EDINBURG, Va., Nov 04, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- Shenandoah Telecommunications Company (Shentel) (Nasdaq: SHEN) announced financial and operating results for the third quarter and nine months ended September 30, 2008.

    Third Quarter 2008 Highlights
    Highlights for the quarter include:
    -- PCS net subscriber additions of 5,380 bringing the total retail
       wireless customers to 205,777 at September 30, 2008, up 16% from
       September 30, 2007
    -- Net income from continuing operations of $7.4 million, up 23% from
       third quarter 2007
    -- Net income of $6.8 million, up $1.7 million or 33% from third quarter
       2007
    -- Operating income of $12.6 million, up $2.9 million or 30% from the
       third quarter 2007
    -- Total revenues of $37.4 million, up $4.8 million or 15% from third
       quarter 2007
    -- PCS customer churn of 1.85%, in comparison to the 2.28% for the third
       quarter of 2007
    -- EVDO high speed data services are now available to 68% of the
       population covered by our PCS network

President and CEO, Christopher E. French commented, "Our Company delivered solid performance improvements in the third quarter despite the economic environment. We are pleased with the progress we made to expand our PCS network and offer further data and push to talk services."

Consolidated Results

For the quarter ended September 30, 2008, net income from continuing operations was $7.4 million compared to $6.1 million in third quarter 2007. The Company's total revenues for third quarter 2008 were $37.4 million, compared to $32.7 million for the same quarter in 2007, an increase of 15%. Third quarter operating expenses increased to $24.8 million in 2008 from $22.9 million in 2007. The increase in revenues is primarily a result of a larger base of PCS subscribers, while the increase in operating expenses results from costs associated with improving and expanding our PCS network. Operating income for the quarter was $12.6 million, an increase of $2.9 million from third quarter 2007.

In September, the company announced its plans to explore options for the sale of its Converged Services segment. The results of this segment are now considered a discontinued operation. This segment generated a net loss of $0.6 million for the quarter, an improvement from the $1.0 million net loss for the same quarter in 2007.

PCS Operating Results

The Company continued to experience strong growth in wireless as a Sprint PCS Affiliate of Sprint Nextel, with wireless customer count at September 30, 2008 of 205,777, a 16% increase from September 30, 2007. The Company's third quarter churn was 1.85%, compared to 2.28% in third quarter 2007.

PCS operating income was $9.6 million in the 2008 third quarter, up $2.7 million or 40% from the corresponding 2007 period. Revenue increased $4.1 million, while operating expenses increased $1.4 million. The increase in revenue resulted from a 16% increase in average retail customers. The increase in operating expenses included an additional $0.9 million in costs to operate the PCS network related to adding cell sites and EVDO capabilities. The Company added 14 additional cell sites and 41 EVDO sites during the quarter. The Company now has 134 EVDO sites covering 68% of covered POPs.

Telephone Operating Results

Telephone line losses continued to be lower than most wireline carriers. Telephone had 24,193 access lines at September 30, 2008, a decrease of 343 from the previous year-end. Operating income of the local telephone operations for third quarter 2008 was $3.4 million, an increase of $0.1 million from the comparable 2007 period.

Other Information

The Company's third quarter 2008 capital expenditures were $20.2 million, up from $9.3 million in third quarter 2007, and for the nine month period, were $38.9 million compared to $18.1 million in 2007. The increase in capital expenditures primarily resulted from spending to expand our PCS network coverage and footprint. The Company expects capital spending to remain elevated for the next several quarters. Cash and cash equivalents as of September 30, 2008 were $7.3 million, down from $17.2 million at December 31, 2007. The Company retired $1.1 million of debt during the third quarter, and at September 30, 2008, the debt/equity ratio was 0.11; and debt as a percent of total assets was 7.9%. As previously announced, on December 1, 2008, the Company will pay a cash dividend of 30 cents per share to shareholders of record as of November 12, 2008.

About Shenandoah Telecommunications

Shenandoah Telecommunications Company is a holding company that provides a broad range of telecommunications services through its operating subsidiaries. The Company is traded on the NASDAQ Global Select Market under the symbol "SHEN." The Company's operating subsidiaries provide local and long distance telephone, Internet and data services, cable television, wireless voice and data services, alarm monitoring, and telecommunications equipment, along with many other associated solutions in the Mid-Atlantic and Southeastern United States.

This release contains forward-looking statements that are subject to various risks and uncertainties. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of unforeseen factors. A discussion of factors that may cause actual results to differ from management's projections, forecasts, estimates and expectations is available in the Company filings with the SEC. Those factors may include changes in general economic conditions, increases in costs, changes in regulation and other competitive factors.

    SHENANDOAH TELECOMMUNICATIONS COMPANY
    SUMMARY FINANCIAL INFORMATION (unaudited)
    (In thousands)

    Condensed Consolidated Balance Sheets          September 30,  December 31,
                                                       2008           2007

    Cash and cash equivalents                         $7,318       $ 17,245
    Assets held for sale                              27,178              -
    Other current assets                              31,612         23,891
    Investments                                        8,877          9,936

    Property, plant and equipment                    301,678        300,622
      Less accumulated depreciation and amortization 145,267        145,198
    Net property, plant and equipment                156,411        155,424

    Other assets, net                                  5,518         15,028
      Total assets                                  $236,914       $221,524

    Current liabilities, exclusive of current
     maturities of long-term debt of $4,360
     and $4,248, respectively                        $18,882        $19,808
    Long-term debt, including current maturities      18,735         21,907
    Total other liabilities                           28,606         28,685
    Total shareholders' equity                       170,691        151,124
      Total liabilities and shareholders' equity    $236,914       $221,524



    SHENANDOAH TELECOMMUNICATIONS COMPANY
    SUMMARY FINANCIAL INFORMATION (unaudited)
    (In thousands, except per share amounts)

    Condensed Consolidated Statements of Income

                                 Three months ended       Nine months ended
                                    September 30,            September 30,
                                  2008        2007         2008        2007

    Revenues                    $37,409      $32,655     $107,304    $95,755

    Cost of goods and
     services                    10,662        9,986       31,244     29,075
    Selling, general and
     administrative               7,724        6,834       21,052     20,003
    Depreciation &
     amortization                 6,424        6,113       19,127     17,468
    Operating expenses           24,810       22,933       71,423     66,546
    Operating income             12,599        9,722       35,881     29,209

    Interest expense               (103)        (453)        (782)    (1,433)
    Other income (expense), net    (234)         733         (109)     1,800
    Income from continuing
     operations before
     income taxes                12,262       10,002       34,990     29,576

    Income tax expense            4,818        3,929       14,013     11,855
      Net income from
       continuing
       operations                $7,444       $6,073      $20,977    $17,721
    Loss from discontinued
     operations, net of
     taxes                         (636)        (966)      (2,128)    (2,596)
    Net income                   $6,808       $5,107      $18,849    $15,125


    Net income per share,
     basic and diluted            $0.29        $0.22        $0.80      $0.65

SOURCE Shenandoah Telecommunications Company

http://www.shentel.com

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