To Our Shareholders
At TDS, our mission is to provide outstanding communication services to our customers, and to meet the needs of our shareholders, our people and our communities. By following this mission, we seek to continuously grow our businesses and steadily build value over the long term for our shareholders.
Consolidated operating results
Operating revenues were stable in 2009, despite the weak economy and intense competition across all of our businesses, and we achieved growth in important areas:
- U.S. Cellular increased wireless data revenues 33 percent, contributing 17 percent of service revenues;
- TDS Telecom increased its wireline (ILEC/CLEC combined) high-speed data customers by 12 percent; and
- TDS repurchased six percent of its shares outstanding, and increased its quarterly dividend for the 35th consecutive year.
Overall profitability was reduced by the increasing cost of adding and retaining customers, as well as by the expected loss of high-margin wireless roaming revenue resulting from industry consolidation.
Expenses related to launching major enablement initiatives are putting near-term pressure on our goal of achieving a return on capital greater than the weighted average cost of capital in each business. We believe, however, that these initiatives are critical to helping us achieve this important, long-term goal.
As part of our ongoing efforts to build value for shareholders, TDS authorized a new, $250 million share repurchase program in November, after completing the previous program well ahead of schedule. U.S. Cellular also authorized a new program in November to repurchase up to 1.3 million shares per year, and to carry unused purchases over to subsequent years. During 2009:
- TDS repurchased 6.4 million shares, for $176.6 million, and
- U.S. Cellular repurchased 887,000 shares, for $33.6 million.
TDS ended the year with a strong consolidated cash balance of more than $650 million, and investment-grade credit ratings from all three major ratings agencies.
- TDS and U.S. Cellular were among a select group of 206 companies named as “Trustworthy Corporations” by Audit Integrity in 2010.