– Non-Regulated Revenues Report Record Results
– Shareholder Designated Contribution Program -$100. per share
Rye, NY – November 12, 2021 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) reports unaudited, financial results for the quarter ended September 30, 2021.
RESULTS-
Driven by broadband services, third quarter non-regulated revenues increased 9%, to a record $17.1 million from the prior year’s third quarter $15.6 million. Non-regulated EBITDA rose over 9% to $7.3 million, from $6.7 million.
Regulated revenues on the other hand slipped to $15.2 million from last year’s third quarter revenues of $16.5. This shortfall is traceable to a reduction from DSL detariffing and a cost study revision associated with network changes. Last year’s third quarter included a non-recurring receivable of $0.6 million driven by changes in the computation of the cost recovery mechanism. Regulated EBITDA was $7.4 million compared to $8.8 million last year.
Overall revenues in LICT’s third quarter were $32.3 million compared to $32.2 million for the corresponding quarter in 2020. EBITDA was $14.7 million in the third quarter of 2021 as compared to $15.5 million in 2020.
OTHER EXPENSES – A decline in other expenses to $300,000 from $500,000 was mostly due to a decrease in interest expense reflecting payment of a large portion of the $50 million loan from CoBank in 2020.
EARNINGS PER SHARE – Earnings per share from operations for the third quarter of 2021 were $342 per share for the third quarter as compared to $371 per sharein the prior year’s third quarter. LICT’s guidance, for 2021 revenue and EBITDA, remains unchanged with revenues of $127 – $131 million and EBITDA in the range of $58 to $60 million.
Full year we expect earnings per share to be $1,435 per share versus $1,353 in 2020. Shares outstanding at the end of the third quarter of 2021 were 17,960.
FCC AUCTIONS – LICT is currently participating in Auction 110. During the third quarter of 2021, we continued our efforts to deploy the spectrum licenses we were awarded in various auctions which will enable us to provide increases speeds to some of our more remote customers. In addition, we are engaged in the filing process required by the FCC for the markets we were awarded in Auction 904, the Rural Digital Opportunities Fund auction.
STRATEGIC REVIEW – As previously stated, the Company continues to systematically seek, analyze and evaluate a full range of means to expand the scope and scale of its businesses to accelerate growth across all of them, and thereby enhance our shareholders’ value.
CAPITAL EXPENDITURES – In the third quarter of 2021, capital expenditures increased by $1.7 million to $8.1 million, of which $3.5 million was for non-regulated activities and $4.6 million for regulated activities. LICT’s guidance on capital expenditures is increasing to a range of $31 and $33 million this year from $28 million invested in 2020 as we have increased deployment of fiber in the communities we serve. Our capital spending enables us to meet and exceed our A-CAM requirements, by accelerating our broadband deployment, offering enhanced broadband speeds, and increase the overall fiber route miles in our network.
As of September, 30, 2021, LICT owns and operates 5,411 miles of fiber optic cable, 11,499 miles of copper cable, 775 miles of cable and 83 towers.
SHARE REPURCHASES – During the nine months ended September 30, 2021, the Company repurchased 573 shares for $12.9 million, with an average price of $22,600 per share. On September 30, 2021, 17,960 shares were outstanding, with 914 shares still available for authorized repurchase mostly on an opportunistic basis.
SHAREHOLDER CONTRIBUTION PROGRAM – LICT’s Board of Directors has approved $100 per share for this year’s Shareholder Designated Charitable Contribution Program. For the past 6 years LICT has extended to registered shareholders, the opportunity to designate a 501(c) 3 charity to which LICT will contribute $100. per share. Details regarding the program will be issued under separate cover.
OPERATING STATISTICS / BROADBAND DEPLOYMENT – As of September 30, 2021, the Company’s broadband penetration in its franchised telephone service territories, based on its total Incumbent Local Exchange Carrier (“ILEC”) voice lines, was 93.3%, as compared to 90.8% at December 31, 2020.
| September 30, | December 31, | Percent | |||
| Increase | Increase | ||||
| 2021 | 2020 | (Decrease) | (Decrease) | ||
| Broadband lines | 43,480 | 39,825 | 3,655 | 9.2% | |
| Voice Lines | |||||
| ILEC | 23,896 | 24,005 | (109) | (0.5%) | |
| Out of franchise | 6,919 | 7,456 | (537) | (7.2%) | |
| Total | 30,815 | 31,461 | (646) | (2.1%) | |
| Video Subscribers | 4,179 | 4,406 | (227) | (5.2%) | |
| Revenue Generating Units | 78,474 | 75,692 | 2,782 | 3.7% | |
*****************************************************************************************************************************
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, www.lictcorp.com. 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 http://www.lictcorp.com.
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LICT CORPORATION |
Exhibit A |
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Statements of Operations and Selected Balance Sheet Data |
Page 1 of 2 |
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(In Thousands, Except Per Share Data) |
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STATEMENTS OF OPERATIONS |
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Three Months Ended |
Nine Months Ended |
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September 30, |
September 30, |
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2021 |
2020 |
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2021 |
2020 |
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Revenues |
$32,314 |
$32,183 |
$96,616 |
$92,736 |
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Cost and Expenses: |
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Cost of revenue, excluding depreciation |
14,624 |
13,739 |
43,622 |
40,487 |
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Selling, general and administration |
2,960 |
2,911 |
9,149 |
9,186 |
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Corporate Office Expenses |
880 |
1,207 |
2,743 |
3,220 |
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Charitable Contributions |
— |
— |
183 |
247 |
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Depreciation and amortization |
4,919 |
4,453 |
14,210 |
12,867 |
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Total Costs and Expenses |
23,383 |
22,310 |
69,907 |
66,007 |
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Operating profit |
8,931 |
9,873 |
26,709 |
26,729 |
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Other Income (Expense) |
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Investment income |
7 |
16 |
791 |
283 |
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Interest expense |
(277) |
(481) |
(981) |
(1,269) |
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Equity in earnings of affiliated companies |
29 |
— |
235 |
53 |
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Gain from the sale of investment (a) |
— |
— |
— |
13,071 |
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Other |
(31) |
16 |
5 |
12 |
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(272) |
(449) |
50 |
12,150 |
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Income Before Income Tax Provision |
8,659 |
9,424 |
26,759 |
38,879 |
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Provision for income taxes |
(2,497) |
(2,481) |
(7,337) |
(10,358) |
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Net Income |
$6,162 |
$6,943 |
$19,422 |
$28,521 |
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Capital Expenditures |
$8,132 |
$6,460 |
$22,763 |
$19,348 |
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Weighted Average Shares- Basic and Diluted |
18,026 |
18,701 |
18,214 |
18,866 |
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Actual shares outstanding at end of period |
17,960 |
18,673 |
17,960 |
18,673 |
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Earnings Per Share: |
$342 |
$371 |
$1,066 |
$1,512 |
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Earnings Per Share excluding the gain from the sale of an investment(a) |
$342 |
$371 |
$1,066 |
$1,002 |
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(a) Please note for the nine months ended September 30, 2020, includes the gain of $13.1 million stemming from the sale of MODOC which added $510 to earnings per share.
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See EBITDA on page 2 |
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LICT Corporation Exhibit A Statements of Operations and Selected Balance Sheet Data-Continued Page 2 of 2 (In Thousands, Except Per Share Data) |
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SELECTED BALANCE SHEET DATA |
September 30, |
December 31, |
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2021 |
2020 |
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Cash and Cash Equivalents |
$42,738 |
$67,324 |
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Other short-term investments |
$20,000 |
$20,000 |
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Long-Term Debt (including current portion) |
$(47,325) |
$(63,176) |
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Net Cash |
$15,413 |
$24,148 |
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Shareholders’ Equity |
$187,047 |
$180,595 |
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Shares Outstanding |
17,960 |
18,533 |
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EBITDA |
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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. We believe that EBITDA trends are a valuable indicator of whether our operations can produce sufficient operating cash flow to fund working capital needs, service debt obligations, and fund capital expenditures. |
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EBITDA is calculated as Operating Profit from Continuing Operations plus depreciation and amortization expense and charitable contributions. |
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Three Months Ended |
Nine Months Ended |
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September 30, |
September 30, |
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2021 |
2020 |
2021 |
2020 |
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EBITDA Reconciliation: |
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Operating Profit from Continuing Operations |
$8,931 |
$9,873 |
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$26,709 |
$26,729 |
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Additions: |
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Corporate expenses |
880 |
1,207 |
2,743 |
3,220 |
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Charitable contributions |
— |
— |
183 |
247 |
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Depreciation and amortization |
4,919 |
4,453 |
14,210 |
12,867 |
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EBITDA from Operations Before Corporate Expenses |
14,730 |
15,533 |
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43,845 |
43,063 |
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Corporate Expenses |
(880) |
(1,207) |
(2,743) |
(3,220) |
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EBITDA |
$13,850 |
$14,326 |
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$41,102 |
$39,843 |
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