CTE Achieves EBITDA of $41 Million for the 2002 Third Quarter, Reflecting 13% Growth, Versus 2001 Third Quarter EBITDA of $36 Million.Business Editors DALLAS Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. , Pa.--(BUSINESS WIRE)--Nov. 6, 2002 Commonwealth Telephone Enterprises, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : CTCO CTCO Chicago Transportation Coordination Office , CTCOB) CTE (Coefficient of Thermal Expansion) The difference between the way two materials expand when heat is applied. This is very critical when chips are mounted to printed circuit boards, because the silicon chip expands at a different rate than the plastic board. Reports 2002 Third Quarter Diluted Earnings Per Share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of ("EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ") of $0.58, and Recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. EPS of $0.54 Excluding a Non-Recurring $0.04 Tax Benefit Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. J. Mahoney Mahoney could refer to:
EST abbr. electroshock therapy ) this morning. Mr. Mahoney will discuss CTE's 2002 third quarter results and review 2002 full year guidance. The call is expected to last approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 30 minutes. To access today's conference call, please call 1-800-482-2225. The conference call passcode is 2424814. The simultaneous webcast can be accessed via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.ct-enterprises.com. The conference call will be archived and available for replay for 48 hours following the call. To access the replay, please call 1-888-211-2648, passcode 2424814. The webcast will also be available for replay for 48 hours at www.ct-enterprises.com. Commonwealth Telephone Enterprises, Inc. ("CTE") (NASDAQ: CTCO, CTCOB) today announced financial results for the 2002 third quarter. CTE reported 2002 third quarter diluted earnings per share ("EPS") of $0.58, versus a reported diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. EPS of $0.76 in the 2001 third quarter. CTE's 2002 third quarter recurring diluted EPS was $0.54, which reflects the exclusion exclusion /ex·clu·sion/ (eks-kloo´zhun) 1. a shutting out or elimination. 2. surgical isolation of a part, as of a segment of intestine, without removal from the body. of a $0.9 million non-recurring tax benefit, or $0.04 per share. This anticipated favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. tax impact resulted from a recent Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York tax law change that increased the amount of net operating losses Net operating losses Losses that a firm can take advantage of to reduce taxes. that are allowed to be carried forward for state tax purposes. CTE's third quarter recurring EPS of $0.54 compares to recurring EPS of $0.40 in the 2001 third quarter, which was adjusted by $0.36 due to $0.23 of non-recurring tax benefits, and $0.13 resulting from an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. positive settlement in connection with certain restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. recorded in the 2000 fourth quarter. The non-recurring tax benefits referred to above for both years, as well as the positive settlement recorded in last year's third quarter in connection with CTE's 2000 fourth quarter restructuring charge, were recorded below CTE's EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
An income statement that combines the income statements of two or more organizations. As with other consolidated statements, a consolidated income statement eliminates any funds owed to or due from firms within the same group. . "Overall, we had an outstanding third quarter," said Michael J. Mahoney, CTE's president and chief executive officer. "Our consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: results were solid across the board. On a consolidated basis we achieved revenue growth of 5%, EBITDA growth of 13% and a 51% EBITDA margin. The combined operations For the department of the British War Office during World War II, see . In the military, combined operations are operations conducted by forces of two or more allied nations acting together for the accomplishment of a single mission. See also
CTSI California Traffic Safety Institute CTSI Corbett Technology Solutions, Inc. (Chantilly, VA) CTSI Central Terminal Signaling Interface added over 5,000 new access lines in the third quarter, and now serve 460,243 access lines - a growth rate of 6% versus last year's third quarter. "The most impressive aspect of our third quarter is that we have continued to deliver consistent and steady financial performance," continued Mahoney. We have remained steadfast in our commitment to grow our EBITDA and strengthen our balance sheet by aggressively utilizing our cash flow to reduce debt. Given our solid EPS performance in the quarter, I am raising our EPS guidance for the 2002 full year to a range of $2.19 to $2.21. I remain confident in our ability to achieve our operating and financial objectives for the 2002 full year." CTE Consolidated Results CTE's consolidated revenues in the 2002 third quarter were $80.3 million, a growth rate of 5% versus the 2001 third quarter. Consolidated EBITDA was $40.8 million versus $36.2 million in last year's third quarter, an increase of 13%. CTE achieved a consolidated EBITDA margin of 51% in the third quarter versus an EBITDA margin of 48% in the year ago quarter, an increase of over 300 basis points. Consolidated capital expenditures were $12.3 million, versus $17.2 million in the 2001 third quarter. The table below sets forth highlights of CTE's 2002 third quarter consolidated results versus the 2001 third quarter:
2002 2001 % Change
Third Third Inc./
Quarter Quarter (Dec.)
------- ------- ---------
Total Access Lines 460,243 436,049 6%
Revenue $80.3M $76.2M 5%
EBITDA $40.8M $36.2M 13%
EBITDA Margin 50.8% 47.5% 330 bps
CAPEX $12.3M $17.2M (28%)
Total Debt $178.6M $262.6M (32%)
Debt/EBITDA (Last 12 months) 1.1x 2.1x (48%)
Recurring EPS $0.54 $0.40 35%
Commonwealth Telephone Company ("CT") Results CT had a total of 337,109 access lines installed at the end of the 2002 third quarter - a growth rate of 3% versus last year. CT's incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. growth in switched access lines resulted from a combination of steady growth in the number of business lines installed in CT's territory, as well as an increase in the number of residential additional lines installed. CT's business line growth was 6% versus the 2001 third quarter, while residential additional line penetration The successful unauthorized breach of a security perimeter. See penetration test. ended the quarter at 40% - a level that has generally held steady over the past several quarters. CT's 2002 third quarter revenues grew 7% to $50.7 million, versus revenues of $47.4 million in the 2001 third quarter. CT's 7% revenue growth was primarily driven by increased access revenues resulting from changes in the NECA NECA National Electrical Contractors Association NECA National Exchange Carrier Association NECA National Electrical and Communications Association (Australia) NECA National Electricity Code Administrator (Australia) (National Exchange Carrier Association) average schedule settlement formula, increased demand for special circuits, 15% growth in enhanced services Enhanced service is service offered over commercial carrier transmission facilities used in interstate communications, that employs computer processing applications that act on the format, content, code, protocol, or similar aspects of the subscriber's transmitted information; , and access line growth. CT's 2002 third quarter EBITDA was $33.0 million, a 7% increase over last year, resulting in a 65% EBITDA margin, thereby maintaining the 65% EBITDA margin achieved in last year's third quarter. CT's 2002 third quarter CAPEX was $6.1 million versus $9.9 million in the 2001 third quarter. CTSI "Edge-Out" Market Results During the 2002 third quarter, CTSI installed 3,663 net access lines, ending the quarter with 123,134 cumulative net access lines installed, a growth rate of 13% versus the 2001 third quarter. At the end of the 2002 third quarter, 98% of CTSI's access lines were "on-switch," and 52% were "on-net Connected to the Internet, or connected to a LAN or WAN. Contrast with off-net. " (defined as 100% on CTSI's owned network). CTSI's business/residential line split at the end of the 2002 third quarter was 88%/12%. CTSI's 2002 third quarter revenues were $20.9 million, a growth rate of 11% versus revenues of $18.9 million in the 2001 third quarter. CTSI's third quarter revenues reflect a modification A change or alteration in existing materials. Modification generally has the same meaning in the law as it does in common parlance. The term has special significance in the law of contracts and the law of sales. to transport billings Billings, city (1990 pop. 81,151), seat of Yellowstone co., S Mont., on the Yellowstone River, in a valley surrounded by seven mountain ranges; inc. as a city 1885. related to access trunking See port aggregation. , which resulted in a reduction of approximately $0.8 million in access revenues. The reduced transport billings are anticipated to have an unfavorable revenue impact of approximately $1.2 million in the 2002 fourth quarter, as well as future quarters. "The underlying fundamentals of our CTSI operation remain solid," said Mahoney. "In particular, our 13% line growth is indicative indicative: see mood. of our continued ability to further penetrate our markets and add to our base of customers. The modification to our access trunking revenues will impact both our revenue and EBITDA results in this quarter and going forward. Notwithstanding this reduction to our anticipated access revenues, we expect to achieve results within the ranges of our previously communicated 2002 full year guidance at CTSI across the board, including our access line growth, revenue growth, EBITDA and EBITDA margin objectives." CTSI's EBITDA in the 2002 third quarter was $6.9 million, versus EBITDA of $5.7 million in the 2001 third quarter, reflecting an EBITDA margin of 33%. CTSI's EBITDA growth and margin expansion in the 2002 third quarter were primarily driven by year-over-year access line growth and growth in access minutes of use, offset by the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. reduction in access trunking revenues. Additionally, ongoing cost control initiatives, including reduced expenses resulting from a nearly 300 basis point increase in the percentage of "on-net" access lines versus the year ago quarter, have positively impacted CTSI's EBITDA and EBITDA margin performance. CTSI's 2002 third quarter capital expenditures were $5.5 million, versus $5.0 million in the year ago quarter. The $5.5 million of CAPEX in the 2002 third quarter was substantially all success-based in support of line growth. Jack Flash(R) DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary In the 2002 third quarter, CTE's DSL (digital subscriber line See DSL. (communications, protocol) Digital Subscriber Line - (DSL, or Digital Subscriber Loop, xDSL - see below) A family of digital telecommunications protocols designed to allow high speed data communication over the existing copper telephone lines between end-users and ) product, Jack Flash(R), installed 614 net new DSL subscribers. Jack Flash(R) had 9,125 installed DSL subscribers at the end of the 2002 third quarter. Jack Flash(R) is marketed in CTE's CT and CTSI "edge-out" geographies. Jack Flash(R) utilizes DSL technology to provide broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). connectivity A generic term for connecting devices to each other in order to transfer data back and forth. It often refers to network connections, which embraces bridges, routers, switches and gateways as well as backbone networks. over standard telephone lines at speeds over 50 times faster than today's traditional dial-up Refers to using the regular "dial-up" telephone network to send data from a computer to a remote network or to a remote device. The computer's digital data are converted to analog signals in the same frequency range as human voice by a modem. modems. 2002 Full Year Guidance The table below sets forth CTE's previously communicated 2002 full year guidance, as well as revised 2002 full year EPS guidance, which Mr. Mahoney will discuss on this morning's conference call and webcast:
Previously Revised
Communicated 2002 Full
2002 Full Year Year
Item Guidance Guidance
---------------------- ----------------- ----------------
CT Access Line Growth 3% - 4% Unchanged
Revenue Growth Rate 4% - 5% Unchanged
EBITDA $125M - $128M Unchanged
EBITDA Margin 63% - 65% Unchanged
CAPEX $30M - $35M Unchanged
CTSI Net Access Lines
("Edge-Out" Installed - FY02 13,500 - 14,500 Unchanged
Markets Net Access Lines
Only) Installed - Per
Quarter 2,500 - 3,500 Unchanged
Revenue Growth Rate 13% - 16% Unchanged
EBITDA $26M - $29M Unchanged
EBITDA Margin 30% - 35% Unchanged
CAPEX $20M - $25M Unchanged
DSL DSL Subscribers 9,000 - 9,500 Unchanged
EBITDA Breakeven Unchanged
Consolidated
CTE Reported Revenue
Growth 3% - 4% Unchanged
Revenue Growth (a) 4.5% - 5.5% Unchanged
Reported EBITDA $150M - $157M Unchanged
Effective Tax Rate Approx. 40% Unchanged
Reported Diluted EPS -
4Q02 $0.54 - $0.56 Unchanged
Diluted EPS - FY02 $2.14 - $2.18(b) $2.19 - $2.21(b)
CAPEX $60M - $65M Unchanged
Year-End Total Debt $160M - $170M Unchanged
(a) Excludes the impact of CTSI's expansion markets.
(b) Excludes 1Q02 $0.06 charge in connection with Voluntary Retirement
Program, 2Q02 $0.05 positive settlement related to 4Q00
restructuring charge, 2Q02 $0.05 charge in connection with
WorldCom receivables, and 3Q02 $0.04 favorable non-recurring tax
benefit.
About CTE Headquartered in Dallas, PA, Commonwealth Telephone Enterprises, Inc., serves a growing base of business and residential customers with the full array of technologically advanced data and voice telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. products and services, including broadband data services and high-speed Internet See broadband. access, delivered over its 100% digitally switched, fiber-rich network. CTE's primary operating segments are: Commonwealth Telephone Company ("CT"), the nation's eighth largest publicly held independent rural local exchange carrier ("RLEC RLEC Rural Local Exchange Carrier RLEC Report Log Exception Condition "), which has been operating in various rural Pennsylvania markets since 1897; and, CTSI, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control ("CTSI"), an RLEC "edge-out" local exchange carrier operating outside CT's territory, that formally commenced operations in 1997. CTE's support businesses include epix(R) Internet Services (www.epix.net), one of the northeast's largest rural Internet Service Providers Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. ("ISPs"); and, Jack Flash(R), a broadband data service that uses DSL technology to offer high-speed Internet access and digital connectivity solutions. Additionally, CTE operates two other support businesses that provide expertise to its CT and CTSI operations. These businesses are Commonwealth Communications, a provider of telecommunications equipment and facilities management The management of a user's computer installation by an outside organization. All operations including systems, programming and the datacenter can be performed by the facilities management organization on the user's premises. services; and, CLD CLD Called CLD Cloud CLD Cleared CLD Chronic Lung Disease CLD Council for Learning Disabilities CLD Cooled CLD Chronic Liver Disease CLD Clear Direction Flag CLD Certified LabVIEW Developer CLD Causal Loop Diagram , a long-distance long-dis·tance adj. 1. Covering a long distance: a long-distance runner; operating under long-distance supervision. 2. reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. . A web site featuring current information regarding Commonwealth Telephone Enterprises, Inc., can be found on the Internet at www.ct-enterprises.com. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. The Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 provides a "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " for forward-looking statements. Certain information included in this press release is forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. . Such forward-looking information involves important risks and uncertainties that could significantly affect expected results in the future and cause them to be different from those expressed in any forward-looking statements made by, or on behalf of, the Company. These risks and uncertainties include, but are not limited to, uncertainties related to the Company's ability to further penetrate its markets and the related costs of that effort, economic conditions, acquisitions and divestitures, government and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. policies, the pricing and availability of equipment, materials and inventories, technological developments and changes in the competitive environment in which the Company operates.
COMMONWEALTH TELEPHONE ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
(Dollars in Thousands)
3RD QUARTER 2002
-----------------------------------------
CT CTSI OTHER TOTAL
-- ---- ----- -----
Sales $ 50,717 $ 20,896 $ 8,691 $ 80,304
Costs & Expenses (excluding
other operating expenses
itemized below) 17,423 13,869 7,931 39,223
Management Fees 300 99 (99) 300
--------- --------- -------- ---------
EBITDA 32,994 6,928 859 40,781
Depreciation & Amortization 11,469 4,736 923 17,128
Restructuring Charges
(Reversals) - - - -
Voluntary Employee
Retirement Program - - - -
Operating Income (Loss) 21,525 2,192 (64) 23,653
Interest and Dividend Income 333 - 54 387
Interest Expense (1,228) - (1,569) (2,797)
Other Income (Expense), net (108) (169) (86) (363)
Income (Loss) before Income
Taxes 20,522 2,023 (1,665) 20,880
Provision (Benefit) for
Income Taxes (1) (2) 7,600 191 (615) 7,176
Income (Loss) before Equity
in Unconsolidated Entities 12,922 1,832 (1,050) 13,704
Equity in Unconsolidated
Entities - 131 - 131
Net Income (Loss) $ 12,922 $ 1,963 $(1,050) $ 13,835
========= ========= ======== =========
3RD QUARTER 2001
-----------------------------------------
CT CTSI OTHER TOTAL
-- ---- ----- -----
Sales $ 47,440 $ 18,889 $ 9,894 $ 76,223
Costs & Expenses (excluding
other operating expenses
itemized below) 16,379 13,053 10,249 39,681
Management Fees 300 99 (99) 300
--------- --------- -------- ---------
EBITDA 30,761 5,737 (256) 36,242
Depreciation & Amortization 10,583 4,384 1,410 16,377
Restructuring Charges
(Reversals) - (5,268) - (5,268)
Voluntary Employee
Retirement Program - - - -
Operating Income (Loss) 20,178 6,621 (1,666) 25,133
Interest and Dividend Income 567 - 88 655
Interest Expense (1,902) - (2,396) (4,298)
Other Income (Expense), net 256 (40) 46 262
Income (Loss) before Income
Taxes 19,099 6,581 (3,928) 21,752
Provision (Benefit) for
Income Taxes (1) (2) 4,768 354 (1,154) 3,968
Income (Loss) before Equity
in Unconsolidated Entities 14,331 6,227 (2,774) 17,784
Equity in Unconsolidated
Entities - 200 - 200
Net Income (Loss) $ 14,331 $ 6,427 $(2,774) $ 17,984
========= ========= ======== =========
(1) In 2002, CT, CTSI and Total include the effect of year-to-date tax
benefits which were recorded in the third quarter in connection
with certain tax strategies of $0.2m, $0.7m and $0.9m,
respectively.
(2) In 2001, CT, CTSI and Total include the effect of year-to-date tax
benefits which were recorded in the third quarter in connection
with certain tax strategies of $3.4m, $2.1m and $5.5m,
respectively.
COMMONWEALTH TELEPHONE ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
(Dollars in Thousands)
NINE MONTHS ENDED SEPTEMBER 30, 2002
-----------------------------------------
CT CTSI OTHER TOTAL
-- ---- ----- -----
Sales $146,876 $ 63,101 $27,023 $237,000
Costs & Expenses (excluding
other operating expenses
itemized below) 51,599 40,349 25,478 117,426
Management Fees 900 297 (297) 900
--------- --------- -------- ---------
EBITDA 94,377 22,455 1,842 118,674
Depreciation & Amortization 33,753 13,861 2,992 50,606
Restructuring Charges
(Reversals) - (2,057) - (2,057)
Voluntary Employee
Retirement Program - - 2,333 2,333
Operating Income (Loss) 60,624 10,651 (3,483) 67,792
Interest and Dividend Income 1,563 - 196 1,759
Interest Expense (3,880) - (5,514) (9,394)
Other Income (Expense), net (203) 322 (112) 7
Income (Loss) before Income
Taxes 58,104 10,973 (8,913) 60,164
Provision (Benefit) for
Income Taxes (1) (2) 22,170 4,156 (3,140) 23,186
Income (Loss) before Equity
in Unconsolidated Entities 35,934 6,817 (5,773) 36,978
Equity in Unconsolidated
Entities - 1,704 - 1,704
Net Income (Loss) $ 35,934 $ 8,521 $(5,773) $ 38,682
========= ========= ======== =========
NINE MONTHS ENDED SEPTEMBER 30, 2001
-----------------------------------------
CT CTSI OTHER TOTAL
-- ---- ----- -----
Sales $140,370 $59,381 $29,885 $229,636
Costs & Expenses (excluding
other operating expenses
itemized below) 50,229 48,936 30,083 129,248
Management Fees 900 297 (297) 900
--------- --------- -------- ---------
EBITDA 89,241 10,148 99 99,488
Depreciation & Amortization 31,384 12,538 4,043 47,965
Restructuring Charges
(Reversals) - (8,678) - (8,678)
Voluntary Employee
Retirement Program - - - -
Operating Income (Loss) 57,857 6,288 (3,944) 60,201
Interest and Dividend Income 1,790 - 430 2,220
Interest Expense (5,963) (1) (8,692) (14,656)
Other Income (Expense), net (140) 473 1 334
Income (Loss) before Income
Taxes 53,544 6,760 (12,205) 48,099
Provision (Benefit) for
Income Taxes (1) (2) 19,313 909 (4,063) 16,159
Income (Loss) before Equity
in Unconsolidated Entities 34,231 5,851 (8,142) 31,940
Equity in Unconsolidated
Entities - 1,609 - 1,609
Net Income (Loss) $ 34,231 $ 7,460 $(8,142) $ 33,549
========= ========= ======== =========
(1) In 2002, CT, CTSI and Total include the effect of year-to-date tax
benefits which were recorded in the third quarter in connection
with certain tax strategies of $0.2m, $0.7m and $0.9m,
respectively.
(2) In 2001, CT, CTSI and Total include the effect of year-to-date tax
benefits which were recorded in the third quarter in connection
with certain tax strategies of $3.4m, $2.1m and $5.5m,
respectively.
COMMONWEALTH TELEPHONE ENTERPRISES, INC.
CTSI SEGMENT
(UNAUDITED)
(Dollars in Thousands)
3RD QUARTER 2002 3RD QUARTER 2001
------------------------- --------------------------
CTSI CTSI TOTAL CTSI CTSI TOTAL
Edge-out Expansion CTSI Edge-out Expansion CTSI
------------------------- --------------------------
Sales $ 20,896 $ - $ 20,896 $ 18,889 $ - $ 18,889
Costs & Expenses
(excluding other
operating
expenses
itemized below) 13,869 - 13,869 13,053 - 13,053
Management Fees 99 - 99 99 - 99
-------- ------- -------- -------- ------- ---------
EBITDA $ 6,928 $ - $ 6,928 $ 5,737 $ - $ 5,737
======== ======= ======== ======== ======= =========
NINE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, 2002 SEPTEMBER 30, 2001
------------------------- --------------------------
CTSI CTSI TOTAL CTSI CTSI TOTAL
Edge-out Expansion CTSI Edge-out Expansion CTSI
------------------------- --------------------------
Sales $ 63,101 $ - $ 63,101 $ 53,818 $ 5,563 $ 59,381
Costs & Expenses
(excluding other
operating
expenses
itemized below) 40,349 - 40,349 40,723 8,213 48,936
Management Fees 297 - 297 297 - 297
-------- ------- -------- -------- ------- ---------
EBITDA $ 22,455 $ - $ 22,455 $ 12,798 $(2,650)$ 10,148
======== ======= ======== ======== ======= =========
COMMONWEALTH TELEPHONE ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
QUARTERS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------- -----------------------
2002 2001 2002 2001
Basic Earnings per
Average Common Share:
Net Income (Loss) $0.59 $0.77 $1.65 $1.45
======================= =======================
Weighted Average Common
Shares Outstanding 23,414,836 23,307,195 23,380,673 23,096,803
Diluted Earnings per
Average Common Share:
Net Income (Loss) $0.58 $0.76 $1.63 $1.43
======================= =======================
Weighted Average Common
Shares and Common
Stock Equivalents
Outstanding 23,664,137 23,679,606 23,676,699 23,523,206
COMMONWEALTH TELEPHONE ENTERPRISES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Dollars in Thousands)
September December
30, 31,
2002 2001
----------------------
ASSETS
CURRENT ASSETS:
Cash and Temporary Cash Investments $ 34,537 $ 27,298
Accounts Receivable from Related Parties 14 249
Other Current Assets 58,908 61,994
Deferred Income Taxes 20,545 20,115
----------------------
Total Current Assets 114,004 109,656
----------------------
PROPERTY PLANT AND EQUIPMENT (NET OF
ACCUMULATED DEPRECIATION OF $416,438 IN 2002
AND $381,888 IN 2001) 413,706 428,916
INVESTMENTS 10,890 9,428
DEFERRED CHARGES AND OTHER ASSETS 14,169 16,604
----------------------
TOTAL ASSETS $ 552,769 $ 564,604
======================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes Payable $ 65,000 $ 65,000
Current Maturities of Long Term Debt 9,010 9,010
Advance Billings and Customer Deposits 5,436 5,258
Accrued Interest 1,298 1,701
Accrued Income Taxes 109 -
Accrued Restructuring Expenses 3,992 7,381
Accounts Payable to Related Parties 876 1,424
Other Current Liabilities 75,046 92,985
----------------------
Total Current Liabilities 160,767 182,759
----------------------
COMMONWEALTH TELEPHONE ENTERPRISES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Dollars in Thousands)
September December
30, 31,
2002 2001
----------------------
LONG TERM DEBT 104,552 151,309
CAPITAL LEASE OBLIGATION 219 317
DEFERRED INCOME TAXES 46,384 33,779
OTHER DEFERRED CREDITS 36,191 30,924
COMMON SHAREHOLDERS' EQUITY:
Common Stock 27,306 27,265
Additional Paid-in Capital 256,690 255,570
Deferred Compensation (3,610) (4,306)
Other Comprehensive Loss (4,278) (2,879)
Retained Earnings 59,527 20,845
Treasury Stock at Cost, 3,821,883 shares at
September 30, 2002 and at December 31, 2001 (130,979) (130,979)
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Total Common Shareholders' Equity 204,656 165,516
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 552,769 $ 564,604
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