Frontier Communications announced that the company plans to exceed its target of 1 million fiber locations in 2022.
Frontier plans to accelerate the fiber build, and now expects to exceed its 2022 build target of 1 million fiber locations by an additional 100,000-200,000 locations, Frontier Chief Financial Officer Scott Beasley said at the MoffettNathanson Media Communications Summit.
Frontier continues to expect a cost of $900-1000 per passing for its Wave 2 build plan and is gaining construction efficiencies and productivity enhancements as the build scales.
The recent closing of $1.2 billion in additional debt puts Frontier in excellent position to accelerate its fiber build. Pro-forma for the debt offering, the company maintains its net leverage ratio of 2.5x, and has $4 billion of liquidity, which enables the company to fund the fiber build with cash on hand for approximately the next two years.
Frontier’s Q1 2022 capital expenditures were $447 million, an increase from $384 million in the first quarter of 2021, as fiber expansion initiatives accelerated.
Frontier reported revenue for the first quarter ended March 31, 2022, of $1.45 billion, a 10.7 percent decline, as growth in consumer fiber broadband was offset by declines in subsidy, video, voice, and wholesale.
Frontier’s consumer revenue declined 4.9 percent to $776 million, as strong growth in fiber broadband was offset by declines in legacy video, voice, and other.
Consumer fiber revenue of $407 million was flat. Consumer fiber broadband revenue rose 12 percent to $254 million, driven by growth in fiber broadband customers and consumer fiber broadband average revenue per user (ARPU).
Frontier’s consumer fiber broadband customer additions of 52,000 was the 11th consecutive quarter of positive consumer fiber net additions. This growth represents a four-fold increase from the first quarter of 2021, resulting in consumer fiber broadband customer growth of 11 percent.
Consumer fiber broadband customer churn of 1.19 percent improved from 1.41 percent. Consumer fiber broadband ARPU of $62.10 increased 2.3 percent, as price increases and speed upgrades were partly offset by the introduction of autopay and gift-card incentives in the third quarter of 2021.