US Cellular 2011 Annual Report Download - page 12

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events or otherwise. There can be no assurance that final results will not differ materially from such
estimated results.
2012 2011
Estimated Results(1) Actual Results
Service revenues .......................... $4,050 - $4,150 million $4,053.8 million
Operating income .......................... $200 - $300 million $ 280.8 million
Depreciation, amortization and accretion expenses,
and net gain or loss on asset disposals and
exchanges and loss on impairment of assets(2) . . Approx. $600 million $ 571.7 million
Adjusted OIBDA(3) ......................... $800 - $900 million $ 852.5 million
Capital expenditures ........................ Approx. $850 million $ 783.0 million
(1) These estimates are based on U.S. Cellular’s current plans, which include a multi-year
deployment of 4G LTE technology which commenced in 2011. New developments or changing
conditions (such as customer net growth, customer demand for data services or possible
acquisitions, dispositions or exchanges) could affect U.S. Cellular’s plans and, therefore, its
2012 estimated results.
(2) 2011 Actual Results include gains on asset disposals and exchanges, net of $1.9 million. The
2012 Estimated Results include only Depreciation, amortization and accretion expenses; such
estimated results do not include net gains or losses related to disposals and exchanges of
assets or losses on impairments of assets (since such transactions and their effects cannot be
predicted).
(3) Adjusted OIBDA is defined as operating income excluding the effects of depreciation,
amortization and accretion (OIBDA): the net gain or loss on asset disposals and exchanges (if
any); and the loss on impairment of assets (if any). This measure also may be commonly
referred to by management as operating cash flow. This measure should not be confused with
Cash flows from operating activities, which is a component of the Consolidated Statement of
Cash Flows. Adjusted OIBDA excludes the net gain or loss on asset disposals and exchanges
(if any) and loss on impairment of assets (if any), in order to show operating results on a more
comparable basis from period to period. U.S. Cellular does not intend to imply that any of such
amounts that are excluded are non-recurring, infrequent or unusual and, accordingly, they may
be incurred in the future. U.S. Cellular believes this measure provides useful information to
investors regarding U.S. Cellular’s financial condition and results of operations because it
highlights certain key cash and non-cash items and their impacts on cash flows from operating
activities.
U.S. Cellular management currently believes that the foregoing estimates represent a reasonable view of
what is achievable considering actions that U.S. Cellular has taken and will be taking. However, the
current general economic and competitive conditions in the markets served by U.S. Cellular have created
a challenging environment that could continue to significantly impact actual results. U.S. Cellular expects
to continue its focus on customer satisfaction by delivering a high quality network, attractively priced
service plans, a broad line of wireless devices and other products, and outstanding customer service in
its company-owned and agent retail stores and customer care centers. U.S. Cellular believes that future
growth in its revenues will result primarily from selling additional products and services, including data
products and services, to its existing customers, increasing the number of multi-device users among its
existing customers, and attracting wireless users switching from other wireless carriers, rather than by
adding users that are new to wireless service. U.S. Cellular is focusing on opportunities to increase
revenues, pursuing cost reduction initiatives in various areas and implementing a number of initiatives to
enable future growth. The initiatives are intended, among other things, to allow U.S. Cellular to accelerate
its introduction of new products and services, better segment its customers for new services and
retention, sell additional services such as data, expand its Internet sales and customer service
capabilities, improve its prepaid products and services and reduce operational expenses over the long
term.
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