telecommunications services include local and long-distance service, high-speed broadband Internet access, video services, digital telephone service (“VOIP”), custom calling features, private line services, carrier grade access services, network capacity services over our regional fiber optic networks, directory publishing, Competitive Local Exchange Carrier (“CLEC”) services and equipment sales. As of December 31, 2013, we had approximately 257 thousand access lines, 123 thousand voice connections, 255 thousand data and Internet connections and 111 thousand video connections. | |||||||||||
We historically operated our business as two separate reportable segments: Telephone Operations and Other Operations. Based on changes in our business structure, during the quarter ended June 30, 2013 we concluded that we operate our business as one reportable segment. See the Recent Business Developments section below for a more detailed discussion regarding the circumstances that resulted in the change to our segment reporting. | |||||||||||
Use of Estimates | |||||||||||
Preparation of the financial statements in conformity with accounting principles generally accepted in the United States and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ materially from those estimates. Our critical accounting estimates include (i) impairment evaluations associated with indefinite-lived intangible assets (Note 1), (ii) revenue recognition (Note 1), (iii) derivatives (Notes 1 and 7), (iv) the determination of deferred tax asset and liability balances (Notes 1 and 10) and (v) pension plan and other post-retirement costs and obligations (Notes 1 and 9). Events subsequent to the balance sheet date have been evaluated for inclusion in the accompanying consolidated financial statements through the date of issuance. | |||||||||||
Principles of Consolidation | |||||||||||
Our consolidated financial statements include the accounts of the Company and our wholly-owned subsidiaries and subsidiaries in which we have a controlling financial interest. All significant intercompany transactions have been eliminated. | |||||||||||
Recent Business Developments | |||||||||||
Segment Reporting | |||||||||||
Historically, we classified our operations into two separate reportable business segments: Telephone Operations and Other Operations. Our Telephone Operations consisted of a wide range of telecommunications services to residential and business customers, including local and long-distance service, high-speed broadband Internet access, video services, VOIP services, custom calling features, private line services, carrier access services, network capacity services over a regional fiber optic network, mobile services and directory publishing. Our Other Operations segment operated two complementary non-core businesses including telephone services to state and county correctional facilities (“Prison Services”) and equipment sales. As discussed below, our contract to provide telephone services to correctional facilities operated by the Illinois Department of Corrections was not renewed and the process of transitioning those services to another service provider was completed during the quarter ended March 31, 2013. The remaining prison services assets and operations were classified as discontinued operations during the quarter ended June 30, 2013 and subsequently sold during the quarter ended September 30, 2013. Prison Services comprised nearly all of the Other Operations segment revenue and results of operations. Consequently, with the cessation of our Prison Services business and based on the segment accounting guidance, we concluded that we operate as one segment as of the quarter ended June 30, 2013. As required by the authoritative guidance for segment presentation, segment results of operations have been retrospectively adjusted to reflect this change for all periods presented. | |||||||||||
Prison Services Contract | |||||||||||
We previously provided telephone service to inmates incarcerated at facilities operated by the Illinois Department of Corrections and to certain county jails. On June 27, 2012, the Illinois Department of Central Management Services announced its intent to replace us as the provider of those services with a competitor. Although we challenged our competitor’s bid and the State’s decision to accept that bid in a variety of different forums, during the quarter ended March 31, 2013, the process of transitioning these services to another service provider was completed. All related assets have been assessed for recoverability in light of this change and we determined that no impairment was necessary. During 2012, the prison services contract comprised 5% of consolidated operating revenues and approximately 2% of consolidated operating income, excluding financing and other transaction fees. | |||||||||||
Discontinued Operations | |||||||||||
On September 13, 2013, we completed the sale of the assets and contractual rights used to provide communications services to inmates in thirteen county jails located in Illinois for a total purchase price of $2.5 million. In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 205-20, “Discontinued Operations”, the financial results of the prison services business have been reported as a discontinued operation in our consolidated financial statements for all periods presented. For a more complete discussion of the transaction, refer to Note 3. | |||||||||||
SureWest Merger | |||||||||||
We completed the acquisition of SureWest Communications on July 2, 2012. SureWest Communications’ results of operations are included within our results following the acquisition date. For a more complete discussion of the transaction, refer to Note 2. | |||||||||||
Cash and Cash Equivalents | |||||||||||
We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Our cash equivalents consist primarily of money market funds. The carrying amounts of our cash equivalents approximate their fair value. | |||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | |||||||||||
Accounts receivable consist primarily of amounts due to the Company from normal activities. We maintain an allowance for doubtful accounts for estimated losses, which result from the inability of our customers to make required payments. Such allowance is based on the likelihood of recoverability of accounts receivable based on past experience and management’s best estimates of current bad debt exposures. We perform ongoing credit evaluations of our customers’ financial condition and management believes that adequate allowances for doubtful accounts have been provided. Accounts are determined to be past due if customer payments have not been received in accordance with the payment terms. Uncollectible accounts are charged against the allowance for doubtful accounts and removed from the accounts receivable balances when internal collection efforts have been unsuccessful in collecting the amount due. The following table summarizes the activity in our accounts receivable allowance account for the years ended December 31, 2013, 2012 and 2011: | |||||||||||
Year Ended December 31, | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Balance at beginning of year | $ | 4,025 | $ | 2,547 | $ | 2,694 | |||||
Provision charged to expense | 515 | 5,615 | 4,104 | ||||||||
Write-offs, less recoveries | -2,942 | -4,137 | -4,251 | ||||||||
Balance at end of year | $ | 1,598 | $ | 4,025 | $ | 2,547 | |||||
Investments | |||||||||||
Our investments are primarily accounted for under either the equity or cost method. If we have the ability to exercise significant influence over the operations and financial policies of an affiliated company, the investment in the affiliated company is accounted for using the equity method. If we do not have control and also cannot exercise significant influence, the investment in the affiliated company is accounted for using the cost method. | |||||||||||
We review our investment portfolio periodically to determine whether there are identified events or circumstances that would indicate there is a decline in the fair value that is considered to be other than temporary. If we believe the decline is other than temporary, we evaluate the financial performance of the business and compare the carrying value of the investment to quoted market prices (if available) or the fair value of similar investments. If an investment is deemed to have experienced an impairment that is considered other-than temporary, the carrying amount of the investment is reduced to its quoted or estimated fair value, as applicable, and an impairment loss is recognized in other income (expense). | |||||||||||
Fair Value of Financial Instruments | |||||||||||
We account for certain assets and liabilities at fair value. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A financial asset or liability’s classification within a three-tiered value hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The hierarchy prioritizes the inputs to valuation techniques into three broad levels in order to maximize the use of observable inputs and minimize the use of unobservable inputs. The levels of the fair value hierarchy are as follows: | |||||||||||
Level 1 – Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. | |||||||||||
Level 2 – Inputs that reflect quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets and inputs other than quoted prices that are directly or indirectly observable in the marketplace. | |||||||||||
Level 3 – Unobservable inputs which are supported by little or no market activity. | |||||||||||
Property, Plant and Equipment | |||||||||||
Property, plant and equipment are recorded at cost. We capitalize additions and substantial improvements and expense repairs and maintenance costs as incurred. | |||||||||||
We capitalize the cost of internal-use network and non-network software which has a useful life in excess of one year. Subsequent additions, modifications or upgrades to internal-use network and non-network software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. Software maintenance and training costs are expensed in the period in which they are incurred. Also, we capitalize interest associated with the development of internal-use network and non-network software. | |||||||||||
Property, plant and equipment consisted of the following as of December 31, 2013 and 2012: | |||||||||||
(In thousands) | December 31, | December 31, | Estimated | ||||||||
2013 | 2012 | Useful Lives | |||||||||
Land and buildings | $ | 98,663 | $ | 94,929 | 18-40 years | ||||||
Network and outside plant facilities | 1,543,190 | 1,462,875 | 3-50 years | ||||||||
Furniture, fixtures and equipment | 99,578 | 95,671 | 3-15 years | ||||||||
Assets under capital lease | 11,169 | 10,375 | 3-11 years | ||||||||
Total plant in service | 1,752,600 | 1,663,850 | |||||||||
Less: accumulated depreciation and amortization | -899,926 | -779,461 | |||||||||
Plant in service | 852,674 | 884,389 | |||||||||
Construction in progress | 23,586 | 12,899 | |||||||||
Construction inventory | 9,102 | 10,384 | |||||||||
Totals | $ | 885,362 | $ | 907,672 | |||||||
Construction inventory, which is stated at weighted average cost, consists primarily of network construction materials and supplies that when issued are predominately capitalized as part of new customer installations and the construction of the network. | |||||||||||
We record depreciation using the straight line method over estimated useful lives using either the group or unit method. The useful lives are estimated at the time the assets are acquired and are based on historical experience with similar assets, anticipated technological changes and the expected impact of our strategic operating plan on our network infrastructure. The group method is used for depreciable assets dedicated to providing regulated telecommunication services, including the majority of the network and outside plant facilities. A depreciation rate for each asset group is developed based on the average useful life of the group. The group method requires periodic revision of depreciation rates. | |||||||||||
When an individual asset is sold or retired, the difference between the proceeds, if any, and the cost of the asset is charged or credited to accumulated depreciation, without recognition of a gain or loss. | |||||||||||
The unit method is primarily used for buildings, furniture, fixtures and other support assets. Each asset is depreciated on the straight-line basis over its estimated useful life. When an individual asset is sold or retired, the cost basis of the asset and related accumulated depreciation are removed from the accounts and any associated gain or loss is recognized. | |||||||||||
Depreciation and amortization expense was $129.9 million, $98.3 million and $66.3 million in 2013, 2012 and 2011, respectively. Amortization of assets under capital leases is included in depreciation and amortization expense. | |||||||||||
We evaluate the recoverability of our property, plant and equipment whenever events or substantive changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset group to estimated undiscounted future cash flows expected to be generated by the asset group. If the total of the expected future undiscounted cash flows were less than the carrying amount of the asset group, we would recognize an impairment charge for the difference between the estimated fair value and the carrying value of the asset group. | |||||||||||
Intangible Assets | |||||||||||
Indefinite-Lived Intangibles | |||||||||||
Goodwill and tradenames are evaluated for impairment annually or more frequently when events or changes in circumstances indicate that the asset might be impaired. We evaluate the carrying value of our indefinite-lived assets, tradenames and goodwill, as of November 30 of each year. As noted above, during the quarter ended June 30, 2013, we became a single reporting segment. As such we now evaluate our intangibles based on the single reporting segment. | |||||||||||
Tradenames | |||||||||||
Our most valuable tradename is the federally registered mark CONSOLIDATED, a design of interlocking circles, which is used in association with our telephone communication services. The Company’s corporate branding strategy leverages a CONSOLIDATED naming structure. With the acquisition of SureWest on July 2, 2012, we also own the tradenames associated with SureWest. All of the Company’s business units and several of our products and services incorporate the CONSOLIDATED name, except for the SureWest business units. We do not amortize our tradenames, as we have determined that they have an indefinite life. If facts and circumstances change relating to a tradenames continued use in the branding of our products and services, it may be treated as a finite-lived asset and begin to be amortized over its estimated remaining life. We estimate the fair value of our tradenames using discounted cash flows (“DCF”) based on a relief from royalty method. If the fair value of our tradenames was less than the carrying amount, we would recognize an impairment charge for the difference between the estimated fair value and the carrying value of the assets. We perform our impairment testing of our tradenames as single units of accounting based on their use in our single reporting unit. During the year ending December 31, 2013, a formal one-year plan to transition from the SureWest tradename to the CONSOLIDATED tradename was adopted. We began to amortize the $0.9 million assigned to the SureWest tradename over its estimated one-year useful life. During 2013, we recognized $0.5 million in amortization expense associated with the SureWest tradename. At December 31, 2013, the unamortized amount related to the SureWest tradename was $0.4 million. | |||||||||||
The carrying value of the reporting unit tradename, excluding any amounts assigned to the SureWest tradename, was $10.6 million at December 31, 2013 and 2012. For the years ended December 31, 2013 and 2012, we completed our annual impairment test using a DCF methodology based on a relief from royalty method and determined that there was no impairment of our tradename. During our annual assessment of carrying value of our tradenames in 2012, we determined that the carrying value of the tradename associated with the Business Systems reporting unit, which was previously included in our Other Operations segment, exceeded the estimated fair value and was impaired. During the quarter ended December 31, 2012, we recorded an impairment charge of $0.3 million to write off the carrying value of the tradename associated with the Business Systems reporting unit. | |||||||||||
Goodwill | |||||||||||
Goodwill is the excess of the acquisition cost of a business over the fair value of the identifiable net assets acquired. As noted above, goodwill is not amortized but instead evaluated annually for impairment using a preliminary qualitative assessment and two-step process, if deemed necessary. In 2012, we adopted an Accounting Standards Update No. 2011-08 – Intangibles-Goodwill and Other (Topic 350) Testing Goodwill for Impairment, that allows an entity to consider qualitative indicators to determine if the current two-step test is necessary. Under the provisions of the amended guidance, the step-one test of a reporting unit’s fair value is not required unless, as a result of the qualitative assessment, it is more likely than not (a likelihood of more than 50%) that fair value of the reporting unit is less than its carrying amount. Events and circumstances integrated into the qualitative assessment process include a combination of macroeconomic conditions affecting equity and credit markets, significant changes to the cost structure, overall financial performance and other relevant events affecting the reporting unit. A company is permitted to skip the qualitative assessment at its election, and proceed to Step 1 of the quantitative test, which we chose to do in 2013. In the first step of the impairment test, the fair value of our reporting unit is compared to its carrying amount, including goodwill. | |||||||||||
The estimated fair value of the reporting unit is determined using a combination of market-based approaches and a DCF model. The assumptions used in the estimate of fair value are based upon a combination of historical results and trends, new industry developments and future cash flow projections, as well as relevant comparable company earnings multiples for the market-based approaches. Such assumptions are subject to change as a result of changing economic and competitive conditions. We use a weighting of the results derived from the valuation approaches to estimate the fair value of the reporting unit. The fair value of the reporting unit exceeded the carrying value at December 31, 2013. | |||||||||||
If the carrying value of the reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss. In measuring the fair value of our reporting unit as previously described, we consider the combined carrying and fair values of our reporting unit in relation to our overall enterprise value, measured as the publicly traded stock price multiplied by the fully diluted shares outstanding plus the value of outstanding debt. Our reporting unit fair value models are consistent with a range in value indicated by both the preceding three month average stock price and the stock price on the valuation date, plus an estimated acquisition premium which is based on observable transactions of comparable companies, if applicable. | |||||||||||
The second step compares the implied fair value of the reporting unit goodwill with the carrying amount of that goodwill. The implied fair value is determined by allocating the fair value of the reporting unit to all of the assets and liabilities other than goodwill in a manner similar to a purchase price allocation. The excess of the fair value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. If the carrying amount of goodwill is greater than the implied fair value of that goodwill, then an impairment charge would be recorded equal to the difference between the implied fair value and the carrying value. At December 31, 2013 and 2012, the carrying value of goodwill was $603.4 million. | |||||||||||
For the 2012 evaluation, we used a DCF model to estimate the fair value of the Business Systems reporting unit, which was previously included in the Other Operations reporting segment. For the Business Systems reporting unit, the carrying value exceeded the fair value indicating a potential impairment existed. In the 2012 evaluation, we determined that based on the allocation of the fair value of the reporting unit to assets and liabilities in the second step of the impairment testing that the goodwill recorded for the Business Systems reporting unit was impaired and recorded an impairment charge of $0.8 million during the year ended December 31, 2012. | |||||||||||
Finite-Lived Intangible Assets | |||||||||||
Customer Lists | |||||||||||
Finite lived intangible assets subject to amortization consist primarily of our customer lists of an established base of customers that subscribe to our services. Customer lists are amortized on a straight-line basis over their estimated useful lives (ranging from 3 to 13 years) based upon our historical experience with customer attrition. In accordance with the applicable guidance relating to the impairment or disposal of long-lived assets, we evaluate the potential impairment of finite-lived intangible assets when impairment indicators exist. If the carrying value is no longer recoverable based upon the undiscounted future cash flows of the asset, an impairment equal to the difference between the carrying amount and the fair value of the asset is recognized. | |||||||||||
The net carrying amount of our customer lists as of December 31, 2013 and 2012 were as follows: | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Gross carrying amount | $ | 195,651 | $ | 195,651 | |||||||
Less: accumulated amortization | -166,500 | -157,579 | |||||||||
Net carrying amount | $ | 29,151 | $ | 38,072 | |||||||
Amortization expense for the years ended December 31, 2013, 2012 and 2011 was $8.9 million, $22.1 million and $21.8 million, respectively. The weighted-average remaining period over which customer lists are being amortized is 2.13 years. Expected amortization expense for the years 2014 through 2017 is as follows: | |||||||||||
(In thousands) | |||||||||||
2014 | $ | 8,921 | |||||||||
2015 | 8,849 | ||||||||||
2016 | 8,776 | ||||||||||
2017 | 2,605 | ||||||||||
Total | $ | 29,151 | |||||||||
Derivative Financial Instruments | |||||||||||
We use derivative financial instruments to manage our exposure to the risks associated with fluctuations in interest rates. Our interest rate swap agreements effectively convert a portion of our floating-rate debt to a fixed-rate basis, thereby reducing the impact of interest rate changes on future cash interest payments. At the inception of a hedge transaction, we formally document the relationship between the hedging instruments including our objective and strategy for establishing the hedge. In addition, the effectiveness of the derivative instrument is assessed at inception and on an ongoing basis throughout the hedging period. Counterparties to derivative instruments expose us to credit-related losses in the event of nonperformance. We execute agreements only with financial institutions we believe to be creditworthy and regularly assess the credit worthiness of each of the counterparties. We do not use derivative instruments for trading or speculative purposes. | |||||||||||
Derivative financial instruments are recorded at fair value in our consolidated balance sheet. Fair value is determined based on publicly available interest rate yield curves and an estimate of our nonperformance risk or our counterparty’s nonperformance credit risk, as applicable. We do not anticipate any nonperformance by any counterparty. | |||||||||||
For derivative instruments designated as a cash flow hedge, the effective portion of the change in the fair value is recognized as a component of accumulated other comprehensive income (loss) (“AOCI”) and is recognized as an adjustment to earnings over the period in which the hedged item impacts earnings. When an interest rate swap agreement terminates, any resulting gain or loss is recognized over the shorter of the remaining original term of the hedging instrument or the remaining life of the underlying debt obligation. The ineffective portion of the change in fair value of any hedging derivative is recognized immediately in earnings. If a derivative instrument is de-designated, the remaining gain or loss in AOCI on the date of de-designation is amortized to earnings over the remaining term of the hedging instrument. For derivative financial instruments that are not designated as a hedge, changes in fair value are recognized on a current basis in earnings. Cash flows from hedging activities are classified under the same category as the cash flows from the hedged items in our consolidated statement of cash flows. See Note 7 for further discussion of our derivative financial instruments. | |||||||||||
Share-based Compensation | |||||||||||
Our share-based compensation consists of the issuance of restricted stock awards (“RSAs”) and performance share awards (“PSAs”) (collectively “stock awards”). Associated costs are based on a stock award’s estimated fair value at the date of the grant and are recognized over a period in which any related services are provided. We recognize the cost of RSAs and PSAs on a straight-line basis over the requisite service period, generally from immediate vest to a four-year vesting period. See Note 8 for further details regarding share-based compensation. | |||||||||||
Pension Plan and Other Post-Retirement Benefits | |||||||||||
We maintain noncontributory defined benefit pension plans and provide certain post-retirement benefits other than pensions to certain eligible employees. We also maintain two unfunded supplemental retirement plans to provide incremental pension payments to certain former employees. | |||||||||||
We recognize pension expense during the current period in the consolidated income statement using certain assumptions, including the expected long-term rate of return on plan assets, interest cost implied by the discount rate and the amortization of unrecognized gains and losses. Refer to Note 9 for further details regarding the determination of these assumptions. | |||||||||||
We recognize the overfunded or underfunded status of our defined benefit pension and post-retirement plans as either an asset or liability in the consolidated balance sheet. We recognize changes in the funded status in the year | |||||||||||
in which the changes occur through comprehensive income, net of applicable income taxes, including unrecognized actuarial gains and losses and prior service costs and credits. | |||||||||||
Income Taxes | |||||||||||
Our estimates of income taxes and the significant items resulting in the recognition of deferred tax assets and liabilities are disclosed in Note 10 and reflect our assessment of future tax consequences of transactions that have been reflected in our financial statements or tax returns for each taxing jurisdiction in which we operate. We base our provision for income taxes on our current period income, changes in our deferred income tax assets and liabilities, income tax rates, changes in estimates of our uncertain tax positions and tax planning opportunities available in the jurisdictions in which we operate. We recognize deferred tax assets and liabilities when there are temporary differences between the financial reporting basis and tax basis of our assets and liabilities and for the expected benefits of using net operating loss and tax credit loss carryforwards. We establish valuation allowances when necessary to reduce the carrying amount of deferred income tax assets to the amounts that we believe are more likely than not to be realized. We evaluate the need to retain all or a portion of the valuation allowance on our deferred tax assets. When a change in the tax rate or tax law has an impact on deferred taxes, we apply the change based on the years in which the temporary differences are expected to reverse. As we operate in more than one state, changes in our state apportionment factors, based on operational results, may affect our future effective tax rates and the value of our deferred tax assets and liabilities. We record a change in tax rates in our consolidated financial statements in the period of enactment. | |||||||||||
Income tax consequences that arise in connection with a business combination include identifying the tax basis of assets and liabilities acquired and any contingencies associated with uncertain tax positions assumed or resulting from the business combination. Deferred tax assets and liabilities related to temporary differences of an acquired entity are recorded as of the date of the business combination and are based on our estimate of the appropriate tax basis that will be accepted by the various taxing authorities. | |||||||||||
We record unrecognized tax benefits as liabilities in accordance with ASC 740 and adjust these liabilities in the appropriate period when our judgment changes as a result of the evaluation of new information. In certain instances, the ultimate resolution may result in a payment that is materially different from our current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. We classify interest and penalties, if any, associated with our uncertain tax positions as a component of interest expense and general and administrative expense, respectively. See Note 10 for additional information on income taxes. | |||||||||||
Revenue Recognition | |||||||||||
We recognize revenue when (i) persuasive evidence of an arrangement exists between us and the customer, (ii) delivery of the product to the customer has occurred or service has been provided to the customer, (iii) the price to the customer is fixed or determinable and (iv) collectability of the sales price is reasonably assured. Revenues based on a flat fee, derived principally from local telephone, dedicated network access, data communications, Internet access service and residential/business broadband service are billed in advance and recognized in subsequent periods when the services are provided, with the exception of certain governmental accounts which are billed in arrears. Revenues for usage-based services, such as per-minute long-distance service and access charges billed to other telephone carriers for originating and terminating long-distance calls on our network, are billed in arrears. We recognize revenue from these services in the period the services are rendered rather than billed. Earned but unbilled usage-based services are recorded in accounts receivable. | |||||||||||
When required as part of providing service, revenues related to nonrefundable, upfront service activation and setup fees are deferred and recognized over the estimated customer life. | |||||||||||
Incremental direct costs of telecommunications service activation are charged to expense in the period in which they are incurred, except when we maintain ownership of wiring installed during the activation process. In such cases the cost is capitalized and depreciated over the estimated useful life of the asset. | |||||||||||
Telephone equipment revenues generated from retail channels are recorded at the point of sale. Telecommunications systems and structured cabling project revenues are recognized when the project is completed. Maintenance services are provided on both a contract and time and material basis and are recorded when the service is provided. Print advertising and publishing revenues are recognized ratably over the life of the related directory, generally 12 months. | |||||||||||
Subsidies, including universal service revenues, are government-sponsored support mechanisms to assist in funding services in mostly rural, high-cost areas. These revenues typically are based on information we provide and are calculated by the administering government agency. Subsidies are recognized in the period the service is provided. There is a reasonable possibility that out of period subsidy adjustments may be recorded in the future, but they are anticipated to be immaterial to our results of operation, financial position and cash flow. | |||||||||||
We collect and remit Federal Universal Service contributions on a gross basis, which resulted in recorded revenue of approximately $12.0 million for the year ended December 31, 2013. We account for all other taxes collected from customers and remitted to the respective government agencies on a net basis. | |||||||||||
Advertising Costs | |||||||||||
Advertising costs are expensed as incurred. Advertising expense was $7.6 million, $5.1 million and $2.4 million in 2013, 2012 and 2011, respectively. | |||||||||||
Statement of Cash Flows Information | |||||||||||
During 2013, 2012 and 2011, we made payments for interest and income taxes as follows: | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Interest, net of amounts capitalized ($1,215, $515 and $144 in 2013, 2012 and 2011, respectively) | $ | 80,693 | $ | 63,541 | $ | 47,071 | |||||
Income taxes paid, net | $ | 960 | $ | 4,991 | $ | 8,788 | |||||
Noncash investing and financing activities: | |||||||||||
As described in Note 3, we issued $148.4 million in shares of the Company’s common stock in connection with the acquisition of SureWest in 2012. | |||||||||||
In 2013 and 2012, we acquired equipment of $0.8 million and $0.4 million, respectively, through capital lease agreements. | |||||||||||
Noncontrolling Interest | |||||||||||
We have a majority-owned subsidiary, East Texas Fiber Line Incorporated (“ETFL”) which is a joint venture owned 63% by the Company and 37% by Eastex Telecom Investments, LLC. ETFL provides connectivity over a fiber optic transport network to certain customers residing in Texas. | |||||||||||
Recent Accounting Pronouncements | |||||||||||
In July 2013, the FASB issued the Accounting Standards Update No. 2013-11 (“ASU 2013-11”), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 provides guidance concerning the balance sheet presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward is present. The amended guidance is effective for fiscal years and interim periods beginning after December 15, 2013, with early adoption permitted. We are currently evaluating the impact this update will have on our consolidated financial statements. | |||||||||||
Effective January 1, 2013, we adopted Accounting Standards Update No. 2012-02 (“ASU 2012-02”), Testing Indefinite-Lived Intangible Assets for Impairment. ASU 2012-02 permits an entity to perform an initial assessment of qualitative factors to determine whether it is more likely than not that a non-goodwill indefinite-lived intangible asset is impaired and thus whether it is necessary to calculate the asset’s fair value for the purpose of comparing it with the asset’s carrying amount. The adoption of this standard did not have a material impact on our consolidated financial statements. | |||||||||||
Effective January 1, 2013, we adopted Accounting Standards Update No. 2013-02 (“ASU 2013-02”), Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which establishes new requirements for disclosing reclassifications of items out of accumulated other comprehensive income (“OCI”). ASU 2013-2 requires disclosures for the (i) changes in components of accumulated OCI, (ii) effects on individual line items in net income for each item of accumulated OCI that is reclassified in its entirety to net income, and (iii) cross references to other disclosures that provide additional details for OCI items that are not reclassified in their entirety to net income. For public companies, amendments were effective prospectively for reporting periods beginning after December 15, 2012, with early adoption permitted. In accordance with the provisions of this guidance, disclosures related to accumulated OCI can be found in Note 8. | |||||||||||
Reclassifications | |||||||||||
Certain amounts in our 2012 and 2011 consolidated financial statements have been reclassified to conform to the presentation of our 2013 consolidated financial statements which consists of the effects of reclassifications from the presentation of prison services as a discontinued operation and the finalization of purchase accounting for the SureWest acquisition. These reclassifications had no effect on total shareholders’ equity, total revenue or net income. | |||||||||||
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
EARNINGS PER SHARE | ' | ||||||||||
EARNINGS PER SHARE | ' | ||||||||||
2. EARNINGS PER SHARE | |||||||||||
We compute net income per share using the two-class method. The two-class method is an earnings allocation formula that determines income per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. Basic net income per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net income attributable to our shareholders is computed using the weighted-average number of common shares and the effect of potentially dilutive securities outstanding during the period. Potentially dilutive shares consist of restricted shares. | |||||||||||
The computation of basic and diluted earnings per share attributable to common shareholders is as follows: | |||||||||||
(In thousands, except per share amounts) | 2013 | 2012 | 2011 | ||||||||
Income from continuing operations | $ | 29,964 | $ | 4,965 | $ | 24,288 | |||||
Less: net income attributable to noncontrolling interest | 330 | 531 | 572 | ||||||||
Income attributable to common shareholders before allocation of earnings to participating securities | 29,634 | 4,434 | 23,716 | ||||||||
Less: earnings allocated to participating securities | 466 | 351 | 429 | ||||||||
Income from continuing operations attributable to common shareholders | 29,168 | 4,083 | 23,287 | ||||||||
Net income from discontinued operations | 1,177 | 1,206 | 2,694 | ||||||||
Net income attributable to common shareholders | $ | 30,345 | $ | 5,289 | $ | 25,981 | |||||
Weighted-average number of common shares outstanding | 39,764 | 34,652 | 29,600 | ||||||||
Basic and diluted earnings per common share: | |||||||||||
Income from continuing operations | $ | 0.73 | $ | 0.12 | $ | 0.79 | |||||
Income from discontinued operations, net of tax | 0.03 | 0.03 | 0.09 | ||||||||
Net income per common share attributable to common shareholders | |||||||||||
$ | 0.76 | $ | 0.15 | $ | 0.88 | ||||||
Diluted earnings per common share attributable to common shareholders excludes 0.3 million shares at December 31, 2013, 2012 and 2011, respectively, of potential common shares related to our share-based compensation plan, because the inclusion of the potential common shares would have had an antidilutive effect. | |||||||||||
ACQUISITION_AND_DISPOSITIONS
ACQUISITION AND DISPOSITIONS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
ACQUISITION AND DISPOSITIONS | ' | ||||||||||
ACQUISITION AND DISPOSITIONS | ' | ||||||||||
3. ACQUISITION AND DISPOSITIONS | |||||||||||
Merger With SureWest Communications | |||||||||||
On July 2, 2012, we completed the merger with SureWest Communications (“SureWest”), which resulted in the acquisition of 100% of all the outstanding shares of SureWest for $23.00 per share in a cash and stock transaction. SureWest provides telecommunications services in Northern California, primarily in the greater Sacramento region, and in the greater Kansas City, Kansas and Missouri areas. The total purchase price of $550.8 million consisted of cash and assumed debt of $402.4 million and 9,965,983 shares of the Company’s common stock valued at the Company’s opening stock price on July 2, 2012 of $14.89, which totaled $148.4 million. We acquired SureWest to provide additional diversification of our revenues and cash flows. | |||||||||||
Subsequent to the merger, the financial results of SureWest operations have been included in our consolidated statements of income. SureWest contributed $133.1 million in net revenues and recorded net income of $2.5 million for the period of July 2, 2012 through December 31, 2012, which includes $9.5 million in acquisition related costs. | |||||||||||
The acquisition of SureWest has been accounted for using the acquisition method in accordance with the FASB’s ASC Topic 805, Business Combinations. Accordingly, the net assets acquired were recorded at their estimated fair values at July 2, 2012. These values were derived from a purchase price allocation, which was finalized during the quarter ended June 30, 2013. During the quarter ended June 30, 2013, the Company recorded tax related adjustments to the preliminary purchase price allocation which decreased deferred income taxes by $1.3 million, increased current assets by $0.2 million and decreased goodwill by $1.5 million. These final adjustments were retrospectively applied on the balance sheet to reflect the appropriate balances as of July 2, 2012. There was no impact to the income statement for the twelve months ended December 31, 2012. | |||||||||||
The following table summarizes the final purchase price allocation: | |||||||||||
(In thousands) | |||||||||||
Current assets | $ | 47,073 | |||||||||
Property, plant and equipment | 591,818 | ||||||||||
Goodwill | 84,016 | ||||||||||
Other intangible assets | 3,600 | ||||||||||
Other long-term assets | 4,861 | ||||||||||
Total assets acquired | 731,368 | ||||||||||
Current liabilities | 53,566 | ||||||||||
Pension and other post-retirement obligations | 55,916 | ||||||||||
Deferred income taxes | 66,976 | ||||||||||
Other long-term liabilities | 4,114 | ||||||||||
Total liabilities assumed | 180,572 | ||||||||||
Net assets acquired | $ | 550,796 | |||||||||
The acquired current assets included cash of $17.1 million and trade receivables with a fair value of approximately $21.6 million and a gross value of approximately $23.4 million. We believe that the estimated fair value of the trade receivables approximates the amount to be eventually collected. The acquired other intangible assets of approximately $3.6 million consisted of the estimated fair values assigned to customer lists of $2.7 million and tradenames of $0.9 million. The customer list intangible asset is being amortized over the estimated useful life of 3 or 5 years, depending on customer type. During the years ending December 31, 2013 and 2012, we recorded amortization expense of approximately $0.6 million and $0.3 million, respectively, relating to the customer lists. Goodwill of $84.0 million and the tradenames of $0.9 million are indefinite-lived assets which are not subject to amortization. During the year ending December 31, 2013, a formal one-year plan to transition from the SureWest tradename to the CONSOLIDATED tradename was adopted. We began to amortize the assigned value of the SureWest tradename over its estimated one-year useful life. We evaluate our goodwill for impairment annually as of November 30, as described in Note 1 above. Goodwill recognized from the acquisition primarily relates to the expected contributions of the entity to the overall corporate strategy in addition to synergies and acquired workforce, which are not separable from goodwill. Goodwill is not deductible for income tax purposes. | |||||||||||
Unaudited Pro Forma Results | |||||||||||
The following unaudited pro forma information presents our results of operations as if the acquisition of SureWest occurred on January 1, 2011. The adjustments to arrive at the pro forma information below included additional depreciation and amortization expense for the fair value increases to property plant and equipment, software and customer relationships. Interest expense was increased to reflect the additional debt entered into to finance a portion of the acquisition price. Shares used to calculate the basic and diluted earnings per share were adjusted to reflect the additional shares of common stock issued to fund a portion of the acquisition price. The pro forma information below does not purport to present the actual results that would have resulted if the acquisition had in fact occurred at the beginning of the fiscal periods presented, nor does the information project results for any future period. | |||||||||||
Year Ended | |||||||||||
December 31, | |||||||||||
(Unaudited; in thousands, except share amounts) | 2012 | ||||||||||
Operating revenues | $ | 605,779 | |||||||||
Income from operations | $ | 69,881 | |||||||||
Income from continuing operations | $ | 9,259 | |||||||||
Discontinued operations, net of tax | $ | 1,206 | |||||||||
Net income | $ | 10,465 | |||||||||
Less: income attributable to noncontrolling interest | 531 | ||||||||||
Net income attributable to common stockholders | $ | 9,934 | |||||||||
Net income per common share - basic and diluted | |||||||||||
Income from continuing operations | $ | 0.27 | |||||||||
Discontinued operations, net of tax | 0.03 | ||||||||||
Net income per basic and diluted common share attributable to common shareholders | $ | 0.3 | |||||||||
Discontinued Operations | |||||||||||
In September 2013, we completed the sale of the assets and contractual rights of our prison services business for a total cash purchase price of $2.5 million, which included the settlement of any pending legal matters. The financial results of the operations for prison services, which were previously reported in the Other Operations segment, have been reported as a discontinued operation in our consolidated financial statements for all periods presented. | |||||||||||
As of December 31, 2012, the major classes of the prison services assets and liabilities included in discontinued operations were as follows: | |||||||||||
(In thousands) | December 31, 2012 | ||||||||||
Accounts receivable, net | $ | 625 | |||||||||
Property, plant and equipment, net | 564 | ||||||||||
Total assets | $ | 1,189 | |||||||||
Accounts payable | $ | 13 | |||||||||
Advance billings and customer deposits | 938 | ||||||||||
Accrued expense | 3,258 | ||||||||||
Total liabilities | $ | 4,209 | |||||||||
The following table summarizes the financial information for the prison services operations: | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Operating revenues | $ | 5,622 | $ | 25,580 | $ | 25,260 | |||||
Operating expenses including depreciation and amortization | 5,883 | 23,599 | 21,534 | ||||||||
Income (loss) from operations | -261 | 1,981 | 3,726 | ||||||||
Other income (expense) | - | - | 672 | ||||||||
Income tax expense (benefit) | -105 | 775 | 1,704 | ||||||||
Income (loss) from discontinued operations | $ | -156 | $ | 1,206 | $ | 2,694 | |||||
Gain on sale of discontinued operations, net of tax of $887 | $ | 1,333 | $ | - | $ | - | |||||
INVESTMENTS
INVESTMENTS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
INVESTMENTS | ' | ||||||||||
INVESTMENTS | ' | ||||||||||
4. INVESTMENTS | |||||||||||
Our investments are as follows: | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Cash surrender value of life insurance policies | $ | 2,183 | $ | 2,045 | |||||||
Cost method investments: | |||||||||||
GTE Mobilnet of South Texas Limited Partnership (2.34% interest) | 21,450 | 21,450 | |||||||||
Pittsburgh SMSA Limited Partnership (3.60% interest) | 22,950 | 22,950 | |||||||||
CoBank, ACB Stock | 5,112 | 5,023 | |||||||||
Other | 200 | 430 | |||||||||
Equity method investments: | |||||||||||
GTE Mobilnet of Texas RSA #17 Limited Partnership (20.51% interest) | 27,467 | 25,695 | |||||||||
Pennsylvania RSA 6(I) Limited Partnership (16.6725% interest) | 7,696 | 7,286 | |||||||||
Pennsylvania RSA 6(II) Limited Partnership (23.67% interest) | 24,105 | 23,338 | |||||||||
CVIN, LLC (13.455% interest) | 1,936 | 1,533 | |||||||||
Totals | $ | 113,099 | $ | 109,750 | |||||||
Cost Method | |||||||||||
We own 2.34% of GTE Mobilnet of South Texas Limited Partnership (the “Mobilnet South Partnership”). The principal activity of the Mobilnet South Partnership is providing cellular service in the Houston, Galveston, and Beaumont, Texas metropolitan areas. We also own 3.60% of Pittsburgh SMSA Limited Partnership (“Pittsburgh SMSA”), which provides cellular service in and around the Pittsburgh metropolitan area. Because of our limited influence over these partnerships, we use the cost method to account for both of these investments. It is not practicable to estimate fair value of these investments. We did not evaluate any of the investments for impairment as no factors indicating impairment existed during the year. In 2013, 2012 and 2011, we received cash distributions from these partnerships totaling $16.9 million, $14.1 million and $11.1 million, respectively. | |||||||||||
CoBank, ACB (“CoBank”) is a cooperative bank owned by its customers. Annually, CoBank distributes patronage in the form of cash and stock in the cooperative based on the Company’s outstanding loan balance with CoBank, which has traditionally been a significant lender in the Company’s credit facility. The investment in CoBank represents the accumulation of the equity patronage paid by CoBank to the Company. | |||||||||||
Equity Method | |||||||||||
We own 20.51% of GTE Mobilnet of Texas RSA #17 Limited Partnership (“RSA #17”), 16.6725% of Pennsylvania RSA 6(I) Limited Partnership (“RSA 6(I)”) and 23.67% of Pennsylvania RSA 6(II) Limited Partnership (“RSA 6(II)”). RSA #17 provides cellular service to a limited rural area in Texas. In December 2012, we purchased additional ownership interest in RSA #17 for $6.7 million which increased our ownership from 17.02% to 20.51%. RSA 6(I) and RSA 6(II) provide cellular service in and around our Pennsylvania service territory. Because we have significant influence over the operating and financial policies of these three entities, we account for the investments using the equity method. In 2013, 2012 and 2011, we received cash distributions from these partnerships totaling $17.9 million, $15.0 million and $17.2 million, respectively. The carrying value of the investments exceeds the underlying equity in net assets of the partnerships by $33.2 million. | |||||||||||
We have a 13.455% interest in Central Valley Independent Network, LLC (“CVIN”), a joint enterprise comprised of affiliates of several independent telephone companies located in central and northern California. CVIN provides network services and oversees a broadband infrastructure project designed to expand and improve the availability of network services to counties in central California. In 2013, we made additional capital investments of $0.4 million in this partnership. We did not receive any distributions from this partnership in 2013 or 2012. | |||||||||||
The combined unaudited results of operations and financial position of our three equity investments in the cellular limited partnerships are summarized below: | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Total revenues | $ | 321,555 | $ | 299,389 | $ | 305,965 | |||||
Income from operations | 98,962 | 83,577 | 84,803 | ||||||||
Net income before taxes | 99,024 | 83,633 | 84,844 | ||||||||
Net income | 99,024 | 83,283 | 84,483 | ||||||||
Current assets | $ | 54,837 | $ | 49,982 | $ | 44,739 | |||||
Non-current assets | 87,968 | 79,529 | 79,432 | ||||||||
Current liabilities | 15,221 | 15,417 | 14,523 | ||||||||
Non-current liabilities | 1,786 | 1,351 | 1,096 | ||||||||
Partnership equity | 125,799 | 112,734 | 108,552 | ||||||||
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
5. FAIR VALUE MEASUREMENTS | ||||||||||||||
Financial Instruments | ||||||||||||||
Our derivative instruments related to interest rate swap agreements are required to be measured at fair value on a recurring basis. The fair values of the interest rate swaps are determined using valuation models and are categorized within Level 2 of the fair value hierarchy as the valuation inputs are based on quoted prices and observable market data of similar instruments. See Note 7 for further discussion regarding our interest rate swap agreements. | ||||||||||||||
Our interest rate swap liabilities measured at fair value on a recurring basis at December 31, 2013 and 2012 were as follows: | ||||||||||||||
As of December 31, 2013 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Current interest rate swap liabilities | $ | -660 | – | $ | -660 | – | ||||||||
Long-term interest rate swap liabilities | -1,959 | – | -1,959 | – | ||||||||||
Total | $ | -2,619 | $ | – | $ | -2,619 | $ | – | ||||||
As of December 31, 2012 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Current interest rate swap liabilities | $ | -3,164 | – | $ | -3,164 | – | ||||||||
Long-term interest rate swap liabilities | -3,919 | – | -3,919 | – | ||||||||||
Total | $ | -7,083 | $ | – | $ | -7,083 | $ | – | ||||||
The change in the fair value of the derivatives is primarily a result of a change in market expectations for future interest rates and the expiration of certain instruments during 2013. | ||||||||||||||
We have not elected the fair value option for any of our financial assets or liabilities. The carrying value of other financial instruments, including cash, accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short maturities or variable-rate nature of the respective balances. The following table presents the other financial instruments that are not carried at fair value but which require fair value disclosure as of December 31, 2013 and 2012. | ||||||||||||||
As of December 31, 2013 | As of December 31, 2012 | |||||||||||||
(In thousands) | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||
Investments, equity basis | $ | 61,204 | n/a | $ | 57,852 | n/a | ||||||||
Investments, at cost | $ | 49,712 | n/a | $ | 49,853 | n/a | ||||||||
Long-term debt, excluding capital leases | $ | 1,216,764 | $ | 1,261,508 | $ | 1,213,000 | $ | 1,231,355 | ||||||
Cost & Equity Method Investments | ||||||||||||||
Our investments at December 31, 2013 and 2012 accounted for under both the equity and cost methods consists primarily of minority positions in various cellular telephone limited partnerships and our investment in CoBank. These investments are recorded using either the equity or cost methods. It is impracticable to determine fair value of these investments. | ||||||||||||||
Long-term Debt | ||||||||||||||
The fair value of our long-term debt was estimated using a discounted cash flow analyses based on incremental borrowing rates for similar types of borrowing arrangements. We have categorized the long-term debt as Level 2 within the fair value hierarchy. | ||||||||||||||
LONGTERM_DEBT
LONG-TERM DEBT | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
LONG-TERM DEBT | ' | |||||||
LONG-TERM DEBT | ' | |||||||
6. LONG-TERM DEBT | ||||||||
Long-term debt outstanding, presented net of unamortized discounts, consisted of the following as of December 31, 2013 and 2012: | ||||||||
(In thousands) | 2013 | 2012 | ||||||
Senior secured credit facility: | ||||||||
Term loan 2 | $ | - | $ | 404,961 | ||||
Term loan 3, net of discount of $5,088 at December 31, 2012 | - | 509,912 | ||||||
Term loan 4, net of discount of $4,537 at December 31, 2013 | 905,463 | - | ||||||
Revolving loan | 13,000 | - | ||||||
Senior notes, net of discount of $1,699 and $1,873 at | ||||||||
December 31, 2013 and 2012, respectively | 298,301 | 298,127 | ||||||
Capital leases | 5,121 | 4,844 | ||||||
1,221,885 | 1,217,844 | |||||||
Less: current portion of long-term debt and capital leases | -9,751 | -9,596 | ||||||
Total long-term debt | $ | 1,212,134 | $ | 1,208,248 | ||||
Credit Agreement | ||||||||
The Company, through certain of its wholly owned subsidiaries, has an outstanding credit agreement with several financial institutions. In December 2013, we entered into a Second Amended and Restated Credit Agreement to restate the Company’s previously amended credit agreement. The restated credit agreement consists of a $75.0 million revolving credit facility and initial term loans in the aggregate amount of $910.0 million (“Term 4”). The proceeds from the restated credit agreement were used to repay the outstanding term loans from the previous agreement in its entirety. The credit agreement also includes an incremental term loan facility which provides the ability to borrow up to $300.0 million of incremental term loans subject to certain terms and conditions. Borrowings under the senior secured credit facility are secured by substantially all of the assets of the Company and its subsidiaries, with the exception of Illinois Consolidated Telephone Company and our majority-owned subsidiary, East Texas Fiber Line Incorporated. | ||||||||
The Term 4 loan facility consists of an original aggregate principal amount of $910.0 million with a maturity date of December 23, 2020, but is subject to earlier maturity on December 31, 2019 if the Company’s unsecured Senior Notes due in 2020 (“Senior Notes”) are repaid or redeemed in full by December 31, 2019. The Term 4 loan contains an original issuance discount of $4.6 million, which is being amortized over the term of the loan. The Term 4 loan requires quarterly principal payments of $2.3 million commencing March 31, 2014 and has an interest rate of LIBOR plus 3.25% subject to a 1.00% LIBOR floor. | ||||||||
Our revolving credit facility has a maturity date of December 23, 2018 and an applicable margin (at our election) of between 2.50% and 3.25% for LIBOR-based borrowings or between 1.50% and 2.25% for alternate base rate borrowings, depending on our leverage ratio. Based on our leverage ratio at December 31, 2013, the borrowing margin for the next three month period ending March 31, 2014 will be at a weighted-average margin of 3.00% for a LIBOR-based loan or 2.00% for an alternative base rate loan. The applicable borrowing margin for the revolving credit facility is adjusted quarterly to reflect the leverage ratio from the prior quarter-end. As of December 31, 2013, $13.0 million was outstanding under the revolving credit facility. There were no borrowings or letters of credit outstanding under the revolving credit facility at December 31, 2012. | ||||||||
The weighted-average interest rate on outstanding borrowings under our credit facility was 4.23% and 4.79% at December 31, 2013 and 2012, respectively. Interest is payable at least quarterly. | ||||||||
Net proceeds from asset sales exceeding certain thresholds, to the extent not reinvested, are required to be used to repay loans outstanding under the credit agreement. | ||||||||
Financing Costs | ||||||||
In connection with entering into the restated credit agreement in December 2013, fees of $6.6 million were capitalized as deferred debt issuance costs. These capitalized costs are amortized over the term of the debt and are included as a component of interest expense in the consolidated statements of income. We also incurred a loss on the extinguishment of debt of $7.7 million during the year ended December 31, 2013 related to the repayment of outstanding term loans under the previous credit agreement which were scheduled to mature in December 2017 and 2018. | ||||||||
The credit agreement was previously amended in December 2012, to issue incremental term loans (Term 3) which were used to repay outstanding term loans scheduled to mature in December 2014, to extend the maturity dates of outstanding term loans (Term 2) from December 2014 to December 2017 and to extend the termination date of the revolving loan facility. In connection with entering into the December 2012 amendment, fees of $4.2 million were capitalized as deferred debt issuance costs and we recognized a loss on the extinguishment of debt of $4.5 million during the year ended December 31, 2012. | ||||||||
In February 2012, the terms of our credit facility were amended to provide us with the ability to incur indebtedness necessary to finance the acquisition of SureWest, which enabled us to issue the Senior Notes, as described below. In connection with the amendment, fees of $3.5 million were recognized as financing and other transaction costs during the year ended December 31, 2012. | ||||||||
Credit Agreement Covenant Compliance | ||||||||
The credit agreement contains various provisions and covenants, including, among other items, restrictions on the ability to pay dividends, incur additional indebtedness, and issue capital stock. We have agreed to maintain certain financial ratios, including interest coverage and total net leverage ratios, all as defined in the credit agreement. As of December 31, 2013, we were in compliance with the credit agreement covenants. | ||||||||
In general, our credit agreement restricts our ability to pay dividends to the amount of our Available Cash as defined in our credit agreement. As of December 31, 2013, and including the $15.5 million dividend declared in November 2013 and paid on February 1, 2014, we had $202.4 million in dividend availability under the credit facility covenant. | ||||||||
Under our credit agreement, if our total net leverage ratio (as defined in the credit agreement), as of the end of any fiscal quarter, is greater than 5.10:1.00, we will be required to suspend dividends on our common stock unless otherwise permitted by an exception for dividends that may be paid from the portion of proceeds of any sale of equity not used to fund acquisitions, or make other investments. During any dividend suspension period, we will be required to repay debt in an amount equal to 50.0% of any increase in Available Cash, among other things. In addition, we will not be permitted to pay dividends if an event of default under the credit agreement has occurred and is continuing. Among other things, it will be an event of default if our total net leverage ratio and interest coverage ratio as of the end of any fiscal quarter is greater than 5.25:1.00 and less than 2.25:1.00, respectively. As of December 31, 2013, our total net leverage ratio under the credit agreement was 4.26:1.00, and our interest coverage ratio was 3.41:1.00. | ||||||||
Senior Notes | ||||||||
On May 30, 2012, we completed an offering of $300.0 million aggregate principal amount of 10.875% unsecured Senior Notes, due 2020 through our wholly-owned subsidiary, Consolidated Communications Finance Co. (“Finance Co.”) for the acquisition of SureWest. The Senior Notes will mature on June 1, 2020 and earn interest at a rate of 10.875% per year, payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2012. The Senior Notes were sold in the United States to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933 (the “Securities Act”) and outside the United States in compliance with Regulation S under the Securities Act. In addition, some of the Senior Notes were sold to certain “accredited investors” (as defined in Rule 501 under the Securities Act). The Senior Notes were sold to investors at a price equal to 99.345% of the principal amount thereof, for a yield to maturity of 11.00%. This discount is being amortized over the term of the Senior Notes. The proceeds of the sale of the Senior Notes were held in an escrow account prior to the closing of the SureWest transaction. Upon closing of the SureWest acquisition on July 2, 2012, Finance Co. merged with and into our wholly-owned subsidiary Consolidated Communications, Inc., which assumed the Senior Notes, and we and certain of our subsidiaries fully and unconditionally guaranteed the Senior Notes. On August 3, 2012, SureWest and its subsidiaries guaranteed the Senior Notes. | ||||||||
In 2013, we completed an exchange offer to issue registered notes (“Exchange Notes”) for $287.3 million of the original Senior Notes. The terms of the Exchange Notes are substantially identical to the Senior Notes, except that the Exchange Notes are registered under the Securities Act and the transfer restrictions and registration rights applicable to the Senior Notes do not apply to the Exchange Notes. The exchange offer did not impact the aggregate principal amount or the remaining terms of the Senior Notes outstanding. | ||||||||
Senior Notes Covenant Compliance | ||||||||
The indenture governing the Senior Notes contains customary covenants for high yield notes, which limits Consolidated Communications, Inc.’s and its restricted subsidiaries’ ability to: incur debt or issue certain preferred stock; pay dividends or make other distributions on capital stock or prepay subordinated indebtedness; purchase or redeem any equity interests; make investments; create liens; sell assets; enter into agreements that restrict dividends or other payments by restricted subsidiaries; consolidate, merge or transfer all or substantially all of its assets; engage in transactions with its affiliates; or enter into any sale and leaseback transactions. | ||||||||
Among other matters, the Senior Notes indenture provides that Consolidated Communications, Inc. may not pay dividends or make other “restricted payments” to the Company if its total net leverage ratio is 4.25:1.00 or greater. This ratio is calculated differently than the comparable ratio under the credit agreement; among other differences, it takes into account on a pro forma basis synergies expected to be achieved as a result of the SureWest acquisition but not yet reflected in historical results. At December 31, 2013, this ratio was 4.20:1.00. If this ratio is met, dividends and other restricted payments may be made from cumulative consolidated cash flow since the date the Senior Notes were issued, less 1.75 times fixed charges, less dividends and other restricted payments made since the date the Senior Notes were issued. Dividends may be paid and other restricted payments may also be made from a “basket” of $50.0 million, none of which has been used to date, and pursuant to other exceptions identified in the Senior Notes indenture. Since dividends of $108.5 million have been paid since May 30, 2012, at December 31, 2013 there was $156.6 million of the $265.1 million of cumulative consolidated cash flow since May 30, 2012 available to pay dividends. | ||||||||
Bridge Loan Facility | ||||||||
In connection with the acquisition of SureWest, in February 2012 the Company received committed financing for a total of $350.0 million to fund the cash portion of the anticipated transaction, to refinance SureWest’s debt and to pay for certain transaction costs. The financing package included a $350.0 million Senior Unsecured Bridge Loan Facility (“Bridge Facility”). As anticipated, permanent financing for the SureWest acquisition was funded by our Senior Note offering, as described above. As a result, the $4.2 million commitment fee incurred for the Bridge Facility was capitalized as deferred debt issuance costs in February 2012 and was amortized over the expected life of the Bridge Facility, which was four months. | ||||||||
Future Maturities of Debt | ||||||||
At December 31, 2013, the aggregate maturities of our long-term debt excluding capital leases were as follows: | ||||||||
(In thousands) | ||||||||
2014 | $ | 9,100 | ||||||
2015 | 9,100 | |||||||
2016 | 9,100 | |||||||
2017 | 9,100 | |||||||
2018 | 22,100 | |||||||
Thereafter | 1,164,500 | |||||||
Total maturities | 1,223,000 | |||||||
Less: Unamortized discount | -6,236 | |||||||
$ | 1,216,764 | |||||||
As of December 31, 2013, we had seven capital leases with maturities ranging from 2015 to 2021. See Note 11 regarding the future maturities of our obligations for capital leases. | ||||||||
DERIVATIVE_FINANCIAL_INSTRUMEN
DERIVATIVE FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||
7. DERIVATIVE FINANCIAL INSTRUMENTS | |||||||||||
The following interest rate swaps were outstanding at December 31, 2013: | |||||||||||
(In thousands) | Notional | 2013 Balance Sheet Location | Fair Value | ||||||||
Amount | |||||||||||
De-designated Hedges: | |||||||||||
Fixed to 1-month floating LIBOR | $ | 175,000 | Other long-term liabilities | $ | -1,897 | ||||||
Fixed to 1-month floating LIBOR | 100,000 | Current portion of derivative liability | -660 | ||||||||
Fixed to 1-month floating LIBOR (with floor) | 50,000 | Other long-term liabilities | -62 | ||||||||
Total Fair Values | $ | -2,619 | |||||||||
The following interest rate swaps were outstanding at December 31, 2012: | |||||||||||
(In thousands) | Notional | 2012 Balance Sheet Location | Fair Value | ||||||||
Amount | |||||||||||
Cash Flow Hedges: | |||||||||||
Fixed to 1-month floating LIBOR | $ | 200,000 | Other long-term liabilities | $ | -2,758 | ||||||
Fixed to 1-month floating LIBOR | 100,000 | Current portion of derivative liability | -1,069 | ||||||||
Forward starting fixed to 1-month floating LIBOR | 75,000 | Other long-term liabilities | -1,161 | ||||||||
De-designated Hedges: | |||||||||||
Fixed to 3-month floating LIBOR | 130,000 | Current portion of derivative liability | -1,300 | ||||||||
3-month floating LIBOR minus spread to 1-month floating LIBOR | 130,000 | Current portion of derivative liability | -16 | ||||||||
Fixed to 1-month floating LIBOR | 200,000 | Current portion of derivative liability | -779 | ||||||||
Total Fair Values | $ | -7,083 | |||||||||
As of December 31, 2013, the counterparties to our various swaps are four major U.S. and European banks. None of the swap agreements provide for either us or the counterparties to post collateral nor do the agreements include any covenants related to the financial condition of Consolidated or the counterparties. The swaps of any counterparty that is a “Lender” as defined in our credit facility are secured along with the other creditors under the credit facility. Each of the swap agreements provides that in the event of a bankruptcy filing by either Consolidated or the counterparty, any amounts owed between the two parties would be offset in order to determine the net amount due between parties. This provision allows us to partially mitigate the risk of non-performance by a counterparty. | |||||||||||
In December 2013, $325.0 million notional interest rate swaps previously designated as cash flow hedges were de-designated as a result of the amendment to our credit agreement on December 23, 2013 as discussed in Note 6. The interest rate swap agreements mature on various dates through September 2016. In December 2012, interest rate swaps with an aggregate notional value of $660.0 million were de-designated as cash flow hedges in connection with the amendment to our credit agreement on December 4, 2012. Of these agreements, $200.0 million notional interest rate swap agreements expired on December 31, 2012 and the remainder expired on March 31, 2013. Prior to de-designation, the effective portion of the change in fair value of the interest rate swaps were recognized in AOCI. The balance of the unrealized loss included in AOCI as of the date the swaps were de-designated is amortized to earnings over the remaining term of the swap agreements. Changes in fair value of the de-designated swaps are immediately recognized in earnings as interest expense. During the years ended December 31, 2013 and 2012, a gain of $2.2 million and $2.8 million, respectively, was recognized as a reduction to interest expense for the change in fair value of the de-designated swaps. | |||||||||||
At December 31, 2013 and 2012, the pre-tax deferred losses related to our interest rate swap agreements included in AOCI was $2.6 million and $7.9 million, respectively. The estimated amount of losses included in AOCI as of December 31, 2013 that will be recognized in earnings in the next twelve months is approximately $2.0 million. | |||||||||||
The following table presents the effect of interest rate derivatives designated as cash flow hedges on AOCI and on the consolidated statements of income for the years ended December 31, 2013, 2012 and 2011: | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Loss recognized in AOCI, pretax | $ | -614 | $ | -5,631 | $ | -7,617 | |||||
Loss reclassified from AOCI to interest expense | $ | -5,875 | $ | -13,664 | $ | -19,649 | |||||
Gain arising from ineffectiveness reducing interest expense | $ | - | $ | 47 | $ | 93 | |||||
EQUITY
EQUITY | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
EQUITY | ' | ||||||||||||||||
EQUITY | ' | ||||||||||||||||
8. EQUITY | |||||||||||||||||
Share-Based Compensation | |||||||||||||||||
Our Board of Directors may grant share-based awards from our shareholder approved Amended and Restated Consolidated Communications Holdings, Inc. 2005 Long-term Incentive Plan (the “Plan”). The Plan permits the issuance of awards in the form of stock options, stock appreciation rights, stock grants, stock unit grants and other equity-based awards to eligible directors and employees at the discretion of the Compensation Committee of the Board of Directors. Under the Plan, approximately 1,650,000 shares of our common stock are authorized for issuance, provided that no more than 300,000 shares may be granted in the form of stock options or stock appreciation rights to any eligible employee or director in any calendar year. Unless terminated sooner, the Plan will continue in effect until May 5, 2019. | |||||||||||||||||
We measure the fair value of time-based RSAs based on the market price of the underlying common stock as of the date of the grant. RSAs are amortized over their respective vesting periods, generally from immediate vest up to a four year vesting period using the straight line method. | |||||||||||||||||
We implemented an ongoing performance-based incentive program under the Plan. The performance-based incentive program provides for annual grants of PSAs. PSAs are restricted stock that is issued, to the extent earned, at the end of each performance cycle. Under the performance-based incentive program, each participant is given a target award expressed as a number of shares, with a payout opportunity ranging from 0% to 120% of the target, depending on performance relative to predetermined goals. In accordance with the applicable accounting guidance, an accounting estimate of the number of these shares that are expected to vest is made, and these shares are then expensed utilizing the grant-date fair value of the shares from the grant date through the end of the vesting period. | |||||||||||||||||
The following table summarizes the grants of RSAs and PSAs under the Plan during the years ended December 31, 2013, 2012 and 2011: | |||||||||||||||||
Years Ended December 31, | |||||||||||||||||
Grant Date | Grant Date | Grant Date | |||||||||||||||
2013 | Fair Value | 2012 | Fair Value | 2011 | Fair Value | ||||||||||||
RSAs Granted | 168,516 | $ | 17.13 | 14,732 | $ | 19.3 | 127,377 | $ | 17.92 | ||||||||
PSAs Granted | 66,504 | $ | 17.13 | 68,540 | $ | 19.3 | 50,440 | $ | 17.92 | ||||||||
Total | 235,020 | 83,272 | 177,817 | ||||||||||||||
The total fair value of the RSAs and PSAs that vested during the years ended December 31, 2013, 2012 and 2011 was $3.0 million, $2.4 million and $1.6 million, respectively. | |||||||||||||||||
The following table summarizes the RSA and PSA activity during the year ended December 31, 2013: | |||||||||||||||||
RSAs | PSAs | ||||||||||||||||
Shares | Weighted | Shares | Weighted | ||||||||||||||
Average Grant | Average Grant | ||||||||||||||||
Date Fair Value | Date Fair Value | ||||||||||||||||
Non-vested shares outstanding - January 1, 2013 | 64,318 | $ | 18.33 | 58,221 | $ | 18.85 | |||||||||||
Shares granted | 168,516 | $ | 17.13 | 66,504 | $ | 17.13 | |||||||||||
Shares vested | -107,833 | $ | 17.61 | -60,459 | $ | 17.9 | |||||||||||
Shares forfeited, cancelled or retired | -1,500 | $ | 17.13 | – | $ | - | |||||||||||
Non-vested shares outstanding - December 31, 2013 | 123,501 | $ | 17.32 | 64,266 | $ | 17.96 | |||||||||||
Share-Based Compensation Expense | |||||||||||||||||
The following table summarizes total compensation costs recognized for share-based payments during the years ended December 31, 2013, 2012 and 2011: | |||||||||||||||||
Year Ended December 31, | |||||||||||||||||
(In millions) | 2013 | 2012 | 2011 | ||||||||||||||
Restricted stock | $ | 1.8 | $ | 1.3 | $ | 1.3 | |||||||||||
Performance shares | 1.2 | 1 | 0.8 | ||||||||||||||
Total | $ | 3 | $ | 2.3 | $ | 2.1 | |||||||||||
Income tax benefits related to stock-based compensation of approximately $1.1 million, $0.4 million and $0.8 million was recorded for the years ended December 31, 2013, 2012 and 2011, respectively. Stock-based compensation expense is included in “selling, general and administrative expenses” in the accompanying statements of operations. | |||||||||||||||||
As of December 31, 2013, total unrecognized compensation costs related to nonvested RSAs and PSAs was $3.5 million and will be recognized over a weighted-average period of approximately 0.8 years. | |||||||||||||||||
Accumulated Other Comprehensive Loss | |||||||||||||||||
The following table summarizes the changes in accumulated other comprehensive loss, net of tax, by component during 2013: | |||||||||||||||||
Pension and | |||||||||||||||||
Post-Retirement | Derivative | ||||||||||||||||
(In thousands) | Obligations | Instruments | Total | ||||||||||||||
Balance at December 31, 2012 | $ | -40,581 | $ | -5,203 | $ | -45,784 | |||||||||||
Other comprehensive income before reclassifications | 39,381 | -381 | 39,000 | ||||||||||||||
Amounts reclassified from accumulated other comprehensive income | 1,843 | 3,941 | 5,784 | ||||||||||||||
Net current period other comprehensive income | 41,224 | 3,560 | 44,784 | ||||||||||||||
Balance at December 31, 2013 | $ | 643 | $ | -1,643 | $ | -1,000 | |||||||||||
The following table summarizes reclassifications from accumulated other comprehensive loss during 2013: | |||||||||||||||||
Amount | |||||||||||||||||
Reclassified from | |||||||||||||||||
AOCI | |||||||||||||||||
Year Ended | Affected Line Item in the | ||||||||||||||||
(In thousands) | December 31, 2013 | Statement of Income | |||||||||||||||
Amortization of pension and post-retirement items: | |||||||||||||||||
Prior service credit | $ | -637 | (a) | ||||||||||||||
Actuarial loss | 3,652 | (a) | |||||||||||||||
3,015 | Total before tax | ||||||||||||||||
-1,172 | Tax benefit | ||||||||||||||||
$ | 1,843 | Net of tax | |||||||||||||||
Loss on cash flow hedges: | |||||||||||||||||
Interest rate derivatives | $ | 5,875 | Interest expense | ||||||||||||||
-1,934 | Tax benefit | ||||||||||||||||
$ | 3,941 | Net of tax | |||||||||||||||
(a) These items are included in the components of net periodic benefit cost for our pension and post-retirement benefit plans. See Note 9 for additional details. |
PENSION_PLANS_AND_OTHER_POSTRE
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS | ' | |||||||||||||
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS | ' | |||||||||||||
9. PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS | ||||||||||||||
Defined Benefit Plans | ||||||||||||||
We sponsor a qualified defined benefit pension plan (“Retirement Plan”) that is non-contributory covering certain of our hourly employees who fulfill minimum age and service requirements. Certain salaried employees are also covered by the Retirement Plan, although these benefits have previously been frozen. In April 2013, the Retirement Plan was amended for certain employees under collective bargaining agreements to among other things: (i) change the benefit formula to a cash balance account as of May 1, 2013 and (ii) freeze entrance into the Retirement Plan so that no person is eligible to become a participant on or following May 1, 2013. As of May 2013, all employees under collective bargaining agreements that include a defined benefit plan are on a cash balance plan. | ||||||||||||||
In connection with the acquisition of SureWest, we assumed sponsorship in 2012 of a frozen non-contributory defined benefit pension plan (the “SureWest Plan”). The SureWest Plan covers certain eligible employees and benefits are based on years of service and the employee’s average compensation during the five highest consecutive years of the last ten years of credited service. This plan has previously been frozen so that no person is eligible to become a new participant and all future benefit accruals for existing participants have ceased. | ||||||||||||||
We also have two non-qualified supplemental retirement plans (“Supplemental Plans”): the Restoration Plan, which we acquired as part of our North Pittsburgh Systems, Inc. (“North Pittsburgh”) and TXU Communications Venture Company (“TXUCV”) acquisitions, and a Supplemental Executive Retirement Plan (“SERP”), which we acquired as part of our acquisition of SureWest. The Supplemental Plans provide supplemental retirement benefits to certain former employees by providing for incremental pension payments to partially offset the reduction that would have been payable under the qualified defined benefit pension plans if it were not for limitations imposed by federal income tax regulations. Both plans have previously been frozen so that no person is eligible to become a new participant in the Supplemental Plans. These plans are unfunded and have no assets. The benefits paid under the Supplemental Plans are paid from the general operating funds of the Company. | ||||||||||||||
The following tables summarize the change in benefit obligation, plan assets and funded status of the Retirement Plan, SureWest Plan and Supplemental Plans (collectively the “Pension Plans”) as of December 31, 2013 and 2012. | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in benefit obligation | ||||||||||||||
Benefit obligation at the beginning of the year | $ | 379,528 | $ | 203,413 | ||||||||||
Service cost | 743 | 1,184 | ||||||||||||
Interest cost | 15,307 | 13,620 | ||||||||||||
Actuarial loss (gain) | (34,315 | ) | 32,274 | |||||||||||
Benefits paid | (21,559 | ) | (16,529 | ) | ||||||||||
Acquisition of SureWest Plans | - | 146,688 | ||||||||||||
Plan change | (2,361 | ) | (1,122 | ) | ||||||||||
Benefit obligation at the end of the year | $ | 337,343 | $ | 379,528 | ||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in plan assets | ||||||||||||||
Fair value of plan assets at the beginning of the year | $ | 262,778 | $ | 142,736 | ||||||||||
Employer contributions | 11,480 | 15,222 | ||||||||||||
Actual return on plan assets | 39,489 | 27,935 | ||||||||||||
Benefits paid | (21,559 | ) | (16,529 | ) | ||||||||||
Acquisition of SureWest Plans | - | 93,414 | ||||||||||||
Fair value of plan assets at the end of the year | $ | 292,188 | $ | 262,778 | ||||||||||
Funded status at year end | $ | (45,155 | ) | $ | (116,750 | ) | ||||||||
Amounts recognized in the consolidated balance sheets at December 31, 2013 and 2012 consisted of: | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Current liabilities | $ | (254 | ) | $ | (254 | ) | ||||||||
Long-term liabilities | $ | (44,901 | ) | $ | (116,496 | ) | ||||||||
Amounts recognized in accumulated other comprehensive loss for the years ended December 31, 2013 and 2012 consisted of: | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Unamortized prior service credit | $ | (4,426 | ) | $ | (2,523 | ) | ||||||||
Unamortized net actuarial loss | 10,302 | 67,104 | ||||||||||||
$ | 5,876 | $ | 64,581 | |||||||||||
The following table summarizes the components of net periodic pension cost recognized in the consolidated statements of income for the plans for the years ended December 31, 2013, 2012 and 2011: | ||||||||||||||
(In thousands) | 2013 | 2012 | 2011 | |||||||||||
Service cost | $ | 743 | $ | 1,184 | $ | 1,277 | ||||||||
Interest cost | 15,307 | 13,620 | 10,960 | |||||||||||
Expected return on plan assets | (20,654 | ) | (14,728 | ) | (10,893 | ) | ||||||||
Amortization of: | ||||||||||||||
Net actuarial loss | 3,652 | 2,518 | 786 | |||||||||||
Prior service credit | (457 | ) | (282 | ) | (166 | ) | ||||||||
Net periodic pension cost | $ | (1,409 | ) | $ | 2,312 | $ | 1,964 | |||||||
The following table summarizes other changes in plan assets and benefit obligations recognized in other comprehensive loss, before tax effects, during 2013 and 2012. | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Actuarial loss (gain), net | $ | (53,149 | ) | $ | 19,066 | |||||||||
Recognized actuarial loss | (3,652 | ) | (2,518 | ) | ||||||||||
Prior service credit | (2,361 | ) | (1,122 | ) | ||||||||||
Recognized prior service credit | 457 | 282 | ||||||||||||
Total amount recognized in other comprehensive loss, before tax effects | $ | (58,705 | ) | $ | 15,708 | |||||||||
The estimated net loss and net prior service credit for the defined benefit pension plans that will be amortized from accumulated other comprehensive loss in net periodic benefit cost in 2014 are $0.2 million and $(0.5) million, respectively. | ||||||||||||||
The weighted-average assumptions used to determine the projected benefit obligations and net periodic benefit cost for the years ended December 31, 2013, 2012 and 2011 were as follows: | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Discount rate - net periodic benefit cost | 4.20% | 5.00% | 5.86% | |||||||||||
Discount rate - benefit obligation | 4.97% | 4.20% | 5.35% | |||||||||||
Expected long-term rate of return on plan assets | 8.00% | 7.70% | 7.50% | |||||||||||
Rate of compensation/salary increase | 1.75% | 1.50% | 3.06% | |||||||||||
Other Non-qualified Deferred Compensation Agreements | ||||||||||||||
We also are liable for deferred compensation agreements with former members of the board of directors and certain other former employees of a subsidiary of TXUCV, which was acquired in 2004. The benefits are payable for up to the life of the participant or to the beneficiary upon the death of the participant and may begin as early as age 55. Participants accrue no new benefits as these plans had previously been frozen by TXUCV’s predecessor company prior to our acquisition of TXUCV. Payments related to the deferred compensation agreements totaled approximately $0.6 million for the years ended December 31, 2013 and 2012, respectively. The net present value of the remaining obligations was approximately $1.8 million and $2.2 million at December 31, 2013 and 2012, respectively, and is included in pension and post-retirement benefit obligations in the accompanying balance sheets. | ||||||||||||||
We also maintain 34 life insurance policies on certain of the participating former directors and employees. We recognized $0.3 million and $0.4 million in life insurance proceeds as other non-operating income in 2013 and 2012. The excess of the cash surrender value of the remaining life insurance policies over the notes payable balances related to these policies is determined by an independent consultant, and totaled $2.2 million and $2.0 million at December 31, 2013 and 2012, respectively. These amounts are included in investments in the accompanying consolidated balance sheets. Cash principal payments for the policies and any proceeds from the policies are classified as operating activities in the consolidated statements of cash flows. The aggregate death benefit payment payable under these policies totaled $7.3 million and $7.5 million as of December 31, 2013 and 2012, respectively. | ||||||||||||||
Post-retirement Benefit Obligations | ||||||||||||||
We sponsor a healthcare and life insurance plan (“Post-retirement Plan”) that provides post-retirement medical benefits and life insurance to certain groups of retired employees. Retirees share in the cost of healthcare benefits, making contributions that are adjusted periodically—either based upon collective bargaining agreements or because total costs of the program have changed. Covered expenses for retiree health benefits are paid as they are incurred. Post-retirement life insurance benefits are fully insured. The Post-retirement Plan is unfunded and has no assets, and benefits are paid from the general operating funds of the Company. | ||||||||||||||
In connection with the acquisition of SureWest, we acquired its post-retirement benefit plan which provides life insurance benefits and a stated reimbursement for Medicare supplemental insurance to certain eligible retired participants. This plan has previously been frozen so that no person is eligible to become a new participant. Employer contributions for retiree medical benefits are separately designated within the SureWest Plan pension trust for the sole purpose of providing payments of retiree medical benefits. The nature of the assets used to provide payment of retiree medical benefits is the same as that of the SureWest Plan. | ||||||||||||||
The following tables summarize the change in benefit obligation, plan assets and funded status of the post-retirement benefit obligations as of December 31, 2013 and 2012. | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in benefit obligation | ||||||||||||||
Benefit obligation at the beginning of the year | $ | 43,906 | $ | 33,184 | ||||||||||
Service cost | 925 | 811 | ||||||||||||
Interest cost | 1,575 | 1,756 | ||||||||||||
Plan participant contributions | 757 | 614 | ||||||||||||
Actuarial loss (gain) | (9,552 | ) | 5,282 | |||||||||||
Benefits paid | (3,966 | ) | (4,011 | ) | ||||||||||
Amendments | 1,448 | - | ||||||||||||
Acquisition | - | 6,270 | ||||||||||||
Benefit obligation at the end of the year | $ | 35,093 | $ | 43,906 | ||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in plan assets | ||||||||||||||
Fair value of plan assets at the beginning of the year | $ | 3,410 | $ | – | ||||||||||
Employer contributions | 2,772 | 3,189 | ||||||||||||
Plan participant’s contributions | 757 | 614 | ||||||||||||
Actual return on plan assets | 602 | 197 | ||||||||||||
Benefits paid | (3,966 | ) | (4,011 | ) | ||||||||||
Acquisition | – | 3,421 | ||||||||||||
Fair value of plan assets at the end of the year | $ | 3,575 | $ | 3,410 | ||||||||||
Funded status at year end | $ | (31,518 | ) | $ | (40,496 | ) | ||||||||
Amounts recognized in the consolidated balance sheets at December 31, 2013 and 2012 consist of: | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Current liabilities | $ | (2,429 | ) | $ | (2,467 | ) | ||||||||
Long-term liabilities | $ | (29,089 | ) | $ | (38,029 | ) | ||||||||
Amounts recognized in accumulated other comprehensive loss for the years ended December 31, 2013 and 2012 consist of: | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Unamortized prior service cost (credit) | $ | 183 | $ | (1,446 | ) | |||||||||
Unamortized net actuarial loss (gain) | (7,868 | ) | 2,055 | |||||||||||
$ | (7,685 | ) | $ | 609 | ||||||||||
The following table summarizes the components of the net periodic costs for post-retirement benefits for the years ended December 31, 2013, 2012 and 2011: | ||||||||||||||
(In thousands) | 2013 | 2012 | 2011 | |||||||||||
Service cost | $ | 925 | $ | 811 | $ | 749 | ||||||||
Interest cost | 1,575 | 1,756 | 1,690 | |||||||||||
Expected return on plan assets | (233 | ) | (105 | ) | – | |||||||||
Amortization of: | ||||||||||||||
Net actuarial loss (gain) | – | – | (212 | ) | ||||||||||
Prior service credit | (180 | ) | (189 | ) | (189 | ) | ||||||||
Net periodic postretirement benefit cost | $ | 2,087 | $ | 2,273 | $ | 2,038 | ||||||||
The following table summarizes other changes in plan assets and benefit obligations recognized in other comprehensive loss, before tax effects, during 2013 and 2012: | ||||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Actuarial loss (gain), net | $ | (9,922 | ) | $ | 5,191 | |||||||||
Prior service cost | 1,448 | – | ||||||||||||
Recognized prior service credit | 180 | 189 | ||||||||||||
Total amount recognized in other comprehensive loss, before tax effects | $ | (8,294 | ) | $ | 5,380 | |||||||||
The estimated net actuarial gain and net prior service credit that will be amortized from accumulated other comprehensive loss in net periodic postretirement cost in 2014 is approximately $(0.5) million and $(0.2) million, respectively. | ||||||||||||||
The weighted-average discount rate assumptions utilized for the years ended December 31 were as follows: | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net periodic benefit cost | 4.00% | 5.00% | 5.58% | |||||||||||
Benefit obligation | 4.40% | 3.90% | 5.22% | |||||||||||
For purposes of determining the cost and obligation for pre-Medicare postretirement medical benefits, a 7.50% annual rate of increase in the per capita cost of covered benefits (i.e., healthcare trend rate) was assumed for the plan in 2014, declining to a rate of 5.00% in 2020. Assumed healthcare cost trend rates have a significant effect on the amounts reported for healthcare plans. A one percent change in the assumed healthcare cost trend rate would have had the following effects: | ||||||||||||||
(In thousands) | 1% Increase | 1% Decrease | ||||||||||||
Effect on total of service and interest cost | $ | 277 | $ | (230 | ) | |||||||||
Effect on postretirement benefit obligation | $ | 2,063 | $ | (1,852 | ) | |||||||||
Plan Assets | ||||||||||||||
Our investment strategy is designed to provide a stable environment to earn a rate of return over time to satisfy the benefit obligations and minimize the reliance on contributions as a source of benefit security. The objectives are based on a long-term (5 to 15 year) investment horizon, so that interim fluctuations should be viewed with appropriate perspective. The assets of the fund are to be invested to achieve the greatest return for the pension plans consistent with a prudent level of risk. | ||||||||||||||
The asset return objective is to achieve, as a minimum over time, the passively managed return earned by managed index funds, weighted in the proportions outlined by the asset class exposures identified in the pension plan’s strategic allocation. We update our long-term, strategic asset allocations every few years to ensure they are in line with our fund objectives. The target allocation of the Pension Plan assets is approximately 50% - 60% equities with the remainder in fixed income funds and cash equivalents. Currently, we believe that there are no significant concentrations of risk associated with the pension plan assets. | ||||||||||||||
The following is a description of the valuation methodologies for assets measured at fair value utilizing the fair value hierarchy discussed in Note 1, which prioritizes the inputs used in the valuation methodologies in measuring fair value. The fair value measurements used to value our plan assets as of December 31, 2013 were generated by using market transactions involving identical or comparable assets. There were no changes in the valuation techniques used during 2013. | ||||||||||||||
Equity securities include investments in common and preferred stocks, mutual funds, common collective trusts and other commingled investment funds. | ||||||||||||||
Common and Preferred Stocks: Includes domestic and international common and preferred stocks and are valued at the closing price as of the measurement date as reported on the active market on which the individual securities are traded multiplied by the number of shares owned. | ||||||||||||||
Mutual Funds: Valued at the closing net asset value as of the measurement date as reported on the active market on which the funds are traded multiplied by the number of shares owned or the percentage of ownership in the fund. | ||||||||||||||
Common Collective Trusts and Commingled Funds: Valued as determined by the fund manager based on the underlying net asset values and supported by the value of the underlying securities as of the financial statement date. | ||||||||||||||
Fixed income funds include U.S. Treasury and Government Agency securities, corporate and municipal bonds, and mortgage-backed securities. | ||||||||||||||
U.S. Treasury and Government Agency Securities: Valued at the closing net asset value as of the measurement date as reported on the active market on which the funds are traded multiplied by the number of shares owned or the percentage of ownership in the fund. | ||||||||||||||
Corporate and municipal bonds and mortgage-backed securities: Valued based on yields currently available on comparable securities of issuers with similar credit ratings. | ||||||||||||||
The fair values of our assets for our defined benefit pension plans at December 31, 2013 and 2012, by asset category were as follows: | ||||||||||||||
As of December 31, 2013 | ||||||||||||||
Significant | Significant | |||||||||||||
Quoted Prices | Other | Unobservable | ||||||||||||
In Active | Observable | Inputs | ||||||||||||
Markets for | Inputs | |||||||||||||
Identical Assets | ||||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 4,708 | $ | 2,835 | $ | 1,873 | $ | – | ||||||
Equities: | ||||||||||||||
Stocks: | ||||||||||||||
U.S. common stocks | 38,463 | 38,463 | – | – | ||||||||||
International stocks | 10,198 | 10,198 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 15,181 | – | 15,181 | – | ||||||||||
U.S. mid cap | 9,215 | 9,215 | – | – | ||||||||||
U.S. large cap | 34,535 | 11,101 | 23,434 | – | ||||||||||
Emerging markets | 20,225 | 12,855 | 7,370 | – | ||||||||||
International | 60,416 | 44,132 | 16,284 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 19,012 | 19,012 | – | – | ||||||||||
Corporate and municipal bonds | 8,624 | – | 8,624 | – | ||||||||||
Mortgage/asset-backed securities | 8,116 | – | 8,116 | – | ||||||||||
Common Collective Trust | 17,398 | – | 17,398 | |||||||||||
Mutual funds | 46,097 | 46,097 | – | – | ||||||||||
Total | $ | 292,188 | $ | 193,908 | $ | 98,280 | $ | – | ||||||
As of December 31, 2012 | ||||||||||||||
Significant | Significant | |||||||||||||
Quoted Prices | Other | Unobservable | ||||||||||||
In Active | Observable | Inputs | ||||||||||||
Markets for | Inputs | |||||||||||||
Identical Assets | ||||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 4,262 | $ | 1,036 | $ | 3,226 | $ | – | ||||||
Equities: | ||||||||||||||
Stocks: | ||||||||||||||
U.S. common stocks | 36,620 | 36,620 | – | – | ||||||||||
International stocks | 9,589 | 9,589 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 17,110 | – | 17,110 | – | ||||||||||
U.S. mid cap | 7,477 | 7,477 | – | – | ||||||||||
U.S. large cap | 35,130 | 12,932 | 22,198 | – | ||||||||||
Emerging markets | 7,807 | 7,807 | – | – | ||||||||||
International | 43,100 | 34,602 | 8,498 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 22,937 | 22,937 | – | – | ||||||||||
Corporate and municipal bonds | 9,238 | – | 9,238 | – | ||||||||||
Mortgage/asset-backed securities | 10,669 | – | 10,669 | – | ||||||||||
Common Collective Trust | 7,346 | 7,346 | ||||||||||||
Mutual funds | 51,493 | 51,493 | – | – | ||||||||||
Total | $ | 262,778 | $ | 184,493 | $ | 78,285 | $ | – | ||||||
(1) Short-term investments includes cash and cash equivalents and an investment in a common collective trust which is principally comprised of certificates of deposit, commercial paper and U.S. Treasury bills with maturities less than one year. | ||||||||||||||
The fair values of our assets for our post-retirement benefit plans at December 31, 2013 and 2012 were as follows: | ||||||||||||||
As of December 31, 2013 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 89 | $ | 89 | $ | – | $ | – | ||||||
Equities: | ||||||||||||||
U.S. common stocks | 592 | 592 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 215 | – | 215 | – | ||||||||||
U.S. large cap | 638 | – | 638 | – | ||||||||||
Emerging markets | 263 | – | 263 | – | ||||||||||
International | 938 | 357 | 581 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 678 | 678 | – | – | ||||||||||
Corporate and municipal bonds | 308 | – | 308 | – | ||||||||||
Mortgage/asset-backed securities | 289 | – | 289 | – | ||||||||||
Total investments | $ | 4,010 | $ | 1,716 | $ | 2,294 | $ | – | ||||||
Benefit payments payable | -434 | |||||||||||||
Net plan assets | $ | 3,576 | ||||||||||||
As of December 31, 2012 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 30 | $ | 30 | $ | – | $ | – | ||||||
Equities: | ||||||||||||||
U.S. common stocks | 545 | 545 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 238 | – | 238 | – | ||||||||||
U.S. large cap | 572 | – | 572 | – | ||||||||||
International | 576 | 289 | 287 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 776 | 776 | – | – | ||||||||||
Corporate and municipal bonds | 312 | – | 312 | – | ||||||||||
Mortgage/asset-backed securities | 361 | – | 361 | – | ||||||||||
Total | $ | 3,410 | $ | 1,640 | $ | 1,770 | $ | – | ||||||
(1) Short-term investments includes cash and cash equivalents and an investment in a common collective trust which is principally comprised of certificates of deposit, commercial paper and U.S. Treasury bills with maturities less than one year. | ||||||||||||||
Cash Flows | ||||||||||||||
Contributions | ||||||||||||||
Our funding policy is to contribute annually an actuarially determined amount necessary to meet the minimum funding requirements as set forth in employee benefit and tax laws. We expect to contribute approximately $12.1 million to our pension plans and $2.5 million to our other post-retirement plans in 2014. | ||||||||||||||
Estimated Future Benefit Payments | ||||||||||||||
As of December 31, 2013, benefit payments expected to be paid over the next ten years are outlined in the following table: | ||||||||||||||
Other | ||||||||||||||
Pension | Post-retirement | |||||||||||||
(In thousands) | Plans | Plans | ||||||||||||
2014 | $ | 22,413 | $ | 3,495 | ||||||||||
2015 | 22,827 | 3,574 | ||||||||||||
2016 | 23,164 | 3,615 | ||||||||||||
2017 | 23,274 | 2,806 | ||||||||||||
2018 | 23,245 | 2,820 | ||||||||||||
2019 - 2023 | 116,421 | 12,867 | ||||||||||||
Defined Contribution Plans | ||||||||||||||
We offer defined contribution 401(k) plans to substantially all of our employees. Contributions made under the defined contribution plans include a match, at the Company’s discretion, of employee contributions to the plans. We recognized expense with respect to these plans of $5.2 million, $3.9 million and $2.5 million in 2013, 2012 and 2011, respectively. The increase in expense in 2013 and 2012 was attributable to the acquisition of SureWest in 2012. | ||||||||||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
INCOME TAXES | ' | ||||||||||
INCOME TAXES | ' | ||||||||||
10. INCOME TAXES | |||||||||||
Income tax expense consists of the following components: | |||||||||||
For the Year Ended | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Current: | |||||||||||
Federal | $ | 1,381 | $ | 340 | $ | 4,118 | |||||
State | 86 | 1,078 | 477 | ||||||||
Total current expense (benefit) | 1,467 | 1,418 | 4,595 | ||||||||
Deferred: | |||||||||||
Federal | 15,929 | 1,998 | 8,209 | ||||||||
State | 116 | -2,755 | 337 | ||||||||
Total deferred expense (benefit) | 16,045 | -757 | 8,546 | ||||||||
Total income tax expense | $ | 17,512 | $ | 661 | $ | 13,141 | |||||
The following is a reconciliation of the federal statutory tax rate to the effective tax rate for the years ended December 31, 2013, 2012 and 2011: | |||||||||||
Year Ended December 31, | |||||||||||
(In percentages) | 2013 | 2012 | 2011 | ||||||||
Statutory federal income tax rate | 35 | 35 | 35 | ||||||||
State income taxes, net of federal benefit | 1.7 | -12.8 | 0.5 | ||||||||
Transaction costs | – | 14.9 | – | ||||||||
Other permanent differences | – | -1.1 | -0.9 | ||||||||
Change in uncertain tax positions | -1.7 | – | -0.7 | ||||||||
Change in deferred tax rate | – | -19.7 | 1.1 | ||||||||
Provision to return | 1.3 | -4.2 | – | ||||||||
Other | 0.6 | -0.4 | 0.1 | ||||||||
36.9 | 11.7 | 35.1 | |||||||||
Deferred Taxes | |||||||||||
The components of the net deferred tax liability are as follows: | |||||||||||
Year Ended December 31, | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Current deferred tax assets: | |||||||||||
Reserve for uncollectible accounts | $ | 615 | $ | 1,815 | |||||||
Accrued vacation pay deducted when paid | 2,196 | 1,727 | |||||||||
Accrued expenses and deferred revenue | 5,149 | 5,458 | |||||||||
7,960 | 9,000 | ||||||||||
Non-current deferred tax assets: | |||||||||||
Net operating loss carryforwards | 18,809 | 32,506 | |||||||||
Pension and postretirement obligations | 28,072 | 60,252 | |||||||||
Stock-based compensation | 495 | 450 | |||||||||
Derivative instruments | 1,004 | 3,004 | |||||||||
Financing costs | 1,503 | 567 | |||||||||
Tax credit carryforwards | 3,143 | 2,437 | |||||||||
Other | - | 305 | |||||||||
53,026 | 99,521 | ||||||||||
Valuation allowance | -535 | -535 | |||||||||
Net non-current deferred tax assets | 52,491 | 98,986 | |||||||||
Non-current deferred tax liabilities: | |||||||||||
Goodwill and other intangibles | -28,515 | -27,376 | |||||||||
Basis in investment | -38 | -120 | |||||||||
Partnership investments | -25,523 | -26,413 | |||||||||
Property, plant and equipment | -178,274 | -182,578 | |||||||||
-232,350 | -236,487 | ||||||||||
Net non-current deferred taxes | -179,859 | -137,501 | |||||||||
Net deferred income tax liabilities | $ | -171,899 | $ | -128,501 | |||||||
Deferred income taxes are provided for the temporary differences between assets and liabilities recognized for financial reporting purposes and assets and liabilities recognized for tax purposes. The ultimate realization of deferred tax assets depends upon taxable income during the future periods in which those temporary differences become deductible. To determine whether deferred tax assets can be realized, management assesses whether it is more likely than not that some portion or all of the deferred tax assets will not be realized, taking into consideration the scheduled reversal of deferred tax liabilities, projected future taxable income and tax-planning strategies. | |||||||||||
Based upon historical taxable income, taxable temporary differences, available and prudent tax planning strategies and projections for future pre-tax book income over the periods that the deferred tax assets are deductible, management believes it is more likely than not that the Company will realize the benefits of these temporary differences. However, management may reduce the amount of deferred tax assets it considers realizable in the near term if estimates of future taxable income during the carryforward period are reduced. Estimates of future taxable income are based on the estimated recognition of taxable temporary differences, available and prudent tax planning strategies, and projections of future pre-tax book income. The amount of estimated future taxable income is expected to allow for the full utilization of the net operating loss (“NOL”) carryforwards, as described below. | |||||||||||
Consolidated and its wholly owned subsidiaries, which file a consolidated federal income tax return, estimates it has available federal NOL carryforwards at December 31, 2013, of $43.0 million and related deferred tax assets of $15.0 million. The federal NOL carryforwards expire from 2026 to 2032. Management believes that the future utilization of $1.5 million and related deferred tax asset of $0.5 million subject to Separate Return Limitation Year is uncertain and has placed a full valuation allowance on this amount of the available federal NOL carryforwards. The related NOL carryforward expires in 2026. The valuation allowance was recorded as a result of the acquisition of SureWest during 2012. If or when recognized, the tax benefits related to any reversal of the valuation allowance will be accounted for as a reduction of income tax expense. | |||||||||||
ETFL, a nonconsolidated subsidiary for federal income tax return purposes, estimates it has available NOL carryforwards at December 31, 2013, of $2.3 million and related deferred tax assets of $0.8 million. ETFL’s federal NOL carryforwards expire from 2020 to 2024. | |||||||||||
We estimate that we have available state NOL carryforwards at December 31, 2013, of $85.8 million and related deferred tax assets of $2.9 million. The state NOL carryforwards expire from 2016 to 2033. | |||||||||||
We estimate that we have available federal alternative minimum tax (“AMT”) credit carryforwards at December 31, 2013, of $0.5 million and related deferred tax assets of $0.5 million. The AMT credits are available to offset future tax liabilities only to the extent that the Company has regular tax liabilities in excess of AMT tax liabilities. The federal AMT credit carryforward does not expire. | |||||||||||
We estimate that we have available state tax credit carryforwards at December 31, 2013, of $4.1 million and related deferred tax assets of $2.7 million. The state tax credit carryforward are limited annually and expire from 2016 to 2027. | |||||||||||
On September 13, 2013, Treasury and the Internal Revenue Service issued final regulations regarding the deduction and capitalization of expenditures related to tangible property. The final regulations under Internal Revenue Code Sections 162, 167 and 263(a) apply to amounts paid to acquire, produce, or improve tangible property as well as dispositions of such property and are generally effective for tax years beginning on or after January 1, 2014. We have evaluated these regulations and we do not expect they will have a material impact on our consolidated results of operations, cash flows or financial position. | |||||||||||
Unrecognized Tax Benefits | |||||||||||
Under the accounting guidance applicable to uncertainty in income taxes we have analyzed filing positions in all of the federal and state jurisdictions where we are required to file income tax returns as well as all open tax years in these jurisdictions. This accounting guidance clarifies the accounting for uncertainty in income taxes recognized in a company’s financial statements; prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return; and provides guidance on description, classification, interest and penalties, accounting in interim periods, disclosure, and transition. | |||||||||||
Our unrecognized tax benefits as of December 31, 2013 and 2012 were $0 and $1.2 million, respectively. Due to the expiration of a state statute of limitations, during 2013 we recognized $1.2 million of our previously unrecognized tax benefits, which resulted in a decrease to our tax expense of approximately $0.8 million. The tax benefit attributable to the decrease in unrecognized tax benefits did not have a significant effect on our effective tax rate. | |||||||||||
Our practice is to recognize interest and penalties related to income tax matters in interest expense and general and administrative expense, respectively. During 2013 and 2012 we did not record any material interest or penalty expense and have no material remaining liability for interest or penalties. | |||||||||||
The periods subject to examination for our federal return are years 2010 through 2012. The periods subject to examination for our state returns are years 2005 through 2012. We are currently under examination by federal and state taxing authorities. We have received proposed assessments in connection with our federal examination for tax years ended December 31, 2010 and 2011. We are in the process of responding to the IRS and providing support for our tax position. We believe that our tax position will be upheld based on the technical merits of our position. Accordingly, the Company has not made any adjustments to its unrecognized tax benefits for the proposed assessments. We do not expect any settlement or payment that may result from the audits to have a material effect on our results of operations or cash flows. | |||||||||||
The following is a reconciliation of the unrecognized tax benefits for the years ended December 31, 2013 and 2012: | |||||||||||
Liability for | |||||||||||
Unrecognized | |||||||||||
Tax Benefits | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Balance at January 1 | $ | 1,224 | $ | 1,224 | |||||||
Additions for tax positions in the current year | – | – | |||||||||
Additions for tax positions of prior years | – | – | |||||||||
Settlements with taxing authorities | – | – | |||||||||
Reduction for lapse of federal statute of limitations | – | – | |||||||||
Reduction for lapse of state statute of limitations | -1,224 | – | |||||||||
Balance at December 31 | $ | - | $ | 1,224 | |||||||
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | ||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | ||||||||||||||||||||||
11. COMMITMENTS AND CONTINGENCIES | |||||||||||||||||||||||
We have certain other obligations for various contractual agreements to secure future rights to goods and services to be used in the normal course of our operations. These include purchase commitments for planned capital expenditures, agreements securing dedicated access and transport services, and service and support agreements. Additionally, we have procured transport resale arrangements with several interexchange carriers for our long distance services. | |||||||||||||||||||||||
As of December 31, 2013, future minimum contractual obligations, including capital and operating leases, and the estimated timing and effect the obligations will have on our liquidity and cash flows in future periods are as follows: | |||||||||||||||||||||||
Minimum Annual Contractual Obligations | |||||||||||||||||||||||
(in thousands) | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | ||||||||||||||||
Operating lease agreements | $ | 1,272 | $ | 1,249 | $ | 1,054 | $ | 961 | $ | 960 | $ | 2,362 | $ | 7,858 | |||||||||
Capital lease agreements | 2,133 | 1,712 | 563 | 392 | 287 | 793 | 5,880 | ||||||||||||||||
Capital expenditures (1) | 8,384 | – | – | – | – | – | 8,384 | ||||||||||||||||
Service and support agreements (2) | 7,221 | 5,796 | 4,873 | 890 | 233 | – | 19,013 | ||||||||||||||||
Transport and data connectivity | 9,100 | 9,000 | 9,000 | 9,000 | – | – | 36,100 | ||||||||||||||||
Total | $ | 28,110 | $ | 17,757 | $ | 15,490 | $ | 11,243 | $ | 1,480 | $ | 3,155 | $ | 77,235 | |||||||||
(1) We have binding commitments with numerous suppliers for future capital expenditures. | |||||||||||||||||||||||
(2) We have entered into service and maintenance agreements to support various computer hardware and software applications and certain equipment. If we terminate any of the contracts prior to their expiration date, we would be liable for minimum commitment payments as defined in by the contractual terms of the contracts. | |||||||||||||||||||||||
Leases | |||||||||||||||||||||||
Operating | |||||||||||||||||||||||
We have entered into various non-cancelable operating leases with terms greater than one year for certain facilities and equipment used in our operations. The facility leases generally require us to pay operating costs: including property taxes, insurance and maintenance, and certain of them contain scheduled rent increases and renewal options. Leasehold improvements are amortized over their estimated useful lives or lease period, whichever is shorter. We recognize rent expense on a straight-line basis over the term of each lease. | |||||||||||||||||||||||
We incurred rent expense of $2.3 million, $2.9 million and $2.1 million for the years ended December 31, 2013, 2012, and 2011, respectively. | |||||||||||||||||||||||
Capital Leases | |||||||||||||||||||||||
As of December 31, 2013, we had seven capital leases, all of which expire between 2015 and 2021. As of December 31, 2013, the present value of the minimum remaining lease commitments was approximately $5.1 million, of which $0.7 million was due and payable within the next twelve months. The carrying amount of our capital lease obligations, net of imputed interest of $2.7 million, was $5.1 million as of December 31, 2013. See Note 12 for information regarding the capital leases we have entered into with related parties. | |||||||||||||||||||||||
Litigation, Regulatory Proceedings and Other Contingencies | |||||||||||||||||||||||
On April 15, 2008, Salsgiver Inc., a Pennsylvania-based telecommunications company, and certain of its affiliates filed a lawsuit against us and our subsidiaries North Pittsburgh Telephone Company and North Pittsburgh Systems Inc. in the Court of Common Pleas of Allegheny County, Pennsylvania alleging that we have prevented Salsgiver from connecting their fiber optic cables to our utility poles. Salsgiver seeks compensatory and punitive damages as the result of alleged lost projected profits, damage to its business reputation, and other costs. Salsgiver originally claimed to have sustained losses of approximately $125 million. We believe that these claims are without merit and that the alleged damages are completely unfounded. Discovery concluded and Consolidated filed a motion for summary judgment on June 18, 2012 and the court heard oral arguments on August 30, 2012. On February 12, 2013, the court, in part, granted our motion. The court ruled that Salsgiver could not recover prejudgment interest and could not use as a basis of liability any actions prior to April 14, 2006. In September 2013, in order to avoid the distraction and uncertainty of further litigation, we reached an agreement in principle (the “Agreement”) with Salsgiver, Inc. In accordance with the terms of the Agreement, we will pay Salsgiver approximately $0.9 million in cash and grant approximately $0.3 million in credits that may be used for make-ready charges (the “Credits”). The Credits will be available for services performed in connection with the pole attachment applications within five years of the execution of the agreement. We had previously recorded approximately $0.4 million in 2011 in anticipation of the settlement of this case. During the quarter ended September 30, 2013, per the terms of the agreement we recorded an additional $0.9 million, which included estimated legal fees. The agreement is contingent on appropriate documentation and there is no assurance that the agreement will be finalized. | |||||||||||||||||||||||
Two of our subsidiaries, Consolidated Communications of Pennsylvania Company LLC (“CCPA”) and Consolidated Communications Enterprise Services Inc. (“CCES”), have, at various times, received assessment notices from the Commonwealth of Pennsylvania Department of Revenue (“DOR”) increasing the amounts owed for Pennsylvania Gross Receipt Taxes, and/or have had audits performed for the tax years of 2008, 2009, and 2010. For the calendar years for which we received both additional assessment notices and audit actions, those issues have been combined by the DOR into a single Docket for each year. For the CCES subsidiary, the total additional tax liability calculated by the auditors for calendar years 2008, 2009, and 2010 is approximately $1.9 million. As of March 2013, all three of these cases have been appealed, and have received continuance pending the outcome of present litigation in the Commonwealth of Pennsylvania (Verizon Pennsylvania, Inc. v. Commonwealth, Docket No. 266 F.R. 2008). For the CCPA subsidiary, the total additional tax liability calculated by the auditors for calendar years 2008, 2009, and 2010 is approximately $2.0 million. As of December 2013, the cases for calendar years 2009 and 2010 have been appealed, and have received continuance pending the outcome of present litigation in the Commonwealth of Pennsylvania (Verizon Pennsylvania, Inc. v. Commonwealth, Docket No. 266 F.R. 2008). The calendar year 2008 audit is ongoing and we anticipate based on previous results that we will appeal the result to the Pennsylvania Board of Finance and Revenue on or before March 19, 2014. We anticipate that the 2008 case will be continued pending the outcome of the Verizon litigation as well. The Gross Receipts Tax issues in the Verizon Pennsylvania case are substantially the same as those presently facing CCPA and CCES. In addition, there are numerous telecommunications carriers with Gross Receipts Tax matters dealing with the same issues that are in various stages of appeal before the Board of Finance and Revenue and the Commonwealth Court. Those appeals by other similarly situated telecommunications carriers have been continued until resolution of the Verizon Pennsylvania case. We believe that these assessments and the positions taken by the Commonwealth of Pennsylvania are without substantial merit. We do not believe that the outcome of these claims will have a material adverse impact on our financial results. | |||||||||||||||||||||||
On January 18, 2012, we filed a petition with the U.S. Court of Appeals for the District of Columbia Circuit to review the FCC’s Order issued November 18, 2011 that reformed intercarrier compensation and core parts of the Universal Service Fund. We are appealing five core issues in the November 18, 2011 FCC order. This matter was heard by the U.S. Court of Appeals for the Tenth Circuit on November 19, 2013, however a decision is not expected before the third quarter of 2014. | |||||||||||||||||||||||
In order for eligible telecommunications carriers (“ETCs”) to receive high-cost support, the USF/ICC Transformation Order requires states to certify on an annual basis that federal universal service high-cost support (“USF”) is used “only for the provision, maintenance, and upgrading of facilities and services for which the support is intended”. States, in turn, require that ETCs file certifications with them as the basis for the state filings with the FCC. Failure to meet the annual data and certification deadlines can result in reduced support to the ETC based on the length of the delay in certification. For the calendar year 2013, the California state certification was due to be filed with the FCC on or before October 1, 2012. We were notified in January 2013 that SureWest did not submit the required certification to the California Public Utilities Commission (“CPUC”) in time to be included in its October 1, 2012, submission to the FCC. On January 24, 2013, we filed a certification with the CPUC and filed a petition with the FCC for a waiver of the filing deadline for the annual state certification. On February 19, 2013, the CPUC filed a certification with the FCC with respect to SureWest. On October 29, 2013, the Wireline Competition Bureau of the FCC denied our petition for a waiver of the annual certification deadline. On November 26, 2013, we applied for a review of the decision made by the FCC staff by the full Commission. Management believes, based on the change in SureWest Telephone’s USF filing status caused by the change in the ownership of SureWest Telephone, the lack of formal notice by the FCC regarding this change in filing status, the fact that SureWest Telephone had a previously-filed certification of compliance in effect with the FCC for the two quarters for which USF was withheld, and the FCC’s past practice of granting waivers to accept late filings in similar situations, that the Company should prevail in its application to the Commission and receive USF funding for the period January 1, 2013, through June 30, 2013. However, due to the denial of our petition by the Wireline Competition Bureau and the uncertainty of the collectability of the previously recognized revenues, in December 2013 we reversed the $3.0 million of previously recognized revenues until such time that the Commission has the opportunity to reach a decision on our application for review. | |||||||||||||||||||||||
We are from time to time involved in various other legal proceedings and regulatory actions arising out of our operations. We do not believe that any of these, individually or in the aggregate, will have a material adverse effect upon our business, operating results or financial condition. | |||||||||||||||||||||||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2013 | |
RELATED PARTY TRANSACTIONS | ' |
RELATED PARTY TRANSACTIONS | ' |
12. RELATED PARTY TRANSACTIONS | |
Capital Leases | |
Richard A. Lumpkin, a member of our Board of Directors, together with his family, beneficially owned 41.3% of Agracel, Inc. (“Agracel”), a real estate investment company, at December 31, 2013 and 2012. Mr. Lumpkin also is a director of Agracel. Agracel is the sole managing member and 50% owner of LATEL LLC (“LATEL”). Mr. Lumpkin and his immediate family had a 70.7% beneficial ownership of LATEL at December 31, 2013 and 2012. | |
As of December 31, 2013, we had three capital lease agreements with LATEL for the occupancy of three buildings on a triple net lease basis. In accordance with the Company’s related person transactions policy, these leases were approved by our Audit Committee and Board of Directors (“BOD”).We have accounted for these leases as capital leases in accordance with ASC Topic 840, Leases, and have capitalized the lower of the present value of the future minimum lease payments or their fair value. The capital lease agreements require us to pay substantially all expenses associated with general maintenance and repair, utilities, insurance, and taxes. Each of the three lease agreements have a maturity date of May 31, 2021 and each have two five-year options to extend the terms of the lease after the initial expiration date. We are required to pay LATEL approximately $7.9 million over the terms of the lease agreements. The carrying value of the capital leases at December 31, 2013 and 2012 was approximately $3.6 million and $3.8 million, respectively. We recognized $0.5 million in interest expense in 2013, 2012 and 2011 and amortization expense of $0.4 million in 2013 and 2012 and $0.1 in 2011, respectively, related to the capitalized leases. | |
Long-Term Debt | |
A portion of the Senior Notes was sold to certain accredited investors consisting of certain members of the Company’s Board of Directors, including the Company’s Chief Executive Officer (collectively “related parties”). In May 2012, the related parties purchased $10.8 million of the Senior Notes on the same terms available to other investors, except that the related parties were not entitled to registration rights. During 2013 and 2012, the Company paid $1.2 million and $0.6 million, respectively, in interest in the aggregate to the related parties for the Senior Notes. | |
QUARTERLY_FINANCIAL_INFORMATIO
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | ' | ||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | ' | ||||||||||||
13. QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | |||||||||||||
Quarter Ended | |||||||||||||
2013 | March 31 | June 30 | September 30 | December 31 | |||||||||
(In thousands, except per share amounts) | |||||||||||||
Net revenues | $ | 151,528 | $ | 151,320 | $ | 150,773 | $ | 147,956 | |||||
Operating income | $ | 28,330 | $ | 26,947 | $ | 26,167 | $ | 22,217 | |||||
Income from continuing operations | $ | 6,858 | $ | 9,560 | $ | 10,330 | $ | 3,216 | |||||
Discontinued operations, net of tax | $ | 24 | $ | -272 | $ | 1,425 | $ | - | |||||
Net income attributable to common stockholders | $ | 6,783 | $ | 9,194 | $ | 11,694 | $ | 3,140 | |||||
Basic and diluted earnings (loss) per share | |||||||||||||
Income from continuing operations | $ | 0.17 | $ | 0.23 | $ | 0.26 | $ | 0.08 | |||||
Discontinued operations, net of tax | - | -0.01 | 0.03 | - | |||||||||
Net income per basic and diluted common share attributable to common shareholders | $ | 0.17 | $ | 0.22 | $ | 0.29 | $ | 0.08 | |||||
Quarter Ended | |||||||||||||
2012 | March 31 | June 30 | September 30 | December 31 | |||||||||
(In thousands, except per share amounts) | |||||||||||||
Net revenues | $ | 86,451 | $ | 86,557 | $ | 151,025 | $ | 153,844 | |||||
Operating income | $ | 9,918 | $ | 13,147 | $ | 8,185 | $ | 20,167 | |||||
Income (loss) from continuing operations | $ | 1,177 | $ | 2,321 | $ | -1,311 | $ | 2,778 | |||||
Discontinued operations, net of tax | $ | 707 | $ | 585 | $ | 467 | $ | -553 | |||||
Net income (loss) attributable to common stockholders | $ | 1,759 | $ | 2,786 | $ | -965 | $ | 2,060 | |||||
Basic and diluted earnings (loss) per share: | |||||||||||||
Income from continuing operations | $ | 0.03 | $ | 0.07 | $ | -0.03 | $ | 0.07 | |||||
Discontinued operations, net of tax | 0.03 | 0.02 | 0.01 | -0.02 | |||||||||
Net income per basic and diluted common share attributable to common shareholders | $ | 0.06 | $ | 0.09 | $ | -0.02 | $ | 0.05 | |||||
As described in Note 3, in September 2013, we completed the sale of the assets and contractual rights of our prison services business for a total cash price of $2.5 million, resulting in a gain of $1.3 million, net of tax. The financial results of the operations for prison services have been reported as a discontinued operation in our consolidated financial statements for all periods presented. | |||||||||||||
During the third quarter of 2012, we acquired 100% of the outstanding shares of SureWest in a cash and stock transaction. SureWest results of operations have been included in our consolidated financial statements as of the acquisition date of July 2, 2012. | |||||||||||||
CONDENSED_CONSOLIDATING_FINANC
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ||||||||||||||||||||||||
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ||||||||||||||||||||||||
14. CONDENSED CONSOLIDATING FINANCIAL INFORMATION | |||||||||||||||||||||||||
Consolidated Communications, Inc. is the primary obligor under the unsecured Senior Notes it issued on May 30, 2012. We and the following of our subsidiaries: Consolidated Communications Enterprise Services, Inc., Consolidated Communications Services Company, Consolidated Communications of Fort Bend Company, Consolidated Communications of Texas Company, Consolidated Communications of Pennsylvania Company, LLC, SureWest Communications, SureWest Long Distance, SureWest Telephone, SureWest TeleVideo, SureWest Kansas, Inc., SureWest Kansas Holdings, Inc., SureWest Fiber Ventures, LLC, SureWest Kansas Connections, LLC, SureWest Kansas Licenses, LLC, SureWest Kansas Operations, LLC and SureWest Kansas Purchasing, LLC, have jointly and severally guaranteed the Senior Notes. All of the subsidiary guarantors are 100% direct or indirect wholly owned subsidiaries of the parent, and all guarantees are full, unconditional and joint and several with respect to principal, interest and liquidated damages, if any. As such, we present condensed consolidating balance sheets as of December 31, 2013 and 2012, and condensed consolidating statements of operations and cash flows for the years ended December 31, 2013, 2012 and 2011 for each of Consolidated Communications Holdings, Inc. (Parent), Consolidated Communications, Inc. (Subsidiary Issuer), guarantor subsidiaries and other non-guarantor subsidiaries with any consolidating adjustments. See Note 6 for more information regarding our Senior Notes. | |||||||||||||||||||||||||
Condensed Consolidating Balance Sheets | |||||||||||||||||||||||||
(amounts in thousands) | |||||||||||||||||||||||||
December 31, 2013 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||
Cash and cash equivalents | $ | - | $ | 86 | $ | 2,366 | $ | 3,099 | $ | - | $ | 5,551 | |||||||||||||
Accounts receivable, net | - | 502 | 44,521 | 7,010 | - | 52,033 | |||||||||||||||||||
Income taxes receivable | 9,346 | - | 370 | 80 | - | 9,796 | |||||||||||||||||||
Deferred income taxes | (61 | ) | (7 | ) | 7,533 | 495 | - | 7,960 | |||||||||||||||||
Prepaid expenses and other current assets | - | - | 11,862 | 518 | - | 12,380 | |||||||||||||||||||
Total current assets | 9,285 | 581 | 66,652 | 11,202 | - | 87,720 | |||||||||||||||||||
Property, plant and equipment, net | - | - | 834,199 | 51,163 | - | 885,362 | |||||||||||||||||||
Intangibles and other assets: | |||||||||||||||||||||||||
Investments | - | 3,729 | 109,370 | - | - | 113,099 | |||||||||||||||||||
Investments in subsidiaries | 1,101,039 | 335,659 | 12,130 | - | (1,448,828 | ) | - | ||||||||||||||||||
Goodwill | - | - | 537,265 | 66,181 | - | 603,446 | |||||||||||||||||||
Other intangible assets | - | - | 30,997 | 9,087 | - | 40,084 | |||||||||||||||||||
Deferred debt issuance costs, net and other assets | - | 13,620 | 4,047 | - | - | 17,667 | |||||||||||||||||||
Total assets | $ | 1,110,324 | $ | 353,589 | $ | 1,594,660 | $ | 137,633 | $ | (1,448,828 | ) | $ | 1,747,378 | ||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||
Accounts payable | $ | - | $ | - | $ | 4,885 | $ | - | $ | - | $ | 4,885 | |||||||||||||
Advance billings and customer deposits | - | - | 23,699 | 2,235 | - | 25,934 | |||||||||||||||||||
Dividends payable | 15,520 | - | - | - | - | 15,520 | |||||||||||||||||||
Accrued compensation | - | - | 20,447 | 1,805 | - | 22,252 | |||||||||||||||||||
Accrued expense | 224 | 4,389 | 32,709 | 1,375 | - | 38,697 | |||||||||||||||||||
Current portion of long term debt and capital | |||||||||||||||||||||||||
lease obligations | - | 9,100 | 586 | 65 | - | 9,751 | |||||||||||||||||||
Current portion of derivative liability | - | 660 | - | - | - | 660 | |||||||||||||||||||
Total current liabilities | 15,744 | 14,149 | 82,326 | 5,480 | - | 117,699 | |||||||||||||||||||
Long-term debt and capital lease obligations | - | 1,207,663 | 3,659 | 812 | - | 1,212,134 | |||||||||||||||||||
Advances due to/from affiliates, net | 968,319 | (1,970,192 | ) | 1,037,969 | (36,096 | ) | - | - | |||||||||||||||||
Deferred income taxes | (21,598 | ) | (1,029 | ) | 184,209 | 18,277 | 179,859 | ||||||||||||||||||
Pension and postretirement benefit obligations | - | - | 61,053 | 14,701 | - | 75,754 | |||||||||||||||||||
Other long-term liabilities | 25 | 1,960 | 7,328 | 280 | - | 9,593 | |||||||||||||||||||
Total liabilities | 962,490 | (747,449 | ) | 1,376,544 | 3,454 | - | 1,595,039 | ||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||
Common Stock | 401 | - | 17,411 | 30,000 | (47,411 | ) | 401 | ||||||||||||||||||
Other shareholders’ equity | 147,433 | 1,101,038 | 196,200 | 104,179 | (1,401,417 | ) | 147,433 | ||||||||||||||||||
Total Consolidated Communications Holdings, Inc. | |||||||||||||||||||||||||
shareholders’ equity | 147,834 | 1,101,038 | 213,611 | 134,179 | (1,448,828 | ) | 147,834 | ||||||||||||||||||
Noncontrolling interest | - | - | 4,505 | - | - | 4,505 | |||||||||||||||||||
Total shareholders’ equity | 147,834 | 1,101,038 | 218,116 | 134,179 | (1,448,828 | ) | 152,339 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,110,324 | $ | 353,589 | $ | 1,594,660 | $ | 137,633 | $ | (1,448,828 | ) | $ | 1,747,378 | ||||||||||||
December 31, 2012 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||
Cash and cash equivalents | $ | - | $ | 6,577 | $ | 8,530 | $ | 2,747 | $ | - | $ | 17,854 | |||||||||||||
Accounts receivable, net | 19 | 457 | 49,483 | 7,998 | - | 57,957 | |||||||||||||||||||
Income taxes receivable | 4,258 | - | 7,886 | (124 | ) | - | 12,020 | ||||||||||||||||||
Deferred income taxes | (51 | ) | (310 | ) | 8,985 | 376 | - | 9,000 | |||||||||||||||||
Prepaid expenses and other current assets | - | - | 10,855 | 414 | - | 11,269 | |||||||||||||||||||
Assets of discontinued operations | - | - | 1,189 | - | - | 1,189 | |||||||||||||||||||
Total current assets | 4,226 | 6,724 | 86,928 | 11,411 | - | 109,289 | |||||||||||||||||||
Property, plant and equipment, net | - | - | 855,158 | 52,514 | - | 907,672 | |||||||||||||||||||
Intangibles and other assets: | |||||||||||||||||||||||||
Investments | - | 3,641 | 106,094 | 15 | - | 109,750 | |||||||||||||||||||
Investments in subsidiaries | 958,199 | 219,955 | 11,234 | - | (1,189,388 | ) | - | ||||||||||||||||||
Goodwill | - | - | 537,265 | 66,181 | - | 603,446 | |||||||||||||||||||
Other intangible assets | - | - | 40,443 | 9,087 | - | 49,530 | |||||||||||||||||||
Deferred debt issuance costs, net and other assets | - | 12,788 | 1,012 | - | - | 13,800 | |||||||||||||||||||
Total assets | $ | 962,425 | $ | 243,108 | $ | 1,638,134 | $ | 139,208 | $ | (1,189,388 | ) | $ | 1,793,487 | ||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||
Accounts payable | $ | - | $ | - | $ | 14,954 | $ | - | $ | - | $ | 14,954 | |||||||||||||
Advance billings and customer deposits | - | - | 25,131 | 2,523 | - | 27,654 | |||||||||||||||||||
Dividends payable | 15,463 | - | - | - | - | 15,463 | |||||||||||||||||||
Accrued compensation | 36 | - | 19,863 | 2,013 | - | 21,912 | |||||||||||||||||||
Accrued expense | 235 | 3,373 | 39,673 | 3,944 | - | 47,225 | |||||||||||||||||||
Current portion of long term debt and capital | |||||||||||||||||||||||||
lease obligations | - | 9,242 | 300 | 54 | - | 9,596 | |||||||||||||||||||
Current portion of derivative liability | - | 3,164 | - | - | - | 3,164 | |||||||||||||||||||
Liabilities of discontinued operations | - | - | 4,209 | - | - | 4,209 | |||||||||||||||||||
Total current liabilities | 15,734 | 15,779 | 104,130 | 8,534 | - | 144,177 | |||||||||||||||||||
Long-term debt and capital lease obligations | - | 1,203,760 | 3,611 | 877 | - | 1,208,248 | |||||||||||||||||||
Advances due to/from affiliates, net | 817,118 | (1,934,978 | ) | 1,137,159 | (19,299 | ) | - | - | |||||||||||||||||
Deferred income taxes | (2,357 | ) | (3,571 | ) | 134,550 | 8,879 | - | 137,501 | |||||||||||||||||
Pension and postretirement benefit obligations | - | - | 125,706 | 31,004 | - | 156,710 | |||||||||||||||||||
Other long-term liabilities | - | 3,919 | 6,587 | 240 | - | 10,746 | |||||||||||||||||||
Total liabilities | 830,495 | (715,091 | ) | 1,511,743 | 30,235 | - | 1,657,382 | ||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||
Common Stock | 399 | - | 17,411 | 30,000 | (47,411 | ) | 399 | ||||||||||||||||||
Other shareholders’ equity | 131,531 | 958,199 | 104,805 | 78,973 | (1,141,977 | ) | 131,531 | ||||||||||||||||||
Total Consolidated Communications Holdings, Inc. | |||||||||||||||||||||||||
shareholders’ equity | 131,930 | 958,199 | 122,216 | 108,973 | (1,189,388 | ) | 131,930 | ||||||||||||||||||
Noncontrolling interest | - | - | 4,175 | - | - | 4,175 | |||||||||||||||||||
Total shareholders’ equity | 131,930 | 958,199 | 126,391 | 108,973 | (1,189,388 | ) | 136,105 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 962,425 | $ | 243,108 | $ | 1,638,134 | $ | 139,208 | $ | (1,189,388 | ) | $ | 1,793,487 | ||||||||||||
Condensed Consolidating Statements of Operations | |||||||||||||||||||||||||
(amounts in thousands) | |||||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net revenues | $ | - | $ | -60 | $ | 547,635 | $ | 68,128 | $ | -14,126 | $ | 601,577 | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Cost of services and products (exclusive of depreciation and amortization) | - | - | 220,764 | 14,635 | -12,947 | 222,452 | |||||||||||||||||||
Selling, general and administrative expenses | 3,608 | 167 | 113,942 | 18,876 | -1,179 | 135,414 | |||||||||||||||||||
Financing and other transaction costs | 457 | - | 319 | - | - | 776 | |||||||||||||||||||
Depreciation and amortization | - | - | 130,455 | 8,819 | - | 139,274 | |||||||||||||||||||
Operating income (loss) | -4,065 | -227 | 82,155 | 25,798 | - | 103,661 | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Interest expense, net of interest income | 100 | -86,090 | 181 | 42 | - | -85,767 | |||||||||||||||||||
Intercompany interest income (expense) | -103,588 | 126,918 | -24,662 | 1,332 | - | - | |||||||||||||||||||
Loss on extinguishment of debt | - | -7,657 | - | - | - | -7,657 | |||||||||||||||||||
Investment income | - | 89 | 37,606 | - | - | 37,695 | |||||||||||||||||||
Equity in earnings of subsidiaries, net | 98,055 | 74,479 | 896 | - | -173,430 | - | |||||||||||||||||||
Other, net | -18 | - | -448 | 10 | - | -456 | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | -9,516 | 107,512 | 95,728 | 27,182 | -173,430 | 47,476 | |||||||||||||||||||
Income tax expense (benefit) | -40,327 | 9,457 | 38,038 | 10,344 | - | 17,512 | |||||||||||||||||||
Income (loss) from continuing operations | 30,811 | 98,055 | 57,690 | 16,838 | -173,430 | 29,964 | |||||||||||||||||||
Discontinued operations, net of tax | - | - | 1,177 | - | - | 1,177 | |||||||||||||||||||
Net income (loss) | 30,811 | 98,055 | 58,867 | 16,838 | -173,430 | 31,141 | |||||||||||||||||||
Less: net income attributable to noncontrolling interest | - | - | 330 | - | - | 330 | |||||||||||||||||||
Net income (loss) attributable to Consolidated Communications Holdings, Inc. | $ | 30,811 | $ | 98,055 | $ | 58,537 | $ | 16,838 | $ | -173,430 | $ | 30,811 | |||||||||||||
Total comprehensive income (loss) attributable to common shareholders | $ | 30,811 | $ | 101,616 | $ | 91,395 | $ | 25,203 | $ | -173,430 | $ | 75,595 | |||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net revenues | $ | - | $ | (15) | $ | 423,303 | $ | 68,774 | $ | (14,185) | $ | 477,877 | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Cost of services and products (exclusive of depreciation and amortization) | - | - | 175,759 | 14,355 | -14,185 | 175,929 | |||||||||||||||||||
Selling, general and administrative expenses | 2,530 | 385 | 88,664 | 16,584 | - | 108,163 | |||||||||||||||||||
Financing and other transaction costs | 11,269 | 9,531 | - | - | - | 20,800 | |||||||||||||||||||
Intangible assets impairment | - | - | 1,236 | - | - | 1,236 | |||||||||||||||||||
Depreciation and amortization | - | - | 107,064 | 13,268 | - | 120,332 | |||||||||||||||||||
Operating income (loss) | -13,799 | -9,931 | 50,580 | 24,567 | - | 51,417 | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Interest expense, net of interest income | -20 | -71,704 | -816 | -64 | - | -72,604 | |||||||||||||||||||
Intercompany interest income (expense) | -50,126 | 87,717 | -37,509 | -82 | - | - | |||||||||||||||||||
Loss on extinguishment of debt | - | -4,455 | - | - | - | -4,455 | |||||||||||||||||||
Investment income | - | 246 | 30,421 | - | - | 30,667 | |||||||||||||||||||
Equity in earnings of subsidiaries, net | 48,942 | 48,272 | 1,435 | - | -98,649 | - | |||||||||||||||||||
Other, net | - | 1 | 617 | -17 | - | 601 | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | -15,003 | 50,146 | 44,728 | 24,404 | -98,649 | 5,626 | |||||||||||||||||||
Income tax expense (benefit) | -20,643 | 1,204 | 11,239 | 8,861 | - | 661 | |||||||||||||||||||
Income (loss) from continuing operations | 5,640 | 48,942 | 33,489 | 15,543 | -98,649 | 4,965 | |||||||||||||||||||
Discontinued operations, net of tax | - | - | 1,206 | - | - | 1,206 | |||||||||||||||||||
Net income (loss) | 5,640 | 48,942 | 34,695 | 15,543 | -98,649 | 6,171 | |||||||||||||||||||
Less: net income attributable to noncontrolling interest | - | - | 531 | - | - | 531 | |||||||||||||||||||
Net income (loss) attributable to Consolidated Communications Holdings, Inc. | $ | 5,640 | $ | 48,942 | $ | 34,164 | $ | 15,543 | $ | (98,649) | $ | 5,640 | |||||||||||||
Total comprehensive income (loss) attributable to common shareholders | $ | 5,640 | $ | 53,920 | $ | 24,816 | $ | 11,962 | $ | (98,649) | $ | (2,311) | |||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net revenues | $ | - | $ | 25 | $ | 291,500 | $ | 71,249 | $ | (13,771) | $ | 349,003 | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Cost of services and products (exclusive of depreciation and amortization) | - | - | 120,750 | 14,732 | -13,771 | 121,711 | |||||||||||||||||||
Selling, general and administrative expenses | 2,249 | 2,724 | 56,677 | 16,074 | - | 77,724 | |||||||||||||||||||
Financing and other transaction costs | - | - | 2,649 | - | - | 2,649 | |||||||||||||||||||
Depreciation and amortization | - | - | 72,999 | 15,091 | - | 88,090 | |||||||||||||||||||
Operating income (loss) | -2,249 | -2,699 | 38,425 | 25,352 | - | 58,829 | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Interest expense, net of interest income | - | -48,095 | -1,130 | -166 | - | -49,391 | |||||||||||||||||||
Intercompany interest income (expense) | -40,283 | 80,142 | -39,407 | -452 | - | - | |||||||||||||||||||
Investment income | - | 246 | 27,597 | - | - | 27,843 | |||||||||||||||||||
Equity in earnings of subsidiaries, net | 53,217 | 34,399 | 1,542 | - | -89,158 | - | |||||||||||||||||||
Other, net | - | - | 1,422 | -1,274 | - | 148 | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | 10,685 | 63,993 | 28,449 | 23,460 | -89,158 | 37,429 | |||||||||||||||||||
Income tax expense (benefit) | -15,725 | 10,776 | 9,219 | 8,871 | - | 13,141 | |||||||||||||||||||
Income (loss) from continuing operations | 26,410 | 53,217 | 19,230 | 14,589 | -89,158 | 24,288 | |||||||||||||||||||
Discontinued operations, net of tax | - | - | 2,694 | - | - | 2,694 | |||||||||||||||||||
Net income (loss) | 26,410 | 53,217 | 21,924 | 14,589 | -89,158 | 26,982 | |||||||||||||||||||
Less: net income attributable to noncontrolling interest | - | - | 572 | - | - | 572 | |||||||||||||||||||
Net income (loss) attributable to Consolidated Communications Holdings, Inc. | $ | 26,410 | $ | 53,217 | $ | 21,352 | $ | 14,589 | $ | (89,158) | $ | 26,410 | |||||||||||||
Total comprehensive income (loss) attributable to common shareholders | $ | 26,410 | $ | 60,814 | $ | 11,830 | $ | 10,152 | $ | (89,158) | $ | 20,048 | |||||||||||||
Condensed Consolidating Statements of Cash Flows | |||||||||||||||||||||||||
(amounts in thousands) | |||||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Consolidated | |||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net cash (used in) provided by continuing operations | $ | (88,251) | $ | 36,811 | $ | 195,591 | $ | 24,379 | $ | 168,530 | |||||||||||||||
Net cash used in discontinued operations | - | - | -4,174 | - | -4,174 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | -88,251 | 36,811 | 191,417 | 24,379 | 164,356 | ||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||
Purchases of property, plant and equipment | - | - | -100,139 | -7,224 | -107,363 | ||||||||||||||||||||
Purchase of investments | - | - | -403 | - | -403 | ||||||||||||||||||||
Proceeds from sale of assets | - | - | 282 | 48 | 330 | ||||||||||||||||||||
Net cash used in continuing operations | - | - | -100,260 | -7,176 | -107,436 | ||||||||||||||||||||
Net cash provided by discontinued operations | - | - | 2,331 | - | 2,331 | ||||||||||||||||||||
Net cash used in investing activities | - | - | -97,929 | -7,176 | -105,105 | ||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||
Proceeds from issuance of long-term debt | - | 989,450 | - | - | 989,450 | ||||||||||||||||||||
Payment of capital lease obligation | - | - | -462 | -54 | -516 | ||||||||||||||||||||
Payment on long-term debt | - | -990,961 | - | - | -990,961 | ||||||||||||||||||||
Payment of financing costs | - | -6,576 | - | - | -6,576 | ||||||||||||||||||||
Dividends on common stock | -62,064 | - | - | - | -62,064 | ||||||||||||||||||||
Purchase and retirement of common stock | -887 | - | - | - | -887 | ||||||||||||||||||||
Transactions with affiliates, net | 151,202 | -35,215 | -99,190 | -16,797 | - | ||||||||||||||||||||
Net cash provided by (used in) financing activities | 88,251 | -43,302 | -99,652 | -16,851 | -71,554 | ||||||||||||||||||||
(Decrease) increase in cash and cash equivalents | - | -6,491 | -6,164 | 352 | -12,303 | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | - | 6,577 | 8,530 | 2,747 | 17,854 | ||||||||||||||||||||
Cash and cash equivalents at end of period | $ | - | $ | 86 | $ | 2,366 | $ | 3,099 | $ | 5,551 | |||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Consolidated | |||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net cash (used in) provided by continuing operations | $ | -52,318 | $ | 13,106 | $ | 137,386 | $ | 21,558 | $ | 119,732 | |||||||||||||||
Net cash provided by discontinued operations | - | - | 3,483 | - | 3,483 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | -52,318 | 13,106 | 140,869 | 21,558 | 123,215 | ||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||
Business acquisition, net of cash acquired | -385,346 | - | - | - | -385,346 | ||||||||||||||||||||
Purchases of property, plant and equipment | - | - | -70,948 | -6,050 | -76,998 | ||||||||||||||||||||
Purchase of investments | - | - | -6,728 | - | -6,728 | ||||||||||||||||||||
Proceeds from sale of assets | - | - | 882 | 42 | 924 | ||||||||||||||||||||
Other | -314 | - | - | - | -314 | ||||||||||||||||||||
Net cash used in continuing operations | -385,660 | - | -76,794 | -6,008 | -468,462 | ||||||||||||||||||||
Net cash used in discontinued operations | - | - | -97 | - | -97 | ||||||||||||||||||||
Net cash used in investing activities | -385,660 | - | -76,891 | -6,008 | -468,559 | ||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||
Proceeds on bond offering | - | 298,035 | - | - | 298,035 | ||||||||||||||||||||
Proceeds from issuance of long-term debt | - | 544,850 | - | - | 544,850 | ||||||||||||||||||||
Payment of capital lease obligation | - | - | -183 | -45 | -228 | ||||||||||||||||||||
Payment on long-term debt | - | -510,038 | - | - | -510,038 | ||||||||||||||||||||
Payment of financing costs | - | -18,616 | - | - | -18,616 | ||||||||||||||||||||
Distributions to noncontrolling interest | - | - | 3,150 | -5,000 | -1,850 | ||||||||||||||||||||
Dividends on common stock | -54,100 | - | - | - | -54,100 | ||||||||||||||||||||
Purchase and retirement of common stock | -559 | - | - | - | -559 | ||||||||||||||||||||
Transactions with affiliates, net | 492,637 | -424,129 | -58,495 | -10,013 | - | ||||||||||||||||||||
Net cash provided by (used in) financing activities | 437,978 | -109,898 | -55,528 | -15,058 | 257,494 | ||||||||||||||||||||
(Decrease) increase in cash and cash equivalents | - | -96,792 | 8,450 | 492 | -87,850 | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | 103,369 | 80 | 2,255 | 105,704 | |||||||||||||||||||||
Cash and cash equivalents at end of period | $ | - | $ | 6,577 | $ | 8,530 | $ | 2,747 | $ | 17,854 | |||||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Consolidated | |||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net cash (used in) provided by continuing operations | $ | -27,033 | $ | 22,335 | $ | 98,764 | $ | 30,236 | $ | 124,302 | |||||||||||||||
Net cash provided by discontinued operations | - | - | 5,202 | - | 5,202 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | -27,033 | 22,335 | 103,966 | 30,236 | 129,504 | ||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||
Purchases of property, plant and equipment | - | - | -35,212 | -6,582 | -41,794 | ||||||||||||||||||||
Proceeds from sale of assets | - | - | 511 | 329 | 840 | ||||||||||||||||||||
Other | - | - | 272 | - | 272 | ||||||||||||||||||||
Net cash used in continuing operations | - | - | -34,429 | -6,253 | -40,682 | ||||||||||||||||||||
Net cash used in discontinued operations | - | - | -119 | - | -119 | ||||||||||||||||||||
Net cash used in investing activities | - | - | -34,548 | -6,253 | -40,801 | ||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||
Payment of capital lease obligation | - | - | -113 | -36 | -149 | ||||||||||||||||||||
Payment of financing costs | - | -3,471 | - | - | -3,471 | ||||||||||||||||||||
Dividends on common stock | -46,307 | - | - | - | -46,307 | ||||||||||||||||||||
Purchase and retirement of common stock | -726 | - | - | - | -726 | ||||||||||||||||||||
Transactions with affiliates, net | 74,066 | 19,107 | -69,277 | -23,896 | - | ||||||||||||||||||||
Net cash provided by (used in) financing activities | 27,033 | 15,636 | -69,390 | -23,932 | -50,653 | ||||||||||||||||||||
Increase in cash and cash equivalents | - | 37,971 | 28 | 51 | 38,050 | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | 65,398 | 52 | 2,204 | 67,654 | |||||||||||||||||||||
Cash and cash equivalents at end of period | $ | - | $ | 103,369 | $ | 80 | $ | 2,255 | $ | 105,704 | |||||||||||||||
BUSINESS_DESCRIPTION_SUMMARY_O1
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
Business and Basis of Accounting | ' | ||||||||||
Business and Basis of Accounting | |||||||||||
Consolidated Communications Holdings, Inc. (the “Company”, “we” or “our”) is a holding company with operating subsidiaries (collectively “Consolidated”) that provide communications services to residential and business customers in Illinois, Texas, Pennsylvania, California, Kansas and Missouri. | |||||||||||
We offer a wide range of telecommunications services to residential and business customers in the areas we serve. Our telecommunications services include local and long-distance service, high-speed broadband Internet access, video services, digital telephone service (“VOIP”), custom calling features, private line services, carrier grade access services, network capacity services over our regional fiber optic networks, directory publishing, Competitive Local Exchange Carrier (“CLEC”) services and equipment sales. As of December 31, 2013, we had approximately 257 thousand access lines, 123 thousand voice connections, 255 thousand data and Internet connections and 111 thousand video connections. | |||||||||||
We historically operated our business as two separate reportable segments: Telephone Operations and Other Operations. Based on changes in our business structure, during the quarter ended June 30, 2013 we concluded that we operate our business as one reportable segment. See the Recent Business Developments section below for a more detailed discussion regarding the circumstances that resulted in the change to our segment reporting. | |||||||||||
Use of Estimates | ' | ||||||||||
Use of Estimates | |||||||||||
Preparation of the financial statements in conformity with accounting principles generally accepted in the United States and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ materially from those estimates. Our critical accounting estimates include (i) impairment evaluations associated with indefinite-lived intangible assets (Note 1), (ii) revenue recognition (Note 1), (iii) derivatives (Notes 1 and 7), (iv) the determination of deferred tax asset and liability balances (Notes 1 and 10) and (v) pension plan and other post-retirement costs and obligations (Notes 1 and 9). Events subsequent to the balance sheet date have been evaluated for inclusion in the accompanying consolidated financial statements through the date of issuance. | |||||||||||
Principles of Consolidation | ' | ||||||||||
Principles of Consolidation | |||||||||||
Our consolidated financial statements include the accounts of the Company and our wholly-owned subsidiaries and subsidiaries in which we have a controlling financial interest. All significant intercompany transactions have been eliminated. | |||||||||||
Segment Reporting | ' | ||||||||||
Segment Reporting | |||||||||||
Historically, we classified our operations into two separate reportable business segments: Telephone Operations and Other Operations. Our Telephone Operations consisted of a wide range of telecommunications services to residential and business customers, including local and long-distance service, high-speed broadband Internet access, video services, VOIP services, custom calling features, private line services, carrier access services, network capacity services over a regional fiber optic network, mobile services and directory publishing. Our Other Operations segment operated two complementary non-core businesses including telephone services to state and county correctional facilities (“Prison Services”) and equipment sales. As discussed below, our contract to provide telephone services to correctional facilities operated by the Illinois Department of Corrections was not renewed and the process of transitioning those services to another service provider was completed during the quarter ended March 31, 2013. The remaining prison services assets and operations were classified as discontinued operations during the quarter ended June 30, 2013 and subsequently sold during the quarter ended September 30, 2013. Prison Services comprised nearly all of the Other Operations segment revenue and results of operations. Consequently, with the cessation of our Prison Services business and based on the segment accounting guidance, we concluded that we operate as one segment as of the quarter ended June 30, 2013. As required by the authoritative guidance for segment presentation, segment results of operations have been retrospectively adjusted to reflect this change for all periods presented. | |||||||||||
Prison Services Contract | ' | ||||||||||
Prison Services Contract | |||||||||||
We previously provided telephone service to inmates incarcerated at facilities operated by the Illinois Department of Corrections and to certain county jails. On June 27, 2012, the Illinois Department of Central Management Services announced its intent to replace us as the provider of those services with a competitor. Although we challenged our competitor’s bid and the State’s decision to accept that bid in a variety of different forums, during the quarter ended March 31, 2013, the process of transitioning these services to another service provider was completed. All related assets have been assessed for recoverability in light of this change and we determined that no impairment was necessary. During 2012, the prison services contract comprised 5% of consolidated operating revenues and approximately 2% of consolidated operating income, excluding financing and other transaction fees. | |||||||||||
Discontinued Operations | ' | ||||||||||
Discontinued Operations | |||||||||||
On September 13, 2013, we completed the sale of the assets and contractual rights used to provide communications services to inmates in thirteen county jails located in Illinois for a total purchase price of $2.5 million. In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 205-20, “Discontinued Operations”, the financial results of the prison services business have been reported as a discontinued operation in our consolidated financial statements for all periods presented. For a more complete discussion of the transaction, refer to Note 3. | |||||||||||
SureWest Merger | ' | ||||||||||
SureWest Merger | |||||||||||
We completed the acquisition of SureWest Communications on July 2, 2012. SureWest Communications’ results of operations are included within our results following the acquisition date. For a more complete discussion of the transaction, refer to Note 2. | |||||||||||
Cash and Cash Equivalents | ' | ||||||||||
Cash and Cash Equivalents | |||||||||||
We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Our cash equivalents consist primarily of money market funds. The carrying amounts of our cash equivalents approximate their fair value. | |||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | ' | ||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | |||||||||||
Accounts receivable consist primarily of amounts due to the Company from normal activities. We maintain an allowance for doubtful accounts for estimated losses, which result from the inability of our customers to make required payments. Such allowance is based on the likelihood of recoverability of accounts receivable based on past experience and management’s best estimates of current bad debt exposures. We perform ongoing credit evaluations of our customers’ financial condition and management believes that adequate allowances for doubtful accounts have been provided. Accounts are determined to be past due if customer payments have not been received in accordance with the payment terms. Uncollectible accounts are charged against the allowance for doubtful accounts and removed from the accounts receivable balances when internal collection efforts have been unsuccessful in collecting the amount due. The following table summarizes the activity in our accounts receivable allowance account for the years ended December 31, 2013, 2012 and 2011: | |||||||||||
Year Ended December 31, | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Balance at beginning of year | $ | 4,025 | $ | 2,547 | $ | 2,694 | |||||
Provision charged to expense | 515 | 5,615 | 4,104 | ||||||||
Write-offs, less recoveries | -2,942 | -4,137 | -4,251 | ||||||||
Balance at end of year | $ | 1,598 | $ | 4,025 | $ | 2,547 | |||||
Investments | ' | ||||||||||
Investments | |||||||||||
Our investments are primarily accounted for under either the equity or cost method. If we have the ability to exercise significant influence over the operations and financial policies of an affiliated company, the investment in the affiliated company is accounted for using the equity method. If we do not have control and also cannot exercise significant influence, the investment in the affiliated company is accounted for using the cost method. | |||||||||||
We review our investment portfolio periodically to determine whether there are identified events or circumstances that would indicate there is a decline in the fair value that is considered to be other than temporary. If we believe the decline is other than temporary, we evaluate the financial performance of the business and compare the carrying value of the investment to quoted market prices (if available) or the fair value of similar investments. If an investment is deemed to have experienced an impairment that is considered other-than temporary, the carrying amount of the investment is reduced to its quoted or estimated fair value, as applicable, and an impairment loss is recognized in other income (expense). | |||||||||||
Fair Value of Financial Instruments | ' | ||||||||||
Fair Value of Financial Instruments | |||||||||||
We account for certain assets and liabilities at fair value. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A financial asset or liability’s classification within a three-tiered value hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The hierarchy prioritizes the inputs to valuation techniques into three broad levels in order to maximize the use of observable inputs and minimize the use of unobservable inputs. The levels of the fair value hierarchy are as follows: | |||||||||||
Level 1 – Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. | |||||||||||
Level 2 – Inputs that reflect quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets and inputs other than quoted prices that are directly or indirectly observable in the marketplace. | |||||||||||
Level 3 – Unobservable inputs which are supported by little or no market activity. | |||||||||||
Property, Plant and Equipment | ' | ||||||||||
Property, Plant and Equipment | |||||||||||
Property, plant and equipment are recorded at cost. We capitalize additions and substantial improvements and expense repairs and maintenance costs as incurred. | |||||||||||
We capitalize the cost of internal-use network and non-network software which has a useful life in excess of one year. Subsequent additions, modifications or upgrades to internal-use network and non-network software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. Software maintenance and training costs are expensed in the period in which they are incurred. Also, we capitalize interest associated with the development of internal-use network and non-network software. | |||||||||||
Property, plant and equipment consisted of the following as of December 31, 2013 and 2012: | |||||||||||
(In thousands) | December 31, | December 31, | Estimated | ||||||||
2013 | 2012 | Useful Lives | |||||||||
Land and buildings | $ | 98,663 | $ | 94,929 | 18-40 years | ||||||
Network and outside plant facilities | 1,543,190 | 1,462,875 | 3-50 years | ||||||||
Furniture, fixtures and equipment | 99,578 | 95,671 | 3-15 years | ||||||||
Assets under capital lease | 11,169 | 10,375 | 3-11 years | ||||||||
Total plant in service | 1,752,600 | 1,663,850 | |||||||||
Less: accumulated depreciation and amortization | -899,926 | -779,461 | |||||||||
Plant in service | 852,674 | 884,389 | |||||||||
Construction in progress | 23,586 | 12,899 | |||||||||
Construction inventory | 9,102 | 10,384 | |||||||||
Totals | $ | 885,362 | $ | 907,672 | |||||||
Construction inventory, which is stated at weighted average cost, consists primarily of network construction materials and supplies that when issued are predominately capitalized as part of new customer installations and the construction of the network. | |||||||||||
We record depreciation using the straight line method over estimated useful lives using either the group or unit method. The useful lives are estimated at the time the assets are acquired and are based on historical experience with similar assets, anticipated technological changes and the expected impact of our strategic operating plan on our network infrastructure. The group method is used for depreciable assets dedicated to providing regulated telecommunication services, including the majority of the network and outside plant facilities. A depreciation rate for each asset group is developed based on the average useful life of the group. The group method requires periodic revision of depreciation rates. | |||||||||||
When an individual asset is sold or retired, the difference between the proceeds, if any, and the cost of the asset is charged or credited to accumulated depreciation, without recognition of a gain or loss. | |||||||||||
The unit method is primarily used for buildings, furniture, fixtures and other support assets. Each asset is depreciated on the straight-line basis over its estimated useful life. When an individual asset is sold or retired, the cost basis of the asset and related accumulated depreciation are removed from the accounts and any associated gain or loss is recognized. | |||||||||||
Depreciation and amortization expense was $129.9 million, $98.3 million and $66.3 million in 2013, 2012 and 2011, respectively. Amortization of assets under capital leases is included in depreciation and amortization expense. | |||||||||||
We evaluate the recoverability of our property, plant and equipment whenever events or substantive changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset group to estimated undiscounted future cash flows expected to be generated by the asset group. If the total of the expected future undiscounted cash flows were less than the carrying amount of the asset group, we would recognize an impairment charge for the difference between the estimated fair value and the carrying value of the asset group. | |||||||||||
Intangible Assets | ' | ||||||||||
Intangible Assets | |||||||||||
Indefinite-Lived Intangibles | |||||||||||
Goodwill and tradenames are evaluated for impairment annually or more frequently when events or changes in circumstances indicate that the asset might be impaired. We evaluate the carrying value of our indefinite-lived assets, tradenames and goodwill, as of November 30 of each year. As noted above, during the quarter ended June 30, 2013, we became a single reporting segment. As such we now evaluate our intangibles based on the single reporting segment. | |||||||||||
Tradenames | |||||||||||
Our most valuable tradename is the federally registered mark CONSOLIDATED, a design of interlocking circles, which is used in association with our telephone communication services. The Company’s corporate branding strategy leverages a CONSOLIDATED naming structure. With the acquisition of SureWest on July 2, 2012, we also own the tradenames associated with SureWest. All of the Company’s business units and several of our products and services incorporate the CONSOLIDATED name, except for the SureWest business units. We do not amortize our tradenames, as we have determined that they have an indefinite life. If facts and circumstances change relating to a tradenames continued use in the branding of our products and services, it may be treated as a finite-lived asset and begin to be amortized over its estimated remaining life. We estimate the fair value of our tradenames using discounted cash flows (“DCF”) based on a relief from royalty method. If the fair value of our tradenames was less than the carrying amount, we would recognize an impairment charge for the difference between the estimated fair value and the carrying value of the assets. We perform our impairment testing of our tradenames as single units of accounting based on their use in our single reporting unit. During the year ending December 31, 2013, a formal one-year plan to transition from the SureWest tradename to the CONSOLIDATED tradename was adopted. We began to amortize the $0.9 million assigned to the SureWest tradename over its estimated one-year useful life. During 2013, we recognized $0.5 million in amortization expense associated with the SureWest tradename. At December 31, 2013, the unamortized amount related to the SureWest tradename was $0.4 million. | |||||||||||
The carrying value of the reporting unit tradename, excluding any amounts assigned to the SureWest tradename, was $10.6 million at December 31, 2013 and 2012. For the years ended December 31, 2013 and 2012, we completed our annual impairment test using a DCF methodology based on a relief from royalty method and determined that there was no impairment of our tradename. During our annual assessment of carrying value of our tradenames in 2012, we determined that the carrying value of the tradename associated with the Business Systems reporting unit, which was previously included in our Other Operations segment, exceeded the estimated fair value and was impaired. During the quarter ended December 31, 2012, we recorded an impairment charge of $0.3 million to write off the carrying value of the tradename associated with the Business Systems reporting unit. | |||||||||||
Goodwill | |||||||||||
Goodwill is the excess of the acquisition cost of a business over the fair value of the identifiable net assets acquired. As noted above, goodwill is not amortized but instead evaluated annually for impairment using a preliminary qualitative assessment and two-step process, if deemed necessary. In 2012, we adopted an Accounting Standards Update No. 2011-08 – Intangibles-Goodwill and Other (Topic 350) Testing Goodwill for Impairment, that allows an entity to consider qualitative indicators to determine if the current two-step test is necessary. Under the provisions of the amended guidance, the step-one test of a reporting unit’s fair value is not required unless, as a result of the qualitative assessment, it is more likely than not (a likelihood of more than 50%) that fair value of the reporting unit is less than its carrying amount. Events and circumstances integrated into the qualitative assessment process include a combination of macroeconomic conditions affecting equity and credit markets, significant changes to the cost structure, overall financial performance and other relevant events affecting the reporting unit. A company is permitted to skip the qualitative assessment at its election, and proceed to Step 1 of the quantitative test, which we chose to do in 2013. In the first step of the impairment test, the fair value of our reporting unit is compared to its carrying amount, including goodwill. | |||||||||||
The estimated fair value of the reporting unit is determined using a combination of market-based approaches and a DCF model. The assumptions used in the estimate of fair value are based upon a combination of historical results and trends, new industry developments and future cash flow projections, as well as relevant comparable company earnings multiples for the market-based approaches. Such assumptions are subject to change as a result of changing economic and competitive conditions. We use a weighting of the results derived from the valuation approaches to estimate the fair value of the reporting unit. The fair value of the reporting unit exceeded the carrying value at December 31, 2013. | |||||||||||
If the carrying value of the reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss. In measuring the fair value of our reporting unit as previously described, we consider the combined carrying and fair values of our reporting unit in relation to our overall enterprise value, measured as the publicly traded stock price multiplied by the fully diluted shares outstanding plus the value of outstanding debt. Our reporting unit fair value models are consistent with a range in value indicated by both the preceding three month average stock price and the stock price on the valuation date, plus an estimated acquisition premium which is based on observable transactions of comparable companies, if applicable. | |||||||||||
The second step compares the implied fair value of the reporting unit goodwill with the carrying amount of that goodwill. The implied fair value is determined by allocating the fair value of the reporting unit to all of the assets and liabilities other than goodwill in a manner similar to a purchase price allocation. The excess of the fair value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. If the carrying amount of goodwill is greater than the implied fair value of that goodwill, then an impairment charge would be recorded equal to the difference between the implied fair value and the carrying value. At December 31, 2013 and 2012, the carrying value of goodwill was $603.4 million. | |||||||||||
For the 2012 evaluation, we used a DCF model to estimate the fair value of the Business Systems reporting unit, which was previously included in the Other Operations reporting segment. For the Business Systems reporting unit, the carrying value exceeded the fair value indicating a potential impairment existed. In the 2012 evaluation, we determined that based on the allocation of the fair value of the reporting unit to assets and liabilities in the second step of the impairment testing that the goodwill recorded for the Business Systems reporting unit was impaired and recorded an impairment charge of $0.8 million during the year ended December 31, 2012. | |||||||||||
Finite-Lived Intangible Assets | |||||||||||
Customer Lists | |||||||||||
Finite lived intangible assets subject to amortization consist primarily of our customer lists of an established base of customers that subscribe to our services. Customer lists are amortized on a straight-line basis over their estimated useful lives (ranging from 3 to 13 years) based upon our historical experience with customer attrition. In accordance with the applicable guidance relating to the impairment or disposal of long-lived assets, we evaluate the potential impairment of finite-lived intangible assets when impairment indicators exist. If the carrying value is no longer recoverable based upon the undiscounted future cash flows of the asset, an impairment equal to the difference between the carrying amount and the fair value of the asset is recognized. | |||||||||||
The net carrying amount of our customer lists as of December 31, 2013 and 2012 were as follows: | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Gross carrying amount | $ | 195,651 | $ | 195,651 | |||||||
Less: accumulated amortization | -166,500 | -157,579 | |||||||||
Net carrying amount | $ | 29,151 | $ | 38,072 | |||||||
Amortization expense for the years ended December 31, 2013, 2012 and 2011 was $8.9 million, $22.1 million and $21.8 million, respectively. The weighted-average remaining period over which customer lists are being amortized is 2.13 years. Expected amortization expense for the years 2014 through 2017 is as follows: | |||||||||||
(In thousands) | |||||||||||
2014 | $ | 8,921 | |||||||||
2015 | 8,849 | ||||||||||
2016 | 8,776 | ||||||||||
2017 | 2,605 | ||||||||||
Total | $ | 29,151 | |||||||||
Derivative Financial Instruments | ' | ||||||||||
Derivative Financial Instruments | |||||||||||
We use derivative financial instruments to manage our exposure to the risks associated with fluctuations in interest rates. Our interest rate swap agreements effectively convert a portion of our floating-rate debt to a fixed-rate basis, thereby reducing the impact of interest rate changes on future cash interest payments. At the inception of a hedge transaction, we formally document the relationship between the hedging instruments including our objective and strategy for establishing the hedge. In addition, the effectiveness of the derivative instrument is assessed at inception and on an ongoing basis throughout the hedging period. Counterparties to derivative instruments expose us to credit-related losses in the event of nonperformance. We execute agreements only with financial institutions we believe to be creditworthy and regularly assess the credit worthiness of each of the counterparties. We do not use derivative instruments for trading or speculative purposes. | |||||||||||
Derivative financial instruments are recorded at fair value in our consolidated balance sheet. Fair value is determined based on publicly available interest rate yield curves and an estimate of our nonperformance risk or our counterparty’s nonperformance credit risk, as applicable. We do not anticipate any nonperformance by any counterparty. | |||||||||||
For derivative instruments designated as a cash flow hedge, the effective portion of the change in the fair value is recognized as a component of accumulated other comprehensive income (loss) (“AOCI”) and is recognized as an adjustment to earnings over the period in which the hedged item impacts earnings. When an interest rate swap agreement terminates, any resulting gain or loss is recognized over the shorter of the remaining original term of the hedging instrument or the remaining life of the underlying debt obligation. The ineffective portion of the change in fair value of any hedging derivative is recognized immediately in earnings. If a derivative instrument is de-designated, the remaining gain or loss in AOCI on the date of de-designation is amortized to earnings over the remaining term of the hedging instrument. For derivative financial instruments that are not designated as a hedge, changes in fair value are recognized on a current basis in earnings. Cash flows from hedging activities are classified under the same category as the cash flows from the hedged items in our consolidated statement of cash flows. See Note 7 for further discussion of our derivative financial instruments. | |||||||||||
Share-based Compensation | ' | ||||||||||
Share-based Compensation | |||||||||||
Our share-based compensation consists of the issuance of restricted stock awards (“RSAs”) and performance share awards (“PSAs”) (collectively “stock awards”). Associated costs are based on a stock award’s estimated fair value at the date of the grant and are recognized over a period in which any related services are provided. We recognize the cost of RSAs and PSAs on a straight-line basis over the requisite service period, generally from immediate vest to a four-year vesting period. See Note 8 for further details regarding share-based compensation. | |||||||||||
Pension Plan and Other Post-Retirement Benefits | ' | ||||||||||
Pension Plan and Other Post-Retirement Benefits | |||||||||||
We maintain noncontributory defined benefit pension plans and provide certain post-retirement benefits other than pensions to certain eligible employees. We also maintain two unfunded supplemental retirement plans to provide incremental pension payments to certain former employees. | |||||||||||
We recognize pension expense during the current period in the consolidated income statement using certain assumptions, including the expected long-term rate of return on plan assets, interest cost implied by the discount rate and the amortization of unrecognized gains and losses. Refer to Note 9 for further details regarding the determination of these assumptions. | |||||||||||
We recognize the overfunded or underfunded status of our defined benefit pension and post-retirement plans as either an asset or liability in the consolidated balance sheet. We recognize changes in the funded status in the year | |||||||||||
in which the changes occur through comprehensive income, net of applicable income taxes, including unrecognized actuarial gains and losses and prior service costs and credits. | |||||||||||
Income Taxes | ' | ||||||||||
Income Taxes | |||||||||||
Our estimates of income taxes and the significant items resulting in the recognition of deferred tax assets and liabilities are disclosed in Note 10 and reflect our assessment of future tax consequences of transactions that have been reflected in our financial statements or tax returns for each taxing jurisdiction in which we operate. We base our provision for income taxes on our current period income, changes in our deferred income tax assets and liabilities, income tax rates, changes in estimates of our uncertain tax positions and tax planning opportunities available in the jurisdictions in which we operate. We recognize deferred tax assets and liabilities when there are temporary differences between the financial reporting basis and tax basis of our assets and liabilities and for the expected benefits of using net operating loss and tax credit loss carryforwards. We establish valuation allowances when necessary to reduce the carrying amount of deferred income tax assets to the amounts that we believe are more likely than not to be realized. We evaluate the need to retain all or a portion of the valuation allowance on our deferred tax assets. When a change in the tax rate or tax law has an impact on deferred taxes, we apply the change based on the years in which the temporary differences are expected to reverse. As we operate in more than one state, changes in our state apportionment factors, based on operational results, may affect our future effective tax rates and the value of our deferred tax assets and liabilities. We record a change in tax rates in our consolidated financial statements in the period of enactment. | |||||||||||
Income tax consequences that arise in connection with a business combination include identifying the tax basis of assets and liabilities acquired and any contingencies associated with uncertain tax positions assumed or resulting from the business combination. Deferred tax assets and liabilities related to temporary differences of an acquired entity are recorded as of the date of the business combination and are based on our estimate of the appropriate tax basis that will be accepted by the various taxing authorities. | |||||||||||
We record unrecognized tax benefits as liabilities in accordance with ASC 740 and adjust these liabilities in the appropriate period when our judgment changes as a result of the evaluation of new information. In certain instances, the ultimate resolution may result in a payment that is materially different from our current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. We classify interest and penalties, if any, associated with our uncertain tax positions as a component of interest expense and general and administrative expense, respectively. See Note 10 for additional information on income taxes. | |||||||||||
Revenue Recognition | ' | ||||||||||
Revenue Recognition | |||||||||||
We recognize revenue when (i) persuasive evidence of an arrangement exists between us and the customer, (ii) delivery of the product to the customer has occurred or service has been provided to the customer, (iii) the price to the customer is fixed or determinable and (iv) collectability of the sales price is reasonably assured. Revenues based on a flat fee, derived principally from local telephone, dedicated network access, data communications, Internet access service and residential/business broadband service are billed in advance and recognized in subsequent periods when the services are provided, with the exception of certain governmental accounts which are billed in arrears. Revenues for usage-based services, such as per-minute long-distance service and access charges billed to other telephone carriers for originating and terminating long-distance calls on our network, are billed in arrears. We recognize revenue from these services in the period the services are rendered rather than billed. Earned but unbilled usage-based services are recorded in accounts receivable. | |||||||||||
When required as part of providing service, revenues related to nonrefundable, upfront service activation and setup fees are deferred and recognized over the estimated customer life. | |||||||||||
Incremental direct costs of telecommunications service activation are charged to expense in the period in which they are incurred, except when we maintain ownership of wiring installed during the activation process. In such cases the cost is capitalized and depreciated over the estimated useful life of the asset. | |||||||||||
Telephone equipment revenues generated from retail channels are recorded at the point of sale. Telecommunications systems and structured cabling project revenues are recognized when the project is completed. Maintenance services are provided on both a contract and time and material basis and are recorded when the service is provided. Print advertising and publishing revenues are recognized ratably over the life of the related directory, generally 12 months. | |||||||||||
Subsidies, including universal service revenues, are government-sponsored support mechanisms to assist in funding services in mostly rural, high-cost areas. These revenues typically are based on information we provide and are calculated by the administering government agency. Subsidies are recognized in the period the service is provided. There is a reasonable possibility that out of period subsidy adjustments may be recorded in the future, but they are anticipated to be immaterial to our results of operation, financial position and cash flow. | |||||||||||
We collect and remit Federal Universal Service contributions on a gross basis, which resulted in recorded revenue of approximately $12.0 million for the year ended December 31, 2013. We account for all other taxes collected from customers and remitted to the respective government agencies on a net basis. | |||||||||||
Advertising Costs | ' | ||||||||||
Advertising Costs | |||||||||||
Advertising costs are expensed as incurred. Advertising expense was $7.6 million, $5.1 million and $2.4 million in 2013, 2012 and 2011, respectively. | |||||||||||
Statement of Cash Flows Information | ' | ||||||||||
Statement of Cash Flows Information | |||||||||||
During 2013, 2012 and 2011, we made payments for interest and income taxes as follows: | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Interest, net of amounts capitalized ($1,215, $515 and $144 in 2013, 2012 and 2011, respectively) | $ | 80,693 | $ | 63,541 | $ | 47,071 | |||||
Income taxes paid, net | $ | 960 | $ | 4,991 | $ | 8,788 | |||||
Noncash investing and financing activities: | |||||||||||
As described in Note 3, we issued $148.4 million in shares of the Company’s common stock in connection with the acquisition of SureWest in 2012. | |||||||||||
In 2013 and 2012, we acquired equipment of $0.8 million and $0.4 million, respectively, through capital lease agreements. | |||||||||||
Noncontrolling Interest | ' | ||||||||||
Noncontrolling Interest | |||||||||||
We have a majority-owned subsidiary, East Texas Fiber Line Incorporated (“ETFL”) which is a joint venture owned 63% by the Company and 37% by Eastex Telecom Investments, LLC. ETFL provides connectivity over a fiber optic transport network to certain customers residing in Texas. | |||||||||||
Recent Accounting Pronouncements | ' | ||||||||||
Recent Accounting Pronouncements | |||||||||||
In July 2013, the FASB issued the Accounting Standards Update No. 2013-11 (“ASU 2013-11”), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 provides guidance concerning the balance sheet presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward is present. The amended guidance is effective for fiscal years and interim periods beginning after December 15, 2013, with early adoption permitted. We are currently evaluating the impact this update will have on our consolidated financial statements. | |||||||||||
Effective January 1, 2013, we adopted Accounting Standards Update No. 2012-02 (“ASU 2012-02”), Testing Indefinite-Lived Intangible Assets for Impairment. ASU 2012-02 permits an entity to perform an initial assessment of qualitative factors to determine whether it is more likely than not that a non-goodwill indefinite-lived intangible asset is impaired and thus whether it is necessary to calculate the asset’s fair value for the purpose of comparing it with the asset’s carrying amount. The adoption of this standard did not have a material impact on our consolidated financial statements. | |||||||||||
Effective January 1, 2013, we adopted Accounting Standards Update No. 2013-02 (“ASU 2013-02”), Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which establishes new requirements for disclosing reclassifications of items out of accumulated other comprehensive income (“OCI”). ASU 2013-2 requires disclosures for the (i) changes in components of accumulated OCI, (ii) effects on individual line items in net income for each item of accumulated OCI that is reclassified in its entirety to net income, and (iii) cross references to other disclosures that provide additional details for OCI items that are not reclassified in their entirety to net income. For public companies, amendments were effective prospectively for reporting periods beginning after December 15, 2012, with early adoption permitted. In accordance with the provisions of this guidance, disclosures related to accumulated OCI can be found in Note 8. | |||||||||||
Reclassifications | ' | ||||||||||
Reclassifications | |||||||||||
Certain amounts in our 2012 and 2011 consolidated financial statements have been reclassified to conform to the presentation of our 2013 consolidated financial statements which consists of the effects of reclassifications from the presentation of prison services as a discontinued operation and the finalization of purchase accounting for the SureWest acquisition. These reclassifications had no effect on total shareholders’ equity, total revenue or net income. | |||||||||||
BUSINESS_DESCRIPTION_SUMMARY_O2
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||
Schedule of activity in the entity's accounts receivable allowance account | ' | ||||||||||
Year Ended December 31, | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Balance at beginning of year | $ | 4,025 | $ | 2,547 | $ | 2,694 | |||||
Provision charged to expense | 515 | 5,615 | 4,104 | ||||||||
Write-offs, less recoveries | -2,942 | -4,137 | -4,251 | ||||||||
Balance at end of year | $ | 1,598 | $ | 4,025 | $ | 2,547 | |||||
Schedule of property, plant and equipment | ' | ||||||||||
(In thousands) | December 31, | December 31, | Estimated | ||||||||
2013 | 2012 | Useful Lives | |||||||||
Land and buildings | $ | 98,663 | $ | 94,929 | 18-40 years | ||||||
Network and outside plant facilities | 1,543,190 | 1,462,875 | 3-50 years | ||||||||
Furniture, fixtures and equipment | 99,578 | 95,671 | 3-15 years | ||||||||
Assets under capital lease | 11,169 | 10,375 | 3-11 years | ||||||||
Total plant in service | 1,752,600 | 1,663,850 | |||||||||
Less: accumulated depreciation and amortization | -899,926 | -779,461 | |||||||||
Plant in service | 852,674 | 884,389 | |||||||||
Construction in progress | 23,586 | 12,899 | |||||||||
Construction inventory | 9,102 | 10,384 | |||||||||
Totals | $ | 885,362 | $ | 907,672 | |||||||
Schedule of carrying amount of customer lists | ' | ||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Gross carrying amount | $ | 195,651 | $ | 195,651 | |||||||
Less: accumulated amortization | -166,500 | -157,579 | |||||||||
Net carrying amount | $ | 29,151 | $ | 38,072 | |||||||
Schedule of expected amortization expense | ' | ||||||||||
(In thousands) | |||||||||||
2014 | $ | 8,921 | |||||||||
2015 | 8,849 | ||||||||||
2016 | 8,776 | ||||||||||
2017 | 2,605 | ||||||||||
Total | $ | 29,151 | |||||||||
Schedule of supplemental cash flow information | ' | ||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Interest, net of amounts capitalized ($1,215, $515 and $144 in 2013, 2012 and 2011, respectively) | $ | 80,693 | $ | 63,541 | $ | 47,071 | |||||
Income taxes paid, net | $ | 960 | $ | 4,991 | $ | 8,788 | |||||
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
EARNINGS PER SHARE | ' | ||||||||||
Schedule of basic and diluted earnings per share | ' | ||||||||||
(In thousands, except per share amounts) | 2013 | 2012 | 2011 | ||||||||
Income from continuing operations | $ | 29,964 | $ | 4,965 | $ | 24,288 | |||||
Less: net income attributable to noncontrolling interest | 330 | 531 | 572 | ||||||||
Income attributable to common shareholders before allocation of earnings to participating securities | 29,634 | 4,434 | 23,716 | ||||||||
Less: earnings allocated to participating securities | 466 | 351 | 429 | ||||||||
Income from continuing operations attributable to common shareholders | 29,168 | 4,083 | 23,287 | ||||||||
Net income from discontinued operations | 1,177 | 1,206 | 2,694 | ||||||||
Net income attributable to common shareholders | $ | 30,345 | $ | 5,289 | $ | 25,981 | |||||
Weighted-average number of common shares outstanding | 39,764 | 34,652 | 29,600 | ||||||||
Basic and diluted earnings per common share: | |||||||||||
Income from continuing operations | $ | 0.73 | $ | 0.12 | $ | 0.79 | |||||
Income from discontinued operations, net of tax | 0.03 | 0.03 | 0.09 | ||||||||
Net income per common share attributable to common shareholders | |||||||||||
$ | 0.76 | $ | 0.15 | $ | 0.88 | ||||||
ACQUISITION_AND_DISPOSITIONS_T
ACQUISITION AND DISPOSITIONS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
ACQUISITION AND DISPOSITIONS | ' | ||||||||||
Summary of final purchase price allocation | ' | ||||||||||
(In thousands) | |||||||||||
Current assets | $ | 47,073 | |||||||||
Property, plant and equipment | 591,818 | ||||||||||
Goodwill | 84,016 | ||||||||||
Other intangible assets | 3,600 | ||||||||||
Other long-term assets | 4,861 | ||||||||||
Total assets acquired | 731,368 | ||||||||||
Current liabilities | 53,566 | ||||||||||
Pension and other post-retirement obligations | 55,916 | ||||||||||
Deferred income taxes | 66,976 | ||||||||||
Other long-term liabilities | 4,114 | ||||||||||
Total liabilities assumed | 180,572 | ||||||||||
Net assets acquired | $ | 550,796 | |||||||||
Schedule of unaudited pro forma results | ' | ||||||||||
Year Ended | |||||||||||
December 31, | |||||||||||
(Unaudited; in thousands, except share amounts) | 2012 | ||||||||||
Operating revenues | $ | 605,779 | |||||||||
Income from operations | $ | 69,881 | |||||||||
Income from continuing operations | $ | 9,259 | |||||||||
Discontinued operations, net of tax | $ | 1,206 | |||||||||
Net income | $ | 10,465 | |||||||||
Less: income attributable to noncontrolling interest | 531 | ||||||||||
Net income attributable to common stockholders | $ | 9,934 | |||||||||
Net income per common share - basic and diluted | |||||||||||
Income from continuing operations | $ | 0.27 | |||||||||
Discontinued operations, net of tax | 0.03 | ||||||||||
Net income per basic and diluted common share attributable to common shareholders | $ | 0.3 | |||||||||
Schedule of major classes of the prison services assets and liabilities included in discontinued operations | ' | ||||||||||
(In thousands) | December 31, 2012 | ||||||||||
Accounts receivable, net | $ | 625 | |||||||||
Property, plant and equipment, net | 564 | ||||||||||
Total assets | $ | 1,189 | |||||||||
Accounts payable | $ | 13 | |||||||||
Advance billings and customer deposits | 938 | ||||||||||
Accrued expense | 3,258 | ||||||||||
Total liabilities | $ | 4,209 | |||||||||
Summary of the financial information for the prison services operations | ' | ||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Operating revenues | $ | 5,622 | $ | 25,580 | $ | 25,260 | |||||
Operating expenses including depreciation and amortization | 5,883 | 23,599 | 21,534 | ||||||||
Income (loss) from operations | -261 | 1,981 | 3,726 | ||||||||
Other income (expense) | - | - | 672 | ||||||||
Income tax expense (benefit) | -105 | 775 | 1,704 | ||||||||
Income (loss) from discontinued operations | $ | -156 | $ | 1,206 | $ | 2,694 | |||||
Gain on sale of discontinued operations, net of tax of $887 | $ | 1,333 | $ | - | $ | - | |||||
INVESTMENTS_Tables
INVESTMENTS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
INVESTMENTS | ' | ||||||||||
Schedule of investments | ' | ||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Cash surrender value of life insurance policies | $ | 2,183 | $ | 2,045 | |||||||
Cost method investments: | |||||||||||
GTE Mobilnet of South Texas Limited Partnership (2.34% interest) | 21,450 | 21,450 | |||||||||
Pittsburgh SMSA Limited Partnership (3.60% interest) | 22,950 | 22,950 | |||||||||
CoBank, ACB Stock | 5,112 | 5,023 | |||||||||
Other | 200 | 430 | |||||||||
Equity method investments: | |||||||||||
GTE Mobilnet of Texas RSA #17 Limited Partnership (20.51% interest) | 27,467 | 25,695 | |||||||||
Pennsylvania RSA 6(I) Limited Partnership (16.6725% interest) | 7,696 | 7,286 | |||||||||
Pennsylvania RSA 6(II) Limited Partnership (23.67% interest) | 24,105 | 23,338 | |||||||||
CVIN, LLC (13.455% interest) | 1,936 | 1,533 | |||||||||
Totals | $ | 113,099 | $ | 109,750 | |||||||
Summary of combined unaudited results of operations and financial position of our three equity investments in the cellular limited partnerships | ' | ||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Total revenues | $ | 321,555 | $ | 299,389 | $ | 305,965 | |||||
Income from operations | 98,962 | 83,577 | 84,803 | ||||||||
Net income before taxes | 99,024 | 83,633 | 84,844 | ||||||||
Net income | 99,024 | 83,283 | 84,483 | ||||||||
Current assets | $ | 54,837 | $ | 49,982 | $ | 44,739 | |||||
Non-current assets | 87,968 | 79,529 | 79,432 | ||||||||
Current liabilities | 15,221 | 15,417 | 14,523 | ||||||||
Non-current liabilities | 1,786 | 1,351 | 1,096 | ||||||||
Partnership equity | 125,799 | 112,734 | 108,552 | ||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
Schedule of interest rate swap liabilities measured at fair value on a recurring basis | ' | |||||||||||||
As of December 31, 2013 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Current interest rate swap liabilities | $ | -660 | – | $ | -660 | – | ||||||||
Long-term interest rate swap liabilities | -1,959 | – | -1,959 | – | ||||||||||
Total | $ | -2,619 | $ | – | $ | -2,619 | $ | – | ||||||
As of December 31, 2012 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Current interest rate swap liabilities | $ | -3,164 | – | $ | -3,164 | – | ||||||||
Long-term interest rate swap liabilities | -3,919 | – | -3,919 | – | ||||||||||
Total | $ | -7,083 | $ | – | $ | -7,083 | $ | – | ||||||
Schedule of other financial instruments that are not carried at fair value but which require fair value disclosure | ' | |||||||||||||
As of December 31, 2013 | As of December 31, 2012 | |||||||||||||
(In thousands) | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||
Investments, equity basis | $ | 61,204 | n/a | $ | 57,852 | n/a | ||||||||
Investments, at cost | $ | 49,712 | n/a | $ | 49,853 | n/a | ||||||||
Long-term debt, excluding capital leases | $ | 1,216,764 | $ | 1,261,508 | $ | 1,213,000 | $ | 1,231,355 | ||||||
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
LONG-TERM DEBT | ' | |||||||
Schedule of components of long-term debt outstanding, presented net of unamortized discounts | ' | |||||||
(In thousands) | 2013 | 2012 | ||||||
Senior secured credit facility: | ||||||||
Term loan 2 | $ | - | $ | 404,961 | ||||
Term loan 3, net of discount of $5,088 at December 31, 2012 | - | 509,912 | ||||||
Term loan 4, net of discount of $4,537 at December 31, 2013 | 905,463 | - | ||||||
Revolving loan | 13,000 | - | ||||||
Senior notes, net of discount of $1,699 and $1,873 at | ||||||||
December 31, 2013 and 2012, respectively | 298,301 | 298,127 | ||||||
Capital leases | 5,121 | 4,844 | ||||||
1,221,885 | 1,217,844 | |||||||
Less: current portion of long-term debt and capital leases | -9,751 | -9,596 | ||||||
Total long-term debt | $ | 1,212,134 | $ | 1,208,248 | ||||
Schedule of aggregate maturities of long-term debt | ' | |||||||
At December 31, 2013, the aggregate maturities of our long-term debt excluding capital leases were as follows: | ||||||||
(In thousands) | ||||||||
2014 | $ | 9,100 | ||||||
2015 | 9,100 | |||||||
2016 | 9,100 | |||||||
2017 | 9,100 | |||||||
2018 | 22,100 | |||||||
Thereafter | 1,164,500 | |||||||
Total maturities | 1,223,000 | |||||||
Less: Unamortized discount | -6,236 | |||||||
$ | 1,216,764 | |||||||
DERIVATIVE_FINANCIAL_INSTRUMEN1
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | ' | ||||||||||
Schedule of outstanding interest rate swaps | ' | ||||||||||
(In thousands) | Notional | 2013 Balance Sheet Location | Fair Value | ||||||||
Amount | |||||||||||
De-designated Hedges: | |||||||||||
Fixed to 1-month floating LIBOR | $ | 175,000 | Other long-term liabilities | $ | -1,897 | ||||||
Fixed to 1-month floating LIBOR | 100,000 | Current portion of derivative liability | -660 | ||||||||
Fixed to 1-month floating LIBOR (with floor) | 50,000 | Other long-term liabilities | -62 | ||||||||
Total Fair Values | $ | -2,619 | |||||||||
The following interest rate swaps were outstanding at December 31, 2012: | |||||||||||
(In thousands) | Notional | 2012 Balance Sheet Location | Fair Value | ||||||||
Amount | |||||||||||
Cash Flow Hedges: | |||||||||||
Fixed to 1-month floating LIBOR | $ | 200,000 | Other long-term liabilities | $ | -2,758 | ||||||
Fixed to 1-month floating LIBOR | 100,000 | Current portion of derivative liability | -1,069 | ||||||||
Forward starting fixed to 1-month floating LIBOR | 75,000 | Other long-term liabilities | -1,161 | ||||||||
De-designated Hedges: | |||||||||||
Fixed to 3-month floating LIBOR | 130,000 | Current portion of derivative liability | -1,300 | ||||||||
3-month floating LIBOR minus spread to 1-month floating LIBOR | 130,000 | Current portion of derivative liability | -16 | ||||||||
Fixed to 1-month floating LIBOR | 200,000 | Current portion of derivative liability | -779 | ||||||||
Total Fair Values | $ | -7,083 | |||||||||
Schedule of effect of interest rate derivatives designated as cash flow hedges on AOCI and on the consolidated statements of income | ' | ||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Loss recognized in AOCI, pretax | $ | -614 | $ | -5,631 | $ | -7,617 | |||||
Loss reclassified from AOCI to interest expense | $ | -5,875 | $ | -13,664 | $ | -19,649 | |||||
Gain arising from ineffectiveness reducing interest expense | $ | - | $ | 47 | $ | 93 | |||||
EQUITY_Tables
EQUITY (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
EQUITY | ' | ||||||||||||||||
Summary of the grants of RSAs and PSAs under the Plan | ' | ||||||||||||||||
Years Ended December 31, | |||||||||||||||||
Grant Date | Grant Date | Grant Date | |||||||||||||||
2013 | Fair Value | 2012 | Fair Value | 2011 | Fair Value | ||||||||||||
RSAs Granted | 168,516 | $ | 17.13 | 14,732 | $ | 19.3 | 127,377 | $ | 17.92 | ||||||||
PSAs Granted | 66,504 | $ | 17.13 | 68,540 | $ | 19.3 | 50,440 | $ | 17.92 | ||||||||
Total | 235,020 | 83,272 | 177,817 | ||||||||||||||
Summary of RSA and PSA activity | ' | ||||||||||||||||
RSAs | PSAs | ||||||||||||||||
Shares | Weighted | Shares | Weighted | ||||||||||||||
Average Grant | Average Grant | ||||||||||||||||
Date Fair Value | Date Fair Value | ||||||||||||||||
Non-vested shares outstanding - January 1, 2013 | 64,318 | $ | 18.33 | 58,221 | $ | 18.85 | |||||||||||
Shares granted | 168,516 | $ | 17.13 | 66,504 | $ | 17.13 | |||||||||||
Shares vested | -107,833 | $ | 17.61 | -60,459 | $ | 17.9 | |||||||||||
Shares forfeited, cancelled or retired | -1,500 | $ | 17.13 | – | $ | - | |||||||||||
Non-vested shares outstanding - December 31, 2013 | 123,501 | $ | 17.32 | 64,266 | $ | 17.96 | |||||||||||
Summary of total compensation costs recognized for share-based payments | ' | ||||||||||||||||
Year Ended December 31, | |||||||||||||||||
(In millions) | 2013 | 2012 | 2011 | ||||||||||||||
Restricted stock | $ | 1.8 | $ | 1.3 | $ | 1.3 | |||||||||||
Performance shares | 1.2 | 1 | 0.8 | ||||||||||||||
Total | $ | 3 | $ | 2.3 | $ | 2.1 | |||||||||||
Schedule of changes in accumulated other comprehensive loss, net of tax, by component | ' | ||||||||||||||||
Pension and | |||||||||||||||||
Post-Retirement | Derivative | ||||||||||||||||
(In thousands) | Obligations | Instruments | Total | ||||||||||||||
Balance at December 31, 2012 | $ | -40,581 | $ | -5,203 | $ | -45,784 | |||||||||||
Other comprehensive income before reclassifications | 39,381 | -381 | 39,000 | ||||||||||||||
Amounts reclassified from accumulated other comprehensive income | 1,843 | 3,941 | 5,784 | ||||||||||||||
Net current period other comprehensive income | 41,224 | 3,560 | 44,784 | ||||||||||||||
Balance at December 31, 2013 | $ | 643 | $ | -1,643 | $ | -1,000 | |||||||||||
Summary of reclassifications from accumulated other comprehensive loss | ' | ||||||||||||||||
Amount | |||||||||||||||||
Reclassified from | |||||||||||||||||
AOCI | |||||||||||||||||
Year Ended | Affected Line Item in the | ||||||||||||||||
(In thousands) | December 31, 2013 | Statement of Income | |||||||||||||||
Amortization of pension and post-retirement items: | |||||||||||||||||
Prior service credit | $ | -637 | (a) | ||||||||||||||
Actuarial loss | 3,652 | (a) | |||||||||||||||
3,015 | Total before tax | ||||||||||||||||
-1,172 | Tax benefit | ||||||||||||||||
$ | 1,843 | Net of tax | |||||||||||||||
Loss on cash flow hedges: | |||||||||||||||||
Interest rate derivatives | $ | 5,875 | Interest expense | ||||||||||||||
-1,934 | Tax benefit | ||||||||||||||||
$ | 3,941 | Net of tax | |||||||||||||||
(a) These items are included in the components of net periodic benefit cost for our pension and post-retirement benefit plans. See Note 9 for additional details. | |||||||||||||||||
PENSION_PLANS_AND_OTHER_POSTRE1
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Pension Plans and Other Post-retirement Benefits | ' | |||||||||||||
Schedule of expected benefit payments | ' | |||||||||||||
As of December 31, 2013, benefit payments expected to be paid over the next ten years are outlined in the following table: | ||||||||||||||
Other | ||||||||||||||
Pension | Post-retirement | |||||||||||||
(In thousands) | Plans | Plans | ||||||||||||
2014 | $ | 22,413 | $ | 3,495 | ||||||||||
2015 | 22,827 | 3,574 | ||||||||||||
2016 | 23,164 | 3,615 | ||||||||||||
2017 | 23,274 | 2,806 | ||||||||||||
2018 | 23,245 | 2,820 | ||||||||||||
2019 - 2023 | 116,421 | 12,867 | ||||||||||||
Defined Benefit Plans | ' | |||||||||||||
Pension Plans and Other Post-retirement Benefits | ' | |||||||||||||
Summary of change in benefit obligation, plan assets and funded status of the Retirement Plan, SureWest Plan and Supplemental Plans | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in benefit obligation | ||||||||||||||
Benefit obligation at the beginning of the year | $ | 379,528 | $ | 203,413 | ||||||||||
Service cost | 743 | 1,184 | ||||||||||||
Interest cost | 15,307 | 13,620 | ||||||||||||
Actuarial loss (gain) | (34,315 | ) | 32,274 | |||||||||||
Benefits paid | (21,559 | ) | (16,529 | ) | ||||||||||
Acquisition of SureWest Plans | - | 146,688 | ||||||||||||
Plan change | (2,361 | ) | (1,122 | ) | ||||||||||
Benefit obligation at the end of the year | $ | 337,343 | $ | 379,528 | ||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in plan assets | ||||||||||||||
Fair value of plan assets at the beginning of the year | $ | 262,778 | $ | 142,736 | ||||||||||
Employer contributions | 11,480 | 15,222 | ||||||||||||
Actual return on plan assets | 39,489 | 27,935 | ||||||||||||
Benefits paid | (21,559 | ) | (16,529 | ) | ||||||||||
Acquisition of SureWest Plans | - | 93,414 | ||||||||||||
Fair value of plan assets at the end of the year | $ | 292,188 | $ | 262,778 | ||||||||||
Funded status at year end | $ | (45,155 | ) | $ | (116,750 | ) | ||||||||
Schedule of amounts recognized in the consolidated balance sheets | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Current liabilities | $ | (254 | ) | $ | (254 | ) | ||||||||
Long-term liabilities | $ | (44,901 | ) | $ | (116,496 | ) | ||||||||
Schedule of amounts recognized in accumulated other comprehensive loss | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Unamortized prior service credit | $ | (4,426 | ) | $ | (2,523 | ) | ||||||||
Unamortized net actuarial loss | 10,302 | 67,104 | ||||||||||||
$ | 5,876 | $ | 64,581 | |||||||||||
Schedule of the components of net periodic pension cost recognized in the consolidated statements of income | ' | |||||||||||||
(In thousands) | 2013 | 2012 | 2011 | |||||||||||
Service cost | $ | 743 | $ | 1,184 | $ | 1,277 | ||||||||
Interest cost | 15,307 | 13,620 | 10,960 | |||||||||||
Expected return on plan assets | (20,654 | ) | (14,728 | ) | (10,893 | ) | ||||||||
Amortization of: | ||||||||||||||
Net actuarial loss | 3,652 | 2,518 | 786 | |||||||||||
Prior service credit | (457 | ) | (282 | ) | (166 | ) | ||||||||
Net periodic pension cost | $ | (1,409 | ) | $ | 2,312 | $ | 1,964 | |||||||
Summary of changes in plan assets and benefit obligations recognized in other comprehensive loss, before tax effects | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Actuarial loss (gain), net | $ | (53,149 | ) | $ | 19,066 | |||||||||
Recognized actuarial loss | (3,652 | ) | (2,518 | ) | ||||||||||
Prior service credit | (2,361 | ) | (1,122 | ) | ||||||||||
Recognized prior service credit | 457 | 282 | ||||||||||||
Total amount recognized in other comprehensive loss, before tax effects | $ | (58,705 | ) | $ | 15,708 | |||||||||
Schedule of weighted-average discount rate assumptions used to determine benefit obligations and net periodic pension benefit cost | ' | |||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Discount rate - net periodic benefit cost | 4.20% | 5.00% | 5.86% | |||||||||||
Discount rate - benefit obligation | 4.97% | 4.20% | 5.35% | |||||||||||
Expected long-term rate of return on plan assets | 8.00% | 7.70% | 7.50% | |||||||||||
Rate of compensation/salary increase | 1.75% | 1.50% | 3.06% | |||||||||||
Schedule of fair values of assets for the entity's defined benefit pension plans | ' | |||||||||||||
As of December 31, 2013 | ||||||||||||||
Significant | Significant | |||||||||||||
Quoted Prices | Other | Unobservable | ||||||||||||
In Active | Observable | Inputs | ||||||||||||
Markets for | Inputs | |||||||||||||
Identical Assets | ||||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 4,708 | $ | 2,835 | $ | 1,873 | $ | – | ||||||
Equities: | ||||||||||||||
Stocks: | ||||||||||||||
U.S. common stocks | 38,463 | 38,463 | – | – | ||||||||||
International stocks | 10,198 | 10,198 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 15,181 | – | 15,181 | – | ||||||||||
U.S. mid cap | 9,215 | 9,215 | – | – | ||||||||||
U.S. large cap | 34,535 | 11,101 | 23,434 | – | ||||||||||
Emerging markets | 20,225 | 12,855 | 7,370 | – | ||||||||||
International | 60,416 | 44,132 | 16,284 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 19,012 | 19,012 | – | – | ||||||||||
Corporate and municipal bonds | 8,624 | – | 8,624 | – | ||||||||||
Mortgage/asset-backed securities | 8,116 | – | 8,116 | – | ||||||||||
Common Collective Trust | 17,398 | – | 17,398 | |||||||||||
Mutual funds | 46,097 | 46,097 | – | – | ||||||||||
Total | $ | 292,188 | $ | 193,908 | $ | 98,280 | $ | – | ||||||
As of December 31, 2012 | ||||||||||||||
Significant | Significant | |||||||||||||
Quoted Prices | Other | Unobservable | ||||||||||||
In Active | Observable | Inputs | ||||||||||||
Markets for | Inputs | |||||||||||||
Identical Assets | ||||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 4,262 | $ | 1,036 | $ | 3,226 | $ | – | ||||||
Equities: | ||||||||||||||
Stocks: | ||||||||||||||
U.S. common stocks | 36,620 | 36,620 | – | – | ||||||||||
International stocks | 9,589 | 9,589 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 17,110 | – | 17,110 | – | ||||||||||
U.S. mid cap | 7,477 | 7,477 | – | – | ||||||||||
U.S. large cap | 35,130 | 12,932 | 22,198 | – | ||||||||||
Emerging markets | 7,807 | 7,807 | – | – | ||||||||||
International | 43,100 | 34,602 | 8,498 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 22,937 | 22,937 | – | – | ||||||||||
Corporate and municipal bonds | 9,238 | – | 9,238 | – | ||||||||||
Mortgage/asset-backed securities | 10,669 | – | 10,669 | – | ||||||||||
Common Collective Trust | 7,346 | 7,346 | ||||||||||||
Mutual funds | 51,493 | 51,493 | – | – | ||||||||||
Total | $ | 262,778 | $ | 184,493 | $ | 78,285 | $ | – | ||||||
(1) Short-term investments includes cash and cash equivalents and an investment in a common collective trust which is principally comprised of certificates of deposit, commercial paper and U.S. Treasury bills with maturities less than one year. | ||||||||||||||
Post-retirement Benefit Obligations | ' | |||||||||||||
Pension Plans and Other Post-retirement Benefits | ' | |||||||||||||
Summary of change in benefit obligation, plan assets and funded status of the Retirement Plan, SureWest Plan and Supplemental Plans | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in benefit obligation | ||||||||||||||
Benefit obligation at the beginning of the year | $ | 43,906 | $ | 33,184 | ||||||||||
Service cost | 925 | 811 | ||||||||||||
Interest cost | 1,575 | 1,756 | ||||||||||||
Plan participant contributions | 757 | 614 | ||||||||||||
Actuarial loss (gain) | (9,552 | ) | 5,282 | |||||||||||
Benefits paid | (3,966 | ) | (4,011 | ) | ||||||||||
Amendments | 1,448 | - | ||||||||||||
Acquisition | - | 6,270 | ||||||||||||
Benefit obligation at the end of the year | $ | 35,093 | $ | 43,906 | ||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Change in plan assets | ||||||||||||||
Fair value of plan assets at the beginning of the year | $ | 3,410 | $ | – | ||||||||||
Employer contributions | 2,772 | 3,189 | ||||||||||||
Plan participant’s contributions | 757 | 614 | ||||||||||||
Actual return on plan assets | 602 | 197 | ||||||||||||
Benefits paid | (3,966 | ) | (4,011 | ) | ||||||||||
Acquisition | – | 3,421 | ||||||||||||
Fair value of plan assets at the end of the year | $ | 3,575 | $ | 3,410 | ||||||||||
Funded status at year end | $ | (31,518 | ) | $ | (40,496 | ) | ||||||||
Schedule of amounts recognized in the consolidated balance sheets | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Current liabilities | $ | (2,429 | ) | $ | (2,467 | ) | ||||||||
Long-term liabilities | $ | (29,089 | ) | $ | (38,029 | ) | ||||||||
Schedule of amounts recognized in accumulated other comprehensive loss | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Unamortized prior service cost (credit) | $ | 183 | $ | (1,446 | ) | |||||||||
Unamortized net actuarial loss (gain) | (7,868 | ) | 2,055 | |||||||||||
$ | (7,685 | ) | $ | 609 | ||||||||||
Schedule of the components of net periodic pension cost recognized in the consolidated statements of income | ' | |||||||||||||
(In thousands) | 2013 | 2012 | 2011 | |||||||||||
Service cost | $ | 925 | $ | 811 | $ | 749 | ||||||||
Interest cost | 1,575 | 1,756 | 1,690 | |||||||||||
Expected return on plan assets | (233 | ) | (105 | ) | – | |||||||||
Amortization of: | ||||||||||||||
Net actuarial loss (gain) | – | – | (212 | ) | ||||||||||
Prior service credit | (180 | ) | (189 | ) | (189 | ) | ||||||||
Net periodic postretirement benefit cost | $ | 2,087 | $ | 2,273 | $ | 2,038 | ||||||||
Summary of changes in plan assets and benefit obligations recognized in other comprehensive loss, before tax effects | ' | |||||||||||||
(In thousands) | 2013 | 2012 | ||||||||||||
Actuarial loss (gain), net | $ | (9,922 | ) | $ | 5,191 | |||||||||
Prior service cost | 1,448 | – | ||||||||||||
Recognized prior service credit | 180 | 189 | ||||||||||||
Total amount recognized in other comprehensive loss, before tax effects | $ | (8,294 | ) | $ | 5,380 | |||||||||
Schedule of weighted-average discount rate assumptions used to determine benefit obligations and net periodic pension benefit cost | ' | |||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Net periodic benefit cost | 4.00% | 5.00% | 5.58% | |||||||||||
Benefit obligation | 4.40% | 3.90% | 5.22% | |||||||||||
Schedule of a one percent change in the assumed healthcare cost trend rate | ' | |||||||||||||
(In thousands) | 1% Increase | 1% Decrease | ||||||||||||
Effect on total of service and interest cost | $ | 277 | $ | (230 | ) | |||||||||
Effect on postretirement benefit obligation | $ | 2,063 | $ | (1,852 | ) | |||||||||
Schedule of fair values of assets for the entity's defined benefit pension plans | ' | |||||||||||||
As of December 31, 2013 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 89 | $ | 89 | $ | – | $ | – | ||||||
Equities: | ||||||||||||||
U.S. common stocks | 592 | 592 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 215 | – | 215 | – | ||||||||||
U.S. large cap | 638 | – | 638 | – | ||||||||||
Emerging markets | 263 | – | 263 | – | ||||||||||
International | 938 | 357 | 581 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 678 | 678 | – | – | ||||||||||
Corporate and municipal bonds | 308 | – | 308 | – | ||||||||||
Mortgage/asset-backed securities | 289 | – | 289 | – | ||||||||||
Total investments | $ | 4,010 | $ | 1,716 | $ | 2,294 | $ | – | ||||||
Benefit payments payable | -434 | |||||||||||||
Net plan assets | $ | 3,576 | ||||||||||||
As of December 31, 2012 | ||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||
In Active | Other | Unobservable | ||||||||||||
Markets for | Observable | Inputs | ||||||||||||
Identical Assets | Inputs | |||||||||||||
(In thousands) | Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||
Cash equivalents: | ||||||||||||||
Short-term investments(1) | $ | 30 | $ | 30 | $ | – | $ | – | ||||||
Equities: | ||||||||||||||
U.S. common stocks | 545 | 545 | – | – | ||||||||||
Funds: | ||||||||||||||
U.S. small cap | 238 | – | 238 | – | ||||||||||
U.S. large cap | 572 | – | 572 | – | ||||||||||
International | 576 | 289 | 287 | – | ||||||||||
Fixed Income: | ||||||||||||||
U.S. treasury and government agency securities | 776 | 776 | – | – | ||||||||||
Corporate and municipal bonds | 312 | – | 312 | – | ||||||||||
Mortgage/asset-backed securities | 361 | – | 361 | – | ||||||||||
Total | $ | 3,410 | $ | 1,640 | $ | 1,770 | $ | – | ||||||
(1) Short-term investments includes cash and cash equivalents and an investment in a common collective trust which is principally comprised of certificates of deposit, commercial paper and U.S. Treasury bills with maturities less than one year. | ||||||||||||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
INCOME TAXES | ' | ||||||||||
Schedule of components of income tax expense | ' | ||||||||||
For the Year Ended | |||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||
Current: | |||||||||||
Federal | $ | 1,381 | $ | 340 | $ | 4,118 | |||||
State | 86 | 1,078 | 477 | ||||||||
Total current expense (benefit) | 1,467 | 1,418 | 4,595 | ||||||||
Deferred: | |||||||||||
Federal | 15,929 | 1,998 | 8,209 | ||||||||
State | 116 | -2,755 | 337 | ||||||||
Total deferred expense (benefit) | 16,045 | -757 | 8,546 | ||||||||
Total income tax expense | $ | 17,512 | $ | 661 | $ | 13,141 | |||||
Schedule of reconciliation of the federal statutory tax rate to the effective tax rate | ' | ||||||||||
Year Ended December 31, | |||||||||||
(In percentages) | 2013 | 2012 | 2011 | ||||||||
Statutory federal income tax rate | 35 | 35 | 35 | ||||||||
State income taxes, net of federal benefit | 1.7 | -12.8 | 0.5 | ||||||||
Transaction costs | – | 14.9 | – | ||||||||
Other permanent differences | – | -1.1 | -0.9 | ||||||||
Change in uncertain tax positions | -1.7 | – | -0.7 | ||||||||
Change in deferred tax rate | – | -19.7 | 1.1 | ||||||||
Provision to return | 1.3 | -4.2 | – | ||||||||
Other | 0.6 | -0.4 | 0.1 | ||||||||
36.9 | 11.7 | 35.1 | |||||||||
Schedule of components of the net deferred tax liability | ' | ||||||||||
Year Ended December 31, | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Current deferred tax assets: | |||||||||||
Reserve for uncollectible accounts | $ | 615 | $ | 1,815 | |||||||
Accrued vacation pay deducted when paid | 2,196 | 1,727 | |||||||||
Accrued expenses and deferred revenue | 5,149 | 5,458 | |||||||||
7,960 | 9,000 | ||||||||||
Non-current deferred tax assets: | |||||||||||
Net operating loss carryforwards | 18,809 | 32,506 | |||||||||
Pension and postretirement obligations | 28,072 | 60,252 | |||||||||
Stock-based compensation | 495 | 450 | |||||||||
Derivative instruments | 1,004 | 3,004 | |||||||||
Financing costs | 1,503 | 567 | |||||||||
Tax credit carryforwards | 3,143 | 2,437 | |||||||||
Other | - | 305 | |||||||||
53,026 | 99,521 | ||||||||||
Valuation allowance | -535 | -535 | |||||||||
Net non-current deferred tax assets | 52,491 | 98,986 | |||||||||
Non-current deferred tax liabilities: | |||||||||||
Goodwill and other intangibles | -28,515 | -27,376 | |||||||||
Basis in investment | -38 | -120 | |||||||||
Partnership investments | -25,523 | -26,413 | |||||||||
Property, plant and equipment | -178,274 | -182,578 | |||||||||
-232,350 | -236,487 | ||||||||||
Net non-current deferred taxes | -179,859 | -137,501 | |||||||||
Net deferred income tax liabilities | $ | -171,899 | $ | -128,501 | |||||||
Schedule of reconciliation of the unrecognized tax benefits | ' | ||||||||||
Liability for | |||||||||||
Unrecognized | |||||||||||
Tax Benefits | |||||||||||
(In thousands) | 2013 | 2012 | |||||||||
Balance at January 1 | $ | 1,224 | $ | 1,224 | |||||||
Additions for tax positions in the current year | – | – | |||||||||
Additions for tax positions of prior years | – | – | |||||||||
Settlements with taxing authorities | – | – | |||||||||
Reduction for lapse of federal statute of limitations | – | – | |||||||||
Reduction for lapse of state statute of limitations | -1,224 | – | |||||||||
Balance at December 31 | $ | - | $ | 1,224 | |||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | ||||||||||||||||||||||
Summary of minimum annual contractual obligations and the estimated timing and effect the obligations will have on liquidity and cash flows | ' | ||||||||||||||||||||||
As of December 31, 2013, future minimum contractual obligations, including capital and operating leases, and the estimated timing and effect the obligations will have on our liquidity and cash flows in future periods are as follows: | |||||||||||||||||||||||
Minimum Annual Contractual Obligations | |||||||||||||||||||||||
(in thousands) | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | ||||||||||||||||
Operating lease agreements | $ | 1,272 | $ | 1,249 | $ | 1,054 | $ | 961 | $ | 960 | $ | 2,362 | $ | 7,858 | |||||||||
Capital lease agreements | 2,133 | 1,712 | 563 | 392 | 287 | 793 | 5,880 | ||||||||||||||||
Capital expenditures (1) | 8,384 | – | – | – | – | – | 8,384 | ||||||||||||||||
Service and support agreements (2) | 7,221 | 5,796 | 4,873 | 890 | 233 | – | 19,013 | ||||||||||||||||
Transport and data connectivity | 9,100 | 9,000 | 9,000 | 9,000 | – | – | 36,100 | ||||||||||||||||
Total | $ | 28,110 | $ | 17,757 | $ | 15,490 | $ | 11,243 | $ | 1,480 | $ | 3,155 | $ | 77,235 | |||||||||
(1) We have binding commitments with numerous suppliers for future capital expenditures. | |||||||||||||||||||||||
(2) We have entered into service and maintenance agreements to support various computer hardware and software applications and certain equipment. If we terminate any of the contracts prior to their expiration date, we would be liable for minimum commitment payments as defined in by the contractual terms of the contracts. |
QUARTERLY_FINANCIAL_INFORMATIO1
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | ' | ||||||||||||
Schedule of unaudited quarterly financial information | ' | ||||||||||||
Quarter Ended | |||||||||||||
2013 | March 31 | June 30 | September 30 | December 31 | |||||||||
(In thousands, except per share amounts) | |||||||||||||
Net revenues | $ | 151,528 | $ | 151,320 | $ | 150,773 | $ | 147,956 | |||||
Operating income | $ | 28,330 | $ | 26,947 | $ | 26,167 | $ | 22,217 | |||||
Income from continuing operations | $ | 6,858 | $ | 9,560 | $ | 10,330 | $ | 3,216 | |||||
Discontinued operations, net of tax | $ | 24 | $ | -272 | $ | 1,425 | $ | - | |||||
Net income attributable to common stockholders | $ | 6,783 | $ | 9,194 | $ | 11,694 | $ | 3,140 | |||||
Basic and diluted earnings (loss) per share | |||||||||||||
Income from continuing operations | $ | 0.17 | $ | 0.23 | $ | 0.26 | $ | 0.08 | |||||
Discontinued operations, net of tax | - | -0.01 | 0.03 | - | |||||||||
Net income per basic and diluted common share attributable to common shareholders | $ | 0.17 | $ | 0.22 | $ | 0.29 | $ | 0.08 | |||||
Quarter Ended | |||||||||||||
2012 | March 31 | June 30 | September 30 | December 31 | |||||||||
(In thousands, except per share amounts) | |||||||||||||
Net revenues | $ | 86,451 | $ | 86,557 | $ | 151,025 | $ | 153,844 | |||||
Operating income | $ | 9,918 | $ | 13,147 | $ | 8,185 | $ | 20,167 | |||||
Income (loss) from continuing operations | $ | 1,177 | $ | 2,321 | $ | -1,311 | $ | 2,778 | |||||
Discontinued operations, net of tax | $ | 707 | $ | 585 | $ | 467 | $ | -553 | |||||
Net income (loss) attributable to common stockholders | $ | 1,759 | $ | 2,786 | $ | -965 | $ | 2,060 | |||||
Basic and diluted earnings (loss) per share: | |||||||||||||
Income from continuing operations | $ | 0.03 | $ | 0.07 | $ | -0.03 | $ | 0.07 | |||||
Discontinued operations, net of tax | 0.03 | 0.02 | 0.01 | -0.02 | |||||||||
Net income per basic and diluted common share attributable to common shareholders | $ | 0.06 | $ | 0.09 | $ | -0.02 | $ | 0.05 | |||||
CONDENSED_CONSOLIDATING_FINANC1
CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ||||||||||||||||||||||||
Schedule of condensed consolidating balance sheets | ' | ||||||||||||||||||||||||
Condensed Consolidating Balance Sheets | |||||||||||||||||||||||||
(amounts in thousands) | |||||||||||||||||||||||||
December 31, 2013 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||
Cash and cash equivalents | $ | - | $ | 86 | $ | 2,366 | $ | 3,099 | $ | - | $ | 5,551 | |||||||||||||
Accounts receivable, net | - | 502 | 44,521 | 7,010 | - | 52,033 | |||||||||||||||||||
Income taxes receivable | 9,346 | - | 370 | 80 | - | 9,796 | |||||||||||||||||||
Deferred income taxes | (61 | ) | (7 | ) | 7,533 | 495 | - | 7,960 | |||||||||||||||||
Prepaid expenses and other current assets | - | - | 11,862 | 518 | - | 12,380 | |||||||||||||||||||
Total current assets | 9,285 | 581 | 66,652 | 11,202 | - | 87,720 | |||||||||||||||||||
Property, plant and equipment, net | - | - | 834,199 | 51,163 | - | 885,362 | |||||||||||||||||||
Intangibles and other assets: | |||||||||||||||||||||||||
Investments | - | 3,729 | 109,370 | - | - | 113,099 | |||||||||||||||||||
Investments in subsidiaries | 1,101,039 | 335,659 | 12,130 | - | (1,448,828 | ) | - | ||||||||||||||||||
Goodwill | - | - | 537,265 | 66,181 | - | 603,446 | |||||||||||||||||||
Other intangible assets | - | - | 30,997 | 9,087 | - | 40,084 | |||||||||||||||||||
Deferred debt issuance costs, net and other assets | - | 13,620 | 4,047 | - | - | 17,667 | |||||||||||||||||||
Total assets | $ | 1,110,324 | $ | 353,589 | $ | 1,594,660 | $ | 137,633 | $ | (1,448,828 | ) | $ | 1,747,378 | ||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||
Accounts payable | $ | - | $ | - | $ | 4,885 | $ | - | $ | - | $ | 4,885 | |||||||||||||
Advance billings and customer deposits | - | - | 23,699 | 2,235 | - | 25,934 | |||||||||||||||||||
Dividends payable | 15,520 | - | - | - | - | 15,520 | |||||||||||||||||||
Accrued compensation | - | - | 20,447 | 1,805 | - | 22,252 | |||||||||||||||||||
Accrued expense | 224 | 4,389 | 32,709 | 1,375 | - | 38,697 | |||||||||||||||||||
Current portion of long term debt and capital | |||||||||||||||||||||||||
lease obligations | - | 9,100 | 586 | 65 | - | 9,751 | |||||||||||||||||||
Current portion of derivative liability | - | 660 | - | - | - | 660 | |||||||||||||||||||
Total current liabilities | 15,744 | 14,149 | 82,326 | 5,480 | - | 117,699 | |||||||||||||||||||
Long-term debt and capital lease obligations | - | 1,207,663 | 3,659 | 812 | - | 1,212,134 | |||||||||||||||||||
Advances due to/from affiliates, net | 968,319 | (1,970,192 | ) | 1,037,969 | (36,096 | ) | - | - | |||||||||||||||||
Deferred income taxes | (21,598 | ) | (1,029 | ) | 184,209 | 18,277 | 179,859 | ||||||||||||||||||
Pension and postretirement benefit obligations | - | - | 61,053 | 14,701 | - | 75,754 | |||||||||||||||||||
Other long-term liabilities | 25 | 1,960 | 7,328 | 280 | - | 9,593 | |||||||||||||||||||
Total liabilities | 962,490 | (747,449 | ) | 1,376,544 | 3,454 | - | 1,595,039 | ||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||
Common Stock | 401 | - | 17,411 | 30,000 | (47,411 | ) | 401 | ||||||||||||||||||
Other shareholders’ equity | 147,433 | 1,101,038 | 196,200 | 104,179 | (1,401,417 | ) | 147,433 | ||||||||||||||||||
Total Consolidated Communications Holdings, Inc. | |||||||||||||||||||||||||
shareholders’ equity | 147,834 | 1,101,038 | 213,611 | 134,179 | (1,448,828 | ) | 147,834 | ||||||||||||||||||
Noncontrolling interest | - | - | 4,505 | - | - | 4,505 | |||||||||||||||||||
Total shareholders’ equity | 147,834 | 1,101,038 | 218,116 | 134,179 | (1,448,828 | ) | 152,339 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 1,110,324 | $ | 353,589 | $ | 1,594,660 | $ | 137,633 | $ | (1,448,828 | ) | $ | 1,747,378 | ||||||||||||
December 31, 2012 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||
Cash and cash equivalents | $ | - | $ | 6,577 | $ | 8,530 | $ | 2,747 | $ | - | $ | 17,854 | |||||||||||||
Accounts receivable, net | 19 | 457 | 49,483 | 7,998 | - | 57,957 | |||||||||||||||||||
Income taxes receivable | 4,258 | - | 7,886 | (124 | ) | - | 12,020 | ||||||||||||||||||
Deferred income taxes | (51 | ) | (310 | ) | 8,985 | 376 | - | 9,000 | |||||||||||||||||
Prepaid expenses and other current assets | - | - | 10,855 | 414 | - | 11,269 | |||||||||||||||||||
Assets of discontinued operations | - | - | 1,189 | - | - | 1,189 | |||||||||||||||||||
Total current assets | 4,226 | 6,724 | 86,928 | 11,411 | - | 109,289 | |||||||||||||||||||
Property, plant and equipment, net | - | - | 855,158 | 52,514 | - | 907,672 | |||||||||||||||||||
Intangibles and other assets: | |||||||||||||||||||||||||
Investments | - | 3,641 | 106,094 | 15 | - | 109,750 | |||||||||||||||||||
Investments in subsidiaries | 958,199 | 219,955 | 11,234 | - | (1,189,388 | ) | - | ||||||||||||||||||
Goodwill | - | - | 537,265 | 66,181 | - | 603,446 | |||||||||||||||||||
Other intangible assets | - | - | 40,443 | 9,087 | - | 49,530 | |||||||||||||||||||
Deferred debt issuance costs, net and other assets | - | 12,788 | 1,012 | - | - | 13,800 | |||||||||||||||||||
Total assets | $ | 962,425 | $ | 243,108 | $ | 1,638,134 | $ | 139,208 | $ | (1,189,388 | ) | $ | 1,793,487 | ||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||
Accounts payable | $ | - | $ | - | $ | 14,954 | $ | - | $ | - | $ | 14,954 | |||||||||||||
Advance billings and customer deposits | - | - | 25,131 | 2,523 | - | 27,654 | |||||||||||||||||||
Dividends payable | 15,463 | - | - | - | - | 15,463 | |||||||||||||||||||
Accrued compensation | 36 | - | 19,863 | 2,013 | - | 21,912 | |||||||||||||||||||
Accrued expense | 235 | 3,373 | 39,673 | 3,944 | - | 47,225 | |||||||||||||||||||
Current portion of long term debt and capital | |||||||||||||||||||||||||
lease obligations | - | 9,242 | 300 | 54 | - | 9,596 | |||||||||||||||||||
Current portion of derivative liability | - | 3,164 | - | - | - | 3,164 | |||||||||||||||||||
Liabilities of discontinued operations | - | - | 4,209 | - | - | 4,209 | |||||||||||||||||||
Total current liabilities | 15,734 | 15,779 | 104,130 | 8,534 | - | 144,177 | |||||||||||||||||||
Long-term debt and capital lease obligations | - | 1,203,760 | 3,611 | 877 | - | 1,208,248 | |||||||||||||||||||
Advances due to/from affiliates, net | 817,118 | (1,934,978 | ) | 1,137,159 | (19,299 | ) | - | - | |||||||||||||||||
Deferred income taxes | (2,357 | ) | (3,571 | ) | 134,550 | 8,879 | - | 137,501 | |||||||||||||||||
Pension and postretirement benefit obligations | - | - | 125,706 | 31,004 | - | 156,710 | |||||||||||||||||||
Other long-term liabilities | - | 3,919 | 6,587 | 240 | - | 10,746 | |||||||||||||||||||
Total liabilities | 830,495 | (715,091 | ) | 1,511,743 | 30,235 | - | 1,657,382 | ||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||
Common Stock | 399 | - | 17,411 | 30,000 | (47,411 | ) | 399 | ||||||||||||||||||
Other shareholders’ equity | 131,531 | 958,199 | 104,805 | 78,973 | (1,141,977 | ) | 131,531 | ||||||||||||||||||
Total Consolidated Communications Holdings, Inc. | |||||||||||||||||||||||||
shareholders’ equity | 131,930 | 958,199 | 122,216 | 108,973 | (1,189,388 | ) | 131,930 | ||||||||||||||||||
Noncontrolling interest | - | - | 4,175 | - | - | 4,175 | |||||||||||||||||||
Total shareholders’ equity | 131,930 | 958,199 | 126,391 | 108,973 | (1,189,388 | ) | 136,105 | ||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 962,425 | $ | 243,108 | $ | 1,638,134 | $ | 139,208 | $ | (1,189,388 | ) | $ | 1,793,487 | ||||||||||||
Schedule of condensed consolidating statements of operations | ' | ||||||||||||||||||||||||
Condensed Consolidating Statements of Operations | |||||||||||||||||||||||||
(amounts in thousands) | |||||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net revenues | $ | - | $ | -60 | $ | 547,635 | $ | 68,128 | $ | -14,126 | $ | 601,577 | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Cost of services and products (exclusive of depreciation and amortization) | - | - | 220,764 | 14,635 | -12,947 | 222,452 | |||||||||||||||||||
Selling, general and administrative expenses | 3,608 | 167 | 113,942 | 18,876 | -1,179 | 135,414 | |||||||||||||||||||
Financing and other transaction costs | 457 | - | 319 | - | - | 776 | |||||||||||||||||||
Depreciation and amortization | - | - | 130,455 | 8,819 | - | 139,274 | |||||||||||||||||||
Operating income (loss) | -4,065 | -227 | 82,155 | 25,798 | - | 103,661 | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Interest expense, net of interest income | 100 | -86,090 | 181 | 42 | - | -85,767 | |||||||||||||||||||
Intercompany interest income (expense) | -103,588 | 126,918 | -24,662 | 1,332 | - | - | |||||||||||||||||||
Loss on extinguishment of debt | - | -7,657 | - | - | - | -7,657 | |||||||||||||||||||
Investment income | - | 89 | 37,606 | - | - | 37,695 | |||||||||||||||||||
Equity in earnings of subsidiaries, net | 98,055 | 74,479 | 896 | - | -173,430 | - | |||||||||||||||||||
Other, net | -18 | - | -448 | 10 | - | -456 | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | -9,516 | 107,512 | 95,728 | 27,182 | -173,430 | 47,476 | |||||||||||||||||||
Income tax expense (benefit) | -40,327 | 9,457 | 38,038 | 10,344 | - | 17,512 | |||||||||||||||||||
Income (loss) from continuing operations | 30,811 | 98,055 | 57,690 | 16,838 | -173,430 | 29,964 | |||||||||||||||||||
Discontinued operations, net of tax | - | - | 1,177 | - | - | 1,177 | |||||||||||||||||||
Net income (loss) | 30,811 | 98,055 | 58,867 | 16,838 | -173,430 | 31,141 | |||||||||||||||||||
Less: net income attributable to noncontrolling interest | - | - | 330 | - | - | 330 | |||||||||||||||||||
Net income (loss) attributable to Consolidated Communications Holdings, Inc. | $ | 30,811 | $ | 98,055 | $ | 58,537 | $ | 16,838 | $ | -173,430 | $ | 30,811 | |||||||||||||
Total comprehensive income (loss) attributable to common shareholders | $ | 30,811 | $ | 101,616 | $ | 91,395 | $ | 25,203 | $ | -173,430 | $ | 75,595 | |||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net revenues | $ | - | $ | (15) | $ | 423,303 | $ | 68,774 | $ | (14,185) | $ | 477,877 | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Cost of services and products (exclusive of depreciation and amortization) | - | - | 175,759 | 14,355 | -14,185 | 175,929 | |||||||||||||||||||
Selling, general and administrative expenses | 2,530 | 385 | 88,664 | 16,584 | - | 108,163 | |||||||||||||||||||
Financing and other transaction costs | 11,269 | 9,531 | - | - | - | 20,800 | |||||||||||||||||||
Intangible assets impairment | - | - | 1,236 | - | - | 1,236 | |||||||||||||||||||
Depreciation and amortization | - | - | 107,064 | 13,268 | - | 120,332 | |||||||||||||||||||
Operating income (loss) | -13,799 | -9,931 | 50,580 | 24,567 | - | 51,417 | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Interest expense, net of interest income | -20 | -71,704 | -816 | -64 | - | -72,604 | |||||||||||||||||||
Intercompany interest income (expense) | -50,126 | 87,717 | -37,509 | -82 | - | - | |||||||||||||||||||
Loss on extinguishment of debt | - | -4,455 | - | - | - | -4,455 | |||||||||||||||||||
Investment income | - | 246 | 30,421 | - | - | 30,667 | |||||||||||||||||||
Equity in earnings of subsidiaries, net | 48,942 | 48,272 | 1,435 | - | -98,649 | - | |||||||||||||||||||
Other, net | - | 1 | 617 | -17 | - | 601 | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | -15,003 | 50,146 | 44,728 | 24,404 | -98,649 | 5,626 | |||||||||||||||||||
Income tax expense (benefit) | -20,643 | 1,204 | 11,239 | 8,861 | - | 661 | |||||||||||||||||||
Income (loss) from continuing operations | 5,640 | 48,942 | 33,489 | 15,543 | -98,649 | 4,965 | |||||||||||||||||||
Discontinued operations, net of tax | - | - | 1,206 | - | - | 1,206 | |||||||||||||||||||
Net income (loss) | 5,640 | 48,942 | 34,695 | 15,543 | -98,649 | 6,171 | |||||||||||||||||||
Less: net income attributable to noncontrolling interest | - | - | 531 | - | - | 531 | |||||||||||||||||||
Net income (loss) attributable to Consolidated Communications Holdings, Inc. | $ | 5,640 | $ | 48,942 | $ | 34,164 | $ | 15,543 | $ | (98,649) | $ | 5,640 | |||||||||||||
Total comprehensive income (loss) attributable to common shareholders | $ | 5,640 | $ | 53,920 | $ | 24,816 | $ | 11,962 | $ | (98,649) | $ | (2,311) | |||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Eliminations | Consolidated | ||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net revenues | $ | - | $ | 25 | $ | 291,500 | $ | 71,249 | $ | (13,771) | $ | 349,003 | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Cost of services and products (exclusive of depreciation and amortization) | - | - | 120,750 | 14,732 | -13,771 | 121,711 | |||||||||||||||||||
Selling, general and administrative expenses | 2,249 | 2,724 | 56,677 | 16,074 | - | 77,724 | |||||||||||||||||||
Financing and other transaction costs | - | - | 2,649 | - | - | 2,649 | |||||||||||||||||||
Depreciation and amortization | - | - | 72,999 | 15,091 | - | 88,090 | |||||||||||||||||||
Operating income (loss) | -2,249 | -2,699 | 38,425 | 25,352 | - | 58,829 | |||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Interest expense, net of interest income | - | -48,095 | -1,130 | -166 | - | -49,391 | |||||||||||||||||||
Intercompany interest income (expense) | -40,283 | 80,142 | -39,407 | -452 | - | - | |||||||||||||||||||
Investment income | - | 246 | 27,597 | - | - | 27,843 | |||||||||||||||||||
Equity in earnings of subsidiaries, net | 53,217 | 34,399 | 1,542 | - | -89,158 | - | |||||||||||||||||||
Other, net | - | - | 1,422 | -1,274 | - | 148 | |||||||||||||||||||
Income (loss) from continuing operations before income taxes | 10,685 | 63,993 | 28,449 | 23,460 | -89,158 | 37,429 | |||||||||||||||||||
Income tax expense (benefit) | -15,725 | 10,776 | 9,219 | 8,871 | - | 13,141 | |||||||||||||||||||
Income (loss) from continuing operations | 26,410 | 53,217 | 19,230 | 14,589 | -89,158 | 24,288 | |||||||||||||||||||
Discontinued operations, net of tax | - | - | 2,694 | - | - | 2,694 | |||||||||||||||||||
Net income (loss) | 26,410 | 53,217 | 21,924 | 14,589 | -89,158 | 26,982 | |||||||||||||||||||
Less: net income attributable to noncontrolling interest | - | - | 572 | - | - | 572 | |||||||||||||||||||
Net income (loss) attributable to Consolidated Communications Holdings, Inc. | $ | 26,410 | $ | 53,217 | $ | 21,352 | $ | 14,589 | $ | (89,158) | $ | 26,410 | |||||||||||||
Total comprehensive income (loss) attributable to common shareholders | $ | 26,410 | $ | 60,814 | $ | 11,830 | $ | 10,152 | $ | (89,158) | $ | 20,048 | |||||||||||||
Schedule of condensed consolidating statements of cash flows | ' | ||||||||||||||||||||||||
Condensed Consolidating Statements of Cash Flows | |||||||||||||||||||||||||
(amounts in thousands) | |||||||||||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Consolidated | |||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net cash (used in) provided by continuing operations | $ | (88,251) | $ | 36,811 | $ | 195,591 | $ | 24,379 | $ | 168,530 | |||||||||||||||
Net cash used in discontinued operations | - | - | -4,174 | - | -4,174 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | -88,251 | 36,811 | 191,417 | 24,379 | 164,356 | ||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||
Purchases of property, plant and equipment | - | - | -100,139 | -7,224 | -107,363 | ||||||||||||||||||||
Purchase of investments | - | - | -403 | - | -403 | ||||||||||||||||||||
Proceeds from sale of assets | - | - | 282 | 48 | 330 | ||||||||||||||||||||
Net cash used in continuing operations | - | - | -100,260 | -7,176 | -107,436 | ||||||||||||||||||||
Net cash provided by discontinued operations | - | - | 2,331 | - | 2,331 | ||||||||||||||||||||
Net cash used in investing activities | - | - | -97,929 | -7,176 | -105,105 | ||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||
Proceeds from issuance of long-term debt | - | 989,450 | - | - | 989,450 | ||||||||||||||||||||
Payment of capital lease obligation | - | - | -462 | -54 | -516 | ||||||||||||||||||||
Payment on long-term debt | - | -990,961 | - | - | -990,961 | ||||||||||||||||||||
Payment of financing costs | - | -6,576 | - | - | -6,576 | ||||||||||||||||||||
Dividends on common stock | -62,064 | - | - | - | -62,064 | ||||||||||||||||||||
Purchase and retirement of common stock | -887 | - | - | - | -887 | ||||||||||||||||||||
Transactions with affiliates, net | 151,202 | -35,215 | -99,190 | -16,797 | - | ||||||||||||||||||||
Net cash provided by (used in) financing activities | 88,251 | -43,302 | -99,652 | -16,851 | -71,554 | ||||||||||||||||||||
(Decrease) increase in cash and cash equivalents | - | -6,491 | -6,164 | 352 | -12,303 | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | - | 6,577 | 8,530 | 2,747 | 17,854 | ||||||||||||||||||||
Cash and cash equivalents at end of period | $ | - | $ | 86 | $ | 2,366 | $ | 3,099 | $ | 5,551 | |||||||||||||||
Year Ended December 31, 2012 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Consolidated | |||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net cash (used in) provided by continuing operations | $ | -52,318 | $ | 13,106 | $ | 137,386 | $ | 21,558 | $ | 119,732 | |||||||||||||||
Net cash provided by discontinued operations | - | - | 3,483 | - | 3,483 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | -52,318 | 13,106 | 140,869 | 21,558 | 123,215 | ||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||
Business acquisition, net of cash acquired | -385,346 | - | - | - | -385,346 | ||||||||||||||||||||
Purchases of property, plant and equipment | - | - | -70,948 | -6,050 | -76,998 | ||||||||||||||||||||
Purchase of investments | - | - | -6,728 | - | -6,728 | ||||||||||||||||||||
Proceeds from sale of assets | - | - | 882 | 42 | 924 | ||||||||||||||||||||
Other | -314 | - | - | - | -314 | ||||||||||||||||||||
Net cash used in continuing operations | -385,660 | - | -76,794 | -6,008 | -468,462 | ||||||||||||||||||||
Net cash used in discontinued operations | - | - | -97 | - | -97 | ||||||||||||||||||||
Net cash used in investing activities | -385,660 | - | -76,891 | -6,008 | -468,559 | ||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||
Proceeds on bond offering | - | 298,035 | - | - | 298,035 | ||||||||||||||||||||
Proceeds from issuance of long-term debt | - | 544,850 | - | - | 544,850 | ||||||||||||||||||||
Payment of capital lease obligation | - | - | -183 | -45 | -228 | ||||||||||||||||||||
Payment on long-term debt | - | -510,038 | - | - | -510,038 | ||||||||||||||||||||
Payment of financing costs | - | -18,616 | - | - | -18,616 | ||||||||||||||||||||
Distributions to noncontrolling interest | - | - | 3,150 | -5,000 | -1,850 | ||||||||||||||||||||
Dividends on common stock | -54,100 | - | - | - | -54,100 | ||||||||||||||||||||
Purchase and retirement of common stock | -559 | - | - | - | -559 | ||||||||||||||||||||
Transactions with affiliates, net | 492,637 | -424,129 | -58,495 | -10,013 | - | ||||||||||||||||||||
Net cash provided by (used in) financing activities | 437,978 | -109,898 | -55,528 | -15,058 | 257,494 | ||||||||||||||||||||
(Decrease) increase in cash and cash equivalents | - | -96,792 | 8,450 | 492 | -87,850 | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | 103,369 | 80 | 2,255 | 105,704 | |||||||||||||||||||||
Cash and cash equivalents at end of period | $ | - | $ | 6,577 | $ | 8,530 | $ | 2,747 | $ | 17,854 | |||||||||||||||
Year Ended December 31, 2011 | |||||||||||||||||||||||||
Parent | Subsidiary | Guarantors | Non-Guarantors | Consolidated | |||||||||||||||||||||
Issuer | |||||||||||||||||||||||||
Net cash (used in) provided by continuing operations | $ | -27,033 | $ | 22,335 | $ | 98,764 | $ | 30,236 | $ | 124,302 | |||||||||||||||
Net cash provided by discontinued operations | - | - | 5,202 | - | 5,202 | ||||||||||||||||||||
Net cash (used in) provided by operating activities | -27,033 | 22,335 | 103,966 | 30,236 | 129,504 | ||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||
Purchases of property, plant and equipment | - | - | -35,212 | -6,582 | -41,794 | ||||||||||||||||||||
Proceeds from sale of assets | - | - | 511 | 329 | 840 | ||||||||||||||||||||
Other | - | - | 272 | - | 272 | ||||||||||||||||||||
Net cash used in continuing operations | - | - | -34,429 | -6,253 | -40,682 | ||||||||||||||||||||
Net cash used in discontinued operations | - | - | -119 | - | -119 | ||||||||||||||||||||
Net cash used in investing activities | - | - | -34,548 | -6,253 | -40,801 | ||||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||
Payment of capital lease obligation | - | - | -113 | -36 | -149 | ||||||||||||||||||||
Payment of financing costs | - | -3,471 | - | - | -3,471 | ||||||||||||||||||||
Dividends on common stock | -46,307 | - | - | - | -46,307 | ||||||||||||||||||||
Purchase and retirement of common stock | -726 | - | - | - | -726 | ||||||||||||||||||||
Transactions with affiliates, net | 74,066 | 19,107 | -69,277 | -23,896 | - | ||||||||||||||||||||
Net cash provided by (used in) financing activities | 27,033 | 15,636 | -69,390 | -23,932 | -50,653 | ||||||||||||||||||||
Increase in cash and cash equivalents | - | 37,971 | 28 | 51 | 38,050 | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | 65,398 | 52 | 2,204 | 67,654 | |||||||||||||||||||||
Cash and cash equivalents at end of period | $ | - | $ | 103,369 | $ | 80 | $ | 2,255 | $ | 105,704 | |||||||||||||||
BUSINESS_DESCRIPTION_SUMMARY_O3
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||
Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Sep. 13, 2013 | |
item | item | item | |||||
Business and Basis of Accounting | ' | ' | ' | ' | ' | ' | ' |
Number of access lines | ' | ' | 257,000 | ' | ' | ' | ' |
Number of voice connections | ' | ' | 123,000 | ' | ' | ' | ' |
Number of data and internet connections | ' | ' | 255,000 | ' | ' | ' | ' |
Number of video connections | ' | ' | 111,000 | ' | ' | ' | ' |
Recent Business Developments | ' | ' | ' | ' | ' | ' | ' |
Prison service contract as a percentage of revenue | ' | ' | ' | 5.00% | ' | ' | ' |
Prison service contract as a percentage of operating income, excluding financing and other transaction fees | ' | ' | ' | 2.00% | ' | ' | ' |
Discontinued Operations | ' | ' | ' | ' | ' | ' | ' |
Total purchase price for the sale of the assets and contractual rights related to prison services | ' | ' | ' | ' | ' | $2,500,000 | $2,500,000 |
Segment Reporting | ' | ' | ' | ' | ' | ' | ' |
Number of reportable business segments | 1 | 2 | ' | ' | ' | ' | ' |
Number of non-core businesses | ' | ' | 2 | ' | ' | ' | ' |
Activity in the entity's accounts receivable allowance | ' | ' | ' | ' | ' | ' | ' |
Balance at beginning of year | ' | 4,025,000 | 4,025,000 | 2,547,000 | 2,694,000 | ' | ' |
Provision charged to expense | ' | ' | 515,000 | 5,615,000 | 4,104,000 | ' | ' |
Write-offs, less recoveries | ' | ' | -2,942,000 | -4,137,000 | -4,251,000 | ' | ' |
Balance at end of year | ' | ' | $1,598,000 | $4,025,000 | $2,547,000 | ' | ' |
BUSINESS_DESCRIPTION_SUMMARY_O4
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, plant and equipment | ' | ' | ' |
Total plant in service | $1,752,600,000 | $1,663,850,000 | ' |
Less: accumulated depreciation and amortization | -899,926,000 | -779,461,000 | ' |
Plant in service | 852,674,000 | 884,389,000 | ' |
Totals | 885,362,000 | 907,672,000 | ' |
Depreciation and amortization expense | 129,900,000 | 98,300,000 | 66,300,000 |
Land and buildings | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total plant in service | 98,663,000 | 94,929,000 | ' |
Land and buildings | Minimum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '18 years | ' | ' |
Land and buildings | Maximum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '40 years | ' | ' |
Network and outside plant facilities | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total plant in service | 1,543,190,000 | 1,462,875,000 | ' |
Network and outside plant facilities | Minimum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '3 years | ' | ' |
Network and outside plant facilities | Maximum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '50 years | ' | ' |
Furniture, fixtures and equipment | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total plant in service | 99,578,000 | 95,671,000 | ' |
Furniture, fixtures and equipment | Minimum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '3 years | ' | ' |
Furniture, fixtures and equipment | Maximum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '15 years | ' | ' |
Assets under capital lease | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total plant in service | 11,169,000 | 10,357,000 | ' |
Assets under capital lease | Minimum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '3 years | ' | ' |
Assets under capital lease | Maximum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Estimated Useful Lives | '11 years | ' | ' |
Construction in progress | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total plant in service | 23,586,000 | 12,899,000 | ' |
Construction inventory | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Total plant in service | $9,102,000 | $10,384,000 | ' |
Internal use network and non-network software | Maximum | ' | ' | ' |
Property, plant and equipment | ' | ' | ' |
Period after which property plan and equipment capitalized | '1 year | ' | ' |
BUSINESS_DESCRIPTION_SUMMARY_O5
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) (USD $) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Indefinite-Lived Intangibles | ' | ' | ' |
Indefinitely renewable tradenames | $10,600,000 | $10,600,000 | $10,600,000 |
Impairment charge for tradenames | 300,000 | 0 | 0 |
Tradenames | SureWest | ' | ' | ' |
Indefinite-Lived Intangibles | ' | ' | ' |
Gross carrying amount of tradename | ' | 900,000 | ' |
Useful life of assets | ' | '1 year | ' |
Amortization of intangible assets | ' | 500,000 | ' |
Net carrying amount | ' | $400,000 | ' |
BUSINESS_DESCRIPTION_SUMMARY_O6
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Goodwill | ' | ' |
Preceding period of average stock price used to calculate impairment of reporting unit under the fair value model | '3 months | ' |
Impairment charge for goodwill | ' | $800,000 |
Goodwill | $603,446,000 | $603,446,000 |
BUSINESS_DESCRIPTION_SUMMARY_O7
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 5) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
item | |||||||||||
Share-based Compensation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting period over which the cost of RSAs and PSAs is recognized | ' | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | ' |
Pension Plan and Other Post-Retirement Benefits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of non-qualified plans | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum number of states in which entity operates | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' |
Revenue Recognition | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period over which print advertising and publishing revenues recognized based on life of related directory | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' |
Revenue recorded | $147,956,000 | $150,773,000 | $151,320,000 | $151,528,000 | $153,844,000 | $151,025,000 | $86,557,000 | $86,451,000 | $601,577,000 | $477,877,000 | $349,003,000 |
Advertising costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advertising expense | ' | ' | ' | ' | ' | ' | ' | ' | 7,600,000 | 5,100,000 | 2,400,000 |
Statement of Cash Flows Information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest, net of amounts capitalized | ' | ' | ' | ' | ' | ' | ' | ' | 80,693,000 | 63,541,000 | 47,071,000 |
Interest capitalized | ' | ' | ' | ' | ' | ' | ' | ' | 1,215,000 | 515,000 | 144,000 |
Income taxes paid, net | ' | ' | ' | ' | ' | ' | ' | ' | 960,000 | 4,991,000 | 8,788,000 |
Noncash investing and financing activities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued under acquisition | ' | ' | ' | ' | ' | ' | ' | ' | ' | 148,400,000 | ' |
Equipment acquired under capital lease | 800,000 | ' | ' | ' | 400,000 | ' | ' | ' | 800,000 | 400,000 | ' |
Customer lists | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite Lived Intangible Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross carrying amount | 195,651,000 | ' | ' | ' | 195,651,000 | ' | ' | ' | 195,651,000 | 195,651,000 | ' |
Less: accumulated amortization | -166,500,000 | ' | ' | ' | -157,579,000 | ' | ' | ' | -166,500,000 | -157,579,000 | ' |
Net carrying amount | 29,151,000 | ' | ' | ' | 38,072,000 | ' | ' | ' | 29,151,000 | 38,072,000 | ' |
Amortization of intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | 8,900,000 | 22,100,000 | 21,800,000 |
Expected amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 8,921,000 | ' | ' | ' | ' | ' | ' | ' | 8,921,000 | ' | ' |
2015 | 8,849,000 | ' | ' | ' | ' | ' | ' | ' | 8,849,000 | ' | ' |
2016 | 8,776,000 | ' | ' | ' | ' | ' | ' | ' | 8,776,000 | ' | ' |
2017 | 2,605,000 | ' | ' | ' | ' | ' | ' | ' | 2,605,000 | ' | ' |
Net carrying amount | $29,151,000 | ' | ' | ' | $38,072,000 | ' | ' | ' | $29,151,000 | $38,072,000 | ' |
Customer lists | Minimum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite Lived Intangible Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful life of assets | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' | ' |
Customer lists | Maximum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite Lived Intangible Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful life of assets | ' | ' | ' | ' | ' | ' | ' | ' | '13 years | ' | ' |
Customer lists | Weighted average | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite Lived Intangible Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful life of assets | ' | ' | ' | ' | ' | ' | ' | ' | '2 years 1 month 17 days | ' | ' |
BUSINESS_DESCRIPTION_SUMMARY_O8
BUSINESS DESCRIPTION & SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 6) (ETFL) | Dec. 31, 2013 |
Noncontrolling Interest | ' |
Ownership interest (as a percent) | 63.00% |
Eastex Telecom Investments, LLC | ' |
Noncontrolling Interest | ' |
Minority interest holding percentage | 37.00% |
EARNINGS_PER_SHARE_Details
EARNINGS PER SHARE (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Basic and Diluted Earnings Per Share Using Two-class Method: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from continuing operations | $3,216 | $10,330 | $9,560 | $6,858 | $2,778 | ($1,311) | $2,321 | $1,177 | $29,964 | $4,965 | $24,288 |
Less: net income attributable to noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | 330 | 531 | 572 |
Income attributable to common shareholders before allocation of earnings to participating securities | ' | ' | ' | ' | ' | ' | ' | ' | 29,634 | 4,434 | 23,716 |
Less: earnings allocated to participating securities | ' | ' | ' | ' | ' | ' | ' | ' | 466 | 351 | 429 |
Income from continuing operations attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 29,168 | 4,083 | 23,287 |
Net income from discontinued operations | ' | 1,425 | -272 | 24 | -553 | 467 | 585 | 707 | 1,177 | 1,206 | 2,694 |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | $30,345 | $5,289 | $25,981 |
Weighted-average number of common shares outstanding | ' | ' | ' | ' | ' | ' | ' | ' | 39,764,000 | 34,652,000 | 29,600,000 |
Basic and diluted earnings per common share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from continuing operations (in dollars per share) | $0.08 | $0.26 | $0.23 | $0.17 | $0.07 | ($0.03) | $0.07 | $0.03 | $0.73 | $0.12 | $0.79 |
Income from discontinued operations, net of tax (in dollars per share) | ' | $0.03 | ($0.01) | ' | ($0.02) | $0.01 | $0.02 | $0.03 | $0.03 | $0.03 | $0.09 |
Net income per basic and diluted common shares attributable to common shareholders (in dollars per share) | $0.08 | $0.29 | $0.22 | $0.17 | $0.05 | ($0.02) | $0.09 | $0.06 | $0.76 | $0.15 | $0.88 |
Common shares excluded from computation of potentially dilutive shares because of anti-dilutive effect | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | 300,000 | 300,000 |
ACQUISITION_AND_DISPOSITIONS_D
ACQUISITION AND DISPOSITIONS (Details) (USD $) | 12 Months Ended | 12 Months Ended | 0 Months Ended | 6 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 02, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Jul. 02, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Jul. 02, 2012 | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Customer lists | Customer lists | Customer lists | SureWest | SureWest | SureWest | SureWest | SureWest | SureWest | SureWest | SureWest | SureWest | SureWest | SureWest | |||
Customer lists | Customer lists | Customer lists | Tradenames | Tradenames | Purchase Price Allocation Adjustments | Minimum | Maximum | |||||||||
Customer lists | Customer lists | |||||||||||||||
Agreement and Plan of Merger with SureWest Communications | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of outstanding shares acquired | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash consideration per share (in dollars per share) | ' | ' | ' | ' | ' | $23 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate price of acquisition | ' | ' | ' | ' | ' | $550,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash paid and debt assumed | ' | ' | ' | ' | ' | 402,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued under acquisition | 148,400,000 | ' | ' | ' | ' | 9,965,983 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock price (in dollars per share) | ' | ' | ' | ' | ' | $14.89 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Value of common stock issued | ' | ' | ' | ' | ' | 148,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | 133,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | ' | 2,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition related costs | ' | ' | ' | ' | ' | ' | 9,500,000 | 9,500,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Final purchase price allocation | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' | ' | 47,073,000 | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' |
Property, plant and equipment | ' | ' | ' | ' | ' | 591,818,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 603,446,000 | 603,446,000 | ' | ' | ' | 84,016,000 | ' | ' | ' | ' | ' | ' | ' | 1,500,000 | ' | ' |
Other intangible assets | ' | ' | ' | ' | ' | 3,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other long-term assets | ' | ' | ' | ' | ' | 4,861,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total assets acquired | ' | ' | ' | ' | ' | 731,368,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | ' | ' | 53,566,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Pension and other post-retirement obligations | ' | ' | ' | ' | ' | 55,916,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred income taxes | ' | ' | ' | ' | ' | 66,976,000 | ' | ' | ' | ' | ' | ' | ' | 1,300,000 | ' | ' |
Other long-term liabilities | ' | ' | ' | ' | ' | 4,114,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total liabilities assumed | ' | ' | ' | ' | ' | 180,572,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net assets acquired | ' | ' | ' | ' | ' | 550,796,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash acquired | ' | ' | ' | ' | ' | 17,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trade receivables, fair value | ' | ' | ' | ' | ' | 21,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trade receivables, gross value | ' | ' | ' | ' | ' | 23,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Customer lists, estimated fair values | ' | ' | ' | ' | ' | ' | ' | ' | 2,700,000 | ' | ' | ' | ' | ' | ' | ' |
Tradenames, estimated fair values | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 900,000 | ' | ' | ' | ' |
Estimated useful life of customer list | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | '3 years | '5 years |
Amortization expense relating to the customer lists | ' | ' | 8,900,000 | 22,100,000 | 21,800,000 | ' | ' | ' | ' | 600,000 | 300,000 | ' | 500,000 | ' | ' | ' |
Unaudited Pro Forma Results | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating revenues | ' | ' | ' | ' | ' | ' | ' | 605,779,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Income from operations | ' | ' | ' | ' | ' | ' | ' | 69,881,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Income from continuing operations | ' | ' | ' | ' | ' | ' | ' | 9,259,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Discontinued operations, net of tax | ' | ' | ' | ' | ' | ' | ' | 1,206,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | ' | ' | 10,465,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Less: income attributable to noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | 531,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to common stockholders | ' | ' | ' | ' | ' | ' | ' | $9,934,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Net income per common share - basic and diluted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from continuing operations (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $0.27 | ' | ' | ' | ' | ' | ' | ' | ' |
Discontinued operations, net of tax (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $0.03 | ' | ' | ' | ' | ' | ' | ' | ' |
Net income per basic and diluted common share attributable to common shareholders (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $0.30 | ' | ' | ' | ' | ' | ' | ' | ' |
ACQUISITION_AND_DISPOSITIONS_D1
ACQUISITION AND DISPOSITIONS (Details 2) (USD $) | 1 Months Ended | 12 Months Ended | |||
Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 13, 2013 | |
ACQUISITION AND DISPOSITIONS | ' | ' | ' | ' | ' |
Total purchase price for the sale of the assets and contractual rights related to prison services | $2,500,000 | ' | ' | ' | $2,500,000 |
Assets of discontinued operations | ' | ' | ' | ' | ' |
Accounts receivable, net | ' | ' | 625,000 | ' | ' |
Property, plant and equipment, net | ' | ' | 564,000 | ' | ' |
Total assets | ' | ' | 1,189,000 | ' | ' |
Liabilities of discontinued operations | ' | ' | ' | ' | ' |
Accounts payable | ' | ' | 13,000 | ' | ' |
Advance billings and customer deposits | ' | ' | 938,000 | ' | ' |
Accrued expense | ' | ' | 3,258,000 | ' | ' |
Total liabilities | ' | ' | 4,209,000 | ' | ' |
Summary of the financial information for the prison services operations | ' | ' | ' | ' | ' |
Operating revenues | ' | 5,622,000 | 25,580,000 | 25,260,000 | ' |
Operating expenses including depreciation and amortization | ' | 5,883,000 | 23,599,000 | 21,534,000 | ' |
Income (Loss) from operations | ' | -261,000 | 1,981,000 | 3,726,000 | ' |
Other income (expense) | ' | ' | ' | 672,000 | ' |
Income tax expense (benefit) | ' | -105,000 | 775,000 | 1,704,000 | ' |
Income (loss) from discontinued operations | ' | -156,000 | 1,206,000 | 2,694,000 | ' |
Gain on sale of discontinued operations, net of tax | 1,300,000 | 1,333,000 | ' | ' | ' |
Tax portion on gain on sale of discontinued operations | ' | $887,000 | ' | ' | ' |
INVESTMENTS_Details
INVESTMENTS (Details) (USD $) | 12 Months Ended | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Nov. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
item | GTE Mobilnet of South Texas Limited Partnership | GTE Mobilnet of South Texas Limited Partnership | Pittsburgh SMSA Limited Partnership | Pittsburgh SMSA Limited Partnership | CoBank, ACB Stock | CoBank, ACB Stock | Other | Other | GTE Mobilnet of Texas RSA #17 Limited Partnership | GTE Mobilnet of Texas RSA #17 Limited Partnership | GTE Mobilnet of Texas RSA #17 Limited Partnership | Pennsylvania RSA 6(I) Limited Partnership | Pennsylvania RSA 6(I) Limited Partnership | Pennsylvania RSA 6(II) Limited Partnership | Pennsylvania RSA 6(II) Limited Partnership | CVIN, LLC | CVIN, LLC | |||
Investments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage of cost method investee | ' | ' | ' | 2.34% | ' | 3.60% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash distributions received from partnerships treated as cost method investees | $16,900,000 | $14,100,000 | $11,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage of equity method investee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.51% | 17.02% | 16.67% | ' | 23.67% | ' | 13.46% | ' |
Cash distributions received from partnerships treated as equity method investees | 17,900,000 | 15,000,000 | 17,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase of additional ownership interest | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,700,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of entity's investments which is accounted for using equity method | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Carrying value of investments in excess of underlying equity | 33,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Investments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash surrender value of life insurance policies | 2,183,000 | 2,045,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost method investments: | ' | ' | ' | 21,450,000 | 21,450,000 | 22,950,000 | 22,950,000 | 5,112,000 | 5,023,000 | 200,000 | 430,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity method investments: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,695,000 | 27,467,000 | ' | 7,696,000 | 7,286,000 | 24,105,000 | 23,338,000 | 1,936,000 | 1,533,000 |
Total | 113,099,000 | 109,750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summary of unaudited summarized income statement information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | 321,555,000 | 299,389,000 | 305,965,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from operations | 98,962,000 | 83,577,000 | 84,803,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income before taxes | 99,024,000 | 83,633,000 | 84,844,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 99,024,000 | 83,283,000 | 84,483,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summary of unaudited summarized balance sheet information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets | 54,837,000 | 49,982,000 | 44,739,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-current assets | 87,968,000 | 79,529,000 | 79,432,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | 15,221,000 | 15,417,000 | 14,523,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-current liabilities | 1,786,000 | 1,351,000 | 1,096,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Partnership equity | $125,799,000 | $112,734,000 | $108,552,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value Measurements | ' | ' |
Current interest rate swap liabilities | ($660) | ($3,164) |
Recurring | Fair Value | ' | ' |
Fair Value Measurements | ' | ' |
Current interest rate swap liabilities | -660 | -3,164 |
Long-term interest rate swap liabilities | -1,959 | -3,919 |
Total | -2,619 | -7,083 |
Recurring | Significant Other Observable Inputs (Level 2) | ' | ' |
Fair Value Measurements | ' | ' |
Current interest rate swap liabilities | -660 | -3,164 |
Long-term interest rate swap liabilities | -1,959 | -3,919 |
Total | ($2,619) | ($7,083) |
FAIR_VALUE_MEASUREMENTS_Detail1
FAIR VALUE MEASUREMENTS (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Carrying Value | ' | ' |
Fair Value Measurements | ' | ' |
Investments, equity basis | $61,204 | $57,852 |
Investments, at cost | 49,712 | 49,853 |
Long-term debt, excluding capital leases | 1,216,764 | 1,213,000 |
Fair Value | ' | ' |
Fair Value Measurements | ' | ' |
Long-term debt, excluding capital leases | $1,261,508 | $1,231,355 |
LONGTERM_DEBT_Details
LONG-TERM DEBT (Details) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | 1 Months Ended | 0 Months Ended | 12 Months Ended | 19 Months Ended | |||||||||||||||
Feb. 01, 2014 | Nov. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Feb. 29, 2012 | 30-May-12 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | |
item | Minimum | Maximum | Senior Secured Credit Facility | Senior Secured Credit Facility | Term loan 2 | Term loan 3 | Term loan 3 | Term loan 4 | Term loan 4 | Term loan 4 | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior secured credit facility - revolving loan | Senior Unsecured Bridge Loan Facility | Senior Notes due 2020 | Senior Notes due 2020 | Senior Notes due 2020 | Senior Notes due 2020 | Senior Notes due 2020 | Capital leases | Capital leases | |||||
Weighted average | Weighted average | LIBOR | LIBOR | LIBOR | LIBOR | Alternate base rate | Alternate base rate | Alternate base rate | SureWest | Maximum | |||||||||||||||||||||
Minimum | Maximum | Weighted average | Minimum | Maximum | Weighted average | ||||||||||||||||||||||||||
Forecast | Forecast | ||||||||||||||||||||||||||||||
Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total long-term debt and capital leases | ' | ' | $1,221,885,000 | $1,217,844,000 | ' | ' | ' | ' | ' | $404,961,000 | $509,912,000 | $509,912,000 | $905,463,000 | $905,463,000 | ' | $13,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $298,301,000 | $298,301,000 | $298,127,000 | ' | $5,121,000 | $4,844,000 |
Less: current portion of long-term debt and capital leases | ' | ' | -9,751,000 | -9,596,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total long-term debt | ' | ' | 1,212,134,000 | 1,208,248,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity of credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75,000,000 | ' | ' | ' | ' | ' | ' | ' | 350,000,000 | ' | ' | ' | ' | ' | ' | ' |
Aggregate principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 910,000,000 | 910,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000,000 | ' | ' | ' | ' | ' | ' |
Amounts outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Margin (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.25% | ' | ' | 2.50% | 3.25% | 3.00% | 1.50% | 2.25% | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Reference rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | 'LIBOR | 'LIBOR | 'LIBOR | 'Alternative base rate | 'Alternative base rate | 'Alternative base rate | ' | ' | ' | ' | ' | ' | ' | ' |
Variable rate basis, floor (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Quarterly principal payments required | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowings or letters of credit outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | 4.23% | 4.79% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '4 months | ' | ' | ' | ' | ' | ' | ' |
Financing fees capitalized | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,200,000 | ' | 6,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,200,000 | ' | ' | ' | ' | ' | ' | ' |
Loss on extinguishment of debt | ' | ' | -7,657,000 | -4,455,000 | ' | ' | ' | ' | ' | ' | ' | 4,500,000 | ' | 7,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Financing fees recognized as expense | ' | ' | 776,000 | 20,800,000 | 2,649,000 | ' | ' | ' | 3,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend declared | ' | 15,500,000 | 62,121,000 | 57,992,000 | 46,348,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend paid | 15,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 108,500,000 | ' | ' | ' | ' |
Remaining consolidated cash available for dividends and other restricted payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 156,600,000 | 156,600,000 | ' | ' | ' | ' |
Dividends available for distribution | ' | ' | 202,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Leverage ratio | ' | ' | 4.26 | ' | ' | ' | 5.1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Leverage ratio for an event of default | ' | ' | ' | ' | ' | ' | 5.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest coverage ratio | ' | ' | 3.41 | ' | ' | 2.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of increase in available cash used in repayment of debt during dividend suspension period | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.88% | ' | ' | ' | ' | ' | ' |
Issue price as a percentage of principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 99.35% | ' | ' | ' | ' | ' | ' |
Yield to maturity (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11.00% | ' | ' | ' | ' | ' | ' |
Debt issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 287,300,000 | ' | ' | ' | ' | ' |
Leverage ratio covenant for dividend and other restricted payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.25 | ' | ' |
Net leverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.2 | 4.2 | ' | ' | ' | ' |
Number of times to be applied to fixed charges for calculating the deduction from cumulative consolidated net cash | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.75 | 1.75 | ' | ' | ' | ' |
Cumulative consolidated cash available to pay dividends and other restricted payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 265,100,000 | 265,100,000 | ' | ' | ' | ' |
Dividends and other restricted payments available for distribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | 50,000,000 | ' | ' | ' | ' |
Aggregate maturities of our long-term debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | ' | ' | 9,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | ' | ' | 22,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | ' | ' | 1,164,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total maturities | ' | ' | 1,223,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unamortized discount | ' | ' | -6,236,000 | ' | ' | ' | ' | ' | ' | ' | -5,088,000 | -5,088,000 | -4,537,000 | -4,537,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,699,000 | -1,699,000 | -1,873,000 | ' | ' | ' |
Long-term debt excluding capital leases | ' | ' | $1,216,764,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of capital leases | ' | ' | 7 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
DERIVATIVE_FINANCIAL_INSTRUMEN2
DERIVATIVE FINANCIAL INSTRUMENTS (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 23, 2013 | Dec. 04, 2012 | |
Derivatives | ' | ' | ' | ' |
Fair Value, Current portion of long-term liabilities | ($660,000) | ($3,164,000) | ' | ' |
Number of U.S. and European banks which are counterparties | 4 | ' | ' | ' |
Number of swap agreements that provide for the entity or the counterparties to post collateral | 0 | ' | ' | ' |
De-designated Hedges | Fixed to 1-month floating LIBOR (with floor) | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | '1-month floating LIBOR | ' | ' | ' |
Notional amount | 50,000,000 | ' | ' | ' |
De-designated Hedges | Fixed to 3-month floating LIBOR, one | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | ' | '3-month floating LIBOR | ' | ' |
Notional amount | ' | 130,000,000 | ' | ' |
Fair Value, Current portion of long-term liabilities | ' | -1,300,000 | ' | ' |
De-designated Hedges | 3-month floating LIBOR minus spread to 1-month floating LIBOR, one | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | ' | '1-month floating LIBOR | ' | ' |
Reference rate for paying interest | ' | '3-month floating LIBOR minus spread | ' | ' |
Notional amount | ' | 130,000,000 | ' | ' |
Fair Value, Current portion of long-term liabilities | ' | -16,000 | ' | ' |
De-designated Hedges | Fixed to 1-month floating LIBOR, one | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | '1-month floating LIBOR | '1-month floating LIBOR | ' | ' |
Notional amount | 175,000,000 | 200,000,000 | ' | ' |
Fair Value, Current portion of long-term liabilities | -1,897,000 | -779,000 | ' | ' |
De-designated Hedges | Fixed to 1-month floating LIBOR, two | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | '1-month floating LIBOR | ' | ' | ' |
Notional amount | 100,000,000 | ' | ' | ' |
Fair Value, Current portion of long-term liabilities | -660,000 | ' | ' | ' |
De-designated Hedges | Interest rate swaps | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Notional amount | ' | ' | 325,000,000 | 660,000,000 |
Notional amount of derivatives expired | ' | 200,000,000 | ' | ' |
Gain recognized as a reduction to interest expense | 2,200,000 | 2,800,000 | ' | ' |
Cash flow hedges | Fixed to 1-month floating LIBOR, one | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | ' | '1-month floating LIBOR | ' | ' |
Notional amount | ' | 200,000,000 | ' | ' |
Fair Value, Other long-term liabilities | ' | -2,758,000 | ' | ' |
Cash flow hedges | Fixed to 1-month floating LIBOR, two | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | ' | '1-month floating LIBOR | ' | ' |
Notional amount | ' | 100,000,000 | ' | ' |
Fair Value, Current portion of long-term liabilities | ' | -1,069,000 | ' | ' |
Cash flow hedges | Forward starting fixed to 1-month floating LIBOR | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Reference rate for receiving interest | ' | '1-month floating LIBOR | ' | ' |
Notional amount | ' | 75,000,000 | ' | ' |
Fair Value, Other long-term liabilities | ' | -1,161,000 | ' | ' |
Cash flow hedges | Interest rate swaps | ' | ' | ' | ' |
Derivatives | ' | ' | ' | ' |
Total Fair Value | ($2,619,000) | ($7,083,000) | ' | ' |
DERIVATIVE_FINANCIAL_INSTRUMEN3
DERIVATIVE FINANCIAL INSTRUMENTS (Details 2) (Interest rate swaps, USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Loss on cash flow hedges | ' | ' | ' |
Derivatives | ' | ' | ' |
Deferred losses included in AOCI (pretax) | $2,600,000 | $7,900,000 | ' |
Cash flow hedges | ' | ' | ' |
Derivatives | ' | ' | ' |
Loss recognized in AOCI, pretax | -614,000 | -5,631,000 | -7,617,000 |
Loss reclassified from AOCI to interest expense | -5,875,000 | -13,664,000 | -19,649,000 |
Gain arising from ineffectiveness reducing interest expense | ' | 47,000 | 93,000 |
Losses included in AOCI to be recognized in the next 12 months | $2,000,000 | ' | ' |
EQUITY_Details
EQUITY (Details) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock-based compensation plans | ' | ' | ' |
Shares of common stock authorized for issuance | 1,650,000 | ' | ' |
Vesting period | '4 years | ' | ' |
Number of shares | ' | ' | ' |
Total fair value of the awards vested | $3 | $2.40 | $1.60 |
Price | ' | ' | ' |
Pretax stock-based compensation expense | 3 | 2.3 | 2.1 |
Income tax benefits related to stock-based compensation | 1.1 | 0.4 | 0.8 |
Maximum | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Shares that may be granted in the form of stock options or stock appreciation rights to any eligible employee or director in any calendar year | 300,000 | ' | ' |
Payout opportunity as a percentage of the target | 120.00% | ' | ' |
Minimum | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Payout opportunity as a percentage of the target | 0.00% | ' | ' |
Plan | ' | ' | ' |
Number of shares | ' | ' | ' |
Shares granted | 235,020 | 83,272 | 177,817 |
Restricted stock | ' | ' | ' |
Stock-based compensation plans | ' | ' | ' |
Vesting period | '4 years | ' | ' |
Number of shares | ' | ' | ' |
Non-vested shares outstanding at the beginning of the period | 64,318 | ' | ' |
Shares granted | 168,516 | ' | ' |
Shares vested | -107,833 | ' | ' |
Shares forfeited, cancelled or retired | -1,500 | ' | ' |
Non-vested shares outstanding at the end of the period | 123,501 | 64,318 | ' |
Price | ' | ' | ' |
Non-vested shares outstanding at the beginning of the period (in dollars per share) | $18.33 | ' | ' |
Shares granted (in dollars per share) | $17.13 | ' | ' |
Shares vested (in dollars per share) | $17.61 | ' | ' |
Shares forfeited, cancelled or retired (in dollars per share) | $17.13 | ' | ' |
Non-vested shares outstanding at the end of the period (in dollars per share) | $17.32 | $18.33 | ' |
Pretax stock-based compensation expense | 1.8 | 1.3 | 1.3 |
Unrecognized share-based compensation | ' | ' | ' |
Unrecognized compensation costs | 3.5 | ' | ' |
Weighted-average period of recognition | '9 months 18 days | ' | ' |
Restricted stock | Plan | ' | ' | ' |
Number of shares | ' | ' | ' |
Shares granted | 168,516 | 14,732 | 127,377 |
Price | ' | ' | ' |
Shares granted (in dollars per share) | $17.13 | $19.30 | $17.92 |
Performance shares | ' | ' | ' |
Number of shares | ' | ' | ' |
Non-vested shares outstanding at the beginning of the period | 58,221 | ' | ' |
Shares granted | 66,504 | ' | ' |
Shares vested | -60,459 | ' | ' |
Non-vested shares outstanding at the end of the period | 64,266 | 58,221 | ' |
Price | ' | ' | ' |
Non-vested shares outstanding at the beginning of the period (in dollars per share) | $18.85 | ' | ' |
Shares granted (in dollars per share) | $17.13 | ' | ' |
Shares vested (in dollars per share) | $17.90 | ' | ' |
Non-vested shares outstanding at the end of the period (in dollars per share) | $17.96 | $18.85 | ' |
Pretax stock-based compensation expense | 1.2 | 1 | 0.8 |
Unrecognized share-based compensation | ' | ' | ' |
Unrecognized compensation costs | $3.50 | ' | ' |
Weighted-average period of recognition | '9 months 18 days | ' | ' |
Performance shares | Plan | ' | ' | ' |
Number of shares | ' | ' | ' |
Shares granted | 66,504 | 68,540 | 50,440 |
Price | ' | ' | ' |
Shares granted (in dollars per share) | $17.13 | $19.30 | $17.92 |
EQUITY_Details_2
EQUITY (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Changes in accumulated other comprehensive loss, net of tax, by component | ' | ' | ' |
Balance at the beginning of the period | ($45,784) | ' | ' |
Other comprehensive income before reclassifications | 39,000 | ' | ' |
Amounts reclassified from accumulated other comprehensive income | 5,784 | ' | ' |
Net current period other comprehensive income | 44,784 | -7,951 | -6,362 |
Balance at the end of the period | -1,000 | -45,784 | ' |
Pension and Post-Retirement Obligations | ' | ' | ' |
Changes in accumulated other comprehensive loss, net of tax, by component | ' | ' | ' |
Balance at the beginning of the period | -40,581 | ' | ' |
Other comprehensive income before reclassifications | 39,381 | ' | ' |
Amounts reclassified from accumulated other comprehensive income | 1,843 | ' | ' |
Net current period other comprehensive income | 41,224 | ' | ' |
Balance at the end of the period | 643 | ' | ' |
Derivative Instruments | ' | ' | ' |
Changes in accumulated other comprehensive loss, net of tax, by component | ' | ' | ' |
Balance at the beginning of the period | -5,203 | ' | ' |
Other comprehensive income before reclassifications | -381 | ' | ' |
Amounts reclassified from accumulated other comprehensive income | 3,941 | ' | ' |
Net current period other comprehensive income | 3,560 | ' | ' |
Balance at the end of the period | ($1,643) | ' | ' |
EQUITY_Details_3
EQUITY (Details 3) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
EQUITY | ' | ' | ' |
Income from continuing operations before income taxes | $47,476 | $5,626 | $37,429 |
Interest expense | -85,767 | -72,604 | -49,391 |
Tax benefit | -17,512 | -661 | -13,141 |
Net income | 31,141 | 6,171 | 26,982 |
Amortization of pension and post-retirement items | Amount Reclassified from AOCI | ' | ' | ' |
EQUITY | ' | ' | ' |
Prior service credit | -637 | ' | ' |
Actuarial loss | 3,652 | ' | ' |
Income from continuing operations before income taxes | 3,015 | ' | ' |
Tax benefit | -1,172 | ' | ' |
Net income | 1,843 | ' | ' |
Loss on cash flow hedges | Amount Reclassified from AOCI | ' | ' | ' |
EQUITY | ' | ' | ' |
Interest expense | 5,875 | ' | ' |
Tax benefit | -1,934 | ' | ' |
Net income | $3,941 | ' | ' |
PENSION_PLANS_AND_OTHER_POSTRE2
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Amounts recognized in the consolidated balance sheets | ' | ' | ' |
Long-term liabilities | ($75,754,000) | ($156,710,000) | ' |
Defined Benefit Plans | ' | ' | ' |
Change in benefit obligation | ' | ' | ' |
Benefit obligation at the beginning of the year | 379,528,000 | 203,413,000 | ' |
Service costs | 743,000 | 1,184,000 | 1,277,000 |
Interest costs | 15,307,000 | 13,620,000 | 10,960,000 |
Actuarial loss (gain) | -34,315,000 | 32,274,000 | ' |
Benefits paid | -21,559,000 | -16,529,000 | ' |
Acquisition | ' | 146,688,000 | ' |
Plan change | -2,361,000 | -1,122,000 | ' |
Benefit obligation at the end of the year | 337,343,000 | 379,528,000 | 203,413,000 |
Change in plan assets | ' | ' | ' |
Fair value of plan assets at the beginning of the year | 262,778,000 | 142,736,000 | ' |
Employer contributions | 11,480,000 | 15,222,000 | ' |
Actual return on plan assets | 39,489,000 | 27,935,000 | ' |
Benefits paid | -21,559,000 | -16,529,000 | ' |
Acquisition | ' | 93,414,000 | ' |
Fair value of plan assets at the end of the year | 292,188,000 | 262,778,000 | 142,736,000 |
Funded status at year end | -45,155,000 | -116,750,000 | ' |
Amounts recognized in the consolidated balance sheets | ' | ' | ' |
Current liabilities | -254,000 | -254,000 | ' |
Long-term liabilities | -44,901,000 | -116,496,000 | ' |
Amounts recognized in accumulated other comprehensive income | ' | ' | ' |
Unamortized prior service credit | -4,426,000 | -2,523,000 | ' |
Unamortized net actuarial loss | 10,302,000 | 67,104,000 | ' |
Total | 5,876,000 | 64,581,000 | ' |
Components of net periodic pension costs | ' | ' | ' |
Service costs | 743,000 | 1,184,000 | 1,277,000 |
Interest costs | 15,307,000 | 13,620,000 | 10,960,000 |
Expected return on plan assets | -20,654,000 | -14,728,000 | -10,893,000 |
Amortization of: Net actuarial loss | 3,652,000 | 2,518,000 | 786,000 |
Amortization of: Prior service credit | -457,000 | -282,000 | -166,000 |
Net periodic pension (benefit) cost | -1,409,000 | 2,312,000 | 1,964,000 |
Changes in plan assets and benefit obligations recognized in other comprehensive income, before tax effects | ' | ' | ' |
Actuarial loss (gain), net | -53,149,000 | 19,066,000 | ' |
Recognized actuarial loss | -3,652,000 | -2,518,000 | ' |
Prior service credit | -2,361,000 | -1,122,000 | ' |
Recognized prior service credit | 457,000 | 282,000 | ' |
Total amount recognized in other comprehensive income, before tax effects | -58,705,000 | 15,708,000 | ' |
Amount to be amortized from accumulated other comprehensive income in net periodic benefit cost in the next fiscal year | ' | ' | ' |
Net loss | 200,000 | ' | ' |
Net prior service cost | -500,000 | ' | ' |
Weighted-average assumptions used to determine the projected benefit obligations and net periodic benefit cost | ' | ' | ' |
Discount rate - net periodic benefit cost (as a percent) | 4.20% | 5.00% | 5.86% |
Discount rate - benefit obligation (as a percent) | 4.97% | 4.20% | 5.35% |
Expected long-term rate of return on plan assets (as a percent) | 8.00% | 7.70% | 7.50% |
Rate of compensation/salary increase for net periodic benefit cost (as a percent) | 1.75% | 1.50% | 3.06% |
Supplemental Plans | ' | ' | ' |
Defined benefit plans | ' | ' | ' |
Number of persons eligible to become a new participant | 0 | ' | ' |
Number of non-qualified plans | 2 | ' | ' |
SureWest Plan | ' | ' | ' |
Defined benefit plans | ' | ' | ' |
Number of highest consecutive years for computing employee's average compensation | '5 years | ' | ' |
Number of persons eligible to become a new participant | 0 | ' | ' |
Period of credit service for computing employee's average compensation | '10 years | ' | ' |
Pension and SERP Plans | ' | ' | ' |
Defined benefit plans | ' | ' | ' |
Post-retirement Plan unfunded assets | $0 | ' | ' |
PENSION_PLANS_AND_OTHER_POSTRE3
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS (Details 2) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
item | ||
Other Non-qualified Deferred Compensation Agreements | ' | ' |
Minimum age at which payments under deferred compensation agreements may begin | '55 years | ' |
Payment related to deferred compensation agreements | $0.60 | $0.60 |
Net present value of the remaining obligations | 1.8 | 2.2 |
Number of life insurance policies | 34 | ' |
Proceeds from life insurance policies | 0.3 | 0.4 |
Excess of cash surrender value of remaining life insurance policies over notes payable | 2.2 | 2 |
Aggregate death benefit payment payable under the life insurance policies | $7.30 | $7.50 |
PENSION_PLANS_AND_OTHER_POSTRE4
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS (Details 3) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
item | |||
Amounts recognized in the consolidated balance sheets | ' | ' | ' |
Long-term liabilities | ($75,754,000) | ($156,710,000) | ' |
Post-retirement Benefit Obligations | ' | ' | ' |
Post-retirement benefit obligation | ' | ' | ' |
Post-retirement Plan unfunded assets | 0 | ' | ' |
Number of persons eligible to become a new participant | 0 | ' | ' |
Change in benefit obligation | ' | ' | ' |
Benefit obligation at the beginning of the year | 43,906,000 | 33,184,000 | ' |
Service costs | 925,000 | 811,000 | 749,000 |
Interest costs | 1,575,000 | 1,756,000 | 1,690,000 |
Plan participant contributions | 757,000 | 614,000 | ' |
Actuarial loss (gain) | -9,552,000 | 5,282,000 | ' |
Benefits paid | -3,966,000 | -4,011,000 | ' |
Amendments | 1,448,000 | ' | ' |
Acquisition | ' | 6,270,000 | ' |
Benefit obligation at the end of the year | 35,093,000 | 43,906,000 | 33,184,000 |
Change in plan assets | ' | ' | ' |
Fair value of plan assets at the beginning of the year | 3,410,000 | ' | ' |
Employer contributions | 2,772,000 | 3,189,000 | ' |
Plan participant contributions | 757,000 | 614,000 | ' |
Actual return on plan assets | 602,000 | 197,000 | ' |
Benefits paid | -3,966,000 | -4,011,000 | ' |
Acquisition | ' | 3,421,000 | ' |
Fair value of plan assets at the end of the year | 3,575,000 | 3,410,000 | ' |
Funded status at year end | -31,518,000 | -40,496,000 | ' |
Amounts recognized in the consolidated balance sheets | ' | ' | ' |
Current liabilities | -2,429,000 | -2,467,000 | ' |
Long-term liabilities | -29,089,000 | -38,029,000 | ' |
Amounts recognized in accumulated other comprehensive income | ' | ' | ' |
Unamortized prior service credit | 183,000 | -1,446,000 | ' |
Unamortized net actuarial loss (gain) | -7,868,000 | 2,055,000 | ' |
Total | -7,685,000 | 609,000 | ' |
Components of net periodic pension costs | ' | ' | ' |
Service costs | 925,000 | 811,000 | 749,000 |
Interest costs | 1,575,000 | 1,756,000 | 1,690,000 |
Expected return on plan assets | -233,000 | -105,000 | ' |
Amortization of: Net actuarial loss | ' | ' | -212,000 |
Amortization of: Prior service credit | -180,000 | -189,000 | -189,000 |
Net periodic pension (benefit) cost | 2,087,000 | 2,273,000 | 2,038,000 |
Changes in plan assets and benefit obligations recognized in other comprehensive income, before tax effects | ' | ' | ' |
Actuarial loss (gain), net | -9,922,000 | 5,191,000 | ' |
Prior service credit | 1,448,000 | ' | ' |
Recognized prior service credit | 180,000 | 189,000 | ' |
Total amount recognized in other comprehensive income, before tax effects | -8,294,000 | 5,380,000 | ' |
Estimated net prior service credit that will be amortized from accumulated other comprehensive loss in net periodic postretirement cost | -500,000 | -200,000 | ' |
Weighted-average assumptions used to determine the projected benefit obligations and net periodic benefit cost | ' | ' | ' |
Discount rate - net periodic benefit cost (as a percent) | 4.00% | 5.00% | 5.58% |
Discount rate - benefit obligation (as a percent) | 4.40% | 3.90% | 5.22% |
Change in the assumed healthcare cost trend rate | ' | ' | ' |
Health care trend rate assumed for the next fiscal year (as a percent) | 7.50% | ' | ' |
Ultimate health care cost trend rate (as a percent) | 5.00% | ' | ' |
Effect of one percent change in the assumed healthcare cost trend rate | ' | ' | ' |
Effect of one percent increase on total of service and interest cost | 277,000 | ' | ' |
Effect of one percent decrease on total of service and interest cost | -230,000 | ' | ' |
Effect of one percent increase on postretirement benefit obligation | 2,063,000 | ' | ' |
Effect of one percent decrease on postretirement benefit obligation | ($1,852,000) | ' | ' |
PENSION_PLANS_AND_OTHER_POSTRE5
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS (Details 4) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Minimum | ' | ' | ' |
Plan Assets | ' | ' | ' |
Long-term investment horizon | '5 years | ' | ' |
Minimum | Equity mutual fund | ' | ' | ' |
Plan Assets | ' | ' | ' |
Target allocation (as a percent) | 50.00% | ' | ' |
Maximum | ' | ' | ' |
Plan Assets | ' | ' | ' |
Long-term investment horizon | '15 years | ' | ' |
Maximum | Equity mutual fund | ' | ' | ' |
Plan Assets | ' | ' | ' |
Target allocation (as a percent) | 60.00% | ' | ' |
Defined Benefit Plans | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | $292,188,000 | $262,778,000 | $142,736,000 |
Benefit payments payable | -337,343,000 | -379,528,000 | -203,413,000 |
Funded status at year end | -45,155,000 | -116,750,000 | ' |
Expected contribution in the next fiscal year | 12,100,000 | ' | ' |
Benefit payments expected to be paid | ' | ' | ' |
2014 | 22,413,000 | ' | ' |
2015 | 22,827,000 | ' | ' |
2016 | 23,164,000 | ' | ' |
2017 | 23,274,000 | ' | ' |
2018 | 23,245,000 | ' | ' |
2019-2023 | 116,421,000 | ' | ' |
Defined Benefit Plans | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 193,908,000 | 184,493,000 | ' |
Defined Benefit Plans | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 98,280,000 | 78,285,000 | ' |
Defined Benefit Plans | Short-term investments | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 4,708,000 | 4,262,000 | ' |
Defined Benefit Plans | Short-term investments | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 2,835,000 | 1,036,000 | ' |
Defined Benefit Plans | Short-term investments | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 1,873,000 | 3,226,000 | ' |
Defined Benefit Plans | U.S. common stocks | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 38,463,000 | 36,620,000 | ' |
Defined Benefit Plans | U.S. common stocks | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 38,463,000 | 36,620,000 | ' |
Defined Benefit Plans | International stocks | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 10,198,000 | 9,589,000 | ' |
Defined Benefit Plans | International stocks | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 10,198,000 | 9,589,000 | ' |
Defined Benefit Plans | U.S. small cap funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 15,181,000 | 17,110,000 | ' |
Defined Benefit Plans | U.S. small cap funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 15,181,000 | 17,110,000 | ' |
Defined Benefit Plans | US mid cap funds Member | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 9,215,000 | 7,477,000 | ' |
Defined Benefit Plans | US mid cap funds Member | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 9,215,000 | 7,477,000 | ' |
Defined Benefit Plans | U.S. large cap funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 34,535,000 | 35,130,000 | ' |
Defined Benefit Plans | U.S. large cap funds | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 11,101,000 | 12,932,000 | ' |
Defined Benefit Plans | U.S. large cap funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 23,434,000 | 22,198,000 | ' |
Defined Benefit Plans | Emerging markets funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 20,225,000 | 7,807,000 | ' |
Defined Benefit Plans | Emerging markets funds | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 12,855,000 | 7,807,000 | ' |
Defined Benefit Plans | Emerging markets funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 7,370,000 | ' | ' |
Defined Benefit Plans | International funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 60,416,000 | 43,100,000 | ' |
Defined Benefit Plans | International funds | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 44,132,000 | 34,602,000 | ' |
Defined Benefit Plans | International funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 16,284,000 | 8,498,000 | ' |
Defined Benefit Plans | Common collective trust | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 17,398,000 | 7,346,000 | ' |
Defined Benefit Plans | Common collective trust | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 17,398,000 | 7,346,000 | ' |
Defined Benefit Plans | U.S. treasury and government agency securities | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 19,012,000 | 22,937,000 | ' |
Defined Benefit Plans | U.S. treasury and government agency securities | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 19,012,000 | 22,937,000 | ' |
Defined Benefit Plans | Corporate and municipal bonds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 8,624,000 | 9,238,000 | ' |
Defined Benefit Plans | Corporate and municipal bonds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 8,624,000 | 9,238,000 | ' |
Defined Benefit Plans | Mortgage/asset-backed securities | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 8,116,000 | 10,669,000 | ' |
Defined Benefit Plans | Mortgage/asset-backed securities | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 8,116,000 | 10,669,000 | ' |
Defined Benefit Plans | Fixed Income mutual funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 46,097,000 | 51,493,000 | ' |
Defined Benefit Plans | Fixed Income mutual funds | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 46,097,000 | 51,493,000 | ' |
Post-retirement Benefit Obligations | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 3,575,000 | 3,410,000 | ' |
Benefit payments payable | -35,093,000 | -43,906,000 | -33,184,000 |
Funded status at year end | -31,518,000 | -40,496,000 | ' |
Expected contribution in the next fiscal year | 2,500,000 | ' | ' |
Benefit payments expected to be paid | ' | ' | ' |
2014 | 3,495,000 | ' | ' |
2015 | 3,574,000 | ' | ' |
2016 | 3,615,000 | ' | ' |
2017 | 2,806,000 | ' | ' |
2018 | 2,820,000 | ' | ' |
2019-2023 | 12,867,000 | ' | ' |
Post-retirement Benefit Obligations | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 1,716,000 | 1,640,000 | ' |
Post-retirement Benefit Obligations | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 2,294,000 | 1,770,000 | ' |
Post-retirement Benefit Obligations | Short-term investments | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 89,000 | 30,000 | ' |
Post-retirement Benefit Obligations | Short-term investments | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 89,000 | 30,000 | ' |
Post-retirement Benefit Obligations | U.S. common stocks | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 592,000 | 545,000 | ' |
Post-retirement Benefit Obligations | U.S. common stocks | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 592,000 | 545,000 | ' |
Post-retirement Benefit Obligations | U.S. small cap funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 215,000 | 238,000 | ' |
Post-retirement Benefit Obligations | U.S. small cap funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 215,000 | 238,000 | ' |
Post-retirement Benefit Obligations | U.S. large cap funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 638,000 | 572,000 | ' |
Post-retirement Benefit Obligations | U.S. large cap funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 638,000 | 572,000 | ' |
Post-retirement Benefit Obligations | Emerging markets funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 263,000 | ' | ' |
Post-retirement Benefit Obligations | Emerging markets funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 263,000 | ' | ' |
Post-retirement Benefit Obligations | International funds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 938,000 | 576,000 | ' |
Post-retirement Benefit Obligations | International funds | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 357,000 | 289,000 | ' |
Post-retirement Benefit Obligations | International funds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 581,000 | 287,000 | ' |
Post-retirement Benefit Obligations | U.S. treasury and government agency securities | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 678,000 | 776,000 | ' |
Post-retirement Benefit Obligations | U.S. treasury and government agency securities | Quoted Prices In Active Markets for Identical Assets (Level 1) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 678,000 | 776,000 | ' |
Post-retirement Benefit Obligations | Corporate and municipal bonds | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 308,000 | 312,000 | ' |
Post-retirement Benefit Obligations | Corporate and municipal bonds | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 308,000 | 312,000 | ' |
Post-retirement Benefit Obligations | Mortgage/asset-backed securities | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | 289,000 | 361,000 | ' |
Post-retirement Benefit Obligations | Mortgage/asset-backed securities | Significant Observable Inputs (Level 2) | ' | ' | ' |
Plan Assets | ' | ' | ' |
Fair value of assets | $289,000 | $361,000 | ' |
PENSION_PLANS_AND_OTHER_POSTRE6
PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS (Details 5) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Defined Contribution Plans | ' | ' | ' |
Expense with respect to 401(k) plans | $5.20 | $3.90 | $2.50 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Current: | ' | ' | ' |
Federal | $1,381,000 | $340,000 | $4,118,000 |
State | 86,000 | 1,078,000 | 477,000 |
Total current expense (benefit) | 1,467,000 | 1,418,000 | 4,595,000 |
Deferred: | ' | ' | ' |
Federal | 15,929,000 | 1,998,000 | 8,209,000 |
State | 116,000 | -2,755,000 | 337,000 |
Total deferred expense (benefit) | 16,045,000 | -757,000 | 8,546,000 |
Total income tax expense | 17,512,000 | 661,000 | 13,141,000 |
Reconciliation of the provision for income taxes computed at federal statutory rates to the effective rates | ' | ' | ' |
Statutory federal income tax rate (as a percent) | 35.00% | 35.00% | 35.00% |
State income taxes, net of federal benefit (as a percent) | 1.70% | -12.80% | 0.50% |
Transaction costs (as a percent) | ' | 14.90% | ' |
Other permanent differences (as a percent) | ' | -1.10% | -0.90% |
Change in uncertain tax positions (as a percent) | -1.70% | ' | -0.70% |
Change in deferred tax rate (as a percent) | ' | -19.70% | 1.10% |
Provision to return | 1.30% | -4.20% | ' |
Other (as a percent) | 0.60% | -0.40% | 0.10% |
Total (as a percent) | 36.90% | 11.70% | 35.10% |
Current deferred tax assets: | ' | ' | ' |
Reserve for uncollectible accounts | 615,000 | 1,815,000 | ' |
Accrued vacation pay deducted when paid | 2,196,000 | 1,727,000 | ' |
Accrued expenses and deferred revenue | 5,149,000 | 5,458,000 | ' |
Total | 7,960,000 | 9,000,000 | ' |
Non-current deferred tax assets: | ' | ' | ' |
Net operating loss carryforwards | 18,809,000 | 32,506,000 | ' |
Pension and postretirement obligations | 28,072,000 | 60,252,000 | ' |
Stock-based compensation | 495,000 | 450,000 | ' |
Derivative instruments | 1,004,000 | 3,004,000 | ' |
Financing costs | 1,503,000 | 567,000 | ' |
Tax credit carryforwards | 3,143,000 | 2,437,000 | ' |
Other | ' | 305,000 | ' |
Total | 53,026,000 | 99,521,000 | ' |
Valuation allowance | -535,000 | -535,000 | ' |
Net non-current deferred tax assets | 52,491,000 | 98,986,000 | ' |
Non-current deferred tax liabilities: | ' | ' | ' |
Goodwill and other intangibles | -28,515,000 | -27,376,000 | ' |
Basis in investment | -38,000 | -120,000 | ' |
Partnership investments | -25,523,000 | -26,413,000 | ' |
Property, plant and equipment | -178,274,000 | -182,578,000 | ' |
Total | -232,350,000 | -236,487,000 | ' |
Net non-current deferred taxes | -179,859,000 | -137,501,000 | ' |
Net deferred income tax liabilities | -171,899,000 | -128,501,000 | ' |
State | ' | ' | ' |
Non-current deferred tax assets: | ' | ' | ' |
Net operating loss carryforwards | 2,900,000 | ' | ' |
Tax credit carryforwards | 2,700,000 | ' | ' |
Income taxes | ' | ' | ' |
Unrecognized tax benefits recognized due to expiration of state statute of limitations | 1,224,000 | ' | ' |
Decrease in tax expense due to expiration of state statute of limitations | $800,000 | ' | ' |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
Federal | Federal | State | ||||
ETFL | ||||||
Income taxes | ' | ' | ' | ' | ' | ' |
Net operating loss carryforwards | ' | ' | ' | $43,000,000 | $2,300,000 | $85,800,000 |
Deferred tax assets related to net operating loss carryforwards | 18,809,000 | 32,506,000 | ' | 15,000,000 | 800,000 | 2,900,000 |
Utilization of net operating loss carryforwards subject to Separate Return Limitation Year | ' | ' | ' | 1,500,000 | ' | ' |
Deferred tax assets related to utilization of net operating loss carryforwards subject to Separate Return Limitation Year | ' | ' | ' | 500,000 | ' | ' |
Tax credit carryforwards | ' | ' | ' | 500,000 | ' | 4,100,000 |
Deferred tax assets related to State tax credit carryforwards | ' | ' | ' | 500,000 | ' | ' |
Deferred tax assets related to State tax credit carryforwards | 3,143,000 | 2,437,000 | ' | ' | ' | 2,700,000 |
Reconciliation of the unrecognized tax benefits | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | 1,224,000 | 1,224,000 | ' | ' | ' |
Reduction for lapse of statute of limitations | ' | ' | ' | ' | ' | -1,224,000 |
Balance at the end of the period | ' | $1,224,000 | $1,224,000 | ' | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
item | |||
Commitments and Contingencies | ' | ' | ' |
2014 | $28,110,000 | ' | ' |
2015 | 17,757,000 | ' | ' |
2016 | 15,490,000 | ' | ' |
2017 | 11,243,000 | ' | ' |
2018 | 1,480,000 | ' | ' |
Thereafter | 3,155,000 | ' | ' |
Total | 77,235,000 | ' | ' |
Operating Leases | ' | ' | ' |
Rent expense | 2,300,000 | 2,900,000 | 2,100,000 |
Capital Leases | ' | ' | ' |
Number of capital leases | 7 | ' | ' |
Present value of the minimum remaining lease commitments | 5,100,000 | ' | ' |
Capital lease commitments due and payable within the next 12 months | 700,000 | ' | ' |
Imputed interest | 2,700,000 | ' | ' |
Carrying amount of capital lease obligations, net of imputed interest | 5,100,000 | ' | ' |
Operating lease agreements | ' | ' | ' |
Commitments and Contingencies | ' | ' | ' |
2014 | 1,272,000 | ' | ' |
2015 | 1,249,000 | ' | ' |
2016 | 1,054,000 | ' | ' |
2017 | 961,000 | ' | ' |
2018 | 960,000 | ' | ' |
Thereafter | 2,362,000 | ' | ' |
Total | 7,858,000 | ' | ' |
Capital lease agreements | ' | ' | ' |
Commitments and Contingencies | ' | ' | ' |
2014 | 2,133,000 | ' | ' |
2015 | 1,712,000 | ' | ' |
2016 | 563,000 | ' | ' |
2017 | 392,000 | ' | ' |
2018 | 287,000 | ' | ' |
Thereafter | 793,000 | ' | ' |
Total | 5,880,000 | ' | ' |
Capital expenditures | ' | ' | ' |
Commitments and Contingencies | ' | ' | ' |
2014 | 8,384,000 | ' | ' |
Total | 8,384,000 | ' | ' |
Service and support agreements | ' | ' | ' |
Commitments and Contingencies | ' | ' | ' |
2014 | 7,221,000 | ' | ' |
2015 | 5,796,000 | ' | ' |
2016 | 4,873,000 | ' | ' |
2017 | 890,000 | ' | ' |
2018 | 233,000 | ' | ' |
Total | 19,013,000 | ' | ' |
Transport and data connectivity | ' | ' | ' |
Commitments and Contingencies | ' | ' | ' |
2014 | 9,100,000 | ' | ' |
2015 | 9,000,000 | ' | ' |
2016 | 9,000,000 | ' | ' |
2017 | 9,000,000 | ' | ' |
Total | $36,100,000 | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details 2) (USD $) | 1 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Jan. 18, 2012 | Apr. 30, 2008 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Mar. 31, 2013 | Dec. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2013 |
item | Salsgiver Inc. | Salsgiver Inc. | Salsgiver Inc. | Salsgiver Inc. | Assessment by Commonwealth of Pennsylvania Department of Revenue | Assessment by Commonwealth of Pennsylvania Department of Revenue | Assessment by Commonwealth of Pennsylvania Department of Revenue | Assessment by Commonwealth of Pennsylvania Department of Revenue | ||
item | item | Consolidated Communications Enterprise Services Inc. (CCES) | Consolidated Communications of Pennsylvania Company LLC (CCPA) | |||||||
Litigation and Contingencies | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Original amount of sustained losses claimed by plaintiff | ' | ' | $125 | ' | ' | ' | ' | ' | ' | ' |
Amount agreed to be paid in cash as per agreement | ' | ' | ' | ' | 0.9 | ' | ' | ' | ' | ' |
Credits granted as per agreement | ' | ' | ' | ' | 0.3 | ' | ' | ' | ' | ' |
Term of credits utilization for make ready work performed | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' |
Settlement amount previously accrued | ' | ' | ' | ' | ' | 0.4 | ' | ' | ' | ' |
Additional accrual per agreement | ' | ' | ' | 0.9 | ' | ' | ' | ' | ' | ' |
Number of subsidiaries that received assessment notice | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Total additional tax liability calculated by the auditors for calendar years 2008, 2009, and 2010 | ' | ' | ' | ' | ' | ' | ' | ' | 1.9 | 2 |
Number of cases appealed | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' |
Number of core issues appealed | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' |
Reversal of previously recognized revenues | $3 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | 31-May-12 |
In Millions, unless otherwise specified | item | LATEL | LATEL | LATEL | Agracel | Richard A. Lumpkin | Richard A. Lumpkin | Richard A. Lumpkin | Richard A. Lumpkin | Related parties | Related parties | Related parties |
building | LATEL | LATEL | LATEL | Agracel | Agracel | |||||||
item | ||||||||||||
lease | ||||||||||||
Related party transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of capital leases | 7 | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of beneficial ownership | ' | ' | ' | ' | ' | 70.70% | 70.70% | 41.30% | 41.30% | ' | ' | ' |
Ownership percentage | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' |
Number of buildings leased under capital leases | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of options to extend term of capital lease | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Extended period of capital leases | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Rental payments to be made over the terms of capital leases | ' | $7.90 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital leases, carrying value | 5.1 | 3.6 | 3.8 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense related to capital leases | ' | 0.5 | 0.5 | 0.5 | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense related to capitalized leases | ' | 0.4 | 0.4 | 0.1 | ' | ' | ' | ' | ' | ' | ' | ' |
Notes payable from related parties | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.8 |
Interest paid to related parties | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.20 | $0.60 | ' |
QUARTERLY_FINANCIAL_INFORMATIO2
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||
Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 13, 2013 | Jul. 02, 2012 | |
SureWest | ||||||||||||||
Quarterly Financial Information (Unaudited) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | $147,956,000 | $150,773,000 | $151,320,000 | $151,528,000 | $153,844,000 | $151,025,000 | $86,557,000 | $86,451,000 | $601,577,000 | $477,877,000 | $349,003,000 | ' | ' |
Operating income | ' | 22,217,000 | 26,167,000 | 26,947,000 | 28,330,000 | 20,167,000 | 8,185,000 | 13,147,000 | 9,918,000 | 103,661,000 | 51,417,000 | 58,829,000 | ' | ' |
Income (loss) from continuing operations | ' | 3,216,000 | 10,330,000 | 9,560,000 | 6,858,000 | 2,778,000 | -1,311,000 | 2,321,000 | 1,177,000 | 29,964,000 | 4,965,000 | 24,288,000 | ' | ' |
Discontinued operations, net of tax | ' | ' | 1,425,000 | -272,000 | 24,000 | -553,000 | 467,000 | 585,000 | 707,000 | 1,177,000 | 1,206,000 | 2,694,000 | ' | ' |
Net income (loss) attributable to common stockholders | ' | 3,140,000 | 11,694,000 | 9,194,000 | 6,783,000 | 2,060,000 | -965,000 | 2,786,000 | 1,759,000 | 30,811,000 | 5,640,000 | 26,410,000 | ' | ' |
Basic and diluted earnings (loss) per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income from continuing operations (in dollars per share) | ' | $0.08 | $0.26 | $0.23 | $0.17 | $0.07 | ($0.03) | $0.07 | $0.03 | $0.73 | $0.12 | $0.79 | ' | ' |
Discontinued operations, net of tax (in dollars per share) | ' | ' | $0.03 | ($0.01) | ' | ($0.02) | $0.01 | $0.02 | $0.03 | $0.03 | $0.03 | $0.09 | ' | ' |
Net income per basic and diluted common shares attributable to common shareholders (in dollars per share) | ' | $0.08 | $0.29 | $0.22 | $0.17 | $0.05 | ($0.02) | $0.09 | $0.06 | $0.76 | $0.15 | $0.88 | ' | ' |
Discontinued Operations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total purchase price for the sale of the assets and contractual rights related to prison services | 2,500,000 | ' | 2,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,500,000 | ' |
Gain on sale of the assets and contractual rights related to prison services, net of tax | $1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | $1,333,000 | ' | ' | ' | ' |
Percentage of outstanding shares acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% |
CONDENSED_CONSOLIDATING_FINANC2
CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Details) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | $5,551 | $17,854 | $105,704 | $67,654 |
Accounts receivable, net | 52,033 | 57,957 | ' | ' |
Income taxes receivable | 9,796 | 12,020 | ' | ' |
Deferred income taxes | 7,960 | 9,000 | ' | ' |
Prepaid expenses and other current assets | 12,380 | 11,269 | ' | ' |
Assets of discontinued operations | ' | 1,189 | ' | ' |
Total current assets | 87,720 | 109,289 | ' | ' |
Property, plant and equipment, net | 885,362 | 907,672 | ' | ' |
Intangibles and other assets: | ' | ' | ' | ' |
Investments | 113,099 | 109,750 | ' | ' |
Goodwill | 603,446 | 603,446 | ' | ' |
Other intangible assets | 40,084 | 49,530 | ' | ' |
Deferred debt issuance costs, net and other assets | 17,667 | 13,800 | ' | ' |
Total assets | 1,747,378 | 1,793,487 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 4,885 | 14,954 | ' | ' |
Advance billings and customer deposits | 25,934 | 27,654 | ' | ' |
Dividends payable | 15,520 | 15,463 | ' | ' |
Accrued compensation | 22,252 | 21,912 | ' | ' |
Accrued expense | 38,697 | 47,225 | ' | ' |
Current portion of long term debt and capital lease obligations | 9,751 | 9,596 | ' | ' |
Current portion of derivative liability | 660 | 3,164 | ' | ' |
Liabilities of discontinued operations | ' | 4,209 | ' | ' |
Total current liabilities | 117,699 | 144,177 | ' | ' |
Long-term debt and capital lease obligations | 1,212,134 | 1,208,248 | ' | ' |
Deferred income taxes | 179,859 | 137,501 | ' | ' |
Pension and postretirement benefit obligations | 75,754 | 156,710 | ' | ' |
Other long-term liabilities | 9,593 | 10,746 | ' | ' |
Total liabilities | 1,595,039 | 1,657,382 | ' | ' |
Shareholders' equity: | ' | ' | ' | ' |
Common Stock | 401 | 399 | ' | ' |
Other shareholders' equity | 147,433 | 131,531 | ' | ' |
Total Consolidated Communications Holdings, Inc. shareholders' equity | 147,834 | 131,930 | ' | ' |
Noncontrolling interest | 4,505 | 4,175 | ' | ' |
Total shareholders' equity | 152,339 | 136,105 | 47,812 | 71,875 |
Total liabilities and shareholders' equity | 1,747,378 | 1,793,487 | ' | ' |
Eliminations | ' | ' | ' | ' |
Intangibles and other assets: | ' | ' | ' | ' |
Investments in subsidiaries | -1,448,828 | -1,189,388 | ' | ' |
Total assets | -1,448,828 | -1,189,388 | ' | ' |
Shareholders' equity: | ' | ' | ' | ' |
Common Stock | -47,411 | -47,411 | ' | ' |
Other shareholders' equity | -1,401,417 | -1,141,977 | ' | ' |
Total Consolidated Communications Holdings, Inc. shareholders' equity | -1,448,828 | -1,189,388 | ' | ' |
Total shareholders' equity | -1,448,828 | -1,189,388 | ' | ' |
Total liabilities and shareholders' equity | -1,448,828 | -1,189,388 | ' | ' |
Parent | Reportable legal entity | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Accounts receivable, net | ' | 19 | ' | ' |
Income taxes receivable | 9,346 | 4,258 | ' | ' |
Deferred income taxes | -61 | -51 | ' | ' |
Total current assets | 9,285 | 4,226 | ' | ' |
Intangibles and other assets: | ' | ' | ' | ' |
Investments in subsidiaries | 1,101,039 | 958,199 | ' | ' |
Total assets | 1,110,324 | 962,425 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Dividends payable | 15,520 | 15,463 | ' | ' |
Accrued compensation | ' | 36 | ' | ' |
Accrued expense | 224 | 235 | ' | ' |
Total current liabilities | 15,744 | 15,734 | ' | ' |
Advances due to/from affiliates, net | 968,319 | 817,118 | ' | ' |
Deferred income taxes | -21,598 | -2,357 | ' | ' |
Other long-term liabilities | 25 | ' | ' | ' |
Total liabilities | 962,490 | 830,495 | ' | ' |
Shareholders' equity: | ' | ' | ' | ' |
Common Stock | 401 | 399 | ' | ' |
Other shareholders' equity | 147,433 | 131,531 | ' | ' |
Total Consolidated Communications Holdings, Inc. shareholders' equity | 147,834 | 131,930 | ' | ' |
Total shareholders' equity | 147,834 | 131,930 | ' | ' |
Total liabilities and shareholders' equity | 1,110,324 | 962,425 | ' | ' |
Subsidiary Issuer | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 86 | 6,577 | 103,369 | 65,398 |
Subsidiary Issuer | Reportable legal entity | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 86 | 6,577 | ' | ' |
Accounts receivable, net | 502 | 457 | ' | ' |
Deferred income taxes | -7 | -310 | ' | ' |
Total current assets | 581 | 6,724 | ' | ' |
Intangibles and other assets: | ' | ' | ' | ' |
Investments | 3,729 | 3,641 | ' | ' |
Investments in subsidiaries | 335,659 | 219,955 | ' | ' |
Deferred debt issuance costs, net and other assets | 13,620 | 12,788 | ' | ' |
Total assets | 353,589 | 243,108 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accrued expense | 4,389 | 3,373 | ' | ' |
Current portion of long term debt and capital lease obligations | 9,100 | 9,242 | ' | ' |
Current portion of derivative liability | 660 | 3,164 | ' | ' |
Total current liabilities | 14,149 | 15,779 | ' | ' |
Long-term debt and capital lease obligations | 1,207,663 | 1,203,760 | ' | ' |
Advances due to/from affiliates, net | -1,970,192 | -1,934,978 | ' | ' |
Deferred income taxes | -1,029 | -3,571 | ' | ' |
Other long-term liabilities | 1,960 | 3,919 | ' | ' |
Total liabilities | -747,449 | -715,091 | ' | ' |
Shareholders' equity: | ' | ' | ' | ' |
Other shareholders' equity | 1,101,038 | 958,199 | ' | ' |
Total Consolidated Communications Holdings, Inc. shareholders' equity | 1,101,038 | 958,199 | ' | ' |
Total shareholders' equity | 1,101,038 | 958,199 | ' | ' |
Total liabilities and shareholders' equity | 353,589 | 243,108 | ' | ' |
Guarantors | ' | ' | ' | ' |
Condensed Consolidating Balance Sheet | ' | ' | ' | ' |
Ownership interest (as a percent) | 100.00% | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 2,366 | 8,530 | 80 | 52 |
Guarantors | Reportable legal entity | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 2,366 | 8,530 | ' | ' |
Accounts receivable, net | 44,521 | 49,483 | ' | ' |
Income taxes receivable | 370 | 7,886 | ' | ' |
Deferred income taxes | 7,533 | 8,985 | ' | ' |
Prepaid expenses and other current assets | 11,862 | 10,855 | ' | ' |
Assets of discontinued operations | ' | 1,189 | ' | ' |
Total current assets | 66,652 | 86,928 | ' | ' |
Property, plant and equipment, net | 834,199 | 855,158 | ' | ' |
Intangibles and other assets: | ' | ' | ' | ' |
Investments | 109,370 | 106,094 | ' | ' |
Investments in subsidiaries | 12,130 | 11,234 | ' | ' |
Goodwill | 537,265 | 537,265 | ' | ' |
Other intangible assets | 30,997 | 40,443 | ' | ' |
Deferred debt issuance costs, net and other assets | 4,047 | 1,012 | ' | ' |
Total assets | 1,594,660 | 1,638,134 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Accounts payable | 4,885 | 14,954 | ' | ' |
Advance billings and customer deposits | 23,699 | 25,131 | ' | ' |
Accrued compensation | 20,447 | 19,863 | ' | ' |
Accrued expense | 32,709 | 39,673 | ' | ' |
Current portion of long term debt and capital lease obligations | 586 | 300 | ' | ' |
Liabilities of discontinued operations | ' | 4,209 | ' | ' |
Total current liabilities | 82,326 | 104,130 | ' | ' |
Long-term debt and capital lease obligations | 3,659 | 3,611 | ' | ' |
Advances due to/from affiliates, net | 1,037,969 | 1,137,159 | ' | ' |
Deferred income taxes | 184,209 | 134,550 | ' | ' |
Pension and postretirement benefit obligations | 61,053 | 125,706 | ' | ' |
Other long-term liabilities | 7,328 | 6,587 | ' | ' |
Total liabilities | 1,376,544 | 1,511,743 | ' | ' |
Shareholders' equity: | ' | ' | ' | ' |
Common Stock | 17,411 | 17,411 | ' | ' |
Other shareholders' equity | 196,200 | 104,805 | ' | ' |
Total Consolidated Communications Holdings, Inc. shareholders' equity | 213,611 | 122,216 | ' | ' |
Noncontrolling interest | 4,505 | 4,175 | ' | ' |
Total shareholders' equity | 218,116 | 126,391 | ' | ' |
Total liabilities and shareholders' equity | 1,594,660 | 1,638,134 | ' | ' |
Non-Guarantors | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 3,099 | 2,747 | 2,255 | 2,204 |
Non-Guarantors | Reportable legal entity | ' | ' | ' | ' |
Current assets: | ' | ' | ' | ' |
Cash and cash equivalents | 3,099 | 2,747 | ' | ' |
Accounts receivable, net | 7,010 | 7,998 | ' | ' |
Income taxes receivable | 80 | -124 | ' | ' |
Deferred income taxes | 495 | 376 | ' | ' |
Prepaid expenses and other current assets | 518 | 414 | ' | ' |
Total current assets | 11,202 | 11,411 | ' | ' |
Property, plant and equipment, net | 51,163 | 52,514 | ' | ' |
Intangibles and other assets: | ' | ' | ' | ' |
Investments | ' | 15 | ' | ' |
Goodwill | 66,181 | 66,181 | ' | ' |
Other intangible assets | 9,087 | 9,087 | ' | ' |
Total assets | 137,633 | 139,208 | ' | ' |
Current liabilities: | ' | ' | ' | ' |
Advance billings and customer deposits | 2,235 | 2,523 | ' | ' |
Accrued compensation | 1,805 | 2,013 | ' | ' |
Accrued expense | 1,375 | 3,944 | ' | ' |
Current portion of long term debt and capital lease obligations | 65 | 54 | ' | ' |
Total current liabilities | 5,480 | 8,534 | ' | ' |
Long-term debt and capital lease obligations | 812 | 877 | ' | ' |
Advances due to/from affiliates, net | -36,096 | -19,299 | ' | ' |
Deferred income taxes | 18,277 | 8,879 | ' | ' |
Pension and postretirement benefit obligations | 14,701 | 31,004 | ' | ' |
Other long-term liabilities | 280 | 240 | ' | ' |
Total liabilities | 3,454 | 30,235 | ' | ' |
Shareholders' equity: | ' | ' | ' | ' |
Common Stock | 30,000 | 30,000 | ' | ' |
Other shareholders' equity | 104,179 | 78,973 | ' | ' |
Total Consolidated Communications Holdings, Inc. shareholders' equity | 134,179 | 108,973 | ' | ' |
Total shareholders' equity | 134,179 | 108,973 | ' | ' |
Total liabilities and shareholders' equity | $137,633 | $139,208 | ' | ' |
CONDENSED_CONSOLIDATING_FINANC3
CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | $147,956 | $150,773 | $151,320 | $151,528 | $153,844 | $151,025 | $86,557 | $86,451 | $601,577 | $477,877 | $349,003 |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of services and products (exclusive of depreciation and amortization) | ' | ' | ' | ' | ' | ' | ' | ' | 222,452 | 175,929 | 121,711 |
Selling, general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 135,414 | 108,163 | 77,724 |
Financing and other transaction costs | ' | ' | ' | ' | ' | ' | ' | ' | 776 | 20,800 | 2,649 |
Intangible assets impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,236 | ' |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 139,274 | 120,332 | 88,090 |
Income from operations | 22,217 | 26,167 | 26,947 | 28,330 | 20,167 | 8,185 | 13,147 | 9,918 | 103,661 | 51,417 | 58,829 |
Other income (expense): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net of interest income | ' | ' | ' | ' | ' | ' | ' | ' | -85,767 | -72,604 | -49,391 |
Loss on extinguishment of debt | ' | ' | ' | ' | ' | ' | ' | ' | -7,657 | -4,455 | ' |
Investment income | ' | ' | ' | ' | ' | ' | ' | ' | 37,695 | 30,667 | 27,843 |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | -456 | 601 | 148 |
Income from continuing operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 47,476 | 5,626 | 37,429 |
Income tax expense (benefit) | ' | ' | ' | ' | ' | ' | ' | ' | 17,512 | 661 | 13,141 |
Income from continuing operations | 3,216 | 10,330 | 9,560 | 6,858 | 2,778 | -1,311 | 2,321 | 1,177 | 29,964 | 4,965 | 24,288 |
Discontinued operations, net of tax | ' | 1,425 | -272 | 24 | -553 | 467 | 585 | 707 | 1,177 | 1,206 | 2,694 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 31,141 | 6,171 | 26,982 |
Less: net income attributable to noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | 330 | 531 | 572 |
Net income attributable to common shareholders | 3,140 | 11,694 | 9,194 | 6,783 | 2,060 | -965 | 2,786 | 1,759 | 30,811 | 5,640 | 26,410 |
Total comprehensive income (loss) attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 75,595 | -2,311 | 20,048 |
Eliminations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | ' | ' | -14,126 | -14,185 | -13,771 |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of services and products (exclusive of depreciation and amortization) | ' | ' | ' | ' | ' | ' | ' | ' | -12,947 | -14,185 | -13,771 |
Selling, general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | -1,179 | ' | ' |
Other income (expense): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity in earnings of subsidiaries, net | ' | ' | ' | ' | ' | ' | ' | ' | -173,430 | -98,649 | -89,158 |
Income from continuing operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -173,430 | -98,649 | -89,158 |
Income from continuing operations | ' | ' | ' | ' | ' | ' | ' | ' | -173,430 | -98,649 | -89,158 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | -173,430 | -98,649 | -89,158 |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | -173,430 | -98,649 | -89,158 |
Total comprehensive income (loss) attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | -173,430 | -98,649 | -89,158 |
Parent | Reportable legal entity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selling, general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 3,608 | 2,530 | 2,249 |
Financing and other transaction costs | ' | ' | ' | ' | ' | ' | ' | ' | 457 | 11,269 | ' |
Income from operations | ' | ' | ' | ' | ' | ' | ' | ' | -4,065 | -13,799 | -2,249 |
Other income (expense): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net of interest income | ' | ' | ' | ' | ' | ' | ' | ' | 100 | -20 | ' |
Intercompany interest income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -103,588 | -50,126 | -40,283 |
Equity in earnings of subsidiaries, net | ' | ' | ' | ' | ' | ' | ' | ' | 98,055 | 48,942 | 53,217 |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | -18 | ' | ' |
Income from continuing operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -9,516 | -15,003 | 10,685 |
Income tax expense (benefit) | ' | ' | ' | ' | ' | ' | ' | ' | -40,327 | -20,643 | -15,725 |
Income from continuing operations | ' | ' | ' | ' | ' | ' | ' | ' | 30,811 | 5,640 | 26,410 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 30,811 | 5,640 | 26,410 |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 30,811 | 5,640 | 26,410 |
Total comprehensive income (loss) attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 30,811 | 5,640 | 26,410 |
Subsidiary Issuer | Reportable legal entity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | ' | ' | -60 | -15 | 25 |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selling, general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 167 | 385 | 2,724 |
Financing and other transaction costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,531 | ' |
Income from operations | ' | ' | ' | ' | ' | ' | ' | ' | -227 | -9,931 | -2,699 |
Other income (expense): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net of interest income | ' | ' | ' | ' | ' | ' | ' | ' | -86,090 | -71,704 | -48,095 |
Intercompany interest income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | 126,918 | 87,717 | 80,142 |
Loss on extinguishment of debt | ' | ' | ' | ' | ' | ' | ' | ' | -7,657 | -4,455 | ' |
Investment income | ' | ' | ' | ' | ' | ' | ' | ' | 89 | 246 | 246 |
Equity in earnings of subsidiaries, net | ' | ' | ' | ' | ' | ' | ' | ' | 74,479 | 48,272 | 34,399 |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Income from continuing operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 107,512 | 50,146 | 63,993 |
Income tax expense (benefit) | ' | ' | ' | ' | ' | ' | ' | ' | 9,457 | 1,204 | 10,776 |
Income from continuing operations | ' | ' | ' | ' | ' | ' | ' | ' | 98,055 | 48,942 | 53,217 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 98,055 | 48,942 | 53,217 |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 98,055 | 48,942 | 53,217 |
Total comprehensive income (loss) attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 101,616 | 53,920 | 60,814 |
Guarantors | Reportable legal entity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | ' | ' | 547,635 | 423,303 | 291,500 |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of services and products (exclusive of depreciation and amortization) | ' | ' | ' | ' | ' | ' | ' | ' | 220,764 | 175,759 | 120,750 |
Selling, general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 113,942 | 88,664 | 56,677 |
Financing and other transaction costs | ' | ' | ' | ' | ' | ' | ' | ' | 319 | ' | 2,649 |
Intangible assets impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,236 | ' |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 130,455 | 107,064 | 72,999 |
Income from operations | ' | ' | ' | ' | ' | ' | ' | ' | 82,155 | 50,580 | 38,425 |
Other income (expense): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net of interest income | ' | ' | ' | ' | ' | ' | ' | ' | 181 | -816 | -1,130 |
Intercompany interest income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | -24,662 | -37,509 | -39,407 |
Investment income | ' | ' | ' | ' | ' | ' | ' | ' | 37,606 | 30,421 | 27,597 |
Equity in earnings of subsidiaries, net | ' | ' | ' | ' | ' | ' | ' | ' | 896 | 1,435 | 1,542 |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | -448 | 617 | 1,422 |
Income from continuing operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 95,728 | 44,728 | 28,449 |
Income tax expense (benefit) | ' | ' | ' | ' | ' | ' | ' | ' | 38,038 | 11,239 | 9,219 |
Income from continuing operations | ' | ' | ' | ' | ' | ' | ' | ' | 57,690 | 33,489 | 19,230 |
Discontinued operations, net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1,177 | 1,206 | 2,694 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 58,867 | 34,695 | 21,924 |
Less: net income attributable to noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | 330 | 531 | 572 |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 58,537 | 34,164 | 21,352 |
Total comprehensive income (loss) attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 91,395 | 24,816 | 11,830 |
Non-Guarantors | Reportable legal entity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenues | ' | ' | ' | ' | ' | ' | ' | ' | 68,128 | 68,774 | 71,249 |
Operating expenses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of services and products (exclusive of depreciation and amortization) | ' | ' | ' | ' | ' | ' | ' | ' | 14,635 | 14,355 | 14,732 |
Selling, general and administrative expenses | ' | ' | ' | ' | ' | ' | ' | ' | 18,876 | 16,584 | 16,074 |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 8,819 | 13,268 | 15,091 |
Income from operations | ' | ' | ' | ' | ' | ' | ' | ' | 25,798 | 24,567 | 25,352 |
Other income (expense): | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense, net of interest income | ' | ' | ' | ' | ' | ' | ' | ' | 42 | -64 | -166 |
Intercompany interest income (expense) | ' | ' | ' | ' | ' | ' | ' | ' | 1,332 | -82 | -452 |
Other, net | ' | ' | ' | ' | ' | ' | ' | ' | 10 | -17 | -1,274 |
Income from continuing operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | 27,182 | 24,404 | 23,460 |
Income tax expense (benefit) | ' | ' | ' | ' | ' | ' | ' | ' | 10,344 | 8,861 | 8,871 |
Income from continuing operations | ' | ' | ' | ' | ' | ' | ' | ' | 16,838 | 15,543 | 14,589 |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | 16,838 | 15,543 | 14,589 |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | 16,838 | 15,543 | 14,589 |
Total comprehensive income (loss) attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | $25,203 | $11,962 | $10,152 |
CONDENSED_CONSOLIDATING_FINANC4
CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Details 3) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities: | ' | ' | ' |
Net cash (used in) provided by continuing operations | $168,530 | $119,732 | $124,302 |
Net cash used in discontinued operations | -4,174 | 3,483 | 5,202 |
Net cash provided by operating activities | 164,356 | 123,215 | 129,504 |
Cash flows from investing activities: | ' | ' | ' |
Business acquisition, net of cash acquired | ' | -385,346 | ' |
Purchases of property, plant and equipment | -107,363 | -76,998 | -41,794 |
Purchase of investments | -403 | -6,728 | ' |
Proceeds from sale of assets | 330 | 924 | 840 |
Other | ' | -314 | 272 |
Net cash used in continuing operations | -107,436 | -468,462 | -40,682 |
Net cash provided by discontinued operations | 2,331 | -97 | -119 |
Net cash used in investing activities | -105,105 | -468,559 | -40,801 |
Cash flows from financing activities: | ' | ' | ' |
Proceeds on bond offering | ' | 298,035 | ' |
Proceeds from issuance of long-term debt | 989,450 | 544,850 | ' |
Payment of capital lease obligation | -516 | -228 | -149 |
Payment on long-term debt | -990,961 | -510,038 | ' |
Payment of financing costs | -6,576 | -18,616 | -3,471 |
Distributions to non-controlling interests | ' | -1,850 | ' |
Dividends on common stock | -62,064 | -54,100 | -46,307 |
Repurchase and retirement of common stock | -887 | -559 | -726 |
Net cash provided by (used in) financing activities | -71,554 | 257,494 | -50,653 |
(Decrease)/increase in cash and cash equivalents | -12,303 | -87,850 | 38,050 |
Cash and cash equivalents at beginning of period | 17,854 | 105,704 | 67,654 |
Cash and cash equivalents at end of period | 5,551 | 17,854 | 105,704 |
Parent | ' | ' | ' |
Cash flows from operating activities: | ' | ' | ' |
Net cash (used in) provided by continuing operations | -88,251 | -52,318 | -27,033 |
Net cash provided by operating activities | -88,251 | -52,318 | -27,033 |
Cash flows from investing activities: | ' | ' | ' |
Business acquisition, net of cash acquired | ' | -385,346 | ' |
Other | ' | -314 | ' |
Net cash used in continuing operations | ' | -385,660 | ' |
Net cash used in investing activities | ' | -385,660 | ' |
Cash flows from financing activities: | ' | ' | ' |
Dividends on common stock | -62,064 | -54,100 | -46,307 |
Repurchase and retirement of common stock | -887 | -559 | -726 |
Transactions with affiliates, net | 151,202 | 492,637 | 74,066 |
Net cash provided by (used in) financing activities | 88,251 | 437,978 | 27,033 |
Subsidiary Issuer | ' | ' | ' |
Cash flows from operating activities: | ' | ' | ' |
Net cash (used in) provided by continuing operations | 36,811 | 13,106 | 22,335 |
Net cash provided by operating activities | 36,811 | 13,106 | 22,335 |
Cash flows from financing activities: | ' | ' | ' |
Proceeds on bond offering | ' | 298,035 | ' |
Proceeds from issuance of long-term debt | 989,450 | 544,850 | ' |
Payment on long-term debt | -990,961 | -510,038 | ' |
Payment of financing costs | -6,576 | -18,616 | -3,471 |
Transactions with affiliates, net | -35,215 | -424,129 | 19,107 |
Net cash provided by (used in) financing activities | -43,302 | -109,898 | 15,636 |
(Decrease)/increase in cash and cash equivalents | -6,491 | -96,792 | 37,971 |
Cash and cash equivalents at beginning of period | 6,577 | 103,369 | 65,398 |
Cash and cash equivalents at end of period | 86 | 6,577 | 103,369 |
Guarantor Subsidiaries | ' | ' | ' |
Cash flows from operating activities: | ' | ' | ' |
Net cash (used in) provided by continuing operations | 195,591 | 137,386 | 98,764 |
Net cash used in discontinued operations | -4,174 | 3,483 | 5,202 |
Net cash provided by operating activities | 191,417 | 140,869 | 103,966 |
Cash flows from investing activities: | ' | ' | ' |
Purchases of property, plant and equipment | -100,139 | -70,948 | -35,212 |
Purchase of investments | -403 | -6,728 | ' |
Proceeds from sale of assets | 282 | 882 | 511 |
Other | ' | ' | 272 |
Net cash used in continuing operations | -100,260 | -76,794 | -34,429 |
Net cash provided by discontinued operations | 2,331 | -97 | -119 |
Net cash used in investing activities | -97,929 | -76,891 | -34,548 |
Cash flows from financing activities: | ' | ' | ' |
Payment of capital lease obligation | -462 | -183 | -113 |
Distributions to non-controlling interests | ' | 3,150 | ' |
Transactions with affiliates, net | -99,190 | -58,495 | -69,277 |
Net cash provided by (used in) financing activities | -99,652 | -55,528 | -69,390 |
(Decrease)/increase in cash and cash equivalents | -6,164 | 8,450 | 28 |
Cash and cash equivalents at beginning of period | 8,530 | 80 | 52 |
Cash and cash equivalents at end of period | 2,366 | 8,530 | 80 |
Non-Guarantors | ' | ' | ' |
Cash flows from operating activities: | ' | ' | ' |
Net cash (used in) provided by continuing operations | 24,379 | 21,558 | 30,236 |
Net cash provided by operating activities | 24,379 | 21,558 | 30,236 |
Cash flows from investing activities: | ' | ' | ' |
Purchases of property, plant and equipment | -7,224 | -6,050 | -6,582 |
Proceeds from sale of assets | 48 | 42 | 329 |
Net cash used in continuing operations | -7,176 | -6,008 | -6,253 |
Net cash used in investing activities | -7,176 | -6,008 | -6,253 |
Cash flows from financing activities: | ' | ' | ' |
Payment of capital lease obligation | -54 | -45 | -36 |
Distributions to non-controlling interests | ' | -5,000 | ' |
Transactions with affiliates, net | -16,797 | -10,013 | -23,896 |
Net cash provided by (used in) financing activities | -16,851 | -15,058 | -23,932 |
(Decrease)/increase in cash and cash equivalents | 352 | 492 | 51 |
Cash and cash equivalents at beginning of period | 2,747 | 2,255 | 2,204 |
Cash and cash equivalents at end of period | $3,099 | $2,747 | $2,255 |