ATN International(ATNI) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total company revenue for Q1 2025 was $179.3 million, down 4% year over year, primarily due to the wind down of COVID-era government subsidy programs [16] - Adjusted EBITDA increased by 2% to$ 44.3 million, supported by growth in the international segment [17] - Net loss for Q1 was $8.9 million, compared to a net loss of$ 6.3 million in the prior year [16][17] - Cash from operations increased by 55% to $35.9 million, reflecting improved working capital management [20] Business Line Data and Key Metrics Changes - International segment revenues increased to$ 94.5 million, up from $93.1 million year over year, driven by carrier services growth [18] - Adjusted EBITDA for the international segment rose to$ 32.4 million, an increase of 10% year over year [18] - Domestic segment revenues were $84.8 million, down 9.5% year over year, impacted by the conclusion of government subsidy programs [19] Market Data and Key Metrics Changes - The number of broadband homes passed by high-speed data services increased by 11% year on year to 427,000 households [8] - High-speed subscriber base grew by 2% year on year, indicating steady demand for broadband services [8] Company Strategy and Development Direction - The company aims to grow its fiber and fiber-fed business while transitioning from legacy consumer services [10] - Approximately$ 370 million in government-funded broadband infrastructure projects are underway, with over half expected to be completed in 2025 [11] - The focus remains on expanding high-speed broadband and business services in international markets while stabilizing the U.S. business around sustainable revenue streams [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macroeconomic uncertainties but expressed confidence in operational performance and disciplined investment strategies [6] - The company reaffirmed its 2025 outlook, expecting revenue to align with 2024 levels, excluding construction revenue [22] - Management is monitoring trade and tariff developments, believing they can manage any near-term impacts within the existing financial outlook [13] Other Important Information - The company plans to shift the timing of its earnings release and calls by approximately one week to better align with its 10-Q filing [4][5] - Capital expenditures in Q1 totaled $20.8 million, a reduction from$ 36 million in the prior year's quarter, reflecting a shift towards increasing operational cash flow [21] Q&A Session Summary Question: How insulated is the company from trade and tariff impacts? - The company sources a significant portion of its fiber construction materials in the U.S., while electronics are monitored closely due to potential tariff impacts [31][33] Question: What is the company's exposure to foreign exchange rates? - The majority of international operations are in stable markets, with no significant fluctuations observed so far [35] Question: How does the company view the marketplace regarding private versus public multiples? - The company is observing the vibrant market dynamics and is focused on unlocking value for investors [36] Question: How will government funding impact financials? - Approximately half of the $370 million in government funding projects are expected to be completed in 2025, with significant monetization anticipated in 2026 and 2027 [40][41] Question: What is the outlook for the BEAD program? - The company is participating in the BEAD program, with funding dynamics being monitored closely, and expects delays in award timing [44][46] Question: What progress has been made in monetizing investments? - New leadership teams have been established, and there is growing carrier demand for access and transport services, indicating positive progress [49][51]