Lumos Reports, Shifts From Dividend to FTTC, Lights New Route

After the market closed yesterday, Lumos Networks reported stronger than anticipated Q4/2014 revenues, lit up a new fiber route, and suspended its quarterly dividend.

Revenues of $50.7M were about $1M above expectations and up sequentially for the first time in a while. Adjusted EBITDA was $21.9M, while earnings per share came in at the expected $0.15. Lumos expects data revenues to grow 9% to $116M in 2015, while adding another 550 FTTC connections to reach $1,700 by the end of the year.

On the fiber front, Lumos has formally lit up its 115 mile Richmond-Ashburn longhaul route with 100G DWDM gear, connecting two key markets on its southeastern expansion front. Lumos has been actively building its own fiber on some routes in Virginia, but as we learned in this interview with CEO Tim Biltz last autumn, this one is via a fiber IRU — likely the one SummitIG finished building recently along I-95.

Lumos sees a lot of opportunity ahead to spend its cash flows, and as part of yesterday’s announcement they suspended their dividend in favor of the pursuit of faster organic growth. The $12-13M of cash that frees up will go toward FTTC and other network expansion opportunities. And one piece of that, Lumos’s anticipated completion date for their 665 route mile expansion in Richmond, Hampton Roads, Petersburg, and Norfolk VA has been moved up to the first half of 2016.

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Categories: Fiber Networks · Financials · Metro fiber