SureWest reported net income down 95.4% to $959,000 for 2Q 2009 as compared to $20.9 million a year ago, a quarter in which the company recorded a $19 million profit on the sale of wireless assets. Free cash flow rose $13.5 million to a positive $4 million year-to-year, Broadband revenue rose 14% and Broadband EBITDA increased 47% year-to-year.
“We are pleased to report solid revenue and EBITDA results. Strong free cash flow allowed us to pay down debt and increase cash reserves, enhancing our financial flexibility. Significant growth in average revenue per customer highlights our strategy of offering superior services to high-value customers. We also experienced a considerable increase in business services revenue, particularly in the Kansas City market,” president and CEO Steve Oldham said in a news release (LINK: ).
“In recent years, SureWest has committed significant new capital to expand our state-of-the-art fiber network with the long-term goal of growing our subscriber base. Having completed our 2009 network build, we maintain our ability to grow through a number of avenues; most impressive of which is the planned integration of Microsoft Mediaroom into our Sacramento IPTV product this December.”
2Q09 Operating Highlights
- Year-over-year total residential voice loss of 6,400 (5%) compared to the second quarter of 2008 year-over-year loss of 7,800 (6%)
- Of the 4,400 sequential Telecom Residential voice RGU losses, 2,100 migrated to the VoIP service during the second quarter
- Total residential broadband RGUs of 97,700, an increase of 3,700 (4%) y/y
- Residential Video Marketable Homes (FTTH and HFC networks) rose 10% to 238,800 from 217,700 y/y
- Residential Voice marketable homes increased by 17,100 (6%) to 309,300 y/y and 1,100 q/q
- Residential Data marketable homes increased 6% to 309,300 from 292,200
- Broadband Business customers increased 10% y/y and 1% q/q to 6,800
- ARPU for triple play marketable homes (FTTH and HFC networks) rose 5% y/y to $115 from $109 and 2% sequentially from $112
- Brodband churn increased to 1.7% in 2Q from 1.5% a year ago and 1.4% in 1Q
- Telecom residential churn rose to 2.3% from 2.1% y/y and 2.1% last quarter.
2Q09 Financial Highlights
- Total revenue of $60.9 million, up 2% y/y and flat on a percentage basis q/q
- Broadband revenue growth of 14% partially offset Telecom segment revenue decline of 16%
- Broadband residential RGU revenues increased 14% y/y to $29.8 million driven by 9% ARPU growth and an 8% increase in RGUs
- Capex down 56% to $11.17 million from $25.3 million y/y and 39%, from $18.3 million q/q
- Income from continuing operations dropped 48% y/y and increased $820,000 q/q to $899,000
- Telecom Residential revenue dropped 25% y/y and 7% q/q to $6.4 million due to losses in Telecom voice RGUs of 28% y/y and 9% q/q
- Total Business ARPU rose 4% y/y and dropped 2% q/q to $475