FYBR - Frontier Communications Parent raises cost saving target after strong Q3 results

• Frontier Communications Parent ( NASDAQ: FYBR ) added 66,000 fiber broadband customers, +15.8% Y/Y .
• The company built fiber to a record 351,000 locations to reach a total of 4.8M fiber locations, nearly halfway to our target of 10M fiber locations.
• The company saw a sales decline of 8.4% Y/Y despite growth in consumer fiber broadband which was offset by declines in subsidy, video, voice, and wholesale.
• Consumer revenue declined 1.9%; Consumer fiber revenue increased 3.6%; Consumer fiber broadband revenue increased 14.4%.
• Consumer fiber broadband customer churn of 1.60% increased from 1.56% in the third quarter of 2021, primarily due to higher involuntary disconnects.
• Consumer fiber broadband ARPU of $62.97 declined 0.6% Y/Y.
• Business and wholesale revenue declined 7.5%; Business and wholesale fiber revenue increased 1.1%.
• Business fiber broadband customer churn of 1.36% increased from 1.26% year ago.
• Business fiber broadband ARPU of $107.28 increased 2.4% Y/Y.
• Adjusted EBITDA margin was 35.2% vs. 37.2% year ago.
• The company achieved our $250M gross annual cost savings target more than one year ahead of plan, enabling us to raise our target to $400M by the end of 2024.
• FY2022 Outlook: Adjusted EBITDA of $2.05B - $2.15B; Fiber build of 1.1 - 1.2M new locations; Cash capital expenditures of $2.50B - $2.60B; Cash taxes of approximately $20M; Net cash interest payments of approximately $485M; Cash pension and OPEB expense of approximately $75M (net of capitalization); Cash pension and OPEB contributions, including a catch-up from contribution waivers during bankruptcy, of approximately $135M.

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