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Consolidated Communications Reports Fourth Quarter 2014 Results

  • Increased commercial and carrier revenue by 4.2% year over year led by our Metro Ethernet services
  • Delivered over 2,000 net data adds in the quarter and a 3.2% year over year increase in pro forma data and internet revenues
  • Successfully closed on the acquisition of Enventis expanding and diversifying into an additional five states
  • Generated $4.5 million in synergies at close and an additional $1.0 million by year-end
  • Repurchased $72.8 million of senior notes due 2020 resulting in approximately $4.0 million of annualized interest savings

MATTOON, Ill., Feb. 26, 2015 (GLOBE NEWSWIRE) -- Consolidated Communications Holdings, Inc. (Nasdaq:CNSL) reported results for the fourth quarter and full year 2014.

Fourth quarter financial summary:

  • Pro forma revenue was $192.6 million.
  • Net cash from continuing operations was $54.4 million.
  • Pro forma Adjusted EBITDA was $80.6 million.
  • Dividend payout ratio was 63.4%.

"Consolidated's fourth quarter capped off another solid year for the Company," said Bob Udell, President and Chief Executive Officer. "Our strategic focus on delivering high bandwidth data services and solutions to businesses and consumers has continued our successful transition to a broadband driven company. During the quarter, we added over 2,000 net data connections and increased the percentage of revenues from business and broadband to 80% of total revenues."

"We are excited about the opportunities with the Enventis acquisition and are continuing to execute on our integration and synergy plans. The combined business has greater scale and creates opportunities for growth and expansion, all of which provide benefits to our shareholders, customers and employees," Udell concluded.

Operating Statistics at December 31, 2014, Compared to Pro Forma December 31, 2013.

Period Ended December 31,
2014 2013 Increase/(decrease) %
Data connections 289,658 281,079 8,579 3.1%
Video connections 122,832 122,292 540 0.5%
Voice connections 436,962 458,065 (21,103) (4.6%)
Total connections 849,452 861,436 (11,984) (1.4%)

"During September, we raised and escrowed $200.0 million in 6.5% unsecured senior notes due 2022," said Steve Childers, Chief Financial Officer. "At the close of the Enventis acquisition, we used approximately $150.0 million of the new bond proceeds to retire Enventis' debt. During the fourth quarter, we used excess bond proceeds of $50.0 million, as well as cash on hand and the revolver to fund two repurchases of our 10 7/8% unsecured senior notes due 2020. In total, we retired $72.8 million principal amount of the 2020 notes, which will result in approximately $4.0 million in annualized cash interest savings."

Cash Available to Pay Dividends

For the quarter, cash available to pay dividends, or CAPD, was $24.6 million, and the dividend payout ratio was 63.4%. At December 31, 2014, cash and cash equivalents were $6.7 million. Pro forma capital expenditures for the quarter were $35.4 million.

Pro Forma Financial Results for the Fourth Quarter

  • Revenues were $192.6 million, compared to $194.2 million for the fourth quarter of 2013. Increases in data and internet revenues and subsidies were more than offset by declines in local calling and network access revenues.
  • Income from operations was $25.9 million, compared to $22.4 million in the fourth quarter of 2013. The increase was primarily due to synergy realization from the Enventis acquisition and efficiency improvements.
  • Interest expense, net was $22.3 million, compared to $22.0 million for the same period last year. The increase was mostly attributable to the $200.0 million in senior notes due 2022 raised for the Enventis acquisition and held in escrow for approximately six weeks prior to the close of the acquisition.
  • Other income, net was a loss of $5.3 million, compared to income of $3.1 million for the same period in 2013. The fourth quarter of 2014 included a $13.8 million loss on the extinguishment of debt for bond repurchases compared to a $7.7 million loss on extinguishment of debt for the successful refinancing of our secured bank facility in the fourth quarter of 2013. Cash distributions from our Verizon Wireless partnerships were $9.2 million compared to $10.5 million for the fourth quarter of 2013.
  • Adjusted diluted net income per share excludes items in the manner described in the table provided in this release. Adjusted diluted net income per share for the current quarter was $0.16 compared to $0.15 for the prior year period. In addition to the loss on the extinguishment of debt, the current period also included material transaction related costs. Prior to the adjustments, diluted net loss per common share was $0.12 compared to net income of $0.04 in the fourth quarter of 2013.
  • Adjusted EBITDA was $80.6 million compared to $82.3 million for the same period in 2013.
  • The total net debt to last twelve month adjusted EBITDA coverage ratio was 4.15 times to one.

Pro Forma Financial Results the Twelve Months Ended December 31, 2014

  • Revenues were $790.7 million and adjusted EBITDA was $328.1 million.

GAAP Financial Results for the Fourth Quarter

  • In the fourth quarter under Generally Accepted Accounting Principles (GAAP), revenues were $186.0 million, income from operations was $15.6 million and net loss was $10.7 million, or $0.22 per share.
  • GAAP results include approximately $10.8 million in pre-tax acquisition and transaction related costs and $13.8 million in a pre-tax loss on extinguishment of debt.

Financial Guidance

The Company is providing the following full year guidance. The table below reflects pro forma results for the full year of 2014.

2015 Guidance 2014 Pro Forma Results
Cash Interest Expense $78.0 million to $81.0 million $81.4 million
Cash Income Taxes $4.0 million to $8.0 million $12.4 million
Capital Expenses* $122.0 million to $129.0 million $131.3 million

*2015 capital guidance includes $5.2 million of integration related expenses.

Dividend Payments

On February 20, 2015, the Company's board of directors declared its next quarterly dividend of $0.38738 per common share, which is payable on May 1, 2015 to stockholders of record at the close of business on April 15, 2015. This will represent the 39th 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 fourth quarter and full year 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. If you do not have internet access, the conference call dial-in number is 1-877-374-3981 with pass code 66508698. 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 March 5, 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 eleven 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 and multiple data centers to offer a wide range of communications services, including data, voice, video, managed services, cloud computing and wireless backhaul.

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.

- Tables Follow –

Consolidated Communications Holdings, Inc.
Condensed Consolidated Balance Sheets
(Dollars in thousands, except par value)
(Unaudited)
December 31, December 31,
2014 2013
ASSETS
Current assets:
Cash and cash equivalents $ 6,679 $ 5,551
Accounts receivable, net 77,536 52,033
Income tax receivable 18,940 9,796
Deferred income taxes 13,374 7,960
Prepaid expenses and other current assets 17,616 12,380
Total current assets 134,145 87,720
Property, plant and equipment, net 1,135,333 885,362
Investments 115,376 113,099
Goodwill 765,806 603,446
Other intangible assets 50,292 40,084
Deferred debt issuance costs, net and other assets 19,313 17,667
Total assets $ 2,220,265 $ 1,747,378
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 15,277 $ 4,885
Advance billings and customer deposits 31,933 25,934
Dividends payable 19,510 15,520
Accrued compensation 32,581 22,252
Accrued interest 6,784 3,524
Accrued expense 39,698 35,173
Current portion of long-term debt and capital lease obligations 9,849 9,751
Current portion of derivative liability 443 660
Total current liabilities 156,075 117,699
Long-term debt and capital lease obligations 1,356,753 1,212,134
Deferred income taxes 243,576 179,859
Pension and other post-retirement obligations 122,367 75,754
Other long-term liabilities 14,581 9,593
Total liabilities 1,893,352 1,595,039
Shareholders' equity:
Common stock, par value $0.01 per share; 100,000,000 shares authorized, 50,364,579 and 40,065,246, shares outstanding as of December 31, 2014 and December 31, 2013, respectively 504 401
Additional paid in capital 357,139 148,433
Accumulated other comprehensive loss, net (35,556) (1,000)
Noncontrolling interest 4,826 4,505
Total shareholders' equity 326,913 152,339
Total liabilities and shareholders' equity $ 2,220,265 $ 1,747,378
Consolidated Communications Holdings, Inc.
Condensed Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2014 2013 2014 2013
Net revenues $ 186,014 $ 147,956 $ 635,738 $ 601,577
Operating expenses:
Cost of services and products 75,008 55,678 242,661 222,452
Selling, general and administrative expenses 42,691 35,029 140,636 135,414
Acquisition and other transaction costs 9,822 64 11,817 776
Depreciation and amortization 42,920 34,968 149,435 139,274
Income from operations 15,573 22,217 91,189 103,661
Other income (expense):
Interest expense, net of interest income (22,257) (19,838) (82,537) (85,767)
Loss on extinguishment of debt (13,785) (7,657) (13,785) (7,657)
Other income, net 8,446 10,787 33,548 37,239
Income (loss) from continuing operations before income taxes (12,023) 5,509 28,415 47,476
Income tax expense (benefit) (1,353) 2,293 13,027 17,512
Income (loss) from continuing operations (10,670) 3,216 15,388 29,964
Income (loss) from discontinued operations, net of tax -- -- -- (156)
Gain on sale of discontinued operations, net of tax -- -- -- 1,333
Total discontinued operations -- -- -- 1,177
Net income (loss) (10,670) 3,216 15,388 31,141
Less: net income attributable to noncontrolling interest 36 76 321 330
Net income (loss) attributable to common shareholders $ (10,706) $ 3,140 $ 15,067 $ 30,811
Net income (loss) per common share - basic and diluted
Income (loss) from continuing operations $ (0.22) $ 0.08 $ 0.35 $ 0.73
Income from discontinued operations, net of tax -- -- -- 0.03
Net income (loss) per basic and diluted common share attributable to common shareholders $ (0.22) $ 0.08 $ 0.35 $ 0.76
Consolidated Communications Holdings, Inc.
Pro Forma Condensed Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
Pro Forma Pro Forma Pro Forma Pro Forma
2014 2013 2014 2013
Net revenues $ 192,648 $ 194,158 $ 790,745 $ 790,777
Operating expenses:
Operating expenses (exclusive of depreciation and amortization) 121,878 124,957 499,093 500,902
Depreciation and amortization 44,896 46,824 186,978 186,697
Income from operations 25,874 22,377 104,674 103,178
Other income (expense):
Interest expense, net of interest income (22,266) (21,958) (87,820) (94,246)
Loss on extinguishment of debt (13,785) (7,657) (13,785) (7,657)
Other income, net 8,446 10,787 33,548 37,239
Income (loss) from before income taxes (1,731) 3,549 36,617 38,514
Income tax expense 4,245 1,605 17,969 14,226
Net Income (loss) (5,976) 1,944 18,648 24,288
Less: net income attributable to noncontrolling interest 36 76 321 330
Net income (loss) attributable to common shareholders $ (6,012) $ 1,868 $ 18,327 $ 23,958
Net income (loss) per common share attributable to common shareholders
Net income (loss) per common share - basic and diluted $ (0.12) $ 0.04 $ 0.37 $ 0.48
Consolidated Communications Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2014 2013 2014 2013
OPERATING ACTIVITIES
Net income (loss) $ (10,670) $ 3,216 $ 15,388 $ 31,141
Loss from discontinued operations, net of tax -- -- -- (1,177)
Net income from continuing operations (10,670) 3,216 15,388 29,964
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization 42,920 34,968 149,435 139,274
Deferred income taxes 11,202 15,791 10,244 16,045
Cash distributions from wireless partnerships in excess of/(less than) earnings 996 47 212 (2,949)
Non- cash stock-based compensation 964 794 3,636 3,028
Amortization of deferred financing 1,250 506 4,364 2,209
Loss on extinguishment of debt 13,785 7,657 13,785 7,657
Other adjustments, net 1,381 179 2,973 1,788
Changes in operating assets and liabilities, net (7,407) (19,264) (12,252) (28,486)
Net cash provided by continuing operations 54,421 43,894 187,785 168,530
Net cash used in discontinued operations -- (179) -- (4,174)
Net cash provided by operating activities 54,421 43,715 187,785 164,356
INVESTING ACTIVITIES
Business acquisition, net of cash acquired (139,558) -- (139,558) --
Purchase of property, plant and equipment, net (32,960) (26,779) (108,998) (107,363)
Purchase of investments (100) (165) (100) (403)
Proceeds from sale of assets 232 219 1,795 330
Restricted cash related to acquisition 149,917 -- -- --
Net cash used in continuing operations (22,469) (26,725) (246,861) (107,436)
Net cash provided by discontinued operations -- -- -- 2,331
Net cash used in investing activities (22,469) (26,725) (246,861) (105,105)
FINANCING ACTIVITIES
Proceeds from bond offering -- -- 200,000 --
Restricted cash on bond offering 54,886 -- --
Proceeds on issuance of long-term debt 52,000 932,450 80,000 989,450
Payment of capital lease obligation (222) (148) (703) (516)
Payment on long-term debt (30,275) (927,031) (63,100) (990,961)
Partial redemption of senior notes due 2020 (84,127) -- (84,127) --
Repurchase and retirement of common stock (1,856) (887) (1,856) (887)
Payment on financing costs (4,731) (6,576) (7,438) (6,576)
Other (231) -- (231)
Dividends on common stock (15,607) (15,538) (62,341) (62,064)
Net cash provided by (used in) financing activities (30,163) (17,730) 60,204 (71,554)
Net change in cash and cash equivalents 1,789 (740) 1,128 (12,303)
Cash and cash equivalents at beginning of period 4,890 6,291 5,551 17,854
Cash and cash equivalents at end of period $ 6,679 $ 5,551 $ 6,679 $ 5,551
Consolidated Communications Holdings, Inc.
Consolidated Revenue by Category
(Dollars in thousands)
(Unaudited)
PRO FORMA
Q4'13 Q1'14 Q2'14 Q3'14 Q4'14
Local calling service 30,831 30,436 30,980 30,472 29,905
Network access revenues 30,138 30,044 29,252 28,439 28,370
Subsidies 12,928 14,667 14,851 14,040 14,348
Long distance services 5,837 5,964 5,922 5,778 5,613
Data and internet service 79,626 79,951 81,696 82,031 82,153
Equipment sales and services 13,992 12,248 17,407 22,224 11,008
Other services 20,806 20,578 20,652 20,465 21,251
Total 194,158 193,888 200,760 203,449 192,648
Consolidated Communications Holdings, Inc.
Schedule of Adjusted EBITDA Calculation
(Dollars in thousands)
(Unaudited)
Three Months Ended Twelve Months Ended Three Months Ended
December 31, December 31, December 31, 2014
Pro forma Pro forma Pro forma Pro forma Including Enventis
2014 2013 2014 2013 10/16 - 12/31
Net income from continuing operations $ (5,976) $ 1,944 $ 18,648 $ 24,288 $ (10,670)
Add (subtract):
Income tax expense (benefit) 4,245 1,605 17,969 14,226 (1,353)
Interest expense, net 22,266 21,958 87,820 94,246 22,257
Depreciation and amortization 44,896 46,824 186,978 186,697 42,920
EBITDA 65,431 72,331 311,415 319,457 53,154
Adjustments to EBITDA (1):
Other, net (2) (8,860) (9,238) (36,048) (30,608) 1,757
Loss on extinguishment of debt 13,785 7,657 13,785 7,657 13,785
Investment distributions (3) 9,244 10,517 34,600 34,833 9,244
Non-cash compensation (4) 1,014 1,001 4,301 3,851 964
Adjusted EBITDA $ 80,614 $ 82,268 $ 328,053 $ 335,190 $ 78,904
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)
Including Enventis for Pro Forma including Enventis for
10/16 - 12/31 10/1 - 12/31
Adjusted EBITDA $ 78,904 $ 80,614
- Cash interest expense (21,171) (21,408)
- Capital expenditures (32,960) (35,414)
- Cash income taxes (146) (146)
Cash available to pay dividends $ 24,627 $ 23,646
Dividends Paid $ 15,607 $ 16,620
Payout Ratio 63.4% 70.3%
* 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 $3,948 $ 896,952
Revolving loan 39,000
Senior unsecured notes due 2020, net of discount of $1,121 226,097
Senior unsecured notes due 2022 200,000
Capital leases 4,553
Total debt as of December 31, 2014 $ 1,366,602
Less cash on hand (6,679)
Total net debt as of December 31, 2014 $ 1,359,923
Adjusted EBITDA for the last twelve months ended December 31, 2014 $ 328,053
Total Net Debt to last twelve months Adjusted EBITDA 4.15x
Consolidated Communications Holdings, Inc.
Adjusted Net Income and Net Income Per Share
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31, December 31, December 31,
2014 2013 2014 2013
Net income (loss) $ (5,976) $ 1,944 $ 18,648 $ 24,288
Transaction and severance related costs, net of tax 823 637 1,626 3,454
Loss on extinguishment of debt 12,233 4,472 7,471 4,832
Loss related to sale of building, net of tax -- -- 401 --
Gain on the sale of discontinued operations, net of tax -- -- -- (1,333)
Non-cash stock compensation, net of tax 900 585 2,331 2,430
Adjusted net income $ 7,980 $ 7,638 $ 30,478 $ 33,671
Weighted average number of shares outstanding 50,053 49,934 50,030 49,908
Adjusted diluted net income per share $ 0.16 $ 0.15 $ 0.61 $ 0.67
* Calculations above assume a 11.3% and 41.6% effective tax rate for the three months ended December 31, 2014 and 2013, respectively and 45.8% and 36.9% for the twelve months ended December 31, 2014 and 2013, respectively.
Consolidated Communications Holdings, Inc.
Key Operating Statistics
(Unaudited)
Pro Forma
December 31, September 30,
2014 2014
ILEC access lines
Residential 151,359 154,596
Business 118,149 120,102
Total local access lines 269,508 274,698
Quarterly change (1.9%)
Voice Connections (non-ILEC) [1,2]
Residential 72,145 73,890
Business 95,309 94,072
Total voice connections 167,454 167,962
Quarterly change (0.3%)
Data and Internet Connections [2] 289,658 287,625
Quarterly change 0.7%
Res. penetration of marketable homes 30.6% 30.7%
Video Connections [2] 122,832 123,252
Quarterly change (0.3%)
Res. penetration of marketable homes 20.9% 21.0%
Total Connections 849,452 853,537
Quarterly change (0.5%)
Network Stats - Marketable Homes
Fiber homes 208,311 206,665
HFC homes 94,617 94,609
Copper homes 452,997 452,997
Total 755,925 754,271
Note: The figures in the table, excluding ILEC access lines, do not entirely include SureWest business subscribers.
[1] These include voice lines outside the ILECs and Voice-over-IP inside the ILECs.
[2] These connections are both residential and business (excluding SureWest business subscribers). They include services both inside and outside the ILECs.

CONTACT: Matt Smith Treasurer and VP of Finance & IR 217-258-2959 matthew.smith@consolidated.com

Source:Consolidated Communications Holdings, Inc.