A ‘comfortable’ iPCS posts solid Q4 metrics: Wireless provider outlines 2009 goals

Regional wireless provider iPCS Inc. posted $9.8 million in losses for 2008, but the company remains optimistic it will continue to add customers and reduce churn.
In regard to subscribers, the Sprint Nextel Corp. affiliate said it added 61,200 net customers for 2008, short of the 68,600 subscribers the carrier added in 2007.
The company reported 2.3% monthly churn for the year compared with 2.5% for 2007. Overall, 2008 proved to be a better year financially compared with 2007, when the company posted losses of $69 million.
Timothy Yager, iPCS president and CEO, said in a statement that the company is pleased with its subscriber and financial results considering the current economic downturn.
“We continue to remain comfortable with our cash flow and overall liquidity for 2009,” Yager said. “Our capital structure continues to be attractive, particularly in today’s capital markets environment, as the earliest scheduled maturity of our secured notes in not until 2013.”
Yager also said iPCS was able to resolve disputes with Sprint Nextel, which the carrier said will result in a $4.3 million gain for the first quarter of this year. As a Sprint Nextel affiliate, iPCS sells wireless under the Sprint brand name in 81 markets that span the Midwest and East Coast.
Sprint Nextel and iPCS were engaged in a lengthy court battle following Sprint Corp.’s acquisition of Nextel Communications Inc. IPCS was able to argue successfully that the Nextel deal conflicted with its no-compete affiliation deal with Sprint Nextel. As a result of the case, Sprint Nextel must get rid of its iDEN networks in iPCS’ service areas.
IPCS’ fourth quarter
For the final quarter of 2008, the carrier reported revenue of $138 million, a decrease from $141 million in 2007. The carrier’s average revenue per user including roaming was $65 and $49 for without roaming
IPCS did post a loss of $100,000 for the quarter, which was a significant improvement from a year ago when the company lost $4.1 million in the final quarter of 2007.
Looking to 2010
Goals for iPCS this year are gross additions of 250,000 to 275,000 subscribers, capital expenditures between $35 and $45 million and free cash flow of $15 to $25 million.
Although one legal case is out of the way for iPCS and Sprint Nextel, a new one is brewing. In a case that is scheduled for the end of this month, iPCS officials claim Sprint Nextel is improperly withholding advanced technologies from iPCS and diverting those technologies to competitors.
Sprint Nextel has had trouble of its own; it recently had to lay off 8,000 workers. Sprint Nextel CEO Dan Hesse said he is committed to turning the company around.