NTELOS Holdings Corp. Reports Fourth Quarter and Year-End 2015 Results

- Acquisition by Shentel on Schedule to Close After Receipt of FCC Approval

News provided by

Mar 11, 2016, 07:37 ET

WAYNESBORO, Va., March 11, 2016 /PRNewswire/ -- NTELOS Holdings Corp. (NASDAQ: NTLS) ("nTelos" or the "Company") announced today operating and financial results for its fourth quarter and year ended December 31, 2015.

On August 10, 2015, the Company entered into a definitive agreement to be acquired by Shenandoah Telecommunications Company ("Shentel", NASDAQ: SHEN) for $9.25 in cash per share. The proposed acquisition was approved by the Company's shareholders and has received all necessary regulatory approvals from federal and state regulatory bodies, except for approval by the Federal Communications Commission ("FCC"). The Company expects the proposed acquisition by Shentel to close as soon as practical once FCC approval is received. For additional information regarding the transaction and closing conditions, please see the Company's filings with the Securities and Exchange Commission ("SEC"), including the definitive proxy statement filed with the SEC on October 13, 2015.

The "Highlights" and "Subscriber Update" sections below represent results of the Company's continuing operations, with additional and reconciling information included in the supplemental schedules provided.

Highlights

Revenues were $87.6 million for the fourth quarter 2015, compared to $96.7 million for the fourth quarter 2014. Revenues for the year 2015 were $362.6 million, up slightly as compared to $360.1 million for the year 2014;

Adjusted EBITDA, excluding discontinued operations, was $18.2 million for the fourth quarter 2015, compared to $24.6 million for the fourth quarter 2014. Adjusted EBITDA for the year 2015 was $96.2 million, compared to $108.6 million for the year 2014;

Net subscriber additions for year 2015 were 20,000, as compared to 14,600 for the prior year;

Approximately 40% of postpay subscribers were on Equipment Installment Plans at year end 2015; and

Approximately 70% of covered POPs have access to our LTE network.

Subscriber Update

Total Subscribers

Total subscribers were 302,000 as of December 31, 2015, compared to 300,200 for the third quarter 2015 and 282,100 for the fourth quarter 2014;

Total subscriber gross additions for the fourth quarter 2015 were 27,100, compared to 25,500 for the third quarter 2015 and 28,300 for the fourth quarter 2014. Total subscriber net additions for the fourth quarter 2015 were 1,900, compared to 2,700 for the third quarter 2015 and 5,000 for the fourth quarter 2014; and

Total subscriber gross additions for the year 2015 were 105,800, compared to 100,400 for the year 2014. Total subscriber net additions for the year 2015 were 20,000, compared to 14,600 for the year 2014.

Postpay Subscribers

Postpay subscriber gross additions for the fourth quarter 2015 were 16,900, compared to 15,400 for the third quarter 2015 and 18,600 for the fourth quarter 2014;

Net postpay subscriber additions were 1,600 for the fourth quarter 2015, compared to 2,100 for the third quarter 2015 and 4,700 for the fourth quarter 2014;

Postpay churn for the fourth quarter 2015 was 2.2%, compared to 1.9% for third quarter 2015 and 2.2% for the fourth quarter 2014;

ABPU was $57.83 for the fourth quarter 2015, compared to $58.29 for the third quarter 2015 and $59.35 for the fourth quarter 2014; and

As of December 31, 2015, total postpay subscribers were 233,300.

Prepay Subscribers

Prepay subscriber gross additions for the fourth quarter 2015 were 10,200, compared to 10,100 for the third quarter 2015 and 9,700 for the fourth quarter 2014;

Net prepay subscriber additions were 300 for the fourth quarter 2015, compared to 600 for the third quarter 2015 and 300 for the fourth quarter 2014;

Prepay churn for the fourth quarter 2015 was 4.8%, compared to 4.6% for the third quarter 2015 and 5.0% for the fourth quarter 2014; and

As of December 31, 2015, total prepay subscribers were 68,700.

Net Income

Net income (loss) of nTelos, after net income attributable to noncontrolling interests, was $(19.6) million, or $(0.92) per basic share, for the fourth quarter 2015, compared to $(56.2) million, or $(2.66) per basic share, for the fourth quarter 2014.

Liquidity

Total cash, including both restricted and unrestricted cash, at the end of the fourth quarter 2015 was $74.9 million, compared to $75.7 million at the end of the fourth quarter 2014.

Eastern Markets Commercial Wind Down Completion

In the fourth quarter of 2014, the Company announced a strategic refocus of its business operations on its western Virginia and West Virginia markets ("Western Markets" or "Markets"). On November 15, 2015, the Company completed the wind down of commercial operations in its Eastern Markets.

As a result of no longer providing service in the Eastern Markets, certain assets, liabilities and results of operations are now being reported as Discontinued Operations. Accordingly, the Company has recast the prior period results to be comparable with the current Discontinued Operations presentation.

Business Outlook

As a result of the announcement that the Company has entered into a definitive agreement to be acquired by Shentel, the Company no longer provides operating or financial guidance.

Conference Call

As a result of the announcement that the Company has entered into a definitive agreement to be acquired by Shentel, the Company will not host a fourth quarter and full year 2015 conference call and webcast.

Non-GAAP Measures

Adjusted EBITDA is defined as net income attributable to NTELOS Holdings Corp. before interest, income taxes, depreciation and amortization, accretion of asset retirement obligations, transaction related costs, restructuring and asset impairment charges, gain/loss on sale or disposal of assets and derivatives, net income attributable to noncontrolling interests, other expenses/income, equity-based compensation charges, separation charges, secondary offering costs, adjustments for impact of recognizing deferred gain associated with towers sold to Grain Management and adjustments for impact of recognizing a portion of the billed SNA contract revenues on a straight line basis.

ABPU, or average billings per user, is computed by adding average monthly postpaid service billings to users and equipment installment plan (EIP) billings divided by the average number of postpaid users during the period, further divided by the number of months in the period. NTELOS believes average postpaid customer billings per user is indicative of estimated cash collection, including equipment installments, from customers each month.

Adjusted EBITDA is a key metric used by investors to determine if the Company is generating sufficient cash flows to continue to produce shareholder value and provide liquidity for future growth. ABPU provides management with useful information concerning the appeal of the Company's postpay rate plans and service offerings and the Company's performance in attracting and retaining high value customers.

Adjusted EBITDA and ABPU are non-GAAP financial performance measures. They should not be considered in isolation or as an alternative to measures determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Please refer to the exhibits and materials posted on the Company's website for a reconciliation of these non-GAAP financial performance measures to the most comparable measures reported in accordance with GAAP and for a discussion of the presentation, comparability and use of such financial performance measures.

About NTELOS

NTELOS Holdings Corp. (NTLS), operating through its subsidiaries as "nTelos Wireless," is headquartered in Waynesboro, VA, and provides high-speed, dependable nationwide voice and data coverage for approximately 302,000 retail subscribers based in its Western Markets, comprised of western Virginia, West Virginia and portions of Maryland, North Carolina, Pennsylvania, Ohio and Kentucky. The Company's licensed territories in the Western Markets have a total population of approximately 4.4 million residents, of which its wireless network covers approximately 3.1 million residents. The Company is also the exclusive wholesale provider of wireless network services to Sprint Corporation in portions of its western Virginia and West Virginia territories for all Sprint wireless customers.

FORWARD-LOOKING STATEMENTS

This document may contain statements, estimates or projections that constitute "forward-looking statements" as defined under U.S. federal securities laws. Generally, the words "believe," "expect," "intend," "plan," "estimate," "anticipate," "project," "will," "may" "should," and similar expressions identify forward-looking statements, which generally are not historical in nature.

Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update any of them publicly in light of new information or future events. The forward-looking statements are or may be based on a series of projections and estimates and involve risks and uncertainties. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include, but are not limited to, those described in Part II, "Item 1A, Risk Factors" and elsewhere in this quarterly report and in our Annual Report on Form 10-K for the year ended December 31, 2015 and those described from time to time in our filings with the Securities and Exchange Commission.

Additionally, there are risks and uncertainties associated with the proposed acquisition by Shentel such as: (1) conditions to the closing of the merger, including, without limitation, the consummation of certain transactions between Shentel and Sprint, may not be satisfied and required regulatory approvals may not be obtained; (2) the merger may involve unexpected costs, liabilities or delays; (3) the risks related to disruption of management's attention from the Company's ongoing business operations due to the transaction, (4) the effect of the announcement of the merger on the ability of the Company to retain and hire key personnel and maintain relationships with its customers, suppliers and others with whom it does business, or on its operating results and business generally, (5) the outcome of any legal proceedings related to the merger; (6) the Company may be adversely affected by other economic, business, and/or competitive factors; (7) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; (8) changes in the legal or regulatory environment; and (9) other risks to consummation of the merger, including the risk that the merger will not be consummated within the expected time period or at all. If the merger is consummated, the Company stockholders will cease to have any equity interest in the Company and will have no right to participate in its earnings and future growth.

Exhibits:

Consolidated Financial Statements
- Condensed Consolidated Balance Sheets
- Condensed Consolidated Statements of Operations

Consolidated Operating Metrics
- Reconciliation of Net Income Attributable to NTELOS Holdings Corp. to Adjusted EBITDA
- Key Metrics
- ABPU Reconciliation – Postpay
- Quarterly Reconciliation of Net Income Attributable to NTELOS Holdings Corp. to Adjusted EBITDA

NTELOS Holdings Corp.
Condensed Consolidated Balance Sheets			(Unaudited)	(Unaudited)
			December 31, 2015	December 31, 2014
(In thousands)

		ASSETS
Current Assets
	Cash		$ 72,687	$ 73,546
	Restricted Cash		-	2,167
	Accounts receivable, net		53,021	35,177
	Inventories and supplies, net		13,345	17,978
	Prepaid expenses		9,350	8,295
	Tax refund receivable		24,986	3,883
	Other current assets		1,132	617
	Other current assets from discontinued operations		2,121	14,763
			176,642	156,426

Assets Held for Sale			62	4,317

Restricted Cash			2,167	-

Securities and Investments			1,522	1,522

Property, Plant and Equipment, net			326,260	266,054

Intangible Assets
	Goodwill		63,700	63,700
	Radio spectrum licenses		44,933	44,933
	Customer relationships and trademarks, net		4,292	5,084

Deferred Charges and Other Assets			18,941	16,919

Deferred Income Taxes			2,737	3,360

Other Noncurrent Assets from Discontinued Operations			1,733	85,402

Total Assets			$ 642,989	$ 647,717


		LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
	Current portion of long-term debt		$ 5,605	$ 5,728
	Accounts payable		20,532	24,130
	Advance billings and customer deposits		12,772	10,284
	Accrued expenses and other current liabilities		18,003	20,255
	Other current liabilities from discountinued operations		13,054	12,245
			69,966	72,642

Long-Term Debt			514,634	519,491

Retirement Benefits			22,448	25,209

Deferred Income Taxes			12,272	1,685

Other Long-Term Liabilities			61,860	33,913

Other Long-Term Liabilities from Discontinued Operations			835	27,729

Stockholders' Equity (Deficit)			(39,026)	(32,952)

Total Liabilities and Stockholders' Equity (Deficit)			$ 642,989	$ 647,717

NTELOS Holdings Corp.
Condensed Consolidated Statements of Operations		Three Months Ended		Twelve Months Ended
		(Unaudited)		(Unaudited)
(In thousands, except per share amounts)		December 31, 2015	December 31, 2014	December 31, 2015	December 31, 2014

Operating Revenues
	Retail Revenue	$ 41,006	$ 44,428	$ 168,674	$ 177,295
	Wholesale and other revenue	33,066	37,396	140,121	152,783
	Equipment sales	13,523	14,828	53,845	30,056
Operating Revenues		87,595	96,652	362,640	360,134

Operating Expenses
	Cost of services	23,019	20,959	89,413	80,763
	Cost of equipment sold	23,709	24,721	87,753	73,044
	Customer operations	16,514	20,908	68,484	74,990
	Corporate operations	9,459	9,513	38,951	37,388
	Restructuring	115	982	2,487	982
	Depreciation and amortization	15,205	14,758	55,102	55,225
	Gain on sale of assets	-	-	(11,111)	-
		88,021	91,841	331,079	322,392

Operating Income (loss)		(426)	4,811	31,561	37,742

Other Expense
	Interest expense, net	(7,576)	(8,061)	(30,589)	(32,697)
	Other income (expense), net	21	80	80	(1,115)
		(7,555)	(7,981)	(30,509)	(33,812)

Income (Loss) before Income Taxes		(7,981)	(3,170)	1,052	3,930

Income Tax Expense (Benefit)		(2,941)	(1,395)	2,187	747
Net Income (Loss) from Continuing Operations		(5,040)	(1,775)	(1,135)	3,183
Loss from Discontinued Operations, Net of Tax		(14,441)	(54,128)	(9,903)	(55,349)
Net Loss		(19,481)	(55,903)	(11,038)	(52,166)

Net Income Attributable to Noncontrolling Interests		(168)	(305)	(1,168)	(1,468)

Net Loss Attributable to NTELOS Holdings Corp.		$ (19,649)	$ (56,208)	$ (12,206)	$ (53,634)


Earnings (Loss) per Share Attributable to NTELOS Holdings Corp

	Basic Earnings (Loss) per common share from continuing operations	$ (0.24)	$ (0.10)	$ (0.10)	$ 0.08
	Basic Earnings (Loss) per common share from discontinued operations	(0.68)	(2.56)	(0.47)	(2.62)
	Basic Earnings (Loss) per common share	$ (0.92)	$ (2.66)	$ (0.57)	$ (2.54)

	Weighted average shares outstanding - basic	21,307	21,146	21,257	21,111

	Diluted Earnings (Loss) per common share from continuing operations	$ (0.24)	$ (0.10)	$ (0.10)	$ 0.08
	Diluted Earnings (Loss) per common share from discontinued operations	(0.68)	(2.56)	(0.47)	(2.62)
	Diluted Earnings (Loss) per common share	$ (0.92)	$ (2.66)	$ (0.57)	$ (2.54)

	Weighted average shares outstanding - diluted	21,307	21,146	21,257	21,111

Cash Dividends Declared per Share - Common Stock		$ -	$ -	$ -	$ 0.84

NTELOS Holdings Corp.
Reconciliation of Net Income (Loss) Attributable to NTELOS Holdings Corp. to Adjusted EBITDA - (Consolidated)
(In thousands)
			Three Months Ended		Twelve Months Ended
			December 31, 2015	December 31, 2014	December 31, 2015	December 31, 2014
		Net loss attributable to NTELOS Holdings Corp.	$ (19,649)	$ (56,208)	$ (12,206)	$ (53,634)
		Net loss attributable to discontinued operations	(14,441)	(54,128)	(9,903)	(55,349)
		Net income attributable to noncontrolling interests	168	305	1,168	1,468
		Net income (loss) attributable to continuing operations	$ (5,040)	$ (1,775)	$ (1,135)	$ 3,183

		Interest expense	7,576	8,061	30,589	32,697
		Income tax (benefit)	(2,941)	(1,395)	2,187	747
		Other expense (income), net	(21)	(80)	(80)	1,115
		Operating income (loss)	$ (426)	$ 4,811	$ 31,561	$ 37,742

		Depreciation and amortization	15,205	14,758	55,102	55,225
		Restructuring	115	982	2,487	982
		Gain on sale of assets	-	-	(11,111)	-
		Accretion of asset retirement obligations	275	241	1,209	878
		Adjusted EBITDA attributable to discontinued operations	(1,178)	6,781	11,487	23,884
		Equity-based compensation	792	731	3,428	2,272
		SNA straight-line adjustment ¹	2,315	3,065	11,010	8,173
		Other²	(28)	2	2,481	3,279
		Adjusted EBITDA	$ 17,070	$ 31,371	$ 107,654	$ 132,435


Reconciliation of Net Income (Loss) Attributable to Discontinued Operations to Adjusted EBITDA - (Discontinued Operations)
(In thousands)
			Three Months Ended		Twelve Months Ended
			December 31, 2015	December 31, 2014	December 31, 2015	December 31, 2014
		Net loss attributable to discontinued operations	$ (14,441)	$ (54,128)	$ (9,903)	$ (55,349)
		Net income attributable to noncontrolling interests	-	-	-	-
		Net loss	$ (14,441)	$ (54,128)	$ (9,903)	$ (55,349)

		Interest expense	(27)	(10)	(127)	(2)
		Income tax (benefit)	(9,327)	(34,016)	(6,880)	(33,641)
		Operating income (loss)	$ (23,795)	$ (88,154)	$ (16,910)	$ (88,992)

		Depreciation and amortization	1,497	4,232	4,999	21,235
		Restructuring	20,965	2,681	26,830	2,681
		Gain on sale of assets	-	-	(5,637)	-
		Asset Impairment	-	87,853	117	87,853
		Accretion of asset retirement obligations	(132)	121	157	410
		Equity-based compensation	4	47	20	697
		Cell site spectrum rent	302	-	1,911	-
		Other²	(19)	1	-	-
		Adjusted EBITDA attributable to discontinued operations	$ (1,178)	$ 6,781	$ 11,487	$ 23,884

Reconciliation of Net Income (Loss) Attributable to NTELOS Holdings Corp. to Adjusted EBITDA - (Continuing Operations)
(In thousands)
			Three Months Ended		Twelve Months Ended
			December 31, 2015	December 31, 2014	December 31, 2015	December 31, 2014
		Net income (loss) attributable to NTELOS Holdings Corp.	$ (19,649)	$ (56,208)	$ (12,206)	$ (53,634)
		Net income (loss) attributable to discontinued operations	(14,441)	(54,128)	(9,903)	(55,349)
		Net income attributable to noncontrolling interests	168	305	1,168	1,468
		Net income (loss)	$ (5,040)	$ (1,775)	$ (1,135)	$ 3,183

		Interest expense	7,576	8,061	30,589	32,697
		Income tax (benefit)	(2,941)	(1,395)	2,187	747
		Other expense (income), net	(21)	(80)	(80)	1,115
		Operating income (loss)	$ (426)	$ 4,811	$ 31,561	$ 37,742

		Depreciation and amortization	15,205	14,758	55,102	55,225
		Restructuring	115	982	2,487	982
		Gain on sale of assets	-	-	(11,111)	-
		Accretion of asset retirement obligations	275	241	1,209	878
		Equity-based compensation	792	731	3,428	2,272
		SNA straight-line adjustment ¹	2,315	3,065	11,010	8,173
		Other²	(28)	2	2,481	3,279
		Adjusted EBITDA attributable to continuing operations	$ 18,248	$ 24,590	$ 96,167	$ 108,551

Reconciliation of Adjusted EBITDA - (Continuing Operations) to previously reported Western Markets Adjusted EBITDA³
(In thousands)
			Three Months Ended		Twelve Months Ended
			December 31, 2015	December 31, 2014	December 31, 2015	December 31, 2014
		Adjusted EBITDA attributable to continuing operations	$ 18,248	$ 24,590	$ 96,167	$ 108,551

		Cost of services-previous allocation to Eastern Markets	-	195	-	583
		Customer operations-previous allocation to Eastern Markets	-	2,612	-	10,507
		Corporate operations-previous allocation to Eastern Markets	-	2,800	-	10,089
		Adjusted EBITDA attributable to Western Markets³	$ 18,248	$ 30,197	$ 96,167	$ 129,730

	¹	Adjustment for impact of recognizing a portion of the billed SNA contract revenues on a straight line basis.
	²	In 2014, Other includes legal and advisory fees related to new Sprint agreement and certain employee separation charges.
		In 2015, Other includes certain non-recurring corporate costs and adjustments for recognizing a portion of the deferred gain
		for towers sold to Grain Management, LLC.
		Western Markets was previously defined as Holdings less Eastern Markets and, for 2014, included the allocation of
		certain corporate expenses to the Eastern Markets.

NTELOS Holdings Corp. ¹
Key Metrics							Twelve Months Ended
	Quarter Ended:	12/31/2014	3/31/2015	6/30/2015	9/30/2015	12/31/2015	12/31/2014	12/31/2015
Subscribers
	Beginning Subscribers	277,100	282,100	290,100	297,500	300,200	273,600	282,100
	Postpay	215,500	220,100	224,700	229,000	231,300	208,800	220,100
	Prepay	61,600	62,000	65,400	68,500	68,900	64,800	62,000

	Gross Additions	28,300	27,500	25,700	25,500	27,100	100,400	105,800
	Postpay	18,600	15,700	14,300	15,400	16,900	63,400	62,300
	Prepay	9,700	11,800	11,400	10,100	10,200	37,000	43,500

	Disconnections	23,300	19,500	18,300	22,800	25,200	85,800	85,800
	Postpay	13,900	11,100	10,000	13,300	15,300	50,500	49,700
	Prepay	9,400	8,400	8,300	9,500	9,900	35,300	36,100

	Net Additions (Losses)	5,000	8,000	7,400	2,700	1,900	14,600	20,000
	Postpay	4,700	4,600	4,300	2,100	1,600	12,900	12,600
	Prepay	300	3,400	3,100	600	300	1,700	7,400

	Ending Subscribers ²	282,100	290,100	297,500	300,200	302,000	282,100	302,000
	Postpay	220,100	224,700	229,000	231,300	233,300	220,100	233,300
	Prepay	62,000	65,400	68,500	68,900	68,700	62,000	68,700

	Churn, net	2.8%	2.3%	2.1%	2.5%	2.8%	2.6%	2.4%
	Postpay	2.2%	1.7%	1.5%	1.9%	2.2%	2.0%	1.8%
	Prepay	5.0%	4.4%	4.1%	4.6%	4.8%	4.6%	4.5%


Other Items

	ABPU Statistics

	ABPU	$ 59.35	$ 58.04	$ 58.64	$ 58.29	$ 57.83	$ 59.64	$ 58.20


	Strategic Network Alliance Revenues (000's) ³

	Billed Revenue	$ 38,329	$ 36,627	$ 37,887	$ 35,408	$ 33,453	$ 153,754	$ 143,375
	Straight-Line Adjustment	(3,065)	(3,065)	(3,065)	(2,565)	(2,315)	(8,173)	(11,010)
	Spectrum Lease Consideration	1,233	1,190	1,222	1,221	1,222	3,289	4,855
	SNA Revenues	$ 36,497	$ 34,752	$ 36,044	$ 34,064	$ 32,360	$ 148,870	$ 137,220

	Network Statistics

	Licensed Population (millions)	4.4	4.4	4.4	4.4	4.4	4.4	4.4
	Covered Population (millions)	3.1	3.1	3.1	3.1	3.1	3.1	3.1
	Total Cell Sites	1,004	1,006	1,007	1,006	1,008	1,004	1,008
	LTE Cell Sites	135	202	274	382	489	135	489
	LTE % of Total Cell Sites	13.4%	20.1%	27.2%	38.0%	48.5%	13.4%	48.5%
	LTE % of Covered POPs	22.2%	43.6%	53.1%	64.7%	70.0%	22.2%	70.0%

¹	Results exclude Discontinued Operations (Eastern Markets).
²	Ending subscribers may not foot due to customer transfers between product classes and rounding.
³	Effective 5/1/14, SNA Revenues include the impact of recognizing the fixed fee element of SNA contract revenues on a straightline basis, which is a reduction of
	billed revenue, and the non-cash consideration attributable to spectrum leases. We have recognized an equal charge for spectrum lease expense within
	cost of sales and services.

NTELOS Holdings Corp. ¹
ABPU Reconciliation - Postpay		Three Months Ended		Twelve Months Ended
Average Monthly Billings per User (ABPU) ²		December 31, 2015	December 31, 2014	December 31, 2015	December 31, 2014
(In thousands, except for subscribers and ABPU)

Retail Revenue		$ 41,006	$ 44,428	$ 168,674	$ 177,295
Plus: EIP billings		5,418	351	15,685	364
Less: prepay service revenues and other		(6,176)	(6,207)	(25,151)	(25,333)
Total postpay billings		$ 40,248	$ 38,572	$ 159,208	$ 152,326

Average number of postpay subscribers		232,000	216,600	228,000	212,800
Postpay ABPU		$ 57.83	$ 59.35	$ 58.20	$ 59.64

¹	Results exclude Discontinued Operations (Eastern Markets).

²	Average monthly billings per user (ABPU) is computed by dividing postpay service revenues and equipment installment plan (EIP) billings per period by the average number of postpay subscribers during that period. ABPU as defined may not be similar to ABPU measures of other companies, is not a measurement under GAAP and should be considered in addition to, but not as a substitute for, the information contained in the Company's consolidated statements of operations. The Company closely monitors the effects of new rate plans and service offerings on ABPU in order to determine their effectiveness. ABPU provides management useful information concerning the appeal of NTELOS rate plans and service offerings and the Company's performance in attracting and retaining high-value customers.

NTELOS Holdings Corp.
Reconciliation of Net Income (Loss) Attributable to NTELOS Holdings Corp. to Adjusted EBITDA - (Consolidated)
(In thousands)
			Three Months Ended								Twelve Months Ended
			December 31, 2015	September 30, 2015	June 30, 2015	March 31, 2015	December 31, 2014	September 30, 2014	June 30, 2014	March 31, 2014	December 31, 2015	Qtrs Added	December 31, 2014	Qtr Added
		Net income (loss) attributable to NTELOS Holdings Corp.	$ (19,649)	$ (8,963)	$ 1,610	$ 14,796	$ (56,208)	$ 804	$ 484	$ 1,286	$ (12,206)	$ (12,206)	$ (53,634)	$ (53,634)
		Net income (loss) attributable to discontinued operations	(14,441)	(4,498)	787	8,249	(54,128)	(92)	(457)	(672)	(9,903)	(9,903)	(55,349)	(55,349)
		Net income attributable to noncontrolling interests	168	237	272	491	305	352	375	436	1,168	1,168	1,468	1,468
		Net income (loss) attributable to continuing operations	$ (5,040)	$ (4,228)	$ 1,095	$ 7,038	$ (1,775)	$ 1,248	$ 1,316	$ 2,394	$ (1,135)	$ (1,135)	$ 3,183	$ 3,183

		Interest expense	7,576	7,451	7,614	7,948	8,061	8,368	8,312	7,956	30,589	30,589	32,697	32,697
		Income tax (benefit)	(2,941)	(577)	892	4,813	(1,395)	417	512	1,213	2,187	2,187	747	747
		Other expense (income), net	(21)	(29)	(33)	3	(80)	31	92	1,072	(80)	(80)	1,115	1,115
		Operating income (loss)	$ (426)	$ 2,617	$ 9,568	$ 19,802	$ 4,811	$ 10,064	$ 10,232	$ 12,635	$ 31,561	$ 31,561	$ 37,742	$ 37,742

		Depreciation and amortization	15,205	13,851	13,129	12,917	14,758	13,715	13,774	12,978	55,102	55,102	55,225	55,225
		Restructuring	115	90	677	1,605	982	-	-	-	2,487	2,487	982	982
		Gain on sale of assets	-	-	(102)	(11,009)	-	-	-	-	(11,111)	(11,111)	-	-
		Accretion of asset retirement obligations	275	319	315	300	241	179	235	223	1,209	1,209	878	878
		Adjusted EBITDA attributable to discontinued operations	(1,178)	(1,048)	3,673	10,040	6,781	4,929	6,341	5,833	11,487	11,487	23,884	23,884
		Equity-based compensation	792	876	900	860	731	(212)	866	887	3,428	3,428	2,272	2,272
		SNA straight-line adjustment ¹	2,315	2,565	3,065	3,065	3,065	3,065	2,043	-	11,010	11,010	8,173	8,173
		Other²	(28)	2,805	(96)	(200)	2	1,038	872	1,367	2,481	2,481	3,279	3,279
		Adjusted EBITDA	$ 17,070	$ 22,075	$ 31,129	$ 37,380	$ 31,371	$ 32,778	$ 34,363	$ 33,923	$ 107,654	$ 107,654	$ 132,435	$ 132,435


Reconciliation of Net Income (Loss) Attributable to Discontinued Operations to Adjusted EBITDA - (Discontinued Operations)
(In thousands)
			Three Months Ended								Twelve Months Ended
			December 31, 2015	September 30, 2015	June 30, 2015	March 31, 2015	December 31, 2014	September 30, 2014	June 30, 2014	March 31, 2014	December 31, 2015	December 31, 2015	December 31, 2014	December 31, 2014
		Net income (loss) attributable to discontinued operations	$ (14,441)	$ (4,498)	$ 787	$ 8,249	$ (54,128)	$ (92)	$ (457)	$ (672)	$ (9,903)	$ (9,903)	$ (55,349)	$ (55,349)
		Net income attributable to noncontrolling interests	-	-	-	-	-	-	-	-	-	-	-	-
		Net income (loss)	$ (14,441)	$ (4,498)	$ 787	$ 8,249	$ (54,128)	$ (92)	$ (457)	$ (672)	$ (9,903)	$ (9,903)	$ (55,349)	$ (55,349)

		Interest expense	(27)	(29)	(41)	(30)	(10)	2	3	3	(127)	(127)	(2)	(2)
		Income tax (benefit)	(9,327)	(2,946)	197	5,196	(34,016)	350	128	(103)	(6,880)	(6,880)	(33,641)	(33,641)
		Operating income (loss)	$ (23,795)	$ (7,473)	$ 943	$ 13,415	$ (88,154)	$ 260	$ (326)	$ (772)	$ (16,910)	$ (16,910)	$ (88,992)	$ (88,992)

		Depreciation and amortization	1,497	1,301	1,136	1,065	4,232	4,759	6,155	6,089	4,999	4,999	21,235	21,235
		Restructuring	20,965	4,537	925	403	2,681	-	-	-	26,830	26,830	2,681	2,681
		Gain on sale of assets	-	-	(699)	(4,938)	-	-	-	-	(5,637)	(5,637)	-	-
		Asset Impairment	-	5	220	(108)	87,853	-	-	-	117	117	87,853	87,853
		Accretion of asset retirement obligations	(132)	(47)	132	204	121	101	96	92	157	157	410	410
		Equity-based compensation	4	7	10	(1)	47	(190)	416	424	20	20	697	697
		Cell site spectrum rent	302	603	1,006	-	-	-	-	-	1,911	1,911	-	-
		Other²	(19)	19	-	-	1	(1)	-	-	-	-	-	-
		Adjusted EBITDA attributable to discontinued operations	$ (1,178)	$ (1,048)	$ 3,673	$ 10,040	$ 6,781	$ 4,929	$ 6,341	$ 5,833	$ 11,487	$ 11,487	$ 23,884	$ 23,884

Reconciliation of Net Income (Loss) Attributable to NTELOS Holdings Corp. to Adjusted EBITDA - (Continuing Operations)
(In thousands)
			Three Months Ended								Twelve Months Ended
			December 31, 2015	September 30, 2015	June 30, 2015	March 31, 2015	December 31, 2014	September 30, 2014	June 30, 2014	March 31, 2014	December 31, 2015	December 31, 2015	December 31, 2014	December 31, 2014
		Net income (loss) attributable to NTELOS Holdings Corp.	$ (19,649)	$ (8,963)	$ 1,610	$ 14,796	$ (56,208)	$ 804	$ 484	$ 1,286	$ (12,206)	$ (12,206)	$ (53,634)	$ (53,634)
		Net income (loss) attributable to discontinued operations	(14,441)	(4,498)	787	8,249	(54,128)	(92)	(457)	(672)	(9,903)	(9,903)	(55,349)	(55,349)
		Net income attributable to noncontrolling interests	168	237	272	491	305	352	375	436	1,168	1,168	1,468	1,468
		Net income (loss)	$ (5,040)	$ (4,228)	$ 1,095	$ 7,038	$ (1,775)	$ 1,248	$ 1,316	$ 2,394	$ (1,135)	$ (1,135)	$ 3,183	$ 3,183

		Interest expense	7,576	7,451	7,614	7,948	8,061	8,368	8,312	7,956	30,589	30,589	32,697	32,697
		Income tax (benefit)	(2,941)	(577)	892	4,813	(1,395)	417	512	1,213	2,187	2,187	747	747
		Other expense (income), net	(21)	(29)	(33)	3	(80)	31	92	1,072	(80)	(80)	1,115	1,115
		Operating income (loss)	$ (426)	$ 2,617	$ 9,568	$ 19,802	$ 4,811	$ 10,064	$ 10,232	$ 12,635	$ 31,561	$ 31,561	$ 37,742	$ 37,742

		Depreciation and amortization	15,205	13,851	13,129	12,917	14,758	13,715	13,774	12,978	55,102	55,102	55,225	55,225
		Restructuring	115	90	677	1,605	982	-	-	-	2,487	2,487	982	982
		Gain on sale of assets	-	-	(102)	(11,009)	-	-	-	-	(11,111)	(11,111)	-	-
		Accretion of asset retirement obligations	275	319	315	300	241	179	235	223	1,209	1,209	878	878
		Equity-based compensation	792	876	900	860	731	(212)	866	887	3,428	3,428	2,272	2,272
		SNA straight-line adjustment ¹	2,315	2,565	3,065	3,065	3,065	3,065	2,043	-	11,010	11,010	8,173	8,173
		Other²	(28)	2,805	(96)	(200)	2	1,038	872	1,367	2,481	2,481	3,279	3,279
		Adjusted EBITDA attributable to continuing operations	$ 18,248	$ 23,123	$ 27,456	$ 27,340	$ 24,590	$ 27,849	$ 28,022	$ 28,090	$ 96,167	$ 96,167	$ 108,551	$ 108,551

Reconciliation of Adjusted EBITDA - (Continuing Operations) to previously reported Western Markets Adjusted EBITDA³
(In thousands)
			Three Months Ended								Twelve Months Ended
			December 31, 2015	September 30, 2015	June 30, 2015	March 31, 2015	December 31, 2014	September 30, 2014	June 30, 2014	March 31, 2014	December 31, 2015	December 31, 2015	December 31, 2014	December 31, 2014
		Adjusted EBITDA attributable to continuing operations	$ 18,248	$ 23,123	$ 27,456	$ 27,340	$ 24,590	$ 27,849	$ 28,022	$ 28,090	$ 96,167	$ 96,167	$ 108,551	$ 108,551

		Cost of services-previous allocation to Eastern Markets	-	-	-	-	195	143	121	124	-	-	583	583
		Customer operations-previous allocation to Eastern Markets	-	-	-	-	2,612	2,619	2,647	2,629	-	-	10,507	10,507
		Corporate operations-previous allocation to Eastern Markets	-	-	-	-	2,800	2,267	2,517	2,505	-	-	10,089	10,089
		Adjusted EBITDA attributable to Western Markets³	$ 18,248	$ 23,123	$ 27,456	$ 27,340	$ 30,197	$ 32,878	$ 33,307	$ 33,348	$ 96,167	$ 96,167	$ 129,730	$ 129,730

	¹	Adjustment for impact of recognizing a portion of the billed SNA contract revenues on a straight line basis.
	²	In 2014, Other includes legal and advisory fees related to new Sprint agreement and certain employee separation charges.
		In 2015, Other includes certain non-recurring corporate costs and adjustments for recognizing a portion of the deferred gain
		for towers sold to Grain Management, LLC.
	³	Western Markets was previously defined as Holdings less Eastern Markets and, for 2014, included the allocation of
		certain corporate expenses to the Eastern Markets.

SOURCE NTELOS Holdings Corp.

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