Shenandoah Telecommunications Co · NASDAQ:SHEN
Shenandoah Telecommunications — Q4 2020 Earnings Presentation
32 slides from Shenandoah Telecommunications's earnings presentation, Feb 25, 2021
Slide 1: Q4 2020 Earnings Conference Call
Q4 2020 Earnings Conference Call February 25, 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our business strategy, our prospects and our financial position. These statements can be
Slide 3: Chris French, President and CEO
Chris French President and CEO 3
Slide 4: Record Broadband Results
Record Broadband Results Broadband Data Net Additions 4
Slide 5: Unique network platform with high growth potential
Unique network platform with high growth potential TARGET PO S I TI ON Greenfield fixed wireless Incumbent Greenfield fiber overbuilder MARKET broadband overbuilder DYNAMIC M ARK ET Higher density tier III / IV TYPE Various, but mostly rural Low density rural markets 2020/2026 TARGET HOMES 209,000 /
Slide 6: Pending Wireless Sale and Use of Proceeds Update
Pending Wireless Sale and Use of Proceeds Update a T-Mobile exercised option to purchase Wireless assets operations a Sales price of $1.95 billion determined through appraisal process and agreement with T-Mobile Expected timeline: 1 Execute asset purchase agreement in the first quarter 2021 1 Obtain
Slide 7: Jim Volk, SVP of Finance and CFO
Jim Volk SVP of Finance and CFO 7
Slide 8: Broadband Highlights - Fourth Quarter Results
Broadband Highlights - Fourth Quarter Results Revenue (in millions) Adjusted OIBDA (in millions) 3.5% 7.8% 41.6% 39.9% margin margin 8
Slide 9: Tower Highlights - Fourth Quarter Results
Tower Highlights - Fourth Quarter Results Revenue (in millions) Adjusted OIBDA (in millions) 18.9% 20.4% 63.7% 62.9% margin margin 9
Slide 10: Consolidated Highlights - Fourth Quarter Results
Consolidated Highlights - Fourth Quarter Results Revenue (in millions) Adjusted OIBDA (in millions) 8.5% 20.4% Consolidated revenue includes elimination of intercompany activity. 10
Slide 11: Broadband Highlights - Full Year Results
Broadband Highlights - Full Year Results Revenue (in millions) Adjusted OIBDA (in millions) 0.5% 5.4% 41.8% 39.9% margin margin 11
Slide 12: Tower Highlights - Full Year Results
Tower Highlights - Full Year Results Revenue (in millions) Adjusted OIBDA (in millions) 31.3% 29.7% 62.9% 63.7% margin margin 12
Slide 13: Consolidated Highlights - Full Year Results
Consolidated Highlights - Full Year Results Revenue (in millions) Adjusted OIBDA (in millions) $241 - $248 10.6% $17 - $18 27.2% $69 - $76 6.7% 15.8% $10.5 - $11.5 $90 - $94 $224 - $230 $(31.5) - $(29.5) Consolidated revenue includes elimination of intercompany activity. 13
Slide 14: Capitalization
Capitalization Total Debt & Liquidity (in millions) YTD Free Cash Flow by Segment (in millions) Effective Interest Rate of 2.31% $(67.1) 14
Slide 15: Dave Heimbach, EVP and COO
XG -—~ Dave Heimbach EVP and COO AXSHENTEL
Slide 16: Broadband - Incumbent Cable Metrics
Broadband - Incumbent Cable Metrics Revenue Generating Units (RGU) Broadband Data Average Revenue per User (ARPU) Broadband Data Penetration Broadband Data Churn 16
Slide 17: Broadband - Glo Fiber Metrics
Broadband - Glo Fiber Metrics Revenue Generating Units (RGU) Broadband Data Average Revenue per User (ARPU) Broadband Data Penetration Broadband Data Churn 17
Slide 18: Glo Fiber Market Update
Glo Fiber Market Update Passings Penetration Released to Target as of Sales Passings* Launch Date 12/31/2020 Harrisonburg VA 9,843 11,399 October 2019 18.6% Staunton VA 9,856 9,895 February 2020 13.8% Front Royal VA 4,237 4,933 March 2020 11.3% Winchester VA 4,716 9,957 March 2020 10.3% Salem VA 8,0
Slide 19: Integrated Fiber, Cable and Fixed Wireless Broadband Network
Integrated Fiber, Cable and Fixed Wireless Broadband Network 19
Slide 20: Tower - Metrics
Tower - Metrics Towers Tenants 20
Slide 21: Capital Expenditures
Capital Expenditures Capex Spending ($ in millions) $157 - $168 $2 - $3 $100 - $105 $55 - $60 *Excludes CapEx for Glo Fiber and Beam Fixed Wireless 21
Slide 22: Q&A
Q&A AXSHENTEL
Slide 23: Appendix
HENTEL Appendix
Slide 24: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Included in this presentation are certain non-GAAP financial measures that are not determined in accordance with U.S. generally accepted accounting principles. These financial performance measures are not indicative of cash provided or used by operating activities
Slide 25: Adjusted OIBDA by Segment - Quarterly Results
Adjusted OIBDA by Segment - Quarterly Results Three Months Ended December 31, 2020 Corporate (in thousands) Broadband Tower & Other Consolidated Operating income (loss) $ 10,710 $ 2,379 $ (11,475) $ 1,614 Depreciation 10,377 492 1,573 12,442 Amortization of intangible assets 251 — — 251 OIBDA 21,338
Slide 26: Adjusted OIBDA by Segment - Full Year Results
Adjusted OIBDA by Segment - Full Year Results Twelve Months Ended December 31, 2020 Corporate (in thousands) Broadband Tower & Other Consolidated Operating income (loss) $ 40,360 $ 8,823 $ (50,330) $ (1,147) Depreciation 40,337 1,906 5,721 47,964 Amortization 739 — — 739 OIBDA 81,436 10,729 (44,609)
Slide 27: Normalized Free Cash Flow and Free Cash Flow
Normalized Free Cash Flow and Free Cash Flow Twelve Months Ended December 31, 2020 Total Discontinued Continuing (in thousands) Operations Broadband Tower Corporate Operations Net Cash Provided by Operations $ 249,508 $ 76,677 $ 7,969 $ (31,287) $ 53,359 Less: Capital Expenditures* (17,565) (58,117)
Slide 28: Broadband - Average Revenue per User (ARPU)
Broadband - Average Revenue per User (ARPU) For the fourth quarter ended, 2019 2020 Residential & SMB Revenue (000's) Broadband $ 19,377 $ 23,618 Incumbent Cable $ 19,377 $ 22,787 Glo Fiber $ — $ 819 Beam Wireless $ — $ 12 Video $ 14,783 $ 14,840 Voice $ 2,850 $ 2,912 Average Revenue Generating Unit
Slide 29: Broadband Revenue by Quarter (000's) - 2018 - 2020
Broadband Revenue by Quarter (000's) - 2018 - 2020 Q1 Q2 Q3 Q4 Full Year 2020 Residential & SMB $ 37,009 $ 37,685 $ 39,477 $ 40,846 $ 155,017 Commercial Fiber 8,359 8,376 7,308 8,716 32,759 RLEC & Other 4,419 4,072 3,925 4,155 16,571 Total Revenue 49,787 50,133 50,710 53,717 204,347 2019 Residential
Slide 30: Broadband Data Revenue Generating Units (RGUs)
Broadband Data Revenue Generating Units (RGUs) Incumbent Beam Total Cable Glo Fiber Wireless Broadband 2020 Beginning RGUs 83,919 126 — 84,045 Other Net Additions 14,636 4,032 99 18,767 Ending RGUs 98,555 4,158 99 102,812 2019 Beginning RGUs 75,389 — — 75,389 Acquired RGUs 2,211 — — 2,211 Other Net
Slide 31: Broadband Video Revenue Generating Units (RGUs)
Broadband Video Revenue Generating Units (RGUs) Incumbent Beam Total Cable Glo Fiber Wireless Broadband 2020 Beginning RGUs 53,637 36 — 53,673 Other Net Additions (1,898) 1,042 — (856) Ending RGUs 51,739 1,078 — 52,817 2019 Beginning RGUs 58,672 — — 58,672 Acquired RGUs 1,723 — — 1,723 Other Net Add
Slide 32: Broadband Voice Revenue Generating Units (RGUs)
Broadband Voice Revenue Generating Units (RGUs) Incumbent Beam Total Cable Glo Fiber Wireless Broadband 2020 Beginning RGUs 31,365 15 — 31,380 Other Net Additions 672 594 — 1,266 Ending RGUs 32,037 609 — 32,646 2019 Beginning RGUs 29,474 — — 29,474 Acquired RGUs 855 — — 855 Other Net Additions 1,036
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