Shenandoah Telecommunications Co · NASDAQ:SHEN
Shenandoah Telecommunications — Shareholder Meeting (May 2007)
32 slides from Shenandoah Telecommunications's shareholder meeting presentation, May 2, 2007
Slide 1: 2007 Annual Shareholders Meeting
2007 ANNUAL SHAREHOLDERS MEETING Presentation by: Christopher E. French President SHENANDOAH TELECOMMUNICATIONS COMPANY Exhibit 99.1
Slide 2: Comparative Results
Comparative Results (in millions, except per share amounts) 0.75 2.30 17.9 21.2 169.2 63.0 0.46 Cash Dividend (per share) 65.5 1.39 EPS – diluted 67.3 10.7 Total Net Income 9.3 19.4 Operating Income 15.6 146.4 Revenues Percent Change
Slide 3: 8,753 2005 2006 19997 | s 2573) s (4,359) “oY SHENTEL
8,753 2005 2006 19997 20 | s 2573) s (4,359) “oY SHENTEL
Slide 4: Amendment to PCS Agreements: CDMA network
Continue to own and operate CDMA network Amendment to PCS Agreements Continue to have responsibility for sales and customer support Retains same term: 20 years, plus three 10- year renewal periods No mandated upgrades to CDMA network
Slide 5: Sprint Nextel retains iDEN network and its revenues
Sprint Nextel retains iDEN network and its revenues Transfer to Shentel the Nextel stores and employees in Shentel’s PCS service area Shentel to sell iDEN products and services and provide local iDEN customer service Amendment to PCS Agreements
Slide 6: Resolve all outstanding claims between Sprint Nextel and Shentel
Resolve all outstanding claims between Sprint Nextel and Shentel Provide a greatly simplified, long-term plan for settling revenues and expenses Changes to presentation of financial information Amendment to PCS Agreements
Slide 7: Settlement Simplification: Previous Method
Settlement Simplification Previous Method
Slide 8: Settlement Simplification: New Method
Settlement Simplification New Method
Slide 9: Organization Review
Organization Review Identified need to reduce cost structure Freeze and termination of pension plan Reduction in Force One time costs of $2.5 million for downsizing Another $1.7 million to recognize for termination of pension plan Projected annual savings of $2.8 million
Slide 10: Federal Issues
Federal Issues Exclusive Access Contracts for Video Service Net Neutrality Intercarrier Compensation Universal Service Fund Access Rate Reduction
Slide 11: Broadband Alternatives
Broadband Alternatives
Slide 12: Preston Lake, Virginia
~ NN preston lake VIRGINIA “0 SHENTEL
Slide 13: HDTV service from Shentel Cable
Ba Weghew in January 2007 _ HDTV service tom Shentel Cable“ KT Don't just watch Tv — EXPERIENCE it sina — © SHENTEL
Slide 14: Shareholders
Shareholders - 2,008 shareholder accounts (almost all retail) - 469,995 shares outstanding - Approximate market capitalization $17.4 million (based on average reported sale price for year) - 4,143 shareholder accounts (retail and institutional) - 7,761,428 shares outstanding - Approximate market cap
Slide 15: Shenandoah Telecommunications vs. NASDAQ indexes
150 +- 100 +- 2001 2002 2003 2004 2005 2006 —¢-SHENAND OAH TELECOMMUNICATIONS COMPANY —#- NASDAQ U.S. INDEX -®— NASDAQ TELECOMMUNICATIONS INDEX ‘SHENTEL
Slide 16: 2007 Annual Shareholders Meeting
2007 ANNUAL SHAREHOLDERS MEETING Presentation by: Earle A. MacKenzie EVP and COO SHENANDOAH TELECOMMUNICATIONS COMPANY
Slide 17: Comparative Results
Comparative Results (in millions, except EPS) $2.30 $11.5 $17.9 65.5 7.5 $1.39 $10.7 Earnings Per Share (EPS) Consolidated Net Income * 67.3 $10.7 Consolidated Net Income % Change * Excluding $6.4 gain on liquidation of Rural Telephone Bank
Slide 18: Operating Income Results
Operating Income Results (in millions) $ 21.2 148.0 $169.2 9.3 $ 19.4 Operating Income 16.5 127.0 Operating Expense 15.6 $146.4 Revenue % Change
Slide 19: Reporting Segments: Revenue
Reporting Segments Revenue (in millions) $169.2 $115.4 24.7 10.7 3.6 14.8 15.6 $146.4 Total 22.2 0.0 9.2 9.1 5.0 $ 94.4 24.7 9.8 3.3 14.1 PCS Telephone Converged Services (NTC) Mobile Other % Change
Slide 20: Year End Customers
) ) ) Year End Customers % Change PCS 24.8 122,975 153,503 Retail 27.5 38,726 49,378 Wholesale (54.7) 9,914 4,492 Phone 6.2 8,461 8,989 Video Converged Services (NTC) (4.2) 22,901 21,943 Network
Slide 21: Year End Customers
) Year End Customers % Change 0.4 24,740 24,830 Telephone (21.0) 12,498 9,869 Dial Up 0.7 Mobile/Tower Leases - Non Affiliates 39.0 4,748 6,599 DSL Internet 0.8 10,418 10,499 Long Distance (2.8) 8,684 8,440 Cable
Slide 22: Operating Expenses
Operating Expenses (in millions) Total Selling, General & Admin. Depreciation & Amortization Cost of Goods & Services 16.5 $127.0 $148.0 10.8 44.3 49.1 21.9 22.4 27.3 18.7 $60.3 $71.6 % Change
Slide 23: Reporting Segments: Net Income
) ) ) ) ) ) Reporting Segments Net Income (in millions) * 7.5 $10.7 $11.5 Total 250.0 ( 0.4 ) ( 1.4 ) Other 9.1 1.1 1.0 Mobile 75.8 (3.3) (5.8) Converged Services (NTC) 12.7 7.9 8.9 Telephone 63.0 $ 5.4 $ 8.8 PCS % Change * Excludes $6.4 net of tax gain on liquidation of Rural Telephone Bank.
Slide 24: Major Points of New Sprint Nextel Agreement
MAJOR POINTS OF NEW SPRINT NEXTEL AGREEMENT Effective retroactive to January 1, 2007 Provides more certainty in projecting future results
Slide 25: Major Points
Major Points Take over 13 Nextel Stores that will be branded Sprint Approximately 30 Sprint Nextel employees will join Shentel in May Will provide local customer service to Nextel customers and sell iDEN products and services in all of our stores and agent locations
Slide 26: Major Points
Major Points With more locations we anticipate even faster growth in PCS customers Anticipate adding additional employees Potential opportunity to participate in additional ventures with Sprint Nextel
Slide 27: Q1 Results - Net Income
) ) ) ) ) ) Q1 Results-Net Income (in millions) 40.0 95.2 (0.5) $ 2.1 * ( 0.7 ) $4.1 Other Total 0.3 0.2 Mobile 0.0 (33.3) (1.2) (1.2) Converged Services (NTC) (31.8) 2.2 * 1.5 * Telephone 230.8 $1.3 $4.3 PCS Q1 % Change Q1 *Excludes $6.4 million net of tax gain from liquidation of the Rural Telepho
Slide 28: Q1 Results - Operating Income
) ) ) ) ) ) ) ) ) ) ) Q1 Results Operating Income (in millions) 69.0 $4.2 $7.1 Total 50.0 (0.8) ( 1.2 ) Other 0.0 0.5 0.5 Mobile (6.3) (1.6) (1.7) Converged Services (NTC) (37.1) 3.5 2.2 Telephone 180.8 $2.6 $7.3 PCS Q1 % Change Q1
Slide 29: Q1 Results - Revenue
) ) Q1 Results Revenue (in millions) (24.8) (4.8) (3.6) 11.1 0.0 (17.1) $26.2 6.3 2.8 0.9 3.6 $39.8 $19.7 6.0 2.7 1.0 3.6 $33.0 PCS Telephone Converged Services (NTC) Mobile Other Total Q1 % Change Q1
Slide 30: PCS
) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) PCS $4.7 $2.6 $7.3 Operating Income (5.1) ($11.2) 8.0 $23.6 2.9 $12.4 Selling, General and Administrative 0.2 3.5 3.7 Depreciation ($6.3) $12.1 $5.8 Cost of Good and Services Expenses ($6.5) $26.2 $19.7 0.1 0.3 0.4 Other 0.1 1.0 1.1 Equipment Sales (
Slide 31: Disclosure Regarding Forward-Looking Statements
Disclosure Regarding Forward-Looking Statements 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
Slide 32: 2007 Annual Shareholders Meeting
2007 ANNUAL SHAREHOLDERS MEETING SHENANDOAH TELECOMMUNICATIONS COMPANY
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