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]
ATN International(ATNI) - 2023 Q3 - Earnings Call Transcript