Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Revenue grew 30% to $87.6 million in the third quarter of 2024, with significant contributions from former Horizon markets.
- Glo Fiber brand expansion in Ohio and successful integration of commercial sales teams are expected to enhance sales bookings.
- Record quarter with 6,000 net subscriber additions and continued sales momentum into the fourth quarter.
- Adjusted EBITDA grew 31% to $26.6 million, with margins improving due to Glo Fiber revenue growth and synergy savings.
- Strong customer growth in Glo Fiber expansion markets, with a 58% year-over-year increase in Glo Fiber customers.
Negative Points
- Commercial revenue declined by $1.5 million due to the expected decline in T-Mobile revenue.
- Incumbent broadband markets revenue decreased by $1.3 million due to lower video and installation revenue.
- The slower growth in adjusted EBITDA was primarily due to the expected decline in T-Mobile revenue.
- Broadband data penetration rate in Glo Fiber expansion markets remained constant year over year at 18.5%, indicating potential challenges in increasing market penetration.
- Overall broadband data penetration decreased to 47.5% in incumbent markets, with competitive pressures affecting growth.
Q & A Highlights
Q: Have you seen any uptick in activity from Verizon or other competitors in your markets? Also, are there any attractive funding opportunities in your territory?
A: We have not observed significant new Verizon activity in our markets. Regarding funding opportunities, we see some potential in our incumbent telephone footprint areas, but they are modest compared to the grants we've already received through the American Rescue Plan Act funds.
Q: Are the 6,000 net subscriber additions primarily from Shenandoah or Horizon markets?
A: The 6,000 net additions are a combined number but primarily from the Legacy Shenandoah markets. The number of fiber passings in these markets is significantly larger than in the Horizon markets, where we currently have about 15,000 to 16,000 passings.
Q: When do you expect to see revenue synergies from the Horizon acquisition?
A: The key to realizing revenue synergies is ramping up fiber-to-the-home construction, which Horizon had paused. We've restarted construction with about 51,000 new fiber passings in the pipeline and expect to see customer increases in the Horizon markets in the fourth quarter.
Q: Will there be any seasonality in the net additions for Glo Fiber as your footprint expands?
A: Yes, we typically see the third quarter as a significant growth period, particularly in August. We expect to continue observing similar seasonality patterns as in the past.
Q: Are there any further questions?
A: There are no further questions at this time. Thank you for joining the call, and we look forward to updating you in future quarters on our progress with Glo Fiber and our broadband business.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
