US Cellular 2015 Annual Report Download - page 38

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12MAR201610541045
BUSINESS OVERVIEW
Under TDS Telecom’s OneNeck IT Solutions brand, TDS Telecom offers a full-suite of IT solutions ranging from
equipment resale to full management and hosting of a customer’s IT infrastructure and applications. The goal of HMS
operations is to create, deliver, and support a platform of IT products and services tailored for mid-market business
customers.
FINANCIAL OVERVIEW — HMS
Components of Operating Income (Loss)
Year Ended December 31, 2015 2014 2013 2015 vs. 2014 2014 vs. 2013
(Dollars in thousands)
Service revenues ................ $ 116,810 $ 109,766 $ 94,875 $ 7,044 6% $ 14,891 16%
Equipment and product sales ........ 169,985 148,966 90,741 21,019 14% 58,225 64%
Total operating revenues .......... 286,795 258,732 185,616 28,063 11% 73,116 39%
Cost of services (excluding depreciation,
amortization and accretion reported
below) ..................... 85,163 77,392 60,423 7,771 10% 16,969 28%
Cost of equipment and products ...... 142,927 126,362 75,991 16,565 13% 50,371 66%
Selling, general and administrative ..... 47,104 53,020 44,945 (5,916) (11)% 8,075 18%
275,194 256,774 181,359 18,420 7% 75,415 42%
Operating cash flow* .............. 11,601 1,958 4,257 9,643 >100% (2,299) (54)%
Depreciation, amortization and accretion . . 26,948 26,912 24,262 36 – 2,650 11%
Loss on impairment of assets ........ –84,000 – (84,000) N/M 84,000 N/M
(Gain) loss on asset disposals, net ..... 89 181 125 (92) (51)% 56 45%
Total operating expenses ........ 302,231 367,867 205,746 (65,636) (18)% 162,121 79%
Total operating income (loss) ......... $ (15,436) $(109,135) $ (20,130) $ 93,699 86% $ (89,005) >(100)%
Adjusted EBITDA* ............... $ 11,538 $ 1,996 $ 4,349 $ 9,542 >100% $ (2,353) (54)%
Capital expenditures .............. $ 27,059 $ 36,618 $ 16,474 $ (9,559) (26)% $ 20,144 >100%
N/M – Not meaningful
* Represents a non-GAAP financial measure. Refer to Supplemental Information within this MD&A for a reconciliation of this measure.
30
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
HMS OPERATIONS