Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 10, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | ATLANTIC TELE NETWORK INC /DE | |
Entity Central Index Key | 879,585 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 16,406,436 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Current Assets: | ||
Cash and cash equivalents | $ 391,805 | $ 326,216 |
Restricted cash | 789 | 39,703 |
Accounts receivable, net of allowances of $11.3 million and $10.1 million, respectively | 47,693 | 52,873 |
Materials and supplies | 10,079 | 10,546 |
Deferred income taxes | 2,588 | 2,588 |
Prepayments and other current assets | 19,073 | 19,273 |
Assets of discontinued operations | 71 | 175 |
Total current assets | 472,098 | 451,374 |
Fixed Assets: | ||
Property, plant and equipment | 770,589 | 763,417 |
Less: accumulated depreciation | (408,157) | (393,835) |
Net fixed assets | 362,432 | 369,582 |
Telecommunication licenses, net | 43,778 | 44,090 |
Goodwill | 45,077 | 45,077 |
Trade name license, net | 417 | 417 |
Customer relationships, net | 1,270 | 1,496 |
Restricted cash | 5,388 | 5,475 |
Other assets | 6,695 | 7,519 |
Total assets | 937,155 | 925,030 |
Current Liabilities: | ||
Current portion of long-term debt | 6,231 | 6,083 |
Accounts payable and accrued liabilities | 50,985 | 61,737 |
Dividends payable | 4,666 | 4,631 |
Accrued taxes | 9,967 | 5,667 |
Advance payments and deposits | 8,400 | 7,898 |
Deferred income taxes | 199 | 213 |
Other current liabilities | 9,472 | 16,593 |
Liabilities of discontinued operations | 1,357 | 1,247 |
Total current liabilities | 91,277 | 104,069 |
Deferred income taxes | 31,232 | 30,366 |
Other long -term liabilities | 27,113 | 19,619 |
Long-term debt, excluding current portion | 29,649 | 32,794 |
Total liabilities | 179,271 | 186,848 |
Atlantic Tele-Network, Inc. Stockholders' Equity: | ||
Common stock, $0.01 par value per share; 50,000,000 shares authorized; 16,647,334 and 16,796,273 shares issued, respectively, and 15,925,748 and 16,406,436 shares outstanding, respectively | 166 | 166 |
Treasury stock, at cost; 721,586 and 749,837 shares, respectively | (17,504) | (15,549) |
Additional paid-in capital | 150,311 | 145,563 |
Retained earnings | 546,841 | 549,963 |
Accumulated other comprehensive loss | (2,893) | (2,921) |
Total Atlantic Tele-Network, Inc. stockholders' equity | 676,921 | 677,222 |
Non-controlling interests | 80,963 | 60,960 |
Total equity | 757,884 | 738,182 |
Total liabilities and equity | $ 937,155 | $ 925,030 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowances (in dollars) | $ 10.1 | $ 11.3 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 16,796,273 | 16,647,334 |
Common stock, shares outstanding | 16,406,436 | 15,925,748 |
Treasury stock, shares | 749,837 | 721,586 |
CONDENSED CONSOLIDATED INCOME S
CONDENSED CONSOLIDATED INCOME STATEMENTS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
REVENUE: | ||||
Total revenue | $ 90,326 | $ 83,269 | $ 175,670 | $ 158,443 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||||
Termination and access fees | 19,852 | 19,713 | 39,484 | 38,843 |
Engineering and operations | 7,668 | 6,922 | 15,586 | 13,980 |
Sales and marketing | 5,064 | 5,293 | 10,518 | 10,672 |
Equipment expense | 2,833 | 3,273 | 6,661 | 5,988 |
General and administrative | 14,391 | 13,185 | 28,813 | 25,828 |
Transaction-related charges | 137 | 346 | 316 | 367 |
Depreciation and amortization | 14,472 | 12,930 | 29,223 | 24,910 |
Gain on disposition of long-lived assets | (2,823) | (2,823) | ||
Total operating expenses | 61,594 | 61,662 | 127,778 | 120,588 |
Income from operations | 28,732 | 21,607 | 47,892 | 37,855 |
OTHER INCOME (EXPENSE): | ||||
Interest expense, net | (742) | (20) | (1,359) | (207) |
Loss on deconsolidation of subsidiary (Note 5) | (19,937) | |||
Other income (expense), net | 36 | 73 | 61 | (36) |
Other income (expense), net | (706) | 53 | (21,235) | (243) |
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 28,026 | 21,660 | 26,657 | 37,612 |
Income taxes | 13,008 | 7,338 | 12,521 | 12,890 |
INCOME (LOSS) FROM CONTINUING OPERATIONS | 15,018 | 14,322 | 14,136 | 24,722 |
Income from discontinued operations, net of tax | 390 | |||
NET INCOME (LOSS) | 15,018 | 14,322 | 14,526 | 24,722 |
Net loss attributable to non-controlling interests, net of tax: | ||||
Net income attributable to non-controlling interests, net of tax | (5,568) | (2,809) | (8,345) | (5,368) |
NET INCOME (LOSS) ATTRIBUTABLE TO ATLANTIC TELE-NETWORK, INC. STOCKHOLDERS | $ 9,450 | $ 11,513 | $ 6,181 | $ 19,354 |
NET INCOME PER WEIGHTED AVERAGE BASIC SHARE ATTRIBUTABLE TO ATLANTIC TELE-NETWORK, INC. STOCKHOLDERS: | ||||
Continuing operations (in dollars per share) | $ 0.59 | $ 0.72 | $ 0.36 | $ 1.22 |
Discontinued operations (in dollars per share) | 0.02 | |||
Total (in dollars per share) | 0.59 | 0.72 | 0.38 | 1.22 |
NET INCOME PER WEIGHTED AVERAGE DILUTED SHARE ATTRIBUTABLE TO ATLANTIC TELE-NETWORK, INC. STOCKHOLDERS: | ||||
Continued operations (in dollars per share) | 0.59 | 0.72 | 0.36 | 1.21 |
Discontinued operations (in dollars per share) | 0.02 | |||
Total (in dollars per share) | $ 0.59 | $ 0.72 | $ 0.38 | $ 1.21 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||
Basic (in shares) | 16,038 | 15,915 | 15,988 | 15,873 |
Diluted (in shares) | 16,150 | 16,023 | 16,109 | 15,986 |
DIVIDENDS PER SHARE APPLICABLE TO COMMON STOCK (in dollars per share) | $ 0.29 | $ 0.27 | $ 0.58 | $ 0.54 |
U.S. Wireless | ||||
REVENUE: | ||||
Total revenue | $ 40,103 | $ 37,456 | $ 75,946 | $ 65,848 |
International wireless | ||||
REVENUE: | ||||
Total revenue | 20,223 | 22,422 | 41,395 | 45,570 |
Wireline | ||||
REVENUE: | ||||
Total revenue | 22,089 | 21,283 | 42,681 | 42,813 |
Renewable energy | ||||
REVENUE: | ||||
Total revenue | 5,290 | 10,579 | ||
Equipment and other | ||||
REVENUE: | ||||
Total revenue | $ 2,621 | $ 2,108 | $ 5,069 | $ 4,212 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income (loss) | $ 14,526 | $ 24,722 |
Other comprehensive income: | ||
Foreign currency translation adjustment | 28 | |
Other comprehensive income, net of tax | 28 | |
Total comprehensive income | 14,554 | 24,722 |
Less: Comprehensive income attributable to non-controlling interests | (8,345) | (5,368) |
Comprehensive income (loss) attributable to Atlantic Tele-Network, Inc. | $ 6,209 | $ 19,354 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 14,526 | $ 24,722 |
Adjustments to reconcile net income (loss) to net cash flows provided by operating activities: | ||
Depreciation and amortization | 29,223 | 24,910 |
Provision for doubtful accounts | 237 | 256 |
Amortization of debt discount and debt issuance costs | 283 | 48 |
Stock-based compensation | 2,677 | 2,379 |
Income from discontinued operations, net of tax | (390) | |
Gain on disposition of long-lived assets | (2,823) | |
Loss on deconsolidation of subsidiary | 19,937 | |
Changes in operating assets and liabilities, excluding the effects of acquisitions: | ||
Accounts receivable, net | 4,033 | (7,174) |
Materials and supplies, prepayments, and other current assets | (4,275) | (3,336) |
Accounts payable and accrued liabilities, advance payments and deposits and other current liabilities | 4,440 | (641) |
Accrued taxes | 18,553 | (23,952) |
Other | (5,879) | (1,905) |
Net cash provided by (used in) operating activities of continuing operations | 80,542 | 15,307 |
Net cash provided by operating activities of discontinued operations | 603 | (3,255) |
Net cash provided by operating activities | 81,145 | 12,052 |
Cash flows from investing activities: | ||
Capital expenditures | (28,031) | (25,104) |
Acquisition of business, net of acquired cash of $6,571 | (11,968) | |
Change in restricted cash | 39,001 | 19,206 |
Proceeds from disposition of long-lived assets | 5,873 | 1,371 |
Net cash used in investing activities of continuing operations | 4,875 | (4,527) |
Net cash provided by (used in) investing activities | 4,875 | (4,527) |
Cash flows from financing activities: | ||
Dividends paid on common stock | (9,267) | (8,574) |
Distribution to minority stockholders | (9,160) | (6,081) |
Payment of debt issuance costs | (30) | |
Proceeds from stock option exercises | 1,686 | 610 |
Principal repayments of term loan | (2,997) | |
Purchase of common stock | (1,568) | (1,283) |
Investments made by minority shareholders in consolidated affiliates | 905 | |
Net cash used in financing activities of continuing operations | (20,431) | (15,328) |
Net cash used in financing activities | (20,431) | (15,328) |
Net change in cash and cash equivalents | 65,589 | (7,803) |
Cash and cash equivalents, beginning of period | 326,216 | 356,607 |
Cash and cash equivalents, end of period | $ 391,805 | $ 348,804 |
ORGANIZATION AND BUSINESS OPERA
ORGANIZATION AND BUSINESS OPERATIONS | 6 Months Ended |
Jun. 30, 2015 | |
ORGANIZATION AND BUSINESS OPERATIONS | |
ORGANIZATION AND BUSINESS OPERATIONS | 1. ORGANIZATION AND BUSINESS OPERATIONS The Company is a holding company that, through its operating subsidiaries , (i) provides wireless and wireline telecommunications services in North America, Bermuda and the Caribbean, (ii) owns and operates commercial distributed generation solar power systems in the United States, and (iii) owns and operates terrestrial and submarine fiber optic transport systems in the United States and the Caribbean, respectively. The Company offers the following principal services: · Wireless. In the United States, the Company offers wholesale wireless voice and data roaming services to national, regional, local and selected international wireless carriers in rural markets located principally in the Southwest and Midwest United States . The Company also offers wireless voice and data services to retail customers in Guyana, Bermuda, and in other smaller markets in the Caribbean and the United States. · Wireline. The Company’s local telephone and data services include its operations in Guyana and the mainland United States. The Company is the exclusive licensed provider of domestic wireline local and long-distance telephone services in Guyana and international voice and data communications into and out of Guyana. The Company also offers facilities-based integrated voice and data communications services and wholesale transport services to enterprise and residential customers in New England, primarily in Vermont, and in New York State. In addition, the Company offers wholesale long-distance voice services to telecommunications carriers. · Renewable Energy. In the United States, the Company provides distributed generation solar power to corporate, utility and municipal customers in Massachusetts, California and New Jersey. The following chart summarizes the operating activities of the Company’s principal subsidiaries, the segments in which the Company reports its revenue and the markets it served as of June 30, 2015 : Services Segment Markets Tradenames Wireless U.S. Wireless United States (rural markets) Commnet, Choice Island Wireless Aruba, Bermuda, Turks and Caicos (through March 23, 2015), U.S. Virgin Islands Mio, CellOne, Islandcom (through March 23, 2015), Choice International Integrated Telephony Guyana Cellink Wireline International Integrated Telephony Guyana GT&T U.S. Wireline United States (New England and New York State) Sovernet, ION, Essextel Renewable Energy Renewable Energy United States (Massachusetts California and New Jersey) Ahana Renewables The Company is actively evaluating potential acquisitions, investment opportunities and other strategic transactions, both domestic and international, that meet its return ‑on ‑investment and other criteria. The Company provides management, technical, financial, regulatory, and marketing services to its subsidiaries and typically receives a management fee equal to a percentage of their respective revenue and which the Company believes approximates the level of effort provided for such services. Management fees from subsidiaries are eliminated in consolidation. For information about the Company’s business segments and geographical information about its revenue, operating income and long ‑lived assets, see Note 11 to the Unaudited Condensed Consolidated Financial Statements. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2015 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | 2. BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial information included herein is unaudited; however, the Company believes such information and the disclosures herein are adequate to make the information presented not misleading and reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company’s financial position and results of operations for such periods. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted i n the United States of America . Results of interim periods may not be indicative of results for the full year. These condensed consolidated financial statements and related notes should be read in conjunction with the Company’s 2014 Annual Report on Form 10-K . The consolidated financial statements include the accounts of the Company, its majority-owned subsidiaries and certain entities, which are consolidated in accordance with the provisions of the Financial Accounting Standards Board’s (“FASB”) authoritative guidance on the consolidation of variable interest entities since it is determined that the Company is the primary beneficiary of these entities. Certain reclassifications have been made in the prior period financial statements to conform the Company’s consolidated income statements to how management analyzes its operations in the current period. The changes did not impact operating income. For the three months ended June 30, 2014 the aggregate impact of the changes included an increase to termination and access fees of $3.5 million, a decrease to engineering and operations expenses of $2.6 million, an increase to sales and marketing expenses of $0.4 million and a decrease to general and administrative expenses of $1.3 million. For the six months ended June 30, 2014 the aggregate impact of the changes included an increase to termination and access fees of $6.7 million, a decrease to engineering and operations expenses of $5.2 million, an increase to sales and marketing expenses of $0.7 million and a decrease to general and administrative expenses of $2.3 million. The Company’s effective tax rates for the three months ended June 30, 2014 and 2015 were 33.9% and 46.4% , respectively. The Company’s effective tax rates for the six months ended June 30, 2014 and 2015 were 34.3% and 47.0% , respectively. The Company’s effective tax rate increased in 2015 primarily due to a larger portion of our earnings consisting of losses generated in a non-tax foreign jurisdiction for which we receive no tax benefit. Recent Accounting Pronouncements In May 2014, the FASB issued a standard on revenue recognition providing a single, comprehensive revenue recognition model for all contracts with customers. The revenue standard is based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. On July 9, 2015, the FASB approved the deferral of the new standard's effective date by one year. The new standard now would be effective for annual reporting periods beginning after December 15, 2017. The FASB will permit companies to adopt the new standard early, but not before the original effective date of December 15, 2016 . The Company is currently evaluating the adoption method options and the impact of the new guidance on our consolidated financial statements. In April 2014, the FASB issued Accounting Standards Update (“ASU”) 2014 08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” ASU 2014 08 provides guidance on determining when disposals can be presented as discontinued operations. ASU 2014 08 requires that only disposals representing a strategic shift in operations should be presented as discontinued operations. A strategic shift may include a disposal of a major line of business, major equity method investment or a major part of an entity. Additionally, ASU 2014 08 requires expanded disclosures regarding discontinued operations. This standard was effective prospectively for reporting periods beginning after December 15, 2014. The adoption of this amendment did not have a material impact on the Company’s consolidated financial statements. In April 2015, FASB issued ASU 2015-03, which amends the presentation of debt issuance costs on the consolidated balance sheet. Under the new guidance, debt issuance costs are presented as a direct deduction from the carrying amount of the debt liability rather than as an asset. The new guidance is effective retrospectively for fiscal periods starting after December 15, 2015 and early adoption is permitted. We expect to adopt ASU 2015-03 on January 1, 2016 and have determined that its adoption will not have a material impact on our consolidated financial statements and related disclosures at that time. |
USE OF ESTIMATES
USE OF ESTIMATES | 6 Months Ended |
Jun. 30, 2015 | |
USE OF ESTIMATES | |
USE OF ESTIMATES | 3. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates relate to the allowance for doubtful accounts, useful lives of the Company’s fixed and finite-lived intangible assets, allocation of purchase price to assets acquired and liabilities assumed in purchase business combinations, fair value of indefinite-lived intangible assets, goodwill and income taxes . Actual results could differ significantly from those estimates. |
ACQUISITIONS
ACQUISITIONS | 6 Months Ended |
Jun. 30, 2015 | |
ACQUISITIONS | |
ACQUISITIONS | 4. ACQUISITIONS On December 24, 2014, the Company acquired substantially all of the assets of Green Lake Capital, LLC and certain of its affiliates (collectively, "Green Lake"), an owner and operator of commercial distributed generation solar power systems in Massachusetts, California and New Jersey (the "Ahana Acquisition"). The Company acquired these assets as part of a total transaction valued at approximately $117.7 million which is comprised of approximately $66.3 million of cash consideration , a $12.5 million reimbursement of cash and restricted cash held by Green Lake on the date of the acquisition, and the assumption of $38.9 million of debt. The acquisition was performed through the Company's newly formed subsidiary, Ahana Renewables, LLC ("Ahana Renewables"). Certain subsidiaries of Ahana Renewables have been partially capitalized by a third-party tax equity investor who maintains a non-controlling interest in these subsidiaries. The tax equity investor’s interest in these subsidiaries changes at a certain date (the "Flip Date"), which is the later of a) the five -year anniversary of the placed in service date for the solar assets owned by the subsidiary or, b) the date that the tax equity investor receives a certain return on their original investment in that subsidiary. These dates typically occur at approximately 2 - 4 years from the acquisition date. The profits and losses of these subsidiaries will be allocated to the tax equity investors and to the Company using the Hypothetical Liquidation Book Value method. The Hypothetical Liquidation Book Value Method is used to calculate the non-controlling interests' share of income for each period by measuring the difference in funds that would flow to the non-controlling interests in a hypothetical liquidation event at the beginning of the period compared to the end of a period (adjusted for capital distributions). The method assumes that the proceeds on liquidation approximate book value and then the proceeds are allocated to the Company and non-controlling interests based on the liquidation provisions of the solar facility operating agreement. A positive difference during the period represents non-controlling interests' share of income and a decrease represents a loss . Ahana Renewables has the option to buy-out the non-controlling interests. Ahana Renewables generates revenue from the sale of electricity through long-term ( 10 - 25 years) power purchase agreements as well as the sale of Solar Renewable Energy Credits (“SRECs”) which are government emissions allowances obtained through power generation and compliance with various regulations. |
LOSS ON DECONSOLIDATION OF SUBS
LOSS ON DECONSOLIDATION OF SUBSIDIARY | 6 Months Ended |
Jun. 30, 2015 | |
LOSS ON DECONSOLIDATION OF SUBSIDIARY | |
LOSS ON DECONSOLIDATION OF SUBSIDIARY | 5. LOSS ON DECONSOLIDATION OF SUBSIDIARY During March 2015, the Company’s sold certain assets and liabilities of its Island Wireless segment. As a result, the Company recorded a loss of approximately $19.9 million arising from the deconsolidation of non-controlling interests of $20.0 million and a gain of $0.1 million arising from an excess of sales proceeds over the carrying value of net assets disposed of. The disposition is included within other income (expense) and does not relate to a strategic shift in the Company’s operations . As a result, the subsidiary’s historical results and financial position are presented with continuing operations |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2015 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 6 . FAIR VALUE MEASUREMENTS In accordance with the provisions of fair value accounting, a fair value measurement assumes that a transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability and defines fair value based upon an exit price model. The fair value measurement guidance establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The guidance describes three levels of inputs that may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset and liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 assets and liabilities include money market funds, debt and equity securities and derivative contracts that are traded in an active exchange market. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. This category generally includes corporate obligations and non-exchange traded derivative contracts. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments and intangible assets that have been impaired whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Assets and liabilities of the Company measured at fair value on a recurring basis as of December 31, 2014 and June 30, 2015 are summarized as follows ( in thousands ) : December 31, 2014 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Total assets measured at fair value $ $ $ Debt (Note 7) $ — $ $ Total liabilities measured at fair value $ — $ $ June 30, 2015 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Total assets measured at fair value $ $ $ Certificate of Deposit As of December 31, 2014 and June 30, 2015 , this asset class consisted of a time deposit at a financial institution denominated in U.S. dollars. The asset class is classified within Level 2 of the fair value hierarchy because the fair value was based on observable market data. Money Market Funds As of December 31, 2014 and June 30, 2015 , this asset class consisted of a money market portfolio that comprises Federal government and U.S. Treasury securities. The asset class is classified within Level 1 of the fair value hierarchy because its underlying investments are valued using quoted market prices in active markets for identical assets. |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2015 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 7 . LONG-TERM DEBT Long-term debt comprises the following (in thousands): December 31, June 30, 2014 2015 Term loans assumed in Ahana acquisition $ $ Less: current portion Total long-term debt $ $ On December 19, 2014, the Company amended and restated its credit facility to provide for a $225 million revolving credit facility (the "Amended Credit Facility") that includes (i) up to $10 million under the Amended Credit Facility for standby or trade letters of credit, (ii) up to $25 million under the Amended Credit Facility for letters of credit that are necessary or desirable to qualify for disbursements from the FCC's mobility fund and (iii) up to $10 million under a swingline sub-facility. Amounts the Company may borrow under the Amended Credit Facility bear interest at a rate equal to, at its option, either (i) the London Interbank Offered Rate ( LIBOR ) plus an applicable margin ranging between 1.50% to 1.75% or (ii) a base rate plus an applicable margin ranging from 0.50% to 0.75% . Swingline loans will bear interest at the base rate plus the applicable margin for base rate loans. The base rate is equal to the higher of (i) 1.00% plus the higher of (x) the one-week LIBOR and (y) the one-month LIBOR ; (ii) the federal funds effective rate (as defined in the Credit Agreement) plus 0.50% per annum; and (iii) the prime rate (as defined in the Credit Agreement). The applicable margin is determined based on the ratio (as further defined in the Amended Credit Agreement) of the Company's indebtedness to EBITDA. Under the terms of the Amended Credit Agreement, the Company must also pay a fee ranging from 0.175% to 0.250% of the average daily unused portion of the Amended Credit Facility over each calendar quarter. The Amended Credit Facility contains customary representations, warranties and covenants, as well as covenants by the Company limiting additional indebtedness, liens, guaranties, mergers and consolidations, substantial asset sales, investments and loans, sale and leasebacks, transactions with affiliates and fundamental changes. In addition, the Amended Credit Facility contains a financial covenant by us that imposes a maximum ratio of indebtedness to EBITDA. As of June 30, 2015 , the Company was in compliance with all of the financial covenants of the Amended Credit Facility . Throughout 2014 and as of June 30, 2015 , the Company had no borrowings under the Amended Credit Facility and approximately $10.6 million o f outstanding letters of credit. The carrying value of debt approximates its fair value. Acquisition of Green Lake Capital, LLC In connection with the Ahana Acquisition on December 24, 2014, the Company assumed $38.9 million in long-term debt (the "Ahana Debt"). The Ahana Debt includes multiple loan agreements with banks that bear interest at rates between 4.5% and 6.0% , mature at various times between 2018 and 2023 and are secured by certain solar facilities. Repayment of the Ahana Debt with the banks is made on a monthly basis until maturity. The Ahana Debt also includes a loan from Public Service Electric & Gas (PSE&G) of $2.8 million. The note payable to PSE&G bears interest at 11.3% , matures in 2027, and is secured by certain solar facilities. Repayment of the Ahana Debt with PSE&G can be made in either cash or solar renewable energy credits (“SRECs”), at the Company's discretion, with the value of the SRECs being the current market value as of the date of repayment . |
GOVERNMENT GRANTS
GOVERNMENT GRANTS | 6 Months Ended |
Jun. 30, 2015 | |
GOVERNMENT GRANTS | |
GOVERNMENT GRANTS | 8. GOVERNMENT GRANTS The Company has received funding from the U.S. Government and its agencies under Stimulus and Universal Services Fund programs. These are generally designed to fund telecommunications infrastructure expansion into rural or underserved areas of the United States. The fund programs are evaluated to determine if they represent funding related to capital expenditures (capital grants) or operating activities (income grants). Mobility Fund Grants As part of the Federal Communications Commission’s (“FCC”) reform of its Universal Service Fund (“USF”) program, which previously provided support to carriers seeking to offer telecommunications services in high-cost areas and to low-income households, the FCC created two new funds, including the Mobility Fund, a one-time award meant to support wireless coverage in underserved geographic areas in the United States. In August 2013, the Company received FCC final approval for $21.7 million of Mobility Fund support to its wholesale wireless business (the "Mobility Funds" ) , to expand voice and broadband networks in certain geographic areas in order to offer either 3G or 4G coverage. As part of the receipt of the Mobility Funds, the Company committed to comply with certain additional FCC construction and other requirements. A portion of these funds will be used to offset network capital costs and a portion is used to offset the costs of supporting the networks for a period of five years. In connection with the Company’s application for the Mobility Funds, the Company has issued approximately $10.6 million in letters of credit to the Universal Service Administrative Company (“USAC”) has to secure these obligations. If the Company fails to comply with any of the terms and conditions upon which the Mobility Funds were granted, or if it loses eligibility for the Mobility Funds, USAC will be entitled to draw the entire amount of the letter of credit applicable to the affected project plus penalties and may disqualify the Company from the receipt of additional Mobility Fund support. The Company began the construction of its Mobility Funds projects during the third quarter of 2013 and its results are included in the Company’s “U.S. Wireless” segment. As of June 30, 2015 , the Company has received approximately $ 8.1 million in Mobility Funds. Of these funds, $ 2.0 million was recorded as an offset to the cost of the property, plant, and equipment associated with these projects and, consequentially, a reduction of future depreciation expense and $ 2.3 million is recorded within other current liabilities while the remaining $3.8 million is recorded within other long-term liabilities in the Company's consolidated balance sheet as of June 30, 2015 . The balance sheet presentation is based on the timing of the expected usage of the funds which will reduce future operations expenses. |
EQUITY
EQUITY | 6 Months Ended |
Jun. 30, 2015 | |
EQUITY | |
EQUITY | 9. EQUITY Shareholders’ equity was as follows (in thousands): Six months ended June 30, 2014 2015 Atlantic Tele- Non-Controlling Atlantic Tele- Non-Controlling Total Network, Inc. Interests Total Equity Network, Inc. Interests Equity Equity, beginning of period $ $ $ $ $ $ Stock-based compensation — — Comprehensive income: Net income Translation adjustment — — — — Total comprehensive income Issuance of common stock upon exercise of stock options — — Dividends declared on common stock — — Distributions to non-controlling interests — — Investments made by non-controlling interests — — — — Sale of non-controlling interests — — — — Purchase of treasury stock — — Equity, end of period $ $ $ $ $ $ |
NET INCOME PER SHARE
NET INCOME PER SHARE | 6 Months Ended |
Jun. 30, 2015 | |
NET INCOME PER SHARE | |
NET INCOME PER SHARE | 10. NET INCOME PER SHARE For the three and six months ended June 30, 2014 and 2015 , outstanding stock options were the only potentially dilutive securities. The reconciliation from basic to diluted weighted average common shares outstanding is as follows (in thousands): Three months ended June 30, Six months ended June 30, 2014 2015 2014 2015 Basic weighted-average common shares outstanding Stock options Diluted weighted-average common shares outstanding There were no anti-dilutive shares for any of the periods presented. |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2015 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | 11. SEGMENT REPORTING For the six months ended June 30, 2014, the Company had four reportable segments for separate disclosure in accordance with the FASB’s authoritative guidance on disclosures about segments of an enterprise. Those four segments were: i) U.S. Wireless, which generates all of its revenues in and has all of its assets located in the United States, ii) International Integrated Telephony, which generates all of its revenues in and has all of its assets located in Guyana, iii) Island Wireless, which generates a majority of its revenues in, and has a majority of its assets located in, Bermuda and which also generates revenues in and has assets located in the U.S. Virgin Islands, Aruba and Turks and Caicos (through March 23, 2015) and iv) U.S. Wireline, which generates all of its revenues in and has all of its assets located in the United States. With the Ahana Acquisition on December 24, 2014, the Company added a fifth reportable segment, Renewable Energy, which generates all of its revenues in and has all of its assets located in the United States. Segment presentations for the six months ended June 30, 2014 were not impacted by the Ahana Acquisition. The operating segments are managed separately because each offers different services and serves different markets. The following tables provide information for each operating segment (in thousands): For the Three Months Ended June 30, 2014 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — — — Equipment and Other — — Total Revenue — — Depreciation and amortization — Non-cash stock-based compensation — — — — — Operating income (loss) — For the Three Months Ended June 30, 2015 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — Equipment and Other — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — — — Operating income (loss) For the Six Months Ended June 30, 2014 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — — — Equipment and Other — — Total Revenue — — Depreciation and amortization — Non-cash stock-based compensation — — — — — Operating income (loss) — For the Six Months Ended June 30, 2015 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — Equipment and Other — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — — — Operating income (loss) International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated December 31, 2014 Net fixed assets $ $ $ $ $ $ $ Goodwill — — — Total assets (1) June 30, 2015 Net fixed assets $ $ $ $ $ $ $ Goodwill — — — Total assets (1) (1) Includes $175 and $70 of assets associated with our discontinued operations as of December 31, 2014 and June 30, 2015, respectively. Capital Expenditures International U.S. Integrated Island U.S. Renewable Reconciling Six months ended June 30, Wireless Telephony Wireless Wireline Energy Items Consolidated 2014 $ $ $ $ $ — $ $ 2015 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2015 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 12. COMMITMENTS AND CONTINGENCIES Regulatory and Litigation Matters The Company and its subsidiaries are subject to certain regulatory and legal proceedings and other claims arising in the ordinary course of business, some of which involve claims for damages and taxes that are substantial in amount. The Company believes that, except for the items discussed below, for which the Company is currently unable to predict the final outcome, the disposition of proceedings currently pending will not have a material adverse effect on the Company’s financial position or results of operations. As part of the FCC’s reform of its USF program, which previously provided support to carriers seeking to offer telecommunications services in high-cost areas and to low-income households, the FCC created two new funds, including the Mobility Fund, a one-time award meant to support wireless coverage in underserved geographic areas in the United States. In August 2013, the Company received FCC final approval for $21.7 million of Mobility Fund support to its wholesale wireless business (the "Mobility Funds" ), to expand voice and broadband networks in certain geographic areas in order to offer either 3G or 4G coverage. As part of the receipt of the Mobility Funds, the Company committed to comply with certain additional FCC construction and other requirements. A portion of these funds will be used to offset network capital costs and a portion is used to offset the costs of supporting the networks for a period of five years. In connection with the Company’s application for the Mobility Funds, the Company has issued approximately $10.6 million in letters of credit to the Universal Service Administrative Company (“USAC”) to secure these obligations. The letters of credit accrue a fee at a rate of 1.75% per annum on the outstanding amounts. As of June 30, 2015 the Company had approximately $10.6 million in letters of credit payable to USAC outstanding to cover its Mobility Fund obligations and there were no drawdowns against these letters of credit. If the Company fails to comply with any of the terms and conditions upon which the Mobility Funds were granted, or if it loses eligibility for the Mobility Funds, USAC will be entitled to draw the entire amount of the letter of credit applicable to the affected project plus penalties and may disqualify the Company from the receipt of additional Mobility Fund support. Currently, the Company’s Guyana subsidiary, GT&T, holds a license to provide domestic fixed services and international voice and data services in Guyana on an exclusive basis until December 2030. Since 2001, the Government of Guyana has stated its intention to introduce additional competition into Guyana’s telecommunications sector. Since that time, the Company and GT&T have met on several occasions with officials of the Government of Guyana to discuss potential modifications of GT&T’s exclusivity and other rights under the existing agreement and license. In 2012, the Government of Guyana introduced draft legislation in Parliament that, if enacted, would have the effect of terminating the Company’s exclusive license rights by permitting other telecommunications carriers to receive licenses to provide domestic fixed services and international voice and data services in Guyana. Along with the draft legislation, the Government also released drafts of new regulations and licenses (collectively, the “Draft Laws”). These Draft Laws would also introduce material changes to many other features of Guyana’s existing telecommunications regulatory regime. While little or no substantive actions were taken on the Draft Laws since 2012, the Company cannot predict when or if the proposed legislation will be adopted by Parliament or, if adopted and then signed into law by the President, the manner in which it would be implemented by the relevant Minister and the PUC. Although the Company believes that it would be entitled to damages or other compensation for any involuntary termination of its contractual exclusivity rights, it cannot guarantee that the Company would prevail in a proceeding to enforce its rights or that its actions would effectively halt any unilateral action by the Government. Historically, GT&T has been subject to other litigation proceedings and disputes in Guyana that, while not conclusively resolved, to the Company’s knowledge have not been the subject of discussions or other significant activity in the last five years. It is possible, but not likely, that these disputes, as discussed below, may be revived. The Company believes that none of these additional proceedings would, in the event of an adverse outcome, have a material impact on the Company’s consolidated financial position, results of operation or liquidity. In a letter dated September 8, 2006, the National Frequency Management Unit ("NFMU") agreed that total spectrum fees in Guyana should not increase for the years 2006 and 2007. However, that letter implied that spectrum fees in 2008 and onward may be increased beyond the amount GT&T agreed to with the Government. GT&T has objected to the NFMU's proposed action and reiterated its position that an increase in fees prior to development of an acceptable methodology would violate the Government's prior agreement. Using a recommended methodology for the calculation of spectrum fees as jointly proposed by GT&T and Digicel to the NFMU by letter in November 2011, GT&T, over the past four years, calculated and paid the NFMU spectrum fees representing payments in full for 2008-2014. While the NFMU rejected this proposed methodology in 2011, to date, it has not yet provided its own recommendation for such calculation to GT&T. There have been no further discussions on this subject and GT&T has not had the opportunity to review any recommendation made to the Minister. In November 2007, Caribbean Telecommunications Limited (“CTL”) filed a complaint in the U.S. District Court for the District of New Jersey against GT&T and ATN claiming breach of an interconnection agreement for domestic cellular services in Guyana and related claims. CTL asserted over $200 million in damages. GT&T and ATN moved to dismiss the complaint on procedural and jurisdictional grounds. On January 26, 2009, the court granted the motions to dismiss the complaint on the grounds asserted. On November 7, 2009 and again on April 4, 2013, CTL filed a similar claim against GT&T and the PUC in the High Court of Guyana. The Company believes these claims are without merit and are duplicative of a previous claim filed by CTL in Guyana that was dismissed. There has been no action on these matters since the April 2013 filing. On May 8, 2009, Digicel filed a lawsuit in Guyana challenging the legality of GT&T’s exclusive license rights under Guyana’s constitution. Digicel initially filed this lawsuit against the Attorney General of Guyana in the High Court. On May 13, 2009, GT&T petitioned to intervene in the suit in order to oppose Digicel’s claims and that petition was granted on May 18, 2009. GT&T filed an answer to the charge on June 22, 2009 and the case is pending. The Company believes that any legal challenge to GT&T’s exclusive license rights granted in 1990 is without merit and the Company intends to vigorously defend against such a legal challenge. On February 17, 2010, GT&T filed a lawsuit in the High Court of Guyana asserting that, despite its denials, Digicel is engaged in international bypass in violation of GT&T’s exclusive license rights, the interconnection agreement between the parties, and the laws of Guyana. GT&T is seeking, among other things, injunctive relief to stop the illegal bypass activity, actual damages in excess of US$9 million and punitive damages of approximately US$5 million. Digicel filed counterclaims alleging that GT&T has violated the terms of the interconnection agreement and Guyana laws. GT&T intends to vigorously prosecute this suit. On July 20, 2012 a trial court in Guyana made findings calling into question the validity of GT&T's exclusive license to provide international voice and data service in Guyana and the applicability of that license to telecommunications services using Voice over Internet Protocol ("VoIP"). The findings were made in a breach of contract case brought originally in 2007 against GT&T by a subscriber to its Internet service. The Court of Appeals in Guyana reversed the decision of the trial court and both Plaintiff and GT&T appealed the case to the Caribbean Court of Justice (“CCJ”). In July 2015, the CCJ upheld the trial judge’s finding that no GT&T contract term prohibited the personal use of VoIP by the GT&T customer. The CCJ declined to express any view on the validity or Constitutionality of GT&T’s exclusive license and dismissed that aspect of the appeal. GT&T is also involved in several legal claims regarding its tax filings with the Guyana Revenue Authority dating back to 1991 regarding the deductibility of intercompany advisory fees as well as other tax assessments. Should GT&T be held liable for any of the disputed tax assessments, totaling $33.2 million, the Company believes that the Government of Guyana would then be obligated to reimburse GT&T for any amounts necessary to ensure that GT&T’s return on investment was no less than 15% per annum for the relevant periods. In Bermuda, the Regulatory Authority continued its implementation of the Electronic Communications Act of 2011, which allows communications service providers to enter new lines of business and encourages further competition in the sector. As the government of Bermuda reforms the local telecommunications market, it has imposed regulatory and other fees and adopted additional regulation that have increased the regulatory costs incurred by and could otherwise impact the Company’s Bermuda operations. For instance, in December 2014, the Bermuda Regulatory Authority adopted a decision imposing a limitation on amounts of spectrum that may be held by a single carrier and requiring the Company to surrender a portion of existing spectrum held in Bermuda that the Company had reserved for the launch of next generation services in accordance with the Company’s plans and demands of its customers. The Company initiated legal proceedings challenging the implementation of such decision, however, was not successful in staying the decision and in March 2015 surrendered the spectrum in question to the Bermuda Regulatory Authority. The Company has withdrawn its appeal of the decision without prejudice and cannot now accurately predict the impact to the competitive position of the Company’s Bermuda business or limitations that such actions will have on the Company’s ability to grow. The term of the Company’s telecommunications license to operate in Aruba expired on January 15, 2014. The government of Aruba informed the Company earlier in January 2014 that a renewed license would be issued only upon payment by the Company of a fee in the amount of Afl 7.2 million (or approximately US$4 million). The Company is continuing to operate as it is actively contesting the assessment of such fee. |
ORGANIZATION AND BUSINESS OPE19
ORGANIZATION AND BUSINESS OPERATIONS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
ORGANIZATION AND BUSINESS OPERATIONS | |
Schedule of the operating activities of the Company's principal subsidiaries, the segments in which the Company reports its revenue and markets served | Services Segment Markets Tradenames Wireless U.S. Wireless United States (rural markets) Commnet, Choice Island Wireless Aruba, Bermuda, Turks and Caicos (through March 23, 2015), U.S. Virgin Islands Mio, CellOne, Islandcom (through March 23, 2015), Choice International Integrated Telephony Guyana Cellink Wireline International Integrated Telephony Guyana GT&T U.S. Wireline United States (New England and New York State) Sovernet, ION, Essextel Renewable Energy Renewable Energy United States (Massachusetts California and New Jersey) Ahana Renewables |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
FAIR VALUE MEASUREMENTS | |
Schedule of assets and liabilities of the entity measured at fair value on a recurring basis | Assets and liabilities of the Company measured at fair value on a recurring basis as of December 31, 2014 and June 30, 2015 are summarized as follows ( in thousands ) : December 31, 2014 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Total assets measured at fair value $ $ $ Debt (Note 7) $ — $ $ Total liabilities measured at fair value $ — $ $ June 30, 2015 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Total assets measured at fair value $ $ $ |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
LONG-TERM DEBT | |
Schedule of long-term debt | Long-term debt comprises the following (in thousands): December 31, June 30, 2014 2015 Term loans assumed in Ahana acquisition $ $ Less: current portion Total long-term debt $ $ |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
EQUITY | |
Schedule of stockholders' equity (in thousands) | Six months ended June 30, 2014 2015 Atlantic Tele- Non-Controlling Atlantic Tele- Non-Controlling Total Network, Inc. Interests Total Equity Network, Inc. Interests Equity Equity, beginning of period $ $ $ $ $ $ Stock-based compensation — — Comprehensive income: Net income Translation adjustment — — — — Total comprehensive income Issuance of common stock upon exercise of stock options — — Dividends declared on common stock — — Distributions to non-controlling interests — — Investments made by non-controlling interests — — — — Sale of non-controlling interests — — — — Purchase of treasury stock — — Equity, end of period $ $ $ $ $ $ |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
NET INCOME PER SHARE | |
Schedule of reconciliation from basic to diluted weighted average common shares outstanding (in thousands) | Three months ended June 30, Six months ended June 30, 2014 2015 2014 2015 Basic weighted-average common shares outstanding Stock options Diluted weighted-average common shares outstanding |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
SEGMENT REPORTING | |
Schedule of information for each operating segment (in thousands) | For the Three Months Ended June 30, 2014 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — — — Equipment and Other — — Total Revenue — — Depreciation and amortization — Non-cash stock-based compensation — — — — — Operating income (loss) — For the Three Months Ended June 30, 2015 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — Equipment and Other — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — — — Operating income (loss) For the Six Months Ended June 30, 2014 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — — — Equipment and Other — — Total Revenue — — Depreciation and amortization — Non-cash stock-based compensation — — — — — Operating income (loss) — For the Six Months Ended June 30, 2015 International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated Revenue U.S. Wireless $ $ — $ — $ — $ — $ — $ International Wireless — — — — Wireline — — — Renewable energy — — — — — Equipment and Other — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — — — Operating income (loss) International U.S. Integrated Island U.S. Renewable Reconciling Wireless Telephony Wireless Wireline Energy Items Consolidated December 31, 2014 Net fixed assets $ $ $ $ $ $ $ Goodwill — — — Total assets (1) June 30, 2015 Net fixed assets $ $ $ $ $ $ $ Goodwill — — — Total assets (1) (1) Includes $175 and $70 of assets associated with our discontinued operations as of December 31, 2014 and June 30, 2015, respectively. Capital Expenditures International U.S. Integrated Island U.S. Renewable Reconciling Six months ended June 30, Wireless Telephony Wireless Wireline Energy Items Consolidated 2014 $ $ $ $ $ — $ $ 2015 |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) - Jun. 30, 2014 - USD ($) $ in Millions | Total | Total |
Termination and Access Fees [Member] | ||
Prior period corrections | ||
Reclassification, decrease (increase) to expense | $ (3.5) | $ (6.7) |
Engineering and Operations Expenses [Member] | ||
Prior period corrections | ||
Reclassification, decrease (increase) to expense | 2.6 | 5.2 |
Selling and Marketing Expense [Member] | ||
Prior period corrections | ||
Reclassification, decrease (increase) to expense | (0.4) | (0.7) |
General and administrative expense | ||
Prior period corrections | ||
Reclassification, decrease (increase) to expense | $ 1.3 | $ 2.3 |
BASIS OF PRESENTATION - Tax (De
BASIS OF PRESENTATION - Tax (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
BASIS OF PRESENTATION | ||||
Effective tax rate (as a percent) | 46.40% | 33.90% | 47.00% | 34.30% |
ACQUISITIONS (Details)
ACQUISITIONS (Details) - Ahana Renewables - USD ($) $ in Millions | Dec. 24, 2014 | Jun. 30, 2015 |
Acquisitions | ||
Total transaction value | $ 117.7 | |
Cash consideration | 66.3 | |
Reimbursement of cash held | 12.5 | |
Assumed debt | $ 38.9 | |
Minimum | Solar assets | ||
Acquisitions | ||
Useful life | 10 years | |
Maximum | Solar assets | ||
Acquisitions | ||
Useful life | 25 years | |
Tax Equity Investor | ||
Acquisitions | ||
Period of placed in service date for solar assets | 5 years | |
Tax Equity Investor | Minimum | ||
Acquisitions | ||
Period to receive return on investment | 2 years | |
Tax Equity Investor | Maximum | ||
Acquisitions | ||
Period to receive return on investment | 4 years |
LOSS ON DECONSOLIDATION OF SU28
LOSS ON DECONSOLIDATION OF SUBSIDIARY (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended |
Mar. 31, 2015 | Jun. 30, 2015 | |
Loss on deconsolidation of subsidiary | $ 19,937 | |
Island Wireless | ||
Deconsolidation of non-controlling interests | $ 20,000 | |
Gain arising from excess of proceeds over the carrying value of net assets | 100 | |
Island Wireless | Nonoperating Income (Expense) [Member] | ||
Loss on deconsolidation of subsidiary | $ 19,900 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Total | ||
Fair value measurements | ||
Total assets measured at fair value | $ 2,437 | |
Certificate of deposit | Total | ||
Fair value measurements | ||
Certificates of deposit | 363 | |
Money market funds | Total | ||
Fair value measurements | ||
Money market funds | 2,074 | |
Level 1 | ||
Fair value measurements | ||
Total assets measured at fair value | 2,074 | |
Level 1 | Money market funds | ||
Fair value measurements | ||
Money market funds | 2,074 | |
Level 2 | ||
Fair value measurements | ||
Total assets measured at fair value | 363 | |
Level 2 | Certificate of deposit | ||
Fair value measurements | ||
Certificates of deposit | $ 363 | |
Recurring basis | Total | ||
Fair value measurements | ||
Total assets measured at fair value | $ 1,856 | |
Debt (Note 7) | 38,877 | |
Total liabilities measured at fair value | 38,877 | |
Recurring basis | Certificate of deposit | Total | ||
Fair value measurements | ||
Certificates of deposit | 363 | |
Recurring basis | Money market funds | Total | ||
Fair value measurements | ||
Money market funds | 1,493 | |
Recurring basis | Level 1 | ||
Fair value measurements | ||
Total assets measured at fair value | 1,493 | |
Recurring basis | Level 1 | Money market funds | ||
Fair value measurements | ||
Money market funds | 1,493 | |
Recurring basis | Level 2 | ||
Fair value measurements | ||
Total assets measured at fair value | 363 | |
Debt (Note 7) | 38,877 | |
Total liabilities measured at fair value | 38,877 | |
Recurring basis | Level 2 | Certificate of deposit | ||
Fair value measurements | ||
Certificates of deposit | $ 363 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | Dec. 19, 2014 | |
Long-term debt | |||
Less: current portion | $ (6,231,000) | $ (6,083,000) | |
Total long-term debt | $ 29,649,000 | 32,794,000 | |
Wholesale Mobility Funds | |||
Long-term debt | |||
Commitment fee (as a percent) | 1.75% | ||
Amended Credit Facility [Member] | |||
Long-term debt | |||
Borrowings | $ 0 | 0 | |
Term loans | |||
Long-term debt | |||
Outstanding debt | 35,880,000 | 38,877,000 | |
Term loans | Ahana Debt | |||
Long-term debt | |||
Term loan assumed | $ 38,900,000 | ||
Term loans | Ahana Debt | Minimum | |||
Long-term debt | |||
Effective interest rate (as a percent) | 4.50% | ||
Term loans | Ahana Debt | Maximum | |||
Long-term debt | |||
Effective interest rate (as a percent) | 6.00% | ||
Term loans | Public Service Electric & Gas Note [Member] | |||
Long-term debt | |||
Face amount of term loans | $ 2,800,000 | ||
Stated interest rate | 11.30% | ||
Revolving credit facility | Amended Credit Facility [Member] | |||
Long-term debt | |||
Maximum borrowing capacity | $ 225,000,000 | ||
Revolving credit facility | Amended Credit Facility [Member] | Minimum | |||
Long-term debt | |||
Commitment fee (as a percent) | 0.175% | ||
Revolving credit facility | Amended Credit Facility [Member] | Minimum | LIBOR | |||
Long-term debt | |||
Basis spread on variable rate (as a percent) | 1.50% | ||
Revolving credit facility | Amended Credit Facility [Member] | Minimum | Base rate | |||
Long-term debt | |||
Basis spread on variable rate (as a percent) | 0.50% | ||
Revolving credit facility | Amended Credit Facility [Member] | Maximum | |||
Long-term debt | |||
Commitment fee (as a percent) | 0.25% | ||
Revolving credit facility | Amended Credit Facility [Member] | Maximum | LIBOR | |||
Long-term debt | |||
Basis spread on variable rate (as a percent) | 1.75% | ||
Revolving credit facility | Amended Credit Facility [Member] | Maximum | Base rate | |||
Long-term debt | |||
Basis spread on variable rate (as a percent) | 0.75% | ||
Swingline sub-facility | Amended Credit Facility [Member] | |||
Long-term debt | |||
Maximum borrowing capacity | 10,000,000 | ||
Swingline sub-facility | Amended Credit Facility [Member] | Federal Funds Effective Rate | |||
Long-term debt | |||
Basis spread on variable rate (as a percent) | 0.50% | ||
Swingline sub-facility | Amended Credit Facility [Member] | Minimum | Base rate | |||
Long-term debt | |||
Basis spread on variable rate (as a percent) | 1.00% | ||
Letter of credit sub-facility | |||
Long-term debt | |||
Outstanding letters of credit | $ 10,600,000 | $ 10,600,000 | |
Letter of credit sub-facility | Wholesale Mobility Funds | |||
Long-term debt | |||
Outstanding letters of credit | $ 10,600,000 | ||
Letter of credit sub-facility | Amended Credit Facility [Member] | |||
Long-term debt | |||
Maximum borrowing capacity | 10,000,000 | ||
Letter of credit sub-facility | Amended Credit Facility [Member] | Wholesale Mobility Funds | |||
Long-term debt | |||
Maximum borrowing capacity | $ 25,000,000 |
GOVERNMENT GRANTS (Details)
GOVERNMENT GRANTS (Details) $ in Millions | 1 Months Ended | 6 Months Ended | |
Aug. 31, 2013USD ($) | Jun. 30, 2015USD ($)item | Dec. 31, 2014USD ($) | |
MOBILITY FUND GRANTS | |||
Number of new funds created by FCC | item | 2 | ||
Period over which a portion of the Mobility Funds is used to offset the costs of supporting the networks | 5 years | ||
Letter of credit sub-facility | |||
MOBILITY FUND GRANTS | |||
Letters of credit posted to USAC | $ 10.6 | $ 10.6 | |
Wholesale Mobility Funds | |||
MOBILITY FUND GRANTS | |||
Mobility Funds approved by FCC | $ 21.7 | ||
Wholesale Mobility Funds | U.S. Wireless | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | 8.1 | ||
Wholesale Mobility Funds | U.S. Wireless | Property, Plant and Equipment [Member] | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | 2 | ||
Wholesale Mobility Funds | U.S. Wireless | Other current liabilities | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | 2.3 | ||
Wholesale Mobility Funds | U.S. Wireless | Other long-term liabilities | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | 3.8 | ||
Wholesale Mobility Funds | Letter of credit sub-facility | |||
MOBILITY FUND GRANTS | |||
Letters of credit posted to USAC | $ 10.6 |
EQUITY (Details)
EQUITY (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Stockholders' equity | ||||
Equity, beginning of period | $ 738,182 | $ 699,855 | ||
Stock-based compensation | 2,677 | 2,379 | ||
Comprehensive income: | ||||
Net income | $ 15,018 | $ 14,322 | 14,526 | 24,722 |
Other comprehensive income | ||||
Foreign currency translation adjustment | 28 | |||
Total comprehensive income | 14,554 | 24,722 | ||
Issuance of common stock upon exercise of stock options | 2,074 | 1,109 | ||
Dividends declared on common stock | (9,306) | (8,605) | ||
Distributions to non-controlling interests | (9,261) | (6,081) | ||
Investments made by non-controlling interest | 906 | |||
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | 20,013 | |||
Sale of non-controlling interest | 20,013 | |||
Purchase of treasury stock | (1,955) | (1,778) | ||
Equity, end of period | 757,884 | 711,601 | 757,884 | 711,601 |
Atlantic Tele-Network, Inc. | ||||
Stockholders' equity | ||||
Equity, beginning of period | 677,222 | 643,330 | ||
Stock-based compensation | 2,677 | 2,379 | ||
Comprehensive income: | ||||
Net income | 6,181 | 19,354 | ||
Other comprehensive income | ||||
Foreign currency translation adjustment | 28 | |||
Total comprehensive income | 6,209 | 19,354 | ||
Issuance of common stock upon exercise of stock options | 2,074 | 1,109 | ||
Dividends declared on common stock | (9,306) | (8,605) | ||
Purchase of treasury stock | (1,955) | (1,778) | ||
Equity, end of period | 676,921 | 655,789 | 676,921 | 655,789 |
Non-Controlling Interests | ||||
Stockholders' equity | ||||
Equity, beginning of period | 60,960 | 56,525 | ||
Comprehensive income: | ||||
Net income | 8,345 | 5,368 | ||
Other comprehensive income | ||||
Total comprehensive income | 8,345 | 5,368 | ||
Distributions to non-controlling interests | (9,261) | (6,081) | ||
Investments made by non-controlling interest | 906 | |||
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | 20,013 | |||
Sale of non-controlling interest | 20,013 | |||
Equity, end of period | $ 80,963 | $ 55,812 | $ 80,963 | $ 55,812 |
NET INCOME PER SHARE (Details)
NET INCOME PER SHARE (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reconciliation from basic to diluted weighted average common shares outstanding | ||||
Basic weighted-average common shares outstanding | 16,038,000 | 15,915,000 | 15,988,000 | 15,873,000 |
Stock options (in shares) | 112,000 | 108,000 | 121,000 | 113,000 |
Diluted weighted-average common shares outstanding | 16,150,000 | 16,023,000 | 16,109,000 | 15,986,000 |
Stock options | ||||
Reconciliation from basic to diluted weighted average common shares outstanding | ||||
Anti-dilutive potential shares excluded from the computation of diluted weighted average shares outstanding (in shares) | 0 | 0 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($)segment | Jun. 30, 2015USD ($)segment | Jun. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
Segment reporting | |||||
Number of reportable segments | segment | 4 | 5 | |||
Revenue | |||||
Revenue | $ 90,326 | $ 83,269 | $ 175,670 | $ 158,443 | |
Depreciation and amortization | 14,472 | 12,930 | 29,223 | 24,910 | |
Non-cash stock-based compensation | 1,453 | 1,323 | 2,677 | 2,379 | |
Operating income (loss) | 28,732 | 21,607 | 47,892 | 37,855 | |
Segment Assets | |||||
Net fixed assets | 362,432 | 362,432 | $ 369,582 | ||
Goodwill | 45,077 | 45,077 | 45,077 | ||
Total assets | 937,155 | 937,155 | 925,030 | ||
Capital Expenditures | |||||
Capital expenditures | 28,031 | 25,104 | |||
U.S. Wireless | |||||
Revenue | |||||
Revenue | 40,103 | 37,456 | 75,946 | 65,848 | |
International wireless | |||||
Revenue | |||||
Revenue | 20,223 | 22,422 | 41,395 | 45,570 | |
Wireline | |||||
Revenue | |||||
Revenue | 22,089 | 21,283 | 42,681 | 42,813 | |
Equipment and other | |||||
Revenue | |||||
Revenue | 2,621 | 2,108 | 5,069 | 4,212 | |
Renewable energy | |||||
Revenue | |||||
Revenue | 5,290 | 10,579 | |||
Reconciling Items | |||||
Revenue | |||||
Depreciation and amortization | 1,212 | 1,284 | 2,346 | 1,899 | |
Non-cash stock-based compensation | 1,424 | 1,323 | 2,467 | 2,379 | |
Operating income (loss) | (7,413) | (7,224) | (13,867) | (12,552) | |
Segment Assets | |||||
Net fixed assets | 13,988 | 13,988 | 14,655 | ||
Total assets | 303,396 | 303,396 | 287,871 | ||
Capital Expenditures | |||||
Capital expenditures | 1,679 | 1,253 | |||
Reconciling Items | Discontinued operations | |||||
Segment Assets | |||||
Total assets | 70 | 70 | 175 | ||
U.S. Wireless | |||||
Revenue | |||||
Revenue | 40,897 | 37,815 | 77,377 | 66,538 | |
Depreciation and amortization | 4,507 | 3,453 | 8,653 | 6,756 | |
Operating income (loss) | 24,043 | 22,651 | 41,952 | 36,240 | |
Segment Assets | |||||
Net fixed assets | 83,456 | 83,456 | 79,910 | ||
Goodwill | 32,148 | 32,148 | 32,148 | ||
Total assets | 194,477 | 194,477 | 188,377 | ||
Capital Expenditures | |||||
Capital expenditures | 14,125 | 14,845 | |||
U.S. Wireless | U.S. Wireless | |||||
Revenue | |||||
Revenue | 40,103 | 37,456 | 75,946 | 65,848 | |
U.S. Wireless | Wireline | |||||
Revenue | |||||
Revenue | 152 | 152 | 305 | 305 | |
U.S. Wireless | Equipment and other | |||||
Revenue | |||||
Revenue | 642 | 207 | 1,126 | 385 | |
International Integrated Telephony | |||||
Revenue | |||||
Revenue | 22,357 | 21,397 | 43,463 | 43,195 | |
Depreciation and amortization | 4,413 | 4,400 | 8,780 | 8,713 | |
Operating income (loss) | 6,466 | 4,594 | 10,232 | 10,229 | |
Segment Assets | |||||
Net fixed assets | 104,828 | 104,828 | 108,972 | ||
Total assets | 200,602 | 200,602 | 201,649 | ||
Capital Expenditures | |||||
Capital expenditures | 4,748 | 6,072 | |||
International Integrated Telephony | International wireless | |||||
Revenue | |||||
Revenue | 6,485 | 6,758 | 12,611 | 13,655 | |
International Integrated Telephony | Wireline | |||||
Revenue | |||||
Revenue | 15,410 | 14,445 | 30,009 | 29,151 | |
International Integrated Telephony | Equipment and other | |||||
Revenue | |||||
Revenue | 462 | 194 | 843 | 389 | |
Island Wireless | |||||
Revenue | |||||
Revenue | 15,199 | 17,305 | 31,771 | 35,228 | |
Depreciation and amortization | 1,986 | 2,607 | 4,530 | 5,215 | |
Operating income (loss) | 3,866 | 2,552 | 6,288 | 5,978 | |
Segment Assets | |||||
Net fixed assets | 23,050 | 23,050 | 26,590 | ||
Goodwill | 5,438 | 5,438 | 5,438 | ||
Total assets | 73,703 | 73,703 | 74,563 | ||
Capital Expenditures | |||||
Capital expenditures | 4,517 | 1,958 | |||
Island Wireless | International wireless | |||||
Revenue | |||||
Revenue | 13,738 | 15,664 | 28,784 | 31,915 | |
Island Wireless | Equipment and other | |||||
Revenue | |||||
Revenue | 1,461 | 1,641 | 2,987 | 3,313 | |
U.S. Wireline | |||||
Revenue | |||||
Revenue | 6,583 | 6,752 | 12,480 | 13,482 | |
Depreciation and amortization | 1,150 | 1,186 | 2,506 | 2,327 | |
Operating income (loss) | (921) | (966) | (2,056) | (2,040) | |
Segment Assets | |||||
Net fixed assets | 28,165 | 28,165 | 28,113 | ||
Goodwill | 7,491 | 7,491 | 7,491 | ||
Total assets | 42,895 | 42,895 | 42,446 | ||
Capital Expenditures | |||||
Capital expenditures | 2,950 | 976 | |||
U.S. Wireline | Wireline | |||||
Revenue | |||||
Revenue | 6,527 | 6,686 | 12,367 | 13,357 | |
U.S. Wireline | Equipment and other | |||||
Revenue | |||||
Revenue | 56 | $ 66 | 113 | $ 125 | |
Renewable energy | |||||
Revenue | |||||
Revenue | 5,290 | 10,579 | |||
Depreciation and amortization | 1,204 | 2,408 | |||
Non-cash stock-based compensation | 29 | 210 | |||
Operating income (loss) | 2,691 | 5,343 | |||
Segment Assets | |||||
Net fixed assets | 108,945 | 108,945 | 111,342 | ||
Total assets | 122,080 | 122,080 | $ 130,124 | ||
Capital Expenditures | |||||
Capital expenditures | 12 | ||||
Renewable energy | Renewable energy | |||||
Revenue | |||||
Revenue | $ 5,290 | $ 10,579 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - Debt Instrument, Name [Domain] AWG in Millions, $ in Millions | Feb. 17, 2010USD ($) | Jan. 31, 2014AWG | Jan. 31, 2014USD ($) | Aug. 31, 2013USD ($) | Nov. 30, 2007USD ($) | Jun. 30, 2015USD ($)item | Dec. 31, 2014USD ($) |
Commitments and contingencies | |||||||
Number of new funds created by FCC | item | 2 | ||||||
Period over which a portion of the Mobility Funds is used to offset the costs of supporting the networks | 5 years | ||||||
Renewal fee of telecommunications license | AWG 7.2 | $ 4 | |||||
Letter of credit sub-facility | |||||||
Commitments and contingencies | |||||||
Outstanding letters of credit | $ 10.6 | $ 10.6 | |||||
Wholesale Mobility Funds | |||||||
Commitments and contingencies | |||||||
Mobility Funds approved by FCC | $ 21.7 | ||||||
Commitment fee (as a percent) | 1.75% | ||||||
Wholesale Mobility Funds | Letter of credit sub-facility | |||||||
Commitments and contingencies | |||||||
Outstanding letters of credit | $ 10.6 | ||||||
Universal Service Administrative Company | Letter of credit sub-facility | |||||||
Commitments and contingencies | |||||||
Draw downs against issued letters of credit | $ 0 | ||||||
Lawsuit filed by CTL | Minimum | |||||||
Commitments and contingencies | |||||||
Damages asserted | $ 200 | ||||||
Litigation proceedings and disputes in Guyana | |||||||
Commitments and contingencies | |||||||
Period for which litigation proceedings and other disputes have not been the subject of discussions or other significant activity | 5 years | ||||||
Loss Contingency Period Over Which Spectrum Fees Are Disputed | 4 years | ||||||
Damages asserted | $ 9 | ||||||
Punitive damages | $ 5 | ||||||
Legal claims regarding tax filings with the Guyana Revenue Authority | |||||||
Commitments and contingencies | |||||||
Future payments related to disputed tax assessments | $ 33.2 | ||||||
Legal claims regarding tax filings with the Guyana Revenue Authority | Minimum | |||||||
Commitments and contingencies | |||||||
Percentage of return on investment ensured by the government of Guyana | 15.00% |