Attached files
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| 8-K - FORM 8-K - Enventis Corp | form8k.htm |
Exhibit 99.1
Third Quarter 2011
Earnings Conference Call
November 2, 2011
NASDAQ: HTCO
“Safe Harbor” Statement
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 are
available in our presentation.
2
Third Quarter 2011 Highlights
• Revenue totaled $45.2 million, +4%
– Equipment revenue up 43%
– Fiber and data organic revenue growth
of 14%
of 14%
– Broadband revenue grew 5%
• New favorable financing agreement
secured
secured
• Increased fiscal 2011 outlook
3
Consolidated Revenue
Q3 ’11 compared to Q3 ’10
• Equipment product revenue
+43%
+43%
• Fiber and data revenue down
14%
(+14% when excluding the 2010
fiber construction project)
14%
(+14% when excluding the 2010
fiber construction project)
• Broadband revenue +5%
($ in Millions)
Quarterly Revenue
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70% of YTD 2011 revenue is from Business Sector & Broadband Services
Revenue Diversification
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Q3 ’11 compared to Q3 ’10
• Q3 ’10 earnings positively impacted by
$1.9 M income tax reserve release.
Excluding release, EPS would be $0.24
per share
$1.9 M income tax reserve release.
Excluding release, EPS would be $0.24
per share
Q3 ’11 compared to Q3 ’10
• Higher profit operating revenue
• Q3 ’10 included $1.9 M income from
fiber construction project
fiber construction project
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Excludes tax reserve release
Business Sector
Q3 ’11 compared to Q3 ’10
• Revenue down 14%; excluding the fiber
construction project in 2010 revenue up 14%
construction project in 2010 revenue up 14%
• Fiber construction project (Dakotas expansion)
added $3.3 M revenue in Q3 ’10
added $3.3 M revenue in Q3 ’10
Q3 ’11 compared to Q3 ’10
• Equipment sales up 43%
• Equipment support services stable
Equipment Revenue
($ in Millions)
before intersegment
eliminations
eliminations
Formerly referred to as “Enventis Sector”
7
Excludes fiber construction project
Telecom Sector
Q3 ’11 compared to Q3 ’10
• Stable Telecom revenue
• Broadband revenue up 5%
• Network Access revenue down 5% and
Local Service revenue down 8%
Local Service revenue down 8%
Q3 ’11 compared to Q3 ’10
• Business Ethernet and data sales
• Digital TV subscribers +2%
• DSL subscribers +1%
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Debt Balance
9
Greater Minnesota Broadband
Collaborative Project
•Phase 1 extends fiber network from
St. Paul to Duluth, Minn. / Superior, Wisc.
Majority of project will be completed in 2011
St. Paul to Duluth, Minn. / Superior, Wisc.
Majority of project will be completed in 2011
•Phase 2 will extend fiber from Brainerd, Minn.
to Fargo, N.D.
Construction to begin in 2012
to Fargo, N.D.
Construction to begin in 2012
•Project will be completed by Aug. 2013
10
News Summary
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10/24/11 HickoryTech Named One of Forbes 100 Best Small Companies
10/13/11 Enventis Launches TelePresence Video Solutions
9/26/11 HickoryTech Declares Increased Quarterly Cash Dividend
8/25/11 Enventis Holds Ground Breaking for Greater Minnesota
Broadband Collaborative Project
Broadband Collaborative Project
8/22/11 Enventis Celebrates 10-Year Anniversary of SingleLink® Unified
Communications
Communications
8/18/11 HickoryTech Announces Share Repurchase Plan of up to $3 M
8/11/11 HickoryTech Signs Favorable New Financing Agreement for
Senior Notes and Revolving Credit Agreement
Senior Notes and Revolving Credit Agreement
8/9/11 Enventis Recognized by Cisco for Excellence in Customer
Satisfaction in United States
Satisfaction in United States
8/2/11 Enventis Total Care Support Provides Customers Peace of Mind
7/29/11 Enventis Recognized as Cisco TelePresence Video ATP Partner
2011 Fiscal Outlook
2011 Guidance increased in third quarter earnings released Nov. 1, 2011
12
Strategic Initiatives
• Focus on growing business services:
Ø Fiber network expansion
Ø Accelerated SMB market plan
Ø Target last-mile fiber builds
Ø Construction of broadband stimulus project
• Grow broadband services (Digital TV, DSL, data services)
• Increase capital spending on key strategic initiatives
• Manage free cash flow, manage costs and reduce debt in long
term
term
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Strategic Initiatives
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Strategic Initiatives Focused on Growth
HTCO Investment Highlights
• Stable growth and cash flows; 60+ years of dividend payments,
Q4-11 dividend increased to $0.14 per share, yield 5-6%
Q4-11 dividend increased to $0.14 per share, yield 5-6%
• Business transformation from a pure telephone company to an
integrated communications company serving businesses and
consumers
integrated communications company serving businesses and
consumers
• Emerging growth through B2B strategy and fiber network expansion
• High level of recurring revenue, expanded broadband service area
• Experienced Company with 112-year track record generating
stable operating results and financial position with strong strategic
plan
stable operating results and financial position with strong strategic
plan
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Reconciliation of Non-GAAP Measures
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Reconciliation of net debt:
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Sept. 30, 2011
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June 30, 2011
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Dec. 31, 2010
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Debt obligations, net of current maturities
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$ 119,169
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$ 8,462
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$ 114,067
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Current maturities of long-term obligations
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1,436
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110,230
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4,892
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Total Debt
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$ 120,605
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$ 118,692
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$ 118,959
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Less:
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Cash and cash equivalents
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11,316
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14,930
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73
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Net Debt
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$ 109,289
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$ 103,762
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$ 118,886
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Reconciliation of Non-GAAP Measures