ANCHORAGE, Alaska--(BUSINESS WIRE)--Through capital investments and innovative technologies, Alaska Communications is doubling down on its focus to provide Alaskans with broadband solutions that meet the demands of today’s fast-paced world. Since 2017, the broadband provider has deployed high-speed internet to more than 25,000 unserved or underserved locations, through the CAF II program. In 2023, it brought affordable, reliable, high-speed internet to new locations in Delta Junction, Fairbanks, Nenana, ...

The Zacks Wireless National industry appears to be mired in high capital expenditures for infrastructure upgrades, margin woes, supply-chain disruptions amid the prolonged Russia-Ukraine war and Israel-Hamas conflict, soft China market conditions and high customer inventory levels. However, the industry is likely to benefit in the long run from an accelerated 5G rollout and increased fiber densification.In this backdrop, T-Mobile US Inc. (TMUS) , United States Cellular Corporation (USM) and ATN Internationa ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-12593 ATN INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdi ...

Financial Data and Key Metrics Changes - ATN's Q3 revenues grew 5% to $191 million, driven by network investments [10] - Operating income increased to $6.8 million from $1.4 million in the prior year [10] - Adjusted EBITDA grew 10% to $47.8 million, supported by strong domestic business performance [10] - The total net loss for the quarter was $3.6 million, compared to a net loss of $2.8 million in Q3 2022, primarily due to a $5.8 million increase in interest expense [11] Business Line Data and Key Metrics Changes - International segment revenues grew 4% to nearly $94 million, while adjusted EBITDA decreased slightly to $27.5 million due to elevated operating expenses [11][12] - Domestic segment revenues grew 5% to $97 million, with adjusted EBITDA rising 22% to $26.9 million, driven by higher revenues and cost reduction initiatives [13] Market Data and Key Metrics Changes - High-speed broadband subscriber growth was robust at 20% year-on-year, with a 13% annual increase in mobile subscribers in international markets [6] - The company exceeded 400,000 international mobile subscribers, indicating strong growth in high-speed broadband [12] Company Strategy and Development Direction - The company is focused on executing its Glass and Steel and First-to-Fiber strategies, which aim to enhance high-speed data services in underserved areas [5][6] - ATN is committed to managing its balance sheet and spending levels to maximize free cash flow over time [5] - The company anticipates a preliminary adjusted EBITDA outlook for 2024 in the range of $200 million to $208 million, with CapEx spending expected to be between $120 million and $130 million [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in subscriber growth and organic revenue growth rates, despite some concerns regarding the expiration of a significant COVID-related contract [23][25] - The company aims to reduce leverage to around two times, enhancing financial flexibility for shareholder returns [28] Other Important Information - ATN received nearly $45 million in federal grants to expand high-speed internet access in underserved areas, following over $155 million in grants awarded in the previous year [7] - The company ended the quarter with cash and cash equivalents of $73 million and total debt outstanding of $498 million, maintaining a consolidated net debt to adjusted EBITDA ratio of 2.3 times [17] Q&A Session Summary Question: What is the level of visibility for the preliminary 2024 guidance? - Management feels confident about the preliminary guidance, citing a large portion of recurring revenue and manageable puts and takes [23] Question: Why is there no revenue guidance provided? - The focus is on EBITDA and free cash flow, which are seen as more stable metrics compared to revenue [25] Question: What are the expectations for segment margins, particularly in the international segment? - Margins are expected to expand as subscriber and revenue growth continues, despite some unusual spending in the current quarter [36] Question: How does the company view fixed wireless high-speed internet? - Management sees fixed wireless as part of the mix in all markets, with varying degrees of implementation based on population density and technology availability [46] Question: What are the thoughts on direct-to-device satellite connectivity? - Management views it as a valuable tool for customer connectivity, especially in remote areas, and anticipates growing demand for such functionality [49]

Investor Presentation Nasdaq: ATNI Third Quarter 2023 ATN International Vision, Mission & Core Values ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-12593 ATN INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction ...

Subscriber Growth - Broadband homes passed increased by 22% year-over-year, reaching over 746,000[5] - Broadband customers grew by 6% year-over-year, exceeding 217,000[5] - High-speed data (HSD) broadband customers now represent 59% of the total broadband customer base[5] - International mobile subscribers increased by 14% year-over-year to 399,100, with stable blended mobile churn rates[6] Financial Performance - Total consolidated revenues increased by 4% year-over-year to $186 million[16] - Adjusted EBITDA increased by 10% year-over-year to $46 million[16] - International Telecom revenue was $92 million, while US Telecom revenue was $94 million[15] Future Outlook - The company anticipates full-year Adjusted EBITDA to be in the range of $183 million to $193 million[30] - Capital expenditures for the full year are projected to be between $160 million and $170 million, primarily for network expansion and upgrades[30] - The company projects a revenue CAGR of 4-6% and an Adjusted EBITDA CAGR of 8-10% over the three-year period from 2022 to 2024, excluding construction revenue[31]

Financial Data and Key Metrics Changes - Total Q2 consolidated revenues increased by 4% year-over-year, with operating income improving to $2.4 million from $1.7 million last year, and adjusted EBITDA rising 10% to $4.1 million driven by strong subscriber growth [16][19] - Total net income for the quarter increased to $800,000, reflecting a loss of $0.03 per share, which includes the impact of preferred dividends [16] Business Line Data and Key Metrics Changes - International revenues rose 4% in the quarter, with adjusted EBITDA up 7%, driven by strong broadband and mobile subscriber growth, partially offset by a reduction in federal high-cost support subsidies for the U.S. Virgin Islands [17] - In the U.S. segment, revenues were up 4% due to growth in fixed revenues from strong enterprise sales in Alaska, despite reductions in legacy roaming revenues [18] Market Data and Key Metrics Changes - The high-speed subscriber base and international mobile subscriber base each grew by double digits, with homes passed by high-speed data networks increasing 10% sequentially and 66% year-over-year [8][9] - The international mobile subscriber base reached over 399,000, marking a 14% increase from the same period last year [9] Company Strategy and Development Direction - The company is focused on its Glass & Steel and First-to-Fiber strategies, targeting regions such as Alaska, the Western U.S., rural tribal lands, and the Caribbean [7] - A long-term agreement with Verizon Wireless was announced, emphasizing the transition from wholesale roaming services to providing infrastructure and technical services, which will generate stable long-term recurring revenue [10][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's competitive positioning and the positive momentum heading into the second half of 2023, driven by growing revenue, improved margins, and expanding subscriber bases [14] - The company expects to reduce capital expenditures and increase operating cash flows, aiming to lower the net leverage ratio by the end of 2024 [22] Other Important Information - The company completed a $300 million debt refinancing, extending and expanding its senior secured credit facilities, which enhances financial flexibility [13][21] - The company was awarded a $10 million grant to build a fiber and fixed wireless network in New Mexico, which will serve over 11,000 unserved and underserved locations [11] Q&A Session Summary Question: Was the recent acquisition the November acquisition of Sacred Wind? - Yes, it was the last year's acquisition of Sacred Wind [26] Question: Is the Verizon contract more about recurring revenues rather than construction? - Yes, it will be more consistent recurring revenue without construction revenue [28] Question: Are there any near-term headwinds from the new North American wireless carrier contract? - No, there are no near-term headwinds anticipated [38] Question: Will interest rates impact capital expenditure plans? - Interest expense has increased, but there has been no need to adjust capital spending plans based on interest expense [40] Question: What is the status of government subsidies and BEAD? - The company is working with local state broadband offices to identify sustainable projects for the BEAD program [43] Question: What metrics will be provided for 2024 guidance? - The focus will be on key metrics such as EBITDA and CapEx, with no specific guidance on subscriber metrics at this time [49]

PART I [Item 1. Unaudited Condensed Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Unaudited Q1 2023 financials show revenue growth to $185.8 million, but a net loss of $7.1 million due to higher expenses [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2023, total assets slightly decreased to $1.70 billion, while total liabilities increased to $942.3 million and equity declined Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Total Assets** | **$1,700,015** | **$1,707,869** | | Cash and cash equivalents | $56,016 | $54,660 | | Net fixed assets | $1,056,363 | $1,055,954 | | **Total Liabilities** | **$942,266** | **$938,571** | | Long-term debt, including current portion | $464,681 | $421,900 | | **Total Equity** | **$664,526** | **$676,829** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2023 revenue grew 8.0% to $185.8 million, but net loss widened to $7.1 million due to higher operating and interest expenses Q1 2023 vs. Q1 2022 Statement of Operations (in thousands, except per share data) | Metric | Q1 2023 | Q1 2022 | | :--- | :--- | :--- | | Total Revenue | $185,774 | $172,019 | | Income from Operations | $636 | $108 | | Interest Expense | $(8,807) | $(3,363) | | Net Loss | $(7,055) | $(1,957) | | Net Loss Attributable to ATN Stockholders | $(5,885) | $(948) | | Diluted Net Loss Per Share | $(0.44) | $(0.13) | | Dividends Per Share | $0.21 | $0.17 | - The company recorded a **$2.9 million restructuring expense** in Q1 2023, which was not present in the prior-year period[12](index=12&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2023 operating cash flow improved to $16.0 million, while investing activities used $52.8 million and financing provided $38.0 million Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $16,012 | $11,388 | | Net cash used in investing activities | $(52,762) | $(34,468) | | Net cash provided by financing activities | $37,999 | $19,228 | | **Net change in cash** | **$1,249** | **$(3,852)** | - Capital expenditures increased to **$50.6 million** in Q1 2023 from $34.2 million in Q1 2022[21](index=21&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail business segments, the Sacred Wind acquisition, upcoming debt maturity, government program reliance, and a new Verizon agreement - The company operates through two segments: International Telecom (Bermuda, Cayman Islands, Guyana, US Virgin Islands) and US Telecom (Alaska and the western United States)[30](index=30&type=chunk) - On November 7, 2022, the company acquired Sacred Wind Enterprises for **$44.6 million**, with purchase price allocation finalized in Q1 2023[65](index=65&type=chunk) - Subsequent to quarter end, on May 10, 2023, Commnet signed a seven-year Carrier Managed Services Master Agreement with Verizon, estimated at approximately **$200 million** over the initial term[147](index=147&type=chunk)[149](index=149&type=chunk) - The company's 2019 CoBank Credit Facility, with **$122.0 million** outstanding, matures on April 10, 2024, with refinancing actively pursued for 2023[32](index=32&type=chunk)[34](index=34&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=51&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2023 revenue growth driven by segment performance and acquisitions, increased net loss due to higher expenses, and critical debt refinancing needs [Results of Operations](index=58&type=section&id=Results%20of%20Operations) Q1 2023 total revenue increased 8.0% to $185.8 million, driven by both International and US Telecom segments, despite minimal operating income Revenue by Segment (in thousands) | Segment | Q1 2023 Revenue | Q1 2022 Revenue | % Change | | :--- | :--- | :--- | :--- | | International Telecom | $90,408 | $86,787 | 4.1% | | US Telecom | $95,367 | $85,232 | 12.0% | | **Total Revenue** | **$185,774** | **$172,019** | **8.0%** | - Fixed revenue increased by **12.7%** to **$117.8 million**, driven by growth in Alaska and the Sacred Wind acquisition[187](index=187&type=chunk)[188](index=188&type=chunk) - A **$2.9 million restructuring charge** was recorded in Q1 2023 related to decommissioning cell sites in the US Telecom segment[212](index=212&type=chunk) - Interest expense more than doubled to **$8.8 million** from $3.4 million year-over-year due to increased borrowings and higher interest rates[218](index=218&type=chunk) [Liquidity and Capital Resources](index=75&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2023, the company had $61.0 million cash and $464.7 million debt, with a critical CoBank Credit Facility refinancing due April 2024 - The 2019 CoBank Credit Facility, with **$122.0 million** outstanding, matures in April 2024, creating a significant refinancing need[266](index=266&type=chunk) - Management is actively pursuing debt financing options to extend the maturity, expecting completion during 2023[266](index=266&type=chunk) - Full-year 2023 capital expenditures are projected to be between **$160 million** and **$170 million**, net of reimbursable amounts[234](index=234&type=chunk) - The company repurchased **$1.4 million** of its common stock in Q1 2023, with **$18.0 million** remaining authorized for future repurchases[238](index=238&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=89&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are foreign currency fluctuations, mainly from Guyana operations, and interest rate sensitivity on its $372.6 million variable-rate debt - The company's main foreign currency exposure is to the Guyana Dollar[272](index=272&type=chunk) - As of March 31, 2023, **$372.6 million** of variable-rate debt was outstanding; a 100-basis-point change in interest rates would alter annual interest expense by **$3.7 million**[275](index=275&type=chunk) [Item 4. Controls and Procedures](index=91&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2023, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of March 31, 2023, the company's disclosure controls and procedures were effective[276](index=276&type=chunk) - No material changes in internal control over financial reporting were identified during the quarter[277](index=277&type=chunk) PART II—OTHER INFORMATION [Item 1. Legal Proceedings](index=91&type=section&id=Item%201.%20Legal%20Proceedings) Legal proceedings, detailed in Note 14, primarily involve GTT in Guyana and Alaska Communications, with **$15.3 million** accrued for potential liabilities - For details on legal proceedings, the report directs readers to Note 14 of the Unaudited Condensed Consolidated Financial Statements[278](index=278&type=chunk) - As of March 31, 2023, the company has accrued **$15.3 million** for various probable claims, legal actions, and regulatory proceedings[144](index=144&type=chunk) [Item 1A. Risk Factors](index=91&type=section&id=Item%201A.%20Risk%20Factors) A key risk factor is the ability to refinance the 2019 CoBank Credit Facility, maturing April 2024 with **$122.0 million** outstanding - A significant risk is the maturity of the 2019 CoBank Credit Facility on April 10, 2024, with **$122.0 million** outstanding as of March 31, 2023[282](index=282&type=chunk) - Inability to refinance this debt on favorable terms could adversely impact operations or financial results[282](index=282&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=93&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2023, the company repurchased 71,563 shares of common stock, with **$18.0 million** remaining authorized under the 2016 Repurchase Plan Share Repurchases in Q1 2023 | Period | Total Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Plan | | :--- | :--- | :--- | :--- | | Jan 2023 | — | $— | — | | Feb 2023 | — | $— | — | | Mar 2023 | 71,563 | $39.69 | 35,656 | - As of March 31, 2023, **$18.0 million** remains authorized for share repurchases under the 2016 Repurchase Plan[283](index=283&type=chunk) [Item 5. Other Information](index=95&type=section&id=Item%205.%20Other%20Information) A significant subsequent event is Commnet Wireless's seven-year Carrier Managed Services Master Agreement with Verizon, valued at approximately **$200 million** - On May 10, 2023, subsidiary Commnet entered into a Carrier Managed Services Master Agreement with Verizon Wireless[286](index=286&type=chunk) - The agreement has an initial seven-year term and is expected to generate approximately **$200 million** in total payments from Verizon[287](index=287&type=chunk)[288](index=288&type=chunk) [Item 6. Exhibits](index=96&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - The report includes standard exhibits such as Sarbanes-Oxley certifications (31.1, 31.2, 32.1, 32.2) and XBRL data files[291](index=291&type=chunk)

Financial Data and Key Metrics Changes - Total consolidated revenues increased by 8% year-over-year, reaching the highest level in over a decade [17][10] - Operating income improved to $0.6 million from $0.1 million a year ago [17] - Adjusted EBITDA rose by 6% year-over-year, driven by strength in the international segment and steady domestic results [17][18] - Net loss for the quarter increased to $5.9 million, or a loss of $0.44 per share, primarily due to a $5.4 million increase in interest expense [21] Business Line Data and Key Metrics Changes - International segment revenues rose by 4%, with adjusted EBITDA up by 5%, supported by growth in broadband and mobile subscribers [18] - U.S. segment revenues increased by 12%, with adjusted EBITDA up by 16%, mainly due to strong performance in Alaska and the Sacred Wind acquisition [19][21] - Homes passed by broadband networks grew to approximately 736,000, a 21% increase year-over-year [11] Market Data and Key Metrics Changes - Mobile subscribers in the international segment increased by 13% year-over-year, reaching over 328,000 [11] - 55% of broadband subscribers were connected to fiber or higher-speed networks, reflecting an 18% year-over-year growth in high-speed data subscribers [11] Company Strategy and Development Direction - The company is focused on providing connectivity in underserved areas, including the Caribbean and rural U.S. regions [5][6] - Strategic initiatives include "glass and steel" and "first to fiber," aimed at expanding market leadership and improving customer retention [6][7] - The company is investing in quality assets to enhance market position and reduce customer churn [7][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the durability of revenue and long-term growth prospects, tracking to the three-year plan established in 2022 [10][14] - The company anticipates continued revenue and EBITDA growth trends throughout 2023 [10][25] - Management highlighted the importance of maintaining financial flexibility to support strategic investments [15][16] Other Important Information - The company reported core CapEx for the quarter of $50.6 million, with expectations for lower CapEx spending for the remainder of the year [22][24] - The consolidated net debt to adjusted EBITDA ratio was 2.3 times, indicating a strong balance sheet [23] Q&A Session Summary Question: Update on FirstNet contract completion and revenue expectations - Management indicated that the FirstNet project is about 75% complete, with revised revenue expectations of $12 million to $14 million for the year [28][30] Question: Impact of Sacred Wind acquisition on guidance - The Sacred Wind acquisition is included in the overall guidance, contributing approximately $10 million of annual EBITDA [32] Question: Market share and growth opportunities in international wireless - Management noted that subscriber growth is primarily from taking market share rather than overall market growth [46] Question: Future CapEx expectations - Management expects CapEx to step down significantly in 2024, with a gradual decrease starting next year [44][45] Question: Preparations for roaming business changes - Management believes they have accounted for necessary charges and will continue to utilize existing towers while phasing out some sites [51] Question: Seasonality in Alaska's fiber build business - There is minimal seasonality in the Alaska business, although certain quarters may see larger numbers due to project timing [52][53]