8-K
Uniti Group Inc. (UNIT)
View as plain text
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
February 20, 2025
Windstream Parent, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 333-281068 | 99-2892631 |
|---|---|---|
| (State or other jurisdiction | (Commission | (I.R.S. Employer |
| of incorporation) | File Number) | Identification No.) |
| 4005 Rodney Parham Road, Little Rock, Arkansas | 72212 | |
| --- | --- | |
| (Address of principal executive<br> offices) | (Zip Code) |
(501) 748-7000
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act: None
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 7.01 Regulation FD Disclosure
On February 20, 2025, Windstream Holdings II, LLC (the “Company”) will hold a management call to discuss the financial and operating results of the Company for the fourth quarter ended December 31, 2024. Copies of the Investor Presentation, Earnings Call Prepared Remarks, CEO Letter and Fact Sheet are attached hereto as Exhibit 99.1, Exhibit 99.2, Exhibit 99.3 and Exhibit 99.4, respectively, and are incorporated herein by reference.
The information furnished under Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, Exhibit 99.2, Exhibit 99.3 and Exhibit 99.4 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 9.01 Financial Statements and Exhibits
Exhibits
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Windstream<br>Parent, Inc. | |||
|---|---|---|---|
| Date: February 20, 2025 | By: | /s/ Drew Smith | |
| Name: | Drew Smith | ||
| Title: | Chief Financial Officer and Treasurer |
Exhibit 99.1
| 4Q24 Financial Earnings<br>February 20, 2025 |
|---|
| 2<br>This presentation includes forward-looking statements that are subject to risks and uncertainties that could cause actual future events and results to differ materially from those<br>expressed in the forward-looking statements. Forward-looking statements are typically identified by words or phrases such as “will,” “anticipate,” “estimate,” “expect,” “project,”<br> “intend,” “plan,” “believe,” “target,” “forecast” and other words and terms of similar meaning.<br>Forward-looking statements include, but are not limited to, guidance regarding 2025 financial and operational results and our ability to execute our 2025 strategic goals supporting<br>the guidance, including the planned acceleration of our fiber deployment and our ability to increase our fiber penetration; the number of households or locations that we may be able<br>to serve generally and related to funding from various current or future state and federal broadband programs, public-private partnerships with government entities, the Rural Digital<br>Opportunity Fund, and the BEAD program; opportunities related to strategic sales, products, and strategic revenue growth across our business units; expectations regarding<br>expense management activities, and the timing and benefit of such activities; statements regarding possible benefits and opportunities related to the proposed transaction with<br>Until Group, Inc., announced publicly in May 2024; and any other statements regarding plans, objectives, expectations and intentions and other statements that are not historical<br>facts. These statements, along with other forward-looking statements regarding Windstream’s overall business outlook, are based on estimates, projections, beliefs, and assumptions<br>that Windstream believes are reasonable but are not guarantees of future events, performance, or results. Actual future events and results may differ materially from those<br>expressed in these forward-looking statements as the result of a number of important factors.<br>Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include risks and uncertainties relating to increased<br>competitive pressures as state and federal broadband funding programs provide opportunities for new entrants in our markets, or prefer municipal cooperatives, leading to possible<br>overbuilding of our network; our ability to, and the extent to which, we participate in broadband funding programs, such as BEAD, and are able to successfully secure funding via<br>competitive bidding processes over competitors; the uncertainty surrounding the BEAD program in light of increased focus on the program by members of the federal legislative<br>and executive branches, including changes to the program, timing of implementation of the program or in what form the program continues; the effect of any changes in federal or<br>state governmental regulations or statutes or new requirements or restrictions contained in executive orders that could impact our business or the business of our customers;<br>uncertainty created in the federal Universal Service Fund program based on the pending legal case at the U.S. Supreme Court, including possible impact on future funding under the<br>Rural Digital Opportunity Fund; increased oversight or enforcement activities by state or federal agencies, particularly based on our status as a federal and state government<br>contractor; that the proposed transaction with Uniti Group, Inc., could cause distraction by management and an allocation of resources that otherwise would have been attributed to<br>the business; risks and uncertainties from cost pressures, tariffs, trade disputes, or inflation on our business or on our customers’ communications and payment decisions and on the<br>business of our vendors; adverse economic, political or market conditions related to foreign wars or unrest, political upheaval epidemics, pandemics, or disease outbreaks, and the<br>impact of these conditions on our business operations and financial position and on our customers; any supply chain impact from tariffs or trade disputes on our vendors that may<br>impact our business operations and our customers’ ability to operate their business; that the expected benefits of cost and expense management activities are not realized or<br>adversely affect our sales and operations or are otherwise disruptive to our business and personnel; the impact of new, emerging, or competing technologies and our ability to utilize<br>these technologies to provide services to our customers; and general U.S. and worldwide economic conditions and related uncertainties. Windstream does not undertake any<br>obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. |
| --- |
| 3<br>Paul Sunu<br>Chief Executive Officer<br>Drew Smith<br>Chief Financial Officer<br> & Treasurer<br>Genesis White<br>VP, Investor Relations<br> & Assistant Treasurer |
| --- |
| 4<br> &<br> Announced Merger with Uniti, bringing the network and operations back together and<br>creating further opportunities to accelerate growth<br> Completed multiple refinancing transactions that improved Windstream's debt<br>maturity profile by several years and funded our expanded build plan in 2025<br> Achieved Adjusted EBITDAR and Free Cash Flow Guidance<br> Increased fiber coverage by 11% year-over-year, resulting in 1.6 million consumer<br>premises passed and representing 37% fiber coverage of our Kinetic markets<br> Grew Fiber Subscribers by 16% year-over-year, resulting in approximately 450K fiber<br>customers and 27% fiber penetration<br> Continued execution of our Enterprise transformation strategy, which is shifting away<br>from legacy revenues and towards our Strategic and Advanced IP Products, which now<br>represent 91% of Enterprise Service Revenues(1)<br> Generated solid Wholesale strategic revenue performance highlighted by high demand<br>from carriers, content providers and hyperscalers<br>(1) Excludes end-user surcharges and is based on 4Q24 results on an annualized basis. |
| --- |
| 5<br>Consumer Fiber Expansion<br>(1 Gbps Consumer Premises Passed by Type)<br>Extending our Fiber Coverage<br> 167K new consumer premises added in 2024<br> 37% coverage of consumer households was<br>achieved by year end<br>(1) Calculated using Fiber Subscriber revenue, less standard modem rental charge of $10.99 per month.<br>2022 2023 2024<br>Strategic<br>PPP<br>RDOF<br>Consumer Fiber Subscribers Consumer Fiber Revenue and ARPU<br>1,626<br>1,237<br>1,459<br>287<br>383<br>446<br>23.2%<br>26.3%<br>27.4%<br>2022 2023 2024<br>Ending Fiber Subscribers<br>Penetration Rate<br>$201<br>$321<br>$408<br>$63.39<br>$68.74<br>$71.07<br>2022 2023 2024<br>Fiber Subscriber Revenue<br>Fiber ARPU(1)<br>Fiber Broadband Adds Continue<br> Ended year with 446K consumers on 1G capable<br>facilities, up 62K from 2023<br> Fiber penetration of 27.4%, an improvement of 110<br>basis points year-over-year<br>Strong Fiber Revenue and ARPU Trends<br> Fiber Subscriber Revenue grew 27% year-over-year<br>driven by strong adoption of our FTTH facilities<br> Fiber ARPU of $71.07 grew 3% year-over-year |
| --- |
| 18%<br>25%<br>28%<br>24%<br>29%<br>26%<br>2021 2022 2023<br>Newest Fiber Cohorts Are Showing Strong Penetration Early<br>Note: Cohort penetration reflects consumers on 1G capable facilities, within the respective cohort, at the 12-month (Year 1 Penetration), 24-month (Year 2 Penetration), and 36-month (Year 3 Penetration)<br>anniversary of the cohort being launched summarized by year.<br>Cohort Penetration Through Year 3<br>6<br>Year 1 Penetration<br>Year 2 Penetration<br>Year 3 Penetration<br>40%<br>Target Penetration<br>Over a 4 Year Period<br>Performance from<br>program is driving strong<br>results in newer cohorts<br>initiative launched in 2024,<br>with further scaling in<br>2025, is reinvigorating<br>penetration progress in our<br>older cohorts |
| --- |
| 7<br>Be the PREMIER<br>broadband provider<br>Be the INNOVATIVE<br>wholesale leader<br>OPERATIONS & SUPPORT<br>Be the unwavering foundation that aligns, nurtures and enables us to be our best<br>Focus o<br>diversity<br>and<br>inclusion<br>Forge Ahead<br>With Fiber<br>Fortify Our<br>High-Quality Focus<br>Foster Healthy<br>Customer Connections<br>Pave the way for<br>future generations to<br>thrive in a digital world<br>Meet evolving customer<br>needs and capture<br>greater market share<br>Develop stronger<br>customer relationships<br>(inside and outside)<br>founded on trust and<br>driven by collaboration |
| --- |
| 1.2M<br>1.5M<br>1.6M<br>2.0M<br>2022A 2023A 2024A 2025E<br>+15%<br>CAGR<br>8<br>287K<br>383K<br>446K<br>~550K<br>2022A 2023A 2024A 2025E<br>+25%<br>CAGR<br>28% Fiber<br>Penetration<br>Accelerate fiber deployment to reach 43% coverage and<br>improve fiber penetration to 28%<br>Consumer Fiber Premises Passed Consumer Fiber Subscribers<br>IN 2025 WE WILL:<br>43% Fiber<br>Coverage |
| --- |
| Financial Overview 2023 2023 2023 2023 2023 2024 2024 2024 2024 2024<br>Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE<br> Revenue and Sales<br>Kinetic Market $ 536 $ 537 $ 530 $ 540 $ 2,143 $ 547 $ 529 $ 512 $ 503 $ 2,091<br>Enterprise Market 371 338 346 314 1,369 316 287 279 261 1,143<br>Wholesale Market 113 106 115 103 437 114 100 112 102 428<br>Service Revenue $ 1,019 $ 980 $ 991 $ 958 $ 3,948 $ 977 $ 916 $ 903 $ 866 $ 3,661<br>Product & Fiber Sales 8 11 11 9 39 24 11 13 9 57<br>Total Revenue and Sales $ 1,027 $ 991 $ 1,002 $ 967 $ 3,987 $ 1,001 $ 926 $ 916 $ 875 $ 3,718<br>Expenses<br>Direct Segment Expenses $ 363 $ 358 $ 363 $ 337 $ 1,421 $ 343 $ 326 $ 321 $ 317 $ 1,308<br>Network Access & Facilities 132 129 127 118 505 111 109 105 101 426<br>Shared Network & Operations 79 75 75 72 302 70 64 66 65 264<br>Information Techology/Shared Corporate 73 69 68 60 271 71 65 64 64 264<br>Total Expenses $ 647 $ 631 $ 632 $ 588 $ 2,499 $ 595 $ 565 $ 556 $ 547 $ 2,262<br>Adjusted EBITDAR $ 380 $ 360 $ 370 $ 379 $ 1,488 $ 406 $ 362 $ 361 $ 328 $ 1,457<br>Adjusted EBITDAR Margin % 37.0% 36.3% 36.9% 39.2% 37.3% 40.6% 39.1% 39.4% 37.5% 39.2%<br>(Dollars in Millions)<br>9<br>(1) 1Q24 and 4Q24 Adjusted EBITDAR excluding gain on sale of IPv4 assets<br>(1) |
| --- |
| $0 $0 $…<br>$0<br>$2,200<br> $-<br> $500<br> $1,000<br> $1,500<br> $2,000<br> $2,500<br> $3,000<br> $3,500<br>2025 2026 2027 2028 2029 2030 2031<br>$475<br>Debt Maturity as of November 10, 2022<br>Revolver Draw<br>Note: Available capacity under credit facility excludes outstanding letters of credit of $184 million of which $152.5 million was issued to Universal Service Administrative Company as a condition for Windstream receiving RDOF funding<br>Effective September 21, 2024, the borrowing capacity under the credit facility decreased from $500 million to $475 million.<br>Net Liquidity<br>Net Debt to<br>Adjusted EBITDA<br>10<br>Undrawn Revolver Term Loan 8.25% Sr First Lien Notes<br>Ended 4Q with<br>and<br>$500<br>Debt Maturity as of December 31, 2024 |
| --- |
| 11<br>(all $ in millions) 2024 Results 2025 Guidance<br>Adjusted EBITDAR(1) $1,457M Approximately $1.4B<br>Cash Interest $207M Approximately $230M<br>Capex $884M Approximately $1.1B<br>Kinetic Consumer Subscriber Revenue (2.9%) Low-single digit growth y/y<br>(1) Excluding impact of non-core operating asset sales during the period. |
| --- |
| Quarterly supplemental schedules (Pro Forma)<br>Appendix<br>12 |
| --- |
| 13 |
| --- |
| 14 |
| --- |
| 15 |
| --- |
| 16 |
| --- |
| 17 |
| --- |
| 18 |
| --- |
| 19 |
| --- |
| 20 |
| --- |
Where to Find Additional Information
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation material in respect of the proposed merger between Windstream and Uniti (the “proposed transaction”). In connection with the proposed transaction, Windstream filed a registration statement on Form S-4, containing a proxy statement/prospectus, with the SEC on February 12, 2025 and Uniti filed a proxy statement with the SEC on February 12, 2025. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders are able to obtain copies of the registration statement and proxy statement/prospectus (when available) as well as other filings containing information about Windstream and Uniti, without charge, at the SEC’s website, http://www.sec.gov. Copies of the registration statement and proxy statement/prospectus and each company’s other filings with the SEC may also be obtained free of charge from the respective companies. Copies of documents filed with the SEC by Windstream will be made available free of charge on Windstream’s investor relations website at https://investor.windstream.com/. Copies of documents filed with the SEC by Uniti will be made available free of charge on Uniti’s investor relations website at https://investor.uniti.com/.
Participants in the Solicitation
Windstream and Uniti and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about the directors and executive officers of Uniti is set forth in its definitive proxy statement, which was filed with the SEC on February 12, 2025. Investors may obtain additional information regarding the interests of such participants by reading the registration statement, proxy statement/prospectus and other relevant materials regarding the proposed transaction.
Exhibit 99.2
Windstream 4Q24 EarningsCall – Prepared Remarks
February 20, 2025
Genesis White
Good morning everyone and thank you for joining Windstream’s fourth quarter 2024 earnings conference call.
Joining me on the call today are:
· Paul Sunu, our CEO, and
· Drew Smith, our CFO and Treasurer
To accompany today’s call, we have posted the presentation slides and supplemental schedule on our various investor websites. If you do not have access to these websites, please reach out to me at Genesis dot White at windstream dot com.
Our financial statements, prepared in accordance with U.S. GAAP, will be available by mid-March to our lenders and investors, in compliance with the terms of the Credit Agreement, Indenture, and Amended and Restated LLC Agreement.
Today’s discussion includes statements about expected future events and financial results that are forward -looking and subject to risks and uncertainties and the disclosure to our forward -looking statements will be contained in our financial statements. Let me now turn it over to Paul Sunu.
Paul Sunu
Good morning and thank you for joining us.
Today, we are pleased to share with you our 2024 results, which showed solid financial and operational performance across our business.
In 2024 we embraced and instilled quality into every element of our operations from construction to installation to repair and care.
And through it we brought greater customer satisfaction and increased operational productivity while seeing meaningful reductions in churn and call center volumes.
Further, in advance of accelerating and expanding our fiber builds, we elevated the skills of our technicians, and local managers, and promoted a culture of assuring quality with every installation and every repair.
With that, allow me to share a few highlights of our full year results.
As seen on Slide 4, Windstream executed on its key priorities in 2024.
We enhanced our strategic profile by bringing our network back with our operations through the announced merger with Uniti.
Further, through multiple refinancing transactions, we improved our debt maturity profile and added the required liquidity to fully fund our enhanced build plan for 2025.
And through operational effectiveness we achieved our strategic priorities and financial guidance for the year.
Within Kinetic, we increased our fiber coverage and grew our fiber subscribers year-over-year, highlighting our continued commitment to extending our fiber footprint within Kinetic’s markets.
Enterprise and Wholesale continued their solid performance.
Inside Enterprise, our Strategic and Advanced IP portfolio revenues reached 91% of our total Enterprise Market service revenues on an annualized basis, excluding end-user surcharges.
Windstream Wholesale continues to demonstrate its market leadership in innovation with the first ever 800G transatlantic connection. Furthermore, Wholesale’s core fiber transport service continues to resonate with carriers, content providers and hyperscalers.
Slide 5 provides a bit more insight into Kinetic’s Fiber performance for the year.
We extended our fiber coverage by passing an additional 167,000 consumer premises during the year, or growth of 11% year-over-year, bringing our total to over 1.6 million consumer premises passed or 37% of Kinetic’s footprint.
While we made great strides in extending our fiber reach during the year, we experienced an unusual series of devasting natural disasters in our service territories—including tornados, wildfires and back-to-back Hurricanes.
These events required us to redirect resources towards recovery and restoration efforts in the back half of the year, impacting operational trends in the fourth quarter.
Our priority is the safe and complete restoral of services for our customers and the communities we serve.
And so, I am happy to say that we have substantially completed all restoration and clean-up efforts, and the team is now poised and sharply focused on executing on our 2025 priorities.
Now let’s take a look at our fiber subscriber growth.
Despite a slow-down in the fourth quarter from the impact of the afore-mentioned storms, our fiber subscribers grew 16% year-over-year and fiber subscriber revenue grew 27% for the same period, demonstrating strong adoption of our fiber product.
We ended the year with approximately 450,000 subscribers on our fiber network, representing a 27.4% penetration rate, an improvement of 110 basis points year-over-year.
Additionally, you can see the performance of our Fiber Fast Start initiative on Slide 6, as our latest cohorts continue to show impressive penetration results.
Furthermore, we launched our Fiber Forward initiative during the second quarter, which leverages the tactics and learning from Fiber Fast Start to reinvigorate our older cohorts. While this program is still ramping, we are seeing encouraging improvements in the markets launched, including as much as a 50% increase in sales.
These indicators are a positive sign, and to further drive penetration in our older cohorts, we intend to apply this initiative to nearly three times the number of households in 2025.
Overall, I am quite pleased with our performance in 2024.
We demonstrated continued momentum across our strategic initiatives, as well as operational improvements generated from our quality focus, all of which serves as a solid platform for executing on our 2025 initiatives.
Now, slide 7 shows our 2025 priorities.
We plan to build more fiber to meet the growing demands in our residential, business, and wholesale markets.
Looking at slide 8, our plan is to nearly double the rate of our fiber builds in 2025, compared to what was completed last year.
This will result in about 2 million consumer premises passed, or 43% coverage of our Kinetic footprint, by the end of this year.
The ramp in our internal construction hiring, the increased training and adherence to our quality standards, along with the additional funding from our recent refinancing activities, all contribute to facilitating the execution of our 2025 vision to accelerate fiber deployment.
In addition, through the demonstrated successes of our fiber fast start and fiber forward initiatives, we expect to drive increased penetration in our fiber markets.
Additionally, we want to more effectively mine the high-margin, on-net businesses in our Kinetic markets.
We believe that utilizing the go to market expertise, as well as the products and services, of our Enterprise team can generate the momentum for growth in this area.
At the same time, we have entrusted the care of our valuable base of Enterprise customers to a select team of skilled professionals.
And finally, before we get to our financial results, let me address the progress on our planned merger with Uniti.
We have now received sixteen state approvals and have two state approvals in process.
In addition, the SEC completed its review of the Form S-4 earlier this month and the Registration Statement has now been declared effective.
We defer to Uniti management on specifics of the transaction and next steps in the closing process.
We still expect the merger to close in the second half of 2025, subject to customary closing conditions, including receipt of regulatory and Uniti shareholder approvals.
In the meantime, we remain steadfast in executing on our 2025 priorities, delivering high-quality service to our customers and driving growth.
With that, let me turn the call over to Drew to cover our financial highlights for the quarter, as well as our 2025 financial and operational guidance.
Drew Smith
Thank you, Paul, and good morning everyone.
First, I wanted to take time to highlight our recent financing transactions. Earlier in the quarter, we completed the issuance of $ 800 million in senior first lien notes, as well as a new $500 million incremental term loan, both of which mature in 2031. Proceeds from these issuances were used to repay our existing Term Loans, as well as adding additional liquidity of over $300 million. We intend to use this incremental liquidity for the expansion and acceleration of our Kinetic fiber-to-the-home buildout, which Paul walked through earlier.
Later in the quarter, we completed an additional refinancing transaction that included a $1.4 billion add-on to the recently issued 2031 senior first lien notes. This refinancing resulted in the redemption of our existing 2028 senior first lien notes, which allowed for meaningful maturity extension while remaining leverage neutral. With the successful completion of these transactions, Windstream now has no debt maturities for over six years.
Turning to Slide 9, we show our fourth quarter financial results.
During the quarter, Windstream generated:
| · | Total revenues of $875 million,<br>and |
|---|---|
| · | Adjusted EBITDAR of $ 328 million, which was down 13% year-over-year due<br>to declining Enterprise & Wholesale legacy margins, as well as lower Kinetic margins primarily driven by impact from the ACP<br>funding elimination. |
| --- | --- |
Moving to our market-level business revenue trends:
Within Kinetic:
| · | Service revenue was $503 million, which was down 6.9% year-over-year, with<br>consumer service revenue down 5.2% year-over-year, driven largely by the ACP funding step-downs. |
|---|---|
| · | Kinetic fiber subscriber revenue was up 21% year-over-year, and fiber ARPU<br>of $72.37 was up 3% year-over-year. |
| --- | --- |
| · | Fiber consumer broadband subscribers grew by<br>10,500 during the quarter. This was offset by a loss of 35,300 DSL customers, resulting in a net decrease in total broadband units of<br>24,800 for the quarter. |
| --- | --- |
Within Enterprise:
| · | Service revenue was $261 million, down 17%, as legacy-TDM revenues continue<br>to see ongoing declines as expected. |
|---|---|
| · | Notably, approximately 91% of Enterprise Market service revenues, excluding<br>end-user surcharges, came from our Strategic and Advanced IP portfolios. These combined revenues were down 5% for the full year. |
| --- | --- |
| · | TDM and Other revenue declined 50% year-over-year as we continue to execute<br>our TDM exit strategy |
| --- | --- |
Within Wholesale:
| · | Service revenue was $102 million, down 1.8% year-over-year, driven by declines<br>in legacy revenues. Strategic revenues had solid performance during the quarter highlighted by high demand being seen from carriers, content<br>providers and hyperscalers. |
|---|
Turning to expenses:
| · | Total cash expenses during the fourth quarter fell by over $40 million, or<br>approximately 7%, year-over-year, driven by our interconnection expense reduction activities, as well as our quality and unification efforts<br>across the company. Cash expenses fell by almost $240 million in 2024 over 2023 levels. |
|---|---|
| · | Notably, our interconnection and network facility<br>expenses fell by 15% year-over-year on an annualized basis as we continue our TDM exit plan, which we expect to complete this year. |
| --- | --- |
Transitioning to slide 10, Windstream has a strong balance sheet, and following the refinancing transactions discussed earlier, we have no current debt maturities until 2031. Overall, these transactions put us in a great position as it relates to the combined capital structure with Uniti post- merger close, while also providing opportunities for us to fund our expanded fiber build plan in 2025. As of December 31st, we ended with $640 million in total liquidity and a net debt to adjusted EBITDA ratio of 2.35x.
On slide 11, we introduce our 2025 financial and operational guidance, which includes:
| · | Adjusted EBITDAR, of approximately $1.4 billion; and |
|---|---|
| · | Cash interest of approximately $230 million following our recent refinancing transactions |
| --- | --- |
| · | Capital expenditures will step-up to approximately $1.1 billion, reflecting the impact of our accelerated<br>and expanded fiber build program; and finally, |
| --- | --- |
| · | We expect low-single digit growth in Kinetic consumer subscriber revenue |
| --- | --- |
Now, I will turn the call back over to Paul for some closing comments.
Paul Sunu
Thank you, Drew.
In closing, Windstream delivered solid financial and operational results across our business during 2024.
We continue to extend our fiber footprint within our Kinetic markets.
And in 2025 we plan to build on the foundation of quality we created last year by accelerating our fiber builds and propelling our fiber penetration.
With that, we can now open the call up for questions.
Where to Find Additional Information
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation material in respect of the proposed merger between Windstream and Uniti (the “proposed transaction”). In connection with the proposed transaction, Windstream filed a registration statement on Form S-4, containing a proxy statement/prospectus, with the SEC on February 12, 2025 and Uniti filed a proxy statement with the SEC on February 12, 2025. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders are able to obtain copies of the registration statement and proxy statement/prospectus (when available) as well as other filings containing information about Windstream and Uniti, without charge, at the SEC’s website, http://www.sec.gov. Copies of the registration statement and proxy statement/prospectus and each company’s other filings with the SEC may also be obtained free of charge from the respective companies. Copies of documents filed with the SEC by Windstream will be made available free of charge on Windstream’s investor relations website at https://investor.windstream.com/. Copies of documents filed with the SEC by Uniti will be made available free of charge on Uniti’s investor relations website at https://investor.uniti.com/.
Participants in the Solicitation
Windstream and Uniti and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about the directors and executive officers of Uniti is set forth in its definitive proxy statement, which was filed with the SEC on February 12, 2025. Investors may obtain additional information regarding the interests of such participants by reading the registration statement, proxy statement/prospectus and other relevant materials regarding the proposed transaction.
Exhibit 99.3
| Feb.<br> 20, 2025 Windstream demonstrated solid financial and operational performance in 2024. We<br> embraced and instilled quality into every element of our operations, and we executed on our<br> key priorities. We ended 2024 with a strong balance sheet, aided by key refinancing transactions<br> completed during the year, and through the announced merger with Uniti, we enhanced our strategic<br> profile for the future. We extended our fiber coverage to an additional 167,000 consumer<br> premises during the year, bringing our total to over 1.6 million consumer premises passed<br> or 37% of our Kinetic footprint. We now have nearly 450,000 consumer subscribers on our fiber<br> network, representing a 27% penetration rate of our next-generation services offered. Meanwhile,<br> strategic revenues within our Enterprise and Wholesale businesses had a solid performance.<br> Within Enterprise, we continue to focus on our Strategic and Advanced IP product portfolio,<br> which now represents over 90% of Enterprise revenues. Wholesale continues to demonstrate<br> its market leadership in innovation and remains focused on expansion of our network and partnerships.<br> When reflecting on last year, I find myself proudly recounting our many accomplishments,<br> particularly our dedication to quality that led to an improved customer experience. This<br> commitment allows us to deliver services that resonate deeply with customers and to deliver<br> on our 2025 priorities. We are forging ahead with fiber in 2025. We will continue to extend<br> our reach by expanding, and accelerating, our fiber build plan to meet the growing demands<br> in our residential, business, and wholesale markets. In addition, we will continue our commitment<br> to quality and operational excellence, with the aim to capture greater market share and meet<br> the evolving needs of our customers. Simply put, we want to be the trusted provider of communication<br> services, the go-to company for the most reliable and responsive network, and the first choice<br> for quality and service. FROM THE DESK OF Paul Sunu Chairman & CEO |
|---|
| Where to Find Additional Information<br><br> <br><br><br><br><br>This communication does not constitute an offer to sell or the solicitation<br>of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation<br>material in respect of the proposed merger between Windstream and Uniti (the “proposed transaction”). In connection<br>with the proposed transaction, Windstream filed a registration statement on Form S-4, containing a proxy statement/prospectus, with the<br>SEC on February 12, 2025 and Uniti filed a proxy statement with the SEC on February 12, 2025. INVESTORS AND SECURITY HOLDERS ARE URGED<br>TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT<br>DOCUMENTS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security<br>holders are able to obtain copies of the registration statement and proxy statement/prospectus (when available) as well as other filings<br>containing information about Windstream and Uniti, without charge, at the SEC’s website, http://www.sec.gov. Copies of the registration<br>statement and proxy statement/prospectus and each company’s other filings with the SEC may also be obtained free of charge from<br>the respective companies. Copies of documents filed with the SEC by Windstream will be made available free of charge on Windstream’s<br>investor relations website at https://investor.windstream.com/. Copies of documents filed with the SEC by Uniti will be made available<br>free of charge on Uniti’s investor relations website at https://investor.uniti.com/.<br><br><br><br><br><br><br><br>Participants in the Solicitation<br><br><br>****<br><br><br><br>Windstream and Uniti and certain of their respective<br>directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information<br>about the directors and executive officers of Uniti is set forth in its definitive proxy statement, which was filed with the SEC on February<br>12, 2025. Investors may obtain additional information regarding the interests of such participants by reading the registration statement,<br>proxy statement/prospectus and other relevant materials regarding the proposed transaction. |
| --- |
Exhibit 99.4
| 2024 Company Overview<br>Strong Balance Sheet with No Near-Term Maturities<br>~$3.7B<br>Revenue<br>~$1.5B<br>Adj. EBITDAR<br>$884M<br>CapEx<br>Windstream showed solid financial and operational performance across our business in 2024. We embraced<br>and instilled quality into every element of our company, leading to operational effectiveness and an improved<br>customer experience. In 2025, as we look forward to our merger with Uniti, we will leverage our commitment<br>to quality and operational excellence to accelerate fiber construction, grow market share, and strengthen our<br>customer relationships.<br>(1) Adjusted EBITDAR excluding gain on sale of operating assets. (2) Excludes end-user surcharges and is based on 4Q24 results on an annualized basis.<br>2024 Financial<br>Snapshot<br>Note: Available capacity under credit facility excludes outstanding letters of credit of $184 million of which $152.5 million was issued to Universal Service Administrative Company as a condition for<br>Windstream receiving RDOF funding<br>Effective September 21, 2024, the borrowing capacity under the credit facility decreased from $500 million to $475 million.<br>Debt Maturity as of 4Q 2024<br>(1) |
|---|
| 2025 Priorities |
| --- |
| Where to Find Additional Information<br><br> <br><br><br><br><br>This communication does not constitute an offer to sell or the solicitation<br>of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation<br>material in respect of the proposed merger between Windstream and Uniti (the “proposed transaction”). In connection<br>with the proposed transaction, Windstream filed a registration statement on Form S-4, containing a proxy statement/prospectus, with the<br>SEC on February 12, 2025 and Uniti filed a proxy statement with the SEC on February 12, 2025. INVESTORS AND SECURITY HOLDERS ARE URGED<br>TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT<br>DOCUMENTS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security<br>holders are able to obtain copies of the registration statement and proxy statement/prospectus (when available) as well as other filings<br>containing information about Windstream and Uniti, without charge, at the SEC’s website, http://www.sec.gov. Copies of the registration<br>statement and proxy statement/prospectus and each company’s other filings with the SEC may also be obtained free of charge from<br>the respective companies. Copies of documents filed with the SEC by Windstream will be made available free of charge on Windstream’s<br>investor relations website at https://investor.windstream.com/. Copies of documents filed with the SEC by Uniti will be made available<br>free of charge on Uniti’s investor relations website at https://investor.uniti.com/.<br><br><br><br><br><br><br><br>Participants in the Solicitation<br><br><br>****<br><br><br><br>Windstream and Uniti and certain of their respective<br>directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information<br>about the directors and executive officers of Uniti is set forth in its definitive proxy statement, which was filed with the SEC on February<br>12, 2025. Investors may obtain additional information regarding the interests of such participants by reading the registration statement,<br>proxy statement/prospectus and other relevant materials regarding the proposed transaction. |
| --- |