Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 08, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 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 $.01 per share | |
Trading Symbol | ATNI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,421,481 | |
Entity Central Index Key | 0000879585 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 62,063 | $ 54,660 |
Restricted cash | 11,024 | 5,068 |
Short-term investments | 300 | 300 |
Accounts receivable, net of allowances for credit losses of $16.6 million and $15.2 million, respectively | 112,731 | 86,816 |
Customer receivable | 6,702 | 5,803 |
Inventory, materials and supplies | 18,139 | 17,902 |
Prepayments and other current assets | 56,406 | 59,139 |
Total current assets | 267,365 | 229,688 |
Fixed Assets: | ||
Property, plant and equipment | 2,078,886 | 1,977,978 |
Less accumulated depreciation | (1,009,453) | (922,024) |
Net fixed assets | 1,069,433 | 1,055,954 |
Telecommunication licenses, net | 113,698 | 113,698 |
Goodwill | 40,104 | 40,104 |
Intangible assets, net | 22,641 | 31,992 |
Operating lease right-of-use assets | 103,002 | 108,702 |
Customer receivable - long term | 44,623 | 46,706 |
Other assets | 90,360 | 81,025 |
Total assets | 1,751,226 | 1,707,869 |
Current Liabilities: | ||
Current portion of long-term debt | 21,278 | 6,173 |
Current portion of customer receivable credit facility | 6,727 | 6,073 |
Accounts payable and accrued liabilities | 155,170 | 155,224 |
Dividends payable | 3,260 | 3,310 |
Accrued taxes | 9,463 | 7,335 |
Current portion of lease liabilities | 16,331 | 15,457 |
Advance payments and deposits | 50,428 | 39,608 |
Total current liabilities | 262,657 | 233,180 |
Deferred income taxes | 19,198 | 28,650 |
Lease liabilities, excluding current portion | 80,260 | 83,319 |
Other liabilities | 133,102 | 138,420 |
Customer receivable credit facility, net of current portion | 38,010 | 39,275 |
Long-term debt, excluding current portion | 477,099 | 415,727 |
Total liabilities | 1,010,326 | 938,571 |
Total redeemable noncontrolling interests | 95,787 | 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; 17,702,476 and 17,584,057 shares issued, respectively, 15,522,140 and 15,763,341 shares outstanding, respectively | 173 | 173 |
Treasury stock, at cost; 2,180,336 and 1,820,716 shares, respectively | (86,977) | (73,825) |
Additional paid-in capital | 204,425 | 198,449 |
Retained earnings | 420,150 | 449,806 |
Accumulated other comprehensive income | 7,983 | 6,210 |
Total ATN International, Inc. stockholders' equity | 545,754 | 580,813 |
Noncontrolling interests | 99,359 | 96,016 |
Total equity | 645,113 | 676,829 |
Total liabilities, redeemable noncontrolling interests and equity | 1,751,226 | 1,707,869 |
Redeemable preferred units | ||
Current Liabilities: | ||
Total redeemable noncontrolling interests | 58,761 | 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 | Sep. 30, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowances | $ 16.6 | $ 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 | 17,702,476 | 17,584,057 |
Common stock, shares outstanding | 15,522,140 | 15,763,341 |
Treasury stock, shares | 2,180,336 | 1,820,716 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
REVENUE: | ||||
Total revenue | $ 191,036 | $ 182,213 | $ 563,250 | $ 533,730 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||||
Selling, general and administrative | 60,792 | 56,387 | 184,055 | 167,879 |
Stock-based compensation | 1,956 | 1,669 | 6,473 | 5,696 |
Transaction-related charges | 45 | 3,416 | 496 | 4,381 |
Restructuring expenses | 1,383 | 4,640 | ||
Depreciation and amortization | 34,370 | 33,312 | 106,991 | 100,421 |
Amortization of intangibles from acquisitions | 3,124 | 3,236 | 9,514 | 9,744 |
Loss on disposition of long-lived assets | 132 | 484 | 410 | 3,876 |
Total operating expenses | 184,200 | 180,774 | 553,339 | 530,458 |
Income from operations | 6,836 | 1,439 | 9,911 | 3,272 |
OTHER INCOME (EXPENSE) | ||||
Interest income | 136 | 38 | 362 | 41 |
Interest expense | (11,445) | (5,513) | (30,700) | (13,107) |
Other income | 213 | 1,904 | 2,623 | 3,379 |
Other income (expense) | (11,096) | (3,571) | (27,715) | (9,687) |
LOSS BEFORE INCOME TAXES | (4,260) | (2,132) | (17,804) | (6,415) |
Income tax benefit | (542) | (360) | (6,369) | (1,378) |
NET LOSS | (3,718) | (1,772) | (11,435) | (5,037) |
Net (income) loss attributable to noncontrolling interests, net of tax (benefit) expense of $(0.6) million, $(0.8) million, $(1.8) million and $(1.3) million respectively | 134 | (1,011) | 2,733 | 782 |
NET LOSS ATTRIBUTABLE TO ATN INTERNATIONAL, INC. STOCKHOLDERS | $ (3,584) | $ (2,783) | $ (8,702) | $ (4,255) |
Basic (in dollars per share) | $ (0.31) | $ (0.25) | $ (0.80) | $ (0.49) |
Diluted (in dollars per share) | $ (0.31) | $ (0.25) | $ (0.80) | $ (0.49) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||
Basic (in shares) | 15,601 | 15,763 | 15,666 | 15,746 |
Diluted (in shares) | 15,601 | 15,763 | 15,666 | 15,746 |
DIVIDENDS PER SHARE APPLICABLE TO COMMON STOCK | $ 0.21 | $ 0.17 | $ 0.63 | $ 0.51 |
Communication services | ||||
REVENUE: | ||||
Total revenue | $ 184,601 | $ 173,977 | $ 547,484 | $ 512,315 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||||
Cost of services | 80,367 | 78,949 | 237,125 | 229,821 |
Construction | ||||
REVENUE: | ||||
Total revenue | 2,038 | 3,332 | 3,648 | 8,615 |
OPERATING EXPENSES (excluding depreciation and amortization unless otherwise indicated): | ||||
Cost of services | 2,031 | 3,321 | 3,635 | 8,640 |
Other | ||||
REVENUE: | ||||
Total revenue | $ 4,397 | $ 4,904 | $ 12,118 | $ 12,800 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Non-controlling interest, net of tax (benefit) expense | $ (0.6) | $ (0.8) | $ (1.8) | $ (1.3) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
Net loss | $ (3,718) | $ (1,772) | $ (11,435) | $ (5,037) |
Other comprehensive income: | ||||
Foreign currency translation adjustment | (391) | 229 | (1,814) | |
Reclassification of foreign currency losses on investment | 1,349 | 1,349 | ||
Reclassification of loss on pension settlement, net of $(0.2) and $(0.8) million of tax | 195 | 915 | ||
Unrealized gain on derivatives | (34) | |||
Other comprehensive income (loss), net of tax | 1,349 | (391) | 1,773 | (933) |
Comprehensive loss | (2,369) | (2,163) | (9,662) | (5,970) |
Less: Comprehensive (income) loss attributable to noncontrolling interests | 134 | (1,011) | 2,733 | 782 |
Comprehensive loss attributable to ATN International, Inc. | $ (2,235) | $ (3,174) | $ (6,929) | $ (5,188) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Reclassification of loss on pension settlement, net of tax | $ (0.2) | $ (0.8) |
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 [Member] Total ATNI Stockholders' Equity | Redeemable Common Units [Member] Retained Earnings | Redeemable Common Units [Member] Non-Controlling Interests | Redeemable Common Units [Member] | 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 | (2,114) | (2,114) | (2,114) | ||||||||||||
Stock-based compensation | 5,225 | 5,225 | 471 | 5,696 | |||||||||||
Dividends declared on common stock | (8,035) | (8,035) | (1,375) | (9,410) | |||||||||||
Investments made by minority shareholders in consolidated affiliates | 22 | 22 | |||||||||||||
Repurchase of non-controlling interests | (454) | (454) | (4,178) | (4,632) | |||||||||||
Accrued dividend - redeemable preferred units | $ (3,462) | $ (3,462) | $ (3,462) | ||||||||||||
Deemed dividend | $ (2,762) | $ (2,762) | $ 2,762 | ||||||||||||
Comprehensive income: | |||||||||||||||
Net income (loss) | (4,255) | (4,255) | (782) | (5,037) | |||||||||||
Other comprehensive income (loss) | (933) | (933) | (933) | ||||||||||||
Total comprehensive income (loss) | (5,188) | (4,255) | (933) | (782) | (5,970) | ||||||||||
Balance, end of period at Sep. 30, 2022 | 584,460 | 172 | (73,828) | 196,903 | 457,373 | 3,840 | 97,923 | 682,383 | |||||||
Balance, beginning of period at Jun. 30, 2022 | 591,119 | 172 | (73,828) | 195,432 | 465,112 | 4,231 | 95,752 | 686,871 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Stock-based compensation | 1,481 | 1,481 | 186 | 1,667 | |||||||||||
Dividends declared on common stock | (2,681) | (2,681) | (2,681) | ||||||||||||
Investments made by minority shareholders in consolidated affiliates | 11 | 11 | |||||||||||||
Repurchase of non-controlling interests | (10) | (10) | (120) | (130) | |||||||||||
Accrued dividend - redeemable preferred units | (1,192) | (1,192) | (1,192) | ||||||||||||
Deemed dividend | (1,083) | (1,083) | 1,083 | ||||||||||||
Comprehensive income: | |||||||||||||||
Net income (loss) | (2,783) | (2,783) | 1,011 | (1,772) | |||||||||||
Other comprehensive income (loss) | (391) | (391) | (391) | ||||||||||||
Total comprehensive income (loss) | (3,174) | (2,783) | (391) | 1,011 | (2,163) | ||||||||||
Balance, end of period at Sep. 30, 2022 | 584,460 | 172 | (73,828) | 196,903 | 457,373 | 3,840 | 97,923 | 682,383 | |||||||
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 | (13,152) | (13,152) | (13,152) | ||||||||||||
Stock-based compensation | 6,057 | 6,057 | 416 | 6,473 | |||||||||||
Dividends declared on common stock | (9,864) | (9,864) | (1,447) | (11,311) | |||||||||||
Repurchase of non-controlling interests | (81) | (81) | (681) | (762) | |||||||||||
Accrued dividend - redeemable preferred units | (3,593) | (3,593) | (3,593) | ||||||||||||
Deemed dividend | (7,497) | (7,497) | 7,788 | $ 291 | |||||||||||
Comprehensive income: | |||||||||||||||
Net income (loss) | (8,702) | (8,702) | (2,733) | (11,435) | |||||||||||
Other comprehensive income (loss) | 1,773 | 1,773 | 1,773 | ||||||||||||
Total comprehensive income (loss) | (6,929) | (8,702) | 1,773 | (2,733) | (9,662) | ||||||||||
Balance, end of period at Sep. 30, 2023 | 545,754 | 173 | (86,977) | 204,425 | 420,150 | 7,983 | 99,359 | 645,113 | |||||||
Balance, beginning of period at Jun. 30, 2023 | 557,253 | 173 | (82,086) | 202,623 | 429,909 | 6,634 | 97,723 | 654,976 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Purchase of shares of common stock | (4,891) | (4,891) | (4,891) | ||||||||||||
Stock-based compensation | 1,802 | 1,802 | 154 | 1,956 | |||||||||||
Dividends declared on common stock | (3,260) | (3,260) | (3,260) | ||||||||||||
Repurchase of non-controlling interests | 4 | 4 | |||||||||||||
Deemed dividend | $ (1,303) | $ (1,303) | $ (1,303) | $ (1,612) | $ (1,612) | $ 1,612 | |||||||||
Comprehensive income: | |||||||||||||||
Net income (loss) | (3,584) | (3,584) | (134) | (3,718) | |||||||||||
Other comprehensive income (loss) | 1,349 | 1,349 | 1,349 | ||||||||||||
Total comprehensive income (loss) | (2,235) | (3,584) | 1,349 | (134) | (2,369) | ||||||||||
Balance, end of period at Sep. 30, 2023 | $ 545,754 | $ 173 | $ (86,977) | $ 204,425 | $ 420,150 | $ 7,983 | $ 99,359 | $ 645,113 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY | |||
Purchase of shares of common stock | 141,923 | 359,620 | 57,115 |
Dividends declared on common stock (in dollars per share) | $ 0.21 | $ 0.63 | $ 0.51 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (11,435) | $ (5,037) |
Adjustments to reconcile net loss to net cash flows provided by operating activities: | ||
Depreciation and amortization | 106,991 | 100,421 |
Amortization of intangibles from acquisitions | 9,514 | 9,744 |
Provision for doubtful accounts | 4,014 | 4,969 |
Amortization of debt discount and debt issuance costs | 1,806 | 1,512 |
Loss on disposition of long-lived assets | 410 | 3,876 |
Stock-based compensation | 6,473 | 5,696 |
Deferred income taxes | (9,452) | (6,619) |
Loss on pension settlement | 369 | 1,725 |
Gain on investments | (2,752) | (5,617) |
Changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions: | ||
Accounts receivable | (2,881) | (1,401) |
Customer receivable | 1,185 | (4,399) |
Prepaid income taxes | 739 | 6,206 |
Accrued taxes | 2,863 | 2,163 |
Materials and supplies, prepayments, and other current assets | 424 | (16,358) |
Accounts payable and accrued liabilities, advance payments and deposits and other current liabilities | (6,769) | (4,724) |
Other assets | (4,683) | (4,016) |
Other liabilities | (7,332) | (9,166) |
Net cash provided by operating activities | 89,484 | 78,975 |
Cash flows from investing activities: | ||
Capital expenditures | (126,640) | (109,944) |
Government capital programs - Amounts disbursed | (14,261) | (4,015) |
Government capital programs - Amounts received | 16,065 | 2,668 |
Purchases of strategic investments | (1,055) | (2,750) |
Sale of businesses, net of transferred cash of $0 | 1,835 | |
Spectrum deposit refund | 1,136 | |
Proceeds from strategic investments | 15,745 | |
Acquisition of businesses | 1,314 | |
Proceeds from sale of assets | 683 | |
Net cash used in investing activities | (124,577) | (94,642) |
Cash flows from financing activities: | ||
Dividends paid on common stock | (9,918) | (8,028) |
Distributions to noncontrolling interests | (1,447) | (1,375) |
Payment of debt issuance costs | (3,708) | |
Finance lease payments | (932) | (820) |
Term loan - repayments | (3,532) | (953) |
Term loan - borrowings | 130,000 | 711 |
Revolving credit facility - borrowings | 126,893 | 68,000 |
Revolving credit facility - repayments | (174,292) | (45,000) |
Proceeds from customer receivable credit facility | 4,300 | 12,225 |
Repayment of customer receivable credit facility | (4,998) | (3,543) |
Purchases of common stock - stock- based compensation | (1,473) | (1,169) |
Purchases of common stock - share repurchase plan | (11,679) | (942) |
Investments made by minority shareholders in consolidated affiliates | 22 | |
Repurchases of noncontrolling interests | (762) | (4,631) |
Contingent consideration paid for business acquisition | (1,718) | |
Net cash provided by financing activities | 48,452 | 12,779 |
Net change in cash, cash equivalents, and restricted cash | 13,359 | (2,888) |
Total cash, cash equivalents, and restricted cash, beginning of period | 59,728 | 80,697 |
Total cash, cash equivalents, and restricted cash, end of period | 73,087 | 77,809 |
Noncash investing activity: | ||
Amounts accrued for reimbursable capital expenditures from government capital programs | 25,244 | |
Amounts accrued for non-reimbursable capital expenditures | $ 19,107 | $ 21,491 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |
Net of transferred cash | $ 0 |
ORGANIZATION AND BUSINESS OPERA
ORGANIZATION AND BUSINESS OPERATIONS | 9 Months Ended |
Sep. 30, 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, the Company 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 receives 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 looks 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 September 30, 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, including 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. The Company has two operating segments to manage and review its operations and to facilitate investor presentations of its results. These ● 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 mobility services, 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 September 30, 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, Logic Managed Services Bermuda, Cayman Islands, US Virgin Islands, Guyana Fireminds, One, Logic, GTT, Viya US Telecom Mobility Services United States (rural markets) Choice NTUA Wireless Fixed Services United States Alaska Communications, Commnet Broadband, Choice NTUA Wireless, Sacred Wind Communications, Ethos Carrier Services United States Alaska Communications, Commnet, Essextel, Sacred Wind Communications Managed Services United States Alaska Communications, Fireminds 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. Restructuring Expense million in the three and nine months ended September 30, 2023, respectively. The charge is recorded in Restructuring Expense on the Company’s statements of operations. During the nine months ended September 30, 2023, the Company paid million of the restructuring expenses. In conjunction with the restructuring, the Company terminated |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 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 | 9 Months Ended |
Sep. 30, 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 Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Services transferred over time US Telecom $ 81,459 $ 76,542 $ 242,862 $ 221,033 International Telecom 87,657 84,770 260,066 248,552 Total 169,116 161,312 502,928 469,585 Goods and services transferred at a point in time US Telecom 4,111 5,839 9,255 18,140 International Telecom 4,752 4,294 11,792 10,181 Total 8,863 10,133 21,047 28,321 Total revenue accounted for under ASC 606 $ 177,979 $ 171,445 $ 523,975 $ 497,906 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 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 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. In May 2023, the Company amended its current roaming agreement and entered into a carrier management services agreement with Verizon Wireless (“Verizon CMS Agreement”). The transaction includes service performance obligations under which revenue is recognized over time. The Company allocates the transaction price of these agreements to each performance obligation based on the relative standalone selling price of each performance obligation in the contracts. 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. Contract assets and liabilities consisted of the following (amounts in thousands): September 30, 2023 December 31, 2022 $ Change % Change Contract asset – current $ 3,241 $ 2,932 $ 309 10.5 % Contract asset – noncurrent 4,050 3,775 275 7.3 % Contract liability – current (29,872) (27,284) (2,588) 9.5 % Contract liability – noncurrent (65,848) (72,543) 6,695 (9.2) % Net contract liability $ (88,429) $ (93,120) $ 4,691 (5.0) % 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 nine months ended September 30, 2023, the Company recognized revenue of Contract Acquisition Costs The September 30, 2023 balance sheet includes contract acquisition costs of $10.7 million in other assets. During the three and nine months ended September 30, 2023, the Company amortized million, respectively, of contract acquisition costs. During the three and nine months ended September 30, 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 September 30, 2023 and December 31, 2022, respectively. The increase during 2023 was related to the Verizon agreement discussed above. 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. The Company had gross accounts receivable of $180.2 million, including a receivable under the FirstNet Agreement totaling $51.3 million, of which $44.6 million was long-term, and an allowance for credit losses of $16.6 million as of September 30, 2023. The Company had gross accounts receivable of million as of December 31, 2022. 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: Nine months ended September 30, 2023 September 30, 2022 Balance at beginning of period $ 15,171 $ 13,885 Current period provision for expected losses 4,014 4,969 Write-offs charged against the allowance (3,017) (3,083) Recoveries collected 414 326 Balance at end of period $ 16,582 $ 16,097 |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 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 Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating lease cost: Operating lease cost $ 5,975 $ 6,061 $ 17,719 $ 18,398 Short-term lease cost 655 714 1,958 1,869 Variable lease cost 1,266 1,010 3,311 2,456 Total operating lease cost $ 7,896 $ 7,785 $ 22,988 $ 22,723 Finance lease cost: Amortization of right-of-use asset $ 735 $ 742 $ 2,239 $ 2,321 Variable costs 211 209 641 667 Interest costs 103 93 265 290 Total finance lease cost $ 1,049 $ 1,044 $ 3,145 $ 3,278 During the nine months ended September 30, 2023 and 2022, the Company paid $14.6 million and $16.0 million, respectively, for operating lease liabilities. During the nine months ended September 30, 2023 and 2022, the Company recorded $15.8 million and $6.1 million, respectively, of operating lease liabilities arising from ROU assets. During the nine months ended September 30, 2023, in conjunction with the restructuring activities the Company terminated $5.6 million of lease right of use assets, $5.9 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 September 30, 2023, finance leases with a cost of $31.6 million and accumulated amortization of $15.7 million were included in property, plant and equipment. During the nine months ended September 30, 2023, the Company paid $0.9 million of financing cash flows, $3.5 million of investing cash flows and $0.3 million of operating cash flows for finance lease liabilities. During the nine months ended September 30, 2022, the Company paid million of operating cash flows for finance lease liabilities. Additionally, during the nine months ended September 30, 2022, the Company disposed of a finance lease with a net book value of million. At September 30, 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 September 30, 2023 and December 31, 2022 are noted in the table below: September 30, 2023 December 31, 2022 Weighted-average remaining lease term Operating leases 13.0 years 12.4 years Financing leases 9.3 years 9.3 years Weighted-average discount rate Operating leases 6.3% 6.0% Financing leases 7.1% 6.7% Maturities of lease liabilities as of September 30, 2023 were as follows (in thousands): Operating Leases Financing Leases 2023 (excluding the nine months ended September 30, 2023) $ 4,896 $ 535 2024 19,349 2,153 2025 15,811 1,341 2026 11,498 542 2027 9,129 511 Thereafter 88,052 2,651 Total lease payments 148,735 7,733 Less imputed interest (58,122) (1,755) Total $ 90,613 $ 5,978 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 September 30, 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 wireless cell sites and buildings. For the nine months ended September 30, 2023 and 2022, the Company recorded million, respectively, of lease income from agreements in which the Company is the lessor. For the three months ended September 30, 2023 and 2022, the Company recorded million, respectively, of lease income. 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 nine months ended September 30, 2023) $ 1,891 2024 6,587 2025 6,394 2026 6,062 2027 4,874 Thereafter 15,641 Total future lease payments $ 41,449 |
USE OF ESTIMATES
USE OF ESTIMATES | 9 Months Ended |
Sep. 30, 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 | 9 Months Ended |
Sep. 30, 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”), a rural telecommunications provider in New Mexico for $44.6 million of consideration (“Sacred Wind Transaction”). The purchase price allocation was finalized during the nine months ended September 30, 2023. As part of the Sacred Wind Transaction, the Company transferred consideration of $16.7 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. During the nine months ended September 30, 2023, the Company received 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 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. 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 | 9 Months Ended |
Sep. 30, 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 September 30, 2023 and December 31, 2022 are summarized as follows (in thousands): September 30, 2023 Significant Other Quoted Prices in Unobservable Active Markets Inputs Description (Level 1) (Level 3) Total Short term investments $ 300 $ — $ 300 Other investments — 1,278 1,278 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 $ (36,402) $ (36,102) 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 method investments Total Balance, December 31, 2022 $ 22,590 $ 1,616 $ 13,963 $ 38,169 Income recognized 2,430 229 93 2,752 Contributions 425 (567) 630 488 Foreign currency gain — — 229 229 Reclassification of foreign currency losses — — 1,349 1,349 Transfers 16,264 — (16,264) — Balance, September 30, 2023 $ 41,709 $ 1,278 $ — $ 42,987 Balance, December 31, 2021 $ 17,820 $ 1,925 $ 28,699 $ 48,444 Sale of Investments (13,212) (13,212) Income (loss) recognized — 326 (2,163) (1,837) Contributions / (distributions) — (389) 2,750 2,361 Foreign currency loss — — (1,815) (1,815) Gain recognized 4,770 — — 4,770 Balance, September 30, 2022 $ 22,590 $ 1,862 $ 14,259 $ 38,711 During the nine months ended September 30, 2023, the Company lost the ability to exert significant influence over its India solar investment. As a result, the Company transferred million from equity method investments to investments without a readily determinable fair value and the accounting for the investment changed to the cost method from the equity method of accounting. Before transitioning to the cost method, the Company recorded income of 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 begin 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 combination of market and discounted cash flows approaches 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 September 30, 2023, the fair value of long-term debt, including the current portion, was $552.2 million and its book value was $543.1 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 | 9 Months Ended |
Sep. 30, 2023 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | 8. LONG-TERM DEBT 2023 CoBank Credit Facility On July 13, 2023, the Company, along with certain of its subsidiaries as guarantors, entered into a new Credit Agreement with CoBank, ACB and a syndicate of other lenders (as may be amended from time to time, the “2023 CoBank Credit Facility”). The 2023 CoBank Credit Facility provides for a five-year $170 million revolving credit facility (the “2023 CoBank Revolving Loan”) and a six-year $130 million term loan facility (the “2023 CoBank Term Loan”). The Company may use (i) up to $25 million under the 2023 CoBank Credit Facility for letters of credit, and (ii) up to $20 million under a swingline sub-facility. Upon the closing of the 2023 CoBank Credit Facility, the Company drew all of the 2023 CoBank Term Loan and approximately $13.6 million of the 2023 CoBank Revolving Loan. These borrowings were used to repay $139.5 million of debt outstanding under the 2019 CoBank Credit Facility at close. The 2023 CoBank Term Loan must be repaid in quarterly principal payments in the amounts set forth below, with the outstanding principal balance maturing on July 13, 2029. The 2023 CoBank Revolving Loan may be repaid at any time on or prior to its maturity on July 13, 2028. All amounts outstanding under the 2023 CoBank Credit Facility will be due and payable upon the earlier of the maturity date or the acceleration of the loans and commitments upon an event of default. 2023 CoBank Term Loan Quarterly Payment Dates 2023 CoBank Term Loan Quarterly Repayments December 31, 2023 – June 30, 2025 $812,500 (2.5% per annum) September 30, 2025 – June 30, 2026 $1,625,000 (5% per annum) September 30, 2026 – June 30, 2029 $2,437,500 (7.5% per annum) Amounts borrowed under the 2023 CoBank Credit Facility bear interest at a rate equal to, at the Company’s option, either (i) the secured overnight financing rate as administered by the Federal Reserve Bank of New York (SOFR) plus an applicable margin ranging between 2.00% to 3.75% for the 2023 CoBank Term Loan or 1.75% to 3.50% for Revolving Loans or (ii) a base rate plus an applicable margin ranging from 1.00% to 2.75% for the Term Loan or 0.75% to 2.50% for the 2023 CoBank Revolving Loans. Swingline loans will bear interest at the base rate plus the applicable margin for base rate loans. The base rate is equal to the higher of (i) 1.00% plus the one-month SOFR rate (ii) the federal funds effective rate (as defined in the 2023 CoBank Credit Agreement) plus 0.50% per annum; and (iii) the prime rate (as defined in the 2023 CoBank Credit Agreement). The applicable margin is determined based on the ratio (as further defined in the 2023 CoBank Credit Agreement) of the Company’s indebtedness to EBITDA. Under the terms of the 2023 CoBank Credit Agreement, the Company must also pay a fee ranging from 0.25% to 0.50% on the average daily unused portion of the 2023 CoBank Credit Facility over each calendar quarter. The 2023 CoBank Credit Agreement contains a financial covenant (as further defined in the 2023 CoBank Credit Agreement) that imposes a maximum ratio of indebtedness to EBITDA, as well as customary representations, warranties and covenants, including 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 Total Net Leverage Ratio is measured each fiscal quarter and is required to be less than or equal to The 2023 CoBank Credit Agreement provides for events of default customary for credit facilities of this type, including but not limited to non-payment, defaults on other debt, misrepresentation, breach of covenants, representations and warranties, insolvency and bankruptcy. The Company capitalized $4.0 million of fees associated with the 2023 CoBank Credit Facility which are being amortized over the life of the debt and $3.8 million were unamortized as of September 30, 2023. The Company had $130.0 million outstanding under the 2023 CoBank Term Loan as of September 30, 2023. Under the 2023 CoBank Revolving Loan, the Company had $23.1 million outstanding and $146.9 million of availability as of September 30, 2023. There were no outstanding interest rate hedge agreements under the 2023 CoBank Credit Facility as of September 30, 2023 and the Company was in compliance with all financial covenants as of that date. In October 2023, the Company entered a two year , forward starting 1-month floating to fixed SOFR interest rate swap agreement. The swap becomes effective November 13, 2023 in a notional amount of 2019 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 provided for a million under a swingline sub-facility. In connection with the execution of the 2023 CoBank Credit Facility, as defined above, outstanding borrowings under the 2019 CoBank Credit Facility were repaid in full. Amounts borrowed under the 2019 CoBank Credit Facility bore 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 bore interest at the base rate plus the applicable margin for base rate loans. The base rate was equal to the higher of (i) of the average daily unused portion of the 2019 CoBank Credit Facility over each calendar quarter. 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 September 30, 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 $210.0 million to $230.0 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 September 30, 2023, Alaska Communications had drawn $25.0 million on its Revolving Credit Commitment and had $50.0 million available to draw. The Term Loan balance was 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 $4.2 million were unamortized as of September 30, 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 September 30, 2023, there are no outstanding interest rate hedge agreements associated with the Alaska Credit Facility. In November 2023, Alaska Communications entered Alaska Term Facility On June 15, 2022, Alaska Communications Systems Holdings, the parent company of Alaska Communications, entered into 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 September 30, 2023, the Company had $6.4 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 accrue 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 September 30, 2023, the Company had $45.3 million outstanding, of which $6.7 million was current, and $18.0 million of availability under the Receivables Credit Facility. The Company capitalized GTT Credit Facilities On October 12, 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 that was received on 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 31, 2024. As of September 30, 2023, $3.5 million was outstanding under the overdraft facility and there were no outstanding amounts under the term facility. Sacred Wind Term Debt In connection with the Sacred Wind acquisition 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 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 September 30, 2023, the Company was in compliance with that corrective action plan. As of September 30, 2023, $29.0 million was outstanding under the Sacred Wind Term Debt. Of that amount, The mortgage notes carry fixed interest rates ranging from 0.88% to 5.0%. 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 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 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 the 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 September 30, 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 Corporate and Total Receivable Telecom Telecom Other Debt Credit Facility 2023 (excluding the nine months ended September 30, 2023) $ 2,637 $ 3,481 $ 813 $ 6,931 $ 1,476 2024 16,536 — 3,250 19,786 6,787 2025 14,969 — 4,875 19,844 7,083 2026 238,469 60,000 8,125 306,594 7,393 2027 3,723 — 9,750 13,473 7,718 Thereafter 14,028 — 126,307 140,335 14,794 Total 290,362 63,481 153,120 506,963 45,251 Debt Discounts (4,521) (271) (3,794) (8,586) (514) Book Value $ 285,841 $ 63,210 $ 149,326 $ 498,377 $ 44,737 |
GOVERNMENT SUPPORT AND SPECTRUM
GOVERNMENT SUPPORT AND SPECTRUM MATTERS | 9 Months Ended |
Sep. 30, 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 September 30, 2023. Revenue recognized from the USF and CAF II 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 Three months ended September 30, 2023 September 30, 2022 US Telecom International Telecom Total US Telecom International Telecom Total High cost support $ 2,288 $ 1,397 $ 3,685 $ 991 $ 943 $ 1,934 CAF II 6,815 — 6,815 6,822 — 6,822 RDOF 608 — 608 478 — 478 Other Programs 14,817 5 14,822 8,795 — 8,795 Total $ 24,528 $ 1,402 $ 25,930 $ 17,086 $ 943 $ 18,029 Nine months ended Nine months ended September 30, 2023 September 30, 2022 US Telecom International Telecom Total US Telecom International Telecom Total High cost support $ 7,004 $ 4,192 $ 11,196 $ 3,036 $ 6,465 $ 9,501 CAF II 20,445 — 20,445 20,466 — 20,466 RDOF 1,824 — 1,824 1,434 — 1,434 Other Programs 44,845 14 44,859 20,023 37 20,060 Total $ 74,118 $ 4,206 $ 78,324 $ 44,959 $ 6,502 $ 51,461 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 September 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, with the exception of grants the Company has transferred to third parties, as described below. A roll forward of the Company’s grant awards is below (in thousands). Amount Grants awarded, December 31, 2022 $ 80,197 New grants 34,821 Construction complete (7,725) Transferred grants (6,269) Grants awarded, September 30, 2023 $ 101,024 During the nine months ended September 30, 2023, the Company disbursed capital expenditures of $12.4 million under these programs and received reimbursement of $14.6 million. These cash flows are classified as investing activities in the Company’s statement of cash flows. In addition, the Company partners with tribal governments to obtain grants under various government programs including the Tribal Broadband Connectivity Program ("TBCP") and the Rural Development Broadband ReConnect Program (“ReConnect”). The TBCP and ReConnect programs are administered by United States government agencies to deploy broadband connectivity in certain underserved areas. The Company was identified as a sub recipient of grants under these programs totaling 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 $207 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 the project no later than one year from submitting its initial reimbursement request, or July 2024. At this time, the Company anticipates that it will be able to meet the deadlines and requirements of the program. During the nine months ended September 30, 2023 and 2022, the Company incurred capital expenditures related to this project of million, respectively. At September 30, 2023, million was accrued. The Company has a receivable of . For the nine months ended September 30, 2023 the Company received |
RETIREMENT PLANS
RETIREMENT PLANS | 9 Months Ended |
Sep. 30, 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 Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Pension benefits Postretirement benefits Pension benefits Postretirement benefits Operating expense Service cost $ 38 $ 31 $ 57 $ 36 $ 113 $ 62 $ 171 $ 108 Non-operating expense Interest cost 593 35 565 33 1,780 70 1,695 99 Expected return on plan assets (953) — (925) — (2,858) — (2,775) — Settlements — — — — 369 — 1,725 — Net periodic pension expense (benefit) $ (322) $ 66 $ (303) $ 69 $ (596) $ 132 $ 816 $ 207 The Company was not required to make contributions to its pension plans during the nine months ended September 30, 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 nine months ended September 30, 2023 and 2022. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | 11. INCOME TAXES The Company’s effective tax rate for the three months ended September 30, 2023 and 2022 was 12.7% and 16.9%, respectively. The Company recorded an income tax benefit of $0.5 million in relation to a pretax loss of $4.3 million for the three months ended September 30, 2023. The effective tax rate for the three months ended September 30, 2023 was primarily impacted by the following items (i) the mix of income generated among the jurisdictions in which the Company operates, (ii) net expense related to valuation allowances placed on certain deferred tax assets that are not expected to be realizable based on the weight of positive and negative evidence and (iii) discrete items including The Company recorded an income tax benefit of $0.4 million in relation to a pretax loss of $2.1 million for the three months ended September 30, 2022. The effective tax rate for the three months ended September 30, 2022 was primarily impacted by the following items (i) the mix of income generated among the jurisdictions in which the Company operates and (ii) discrete items including $0.9 million of expense for interest on unrecognized tax positions. The Company’s effective tax rate for the nine months ended September 30, 2023 and 2022 was 35.8% and 21.5%, respectively. The Company recorded an income tax benefit of $6.4 million in relation to a pretax loss of $17.8 million for the nine months ended September 30, 2023. The effective tax rate for the nine months ended September 30, 2023 was primarily impacted by the following items (i) the mix of income generated among the jurisdictions in which the Company operates, (ii) net expense related to valuation allowances placed on certain deferred tax assets that are not expected to be realizable based on the weight of positive and negative evidence and (iii) discrete items including a The Company recorded an income tax benefit of $1.4 million in relation to a pretax loss of $6.4 million for the nine months ended September 30, 2022. The effective tax rate for the nine months ended September 30, 2022 was primarily impacted by the following items (i) the mix of income generated among the jurisdictions in which the Company operates, (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) discrete items including a $3.3 million benefit from the reversal of an unrecognized tax position due to a statute of limitations expiration, and a $1.7 million expense for interest on unrecognized tax positions. 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 | 9 Months Ended |
Sep. 30, 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 September 30, Nine months ended September 30, 2023 2022 2023 2022 Numerator: Net loss attributable to ATN International, Inc. stockholders- Basic (3,584) (2,783) (8,702) (4,255) Less: Preferred dividends (1,303) (1,192) (3,593) (3,462) Net Loss attributable to ATN International, Inc. common stockholders- Diluted $ (4,887) $ (3,975) $ (12,295) $ (7,717) Denominator: Weighted-average shares outstanding- Basic 15,601 15,763 15,666 15,746 Weighted-average shares outstanding- Diluted 15,601 15,763 15,666 15,746 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 earnings 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 September 30, 2023 and 2022, the Company allocated losses of $1.6 million and $1.1 million, respectively, to the redeemable common units representing their proportionate share of operating losses. For the nine months ended September 30, 2023 and 2022, the Company allocated losses of $7.8 million and $2.8 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 The following table provides a roll forward of the activity related to the Company’s redeemable noncontrolling interests for the nine months ended September 30, 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 3,609 — 3,609 Allocated net loss — (7,788) (7,788) Change in fair value — 7,497 7,497 Balance, September 30, 2023 $ 58,761 $ 37,026 $ 95,787 Redeemable Preferred Units Redeemable Common Units Total Redeemable Noncontrolling Interests Balance, December 31, 2021 $ 50,296 $ 22,640 $ 72,936 Accrued preferred dividend 3,462 — 3,462 Allocated net loss — (2,762) (2,762) Change in fair value — 2,762 2,762 Balance, September 30, 2022 $ 53,758 $ 22,640 $ 76,398 |
SEGMENT REPORTING
SEGMENT REPORTING | 9 Months Ended |
Sep. 30, 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 September 30, 2023 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,818 $ 128 $ — $ 3,946 Mobility - Consumer 23,973 817 — 24,790 Total Mobility 27,791 945 — 28,736 Fixed - Business 18,016 35,680 — 53,696 Fixed - Consumer 41,967 22,662 — 64,629 Total Fixed 59,983 58,342 — 118,325 Carrier Services 3,441 32,319 — 35,760 Other 1,236 544 — 1,780 Total Communication Services Revenue 92,451 92,150 — 184,601 Construction — 2,038 — 2,038 Other Managed Services 1,427 2,970 — 4,397 Total other revenue 1,427 2,970 — 4,397 Total Revenue 93,878 97,158 — 191,036 Depreciation and amortization 14,354 19,398 618 34,370 Amortization of intangibles from acquisitions 240 2,884 — 3,124 Non-cash stock-based compensation 130 23 1,803 1,956 Operating income (loss) 12,800 3,017 (8,981) 6,836 For the Three Months Ended September 30, 2022 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,706 $ 298 $ — $ 4,004 Mobility - Consumer 22,776 2,058 — 24,834 Total Mobility 26,482 2,356 — 28,838 Fixed - Business 18,578 32,509 — 51,087 Fixed - Consumer 39,989 19,143 — 59,132 Total Fixed 58,567 51,652 — 110,219 Carrier Services 3,220 31,360 — 34,580 Other 340 — — 340 Total Communication Services Revenue 88,609 85,368 — 173,977 Construction — 3,332 — 3,332 Other Managed Services 1,398 3,506 — 4,904 Total Other Revenue 1,398 3,506 — 4,904 Total Revenue 90,007 92,206 — 182,213 Depreciation 14,126 18,341 845 33,312 Amortization of intangibles from acquisitions 380 2,856 — 3,236 Non-cash stock-based compensation 54 132 1,483 1,669 Operating income (loss) 13,360 716 (12,637) 1,439 For the Nine Months Ended September 30, 2023 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 11,484 $ 415 $ — $ 11,899 Mobility - Consumer 69,270 2,666 — 71,936 Total Mobility 80,754 3,081 — 83,835 Fixed - Business 52,602 107,494 — 160,096 Fixed - Consumer 125,944 67,852 — 193,796 Total Fixed 178,546 175,346 — 353,892 Carrier Services 11,011 95,978 — 106,989 Other 2,084 684 — 2,768 Total Communication Services Revenue 272,395 275,089 — 547,484 Construction — 3,648 — 3,648 Other Managed Services 3,872 8,246 — 12,118 Total Other Revenue 3,872 8,246 — 12,118 Total Revenue 276,267 286,983 — 563,250 Depreciation 42,646 62,315 2,030 106,991 Amortization of intangibles from acquisitions 984 8,530 — 9,514 Non-cash stock-based compensation 307 109 6,057 6,473 Operating income (loss) 41,177 (3,719) (27,547) 9,911 For the Nine Months Ended September 30, 2022 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 10,997 $ 973 $ — $ 11,970 Mobility - Consumer 64,025 5,063 — 69,088 Total Mobility 75,022 6,036 — 81,058 Fixed - Business 52,827 91,521 — 144,348 Fixed - Consumer 122,435 57,279 — 179,714 Total Fixed 175,262 148,800 — 324,062 Carrier Services 10,042 96,102 — 106,144 Other 1,051 — — 1,051 Total Communication Services Revenue 261,377 250,938 — 512,315 Construction — 8,615 — 8,615 Other Managed Services 3,820 8,980 — 12,800 Total other revenue 3,820 8,980 — 12,800 Total Revenue 265,197 268,533 — 533,730 Depreciation and amortization 43,109 54,546 2,766 100,421 Amortization of intangibles from acquisitions 1,192 8,552 — 9,744 Non-cash stock-based compensation 170 301 5,225 5,696 Operating income (loss) 36,889 (4,199) (29,418) 3,272 Selected balance sheet data for each of the Company’s segments as of September 30, 2023 and December 31, 2022 consists of the following (in thousands): International US Corporate and Telecom Telecom Other (1) Consolidated September 30, 2023 Cash, cash equivalents, and restricted cash $ 35,588 $ 31,678 $ 5,821 $ 73,087 Total current assets 115,888 143,280 8,197 267,365 Fixed assets, net 476,355 587,623 5,455 1,069,433 Goodwill 4,835 35,269 — 40,104 Total assets 671,285 996,413 83,528 1,751,226 Total current liabilities 82,178 148,352 32,127 262,657 Total debt, including current portion 63,209 285,842 149,326 498,377 December 31, 2022 Cash, cash equivalents, and restricted cash $ 26,418 $ 26,375 $ 6,935 $ 59,728 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, including current portion 59,659 263,241 99,000 421,900 For the nine months ended September 30, 2023 and 2022, the Company spent $140.9 million and $114.0 million, respectively, on capital expenditures relating to its telecommunications networks and business support systems of which $14.3 million and $4.0 million, respectively, are reimbursable under various government programs. The following notes the Company’s capital expenditures, by operating segment, for these periods (in thousands). Capital Expenditures International US Corporate and Nine months ended September 30, Telecom Telecom Other (1) Consolidated 2023 $ 57,610 $ 83,291 $ — $ 140,901 2022 53,270 60,056 633 113,959 (1) Corporate and other items refer to corporate overhead costs and consolidating adjustments |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 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, and to its successor, the Telecommunications Authority (“TA”). There have been limited further discussions on the subject of a revised spectrum fee methodology with the TA. 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, are currently pending in the Court of Appeals in Guyana, 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 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 would be offset in part by the amounts claimed with respect to rights ATN has pursuant to its agreement with the government of Guyana. GTT’s position has been upheld by various High Court rulings made in its favor including most recently in December 2021, and while some matters have been appealed by the GRA, other matters remain pending for determination by the High Court. 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 on 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 $15.8 million as of September 30, 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 | 9 Months Ended |
Sep. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 15. SUBSEQUENT EVENTS |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 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) | 9 Months Ended |
Sep. 30, 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, Logic Managed Services Bermuda, Cayman Islands, US Virgin Islands, Guyana Fireminds, One, Logic, GTT, Viya US Telecom Mobility Services United States (rural markets) Choice NTUA Wireless Fixed Services United States Alaska Communications, Commnet Broadband, Choice NTUA Wireless, Sacred Wind Communications, Ethos Carrier Services United States Alaska Communications, Commnet, Essextel, Sacred Wind Communications Managed Services United States Alaska Communications, Fireminds |
REVENUE RECOGNITION AND RECEI_2
REVENUE RECOGNITION AND RECEIVABLES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
REVENUE RECOGNITION AND RECEIVABLES | |
Summary of revenues | Three months ended Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Services transferred over time US Telecom $ 81,459 $ 76,542 $ 242,862 $ 221,033 International Telecom 87,657 84,770 260,066 248,552 Total 169,116 161,312 502,928 469,585 Goods and services transferred at a point in time US Telecom 4,111 5,839 9,255 18,140 International Telecom 4,752 4,294 11,792 10,181 Total 8,863 10,133 21,047 28,321 Total revenue accounted for under ASC 606 $ 177,979 $ 171,445 $ 523,975 $ 497,906 |
Summary of contracts asset and liabilities | Contract assets and liabilities consisted of the following (amounts in thousands): September 30, 2023 December 31, 2022 $ Change % Change Contract asset – current $ 3,241 $ 2,932 $ 309 10.5 % Contract asset – noncurrent 4,050 3,775 275 7.3 % Contract liability – current (29,872) (27,284) (2,588) 9.5 % Contract liability – noncurrent (65,848) (72,543) 6,695 (9.2) % Net contract liability $ (88,429) $ (93,120) $ 4,691 (5.0) % |
Schedule of activity in allowances for credit losses | Nine months ended September 30, 2023 September 30, 2022 Balance at beginning of period $ 15,171 $ 13,885 Current period provision for expected losses 4,014 4,969 Write-offs charged against the allowance (3,017) (3,083) Recoveries collected 414 326 Balance at end of period $ 16,582 $ 16,097 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
LEASES | |
Summary of components of lease expense | The components of lease expense were as follows (in thousands): Three months ended Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating lease cost: Operating lease cost $ 5,975 $ 6,061 $ 17,719 $ 18,398 Short-term lease cost 655 714 1,958 1,869 Variable lease cost 1,266 1,010 3,311 2,456 Total operating lease cost $ 7,896 $ 7,785 $ 22,988 $ 22,723 Finance lease cost: Amortization of right-of-use asset $ 735 $ 742 $ 2,239 $ 2,321 Variable costs 211 209 641 667 Interest costs 103 93 265 290 Total finance lease cost $ 1,049 $ 1,044 $ 3,145 $ 3,278 |
Summary of weighted-average remaining lease term and discount rate | September 30, 2023 December 31, 2022 Weighted-average remaining lease term Operating leases 13.0 years 12.4 years Financing leases 9.3 years 9.3 years Weighted-average discount rate Operating leases 6.3% 6.0% Financing leases 7.1% 6.7% |
Summary of maturities of operating lease liabilities | Maturities of lease liabilities as of September 30, 2023 were as follows (in thousands): Operating Leases Financing Leases 2023 (excluding the nine months ended September 30, 2023) $ 4,896 $ 535 2024 19,349 2,153 2025 15,811 1,341 2026 11,498 542 2027 9,129 511 Thereafter 88,052 2,651 Total lease payments 148,735 7,733 Less imputed interest (58,122) (1,755) Total $ 90,613 $ 5,978 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 nine months ended September 30, 2023) $ 4,896 $ 535 2024 19,349 2,153 2025 15,811 1,341 2026 11,498 542 2027 9,129 511 Thereafter 88,052 2,651 Total lease payments 148,735 7,733 Less imputed interest (58,122) (1,755) Total $ 90,613 $ 5,978 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 nine months ended September 30, 2023) $ 1,891 2024 6,587 2025 6,394 2026 6,062 2027 4,874 Thereafter 15,641 Total future lease payments $ 41,449 |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 9 Months Ended |
Sep. 30, 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 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) | 9 Months Ended |
Sep. 30, 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 September 30, 2023 and December 31, 2022 are summarized as follows (in thousands): September 30, 2023 Significant Other Quoted Prices in Unobservable Active Markets Inputs Description (Level 1) (Level 3) Total Short term investments $ 300 $ — $ 300 Other investments — 1,278 1,278 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 $ (36,402) $ (36,102) 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 method investments Total Balance, December 31, 2022 $ 22,590 $ 1,616 $ 13,963 $ 38,169 Income recognized 2,430 229 93 2,752 Contributions 425 (567) 630 488 Foreign currency gain — — 229 229 Reclassification of foreign currency losses — — 1,349 1,349 Transfers 16,264 — (16,264) — Balance, September 30, 2023 $ 41,709 $ 1,278 $ — $ 42,987 Balance, December 31, 2021 $ 17,820 $ 1,925 $ 28,699 $ 48,444 Sale of Investments (13,212) (13,212) Income (loss) recognized — 326 (2,163) (1,837) Contributions / (distributions) — (389) 2,750 2,361 Foreign currency loss — — (1,815) (1,815) Gain recognized 4,770 — — 4,770 Balance, September 30, 2022 $ 22,590 $ 1,862 $ 14,259 $ 38,711 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
LONG-TERM DEBT | |
Schedule of quarterly repayments | 2023 CoBank Term Loan Quarterly Payment Dates 2023 CoBank Term Loan Quarterly Repayments December 31, 2023 – June 30, 2025 $812,500 (2.5% per annum) September 30, 2025 – June 30, 2026 $1,625,000 (5% per annum) September 30, 2026 – June 30, 2029 $2,437,500 (7.5% per annum) |
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 Corporate and Total Receivable Telecom Telecom Other Debt Credit Facility 2023 (excluding the nine months ended September 30, 2023) $ 2,637 $ 3,481 $ 813 $ 6,931 $ 1,476 2024 16,536 — 3,250 19,786 6,787 2025 14,969 — 4,875 19,844 7,083 2026 238,469 60,000 8,125 306,594 7,393 2027 3,723 — 9,750 13,473 7,718 Thereafter 14,028 — 126,307 140,335 14,794 Total 290,362 63,481 153,120 506,963 45,251 Debt Discounts (4,521) (271) (3,794) (8,586) (514) Book Value $ 285,841 $ 63,210 $ 149,326 $ 498,377 $ 44,737 |
GOVERNMENT SUPPORT AND SPECTR_2
GOVERNMENT SUPPORT AND SPECTRUM MATTERS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Disaggregation of Revenue [Line Items] | |
Summary of revenues | Three months ended Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Services transferred over time US Telecom $ 81,459 $ 76,542 $ 242,862 $ 221,033 International Telecom 87,657 84,770 260,066 248,552 Total 169,116 161,312 502,928 469,585 Goods and services transferred at a point in time US Telecom 4,111 5,839 9,255 18,140 International Telecom 4,752 4,294 11,792 10,181 Total 8,863 10,133 21,047 28,321 Total revenue accounted for under ASC 606 $ 177,979 $ 171,445 $ 523,975 $ 497,906 |
Network Connectivity for Eligible Communities | |
Disaggregation of Revenue [Line Items] | |
Schedule of grant funds | A roll forward of the Company’s grant awards is below (in thousands). Amount Grants awarded, December 31, 2022 $ 80,197 New grants 34,821 Construction complete (7,725) Transferred grants (6,269) Grants awarded, September 30, 2023 $ 101,024 |
Communication services | |
Disaggregation of Revenue [Line Items] | |
Summary of revenues | Three months ended Three months ended September 30, 2023 September 30, 2022 US Telecom International Telecom Total US Telecom International Telecom Total High cost support $ 2,288 $ 1,397 $ 3,685 $ 991 $ 943 $ 1,934 CAF II 6,815 — 6,815 6,822 — 6,822 RDOF 608 — 608 478 — 478 Other Programs 14,817 5 14,822 8,795 — 8,795 Total $ 24,528 $ 1,402 $ 25,930 $ 17,086 $ 943 $ 18,029 Nine months ended Nine months ended September 30, 2023 September 30, 2022 US Telecom International Telecom Total US Telecom International Telecom Total High cost support $ 7,004 $ 4,192 $ 11,196 $ 3,036 $ 6,465 $ 9,501 CAF II 20,445 — 20,445 20,466 — 20,466 RDOF 1,824 — 1,824 1,434 — 1,434 Other Programs 44,845 14 44,859 20,023 37 20,060 Total $ 74,118 $ 4,206 $ 78,324 $ 44,959 $ 6,502 $ 51,461 |
RETIREMENT PLANS (Tables)
RETIREMENT PLANS (Tables) | 9 Months Ended |
Sep. 30, 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 Nine months ended September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Pension benefits Postretirement benefits Pension benefits Postretirement benefits Pension benefits Postretirement benefits Pension benefits Postretirement benefits Operating expense Service cost $ 38 $ 31 $ 57 $ 36 $ 113 $ 62 $ 171 $ 108 Non-operating expense Interest cost 593 35 565 33 1,780 70 1,695 99 Expected return on plan assets (953) — (925) — (2,858) — (2,775) — Settlements — — — — 369 — 1,725 — Net periodic pension expense (benefit) $ (322) $ 66 $ (303) $ 69 $ (596) $ 132 $ 816 $ 207 |
EARNINGS PER SHARE AND REDEEM_2
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS (Tables) | 9 Months Ended |
Sep. 30, 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 September 30, Nine months ended September 30, 2023 2022 2023 2022 Numerator: Net loss attributable to ATN International, Inc. stockholders- Basic (3,584) (2,783) (8,702) (4,255) Less: Preferred dividends (1,303) (1,192) (3,593) (3,462) Net Loss attributable to ATN International, Inc. common stockholders- Diluted $ (4,887) $ (3,975) $ (12,295) $ (7,717) Denominator: Weighted-average shares outstanding- Basic 15,601 15,763 15,666 15,746 Weighted-average shares outstanding- Diluted 15,601 15,763 15,666 15,746 |
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 nine months ended September 30, 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 3,609 — 3,609 Allocated net loss — (7,788) (7,788) Change in fair value — 7,497 7,497 Balance, September 30, 2023 $ 58,761 $ 37,026 $ 95,787 Redeemable Preferred Units Redeemable Common Units Total Redeemable Noncontrolling Interests Balance, December 31, 2021 $ 50,296 $ 22,640 $ 72,936 Accrued preferred dividend 3,462 — 3,462 Allocated net loss — (2,762) (2,762) Change in fair value — 2,762 2,762 Balance, September 30, 2022 $ 53,758 $ 22,640 $ 76,398 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 9 Months Ended |
Sep. 30, 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 September 30, 2023 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,818 $ 128 $ — $ 3,946 Mobility - Consumer 23,973 817 — 24,790 Total Mobility 27,791 945 — 28,736 Fixed - Business 18,016 35,680 — 53,696 Fixed - Consumer 41,967 22,662 — 64,629 Total Fixed 59,983 58,342 — 118,325 Carrier Services 3,441 32,319 — 35,760 Other 1,236 544 — 1,780 Total Communication Services Revenue 92,451 92,150 — 184,601 Construction — 2,038 — 2,038 Other Managed Services 1,427 2,970 — 4,397 Total other revenue 1,427 2,970 — 4,397 Total Revenue 93,878 97,158 — 191,036 Depreciation and amortization 14,354 19,398 618 34,370 Amortization of intangibles from acquisitions 240 2,884 — 3,124 Non-cash stock-based compensation 130 23 1,803 1,956 Operating income (loss) 12,800 3,017 (8,981) 6,836 For the Three Months Ended September 30, 2022 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 3,706 $ 298 $ — $ 4,004 Mobility - Consumer 22,776 2,058 — 24,834 Total Mobility 26,482 2,356 — 28,838 Fixed - Business 18,578 32,509 — 51,087 Fixed - Consumer 39,989 19,143 — 59,132 Total Fixed 58,567 51,652 — 110,219 Carrier Services 3,220 31,360 — 34,580 Other 340 — — 340 Total Communication Services Revenue 88,609 85,368 — 173,977 Construction — 3,332 — 3,332 Other Managed Services 1,398 3,506 — 4,904 Total Other Revenue 1,398 3,506 — 4,904 Total Revenue 90,007 92,206 — 182,213 Depreciation 14,126 18,341 845 33,312 Amortization of intangibles from acquisitions 380 2,856 — 3,236 Non-cash stock-based compensation 54 132 1,483 1,669 Operating income (loss) 13,360 716 (12,637) 1,439 For the Nine Months Ended September 30, 2023 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 11,484 $ 415 $ — $ 11,899 Mobility - Consumer 69,270 2,666 — 71,936 Total Mobility 80,754 3,081 — 83,835 Fixed - Business 52,602 107,494 — 160,096 Fixed - Consumer 125,944 67,852 — 193,796 Total Fixed 178,546 175,346 — 353,892 Carrier Services 11,011 95,978 — 106,989 Other 2,084 684 — 2,768 Total Communication Services Revenue 272,395 275,089 — 547,484 Construction — 3,648 — 3,648 Other Managed Services 3,872 8,246 — 12,118 Total Other Revenue 3,872 8,246 — 12,118 Total Revenue 276,267 286,983 — 563,250 Depreciation 42,646 62,315 2,030 106,991 Amortization of intangibles from acquisitions 984 8,530 — 9,514 Non-cash stock-based compensation 307 109 6,057 6,473 Operating income (loss) 41,177 (3,719) (27,547) 9,911 For the Nine Months Ended September 30, 2022 International US Corporate and Telecom Telecom Other (1) Consolidated Revenue Communication Services Mobility - Business $ 10,997 $ 973 $ — $ 11,970 Mobility - Consumer 64,025 5,063 — 69,088 Total Mobility 75,022 6,036 — 81,058 Fixed - Business 52,827 91,521 — 144,348 Fixed - Consumer 122,435 57,279 — 179,714 Total Fixed 175,262 148,800 — 324,062 Carrier Services 10,042 96,102 — 106,144 Other 1,051 — — 1,051 Total Communication Services Revenue 261,377 250,938 — 512,315 Construction — 8,615 — 8,615 Other Managed Services 3,820 8,980 — 12,800 Total other revenue 3,820 8,980 — 12,800 Total Revenue 265,197 268,533 — 533,730 Depreciation and amortization 43,109 54,546 2,766 100,421 Amortization of intangibles from acquisitions 1,192 8,552 — 9,744 Non-cash stock-based compensation 170 301 5,225 5,696 Operating income (loss) 36,889 (4,199) (29,418) 3,272 |
Schedule of segment balance sheet data and capital expenditures | Selected balance sheet data for each of the Company’s segments as of September 30, 2023 and December 31, 2022 consists of the following (in thousands): International US Corporate and Telecom Telecom Other (1) Consolidated September 30, 2023 Cash, cash equivalents, and restricted cash $ 35,588 $ 31,678 $ 5,821 $ 73,087 Total current assets 115,888 143,280 8,197 267,365 Fixed assets, net 476,355 587,623 5,455 1,069,433 Goodwill 4,835 35,269 — 40,104 Total assets 671,285 996,413 83,528 1,751,226 Total current liabilities 82,178 148,352 32,127 262,657 Total debt, including current portion 63,209 285,842 149,326 498,377 December 31, 2022 Cash, cash equivalents, and restricted cash $ 26,418 $ 26,375 $ 6,935 $ 59,728 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, including current portion 59,659 263,241 99,000 421,900 For the nine months ended September 30, 2023 and 2022, the Company spent $140.9 million and $114.0 million, respectively, on capital expenditures relating to its telecommunications networks and business support systems of which $14.3 million and $4.0 million, respectively, are reimbursable under various government programs. The following notes the Company’s capital expenditures, by operating segment, for these periods (in thousands). Capital Expenditures International US Corporate and Nine months ended September 30, Telecom Telecom Other (1) Consolidated 2023 $ 57,610 $ 83,291 $ — $ 140,901 2022 53,270 60,056 633 113,959 (1) Corporate and other items refer to corporate overhead costs and consolidating adjustments |
ORGANIZATION AND BUSINESS OPE_3
ORGANIZATION AND BUSINESS OPERATIONS (Details) | 9 Months Ended |
Sep. 30, 2023 segment | |
ORGANIZATION AND BUSINESS OPERATIONS | |
Number of operating segments | 2 |
ORGANIZATION AND BUSINESS OPE_4
ORGANIZATION AND BUSINESS OPERATIONS - Restructuring Expenses (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2023 USD ($) | Sep. 30, 2023 USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charge | $ 1,383 | $ 4,640 |
Repositioning of Wholesale Roaming Operations | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charge | 1,400 | 4,600 |
Restructuring paid | 2,600 | |
Gain on lease termination | 300 | |
Restructuring expenses accrued | $ 2,300 | 2,300 |
Right of use assets terminated | 5,600 | |
Lease liability terminated | $ 5,900 |
REVENUE RECOGNITION AND RECEI_3
REVENUE RECOGNITION AND RECEIVABLES - Timing of Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 177,979 | $ 171,445 | $ 523,975 | $ 497,906 |
Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 169,116 | 161,312 | 502,928 | 469,585 |
Goods and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 8,863 | 10,133 | 21,047 | 28,321 |
US Telecom | Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 81,459 | 76,542 | 242,862 | 221,033 |
US Telecom | Goods and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 4,111 | 5,839 | 9,255 | 18,140 |
International Telecom | Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 87,657 | 84,770 | 260,066 | 248,552 |
International Telecom | Goods and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 4,752 | $ 4,294 | $ 11,792 | $ 10,181 |
REVENUE RECOGNITION AND RECEI_4
REVENUE RECOGNITION AND RECEIVABLES - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Contract Assets and Liabilities | ||
Contract Asset - current | $ 3,241 | $ 2,932 |
Change in contract asset - current | $ 309 | |
% of change in contract asset - current | 10.50% | |
Contract Asset - noncurrent | $ 4,050 | 3,775 |
Change in contract asset - noncurrent | $ 275 | |
% of change in contract asset - noncurrent | 7.30% | |
Contract liability- current | $ (29,872) | (27,284) |
Change in contract liabilities - current | $ (2,588) | |
% of change in contract liabilities - current | 9.50% | |
Contract liability- noncurrent | $ (65,848) | (72,543) |
Change in contract liabilities - noncurrent | $ 6,695 | |
% of change in contract liabilities - Noncurrent | (9.20%) | |
Net contract liability | $ (88,429) | $ (93,120) |
Change in net contract liability | $ 4,691 | |
% of change in net contract liability | (5.00%) | |
Revenue recognized related to contract liability | $ 24,300 | |
Amortization of contract assets | $ 2,200 | |
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 | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Contract Acquisition Costs | ||||
Amortization of contract acquisition cost | $ 1.4 | $ 0.9 | $ 4.1 | $ 2.5 |
Other Assets | ||||
Contract Acquisition Costs | ||||
Short-term contract acquisition costs | $ 10.7 | $ 10.7 |
REVENUE RECOGNITION AND RECEI_6
REVENUE RECOGNITION AND RECEIVABLES - Remaining Performance Obligations (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 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]: 2023-10-01 | ||
Revenue Recognition | ||
Transaction price allocated to unsatisfied performance obligations | $ 474 | |
Percentage of performance obligations to be satisfied | 37% | |
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 | Sep. 30, 2023 | Dec. 31, 2022 |
Accounts Receivable | ||
Gross accounts receivable | $ 180,200 | $ 154,500 |
Customer receivable | 51,300 | 52,500 |
Customer receivable - long term | 44,623 | 46,706 |
Allowance for credit loss | $ 16,600 | $ 15,200 |
REVENUE RECOGNITION AND RECEI_8
REVENUE RECOGNITION AND RECEIVABLES - Allowance for Credit Losses Rollforward - (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
REVENUE RECOGNITION AND RECEIVABLES | ||
Beginning Balance | $ 15,171 | $ 13,885 |
Current period provision for expected losses | 4,014 | 4,969 |
Write-offs charged against the allowance | (3,017) | (3,083) |
Recoveries collected | 414 | 326 |
Ending Balance | $ 16,582 | $ 16,097 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | Sep. 30, 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 | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Lessee, Lease, Description [Line Items] | |||||
Operating lease cost | $ 5,975 | $ 6,061 | $ 17,719 | $ 18,398 | |
Short-term lease cost | 655 | 714 | 1,958 | 1,869 | |
Variable lease cost | 1,266 | 1,010 | 3,311 | 2,456 | |
Total operating lease cost | 7,896 | 7,785 | 22,988 | 22,723 | |
Finance lease cost: | |||||
Amortization of right-of-use asset | 735 | 742 | 2,239 | 2,321 | |
Variable costs | 211 | 209 | 641 | 667 | |
Interest costs | 103 | 93 | 265 | 290 | |
Total finance lease cost | 1,049 | $ 1,044 | 3,145 | 3,278 | |
Payments for lease liabilities | 14,600 | 16,000 | |||
Lease liabilities arising from ROU | 15,800 | 6,100 | |||
Finance leases cost included in property, plant and equipment | 31,600 | 31,600 | $ 26,600 | ||
Accumulated amortization related to finance leases | 15,700 | 15,700 | 13,500 | ||
Principal payments, finance lease liabilities | 932 | 820 | |||
Investing cash flows for finance lease liabilities | 3,500 | ||||
Operating cash flows for finance lease liabilities | 300 | 300 | |||
Finance lease, disposed | 2,300 | ||||
Loss on sale of finance lease | $ 1,000 | ||||
Finance lease liability | 5,978 | 5,978 | $ 5,459 | ||
Finance lease liability, current | $ 1,800 | 1,800 | |||
Repositioning of Wholesale Roaming Operations | |||||
Finance lease cost: | |||||
Right of use assets terminated | 5,600 | ||||
Lease liability terminated | 5,900 | ||||
Gain on lease termination | $ 300 |
LEASES - Weighted average remai
LEASES - Weighted average remaining lease terms and discount rates (Details) | Sep. 30, 2023 | Dec. 31, 2022 |
LEASES | ||
Operating leases, weighted average remaining lease term | 13 years | 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 | 6.30% | 6% |
Financing leases, weighted average discount rate | 7.10% | 6.70% |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Lessor, Lease, Description [Line Items] | |||||
2023 (excluding the nine months ended September 30, 2023) | $ 4,896 | $ 4,896 | |||
Year 1 | 19,349 | 19,349 | $ 19,417 | ||
Year 2 | 15,811 | 15,811 | 17,836 | ||
Year 3 | 11,498 | 11,498 | 14,805 | ||
Year 4 | 9,129 | 9,129 | 10,505 | ||
Year 5 | 8,096 | ||||
Thereafter | 88,052 | 88,052 | |||
Thereafter | 76,452 | ||||
Total lease payments | 148,735 | 148,735 | 147,111 | ||
Less imputed interest | (58,122) | (58,122) | (53,794) | ||
Total | $ 90,613 | $ 90,613 | $ 93,317 | ||
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Lease Liability, Current, Lease Liability, Noncurrent | Lease Liability, Current, Lease Liability, Noncurrent | Lease Liability, Current, Lease Liability, Noncurrent | ||
Finance lease liability | |||||
2023 (excluding the nine months ended September 30, 2023) | $ 535 | $ 535 | |||
Year 1 | 2,153 | 2,153 | $ 1,403 | ||
Year 2 | 1,341 | 1,341 | 1,342 | ||
Year 3 | 542 | 542 | 978 | ||
Year 4 | 511 | 511 | 504 | ||
Year 5 | 495 | ||||
Thereafter | 2,651 | ||||
Thereafter | 2,651 | 2,651 | |||
Total lease payments | 7,733 | 7,733 | 7,373 | ||
Less imputed interest | (1,755) | (1,755) | (1,914) | ||
Total | $ 5,978 | $ 5,978 | $ 5,459 | ||
Finance Lease, Liability, Statement of Financial Position [Extensible List] | Lease Liability, Current, Lease Liability, Noncurrent | Lease Liability, Current, Lease Liability, Noncurrent | Lease Liability, Current, Lease Liability, Noncurrent | ||
Maturities of future undiscounted lease payments | |||||
2023 (excluding the six months ended June 30, 2023) | $ 1,891 | $ 1,891 | |||
2024 | 6,587 | 6,587 | |||
2025 | 6,394 | 6,394 | |||
2026 | 6,062 | 6,062 | |||
2027 | 4,874 | 4,874 | |||
Thereafter | 15,641 | 15,641 | |||
Total future lease payments | 41,449 | 41,449 | |||
Network asset | |||||
Finance lease liability | |||||
Lease income | $ 1,900 | $ 1,500 | $ 5,800 | $ 4,400 |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Acquisition of Sacred Wind Enterprises (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Nov. 07, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||||||
Transaction-related charges | $ 45 | $ 3,416 | $ 496 | $ 4,381 | ||
Sacred Wind Enterprises | ||||||
Business Acquisition [Line Items] | ||||||
Consideration Transferred | $ 44,560 | |||||
Cash transferred, net of cash acquired and other | 16,700 | |||||
Cash acquired from acquisition | 9,400 | |||||
Redeemable non-controlling interest | 14,800 | |||||
Contingent consideration | $ 3,700 | |||||
Working capital adjustments received | 1,300 | 1,300 | ||||
Business combination equity interest | 6% | |||||
Current liabilities of deposits received under government grant programs | $ 6,500 | $ 6,500 | ||||
Transaction-related charges | $ 800 | |||||
Assumed debt | $ 31,639 | |||||
Sacred Wind Enterprises | Trade name licenses | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets | $ 600 | |||||
Intangible assets useful lives | 5 years | |||||
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 | 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 | Sep. 30, 2023 | Dec. 31, 2022 |
Fair value measurements | ||
Total assets and liabilities measured at fair value | $ (36,102) | $ (36,055) |
Short Term Investments | ||
Fair value measurements | ||
Investments | 300 | 300 |
Other investments | ||
Fair value measurements | ||
Investments | 1,278 | 1,616 |
Redeemable common units | ||
Fair value measurements | ||
Financial instruments | (22,266) | (22,557) |
Redeemable common units | Alloy Inc | ||
Fair value measurements | ||
Financial instruments | (14,760) | (14,760) |
Warrant | ||
Fair value measurements | ||
Financial instruments | (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 | (36,402) | (36,355) |
Level 3 | Other investments | ||
Fair value measurements | ||
Investments | 1,278 | 1,616 |
Level 3 | Redeemable common units | ||
Fair value measurements | ||
Financial instruments | (22,266) | (22,557) |
Level 3 | Redeemable common units | Alloy Inc | ||
Fair value measurements | ||
Financial instruments | (14,760) | (14,760) |
Level 3 | Warrant | ||
Fair value measurements | ||
Financial instruments | $ (654) | $ (654) |
FAIR VALUE MEASUREMENTS AND I_4
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
Roll forward of investments | |||
Beginning balance | $ 38,169 | $ 48,444 | |
Sale of Investments | (13,212) | ||
Income (loss) recognized | 2,752 | (1,837) | |
Contributions / (distributions) | 488 | 2,361 | |
Foreign currency gain (loss) | 229 | (1,815) | |
Reclassification of foreign currency losses on investment | $ 1,349 | 1,349 | |
Gain recognized | 4,770 | ||
Ending balance | 42,987 | 42,987 | 38,711 |
Investments without a readily determinable fair value | |||
Roll forward of investments | |||
Beginning balance | 22,590 | 17,820 | |
Income (loss) recognized | 2,430 | ||
Contributions / (distributions) | 425 | ||
Transfers | 16,264 | ||
Gain recognized | 4,770 | ||
Ending balance | 41,709 | 41,709 | 22,590 |
Fair value investments | |||
Roll forward of investments | |||
Beginning balance | 1,616 | 1,925 | |
Income (loss) recognized | 229 | 326 | |
Contributions / (distributions) | (567) | (389) | |
Ending balance | $ 1,278 | 1,278 | 1,862 |
Equity-method investments | |||
Roll forward of investments | |||
Beginning balance | 13,963 | 28,699 | |
Sale of Investments | (13,212) | ||
Income (loss) recognized | 93 | (2,163) | |
Contributions / (distributions) | 630 | 2,750 | |
Foreign currency gain (loss) | 229 | (1,815) | |
Reclassification of foreign currency losses on investment | 1,349 | ||
Transfers | $ (16,264) | ||
Ending balance | $ 14,259 |
FAIR VALUE MEASUREMENTS AND I_5
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | |
Fair value measurements | |||
Reclassification of foreign currency losses on investment | $ 1,349 | $ 1,349 | |
Equity investments | |||
Fair value measurements | |||
Equity method investments without a readily determinable fair value transferred to the cost method | 16,300 | 16,300 | |
Investment income | 100 | ||
Reclassification of foreign currency losses on investment | 1,349 | ||
Carrying Value | |||
Fair value measurements | |||
Long-term debt | 543,100 | 543,100 | $ 467,200 |
Level 2 | Total | |||
Fair value measurements | |||
Long-term debt | $ 552,200 | $ 552,200 | $ 473,700 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) $ in Thousands | 1 Months Ended | 9 Months Ended | ||||||||||||||
Jul. 13, 2023 USD ($) | Dec. 23, 2022 USD ($) | Jul. 22, 2021 USD ($) | Apr. 10, 2019 USD ($) | Oct. 31, 2023 USD ($) | Sep. 30, 2023 USD ($) derivative | Sep. 30, 2022 USD ($) | Nov. 08, 2023 USD ($) derivative | Dec. 31, 2022 USD ($) | Nov. 07, 2022 USD ($) | Oct. 22, 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 | $ 498,377 | $ 421,900 | ||||||||||||||
Current portion of long-term debt | 21,278 | 6,173 | ||||||||||||||
Long-term debt, excluding current portion | 477,099 | 415,727 | ||||||||||||||
Current portion of customer receivable credit facility | 6,727 | $ 6,073 | ||||||||||||||
Revolving credit facility - borrowings | $ 126,893 | $ 68,000 | ||||||||||||||
Alaska credit facility | SOFR | ||||||||||||||||
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 | ||||||||||||||||
Term of debt | 5 years | |||||||||||||||
Stated interest rate | 7.50% | |||||||||||||||
GTT Term Loan Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 2,900 | |||||||||||||||
Borrowings outstanding | $ 0 | |||||||||||||||
GTT Overdraft Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 5,700 | |||||||||||||||
Borrowings outstanding | 3,500 | |||||||||||||||
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 | 2019 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 200,000 | |||||||||||||||
Repayments of debt | $ 139,500 | |||||||||||||||
Revolver loan | 2019 CoBank Credit Facility | Minimum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Commitment fee (as a percent) | 0.15% | |||||||||||||||
Revolver loan | 2019 CoBank Credit Facility | Minimum | LIBOR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 1.25% | |||||||||||||||
Revolver loan | 2019 CoBank Credit Facility | Minimum | Base rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 0.25% | |||||||||||||||
Revolver loan | 2019 CoBank Credit Facility | Maximum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Commitment fee (as a percent) | 0.375% | |||||||||||||||
Revolver loan | 2019 CoBank Credit Facility | Maximum | LIBOR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 2.25% | |||||||||||||||
Revolver loan | 2019 CoBank 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 | 31,600 | |||||||||||||||
Letter of credit sub-facility | 2019 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 75,000 | |||||||||||||||
Letter of credit sub-facility | 2023 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | 25,000 | |||||||||||||||
Swingline sub-facility | 2019 CoBank 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 | 2019 CoBank Credit Facility | Federal Funds Effective Rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 0.50% | |||||||||||||||
Swingline sub-facility | 2023 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 20,000 | |||||||||||||||
Base rate before one-week or one-month LIBOR (as a percent) | 1% | |||||||||||||||
Swingline sub-facility | 2023 CoBank Credit Facility | Federal Funds Effective Rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 0.50% | |||||||||||||||
2023 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Financing costs | 4,000 | |||||||||||||||
Unamortized financing costs | 3,800 | |||||||||||||||
2023 CoBank Credit Facility | 2023 CoBank Credit Facility | Minimum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Commitment fee (as a percent) | 0.25% | |||||||||||||||
2023 CoBank Credit Facility | 2023 CoBank Credit Facility | Maximum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Commitment fee (as a percent) | 0.50% | |||||||||||||||
2023 CoBank Revolving Loan | 2023 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 170,000 | |||||||||||||||
Remaining borrowing capacity | 146,900 | |||||||||||||||
Borrowings outstanding | 23,100 | |||||||||||||||
Term of debt | 5 years | |||||||||||||||
Revolving credit facility - borrowings | $ 13,600 | |||||||||||||||
2023 CoBank Revolving Loan | 2023 CoBank Credit Facility | Minimum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 1.75% | |||||||||||||||
2023 CoBank Revolving Loan | 2023 CoBank Credit Facility | Minimum | Base rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 0.75% | |||||||||||||||
2023 CoBank Revolving Loan | 2023 CoBank Credit Facility | Maximum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Net leverage ratio | 3.25 | |||||||||||||||
2023 CoBank Revolving Loan | 2023 CoBank Credit Facility | Maximum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 3.50% | |||||||||||||||
2023 CoBank Revolving Loan | 2023 CoBank Credit Facility | Maximum | Base rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 2.50% | |||||||||||||||
2023 CoBank Term Loan | 2023 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Face amount of debt | $ 130,000 | |||||||||||||||
Borrowings outstanding | 130,000 | |||||||||||||||
Term of debt | 6 years | |||||||||||||||
2023 CoBank Term Loan | 2023 CoBank Credit Facility | Minimum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 2% | |||||||||||||||
2023 CoBank Term Loan | 2023 CoBank Credit Facility | Minimum | Base rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 1% | |||||||||||||||
2023 CoBank Term Loan | 2023 CoBank Credit Facility | Maximum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 3.75% | |||||||||||||||
2023 CoBank Term Loan | 2023 CoBank Credit Facility | Maximum | Base rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 2.75% | |||||||||||||||
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 | 6,700 | |||||||||||||||
Borrowings outstanding | 45,300 | |||||||||||||||
Financing costs | 800 | |||||||||||||||
Unamortized financing costs | 500 | |||||||||||||||
Senior secured delayed draw term loan | Sacred Wind Term Debt | ||||||||||||||||
Long-term debt | ||||||||||||||||
Outstanding borrowings | 29,000 | $ 31,600 | ||||||||||||||
Current portion of long-term debt | 3,200 | |||||||||||||||
Long-term debt, excluding current portion | $ 25,800 | |||||||||||||||
Senior secured delayed draw term loan | Sacred Wind Term Debt | Minimum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Stated interest rate | 0.88% | |||||||||||||||
Senior secured delayed draw term loan | Sacred Wind Term Debt | Maximum | ||||||||||||||||
Long-term debt | ||||||||||||||||
Stated interest rate | 5% | |||||||||||||||
Interest rate swap | 2023 CoBank Credit Facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Number of derivative instruments | derivative | 0 | |||||||||||||||
Subsequent event | 2023 CoBank Term Loan | 2023 CoBank Credit Facility | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 4.896% | |||||||||||||||
Derivative, Term of debt | 2 years | |||||||||||||||
Notional amount | $ 50,000 | |||||||||||||||
Subsequent event | Interest rate swap | Alaska credit facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Number of derivative instruments | derivative | 2 | |||||||||||||||
Subsequent event | Interest rate swap | Alaska credit facility | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Notional amount | $ 200,000 | |||||||||||||||
Subsequent event | Interest rate swap | Alaska credit facility | Minimum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Interest rate (in percent) | 4.8695% | |||||||||||||||
Subsequent event | Interest rate swap | Alaska credit facility | Maximum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Interest rate (in percent) | 4.898% | |||||||||||||||
Subsequent event | Interest rate swap | 2023 CoBank Credit Facility | 2023 CoBank Credit Facility | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 4.896% | |||||||||||||||
Derivative, Term of debt | 2 years | |||||||||||||||
Notional amount | $ 50,000 | |||||||||||||||
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 | 4,200 | |||||||||||||||
Consolidated EBITDA | 12 months | |||||||||||||||
Alaska communications | Alaska credit facility | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Percentage of adjustment to applicable interest rate | 0.10% | |||||||||||||||
Alaska communications | Alaska credit facility | Base rate | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 1% | |||||||||||||||
Alaska communications | Alaska credit facility | Minimum | SOFR | ||||||||||||||||
Long-term debt | ||||||||||||||||
Basis spread on variable rate (as a percent) | 3% | |||||||||||||||
Alaska communications | Alaska credit facility | Maximum | SOFR | ||||||||||||||||
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 | ||||||||||||||
Remaining borrowing capacity | 50,000 | |||||||||||||||
Revolving credit facility - borrowings | 25,000 | |||||||||||||||
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 credit facility | ||||||||||||||||
Long-term debt | ||||||||||||||||
Maximum borrowing capacity | $ 7,500 | |||||||||||||||
Remaining borrowing capacity | 0 | |||||||||||||||
Outstanding borrowings | $ 6,400 | |||||||||||||||
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 (in percent) | 1.6735% | |||||||||||||||
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 - Quarterly Paym
LONG-TERM DEBT - Quarterly Payments Dates (Details) - 2023 CoBank Term Loan - 2023 CoBank Credit Facility | Jul. 13, 2023 USD ($) |
Quarterly Payment, December 31, 2023 - June 30, 2025 | |
Debt Instrument [Line Items] | |
Quarterly repayments | $ 812,500 |
Interest rate | 2.50% |
Quarterly Payment, September 30, 2025 - June 30, 2026 | |
Debt Instrument [Line Items] | |
Quarterly repayments | $ 1,625,000 |
Interest rate | 5% |
Quarterly Payment, September 30, 2026 - June 30,2029 | |
Debt Instrument [Line Items] | |
Quarterly repayments | $ 2,437,500 |
Interest rate | 7.50% |
LONG-TERM DEBT - Debt Maturity
LONG-TERM DEBT - Debt Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Book Value of Debt | $ 498,377 | $ 421,900 |
Total Debt | ||
Debt Instrument [Line Items] | ||
2023 (excluding the nine months ended September 30, 2023) | 6,931 | |
2024 | 19,786 | |
2025 | 19,844 | |
2026 | 306,594 | |
2027 | 13,473 | |
Thereafter | 140,335 | |
Total debt | 506,963 | |
Debt Discounts | (8,586) | |
Book Value of Debt | 498,377 | |
Customer receivable credit facility | ||
Debt Instrument [Line Items] | ||
2023 (excluding the nine months ended September 30, 2023) | 1,476 | |
2024 | 6,787 | |
2025 | 7,083 | |
2026 | 7,393 | |
2027 | 7,718 | |
Thereafter | 14,794 | |
Total debt | 45,251 | |
Debt Discounts | (514) | |
Book Value of Debt | 44,737 | |
Corporate and Other | ||
Debt Instrument [Line Items] | ||
2023 (excluding the nine months ended September 30, 2023) | 813 | |
2024 | 3,250 | |
2025 | 4,875 | |
2026 | 8,125 | |
2027 | 9,750 | |
Thereafter | 126,307 | |
Total debt | 153,120 | |
Debt Discounts | (3,794) | |
Book Value of Debt | 149,326 | 99,000 |
US Telecom | Operating segments | ||
Debt Instrument [Line Items] | ||
Book Value of Debt | 285,842 | 263,241 |
US Telecom | Operating segments | Total Debt | ||
Debt Instrument [Line Items] | ||
2023 (excluding the nine months ended September 30, 2023) | 2,637 | |
2024 | 16,536 | |
2025 | 14,969 | |
2026 | 238,469 | |
2027 | 3,723 | |
Thereafter | 14,028 | |
Total debt | 290,362 | |
Debt Discounts | (4,521) | |
Book Value of Debt | 285,841 | |
International Telecom | Operating segments | ||
Debt Instrument [Line Items] | ||
Book Value of Debt | 63,209 | $ 59,659 |
International Telecom | Operating segments | Total Debt | ||
Debt Instrument [Line Items] | ||
2023 (excluding the nine months ended September 30, 2023) | 3,481 | |
2026 | 60,000 | |
Total debt | 63,481 | |
Debt Discounts | (271) | |
Book Value of Debt | $ 63,210 |
GOVERNMENT SUPPORT AND SPECTR_3
GOVERNMENT SUPPORT AND SPECTRUM MATTERS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) item | Sep. 30, 2022 USD ($) | Apr. 30, 2023 USD ($) | Dec. 31, 2022 USD ($) | 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 | $ 177,979 | $ 171,445 | $ 523,975 | $ 497,906 | ||||||
Reimbursable capital expenditures | 14,261 | 4,015 | ||||||||
Amounts accrued for reimbursable capital expenditures from government capital programs | 25,244 | |||||||||
Government capital programs - Amounts received | 16,065 | 2,668 | ||||||||
USF, CAF II, RDOF and Other Programs | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 25,930 | 18,029 | 78,324 | 51,461 | ||||||
USF, CAF II, RDOF and Other Programs | US Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 24,528 | 17,086 | 74,118 | 44,959 | ||||||
USF, CAF II, RDOF and Other Programs | International Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 1,402 | 943 | $ 4,206 | 6,502 | ||||||
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 | 3,685 | 1,934 | $ 11,196 | 9,501 | ||||||
High cost support program | US Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 2,288 | 991 | 7,004 | 3,036 | ||||||
High cost support program | International Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 1,397 | 943 | 4,192 | 6,465 | ||||||
CAF II | Grant receivable through December 2025 | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Amount that has been funded or will be funded | 27,700 | 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 | 8,000 | ||||||||
CAF II | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 6,815 | 6,822 | 20,445 | 20,466 | ||||||
CAF II | US Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 6,815 | 6,822 | 20,445 | 20,466 | ||||||
TBCP and Reconnect | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Grant funds awarded during the period | 188,600 | |||||||||
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 | 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 | $ 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 | 478 | $ 1,824 | 1,434 | ||||||
RDOF | US Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 608 | 478 | 1,824 | 1,434 | ||||||
Other Programs | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 14,822 | 8,795 | 44,859 | 20,060 | ||||||
Other Programs | US Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 14,817 | $ 8,795 | 44,845 | 20,023 | ||||||
Other Programs | International Telecom | Communication services | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Revenue from contract with customer | 5 | 14 | 37 | |||||||
Remove And Replace Program | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Reimbursable capital expenditures | 27,100 | $ 1,600 | ||||||||
Receivable for costs expected to be reimbursed | 36,600 | $ 36,600 | ||||||||
Reimbursement period | 12 months | |||||||||
Amounts accrued for reimbursable capital expenditures from government capital programs | $ 25,300 | |||||||||
Proceeds from grant funds awarded | 2,600 | |||||||||
Proceeds from grant funds awarded classified as operating cash inflows | 1,100 | |||||||||
Proceeds from grant funds awarded classified as investing cash inflows | 1,500 | |||||||||
Remove And Replace Program | Maximum | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Amount of cost reimbursement allocated | $ 207,000 | |||||||||
Network Connectivity for Eligible Communities | ||||||||||
Mobility Fund [Line Items] | ||||||||||
Reimbursable capital expenditures | 12,400 | |||||||||
Cumulative Grant Fund Awards | $ 101,024 | 101,024 | $ 80,197 | |||||||
Grant funds awarded during the period | 34,821 | |||||||||
Government capital programs - Amounts received | $ 14,600 |
GOVERNMENT SUPPORT AND SPECTR_4
GOVERNMENT SUPPORT AND SPECTRUM MATTERS - Construction (Details) - Network Connectivity for Eligible Communities $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Mobility Fund [Line Items] | |
Grants awarded | $ 80,197 |
New grants | 34,821 |
Construction complete | (7,725) |
Transferred grants | (6,269) |
Grants awarded | $ 101,024 |
RETIREMENT PLANS - Net Periodic
RETIREMENT PLANS - Net Periodic Pension Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Components of the plan's net periodic pension cost | ||||
Settlements | $ 369 | $ 1,725 | ||
Pension benefits | ||||
Components of the plan's net periodic pension cost | ||||
Service cost | $ 38 | $ 57 | 113 | 171 |
Interest cost | 593 | 565 | 1,780 | 1,695 |
Expected return on plan assets | (953) | (925) | (2,858) | (2,775) |
Settlements | 369 | 1,725 | ||
Net periodic pension expense (benefit) | (322) | (303) | (596) | 816 |
Postretirement benefits | ||||
Components of the plan's net periodic pension cost | ||||
Service cost | 31 | 36 | 62 | 108 |
Interest cost | 35 | 33 | 70 | 99 |
Net periodic pension expense (benefit) | $ 66 | $ 69 | $ 132 | $ 207 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
INCOME TAXES | ||||
Effective tax rate (as a percent) | 12.70% | 16.90% | 35.80% | 21.50% |
Income tax benefit | $ (542) | $ (360) | $ (6,369) | $ (1,378) |
Pre-tax loss | (4,260) | (2,132) | (17,804) | (6,415) |
Benefit from the reversal of unrecognized tax positions due to statute expiration | 4,000 | 3,300 | ||
Net expense to record the change in valuation allowance | 2,100 | |||
Interest on unrecognized tax position | $ 700 | $ 900 | $ 2,000 | $ 1,700 |
EARNINGS PER SHARE AND REDEEM_3
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Computation (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Numerator: | ||||
Net loss attributable to ATN International, Inc. stockholders- Basic | $ (3,584) | $ (2,783) | $ (8,702) | $ (4,255) |
Less: Preferred dividends | (1,303) | (1,192) | (3,593) | (3,462) |
Net Loss attributable to ATN International, Inc. common stockholders- Diluted | $ (4,887) | $ (3,975) | $ (12,295) | $ (7,717) |
Denominator: | ||||
Weighted-average shares outstanding- Basic | 15,601 | 15,763 | 15,666 | 15,746 |
Weighted-average shares outstanding- Diluted | 15,601 | 15,763 | 15,666 | 15,746 |
EARNINGS PER SHARE AND REDEEM_4
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Redeemable Noncontrolling Interests Narrative (Details) - Redeemable Common Units [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Reconciliation from basic to diluted weighted average common shares outstanding | ||||
Allocated losses | $ 1.6 | $ 1.1 | $ 7.8 | $ 2.8 |
Increased book value | $ 7.5 | $ 2.8 |
EARNINGS PER SHARE AND REDEEM_5
EARNINGS PER SHARE AND REDEEMABLE NONCONTROLLING INTERESTS - Redeemable Noncontrolling Interests Activity (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Increase (decrease) in temporary equity | ||
Beginning balance | $ 92,469 | $ 72,936 |
Accrued preferred dividend | 3,609 | 3,462 |
Allocated net loss | (7,788) | (2,762) |
Change in fair value | 7,497 | 2,762 |
Ending balance | 95,787 | 76,398 |
Redeemable Common Units [Member] | ||
Increase (decrease) in temporary equity | ||
Beginning balance | 37,317 | 22,640 |
Allocated net loss | (7,788) | (2,762) |
Change in fair value | 7,497 | 2,762 |
Ending balance | 37,026 | 22,640 |
Redeemable preferred units | ||
Increase (decrease) in temporary equity | ||
Beginning balance | 55,152 | 50,296 |
Accrued preferred dividend | 3,609 | 3,462 |
Ending balance | $ 58,761 | $ 53,758 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) segment | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Segment reporting | ||||||
Number of reportable segments | segment | 2 | |||||
Revenue | ||||||
Revenue | $ 191,036 | $ 182,213 | $ 563,250 | $ 533,730 | ||
Depreciation and amortization | 34,370 | 33,312 | 106,991 | 100,421 | ||
Amortization of intangibles from acquisitions | 3,124 | 3,236 | 9,514 | 9,744 | ||
Non-cash stock-based compensation | 1,956 | 1,669 | 6,473 | 5,696 | ||
Operating income (loss) | 6,836 | 1,439 | 9,911 | 3,272 | ||
Segment Assets | ||||||
Cash, cash equivalents, and restricted cash | 73,087 | 77,809 | 73,087 | 77,809 | $ 59,728 | $ 80,697 |
Total current assets | 267,365 | 267,365 | 229,688 | |||
Fixed assets, net | 1,069,433 | 1,069,433 | 1,055,954 | |||
Goodwill | 40,104 | 40,104 | 40,104 | |||
Total assets | 1,751,226 | 1,751,226 | 1,707,869 | |||
Total current liabilities | 262,657 | 262,657 | 233,180 | |||
Total debt, including current portion | 498,377 | 498,377 | 421,900 | |||
Capital Expenditures | ||||||
Capital expenditures | 140,901 | 113,959 | ||||
Government capital programs - Amounts disbursed | 14,261 | 4,015 | ||||
Communication services | ||||||
Revenue | ||||||
Revenue | 184,601 | 173,977 | 547,484 | 512,315 | ||
Mobility | ||||||
Revenue | ||||||
Revenue | 28,736 | 28,838 | 83,835 | 81,058 | ||
Mobility - Business | ||||||
Revenue | ||||||
Revenue | 3,946 | 4,004 | 11,899 | 11,970 | ||
Mobility - Consumer | ||||||
Revenue | ||||||
Revenue | 24,790 | 24,834 | 71,936 | 69,088 | ||
Fixed | ||||||
Revenue | ||||||
Revenue | 118,325 | 110,219 | 353,892 | 324,062 | ||
Fixed - Business | ||||||
Revenue | ||||||
Revenue | 53,696 | 51,087 | 160,096 | 144,348 | ||
Fixed - Consumer | ||||||
Revenue | ||||||
Revenue | 64,629 | 59,132 | 193,796 | 179,714 | ||
Carrier services | ||||||
Revenue | ||||||
Revenue | 35,760 | 34,580 | 106,989 | 106,144 | ||
Other communication services | ||||||
Revenue | ||||||
Revenue | 1,780 | 340 | 2,768 | 1,051 | ||
Construction. | ||||||
Revenue | ||||||
Revenue | 2,038 | 3,332 | 3,648 | 8,615 | ||
Other revenue | ||||||
Revenue | ||||||
Revenue | 4,397 | 4,904 | 12,118 | 12,800 | ||
Managed Services | ||||||
Revenue | ||||||
Revenue | 4,397 | 4,904 | 12,118 | 12,800 | ||
Corporate and Other | ||||||
Revenue | ||||||
Depreciation and amortization | 618 | 845 | 2,030 | 2,766 | ||
Non-cash stock-based compensation | 1,803 | 1,483 | 6,057 | 5,225 | ||
Operating income (loss) | (8,981) | (12,637) | (27,547) | (29,418) | ||
Segment Assets | ||||||
Cash, cash equivalents, and restricted cash | 5,821 | 5,821 | 6,935 | |||
Total current assets | 8,197 | 8,197 | 8,326 | |||
Fixed assets, net | 5,455 | 5,455 | 7,538 | |||
Total assets | 83,528 | 83,528 | 83,662 | |||
Total current liabilities | 32,127 | 32,127 | 26,687 | |||
Total debt, including current portion | 149,326 | 149,326 | 99,000 | |||
Capital Expenditures | ||||||
Capital expenditures | 633 | |||||
International Telecom | Operating segments | ||||||
Revenue | ||||||
Revenue | 93,878 | 90,007 | 276,267 | 265,197 | ||
Depreciation and amortization | 14,354 | 14,126 | 42,646 | 43,109 | ||
Amortization of intangibles from acquisitions | 240 | 380 | 984 | 1,192 | ||
Non-cash stock-based compensation | 130 | 54 | 307 | 170 | ||
Operating income (loss) | 12,800 | 13,360 | 41,177 | 36,889 | ||
Segment Assets | ||||||
Cash, cash equivalents, and restricted cash | 35,588 | 35,588 | 26,418 | |||
Total current assets | 115,888 | 115,888 | 105,324 | |||
Fixed assets, net | 476,355 | 476,355 | 462,447 | |||
Goodwill | 4,835 | 4,835 | 4,835 | |||
Total assets | 671,285 | 671,285 | 643,664 | |||
Total current liabilities | 82,178 | 82,178 | 86,738 | |||
Total debt, including current portion | 63,209 | 63,209 | 59,659 | |||
Capital Expenditures | ||||||
Capital expenditures | 57,610 | 53,270 | ||||
International Telecom | Operating segments | Communication services | ||||||
Revenue | ||||||
Revenue | 92,451 | 88,609 | 272,395 | 261,377 | ||
International Telecom | Operating segments | Mobility | ||||||
Revenue | ||||||
Revenue | 27,791 | 26,482 | 80,754 | 75,022 | ||
International Telecom | Operating segments | Mobility - Business | ||||||
Revenue | ||||||
Revenue | 3,818 | 3,706 | 11,484 | 10,997 | ||
International Telecom | Operating segments | Mobility - Consumer | ||||||
Revenue | ||||||
Revenue | 23,973 | 22,776 | 69,270 | 64,025 | ||
International Telecom | Operating segments | Fixed | ||||||
Revenue | ||||||
Revenue | 59,983 | 58,567 | 178,546 | 175,262 | ||
International Telecom | Operating segments | Fixed - Business | ||||||
Revenue | ||||||
Revenue | 18,016 | 18,578 | 52,602 | 52,827 | ||
International Telecom | Operating segments | Fixed - Consumer | ||||||
Revenue | ||||||
Revenue | 41,967 | 39,989 | 125,944 | 122,435 | ||
International Telecom | Operating segments | Carrier services | ||||||
Revenue | ||||||
Revenue | 3,441 | 3,220 | 11,011 | 10,042 | ||
International Telecom | Operating segments | Other communication services | ||||||
Revenue | ||||||
Revenue | 1,236 | 340 | 2,084 | 1,051 | ||
International Telecom | Operating segments | Other revenue | ||||||
Revenue | ||||||
Revenue | 1,427 | 1,398 | 3,872 | 3,820 | ||
International Telecom | Operating segments | Managed Services | ||||||
Revenue | ||||||
Revenue | 1,427 | 1,398 | 3,872 | 3,820 | ||
US Telecom | Operating segments | ||||||
Revenue | ||||||
Revenue | 97,158 | 92,206 | 286,983 | 268,533 | ||
Depreciation and amortization | 19,398 | 18,341 | 62,315 | 54,546 | ||
Amortization of intangibles from acquisitions | 2,884 | 2,856 | 8,530 | 8,552 | ||
Non-cash stock-based compensation | 23 | 132 | 109 | 301 | ||
Operating income (loss) | 3,017 | 716 | (3,719) | (4,199) | ||
Segment Assets | ||||||
Cash, cash equivalents, and restricted cash | 31,678 | 31,678 | 26,375 | |||
Total current assets | 143,280 | 143,280 | 116,038 | |||
Fixed assets, net | 587,623 | 587,623 | 585,969 | |||
Goodwill | 35,269 | 35,269 | 35,269 | |||
Total assets | 996,413 | 996,413 | 980,543 | |||
Total current liabilities | 148,352 | 148,352 | 119,755 | |||
Total debt, including current portion | 285,842 | 285,842 | $ 263,241 | |||
Capital Expenditures | ||||||
Capital expenditures | 83,291 | 60,056 | ||||
US Telecom | Operating segments | Communication services | ||||||
Revenue | ||||||
Revenue | 92,150 | 85,368 | 275,089 | 250,938 | ||
US Telecom | Operating segments | Mobility | ||||||
Revenue | ||||||
Revenue | 945 | 2,356 | 3,081 | 6,036 | ||
US Telecom | Operating segments | Mobility - Business | ||||||
Revenue | ||||||
Revenue | 128 | 298 | 415 | 973 | ||
US Telecom | Operating segments | Mobility - Consumer | ||||||
Revenue | ||||||
Revenue | 817 | 2,058 | 2,666 | 5,063 | ||
US Telecom | Operating segments | Fixed | ||||||
Revenue | ||||||
Revenue | 58,342 | 51,652 | 175,346 | 148,800 | ||
US Telecom | Operating segments | Fixed - Business | ||||||
Revenue | ||||||
Revenue | 35,680 | 32,509 | 107,494 | 91,521 | ||
US Telecom | Operating segments | Fixed - Consumer | ||||||
Revenue | ||||||
Revenue | 22,662 | 19,143 | 67,852 | 57,279 | ||
US Telecom | Operating segments | Carrier services | ||||||
Revenue | ||||||
Revenue | 32,319 | 31,360 | 95,978 | 96,102 | ||
US Telecom | Operating segments | Other communication services | ||||||
Revenue | ||||||
Revenue | 544 | 684 | ||||
US Telecom | Operating segments | Construction. | ||||||
Revenue | ||||||
Revenue | 2,038 | 3,332 | 3,648 | 8,615 | ||
US Telecom | Operating segments | Other revenue | ||||||
Revenue | ||||||
Revenue | 2,970 | 3,506 | 8,246 | 8,980 | ||
US Telecom | Operating segments | Managed Services | ||||||
Revenue | ||||||
Revenue | $ 2,970 | $ 3,506 | $ 8,246 | $ 8,980 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | Sep. 30, 2023 USD ($) |
Pending litigation, adverse outcome | |
Commitments and contingencies | |
Accrued contingent liability | $ 15.8 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Millions | 1 Months Ended | |||
Jul. 13, 2023 | Oct. 31, 2023 USD ($) | Nov. 08, 2023 USD ($) derivative | Sep. 30, 2023 derivative | |
2023 CoBank Credit Facility | Interest rate swap | ||||
Subsequent Event [Line Items] | ||||
Number of derivative agreements entered | derivative | 0 | |||
SOFR | 2023 CoBank Credit Facility | 2023 CoBank Term Loan | Minimum | ||||
Subsequent Event [Line Items] | ||||
Basis spread on variable rate (as a percent) | 2% | |||
SOFR | 2023 CoBank Credit Facility | 2023 CoBank Term Loan | Maximum | ||||
Subsequent Event [Line Items] | ||||
Basis spread on variable rate (as a percent) | 3.75% | |||
Subsequent event | Alaska credit facility | Interest rate swap | ||||
Subsequent Event [Line Items] | ||||
Number of derivative agreements entered | derivative | 2 | |||
Subsequent event | SOFR | 2023 CoBank Credit Facility | 2023 CoBank Term Loan | ||||
Subsequent Event [Line Items] | ||||
Derivative, Term of debt | 2 years | |||
Notional amount | $ | $ 50 | |||
Basis spread on variable rate (as a percent) | 4.896% | |||
Subsequent event | SOFR | Alaska credit facility | Interest rate swap | ||||
Subsequent Event [Line Items] | ||||
Notional amount | $ | $ 200 | |||
Subsequent event | SOFR | Alaska credit facility | Interest rate swap | Minimum | ||||
Subsequent Event [Line Items] | ||||
Fixed interest rate on derivative | 4.8695% | |||
Subsequent event | SOFR | Alaska credit facility | Interest rate swap | Maximum | ||||
Subsequent Event [Line Items] | ||||
Fixed interest rate on derivative | 4.898% |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |