FTRCQ Frontier Communications Corporation Class B

Frontier Communications Expands Broadband to Approximately 6,900 Additional North Carolina, South Carolina and Tennessee Rural Households

Frontier Communications (NASDAQ: FTR) announced that it has made enhanced broadband service available to an additional 6,900 households in rural communities in North Carolina, South Carolina and Tennessee. Frontier is leveraging the FCC's Connect America Fund (CAF) program to bring broadband to approximately 3,400 households in CAF-eligible census blocks while expanding its overall service and reach to 3,500 more households.

"Through ongoing network investments, Frontier is providing broadband and faster speeds to residents in our service areas," Melanie Williams, Frontier’s Senior Vice President of Operations, Southeast area, said. "We have been aggressively deploying and upgrading our broadband service and look forward to serving more residents."

The deployments are possible through a combination of Frontier's capital investment and the CAF. The FCC established the CAF in 2011 to facilitate broadband deployment to the millions of Americans living in rural areas without access to broadband infrastructure. As of 2016, Frontier began receiving approximately $8.4 million a year from the CAF to expand and upgrade the company's network to more than 25,000 locations in North Carolina, South Carolina and Tennessee by the end of 2020.

The CAF program and investments by Frontier are enabling broadband access to previously unserved households, as well as improvements in speeds and services. Representative counties in this latest round include households in Cashiers, Cherokee, Franklin and Hayesville in North Carolina; Georgetown and Johnsonville in South Carolina; and Weakley and Putnam in Tennessee. Frontier offers simplified broadband offerings and bundled service packages that provide customers with choice and affordable options.

Broadband availability allows businesses and consumers to stay connected and take full advantage of online education, healthcare, and entertainment options.

"Broadband connectivity is critical today, especially in more rural areas," said Williams. "Through investment and ongoing enhancements, Frontier is helping to close America's digital divide."

About Frontier Communications

Frontier Communications Corporation (NASDAQ: FTR) is a leader in providing communications services to urban, suburban, and rural communities in 29 states. Frontier offers a variety of services to residential customers over its fiber-optic and copper networks, including video, high-speed internet, advanced voice, and Frontier Secure® digital protection solutions. Frontier Business Edge™ offers communications solutions to small, medium, and enterprise businesses. More information about Frontier is available at www.frontier.com.

Please note that Frontier has a new logo that is available for download at our Press Room.

EN
23/05/2017

Underlying

Reports on Frontier Communications Corporation Class B

Vikash Harlalka
  • Vikash Harlalka

FYBR Quick Hit: ABS debt priced

Frontier announced pricing for its latest ABS debt this afternoon, raising $750MM. The offering consists of $530MM Class A-2 notes at 6.2%, $73MM Class B notes at 7.0%, and $147MM Class C notes at 11.2%. The average cost of debt is 7.4%, which is in-line with our expectation, and ~140bps lower than their last ABS debt issuance. These new tranches of debt have an anticipated repayment period of 7 years (vs. 5 years on the last issuance).

Jonathan Chaplin
  • Jonathan Chaplin

FYBR: Cash flow in steady state

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Jonathan Chaplin
  • Jonathan Chaplin

ACP Part V: FCC releases survey results

The FCC released a survey that included more than 5,000 ACP households today. The FCC repeated the mistake of prior surveys by asking whether households were new to broadband with ACP as opposed to subscribers that are new to broadband with one of the subsidy programs that followed the pandemic (stimulus checks; EBB; ACP). They also asked the important question, which is “what will you do when ACP ends”. Our quick analysis here focuses mostly on the social costs of ACP going away. We will ...

Jonathan Chaplin
  • Jonathan Chaplin

FYBR: updating capex and funding through 2026

The Company’s new Capex disclosure provides a clear map for cash capex for the fiber project for the remainder of the 10MM location plan, which will take them into 2026. Stronger confidence in the capex trajectory for the next three years lends confidence to the FCF trajectory and funding requirements (we have eliminated a variable). This should make it easier for investors on the sidelines to underwrite the investment case.

Jonathan Chaplin
  • Jonathan Chaplin

Frontier Model Update

This note focuses on changes to the model following 4Q23 results. Earlier today, we published a review of results and additional thoughts following the earnings call. Our net adds, revenue and EBITDA are slightly higher. Capex and FCF burn are also higher. Our long-term thesis remains unchanged. Price target is $54.

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