Bob Currey – Chief Executive Officer
Steve Childers – Chief Financial Officer
Steve Jones – Vice President, Investor Relations
September 2007
1
Safe Harbor
2
Prospectus & Proxy
3
Company Overview
14th largest Independent Local Exchange Carrier in the U.S.
with operations in Illinois and Texas
Approximately 229,000 access lines, 58,000 DSL subscribers and 9,600
IPTV subscribers, representing over 296,000 total connections
Providing voice, video and data services
Triple play offerings in both Texas and Illinois
Announced acquisition of North Pittsburgh Systems, expect to close Q4
2007 or Q1 2008
Year to date 2007 financial overview:
Revenues of $163.9 million
Adjusted EBITDA of $73.3 million
Cash Available to Pay Dividends of $28.0 million, with a dividend
payout ratio of 71.9%
4
Operations in both Texas and Illinois
Illinois
Texas
Balance of both stable rural and growing suburban
markets
5
Marketing, customer service and technology initiatives have been
designed to minimize competitive traction
The company has successfully managed wireless competition since the
late 1980s
Cable operators - Charter and Mediacom in Illinois and Comcast and
Suddenlink in Texas
Only Mediacom has launched a voice product in CNSL’s markets
Managing Competition
CNSL’s strategy is to minimize competition from cable and
wireless companies by providing “sticky” bundled service
offerings and exemplary customer service
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Favorable Regulatory Environment
Rate of return regulated at the federal level in both states
Elected incentive regulation at the state level in Texas and rate of
return in Illinois
Strong working relationships with the FCC and both state
commissions
Actively involved in both USF and access charge reform
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Experienced & Operations-Focused
Management Team
Executive
Title
Telecom
Experience
Bob Currey
President & CEO
37 Years
Steve Childers
Chief Financial Officer
19 Years
Joe Dively
Sr. VP & President of IL
Telephone Ops
20 Years
Steve Shirar
Sr. VP & President of
Enterprise Units
22 Years
Bob Udell
Sr. VP & President of TX
Telephone Ops
19 Years
Chris Young
Chief Information Officer
19 Years
Richard Lumpkin
Chairman
46 Years
CCI Date of
Initial Hire
1990
1986
1991
1996
1993
1985
1963
8
Executing on our Strategy
9
Sustain
and grow
cash flow
Increase
revenue
per customer
Improve
operating
efficiency
Pursue selective
acquisitions
Maintain
effective capital
deployment
9
CNSL continues to focus on increasing revenues per
customer by driving service bundle subscriptions
Attractive product set including:
DSL
IPTV
Integrated voice products
First to offer the triple play in both its Illinois and Texas
markets, with over 90% of video subscribers selecting the
triple play
Bundling not only drives revenue per customer, but also
reduces line loss
Increasing Revenue per Customer with Bundling
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DSL is a Key Component of the Bundle
Attractive, feature rich offering
Multiple speeds and price points
High-margin product
Nearly 100% self-installed
35.4% penetration of
primary residential lines
% of total
access lines
16.2%
18.1%
19.2%
20.9%
22.6%
24.1%
25.4%
11
IPTV Service in Illinois & Texas
A robust offering with over 200 all-digital channels,
premium movie packages and over a 1000 hours of
movies on demand
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Video Drives Incremental Revenue Per Customer
IPTV enables the Triple Play offering
Incremental Product Rollout
Leverages existing resources and network
IP Backbone/ADSL 2+
Future CapEx is success based
Enhances the value of the bundle and deepen customer relationships
IPTV available in both Illinois and Texas
Illinois launched in 2005
Conroe & Katy, Texas launched in August 2006
Lufkin, Texas launched in March 2007
9,577 total video subscribers with 107,631 homes passed as of 6/30/2007
HDTV rolled out in Q2 in Texas and Q3 in Illinois
DVR to be rolled out in Q4 2007
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Stable Customer Base
CNSL’s total connections have grown by over 13,000 since
2005 and product mix has changed
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Increasing Efficiencies & Adjusted EBITDA per
Employee
Adjusted EBITDA per employee is represented by a trend line. See appendix for detail.
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Effective Capital Deployment
Since the beginning of 2003, CNSL has invested over $125 million in
its network, including its core IP backbone and softswitch technology
Installed television headends in Texas and Illinois and is currently
delivering an all digital video signal over its existing fiber/copper
network
92% of total access lines are DSL-capable
Network supports speeds up to 10 megabits per second, as
required by consumer demand
CNSL’s advanced network enables it to offer advanced
products and services, which is a key part of its strategy to
retain customers and increase revenue
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Acquisition Criteria
It will continue to monitor and potentially pursue select acquisition
opportunities based on the following criteria:
Attractiveness of the markets
Quality of the network
The company’s ability to integrate the acquired company efficiently
Potential operating synergies
Cash flow accretive from day one
CNSL has a proven track record of successful business
integrations
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North Pittsburgh Current Operations
North Pittsburgh Systems, Inc.
LTM Revenue ………………………….. $99.8M
ILEC access lines ………… ……………60,663
CLEC access line equivalents ………... 66,699
DSL subscribers ………………...………16,572
Employees ……………………………… 300
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NPSI Transaction Highlights
Expands Consolidated’s footprint
North Pittsburgh provides:
An integrated telecommunications business providing ILEC, edge-out CLEC and
Internet services
An extensive fiber network that extends into Pittsburgh and surrounding
communities
As of June 30, 2007, it served 60,700 ILEC access lines, 66,700 CLEC access
line equivalents and 16,600 DSL subscribers
After completion of this transaction Consolidated will be the 12th largest telephone
company in the United States
Provides an advanced network
99% DSL capable
Enables rollout IPTV in 2008
Opportunity to grow the product suite, increase penetration and improve
customer retention
Improves the dividend payout ratio
Increases operating efficiencies and drives annual cash synergies
Delivers strong cash flow from wireless partnerships
Projected to be cash flow accretive in first full year of operations (post synergies)
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Consolidated’s Strategy for North Pittsburgh Market
Grow Revenue
Launch IPTV in 2008
Aggressively market broadband products and the triple-play bundle
Retain customers
Leverage North Pittsburgh’s new pricing/bundling strategy
Create “stickiness” with existing products and leverage the triple-play offer
Build on North Pittsburgh’s initiatives by implementing the best customer
care and community involvement practices from both companies
Improve operating efficiency
Move to functional organization structure
Integrate the properties utilizing Consolidated’s proven processes
Achieve synergies
Leverage economies of scale
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Synergies
Consolidation
One functional organization across three markets
Leverage Consolidated’s operating capabilities
Leveraging Scale
Software licenses
Maintenance contracts
Purchasing contracts
Reduce third party costs
Legal fees
Audit and SOX fees
Outsourced billing and financial system costs
Public company fees
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CNSL Acquisition Criteria
Attractiveness of the markets
High growth, affluent markets
Edge-out CLEC provides synergy with ILEC
Quality of the network
Well maintained plant
Short loops enable higher broadband speeds and efficient video
overlay
Ability to integrate efficiently
Leverage existing, proven systems and processes
Potential for operating synergies
$7-11 million annually in estimated Op Ex savings
$3-6 million annually in estimated Cap Ex savings
Cash flow accretive
Improves dividend payout ratio
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CNSL Delivering Strong Financial Results…
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Investment Highlights
Attractive Markets
Stable Local
Telephone Business
Bundled
Service Offerings
Favorable
Regulatory
Environment
Technologically
Advanced Network
Experienced
Management Team
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Appendix
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GAAP Reconciliation
This presentation includes disclosures regarding “Adjusted EBITDA”, “cash available to pay dividends” and “total net debt to last 12-
month Adjusted EBITDA ratio” (which we refer to as leverage), all of which are non-GAAP financial measures. Accordingly, they
should not be construed as alternatives to net cash from operating or investing activities, cash flows from operations or net income
(loss) as defined by GAAP and are not, on their own, necessarily indicative of cash available to fund our cash needs as determined in
accordance with GAAP. In addition, not all companies use identical calculations, and these 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, which corresponds to pro forma Bank EBITDA as used and defined in the prospectus dated July 21, 2005 filed in
connection with the IPO, is comprised of historical EBITDA, as adjusted to give effect to the Texas Communications Ventures
Company (TXUCV) acquisition and certain other adjustments permitted and contemplated by our amended and restated credit
facilities.
EBITDA is defined as net earnings (loss) before interest expenses, income taxes, depreciation and amortization on an historical basis.
We believe net cash provided by operating activities is the most directly comparable financial measure to EBITDA under GAAP.
To give pro forma effect to the TXUCV acquisition as if it had occurred on the first day of the periods presented, we have made two
sets of adjustments. First, because the operating results of TXUCV are not reflected in our historical EBITDA and financial results for
the period prior to the date of its acquisition, TXUCV’s historical EBITDA for 2003 and 2004 has been added to our historical EBITDA.
Second, we made pro forma adjustments to the selling, general and administrative expenses to reflect (1) a reduction in costs due to
the termination of certain TXUCV employees upon the closing of the acquisition and (2) incremental professional service fees paid to
certain equity investors pursuant to a new professional services agreement entered into in connection with the TXUCV acquisition.
Finally, when calculating EBITDA in accordance with our credit agreement, the credit agreement permits us to exclude the effect of
certain items. Each of these adjustments is described in the footnotes to the attached reconciliations.
Cash available to pay dividends represents Adjusted EBITDA plus cash interest income, less (1) cash interest expense (after giving
pro forma effect to the IPO as if it had been completed on July 1, 2005), (2) capital expenditures and (3) cash taxes.
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GAAP Reconciliation
We present Adjusted EBITDA and cash available to pay dividends for several reasons. Management believes Adjusted EBITDA and
cash available to pay dividends 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 and cash available to pay dividends 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 and comparability 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 the agreements governing our debt that require 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.
As a result, management believes the presentation of Adjusted EBITDA and cash available to pay dividends as supplemented by these
other items provides important additional information to investors. In addition, Adjusted EBITDA and cash available to pay dividends
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 the agreements governing our debt and to measure our ability
to service and repay debt.
While we use Adjusted EBITDA and cash available to pay dividends in managing and analyzing our business and financial condition
and believe they are useful to our management and investors for the reasons described above, 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 and
the indenture governing our senior notes.
Because Adjusted EBITDA is a component of the ratio of total net debt to last 12-month Adjusted EBITDA, it is subject to the material
limitations discussed above, and 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 that this ratio is useful as a means to evaluate our ability to incur additional indebtedness in the
future and to assist investors, securities analysts and other interested parties in evaluating the companies in our industry.
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Adjusted EBITDA Reconciliation
See footnotes on next page
28
Adjusted EBITDA Reconciliation
29
Cash Available to Pay Dividends
30
Total Net Debt to Adjusted EBITDA Ratio
31
Adjusted EBITDA per Employee - 2004
See footnotes on page 36
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Adjusted EBITDA per Employee - 2005
See footnotes on page 36
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Adjusted EBITDA per Employee - 2006
See footnotes on page 36
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Adjusted EBITDA per Employee - 2007
See footnotes on page 36
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Adjusted EBITDA per Employee
36
Telephone Operations ARPU
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