The tumultuous times at Ntelos were apparent in the regional wireless operator’s fourth-quarter operating results where net income plunged and customers fled.
Ntelos reported the loss of 8,300 total connections during the final three months of last year, with a vast majority coming from its prepaid services. The losses continued a sequential trend that had the carrier losing 900 total customers during the third quarter, and were a dramatic change from the 7,500 customers the carrier added during Q4 2013.
For the full year, Ntelos lost 5,400 customers compared with a gain of 25,000 customers in 2013. Ntelos ended 2014 with 448,900 total connections on its network.
Impacting customer growth was the one-two punch of lower gross additions and increased customer churn, which increased during Q4 from 3.1% in 2013 to 3.6% last year.
Average revenue per account also dipped year-over-year, falling $4.41 to $132.48 during Q4. The number of lines per account remained stable at 2.2. Ntelos’ management did explain that it was seeing more than half of new customers signing up for multi-line accounts.
Ntelos also saw an expected dip in revenue generated by its network agreement with Sprint, with quarterly revenue dropping from $39.3 million in 2013, to $38.3 million in 2014. The carrier said it expects full year revenue from the partnership to drop from $153 million in 2014, to less than $145 million in 2015 as terms of the deal evolve.
Overall revenue did manage to grow 5% year-over-year for Q4 to $128.3 million. However, expenses nearly doubled, inflating net losses from $784,000 during Q4 2013, to $56.2 million last year.
Ntelos announced late last year plans to exit some of its “eastern” markets, including the sale of spectrum to T-Mobile US in a move to refocus its efforts in its current “western” coverage areas. That decommissioning of services will include closing retail operations and transferring approximately 180,000 current subscribers in those markets to “another carrier.”
Ntelos said the moves to leave its eastern Virginia markets will see it focus efforts on its markets in western Virginia and West Virginia, where it claims to have better competitive footing. The western markets will receive a stronger focus of the carrier’s capital expenditures in terms of continued build-out of LTE services. The western markets currently generate all of the revenue tied to Ntelos’ network agreement with Sprint.
Earlier this year, Ntelos announced plans to sell up to 103 of its towers to an affiliate of private-equity firm Grain Management for approximately $41 million.
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