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Telephone & Data Systems (TDS) Posts In-Line Earnings in Q4
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Telephone & Data Systems Inc. (TDS - Free Report) reported mixed financial results in the fourth quarter of 2016, wherein the top line lagged the Zacks Consensus Estimate while the bottom line met the consensus mark.
Telephone & Data Systems currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The company is a leading regional wireline voice and video service provider in the U.S. which competes with the likes of CenturyLink Inc. and Frontier Communications Corp. to name a few.
GAAP net loss in the fourth quarter of 2016 was $5 million or a loss of 5 cents per share compared with a net loss of $1 million or a loss of 1 cent per share in the year-ago quarter. Quarterly loss per share of 5 cents came in line with the Zacks Consensus Estimate.
Revenues were up 0.3% year over year to $1,278 million in the reported quarter, below the Zacks Consensus Estimate of $1,351.4 million. Operating expenses were $1,294 million, up 0.7% year over year. The company reported quarterly operating loss was $29 million compared with a loss of $24 million in the year-ago quarter.
United States Cellular Division
The company’s wireless subsidiary United States Cellular Corp. (USM - Free Report) reported fourth-quarter 2016 loss per share of 7 cents, narrower than the Zacks Consensus Estimate of 8 cents per share.
Quarterly revenues of $991 million were up 0.4% year over year but fell short of the Zacks Consensus Estimate of $1,022.6 million. Quarterly Service revenues decreased 8% to $737 million. Revenues from Equipment sales were up a substantial 37% to $254 million.
Quarterly postpaid ARPU (average revenue per user) decreased to $45.19 from $51.46 at the end of 2015. Postpaid ARPA (average revenue per account) was $120.67 compared with $131.96 at the end of 2015. Postpaid churn rose to 1.41% from 1.31% recorded at the end of 2015. Prepaid ARPU decreased to $33.25 from $35.54 recorded at the end of 2015. Prepaid churn increased to 5.44% in the reported quarter from 5.40% at 2015-end.
United States Cellular exited 2016 with a subscriber base of 5,031,000 compared with 4,876,000 at the end of 2015. Postpaid subscriber base totaled 4,482,000 compared with 4,409,000 at 2015-end. Meanwhile, prepaid subscriber base totaled 484,000 compared with 387,000 at the end of 2015. In the reported quarter, United States Cellular lost a net of 2,000 postpaid subscribers compared with the addition of 68,000 in the year-ago quarter. The company gained 4,000 prepaid customers in the same quarter compared with 7,000 in the prior-year quarter.
TDS Division
In the reported quarter, total revenue came in at $283 million, down 0.4% year over year. Within the segment, revenues from the wireline segment came in at $174 million, flat year over year. Cable revenues were $49 million, up 13% year over year while HMS revenues decreased 10% to $61 million.
Cash Flow
In the fourth quarter of 2016, Telephone & Data Systems generated $144 million of cash from operations compared with $63 million in the prior-year quarter. Quarterly adjusted free cash flow was a negative $64 million compared with a negative $178 million in the year-earlier quarter.
Liquidity
Telephone & Data Systems exited 2016 with cash and cash equivalents of $900 million compared with $985 million at the end of 2015. At 2016 end, total debt was $2,445 million compared with $2,440 million at 2015-end. At the end of 201, the debt-to-capitalization ratio stood at 0.34 compared with 0.26 at end-2015.
Subscriber Statistics
As of Dec 31, 2016, Telephone & Data Systems had 585,400 residential wireline connections compared with 582,700 in the year-ago quarter. Of the total, voice connections were 310,600, down 2.9%. Broadband Connections were 229,500, up 0.4%. IPTV connections were 45,300, up a substantial 31.7%. Quarterly total residential revenue per connection was $44.27 compared with $41.24 in the year-ago quarter.
The company exited 2016 with 329,700 commercial wireline connections, down 3.3% year over year. Of the total, voice connections were 157,400, down 8.2%. Broadband Connections were 21,400, down 4.5%. ManagedIP connections were 150,900, up 2.6%.
Total cable connections were 292,400, up 4.3% year over year. Of the total, Video connections were 99,000, down 7.3%. Broadband Connections were 133,700, up 14.2%. Voice connections were 59,600, up 5.7%.
Guidance for 2017
For 2017, Telephone & Data Systems projects total operating revenue in the range of $1,200–$1,250 million. Both operating cash flow and adjusted EBITDA are estimated in the band of $300–$340 million while capital expenditure is projected at around $225 million.
Telephone and Data Systems, Inc. Price, Consensus and EPS Surprise
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Telephone & Data Systems (TDS) Posts In-Line Earnings in Q4
Telephone & Data Systems Inc. (TDS - Free Report) reported mixed financial results in the fourth quarter of 2016, wherein the top line lagged the Zacks Consensus Estimate while the bottom line met the consensus mark.
Telephone & Data Systems currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The company is a leading regional wireline voice and video service provider in the U.S. which competes with the likes of CenturyLink Inc. and Frontier Communications Corp. to name a few.
GAAP net loss in the fourth quarter of 2016 was $5 million or a loss of 5 cents per share compared with a net loss of $1 million or a loss of 1 cent per share in the year-ago quarter. Quarterly loss per share of 5 cents came in line with the Zacks Consensus Estimate.
Revenues were up 0.3% year over year to $1,278 million in the reported quarter, below the Zacks Consensus Estimate of $1,351.4 million. Operating expenses were $1,294 million, up 0.7% year over year. The company reported quarterly operating loss was $29 million compared with a loss of $24 million in the year-ago quarter.
United States Cellular Division
The company’s wireless subsidiary United States Cellular Corp. (USM - Free Report) reported fourth-quarter 2016 loss per share of 7 cents, narrower than the Zacks Consensus Estimate of 8 cents per share.
Quarterly revenues of $991 million were up 0.4% year over year but fell short of the Zacks Consensus Estimate of $1,022.6 million. Quarterly Service revenues decreased 8% to $737 million. Revenues from Equipment sales were up a substantial 37% to $254 million.
Quarterly postpaid ARPU (average revenue per user) decreased to $45.19 from $51.46 at the end of 2015. Postpaid ARPA (average revenue per account) was $120.67 compared with $131.96 at the end of 2015. Postpaid churn rose to 1.41% from 1.31% recorded at the end of 2015. Prepaid ARPU decreased to $33.25 from $35.54 recorded at the end of 2015. Prepaid churn increased to 5.44% in the reported quarter from 5.40% at 2015-end.
United States Cellular exited 2016 with a subscriber base of 5,031,000 compared with 4,876,000 at the end of 2015. Postpaid subscriber base totaled 4,482,000 compared with 4,409,000 at 2015-end. Meanwhile, prepaid subscriber base totaled 484,000 compared with 387,000 at the end of 2015. In the reported quarter, United States Cellular lost a net of 2,000 postpaid subscribers compared with the addition of 68,000 in the year-ago quarter. The company gained 4,000 prepaid customers in the same quarter compared with 7,000 in the prior-year quarter.
TDS Division
In the reported quarter, total revenue came in at $283 million, down 0.4% year over year. Within the segment, revenues from the wireline segment came in at $174 million, flat year over year. Cable revenues were $49 million, up 13% year over year while HMS revenues decreased 10% to $61 million.
Cash Flow
In the fourth quarter of 2016, Telephone & Data Systems generated $144 million of cash from operations compared with $63 million in the prior-year quarter. Quarterly adjusted free cash flow was a negative $64 million compared with a negative $178 million in the year-earlier quarter.
Liquidity
Telephone & Data Systems exited 2016 with cash and cash equivalents of $900 million compared with $985 million at the end of 2015. At 2016 end, total debt was $2,445 million compared with $2,440 million at 2015-end. At the end of 201, the debt-to-capitalization ratio stood at 0.34 compared with 0.26 at end-2015.
Subscriber Statistics
As of Dec 31, 2016, Telephone & Data Systems had 585,400 residential wireline connections compared with 582,700 in the year-ago quarter. Of the total, voice connections were 310,600, down 2.9%. Broadband Connections were 229,500, up 0.4%. IPTV connections were 45,300, up a substantial 31.7%. Quarterly total residential revenue per connection was $44.27 compared with $41.24 in the year-ago quarter.
The company exited 2016 with 329,700 commercial wireline connections, down 3.3% year over year. Of the total, voice connections were 157,400, down 8.2%. Broadband Connections were 21,400, down 4.5%. ManagedIP connections were 150,900, up 2.6%.
Total cable connections were 292,400, up 4.3% year over year. Of the total, Video connections were 99,000, down 7.3%. Broadband Connections were 133,700, up 14.2%. Voice connections were 59,600, up 5.7%.
Guidance for 2017
For 2017, Telephone & Data Systems projects total operating revenue in the range of $1,200–$1,250 million. Both operating cash flow and adjusted EBITDA are estimated in the band of $300–$340 million while capital expenditure is projected at around $225 million.
Telephone and Data Systems, Inc. Price, Consensus and EPS Surprise
Telephone and Data Systems, Inc. Price, Consensus and EPS Surprise | Telephone and Data Systems, Inc. Quote
A Full-Blown Technological Breakthrough in the Making
Zacks’ Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>