Uniti loss at $4.5M in quarter

Infrastructure bill seen to aid firm

Uniti Group Inc. on Thursday reported a loss of $4.5 million in the first quarter ended March 31, an improvement over the loss of $80.3 million reported in the same quarter last year.

The communications company, which provides fiber to companies that deliver broadband and other high-speed data services, also reported a loss of 2 cents per share, falling well short of the 41 cents in earnings per share projected as the consensus from Zacks investment service.

Uniti had a per share loss of 41 cents in the first quarter of 2020. Revenue for the quarter increased to $272.6 million from $266.1 million a year ago.

The company is continuing to see “robust demand across all of its business segments,” President and Chief Executive Officer Kenny Gunderman said in a news release.

Uniti has solid fundamentals that position the company for growth, particularly as more service providers deploy fiber to the home and national wireless carriers launch 5G services across the nation. All those carriers rely on Uniti’s fiber backbone to deliver high-speed services to their customers.

“Fiber is the missioncritical connective tissue

for virtually all current and future broadband delivery,” Gunderman told analysts on a conference call Thursday afternoon.

Uniti’s network, which connects to 26,300 users who then connect to their customers to deliver broadband, supports all technology and is positioned to offer service to broadband providers and wireless carriers regardless of whether they are delivering broadband through a direct connection to the home or over wireless networks or cloud-based products.

Uniti has built out 7,000 new route miles of fiber over the past three years and Gunderman said that growth will continue. “We expect that number could potentially triple over the next three years,” he added.

The company has about $1 billion in contract value in its sales pipeline, which should lead to about $60 million in annual revenue, according to Ron Mudry, Uniti’s chief revenue officer.

“We believe our past success is indicative of our future potential,” Gunderman said. “We continue to see new demand from anchor customers as well as lease up success.”

As Congress debates President Joe Biden’s proposed $2 trillion investment in the nation’s infrastructure, Gunderman said Uniti will be a “derivative beneficiary” of the program.

“We’re very excited about the infrastructure bill,” Gunderman told the analysts.

The Little Rock company will not receive direct funding under the program though it will benefit as municipalities and broadband providers receive the stimulus aid to deliver high-speed internet to homes and businesses.

“We think that deployment is not competitive for us; it’s highly complementary,” Gunderman added.

Uniti remains on course to deliver earnings per share ranging from $1.61 to $1.65 for the year, Gunderman said.

Meanwhile, the company has refinanced debt to reduce interest expense and improve its financial flexibility, according to Gunderman, who said the company projects it will save $25 million in interest costs this year.