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Lumos Networks Corp. Reports Third Quarter 2013 Financial Results

Stocks in this article: LMOS

Lumos Networks Corp. (“Lumos Networks” or “the Company”) (Nasdaq: LMOS), a fiber-based service provider of data, voice and IP-based telecommunication services in the Mid-Atlantic region, today announced financial results for its third quarter of 2013.

Total revenue for the third quarter of 2013 was $51.6 million, compared to $52.0 million for the third quarter of 2012 and $52.3 million in the second quarter of 2013. Total Adjusted EBITDA was $23.0 million for the third quarter of 2013, compared to $22.3 million in the third quarter of 2012 and $24.6 million in the second quarter of 2013.

“While our results in the third quarter of 2013 were below our expectations, we are maintaining our 2013 financial guidance of $208 million for revenue and $97 million for Adjusted EBITDA,” said Tim Biltz, CEO of Lumos Networks. “In the third quarter of 2013, Lumos Networks delivered total Strategic Data revenue of $30.4 million, equal to nearly 59% of total revenue and representing a year-over-year increase of over 11%. The percentage of total revenue derived from Strategic Data increased by over 6% from the prior year period.”

Mr. Biltz continued, “We are beginning to see positive results from our plans to accelerate Strategic Data revenue growth and we project that sequential revenue in this segment will increase from 1.4% in the third quarter to over 2% in the fourth quarter. Additionally, we estimate that our operating expenses in the fourth quarter of 2013 will be lower than the third quarter.”

“Therefore, we expect our Adjusted EBITDA to improve on a sequential basis in the fourth quarter,” Mr. Biltz said. “For the full year 2013, we are on track to post overall revenue growth, Strategic Data revenue growth of nearly 12% and Adjusted EBITDA growth of over 9%.”

Highlights

  • The Company ended the quarter with 540 fiber to the cell (“FTTC”) site installations, up 75 sequentially, which represents a year-over-year increase in total FTTC sites of 107%. Lumos Networks expects to end 2013 with over 600 installed sites and maintains its target for 1,500 sites within the next few years.
  • The Company’s project to upgrade its internal systems is off to a good start and is expected to drive operating efficiencies, improve customer facing capabilities and streamline business processes as we progress through 2014.
  • At the end of the third quarter, Lumos Networks officially “lit up” its metro fiber network in Richmond, Virginia and has pre-sold approximately $1.4 million in annualized revenue in that market, with the vast majority being strategic data.
  • On October 30, 2013, the Board of Directors of Lumos Networks declared a dividend on its common stock in the amount of $0.14 per share to be paid on January 9, 2014 to stockholders of record on December 12, 2013.

Business Outlook

In the fourth quarter of 2013, the Company expects revenue to be $51 to $52 million and Adjusted EBITDA $24 to $25 million. For the full year 2013, the Company is maintaining its guidance of $208 million for revenue and $97 million for Adjusted EBITDA.

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