ANCHORAGE -- Alaska Communications Systems Group on Monday reported financial results for the third quarter of 2018.
"Our results for the quarter and year to date are strong, reflecting solid execution to our plan. Our performance builds on a long-term track record of revenue growth and cost management supporting consistent Adjusted EBITDA and Adjusted Free Cash Flow performance. Looking forward, we see growing opportunities in Carrier & Federal, Education, and Oil & Gas, with the added tailwinds of an improving Alaska economy," said Anand Vadapalli, president and CEO of Alaska Communications.
“Historically our capital allocation strategies have prioritized deleveraging, establishing the foundation for future growth. We continue to see material opportunities in the market, giving us great confidence in investing for growth. At the same time, given the strength of our balance sheet, we are committed to appropriately considering returns to our shareholders as part of our organic business plan, while we continue to emphasize strategic actions addressing scale and geographic diversification to amplify and accelerate value creation,” Vadapalli added.
Revenue Highlights: Q3 2018 vs. Q3 2017
Revenue was $58.2 million, compared to $56.7 million
Total broadband revenue was $31.2 million, compared to $31.3 million
Business and Wholesale:
Comprised 62.5% of total revenue
Revenue was $36.4 million, compared to $34.9 million
Broadband revenue was $24.7 million, compared to $25 million.
Comprised 15.9 % of total revenue
Revenue was $9.3 million in both periods
Broadband revenue was $6.5 million, compared to $6.3 million.
Comprised 21.6% of total revenue
Revenue was $12.6 million, compared to $12.5 million
Financial Metrics: 3Q 2018 vs. 3Q 2017
Operating income was $5.8 million, compared to $3.7 million
Net income was $1.8 million, compared to $0.3 million
Net cash provided by operating activities was $24.5 million, compared to $8.6 million
Capital expenditures were $8.4 million, compared to $13.5 million
Balance Sheet Metrics: Sept. 30, 2018 vs. Dec. 31, 2017
Cash and cash equivalents was $18.9 million, compared to $16.2 million
Net debt was $159.1 million, compared to $177.2 million.
Non-GAAP Metrics: 3Q 2018 vs. 3Q 2017
Adjusted EBITDA was $14.8 million, compared to $13.2 million
Adjusted free cash flow was $2.4 million, compared to $4.1 million.
Reconciliations of non-GAAP financial measures to GAAP financial measures can be found in tables at the end of this release.
"During the third quarter, we received cash payments of $14.5 million associated with the Rural Health Care program, which contributed to the $24.5 million in net cash provided by operating activities," said Laurie Butcher, Alaska Communications senior vice president of finance. "Reflecting the growth opportunities ahead of us, we are modestly increasing our guidance for capital expenditures while reaffirming guidance on all other fronts."
The company reaffirms and amends guidance as follows:
Total Revenue between $225 million and $230 million is reaffirmed
Adjusted EBITDA between $55 million and $58 million is reaffirmed
Capital Expenditures between $37 million and $39 million is increased from $33 million to $35 million
Adjusted Free Cash Flow between $5 million and $8 million is reaffirmed.
Conference Call Nov. 6, 2pm ET
The Company will host a conference call and live webcast today -- Tuesday, Nov. 6, 2018 at 2:00 p.m. Eastern Time -- to discuss the results. Parties in the United States and Canada can access the call at 1-888-378-4398 and enter pass code 279107. All other parties can access the call at 1-856-344-9295 and use the same code. There will be a live question and answer session after the prepared remarks.
The live webcast of the conference call will be accessible from the "Events Calendar" section of the ocompany's website. The webcast will be archived for 90 days. A telephonic replay of the conference call will also be available two hours after the call and will run until December 6, 2018 at 5:00 p.m. Eastern. To hear the replay, from the U.S. and Canada call 1-888-203-1112 and enter pass code 8100091. All other parties can call 1-719-457-0820 and enter pass code 8100091.
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