TDS reports third quarter 2020 results

Rhea-AI Summary

On November 5, 2020, TDS reported third-quarter revenues of $1,324 million, a slight increase from $1,321 million a year ago. Net income attributed to TDS shareholders was $78 million with earnings per share at $0.66, up from $18 million or $0.15 in the previous year. UScellular showed strong performance with low churn and increased retail net additions. TDS Telecom expanded fiber deployment to 34% of service addresses, contributing to revenue growth. The company adjusted its 2020 estimates for UScellular and TDS Telecom.

Positive

• Third-quarter revenue increased to $1,324 million, up from $1,321 million year-over-year.
• Net income rose to $78 million from $18 million year-over-year.
• Earnings per share improved to $0.66 from $0.15 year-over-year.
• UScellular's retail net additions grew, benefiting from low churn rates.
• TDS Telecom's fiber deployment reached 280,000 addresses, or 34% of service areas.
• UScellular's adjusted EBITDA estimates were raised to $975-$1,050 million.

Negative

• No significant negative impacts reported.

CHICAGO, Nov. 5, 2020 /PRNewswire/ --

As previously announced, TDS will hold a teleconference November 6, 2020, at 9:00 a.m. CST. Listen to the call live via the Events & Presentations page of investors.tdsinc.com.   

Telephone and Data Systems, Inc. (NYSE:TDS) reported total operating revenues of $1,324 million for the third quarter of 2020, versus $1,321 million for the same period one year ago. Net income attributable to TDS shareholders and related diluted earnings per share were $78 million and $0.66, respectively, for the third quarter of 2020 compared to $18 million and $0.15, respectively, in the same period one year ago.

"The TDS Enterprise had a strong quarter," said LeRoy T. Carlson, Jr., TDS President and CEO. "Impressive financial results produced by UScellular and TDS Telecom demonstrate how much our customers value our essential communications and high-quality data services. Both businesses have lifted their expectations for 2020 financial performance. Our associates continue to show exceptional dedication and resilience in keeping our operations and networks performing at top levels for our customers.

"At UScellular, churn remained very low and retail net additions grew through an increase in connected devices. The positive impact of higher ARPU, combined with  operational and cost discipline throughout the quarter, helped  drive a strong increase in profitability, compared to the same period a year ago. LT Therivel has successfully transitioned into his new role as CEO. During the quarter UScellular successfully completed a 5G millimeter wave test data session showing significant expansion of signal reach and speed. This is important in enabling UScellular to move faster and more cost-efficiently in its 5G evolution and it will also leverage this technology to better serve its customers and help close the digital divide. UScellular has launched a new logo and brand identity with a modern look – a visual signal of how they are working to expand their brand appeal.

"At TDS Telecom, our fiber investments are delivering results. TDS Telecom grew its Wireline video and broadband connections, and combined with demand for higher broadband speeds, drove increases in average residential revenue per connection and total residential revenue. TDS Telecom continues its fiber strategy and has now deployed fiber to 280,000 or 34% of its wireline service addresses. Bolstered by the Continuum acquisition, cable operations produced an exceptional quarter with increased broadband connections generating a 19% growth in revenues and a strong increase in profitability."

2020 Estimated Results

TDS' current estimates of full-year 2020 results for UScellular and TDS Telecom are shown below. Such estimates represent management's view as of November 5, 2020 and should not be assumed to be current as of any future date. TDS undertakes no duty to update such estimates, whether as a result of new information, future events, or otherwise. There can be no assurance that final results will not differ materially from estimated results.

2020 Estimated Results
UScellular	Previous	Current
(Dollars in millions)
Service revenues	$3,000-$3,100	$3,025-$3,075
Adjusted OIBDA1	$725-$850	$800-$875
Adjusted EBITDA1	$900-$1,025	$975-$1,050
Capital expenditures	$850-$950	Unchanged

 

TDS Telecom	Previous	Current
(Dollars in millions)
Total operating revenues	$950-$1,000	Unchanged
Adjusted OIBDA1	$280-$310	$300-$320
Adjusted EBITDA1	$290-$320	$305-$325
Capital expenditures	$300-$350	Unchanged

The following tables provide reconciliations of Net income to Adjusted OIBDA and Adjusted EBITDA for 2020 estimated results, actual results for the nine months ended September 30, 2020, and actual results for the year ended December 31, 2019. In providing 2020 estimated results, TDS has not completed the below reconciliation to Net income because it does not provide guidance for income taxes. Although potentially significant, TDS believes that the impact of income taxes cannot be reasonably predicted; therefore, TDS is unable to provide such guidance.

2020 Estimated Results
	UScellular			TDS Telecom
(Dollars in millions)
Net income (GAAP)	N/A			N/A
Add back:
Income tax expense	N/A			N/A
Income before income taxes (GAAP)	$165-$240			$95-$115
Add back:
Interest expense	110			—
Depreciation, amortization and accretion expense	680			210
EBITDA (Non-GAAP)1	$955-$1,030			$305-$325
Add back or deduct:
(Gain) loss on asset disposals, net	20			—
Adjusted EBITDA (Non-GAAP)1	$975-$1,050			$305-$325
Deduct:
Equity in earnings of unconsolidated entities	170			—
Interest and dividend income	5			5
Adjusted OIBDA (Non-GAAP)1	$800-$875			$300-$320

 

	Actual Results
	Nine Months Ended September 30, 2020								Year Ended December 31, 2019
	UScellular				TDS Telecom				UScellular				TDS Telecom
(Dollars in millions)
Net income (GAAP)	$	227			$	81			$	133			$	92
Add back:
Income tax expense	11				13				52				30
Income before income taxes (GAAP)	$	238			$	94			$	185			$	122
Add back:
Interest expense	76				(3)				110				(3)
Depreciation, amortization and accretion expense	516				152				702				200
EBITDA (Non-GAAP)1	$	830			$	243			$	997			$	320
Add back or deduct:
(Gain) loss on asset disposals, net	14				1				19				(7)
(Gain) loss on sale of business and other exit costs, net	—				—				(1)				—
(Gain) loss on investments	(3)				—				—				—
Adjusted EBITDA (Non-GAAP)1	$	841			$	243			$	1,015			$	313
Deduct:
Equity in earnings of unconsolidated entities	137				—				166				—
Interest and dividend income	6				4				17				12
Other, net	—				(1)				—				—
Adjusted OIBDA (Non-GAAP)1	$	698			$	240			$	832			$	300

Numbers may not foot due to rounding.
1	EBITDA, Adjusted EBITDA and Adjusted OIBDA are defined as net income adjusted for the items set forth in the reconciliation above. EBITDA, Adjusted EBITDA and Adjusted OIBDA are not measures of financial performance under Generally Accepted Accounting Principles in the United States (GAAP) and should not be considered as alternatives to Net income or Cash flows from operating activities, as indicators of cash flows or as measures of liquidity. TDS does not intend to imply that any such items set forth in the reconciliation above are non-recurring, infrequent or unusual; such items may occur in the future. Management uses Adjusted EBITDA and Adjusted OIBDA as measurements of profitability, and therefore reconciliations to Net income are deemed appropriate. Management believes Adjusted EBITDA and Adjusted OIBDA are useful measures of TDS' operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS' financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management's evaluation of business performance. Adjusted EBITDA shows adjusted earnings before interest, taxes, depreciation, amortization and accretion, and gains and losses, while Adjusted OIBDA reduces this measure further to exclude Equity in earnings of unconsolidated entities and Interest and dividend income in order to more effectively show the performance of operating activities excluding investment activities. The table above reconciles EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measure, Net income or Income before income taxes. Additional information and reconciliations related to Non-GAAP financial measures for September 30, 2020, can be found on TDS' website at investors.tdsinc.com.

Conference Call Information

TDS will hold a conference call on November 6, 2020 at 9:00 a.m. Central Time.

• Access the live call on the Events & Presentations page of investors.tdsinc.com or at https://www.webcaster4.com/Webcast/Page/1145/38510.
• Access the call by phone at (833) 968-2187, conference ID: 7289911.

Before the call, certain financial and statistical information to be discussed during the call will be posted to investors.tdsinc.com. The call will be archived on the Events & Presentations page of investors.tdsinc.com. 

About TDS

Telephone and Data Systems, Inc. (TDS), a Fortune 1000^® company, provides wireless; cable and wireline broadband, video and voice; and hosted and managed services to approximately 6 million connections nationwide through its businesses, UScellular, TDS Telecom, BendBroadband and OneNeck IT Solutions. Founded in 1969 and headquartered in Chicago, TDS employed 9,300 people as of September 30, 2020.

Visit investors.tdsinc.com for comprehensive financial information, including earnings releases, quarterly and annual filings, shareholder information and more.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company's plans, beliefs, estimates, and expectations. These statements are based on current estimates, projections, and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: the impact, duration and severity of the COVID-19 pandemic; intense competition; the ability to execute TDS' business strategy; uncertainties in TDS' future cash flows and liquidity and access to the capital markets; the ability to make payments on TDS and UScellular indebtedness or comply with the terms of debt covenants; the ability to obtain or maintain roaming arrangements with other carriers on acceptable terms; the ability to obtain access to adequate radio spectrum to meet current or anticipated future needs, including participation in FCC auctions; the state and federal regulatory environment; the ability to attract people of outstanding talent throughout all levels of the organization; conditions in the U.S. telecommunications industry; TDS' smaller scale relative to larger competitors; changes in demand, consumer preferences, price competition, or  churn rates; advances in  technology; the value of assets and investments; impacts of costs, integration problems or other factors associated with acquisitions, divestitures or exchanges of properties or licenses and/or expansion of TDS' businesses; the ability of the company to successfully construct and manage its networks; difficulties involving third parties; cyber-attacks or other breaches of network or information technology security; changes in facts and circumstances that could require TDS to record adjustments to amounts reflected in the financial statements; disruption in credit or other financial markets; deterioration of U.S. or global economic conditions; pending and future litigation. Investors are encouraged to consider these and other risks and uncertainties that are more fully described under "Risk Factors" in the most recent filing of TDS' Form 10-K, as updated by any TDS Form 10-Q filed subsequent to such Form 10-K. 

The impact of the COVID-19 pandemic on TDS' business is uncertain, but depending on its duration and severity it could have a material adverse effect on TDS' business, financial condition or results of operations.

The impact of the global spread of COVID-19 on TDS' future operations is uncertain. Public health emergencies, such as COVID-19, pose the risk that TDS or its associates, agents, partners and suppliers may be unable to conduct business activities for an extended period of time and/or provide the level of service expected. TDS' ability to attract customers, maintain an adequate supply chain and execute on its business strategies and initiatives could be negatively impacted by this outbreak. Additionally, COVID-19 has caused and could continue to cause increased unemployment, economic downturn and credit market deterioration, all of which could negatively impact TDS. The extent of the impact of COVID-19 on TDS' business, financial condition and results of operations will depend on future circumstances, including the severity of the disease, the duration of the outbreak, actions taken by governmental authorities and other possible direct and indirect consequences, all of which are uncertain and cannot be predicted.

For more information about TDS and its subsidiaries, visit:
TDS: www.tdsinc.com 
UScellular: www.uscellular.com 
TDS Telecom: www.tdstelecom.com 
OneNeck IT Solutions: www.oneneck.com

United States Cellular Corporation
Summary Operating Data (Unaudited)
As of or for the Quarter Ended	9/30/2020				6/30/2020				3/31/2020				12/31/2019				9/30/2019
Retail Connections
Postpaid
Total at end of period	4,401,000				4,372,000				4,359,000				4,383,000				4,395,000
Gross additions	168,000				129,000				132,000				170,000				163,000
Feature phones	4,000				3,000				2,000				2,000				3,000
Smartphones	98,000				82,000				88,000				128,000				121,000
Connected devices	66,000				44,000				42,000				40,000				39,000
Net additions (losses)	28,000				12,000				(26,000)				(12,000)				(19,000)
Feature phones	(8,000)				(8,000)				(10,000)				(11,000)				(11,000)
Smartphones	8,000				11,000				(10,000)				13,000				9,000
Connected devices	28,000				9,000				(6,000)				(14,000)				(17,000)
ARPU1	$	47.10			$	46.24			$	47.23			$	46.57			$	46.16
ARPA2	$	123.27			$	120.70			$	122.92			$	120.99			$	119.87
Churn rate3	1.06		%		0.89		%		1.21		%		1.38		%		1.38		%
Handsets	0.88		%		0.71		%		0.95		%		1.11		%		1.09		%
Connected devices	2.35		%		2.24		%		3.11		%		3.44		%		3.44		%
Prepaid
Total at end of period	506,000				496,000				494,000				506,000				510,000
Gross additions	65,000				62,000				57,000				63,000				70,000
Net additions (losses)	11,000				2,000				(12,000)				(3,000)				9,000
ARPU1	$	35.45			$	34.89			$	34.07			$	34.11			$	34.35
Churn rate3	3.59		%		4.05		%		4.67		%		4.40		%		4.03		%
Total connections at end of period4	4,962,000				4,919,000				4,903,000				4,941,000				4,957,000
Market penetration at end of period
Consolidated operating population	31,314,000				31,292,000				31,292,000				30,740,000				31,310,000
Consolidated operating penetration5	16		%		16		%		16		%		16		%		16		%
Capital expenditures (millions)	$	216			$	168			$	236			$	243			$	170
Total cell sites in service	6,758				6,673				6,629				6,578				6,554
Owned towers	4,246				4,208				4,184				4,166				4,123

1	Average Revenue Per User (ARPU) - metric is calculated by dividing a revenue base by an average number of connections and by the number of months in the period. These revenue bases and connection populations are shown below:
	•	Postpaid ARPU consists of total postpaid service revenues and postpaid connections.
	•	Prepaid ARPU consists of total prepaid service revenues and prepaid connections.
2	Average Revenue Per Account (ARPA) - metric is calculated by dividing total postpaid service revenues by the average number of postpaid accounts and by the number of months in the period.
3	Churn rate represents the percentage of the connections that disconnect service each month. These rates represent the average monthly churn rate for each respective period.
4	Includes reseller and other connections.
5	Market penetration is calculated by dividing the number of wireless connections at the end of the period by the total population of consolidated operating markets as estimated by Nielsen.

 

TDS Telecom
Summary Operating Data (Unaudited)
As of or for the Quarter Ended	9/30/2020				6/30/2020				3/31/2020				12/31/2019				9/30/2019
TDS Telecom
Wireline
Residential connections
Voice1	260,000				261,800				259,100				262,100				266,100
Broadband2	260,700				255,100				242,700				241,300				242,200
Video3	62,300				61,400				59,000				58,500				57,300
Wireline residential connections	583,000				578,300				560,700				561,900				565,600
Total residential revenue per connection4	$	51.45			$	49.73			$	50.12			$	49.11			$	49.02
Commercial connections
Voice1	109,400				112,400				114,400				117,800				121,200
Broadband2	20,800				20,700				20,500				20,400				20,600
managedIP5	114,900				115,500				118,300				121,200				124,500
Video3	200				200				100				100				400
Wireline commercial connections	245,400				248,700				253,400				259,600				266,600
Total Wireline connections	828,400				827,000				814,200				821,500				832,300
Cable
Cable residential and commercial connections
Broadband6	206,200				203,700				196,800				193,500				174,900
Video7	101,800				103,400				105,100				106,600				98,000
Voice8	67,700				69,000				68,900				69,500				63,900
managedIP5	1,800				1,800				1,400				1,300				1,200
Total Cable connections	377,400				378,000				372,300				370,900				338,000

Numbers may not foot due to rounding.
1	The individual circuits connecting a customer to Wireline's central office facilities that provide voice services.
2	The number of Wireline customers provided high-capacity data circuits via various technologies, including DSL and dedicated internet circuit technologies.
3	The number of Wireline customers provided video services.
4	Total residential revenue per connection is calculated by dividing total Wireline residential revenue by the average number of Wireline residential connections and by the number of months in the period.
5	The number of telephone handsets, data lines and IP trunks providing communications using IP networking technology.
6	Billable number of lines into a building for high-speed data services.
7	Generally, a home or business receiving video programming counts as one video connection. In counting bulk residential or commercial connections, such as an apartment building or hotel, connections are counted based on the number of units/rooms within the building receiving service.
8	Billable number of lines into a building for voice services.

 

TDS Telecom
Capital Expenditures (Unaudited)
Quarter Ended	9/30/2020				6/30/2020								3/31/2020									12/31/2019											9/30/2019
(Dollars in millions)
Wireline	$	74			$	58							$		39							$		98									$	61
Cable	18				17								15									26											20
Total TDS Telecom	$	92			$	75							$		54							$		124									$	81

Telephone and Data Systems, Inc.
Consolidated Statement of Operations Highlights
(Unaudited)
							Three Months Ended September 30,																		Nine Months Ended September 30,
							2020					2019						2020 vs. 2019							2020				2019								2020 vs. 2019
(Dollars and shares in millions, except per share amounts)
Operating revenues
UScellular							$	1,027				$		1,031				–							$	2,964			$		2,970						–
TDS Telecom							247					231						7			%				728				695								5	%
All Other1							50					59						(16)			%				157				175								(10)	%
							1,324					1,321						–							3,849				3,840								–
Operating expenses
UScellular
Expenses excluding depreciation, amortization and accretion							795					823						(3)			%				2,266				2,319								(2)	%
Depreciation, amortization and accretion							161					181						(11)			%				516				524								(2)	%
(Gain) loss on asset disposals, net							6					5						15			%				14				13								10	%
(Gain) loss on sale of business and other exit costs, net							—					—						N/M							—				(1)								N/M
(Gain) loss on license sales and exchanges, net							—					2						N/M							—				—								N/M
							962					1,011						(5)			%				2,796				2,855								(2)	%
TDS Telecom
Expenses excluding depreciation, amortization and accretion							169					162						4			%				488				467								4	%
Depreciation, amortization and accretion							49					50						–							152				150								2	%
(Gain) loss on asset disposals, net							—					—						65			%				1				(7)								N/M
							219					212						3			%				641				609								5	%
All Other1
Expenses excluding depreciation and amortization							50					62						(19)			%				157				182								(13)	%
Depreciation and amortization							7					6						(26)			%				17				23								(24)	%
(Gain) loss on asset disposals, net							—					1						(96)			%				—				(1)								71	%
							56					69						(20)			%				174				205								(14)	%
Total operating expenses							1,237					1,292						(4)			%				3,611				3,669								(2)	%
Operating income (loss)
UScellular							65					20						N/M							168				115								46	%
TDS Telecom							28					20						44			%				87				86								2	%
All Other1							(6)					(11)						45			%				(17)				(30)								39	%
							87					29						N/M							238				171								39	%
Investment and other income (expense)
Equity in earnings of unconsolidated entities							48					44						10			%				138				129								7	%
Interest and dividend income							4					7						(49)			%				12				24								(52)	%
Gain (loss) on investments							3					—						N/M							3				—								N/M
Interest expense							(43)					(42)						(1)			%				(119)				(128)								8	%
Other, net							—					—						(60)			%				(1)				—								(58)	%
Total investment and other income							12					9						38			%				33				25								35	%
Income before income taxes							99					38						N/M							271				196								38	%
Income tax expense							6					15						(61)			%				17				64								(73)	%
Net income							93					23						N/M							254				132								92	%
Less: Net income attributable to noncontrolling interests, net of tax							15					5						N/M							42				22								87	%
Net income attributable to TDS shareholders							$	78				$		18				N/M							$	212			$		110						93	%
Basic weighted average shares outstanding							114					115						–							114				114								–
Basic earnings per share attributable to TDS shareholders							$	0.68				$		0.15				N/M							$	1.85			$		0.96						93	%
Diluted weighted average shares outstanding							115					116						–							115				116								–
Diluted earnings per share attributable to TDS shareholders							$	0.66				$		0.15				N/M							$	1.81			$		0.93						94	%

N/M - Percentage change not meaningful.
Numbers may not foot due to rounding.
1	Consists of TDS corporate, intercompany eliminations and all other business operations not included in the UScellular and TDS Telecom segments.

 

Telephone and Data Systems, Inc.
Consolidated Statement of Cash Flows
(Unaudited)
	Nine Months Ended September 30,
	2020				2019
(Dollars in millions)
Cash flows from operating activities
Net income	$	254			$	132
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
Depreciation, amortization and accretion	685				697
Bad debts expense	55				80
Stock-based compensation expense	39				47
Deferred income taxes, net	217				23
Equity in earnings of unconsolidated entities	(138)				(129)
Distributions from unconsolidated entities	118				100
(Gain) loss on asset disposals, net	15				5
(Gain) loss on sale of business and other exit costs, net	—				(1)
(Gain) loss on investments	(3)				—
Other operating activities	1				4
Changes in assets and liabilities from operations
Accounts receivable	26				(42)
Equipment installment plans receivable	13				(42)
Inventory	2				3
Accounts payable	95				(4)
Customer deposits and deferred revenues	(21)				(2)
Accrued taxes	(156)				37
Accrued interest	14				9
Other assets and liabilities	(50)				(43)
Net cash provided by operating activities	1,166				874
Cash flows from investing activities
Cash paid for additions to property, plant and equipment	(914)				(631)
Cash paid for licenses	(169)				(257)
Cash received from investments	1				29
Cash paid for investments	(1)				(11)
Cash received from divestitures and exchanges	1				32
Other investing activities	4				1
Net cash used in investing activities	(1,078)				(837)
Cash flows from financing activities
Issuance of long-term debt	675				—
Repayment of long-term debt	(8)				(16)
TDS Common Shares reissued for benefit plans, net of tax payments	(3)				(6)
UScellular Common Shares reissued for benefit plans, net of tax payments	(11)				(8)
Repurchase of TDS Common Shares	(14)				—
Repurchase of UScellular Common Shares	(23)				(21)
Dividends paid to TDS shareholders	(58)				(57)
Payment of debt issuance costs	(23)				(1)
Distributions to noncontrolling interests	(2)				(3)
Other financing activities	1				9
Net cash provided by (used in) financing activities	534				(103)
Net increase (decrease) in cash, cash equivalents and restricted cash	622				(66)
Cash, cash equivalents and restricted cash
Beginning of period	474				927
End of period	$	1,096			$	861

 

Telephone and Data Systems, Inc.
Consolidated Balance Sheet Highlights
(Unaudited)
ASSETS
	September 30, 2020				December 31, 2019
(Dollars in millions)
Current assets
Cash and cash equivalents	$	1,076			$	465
Accounts receivable, net	1,056				1,124
Inventory, net	164				169
Prepaid expenses	109				98
Income taxes receivable	226				36
Other current assets	39				29
Total current assets	2,670				1,921
Assets held for sale	19				—
Licenses	2,637				2,480
Goodwill	547				547
Other intangible assets, net	219				239
Investments in unconsolidated entities	508				488
Property, plant and equipment, net	3,727				3,527
Operating lease right-of-use assets	988				972
Other assets and deferred charges	580				607
Total assets	$	11,895			$	10,781

 

Telephone and Data Systems, Inc.
Consolidated Balance Sheet Highlights
(Unaudited)
LIABILITIES AND EQUITY
	September 30, 2020				December 31, 2019
(Dollars in millions, except per share amounts)
Current liabilities
Current portion of long-term debt	$	3			$	10
Accounts payable	399				374
Customer deposits and deferred revenues	168				189
Accrued interest	24				11
Accrued taxes	63				41
Accrued compensation	107				121
Short-term operating lease liabilities	125				116
Other current liabilities	76				100
Total current liabilities	965				962
Deferred liabilities and credits
Deferred income tax liability, net	893				676
Long-term operating lease liabilities	938				931
Other deferred liabilities and credits	530				481
Long-term debt, net	2,970				2,316
Noncontrolling interests with redemption features	10				11
Equity
TDS shareholders' equity
Series A Common and Common Shares, par value $0.01 per share	1				1
Capital in excess of par value	2,479				2,468
Treasury shares, at cost	(478)				(479)
Accumulated other comprehensive loss	(7)				(9)
Retained earnings	2,809				2,672
Total TDS shareholders' equity	4,804				4,653
Noncontrolling interests	785				751
Total equity	5,589				5,404
Total liabilities and equity	$	11,895			$	10,781

 

Balance Sheet Highlights
(Unaudited)
	September 30, 2020
					TDS				TDS Corporate				Intercompany				TDS
	UScellular				Telecom				& Other				Eliminations				Consolidated
(Dollars in millions)
Cash and cash equivalents	$	931			$	573			$	147			$	(575)			$	1,076
Licenses, goodwill and other intangible assets	$	2,628			$	766			$	9			$	—			$	3,403
Investment in unconsolidated entities	467				4				48				(11)				508
	$	3,095			$	770			$	57			$	(11)			$	3,911
Property, plant and equipment, net	$	2,322			$	1,303			$	102			$	—			$	3,727
Long-term debt, net:
Current portion	$	2			$	—			$	1			$	—			$	3
Non-current portion	2,108				4				858				—				2,970
	$	2,110			$	4			$	859			$	—			$	2,973

 

TDS Telecom Highlights
(Unaudited)
	Three Months Ended September 30,											Nine Months Ended September 30,
	2020				2019				2020 vs. 2019			2020				2019				2020 vs. 2019
(Dollars in millions)
Wireline
Operating revenues
Residential	$	90			$	83			8	%		$	260			$	245			6	%
Commercial	38				41				(8)	%		115				127				(9)	%
Wholesale	45				45				1	%		136				139				(2)	%
Total service revenues	173				169				2	%		511				512				–
Equipment and product sales	—				—				4	%		1				1				(30)	%
	173				169				2	%		512				512				–
Operating expenses
Cost of services	69				68				2	%		197				195				1	%
Cost of equipment and products	—				—				(25)	%		1				1				(30)	%
Selling, general and administrative expenses	51				52				(3)	%		148				148				(1)	%
Expenses excluding depreciation, amortization and accretion	120				120				–			345				344				–
Depreciation, amortization and accretion	30				33				(8)	%		94				99				(5)	%
(Gain) loss on asset disposals, net	—				—				(70)	%		—				(8)				N/M
	150				153				(2)	%		439				435				1	%
Operating income	$	23			$	16			42	%		$	73			$	78			(6)	%
Cable
Operating revenues
Residential	$	62			$	52			21	%		$	182			$	152			20	%
Commercial	12				10				13	%		34				32				9	%
	74				62				19	%		216				184				18	%
Operating expenses
Cost of services	31				27				15	%		91				79				15	%
Selling, general and administrative expenses	18				15				23	%		52				44				18	%
Expenses excluding depreciation, amortization and accretion	49				42				18	%		143				124				16	%
Depreciation, amortization and accretion	20				17				15	%		59				51				15	%
(Gain) loss on asset disposals, net	—				—				N/M			1				1				(14)	%
	69				59				17	%		202				175				15	%
Operating income (loss)	$	5			$	3			55	%		$	14			$	8			76	%
Total TDS Telecom operating income	$	28			$	20			44	%		$	87			$	86			2	%

N/M - Percentage change not meaningful.

Numbers may not foot due to rounding.

 

Telephone and Data Systems, Inc. Financial Measures and Reconciliations (Unaudited)
Free Cash Flow
	Three Months Ended September 30,								Nine Months Ended September 30,
	2020				2019				2020				2019
(Dollars in millions)
Cash flows from operating activities (GAAP)	$	359			$	282			$	1,166			$	874
Less: Cash paid for additions to property, plant and equipment	304				238				914				631
Free cash flow (Non-GAAP)1	$	55			$	44			$	252			$	243

1	Free cash flow is a non-GAAP financial measure which TDS believes may be useful to investors and other users of its financial information in evaluating liquidity, specifically, the amount of net cash generated by business operations after deducting Cash paid for additions to property, plant and equipment.

 

 

View original content:http://www.prnewswire.com/news-releases/tds-reports-third-quarter-2020-results-301167486.html

SOURCE Telephone and Data Systems, Inc.

FAQ

What were the third-quarter revenues reported by TDS for 2020?

TDS reported third-quarter revenues of $1,324 million.

How much did TDS earn in net income for the third quarter of 2020?

TDS earned $78 million in net income for the third quarter of 2020.

What was TDS's earnings per share for Q3 2020?

The earnings per share for TDS in Q3 2020 was $0.66.

How did UScellular perform in the third quarter of 2020?

UScellular reported low churn and increased retail net additions in Q3 2020.

What is TDS's fiber deployment status as of Q3 2020?

As of Q3 2020, TDS has deployed fiber to 280,000 addresses, or 34% of its service areas.