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Lumos Networks Corp. Reports Operating Results For The Fourth Quarter And Year 2011

Lumos Networks Corp. (“Lumos Networks” or “the Company”) (Nasdaq: LMOS), a fiber-based service provider of voice, data and IP-based telecommunication services in the Mid-Atlantic region, today announced operating results for its fourth quarter and year 2011. Lumos Networks was separated from NTELOS Holdings Corp. through a spin-off effective after the close of business on October 31, 2011.

Total revenue for the fourth quarter 2011 was $51.1 million, compared to $41.0 million for fourth quarter 2010. For the year 2011, total revenue was $207.4 million, compared to $146.0 for 2010. Total adjusted EBITDA was $23.0 million for the fourth quarter 2011, compared to $21.1 million in fourth quarter 2010, and $96.9 million for the year 2011 compared to $77.1 million for 2010. These reported results reflect the operations of FiberNet, which was acquired December 1, 2010. Proforma revenue for the year 2010 was $213.1 million.

“The year 2011 marked several milestones for Lumos Networks,” said Michael B. Moneymaker, president. “We completed the separation from NTELOS and the integration of the FiberNet and Alleghany fiber acquisitions. During the year, we enabled Metro Ethernet or IP voice services in 30 new markets. We are positioned to increase data sales in 2012 as we now focus our resources on the data growth opportunities ahead of us.”

Highlights

  • In support of the company’s strategy to expand Enterprise Data sales in existing and newly-enabled markets, on-net buildings reached 1,051 during fourth quarter, driving a 16% increase in this revenue over fourth quarter 2010 (pro forma) and a 4% increase sequentially over third quarter 2011.
  • Fiber connections to wireless cell sites were increased 12% in fourth quarter, as the company pursues new wholesale opportunities presented by growing data capacity demand of carriers. Fiber connections to cell sites totaled 148 at year-end, with an additional 150 sites now contracted to be built in 2012. Wholesale data revenue for the quarter was up 24% (pro forma) over fourth quarter 2010, and up 10% over the previous quarter.
  • A 30% year over year increase of account executives selling flagship data products to businesses and wireless carriers is planned for 2012 to support the projected Competitive data revenue growth in the expanded seven-state market area served by the Company’s 5,800 route-mile fiber network .
  • The transition of revenue composition to data products continues. The Competitive segment, comprised of approximately two-thirds data revenue, accounted for 77% of consolidated revenue in fourth quarter 2011.
  • On February 23, 2012, the Board of Directors of Lumos Networks Corp. declared a quarterly cash dividend on its common stock in the amount of $0.14 per share to be paid on April 12, 2012 to stockholders of record on March 14, 2012.

“We continue to see strong growth in revenue from enterprise data and wholesale products, both year over year and sequentially,” said Moneymaker. “While we believe the timing has accelerated the majority of the impact into 2012, the level of decline of RLEC access revenue from carrier network grooming and access reform was expected over time and was anticipated by the capital structure we put in place upon the separation.” He continued, “Our current and projected future growth in data revenues remains the catalyst for long-term revenue growth and it is expected this will drive annual year over year growth in total revenue in 2013.”

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