HickoryTech Corporation (NASDAQ: HTCO) today reported earnings for the third quarter ended Sept. 30, 2011. Revenue totaled $45.2 million, a 4 percent increase year-over-year. Third quarter net income of $3.0 million, or 22 cents per diluted share, was down year over year partially due to a $1.9 million release of income tax reserves and a $1.1 million fiber construction project in third quarter 2010, both which increased net income. Third quarter net income is 10 percent higher on a sequential basis.
“Our third quarter results show continued positive progress with our growth strategy and key initiatives,” said John Finke, HickoryTech’s president and chief executive officer. “Managing our strong cash flows and leveraging investments in key strategic areas continues to be our focus. We see solid demand for our business services and our consumer business remains stable. Extending our fiber network allows us to pursue new growth opportunities across multiple customer segments in new and existing markets. We are on track to meet and exceed our objectives for fiscal 2011.”
Capital expenditures in the third quarter totaled $5.6 million, down $900,000 from the same period last year. Business Sector capital investments totaled $3.2 million and supported local market expansion, capacity upgrades and success based initiatives. Telecom Sector investments of $2.4 million supported core network services and broadband growth and expansion.
“We broke ground on our Greater Minnesota Broadband Collaborative Project in the third quarter which will further expand our fiber footprint from St. Paul and Minneapolis to Duluth, Minnesota,” said Finke. “The majority of this fiber route will be completed in 2011 and we’ll begin the northwestern Minnesota route in 2012. We continue to invest in long-term growth initiatives while maintaining strong cash flows and a solid balance sheet.”
Business Sector (before inter-segment eliminations)
Third quarter Business Sector revenue totaled $28 million, up 10 percent year-over-year, driven by steady growth in equipment sales. Costs and expenses totaled $24.8 million, an increase of 12 percent year over year, the result of increased equipment sales and sales and operations expense. Net income totaled $1.9 million, down 7 percent from one year ago.
- Fiber and data revenue totaled $11.6 million, down 14 percent year-over-year and relatively flat from the previous quarter. A unique fiber construction project in 2010 added $3.3 million of revenue and $1.9 million in pretax income to the fiber and data product line in the third quarter 2010. Excluding the 2010 fiber construction project, fiber and data organic revenue grew 14 percent.
- Equipment product revenue totaled $16.4 million, an increase of 35 percent year-over-year. Equipment sales increased 43 percent from the third quarter of 2010 and support services revenue was relatively flat year-over-year.
- Business Sector operating income was $3.2 million for the third quarter of 2011, a 7 percent decrease year over year. Excluding the fiber construction project in 2010, Business Sector operating income grew 107 percent in third quarter 2011.
Telecom Sector (before inter-segment eliminations)
Telecom Sector revenue totaled $17.9 million, down 4 percent year-over-year. Telecom Sector results were stable and reflect growth in broadband services offset by the impact of declines in legacy network access and local services. Costs and expenses totaled $14.9 million, a 5 percent decrease year-over-year. Telecom Sector net income totaled $1.8 million, down 2 percent from the comparable period in 2010.
- Broadband revenue totaled $5.1 million, up 5 percent year-over-year. Broadband revenue includes DSL, Internet, Data and Digital TV services.
- Network access revenue totaled $5.5 million, down 5 percent year-over-year.
- Local service revenue totaled $3.5 million, down 8 percent from one year ago, and local access lines declined 7 percent.
Debt Position
Long-term debt and total current maturities totaled $120.6 million as of Sept. 30, 2011, up slightly from the $119 million as of Dec. 31, 2010. Net debt, a measure of actual balance-sheet strength that subtracts the cash balance from total debt, totaled $109.3 million as of Sept. 30, 2011, a $9.6 million improvement from the $118.9 million net debt as of Dec. 31, 2010.
The company completed the refinance of its senior credit facility in August 2011 at very favorable terms and conditions. The new $150 million agreement includes $120 million in secured term loans and a $30 million revolving debt facility which is currently unutilized. The new agreement offers the company access to additional financing to deploy capital in pursuit of its strategic growth initiatives.
“We are very pleased with the terms and cost of this refinancing,” Finke said. “This refinancing demonstrates the confidence our lenders have in our business plan.” The term of the new facility runs through 2016. Borrowing under the new credit agreement bears interest at 3.0 percent plus LIBOR based on current leverage ratios of approximately 2.8 to one, with no LIBOR floor amount.
In the third quarter, HickoryTech announced a stock repurchase program in which the company intends to repurchase up to $3 million of HickoryTech’s common stock. Additionally during the same quarter, the company declared an increased quarterly dividend of $0.14 per share of HickoryTech common stock to be paid in the fourth quarter, representing a 4 percent increase from the previous dividend of $0.135. The company has declared shareholder dividends for more than 60 years and has increased its dividend twice in the past five quarters.
HickoryTech increased its fiscal 2011 outlook, as outlined below:
- Revenue is expected to range from $162 million to $166 million (previously $158 million to $164 million)
- Net Income is expected to range from $9.3 million to $10.2 million (previously $7.4 million to $8.7 million)
- Diluted Earnings Per Share is expected to range between $0.69 to $0.77 per share (previously $0.55 and $0.65 per share)
- CAPEX is expected to range from $20.5 million to $24 million net of government grants for Broadband Collaborative Project (no change)
- EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is expected to range from $42.3 million to $44 million (previously $41 million to $43.2 million)
- Debt balance at Dec. 31, 2011 is expected to range from $118 million to $123 million (no change)
Conference Call and Webcast
HickoryTech will host a conference call and webcast on Wednesday, Nov. 2 at 9 a.m. CT. The dial-in number for the call is 877-774-2369 and the conference ID is 17033253. A simultaneous webcast of the call and downloadable presentation will be available through a link on the Investor Relations page at http://investor.hickorytech.com.
About HickoryTech
HickoryTech Corporation is a leading communications provider serving business and residential customers in the upper Midwest. With headquarters in Mankato, Minn., the corporation has 460 employees and an expanded, multi-state fiber network spanning more than 2,750 route miles serving Minnesota, Iowa, North Dakota and South Dakota. Enventis provides IP-based voice and data solutions, MPLS networking, data center and managed hosted services and communication systems to businesses across a five-state region. HickoryTech delivers broadband Internet, Digital TV, voice and data services to businesses and consumers in southern Minnesota and northwest Iowa. NASDAQ: HTCO. For more information, visit www.hickorytech.com.
Non-GAAP Measures
To supplement the Company’s financial statements presented in accordance with GAAP, the Company provides certain non-GAAP financial measures of financial performance and position. The Company’s reference to non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results. Non-GAAP measures are provided to enhance investors’ overall understanding of the Company’s current financial performance, financial position and ability to generate cash flows. In many cases non-GAAP financial measures are used by analysts and investors to evaluate the Company’s performance and financial position. Reconciliation to the nearest GAAP measure included in this press release can be found in the financial table included below.
Forward-looking statement
Certain statements included in this press release that are not historical facts are "forward-looking statements." Such forward-looking statements are based on current expectations, estimates and projections about the industry in which HickoryTech operates and management's beliefs and assumptions. The forward-looking statements are subject to uncertainties. These statements are not guarantees of future performance and involve certain risks, uncertainties and probabilities. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they were made. HickoryTech undertakes no obligation to update any of its forward-looking statements, except as required by law.
| Consolidated Statement of Operations | ||||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended September 30 | % | Nine Months Ended September 30 | % | |||||||||||||||||||||||||
| (Dollars in thousands, except share data) | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||||||
| Revenue: | ||||||||||||||||||||||||||||
| Equipment | $ | 14,269 | $ | 9,954 | 43 | % | $ | 31,499 | $ | 27,906 | 13 | % | ||||||||||||||||
| Services | 30,975 | 33,526 | -8 | % | 92,475 | 92,562 | 0 | % | ||||||||||||||||||||
| Total revenue | 45,244 | 43,480 | 4 | % | 123,974 | 120,468 | 3 | % | ||||||||||||||||||||
| Costs and Expenses: | ||||||||||||||||||||||||||||
| Cost of sales, excluding depreciation and amortization | 12,223 | 8,519 | 43 | % | 27,146 | 23,968 | 13 | % | ||||||||||||||||||||
| Cost of services, excluding depreciation and amortization | 14,738 | 16,458 | -10 | % | 44,244 | 45,402 | -3 | % | ||||||||||||||||||||
| Selling, general and administrative expenses | 6,147 | 6,669 | -8 | % | 19,419 | 18,425 | 5 | % | ||||||||||||||||||||
| Depreciation | 5,706 | 5,356 | 7 | % | 16,890 | 15,900 | 6 | % | ||||||||||||||||||||
| Amortization of intangibles | 88 | 90 | -2 | % | 265 | 268 | -1 | % | ||||||||||||||||||||
| Total costs and expenses | 38,902 | 37,092 | 5 | % | 107,964 | 103,963 | 4 | % | ||||||||||||||||||||
| Operating income | 6,342 | 6,388 | -1 | % | 16,010 | 16,505 | -3 | % | ||||||||||||||||||||
| Interest and other income | 26 | 11 | 136 | % | 50 | 62 | -19 | % | ||||||||||||||||||||
| Interest expense | (1,487 | ) | (1,128 | ) | 32 | % | (3,570 | ) | (3,820 | ) | -7 | % | ||||||||||||||||
| Income before income taxes | 4,881 | 5,271 | -7 | % | 12,490 | 12,747 | -2 | % | ||||||||||||||||||||
| Income taxes | 1,910 | 228 | 738 | % | 4,683 | 2,767 | 69 | % | ||||||||||||||||||||
| Net income | $ | 2,971 | $ | 5,043 | -41 | % | $ | 7,807 | $ | 9,980 | -22 | % | ||||||||||||||||
| Basic earnings per share | $ | 0.22 | $ | 0.38 | -42 | % | $ | 0.58 | $ | 0.76 | -24 | % | ||||||||||||||||
| Basic weighted average common shares outstanding | 13,394,225 | 13,263,600 | 13,363,874 | 13,215,046 | ||||||||||||||||||||||||
| Diluted earnings per share | $ | 0.22 | $ | 0.38 | -42 | % | $ | 0.58 | $ | 0.76 | -24 | % | ||||||||||||||||
| Diluted weighted average common and equivalent shares outstanding | 13,409,414 | 13,264,996 | 13,376,261 | 13,217,325 | ||||||||||||||||||||||||
| Dividends per share | $ | 0.135 | $ | 0.13 | 4 | % | $ | 0.405 | $ | 0.39 | 4 | % | ||||||||||||||||
| Consolidated Balance Sheets | ||||||||||
| (unaudited) | ||||||||||
| (Dollars and Share Data in Thousands) | September 30, 2011 | December 31, 2010 | ||||||||
| Assets | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 11,316 | $ | 73 | ||||||
| Receivables, net of allowance for doubtful accounts of $405 and $570 | 34,664 | 24,642 | ||||||||
| Inventories | 5,924 | 5,205 | ||||||||
| Income taxes receivable | - | 3,814 | ||||||||
| Deferred income taxes | 2,008 | 2,008 | ||||||||
| Prepaid expenses | 2,506 | 2,026 | ||||||||
| Other | 829 | 1,030 | ||||||||
| Total current assets | 57,247 | 38,798 | ||||||||
| Investments | 4,224 | 4,512 | ||||||||
| Property, plant and equipment | 390,508 | 379,433 | ||||||||
| Accumulated depreciation | (238,070 | ) | (224,356 | ) | ||||||
| Property, plant and equipment, net | 152,438 | 155,077 | ||||||||
| Other assets: | ||||||||||
| Goodwill | 27,303 | 27,303 | ||||||||
| Intangible assets, net | 2,403 | 2,668 | ||||||||
| Deferred costs and other | 3,311 | 1,830 | ||||||||
| Total other assets | 33,017 | 31,801 | ||||||||
| Total assets | $ | 246,926 | $ | 230,188 | ||||||
| Liabilities and Shareholders' Equity | ||||||||||
| Current liabilities: | ||||||||||
| Extended term payable | $ | 12,631 | $ | 8,254 | ||||||
| Accounts payable | 3,718 | 2,840 | ||||||||
| Accrued expenses and other | 9,461 | 7,929 | ||||||||
| Accrued income taxes | 3,739 | - | ||||||||
| Deferred revenue | 6,049 | 5,073 | ||||||||
| Financial derivative instruments | - | 1,079 | ||||||||
| Current maturities of long-term obligations | 1,436 | 4,892 | ||||||||
| Total current liabilities | 37,034 | 30,067 | ||||||||
| Long-term liabilities: | ||||||||||
| Debt obligations, net of current maturities | 119,169 | 114,067 | ||||||||
| Accrued income taxes | 157 | 562 | ||||||||
| Deferred income taxes | 26,349 | 26,868 | ||||||||
| Deferred revenue | 1,195 | 1,397 | ||||||||
| Financial derivative instruments | 2,708 | - | ||||||||
| Accrued employee benefits and deferred compensation | 16,527 | 15,923 | ||||||||
| Total long-term liabilities | 166,105 | 158,817 | ||||||||
| Total liabilities | 203,139 | 188,884 | ||||||||
| Commitments and contingencies | ||||||||||
| Shareholders' equity: | ||||||||||
| Common stock, no par value, $.10 stated value | ||||||||||
| shares authorized: 100,000 | ||||||||||
| Shares issued and outstanding: 13,380 in 2011 and 13,299 in 2010 | 1,338 | 1,330 | ||||||||
| Additional paid-in capital | 15,187 | 14,328 | ||||||||
| Retained earnings | 32,242 | 29,841 | ||||||||
| Accumulated other comprehensive (loss) | (4,980 | ) | (4,195 | ) | ||||||
| Total shareholders' equity | 43,787 | 41,304 | ||||||||
| Total liabilities and shareholders' equity | $ | 246,926 | $ | 230,188 | ||||||
| Business Sector Recap | ||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| September 30 | % | September 30 | % | |||||||||||||||||||||
| (Dollars In thousands) | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
| Revenue before intersegment eliminations | ||||||||||||||||||||||||
| Equipment | $ | 14,269 | $ | 9,954 | 43 | % | $ | 31,499 | $ | 27,906 | 13 | % | ||||||||||||
| Support Services | 2,147 | 2,164 | -1 | % | 7,087 | 6,373 | 11 | % | ||||||||||||||||
| Equipment | 16,416 | 12,118 | 35 | % | 38,586 | 34,279 | 13 | % | ||||||||||||||||
| Fiber and Data | 11,368 | 13,257 | -14 | % | 33,296 | 33,578 | -1 | % | ||||||||||||||||
| Intersegment | 219 | 157 | 39 | % | 566 | 387 | 46 | % | ||||||||||||||||
| Total Business Sector revenue | $ | 28,003 | $ | 25,532 | 10 | % | $ | 72,448 | $ | 68,244 | 6 | % | ||||||||||||
| Total revenue before intersegment eliminations | ||||||||||||||||||||||||
| Unaffiliated customers | $ | 27,784 | $ | 25,375 | $ | 71,882 | $ | 67,857 | ||||||||||||||||
| Intersegment | 219 | 157 | 566 | 387 | ||||||||||||||||||||
| $ | 28,003 | $ | 25,532 | $ | 72,448 | $ | 68,244 | |||||||||||||||||
| Cost of sales | ||||||||||||||||||||||||
| (excluding depreciation and amortization) | 12,223 | 8,519 | 43 | % | 27,146 | 23,968 | 13 | % | ||||||||||||||||
| Cost of services | ||||||||||||||||||||||||
| (excluding depreciation and amortization) | 7,468 | 8,600 | -13 | % | 22,343 | 22,881 | -2 | % | ||||||||||||||||
| Selling, general and administrative expenses | 3,465 | 3,476 | 0 | % | 10,220 | 9,510 | 7 | % | ||||||||||||||||
| Depreciation and amortization | 1,671 | 1,535 | 9 | % | 4,952 | 4,305 | 15 | % | ||||||||||||||||
| Total costs and expenses | 24,827 | 22,130 | 12 | % | 64,661 | 60,664 | 7 | % | ||||||||||||||||
| Operating income | $ | 3,176 | $ | 3,402 | -7 | % | $ | 7,787 | $ | 7,580 | 3 | % | ||||||||||||
| Net income | $ | 1,890 | $ | 2,023 | -7 | % | $ | 4,631 | $ | 4,498 | 3 | % | ||||||||||||
| Capital expenditures | $ | 3,201 | $ | 4,830 | -34 | % | $ | 7,517 | $ | 10,801 | -30 | % | ||||||||||||
| Business Equipment Product Line | ||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| September 30 | September 30 | |||||||||||||||||||||||
| (Dollars in thousands) | 2011 | 2010 | % Change | 2011 | 2010 | % Change | ||||||||||||||||||
| Revenue before intersegment eliminations | ||||||||||||||||||||||||
| Equipment | $ | 14,269 | $ | 9,954 | 43 | % | $ | 31,499 | $ | 27,906 | 13 | % | ||||||||||||
| Support Services | 2,147 | 2,164 | -1 | % | 7,087 | 6,373 | 11 | % | ||||||||||||||||
| 16,416 | 12,118 | 35 | % | 38,586 | 34,279 | 13 | % | |||||||||||||||||
| Cost of sales | ||||||||||||||||||||||||
| (excluding depreciation and amortization) | 12,223 | 8,519 | 43 | % | 27,146 | 23,968 | 13 | % | ||||||||||||||||
| Cost of services | ||||||||||||||||||||||||
| (excluding depreciation and amortization) | 1,634 | 1,666 | -2 | % | 5,008 | 5,078 | -1 | % | ||||||||||||||||
| Selling, general and administrative expenses | 1,235 | 1,319 | -6 | % | 3,765 | 3,547 | 6 | % | ||||||||||||||||
| Depreciation and amortization | 74 | 120 | -38 | % | 213 | 270 | -21 | % | ||||||||||||||||
| Total costs and expenses | 15,166 | 11,624 | 30 | % | 36,132 | 32,863 | 10 | % | ||||||||||||||||
| Operating income | $ | 1,250 | $ | 494 | 153 | % | $ | 2,454 | $ | 1,416 | 73 | % | ||||||||||||
| Net income | $ | 744 | $ | 293 | 154 | % | $ | 1,458 | $ | 858 | 70 | % | ||||||||||||
| Capital expenditures | $ | 213 | $ | 78 | 173 | % | $ | 306 | $ | 212 | 44 | % | ||||||||||||
| Business Fiber and Data Product Line | ||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| September 30 | September 30 | |||||||||||||||||||||||
| (Dollars in thousands) | 2011 | 2010 | % Change | 2011 | 2010 | % Change | ||||||||||||||||||
| Revenue before intersegment eliminations: | ||||||||||||||||||||||||
| Services | $ | 11,368 | $ | 13,257 | -14 | % | $ | 33,296 | $ | 33,578 | -1 | % | ||||||||||||
| Intersegment | 219 | 157 | 39 | % | 566 | 387 | 46 | % | ||||||||||||||||
| 11,587 | 13,414 | -14 | % | 33,862 | 33,965 | 0 | % | |||||||||||||||||
| Cost of services | ||||||||||||||||||||||||
| (excluding depreciation and amortization) | 5,834 | 6,934 | -16 | % | 17,335 | 17,803 | -3 | % | ||||||||||||||||
| Selling, general and administrative expenses | 2,230 | 2,157 | 3 | % | 6,455 | 5,963 | 8 | % | ||||||||||||||||
| Depreciation and amortization | 1,597 | 1,415 | 13 | % | 4,739 | 4,035 | 17 | % | ||||||||||||||||
| Total costs and expenses | 9,661 | 10,506 | -8 | % | 28,529 | 27,801 | 3 | % | ||||||||||||||||
| Operating income | $ | 1,926 | $ | 2,908 | -34 | % | $ | 5,333 | $ | 6,164 | -13 | % | ||||||||||||
| Net income | $ | 1,146 | $ | 1,730 | -34 | % | $ | 3,173 | $ | 3,640 | -13 | % | ||||||||||||
| Capital expenditures | $ | 2,988 | $ | 4,752 | -37 | % | $ | 7,211 | $ | 10,589 | -32 | % | ||||||||||||
| Telecom Sector Recap | ||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| September 30 | % | September 30 | % | |||||||||||||||||||||
| (Dollars in thousands) | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
| Revenue | ||||||||||||||||||||||||
| Local Service | $ | 3,534 | $ | 3,832 | -8 | % | $ | 10,822 | $ | 11,528 | -6 | % | ||||||||||||
| Network Access | 5,512 | 5,812 | -5 | % | 17,088 | 17,791 | -4 | % | ||||||||||||||||
| Long Distance | 717 | 800 | -10 | % | 2,173 | 2,420 | -10 | % | ||||||||||||||||
| Broadband | 5,101 | 4,857 | 5 | % | 15,245 | 13,825 | 10 | % | ||||||||||||||||
| Directory | 845 | 912 | -7 | % | 2,563 | 2,717 | -6 | % | ||||||||||||||||
| Bill Processing | 1,330 | 1,148 | 16 | % | 2,917 | 2,725 | 7 | % | ||||||||||||||||
| Intersegment | 404 | 562 | -28 | % | 1,220 | 1,459 | -16 | % | ||||||||||||||||
| Other | 421 | 744 | -43 | % | 1,284 | 1,605 | -20 | % | ||||||||||||||||
| Total Telecom Revenue | $ | 17,864 | $ | 18,667 | -4 | % | $ | 53,312 | $ | 54,070 | -1 | % | ||||||||||||
| Total Telecom revenue before intersegment eliminations | ||||||||||||||||||||||||
| Unaffiliated Customers | $ | 17,460 | $ | 18,105 | $ | 52,092 | $ | 52,611 | ||||||||||||||||
| Intersegment | 404 | 562 | 1,220 | 1,459 | ||||||||||||||||||||
| 17,864 | 18,667 | 53,312 | 54,070 | |||||||||||||||||||||
| Cost of services, excluding depreciation and amortization | 7,844 | 8,539 | -8 | % | 23,540 | 24,252 | -3 | % | ||||||||||||||||
| Selling, general and administrative expenses | 2,919 | 3,185 | -8 | % | 9,035 | 9,168 | -1 | % | ||||||||||||||||
| Depreciation and amortization | 4,101 | 3,881 | 6 | % | 12,137 | 11,772 | 3 | % | ||||||||||||||||
| Total costs and expenses | 14,864 | 15,605 | -5 | % | 44,712 | 45,192 | -1 | % | ||||||||||||||||
| Operating income | $ | 3,000 | $ | 3,062 | -2 | % | $ | 8,600 | $ | 8,878 | -3 | % | ||||||||||||
| Net income | $ | 1,787 | $ | 1,818 | -2 | % | $ | 5,102 | $ | 4,998 | 2 | % | ||||||||||||
| Capital expenditures | $ | 2,440 | $ | 1,688 | 45 | % | $ | 6,615 | $ | 6,209 | 7 | % | ||||||||||||
Key Metrics | ||||||||||||||||||||||||
| Business access lines | 23,378 | 24,468 | -4 | % | ||||||||||||||||||||
| Residential access lines | 25,329 | 28,028 | -10 | % | ||||||||||||||||||||
| Total access lines | 48,707 | 52,496 | -7 | % | ||||||||||||||||||||
| Long distance customers | 32,730 | 34,459 | -5 | % | ||||||||||||||||||||
| DSL customers | 19,749 | 19,642 | 1 | % | ||||||||||||||||||||
| Digital TV customers | 10,503 | 10,301 | 2 | % | ||||||||||||||||||||
| Reconciliation of Non-GAAP Measures | ||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||
| Reconciliation of net debt: | Sept. 30, 2011 | June 30, 2011 | Dec. 31, 2010 | |||||||||||||
| Debt obligations, net of current maturities | $ | 119,169 | $ | 8,462 | $ | 114,067 | ||||||||||
| Current maturities of long-term obligations | 1,436 | 110,230 | 4,892 | |||||||||||||
| Total Debt | $ | 120,605 | $ | 118,692 | $ | 118,959 | ||||||||||
| Less: | ||||||||||||||||
| Cash and cash equivalents | 11,316 | 14,930 | 73 | |||||||||||||
| Net Debt | $ | 109,289 | $ | 103,762 | $ | 118,886 | ||||||||||
| Year Ending | ||||||||||||||||
| December 31, 2011 | ||||||||||||||||
| (Dollars in thousands) | Guidance Range | |||||||||||||||
| Reconciliation of net income to 2011 EBITDA guidance: | Low | High | ||||||||||||||
| Projected net income | $ | 9,300 | $ | 10,200 | ||||||||||||
| Add back: | ||||||||||||||||
| Depreciation and amortization | 22,700 | 23,000 | ||||||||||||||
| Interest expense | 4,700 | 4,800 | ||||||||||||||
| Taxes | 5,600 | 6,000 | ||||||||||||||
| Projected EBITDA guidance 1 | $ | 42,300 | $ | 44,000 | ||||||||||||
1 EBITDA, a non-GAAP financial measure, is as defined in our debt agreement | ||||||||||||||||
| Three months ended | ||||||||||||||||
| Sep-11 | Jun-11 | Mar-11 | Dec-10 | |||||||||||||
| (Dollars in thousands) | ||||||||||||||||
| Reconciliation of net income to EBITDA: | ||||||||||||||||
| Net income | $ | 2,971 | $ | 2,694 | $ | 2,142 | $ | 2,114 | ||||||||
| Add: | ||||||||||||||||
| Depreciation | 5,706 | 5,593 | 5,591 | 5,765 | ||||||||||||
| Amortization of intangibles | 88 | 89 | 88 | 89 | ||||||||||||
| Interest expense | 1,487 | 1,015 | 1,068 | 1,094 | ||||||||||||
| Taxes | 1,910 | 1,307 | 1,466 | 1,266 | ||||||||||||
| EBITDA | $ | 12,162 | $ | 10,698 | $ | 10,355 | $ | 10,328 | ||||||||
| Debt to EBITDA ratio | ||||||||||||||||
| Total outstanding debt as of September 30, 2011 | $ | 120,605 | ||||||||||||||
| EBITDA for the last (4) consecutive fiscal quarters as presented above | 43,543 | |||||||||||||||
| Debt to EBITDA ratio as of September 30, 2011 | 2.8 | |||||||||||||||
David Christensen, 507-387-3355
CFO
or
Jennifer Spaude, 507-386-3765
Investor Relations