Windstream Narrows Losses in 4Q, Fiscal Year - Southern Business Review

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Friday, March 15, 2019

Windstream Narrows Losses in 4Q, Fiscal Year

Windstream Holdings Inc. of Little Rock, now working through Chapter 11 bankruptcy, reported Friday a narrower net loss in its most recent quarter and fiscal year.


The telecommunications firm, whose stock is now trading over the counter after being delisted from the Nasdaq exchange last week, also touted a third straight quarter of more broadband customers, growth in SD-WAN and enterprise sales, and an improvement in adjusted operating income.


But total sales declined. For the fourth quarter, total revenue and sales were $1.39 billion, down from $1.5 billion in the fourth quarter last year. For 2018, total revenue and sales were $5.71 billion, down from to $5.85 billion in the previous year.


Windstream said its fourth-quarter net loss was $549 million, or $12.92 per share — an improvement from a net loss of $1.84 billion, or $51.28 per share, in the same quarter last year. For the full year, the company reported a net loss of $723 million, or $17.72 per share — better than the $2.12 billion net loss, or $62.66 per share, it reported in 2017.


"As we enter 2019, we will continue to focus on improving our sales productivity, reducing churn across all of our business units, improving the customer experience and maintaining our laser-focus on aggressive cost management and operational efficiencies," CEO Tony Thomas said in a news release. "We are confident we will emerge from the financial restructuring process as a healthier and even stronger company than we are today, and we are excited about the opportunities that lie ahead of us."

Windstream's bankruptcy filing was prompted by a federal court ruling that found the company's 2015 fiber and copper assets spinoff ran afoul of bond covenants. The ruling exposed Windstream to a $310 million judgment.


Windstream and the spinoff, Uniti Group of Little Rock, both postponed their quarterly financial reports as they worked through the implications of the ruling and Windstream's bankruptcy filing. Windstream has called the reorganization "a necessary step to address the financial impact" of the judge's decision and "the impact it would have on consumers and businesses across the states in which we operate." The company said it is continuing to operate normally while it works through bankruptcy.


On Friday, Windstream said ILEC Consumer and Small Business service revenues were $455 million in the fourth quarter, down 4 percent year-over-year, and $1.85 billion, down 5 percent from 2017, respectively.


Enterprise service revenues were $704 million in the fourth quarter, down 7 percent year-over-year, and $2.88 billion for the year — flat from 2017.


Wholesale service revenues were $175 million in the fourth quarter, down 7 percent year-over-year, and $722 million for the year, down 4 percent.


CLEC Consumer service revenues, which is mainly the EarthLink consumer Internet business, were $43 million in the fourth quarter, down 17 percent year-over-year, and $181 million for the year, up 3 percent from 2017. Windstream completed the sale of its CLEC Consumer business in December.