LICT CORPORATION REPORTS FIRST QUARTER 2021 RESULTS

  • Revenues increased 6.6% to $32.0 from $30.0 million.
  • EBITDA from operations was $14.3 versus $13.7 million.
  • EPS from operations rose 17% to $378 from $324 per share.

Rye, NY – May 20, 2021 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) reports unaudited, financial results for the quarter ended March 31, 2021.

(Y)our “S” in ESG-

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 2020, the company made $100 per share contribution on behalf of its shareholders to their designated charities. LICT is committed to giving back to our communities and, over the past four years, LICT has made over $6.0 million in charitable contributions.

COVID-19 – LICT continues to closely monitor developments as we begin to see pandemic related restrictions lifted.  The voice and data services we provide are essential to the communities we serve. We will continue to take steps to mitigate the potential risks related to the COVID-19 pandemic to our teammates and customers. 

FIRST QUARTER – In 2021, LICT’s first quarter revenues were $32.0 million compared to $30.0 million for the corresponding quarter in 2020. EBITDA was $14.3 million in the first quarter of 2020 as compared to $13.7 million in 2019.

Non-regulated revenues increased 13%, or $1.9 million, to $16.4 million from the prior year’s first quarter $14.5 million, driven by broadband and cable modem sales. Non-regulated EBITDA rose just over 15% to $7.1 million, from $6.2 million.

Regulated revenues were $15.6 million in the first quarter of 2021 versus the prior year’s first quarter of $15.5 million. Regulated EBITDA was $7.2 million compared to $7.6 million last year. The quarter over quarter decline in EBITDA is predominantly due to expenses related to increased customer installs, maintenance of fiber and additional testing for compliance with A-CAM reporting.

OTHER INCOME – Other income increased by $0.6 million due to an increase of Patronage Capital of $0.3 million related to our $50 million line of credit with CoBank, and $0.3 million investment income from an affiliated company.

EARNINGS PER SHARE Diluted earnings per share from operations for the first quarter of 2021 was $378 per share as compared to $324 per sharein 2020, which excludes the $504 gain per share on the sale of MODOC.

ALTERNATIVE – CONNECT AMERICA COST MODEL (“A-CAM”) PROGRAM –All LICT telephone companies have elected to participate in the FCC’s A-CAM and A-CAM II programs. The A-CAM program is designed to speed and expand the deployment of broadband capabilities throughout the nation’s rural areas and replaced two prior USF mechanisms for companies electing A-CAM. LICT received $8.0 million in the first quarter of 2021 for A-CAM and A-CAM II revenues, as compared to $8.1 million in the first quarter of 2020.

The FCC’s A-CAM program, which commenced January 1, 2017, with revisions in 2018 and 2019, and the addition of A-CAM II in Wisconsin in 2019, is designed to increase broadband speed and expand broadband deployment in rural portions of the country with mandatory build-out requirements for receipt of support. A-CAM and A-CAM II replaced two prior legacy FCC Universal Service Fund (“USF”) mechanisms which LICT had been receiving.  LICT is actively building and expanding broadband facilities. 

EMERGENCY BROADBAND BENEFIT – LICT is actively participating in the Federal Communications Commission’s (“FCC”) $3.2 billion Emergency Broadband Benefit Program to support our ongoing commitment to provide broadband to the rural communities we serve and help close the digital divide.  This program provides consumers who are eligible for a broadband credit of up to $50 per month (up to $75 for households on Tribal Lands) towards their qualifying internet plan for the length of the program and we offer a variety of broadband options that qualify under the Emergency Broadband Benefit program.

BALANCE SHEET – LICT benefited from strong cash from operations in the first quarter of 2021.  In addition, this  reflects  the return of a portion of our FCC deposit of $20 million for Auction 107, as well as the reduction of the borrowings against our line of credit by $30.0 million dollars.  At the end of the first quarter of 2021 our net cash position totaled $22.1 million.

2021 OUTLOOK – LICT’s guidance for 2021 remains unchanged with revenues of $127 – $131 million, EBITDA in the range of $58 to $60 million, and total capital expenditures between $27 and $29 million. We are aware that the effect of the COVID-19 pandemic may impact revenue growth.

FCC SPECTRUM AUCTIONSLICT Wireless Broadband Company, LLC (“LICT Wireless”), a wholly owned subsidiary, participated in FCC Auction 107 – 3.7 GHz band which ended on February 18, 2021.  In this auction, LICT acquired 5 licenses in 5 Partial Economic Areas (PEA) for $4.3 million of spectrum 3.7 GHz band licenses.  In March 2021, the FCC returned $15.7 million which is our $20.0 million original deposit less the $4.3 million in licenses we were highest bidder on.

During the first quarter we continued our efforts to deploy the spectrum licenses we were awarded in Auction 105 of last year which will enable us to reach some of our more remote customers with increased speeds.  In addition, we continue the filing process required by the FCC for the 5 markets we were awarded in the RDOF auction. 

STRATEGIC REVIEW –  As previously announced, LICT has initiated a strategic review to accelerate and broaden the Corporation’s businesses. The actions to be explored will include, among others, the possible creation of a Special Purpose Acquisition Corporation (“SPAC”); the spin-off of one or more of the Corporation’s subsidiaries as a separate entity; potential strategic and accretive acquisitions in the Corporation’s current or adjacent industries; and the possibility of raising additional capital by such means as a rights offering to the Corporation’s existing shareholders.

CAPITAL EXPENDITURES – In the first quarter of 2021, capital expenditures were $7.1 million, of which $4.6 million was for non-regulated activities and $2.5 million for regulated activities. Our capital spending will enable us to meet and exceed our A-CAM requirements, offer enhanced broadband speeds, and increase the overall fiber route miles in our network.

As of March 31, 2021, LICT owns and operates 5,251 miles of fiber optic cable, 11,492 miles of copper cable, 767 miles of coaxial cable and 57 towers.

SHARE REPURCHASES – During the three months ended March 31, 2021, the Company repurchased 134 shares for $2.6 million, with an average price of $19,100 per share. On March 31, 2021, 18,399 shares were outstanding. 

OPERATING STATISTICS / BROADBAND DEPLOYMENT – As of March 31, 2021, the Company’s broadband penetration in its franchised telephone service territories, based on its total Incumbent Local Exchange Carrier (“ILEC”) voice lines, was 91.9%, as compared to 90.8% at December 31, 2020.   During the first quarter the Company’s broadband lines grew by 1.8% to just over 40,500 units, this marginal increase offset our voice and video line loss resulting in an overall growth of 0.4%:

 March 31,December 31, Percent
 IncreaseIncrease
 20212020(Decrease)(Decrease)
Broadband lines            40,55639,8257311.8%
Voice Lines    
ILEC23,73924,005(266)(1.1%)
Out of franchise7,4237,456(33)(0.4%)
  Total31,16231,461(299)(1.0%)
Video Subscribers4,3074,406(99)(2.2%)
Revenue Generating Units76,02575,6923330.4%

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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, 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.

                                                                                                              LICT CORPORATIONExhibit A Page 1 of 2
Statements of Operations and Balance Sheet Data 
(In Thousands, Except Per Share Data) 
 
STATEMENTS OF OPERATIONS 
 Three Months Ended 
March 31, 
20212020  
 
Revenues$32,015$30,046 
   
Cost and Expenses:   
Cost of revenue, excluding depreciation14,47913,198 
Selling, general and administration3,1733,099 
Corporate office expenses946950  
Depreciation and amortization4,6364,340 
Total Costs and Expenses23,23421,587 
     
Operating profit8,7818,459  
     
Other Income (Expense)   
Investment income762113 
Interest expense(385)(302) 
Equity in earnings of affiliated companies18553 
Gain from the sale of investment (a)13,071  
Other58(29) 
62012,906 
   
Income Before Income Tax Provision9,40121,365 
Provision for Income Taxes(2,427)(5,554) 
     Net Income$6,974$15,811 
Capital Expenditures$7,123$4,996 
   
Weighted Average Shares- Basic and Diluted18,45819,101  
Actual shares outstanding at end of period18,39919,008 
     
Earnings Per Share:$378$828  
Earnings Per Share excluding the gain from the sale of an investment(a)$378$324  

(a) Please note the Three Months ended March 31, 2020 includes the gain of $13.1 million stemming from the sale of MODOC which added $504 to earnings per share.

LICT Corporation                                                                                                                                            Exhibit A                                                                                                   

Statements of Operations and Selected Balance Sheet Data-Continued                                  Page 2 of 2  

(in thousands, Except Per Share Data)

    SELECTED BALANCE SHEET DATAMar. 31,Dec. 31,
20212020
   
Cash and Cash Equivalents$55,231$67,324
   
Other short-term investments$          –$20,000
   
Long-Term Debt (including current portion)$33,176$63,176
   
     Net Cash$22,055$24,148
Shareholders’ Equity$184,897$180,595
Shares Outstanding18,39918,533
 Three Months Ended
March 31,
20212020
EBITDA Reconciliation:
Operating Profit from Continuing Operations$ 8,781                 $ 8,459
 Additions:  
    Depreciation and amortization4,6364,340
    Corporate Expenses946950
EBITDA from Operations before Corporate Expenses14,36313,749
Corporate Expenses(946)(950)
EBITDA$ 13,417$ 12,799

LICT Corporation Announces Broad-Ranging Strategic Review

Rye, NY – April 26, 2021 – LICT Corporation (the “Corporation”; OTC Pink®: LICT) is announcing that its Board of Directors (the “Board”) has initiated a strategic review to accelerate and broaden the development of the Corporation’s  businesses.  At a special meeting held on April 23, 2021, the Board directed the consideration and analysis of a full range of measures to unlock current and enhance and surface shareholder value.

The actions to be explored will include, among others, the possible creation of a Special Purpose Acquisition Corporation (“SPAC”); the spin-off of one or more of the Corporation’s subsidiaries as a separate entity; potential strategic and accretive acquisitions in the Corporation’s current or adjacent industries; and the possibility of raising long term debt.

 A SPAC gives the Corporation flexibility to seek out and fund transactions in its existing or related businesses or expand into new areas.

In addition, Shareholders have benefited through spin-offs.  CIBL, Inc., spun off in 2007, initially traded beginning in 2008 at around $200 per share; it has recently traded as high as $1,800 per share.  Likewise, ICTC Group, Inc., spun off in 2010, initially traded at around $15 per share and was acquired in 2018 for $65 per share. Indeed, LICT was itself a spin-off from Lynch Corporation and started at $2,500 per share. LICT is analyzing its current portfolio of companies to determine whether our shareholders might benefit from another such spin-off.

In sum, at the Board’s affirmative direction, the Corporation will 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 to enhance and surface our shareholders’ value.

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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, 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 Shareholder Designated Charitable Contribution Program

Rye, New York- March 2, 2021 – LICT Corporation (OTC Pink: LICT) announces that 8,700 shares are eligible for our Shareholder Charitable Contribution program for all registered shareholders. Each registered shareholder will be eligible to designate a  charity to which the company will make a donation of $100 per share on behalf of the shareholder.

Forms have been mailed to eligible shareholders and must be returned to LICT by March 8, 2021.

LICT’s Board of Directors will make a motion to  repeat the program in 2021.

Only charities that are recognized 501 (c) (3) organizations will be qualified to receive the donation from LICT on the shareholder’s behalf. A list of eligible charities is available at: Guidestar.org

At LICT, we believe charitable giving is a cornerstone of society and an obligation for those with means to make a difference in the world. As an organization, LICT will have no control over the donations, but we are happy to make them on behalf of our shareholders

Over the past 4 years, LICT has made more than $5.5 million in charitable contributions.

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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 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, financial markets 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 successful or that financial or other targets will be met.  Such forward-looking information is subject to uncertainties, risks and inaccuracies, which could be material.

LICT is a holding company with subsidiaries in broadband and other telecommunications services that actively seeks acquisitions, principally in its existing business areas.  LICT is listed on the OTC Pink ® under the symbol LICT.  For further information, please visit our website listed above.

LICT Corporation Reports Preliminary Fourth Quarter And Full Year 2020 Results

Fourth Quarter

  • Revenues increased 1.6% to $31.3 from $30.8 million
  • EPS from operations rose 8% to $325 from $300 per share

 Full Year 

  • Revenues rose $6.1 million or 5.2% to $124.1 from $118 million.
  • EBITDA from operations was $57.6 versus $54.5 million.
  • EPS from operations rose to $1,343 from $1,248 per share.

 (Y)our “S” in ESG- 

SHAREHOLDER DESIGNATED CHARITABLE CONTRIBUTION -The Board of Directors approved in November 2020, a $100. per share, registered shareholder designated charitable contribution. If all shares outstanding are registered in the shareholders’ names at the record date, the total contribution would be approximately $2.2 million. Since the inception of LICT’s program in 2016, and counting this current amount, LICT will have contributed charitable gifts of close to $6.5 million to more than 200 501(c)(3) institutions. 

Rye, NY – February 18, 2021 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) reports preliminary, unaudited, financial results for the year ended December 31, 2020. 

COVID-19 LICT continues to closely monitor developments and is actively taking steps to mitigate the potential risks related to the COVID-19 pandemic to our teammates and our to customers. LICT provides essential voice and data services to the communities we serve. To protect our team while continuing to provide the essential communications services needed to support remote work and remote learning, we adapted installation and repair service processes to limit customer contact and minimize teammate contact. 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 continue to work remotely and, for 

teammates that work in the company’s offices, masks and social distancing are required. We thank all our teammates for their focus on their communities. 

Since the COVID-19 outbreak, LICT has: 

  • Initiated charitable contributions to support members of our community that have been impacted by the economic fallout from the pandemic. Each of LICT’s teammates have contributed to help schools and local charitable organizations support community members effected by COVID-19. 
  • Provided free or discounted services to families to support remote learning. 
  • Set up community Wi-Fi hotspots so community members can stay connected to family, work, and learning 

FOURTH QUARTER – In 2020, LICT’s fourth quarter revenues were $31.3 million compared to $30.8 million for the corresponding quarter in 2019. EBITDA was $14.5 million in the fourth quarter of 2020 and 2019. In addition, we received cash of $0.7 million in 2019 from our equity investment in Modoc which was sold at the beginning of 2020. 

Non-regulated revenues increased by $2.0 million or 14%, to $16.2 million from the prior year’s $14.2 million, of which about $1.2 million resulted from an increase in sales to our broadband offerings and our video cable modem service. The increased demand for broadband speeds from both new customers as well as existing customers increasing speeds, is partially driven by the continued need for both remote learning and remote work. Non-regulated EBITDA rose just over 25% to $7.3 million, from $5.8 million. 

Regulated revenues slipped to $15.1 million in the fourth quarter of 2020 from the prior year’s reported $16.6 million. Regulated EBITDA was $7.2 million compared to $8.8 million last year. The year-to-year decline in regulated revenues and EBITDA is traceable to a fourth quarter 2019 adjustment increasing revenues by $0.8 million related to the cost recovery mechanism reviews. 

In the fourth quarter of 2019, LICT completed the sale of its New Hampshire operation, and is treating the results of the New Hampshire operation as a discontinued operation. Also, in the fourth quarter of 2020, LICT completed the sale of its Topeka AWS spectrum license. 

FULL YEAR RESULTS – Revenues for 2020 were $124.1 million and EBITDA of $57.6 million compared to 2019 revenues of $118.0 million and EBITDA of $54.5. In addition, we received cash of $0.6 million in 2020 versus $2.5 million in 2019, which is included in Exhibit A. 

EARNINGS PER SHARE Diluted earnings per share from operations during the fourth quarter of 2020 were $325 per share as compared to $300 per share in 2019. The full year diluted earnings per share from operations for 2020 was $1,343, which excludes the $512 for the gain on the sale of Modoc Limited Partnership in January 2020, compared to $1,248 at December 31, 2020. Shares outstanding at December 31, 2020 were 18,533 and 19,188 at December 31, 2019. 

ALTERNATIVE – CONNECT AMERICA COST MODEL (“A-CAM”) PROGRAM –All LICT telephone companies have elected to participate in the Federal Communications Commission (“FCC’s”) A-CAM and A-CAM II programs and received $32.1 million in 2020 for A-CAM and A-CAM II revenues. 

The FCC’s A-CAM program, which commenced January 1, 2017, with revisions in 2018 and 2019, and the addition of A-CAM II in Wisconsin in 2019, is designed to increase broadband speed and expand broadband deployment in rural portions of the country with mandatory build-out requirements for receipt of support. A-CAM and A-CAM II replaced two prior legacy FCC Universal Service Fund (“USF”) mechanisms which LICT had been receiving. LICT is actively building and expanding broadband facilities. 

BALANCE SHEET – LICT benefited from strong cash from operations in addition to the proceeds from the MODOC Partnership sale. At 2020 year-end we had a net cash position 0f $24.1 million up from $3.7 million on December 31, 2019. 

2021 OUTLOOK – LICT’s initial guidance for 2021 estimates total revenues of $127 – $131 million, EBITDA in the range of $58 to $60 million, and total capital expenditures between $27 and $29 million. We are aware that the effect of the COVID-19 pandemic may impact non-regulated revenue growth and potentially impact bad debt expense as an economic contraction may impair customers’ ability to purchase and pay for service. 

FCC SPECTRUM AUCTIONS LICT Wireless Broadband Company, LLC (“LICT Wireless”), a wholly owned subsidiary , participated in FCC Auction 105 – CBRS band which ended on August 25, 2020. In this auction, LICT acquired 162 licenses in 78 counties for $4.6 million of spectrum CBRS band licenses. 

In Auction 904, also known as Rural Development Opportunity Fund or “RDOF”, which was held October 29, 2020 to November 23, 2020, LICT was awarded 8 census block groups in 3 states. Auction 904 is a part of the Federal Communications Commission’s Universal Service Fund supporting the expansion of broadband internet services to underserved rural areas of the United States. 

In addition, LICT Wireless is a qualified bidder in Auction 107- C-Band, which is ongoing. 

CAPITAL EXPENDITURES – We continue to focus our capital investments to increase speeds which enables us to better serve our communities for remote work and remote learning, with enhanced broadband speeds through the increase of overall fiber route miles in our network. In the fourth quarter of 2020, capital expenditures were $8.8 million, of which $4.2 million was for non-regulated activities and $4.6 million for regulated activities, bringing our full year capital expenditures to $28.2 million dollars for 2020 compared to $24.9 million in 2019. 

As of December 31, 2020, LICT operations deployed 5,211 miles of fiber optic cable, 11,490 miles of copper cable, 762 miles of coaxial cable and 56 towers. 

SHARE REPURCHASES – During the twelve months ended December 31, 2020, the Company repurchased 655 shares for $11.0 million, with an average price of $16,821 per share. As of December 31, 2020, 18,533 shares were outstanding. 

OPERATING STATISTICS / BROADBAND DEPLOYMENT – As of December 31, 2020, the Company’s broadband penetration in its franchised telephone service territories, based on its total Incumbent Local Exchange Carrier (“ILEC”) voice lines, was 90.8%, as compared to 84.8% at December 31, 2019. The Company’s broadband RGUs grew by 12.5% to just under 40,000 units, outpacing our voice and video line loss resulting in a overall growth of 5.0%. Our capital spending will enable us to meet A-CAM requirements, offer enhanced broadband speeds, and increase the overall fiber route miles in our network. Our summary operating statistics excludes New Hampshire operations, which was sold in 2019, are as follows: 

December 31, 2020December 31, 2019Increase (Decrease)Percent Increase (Decrease)
Broadband lines39,82535,3934,43212.5%
Voice Lines
— ILEC
— Out of franchise

24,005
7,456

24,520
7,525

(515)
(69)

(2.1%)
(0.9%)
Total31,46132,045(584)(1.8%)
Video Subscribers4,4064,628(222)(4.8%)
Revenue Generating Units75,69272,0663,6265.0%

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

LICT Corporation Shareholder Designated Charitable Contribution Program

LICT Corporation (OTC Pink: LICT) announces today that it will continue its Shareholder Charitable Contribution program for all registered shareholders. Each registered shareholder will be eligible to designate a charity to which the company will make a donation of $100 per share on behalf of the shareholder.

At LICT, we believe charitable giving is a cornerstone of society and an obligation for those with means to make a difference in the world. As an organization, LICT will have no control over the donations, but we are happy to make them on behalf of our shareholders.

Over the past 4 years, LICT has made more than $5.5 million in charitable contributions.

If a shareholder’s shares are registered in “street name” (i.e. a bank, broker or other institution holding the shares for the shareholder), those shares will not be eligible to participate in this charitable program. Therefore, any shareholder who has shares that are currently held in street name but wishes to participate in this program should contact the institution holding the shares to arrange for their registration in the shareholder’s own name.

Shareholders will have until February 12, 2021 to register shares in their own name to participate in the program. Our current plan is to distribute, a charitable contribution form that must be returned to LICT no later than March 8, 2021, for the charitable contribution to be made. Only charities that are recognized 501 (c) (3) organizations will be qualified to receive the donation from LICT on the shareholder’s behalf. A list of eligible charities is available at: Guidestar.org

If all shares outstanding are registered in the shareholders’ names at the record date, the total contribution would be approximately $2.2 million.

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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 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, financial markets 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 successful or that financial or other targets will be met. Such forward-looking information is subject to uncertainties, risks and inaccuracies, which could be material.

LICT is a holding company with subsidiaries in broadband and other telecommunications services that actively seeks acquisitions, principally in its existing business areas. LICT is listed on the OTC Pink ® under the symbol LICT. For further information, please visit our website listed above.

LICT CORPORATION REPORTS THIRD QUARTER 2020 RESULTS

  • Revenues increased by 15% to $32.2 million from $28 million.
  • EBITDA grew 22% to $15.5 million from $12.7 million.
  • Earnings per share rose to $371 per share versus $263 per share in 2019.
  • Broadband connections increased by 10% to 39,157 since December 2019 connections of  35,393.

Rye, NY – November  23, 2020 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) reports financial results for the quarter ending September 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. 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 our teammates for their focus on their communities.

Since the COVID-19 outbreak, LICT companies have:

  • 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; and
  • Committing not to disconnect customers that are unable to pay their bills because of the economic effects of the pandemic.
  • 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.  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.

SHAREHOLDER DESIGNATED CHARITABLE CONTRIBUTION PROGRAM — As previously mentioned, 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

THIRD QUARTER RESULTS – In 2020, LICT’s third quarter revenues were $32.2 million compared to $28.0 million for the corresponding quarter in 2019. EBITDA was $15.5 million in the third quarter of 2020 as compared to $12.7 million in the third quarter of 2019. Non-regulated revenues gained 11%, to $15.6 million from the prior year’s $14.0 million resulting from an increase of 7% related to sales of broadband, out of franchise and 3% related to video cable modem revenues. Non-regulated EBITDA rose 15% to $6.8 million, from $5.9 million. 

Regulated revenues increased by 18.6% to $16.6 million in the third quarter of 2020 from the prior year’s recorded $14.0 million. Regulated EBITDA was $8.8 million compared to $6.2 million last year.  The significant increase in regulated revenues and EBITDA was largely related to the accrual to the net revenue reduction in the amount of $1.8 million in the third quarter of 2019 related to the review of the computation under the cost recovery mechanisms,  offset by an incremental $0.6 million for A-CAM 

EARNINGS PER SHARE – Diluted earnings per share during the third quarter were $371 per share in 2020 as compared to $263 per share in 2019, which was crimped by $71 per share  to the net of regulated revenues reduction. Shares outstanding at September 30, 2020 were 18,673, and 19,320 at September 30, 2019 and 19,188 at December 31, 2019. 

ALTERNATIVE – CONNECT AMERICA COST MODEL (“A-CAM”) PROGRAM – All of LICT’s  telephone companies have elected to participate in the Federal Communications Commission (“FCC’s”) A-CAM and A-CAM II programs and will receive $32.1 million in 2020 for A-CAM and A-CAM II revenues. 

The FCC’s A-CAM program, which commenced January 1, 2017, with revisions in 2018 and 2019, and the addition of A-CAM II in Wisconsin in 2019, is designed to increase broadband speed and expand broadband deployment in rural portions of the country with mandatory build-out requirements for receipt of support. A-CAM and A-CAM II replaced two prior legacy FCC Universal Service Fund (“USF”) mechanisms which LICT had been receiving.  LICT is actively building and expanding broadband facilities.  

2020 OUTLOOK – LICT is maintaining its guidance for 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. We are aware that the effect of the COVID-19 pandemic may impact non-regulated revenue growth and potentially impact bad debt expense as an economic contraction may impair customers’ ability to purchase and pay for service. At the same time, we have seen an  increase in the demand for broadband, as we support our communities’  remote work and distance learning needs.

FCC SPECTRUM AUCTIONS – LICT Wireless Broadband Company, LLC (“LICT Wireless”), a wholly owned subsidiary of the Company, participated in FCC Auction 105 – CBRS band which ended on August 25, 2020.  In this auction the Company acquired $4.6 million of spectrum CBRS band licenses.  

LICT is a qualified bidder in Auction 904 also known as Rural Development Opportunity Fund or RDOF which began on October 29, 2020.  Auction 904 is a reverse auction to receive funding as part of the Federal Communications Commission’s Universal Service Fund supporting the expansion of broadband internet services to underserved rural areas of the United States. In addition, LICT Wireless is a qualified bidder for Auction 107 C-Band which is scheduled to begin on December 8, 2020.

CAPITAL EXPENDITURES – In the third quarter of 2020, capital expenditures were $6.4 million, of which $3.3 million was for non-regulated activities and $3.1 million for regulated activities. To expand the Company’s fiber initiatives and provide a high level of broadband to our customers, our plan calls for capital expendituresof $25 – $27 million in 2020. This capital investment enables us to better serve our communities, for remote work and virtual learning with  enhanced broadband speeds through the  increase of overall fiber route miles in our network. 

As of September 30, 2020, LICT operations deployed 5,061 miles of fiber optic cable, 11,478 miles of copper cable, and 757 miles of coaxial cable. 

SHARE REPURCHASES – During the nine months ended September 30, 2020, the Company repurchased 515 shares for $8.5 million, with an average price of $16,588 per share.  As of September 30, 2020, 18,673 shares were outstanding.  On August 5, 2020, LICT Board of Director’s approved a 374 increase to the Company’s share repurchase program. That increase brought the number of approved but not yet repurchased shares to 1,000 as of that date.

OPERATING STATISTICS – As of September 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 89.6%, as compared to 82.4% at December 31, 2019.   During the first nine months of 2020 we have added 3,764 broadband connections bringing our total broadband connections to 39,157.

Our summary operating statistics are as follows:

 September 30,December 31, Percent
 IncreaseIncrease
 20202019(Decrease)(Decrease)
Broadband lines      39,15735,3933,76410.6%
Voice Lines    
ILEC24,49624,520(24)(0.1%)
Out of franchise7,6537,5251281.7%  
  Total32,14932,045104 0.3%
Video Subscribers4,4434,628(185)(4.0%)
Revenue Generating Units75,74972,0663,6835.1%
     

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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, 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.

                                                                                                               LICT CORPORATIONExhibit A
Statements of Operations and Balance Sheet Data Page 1 of 2
(In Thousands, Except Per Share Data)
STATEMENTS OF OPERATIONS
 Three Months Ended         Nine Months Ended
September 30,September 30,
20202019 20202019
  
Revenues$32,183$28,037$92,736$87,145
    
Cost and Expenses:    
Cost of revenue, excluding depreciation13,73913,01640,48738,225
Selling, general and administration2,9112,9439,1868,832
Corporate office expenses1,2071,086 3,2203,235
Charitable contributions 247
Depreciation and amortization4,4534,66912,86714,048
Total Costs and Expenses22,31021,71466,00764,340
      
Operating profit         9,8736,323 26,72922,805
      
Other Income (Expense)    
Investment income1667283309
Interest expense(481)(289)(1,269)(1,107)
Equity in earnings of affiliated companies807531,974
Other16713,0832,503
(449)59212,1503,679
    
Income Before Income Tax Provision9,4246,91538,87926,484
Provision for Income Taxes(2,481)(1,885)(10,358)(6,734)
     Income from continuing operations6,9435,030 28,52119,750
      
Income from discontinued operations before taxes92 202
Provision for income taxes(18) (33)
Income from discontinued operations after taxes74 169
     Net Income$ 6,943$5,104$28,521$19,919
    
 Capital Expenditures$6,433$7,048$19,348$18,587
    
Weighted Average Shares:     
Basic18,70119,388 18,86619,576
Diluted18,70119,42318,86619,611
Actual shares outstanding at end of period18,67319,32018,67319,320
      
Earnings Per Share: **     
Basic  $371$263 $1,512$1,018
Dilutive $371$263 $1,512$1,016
      
** 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 the nine months ended September 30, 2019 is approximately $94 per share. The gain of $13.1 million stemming from the sale of MODOC added $510 of earnings per share for the nine months ended September 30, 2020.


LICT Corporation                                                                                                                                            Exhibit A                                                                                                     Statements of Operations and Selected Balance Sheet Data-Continued                                  Page 2 of 2 (In Thousands, Except Per Share Data)

  SELECTED BALANCE SHEET DATASept 30,Dec. 31, 
20202019 
Cash and cash equivalents and short-term investments$84,313$28,415 
      
Long-Term Debt (including current portion)$63,177$24,678 
 Liabilities, including taxes, other than debt$40,475$35,386 
 
Shareholders’ Equity$174,323$154,345 
 
Shares Outstanding at Date18,67319,188 
 
EBITDA
 Three Months EndedNine Months Ended
September 30,September 30,
2020201920202019
EBITDA   
Operating subsidiaries$15,533$12,078$43,063$40,088
Cash received from equity affiliates662 5421,787
    On-going operating subsidiaries  15,53312,740 43,60541,875
    Charitable Contributions (247)
Corporate Office Expense(1,207)(1,086)  (3,220)(3,235)
EBITDA14,32611,65440,13838,640
Depreciation and amortization(4,453)(4,669)(12,867)(14,048)
Deduct cash received from equity affiliates(662)(542)(1,787)
Operating profit$9,873$6,323$26,729$22,805
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.

LICT CORPORATION COMPLETES SALE OF ITS TOPEKA, KANSAS AWS LICENSE

Rye, NY – November 12, 2020 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) has closed the sale of its 10 MHz AWS Federal Communications Commission (FCC) License in the Topeka, Kansas Basic Trading Area. LICT had announced the signing of a definitive agreement for this transaction on August 14, 2020.

This transaction monetized an FCC license which was a non-core asset of our business. The proceeds from this sale will further strengthen the financial condition and liquidity of LICT.


This release contains certain forward-looking information within the meaning of Section 27A of the Securities Act of 1933, as amended, and 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, financial markets 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 successful or that financial or other targets will be met. Such forward-looking information is subject to uncertainties, risks and inaccuracies, which could be material.
LICT is a holding company with subsidiaries in broadband and other telecommunications services that actively seeks acquisitions, principally in its existing business areas. LICT is listed on the OTC Pink ® under the symbol LICT. For further information, please visit our website listed above.

LICT APPOINTS NEW SENIOR VICE PRESIDENT – BROADBAND ROLE

Rye, New York – October 7, 2020 LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) announces today, that Mr. Matthew Favre, has been appointed to the newly created position  of Senior Vice President- Broadband of LICT as of January 1, 2021.

Mr. Favre will be responsible for the growth and increased development of the Company’s broadband products.

Mr. Favre joined LICT in 2017, serving as President and General Manager of Western New Mexico Telephone Company.

Matt has had a distinguished career in the Cable and Telecommunications industries. Before joining LICT at the Company’s Western New Mexico operation, Matt spent 14 years with Charter Communications including as GM of Georgia/Alabama.

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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 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, financial markets 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 successful or that financial or other targets will be met.  Such forward-looking information is subject to uncertainties, risks and inaccuracies, which could be material.

LICT is a holding company with subsidiaries in broadband and other telecommunications services that actively seeks acquisitions, principally in its existing business areas.  LICT is listed on the OTC Pink ® under the symbol LICT.  For further information, please visit our website listed above.

LICT CORPORATION ANNOUNCES ORGANIZATIONAL CHANGE

Rye, NY – September 3, 2020 – LICT Corporation (“LICT” or the “Company”; OTC Pink®: LICT) is privileged to announce today that Robert E. Dolan has agreed to re-join the Company in an active consulting role overseeing the operations and financial teams while we search for a Chief Operating Officer. Mr. Dolan has served the Company for 29 years in various capacities, including, Chief Executive Officer, Chief Financial Officer and Executive Vice President.  Mr. Dolan will continue to serve on the Company’s Board of Directors.

The Company is also announcing that Daniel E. Hopkins has resigned and will be leaving the Company effective October 2020.  Mr. Hopkins has been serving the Company as President and Chief Financial Officer since November of 2019.

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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 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, financial markets 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 successful or that financial or other targets will be met.  Such forward-looking information is subject to uncertainties, risks and inaccuracies, which could be material.

LICT is a holding company with subsidiaries in broadband and other telecommunications services that actively seeks acquisitions, principally in its existing business areas.  LICT is listed on the OTC Pink ® under the symbol LICT.  For further information, please visit our website listed above.