U.S. Cellular Reports Second Quarter 2013 Results

02 Aug, 2013, 08:03 ET from United States Cellular Corporation

CHICAGO, Aug. 2, 2013 /PRNewswire/ -- As previously announced, U.S. Cellular will hold a teleconference Aug. 2, 2013 at 9:30 a.m. CDT. Listen to the live call via the Conference Calls page of teldta.com or uscellular.com.

United States Cellular Corporation (NYSE: USM) reported service revenues of $911.0 million for the second quarter of 2013, versus $1,029.7 million for the comparable period one year ago. Net income attributable to U.S. Cellular shareholders and related diluted earnings per share were $143.4 million and $1.69 respectively, for the second quarter of 2013, compared to $52.7 million and $0.62, respectively, in the comparable period one year ago.

The following significant events occurred during the second quarter of 2013:

  • On April 3, U.S. Cellular deconsolidated the St. Lawrence Seaway RSA Cellular Partnership ("NY1") and the New York RSA 2 Cellular Partnership ("NY2"). As a result, the NY1 and NY2 partnerships results are now reported using the equity method of accounting for investments in its consolidated financial statements. U.S. Cellular has retained the same ownership percentage and will continue to report the same percentage of income.
  • On May 16, U.S. Cellular's previously announced transaction to sell its Chicago, St. Louis, central Illinois and three other markets (the "Divestiture Transaction") closed and the company received $480 million in cash and recognized a pre-tax gain of $266.4 million.
  • On June 25, U.S. Cellular paid a special dividend of $5.75 per Common Share and Series A Common Share, for a total of $482.3 million.

"We have taken significant steps this year to improve U.S. Cellular's competitive position and financial foundation," said Kenneth R. Meyers, U.S. Cellular president and CEO. "We divested underperforming markets in May to focus on higher potential markets, and we returned value to shareholders through a special, one-time dividend. In June, we announced an agreement to monetize non-strategic spectrum at a significant valuation.

"In the second half, we are continuing to execute aggressive strategies to accelerate customer growth and reduce expenses. We're working to complete the 4G LTE network expansion as we prepare to offer an even more competitive device portfolio with the introduction of Apple products later this year. We also plan to begin offering shared data plans, supported by a new billing and operations support system that enables us to bring new services and products to market faster."

2013 ESTIMATES

U.S. Cellular's estimates of full-year 2013 results are shown below.  Such estimates represent U.S. Cellular's views as of the date of filing U.S. Cellular's Form 10-Q for the quarter ended June 30, 2013.  Such forward‑looking statements should not be assumed to be current as of any future date.  U.S. Cellular undertakes no duty to update such information, whether as a result of new information, future events or otherwise.  There can be no assurance that final results will not differ materially from such estimated results.

2013 Estimated Results (1)

Core Markets (2)

Divestiture Markets (2)(3)

U.S. Cellular Consolidated (2)(3)

Previous

Current

Previous

Current

Previous

Current

(Dollars in millions)

Service revenues

Unchanged

$3,475 - $3,575

$145 - $165

$140

$3,620 - $3,740

$3,615-$3,715

Adjusted income before income taxes (4)

Unchanged

$560 - $660

$35 - $55

$40

$595 - $715

$600-$700

Capital expenditures

Unchanged

$730

Unchanged

$5

Unchanged

$735

 

(1)

These estimates are based on U.S. Cellular's current plans, which include an expansion of the multi-year deployment of 4G LTE technology; such expansion includes deployment on 700 MHz in additional markets as well as deployment on the 850 MHz band to provide additional capacity for future growth in data usage, enable potential future 4G LTE roaming, and support the sale of Apple products. The financial impacts of selling Apple products in 2013 consist of the following:

  • Increased Service revenues resulting from net incremental customers added and retained as a result of offering Apple products;
  • Decreased Adjusted income before income taxes as a result of net increases in costs, primarily loss on equipment sales as a result of offering Apple products; and
  • Increased Capital expenditures related to the deployment on the 850 MHz band to provide additional capacity for future growth in data usage, which includes capacity required to accommodate Apple products.

These estimates also reflect the impacts of the deconsolidation of certain partnerships as of April 2013. These estimates do not include (i) the reported gain on sale of business and other exit costs, net (ii) the reported gain on investments, or (iii) the expected gains from pending spectrum license divestitures. New developments or changing conditions (such as, but not limited to, regulatory developments, customer net growth, customer demand for data services or possible acquisitions, dispositions or exchanges) could affect U.S. Cellular's plans and, therefore, its 2013 estimated results.

(2)

The U.S. Cellular Consolidated amounts represent GAAP financial measures and include the results of both the Core Markets and the Divestiture Markets. The amounts for the Core Markets and Divestiture Markets represent non-GAAP financial measures. U.S. Cellular believes that the amounts for the Core Markets and Divestiture Markets may be useful to investors and other users of its financial information in evaluating the separate results for the Core Markets. Divestiture Markets are comprised of U.S. Cellular's Chicago, central Illinois, St. Louis and certain Indiana/Michigan/Ohio markets. Core Markets are comprised of all other markets in which U.S. Cellular conducts business including Peoria, Rockford and certain other areas in Illinois, and in Columbia, Joplin, Jefferson City and certain other areas in Missouri. Core Markets as defined also includes any other income or expenses due to U.S. Cellular's direct or indirect ownership interests in other spectrum in the Divestiture Markets which was not included in the sale and other retained assets from the Divestiture Markets.

(3)

These estimates reflect the Divestiture Transaction which closed on May 16, 2013.

(4)

Adjusted income before income taxes is a non-GAAP financial measure defined as Income before income taxes, adjusted for: Depreciation, amortization and accretion, net Gain or loss on sale of business and other exit costs (if any), net Gain or loss on investments (if any), and Interest expense. Adjusted income before income taxes excludes these items in order to show operating results on a more comparable basis from period to period. In the future, U.S. Cellular may also exclude other items from adjusted income before income taxes if such items may help reflect operating results on a more comparable basis. U.S. Cellular does not intend to imply that any such amounts that are excluded are non-recurring, infrequent or unusual; such amounts may occur in the future. Adjusted income before income taxes is not a measure of financial performance under GAAP and should not be considered as an alternative to Income before income taxes as an indicator of the Company's operating performance or as an alternative to Cash flows from operating activities, determined in accordance with GAAP, as an indicator of cash flows or as a measure of liquidity. The following tables provide a reconciliation of Income (loss) before income taxes to Adjusted income before income taxes for 2013 Estimated Results, six months ended June 30, 2013 actual results, and 2012 actual results:

2013 Estimated Results

Core Markets (2)

Divestiture Markets (2)(3)

U.S. Cellular Consolidated (2)(3)

(Dollars in millions)

Income (loss) before income taxes

($10)-$90

$30

$20-$120

Depreciation, amortization and accretion expense (5)

$540

$250

$790

(Gain) loss on sale of business and other exit costs, net

($240)

($240)

(Gain) loss on investments

($20)

($20)

Interest expense

$50

$50

Adjusted income before income taxes

$560-$660

$40

$600-$700

U.S. Cellular Consolidated Actual Results

Six Months Ended

June 30, 2013

Year Ended

December 31, 2012

Income before income taxes

$ 282

$ 205

Depreciation, amortization and accretion expense (5)

393

609

(Gain) loss on sale of business and other exit costs, net

(242)

21

(Gain) loss on investments

(19)

4

Interest expense

21

42

Adjusted income before income taxes

$ 435

$ 881

 

(5)

The 2013 estimated amount for Depreciation, amortization and accretion expense in the Divestiture Markets includes approximately $168 million of incremental accelerated depreciation, amortization and accretion resulting from the Divestiture Transaction. Actual results for the six months ended June 30, 2013 and the year ended December 31, 2012 include $88 million and $20 million, respectively, of incremental accelerated depreciation, amortization and accretion resulting from the Divestiture Transaction.

Conference Call Information

U.S. Cellular will hold a conference call on Aug. 2, 2013 at 9:30 a.m. CDT.

Before the call, certain financial and statistical information to be discussed during the call will be posted to the Conference Calls page of uscellular.com. The call will be archived on the Conference Calls page of uscellular.com.

About U.S. Cellular®

United States Cellular Corporation provides a comprehensive range of wireless products and services, excellent customer support, and a high-quality network to 5.0 million customers in 23 states. The Chicago-based company had 7,000 full- and part-time associates as of June 30, 2013. At the end of the year, Telephone and Data Systems, Inc. owned 84 percent of U.S. Cellular. For more information about U.S. Cellular, visit uscellular.com.

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: impacts of the Divestiture Transaction including, but not limited to, the ability to obtain regulatory approvals, successfully complete the transaction and the financial impacts of such transaction; the ability of the company to successfully manage and grow its markets; the overall economy; competition; the ability to obtain or maintain roaming arrangements with other carriers on acceptable terms; the state and federal telecommunications regulatory environment; the value of assets and investments; adverse changes in the ratings afforded our debt securities by accredited ratings organizations; industry consolidation; advances in telecommunications technology; uncertainty of access to the capital markets;  pending and future litigation; changes in income tax rates, laws, regulations or rulings; acquisitions/divestitures of properties and/or licenses; and changes in customer growth rates, average monthly revenue per user, churn rates, roaming revenue and terms, the availability of handset devices, or the mix of products and services offered by the company. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K Current Report used by U.S. Cellular to furnish this press release to the Securities and Exchange Commission ("SEC"), which are incorporated by reference herein.

For more information about U.S. Cellular, visit uscellular.com.

United States Cellular Corporation

Total Markets Summary Operating Data (Unaudited)

Quarter Ended

6/30/2013

3/31/2013

12/31/2012

9/30/2012

6/30/2012

Retail Customers

Postpaid

Total at end of period

4,412,000

5,060,000

5,134,000

5,175,000

5,213,000

Gross additions

165,000

191,000

241,000

230,000

199,000

Net additions (losses)

(120,000)

(74,000)

(41,000)

(38,000)

(48,000)

ARPU (1)

$

54.18

$

54.85

$

54.56

$

54.34

$

54.42

Churn rate (2)

2.0%

1.7%

1.8%

1.7%

1.6%

Smartphone penetration (3) (4)

45.5%

43.5%

41.8%

38.6%

36.8%

Prepaid

Total at end of period

381,000

446,000

423,000

386,000

329,000

Gross additions

77,000

104,000

107,000

120,000

78,000

Net additions (losses)

(7,000)

23,000

37,000

57,000

20,000

ARPU (1)

$

31.69

$

33.31

$

33.56

$

32.97

$

33.59

Churn rate (2)

6.8%

6.2%

5.8%

5.9%

6.2%

Total customers at end of period

4,968,000

5,736,000

5,798,000

5,808,000

5,799,000

Billed ARPU (1)

$

50.60

$

51.13

$

50.94

$

50.83

$

50.99

Service revenue ARPU (1)

$

57.45

$

57.63

$

58.00

$

59.57

$

59.05

Smartphones sold as a percent of total devices sold

66.0%

61.7%

62.9%

53.0%

51.9%

Total population

Consolidated markets (5)

84,025,000

93,943,000

93,244,000

92,996,000

92,684,000

Consolidated operating markets (5)

31,822,000

47,440,000

46,966,000

46,966,000

46,966,000

Market penetration at end of period

Consolidated markets (6)

5.9%

6.1%

6.2%

6.2%

6.3%

Consolidated operating markets (6)

15.6%

12.1%

12.3%

12.4%

12.3%

Capital expenditures (000s)

$

168,500

$

118,400

$

253,100

$

199,100

$

183,200

Total cell sites in service

7,748

8,027

8,028

7,984

7,932

Owned towers in service

4,411

4,411

4,408

4,377

4,346

 

United States Cellular Corporation

Core Markets Summary Operating Data (Unaudited)

Excludes NY1 & NY2

Quarter Ended

6/30/2013

3/31/2013

12/31/2012

9/30/2012

6/30/2012

Retail Customers

Postpaid

Total at end of period

4,412,000

4,463,000

4,496,000

4,515,000

4,538,000

Gross additions

165,000

176,000

208,000

196,000

167,000

Net additions (losses)

(53,000)

(33,000)

(19,000)

(23,000)

(30,000)

ARPU (1)

$

54.44

$

54.21

$

53.91

$

53.67

$

53.73

Churn rate (2)

1.6%

1.6%

1.7%

1.6%

1.4%

Smartphone penetration (3) (4)

45.5%

43.0%

41.1%

37.8%

36.0%

Prepaid

Total at end of period

381,000

373,000

342,000

305,000

246,000

Gross additions

76,000

91,000

87,000

99,000

60,000

Net additions (losses)

8,000

31,000

37,000

59,000

23,000

ARPU (1)

$

31.65

$

32.92

$

33.21

$

32.97

$

33.23

Churn rate (2)

6.0%

5.6%

5.1%

4.8%

5.4%

Total customers at end of period

4,968,000

5,005,000

5,022,000

5,012,000

4,989,000

Billed ARPU (1)

$

50.98

$

50.93

$

50.71

$

50.59

$

50.71

Service revenue ARPU (1)

$

57.88

$

57.14

$

57.67

$

59.34

$

58.89

Smartphones sold as a percent of total

devices sold

66.1%

62.1%

62.9%

53.0%

52.0%

Total population

Consolidated markets (5)

84,025,000

84,025,000

83,384,000

82,595,000

82,283,000

Consolidated operating markets (5)

31,822,000

31,822,000

31,445,000

31,110,000

31,110,000

Market penetration at end of period

Consolidated markets (6)

5.9%

6.0%

6.0%

6.1%

6.1%

Consolidated operating markets (6)

15.6%

15.7%

16.0%

16.1%

16.0%

Capital expenditures (000s)

$

171,200

$

113,300

$

241,400

$

184,100

$

163,600

Total cell sites in service

6,113

6,113

6,130

6,089

6,041

Owned towers in service

3,844

3,846

3,847

3,818

3,787

 

(1)

ARPU metrics are calculated by dividing a revenue base by an average number of customers by the number of months in the period.  These revenue bases and customer populations are shown below:

a.

Postpaid ARPU consists of total postpaid service revenues and postpaid customers.

b.

Prepaid ARPU consists of total prepaid service revenues and prepaid customers.

c.

Billed ARPU consists of total retail service revenues and postpaid, prepaid and reseller customers.

d.

Service revenue ARPU consists of total retail service revenues, inbound roaming and other service revenues and postpaid, prepaid and reseller customers.

(2)

Churn metrics represent the percentage of the postpaid or prepaid customers that disconnect service each month. These metrics represent the average monthly postpaid or prepaid churn rate for each respective period.

(3)

Smartphones represent wireless devices which run on an Android, BlackBerry® or Windows Mobile® operating system, excluding tablets.

(4)

Smartphone penetration is calculated by dividing postpaid smartphone customers by total postpaid customers.

(5)

Used only to calculate market penetration of consolidated and core markets and consolidated and core operating markets, respectively. See footnote (6) below.

(6)

Market penetration is calculated by dividing the number of wireless customers at the end of the period by the total population of consolidated and core markets and consolidated and core operating markets, respectively, as estimated by Claritas®.

    

United States Cellular Corporation

Consolidated Statement of Operations Highlights

Three Months Ended June 30,

(Unaudited, dollars and shares in thousands, except per share amounts)

      Increase (Decrease)

2013

2012

Amount

Percent

Operating revenues

Service

$

910,966

$

1,029,742

$

(118,776)

(12%)

Equipment sales

84,164

74,658

9,506

13%

Total operating revenues

995,130

1,104,400

(109,270)

(10%)

Operating expenses

System operations (excluding Depreciation, amortization and accretion reported below)

192,267

243,227

(50,960)

(21%)

Cost of equipment sold

217,070

191,700

25,370

13%

Selling, general and administrative

404,127

435,053

(30,926)

(7%)

Depreciation, amortization and accretion

202,580

147,555

55,025

37%

Loss on asset disposals, net

9,018

2,702

6,316

>100%

(Gain) loss on sale of business and other exit costs, net

(249,024)

(249,024)

N/M

Total operating expenses

776,038

1,020,237

(244,199)

(24%)

Operating income

219,092

84,163

134,929

>100%

Investment and other income (expense)

Equity in earnings of unconsolidated entities

35,602

25,154

10,448

42%

Interest and dividend income

969

845

124

15%

Gain (loss) on investments

18,527

(3,728)

22,255

>(100%)

Interest expense

(10,154)

(12,360)

2,206

18%

Other, net

321

(229)

550

>(100%)

Total investment and other income (expense)

45,265

9,682

35,583

>100%

Income before income taxes

264,357

93,845

170,512

>100%

Income tax expense

120,682

34,597

86,085

>100%

Net income

143,675

59,248

84,427

>100%

Less: Net income attributable to noncontrolling interests, net of tax

(284)

(6,563)

6,279

96%

Net income attributable to U.S. Cellular shareholders

$

143,391

$

52,685

$

90,706

>100%

Basic weighted average shares outstanding

83,845

84,707

(862)

(1%)

Basic earnings per share attributable to U.S. Cellular shareholders

$

1.71

$

0.62

$

1.09

>100%

Diluted weighted average shares outstanding

84,661

85,236

(575)

(1%)

Diluted earnings per share attributable to U.S. Cellular shareholders

$

1.69

$

0.62

$

1.07

>100%

 

United States Cellular Corporation

Consolidated Statement of Operations Highlights

Six Months Ended June 30,

(Unaudited, dollars and shares in thousands, except per share amounts)

      Increase (Decrease)

2013

2012

Amount

Percent

Operating revenues

Service

$

1,907,315

$

2,053,562

$

(146,247)

(7%)

Equipment sales

169,561

142,959

26,602

19%

Total operating revenues

2,076,876

2,196,521

(119,645)

(5%)

Operating expenses

System operations (excluding Depreciation, amortization and accretion reported below)

408,566

476,391

(67,825)

(14%)

Cost of equipment sold

458,761

378,736

80,025

21%

Selling, general and administrative

824,207

877,297

(53,090)

(6%)

Depreciation, amortization and accretion

392,425

294,240

98,185

33%

Loss on asset disposals, net

14,452

4,705

9,747

>100%

(Gain) loss on sale of business and other exit costs, net

(242,093)

(4,213)

(237,880)

>100%

Total operating expenses

1,856,318

2,027,156

(170,838)

(8%)

Operating income

220,558

169,365

51,193

30%

Investment and other income (expense)

Equity in earnings of unconsolidated entities

62,437

46,768

15,669

34%

Interest and dividend income

1,872

1,888

(16)

(1%)

Gain (loss) on investments

18,527

(3,728)

22,255

>(100%)

Interest expense

(21,064)

(25,771)

4,707

18%

Other, net

106

(27)

133

>(100%)

Total investment and other income

61,878

19,130

42,748

>100%

Income before income taxes

282,436

188,495

93,941

50%

Income tax expense

128,051

60,235

67,816

>100%

Net income

154,385

128,260

26,125

20%

Less: Net income attributable to noncontrolling interests, net of tax

(6,080)

(13,083)

7,003

54%

Net income attributable to U.S. Cellular shareholders

$

148,305

$

115,177

$

33,128

29%

Basic weighted average shares outstanding

83,842

84,638

(796)

(1%)

Basic earnings per share attributable to U.S. Cellular shareholders

$

1.77

$

1.36

$

0.41

30%

Diluted weighted average shares outstanding

84,655

85,248

(593)

(1%)

Diluted earnings per share attributable to U.S. Cellular shareholders

$

1.75

$

1.35

$

0.40

30%

 

United States Cellular Corporation

Consolidated Balance Sheet Highlights

(Unaudited, dollars in thousands)

ASSETS

June 30,

December 31,

2013

2012

Current assets

Cash and cash equivalents

$

467,421

$

378,358

Short-term investments

110,352

100,676

Accounts receivable from customers and others

368,826

445,220

Inventory

163,433

155,886

Income taxes receivable

1,612

Prepaid expenses

68,063

62,560

Net deferred income tax asset

48,818

35,419

Other current assets

18,845

16,745

1,245,758

1,196,476

Assets held for sale

78,389

216,763

Investments

Licenses

1,396,179

1,456,794

Goodwill

387,360

421,743

Customer lists, net

33

102

Investments in unconsolidated entities

276,363

144,531

Long-term investments

40,120

50,305

2,100,055

2,073,475

Property, plant and equipment

In service and under construction

7,380,123

7,478,428

Less: Accumulated depreciation

4,556,614

4,455,840

2,823,509

3,022,588

Other assets and deferred charges

82,067

78,148

Total assets

$

6,329,778

$

6,587,450

 

United States Cellular Corporation

Consolidated Balance Sheet Highlights

(Unaudited, dollars in thousands)

LIABILITIES AND EQUITY

June 30,

December 31,

2013

2012

Current liabilities

Current portion of long-term debt

$

100

$

92

Accounts payable

Affiliated

15,459

10,725

Trade

341,581

310,936

Customer deposits and deferred revenues

198,799

192,113

Accrued taxes

183,312

35,834

Accrued compensation

62,140

90,418

Other current liabilities

100,500

114,881

901,891

754,999

Liabilities held for sale

559

19,594

Deferred liabilities and credits

Net deferred income tax liability

835,808

849,818

Other deferred liabilities and credits

306,262

288,441

Long-term debt

879,121

878,858

Noncontrolling interests with redemption features

512

493

Equity

U.S. Cellular shareholders' equity

Series A Common and Common Shares, par value $1 per share

88,074

88,074

Additional paid-in capital

1,418,428

1,412,453

Treasury shares

(177,173)

(165,724)

Retained earnings

2,055,905

2,399,052

Total U.S. Cellular shareholders' equity

3,385,234

3,733,855

Noncontrolling interests

20,391

61,392

Total equity

3,405,625

3,795,247

Total liabilities and equity

$

6,329,778

$

6,587,450

 

United States Cellular Corporation

Schedule of Cash and Cash Equivalents and Investments

(Unaudited, dollars in thousands)

 

The following table presents U.S. Cellular's cash and cash equivalents and investments at June 30, 2013 and December 31, 2012.

June 30,

December 31,

2013

2012

Cash and cash equivalents

$

467,421

$

378,358

Amounts included in short-term investments (1)(2)

U.S. Treasury Notes

110,352

100,676

Amounts included in long-term investments (1)(3)

U.S. Treasury Notes

40,120

50,305

Total cash and cash equivalents and investments

$

617,893

$

529,339

 

(1)

Designated as held-to-maturity investments and are recorded at amortized cost on the Consolidated Balance Sheet.

(2)

Maturities are less than twelve months from the respective balance sheet dates.

(3)

At June 30, 2013, maturities range between 17 and 18 months.

    

United States Cellular Corporation

Consolidated Statement of Cash Flows

Six Months Ended June 30,

(Unaudited, dollars in thousands)

2013

2012

Cash flows from operating activities

Net income

$

154,385

$

128,260

Add (deduct) adjustments to reconcile net income to net cash flows from operating activities

Depreciation, amortization and accretion

392,425

294,240

Bad debts expense

32,715

30,659

Stock-based compensation expense

6,530

11,057

Deferred income taxes, net

(26,527)

30,479

Equity in earnings of unconsolidated entities

(62,437)

(46,768)

Distributions from unconsolidated entities

45,370

6,743

Loss on asset disposals, net

14,452

4,705

(Gain) loss on sale of business and other exit costs, net

(242,093)

(4,213)

(Gain) loss on investments

(18,527)

3,728

Noncash interest expense

526

902

Other operating activities

489

321

Changes in assets and liabilities from operations

Accounts receivable

(1,544)

(13,383)

Inventory

(7,644)

(56,039)

Accounts payable - trade

67,457

(20,987)

Accounts payable - affiliate

4,734

3,129

Customer deposits and deferred revenues

8,663

21,131

Accrued taxes

147,566

85,327

Accrued interest

176

149

Other assets and liabilities

(68,131)

(67,203)

448,585

412,237

Cash flows from investing activities

Cash used for additions to property, plant and equipment

(323,157)

(430,225)

Cash paid for acquisitions and licenses

(14,150)

(12,647)

Cash received from divestitures

480,000

49,786

Cash paid for investments

(45,000)

Cash received for investments

45,000

Other investing activities

3,993

(3,097)

146,686

(396,183)

Cash flows from financing activities

Repayment of long-term debt

(71)

(45)

Common shares reissued for benefit plans, net of tax payments

(2,206)

(2,465)

Common shares repurchased

(18,425)

Dividends paid

(482,270)

Distributions to noncontrolling interests

(3,292)

(643)

Other financing activities

56

568

(506,208)

(2,585)

Net increase in cash and cash equivalents

89,063

13,469

Cash and cash equivalents

Beginning of period

378,358

424,155

End of period

$

467,421

$

437,624

 

United States Cellular Corporation

Financial Measures and Reconciliations

(Unaudited, dollars in thousands)

Three Months Ended

Six Months Ended

June 30,

June 30,

2013

2012

2013

2012

Cash flows from operating activities

$

224,970

$

155,270

$

448,585

$

412,237

Deduct:

Cash used for additions to property, plant

and equipment

172,133

221,065

323,157

430,225

Free cash flow (1)

$

52,837

$

(65,795)

$

125,428

$

(17,988)

 

(1)

Free cash flow is defined as Cash flows from operating activities less Cash used for additions to property, plant and equipment. Free cash flow is a non-GAAP financial measure. U.S. Cellular believes that free cash flow as reported by U.S. Cellular may be useful to investors and other users of its financial information in evaluating the amount of cash generated by business operations, after consideration of capital expenditures.

 

SOURCE United States Cellular Corporation



RELATED LINKS

http://www.uscellular.com