Exhibit 99.1
Alaska Communications Systems Reports Third Quarter 2007 Results,
Announces Long Haul Fiber Build to the Lower 48
- Revenue Increased 10.5% to $99.8 Million Compared to Third
Quarter 2006 -
- Wireless Revenue Rose 18.2% to $37.2 Million -
- Cash Provided by Operating Activities Increased 16.4% to $31.1
Million -
- EBITDA of $36.1 Million Grew 11.2% over Third Quarter 2006 -
- Increases 2007 Annual Guidance -
ANCHORAGE, Alaska--(BUSINESS WIRE)--Oct. 25, 2007--Alaska
Communications Systems Group, Inc. ("ACS") (NASDAQ:ALSK) today
reported financial results for its third quarter and nine months ended
September 30, 2007. In addition, the company today separately
announced that it had entered into an agreement to construct a long
haul fiber facility from Alaska to the Lower 48.
"As we announce strong third quarter results--double digit top and
bottom line growth--and increase guidance for the year, we also mark
today as the three year anniversary of initiating the ALSK dividend
and the commitment to a major investment into a new line of business
at ACS designed to continue the track record of significant
shareholder value creation," said Liane Pelletier, ACS president,
chief executive officer and chair.
"Over the last three years, ACS has grown revenue by $70 million,
or 23 percent, and EBITDA by $25 million, or 25 percent, largely due
to a strategic investment to bring third generation CDMA wireless
service to the Alaskan market when penetration was estimated at a low
49 percent. With statewide penetration now at approximately 67
percent, ACS clearly succeeded in capturing growth with targeted
investment and quality execution. In the third quarter 2007, wireless
comprised 37 percent of total company sales and 49 percent of company
EBITDA."
"The next growth engine for ACS will be in the enterprise market,
including carrier and government, where needs for end-to-end data and
voice solutions span Alaska and the Lower 48. Building a submarine
fiber with superior performance characteristics, diverse routing and
the most modern and cost effective technology positions ACS to compete
profitably in a $200 million and growing market. ACS has been
participating in this market for some time; in fact, much of the
wireline growth in the third quarter and year-to-date comes from new
sales to Lower 48 carriers and large commercial accounts," added
Pelletier.
Financial Highlights: Third Quarter 2007 Compared to Third Quarter
2006
-- Revenues were $99.8 million, a 10.5 percent increase over
third quarter 2006 revenues of $90.4 million.
-- Operating income increased 15.8 percent to $18.6 million
compared to third quarter 2006 operating income of $16.0
million.
-- The company posted net income of $10.7 million, or $0.24 per
diluted share, compared to $0.20 per diluted share during the
third quarter of 2006.
-- Net cash provided by operating activities increased to $31.1
million, or 16.4 percent, compared to $26.7 million of net
cash in the same period a year ago.
-- EBITDA was $36.1 million, an increase of 11.2 percent,
compared to $32.5 million for the year-ago period. Third
quarter 2007 performance includes $1.0 million in
non-recurring expense benefits.
David Wilson, ACS senior vice president and chief financial
officer, said, "The business continued to perform ahead of
expectations in the third quarter with double digit percentage gains
in revenue, EBITDA and cash from operations over the prior year
quarter. We remain focused on ARPU growth in our traditional
subscriber-based business with wireless and retail local line ARPU
growing 5.5 percent and 1.9 percent, respectively, over the prior
year. Complementing the success in our traditional subscriber-based
business is our focus on the strategically important enterprise
market, where revenues grew by 70 percent to $6.5 million. Given
year-to-date performance, we are increasing annual guidance today for
revenue, EBITDA and capital expenditures."
"Our focus on capturing profitable growth in strategic telecom
segments, while stringently managing our cost base through our process
improvement initiatives, continues to drive cash flow expansion with
cash from operations reaching $31.1 million for the quarter, up 16.4
percent over the prior year. Major investments and uses of cash in the
quarter included capital expenditures of $15.9 million, comprising
$9.7 million in maintenance capital and $6.2 million in growth capital
expenditures, $4.2 million in debt redemptions, and $9.2 million in
dividend payments," added Wilson.
"We are comfortably positioned to fund our long haul fiber
investment, having closed the quarter with $41.8 million in
unrestricted cash, full access to our $45 million revolver, a net debt
to EBITDA leverage ratio of only 3.0 times, and a dividend payout
ratio of less than 60 percent," concluded Wilson.
Metric Highlights: Third Quarter 2007 Compared to Second Quarter
2007
-- Increased wireless subscribers by 1.3 percent, or 1,900,
bringing the total to approximately 143,800.
-- Average wireless monthly churn of 1.7 percent was up from 1.4
percent in the prior quarter. Approximately 99 percent of
retail wireless subscribers are now on the CDMA network, with
conversion of retail TDMA and analog users largely complete.
-- Increased wireless ARPU, now $64.11, up from $61.62 in Q2,
inclusive of CETC revenue of $10.89 and $9.92, respectively,
and with data ARPU now exceeding $3.00.
-- DSL lines increased by 570 to approximately 46,200 with retail
line penetration growing to 24.5 percent.
-- Retail local access lines declined by 1.7 percent to 188,500.
The rate of retail line loss compares favorably to publicly
reported CLEC line losses within the ACS LEC footprint of 1.9
percent.
-- Recorded approximately 231,600 total local access lines. Total
local access lines decreased by approximately 6,900 or 2.9
percent.
Nine Months Financial Review
For the nine months ended September 30, 2007, total revenues were
$283.6 million, which represented a 9.9 percent increase over revenues
of $258.1 million for the same period last year. Net income for the
nine months ended September 30, 2007, was $25.3 million, or $0.57 per
diluted share, compared to net income of $13.9 million, or $0.32 per
diluted share, in the same period in 2006. Net cash provided by
operating activities for the first nine months of 2007 was $77.7
million, compared to $64.6 million in the same period in 2006. EBITDA
for the nine months ended September 30, 2007, was $101.0 million, an
increase of 11.1 percent from $90.9 million in the same period last
year.
2007 Business Outlook
For the full-year 2007, ACS is increasing its revenue, EBITDA and
capital expenditure guidance. Revenues are now expected to be in the
range of $370 million to $375 million versus prior guidance of $360
million to $370 million, EBITDA to be in the range of $128 million to
$130 million versus prior guidance of $120 million to $124 million,
and capital expenditures are expected to be approximately $67 million
versus prior guidance of approximately $46 million. ACS is increasing
its maintenance capital expenditure guidance to a range of $37 million
to $39 million versus prior guidance of $37 million and its growth
capex guidance to $29 million versus $9 million with the increase in
growth capex guidance solely attributable to its long haul fiber
investment. ACS is reaffirming its cash interest expense guidance
which is expected to be approximately $27 million.
Long Haul Fiber Investment
ACS and Tyco Telecommunications announced today the signing of a
contract to construct an undersea fiber optic cable system between
Anchorage, Alaska and Florence, Oregon. ACS expects the total cost of
the system to be approximately $95 million, including the undersea
portions of the project to be managed and constructed by Tyco
Telecommunications and the complementary terrestrial system work, to
be managed by ACS. Of the total cost of the system, $3 million was
settled during the third quarter 2007, leaving a residual $92 million
to be funded over the next 15 months through a combination of cash on
hand, cash expected to be generated during the build period and
incremental debt of no more than $40 million. ACS expects the fiber
system to be operational early in first quarter 2009 with annual cash
costs, inclusive of financing costs, of approximately $10 million.
Conference Call
The company will host a conference call and live webcast today at
5:00 p.m. ET. Parties in the United States and Canada can call
800-219-6110 to access the conference call. Parties outside the United
States and Canada can access the call at 303-205-0033. The live
webcast of the conference call will be accessible from the "Events
Calendar" section of the company's website (www.alsk.com). The webcast
will be archived for a period of 90 days. A telephonic replay of the
conference call will also be available 2 hours after the call and will
run until Monday, October 29, 2007, at midnight ET. To hear the
replay, parties in the United States and Canada can call 800-405-2236
and enter pass code 11098890. Parties outside the United States and
Canada can call 303-590-3000 and enter pass code 11098890.
About Alaska Communications Systems
ACS is the leading integrated communications provider in Alaska,
offering local telephone service, wireless, long distance, data, and
Internet services to business and residential customers throughout
Alaska. More information can be found on the company's website at
www.acsalaska.com or at its investor site at www.alsk.com.
Forward-Looking EBITDA Guidance
This press release includes information related to management's
estimate of EBITDA for the year ending December 31, 2007. EBITDA, as
defined by the company, may not be similar to EBITDA measures used by
other companies and is not a measurement under generally accepted
accounting principles (GAAP). Management believes that EBITDA provides
useful information to investors about the company's performance
because it eliminates the effects of period-to-period changes in costs
associated with capital investments, interest and stock-based
compensation expense that are not directly attributable to the
underlying performance of the company's business operations.
Management believes the most directly comparable GAAP measure would be
"Net cash provided by operating activities." Due to the difficulty in
forecasting and quantifying the amounts that would be required to be
included in this comparable GAAP measure, the company is not providing
an estimate of year-end net cash provided by operating activities at
this time.
Forward-Looking Statements
This press release includes certain "forward-looking statements,"
as that term is defined in the Private Securities Litigation Reform
Act of 1995. These forward-looking statements are based on
management's beliefs as well as on a number of assumptions concerning
future events made using information currently available to
management. Readers are cautioned not to put undue reliance on such
forward-looking statements, which are not a guarantee of performance
and are subject to a number of uncertainties and other factors, many
of which are outside ACS' control. Such factors are, without
limitation, the company's ability to complete, manage, integrate,
market, maintain, and attract sufficient customers to the products and
services it may derive from the construction of the long-haul fiber
facility; fluctuations in wireless revenue, including roaming revenue;
changes in company's relationships with its roaming partners;
increased competition, including from national wireless and local
wireline facilities-based competitors; changes in revenue from
Universal Service Funds; changes in capital expenditures, or other
factors affecting the company's ability to generate sufficient
earnings and cash flows to continue to make dividend payments to its
stockholders; regulatory limitations on the company's ability to
change its pricing or bundle its communications services or other
public policy changes; the continued availability of financing
necessary to support future business; changes in accounting policies
or practices; changes in the demand for the company's products and
services; rapid technological developments in the telecommunications
industry; changes in interest rates or other general national,
regional or local economic conditions, including changes in tourism in
Alaska. For further information regarding risks and uncertainties
associated with ACS' business, please refer to the company's SEC
filings, including, but not limited to, the sections entitled "Risk
Factors" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in our annual report on Form 10-K
for the year ended December 31, 2006, and on Forms 10-Q filed
subsequently. Copies of the company's SEC filings may be obtained by
contacting its investor relations department at 907-564-7556 or by
visiting its investor relations website at www.alsk.com.
Schedule 1
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in Thousands, Except per Share Amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -------------------
2007 2006 2007 2006
--------- -------- --------- ---------
Operating revenues:
Wireline $ 62,672 $58,935 $181,409 $175,194
Wireless 37,159 31,441 102,227 82,895
--------- -------- --------- ---------
Total operating revenues 99,831 90,376 283,636 258,089
Operating expenses:
Wireline (exclusive of
depreciation and
amortization) 45,801 43,147 134,166 126,789
Wireless (exclusive of
depreciation and
amortization) 19,695 16,667 53,394 45,412
Depreciation and amortization 15,672 14,538 48,368 47,669
Loss on disposal of assets,
net 113 - 137 1,105
--------- -------- --------- ---------
Total operating expenses 81,281 74,352 236,065 220,975
--------- -------- --------- ---------
Operating income 18,550 16,024 47,571 37,114
Other income and expense:
Interest expense (7,739) (7,722) (23,064) (23,339)
Loss on extinguishment of debt (355) - (355) (9,650)
Interest income 485 492 1,520 1,286
Other (72) (74) (64) 8,443
--------- -------- --------- ---------
Total other income and
expense (7,681) (7,304) (21,963) (23,260)
--------- -------- --------- ---------
Income before income tax
expense 10,869 8,720 25,608 13,854
Income tax expense (170) - (275) -
--------- -------- --------- ---------
Net income $ 10,699 $ 8,720 $ 25,333 $ 13,854
========= ======== ========= =========
Net income per share:
Basic $ 0.25 $ 0.21 $ 0.59 $ 0.33
========= ======== ========= =========
Diluted $ 0.24 $ 0.20 $ 0.57 $ 0.32
========= ======== ========= =========
Weighted average shares
outstanding:
Basic 42,812 42,143 42,649 41,976
--------- -------- --------- ---------
Diluted 44,159 43,541 44,185 43,273
--------- -------- --------- ---------
Schedule 2
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands Except Per Share Amounts)
Unaudited
September 30, December 31,
Assets 2007 2006
------------- ------------
Current assets:
Cash and cash equivalents $ 41,765 $ 36,860
Restricted cash 2,559 1,700
Accounts receivable-trade, net of
allowance of $8,465 and $7,434 39,750 39,801
Materials and supplies 9,835 7,977
Prepayments and other current assets 4,270 3,514
------------- ------------
Total current assets 98,179 89,852
Property, plant and equipment 1,196,228 1,164,450
Less: accumulated depreciation and
amortization 807,920 767,907
------------- ------------
Property, plant and equipment, net 388,308 396,543
Goodwill 38,403 38,403
Intangible Assets 21,604 21,604
Debt issuance costs 7,934 9,437
Deferred charges and other assets 2,705 6,482
------------- ------------
Total assets $ 557,133 $ 562,321
============= ============
Liabilities and Stockholders' Equity
(Deficit)
Current liabilities:
Current portion of long-term obligations $ 957 $ 1,025
Accounts payable-affiliate - 2,942
Accounts payable, accrued and other
current liabilities 63,575 62,307
Advance billings and customer deposits 9,905 10,667
------------- ------------
Total current liabilities 74,437 76,941
Long-term obligations, net of current
portion 432,497 437,188
Other deferred credits and long-term
liabilities 78,463 72,881
------------- ------------
Total liabilities 585,397 587,010
------------- ------------
Stockholders' equity (deficit):
Common stock, $.01 par value; 145,000
authorized 428 423
Paid in capital in excess of par value 312,234 311,975
Accumulated deficit (337,169) (338,653)
Accumulated other comprehensive income
(loss) (3,757) 1,566
------------- ------------
Total stockholders' equity (deficit) (28,264) (24,689)
------------- ------------
Commitments and contingencies
Total liabilities and stockholders' equity
(deficit) $ 557,133 $ 562,321
============= ============
Schedule 3
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in Thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------- -------------------
2007 2006 2007 2006
--------- --------- --------- ---------
Cash Flows from Operating
Activities:
Net income $ 10,699 $ 8,720 $ 25,333 $ 13,854
Adjustments to reconcile net
income to net cash provided
(used) by operating
activities:
Depreciation and
amortization 15,672 14,538 48,368 47,669
Loss on disposal of assets,
net 113 - 137 1,105
Gain on sale of long-term
investment - - (152) (6,685)
Amortization of debt
issuance costs and original
issue discount 634 483 1,586 4,696
Stock based compensation(a) 1,839 1,990 5,172 5,275
Other non-cash expenses 131 - 394 -
Changes in components of
assets and liabilities:
Accounts receivable and
other current assets 496 (1,203) (2,563) (1,747)
Accounts payable and other
current liabilities 5 (1,424) (3,471) 348
Deferred charges and other
assets (370) (513) (208) (469)
Other deferred credits 1,860 4,109 3,123 575
--------- --------- --------- ---------
Net cash provided by
operating activities(a) 31,079 26,700 77,719 64,621
Cash Flows from Investing
Activities:
Investment in construction
and capital expenditures (15,938) (18,107) (39,502) (38,765)
Change in unsettled
construction and capital
expenditures 1,716 4,623 908 (1,656)
Purchase of short-term
investments (19,575) (19,675) (55,615) (39,600)
Proceeds from sale of short-
term investments 19,575 19,675 55,615 50,125
Proceeds from liquidation of
long-term investments - - 162 7,663
Placement of funds in
restricted account - - (2,979) -
Release of funds from escrow
account - 1,750 2,120 2,715
--------- --------- --------- ---------
Net cash used by investing
activities (14,222) (11,734) (39,291) (19,518)
Cash Flows from Financing
Activities:
Payments of long-term debt (4,261) (195) (4,893) (61,658)
Proceeds from the issuance
of long-term debt - - - 52,900
Debt issuance costs - - - (1,349)
Payment of cash dividend on
common stock (9,204) (9,047) (27,487) (26,403)
Payment of withholding taxes
on stock-based compensation (12) (11) (2,323) (864)
Issuance of common stock 110 406 1,180 1,636
--------- --------- --------- ---------
Net cash used by financing
activities (13,367) (8,847) (33,523) (35,738)
Increase in cash and cash
equivalents 3,490 6,119 4,905 9,365
Cash and cash equivalents,
beginning of period 38,275 32,123 36,860 28,877
--------- --------- --------- ---------
Cash and cash equivalents, end
of period $ 41,765 $ 38,242 $ 41,765 $ 38,242
========= ========= ========= =========
Supplemental Cash Flow Data:
Interest paid $ 7,279 $ 7,302 $ 21,564 $ 24,255
Income taxes paid 155 - 508 -
Supplemental Noncash
Transactions:
Property acquired under
capital leases $ - $ - $ 51 $ -
Dividend declared, but not
paid 5 17 9,215 9,077
(a)Stock compensation has been adjusted by $322 and $384, for the
three and nine months ended September 30, 2006, to include stock
based compensation costs for non-employee directors. This adjustment
also increases cash provided by operations in those same periods by
the same amounts.
Schedule 4
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
SCHEDULE OF WIRELINE REVENUES AND EXPENSES
(Unaudited, in Thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2007 2006 2007 2006
---------- ------- -------- --------
Local network service $ 19,285 $20,371 $ 58,728 $ 60,427
Network access 23,290 22,086 67,848 68,205
Deregulated and other 6,054 5,405 16,873 14,991
---------- ------- -------- --------
Local telephone 48,629 47,862 143,449 143,623
Internet/Data 7,986 6,544 22,768 18,619
Interexchange 6,057 4,529 15,192 12,952
---------- ------- -------- --------
Total wireline revenue $ 62,672 $58,935 $181,409 $175,194
========== ======= ======== ========
Local telephone $ 31,779 $32,368 $ 96,687 $ 95,996
Internet/Data 9,941 7,050 26,600 21,638
Interexchange 4,081 3,729 10,879 9,155
---------- ------- -------- --------
Total wireline expense(a) $ 45,801 $43,147 $134,166 $126,789
========== ======= ======== ========
(a)Expenses are shown exclusive of depreciation and amortization.
Schedule 5
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
SCHEDULE OF EBITDA CALCULATION
(Unaudited, in Thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------- -------------------
2007 2006 2007 2006
--------- --------- --------- ---------
Net cash provided by operating
activities(a) $ 31,079 $ 26,700 $ 77,719 $ 64,621
Adjustments to reconcile net
income to net cash
(provided) used by operating
activities:
Depreciation and
amortization (15,672) (14,538) (48,368) (47,669)
Loss on disposal of assets,
net (113) - (137) (1,105)
Gain on sale of long-term
investment - - 152 6,685
Amortization of debt
issuance costs and original
issue discount (634) (483) (1,586) (4,696)
Stock based compensation (1,839) (1,990) (5,172) (5,275)
Other non-cash expenses (131) - (394) -
Changes in components of
assets and liabilities:
Accounts receivable and
other current assets (496) 1,203 2,563 1,747
Accounts payable and other
current liabilities (5) 1,424 3,471 (348)
Deferred charges and other
assets 370 513 208 469
Other deferred credits (1,860) (4,109) (3,123) (575)
--------- --------- --------- ---------
Net income $ 10,699 $ 8,720 $ 25,333 $ 13,854
Add (subtract):
Interest expense 7,739 7,722 23,064 23,339
Loss on extinguishment of
debt 355 - 355 9,650
Interest income (485) (492) (1,520) (1,286)
Depreciation and
amortization 15,672 14,538 48,368 47,669
Loss on disposal of assets,
net 113 - 137 1,105
Gain on Crest asset purchase - - - (1,979)
Gain on sale of long-term
investments - - (152) (6,685)
Income tax expense 170 - 275 -
Stock based compensation 1,839 1,990 5,172 5,275
--------- --------- --------- ---------
EBITDA(a) $ 36,102 $ 32,478 $101,032 $ 90,942
========= ========= ========= =========
(a)Stock compensation has been adjusted by $322 and $384, for the
three and nine months ended September 30, 2006, to include stock
based compensation costs for non-employee directors. This adjustment
also increases cash provided by operations and EBITDA in those same
periods by those same amounts.
Note:In an effort to provide investors with additional information
regarding the Company's results as determined by generally accepted
accounting principles (GAAP), the Company also discloses certain non-
GAAP information which management utilizes to assess performance and
believes provides useful information to investors. The Company has
disclosed its net income before interest, provisions for taxes,
depreciation expense, gain or loss on asset purchases or disposals,
amortization of intangibles and stock based compensation expense
(EBITDA) because the Company believes it is an important indicator as
it provides information about our ability to service debt, pay
dividends and fund capital expenditures. EBITDA is not a GAAP measure
and should not be considered a substitute for net cash provided by
operating activities and other measures of financial performance
recorded in accordance with GAAP.
Schedule 6
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
ALLOCATION OF STOCK BASED COMPENSATION
(Unaudited, in Thousands)
Three Months Ended
September 30, 2007
----------------------------------
As
reported
on
Schedule Stock Based
1 Compensation Adjusted
---------- ------------- ---------
Operating expenses:
Wireline (exclusive of
depreciation and amortization) $ 45,801 $ (1,632) $ 44,169
Wireless (exclusive of
depreciation and amortization) 19,695 (207) 19,488
Depreciation and amortization 15,672 - 15,672
Loss on disposal of assets, net 113 - 113
---------- ------------- ---------
Total operating expenses $ 81,281 $ (1,839) $ 79,442
========== ============= =========
Nine Months Ended
September 30, 2007
----------------------------------
As
reported
on
Schedule Stock Based
1 Compensation Adjusted
---------- ------------- ---------
Operating expenses:
Wireline (exclusive of
depreciation and amortization) $ 134,166 $ (4,632) $ 129,534
Wireless (exclusive of
depreciation and amortization) 53,394 (540) 52,854
Depreciation and amortization 48,368 - 48,368
Loss on disposal of assets, net 137 - 137
---------- ------------- ---------
Total operating expenses $ 236,065 $ (5,172) $ 230,893
========== ============= =========
Three Months Ended
September 30, 2006(a)
----------------------------------
As
reported
on
Schedule Stock Based
1 Compensation Adjusted
----------- ------------- ---------
Operating expenses:
Wireline (exclusive of
depreciation and amortization) $ 43,147 $(1,792) $ 41,355
Wireless (exclusive of
depreciation and amortization) 16,667 (198) 16,469
Depreciation and amortization 14,538 - 14,538
Loss on disposal of assets, net - - -
---------- ------------- ---------
Total operating expenses $ 74,352 $(1,990) $ 72,362
========== ============= =========
Nine Months Ended
September 30, 2006(a)
----------------------------------
As
reported
on
Schedule Stock Based
1 Compensation Adjusted
----------- ------------- ---------
Operating expenses:
Wireline (exclusive of
depreciation and amortization) $126,789 $(4,763) $122,026
Wireless (exclusive of
depreciation and amortization) 45,412 (512) 44,900
Depreciation and amortization 47,669 - 47,669
Loss on disposal of assets, net 1,105 - 1,105
---------- ------------- ---------
Total operating expenses $220,975 $(5,275) $215,700
========== ============= =========
(a)Stock compensation has been adjusted by $322 and $384, for the
three and nine months ended September 30, 2006, to include stock
based compensation costs for non-employee directors.
Note:The balances reported on Schedule 1 - Consolidated Statements of
Operations, include the company's adoption of SFAS 123(R) - Share-
Based Payment. This schedule shows the company's operating
performance prior to that expense being recorded to allow analysis of
the operating segments without these non-cash charges.
Schedule 7
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
INVESTMENT IN CONSTRUCTION AND CAPITAL
(Unaudited, in Thousands)
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
September September September September
30, 30, 30, 30,
2007 2006 2007 2006
--------- --------- --------- ---------
Cash outlay for construction
and capital expenditures $ 15,938 $ 18,107 $ 39,502 $ 38,765
Non-cash capital lease - - 51 -
--------- --------- --------- ---------
Investment in construction and
capital $ 15,938 $ 18,107 $ 39,553 $ 38,765
========= ========= ========= =========
Growth 6,228 5,913 12,144 16,629
Maintenance and other 9,710 12,194 27,409 22,136
--------- --------- --------- ---------
Investment in construction and
capital $ 15,938 $ 18,107 $ 39,553 $ 38,765
========= ========= ========= =========
Schedule 8
ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.
KEY OPERATING STATISTICS
(Unaudited)
September 30, June 30, September 30,
2007 2007 2006
------------- --------- -------------
Local telephone:
Retail access lines 188,549 191,767 195,997
Resale access lines 9,976 9,989 12,045
UNE lines 33,111 36,822 51,089
------------- --------- -------------
Total local telephone access
lines 231,636 238,578 259,131
============= ========= =============
Average monthly local telephone
revenue per line for the
quarter $ 68.95 $ 65.35 $ 61.14
Quarterly growth rate in local
telephone access lines -2.9% -3.0% -1.4%
Wireless:
Retail wireless subscribers 141,501 139,384 126,089
Average monthly churn for the
quarter 1.7% 1.4% 1.5%
Average monthly revenue per
subscriber for the quarter(b) $ 64.43 $ 62.18 $ 62.94
Resale wireless subscribers 2,307 2,539 3,481
Total wireless subscribers 143,808 141,923 129,570
Average monthly churn for the
quarter(a) 1.7% 1.4% 1.6%
Average monthly revenue per
subscriber for the quarter(b) 64.11 $ 61.62 $ 60.77
Long Distance:
Long distance subscribers 64,511 64,684 61,984
Average monthly retail revenue
per subscriber for the quarter $ 24.19 $ 23.81 $ 24.64
Internet:
DSL subscribers 46,239 45,670 41,744
Dial-up subscribers 10,059 10,968 13,555
------------- --------- -------------
Total Internet subscribers 56,298 56,638 55,299
============= ========= =============
Average monthly DSL & dial-up
revenue per subscriber for the
quarter $ 29.83 $ 29.53 $ 29.40
(a)Prior year churn has been restated to negate the gross up of
installs and disconnects that were caused by certain account changes.
In prior periods, September 30, 2006 churn was reported at 1.9%.
(b)CETC added $10.89 and $9.92 to retail and total wireless ARPU in
the third and second quarters of 2007, respectively. It also added
$9.81 to retail and $9.82 to total ARPU, in the third quarter of
2006.
CONTACT: ACS Corporate Communications:
Director, Corporate Communications
Mary Gasperlin, 907-297-3000
mary.gasperlin@acsalaska.com
or
ACS Investors:
Investor Relations
Alaska Communications Systems, 907-564-7556
investors@acsalaska.com