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NTELOS Holdings Corp. Reports Third Quarter 2012 Operating Results

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.”

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