Shenandoah Telecommunications Company (NASDAQ:SHEN) announced its fourth quarter and full year financial and operating results on February 28, 2022. The telecom company, known as Shentel, provides broadband services. The company has high-speed, cable, fiber-optic, and fixed wireless networks available to customers throughout the Mid-Atlantic United States.
In 2021, the firm’s net income from continuing operations was $7.9 million, compared with $1.6 million in 2020. For 2021, earnings from continuing operations per diluted share was $0.16, whereas for 2020 it was just $0.03. One of the biggest highlights for the company was that revenue rose $24.5 million or 11.1% to $245.2 million, thanks to a 11.6% increase in Broadband and a 3.8% rise in Tower businesses. The company also sold its Wireless division in 2021, which contributed to earnings from discontinued operations per diluted share growth of 696.8% to $1976.
Adjusted EBITDA increased 17.8 percent to $65.7 million in 2021, mostly due to a substantial 17.1% drop in corporate costs as a result of cost-cutting efforts following the sale of wireless assets and operations, as well as the growth of 4.5 percent for the Broadband and 3.2 percent for the Tower segments.
President and CEO of Christopher E. French commented in a press release: “2021 was a transformative year in the history of Shentel as we successfully divested our Wireless business and scaled our fiber-to-the-home platform that we expect will provide sustainable growth for the next several years. We are off to a great start with our Fiber First growth strategy. Our fiber construction backlog has grown to over 255,000 passings, including our recent VATI grant award for 16,000 unserved homes. We are targeting a doubling of our Glo Fiber passings to 150,000 in 2022, passing more homes and businesses with fiber than our incumbent cable network by the end of 2023.”
Telecom companies have had a great few years, and Shentel is no different. The company has seen growth in earnings and revenue, as well as Adjusted EBITDA. Thanks to its strong performance, the company has been able to pay down debt and return good value to shareholders.
One of the biggest shifts in the industry has been the new universality of fiber-optic networks. Fiber-optics offer much higher speeds than traditional copper networks, and as a result, companies like Shentel have been upgrading their infrastructure to stay ahead of the curve. This has been a big investment for the company, but one that is clearly paying off.
The other big development in the telecom world has been the rise of 5G. 5G offers much higher speeds than traditional copper networks as well. This shift has also given companies the opportunity to raise margins as the new services often come in at higher price points.
