Awaiting Windstream Settlement, Uniti Group Reports 2Q Loss

Awaiting Windstream Settlement, Uniti Group Reports 2Q Loss
Kenny Gunderman (Uniti Group)

Uniti Group Inc. of Little Rock on Monday reported a second-quarter net loss of $588 million, a sharp reversal from a $41 million profit in the same quarter last year.

But total revenue was up 1% to $267 million, beating analysts expectations, as its Uniti Fiber unit saw high levels of new installations, President and CEO Kenny Gunderman noted in a news release.

"We continued to see strong operational performance across all of our businesses during the second quarter as the effects from COVID-19 remain minimal," Gunderman said. "At Uniti Fiber, we had one of our highest levels of install activity during the quarter, as demand for dark fiber, small cells and non-wireless services remains robust. We continue to see positive momentum in our leasing business, and will expand our leasable fiber to third parties by 90% as part of the Windstream settlement."

Uniti Leasing reported revenue of $185.3 million for the second quarter. Uniti Fiber contributed $79.1 million in revenue, and Uniti Towers brought in $2.4 million.

Last month, Windstream Holdings Inc. of Little Rock's Chapter 11 reorganization plan was approved by the U.S. Bankruptcy Court for the Southern District of New York. The plan remains subject to a settlement between Uniti, a spin-off company of Windstream, and Windstream and certain regulatory approvals. 

The company also said it would expand its partnership with Macquarie Infrastructure Partners, which recently purchased for $168 million an ownership stake in the entity that controls Uniti's Midwest fiber network assets. Uniti could receive a $20 million payout should the expansion plan it certain milestones.

On June 1, Uniti completed the sale of its U.S. tower business to Melody Investment Advisors LP for total cash consideration of $220 million. Uniti has retained an investment interest in the tower business through a Melody affiliate.

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