NTELOS Holdings Corp. Reports Third Quarter 2012 Operating Results

  NTELOS Holdings Corp. Reports Third Quarter 2012 Operating Results

                 –Net Quarterly Subscriber Additions of 5,500

                      –Adjusted EBITDA of $31.9 Million

           –Company Declares Quarterly Dividend of $0.42 Per Share

Business Wire

WAYNESBORO, Va. -- November 08, 2012

NTELOS Holdings Corp. (the “Company,” NASDAQ: NTLS), a leading regional
provider of nationwide wireless voice and data communications and home to the
“best value in wireless,” announced today operating results for its third
quarter ended September 30, 2012.

Third Quarter Highlights

  *Operating revenues for the third quarter 2012 increased 7% to $114.5
    million, compared to $107.4 million for the same period in 2011;
  *Net subscriber additions for the third quarter 2012 were 5,500, compared
    to a net loss of (9,800) for the same period in 2011;
  *Blended subscriber churn for the third quarter 2012 improved to 2.9%,
    compared to 3.7% for the same period in 2011; and
  *Blended ARPU for the third quarter was $50.93, compared to $49.77 for the
    same period in 2011.

“During the third quarter, we continued to execute successfully against our
combined retail / wholesale operating model. Within our retail business, we
were extremely encouraged by the substantial increase in subscriber revenue,
which had its largest sequential improvement in more than four years. We also
experienced substantial growth in smartphone penetration during the quarter,
ending the period with smartphone customers representing 50% of our subscriber
base, up from 45% and 24% at the end of Q2 2012 and Q3 2011, respectively.
These accomplishments were the result of a strong response to the value
proposition within our network operating footprint, continued improvements in
our distribution network as well as favorable handset additions to our
smartphone lineup,”noted James A. Hyde, CEO of NTELOS Holdings Corp. “At the
same time, wholesale revenue increased sequentially and year-over-year, driven
by the continued growth in both voice and data usage on our network.”

Highlights from Operations

  *Operating revenues for the third quarter 2012 were $114.5 million, up 7%
    from the third quarter 2011. The increase in operating revenues reflected
    both an increase in wholesale revenue and an increase in retail revenues;

  *Retail revenues, which include subscriber and equipment revenue, were
    $71.1 million for the third quarter 2012, compared to $69.9 million for
    the third quarter 2011;
  *Wholesale and other revenue derived primarily from the Company’s Strategic
    Network Alliance with Sprint increased 16% to $43.3 million for the third
    quarter 2012, compared to $37.5 million for the third quarter 2011;
  *Adjusted EBITDA was $31.9 million for the third quarter 2012, compared to
    $38.7 million for the third quarter 2011; and
  *Income from continuing operations, less net income attributable to
    noncontrolling interests, was $4.6 million, or $0.22 per diluted share,
    for the third quarter 2012 compared to $6.5 million, or $0.31 per diluted
    share, for the same period in 2011.

Total Subscribers

  *Total subscribers were 430,300 as of September 30, 2012, compared to
    415,000 as of September 30, 2011;
  *Total gross additions for the third quarter were 42,400, compared to
    36,500 for the same period of 2011; and
  *Total net subscriber additions for the third quarter were 5,500, compared
    to a loss of (9,800) for the same period for 2011.

Postpay Subscribers

  *Postpay subscriber gross additions for the third quarter 2012 were 22,000,
    compared to 16,500 in the third quarter 2011 and 16,800 in the second
    quarter 2012;
  *Net postpay subscriber additions were 4,900 for the third quarter 2012,
    compared to a loss of (6,400) in the third quarter 2011 and up
    significantly from a gain of 700 in the second quarter 2012;
  *Postpay churn for the third quarter 2012 was 2.0%, compared to 2.6% in the
    third quarter 2011; and
  *As of September 30, 2012, total postpay subscribers were 288,900.

Prepay Subscribers

  *Prepay subscriber gross additions for the third quarter 2012 were 20,400,
    compared to 20,000 in both the third quarter 2011 and second quarter 2012;
  *Net prepay subscriber additions were 600 for the third quarter 2012,
    compared to a loss of (3,400) in the third quarter 2011 and additions of
    2,800 in the second quarter 2012;
  *Prepay churn for the third quarter 2012 was 4.7%, compared to 6.5% in the
    third quarter 2011; and
  *As of September 30, 2012, total prepay subscribers were 141,400.

Mr. Hyde concluded, “We expect the favorable trends seen in the first nine
months of 2012 to continue. The benefits of the improvements we have made to
our handset lineup and the consistent focus on our value proposition and brand
positioning are successfully impacting our retail business. These results
complement the continued growth recognized in the wholesale business, which
combined provide a catalyst for positive returns for our shareholders.”

Discontinued Operations

The Company completed the separation of its wireless and wireline operations
with the spin-off of Lumos Networks Corp. (NASDAQ: LMOS) on October 31, 2011.
The wireline results are reflected as Discontinued Operations for all periods
presented. As such, the reported operating results reflect the wireless
operations of the Company, including certain expenses related to the business
separation.

Net Income

Net income, after net income attributable to noncontrolling interests, was
$4.6 million, or $0.22 per diluted share, for the third quarter 2012, compared
to net income, after net income attributable to noncontrolling interests, of
$13.3 million, or $0.63 per diluted share, for the third quarter 2011, which
included $6.8 million related to discontinued operations.

Declaration of Dividend

On November 2, 2012, the Company’s Board of Directors declared a quarterly
cash dividend on its common stock in the amount of $0.42 per share to be paid
on January 11, 2013 to stockholders of record on December 14, 2012.

Business Outlook

For the year ended December 31, 2012, the Company expects its full year 2012
Adjusted EBITDA to be between $132.0 million and $136.0 million. In addition,
the Company expects its full year 2012 capital expenditures to be
approximately $75.0 million. Lastly, the Company reaffirmed previously
communicated subscriber development guidance of net positive subscriber growth
in both postpaid and prepaid subscribers for the full year 2012.

Conference Call

The Company will host a conference call with investors and analysts to discuss
its third quarter 2012 results this morning, November 8, 2012, at 10:00a.m.
ET. To participate, please dial 1-877-317-6789, 1-866-605-3852 in Canada and
1- 412-317-6789 for international, approximately 10 minutes before the
scheduled start of the call. The conference call will also be accessible live
on the Investor Relations section of the Company’s website at
http://ir.ntelos.com.

An archive of the conference call will be available online at
http://ir.ntelos.com beginning approximately two hours after the call and
continuing until November 15, 2012. A replay will also be available via
telephone by dialing 1-877-344-7529, 1-412-317-0088 internationally and
entering access code 10020133 beginning approximately two hours after the call
and continuing until November 15, 2012.

Non-GAAP Measures

Adjusted EBITDA is defined as net income attributable to NTELOS Holdings Corp.
before interest, income taxes, depreciation and amortization, accretion of
asset retirement obligations, gain/loss on derivatives, net income
attributable to noncontrolling interests, other expenses/income, equity-based
compensation charges, acquisition related charges, net income from
discontinued operations and costs related to the separation of the wireless
and wireline operations.

ARPU, or average monthly revenue per user, is computed by dividing service
revenues per period by the average number of subscribers during that period.
Please see the footnotes in the exhibits for a complete definition of this
measure.

Adjusted EBITDA is a key metric used by investors to determine if the Company
is generating sufficient cash flows to continue to produce shareholder value,
provide liquidity for future growth and continue to fund dividends. ARPU
provides management with useful information concerning the appeal of the
Company’s rate plans and service offerings and the Company’s performance in
attracting and retaining high value customers.

Adjusted EBITDA and ARPU are non-GAAP financial performance measures. They
should not be considered in isolation or as an alternative to measures
determined in accordance with accounting principles generally accepted in the
United States of America (“GAAP”). Please refer to the exhibits and materials
posted on the Company’s website for a reconciliation of these non-GAAP
financial performance measures to the most comparable measures reported in
accordance with GAAP and for a discussion of the presentation, comparability
and use of such financial performance measures.

About NTELOS

NTELOS Holdings Corp. (NASDAQ: NTLS), operating through its subsidiaries as
“nTelos Wireless,” is headquartered in Waynesboro, VA, and provides
high-speed, dependable nationwide voice and data coverage for over 430,000
retail subscribers based in Virginia, West Virginia and portions of Maryland,
North Carolina, Pennsylvania, Ohio and Kentucky. The Company’s licensed
territories have a total population of approximately 8.1 million residents, of
which its wireless network covers approximately 6.0 million residents. The
Company is also the exclusive wholesale provider of wireless digital PCS
services to Sprint Nextel in the Company’s western Virginia and West Virginia
service area for all Sprint CDMA wireless customers. Additional information
about the Company is available at www.ntelos.com or
www.facebook.com/nteloswireless and www.twitter.com/ntelos_wireless.

SPECIAL NOTE FROM THE COMPANY REGARDING FORWARD-LOOKING STATEMENTS

Any statements contained in this press release that are not statements of
historical fact, including statements about our beliefs and expectations, are
forward-looking statements and should be evaluated as such. The words
“anticipates,” “believes,” “expects,” “intends,” “plans,” “estimates,”
“targets,” “projects,” “should,” “may,” “will” and similar words and
expressions are intended to identify forward-looking statements. Such
forward-looking statements reflect, among other things, our current
expectations, plans and strategies, and anticipated financial results, all of
which are subject to known and unknown risks, uncertainties and factors that
may cause our actual results to differ materially from those expressed or
implied by these forward-looking statements. Many of these risks are beyond
our ability to control or predict. Because of these risks, uncertainties and
assumptions, you should not place undue reliance on these forward-looking
statements. Furthermore, forward-looking statements speak only as of the date
they are made. We do not undertake any obligation to update or review any
forward-looking information, whether as a result of new information, future
events or otherwise. There are important factors with respect to any such
forward-looking statements, including certain risks and uncertainties that
could cause actual results to differ from those contained in the
forward-looking statements. We advise the reader to review in detail the
cautionary statements and risk factors included in our SEC filings, including
our most recent Annual Report filed on Form 10-K.

Exhibits:

  *Condensed Consolidated Balance Sheets (unaudited)
  *Condensed Consolidated Statements of Operations (unaudited)
  *Reconciliation of Net Income Attributable to NTELOS Holdings Corp. to
    Adjusted EBITDA
  *Key Metrics
  *ARPU Reconciliation

NTELOS Holdings Corp.                                     
Condensed Consolidated Balance Sheets                     
(unaudited)
                                                             
(In thousands)                          September 30, 2012   December 31, 2011
                                                             
ASSETS
Current Assets
Cash                                    $      64,604        $     59,950
Restricted cash                                -                   199
Accounts receivable, net                       42,348              36,292
Inventories and supplies                       10,352              7,570
Prepaid expenses and other current            13,662             14,445
assets
                                              130,966            118,456
                                                             
Securities and Investments                     1,524               1,403
                                                             
Property, Plant and Equipment, net             299,015             288,368
                                                             
Intangible Assets
Goodwill                                       63,700              63,700
Radio spectrum licenses                        132,326             132,318
Customer relationships and                     10,749              13,336
trademarks, net
                                                             
Deferred Charges and Other Assets              8,910               10,409
                                                            
Total Assets                            $      647,190       $     627,990
                                                             
LIABILITIES AND EQUITY
Current Liabilities
Current portion of long-term debt       $      5,153         $     4,412
Accounts payable                               21,771              18,118
Dividends payable                              8,923               8,902
Advance billings and customer                  11,104              10,003
deposits
Accrued expenses and other current            21,562             14,316
liabilities
                                              68,513             55,751
                                                             
Long-Term Debt                                 451,183             453,997
                                                             
Other Long-Term Liabilities                    79,485              67,108
                                                             
Equity                                         48,009              51,134
                                                            
Total Liabilities and Equity            $      647,190       $     627,990
                                                                   

NTELOS Holdings                                             
Corp.
Condensed
Consolidated
Statements of                                                  
Operations
(unaudited)
                  Three Months Ended September 30,   Nine Months Ended
                                                     September 30,
(In thousands,
except per          2012           2011          2012        2011    
share amounts)
                                                                   
Operating         $  114,466        $  107,404       $ 336,591     $ 316,633
Revenues
                                                                   
Operating
Expenses
Cost of sales
and services
(exclusive of        46,270            36,303          127,263       106,135
items shown
separately
below)
Customer             30,068            27,980          89,459        87,258
operations
Corporate            8,599             9,589           24,908        24,922
operations
Depreciation
and                 15,810          16,098        45,818      45,494  
amortization
                    100,747         89,970        287,448     263,809 
                                                                   
Operating            13,719            17,434          49,143        52,824
Income
                                                                   
Other Expense
Interest             (5,432   )        (5,509   )      (16,293 )     (17,918 )
expense
Other expense,      (50      )       (23      )     (156    )    (1,897  )
net
                    (5,482   )       (5,532   )     (16,449 )    (19,815 )
                                                                   
Income from
Continuing
Operations           8,237             11,902          32,694        33,009
before Income
Taxes
                                                                   
Income Taxes        3,141           4,969         13,130      14,291  
                                                                   
Income from
Continuing           5,096             6,933           19,564        18,718
Operations
                                                                   
Discontinued        -               6,813         -           19,426  
Operations, net
                                                                   
Net Income           5,096             13,746          19,564        38,144
                                                                   
Net Income
Attributable to     (488     )       (481     )     (1,498  )    (1,322  )
Noncontrolling
Interests
                                                                   
Net Income
Attributable to   $  4,608         $  13,265       $ 18,066     $ 36,822  
NTELOS Holdings
Corp.
                                                                   
                                                                   
Earnings per
Share
Attributable to
NTELOS Holdings
Corp. ^1
                                                                   
Basic
Continuing        $  0.22           $  0.31          $ 0.87        $ 0.84
operations
Discontinued        -               0.33          -           0.93    
operations
Total             $  0.22          $  0.64         $ 0.87       $ 1.77    
                                                                   
Diluted
Continuing        $  0.22           $  0.31          $ 0.85        $ 0.83
operations
Discontinued        -               0.32          -           0.92    
operations
Total             $  0.22          $  0.63         $ 0.85       $ 1.75    
                                                                   
Weighted
average shares      20,900          20,799        20,877      20,767  
outstanding -
basic
                                                                   
Weighted
average shares      21,375          21,084        21,317      21,049  
outstanding -
diluted
                                                                   
Cash Dividends
Declared per      $  0.42          $  0.56         $ 1.26       $ 1.68    
Share - Common
Stock
                                                                   

     All share and per share amounts presented in this press release and on
     the Company's Form 10-Q have been adjusted for the impact of the reverse
^1  stock split which occurred after market close on October 31, 2011 in
     connection with the separation of the Company's wireless and wireline
     operations.
     

NTELOS Holdings                                             
Corp.
Reconciliation of Net Income Attributable to NTELOS Holdings    
Corp. to Adjusted EBITDA
                                                
                     Three Months Ended September   Nine Months Ended
                     30,                            September 30,
(In thousands)       2012             2011          2012           2011
                                                                      
Net Income
Attributable to      $   4,608        $   13,265    $  18,066      $  36,822
NTELOS Holdings
Corp.
Net income
attributable to         488             481         1,498         1,322
noncontrolling
interests
Net Income               5,096            13,746       19,564         38,144
                                                                   
Discontinued            -               6,813       -             19,426
operations, net
Income from
continuing               5,096            6,933        19,564         18,718
operations
                                                                   
Interest expense         5,432            5,509        16,293         17,918
Income taxes             3,141            4,969        13,130         14,291
Other expense           50              23          156           1,897
(income), net
Operating income         13,719           17,434       49,143         52,824
                                                                   
Depreciation and         15,810           16,098       45,818         45,494
amortization
Accretion of asset
retirement               163              176          463            503
obligations
Equity-based             1,478            1,611        4,683          4,847
compensation
Business
separation charges      684             3,375       1,604         5,388
^1
Adjusted EBITDA      $   31,854       $   38,694    $  101,711     $  109,056
                                                                   
^1 Charges in connection with the separation of the Company's wireless and
wireline operations.

NTELOS                                                                       
Holdings Corp.
Key Metrics                                                        Nine Months Ended:
Quarter Ended:  9/30/2011  12/31/2011  3/31/2012  6/30/2012  9/30/2012   9/30/2012  9/30/2011
Subscribers                                                                   
Beginning         424,800     415,000    414,500    421,300    424,800     414,500    432,400
Subscribers
Prepay             122,800      119,900     122,100     135,300     139,400     122,100     125,600
Postpay            302,000      295,100     292,400     286,000     285,400     292,400     306,800
                                                                                          
Gross              36,500       41,600      45,900      36,800      42,400      125,100     116,500
Additions
Prepay             20,000       20,900      28,900      20,000      20,400      69,300      64,200
Postpay            16,500       20,700      17,000      16,800      22,000      55,800      52,300
                                                                                          
Disconnections     46,300       42,100      39,100      33,300      36,900      109,300     133,900
Prepay             23,400       19,500      17,300      17,200      19,800      54,300      71,000
Postpay            22,900       22,600      21,800      16,100      17,100      55,000      62,900
                                                                                          
Net Additions      (9,800)      (500)       6,800       3,500       5,500       15,800      (17,400)
(Losses)
Prepay             (3,400)      1,400       11,600      2,800       600         15,000      (6,800)
Postpay            (6,400)      (1,900)     (4,800)     700         4,900       800         (10,600)
                                                                                          
Ending             415,000      414,500     421,300     424,800     430,300     430,300     415,000
Subscribers
Prepay             119,900      122,100     135,300     139,400     141,400     141,400     119,900
Postpay            295,100      292,400     286,000     285,400     288,900     288,900     295,100
                                                                                          
Churn, net         3.7%         3.4%        3.1%        2.6%        2.9%        2.9%        3.5%
Prepay             6.5%         5.4%        4.5%        4.2%        4.7%        4.5%        6.3%
Postpay            2.6%         2.6%        2.5%        1.9%        2.0%        2.1%        2.3%
                                                                                          
Other Items                                                                   
                                                                                          
ARPU             $ 49.77     $  48.57     $ 49.08     $ 49.41     $ 50.93     $ 49.82     $ 50.18
Prepay           $ 33.68     $  33.01     $ 36.56     $ 34.89     $ 34.50     $ 35.28     $ 34.00
Postpay          $ 56.26     $  54.94     $ 54.63     $ 56.42     $ 58.97     $ 56.67     $ 56.86
                                                                                          
Data ARPU        $ 16.17     $  17.36     $ 19.05     $ 19.65     $ 20.25     $ 19.65     $ 15.38
                                                                                          
Licensed
Population         8.1          8.1         8.1         8.1         8.1         8.1         8.1
(millions)
                                                                                          
Covered
Population         5.9          5.9         5.9         6.0         6.0         6.0         5.9
(millions)
                                                                                          
Total Cell         1,337        1,353       1,365       1,378       1,396       1,396       1,337
Sites
                                                                                          
Strategic Network Alliance Revenues (000's)
Total Voice      $ 22,824    $  23,122    $ 23,533    $ 23,856    $ 24,655    $ 72,044    $ 65,557
Total Data        12,579     14,780    16,347    16,536    16,971     49,854    33,551
Total            $ 35,403   $  37,902   $ 39,880   $ 40,392   $ 41,626    $ 121,898  $ 99,108
                                                                                          

NTELOS Holdings                                            
Corp.
ARPU             Three Months Ended September    Nine Months Ended September
Reconciliation    30,                              30,
Average Monthly
Revenue per         2012           2011        2012        2011     
User (ARPU) ^1
(In thousands,
except for
subscribers and
ARPU)
                                                                  
Operating         $  114,466        $  107,404     $ 336,592      $ 316,633
Revenues
Less: Equipment
revenue from         (3,333   )        (2,284  )     (11,233  )     (6,214   )
sales to new
customers
Less: Equipment
revenue from
sales to             (3,416   )        (4,859  )     (11,722  )     (14,151  )
existing
customers
Less:
Wholesale,           (42,380  )        (37,715 )     (124,278 )     (104,151 )
other and
adjustments
                                                               
Gross
subscriber           65,337            62,546        189,359        192,117
revenue
                                                                  
Less: prepay
subscriber           (14,103  )        (11,946 )     (41,507  )     (37,170  )
revenue
Less:
adjustments to
prepay              (434     )       (235    )    (1,469   )    (871     )
subscriber
revenue
Gross postpay
subscriber        $  50,800        $  50,365     $ 146,383     $ 154,076  
revenue
                                                                  
Prepay
subscriber        $  14,103         $  11,946      $ 41,507       $ 37,170
revenue
Plus:
adjustments to
prepay              434             235         1,469        871      
subscriber
revenue
Gross prepay
subscriber        $  14,537        $  12,181     $ 42,976      $ 38,041   
revenue
                                                                  
Average number      427,610         418,923     422,351      425,391  
of subscribers
Total ARPU        $  50.93         $  49.77      $ 49.82       $ 50.18    
                                                                  
Average number
of postpay          287,165         298,387     287,015      301,064  
subscribers
Postpay ARPU      $  58.97         $  56.26      $ 56.67       $ 56.86    
                                                                  
Average number
of prepay           140,446         120,536     135,336      124,327  
subscribers
Prepay ARPU       $  34.50         $  33.68      $ 35.28       $ 34.00    
                                                                  
Gross
subscriber        $  65,337         $  62,546      $ 189,359      $ 192,117
revenue
Less: voice and
other feature       (39,366  )       (42,218 )    (114,653 )    (133,233 )
revenue
Data revenue      $  25,971        $  20,328     $ 74,706      $ 58,884   
                                                                  
Average number      427,610         418,923     422,351      425,391  
of subscribers
Total Data ARPU   $  20.25         $  16.17      $ 19.65       $ 15.38    
                                                                  
Gross postpay
subscriber        $  50,800         $  50,365      $ 146,383      $ 154,076
revenue
Less: postpay
voice and other     (33,028  )       (36,028 )    (95,950  )    (110,890 )
feature revenue
Postpay data      $  17,772        $  14,337     $ 50,433      $ 43,186   
revenue
                                                                  
Gross prepay
subscriber        $  14,537         $  12,181      $ 42,976       $ 38,041
revenue
Less: prepay
voice and other     (6,338   )       (6,190  )    (18,703  )    (22,340  )
feature revenue
Prepay data       $  8,199         $  5,991      $ 24,273      $ 15,701   
revenue
                                                                  
Average number
of postpay          287,165         298,387     287,015      301,064  
subscribers
Postpay data      $  20.63         $  16.02      $ 19.52       $ 15.94    
ARPU
                                                                  
Average number
of prepay           140,445         120,536     135,336      124,327  
subscribers
Prepay data       $  19.46         $  16.57      $ 19.93       $ 14.03    
ARPU
                                                                  

     Average monthly revenue per user (ARPU) is computed by dividing service
     revenues per period divided by the average number of subscribers during
     that period. ARPU as defined may not be similar to ARPU measures of other
     companies, is not a measurement under GAAP and should be considered in
     addition to, but not as a substitute for, the information contained in
^1  the Company’s unaudited condensed consolidated statements of operations.
     The Company closely monitors the effects of new rate plans and service
     offerings on ARPU in order to determine their effectiveness. ARPU
     provides management useful information concerning the appeal of NTELOS
     rate plans and service offerings and the Company’s performance in
     attracting and retaining high-value customers.

Contact:

Investor Relations:
KCSA Strategic Communications
Jeffrey Goldberger, 212-896-1249
jgoldberger@kcsa.com
or
Rob Fink, 212-896-1206
rfink@kcsa.com
 
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