Shenandoah Telecommunications Co · NASDAQ:SHEN
Shenandoah Telecommunications — Q2 2021 Earnings Presentation
27 slides from Shenandoah Telecommunications's earnings presentation, Jul 30, 2021
Slide 1: Q2 2021 Earnings Conference Call
Q2 2021 Earnings Conference Call July 30, 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: Successful Transformation
Successful Transformation a Completed $1.94 billion sale of Wireless assets and operations to T-Mobile on July 1 a Repaid $681 million of outstanding term loans and terminated credit agreement on July 1 a Declared $18.75 per share special dividend payable on August 2 a Announced a new $400 million f
Slide 5: Growing Broadband Network
Growing Broadband Network Broadband Data Homes and Businesses Passed 278,952 259,891 21,797 246,790 15,240 230,002 9,447 46,368 220,442 34,441 28,652 22,347 13,173 207,269 207,655 208,691 210,210 210,787 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Incumbent Cable Glo Fiber Beam Wireless 5
Slide 6: Solid Broadband Results
Solid Broadband Results Broadband Data Net Additions 6,028 6,069 878 1,471 4,245 4,048 3,906 370 372 1,356 1,366 1,645 5,150 4,598 2,593 2,509 1,889 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Incumbent Cable Glo Fiber Beam Wireless Q1'21 excludes 512 acquired data RGUs from net additions 6
Slide 7: Jim Volk, SVP of Finance and CFO
Jim Volk SVP of Finance and CFO 7
Slide 8: Broadband Highlights - Second Quarter Results
Broadband Highlights - Second Quarter Results Revenue (in millions) Adjusted OIBDA (in millions) Residential & SMB Commercial Fiber 2.5% $20.3 RLEC & Other $19.8 $56.2 12.2% $3.7 $50.1 $4.0 $8.5 $8.4 39.5% 36.1% margin margin $44.0 $37.7 Q2'20 Q2'21 Q2'20 Q2'21 8
Slide 9: Tower Highlights - Second Quarter Results
Tower Highlights - Second Quarter Results Revenue (in millions) Adjusted OIBDA (in millions) $4.6 8.3% $4.3 9.3% $3.0 $2.7 63.5% 64.1% margin margin Q2'20 Q2'21 Q2'20 Q2'21 9
Slide 10: Consolidated Highlights - Second Quarter Results
Consolidated Highlights - Second Quarter Results Revenue (in millions) Adjusted OIBDA (in millions) 11.7% $60.7 $4.6 29.6% $54.3 $16.3 $12.6 $4.3 $3.0 $2.7 $19.8 $20.3 $56.2 $50.1 $(7.0) $(10.0) Q2'20 Q2'21 Q2'20 Q2'21 Broadband Tower Broadband Tower Corporate Consolidated revenue includes eliminati
Slide 11: Consolidated 2021 Outlook
Consolidated 2021 Outlook Revenue (in millions) Adjusted OIBDA (in millions) $241 - $248 10.6% $17 - $18 27.2% $220.8 $69 - $76 $57.2 $10.5 - $11.5 $17.1 $10.7 $90 - $94 $224 - $230 $81.5 $204.3 $(35.0) $(31.5) - $(29.5) 2020 2021 Guidance 2020 2021 Guidance Broadband Tower Broadband Tower Corporate
Slide 12: Pro Forma Liquidity Changes
Pro Forma Liquidity Changes ($ in millions) $(470) $(681) $1,944 $(937) $400 $483 $249 $(22) Cash & Cash Sale Taxes Debt Payoff Special Transaction New New Liquidity Equivalents Proceeds Dividend Fees/Swap financing @6/30/21 Payoff 12
Slide 13: New Financing Terms
New Financing Terms • $400 million Senior Secured Credit Facilities (“Credit Facilities”) CREDIT ◦ $100 million Revolving Credit Facility (“Revolver”) FACILITIES: ◦ $150 million Delayed Draw Term Loan A-1 (“DDTL A-1”) ◦ $150 million Delayed Draw Term Loan A-2 (“DDTL A-2”) INCREMENTAL • The sum of (a
Slide 14: Ed McKay, EVP and COO
~~. EVP and COO AXSHENTEL
Slide 15: Unique network platform with high growth potential
Unique network platform with high growth potential Greenfield fixed wireless Shentel position Incumbent Greenfield fiber overbuilder broadband overbuilder Higher density tier III / IV Market type Various, but mostly rural Low density rural markets Target market dynamic Current / 2026 Target 211,000
Slide 16: Integrated Fiber, Cable and Fixed Wireless Broadband Network
Integrated Fiber, Cable and Fixed Wireless Broadband Network 16
Slide 17: Broadband - Incumbent Cable Metrics
Broadband - Incumbent Cable Metrics Revenue Generating Units (RGU) Broadband Data Average Revenue per User (ARPU) $77.94 $78.48 Voice Broadband Data Video 176,146 186,777 52,738 49,708 91,364 103,465 32,044 33,604 Q2'20 Q2'21 Q2'20 Q2'21 Broadband Data Penetration Broadband Data Churn 1.59% 49.1% 1.
Slide 18: Broadband - Glo Fiber Metrics
Broadband - Glo Fiber Metrics Revenue Generating Units (RGU) Broadband Data Average Revenue per User (ARPU) $82.72 Voice Broadband Data $73.66 Video 9,876 1,647 7,169 1,954 1,331 1,060 Q2'20 Q2'21 Q2'20 Q2'21 Broadband Data Penetration Broadband Data Churn 1.15% 15.5% 0.67% 10.1% Q2'20 Q2'21 Q2'20 Q
Slide 19: Glo Fiber Market Update
Glo Fiber Market Update Passings Penetration Released to Target as of Sales Passings* Launch Date 6/30/2021 Harrisonburg VA 10.4k 13.3k October 2019 22.4% Staunton VA 10.4k 10.6k February 2020 20.2% Front Royal VA 5.1k 5.2k March 2020 16.1% Winchester VA** 8.5k 23.9k March 2020 13.2% Salem VA 4.4k 8
Slide 20: Broadband - Beam Broadband Data Metrics
Broadband - Beam Broadband Data Metrics Revenue Generating Units (RGU) Average Revenue per User (ARPU) 841 $73.14 $72.22 469 Q1'21 Q2'21 Q1'21 Q2'21 Penetration Churn 0.99% 1.02% 3.9% 3.1% Q1'21 Q2'21 Q1'21 Q2'21 20
Slide 21: Tower - Metrics
Tower - Metrics Towers Tenants Intercompany Carriers 220 223 448 413 209 207 239 206 Q2'20 Q2'21 Q2'20 Q2'21 Intercompany leases assumed by T-Mobile 7/1/2021 21
Slide 22: Capital Expenditures
Capital Expenditures Capex Spending ($ in millions) $157 - $168 162500000 $2 - $3 $100 - $105 $80 $53 $51 $20 $55 - $60 $31 $27 2020 2021 2021 Guidance Broadband* Glo Fiber & Beam Tower Other *Excludes CapEx for Glo Fiber and Beam Fixed Wireless 22 2020 and 2021 actuals reflect Q2 YTD results
Slide 23: Q&A
AXSHENTEL Q&A 23
Slide 24: Appendix
Appendix AXSHENTEL
Slide 25: 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 26: Adjusted OIBDA by Segment - Quarterly Results
Adjusted OIBDA by Segment - Quarterly Results Three Months Ended June 30, 2021 Corporate (in thousands) Broadband Tower & Other Consolidated Operating income (loss) from continuing operations $ 8,492 $ 2,509 $ (8,298) $ 2,703 Depreciation 11,577 449 1,075 13,101 Amortization 198 — — 198 OIBDA 20,267
Slide 27: Broadband - Average Revenue per User (ARPU)
Broadband - Average Revenue per User (ARPU) For the second quarter ended, 2020 2021 Residential & SMB Revenue (000's) Broadband $ 21,003 $ 25,714 Incumbent Cable $ 20,802 $ 24,177 Glo Fiber $ 201 $ 1,394 Beam Wireless $ — $ 143 Video $ 14,938 $ 15,611 Voice $ 2,808 $ 2,893 Average Revenue Generating
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