Lumos Networks has been investing in its fiber network at a rapid pace over the last few years, but we’ve had to wait quite a while to start to really see the effects show up in top line growth. They started to shine through a bit in today’s Q2 results though. Overall revenues moved past analyst expectations to $52.4M, while earnings per share checked in several pennies to the good at $0.05. Here’s a quick table of the company’s Q2 results in some context:
| $ in millions | Q2/15 | Q3/15 | Q4/15 | Q1/16 | Q2/16 |
|---|---|---|---|---|---|
| – Enterprise Data | 11.3 | 11.6 | 11.9 | 12.0 | 12.8 |
| – Transport | 10.0 | 9.5 | 10.0 | 9.1 | 8.9 |
| – FTTC | 6.8 | 7.6 | 7.9 | 8.5 | 9.1 |
| – Residential/SMB | 17.0 | 16.6 | 16.4 | 15.8 | 16.1 |
| – RLEC ACCESS | 5.9 | 5.8 | 5.6 | 5.3 | 5.3 |
| Total Revenue | 51.0 | 51.0 | 51.8 | 50.8 | 52.4 |
| Adjusted EBITDA | 23.8 | 23.1 | 24.6 | 22.2 | 22.7 |
| Adj. EBITDA Margin | 58.4% | 58.3% | 58.7% | 42.7% | 43.3% |
| Capex | 26.1 | 24.8 | 35.6 | 22.0 | 23.2 |
| Buildings on-net | 1,574 | 1,642 | 1,732 | 1,812 | 1,922 |
Revenue growth clearly came from surges in enterprise data and in FTTC, while the company’s regulated businesses benefited from less churn than in previous quarters. Capex levels were again lower as the company finished up its expansion throughout the Richmond and Norfolk metro areas, the extent of which one can see in the map to the left. The focus is now shifting to adding density to that network, and with 110 on-net buildings added during the quarter they have definitely accelerated that pace already.
Lumos also said they’ve made progress in developing plans to separate out the more regulated parts of their business for a sale or spinoff, promising to complete those plans for the next quarterly call.
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Categories: Fiber Networks · Financials
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