Shenandoah Telecommunications Company Reports First Quarter 2022 Results
EDINBURG, Va., April 28, 2022 (GLOBE NEWSWIRE) -- Shenandoah Telecommunications Company (“Shentel”) (Nasdaq: SHEN) announced first quarter 2022 financial and operating results.
- Revenue grew 7.9% to $64.4 million over the same period a year ago.
- Broadband data net adds were approximately 3,600 including 2,400 for Glo Fiber.
- Glo Fiber homes and businesses passed grew sequentially 18,000 to approximately 94,000.
“We are pleased with our progress in executing our fiber first broadband strategy with another record quarter for Glo Fiber net adds and passings” said President and CEO, Christopher E. French. "Although top line revenue growth was solid, increases in our operating expenses adversely impacted margins as we improved employee compensation and upgraded our back-office systems. We expect margin improvements in the second half of 2022 as we implement our cost savings initiatives to drive costs out of the business."
Shentel's first-quarter earnings conference call will be webcast at 8:00 a.m.ET on Friday, April 29, 2022. The webcast and related materials will be available on Shentel’s Investor Relations website at https://investor.shentel.com/
Consolidated First Quarter 2022 Results
- Revenue in the first quarter of 2022 grew 7.9% to $64.4 million, compared with the first quarter of 2021, due to revenue growth of 8.3% in the Broadband segment and 3.9% in the Tower segment.
- Loss from continuing operations per share was $(0.01) in the first quarter of 2022 compared with income per share from continuing operations of $0.06 the first quarter of 2021 due primarily to higher stock compensation expense.
- Adjusted EBITDA in the first quarter of 2022 grew 2.4% to $17.4 million, compared with the first quarter of 2021, due primarily to 18.2% lower Corporate expenses from lower compensation expenses from the 2021 reduction in force and lower professional fees.
- Total broadband data Revenue Generating Units ("RGUs") as of March 31, 2022, were 122,753, representing 14.1% year over year growth. Penetration for incumbent cable, Glo Fiber and Beam were 51%, 15% and 6%, respectively, compared to 48%, 16% and 3%, respectively, as of March 31, 2021. Total Glo Fiber and Beam passings grew year over year by approximately 59,200 and 12,400, respectively.
- Broadband revenue in the first quarter of 2022 grew $4.6 million or 8.3% to $59.7 million compared with $55.2 million in the first quarter of 2021, primarily driven by a $4.0 million or 9.3% increase in Residential and Small and Medium Business ("SMB") revenue on a 14.1% increase in broadband data RGUs.
- Cost of services increased approximately $2.9 million, or 13.0%, compared with the three months ended March 31, 2021, driven by higher maintenance and compensation expenses. Maintenance increased due to higher cable replacement costs, higher gasoline, field engineering and software costs. Compensation increased due to higher headcount to support the expansion of our Glo Fiber network, salary and wage increases and higher medical benefit costs.
- Selling, general and administrative expense increased $2.8 million, or 25.8%, compared with the three months ended March 31, 2021, driven primarily by a $1.0 million increase in compensation, $0.7 million in software and professional service fees due to upgrades to our ERP, OSS and CRM systems, and $0.5 million in advertising to support Glo Fiber expansion. Compensation costs increased due primarily to increased headcount to support the expansion of Glo Fiber, salary and wage increases and higher medical benefit costs.
- Depreciation and amortization increased $1.1 million or 9.5%, compared with the three months ended March 31, 2021, primarily as a result of our network expansion of our Glo Fiber network.
- Broadband Operating income in the first quarter of 2022 was $8.2 million, compared to $10.3 million in the first quarter of 2021.
- Broadband Adjusted EBITDA in the first quarter of 2022 decreased 5.4% to $21.1 million, compared with $22.3 million for the first quarter of 2021.
- Tower revenue in the first quarter of 2022 increased 3.9% to $4.8 million compared with the first quarter of 2021. Tenants increased 5.6% to 468 partially offset by 3.6% decline in average lease revenue per tenant.
- Tower operating income in the first quarter of 2022 was $2.8 million, compared to $2.7 million in the first quarter of 2021.
- Tower Adjusted EBITDA in the first quarter of 2022 was consistent with the first quarter of 2021 at $3.2 million for both periods.
- As of March 31, 2022 our cash and cash equivalents totaled $54.0 million and the availability under our revolving line of credit and delay draw term loans were $400.0 million, for total available liquidity of $454.0 million.
- Capital expenditures were $45.7 million for the three months ended March 31, 2022 compared with $39.5 million in the comparable 2021 period. The $6.2 million increase in capital expenditures was primarily due to higher spending in the Broadband segment driven by the expansion of our Glo Fiber network.
Conference Call and Webcast
Date: April 29, 2022
Time: 8:00 A.M. (ET)
Dial in number: 1-888-695-7639
An audio replay of the call will be available approximately two hours after the call is complete, through May 29, 2022 by calling (855) 859-2056.
About Shenandoah Telecommunications
Shenandoah Telecommunications Company (Shentel) provides broadband services through its high speed, state-of-the-art cable, fiber optic and fixed wireless networks to customers in the Mid-Atlantic United States. The Company’s services include: broadband internet, video, and voice; fiber optic Ethernet, wavelength and leasing; and tower colocation leasing. The Company owns an extensive regional network with over 7,600 route miles of fiber and over 220 macro cellular towers. For more information, please visit www.shentel.com.
This release contains forward-looking statements about Shentel regarding, among other things, its business strategy, its prospects and its financial position. These statements can be identified by the use of forward-looking terminology such as “believes,” “estimates,” “expects,” “intends,” “may,” “will,” “should,” “could,” or “anticipates” or the negative or other variation of these or similar words, or by discussions of strategy or risks and uncertainties. The forward-looking statements are based upon management’s beliefs, assumptions and current expectations and may include comments as to Shentel’s beliefs and expectations as to future events and trends affecting its business that are necessarily subject to uncertainties, many of which are outside Shentel’s control. Although management believes that the expectations reflected in the forward-looking statements are reasonable, forward-looking statements are not, and should not be relied upon as, a guarantee of future performance or results, nor will they necessarily prove to be accurate indications of the times at which such performance or results will be achieved, and actual results may differ materially from those contained in or implied by the forward-looking statements as a result of various factors. A discussion of other factors that may cause actual results to differ from management’s projections, forecasts, estimates and expectations is available in Shentel’s filings with the Securities and Exchange Commission. Those factors may include natural disasters, pandemics and outbreaks of contagious diseases and other adverse public health developments, such as COVID-19, changes in general economic conditions including high inflation, increases in costs, changes in regulation and other competitive factors. The forward-looking statements included are made only as of the date of the statement. Shentel undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events, except as required by law.
Shenandoah Telecommunications Company
Senior Vice President and Chief Financial Officer