Shenandoah Telecommunications Co · NASDAQ:SHEN
Shenandoah Telecommunications — Drexel Hamilton Conference (September 2015)
21 slides from Shenandoah Telecommunications's conference presentation, Sep 10, 2015
Slide 1: Shenandoah Telecommunications Company - Drexel Hamilton Conference
Shenandoah Telecommunications CompanyDrexel Hamilton ConferenceSeptember 10, 2015 NASDAQ: SHEN Exhibit 99.1
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, among other things, our business strategy, our prospects and our financial position. Th
Slide 3: 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 US generally accepted accounting principles. These financial performance measures are not indicative of cash provided or used by operating activities an
Slide 4: Company Overview
Company Overview Diverse Revenue Streams 3 complementary revenue streams: Wireless, Cable and Wireline All divisions are OIBDA positiveTower Leasing Business Provides Steady Recurring Cash FlowWe own 154 towers with an average of 2.3 tenants each Fiber We control 4,429 route miles of fiberWriting $1
Slide 5: External Revenues by Segment
External Revenues by Segment ($ in thousands) Annualized based on YTD actuals disclosed in Q2’15 earnings releases for Shentel and nTelos (Western Markets). For illustrative purposes only. Not indicative of future results.
Slide 6: Net Income
Net Income ($ in millions) Annualized based on YTD actuals disclosed in Q2’15 earnings releases for Shentel and nTelos (Western Markets). For illustrative purposes only. Not indicative of future results.
Slide 7: Adjusted OIBDA
Adjusted OIBDA ($ in millions) Shentel estimate is annualized based on actuals disclosed in Shentel’s 6/30/15 Form 10-Q. nTelos Western Market estimate is based on guidance of $100-108 million in its Q2’15 earnings release. For illustrative purposes only. Not indicative of future results.
Slide 8: Existing Wireless Network Overview
One of only 2 Sprint affiliates 2.2 million covered POPs442k total subscribers20% penetration of covered POPs546 base stations Existing Wireless Network Overview 4G LTE Depth: 2nd carrier 3rd carrier November 2013 - 527 sites 0% 0% December 2014 - 538 sites 92% 22% June 2015 - 546 sites 94% 30%
Slide 9: Pro Forma Network Following nTelos Acquisition
Pro Forma Network Following nTelos Acquisition Shentel Coverage Overlap Coverage NTELOS Coverage Shentel Cable Coverage 4.3 million covered POPs1 million total subscribers24% penetration of covered POPs1,408 base stations after elimination of 148 redundant sites
Slide 10: Postpaid Settlement through 12/31/15
Postpaid Settlement through 12/31/15 SPRINT PROVIDES Net Service FeeBilling/CollectionsCustomer CareLong DistanceTravel/RoamingNational DistributionEquipment FinancingPayment = 14% of Net Billings Management FeeSpectrumBrandNational PlatformAccess to Sprint vendorsPayment = 8% of Net Billings SHENTE
Slide 11: Attractive Contract With Sprint
Attractive Contract With Sprint (rates effective 1/1/16) Initial contract term extended from 2024 to 2029Two 10-year renewalsPayment at termination from 80% of EBV to 90%Postpaid Sprint fees down from 22% to 16.6% Fee (Management: 8%; Service: 8.6%), with a cap of 18% for 2017. Could increase should
Slide 12: Shentel Wireless Subscriber Growth
AXSHENTEL Wireless Subscriber Growth ™ Postpaid % Sprint/nTelos id 1,200,000 Postpaid ™ Prepaid @ Sprint/nTelos Prepaid* 1,000,000 800,000 600,000 /) 400,000 200,000 0 > ah 40 \) sy Cg s CJ © x AS AS Ay AS FES ES EFSF ES SILL LS Ms S * Subscriber counts include both nTelos and Sprint subscribers tha
Slide 13: Expansion of Wireless Subscriber Base With nTelos and Sprint's subscribers
Expansion of Wireless Subscriber Base With nTelos and Sprint’s subscribers Shentel will:Increase its wireless subscriber base by more than 2.3xThe combined business is expected to have a wireless customer mix of:70% Postpaid30% PrepaidThe transactions position Shentel as the 6th largest public wirel
Slide 14: Net Transaction Consideration
Net Transaction Consideration As of June 30, 2015 (1)
Slide 15: Planned Operational Initiatives
Planned Operational Initiatives Network Complete the wind down of nTelos’ Eastern MarketsComplete the 4G LTE build-out and deploy 800 MHz spectrum for voice and LTERemove 148 duplicate sitesAdd 150 coverage sitesDeploy 2.5 GHz spectrumLeverage Shentel fiber network for backhaul Customer Service Migr
Slide 16: Financing Details
Financing Details Financing Structure Purchase price fully funded by $960 million in committed debt financing including:$485 million five-year Term Loan A-1 with amortization of 5% in year 1, 10% in years 2 to 4 and 15% in the final year $400 million seven-year Delayed Draw Term Loan A-2 ($325 milli
Slide 17: Cable Network Homes Passed
172K Video Homes Passed*172K Internet Homes Passed169K Voice Homes Passed WV VA MD PA Cable Network * Excludes 16,000 homes passed in Shenandoah County, VA which are included in the wireline segment
Slide 18: Cable - RGU Growth
Cable - RGU Growth Customers 67,093 68,553 68,385 69,538 71,298 71,469 RGU's/Customer 1.43 1.52 1.58 1.64 1.71 1.73 Chart excludes Video only customers in Shenandoah County, VA
Slide 19: Increasing Average Monthly Cable Revenue
Increasing Average Monthly Cable Revenue Average Monthly Revenue per RGU Average Monthly Revenue per Customer
Slide 20: Investing in the Future: Capex Spending
Investing in the Future Capex Spending ($ millions) * Accounts payable at December 31, 2013 and 2012 included $6.5 million and $24.7 million associated with PCS Network Vision capital expenditures.
Slide 21: Q&A
AXSHENTEL Q&A
Shenandoah Telecommunications — Drexel Hamilton Conference (September 2015) on 6ix