Good morning, everyone, and welcome to the Shenandoah Telecommunications Fourth Quarter and Year End 2015 Earnings Conference Call. Today's call is being recorded. At this time, I would like to turn the conference over to Ms. Adele Skolits, CFO. Please go ahead.

Good morning and thank you for joining us. The purpose of today's call is to review Shentel's results for the quarter ended December 31, 2015. Our results were announced in a press release distributed this morning, and the presentation we'll be reviewing is included on the Investor page of our Web site at www.shentel.com. Please note that an audio replay of the call will be made available later today. The details are set forth in the press release announcing this call. With us on the call today are Christopher French, our President and Chief Executive Officer; and Earle MacKenzie, our Executive Vice President and Chief Operating Officer. After our prepared remarks, we'll conduct a question-and-answer session. As always, let me refer you to Slide 2 of the presentation, which contains our Safe Harbor disclaimer and remind you that this conference call may include forward-looking statements subject to certain risks and uncertainties. These may cause our actual results to differ materially from these statements. Shentel provides a detailed discussion of various risk factors in our SEC filings, which you're strongly encouraged to review. You're cautioned not to place undue reliance on these forward-looking statements. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements. Also, in an effort to provide useful information to investors, we note on Slide 3 that our comments today include non-GAAP financial measures. Details on these measures, including why we use them and reconciliations to the most comparable GAAP measures, are included in our SEC filings. These reconciliations are also provided in an appendix to today's slide presentation. I'll turn the call over to Chris now.

Thank you, Adele. We appreciate everyone joining us this morning. We had a strong fourth quarter capping off a great year and I'm pleased to have this opportunity to provide details about the Company's continued growth. During the quarter and the year, we delivered an expanded customer base, revenue growth and improved margins. In addition, the team delivered these results while also positioning the Company to scale dramatically through our pending acquisition of nTelos. On Slide 5, you'll see that fourth quarter 2015 net income increased 40% to 12.1 million compared to the prior year. All three segments contributed to this improvement. For the quarter adjusted operating income before depreciation and amortization or OIBDA increased 17.5% to 40.1 million. Revenues were 87.3 million in the fourth quarter, a 5.4% increase from the prior year period. Revenues increased chiefly as a result of subscriber growth and improved product mix. Our cable segment revenues improved as a result of an increase in the number of revenue generating units or RGUs and higher average revenue per customer due to video rate increases and customers increasingly selecting high-speed data packages. On an annual basis as you see on Slide 6m consolidated 2015 revenue grew 4.8% to 342.5 million and adjusted OIBDA increased 14.2% to 150.9 million for the year. Slide 7 illustrates the 19.7% growth in operating income to 74.1 million and a 20.6% increase in net income to 40.9 million for 2015. Our Wireless highlights start on Slide 8, we experienced solid growth in our Wireless segment with an 8.6% increase in customers for our postpaid offering as result of our upgraded network leveraging Sprint’s national marketing and providing high-quality local customer service. We saw a slight decline of 1.6% in our smaller prepaid customer base, but saw net prepaid service revenue increase…

Thank you, Chris. I’ll begin on Slide 13 which shows our growth and profitability. In the top-line, you can see that we had nearly a $5.4 million or 33% increase in operating income for 4Q15 over 4Q14, over the same period net income is up 40% and earnings per share is up 33%. Turning to Slide 14 for the year ended December 31, 2015, operating income was up $12.1 million or 19.6% over 2014. As you can see 4Q15 adjusted OIBDA is up nearly $6 million over 4Q14 or 17.5%. For the year ended December 31, 2015, adjusted OIBDA is up $18.8 million or 14.2%. These improvements are consistent with longer term trends as you can see on Slide 15 while it's provided the long-term view of adjusted OIBDA, since 2010 adjusted OIBDA has grown by $66.9 million, this represents a compound annual growth rate of 12.4%. To better understand the forces driving results in all three of our segments, I've provided the fourth quarter OIBDA results by segment on Slide 16. Adjusted Wireless OIBDA has increased by $900,000 or 4% while Cable results have improved by $3.9 million or 90%. Wireless results have increased by $1.8 million or by 28%. On Slide 17, I've analyzed the changes in adjusted Wireless OIBDA results between 4Q14 and 4Q15, the cost for a prepaid customer acquisition and support cost have dropped by $1.4 million between 4Q14 and 4Q15, this as a result of a 9.8% drop in the number of prepaid gross additions and a drop in the rate Sprint charges to Shentel to support these customers. As a result of the growth in the average billing rate per prepaid customer of 7.3%, prepaid revenues grew by $900,000. This growth is driven by a shift in the mix of customers to the…

Thank you, Adele and good morning everyone. I'll pick up on Slide 21, we ended the year with 312,512 post-paid customers an increase of 24,645 in the past 12 months. We ended 2015 with 455,352 total customers. We continue to see an increase of smartphone penetration with 82% of our post-paid users having a smartphone at year-end. 95% of the smartphones are LTE capable with 75% also having 2.5 gigahertz enhanced our LTE capabilities. Slide 22 shows are exceptional post-paid fourth quarter. We added 8,985 post-paid users, an increase of 84% from last year. We had 1,277 more gross adds primarily the reason for the higher net adds with churn at 1.48% compared to 1.92% in the fourth quarter of 2014. Our 2015 churn rate is lowest in our history. We continue to have a very favourable porting ratio compared to all carriers with the overall porting ratio of 2.5 to 1 with a majority being prime credit class customers. The percentage of sales coming through our stores are comparable year-to-year. The strong fourth quarter results are a combination of a very good network and a strong local distribution strategy. Let me add a few more stats, phones represented 87% of our fourth quarter net adds with the remainder being tablets and connected devices, we continue to focus on the quality of net adds with a focus on adding higher service revenue phones rather than much lower service revenue tablets. 25% of gross adds were on subsidized plan, 54% on lease and 21% were installment sales. Fourth quarter upgrades were 10.6% of our base, with 33% selecting subsidized plan, 51% lease and the remaining 15% installment sales. As of December 31st, 55% of our base remains on subsidized plans. The enhanced pass off promotion started November 18th approximately 15% of…

This concludes our prepared remarks. Tyron would now review the instructions for posing a question.

Absolutely. [Operator Instructions] Our first question is from Ric Prentiss of Raymond James. Your line is open.

A couple of questions, first I appreciate the update on the nTelos timing and the added cost, is there any switch to the CapEx and Earle earlier you mentioned like a $122 million for them, is there any change on that CapEx or timing is any for it back sliding into ’17 then?

No actually what -- because the delay in the closing nTelos has continued to build and so actually some of the CapEx that we had initially planned that we would have to pay for has been covered by nTelos and that's probably in the $10 million range or so. And that's making the assumption that we’re going to be able to close here end of March or early April, if the closing gets pushed out further then they will continue to build, the one great thing Ric is that we're not planning on any kind of a slowdown on the upgrade. The transition is going to be smooth and continuous.

And then obviously a lot of moving pieces in the wireless in the industry these days with leasing and EIP and competition, as you step back from it what are your thoughts as far as what the trend lines looks like let’s talk Shenandoah markets not nTelos because that’s got some -- any things on ARPU and churn and take rates of these different type plans?

Well, I think as far as churn, we have had several quarters in a row now that we have been bumping right at the 1.4 area and I really don't see that there is anything in it that at this point that I see is going to change that. I think churn is going to remain in that 1.4 to 1.5 range. We have seen -- what has really has shifted is more and more folks going to lease from the installment sales. We've continued to see a relatively solid 25% to 30% of customers who want to stay on the subsidized plans and feel comfortable with that kind of approach. We did see over the 12 months a fairly significant drop in ARPU, but we had just less than $1 decrease in the -- between the third and fourth quarter and I think that's partly -- we're starting maybe towards seeing some stabilization in pricing as we're kind of getting a better look at what their overall mix is going to look like going forward. The one thing that we have been doing though is using the enhanced cut your bill in half that Sprint implemented towards the end of 2015, we used every opportunity when the customers came in and we did have increased door traffic as a result of that promotion so it was a positive promotion for us, but as I have stated only 15% of our gross adds actually took it, so we once again focused on our effort to have a consulted sale and even when the customer wanted to take advantage of that promotion we're able to move them up so that they were paying exactly half of what they were paying at AT&T or Verizon, but they're paying more than half and getting maybe a bigger bucket of data and so we think ultimately that customer will be happier, they'll have more data without getting any overages and we got more than half of what they were spending at AT&T and Verizon, so we see that as a positive development for us.

And a lot of the speculation in some industry reports and press about Sprint's network plans, can you update us as far as where you are as far as VoLTE voice over LTE in your network and is there a need to do any kind of changing out or massive network densification in your territory or the nTelos markets?

Sprint have said that that they will be moving to voice over LTE but that they do need to continue their densification before that's going to be a reality the good news for us is we're already there, but we are not going to launch it prior to Sprint we're going to basically do it with Sprint. When we look at the nTelos area, there the density of their market is going to look similar to ours once we have finished our upgrades and so if you look at kind of towards the end of 2017 early '18, we should be there in the nTelos footprint and I think that's going to dovetail nicely to kind of where Sprint will be on voice over LTE. So, I think we're going to be in great shape.

And no plans of doing any kind of change also to your base network or what you're planning to do in nTelos?

No, really when you look at our -- the fact that we have over 550 sites covering 2 million people we already have a very dense network, we'll continue to look at pockets where we potentially could use small cells, we're continuing to add some capacity sites even though we are getting additional spectrum but we feel very good about where we are as far as overall quality of network.

Thank you. Your next question is from Barry Sine of Drexel Hamilton. Your line is open.

First question on the news that you've disclosed on the nTelos handsets not being able to be migrated over, that seems like a fairly significant change, was there any discussion or potential to renegotiate the terms of the transaction to compensate you for those additional costs?

Barry it is Earle, no, we have not attempted to renegotiate the transaction, it really was an issue between ourselves and Sprint, in good faith all the parties thought that we were going to be able to migrate those phones but as we got into the details of doing that we realized that it just wasn't going to work and so what we've done is we've pivoted to that how can we minimize the cost to us and minimize the impact on the customer by changing out those phones, so it -- that's the reason why we have I think then being very realistic and saying it is going to take us 18 months or so to do that, we are going to -- we're working on and have a communication is plan when we will have customers make appointments and come in and review their account, put a different phone in their hand, the good news is that a third or more of the phones is simply just changing out the SIM card but it will -- for all Android phones we'll have to put a new phone in their hands.

And can you explain exactly what is it in the phone, it sounds like it's a hardware issue, I mean if it was software you could just renew the software in the phones, in terms of mitigating the cost it sounds like you can give them the same model handset refurbished and then take the old handset back and then sell that to recoup some of the costs is that [Multiple Speakers]?

And that's exactly what we are going to be doing, we have -- we don't necessary carry all the same phones or Sprint doesn't carry all the same phones that nTelos did, but what we've done is we've gone through the effort of matching up every nTelos phone to a Sprint phone and either on a reconditioned or a new phone. And then we will be taking up the nTelos phone in as on trade and there will be -- we will be able to recoup some dollars from that, but it is just a different approach, Sprint’s phones don’t work on the nTelos networks, and nTelos phones don't work on the Sprint network as far as not so much the network itself but it's the back office systems. And a lot of effort was made to see if we could make it work, but it just -- we were pushing rope at that point and decided we just needed to change out the phones.

And then next question, could you give us an update in the past you've talked about Sprint network quality in the joining markets and that's been a bit of an issue, how have they come along, is that still a bit of an issue? And then one way obviously for them to improve their network quality would be to expand Shentel's affiliate footprint maybe you could comment on the potential there?

Well, the good news is that Sprint is making some great progress as far as upgrading their network. We are seeing the positive impacts of that, not so much, to be perfectly honest in the areas right next to us. But as you are looking at, at the or using the Washington Baltimore area as an example, the network there is getting better and better and they're pushing out further and further into the suburbs, the upgrade and the densification of that network and that does benefit us. But there are still areas where we have handoff areas where the coverage is weak on the Sprint side. And we've been very honest about telling everyone that we have continued to have ongoing discussions with Sprint about those areas and one of the options is certainly to expand our footprint to include some of these outer suburb areas which probably have a much stronger community of interest to us than they do to the metropolitan areas that Sprint’s focused on. But upgrading and improving the coverage in those areas will benefit both of us. So I guess to kind of a summarize, things are better Barry, there are still some issues that we're addressing. But we're having some very fruitful discussions with Sprint about how to solve that.

And then Earle on Slides 33, you gave a pretty good breakdown of capital spending for 2016, just conceptually beyond that you've talked about a multiyear plan for adding additional cell sites for nTelos, I am assuming 2016 is probably the high watermark and there is also some things you're doing in the Shentel footprint, could you give us any rough directional guidance of what you think CapEx is going to be like in the out years?

Yes, I think we said that for 2018 finishing up the major push on the -- the major push for finishing the nTelos upgrade in ’17 will be about $90 million. And if we don't have a major fiber bill or acquire another cable company, we believe that the remaining CapEx will be down in the 70 million to 80 million range that we've had the last two years. So I think when you kind of look at the total, we're kind of looking at $150 million to $160 million for 2017 and then beyond that we will be past the major upgrade and expansion of areas and nTelos area. And then we probably said that it drops to the 120 million range in the 2018 and beyond without a new acquisition.

Okay, and one more question for Adele, tough question, what's the timing on filing the 10-K?

That would be this afternoon.

[Operator Instructions] The next question is from Hamed Khorsand of BWS Financial. The line is open.

Could you just talk about the operational scale that you achieved in Q4, is that going to be consistent going forward given that roll off in what you're seeing in Wireless right now?

I think when we look at that the 2016, if you exclude the kind of the nTelos change which will obviously be significant for us, we think that the momentum and the -- that we had in the fourth quarter continues through 2016, there always is the issues of different quarters, there is some seasonality. But when you kind of look that the total -- in totality 2015 and look in totality 2016, we don't see any significant changes between the two years. We think the momentum will continue.

But what I was specifically relating to because it seems as though you are generating 87 million in revenue provided a lift as far as the scale goes as far as operating margin goes, so moving back to transfer over to 2016 at Q4's rate given that most of the benefit came from your cable TV side?

Yes, I mean that's a great part of our business is that we have hundreds of thousands of customers that pay us the kind of recurring revenue. There will be some continued deterioration in ARPU in the Wireless business as we continue to convert more customers to lease and installment sales, but on the Cable side those are pretty solid, that -- the great fourth quarter was driven primarily by broadband and those customers are continuing to buy broadband from us and continuing to buy bigger broadband pipes. We also continue to have very good growth in voice services, once again a very high margin business for us because of the fact that we own the middle mile and the switch, I already mentioned that we've lost some video customers because we decided to drop the AMC channels, but what's been interesting is that we virtually lost no broadband or voice services as part of this because customers even though had a triple play they did drop the video and went to either or DISH or DIRECTV to keep the walking dead but they kept our broadband and phone product so which is really kind of our objective because those are the high margin business for us and we've been pretty open by saying that if we lose video only customers we are okay with that.

How much longer you think you'll have to endure this ARPU transition in Wireless?

I only wish I knew, I think my opinion is, is that we are in U and at some point in time when there's stabilization of kind of the way customers want to buy their phones and as customers continue to use more and more data they will be buying bigger data buckets or using overages and so I do think that the average revenue will go back up but I would be hard pressed to predict exactly where the bottom of that U is.

And them so what are you guys assuming as far as the nTelos acquisition goes and the transfer over of those subscribers?

So from an ARPU standpoint we are basically bringing them all over at their current price plan, so there's not going to be a significant change on day one, but overtime we hope to use the same approach to consultant sales that we use in our own area, try to move customers to price plans that are in their best interest, move them up to a higher data bucket and increase the ARPU there, but we have committed both to the customers and to the FCC that our plan on day one is to migrate them over at their same price plans.

I understand that, but -- and then nTelos also are exposed to all plans and schemes moving away from subsidized phones, so weren't you be exposed to it as well?

Well -- but they have already been doing that I mean they don't offer a lease but they've been offering the opportunity to buy an installment plan and a significant percentage of their base is already there so there will be some impact, but we don't believe it's going to be dramatically different than ours.

Thank you. There are no further questions at this time. I'd like to turn the call over to management for any closing remarks.

Thank you for participating. I'd like to invite you to let me know if there are additional details you'd like to see us cover in the future. My contact information was provided on the press release.

Again ladies and gentlemen, this does conclude today's conference. Thank you for your participation. You may now disconnect.