Shenandoah Telecommunications Company Reports First Quarter 2025 Results

EDINBURG, Va., April 30, 2025 (GLOBE NEWSWIRE) -- Shenandoah Telecommunications Company (“Shentel” or the “Company”) (Nasdaq: SHEN) announced first quarter 2025 financial and operating results.

First Quarter 2025 Highlights

• Glo Fiber Expansion Markets¹ data subscribers grew 51% over the same period in 2024 to approximately 71,000.
• Glo Fiber Expansion Markets revenue grew 52% to $18.4 million.
• Total revenue grew 26.9% compared to the same period in 2024 to $87.9 million. Excluding the former Horizon markets, total revenue grew 5% to $72.9 million.
• Net loss from continuing operations was $9.1 million in the first quarter of 2025 compared with a net loss from continuing operations of $4.1 million in the first quarter of 2024. The increase in the net loss was due primarily to higher depreciation and amortization from Horizon and Glo Fiber network expansion.
• Adjusted EBITDA² grew 43.3% to $27.6 million. Excluding the former Horizon markets, Adjusted EBITDA grew $3.9 million, or 20.6%.
  

“We are pleased with our growth in the first quarter of 2025, as we continued to execute well in our Glo Fiber Expansion Markets with 5,400 new subscribers, 16,600 new passings and 52% revenue growth.” said President and CEO, Christopher E. French. “Glo Fiber growth and higher Horizon synergy savings were key drivers in our return to strong Adjusted EBITDA growth in our legacy markets of 20.6%, along with an increase in Adjusted EBITDA margins from 28% to 31%.”

Shentel’s first-quarter earnings conference call will be webcast at 8:30 a.m. ET on Wednesday, April 30, 2025. The webcast and related materials will be available on Shentel’s Investor Relations website at https://investor.shentel.com/.

First Quarter 2025 Results Compared with First Quarter 2024

• Revenue increased by $18.7 million, or 26.9%, to $87.9 million, primarily due to $15.2 million of revenues earned in the acquired Horizon markets. Excluding Horizon, revenues grew by $3.5 million, or 5.0%, primarily due to Glo Fiber Expansion Markets Residential & SMB revenue growth of $5.6 million, or 46.5%. This growth was partially offset by Incumbent Broadband Markets³ revenue decline of $2.2 million, or 5.0%. Glo Fiber Expansion Markets revenue growth in Shentel’s legacy markets was driven by a 46.3% year-over-year growth in data revenue generating units (“RGUs”) driven by the Company’s increase in passings. Incumbent Broadband Markets revenue decreased primarily due to lower video revenue driven by a 14.1% decline in video RGUs and lower data revenue driven by a decrease in non-recurring other revenue.
  
• Cost of services increased by $7.0 million, or 27.1%, due to $7.6 million of cost of services incurred in the acquired Horizon markets, partially offset by a $0.6 million decrease in cost of services incurred in the legacy Shentel markets, driven by a decrease in programming costs.
  
• Selling, general and administrative expense increased by $3.0 million, or 10.8%, due to $3.2 million of selling, general and administrative costs incurred in the acquired Horizon markets and a $0.2 million decrease in the legacy Shentel markets driven by lower professional fees.
  
• Restructuring, integration and acquisition expense of $0.5 million in the three months ended March 31, 2025 was comparable with the three months ended March 31, 2024.
  
• Depreciation and amortization increased by $12.0 million, or 68.9%, due to $9.2 million of depreciation and amortization related to the tangible and intangible assets acquired in the Horizon transaction and the Company’s expansion of its Glo Fiber network.
  
• Total broadband homes passed grew 128,000 to approximately 604,000, including 363,000 Glo Fiber Expansion Market passings and 241,000 Incumbent Broadband Markets passings.

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1 Glo Fiber Expansion Markets consists of FTTH passings in greenfield expansion markets in the Shentel and Horizon markets.
2 See “Non-GAAP Financial Measures” below for a reconciliation to the most comparable GAAP measure.
3 Incumbent Broadband Markets consists of Shentel Incumbent Cable Markets and Horizon Incumbent Telephone Markets with Fiber-To-The-Home (“FTTH”) passings.

Other Information

• Capital expenditures were $83.2 million for the three months ended March 31, 2025 compared with $70.1 million in the comparable 2024 period. The $13.2 million increase in capital expenditures was primarily driven by capital expenditures in the Horizon markets and expansion of the networks in Glo Fiber Expansion Markets and government-subsidized markets.
  
• The Company received $6.9 million and $2.7 million in government grant cash reimbursements during the three months ended March 31, 2025 and 2024, respectively.
  
• As of March 31, 2025, our cash and cash equivalents totaled $87.5 million, the availability under our Revolver was $143.0 million, and the remaining reimbursements available under government grants was $104.1 million, which are subject to fulfilling the terms of the agreements, for total available liquidity of approximately $334.6 million. During the three months ended March 31, 2025, we borrowed a total of $100.0 million under our term loans and had total indebtedness of $515.8 million as of March 31, 2025.
  

Earnings Call Webcast

Date: Wednesday, April 30, 2025
Time: 8:30 a.m. ET
Listen via Internet: https://investor.shentel.com/
For Analysts, please register to dial-in at this link.

A replay of the call will be available for a limited time on the Investor Relations page of the Company’s website.

About Shenandoah Telecommunications

Shenandoah Telecommunications Company (Shentel) provides broadband services through its high speed, state-of-the-art fiber optic and cable networks to residential and commercial customers in eight contiguous states in the eastern United States. The Company’s services include: broadband internet, video, voice, high-speed Ethernet, dark fiber leasing, and managed network services. The Company owns an extensive regional network with over 17,200 route miles of fiber. For more information, please visit www.shentel.com.

This release contains forward-looking statements about Shentel regarding, among other things, its business strategy, its prospects and its financial position. These statements can be identified by the use of forward-looking terminology such as “believes,” “estimates,” “expects,” “intends,” “may,” “will,” “plans,” “should,” “could,” or “anticipates” or the negative or other variation of these or similar words, or by discussions of strategy or risks and uncertainties. The forward-looking statements are based upon management’s beliefs, assumptions and current expectations and may include comments as to Shentel’s beliefs and expectations as to future events and trends affecting its business that are necessarily subject to uncertainties, many of which are outside Shentel’s control. Although management believes that the expectations reflected in the forward-looking statements are reasonable, forward-looking statements are not, and should not be relied upon as, a guarantee of future performance or results, nor will they necessarily prove to be accurate indications of the times at which such performance or results will be achieved, and actual results may differ materially from those contained in or implied by the forward-looking statements as a result of various factors. A discussion of other factors that may cause actual results to differ from management’s projections, forecasts, estimates and expectations is available in Shentel’s filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2024 and our Quarterly Reports on Form 10-Q. Those factors may include, among others, the expected savings and synergies from the Horizon transaction may not be realized or may take longer or cost more than expected to realize, changes in overall economic conditions including rising inflation, regulatory requirements, changes in technologies, changes in competition, demand for our products and services, availability of labor resources and capital, natural disasters, pandemics and outbreaks of contagious diseases and other adverse public health developments, such as COVID-19, and other conditions. The forward-looking statements included are made only as of the date of the statement. Shentel undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events, except as required by law.

CONTACTS:
Shenandoah Telecommunications Company
Jim Volk
Senior Vice President and Chief Financial Officer
540-984-5168
Jim.Volk@emp.shentel.com

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1. Revenue from residential and small and medium business (“SMB”) customers in Incumbent Broadband Markets is primarily earned through the Company’s provision of data, video and voice services over primarily hybrid fiber coaxial cable and to a lesser extent fiber to the home (“FTTH”) networks in incumbent markets.
2. Revenue from residential and SMB customers in Glo Fiber Expansion Markets is primarily earned through the Company’s provision of data, video and voice services over FTTH networks in new greenfield expansion markets.
3. Shentel updated the presentation of certain Residential & SMB - Incumbent Broadband Markets and Commercial Fiber revenues in the prior year to conform with changes in how management views these lines of business.
   
   

Non-GAAP Financial Measures
Adjusted EBITDA and Adjusted EBITDA Margin

The Company defines Adjusted EBITDA as (loss) income from continuing operations calculated in accordance with GAAP, adjusted for the impact of depreciation and amortization, impairment expense, other income (expense), net, interest income, interest expense, income tax expense (benefit), stock compensation expense, transaction costs related to acquisition and disposition events (including professional advisory fees, integration costs, and related compensatory matters), restructuring expense, tax on equity award vesting and exercise events, and other non-comparable items. A reconciliation of (loss) income from continuing operations, which is the most directly comparable GAAP financial measure, to Adjusted EBITDA is provided below herein.

Adjusted EBITDA margin is the Company’s calculation of Adjusted EBITDA, divided by revenue calculated in accordance with GAAP.

The Company uses Adjusted EBITDA and Adjusted EBITDA margin as supplemental measures of performance to evaluate operating effectiveness and assess its ability to increase revenues while controlling expense growth and the scalability of the Company’s business growth strategy. Adjusted EBITDA is also a significant performance measure used by the Company in its incentive compensation programs. The Company believes that the exclusion of the expense and income items eliminated in calculating Adjusted EBITDA and Adjusted EBITDA margin provides management and investors a useful measure for period-to-period comparisons of the Company’s core operating results by excluding items that are not comparable across reporting periods or that do not otherwise relate to the Company’s ongoing operations. Accordingly, the Company believes that Adjusted EBITDA and Adjusted EBITDA margin provide useful information to investors and others in understanding and evaluating the Company’s operating results. However, use of Adjusted EBITDA and Adjusted EBITDA margin as analytical tools has limitations, and investors and others should not consider them in isolation or as substitutes for analysis of our financial results as reported under GAAP. In addition, other companies may calculate Adjusted EBITDA and Adjusted EBITDA margin or similarly titled measures differently, which may reduce their usefulness as comparative measures.

Supplemental Information

In the below table, Shentel updated the presentation of certain Residential & SMB - Incumbent Broadband Markets and Commercial Fiber revenues in the prior year to conform with changes in how management views these lines of business.

Operating Statistics

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^{(1) Homes and businesses are considered passed (“passings”) if we can connect them to our network without further extending the distribution system. Passings is an estimate based upon the best available information. Passings will vary among video, broadband data and voice services.
(2) Penetration is calculated by dividing the number of users by the number of passings or available homes, as appropriate.
(3) Total fiber miles are measured by taking the number of fiber strands in a cable and multiplying that number by the route distance. For example, a 10 mile route with 144 fiber strands would equal 1,440 fiber miles.
(4) Incumbent Broadband Markets consists of Shentel Incumbent Cable Markets and Horizon Incumbent Telephone Markets with FTTH passings.
(5) Glo Fiber Expansion Markets consists of FTTH passings in greenfield expansion markets in the Shentel and Horizon markets.}

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^{(1) Average Revenue Per RGU calculation = (Residential & SMB Revenue) / average RGUs / 3 months.}

Shentel updated the presentation of certain revenues in the prior year to conform with changes in how management views these lines of business. This reclassification also resulted in updated ARPU values for the prior period. The 2024 reclassification are summarized in the following table: