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» Hickory Tech CEO Discusses Q3 2010 Results – Earnings Call Transcript
You are cautioned not to place undue reliance on these forward-looking statements made during this conference call, which represents estimates as of November 1, 2011. These statements are not guarantees of future performance and involve certain risks, uncertainties and probabilities which are difficult to predict. There are many such risks and uncertainties which could affect the economy, our industry and our company in particular, some or all of which could affect future results. More information on potential risks and uncertainties is available in the company's recent filings with the Securities and Exchange Commission, including HickoryTech's Annual Form 10-K report, Quarterly Form 10-Q report, and Form 8-K reports.This presentation also contains certain non-GAAP financial measures. Reconciliation of these non-GAAP measures to the most directly comparable GAAP measures are available in our presentation. All participants are advised that the audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. The audio will be archived on HickoryTech's Investor Relations website for the next 30 days. Following management's discussion today, we will open the call to a Q&A session. At this time, I'd like to turn the call over to John Finke. John Finke Thank you, Jennifer. Good morning, everyone. I'm pleased to share with you HickoryTech's Third Quarter 2011 results and highlight the progress we've made with our strategic initiatives. Today, I will cover several key metrics and highlight several news items and events from the past quarter. Dave will then walk you through our financial details for the third quarter. First off it was an eventful quarter and I'm pleased with our results. Revenue totaled $45.2 million for the quarter, up 4% from a year ago. We achieved continued strong growth in equipment sales, as well as in our fiber and data services and broadband services.
Operating income totaled $6.3 million and net income for the third quarter totaled $3 million. Net income was down year-over-year partly due to $1.9 million release of income tax reserves and $1.1 million net income from a fiber construction project in the third quarter of 2010, both of which increased net income in 2010.Our third quarter results show continued positive progress with our long-term strategy with focuses on maintaining and leveraging our telecom business, growing our business and broadband services and pursuing new growth opportunities. As we work hard to achieve our long-term goals we continue to stay focused on managing our strong cash flows and leveraging investment in key strategic growth areas. While consumer business remained stable we continue to see solid demand for our business services. As we extend our fiber network we will look for new opportunities to grow both organically and through acquisitions that will benefit HickoryTech across multiple customer segments in new and existing markets. In the third quarter, our business sector and our broadband revenue streams accounted for nearly three quarters of our total revenue and 70% on a year-to-date basis. We believe our strategic shift in focusing on business and broadband services has positioned HickoryTech for sustained and reliable growth. We continue to make investments in growth opportunities and we broke ground on our Greater Minnesota Broadband Collaborative Project in the third quarter, which will further expand our fiber footprint in northern Minnesota. Now reviewing our business sector results, which represents our Enventis branded markets. Third-quarter business sector revenue totaled $28 million, up 10% year-over-year primarily driven by increase in equipment and support services and supported by solid growth in our fiber and data services. Fiber and data revenues totaled $11.4 million, up 3% from the previous quarter, however down 14% year-over-year. A unique fiber construction project last year added $3.3 million of revenue and $1.9 million of pretax income to the fiber and data product line in the third quarter of 2010. Excluding this project fiber and data organic revenue growth was 14% in the third quarter of 2011. Read the rest of this transcript for free on seekingalpha.com