We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Frontier Communications (FTR) Q4 Loss Wider than Expected
Read MoreHide Full Article
Frontier Communications Corp. reported disappointing financial results in the fourth quarter of 2016. The company’s adjusted net loss was wider-than the Zacks Consensus Estimate and revenues also fell short of the mark.
On a GAAP basis, net loss in the reported quarter was $133 million or a loss of 12 cents per share compared with a net loss of $156 million or 14 cents per share in the prior-year quarter. However, quarterly adjusted (excluding special items) loss per share was 4 cents, a penny higher than the Zacks Consensus Estimate.
Total revenues increased a whopping 70.5% year over year to $2,409 million. The significant jump in revenues can primarily be attributable to the acquisition of certain wireline assets from Verizon Communications Inc. (VZ - Free Report) . However, the figure lagged the Zacks Consensus Estimate of $2,500.3 million.
Segment-wise, Customer revenue totaled $2,210 million, up a substantial 83.1% year over year while Switched access and subsidy revenues were $199 million, down 3.4% year over year. Within the Customer segment, voice services revenues totaled $774 million, climbing 60.6%, Data and Internet services revenues came in at $1,013 million, advancing 72%, video revenues were $365 million, soaring an astounding 414.1% and Other revenues totaled $58 million, down 10.8%. Category-wise Residential revenues were $1,196 million, up a massive 101.3% while Business revenues came in at $1,014 million, up 65.4%.
Operating income in the fourth quarter increased 40.1% year-over-year to $255 million. Quarterly operating expenses were $2,154 million, rising 75% year over year. Quarterly adjusted EBITDA was $966 million, up a considerable 61% year over year. However, adjusted EBITDA margin was 40% compared with 42.5% in the prior-year quarter.
In the fourth quarter of 2016, Frontier Communications generated $714 million of cash from operations compared with $341 million in the prior-year quarter. Free cash flow in the reported quarter was $316 million compared with $243 million in the year-ago quarter.
Liquidity
Frontier Communications exited 2016 with $522 million of cash and cash equivalents compared with $936 million at 2015-end. Total debt at the end of 2016 was $17,923 million compared with $15,892 million at the end of 2015. At 2016-end, the debt-to-capitalization ratio was 0.79 compared with 0.80 at the end of 2015.
Subscriber Statistics
As of Dec 31, 2016, the number of residential customers decreased 2.9% sequentially to 4,891,000. The average monthly residential revenue per customer was $80.33, down 2.5% sequentially. Residential customer monthly churn was 2.08%, remains flat sequentially. Business customers decreased 2.7%, sequentially to 502,000. The average monthly business revenue per customer was $665.04, down 0.05% sequentially. Frontier Communications had 4,271,000 high-speed broadband subscribers, down 2.1% sequentially and 1,419,000 video customers, down 5.6% sequentially.
Outlook
For 2017, Frontier Communications expects adjusted free cash flow in the range of $800 to $1,000 million. Capital expenditures will be in the $1,000 to $1,250 million range. Cash taxes will be $0 to $50 million.
Frontier Communications Corporation Price, Consensus and EPS Surprise
A Full-Blown Technological Breakthrough in the Making
Zacks’ Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Frontier Communications (FTR) Q4 Loss Wider than Expected
Frontier Communications Corp. reported disappointing financial results in the fourth quarter of 2016. The company’s adjusted net loss was wider-than the Zacks Consensus Estimate and revenues also fell short of the mark.
On a GAAP basis, net loss in the reported quarter was $133 million or a loss of 12 cents per share compared with a net loss of $156 million or 14 cents per share in the prior-year quarter. However, quarterly adjusted (excluding special items) loss per share was 4 cents, a penny higher than the Zacks Consensus Estimate.
Total revenues increased a whopping 70.5% year over year to $2,409 million. The significant jump in revenues can primarily be attributable to the acquisition of certain wireline assets from Verizon Communications Inc. (VZ - Free Report) . However, the figure lagged the Zacks Consensus Estimate of $2,500.3 million.
Segment-wise, Customer revenue totaled $2,210 million, up a substantial 83.1% year over year while Switched access and subsidy revenues were $199 million, down 3.4% year over year. Within the Customer segment, voice services revenues totaled $774 million, climbing 60.6%, Data and Internet services revenues came in at $1,013 million, advancing 72%, video revenues were $365 million, soaring an astounding 414.1% and Other revenues totaled $58 million, down 10.8%. Category-wise Residential revenues were $1,196 million, up a massive 101.3% while Business revenues came in at $1,014 million, up 65.4%.
Operating income in the fourth quarter increased 40.1% year-over-year to $255 million. Quarterly operating expenses were $2,154 million, rising 75% year over year. Quarterly adjusted EBITDA was $966 million, up a considerable 61% year over year. However, adjusted EBITDA margin was 40% compared with 42.5% in the prior-year quarter.
Frontier Communications currently carries a Zacks Rank #5 (Strong Sell). Frontier Communications faces intense competition from large telecom operators like AT&T Inc. (T - Free Report) and Comcast Corp. (CMCSA - Free Report) . Both the stocks currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cash Flow
In the fourth quarter of 2016, Frontier Communications generated $714 million of cash from operations compared with $341 million in the prior-year quarter. Free cash flow in the reported quarter was $316 million compared with $243 million in the year-ago quarter.
Liquidity
Frontier Communications exited 2016 with $522 million of cash and cash equivalents compared with $936 million at 2015-end. Total debt at the end of 2016 was $17,923 million compared with $15,892 million at the end of 2015. At 2016-end, the debt-to-capitalization ratio was 0.79 compared with 0.80 at the end of 2015.
Subscriber Statistics
As of Dec 31, 2016, the number of residential customers decreased 2.9% sequentially to 4,891,000. The average monthly residential revenue per customer was $80.33, down 2.5% sequentially. Residential customer monthly churn was 2.08%, remains flat sequentially. Business customers decreased 2.7%, sequentially to 502,000. The average monthly business revenue per customer was $665.04, down 0.05% sequentially. Frontier Communications had 4,271,000 high-speed broadband subscribers, down 2.1% sequentially and 1,419,000 video customers, down 5.6% sequentially.
Outlook
For 2017, Frontier Communications expects adjusted free cash flow in the range of $800 to $1,000 million. Capital expenditures will be in the $1,000 to $1,250 million range. Cash taxes will be $0 to $50 million.
Frontier Communications Corporation Price, Consensus and EPS Surprise
Frontier Communications Corporation Price, Consensus and EPS Surprise | Frontier Communications Corporation Quote
A Full-Blown Technological Breakthrough in the Making
Zacks’ Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>