- \n
- Revenues increased by 15% to $32.2 million from $28 million.<\/b><\/li>\n
- EBITDA grew 22% to $15.5 million from $12.7 million.<\/b><\/li>\n
- Earnings per share rose to $371 per share versus $263 per share in 2019.<\/b><\/li>\n
- Broadband connections increased by 10% to 39,157 since December 2019 connections of 35,393.<\/b><\/li>\n<\/ul>\n
RYE, N.Y.–(BUSINESS WIRE<\/a>)–
\nLICT Corporation (\u201cLICT\u201d or the \u201cCompany\u201d; OTC Pink\u00ae<\/sup>: LICT) reports financial results for the quarter ending September 30, 2020.\n<\/p>\n\nLICT 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\u2019s offices, masks and social distancing are required. We thank all our teammates for their focus on their communities.\n<\/p>\n
\nSince the COVID-19 outbreak, LICT companies have:\n<\/p>\n
- \n
- \nProvided free or discounted services to families to support remote learning.\n<\/li>\n
- \nSet up community Wi-Fi hotspots so community members can stay connected to family, work, and learning; and\n<\/li>\n
- \nCommitted not to disconnect customers that are unable to pay their bills because of the economic effects of the pandemic.\n<\/li>\n
- \nInitiated charitable contributions to support members of our community that have been impacted by the economic fallout from the pandemic. Each of LICT\u2019s 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.\n<\/li>\n<\/ul>\n
\nSHAREHOLDER DESIGNATED CHARITABLE CONTRIBUTION PROGRAM \u2014 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.\n<\/p>\n
\nTHIRD QUARTER RESULTS \u2013 In 2020, LICT\u2019s 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\u2019s $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.\n<\/p>\n
\nRegulated revenues increased by 18.6% to $16.6 million in the third quarter of 2020 from the prior year\u2019s 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.\n<\/p>\n
\nEARNINGS PER SHARE \u2013 Diluted earnings per share during the third quarter were $371 per share in 2020 as compared to $263 per sharein 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.\n<\/p>\n
\nALTERNATIVE \u2013 CONNECT AMERICA COST MODEL (\u201cA-CAM\u201d) PROGRAM \u2013 All of LICT\u2019s telephone companies have elected to participate in the Federal Communications Commission (\u201cFCC\u2019s\u201d) A-CAM and A-CAM II programs and will receive $32.1 million in 2020 for A-CAM and A-CAM II revenues.\n<\/p>\n
\nThe FCC\u2019s 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 (\u201cUSF\u201d) mechanisms which LICT had been receiving. LICT is actively building and expanding broadband facilities.\n<\/p>\n
\n2020 OUTLOOK \u2013 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\u2019 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\u2019 remote work and distance learning needs.\n<\/p>\n
\nFCC SPECTRUM AUCTIONS \u2013 LICT Wireless Broadband Company, LLC (\u201cLICT Wireless\u201d), a wholly owned subsidiary of the Company, participated in FCC Auction 105 \u2013 CBRS band which ended on August 25, 2020. In this auction the Company acquired $4.6 million of spectrum CBRS band licenses.\n<\/p>\n
\nLICT 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\u2019s 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.\n<\/p>\n
\nCAPITAL EXPENDITURES \u2013 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\u2019s fiber initiatives and provide a high level of broadband to our customers, our plan calls for capital expenditures of $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.\n<\/p>\n
\nAs 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.\n<\/p>\n
\nSHARE REPURCHASES \u2013 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\u2019s approved a 374 increase to the Company\u2019s share repurchase program. That increase brought the number of approved but not yet repurchased shares to 1,000 as of that date.\n<\/p>\n
\nOPERATING STATISTICS \u2013 As of September 30, 2020, the Company\u2019s broadband penetration in its franchised telephone service territories, based on its total Incumbent Local Exchange Carrier (\u201cILEC\u201d) 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.\n<\/p>\n
\nOur summary operating statistics are as follows:\n<\/p>\n
- EBITDA grew 22% to $15.5 million from $12.7 million.<\/b><\/li>\n