Windstream reports first-quarter results

Windstream Holdings Inc (NASDAQ:WIN), a leading provider of advanced network communications reported its first quarter results.

The company said that it had a total revenue and sales of $1.45 billion under GAAP, an increase of six percent from the same period an year ago, Windstream had a total service revenue of $1.44 billion an increase of seven percent year-over-year.

As quoted in the press release:

“Our first quarter results show strong traction in our ongoing transformation of the company as evidenced by year-over-year growth in Adjusted OIBDAR,” said Tony Thomas, president and chief executive officer. “Customer demand for strategic services, including Unified Communications as a Service and SD-WAN, continued to grow and represented almost 40 percent of total enterprise sales during the quarter. Our recent network investments also have driven meaningful improvements in our broadband subscriber trends with March representing our best performance in more than five years.

“Total cash costs improved by more than 6 percent year-over-year, driven in part by our IT integration work, as well as our continued focus on reducing network interconnection expenses and driving improvements in our overall organizational effectiveness,” Thomas said.

Results under GAAP

Operating income was $69 million compared to $44 million in the same period a year ago. The company reported a net loss of $121 million, or a loss of 65 cents per share, compared to a net loss of $111 million, or a loss of 89 cents per share, a year ago.

ILEC consumer and small business service revenues were $471 million, a decrease of 5 percent from the same period a year ago, and segment income was $282 million compared to $289 million year-over-year.

Enterprise service revenues were $733 million, a 13 percent increase from the same period a year ago, and segment income was $146 million compared to $124 million year-over-year.

Wholesale service revenues were $184 million, a 3 percent increase from the same period a year ago, and segment income was $128 million compared to $127 million year-over-year.

CLEC consumer service revenues were $48 million, an increase of 131 percent from the same period a year ago, and segment income was $27 million compared to $11 million year-over-year.

Adjusted Results of Operations

Adjusted total revenues and sales were $1.45 billion compared to $1.52 billion in the same period a year ago. Adjusted total service revenues were $1.44 billion compared to $1.49 billion year-over-year.

Adjusted OIBDAR was $500 million compared to $499 million in the same period a year ago.

Adjusted capital expenditures were $208 million compared to $231 million in the same period a year ago.

ILEC consumer and small business service revenues were $471 million, a 5 percent decrease from the same period a year ago, and contribution margin was $282 million compared to $289 million a year ago.

Enterprise service revenues were $733 million, a 2 percent decrease from the same period a year ago, and contribution margin was $146 million compared to $140 million a year ago.

Wholesale service revenues were $184 million, a decrease of 8 percent from the same period a year ago, and contribution margin was $128 million compared to $138 million a year ago.

CLEC consumer service revenues were $48 million, a 7 percent decrease from the same period a year ago, and contribution margin was $27 million compared to $29 million a year ago.

Financial Outlook for 2018

The company’s 2018 full-year guidance remains unchanged. The company expects service revenue trends to be slightly improved versus 2017 trends. The company expects adjusted OIBDAR to be in the range of $1.95 billion to $2.01 billion. Adjusted capital expenditures are expected to be between $750 million and $800 million.

The company expects to generate adjusted free cash flow of approximately $165 million. The outlook assumes cash interest on long-term debt of approximately $385 million.

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