Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 16, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 000-09881 | ||
Entity Registrant Name | SHENANDOAH TELECOMMUNICATIONS COMPANY | ||
Entity Incorporation, State or Country Code | VA | ||
Entity Tax Identification Number | 54-1162807 | ||
Entity Address, Address Line One | 500 Shentel Way | ||
Entity Address, City or Town | Edinburg | ||
Entity Address, State or Province | VA | ||
Entity Address, Postal Zip Code | 22824 | ||
City Area Code | 540 | ||
Local Phone Number | 984-4141 | ||
Title of 12(b) Security | Common Stock (No Par Value) | ||
Trading Symbol | SHEN | ||
Security Exchange Name | NASDAQ | ||
Entity Common Stock, Shares Outstanding | 50,204,452 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 0.8 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement relating to its 2023 annual meeting of shareholders (the “2023 Proxy Statement”) are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. The 2023 Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates. | ||
Entity Central Index Key | 0000354963 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | RSM US LLP |
Auditor Location | Fort Lauderdale, Florida |
Auditor Firm ID | 49 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 44,061 | $ 84,344 |
Accounts receivable, net of allowance for doubtful accounts of $776 and $352, respectively | 20,615 | 22,005 |
Income taxes receivable | 29,755 | 30,188 |
Prepaid expenses and other | 11,509 | 29,830 |
Current assets held for sale | 22,622 | 0 |
Total current assets | 128,562 | 166,367 |
Investments | 12,971 | 13,661 |
Property, plant and equipment, net | 687,553 | 554,162 |
Goodwill and intangible assets, net | 81,515 | 89,831 |
Operating lease right-of-use assets | 53,859 | 56,414 |
Deferred charges and other assets | 13,259 | 10,298 |
Total assets | 977,719 | 890,733 |
Current liabilities: | ||
Current maturities of long-term debt, net of unamortized loan fees | 648 | 0 |
Accounts payable | 49,173 | 28,542 |
Advanced billings and customer deposits | 12,425 | 11,128 |
Accrued compensation | 9,616 | 9,653 |
Current operating lease liabilities | 2,829 | 3,318 |
Accrued liabilities and other | 17,906 | 14,649 |
Current liabilities held for sale | 3,824 | 0 |
Total current liabilities | 96,421 | 67,290 |
Long-term debt, less current maturities, net of unamortized loan fees | 74,306 | 0 |
Other long-term liabilities: | ||
Deferred income taxes | 84,600 | 86,014 |
Asset retirement obligations | 9,932 | 9,615 |
Benefit plan obligations | 3,758 | 8,216 |
Non-current operating lease liabilities | 50,477 | 51,692 |
Other liabilities | 20,218 | 25,631 |
Total other long-term liabilities | 168,985 | 181,168 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Common stock, no par value, authorized 96,000; 50,110 and 49,965 issued and outstanding at December 31, 2022 and 2021, respectively | 0 | 0 |
Additional paid in capital | 57,453 | 49,351 |
Retained earnings | 580,554 | 592,924 |
Total shareholders’ equity | 638,007 | 642,275 |
Total liabilities and shareholders’ equity | $ 977,719 | $ 890,733 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 776 | $ 352 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 96,000,000 | 96,000,000 |
Common stock, shares issued (in shares) | 50,110,000 | 49,965,000 |
Common stock, shares outstanding (in shares) | 50,110,000 | 49,965,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue: | |||
Revenue from Contract with Customer, Product and Service [Extensible Enumeration] | Service Revenue And Other [Member] | Service Revenue And Other [Member] | Service Revenue And Other [Member] |
Service revenue and other | $ 267,371 | $ 245,239 | $ 220,775 |
Operating expenses | |||
Cost of services exclusive of depreciation and amortization | 107,546 | 102,299 | 89,657 |
Selling, general and administrative | 92,392 | 82,451 | 85,016 |
Restructuring expense | 1,251 | 1,727 | 0 |
Impairment expense | 5,241 | 5,986 | 0 |
Depreciation and amortization | 68,899 | 55,206 | 48,703 |
Total operating expenses | 275,329 | 247,669 | 223,376 |
Operating loss | (7,958) | (2,430) | (2,601) |
Other (expense) income: | |||
Other (expense) income, net | (1,348) | 8,665 | 3,187 |
(Loss) income from continuing operations before income taxes | (9,306) | 6,235 | 586 |
Income tax benefit | (927) | (1,694) | (990) |
(Loss) income from continuing operations | (8,379) | 7,929 | 1,576 |
Discontinued operations: | |||
Income from discontinued operations, net of tax | 0 | 94,667 | 124,097 |
Gain on the sale of discontinued operations, net of tax | 0 | 896,235 | 0 |
Total income from discontinued operations, net of tax | 0 | 990,902 | 124,097 |
Net (loss) income | (8,379) | 998,831 | 125,673 |
Other comprehensive income (loss): | |||
Unrealized income (loss) on interest rate hedge, net of tax | 0 | 4,706 | (5,014) |
Comprehensive (loss) income | $ (8,379) | $ 1,003,537 | $ 120,659 |
Net (loss) income per share, basic and diluted: | |||
Basic - (Loss) income from continuing operations (in dollars per share) | $ (0.17) | $ 0.16 | $ 0.03 |
Basic - Income from discontinued operations, net of tax (in dollars per share) | 0 | 19.81 | 2.49 |
Basic net (loss) income per share (in dollars per share) | (0.17) | 19.97 | 2.52 |
Diluted - (Loss) income from continuing operations (in dollars per share) | (0.17) | 0.16 | 0.03 |
Diluted - Income from discontinued operations, net of tax (in dollars per share) | 0 | 19.76 | 2.48 |
Diluted net (loss) income per share (in dollars per share) | $ (0.17) | $ 19.92 | $ 2.51 |
Weighted average shares outstanding, basic (in shares) | 50,155 | 50,026 | 49,901 |
Weighted average shares outstanding, diluted (in shares) | 50,155 | 50,149 | 50,024 |
Cash dividends declared per share (in dollars per share) | $ 0.08 | $ 18.82 | $ 0.34 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Shares of Common Stock (no par value) | Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2019 | 49,671,000 | ||||
Beginning balance at Dec. 31, 2019 | $ 468,135 | $ 42,110 | $ 425,717 | $ 308 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | 125,673 | 125,673 | |||
Net loss on interest rate swaps, net of tax | (5,014) | (5,014) | |||
Dividends declared | (16,950) | (16,950) | |||
Dividends reinvested in common stock | (2) | (2) | |||
Stock based compensation (in shares) | 156,000 | ||||
Stock-based compensation | 6,833 | 6,833 | |||
Stock options exercised | 36 | 36 | |||
Common stock issued (in shares) | 1,000 | ||||
Common stock issued | 31 | 31 | |||
Annual dividend reinvestment (in shares) | 12,000 | ||||
Annual dividend reinvestment | 526 | 526 | |||
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards (in shares) | (48,000) | ||||
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards | (2,217) | (2,217) | |||
Common stock issued to acquire a non-controlling interests of nTelos (in shares) | 76,000 | ||||
Ending balance (in shares) at Dec. 31, 2020 | 49,868,000 | ||||
Ending balance at Dec. 31, 2020 | 577,051 | 47,317 | 534,440 | (4,706) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | 998,831 | 998,831 | |||
Net loss on interest rate swaps, net of tax | 4,706 | 4,706 | |||
Dividends declared | (940,347) | (940,347) | |||
Stock based compensation (in shares) | 133,000 | ||||
Stock-based compensation | 3,661 | 3,661 | |||
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards (in shares) | (36,000) | ||||
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards | $ (1,627) | (1,627) | |||
Ending balance (in shares) at Dec. 31, 2021 | 49,965,000 | 49,965,000 | |||
Ending balance at Dec. 31, 2021 | $ 642,275 | 49,351 | 592,924 | 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net (loss) income | (8,379) | (8,379) | |||
Dividends declared | (3,991) | (3,991) | |||
Stock based compensation (in shares) | 194,000 | ||||
Stock-based compensation | 9,178 | 9,178 | |||
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards (in shares) | (49,000) | ||||
Shares surrendered for settlement of employee taxes upon issuance of vested equity awards | $ (1,076) | (1,076) | |||
Ending balance (in shares) at Dec. 31, 2022 | 50,110,000 | 50,110,000 | |||
Ending balance at Dec. 31, 2022 | $ 638,007 | $ 57,453 | $ 580,554 | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net (loss) income | $ (8,379) | $ 998,831 | $ 125,673 |
Income from discontinued operations, net of tax | 0 | 990,902 | 124,097 |
(Loss) income from continuing operations | (8,379) | 7,929 | 1,576 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 68,175 | 54,389 | 47,964 |
Amortization | 724 | 817 | 739 |
Accretion of asset retirement obligations | 531 | 421 | 333 |
Bad debt expense | 1,972 | 1,028 | 1,220 |
Stock-based compensation expense, net of amount capitalized | 8,528 | 3,408 | 5,907 |
Deferred income taxes | (1,414) | 22,263 | 14,906 |
Restructuring expense | 1,251 | 1,727 | 0 |
Impairment expense | 5,241 | 5,986 | 0 |
Other, net | (824) | 481 | (1,311) |
Changes in assets and liabilities: | |||
Accounts receivable | (583) | 163 | (7,318) |
Current income taxes | 434 | (25,149) | (15,896) |
Operating lease right-of-use assets | 6,322 | 4,779 | 3,980 |
Other assets | (451) | (7,005) | (2,505) |
Accounts payable | 19 | 2,976 | (663) |
Lease liabilities | (5,471) | (4,333) | (3,067) |
Other deferrals and accruals | (1,180) | (6,427) | 7,494 |
Net cash provided by operating activities - continuing operations | 74,895 | 63,453 | 53,359 |
Net cash (used in) provided by operating activities - discontinued operations | 0 | (314,387) | 249,508 |
Net cash provided by (used in) operating activities | 74,895 | (250,934) | 302,867 |
Cash flows from investing activities: | |||
Capital expenditures | (189,609) | (160,101) | (120,450) |
Cash disbursed for acquisitions | 0 | 0 | (1,890) |
Refund received (cash disbursed) for deposit on FCC spectrum leases | 3,996 | 0 | (16,118) |
Proceeds from sale of assets and other | 1,434 | 366 | 370 |
Net cash used in investing activities - continuing operations | (184,179) | (159,735) | (138,088) |
Net cash provided by (used in) investing activities - discontinued operations | 0 | 1,944,089 | (17,500) |
Net cash (used in) provided by investing activities | (184,179) | 1,784,354 | (155,588) |
Cash flows from financing activities: | |||
Proceeds from term loan borrowings | 75,000 | 0 | 0 |
Payments for debt issuance costs | 0 | (841) | 0 |
Dividends paid, net of dividends reinvested | (3,991) | (940,256) | (16,424) |
Taxes paid for equity award issuances | (1,076) | (1,627) | (2,217) |
Payments for financing arrangements and other | (932) | (1,193) | (769) |
Net cash provided by (used in) financing activities - continuing operations | 69,001 | (943,917) | (19,410) |
Net cash used in financing activities - discontinued operations | 0 | (700,556) | (34,123) |
Net cash provided by (used in) financing activities | 69,001 | (1,644,473) | (53,533) |
Net (decrease) increase in cash and cash equivalents | (40,283) | (111,053) | 93,746 |
Cash and cash equivalents, beginning of period | 84,344 | 195,397 | 101,651 |
Cash and cash equivalents, end of period | $ 44,061 | $ 84,344 | $ 195,397 |
Nature of Operations
Nature of Operations | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations Shenandoah Telecommunications Company and its subsidiaries (collectively, “Shentel”, “we”, “our”, “us”, or the “Company”) provide broadband data, video and voice services to residential and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania and Kentucky, via fiber optic and hybrid fiber coaxial cable networks. We also lease dark fiber and provide Ethernet and Wavelength fiber optic services to enterprise and wholesale customers throughout the entirety of our service area. The Broadband segment also provides voice and DSL telephone services to customers in Virginia’s Shenandoah County and portions of adjacent counties as a Rural Local Exchange Carrier (“RLEC”). These integrated networks are connected by a fiber network. All of these operations are contained within our Broadband reporting segment. Our Tower segment owns 222 cell towers and leases colocation space on those towers to wireless communications providers, refer to Note 14, Segment Reporting , for additional information. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Principles of consolidation: The accompanying consolidated financial statements include the accounts of Shenandoah Telecommunications Company and all of its wholly owned subsidiaries. All intercompany accounts and transactions for continuing operations have been eliminated in consolidation. Use of estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States, requires us to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses and related disclosures. Due to the inherent uncertainty involved in making estimates, actual results to be reported in future periods could differ from our estimates. Revenue recognition: The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from contracts with customers, (“ASC 606”). Our Broadband segment provides broadband data, video and voice services to residential, small and midsize businesses (“SMB”) and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania and Kentucky, via fiber optic and hybrid fiber coaxial cable networks. The Broadband segment also provides voice and DSL telephone services to customers in Virginia’s Shenandoah County and portions of adjacent counties as an RLEC. These contracts are generally cancellable at the customer’s discretion without penalty at any time. Transaction price is measured as the amount billed, which is generally determined by list prices for goods and services less discounts offered. We allocate the total transaction price in these transactions based upon the standalone selling price of each distinct good or service. We generally recognize these revenues over time as customers simultaneously receive and consume the benefits of the service, with the exception of equipment sales and home wiring, which are recognized as revenue at a point in time when control transfers and when installation is complete, respectively. A significant portion of the Company’s revenues are derived from customers who may cancel their subscriptions at any time without penalty. As such, the amount of deferred revenue related to unsatisfied performance obligations is not necessarily indicative of the future revenue to be recognized from the Company’s existing customers. Installation fees charged upfront without transfer of commensurate goods or services to the customer are allocated to services and are recognized ratably over the longer of the contract term or the period in which the unrecognized fee remains material to the contract, which we estimate to be one year. Additionally, the Company incurs commission expenses related to in-house and third-party vendors which are capitalized and amortized over the expected customer benefit period. Our Broadband segment also provides Ethernet and Wavelength fiber optic services to commercial fiber customers under capacity agreements, and the related revenue is recognized over time. In some cases, non-refundable upfront fees are charged for connecting commercial fiber customers to our fiber network. Those amounts are recognized ratably over the initial contract term. The Broadband segment also leases dedicated fiber optic strands to customers as part of “dark fiber” agreements, which are accounted for as leases under ASC 842, Leases (“ASC 842”). Our Tower segment leases space on owned cell towers to our Broadband segment, and to other wireless carriers. Revenue from these leases is accounted for under ASC 842. Advertising Costs: The Company expenses advertising costs and marketing production costs as incurred and includes such costs within selling, general and administrative expenses in the consolidated statements of operations. Advertising expense for the years ended December 31, 2022, 2021 and 2020 was $6.8 million, $4.4 million and $2.7 million, respectively. Fair value measurements: The Company measures certain assets and liabilities at fair value. Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company uses the fair value hierarchy to evaluate inputs used in determining the fair value of its assets and liabilities. The three levels of inputs used to measure fair value are (i) observable inputs, such as quoted prices in active markets (level 1); (ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (level 2); and (iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (level 3). The Company remeasures long-lived assets such as property, plant and equipment, intangible assets and goodwill at fair value when they are deemed to be impaired. The fair value of these assets is determined with valuation techniques using the best information available and may include quoted market prices, market comparables or discounted cash flow models. The carrying amounts reported in the Company’s consolidated financial statements for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of the short-term nature of these financial instruments. The carrying amount of the Company's debt balance from term loans, which have a floating interest rate, approximate fair value. Cash and cash equivalents: Cash equivalents include all investments with an original maturity of three months or less. The Company places its temporary cash investments with high credit quality financial institutions. Generally, such investments are in excess of FDIC or SIPC insurance limits. Allowance for doubtful accounts: Accounts receivable have been reduced by an allowance for amounts that may be uncollectible in the future. This estimated allowance is based primarily on the aging category, historical collection experience and management’s evaluation of the financial condition of the customer. The Company writes off accounts receivable balances deemed uncollectible against the allowance for credit losses generally when the account is turned over for collection to an outside collection agency. Investments: The Company investments measured at fair value primarily consist of Supplemental executive retirement plan (“SERP”) investments in a rabbi trust as a source of funding for future payments under the plan. The SERP’s investments were designated as trading securities and will be liquidated and paid out to the participants six months after retirement. The benefit obligation to participants is always equal to the value of the SERP assets under ASC 710, Compensation . The Company's investments measured at cost primarily consist of CoBank’s Class A common stock derived from the CoBank patronage program. The investment is recognized as the Company’s initial investment in CoBank plus subsequent patronage distributions received from CoBank. Property, plant and equipment: Property, plant and equipment is stated at cost less accumulated depreciation and amortization. The Company capitalizes all costs associated with the purchase, deployment and installation of property, plant and equipment, including interest costs and internal labor costs on major capital projects during the period of their construction. Maintenance expense is recognized as incurred when repairs are performed that do not extend the life of property, plant and equipment. Expenses for major renewals and improvements, which significantly extend the useful lives of existing property and equipment, are capitalized and depreciated. Depreciation is calculated on the straight-line method over the estimated useful lives of the assets. Labor costs associated with customer installation activities at existing service locations are expensed as incurred under industry specific guidance. Leasehold improvements are amortized over the lesser of their useful lives or respective lease terms. Land is not depreciated. Refer to Note 5, Property, Plant and Equipment , for additional information. Indefinite-lived intangible assets: Goodwill represents the excess of acquisition costs over the fair value of tangible net assets and identifiable intangible assets of the businesses acquired. Cable franchise rights provide us with the non-exclusive right to provide video services in a specified area. Spectrum licenses are issued by the Federal Communications Commission (“FCC”) and provide us with either an exclusive or priority access right to utilize designated radio frequency spectrum within specific geographic service areas to provide wireless communication services. While some cable franchises and spectrum licenses are issued for a fixed time (generally ten years and up to fifteen years, respectively), renewals have been granted routinely and at nominal costs. The Company believes it will be able to meet all requirements necessary to secure renewal of its cable franchise rights and spectrum licenses. Moreover, the Company has determined that there are currently no legal, regulatory, contractual, competitive, economic or other factors that limit the useful lives of our cable franchises or spectrum licenses and as a result, we account for cable franchise rights and spectrum licenses as indefinite-lived intangible assets. Indefinite-lived intangible assets are not amortized, but rather, are subject to impairment testing annually, in the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. Goodwill is evaluated for impairment based on the identification of reporting units. Our reporting units align with our reportable segments. We evaluated our reporting units for impairment on October 1, 2022 on the basis of qualitative factors. Our consideration of qualitative factors included but was not limited to macroeconomic conditions, industry and market conditions, company specific events, changes in circumstances, after tax cash flows and market capitalization trends. We concluded that there were no indicators that a reporting unit impairment was more likely than not. We evaluated our cable franchise rights for impairment on October 1, 2022 utilizing a quantitative assessment. Our quantitative assessment compared an estimated fair value of the cable franchise rights to their book value. To estimate fair value we used a greenfield model, a method under the income approach, which reflected the expected discounted cash flows of a notional start-up business with no assets other than the cable franchise rights being valued. The primary assumptions utilized in the analysis include assumptions regarding revenue growth, the amount and timing of capital expenditures, EBITDA margins and the discount rate utilized. We concluded that no impairment existed. Long-lived assets: Finite-lived intangible assets, property, plant, and equipment, and other long-lived assets held for use are amortized or depreciated over their estimated useful lives, as summarized in the respective notes below. These assets are evaluated for impairment based on the identification of asset groups. Our asset groups align with our reportable segments. We evaluated our asset groups for impairment during the fourth quarter of 2022 and concluded that there were no indicators that an asset group impairment was more likely than not, with the exception of those described in Note 5, Property, Plant and Equipment. Asset retirement obligations: Certain of the Company’s lease agreements contain provisions requiring the Company to restore facilities or remove property in the event that the lease agreement is not renewed. The Company records an estimate for the cost to comply with these provisions based on what a willing third party would charge for the retirement activity on the date of recognizing the asset retirement obligation. Upon retirement of the related asset and performance of the asset retirement activities, the Company derecognizes the asset retirement obligation and records a gain or loss to reflect the difference between the Company's estimate and the actual cost to retire the asset. Benefit plan obligations: The Benefit Plan Obligations caption includes the following: ($ in thousands) December 31, 2022 December 31, 2021 Pension plan $ — $ 2,393 Postretirement medical benefits plan 1,869 3,506 Supplemental executive retirement plan 1,889 2,317 Total $ 3,758 $ 8,216 The pension plan is a frozen defined benefit plan. Benefits under the plan vested after five years of plan service and were based on years of service and an average of the five highest consecutive years of compensation subject to certain reductions if the employee elects to receive the benefit prior to age 65. This plan was amended on December 31, 2012, to freeze future benefit plan accruals for participants. As of December 31, 2022 and 2021, the fair value of our pension plan assets were $21.3 million and $31.1 million, respectively. These investments are held in mutual funds, and are valued based on the net asset value per share. Our Pension Plan's projected benefit obligation was $24.7 million and $33.5 million, at December 31, 2022 and 2021, respectively. The Pension Plan liability was discounted at 4.90% and 2.74% at December 31, 2022 and 2021, respectively. On October 13, 2021, the Company adopted a resolution to terminate its pension plan. The expected termination will result in a payout of all existing obligations either through lump sum payments or through the purchase of annuity contracts at the option of the pension plan's participants. The Company expects the pension plan termination to be completed by December 31, 2023. Consequently, the net benefit plan obligation for the pension plan, with a balance of approximately $3.4 million, is presented in accrued liabilities and other in the Company's consolidated balance sheet at December 31, 2022. The postretirement medical benefits plan is a frozen, unfunded, defined benefit plan. The postretirement plan liability was discounted at 5.00% and 2.70% at December 31, 2022 and 2021, respectively. The SERP is a benefit plan that provides deferred compensation to certain employees. The Company holds investments in a rabbi trust as a source of funding for future payments under the plan. The SERP’s investments were designated as trading securities and will be liquidated and paid out to the participants upon retirement. The benefit obligation to participants is always equal to the value of the SERP assets under ASC 710 Compensation. Changes to the investments’ fair value are presented in Other income, net, while the reciprocal changes in the liability representative of compensatory expense, are presented in selling, general and administrative expense in the Company's consolidated statement of comprehensive (loss) income. Leases: The Company leases various telecommunications sites, warehouses, retail stores, and office facilities for use in our business. These agreements include fixed rental payments as well as variable rental payments such as those based on relevant inflation indices. The accounting lease term includes optional renewal periods that we are reasonably certain to exercise based on our assessment of relevant contractual and economic factors. The related lease payments are discounted at lease commencement using the Company's incremental borrowing rate in order to measure the lease liability and right-of-use asset. The incremental borrowing rate is determined using a portfolio approach based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Company uses the observable unsecured borrowing rate and risk-adjusts that rate to approximate a collateralized rate. Income taxes: The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. In assessing the ability to realize deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon generating future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income, taxable income in prior carryback years if available and tax planning strategies in making this assessment. Based upon the level of historical taxable income, projections for future taxable income over the periods for which the deferred tax assets are deductible, and the option to elect out of bonus depreciation on in-serviced fixed assets, the Company believes it more likely than not that the net deferred tax assets will be realized. The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. The Company records a liability for the difference between the benefit recognized and measured for financial statement purposes and the tax position taken or expected to be taken on the tax return. Changes in the estimate are recorded in the period in which such determination is made. Stock-based compensation: The cost of employee services received in exchange for share-based awards classified as equity is measured using the estimated fair value of the award on the date of the grant, and the related expense is recorded using the straight-line method consistent with the recipient's respective service period. The fair value for the Company's restricted stock units (“RSUs”) are determined using the Company's stock price and the fair value for the Company's Relative Total Shareholder Return (“RTSR”) awards are determined using a Monte Carlo simulation. The Company records forfeitures for its RSUs and RTSRs as they occur. Certain of the Company's share-based awards contain retirement clauses which state that awards will continue to vest without the requirement of continuous employment after a participant achieves certain service- and age-based requirements (“Retirement Eligibility”). The Company accelerates expense associated with eligible awards for employees who have achieved Retirement Eligibility on the later of the grant date or the date in which Retirement Eligibility is achieved. Segments: The Company’s chief operating decision maker (“CODM”) regularly reviews the Company’s results to assess performance and allocates resources at the level of the Company's two operating segments, Broadband and Tower. Given the differences in the characteristics of the Company's operating segments, management has determined that the operating segments cannot be combined into one reportable segment. As such, the Company has two reportable segments, Broadband and Tower. New Accounting Standards In November 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2021-10, “ Government Assistance (Topic 832), Disclosures by Business Entities About Government Assistance, ” (“ASU 2021-10”) which requires entities to provide disclosures on material government assistance transactions for annual reporting periods. The disclosures include information about the nature of the assistance, the related accounting policies used to account for government assistance, the effect of government assistance on the entity’s financial statements and any significant terms and conditions of the agreements, including commitments and contingencies. We adopted ASU 2021-10 in 2022 and have included the new disclosure requirements in Note 12, Government Grants . |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Our Broadband segment provides broadband data, video and voice services to residential, SMB and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania and Kentucky, via fiber optic and hybrid fiber coaxial cable networks. The Broadband segment also provides voice and DSL telephone services to customers in Virginia’s Shenandoah County and portions of adjacent counties as an RLEC. Contract Assets The Company’s contract assets primarily include commissions incurred to acquire contracts with customers. The Company incurs commission expenses related to in-house and third-party vendors which are capitalized and amortized over the expected customer benefit period which is approximately six years. Amortization of capitalized commission expenses is recorded in selling, general and administrative expenses in the Company's consolidated statements of comprehensive (loss) income. The following tables present the activity of current and non-current contract assets: (in thousands) 2022 2021 Beginning Balance $ 8,147 $ 7,358 Commission payments 3,355 3,229 Contract asset amortization (2,856) (2,440) Ending Balance $ 8,646 $ 8,147 Contract Liabilities The Company’s contract liabilities include services that are billed in advance and recorded as deferred revenue, as well as installation fees that are changed upfront without transfer of commensurate goods or services to the customer. The Company’s current contract liabilities are included in advanced billings and customer deposits in its consolidated balance sheets and the Company’s non-current contract liabilities are included in other liabilities in its consolidated balance sheets. The current contract liabilities at December 31, 2021 were recognized within revenues in the Company’s consolidated statement of comprehensive (loss) income during 2022. Shentel anticipates the current contract liability balance of $9.5 million as of December 31, 2022 to be recognized within revenues in the next twelve months and the non-current contract liability balance of $1.9 million to be recognized within revenues after twelve months. No customers accounted for more than 10% of revenue for the years ended December 31, 2022, 2021, and 2020 and no customer made up more than 10% of accounts receivable at December 31, 2022 and 2021. Refer to Note 14, Segment Reporting , for a summary of the Company's revenue streams. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2022 | |
Investments [Abstract] | |
Investments | Investments Investments consist of the following: (in thousands) December 31, December 31, SERP investments at fair value $ 1,889 $ 2,317 Cost method investments 10,749 11,004 Equity method investments 333 340 Total investments $ 12,971 $ 13,661 SERP investments at fair value: The fair value of the SERP investments are based on unadjusted quoted prices in active markets and are classified as Level 1 of the fair value hierarchy. Changes to the investments' fair value are presented in Other income (expense), while the reciprocal changes in the liability are presented in selling, general and administrative expense. At December 31, 2021, $0.8 million of SERP investments were presented as prepaid expenses and other (current assets). Those investments were liquidated in July 2022 to pay the current portion of our SERP obligation. Cost method investments : Our investment in CoBank’s Class A common stock, derived from the CoBank patronage program, represented substantially all of our cost method investments with a balance of $10.0 million and $10.3 million at December 31, 2022 and 2021, respectively. We recognized approximately $70.7 thousand, $2.0 million and $4.2 million of patronage income in other income (expense) in 2022, 2021 and 2020, respectively. Historically, approximately 75% of the patronage distributions were collected in cash and 25% in equity. Equity method investments: At December 31, 2022, the Company had a 20.0% ownership interest in Valley Network Partnership (“ValleyNet”). The Company and ValleyNet purchase capacity on one another’s fiber network through related party transactions. We recognized revenue of $0.7 million, $0.7 million, and $0.9 million from providing service to ValleyNet during 2022, 2021, and 2020, respectively. We recognized cost of service of $0.1 million, $1.2 million, and $2.7 million for the use of ValleyNet’s network during 2022, 2021, and 2020, respectively. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consist of the following: (in thousands) Estimated Useful Lives December 31, December 31, Land $ 3,722 $ 3,771 Land improvements 10 years 3,483 3,478 Buildings and structures 10 - 45 years 93,461 96,323 Cable and fiber 15 - 30 years 593,771 453,405 Equipment and software 4 - 8 years 317,347 391,293 Plant in service 1,011,784 948,270 Plant under construction 144,534 79,963 Total property, plant and equipment 1,156,318 1,028,233 Less: accumulated depreciation and amortization (468,765) (474,071) Property, plant and equipment, net $ 687,553 $ 554,162 Property, plant and equipment, net increased due primarily to capital expenditures in the Broadband segment driven by our Glo Fiber market expansion. The Company's accounts payable as of December 31, 2022 included amounts associated with capital expenditures of approximately $43.8 million. Cash flows for accounts payable and capital expenditures exclude this activity. Depreciation and amortization expense was $68.2 million, $54.4 million, and $48.0 million for the years ended December 31, 2022, 2021, and 2020, respectively. In 2022, the Company improved internal controls over property, plant, and equipment. The enhanced controls identified fully depreciated assets no longer held by the Company. Accordingly, the Company made adjustments to reduce the cost of buildings and structures, cable and fiber, and equipment and software by $0.3 million, $0.1 million, and $62.9 million, respectively, with an offset to accumulated depreciation at December 31, 2022. In the fourth quarter of 2021, due to the availability of grants awarded under various governmental initiatives in support of rural fiber to the home (“FTTH”) broadband network expansion projects, we decided to cease further expansion of our Beam branded fixed wireless edge-out strategy, which is offered under our Broadband segment. During the second quarter of 2022, the Company permanently ceased operating 20 of our 55 Beam fixed wireless sites. Consequently, Shentel recorded an impairment charge of $4.1 million. On August 23, 2022, the Company entered into a definitive asset purchase agreement (the “Spectrum Purchase Agreement”) with a wireless carrier pursuant to which the Company agreed to sell certain FCC spectrum licenses and leases utilized in the Company's Beam branded fixed wireless service for total consideration of approximately $21.5 million, composed of $17.7 million cash and approximately $3.8 million of liabilities to be assumed by the wireless carrier (the “Spectrum Transaction”). The Spectrum Transaction is expected to close in the first half of 2023, subject to the receipt of regulatory approvals and other customary closing conditions. As a result of the Spectrum Transaction, the Company ceased its remaining Beam operations in the fourth quarter of 2022 and accelerated depreciation for remaining Beam network assets. Shentel recorded $7.4 million in accelerated depreciation for the year ended December 31, 2022. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The Company’s goodwill and intangible assets consist of the following: December 31, 2022 December 31, 2021 (in thousands) Gross Accumulated Amortization and Other Net Gross Accumulated Amortization and Other Net Goodwill - Broadband $ 3,244 $ — $ 3,244 $ 3,244 $ — $ 3,244 Indefinite-lived intangibles: Cable franchise rights $ 64,334 $ — $ 64,334 $ 64,334 $ — $ 64,334 FCC spectrum licenses 12,122 — 12,122 13,839 — 13,839 Railroad crossing rights 141 — 141 141 — 141 Total indefinite-lived intangibles 76,597 — 76,597 78,314 — 78,314 Finite-lived intangibles: FCC spectrum licenses — — — 6,811 (672) 6,139 Subscriber relationships 28,425 (26,910) 1,515 28,425 (26,451) 1,974 Other intangibles 488 (329) 159 463 (303) 160 Total finite-lived intangibles 28,913 (27,239) 1,674 35,699 (27,426) 8,273 Total goodwill and intangible assets $ 108,754 $ (27,239) $ 81,515 $ 117,257 $ (27,426) $ 89,831 Amortization expense was $0.7 million, $0.8 million and $0.7 million for the years ended December 31, 2022, 2021 and 2020, respectively. During the third quarter of 2020, the Company was awarded certain indefinite-lived Citizens Broadband Radio Service (“CBRS”) spectrum licenses to be used within the Broadband segment. The Company paid an aggregate deposit of $16.1 million with respect to the licenses subject to final approval and issuance by the FCC. The licenses will provide us priority access rights over general access users other than incumbents, in that specific band, in accordance with the FCC’s three-tier CBRS band spectrum sharing framework. The FCC approved the Company’s final application for the licenses in the third quarter of 2022, resulting in the issuance of the licenses with a deposit value of $12.1 million. The Company recorded these licenses as indefinite-lived intangible assets. These licenses are not subject to the Spectrum Transaction described above. The remaining $4.0 million of the deposit was returned to the Company in the form of a cash refund in the fourth quarter of 2022. As described in Note 5, Property, Plant and Equipment , the Company entered into the Spectrum Purchase Agreement to sell FCC spectrum licenses associated with Beam. As a result of the expected sale, the Company concluded that the FCC spectrum licenses met the held-for-sale criteria; accordingly, $13.8 million of indefinite-lived licenses and $5.9 million of finite-lived licenses are presented as held for sale, along with the corresponding $3.8 million of operating lease liabilities related to the finite-lived licenses. The Company evaluated the events described here and in Note 5, Property, Plant and Equipment and determined that these events do not represent a strategic shift in the Company’s business. Our finite-lived intangible assets are amortized over the following estimated useful lives: Estimated Useful Life Subscriber relationships 3 - 10 years Other intangibles 15 - 20 years The following table summarizes expected amortization of intangible assets at December 31, 2022: (in thousands) Amortization of Intangible Assets 2023 $ 489 2024 489 2025 483 2026 103 2027 65 Thereafter 45 Total $ 1,674 |
Other Assets and Accrued Liabil
Other Assets and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Other Assets and Accrued Liabilities | Other Assets and Accrued Liabilities Prepaid expenses and other, classified as current assets, included the following: (in thousands) December 31, December 31, Deposit for FCC spectrum licenses $ — $ 16,118 Prepaid maintenance expenses 7,444 8,391 Broadband contract acquisition costs 2,809 2,502 SERP investments — 801 Other 1,256 2,018 Prepaid expenses and other $ 11,509 $ 29,830 Deferred charges and other assets, classified as long-term assets, included the following: (in thousands) December 31, December 31, Broadband contract acquisition costs $ 5,837 $ 5,645 Prepaid expenses and other 7,422 4,653 Deferred charges and other assets $ 13,259 $ 10,298 Accrued liabilities and other, classified as current liabilities, included the following: (in thousands) December 31, December 31, Accrued programming costs 3,306 $ 3,084 Pension plan 3,341 — Restructuring accrual 146 1,761 Other current liabilities 11,113 9,804 Accrued liabilities and other $ 17,906 $ 14,649 Other liabilities, classified as long-term liabilities, included the following: (in thousands) December 31, December 31, Noncurrent portion of deferred revenue $ 18,679 $ 19,749 Noncurrent portion of financing leases 1,500 1,614 FCC spectrum license obligations — 3,807 Other 39 461 Other liabilities $ 20,218 $ 25,631 Restructuring activities During 2021, as a result of the sale of our Wireless assets and operations, we implemented a restructuring plan whereby certain employees were notified of their pending dismissal under the workforce reduction program. We made $1.7 million and $2.1 million in severance payments for the years ended December 31, 2022 and 2021, respectively. For the year ended December 31, 2021, we recognized expenses of $1.7 million and $2.2 million, presented in continuing and discontinued operations, respectively. Asset Retirement Obligations: Our asset retirement obligations (“ARO”) arise from certain of our leases and generally require us to remove our towers from ground leases. Current ARO liabilities are recorded in accrued liabilities and other in the Company’s consolidated balance sheets. Below is a summary of our current and non-current asset retirement obligations: Years Ended December 31, (in thousands) 2022 2021 2020 Balance at beginning of year $ 9,824 $ 5,113 $ 6,152 Additional asset retirement obligations recorded and changes to prior estimates 1,198 4,290 (1,371) Liabilities settled (185) — — Accretion expense 531 421 332 Balance at end of year $ 11,368 $ 9,824 $ 5,113 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases At December 31, 2022, our operating leases had a weighted average remaining lease term of twenty years and a weighted average discount rate of 4.5%. Our finance leases had a weighted average remaining lease term of thirteen years and a weighted average discount rate of 5.2%. We recognized $7.6 million, $7.1 million and $6.6 million of operating lease expense for the years ended December 31, 2022, 2021 and 2020, respectively. We recognized $0.6 million of interest and depreciation expense on finance leases for each of the years ended December 31, 2022, 2021 and 2020. Operating lease expense is presented in cost of service or selling, general and administrative expense based on the use of the relevant facility. Variable lease payments and short-term lease expense were both immaterial. We remitted $6.1 million, $5.6 million, and $4.4 million of operating lease payments during the years ended December 31, 2022, 2021 and 2020, respectively. We also obtained $2.5 million, $11.1 million and $6.8 million of leased assets in exchange for new operating lease liabilities, including new and modified agreements, recognized during the years ended December 31, 2022, 2021 and 2020, respectively. The following table summarizes the expected maturity of lease liabilities at December 31, 2022: (in thousands) Operating Leases Finance Leases Total 2023 $ 4,987 $ 176 $ 5,163 2024 5,102 178 5,280 2025 4,897 180 5,077 2026 4,405 153 4,558 2027 3,634 155 3,789 2028 and thereafter 64,443 1,359 65,802 Total lease payments 87,468 2,201 89,669 Less: interest (34,162) (604) (34,766) Present value of lease liabilities $ 53,306 $ 1,597 $ 54,903 We recognized $18.4 million, $11.1 million, and $9.1 million of operating lease revenue for the years ended December 31, 2022, 2021 and 2020, respectively, related to the cell site colocation space and dedicated fiber optic strands that we lease to our customers, which is included in service revenue and other in the consolidated statements of comprehensive (loss) income. Substantially all of our lease revenue relates to fixed lease payments. Below is a summary of our contractual minimum rental receipts expected under the lease agreements in place at December 31, 2022: (in thousands) Operating Leases 2023 $ 15,100 2024 13,710 2025 12,791 2026 9,754 2027 8,258 2028 and thereafter 21,572 Total $ 81,185 |
Leases | Leases At December 31, 2022, our operating leases had a weighted average remaining lease term of twenty years and a weighted average discount rate of 4.5%. Our finance leases had a weighted average remaining lease term of thirteen years and a weighted average discount rate of 5.2%. We recognized $7.6 million, $7.1 million and $6.6 million of operating lease expense for the years ended December 31, 2022, 2021 and 2020, respectively. We recognized $0.6 million of interest and depreciation expense on finance leases for each of the years ended December 31, 2022, 2021 and 2020. Operating lease expense is presented in cost of service or selling, general and administrative expense based on the use of the relevant facility. Variable lease payments and short-term lease expense were both immaterial. We remitted $6.1 million, $5.6 million, and $4.4 million of operating lease payments during the years ended December 31, 2022, 2021 and 2020, respectively. We also obtained $2.5 million, $11.1 million and $6.8 million of leased assets in exchange for new operating lease liabilities, including new and modified agreements, recognized during the years ended December 31, 2022, 2021 and 2020, respectively. The following table summarizes the expected maturity of lease liabilities at December 31, 2022: (in thousands) Operating Leases Finance Leases Total 2023 $ 4,987 $ 176 $ 5,163 2024 5,102 178 5,280 2025 4,897 180 5,077 2026 4,405 153 4,558 2027 3,634 155 3,789 2028 and thereafter 64,443 1,359 65,802 Total lease payments 87,468 2,201 89,669 Less: interest (34,162) (604) (34,766) Present value of lease liabilities $ 53,306 $ 1,597 $ 54,903 We recognized $18.4 million, $11.1 million, and $9.1 million of operating lease revenue for the years ended December 31, 2022, 2021 and 2020, respectively, related to the cell site colocation space and dedicated fiber optic strands that we lease to our customers, which is included in service revenue and other in the consolidated statements of comprehensive (loss) income. Substantially all of our lease revenue relates to fixed lease payments. Below is a summary of our contractual minimum rental receipts expected under the lease agreements in place at December 31, 2022: (in thousands) Operating Leases 2023 $ 15,100 2024 13,710 2025 12,791 2026 9,754 2027 8,258 2028 and thereafter 21,572 Total $ 81,185 |
Leases | Leases At December 31, 2022, our operating leases had a weighted average remaining lease term of twenty years and a weighted average discount rate of 4.5%. Our finance leases had a weighted average remaining lease term of thirteen years and a weighted average discount rate of 5.2%. We recognized $7.6 million, $7.1 million and $6.6 million of operating lease expense for the years ended December 31, 2022, 2021 and 2020, respectively. We recognized $0.6 million of interest and depreciation expense on finance leases for each of the years ended December 31, 2022, 2021 and 2020. Operating lease expense is presented in cost of service or selling, general and administrative expense based on the use of the relevant facility. Variable lease payments and short-term lease expense were both immaterial. We remitted $6.1 million, $5.6 million, and $4.4 million of operating lease payments during the years ended December 31, 2022, 2021 and 2020, respectively. We also obtained $2.5 million, $11.1 million and $6.8 million of leased assets in exchange for new operating lease liabilities, including new and modified agreements, recognized during the years ended December 31, 2022, 2021 and 2020, respectively. The following table summarizes the expected maturity of lease liabilities at December 31, 2022: (in thousands) Operating Leases Finance Leases Total 2023 $ 4,987 $ 176 $ 5,163 2024 5,102 178 5,280 2025 4,897 180 5,077 2026 4,405 153 4,558 2027 3,634 155 3,789 2028 and thereafter 64,443 1,359 65,802 Total lease payments 87,468 2,201 89,669 Less: interest (34,162) (604) (34,766) Present value of lease liabilities $ 53,306 $ 1,597 $ 54,903 We recognized $18.4 million, $11.1 million, and $9.1 million of operating lease revenue for the years ended December 31, 2022, 2021 and 2020, respectively, related to the cell site colocation space and dedicated fiber optic strands that we lease to our customers, which is included in service revenue and other in the consolidated statements of comprehensive (loss) income. Substantially all of our lease revenue relates to fixed lease payments. Below is a summary of our contractual minimum rental receipts expected under the lease agreements in place at December 31, 2022: (in thousands) Operating Leases 2023 $ 15,100 2024 13,710 2025 12,791 2026 9,754 2027 8,258 2028 and thereafter 21,572 Total $ 81,185 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt Our Credit Agreement, dated July 1, 2021 (the “Credit Agreement”) contains (i) a $100 million, five-year undrawn revolving credit facility (the “Revolver”), (ii) a $150 million five-year delayed draw amortizing term loan (“Term Loan A-1”) and (iii) a $150 million seven-year delayed draw amortizing term loan (“Term Loan A-2” and collectively with Term Loan A-1, the “Term Loans”). The following loans were outstanding under the Credit Agreement: (in thousands) December 31, December 31, Term loan A-1 $ 37,500 $ — Term loan A-2 37,500 — Total debt 75,000 — Less: unamortized loan fees (46) — Total debt, net of unamortized loan fees $ 74,954 $ — Both Term Loan A-1 and Term Loan A-2 bear interest at one-month LIBOR plus a margin of 1.50%. The margin of 1.50% is variable and determined by the Company’s net leverage ratio. Interest is paid monthly. The interest rate was 4.39% at December 31, 2022. Our cash payments for interest were $0.6 million, $10.4 million and $18.6 million for the years ended December 31, 2022, 2021 and 2020, respectively. Interest paid in 2021 and 2020 was incurred and paid under a prior credit agreement which was repaid in connection with the sale of the Wireless business in 2021. Refer to Note 15, Discontinued Operations , for details concerning the sale of the Wireless business. Shentel is charged commitment fees on unutilized portions of its Revolver and Term Loans. The Company recorded $0.7 million related to these fees for the year ended December 31, 2022, which is included in other (expense) income, net in the consolidated statements of comprehensive (loss) income. The Credit Agreement contains a borrowing deadline of June 30, 2023, after which the Company will not be able to borrow against the undrawn portion of the Term Loans. The Company expects to borrow the remaining $225.0 million available under the Term Loans by the borrowing deadline. The Credit Agreement includes various covenants, including total net leverage ratio and debt service coverage ratio financial covenants. The Credit Agreement is fully secured by a pledge and unconditional guarantee from the Company and all of its subsidiaries, except Shenandoah Telephone Company. This provides the lenders a security interest in substantially all of the assets of the Company. Shentel’s Term Loans require quarterly payments based on a percentage of the outstanding balance. Based on the outstanding balance as of December 31, 2022, Term Loan A-1 requires quarterly principal repayments of $0.2 million from September 30, 2023 through June 30, 2024; then increasing to $0.5 million quarterly from September 30, 2024 through March 31, 2026, with the remaining balance due June 30, 2026. Based on the outstanding balance as of December 31, 2022, Term Loan A-2 requires quarterly principal repayments of $0.1 million through March 31, 2028, with the remaining balance due June 30, 2028. These scheduled payments are also summarized below: (in thousands) Amount 2023 $ 656 2024 1,781 2025 2,250 2026 34,125 2027 375 2028 and thereafter 35,813 Total $ 75,000 Shentel has not made any borrowings under its Revolver as of December 31, 2022. In the event borrowings are made in the future, the entire outstanding principal amount borrowed is due June 30, 2026. The International Exchange (ICE) Benchmark Administration ceased the publication of one-week and two-month LIBOR on December 31, 2021 and the remaining tenors (overnight, one-month, three-month, six-month and 12-month) will cease to be published on June 30, 2023. Our term loans and revolver identify LIBOR as a reference rate for tenors ceasing on June 30, 2023 and maturing after 2023. Alternative reference rates that replace LIBOR may not yield the same or similar economic results over the terms of the financial instruments. The transition from LIBOR could result in us paying higher or lower interest rates on our current LIBOR-indexed term loans. Our Credit Agreement includes provisions that provide for the identification of a LIBOR replacement rate. Due to the uncertainty regarding the transition from LIBOR-indexed financial instruments and the manner in which an alternative reference rate will apply, we cannot yet reasonably estimate the expected financial impact of the LIBOR transition. Any changes to the reference rate will be agreed through an amendment to the Credit Agreement and are expected to reference the Secured Overnight Financing Rate, though the timing of such amendment and applicability to any future amounts owed under the Credit Agreement are not certain at this time. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company files a consolidated U.S. federal income tax return and various state income tax returns. The provision for the federal and state income taxes attributable to income (loss) consists of the following components: Years Ended December 31, (in thousands) 2022 2021 2020 Current expense (benefit) Federal taxes $ 673 $ (21,392) $ (13,748) State taxes (186) (2,565) (2,148) Total current provision 487 (23,957) (15,896) Deferred (benefit) expense Federal taxes (1,119) 25,518 13,325 State taxes (295) (3,255) 1,581 Total deferred (benefit) expense (1,414) 22,263 14,906 Income tax benefit $ (927) $ (1,694) $ (990) Effective tax rate 10.0 % (27.2) % (168.9) % A reconciliation of income tax expense (benefit) determined by applying the federal and state tax rates to income before income taxes is as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Expected tax (benefit) expense at federal statutory $ (1,954) $ 1,310 $ 24 State income taxes, net of federal tax effect (410) 438 54 Revaluation of deferred tax liabilities — (5,206) — Stranded tax effects reclassified from other comprehensive income — 1,620 — Excess tax expense (benefit) from share based compensation and other expense, net 818 144 (1,068) Valuation allowance 619 — — Income tax benefit $ (927) $ (1,694) $ (990) The change in effective tax rate between 2022 and 2021 was primarily a result of decreased income tax benefit due to a one-time benefit realized in 2021 as a result of the 2021 disposition of Wireless assets and operations (see Note 15, Discontinued Operations ). The Company's cash payments for income taxes were $0.1 million and $11.2 million for the years ended December 31, 2022 and 2021, respectively. The Company's cash refunds for income taxes were $9.5 million for the year ended December 31, 2020. Deferred tax assets and liabilities are measured using enacted tax rates that are expected to apply in the year of reversal or settlement and arise from temporary differences between the US GAAP and tax bases of the following assets and liabilities: (in thousands) December 31, December 31, Deferred tax assets: Leases $ 14,809 $ 15,483 Asset retirement obligations 2,972 2,581 Net operating loss carry-forwards 28,398 5,878 Pension liabilities 978 2,148 Accruals and stock-based compensation 3,087 2,572 Other 5,767 6,300 Total gross deferred tax assets 56,011 34,962 Less valuation allowance (619) — Net deferred tax assets 55,392 34,962 Deferred tax liabilities: Property, plant and equipment 109,852 92,449 Leases 14,541 15,410 Intangible assets 12,867 10,710 Prepaid assets and other 2,732 2,407 Total gross deferred tax liabilities 139,992 120,976 Net deferred tax liabilities $ 84,600 $ 86,014 The Company has a deferred tax asset of $28.4 million related to federal and various state net operating losses. As of December 31, 2022, the Company had approximately $125.6 million of federal net operating losses, including approximately $97.8 million of federal net operating losses generated after 2017. Federal net operating losses generated prior to 2018 expire through 2027. The Company also had approximately $40.0 million of state net operating losses, which can be carried forward indefinitely. The Company's income tax benefit for the year ended December 31, 2022 included tax expense of $0.6 million for a valuation allowance on deferred tax assets related to federal net operating losses expected to expire unutilized. The Company had no valuation allowances on deferred tax assets as of December 31, 2021. As of December 31, 2022 and 2021, the Company had no unrecognized tax benefits. |
Stock Compensation, Earnings pe
Stock Compensation, Earnings per Share, and Dividends | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Compensation, Earnings per Share, and Dividends | Stock Compensation, Earnings per Share, and Dividends The Company's 2014 Stock Incentive Plan (the “Plan”) allows for the grant of equity based incentive compensation to all employees. The Plan authorizes grants of up to an additional 4,200,000 shares over a ten-year period beginning in 2014. Under the Plan, grants may take the form of stock awards, awards of options to acquire stock, stock appreciation rights and other forms of equity based compensation; both options to acquire stock and stock awards were granted. As of December 31, 2022, the only forms of stock awards outstanding are RSUs and RTSRs. The Company granted approximately 518,000 RSUs at a weighted average grant price of $21.56 to employees and directors during the year ended December 31, 2022. Approximately 153,000 RSUs with a weighted average grant price of $27.50 vested and 53,000 RSUs with a weighted average grant price of $25.89 were forfeited during the year ended December 31, 2022. The total fair value of RSUs vested was $3.3 million during the year ended December 31, 2022. Approximately 649,000 RSUs with a weighted average grant price of $23.39 remained outstanding as of December 31, 2022. The Company granted approximately 100,000 RTSRs at a weighted average grant price of $23.83 to employees during the year ended December 31, 2022. Approximately 46,000 RTSRs with a weighted average grant price of $33.83 vested and 6,000 RTSRs with a weighted average grant price of $36.28 were forfeited during the year ended December 31, 2022. The total fair value of RSUs vested was $1.2 million during the year ended December 31, 2022. Approximately 202,000 RTSRs with a weighted average grant price of $29.46 remained outstanding as of December 31, 2022. As described above, the amount of RTSRs issued are adjusted on the vesting date. The amounts above exclude the adjustment and issuance of RTSRs based on actual performance, which totaled approximately 9,000 awards for the year ended December 31, 2022. The Company's RSUs generally have service conditions only or performance and service conditions with vesting periods ranging from one year for directors to five years for employees. RTSR awards vest approximately three years from the grant date. The performance condition applied to the RTSR awards is based upon the Company's stock performance compared to a group of peer companies. The actual number of shares to be issued can range from 0% to 150% of the awards granted. Stock-based compensation expense was as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Stock compensation expense $ 9,142 $ 3,552 $ 6,227 Capitalized stock compensation 614 144 320 Stock compensation expense, net $ 8,528 $ 3,408 $ 5,907 As of December 31, 2022, there was $9.2 million of total unrecognized compensation cost related to non-vested incentive awards which is expected to be recognized over weighted average period of 2.4 years. We utilize the treasury stock method to calculate the impact on diluted earnings per share that potentially dilutive stock-based compensation awards have. The following table indicates the computation of basic and diluted earnings per share: Years Ended December 31, (in thousands, except per share amounts) 2022 2021 2020 Calculation of net income per share: (Loss) income from continuing operations $ (8,379) $ 7,929 $ 1,576 Income from discontinued operations, net of tax $ — $ 990,902 $ 124,097 Net (loss) income $ (8,379) $ 998,831 $ 125,673 Basic weighted average shares outstanding 50,155 50,026 49,901 Basic net (loss) income per share - continuing operations $ (0.17) $ 0.16 $ 0.03 Basic net income per share - discontinued operations $ — $ 19.81 $ 2.49 Basic net (loss) income per share $ (0.17) $ 19.97 $ 2.52 Effect of stock-based compensation awards outstanding: Basic weighted average shares outstanding 50,155 50,026 49,901 Effect from dilutive shares and options outstanding — 123 123 Diluted weighted average shares outstanding 50,155 50,149 50,024 Diluted net (loss) income per share - continuing operations $ (0.17) $ 0.16 $ 0.03 Diluted net income per share - discontinued operations $ — $ 19.76 $ 2.48 Diluted net (loss) income per share $ (0.17) $ 19.92 $ 2.51 There were approximately 365,000, 259,000, and 30,000 anti-dilutive awards outstanding for the years ended December 31, 2022, 2021 and 2020, respectively. The Company paid a special dividend of $18.75 per share on August 2, 2021 (the “Special Dividend”). The total amount paid pursuant to the Special Dividend to Shentel shareholders, including amounts reinvested in the Company’s stock via the Company’s Dividend Reinvestment Plan, was approximately $937 million. |
Government Grants
Government Grants | 12 Months Ended |
Dec. 31, 2022 | |
Government Grants [Abstract] | |
Government Grants | Government GrantsIn 2021, Shentel commenced negotiations with various governmental entities to receive awards under broadband infrastructure grant programs to strategically expand the Company's broadband network in order to provide broadband services to unserved residences in the partnering counties in Virginia, Maryland and West Virginia. Throughout 2021 and 2022, in partnership with counties in the respective states, Shentel has been awarded grants under the Virginia Telecommunication Initiative (“VATI”) and the Rural Digital Opportunity Fund (“RDOF”) in Virginia, the Connect Maryland Network Infrastructure Grant Program (“Connect MD”) in Maryland, and the Major Broadband Projects Strategies (“MBPS”) in West Virginia. The following table summarizes the awards under each program: (in thousands) Awards VATI $ 58,918 RDOF 887 Connect MD 10,200 MBPS 1,349 Total $ 71,354 To receive such grant distributions, we entered into agreements with each partnering county in Virginia and Maryland and expect to complete similar agreement in West Virginia. These agreements outline certain build-out milestones. The network is required to meet certain performance conditions to ensure that minimum download and upload speeds are able to be provided to the underserved residences. The Company recognizes grant receivables at the time it becomes probable that the Company will be eligible to receive the grant, which is estimated to correspond with the date when specified build-out milestones are achieved. The grant is treated as a reduction to the corresponding property, plant and equipment asset balance and is recognized through a reduction in depreciation expense over the life of the corresponding asset. Reimbursable amounts are dependent upon the actual construction costs. The Company has not recognized any amounts under these programs as of December 31, 2022 and 2021. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We are committed to make payments to satisfy our lease liabilities. The scheduled payments under those obligations are summarized in Note 8, Leases . We also have outstanding unconditional purchase commitments to procure marketing services and IT software licenses through 2026. For the years ended December 31, 2022, 2021 and 2020 we paid $5.2 million, $3.4 million and $1.4 million, respectively, for the programming, marketing and IT software license purchase commitments. The Company is obligated to make the following future minimum payments under the non-cancelable terms of these commitments as of December 31, 2022: (in thousands) Purchase Commitments 2023 $ 4,684 2024 3,267 2025 1,993 2026 1,044 2027 609 2028 and thereafter 109 Total $ 11,706 The Company is subject to claims and legal actions that may arise in the ordinary course of business. The Company does not believe that any of these pending claims or legal actions are either probable or reasonably possible of a material loss. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting The divestiture of our Wireless operations on July 1, 2021 represented a strategic shift in the Company’s business which therefore qualified the segment as a discontinued operation. As a result, for all periods presented, the operating results and cash flows related to the Wireless segment were reflected as a discontinued operation in our consolidated statements of comprehensive (loss) income and the consolidated statements of cash flows. The tables below reflect the results of operations of the Company's reportable segments in continuing operations, consistent with internal reporting used by the Company. Intercompany revenue is primarily derived from services provided to the discontinued operation, for periods prior to the divestiture. Year ended December 31, 2022: (in thousands) Broadband Tower Corporate & Eliminations Consolidated External revenue Residential & SMB $ 193,974 $ — $ — $ 193,974 Commercial Fiber 38,821 — — 38,821 RLEC & Other 16,035 — — 16,035 Tower lease — 18,541 — 18,541 Service revenue and other 248,830 18,541 — 267,371 Intercompany revenue and other 185 378 (563) — Total revenue 249,015 18,919 (563) 267,371 Operating expenses Cost of services 102,267 5,712 (433) 107,546 Selling, general and administrative 56,776 1,279 34,337 92,392 Restructuring expense 849 — 402 1,251 Impairment expense 5,241 — — 5,241 Depreciation and amortization 63,175 2,416 3,308 68,899 Total operating expenses 228,308 9,407 37,614 275,329 Operating income (loss) $ 20,707 $ 9,512 $ (38,177) $ (7,958) Capital expenditures $ 188,729 $ 620 $ 260 $ 189,609 Year ended December 31, 2021: (in thousands) Broadband Tower Corporate & Eliminations Consolidated External revenue Residential & SMB $ 177,530 $ — $ — $ 177,530 Commercial Fiber 30,842 — — 30,842 RLEC & Other 15,249 — — 15,249 Tower lease — 12,393 — 12,393 Service revenue and other 223,621 12,393 — 236,014 Revenue for service provided to the discontinued Wireless operations 4,459 5,311 (545) 9,225 Total revenue 228,080 17,704 (545) 245,239 Operating expenses Cost of services 97,283 5,438 (422) 102,299 Selling, general and administrative 47,840 1,197 33,414 82,451 Restructuring expense 202 — 1,525 1,727 Impairment expense 5,986 — — 5,986 Depreciation and amortization 47,937 2,053 5,216 55,206 Total operating expenses 199,248 8,688 39,733 247,669 Operating income (loss) $ 28,832 $ 9,016 $ (40,278) $ (2,430) Capital expenditures $ 156,131 $ 977 $ 2,993 $ 160,101 Year ended December 31, 2020: (in thousands) Broadband Tower Corporate & Eliminations Consolidated External revenue Residential & SMB $ 154,956 $ — $ — $ 154,956 Commercial Fiber 24,431 — — 24,431 RLEC & Other 15,971 — — 15,971 Tower lease — 7,402 — 7,402 Service revenue and other 195,358 7,402 — 202,760 Revenue for service provided to the discontinued Wireless operations 8,989 9,653 (627) 18,015 Total revenue 204,347 17,055 (627) 220,775 Operating expenses Cost of services 84,893 4,896 (132) 89,657 Selling, general and administrative 39,472 1,430 44,114 85,016 Depreciation and amortization 41,076 1,906 5,721 48,703 Total operating expenses 165,441 8,232 49,703 223,376 Operating income (loss) $ 38,906 $ 8,823 $ (50,330) $ (2,601) Capital expenditures $ 117,246 $ 2,001 $ 1,203 $ 120,450 A reconciliation of the total of the reportable segments’ operating (loss) income to consolidated (loss) income from continuing operations before income taxes is as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Total consolidated operating loss $ (7,958) $ (2,430) $ (2,601) Other (expense) income, net (1,348) 8,665 3,187 (Loss) income from continuing operations before income taxes $ (9,306) $ 6,235 $ 586 The Company’s CODM does not currently review total assets by segment since the assets are centrally managed and some of the assets are shared by the segments, accordingly total assets by segment are not applicable. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations On July 1, 2021, pursuant to the Asset Purchase Agreement (the “Purchase Agreement”), dated May 28, 2021, between Shentel and T-Mobile, Shentel completed the sale to T-Mobile of its Wireless assets and operations for cash consideration of approximately $1.94 billion, inclusive of the approximately $60 million settlement of the waived management fees by Sprint, and net of certain transaction expenses (the “Transaction”). The assets and liabilities that transferred in the Transaction (the “disposal group”) were presented as held for sale within our historical consolidated balance sheets, and discontinued operations within our historical consolidated statements of comprehensive (loss) income. Income from discontinued operations, net of tax in the consolidated statements of comprehensive income consist of the following for the years ended December 31, 2021 and 2020: (in thousands) Revenue: 2021 2020 Service revenue and other $ 201,076 $ 401,035 Equipment revenue 12,253 41,338 Total revenue 213,329 442,373 Operating expenses: Cost of services 38,144 116,394 Cost of goods sold 11,964 40,642 Selling, general and administrative 17,514 34,011 Severance expense 465 — Depreciation and amortization — 62,930 Total operating expenses 68,087 253,977 Operating income 145,242 188,396 Other (expense) income: Debt extinguishment (11,032) — Interest expense and other, net (9,178) (20,455) Gain on sale of disposition of Wireless assets and operations 1,227,531 — Income before income taxes 1,352,563 167,941 Income tax expense 361,661 43,844 Income from discontinued operations, net of tax $ 990,902 $ 124,097 There was no material income from discontinued operations for the year ended December 31, 2022. |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2022 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II Valuation and Qualifying Accounts | Schedule II Valuation and Qualifying Accounts Changes in the Company’s allowance for doubtful accounts for accounts receivable for the years ended December 31, 2022, 2021 and 2020 are summarized below: (in thousands) Balance at Beginning of Year Recoveries added to allowance Bad debt expense Write-offs Balance at End of Year Year Ended December 31, 2022 Allowance for doubtful accounts $ 352 $ 414 $ 1,972 $ (1,962) $ 776 Year Ended December 31, 2021 Allowance for doubtful accounts $ 614 $ 530 $ 1,028 $ (1,820) $ 352 Year Ended December 31, 2020 Allowance for doubtful accounts $ 533 $ 758 $ 1,220 $ (1,897) $ 614 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Principles of consolidation | The accompanying consolidated financial statements include the accounts of Shenandoah Telecommunications Company and all of its wholly owned subsidiaries. All intercompany accounts and transactions for continuing operations have been eliminated in consolidation. |
Use of estimates | The preparation of financial statements in conformity with accounting principles generally accepted in the United States, requires us to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses and related disclosures. Due to the inherent uncertainty involved in making estimates, actual results to be reported in future periods could differ from our estimates. |
Revenue recognition | The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from contracts with customers, (“ASC 606”). Our Broadband segment provides broadband data, video and voice services to residential, small and midsize businesses (“SMB”) and commercial customers in portions of Virginia, West Virginia, Maryland, Pennsylvania and Kentucky, via fiber optic and hybrid fiber coaxial cable networks. The Broadband segment also provides voice and DSL telephone services to customers in Virginia’s Shenandoah County and portions of adjacent counties as an RLEC. These contracts are generally cancellable at the customer’s discretion without penalty at any time. Transaction price is measured as the amount billed, which is generally determined by list prices for goods and services less discounts offered. We allocate the total transaction price in these transactions based upon the standalone selling price of each distinct good or service. We generally recognize these revenues over time as customers simultaneously receive and consume the benefits of the service, with the exception of equipment sales and home wiring, which are recognized as revenue at a point in time when control transfers and when installation is complete, respectively. A significant portion of the Company’s revenues are derived from customers who may cancel their subscriptions at any time without penalty. As such, the amount of deferred revenue related to unsatisfied performance obligations is not necessarily indicative of the future revenue to be recognized from the Company’s existing customers. Installation fees charged upfront without transfer of commensurate goods or services to the customer are allocated to services and are recognized ratably over the longer of the contract term or the period in which the unrecognized fee remains material to the contract, which we estimate to be one year. Additionally, the Company incurs commission expenses related to in-house and third-party vendors which are capitalized and amortized over the expected customer benefit period. Our Broadband segment also provides Ethernet and Wavelength fiber optic services to commercial fiber customers under capacity agreements, and the related revenue is recognized over time. In some cases, non-refundable upfront fees are charged for connecting commercial fiber customers to our fiber network. Those amounts are recognized ratably over the initial contract term. The Broadband segment also leases dedicated fiber optic strands to customers as part of “dark fiber” agreements, which are accounted for as leases under ASC 842, Leases (“ASC 842”). Our Tower segment leases space on owned cell towers to our Broadband segment, and to other wireless carriers. Revenue from these leases is accounted for under ASC 842. |
Advertising Costs | The Company expenses advertising costs and marketing production costs as incurred and includes such costs within selling, general and administrative expenses in the consolidated statements of operations. |
Fair value measurements | The Company measures certain assets and liabilities at fair value. Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company uses the fair value hierarchy to evaluate inputs used in determining the fair value of its assets and liabilities. The three levels of inputs used to measure fair value are (i) observable inputs, such as quoted prices in active markets (level 1); (ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (level 2); and (iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (level 3). The Company remeasures long-lived assets such as property, plant and equipment, intangible assets and goodwill at fair value when they are deemed to be impaired. The fair value of these assets is determined with valuation techniques using the best information available and may include quoted market prices, market comparables or discounted cash flow models. The carrying amounts reported in the Company’s consolidated financial statements for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of the short-term nature of these financial instruments. The carrying amount of the Company's debt balance from term loans, which have a floating interest rate, approximate fair value. |
Cash and cash equivalents | Cash equivalents include all investments with an original maturity of three months or less. The Company places its temporary cash investments with high credit quality financial institutions. Generally, such investments are in excess of FDIC or SIPC insurance limits. |
Allowance for doubtful accounts | Accounts receivable have been reduced by an allowance for amounts that may be uncollectible in the future. This estimated allowance is based primarily on the aging category, historical collection experience and management’s evaluation of the financial condition of the customer. The Company writes off accounts receivable balances deemed uncollectible against the allowance for credit losses generally when the account is turned over for collection to an outside collection agency. |
Investments | The Company investments measured at fair value primarily consist of Supplemental executive retirement plan (“SERP”) investments in a rabbi trust as a source of funding for future payments under the plan. The SERP’s investments were designated as trading securities and will be liquidated and paid out to the participants six months after retirement. The benefit obligation to participants is always equal to the value of the SERP assets under ASC 710, Compensation . SERP investments at fair value: The fair value of the SERP investments are based on unadjusted quoted prices in active markets and are classified as Level 1 of the fair value hierarchy. Changes to the investments' fair value are presented in Other income (expense), while the reciprocal changes in the liability are presented in selling, general and administrative expense. At December 31, 2021, $0.8 million of SERP investments were presented as prepaid expenses and other (current assets). Those investments were liquidated in July 2022 to pay the current portion of our SERP obligation. Cost method investments : Our investment in CoBank’s Class A common stock, derived from the CoBank patronage program, represented substantially all of our cost method investments with a balance of $10.0 million and $10.3 million at December 31, 2022 and 2021, respectively. We recognized approximately $70.7 thousand, $2.0 million and $4.2 million of patronage income in other income (expense) in 2022, 2021 and 2020, respectively. Historically, approximately 75% of the patronage distributions were collected in cash and 25% in equity. Equity method investments: At December 31, 2022, the Company had a 20.0% ownership interest in Valley Network Partnership (“ValleyNet”). The Company and ValleyNet purchase capacity on one another’s fiber network through related party transactions. We recognized revenue of $0.7 million, $0.7 million, and $0.9 million from providing service to ValleyNet during 2022, 2021, and 2020, respectively. We recognized cost of service of $0.1 million, $1.2 million, and $2.7 million for the use of ValleyNet’s network during 2022, 2021, and 2020, respectively. |
Property, plant and equipment | Property, plant and equipment is stated at cost less accumulated depreciation and amortization. The Company capitalizes all costs associated with the purchase, deployment and installation of property, plant and equipment, including interest costs and internal labor costs on major capital projects during the period of their construction. Maintenance expense is recognized as incurred when repairs are performed that do not extend the life of property, plant and equipment. Expenses for major renewals and improvements, which significantly extend the useful lives of existing property and equipment, are capitalized and depreciated. Depreciation is calculated on the straight-line method over the estimated useful lives of the assets. Labor costs associated with customer installation activities at existing service locations are expensed as incurred under industry specific guidance. Leasehold improvements are amortized over the lesser of their useful lives or respective lease terms. Land is not depreciated. Refer to Note 5, Property, Plant and Equipment , for additional information. |
Indefinite-lived Intangible Assets | Goodwill represents the excess of acquisition costs over the fair value of tangible net assets and identifiable intangible assets of the businesses acquired. Cable franchise rights provide us with the non-exclusive right to provide video services in a specified area. Spectrum licenses are issued by the Federal Communications Commission (“FCC”) and provide us with either an exclusive or priority access right to utilize designated radio frequency spectrum within specific geographic service areas to provide wireless communication services. While some cable franchises and spectrum licenses are issued for a fixed time (generally ten years and up to fifteen years, respectively), renewals have been granted routinely and at nominal costs. The Company believes it will be able to meet all requirements necessary to secure renewal of its cable franchise rights and spectrum licenses. Moreover, the Company has determined that there are currently no legal, regulatory, contractual, competitive, economic or other factors that limit the useful lives of our cable franchises or spectrum licenses and as a result, we account for cable franchise rights and spectrum licenses as indefinite-lived intangible assets.Indefinite-lived intangible assets are not amortized, but rather, are subject to impairment testing annually, in the fourth quarter, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. Goodwill is evaluated for impairment based on the identification of reporting units. Our reporting units align with our reportable segments. We evaluated our reporting units for impairment on October 1, 2022 on the basis of qualitative factors. Our consideration of qualitative factors included but was not limited to macroeconomic conditions, industry and market conditions, company specific events, changes in circumstances, after tax cash flows and market capitalization trends. |
Long-lived assets | Finite-lived intangible assets, property, plant, and equipment, and other long-lived assets held for use are amortized or depreciated over their estimated useful lives, as summarized in the respective notes below. These assets are evaluated for impairment based on the identification of asset groups. Our asset groups align with our reportable segments. We evaluated our asset groups for impairment during the fourth quarter of 2022 and concluded that there were no indicators that an asset group impairment was more likely than not, with the exception of those described in Note 5, Property, Plant and Equipment. |
Asset retirement obligations | Certain of the Company’s lease agreements contain provisions requiring the Company to restore facilities or remove property in the event that the lease agreement is not renewed. The Company records an estimate for the cost to comply with these provisions based on what a willing third party would charge for the retirement activity on the date of recognizing the asset retirement obligation. Upon retirement of the related asset and performance of the asset retirement activities, the Company derecognizes the asset retirement obligation and records a gain or loss to reflect the difference between the Company's estimate and the actual cost to retire the asset. |
Leases | The Company leases various telecommunications sites, warehouses, retail stores, and office facilities for use in our business. These agreements include fixed rental payments as well as variable rental payments such as those based on relevant inflation indices. The accounting lease term includes optional renewal periods that we are reasonably certain to exercise based on our assessment of relevant contractual and economic factors. The related lease payments are discounted at lease commencement using the Company's incremental borrowing rate in order to measure the lease liability and right-of-use asset.The incremental borrowing rate is determined using a portfolio approach based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Company uses the observable unsecured borrowing rate and risk-adjusts that rate to approximate a collateralized rate. |
Leases | The Company leases various telecommunications sites, warehouses, retail stores, and office facilities for use in our business. These agreements include fixed rental payments as well as variable rental payments such as those based on relevant inflation indices. The accounting lease term includes optional renewal periods that we are reasonably certain to exercise based on our assessment of relevant contractual and economic factors. The related lease payments are discounted at lease commencement using the Company's incremental borrowing rate in order to measure the lease liability and right-of-use asset.The incremental borrowing rate is determined using a portfolio approach based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Company uses the observable unsecured borrowing rate and risk-adjusts that rate to approximate a collateralized rate. |
Income taxes | The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. In assessing the ability to realize deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon generating future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income, taxable income in prior carryback years if available and tax planning strategies in making this assessment. Based upon the level of historical taxable income, projections for future taxable income over the periods for which the deferred tax assets are deductible, and the option to elect out of bonus depreciation on in-serviced fixed assets, the Company believes it more likely than not that the net deferred tax assets will be realized. The Company recognizes a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. The Company records a liability for the difference between the benefit recognized and measured for financial statement purposes and the tax position taken or expected to be taken on the tax return. Changes in the estimate are recorded in the period in which such determination is made. |
Stock-based compensation | The cost of employee services received in exchange for share-based awards classified as equity is measured using the estimated fair value of the award on the date of the grant, and the related expense is recorded using the straight-line method consistent with the recipient's respective service period. The fair value for the Company's restricted stock units (“RSUs”) are determined using the Company's stock price and the fair value for the Company's Relative Total Shareholder Return (“RTSR”) awards are determined using a Monte Carlo simulation. The Company records forfeitures for its RSUs and RTSRs as they occur. Certain of the Company's share-based awards contain retirement clauses which state that awards will continue to vest without the requirement of continuous employment after a participant achieves certain service- and age-based requirements (“Retirement Eligibility”). The Company accelerates expense associated with eligible awards for employees who have achieved Retirement Eligibility on the later of the grant date or the date in which Retirement Eligibility is achieved. |
Segments | The Company’s chief operating decision maker (“CODM”) regularly reviews the Company’s results to assess performance and allocates resources at the level of the Company's two operating segments, Broadband and Tower. Given the differences in the characteristics of the Company's operating segments, management has determined that the operating segments cannot be combined into one reportable segment. As such, the Company has two reportable segments, Broadband and Tower. |
New Accounting Standards | In November 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2021-10, “ Government Assistance (Topic 832), Disclosures by Business Entities About Government Assistance, ” (“ASU 2021-10”) which requires entities to provide disclosures on material government assistance transactions for annual reporting periods. The disclosures include information about the nature of the assistance, the related accounting policies used to account for government assistance, the effect of government assistance on the entity’s financial statements and any significant terms and conditions of the agreements, including commitments and contingencies. We adopted ASU 2021-10 in 2022 and have included the new disclosure requirements in Note 12, Government Grants . |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Defined Benefit Plans Disclosures | Benefit plan obligations: The Benefit Plan Obligations caption includes the following: ($ in thousands) December 31, 2022 December 31, 2021 Pension plan $ — $ 2,393 Postretirement medical benefits plan 1,869 3,506 Supplemental executive retirement plan 1,889 2,317 Total $ 3,758 $ 8,216 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Amortized and Capitalized Contract Cost | The following tables present the activity of current and non-current contract assets: (in thousands) 2022 2021 Beginning Balance $ 8,147 $ 7,358 Commission payments 3,355 3,229 Contract asset amortization (2,856) (2,440) Ending Balance $ 8,646 $ 8,147 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments [Abstract] | |
Other Investments | Investments consist of the following: (in thousands) December 31, December 31, SERP investments at fair value $ 1,889 $ 2,317 Cost method investments 10,749 11,004 Equity method investments 333 340 Total investments $ 12,971 $ 13,661 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consist of the following: (in thousands) Estimated Useful Lives December 31, December 31, Land $ 3,722 $ 3,771 Land improvements 10 years 3,483 3,478 Buildings and structures 10 - 45 years 93,461 96,323 Cable and fiber 15 - 30 years 593,771 453,405 Equipment and software 4 - 8 years 317,347 391,293 Plant in service 1,011,784 948,270 Plant under construction 144,534 79,963 Total property, plant and equipment 1,156,318 1,028,233 Less: accumulated depreciation and amortization (468,765) (474,071) Property, plant and equipment, net $ 687,553 $ 554,162 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Resulting from Acquisition | The Company’s goodwill and intangible assets consist of the following: December 31, 2022 December 31, 2021 (in thousands) Gross Accumulated Amortization and Other Net Gross Accumulated Amortization and Other Net Goodwill - Broadband $ 3,244 $ — $ 3,244 $ 3,244 $ — $ 3,244 Indefinite-lived intangibles: Cable franchise rights $ 64,334 $ — $ 64,334 $ 64,334 $ — $ 64,334 FCC spectrum licenses 12,122 — 12,122 13,839 — 13,839 Railroad crossing rights 141 — 141 141 — 141 Total indefinite-lived intangibles 76,597 — 76,597 78,314 — 78,314 Finite-lived intangibles: FCC spectrum licenses — — — 6,811 (672) 6,139 Subscriber relationships 28,425 (26,910) 1,515 28,425 (26,451) 1,974 Other intangibles 488 (329) 159 463 (303) 160 Total finite-lived intangibles 28,913 (27,239) 1,674 35,699 (27,426) 8,273 Total goodwill and intangible assets $ 108,754 $ (27,239) $ 81,515 $ 117,257 $ (27,426) $ 89,831 |
Schedule of Finite-Lived Intangible Assets | The Company’s goodwill and intangible assets consist of the following: December 31, 2022 December 31, 2021 (in thousands) Gross Accumulated Amortization and Other Net Gross Accumulated Amortization and Other Net Goodwill - Broadband $ 3,244 $ — $ 3,244 $ 3,244 $ — $ 3,244 Indefinite-lived intangibles: Cable franchise rights $ 64,334 $ — $ 64,334 $ 64,334 $ — $ 64,334 FCC spectrum licenses 12,122 — 12,122 13,839 — 13,839 Railroad crossing rights 141 — 141 141 — 141 Total indefinite-lived intangibles 76,597 — 76,597 78,314 — 78,314 Finite-lived intangibles: FCC spectrum licenses — — — 6,811 (672) 6,139 Subscriber relationships 28,425 (26,910) 1,515 28,425 (26,451) 1,974 Other intangibles 488 (329) 159 463 (303) 160 Total finite-lived intangibles 28,913 (27,239) 1,674 35,699 (27,426) 8,273 Total goodwill and intangible assets $ 108,754 $ (27,239) $ 81,515 $ 117,257 $ (27,426) $ 89,831 |
Schedule of Finite Lived Intangible Assets, Amortization, Estimated Useful Lives | Our finite-lived intangible assets are amortized over the following estimated useful lives: Estimated Useful Life Subscriber relationships 3 - 10 years Other intangibles 15 - 20 years |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The following table summarizes expected amortization of intangible assets at December 31, 2022: (in thousands) Amortization of Intangible Assets 2023 $ 489 2024 489 2025 483 2026 103 2027 65 Thereafter 45 Total $ 1,674 |
Other Assets and Accrued Liab_2
Other Assets and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Current Assets | Prepaid expenses and other, classified as current assets, included the following: (in thousands) December 31, December 31, Deposit for FCC spectrum licenses $ — $ 16,118 Prepaid maintenance expenses 7,444 8,391 Broadband contract acquisition costs 2,809 2,502 SERP investments — 801 Other 1,256 2,018 Prepaid expenses and other $ 11,509 $ 29,830 |
Schedule of Other Assets, Noncurrent | Deferred charges and other assets, classified as long-term assets, included the following: (in thousands) December 31, December 31, Broadband contract acquisition costs $ 5,837 $ 5,645 Prepaid expenses and other 7,422 4,653 Deferred charges and other assets $ 13,259 $ 10,298 |
Summary of Accrued Liabilities and Other | Accrued liabilities and other, classified as current liabilities, included the following: (in thousands) December 31, December 31, Accrued programming costs 3,306 $ 3,084 Pension plan 3,341 — Restructuring accrual 146 1,761 Other current liabilities 11,113 9,804 Accrued liabilities and other $ 17,906 $ 14,649 |
Other Noncurrent Liabilities | Other liabilities, classified as long-term liabilities, included the following: (in thousands) December 31, December 31, Noncurrent portion of deferred revenue $ 18,679 $ 19,749 Noncurrent portion of financing leases 1,500 1,614 FCC spectrum license obligations — 3,807 Other 39 461 Other liabilities $ 20,218 $ 25,631 |
Schedule of Change in Asset Retirement Obligation | Our asset retirement obligations (“ARO”) arise from certain of our leases and generally require us to remove our towers from ground leases. Current ARO liabilities are recorded in accrued liabilities and other in the Company’s consolidated balance sheets. Below is a summary of our current and non-current asset retirement obligations: Years Ended December 31, (in thousands) 2022 2021 2020 Balance at beginning of year $ 9,824 $ 5,113 $ 6,152 Additional asset retirement obligations recorded and changes to prior estimates 1,198 4,290 (1,371) Liabilities settled (185) — — Accretion expense 531 421 332 Balance at end of year $ 11,368 $ 9,824 $ 5,113 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Expected Maturity of Lease Liabilities, Operating | The following table summarizes the expected maturity of lease liabilities at December 31, 2022: (in thousands) Operating Leases Finance Leases Total 2023 $ 4,987 $ 176 $ 5,163 2024 5,102 178 5,280 2025 4,897 180 5,077 2026 4,405 153 4,558 2027 3,634 155 3,789 2028 and thereafter 64,443 1,359 65,802 Total lease payments 87,468 2,201 89,669 Less: interest (34,162) (604) (34,766) Present value of lease liabilities $ 53,306 $ 1,597 $ 54,903 |
Expected Maturity of Lease Liabilities, Financing | The following table summarizes the expected maturity of lease liabilities at December 31, 2022: (in thousands) Operating Leases Finance Leases Total 2023 $ 4,987 $ 176 $ 5,163 2024 5,102 178 5,280 2025 4,897 180 5,077 2026 4,405 153 4,558 2027 3,634 155 3,789 2028 and thereafter 64,443 1,359 65,802 Total lease payments 87,468 2,201 89,669 Less: interest (34,162) (604) (34,766) Present value of lease liabilities $ 53,306 $ 1,597 $ 54,903 |
Minimum Rental Receipts Under Lease Agreement Lessor, Operating Leases | Below is a summary of our contractual minimum rental receipts expected under the lease agreements in place at December 31, 2022: (in thousands) Operating Leases 2023 $ 15,100 2024 13,710 2025 12,791 2026 9,754 2027 8,258 2028 and thereafter 21,572 Total $ 81,185 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | The following loans were outstanding under the Credit Agreement: (in thousands) December 31, December 31, Term loan A-1 $ 37,500 $ — Term loan A-2 37,500 — Total debt 75,000 — Less: unamortized loan fees (46) — Total debt, net of unamortized loan fees $ 74,954 $ — |
Maturities of Long-term Debt | These scheduled payments are also summarized below: (in thousands) Amount 2023 $ 656 2024 1,781 2025 2,250 2026 34,125 2027 375 2028 and thereafter 35,813 Total $ 75,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Components of Federal and State Income Taxes | The provision for the federal and state income taxes attributable to income (loss) consists of the following components: Years Ended December 31, (in thousands) 2022 2021 2020 Current expense (benefit) Federal taxes $ 673 $ (21,392) $ (13,748) State taxes (186) (2,565) (2,148) Total current provision 487 (23,957) (15,896) Deferred (benefit) expense Federal taxes (1,119) 25,518 13,325 State taxes (295) (3,255) 1,581 Total deferred (benefit) expense (1,414) 22,263 14,906 Income tax benefit $ (927) $ (1,694) $ (990) Effective tax rate 10.0 % (27.2) % (168.9) % |
Reconciliation of Income Taxes | A reconciliation of income tax expense (benefit) determined by applying the federal and state tax rates to income before income taxes is as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Expected tax (benefit) expense at federal statutory $ (1,954) $ 1,310 $ 24 State income taxes, net of federal tax effect (410) 438 54 Revaluation of deferred tax liabilities — (5,206) — Stranded tax effects reclassified from other comprehensive income — 1,620 — Excess tax expense (benefit) from share based compensation and other expense, net 818 144 (1,068) Valuation allowance 619 — — Income tax benefit $ (927) $ (1,694) $ (990) |
Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities are measured using enacted tax rates that are expected to apply in the year of reversal or settlement and arise from temporary differences between the US GAAP and tax bases of the following assets and liabilities: (in thousands) December 31, December 31, Deferred tax assets: Leases $ 14,809 $ 15,483 Asset retirement obligations 2,972 2,581 Net operating loss carry-forwards 28,398 5,878 Pension liabilities 978 2,148 Accruals and stock-based compensation 3,087 2,572 Other 5,767 6,300 Total gross deferred tax assets 56,011 34,962 Less valuation allowance (619) — Net deferred tax assets 55,392 34,962 Deferred tax liabilities: Property, plant and equipment 109,852 92,449 Leases 14,541 15,410 Intangible assets 12,867 10,710 Prepaid assets and other 2,732 2,407 Total gross deferred tax liabilities 139,992 120,976 Net deferred tax liabilities $ 84,600 $ 86,014 |
Stock Compensation, Earnings _2
Stock Compensation, Earnings per Share, and Dividends (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Compensation Expense | Stock-based compensation expense was as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Stock compensation expense $ 9,142 $ 3,552 $ 6,227 Capitalized stock compensation 614 144 320 Stock compensation expense, net $ 8,528 $ 3,408 $ 5,907 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table indicates the computation of basic and diluted earnings per share: Years Ended December 31, (in thousands, except per share amounts) 2022 2021 2020 Calculation of net income per share: (Loss) income from continuing operations $ (8,379) $ 7,929 $ 1,576 Income from discontinued operations, net of tax $ — $ 990,902 $ 124,097 Net (loss) income $ (8,379) $ 998,831 $ 125,673 Basic weighted average shares outstanding 50,155 50,026 49,901 Basic net (loss) income per share - continuing operations $ (0.17) $ 0.16 $ 0.03 Basic net income per share - discontinued operations $ — $ 19.81 $ 2.49 Basic net (loss) income per share $ (0.17) $ 19.97 $ 2.52 Effect of stock-based compensation awards outstanding: Basic weighted average shares outstanding 50,155 50,026 49,901 Effect from dilutive shares and options outstanding — 123 123 Diluted weighted average shares outstanding 50,155 50,149 50,024 Diluted net (loss) income per share - continuing operations $ (0.17) $ 0.16 $ 0.03 Diluted net income per share - discontinued operations $ — $ 19.76 $ 2.48 Diluted net (loss) income per share $ (0.17) $ 19.92 $ 2.51 |
Government Grants (Tables)
Government Grants (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Government Grants [Abstract] | |
Schedule of Awards Under Each Program | The following table summarizes the awards under each program: (in thousands) Awards VATI $ 58,918 RDOF 887 Connect MD 10,200 MBPS 1,349 Total $ 71,354 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Long-term Purchase Commitment | The Company is obligated to make the following future minimum payments under the non-cancelable terms of these commitments as of December 31, 2022: (in thousands) Purchase Commitments 2023 $ 4,684 2024 3,267 2025 1,993 2026 1,044 2027 609 2028 and thereafter 109 Total $ 11,706 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Selected Financial Data for Segments | The tables below reflect the results of operations of the Company's reportable segments in continuing operations, consistent with internal reporting used by the Company. Intercompany revenue is primarily derived from services provided to the discontinued operation, for periods prior to the divestiture. Year ended December 31, 2022: (in thousands) Broadband Tower Corporate & Eliminations Consolidated External revenue Residential & SMB $ 193,974 $ — $ — $ 193,974 Commercial Fiber 38,821 — — 38,821 RLEC & Other 16,035 — — 16,035 Tower lease — 18,541 — 18,541 Service revenue and other 248,830 18,541 — 267,371 Intercompany revenue and other 185 378 (563) — Total revenue 249,015 18,919 (563) 267,371 Operating expenses Cost of services 102,267 5,712 (433) 107,546 Selling, general and administrative 56,776 1,279 34,337 92,392 Restructuring expense 849 — 402 1,251 Impairment expense 5,241 — — 5,241 Depreciation and amortization 63,175 2,416 3,308 68,899 Total operating expenses 228,308 9,407 37,614 275,329 Operating income (loss) $ 20,707 $ 9,512 $ (38,177) $ (7,958) Capital expenditures $ 188,729 $ 620 $ 260 $ 189,609 Year ended December 31, 2021: (in thousands) Broadband Tower Corporate & Eliminations Consolidated External revenue Residential & SMB $ 177,530 $ — $ — $ 177,530 Commercial Fiber 30,842 — — 30,842 RLEC & Other 15,249 — — 15,249 Tower lease — 12,393 — 12,393 Service revenue and other 223,621 12,393 — 236,014 Revenue for service provided to the discontinued Wireless operations 4,459 5,311 (545) 9,225 Total revenue 228,080 17,704 (545) 245,239 Operating expenses Cost of services 97,283 5,438 (422) 102,299 Selling, general and administrative 47,840 1,197 33,414 82,451 Restructuring expense 202 — 1,525 1,727 Impairment expense 5,986 — — 5,986 Depreciation and amortization 47,937 2,053 5,216 55,206 Total operating expenses 199,248 8,688 39,733 247,669 Operating income (loss) $ 28,832 $ 9,016 $ (40,278) $ (2,430) Capital expenditures $ 156,131 $ 977 $ 2,993 $ 160,101 Year ended December 31, 2020: (in thousands) Broadband Tower Corporate & Eliminations Consolidated External revenue Residential & SMB $ 154,956 $ — $ — $ 154,956 Commercial Fiber 24,431 — — 24,431 RLEC & Other 15,971 — — 15,971 Tower lease — 7,402 — 7,402 Service revenue and other 195,358 7,402 — 202,760 Revenue for service provided to the discontinued Wireless operations 8,989 9,653 (627) 18,015 Total revenue 204,347 17,055 (627) 220,775 Operating expenses Cost of services 84,893 4,896 (132) 89,657 Selling, general and administrative 39,472 1,430 44,114 85,016 Depreciation and amortization 41,076 1,906 5,721 48,703 Total operating expenses 165,441 8,232 49,703 223,376 Operating income (loss) $ 38,906 $ 8,823 $ (50,330) $ (2,601) Capital expenditures $ 117,246 $ 2,001 $ 1,203 $ 120,450 |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | A reconciliation of the total of the reportable segments’ operating (loss) income to consolidated (loss) income from continuing operations before income taxes is as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Total consolidated operating loss $ (7,958) $ (2,430) $ (2,601) Other (expense) income, net (1,348) 8,665 3,187 (Loss) income from continuing operations before income taxes $ (9,306) $ 6,235 $ 586 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | Income from discontinued operations, net of tax in the consolidated statements of comprehensive income consist of the following for the years ended December 31, 2021 and 2020: (in thousands) Revenue: 2021 2020 Service revenue and other $ 201,076 $ 401,035 Equipment revenue 12,253 41,338 Total revenue 213,329 442,373 Operating expenses: Cost of services 38,144 116,394 Cost of goods sold 11,964 40,642 Selling, general and administrative 17,514 34,011 Severance expense 465 — Depreciation and amortization — 62,930 Total operating expenses 68,087 253,977 Operating income 145,242 188,396 Other (expense) income: Debt extinguishment (11,032) — Interest expense and other, net (9,178) (20,455) Gain on sale of disposition of Wireless assets and operations 1,227,531 — Income before income taxes 1,352,563 167,941 Income tax expense 361,661 43,844 Income from discontinued operations, net of tax $ 990,902 $ 124,097 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||
Advertising expense | $ 6,800 | $ 4,400 | $ 2,700 |
Fair value of projected benefit obligations | $ 3,758 | 8,216 | |
Number of operating segments | segment | 2 | ||
Number of reportable segments | segment | 2 | ||
Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets, useful life | 10 years | ||
Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets, useful life | 15 years | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |||
Finite-Lived Intangible Assets [Line Items] | |||
Performance obligation period | 1 year | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |||
Finite-Lived Intangible Assets [Line Items] | |||
Performance obligation period | 1 year | ||
Pension Plan | |||
Finite-Lived Intangible Assets [Line Items] | |||
Fair value of projected benefit obligations | $ 0 | 2,393 | |
Net benefit plan obligation | 3,400 | ||
Ntelos Holding, Corp | Pension Plan | |||
Finite-Lived Intangible Assets [Line Items] | |||
Fair value of pension plan assets | 21,300 | 31,100 | |
Fair value of projected benefit obligations | $ 24,700 | $ 33,500 | |
Discount rate (as a percent) | 4.90% | 2.74% | |
Ntelos Pension Plan | |||
Finite-Lived Intangible Assets [Line Items] | |||
Pension benefits, vesting period | 5 years | ||
Vesting reductions, threshold age of recipient | 65 years | ||
Postretirement medical benefits plan | |||
Finite-Lived Intangible Assets [Line Items] | |||
Fair value of projected benefit obligations | $ 1,869 | $ 3,506 | |
Discount rate (as a percent) | 5% | 2.70% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Benefit Obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of projected benefit obligations | $ 3,758 | $ 8,216 |
Postretirement medical benefits plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of projected benefit obligations | 1,869 | 3,506 |
Supplemental executive retirement plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of projected benefit obligations | 1,889 | 2,317 |
Pension plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of projected benefit obligations | $ 0 | $ 2,393 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | ||
Weighted average benefit period | 6 years | |
Advanced billings and customer deposits | $ 12,425 | $ 11,128 |
Non-current contract liability | $ 18,679 | $ 19,749 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Amortized and Capitalized Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Capitalized Contract Cost [Roll Forward] | ||
Beginning Balance | $ 8,147 | $ 7,358 |
Commission payments | 3,355 | 3,229 |
Contract asset amortization | (2,856) | (2,440) |
Ending Balance | $ 8,646 | $ 8,147 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Future Performance Obligation (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 9,500 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 1,900 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation period | 1 year |
Investments - Other Investments
Investments - Other Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Investments [Abstract] | ||
SERP investments at fair value | $ 1,889 | $ 2,317 |
Cost method investments | 10,749 | 11,004 |
Equity method investments | 333 | 340 |
Total investments | $ 12,971 | $ 13,661 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | |||
SERP investments, current | $ 0 | $ 801,000 | |
SERP investments at fair value | 1,889,000 | 2,317,000 | |
CoBank | |||
Schedule of Equity Method Investments [Line Items] | |||
SERP investments at fair value | 10,000,000 | 10,300,000 | |
Other nonoperating income (expense) | $ 70,700 | 2,000,000 | $ 4,200,000 |
Percentage of patronage credit paid in cash | 75% | ||
Percentage of patronage credit paid in share | 25% | ||
Valley Network Partnership | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest, percentage | 20% | ||
Equity Method Investee | |||
Schedule of Equity Method Investments [Line Items] | |||
Revenue from related parties | $ 700,000 | 700,000 | 900,000 |
Related party costs | $ 100,000 | $ 1,200,000 | $ 2,700,000 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 1,156,318 | $ 1,028,233 |
Less: accumulated depreciation and amortization | (468,765) | (474,071) |
Property, plant and equipment, net | 687,553 | 554,162 |
Land | ||
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 3,722 | 3,771 |
Land improvements | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 10 years | |
Total property, plant and equipment | $ 3,483 | 3,478 |
Buildings and structures | ||
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 93,461 | 96,323 |
Buildings and structures | Minimum | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 10 years | |
Buildings and structures | Maximum | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 45 years | |
Cable and fiber | ||
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 593,771 | 453,405 |
Cable and fiber | Minimum | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 15 years | |
Cable and fiber | Maximum | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 30 years | |
Equipment and software | ||
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 317,347 | 391,293 |
Equipment and software | Minimum | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 4 years | |
Equipment and software | Maximum | ||
Property, plant and equipment [Abstract] | ||
Estimated useful lives | 8 years | |
Plant in service | ||
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 1,011,784 | 948,270 |
Plant under construction | ||
Property, plant and equipment [Abstract] | ||
Total property, plant and equipment | $ 144,534 | $ 79,963 |
Property, Plant and Equipment -
Property, Plant and Equipment - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Aug. 23, 2022 USD ($) | Jun. 30, 2022 USD ($) cell_site | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Property, Plant and Equipment [Line Items] | |||||
Accounts payable | $ 49,173 | $ 28,542 | |||
Depreciation | 68,175 | $ 54,389 | $ 47,964 | ||
Number of wireless sites closed | cell_site | 20 | ||||
Number of wireless sites | cell_site | 55 | ||||
Impairment of long-lived assets to be disposed of | $ 4,100 | ||||
Accelerated depreciation | 7,400 | ||||
Buildings and structures | |||||
Property, Plant and Equipment [Line Items] | |||||
Cost depreciation | 300 | ||||
Cable and fiber | |||||
Property, Plant and Equipment [Line Items] | |||||
Cost depreciation | 100 | ||||
Equipment and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Cost depreciation | 62,900 | ||||
Broadband | |||||
Property, Plant and Equipment [Line Items] | |||||
Accounts payable | $ 43,800 | ||||
Asset Purchase Agreement | |||||
Property, Plant and Equipment [Line Items] | |||||
Asset acquisition, consideration transferred | $ 21,500 | ||||
Payments to acquire productive assets | 17,700 | ||||
Asset acquisition, consideration transferred, liabilities incurred | $ 3,800 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Non-amortizing intangibles | $ 76,597 | $ 78,314 |
Gross carrying amount | 28,913 | 35,699 |
Accumulated amortization and other | (27,239) | (27,426) |
Total | 1,674 | 8,273 |
Total intangible assets, gross carrying amount | 108,754 | 117,257 |
Intangible assets, net | 81,515 | 89,831 |
Broadband | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill, gross | 3,244 | 3,244 |
Goodwill | 3,244 | 3,244 |
FCC spectrum licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 0 | 6,811 |
Accumulated amortization and other | 0 | (672) |
Total | 0 | 6,139 |
Subscriber relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 28,425 | 28,425 |
Accumulated amortization and other | (26,910) | (26,451) |
Total | 1,515 | 1,974 |
Other intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 488 | 463 |
Accumulated amortization and other | (329) | (303) |
Total | 159 | 160 |
Cable franchise rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Non-amortizing intangibles | 64,334 | 64,334 |
FCC spectrum licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Non-amortizing intangibles | 12,122 | 13,839 |
Railroad crossing rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Non-amortizing intangibles | $ 141 | $ 141 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||
Amortization expense | $ 700 | $ 800 | $ 700 | ||
Refund received (cash disbursed) for deposit on FCC spectrum leases | $ 3,996 | 0 | $ (16,118) | ||
Spectrum Purchase Agreements | Disposal Group, Held-for-sale, Not Discontinued Operations | |||||
Business Acquisition [Line Items] | |||||
Indefinite-lived license | 13,800 | ||||
Finite-lived license | 5,900 | ||||
Operating lease liabilities | $ 3,800 | ||||
FCC spectrum licenses | |||||
Business Acquisition [Line Items] | |||||
Indefinite-lived intangible assets acquired | $ 12,100 | $ 16,100 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Estimated Useful Life (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Subscriber relationships | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (in years) | 3 years |
Subscriber relationships | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (in years) | 10 years |
Other intangibles | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (in years) | 15 years |
Other intangibles | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (in years) | 20 years |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Amortization Expense for Intangible Assets (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 | $ 489 |
2024 | 489 |
2025 | 483 |
2026 | 103 |
2027 | 65 |
Thereafter | 45 |
Total | $ 1,674 |
Other Assets and Accrued Liab_3
Other Assets and Accrued Liabilities - Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities Disclosure [Abstract] | ||
Deposit for FCC spectrum licenses | $ 0 | $ 16,118 |
Prepaid maintenance expenses | 7,444 | 8,391 |
Broadband contract acquisition costs | 2,809 | 2,502 |
SERP investments | 0 | 801 |
Other | 1,256 | 2,018 |
Prepaid expenses and other | $ 11,509 | $ 29,830 |
Other Assets and Accrued Liab_4
Other Assets and Accrued Liabilities - Long-Term Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities Disclosure [Abstract] | ||
Broadband contract acquisition costs | $ 5,837 | $ 5,645 |
Prepaid expenses and other | 7,422 | 4,653 |
Deferred charges and other assets | $ 13,259 | $ 10,298 |
Other Assets and Accrued Liab_5
Other Assets and Accrued Liabilities - Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities Disclosure [Abstract] | ||
Accrued programming costs | $ 3,306 | $ 3,084 |
Pension plan | 3,341 | 0 |
Restructuring accrual | 146 | 1,761 |
Other current liabilities | 11,113 | 9,804 |
Accrued liabilities and other | $ 17,906 | $ 14,649 |
Other Assets and Accrued Liab_6
Other Assets and Accrued Liabilities - Long Term Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities Disclosure [Abstract] | ||
Noncurrent portion of deferred revenue | $ 18,679 | $ 19,749 |
Noncurrent portion of financing leases | 1,500 | 1,614 |
FCC spectrum license obligations | 0 | 3,807 |
Other | 39 | 461 |
Other liabilities | $ 20,218 | $ 25,631 |
Finance lease, liability, noncurrent, statement of financial position [extensible enumeration] | Other liabilities | Other liabilities |
Other Assets and Accrued Liab_7
Other Assets and Accrued Liabilities - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||
Restructuring expense | $ 1,251 | $ 1,727 | $ 0 |
Workforce Reduction Program | |||
Business Acquisition [Line Items] | |||
Payments for restructuring | $ 1,700 | 2,100 | |
Workforce Reduction Program | Continuing Operations | |||
Business Acquisition [Line Items] | |||
Restructuring expense | 1,700 | ||
Workforce Reduction Program | Discontinued Operations | |||
Business Acquisition [Line Items] | |||
Restructuring expense | $ 2,200 |
Other Assets and Accrued Liab_8
Other Assets and Accrued Liabilities - Asset Removal Obligations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||
Balance at beginning of year | $ 9,824 | $ 5,113 | $ 6,152 |
Additional asset retirement obligations recorded and changes to prior estimates | 1,198 | 4,290 | (1,371) |
Liabilities settled | (185) | 0 | 0 |
Accretion expense | 531 | 421 | 332 |
Balance at end of year | $ 11,368 | $ 9,824 | $ 5,113 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating lease, weighted average remaining lease term | 20 years | ||
Operating lease, weighted average discount rate, percent | 4.50% | ||
Finance lease, weighted average remaining lease term | 13 years | ||
Finance lease, weighted average discount rate, percent | 5.20% | ||
Operating lease, cost | $ 7.6 | $ 7.1 | $ 6.6 |
Finance lease, cost | 0.6 | 0.6 | 0.6 |
Operating lease, payments | 6.1 | 5.6 | 4.4 |
Right-of-use asset obtained in exchange for operating lease liability | 2.5 | 11.1 | 6.8 |
Sublease income | $ 18.4 | $ 11.1 | $ 9.1 |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liability - Lessee (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Operating Leases | |
2023 | $ 4,987 |
2024 | 5,102 |
2025 | 4,897 |
2026 | 4,405 |
2027 | 3,634 |
2028 and thereafter | 64,443 |
Total lease payments | 87,468 |
Less: interest | (34,162) |
Present value of lease liabilities | 53,306 |
Finance Leases | |
2023 | 176 |
2024 | 178 |
2025 | 180 |
2026 | 153 |
2027 | 155 |
2028 and thereafter | 1,359 |
Total lease payments | 2,201 |
Less: interest | (604) |
Present value of lease liabilities | 1,597 |
Total | |
2023 | 5,163 |
2024 | 5,280 |
2025 | 5,077 |
2026 | 4,558 |
2027 | 3,789 |
2028 and thereafter | 65,802 |
Total lease payments | 89,669 |
Less: interest | (34,766) |
Present value of lease liabilities | $ 54,903 |
Leases - Maturity of Lease Li_2
Leases - Maturity of Lease Liability - Lessor (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
2023 | $ 15,100 |
2024 | 13,710 |
2025 | 12,791 |
2026 | 9,754 |
2027 | 8,258 |
2028 and thereafter | 21,572 |
Total | $ 81,185 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) | 9 Months Ended | 12 Months Ended | 24 Months Ended | 30 Months Ended | |||
Jul. 01, 2021 | Jun. 30, 2024 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2029 | Mar. 31, 2027 | |
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 4.39% | ||||||
Interest payments | $ 600,000 | $ 10,400,000 | $ 18,600,000 | ||||
Commitment fees | 700,000 | ||||||
Remaining borrowing capacity | $ 225,000,000 | ||||||
Term loan A-1 | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 150,000,000 | ||||||
Term of credit facility | 5 years | ||||||
Term loan A-1 | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Quarterly principal payment period one | $ 200,000 | $ 500,000 | |||||
Term loan A-1 | London Interbank Offered Rate (LIBOR) | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.50% | ||||||
Term loan A-2 | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 150,000,000 | ||||||
Term of credit facility | 7 years | ||||||
Term loan A-2 | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Quarterly principal payment period one | $ 100,000 | ||||||
Term loan A-2 | London Interbank Offered Rate (LIBOR) | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.50% | ||||||
Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 100,000,000 | ||||||
Term of credit facility | 5 years |
Debt - Credit Agreement (Detail
Debt - Credit Agreement (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Total debt | $ 75,000 | $ 0 |
Less: unamortized loan fees | (46) | 0 |
Total debt, net of unamortized loan fees | 74,954 | 0 |
Term loan A-1 | ||
Debt Instrument [Line Items] | ||
Total debt | 37,500 | 0 |
Term loan A-2 | ||
Debt Instrument [Line Items] | ||
Total debt | $ 37,500 | $ 0 |
Debt - Maturities of Long-term
Debt - Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Maturities of Long-term Debt [Abstract] | ||
2023 | $ 656 | |
2024 | 1,781 | |
2025 | 2,250 | |
2026 | 34,125 | |
2027 | 375 | |
2028 and thereafter | 35,813 | |
Total | $ 75,000 | $ 0 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | |||
Income taxes net | $ (100,000) | $ (11,200,000) | |
Proceeds from income tax refunds | $ 9,500,000 | ||
Deferred tax assets, operating loss carryforwards, state and local | 28,398,000 | 5,878,000 | |
Valuation allowance on deferred tax | 619,000 | 0 | |
Unrecognized tax benefits | 0 | $ 0 | |
Domestic Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 125,600,000 | ||
Domestic Tax Authority | Subject to Expiration After 2027 | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 97,800,000 | ||
State and Local Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | $ 40,000,000 |
Income Taxes - Components of Fe
Income Taxes - Components of Federal and State Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current expense (benefit) | |||
Federal taxes | $ 673 | $ (21,392) | $ (13,748) |
State taxes | (186) | (2,565) | (2,148) |
Total current provision | 487 | (23,957) | (15,896) |
Deferred (benefit) expense | |||
Federal taxes | (1,119) | 25,518 | 13,325 |
State taxes | (295) | (3,255) | 1,581 |
Total deferred (benefit) expense | (1,414) | 22,263 | 14,906 |
Income tax benefit | $ (927) | $ (1,694) | $ (990) |
Effective tax rate | 10% | (27.20%) | (168.90%) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
Expected tax (benefit) expense at federal statutory | $ (1,954) | $ 1,310 | $ 24 |
State income taxes, net of federal tax effect | (410) | 438 | 54 |
Revaluation of deferred tax liabilities | 0 | (5,206) | 0 |
Stranded tax effects reclassified from other comprehensive income | 0 | 1,620 | 0 |
Excess tax expense (benefit) from share based compensation and other expense, net | 818 | 144 | (1,068) |
Valuation allowance | 619 | 0 | 0 |
Income tax benefit | $ (927) | $ (1,694) | $ (990) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Leases | $ 14,809 | $ 15,483 |
Asset retirement obligations | 2,972 | 2,581 |
Net operating loss carry-forwards | 28,398 | 5,878 |
Pension liabilities | 978 | 2,148 |
Accruals and stock-based compensation | 3,087 | 2,572 |
Other | 5,767 | 6,300 |
Total gross deferred tax assets | 56,011 | 34,962 |
Less valuation allowance | (619) | 0 |
Net deferred tax assets | 55,392 | 34,962 |
Deferred tax liabilities: | ||
Property, plant and equipment | 109,852 | 92,449 |
Leases | 14,541 | 15,410 |
Intangible assets | 12,867 | 10,710 |
Prepaid assets and other | 2,732 | 2,407 |
Total gross deferred tax liabilities | 139,992 | 120,976 |
Net deferred tax liabilities | $ 84,600 | $ 86,014 |
Stock Compensation, Earnings _3
Stock Compensation, Earnings per Share, and Dividends - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||
Aug. 02, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation, nonvested awards, compensation cost not yet recognized | $ 9.2 | |||
Compensation, nonvested awards, cost not yet recognized, period for recognition | 2 years 4 months 24 days | |||
Anti-dilutive awards outstanding (fewer than) (in shares) | 365,000 | 259,000 | 30,000 | |
Special dividend (in dollars per share) | $ 18.75 | |||
Dividends payout | $ 937 | |||
The 2014 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Additional number of shares authorized for issuance (in shares) | 4,200,000 | |||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 518,000 | |||
Granted, weighted average grant price (in dollars per share) | $ 21.56 | |||
Vested (in shares) | (153,000) | |||
Vested, weighted average grant price (in dollars per share) | $ 27.50 | |||
Forfeited (in shares) | (53,000) | |||
Forfeited, weighted average grant price (in dollars per share) | $ 25.89 | |||
Fair value of RSUs vested | $ 3.3 | |||
Outstanding (in shares) | 649,000 | |||
Weighted average grant date fair value outstanding (in dollars per share) | $ 23.39 | |||
Restricted Stock Units (RSUs) | The 2014 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expiration period | 10 years | |||
Restricted Stock Units (RSUs) | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 1 year | |||
Restricted Stock Units (RSUs) | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 5 years | |||
Relative Total Shareholder Return Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 100,000 | |||
Granted, weighted average grant price (in dollars per share) | $ 23.83 | |||
Vested (in shares) | (46,000) | |||
Vested, weighted average grant price (in dollars per share) | $ 33.83 | |||
Forfeited (in shares) | (6,000) | |||
Forfeited, weighted average grant price (in dollars per share) | $ 36.28 | |||
Fair value of RSUs vested | $ 1.2 | |||
Outstanding (in shares) | 202,000 | |||
Weighted average grant date fair value outstanding (in dollars per share) | $ 29.46 | |||
Award vesting period | 3 years | |||
Anti-dilutive awards outstanding (fewer than) (in shares) | 9,000 | |||
Relative Total Shareholder Return Awards | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares issued (as a percent) | 0% | |||
Relative Total Shareholder Return Awards | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares issued (as a percent) | 150% |
Stock Compensation, Earnings _4
Stock Compensation, Earnings per Share, and Dividends - Schedule of Stock Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
Stock compensation expense | $ 9,142 | $ 3,552 | $ 6,227 |
Capitalized stock compensation | 614 | 144 | 320 |
Stock compensation expense, net | $ 8,528 | $ 3,408 | $ 5,907 |
Stock Compensation, Earnings _5
Stock Compensation, Earnings per Share, and Dividends - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
(Loss) income from continuing operations | $ (8,379) | $ 7,929 | $ 1,576 |
Total income from discontinued operations, net of tax | 0 | 990,902 | 124,097 |
Net (loss) income | $ (8,379) | $ 998,831 | $ 125,673 |
Basic weighted average shares outstanding (in shares) | 50,155 | 50,026 | 49,901 |
Basic net income per share - continuing operations (in dollars per share) | $ (0.17) | $ 0.16 | $ 0.03 |
Basic net income per share - discontinued operations (in dollars per share) | 0 | 19.81 | 2.49 |
Basic net income per share (in dollars per share) | $ (0.17) | $ 19.97 | $ 2.52 |
Effect from dilutive shares and options outstanding (in shares) | 0 | 123 | 123 |
Weighted average shares outstanding, diluted (in shares) | 50,155 | 50,149 | 50,024 |
Diluted net income per share - continuing operations (in dollars per share) | $ (0.17) | $ 0.16 | $ 0.03 |
Diluted net income per share - discontinued operations (in dollars per share) | 0 | 19.76 | 2.48 |
Diluted net income per share (in dollars per share) | $ (0.17) | $ 19.92 | $ 2.51 |
Government Grants (Details)
Government Grants (Details) $ in Thousands | Dec. 31, 2021 USD ($) |
Government Grants [Line Items] | |
Total | $ 71,354 |
VIRGINIA | VATI | |
Government Grants [Line Items] | |
Total | 58,918 |
VIRGINIA | RDOF | |
Government Grants [Line Items] | |
Total | 887 |
MARYLAND | Connect MD | |
Government Grants [Line Items] | |
Total | 10,200 |
WEST VIRGINIA | MBPS | |
Government Grants [Line Items] | |
Total | $ 1,349 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Marketing Services and IT Softeware Licences | |||
Other Commitments [Line Items] | |||
Payments for long-term purchase commitment | $ 5.2 | $ 3.4 | $ 1.4 |
Commitments and Contingencies_2
Commitments and Contingencies - Purchase Commitments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Purchase Commitments | |
2023 | $ 4,684 |
2024 | 3,267 |
2025 | 1,993 |
2026 | 1,044 |
2027 | 609 |
2028 and thereafter | 109 |
Total | $ 11,706 |
Segment Reporting - Selected Fi
Segment Reporting - Selected Financial Data for Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
External revenue | |||
Service revenue and other | $ 267,371 | $ 245,239 | $ 220,775 |
Operating expenses | |||
Cost of services exclusive of depreciation and amortization | 107,546 | 102,299 | 89,657 |
Selling, general and administrative | 92,392 | 82,451 | 85,016 |
Restructuring expense | 1,251 | 1,727 | 0 |
Impairment expense | 5,241 | 5,986 | 0 |
Depreciation and amortization | 68,899 | 55,206 | 48,703 |
Operating loss | (7,958) | (2,430) | (2,601) |
Capital expenditures | 189,609 | 160,101 | 120,450 |
Operating Segments | |||
Operating expenses | |||
Selling, general and administrative | 92,392 | 82,451 | 85,016 |
Restructuring expense | 1,251 | 1,727 | |
Impairment expense | 5,241 | 5,986 | |
Depreciation and amortization | 68,899 | 55,206 | 48,703 |
Total operating expenses | 275,329 | 247,669 | 223,376 |
Operating loss | (7,958) | (2,430) | (2,601) |
Capital expenditures | 189,609 | 160,101 | 120,450 |
Operating Segments | Broadband | |||
External revenue | |||
Service revenue and other | 249,015 | 228,080 | 204,347 |
Operating expenses | |||
Selling, general and administrative | 56,776 | 47,840 | 39,472 |
Restructuring expense | 849 | 202 | |
Impairment expense | 5,241 | 5,986 | |
Depreciation and amortization | 63,175 | 47,937 | 41,076 |
Total operating expenses | 228,308 | 199,248 | 165,441 |
Operating loss | 20,707 | 28,832 | 38,906 |
Capital expenditures | 188,729 | 156,131 | 117,246 |
Operating Segments | Tower | |||
External revenue | |||
Service revenue and other | 18,919 | 17,704 | 17,055 |
Operating expenses | |||
Selling, general and administrative | 1,279 | 1,197 | 1,430 |
Restructuring expense | 0 | 0 | |
Impairment expense | 0 | 0 | |
Depreciation and amortization | 2,416 | 2,053 | 1,906 |
Total operating expenses | 9,407 | 8,688 | 8,232 |
Operating loss | 9,512 | 9,016 | 8,823 |
Capital expenditures | 620 | 977 | 2,001 |
Intersegment Eliminations | |||
External revenue | |||
Service revenue and other | 0 | 9,225 | 18,015 |
Intersegment Eliminations | Broadband | |||
External revenue | |||
Service revenue and other | 185 | 4,459 | 8,989 |
Intersegment Eliminations | Tower | |||
External revenue | |||
Service revenue and other | 378 | 5,311 | 9,653 |
Intersegment Eliminations | Corporate & Eliminations | |||
External revenue | |||
Service revenue and other | (563) | (545) | (627) |
Corporate, Non-Segment | |||
Operating expenses | |||
Selling, general and administrative | 34,337 | 33,414 | 44,114 |
Restructuring expense | 402 | 1,525 | |
Impairment expense | 0 | 0 | |
Depreciation and amortization | 3,308 | 5,216 | 5,721 |
Total operating expenses | 37,614 | 39,733 | 49,703 |
Operating loss | (38,177) | (40,278) | (50,330) |
Capital expenditures | 260 | 2,993 | 1,203 |
Residential & SMB | Operating Segments | |||
External revenue | |||
Service revenue and other | 193,974 | 177,530 | 154,956 |
Residential & SMB | Operating Segments | Broadband | |||
External revenue | |||
Service revenue and other | 193,974 | 177,530 | 154,956 |
Residential & SMB | Operating Segments | Tower | |||
External revenue | |||
Service revenue and other | 0 | 0 | 0 |
Commercial Fiber | Operating Segments | |||
External revenue | |||
Service revenue and other | 38,821 | 30,842 | 24,431 |
Commercial Fiber | Operating Segments | Broadband | |||
External revenue | |||
Service revenue and other | 38,821 | 30,842 | 24,431 |
Commercial Fiber | Operating Segments | Tower | |||
External revenue | |||
Service revenue and other | 0 | 0 | 0 |
RLEC & Other | Operating Segments | |||
External revenue | |||
Service revenue and other | 16,035 | 15,249 | 15,971 |
RLEC & Other | Operating Segments | Broadband | |||
External revenue | |||
Service revenue and other | 16,035 | 15,249 | 15,971 |
RLEC & Other | Operating Segments | Tower | |||
External revenue | |||
Service revenue and other | 0 | 0 | 0 |
Tower lease | Operating Segments | |||
External revenue | |||
Service revenue and other | 18,541 | 12,393 | 7,402 |
Tower lease | Operating Segments | Broadband | |||
External revenue | |||
Service revenue and other | 0 | 0 | 0 |
Tower lease | Operating Segments | Tower | |||
External revenue | |||
Service revenue and other | 18,541 | 12,393 | 7,402 |
Service revenue and other | Operating Segments | |||
External revenue | |||
Service revenue and other | 267,371 | 236,014 | 202,760 |
Service revenue and other | Operating Segments | Broadband | |||
External revenue | |||
Service revenue and other | 248,830 | 223,621 | 195,358 |
Service revenue and other | Operating Segments | Tower | |||
External revenue | |||
Service revenue and other | 18,541 | 12,393 | 7,402 |
Cost of services | Operating Segments | |||
Operating expenses | |||
Cost of services exclusive of depreciation and amortization | 107,546 | 102,299 | 89,657 |
Cost of services | Operating Segments | Broadband | |||
Operating expenses | |||
Cost of services exclusive of depreciation and amortization | 102,267 | 97,283 | 84,893 |
Cost of services | Operating Segments | Tower | |||
Operating expenses | |||
Cost of services exclusive of depreciation and amortization | 5,712 | 5,438 | 4,896 |
Cost of services | Corporate, Non-Segment | |||
Operating expenses | |||
Cost of services exclusive of depreciation and amortization | $ (433) | $ (422) | $ (132) |
Segment Reporting - Reconciliat
Segment Reporting - Reconciliation of Operating Profit (Loss) from Segments to Consolidated (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of income from continuing operations from segments to consolidated [Abstract] | |||
Total consolidated operating loss | $ (7,958) | $ (2,430) | $ (2,601) |
Other (expense) income, net | (1,348) | 8,665 | 3,187 |
(Loss) income from continuing operations before income taxes | $ (9,306) | $ 6,235 | $ 586 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) $ in Millions | Jul. 01, 2021 USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Waived management fees | $ 60 |
Discontinued Operations, Held-for-sale | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Sale proceeds | $ 1,940 |
Discontinued Operations - Incom
Discontinued Operations - Income (Loss) From Discontinued Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Discontinued Operations, Held-for-sale | ||
Revenue: | ||
Revenue | $ 213,329 | $ 442,373 |
Operating expenses | ||
Selling, general and administrative | 17,514 | 34,011 |
Severance expense | 465 | 0 |
Depreciation and amortization | 0 | 62,930 |
Total operating expenses | 68,087 | 253,977 |
Operating income | 145,242 | 188,396 |
Other (expense) income: | ||
Debt extinguishment | (11,032) | 0 |
Interest expense and other, net | (9,178) | (20,455) |
Income before income taxes | 1,352,563 | 167,941 |
Income tax expense | 361,661 | 43,844 |
Income from discontinued operations, net of tax | 990,902 | 124,097 |
Discontinued Operations, Held-for-sale | Service revenue and other | ||
Revenue: | ||
Revenue | 201,076 | 401,035 |
Discontinued Operations, Held-for-sale | Equipment revenue | ||
Revenue: | ||
Revenue | 12,253 | 41,338 |
Discontinued Operations, Held-for-sale | Cost of services | ||
Operating expenses | ||
Cost of services and cost of goods sold | 38,144 | 116,394 |
Discontinued Operations, Held-for-sale | Cost of goods sold | ||
Operating expenses | ||
Cost of services and cost of goods sold | 11,964 | 40,642 |
Discontinued Operations, Disposed of by Sale | ||
Other (expense) income: | ||
Gain on sale of disposition of Wireless assets and operations | $ 1,227,531 | $ 0 |
Schedule II Valuation and Qua_2
Schedule II Valuation and Qualifying Accounts and Reserves (Details) - SEC Schedule, 12-09, Allowance, Credit Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Year | $ 352 | $ 614 | $ 533 |
Recoveries added to allowance | 414 | 530 | 758 |
Bad debt expense | 1,972 | 1,028 | 1,220 |
Write-offs | (1,962) | (1,820) | (1,897) |
Balance at End of Year | $ 776 | $ 352 | $ 614 |