WideOpenWest (WOW!) unveiled plans to invest $215 million in capital expenditures this year, including $80 million in expansion efforts, and named Orange County, Florida as its second greenfield target market.
During an earnings call, CEO Teresa Elder said it expects to spend $40 million over the next two to three years to build fiber to more than 40,000 homes in Orange County.
The project is the second greenfield market the company has announced in the state. It named Seminole County as its first target earlier this month, outlining plans to reach 60,000 locations there. Together, the two builds will get WOW! halfway to a previously announced goal of expanding fiber to 200,000 locations by 2025.
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WOW! CFO John Rego said the greenfield work will contribute to an expected $80 million in expansion capex in 2020, with edge outs and commercial activity also included in this tally. While greenfield work has already begun, Rego noted the bulk of greenfield capex will really start to come into play in the back half of the year.
According to Elder, WOW! isn’t expecting to encounter any serious supply chain issues as it presses ahead with construction. “We actually are in a very good position with equipment and everything we need for the organic business and the growth we’re seeing there. Plus we have gotten ahead of the curve and the buying process for our greenfield markets,” she stated, “So we have months ago already gotten what we need to launch the markets and do what we need to do to meet the plans that we’re setting out for you.”
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Operator executives reiterated it expects to onboard its first greenfield customers in early 2023. John Rego, WOW!’s CFO, said on the call it believes it will hit “penetration levels in greenfield markets that are substantially higher” than its overall rate of 28%.
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Consolidated Q4 revenue fell 5% year on year to $178.3 million, with high-speed data (HSD) revenue up 5% to $100.5 million. The company posted a net loss of $2.2 million. Full year revenue dipped 1% to $725.7 million, as 11% growth in HSD sales to $399.1 million failed to fully offset losses in the company’s video and telephony businesses. Its full year net loss improved year on year from $108.3 million to $68.6 million.
WOW! gained 2,200 HSD customers in Q4, and 12,900 for the full year. It ended 2021 with 511,700 HSD subscribers. Elder said 87% of new customers purchased speeds of 200 Mbps or higher, with a majority of these buying speeds above 500 Mbps. It now has around 10,000 customers taking advantage of the government’s broadband subsidy through the Affordable Connectivity Program.