LICT Corporation Reports Preliminary Fourth Quarter 2015 Results

Rye, NY – February 8, 2016 – LICT Corporation (“LICT”; OTC Pink®: LICT) reports preliminary, unaudited results for the fourth quarter ended December 31, 2015.

FOURTH QUARTER RESULTS – Revenues increased by $0.5 million, or 2.3%, to $22.3 million compared to the corresponding quarter in 2014. EBITDA before corporate costs was $9.3 million, as compared to $9.4 million in the previous year’s fourth quarter. Allocated Corporate expenses of $188,000 were reported in the fourth quarter of 2014. This figure included several adjustments and the reversal of certain accrued expenses recorded in prior quarters. Unallocated Corporate expenses prior to these adjustments were $450,000 in the fourth quarter of 2015.

Non-regulated revenues grew by 15.6% to $9.6 million from the prior year’s $8.3 million due to increased broadband and competitive local exchange carrier (“CLEC”) revenues. Regulated revenues were $12.6 million in the third quarter of 2015 versus $13.4 million the prior year’s quarter reflecting lower intra-state revenues, primarily at our New Mexico operation, and lower interstate revenues across almost all of our operations which was offset by a favorable out of period adjustment of $0.2 million in 2015.

In November 2015, the Company closed the acquisition of assets and operations of Dixon Telephone Company (“Dixon”) in eastern Iowa by Central Scott Telephone Company, a wholly-owned subsidiary of LICT. Dixon provides broadband data, video, voice and other telecommunications services in areas of eastern Iowa, to four communities that are adjacent to LICT’s Central Scott affiliate.

Earnings during the fourth quarter were $91 per share in 2015 versus $101 per share in 2014, a decrease of 9.9%. Shares outstanding at December 31, 2015, were 21,739 versus 22,272 at December 31, 2014.

FULL YEAR RESULTS – For the year ended December 31, 2015, LICT recorded revenues of $86.6 million and EBITDA, prior to corporate costs but including cash received from our equity affiliates, of $36.4 million. The company is currently estimating that revenues in 2016 will be approximately $88.9 million and EBITDA, prior to corporate costs but including cash received from our equity affiliates, will be approximately $35.6 million.

CAPITAL EXPENDITURES AND DEPRECIATION EXPENSE – In 2015, capital expenditures were $5.7 million for the fourth quarter and $18.0 million for the full year. This reflects our commitment to provide the communities we serve with enhanced communication capabilities and our continued investment in the improvement of our products and in our network infrastructure, particularly our broadband networks. Through upgraded electronics and fiber extensions deeper into our networks, we have improved the speed, the capacity and the reliability of our broadband service offerings.

FCC SPECTRUM AUCTIONS – LICT Wireless Broadband Company, LLC, a wholly owned subsidiary of the Company currently anticipates that it will file an application to participate in Federal Communications Commission (“FCC”) forward auction phase of the broadcast incentive auction (Auction 1002).

BROADBAND REGULATION – The FCC is expected to adopt an Order before the end of March 2016 making significant revisions to their current Universal Service Fund (“USF”) mechanisms. It is anticipated that the Order will require rate-of-return Independent Local Exchange Carriers (“ILECs”) to adopt either a voluntary Alternative Connect America Cost model (“A-CAM”) or accept modifications to the existing Interstate Common Line Support (“ICLS”) and High Cost Loop Support (“HCLS”) cost-based methods for a ten-year period. Due to the uncertainty surrounding these modifications, the Company is unable to precisely predict the impact this will have on LICT’s future revenues at this time our estimates for the full year will be adjusted after we are able to analyze the effects of the Order. However, we believe that government policy will continue to encourage and support communication services in rural areas. There is no certainty that such support will be continued at historical levels. As a result of this, as well as opportunities created from new technologies, including the internet, we have focused on developing non-regulated, high-speed broadband services to supplement our traditional rural telephone services.

STAFF ADDITIONS – In the fourth quarter of 2015, LICT added Jim DaBramo as Chief Operating Officer and Gary Julien as Vice President – Corporate Development. Jim brings vast experience in successfully managing, marketing and selling telecommunications services in competitive arenas. Gary brings a wealth of successful experience in corporate finance, with a particular emphasis on complex mergers and acquisitions. We expect that they will be major contributors to LICT’s ongoing development.

OPERATING STATISTICS – As of December 31, 2015, the Company’s DSL penetration in its franchised telephone service territories, based on total Incumbent Local Exchange Carrier (“ILEC”) voice lines, was 75.0%, compared to 71.6% as of December 31, 2014. Our summary operating statistics are as follows:

 Dec. 31, 2015*Dec. 31, 2014 Increase (Decrease)% Increase (Decrease)
ILEC voice lines27,69028,001(311)(1.1)%
CLEC voice lines5,3535,0193341.2%
Total voice lines33,04333,020230.0%
Broadband lines27,63126,0392,5929.9%
LD Resale lines16,18915,5316584.2%
Video Subscribers6,5706,1174537.4%

* Includes 350 voice lines, 450 broadband lines and 450 video subscribers acquired as part of Dixon acquisition.

BALANCE SHEET – The Company’s net debt, consisting of $14.7 million in cash and $44.8 million in total debt, at December 31, 2015 was $30.1 million as compared to net debt of $36.3 million on December 31, 2014, pro forma for the return of the FCC deposit for Auction 97.

REFINANCING THE COMPANY –The Board of Directors and management have implemented measures which have improved liquidity and reduced the Company’s debt position. At this time, the Board is considering whether the Company should acquire additional leverage which would enable us to explore broader opportunities both within and outside our current industry segments.

SHARE REPURCHASES – During the year ended December 31, 2015, the Company repurchased 622 shares for $3.3 million at an average price of $5,309 per share. As of December 31, 2015, 21,739 shares were outstanding. On February 5, 2016, our Board of Directors authorized the repurchase of an additional 800 shares. The company had exhausted its previous repurchase programs.

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This release contains certain forward-looking information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including without limitation anticipated financial results, financing, capital expenditures and corporate transactions. It should be recognized that such information is based upon certain assumptions, projections and forecasts, including without limitation business conditions and financial markets, regulatory and other approvals, and the cautionary statements set forth in documents filed by LICT on its website, As a result, there can be no assurance that any possible transactions will be accomplished or be successful or that financial targets will be met, and such information is subject to uncertainties, risks and inaccuracies, which could be material.

LICT Corporation is a holding company with subsidiaries in broadband and other telecommunications services that actively seeks acquisitions, principally in its existing business areas.

LICT Corporation is listed on the OTC Pink® under the symbol LICT. For further information visit our website at

Contact: Robert E. Dolan
Executive Vice President and Chief Financial Officer

Release: 16-1

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