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| Statement |
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| All of our cohorts showed improvements in the fourth quarter, and we continue to see penetration rates above 18% after one year and above 30% after three years |
| As we ramp up Glo Fiber construction, we continue to see strong customer growth, as shown on slide 16 |
| 2023 was another strong year for Shentel as we continued executing our Glo Fiber expansion plan |
| Adjusted EBITDA margins expanded year-over-year from 28.4% to 31.5% in 2023, due to the scaling of our fiber network |
| We believe this is an industry-leading pace among publicly-traded broadband companies |
| Glo Fiber revenues have grown over 160% per year over the past three years, fueling our industry-leading consolidated revenue and adjusted EBITDA growth rates |
| Broadband adjusted EBITDA margins expanded 320 basis points year-over-year to 39.3% as we continue to see the benefits of operating leverage of our fiber network, as the broadband cost of service declined slightly year-over-year despite adding over 17,000 Go Fiber customers over the past year |
| As Chris just mentioned, Glo Fiber revenue was the primary catalyst, growing $16.8 million, or 92%, from the prior year, with strong customer growth of over 71%, and a 4% increase in data subscriber ARPU |
| As you can see on slide four, consolidated revenues and adjusted EBITDA grew approximately 8% and 19%, respectively, driven by Glo Fiber subscriber growth |
| And finally, our churn remained very low at 1.0% for 2023, an improvement of 7 basis points over the prior year, as we continue to focus on providing the fastest speeds in our markets, outstanding local customer service and fair straightforward pricing |
| Consolidated adjusted EBITDA grew 19.3% to $90.6 million, also due to growth in broadband |
| However, our government -- our construction backlog remains very robust with approximately 351,000 incremental fiber passings approved for construction |
| As Jim mentioned, our broadband data average revenue per user increased by 4% year-over-year to over $76, driven by a combination of additional equipment revenue and customers selecting higher speed tiers |
| Broadband data churn was 1.58% for the fourth quarter of 2023, an improvement of 5 basis points year-over-year, as we increased broadband speeds in the second-half of the year, giving customer higher speeds and more value for the same price |
| Consolidated revenue grew 7.5% to $287.4 million in 2023, due to the previously mentioned growth in broadband |
| We had a record quarter for fiber construction, adding over 33,000 new fiber passings and constructing almost 500 new route miles of fiber |
| We expect commercial fiber revenue to return to mid- to high-single-digit growth rates, starting at 2025 |
| We added over 17,000 Glo Fiber net customers, representing a more than 32% increase over 2022 and a 62% annual growth rate since 2020 |
| We expect to accelerate the pace of Glo Giber construction and sales, again, in the next year, continuing the annual improvements we've made in each of the past three years |
| Cable market revenues, excluding the impact of our discontinued Beam service, grew $2.5 million, or 1.4%, due primarily to 1.8% growth in data subscriber ARPU |
| We do believe we'll be able to accelerate that somewhat with the addition of Horizon as well |
| We expect consolidated revenue and adjusted EBITDA to return to similar growth rates in 2025 as we've reported over the past three years |
| Since our first full year of launching Glo Fiber in 2020, our consolidated revenue and adjusted EBITDA have grown at a compound annual growth rate of approximately 9% and 18%, respectively |
| Broadband revenue grew $20.3 million, or 8.1%, to $269.3 million |
| ARPU increased approximately 1.8% year-over-year to $82.75 |
| Our total number of data, video, and voice revenue generating units has reached over 51,000, up approximately 65% year-over-year |
| We added over 86,000 new Go Fiber passings in 2023, almost a 20% increase from 2022 and over a threefold increase from 2020 levels |
| The fourth quarter marked a milestone where Glo Fiber now passes more homes and businesses than our incumbent cable markets |
| We added over 4,300 Glo Fiber customers in the fourth quarter to finish the year at over 41,700, and our data penetration rate reached 17.8%, up from 16.5% at the end of 2022 |
| We look forward to updating you in 2024 of what we expect will be a very exciting year |
| Statement |
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| Our total revenue generating units decreased by about 3% year-over-year as we continued to see declines in video service and residential voice service due to cord cutting |
| Please note that we expect our consolidated revenue and adjusted EBITDA growth rates to slow in 2024 due to the previously mentioned $7 million in expected decline in broadband T-Mobile revenue |
| In 2023, we booked new sales with monthly revenue totaling approximately $350,000, down about 5% year-over-year |
| Tower adjusted EBITDA declined $300,000 to $11.6 million, due primarily to the lower intercompany revenue |
| On slide nine, Tower segment revenue declined slightly to $18.6 million due primarily to lower intercompany revenue from the decommissioning of Beam fixed wireless network in 2022 |
| Negative free cash flow for 2023 was $143 million, or $28 million more than prior year, due primarily to increased investments in expanding Glo Fiber and government subsidized construction to unserved homes, partially offset by $26 million in income tax and sales tax refunds in 2023 |
| Our broadband data penetration decreased slightly year-over-year, from 51.7% at the end of 2022 to 50.8% at the end of 2023 |
| For the entire year, churn was 1.65%, up about 7 basis points year-over-year, due to overbuilder competition in some markets |
| And finally, our total number of towers decreased to 219 as we decommissioned two non-revenue towers and transferred one non-revenue tower to our broadband segment |
| With most of the T-Mobile backhaul disconnects now behind us, we expect commercial fiber revenue in 2024 to decline by $3 million in lower backhaul revenue from a full year of lower T-Mobile backhaul circuits, $3 million in lower nonrecurring early termination fees, and $1 million in additional T-Mobile churn in 2024, partially offset by continued growth in other customer segments |
| Excluding T-Mobile, churn and revenue compression remained low at 0.4% for 2023 |
| And once we complete that project, you should see the cable markets capex come down again |
| We've seen it level off in the past year, but we did see some significant increases before that |
| As Jim mentioned, we expect additional churn as they complete their network turndown this year |
| T-Mobile disconnected 338 backhaul circuits during 2023 as part of the previously announced shutdown of the former Sprint network |
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