Consolidated Communications Holdings
Aug 6, 2015

Consolidated Communications Reports Second Quarter 2015 Results

MATTOON, Ill., Aug. 6, 2015 (GLOBE NEWSWIRE) -- Consolidated Communications Holdings, Inc. (Nasdaq:CNSL) reported results for the second quarter 2015.

Second quarter financial summary:

"I am pleased that we continued our progress in executing on our key priorities," said Bob Udell, President and Chief Executive Officer. "The demand for high-bandwidth data services remains strong, and with our fiber-rich network, we are well positioned to continue to take advantage of these opportunities."

"The integration with Enventis is going very well. During the quarter, we achieved an additional $1.0 million in annual synergies reaching over 60% of the original two-year, $14 million target. We are ahead of schedule and have identified additional opportunities for efficiency improvement. Due to these benefits, we now expect to achieve $17.0 million in synergies compared to our original target of $14.0 million," Udell concluded.

"In June, we raised $300.0 million as an add-on to our 6.5% unsecured senior notes due 2022," said Steve Childers, Chief Financial Officer. "These proceeds were used to fully redeem the outstanding principal amount of our 10 7/8% unsecured senior notes that were due 2020, to pay the premium on the redemption, and to reduce the outstanding amount drawn on our revolver. This successful transaction provides us with over $6.0 million in annual interest savings."

Pro Forma Financial Results for the Second Quarter

We have presented various adjusted pro forma information in the following discussion and in the tables at the end of the release. This information is presented as if the acquisition of Enventis had occurred on January 1, 2014 in order to provide a better view of the period over period performance for the combined business.

Financial Results for the Six Months Ended June 30, 2015

Cash Available to Pay Dividends

For the quarter, cash available to pay dividends, or CAPD, was $25.5 million, and the dividend payout ratio was 76.7%. At June 30, 2015, cash and cash equivalents were $6.9 million. Capital expenditures for the quarter were $33.0 million. 

Financial Guidance

Consolidated is updating its full year guidance to reflect the strong demand in fiber based wireless backhaul, commercial sales growth opportunities and the redemption of its 10 7/8% bonds. The table below reflects pro forma results for the full year of 2014.

  2015 Updated Guidance  2015 Previous Guidance  2014 Pro Forma Results 
Cash Interest Expense $76.5 million to $77.5 million $78.0 million to $81.0 million  $81.4 million 
Cash Income Taxes $2.0 million to $3.0 million $4.0 million to $8.0 million  $12.4 million
Capital Expenses* $128.0 million to $132.0 million $122.0 million to $129.0 million $131.3 million
 
*2015 capital guidance includes $5.2 million of integration related expenses. 

Dividend Payments

On August 3, 2015, Consolidated's board of directors declared its next quarterly dividend of $0.38738 per common share, which is payable on November 2, 2015 to stockholders of record at the close of business on October 15, 2015. This will represent the 41st consecutive quarterly dividend paid by the Company. 

Conference Call Information 

The Company will host a conference call today at 11:00 a.m. Eastern Time / 10:00 a.m. Central Time to discuss second quarter earnings and developments with respect to the Company. The call is being webcast and archived on the "Investor Relations" section of the Company's website at http://www.consolidated.com. The conference call dial-in number is 1-877-374-3981 with pass code 83129779. International parties can access the call by dialing 1-253-237-1158. A telephonic replay of the conference call will also be available starting three hours after completion of the call until August 13, 2015 at midnight Eastern Time. To hear the replay, parties in the United States and Canada should call 1-855-859-2056 and international parties should call 1-404-537-3406. 

Use of Non-GAAP Financial Measures

This press release, as well as the conference call, includes disclosures regarding "EBITDA", "adjusted EBITDA", "cash available to pay dividends" and the related "dividend payout ratio", "total net debt to last twelve month adjusted EBITDA coverage ratio", "adjusted diluted net income per share" and "adjusted net income attributable to common stockholders", all of which are non-GAAP financial measures and described in this section as not being in compliance with Regulation S-X. Accordingly, they should not be construed as alternatives to net cash from operating or investing activities, cash and cash equivalents, cash flows from operations, net income or net income per share as defined by GAAP and are not, on their own, necessarily indicative of cash available to fund cash needs as determined in accordance with GAAP. In addition, not all companies use identical calculations, and the non-GAAP financial measures may not be comparable to other similarly titled measures of other companies. A reconciliation of the differences between these non-GAAP financial measures and the most directly comparable financial measures presented in accordance with GAAP is included in the tables that follow.

Adjusted EBITDA is comprised of EBITDA, adjusted for certain items as permitted or required by the lenders under our credit agreement in place at the end of each quarter in the periods presented. The tables that follow include an explanation of how adjusted EBITDA is calculated for each of the periods presented with the reconciliation to net income. EBITDA is defined as net earnings before interest expense, income taxes, depreciation and amortization on a historical basis.   

Cash available to pay dividends represents adjusted EBITDA plus cash interest income less (1) cash interest expense, (2) capital expenditures and (3) cash income taxes; this calculation differs in certain respects from the similar calculation used in our credit agreement. 

We present adjusted EBITDA, cash available to pay dividends and the related dividend payout ratio for several reasons. Management believes adjusted EBITDA, cash available to pay dividends and the dividend payout ratio are useful as a means to evaluate our ability to fund our estimated uses of cash (including interest on our debt) and pay dividends. In addition, we have presented adjusted EBITDA, cash available to pay dividends and the dividend payout ratio to investors in the past because they are frequently used by investors, securities analysts and other interested parties in the evaluation of companies in our industry, and management believes presenting them here provides a measure of consistency in our financial reporting. Adjusted EBITDA and cash available to pay dividends, referred to as Available Cash in our credit agreement, are also components of the restrictive covenants and financial ratios contained in our credit agreement that requires us to maintain compliance with these covenants and limit certain activities, such as our ability to incur debt and to pay dividends. The definitions in these covenants and ratios are based on adjusted EBITDA and cash available to pay dividends after giving effect to specified charges. In addition, adjusted EBITDA, cash available to pay dividends and the dividend payout ratio provide our board of directors with meaningful information to determine, with other data, assumptions and considerations, our dividend policy and our ability to pay dividends under the restrictive covenants in our credit agreement and to measure our ability to service and repay debt.  We present the related "total net debt to last twelve month adjusted EBITDA coverage ratio" principally to put other non-GAAP measures in context and facilitate comparisons by investors, security analysts and others; this ratio differs in certain respects from the similar ratio used in our credit agreement. These measures differ in certain respects from the ratios used in our Senior Notes indenture. 

These non-GAAP financial measures have certain shortcomings. In particular, adjusted EBITDA does not represent the residual cash flows available for discretionary expenditures, since items such as debt repayment and interest payments are not deducted from such measure. Similarly, while we may generate cash available to pay dividends, we are not required to use any such cash to pay dividends, and the payment of any dividends is subject to declaration by our board of directors, compliance with applicable law and the terms of our credit agreement. Because adjusted EBITDA is a component of the dividend payout ratio and the ratio of total net debt to last twelve month adjusted EBITDA, these measures are also subject to the material limitations discussed above. In addition, the ratio of total net debt to last twelve month adjusted EBITDA is subject to the risk that we may not be able to use the cash on the balance sheet to reduce our debt on a dollar-for-dollar basis. Management believes these ratios are useful as a means to evaluate our ability to incur additional indebtedness in the future. 

We present the non-GAAP measures adjusted diluted net income per share and adjusted diluted net income attributable to common stockholders because our net income and net income per share are regularly affected by items that occur at irregular intervals or are non-cash items. We believe that disclosing these measures assists investors, securities analysts and other interested parties in evaluating both our company over time and the relative performance of the companies in our industry.

About Consolidated

Consolidated Communications Holdings, Inc. is a leading communications provider within its 11-state operations. Headquartered in Mattoon, IL, the Company has been providing services in many of its markets for over a century. The Company leverages its advanced fiber optic network to offer a wide range of solutions including: High Speed Internet, Metro Ethernet, Digital TV, Voice, Wireless Backhaul and Cloud and Managed services.

Safe Harbor 

The Securities and Exchange Commission ("SEC") encourages companies to disclose forward-looking information so that investors can better understand a company's future prospects and make informed investment decisions.  Certain statements in this press release are forward-looking statements and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995.  These forward-looking statements reflect, among other things, our current expectations, plans, strategies, and anticipated financial results.  There are a number of risks, uncertainties, and conditions that may cause our actual results to differ materially from those expressed or implied by these forward-looking statements.  These risks and uncertainties include our ability to successfully integrate Enventis' operations and realize the synergies from the acquisition, as well as a number of factors related to our business, including economic and financial market conditions generally and economic conditions in our service areas; various risks to shareholders of not receiving dividends and risks to our ability to pursue growth opportunities if we continue to pay dividends according to the current dividend policy; various risks to the price and volatility of our common stock; changes in the valuation of pension plan assets; the substantial amount of debt and our ability to repay or refinance it or incur additional debt in the future; our need for a significant amount of cash to service and repay the debt and to pay dividends on the common stock; restrictions contained in our debt agreements that limit the discretion of management in operating the business; regulatory changes, including changes to subsidies, rapid development and introduction of new technologies and intense competition in the telecommunications industry; risks associated with our possible pursuit of acquisitions; system failures; losses of large customers or government contracts; risks associated with the rights-of-way for the network; disruptions in the relationship with third party vendors; losses of key management personnel and the inability to attract and retain highly qualified management and personnel in the future; changes in the extensive governmental legislation and regulations governing telecommunications providers and the provision of telecommunications services; telecommunications carriers disputing and/or avoiding their obligations to pay network access charges for use of our network; high costs of regulatory compliance; the competitive impact of legislation and regulatory changes in the telecommunications industry; and liability and compliance costs regarding environmental regulations. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements are discussed in more detail in our filings with the Securities and Exchange Commission, including our reports on Form 10-K and Form 10-Q. Many of these circumstances are beyond our ability to control or predict.  Moreover, forward-looking statements necessarily involve assumptions on our part.  These forward-looking statements generally are identified by the words "believe", "expect", "anticipate", "estimate", "project", "intend", "plan", "should", "may", "will", "would", "will be", "will continue" or similar expressions.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of Consolidated Communications Holdings, Inc. and its subsidiaries to be different from those expressed or implied in the forward-looking statements.  All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements that appear throughout this press release.  Furthermore, forward-looking statements speak only as of the date they are made.  Except as required under the federal securities laws or the rules and regulations of the Securities and Exchange Commission, we disclaim any intention or obligation to update or revise publicly any forward-looking statements. You should not place undue reliance on forward-looking statements.

Consolidated Communications Holdings, Inc.
Condensed Consolidated Balance Sheets
(Dollars in thousands, except par value)
(Unaudited)
  June 30,  December 31, 
  2015  2014 
   
ASSETS     
Current assets:     
Cash and cash equivalents   $ 6,946  $ 6,679
Accounts receivable, net   87,096  77,536
Income tax receivable   25,195  18,940
Deferred income taxes   13,374  13,374
Prepaid expenses and other current assets   20,093  17,616
Total current assets   152,704  134,145
     
Property, plant and equipment, net   1,122,652  1,137,478
Investments   115,688  115,376
Goodwill   764,630  764,630
Other intangible assets   50,146  56,322
Deferred debt issuance costs, net and other assets   16,600  19,313
Total assets   $ 2,222,420  $ 2,227,264
     
LIABILITIES AND SHAREHOLDERS' EQUITY     
Current liabilities:     
Accounts payable   $ 23,228  $ 15,277
Advance billings and customer deposits   31,567  31,933
Dividends payable   19,566  19,510
Accrued compensation   21,615  32,581
Accrued interest   9,183  6,784
Accrued expense   39,012  39,698
Current portion of long-term debt and capital lease obligations   10,102  9,849
Current portion of derivative liability   297  443
Total current liabilities   154,570  156,075
     
Long-term debt and capital lease obligations   1,406,566  1,356,753
Deferred income taxes   247,031  246,665
Pension and other post-retirement obligations   113,154  122,363
Other long-term liabilities   14,967  14,579
Total liabilities   1,936,288  1,896,435
     
Shareholders' equity:     
Common stock, par value $0.01 per share; 100,000,000 shares authorized, 50,509,148 and 50,364,579, shares outstanding as of June 30, 2015 and December 31, 2014, respectively   505  504
Additional paid in capital   311,827  357,139
Accumulated other comprehensive loss, net   (31,085)  (31,640)
Noncontrolling interest  4,885  4,826
Total shareholders' equity  286,132  330,829
Total liabilities and shareholders' equity  $ 2,222,420  $ 2,227,264
 
 
Consolidated Communications Holdings, Inc.
Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
(Unaudited)
     
  Three Months Ended  Six Months Ended 
  June 30,  June 30, 
  2015  2014  2015  2014 
     
     
Net revenues   $ 201,010  $ 151,036  $ 393,588  $ 300,684
Operating expenses:         
Cost of services and products   86,376  55,918  166,268  111,218
Selling, general and administrative expenses   43,085  32,711  85,033  65,286
Acquisition and other transaction costs   223  977  660  1,266
Depreciation and amortization   43,651  36,005  87,207  71,547
Income from operations   27,675  25,425  54,420  51,367
Other income (expense):         
Interest expense, net of interest income   (20,429)  (19,728)  (41,103)  (39,559)
Loss on extinguishment of debt   (41,242)  --   (41,242)  -- 
Other income, net   8,964  9,061  15,348  16,494
Income (loss) before income taxes   (25,032)  14,758  (12,577)  28,302
Income tax expense (benefit)   (9,104)  4,871  (4,478)  9,993
Net income (loss)   (15,928)  9,887  (8,099)  18,309
         
Less: net income attributable to noncontrolling interest   40  80  59  178
         
Net income (loss) attributable to common shareholders   $ (15,968)  $ 9,807  $ (8,158)  $ 18,131
         
Net income (loss) per basic and diluted common share attributable to common shareholders $ (0.32)  $ 0.24  $ (0.16)  $ 0.45
 
 
Consolidated Communications Holdings, Inc.
Pro Forma Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
(Unaudited)
     
  Three Months Ended  Six Months Ended 
  June 30,  June 30, 
   Pro Forma   Pro Forma 
  2015  2014  2015  2014 
     
     
Net revenues   $ 201,010  $ 200,760  $ 393,588  $ 394,648
Operating expenses:         
Operating expenses (exclusive of depreciation and amortization)   129,684  125,763  251,961  246,094
Depreciation and amortization   43,651  47,861  87,207  95,259
Income from operations   27,675  27,136  54,420  53,295
Other income (expense):         
Interest expense, net of interest income   (20,429)  (21,828)  (41,103)  (43,779)
Loss on extinguishment of debt   (41,242)  --   (41,242)  -- 
Other income, net   8,964  9,061  15,348  16,494
Income (loss) from before income taxes   (25,032)  14,369  (12,577)  26,010
Income tax expense (benefit)   (9,104)  4,767  (4,478)  9,217
Net Income (loss)   (15,928)  9,602  (8,099)  16,793
Less: net income attributable to noncontrolling interest   40  80  59  178
         
Net income (loss) attributable to common shareholders   $ (15,968)  $ 9,522  $ (8,158)  $ 16,615
         
Net income (loss) per basic and diluted common share attributable to common shareholders  $ (0.32)  $ 0.19  $ (0.16)  $ 0.33
 
 
Consolidated Communications Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)
        
  Three Months Ended  Six Months Ended 
  June 30,  June 30, 
  2015  2014  2015  2014 
OPERATING ACTIVITIES    
Net income  $ (15,928)  $ 9,887  $ (8,099)  $ 18,309
Adjustments to reconcile net income to cash provided by operating activities:        
Depreciation and amortization  43,651  36,005  87,207  71,547
Deferred income taxes  5  (535)  5  (535)
Cash distributions from wireless partnerships in excess of/(less than) earnings  (1,914)  (706)  (1,556)  23
Non- cash stock-based compensation  710  940  1,523  1,724
Amortization of deferred financing  879  711  1,822  1,341
Loss on extinguishment of debt  41,242  --   41,242  -- 
Other adjustments, net  12  512  698  1,903
Changes in operating assets and liabilities, net  (25,245)  (8,163)  (27,026)  (7,267)
Net cash provided by operating activities  43,412  38,651  95,816  87,045
INVESTING ACTIVITIES        
Purchase of property, plant and equipment, net  (32,986)  (25,041)  (65,538)  (50,446)
Proceeds from sale of assets  28  9  57  1,250
Proceeds from the sale of investments  846  --   846  -- 
Net cash used in investing activities  (32,112)  (25,032)  (64,635)  (49,196)
FINANCING ACTIVITIES        
Proceeds on bond offering  294,780  --   294,780  -- 
Proceeds on issuance of long-term debt  20,000  16,000  40,000  26,000
Payment of capital lease obligation  (222)  (160)  (444)  (317)
Payment on long-term debt  (42,275)  (13,275)  (59,550)  (30,550)
Redemption of senior notes  (261,874)  --   (261,874)  -- 
Payment of financing costs  (4,468)  (2,524)  (4,468)  (2,524)
Share repurchases for minimum tax withholding  (68)  --   (282)  -- 
Dividends on common stock  (19,566)  (15,607)  (39,076)  (31,127)
Net cash used in financing activities  (13,693)  (15,566)  (30,914)  (38,518)
Net change in cash and cash equivalents  (2,393)  (1,947)  267  (669)
Cash and cash equivalents at beginning of period  9,339  6,829  6,679  5,551
Cash and cash equivalents at end of period  $ 6,946  $ 4,882  $ 6,946  $ 4,882
 
 
Consolidated Communications Holdings, Inc.
Consolidated Revenue by Category
(Dollars in thousands)
 (Unaudited) 
       
 PRO FORMA  
 Q2'14Q3'14Q4'14Q1'15Q2'15
Commercial and carrier:     
Data and transport services (includes VoIP)  $ 41,924  $ 42,831  $ 43,392  $ 45,055  $ 45,049
Voice services  27,188  26,834  26,346  26,055  26,213
Other  3,102  2,984  3,414  2,596  2,841
   72,214  72,649  73,152  73,706  74,103
Consumer:          
Broadband (VoIP, Data and Video)  53,806  53,516  53,394  53,725  54,051
Voice services  16,752  16,688  16,085  15,556  15,120
   70,558  70,204  69,479  69,281  69,171
           
Equipment Sales and Service  17,441  22,258  11,062  10,853  19,309
Subsidies  14,851  14,040  14,348  14,392  14,516
Network Access  20,802  19,680  19,789  19,399  19,056
Other products and services  4,894  4,618  4,818  4,947  4,855
Total operating revenue  $ 200,760  $ 203,449  $ 192,648  $ 192,578  $ 201,010
 
 
Consolidated Communications Holdings, Inc.
Consolidated Revenue by Category
(Dollars in thousands)
 (Unaudited) 
       
 PRO FORMA  
 Q2'14Q3'14Q4'14Q1'15Q2'15
           
Local calling service  30,980  30,472  29,905  29,281  29,246
Network access revenues  29,252  28,439  28,370  28,451  28,557
Subsidies  14,851  14,040  14,348  14,392  14,516
Long distance services  5,922  5,778  5,613  5,628  6,132
Data and internet service  81,696  82,031  82,153  84,260  83,585
Equipment sales and services  17,407  22,224  11,008  10,853  19,309
Other services  20,652  20,465  21,251  19,713  19,665
Total  200,760  203,449  192,648  192,578  201,010
 
 
Consolidated Communications Holdings, Inc.
Schedule of Adjusted EBITDA Calculation
(Dollars in thousands)
(Unaudited)
         
         
  Three Months Ended  Six Months Ended 
  June 30,  June 30, 
   Pro forma   Pro forma 
  2015  2014  2015  2014 
Net income (loss)  $ (15,928)  $ 9,602  $ (8,099)  $ 16,793
Add (subtract):        
Income tax expense (benefit)  (9,104)  4,767  (4,478)  9,217
Interest expense, net  20,429  21,828  41,103  43,779
Depreciation and amortization  43,651  47,861  87,207  95,259
EBITDA  39,048  84,058  115,733  165,048
         
Adjustments to EBITDA (1):        
Other, net (2)  33,501  (9,660)  28,600  (17,328)
Investment distributions (3)  7,087  8,706  14,166  17,792
Non-cash compensation (4)  710  1,132  1,523  2,147
Adjusted EBITDA  $ 80,346  $ 84,236  $ 160,022  $ 167,659
         
Footnotes for Adjusted EBITDA:        
(1) These adjustments reflect those required or permitted by the lenders under our credit agreement.
(2) Other, net includes the equity earnings from our investments, dividend income, income attributable to noncontrolling interests in subsidiaries, acquisition and non-recurring related costs and certain miscellaneous items.
(3) Includes all cash dividends and other cash distributions received from our investments.
(4) Represents compensation expenses in connection with our Restricted Share Plan, which because of the non-cash nature of the expenses are excluded from adjusted EBITDA.
     
Consolidated Communications Holdings, Inc.
Cash Available to Pay Dividends
(Dollars in thousands)
(Unaudited)
    
  Three Months Ended  Six Months Ended 
  June 30, 2015  June 30, 2015 
   
Adjusted EBITDA  $ 80,346  $ 160,022
     
- Cash interest expense  (19,853)  (39,838)
- Capital expenditures  (32,986)  (65,538)
- Cash income taxes  (1,985)  (1,788)
     
Cash available to pay dividends  $ 25,522  $ 52,858
     
Dividends Paid  $ 19,566  $ 39,076
Payout Ratio 76.7% 73.9%
     
* The above calculation excludes the principal payments on the amortization of our debt
     
Consolidated Communications Holdings, Inc.
Total Net Debt to LTM Adjusted EBITDA Ratio
(Dollars in thousands)
(Unaudited)
  
Summary of Outstanding Debt 
Term loan, net of discount $3,646  $ 892,704
Revolving loan  24,000
Senior unsecured notes due 2022, net of discount $5,174  494,826
Capital leases  5,138
Total debt as of June 30, 2015  $ 1,416,668
Less cash on hand  (6,946)
Total net debt as of June 30, 2015  $ 1,409,722
   
Adjusted EBITDA for the last twelve months ended June 30, 2015  $ 320,417
   
Total Net Debt to last twelve months  
Adjusted EBITDA  4.40x
 
 
Consolidated Communications Holdings, Inc.
Adjusted Net Income and Net Income Per Share
(in thousands, except per share amounts)
(Unaudited)
         
  Three Months Ended  Six Months Ended 
    Pro Forma    Pro Forma 
  June 30,  June 30,  June 30,  June 30, 
  2015  2014  2015  2014 
Net income (loss)  $ (15,928)  $ 9,602  $ (8,099)  $ 16,793
Transaction and severance related costs, net of tax  1,173  --  2,564  --
Loss on extinguishment of debt, net of tax  26,230  --  26,560  --
Loss related to sale of building, net of tax  --  --  --  477
Impairment charge for CVIN investment, net of tax  --  --  539  --
Non-cash stock compensation, net of tax 452 756 981 1,387
Adjusted net income  $ 11,927  $ 10,358  $ 22,545  $ 18,657
         
Weighted average number of shares outstanding  50,175  50,021  50,161  50,021
Adjusted diluted net income per share  $ 0.24  $ 0.21  $ 0.45  $ 0.37
         
* Calculations above assume a 36.4% and 33.2% effective tax rate for the three months ended and 35.6% and 35.4% for the six months ended June 30, 2015 and 2014, respectively.
     
Consolidated Communications Holdings, Inc.
Key Operating Statistics
(Unaudited)
           
 30-Jun-1531-Mar-15% Change in Qtr30-Jun-14% Change yoy
           
Voice Connections 493,540 498,121 (0.9%) 514,875 (4.1%)
           
Data and Internet Connections 448,944 446,621 0.5% 438,903 2.3%
           
Video Connections 122,155 123,208 (0.9%) 124,289 (1.7%)
           
Business and Broadband as % of total revenue 80% 79% 1.3% 79% 1.3%
           
Fiber route network miles (long-haul and metro) 13,262 13,038 1.7% 12,400 7.0%
           
On-net buildings 4,840 4,804 0.7% 4,660 3.9%
           
Consumer Customers 272,882 274,484 (0.6%) 285,469 (4.4%)
           
Consumer ARPU $84.50 $84.13 0.4% $82.39 2.6%
           
Note:          
BB% includes commercial/carrier, equipment sales and service, directory, consumer broadband and special access
All periods are pro forma for the Enventis acquisition
CONTACT: Company Contact:

         Matt Smith

         Treasurer and VP of Finance & IR

         217-258-2959

         matthew.smith@consolidated.com