Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 01, 2017 | Jun. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | ATN International, Inc. | ||
Entity Central Index Key | 879,585 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 841 | ||
Entity Common Stock, Shares Outstanding | 16,144,061 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets: | ||
Cash and cash equivalents | $ 269,721 | $ 392,045 |
Restricted cash | 524 | 824 |
Short-term investments | 9,237 | |
Accounts receivable, net of allowances of $13.1 million and $9.3 million, respectively | 45,419 | 39,020 |
Materials and supplies | 14,365 | 8,220 |
Prepayments and other current assets | 28,103 | 28,383 |
Total current assets | 367,369 | 468,492 |
Fixed Assets: | ||
Property, plant and equipment | 1,138,362 | 807,247 |
Less accumulated depreciation | (490,650) | (433,744) |
Net fixed assets | 647,712 | 373,503 |
Telecommunication licenses, net | 48,291 | 43,468 |
Goodwill | 62,873 | 45,077 |
Customer relationships, net | 15,029 | 1,081 |
Restricted cash | 18,113 | 5,477 |
Other assets | 38,831 | 7,906 |
Total assets | 1,198,218 | 945,004 |
Current Liabilities: | ||
Current portion of long-term debt | 12,440 | 6,284 |
Accounts payable and accrued liabilities | 92,708 | 54,289 |
Dividends payable | 5,487 | 5,142 |
Accrued taxes | 13,531 | 9,181 |
Advance payments and deposits | 25,529 | 9,459 |
Other current liabilities | 410 | |
Total current liabilities | 150,105 | 84,355 |
Deferred income taxes | 46,622 | 45,406 |
Other liabilities | 47,939 | 26,944 |
Long-term debt, excluding current portion | 144,383 | 26,575 |
Total liabilities | 389,049 | 183,280 |
Commitments and contingencies (Note 13) | ||
ATN International, Inc. Stockholders’ Equity: | ||
Preferred stock, $0.01 par value per share; 10,000,000 shares authorized, none issued and outstanding | ||
Common stock, $0.01 par value per share; 50,000,000 shares authorized; 16,971,634 and 16,828,576 shares issued, respectively, and 16,138,983 and 16,067,736 shares outstanding respectively | 169 | 168 |
Treasury stock, at cost; 832,652 and 760,840 shares, respectively | (23,127) | (18,254) |
Additional paid-in capital | 160,176 | 154,768 |
Retained earnings | 538,109 | 547,321 |
Accumulated other comprehensive income/(loss) | 1,728 | (3,704) |
Total ATN International, Inc. stockholders’ equity | 677,055 | 680,299 |
Non-controlling interests | 132,114 | 81,425 |
Total equity | 809,169 | 761,724 |
Total liabilities and equity | $ 1,198,218 | $ 945,004 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowances (in dollars) | $ 13,149 | $ 9,294 |
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 | 16,971,634 | 16,828,576 |
Common stock, shares outstanding | 16,138,983 | 16,067,736 |
Treasury stock, shares | 832,652 | 760,840 |
CONSOLIDATED INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENTS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
REVENUE: | |||
Total revenue | $ 457,003 | $ 355,369 | $ 336,347 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | |||
Termination and access fees | 116,427 | 77,806 | 77,888 |
Engineering and operations | 52,902 | 39,582 | 30,954 |
Sales and marketing | 31,050 | 23,898 | 21,664 |
Equipment expense | 14,342 | 14,803 | 13,338 |
General and administrative | 94,293 | 59,436 | 52,734 |
Transaction-related charges | 16,279 | 7,182 | 2,959 |
Restructuring charges | 1,785 | ||
Depreciation and amortization | 75,980 | 56,890 | 51,234 |
Impairment of goodwill and long-lived assets | 11,425 | ||
Bargain purchase gain | (7,304) | ||
Gain on disposition of long-lived assets | 27 | (2,823) | |
Total operating expenses | 407,206 | 276,774 | 250,771 |
Income from operations | 49,797 | 78,595 | 85,576 |
OTHER INCOME (EXPENSE) | |||
Interest income | 1,239 | 588 | 788 |
Interest expense | (5,362) | (3,180) | (1,208) |
Loss on deconsolidation of subsidiary | (19,937) | ||
Other income, net | (300) | 135 | 1,012 |
Other expense, net | (4,423) | (22,394) | 592 |
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 45,374 | 56,201 | 86,168 |
Income taxes | 21,160 | 24,137 | 28,148 |
INCOME FROM CONTINUING OPERATIONS | 24,214 | 32,064 | 58,020 |
INCOME FROM DISCONTINUED OPERATIONS: | |||
Income from discontinued operations, net of tax | 1,092 | 1,102 | |
NET INCOME | 24,214 | 33,156 | 59,122 |
Net income attributable to non-controlling interests, net of tax expense of $1.3 million, $1.6 million, and $1.6 million, respectively. | (12,113) | (16,216) | (10,970) |
NET INCOME ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS | $ 12,101 | $ 16,940 | $ 48,152 |
NET INCOME PER WEIGHTED AVERAGE BASIC SHARE ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS: | |||
Continuing operations (in dollars per share) | $ 0.75 | $ 0.99 | $ 2.96 |
Discontinued operations (in dollars per share) | 0.07 | 0.07 | |
Total (in dollars per share) | 0.75 | 1.06 | 3.03 |
NET INCOME PER WEIGHTED AVERAGE DILUTED SHARE ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS: | |||
Continuing operations (in dollars per share) | 0.75 | 0.98 | 2.94 |
Discontinued operations (in dollars per share) | 0.07 | 0.07 | |
Total (in dollars per share) | $ 0.75 | $ 1.05 | $ 3.01 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||
Basic (in shares) | 16,131 | 16,022 | 15,898 |
Diluted (in shares) | 16,227 | 16,142 | 16,013 |
DIVIDENDS PER SHARE APPLICABLE TO COMMON STOCK (in dollars per share) | $ 1.32 | $ 1.22 | $ 1.12 |
Wireless | |||
REVENUE: | |||
Total revenue | $ 228,798 | $ 237,042 | $ 241,690 |
Wireline | |||
REVENUE: | |||
Total revenue | 188,019 | 86,485 | 85,284 |
Renewable energy | |||
REVENUE: | |||
Total revenue | 21,608 | 21,040 | |
Equipment and other | |||
REVENUE: | |||
Total revenue | $ 18,578 | $ 10,802 | $ 9,373 |
CONSOLIDATED INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENTS (Parentheticals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED INCOME STATEMENTS | |||
Discontinued operations, tax expense (benefit) | $ 1.3 | $ 1.6 | $ 1.6 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $ 24,214 | $ 33,156 | $ 59,122 |
Other comprehensive income: | |||
Foreign currency translation adjustment | (687) | 26 | 4 |
Unrealized gain on available-for-sale marketable securities | 868 | ||
Projected pension benefit obligation, net of tax expense of $0.7 million, $0.7 million and $0.6 million | 5,251 | (809) | (724) |
Other comprehensive income, net of tax | 5,432 | (783) | (720) |
Comprehensive income | 29,646 | 32,373 | 58,402 |
Less: Comprehensive income attributable to non-controlling interests | (12,113) | (16,216) | (10,970) |
Comprehensive income attributable to ATN International, Inc. | $ 17,533 | $ 16,157 | $ 47,432 |
CONSOLIDATED STATEMENTS OF COM7
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Projected pension benefit obligation, tax expense (benefit) | $ 0.7 | $ 0.7 | $ 0.6 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total ATNI Stockholders' Equity | Common Stock | Treasury Stock, Common, at cost | Additional Paid In Capital | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Non-Controlling Interests | Total |
Equity, beginning of period at Dec. 31, 2013 | $ 643,330 | $ 164 | $ (13,389) | $ 139,106 | $ 519,651 | $ (2,202) | $ 56,525 | $ 699,855 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Issuance of 43,034, 87,378 and 43,053 shares of common stock upon exercise of stock options for the years ended December 31, 2014, 2015 and 2016, respectively | 1,623 | 2 | 1,621 | 1,623 | ||||
Purchase of treasury stock of 34,293, 37,567, and 70,686 shares for the years ended December 2014, 2015, and 2016, respectively | (2,160) | (2,160) | (2,160) | |||||
Stock-based compensation | 4,324 | 4,324 | 4,324 | |||||
Dividends declared on common stock | (17,840) | (17,840) | (16,331) | (34,171) | ||||
Excess tax benefits from share-based compensation | 513 | 512 | 513 | |||||
Investments made by minority shareholders | 9,796 | 9,796 | ||||||
Comprehensive income: | ||||||||
Net income | 48,152 | 48,152 | 10,970 | 59,122 | ||||
Other comprehensive income (loss), net of tax expense (benefit) of $641, $717 and $677 for the years ended 2014, 2015 and 2016, respectively | (720) | (719) | (720) | |||||
Comprehensive income | 47,432 | 10,970 | 58,402 | |||||
Equity, end of period at Dec. 31, 2014 | 677,222 | 166 | (15,549) | 145,563 | 549,963 | (2,921) | 60,960 | 738,182 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Issuance of 109,318, 93,864 and 100,005 restricted shares of common stock for the years ended December 31, 2014, 2015 and 2016, respectively | 1 | 1 | 1 | |||||
Issuance of 43,034, 87,378 and 43,053 shares of common stock upon exercise of stock options for the years ended December 31, 2014, 2015 and 2016, respectively | 2,809 | 1 | 2,808 | 2,809 | ||||
Purchase of treasury stock of 34,293, 37,567, and 70,686 shares for the years ended December 2014, 2015, and 2016, respectively | (2,705) | (2,705) | (2,705) | |||||
Stock-based compensation | 4,974 | 4,974 | 4,974 | |||||
Dividends declared on common stock | (19,582) | (19,582) | (16,715) | (36,297) | ||||
Excess tax benefits from share-based compensation | 1,423 | 1,423 | 1,423 | |||||
Investments made by minority shareholders | 951 | 951 | ||||||
Deconsolidation of subsidiary | 20,013 | 20,013 | ||||||
Comprehensive income: | ||||||||
Net income | 16,940 | 16,940 | 16,216 | 33,156 | ||||
Other comprehensive income (loss), net of tax expense (benefit) of $641, $717 and $677 for the years ended 2014, 2015 and 2016, respectively | (783) | (783) | (783) | |||||
Comprehensive income | 16,157 | 16,216 | 32,373 | |||||
Equity, end of period at Dec. 31, 2015 | 680,299 | 168 | (18,254) | 154,768 | 547,321 | (3,704) | 81,425 | 761,724 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Issuance of 109,318, 93,864 and 100,005 restricted shares of common stock for the years ended December 31, 2014, 2015 and 2016, respectively | (1) | (1) | (1) | |||||
Issuance of 43,034, 87,378 and 43,053 shares of common stock upon exercise of stock options for the years ended December 31, 2014, 2015 and 2016, respectively | 1,409 | 1 | 1,408 | 1,409 | ||||
Purchase of treasury stock of 34,293, 37,567, and 70,686 shares for the years ended December 2014, 2015, and 2016, respectively | (4,873) | (4,873) | (4,873) | |||||
Stock-based compensation | 6,440 | 6,440 | 6,440 | |||||
Dividends declared on common stock | (21,313) | (21,313) | (8,848) | (30,161) | ||||
Excess tax benefits from share-based compensation | 592 | 592 | 592 | |||||
Non-controlling interest in equity acquired | (4,106) | (4,106) | 29,998 | 25,892 | ||||
Investments made by minority shareholders | 22,409 | 22,409 | ||||||
Deconsolidation of subsidiary | (310) | (310) | ||||||
Repurchase of non-controlling interests | 1,075 | 1,075 | (4,673) | (3,598) | ||||
Comprehensive income: | ||||||||
Net income | 12,101 | 12,101 | 12,113 | 24,214 | ||||
Other comprehensive income (loss), net of tax expense (benefit) of $641, $717 and $677 for the years ended 2014, 2015 and 2016, respectively | 5,432 | 5,432 | 5,432 | |||||
Comprehensive income | 17,533 | 12,113 | 29,646 | |||||
Equity, end of period at Dec. 31, 2016 | $ 677,055 | $ 169 | $ (23,127) | $ 160,176 | $ 538,109 | $ 1,728 | $ 132,114 | $ 809,169 |
CONSOLIDATED STATEMENTS OF EQU9
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF EQUITY | |||
Issuance of restricted shares of common stock | 100,005 | 93,864 | 109,318 |
Issuance of shares of common stock upon exercise of stock options | 43,053 | 87,378 | 43,034 |
Purchase of shares of common stock | 70,686 | 37,567 | 34,293 |
Other comprehensive income, tax | $ 677 | $ 717 | $ 641 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Cash flows from operating activities: | |||
Net income | $ 24,214 | $ 33,156 | $ 59,122 |
Adjustments to reconcile net income to net cash flows provided by operating activities: | |||
Depreciation and amortization | 75,980 | 56,890 | 51,234 |
Provision for doubtful accounts | 2,454 | 1,199 | 1,676 |
Amortization and write off of debt discount and debt issuance costs | 505 | 458 | 114 |
Stock-based compensation | 6,410 | 4,975 | 4,323 |
Deferred income taxes | (5,636) | 17,869 | (113) |
Bargain purchase gain | (7,304) | ||
(Gain) Loss on disposition of long-lived assets | 27 | (2,823) | |
Gain on sale of discontinued operations | (1,092) | (1,102) | |
Impairment of long-lived assets | 11,425 | ||
Pension funding required by Innovative acquisition | (22,494) | ||
Other non-cash activity | 566 | ||
Loss on deconsolidation of subsidiary | 19,937 | ||
Changes in operating assets and liabilities, excluding the effects of acquisitions: | |||
Accounts receivable | 2,601 | 11,744 | (15,264) |
Materials and supplies, prepayments, and other current assets | (8,410) | (1,094) | (4,817) |
Income tax receivable | (2,620) | ||
Accounts payable and accrued liabilities, advance payments and deposits and other current liabilities | 6,522 | (2,385) | 7,629 |
Accrued taxes | 21,547 | 9,740 | (15,650) |
Other assets | (12,122) | (134) | (1,833) |
Other liabilities | 15,371 | (9,360) | |
Net cash provided by operating activities of continuing operations | 111,656 | 139,080 | 82,699 |
Net cash provided by operating activities of discontinued operations | 158 | (4,719) | |
Net cash provided by operating activities | 111,656 | 139,238 | 77,980 |
Cash flows from investing activities: | |||
Capital expenditures | (124,282) | (64,753) | (58,300) |
Purchase of marketable securities | (2,000) | ||
Acquisition of businesses, net of acquired cash of $12.6 million, $0.0 million, and $6.6 million | (146,395) | (11,968) | (50,361) |
Restricted cash acquired from acquisition of business | (5,884) | ||
Purchases of spectrum licenses and other intangible assets, including deposits | (10,860) | ||
Acquisition of non-controlling interest in subsidiary | (7,045) | ||
Purchase of short-term investments | (7,422) | ||
Change in restricted cash | (12,108) | 38,877 | 38,707 |
Proceeds from disposition of long-lived assets | 1,424 | 5,873 | 1,371 |
Net cash used in investing activities of continuing operations | (308,688) | (31,971) | (74,467) |
Cash flows from financing activities: | |||
Dividends paid on common stock | (20,965) | (19,070) | (17,488) |
Proceeds from issuance of debt | 125,800 | ||
Distribution to non-controlling stockholders | (8,632) | (16,514) | (16,331) |
Payment of debt issuance costs | (2,763) | (892) | (1,945) |
Proceeds from stock option exercises | 649 | 1,998 | 1,129 |
Principal repayments of term loan | (33,564) | (6,017) | |
Purchase of common stock | (4,114) | (1,893) | (1,665) |
Repurchases of non-controlling interests | (3,485) | (104) | |
Investments made by minority shareholders in consolidated affiliates | 22,408 | 950 | 2,500 |
Net cash provided by (used in) financing activities | 75,334 | (41,438) | (33,904) |
Effect of foreign currency exchange rates on cash and cash equivalents | (626) | ||
Net change in cash and cash equivalents | (122,324) | 65,829 | (30,391) |
Cash and cash equivalents, beginning of period | 392,045 | 326,216 | 356,607 |
Cash and cash equivalents, end of period | 269,721 | 392,045 | 326,216 |
Supplemental cash flow information: | |||
Interest paid | 4,451 | 2,724 | 2,930 |
Taxes paid | 8,237 | 9,636 | 48,349 |
Dividends declared, not paid | 5,487 | 5,141 | 4,618 |
Noncash investing activity | |||
Purchases of property and equipment included in accounts payable and accrued expenses | $ 16,847 | $ 7,705 | $ 5,136 |
CONSOLIDATED STATEMENTS OF CA11
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
Cash acquired from acquisition | $ 12.6 | $ 0 | $ 6.6 |
ORGANIZATION AND BUSINESS OPERA
ORGANIZATION AND BUSINESS OPERATIONS | 12 Months Ended |
Dec. 31, 2016 | |
ORGANIZATION AND BUSINESS OPERATIONS | |
ORGANIZATION AND BUSINESS OPERATIONS | 1. ORGANIZATION AND BUSINESS OPERATION 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) develops, owns and operates commercial distributed generation solar power systems in the United States and India, and (iii) owns and operates terrestrial and submarine fiber optic transport systems in the United States and the Caribbean. 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 offer wireless voice and data services to retail customers in Bermuda, Guyana, the U.S. Virgin Islands and in other smaller markets in the Caribbean and the United States. · Wireline. The Company’s wireline services include local telephone and data services in Bermuda, Guyana, the U.S. Virgin Islands, and in other smaller markets in the Caribbean and the United States. Our wireline services also include video services in Bermuda and the U.S Virgin Islands. As of December 31, 2016, the Company also offered facilities‑based integrated voice and data communications services and wholesale transport services to enterprise and residential customers in New England, primarily 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. Beginning in April 2016, the Company began developing projects in India to provide distributed generation solar power to corporate and utility customers The following chart summarizes the operating activities of the Company’s principal subsidiaries, the segments in which it reports its revenue and the markets it served as of December 31, 2016: Segment Services Markets Tradenames U.S. Telecom Wireless United States (rural markets) Commnet, Choice, Choice NTUA Wireless Wireline United States (New England and New York State) Sovernet, ION, Essextel International Telecom Wireline Guyana, Bermuda, U.S. Virgin Islands GTT+, One, Innovative, Logic Wireless Bermuda, Guyana, U.S. Virgin Islands One, GTT+, Innovative, Choice Video Services Bermuda, U.S. Virgin Islands, Cayman Islands, British Virgin Islands, St. Maarten One, Innovative, Logic, BVI Cable TV Renewable Energy Solar United States and India Ahana Renewables, Vibrant Energy The Company actively evaluates 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. Management fees from subsidiaries are eliminated in consolidation. To be consistent with how management allocates resources and assesses the performance of its business operations in 2016, the Company updated its reportable operating segments in the first quarter of the year to consist of the following: i) U.S. Telecom, consisting of the Company’s former U.S. Wireless and U.S. Wireline segments, ii) International Telecom, consisting of the Company’s former Island Wireless and International Integrated Telephony segments and the results of its One Communications and Innovative Acquisitions as discussed below, and iii) Renewable Energy, consisting of the Company’s former Renewable Energy segment and the results of its Vibrant Energy Acquisition. The prior year segment information has been recast to conform to the current year’s segment presentation. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation 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 December 31, 2015 financial statements to conform to the Company’s consolidated income statements to how it analyzes its operations in the current period. These changes did not impact operating income. For the year ended December 31, 2015 the aggregate impact of the changes included an increase to termination and access fees of $4.1 million, a decrease to engineering and operations expenses of $2.3 million, a decrease to sales and marketing expenses of $2.4 million and an increase to general and administrative expenses of $0.5 million. During the year ended December 31, 2016, the Company’s other assets increased primarily due to a deposit to purchase spectrum licenses, a $2.0 million purchase of securities in an unaffiliated entity, $2.1 million of assets acquired in the One Communications Acquisition, and $7.6 million of assets acquired in the Innovative Transaction, and $6.3 million related to operations in the Renewable Energy segment. 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 business combinations, fair value of indefinite-lived intangible assets, goodwill and income taxes. Actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all investments with an original maturity of three months or less at date of purchase to be cash equivalents. The Company places its cash and temporary investments with banks and other institutions that it believes have a high credit quality. At December 31, 2016, the Company had deposits with banks in excess of FDIC insured limits and $24.3 million of its cash is on deposit with non‑insured institutions such as corporate money market issuers and cash held in foreign banks. The Company’s cash and cash equivalents are not subject to any restrictions (see Note 8). As of December 31, 2016 and 2015, the Company held $7.5 million and $3.8 million, respectively, of its cash in Guyana dollars. While there are risks associated with the conversion of Guyana dollars to U.S. dollars due to limited liquidity in the Guyana foreign currency markets, to date it has not prevented the Company from converting Guyana dollars into U.S. dollars within a given three month period or from converting at a price that reasonably approximates the reported exchange rate. Short Term Investments The Company's short-term investments consist of corporate bonds, which have remaining maturities of more than three months at the date of purchase, and equity securities classified as available for sale, which are stated at fair value. Unrealized gains and losses, net of related income taxes, for available for sale securities are reported as net increases and decreases to accumulated other comprehensive income (loss) until realized. The estimated fair values of investments are based on quoted market prices as of the end of the reporting period. The corporate bonds as of December 31, 2016 have contractual maturities of less than one year. Restricted Cash The majority of the Company’s restricted cash balance is held in the Company’s Ahana Renewables subsidiary as described in Note 3. The restricted cash is held in escrow and serves as collateral for Ahana Renewables’ debt in order to meet future debt service obligations and other operating obligations of the solar facilities. Allowance for Doubtful Accounts The Company maintains an allowance for doubtful accounts for the estimated probable losses on uncollectible accounts receivable. The allowance is based upon a number of factors including the credit worthiness of customers, the Company’s historical experience with customers, the age of the receivable and current market and economic conditions. Such factors are reviewed and updated by the Company on a quarterly basis. Uncollectible amounts are charged against the allowance account. Materials and Supplies Materials and supplies primarily include handsets, customer premise equipment, cables and poles and are recorded at the lower of cost or market cost being determined on the basis of specific identification and market determined using replacement cost. Fixed Assets The Company’s fixed assets are recorded at cost and depreciated using the straight‑line method generally between 3 and 39 years. Expenditures for major renewals and betterments that extend the useful lives of fixed assets are capitalized. Repairs and replacements of minor items of property are charged to maintenance expense as incurred. The cost of fixed assets in service and under construction includes an allocation of indirect costs applicable to construction. Grants received for the construction of assets are recognized as a reduction of the cost of fixed assets, a reduction of depreciation expense over the useful lives of the assets and as a reduction of capital expenditures in the statements of cash flows. The fair value of a liability for an asset retirement obligation is recorded in the period in which it is incurred if a reasonable estimate of fair value can be made. In periods subsequent to initial measurement, period‑to‑period changes in the liability for an asset retirement obligation resulting from the passage of time and revisions to either the timing or the amount of the original estimate of undiscounted cash flows are recognized. The increase in the carrying value of the associated long‑lived asset is depreciated over the corresponding estimated economic life. The consolidated balance sheets include accruals of $3.2 million and $3.0 million as of December 31, 2016 and 2015, respectively, for estimated costs associated with asset retirement obligations. In accordance with the authoritative guidance for the accounting for the impairment or disposal of long‑lived assets, the Company evaluates the carrying value of long‑lived assets, including property and equipment, in relation to the operating performance and future undiscounted cash flows of the underlying business whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss exists when estimated undiscounted cash flows attributable to an asset are less than its carrying amount. If an asset is deemed to be impaired, the amount of the impairment loss recognized represents the excess of the asset’s carrying value as compared to its estimated fair value, based on management’s assumptions and projections. Management’s estimate of the future cash flows attributable to its long‑lived assets and the fair value of its businesses involve significant uncertainty. Those estimates are based on management’s assumptions of future results, growth trends and industry conditions. If those estimates are not met, the Company could have additional impairment charges in the future, and the amounts may be material. See Note 3, Pending Disposition- U.S. Telecom, regarding the Company’s impairment of certain fixed assets. Goodwill and Indefinite‑Lived Intangible Assets Goodwill is the amount by which the cost of acquired net assets exceeded the fair value of those net assets on the date of acquisition. The Company allocates goodwill to reporting units at the time of acquisition and bases that allocation on which reporting units will benefit from the acquired assets and liabilities. Reporting units are defined as operating segments or one level below an operating segment, referred to as a component. The Company has determined that its reporting units are components of its multiple operating segments. The Company assesses goodwill for impairment on an annual basis in the fourth quarter or more frequently when events and circumstances occur indicating that the recorded goodwill may be impaired. If the book value of a reporting unit exceeds its fair value, the implied fair value of goodwill is compared with the carrying amount of goodwill. If the carrying amount of goodwill exceeds the implied fair value, an impairment loss is recorded equal to that excess. A significant majority of the Company’s telecommunications licenses are not amortized and are carried at their historical costs. The Company believes that telecommunications licenses generally have an indefinite life based on the historical ability to renew such licenses, that such renewals may be obtained indefinitely and at little cost, and that the related technology used is not expected to be replaced in the foreseeable future. The Company has elected to perform its annual testing of its telecommunications licenses in the fourth quarter of each fiscal year, or more often if events or circumstances indicate that there may be impairment. If the value of these assets were impaired by some factor, such as an adverse change in the subsidiary’s operating market, the Company may be required to record an impairment charge. The impairment test consists of a comparison of the fair value of telecommunications licenses with their carrying amount on a license by license basis and as a part of the test the Company assesses the appropriateness of the application of the indefinite‑lived assertion. As of December 31, 2016 and 2015, the Company performed its annual impairment assessment of its goodwill and indefinite‑lived intangible assets (telecommunications licenses) and determined that no impairment charge was required. See Note 7 for a discussion of the Company’s quantitative and qualitative tests of its goodwill. See Note 3, Pending Disposition- U.S. Telecom, regarding the Company’s impairment of certain fixed assets and goodwill. Other Intangible Assets Intangible assets resulting from the acquisitions of entities accounted for using the purchase method of accounting are estimated by management based on the fair value of assets acquired. These include acquired customer relationships, tradenames, and franchise rights. Customer relationships are amortized over their estimated lives ranging from 7-13 years, which are based on the pattern in which economic benefit of the customer relationship is estimated to be realized. Debt Debt is measured at amortized cost. Debt issuance costs on term loans and specified maturity borrowings are recorded as a reduction to the carrying value of the debt and are amortized as interest expense in the consolidated income statements over the period of the debt. Fees related to revolving credit facilities and lines of credit are recorded in other assets in the consolidated balance sheet and are amortized as interest expense in the consolidated income statements over the life of the facility. Except for interest costs incurred for the construction of a qualifying asset which are capitalized during the period the assets are prepared for their intended use, interest costs are expensed. Non‑Controlling Interests The non‑controlling interests in the accompanying consolidated balance sheets reflect the original investments by the minority stockholders in GTT, Commnet’s consolidated subsidiaries, One Communications, Innovative, Sovernet and its consolidated subsidiaries and Ahana Renewables, along with their proportional share of the earnings or losses, net of any distributions. Changes in Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss), by component, were as follows (in thousands): Projected Pension Benefit Translation Short Term Obligation Adjustment Investment Total Balance at December 31, 2013 $ — Adjust funded status of pension plan, net of tax of $0.6 million — — Foreign currency translation adjustment — — Balance at December 31, 2014 — Adjust funded status of pension plan, net of tax of $0.7 million — — Foreign currency translation adjustment — — Balance at December 31, 2015 — Adjust funded status of pension plan, net of tax of $0.7 million — — Foreign currency translation adjustment — — Unrealized gain on marketable securities — — Balance at December 31, 2016 $ $ $ $ Amounts totaling $1.3 million, $0.2 million, and $0.2 million were reclassified from other comprehensive income to general and administrative operating expense related to the Company’s defined pension plans for the years ending December 31, 2016, 2015, and 2014, respectively . Revenue Recognition- Telecommunications Service revenues are primarily derived from providing access to and usage of the Company’s networks and facilities. Access revenues from postpaid customers are generally billed one month in advance and are recognized over the period that the corresponding service is rendered to customers. Revenues derived from usage of the Company’s networks, including airtime, roaming, long‑distance and Universal Service Fund revenues, are recognized when the services are provided and are included in unbilled revenues until billed to the customer. Prepaid airtime sold to customers is recorded as deferred revenue prior to the commencement of services and is recognized when the airtime is used or expires. The Company offers enhanced services including caller identification, call waiting, call forwarding, three‑way calling, voice mail, and text and picture messaging, as well as downloadable wireless data applications, including ringtones, music, games, and other informational content. Generally, these enhanced features generate additional service revenues through monthly subscription fees or increased usage through utilization of the features. Other optional services such as equipment protection plans may also be provided for a monthly fee and are either sold separately or bundled and included in packaged rate plans. Revenues from enhanced features and optional services are recognized when earned. Access and usage‑based services are billed throughout the month based on the bill cycle assigned to a particular customer. As a result of billing cycle cut‑off times, management must estimate service revenues earned but not yet billed at the end of each reporting period. Sales of communications products including wireless handsets and accessories represent a separate earnings process and are recognized when the products are delivered to and accepted by customers. The Company accounts for transactions involving both the activation of service and the sale of equipment in accordance with the authoritative guidance for the accounting for revenue arrangements with multiple deliverables. Fees assessed to communications customers to activate service are not a separate unit of accounting and are allocated to the delivered item (equipment) and recognized as product sales to the extent that the aggregate proceeds received from the customer for the equipment and activation fee do not exceed the relative fair value of the equipment. Commissions paid to third parties are expensed as incurred and included in sales and marketing expenses. Wholesale revenues are those revenues generated from providing voice or data services to the customers of other wireless carriers principally through “roaming” agreements, and the revenue is recognized over the period that the service is rendered to customers. Sales and use and state excise taxes collected from customers that are remitted to the governmental authorities are reported on a net basis and excluded from the revenues and sales. Revenue Recognition-Renewable Energy Revenue from the Company’s Renewable Energy segment is generated from the sale of electricity through long-term power purchase agreements (“PPA’s”) with various customers, or hosts, that range from 10 to 25 years. The Company, which is required to sell all generated power to the hosts, recognizes revenue from the PPA’s as electricity is generated and sold at contractual rates as defined within the respective PPA. The Company’s Renewable Energy segment also generates revenue from the sale of Solar Renewable Energy Credits (“SRECs”). Revenue is recognized as SRECs are sold through long-term purchase agreeements at the contractual rate specified in the agreement. Expenses Termination and access fee expenses. Termination and access fee expenses are charges that are incurred for voice and data transport circuits (in particular, the circuits between the Company’s wireless sites and its switches), internet capacity, other access fees incurred to terminate calls, customer bad debt expense, telecommunication spectrum fees and direct costs associated with the Company’s Renewable Energy segment. Engineering and operations expenses. Engineering and operations expenses include the expenses associated with developing, operating and supporting the Company’s expanding telecommunications networks and renewable energy operations, including the salaries and benefits incurred to employees directly involved in the development and operation of the Company’s networks and renewable energy operations. Sales and marketing expenses. Sales and marketing expenses include salaries and benefits incurred to sales personnel, customer service expenses, sales commissions and the costs associated with the development and implementation of promotion and marketing campaigns. Equipment expenses. Equipment expenses include the costs of handset and customer resale equipment in the Company’s retail businesses. General and administrative expenses. General and administrative expenses include salaries, benefits and related costs for general corporate functions including executive management, finance and administration, legal and regulatory, facilities, information technology and human resources. General and administrative expenses also include internal costs associated with the Company’s performance of due-diligence in connection with acquisition activities. Transaction-related charges. Transaction-related charges include the external costs, such as legal, tax, accounting and consulting fees directly associated with acquisition and disposition-related activities. Transaction-related charges do not include internal costs, such as employee salary and travel-related expenses, incurred in connection with acquisitions or dispositions or any integration-related costs. Restructuring charges. Restructuring charges include costs incurred in integrating our newly acquired Companies. Depreciation and amortization expenses. Depreciation and amortization expenses represent the depreciation and amortization charges recorded on our property and equipment and intangible assets. Impairment of goodwill and long-lived assets. The Company evaluates the carrying value of its long‑lived assets, including property and equipment, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss exists when estimated undiscounted cash flows attributable to non‑current assets subject to depreciation and amortization and discounted cash flows for intangible assets not subject to amortization are less than their carrying amount. If an asset is deemed to be impaired, the amount of the impairment loss recognized represents the excess of the asset’s carrying value as compared to its estimated fair value, based on management’s assumptions and projections. The Company also assesses the carrying value of goodwill and indefinite‑lived intangible assets on an annual basis or more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable. The carrying value of each reporting unit, including goodwill assigned to that reporting unit, is compared to its fair value. If the fair value of the reporting unit does not exceed the carrying value of the reporting unit, including goodwill, an analysis is performed to determine if an impairment charge should be recorded. Accounting for Grants The Company has received funding from the U.S. Government and its agencies under Stimulus and Universal Service Fund programs. These funding programs are generally designed to fund telecommunications infrastructure expansion into rural or underserved areas of the United States. The funding programs are evaluated to determine if they represent funding related to capital expenditures (capital grants) or operating activities (income grants). Funding received from Stimulus programs is on a cost‑reimbursement basis for capital expenditures incurred by the Company to expand its network and is considered a capital grant. Accordingly, reimbursements for eligible expenditures under the Stimulus programs are recorded as a reduction to property, plant and equipment on the Company’s consolidated balance sheets, an investing cash inflow and a future reduction in depreciation expense in the consolidated income statements. The depreciable period for the grant is commensurate with the related assets which typically range from 5 to 20 years. As of December 31, 2016, the Company has spent $99.3 million in capital expenditures of which $73.9 million has been or will be funded by the Stimulus programs. Accordingly, funding received for capital expenditures from the Stimulus Programs is recorded as a reduction to property, plant and equipment on the Company’s consolidated balance sheets, an investing cash inflow within capital expenditures and a future reduction in depreciation expense in the consolidated income statements. Funding received for operating costs is recorded as a reduction to the Company’s operating expenses in its consolidated statements of income and an operating cash inflow. Funding received from Universal Service Fund programs is received over time for operating the Company’s network in certain rural geographical areas and is considered an income grant. Accordingly, such funding is recognized as operating cash inflows. Once services are provided, revenue is recognized in the Company’s consolidated income statements. During the year ended December 31, 2016 and December 31, 2015 the Company received approximately $17.7 million and $7.9 million, respectively, from the Universal Service Fund programs. Of these amounts, $9.5 million for the year ended December 31, 2016 and $1.3 million for the year ended December 31, 2015 were to support our U.S. Wireless business relating to high‑cost areas. Funding received from the Phase I Mobility Fund, as further described in Note 9, is for the use of both capital expenditures and operating costs incurred by the Company. Accordingly, funding received for capital expenditures from the Phase I Mobility Fund is recorded as a reduction to property, plant and equipment on the Company’s consolidated balance sheets, an investing cash inflow within capital expenditures and a future reduction in depreciation expense in the consolidated income statements. Funding received for operating costs is recorded as a reduction to the Company’s operating expenses in its consolidated income statements and an operating cash inflow. Compliance with grant requirements is reviewed as of December 31, of each year to ensure that conditions related to grants have been met and there is reasonable assurance that the Company will be able to retain the grant proceeds and to ensure that any contingencies that may arise from not meeting the conditions are appropriately recognized. Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax‑planning strategies, and results of recent operations. If the Company determines that it would be able to realize our deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process whereby (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more‑likely‑than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related authority. It is possible that the ultimate resolution of these uncertain matters may be greater or less than the amount that the Company estimated. If payment of these amounts proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period in which it is determined that the liabilities are no longer necessary. If the estimate of tax liabilities proves to be more than the ultimate assessment, a further charge to expense would result. The Company recognizes interest and penalties related to unrecognized tax benefits within the income tax expense line in the accompanying consolidated statements of operations. Accrued interest and penalties are included within the related tax liability line in the consolidated balance sheets. The Company does not provide for United States income taxes on earnings of foreign subsidiaries as such earnings are considered to be indefinitely reinvested. As of December 31, 2014, the Company had deferred taxes that were classified as current and noncurrent assets and liabilities. The Company elected to prospectively adopt ASU 2015-17 as of December 31, 2015, thus reclassifying $3.9 million of current deferred tax assets and $0.2 million of current deferred tax liabilities to noncurrent on the accompanying consolidated December 31, 2015 balance sheet. The adoption of this guidance had no impact on the Company’s consolidated results of income and comprehensive income. Credit Concentrations and Significant Customers The Company has been historically dependent on a limited amount of customers for its wholesale roaming business. The following table indicates the percentage of revenues generated from a single customer that exceeds 10% of the Company’s consolidated revenue in any of the past three years: Customer 2016 2015 2014 Verizon % % % AT&T % % % No other customer accounted for more than 10% of consolidated revenue in any of the past three years. The following table indicates the percentage of accounts receivable, from customers that exceed 10% of the Company’s consolidated accounts receivable, net of allowances, as of December 31, 2016 and 2015: Customer 2016 2015 AT&T % % Verizon % % Foreign Currency Gains and Losses We translate the assets and liabilities of our foreign subsidiaries from their respective functional currencies, primarily the Indian Rupee and the Guyana Dollar, to U.S. dollars at the appropriate spot rates as of the balance sheet date. Changes in the carrying value of these assets and liabilities attributable to fluctuations in spot rates are recognized in foreign currency translation adjustment, a component of AOCI. Income statement accounts are translated using the monthly average exchange rates during the year. Monetary assets and liabilities denominated in a currency that is different from a reporting entity’s functional currency must first be remeasured from the applicable currency to the legal entity’s functional currency. The effect of this remeasurement process is reported in other income on the income statement. Employee Benefit Plans The company sponsors pension and other postretirement benefit plans for employees of certain subsidiaries. Net periodic pension expense is recognized in the Company’s income statement. The Company recognizes a pension or other postretirement plan’s funded status as either an asset or liability in its consolidated balance sheet. Actuarial gains and losses are reported as a component of other comprehensive income and amortized through net periodic pension expense in subsequent periods. Fair Value of Financial Instruments 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, 2016 and 2015 are summarized as follows: December 31, 2016 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Short term investments $ $ $ Commercial Paper $ — $ $ Total assets measured at fair value $ $ $ December 31, 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, 2016 and December 31, 2015, this asset class consisted of a time deposit at a financial institution denominated in U.S. dollars. The asset class |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 12 Months Ended |
Dec. 31, 2016 | |
ACQUISITIONS AND DISPOSITIONS | |
ACQUISITIONS AND DISPOSITIONS | 3. ACQUISITIONS AND DISPOSITIONS International Telecom One Communications (formerly KeyTech Limited) On May 3, 2016, the Company completed our acquisition of a controlling interest in KeyTech Limited (“KeyTech”), a publicly held Bermuda company listed on the Bermuda Stock Exchange (“BSX”) that provides broadband and video services and other telecommunications services to residential and enterprise customers under the “Logic” name in Bermuda and the Cayman Islands. Subsequent to the completion of our acquisition of KeyTech, KeyTech changed its name, and the “Logic” name, to One Communications Ltd (“One Communications”). Prior to our acquisition, One Communications also owned a minority interest of approximately 43% in the Company’s consolidated subsidiary, Bermuda Digital Communications Ltd. (“BDC”), which provides wireless services in Bermuda under the “CellOne” name. As part of the transaction, the Company contributed its ownership interest of approximately 43% in BDC and approximately $42 million in cash in exchange for a 51% ownership interest in One Communications. As part of the transaction, BDC was merged with and into a company within the One Communications group and the approximate 15% interest in BDC held, in the aggregate, by BDC’s minority shareholders was converted into the right to receive common shares in One Communications. Following the transaction, BDC became wholly owned by One Communications, and One Communications continues to be listed on the BSX. A portion of the cash proceeds that One Communications received upon closing was used to fund a one-time special dividend to One Communications’ existing shareholders and to retire One Communications subordinated debt. On May 3, 2016, the Company began consolidating the results of One Communications within our financial statements in our International Telecom segment. The One Communications Acquisition was accounted for as a business combination of a controlling interest in One Communications in accordance with ASC 805, Business Combinations , and the acquisition of an incremental ownership interest in BDC in accordance with ASC 810, Consolidation . The total purchase consideration of $41.6 million of cash was allocated to the assets acquired and liabilities assumed at their estimated fair values as of the date of the acquisition. Consideration Transferred Cash consideration - KeyTech $ Cash consideration - BDC Total consideration transferred Non-controlling interests - KeyTech Total value to allocate $ Value to allocate KeyTech Value to allocate - BDC Purchase price allocation KeyTech: Cash Accounts receivable Other current assets Property, plant and equipment Identifiable intangible assets Other long term assets Accounts payable and accrued liabilities Advance payments and deposits Current debt Long term debt Net assets acquired Gain on KeyTech bargain purchase $ Purchase price allocation BDC: Carrying value of BDC non-controlling interest acquired Excess of purchase price paid over carrying value of non-controlling interest acquired $ The acquired property, plant and equipment is comprised of telecommunication equipment located in Bermuda and the Cayman Islands. The property, plant and equipment was valued using the income and cost approaches. Cash flows were discounted at approximately 15% rate to determine fair value under the income approach. The property, plant and equipment have useful lives ranging from 3 to 18 years and the customer relationships acquired have useful lives ranging from 9 to 12 years. The fair value of the non-controlling interest was determined using the income approach and a discount rate of approximately 15%. The acquired receivables consist of trade receivables incurred in the ordinary course of business. The Company has collected the full amount of the receivables. The purchase price and resulting bargain purchase gain are the result of the market conditions and competitive environment in which One Communications operates along with the Company's strategic position and resources in those same markets. Both companies realized that their combined resources would accelerate the transformation of both companies to better serve customers in these markets. The bargain purchase gain is included in operating income in the accompanying income statement for the year ended December 31, 2016. The Company’s income statement for the year ended December 31, 2016 includes $55.5 million of revenue and $2.8 million of income before taxes attributable to the One Communication Acquisition. The Company incurred $4.3 million of transaction related charges pertaining to legal, accounting and consulting services associated with the transaction, of which $3.4 million were incurred during the year ended December 31, 2016. Innovative On July 1, 2016, the Company completed its acquisition of all of the membership interests of Caribbean Asset Holdings LLC (“CAH”), the holding company for the Innovative group of companies operating video services, Internet, wireless and landline services in the U.S. Virgin Islands, British Virgin Islands and St. Maarten (“Innovative”), from the National Rural Utilities Cooperative Finance Corporation (“CFC”). The Company acquired the Innovative operations for a contractual purchase price of $145.0 million, reduced by purchase price adjustments of $5.3 million (the “Innovative Transaction”). In connection with the transaction, the Company financed $60.0 million of the purchase price with a loan from an affiliate of CFC, the Rural Telephone Finance Cooperative (“RTFC”) on the terms and conditions of a Loan Agreement by and among RTFC, CAH and ATN VI Holdings, LLC, the parent entity of CAH and a wholly-owned subsidiary of the Company. The Company funded $51.9 million of the purchase price in cash, subsequently paid $22.5 million to fund Innovative’s pension in the fourth quarter of 2016, and recorded $5.3 million as restricted cash to satisfy Innovative’s other postretirement benefit plans. Following the purchase, the Company’s current operations in the U.S. Virgin Islands under the “Choice” name will be combined with Innovative to deliver residential and business subscribers a full range of telecommunications and media services. On July 1, 2016, the Company began consolidating the results of Innovative within its financial statements in its International Telecom segment. The Innovative Transaction was accounted as a business combination in accordance with ASC 805. The consideration transferred of $111.9 million, and used for the purchase price allocation, differed from the contractual purchase price of $145.0 million, due to certain GAAP purchase price adjustments including a reduction of $5.3 million related to working capital adjustments and the Company agreeing to subsequently settle assumed pension and other postretirement benefit liabilities of $27.8 million. As of December 31 2016, the Company transferred consideration of $111.9 million which was allocated to the assets acquired and liabilities assumed at their estimated fair values as of the date of the acquisition. The final purchase price represents a reduction of $0.4 million from the preliminary purchase price. The decrease was due to settlement of working capital adjustments. The table below represents the allocation of the consideration transferred to the net assets of Innovative based on their acquisition date fair values: Consideration Transferred $ Non-controlling interests Total value to allocate Purchase price allocation: Cash Accounts receivable Materials & supplies Other current assets Property, plant and equipment Telecommunication licenses Goodwill Intangible assets Other Assets Accounts payable and accrued liabilities Advance payments and deposits Deferred tax liability Pension and other postretirement benefit liabilities Net assets acquired $ The acquired property, plant and equipment is comprised of telecommunication equipment located in the U.S Virgin Islands, British Virgin Islands and St. Maarten. The property, plant and equipment was valued using the income and cost approaches. Cash flows were discounted between 14% and 25% based on the risk associated with the cash flows to determine fair value under the income approach. The property, plant and equipment have useful lives ranging from 1 to 18 years and the customer relationships acquired have useful lives ranging from 7 to 13 years. The fair value of the non-controlling interest was determined using the income approach with discount rates ranging from 15% to 25%. The acquired receivables consist of trade receivables incurred in the ordinary course of business. The Company has collected the full amount of the receivables. The Company recorded a liability equal to the funded status of the plans in its purchase price allocation. Discount rates between 3.6% and 3.9% were used to determine the benefit obligation. The goodwill generated from the Innovative Transaction is primarily related to value placed on the acquired employee workforces, service offerings, and capabilities of the acquired businesses as well as expected synergies from future combined operations. The goodwill is not deductible for income tax purposes. The Company acquired Innovative’s pension and other postretirement benefit plans as part of the transaction. The plans cover employees located in the U.S. Virgin Islands and consist of noncontributory defined benefit pension plans and noncontributory defined medical, dental, vision and life benefit plans. As noted above, the contractual purchase price included an adjustment related to the funded status of Innovative’s pension and other postretirement benefit plans. As contemplated by the transaction, the Company contributed approximately $22.5 million during the fourth quarter of 2016 to Innovative’s pension plans. This payment is recorded as a cash outflow from operations in the statement of cash flows. At December 31, 2016, the Company held $5.1 million of restricted cash equal to the unfunded status of the other postretirement benefit plans. The cash is restricted due to the Company’s intent to use the cash to satisfy future postretirement benefit obligations and the specific nature of the commitment The Company’s income statement for year ended December 31, 2016 includes $53.0 million of revenue and $1.5 million of income before taxes attributable to the Innovative Transaction. The Company incurred $4.1 million of transaction related charges pertaining to legal, accounting and consulting services associated with the transaction, of which $2.2 million were incurred during the year ended December 31, 2016. Disposition In September 2016, the Company entered into an agreement to sell the Innovative cable operations located in St.Maarten. The transaction was complete on January 3, 2017 and will be recorded in the Company’s 2017 results. The Company does not expect to recognize a gain or loss on the transaction. Since the disposition does not relate to a strategic shift in our operations, the subsidiary’s historical results and financial position are presented within continuing operations. During March 2015, the Company sold certain assets and liabilities of our Turks and Caicos business in its International Telecom segment. As a result, we recorded a net loss of approximately $19.9 million, which is included in other income (expense) on its statement of operations, arising from the deconsolidation of non-controlling interests of $20.0 million partially offset by a gain of $0.1 million arising from an excess of the sales proceeds over the carrying value of net assets disposed of. Since the disposition does not relate to a strategic shift in our operations, the subsidiary’s historical results and financial position are presented within continuing operations. Deconsolidation of Subsidiary On December 15, 2016, the Company transferred control of its subsidiary in Aruba to another stockholder in a nonreciprocal transfer. Subsequent to that date, it no longer consolidated the results of the operations of the Aruba business which generated $2.8 million in revenues during the year ended December 31, 2016. The Company did not recognize a gain or loss on the transaction. Pro forma Results The following table reflects unaudited pro forma operating results of the Company for the year ended December 31, 2016 and December 31, 2015 assuming that the One Communications and Innovative Transactions occurred at the beginning of each period presented. The pro forma amounts adjust One Communications’ and Innovative’s results to reflect the depreciation and amortization that would have been recorded assuming the fair value adjustments to property, plant and equipment and intangible assets had been applied from January 1, 2015. Also, the pro forma results were adjusted to reflect changes to the acquired entities’ financial structure related to the transaction. One Communications’ results reflect the retirement of $24.7 million of debt. Innovative’s results reflect the retirement of $185.8 million of debt and the addition of $60 million of purchase price debt. Finally, ATN’s results were adjusted to reflect ATN’s incremental ownership in BDC. The pro forma results do not include the Company’s US Telecom or Renewable Energy acquisitions because they are immaterial both individually and in the aggregate to the Company’s historical results. The pro forma results for the year ended December 31, 2016 include $5.4 million of impairment charges, $4.3 million recorded by One Communications and $1.1 million recorded by Innovative. The pro forma results for the year ended December 31, 2015 include $168.7 million of impairment charges, $85.6 million recorded by One Communications and $83.1 million recorded by Innovative. Both the 2016 and 2015 impairment charges were recorded prior to ATN’s acquisition of the entities. Amounts are presented in thousands, except per share data: Year ended December 31, (unaudited) 2016 2015 As Pro- As Pro- Reported Forma Reported Forma Revenue $ $ $ $ Net income (loss) attributable to ATN International, Inc. Stockholders Earnings per share: Basic Diluted The unaudited pro forma data is presented for illustrative purposes only and is not necessarily indicative of the operating resulted that would have occurred if the acquisitions had been consummated on these dates or of future operating results of the combined company following this transaction. U.S. Telecom In July 2016, the Company acquired certain telecommunications fixed assets and the associated operations located in the western United States. The acquisition qualified as a business combination for accounting purposes. The Company transferred $9.1 million of cash consideration in the acquisition. The consideration transferred was allocated to $10.2 million of acquired fixed assets, $3.5 million of deferred tax liability, and $0.7 million to other net liabilities, resulting in goodwill of $3.1 million. The deferred tax liability and goodwill increased by $2.7 million from the preliminary purchase price allocation due to a measurement period adjustment. The adjustment had no impact on the Company’s income. Results of operations for the business are included in the U.S. Telecom segment and are not material to the Company’s historical results of operations. Pending Disposition During June 2016, as a result of recent industry consolidation activities and a review of strategic alternatives for the Company’s U.S. Wireline business in the Northeast, the Company identified factors indicating the carrying amount of certain assets may not be recoverable. More specifically, the factors included the competitive environment, recent industry consolidation, and the Company’s view of future opportunities in the market which began to evolve in the second quarter of 2016. On August 4, 2016, the Company entered into a stock purchase agreement to sell the majority of its U.S. Wireline business. The transaction is subject to customary closing conditions. As a result of this transaction and the recent developments in the market, the Company determined it was appropriate to assess the reporting unit’s assets for impairment. The reporting unit holds three types of assets for purposes of impairment testing: i) other assets such as accounts receivable and inventory, ii) long lived assets such as property plant and equipment, and iii) goodwill. Management first assessed the other assets for impairment and determined no impairment was appropriate. Second, the property, plant and equipment was assessed for impairment. The assessment compared the undiscounted cash flows from the use and eventual disposition of the asset group to its carrying amount and determined the carrying amount was not recoverable. The asset group represents the lowest level of assets with identifiable independent cash flows. The impairment loss of $3.6 million was equal to the amount by which the carrying amount exceeded the fair value. Third, management assessed goodwill for impairment following the two step impairment test. The carrying amount of the reporting unit exceeded its fair value, after considering the $3.6 million asset impairment. The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of goodwill to measure the amount of impairment loss. The impairment loss equaled $7.5 million. The Company utilized the income approach, with Level 3 valuation inputs, which considered both the purchase agreement and cash flows discounted at a rate of 14% in its fair value calculations. In total, the Company recorded an impairment charge of $11.1 million. The impairment charge is included in income from operations for the year ended December 31, 2016. Renewable Energy Vibrant Energy On April 7, 2016, the Company completed its acquisition of a solar power development portfolio in India from Armstrong Energy Global Limited (“Armstrong”), a well-known developer, builder, and owner of solar farms (the “Vibrant Energy Acquisition”). The business operates under the name Vibrant Energy. The Company also retained several Armstrong employees in the UK and India who are employed by the Company to oversee the development, construction and operation of the India solar projects. The projects to be developed initially are located in the states of Andhra Pradesh and Telangana and are based on a commercial and industrial business model, similar to the Company’s existing renewable energy operations in the United States. As of April 7, 2016, the Company began consolidating the results of Vibrant Energy in its financial statements within its Renewable Energy segment. The Vibrant Energy Acquisition was accounted for as a business combination in accordance with ASC 805. The total purchase consideration of $6.2 million cash was allocated to the assets acquired and liabilities assumed at their estimated fair values as of the date of the acquisition. The table below represents the allocation of the consideration transferred to the net assets of Vibrant Energy based on their acquisition date fair values (in thousands): Consideration Transferred $ Purchase price allocation: Cash $ Prepayments and other assets Property, plant and equipment Goodwill Accounts payable and accrued liabilities Net assets acquired $ The consideration transferred includes $3.5 million paid and $2.7 million payable at future dates, which is contingent upon the passage of time and achievement of initial production milestones which are considered probable. The acquired property, plant and equipment is comprised of solar equipment and the accounts payable and accrued liabilities consists mainly of amounts payable for certain asset purchases. The fair value of the property, plant, and equipment was based on recent acquisition costs for the assets, given their recent purchase dates from third parties. The goodwill is not deductible for income tax purposes and primarily relates to the assembled workforce of the business acquired. For the year ended December 31, 2016, the Vibrant Energy Acquisition accounted for $0.4 million of the Company’s revenue. The Company incurred $11.4 million of transaction related charges pertaining to legal, accounting and consulting services associated with the transaction, of which $10.1 million were incurred during the year ended December 31, 2016. Results of operations for the business are not material to the Company’s historical results of operations. |
DISCONTINUED OPERATIONS - SALE
DISCONTINUED OPERATIONS - SALE OF U.S. RETAIL WIRELESS BUSINESS | 12 Months Ended |
Dec. 31, 2016 | |
DISCONTINUED OPERATIONS - SALE OF U.S. RETAIL WIRELESS BUSINESS | |
DISCONTINUED OPERATIONS - SALE OF U.S. RETAIL WIRELESS BUSINESS | 4. DISCONTINUED OPERATIONS—SALE OF U.S. RETAIL WIRELESS BUSINESS On September 20, 2013, the Federal Communications Commission announced its approval of the previously announced proposed sale of the Company’s U.S. retail wireless business operated under the Alltel name to AT&T Mobility LLC for approximately $780.0 million in cash plus $16.8 million in working capital. The Company previously reported the operations of this business within its U.S. Wireless segment. During 2014 and 2015, the Company recognized an additional $1.1 million of gain relating to changes in certain estimates. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2016 | |
ACCOUNTS RECEIVABLE: | |
ACCOUNTS RECEIVABLE: | 5. ACCOUNTS RECEIVABLE: As of December 31, 2016 and 2015, accounts receivable consist of the following (in thousands): 2016 2015 Retail $ $ Wholesale Other Accounts receivable Less: allowance for doubtful accounts Total accounts receivable, net $ $ |
FIXED ASSETS
FIXED ASSETS | 12 Months Ended |
Dec. 31, 2016 | |
FIXED ASSETS: | |
FIXED ASSETS: | 6. FIXED ASSETS: As of December 31, 2016 and 2015, property, plant and equipment consisted of the following (in thousands): Useful Life (in Years) 2016 2015 Telecommunications equipment and towers 5 -15 $ $ Solar assets 20-23 Office and computer equipment 3 -10 Buildings 15-39 Transportation vehicles 3 -10 Leasehold improvements Shorter of useful Land — Furniture and fixtures 5 -10 Total property, plant and equipment Construction in progress Total property, plant and equipment Less: Accumulated depreciation Net fixed assets $ Depreciation and amortization of fixed assets, using the straight‑line method over the assets’ estimated useful life, for the years ended December 31, 2016, 2015 and 2014 was $73.3 million, $55.9 million and $50.3 million, respectively. Included within telecommunication equipment and towers are assets related to Indefeasible Rights of Use under capital lease with a cost of $13.8 million and $2.7 million and net book value of and $12.4 million and $1.8 million, as of December 31, 2016 and 2015, respectively. Remaining amounts due under the IRUs are $1.2 million and $0.0 million as of December 31, 2016 and 2015, respectively. During the year ended December 31, 2015, we sold certain network assets and telecommunications licenses in our U.S. Telecom segment and recognized a gain on such disposition of $2.8 million. For the years ended December 31, 2016, 2015 and 2014, amounts of capital expenditures were offset by grants of $2.3 million, $2.6 million and $2.3 million, respectively. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2016 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | 7. GOODWILL AND INTANGIBLE ASSETS Goodwill The Company tests goodwill for impairment on an annual basis, which has been determined to be as of December 31 of each fiscal year. The Company also tests goodwill between annual tests if an event occurs or circumstances change that indicate that the fair value of a reporting unit may be below its carrying value. The Company employs both qualitative and quantitative tests of its goodwill. The company tests goodwill at the reporting unit which is one level below its operating segments. During 2016, the Company performed a qualitative assessment for some of the Company’s reporting units and determined there were no indicators of impairment. For the other reporting units in 2016, goodwill was evaluated using a quantitative model. During 2015, the Company performed a qualitative assessment on goodwill to determine whether a quantitative assessment was necessary and determined there were no indicators of potential impairment. In 2014, the Company performed a qualitative assessment for some of the Company’s reporting units and determined there were no indicators of impairment. For the other reporting units in 2014, goodwill was evaluated using a quantitative model. The quantitative test for goodwill impairment is determined using a two‑step process. The first step involves a comparison of the estimated fair value of a reporting unit to its carrying amount, including goodwill. In performing the first step, the Company determines the fair value of a reporting unit using a discounted cash flow (“DCF”) analysis. Determining fair value requires the exercise of significant judgment, including judgments about appropriate discount rates, perpetual growth rates, and the amount and timing of expected future cash flows. Discount rates are based on a weighted‑average cost of capital (“WACC”), which represents the average rate a business must pay its providers of debt and equity. The cash flows employed in the DCF analysis were derived from internal earnings and forecasts and external market forecasts. If the estimated fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not impaired and the second step of the impairment test is not necessary. If the carrying amount of a reporting unit exceeds its estimated fair value, then the second step of the goodwill impairment test must be performed. The second step of our quantitative test for goodwill impairment compares the implied fair value of the reporting unit’s goodwill with its carrying amount of goodwill to measure the amount of impairment loss, if any. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination, whereby the estimated fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. During June 2016, as a result of recent industry consolidation activities and a review of strategic alternatives for the Company’s U.S. Wireline business in the Northeast, the Company identified factors indicating the carrying amount of certain assets may not be recoverable. More specifically, the factors included the competitive environment, recent industry consolidation, and the Company’s view of future opportunities in the market which began to evolve in the second quarter of 2016. O n August 4, 2016, the Company entered into a stock purchase agreement to sell the majority of its U.S. Wireline business. The transaction is subject to customary closing conditions. As a result of this transaction and the recent developments in the market, the Company determined it was appropriate to assess the reporting unit’s assets for impairment. The reporting unit holds three types of assets for purposes of impairment testing: i) other assets such as accounts receivable and inventory, ii) long lived assets such as property plant and equipment, and iii) goodwill. Management first assessed the other assets for impairment and determined no impairment was appropriate. Second, the property, plant and equipment was assessed for impairment. The impairment test compared the undiscounted cash flows from the use and eventual disposition of the asset group to its carrying amount and determined the carrying amount was not recoverable. The impairment loss of $3.6 million was equal to the amount by which the carrying amount exceeded the fair value. Third management assessed goodwill for impairment following the two step impairment test. The carrying amount of the reporting unit exceeded its fair value, after considering the $3.6 million asset impairment. The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of goodwill to measure the amount of impairment loss. The impairment loss equaled $7.5 million. The Company utilized the income approach, with Level 3 valuation inputs, which considered both the purchase agreement and cash flows discounted at a rate of 14% in its fair value calculations. In total, the Company recorded an impairment charge of $11.1 million. The impairment charge is included in income from operations for the year ended December 31, 2016. The Company performed its annual impairment assessments of its goodwill as of December 31, 2016 and determined that no impairment charges were required, as the fair value of each reporting unit exceeded its book value. Accordingly, there were additional changes in the carrying amounts of goodwill during that year. The table below disclosed goodwill recorded in each of the Company’s segments and accumulated impairment changes through during 2016. There were no changes to the Company’s goodwill balances from January 1, 2014 through December 31, 2015 (in thousands): U.S. International Renewable Telecom Telecom Energy Consolidated Balance at December 31, 2015 $ $ $ — $ Acquisitions Deconsolidation of Subsidiary — — Impairment — — Balance at December 31, 2016 Gross Accumulated Impairment — — Net $ $ $ $ Telecommunications Licenses The Company tests those telecommunications licenses that are indefinite lived for impairment on an annual basis, which has been determined to be as of December 31 of each fiscal year. The Company also tests telecommunication licenses that are indefinite lived between annual tests if an event occurs or circumstances change that indicate that the fair value of a reporting unit may be below its carrying value. The Company performed quantitative and qualitative assessments for its annual impairment assessment of substantially all of its indefinite lived telecommunications licenses as of December 31, 2016 and 2015 and determined that there were no indications of potential impairments. The changes in the carrying amount of the Company’s telecommunications licenses, by operating segment, for the three years ended December 31, 2016 were as follows (in thousands): U.S. Int'l Telecom Telecom Consolidated Balance at December 31, 2014 $ $ $ Amortization — Balance at December 31, 2015 $ $ $ Deconsolidation of subsidiary — Acquired licenses — Amortization — Balance at December 31, 2016 $ $ $ The licenses acquired during 2016 were acquired in the Innovative Transaction and are expected to be available for use into perpetuity. A subsidiary in the Company’s International Telecom segment was amortizing one of its telecommunications licenses until the date of its deconsolidation in December 2016. Customer Relationships The customer relationships, all of which are included in the International Telecom segment, are being amortized on an accelerated basis, over the expected period during which their economic benefits are to be realized. The Company recorded $2.0 million, $0.4 million, and $0.3 million of amortization related to customer relationships during year ended December 31, 2016, 2015, and 2014, respectfully. Future amortization of customer relationships, in our International Telecom segment, is as follows (in thousands): Future Amortization 2017 $ 2018 2019 2020 2021 Thereafter Total $ Other Intangible Assets The Company held other intangibles of $4.9 million consisting of $3.0 million of franchise rights and $1.9 million of tradenames in its International Telecom segment. These assets are recorded in other assets on the Company’s balance sheet. In 2016, we assessed the value of a tradename and concluded that its book value exceeded its fair value. As a result, we recorded a non-cash impairment charge of $0.3 million during the year ended December 31, 2016 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2016 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 8. LONG‑TERM DEBT On December 19, 2014, the Company amended and restated its then existing credit facility with CoBank, ACB and a syndicate of other lenders to provide for a $225 million revolving credit facility (the “Credit Facility”) that includes (i) up to $10 million under the Credit Facility for standby or trade letters of credit, (ii) up to $25 million under the 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 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 Facility ) plus 0.50% per annum; and (iii) the prime rate (as defined in the Credit Facility ). The applicable margin is determined based on the ratio (as further defined in the Credit Facility) of the Company’s indebtedness to EBITDA. Under the terms of the Credit Facility, the Company must also pay a fee ranging from 0.175% to 0.250% of the average daily unused portion of the Credit Facility over each calendar quarter. On January 11, 2016, the Company amended the Credit Facility (the “Amendment”) to provide for lender consent to, among other actions, (i) the contribution by the Company of all of its equity interests in ATN Bermuda Holdings, Ltd. to ATN Overseas Holdings, Ltd. in connection with the One Communications Transaction, a one-time, non-pro rata cash distribution by One Communications in an aggregate amount not to exceed $13.0 million to certain of One Communications’ shareholders; and (ii) the incurrence by certain subsidiaries of the Company of secured debt in an aggregate principal amount not to exceed $60.0 million in connection with the Company’s option to finance a portion of the Innovative Transaction. The Amendment increases the amount the Company is permitted to invest in “unrestricted” subsidiaries of the Company, which are not subject to the covenants of the Credit Facility , from $275.0 million to $400.0 million (as such increased amount shall be reduced from time to time by the aggregate amount of certain dividend payments to the Company’s stockholders). The Amendment also provides for the incurrence by the Company of incremental term loan facilities, when combined with increases to revolving loan commitments under the Credit Facility , in an aggregate amount not to exceed $200.0 million, which facilities shall be subject to certain conditions, including pro forma compliance with the total net leverage ratio financial covenant under the Credit Facility . The Credit Facility contains customary representations, warranties and covenants, including a financial covenant that imposes a maximum ratio of indebtedness to EBITDA 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 Credit Facility contains a financial covenant by us that imposes a maximum ratio of indebtedness to EBITDA. As of December 31, 2016, the Company was in compliance with all of the financial covenants of the Credit Facility. In addition, the Credit Facility restricts our Total Net Leverage (maximum ratio of indebtedness minus unrestricted cash to EBITDA). As of December 31, 2016, the Company had no borrowings under the Credit Facility and approximately $10.6 million of outstanding letters of credit. Ahana Debt On December 24, 2014, in connection with the Ahana Acquisition, the Company assumed $38.9 million in long-term debt (the “Original Ahana Debt”). The Original Ahana Debt included multiple loan agreements with banks that bore interest at rates between 4.5% and 6.0%, matured at various times between 2018 and 2023 and were secured by certain solar facilities. Repayment of the Original Ahana Debt was being made in cash on a monthly basis until maturity. The Original Ahana Debt also included a loan from Public Service Electric & Gas (the “PSE&G Loan”). The PSE&G Loan bears interest at 11.3%, matures in 2027, and is secured by certain solar facilities. Repayment of the Original 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 fixed at the time of the loan’s closing. Historically, the Company has made all repayments of the PSE&G Loan using SRECs. On December 19, 2016, Ahana’s wholly owned subsidiary, Ahana Operations, issued $20.6 million in aggregate principal amount of 4.427% senior notes due 2029 (the “Series A Notes”) and $45.2 million in aggregate principal amount of 5.327% senior notes due 2031 (the “Series B Notes”). Interest and principal are payable semi-annually beginning on March 31, 2017, until the respective maturity dates of March 31, 2029 (for the Series A Notes) and September 30, 2031 (for the Series B Notes). Cash flows generated by the solar projects that secure the Series A Notes and Series B Notes are only available for payment of such debt and are not available to pay other obligations or the claims of the creditors of Ahana or its subsidiaries. However, subject to certain restrictions, Ahana Operations holds the right to the excess cash flows not needed to pay the Series A Notes and Series B Notes and other obligations arising out of the securitizations. The Series A and Series B Notes are secured by certain assets of Ahana and are guaranteed by certain of its subsidiaries. A portion of the proceeds from the issuances of the Series A Notes and Series B Notes were used to repay the Original Ahana Debt in full except for the PSE &G Loan which remained outstanding after the refinancing. As of December 31, 2016, $2.5 million of the Original Ahana Debt and $65.8 million of the Series A Notes and Series B Notes remained outstanding. One Communications Debt In connection with the One Communications Transaction on May 3, 2016, the Company assumed $35.4 million in debt (the “One Communications Debt”) in the form of a loan from HSBC Bank Bermuda Limited. The One Communications Debt matures in 2021, bears interest of the three-month LIBOR plus a margin of 3.25%, and repayment is made quarterly until maturity. The debt is secured by the property and assets of certain One Communications subsidiaries. As of December 31, 2016, $32.1 million of the One Communications Debt remained outstanding. Innovative Debt The Company funded the Innovative Acquisition with $51.0 million in cash and financed the remaining $60.0 million of the purchase price with a loan from an affiliate of the seller, the Rural Telephone Finance Cooperative. The Company paid a fee of $0.9 million to lock the interest rate at 4% per annum over the term of the debt. The fee was recorded as a reduction to the debt carrying amount and will be amortized over the life of the loan. Interest is paid quarterly and principal repayment is not required until maturity on July 1, 2026. The debt is secured by certain assets of the Company’s Innovative subsidiary. As of December 31, 2016, $60.0 million of the Innovative Debt remained outstanding and $0.8 million of the rate lock fee were unamortized. |
GOVERNMENT GRANTS
GOVERNMENT GRANTS | 12 Months Ended |
Dec. 31, 2016 | |
GOVERNMENT GRANTS | |
GOVERNMENT GRANTS | 9. 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). Phase I 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 the Phase I Mobility Fund (“Phase I Mobility Fund”), a one-time award meant to support wireless coverage in underserved geographic areas in the United States. In August 2013 and October 2014, the Company received FCC final approvals for $21.7 million and $2.4 million, respectively, of Phase I 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 from the award date. 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. If the Company fails to comply with any of the terms and conditions upon which the Mobility Funds were granted, or if the Company 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 Mobility Funds projects and their results are included within the Company’s U.S. Telecom segment. As of December 31 2016, the Company had received approximately $ 19.7 million in Mobility Funds. Of these funds, $ 5.8 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. The remaining $13.9 million received offsets operating expenses, of which $4.6 million has been recorded to date, $ 3.4 million is recorded within long term liabilities, and the remaining $5.8 million is recorded within current liabilities in the Company’s consolidated balance sheet as of December 31, 2016. The balance sheet presentation is based on the timing of the expected usage of the funds which will reduce future operations expenses |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2016 | |
EQUITY | |
EQUITY | 10. EQUITY Common Stock The Company has paid quarterly dividends on its common stock since January 1999. Treasury Stock In September 2004, our Board of Directors approved a $5.0 million stock buyback plan (the “2004 Repurchase Plan”). Through September 19, 2016, we repurchased $4.1 million of our common stock, under the 2004 Repurchase Plan. On September 19, 2016, our Board of Directors authorized the repurchase of up to $50.0 million of our common stock, from time to time, on the open market or in privately negotiated transactions (the “2016 Repurchase Plan”). The 2016 Repurchase Plan replaces the 2004 Repurchase Plan. As of December 31, 2016, we have $49.9 million available to be repurchased under the 2016 Repurchase Plan. During the years ended December 31, 2016, 2015 and 2014, the Company repurchased the following shares under the 2004 Repurchase Plan and the 2016 Repurchase Plan: Aggregate Shares Cost Average Year ended December 31, Repurchased (in thousands) Repurchase Price 2016 $ $ 2015 — — — 2014 — — — During the years ended December 31, 2016, 2015 and 2014, the Company repurchased the following shares from employees to satisfy tax withholding and stock options exercise obligations incurred in connection with the vesting of restricted stock awards and the exercise of stock options: Aggregate Shares Cost Average Year ended December 31, Repurchased (in thousands) Repurchase Price 2016 $ $ 2015 2014 Stock‑Based Compensation The Company has 2,000,000 shares reserved for the grant of stock options, restricted stock, restricted stock units, stock equivalents and awards of shares of common stock that are not subject to restrictions or forfeiture. Stock Options Stock options have a term of ten years and vest annually and ratably over a period of four years. The following table summarizes stock option activity for the years ended December 31, 2016 and 2015: Year Ended December 31, 2016 Weighted Average Weighted Avg. Remaining Number of Exercise Contractual Aggregate Options Price Term (Years) Intrinsic Value Outstanding at January 1, 2016 $ Granted — — Exercised Outstanding at December 31, 2016 $ Vested and expected to vest at December 31, 2016 $ Exercisable at December 31, 2016 $ Year Ended December 31, 2015 Weighted Average Remaining Number of Weighted Avg. Contractual Aggregate Options Exercise Price Term (Years) Intrinsic Value Outstanding at January 1, 2015 $ Granted Exercised Outstanding at December 31, 2015 $ Vested and expected to vest at December 31, 2015 $ Exercisable at December 31, 2015 $ The unvested options as of December 31, 2016 represent $0.1 million in unamortized stock‑based compensation which will be recognized over a weighted average term of 2.6 years. The following table summarizes information relating to options granted and exercised during the years ended December 31, 2016, 2015 and 2014 (in thousands, except fair value of options granted data): 2016 2015 2014 Weighted-average fair value of options granted $ — $ $ N/A Aggregate intrinsic value of options exercised Cash proceeds received upon exercise of options Excess tax benefits from share-based compensation The aggregate intrinsic value represents the total pre‑tax intrinsic value (the difference between our closing common stock price on December 31st and the exercise price, multiplied by the number of the in‑the‑money stock options) that would have been received by the stock option holders had all stock options holders exercised their stock options on December 31st. The amount of aggregate intrinsic value will change based on the fair market value of our common stock. The Company did not grant any options during 2016 or 2014. The estimated fair value of the options granted during 2015 were determined using a Black Scholes option pricing model, based on the following weighted average assumptions: Risk-free interest rate % Expected dividend yield % Expected life years Expected volatility % The Company recognized $0.1 million, $0.9 million and $1.4 million, respectively, of stock compensation expense relating to the granted options during 2016, 2015, and 2014, respectively. Restricted Stock Restricted stock issued under the 2008 Equity Investment Plan vest ratably over four years. The following table summarizes restricted stock activity during the year ended December 31, 2016: Weighted Avg. Shares Fair Value Unvested as of January 1, 2016 $ Granted Forfeited Vested and issued Unvested as of December 31, 2016 $ The following table summarizes restricted stock activity during the year ended December 31, 2015: Weighted Avg. Shares Fair Value Unvested as of January 1, 2015 $ Granted Forfeited Vested and issued Unvested as of December 31, 2015 $ In connection with the grant of restricted shares, the Company recognized $6.2 million, $4.3 million and $3.4 million of compensation expense within its income statements for the years ended December 31, 2016, 2015, and 2014, respectively. In addition, the Company recognized $0.1 million of compensation expense within its income statement for the year ended December 31, 2016 for shares of the Company’s subsidiaries granted to the management team of those subsidiaries. The unvested shares as of December 31, 2016 represent $11.2 million in unamortized stock based compensation which will be recognized over a weighted average period of 2.5 years . |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2016 | |
INCOME TAXES | |
INCOME TAXES | 11. INCOME TAXES The components of income before income taxes for the years ended December 31, 2016, 2015 and 2014 are as follows (in thousands): 2016 2015 2014 Domestic $ $ $ Foreign Total $ $ $ The following is a reconciliation from the tax computed at statutory income tax rates to the Company’s income tax expense for the years ended December 31, 2016, 2015, and 2014 (in thousands): 2016 2015 2014 Tax computed at statutory U.S. federal income tax rates $ $ $ Non controlling interest Foreign tax rate differential Over (under) provided in prior periods Nondeductible expenses Goodwill Impairment — — Capitalized transactions costs — — Change in tax reserves State Taxes, net of federal benefit Change in valuation allowance Foreign tax credit expiration Other, net Total Income Tax Expense $ $ $ The components of income tax expense (benefit) for the years ended December 31, 2016, 2015 and 2014 are as follows (in thousands): \ 2016 2015 2014 Current: United States—Federal $ $ $ United States—State Foreign Total current income tax expense $ $ $ Deferred: United States—Federal $ $ $ United States—State Foreign Total deferred income tax expense (benefit) Consolidated: United States—Federal $ $ $ United States—State Foreign Total income tax expense $ $ $ The significant components of deferred tax assets and liabilities are as follows as of December 31, 2016 and 2015 (in thousands): 2016 2015 Deferred tax assets: Receivables reserve $ $ Temporary differences not currently deductible for tax Deferred compensation Foreign tax credit carryforwards — Pension Net operating losses Total deferred tax asset Deferred tax liabilities: Property, plant and equipment, net $ $ Intangible assets, net Total deferred tax liabilities Valuation allowance Net deferred tax liabilities $ $ Deferred tax assets and liabilities are reflected in the accompanying consolidated balance sheets as follows (in thousands): 2016 2015 Deferred tax assets: Current $ — $ — Long term — Total deferred tax asset $ $ — Deferred tax liabilities: Current $ — $ — Long term Total deferred tax liabilities $ $ Net deferred tax liabilities $ $ As of December 31, 2016, additional components within the reconciliation of the tax expense from statutory income rates became significant to the financial statements; therefore the presentation of the 2015 and 2014 balances have been adjusted accordingly for comparative purposes. As of December 31, 2016, the Company estimated that it had gross federal, state and foreign net operating loss (“NOL”) carryforwards of $3.3 million, $8.9 million and $74.7 million respectively. Of these, $83.5 million will expire between 2017 and 2036 and $3.4 million may be carried forward indefinitely. The Company assesses available positive and negative evidence to estimate if sufficient future taxable income will be generated to realize the existing deferred tax assets. A significant piece of negative evidence evaluated is cumulative losses incurred in certain reporting jurisdictions over the three-year period ended December 31, 2016. Other negative evidence examined includes, but is not limited to, losses expected in early future years, a history of tax benefits expiring unused, uncertainties whose unfavorable resolution would adversely affect future results, and brief carryback, carry forward periods. On the basis of this evaluation, the Company believed it was more likely than not that the benefit from some of these state and foreign deferred taxes would not be realized. In recognition of this risk at December 31, 2015, the Company provided a valuation allowance of $2.0 million and $1.7 million for its state and foreign NOL carryforwards, respectively. Some of the foreign entities acquired in 2016 maintained a full valuation allowance on their NOLs and other deferred tax assets. Where the business combination did not provide any positive evidence for which the Company could recognize these assets, a $41.9 million valuation allowance was established as part of purchase accounting. At December 31, 2016, our state and foreign NOL carryforward valuation allowance was $0.5 million and $27.8 million for state and foreign NOL carryforwards, respectively. The remaining valuation allowance of $14.1 million has been applied to the other foreign deferred taxes for entities with a full valuation allowance at December 31, 2016. As of December 31, 2015, the Company had $4.1 million of foreign tax credits, with a corresponding valuation allowance, which fully expired during the year ended December 31, 2016 and the valuation allowance was released. The Company has approximately $288.6 million of undistributed earnings of its foreign subsidiaries that as of December 31, 2016 are considered to be indefinitely reinvested and accordingly, no U.S. federal or state income taxes have been provided thereon. Determination of the amount of unrecognized deferred U.S. income tax liability is not practicable because of the complexities associated with its hypothetical calculation as such liability, if any, is dependent on circumstances existing if and when such remittance occurs. The Company had net unrecognized tax benefits (including interest and penalty) of $20.0 million as of December 31, 2016, $18.9 million as of December 31, 2015 and, $16.5 million as of December 31, 2014. The net increase of the reserve during the year ended December 31, 2016 was attributable to an increase in tax positions for prior periods of $1.4 million, an increase in tax positions for the current period of $2.3 million, partially offset by a settlement of a prior year position of $0.8 million, and lapse in statutes of limitation of $1.8 million. The following shows the activity related to unrecognized tax benefits (not including interest and penalty) during the three years ended December 31, 2016 (in thousands): Gross unrecognized tax benefits at December 31, 2013 Increase in unrecognized tax benefits taken during a prior period Increase in unrecognized tax benefits taken during the current period Lapse in statute of limitations Settlements — Gross unrecognized tax benefits at December 31, 2014 Increase in unrecognized tax benefits taken during a prior period — Increase in unrecognized tax benefits taken during the current period Lapse in statute of limitations — Settlements — Gross unrecognized uncertain tax benefits at December 31, 2015 Increase in unrecognized tax benefits taken during a prior period Increase in unrecognized tax benefits taken during the current period Lapse in statute of limitations Settlements Gross unrecognized uncertain tax benefits at December 31, 2016 $ The Company’s accounting policy is to classify interest and penalties related to income tax matters as part of income tax expense. The accrued amounts for interest and penalties are $2.1 million as of December 31, 2016, and $1.7 million as of December 31, 2015, and $1.0 million as of December 31, 2014. All $20.0 million of unrecognized tax benefits (including interest and penalty) would affect the effective tax rate if recognized. The Company and its subsidiaries file income tax returns in the U.S. and in various, state and local and foreign jurisdictions. The statute of limitations related to the consolidated U.S. federal income tax return is closed for all tax years up to and including 2012. The expiration of the statute of limitations related to the various state and foreign income tax returns that the Company and subsidiaries file varies by jurisdiction. |
RETIREMENT PLANS
RETIREMENT PLANS | 12 Months Ended |
Dec. 31, 2016 | |
RETIREMENT PLANS | |
RETIREMENT PLANS | 12. RETIREMENT PLANS The Company has a noncontributory defined benefit pension plan for eligible employees of its GTT and Innovative subsidiaries who meet certain age and employment criteria. The Company also has a noncontributory defined medical, dental, vision, and life benefit plan for eligible employees of its Innovative subsidiary who meet certain age and employment criteria. The Company acquired the Innovative plans as a result of the July 2016 Innovative Acquisition. Company contributions to fund the pension plans are intended to provide not only for benefits attributed for service to date but also for those expected to be earned in the future. The Company’s funding policy is to contribute to the plan such amounts as are actuarially determined to meet funding requirements. The benefits are based on the participants’ average salary or hourly wages during the last three years of employment and credited service years. The Company funds the other postretirement benefit plans as benefits are paid. The weighted‑average rates assumed in the actuarial calculations for the pension and other postretirement benefit plans are as follows as of December 31, 2016, 2015 and 2014: 2016 2015 2014 Discount Rate – Pension Benefit % % % Discount Rate – Postretirement Benefit % N/A N/A Annual salary increase % % % Expected long-term return on plan assets % % % The expected long‑term rate of return on plan assets was determined based on several factors including input from pension investment consultants, projected long‑term returns of equity and bond indices, and historical returns over the life of the related obligations of the fund. The Company, in conjunction with its pension investment consultants, reviews its asset allocation periodically and rebalances its investments when appropriate in an effort to earn the expected long‑term returns. The Company will continue to evaluate its long‑term rate of return assumptions at least annually and will adjust them as necessary. The annual salary increase assumption reflects the Company’s estimated long average rate of salary increases. The assumption is not applicable to the Innovative pension and other postretirement plans as the obligations associated with these plans are not dependent on participant’s salaries. The discount rate was determined based on a review of market data including yields on high quality corporate bonds with maturities approximating the remaining life of the project benefit obligations. The other postretirement benefit plans healthcare cost trend assumptions is based on health care trend rates. The 2017 assumed medical health care cost trend rate is 5.8% trending to an ultimate rate of 4.5% in 2075. The 2017 assumed dental care cost trend rate is 4.0% trending to an ultimate rate of 2.0% in 2030. The effect of a one-percentage-point increase in the assumed health care cost trend rates for each future year on the accumulated postretirement benefit obligation for health care benefits and the aggregate of the service and interest cost components of net periodic postretirement health care benefit cost is shown below: Accumulated postretirement benefit obligation Service cost plus interest cost At trend At trend + 1% Dollar Impact Percentage Impact % % At trend – 1% Dollar Impact Percentage Impact % % Changes during the year in the projected benefit obligations and in the fair value of plan assets are as follows for 2016 and 2015 (in thousands): 2016 2015 Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Projected benefit obligations: Balance at beginning of year: $ $ — $ $ — Innovative Acquisition — — Service cost — Interest cost — Curtailment — — — Benefits and settlements paid — Actuarial (gain) loss — Experience loss — — Balance at end of year $ $ $ $ — Plan net assets: Balance at beginning of year: $ $ — $ $ — Innovative Acquisition — — — Actual return on plan assets — — Company contributions — — Benefits and settlements paid — Balance at end of year $ $ — $ $ — Under funded status of plan $ $ $ $ — The Company reports an asset or liability on its balance equal to the funded status of its pension and other postretirement benefit plans. Plans in an overfunded status are aggregated and recorded as a net benefit asset in other assets. Plans in an underfunded status are aggregated and recorded as a net benefit liability in other liabilities. The funded status of the Company’s pension and other retirement benefit plans is below (in thousands): 2016 2015 GTT Pension Benefit Innovative Pension Benefit Postretirement Benefits GTT Pension Benefit Innovative Pension Benefit Postretirement Benefits Projected benefit obligation $ $ $ $ $ — $ — Plan Net Assets — — — Over/ (Under) funded status of plan $ $ $ $ $ — $ — At December 31, 2016, the Company held $5.1 million of restricted cash equal to the underfunded status of the other postretirement benefit plans. The cash is restricted due to the Company’s intent and specific nature of the commitment. The Company’s investment policy for its pension assets is to have a reasonably balanced investment approach, with a long‑term bias toward debt investments. The Company’s strategy allocates plan assets among equity, debt and other assets to achieve long‑term returns without significant risk to principal. The GTT pension fund has limitations from investing in the equity, debt or other securities of the employer, its subsidiaries or associates of the employer or any company of which the employer is a subsidiary or an associate. Furthermore, the GTT plan must invest between 70% - 80% of its total plan assets within Guyana. The fair values for the pension plan’s net assets, by asset category, at December 31, 2016 are as follows (in thousands): Asset Category Total Level 1 Level 2 Level 3 Cash, cash equivalents, money markets and other $ $ $ — $ — Common stock - domestic — — Common stock - foreign — Mutual funds - equities — Exchange traded funds - equities — — Fixed income mutual funds — — Fixed income securities — — Annuities — — Total $ $ $ $ The plan’s weighted‑average asset allocations at December 31, 2016 and 2015, by asset category are as follows: 2016 2015 Cash, cash equivalents, money markets and other % % Common stock - domestic Common stock - foreign — Mutual funds - equities — Exchange traded funds - equities — Fixed income mutual funds — Fixed income securities Annuities — Total % % Amounts recognized on the Company’s consolidated balance sheets consist of (in thousands): As of December 31, 2016 2015 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Accrued and current liabilities $ — $ $ — $ — Other Liabilities — Other Assets — — — Accumulated other comprehensive income / (loss), net of tax — Amounts recognized in accumulated other comprehensive loss consist of (in thousands): As of December 31, 2016 2015 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Net actuarial gain / (loss) $ $ $ $ — Accumulated other comprehensive income / ( loss), pre-tax — Accumulated other comprehensive income / ( loss), net of tax — Components of the plan’s net periodic pension cost are as follows for the years ended December 31, 2016, 2015 and 2014 (in thousands): 2016 2015 2014 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Pension benefits Postretirement benefits Service cost $ $ $ $ — $ $ — Interest cost — — Expected return on plan assets — — — Amortization of unrecognized net actuarial loss — — — Curtailment — — — — — Net periodic pension cost $ $ $ $ — $ $ — For the year ended December 31, 2017, the Company expects to contribute approximately $833 its pension plans. The following estimated pension benefits, which reflect expected future service, as appropriate, are expected to be paid over the next ten years as indicated below (in thousands): Pension Fiscal Year Benefits 2017 $ 2018 2019 2020 2021 2022 - 2026 $ |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 13. 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 of December 31, 2016 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. The letters of credit accrue a fee at a rate of 1.75% per annum on the outstanding amounts. If the Company fails to comply with certain terms and conditions upon which the Mobility Funds are to be granted, or if it loses eligibility for Mobility Fund support, USAC will be entitled to draw the entire amount of the letter of credit applicable to the affected project including penalties. The Company is in compliance with all applicable terms and conditions. The results of the Company’s Mobility Fund projects are included in the Company’s “U.S. Telecom” segment. Currently, the Company’s Guyana subsidiary, GTT, 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. In connection therewith, the Company and GTT have met on several occasions with officials of the Government of Guyana to discuss potential modifications of GTT’s exclusivity and other rights under the existing agreement and license. On July 18, 2016, the Guyana Parliament passed telecommunications legislation, and on August 5, 2016, the legislation was signed into law, that introduces material changes to many features of Guyana’s existing telecommunications regulatory regime with the intention of creating a more competitive market. In contrast to prior legislative proposals, the legislation that passed does not include a provision that permits other telecommunications carriers to receive licenses automatically upon signing of the legislation, nor does it have the effect of terminating the Company’s exclusive license. Instead the legislation as passed requires the Minister of Telecommunications to conduct further proceedings and issue implementing orders to enact the various provisions of the legislation. The Company cannot predict the manner in which it will be implemented by the Minister of Telecommunications. In December 2016 the Government of Guyana and the Company met to discuss modifications of the Company’s exclusivity rights and other rights under its existing agreement and license. Those discussions are on-going. However, there can be no assurance that those discussions will be concluded before the Government issues new licenses contemplated by the legislation or at all, or that they will satisfactorily address contractual exclusivity rights. 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, GTT 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 GTT agreed to with the Government. GTT 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. In 2011, GTT paid the NFMU $2.6 million representing payments in full for 2008, 2009 and 2010. However, by letter dated November 23, 2011, the NFMU stated that it did not concur with GTT’s inference that the amount was payment in full for the specified years as it was their continued opinion that the final calculation for GSM spectrum fees was not agreed upon and was still an outstanding issue. By further letter dated November 24, 2011, the NFMU further rejected a proposal that was previously submitted jointly by GTT and Digicel’s which outlined a recommended methodology for the calculation of these fees. The NFMU stated that it would prepare its own recommendation which it would send to the Minister of Telecommunications for decision of the matter. GTT has paid undisputed spectrum fees according to the methodology used for its 2011 payments, and has reserved amounts payable according to this methodology. There have been limited further discussions on this subject and GTT 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 GTT and ATN claiming breach of an interconnection agreement for domestic cellular services in Guyana and related claims. CTL asserted over $200 million in damages. GTT 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 GTT and the Public Utility Commission in the High Court of Guyana. The matter remained idle from the April 2013 filing until December 2015 when CTL filed a “Statement of Claim” reiterating the claims previously made in its prior filings. On April 7, 2016 the High Court of Guyana struck and dismissed CTL’s action as abandoned pursuant to the Court’s rules of civil procedure and the claim is no longer pending. On May 8, 2009, Digicel filed a lawsuit in Guyana challenging the legality of GTT’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, GTT petitioned to intervene in the suit in order to oppose Digicel’s claims and that petition was granted on May 18, 2009. GTT filed an answer to the charge on June 22, 2009 and the case is pending. The Company believes that any legal challenge to GTT’s exclusive license rights granted in 1990 is without merit and the Company intends to vigorously defend against such a legal challenge. GTT has filed several lawsuits in the High Court of Guyana asserting that, despite its denials, Digicel is engaged in international bypass in violation of GTT’s exclusive license rights, the interconnection agreement between the parties, and the laws of Guyana. GTT 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 GTT has violated the terms of the interconnection agreement and Guyana laws. These suits, filed in 2010 and 2012, have yet to proceed to trial and it remains uncertain as to when a trial date may be set. GTT intends to vigorously prosecute these matters. GTT 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 GTT be held liable for any of the disputed tax assessments, totaling $44.1 million, the Company believes that the Government of Guyana would then be obligated to reimburse GTT for any amounts necessary to ensure that GTT’s return on investment was no less than 15% per annum for the relevant periods. The Company believes that some adverse outcome is probable and has accordingly accrued $5.0 million as of December 31, 2016 for these matters. Lease Commitments and Other Obligations The Company leases approximately 2.7 million square feet for its operations centers, administrative offices and retail stores as well as certain tower sites under non‑cancelable operating leases. The Company’s obligations for payments under these leases are as follows at December 31, 2016 (in thousands): 2017 2018 2019 2020 2021 Thereafter Total obligations under operating leases $ Rent expense for the years ended December 31, 2016, 2015 and 2014 was $19.8 million, $17.0 million and $15.0 million, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2016 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 14. RELATED‑PARTY TRANSACTIONS In October 2014, the Company’s U.S. Virgin Islands business, Choice Communications, LLC (“Choice”), entered into a tower lease with Tropical Tower Ltd (“Tropical Tower”), an entity 90% owned by Cornelius B. Prior, Jr., the Chairman of the Company’s Board of Directors. When aggregated with amounts that Choice currently pays to Tropical Tower for an existing tower lease entered into in April 2012, Choice will pay approximately $117,000 per year in rental payments to Tropical Tower. Each tower lease has an initial term of five years, with two additional five year renewal periods and has provisions for an increase in rent by 5% each year. Our Audit Committee reviewed the specific structure and terms of the October 2014 lease, as negotiated by Choice management, and unanimously approved the arrangement described above in accordance with the terms of our Related Person Transaction Policy. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2016 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | 15. SEGMENT REPORTING For the year ended December 31, 2015, the Company had five reportable segments for separate disclosure in accordance with the FASB’s authoritative guidance on disclosures about segments of an enterprise. Those five segments were: i) U.S. Wireless, which generated all of its revenues in and had all of its assets located in the United States, ii) International Integrated Telephony, which generated all of its revenues in and had all of its assets located in Guyana, iii) Island Wireless, which generated a majority of its revenues in, and had a majority of its assets located in, Bermuda and which also generated revenues in and had assets located in the U.S. Virgin Islands, Aruba and Turks and Caicos (through March 23, 2015), iv) U.S. Wireline, which generated all of its revenues in and had all of its assets located in the United States, and v) Renewable Energy, which generated all of its revenues in and had all of its assets located in the United States. The operating segments were managed separately because each offers different services and serves different markets. To be consistent with how management allocates resources and assesses the performance of its business operations in 2016, the Company updated its reportable and operating segments in the first quarter of the year to consist of the following: i) U.S. Telecom, consisting of the Company’s former U.S. Wireless and U.S. Wireline segments, ii) International Telecom, consisting of the Company’s former Island Wireless and International Integrated Telephony segments and the results of its One Communications and Innovative Acquisitions as discussed below, and iii) Renewable Energy, consisting of the Company’s former Renewable Energy segment and the results of its Vibrant Energy Acquisition. The prior year segment information has been recast to conform to the current year’s segment presentation. The following tables provide information for each operating segment (in thousands): For the Year Ended December 31, 2016 U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated Revenue Wireless $ $ $ — $ — $ Wireline — — Equipment and Other — Renewable Energy — — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — Operating income (loss) For the Year Ended December 31, 2015 U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated Revenue Wireless $ $ $ — $ — $ Wireline — — Equipment and Other — — Renewable Energy — — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — Operating income (loss) For the Year Ended December 31, 2014 U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated Revenue Wireless $ $ $ — $ — $ Wireline — — Equipment and Other — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — — Operating income (loss) U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated December 31, 2016 Net fixed assets $ $ $ $ $ Goodwill — Total assets December 31, 2015 Net fixed assets $ $ $ $ $ Goodwill — — Total assets Capital Expenditures U.S. International Renewable Reconciling Year ended December 31, Telecom Telecom Energy Items (1) Consolidated 2016 $ $ $ $ $ 2015 (1) Reconciling items refer to corporate overhead expenses and consolidating adjustments. The table below identifies the Company’s revenues and long-lived assets by geographic location. The Company attributes revenue to geographic location based on location of the customer (in thousands): 2016 2015 2014 Long-Lived Long-Lived Long-Lived Revenues Assets Revenues Assets Revenues Assets U.S. $ $ $ $ $ $ Guyana U.S Virgin Islands Bermuda Other Foreign Countries $ $ $ $ $ $ |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2016 | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | 16. QUARTERLY FINANCIAL DATA (UNAUDITED) Following is a summary of the Company’s quarterly results of operations for the years ended December 31, 2016 and 2015 (in thousands): 2016 Consolidated for the Three Months Ended March 31 June 30 September 30 December 31 Total revenue $ $ $ $ Operating expenses Income from operations Other income (expense), net Income (Loss)from continuing operations before income taxes Income taxes Income (Loss) from continuing operations Income from discontinued operations: Income from discontinued operations, net of tax — — — — Net income Net income attributable to non-controlling interests, net of tax: Continuing operations Net income attributable to ATN International, Inc. stockholders Net income per weighted average basic share attributable to ATN International, Inc. stockholders Continuing operations Total Net income per weighted average diluted share attributable to ATN International, Inc. stockholders Continuing operations Total 2015 Consolidated for the Three Months Ended March 31 June 30 September 30 December 31 Total revenue $ $ $ $ Operating expenses Income from operations Other income (expense), net Income from continuing operations before income taxes Income taxes Income from continuing operations Income from discontinued operations: Gain on sale of discontinued operations, net of tax — — Income from discontinued operations, net of tax — — Net income Net income attributable to non-controlling interests, net of tax: Continuing operations Discontinued operations — — — — Disposal of discontinued operations — — — — Net income attributable to ATN International, Inc. stockholders Net income per weighted average basic share attributable to ATN International, Inc. stockholders Continuing operations Discontinued operations: Discontinued operations — — — Gain on sale of discontinued operations — — — — Total discontinued operations — — — Total Net income per weighted average diluted share attributable to ATN International, Inc. stockholders Continuing operations Discontinued operations: Discontinued operations — — — Gain on Sale of discontinued operations — — — — Total discontinued operations — — — Total During the three months ended December 31, 2015, the Company recognized an approximate $0.7 million benefit to correct for tax basis differences and expense recognition related to prior periods. Of these errors, $0.7 million primarily related to the three months ended September 30, 2015. During the three months ended December 31, 2016, the Company recognized an approximate $0.8 million charge to correct for a $0.3 million understatement of expense related primarily to the nine months ended September 30, 2016 in our International Telecom segment and a $0.5 million reduction to revenue primarily related to the nine months ended September 30, 2016 in our Renewable Energy segment. The Company determined that the impact of the correction of these errors was not material to the current or any prior period financial statements. |
SCHEDULE II VALUATION AND QUALI
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2016 | |
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE I ATN INTERNATIONAL, INC. AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS (Amounts in Thousands) Balance at Purchase Charged to Balance Beginning Price Costs and at End of Year Accounting Expenses Deductions of Year YEAR ENDED, December 31, 2014 Description: Valuation allowance on foreign tax credit carryforwards $ $ — $ — $ $ Valuation allowance on foreign net operating losses — — Valuation allowance on state net operating losses — — Allowance for doubtful accounts — $ $ — $ $ $ YEAR ENDED, December 31, 2015 Description: Valuation allowance on foreign tax credit carryforwards $ $ — $ — $ $ Valuation allowance on foreign net operating losses — — Valuation allowance on state net operating losses — — Allowance for doubtful accounts — $ $ — $ $ $ YEAR ENDED, December 31, 2016 Description: Valuation allowance on foreign tax credit carryforwards $ $ — $ $ $ — Valuation allowance on foreign net operating losses Valuation allowance on state net operating losses — — Allowance for doubtful accounts — $ $ $ $ $ |
SUMMARY OF SIGNIFICANT ACCOUN29
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation 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 December 31, 2015 financial statements to conform to the Company’s consolidated income statements to how it analyzes its operations in the current period. These changes did not impact operating income. For the year ended December 31, 2015 the aggregate impact of the changes included an increase to termination and access fees of $4.1 million, a decrease to engineering and operations expenses of $2.3 million, a decrease to sales and marketing expenses of $2.4 million and an increase to general and administrative expenses of $0.5 million. |
Use of Estimates | 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 business combinations, fair value of indefinite-lived intangible assets, goodwill and income taxes. Actual results could differ significantly from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all investments with an original maturity of three months or less at date of purchase to be cash equivalents. The Company places its cash and temporary investments with banks and other institutions that it believes have a high credit quality. At December 31, 2016, the Company had deposits with banks in excess of FDIC insured limits and $24.3 million of its cash is on deposit with non‑insured institutions such as corporate money market issuers and cash held in foreign banks. The Company’s cash and cash equivalents are not subject to any restrictions (see Note 8). As of December 31, 2016 and 2015, the Company held $7.5 million and $3.8 million, respectively, of its cash in Guyana dollars. While there are risks associated with the conversion of Guyana dollars to U.S. dollars due to limited liquidity in the Guyana foreign currency markets, to date it has not prevented the Company from converting Guyana dollars into U.S. dollars within a given three month period or from converting at a price that reasonably approximates the reported exchange rate. |
Short Term Investments | Short Term Investments The Company's short-term investments consist of corporate bonds, which have remaining maturities of more than three months at the date of purchase, and equity securities classified as available for sale, which are stated at fair value. Unrealized gains and losses, net of related income taxes, for available for sale securities are reported as net increases and decreases to accumulated other comprehensive income (loss) until realized. The estimated fair values of investments are based on quoted market prices as of the end of the reporting period. The corporate bonds as of December 31, 2016 have contractual maturities of less than one year. |
Restricted Cash | Restricted Cash The majority of the Company’s restricted cash balance is held in the Company’s Ahana Renewables subsidiary as described in Note 3. The restricted cash is held in escrow and serves as collateral for Ahana Renewables’ debt in order to meet future debt service obligations and other operating obligations of the solar facilities. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company maintains an allowance for doubtful accounts for the estimated probable losses on uncollectible accounts receivable. The allowance is based upon a number of factors including the credit worthiness of customers, the Company’s historical experience with customers, the age of the receivable and current market and economic conditions. Such factors are reviewed and updated by the Company on a quarterly basis. Uncollectible amounts are charged against the allowance account. |
Materials and Supplies | Materials and Supplies Materials and supplies primarily include handsets, customer premise equipment, cables and poles and are recorded at the lower of cost or market cost being determined on the basis of specific identification and market determined using replacement cost. |
Fixed Assets | Fixed Assets The Company’s fixed assets are recorded at cost and depreciated using the straight‑line method generally between 3 and 39 years. Expenditures for major renewals and betterments that extend the useful lives of fixed assets are capitalized. Repairs and replacements of minor items of property are charged to maintenance expense as incurred. The cost of fixed assets in service and under construction includes an allocation of indirect costs applicable to construction. Grants received for the construction of assets are recognized as a reduction of the cost of fixed assets, a reduction of depreciation expense over the useful lives of the assets and as a reduction of capital expenditures in the statements of cash flows. The fair value of a liability for an asset retirement obligation is recorded in the period in which it is incurred if a reasonable estimate of fair value can be made. In periods subsequent to initial measurement, period‑to‑period changes in the liability for an asset retirement obligation resulting from the passage of time and revisions to either the timing or the amount of the original estimate of undiscounted cash flows are recognized. The increase in the carrying value of the associated long‑lived asset is depreciated over the corresponding estimated economic life. The consolidated balance sheets include accruals of $3.2 million and $3.0 million as of December 31, 2016 and 2015, respectively, for estimated costs associated with asset retirement obligations. In accordance with the authoritative guidance for the accounting for the impairment or disposal of long‑lived assets, the Company evaluates the carrying value of long‑lived assets, including property and equipment, in relation to the operating performance and future undiscounted cash flows of the underlying business whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss exists when estimated undiscounted cash flows attributable to an asset are less than its carrying amount. If an asset is deemed to be impaired, the amount of the impairment loss recognized represents the excess of the asset’s carrying value as compared to its estimated fair value, based on management’s assumptions and projections. Management’s estimate of the future cash flows attributable to its long‑lived assets and the fair value of its businesses involve significant uncertainty. Those estimates are based on management’s assumptions of future results, growth trends and industry conditions. If those estimates are not met, the Company could have additional impairment charges in the future, and the amounts may be material. See Note 3, Pending Disposition- U.S. Telecom, regarding the Company’s impairment of certain fixed assets. |
Goodwill and Indefinite-Lived Intangible Assets | Goodwill and Indefinite‑Lived Intangible Assets Goodwill is the amount by which the cost of acquired net assets exceeded the fair value of those net assets on the date of acquisition. The Company allocates goodwill to reporting units at the time of acquisition and bases that allocation on which reporting units will benefit from the acquired assets and liabilities. Reporting units are defined as operating segments or one level below an operating segment, referred to as a component. The Company has determined that its reporting units are components of its multiple operating segments. The Company assesses goodwill for impairment on an annual basis in the fourth quarter or more frequently when events and circumstances occur indicating that the recorded goodwill may be impaired. If the book value of a reporting unit exceeds its fair value, the implied fair value of goodwill is compared with the carrying amount of goodwill. If the carrying amount of goodwill exceeds the implied fair value, an impairment loss is recorded equal to that excess. A significant majority of the Company’s telecommunications licenses are not amortized and are carried at their historical costs. The Company believes that telecommunications licenses generally have an indefinite life based on the historical ability to renew such licenses, that such renewals may be obtained indefinitely and at little cost, and that the related technology used is not expected to be replaced in the foreseeable future. The Company has elected to perform its annual testing of its telecommunications licenses in the fourth quarter of each fiscal year, or more often if events or circumstances indicate that there may be impairment. If the value of these assets were impaired by some factor, such as an adverse change in the subsidiary’s operating market, the Company may be required to record an impairment charge. The impairment test consists of a comparison of the fair value of telecommunications licenses with their carrying amount on a license by license basis and as a part of the test the Company assesses the appropriateness of the application of the indefinite‑lived assertion. As of December 31, 2016 and 2015, the Company performed its annual impairment assessment of its goodwill and indefinite‑lived intangible assets (telecommunications licenses) and determined that no impairment charge was required. See Note 7 for a discussion of the Company’s quantitative and qualitative tests of its goodwill. See Note 3, Pending Disposition- U.S. Telecom, regarding the Company’s impairment of certain fixed assets and goodwill. |
Other Intangible Assets | Other Intangible Assets Intangible assets resulting from the acquisitions of entities accounted for using the purchase method of accounting are estimated by management based on the fair value of assets acquired. These include acquired customer relationships, tradenames, and franchise rights. Customer relationships are amortized over their estimated lives ranging from 7-13 years, which are based on the pattern in which economic benefit of the customer relationship is estimated to be realized. |
Debt | Debt Debt is measured at amortized cost. Debt issuance costs on term loans and specified maturity borrowings are recorded as a reduction to the carrying value of the debt and are amortized as interest expense in the consolidated income statements over the period of the debt. Fees related to revolving credit facilities and lines of credit are recorded in other assets in the consolidated balance sheet and are amortized as interest expense in the consolidated income statements over the life of the facility. Except for interest costs incurred for the construction of a qualifying asset which are capitalized during the period the assets are prepared for their intended use, interest costs are expensed. |
Non-Controlling Interests | Non‑Controlling Interests The non‑controlling interests in the accompanying consolidated balance sheets reflect the original investments by the minority stockholders in GTT, Commnet’s consolidated subsidiaries, One Communications, Innovative, Sovernet and its consolidated subsidiaries and Ahana Renewables, along with their proportional share of the earnings or losses, net of any distributions. |
Changes in Accumulated Other Comprehensive Income (Loss) | Changes in Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss), by component, were as follows (in thousands): Projected Pension Benefit Translation Short Term Obligation Adjustment Investment Total Balance at December 31, 2013 $ — Adjust funded status of pension plan, net of tax of $0.6 million — — Foreign currency translation adjustment — — Balance at December 31, 2014 — Adjust funded status of pension plan, net of tax of $0.7 million — — Foreign currency translation adjustment — — Balance at December 31, 2015 — Adjust funded status of pension plan, net of tax of $0.7 million — — Foreign currency translation adjustment — — Unrealized gain on marketable securities — — Balance at December 31, 2016 $ $ $ $ Amounts totaling $1.3 million, $0.2 million, and $0.2 million were reclassified from other comprehensive income to general and administrative operating expense related to the Company’s defined pension plans for the years ending December 31, 2016, 2015, and 2014, respectively . |
Revenue Recognition | Revenue Recognition- Telecommunications Service revenues are primarily derived from providing access to and usage of the Company’s networks and facilities. Access revenues from postpaid customers are generally billed one month in advance and are recognized over the period that the corresponding service is rendered to customers. Revenues derived from usage of the Company’s networks, including airtime, roaming, long‑distance and Universal Service Fund revenues, are recognized when the services are provided and are included in unbilled revenues until billed to the customer. Prepaid airtime sold to customers is recorded as deferred revenue prior to the commencement of services and is recognized when the airtime is used or expires. The Company offers enhanced services including caller identification, call waiting, call forwarding, three‑way calling, voice mail, and text and picture messaging, as well as downloadable wireless data applications, including ringtones, music, games, and other informational content. Generally, these enhanced features generate additional service revenues through monthly subscription fees or increased usage through utilization of the features. Other optional services such as equipment protection plans may also be provided for a monthly fee and are either sold separately or bundled and included in packaged rate plans. Revenues from enhanced features and optional services are recognized when earned. Access and usage‑based services are billed throughout the month based on the bill cycle assigned to a particular customer. As a result of billing cycle cut‑off times, management must estimate service revenues earned but not yet billed at the end of each reporting period. Sales of communications products including wireless handsets and accessories represent a separate earnings process and are recognized when the products are delivered to and accepted by customers. The Company accounts for transactions involving both the activation of service and the sale of equipment in accordance with the authoritative guidance for the accounting for revenue arrangements with multiple deliverables. Fees assessed to communications customers to activate service are not a separate unit of accounting and are allocated to the delivered item (equipment) and recognized as product sales to the extent that the aggregate proceeds received from the customer for the equipment and activation fee do not exceed the relative fair value of the equipment. Commissions paid to third parties are expensed as incurred and included in sales and marketing expenses. Wholesale revenues are those revenues generated from providing voice or data services to the customers of other wireless carriers principally through “roaming” agreements, and the revenue is recognized over the period that the service is rendered to customers. Sales and use and state excise taxes collected from customers that are remitted to the governmental authorities are reported on a net basis and excluded from the revenues and sales. Revenue Recognition-Renewable Energy Revenue from the Company’s Renewable Energy segment is generated from the sale of electricity through long-term power purchase agreements (“PPA’s”) with various customers, or hosts, that range from 10 to 25 years. The Company, which is required to sell all generated power to the hosts, recognizes revenue from the PPA’s as electricity is generated and sold at contractual rates as defined within the respective PPA. The Company’s Renewable Energy segment also generates revenue from the sale of Solar Renewable Energy Credits (“SRECs”). Revenue is recognized as SRECs are sold through long-term purchase agreeements at the contractual rate specified in the agreement. |
Termination and access fee expenses | Termination and access fee expenses. Termination and access fee expenses are charges that are incurred for voice and data transport circuits (in particular, the circuits between the Company’s wireless sites and its switches), internet capacity, other access fees incurred to terminate calls, customer bad debt expense, telecommunication spectrum fees and direct costs associated with the Company’s Renewable Energy segment. |
Engineering and operations expenses | Engineering and operations expenses. Engineering and operations expenses include the expenses associated with developing, operating and supporting the Company’s expanding telecommunications networks and renewable energy operations, including the salaries and benefits incurred to employees directly involved in the development and operation of the Company’s networks and renewable energy operations. |
Sales and marketing expenses | Sales and marketing expenses. Sales and marketing expenses include salaries and benefits incurred to sales personnel, customer service expenses, sales commissions and the costs associated with the development and implementation of promotion and marketing campaigns. |
Equipment expenses | Equipment expenses. Equipment expenses include the costs of handset and customer resale equipment in the Company’s retail businesses. |
General and administrative expenses | General and administrative expenses. General and administrative expenses include salaries, benefits and related costs for general corporate functions including executive management, finance and administration, legal and regulatory, facilities, information technology and human resources. General and administrative expenses also include internal costs associated with the Company’s performance of due-diligence in connection with acquisition activities. |
Transactions-related charges | Transaction-related charges. Transaction-related charges include the external costs, such as legal, tax, accounting and consulting fees directly associated with acquisition and disposition-related activities. Transaction-related charges do not include internal costs, such as employee salary and travel-related expenses, incurred in connection with acquisitions or dispositions or any integration-related costs. |
Restructuring charges | Restructuring charges. Restructuring charges include costs incurred in integrating our newly acquired Companies. |
Depreciation and amortization expenses | Depreciation and amortization expenses. Depreciation and amortization expenses represent the depreciation and amortization charges recorded on our property and equipment and intangible assets. |
Impairment of goodwill and long-lived assets | Impairment of goodwill and long-lived assets. The Company evaluates the carrying value of its long‑lived assets, including property and equipment, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss exists when estimated undiscounted cash flows attributable to non‑current assets subject to depreciation and amortization and discounted cash flows for intangible assets not subject to amortization are less than their carrying amount. If an asset is deemed to be impaired, the amount of the impairment loss recognized represents the excess of the asset’s carrying value as compared to its estimated fair value, based on management’s assumptions and projections. The Company also assesses the carrying value of goodwill and indefinite‑lived intangible assets on an annual basis or more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable. The carrying value of each reporting unit, including goodwill assigned to that reporting unit, is compared to its fair value. If the fair value of the reporting unit does not exceed the carrying value of the reporting unit, including goodwill, an analysis is performed to determine if an impairment charge should be recorded. |
Accounting for Grants | Accounting for Grants The Company has received funding from the U.S. Government and its agencies under Stimulus and Universal Service Fund programs. These funding programs are generally designed to fund telecommunications infrastructure expansion into rural or underserved areas of the United States. The funding programs are evaluated to determine if they represent funding related to capital expenditures (capital grants) or operating activities (income grants). Funding received from Stimulus programs is on a cost‑reimbursement basis for capital expenditures incurred by the Company to expand its network and is considered a capital grant. Accordingly, reimbursements for eligible expenditures under the Stimulus programs are recorded as a reduction to property, plant and equipment on the Company’s consolidated balance sheets, an investing cash inflow and a future reduction in depreciation expense in the consolidated income statements. The depreciable period for the grant is commensurate with the related assets which typically range from 5 to 20 years. As of December 31, 2016, the Company has spent $99.3 million in capital expenditures of which $73.9 million has been or will be funded by the Stimulus programs. Accordingly, funding received for capital expenditures from the Stimulus Programs is recorded as a reduction to property, plant and equipment on the Company’s consolidated balance sheets, an investing cash inflow within capital expenditures and a future reduction in depreciation expense in the consolidated income statements. Funding received for operating costs is recorded as a reduction to the Company’s operating expenses in its consolidated statements of income and an operating cash inflow. Funding received from Universal Service Fund programs is received over time for operating the Company’s network in certain rural geographical areas and is considered an income grant. Accordingly, such funding is recognized as operating cash inflows. Once services are provided, revenue is recognized in the Company’s consolidated income statements. During the year ended December 31, 2016 and December 31, 2015 the Company received approximately $17.7 million and $7.9 million, respectively, from the Universal Service Fund programs. Of these amounts, $9.5 million for the year ended December 31, 2016 and $1.3 million for the year ended December 31, 2015 were to support our U.S. Wireless business relating to high‑cost areas. Funding received from the Phase I Mobility Fund, as further described in Note 9, is for the use of both capital expenditures and operating costs incurred by the Company. Accordingly, funding received for capital expenditures from the Phase I Mobility Fund is recorded as a reduction to property, plant and equipment on the Company’s consolidated balance sheets, an investing cash inflow within capital expenditures and a future reduction in depreciation expense in the consolidated income statements. Funding received for operating costs is recorded as a reduction to the Company’s operating expenses in its consolidated income statements and an operating cash inflow. Compliance with grant requirements is reviewed as of December 31, of each year to ensure that conditions related to grants have been met and there is reasonable assurance that the Company will be able to retain the grant proceeds and to ensure that any contingencies that may arise from not meeting the conditions are appropriately recognized. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax‑planning strategies, and results of recent operations. If the Company determines that it would be able to realize our deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process whereby (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more‑likely‑than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related authority. It is possible that the ultimate resolution of these uncertain matters may be greater or less than the amount that the Company estimated. If payment of these amounts proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period in which it is determined that the liabilities are no longer necessary. If the estimate of tax liabilities proves to be more than the ultimate assessment, a further charge to expense would result. The Company recognizes interest and penalties related to unrecognized tax benefits within the income tax expense line in the accompanying consolidated statements of operations. Accrued interest and penalties are included within the related tax liability line in the consolidated balance sheets. The Company does not provide for United States income taxes on earnings of foreign subsidiaries as such earnings are considered to be indefinitely reinvested. As of December 31, 2014, the Company had deferred taxes that were classified as current and noncurrent assets and liabilities. The Company elected to prospectively adopt ASU 2015-17 as of December 31, 2015, thus reclassifying $3.9 million of current deferred tax assets and $0.2 million of current deferred tax liabilities to noncurrent on the accompanying consolidated December 31, 2015 balance sheet. The adoption of this guidance had no impact on the Company’s consolidated results of income and comprehensive income. |
Credit Concentrations and Significant Customers | Credit Concentrations and Significant Customers The Company has been historically dependent on a limited amount of customers for its wholesale roaming business. The following table indicates the percentage of revenues generated from a single customer that exceeds 10% of the Company’s consolidated revenue in any of the past three years: Customer 2016 2015 2014 Verizon % % % AT&T % % % No other customer accounted for more than 10% of consolidated revenue in any of the past three years. The following table indicates the percentage of accounts receivable, from customers that exceed 10% of the Company’s consolidated accounts receivable, net of allowances, as of December 31, 2016 and 2015: Customer 2016 2015 AT&T % % Verizon % % |
Foreign Currency Gains and Losses | Foreign Currency Gains and Losses We translate the assets and liabilities of our foreign subsidiaries from their respective functional currencies, primarily the Indian Rupee and the Guyana Dollar, to U.S. dollars at the appropriate spot rates as of the balance sheet date. Changes in the carrying value of these assets and liabilities attributable to fluctuations in spot rates are recognized in foreign currency translation adjustment, a component of AOCI. Income statement accounts are translated using the monthly average exchange rates during the year. Monetary assets and liabilities denominated in a currency that is different from a reporting entity’s functional currency must first be remeasured from the applicable currency to the legal entity’s functional currency. The effect of this remeasurement process is reported in other income on the income statement. |
Employee benefit plans | Employee Benefit Plans The company sponsors pension and other postretirement benefit plans for employees of certain subsidiaries. Net periodic pension expense is recognized in the Company’s income statement. The Company recognizes a pension or other postretirement plan’s funded status as either an asset or liability in its consolidated balance sheet. Actuarial gains and losses are reported as a component of other comprehensive income and amortized through net periodic pension expense in subsequent periods. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments 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, 2016 and 2015 are summarized as follows: December 31, 2016 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Short term investments $ $ $ Commercial Paper $ — $ $ Total assets measured at fair value $ $ $ December 31, 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, 2016 and December 31, 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, 2016 and December 31, 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. Short Term Investments and Commercial Paper As of December 31, 2016, this asset class consisted of short term foreign and U.S. corporate bonds and equity securities. Corporate bonds are classified within Level 2 of the fair value hierarchy because the fair value is based on observable market data. Equity securities are classified within Level 1 because fair value is based on quoted market prices in active markets for identical assets. |
Other Fair Value Disclosures | Other Fair Value Disclosures The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable and accrued expenses approximate their fair values because of the relatively short-term maturities of these financial instruments. The fair value of marketable securities is estimated using Level 2 inputs. At December 31, 2016, the fair value of marketable securities approximated its carrying amount of $ 2.0 million and is included in other assets on the consolidated balance sheet. The fair value of long-term debt is estimated using Level 2 inputs. At December 31, 2016, the fair value of long-term debt, including the current portion, was $15 9.9 million and its book value was $ 156.8 million. At December 31, 2015, the fair value of the long-term debt, including the current portion, was equal to its carrying amount of $32 .9 million. |
Net Income Per Share | Net Income Per Share Basic net income per share is computed by dividing net income attributable to the Company’s stockholders by the weighted‑average number of common shares outstanding during the period and does not include any other potentially dilutive securities. Diluted net income per share gives effect to all potentially dilutive securities using the treasury stock method. The reconciliation from basic to diluted weighted average shares of Common Stock outstanding is as follows (in thousands): Year ended December 31, 2016 2015 2014 Basic weighted-average shares of common stock outstanding Stock options Diluted weighted-average shares of common stock outstanding The following notes the number of potential share Common Stock not included in the above calculation because the effects of such were anti‑dilutive (in thousands of shares): For the Year Ended December 31, 2016 2015 2014 Stock options — Total — |
Stock-Based Compensation | Stock‑Based Compensation The Company applies the fair value recognition provisions of the authoritative guidance for the accounting for stock‑based compensation and is expensing the fair value of the grants of options to purchase common stock over their vesting period of four years. Relating to grants of options, the Company recognized $0.1 million, $0.4 million and $0.9 million of non‑cash, share‑based compensation expense during 2016, 2015, and 2014, respectively. See Note 10 for assumptions used to calculate the fair value of the options granted. The Company also issued 100,005 restricted shares of its common stock in 2016; 93,864 restricted shares of common stock in 2015 and 109,318 restricted shares of common stock in 2014. These shares are being charged to income based upon their fair values over their vesting period of four years. Non‑cash equity‑based compensation expense, related to the vesting of restricted shares issued was $6.2 million, $3.4 million and $3.1 million in 2016, 2015, and 2014, respectively. In connection with certain acquisitions, the Company issued shares of the acquired company to its local management and recorded $0.1 and $0.3 million of stock based compensation during 2016 and 2015, respectively. Stock‑based compensation expense is recognized within general and administrative expenses within the consolidated income statements. |
Business combinations | Business Combinations The Company accounts for business combinations using the acquisition method of accounting, under which the purchase price of the acquisition is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. Contingent consideration obligations that are elements of the consideration transferred are recognized as of the acquisition date as part of the fair value transferred in exchange for the acquired business. Acquisition-related costs incurred in connection with a business combination are expensed as incurred. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers”, which provides 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 is now 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 annual reporting periods beginning after December 15, 2016 In March 2016, the FASB issued ASU 2016-08, “Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net).” In April 2016, the FASB issued ASU 2016-10, “Identifying Performance Obligations and Licensing.” In May 2016, the FASB issued ASU 2016-12, “Narrow-Scope Improvements and Practical E xpedients.” In December 2016, the FASB issued Accounting Standards Update 2016-20, “ Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers. ” These updates provide additional adoption guidance and clarification to ASU 2014-09. The amendments must be adopted concurrently. The Company is currently evaluating the overall impact and the method of adoption of ASU 2014-09, including the latest developments from the Transition Resources Group. Areas most likely impacted may include, but not be limited to, the following: the timing of revenue recognition and the allocation of revenue between equipment and services, In addition, the new standard may require certain amounts be recorded in accounts receivable and deferred revenues on the balance sheet and enhanced disclosures around performance obligations. The Company’s final determination of the adoption methodology will depend on a number of factors, such as the significance of the impact of the new standard on the financial results, data and information available at recently acquired businesses, system readiness and the ability to accumulate and analyze the information necessary to assess the impact on prior period financial statements and new disclosure requirements. The Company does not currently know or cannot reasonably estimate quantitative information related to the impact of the new standard on its Consolidated Financial Statements. The Company will adopt the standard on January 1, 2018. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40),” which requires management to assess a company’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. ASU 2014-15 is effective for annual reporting periods ending after December 15, 2016. Early application is permitted. The Company adopted this guidance for the fourth quarter ended December 31, 2016. The adoption of this guidance did not impact the Company’s Consolidated Financial Statements. In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs”, 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 Company retrospectively adopted ASU 2015-03 on January 1, 2016 and determined that its adoption had no impact on its consolidated financial statements and related disclosures. This is a change in accounting principle. In April 2015, the FASB issued ASU 2015-05, “Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement”, which provides guidance about whether a cloud computing arrangement includes software and how to account for that software license. The new guidance does not change the accounting for a customer’s accounting for service contracts. The standard is effective beginning January 1, 2017, with early adoption permitted, and may be applied prospectively or retrospectively. The Company does not expect ASU 2015-05 to have a material impact on its consolidated financial position, results of operations or cash flows. In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments”, which provides updated guidance related to simplifying the accounting for measurement period adjustments related to business combinations. The amended guidance eliminates the requirement to retrospectively account for adjustments made during the measurement period. The standard was adopted January 1, 2016, and did not have a material impact on its consolidated financial position, results of operations or cash flows. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”, which provides comprehensive lease accounting guidance. The standard requires entities to recognize lease assets and liabilities on the balance sheet as well as disclosure of key information about leasing arrangements. ASU 2016-02 will become effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The standard is intended to simplify several areas of accounting for share-based compensation arrangements, including the income tax impact, classification on the statement of cash flows and forfeitures. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is permitted. The Company is currently evaluating the impact that the standard will have on its Consolidated Financial Statements. In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments,” which provides further clarification on eight cash flow classification issues. The standard further clarifies the classification of the following: (i) debt prepayment or debt extinguishment costs; (ii) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; (iii) contingent consideration payments made after a business combination; (iv) proceeds from the settlement of insurance claims; (v) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (vi) distributions received from equity method investees; (vii) beneficial interests in securitization transactions; and (viii) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 will become effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. ASU 2016-15 should be applied using a retrospective transition method for each period presented. The Company is currently evaluating the impact of the new standard on our consolidated financial statements. In October 2016 the FASB issued ASU 2016-16, Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory . The new standard eliminates for all intra-entity sales of assets other than inventory, the exception under current standards that permits the tax effects of intra-entity asset transfers to be deferred until the transferred asset is sold to a third party or otherwise recovered through use. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The new standard will be effective for the Company on January 1, 2018. The Company is currently evaluating the potential impact that this standard may have on its results of operations. In November 2016, the FASB issued Accounting Standards Update 2016-18, “ Statement of Cash Flows (Topic 230): Restricted Cash ,” or ASU 2016-18. The amendments in ASU 2016-18 are intended to reduce diversity in practice related to the classification and presentation of changes in restricted cash or restricted cash equivalents on the statement of cash flows. The amendments in ASU 2016-18 require that amounts generally described as restricted cash and restricted cash equivalents be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. ASU 2016-18 is effective for annual reporting periods, including interim periods within those periods, beginning after December 15, 2017, with early adoption permitted. The Company is currently evaluation the potential impact that this standard may have on its Consolidated Financial Statements. In January 2017, the FASB issued Accounting Standards Update 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business,” or ASU 2017-01. The amendments in ASU 2017-01 provide a screen to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. Under ASU 2017-01, an entity first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set is not a business. If it’s not met, the entity then evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. ASU 2017-01 also narrows the definition of outputs by more closely aligning it with how outputs are described in ASC 606. ASU 2017-01 is effective for annual reporting periods, including interim periods within those periods, beginning after December 15, 2017, with early adoption permitted. The Company prospectively adopted ASU 2017-01 for the fourth quarter of 2016. The standard will result in the Company accounting for more transactions as asset acquisitions as opposed to business combination. In January 2017, the FASB issued Accounting Standards Update 2017-04, “Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” or ASU 2017-04. The amendments in ASU 2017-04 simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities. Instead, under the amendments in ASU 2017-04, an entity performs its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognizes an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, but not more than the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for annual reporting periods, including interim periods within those periods, beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluation the potential impact that this standard may have on its Consolidated Financial Statements. |
ORGANIZATION AND BUSINESS OPE30
ORGANIZATION AND BUSINESS OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
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 | The following chart summarizes the operating activities of the Company’s principal subsidiaries, the segments in which it reports its revenue and the markets it served as of December 31, 2016: Segment Services Markets Tradenames U.S. Telecom Wireless United States (rural markets) Commnet, Choice, Choice NTUA Wireless Wireline United States (New England and New York State) Sovernet, ION, Essextel International Telecom Wireline Guyana, Bermuda, U.S. Virgin Islands GTT+, One, Innovative, Logic Wireless Bermuda, Guyana, U.S. Virgin Islands One, GTT+, Innovative, Choice Video Services Bermuda, U.S. Virgin Islands, Cayman Islands, British Virgin Islands, St. Maarten One, Innovative, Logic, BVI Cable TV Renewable Energy Solar United States and India Ahana Renewables, Vibrant Energy |
SUMMARY OF SIGNIFICANT ACCOUN31
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of changes in accumulated other comprehensive income (loss), by component | Changes in accumulated other comprehensive income (loss), by component, were as follows (in thousands): Projected Pension Benefit Translation Short Term Obligation Adjustment Investment Total Balance at December 31, 2013 $ — Adjust funded status of pension plan, net of tax of $0.6 million — — Foreign currency translation adjustment — — Balance at December 31, 2014 — Adjust funded status of pension plan, net of tax of $0.7 million — — Foreign currency translation adjustment — — Balance at December 31, 2015 — Adjust funded status of pension plan, net of tax of $0.7 million — — Foreign currency translation adjustment — — Unrealized gain on marketable securities — — Balance at December 31, 2016 $ $ $ $ Amounts totaling $1.3 million, $0.2 million, and $0.2 million were reclassified from other comprehensive income to general and administrative operating expense related to the Company’s defined pension plans for the years ending December 31, 2016, 2015, and 2014, respectively . |
Schedule of percentage of revenues generated from a single customer that exceeds 10% of the Company's consolidated revenue | Customer 2016 2015 2014 Verizon % % % AT&T % % % |
Schedule of percentage of accounts receivable, from customers that exceed 10% of the Company's consolidated accounts receivable, net of allowances | Customer 2016 2015 AT&T % % Verizon % % |
Schedule of assets and liabilities of the Company measured at fair value on a recurring basis | December 31, 2016 Significant Other Quoted Prices in Observable Active Markets Inputs Description (Level 1) (Level 2) Total Certificates of deposit $ — $ $ Money market funds $ $ — $ Short term investments $ $ $ Commercial Paper $ — $ $ Total assets measured at fair value $ $ $ December 31, 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 $ $ $ |
Schedule of reconciliation from basic to diluted weighted average common shares outstanding | The reconciliation from basic to diluted weighted average shares of Common Stock outstanding is as follows (in thousands): Year ended December 31, 2016 2015 2014 Basic weighted-average shares of common stock outstanding Stock options Diluted weighted-average shares of common stock outstanding |
Schedule of anti-dilutive potential shares that were excluded from the computation of diluted weighted average shares outstanding | The following notes the number of potential share Common Stock not included in the above calculation because the effects of such were anti‑dilutive (in thousands of shares): For the Year Ended December 31, 2016 2015 2014 Stock options — Total — |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Acquisitions | |
Schedule of pro forma results of operations | Amounts are presented in thousands, except per share data: Year ended December 31, (unaudited) 2016 2015 As Pro- As Pro- Reported Forma Reported Forma Revenue $ $ $ $ Net income (loss) attributable to ATN International, Inc. Stockholders Earnings per share: Basic Diluted |
One Communications (formerly KeyTech) and BDC | |
Acquisitions | |
Schedule of assessment of total acquisition costs to net assets based on acquisition date fair values | Consideration Transferred Cash consideration - KeyTech $ Cash consideration - BDC Total consideration transferred Non-controlling interests - KeyTech Total value to allocate $ Value to allocate KeyTech Value to allocate - BDC Purchase price allocation KeyTech: Cash Accounts receivable Other current assets Property, plant and equipment Identifiable intangible assets Other long term assets Accounts payable and accrued liabilities Advance payments and deposits Current debt Long term debt Net assets acquired Gain on KeyTech bargain purchase $ Purchase price allocation BDC: Carrying value of BDC non-controlling interest acquired Excess of purchase price paid over carrying value of non-controlling interest acquired $ |
Innovative | |
Acquisitions | |
Schedule of assessment of total acquisition costs to net assets based on acquisition date fair values | Consideration Transferred $ Non-controlling interests Total value to allocate Purchase price allocation: Cash Accounts receivable Materials & supplies Other current assets Property, plant and equipment Telecommunication licenses Goodwill Intangible assets Other Assets Accounts payable and accrued liabilities Advance payments and deposits Deferred tax liability Pension and other postretirement benefit liabilities Net assets acquired $ |
Vibrant Energy | |
Acquisitions | |
Schedule of assessment of total acquisition costs to net assets based on acquisition date fair values | The table below represents the allocation of the consideration transferred to the net assets of Vibrant Energy based on their acquisition date fair values (in thousands): Consideration Transferred $ Purchase price allocation: Cash $ Prepayments and other assets Property, plant and equipment Goodwill Accounts payable and accrued liabilities Net assets acquired $ |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
ACCOUNTS RECEIVABLE: | |
Schedule of accounts receivable | As of December 31, 2016 and 2015, accounts receivable consist of the following (in thousands): 2016 2015 Retail $ $ Wholesale Other Accounts receivable Less: allowance for doubtful accounts Total accounts receivable, net $ $ |
FIXED ASSETS (Tables)
FIXED ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
FIXED ASSETS: | |
Schedule of property, plant and equipment | As of December 31, 2016 and 2015, property, plant and equipment consisted of the following (in thousands): Useful Life (in Years) 2016 2015 Telecommunications equipment and towers 5 -15 $ $ Solar assets 20-23 Office and computer equipment 3 -10 Buildings 15-39 Transportation vehicles 3 -10 Leasehold improvements Shorter of useful Land — Furniture and fixtures 5 -10 Total property, plant and equipment Construction in progress Total property, plant and equipment Less: Accumulated depreciation Net fixed assets $ |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of changes in the carrying amount of goodwill, by operating segment | There were no changes to the Company’s goodwill balances from January 1, 2014 through December 31, 2015 (in thousands): U.S. International Renewable Telecom Telecom Energy Consolidated Balance at December 31, 2015 $ $ $ — $ Acquisitions Deconsolidation of Subsidiary — — Impairment — — Balance at December 31, 2016 Gross Accumulated Impairment — — Net $ $ $ $ |
Schedule of changes in the carrying amount of the Company's telecommunications licenses, by operating segment | The changes in the carrying amount of the Company’s telecommunications licenses, by operating segment, for the three years ended December 31, 2016 were as follows (in thousands): U.S. Int'l Telecom Telecom Consolidated Balance at December 31, 2014 $ $ $ Amortization — Balance at December 31, 2015 $ $ $ Deconsolidation of subsidiary — Acquired licenses — Amortization — Balance at December 31, 2016 $ $ $ |
Schedule of future amortization of customer relationships, in Island Wireless segment | Future amortization of customer relationships, in our International Telecom segment, is as follows (in thousands): Future Amortization 2017 $ 2018 2019 2020 2021 Thereafter Total $ |
EQUITY (Tables)
EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Schedule of repurchases of shares from employees to satisfy tax withholding and stock exercise obligations | Aggregate Shares Cost Average Year ended December 31, Repurchased (in thousands) Repurchase Price 2016 $ $ 2015 2014 |
Summary of stock option activity | Year Ended December 31, 2016 Weighted Average Weighted Avg. Remaining Number of Exercise Contractual Aggregate Options Price Term (Years) Intrinsic Value Outstanding at January 1, 2016 $ Granted — — Exercised Outstanding at December 31, 2016 $ Vested and expected to vest at December 31, 2016 $ Exercisable at December 31, 2016 $ Year Ended December 31, 2015 Weighted Average Remaining Number of Weighted Avg. Contractual Aggregate Options Exercise Price Term (Years) Intrinsic Value Outstanding at January 1, 2015 $ Granted Exercised Outstanding at December 31, 2015 $ Vested and expected to vest at December 31, 2015 $ Exercisable at December 31, 2015 $ |
Summary of information relating to options granted and exercised | The following table summarizes information relating to options granted and exercised during the years ended December 31, 2016, 2015 and 2014 (in thousands, except fair value of options granted data): 2016 2015 2014 Weighted-average fair value of options granted $ — $ $ N/A Aggregate intrinsic value of options exercised Cash proceeds received upon exercise of options Excess tax benefits from share-based compensation |
Schedule of weighted-average assumptions using Black-Scholes option-pricing model for estimating fair value of each option granted | Risk-free interest rate % Expected dividend yield % Expected life years Expected volatility % |
Summary of restricted stock activity | The following table summarizes restricted stock activity during the year ended December 31, 2016: Weighted Avg. Shares Fair Value Unvested as of January 1, 2016 $ Granted Forfeited Vested and issued Unvested as of December 31, 2016 $ The following table summarizes restricted stock activity during the year ended December 31, 2015: Weighted Avg. Shares Fair Value Unvested as of January 1, 2015 $ Granted Forfeited Vested and issued Unvested as of December 31, 2015 $ |
2004 and 2016 Repurchase Plan | |
Schedule of shares repurchased | Aggregate Shares Cost Average Year ended December 31, Repurchased (in thousands) Repurchase Price 2016 $ $ 2015 — — — 2014 — — — |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
INCOME TAXES | |
Schedule of components of income before income taxes | The components of income before income taxes for the years ended December 31, 2016, 2015 and 2014 are as follows (in thousands): 2016 2015 2014 Domestic $ $ $ Foreign Total $ $ $ |
Schedule of reconciliation from the tax computed at statutory income tax rates to the Company's income tax expense | 2016 2015 2014 Domestic $ $ $ Foreign Total $ $ $ The following is a reconciliation from the tax computed at statutory income tax rates to the Company’s income tax expense for the years ended December 31, 2016, 2015, and 2014 (in thousands): 2016 2015 2014 Tax computed at statutory U.S. federal income tax rates $ $ $ Non controlling interest Foreign tax rate differential Over (under) provided in prior periods Nondeductible expenses Goodwill Impairment — — Capitalized transactions costs — — Change in tax reserves State Taxes, net of federal benefit Change in valuation allowance Foreign tax credit expiration Other, net Total Income Tax Expense $ $ $ |
Schedule of components of income tax expense (benefit) | The components of income tax expense (benefit) for the years ended December 31, 2016, 2015 and 2014 are as follows (in thousands): \ 2016 2015 2014 Current: United States—Federal $ $ $ United States—State Foreign Total current income tax expense $ $ $ Deferred: United States—Federal $ $ $ United States—State Foreign Total deferred income tax expense (benefit) Consolidated: United States—Federal $ $ $ United States—State Foreign Total income tax expense $ $ $ |
Schedule of significant components of deferred tax assets and liabilities | The significant components of deferred tax assets and liabilities are as follows as of December 31, 2016 and 2015 (in thousands): 2016 2015 Deferred tax assets: Receivables reserve $ $ Temporary differences not currently deductible for tax Deferred compensation Foreign tax credit carryforwards — Pension Net operating losses Total deferred tax asset Deferred tax liabilities: Property, plant and equipment, net $ $ Intangible assets, net Total deferred tax liabilities Valuation allowance Net deferred tax liabilities $ $ |
Schedule of deferred tax assets and liabilities | Deferred tax assets and liabilities are reflected in the accompanying consolidated balance sheets as follows (in thousands): 2016 2015 Deferred tax assets: Current $ — $ — Long term — Total deferred tax asset $ $ — Deferred tax liabilities: Current $ — $ — Long term Total deferred tax liabilities $ $ Net deferred tax liabilities $ $ |
Schedule of activity related to unrecognized tax benefits | The following shows the activity related to unrecognized tax benefits (not including interest and penalty) during the three years ended December 31, 2016 (in thousands): Gross unrecognized tax benefits at December 31, 2013 Increase in unrecognized tax benefits taken during a prior period Increase in unrecognized tax benefits taken during the current period Lapse in statute of limitations Settlements — Gross unrecognized tax benefits at December 31, 2014 Increase in unrecognized tax benefits taken during a prior period — Increase in unrecognized tax benefits taken during the current period Lapse in statute of limitations — Settlements — Gross unrecognized uncertain tax benefits at December 31, 2015 Increase in unrecognized tax benefits taken during a prior period Increase in unrecognized tax benefits taken during the current period Lapse in statute of limitations Settlements Gross unrecognized uncertain tax benefits at December 31, 2016 $ |
RETIREMENT PLANS (Tables)
RETIREMENT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
RETIREMENT PLANS | |
Schedule of weighted-average rates assumed in the actuarial calculations for the pension plan and other postretirement benefit plans | 2016 2015 2014 Discount Rate – Pension Benefit % % % Discount Rate – Postretirement Benefit % N/A N/A Annual salary increase % % % Expected long-term return on plan assets % % % |
Schedule of effect of one-percentage point increase in assumed health care cost trend rates of net periodic postretirement health care benefit cost | Accumulated postretirement benefit obligation Service cost plus interest cost At trend At trend + 1% Dollar Impact Percentage Impact % % At trend – 1% Dollar Impact Percentage Impact % % |
Schedule of changes during the year in the projected benefit obligations and in the fair value of plan assets | Changes during the year in the projected benefit obligations and in the fair value of plan assets are as follows for 2016 and 2015 (in thousands): 2016 2015 Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Projected benefit obligations: Balance at beginning of year: $ $ — $ $ — Innovative Acquisition — — Service cost — Interest cost — Curtailment — — — Benefits and settlements paid — Actuarial (gain) loss — Experience loss — — Balance at end of year $ $ $ $ — Plan net assets: Balance at beginning of year: $ $ — $ $ — Innovative Acquisition — — — Actual return on plan assets — — Company contributions — — Benefits and settlements paid — Balance at end of year $ $ — $ $ — Under funded status of plan $ $ $ $ — |
Schedule of funded status of the Company’s pension and other retirement benefit plans | The funded status of the Company’s pension and other retirement benefit plans is below (in thousands): 2016 2015 GTT Pension Benefit Innovative Pension Benefit Postretirement Benefits GTT Pension Benefit Innovative Pension Benefit Postretirement Benefits Projected benefit obligation $ $ $ $ $ — $ — Plan Net Assets — — — Over/ (Under) funded status of plan $ $ $ $ $ — $ — |
Schedule of fair values for the pension plan's net assets, by asset category | The fair values for the pension plan’s net assets, by asset category, at December 31, 2016 are as follows (in thousands): Asset Category Total Level 1 Level 2 Level 3 Cash, cash equivalents, money markets and other $ $ $ — $ — Common stock - domestic — — Common stock - foreign — Mutual funds - equities — Exchange traded funds - equities — — Fixed income mutual funds — — Fixed income securities — — Annuities — — Total $ $ $ $ |
Schedule of weighted-average asset allocations, by asset category | 2016 2015 Cash, cash equivalents, money markets and other % % Common stock - domestic Common stock - foreign — Mutual funds - equities — Exchange traded funds - equities — Fixed income mutual funds — Fixed income securities Annuities — Total % % |
Schedule of amounts recognized on the Company's consolidated balance sheets | 2016 2015 Cash, cash equivalents, money markets and other % % Common stock - domestic Common stock - foreign — Mutual funds - equities — Exchange traded funds - equities — Fixed income mutual funds — Fixed income securities Annuities — Total % % Amounts recognized on the Company’s consolidated balance sheets consist of (in thousands): As of December 31, 2016 2015 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Accrued and current liabilities $ — $ $ — $ — Other Liabilities — Other Assets — — — Accumulated other comprehensive income / (loss), net of tax — |
Schedule of amounts recognized in accumulated other comprehensive loss | Amounts recognized in accumulated other comprehensive loss consist of (in thousands): As of December 31, 2016 2015 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Net actuarial gain / (loss) $ $ $ $ — Accumulated other comprehensive income / ( loss), pre-tax — Accumulated other comprehensive income / ( loss), net of tax — |
Schedule of components of the plan's net periodic pension cost | As of December 31, 2016 2015 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Net actuarial gain / (loss) $ $ $ $ — Accumulated other comprehensive income / ( loss), pre-tax — Accumulated other comprehensive income / ( loss), net of tax — Components of the plan’s net periodic pension cost are as follows for the years ended December 31, 2016, 2015 and 2014 (in thousands): 2016 2015 2014 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Pension benefits Postretirement benefits Service cost $ $ $ $ — $ $ — Interest cost — — Expected return on plan assets — — — Amortization of unrecognized net actuarial loss — — — Curtailment — — — — — Net periodic pension cost $ $ $ $ — $ $ — |
Schedule of estimated pension benefits | The following estimated pension benefits, which reflect expected future service, as appropriate, are expected to be paid over the next ten years as indicated below (in thousands): Pension Fiscal Year Benefits 2017 $ 2018 2019 2020 2021 2022 - 2026 $ |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of the Company's obligation for payments under leases | The Company’s obligations for payments under these leases are as follows at December 31, 2016 (in thousands): 2017 2018 2019 2020 2021 Thereafter Total obligations under operating leases $ |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
SEGMENT REPORTING | |
Schedule of information for each operating segment | The following tables provide information for each operating segment (in thousands): For the Year Ended December 31, 2016 U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated Revenue Wireless $ $ $ — $ — $ Wireline — — Equipment and Other — Renewable Energy — — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — Operating income (loss) For the Year Ended December 31, 2015 U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated Revenue Wireless $ $ $ — $ — $ Wireline — — Equipment and Other — — Renewable Energy — — — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — Operating income (loss) For the Year Ended December 31, 2014 U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated Revenue Wireless $ $ $ — $ — $ Wireline — — Equipment and Other — Total Revenue — Depreciation and amortization Non-cash stock-based compensation — — — Operating income (loss) U.S. International Renewable Reconciling Telecom Telecom Energy Items (1) Consolidated December 31, 2016 Net fixed assets $ $ $ $ $ Goodwill — Total assets December 31, 2015 Net fixed assets $ $ $ $ $ Goodwill — — Total assets Capital Expenditures U.S. International Renewable Reconciling Year ended December 31, Telecom Telecom Energy Items (1) Consolidated 2016 $ $ $ $ $ 2015 (1) Reconciling items refer to corporate overhead expenses and consolidating adjustments. |
Schedule of revenues and long lived assets by geographic location | The table below identifies the Company’s revenues and long-lived assets by geographic location. The Company attributes revenue to geographic location based on location of the customer (in thousands): 2016 2015 2014 Long-Lived Long-Lived Long-Lived Revenues Assets Revenues Assets Revenues Assets U.S. $ $ $ $ $ $ Guyana U.S Virgin Islands Bermuda Other Foreign Countries $ $ $ $ $ $ |
QUARTERLY FINANCIAL DATA (UNA41
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | |
Summary of the Company's quarterly results of operations | 16. QUARTERLY FINANCIAL DATA (UNAUDITED) Following is a summary of the Company’s quarterly results of operations for the years ended December 31, 2016 and 2015 (in thousands): 2016 Consolidated for the Three Months Ended March 31 June 30 September 30 December 31 Total revenue $ $ $ $ Operating expenses Income from operations Other income (expense), net Income (Loss)from continuing operations before income taxes Income taxes Income (Loss) from continuing operations Income from discontinued operations: Income from discontinued operations, net of tax — — — — Net income Net income attributable to non-controlling interests, net of tax: Continuing operations Net income attributable to ATN International, Inc. stockholders Net income per weighted average basic share attributable to ATN International, Inc. stockholders Continuing operations Total Net income per weighted average diluted share attributable to ATN International, Inc. stockholders Continuing operations Total 2015 Consolidated for the Three Months Ended March 31 June 30 September 30 December 31 Total revenue $ $ $ $ Operating expenses Income from operations Other income (expense), net Income from continuing operations before income taxes Income taxes Income from continuing operations Income from discontinued operations: Gain on sale of discontinued operations, net of tax — — Income from discontinued operations, net of tax — — Net income Net income attributable to non-controlling interests, net of tax: Continuing operations Discontinued operations — — — — Disposal of discontinued operations — — — — Net income attributable to ATN International, Inc. stockholders Net income per weighted average basic share attributable to ATN International, Inc. stockholders Continuing operations Discontinued operations: Discontinued operations — — — Gain on sale of discontinued operations — — — — Total discontinued operations — — — Total Net income per weighted average diluted share attributable to ATN International, Inc. stockholders Continuing operations Discontinued operations: Discontinued operations — — — Gain on Sale of discontinued operations — — — — Total discontinued operations — — — Total During the three months ended December 31, 2015, the Company recognized an approximate $0.7 million benefit to correct for tax basis differences and expense recognition related to prior periods. Of these errors, $0.7 million primarily related to the three months ended September 30, 2015. During the three months ended December 31, 2016, the Company recognized an approximate $0.8 million charge to correct for a $0.3 million understatement of expense related primarily to the nine months ended September 30, 2016 in our International Telecom segment and a $0.5 million reduction to revenue primarily related to the nine months ended September 30, 2016 in our Renewable Energy segment. The Company determined that the impact of the correction of these errors was not material to the current or any prior period financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN42
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reclassifications (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2015 | |
Prior period corrections | |||
Reclassification, decrease (increase) to expense | $ (0.8) | $ 0.7 | |
Termination and access fees | |||
Prior period corrections | |||
Reclassification, decrease (increase) to expense | $ (4.1) | ||
Engineering and operations expenses | |||
Prior period corrections | |||
Reclassification, decrease (increase) to expense | 2.3 | ||
Selling and marketing expense | |||
Prior period corrections | |||
Reclassification, decrease (increase) to expense | 2.4 | ||
General and administrative expense | |||
Prior period corrections | |||
Reclassification, decrease (increase) to expense | $ (0.5) |
SUMMARY OF SIGNIFICANT ACCOUN43
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Deposits (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash | ||
Deposit with non-insured institutions | $ 24.3 | |
Guyanese dollars | ||
Cash | ||
Cash (in GYD) | $ 7.5 | $ 3.8 |
Minimum | Corporate bonds | ||
Cash | ||
Investment maturity term | 3 months | |
Maximum | ||
Cash | ||
Investment maturity term | 3 months | |
Maximum | Corporate bonds | ||
Cash | ||
Investment maturity term | 1 year |
SUMMARY OF SIGNIFICANT ACCOUN44
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fixed Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fixed assets | ||
Accrued asset retirement obligations | $ 3.2 | $ 3 |
Minimum | ||
Fixed assets | ||
Useful life | 3 years | |
Maximum | ||
Fixed assets | ||
Useful life | 39 years |
SUMMARY OF SIGNIFICANT ACCOUN45
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Acquired Intangibles (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Intangible assets | ||
Telecommunications license impairment | $ 0 | $ 0 |
Customer relationships | Minimum | ||
Intangible assets | ||
Estimated life | 7 years | |
Customer relationships | Maximum | ||
Intangible assets | ||
Estimated life | 13 years |
SUMMARY OF SIGNIFICANT ACCOUN46
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - AOCI (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accumulated other comprehensive income (loss) | |||
Stockholders' Equity Attributable to Parent, Beginning Balance | $ 680,299 | ||
Adjust funded status of pension plan, net of tax | 5,251 | $ (809) | $ (724) |
Adjust funded status of pension plan, tax | 700 | 700 | 600 |
Foreign currency translation adjustment | (687) | 26 | 4 |
Unrealized Gain on Marketable Securities | 868 | ||
Stockholders' Equity Attributable to Parent, Ending Balance | 677,055 | 680,299 | |
Short Term Investments | |||
Accumulated other comprehensive income (loss) | |||
Unrealized Gain on Marketable Securities | 868 | ||
Stockholders' Equity Attributable to Parent, Ending Balance | 868 | ||
Projected Pension Benefit Obligation | |||
Accumulated other comprehensive income (loss) | |||
Stockholders' Equity Attributable to Parent, Beginning Balance | (3,481) | (2,672) | (1,949) |
Adjust funded status of pension plan, net of tax | 5,251 | (809) | (723) |
Stockholders' Equity Attributable to Parent, Ending Balance | 1,770 | (3,481) | (2,672) |
Amounts reclassified from accumulated other comprehensive income, net of tax | 1,300 | 200 | 200 |
Translation Adjustment | |||
Accumulated other comprehensive income (loss) | |||
Stockholders' Equity Attributable to Parent, Beginning Balance | (223) | (249) | (253) |
Foreign currency translation adjustment | (687) | 26 | 4 |
Stockholders' Equity Attributable to Parent, Ending Balance | (910) | (223) | (249) |
Accumulated Other Comprehensive Income/(Loss) | |||
Accumulated other comprehensive income (loss) | |||
Stockholders' Equity Attributable to Parent, Beginning Balance | (3,704) | (2,921) | (2,202) |
Adjust funded status of pension plan, net of tax | 5,251 | (809) | (723) |
Foreign currency translation adjustment | (687) | 26 | 4 |
Unrealized Gain on Marketable Securities | 868 | ||
Stockholders' Equity Attributable to Parent, Ending Balance | $ 1,728 | $ (3,704) | $ (2,921) |
SUMMARY OF SIGNIFICANT ACCOUN47
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Grants (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounting for grants | |||
Amount spent in capital expenditures | $ 124,282 | $ 64,753 | $ 58,300 |
U.S. Telecom | |||
Accounting for grants | |||
Amount received | $ 9,500 | 1,300 | |
Minimum | |||
Accounting for grants | |||
Long-term power purchase agreements term | 10 years | ||
Term of depreciation of grant | 5 years | ||
Maximum | |||
Accounting for grants | |||
Long-term power purchase agreements term | 25 years | ||
Term of depreciation of grant | 20 years | ||
Stimulus programs | |||
Accounting for grants | |||
Amount spent in capital expenditures | $ 99,300 | ||
Amount that has been funded or will be funded | 73,900 | ||
Universal Service Fund programs | |||
Accounting for grants | |||
Amount received | $ 17,700 | $ 7,900 |
SUMMARY OF SIGNIFICANT ACCOUN48
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax Assets, Net, Noncurrent | $ 407 | |
Deferred Tax Liabilities, Net, Noncurrent | $ 46,622 | $ 45,406 |
Accounting Standards Update 2015-17 | ||
Deferred Tax Assets, Net, Current | (3,900) | |
Deferred Tax Assets, Net, Noncurrent | 3,900 | |
Deferred Tax Liabilities, Net, Current | (200) | |
Deferred Tax Liabilities, Net, Noncurrent | $ 200 |
SUMMARY OF SIGNIFICANT ACCOUN49
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Risk (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues | Customer concentration | AT&T | |||
Credit concentrations and significant customers | |||
Percentage of concentration risk | 14.00% | 17.00% | 26.00% |
Revenues | Customer concentration | Verizon | |||
Credit concentrations and significant customers | |||
Percentage of concentration risk | 12.00% | 19.00% | 16.00% |
Accounts receivable | Credit concentration | AT&T | |||
Credit concentrations and significant customers | |||
Percentage of concentration risk | 17.00% | 17.00% | |
Accounts receivable | Credit concentration | Verizon | |||
Credit concentrations and significant customers | |||
Percentage of concentration risk | 12.00% | 13.00% |
SUMMARY OF SIGNIFICANT ACCOUN50
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair value Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair value measurements | ||
Long-term debt, carrying value | $ 156,800 | $ 32,900 |
Significant Other Observable Inputs (Level 2) | ||
Fair value measurements | ||
Marketable securities, fair value | 2,000 | |
Long-term Debt, Fair Value | 159,900 | 32,900 |
Recurring basis | Total | ||
Fair value measurements | ||
Total assets measured at fair value | 68,636 | 76,640 |
Recurring basis | Certificate of deposit | Total | ||
Fair value measurements | ||
Cash and cash equivalents | 391 | 377 |
Recurring basis | Money market funds | Total | ||
Fair value measurements | ||
Cash and cash equivalents | 29,027 | 76,263 |
Recurring basis | Short Term Investments | Total | ||
Fair value measurements | ||
Investments, Fair Value Disclosure | 9,237 | |
Recurring basis | Commercial Paper | Total | ||
Fair value measurements | ||
Cash and cash equivalents | 29,981 | |
Recurring basis | Quoted Prices in Active Markets (Level 1) | ||
Fair value measurements | ||
Total assets measured at fair value | 30,778 | 76,263 |
Recurring basis | Quoted Prices in Active Markets (Level 1) | Money market funds | ||
Fair value measurements | ||
Cash and cash equivalents | 29,027 | 76,263 |
Recurring basis | Quoted Prices in Active Markets (Level 1) | Short Term Investments | ||
Fair value measurements | ||
Investments, Fair Value Disclosure | 1,751 | |
Recurring basis | Significant Other Observable Inputs (Level 2) | ||
Fair value measurements | ||
Total assets measured at fair value | 37,858 | 377 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Certificate of deposit | ||
Fair value measurements | ||
Cash and cash equivalents | 391 | $ 377 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Short Term Investments | ||
Fair value measurements | ||
Investments, Fair Value Disclosure | 7,486 | |
Recurring basis | Significant Other Observable Inputs (Level 2) | Commercial Paper | ||
Fair value measurements | ||
Cash and cash equivalents | $ 29,981 |
SUMMARY OF SIGNIFICANT ACCOUN51
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Anti-dilution (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Anti-dilutive common shares not included for computation of earnings per share | |||
Anti-dilutive potential shares excluded from the computation of diluted weighted average shares outstanding (in shares) | 5 | 2 | |
Basic weighted-average shares of common stock outstanding | 16,131 | 16,022 | 15,898 |
Stock options (in shares) | 96 | 120 | 115 |
Diluted weighted-average shares of common stock outstanding | 16,227 | 16,142 | 16,013 |
Stock options | |||
Anti-dilutive common shares not included for computation of earnings per share | |||
Anti-dilutive potential shares excluded from the computation of diluted weighted average shares outstanding (in shares) | 5 | 2 |
SUMMARY OF SIGNIFICANT ACCOUN52
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Stock-Based Compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stock-based compensation | |||
Non-cash stock-based compensation | $ 6,410 | $ 4,975 | $ 4,323 |
Stock options | |||
Stock-based compensation | |||
Vesting period | 4 years | ||
Non-cash stock-based compensation | $ 100 | $ 400 | $ 900 |
Restricted Stock | |||
Stock-based compensation | |||
Restricted shares of common stock issued (in shares) | 100,005 | 93,864 | 109,318 |
Vesting period | 4 years | ||
Non-cash stock-based compensation | $ 6,200 | $ 3,400 | $ 3,100 |
Acquisitions | Management | |||
Stock-based compensation | |||
Non-cash stock-based compensation | $ 100 | $ 300 |
ACQUISITIONS AND DISPOSITIONS53
ACQUISITIONS AND DISPOSITIONS (Details) $ in Thousands | May 03, 2016USD ($) |
One Communications (formerly KeyTech) | |
Acquisitions | |
Ownership interest held by minority shareholders | 43.00% |
One Communications (formerly KeyTech) | |
Acquisitions | |
Minority ownership contributed in acquisition (as a percent) | 43.00% |
One Communications (formerly KeyTech) and BDC | |
Acquisitions | |
Ownership interest held by minority shareholders | 15.00% |
Ownership interest acquired (as a percent) | 51.00% |
Total consideration | $ 41,563 |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jul. 01, 2016 | May 03, 2016 | Apr. 07, 2016 | Jul. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2015 |
Consideration Transferred | |||||||||||||||||
Pension funding required by Innovative acquisition | $ 22,494 | ||||||||||||||||
Purchase price allocation: | |||||||||||||||||
Goodwill | $ 62,873 | $ 45,077 | 62,873 | $ 45,077 | $ 45,077 | ||||||||||||
Gain on KeyTech bargain purchase | 7,304 | ||||||||||||||||
Increase in goodwill | 0 | ||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Revenue | 128,531 | $ 138,795 | $ 99,991 | $ 89,686 | 82,916 | $ 96,782 | $ 90,326 | $ 85,345 | 457,003 | 355,369 | $ 336,347 | ||||||
Income (Loss) from Continuing Operations before Income Taxes | 7,590 | $ 21,296 | $ 1,059 | $ 15,429 | 7,763 | $ 21,782 | $ 28,026 | $ (1,370) | 45,374 | 56,201 | 86,168 | ||||||
Transaction related charges | 16,279 | 7,182 | $ 2,959 | ||||||||||||||
Loss on deconsolidation of subsidiary | 19,937 | ||||||||||||||||
Deconsolidation of non-controlling interests | 310 | (20,013) | |||||||||||||||
Goodwill | |||||||||||||||||
Impairment of long-lived assets | 3,600 | ||||||||||||||||
Goodwill impairment | $ 7,491 | ||||||||||||||||
Discount rate (as a percent) | 14.00% | ||||||||||||||||
Impairment of long-lived assets | $ 11,425 | ||||||||||||||||
Aruba | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Revenue | 2,800 | ||||||||||||||||
Postretirement Benefits | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Restricted cash | 5,100 | 5,100 | |||||||||||||||
Non-Controlling Interests | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Deconsolidation of non-controlling interests | 310 | (20,013) | |||||||||||||||
BDC | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Cash consideration | $ 7,045 | ||||||||||||||||
Total value to allocate | |||||||||||||||||
Business Combination Total Value Allocation | 7,045 | ||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Acquired carrying value of BDC non-controlling interest acquired | 2,940 | ||||||||||||||||
Excess of purchase price paid over carrying value of non-controlling interest acquired | 4,105 | ||||||||||||||||
One Communications (formerly KeyTech) | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Cash consideration | 34,518 | ||||||||||||||||
Total value to allocate | |||||||||||||||||
Non-controlling interests | 32,909 | ||||||||||||||||
Business Combination Total Value Allocation | 67,427 | ||||||||||||||||
Purchase price allocation: | |||||||||||||||||
Cash | 8,185 | ||||||||||||||||
Accounts receivable | 6,451 | ||||||||||||||||
Other current assets | 3,241 | ||||||||||||||||
Property, plant and equipment | 100,892 | ||||||||||||||||
Intangible assets | 10,590 | ||||||||||||||||
Other Assets | 3,464 | ||||||||||||||||
Accounts payable and accrued liabilities | (16,051) | ||||||||||||||||
Advance payments and deposits | (6,683) | ||||||||||||||||
Current debt | (6,429) | ||||||||||||||||
Long-term debt | (28,929) | ||||||||||||||||
Net assets acquired | 74,731 | ||||||||||||||||
Gain on KeyTech bargain purchase | 7,304 | ||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Revenue | 55,500 | ||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes | 2,800 | ||||||||||||||||
Transaction related charges relating to legal, accounting and consulting services. | 4,300 | ||||||||||||||||
Transaction related charges | 3,400 | ||||||||||||||||
One Communications (formerly KeyTech) and BDC | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Total consideration | 41,563 | ||||||||||||||||
Total value to allocate | |||||||||||||||||
Business Combination Total Value Allocation | $ 74,472 | ||||||||||||||||
Innovative | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Total consideration | $ 111,860 | ||||||||||||||||
Cash-on-hand used to fund the purchase price | 51,900 | ||||||||||||||||
Pension funding required by Innovative acquisition | 22,500 | ||||||||||||||||
Purchase price reduction | 400 | ||||||||||||||||
Restricted cash | 5,300 | ||||||||||||||||
Purchase price | 145,000 | ||||||||||||||||
Purchase price adjustments | 5,300 | ||||||||||||||||
Total value to allocate | |||||||||||||||||
Non-controlling interests | 221 | ||||||||||||||||
Business Combination Total Value Allocation | 112,081 | ||||||||||||||||
Purchase price allocation: | |||||||||||||||||
Cash | 4,229 | ||||||||||||||||
Accounts receivable | 6,553 | ||||||||||||||||
Materials & supplies | 6,533 | ||||||||||||||||
Other current assets | 1,927 | ||||||||||||||||
Property, plant and equipment | 108,284 | ||||||||||||||||
Telecommunication licenses | 7,623 | ||||||||||||||||
Goodwill | 20,586 | ||||||||||||||||
Intangible assets | 7,800 | ||||||||||||||||
Other Assets | 4,394 | ||||||||||||||||
Accounts payable and accrued liabilities | (15,971) | ||||||||||||||||
Advance payments and deposits | (7,793) | ||||||||||||||||
Deferred tax liability | (2,935) | ||||||||||||||||
Pension liability | (29,149) | ||||||||||||||||
Net assets acquired | 112,081 | ||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Revenue | 53,000 | ||||||||||||||||
Income (Loss) from Continuing Operations before Income Taxes | 1,500 | ||||||||||||||||
Transaction related charges relating to legal, accounting and consulting services. | 4,100 | ||||||||||||||||
Transaction related charges | 2,200 | ||||||||||||||||
Innovative | Pension Benefit | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Pension funding required by Innovative acquisition | 22,500 | ||||||||||||||||
Innovative | Postretirement Benefits | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Cash-on-hand used to fund the purchase price | 27,800 | ||||||||||||||||
Payments for acquisition other postretirement benefit unfunded | 5,100 | ||||||||||||||||
Innovative | Term loans | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Cash consideration | 51,000 | ||||||||||||||||
Debt instrument, face amount | $ 60,000 | ||||||||||||||||
Telecommunication Equipment | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Discounted rate used for cash flows | 15.00% | ||||||||||||||||
US Telecom | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Cash consideration | $ 9,100 | ||||||||||||||||
Purchase price allocation: | |||||||||||||||||
Property, plant and equipment | 10,200 | ||||||||||||||||
Goodwill | 3,100 | ||||||||||||||||
Deferred tax liability | (3,500) | ||||||||||||||||
Other long term liabilities | 700 | ||||||||||||||||
Increase in goodwill | 2,700 | ||||||||||||||||
Increase in deferred tax liabilities | $ 2,700 | ||||||||||||||||
Vibrant Energy | |||||||||||||||||
Consideration Transferred | |||||||||||||||||
Cash consideration | $ 3,500 | ||||||||||||||||
Total consideration | 6,193 | ||||||||||||||||
Purchase price allocation: | |||||||||||||||||
Cash | 136 | ||||||||||||||||
Prepayments and other assets | 636 | ||||||||||||||||
Property, plant and equipment | 7,321 | ||||||||||||||||
Goodwill | 3,279 | ||||||||||||||||
Accounts payable and accrued liabilities | (5,179) | ||||||||||||||||
Net assets acquired | 6,193 | ||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Contingent Consideration | 2,700 | ||||||||||||||||
Revenue | 400 | ||||||||||||||||
Transaction related charges relating to legal, accounting and consulting services. | $ 11,400 | ||||||||||||||||
Transaction related charges | $ 10,100 | ||||||||||||||||
Minimum | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Useful life | 3 years | ||||||||||||||||
Minimum | Innovative Pension Benefit | |||||||||||||||||
Goodwill | |||||||||||||||||
Discount rate (as a percent) | 3.60% | ||||||||||||||||
Minimum | Innovative | Income Approach | Non-Controlling Interests | |||||||||||||||||
Goodwill | |||||||||||||||||
Discount rate (as a percent) | 15.00% | ||||||||||||||||
Minimum | Innovative | Income Approach | Designated as cash flow hedges | |||||||||||||||||
Goodwill | |||||||||||||||||
Discount rate (as a percent) | 14.00% | ||||||||||||||||
Minimum | Telecommunication Equipment | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Useful life | 1 year | 3 years | |||||||||||||||
Minimum | Telecommunication Equipment | Customer relationships | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Useful life | 7 years | 9 years | |||||||||||||||
Maximum | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Useful life | 39 years | ||||||||||||||||
Maximum | Innovative Pension Benefit | |||||||||||||||||
Goodwill | |||||||||||||||||
Discount rate (as a percent) | 3.90% | ||||||||||||||||
Maximum | Innovative | Income Approach | Non-Controlling Interests | |||||||||||||||||
Goodwill | |||||||||||||||||
Discount rate (as a percent) | 25.00% | ||||||||||||||||
Maximum | Innovative | Income Approach | Designated as cash flow hedges | |||||||||||||||||
Goodwill | |||||||||||||||||
Discount rate (as a percent) | 25.00% | ||||||||||||||||
Maximum | Telecommunication Equipment | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Useful life | 18 years | 18 years | |||||||||||||||
Maximum | Telecommunication Equipment | Customer relationships | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Useful life | 13 years | 12 years | |||||||||||||||
International Telecom | |||||||||||||||||
Purchase price allocation: | |||||||||||||||||
Goodwill | $ 24,326 | $ 5,438 | $ 24,326 | $ 5,438 | $ 5,438 | ||||||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | International Telecom | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Deconsolidation of non-controlling interests | $ 20,000 | ||||||||||||||||
Deconsolidation, Revaluation of Retained Investment, Gain (Loss), Amount | 100 | ||||||||||||||||
Nonoperating Income (Expense) | Disposal Group, Disposed of by Sale, Not Discontinued Operations | International Telecom | |||||||||||||||||
Purchase price allocation BDC: | |||||||||||||||||
Loss on deconsolidation of subsidiary | $ 19,900 |
ACQUISITIONS AND DISPOSITIONS55
ACQUISITIONS AND DISPOSITIONS - Pro Forma Results (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 01, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Pro forma | |||
Acquisitions | |||
Impairment charges | $ 5,400 | $ 168,700 | |
Pro Forma | |||
Revenue | 535,628 | 546,589 | |
Net income (loss) attributable to ATN International, Inc. Stockholders | $ 14,660 | $ (97,102) | |
Earnings per share: Basic (in dollars per share) | $ 0.91 | $ (6.06) | |
Earnings per share: Diluted (in dollars per share) | $ 0.90 | $ (6.02) | |
As reported | |||
Pro Forma | |||
Revenue | $ 457,003 | $ 355,369 | |
Net income (loss) attributable to ATN International, Inc. Stockholders | $ 12,101 | $ 16,940 | |
Earnings per share: Basic (in dollars per share) | $ 0.75 | $ 1.06 | |
Earnings per share: Diluted (in dollars per share) | $ 0.75 | $ 1.05 | |
One Communications (formerly KeyTech) | |||
Acquisitions | |||
Retirement of debt | $ 24,700 | ||
One Communications (formerly KeyTech) | Pro forma | |||
Acquisitions | |||
Impairment charges | 4,300 | $ 85,600 | |
Innovative | |||
Acquisitions | |||
Retirement of debt | 185,800 | ||
Addition of debt | $ 60,000 | ||
Innovative | Pro forma | |||
Acquisitions | |||
Impairment charges | $ 1,100 | $ 83,100 |
DISCONTINUED OPERATIONS - SAL56
DISCONTINUED OPERATIONS - SALE OF U.S. RETAIL WIRELESS BUSINESS (Details) - Alltel Sale - AT&T Mobility - USD ($) $ in Millions | Sep. 20, 2013 | Dec. 31, 2015 | Dec. 31, 2014 |
Liabilities sold: | |||
Additional gain (loss) on sale of assets | $ 1.1 | $ 1.1 | |
Alltel Wireless | |||
SALE OF U.S. RETAIL WIRELESS BUSINESS | |||
Consideration for sale of operations in all-cash transaction | $ 780 | ||
Proceeds: | |||
Working capital | $ 16.8 |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
ACCOUNTS RECEIVABLE | ||
Accounts receivable | $ 58,568 | $ 48,314 |
Less: allowance for doubtful accounts | (13,149) | (9,294) |
Total accounts receivable, net | 45,419 | 39,020 |
U.S. wireless, Retail | ||
ACCOUNTS RECEIVABLE | ||
Accounts receivable | 36,026 | 23,805 |
U.S. wireless, Wholesale | ||
ACCOUNTS RECEIVABLE | ||
Accounts receivable | 22,502 | 24,341 |
Other | ||
ACCOUNTS RECEIVABLE | ||
Accounts receivable | $ 40 | $ 168 |
FIXED ASSETS (Details)
FIXED ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Fixed Assets | |||
Total plant in service | $ 1,036,370 | $ 766,144 | |
Total property, plant, and equipment | 1,138,362 | 807,247 | |
Less: Accumulated depreciation | (490,650) | (433,744) | |
Net fixed assets | 647,712 | 373,503 | |
Depreciation and amortization | 73,300 | 55,900 | $ 50,300 |
Gain on disposition of long-lived assets | (27) | 2,823 | |
Capital expenditures offset by grants | $ 2,300 | 2,600 | $ 2,300 |
U.S. Telecom | |||
Fixed Assets | |||
Gain on disposition of long-lived assets | 2,800 | ||
Minimum | |||
Fixed Assets | |||
Useful Life | 3 years | ||
Maximum | |||
Fixed Assets | |||
Useful Life | 39 years | ||
Telecommunications equipment and towers | |||
Fixed Assets | |||
Total plant in service | $ 802,415 | 553,237 | |
Capital leased assets, cost | 13,800 | 2,700 | |
Capital leased assets, net | $ 12,400 | $ 1,800 | |
Telecommunications equipment and towers | Minimum | |||
Fixed Assets | |||
Useful Life | 5 years | 5 years | |
Telecommunications equipment and towers | Maximum | |||
Fixed Assets | |||
Useful Life | 15 years | 15 years | |
Solar assets | |||
Fixed Assets | |||
Total plant in service | $ 115,932 | $ 111,446 | |
Solar assets | Minimum | |||
Fixed Assets | |||
Useful Life | 20 years | 20 years | |
Solar assets | Maximum | |||
Fixed Assets | |||
Useful Life | 23 years | 23 years | |
Office and computer equipment | |||
Fixed Assets | |||
Total plant in service | $ 44,147 | $ 54,665 | |
Office and computer equipment | Minimum | |||
Fixed Assets | |||
Useful Life | 3 years | 3 years | |
Office and computer equipment | Maximum | |||
Fixed Assets | |||
Useful Life | 10 years | 10 years | |
Buildings | |||
Fixed Assets | |||
Total plant in service | $ 43,609 | $ 18,540 | |
Buildings | Minimum | |||
Fixed Assets | |||
Useful Life | 15 years | 15 years | |
Buildings | Maximum | |||
Fixed Assets | |||
Useful Life | 39 years | 39 years | |
Transportation vehicles | |||
Fixed Assets | |||
Total plant in service | $ 12,043 | $ 8,882 | |
Transportation vehicles | Minimum | |||
Fixed Assets | |||
Useful Life | 3 years | 3 years | |
Transportation vehicles | Maximum | |||
Fixed Assets | |||
Useful Life | 10 years | 10 years | |
Leasehold improvements | |||
Fixed Assets | |||
Total plant in service | $ 325 | $ 11,592 | |
Land | |||
Fixed Assets | |||
Total plant in service | 10,242 | 1,198 | |
Furniture and fixtures | |||
Fixed Assets | |||
Total plant in service | $ 7,657 | $ 6,584 | |
Furniture and fixtures | Minimum | |||
Fixed Assets | |||
Useful Life | 5 years | 5 years | |
Furniture and fixtures | Maximum | |||
Fixed Assets | |||
Useful Life | 10 years | 10 years | |
Construction in progress | |||
Fixed Assets | |||
Total property, plant, and equipment | $ 101,992 | $ 41,103 | |
Assets Held under Capital Leases [Member] | |||
Fixed Assets | |||
Capital Leased Assets, Remaining amount due | $ 1,200 | $ 0 |
GOODWILL AND INTANGIBLE ASSET59
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | 24 Months Ended |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill | ||
Impairment of long-lived assets | $ 3,600 | |
Goodwill impairment | $ 7,491 | |
Discount rate (as a percent) | 14.00% | |
Non-cash impairment charges | $ 11,425 | |
Changes in the carrying amounts of goodwill | $ 0 | |
U.S. Telecom | ||
Goodwill | ||
Goodwill impairment | $ 7,491 |
GOODWILL AND INTANGIBLE ASSET60
GOODWILL AND INTANGIBLE ASSETS - Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | 24 Months Ended |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Roll Forward] | ||
Changes in the carrying amounts of goodwill | $ 0 | |
Balance at the beginning of the period | $ 45,077 | |
Acquisitions | 26,986 | |
Deconsolidation of Subsidiary | (1,698) | |
Impairment charge | (7,491) | |
Goodwill, Gross | 70,364 | |
Accumulated impairment | (7,491) | |
Balance at the end of the period | 62,873 | 45,077 |
U.S. Telecom | ||
Goodwill [Roll Forward] | ||
Balance at the beginning of the period | 39,639 | |
Acquisitions | 3,121 | |
Impairment charge | (7,491) | |
Goodwill, Gross | 42,759 | |
Accumulated impairment | (7,491) | |
Balance at the end of the period | 35,268 | 39,639 |
International Telecom | ||
Goodwill [Roll Forward] | ||
Balance at the beginning of the period | 5,438 | |
Acquisitions | 20,586 | |
Deconsolidation of Subsidiary | (1,698) | |
Goodwill, Gross | 24,326 | |
Balance at the end of the period | 24,326 | $ 5,438 |
Renewable energy | ||
Goodwill [Roll Forward] | ||
Acquisitions | 3,279 | |
Goodwill, Gross | 3,279 | |
Balance at the end of the period | $ 3,279 |
GOODWILL AND INTANGIBLE ASSET61
GOODWILL AND INTANGIBLE ASSETS - Change In Carrying Amount Of Telecommunications Licenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Telecommunications licenses | ||
Impairment of intangible assets | $ 0 | $ 0 |
Changes in the carrying amount of the company's telecommunications licenses, by operating segment | ||
Balance at the beginning of the period | 43,468 | |
Balance at the end of the period | 48,291 | 43,468 |
Telecommunications Licenses | ||
Telecommunications licenses | ||
Impairment of intangible assets | 0 | 0 |
Changes in the carrying amount of the company's telecommunications licenses, by operating segment | ||
Balance at the beginning of the period | 43,468 | 44,090 |
Deconsolidation of subsidiary | (2,178) | |
Acquired licenses | 7,623 | |
Amortization | (622) | (622) |
Balance at the end of the period | 48,291 | 43,468 |
Telecommunications Licenses | U.S. Telecom | ||
Changes in the carrying amount of the company's telecommunications licenses, by operating segment | ||
Balance at the beginning of the period | 24,944 | 24,944 |
Balance at the end of the period | 24,944 | 24,944 |
Telecommunications Licenses | International Telecom | ||
Changes in the carrying amount of the company's telecommunications licenses, by operating segment | ||
Balance at the beginning of the period | 18,524 | 19,146 |
Deconsolidation of subsidiary | (2,178) | |
Acquired licenses | 7,623 | |
Amortization | (622) | (622) |
Balance at the end of the period | $ 23,347 | $ 18,524 |
GOODWILL AND INTANGIBLE ASSET62
GOODWILL AND INTANGIBLE ASSETS - Customer Relationships (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-lived intangible assets | |||
Impairment of other intangibles | $ 300 | ||
U.S. Telecom | |||
Finite-lived intangible assets | |||
Other intangible assets | 4,900 | ||
Customer relationships | |||
Finite-lived intangible assets | |||
Amortization | 2,000 | $ 400 | $ 300 |
Customer relationships | International Telecom | |||
Future Amortization | |||
2,017 | 3,281 | ||
2,018 | 2,411 | ||
2,019 | 1,897 | ||
2,020 | 1,528 | ||
2,021 | 1,300 | ||
Thereafter | 4,612 | ||
Total | 15,029 | ||
Franchise Rights | U.S. Telecom | |||
Finite-lived intangible assets | |||
Other intangible assets | 3,000 | ||
Trade names | U.S. Telecom | |||
Finite-lived intangible assets | |||
Other intangible assets | $ 1,900 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Jul. 01, 2016 | May 03, 2016 | Dec. 31, 2016 | Dec. 19, 2016 | Jan. 11, 2016 | Jan. 10, 2016 | Dec. 24, 2014 | Dec. 19, 2014 |
Amended Credit Facility | ||||||||
Long-term debt | ||||||||
Maximum borrowing capacity | $ 400,000 | $ 275,000 | ||||||
Revolving credit facility | Amended Credit Facility | ||||||||
Long-term debt | ||||||||
Maximum borrowing capacity | 200,000 | $ 225,000 | ||||||
Revolving credit facility | Amended Credit Facility | Minimum | ||||||||
Long-term debt | ||||||||
Commitment fee (as a percent) | 0.175% | |||||||
Revolving credit facility | Amended Credit Facility | Minimum | LIBOR | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 1.50% | |||||||
Revolving credit facility | Amended Credit Facility | Minimum | Base rate | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 0.50% | |||||||
Revolving credit facility | Amended Credit Facility | Maximum | ||||||||
Long-term debt | ||||||||
Commitment fee (as a percent) | 0.25% | |||||||
Revolving credit facility | Amended Credit Facility | Maximum | LIBOR | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 1.75% | |||||||
Revolving credit facility | Amended Credit Facility | Maximum | Base rate | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 0.75% | |||||||
Letter of credit sub-facility | ||||||||
Long-term debt | ||||||||
Borrowings | $ 0 | |||||||
Outstanding letters of credit | 10,600 | |||||||
Letter of credit sub-facility | Amended Credit Facility | ||||||||
Long-term debt | ||||||||
Maximum borrowing capacity | 10,000 | |||||||
Letter of credit sub-facility | Amended Credit Facility | Wholesale Mobility Funds | ||||||||
Long-term debt | ||||||||
Maximum borrowing capacity | 25,000 | |||||||
Letter of credit sub-facility | Credit facility | ||||||||
Long-term debt | ||||||||
Borrowings | $ 0 | |||||||
Swingline sub-facility | Amended Credit Facility | ||||||||
Long-term debt | ||||||||
Maximum borrowing capacity | $ 10,000 | |||||||
Swingline sub-facility | Amended Credit Facility | Federal Funds Effective Rate | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 0.50% | |||||||
Swingline sub-facility | Amended Credit Facility | Minimum | Base rate | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 1.00% | |||||||
Ahana Debt | ||||||||
Long-term debt | ||||||||
Outstanding debt | $ 2,500 | |||||||
Ahana Debt | Series A Notes | ||||||||
Long-term debt | ||||||||
Secured debt principal amount | $ 20,600 | |||||||
Stated interest rate | 4.427% | |||||||
Ahana Debt | Series B Notes | ||||||||
Long-term debt | ||||||||
Secured debt principal amount | $ 45,200 | |||||||
Effective interest rate (as a percent) | 5.327% | |||||||
Ahana Debt | Series A and Series B Notes | ||||||||
Long-term debt | ||||||||
Outstanding debt | $ 65,800 | |||||||
Ahana Debt | Term loans | ||||||||
Long-term debt | ||||||||
Term loan assumed | $ 38,900 | |||||||
Ahana Debt | Term loans | Minimum | ||||||||
Long-term debt | ||||||||
Effective interest rate (as a percent) | 4.50% | |||||||
Ahana Debt | Term loans | Maximum | ||||||||
Long-term debt | ||||||||
Effective interest rate (as a percent) | 6.00% | |||||||
PSE&G | Term loans | ||||||||
Long-term debt | ||||||||
Stated interest rate | 11.30% | |||||||
One Communications (formerly KeyTech) | ||||||||
Long-term debt | ||||||||
Cash consideration | $ 34,518 | |||||||
One Communications (formerly KeyTech) | Minimum | ||||||||
Long-term debt | ||||||||
Potential cash dividend | 13,000 | |||||||
One Communications (formerly KeyTech) | Amended Credit Facility | ||||||||
Long-term debt | ||||||||
Secured debt principal amount | $ 60,000 | |||||||
One Communications (formerly KeyTech) | Term loans | ||||||||
Long-term debt | ||||||||
Term loan assumed | $ 35,400 | |||||||
Outstanding debt | $ 32,100 | |||||||
One Communications (formerly KeyTech) | Term loans | Three month LIBOR | ||||||||
Long-term debt | ||||||||
Basis spread on variable rate (as a percent) | 3.25% | |||||||
Description of variable rate basis | three-month LIBOR | |||||||
Innovative | Term loans | ||||||||
Long-term debt | ||||||||
Secured debt principal amount | $ 60,000 | |||||||
Stated interest rate | 4.00% | |||||||
Outstanding debt | 60,000 | |||||||
Finance costs to lock in rate | $ 900 | |||||||
Deferred finance costs, net | $ 800 | |||||||
Cash consideration | $ 51,000 |
GOVERNMENT GRANTS (Details)
GOVERNMENT GRANTS (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2014 | Aug. 31, 2013 | Dec. 31, 2016 | |
MOBILITY FUND GRANTS | |||
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 | ||
Wholesale Mobility Funds | |||
MOBILITY FUND GRANTS | |||
Mobility Funds approved by FCC | $ 2.4 | $ 21.7 | |
Wholesale Mobility Funds | U.S. Telecom | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | 19.7 | ||
Mobility funds received and recorded to date | 4.6 | ||
Wholesale Mobility Funds | U.S. Telecom | Operating Expenses | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | 13.9 | ||
Wholesale Mobility Funds | U.S. Telecom | Property, Plant and Equipment [Member] | |||
MOBILITY FUND GRANTS | |||
Grant funds used to offset fixed asset related costs | 5.8 | ||
Wholesale Mobility Funds | U.S. Telecom | Other current liabilities | |||
MOBILITY FUND GRANTS | |||
Grant funds used to offset fixed asset related costs | 5.8 | ||
Wholesale Mobility Funds | U.S. Telecom | Other long-term liabilities | |||
MOBILITY FUND GRANTS | |||
Mobility Funds received | $ 3.4 |
EQUITY (Details)
EQUITY (Details) - USD ($) | 12 Months Ended | 145 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Sep. 18, 2016 | Sep. 19, 2016 | Sep. 30, 2004 | |
Stock-based compensation | ||||||
Number of shares reserved to be granted under the plan | 2,000,000 | |||||
Number of Options | ||||||
Exercised (in shares) | (43,053) | (87,378) | (43,034) | |||
Treasury Stock | ||||||
Shares Repurchased | 70,686 | 37,567 | 34,293 | |||
Aggregate Cost | $ 4,873,000 | $ 2,705,000 | $ 2,160,000 | |||
Aggregate cost to satisfy tax withholdings and exercise obligations | $ 2,775,000 | $ 2,705,000 | $ 2,160,000 | |||
Shares repurchased to satisfy tax withholdings and exercise obligations | 38,279 | 37,567 | 34,293 | |||
Average Repurchase Price (in dollars per share) | $ 72.50 | $ 72.01 | $ 63.01 | |||
2004 Repurchase Plan | ||||||
Treasury Stock | ||||||
Authorized amount | $ 5,000,000 | |||||
Shares Repurchased | 4,100,000 | |||||
2016 Repurchase Plan | ||||||
Treasury Stock | ||||||
Authorized amount | $ 50,000,000 | |||||
Value of shares available for repurchase | $ 49,900,000 | |||||
2004 and 2016 Repurchase Plan | ||||||
Treasury Stock | ||||||
Shares Repurchased | 32,407 | |||||
Aggregate Cost | $ 2,195,000 | |||||
Average Repurchase Price (in dollars per share) | $ 64.72 | |||||
Stock options | ||||||
Stock-based compensation | ||||||
Expiration term | 10 years | |||||
Vesting period | 4 years | |||||
Number of Options | ||||||
Outstanding at the beginning of the period (in shares) | 268,875 | 351,253 | ||||
Granted (in shares) | 5,000 | |||||
Exercised (in shares) | (43,053) | (87,378) | ||||
Outstanding at the end of the period (in shares) | 225,822 | 268,875 | 351,253 | |||
Vested and expected to vest at the end of the period (in shares) | 225,554 | 268,011 | ||||
Exercisable at the end of the period (in shares) | 222,072 | 248,875 | ||||
Weighted Avg. Exercise Price | ||||||
Outstanding at the beginning of the period (in dollars per share) | $ 38.64 | $ 36.55 | ||||
Granted (in dollars per share) | 71.43 | |||||
Exercised (in dollars per share) | 32.70 | 32.14 | ||||
Outstanding at the end of the period (in dollars per share) | 39.77 | 38.64 | $ 36.55 | |||
Vested and expected to vest at the end of the period (in dollars per share) | 39.73 | 38.53 | ||||
Exercisable at the end of the period (in dollars per share) | $ 39.23 | $ 38.05 | ||||
Weighted Average Remaining Contractual Term | ||||||
Outstanding | 3 years 10 months 24 days | 4 years 8 months 12 days | ||||
Vested and expected to vest | 3 years 10 months 24 days | 4 years 8 months 12 days | ||||
Exercisable | 3 years 9 months 18 days | 4 years 6 months | ||||
Aggregate Intrinsic Value | ||||||
Outstanding | $ 9,114,963 | $ 10,646,006 | ||||
Vested and expected to vest | 9,112,630 | 10,640,134 | ||||
Exercisable | 9,082,338 | $ 9,998,956 | ||||
Unamortized stock based compensation | ||||||
Unamortized stock based compensation | $ 100,000 | |||||
Weighted-average period for recognition of unamortized stock-based compensation cost | 2 years 7 months 6 days | |||||
Stock-based compensation, additional disclosures | ||||||
Weighted-average fair value of options granted (in dollars per share) | $ 30.70 | |||||
Aggregate intrinsic value of options exercised | $ 1,591,000 | $ 3,488,000 | $ 1,098,000 | |||
Cash proceeds received upon exercise of options | 1,060,000 | 1,999,000 | 1,621,000 | |||
Excess tax benefits from share-based compensation | $ 591,000 | 1,423,000 | 513,000 | |||
Weighted-average assumptions using Black-Scholes option-pricing model for estimating fair value of each option granted | ||||||
Risk-free interest rate (as a percent) | 1.55% | |||||
Expected dividend yield (as a percent) | 1.76% | |||||
Expected life | 6 years 3 months | |||||
Expected volatility (as a percent) | 51.85% | |||||
Stock compensation expense | ||||||
Stock compensation expense | $ 100,000 | 900,000 | 1,400,000 | |||
Restricted Stock | ||||||
Stock-based compensation | ||||||
Vesting period | 4 years | |||||
Unamortized stock based compensation | ||||||
Unamortized stock based compensation | $ 11,200,000 | |||||
Weighted-average period for recognition of unamortized stock-based compensation cost | 2 years 6 months | |||||
Stock compensation expense | ||||||
Stock compensation expense | $ 6,200,000 | $ 4,300,000 | $ 3,400,000 | |||
Shares | ||||||
Unvested at the beginning of the period (in shares) | 218,401 | 195,143 | ||||
Granted (in shares) | 100,005 | 93,864 | 109,318 | |||
Forfeited (in shares) | (1,125) | (1,687) | ||||
Vested and issued (in shares) | (88,241) | (68,919) | ||||
Unvested at the end of the period (in shares) | 229,040 | 218,401 | 195,143 | |||
Weighted Avg. Fair Value | ||||||
Unvested at the beginning of the period (in dollars per share) | $ 60.60 | $ 55.13 | ||||
Granted (in dollars per share) | 73.34 | 66.26 | ||||
Forfeited (in dollars per share) | 66.44 | 65.18 | ||||
Vested and issued (in dollars per share) | 58.01 | 52.70 | ||||
Unvested at the end of the period (in dollars per share) | $ 67.13 | $ 60.60 | $ 55.13 | |||
2008 Plan | Restricted Stock | ||||||
Stock-based compensation | ||||||
Vesting period | 4 years |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Before Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Components of income before income taxes | |||||||||||
Domestic | $ 28,047 | $ 50,563 | $ 57,767 | ||||||||
Foreign | 17,327 | 5,638 | 28,401 | ||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | $ 7,590 | $ 21,296 | $ 1,059 | $ 15,429 | $ 7,763 | $ 21,782 | $ 28,026 | $ (1,370) | $ 45,374 | $ 56,201 | $ 86,168 |
INCOME TAXES - Income Tax Recon
INCOME TAXES - Income Tax Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation from the tax computed at statutory income tax rates to the Company's income tax expense | |||||||||||
Tax computed at statutory U.S. federal income tax rates | $ 15,782 | $ 19,652 | $ 30,160 | ||||||||
Non-controlling interest | (2,893) | (2,807) | (1,229) | ||||||||
Foreign tax rate differential | (3,074) | 1,659 | (5,757) | ||||||||
Over (under) provided in prior periods | 1,069 | 652 | (401) | ||||||||
Nondeductible expenses | 1,134 | 1,113 | 757 | ||||||||
Goodwill Impairment | 2,622 | ||||||||||
Capitalized transactions costs | 3,138 | ||||||||||
Change in tax reserves | 2,561 | 2,564 | 2,153 | ||||||||
State Taxes, net of federal benefit | 1,853 | 935 | 1,252 | ||||||||
Change in valuation allowance | (7,292) | (5,949) | (2,549) | ||||||||
Foreign tax credit expiration | 4,179 | 6,396 | 2,999 | ||||||||
Other, net | 2,081 | (78) | 763 | ||||||||
Total Income Tax Expense | $ 3,982 | $ 9,602 | $ 2,945 | $ 4,631 | $ 1,482 | $ 10,134 | $ 13,008 | $ (487) | $ 21,160 | $ 24,137 | $ 28,148 |
INCOME TAXES - Components Of 68
INCOME TAXES - Components Of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | |||||||||||
United States-Federal | $ 15,763 | $ (1,308) | $ 14,761 | ||||||||
United States-State | 505 | (383) | 1,347 | ||||||||
Foreign | 10,528 | 7,959 | 12,153 | ||||||||
Total current income tax expense | 26,796 | 6,268 | 28,261 | ||||||||
Deferred: | |||||||||||
United States-Federal | (1,880) | 16,760 | 5,205 | ||||||||
United States-State | (291) | 1,636 | 466 | ||||||||
Foreign | (3,465) | (527) | (5,784) | ||||||||
Total deferred income tax expense (benefit) | (5,636) | 17,869 | (113) | ||||||||
Consolidated: | |||||||||||
United States-Federal | 13,883 | 15,452 | 19,966 | ||||||||
United States-State | 214 | 1,253 | 1,813 | ||||||||
Foreign | 7,063 | 7,432 | 6,369 | ||||||||
Total Income Tax Expense | $ 3,982 | $ 9,602 | $ 2,945 | $ 4,631 | $ 1,482 | $ 10,134 | $ 13,008 | $ (487) | 21,160 | 24,137 | $ 28,148 |
Deferred tax assets: | |||||||||||
Receivables reserve | 1,470 | 702 | 1,470 | 702 | |||||||
Temporary differences not currently deductible for tax | 8,918 | 7,236 | 8,918 | 7,236 | |||||||
Deferred compensation | 2,461 | 2,135 | 2,461 | 2,135 | |||||||
Foreign tax credit carryforwards | 4,180 | 4,180 | |||||||||
Pension | 1,085 | 1,153 | 1,085 | 1,153 | |||||||
Net operating losses | 29,571 | 4,463 | 29,571 | 4,463 | |||||||
Total deferred tax asset | 43,505 | 19,869 | 43,505 | 19,869 | |||||||
Deferred tax liabilities: | |||||||||||
Property, plant and equipment, net | 41,136 | 43,718 | 41,136 | 43,718 | |||||||
Intangible assets, net | 6,122 | 13,743 | 6,122 | 13,743 | |||||||
Total deferred tax liabilities | 47,258 | 57,461 | 47,258 | 57,461 | |||||||
Valuation allowance | (42,462) | (7,814) | (42,462) | (7,814) | |||||||
Net deferred tax liabilities | (46,215) | (45,406) | (46,215) | (45,406) | |||||||
Deferred tax assets: | |||||||||||
Long term and total deferred tax asset | 407 | 407 | |||||||||
Deferred tax liabilities: | |||||||||||
Long term and total deferred tax liabilities | (46,622) | (45,406) | (46,622) | (45,406) | |||||||
Net deferred tax liabilities | (46,215) | (45,406) | $ (46,215) | (45,406) | |||||||
Period of cumulative loss | 3 years | ||||||||||
Operating loss carryforward that will expire | 83,500 | $ 83,500 | |||||||||
Operating loss carryforward with no expiration | 3,400 | 3,400 | |||||||||
Federal | |||||||||||
Deferred tax liabilities: | |||||||||||
Operating loss carryforwards | 3,300 | 3,300 | |||||||||
State | |||||||||||
Deferred tax liabilities: | |||||||||||
Operating loss carryforwards | 8,900 | 8,900 | |||||||||
NOL carryforward valuation allowance | 500 | 2,000 | 500 | 2,000 | |||||||
Foreign | |||||||||||
Deferred tax assets: | |||||||||||
Tax Credits | 4,100 | 4,100 | |||||||||
Deferred tax liabilities: | |||||||||||
Operating loss carryforwards | 74,700 | 74,700 | |||||||||
NOL carryforward valuation allowance | 27,800 | $ 1,700 | 27,800 | $ 1,700 | |||||||
Valuation allowance established as part of purchase accounting | 41,900 | 41,900 | |||||||||
Remaining valuation allowance applied to other foreign deferred taxes | 14,100 | 14,100 | |||||||||
Undistributed earnings of foreign subsidiaries considered indefinitely reinvested | $ 288,600 | $ 288,600 |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Activity related to unrecognized tax benefits | |||
Unrecognized benefits, including interest and penalties | $ 20,000 | $ 18,900 | $ 16,500 |
Increase from prior period positions | 1,400 | ||
Settlement of prior year positions | 800 | ||
Decrease from lapse in statue of limitations | 1,800 | ||
Gross unrecognized tax benefits at the beginning of the period | 17,216 | 15,499 | 14,050 |
Increase in unrecognized tax benefits taken during a prior period | 561 | 177 | |
Increase in unrecognized tax benefits taken during the current period | 2,321 | 1,717 | 1,498 |
Lapse in statute of limitations | (1,673) | (226) | |
Settlements | (521) | ||
Gross unrecognized tax benefits at the end of the period | 17,904 | 17,216 | 15,499 |
Interest and penalties accrued | 2,100 | $ 1,700 | $ 1,000 |
Unrecognized tax benefits that would affect the effective tax rate if recognized | $ 20,000 |
RETIREMENT PLANS (Details)
RETIREMENT PLANS (Details) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Pension Benefit | ||||||
Retirement plans | ||||||
Employment period or credited service period for which participants' average salary or hourly wages is used as a base to calculate benefits | 3 years | |||||
Weighted-average rates assumed in the actuarial calculations for the pension plan | ||||||
Discount rate (as a percent) | 4.30% | 5.80% | 5.80% | |||
Annual salary increase (as a percent) | 6.50% | 6.50% | 6.50% | |||
Expected long-term return on plan assets (as a percent) | 6.30% | 6.50% | 7.00% | |||
Projected benefit obligations: | ||||||
Balance at beginning of year | $ 14,400,000 | $ 14,093,000 | ||||
Innovative acquisition | 69,178,000 | |||||
Service cost | 1,308,000 | 652,000 | $ 612,000 | |||
Interest cost | 2,002,000 | 766,000 | 720,000 | |||
Curtailment | 128,000 | |||||
Benefits and settlements paid | (6,445,000) | (1,329,000) | ||||
Actuarial (gain) loss | (4,437,000) | 218,000 | ||||
Experience Loss | (15,000) | |||||
Balance at end of year | 76,119,000 | 14,400,000 | 14,093,000 | |||
Plan net assets: | ||||||
Balance at beginning of year | 11,946,000 | 13,165,000 | ||||
Innovative acquisition | 45,116,000 | |||||
Actual return on plan assets | 1,717,000 | 110,000 | ||||
Company contributions | 22,963,000 | |||||
Benefits and settlements paid | (6,411,000) | (1,329,000) | ||||
Balance at end of year | 75,331,000 | 11,946,000 | 13,165,000 | |||
Funded status of plan | ||||||
Projected benefit obligation | 14,400,000 | 14,093,000 | 14,093,000 | $ 76,119,000 | $ 14,400,000 | $ 14,093,000 |
Under funded status of plan | (788,000) | (2,454,000) | ||||
Pension plan assets | ||||||
Fair value of plan assets | 11,946,000 | 13,165,000 | 13,165,000 | $ 75,331,000 | $ 11,946,000 | $ 13,165,000 |
Weighted-average asset allocations (as a percent) | 100.00% | 100.00% | ||||
Amounts recognized on the consolidated balance sheets | ||||||
Other Liabilities | $ 3,894,000 | $ 2,454,000 | ||||
Other Assets | 3,105,000 | |||||
Accumulated other comprehensive income / (loss), net of tax | 1,418,000 | (3,481,000) | ||||
Amounts recognized in accumulated other comprehensive loss | ||||||
Net actuarial gain/(loss) | (386,000) | (5,836,000) | ||||
Accumulated other comprehensive loss, pre-tax | (386,000) | (5,836,000) | ||||
Accumulated other comprehensive income / (loss), net of tax | 1,418,000 | $ (3,481,000) | ||||
Components of the plan's net periodic pension cost | ||||||
Service cost | 1,308,000 | 652,000 | 612,000 | |||
Interest cost | 2,002,000 | 766,000 | 720,000 | |||
Expected return on plan assets | (2,024,000) | (813,000) | (848,000) | |||
Amortization of unrecognized net actuarial loss | 1,271,000 | 245,000 | 218,000 | |||
Curtailment | 128,000 | |||||
Net periodic pension cost | 2,685,000 | 850,000 | $ 702,000 | |||
Additional disclosure | ||||||
Expected contribution in 2017 | 833,000 | |||||
Estimated Pension Benefits | ||||||
2,017 | 4,433,000 | |||||
2,018 | 4,001,000 | |||||
2,019 | 4,348,000 | |||||
2,020 | 4,461,000 | |||||
2,021 | 4,676,000 | |||||
2022 - 2026 | 22,651,000 | |||||
Total | 44,570,000 | |||||
Pension Benefit | Quoted Prices in Active Markets (Level 1) | ||||||
Plan net assets: | ||||||
Balance at end of year | 62,053,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 62,053,000 | 62,053,000 | ||||
Pension Benefit | Significant Other Observable Inputs (Level 2) | ||||||
Plan net assets: | ||||||
Balance at end of year | 12,775,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 12,775,000 | 12,775,000 | ||||
Pension Benefit | Level 3 | ||||||
Plan net assets: | ||||||
Balance at end of year | 503,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 503,000 | 503,000 | ||||
Pension Benefit | Cash, cash equivalents, money markets and other | ||||||
Plan net assets: | ||||||
Balance at end of year | 32,976,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 32,976,000 | $ 32,976,000 | ||||
Weighted-average asset allocations (as a percent) | 43.80% | 81.50% | ||||
Pension Benefit | Cash, cash equivalents, money markets and other | Quoted Prices in Active Markets (Level 1) | ||||||
Plan net assets: | ||||||
Balance at end of year | 32,976,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 32,976,000 | $ 32,976,000 | ||||
Pension Benefit | Common stock - domestic | ||||||
Plan net assets: | ||||||
Balance at end of year | 17,715,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 17,715,000 | $ 17,715,000 | ||||
Weighted-average asset allocations (as a percent) | 23.50% | 14.70% | ||||
Pension Benefit | Common stock - domestic | Quoted Prices in Active Markets (Level 1) | ||||||
Plan net assets: | ||||||
Balance at end of year | 17,715,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 17,715,000 | $ 17,715,000 | ||||
Pension Benefit | Common stock - foreign | ||||||
Plan net assets: | ||||||
Balance at end of year | 4,845,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 4,845,000 | $ 4,845,000 | ||||
Weighted-average asset allocations (as a percent) | 6.40% | |||||
Pension Benefit | Common stock - foreign | Quoted Prices in Active Markets (Level 1) | ||||||
Plan net assets: | ||||||
Balance at end of year | 3,629,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 3,629,000 | $ 3,629,000 | ||||
Pension Benefit | Common stock - foreign | Significant Other Observable Inputs (Level 2) | ||||||
Plan net assets: | ||||||
Balance at end of year | 1,216,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 1,216,000 | 1,216,000 | ||||
Pension Benefit | Mutual funds - equities | ||||||
Plan net assets: | ||||||
Balance at end of year | 7,141,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 7,141,000 | $ 7,141,000 | ||||
Weighted-average asset allocations (as a percent) | 9.50% | |||||
Pension Benefit | Mutual funds - equities | Quoted Prices in Active Markets (Level 1) | ||||||
Plan net assets: | ||||||
Balance at end of year | 6,180,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 6,180,000 | $ 6,180,000 | ||||
Pension Benefit | Mutual funds - equities | Significant Other Observable Inputs (Level 2) | ||||||
Plan net assets: | ||||||
Balance at end of year | 961,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 961,000 | 961,000 | ||||
Pension Benefit | Exchange traded funds - equities | ||||||
Plan net assets: | ||||||
Balance at end of year | 1,553,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 1,553,000 | $ 1,553,000 | ||||
Weighted-average asset allocations (as a percent) | 2.10% | |||||
Pension Benefit | Exchange traded funds - equities | Quoted Prices in Active Markets (Level 1) | ||||||
Plan net assets: | ||||||
Balance at end of year | 1,553,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 1,553,000 | $ 1,553,000 | ||||
Pension Benefit | Fixed income mutual funds | ||||||
Plan net assets: | ||||||
Balance at end of year | 10,142,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 10,142,000 | $ 10,142,000 | ||||
Weighted-average asset allocations (as a percent) | 13.50% | |||||
Pension Benefit | Fixed income mutual funds | Significant Other Observable Inputs (Level 2) | ||||||
Plan net assets: | ||||||
Balance at end of year | 10,142,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 10,142,000 | $ 10,142,000 | ||||
Pension Benefit | Fixed income securities | ||||||
Plan net assets: | ||||||
Balance at end of year | 456,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 456,000 | $ 456,000 | ||||
Weighted-average asset allocations (as a percent) | 0.60% | 3.80% | ||||
Pension Benefit | Fixed income securities | Significant Other Observable Inputs (Level 2) | ||||||
Plan net assets: | ||||||
Balance at end of year | 456,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 456,000 | $ 456,000 | ||||
Pension Benefit | Annuities | ||||||
Plan net assets: | ||||||
Balance at end of year | 503,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 503,000 | $ 503,000 | ||||
Weighted-average asset allocations (as a percent) | 0.70% | |||||
Pension Benefit | Annuities | Level 3 | ||||||
Plan net assets: | ||||||
Balance at end of year | 503,000 | |||||
Pension plan assets | ||||||
Fair value of plan assets | 503,000 | $ 503,000 | ||||
GTT Pension Benefit | ||||||
Projected benefit obligations: | ||||||
Balance at beginning of year | 14,400,000 | |||||
Balance at end of year | 12,549,000 | 14,400,000 | ||||
Funded status of plan | ||||||
Projected benefit obligation | $ 14,400,000 | $ 14,400,000 | 12,549,000 | $ 14,400,000 | ||
Plan Net Assets | 8,655,000 | 11,946,000 | ||||
Under funded status of plan | (3,894,000) | $ (2,454,000) | ||||
GTT Pension Benefit | Minimum | ||||||
Funded status of plan | ||||||
Percentage of plan assets to be invested within Guyana | 70.00% | |||||
GTT Pension Benefit | Maximum | ||||||
Funded status of plan | ||||||
Percentage of plan assets to be invested within Guyana | 80.00% | |||||
Innovative Pension Benefit | ||||||
Projected benefit obligations: | ||||||
Balance at end of year | $ 63,571,000 | |||||
Funded status of plan | ||||||
Projected benefit obligation | 63,571,000 | 63,571,000 | ||||
Plan Net Assets | 66,676,000 | |||||
Under funded status of plan | $ 3,105,000 | |||||
Postretirement Benefits | ||||||
Weighted-average rates assumed in the actuarial calculations for the pension plan | ||||||
Discount rate (as a percent) | 3.90% | |||||
One-percentage change in assumed health care cost trend rates | ||||||
Accumulated postretirement benefit obligation, At trend | $ 5,108,000 | |||||
Accumulated postretirement benefit obligation, At trend +1% | 5,487,000 | |||||
Impact of Accumulated postretirement benefit obligation, At trend +1% | $ 379,000 | |||||
Impact of Accumulated postretirement benefit obligation, At trend +1% (as a percent) | 7.40% | |||||
Accumulated postretirement benefit obligation, At trend -1% | 4,775,000 | |||||
Impact of Accumulated postretirement benefit obligation, At trend -1% | $ (333,000) | |||||
Impact of Accumulated postretirement benefit obligation, At trend -1% (as a percent) | (6.50%) | |||||
Service cost plus interest cost, At trend | $ 194,000 | |||||
Service cost plus interest cost, At Trend +1% | 214,000 | |||||
Impact of Service cost plus interest cost, At trend +1% | 20,000 | |||||
Impact of Service cost plus interest cost, At trend +1% (as a percent) | 10.30 | |||||
Service cost plus interest cost, At Trend -1% | 177,000 | |||||
Impact of Service cost plus interest cost, At trend -1% | $ (17,000) | |||||
Impact of Service cost plus interest cost, At trend -1% (as a percent) | (8.80%) | |||||
Projected benefit obligations: | ||||||
Innovative acquisition | $ 5,472,000 | |||||
Service cost | 97,000 | |||||
Interest cost | 97,000 | |||||
Benefits and settlements paid | (206,000) | |||||
Actuarial (gain) loss | (325,000) | |||||
Experience Loss | (27,000) | |||||
Balance at end of year | 5,108,000 | |||||
Plan net assets: | ||||||
Company contributions | 206,000 | |||||
Benefits and settlements paid | (206,000) | |||||
Funded status of plan | ||||||
Projected benefit obligation | 5,108,000 | 5,108,000 | ||||
Under funded status of plan | (5,108,000) | |||||
Restricted Cash and Cash Equivalents | 5,100,000 | |||||
Amounts recognized on the consolidated balance sheets | ||||||
Accrued and current liabilities | 381,000 | |||||
Other Liabilities | 4,727,000 | |||||
Accumulated other comprehensive income / (loss), net of tax | 352,000 | |||||
Amounts recognized in accumulated other comprehensive loss | ||||||
Net actuarial gain/(loss) | 352,000 | |||||
Accumulated other comprehensive loss, pre-tax | 352,000 | |||||
Accumulated other comprehensive income / (loss), net of tax | $ 352,000 | |||||
Components of the plan's net periodic pension cost | ||||||
Service cost | 97,000 | |||||
Interest cost | 97,000 | |||||
Net periodic pension cost | $ 194,000 | |||||
Medical benefit plan | ||||||
Health care cost trend rates | ||||||
Trend rate | 5.80% | |||||
Ultimate rate | 4.50% | |||||
Dental benefit plan | ||||||
Health care cost trend rates | ||||||
Trend rate | 4.00% | |||||
Ultimate rate | 2.00% |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Nov. 30, 2007 | Dec. 31, 2016 | Dec. 31, 2011 | |
Contingency related to spectrum fees | |||
Commitments and contingencies | |||
Spectrum fees paid | $ 2.6 | ||
Letter of credit sub-facility | |||
Commitments and contingencies | |||
Outstanding letters of credit | $ 10.6 | ||
Drawdowns | $ 0 | ||
Universal Service Administrative Company | |||
Commitments and contingencies | |||
Commitment fee (as a percent) | 1.75% | ||
Lawsuit filed by CTL | |||
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 | ||
Lawsuit filed by GTT against Digicel | |||
Commitments and contingencies | |||
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 | 44.1 | ||
Accrued contingent liability | $ 5 | ||
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% |
COMMITMENTS AND CONTINGENCIES72
COMMITMENTS AND CONTINGENCIES - Lease Commitments (Details) $ in Thousands, ft² in Millions | 12 Months Ended | ||
Dec. 31, 2016USD ($)ft² | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
COMMITMENTS AND CONTINGENCIES | |||
Area of lease (in square feet) | ft² | 2.7 | ||
Obligation for payments under leases | |||
2,017 | $ 20,908 | ||
2,018 | 26,120 | ||
2,019 | 16,100 | ||
2,020 | 17,090 | ||
2,021 | 7,170 | ||
Thereafter | 15,009 | ||
Total obligations under operating leases | 102,397 | ||
Rent expense | |||
Rent expense | $ 19,800 | $ 17,000 | $ 15,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2014USD ($)item | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Related Party Transaction | ||||
Rent payments | $ 19,800,000 | $ 17,000,000 | $ 15,000,000 | |
Cornelius B. Prior Jr | Tropical Tower | ||||
Related Party Transaction | ||||
Ownership percentage | 90 | |||
Rent payments | $ 117,000 | |||
Initial Term | 5 years | |||
Number of additional renewal period | item | 2 | |||
Renewal period | 5 years | |||
Percentage of increase in rent | 5.00% |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)segment | Dec. 31, 2014USD ($) | |
Segment reporting | |||||||||||
Number of reportable segments | segment | 5 | ||||||||||
Revenue | |||||||||||
Revenue | $ 128,531 | $ 138,795 | $ 99,991 | $ 89,686 | $ 82,916 | $ 96,782 | $ 90,326 | $ 85,345 | $ 457,003 | $ 355,369 | $ 336,347 |
Depreciation and amortization | 75,980 | 56,890 | 51,234 | ||||||||
Non-cash stock-based compensation | 6,410 | 4,975 | 4,323 | ||||||||
Operating income (loss) | 9,911 | $ 22,081 | $ 1,912 | $ 15,893 | 8,181 | $ 22,524 | $ 28,732 | $ 19,158 | 49,797 | 78,595 | 85,576 |
Segment Assets | |||||||||||
Net fixed assets | 647,712 | 373,503 | 647,712 | 373,503 | |||||||
Goodwill | 62,873 | 45,077 | 62,873 | 45,077 | |||||||
Long Lived Assets | 1,198,218 | 945,004 | 1,198,218 | 945,004 | |||||||
Capital Expenditures | |||||||||||
Capital expenditures | 124,282 | 64,753 | 58,300 | ||||||||
Wireless | |||||||||||
Revenue | |||||||||||
Revenue | 228,798 | 237,042 | 241,690 | ||||||||
Wireline | |||||||||||
Revenue | |||||||||||
Revenue | 188,019 | 86,485 | 85,284 | ||||||||
Equipment and other | |||||||||||
Revenue | |||||||||||
Revenue | 18,578 | 10,802 | 9,373 | ||||||||
Renewable energy | |||||||||||
Revenue | |||||||||||
Revenue | 21,608 | 21,040 | |||||||||
U.S | |||||||||||
Revenue | |||||||||||
Revenue | 198,300 | 204,024 | 180,841 | ||||||||
Guyana | |||||||||||
Revenue | |||||||||||
Revenue | 91,653 | 88,894 | 86,931 | ||||||||
U.S Virgin Islands | |||||||||||
Revenue | |||||||||||
Revenue | 58,431 | 11,542 | 11,583 | ||||||||
Bermuda | |||||||||||
Revenue | |||||||||||
Revenue | 83,006 | 45,745 | 46,917 | ||||||||
Other Foreign Countries | |||||||||||
Revenue | |||||||||||
Revenue | 25,613 | 5,164 | 10,075 | ||||||||
Reconciling Items | |||||||||||
Revenue | |||||||||||
Depreciation and amortization | 6,030 | 4,948 | 3,980 | ||||||||
Non-cash stock-based compensation | 6,274 | 4,708 | 4,323 | ||||||||
Operating income (loss) | (34,471) | (30,784) | (26,399) | ||||||||
Segment Assets | |||||||||||
Net fixed assets | 15,429 | 14,085 | 15,429 | 14,085 | |||||||
Long Lived Assets | 170,505 | 315,739 | 170,505 | 315,739 | |||||||
Capital Expenditures | |||||||||||
Capital expenditures | 6,876 | 4,323 | |||||||||
U.S. Telecom | |||||||||||
Segment Assets | |||||||||||
Goodwill | 35,268 | 39,639 | 35,268 | 39,639 | |||||||
U.S. Telecom | Operating segments | |||||||||||
Revenue | |||||||||||
Revenue | 176,726 | 182,986 | 180,391 | ||||||||
Depreciation and amortization | 24,471 | 22,239 | 19,070 | ||||||||
Operating income (loss) | 49,078 | 74,459 | 85,519 | ||||||||
Segment Assets | |||||||||||
Net fixed assets | 129,274 | 119,596 | 129,274 | 119,596 | |||||||
Goodwill | 35,269 | 39,639 | 35,269 | 39,639 | |||||||
Long Lived Assets | 240,006 | 227,707 | 240,006 | 227,707 | |||||||
Capital Expenditures | |||||||||||
Capital expenditures | 31,983 | 37,588 | |||||||||
U.S. Telecom | Operating segments | Wireless | |||||||||||
Revenue | |||||||||||
Revenue | 148,053 | 155,390 | 153,040 | ||||||||
U.S. Telecom | Operating segments | Wireline | |||||||||||
Revenue | |||||||||||
Revenue | 26,448 | 25,241 | 26,155 | ||||||||
U.S. Telecom | Operating segments | Equipment and other | |||||||||||
Revenue | |||||||||||
Revenue | 2,225 | 2,355 | 1,196 | ||||||||
International Telecom | |||||||||||
Segment Assets | |||||||||||
Goodwill | 24,326 | 5,438 | 24,326 | 5,438 | |||||||
International Telecom | Operating segments | |||||||||||
Revenue | |||||||||||
Revenue | 258,276 | 151,342 | 155,506 | ||||||||
Depreciation and amortization | 40,492 | 24,883 | 28,079 | ||||||||
Non-cash stock-based compensation | 22 | ||||||||||
Operating income (loss) | 35,436 | 28,200 | 28,674 | ||||||||
Segment Assets | |||||||||||
Net fixed assets | 372,741 | 133,262 | 372,741 | 133,262 | |||||||
Goodwill | 24,326 | 5,438 | 24,326 | 5,438 | |||||||
Long Lived Assets | 597,454 | 278,770 | 597,454 | 278,770 | |||||||
Capital Expenditures | |||||||||||
Capital expenditures | 62,808 | 22,804 | |||||||||
International Telecom | Operating segments | Wireless | |||||||||||
Revenue | |||||||||||
Revenue | 80,745 | 81,652 | 88,650 | ||||||||
International Telecom | Operating segments | Wireline | |||||||||||
Revenue | |||||||||||
Revenue | 161,571 | 61,244 | 59,129 | ||||||||
International Telecom | Operating segments | Equipment and other | |||||||||||
Revenue | |||||||||||
Revenue | 15,960 | 8,447 | 7,728 | ||||||||
Renewable energy | |||||||||||
Segment Assets | |||||||||||
Goodwill | 3,279 | 3,279 | |||||||||
Renewable energy | Operating segments | |||||||||||
Revenue | |||||||||||
Revenue | 22,001 | 21,040 | 449 | ||||||||
Depreciation and amortization | 4,987 | 4,820 | 105 | ||||||||
Non-cash stock-based compensation | 114 | 267 | |||||||||
Operating income (loss) | (246) | 6,720 | (2,218) | ||||||||
Segment Assets | |||||||||||
Net fixed assets | 130,268 | 106,560 | 130,268 | 106,560 | |||||||
Goodwill | 3,279 | 3,279 | |||||||||
Long Lived Assets | $ 190,253 | $ 122,788 | 190,253 | 122,788 | |||||||
Capital Expenditures | |||||||||||
Capital expenditures | 22,615 | 38 | |||||||||
Renewable energy | Operating segments | Equipment and other | |||||||||||
Revenue | |||||||||||
Revenue | 393 | $ 449 | |||||||||
Renewable energy | Operating segments | Renewable energy | |||||||||||
Revenue | |||||||||||
Revenue | $ 21,608 | $ 21,040 |
SEGMENT REPORTING - Revenue and
SEGMENT REPORTING - Revenue and Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue and long lived assets | |||||||||||
Revenue | $ 128,531 | $ 138,795 | $ 99,991 | $ 89,686 | $ 82,916 | $ 96,782 | $ 90,326 | $ 85,345 | $ 457,003 | $ 355,369 | $ 336,347 |
Long-Lived Assets | 680,461 | 381,029 | 680,461 | 381,029 | 377,032 | ||||||
U.S | |||||||||||
Revenue and long lived assets | |||||||||||
Revenue | 198,300 | 204,024 | 180,841 | ||||||||
Long-Lived Assets | 265,528 | 247,169 | 265,528 | 247,169 | 240,341 | ||||||
Guyana | |||||||||||
Revenue and long lived assets | |||||||||||
Revenue | 91,653 | 88,894 | 86,931 | ||||||||
Long-Lived Assets | 132,609 | 109,829 | 132,609 | 109,829 | 108,738 | ||||||
U.S Virgin Islands | |||||||||||
Revenue and long lived assets | |||||||||||
Revenue | 58,431 | 11,542 | 11,583 | ||||||||
Long-Lived Assets | 110,773 | 9,621 | 110,773 | 9,621 | 10,027 | ||||||
Bermuda | |||||||||||
Revenue and long lived assets | |||||||||||
Revenue | 83,006 | 45,745 | 46,917 | ||||||||
Long-Lived Assets | 94,976 | 13,483 | 94,976 | 13,483 | 12,507 | ||||||
Other Foreign Countries | |||||||||||
Revenue and long lived assets | |||||||||||
Revenue | 25,613 | 5,164 | 10,075 | ||||||||
Long-Lived Assets | $ 76,575 | $ 927 | $ 76,575 | $ 927 | $ 5,419 |
QUARTERLY FINANCIAL DATA (UNA76
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly financial data | ||||||||||||
Total revenue | $ 128,531 | $ 138,795 | $ 99,991 | $ 89,686 | $ 82,916 | $ 96,782 | $ 90,326 | $ 85,345 | $ 457,003 | $ 355,369 | $ 336,347 | |
Operating expenses | 118,620 | 116,714 | 98,079 | 73,793 | 74,735 | 74,258 | 61,594 | 66,187 | 407,206 | 276,774 | 250,771 | |
Income from operations | 9,911 | 22,081 | 1,912 | 15,893 | 8,181 | 22,524 | 28,732 | 19,158 | 49,797 | 78,595 | 85,576 | |
Other income (expense), net | (2,321) | (785) | (853) | (464) | (418) | (742) | (706) | (20,528) | (4,423) | (22,394) | 592 | |
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 7,590 | 21,296 | 1,059 | 15,429 | 7,763 | 21,782 | 28,026 | (1,370) | 45,374 | 56,201 | 86,168 | |
Income taxes | 3,982 | 9,602 | 2,945 | 4,631 | 1,482 | 10,134 | 13,008 | (487) | 21,160 | 24,137 | 28,148 | |
INCOME FROM CONTINUING OPERATIONS | 3,608 | 11,694 | (1,886) | 10,798 | 6,281 | 11,648 | 15,018 | (883) | 24,214 | 32,064 | 58,020 | |
Income from discontinued operations: | ||||||||||||
Gain on sale of discontinued operations, net of tax | 702 | 389 | 1,092 | 1,102 | ||||||||
Income from discontinued operations, net of tax | 702 | 390 | 1,092 | 1,102 | ||||||||
NET INCOME | 3,608 | 11,694 | (1,886) | 10,798 | 6,983 | 11,648 | 15,018 | (493) | 24,214 | 33,156 | 59,122 | |
Net income attributable to non-controlling interests, net of tax: | ||||||||||||
Continuing operations | (1,712) | (4,523) | (1,200) | (4,678) | (2,799) | (5,072) | (5,568) | (2,777) | ||||
NET INCOME ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS | $ 1,896 | $ 7,171 | $ (3,086) | $ 6,120 | $ 4,184 | $ 6,576 | $ 9,450 | $ (3,270) | $ 12,101 | $ 16,940 | $ 48,152 | |
NET INCOME PER WEIGHTED AVERAGE BASIC SHARE ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS: | ||||||||||||
Continuing operations (in dollars per share) | $ 0.12 | $ 0.44 | $ (0.19) | $ 0.38 | $ 0.17 | $ 0.41 | $ 0.59 | $ (0.18) | $ 0.75 | $ 0.99 | $ 2.96 | |
Discontinued operations: | ||||||||||||
Discontinued operations (in dollars per share) | 0.07 | |||||||||||
Total discontinued operations (in dollars per share) | 0.07 | 0.07 | 0.07 | |||||||||
Total (in dollars per share) | 0.12 | 0.44 | (0.19) | 0.38 | 0.17 | 0.41 | 0.59 | (0.11) | 0.75 | 1.06 | 3.03 | |
NET INCOME PER WEIGHTED AVERAGE DILUTED SHARE ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS: | ||||||||||||
Continuing operations (in dollars per share) | 0.12 | 0.44 | (0.19) | 0.38 | 0.16 | 0.41 | 0.59 | (0.18) | 0.75 | 0.98 | 2.94 | |
Discontinued operations: | ||||||||||||
Discontinued operations (in dollars per share) | 0.07 | |||||||||||
Total discontinued operations (in dollars per share) | 0.07 | 0.07 | 0.07 | |||||||||
Total (in dollars per share) | $ 0.12 | $ 0.44 | $ (0.19) | $ 0.38 | $ 0.16 | $ 0.41 | $ 0.59 | $ (0.11) | $ 0.75 | $ 1.05 | $ 3.01 | |
Additional information: | ||||||||||||
Reclassification, decrease (increase) to expense | $ (800) | $ 700 | ||||||||||
Tax basis differences and expense recognition adjustment | $ 700 | |||||||||||
International Telecom | Operating Expense | ||||||||||||
Additional information: | ||||||||||||
Understatement of expense | $ 300 | |||||||||||
Renewable energy | Revenue | ||||||||||||
Additional information: | ||||||||||||
Understatement of revenue | $ 500 |
SCHEDULE II VALUATION AND QUA77
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | $ 17,108 | $ 25,106 | $ 25,317 |
Purchase Price Accounting | 41,941 | ||
Charged to Costs and Expenses | 5,312 | 1,305 | 2,978 |
Deductions | 8,751 | 9,303 | 3,189 |
Balance at End of Year | 55,610 | 17,108 | 25,106 |
Valuation allowance on foreign tax credit carryforwards | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | 4,180 | 10,577 | 13,576 |
Deductions | 4,180 | 6,397 | 2,999 |
Balance at End of Year | 4,180 | 10,577 | |
Valuation allowance on foreign net operating losses | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | 1,672 | 1,500 | 1,610 |
Purchase Price Accounting | 41,941 | ||
Charged to Costs and Expenses | 217 | 172 | |
Deductions | 1,922 | 110 | |
Balance at End of Year | 41,908 | 1,672 | 1,500 |
Valuation allowance on state net operating losses | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | 1,962 | 1,687 | 1,126 |
Charged to Costs and Expenses | 275 | 561 | |
Deductions | 1,409 | ||
Balance at End of Year | 553 | 1,962 | 1,687 |
Allowance for doubtful accounts | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | 9,294 | 11,342 | 9,005 |
Charged to Costs and Expenses | 5,095 | 858 | 2,417 |
Deductions | 1,240 | 2,906 | 80 |
Balance at End of Year | $ 13,149 | $ 9,294 | $ 11,342 |