CNSL - Earnings call transcript Q3 2019 | Consolidated Communications Holdings, Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to the Consolidated Communications Holdings 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 is being recorded.

I would now like to turn the conference over to your host, Ms. Spaude. Jennifer ahead. go Please

Jennifer Spaude

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

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

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

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

over Udell. turn I Bob to now the will call

Robert Udell

for morning, you, you Good is today. Spaude best and Lisa a lead. Investor taking and adventure. Jennifer we back Hood on Thank new the new Jennifer. everyone as in very her Relations opportunity our thank joining wish us her is

$XX the is We quarter, about additional value capital sheet. our executing plan, on We're third our and improving plan progress million. allocation flexibility by long-term making of financial are and In deleveraging we reducing cost creating for which capital. This on shareholders. strengthening creating our our focused is debt, future debt balance our reduced

this revenue more and consumer million me we're prior almost performance the revenue I’m from year-over-year with progress making, Broadband quarter-over-quarter. with update starting broadband business grew in consumer. let increased you strong pleased revenue and X% quarter Total $X Now growth. with the the than the on channel.

broadband consumer speeds locations. connections, more two key continue is we available In driver bandwidth for with improve rural we've upgrades. results customer with Increasing our years, primarily and to than the lead XXX,XXX last to ARPU growth. services drive increased increases as Our speeds the

XX,XXX consumer end-user upgrades carrier our A and the upgraded In customer for quarter, three leveraging northern assets. Capacity common we growth our third in for speed fiber locations X gig of enabled upgrades channels these commercial customers. New for example good England. speeds to required

our began Last to Chesterfield, of This that This pipeline would municipal nearly partnership. its unique a a we network. turning a We’ve great up week, Hampshire, of model in markets. the the is all of passings, bonds five additional public-private is in XX,XXX home fiber in in an in example construction suited totaling perfectly partnership, New to fund subscribers kind opportunities XXXX. construction is first an which incumbent to begin leverage effective of provider world a as leveraging capabilities

we're broadband and CCiTV, a based investments, a Through Maine. new partnerships, innovative optimistic in including efforts business. Portland, of combination technologies we fixed cloud quarter the video on announced targeted the Last consumer wireless, public-private launch of service

product. customers are low over capital will far a the capacity own very with is This reinforce the than I’m early bringing but expect phase, adding the of launch time this their and subscribers low are XX,XXX in and sorry, XX% metric -- more nearly so and data broadband evolve intensity It half lift -- service the we of devices.

made We're our consumer plan the by the We to and of progress and New end launch with offering this Vermont very CCiTV pleased in Hampshire year triple year. play a in the channel.

solid enter New quarter, in seasonal anticipate with positioned fourth are rate. a we run XXXX we suspends England While the to

track nearly just and and to in XXXX. commercial in both our we transport revenues. we're over year-over-year X% growth and quarter-over-quarter The in full-year transport data growth and on channels, Within realize data year-over-year was carrier experience and rate X% increase

sales based driving SD-WAN solutions. a on our competitive trust natural WAN multisite of solutions a commercial portfolio consolidated reliable, expanded our advanced to focused services. in building customers This provider. -- our channel, a upgrading had expand In high-performance customers We've customer us as through success approach is we're and better portfolio evolution experience on

A added visibility SD-WAN their bandwidth even majority business uptime, on seven who traffic bringing are over win customers their network their network our our footprint through prioritized site the applications speed a increased involved customer is other critical and fiber SD-WAN recent with sites of The diversity and usage. more network. and get into

our as within well support and adding after momentum sales gaining productivity and and These team, They also suite services. launched SMB retention they use. Microsoft are additional acquisition resources or bundle. need everything quarter, easy-to-use customers This we are a small website to We're efforts. BusinessOne as business they wherever our our management be services and email to complement choose nice to connected provide productive device to stay whatever past

of connections carrier tower Total transport achieved the wireline carrier Our quarter has and consistent a within channel contract in of Ethernet XXXX, XXX Revenue tower total than more a Internet. strong driven to to reaching by under XXXX. X,XXX third wireless or connections. and channel services our be continues by mix X% compared results solid increased dedicated

doing team of that carrier negotiating continue is excellent long-term contracts offset sales special services. Ethernet to job access Our TDM and drive an

are services consumer Our benefiting made also and customers. network investments for carrier commercial

$XX expenses million opportunities, to attention down operating third more cost in quarter year-over-year. our turning than Now were savings

cash initiatives implement free identify stabilize the to continue to and and flow. transform business We

As initiative example functions. of care an cost automation example savings consolidation customer -- continued of initiative and cost is a the our savings of cost an savings --

options These helping cost portals experience and who customers customer and realize these streamline We've for developed robust the align choosing with savings. are to business self-serve are us tools. do via and changes us

on guidance. to well call results as will our our over financial third the Steve, full-year quarter now turn provide for the an on will Steve? more who update I as details XXXX

Steven Childers

Thanks, Bob. Good morning, everyone.

another and We EBITDA consistent of quarter and stable to are achieve pleased revenue. adjusted

flat performance. with and essentially our is the quarter third generated the starting adjusted $XXX.X million, quarter. for Operating with $XXX of second First, revenue which totaled EBITDA consolidated million

channels, Now consumer. discuss our customer of each starting with

sequential our strategy revenue a to consumer down video in data and total revenue services million from more was voice, with consistent was For million basis. linear improved million. $X.X X.X%, broadband all transition $X or to away down video low-margin $X.X video IPTV declined centric voice Year-over-year, the quarter, and

revenue million as all quarter. key grow or in balance ARPU our markets. rate However, increases of we in third is $X.X broadband the organic consumer improvements did Data X.X% catalyst the with ARPU

We continue and to to expand are mentioned, as momentum in with leading specifically opportunities And excited our broadband data, marketing we're we to about locations. services. now updated the areas realize Bob to upgrade than positive where XXX,XXX by continue newly more partnership technologies new in

$X.X Revenue Other $XXX.X $X.X was the and million Data to transport down year or declines driven million. million, $X.X services Now for revenue .declined quarter services. associated traditional legacy -- turning grew for carrier revenue our revenue commercial X.X%. Voice by in to X% channel. $XX.X million the access revenue the million declined lines quarter. and for and

$X.X that final declined to revenue driven XXXX. Subsidy CAF-II access revenues per transitional million in occurred We approximately step-down $X.X quarter. down in revenues Network $XX now or million, impact of support rate be were run expect million subsidy XX%. approximately August the by the our

to which will the be We Fund, FCC's speeds America. Digital Opportunity do rural urban to in active Rural participants plan

will who these infrastructure network rich don't fiber us markets. in over rural give have our confident are competitive We advantage those

we within network. locations will the have as fiber evaluate well funding service as area We our where edge out

as to with potential are the objectives the excited opportunities commitment our fund and broadband. improve Consolidated of for We this align expand about rural

benefits initiatives. $X.X at declined amortization year. million, of down million, services improved or products million $XXX.X and of as and driven third depreciation quarter which expenses, last with exclusive network result realized and Looking ongoing from savings optimization operating reductions and associated FairPoint the a synergies Cost X% by cost cost and were salaries the $XX.X lower of

$XX.X the Net recent was due third operational compared $XX.X ongoing quarter, structure restructuring SG&A costs last charges interest $XX.X expense and to the integration the the combined quarter same primarily and year. last with for cost million were million synergies efficiencies. run in in to reduced year for period quarter rate million

of cost approximately X.X% debt XX. average September was weighted in Our

in the improvement $XX.X ongoing quarter and $X.XX Adjusted last was efficiencies. per from million to the to expense $XX.X were income operating cost year. in year-ago. decline wireless The $X.X company's share net for as focus same $X.XX on as distributions depreciation structure third of loss quarter net Cash partnerships a million compared a well reflects million per compared the share

We’ve was which costs, in level invested CapEx construction seasonal $XX.X by million driven higher to The restoration in during and be fourth the the capital third quarter. consumer quarter. growth, additional hurricane broadband expenditures we and completed expect

higher impact revolver cash stated million. insurance EBITDA of the our proceeds, impact was expenditures Total recovery achieve on consistent under hand $XX our ability performance and will cash capital liquidity availability including to leverage not and goals. our the approximately Combining the

net third at the Our ratio the X.XXx end quarter. of was leverage

the the capital by demonstrate which new on continuing boosted at progress debt sheet. balance our $XX.X declined retirement value. in our Total allocation while deleveraging, executing We are the million senior notes on by quarter, focused par improving unsecured is during million to policy, of $XX

our we XXXX of than advance will was no repurpose goal we billion our being our as With strategy market less dividend improve debt will prioritize Consistent pay achieving we leverage our open structure unsecured the Xx, quarter confident, deleveraging capital of QX than to purchases of third quarter we this strategy, total to full refinancing our mid in the The QX, -- debt. without we bonds. accelerate are net capital dividend our with first toward of we opportunistic of down as later and payment. savings continue with

expected are $XXX Today, and -- guidance the of million. income $XXX for is expected Cash which interest in of full-year our costs the million. focused range to on are to to be adjusted than $XXX million taxes affirming to are $X achieving $XXX million EBITDA, in million be We to we less range cash intensely $XXX million guidance. financial

to of to We for projected to full-year capital is expenditure associated with success now million million as the our additional which as restoration the the are expected $XXX $XX.X based million capital expenditures be $XXX range hurricane well CapEx. guidance, updating of in account

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

Robert Udell

is first and we're reduction. implementing target on allocation In our debt you, track this Steve. Thank capital closing, quarter since our completed plan with our

We of balance and our cost value. revenue We're sheet delivered results. create initiatives. also and Expenses strengthening another and ability are on confident reduced stable have quarter our savings to in focused our I'm cost-saving long-term and continued EBITDA business -- we’re

questions. take now Operator? will we that, With

Operator

first Your Instructions] question from Charbonneau Cowen & with Jon Company. of line the [Operator comes

is Your line open.

Jonathan Charbonneau

taking for questions. Thanks the Great.

to Thank type growth should For the the type still And that a Because thinking imply growth then data you do X% we how fourth about transport the year? business? that the is in would you. notable uptick still X% revenue, and be longer-term, expect for hit quarter.

Robert Udell

question. the for Jon Thanks

And quarter. optimistic queue. into of some above that third pipeline are quarter, X,XXX which and on power sales fourth which we are strong carrier our accelerated per very have accelerated platinum gold, are very got also month, some we in which some large third the in that in We is we quarter. We’ve the the categories,

going it's core but X% of it saw Metro be the nice a those matter some voice closing year-over-year getting is increase we -- our growth deals in -- to closed, over and And them hosted and very installed. are could X% -- up. deals also So E all products, increase

accelerated be So we’ve third construction done. that will the we monthly the NRCs are think still get work the could that. where that But it fairly billing less And X%. optimistic recurring comes quarter we with than about and installs the slightly I into

Jonathan Charbonneau

that we growth should just how then is the going is be longer-term, forward? business X% -- then longer-term and type And that about -- thinking of

Steven Childers

Hey, this Absolutely. Steve. Jon, is

be -- we’re minimum basing our forward. -- for our think invest That’s investments, our we’re it sales should fiber is the objective resources I X%, that’s and where going internally where at. make

but base mean do, going kind be to needs of So we’ve there. at to I some threshold forward the of that bottom the work the

Jonathan Charbonneau

Thank you.

Operator

comes the Citi. question Michael Rollins of next line Your with from

is line Your open.

Adam Ilkowitz

in than if fairly the for footprint, anything questions, help significantly Are in the Good us broadband expense And if you that morning. bit on Thank revenue, a could. consumer expansion there's the line it the on you broadband One I could or future the that net Ilkowitz disaggregate versus more can then down XX%. DSL is you on reverse price little customers, benefit, of This was you. Hi. mention quarters? Perhaps Adam of understand sequentially Mike. given SG&A can this you customers? if sort quarter may SG&A, gaining came Two that.

Robert Udell

have ARPU components the as take Adam, and second. on really markets that, will of the had part there perform the continued two Really the speed continued I of price, legacy in additions take will increases as said both lead consolidated Yes, aggregate We revenue. quite there's Steve well, first the subscribers. as upgrades helped you and to consumer well

speed FairPoint are upgrade so a opportunity. we had significant And FairPoint where markets legacy markets,

And price the those increase it's enabling speed with speed really grow XX-XX from opportunity aggregate, and so upgrades you as coming as across to when penetration. look well upgrades the us

Steven Childers

Hey, this Steve. Adam, is

question -- the back QX is SG&A at the quarter think window cost. year, was integration of cost compared third I even way I The On second for that of this on your locked year, on into look will FairPoint we quarter sequentially June XX. adding to last

were So on we accelerated into -- second things we sequential kind some a quarter. basis, of

So one although QX. severance sort we less some as incurred integration we severance, thing that's expense should see still in and of

things the the consolidate some in actions have side. we at continue customer And level. You of as we work some we refunds -- particularly had in are service also then, state seeing based also on to QX groups, the the on on taking going benefit tax

to forward. that So going to we're continue going focus on

Adam Ilkowitz

Steve, you perhaps I of I which refunds? integration Thanks. benefit quantify of? usually the the the level from we to state can maybe, remove impact understand And expenses, tax the mean, the try

Steven Childers

that specifically, of much as a I would -- $XXX,XXX. don’t to probably $X.X number much million as I say as maybe but it's maybe have

Adam Ilkowitz

Okay. Thank you.

Robert Udell

of within it's constant to process service opportunity FairPoint has and the we opportunity, that across even business, the typical is done especially the seeing something integration Adam refinement the an channels. are the with acquisition of size this refinement, ongoing we’ve been of more even delivery And business every

benefits, and continue us to shortening centers work of scheduling expediting and to to benefits those functions and or to so, allowing installs, booked consolidate cycles, And flexibility as even revenue more automation billed the get more centralize virtually we find linked are time in zones. cover

refinement the driven group automation constant continued at delivery process, each So of looking efforts. service customer primarily the refinement a by it's and in

Adam Ilkowitz

you Thank very much.

Operator

of line comes the with question Guggenheim. from next McCormack Your Mike

open. Your line is

Michael McCormack

seeing on exposure, perspective? guys. the replacing with seeing guys connections pricing guess Thanks. what on on then Maybe I And seasonality? business, it, and SD-WAN Thanks. as from Hey, there comment quick what just obviously you data as the to you’re out side, respect probably MPLS is a far which consumer go the a were

Robert Udell

for the Okay. question. Thanks

start side. the you with as commercial did Let's

replaces of academic lifecycle. SD-WAN, its it over For But long be that incredibly view to that’s time. logical the conclude to that going an MPLS

our opportunity is study. I example it us. comes We ARPU And to seeing are multi prepared actually SD-WAN commercial remarks XX% a case customer growth the as a when site for perfect gave in

in get are some remote seeing many they of are of footprints location that We and their in multi control and connectivity customers SD-WAN to couldn't add our in way their critical site, of extended a our that which many previously. are applications

may levels, us to previously. more an customers extend paths it's in using Ethernet now. so Metro then what it's enhancement at us transport And basis And for dedicated and smaller bandwidth allowing have even a thought right

a revenue So to date any that inclination we as of write-down. haven’t seen

compression ARPU an sites multi opportunity. enhancement to as us So a price mentioned see SD-WAN. an don't as I basis, exactly pricing think customers. more link It's allowing on our I that I addresses together for perspective, From your SD-WAN location a been

typically in New to moving some the England. we do Now seasonality we’ve consumer, expect seen northern as

queue discussion wait the they suspend center of it versus scheduled allows month for them Although suspend puts using begin for to the in it we for heaviest to seen -- call a have in and in -- now when XX% a that October to process takes disconnecting roughly their who have are customers control process a install. without we’ve an reinstall volume, small the out service. that of that typically of the in automated fee And having hands it suspend typically our

we And in we’ve maybe it what So it's affected something has seen dramatic past, be expect don’t as suspend as be to the cycle anticipate. will that. much automated this how the but the actually on process we indicator

Michael McCormack

Great. Thanks, guys.

Operator

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

Your line is open.

Jennifer Fritzsche

environment Development old -- on I out the Thank as about Opportunity you. territory. pasture updated you're secondly, you seeing mentioned the to Thank being And Charter the you've offering? Great. how thoughts as thinking wanted an on RDOF then I Are I Rural aggressive called, think your competitive that? roll any FairPoint see you. in to ask if respond this, may. I way in sorry Two, if competitive you it's Fund or wanted seed

Robert Udell

first second the and think we're quarter and a pipeline then success Yes, of giving I will more better we've this take come technicians we're in and installs that quarter think the We service and in still proof niche. and on part competitive looks to RDOF. revenue response seeing have The the seen back right tools. we're is delivery terms good. in the uptick of really rate in we last the process We the

are Charter we always targeted. pricing, on effort been and success and we national to were the England of Charter's northern having response there approach expansion in on and ability of followed that our see We as marketing pricing our them when many a we we now a has customers. typically result can very but in are aggressive and right hit no areas surgical compete be on focus our seeing markets our to neighborhood-by-neighborhood with said upgraded approach the and process the because specific going a focus install improvement so we be appointments for and the New

in say we're seeing anything market different wouldn't So other than this markets. what I in we've experienced

Opportunity Now back to Digital Rural the Fund.

the America. very in to about of revolution rest we This and degree are some of wave this. internet excited what next is to be We view digital the connecting

and through giving the we're to in with at process. something we a our very and got advantage national we've that auction FCC is markets competitive rural input in and So associations believe infrastructure the good active we're

do get to making weightings access it's maximum of service and end only also going but the bandwidth users the sensitive possible to so minimum that and sure be appropriately think with a broadband And a not XX X, to we and to best all of position good experience with got we've in technology. us best terrestrial extend very means and fits types whatever our a latency wireless address end-user or fiber situation in -- the those put through fixed networks

So close for and that period comment the carefully to auction. good we out in preparing order the a it staying outlines process watching the for January plays how are

Jennifer Fritzsche

you. Thank Great.

Operator

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

Your line is open.

Davis Hebert

morning, questions I few here. everyone. Good a have

questions. follow-ups The prior first two are to

something I it upgrade footprint, that increase is surgical increases, and higher big suggested pricing that or you across done more as as one is wonder the price On just in take your people speeds was you speeds?

Robert Udell

price The our philosophy consumer basis. region-by-region match increase associated a is with on

So pricing I provide work We back guess to we hard surgical right is probably increases to that very customers. close the with something only to term. deliver our

case price at increase had to increases enabled their as automatically have speed So $X.XX dominant would been area a to $X.XX matched a in them speeds move slight them we wish we and customers reason this increase. or with a for faster broadband the automatic a either with the upgrade that way an across retain

Davis Hebert

on XXXX said there. you rate basis? of But I That's And just into there might should lumpiness. $XX expect know run SG&A, run on Steve then a the state million follow-up quarterly continue of helpful. that The Okay. a tax to -- rate bit a be little we some

Steven Childers

function. better Davis. as in we the looking markets, get continuing I I to be there. going again But office in think at it the efficiencies we're throughout ways back probably said there's should particularly onetime some items mean both close,

number a with. good that's start think I to So probably

Davis Hebert

payout. to quarterly That's And was helpful. nice close see this and historical it definitely reduction the that then Okay. dividend to was debt on your quarter

or to loans and going was should the still open as something curious are you expect open bonds back preference buy some I the in repurchasing we just is well? to So market that forward is

Steven Childers

I goal savings. your the million, Well, so one, million dividend's a $XX.X point the probably is $XX number think right around to quarter

in a quarterly of number kind having can. -- of do spike we We that's targeting that in on that's had on reduction CapEx hit didn't but based level are of target more We we'll that sort kind the we basis quite where is our QX. and if of

best or it's down revolver, right the whether bonds market the I for as we're evaluating now think the we're just paying term term repurchases or -- open debt I at think the I looking that or highest bonds And return every for dollar where currently trading is go. our that's would maximizing if use think of we accelerating focus deleveraging But we mean are on I where can. cash.

based now just probably So bank is notes, where trading I trading, a understand the they're right totally the debt's at right discount the towards but bias also on now.

Davis Hebert

last expect we higher a the know we in little question form CapEx Yes, guidance there. rollback in XXXX guidance. the you expect a issues CapEx the be okay. I on And know may role -- year? a I slight playing next should Should maybe mentioned then you haven't given but bit for

Steven Childers

Yes.

million the puts growth with CapEx If you guidance core a for growth behind of largely reduction some activities look this year's broadband us. in us the prep and $XX network integration

somewhere year replacement of Hurricane storm And costing be $XX the -- result actually and so bit as structure by expect reoccurring. this year little feels the still not of integration a near with of it over end a a million million a would like in that half been recovery, Michael cycle to over in $XX year has which Florida

that the down So call we XXXX. for and a definitely we expect next give CapEx in guidance step in will

Davis Hebert

all. Thanks great. Okay,

Operator

Goldman question comes with Kim of next line Jason from Your Sachs. the

line Your is open.

Jason Kim

in goal? Great. to your asset sales Thank nicely picked terms of pace help the noncore quarter dividend. buyback the bond updates with up the this you. And Any on deleveraging of elimination

as bond you Your you're is to direct cash well level comfortable buybacks? modestly up look to balance $XX that Is flow second to quarter revolver revolver versus balance current as the million. a free with

Robert Udell

dividend the the to expect Okay. as bond leverage piece, we that. we will address reiterate Steve committed but to just mentioned, to continue to buyback are will And to do reduction. tell I Steve allocating you

feeling some replacement progress. the insurance as I are activity, seeing also result activity hurricane slightly but of lingering and we about a we're think good recovery rebuild the revolver proceeds lag is of that up that

add? about talk else So, to you bond repurchase, anything the Steve, want do to

Steven Childers

we think and talked sales we've -- I in -- the on asset continuing question past we think so sales about the asset I evaluate. first are to Well, are was

different We are market getting different inquiries opportunities. -- some on

would evaluating we're a basis are not doing kind to want mean on we proceeds. And the valuation on distressed leverage any would it anything for what those We be what do clear a with basis. of kind a of I

for like the our obviously, We of accelerate the take using we like to we're your that -- revolver deleveraging if and also on we talk business. be today, bond but same in short-term. mean that savings Nothing the would kind to on that focused to because in are consideration. see too to investment the valuation that one looking quarterly less of on are in help reduction. some we the asked the about we repurchases. is to a We targeting but question under dividend are We zero using Davis I short-term basis to would the to to could, debt

how are to timing As hurricane liquidity but balance be to the relative in open relative the to Bob insurance disciplined of the we opportunity in said, QX market do repurchases. recoveries because it's of elevated and going we very kind to

Jason Kim

Thank you.

Operator

the line with Matt comes Baird. next Your Swope question of from

open. is line Your

Matt Swope

Good morning, guys.

same Just to be? you those to insurance how much line, continue Steve, proceeds expect do on that

Steven Childers

very a direct cap so that but a CapEx to But an refunds are to to -- recoveries be would to works property sure it we of then to perspective, way loss are having I'm the number, it's from goes close honest offsetting the on to not what way or would it's to expense loss basically about off. in even give though it -- the we're is. we refund, direct we I'm and to expect kind write are accounting first that that on total be the So offsetting you the the refunds -- hard be not think basically we about -- the the expect going

back looking in like claim million $XX think coming to a I through total received we've of million $XX think and $X.X we I So are QX. million at

Matt Swope

any flow amortizations on covenant you dollar cash use could are loan you. use bonds? on you how helpful. the limitations is anything of Got back to dollar Could That apply that? you other there term Does free the required than restrict buy every use And that? every

Steven Childers

No.

Robert Udell

restricted language payments in prevent from the to There's basket said. doing exactly what no you us

Matt Swope

That's sales could Verizon noncore any wireless or there and thinking partnerships great. target the question otherwise those on sell be wireless from partnerships partnerships are a to? your the you about that asset are could there to something And who then restrictions of wireless for

Robert Udell

not we so the a is they're we but to about off think flow. annualized -- $XX or it that I'm open Well, year on would cash free million direction million in way $XX feedback, or putting

expense operating no have going We against that.

requirements. capital no have We

are We limited partners.

flow cash ownership one on our share partnerships. Our based those each shares cash flow of are in our percentage of the

we’ve tax made in have a years carryover based so So predecessor couple very, were basis -- very we acquisitions we’ve in we properties these. the a from tax acquired ago investments low basis the of the company which on when

not knocking way we short to expect think for a But don't us door happen. it -- the it. really So about multiple give somebody in we that on we if the would that certainly again would consider that it we're seeing came our tax-adjusted term

the to investing leverage million to going down debt. $XX year we're operating on the in a network again the business paying or $XX So million fiber

Matt Swope

to be And just have asset offered you with the that hypothetical asset can to that loans concept you any really be it could concept you -- covenant different stay -- a whether to -- first? proceeds would retire another or use to that or use question proceeds asset bonds the or the sale for use the can --

Steven Childers

great are the credit on basked I there limitation you rules the have need if -- that you’re agreement. basked more probably talk basket like -- question sale on -- think sales. probably one agreement That's -- probably asset a under But to than there's the to you I really I our and shouldn't be the have administrative above you're -- I'm think could there an if asset optionality inside credit agent

paying optionality So on we're paying on I debt asset they're help -- to being good we're in discount of they're like when of you both But there no again prefer down we can. bonds matter even trading us thing mean invest a capital we depends. your how we're if -- the at point raise it if I it so going deleveraging sales focused through to business if But though down to some deleveraging the look at bank kind we it. able both it's if think we

Matt Swope

Steve. Thanks, great. That’s

Operator

comes line with question of [indiscernible] Aaron Credit next Your from Suisse. the

is open. line Your

Unidentified Analyst

in to had Thanks with if you and of to better taking and structures sort term terms Most help that sort creative of your do started conversations the have you a Hi. that term to rate refinancing? Yes. any of questions. on potentially have could Quickly partnership for been you Verizon banks -- refinancing theoretically asked on get have loans see do of just a loans around I sort wanted some my answered. potential itself,

Steven Childers

and today. about I think always but we're strategy, optionality talk there's always to nothing ready

Unidentified Analyst

Fair Got follow-up will you. I it. offline. Thank Thank enough. you.

Operator

of next with question UBS. from Your line the [indiscernible] comes

line Your is open.

Unidentified Analyst

and costs you as to having Hey, service to be in have chance to looking and Are that use there you cost certain guys, want -- areas? not possible you that those a I fund. a might areas the that just for way and areas would not of is saving follow-up provide there funds high on providing that opportunity forego

Robert Udell

Yes.

I the go beneath point were associated for position option a chance. with always we and of with in think all the want be think we're return in walk it from to if going there's -- it then that what is that I particularly minimum to that costs we away now break with census right mean the to the understanding into block. interest

the cost perspective if it's an and we we avoidance last shake a and come carrier to chance obligations both can perspective. and of walk because that we the from that resort away expense capital with always going be that there's So operating believe from do

it interest that So but out block opportunity does census present the operate. starting of a currently we each which threshold in intention or for with we having we're have

Unidentified Analyst

Got it. you. Thank

Operator

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

Your is line open.

Jennifer Fritzsche

Great. Thank you.

T-Mobile if you're T-Mobile seeing of pause traditional to to been will in from on tower. I'm merger? Has resolution both space. revisit Sprint some, Sorry been I more we any sort in wanted the just some that it either or call get that. been wondering until I their there pregnant chitchat some tower or the fiber markets has There's slowing

Robert Udell

the have so coverage going based say we Sprint can't with not is of. of to our because careful NDAs would at bit the consistent we less of good. are have noticed what I little we higher from than time, that. existing a Sprint and have carriers and be that to in I And our run on saw we've that's a all demand point carriers What backlog say maybe from we rates for atypical be seeing already all four with existing is It's respectful we coming that I but the markets. this year-ago are

can't T-Mobile. say So with regards I to there's definitively if obvious unique or anything

Jennifer Fritzsche

Are into how themselves it. little regional I They're if Bob, I come your working a could in And build more with kind to you relationship a in fiber them press I markets. then, on is has just guess would a Verizon. XX building had partnership more areas. of partners markets or say model seeing not, certain as of Verizon fiber also

Robert Udell

seeing our It that their we being are versus larger has speculative as some stage in as least -- -- those had versus noncore NFL aggressive -- versus outs. at those them see of more Verizon those and in opportunities We this is very seems at markets. are build Those opportunities. interests markets

tend so an business. fringe the not And to facilities market-oriented markets we where we have of are But benefit. on those we NFL

those rural and different any typically that I suburban and wouldn't way in us come the I in so strategy later of think and opportunities predominantly being this plays out. terms are We see to

Jennifer Fritzsche

Perfect. very much. Thank you

Operator

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

Robert Udell

the thank next Well, in We a Have support. your earnings interest forward questions company for our and for you again, we to day. on the your great with you chatting continued look call.

Operator

today’s teleconference. concludes This

may now You disconnect.

Consolidated Communications (CNSL) 31 Oct 192019 Q3 Earnings call transcript