Thank you for standing by, and welcome to ATN International's Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator Instructions].

I would now like to hand the call over to Justin Benincasa, Chief Financial Officer. Please go ahead. .

Thank you, operator, and good morning, everyone. This morning, we'll be reviewing our fourth quarter and full year 2023 results and providing additional insights on 2024.

I'm joined today by Brad Martin, ATN's Chief Executive Officer; and Carlos Doglioli, ATN's incoming Chief Financial Officer; and Michael Prior, ATN's Executive Chairman, who will be available for the Q&A portion of the call. .

As a reminder, we announced our 2023 fourth quarter and full year results yesterday afternoon after the market closed. Investors can find the earnings release and conference call slide presentation on our Investor Relations website. .

Our earnings release and the presentation contain forward-looking statements concerning our current expectations, objectives and underlying assumptions regarding our future operating results. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described. .

Also, in an effort to provide useful information for investors, our comments today include non-GAAP financial measures.

For details on these measures and reconciliations to comparable GAAP measures, and for further information regarding the factors that may affect our future operating results, please refer to our earnings release on our website at atni.com, or the 8-K filing provided to the SEC. .

And now I'll turn the call over to Brad. .

Thank you, Justin. Good morning, everyone, and thank you for joining us. It's a pleasure to be here for our first earnings call as ATN's CEO. I'll begin covering highlights from our Q4 and fiscal year 2023 performance and progress executing our strategy.

Following that, Justin will review our financials in more detail and provide an update on our 2024 guidance. This is a significant time in ATN's journey.

We've entered the third and final year of our strategic investment plan to expand the reach, capability of our high-speed networks and to bring more high-speed data services to remote and underserved consumers and businesses. .

The investments we are making position ATN to continue delivering high-quality, reliable services to our customers, while providing a solid foundation for growing high-speed data subscribers and recurring revenues, expanding free cash flows and delivering sustainable value creation for our stakeholders in the years ahead.

As a result, ATN today is a stronger, more resilient company. .

We concluded a solid 2023, with a strong fourth quarter, executing on our First-to-Fiber and Glass and Steel investment strategy. Our continued conversion of customers to our high-speed networks and focus on margin improvement contributed to subscriber growth, higher revenue and margin expansion.

In fact, both the quarter and the year, we achieved single-digit revenue growth and double-digit expansion of adjusted EBITDA. Justin will expand more on our financial results shortly, but first, I'd like to start with 4 key points that frame our 2023 performance and the opportunities ahead for ATN. .

First, in 2023, we executed several important strategic milestones that are key to our success going forward. We advanced our First-to-Fiber and Glass and Steel investment strategy by adding fiber-rich digital infrastructure in the markets we serve. In May, we announced our long-term agreement with Verizon.

We have made strong progress towards our multiyear effort to transition our large carrier customers from legacy wholesale roaming services to carrier managed services that provide ATN with greater revenue stability. .

We completed the integration of Sacred Wind, a core addition to our operations, and expanded our business and retail broadband operations domestically. In 2023, we also completed initiatives to rightsize operations to better support the business into the future. These actions are now complete in the U.S. and essentially completed internationally.

All in all, we have enhanced our capabilities to better serve our customers and provide high-quality, reliable products and services for the coming years. .

As a result of these combined efforts, ATN is operating from a strong and scalable foundation as we enter 2024. Second, our First-to-Fiber and Glass and Steel infrastructure investments are yielding results across key operational metrics.

Expanding high-speed network reach and capabilities provides a solid foundation for delivering strong recurring revenues, durable free cash flow and shareholder value over the long term. .

Since launching our strategy at the start of 2022, we've increased high-speed broadband subscribers by 39%, nearly doubled broadband homes passed by high-speed data services, and expanded our fiber network reach by nearly 50%. Third, our performance validates ATN's strong market position. .

As we have said before, we play directly into what is unquestionably 1 of the world's most durable secular growth drivers, the need to be connected anytime and everywhere. Our network's reliability, consistency and efficiency has improved customer satisfaction as exemplified by strong subscriber growth and low churn.

Our deeply embedded relationships with local communities, customers, enterprises, governments and carriers continue to position ATN with an essential competitive advantage. .

And fourth, as we look to 2024 and beyond, we're committed to managing our balance sheet to maximize cash flow expansion and to realize the full benefits of our investments in the years ahead. .

While we plan to continue to invest in our network expansion this year, we will move down the other side of our 3-year investment bell curve.

As we dial back internally funded capital spending, we continue to leverage our upgraded network footprint and available grant funding to augment network expansions and continue to grow our subscriber base and recurring revenue. .

Additionally, we will continue to advance margin improvement initiatives to manage run rate operating costs. All in all, these actions position ATN to reap the full benefits of our network investment in the years ahead, including accelerated cash flow generation and subscriber and revenue growth at higher incremental margins. .

Let's turn to operational wins. Providing high-speed connectivity to more customers and as many remote and underserved reasons as possible is core to our mission and strategy. In Q4, we continue to make great progress on this front in both the U.S. and international markets. .

We exited 2023 with 20% more high-speed broadband subscribers and 33% more broadband home passed by high-speed data services compared to the prior year. We also have had great success scaling our fiber footprint. Fiber has many advantages. It's more energy efficient, requires less maintenance and provides superior customer experience. .

As we replace and decommission legacy copper networks with fiber networks, we are positioning ATN to deliver higher margin revenue over time. We exited 2023 with 11,650 fiber route miles, an 11% year-over-year increase, and increased our fiber homes passed footprint by 32%. .

Now taking a closer look at operational highlights by segment. Starting with our International segment, which represents about half of ATN's revenue and includes operations in Bermuda and Caribbean, where we operate in fast-growing markets like Cayman Islands and Guyana.

Across this segment, we continue to see rapid uptake of high-speed broadband, with high-speed data subscriber growth of 20% year-over-year. .

Additionally, we have seen strong mobile subscriber growth, which grew 8% in 2023 behind investments in network core upgrade, densification and 5G rollouts.

We remain optimistic about the growth and free cash flow expansion opportunities across our international markets as we continue to benefit from networking and operating investments, attractive market tailwinds and our unique value proposition. .

Our U.S. segment, which serves rural communities in the West and Southwest as well as urban and rural areas of Alaska accounts for the other half of ATN's revenue. In Q4, we achieved several key operational milestones in the U.S.

as we advanced our domestic strategy to increase broadband homes passed by high-speed data and pivot away from our legacy wireless wholesale roaming business by meeting our carrier customers' evolving business needs.

We expanded our middle and last mile fiber networks, advanced the capacity and reach of our next-generation fixed wireless network, enabling 7% year-over-year growth on recurring business data revenue. .

In the U.S., we continue to pursue grant funding to augment our fiber and fixed wireless high-speed network expansion in rural areas, including parts of Alaska, Arizona, Nevada and New Mexico. In Q4, we were recipients of nearly $4 million in Federal grants, bringing total awarded grants to us and our partners to $91.2 million in 2023. .

Also in Q4, we renewed our agreement with the Alternative Connect America Model Program, or ACAM, locking in the continuation of the subsidy funding to serve locations into Mexico in the amount of $118 million over the next 15 years. .

As it relates to grants and external funding, I want to clarify a few key points. First, one of our core competencies at ATN is our deep understanding of the mechanics of grants and third-party funding. We have a long track record of using discretion to ensure that grants we participate in are economically viable.

Second, the network builds funded by these and future grants are expected to extend over the next several years. .

As a result, these funds will support our continued network expansion and customer revenue growth even as the pace of our self-funded capital decreases as planned. And third, ATN is well positioned to compete for the $4.2 billion of B telecom infrastructure funding allocated to the 6 states that we operate in.

We are actively working in jurisdictions on the opportunities that align with our business strategy. .

In conclusion, our strategy to expand high-speed network reach capabilities, while managing costs through margin improvement initiatives, positions ATN to reap the benefits of our investment for years to come. Looking ahead to 2024, it's all about continued execution of our plan. .

Our priorities remain to continue growing high-speed data network subscriber base and expanding our fiber footprint through targeted internal funded investments, albeit at a slower pace as we come down the backside of our 3-year investment bell curve, to pursue economically viable grants to augment these internal investments, to advance margin improvement initiatives, and to manage our balance sheet to maximize cash flow and increase shareholder value.

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And with that, I'll hand the call back to you, Justin. .

Great. Thank you, Brad. ATN's strong fourth quarter and full year performance reflects our team's hard work executing against our 3-year strategic investment plan. In 2023, we achieved consistent top line growth and even stronger adjusted EBITDA growth, well in line with our guidance for the year. .

Turning to the P&L highlights. In Q4, total company revenue of $199 million grew 4% before construction revenue compared with the same period in 2022. Higher fixed revenue was driven by growth in rural broadband revenue and high-speed data subscribers.

The quarter also benefited from $3.1 million of nonrecurring revenue associated with engineering services we provided on a fiber deployment. .

For the full year, revenue totaled $762.2 million. This represents a 6% increase over the prior year, excluding construction revenue from both periods, reflecting the momentum of our strategic network investments. Operating income in the fourth quarter was $3.3 million versus $4.7 million in Q4 of 2022.

The year-over-year decrease was due to a $6.6 million restructuring charge related to our ongoing efforts to better align our cost structure to the future needs of the business, and a $1.3 million net loss on the disposition of assets and changes in contingent considerations. .

Full year operating income for 2023 increased to $13.2 million, which was negatively impacted by restructuring charges of $11.2 million. This compares to operating income of $7.9 million in the prior year. .

Adjusted EBITDA growth was exceptionally strong for both the fourth quarter and the full year, increasing 13% to $51 million for the quarter, and 10% to $189.5 million for the full year. This performance was fueled by strength across both segments as we benefited from higher revenue and our ongoing margin expansion initiatives. .

Net loss in Q4 was $5.8 million, or a loss of $0.46 per share, compared with prior year's net loss of $1.4 million, or a loss of $0.18 per share. The quarter was affected by the restructuring charge and a year-over-year increase in interest expense of $4.7 million. .

For the full year, the net loss was $14.5 million, or $1.25 per share, which included the restructuring charge of $11.2 million and higher interest expense year-over-year. This compares to a full year 2022 net loss of $5.6 million or $0.67 per share. .

Looking now at the segment performance. The International segment delivered revenue growth of 5% in the quarter and 4% for the full year. As Brad mentioned, we saw strong high-speed data subscriber growth that drove increased fixed broadband revenues.

Mobile revenues in the segment were flat in the quarter as strong subscriber growth for the segment was offset by a lower ARPU in some of our bigger prepaid markets. .

Adjusted EBITDA for the International segment increased 6% for the quarter and 4% for the full year. In our Domestic segment, total Q4 revenue grew 3%, driven by the growth in fixed revenue and engineering services, as I previously noted.

On a full year basis, Domestic revenue increased by 6% as we benefited from strong fixed revenue growth related to greater enterprise and emergency connectivity fund revenue in Alaska as well as the Sacred Wind acquisition. .

Carrier revenues were flat, both for the quarter and the year. As Brad mentioned, moving into 2024, we will have transitioned the bulk of the carrier service revenue from the legacy wholesale roaming revenue to offering a suite of infrastructure and network services to our large carrier customers in the U.S. .

Adjusted EBITDA for the Domestic segment was very strong, up 20% for the quarter, well outpacing our revenue growth, and up 17% for the year as we benefited from margin expansion efforts that we have been -- that have been in focus throughout the year. .

Moving on to the balance sheet and cash flow highlights. We exited the year with a net debt-to-adjusted EBITDA ratio of 2.4x on total debt outstanding of $517 million. Net cash provided by operating activities was $113 million for the year, up from $103 million in the prior year period as the funding of working capital improved in 2023. .

Maintaining the strength of our balance sheet remains a top priority for ATN, and we expect to continue expanding cash flow as we leverage the benefit of our investments made in our networks over the past few years. .

Turning now to capital expenditures. In line with our 3-year strategic investment plan for the full year 2023, we invested nearly $200 million, expanding both the reach and quality of our networks in all our markets.

Of the nearly $200 million invested, CapEx funded through operations was $163.3 million, and $32.9 million was funded through reimbursable government programs. These investments have upgraded the capabilities of our networks, and enabled our teams to greatly expand the reach of our fiber facilities that ATN can leverage for years to come. .

As provided in our guidance, our CapEx spending through operations is expected to decrease substantially in 2024 and continue to move lower into 2025. We expect to augment this more normalized CapEx spending levels with government subsidy grant programs and funding. .

Returning capital to shareholders remains a capital allocation priority. In 2023, ATN returned $15 million to shareholders through our share repurchase program, and we paid out an additional $13.2 million in dividends.

In December, we announced the Board of Directors' decision to increase the quarterly dividend 14% year-over-year to $0.24 per share, and the expansion of our share repurchase program, allowing the company to repurchase up to an additional $25 million of common shares. .

Turning now to our full year 2024 outlook. For the full year, we expect total company revenues in the range of $750 million to $770 million, excluding construction revenue. As a reminder, a $27 million annual COVID-related government contract is scheduled to expire at the end of the first quarter in our U.S.

segment, which will affect year-over-year revenue growth comparisons beginning in Q2. We expect other revenue growth to offset that reduction as we move through the year. .

We continue to expect adjusted EBITDA for the full year within our previously provided preliminary guidance range of $200 million to $208 million. As we move through 2024 and begin to expand cash flow, we expect to exit the year with a net debt ratio of between 2.25x to 2.4x.

As I mentioned previously, maintaining healthy debt levels is a top priority for ATN, and our goal remains to continue bringing leverage closer to 2x over the medium term. .

Turning now to our capital expenditure guidance. After reviewing our 2024 projects and the status of grant funding we are eligible for, we have lowered our capital expenditure outlook by $10 million to a new range of $110 million to $120 million.

As a result of the investments we've made, ATN is in an excellent position to expand cash flow and fuel profitable growth in the years to come. .

Finally, as announced at the end of last year, this will be my last earnings call as CFO before I retire. Reflecting on my past 18 years with ATN, I'm proud of the organization that we've built and the incredible progress this entire company has made together over the years.

I truly value my partnership with Michael over the past 18 years and the great team of financial executives and our assistant, Kathy, who supported us both for much of that time. I'd also like to express my gratitude for the opportunity to connect with many of you, our shareholders and analysts that cover ATN.

I truly appreciate the support you provided me over the years. .

Having worked closely with Brad for several years, I have the utmost confidence that he is the right leader for ATN at this stage in our transformation. Additionally, in my time with Carlos, I can assure you he is a seasonal leader, with strong industry knowledge, financial and operational experience and a collaborative approach to business.

I have the full confidence that Brad and Carlos will seamlessly lead ATN through the completion of a 3-year strategy and set a compelling vision for ATN's next phase of growth. .

Before opening up to questions, I'd like to just turn the call over to Carlos, who has a few words to say. .

Thanks, Justin. Hello, everyone. It is an honor to be here today. ATN is a solid company that has been investing in the foundation for the continuing creation of shareholder value.

Since joining ATN in January, I've been impressed with the thoroughness of ATN's finance team, the strength and experience of the leadership team and the clarity of the organization's mission and strategy. I am grateful for the quality time that I have spent with Justin.

I look forward to building on the disciplined financial foundation he has established to continue to generate value for our investors and stakeholders for years to come. I look forward to meeting with many of you in the months ahead. And with that, I turn the call back over to Brad. .

Thanks, Justin and Carlos. We are very excited for ATN's future. Through our First-to-Fiber and Glass and Steel investment strategies, and ongoing focus on margin improvement, we are laying the foundation for durable long-term growth in the years ahead. The ATN value proposition continues to resonate with customers around the globe.

Our teams remain energized, execute on our promise to help rural and underbuilt communities advance their quality of life through reliable, high-quality digital connectivity. With that, operator, we'd like to open up for questions. .

[Operator Instructions] Our first question comes from the line of Ric Prentiss of Raymond James. .

Yes. Justin, I wish you well in retirement. We enjoyed working with you. And Brad and Carlos, look forward to getting to know you guys better. .

Thank you. .

Thank you. .

First question, Justin, you called out that you've got this COVID program that's expiring in 1Q '24. Can you remind us what line item is that revenue and domestic.

How much was that in '23? And how much will it be in 1Q '24? Because obviously, it's affecting the revenue growth rate in '24 versus '23?.

Yes. It's a fixed revenue, so it's reported in fixed. It's been a pretty consistent number to the number we gave. So it's a $27 million program, and it's kind of pro rata over the quarter. So we'll have a pro rata amount Q1 then it will drop off. So it's roughly a $21 million impact next year. .

The $21 million for 3 quarters worth of '24 is what it would be down. .

Correct, right. So we'll have it in Q1, but then it drops. .

Right, right. Okay.

And is that a super high-margin business loan? Just wondering how that effect was into EBITDA?.

Yes. I mean it's a kind of for in our guidance. It did have a significant cost that came with it -- COGS that came with it, but it did have margin. .

Okay. Because when we think about -- and we can normalize for that now, obviously, you said to put $21 million in there. The revenue growth rate from '23 to '24 seems somewhat muted. Can you help us understand, you've spent all this CapEx. You've got these exciting ads to high-speed broadband in both of your regions.

How should we think about kind of where you want to head with revenue growth on a more normalized basis absent this COVID program?.

I still think, Ric, that we can be in the range that we guided to a while back, right, in the 4% to 6% range of revenue growth. This year, the drop in that ETF program definitely muted it, though, obviously. .

Okay. And then, Brad, you touched on margin improvements a couple of times in your comments.

What should we think of is -- what's the target you want to get to? And is it varied between domestic and international? Where should we think you're trying to drive this boat to as far as margin improvement?.

So thanks, Ric. So great question. It's obviously a key area of focus for the business. The current guidance on -- that we provided for 2024 includes a lot of these initiatives. Look, we always are measuring ourselves against benchmarks in the industry, but we are guiding beyond that.

And I think where we guide to '24 is a reflection on a continued focus that started through my course and my tenure here, my operational role and will continue to be a key focus for the business as we move forward. .

So the guidance for '24 kind of assumes that maybe a 27% margin?.

Yes. Yes, using the midpoint, I think, on that. .

And I would just say, too, it's in both segments, Ric, just kind of we're working on. .

Okay. Last question for me then. On the CapEx, obviously, getting back to more normal levels in '25, somewhere between 10% and 15% of total revenues ex-construction.

What would cause it to go to the low end of that range, what would cause it to go to the high end of the range? And obviously, I think that assumes that any government funding is separate and that gets netted out. .

Yes. So great question, Ric. And you specified the range. The major dynamics that move CapEx timing are really around success in the year. We do have markets where the markets we serve can be very complex to plan some of the timing because of complexity due to weather, for example.

But a big mover is the timing on the grant -- already awarded grant programs that come in to the business. So those can move specifically by state, by program. It does vary significantly. So that potentially could drive it to overall lower level, but it would be really specific to each individual market. .

Our next question comes from the line of Greg Burns of Sidoti. .

When you look at the broadband penetration homes passed versus subscriber growth, the subscriber growth is lagging the homes passed growth by a little bit.

Can you just talk about maybe your plans for marketing promotion, any activities or programs you might have in place to continue to increase that broadband penetration?.

Yes. Great. Thank you. Great question. So certainly, penetration, as quickly as possible, is always the core focus on any infrastructure build generally, we have -- we look at every single situation competitively, the different types of products, different types of competitive solutions across the portfolio.

So we are everywhere looking at how do we move the needle more quickly. We find a presell, and I mean we certainly tried to leverage as many techniques as possible to shorten that timing, but it does vary significantly market by market based on those competitive dynamics and the technology. .

But we are coming off a significant investment phase, and growing that base of homes passed provides us a great opportunity to continue to expand. .

Okay. And then in Guyana, there's some saber rattling going on down there.

What is your exposure there to maybe the disputed regions? And maybe, I guess, what the risk is to you that maybe something escalates in that region?.

Yes. I will start on that answer, and Michael who's been closest too, can chime in. Generally, this is something we obviously watch very closely. It's something that we stay very close to the other major U.S. investors in that market and the Exxon CEO spoke to this in their earnings call as well.

and spoke to the fact that they think it's a general low risk, but it's something that's watched very closely. And we make sure that the teams are aligned. The general disputed area is an area where very little of our infrastructure resides. It's a very unpopulated portion of Guyana. But it's something we're watching closely as things develop.

And we're certainly making sure we have our teams aligned around what we effectively are monitoring with our governments and our business partners.

Michael any thing to add to that?.

Yes, this is Michael. I don't think there's much to add. I would just emphasize that it's really around interruption for Guyana, which we certainly don't hope and we don't -- we hope that there's nothing like any kind of even minor military action. We don't get the sense that, that's likely from everyone we talk to, but who knows.

But the point is that from a pure economic and business standpoint, as Brad said, really all of our operators very, very little is in that region that Venezuela is claiming. .

Our next question comes from the line of Hamed Khorsand of BWS. .

So first off, I just want to ask you, there was a sequential bump in U.S.-related revenue by about $7 million or so, how much of that is -- you're able to retain going forward? I understand there's that grant money is coming off in Q2.

But outside of that, how much of that is realistically able to hold on to?.

Hamed, there was an engineering service revenue, right, that I spoke about in my part of the opening of about $3 million. So -- but I think generally I think a lot of that's sustainable, but for the fact of the ECS drop-off that I noted as well. .

Okay.

And then could you provide a little bit more details about the restructuring down that you took, and why you decided that you had to take it down?.

Yes. The restructuring was really kind of cost reduction initiatives, right, in terms of workforce and leases and things like that, that we took off. So there it predominantly is all onetime charges associated with exiting those costs. That answers your question. .

I guess I was asking why now? What was the impediment to do it now?.

It's really a part of the initiative to just kind of more efficiently run the business and improve the margins. .

Got it. And my last question was, last earnings call, you were talking about the churn going up in mobile, that came down.

What was the result of that as far as the improvement you've seen? Is that because of better marketing, the consumer there is happy with the mobile service they have and the mobile phones they have? I know in the past, you've talked about that they have 2 phones, and now they're back to 1. .

Yes. Hamed, I'll take that. Generally, there was a dynamic this year in 1 of our significant prepaid markets where there was a competitor that came in with a free offering with new network, a much smaller competitor. That did have an impact -- it did effectively have some positive impact for subscribers on data consumption.

So that was 1 of the dynamics that was effectively a 6-month free promotional period. So that is something that, that promotional period has ended. .

Congrats Justin on the retirement. .

Thank you Hamed. .

[Operator Instructions] Our next question comes from the line of Rick Prentiss of Raymond James. .

We'll give a few more questions here on your last call.

Did you all have any exposure to the ACP program? Is that what you're referring to in the COVID one? Or what was your exposure to ACP?.

Ric, that was not what we're referring to as the COVID. That was a different program called emergency connectivity Fund. ACP, we are watching this closely. We do have some exposure to the ACP. It's not a huge overall to ATN. We are still working to quantify the overall impact in options to help mitigate it. .

Okay.

Do you know how many subs you have sort of ability to kind of show us what that ballpark number is?.

Yes. We haven't given that, Ric, yet. I think we probably just more time for us to quantify it. .

Yes.

And the anticipation is that it might stop April, right?.

Yes, I think that's -- yes, yes. .

Yes. .

Okay. And other question for me is free cash flow looks like we're there on the cusp of turning the corner to be positive free cash flow. Can you talk a little bit about maybe cash taxes and interest, which would be the other items compared to EBITDA and CapEx.

But are you feeling pretty good that maybe even early this year, you get to that free cash flow positive dynamic? And then what kind of progress from there?.

Yes. I mean we're definitely striving to increase free cash flow, right? We've been repeating that message over and over. And I think in terms of interest -- so with that kind of our priority items to keep driving down leverage that will help on the interest cost.

I think in terms of interest expense, you've kind of seen that in the quarter, that's kind of a decent working number. Our cash taxes for better or for worse these days are pretty limited. But our goal is to keep expanding that free cash flow, bring down leverage, return it to shareholders. .

Okay.

And we don't usually include in our valuation free cash flow, but are there any unusual working capital items coming up?.

There is nothing out of the ordinary, but we are watching, like with the government reimbursement programs. So we've got some working capital already tied up in those programs, right, as we go through the replace and remove. But we're watching that.

We're trying to manage that closely, but that could be a little bit of a -- there's some work for us to not grow that part of the working capital too much. But it's out there because we have to -- kind of have to expend it before we get reimbursed. .

What's the lag as far as from spending to reimbursement? Is that 6, 9 months? Is it... .

I don't know. It's probably in a shorter period than that. .

It does vary by program, Ric, but we have seen much better than that. But some of these programs, certainly, the more sizable ones require a lot of details for those reimbursement. So -- but it has been measured in weeks, which is good.

And there have been some programs that allowed for pre-positioning, giving effectively a 6-month prepositioning of invoicing. .

And the trick for us is to try to manage how fast we're constructing and seeking reimbursement too, right? So it's -- there's a lot of management involved in it, obviously. .

Yes. .

It's worth adding to that just that we've also entered into agreements on some of the big vendor contracts that you get paid when we get paid kind of thing. .

Yes. .

And a lot of your reimbursement probably coming from states instead of the U.S. .

It is mostly U.S. Federal government, but there are some states as well. .

The ones we're working on now. .

Right, right. Right. Okay. If our government can get something done in weeks, that's -- all right. And the last 1 for me is just the leverage guidance changed a little bit. Previously, it was get to approximately 2x by end of '24, and now it's kind of the 2.25x to 4.40x. We were at 2.2x anywhere in our model.

Was that just kind of a fine-tuning of kind of the -- when you get to that closer to 2x range? Or is there anything specific different from prior guidance and now?.

No, it's probably I think it's just a little bit of fine-tuning how much working capital we might have tied up in some of the reimbursement programs, so that's where the fine tuning was. .

Justin, again, best wishes. .

Thank you, Ric. Appreciate it. Thanks for all the support over the years. .

As there are no further questions in queue, I would now like to turn the call over to Brad Martin, ATN's Chief Executive Officer for closing remarks.

Sir?.

Thank you, operator, and thank you all for joining us today. We will be participating in Sidoti's small-cap Virtual Investor Conference on March 14. We look forward to meeting with many of you there. I would like to take a moment to thank Justin for his leadership and his commitment to long-term tenure to ATN. I wish you all the best in your retirement.

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Thank you, Brad. .

And thank you again for your time. With that, operator, I'll turn it back to you. .

This concludes today's conference call. Thank you for participating. You may now disconnect..