Atlantic Tele-Network, Inc. (NASDAQ: ATNI), today reported results for the third quarter ended September 30, 2011.
Third Quarter 2011 Financial Results
”This was a strong quarter for us in many key areas,” noted Michael Prior, Chief Executive Officer. “The significant year-over-year and sequential improvements in profitability were mainly driven by cost reductions with the completion of the transition of Alltel customers to our own operating platform, billing system and customer care centers in late July. Adjusted EBITDA margin for the U.S. Wireless segment reached 28% for the period, representing a substantial increase over the prior year and recent quarters, as overlapping expenses were markedly reduced. Our third quarter U.S. wireless subscriber metrics, however, lagged expectations. While we believe that gross subscriber additions, in particular, were affected by certain constraints we put in place just prior to and subsequent to the final transition, and had expected to see some pick up in churn in the immediate aftermath of conversion, it is clear that we have more to do to see improved subscriber metrics.
“Third quarter profitability also benefited from seasonally high roaming revenues and improved results from our international businesses. These results demonstrate the earnings potential that ATN has gained through the Alltel asset acquisition and the continued solid contributions from our other businesses.”Total revenues for the third quarter were $194.3 million, a 5% decline from the $205.0 million reported for the third quarter of 2010. Adjusted EBITDA 1 for the 2011 third quarter was $52.0 million, an increase of 38% over the $37.8 million reported in last year’s third quarter. The Company estimates that duplicate transition-related expenses were approximately $4.9 million in the third quarter of 2011, offset in part by other one-time benefits of approximately $3.6 million mainly related to out of period ETC revenues and USF expense adjustments. Wireless retail revenues were also negatively impacted this quarter by approximately $2.3 million related to the decision to forego the billing of certain items for a period following the system conversion. Duplicate transition-related expenses and the net impact of other one-time items were approximately $10.0 million in the 2010 third quarter. Total operating income was $27.6 million, twice the $13.8 million reported in last year’s third quarter. Third quarter 2011 operating income included a $2.7 million increase in depreciation and amortization expenses over the prior year’s third quarter. Net income attributable to ATN’s stockholders was $11.3 million, or $0.73 per diluted share, up from the $6.4 million, or $0.41 per diluted share, earned in the third quarter of 2010.