Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 10, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2023 | |
Entity File Number | 001-12593 | |
Entity Registrant Name | ATN INTERNATIONAL, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-0728886 | |
Entity Address, Address Line One | 500 Cummings Center | |
Entity Address, Address Line Two | Suite 2450 | |
Entity Address, City or Town | Beverly | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01915 | |
City Area Code | 978 | |
Local Phone Number | 619-1300 | |
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | ATNI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,738,576 | |
Entity Central Index Key | 0000879585 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 56,016 | $ 54,660 |
Restricted cash | 4,961 | 5,068 |
Short-term investments | 300 | 300 |
Accounts receivable, net of allowances for credit losses of $16.0 million and $15.2 million, respectively | 84,483 | 86,816 |
Customer receivable | 6,083 | 5,803 |
Inventory, materials and supplies | 18,485 | 17,902 |
Prepayments and other current assets | 61,224 | 59,139 |
Total current assets | 231,552 | 229,688 |
Fixed Assets: | ||
Property, plant and equipment | 2,001,455 | 1,977,978 |
Less accumulated depreciation | (945,092) | (922,024) |
Net fixed assets | 1,056,363 | 1,055,954 |
Telecommunication licenses, net | 113,698 | 113,698 |
Goodwill | 40,104 | 40,104 |
Intangible assets, net | 28,823 | 31,992 |
Operating lease right-of-use assets | 101,953 | 108,702 |
Customer receivable - long term | 45,681 | 46,706 |
Other assets | 81,841 | 81,025 |
Total assets | 1,700,015 | 1,707,869 |
Current Liabilities: | ||
Current portion of long-term debt | 11,537 | 6,173 |
Current portion of customer receivable credit facility | 6,574 | 6,073 |
Accounts payable and accrued liabilities | 118,240 | 155,224 |
Dividends payable | 3,323 | 3,310 |
Accrued taxes | 13,611 | 7,335 |
Current portion of lease liabilities | 13,785 | 15,457 |
Advance payments and deposits | 38,314 | 39,608 |
Total current liabilities | 205,384 | 233,180 |
Deferred income taxes | 26,697 | 28,650 |
Lease liabilities, excluding current portion | 78,360 | 83,319 |
Other liabilities | 137,148 | 138,420 |
Customer receivable credit facility, net of current portion | 41,533 | 39,275 |
Long-term debt, excluding current portion | 453,144 | 415,727 |
Total liabilities | 942,266 | 938,571 |
Total redeemable noncontrolling interests | 93,223 | 92,469 |
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; 17,679,616 and 17,584,057 shares issued, respectively, 15,787,337 and 15,763,341 shares outstanding, respectively | 173 | 173 |
Treasury stock, at cost; 1,892,279 and 1,820,716 shares, respectively | (76,665) | (73,825) |
Additional paid-in capital | 200,015 | 198,449 |
Retained earnings | 437,030 | 449,806 |
Accumulated other comprehensive income | 6,690 | 6,210 |
Total ATN International, Inc. stockholders' equity | 567,243 | 580,813 |
Noncontrolling interests | 97,283 | 96,016 |
Total equity | 664,526 | 676,829 |
Total liabilities, redeemable noncontrolling interests and equity | 1,700,015 | 1,707,869 |
Redeemable Preferred Units | ||
Current Liabilities: | ||
Total redeemable noncontrolling interests | 56,197 | 55,152 |
Redeemable Common Units | ||
Current Liabilities: | ||
Total redeemable noncontrolling interests | $ 37,026 | $ 37,317 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowances (in dollars) | $ 16 | $ 15.2 |
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 | 17,679,616 | 17,584,057 |
Common stock, shares outstanding | 15,787,337 | 15,763,341 |
Treasury stock, shares | 1,892,279 | 1,820,716 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
REVENUE: | ||
Total revenue | $ 185,774 | $ 172,019 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||
Selling, general and administrative | 61,348 | 54,882 |
Stock-based compensation | 1,778 | 1,461 |
Transaction-related charges | 13 | 554 |
Restructuring expenses | 2,887 | |
Depreciation and amortization | 36,404 | 33,292 |
Amortization of intangibles from acquisitions | 3,247 | 3,258 |
(Gain) Loss on disposition of long-lived assets | (167) | 3,420 |
Total operating expenses | 185,138 | 171,911 |
Income from operations | 636 | 108 |
OTHER INCOME (EXPENSE) | ||
Interest income | 182 | 51 |
Interest expense | (8,807) | (3,363) |
Other income | 194 | 4,199 |
Other income (expense) | (8,431) | 887 |
INCOME (LOSS) BEFORE INCOME TAXES | (7,795) | 995 |
Income tax (benefit) expense | (740) | 2,952 |
NET LOSS | (7,055) | (1,957) |
Net loss attributable to noncontrolling interests, net of tax benefit of $(0.6) million and $(0.5) million respectively | 1,170 | 1,009 |
NET LOSS ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS | $ (5,885) | $ (948) |
Basic (in dollars per share) | $ (0.44) | $ (0.13) |
Diluted (in dollars per share) | $ (0.44) | $ (0.13) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||
Basic (in shares) | 15,768 | 15,708 |
Diluted (in shares) | 15,768 | 15,708 |
DIVIDENDS PER SHARE APPLICABLE TO COMMON STOCK | $ 0.21 | $ 0.17 |
Communication services | ||
REVENUE: | ||
Total revenue | $ 181,308 | $ 166,543 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||
Cost of services | 79,040 | 73,011 |
Construction | ||
REVENUE: | ||
Total revenue | 590 | 1,987 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||
Cost of services | 588 | 2,033 |
Other revenue | ||
REVENUE: | ||
Total revenue | $ 3,876 | $ 3,489 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Non-controlling interest income tax expense (benefit) | $ (0.6) | $ (0.5) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Net loss | $ (7,055) | $ (1,957) |
Other comprehensive income: | ||
Foreign currency translation adjustment | 111 | 256 |
Reclassification of loss on pension settlement | 369 | |
Unrealized gain on derivatives | 166 | |
Other comprehensive income, net of tax | 480 | 422 |
Comprehensive loss | (6,575) | (1,535) |
Less: Comprehensive loss attributable to noncontrolling interests | 1,170 | 1,009 |
Comprehensive loss attributable to ATN International, Inc. | $ (5,405) | $ (526) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Redeemable Preferred Units Total ATNI Stockholders' Equity | Redeemable Preferred Units Retained Earnings | Redeemable Preferred Units | Redeemable Common Units Total ATNI Stockholders' Equity | Redeemable Common Units Retained Earnings | Redeemable Common Units Non-Controlling Interests | Redeemable Common Units | Total ATNI Stockholders' Equity | Common Stock | Treasury Stock, at cost | Additional Paid In Capital | Retained Earnings | Other Comprehensive Income/(Loss) | Non-Controlling Interests | Total |
Balance, beginning of period at Dec. 31, 2021 | $ 601,250 | $ 172 | $ (71,714) | $ 192,132 | $ 475,887 | $ 4,773 | $ 101,003 | $ 702,253 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Purchase of shares of common stock | (2,081) | (2,081) | (2,081) | ||||||||||||
Stock-based compensation | 1,310 | 1,310 | 150 | 1,460 | |||||||||||
Dividends declared on common stock | (2,675) | (2,675) | (263) | (2,938) | |||||||||||
Repurchase of non-controlling interests | (278) | (278) | (2,205) | (2,483) | |||||||||||
Accrued dividend - redeemable preferred units | $ 1,116 | $ 1,116 | $ 1,116 | ||||||||||||
Comprehensive income: | |||||||||||||||
Net loss | (2,040) | (2,040) | 83 | (1,957) | |||||||||||
Other comprehensive income (loss) | 422 | 422 | 422 | ||||||||||||
Comprehensive loss | (1,618) | (2,040) | 422 | 83 | (1,535) | ||||||||||
Balance, end of period at Mar. 31, 2022 | 594,792 | 172 | (73,795) | 193,164 | 470,056 | 5,195 | 98,768 | 693,560 | |||||||
Balance, beginning of period at Dec. 31, 2022 | 580,813 | 173 | (73,825) | 198,449 | 449,806 | 6,210 | 96,016 | 676,829 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Purchase of shares of common stock | (2,840) | (2,840) | (2,840) | ||||||||||||
Stock-based compensation | 1,634 | 1,634 | 144 | 1,778 | |||||||||||
Dividends declared on common stock | (3,315) | (3,315) | (3,315) | ||||||||||||
Repurchase of non-controlling interests | (68) | (68) | (527) | (595) | |||||||||||
Deemed dividend | $ (1,045) | $ (1,045) | $ (1,045) | $ (2,531) | $ (2,531) | $ 2,820 | $ 289 | ||||||||
Comprehensive income: | |||||||||||||||
Net loss | (5,885) | (5,885) | (1,170) | (7,055) | |||||||||||
Other comprehensive income (loss) | 480 | 480 | 480 | ||||||||||||
Comprehensive loss | (5,405) | (5,885) | 480 | (1,170) | (6,575) | ||||||||||
Balance, end of period at Mar. 31, 2023 | $ 567,243 | $ 173 | $ (76,665) | $ 200,015 | $ 437,030 | $ 6,690 | $ 97,283 | $ 664,526 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY | ||
Purchase of shares of common stock | 71,563 | 56,284 |
Dividends declared on common stock (dollars per per share) | $ 0.21 | $ 0.17 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Cash flows from operating activities: | |||
Net loss | $ (7,055) | $ (1,957) | |
Adjustments to reconcile net loss to net cash flows provided by operating activities: | |||
Depreciation and amortization | 36,404 | 33,292 | |
Amortization of intangibles from acquisitions | 3,247 | 3,258 | |
Provision for doubtful accounts | 1,378 | 1,913 | |
Amortization of debt discount and debt issuance costs | 569 | 501 | |
(Gain) loss on disposition of long-lived assets | (167) | 3,420 | |
Stock-based compensation | 1,778 | 1,461 | |
Deferred income taxes | (1,953) | 191 | |
Loss on pension settlement | 369 | ||
Gain on equity investments | (315) | (4,222) | |
Changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions: | |||
Accounts receivable | 3,573 | 1,677 | |
Customer receivable | 745 | (746) | |
Prepaid income taxes | 679 | 6,206 | |
Accrued taxes | 6,953 | 2,763 | |
Materials and supplies, prepayments, and other current assets | (3,503) | (5,330) | |
Accounts payable and accrued liabilities, advance payments and deposits and other current liabilities | (24,548) | (27,465) | |
Other assets | 141 | (325) | |
Other liabilities | (2,283) | (3,249) | |
Net cash provided by operating activities | 16,012 | 11,388 | $ 102,900 |
Cash flows from investing activities: | |||
Capital expenditures | (50,598) | (34,220) | |
Government capital programs - Amounts disbursed | (2,127) | (248) | |
Government capital programs - Amounts received | 593 | ||
Purchases of strategic investments | (630) | ||
Net cash used in investing activities | (52,762) | (34,468) | |
Cash flows from financing activities: | |||
Dividends paid on common stock | (3,310) | (2,672) | |
Distributions to noncontrolling interests | (263) | ||
Payment of debt issuance costs | (119) | ||
Finance lease payment | (249) | (338) | |
Term loan - repayments | (1,171) | (938) | |
Revolving credit facility - borrowings | 57,553 | 36,500 | |
Revolving credit facility - repayments | (14,000) | (15,500) | |
Proceeds from customer receivable credit facility | 4,300 | 8,000 | |
Repayment of customer receivable credit facility | (1,570) | (1,003) | |
Purchases of common stock - stock- based compensation | (1,433) | (1,136) | |
Purchases of common stock - share repurchase plan | (1,407) | (941) | |
Repurchases of noncontrolling interests | (595) | (2,481) | |
Net cash provided by financing activities | 37,999 | 19,228 | |
Net change in cash, cash equivalents, and restricted cash | 1,249 | (3,852) | |
Total cash, cash equivalents, and restricted cash, beginning of period | 59,728 | 80,697 | 80,697 |
Total cash, cash equivalents, and restricted cash, end of period | 60,977 | 76,845 | $ 59,728 |
Noncash investing activity: | |||
Purchases of property, plant and equipment included in accounts payable and accrued expenses | $ 16,208 | $ 13,221 |
ORGANIZATION AND BUSINESS OPERA
ORGANIZATION AND BUSINESS OPERATIONS | 3 Months Ended |
Mar. 31, 2023 | |
ORGANIZATION AND BUSINESS OPERATIONS | |
ORGANIZATION AND BUSINESS OPERATIONS | 1. ORGANIZATION AND BUSINESS OPERATIONS The Company provides digital infrastructure and communications services in the United States and internationally, including in the Caribbean region, with a focus on smaller markets, many of which are rural or remote, with a growing demand for infrastructure investments, Through its operating subsidiaries, it primarily provides: (i) carrier and enterprise communications services, such as terrestrial and submarine fiber optic transport, and communications tower facilities; and (ii) fixed and mobile telecommunications connectivity to residential, business and government customers, including a range of high-speed internet and data services, fixed and mobile wireless solutions, and video and voice services. At the holding company level, the Company oversees the allocation of capital within and among its subsidiaries, affiliates, new investments, and stockholders. The Company has developed significant operational expertise and resources that it uses to augment the capabilities of its individual operating subsidiaries in its local markets. The Company has built a platform of resources and expertise to support its operating subsidiaries and to improve their quality of service with greater economies of scale and expertise than would typically be available at the operating subsidiary level. The Company provides management, technical, financial, regulatory, and marketing services to its operating subsidiaries and typically receive a management fee calculated as a percentage of their revenues, which is eliminated in consolidation. The Company also actively evaluates potential acquisitions, investment opportunities and other strategic transactions, both domestic and international, and generally look for those that it believes fit the Company’s profile of telecommunications businesses and have the potential to complement its “glass and steel” and “first to fiber” approach in markets while generating steady excess cash flows over extended periods of time. The Company uses the cash generated from its operations to re-invest in organic growth in its existing businesses, to make strategic investments in additional businesses, and to return cash to its investors through dividends or stock repurchases. As of March 31, 2023, the Company offered the following types of services to its customers: ● Mobility Telecommunications Services . The Company offers mobile communications services over its wireless networks and related equipment (such as handsets) to both its business and consumer customers. ● Fixed Telecommunications Services . The Company provides fixed data and voice telecommunications services to business and consumer customers. These services include consumer broadband and high-speed data solutions for businesses. For some markets, fixed services also include video services and revenue derived from support under certain government programs. ● Carrier Telecommunication Services . The Company delivers services to other telecommunications providers such as the leasing of critical network infrastructure, such as tower and transport facilities, wholesale roaming, site maintenance and international long-distance services. ● Managed Services . The Company provides information technology services such as network, application, infrastructure and hosting services to both its business and consumer customers to complement its fixed services in its existing markets. As was previously disclosed, and effective January 27, 2021, the Company no longer provides distributed generation solar power to commercial and industrial customers. These operations were the only operations within the Company’s Renewable Energy segment. As such, the Company no longer identifies the Renewable Energy segment as an operating segment and now has only two operating segments to manage and review its operations and to facilitate investor presentations of its results. These two operating segments are as follows: ● International Telecom . In the Company’s international markets, it offers fixed services, mobility services, carrier services and managed services to customers in Bermuda, the Cayman Islands, Guyana and the US Virgin Islands. ● US Telecom . In the United States, the Company offers fixed services, carrier services, and managed services to business and consumer customers in Alaska and the western United States. 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 during the three months ended March 31, 2023: Segment Services Markets Tradenames International Telecom Mobility Services Bermuda, Guyana, US Virgin Islands One, GTT, Viya Fixed Services Bermuda, Cayman Islands, Guyana, US Virgin Islands One, Logic, GTT, Viya Carrier Services Bermuda, Guyana, US Virgin Islands One, GTT, Viya Managed Services Bermuda, Cayman Islands, US Virgin Islands, Guyana Fireminds, One, Logic, GTT, Viya US Telecom Mobility Services United States (rural markets) Choice, Choice NTUA Wireless Fixed Services United States Alaska Communications, Commnet, Choice, Choice NTUA Wireless, Sacred Wind Communications, Ethos Carrier Services United States Alaska Communications, Commnet, Essextel, Sacred Wind Communications Managed Services United States Alaska Communications, Choice For further information about the Company’s financial segments and geographical information about its operating revenues and assets, see Note 13 to the Unaudited Condensed Consolidated Financial Statements included in this Report. Liquidity The Company’s 2019 CoBank Credit Facility matures on April 10, 2024, which is within twelve months of the issuance of these consolidated financial statements. At March 31, 2023, the Company owed million for amounts drawn under the credit facility. For the year ended December 31, 2022, the Company generated positive cash flows from operating activities of million. At March 31, 2023, the Company had cash equivalents and $5.0 million of restricted cash. If the Company is unable to refinance its existing debt or obtain additional financing on or before the maturity of the 2019 CoBank Credit Facility, this could impact the Company’s ability to meet its obligations coming due within one year after issuance of these consolidated financial statements. Management is actively pursuing debt financing options which would extend the maturity date of the 2019 CoBank Credit Facility and may increase its capacity, and management expects to complete this financing process during 2023. In the event the Company is unable to refinance or replace its 2019 CoBank Credit Facility, the Company has additional actions at its discretion, including reducing capital expenditures not required to sustain current network operations, reducing operating cash outflows such as marketing and general and administrative expenses, and pursuing equity financing through issuance of equity securities in public markets. However, management does not currently believe these additional actions will be required to be implemented due to its debt refinancing plans. In light of the plans discussed above, management believes it is probable the Company will meet its obligations as they come due for a minimum of twelve months from the issuance date of these consolidated financial statements. However, if the Company were unable to refinance its existing debt, obtain additional financing, or implement the above plans, as needed, there could be an adverse impact on the Company’s operations. Restructuring Expense million restructuring charge during the three months ended March 31, 2023 related to the decommissioning of certain cell sites. The charge is recorded in the Restructuring Expense on the Company’s statement of operations. As of March 31, 2023, the Company paid million of the restructuring expenses. In conjunction with the restructuring the Company terminated |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2023 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | 2. BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial information included herein is unaudited; however, the Company believes such information and the disclosures herein are adequate to make the information presented not misleading and reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company’s financial position and results of operations for the periods described therein. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. Results of interim periods may not be indicative of results for the full year. These condensed consolidated financial statements and related notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 15, 2023. The condensed consolidated financial statements include the accounts of the Company, its subsidiaries in which the Company holds controlling interests 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. |
REVENUE RECOGNITION AND RECEIVA
REVENUE RECOGNITION AND RECEIVABLES | 3 Months Ended |
Mar. 31, 2023 | |
REVENUE RECOGNITION AND RECEIVABLES | |
REVENUE RECOGNITION AND RECEIVABLES | 3. REVENUE RECOGNITION AND RECEIVABLES Revenue Accounted for in Accordance with Other Guidance The Company records revenue in accordance with ASC 606 from contracts with customers and ASC 842 from lease agreements, as well as government grants. Lease revenue recognized under ASC 842 is disclosed in Note 4 and government grant revenue is disclosed in Note 9. Timing of Revenue Recognition Revenue accounted for in accordance with ASC 606 consisted of the following for the periods presented below. Three months ended March 31, 2023 March 31, 2022 Services transferred over time US Telecom $ 81,072 $ 72,290 International Telecom 85,680 81,302 Total 166,752 153,592 Goods and services transferred at a point in time US Telecom 2,546 3,597 International Telecom 3,259 2,723 Total 5,805 6,320 Total revenue accounted for under ASC 606 172,557 159,912 Contract Assets and Liabilities The Company recognizes contract assets and liabilities on its balance sheet. Contract assets represent unbilled amounts typically resulting from consumer Mobility contracts with both a multiyear service period and a promotional discount. In these contracts, the revenue recognized exceeds the amount billed to the customer. The current portion of the contract asset is recorded in prepayments and other current assets and the noncurrent portion is included in other assets on the Company’s balance sheets. Contract liabilities consist of advance payments and billings in excess of revenue recognized. Mobility and Fixed revenue for postpaid customers is generally billed in advance and recognized over the period that the corresponding service is rendered to customers. To the extent the service is not provided by the reporting date the amount is recognized as a contract liability. Prepaid service, including Mobility services, sold to customers is recorded as deferred revenue prior to the commencement of services. Contract liabilities also include certain long term fixed business and carrier service customer contracts. Contract liabilities are recorded in advanced payments and deposits and other liabilities on the Company’s balance sheets. In July 2019, the Company entered into a Network Build and Maintenance Agreement with AT&T Mobility, LLC (“AT&T”) and subsequently entered into amendments in August 2020, May 2021 and August 2022 (the “FirstNet Agreement”). In connection with the FirstNet Agreement, the Company is building a portion of AT&T’s network for the First Responder Network Authority in or near the Company’s current operating areas in the western United States (the “FirstNet Transaction”). The FirstNet Transaction includes construction and service performance obligations. The Company allocated the transaction price of the FirstNet Agreement to each performance obligation based on the relative standalone selling price of each performance obligation in the contract. The standalone selling price is the estimated price the Company would charge for the good or service in a separate transaction with similar customers in similar circumstances. The current portion of receivables under this agreement is recorded in customer receivable and the long-term portion is recorded in customer receivable long-term on the Company’s balance sheet. Contract assets and liabilities consisted of the following (amounts in thousands): March 31, 2023 December 31, 2022 $ Change % Change Contract asset – current $ 3,010 $ 2,932 $ 78 3 % Contract asset – noncurrent 3,734 3,775 (41) (1) % Contract liability – current (26,086) (27,284) 1,198 4 % Contract liability – noncurrent (70,444) (72,543) 2,099 3 % Net contract liability $ (89,786) $ (93,120) $ 3,334 4 % The contract asset – current is included in prepayments and other current assets and the contract asset – noncurrent is included in other assets on the Company’s balance sheet. The contract liability – current is included in advance payments and deposits and the contract liability – noncurrent is included in other liabilities on the Company’s balance sheet. The decrease in the Company’s net contract liability was due to the timing of customer prepayments, contract billings, and recognition of deferred revenue. During the three months ended March 31, 2023, the Company recognized revenue of Contract Acquisition Costs The March 31, 2023 balance sheet includes contract acquisition costs of $9.0 million in other assets. During the three months ended March 31, 2023 and 2022, the Company amortized Remaining Performance Obligations Remaining performance obligations represent the transaction price allocated to unsatisfied performance obligations of certain multiyear Mobility contracts, which include a promotional discount, Managed Services contracts, and the Company’s Carrier Services construction and service contracts. The transaction price allocated to unsatisfied performance obligations was million at March 31, 2023 and December 31, 2022, respectively. The Company expects to satisfy approximately and the remainder thereafter. The Company has certain Mobility, Fixed, and Carrier Services contracts where the transaction price is allocated to remaining performance obligations. However, the Company omits these contracts from its disclosure by applying the right to invoice, one year or less, and wholly unsatisfied performance obligation practical expedients. Disaggregation The Company's revenue is presented on a disaggregated basis in Note 13 based on an evaluation of disclosures outside the financial statements, information regularly reviewed by the chief operating decision makers for evaluating the financial performance of operating segments and other information that is used for performance evaluation and resource allocations. This includes revenue from Communication Services, Construction, and Other revenue. Communication Services revenue is further disaggregated into business and consumer Mobility, business and consumer Fixed, Carrier Services, and Other services. Other revenue is further disaggregated into Managed Services revenue. Receivables The Company records an estimate of future credit losses in conjunction with the revenue transaction based on the information available including historical experience and management’s expectations of future conditions. Those estimates will be updated as additional information becomes available. The Company’s allowance for uncollectible accounts receivable is based on management’s assessment of the collectability of assets pooled together with similar risk characteristics. At March 31, 2023, the Company had gross accounts receivable of $152.3 million, an allowance for credit losses of $16.0 million and a receivable under the FirstNet Agreement totaling $51.8 million of which $6.1 million was current and $45.7 million was long-term. At December 31, 2022, the Company had gross accounts receivable of million was long-term. The Company monitors receivables through the use of historical operating data adjusted for the expectation of future performance as appropriate. Activity in the allowance for credit losses is below: Three months ended March 31, 2023 March 31, 2022 Balance at beginning of period $ 15,171 $ 13,885 Current period provision for expected losses 1,378 1,913 Write-offs charged against the allowance (591) (862) Recoveries collected 74 108 Balance at end of period $ 16,032 $ 15,044 |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2023 | |
LEASES | |
LEASES | 4. LEASES Lessee Disclosure The Company has operating and financing leases for towers, land, corporate offices, retail facilities, and data transport capacity. The lease terms three Supplemental lease information The components of lease expense were as follows (in thousands): Three months ended March 31, 2023 March 31, 2022 Operating lease cost: Operating lease cost $ 5,981 $ 6,142 Short-term lease cost 677 509 Variable lease cost 662 804 Total operating lease cost $ 7,320 $ 7,455 Finance lease cost: Amortization of right-of-use asset $ 699 $ 797 Variable costs 203 248 Interest costs 84 102 Total finance lease cost $ 986 $ 1,147 During the three months ended March 31, 2023 and 2022, the Company paid $5.0 million and $5.6 million, respectively, for operating lease liabilities. During the three months ended March 31, 2023 and 2022, the Company recorded $2.9 million and $3.7 million, respectively, of operating lease liabilities arising from ROU assets. During the three months ended March 31, 2023, in conjunction with the restructuring activities the Company terminated $5.0 million of lease right of use assets, $5.3 million of lease liabilities from its balance sheet, and recorded a gain of $0.3 million in the restructuring expense line of its statement of operations. At March 31, 2023, finance leases with a cost of $27.5 million and accumulated amortization of $14.1 million were included in property, plant and equipment. During the three months ended March 31, 2023, the Company paid $0.2 million of financing cash flows, $0.9 million of investing cash flows and $0.1 million of operating cash flows for finance lease liabilities. At March 31, 2023, finance leases had a lease liability of At December 31, 2022, finance leases with a cost of $26.6 million and accumulated amortization of $13.5 million were included in property, plant and equipment. The weighted average remaining lease terms and discount rates as of March 31, 2023 and December 31, 2022 are noted in the table below: March 31, 2023 December 31, 2022 Weighted-average remaining lease term Operating leases 13.1 years 12.4 years Financing leases 9.3 years 9.3 years Weighted-average discount rate Operating leases 6.1% 6.0% Financing leases 6.9% 6.7% Maturities of lease liabilities as of March 31, 2023 were as follows (in thousands): Operating Leases Financing Leases 2023 (excluding the three months ended March 31, 2023) 12,977 1,045 2024 17,023 1,240 2025 13,897 972 2026 9,771 504 2027 7,708 495 Thereafter 79,134 2,651 Total lease payments 140,510 6,907 Less imputed interest (53,450) (1,822) Total $ 87,060 $ 5,085 Maturities of lease liabilities as of December 31, 2022 were as follows (in thousands): Operating Leases Financing Leases 2023 $ 19,417 $ 1,403 2024 17,836 1,342 2025 14,805 978 2026 10,505 504 2027 8,096 495 Thereafter 76,452 2,651 Total lease payments 147,111 7,373 Less imputed interest (53,794) (1,914) Total $ 93,317 $ 5,459 As of March 31, 2023, the Company did not have any material operating or finance leases that have not yet commenced. Lessor Disclosure The Company is the lessor in agreements to lease the use of its network assets including its cell sites and buildings. For the three months ended million, respectively, of lease income from agreements in which the Company is the lessor. Lease income is classified as Carrier Services revenue in the statement of operations. The following table presents the maturities of future undiscounted lease payments for the periods indicated: 2023 (excluding the three months ended March 31, 2023) $ 4,609 2024 5,891 2025 5,716 2026 5,410 2027 4,267 Thereafter 14,360 Total future lease payments $ 40,253 |
USE OF ESTIMATES
USE OF ESTIMATES | 3 Months Ended |
Mar. 31, 2023 | |
USE OF ESTIMATES | |
USE OF ESTIMATES | 5. 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 credit losses on trade receivables, 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. |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 3 Months Ended |
Mar. 31, 2023 | |
ACQUISITIONS AND DISPOSITIONS | |
ACQUISITIONS AND DISPOSITIONS | 6. ACQUISITIONS AND DISPOSITIONS US Telecom Acquisition of Sacred Wind Enterprises On November 7, 2022, the Company’s newly formed wholly owned subsidiary Alloy, Inc. (Alloy”) acquired all of the issued and outstanding stock of Sacred Wind Enterprises, Inc. (“Sacred Wind”), Inc., a rural telecommunications provider in New Mexico for $44.6 million of consideration (“Sacred Wind Transaction”). The purchase price allocation was finalized during the three months ended March 31, 2023. As part of the Sacred Wind Transaction, the Company transferred consideration of $18.0 million of cash, net of $9.4 million of cash acquired, $14.8 million of redeemable noncontrolling interests, and $3.7 million of contingent consideration less $1.3 million of receivables related to working capital adjustments. Upon completion of the Sacred Wind Transaction, the former Sacred Wind shareholders own 6% of the Alloy equity. This equity is classified as redeemable noncontrolling interests in the Company’s financial statements because the holders have an option, beginning in 2026, to put the equity interest to a subsidiary of the Company at the then fair market value. The redeemable noncontrolling interests do not have preference relative to other equity units and participate in gains and losses in Alloy. The contingent consideration is earned based on certain operating metrics of Sacred Wind beginning in 2025 through 2027. The fair value of the contingent consideration was calculated using discounted cash flow analysis based on a range of probability weighted outcomes. The Company funded the acquisition with borrowings under its CoBank Credit Facility and assumed The table below represents the purchase price allocation of the total consideration transferred to the acquired assets and assumed liabilities based on management’s estimate of their acquisition date fair values (amounts in thousands): Consideration Transferred $ 44,560 Preliminary purchase price allocation: Cash and cash equivalents 2,619 Restricted cash 6,747 Current assets 4,888 Operating lease right of use assets 989 Fixed assets 85,255 Intangible assets 1,232 Current liabilities (10,176) Lease liabilities (967) Deferred taxes (14,388) Debt (31,639) Net assets acquired $ 44,560 The acquired fixed assets are comprised of telecommunication equipment located in the Southwest United States. The fixed assets were valued using the income and cost approaches. Cash flows were discounted between 7% and 12% based on the risk associated with the cash flows to determine fair value under the income approach. The fixed assets have useful lives ranging from 1 to 25 years. The intangible assets include a $0.6 million trade name. The estimated fair value of the trade name was determined using the relief from royalty method. The useful life of the trade name is 5 years. The acquired receivables consist of trade receivables incurred in the ordinary course of business. The Company expects to collect the full amount of the receivables. Current liabilities includes $6.5 million of deposits received under government grant programs that will be used to construct fixed assets in future periods. The Company incurred $0.8 million of transaction-related charges pertaining to legal, accounting, consulting services, and employee related costs associated with the transaction during the year ended December 31, 2022. |
FAIR VALUE MEASUREMENTS AND INV
FAIR VALUE MEASUREMENTS AND INVESTMENTS | 3 Months Ended |
Mar. 31, 2023 | |
FAIR VALUE MEASUREMENTS AND INVESTMENTS | |
FAIR VALUE MEASUREMENTS AND INVESTMENTS | 7. FAIR VALUE MEASUREMENTS AND INVESTMENTS 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 March 31, 2023 and December 31, 2022 are summarized as follows (in thousands): March 31, 2023 Significant Other Quoted Prices in Unobservable Active Markets Inputs Description (Level 1) (Level 3) Total Short term investments $ 300 $ — $ 300 Other investments — 1,694 1,694 Alaska Communications redeemable common units — (22,266) (22,266) Alloy redeemable common units — (14,760) (14,760) Warrants on Alaska Communications redeemable common units — (654) (654) Total assets and liabilities measured at fair value $ 300 $ (35,986) $ (35,686) December 31, 2022 Significant Other Quoted Prices in Unobservable Active Markets Inputs Description (Level 1) (Level 3) Total Short term investments $ 300 $ — $ 300 Other investments — 1,616 1,616 Alaska Communications redeemable common units — (22,557) (22,557) Alloy redeemable common units — (14,760) (14,760) Warrants on Alaska Communications redeemable common units — (654) (654) Total assets and liabilities measured at fair value $ 300 $ (36,355) $ (36,055) Other Investments The Company holds investments in equity securities consisting of noncontrolling investments in privately held companies. The investments are accounted for using equity method accounting, the measurement alternative for investments without a readily determinable fair value, or fair value. The fair value investments are valued using level 3 inputs and the Company used the income approach to fair value the investment. The inputs consisted of a discount rate and future cash flows calculated based on the investment attributes. A roll forward of the investments is below: Investments without a readily determinable fair value Fair value investments Equity investments Total Balance, December 31, 2022 $ 22,590 $ 1,616 $ 13,963 $ 38,169 Income recognized — 77 238 315 Contributions — — 630 630 Foreign currency gain — — 111 111 Balance, March 31, 2023 $ 22,590 $ 1,693 $ 14,942 $ 39,225 Balance, December 31, 2021 $ 17,820 $ 1,925 $ 28,699 $ 48,444 Income (loss) recognized — 99 (662) (563) Foreign currency gain — — 256 256 Gain recognized 4,770 — — 4,770 Balance, March 31, 2022 $ 22,590 $ 2,024 $ 28,293 $ 52,907 These investments are included with other assets on the consolidated balance sheets. Redeemable Common Units and Warrants The Company has issued redeemable common units, and warrants to purchase additional common units, in consolidated subsidiaries of the Company. The instruments are redeemable at the option of the holder. Both the common units and warrants to purchase common units are recorded at fair value in the Company’s financial statements. The common units are recorded in redeemable noncontrolling interest and the warrants are recorded in other liabilities on the Company’s balance sheets. The put options for the Alloy redeemable common units begins in 2026. The put options for the Alaska Communications redeemable common units begin the earlier of a public offering or 2028. The Company calculates the fair value of the instruments using a market approach with Level 3 inputs. 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 long-term debt is estimated using Level 2 inputs. At March 31, 2023, the fair value of long-term debt, including the current portion, was $519.0 million and its book value was $512.8 million. At December 31, 2022, the fair value of long-term debt, including the current portion, was $473.7 million and its book value was $467.2 million. |
LONG-TERM DEBT
LONG-TERM DEBT | 3 Months Ended |
Mar. 31, 2023 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 8. LONG-TERM DEBT CoBank Credit Facility On April 10, 2019, the Company entered into a credit facility, with CoBank, ACB and a syndicate of other lenders (as amended, the “2019 CoBank Credit Facility”). The 2019 CoBank Credit Facility provides for a million under a swingline sub-facility. Approximately million of performance letters of credit have been issued and remain outstanding and undrawn as of March 31, 2023. The 2019 CoBank Credit Facility matures on April 10, 2024. Refer to Liquidity disclosure in Note 1 regarding the maturity of the facility. Amounts borrowed under the 2019 CoBank Credit Facility bear interest at a rate equal to, at the Company’s option, either (i) the London Interbank Offered Rate (“LIBOR”) plus an applicable margin ranging between 1.25% to 2.25% or (ii) a base rate plus an applicable margin ranging from 0.25% to 1.25% . Swingline loans bear interest at the base rate plus the applicable margin for base rate loans. The base rate is equal to the higher of (i) of the average daily unused portion of the 2019 CoBank Credit Facility over each calendar quarter. On November 7, 2022, the Company further amended the 2019 CoBank Credit Facility to allow for the incurrence of certain indebtedness related to payment guarantees in connection with its Replace and Remove project. On December 28, 2022, the Company further amended the 2019 CoBank Credit Facility, effective November 7, 2022, to allow for certain transactions contemplated with the Sacred Wind Transaction. The 2019 CoBank 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 limiting additional indebtedness, liens, guaranties, mergers and consolidations, substantial asset sales, investments and loans, sale and leasebacks, transactions with affiliates and fundamental changes. The Company’s investments in “unrestricted” subsidiaries and certain dividend payments to our stockholders are not limited unless the Total Net Leverage Ratio is equal to or greater than to 1.0. The Total Net Leverage Ratio is measured each fiscal quarter and is required to be less than or equal to to 1.0. In the event of a Qualifying Acquisition (as defined in the 2019 CoBank Credit Facility), the Total Net Leverage Ratio increases to to 1.0 for the subsequent three fiscal quarters. The 2019 CoBank Credit Facility also provides for the incurrence by the Company of incremental term loan facilities, when combined with increases to revolving loan commitments, in an aggregate amount not to exceed $200 million (the “Accordion”). Amounts borrowed under the Accordion are also subject to proforma compliance with a net leverage ratio financial covenant. As of March 31, 2023, the Company was in compliance with all of the financial covenants, had $122.0 million outstanding and $54.0 million of availability in connection with the 2019 CoBank Credit Facility. There are no outstanding interest rate hedge agreements under the 2019 CoBank Credit Facility as of March 31, 2023. Letter of Credit Facility On November 14, 2022, the Company entered into a General Agreement of Indemnity to issue performance Standby Letters of Credit on behalf of the Company and its subsidiaries. As of March 31, 2023, Alaska Credit Facility On July 22, 2021, Alaska Communications entered into a Credit Agreement (the “Alaska Credit Facility”) with Fifth Third Bank, National Association, as Administrative Agent, and a syndicate of lenders to provide a $35.0 million revolving facility (the “Alaska Revolving Facility”) and a $210.0 million initial term loan facility (the “Alaska Term Loan”). On December 23, 2022, Alaska Communications entered into a First Amendment Agreement (the “ACS Amendment’). The ACS Amendment amends the Alaska Credit Facility to increase its Revolving Credit Commitment from $35.0 million to $75.0 million and Term Loan Commitment from $210 million to $230 million. As a part of the transaction, the Term Loan commitment was fully funded as the outstanding Revolving Credit Commitment balance was transferred. As of March 31, 2023, Alaska Communications had drawn $17.0 million on its Revolving Credit Commitment and had $58.0 million is available to draw. The Term Loan balance was $230.0 million and principal payments commence in the fourth quarter of 2023. Both facilities mature on July 22, 2026 In addition to the above changes, the ACS Amendment replaced the calculation of interest from an applicable margin applied to LIBOR with the same applicable margin applied to the Secured Overnight Financing Rate (“SOFR”) plus a 10-basis point adjustment. The Company capitalized $7.3 million of fees associated with the Alaska Credit Facility which are being amortized over the life of the debt and $5.0 million were unamortized as of March 31, 2023. The Alaska Credit Facility also provides for incremental facilities up to an aggregate principal amount of the greater of $70.0 million and Alaska Communications’ trailing twelve-month Consolidated EBITDA (as defined in the Alaska Credit Facility). The key terms and conditions of the Alaska Credit Facility include the following: ● Amounts outstanding bear an interest rate of the forward-looking SOFR rate with a one month interest period, plus the SOFR Spread Adjustment of 10 basis points, plus a margin ranging from 3.00% to 4.00% based on Alaska Communications’ Consolidated Total Net Leverage Ratio (as defined in the Credit Agreement) or an alternate base rate may be selected at a margin that is 1% lower than the counterpart SOFR margin; ● Principal repayments are due quarterly commencing in the fourth quarter of 2023 in quarterly amounts as follows: from the fourth quarter of 2023 through the third quarter of 2024, $1.4 million; and from the fourth quarter of 2024 through the third quarter of 2026, $2.9 million. The remaining unpaid balance is due on the final maturity date; ● Alaska Communications is required to maintain financial ratios as defined in the Alaska Credit Facility, including (a) a maximum Consolidated Net Total Leverage Ratio of 4.00 to 1, stepping down to 3.75 to 1 beginning with the second quarter of 2024; and (b) a minimum Consolidated Fixed Charge Coverage Ratio of not less than 1.25 to 1; and ● The Alaska Credit Facility is non-recourse to the Company and is secured by substantially all of the personal property and certain material real property owned by Alaska Communications. Alaska Communication’s interest rate swap, which had been designated as a cash flow hedge with an interest rate of 1.6735% , expired on June 30, 2022. As of March 31, 2023, there are Alaska Term Facility On June 15, 2022, Alaska Communications Systems Holdings, the parent company of Alaska Communications, entered a secured lending arrangement with Bristol Bay Industrial, LLC. (the “Alaska Term Facility”). The Alaska Term Facility provides for a secured delayed draw term loan in an aggregate principal amount of up to $7.5 million and the proceeds may be used to pay certain invoices from a contractor for work performed in connection with a fiber build. Interest on the Alaska Term Facility accrues at a fixed rate of 4.0% and is payable commencing on March 31, 2023. Scheduled quarterly payments of principal commenced on March 31, 2023. The Alaska Term Facility matures on June 30, 2024. The Alaska Term Facility contains events of default customary for facilities of this type. As of March 31, 2023, the Company had $7.1 million outstanding and no available borrowings under the Alaska Term Facility. FirstNet Receivables Credit Facility On March 26, 2020, Commnet Finance, a wholly owned subsidiary of Commnet Wireless, entered into a receivables credit facility with the Company, Commnet Wireless, and CoBank, ACB (the “Receivables Credit Facility”). The Receivables Credit Facility provides for a senior secured delayed draw term loan in an aggregate principal amount of up to $75.0 million and the proceeds may be used to acquire certain receivables from Commnet Wireless. The receivables to be financed and sold under the Receivables Credit Facility, which provide the loan security, relate to the obligations of AT&T under the FirstNet Agreement. On December 23, 2022, CoBank amended the Receivables Credit Facility and extended the delayed draw period to December 31, 2023. The maturity date for each loan will be set by CoBank and will match the weighted average maturity of the certain receivables financed. Interest on the loans accrues at a fixed annual interest rate to be quoted by CoBank. The Receivables Credit Facility contains customary events of termination, representations and warranties, affirmative and negative covenants and events of default customary for facilities of this type. As of March 31, 2023, the Company had $48.7 million outstanding, of which $6.6 million was current, and $18.0 million of availability under the Receivables Credit Facility. The Company capitalized GTT Credit Facilities On September 5, 2022, GTT received approval from Republic Bank (Guyana) Limited for a $2.9 million term facility and a $5.7 million overdraft facility (the “GTT Credit Facilities”) subject to the approval from the Minister of Finance at the Bank of Guyana. Such approval from the Minister of Finance was received during the quarter ended March 31, 2023. The GTT Credit Facilities are secured by real estate assets and carry a fixed interest rate of 7.5% which will be reviewed by the bank from time to time and subject to change at the bank’s discretion. The term facility is repayable over five years in equal monthly installments of principal and interest, commencing one month after funds are advanced. The overdraft facility will expire on October 11, 2023. As of March 31, 2023, $3.6 million was outstanding on the overdraft facility and there were no outstanding amounts under the term facility. Sacred Wind Term Debt In connection with the Sacred Wind Transaction completed on November 7, 2022, the Company assumed $31.6 million of term debt (the “Sacred Wind Term Debt”) with the United States of America acting through the Administrator of the Rural Utilities Service (“RUS”). The loan agreements are dated as of October 23, 2006 and March 17, 2016. RUS provides financial assistance in the form of loans under the Rural Electrification Act of 1936 to furnish or improve telecommunications and/or broadband services in rural areas. The Sacred Wind Term Debt is secured by substantially all assets of Sacred Wind and an underlying mortgage to the United States of America. These mortgage notes are to be repaid in equal monthly installments covering principal and interest beginning after the date of issue and expiring by 2035. The Sacred Wind Term Debt contains certain restrictions on the declaration or payment of dividends, redemption of capital stock or investment in affiliated companies without the consent by the RUS noteholders. The agreements also contain a financial covenant which Sacred Wind was not in compliance with as of December 31, 2021. Sacred Wind submitted a corrective action plan to comply with the financial covenant as of December 31, 2025. On May 5, 2022, Sacred Wind’s corrective action plan was accepted by the RUS. As of March 31, 2023, the Company was in compliance with that corrective action plan. As of March 31, 2023, $30.6 million was outstanding under the Sacred Wind Term Debt. Of that amount, Viya Debt The Company, and certain of its subsidiaries, have entered into a $60.0 million loan agreement (the “Viya Debt”) with Rural Telephone Finance Cooperative (“RTFC”). The Viya Debt agreement contains customary representations, warranties and affirmative and negative covenants (including limitations on additional debt, guaranties, sale of assets and liens) and a financial covenant that limits the maximum ratio of indebtedness to annual operating cash flow to 3.5 to 1.0 (the “Net Leverage Ratio”). This covenant is tested on an annual basis at the end of each fiscal year. Interest is paid quarterly at a fixed rate of 4.0% per annum and principal repayment is not required until maturity on July 1, 2026. Prepayment of the Viya Debt may be subject to a fee under certain circumstances. The debt is secured by certain assets of our Viya subsidiaries and is guaranteed by us. The Company paid a fee of $0.9 million in 2016 to lock the interest rate at 4% per annum over the term of the Viya Debt. The fee was recorded as a reduction to the Viya Debt carrying amount and is being amortized over the life of the loan. As of March 31, 2023, $60.0 million of the Viya Debt remained outstanding and $0.3 million of the rate lock fee was unamortized. On May 5, 2022, RTFC agreed to amend the Net Leverage Ratio to 7.0 to 1.0 through the maturity date of July 1, 2026. The Ratio is tested annually and the Company was in compliance with the Net Leverage Ratio as of December 31, 2022. One Communications Debt The Company had an outstanding loan from HSBC Bank Bermuda Limited (the “One Communications Debt”) which matured and was repaid in full on December 22, 2022. This loan bore interest at the one-month LIBOR plus a margin ranging between 2.5% to 2.75% per annum paid quarterly. Debt Maturity The table below summarizes the annual maturities of the Company’s debt instruments (amounts in thousands). Customer US International Total Receivable Telecom Telecom Debt Credit Facility 2023 (excluding the three months ended March 31, 2023) $ 4,998 $ 3,553 $ 8,551 $ 4,904 2024 138,536 — 138,536 6,787 2025 14,969 — 14,969 7,083 2026 230,469 60,000 290,469 7,393 2027 3,723 — 3,723 7,718 Thereafter 14,028 — 14,028 14,794 Total 406,723 63,553 470,276 48,679 Debt Discounts (5,277) (318) (5,595) (572) Book Value 401,446 63,235 464,681 48,107 |
GOVERNMENT SUPPORT AND SPECTRUM
GOVERNMENT SUPPORT AND SPECTRUM MATTERS | 3 Months Ended |
Mar. 31, 2023 | |
GOVERNMENT SUPPORT AND SPECTRUM MATTERS | |
GOVERNMENT SUPPORT AND SPECTRUM MATTERS | 9. GOVERNMENT SUPPORT AND SPECTRUM MATTERS Universal Service Fund and Connect America Fund Phase II Programs The Company recognizes revenue from several government funded programs including the Universal Service Fund (“USF”), a subsidy program managed by the Federal Communications Commission (“FCC”), the Alaska Universal Service Fund (“AUSF”), a similar program managed by the Regulatory Commission of Alaska (the “RCA”), and the Emergency Connectivity Fund (“ECF”), a program to help schools and libraries support remote learning in underserved communities. USF funds are disbursed to telecommunication providers through four programs: the High Cost Program; the Low Income Program (“Lifeline Program”); the Schools and Libraries Program (“E-Rate Program”); and the Rural Health Care Support Program. The Company also recognizes revenue from the Connect America Fund Phase II program (“CAF II”) which offers subsidies to carriers to expand broadband coverage in designated areas. Under CAF II, the Company’s US Telecom segment will receive an aggregate of $27.7 million annually through December 2025 and an aggregate of $8.0 million annually from January 2026 through July 2028. All of the programs are subject to certain operational and reporting compliance requirements. The Company believes it is in compliance with these requirements as of March 31, 2023. Revenue recognized from the USF and CAFII programs is recognized as revenue from government grants. Revenue from other programs is recognized in accordance with ASC 606. RDOF (“Rural Digital Opportunities Fund”) The Company expects to receive approximately $22.7 million over 10 years to provide broadband and voice coverage to over 10,000 households in the United States (not including Alaska) under the 2020 Rural Digital Opportunity Fund Phase I Auction (“RDOF”). Revenue recognized from the RDOF program is recognized as revenue from government grants. The Company recorded the amounts below as communication services revenue for the reported periods: Three months ended March 31, 2023 US Telecom International Telecom Total High cost support $ 2,494 $ 1,397 $ 3,891 CAF II 6,815 — 6,815 RDOF 608 — 608 Other Programs 15,660 4 15,664 Total $ 25,577 $ 1,401 $ 26,978 Three months ended March 31, 2022 US Telecom International Telecom Total High cost support $ 1,056 $ 2,761 $ 3,817 CAF II 6,822 — 6,822 Other Programs 5,554 — 5,554 Total $ 13,432 $ 2,761 $ 16,193 In 2018, the FCC initiated a proceeding to replace the High Cost Program support received by Viya in the US Virgin Islands with a new Connect USVI Fund. On November 16, 2020, the FCC announced that Viya was not the recipient of the Connect USVI Fund award and authorized funding to be issued to the new awardee in June 2021. Pursuant to the terms of the program and effective in July 2021, Viya’s annual USF support was reduced from $16.4 million to $10.9 million. In July 2022, this support was reduced to $5.5 million for the annual period through June 2023. In April of 2023, the FCC issued an order extending the high cost support in the US Virgin Islands at the current million per year received from July 2023 through December 31, 2025. In connection with this order, the FCC requires that the Company maintain its current footprint for voice and broadband services in the US Virgin Islands. Construction Grants The Company has also been awarded construction grants to build network connectivity for eligible communities. The funding of these grants, used to reimburse the Company for its construction costs, is distributed upon completion of a project. Completion deadlines begin in June 2023 and once these projects are constructed, the Company is obligated to provide service to the participants. The Company expects to meet all requirements associated with these grants. A roll forward of the Company’s grant awards is below (in thousands). Amount Grants awarded, December 31, 2022 $ 80,197 New grants 4,364 Grants awarded, March 31, 2023 $ 84,561 In addition, the Company partners with tribal governments to obtain grants under the Tribal Broadband Connectivity Program ("TBCP"). The TBCP is a program administered by the National Telecommunications and Information Administration to deploy broadband connectivity on tribal lands. The Company was identified as a sub recipient of TBCP grants totaling $145.5 million as of March 31, 2023. Replace and Remove Program On July 15, 2022, the Company was notified that it was an approved participant in the Federal Communication Commission’s Secure and Trusted Communications Networks Reimbursement Program (the “Replace and Remove Program”), designed to reimburse providers of communications services for reasonable costs incurred in the required removal, replacement, and disposal of covered communications equipment or services, that have been deemed to pose a national security risk, from their networks. Pursuant to the Replace and Remove Program, the Company was allocated up to approximately million in reimbursement amounts to cover documented and approved costs to remove and securely destroy all ZTE communications equipment and services in its U.S. networks and replace such equipment. The Replace and Remove Program requires that the Company complete its first request for reimbursement for services performed under the program no later than July 14, 2023, and that it complete the project no later than one year from submitting its initial reimbursement request. The Company anticipates that it will be able to meet the deadlines and requirements of the program. At March 31, 2023, the Company established a receivable for |
RETIREMENT PLANS
RETIREMENT PLANS | 3 Months Ended |
Mar. 31, 2023 | |
RETIREMENT PLANS | |
RETIREMENT PLANS | 10. RETIREMENT PLANS Multi-employer Defined Benefit Plan Pension benefits for substantially all of the Company’s Alaska-based employees are provided through the Alaska Electrical Pension Fund (“AEPF”). The Company pays a contractual hourly amount based on employee classification or base compensation to the AEPF. As a multi-employer defined benefit plan, the accumulated benefits and plan assets are not determined for, or allocated separately to, the individual employer. This plan was not in endangered or critical status during the plan year. Defined Benefit Plan The Company has noncontributory defined benefit pension and noncontributory defined medical, dental, vision, and life benefit plans for eligible employees who meet certain eligibility criteria. The majority of benefits under the plans are frozen and the plans no longer allow new participants to join. The Company recorded the net periodic benefit cost identified below (in thousands): Three months ended March 31, 2023 March 31, 2022 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Operating expense Service cost $ 38 $ 31 $ 57 $ 36 Non-operating expense Interest cost 593 35 565 33 Expected return on plan assets (953) — (925) — Settlements 369 — — — Net periodic pension expense (benefit) $ 47 $ 66 $ (303) $ 69 The Company was not required to make contributions to its pension plans during the three months ended March 31, 2023 and 2022. However, the Company periodically evaluates whether to make discretionary contributions. The Company funds its postretirement benefit plans as claims are made and did not make contributions to its pension plans during the three months ended March 31, 2023 and 2022. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2023 | |
INCOME TAXES | |
INCOME TAXES | 11. INCOME TAXES The Company’s effective tax rate for the three months ended March 31, 2023 and 2022 was 9.5% and 296.7%, respectively. The Company recorded an income tax benefit of $0.7 million in relation to a pretax loss of $7.8 million for the three months ended March 31, 2023. The effective tax rate for the three months ended March 31, 2023 was primarily impacted by the following items (i) the mix of income generated among the jurisdictions in which the Company operates, (ii) a net increase related to valuation allowances placed on certain deferred tax assets and (iii) discrete items including The Company recorded an income tax provision of $ 3.0 million in relation to income before taxes of $1.0 million for the three months ended March 31, 2022. The effective tax rate for the three months ended March 31, 2022 was primarily impacted by the following items: (i) a $ 0.5 million net increase of unrecognized tax positions recognized discretely, (ii) a $ 2.1 million net expense recognized discretely to record a valuation allowance on certain deferred tax assets that are not expected to be realizable based on the weight of positive and negative evidence, and (iii) the mix of income generated among the jurisdictions in which the Company operates. The Company’s effective tax rate is based upon estimated income before provision for income taxes for the year, composition of the income in different countries, and adjustments, if any, in the applicable quarterly periods for potential tax consequences, benefits and/or resolutions of tax contingencies. The Company’s consolidated tax rate will continue to be impacted by any transactional or one-time items in the future and the mix of income in any given year generated among the jurisdictions in which the Company operates. While the Company believes it has adequately provided for all tax positions, amounts asserted by taxing authorities could materially differ from the Company’s accrued positions as a result of uncertain and complex applications of tax law and regulations. Additionally, the recognition and measurement of certain tax benefits include estimates and judgments by management. Accordingly, the Company could record additional provisions or benefits for US federal, state, and foreign tax matters in future periods as new information becomes available. |
EARNINGS PER SHARE AND REDEEMAB
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS | 3 Months Ended |
Mar. 31, 2023 | |
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS | |
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS | 12. EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS Earnings Per Share The following table reconciles the numerator and denominator in the computations of basic and diluted earnings per share (in thousands): Three months ended March 31, 2023 2022 Numerator: Net Loss attributable to ATN International, Inc. stockholders- Basic (5,885) (948) Less: Preferred dividends (1,045) (1,116) Net Loss attributable to ATN International, Inc. common stockholders- Diluted $ (6,930) $ (2,064) Denominator: Weighted-average shares outstanding- Basic 15,768 15,708 Effective of dilutive securities: Stock options, restricted stock units and performance stock units — — Weighted-average shares outstanding- Diluted 15,768 15,708 Redeemable Noncontrolling Interests The common units contain put options allowing the holder to sell at a future date, the common units to a subsidiary of the Company at the then fair market value. The common units participate in the earnings and losses of the subsidiaries and are allocated their applicable share of earning and losses. After the allocation of earnings and losses, the Company estimates the fair value of the common units and adjusts the book value of the common units to that estimated fair value. The preferred units contain put options allowing the holder to sell at a future date, the preferred units to a subsidiary of the Company at a fixed price equal to face value of the units plus unpaid dividends. The preferred units hold a distribution preference over common units and carry a fixed dividend rate. For the three months ended March 31, 2023 and 2022, the Company allocated losses of $2.8 million and $1.1 million, respectively, to the redeemable common units representing their proportionate share of operating losses. The Company then compared the book value of the common units to the fair value and the fair value exceeded the book value. As a result, the book value was increased by $2.5 million during the three months ended March 31, 2023. The following table provides a roll forward of the activity related to the Company’s redeemable noncontrolling interests for the three months ended March 31, 2023 and 2022: Redeemable Preferred Units Redeemable Common Units Total Redeemable Noncontrolling Interests Balance, December 31, 2022 $ 55,152 $ 37,317 $ 92,469 Accrued preferred dividend 1,045 — 1,045 Allocated net loss — (2,821) (2,821) Change in fair value — 2,530 2,530 Balance, March 31, 2023 $ 56,197 $ 37,026 $ 93,223 Redeemable Preferred Units Redeemable Common Units Total Redeemable Noncontrolling Interests Balance, December 31, 2021 $ 50,296 $ 22,640 $ 72,936 Accrued preferred dividend 1,116 — 1,116 Allocated net loss — (1,092) (1,092) Change in fair value — 1,092 1,092 Balance, March 31, 2022 $ 51,412 $ 22,640 $ 74,052 |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2023 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | 13. SEGMENT REPORTING The Company has the following two reportable and operating segments: i) International Telecom and ii) US Telecom. The following tables provide information for each operating segment (in thousands): For the Three Months Ended March 31, 2023 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,575 $ 172 $ — $ 3,747 Mobility - Consumer 22,532 987 — 23,519 Total Mobility 26,107 1,159 — 27,266 Fixed - Business 17,113 36,320 — 53,433 Fixed - Consumer 41,778 22,582 — 64,360 Total Fixed 58,891 58,902 — 117,793 Carrier Services 3,690 32,084 — 35,774 Other 400 75 — 475 Total Communication Services Revenue 89,088 92,220 — 181,308 Construction — 590 — 590 Other Managed Services 1,320 2,556 — 3,876 Total other revenue 1,320 2,556 — 3,876 Total Revenue 90,408 95,367 — 185,774 Depreciation and amortization 14,186 21,487 731 36,404 Amortization of intangibles from acquisitions 380 2,867 — 3,247 Non-cash stock-based compensation 67 77 1,634 1,778 Operating income (loss) 13,825 (4,342) (8,847) 636 For the Three Months Ended March 31, 2022 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,616 $ 374 $ — $ 3,990 Mobility - Consumer 19,970 1,456 — 21,426 Total Mobility 23,586 1,830 — 25,416 Fixed - Business 17,254 27,145 — 44,399 Fixed - Consumer 41,093 18,968 — 60,061 Total Fixed 58,347 46,113 — 104,460 Carrier Services 3,402 32,989 — 36,391 Other 276 — — 276 Total Communication Services Revenue 85,611 80,932 — 166,543 Construction — 1,987 — 1,987 Other Managed Services 1,176 2,313 — 3,489 Total Other Revenue 1,176 2,313 — 3,489 Total Revenue 86,787 85,232 — 172,019 Depreciation 13,897 18,442 953 33,292 Amortization of intangibles from acquisitions 418 2,840 — 3,258 Non-cash stock-based compensation 60 90 1,311 1,461 Operating income (loss) 11,802 (4,635) (7,059) 108 Selected balance sheet data for each of the Company’s segments as of March 31, 2023 and December 31, 2022 consists of the following (in thousands): International US Corporate and Telecom Telecom Other (1) Consolidated March 31, 2023 Cash, cash equivalents, and short-term investments $ 30,664 $ 19,433 $ 6,219 $ 56,316 Total current assets 113,711 110,108 7,733 231,552 Fixed assets, net 468,961 580,633 6,769 1,056,363 Goodwill 4,835 35,269 — 40,104 Total assets 658,621 959,395 81,999 1,700,015 Total current liabilities 88,967 96,844 19,573 205,384 Total debt 63,235 327,553 122,000 512,788 December 31, 2022 Cash, cash equivalents, and short-term investments $ 25,345 $ 22,679 $ 6,936 $ 54,960 Total current assets 105,324 116,038 8,326 229,688 Fixed assets, net 462,447 585,969 7,538 1,055,954 Goodwill 4,835 35,269 — 40,104 Total assets 643,664 980,543 83,662 1,707,869 Total current liabilities 86,738 119,755 26,687 233,180 Total debt 59,659 308,589 99,000 467,248 Capital Expenditures International US Corporate and Three months ended March 31, Telecom Telecom Other (1) Consolidated 2023 $ 21,464 $ 31,261 $ — $ 52,725 2022 15,170 19,095 203 34,468 (1) Corporate and other items refer to corporate overhead costs and consolidating adjustments |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 14. 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. Historically, the Company’s subsidiary, GTT, has been subject to other long-standing litigation proceedings and disputes in Guyana that have not yet been resolved. 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 matters currently pending will not have a material adverse effect on the Company’s financial position or results of operations. Beginning in 2006, the National Frequency Management Unit (now the Telecommunications Agency , or the “NFMU/TA”) and GTT have been engaged in discussions regarding the amount of and methodology for calculation of spectrum fees payable by GTT in Guyana. Since that time, GTT has made payments of, undisputed spectrum fees as amounts invoiced by the NFMU/TA. There have been limited further discussions on the subject of a revised spectrum fee methodology with the Telecommunications Agency and GTT awaits the determination of such fees. On May 8, 2009, a GTT competitor, Digicel, filed a lawsuit in Guyana challenging the legality of GTT’s exclusive license rights under Guyana’s constitution and GTT intervened in the suit in order to oppose Digicel’s claims. The case remains pending. The Company believes that any legal challenge to GTT’s exclusive license rights granted in 1990 is without merit and the Company continues to defend vigorously against such 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. 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 been consolidated with Digicel’s constitutional challenge described above, however, the Company cannot accurately predict at this time when the consolidated suit will reach a court of final determination. GTT is also involved in several legal claims regarding its tax filings with the Guyana Revenue Authority (the “GRA”) dating back to 1991 regarding the deductibility of intercompany advisory fees as well as other tax assessments. GTT’s position has been upheld by various High Court rulings made in its favor including most recently in December 2021, when an assessment relating to 2010-2016 was quashed and declared to have no legal effect. GTT has maintained that it has no unpaid corporation tax due to the GRA and that any liability GTT might be found to have with respect to the disputed tax assessments, as alleged by the GRA in the aggregate amount of On May 20, 2021, the Company was served with a notice of application for enforcement of a foreign judgment with respect to a matter brought by the Trinidad & Tobago Electric Commission (“TTEC”) in the High Court of Justice in the Republic of Trinidad and Tobago in August 2013 against GTT and other defendants, alleging breach of contract due to GTT’s failure to pay TTEC in connection with amounts alleged to be owed as reimbursement for cable repair costs. In December 2022, GTT settled this matter with TTEC. In February 2020, the Company’s Alaska Communications subsidiary received a draft audit report from USAC in connection with USAC’s inquiry into Alaska Communications’ funding requests under the Rural Health Care Support Program for certain customers for the time period of July 2012 through June 2017. The draft audit report alleges violations of the FCC’s rules for establishing rural rates and urban rates, the provisioning and billing of ineligible services and products, and violations of the FCC’s competitive bidding rules. Alaska Communications has provided USAC with extensive comments in response to its draft audit report seeking correction of numerous factual and legal errors that it believed it had identified. As a result of these conversations and comments being submitted by Alaska Communications, USAC’s auditors may revise their findings, including the amounts they recommend USAC seek to recover. USAC’s auditors are expected to issue a final audit report incorporating Alaska Communications’ responses that will be sent to USAC’s Rural Health Care Division to review and determine if corrective action would be appropriate. In the event that the Company disagrees with USAC’s final audit report, the Company can appeal that decision to USAC’s Rural Health Care Division and/or the FCC. At this time, the Company cannot predict the contents or timing of the final USAC audit report, the outcome of the audit or the impact on the Company’s business, financial condition, results of operations, or liquidity and may require certain undertakings in addition to any proposed financial settlement. Alaska Communications also received a Letter of Inquiry on March 18, 2018, and subsequent follow up information requests, from the FCC Enforcement Bureau requesting historical information regarding Alaska Communications’ participation in the FCC’s Rural Health Care Support Program. The Company is engaged in discussions with the FCC’s Enforcement Bureau and will continue to work constructively to provide it the information it is seeking. Any adverse outcome with respect to the FCC Enforcement Bureau’s inquiry may have an adverse impact the Company’s business, financial condition, results of operations, or liquidity and may require certain undertakings in addition to any proposed financial settlement. With respect to all of the foregoing matters, the Company believes that some adverse outcome is probable and has accordingly accrued $15.3 million as of March 31, 2023 for these and other potential liabilities arising in various claims, legal actions and regulatory proceedings arising in the ordinary course of business. The Company also faces contingencies that are reasonably possible to occur that cannot currently be estimated. It is the Company’s policy to expense costs associated with loss contingencies, including any related legal fees, as they are incurred. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 15. SUBSEQUENT EVENTS Verizon Carrier Managed Services Agreement On May 10, 2023, Commnet Wireless, LLC (“Commnet”), a subsidiary of ATN International, Inc. (the “Company”) entered into a Carrier Managed Services Master Agreement (the “Agreement”) with Cellco Partnership d/b/a Verizon Wireless (“Verizon”), pursuant to which Commnet will provide a variety of network, infrastructure and technical services that will help deliver next generation wireless services to Verizon’s subscribers in Commnet’s current operating area in the southwestern United States. In connection with the Agreement, Commnet has also agreed to provide Verizon with high capacity transport in its coverage area. Verizon will continue to use Commnet’s wireless communications network for roaming services at a fixed rate per site during the build period until such time as upgrades to the network to meet certain performance service level agreements for both RAN operations and transport are met. Verizon will pay Commnet an aggregate of an estimated approximately $200 million in total amounts for both non-recurring payments for upgrades and construction to its current RAN and transport network and in monthly recurring charges over the initial Commitment Period. The Agreement may be terminated at any time upon the mutual written consent of Commnet and Verizon. In addition, Verizon may terminate the Agreement upon the occurrence of certain events, including failure to meet certain milestones or completion dates with respect to network coverage, failure to meet certain SLAs with respect to the ongoing services, the declaration of a bankruptcy event by Commnet and breach of any other material terms of the Agreement. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial information included herein is unaudited; however, the Company believes such information and the disclosures herein are adequate to make the information presented not misleading and reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company’s financial position and results of operations for the periods described therein. The year-end condensed balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. Results of interim periods may not be indicative of results for the full year. These condensed consolidated financial statements and related notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 15, 2023. The condensed consolidated financial statements include the accounts of the Company, its subsidiaries in which the Company holds controlling interests 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. |
ORGANIZATION AND BUSINESS OPE_2
ORGANIZATION AND BUSINESS OPERATIONS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
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 | Segment Services Markets Tradenames International Telecom Mobility Services Bermuda, Guyana, US Virgin Islands One, GTT, Viya Fixed Services Bermuda, Cayman Islands, Guyana, US Virgin Islands One, Logic, GTT, Viya Carrier Services Bermuda, Guyana, US Virgin Islands One, GTT, Viya Managed Services Bermuda, Cayman Islands, US Virgin Islands, Guyana Fireminds, One, Logic, GTT, Viya US Telecom Mobility Services United States (rural markets) Choice, Choice NTUA Wireless Fixed Services United States Alaska Communications, Commnet, Choice, Choice NTUA Wireless, Sacred Wind Communications, Ethos Carrier Services United States Alaska Communications, Commnet, Essextel, Sacred Wind Communications Managed Services United States Alaska Communications, Choice |
REVENUE RECOGNITION AND RECEI_2
REVENUE RECOGNITION AND RECEIVABLES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
REVENUE RECOGNITION AND RECEIVABLES | |
Summary of revenues | Three months ended March 31, 2023 March 31, 2022 Services transferred over time US Telecom $ 81,072 $ 72,290 International Telecom 85,680 81,302 Total 166,752 153,592 Goods and services transferred at a point in time US Telecom 2,546 3,597 International Telecom 3,259 2,723 Total 5,805 6,320 Total revenue accounted for under ASC 606 172,557 159,912 |
Summary of contracts asset and liabilities | Contract assets and liabilities consisted of the following (amounts in thousands): March 31, 2023 December 31, 2022 $ Change % Change Contract asset – current $ 3,010 $ 2,932 $ 78 3 % Contract asset – noncurrent 3,734 3,775 (41) (1) % Contract liability – current (26,086) (27,284) 1,198 4 % Contract liability – noncurrent (70,444) (72,543) 2,099 3 % Net contract liability $ (89,786) $ (93,120) $ 3,334 4 % |
Schedule of activity in allowances for credit losses | Three months ended March 31, 2023 March 31, 2022 Balance at beginning of period $ 15,171 $ 13,885 Current period provision for expected losses 1,378 1,913 Write-offs charged against the allowance (591) (862) Recoveries collected 74 108 Balance at end of period $ 16,032 $ 15,044 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
LEASES | |
Summary of components of lease expense | The components of lease expense were as follows (in thousands): Three months ended March 31, 2023 March 31, 2022 Operating lease cost: Operating lease cost $ 5,981 $ 6,142 Short-term lease cost 677 509 Variable lease cost 662 804 Total operating lease cost $ 7,320 $ 7,455 Finance lease cost: Amortization of right-of-use asset $ 699 $ 797 Variable costs 203 248 Interest costs 84 102 Total finance lease cost $ 986 $ 1,147 |
Summary of weighted-average remaining lease term and discount rate | March 31, 2023 December 31, 2022 Weighted-average remaining lease term Operating leases 13.1 years 12.4 years Financing leases 9.3 years 9.3 years Weighted-average discount rate Operating leases 6.1% 6.0% Financing leases 6.9% 6.7% |
Summary of maturities of operating lease liabilities | Maturities of lease liabilities as of March 31, 2023 were as follows (in thousands): Operating Leases Financing Leases 2023 (excluding the three months ended March 31, 2023) 12,977 1,045 2024 17,023 1,240 2025 13,897 972 2026 9,771 504 2027 7,708 495 Thereafter 79,134 2,651 Total lease payments 140,510 6,907 Less imputed interest (53,450) (1,822) Total $ 87,060 $ 5,085 Maturities of lease liabilities as of December 31, 2022 were as follows (in thousands): Operating Leases Financing Leases 2023 $ 19,417 $ 1,403 2024 17,836 1,342 2025 14,805 978 2026 10,505 504 2027 8,096 495 Thereafter 76,452 2,651 Total lease payments 147,111 7,373 Less imputed interest (53,794) (1,914) Total $ 93,317 $ 5,459 |
Summary of maturities of finance lease liabilities | Operating Leases Financing Leases 2023 (excluding the three months ended March 31, 2023) 12,977 1,045 2024 17,023 1,240 2025 13,897 972 2026 9,771 504 2027 7,708 495 Thereafter 79,134 2,651 Total lease payments 140,510 6,907 Less imputed interest (53,450) (1,822) Total $ 87,060 $ 5,085 Operating Leases Financing Leases 2023 $ 19,417 $ 1,403 2024 17,836 1,342 2025 14,805 978 2026 10,505 504 2027 8,096 495 Thereafter 76,452 2,651 Total lease payments 147,111 7,373 Less imputed interest (53,794) (1,914) Total $ 93,317 $ 5,459 |
Schedule of maturities of future undiscounted lease payments | 2023 (excluding the three months ended March 31, 2023) $ 4,609 2024 5,891 2025 5,716 2026 5,410 2027 4,267 Thereafter 14,360 Total future lease payments $ 40,253 |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
ACQUISITIONS AND DISPOSITIONS | |
Schedule of preliminary allocation of the total consideration transferred to the acquired assets and assumed liabilities | The table below represents the purchase price allocation of the total consideration transferred to the acquired assets and assumed liabilities based on management’s estimate of their acquisition date fair values (amounts in thousands): Consideration Transferred $ 44,560 Preliminary purchase price allocation: Cash and cash equivalents 2,619 Restricted cash 6,747 Current assets 4,888 Operating lease right of use assets 989 Fixed assets 85,255 Intangible assets 1,232 Current liabilities (10,176) Lease liabilities (967) Deferred taxes (14,388) Debt (31,639) Net assets acquired $ 44,560 |
FAIR VALUE MEASUREMENTS AND I_2
FAIR VALUE MEASUREMENTS AND INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
FAIR VALUE MEASUREMENTS AND INVESTMENTS | |
Schedule of assets and liabilities of the entity measured at fair value on a recurring basis | Assets and liabilities of the Company measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 are summarized as follows (in thousands): March 31, 2023 Significant Other Quoted Prices in Unobservable Active Markets Inputs Description (Level 1) (Level 3) Total Short term investments $ 300 $ — $ 300 Other investments — 1,694 1,694 Alaska Communications redeemable common units — (22,266) (22,266) Alloy redeemable common units — (14,760) (14,760) Warrants on Alaska Communications redeemable common units — (654) (654) Total assets and liabilities measured at fair value $ 300 $ (35,986) $ (35,686) December 31, 2022 Significant Other Quoted Prices in Unobservable Active Markets Inputs Description (Level 1) (Level 3) Total Short term investments $ 300 $ — $ 300 Other investments — 1,616 1,616 Alaska Communications redeemable common units — (22,557) (22,557) Alloy redeemable common units — (14,760) (14,760) Warrants on Alaska Communications redeemable common units — (654) (654) Total assets and liabilities measured at fair value $ 300 $ (36,355) $ (36,055) |
Schedule of investments | Investments without a readily determinable fair value Fair value investments Equity investments Total Balance, December 31, 2022 $ 22,590 $ 1,616 $ 13,963 $ 38,169 Income recognized — 77 238 315 Contributions — — 630 630 Foreign currency gain — — 111 111 Balance, March 31, 2023 $ 22,590 $ 1,693 $ 14,942 $ 39,225 Balance, December 31, 2021 $ 17,820 $ 1,925 $ 28,699 $ 48,444 Income (loss) recognized — 99 (662) (563) Foreign currency gain — — 256 256 Gain recognized 4,770 — — 4,770 Balance, March 31, 2022 $ 22,590 $ 2,024 $ 28,293 $ 52,907 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
LONG-TERM DEBT | |
Schedule of future principal repayments annual maturities of the Company's debt instruments | The table below summarizes the annual maturities of the Company’s debt instruments (amounts in thousands). Customer US International Total Receivable Telecom Telecom Debt Credit Facility 2023 (excluding the three months ended March 31, 2023) $ 4,998 $ 3,553 $ 8,551 $ 4,904 2024 138,536 — 138,536 6,787 2025 14,969 — 14,969 7,083 2026 230,469 60,000 290,469 7,393 2027 3,723 — 3,723 7,718 Thereafter 14,028 — 14,028 14,794 Total 406,723 63,553 470,276 48,679 Debt Discounts (5,277) (318) (5,595) (572) Book Value 401,446 63,235 464,681 48,107 |
GOVERNMENT SUPPORT AND SPECTR_2
GOVERNMENT SUPPORT AND SPECTRUM MATTERS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | |
Summary of revenues | Three months ended March 31, 2023 March 31, 2022 Services transferred over time US Telecom $ 81,072 $ 72,290 International Telecom 85,680 81,302 Total 166,752 153,592 Goods and services transferred at a point in time US Telecom 2,546 3,597 International Telecom 3,259 2,723 Total 5,805 6,320 Total revenue accounted for under ASC 606 172,557 159,912 |
Network Connectivity for Eligible Communities | |
Disaggregation of Revenue [Line Items] | |
Schedule of grant funds | Amount Grants awarded, December 31, 2022 $ 80,197 New grants 4,364 Grants awarded, March 31, 2023 $ 84,561 |
Communication services | |
Disaggregation of Revenue [Line Items] | |
Summary of revenues | Three months ended March 31, 2023 US Telecom International Telecom Total High cost support $ 2,494 $ 1,397 $ 3,891 CAF II 6,815 — 6,815 RDOF 608 — 608 Other Programs 15,660 4 15,664 Total $ 25,577 $ 1,401 $ 26,978 Three months ended March 31, 2022 US Telecom International Telecom Total High cost support $ 1,056 $ 2,761 $ 3,817 CAF II 6,822 — 6,822 Other Programs 5,554 — 5,554 Total $ 13,432 $ 2,761 $ 16,193 |
RETIREMENT PLANS (Tables)
RETIREMENT PLANS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
RETIREMENT PLANS | |
Schedule of components of the plan's net periodic pension cost | The Company recorded the net periodic benefit cost identified below (in thousands): Three months ended March 31, 2023 March 31, 2022 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Operating expense Service cost $ 38 $ 31 $ 57 $ 36 Non-operating expense Interest cost 593 35 565 33 Expected return on plan assets (953) — (925) — Settlements 369 — — — Net periodic pension expense (benefit) $ 47 $ 66 $ (303) $ 69 |
EARNINGS PER SHARE AND REDEEM_2
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS | |
Schedule of computation of basic and diluted earnings per share | The following table reconciles the numerator and denominator in the computations of basic and diluted earnings per share (in thousands): Three months ended March 31, 2023 2022 Numerator: Net Loss attributable to ATN International, Inc. stockholders- Basic (5,885) (948) Less: Preferred dividends (1,045) (1,116) Net Loss attributable to ATN International, Inc. common stockholders- Diluted $ (6,930) $ (2,064) Denominator: Weighted-average shares outstanding- Basic 15,768 15,708 Effective of dilutive securities: Stock options, restricted stock units and performance stock units — — Weighted-average shares outstanding- Diluted 15,768 15,708 |
Schedule of rollforward activity related to the Company's redeemable noncontrolling interests | The following table provides a roll forward of the activity related to the Company’s redeemable noncontrolling interests for the three months ended March 31, 2023 and 2022: Redeemable Preferred Units Redeemable Common Units Total Redeemable Noncontrolling Interests Balance, December 31, 2022 $ 55,152 $ 37,317 $ 92,469 Accrued preferred dividend 1,045 — 1,045 Allocated net loss — (2,821) (2,821) Change in fair value — 2,530 2,530 Balance, March 31, 2023 $ 56,197 $ 37,026 $ 93,223 Redeemable Preferred Units Redeemable Common Units Total Redeemable Noncontrolling Interests Balance, December 31, 2021 $ 50,296 $ 22,640 $ 72,936 Accrued preferred dividend 1,116 — 1,116 Allocated net loss — (1,092) (1,092) Change in fair value — 1,092 1,092 Balance, March 31, 2022 $ 51,412 $ 22,640 $ 74,052 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
SEGMENT REPORTING | |
Schedule of information for each operating segment | The following tables provide information for each operating segment (in thousands): For the Three Months Ended March 31, 2023 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,575 $ 172 $ — $ 3,747 Mobility - Consumer 22,532 987 — 23,519 Total Mobility 26,107 1,159 — 27,266 Fixed - Business 17,113 36,320 — 53,433 Fixed - Consumer 41,778 22,582 — 64,360 Total Fixed 58,891 58,902 — 117,793 Carrier Services 3,690 32,084 — 35,774 Other 400 75 — 475 Total Communication Services Revenue 89,088 92,220 — 181,308 Construction — 590 — 590 Other Managed Services 1,320 2,556 — 3,876 Total other revenue 1,320 2,556 — 3,876 Total Revenue 90,408 95,367 — 185,774 Depreciation and amortization 14,186 21,487 731 36,404 Amortization of intangibles from acquisitions 380 2,867 — 3,247 Non-cash stock-based compensation 67 77 1,634 1,778 Operating income (loss) 13,825 (4,342) (8,847) 636 For the Three Months Ended March 31, 2022 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,616 $ 374 $ — $ 3,990 Mobility - Consumer 19,970 1,456 — 21,426 Total Mobility 23,586 1,830 — 25,416 Fixed - Business 17,254 27,145 — 44,399 Fixed - Consumer 41,093 18,968 — 60,061 Total Fixed 58,347 46,113 — 104,460 Carrier Services 3,402 32,989 — 36,391 Other 276 — — 276 Total Communication Services Revenue 85,611 80,932 — 166,543 Construction — 1,987 — 1,987 Other Managed Services 1,176 2,313 — 3,489 Total Other Revenue 1,176 2,313 — 3,489 Total Revenue 86,787 85,232 — 172,019 Depreciation 13,897 18,442 953 33,292 Amortization of intangibles from acquisitions 418 2,840 — 3,258 Non-cash stock-based compensation 60 90 1,311 1,461 Operating income (loss) 11,802 (4,635) (7,059) 108 |
Schedule of segment balance sheet data and capital expenditures | Selected balance sheet data for each of the Company’s segments as of March 31, 2023 and December 31, 2022 consists of the following (in thousands): International US Corporate and Telecom Telecom Other (1) Consolidated March 31, 2023 Cash, cash equivalents, and short-term investments $ 30,664 $ 19,433 $ 6,219 $ 56,316 Total current assets 113,711 110,108 7,733 231,552 Fixed assets, net 468,961 580,633 6,769 1,056,363 Goodwill 4,835 35,269 — 40,104 Total assets 658,621 959,395 81,999 1,700,015 Total current liabilities 88,967 96,844 19,573 205,384 Total debt 63,235 327,553 122,000 512,788 December 31, 2022 Cash, cash equivalents, and short-term investments $ 25,345 $ 22,679 $ 6,936 $ 54,960 Total current assets 105,324 116,038 8,326 229,688 Fixed assets, net 462,447 585,969 7,538 1,055,954 Goodwill 4,835 35,269 — 40,104 Total assets 643,664 980,543 83,662 1,707,869 Total current liabilities 86,738 119,755 26,687 233,180 Total debt 59,659 308,589 99,000 467,248 Capital Expenditures International US Corporate and Three months ended March 31, Telecom Telecom Other (1) Consolidated 2023 $ 21,464 $ 31,261 $ — $ 52,725 2022 15,170 19,095 203 34,468 (1) Corporate and other items refer to corporate overhead costs and consolidating adjustments |
ORGANIZATION AND BUSINESS OPE_3
ORGANIZATION AND BUSINESS OPERATIONS (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 USD ($) segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Line of Credit Facility [Line Items] | |||
Number of operating segments | segment | 2 | ||
Net cash provided by operating activities | $ 16,012 | $ 11,388 | $ 102,900 |
Cash and cash equivalents | 56,016 | 54,660 | |
Restricted cash | 4,961 | $ 5,068 | |
Credit facility | Revolver loan | |||
Line of Credit Facility [Line Items] | |||
Borrowings outstanding | $ 122,000 |
ORGANIZATION AND BUSINESS OPE_4
ORGANIZATION AND BUSINESS OPERATIONS - Restructuring Expenses (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring charge | $ 2,887 |
Repositioning of Wholesale Roaming Operations | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring charge | 2,900 |
Restructuring paid | 500 |
Gain on lease termination | 300 |
Restructuring expenses accrued | 2,700 |
Right of use assets terminated | 5,000 |
Lease liability terminated | $ 5,300 |
REVENUE RECOGNITION AND RECEI_3
REVENUE RECOGNITION AND RECEIVABLES - Timing of Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 172,557 | $ 159,912 |
Services transferred over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 166,752 | 153,592 |
Goods and services transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 5,805 | 6,320 |
Telecom | Services transferred over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 81,072 | 72,290 |
Telecom | Goods and services transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 2,546 | 3,597 |
International Telecom | Services transferred over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 85,680 | 81,302 |
International Telecom | Goods and services transferred at a point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 3,259 | $ 2,723 |
REVENUE RECOGNITION AND RECEI_4
REVENUE RECOGNITION AND RECEIVABLES - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Contract Assets and Liabilities | ||
Contract Asset - current | $ 3,010 | $ 2,932 |
Change in contract asset - current | $ 78 | |
% of change in contract asset - current | 3% | |
Contract Asset - noncurrent | $ 3,734 | 3,775 |
Change in contract asset - noncurrent | $ (41) | |
% of change in contract asset - noncurrent | (1.00%) | |
Contract liability- current | $ (26,086) | (27,284) |
Change in contract liabilities - current | $ 1,198 | |
% of change in contract liabilities - current | 4% | |
Contract liability- noncurrent | $ (70,444) | (72,543) |
Change in contract liabilities - noncurrent | $ 2,099 | |
% of change in contract liabilities - Noncurrent | 3% | |
Net contract liability | $ (89,786) | $ (93,120) |
Change in net contract liability | $ 3,334 | |
% of change in net contract liability | 4% | |
Revenue recognized related to contract liability | $ 14,800 | |
Amortization of contract assets | $ 700 | |
Retail revenue period for billing postpaid customers in advance | 1 month |
REVENUE RECOGNITION AND RECEI_5
REVENUE RECOGNITION AND RECEIVABLES - Contract Acquisition Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Contract Acquisition Costs | ||
Amortization of contract acquisition cost | $ 1.1 | $ 0.8 |
Prepayments and other current assets | ||
Contract Acquisition Costs | ||
Short-term contract acquisition costs | $ 9 |
REVENUE RECOGNITION AND RECEI_6
REVENUE RECOGNITION AND RECEIVABLES - Remaining Performance Obligations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Revenue Recognition | ||
Transaction price allocated to unsatisfied performance obligations | $ 312 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | ||
Revenue Recognition | ||
Transaction price allocated to unsatisfied performance obligations | $ 286 | |
Percentage of performance obligations to be satisfied | 50% | |
Period to satisfy the remaining performance obligations and recognize the transaction price | 24 months |
REVENUE RECOGNITION AND RECEI_7
REVENUE RECOGNITION AND RECEIVABLES - Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accounts Receivable | ||
Gross accounts receivable | $ 152,300 | $ 154,500 |
Allowance for credit loss | 16,000 | 15,200 |
Customer receivable | 51,800 | 52,500 |
Customer receivable, current | 6,083 | 5,803 |
Customer receivable - long term | $ 45,681 | $ 46,706 |
REVENUE RECOGNITION AND RECEI_8
REVENUE RECOGNITION AND RECEIVABLES - Allowance for Credit Losses Rollforward - (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
REVENUE RECOGNITION AND RECEIVABLES | ||
Beginning Balance | $ 15,171 | $ 13,885 |
Current period provision for expected losses | 1,378 | 1,913 |
Write-offs charged against the allowance | (591) | (862) |
Recoveries collected | 74 | 108 |
Ending Balance | $ 16,032 | $ 15,044 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | Mar. 31, 2023 |
Minimum | |
LEASES | |
Operating lease, lease term | 3 years |
Finance lease, lease term | 3 years |
Maximum | |
LEASES | |
Operating lease, lease term | 10 years |
Finance lease, lease term | 10 years |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense and Payments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease cost | $ 5,981 | $ 6,142 | |
Short-term lease cost | 677 | 509 | |
Variable lease cost | 662 | 804 | |
Total operating lease cost | 7,320 | 7,455 | |
Finance lease cost: | |||
Amortization of right-of-use asset | 699 | 797 | |
Variable costs | 203 | 248 | |
Interest costs | 84 | 102 | |
Total finance lease cost | 986 | 1,147 | |
Payments for lease liabilities | 5,000 | 5,600 | |
Lease liabilities arising from ROU | 2,900 | 3,700 | |
Finance leases cost included in property, plant and equipment | 27,500 | $ 26,600 | |
Accumulated amortization related to finance leases | 14,100 | 13,500 | |
Principal payments, finance lease liabilities | 249 | $ 338 | |
Investing cash flows for finance lease liabilities | 900 | ||
Operating cash flows for finance lease liabilities | 100 | ||
Total | 5,085 | $ 5,459 | |
Finance lease liability, current | 1,000 | ||
Repositioning of Wholesale Roaming Operations | |||
Finance lease cost: | |||
Right of use assets terminated | 5,000 | ||
Lease liability terminated | 5,300 | ||
Gain on lease termination | $ 300 |
LEASES - Weighted average remai
LEASES - Weighted average remaining lease terms and discount rates (Details) | Mar. 31, 2023 | Dec. 31, 2022 |
LEASES | ||
Operating leases, weighted average remaining lease term | 13 years 1 month 6 days | 12 years 4 months 24 days |
Financing leases, weighted average remaining lease term | 9 years 3 months 18 days | 9 years 3 months 18 days |
Operating leases, weighted average discount rate | 6.10% | 6% |
Financing leases, weighted average discount rate | 6.90% | 6.70% |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Lessor, Lease, Description [Line Items] | |||
2023 (excluding the three months ended March 31, 2023) | $ 12,977 | ||
Year 1 | 17,023 | $ 19,417 | |
Year 2 | 13,897 | 17,836 | |
Year 3 | 9,771 | 14,805 | |
Year 4 | 7,708 | 10,505 | |
Year 5 | 8,096 | ||
Thereafter | 79,134 | ||
Thereafter | 76,452 | ||
Total lease payments | 140,510 | 147,111 | |
Less imputed interest | (53,450) | (53,794) | |
Total | $ 87,060 | $ 93,317 | |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Lease Liability, Current, Lease Liability, Noncurrent | Lease Liability, Current, Lease Liability, Noncurrent | |
Finance lease liability | |||
2023 (excluding the three months ended March 31, 2023) | $ 1,045 | ||
Year 1 | 1,240 | $ 1,403 | |
Year 2 | 972 | 1,342 | |
Year 3 | 504 | 978 | |
Year 4 | 495 | 504 | |
Year 5 | 495 | ||
Thereafter | 2,651 | ||
Thereafter | 2,651 | ||
Total lease payments | 6,907 | 7,373 | |
Less imputed interest | (1,822) | (1,914) | |
Total | $ 5,085 | $ 5,459 | |
Finance Lease, Liability, Statement of Financial Position [Extensible List] | Lease Liability, Current, Lease Liability, Noncurrent | Lease Liability, Current, Lease Liability, Noncurrent | |
Operating Lease, Lease Income, Statement of Income or Comprehensive Income [Extensible Enumeration] | Revenues | Revenues | |
Maturities of future undiscounted lease payments | |||
2023 (excluding the three months ended March 31, 2023) | $ 4,609 | ||
2024 | 5,891 | ||
2025 | 5,716 | ||
2026 | 5,410 | ||
2027 | 4,267 | ||
Thereafter | 14,360 | ||
Total future lease payments | 40,253 | ||
Network asset | |||
Finance lease liability | |||
Lease income | $ 1,900 | $ 1,000 |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Acquisition of Sacred Wind Enterprises (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Nov. 07, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Transaction-related charges | $ 13 | $ 554 | ||
Sacred Wind Enterprises | ||||
Business Acquisition [Line Items] | ||||
Consideration Transferred | $ 44,560 | |||
Cash transferred, net of cash acquired and other | 18,000 | |||
Cash acquired from acquisition | 9,400 | |||
Redeemable non-controlling interest | 14,800 | |||
Contingent consideration | 3,700 | |||
Receivables related to working capital adjustments | $ 1,300 | |||
Business combination equity interest | 6% | |||
Current liabilities of deposits received under government grant programs | $ 6,500 | |||
Transaction-related charges | $ 800 | |||
Assumed debt | 31,639 | |||
Sacred Wind Enterprises | Trade name licenses | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 600 | |||
Sacred Wind Enterprises | Minimum | Telecommunication Equipment | ||||
Business Acquisition [Line Items] | ||||
Discounted rate used for cash flows (as a percent) | 7% | |||
Useful life | 1 year | |||
Sacred Wind Enterprises | Maximum | Trade name licenses | ||||
Business Acquisition [Line Items] | ||||
Intangible assets useful lives | 5 years | |||
Sacred Wind Enterprises | Maximum | Telecommunication Equipment | ||||
Business Acquisition [Line Items] | ||||
Discounted rate used for cash flows (as a percent) | 12% | |||
Useful life | 25 years |
ACQUISITIONS AND DISPOSITIONS_2
ACQUISITIONS AND DISPOSITIONS - Preliminary allocation (Details) - Sacred Wind Enterprises $ in Thousands | Nov. 07, 2022 USD ($) |
Business Acquisition [Line Items] | |
Consideration Transferred | $ 44,560 |
Purchase price allocation: | |
Cash and cash equivalents | 2,619 |
Restricted cash | 6,747 |
Current assets | 4,888 |
Operating lease right-of-use assets | 989 |
Fixed assets | 85,255 |
Intangible assets | 1,232 |
Current liabilities | (10,176) |
Lease liabilities | (967) |
Deferred taxes | (14,388) |
Debt | (31,639) |
Net assets acquired | $ 44,560 |
FAIR VALUE MEASUREMENTS AND I_3
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Recurring (Details) - Recurring basis - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fair value measurements | ||
Total assets and liabilities measured at fair value | $ (35,686) | $ (36,055) |
Short Term Investments | ||
Fair value measurements | ||
Investments | 300 | 300 |
Other investments | ||
Fair value measurements | ||
Investments | 1,694 | 1,616 |
Redeemable common units | Alloy Inc | ||
Fair value measurements | ||
Derivative liabilities | (14,760) | (14,760) |
Redeemable common units | Alaska communications | ||
Fair value measurements | ||
Derivative liabilities | (22,266) | (22,557) |
Warrant | Alaska communications | ||
Fair value measurements | ||
Derivative liabilities | (654) | (654) |
Level 1 | ||
Fair value measurements | ||
Total assets and liabilities measured at fair value | 300 | 300 |
Level 1 | Short Term Investments | ||
Fair value measurements | ||
Investments | 300 | 300 |
Level 3 | ||
Fair value measurements | ||
Total assets and liabilities measured at fair value | (35,986) | (36,355) |
Level 3 | Other investments | ||
Fair value measurements | ||
Investments | 1,694 | 1,616 |
Level 3 | Redeemable common units | Alloy Inc | ||
Fair value measurements | ||
Derivative liabilities | (14,760) | (14,760) |
Level 3 | Redeemable common units | Alaska communications | ||
Fair value measurements | ||
Derivative liabilities | (22,266) | (22,557) |
Level 3 | Warrant | Alaska communications | ||
Fair value measurements | ||
Derivative liabilities | $ (654) | $ (654) |
FAIR VALUE MEASUREMENTS AND I_4
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Roll forward of investments | ||
Beginning balance | $ 38,169 | $ 48,444 |
Income (Loss) recognized | 315 | (563) |
Contributions / (distributions) | 630 | |
Foreign currency gain | 111 | 256 |
Gain recognized | 4,770 | |
Ending balance | 39,225 | 52,907 |
Investments without a readily determinable fair value | ||
Roll forward of investments | ||
Beginning balance | 22,590 | 17,820 |
Gain recognized | 4,770 | |
Ending balance | 22,590 | 22,590 |
Fair value investments | ||
Roll forward of investments | ||
Beginning balance | 1,616 | 1,925 |
Income (Loss) recognized | 77 | 99 |
Ending balance | 1,693 | 2,024 |
Equity investments | ||
Roll forward of investments | ||
Beginning balance | 13,963 | 28,699 |
Income (Loss) recognized | 238 | (662) |
Contributions / (distributions) | 630 | |
Foreign currency gain | 111 | 256 |
Ending balance | $ 14,942 | $ 28,293 |
FAIR VALUE MEASUREMENTS AND I_5
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Carrying Value | ||
Fair value measurements | ||
Long-term debt | $ 512.8 | $ 467.2 |
Level 2 | Total | ||
Fair value measurements | ||
Long-term debt | $ 519 | $ 473.7 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) $ in Thousands | 3 Months Ended | ||||||||||||
Dec. 23, 2022 USD ($) | Jul. 22, 2021 USD ($) | Apr. 10, 2019 USD ($) | Mar. 31, 2023 USD ($) derivative | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Nov. 07, 2022 USD ($) | Sep. 05, 2022 USD ($) | Jun. 15, 2022 USD ($) | May 05, 2022 | Mar. 26, 2020 USD ($) | Dec. 31, 2016 USD ($) | Jul. 01, 2016 USD ($) | |
Long-term debt | |||||||||||||
Outstanding borrowings | $ 512,788 | $ 467,248 | |||||||||||
Current portion of customer receivable credit facility | 6,574 | $ 6,073 | |||||||||||
Revolving credit facility - borrowings | $ 57,553 | $ 36,500 | |||||||||||
Alaska credit facility | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] | |||||||||||||
Long-term debt | |||||||||||||
Percentage of adjustment to applicable interest rate | 0.10% | ||||||||||||
One Communications Debt | Minimum | LIBOR | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 2.50% | ||||||||||||
One Communications Debt | Maximum | LIBOR | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 2.75% | ||||||||||||
GTT Credit Facility | |||||||||||||
Long-term debt | |||||||||||||
Stated interest rate | 7.50% | ||||||||||||
GTT Term Loan Facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 2,900 | ||||||||||||
Debt instrument term | 5 years | ||||||||||||
Borrowings outstanding | $ 0 | ||||||||||||
GTT Overdraft Facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 5,700 | ||||||||||||
Borrowings outstanding | 3,600 | ||||||||||||
Viya Debt | |||||||||||||
Long-term debt | |||||||||||||
Term loan assumed | $ 60,000 | ||||||||||||
Net leverage ratio | 7 | 3.5 | |||||||||||
Stated interest rate | 4% | 4% | |||||||||||
Financing costs | $ 900 | ||||||||||||
Outstanding debt | 60,000 | ||||||||||||
Unamortized financing costs | 300 | ||||||||||||
Revolver loan | Credit facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 200,000 | ||||||||||||
Remaining borrowing capacity | 54,000 | ||||||||||||
Net leverage ratio, if qualifying event | 3.25 | ||||||||||||
Borrowings outstanding | 122,000 | ||||||||||||
Revolver loan | Credit facility | Minimum | |||||||||||||
Long-term debt | |||||||||||||
Commitment fee (as a percent) | 0.15% | ||||||||||||
Net leverage ratio | 1.75 | ||||||||||||
Revolver loan | Credit facility | Minimum | LIBOR | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 1.25% | ||||||||||||
Revolver loan | Credit facility | Minimum | Base rate | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 0.25% | ||||||||||||
Revolver loan | Credit facility | Maximum | |||||||||||||
Long-term debt | |||||||||||||
Commitment fee (as a percent) | 0.375% | ||||||||||||
Net leverage ratio | 2.75 | ||||||||||||
Revolver loan | Credit facility | Maximum | LIBOR | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 2.25% | ||||||||||||
Revolver loan | Credit facility | Maximum | Base rate | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 1.25% | ||||||||||||
Letter of credit sub-facility | |||||||||||||
Long-term debt | |||||||||||||
Borrowings outstanding | 4,200 | ||||||||||||
Letter of credit sub-facility | Credit facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 75,000 | ||||||||||||
Performance letters of credit issued and outstanding | 24,000 | ||||||||||||
Swingline sub-facility | Credit facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 10,000 | ||||||||||||
Base rate before one-week or one-month LIBOR (as a percent) | 1% | ||||||||||||
Swingline sub-facility | Credit facility | Federal Funds Effective Rate | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 0.50% | ||||||||||||
Term loans | Credit facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 200,000 | ||||||||||||
Senior secured delayed draw term loan | Receivable credit facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 75,000 | ||||||||||||
Remaining borrowing capacity | 18,000 | ||||||||||||
Current portion of customer receivable credit facility | 6,600 | ||||||||||||
Financing costs | 800 | ||||||||||||
Borrowings outstanding | 48,700 | ||||||||||||
Unamortized financing costs | 600 | ||||||||||||
Senior secured delayed draw term loan | Sacred Wind Term Debt | |||||||||||||
Long-term debt | |||||||||||||
Outstanding borrowings | 30,600 | $ 31,600 | |||||||||||
Current portion of customer receivable credit facility | 3,200 | ||||||||||||
Non-current portion of customer receivable credit facility | $ 27,400 | ||||||||||||
Interest rate swap | Credit facility | |||||||||||||
Long-term debt | |||||||||||||
Number of derivative instruments | derivative | 0 | ||||||||||||
Alaska communications | Alaska credit facility | |||||||||||||
Long-term debt | |||||||||||||
Fixed charge coverage ratio | 1.25 | ||||||||||||
Net total leverage ratio | 4 | ||||||||||||
Financing costs | $ 7,300 | ||||||||||||
Unamortized financing costs | 5,000 | ||||||||||||
Consolidated EBITDA | 12 months | ||||||||||||
Alaska communications | Alaska credit facility | Base rate | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 1% | ||||||||||||
Alaska communications | Alaska credit facility | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] | |||||||||||||
Long-term debt | |||||||||||||
Percentage of adjustment to applicable interest rate | 0.10% | ||||||||||||
Alaska communications | Alaska credit facility | Minimum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 3% | ||||||||||||
Alaska communications | Alaska credit facility | Maximum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] | |||||||||||||
Long-term debt | |||||||||||||
Basis spread on variable rate (as a percent) | 4% | ||||||||||||
Alaska communications | Revolver loan | Alaska credit facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 75,000 | $ 35,000 | |||||||||||
Revolving credit facility - borrowings | 17,000 | ||||||||||||
Borrowings available to draw | 58,000 | ||||||||||||
Alaska communications | Term loans | Alaska credit facility | |||||||||||||
Long-term debt | |||||||||||||
Outstanding borrowings | $ 230,000 | 210,000 | |||||||||||
Borrowings outstanding | 230,000 | ||||||||||||
Alaska communications | Secured delayed draw term loan | Alaska Term Facility | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 7,500 | ||||||||||||
Remaining borrowing capacity | 0 | ||||||||||||
Outstanding borrowings | $ 7,100 | ||||||||||||
Stated interest rate | 4% | ||||||||||||
Alaska communications | Incremental term loans | Alaska credit facility | Minimum | |||||||||||||
Long-term debt | |||||||||||||
Maximum borrowing capacity | $ 70,000 | ||||||||||||
Alaska communications | Designated as cash flow hedges | Interest rate swap | |||||||||||||
Long-term debt | |||||||||||||
Interest rate (as a percent) | 1.6735% | ||||||||||||
Number of derivative instruments | derivative | 0 | ||||||||||||
Period of fourth quarter of 2023 To third quarter 2024 | Alaska communications | Alaska credit facility | |||||||||||||
Long-term debt | |||||||||||||
Periodic payment, principal | $ 1,400 | ||||||||||||
Debt Instrument, From Fourth Quarter of 2024 To Third Quarter of 2026 | Alaska communications | Alaska credit facility | |||||||||||||
Long-term debt | |||||||||||||
Periodic payment, principal | $ 2,900 | ||||||||||||
Period of second quarter of 2024 | Alaska communications | Alaska credit facility | |||||||||||||
Long-term debt | |||||||||||||
Net total leverage ratio | 3.75 |
LONG-TERM DEBT - Debt Maturity
LONG-TERM DEBT - Debt Maturity (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Book Value of Debt | $ 512,788 | $ 467,248 |
Total Debt | ||
Debt Instrument [Line Items] | ||
2023 (excluding the three months ended March 31, 2023) | 8,551 | |
2024 | 138,536 | |
2025 | 14,969 | |
2026 | 290,469 | |
2027 | 3,723 | |
Thereafter | 14,028 | |
Total debt | 470,276 | |
Debt Discounts | (5,595) | |
Book Value of Debt | 464,681 | |
Customer receivable credit facility | ||
Debt Instrument [Line Items] | ||
2023 (excluding the three months ended March 31, 2023) | 4,904 | |
2024 | 6,787 | |
2025 | 7,083 | |
2026 | 7,393 | |
2027 | 7,718 | |
Thereafter | 14,794 | |
Total debt | 48,679 | |
Debt Discounts | (572) | |
Book Value of Debt | 48,107 | |
US Telecom | Total Debt | ||
Debt Instrument [Line Items] | ||
2023 (excluding the three months ended March 31, 2023) | 4,998 | |
2024 | 138,536 | |
2025 | 14,969 | |
2026 | 230,469 | |
2027 | 3,723 | |
Thereafter | 14,028 | |
Total debt | 406,723 | |
Debt Discounts | (5,277) | |
Book Value of Debt | 401,446 | |
International Telecom | Total Debt | ||
Debt Instrument [Line Items] | ||
2023 (excluding the three months ended March 31, 2023) | 3,553 | |
2026 | 60,000 | |
Total debt | 63,553 | |
Debt Discounts | (318) | |
Book Value of Debt | $ 63,235 |
GOVERNMENT SUPPORT AND SPECTR_3
GOVERNMENT SUPPORT AND SPECTRUM MATTERS (Details) $ in Thousands | 3 Months Ended | ||||||
Mar. 31, 2023 USD ($) item | Mar. 31, 2022 USD ($) | Apr. 30, 2023 USD ($) | Jul. 31, 2022 USD ($) | Jul. 15, 2022 USD ($) | Jul. 31, 2021 USD ($) | Jun. 30, 2021 USD ($) | |
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | $ 172,557 | $ 159,912 | |||||
Total | 185,774 | 172,019 | |||||
Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Total | 181,308 | 166,543 | |||||
USF, CAF II, RDOF and Other Programs | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 26,978 | 16,193 | |||||
USF, CAF II, RDOF and Other Programs | US Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 25,577 | 13,432 | |||||
USF, CAF II, RDOF and Other Programs | International Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | $ 1,401 | 2,761 | |||||
Universal Service Fund programs | |||||||
Mobility Fund [Line Items] | |||||||
Number Of Fund Disbursement Programs | item | 4 | ||||||
High cost support program | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | $ 3,891 | 3,817 | |||||
High cost support program | US Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 2,494 | 1,056 | |||||
High cost support program | International Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 1,397 | 2,761 | |||||
CAF II | Grant receivable through December 2025 | |||||||
Mobility Fund [Line Items] | |||||||
Amount that has been funded or will be funded | 27,700 | ||||||
CAF II | Grant receivable from January 2026 through July 2028 | |||||||
Mobility Fund [Line Items] | |||||||
Amount that has been funded or will be funded | 8,000 | ||||||
CAF II | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 6,815 | 6,822 | |||||
CAF II | US Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 6,815 | 6,822 | |||||
TBCP | |||||||
Mobility Fund [Line Items] | |||||||
Grant funds awarded during the period | 145,500 | ||||||
Vija's annual USF support | |||||||
Mobility Fund [Line Items] | |||||||
Amount that has been funded or will be funded | $ 10,900 | $ 16,400 | |||||
Vija's annual USF support | Grant Receivable July 2022 Through June 2023 | |||||||
Mobility Fund [Line Items] | |||||||
Amount that has been funded or will be funded | $ 5,500 | ||||||
Vija's annual USF support | Subsequent event | Grant Receivable July 2023 Through December 2025 | |||||||
Mobility Fund [Line Items] | |||||||
Amount that has been funded or will be funded | $ 5,500 | ||||||
RDOF | |||||||
Mobility Fund [Line Items] | |||||||
Grant Funds Expected To Be Awarded | $ 22,700 | ||||||
Grant Fund Term | 10 years | ||||||
Number Of Households To Receive Broadband Coverage | item | 10,000 | ||||||
RDOF | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | $ 608 | ||||||
RDOF | US Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 608 | ||||||
Other Programs | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 15,664 | 5,554 | |||||
Other Programs | US Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 15,660 | $ 5,554 | |||||
Other Programs | International Telecom | Communication services | |||||||
Mobility Fund [Line Items] | |||||||
Revenue from contract with customer | 4 | ||||||
Remove And Replace Program | |||||||
Mobility Fund [Line Items] | |||||||
Receivable for costs expected to be reimbursed | $ 6,700 | ||||||
Remove And Replace Program | Maximum | |||||||
Mobility Fund [Line Items] | |||||||
Amount of cost reimbursement allocated | $ 207,000 |
GOVERNMENT SUPPORT AND SPECTR_4
GOVERNMENT SUPPORT AND SPECTRUM MATTERS- Construction (Details) - Network Connectivity for Eligible Communities $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Mobility Fund [Line Items] | |
Grants awarded | $ 80,197 |
New grants | 4,364 |
Grants awarded | $ 84,561 |
RETIREMENT PLANS - Net Periodic
RETIREMENT PLANS - Net Periodic Pension Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Components of the plan's net periodic pension cost | ||
Settlements | $ 369 | |
Pension benefits | ||
Components of the plan's net periodic pension cost | ||
Service cost | 38 | $ 57 |
Interest cost | 593 | 565 |
Expected return on plan assets | (953) | (925) |
Settlements | 369 | |
Net periodic pension expense (benefit) | 47 | (303) |
Postretirement benefits | ||
Components of the plan's net periodic pension cost | ||
Service cost | 31 | 36 |
Interest cost | 35 | 33 |
Net periodic pension expense (benefit) | $ 66 | $ 69 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
INCOME TAXES | ||
Effective tax rate (as a percent) | 9.50% | 296.70% |
Income tax (benefit) provisions | $ (740) | $ 2,952 |
Pre-tax income (loss) | (7,795) | 995 |
Increase unrecognized tax benefits | $ 600 | 500 |
Net expense to record the change in valuation allowance | $ 2,100 |
EARNINGS PER SHARE AND REDEEM_3
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Computation (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net Loss attributable to ATN International, Inc. stockholders- Basic | $ (5,885) | $ (948) |
Less: Preferred dividends | (1,045) | (1,116) |
Net Loss attributable to ATN International, Inc. common stockholders- Diluted | $ (6,930) | $ (2,064) |
Denominator: | ||
Weighted-average shares outstanding- Basic | 15,768 | 15,708 |
Weighted-average shares outstanding- Diluted | 15,768 | 15,708 |
EARNINGS PER SHARE AND REDEEM_4
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Redeemable Noncontrolling Interests Narrative (Details) - Redeemable Common Units - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Reconciliation from basic to diluted weighted average common shares outstanding | ||
Allocated losses | $ 2.8 | $ 1.1 |
Increased book value | $ 2.5 |
EARNINGS PER SHARE AND REDEEM_5
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Redeemable Noncontrolling Interests Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Increase (decrease) in temporary equity | ||
Beginning balance | $ 92,469 | $ 72,936 |
Accrued preferred dividend | 1,045 | 1,116 |
Allocated net loss | (2,821) | (1,092) |
Change in fair value | 2,530 | 1,092 |
Ending balance | 93,223 | 74,052 |
Redeemable Common Units | ||
Increase (decrease) in temporary equity | ||
Beginning balance | 37,317 | 22,640 |
Allocated net loss | (2,821) | (1,092) |
Change in fair value | 2,530 | 1,092 |
Ending balance | 37,026 | 22,640 |
Redeemable Preferred Units | ||
Increase (decrease) in temporary equity | ||
Beginning balance | 55,152 | 50,296 |
Accrued preferred dividend | 1,045 | 1,116 |
Ending balance | $ 56,197 | $ 51,412 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Segment reporting | |||
Number of reportable segments | segment | 2 | ||
Revenue | |||
Revenue | $ 185,774 | $ 172,019 | |
Depreciation and amortization | 36,404 | 33,292 | |
Amortization of intangibles from acquisitions | 3,247 | 3,258 | |
Non-cash stock-based compensation | 1,778 | 1,461 | |
Operating income (loss) | 636 | 108 | |
Segment Assets | |||
Cash, cash equivalents, and short term investments | 56,316 | $ 54,960 | |
Total current assets | 231,552 | 229,688 | |
Fixed assets, net | 1,056,363 | 1,055,954 | |
Goodwill | 40,104 | 40,104 | |
Total assets | 1,700,015 | 1,707,869 | |
Total current liabilities | 205,384 | 233,180 | |
Total debt | 512,788 | 467,248 | |
Capital Expenditures | |||
Capital expenditures | 52,725 | 34,468 | |
Communication services | |||
Revenue | |||
Revenue | 181,308 | 166,543 | |
Mobility | |||
Revenue | |||
Revenue | 27,266 | 25,416 | |
Mobility - Business | |||
Revenue | |||
Revenue | 3,747 | 3,990 | |
Mobility - Consumer | |||
Revenue | |||
Revenue | 23,519 | 21,426 | |
Fixed | |||
Revenue | |||
Revenue | 117,793 | 104,460 | |
Fixed - Business | |||
Revenue | |||
Revenue | 53,433 | 44,399 | |
Fixed - Consumer | |||
Revenue | |||
Revenue | 64,360 | 60,061 | |
Carrier services | |||
Revenue | |||
Revenue | 35,774 | 36,391 | |
Other communication services | |||
Revenue | |||
Revenue | 475 | 276 | |
Construction. | |||
Revenue | |||
Revenue | 590 | 1,987 | |
Other revenue | |||
Revenue | |||
Revenue | 3,876 | 3,489 | |
Managed Services | |||
Revenue | |||
Revenue | 3,876 | 3,489 | |
Corporate and Other | |||
Revenue | |||
Depreciation and amortization | 731 | 953 | |
Non-cash stock-based compensation | 1,634 | 1,311 | |
Operating income (loss) | (8,847) | (7,059) | |
Segment Assets | |||
Cash, cash equivalents, and short term investments | 6,219 | 6,936 | |
Total current assets | 7,733 | 8,326 | |
Fixed assets, net | 6,769 | 7,538 | |
Total assets | 81,999 | 83,662 | |
Total current liabilities | 19,573 | 26,687 | |
Total debt | 122,000 | 99,000 | |
Capital Expenditures | |||
Capital expenditures | 203 | ||
International Telecom | Operating segments | |||
Revenue | |||
Revenue | 90,408 | 86,787 | |
Depreciation and amortization | 14,186 | 13,897 | |
Amortization of intangibles from acquisitions | 380 | 418 | |
Non-cash stock-based compensation | 67 | 60 | |
Operating income (loss) | 13,825 | 11,802 | |
Segment Assets | |||
Cash, cash equivalents, and short term investments | 30,664 | 25,345 | |
Total current assets | 113,711 | 105,324 | |
Fixed assets, net | 468,961 | 462,447 | |
Goodwill | 4,835 | 4,835 | |
Total assets | 658,621 | 643,664 | |
Total current liabilities | 88,967 | 86,738 | |
Total debt | 63,235 | 59,659 | |
Capital Expenditures | |||
Capital expenditures | 21,464 | 15,170 | |
International Telecom | Operating segments | Communication services | |||
Revenue | |||
Revenue | 89,088 | 85,611 | |
International Telecom | Operating segments | Mobility | |||
Revenue | |||
Revenue | 26,107 | 23,586 | |
International Telecom | Operating segments | Mobility - Business | |||
Revenue | |||
Revenue | 3,575 | 3,616 | |
International Telecom | Operating segments | Mobility - Consumer | |||
Revenue | |||
Revenue | 22,532 | 19,970 | |
International Telecom | Operating segments | Fixed | |||
Revenue | |||
Revenue | 58,891 | 58,347 | |
International Telecom | Operating segments | Fixed - Business | |||
Revenue | |||
Revenue | 17,113 | 17,254 | |
International Telecom | Operating segments | Fixed - Consumer | |||
Revenue | |||
Revenue | 41,778 | 41,093 | |
International Telecom | Operating segments | Carrier services | |||
Revenue | |||
Revenue | 3,690 | 3,402 | |
International Telecom | Operating segments | Other communication services | |||
Revenue | |||
Revenue | 400 | 276 | |
International Telecom | Operating segments | Other revenue | |||
Revenue | |||
Revenue | 1,320 | 1,176 | |
International Telecom | Operating segments | Managed Services | |||
Revenue | |||
Revenue | 1,320 | 1,176 | |
US Telecom | Operating segments | |||
Revenue | |||
Revenue | 95,367 | 85,232 | |
Depreciation and amortization | 21,487 | 18,442 | |
Amortization of intangibles from acquisitions | 2,867 | 2,840 | |
Non-cash stock-based compensation | 77 | 90 | |
Operating income (loss) | (4,342) | (4,635) | |
Segment Assets | |||
Cash, cash equivalents, and short term investments | 19,433 | 22,679 | |
Total current assets | 110,108 | 116,038 | |
Fixed assets, net | 580,633 | 585,969 | |
Goodwill | 35,269 | 35,269 | |
Total assets | 959,395 | 980,543 | |
Total current liabilities | 96,844 | 119,755 | |
Total debt | 327,553 | $ 308,589 | |
Capital Expenditures | |||
Capital expenditures | 31,261 | 19,095 | |
US Telecom | Operating segments | Communication services | |||
Revenue | |||
Revenue | 92,220 | 80,932 | |
US Telecom | Operating segments | Mobility | |||
Revenue | |||
Revenue | 1,159 | 1,830 | |
US Telecom | Operating segments | Mobility - Business | |||
Revenue | |||
Revenue | 172 | 374 | |
US Telecom | Operating segments | Mobility - Consumer | |||
Revenue | |||
Revenue | 987 | 1,456 | |
US Telecom | Operating segments | Fixed | |||
Revenue | |||
Revenue | 58,902 | 46,113 | |
US Telecom | Operating segments | Fixed - Business | |||
Revenue | |||
Revenue | 36,320 | 27,145 | |
US Telecom | Operating segments | Fixed - Consumer | |||
Revenue | |||
Revenue | 22,582 | 18,968 | |
US Telecom | Operating segments | Carrier services | |||
Revenue | |||
Revenue | 32,084 | 32,989 | |
US Telecom | Operating segments | Other communication services | |||
Revenue | |||
Revenue | 75 | ||
US Telecom | Operating segments | Construction. | |||
Revenue | |||
Revenue | 590 | 1,987 | |
US Telecom | Operating segments | Other revenue | |||
Revenue | |||
Revenue | 2,556 | 2,313 | |
US Telecom | Operating segments | Managed Services | |||
Revenue | |||
Revenue | $ 2,556 | $ 2,313 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Legal claims regarding tax filings with the Guyana Revenue Authority | |
Commitments and contingencies | |
Future payments related to disputed tax assessments | $ 32 |
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% |
Pending litigation, adverse outcome | |
Commitments and contingencies | |
Accrued contingent liability | $ 15.3 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent event - Commnet Wireless, LLC - Carrier Managed Services Master Agreement - Cellco Partnership d/b/a Verizon Wireless $ in Millions | May 10, 2023 USD ($) Options |
Subsequent Event [Line Items] | |
Commitment period | 7 years |
Number of renewal options | Options | 2 |
Renewal commitment period | 3 years |
Notice for non-renewal commitment period | 12 months |
Non-recurring costs for upgrades and construction | $ | $ 200 |