2014

U.S. Cellular Reports Third Quarter 2013 Results

CHICAGO, Nov. 1, 2013 /PRNewswire/ -- As previously announced, U.S. Cellular will hold a teleconference Nov. 1, 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 $862.3 million for the third quarter of 2013, versus $1,036.4 million for the comparable period one year ago. Net income (loss) attributable to U.S. Cellular shareholders and related diluted earnings (loss) per share were $(9.9) million and $(0.12) respectively, for the third quarter of 2013, compared to $35.5 million and $0.42, respectively, in the comparable period one year ago.

"We have continued to execute on our strategies to improve U.S. Cellular's competitive position and financial foundation," said Kenneth R. Meyers, U.S. Cellular president and CEO. "We're close to bringing 4G LTE to nearly 90 percent of our customers, we have a new billing system in place, and we plan to expand our device portfolio with the launch of the Apple iPhone and iPad on November 8, supported by our recently introduced shared data plans for consumers and businesses. Regrettably, the billing system implementation impacted our ability to provide high-quality service to every customer for a period of time.  However, we have made substantial progress in resolving the issues, and we expect the system to provide significant benefits over the long term.

"I believe we're positioned well to achieve improved customer growth in the future, with a fast 4G LTE network, a competitive selection of devices and plans, and effective distribution through our company- and agent-owned stores, uscellular.com, and our national retail partners.

"We have been successful in our sales of non-strategic spectrum, with deals signed or closed generating pre-tax cash proceeds of over $400 million."

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 September 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


$3,475 - $3,575

$3,450 - $3,500


$140

Unchanged


$3,615-$3,715

$3,590-$3,640

Adjusted income before

  income taxes (4)


$560 - $660

Unchanged


$40

Unchanged


$600-$700

Unchanged

Capital expenditures


$730

Unchanged


$5

Unchanged


$735

Unchanged

 

(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 actual or expected gains from 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 the items set forth in the reconciliation below.  Adjusted income before income taxes excludes these items in order to show operating results on a more comparable basis from period to period.  In addition, U.S. Cellular may also exclude other items from adjusted income before income taxes if such items 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.  U.S. Cellular believes Adjusted income before income taxes is a useful measure of U.S. Cellular's operating results before significant recurring non-cash charges, discrete gains and losses and financing charges (Interest expense).  The following tables provide a reconciliation of Income (loss) before income taxes to Adjusted income before income taxes for 2013 Estimated Results, nine months ended September 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

$315-$415

$35

$350-$450

Depreciation, amortization and accretion expense (5)

$540

$250

$790

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

($245)

($245)

(Gain) loss from spectrum license divestitures

($325)

($325)

(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





Nine Months Ended

September 30, 2013

Year Ended

December 31, 2012













Income before income taxes

$

266

$

205

Depreciation, amortization and accretion expense (5)


593


609

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


(244)


21

(Gain) loss from spectrum license divestitures





(Gain) loss on investments




(18)


4

Interest expense


33


42

Adjusted income before income taxes

$

630

$

881

 

(5)

The 2013 estimated amount for Depreciation, amortization and accretion expense in the Divestiture Markets includes approximately $171 million of incremental accelerated depreciation, amortization and accretion resulting from the Divestiture Transaction.  Actual results for the nine months ended September 30, 2013 and the year ended December 31, 2012 include $134 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 Nov. 1, 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 4.9 million customers in 23 states. The Chicago-based company had 6,000 full- and part-time associates as of September 30, 2013. At the end of the third quarter of 2013, 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 any pending acquisition and divestiture transactions,  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 TDS and U.S. Cellular 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; 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 U.S. Cellular. 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

9/30/2013


6/30/2013


3/31/2013


12/31/2012


9/30/2012

Retail Customers
















Postpaid

















Total at end of period


4,343,000



4,412,000



5,060,000



5,134,000



5,175,000



Gross additions


165,000



165,000



191,000



241,000



230,000



Net additions (losses)


(60,000)



(120,000)



(74,000)



(41,000)



(38,000)



ARPU (1)

$

54.64


$

54.18


$

54.85


$

54.56


$

54.34



Churn rate (2)


1.7%



2.0%



1.7%



1.8%



1.7%



Smartphone penetration (3) (4)


47.1%



45.5%



43.5%



41.8%



38.6%


Prepaid

















Total at end of period


370,000



381,000



446,000



423,000



386,000



Gross additions


65,000



77,000



104,000



107,000



120,000



Net additions (losses)


(11,000)



(7,000)



23,000



37,000



57,000



ARPU (1)

$

28.72


$

31.69


$

33.31


$

33.56


$

32.97



Churn rate (2)


6.8%



6.8%



6.2%



5.8%



5.9%

Total customers at end of period


4,875,000



4,968,000



5,736,000



5,798,000



5,808,000

Billed ARPU (1)

$

50.92


$

50.60


$

51.13


$

50.94


$

50.83

Service revenue ARPU (1)

$

58.36


$

57.45


$

57.63


$

58.00


$

59.57

Smartphones sold as a percent of total

  devices sold


65.2%



66.0%



61.7%



62.9%



53.0%

Total population

















Consolidated markets (5)


84,025,000



84,025,000



93,943,000



93,244,000



92,996,000



Consolidated operating markets (5)


31,822,000



31,822,000



47,440,000



46,966,000



46,966,000

Market penetration at end of period

















Consolidated markets (6)


5.8%



5.9%



6.1%



6.2%



6.2%



Consolidated operating markets (6)


15.3%



15.6%



12.1%



12.3%



12.4%

Capital expenditures (000s)

$

242,500


$

168,500


$

118,400


$

253,100


$

199,100

Total cell sites in service


7,687



7,748



8,027



8,028



7,984

Owned towers in service


4,422



4,411



4,411



4,408



4,377

 

United States Cellular Corporation

Core Markets Summary Operating Data (Unaudited)

Excludes NY1 & NY2


















Quarter Ended

9/30/2013


6/30/2013


3/31/2013


12/31/2012


9/30/2012

Retail Customers
















Postpaid

















Total at end of period


4,343,000



4,412,000



4,463,000



4,496,000



4,515,000



Gross additions


165,000



165,000



176,000



208,000



196,000



Net additions (losses)


(60,000)



(53,000)



(33,000)



(19,000)



(23,000)



ARPU (1)

$

54.64


$

54.44


$

54.21


$

53.91


$

53.67



Churn rate (2)


1.7%



1.6%



1.6%



1.7%



1.6%



Smartphone penetration (3) (4)


47.1%



45.5%



43.0%



41.1%



37.8%


Prepaid

















Total at end of period


370,000



381,000



373,000



342,000



305,000



Gross additions


65,000



76,000



91,000



87,000



99,000



Net additions (losses)


(11,000)



8,000



31,000



37,000



59,000



ARPU (1)

$

28.72


$

31.65


$

32.92


$

33.21


$

32.97



Churn rate (2)


6.8%



6.0%



5.6%



5.1%



4.8%

Total customers at end of period


4,875,000



4,968,000



5,005,000



5,022,000



5,012,000

Billed ARPU (1)

$

50.92


$

50.98


$

50.93


$

50.71


$

50.59

Service revenue ARPU (1)

$

58.36


$

57.88


$

57.14


$

57.67


$

59.34

Smartphones sold as a percent of total

  devices sold


65.2%



66.1%



62.1%



62.9%



53.0%

Total population

















Consolidated markets (5)


84,025,000



84,025,000



84,025,000



83,384,000



82,595,000



Consolidated operating markets (5)


31,822,000



31,822,000



31,822,000



31,445,000



31,110,000

Market penetration at end of period

















Consolidated markets (6)


5.8%



5.9%



6.0%



6.0%



6.1%



Consolidated operating markets (6)


15.3%



15.6%



15.7%



16.0%



16.1%

Capital expenditures (000s)

$

239,300


$

171,200


$

113,300


$

241,400


$

184,100

Total cell sites in service


6,127



6,113



6,113



6,130



6,089

Owned towers in service


3,859



3,844



3,846



3,847



3,818
















(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 postpaid, prepaid, and reseller 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 AndroidTM, 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 September 30,



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










      Increase (Decrease)




2013


2012


Amount


Percent

Operating revenues












Service

$

862,330


$

1,036,370


$

(174,040)


(17%)


Equipment sales


76,906



103,987



(27,081)


(26%)



Total operating revenues


939,236



1,140,357



(201,121)


(18%)














Operating expenses












System operations (excluding Depreciation, amortization and accretion

  reported below)


177,431



249,245



(71,814)


(29%)


Cost of equipment sold


193,392



248,029



(54,637)


(22%)


Selling, general and administrative


410,468



438,526



(28,058)


(6%)


Depreciation, amortization and accretion


200,985



145,151



55,834


38%


Loss on asset disposals, net


1,701



11,262



(9,561)


(85%)


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


(1,534)



65



(1,599)


>(100%)



Total operating expenses


982,443



1,092,278



(109,835)


(10%)














Operating income (loss)


(43,207)



48,079



(91,286)


>(100%)














Investment and other income (expense)












Equity in earnings of unconsolidated entities


37,360



24,816



12,544


51%


Interest and dividend income


1,095



935



160


17%


Interest expense


(11,329)



(9,501)



(1,828)


(19%)


Other, net


47



200



(153)


(77%)



Total investment and other income (expense)


27,173



16,450



10,723


65%














Income (loss) before income taxes


(16,034)



64,529



(80,563)


>(100%)


Income tax expense (benefit)


(6,433)



22,389



(28,822)


>(100%)














Net income (loss)


(9,601)



42,140



(51,741)


>(100%)


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


258



6,689



(6,431)


(96%)

Net income (loss) attributable to U.S. Cellular shareholders

$

(9,859)


$

35,451


$

(45,310)


>(100%)













Basic weighted average shares outstanding


84,005



84,737



(732)


(1%)

Basic earnings (loss) per share attributable to U.S. Cellular shareholders

$

(0.12)


$

0.42


$

(0.54)


>(100%)














Diluted weighted average shares outstanding


84,005



85,348



(1,343)


(2%)

Diluted earnings (loss) per share attributable to U.S. Cellular shareholders

$

(0.12)


$

0.42


$

(0.54)


>(100%)

 


United States Cellular Corporation

Consolidated Statement of Operations Highlights

Nine Months Ended September 30,

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










      Increase (Decrease)




2013


2012


Amount


Percent

Operating revenues












Service

$

2,769,645


$

3,089,932


$

(320,287)


(10%)


Equipment sales


246,467



246,946



(479)




Total operating revenues


3,016,112



3,336,878



(320,766)


(10%)














Operating expenses












System operations (excluding Depreciation, amortization and accretion

  reported below)


585,997



725,636



(139,639)


(19%)


Cost of equipment sold


652,153



626,765



25,388


4%


Selling, general and administrative


1,234,675



1,315,823



(81,148)


(6%)


Depreciation, amortization and accretion


593,410



439,391



154,019


35%


Loss on asset disposals, net


16,153



15,967



186


1%


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


(243,627)



(4,148)



(239,479)


>100%



Total operating expenses


2,838,761



3,119,434



(280,673)


(9%)














Operating income


177,351



217,444



(40,093)


(18%)














Investment and other income (expense)












Equity in earnings of unconsolidated entities


99,797



71,584



28,213


39%


Interest and dividend income


2,967



2,823



144


5%


Gain (loss) on investments


18,527



(3,728)



22,255


>(100%)


Interest expense


(32,393)



(35,272)



2,879


8%


Other, net


153



173



(20)


(12%)



Total investment and other income


89,051



35,580



53,471


>100%














Income before income taxes


266,402



253,024



13,378


5%


Income tax expense


121,618



82,624



38,994


47%














Net income


144,784



170,400



(25,616)


(15%)


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


6,338



19,772



(13,434)


(68%)

Net income attributable to U.S. Cellular shareholders

$

138,446


$

150,628


$

(12,182)


(8%)













Basic weighted average shares outstanding


83,897



84,671



(774)


(1%)

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

$

1.65


$

1.78


$

(0.13)


(7%)














Diluted weighted average shares outstanding


84,676



85,261



(585)


(1%)

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

$

1.64


$

1.77


$

(0.13)


(7%)

 


United States Cellular Corporation

Consolidated Balance Sheet Highlights

(Unaudited, dollars in thousands)








ASSETS

















September 30, 


December 31, 



2013


2012

Current assets







Cash and cash equivalents

$

183,101


$

378,358


Short-term investments


45,162



100,676


Accounts receivable from customers and others


560,915



445,220


Inventory


142,560



155,886


Income taxes receivable




1,612


Prepaid expenses


71,047



62,560


Net deferred income tax asset


54,475



35,419


Other current assets


19,051



16,745




1,076,311



1,196,476








Assets held for sale


78,413



216,763








Investments







Licenses


1,397,888



1,456,794


Goodwill


387,360



421,743


Customer lists, net




102


Investments in unconsolidated entities


309,481



144,531


Long-term investments


40,099



50,305




2,134,828



2,073,475








Property, plant and equipment







In service and under construction


7,571,429



7,478,428


Less: Accumulated depreciation


4,696,836



4,455,840




2,874,593



3,022,588








Other assets and deferred charges


95,709



78,148








Total assets

$

6,259,854


$

6,587,450

 


United States Cellular Corporation

Consolidated Balance Sheet Highlights

(Unaudited, dollars in thousands)









LIABILITIES AND EQUITY




















September 30, 


December 31, 




2013


2012

Current liabilities







Current portion of long-term debt

$

102


$

92


Accounts payable








Affiliated


11,069



10,725



Trade


334,047



310,936


Customer deposits and deferred revenues


212,733



192,113


Accrued taxes


102,510



35,834


Accrued compensation


58,282



90,418


Other current liabilities


133,637



114,881





852,380



754,999









Liabilities held for sale


471



19,594









Deferred liabilities and credits







Net deferred income tax liability


829,247



849,818


Other deferred liabilities and credits


294,675



288,441









Long-term debt


878,939



878,858









Noncontrolling interests with redemption features


540



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


1,421,261



1,412,453


Treasury shares


(168,454)



(165,724)


Retained earnings


2,042,254



2,399,052



Total U.S. Cellular shareholders' equity


3,383,135



3,733,855









Noncontrolling interests


20,467



61,392










Total equity


3,403,602



3,795,247









Total liabilities and equity

$

6,259,854


$

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 September 30, 2013 and December 31, 2012.




September 30,


December 31,


2013


2012








Cash and cash equivalents

$

183,101


$

378,358








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







U.S. Treasury Notes


45,162



100,676








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







U.S. Treasury Notes


40,099



50,305








Total cash and cash equivalents and investments

$

268,362


$

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 September 30, 2013, maturities range between 14 and 15 months.

 


United States Cellular Corporation

Consolidated Statement of Cash Flows

Nine Months Ended September 30,

(Unaudited, dollars in thousands)







2013


2012

Cash flows from operating activities







Net income

$

144,784


$

170,400


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

  operating activities









Depreciation, amortization and accretion


593,410



439,391




Bad debts expense


52,184



51,293




Stock-based compensation expense


11,143



15,924




Deferred income taxes, net


(38,515)



52,865




Equity in earnings of unconsolidated entities


(99,797)



(71,584)




Distributions from unconsolidated entities


49,612



45,211




Loss on asset disposals, net


16,153



15,967




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


(243,627)



(4,148)




(Gain) loss on investments


(18,527)



3,728




Noncash interest expense


792



1,331




Other operating activities


590



863


Changes in assets and liabilities from operations









Accounts receivable


(214,114)



(67,302)




Inventory


13,236



(69,423)




Accounts payable - trade


32,202



(28,902)




Accounts payable - affiliate


345



(4,785)




Customer deposits and deferred revenues


22,538



26,687




Accrued taxes


45,780



99,556




Accrued interest


9,385



9,508




Other assets and liabilities


(81,341)



(77,821)






296,233



608,759










Cash flows from investing activities







Cash used for additions to property, plant and equipment


(522,180)



(611,431)


Cash paid for licenses


(16,540)



(57,957)


Cash received from divestitures


484,300



49,932


Cash paid for investments




(45,000)


Cash received for investments


65,000



50,000


Other investing activities


583



(5,030)






11,163



(619,486)










Cash flows from financing activities







Repayment of long-term debt


(393)



(343)


Common shares reissued for benefit plans, net of tax payments


2,840



(2,299)


Common shares repurchased


(18,544)




Dividends paid


(482,270)




Distributions to noncontrolling interests


(3,447)



(1,491)


Other financing activities


(839)



284






(502,653)



(3,849)










Net decrease in cash and cash equivalents


(195,257)



(14,576)










Cash and cash equivalents







Beginning of period


378,358



424,155


End of period

$

183,101


$

409,579

 

United States Cellular Corporation

Financial Measures and Reconciliations

(Unaudited, dollars in thousands)




















Three Months Ended


Nine Months Ended





September 30,


September 30,




2013



2012



2013



2012

















Cash flows from operating activities


$

(152,352)


$

196,522


$

296,233


$

608,759


Deduct:














Cash used for additions to property, plant

  and equipment



199,023



181,206



522,180



611,431



Free cash flow (1)


$

(351,375)


$

15,316


$

(225,947)


$

(2,672)




(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



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http://www.uscellular.com

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