COGENT COMMUNICATIONS HOLDINGS INC

For the period ended Jun 30, 2024. Filed Aug 8, 2024.

About this filing

A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Jun 30, 2024 · Filed Aug 8, 2024

CCOI$4.35-2.2%Stored close · as of Nov 10, 2026

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Contents

Item 1. Financial Statements

ITEM 1.

FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2024 AND DECEMBER 31, 2023

(IN THOUSANDS, EXCEPT SHARE DATA)


· June 30, · December 31,
· · 2024 · · 2023
· · (Unaudited) · · ·
Assets
Current assets:
Cash and cash equivalents	$384,419	$75,092
Restricted cash	41,822	38,689
Accounts receivable, net of allowance for credit losses of $6,382 and $3,677, respectively	111,676	135,475
Due from T-Mobile, IP Transit Services Agreement, current portion, net of discount of $19,992 and $24,898, respectively	80,008	179,269
Due from T-Mobile, Transition Services Agreement	3,862	4,514
Prepaid expenses and other current assets	67,688	80,588
Total current assets	689,475	513,627
Property and equipment:
Property and equipment	3,103,518	2,947,376
Accumulated depreciation and amortization	(1,522,908)	(1,409,559)
Total property and equipment, net	1,580,610	1,537,817
Right-of-use leased assets	332,065	361,587
IPv4 intangible assets	458,000	458,000
Other intangible assets, net	13,926	14,815
Deposits and other assets	26,455	23,438
Due from T-Mobile, IP Transit Services Agreement, net of discount of $19,558 and $27,916, respectively	222,108	263,750
Due from T-Mobile, Purchase Agreement, net of discount of $6,581 and $13,725, respectively	21,534	38,585
Total assets	$3,344,173	$3,211,619
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$38,510	$48,356
Accrued and other current liabilities	189,131	120,523
Due to T-Mobile – Transition Services Agreement	2,286	66,908
Due to T-Mobile – Purchase Agreement	—	4,981
Current maturities, operating lease liabilities	61,780	67,962
Finance lease obligations, current maturities	21,253	64,594
Total current liabilities	312,960	373,324
Senior secured 2026 notes, net of unamortized debt costs of $511 and $645, respectively, and discounts of $680 and $857, respectively	498,809	498,498
Senior unsecured 2027 notes, net of unamortized debt costs of $2,163 and $941, respectively, and discounts of $8,332 and $1,970, respectively	739,505	447,088
Secured IPv4 notes, net of debt costs of $7,323	198,677	—
Operating lease liabilities, net of current maturities	309,055	330,095
Finance lease obligations, net of current maturities	405,176	419,921
Deferred income tax liabilities	406,335	471,498
Other long-term liabilities	58,133	61,639
Total liabilities	2,928,650	2,602,063
Commitments and contingencies:
Stockholders’ equity:
Common stock, $0.001 par value; 75,000,000 shares authorized; 48,990,760 and 48,608,569 shares issued and outstanding, respectively	49	49
Additional paid-in capital	610,905	606,755
Accumulated other comprehensive loss	(21,141)	(14,385)
Accumulated (deficit) earnings	(174,290)	17,137
Total stockholders’ equity	415,523	609,556
Total liabilities and stockholders’ equity	$3,344,173	$3,211,619

The accompanying notes are an integral part of these condensed consolidated balance sheets.

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

FOR THE THREE MONTHS ENDED JUNE 30, 2024 AND JUNE 30, 2023

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)


· · Three Months Ended · Three Months Ended
· June 30, 2024 · · June 30, 2023
· · (Unaudited) · (Unaudited)
Service revenue	$260,443	$239,806
Operating expenses:
Network operations (including $350 and $231 of equity-based compensation expense, respectively, exclusive of depreciation and amortization shown separately below)	156,167	137,502
Selling, general, and administrative (including $3,215 and $6,018 of equity-based compensation expense, respectively)	68,345	83,658
Acquisition costs – Sprint Business	12,370	739
Depreciation and amortization	74,036	52,511
Total operating expenses	310,918	274,410
Gain on lease termination	3,332	—
Operating loss	(47,143)	(34,604)
Interest expense, including change in valuation interest rate swap agreement	(29,541)	(29,958)
Gain on bargain purchase – Sprint Business	27,673	1,155,719
Interest income – IP Transit Services Agreement	5,934	7,669
Interest income – Purchase Agreement	402	506
Interest income and other, net	2,484	200
(Loss) income before income taxes	(40,191)	1,099,532
Income tax benefit	7,853	24,331
Net (loss) income	$(32,338)	$1,123,863

Comprehensive (loss) income:
Net (loss) income	$(32,338)	$1,123,863
Foreign currency translation adjustment	(1,722)	1,741
Comprehensive (loss) income	$(34,060)	$1,125,604

Net (loss) income per common share:
Basic net (loss) income per common share	$(0.68)	$23.84
Diluted net (loss) income per common share	$(0.68)	$23.65
Dividends declared per common share	$0.975	$0.935

Weighted-average common shares - basic	47,511,613	47,137,822

Weighted-average common shares - diluted	47,511,613	47,526,207

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CONDENSED CONSOLIDATED STATEMENTS OF****COMPREHENSIVE (LOSS) INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND JUNE 30, 2023

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)


· Six Months Ended · Six Months Ended
· · June 30, 2024 · · June 30, 2023
· (Unaudited) · (Unaudited)
Service revenue	$526,613	$393,395
Operating expenses:
Network operations (including $385 and $380 of equity-based compensation expense, respectively, exclusive of depreciation and amortization shown separately below)	324,752	196,140
Selling, general, and administrative (including $10,131 and $12,450 of equity-based compensation expense, respectively)	145,392	128,736
Acquisition costs – Sprint Business	21,407	1,139
Depreciation and amortization	144,930	77,669
Total operating expenses	636,481	403,684
Gain on lease termination	3,332	—
Operating loss	(106,536)	(10,289)
Interest expense, including change in valuation interest rate swap agreement	(58,703)	(47,116)
Gain on bargain purchase – Sprint Business	22,202	1,155,719
Interest income – IP Transit Services Agreement	13,264	7,669
Interest income – Purchase Agreement	(78)	506
Interest income and other, net	5,226	3,695
(Loss) income before income taxes	(124,625)	1,110,184
Income tax benefit	26,980	19,827
Net (loss) income	$(97,645)	$1,130,011

Comprehensive (loss) income:
Net (loss) income	$(97,645)	$1,130,011
Foreign currency translation adjustment	(6,756)	3,529
Comprehensive (loss) income	$(104,401)	$1,133,540

Net (loss) income per common share:
Basic net (loss) income per common share	$(2.06)	$23.97
Diluted net (loss) income per common share	$(2.06)	$23.79
Dividends declared per common share	$1.940	$1.860

Weighted-average common shares - basic	47,408,786	47,142,074

Weighted-average common shares - diluted	47,408,786	47,508,334

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND JUNE 30, 2023

(IN THOUSANDS)


· Six Months Ended · Six Months Ended
· June 30, 2024 · June 30, 2023
· · (Unaudited) · · (Unaudited)
Cash flows from operating activities:
Net (loss) income	$(97,645)	$1,130,011
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	144,930	77,669
Amortization of debt costs and discounts	1,106	652
Amortization of discounts, due from T-Mobile, IP Transit Services & Purchase Agreements	(13,186)	(8,175)
Equity-based compensation expense (net of amounts capitalized)	10,516	12,830
Gain on bargain purchase – Sprint Business	(22,202)	(1,155,719)
Gains – lease terminations and other, net	(3,332)	(608)
Deferred income taxes	(43,554)	(27,190)
Changes in operating assets and liabilities:
Accounts receivable	23,799	(4,918)
Prepaid expenses and other current assets	12,900	(14,140)
Due to T-Mobile – Transition Services Agreement	(64,622)	118,777
Due from T-Mobile – Transition Services Agreement	(11,671)	(7,015)
Unfavorable lease liabilities	(3,843)	(6,469)
Accounts payable, accrued liabilities and other long-term liabilities	66,541	2,637
Deposits and other assets	(2,688)	133
Net cash (used in) provided by operating activities	(2,951)	118,475
Cash flows from investing activities:
Cash payments - IP Transit Services Agreement – T-Mobile	154,167	29,167
Acquisition of Sprint Business, net of $47.1 million of cash acquired in 2023	12,323	(14,034)
Purchases of property and equipment	(89,650)	(60,653)
Net cash provided by (used in) investing activities	76,840	(45,520)
Cash flows from financing activities:
Dividends paid	(93,782)	(90,218)
Purchases of common stock	(7,968)	—
Net proceeds from issuance of senior unsecured 2027 Notes - net of discount of $6.8 million and debt costs of $1.4 million	291,879	—
Net proceeds from issuance of secured IPv4 notes – net of debt costs of $7.6 million	198,420	—
Proceeds from exercises of stock options	204	385
Principal payments of finance lease obligations	(42,131)	(17,247)
Settlement of finance lease – at a discount	(114,576)	—
Net cash provided by (used in) financing activities	232,046	(107,080)
Effect of exchange rates changes on cash	6,525	2,166
Net increase (decrease) in cash, cash equivalents and restricted cash	312,460	(31,959)
Cash, cash equivalents and restricted cash, beginning of period	113,781	275,912
Cash, cash equivalents and restricted cash, end of period	$426,241	$243,953
Supplemental disclosure of non-cash financing activities:
Fair value of equipment acquired in leases	$—	$171
Finance lease obligations incurred	$96,606	$42,639

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COGENT COMMUNICATIONS HOLDINGS, INC., AND SUBSIDIARIES

ContentsView on SEC.gov

The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.