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Alaska Communications Reports Third Quarter 2019 Results

ANCHORAGE, Alaska--(BUSINESS WIRE)--

  • Revenue Exceeds $59 Million, Led by 7.8% Broadband Growth

  • Bill Bishop Appointed Permanent President & CEO, and Laurie Butcher Named CFO

  • Management Reaffirms 2019 Guidance

Alaska Communications Systems Group, Inc. (ALSK) today reported financial results for the third quarter of 2019.

“We are committed to superior service and network solutions that our customers require in Alaska and the markets we serve in the Lower 48. By emphasizing our customer centric approach, we expect to deliver sustainable long-term growth for our shareholders. For the third quarter, we are pleased to report that we grew total broadband revenue by 7.8% over last year. In addition, we grew net income 11.3% over last year and increased our Adjusted EBITDA margin to 26.7% for the quarter,” said Bill Bishop, President & CEO.

“We are making progress on our deployment of a 5G fiber backhaul network and are on track with provisioning the first route for our 100% prefunded project for one of our strategic customers. In mass market, we grew on-base multi-dwelling units (MDUs) by an additional 2,000 units and added our largest non-military MDU complex to date. We are very excited about our expansion projects and technical capabilities to stay on the forefront of requirements for our advanced products including, our broadband satellite offering, IP voice, and robust data and FiWi networks,” continued Mr. Bishop.

Third Quarter 2019 Compared to Third Quarter 2018

  • Total revenue was $59.1 million, compared to $58.2 million, up 1.5%.

    • Business and wholesale revenue was $38.7 million, compared to $36.4 million, up 6.3%.

    • Consumer revenue was steady at $9.3 million for both periods.

    • Regulatory revenue was $11.1 million, compared to $12.6 million, a decrease of 11.9%, as expected due to the restructuring of the Alaska Universal Service program.

  • Operating expenses were $53.4 million, compared to $52.5 million.

  • Operating income was $5.8 million for both periods.

  • Net income was $2.0 million, compared to $1.8 million.

  • Capital expenditures were $11.1 million, compared to $8.4 million, which includes planned investments to continue our 5G wireless backhaul project.

  • Adjusted EBITDA was $15.8 million, compared to $14.8 million.

  • Adjusted free cash flow was $6.3 million, compared to $4.3 million.

  • Cash was $26.7 million at September 30, 2019, compared to $15.0 million at December 31, 2018.

  • Net debt was $156.6 million at September 30, 2019, compared to $161.2 million at December 31, 2018.

Reconciliations of non-GAAP financial measures to GAAP financial measures can be found in tables at the end of this release and on the Company’s website at http://www.alsk.com in the investment data section.

“As expected, our strong sales funnel translated into significant revenue growth for the quarter in key areas, offsetting the anticipated decline in regulatory revenue. We are committed to maintaining tight financial controls, also contributing to increases in both Adjusted EBITDA and Adjusted Free Cash Flow. In the quarter, we completed a modest stock repurchase of one million shares at an average price of $1.81. Additionally, the Board determined that it was reasonable to discontinue the Section 382 tax preservation plan on October 18, 2019. We will continue to align with our shareholders and consider ways to pursue actions that return capital to shareholders, while staying committed to investing in high ROI projects,” says Laurie Butcher, Chief Financial Officer.

2019 Guidance

The Company reaffirms 2019 guidance.

  • Total Revenue to be between $230 million and $235 million

  • Adjusted EBITDA to be between $60 million and $62 million

  • Capital Expenditures to be between $40 million and $42 million

  • Adjusted Free Cash Flow to be between $10 million and $12 million

Conference Call

The Company will host a conference call and live webcast on Thursday, November 7, 2019 at 2:00 p.m. Eastern Time to discuss the results. Parties in the United States and Canada can access the call at 1-800-367-2403 and enter pass code 8903749. All other parties can access the call at 1-334-777-6978 and use the same code.

The live webcast of the conference call will be accessible from the "Events Calendar" section of the Company's website (www.alsk.com). The webcast will be archived for a period of 30 days. A telephonic replay of the conference call will also be available two hours after the call and will run until December 7, 2019 at 5:00 p.m. Eastern Time. To hear the replay, parties in the U.S. and Canada can call 1-888-203-1112 and enter pass code 8903749. All other parties can call 1-719-457-0820 and enter pass code 8903749.

About Alaska Communications

Alaska Communications (ALSK) is the leading provider of advanced broadband and managed IT services for businesses and consumers in Alaska. The Company operates a highly reliable, advanced statewide data network with the latest technology and the most diverse undersea fiber optic system connecting Alaska to the contiguous U.S. For more information, visit www.alaskacommunications.com or www.alsk.com.

Non-GAAP Measures

In an effort to provide investors with additional information regarding our financial results, we have provided certain non-GAAP financial information, including Adjusted EBITDA, Adjusted Free Cash Flow and Net Debt. Adjusted EBITDA eliminates the effects of period to period changes in costs that are not directly attributable to the underlying performance of the Company’s business operations and is used by Management and the Company’s Board of Directors to evaluate current operating financial performance, analyze and evaluate strategic and operational decisions and better evaluate comparability between periods. Adjusted Free Cash Flow is a non-GAAP liquidity measured used by Management and the Company’s Board of Directors to assess the Company’s ability to generate cash and plan for future operating and capital actions. Adjusted EBITDA and Adjusted Free Cash Flow are common measures utilized by our peers (other telecommunications companies) and we believe they provide useful information to investors and analysts about the Company’s operating results, financial condition and cash flows. Net Debt provides Management and the Company’s Board of Directors with a measure of the Company’s current leverage position. The definition and computation of these non-GAAP measures are provided on Schedules 4, 6 and 9 to this press release. Adjusted EBITDA and Adjusted Free Cash Flow should not be considered a substitute for Net Income, Net Cash Provided by Operating Activities and other measures of financial performance recorded in accordance with GAAP. Reconciliations of our non-GAAP measures to our nearest GAAP measures can be found in the tables in this release. Other companies may not calculate non-GAAP measures in the same manner as Alaska Communications. The Company does not provide reconciliations of guidance for Adjusted EBITDA to Net Income, and Adjusted Free Cash Flow to Net Cash from Operating Activities, in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. The Company does not forecast certain items required to develop the comparable GAAP financial measures. These items are charges and benefits for uncollectible accounts, certain other non-cash expenses, unusual items typically excluded from Adjusted EBITDA and Adjusted Free Cash Flow, and changes in operating assets and liabilities (generally the most significant of these items, representing cash inflows of $8.6 million in the nine-month period of 2019).

Forward-Looking Statements

This press release includes certain "forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's beliefs as well as on a number of assumptions concerning future events made using information currently available to management. Readers are cautioned not to put undue reliance on such forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside the Company’s control. Such factors include, without limitation changes in technology and related standards, the impact of natural or man-made disasters and accidents, Federal and Alaska Universal Service Fund changes and our current and historical compliance with the obligations of those programs, structural declines for voice and other legacy services, maintenance or IT issues, third-party intellectual property claims, potential pension shortfalls, the success or failure of future strategic transactions, funding through the rural health care universal service support mechanism and our ability to comply and our history of compliance with the regulatory requirements to receive those support payments, our ability to service our debt and refinance as required, adverse economic conditions, our success in providing broadband services on the Northslope and Western Alaska, the effects of competition in our markets, our relatively small size compared with our competitors, the Company’s ability to compete, manage, integrate, market, maintain, and attract sufficient customers for its products and services, adverse changes in labor matters, including workforce levels, labor negotiations, employee benefit costs, our ability to control other operating costs, disruption of our supplier’s provisioning of critical products or services, the actions of activist shareholders, changes in Company's relationships with large customers, unforeseen changes in public policies, regulatory changes, our internal control over financial reporting, and changes in accounting standards or policies, which could affect reported financial results. For further information regarding risks and uncertainties associated with the Company’s business, please refer to the Company's SEC filings, including, but not limited to, the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our annual report on Form 10-K and quarterly reports on Form 10-Q. Copies of the Company's SEC filings may be obtained by contacting its investor relations department at (907) 564-7556 or by visiting its investor relations website at www.alsk.com.

Schedule 1

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

CONSOLIDATED SCHEDULE OF OPERATIONS

(Unaudited, In Thousands Except Per Share Amounts)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Operating revenues

$

59,128

$

58,229

$

173,432

$

173,779

Operating expenses:

Cost of services and sales (excluding depreciation and amortization)

26,785

27,220

78,768

79,595

Selling, general & administrative

16,832

16,879

52,206

49,398

Depreciation and amortization

9,546

8,352

27,425

25,336

Loss on disposal of assets, net

198

15

101

56

Total operating expenses

53,361

52,466

158,500

154,385

Operating income

5,767

5,763

14,932

19,394

Other income and (expense):

Interest expense

(2,997

)

(3,286

)

(9,149

)

(10,191

)

Loss on extinguishment of debt

-

-

(2,830

)

-

Interest income

121

36

291

74

Other income, net

192

66

192

79

Total other income and (expense)

(2,684

)

(3,184

)

(11,496

)

(10,038

)

Income before income tax expense

3,083

2,579

3,436

9,356

Income tax expense

(1,084

)

(774

)

(1,228

)

(2,080

)

Net income

1,999

1,805

2,208

7,276

Less net loss attributable to noncontrolling interest

(23

)

(12

)

(76

)

(84

)

Net income attributable to Alaska Communications

$

2,022

$

1,817

$

2,284

$

7,360

Net income per share attributable to Alaska Communications:

Net income applicable to common shares

$

2,022

$

1,817

$

2,284

$

7,360

Basic and Diluted

$

0.04

$

0.03

$

0.04

$

0.14

Weighted average shares outstanding:

Basic

53,328

53,184

53,503

52,994

Diluted

53,991

54,116

54,405

53,887

Schedule 2

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited, In Thousands Except Per Share Amounts)

September 30,

December 31,

Assets

2019

2018

Current assets:

Cash and cash equivalents

$

25,046

$

13,351

Restricted cash

1,631

1,634

Short-term investments

134

134

Accounts receivable, net of allowance of $4,807 and $3,936

25,438

31,472

Materials and supplies

9,185

6,737

Prepayments and other current assets

13,191

12,169

Total current assets

74,625

65,497

Property, plant and equipment

1,414,940

1,390,622

Less: accumulated depreciation and amortization

(1,036,422

)

(1,017,442

)

Property, plant and equipment, net

378,518

373,180

Deferred income taxes

-

498

Operating lease right of use assets

80,748

-

Other assets

12,354

16,010

Total assets

$

546,245

$

455,185

Liabilities and Stockholders' Equity

Current liabilities:

Current portion of long-term obligations

$

5,674

$

2,289

Accounts payable, accrued and other current liabilities

40,317

40,957

Advance billings and customer deposits

3,791

4,024

Operating lease liabilities - current

2,626

-

Total current liabilities

52,408

47,270

Long-term obligations, net of current portion

171,541

168,023

Deferred income taxes

2,823

2,315

Operating lease liabilities - noncurrent

78,362

-

Other long-term liabilities, net of current portion

71,250

67,827

Total liabilities

376,384

285,435

Commitments and contingencies

Alaska Communications stockholders' equity:

Common stock, $.01 par value; 145,000 authorized

540

533

Treasury stock, 1,000 shares at cost

(1,812

)

-

Additional paid in capital

160,931

160,514

Retained earnings

12,723

10,439

Accumulated other comprehensive loss

(3,384

)

(2,675

)

Total Alaska Communications stockholders' equity

168,998

168,811

Noncontrolling interest

863

939

Total stockholders' equity

169,861

169,750

Total liabilities and stockholders' equity

$

546,245

$

455,185

Schedule 3

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited, In Thousands)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Cash Flows from Operating Activities:

Net income

$

1,999

$

1,805

$

2,208

$

7,276

Adjustments to reconcile net income to net cash provided

by operating activities:

Depreciation and amortization

9,546

8,352

27,425

25,336

Loss on disposal of assets, net

198

15

101

56

Amortization of debt issuance costs and debt discount

305

333

911

1,022

Loss on extinguishment of debt

-

-

2,830

-

Amortization of deferred capacity revenue

(1,141

)

(1,067

)

(3,400

)

(2,997

)

Stock-based compensation

277

642

766

1,209

Income tax expense

1,084

774

1,228

2,080

Charge for uncollectible accounts

307

1,279

275

2,371

Amortization of ROU asset

568

-

1,716

-

Other non-cash expense, net

(192

)

(13

)

52

168

Income taxes receivable

(65

)

(1

)

(65

)

(37

)

Changes in operating assets and liabilities

1,401

12,402

8,573

10,395

Net cash provided by operating activities

14,287

24,521

42,620

46,879

Cash Flows from Investing Activities:

Capital expenditures

(11,124

)

(8,351

)

(31,556

)

(25,432

)

Capitalized interest

(374

)

(565

)

(983

)

(1,456

)

Change in unsettled capital expenditures

1,134

(179

)

583

(1,811

)

Proceeds on sale of assets

1

1

20

1

Net cash used by investing activities

(10,363

)

(9,094

)

(31,936

)

(28,698

)

Cash Flows from Financing Activities:

Repayments of long-term debt

(1,135

)

(8,658

)

(172,903

)

(29,164

)

Proceeds from the issuance of long-term debt

-

-

180,000

14,000

Debt issuance costs and discounts

-

-

(2,683

)

-

Cash paid for debt extinguishment

-

-

(1,252

)

-

Cash proceeds from noncontrolling interest

-

-

-

40

Payment of withholding taxes on stock-based compensation

-

-

(448

)

(410

)

Purchases of treasury stock

(1,663

)

-

(1,812

)

-

Proceeds from issuance of common stock

-

-

106

111

Net cash (used) provided by financing activities

(2,798

)

(8,658

)

1,008

(15,423

)

Change in cash, cash equivalents and restricted cash

1,126

6,769

11,692

2,758

Cash, cash equivalents and restricted cash, beginning of period

25,551

12,157

14,985

16,168

Cash, cash equivalents and restricted cash, end of period

$

26,677

$

18,926

$

26,677

$

18,926

Supplemental Cash Flow Data:

Interest paid

$

3,122

$

3,472

$

9,236

$

10,723

Income taxes paid, net

$

-

$

-

$

10

$

4

Schedule 4

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

ADJUSTED EBITDA

(Unaudited, In Thousands)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Net income

$

1,999

$

1,805

$

2,208

$

7,276

Add (subtract):

Interest expense

2,997

3,286

9,149

10,191

Loss on extinguishment of debt

-

-

2,830

-

Interest income

(121

)

(36

)

(291

)

(74

)

Depreciation and amortization

9,546

8,352

27,425

25,336

Other income, net

(192

)

(66

)

(192

)

(79

)

Loss on disposal of assets, net

198

15

101

56

Income tax expense

1,084

774

1,228

2,080

Stock-based compensation

277

642

766

1,209

Cash severance expense

-

-

1,595

-

Net loss attributable to noncontrolling interest

23

12

76

84

Adjusted EBITDA

$

15,811

$

14,784

$

44,895

$

46,079

NonGAAP Measures:

The Company provides certain non-GAAP financial information, including Adjusted EBITDA, Adjusted Free Cash Flow and Net Debt. Adjusted EBITDA eliminates the effects of period to period changes in costs that are not directly attributable to the underlying performance of the Company’s business operations and is used by Management and the Company’s Board of Directors to evaluate current operating financial performance, analyze and evaluate strategic and operational decisions and better evaluate comparability between periods. Adjusted Free Cash Flow is a non-GAAP liquidity measure used by Management to assess the Company’s ability to generate cash and plan for future operating and capital actions. Adjusted EBITDA and Adjusted Free Cash Flow are common measures utilized by our peers (other telecommunications companies) and we believe they provide useful information to investors and analysts about the Company’s operating results, financial condition and cash flows. Net Debt provides Management and the Board of Directors with a measure of the Company’s current leverage position.

The Company does not provide reconciliations of guidance for Adjusted EBITDA to Net Income, and Adjusted Free Cash Flow to Net Cash Provided by Operating Activities, in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. The Company does not forecast certain items required to develop the comparable GAAP financial measures. These items are charges and benefits for uncollectible accounts, certain other non-cash expenses, unusual items typically excluded from Adjusted EBITDA and Adjusted Free Cash Flow, and changes in operating assets and liabilities (generally the most significant of these items, representing cash inflows of $8.6 million in the nine-month period ended September 30, 2019).

Adjusted EBITDA and Adjusted Free Cash Flow are not GAAP measures and should not be considered a substitute for net income, net cash provided by operating activities, or net cash provided or used. Adjusted EBITDA as computed above is not consistent with the definition of Consolidated EBITDA referenced in our 2019 Senior Credit Facility, and other companies may not calculate Non-GAAP measures in the same manner we do.

Adjusted EBITDA is defined as net income (loss) before interest expense and income, loss on extinguishment of debt, depreciation and amortization, other income and expense, gain or loss on asset purchases or disposals, provision for income taxes, stock-based compensation, cash severance expense for the Company's former Chief Executive Officer and net loss attributable to noncontrolling interest.

Schedule 5

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW

(Unaudited, In Thousands)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Net cash provided by operating activities

$

14,287

$

24,521

$

42,620

$

46,879

Adjustments to reconcile net cash provided by operating

activities to adjusted free cash flow:

Capital expenditures

(10,942

)

(8,351

)

(31,374

)

(25,432

)

Capital expenditures for prefunded projects

(182

)

-

(182

)

-

Milestone payments received for prefunded projects

5,285

1,850

5,285

1,850

Amortization of deferred capacity revenue

1,141

1,067

3,400

2,997

Amortization of GCI capacity revenue

(522

)

(522

)

(1,549

)

(1,549

)

Amortization of debt issuance costs and debt discount

(305

)

(333

)

(911

)

(1,022

)

Interest expense

2,997

3,286

9,149

10,191

Interest paid

(3,122

)

(3,472

)

(9,236

)

(10,723

)

Interest income

(121

)

(36

)

(291

)

(74

)

Income taxes receivable

65

1

65

37

Income taxes paid, net

-

-

(10

)

(4

)

Charge for uncollectible accounts

(307

)

(1,279

)

(275

)

(2,371

)

Amortization of ROU asset

(568

)

-

(1,716

)

-

Other income, net

(192

)

(66

)

(192

)

(79

)

Net loss attributable to noncontrolling interest

23

12

76

84

Other non-cash expense, net

192

13

(52

)

(168

)

Changes in operating assets and liabilities

(1,401

)

(12,402

)

(8,573

)

(10,395

)

Adjusted free cash flow

$

6,328

$

4,289

$

6,234

$

10,221

Schedule 6

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

ADJUSTED FREE CASH FLOW

(Unaudited, In Thousands)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Adjusted EBITDA

$

15,811

$

14,784

$

44,895

$

46,079

Less:

Capital expenditures excluding prefunded projects

(10,942

)

(8,351

)

(31,374

)

(25,432

)

Amortization of GCI capacity revenue

(522

)

(522

)

(1,549

)

(1,549

)

Cash severance expense

-

-

(1,595

)

-

Income taxes paid, net

-

-

(10

)

(4

)

Interest paid

(3,122

)

(3,472

)

(9,236

)

(10,723

)

1,225

2,439

1,131

8,371

Impact of prefunded projects:

Capital expenditures for prefunded projects

(182

)

-

(182

)

-

Milestone payments received for prefunded projects

5,285

1,850

5,285

1,850

5,103

1,850

5,103

1,850

Adjusted free cash flow*

$

6,328

$

4,289

$

6,234

$

10,221

* Quarterly Adjusted Free Cash Flow fluctuates and should not be viewed as an indicator of annual performance. Onetime events, seasonality of capital spend and the timing of interest payments may result in negative Adjusted Free Cash Flow in one or more quarters.

NonGAAP Measures:

Adjusted Free Cash Flow is a non-GAAP liquidity measure and is defined as Adjusted EBITDA, less recurring operating cash requirements which include capital expenditures, cash income taxes refunded or paid, cash interest paid, amortization of GCI capacity revenue, cash severance expense for the Company's former Chief Executive Officer, and cash receipts and payments, deferred costs and amortized revenue and expense associated with certain prefunded special projects as defined in the 2019 Senior Credit Facility. Amortization of deferred revenue associated with our interconnection agreement with GCI is excluded from Adjusted Free Cash Flow because no cash was received by the Company in connection with this agreement. Amortization of all other deferred revenue, including that associated with other IRU capacity arrangements, is included in Adjusted Free Cash Flow because cash was received by the Company, typically at contract inception, and is being recognized as revenue over the term of the relevant agreement.

See Schedule 3 for Net cash provided by operating activities, Net cash used by investing activities, and Net cash (used) provided by financing activities.

See Schedule 5 for the reconciliation of net cash provided by operating activities to Adjusted Free Cash Flow.

Schedule 7

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

REVENUE BY CUSTOMER GROUP

(Unaudited, In Thousands)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Business and wholesale revenue

Business broadband

$

15,654

$

15,368

$

46,358

$

46,036

Business voice and other

7,200

7,199

21,442

21,088

Managed IT services

1,789

1,480

4,965

3,936

Equipment sales and installations

942

1,488

2,830

3,870

Wholesale broadband

11,284

9,305

31,989

28,221

Wholesale voice and other

1,870

1,525

4,688

4,455

Total business and wholesale revenue

38,739

36,365

112,272

107,606

Growth in business and wholesale

6.5

%

4.3

%

Consumer revenue

Broadband

6,718

6,539

19,880

19,726

Voice and other

2,567

2,719

7,947

8,355

Total consumer revenue

9,285

9,258

27,827

28,081

Total business, wholesale, and consumer revenue

48,024

45,623

140,099

135,687

Growth in business, wholesale and consumer revenue

5.3

%

3.3

%

Growth in broadband revenue

7.8

%

4.5

%

Regulatory revenue

Access

6,181

7,682

18,563

23,321

High cost support

4,923

4,924

14,770

14,771

Total regulatory revenue

11,104

12,606

33,333

38,092

Total revenue

$

59,128

$

58,229

$

173,432

$

173,779

Growth in total revenue

1.5

%

-0.2

%

Growth Revenues: Business broadband, Managed IT services, Equipment sales and installations, Wholesale broadband, and Consumer broadband

Legacy Revenues: Business voice and other, Wholesale voice and other, Consumer voice and other, and Access

CAF II Revenues: High Cost Support

Schedule 8

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

KEY OPERATING STATISTICS

(Unaudited)

Three Months Ended

September 30,

June 30,

September 30,

2019

2019

2018

Voice:

Business access lines

67,606

67,984

70,110

Consumer access lines

23,565

24,337

26,497

Voice ARPU business

$

27.10

$

27.03

$

25.35

Voice ARPU consumer

$

33.98

$

33.94

$

32.05

Broadband:

Business connections

14,942

15,050

15,368

Consumer connections

31,466

32,407

32,773

Broadband ARPU business

$

346.97

$

340.77

$

332.37

Broadband ARPU consumer

$

69.87

$

68.16

$

65.58

Monthly Average Churn:

Business voice

0.7

%

1.0

%

0.8

%

Consumer broadband

3.0

%

2.8

%

2.8

%

Consumer voice

1.4

%

1.5

%

1.4

%

Schedule 9

ALASKA COMMUNICATIONS SYSTEMS GROUP, INC.

LONG TERM DEBT AND NET DEBT

(Unaudited, In Thousands)

September 30,

December 31,

2019

2018

2019 senior secured credit facility due 2024

$

178,875

$

-

Debt discount - 2019 senior secured credit facilities due 2024

(2,408

)

-

Debt issuance costs - 2019 senior secured credit facilities due 2024

(1,992

)

-

2017 senior secured credit facility due 2023

-

171,750

Debt discount - 2017 senior secured credit facilities due 2023

-

(2,024

)

Debt issuance costs - 2017 senior secured credit facilities due 2023

-

(2,182

)

Capital leases and other long-term obligations

2,740

2,768

Total debt

177,215

170,312

Less current portion

(5,674

)

(2,289

)

Long-term obligations, net of current portion

$

171,541

$

168,023

Total debt

$

177,215

$

170,312

Plus debt discounts and debt issuance costs

4,400

4,206

Gross debt

181,615

174,518

Cash and cash equivalents

(25,046

)

(13,351

)

Net debt

$

156,569

$

161,167

View source version on businesswire.com: https://www.businesswire.com/news/home/20191106005893/en/