Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Enventis Corp | form8-k.htm |
Exhibit 99.1
Annual Shareholder Meeting
May 8, 2012
May 8, 2012
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
2
Dale Parker
Board Chairman
Welcome
3
Agenda
4
Board of Directors
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Business Meeting
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Proposals
1. Election of three directors for three-year terms:
Lyle Bosacker, Myrita Craig and John Finke
Lyle Bosacker, Myrita Craig and John Finke
2. Ratification of Grant Thornton LLP as the
Company’s independent accounting firm and
auditor for 2012
Company’s independent accounting firm and
auditor for 2012
7
John Finke
President and CEO
Business Overview
8
Executive Team
9
Video Presentation
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Highlights
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Strategic Initiatives
Goal: Diversify Revenue and Increase Shareholder Value
12
Transforming HickoryTech
Enventis
Acquisition
Acquisition
CP Telecom
Acquisition
Acquisition
Greater MN
Broadband
Collaborative
Project
Initiated
Broadband
Collaborative
Project
Initiated
Close on IdeaOne
Acquisition
Acquisition
Phase 2 of Broadband
Project fiber build
Building a Regional
Communications Company…
Communications Company…
Fiber network
expansion to
So. Dakota,
No. Dakota
expansion to
So. Dakota,
No. Dakota
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Idea One Acquisition
• Fiber-based communications
provider in Fargo, No. Dakota
provider in Fargo, No. Dakota
• Fits our strategy; primarily
business revenue
business revenue
• Further diversification
• Connects with our regional
fiber network
fiber network
• Free cash flow accretive in
2012
2012
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IdeaOne Acquisition
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Close Date
|
March 1, 2012
|
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IdeaOne
|
CLEC based in Fargo, North Dakota focused on
business customers |
|
Transaction price
|
$28 million, cash transaction with routine
adjustments for capital expenditures and working capital adjustments |
|
Financing structure
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$22 M of new term debt under existing credit
facility plus $6 M cash |
|
Fiber network
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225 fiber route miles, 650 lit buildings,
|
|
Employees
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40 based in Fargo, North Dakota
|
15
Revenue Growth & Diversification
69% of 2011 revenue was from Business and Broadband
Services
Services
2006 Revenue
$132.9 M
$132.9 M
2011 Revenue
$163.5 M
$163.5 M
Legacy Telecom
Business &
Broadband
Broadband
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EBITDA Growth
• Grew EBITDA
$9.2 M since 2006
$9.2 M since 2006
• Compound annual
growth rate of 5%
growth rate of 5%
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Debt Management
• Net debt reduced
$35.8 M since 2006
$35.8 M since 2006
• New senior debt
agreement secured
August 2011
agreement secured
August 2011
($ in Millions)
Net Debt Balance
Cash on hand
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Continued Investment
Fiber network includes 3,250
fiber route miles
fiber route miles
•Sioux Falls, Fargo, Des Moines
expansion
expansion
•Broadband enhancements;
Digital TV services, DSL speeds
Digital TV services, DSL speeds
•CP Telecom Acquisition
•Broadband Stimulus Routes
•IdeaOne Acquisition
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Shareholder Dividends
Increased dividend in 2011 and 2010
•More than 60 years of dividend payments
•Dividend yield: 5-6%
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Executing on the Plan
• Diversified and grew revenue
• Grew business and broadband services
• Managed Telecom decline
• Increased EBITDA
• Continued to invest in growth opportunities
• Refinanced and managed debt
• Increased dividend
• Expanded fiber footprint; acquired IdeaOne
• Created value for shareholders
21
David Christensen,
Sr. Vice President and
Chief Financial Officer
Chief Financial Officer
Financial Overview
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2011 Company Results
EBITDA
($ in Millions)
Revenue
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2011 Company Results
EBITDA
($ in Millions)
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• 2011 adjusted EBITDA
increased 6.4% from 2010
increased 6.4% from 2010
• 2-year (2009-2011) compound
annual growth rate of 4.2%
adjusted EBITDA
annual growth rate of 4.2%
adjusted EBITDA
($ in Millions)
EBITDA
Excludes one-time fiber project profits of
$2.4 M in 2010 and $500K one-time
acquisition costs in 2011
$2.4 M in 2010 and $500K one-time
acquisition costs in 2011
as defined by our credit agreement
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Debt Balance
($ in Millions)
Net Debt Balance
Cash on hand
Past acquisitions drove debt increase; history of debt pay down
Enventis
Acquisition
Acquisition
IdeaOne
Acquisition
Acquisition
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Leverage Ratio
Ratio of Debt to EBITDA = 2.9x at Q1-2012
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First Quarter 2012 Highlights
First Quarter 2012 compared to First Quarter 2011
•Revenue totaled $46.9 M, +22%
– Equipment Segment +67%
– Fiber and Data revenue +22%
– Telecom revenue -6%
•Operating income totaled $5.3 M, +13%
•Net income totaled $2.3 M, +8%
•EPS was $0.17 per share, +6%
•Closed on IdeaOne Acquisition March 1, 2012
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HTCO - Nasdaq - S&P 500 -
Five-year Stock Performance
Relative Stock Performance
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2011 Free Cash Flow
Free Cash Flow = $19.4 M
Dividend Payout is
38%
38%
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Key Initiatives
Goal: Increase Shareholder Value
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HickoryTech Strengths
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%
Increased dividend in 2011 and 2010
Experienced company with 114-year track record
of financial stability
of financial stability
Strong cash flow, strong balance sheet,
high level of recurring revenue
high level of recurring revenue
Focused on increasing the value of HickoryTech by
growing EBITDA, strategic services, managing debt
growing EBITDA, strategic services, managing debt
32
Questions
33
Follow us
Thank You
34
Reconciliation of Non-GAAP
35
Reconciliation of Non-GAAP
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Reconciliation of Non-GAAP
37