EX-99.1 2 tdsq420208-kex991.htm EX-99.1 Document

Exhibit 99.1 NEWS RELEASE
As previously announced, TDS will hold a teleconference on February 19, 2021 at 9:00 a.m. CST. Listen to the call live via the Events & Presentations page of investors.tdsinc.com.
TDS reports fourth quarter and full year 2020 results
2020 results at UScellular and TDS Telecom provide strong foundation for 2021
Provides 2021 guidance

CHICAGO (February 18, 2021) — Telephone and Data Systems, Inc. (NYSE:TDS) reported total operating revenues of $1,376 million for the fourth quarter of 2020, versus $1,336 million for the same period one year ago. Net income attributable to TDS shareholders and related diluted earnings per share were $14 million and $0.12, respectively, for the fourth quarter of 2020 compared to $12 million and $0.10, respectively, in the same period one year ago.
TDS reported total operating revenues of $5,225 million and $5,176 million for the years ended 2020 and 2019, respectively. Net income attributable to TDS shareholders and related diluted earnings per share were $226 million and $1.93, respectively, for the year ended 2020 compared to $121 million and $1.03, respectively, for the year ended 2019.
"The TDS Family of Businesses successfully overcame the challenges of 2020, finishing the year with excellent communications services, strong financial performance and heightened awareness of the essential services that TDS and our industry provides," said LeRoy T. Carlson, Jr., TDS President and CEO. "UScellular kept churn low throughout the year, acquired new retail connections, maintained strong cost discipline and produced fine financial results. Under the leadership of our new CEO, Laurent Therivel, UScellular is in a strong position to focus on growth in 2021. TDS Telecom accomplished a transformational year as execution of its broadband-focused strategy enabled it to respond to the seismic shift to remote working and learning, highlighting the importance of high-speed broadband in the home.
"UScellular grew its service revenues, driven primarily by higher ARPU, and customers taking higher-value services and it maintained operational, quality and cost discipline. These factors contributed to increased profitability year-over-year. Significant progress was achieved with both network modernization and deployment of 5G. In 2021, connecting customers, especially in underserved areas, with the highest-quality network continues to be one of UScellular’s top priorities and remains a key competitive differentiator. UScellular will also be focused on market share expansion, ramping up business and government customer opportunities that utilize 5G and IoT, enhancing customers’ digital experiences, and continuing its network modernization and 5G programs.
"TDS Telecom achieved excellent growth in residential customer connections and strong financial performance in 2020, reflecting the successful execution of its broadband strategy, bolstered by increased consumer demand for broadband services caused by the large shift to remote work and learning. Out-of-territory fiber expansions and customers increasing their data speeds drove higher revenues. Successful efforts to reduce costs enabled TDS Telecom to redirect more resources to important growth opportunities. TDS Telecom’s cable segment continued to significantly grow through the Continuum acquisition and increases in broadband penetration. TDS Telecom expanded its deployment of fiber both inside and outside of its traditional markets. Given the positive impacts we are seeing from our fiber investments, TDS Telecom plans to expand its fiber program by doubling the number of service addresses it builds in 2021.
“Our associates showed tremendous focus, resilience and dedication during this incredibly challenging year. I thank each of them. TDS’ strong performance is a direct result of their hard and thoughtful work. The TDS Team looks forward to a very successful 2021, and to the progress we will continue to make on our long-term growth initiatives throughout the TDS Family of Businesses.”

2021 Estimated Results

TDS’ current estimates of full-year 2021 results for UScellular and TDS Telecom are shown below. Such estimates represent management’s view as of February 18, 2021 and should not be assumed to be current as of any future date. TDS undertakes no duty to update such estimates, whether as a result of new information, future events, or otherwise. There can be no assurance that final results will not differ materially from estimated results.

UScellular2021 Estimated ResultsActual Results for
the Year Ended
December 31, 2020
(Dollars in millions)  
Service revenues$3,025-$3,125$3,067
Adjusted OIBDA1
Adjusted EBITDA1
Capital expenditures$775-$875$940
TDS Telecom2021 Estimated ResultsActual Results for
the Year Ended
December 31, 2020
(Dollars in millions)
Total operating revenues$975-$1,025$976
Adjusted OIBDA1
Adjusted EBITDA1
Capital expenditures$425-$475$368


The following tables provide reconciliations of Net income to Adjusted OIBDA and Adjusted EBITDA for 2021 estimated results and actual results for the year ended December 31, 2020. In providing 2021 estimated results, TDS has not completed the below reconciliation to Net income because it does not provide guidance for income taxes. Although potentially significant, TDS believes that the impact of income taxes cannot be reasonably predicted; therefore, TDS is unable to provide such guidance.
UScellularTDS Telecom
(Dollars in millions)  
Net income (GAAP)N/A$233N/A$100
Add back:  
Income tax expenseN/A17 
Income before income taxes (GAAP)$135-$285$250$80-$110$117
Add back:
Interest expense135 112 — (4)
Depreciation, amortization and accretion expense685 683 210 203 
Add back or deduct:
(Gain) loss on asset disposals, net20 25 — 
(Gain) loss on license sales and exchanges, net— (5)— — 
(Gain) loss on investments— (2)— — 
Adjusted EBITDA (Non-GAAP)1
Equity in earnings of unconsolidated entities170 179 — — 
Interest and dividend income— 
Other, net— — — (1)
Adjusted OIBDA (Non-GAAP)1
Numbers may not foot due to rounding.
1EBITDA, Adjusted EBITDA and Adjusted OIBDA are defined as net income adjusted for the items set forth in the reconciliation above. EBITDA, Adjusted EBITDA and Adjusted OIBDA are not measures of financial performance under Generally Accepted Accounting Principles in the United States (GAAP) and should not be considered as alternatives to Net income or Cash flows from operating activities, as indicators of cash flows or as measures of liquidity. TDS does not intend to imply that any such items set forth in the reconciliation above are non-recurring, infrequent or unusual; such items may occur in the future. Management uses Adjusted EBITDA and Adjusted OIBDA as measurements of profitability, and therefore reconciliations to Net income are deemed appropriate. Management believes Adjusted EBITDA and Adjusted OIBDA are useful measures of TDS’ operating results before significant recurring non-cash charges, gains and losses, and other items as presented above as they provide additional relevant and useful information to investors and other users of TDS’ financial data in evaluating the effectiveness of its operations and underlying business trends in a manner that is consistent with management’s evaluation of business performance. Adjusted EBITDA shows adjusted earnings before interest, taxes, depreciation, amortization and accretion, and gains and losses, while Adjusted OIBDA reduces this measure further to exclude Equity in earnings of unconsolidated entities and Interest and dividend income in order to more effectively show the performance of operating activities excluding investment activities. The table above reconciles EBITDA, Adjusted EBITDA and Adjusted OIBDA to the corresponding GAAP measure, Net income or Income before income taxes. Additional information and reconciliations related to Non-GAAP financial measures for December 31, 2020, can be found on TDS' website at investors.tdsinc.com.

Conference Call Information
TDS will hold a conference call on February 19, 2021 at 9:00 a.m. Central Time.
Access the live call on the Events & Presentations page of investors.tdsinc.com or at
Access the call by phone at 833-968-2187 (US/Canada), conference ID: 5593349
Before the call, certain financial and statistical information to be discussed during the call will be posted to investors.tdsinc.com. The call will be archived on the Events & Presentations page of investors.tdsinc.com.
About TDS
Telephone and Data Systems, Inc. (TDS), a Fortune 1000® company, provides wireless; cable and wireline broadband, video and voice; and hosted and managed services to approximately 6 million connections nationwide through its businesses, UScellular, TDS Telecom, BendBroadband and OneNeck IT Solutions. Founded in 1969 and headquartered in Chicago, TDS employed 9,200 people as of December 31, 2020.
Visit investors.tdsinc.com for comprehensive financial information, including earnings releases, quarterly and annual filings, shareholder information and more.
Jane W. McCahon, Senior Vice President - Corporate Relations and Corporate Secretary
Julie D. Mathews, IRC, Director - Investor Relations
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company’s plans, beliefs, estimates, and expectations. These statements are based on current estimates, projections, and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: intense competition; the ability to obtain or maintain roaming arrangements with other carriers on acceptable terms; the ability to obtain access to adequate radio spectrum to meet current or anticipated future needs, including participation in FCC auctions; the ability to attract people of outstanding talent throughout all levels of the organization; TDS’ smaller scale relative to larger competitors; changes in demand, consumer preferences and perceptions, price competition, or churn rates; advances in technology; impacts of costs, integration problems or other factors associated with acquisitions, divestitures or exchanges of properties or wireless spectrum licenses and/or expansion of TDS’ businesses; the ability of the company to successfully construct and manage its networks; difficulties involving third parties; uncertainties in TDS’ future cash flows and liquidity and access to the capital markets; the ability to make payments on TDS and UScellular indebtedness or comply with the terms of debt covenants; conditions in the U.S. telecommunications industry; the value of assets and investments; the state and federal regulatory environment; pending and future litigation; cyber-attacks or other breaches of network or information technology security; disruption in credit or other financial markets; deterioration of U.S. or global economic conditions; the impact, duration and severity of public health emergencies, such as the COVID-19 pandemic. Investors are encouraged to consider these and other risks and uncertainties that are more fully described under “Risk Factors” in the most recent filing of TDS’ Form 10-K.
For more information about TDS and its subsidiaries, visit:
TDS: www.tdsinc.com
UScellular: www.uscellular.com
TDS Telecom: www.tdstelecom.com
OneNeck IT Solutions: www.oneneck.com

United States Cellular Corporation
Summary Operating Data (Unaudited)
As of or for the Quarter Ended12/31/20209/30/20206/30/20203/31/202012/31/2019
Retail Connections     
Total at end of period4,412,000 4,401,000 4,372,000 4,359,000 4,383,000 
Gross additions171,000 168,000 129,000 132,000 170,000 
Feature phones2,000 4,000 3,000 2,000 2,000 
Smartphones117,000 98,000 82,000 88,000 128,000 
Connected devices52,000 66,000 44,000 42,000 40,000 
Net additions (losses)11,000 28,000 12,000 (26,000)(12,000)
Feature phones(9,000)(8,000)(8,000)(10,000)(11,000)
Smartphones12,000 8,000 11,000 (10,000)13,000 
Connected devices8,000 28,000 9,000 (6,000)(14,000)
$47.51 $47.10 $46.24 $47.23 $46.57 
$124.87 $123.27 $120.70 $122.92 $120.99 
Churn rate3
1.21 %1.06 %0.89 %1.21 %1.38 %
Handsets1.01 %0.88 %0.71 %0.95 %1.11 %
Connected devices2.64 %2.35 %2.24 %3.11 %3.44 %
Total at end of period499,000 506,000 496,000 494,000 506,000 
Gross additions56,000 65,000 62,000 57,000 63,000 
Net additions (losses)(8,000)11,000 2,000 (12,000)(3,000)
$35.15 $35.45 $34.89 $34.07 $34.11 
Churn rate3
4.24 %3.59 %4.05 %4.67 %4.40 %
Total connections at end of period4
4,968,000 4,962,000 4,919,000 4,903,000 4,941,000 
Market penetration at end of period
Consolidated operating population31,314,000 31,314,000 31,292,000 31,292,000 30,740,000 
Consolidated operating penetration5
16 %16 %16 %16 %16 %
Capital expenditures (millions)$320 $216 $168 $236 $243 
Total cell sites in service6,797 6,758 6,673 6,629 6,578 
Owned towers4,271 4,246 4,208 4,184 4,166 
Due to rounding, the sum of quarterly results may not equal the total for the year.
1Average Revenue Per User (ARPU) - metric is calculated by dividing a revenue base by an average number of connections and by the number of months in the period. These revenue bases and connection populations are shown below:
Postpaid ARPU consists of total postpaid service revenues and postpaid connections.
Prepaid ARPU consists of total prepaid service revenues and prepaid connections.
2Average Revenue Per Account (ARPA) - metric is calculated by dividing total postpaid service revenues by the average number of postpaid accounts and by the number of months in the period.
3Churn rate represents the percentage of the connections that disconnect service each month. These rates represent the average monthly churn rate for each respective period.
4Includes reseller and other connections.
5Market penetration is calculated by dividing the number of wireless connections at the end of the period by the total estimated population of consolidated operating markets.

TDS Telecom
Summary Operating Data (Unaudited)
As of or for the Quarter Ended12/31/20209/30/20206/30/20203/31/202012/31/2019
TDS Telecom     
Residential connections     
256,900 260,000 261,800 259,100 262,100 
262,900 260,700 255,100 242,700 241,300 
63,000 62,300 61,400 59,000 58,500 
Wireline residential connections582,800 583,000 578,300 560,700 561,900 
Total residential revenue per connection4
$51.33 $51.45 $49.73 $50.12 $49.11 
Commercial connections
106,700 109,400 112,400 114,400 117,800 
21,000 20,800 20,700 20,500 20,400 
111,400 114,900 115,500 118,300 121,200 
200 200 200 100 100 
Wireline commercial connections239,400 245,400 248,700 253,400 259,600 
Total Wireline connections822,200 828,400 827,000 814,200 821,500 
Cable residential and commercial connections
209,400 206,200 203,700 196,800 193,500 
100,800 101,800 103,400 105,100 106,600 
66,800 67,700 69,000 68,900 69,500 
1,900 1,800 1,800 1,400 1,300 
Total Cable connections378,900 377,400 378,000 372,300 370,900 
Numbers may not foot due to rounding.
1The individual circuits connecting a customer to Wireline’s central office facilities that provide voice services.
2The number of Wireline customers provided high-capacity data circuits via various technologies, including DSL and dedicated internet circuit technologies.
3The number of Wireline customers provided video services.
4Total residential revenue per connection is calculated by dividing total Wireline residential revenue by the average number of Wireline residential connections and by the number of months in the period.
5The number of telephone handsets, data lines and IP trunks providing communications using IP networking technology.
6Billable number of lines into a building for high-speed data services.
7Generally, a home or business receiving video programming counts as one video connection. In counting bulk residential or commercial connections, such as an apartment building or hotel, connections are counted based on the number of units/rooms within the building receiving service.
8Billable number of lines into a building for voice services.
TDS Telecom
Capital Expenditures (Unaudited)
Quarter Ended12/31/20209/30/20206/30/20203/31/202012/31/2019
(Dollars in millions)     
Wireline$122 $74 $58 $39 $98 
Cable25 18 17 15 26 
Total TDS Telecom$147 $92 $75 $54 $124 

Telephone and Data Systems, Inc.
Consolidated Statement of Operations Highlights
 Three Months Ended
December 31,
Year Ended
December 31,
vs. 2019
vs. 2019
(Dollars and shares in millions, except per share amounts)      
Operating revenues      
UScellular$1,073 $1,052 %$4,037 $4,022 
TDS Telecom248 235 %976 930 %
All Other1
55 49 10 %212 224 (6)%
 1,376 1,336 %5,225 5,176 %
Operating expenses     
Expenses excluding depreciation, amortization and accretion895 871 %3,161 3,190 (1)%
Depreciation, amortization and accretion168 178 (6)%683 702 (3)%
(Gain) loss on asset disposals, net11 91 %25 19 36 %
(Gain) loss on sale of business and other exit costs, net — N/M (1)N/M
(Gain) loss on license sales and exchanges, net(5)— N/M(5)— N/M
 1,069 1,055 %3,864 3,910 (1)%
TDS Telecom      
Expenses excluding depreciation, amortization and accretion175 162 %663 629 %
Depreciation, amortization and accretion50 51 (1)%203 200 %
(Gain) loss on asset disposals, net — 38 %1 (7)N/M
 226 213 %866 823 %
All Other1
Expenses excluding depreciation and amortization55 53 %211 235 (10)%
Depreciation and amortization6 (22)%23 30 (23)%
(Gain) loss on asset disposals, net — N/M1 — 19 %
 60 60 236 264 (11)%
Total operating expenses1,355 1,328 %4,966 4,997 (1)%
Operating income (loss)      
UScellular4 (3)N/M173 112 54 %
TDS Telecom23 21 %110 107 %
All Other1
(6)(11)47 %(24)(40)41 %
 21 N/M259 179 45 %
Investment and other income (expense)
Equity in earnings of unconsolidated entities43 39 11 %181 168 %
Interest and dividend income3 (33)%15 29 (49)%
Gain (loss) on investments(1)— N/M2 — N/M
Interest expense(50)(37)(36)%(168)(165)(2)%
Other, net (1)N/M(1)— N/M
Total investment and other income(5)N/M29 32 (10)%
Income before income taxes16 14 13 %288 211 36 %
Income tax expense (1)N/M19 64 (71)%
Net income16 15 %269 147 83 %
Less: Net income attributable to noncontrolling interests, net of tax2 (44)%43 26 70 %
Net income attributable to TDS shareholders$14 $12 18 %$226 $121 86 %
Basic weighted average shares outstanding114 115 114 114 
Basic earnings per share attributable to TDS shareholders$0.12 $0.10 19 %$1.97 $1.06 86 %
Diluted weighted average shares outstanding115 116 115 116 
Diluted earnings per share attributable to TDS shareholders$0.12 $0.10 21 %$1.93 $1.03 87 %
N/M - Percentage change not meaningful.
Numbers may not foot due to rounding.
1    Consists of TDS corporate, intercompany eliminations and all other business operations not included in the UScellular and TDS Telecom segments.

Telephone and Data Systems, Inc.
Consolidated Statement of Cash Flows
Year Ended December 31,20202019
(Dollars in millions)  
Cash flows from operating activities
Net income$269 $147 
Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
Depreciation, amortization and accretion909 932 
Bad debts expense77 112 
Stock-based compensation expense53 59 
Deferred income taxes, net190 34 
Equity in earnings of unconsolidated entities(181)(168)
Distributions from unconsolidated entities189 162 
(Gain) loss on asset disposals, net27 12 
(Gain) loss on sale of business and other exit costs, net (1)
(Gain) loss on license sales and exchanges, net(5)— 
(Gain) loss on investments(2)— 
Other operating activities3 
Changes in assets and liabilities from operations
Accounts receivable(16)(49)
Equipment installment plans receivable(54)(97)
Inventory12 (19)
Accounts payable173 (60)
Customer deposits and deferred revenues4 (9)
Accrued taxes(120)(17)
Other assets and liabilities4 (26)
Net cash provided by operating activities1,532 1,016 
Cash flows from investing activities
Cash paid for additions to property, plant and equipment(1,338)(957)
Cash paid for acquisitions and licenses(172)(346)
Cash received from investments1 29 
Cash paid for investments(3)(11)
Cash received from divestitures and exchanges26 41 
Advance payments for license acquisitions(30)(5)
Other investing activities5 — 
Net cash used in investing activities(1,511)(1,249)
Cash flows from financing activities
Issuance of long-term debt1,250 — 
Repayment of long-term debt(110)(118)
TDS Common Shares reissued for benefit plans, net of tax payments(3)(6)
UScellular Common Shares reissued for benefit plans, net of tax payments(11)(9)
Repurchase of TDS Common Shares(14)— 
Repurchase of UScellular Common Shares(23)(21)
Dividends paid to TDS shareholders(78)(75)
Payment of debt issuance costs(41)(1)
Distributions to noncontrolling interests(2)(4)
Payments to acquire additional interest in subsidiaries(11)— 
Other financing activities 14 
Net cash provided by (used in) financing activities957 (220)
Net increase (decrease) in cash, cash equivalents and restricted cash978 (453)
Cash, cash equivalents and restricted cash
Beginning of period474 927 
End of period$1,452 $474 

Telephone and Data Systems, Inc.
Consolidated Balance Sheet Highlights

December 31,20202019
(Dollars in millions)  
Current assets  
Cash and cash equivalents$1,429 $465 
Short-term investments3 — 
Accounts receivable, net1,112 1,124 
Inventory, net154 169 
Prepaid expenses105 98 
Income taxes receivable187 36 
Other current assets36 29 
Total current assets3,026 1,921 
Assets held for sale2 — 
Licenses2,638 2,480 
Goodwill547 547 
Other intangible assets, net213 239 
Investments in unconsolidated entities477 488 
Property, plant and equipment, net
3,972 3,527 
Operating lease right-of-use assets998 972 
Other assets and deferred charges652 607 
Total assets$12,525 $10,781 

Telephone and Data Systems, Inc.
Consolidated Balance Sheet Highlights

December 31,20202019
(Dollars in millions, except per share amounts)  
Current liabilities  
Current portion of long-term debt$5 $10 
Accounts payable508 374 
Customer deposits and deferred revenues193 189 
Accrued interest16 11 
Accrued taxes69 41 
Accrued compensation132 121 
Short-term operating lease liabilities129 116 
Other current liabilities101 100 
Total current liabilities1,153 962 
Liabilities held for sale1 — 
Deferred liabilities and credits  
Deferred income tax liability, net863 676 
Long-term operating lease liabilities940 931 
Other deferred liabilities and credits541 481 
Long-term debt, net3,424 2,316 
Noncontrolling interests with redemption features10 11 
TDS shareholders' equity  
Series A Common and Common Shares, par value $0.01 per share1 
Capital in excess of par value2,482 2,468 
Treasury shares, at cost(477)(479)
Accumulated other comprehensive loss(4)(9)
Retained earnings2,802 2,672 
Total TDS shareholders' equity4,804 4,653 
Noncontrolling interests789 751 
Total equity5,593 5,404 
Total liabilities and equity$12,525 $10,781 

Balance Sheet Highlights
 December 31, 2020
TDS Corporate
& Other
(Dollars in millions)     
Cash and cash equivalents$1,271 $178 $170 $(190)$1,429 
Licenses, goodwill and other intangible assets$2,629 $761 $$— $3,398 
Investment in unconsolidated entities435 45 (7)477 
 $3,064 $765 $53 $(7)$3,875 
Property, plant and equipment, net$2,466 $1,408 $98 $— $3,972 
Long-term debt, net:
Current portion$$— $$— $
Non-current portion2,489 931 — 3,424 
 $2,491 $$934 $— $3,429 

TDS Telecom Highlights
 Three Months Ended
December 31,
Year Ended
December 31,
 202020192020 vs. 2019202020192020 vs. 2019
(Dollars in millions)      
Operating revenues      
Residential$90 $83 %$349 $328 %
Commercial37 40 (8)%152 168 (9)%
Wholesale46 47 (3)%182 186 (2)%
Total service revenues173 171 %684 682 
Equipment and product sales — (34)%1 (31)%
 173 171 %685 683 
Operating expenses      
Cost of services72 68 %269 263 %
Cost of equipment and products — (55)%1 (36)%
Selling, general and administrative expenses51 50 %199 199 
Expenses excluding depreciation, amortization and accretion123 119 %468 463 %
Depreciation, amortization and accretion30 33 (9)%124 132 (6)%
(Gain) loss on asset disposals, net — N/M (8)N/M
 154 153 %593 587 %
Operating income$19 $18 %$92 $96 (4)%
Operating revenues      
Residential$63 $53 19 %$245 $205 20 %
Commercial13 11 15 %47 43 10 %
 76 64 18 %292 247 18 %
Operating expenses      
Cost of services33 26 24 %123 105 17 %
Selling, general and administrative expenses19 17 12 %72 62 16 %
Expenses excluding depreciation, amortization and accretion52 44 19 %195 167 17 %
Depreciation, amortization and accretion20 17 16 %78 68 15 %
(Gain) loss on asset disposals, net — (87)%1 (26)%
 72 61 18 %274 236 16 %
Operating income$4 $17 %$18 $11 60 %
Total TDS Telecom operating income$23 $21 %$110 $107 %
N/M - Percentage change not meaningful.
Numbers may not foot due to rounding.

Telephone and Data Systems, Inc.
Financial Measures and Reconciliations

Free Cash Flow
 Three Months Ended
December 31,
Year Ended
December 31,
(Dollars in millions)    
Cash flows from operating activities (GAAP)$366 $142 $1,532 $1,016 
Less: Cash paid for additions to property, plant and equipment424 326 1,338 957 
Free cash flow (Non-GAAP)1
$(58)$(184)$194 $59 
1Free cash flow is a non-GAAP financial measure which TDS believes may be useful to investors and other users of its financial information in evaluating liquidity, specifically, the amount of net cash generated by business operations after deducting Cash paid for additions to property, plant and equipment.