Attached files
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| 8-K - FORM 8-K - Enventis Corp | form8k.htm |
Exhibit 99.1
Annual Shareholder Meeting
May 17, 2011
May 17, 2011
Information set forth in this presentation contains financial estimates
and other forward-looking statements that are subject to risks and
uncertainties; therefore, actual results might differ materially from such
statements, whether as a result of new information, future events or
otherwise. You are cautioned not to place undue reliance on these
forward-looking statements. A discussion of factors that may effect
future results is contained in HickoryTech’s filings with the Securities
and Exchange Commission. HickoryTech disclaims any obligation to
update and revise statements contained in this presentation based on
new information or otherwise. This presentation also contains certain
non-GAAP financial measures. Reconciliations of these non-GAAP
measures to the most directly comparable GAAP measures will be
available in our presentation to be filed with the SEC.
and other forward-looking statements that are subject to risks and
uncertainties; therefore, actual results might differ materially from such
statements, whether as a result of new information, future events or
otherwise. You are cautioned not to place undue reliance on these
forward-looking statements. A discussion of factors that may effect
future results is contained in HickoryTech’s filings with the Securities
and Exchange Commission. HickoryTech disclaims any obligation to
update and revise statements contained in this presentation based on
new information or otherwise. This presentation also contains certain
non-GAAP financial measures. Reconciliations of these non-GAAP
measures to the most directly comparable GAAP measures will be
available in our presentation to be filed with the SEC.
Safe Harbor Statement
Dale Parker
Board Chairman
Welcome
Agenda
Board of Directors
Business Meeting
Proposals
• Ratification of Grant Thornton as the company’s
independent accounting firm and auditor for 2011
independent accounting firm and auditor for 2011
John Finke
President and CEO
Business Overview
Executive Team
Video
Building a Business & Broadband
Communications Company
Communications Company
Expanded fiber network includes
2,750 fiber route miles
2,750 fiber route miles
• Expanded route to Sioux Falls and Fargo
• Expanded network capacity in Des Moines
and backhaul to Minnesota
and backhaul to Minnesota
• Secured broadband stimulus grant
Project will add 400 route miles
Project will add 400 route miles
HickoryTech Fiber Network
Fiscal 2010 compared to fiscal 2009:
• Consolidated revenue +17%
o Business Sector revenue +34%
Fiber and Data revenue +43%
Equipment revenue +27%
o Telecom Sector revenue flat
Broadband revenue +11%
Surpassed 10,000 Digital TV subscribers
Surpassed 10,000 Digital TV subscribers
• Extended fiber network to the Dakotas,
built fiber network in Des Moines, upgraded backhaul to Minnesota
built fiber network in Des Moines, upgraded backhaul to Minnesota
• Secured Broadband Stimulus Grant of $16.8 M
2010 Highlights
Revenue Diversification
Business & Broadband Growth
Business & Broadband Revenue
Fiber & Data Revenue Growth
Broadband Penetration of Access Lines
David Christensen,
Sr. Vice President and
Chief Financial Officer
Chief Financial Officer
Financial Overview
• 2009 net income included a
$4.4 M income tax reserve release
(non recurring)
$4.4 M income tax reserve release
(non recurring)
• 2010 net income included a
$2.7 M income tax reserve release
(non recurring)
$2.7 M income tax reserve release
(non recurring)
• Lower interest expense in 2010
• Strong wholesale transport sales,
equipment sales rebound, and a
unique fiber construction project
positively impacted income
equipment sales rebound, and a
unique fiber construction project
positively impacted income
2010 Financial Results
EBITDA
2010 compared to 2009
• Business Sector EBITDA
grew 46%
grew 46%
• Telecom Sector EBITDA
down 7%
down 7%
• Net overall EBITDA increase
($ in Millions)
2010 Financial Results
2010 Company Results
EBITDA
($ in Millions)
Revenue
EBITDA
Fiber and Data Revenue
($ in Millions)
Operating Cash Flow (EBITDA minus Capex)
Business Sector Results
EBITDA
Operating Cash Flow
Telecom Sector Results
($ in Millions)
Telecom Operating Cash Flow Remains Strong
Telecom Sector Results
First Quarter 2011 Highlights
Q1-11 compared to Q1-10
• Consolidated revenue totaled $38.6 million
– Fiber and data revenue grew 13%
– Equipment support services revenue up 20%
– Broadband revenue grew 14%
– Surpassed 20,000 DSL subscribers
• Operating Income of $4.7 M, up 5%
• Pre-tax Income of $3.6 M, up 24%
• Net Income of $2.1 M, up 50%
• Net debt position improved $10 M
• Net debt was $108.9 M,
down $10 M from 12/31/10
down $10 M from 12/31/10
• Lower intra-quarter
borrowing and interest rates
in 2011, 33% reduction in
interest expense
borrowing and interest rates
in 2011, 33% reduction in
interest expense
• New senior debt agreement
expected by Q3-11
expected by Q3-11
Deleveraging the Balance Sheet
Maximum Debt/EBITDA ratio in debt covenant
• Reduced leverage by executing on growth plan and managing debt
• Achieved lower debt to EBITDA ratio reducing our interest rates
Debt/EBITDA ratio
HTCO - Nasdaq - S&P 500 -
Daily performance May 2010 to May 2011
Relative Stock Performance
$0.525
$9.72*
=
5.4% Yield
*Yield based on HTCO Stock Price of $9.72 on 5/16/11
Dividend Return
• Q1-2011 dividend declared of $0.135 per share
Dividend increased in Q4-10 to $0.135, +3.9%
• 2010 annual dividends totaled $0.525 per share
• Dividend yield: 5-6%
• More than 60 years of dividend payments
Business and Broadband Growth
Business Sector
• Focus on growth in fiber and data services
• Expand fiber network (broadband stimulus, last mile fiber builds)
• Focus on SMB, enterprise, & wholesale customer segments
• Grow monthly recurring revenue streams
Telecom Sector
• Grow broadband services, market bundle of services,
focus on customer retention
focus on customer retention
• Manage the network access decline
• Leverage local customer service and community presence
• Maintain strong free cash flow
Strategic Business Initiatives
Key Initiatives in 2011
Goal: to double the value of HickoryTech by 2014
Goal: to double shareholder value by the end of 2014 by growing EBITDA,
driving growth in lines of business with higher value and management of our debt level.
driving growth in lines of business with higher value and management of our debt level.
Five-Year Growth Goal
Why invest in HickoryTech?
Diverse revenue streams / markets, emerging
growth through business revenue stream and fiber
network expansion
growth through business revenue stream and fiber
network expansion
More than 60 years of dividend return, yield 5-6%
Experienced company with 113-year track record of
financial stability
financial stability
Strong cash flow, strong balance sheet, solid track
record, high level of recurring revenue
record, high level of recurring revenue
Focused on doubling the value of HickoryTech by
2014 by growing EBITDA, strategic services,
managing debt
2014 by growing EBITDA, strategic services,
managing debt
Questions
Focused on Business and
Broadband Growth
Broadband Growth
Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures