While regional carriers might not be able to call their fourth-quarter performances revivals, companies that reported results last week seemed to be stemming the flood of subscriber losses and, unlike national carriers, managed to increase their average revenue per user-though the positives didn’t necessarily put their financials in the black.
Dobson Communications Corp. lost more money but fewer customers in the fourth quarter of 2005 than the fourth quarter of 2004. The operator posted a net customer loss of 22,500 subscribers; in 2004’s fourth quarter, Dobson shed 25,600 customers. Postpaid customer churn was up 11 percent quarter-over-quarter, from 2.35 percent to 2.62 percent.
The company reported a loss of $27.3 million, or 16 cents per share. That loss included getting rid of some debt, repurchasing preferred stock and an income tax benefit of $16.2 million. The company lost 10 cents per share, or $13.9 million, in the same period of 2004.
However, Dobson’s ARPU, which includes postpaid, prepaid and reseller customers along with Eligible Telecommunications Carrier payments, reached $46.10, up 9.3 percent from $42.17 in 2004’s fourth quarter. Total revenue was up 11 percent quarter-over-quarter to $294 million; for the year, revenue increased 15 percent from 2004 to $1.18 billion. Roaming revenue climbed 19 percent from the fourth quarter of 2004 to land at $63.4 million. Dobson noted that roaming revenue accounted for 21.5 percent of its total quarterly revenue, as opposed to 20.1 percent for the same quarter in ’04. The operator’s earnings before interest, taxes, depreciation and amortization for the fourth quarter came in at almost $96 million, an increase of roughly 10 percent from EBITDA in 2004’s fourth quarter. The company’s full-year EBITDA stood at $415 million.
Dobson ended 2005 with about 1.54 million customers, with more than 67 percent of them on GSM calling plans. During the fourth quarter of 2005, about 84,000 subscribers switched to GSM from TDMA, and GSM roaming accounted for approximately 91 percent of roaming traffic, the company reported.
RCC
Rural Cellular Corp. slowed its financial losses in the fourth quarter, although the company still posted a 2005 net loss of $64 million, or $5.62 per share. However, the company added customers for the first time in six quarters.
RCC said it gained 1,000 net customers in 2005’s fourth quarter, even though it bid adieu to the year with 24,000 fewer subscribers overall than it had at the end of 2004. The operator lost postpaid and prepaid subscribers while increasing its wholesale customers by more than 15,000 for the year.
The company’s roaming revenue jumped by 53 percent to $36.3 million, and 90 percent of the roaming minutes during the fourth quarter were carried on RCC’s GSM and CDMA networks, compared to 47 percent a year ago. Service revenue increased 3 percent to $387.8 million for the year, though it decreased slightly in the fourth quarter.
RCC’s ARPU hit $50 for the year, up from $46; for the fourth quarter of 2005, ARPU registered at $51, compared with $48 in the same quarter of 2004. Customer churn, meanwhile, was at 2.7 percent for the quarter and year, compared with 2.4 percent for the same quarter in 2004 and 2.1 percent for the year 2004.
Nextel Partners
Nextel Partners Inc. added 105,400 net customers in the fourth quarter of 2005 and bumped up its ARPU by $1, while maintaining its churn rate at about 1.4 percent, the company reported.
The largest Sprint PCS affiliate is in the process of being purchased by Sprint Nextel Corp. for $6.5 billion; the deal is expected to close in the second quarter. John Chapple, who serves as president, chief executive officer and chairman for Nextel Partners, said he was especially proud of the company’s accomplishments “in light of the ongoing merger activity during the year.”
The company reported service revenue of nearly $1.7 billion for 2005, up 31 percent from 2004 service revenues of $1.29 billion. Fourth-quarter revenues saw a 30-percent jump to $460.5 million. Adjusted EBITDA stood at $575.2 million for the year and $154 million for the quarter; excluding merger and hurricane expenses, adjusted EBITDA was $605.9 million for the year. Diluted net income per share of common stock was $1.96 for the year.
Partners’ ARPU for the fourth quarter and the year checked in at $68, up from $67 for the fourth quarter and end of 2004. When roaming revenues were included, ARPU was about $78 in the fourth quarter and for 2005. The company ended 2005 with 2.018 million customers.
Shentel
Shenandoah Telecommunications postponed the release of its financial results for the fourth quarter and year 2005, citing a delay in completing its annual independent audit. The company did not provide any details about when the results would be available.
Shentel, which provides service in the Mid-Atlantic and Southeast and is a PCS affiliate of Sprint Nextel, reported its customer numbers in January. The operator added about 6,500 net retail customers in the fourth quarter, up 43 percent from the same quarter in 2004. The carrier also added nearly 4,900 wholesale customers. Shentel closed out 2005 with about 123,000 retail customers and roughly 38,700 wholesale customers.
T-Mobile USA, Ubiquitel and Suncom Wireless are scheduled to report their financial results next, while U.S. Cellular Corp.’s latest deadline from the American Stock Exchange to file its third-quarter 2005 results is Feb. 28.
