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Windstream Reports Third-Quarter 2019 ResultsWindstream (News - Alert) Holdings, Inc., a leading provider of advanced network communications and technology solutions, today reported third-quarter results. Windstream grew its Kinetic broadband customer base for the sixth consecutive quarter, adding 5,700 new subscribers. The company has added approximately 19,000 new broadband subscribers year-to-date, a 126 percent increase year-over-year. The company continues to rapidly expand its broadband capabilities. Today, 70 percent of households across its largely rural footprint have access to Internet speeds of 25 Mbps or greater and 41 percent of households can receive speeds of 100 Mbps or greater. Enterprise strategic sales also continued to accelerate, representing approximately 65 percent of total Enterprise sales during the third quarter. Sales of strategic products and services, including SD-WAN, UCaaS and OfficeSuite UC®, now represent an annualized run-rate of $290 million in revenue and are growing at approximately 41 percent year-over-year. "Windstream continues to execute on our operational priorities and remains focused on taking care of our customers during the restructuring process. In the third quarter, we once again delivered broadband customer growth in our Kinetic business unit and grew sales of our Enterprise strategic products. I am proud of the continued focus of our team and appreciate the support of all of our stakeholders as we work through the restructuring process," said Tony Thomas, president and chief executive officer of Windstream. Restructuring Update Windstream remains focused on securing a result that maximizes value for all of the company's stakeholders. As part of the restructuring process, the company continues to work through mediation to modify its arrangement with Uniti Group, Inc. Pursuant to a confidentiality agreement associated with the ongoing mediation, the company is unable to provide any additional information regarding the process at this time. Absent an acceptable negotiated resolution, Windstream is prepared to pursue its litigation claims to conclusion. The trial is currently scheduled to begin the first week of March. Adjusted Results of Operations Adjusted total revenues and sales were $1.27 billion compared to $1.38 billion in the same period a year ago. Adjusted total service revenues were $1.24 billion compared to $1.36 billion year-over-year. Adjusted OIBDAR was $423 million compared to $457 million in the same period a year ago. Adjusted OIBDAR margin was 33 percent, an increase of 20 basis points year-over-year as cash expenses declined by 8 percent year-over-year. Adjusted capital expenditures were $221 million compared to $188 million in the same period a year ago. The company's available liquidity as of Sept. 30, 2019, was $885 million. Kinetic service revenues were $506 million compared to $525 million in the same period a year ago, and segment contribution margin was $287 million compared to $308 million year-over-year. Enterprise service revenues were $650 million compared to $737 million in the same period a year ago, and segment contribution margin was $126 million compared to $145 million year-over-year. Wholesale service revenues were $86 million compared to $96 million in the same period a year ago, and segment contribution margin was $66 million compared to $68 million year-over-year. Note: Adjusted OIBDAR is Adjusted OIBDA before the annual cash payment due under the arrangement with Uniti. Adjusted OIBDA is operating income (loss) before depreciation and amortization and goodwill impairment, excluding straight-line expense under the arrangement with Uniti, share-based compensation expense, restructuring charges, merger, integration and certain other costs. Adjusted capital expenditures exclude post-merger integration capital expenditures for Broadview Network Holdings, Inc. and EarthLink Holdings Corp. Adjusted OIBDAR and Adjusted OIBDA also exclude the operating results of the Consumer CLEC business sold on Dec. 31, 2018. Financial results under Generally Accepted Accounting Principles (GAAP) were not disclosed while the company evaluates the accounting treatment for the Uniti arrangement. Regardless of the accounting treatment for the Uniti arrangement, the company's key non-GAAP financial metrics of Adjusted OIBDAR, Adjusted OIBDA, Adjusted Capital Expenditures and Adjusted Free Cash Flow would not change. Management Webcast Management has provided pre-recorded remarks on the company's results via webcast on the company's investor relations website at investor.windstream.com. Financial, statistical and other information related to the remarks also are posted on the site. About Windstream Windstream Holdings, Inc., a FORTUNE 500 company, is a leading provider of advanced network communications and technology solutions. Windstream provides data networking, core transport, security, unified communications and managed services to mid-market, enterprise and wholesale customers across the U.S. The company also offers broadband, entertainment and security services for consumers and small and medium-sized businesses primarily in rural areas in 18 states. Services are delivered over multiple network platforms including a nationwide IP network, our proprietary cloud core architecture and on a local and long-haul fiber network spanning approximately 150,000 miles. Additional information is available at windstream.com or windstreamenterprise.com. Please visit our newsroom at news.windstream.com or follow us on Twitter (News - Alert) at @Windstream. Cautionary Statement Regarding Forward Looking Statements Windstream claims the protection of the safe-harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for this press release. This release contains various forward-looking statements which represent our expectations or beliefs concerning future events, including, without limitation, our future performance, our ability to comply with the covenant in the agreements governing our indebtedness and the availability of capital and terms thereof; projections regarding our 2019 financial plan; certain revenue and contribution margin trends in our business units; expected sales growth and opportunities in strategic products and services and expansion of these products for our small and medium sized business customers; increasing broadband penetration levels and availability of faster broadband speeds to more households and businesses within our service areas; benefits of Project Excel and other activities to drive broadband speeds; expected net growth of our broadband subscribers; anticipated fixed wireless offerings based on recent trials; anticipated results and funding opportunities related to the Rural Digital Opportunity Fund and the current CAF II program, both administered by the Federal Communications Commission; statements concerning the current arrangement and related payments to Uniti Group, Inc.; expectations regarding expense management activities, including interconnection expense, and the timing and benefit of such activities; and any other statements regarding plans, objectives, expectations and intentions and other statements that are not historical facts. Statements expressing expectations and projections with respect to future matters are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We caution that these forward-looking statements involve a number of risks and uncertainties and are subject to many variables which could impact our future performance. These statements are made on the basis of management's views, estimates, projections, beliefs, and assumptions, as of the time the statements are made, regarding future events and results. There can be no assurance, however, that management's expectations will necessarily come to pass. Actual future events and our results may differ materially from those expressed in these forward-looking statements as a result of a number of important factors. A wide range of factors could cause actual results to differ materially from those contemplated in our forward-looking statements, including, but not limited to:
In addition to these factors, actual future performance, outcomes and results may differ materially because of more general factors including, among others, general industry and market conditions and growth rates, economic conditions, and governmental and public policy changes. Windstream undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The foregoing review of factors that could cause Windstream's actual results to differ materially from those contemplated in the forward-looking statements should be considered in connection with information regarding risks and uncertainties that may affect Windstream's future results included in other filings with the Securities and Exchange Commission at www.sec.gov. View source version on businesswire.com: https://www.businesswire.com/news/home/20191107005525/en/ |