Rye, NY – August 6, 2020 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) reports financial results for the quarter ending June 30, 2020.

LICT continues to closely monitor developments and is actively taking steps to mitigate the potential risks related to the COVID-19 pandemic to the Company, its teammates and its customers. LICT provides essential voice and data services to its customers. To protect its employees while continuing to provide the essential communications services needed to support remote work and remote learning, the Company adapted installation and repair service processes to limit customer contact and minimize teammate contact with other teammates. In addition, LICT changed technician dispatch procedures to further limit contact and provided personal protective equipment, including masks, gloves and sanitizing products. Technicians are encouraged to evaluate the safety risks of each in-person installation or repair and reschedule the appointment if he or she determines that circumstances at the location present risk. Office-based teammates have been working remotely since the middle of March and, for teammates that work in the Company’s offices, masks and social distancing are required. We thank all of our teammates for their focus on their communities.

At the beginning of the COVID-19 outbreak, LICT companies each responded by:

  • Providing free or discounted services to families to support remote learning;
  • Setting up community Wi-Fi hotspots so community members can stay connected to family, work, and learning;
  • Committing not to disconnect customers that are unable to pay their bills because of the economic effects of the pandemic; and
  • Initiated charitable contributions to support members of our community that have been impacted by the economic fallout from the pandemic. Each of LICT’s 338 teammates have contributed to help schools and local charitable organizations support community members effected by COVID-19.

SHAREHOLDER DESIGNATED CHARITABLE CONTRIBUTION PROGRAM — In 2016, the Company adopted a Shareholder Designated Charitable Contribution Program. Under the Program, all registered shareholders are eligible to designate charities and the Company will a make a contribution to that charity. In 2016 through 2019, the Company made $100 per share contributions on behalf of its shareholders to their designated charities. In addition, during the  Second Quarter of 2020 (y)our teammates designated $247,000 to local schools and various charitable organizations within our local communities to support them in dealing with the challenges presented by the Covid-19 pandemic.

SECOND QUARTER RESULTS – In 2020, LICT’s second quarter revenues were $30.5 million compared to $30.9 million for the corresponding quarter in 2019. EBITDA was $13.8 million in the second quarter of 2020 as compared to $15.2 million in the second quarter of 2019.   

Non-regulated revenues gained 11.0%, to $15.0 million from the prior year’s $13.5 million resulting from increased sales of broadband and competitive local exchange carrier (“CLEC”) revenues. Non-regulated EBITDA rose 14.1% to $6.5 million, from $5.7 million. Regulated revenues were $15.5 million in the second quarter of 2020 from the prior year’s recorded $17.4 million, which included an incremental $1.1 million for A-CAM. Regulated EBITDA was $7.3 million compared to $9.6 million last year which included $1.1 million of incremental


EARNINGS PER SHARE – Diluted earnings per share from on-going operations during the second quarter were $307 per share in 2020 as compared to $391 per sharein 2019. The $84 per share decline was primarily related to a non-recurring incremental A-CAM revenue in the second quarter of 2019. The following table provides a reconciliation of the change in earnings per share:

Category:Tax affected EPS impact:
Incremental A-CAM$44
Equity in earnings of affiliated companies (Modoc)  26
Charitable Contributions  10
Reductions in other Regulated Revenues   4
Total EPS change$84

Shares outstanding at June 30, 2020 were 18,719 versus 19,188 at December 31, 2019.

ALTERNATIVE – CONNECT AMERICA COST MODEL (“A-CAM”) PROGRAM – Effective January 1, 2017, ten of LICT’s rural telephone companies elected to participate in the Federal Communications Commission’s (“FCC”) A-CAM program. The A-CAM program is designed to increase speed and expand the deployment of broadband capabilities throughout the nation’s rural areas and replaced two prior Universal Service Fund (“USF”) mechanisms for companies electing A-CAM. On February 25, 2019, the FCC further expanded the A-CAM program for those companies whose support was initially capped and offered LICT companies an additional $4.6 million in annual A-CAM funding, retroactive to January 1, 2019. With this latest increase, these capped companies have now been offered the fully funded support contemplated by the initial A-CAM program.  In addition, the FCC extended the A-CAM annual support payments, for all A-CAM companies, capped and uncapped, for two additional years to December 31, 2028.  Acceptance of these additional years requires the companies to provide a higher threshold of speed to a greater number of locations.  The Company’s subsidiaries have accepted this A-CAM expansion program and are building out and upgrading their networks to meet the additional requirements.

On May 2, 2019, the FCC further expanded the A-CAM program, referred to as A-CAM II, to companies still receiving legacy USF support, HCLS and ICLS, in their service territories. LICT’s two Wisconsin companies elected to participate and received $1.1 million in annual A-CAM II funding for the full year ending December 31, 2019.  The Company’s subsidiaries received the 2019 year to date incremental funding in the 3rd quarter of 2019. As of 2019, all of LICT’s rural telephone companies have elected A-CAM or A-CAM II regulation and all will receive the support through 2028. A-CAM and A-CAM II revenues were $32.3 million in 2019.

2020 OUTLOOK – Economic conditions in our service areas demand for broadband services remain robust and, as a result, LICT is maintaining its guidance for 2020. The Company expects to continue its strong financial performance in 2020 with total revenues of $120 – $124 million, EBITDA in the range of $54 to $56 million, and total capital expenditures between $25 and $27 million. The effect of the COVID-19 pandemic may impact non-regulated revenue growth and potentially impact bad debt expense as the economic contraction may impair customers’ ability to purchase and pay for service.

GROWING THE COMPANY – The Board of Directors and management have implemented measures which have improved liquidity and reduced the Company’s debt position. 

FCC SPECTRUM AUCTIONS – The Company has applied to participate in two FCC auctions in 2020: Auction 105 – CBRS band and Auction 904 also known as Rural Development Opportunity Fund or RDOF.  Auction 105, for which our application has been accepted, began on July 23, 2020 and is ongoing. Auction 904 is a reverse auction to receive funding as part of the Federal Communications Commission’s Universal Service Fund. The objective of Auction 904 is to provide funding for the expansion of broadband internet services to underserved rural areas of the United States. Bidding in Auction 904 is anticipated to begin on October 29, 2020.

These auctions cover areas within LICT’s service areas providing LICT with opportunities to bring broadband to underserved rural communities within and outside of our subsidiaries’ operations.

CAPITAL EXPENDITURES – In the second quarter of 2020, capital expenditures were $7.8 million, of which $4.8 million was for non-regulated activities and $3.1 million for regulated activities. In order to expand the Company’s fiber initiatives and provide a high level of broadband to our customers, our current plan calls for capital expenditures of $25 million – $27 million in 2020. This capital investment enables us to offer enhanced broadband speeds and will increase the overall fiber route miles in our network.

As of June 30, 2020, LICT operations deployed 5,019 miles of fiber optic cable, 11,470 miles of copper cable, and 752 miles of coaxial cable.

SHARE REPURCHASES – During the six months ended June 30, 2020, the Company repurchased 469 shares for $7.7 million, with an average price of $16,470 per share.  As of June 30, 2020, 18,719 shares were outstanding. 

OPERATING STATISTICS – As of June 30, 2020, the Company’s broadband penetration in its franchised telephone service territories, based on its total Incumbent Local Exchange Carrier (“ILEC”) voice lines, was 84.4%, as compared to 82.2% at December 31, 2019.

Our summary operating statistics are as follows:

 June 30,December 31, Percent
Broadband lines            34,61933,2721,3474.0%
Voice Lines    
  Total32,25232,045207 0.6%
Video Subscribers4,5094,628(119)(2.6%)
Revenue Generating Units71,38069,9451,4352.1%


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.  Such forward-looking 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

                                                                                                               LICT CORPORATIONExhibit A
Statements of Operations and Balance Sheet DataPage 1 of 2
(In Thousands, Except Per Share Data)
 Three Months Ended         Six Months Ended
June 30,June 30,
20202019 20202019
Cost and Expenses:    
Cost of revenue, excluding depreciation13,35012,57026,74825,149
Selling, general and administration3,1763,0726,2755,889
Corporate Office Expenses1,0631,127 2,0132,149
Charitable Contributions247 247
Depreciation and amortization4,0744,5008,4149,379
Total Costs and Expenses22,11021,26943,69742,566
Operating profit        8,3979,596 16,85616,482
Other Income (Expense)    
Investment income15468267242
Interest expense(486)(386)(788)(818)
Equity in earnings of affiliated companies664531,167
Income Before Income Tax Provision8,0909.94529,45519,569
Provision for Income Taxes(2,323)(2,300)(7,877)(4,849)
     Income from continuing operations5,7677,645 21,57814,720
Income from discontinued operations before taxes71 110
Provision for income taxes(5) (15)
Income from discontinued operations after taxes66 95
     Net Income$ 5,767$7,711$21,578$14,815
  Capital Expenditures$7,842$6,654$12,899$11,501
Weighted Average Shares:    
Basic18,59319,581 18,59319,672
Actual shares outstanding at end of period18,71919,54418,71919,544
Earnings Per Share: **     
Basic Net Income$307$391 $1,139$748
Dilutive Earnings Per Share$307$390 $1,139$747
** Please note that operating results include cash received from the partial proceeds from the sale of assets by a minority position owned by the Company, $2.5 million in the first quarter of 2019. These proceeds are included in other income-other, on the Income Statement above. The after-tax impact of this item on earnings per share for first half of 2019 is approximately $93 per share. The gain of $13.1 million stemming from the sale of MODOC added $504 of earnings per share in the first half of 2020.
See EBITDA on page 2     

LICT Corporation                                                                                                                                            Exhibit A                                                                                                    Statements of Operations and Selected Balance Sheet Data-Continued                                  Page 2 of 2  (In Thousands, Except Per Share Data)
Cash and Cash Equivalents$84,544$8,415 
Other short-term investments2,00020,000   
Long-Term Debt (including current portion)63,11724,678 
  Liabilities, including taxes, other than debt$42,463$35,386 
Shareholders’ Equity$168,199$154,345 
Shares Outstanding at Date18,71919,188 
EBITDA is an established measure of operating performance and liquidity that is commonly reported and widely used by analysts, investors, and other interested parties in the telecommunications industry because it eliminates many differences in financial, capitalization, and tax structures, as well as non-cash and non-operating charges to earnings. We believe that EBITDA trends are a valuable indicator of whether our operations are able to produce sufficient operating cash flow to fund working capital needs, service debt obligations, and fund capital expenditures.
EBITDA equals net income (loss), before interest expense, income tax expense (benefit), depreciation and amortization expense, investment income, equity in earnings of affiliated companies, gain (loss) on sale of investment, impairment charges, and net income from discontinued operations. EBITDA also now includes the cash distributions we receive from the equity in earnings of affiliated companies.  Although we do not have majority voting control of such companies, we have the ability to significantly influence financial and accounting policies. The inclusion of cash received from equity companies is a change from past practice.
 Three Months EndedSix Months Ended
June 30,June 30,
Operating subsidiaries$13,781$15,224$27,529$28,010
Cash received from equity affiliates562 5421,125
    On-going operating subsidiaries 13,78115,786 28,07129,135
    Charitable Contributions(247) (247)
Corporate Office Expense(1,063)(1,127) (2,013)(2,149)
Depreciation and amortization(4,074)(4,500)(8,414)(9,379)
Deduct cash received from equity affiliates(562)(542)(1,125)
Operating profit$8,397$9,596$16,85616,482