Atn International, Inc. ((ATNI)) has held its Q4 earnings call. Read on for the main highlights of the call.
The recent earnings call for Atn International, Inc. presented a mixed sentiment, reflecting both achievements and challenges. The company showcased successful expansion in fiber infrastructure and growth in its international segment, supported by significant government funding. However, these positive strides were counterbalanced by a notable revenue decline in the US telecom segment and a substantial goodwill impairment charge, highlighting the financial hurdles the company faces.
Expansion of Fiber Infrastructure
Atn International, Inc. reported a substantial expansion in its fiber infrastructure, increasing fiber route miles by 32% and doubling the number of broadband homes passed by high-speed services. This expansion has resulted in a 44% increase in high-speed capable customers, marking a significant milestone in the company’s strategic growth initiatives.
International Segment Growth
The international segment of Atn International, Inc. demonstrated robust growth, with adjusted EBITDA increasing by 10% year-over-year. Business service revenue rose by 6%, and business mobility revenue surged by 21%, underscoring the strength and potential of the company’s international operations.
Increased Cash Flow from Operations
The company’s financial resilience was highlighted by a 16% year-over-year increase in cash flow from operations. This improvement emphasizes Atn International, Inc.’s capital efficiency and its ability to generate cash flow even amidst challenging market conditions.
Significant Government Funding
Atn International, Inc. secured over $370 million in government grants to support its fiber deployments. This substantial funding reinforces the company’s position as a key provider of broadband infrastructure and highlights its strategic importance in the telecommunications sector.
Decline in US Telecom Revenue
The US telecom segment faced a significant setback, with fourth-quarter revenue declining by 18% year-over-year. This downturn was primarily due to the conclusion of the Emergency Connectivity Fund and a decrease in legacy wholesale roaming revenues, posing a challenge to the company’s domestic operations.
Overall Revenue Decline
The total company revenue for the fourth quarter stood at $680.5 million, marking a 9% decrease compared to the same period in 2023. The full-year revenue also saw a decline of 4% from 2023, reflecting the financial pressures faced by Atn International, Inc.
Goodwill Impairment Charge
A $35.3 million goodwill impairment charge significantly impacted the company’s financial performance, contributing to a full-year net loss of $26.4 million. This charge underscores the financial challenges and adjustments the company is navigating.
Prepaid Subscriber Decline
The international prepaid subscriber base experienced a decline, primarily due to increased competition in the largest market, Guyana. This drop in subscribers highlights the competitive pressures in the international telecommunications landscape.
Forward-Looking Guidance
Looking ahead, Atn International, Inc. provided guidance for 2025, focusing on stabilizing its US segment and expanding international margins. The company expects full-year revenue to align with 2024 levels, excluding construction revenues, and aims to maintain a flat adjusted EBITDA. Capital expenditures are projected between $90 and $100 million, leveraging substantial government grants to support fiber deployments. The company plans to focus on long-term growth through investments in fiber infrastructure and enterprise solutions, optimizing operations, and enhancing shareholder value.
In conclusion, Atn International, Inc.’s earnings call revealed a mixed sentiment, with significant progress in strategic areas like fiber expansion and international growth, offset by financial challenges in key segments. The company’s forward-looking guidance suggests a focus on stabilizing and growing its operations, leveraging government support, and enhancing shareholder value.