CHICAGO, July 16 /PRNewswire-FirstCall/ --
Telephone and Data Systems, Inc. (AMEX: TDS) reported operating revenues of
$723.8 million for the second quarter of 2002, up 13% from $642.3 million in
the comparable period a year ago. Operating income increased $7.8 million or
6% to $130.1 million in the second quarter of 2002 from $122.2 million in the
second quarter of 2001. Operating cash flow (a non-GAAP measurement of
operating income plus depreciation and amortization expense) increased 6% to
$245.7 million from $231.6 million in the second quarter of a year ago.
Diluted earnings per share from continuing operations were a loss of $16.17
per share compared to a loss of $5.79 share in the second quarter a year ago.
Diluted earnings per share from continuing operations, excluding gains and
(losses), net of tax and minority interest, of ($1,021.8 million) in 2002 and
($385.2 million) in 2001, and excluding amortization of goodwill and
indefinite lived intangibles in 2001 of $7.3 million, net of tax and minority
interest (a non-GAAP measurement of normalized earnings per share from
operations), were $1.25 compared to $.89 in the second quarter a year ago.
LeRoy T. Carlson, Jr., President and Chief Executive Officer said: "Our
businesses continued to record very solid operating results in the quarter.
Total company revenues grew nearly 13% with each of the principal businesses
posting double digit revenue growth. We believe this is excellent performance
given the soft but hopefully improving economy.
"Our wireless business, U.S. Cellular, grew total revenues 11% in the
quarter. We were particularly pleased to see average monthly revenue per unit
(ARPU) improve year to year. Also the post pay churn rate was an impressive
1.7% for the quarter, amongst the lowest for the entire wireless sector. This
result again emphasizes the point that if you take care of your customers they
will stay with you despite the highly promotional nature of the business.
"TDS Telecom, our wireline ILEC business, did well in the quarter as well.
Revenues were up nearly 12%, reflecting the benefits of acquisitions made
earlier this year and last, and organic line growth of over 5,800 equivalent
access lines. Vertical services penetration was up while the number of DSL
(digital subscriber line) customers grew impressively as well. TDS Metrocom,
our competitive local exchange carrier (CLEC), which does business in
Wisconsin, Illinois and Michigan, did well in the quarter recording revenue
growth of 77%."
As previously announced, in the second quarter of 2002, TDS determined
that the decline in value of its investments in marketable securities relative
to its cost basis was other than temporary. A loss on the securities of
$1,719 million was recorded in the income statement, reducing net income and
earnings per share by $1,021.8 million and $17.42, respectively. The
recognition of this loss had no impact on cash flows. TDS adjusts the value of
its marketable equity securities on a regular basis to ensure that its balance
sheet always reflects the current market value of those securities. Management
continues to review the valuation of these investments periodically.
On May 31, TDS completed the purchase of MCT, Inc. of Contoocook, NH and
on July 1, TDS completed the purchase of the Telecommunication Systems of New
Hampshire, Inc. (TSNH), of Wilton, NH. Together the companies represent over
26,000 access lines and 6,000 ISP and DSL customers as well as a number of
other businesses. MCT's 19,200 access lines are reflected in TDS Telecom
totals for this quarter. TSNH lines will be reflected in third quarter
results.
TDS adopted Statement of Financial Accounting Standards("SFAS") No. 142
effective January 1, 2002, and ceased the amortization of license costs and
goodwill on that date. For the three months ended June 30, 2001, amortization
of license costs and goodwill included in U.S.Cellular's and TDS Telecom's
depreciation and amortization captions totaled $8.8 million and $1.7 million,
respectively. The aggregate effect of ceasing amortization increased net
income and earnings per diluted share by $7.3 million and $.12, respectively.
The amounts reported for "operating cash flow" do not represent cash flows
from operations as defined by GAAP and amounts reported for "diluted earnings
per share from continuing operations excluding gains and losses and
amortization of goodwill and indefinite lived intangibles" do not represent
earnings per share determined in accordance with GAAP. TDS believes that
these are useful measures of its performance but they should not be construed
as alternatives to measures of performance determined under GAAP.
All information set forth in this news release, except historical and
factual information, represents forward-looking statements. This includes all
statements about the Company's plans, beliefs, estimates and expectations.
These statements are based on current estimates and projections, which involve
certain risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements. Important factors
that may affect these forward-looking statements include, but are not limited
to: changes in circumstances or events that may affect the ability of USM to
acquire or, if it acquires, to integrate the operations of the Chicago MTA;
changes in the overall economy; changes in competition in the markets in which
TDS operates; advances in telecommunications technology; changes in the
telecommunications regulatory environment; changes in the value of
investments; changes in the capital markets that could restrict the
availability of financing; pending and future litigation;
acquisitions/divestitures of properties and/or licenses; changes in customer
growth rates, penetration rates, churn rates, roaming rates and the mix of
products and services offered in TDS's markets. Investors are encouraged to
consider these and other risks and uncertainties that are discussed in
documents filed by TDS with the SEC.
TDS is a diversified telecommunications corporation founded in 1969.
Through its strategic business units, U.S. Cellular and TDS Telecom, TDS
operates primarily by providing wireless and local telephone service. TDS
builds value for its shareholders by providing excellent communications
services in growing, closely related segments of the telecommunications
industry. The Company currently employs approximately 9,800 people and serves
approximately 4.5 million customers/units in 34 states.
As previously announced, TDS and its subsidiaries will hold a joint
teleconference on July 16, 2002, at 10:00 am Chicago time. Interested
parties may listen to the call live over the Internet at
http://www.firstcallevents.com/service/ajwz361543803gf12.html or connect by
telephone at 888/245-6674 leader: Mark Steinkrauss/TDS. The conference call
will also be archived on the conference call section of our website at
www.teldta.com .
For more information about TDS and its subsidiaries, visit the web sites
at:
TDS: http://www.teldta.com TDS Telecom: http://www.tdstelecom.com
USM: http://www.uscellular.com TDS Metrocom http://www.tdsmetro.com
TELEPHONE AND DATA SYSTEMS, INC.
SUMMARY OPERATING DATA
Quarter Ended 6/30/2002 3/31/2002 12/31/2001
U.S. Cellular:
Total cellular population equivalents
(owned and acquirable, 000s) 27,420 27,420 27,420
Total PCS population equivalents
(owned and acquirable, 000s)
Owned by USM 16,142 4,955 4,955
Owned through joint ventures with
designated entities (A) 1,862 1,628 1,628
TDS's proportionate share of USM pops 82.2% 82.2% 82.4%
Consolidated Markets:
Total population (000s) (B) 27,548 27,548 25,670
Customer units 3,547,000 3,504,000 3,461,000
Net customer unit activations 43,000 31,000 82,000
Market penetration - cellular and
PCS markets (B) 12.88% 12.72% 13.48%
Market penetration - cellular
markets only (B) 13.34% 13.18% 13.48%
Markets in operation - cellular and
PCS markets 148 148 142
Markets in operation - cellular
markets only 143 143 142
Cell sites in service 3,145 3,049 2,925
Average monthly revenue per unit $47.48 $44.14 $45.14
Retail service revenue per unit $37.93 $35.79 $35.51
Inbound roaming revenue per unit $5.90 $5.20 $6.18
Long-distance/other revenue per
unit $3.65 $3.15 $3.45
Minutes of use (MOU) (C) 280 237 237
Postpay churn rate per month (D) 1.7% 1.9% 1.8%
Marketing cost per gross
customer unit addition $391 $365 $357
TDS Telecom
ILECs:
Access line equivalents (E) 706,000 681,000 678,300
Growth in equivalent ILEC access
lines from prior quarter-end:
Acquisitions 19,200 --- 800
Internal growth 5,800 2,700 1,700
Access lines 671,900 651,100 650,700
Average monthly revenue
per access line equivalent $74.58 $73.35 $78.33
Internet service accounts 118,000 115,200 117,500
Digital Subscriber Lines (DSL)
customers 6,500 3,300 2,200
Long Distance customers 176,300 146,100 125,300
Caller I.D. penetration (F) (G) (H) 29.6% 29.1% 28.1%
Voicemail penetration (F) (G) (H) 13.4% 13.3% 13.2%
CLECs (G):
Access line equivalents - total
CLECs (E) 243,900 221,500 192,100
TDS Metrocom 180,900 163,800 139,300
USLink 63,000 57,700 52,800
Internet service accounts 24,600 24,400 13,700
Percent of access lines on-switch:
TDS Metrocom 100.0% 100.0% 100.0%
U.S. Link 20.5% 20.5% 20.2%
Digital Subscriber Lines (DSL):
TDS Metrocom 9,100 8,500 6,800
(A) Represents pops in PCS markets which are incremental to, and do not
overlap with, PCS markets owned by USM outright.
(B) Market penetration is calculated using 2001 Claritas population
estimates for 6/30/02 and 3/31/02 and 2000 Claritas population
estimates for all other periods.
(C) Average monthly local minutes of use (without roaming)
(D) Excluding 13,000 lines disconnected due to the bankruptcy of a
customer, postpay churn rate for 3/31/02 would be 1.8%.
(E) Access line equivalents are derived by converting high capacity data
lines to the estimated capacity of one switched access line. Basic
rate ISDN = 2 DS0s; Primary rate ISDN = 23 DS0s; T1 = 24 DS0s; Trunk
Lines = 1; DSLs = 1
(F) Caller I.D. and Voice Mail penetration is the total residential and
business one-party customers purchasing the service divided by the
total of these lines equipped for the service.
(G) Does not include Chorus data for all periods.
(H) Does not include MCT data for current period.
TELEPHONE AND DATA SYSTEMS, INC.
SUMMARY OPERATING DATA
Quarter Ended 9/30/2001 6/30/2001
U.S. Cellular:
Total cellular population equivalents
(owned and acquirable, 000s) 27,420 27,408
Total PCS population equivalents
(owned and acquirable, 000s)
Owned by USM 4,955 4,955
Owned through joint ventures with
designated entities (A) 1,227 1,090
TDS's proportionate share of USM pops 82.1% 81.9%
Consolidated Markets:
Total population (000s) (B) 25,670 25,670
Customer units 3,379,000 3,294,000
Net customer unit activations 85,000 73,000
Market penetration - cellular and
PCS markets (B) 13.16% 12.83%
Market penetration - cellular
markets only (B) 13.16% 12.83%
Markets in operation - cellular
and PCS markets 142 142
Markets in operation - cellular
markets only 142 142
Cell sites in service 2,804 2,688
Average monthly revenue per unit $47.92 $47.26
Retail service revenue per unit $36.06 $36.65
Inbound roaming revenue per
unit $7.78 $6.90
Long-distance/other revenue per
unit $4.08 $3.71
Minutes of use (MOU) (C) 230 215
Postpay churn rate per month (E) 1.8% 1.6%
Marketing cost per gross
customer unit addition $285 $346
TDS Telecom
ILECs:
Access line equivalents (D) 675,800 628,700
Growth in equivalent ILEC access
lines from prior quarter-end:
Acquisitions 44,100 ---
Internal growth 3,000 5,000
Access lines 650,200 606,000
Average monthly revenue
per access line equivalent $75.12 $73.86
Internet service accounts 111,900 81,500
Digital Subscriber Lines (DSL)
customers 1,600 800
Long Distance customers 112,300 88,200
Caller I.D. penetration (F) (G) (H) 28.0% 27.2%
Voicemail penetration (F) (G) (H) 13.0% 13.0%
CLECs (H):
Access line equivalents - total
CLECs (E) 166,900 141,800
TDS Metrocom 118,200 93,900
USLink 48,700 47,900
Internet service accounts 12,900 12,500
Percent of access lines on-switch:
TDS Metrocom 100.0% 100.0%
U.S. Link 18.0% 15.9%
Digital Subscriber Lines (DSL):
TDS Metrocom 5,300 4,200
(A) Represents pops in PCS markets which are incremental to, and do not
overlap with, PCS markets owned by USM outright.
(B) Market penetration is calculated using 2001 Claritas population
estimates for 6/30/02 and 3/31/02 and 2000 Claritas population
estimates for all other periods.
(C) Average monthly local minutes of use (without roaming)
(D) Excluding 13,000 lines disconnected due to the bankruptcy of a
customer, postpay churn rate for 3/31/02 would be 1.8%.
(E) Access line equivalents are derived by converting high capacity data
lines to the estimated capacity of one switched access line. Basic
rate ISDN = 2 DS0s; Primary rate ISDN = 23 DS0s; T1 = 24 DS0s; Trunk
Lines = 1; DSLs = 1
(F) Caller I.D. and Voice Mail penetration is the total residential and
business one-party customers purchasing the service divided by the
total of these lines equipped for the service.
(G) Does not include Chorus data for all periods.
(H) Does not include MCT data for current period.
TELEPHONE AND DATA SYSTEMS, INC.
FINANCIAL HIGHLIGHTS
Three Months Ended June 30,
(Unaudited, dollars in thousands, except per share amounts)
Increase (Decrease)
2002 2001 Amount Percent
Operating Revenues
U.S. Cellular $527,710 $475,289 $52,421 11.0%
TDS Telecom 196,104 167,012 29,092 17.4%
723,814 642,301 81,513 12.7%
Operating Expenses Before
Depreciation and
Amortization
U.S. Cellular 351,252 308,655 42,597 13.8%
TDS Telecom 126,858 102,096 24,762 24.3%
478,110 410,751 67,359 16.4%
Operating Cash Flow
(Operating Income Plus
Depreciation and
Amortization)
U.S. Cellular 176,458 166,634 9,824 5.9%
TDS Telecom 69,246 64,916 4,330 6.7%
245,704 231,550 14,154 6.1%
Depreciation and
Amortization
U.S. Cellular 76,409 73,008 3,401 4.7%
TDS Telecom 39,227 36,299 2,928 8.1%
*includes amortization of
$8,008 and $17,227,
respectively 115,636 * 109,307 * 6,329 5.8%
Operating Income
U.S. Cellular 100,049 93,626 6,423 6.9%
TDS Telecom 30,019 28,617 1,402 4.9%
130,068 122,243 7,825 6.4%
Investment and Other Income
Interest and Dividend
Income 48,167 4,052 44,115 N/M
Investment Income, Net 7,762 10,210 (2,448) (24.0%)
Gain (Loss) on Marketable
Securities and Other
Investments (1,719,126) (644,929) (1,074,197) N/M
Other (Expense), Net (A) (1,232) (287) (945) N/M
(1,664,429) (630,954) (1,033,475) N/M
Loss Before Interest and
Income Taxes (1,534,361) (508,711) (1,025,650) N/M
Interest Expense 29,096 26,270 2,826 10.8%
Minority Interest in
Income of Subsidiary
Trust 6,202 6,202 --- N/M
Loss Before Income Taxes (1,569,659) (541,183) (1,028,476) N/M
Income Tax Expense
(Benefit) (606,533) (214,430) (392,103) N/M
Loss Before Minority
Interest (963,126) (326,753) (636,373) N/M
Minority Share of
(Income), net of tax (A) 15,243 (12,964) 28,207 N/M
Net Loss (947,883) (339,717) (608,166) N/M
Preferred Dividend
Requirement (106) (115) 9 N/M
Net Loss Available to
Common $(947,989) $(339,832) $(608,157) N/M
Basic Average Common Shares
Outstanding (000s) 58,639 58,653 (14) N/M
Basic Loss Per Share $(16.17) $(5.79) $(10.38) N/M
Diluted Average Common
Shares Outstanding (000s) 58,639 58,653 (14) N/M
Diluted Loss Per Share $(16.17) $(5.79) $(10.38) N/M
Diluted EPS-- Excluding
Gains (Losses) and FAS 142
Adoption $1.25 $0.89 $0.36 40.4%
Diluted EPS-- FAS 142
Adoption --- (0.12) 0.12 N/M
Diluted EPS--Gains (Losses) (17.42) (6.56) (10.86) N/M
Diluted EPS $(16.17) $(5.79) $(10.38) N/M
(A) In accordance with SFAS No. 145, effective January 1, 2002, TDS
classifies gains and losses on the extinguishment of debt as Other
(Expense). In prior periods, these gains and losses were classified
as extraordinary items. Amounts in Other (Expense) and Minority Share
of (Income) for 2001 reflect the reclassification of $1.5 million, and
$276,000, respectively, of after-tax losses on the extinguishment of
debt to conform to current period presentation.
N/M - Percentage change not meaningful.
TELEPHONE AND DATA SYSTEMS, INC.
FINANCIAL HIGHLIGHTS
Six Months Ended June 30,
(Unaudited, dollars in thousands, except per share amounts)
Increase (Decrease)
2002 2001 Amount Percent
Operating Revenues
U.S. Cellular $1,006,130 $915,058 $91,072 10.0%
TDS Telecom 382,881 327,612 55,269 16.9%
1,389,011 1,242,670 146,341 11.8%
Operating Expenses Before
Depreciation and
Amortization
U.S. Cellular 678,074 618,602 59,472 9.6%
TDS Telecom 248,796 195,091 53,705 27.5%
926,870 813,693 113,177 13.9%
Operating Cash Flow
(Operating Income Plus
Depreciation and
Amortization)
U.S. Cellular 328,056 296,456 31,600 10.7%
TDS Telecom 134,085 132,521 1,564 1.2%
462,141 428,977 33,164 7.7%
Depreciation and
Amortization
U.S. Cellular 149,161 144,347 4,814 3.3%
TDS Telecom 78,374 71,897 6,477 9.0%
*includes amortization of
$15,340 and $35,214,
respectively 227,535 * 216,244 * 11,291 5.2%
Operating Income
U.S. Cellular 178,895 152,109 26,786 17.6%
TDS Telecom 55,711 60,624 (4,913) (8.1%)
234,606 212,733 21,873 10.3%
Investment and Other Income
Interest and Dividend
Income 50,234 9,574 40,660 N/M
Investment Income, Net 18,807 17,175 1,632 9.5%
Gain (Loss) on Marketable
Securities and Other
Investments (1,756,526) (644,929) (1,111,597) N/M
Other (Expense), Net (A) (35) (1,928) 1,893 N/M
(1,687,520) (620,108) (1,067,412) N/M
Loss Before Interest and
Income Taxes (1,452,914) (407,375) (1,045,539) N/M
Interest Expense 58,719 55,228 3,491 6.3%
Minority Interest in
Income of Subsidiary
Trust 12,405 12,405 --- N/M
Loss Before Income Taxes (1,524,038) (475,008) (1,049,030) N/M
Income Tax Expense
(Benefit) (584,448) (183,817) (400,631) N/M
Loss Before Minority
Interest (939,590) (291,191) (648,399) N/M
Minority Share of
(Income), net of tax (A) 5,304 (20,292) 25,596 N/M
Net Loss (934,286) (311,483) (622,803) N/M
Preferred Dividend
Requirement (218) (233) 15 N/M
Net Loss Available to Common $(934,504) $(311,716) $(622,788) N/M
Basic Average Common Shares
Outstanding (000s) 58,619 58,685 (66) (0.1%)
Basic Loss Per Share $(15.94) $(5.31) $(10.63) N/M
Diluted Average Common
Shares Outstanding (000s) 58,619 58,685 (66) (0.1%)
Diluted Loss Per Share $(15.94) $(5.31) $(10.63) N/M
Diluted EPS-- Excluding
Gains (Losses) and FAS 142
Adoption $1.86 $1.48 $0.38 25.7%
Diluted EPS-- FAS 142
Adoption --- (0.24) 0.24 N/M
Diluted EPS--Gains (Losses) (17.80) (6.55) (11.25) N/M
Diluted EPS $(15.94) $(5.31) $(10.63) N/M
(A) In accordance with SFAS No. 145, effective January 1, 2002, TDS
classifies gains and losses on the extinguishment of debt as Other
(Expense). In prior periods, these gains and losses were classified
as extraordinary items. Amounts in Other (Expense) and Minority Share
of (Income) for 2001 reflect the reclassification of $5.2 million, and
$917,000, respectively, of after-tax losses on the extinguishment of
debt to conform to current period presentation.
N/M - Percentage change not meaningful.
TELEPHONE AND DATA SYSTEMS, INC.
CONSOLIDATED BALANCE SHEET HIGHLIGHTS
(Unaudited, dollars in thousands)
ASSETS
June 30, December 31,
2002 2001
Current Assets
Cash and cash equivalents $44,554 $140,744
Accounts receivable from customers
and other 408,074 379,161
Deposit receivable from FCC 8,494 56,060
Materials and supplies, at average
cost, and other current assets 79,128 98,391
540,250 674,356
Investments
Cellular license costs, net 877,195 858,791 *
Goodwill, net 912,206 870,801 *
Marketable equity securities 1,508,310 2,700,230
Investments in unconsolidated
entities 245,057 233,678
Notes Receivable 107,711 101,887
Other
investments 15,226 15,079
3,665,705 4,780,466
Property, Plant and Equipment,
net
U.S. Cellular 1,637,741 1,527,805
TDS Telecom 1,027,229 1,016,634
2,664,970 2,544,439
Other Assets and
Deferred Charges 88,750 80,313
$6,959,675 $8,079,574
* Restated to conform to current year presentation.
TELEPHONE AND DATA SYSTEMS, INC.
CONSOLIDATED BALANCE SHEET HIGHLIGHTS
(Unaudited, dollars in thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
June 30, December 31,
2002 2001
Current Liabilities
Current portion of long-
term debt $20,540 $67,461
Notes payable 16,900 265,300
Accounts payable 244,918 270,005
Advance billings and customer
deposits 78,984 68,044
Accrued interest 29,207 24,264
Accrued taxes 47,397 14,263
Accrued compensation 44,372 56,973
Other current liabilities 46,082 49,906
528,400 816,216
Deferred
Liabilities and Credits 1,057,172 1,461,530 *
Long-term Debt, excluding
current portion 1,685,906 1,507,764
Minority Interest 477,582 467,698
Company-Obligated Mandatorily
Redeemable Preferred Securities of
Subsidiary Trust Holding Solely Company
Subordinated Debentures 300,000 300,000
Preferred Shares 6,984 7,442
Common Stockholders' Equity
Common Shares, $.01 par value 558 557
Series A Common Shares, $.01 par value 66 68
Capital in excess of par value 1,829,344 1,826,840
Treasury Shares (404,887) (406,894)
Accumulated other comprehensive income (20,410) (352,120)
Retained earnings 1,498,960 2,450,473
$6,959,675 $8,079,574
* Restated to conform to current year presentation.
BALANCE SHEET HIGHLIGHTS
JUNE 30, 2002
(Unaudited, dollars in thousands)
TDS
U.S. TDS Corporate
Cellular Telecom & Other
Cash and Cash Equivalents $9,135 $32,490 $2,929
Affiliated Cash Investments 9,109 564,021 ---
Notes Receivable--Affiliates --- --- 401,196
$18,244 $596,511 $404,125
Cellular License and Goodwill, net $1,351,170 $439,592 $---
Marketable Equity Securities 157,235 38,372 1,312,703
Investment in Unconsolidated Entities 170,929 48,931 25,197
Notes Receivable 53,017 --- 54,694
Other Investments --- 15,226 ---
$1,732,351 $542,121 $1,392,594
Property, Plant and
Equipment, net $1,637,741 $1,027,229 $---
Notes Payable: external $15,000 $--- $1,900
cash management --- --- 573,130
intercompany --- 401,196 ---
$15,000 $401,196 $575,030
Long-term Debt:
Current Portion $--- $17,464 $3,076
Non-current Portion 567,236 273,414 845,256
Total $567,236 $290,878 $848,332
Trust Originated Preferred Securities $--- $--- $300,000
Preferred Shares $--- $--- $6,984
Total Outstanding Debt and
Preferred Shares $582,236 $692,074 $1,730,346
Construction Expenditures:
Quarter Ended 6/30/02 $156,699 $42,259
Six Months Ended 6/30/02 $256,774 $70,512
BALANCE SHEET HIGHLIGHTS
JUNE 30, 2002
(Unaudited, dollars in thousands)
Intercompany TDS
Eliminations Consolidated
Cash and Cash Equivalents $--- $44,554
Affiliated Cash Investments (573,130) ---
Notes Receivable--Affiliates (401,196) ---
$(974,326) $44,554
Cellular License and Goodwill, net $(1,361) $1,789,401
Marketable Equity Securities --- 1,508,310
Investment in Unconsolidated Entities --- 245,057
Notes Receivable --- 107,711
Other Investments --- 15,226
$(1,361) $3,665,705
Property, Plant and
Equipment, net $--- $2,664,970
Notes Payable: external $--- $16,900
cash management (573,130) ---
intercompany (401,196) ---
$(974,326) $16,900
Long-term Debt:
Current Portion $--- $20,540
Non-current Portion --- 1,685,906
Total $--- $1,706,446
Trust Originated Preferred Securities $--- $300,000
Preferred Shares $--- $6,984
Total Outstanding Debt and
Preferred Shares $(974,326) $2,030,330
Construction Expenditures:
Quarter Ended 6/30/02 $198,958
Six Months Ended 6/30/02 $327,286
TDS Telecom Highlights
Three Months Ended June 30,
(Unaudited, dollars in thousands)
Increase
(Decrease)
2002 2001 Amount Percent
Local Telephone Operations
Operating Revenues
Local Service $47,432 $43,626 $3,806 8.7%
Network Access and Long-
Distance 85,885 77,475 8,410 10.9%
Miscellaneous 21,734 17,616 4,118 23.4%
155,051 138,717 16,334 11.8%
Operating Expenses
Network Operations 33,997 28,792 5,205 18.1%
Customer Operations 22,435 21,441 994 4.6%
Corporate Expenses 21,585 18,755 2,830 15.1%
78,017 68,988 9,029 13.1%
Operating Cash Flow 77,034 69,729 7,305 10.5%
Depreciation and Amortization
Depreciation 31,541 30,745 796 2.6%
Amortization 506 1,827 (1,321) (72.3%)
32,047 32,572 (525) (1.6%)
Operating Income 44,987 37,157 7,830 21.1%
TDS Metrocom Operations
Revenues 27,848 15,742 12,106 76.9%
Expenses before Depreciation 36,381 21,177 15,204 71.8%
Operating Cash Flow (8,533) (5,435) (3,098) (57.0%)
Depreciation 6,362 2,959 3,403 115.0%
Operating (Loss) (14,895) (8,394) (6,501) (77.4%)
USLink Operations
Revenues 13,914 12,888 1,026 8.0%
Expenses before Depreciation and
Amortization 13,169 12,266 903 7.4%
Operating Cash Flow 745 622 123 19.8%
Depreciation and Amortization 818 768 50 6.5%
Operating Income (73) (146) 73 (50.0%)
Intercompany Revenues (709) (335) (374) N/M
Intercompany Expenses (709) (335) (374) N/M
--- --- --- N/M
Total TDS Telecom Operating Income $30,019 $28,617 $1,402 4.9%
N/M - Percentage change not meaningful.
TDS Telecom Highlights
Six Months Ended June 30,
(Unaudited, dollars in thousands)
Increase
(Decrease)
2002 2001 Amount Percent
Local Telephone Operations
Operating Revenues
Local Service $94,275 $86,752 $7,523 8.7%
Network Access and Long-
Distance 168,969 152,078 16,891 11.1%
Miscellaneous 41,328 34,331 6,997 20.4%
304,572 273,161 31,411 11.5%
Operating Expenses
Network Operations 65,694 54,676 11,018 20.2%
Customer Operations 44,005 41,103 2,902 7.1%
Corporate Expenses 44,867 37,472 7,395 19.7%
154,566 133,251 21,315 16.0%
Operating Cash Flow 150,006 139,910 10,096 7.2%
Depreciation and Amortization
Depreciation 63,489 61,317 2,172 3.5%
Amortization 1,013 3,655 (2,642) (72.3%)
64,502 64,972 (470) (0.7%)
Operating Income 85,504 74,938 10,566 14.1%
TDS Metrocom Operations
Revenues 52,403 29,526 22,877 77.5%
Expenses before Depreciation 69,861 38,412 31,449 81.9%
Operating Cash Flow (17,458) (8,886) (8,572) (96.5%)
Depreciation 12,275 5,463 6,812 124.7%
Operating (Loss) (29,733) (14,349) (15,384) (107.2%)
USLink Operations
Revenues 27,113 25,721 1,392 5.4%
Expenses before Depreciation and
Amortization 25,576 24,224 1,352 5.6%
Operating Cash Flow 1,537 1,497 40 2.7%
Depreciation and Amortization 1,597 1,462 135 9.2%
Operating Income (60) 35 (95) N/M
Intercompany Revenues (1,207) (796) (411) N/M
Intercompany Expenses (1,207) (796) (411) N/M
--- --- --- N/M
Total TDS Telecom Operating Income $55,711 $60,624 $(4,913) (8.1%)
N/M - Percentage change not meaningful.
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SOURCE Telephone and Data Systems, Inc.
Web site: http: //www.teldta.com
CONTACT: Mark A. Steinkrauss, Vice President, Corporate Relations, +1-312-592-5384, mark.steinkrauss@teldta.com , or Julie D. Mathews, Manager, Investor Relations, +1-312-592-5341, julie.mathews@teldta.com , both of Telephone and Data Systems, Inc.
