Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended |
Mar. 31, 2014 | |
Entity Registrant Name | 'United States Cellular Corporation |
Entity Central Index Key | '0000821130 |
Document Type | '10-Q |
Document Period End Date | 31-Mar-14 |
Amendment Flag | 'false |
Current Fiscal Year End Date | '--12-31 |
Entity Filer Category | 'Accelerated Filer |
Document Fiscal Year Focus | '2014 |
Document Fiscal Period Focus | 'Q1 |
Trading Symbol | 'USM |
Common Shares | ' |
Entity Common Stock, Shares Outstanding | 51,178,608 |
Series A Common Shares | ' |
Entity Common Stock, Shares Outstanding | 33,005,877 |
Consolidated_Statement_Of_Oper
Consolidated Statement Of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Operating revenues | ' | ' |
Service | $853,613 | $996,349 |
Equipment sales | 72,198 | 85,397 |
Total operating revenues | 925,811 | 1,081,746 |
Operating expenses | ' | ' |
System operations (excluding Depreciation, amortization and accretion reported below) | 180,607 | 216,299 |
Cost of equipment sold | 270,474 | 241,691 |
Selling, general and administrative (including charges from affiliates of $21.2 million and $23.5 million, respectively) | 395,564 | 420,080 |
Depreciation, amortization and accretion | 167,753 | 189,845 |
(Gain) loss on asset disposals, net | 1,934 | 5,434 |
(Gain) loss on sale of business and other exit costs, net | -6,900 | 6,931 |
(Gain) loss on license sales and exchanges | -91,446 | ' |
Total operating expenses | 917,986 | 1,080,280 |
Operating income | 7,825 | 1,466 |
Investment and other income (expense) | ' | ' |
Equity in earnings of unconsolidated entities | 37,075 | 26,835 |
Interest and dividend income | 884 | 903 |
Interest expense | -14,862 | -10,910 |
Other, net | 86 | -215 |
Total investment and other income | 23,183 | 16,613 |
Income before income taxes | 31,008 | 18,079 |
Income tax expense | 12,604 | 7,369 |
Net income | 18,404 | 10,710 |
Less: Net income (loss) attributable to noncontrolling interests, net of tax | -1,078 | 5,796 |
Net income attributable to U.S. Cellular shareholders | $19,482 | $4,914 |
Basic weighted average shares outstanding | 84,213 | 83,838 |
Basic earnings per share attributable to U.S. Cellular shareholders | $0.23 | $0.06 |
Diluted weighted average shares outstanding | 85,065 | 84,588 |
Diluted earnings per share attributable to U.S. Cellular shareholders | $0.23 | $0.06 |
Consolidated_Statement_Of_Oper1
Consolidated Statement Of Operations Parenthetical (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Operating expenses | ' | ' |
Selling, general and administrative, charges from affiliates | $21.20 | $23.50 |
Consolidated_Statement_of_Cash
Consolidated Statement of Cash Flows (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Cash flows from operating activities | ' | ' |
Net income | $18,404,000 | $10,710,000 |
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities | ' | ' |
Depreciation, amortization and accretion | 167,753,000 | 189,845,000 |
Bad debts expense | 20,492,000 | 16,910,000 |
Stock-based compensation expense | 4,955,000 | 5,036,000 |
Deferred income taxes, net | -4,817,000 | 7,048,000 |
Equity in earnings of unconsolidated entities | -37,075,000 | -26,835,000 |
Distributions from unconsolidated entities | 12,818,000 | 5,836,000 |
(Gain) loss on asset disposals, net | 1,934,000 | 5,434,000 |
(Gain) loss on sale of business and other exit costs, net | -6,900,000 | 6,931,000 |
(Gain) loss on license sales and exchanges | -91,446,000 | ' |
Noncash interest expense | 269,000 | 262,000 |
Other operating activities | 47,000 | 250,000 |
Changes in assets and liabilities from operations | ' | ' |
Accounts receivable | 81,980,000 | 33,611,000 |
Inventory | 19,306,000 | 16,750,000 |
Accounts payable - trade | -38,245,000 | 4,644,000 |
Accounts payable - affiliate | -2,312,000 | -1,933,000 |
Customer deposits and deferred revenues | -1,510,000 | 8,862,000 |
Accrued taxes | -15,403,000 | 6,175,000 |
Accrued interest | 9,182,000 | 9,201,000 |
Other assets and liabilities | -75,896,000 | -75,122,000 |
Cash flows from operating activities | 63,536,000 | 223,615,000 |
Cash flows from investing activities | ' | ' |
Cash used for additions to property, plant and equipment | -109,498,000 | -151,024,000 |
Cash paid for aquisitions and licenses | -9,135,000 | -14,150,000 |
Cash received from divestitures | 103,042,000 | ' |
Cash received for investments | 10,000,000 | ' |
Other investing activities | 584,000 | 3,654,000 |
Cash flows from investing activities | -5,007,000 | -161,520,000 |
Cash flows from financing activities | ' | ' |
Repayment of long-term debt | -23,000 | -61,000 |
Common shares reissued for benefit plans, net of tax payments | 316,000 | 123,000 |
Common shares repurchased | -2,000,000 | -18,425,000 |
Distributions to noncontrolling interests | -346,000 | -2,396,000 |
Other financing activities | ' | 2,000 |
Cash flows from financing activities | -2,053,000 | -20,757,000 |
Net increase in cash and cash equivalents | 56,476,000 | 41,338,000 |
Cash and cash equivalents | ' | ' |
Beginning of period | 342,065,000 | 378,358,000 |
End of period | $398,541,000 | $419,696,000 |
Consolidated_Balance_Sheet
Consolidated Balance Sheet (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets | ' | ' |
Cash and cash equivalents | $398,541 | $342,065 |
Short-term investments | 40,056 | 50,104 |
Accounts receivable | ' | ' |
Customers and agents, less allowances of $52,431 and $59,206, respectively | 352,366 | 467,255 |
Roaming | 26,833 | 30,136 |
Affiliated | 667 | 980 |
Other, less allowances of $713 and $1,032, respectively | 104,605 | 88,224 |
Inventory, net | 218,882 | 238,188 |
Prepaid expenses | 65,510 | 65,596 |
Net deferred income tax asset | 99,105 | 99,105 |
Other current assets | 19,702 | 19,538 |
Total current assets | 1,326,267 | 1,401,191 |
Assets held for sale | ' | 16,027 |
Investments | ' | ' |
Licenses | 1,425,945 | 1,401,126 |
Goodwill | 387,524 | 387,524 |
Investments in unconsolidated entities | 289,842 | 265,585 |
Total investments | 2,103,311 | 2,054,235 |
Property, plant and equipment | ' | ' |
In service and under construction | 7,715,292 | 7,717,512 |
Less: Accumulated depreciation | 4,939,072 | 4,860,992 |
Property, plant and equipment, net | 2,776,220 | 2,856,520 |
Other assets and deferred charges | 132,536 | 117,735 |
Total assets | 6,338,334 | 6,445,708 |
Current liabilities | ' | ' |
Current portion of long-term debt | 166 | 166 |
Accounts payable | ' | ' |
Affiliated | 9,266 | 11,243 |
Trade | 347,459 | 405,583 |
Customer deposits and deferred revenues | 255,230 | 256,740 |
Accrued taxes | 58,574 | 73,820 |
Accrued compensation | 35,930 | 66,566 |
Other current liabilities | 161,446 | 192,055 |
Total current liabilities | 868,071 | 1,006,173 |
Deferred liabilities and credits | ' | ' |
Net deferred income tax liability | 830,960 | 836,297 |
Other deferred liabilities and credits | 330,467 | 315,073 |
Long-term debt | 878,127 | 878,032 |
Commitments and contingencies | ' | ' |
Noncontrolling interests with redemption features | 543 | 536 |
U.S. Cellular shareholders' equity | ' | ' |
Series A Common and Common Shares | 88,074 | 88,074 |
Additional paid-in capital | 1,429,148 | 1,424,729 |
Treasury Shares at cost | -165,577 | -164,692 |
Retained earnings | 2,061,561 | 2,043,095 |
Total U.S. Cellular shareholders' equity | 3,413,206 | 3,391,206 |
Noncontrolling interests | 16,960 | 18,391 |
Total equity | 3,430,166 | 3,409,597 |
Total liabilities and equity | $6,338,334 | $6,445,708 |
Consolidated_Balance_Sheet_Par
Consolidated Balance Sheet Parenthetical (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Current assets | ' | ' |
Customers and agents, allowances | $52,431 | $59,206 |
Other, allowances | 713 | 1,032 |
U.S. Cellular shareholders' equity | ' | ' |
Authorized shares | 190,000 | 190,000 |
Issued shares | 88,074 | 88,074 |
Outstanding shares | 84,185 | 84,205 |
Par value | 88,074 | 88,074 |
Treasury Shares | ' | ' |
U.S. Cellular shareholders' equity | ' | ' |
Treasury shares | 3,889 | 3,869 |
Common Shares | ' | ' |
U.S. Cellular shareholders' equity | ' | ' |
Authorized shares | 140,000 | 140,000 |
Issued shares | 55,068 | 55,068 |
Outstanding shares | 51,179 | 51,199 |
Par value per share | $1 | $1 |
Par value | 55,068 | 55,068 |
Common Shares | Treasury Shares | ' | ' |
U.S. Cellular shareholders' equity | ' | ' |
Treasury shares | 3,889 | 3,869 |
Series A Common Shares | ' | ' |
U.S. Cellular shareholders' equity | ' | ' |
Authorized shares | 50,000 | 50,000 |
Issued shares | 33,006 | 33,006 |
Outstanding shares | 33,006 | 33,006 |
Par value per share | $1 | $1 |
Par value | $33,006 | $33,006 |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Equity (USD $) | Total | Series A Common and Common Shares | Additional Paid-In Capital | Treasury Shares | Retained Earnings | Total U.S. Cellular Shareholders' Equity | Noncontrolling Interests |
In Thousands, unless otherwise specified | |||||||
Beginning balance at Dec. 31, 2012 | $3,795,247 | $88,074 | $1,412,453 | ($165,724) | $2,399,052 | $3,733,855 | $61,392 |
Add (Deduct) | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | 4,914 | ' | ' | ' | 4,914 | 4,914 | ' |
Net income (loss) attributable to noncontrolling interests classified as equity | 5,822 | ' | ' | ' | ' | ' | 5,822 |
Repurchase of Common Shares | -18,425 | ' | ' | -18,425 | ' | -18,425 | ' |
Incentive and compensation plans | 123 | ' | ' | 764 | -641 | 123 | ' |
Stock-based compensation awards | 5,036 | ' | 5,036 | ' | ' | 5,036 | ' |
Tax windfall (shortfall) from stock awards | -181 | ' | -181 | ' | ' | -181 | ' |
Distributions to noncontrolling interests | -2,396 | ' | ' | ' | ' | ' | -2,396 |
Ending balance at Mar. 31, 2013 | 3,790,140 | 88,074 | 1,417,308 | -183,385 | 2,403,325 | 3,725,322 | 64,818 |
Beginning balance at Dec. 31, 2013 | 3,409,597 | 88,074 | 1,424,729 | -164,692 | 2,043,095 | 3,391,206 | 18,391 |
Add (Deduct) | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | 19,482 | ' | ' | ' | 19,482 | 19,482 | ' |
Net income (loss) attributable to noncontrolling interests classified as equity | -1,107 | ' | ' | ' | ' | ' | -1,107 |
Repurchase of Common Shares | -2,300 | ' | ' | -2,300 | ' | -2,300 | ' |
Incentive and compensation plans | 399 | ' | ' | 1,415 | -1,016 | 399 | ' |
Stock-based compensation awards | 4,576 | ' | 4,576 | ' | ' | 4,576 | ' |
Tax windfall (shortfall) from stock awards | -157 | ' | -157 | ' | ' | -157 | ' |
Distributions to noncontrolling interests | -324 | ' | ' | ' | ' | ' | -324 |
Ending balance at Mar. 31, 2014 | $3,430,166 | $88,074 | $1,429,148 | ($165,577) | $2,061,561 | $3,413,206 | $16,960 |
Basis_of_Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2014 | |
Disclosure Text Block | ' |
Basis of Presentation | ' |
1. Basis of Presentation | |
United States Cellular Corporation (“U.S. Cellular”), a Delaware Corporation, is an 84%-owned subsidiary of Telephone and Data Systems, Inc. (“TDS”). | |
The accounting policies of U.S. Cellular conform to accounting principles generally accepted in the United States of America (“GAAP”) as set forth in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). The consolidated financial statements include the accounts of U.S. Cellular, its majority-owned subsidiaries, general partnerships in which U.S. Cellular has a majority partnership interest and certain entities in which U.S. Cellular has a variable interest that require consolidation under GAAP. All material intercompany accounts and transactions have been eliminated. | |
The consolidated financial statements included herein have been prepared by U.S. Cellular, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, U.S. Cellular believes that the disclosures included herein are adequate to make the information presented not misleading. These consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in U.S. Cellular's Annual Report on Form 10-K (“Form 10-K”) for the year ended December 31, 2013. | |
The accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring items, unless otherwise disclosed) necessary for a fair statement of the financial position as of March 31, 2014 and December 31, 2013, and the results of operations, cash flows and changes in equity for the three months ended March 31, 2014 and 2013. The Consolidated Statement of Comprehensive Income was not included because comprehensive income for the three months ended March 31, 2014 and 2013 equaled net income. These results are not necessarily indicative of the results to be expected for the full year. | |
Recently Issued Accounting Pronouncements | |
On April 10, 2014, the FASB issued Accounting Standards Update 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”). ASU 2014-08 changes the requirements and disclosures for reporting discontinued operations. U.S. Cellular is required to adopt the provisions of ASU 2014-08 effective January 1, 2015, although early adoption is permitted. The adoption of ASU 2014-08 is not expected to have a significant impact on U.S. Cellular's financial position or results of operations. | |
Amounts Collected from Customers and Remitted to Governmental Authorities | |
If a tax is assessed upon the customer and U.S. Cellular merely acts as an agent in collecting the tax on behalf of the imposing governmental authority, then amounts collected from customers and remitted to governmental authorities are recorded on a net basis within a tax liability account in the Consolidated Balance Sheet. If the tax is assessed upon U.S. Cellular, then amounts collected from customers as recovery of the tax are recorded in Service revenues and amounts remitted to governmental authorities are recorded in Selling, general and administrative expenses in the Consolidated Statement of Operations. The amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities totaled $26.4 million and $32.1 million for the three months ended March 31, 2014, and 2013, respectively. | |
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | ||||||||||||||
Mar. 31, 2014 | |||||||||||||||
Disclosure Text Block | ' | ||||||||||||||
Fair Value Measurements | ' | ||||||||||||||
2. Fair Value Measurements | |||||||||||||||
As of March 31, 2014 and December 31, 2013, U.S. Cellular did not have any financial or nonfinancial assets or liabilities that were required to be recorded at fair value in its Consolidated Balance Sheet in accordance with GAAP. However, U.S. Cellular has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below. | |||||||||||||||
Level within the Fair Value Hierarchy | 31-Mar-14 | 31-Dec-13 | |||||||||||||
Book Value | Fair Value | Book Value | Fair Value | ||||||||||||
(Dollars in thousands) | |||||||||||||||
Cash and cash equivalents | 1 | $ | 398,541 | $ | 398,541 | $ | 342,065 | $ | 342,065 | ||||||
Short-term investments | |||||||||||||||
U.S. Treasury Notes | 1 | 40,056 | 40,056 | 50,104 | 50,104 | ||||||||||
Long-term debt | |||||||||||||||
6.95% Senior Notes | 1 | 342,000 | 347,062 | 342,000 | 309,852 | ||||||||||
6.7% Senior Notes | 2 | 532,515 | 531,869 | 532,449 | 507,697 | ||||||||||
Short-term investments are designated as held-to-maturity investments and recorded at amortized cost in the Consolidated Balance Sheet. Long-term debt excludes capital lease obligations and the current portion of Long-term debt. | |||||||||||||||
The fair values of Cash and cash equivalents and Short-term investments approximate their book values due to the short-term nature of these financial instruments. The fair value of Long-term debt was estimated using market prices for the 6.95% Senior Notes, and discounted cash flow analysis using an estimated yield to maturity of 6.91% for the 6.7% Senior Notes at March 31, 2014. | |||||||||||||||
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2014 | |
Disclosure Text Block | ' |
Income Taxes | ' |
3. Income Taxes | |
U.S. Cellular is included in a consolidated federal income tax return and in certain state income tax returns with other members of the TDS consolidated group. For financial statement purposes, U.S. Cellular and its subsidiaries compute their income tax expense as if they comprised a separate affiliated group and were not included in the TDS consolidated group. | |
U.S. Cellular's overall effective tax rate on Income before income taxes for the three months ended March 31, 2014 and 2013 was 40.6% and 40.8%, respectively. |
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Disclosure Text Block | ' | ||||||
Earnings per Share | ' | ||||||
4. Earnings Per Share | |||||||
Basic earnings per share attributable to U.S. Cellular shareholders is computed by dividing Net income attributable to U.S. Cellular shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share attributable to U.S. Cellular shareholders is computed by dividing Net income attributable to U.S. Cellular shareholders by the weighted average number of common shares outstanding during the period adjusted to include the effects of potentially dilutive securities. Potentially dilutive securities primarily include incremental shares issuable upon exercise of outstanding stock options and the vesting of restricted stock units. | |||||||
The amounts used in computing earnings per common share and the effects of potentially dilutive securities on the weighted average number of common shares were as follows: | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2014 | 2013 | ||||||
(Dollars and shares in thousands, except per share amounts) | |||||||
Net income attributable to U.S. Cellular shareholders | $ | 19,482 | $ | 4,914 | |||
Weighted average number of shares used in basic earnings per share | 84,213 | 83,838 | |||||
Effects of dilutive securities: | |||||||
Stock options | 203 | 151 | |||||
Restricted stock units | 649 | 599 | |||||
Weighted average number of shares used in diluted earnings per share | 85,065 | 84,588 | |||||
Basic earnings per share attributable to U.S. Cellular shareholders | $ | 0.23 | $ | 0.06 | |||
Diluted earnings per share attributable to U.S. Cellular shareholders | $ | 0.23 | $ | 0.06 | |||
Certain Common Shares issuable upon the exercise of stock options or vesting of restricted stock units were not included in average diluted shares outstanding for the calculation of Diluted earnings per share attributable to U.S. Cellular shareholders because their effects were antidilutive. The number of such Common Shares excluded, if any, is shown in the table below. | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2014 | 2013 | ||||||
(Shares in thousands) | |||||||
Stock options | 1,276 | 2,226 | |||||
Restricted stock units | - | 1 | |||||
On June 25, 2013, U.S. Cellular paid a special cash dividend of $5.75 per share, for an aggregate amount of $482.3 million, to all holders of U.S. Cellular Common Shares and Series A Common Shares as of June 11, 2013. Outstanding U.S. Cellular stock options and restricted stock unit awards were equitably adjusted for the special cash dividend. The impact of such adjustments on the earnings per share calculation was reflected for all periods presented. | |||||||
Acquisitions_Divestitures_and_
Acquisitions, Divestitures and Exchanges | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||
Disclosure Text Block | ' | |||||||||||||||||||
Acquisitions, Divestitures and Exchanges | ' | |||||||||||||||||||
5. Acquisitions, Divestitures and Exchanges | ||||||||||||||||||||
Divestiture Transaction | ||||||||||||||||||||
On November 6, 2012, U.S. Cellular entered into a Purchase and Sale Agreement with subsidiaries of Sprint Corp., fka Sprint Nextel Corporation (“Sprint”). Pursuant to the Purchase and Sale Agreement, on May 16, 2013, U.S. Cellular transferred customers and certain PCS license spectrum to Sprint in U.S. Cellular's Chicago, central Illinois, St. Louis and certain Indiana/Michigan/Ohio markets (“Divestiture Markets”) in consideration for $480 million in cash. The Purchase and Sale Agreement also contemplated certain other agreements, together with the Purchase and Sale Agreement collectively referred to as the “Divestiture Transaction.” | ||||||||||||||||||||
Pursuant to the Purchase and Sale Agreement, U.S. Cellular and Sprint also entered into certain other agreements, including customer and network transition services agreements, which require U.S. Cellular to provide customer, billing and network services to Sprint for a period of up to 24 months after the May 16, 2013 closing date. Sprint will reimburse U.S. Cellular for providing such services at an amount equal to U.S. Cellular's estimated costs, including applicable overhead allocations. These services were substantially complete as of March 31, 2014. In addition, these agreements require Sprint to reimburse U.S. Cellular up to $200 million (the “Sprint Cost Reimbursement”) for certain network decommissioning costs, network site lease rent and termination costs, network access termination costs, and employee termination benefits for specified engineering employees. It is estimated that up to $175 million of the Sprint Cost Reimbursement will be recorded in (Gain) loss on sale of business and other exit costs, net and up to $25 million of the Sprint Cost Reimbursement will be recorded in System operations in the Consolidated Statement of Operations. For the three months ended March 31, 2014, $11.3 million of the Sprint Cost Reimbursement had been received and recorded in Cash received from divestitures in the Consolidated Statement of Cash Flows. | ||||||||||||||||||||
Financial impacts of the Divestiture Transaction are classified in the Consolidated Statement of Operations within Operating income. The table below describes the amounts U.S. Cellular has recognized and expects to recognize in the Consolidated Statement of Operations between the date the Purchase and Sale Agreement was signed and the end of the transition services period. | ||||||||||||||||||||
(Dollars in thousands) | Expected Period of Recognition | Projected Range | Cumulative Amount Recognized as of March 31, 2014 | Actual Amount Recognized Three Months Ended March 31, 2014 | Actual Amount Recognized Three Months Ended March 31, 2013 | |||||||||||||||
(Gain) loss on sale of business and other exit costs, net | ||||||||||||||||||||
Proceeds from Sprint | ||||||||||||||||||||
Purchase price | 2013 | $ | -480,000 | $ | -480,000 | $ | -480,000 | $ | - | $ | - | |||||||||
Sprint Cost Reimbursement | 2013-2015 | -120,000 | -175,000 | -92,272 | -44,631 | - | ||||||||||||||
Net assets transferred | 2013 | 213,593 | 213,593 | 213,593 | - | - | ||||||||||||||
Non-cash charges for the write-off and write-down of property under construction and related assets | 2012-2014 | 10,000 | 15,000 | 11,018 | 343 | 222 | ||||||||||||||
Employee related costs including severance, retention and outplacement | 2012-2014 | 12,000 | 18,000 | 14,200 | -62 | 3,050 | ||||||||||||||
Contract termination costs | 2012-2015 | 100,000 | 130,000 | 96,671 | 37,087 | 2,900 | ||||||||||||||
Transaction costs | 2012-2014 | 5,000 | 7,000 | 5,774 | 209 | 918 | ||||||||||||||
Total (Gain) loss on sale of business and other exit costs, net | $ | -259,407 | $ | -271,407 | $ | -231,016 | $ | -7,054 | $ | 7,090 | ||||||||||
Depreciation, amortization and accretion expense | ||||||||||||||||||||
Incremental depreciation, amortization and accretion, net of salvage values | 2012-2014 | 210,000 | 220,000 | 211,656 | 13,085 | 38,046 | ||||||||||||||
(Increase) decrease in Operating income | $ | -49,407 | $ | -51,407 | $ | -19,360 | $ | 6,031 | $ | 45,136 | ||||||||||
Incremental depreciation, amortization and accretion, net of salvage values represents amounts recorded in the specified time periods as a result of a change in estimate for the remaining useful life and salvage value of certain assets and a change in estimate which accelerated the settlement dates of certain asset retirement obligations in conjunction with the Divestiture Transaction. Specifically, for the periods indicated, this is estimated depreciation, amortization and accretion recorded on assets and liabilities of the Divestiture Markets after the execution of the Purchase and Sale Agreement on November 6, 2012 less depreciation, amortization and accretion that would have been recorded on such assets and liabilities in the normal course, absent the Divestiture Transaction. | ||||||||||||||||||||
As a result of the transaction, U.S. Cellular recognized the following amounts in the Consolidated Balance Sheet: | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
(Dollars in thousands) | Balance December 31, 2013 | Costs Incurred | Cash Settlements (1) | Adjustments (2) | Balance March 31, 2014 | |||||||||||||||
Accrued compensation | ||||||||||||||||||||
Employee related costs including severance, retention, outplacement | $ | 2,053 | $ | 169 | $ | -701 | $ | -231 | $ | 1,290 | ||||||||||
Other current liabilities | ||||||||||||||||||||
Contract termination costs | $ | 13,992 | $ | 12,673 | $ | -5,950 | $ | 792 | $ | 21,507 | ||||||||||
Other deferred liabilities and credits | ||||||||||||||||||||
Contract termination costs | $ | 30,849 | $ | 24,073 | $ | -1,924 | $ | -8,614 | $ | 44,384 | ||||||||||
-1 | Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows. | |||||||||||||||||||
-2 | Adjustment to liability represents changes to previously accrued amounts. | |||||||||||||||||||
Other Acquisitions, Divestitures and Exchanges | ||||||||||||||||||||
On March 5, 2014, U.S. Cellular sold the majority of its St. Louis area non-operating market license for $92.3 million. A gain of $75.8 million was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations for the three months ended March 31, 2014. | ||||||||||||||||||||
On February 14, 2014, U.S. Cellular completed an exchange whereby U.S. Cellular received one E block PCS spectrum license covering Milwaukee, WI in exchange for one D block PCS spectrum license covering Milwaukee, WI. The exchange of licenses provided U.S. Cellular with spectrum to meet anticipated future capacity and coverage requirements. No cash, customers, network assets, other assets or liabilities were included in the exchange. As a result of this transaction, U.S. Cellular recognized a gain of $15.7 million, representing the difference between the $15.9 million fair value of the license surrendered, calculated using a market approach valuation method, and the $0.2 million carrying value of the license surrendered. This gain was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations for the three months ended March 31, 2014. |
Intangible_Assets
Intangible Assets | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Disclosure Text Block | ' | |||||||
Intangible Assets | ' | |||||||
6. Intangible Assets | ||||||||
Changes in U.S. Cellular's Licenses for the three months ended March 31, 2014 and 2013 are presented below. There were no significant changes to Goodwill during the periods presented. | ||||||||
Licenses | ||||||||
31-Mar-14 | 31-Mar-13 | |||||||
(Dollars in thousands) | ||||||||
Balance, beginning of period | $ | 1,401,126 | $ | 1,456,794 | ||||
Acquisitions | 9,100 | 14,150 | ||||||
Exchanges, net | 15,719 | - | ||||||
Balance, end of period | $ | 1,425,945 | $ | 1,470,944 |
Investment_in_Unconsolidated_E
Investment in Unconsolidated Entities | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Disclosure Text Block | ' | ||||||
Investment in Unconsolidated Entities | ' | ||||||
7. Investments in Unconsolidated Entities | |||||||
Investments in unconsolidated entities consist of amounts invested in wireless entities in which U.S. Cellular holds a noncontrolling interest. These investments are accounted for using either the equity or cost method. | |||||||
The following table, which is based on information provided in part by third parties, summarizes the combined results of operations of U.S. Cellular’s equity method investments. | |||||||
Three Months Ended March 31, | |||||||
2014 | 2013 | ||||||
(Dollars in thousands) | |||||||
Revenues | $ | 1,620,402 | $ | 1,471,192 | |||
Operating expenses | 1,137,209 | 1,034,624 | |||||
Operating income | 483,193 | 436,568 | |||||
Other income, net | 1,764 | 598 | |||||
Net income | $ | 484,957 | $ | 437,166 | |||
NY1 & NY2 Deconsolidation | |||||||
U.S. Cellular holds a 60.00% interest in St. Lawrence Seaway RSA Cellular Partnership (“NY1”) and a 57.14% interest in New York RSA 2 Cellular Partnership (“NY2”) (together with NY1, the “Partnerships”). The remaining interests in the Partnerships are held by Cellco Partnership d/b/a Verizon Wireless (“Verizon Wireless”). Prior to April 3, 2013, because U.S. Cellular owned a greater than 50% interest in each of these Partnerships and based on U.S. Cellular's rights under the Partnership Agreements, U.S. Cellular consolidated the financial results of these Partnerships in accordance with GAAP. | |||||||
On April 3, 2013, U.S. Cellular entered into an agreement with Verizon Wireless relating to the Partnerships. The agreement amends the Partnership Agreements in several ways which provide Verizon Wireless with substantive participating rights that allow Verizon Wireless to make decisions that are in the ordinary course of business of the Partnerships and which are significant to directing and executing the activities of the business. Accordingly, as required by GAAP, U.S. Cellular deconsolidated the Partnerships effective as of April 3, 2013 and thereafter reported them as equity method investments in its consolidated financial statements (“NY1 & NY2 Deconsolidation”). After the NY1 & NY2 Deconsolidation, U.S. Cellular retained the same ownership percentages in the Partnerships and continues to report the same percentages of income from the Partnerships, which are recorded in Equity in earnings of unconsolidated entities in the Consolidated Statement of Operations. | |||||||
Variable_Interest_Entities
Variable Interest Entities | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Disclosure Text Block | ' | |||||||
Variable Interest Entities | ' | |||||||
8. Variable Interest Entities (VIEs) | ||||||||
U.S. Cellular consolidates variable interest entities in which it has a controlling financial interest and is the primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact economic performance and (b) the obligation to absorb VIE losses and the right to receive benefits that are significant to the VIE. U.S. Cellular reviews these criteria initially at the time it enters into agreements and subsequently when reconsideration events occur. | ||||||||
Consolidated VIEs | ||||||||
As of March 31, 2014, U.S. Cellular holds a variable interest in and consolidates the following VIEs under GAAP: | ||||||||
Aquinas Wireless L.P. (“Aquinas Wireless”); and | ||||||||
King Street Wireless L.P. (“King Street Wireless”) and King Street Wireless, Inc., the general partner of King Street Wireless. | ||||||||
The power to direct the activities that most significantly impact the economic performance of Aquinas Wireless and King Street Wireless (collectively, the “limited partnerships”) is shared. Specifically, the general partner of these VIEs has the exclusive right to manage, operate and control the limited partnerships and make all decisions to carry on the business of the partnerships; however, the general partner of each partnership needs consent of the limited partner, a U.S. Cellular subsidiary, to sell or lease certain licenses, to make certain large expenditures, admit other partners or liquidate the limited partnerships. Although the power to direct the activities of the VIEs is shared, U.S. Cellular has a disproportionate level of exposure to the variability associated with the economic performance of the VIEs, indicating that U.S. Cellular is the primary beneficiary of the VIEs in accordance with GAAP. Accordingly, these VIEs are consolidated. | ||||||||
The following table presents the classification of the consolidated VIEs' assets and liabilities in U.S. Cellular's Consolidated Balance Sheet. | ||||||||
31-Mar-14 | 31-Dec-13 | |||||||
(Dollars in thousands) | ||||||||
Assets | ||||||||
Cash and cash equivalents | $ | 2,325 | $ | 2,076 | ||||
Other current assets | 1,126 | 1,184 | ||||||
Licenses | 310,475 | 310,475 | ||||||
Property, plant and equipment, net | 16,940 | 18,600 | ||||||
Other assets and deferred charges | 511 | 511 | ||||||
Total assets | $ | 331,377 | $ | 332,846 | ||||
Liabilities | ||||||||
Current liabilities | $ | 135 | $ | 46 | ||||
Deferred liabilities and credits | 2,122 | 3,139 | ||||||
Total liabilities | $ | 2,257 | $ | 3,185 | ||||
Other Related Matters | ||||||||
Aquinas Wireless and King Street Wireless were formed to participate in Federal Communications Commission (“FCC”) auctions of wireless spectrum and to fund, establish, and provide wireless service with respect to any FCC licenses won in the auctions. As such, these entities have risks similar to those described in the “Risk Factors” in U.S. Cellular's Form 10-K for the year ended December 31, 2013. | ||||||||
U.S. Cellular may agree to make additional capital contributions and/or advances to Aquinas Wireless and King Street Wireless and/or to their general partners to provide additional funding for the development of licenses granted in various auctions. U.S. Cellular may finance such amounts with a combination of cash on hand, borrowings under its revolving credit agreement and/or long-term debt. There is no assurance that U.S. Cellular will be able to obtain additional financing on commercially reasonable terms or at all to provide such financial support. | ||||||||
There were no capital contributions or advances made to Aquinas Wireless or King Street Wireless or their general partners in the three months ended March 31, 2014 and 2013. | ||||||||
U.S. Cellular currently provides 4G LTE service in conjunction with King Street Wireless. Aquinas Wireless is still in the process of developing long-term business plans. | ||||||||
Noncontrolling_Interests
Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2014 | |
Disclosure Text Block | ' |
Noncontrolling Interests | ' |
9. Noncontrolling Interests | |
U.S. Cellular's consolidated financial statements include certain noncontrolling interests that meet the GAAP definition of mandatorily redeemable financial instruments. These mandatorily redeemable noncontrolling interests represent interests held by third parties in consolidated partnerships and limited liability companies (“LLCs”), where the terms of the underlying partnership or LLC agreement provide for a defined termination date at which time the assets of the subsidiary are to be sold, the liabilities are to be extinguished and the remaining net proceeds are to be distributed to the noncontrolling interest holders and U.S. Cellular in accordance with the respective partnership and LLC agreements. The termination dates of these mandatorily redeemable noncontrolling interests range from 2085 to 2107. | |
The estimated aggregate amount that would be due and payable to settle all of these noncontrolling interests (“settlement value”), assuming an orderly liquidation of the finite-lived consolidated partnerships and LLCs on March 31, 2014, net of estimated liquidation costs, is $21.9 million. This amount excludes redemption amounts recorded in Noncontrolling interests with redemption features in the Consolidated Balance Sheet. The estimate of settlement value was based on certain factors and assumptions which are subjective in nature. Changes in those factors and assumptions could result in a materially larger or smaller settlement amount. U.S. Cellular currently has no plans or intentions relating to the liquidation of any of the related partnerships or LLCs prior to their scheduled termination dates. The corresponding carrying value of the mandatorily redeemable noncontrolling interests in finite-lived consolidated partnerships and LLCs at March 31, 2014 was $14.4 million, and is included in Noncontrolling interests in the Consolidated Balance Sheet. The excess of the aggregate settlement value over the aggregate carrying value of these mandatorily redeemable noncontrolling interests is due primarily to the unrecognized appreciation of the noncontrolling interest holders' share of the underlying net assets in the consolidated partnerships and LLCs. Neither the noncontrolling interest holders' share, nor U.S. Cellular's share, of the appreciation of the underlying net assets of these subsidiaries is reflected in the consolidated financial statements. | |
Common_Share_Repurchases
Common Share Repurchases | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Disclosure Text Block | ' | ||||||
Common Share Repurchases | ' | ||||||
10. Common Share Repurchases | |||||||
On November 17, 2009, the Board of Directors of U.S. Cellular authorized the repurchase of up to 1,300,000 Common Shares on an annual basis beginning in 2009 and continuing each year thereafter, on a cumulative basis. These purchases will be made pursuant to open market purchases, block purchases, private purchases, or otherwise, depending on market prices and other conditions. This authorization does not have an expiration date. | |||||||
Share repurchases made under this authorization were as follows: | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2014 | 2013 | ||||||
(Dollars amounts and shares in thousands) | |||||||
Number of shares | 59 | 496 | |||||
Average cost per share | $ | 39.13 | $ | 37.16 | |||
Amount | $ | 2,300 | $ | 18,425 |
Supplemental_Cash_Flow_Disclos
Supplemental Cash Flow Disclosures | 3 Months Ended |
Mar. 31, 2014 | |
Disclosure Text Block | ' |
Supplemental Cash Flow Disclosures | ' |
11. Supplemental Cash Flow Disclosures | |
U.S. Cellular and several of its wholly-owned subsidiaries participated in FCC Auction 901 and were winning bidders in eligible areas within 10 states and will receive up to $40.1 million in one-time support from the Mobility Fund. These funds will reduce the carrying amount of the assets to which they relate or will offset operating expenses. U.S. Cellular has received $13.4 million in support funds as of March 31, 2014, of which $9.4 million is included as a component of Other assets and deferred charges in the Consolidated Balance Sheet and $4.0 million reduced the carrying amount of the assets to which they relate, which are included in Property, plant and equipment in the Consolidated Balance Sheet. |
Fair_Value_Measurements_Table
Fair Value Measurements (Table) | 3 Months Ended | ||||||||||||||
Mar. 31, 2014 | |||||||||||||||
Fair Value Disclosures | ' | ||||||||||||||
Fair value measurements | ' | ||||||||||||||
Level within the Fair Value Hierarchy | 31-Mar-14 | 31-Dec-13 | |||||||||||||
Book Value | Fair Value | Book Value | Fair Value | ||||||||||||
(Dollars in thousands) | |||||||||||||||
Cash and cash equivalents | 1 | $ | 398,541 | $ | 398,541 | $ | 342,065 | $ | 342,065 | ||||||
Short-term investments | |||||||||||||||
U.S. Treasury Notes | 1 | 40,056 | 40,056 | 50,104 | 50,104 | ||||||||||
Long-term debt | |||||||||||||||
6.95% Senior Notes | 1 | 342,000 | 347,062 | 342,000 | 309,852 | ||||||||||
6.7% Senior Notes | 2 | 532,515 | 531,869 | 532,449 | 507,697 |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Earnings Per Share | ' | ||||||
Earnings per share | ' | ||||||
Three Months Ended | |||||||
March 31, | |||||||
2014 | 2013 | ||||||
(Dollars and shares in thousands, except per share amounts) | |||||||
Net income attributable to U.S. Cellular shareholders | $ | 19,482 | $ | 4,914 | |||
Weighted average number of shares used in basic earnings per share | 84,213 | 83,838 | |||||
Effects of dilutive securities: | |||||||
Stock options | 203 | 151 | |||||
Restricted stock units | 649 | 599 | |||||
Weighted average number of shares used in diluted earnings per share | 85,065 | 84,588 | |||||
Basic earnings per share attributable to U.S. Cellular shareholders | $ | 0.23 | $ | 0.06 | |||
Diluted earnings per share attributable to U.S. Cellular shareholders | $ | 0.23 | $ | 0.06 | |||
Summary of antidilutive shares | ' | ||||||
Three Months Ended | |||||||
March 31, | |||||||
2014 | 2013 | ||||||
(Shares in thousands) | |||||||
Stock options | 1,276 | 2,226 | |||||
Restricted stock units | - | 1 |
Acquisitions_Divestitures_and_1
Acquisitions, Divestitures and Exchanges (Tables) | 3 Months Ended | |||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||
Divestiture Financial Impacts | ' | |||||||||||||||||||
Business divestiture financial impacts | ' | |||||||||||||||||||
(Dollars in thousands) | Expected Period of Recognition | Projected Range | Cumulative Amount Recognized as of March 31, 2014 | Actual Amount Recognized Three Months Ended March 31, 2014 | Actual Amount Recognized Three Months Ended March 31, 2013 | |||||||||||||||
(Gain) loss on sale of business and other exit costs, net | ||||||||||||||||||||
Proceeds from Sprint | ||||||||||||||||||||
Purchase price | 2013 | $ | -480,000 | $ | -480,000 | $ | -480,000 | $ | - | $ | - | |||||||||
Sprint Cost Reimbursement | 2013-2015 | -120,000 | -175,000 | -92,272 | -44,631 | - | ||||||||||||||
Net assets transferred | 2013 | 213,593 | 213,593 | 213,593 | - | - | ||||||||||||||
Non-cash charges for the write-off and write-down of property under construction and related assets | 2012-2014 | 10,000 | 15,000 | 11,018 | 343 | 222 | ||||||||||||||
Employee related costs including severance, retention and outplacement | 2012-2014 | 12,000 | 18,000 | 14,200 | -62 | 3,050 | ||||||||||||||
Contract termination costs | 2012-2015 | 100,000 | 130,000 | 96,671 | 37,087 | 2,900 | ||||||||||||||
Transaction costs | 2012-2014 | 5,000 | 7,000 | 5,774 | 209 | 918 | ||||||||||||||
Total (Gain) loss on sale of business and other exit costs, net | $ | -259,407 | $ | -271,407 | $ | -231,016 | $ | -7,054 | $ | 7,090 | ||||||||||
Depreciation, amortization and accretion expense | ||||||||||||||||||||
Incremental depreciation, amortization and accretion, net of salvage values | 2012-2014 | 210,000 | 220,000 | 211,656 | 13,085 | 38,046 | ||||||||||||||
(Increase) decrease in Operating income | $ | -49,407 | $ | -51,407 | $ | -19,360 | $ | 6,031 | $ | 45,136 | ||||||||||
As a result of the transaction, U.S. Cellular recognized the following amounts in the Consolidated Balance Sheet: | ||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||
(Dollars in thousands) | Balance December 31, 2013 | Costs Incurred | Cash Settlements (1) | Adjustments (2) | Balance March 31, 2014 | |||||||||||||||
Accrued compensation | ||||||||||||||||||||
Employee related costs including severance, retention, outplacement | $ | 2,053 | $ | 169 | $ | -701 | $ | -231 | $ | 1,290 | ||||||||||
Other current liabilities | ||||||||||||||||||||
Contract termination costs | $ | 13,992 | $ | 12,673 | $ | -5,950 | $ | 792 | $ | 21,507 | ||||||||||
Other deferred liabilities and credits | ||||||||||||||||||||
Contract termination costs | $ | 30,849 | $ | 24,073 | $ | -1,924 | $ | -8,614 | $ | 44,384 | ||||||||||
-1 | Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows. | |||||||||||||||||||
-2 | Adjustment to liability represents changes to previously accrued amounts. |
Intangible_Assets_Tables
Intangible Assets (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Licenses | ' | |||||||
Licenses | ' | |||||||
Licenses | ||||||||
31-Mar-14 | 31-Mar-13 | |||||||
(Dollars in thousands) | ||||||||
Balance, beginning of period | $ | 1,401,126 | $ | 1,456,794 | ||||
Acquisitions | 9,100 | 14,150 | ||||||
Exchanges, net | 15,719 | - | ||||||
Balance, end of period | $ | 1,425,945 | $ | 1,470,944 |
Investment_in_Unconsolidated_E1
Investment in Unconsolidated Entities (Tables) | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Equity Method Investment, Summarized Financial Information | ' | ||||||
Equity method investments, summarized results of operations | ' | ||||||
The following table, which is based on information provided in part by third parties, summarizes the combined results of operations of U.S. Cellular’s equity method investments. | |||||||
Three Months Ended March 31, | |||||||
2014 | 2013 | ||||||
(Dollars in thousands) | |||||||
Revenues | $ | 1,620,402 | $ | 1,471,192 | |||
Operating expenses | 1,137,209 | 1,034,624 | |||||
Operating income | 483,193 | 436,568 | |||||
Other income, net | 1,764 | 598 | |||||
Net income | $ | 484,957 | $ | 437,166 |
Variable_Interest_Entities_VIE
Variable Interest Entities VIEs (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Variable Interest Entities VIEs | ' | |||||||
Consolidated VIE assets and liabilities | ' | |||||||
31-Mar-14 | 31-Dec-13 | |||||||
(Dollars in thousands) | ||||||||
Assets | ||||||||
Cash and cash equivalents | $ | 2,325 | $ | 2,076 | ||||
Other current assets | 1,126 | 1,184 | ||||||
Licenses | 310,475 | 310,475 | ||||||
Property, plant and equipment, net | 16,940 | 18,600 | ||||||
Other assets and deferred charges | 511 | 511 | ||||||
Total assets | $ | 331,377 | $ | 332,846 | ||||
Liabilities | ||||||||
Current liabilities | $ | 135 | $ | 46 | ||||
Deferred liabilities and credits | 2,122 | 3,139 | ||||||
Total liabilities | $ | 2,257 | $ | 3,185 |
Common_Share_Repurchases_Table
Common Share Repurchases (Table) | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Common Share Repurchases | ' | ||||||
Share repurchases | ' | ||||||
Three Months Ended | |||||||
March 31, | |||||||
2014 | 2013 | ||||||
(Dollars amounts and shares in thousands) | |||||||
Number of shares | 59 | 496 | |||||
Average cost per share | $ | 39.13 | $ | 37.16 | |||
Amount | $ | 2,300 | $ | 18,425 |
Basis_of_Presentation_Details
Basis of Presentation (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Basis of Presentation | ' | ' |
TDS ownership of U.S. Cellular | 84.00% | ' |
Amounts recorded gross in revenues that are billed to customers and remitted to governmental authorities | $26.40 | $32.10 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Fair Value | Book Value | Book Value | Book Value | Book Value | Book Value | Book Value | Book Value | Book Value | 6.7% Senior Notes | ||||
Level 1 | Level 1 | Level 1 | Level 1 | Level 2 | Level 2 | U.S. Treasury Notes | U.S. Treasury Notes | 6.95% Senior Notes | 6.95% Senior Notes | 6.7% Senior Notes | 6.7% Senior Notes | U.S. Treasury Notes | U.S. Treasury Notes | ||||||||
6.95% Senior Notes | 6.95% Senior Notes | 6.7% Senior Notes | 6.7% Senior Notes | Level 1 | Level 1 | ||||||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | $398,541 | $342,065 | $419,696 | $378,358 | $398,541 | $342,065 | ' | ' | ' | ' | ' | ' | $398,541 | $342,065 | ' | ' | ' | ' | ' | ' | ' |
Short-term investments | 40,056 | 50,104 | ' | ' | ' | ' | ' | ' | ' | ' | 40,056 | 50,104 | ' | ' | ' | ' | ' | ' | 40,056 | 50,104 | ' |
Long-term debt | ' | ' | ' | ' | ' | ' | $347,062 | $309,852 | $531,869 | $507,697 | ' | ' | ' | ' | $342,000 | $342,000 | $532,515 | $532,449 | ' | ' | ' |
Fair value assumption, interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.91% |
Income_Taxes_Details
Income Taxes (Details) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Income Tax Disclosure | ' | ' |
Effective income tax rate | 40.60% | 40.80% |
Earnings_Per_Share_Details
Earnings Per Share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |
Share data in Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Earnings per share | ' | ' | ' |
Net income attributable to U.S. Cellular shareholders | $19,482,000 | $4,914,000 | ' |
Weighted average number of shares used in basic earnings per share | ' | ' | ' |
Weighted average number of shares used in basic earnings per share | 84,213 | 83,838 | ' |
Effect of dilutive securities: | ' | ' | ' |
Stock options | 203 | 151 | ' |
Restricted stock units | 649 | 599 | ' |
Weighted average number of shares used in diluted earnings per share | 85,065 | 84,588 | ' |
Earnings per share, Other disclosures | ' | ' | ' |
Basic earnings per share attributable to U.S. Cellular shareholders | $0.23 | $0.06 | ' |
Diluted earnings per share attributable to U.S. Cellular shareholders | $0.23 | $0.06 | ' |
Dividend payable date | 25-Jun-13 | ' | ' |
Dividend date of record | 11-Jun-13 | ' | ' |
Series A Common and Common Shares, dividends per share paid | ' | ' | $5.75 |
Series A Common and Common Shares, dividends paid | ' | ' | $482,300,000 |
Stock Options | ' | ' | ' |
Earnings per share, Other disclosures | ' | ' | ' |
Antidilutive securities | 1,276 | 2,226 | ' |
Restricted Stock Units | ' | ' | ' |
Earnings per share, Other disclosures | ' | ' | ' |
Antidilutive securities | ' | 1 | ' |
Acquisitions_Divestitures_and_2
Acquisitions, Divestitures and Exchanges, divestitures (Details) (USD $) | 3 Months Ended | 17 Months Ended | 3 Months Ended | 12 Months Ended | 26 Months Ended | 38 Months Ended | 3 Months Ended | 12 Months Ended | 26 Months Ended | 38 Months Ended | 17 Months Ended | 12 Months Ended | 3 Months Ended | 36 Months Ended | 3 Months Ended | 17 Months Ended | 36 Months Ended | 3 Months Ended | |||||||||||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |||
Divestiture transaction | Divestiture transaction | Divestiture transaction | St. Louis | Minimum | Minimum | Minimum | Maximum | Maximum | Maximum | Maximum | Purchase price | Purchase price | Purchase price | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Sprint Cost Reimbursement | Employee related costs including severance, retention and outplacement | Contract termination costs | Contract termination costs | ||||||
Divestiture transaction | Expected event | Expected event | Divestiture transaction | Divestiture transaction | Expected event | Expected event | Divestiture transaction | Minimum | Maximum | Divestiture transaction | Maximum | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | (Gain) loss on sale of business and other exit costs, net | System operations | Divestiture transaction | Other current liabilities | Other deferred liabilities and credits | ||||||||||
Divestiture transaction | Divestiture transaction | Divestiture transaction | Divestiture transaction | Divestiture transaction | Divestiture transaction | Expected event | Divestiture transaction | Divestiture transaction | Minimum | Maximum | Maximum | Divestiture transaction | Divestiture transaction | ||||||||||||||||
Divestiture transaction | Expected event | Expected event | Expected event | ||||||||||||||||||||||||||
Divestiture transaction | Divestiture transaction | Divestiture transaction | |||||||||||||||||||||||||||
Divestitures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Business divestiture date | ' | ' | 16-May-13 | ' | ' | 5-Mar-14 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Business divestiture description | ' | ' | 'On November 6, 2012, U.S. Cellular entered into a Purchase and Sale Agreement with subsidiaries of Sprint Corp., fka Sprint Nextel Corporation (“Sprint”). Pursuant to the Purchase and Sale Agreement, on May 16, 2013, U.S. Cellular transferred customers and certain PCS license spectrum to Sprint in U.S. Cellular’s Chicago, central Illinois, St. Louis and certain Indiana/Michigan/Ohio markets (“Divestiture Markets”) in consideration for $480 million in cash. The Purchase and Sale Agreement also contemplated certain other agreements, together with the Purchase and Sale Agreement collectively referred to as the “Divestiture Transaction.” Pursuant to the Purchase and Sale Agreement, U.S. Cellular and Sprint also entered into certain other agreements, including customer and network transition services agreements, which require U.S. Cellular to provide customer, billing and network services to Sprint for a period of up to 24 months after the May 16, 2013 closing date. Sprint will reimburse U.S. Cellular for providing such services at an amount equal to U.S. Cellular’s estimated costs, including applicable overhead allocations. These services were substantially complete as of March 31, 2014. In addition, these agreements require Sprint to reimburse U.S. Cellular up to $200 million (the “Sprint Cost Reimbursement”) for certain network decommissioning costs, network site lease rent and termination costs, network access termination costs, and employee termination benefits for specified engineering employees. | ' | ' | 'On March 5, 2014, U.S. Cellular sold the majority of its St. Louis area non-operating market license for $92.3 million. A gain of $75.8 million was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations for the three months ended March 31, 2014. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Business divestiture agreement date | ' | ' | 6-Nov-12 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Transition services agreement duration | ' | ' | ' | ' | ' | ' | ' | ' | ' | '24M | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
(Increase) decrease in Operating Income | ($7,825) | ($1,466) | $6,031 | $45,136 | ($19,360) | ' | ' | ' | ($49,407) | ' | ' | ' | ($51,407) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
(Gain) loss on license sales and exchanges | -91,446 | ' | ' | ' | ' | -75,800 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Divestiture Financial Impacts | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Cash received from divestitures | -103,042 | ' | ' | ' | ' | -92,300 | ' | ' | ' | ' | ' | ' | ' | -480,000 | -480,000 | -480,000 | -11,300 | -200,000 | -44,631 | -92,272 | -120,000 | -175,000 | -25,000 | ' | ' | ' | |||
Net assets transferred | ' | ' | ' | ' | 213,593 | ' | 213,593 | ' | ' | ' | 213,593 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Non-cash charges for the write-off and write-down of property under construction and related assets | ' | ' | 343 | 222 | 11,018 | ' | ' | 10,000 | ' | ' | ' | 15,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Employee related costs including severance, retention and outplacement | ' | ' | -62 | 3,050 | 14,200 | ' | ' | 12,000 | ' | ' | ' | 18,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Contract termination costs | ' | ' | 37,087 | 2,900 | 96,671 | ' | ' | ' | 100,000 | ' | ' | ' | 130,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Transaction costs | ' | ' | 209 | 918 | 5,774 | ' | ' | 5,000 | ' | ' | ' | 7,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Total (Gain) loss on sale of business and other exit costs, net | -6,900 | 6,931 | -7,054 | 7,090 | -231,016 | ' | ' | ' | -259,407 | ' | ' | ' | -271,407 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Incremental depreciation, amortization and accretion, net of salvage values | 167,753 | 189,845 | 13,085 | 38,046 | 211,656 | ' | ' | 210,000 | ' | ' | ' | 220,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Balance Sheet rollforward | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Balance, beginning of period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,053 | 13,992 | 30,849 | |||
Costs incurred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 169 | 12,673 | 24,073 | |||
Cash settlements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -701 | [1] | -5,950 | [1] | -1,924 | [1] |
Adjustments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -231 | [2] | 792 | [2] | -8,614 | [2] |
Balance, end of period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,290 | $21,507 | $44,384 | |||
[1] | Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows. | ||||||||||||||||||||||||||||
[2] | Adjustment to liability represents changes to previously accrued amounts. |
Acquisitions_Divestitures_and_3
Acquisitions, Divestitures and Exchanges, exchanges (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Dec. 31, 2013 | |
Exchanges | ' | ' |
(Gain) loss on license sales and exchanges | ($91,446,000) | ' |
Carrying value | 1,425,945,000 | 1,401,126,000 |
Spectrum exchange | ' | ' |
Exchanges | ' | ' |
Agreement date | 14-Feb-14 | ' |
Asset exchange description | 'On February 14, 2014, U.S. Cellular completed an exchange whereby U.S. Cellular received one E block PCS spectrum license covering Milwaukee, WI in exchange for one D block PCS spectrum license covering Milwaukee, WI. The exchange of licenses provided U.S. Cellular with spectrum to meet anticipated future capacity and coverage requirements. No cash, customers, network assets, other assets or liabilities were included in the exchange. As a result of this transaction, U.S. Cellular recognized a gain of $15.7 million, representing the difference between the $15.9 million fair value of the license surrendered, calculated using a market approach valuation method, and the $0.2 million carrying value of the license surrendered. This gain was recorded in (Gain) loss on license sales and exchanges in the Consolidated Statement of Operations for the three months ended March 31, 2014. | ' |
(Gain) loss on license sales and exchanges | -15,700,000 | ' |
Fair value | 15,900,000 | ' |
Carrying value | $200,000 | ' |
Asset exchange, valuation method | 'market approach valuation method | ' |
Intangible_Assets_Details
Intangible Assets (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Licenses | ' | ' |
Balance, beginning of period | $1,401,126 | $1,456,794 |
Acquisitions | 9,100 | 14,150 |
Exchanges, net | 15,719 | ' |
Balance, end of period | $1,425,945 | $1,470,944 |
Investments_in_Unconsolidated_
Investments in Unconsolidated Entities (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Equity method investments, combined income statements | ' | ' |
Revenues | $1,620,402 | $1,471,192 |
Operating expenses | 1,137,209 | 1,034,624 |
Operating income | 483,193 | 436,568 |
Other income, net | 1,764 | 598 |
Net income | $484,957 | $437,166 |
Investment_in_Unconsolidated_E2
Investment in Unconsolidated Entities, Deconsolidation (Details) | 3 Months Ended |
Mar. 31, 2014 | |
Deconsolidation of New York Partnerships | ' |
Deconsolidation description | 'On April 3, 2013, U.S. Cellular entered into an agreement with Verizon Wireless relating to the Partnerships. The agreement amends the Partnership Agreements in several ways which provide Verizon Wireless with substantive participating rights that allow Verizon Wireless to make decisions that are in the ordinary course of business of the Partnerships and which are significant to directing and executing the activities of the business. Accordingly, as required by GAAP, U.S. Cellular deconsolidated the Partnerships effective as of April 3, 2013 and thereafter reported them as equity method investments in its consolidated financial statements (“NY1 & NY2 Deconsolidation”). After the NY1 & NY2 Deconsolidation, U.S. Cellular retained the same ownership percentages in the Partnerships and continues to report the same percentages of income from the Partnerships, which are recorded in Equity in earnings of unconsolidated entities in the Consolidated Statement of Operations. |
St. Lawrence Seaway RSA Cellular Partnership | ' |
Deconsolidation of New York Partnerships | ' |
Ownership interest in equity method investment | 60.00% |
New York RSA 2 Cellular Partnership | ' |
Deconsolidation of New York Partnerships | ' |
Ownership interest in equity method investment | 57.14% |
St. Lawrence Seaway RSA Cellular Partnership and New York RSA 2 Cellular Partnership | ' |
Deconsolidation of New York Partnerships | ' |
Date of deconsolidation | 3-Apr-13 |
Variable_Interest_Entities_VIE1
Variable Interest Entities VIEs (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Assets | ' | ' | ' | ' |
Cash and cash equivalents | $398,541 | $342,065 | $419,696 | $378,358 |
Other current assets | 19,702 | 19,538 | ' | ' |
Licenses | 1,425,945 | 1,401,126 | ' | ' |
Property, plant and equipment, net | 2,776,220 | 2,856,520 | ' | ' |
Other assets and deferred charges | 132,536 | 117,735 | ' | ' |
Liabilities | ' | ' | ' | ' |
Current liabilities | 868,071 | 1,006,173 | ' | ' |
Variable Interest Entities (VIE's) | ' | ' | ' | ' |
Assets | ' | ' | ' | ' |
Cash and cash equivalents | 2,325 | 2,076 | ' | ' |
Other current assets | 1,126 | 1,184 | ' | ' |
Licenses | 310,475 | 310,475 | ' | ' |
Property, plant and equipment, net | 16,940 | 18,600 | ' | ' |
Other assets and deferred charges | 511 | 511 | ' | ' |
Total assets | 331,377 | 332,846 | ' | ' |
Liabilities | ' | ' | ' | ' |
Current liabilities | 135 | 46 | ' | ' |
Deferred liabilities and credits | 2,122 | 3,139 | ' | ' |
Total liabilities | $2,257 | $3,185 | ' | ' |
Noncontrolling_Interests_Detai
Noncontrolling Interests (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Redeemable noncontrolling interest | ' |
Termination date range of mandatorily redeemable noncontrolling interests - begin | '2085 |
Termination date range of mandatorily redeemable noncontrolling interests - end | '2107 |
Settlement value of mandatorily redeemable noncontrolling interests | $21.90 |
Carrying value of mandatorily redeemable noncontrolling interests | $14.40 |
Common_Share_Repurchases_Detai
Common Share Repurchases (Details) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Share repurchases | ' | ' |
Amount | $2,300 | $18,425 |
Treasury Shares | ' | ' |
Share repurchases | ' | ' |
Amount | 2,300 | 18,425 |
Common Shares | Treasury Shares | ' | ' |
Share repurchases | ' | ' |
Number of shares acquired | 59,000 | 496,000 |
Average cost per share | $39.13 | $37.16 |
Amount | $2,300 | $18,425 |
Common share repurchase authorization | 'On November 17, 2009, the Board of Directors of U.S. Cellular authorized the repurchase of up to 1,300,000 Common Shares on an annual basis beginning in 2009 and continuing each year thereafter, on a cumulative basis. These purchases will be made pursuant to open market purchases, block purchases, private purchases, or otherwise, depending on market prices and other conditions. This authorization does not have an expiration date. | ' |
Repurchase authorization, additional number of shares | 1,300,000 | ' |
Repurchase expiration | 'does not have an expiration date | ' |
Supplemental_Cash_Flow_Disclos1
Supplemental Cash Flow Disclosures (Details) (Auction 901 Mobility Funds, USD $) | Mar. 31, 2014 |
In Millions, unless otherwise specified | number |
Supplemental cash flow disclosures | ' |
FCC auction amount received | $13.40 |
FCC auction number of states won | 10 |
Other assets and deferred charges | ' |
Supplemental cash flow disclosures | ' |
FCC auction amount received | 9.4 |
Property, plant and equipment, net | ' |
Supplemental cash flow disclosures | ' |
FCC auction amount received | 4 |
Maximum | ' |
Supplemental cash flow disclosures | ' |
FCC auction amount received | $40.10 |