CNSL - Earnings call transcript Q2 2019 | Consolidated Communications Holdings, Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to the Consolidated Communications Holdings, Inc.

Second Quarter 2019 Results Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded.

to call like host, to now Mrs. would turn over the your I and Investor President Hood, Vice Lisa Treasurer of Relations. Please go ahead.

Lisa Hood

Thank Communications' earnings everyone. today you, We appreciate you morning, and joining for second call. Consolidated XXXX quarter good us

in On press After and Steve Executive SEC President Bob the our Chief questions. remarks, prepared harbor with release we the in Financial the Officer; safe Officer. Please call me for call Chief are Udell, today Childers, and our and our will provisions filings. open review

Today's statements results expected and certain include events that website. the factors results future are discussion measures. with financial which risks non-GAAP filings future that SEC, A our discussions Today's to is are about discussion include Consolidated's on and contained may affect will forward-looking financial and uncertainties. in of subject available

been their our of of Our on earnings website these GAAP includes release nearest measures equivalent. It at has Relations the reconciliations Investor section to posted Consolidated.com.

With to that, I will over Udell. Bob turn the call

Robert Udell

you Lisa. earnings morning, Thanks, Good for and joining call. second quarter Communications' Consolidated thank

capital our review with on now Before that cash quarter, plan. X will operating the in I to financial are quarter to our of positioned paid payment over and XXXX, free results flow everyone now under new and per utilize the We quarter we start remind of final of the million dividend operating third are allocation May we $XX delever.

X% with data carrier recent just anticipate discuss our was in revenues. Now we and and for growth transport quarter in both Beginning with the X% full-year the commercial quarter-over-quarter transport. The I will over growth year-over-year and a finishing we data increase our results. second and experienced channels, quarter, and rate

data applications multi-product market, commercial often include our In voice solutions. and

suite, allows to advanced including our sales services, and consultative and approach, with compete win us customers. ethernet commercial cloud-based new along product Our

healthcare financial opportunity to industries. the and continue We see within

voice, their Maine, one Recently, one banks, Wi-Fi locations. solutions across in we and provide two by chosen security to Illinois and all their network, were in data of different local

mid-market While these these don’t our services same are wish to healthcare essential small- to throughout services and footprint. true out trend own. is support be financial build on medium-sized their providers to The most customers also small to proving of institutions, and

customer their added small sales resources services our voice In BusinessOne data we channels pricing. acquisition bundle. options gives group, to SMB and retention our and our have product for flexibility in at BusinessOne businesses competitive promote

customers We early business and have churn. acquire seen as on success we reducing new focus

strong continues channel in XXXX. results carrier to Our experience

wire wholesale, the ethernet, As result in for for see regional Internet services local access as larger demand well and as of prior continued dedicated a quarter, we our scale. as

leverage other continue to our fiber connectivity in carriers to markets. who end XX,XXX-mile network for users We need our

connections of a under quarter X% with to record tower sales. of increased reaching new contract This X,XXX connections. tower or as high Total XXXX, second a X%, increase compared by tower quarter the the XXX, is new second sequential in

existing team carrier has for upgrades bandwidth also tower XXX Our connections. contracted

revenue second and total both year-to-date a year-over-year. quota As and exceeded forecasts, revenue billed full sales result, quarter and sales

contract Oklahoma a $X.X in contract a consisting IP with of for won team Our network eight value a locations total healthcare long-term million. of

We XX serving locations retailer. carrier England connectivity for to also contract New a to secured a Northern provide national a

these utilize our We enabling regional who our examples. the to national to have carriers see accounts as of network, continue benefits fiber network by other proven

quarter, on you to having highlights. really I'm In channel our update our excited carrier a addition consumer great to channel

in business, improvements Northern the by seeing and encouraged New legacy the the in ongoing are markets in performance are England. including we We signs positive consumer

rates CCI X% next-generation units a TV part week, Packaged last triple-play in attachment from up we customer new as and broadband grown churn. two of stuff. is Data a This and launched This broadband is England. Northern reduce cool have for revenue consecutive product bundle, than video quarters, New will year. improve more

cloud-based replay and a any rewind high-demand option. as features service national such remote controls content and and local anywhere has includes It's voice-activated an channels at XXX cloud-based TV. time, of DVR as and content delivers The for viewing

in step Northern in delivering strategy at without to right set-top England first grow transforming a improve TV right our customer requirement and the box dedicated by and is England builds time New our Northern a revenue the work go-to-market and It's CCI installation. for the service consumer upon experience. the video in product New

delivery $X are service to over annualized and center in speed in happening These improvements our intervals, that of network. accomplished of additional advantage significant re-engineering capabilities across savings. taking while improvements in wait steps were installation call our on-time resulted other million These service process in arrivals, critical the The times. generating has are were increase

continue base New larger wallet We to to share our broadband appealing with on a playbook execute The grow by and ability connectivity television revenue superior product TV enhances in grew a Northern England consumer of faster speed. CCI portfolio broadband addition to service. expand and to our and drive customers the of our

Finally, we invested capital second the during quarter. in million $XX expenditures

the non-recurring the increases majority with restoral associated projects. seasonal includes expenditures, the roughly costs for capital and wrapping up to integration-related quarter our construction $XX Michael property with associated with period, addition Florida Hurricane In normal in million in

$XXX guidance to $XXX our still expenditures million. our of We are projecting million to be full-year within capital

financial review. now turn the for Steve? Steve will call I the over

Steven Childers

XXXX and discuss for properties, Thank compared good quarter. also revenue provide for and our the second I'll guidance second X.X% ILEC After second full-year the year, sell to quarter of last results updated the declined revenues everyone. $XXX.X the to of morning Today, financial I Operating our for for were quarter will quarter Virginia normalizing XXXX. the as Bob, million.

quarter. the declined driven services. associated I'll in $X.X commercial of lines decrease million. $XX.X quarter, revenue total and the revenue from carrier discuss for X.X% and or Revenue declined voice our by totaled million the access and channels. each Now services customer $X.X In Data X.X% grew traditional transport and continued million

million, of per quarter. equipment structured primarily second quarter, with normalized the any any and is did we cabling, Consumer accounted decline. from TV QX revenue around it for is this which revenues was run strategy. in and or trend pre-CCI million XXXX. line did consistent Video of $X.X revenues million down in we revenue, QX revenue other our in with not declined million $X.X recognize $X.X large $XX was In Voice and XXXX Additionally, X.X%. rate projects our as

quarter, broadband million, revenue consumer the For grew or X.X%. $X.X

ARPU execute the reducing sales on We as of with continue churn. increasing positively growth and and faster speeds, to our updates driving revenue strategy speed impacting are network

were that XXXX. August occurred million, Subsidy impact transitional of $X.X support step-down by the in revenues final in down II driven CAF the

per of remainder subsidy XXXX. We the expect quarter $XX revenue of million for approximately

or $X.X revenues million, X.X%. access Network declined

The Before comments like speculation is comment initial vote transition II the would of revenue on I Digital notice on discussion, from Rural CAF leaving the on recent of to Opportunity be design. impact rulemaking their Fund. to about the seeking today proposed will scheduled FCC to and the

bid to be active census advantage do This have allows the option plan versus in II markets. network CAF process, selective rural we confident required the option that we state. process infrastructure process give are who First, in us an over the us in the these don't blocks competitive entire and on a be relation we fiber-rich consider, those will participant to will our to

agile area, existing within funding we the our as evaluating be will well as service where exchanges have We network. fiber

order transitional seventh questions, FCC The do of CAF how through XXXX important FCC other related the on the about carriers' acceptance it and transitional to of year talks particularly funding. funding, comment so. numerous on II receiving the Second, us a based funding seeks should asked

with CAF Opportunity estimated Rural II, is funding Digital overall XX-year than $XX.X be Fund larger The a billion over period. to

Consolidated, for fund as this We are commitment the rural to the are growth. excited drive objectives with opportunities our consistent about of broadband

million compared million year, $XXX.X the $XX.X of quarter for operating Now initiatives. amortization, result operating with lower $XXX.X cost of an to of depreciation salaries expenses, and benefits optimization or to exclusive and million, turning services in improvement. and driven by as headcount various reductions of last cost declined and expenses, savings products network a X.X%, associated second Cost were $X.X million,

audit expense synergy one-time were the Windstream our We efficiencies. of costs to a we with reductions $X.X during headcount reserve few and a gross improved as overall our SG&A $XXX,XXX and reserve accrual believe we realize adequate. debt a total increased bad of tax our operational is $XXX,XXX, by receipt items. by settlement million associated Offsetting $XXX,XXX, and also quarter multi-year bankruptcy Pennsylvania the for continue increased we

of the roughly we by At the end have two-year million. $X FairPoint second exceeded $XX of our quarter, synergy million target

last against our this initiatives we time savings we specific to prior As will agreement the opportunities. report But, as integration acquisition two-year the is expense with add-back and window cost improvement will now for is under credit identify acquisitions, synergies. continue closed,

to due debt for million $XX.X of last distributions Net was compared period prior partnerships $XX.X X.X%. our was interest primarily wireless was change second Cash million were June $XX.X average increases. the for expense weighted the million, XX, year. compared $XX.X for approximately year. quarter company's same And the in quarter, at The million the to to LIBOR from the cost

the of Adjusted by previously net EBITDA due to as $X.XX per prior non-recurring loss year. projects, spent a as earlier. to CapEx for totaled offset second diluted the year, compared $XXX.X a quarter $X.XX, revenue as in savings, last the second negative result compared million was million in Bob the In $XX.X million but discussed primarily $XXX.X was share discussed. declines on to quarter, expense Adjusted

availability under was approximately our cash million. including and Total liquidity, $XX on revolver, hand

total leverage our was ratio quarter, For the X.XXx. net second

of April interest our As and payment the our quarter, also did semi-annual make X, we had final dividend X. bond May on we second payment on

committed improving of our our behind With new the we now executing focused payment dividend policy, and deleveraging, is are balance to on allocation capital. capital sheet which us, cost

the down As dividend to our all $XX XXXX debt. or repurposed be the million, QX call, we full on will said paying savings,

structure will strategy, we accelerate will debt of refinancing Xx leverage mid-XXXX the no than improve the are With goal the With shortest later getting for debt we the cost taking of we with our maturity. below our as unsecured this of debt. advance paydown, target capital our debt out confident deleveraging in opportunistically highest we

to capital are will allocation $XXX $XXX And $XXX million unchanged are part less million we full-year to to million. to policy, Cash still in taxes be of of adjusted enhancing be in capital expected range be $X to for the be EBITDA, in expect interest million. than XXXX. and the guidance expected $XXX cash we include As to is for the range the of range costs expenditures million. is million which $XXX of are income to expecting $XXX new Guidance we million

for the now Bob With that, closing over call I'll remarks. to back turn

Robert Udell

we our Thank closing, you, well confident to and have business value as the we bring in as position regions the we customers the we competitive are serve. Steve. In our in

experience. to as expand plan and to future, allocation look As capital new broadband results our focused customer further we improve delivering service and on work the we are the clearly we

now we'll Christina, take questions. that, With

Operator

from James. [Operator comes Instructions] Louthan Frank Our first from question Raymond line the of

Frank Louthan

Thank you. Great.

just other comfortable on last of that So of you have? quick especially Virginia One, other things. next as properties with year. consider sold a you years? the more fairly some few question you properties looking two property delever Any you're to there rationalizing, disparate – you over sort the might the Are any footprint are

secondly, of makeup I of of of full then, metric Thanks. percentage I is. and breakdown, to in your idea for the what plants copper and to makeup coax is have the sort wanted And megs much that want get the if copper? has you can or of What give another on an sense company If an the just of you us XXX on the ILEC. and over a on fiber idea plant get that, and like the how

Steven Childers

Steve. second address the Bob your Frank, and part. take the question, of part is I'll this can first

It in quarter, in the quarter, only also of respect with poles. sold evaluate question in the utility sales, have of in type to but transaction, operations the you of but to $XX those really one sort to of we continuing a about poles looking monetize of day to million not pole to company looking literally did New proceeds we're last actually northern England. if support transaction So improve some potential will, where the that your we of asset some about cash closed assets,

the on in we properties. broader of assets question some other portfolio, FairPoint we of legacy your properties, have inquiries looking on To are at the some – our really

Enventis was Just to equipment you, past it have our acquisition. of we and in the the sold business, part remind

sold our Iowa have We ILEC.

have sold ILEC. Virginia We our

over evaluation based willing based just valuation, consider about So we on those to to – we'll are so continue consideration talk time.

Robert Udell

And changing we're it's related making investments. a constantly plant, to update the because mix,

penetrations, product, within you our but and at speed it's see up If across keep what compete and we and based look see speed. – XX-meg a we and We our upgrade accessible it network on way effectively is effort with look utilization can the that a we XX% customers. to can is available raising constant from

our to So across and growing each property, and base, X-gig get the connect to customer we range roughly loop can can we XX-meg the we're incremental XX%, basis that's we quarter an XX% of XX% more combined our lengths. shorten in get XX-meg on as

look this our within targeted feel in to see opportunity, envelope did upgrades to build the capital that's structure. capital roughly confident the ample month we we with currently ability subs it, to So to video we that the and way last launch the to product the enough million keep XXX,XXX and starting continue in in a Portland, sufficient penetration New network we Northern England, allocate at within year, over that upgrading our

Frank Louthan

a Steve, an the could on that stay And, bucket of or there you. number, of back that there sell, is you assets just Thank great. fall amount potentially kind that asset you a tuned? could is – rationalization, Okay, into have

Steven Childers

stay based would tuned. I so. It's all on valuations, situational

Frank Louthan

All great. you much. very Okay. right, Thank

Operator

comes from of line question Wells from next Fargo. Davis the Hebert Our

Davis Hebert

the for taking morning, questions. everyone. Good Thanks

few to ask into about, customer upgrade? new six months FairPoint a that the would footprint. home recent How months guess I wanted XXX,XXX more or now that is acquisition on say you I going – First, your follow-up we're

Robert Udell

the and process if To factors upgrades, New incredibly installation renegotiations up gating put really not but will, the re-engineering opened August brought the last pipeline it then benefits well. by across been and bluntly, only were network it's you in England, contract Northern positive. the that The

interested doing available. We the We're to efficiency – for get the that digital on market. in letting techs getting door much lot actually build service across we're marketing acquisitions and very are how the initially service is did when both direct getting more know marketing getting so the and now XXX,XXX of and and The mail, do now the and hangers helping upgrades between we blitz by a with smarter effective. neighbors volume, neighborhood-specific installs is we the

all and say So hoped we of I what momentum well boost seasonality, could seeing here that above once we're third into time the turned would those we see quarter. we always while continue from have process we on, a we're this had year improvements

Davis Hebert

would acquisition, the as demanding? I'm this you have Great. TV the went something one Thanks for proprietary And a customers that. these pursuing be of then through advantage a new initiative. what for CCI customer in versus TV platform YouTube that And become that on the engine, having partnering process of with were virtual example? that initiative, wondering thought like providers growth is just

Robert Udell

that each inclusive Well, packages content know content, work. it of need we our interest be of we the them. local what and in that done group are to We've focus markets

set-top is simple helps a us costs this a of box out more So really and into platform that install. the evolve deployment

that hasn't that content but costs the have what been the And and just it of us the a broadband, set-top to the is extends as operate. business, be payback install, and attractive, box. to part seen a always the we to bottom risen, triple-play in for that's motivation so line for complete then want for digest But to easier is on triple-play customer the have is have and we pull-through

some an on TV, our operating that flexibility not our architecture, using off the have our It environment a open is more your content more to to get digest those that own proprietary triple-play a in by positioning in lean-back program. way is items it based over-the-top we're it the necessary gives to so embrace be the to of traditional them and what and across Netflix other linear platform Android It's own smart that scared TV it can TV. and is as or still but it not want MobiTV, and of

So because and haven't ease add installation them had of remote folks and take environment, controls, this England feel, give previously. linear install, there them really is New a new capital-intensive same is we from to process. I this TV to of market, to a well-positioned that Northern the migrate And lower product a kind same will video then look

on So environment, our positive to that area pressure under we pressure it’s look penetration as upgrade fiber forward growth think in building upward broadband helps net where assets. we another – penetrated we in more which

Davis Hebert

And, that, you Bob, to would is in where on follow-up currently just footprint? FairPoint your say penetration the

Robert Udell

opportunity It's higher only of so really a things some low a the penetration last the attention in consumer rural to frankly, XX-meg where we're XX% including penetration, the ton enroll in where XX%, it's but, in the this XX%, roadblocks of that fixed teens, to in with are quite the in we've been improvement, year we're all where or work. a the range. hard process base, product operating the paid There area XX.X%, seeing now finally all and were benefits and that we've and areas

Davis Hebert

last And for Great. question Thank you. me. then one

look As on years, the a your the balance partnerships something you higher-valuation at that of discount, a the Just you you. it like next or that? talk at market in thought of for Is wireless way Thank asset? you can could a couple can ways about sell be as your maybe over couple hurdles you the repurchases sheet accelerate might leverage reduction? a open bond what process to focus

Robert Udell

Steve?

Steven Childers

Davis. Thanks,

the bottom last half that savings $XX year yes, the be directly But repurchase, going will we and the deleveraging, accelerated EBITDA number our I it hit going for execute the into against our incumbent is and plan on year be I to of will reduction. upon question the On against XXXX. question mean, guidance one dividend business your for think about and us this million

the of market against of We'll our going highest purchases. notes for senior in that open return prioritize use best cash, the for

but potential get but an think valuation your I it you to $XX To we'll in there. probably extremely we and going no low $XX million that for can with – of if pretty we what a considering done a against depends get operating expense again, question that's asset. putt million, availability, on flow the tax mean, see us have on the with the wireless, we question So, about year market appreciate in the cash dynamics I respect base that long it, historical

invest today if we to talk it, but talk them, It's flow our enjoy business probably help happy the to about us to to and somebody cash accelerate have deleveraging. – we'd we really wants the be that in

Robert Udell

gives around XG the markets it us expansion what in we've plans insights investment interest had great and which back-haul for obtaining are the opportunities. the in And the in

Davis Hebert

Thank you Great. much. very

Operator

Our comes Company. the from Jon Cowen next question line Charbonneau of from &

Jonathan Charbonneau

Thanks taking for the questions. Great.

be solid this Within broadband the then this to year? declines you. year-over-year of and saw over quarter. year-over-year saw growth pretty for revenues video sustainable Is consistent of second X%. there the the growth voice would consumer half few Thank quarters? business of improvement Any versus you in next level believe reason last And

Robert Udell

QX revenue, but think for potential comparisons. that it high for Jon, I New some this that I the would We the a so seeing see a watermark England's better Northern question. typically will the overall Yes, than do of year, bit year-over-year past and thanks seasonality consumer is rate on be we're in run believe

in a I've both questions, answers good feel we video the position, product. we're the now like upgrades, the process, launching stated to and previous with the So network in as

with pretty to question, a what from declines, perspective. budgetary related consistent that's expected of second The your part we've video

support viewpoint, a with You CapEx have product and we're takes to where we order that the product. deeper flow balancing get the cash look it video we penetrations it need from to broadband to at in realize that

properties time, CapEx intensity. our And reallocation over and see management that capital avoidance of capital this has back long-term the XXXX, new proven of looking the be our our of our to us, years strategy, through migrate but cash video just the return platform for and change to so beneficial you'll legacy video three to and

Jonathan Charbonneau

Great. Thank you.

Operator

Jason Sachs. from Our from the comes next question Goldman Kim

Unidentified Analyst

the Jason Thanks for [Ashley questions. for taking Hi. This is Kim. on Kanasin]

was you unsecured looks you're said I million purchases your just call how one, the to as you about first a wondering targeting of as the potentially were priority on attractive. if for previously, it debt into prices we guys about tapping during bonds back think my and more fund know bond you I and you For should bonds revolver like reduction. thought bought quarter, $X the

Robert Udell

question, good Ashley. That's a

as you cash in going But, the to build up I we be to give revolver, tap cash. targeting to we as the going to, and comfortable much think million debt, do to again, how going be balanced into will looking so going going to using I be to in build the half think will much is the we're of be be behind on revolver, it. can. we in but won't are we we we'll manage go CapEx building debt us, be and we have cash, hopefully guidance position cash $XX have will think of But against post-dividend, for we we where I'm obviously, as needed to a that – repayment, liquidity integration spike there. for we're build that so QX, if probably we we'd I are as to not we we

Unidentified Analyst

structure your ability right-size heading do side Great. And cost realizing the more do to you to about great synergy into of opportunities see done of should the out a you extract guys you exceeding and of what the to type And see we XXXX? FairPoint think merger have continue costs How your target. then job like business?

Robert Udell

together and into gain that the a it's call of intelligence even think not components our artificial to some I as We're bring so I always here. going already both have to is I the we initiatives feel but actual but team ability the the can't continuing efficiency and we're confident centers. at That's investment, really business opportunities unique different there, effort. greater. continue no the it's refinements implementing few in process So look the cost and efficiencies management potential for realized, FairPoint to companies to and It's side, post-integration, to secret find efficiency our this automation yet we that paid no opportunities say in

going allow the self-serve. historically has continue is we're so, along lines, not airplanes, industry to those And travel industry to invest and complicated in with ways that it’s the on customers This reality hotels, an to a that done behind to available interface to those for we're portal effective and online that us make more make it to a and efficient to that tools more or implement. more from perspective, want seeing what

finding still the back-office processes, or ago. we're that to that build when that us isolate have are but data integrations access we service tools five local by along the And available years to allows weren't that geographies, delivery front, technology unique XX and repositories the service and order did with

order So forward. I produce that pursue feel cost our predictable this our guidance giving to balance EBITDA to going real and in in by ability demonstrated EBITDA and margins for a the is business, confident EBITDA revenue that reductions continue now to

Unidentified Analyst

year? you just the And $XX was one the guided something you think you EBITDA stated, guidance there? in same I it last question. gave, of Great. that million quick beginning it That different million previously the to distributions is that for is have it $XX wireless or

Steven Childers

our upside Hey the $XXX feel view what with last business is million in year. probably based we half our mean Ashley. to even $XXX was guidance million, I of to the million, $XX is there's million the is, Steve. guidance for think and wireless about to the bullish core This so $XX I more on think but We

bit, a with that that. little be So, okay wanted to you we'd raise again, if

Unidentified Analyst

it. questions. for Great. answering the you Got Thank

Operator

Partners. comes from Song ArrowMark of line Our from Roy the question next

Roy Song

for Hey my questions. taking guys. Thanks

immediately. just On potentially cost get better much of any and savings would the other want the that forward, realized synergies expecting going headcount last quantified back clarity the reductions some cost on how I reductions you're specifically be question, to or from

Robert Udell

sure imagine do. EBITDA giving margin, can Yes. level like we reasonable I'm we've do and is the feel of that a I to to right appreciate not to that. detail the got XX% to XX%, question, managing all levers access you but We're

the restructures, reduction business process Some back because some result is broadband but commercial expansion of is be some cost goes or headcount generating in that changes that sales going changes into and organization focus bottom to of line natural and in carrier. in in more

we it projects it's all XX the of to in the and benefit, customer brings what with a see going of opportunities so And XX, we've it efficiency time. as balancing gains, what those terms accelerate got of

off, integration I can efficiency mode and due two and typically the some resources that are for like integration in refinement diligence spun integration new mode. the business we're cost What that say three-year processed is been be as and we the We're customer FairPoint so in the efforts, and and using anymore, in we'd so of being don't things our of have out acquisitions we of scale M&A finalized because of has business or see horizon. that next not

Roy Song

debt then helpful. Thank second the question Okay. That’s on my is, you. And reductions.

free help imply of? might about probably $XXX that by be I'm thinking churn, maybe a a paydown so me that the would of terms to if maybe your high another is coming math the So how going almost doing bridge – just any sources $XXX million, debt be debt Can cash in much very just level, taking down leverage or that other of paydowns. million better you back you of flow that little from envelope, of you're half basically

Steven Childers

Right, with $XXX goes not looking no the $XX Xx Well, million, you're period refinancing. so what again to so is facilitate the debt mid-XXXX at I'm sure first later be repayment. than towards at, the directly time to our but target million

a of hit I to or targets, against repayment has the for think go guidance debt we're largely giving leverage Again, lot but XXXX. that in anything XXXX. to going not XXXX, into

out so X% going think think a kind have year. models there I think So of we I and or if X% I going you us are down XXXX going into EBITDA to – what most doing stabilize is XXXX,

to are take to that number I'd going into in that consideration your out, so calculus. We have flatten like you

of most distraction That a with saving dividend, makes to there's our the numbers. the focus XXXX, sales, the that that, on asset repayment. savings, And had of execution. large to on to current a assume debt can going then we're we portion to relative earlier that million the anything you in then questions if And help accelerate not be $XXX debt that that's even could sense and that will business valuation

Roy Song

was Okay. $XXX million the you you Yes, level. that the guys that so right, that of the said had reach years span up will I you're to two XXXX

I just your that in from that $XXX that free reduction I'm debt aggregate Is here So come cash will million all guess largely right? flow. confirming

Robert Udell

That's certainly intent. the Correct.

Roy Song

Thank very That's Okay. all. you much.

Operator

comes McCormack from of the Guggenheim Partners. next from question Our line Mike

Michael McCormack

first, the you going difference on And Maybe segments, there quick anything on those with enterprise Thanks. then, on guys. to great? can comment two anything between comment Hey, landscape, guess, be would side. I Thanks. Any on? consumer SMB pricing competitive just market, the secondly, a the that respect and new

Robert Udell

really along seen for Thanks or we some few after got for Mike. same that XXXX compression timeframe. We're seeing late dynamic competitive the carrier timeframe Hey, through price early years, in last came maybe the really question. XXXX the we've the

And so that is it to a it's side, driving spending bit a I the consumer you couple that on consumer up, up little interesting We seems making even decisions, things. are that and spending. though would if say the slower, confidence commercial across look People industry. attribute is

having IT owners to providing really are business. only with applications an cycle longer process target or also with a sell, retention, not but One, you're to the but times deal they're solutions taking CIO better your cloud the lead, inside because

to very up which across well we on where our if that's regions, with, and so in wick, will doing it taking turning the the we're we're or heat them region, up strength one have multiple others. expanding you the turning verticals, And

in us I pressure So commercial just the don't I see I competitors also see beating longer lead there, deals on space. our times. see and don't the many price

question. responsive that's to So your hopefully

Michael McCormack

Thank you. great. That's Yes.

Operator

next Our Jefferies. line from comes Eric of from question Bourassa the

Todd Morgan

Hi, made had I you Two Todd questions, on the good Morgan. here. comments morning. guess is This in call

You and was talked tower a hoping the about just opportunity, I bit little that. about you further could speak

really Specifically, you continued tower growth that, drive opportunity sort from? see really to where there you growth is much how new and do to coming true of really future that from need bills XG is of the kind or coming the see of

bit you've sort little within the commented, year-to-date, that simply guide the the or and And guess, same. there that you. least because quarter is the plans or at non-recurring higher of reduced I had expenses, is of secondly, spending range Are CapEx full-year the Thank provided? in elsewhere, a yet CapEx is you just

Robert Udell

see Let me don't spending say as this Todd, let it – CapEx well, I start way. really first. the question, me with reduced

our that kind CAF so have We the Fund highest projects, markets that built you North get be in loose get probably had ability pent-up around England, projects, free spike ground the New year. second and as well quarter Connect that the of into really really, but, America and the and once the of Central queue to frozen breaks the April for some done May, projects seasonal the and up as the we're things cut to has we access is Northern to and to in caused wrapping there's year,

that finish are really things quarter really those customer-facing those obviously of are the and driven less, that to so expectations just We is to up the in lot and contractors feel customer that's are fourth continues things a have in so nature that needs. Northern quarter, that or revenue be there's markets, leave we the purchased, through of then that in projects it'll third equipment what curtain the now and continue labor we follow by the by the

the normal what really in So higher Xx we'll I guiding be the think past in seen are it's future, in that spiked we've what but a than it second course quarters. better

me remain Todd. question, other The

Todd Morgan

Yes.

continue? good the see bit tower If here. to speak see momentum drivers obviously need kind a the What to you mean, about of could I that Thanks. are more little opportunity, you

Robert Udell

Well, them for a we're both in discussions which driving opportunities net others or Smart who response that opportunities. the various indicators or build-outs, or opportunity some getting XG their own whether with of expansion – that AT&T's is the we're and leading provide drivers. them competitive sub I already them mean, in seeing markets,

a with You markets we as dense constant our being the and across rural great but XG opportunity. and there's across effort spectrum see markets the the standardization rural serve, opportunities suburban equipment also we have the for – built-out and spectrum a areas, this that XG identification occurring, we that's other first, the see towers more this

us commercial, we and customers conserve, of first, fiber extensions, having to this truly provider accelerate we do, offset we the you see we where network consumer finding our that some allowing doing In to our second XG an footprint their we're in best because for believe broadband we puts everything rural early build market the attractive in opportunities. opportunity a in in in making carriers which wireless can trying using and as network we're we're and carrier to create interested where and for position, like and it of can inning extend help long-term sustainable our a deployment within success needs, fact, power

Todd Morgan

That’s helpful. And thank you.

Operator

of Fargo. question comes the from last line from Our Fritzsche Jennifer Wells

Jennifer Fritzsche

Great. Thank you.

off following they the using the about on and the of talk We fiber of backhaul. Just just fiber Verizon some some last and replace continue up to call, to that question.

not say to urban be is that's – confirm, more I seeing Would continues partner, you're you that fair not to growing in Just you're activity? or Verizon happening would of think to say a markets. type it

Robert Udell

of a Yes, reasons, Jennifer, institutional with push-pull most that, of have going carriers in isn't look other exploit serve. and for even that's occurs, to markets case we number where and the they the that that they're always a to fiber customers, discussion large

to and a expand to good-quality So competitors of think, in our Verizon, service we relationship one position reputation. provider good we're, back in response and towers a continue we're our on some considered from based fact with

fast that about into have we it, – even I past because but and initial because we service hear reputation. we in don’t can we good-quality have a build those don’t it fiber us turned gotten dark say for the I request wouldn’t So managed opportunities do,

Jennifer Fritzsche

but another conversations you stuff, so are put opportunity? you emerging I wireless – I'll could can that Dish having then ask with And also just Great. what call entities with early and it's other on

Robert Udell

We're all over a to our every whoever and suburban wants expand rural markets. angle network provider to in and TMo-Sprint ourselves for positioning of the merger be

how in there's place solidified believe excited is eager will in really see little and finally take getting this. to very risk see upside provides overlap relationship about that deal we're the to America we're So there, activity come rural any and that our from investment Sprint and TMo and

So we're excited.

Jennifer Fritzsche

Thank you.

Operator

time. this turn Mr. are Bob at Udell. over I back the no now to will call question There

Robert Udell

quarter forward questions appreciate third appreciate your sincerely joining to continued support our and your of company, appreciate updating next call you you today on We time. and look our

Operator

Ladies and This today’s thank concludes you us. gentlemen, joining conference for call.

You may disconnect.

Consolidated Communications (CNSL) 1 Aug 192019 Q2 Earnings call transcript