TRILOGY INTERNATIONAL PARTNERS INC.
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE QUARTER ENDED SEPTEMBER 30, 2022
PART I - FINANCIAL INFORMATION Item 1) Financial Statements
TRILOGY INTERNATIONAL PARTNERS INC.
Condensed Consolidated Balance Sheets
(US dollars in thousands, except share amounts)
(unaudited)
September 30, | December 31, | |
2022 | 2021 |
ASSETS
Current assets:
Cash and cash equivalents Restricted cash Short-term investments Accounts receivable, net
Equipment Installment Plan ("EIP") receivables, net
Inventory
Sale proceeds held in escrow
Prepaid expenses and other current assets Total current assets
Property and equipment, net Operating lease right-of-use assets, net License costs and other intangible assets, net Goodwill
Long-term EIP receivables Deferred income taxes Other assets
Total assets
$ | 12,624 | $ | 53,486 | |
- | 1,524 | |||
13,895 | - | |||
- | 61,073 | |||
- | 41,663 | |||
- | 10,918 | |||
12,468 | - | |||
1,615 | 32,175 | |||
40,602 | 200,839 | |||
12 | 307,085 | |||
- | 120,414 | |||
- | 61,377 | |||
- | 9,689 | |||
- | 34,537 | |||
- | 23,890 | |||
- | 46,036 | |||
$ | 40,614 | $ | 803,867 |
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) | ||||||
Current liabilities: | ||||||
Accounts payable | $ | 129 | $ | 27,171 | ||
Construction accounts payable | - | 22,466 | ||||
Current portion of debt and financing lease liabilities | - | 31,589 | ||||
Customer deposits and unearned revenue | - | 25,851 | ||||
Short-term operating lease liabilities | - | 19,315 | ||||
Other current liabilities and accrued expenses | 6,730 | 99,231 | ||||
Total current liabilities | 6,859 | 225,623 | ||||
Long-term debt and financing lease liabilities | - | 631,685 | ||||
Deferred income taxes | - | 298 | ||||
Non-current operating lease liabilities | - | 168,437 | ||||
Other non-current liabilities | - | 23,858 | ||||
Total liabilities | 6,859 | 1,049,901 | ||||
Commitments and contingencies | - | - | ||||
Shareholders' equity (deficit): | ||||||
Common shares and additional paid-in capital; no par value, unlimited | ||||||
authorized, 88,627,603 and 86,461,484 shares issued and outstanding | - | 486 | ||||
Accumulated earnings (deficit) | 33,699 | (288,235) | ||||
Accumulated other comprehensive income | 56 | 6,860 | ||||
Total Trilogy International Partners Inc. shareholders' equity (deficit) | 33,755 | (280,889) | ||||
Noncontrolling interests | - | 34,855 | ||||
Total shareholders' equity (deficit) | 33,755 | (246,034) | ||||
Total liabilities and shareholders' equity (deficit) | $ | 40,614 | $ | 803,867 | ||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements
1
TRILOGY INTERNATIONAL PARTNERS INC.
Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income
(US dollars in thousands, except share and per share amounts)
(unaudited)
Three Months Ended | Nine Months Ended | ||||||||||
September 30, | September 30, | ||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||
Revenues | |||||||||||
Wireless service revenues | $ | - | $ | 104,018 | $ | 154,752 | $ | 316,582 | |||
Fixed broadband service revenues | - | 28,134 | 42,498 | 83,697 | |||||||
Equipment sales | - | 23,090 | 38,096 | 77,539 | |||||||
Non-subscriber international long distance and other | |||||||||||
revenues | - | 2,296 | 3,171 | 6,620 | |||||||
Total revenues | - | 157,538 | 238,517 | 484,438 | |||||||
Operating expenses | |||||||||||
Cost of service, exclusive of depreciation, amortization | |||||||||||
and accretion shown separately | - | 55,952 | 81,045 | 163,360 | |||||||
Cost of equipment sales | - | 25,190 | 39,157 | 84,240 | |||||||
Sales and marketing | - | 22,510 | 30,800 | 65,710 | |||||||
General and administrative | 3,407 | 29,213 | 60,367 | 89,097 | |||||||
Depreciation, amortization and accretion | 1 | 28,033 | 18,417 | 85,589 | |||||||
Impairment of long-lived assets | - | 113,844 | - | 113,844 | |||||||
Loss on disposal of assets and (gain) on sale of | |||||||||||
operations | - | 257 | (457,590) | 854 | |||||||
Total operating expenses | 3,408 | 274,999 | (227,804) | 602,694 | |||||||
Operating (loss) income | (3,408) | (117,461) | 466,321 | (118,256) | |||||||
Other (expenses) income | |||||||||||
Interest expense | - | (13,419) | (22,887) | (39,934) | |||||||
Change in fair value of warrant liability | - | - | 105 | 107 | |||||||
Debt extinguishment, modification and issuance costs | - | - | (8,527) | (7,016) | |||||||
Other, net | (2,018) | 2,204 | 13,607 | 4,442 | |||||||
Total other expenses | (2,018) | (11,215) | (17,702) | (42,401) | |||||||
(Loss) income before income taxes | (5,426) | (128,676) | 448,619 | (160,657) | |||||||
Income tax benefit (expense) | - | 972 | (11,337) | (5,258) | |||||||
Net (loss) income | (5,426) | (127,704) | 437,282 | (165,915) | |||||||
Less: Net loss (income) attributable to noncontrolling | |||||||||||
interests | - | 37,133 | (3,578) | 49,392 | |||||||
Net (loss) income attributable to Trilogy International | |||||||||||
Partners Inc. | $ | (5,426) | $ | (90,571) | $ | 433,704 | $ | (116,523) | |||
Comprehensive (loss) income | |||||||||||
Net (loss) income | $ | (5,426) | $ | (127,704) | $ | 437,282 | $ | (165,915) | |||
Other comprehensive (loss) income: | |||||||||||
Foreign currency translation adjustments | - | (2,494) | (13,197) | (8,583) | |||||||
Net income (loss) on short-term investments | 56 | - | 56 | (2) | |||||||
Other comprehensive income (loss) | 56 | (2,494) | (13,141) | (8,585) | |||||||
Comprehensive (loss) income | (5,370) | (130,198) | 424,141 | (174,500) | |||||||
Comprehensive loss (income) attributable to | |||||||||||
noncontrolling interests | - | 37,467 | (59) | 52,721 | |||||||
Comprehensive (loss) income attributable to Trilogy | |||||||||||
International Partners Inc. | $ | (5,370) | $ | (92,731) | $ | 424,082 | $ | (121,779) | |||
Net (loss) income attributable to Trilogy | |||||||||||
International Partners Inc. per share: | |||||||||||
Basic (see Note 14 - Earnings per Share) | $ | (0.06) | $ | (1.37) | $ | 4.95 | $ | (1.90) | |||
Diluted (see Note 14 - Earnings per Share) | $ | (0.06) | $ | (1.37) | $ | 4.91 | $ | (1.90) | |||
Weighted average common shares: | |||||||||||
Basic | 88,627,603 | 66,348,444 | 87,580,236 | 61,353,637 | |||||||
Diluted | 88,627,603 | 66,348,444 | 88,314,955 | 61,353,637 |
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements
2
TRILOGY INTERNATIONAL PARTNERS INC.
Condensed Consolidated Statements of Changes in Shareholders' Equity (Deficit)
(US dollars in thousands, except shares)
(unaudited)
Three Months Ended | Accumulated | ||||||||||||||||||
Additional | Accumulated | Other | Total | ||||||||||||||||
Common Shares | Paid-In | (Deficit) | Comprehensive | Noncontrolling | Shareholders' | ||||||||||||||
Shares | Amount | Capital | Earnings | Income | Interests | (Deficit) Equity | |||||||||||||
Balance, June 30, 2021 | 59,921,124 | $ | - | $ | 7,176 | $ | (123,321) | $ | 6,881 | $ | 25,231 | $ | (84,033) | ||||||
Dividends declared and paid | - | - | - | - | - | (3,182) | (3,182) | ||||||||||||
Equity-based compensation | - | - | 725 | - | - | 55 | 780 | ||||||||||||
Net loss | - | - | - | (90,571) | - | (37,133) | (127,704) | ||||||||||||
Other comprehensive loss | - | - | - | - | (2,160) | (334) | (2,494) | ||||||||||||
Redemption of Class C Units, issuance of shares related | |||||||||||||||||||
to RSUs and other | 25,917,778 | - | (7,901) | (44,508) | 3,287 | 49,080 | (42) | ||||||||||||
Balance, September 30, 2021 | 85,838,902 | $ | - | $ | - | $ | (258,400) | $ | 8,008 | $ | 33,717 | $ | (216,675) | ||||||
Balance, June 30, 2022 | 88,627,603 | $ | - | $ | - | $ | 39,125 | $ | - | $ | - | $ | 39,125 | ||||||
Net loss | - | - | - | (5,426) | - | - | (5,426) | ||||||||||||
Other comprehensive income | - | - | - | - | 56 | - | 56 | ||||||||||||
Balance, September 30, 2022 | 88,627,603 | $ | - | $ | - | $ | 33,699 | $ | 56 | $ | - | $ | 33,755 | ||||||
Nine Months Ended | Accumulated | ||||||||||||||||||
Additional | Accumulated | Other | Total | ||||||||||||||||
Common Shares | Paid-In | (Deficit) | Comprehensive | Noncontrolling | Shareholders' | ||||||||||||||
Shares | Amount | Capital | Earnings | Income | Interests | (Deficit) Equity | |||||||||||||
Balance, December 31, 2020 | 59,126,613 | $ | - | $ | 5,978 | $ | (97,369) | $ | 9,936 | $ | 42,566 | $ | (38,889) | ||||||
Dividends declared and paid | - | - | - | - | - | (5,673) | (5,673) | ||||||||||||
Equity-based compensation | - | - | 2,495 | - | - | 169 | 2,664 | ||||||||||||
Net loss | - | - | - | (116,523) | - | (49,392) | (165,915) | ||||||||||||
Other comprehensive loss | - | - | - | - | (5,256) | (3,329) | (8,585) | ||||||||||||
Redemption of Class C Units, issuance of shares related | |||||||||||||||||||
to RSUs and other | 26,712,289 | - | (8,473) | (44,508) | 3,328 | 49,376 | (277) | ||||||||||||
Balance, September 30, 2021 | 85,838,902 | $ | - | $ | - | $ | (258,400) | $ | 8,008 | $ | 33,717 | $ | (216,675) | ||||||
Balance, December 31, 2021 | 86,461,484 | $ | - | $ | 486 | $ | (288,235) | $ | 6,860 | $ | 34,855 | $ | (246,034) | ||||||
Equity-based compensation | - | - | 3,485 | - | - | 87 | 3,572 | ||||||||||||
Net income | - | - | - | 433,704 | - | 3,578 | 437,282 | ||||||||||||
Other comprehensive loss | - | - | - | - | (9,622) | (3,519) | (13,141) | ||||||||||||
Forfeiture of shares | (1,675,336) | - | - | - | - | - | - | ||||||||||||
Return of capital, net of distribution repaid | - | - | (1,333) | (111,634) | - | - | (112,967) | ||||||||||||
Issuance of shares related to RSUs, change in | |||||||||||||||||||
noncontrolling interests and other | 3,841,455 | - | (2,638) | (136) | 2,818 | (35,001) | (34,957) | ||||||||||||
Balance, September 30, 2022 | 88,627,603 | $ | - | $ | - | $ | 33,699 | $ | 56 | $ | - | $ | 33,755 |
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements
3
TRILOGY INTERNATIONAL PARTNERS INC. Condensed Consolidated Statements of Cash Flows (US dollars in thousands)
(unaudited)
Nine Months Ended
September 30,
2022 | 2021 | ||||
Operating activities: | |||||
Net income (loss) | $ | 437,282 | $ | (165,915) | |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating | |||||
activities: | |||||
Provision for doubtful accounts | 2,759 | 6,856 | |||
Depreciation, amortization and accretion | 18,417 | 85,589 | |||
Equity-based compensation | 3,572 | 2,664 | |||
Impairment of long-lived assets | - | 113,844 | |||
(Gain) on sale of operations and loss on disposal of assets | (457,590) | 854 | |||
Non-cashright-of-use asset lease expense | 3,686 | 15,165 | |||
Non-cash interest expense | 3,385 | 5,597 | |||
Settlement of cash flow hedges | (335) | (1,331) | |||
Change in fair value of warrant liability | (105) | (107) | |||
Debt extinguishment costs | 8,527 | - | |||
Non-cash gain from change in fair value on cash flow hedges | (2,946) | (3,280) | |||
Gain on forward exchange contracts and unrealized foreign exchange transactions | (14,789) | (461) | |||
Deferred income taxes | 396 | 57 | |||
Changes in operating assets and liabilities: | |||||
Accounts receivable | (6,460) | (13,681) | |||
EIP receivables | 5,207 | (374) | |||
Inventory | (1,470) | 3,337 | |||
Prepaid expenses and other current assets | (12,693) | (12,472) | |||
Other assets | (1,546) | (3,192) | |||
Accounts payable | (6,989) | 6,650 | |||
Operating lease liabilities | (7,376) | 3,238 | |||
Other current liabilities and accrued expenses | 23,738 | (1,639) | |||
Customer deposits and unearned revenue | (1,866) | 32 | |||
Net cash (used in) provided by operating activities | (7,196) | 41,431 | |||
Investing activities: | |||||
Proceeds from the sale of operations, inclusive of proceeds from forward exchange | |||||
contract of $16.6 million, net of cash sold of $51.1 million | 552,210 | - | |||
Purchase of property and equipment | (32,429) | (65,449) | |||
Purchase of short-term investments | (13,837) | - | |||
Purchase of spectrum licenses and other additions to license costs | - | (6,735) | |||
Maturities and sales of short-term investments | - | 9,987 | |||
Other, net | (687) | (3,688) | |||
Net cash provided by (used in) investing activities | 505,257 | (65,885) | |||
Financing activities: | |||||
Payments of debt, including sale-leaseback and EIP receivables financing obligations | (438,807) | (374,694) | |||
Return of capital, net of distribution repaid | (112,967) | - | |||
Proceeds from debt | 10,000 | 350,000 | |||
Proceeds from EIP receivables financing obligation | 7,290 | 33,514 | |||
Dividends to noncontrolling interests | - | (5,673) | |||
Other, net | (2,778) | (2,200) | |||
Net cash (used in) provided by financing activities | (537,262) | 947 | |||
Net decrease in cash, cash equivalents and restricted cash | (39,201) | (23,507) | |||
Cash, cash equivalents and restricted cash, beginning of period | 55,010 | 102,525 | |||
Effect of exchange rate changes | (3,185) | (1,382) | |||
Cash, cash equivalents and restricted cash, end of period | $ | 12,624 | $ | 77,636 |
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements
4
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Trilogy International Partners Inc. published this content on 08 December 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 December 2022 15:02:05 UTC.