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NTELOS Holdings Corp. Reports Second Quarter 2013 Operating Results



     NTELOS Holdings Corp. Reports Second Quarter 2013 Operating Results

-Quarterly Subscriber Revenue up 18% to $72.9 Million

-Quarterly Adjusted EBITDA of $41.2 Million

-Company Declares Quarterly Dividend of $0.42 per Share

PR Newswire

WAYNESBORO, Va., July 30, 2013

WAYNESBORO, Va., July 30, 2013 /PRNewswire/ -- 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 second quarter ended June 30, 2013.

Second Quarter Highlights

  o Operating revenues for the second quarter 2013 increased 7.4% to $119.9
    million, compared to $111.6 million for the same period in 2012;
  o Total net subscriber additions were 3,800 for the second quarter 2013,
    compared to 3,500 for the same period in 2012;
  o Postpay churn for the second quarter 2013 was 1.8%, compared to 1.9% for
    the same period in 2012; and
  o Postpay ARPU for the second quarter 2013 was $63.48, compared to $56.42
    for the same period in 2012.

"During the second quarter of 2013, we continued to successfully execute
against our strategy to grow our business," said James A. Hyde, CEO of NTELOS
Holdings Corp. "Retail revenues increased for the sixth straight quarter,
driven by growth in our subscriber base and continued expansion of ARPU.  At
the same time, our wholesale revenues, primarily associated with Sprint,
remained strong driven by continued data usage on our network."

Highlights from Operations

  o Retail revenues, which include subscriber and equipment revenue, increased
    12.6% to $78.4 million for the second quarter 2013, compared to $69.6
    million for the second quarter 2012;
  o Wholesale and other revenue derived primarily from the Company's Strategic
    Network Alliance with Sprint were $41.4 million for the second quarter
    2013, compared to $41.9 million for the second quarter 2012; and
  o Adjusted EBITDA was $41.2 million for the second quarter 2013, compared to
    $34.0 million for the second quarter 2012.

Total Subscribers

  o Total subscribers were 454,800 as of June 30, 2013, compared to 424,800
    for the same period of 2012;
  o Total subscriber gross additions for the second quarter were 40,100,
    compared to 36,800 for the same period of 2012; and
  o Total net subscriber additions for the second quarter were 3,800, compared
    to 3,500 for the same period of 2012.

Postpay Subscribers

  o Postpay subscriber gross additions for the second quarter 2013 were
    16,300, compared to 16,800 for the second quarter 2012 and 20,200 for the
    first quarter 2013; 
  o Net postpay subscriber additions were 200 for the second quarter 2013,
    compared to 700 for the second quarter 2012 and 3,300 for the first
    quarter 2013;
  o Postpay churn for the second quarter 2013 was 1.8%, compared to 1.9% for
    the second quarter 2012 and 1.9% for the first quarter of 2013; and
  o As of June 30, 2013, total postpay subscribers were 298,700.

Prepay Subscribers

  o Prepay subscriber gross additions for the second quarter 2013 were 23,800,
    compared to 20,000 for the second quarter 2012 and 28,300 for the first
    quarter 2013;
  o Net prepay subscriber additions were 3,600 for the second quarter 2013,
    compared to 2,800 for the second quarter 2012 and 8,100 for the first
    quarter 2013;
  o Prepay churn for the second quarter 2013 was 4.4%, compared to 4.2% for
    the second quarter 2012 and 4.6% for the first quarter of 2013; and
  o As of June 30, 2013, total prepay subscribers were 156,100.

Mr. Hyde concluded, "Looking ahead, we remain focused on improving our service
offering, which includes expanding our network capabilities and further
enhancing the customer experience. Our plan to roll out LTE in our first
markets during the second half of 2013 remains on track. In addition, we are
also exploring new and innovative ways to maximize the value of our network
assets. For example, in May, we announced a pilot program with DISH Network to
potentially provide fixed-mobile broadband services within portions of our
footprint. Overall, we are excited about the growth prospects of both our
retail and wholesale businesses and will continue to seek ways to maximize
value for all key stakeholders."

Net Income

Net income after net income attributable to noncontrolling interests was $9.4
million, or $0.43 per diluted share, for the second quarter 2013 compared to
$5.6 million, or $0.26 per diluted share, for the second quarter 2012.

Declaration of Dividend

On July 25, 2013, 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
October 11, 2013 to stockholders of record on September 13, 2013.

Business Outlook

For the year ending December 31, 2013, the Company updated its full year 2013
Adjusted EBITDA guidance to between $140.0 million and $145.0 million
(previous range was $135.0 million and $145.0 million).  In addition, the
Company reiterates its full year 2013 capital expenditures guidance of between
$75.0 million and $85.0 million.

Conference Call

The Company will host a conference call with investors and analysts to discuss
its second quarter 2013 results this morning, July 30, 2013, at 11:00 a.m. ET.
To participate, please dial 1-888-317-6016, 1-855-669-9657 in Canada and
1-412-317-6016 for international, approximately 10 minutes before the
scheduled start of the call. The conference call and accompanying presentation
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 one hour after the call. A replay
will also be available via telephone by dialing 1-877-344-7529 or
1-412-317-0088 internationally and entering access code 10031675 beginning
approximately one hour after the call and continuing until August 15, 2013.

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 sale of assets and derivatives, net
income attributable to noncontrolling interests, other expenses/income,
equity-based compensation charges and acquisition related charges.

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 approximately
455,000 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 7.9 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.

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.

Investor Relations Contacts:

Jeffrey Goldberger / Rob Fink
KCSA Strategic Communications
P: 212-896-1249 / 212-896-1206
Email: jgoldberger@kcsa.com / rfink@kcsa.com

 

Exhibits:

  o Consolidated Balance Sheets
  o Consolidated Statements of Operations
  o Reconciliation of Net Income Attributable to NTELOS Holdings Corp. to
    Adjusted EBITDA
  o Key Metrics
  o ARPU Reconciliation

 

NTELOS Holdings Corp.
Condensed Consolidated Balance Sheets         (Unaudited)    (Unaudited)
                                              June 30, 2013  December 31, 2012
(In thousands)
           ASSETS
Current Assets  
 Cash                                         $  98,239      $        76,197
 Restricted cash                              2,167          -
 Accounts receivable, net                     51,601         51,301
 Inventories and supplies                     9,316          9,581
 Deferred income taxes                        3,248          4,297
 Prepaid expenses and other current assets    19,410         17,695
                                              183,981        159,071
Securities and Investments                    1,499          1,499
Property, Plant and Equipment, net            308,677        303,103
Intangible Assets 
 Goodwill                                     63,700         63,700
 Radio spectrum licenses                      131,831        132,033
 Customer relationships and trademarks, net   8,490          9,996
Deferred Charges and Other Assets             10,519         10,712
Total Assets                                  $708,697       $       680,114
           LIABILITIES AND EQUITY  
Current Liabilities 
 Current portion of long-term debt            $    5,447     $          5,429
 Accounts payable                             24,423         23,445
 Dividends payable                            9,018          -
 Accrued expenses and other current           50,416         34,457
 liabilities
                                              89,304         63,331
Long-Term Debt                                487,044        488,650
Other Long-Term Liabilities                   87,684         83,598
Equity                                        44,665         44,535
Total Liabilities and Equity                  $708,697       $       680,114

 

 

NTELOS Holdings Corp.
Condensed Consolidated      Three Months Ended         Six Months Ended
Statements of Operations
                            (Unaudited)                (Unaudited)
(In thousands, except per   June 30,     June 30,      June 30,    June 30,
share amounts)              2013         2012          2013        2012
Operating Revenues ^        $  119,859   $  111,585    $  239,204  $  222,125
Operating Expenses 
     Cost of sales and      42,567       41,793        87,102      80,993
     services
     Customer operations    29,977       29,808        60,931      59,391
     Corporate operations   7,760        8,310         15,664      16,309
     Depreciation and       20,443       15,101        38,899      30,008
     amortization     
     Gain on sale of        (4,442)      -             (4,442)     -
     intangible assets
                            96,305       95,012        198,154     186,701
Operating Income            23,554       16,573        41,050      35,424
Other Income (Expense)
     Interest expense       (7,398)      (5,433)       (14,759)    (10,861)
     Other income           151          (44)          (218)       (106)
     (expense), net
                            (7,247)      (5,477)       (14,977)    (10,967)
Income before Income Taxes  16,307       11,096        26,073      24,457
Income Taxes                6,380        4,609         10,124      9,989
Net Income                  9,927        6,487         15,949      14,468
Net Income Attributable to  (541)        (881)         (1,070)     (1,010)
Noncontrolling Interests
Net Income Attributable to  $      9,386 $      5,606  $    14,879 $    13,458
NTELOS Holdings Corp.
Earnings per Share
Attributable to NTELOS
Holdings Corp.:
     Basic                  $       0.45 $       0.27  $           $      
                                                       0.71        0.64
     Weighted average
     shares outstanding -   21,027       20,887        20,962      20,868
     basic 
     Diluted                $       0.43 $       0.26  $           $      
                                                       0.69        0.63
     Weighted average
     shares outstanding -   21,779       21,334        21,613      21,291
     diluted
Cash Dividends Declared per $       0.42 $       0.42  $           $      
Share - Common Stock                                   0.84        0.84

 

 

NTELOS Holdings Corp.
Reconciliation of Net Income Attributable to NTELOS Holdings Corp. to Adjusted
EBITDA^ 
(In thousands)
                               Three Months Ended         Six Months Ended 
                              June 30,       June 30,    June 30,    June 30,
                              2013           2012        2013        2012
   Net income attributable to $              $           $           $    
   NTELOS Holdings Corp.       9,386          5,606       14,879      13,458
   Net income attributable to 541            881         1,070       1,010
   noncontrolling interests 
   Net income                 $              $           $           $    
                               9,927          6,487       15,949      14,468
   Interest expense           7,398          5,433       14,759      10,861
   Income taxes               6,380          4,609       10,124      9,989
   Other expense, net         (151)          44          218         106
   Operating income           $              $           $           $    
                               23,554         16,573      41,050      35,424
   Depreciation and           20,443         15,101      38,899      30,008
   amortization     
   Gain on sale of intangible (4,442)        -           (4,442)     -
   assets
   Accretion of asset         173            151         316         300
   retirement obligations
   Equity-based compensation  1,460          1,536       2,781       3,205
   Business separation        -              635         -           921
   charges ^1 
   Adjusted EBITDA            $              $           $           $    
                               41,188         33,996      78,604      69,858
^1 Charges for legal and consulting services in connection with the separation
   of the Company's wireless and wireline operations.

 

 

NTELOS Holdings Corp.
Key Metrics                                                          Six Months Ended
 Quarter Ended:  6/30/2012 9/30/2012 12/31/2012 3/31/2013 6/30/2013  6/30/2012 6/30/2013
Subscribers
 Beginning       421,300   424,800   430,300    439,600   451,000    414,500   439,600
 Subscribers
 Postpay         286,000   285,400   288,900    297,400   299,700    292,400   297,400
 Prepay          135,300   139,400   141,400    142,200   151,300    122,100   142,200
 Gross           36,800    42,400    46,200     48,500    40,100     82,700    88,600
 Additions
 Postpay         16,800    22,000    25,100     20,200    16,300     33,800    36,500
 Prepay          20,000    20,400    21,100     28,300    23,800     48,900    52,100
 Disconnections  33,300    36,900    36,900     37,100    36,300     72,400    73,400
 Postpay         16,100    17,100    15,900     16,900    16,100     37,900    33,000
 Prepay          17,200    19,800    21,000     20,200    20,200     34,500    40,400
 Net Additions   3,500     5,500     9,300      11,400    3,800      10,300    15,200
 (Losses)
 Postpay         700       4,900     9,200      3,300     200        (4,100)   3,500
 Prepay          2,800     600       100        8,100     3,600      14,400    11,700
 Ending          424,800   430,300   439,600    451,000   454,800    424,800   454,800
 Subscribers
 Postpay         285,400   288,900   297,400    299,700   298,700    285,400   298,700
 Prepay          139,400   141,400   142,200    151,300   156,100    139,400   156,100
 Churn, net      2.6%      2.9%      2.8%       2.8%      2.7%       2.9%      2.7%
 Postpay         1.9%      2.0%      1.8%       1.9%      1.8%       1.9%      1.8%
 Prepay          4.2%      4.7%      4.9%       4.6%      4.4%       4.3%      4.5%
Other Items
 ARPU            $         $         $          $         $          $         $    
                  49.41     50.93     52.78      53.87     53.82      49.25     53.84
 Postpay         $         $         $          $         $          $         $    
                  56.42     58.97     61.19      62.67     63.48      55.52     63.08
 Prepay          $         $         $          $         $          $         $    
                  34.89     34.50     35.41      35.85     35.04      35.70     35.43
 Data ARPU       $         $         $          $         $          $         $    
                  19.65     20.25     21.03      21.86     22.14      19.35     22.00
 Licensed
 Population      8.1       8.1       7.9        7.9       7.9        8.1       7.9
 (millions)
 Covered
 Population      6.0       6.0       6.0        6.0       6.0        6.0       6.0
 (millions)
 Total Cell      1,378     1,396     1,429      1,431     1,432      1,378     1,432
 Sites
 Strategic Network Alliance Revenues
 (000's)
 Total Voice     $         $         $          $         $          $         $  
                  23,856    24,655    24,141     23,268    22,787     47,389    46,055
 Total Data      16,536    16,971    16,606     16,884    16,820     32,883    33,704
 Total           $         $         $          $         $          $         $  
                  40,392    41,626    40,747     40,152    39,607     80,272    79,759
 Gross Additions, Disconnections and Churn exclude
 customer returns within 14 calendar days. 

 From 11/1/11 to 4/4/12, the customer return period was
 30 calendar days.

 

 

NTELOS Holdings Corp.
ARPU Reconciliation          Three Months Ended        Six Months Ended 
Average Monthly Revenue per  June 30,     June 30,     June 30,     June 30,
User (ARPU) ^1              2013         2012         2013         2012 
(In thousands, except for
subscribers and ARPU)
Operating Revenues          $            $            $            $      
                            119,859      111,585      239,204      222,125
Less: Equipment revenue     (3,104)      (4,026)      (6,625)      (7,900)
from sales to new customers
Less: Equipment revenue
from sales to existing      (2,395)      (3,903)      (5,512)      (8,306)
customers
Less: Wholesale, other and  (41,179)     (41,061)     (82,097)     (81,897)
adjustments
 Gross subscriber revenue   73,181       62,595       144,970      124,022
Less:  prepay subscriber    (15,879)     (14,001)     (31,084)     (27,404)
revenue
Less:  adjustments to       (303)        (382)        (782)        (1,035)
prepay subscriber revenue
 Gross postpay subscriber   $            $            $            $        
revenue                     56,999       48,212       113,104      95,583
Prepay subscriber revenue   15,879       14,001       31,084       27,404
Plus:  adjustments to       303          382          782          1,035
prepay subscriber revenue
 Gross prepay subscriber    $            $            $            $        
revenue                     16,182       14,383       31,866       28,439
Average number of           453,262      422,247      448,753      419,721
subscribers
 Total ARPU                 $            $            $            $          
                            53.82        49.41        53.84        49.25
Average number of postpay   299,304      284,834      298,859      286,940
subscribers
 Postpay ARPU               $            $            $            $          
                            63.48        56.42        63.08        55.52
Average number of prepay    153,958      137,413      149,894      132,781
subscribers
 Prepay ARPU                $            $            $            $          
                            35.04        34.89        35.43        35.70
Gross subscriber revenue    73,181       62,595       144,970      124,022
Less: voice and other       (43,078)     (37,708)     (85,736)     (75,287)
feature revenue
 Data revenue               $            $            $            $        
                            30,103       24,887       59,234       48,735
Average number of           453,262      422,247      448,753      419,721
subscribers
 Total Data ARPU            $            $            $            $          
                            22.14        19.65        22.00        19.35
Gross postpay subscriber    56,999       48,212       113,104      95,583
revenue
Less: postpay voice and     (36,170)     (31,490)     (72,122)     (62,922)
other feature revenue
 Postpay data revenue       $            $            $            $        
                            20,829       16,722       40,982       32,661
Gross prepay subscriber     16,182       14,383       31,866       28,439
revenue
Less: prepay voice and      (6,908)      (6,218)      (13,614)     (12,365)
other feature revenue
 Prepay data revenue        $            $            $            $        
                            9,274        8,165        18,252       16,074
Average number of postpay   299,304      284,834      298,859      286,940
subscribers
 Postpay data ARPU          $            $            $            $          
                            23.20        19.57        22.85        18.97
Average number of prepay    153,958      137,413      149,894      132,781
subscribers
 Prepay data ARPU           $            $            $            $          
                            20.08        19.81        20.29        20.18

   Average monthly revenue per user (ARPU) is computed by dividing service
   revenues per period 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 the
^1 Company's 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. 

 

SOURCE NTELOS Holdings Corp.

Website: http://ir.ntelos.com
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