What’s Frontier’s Outlook for the Rest of 2017?
Frontier’s outlook for 2017
Frontier’s (FTR) management expects to see advancements not only in revenue trends, but also in subscriber trends in 2017 and beyond. Also, the company expects to realize more cost containment and synergy realization. Frontier expects the synergy realization to come from the integration of AT&T’s (T) wireline business in the Connecticut market and Verizon’s (VZ) wireline business in the CTF (California, Texas and Florida) markets. Frontier completed the acquisition of AT&T’s wireline business in October 2014 and Verizon’s wireline business in April 2016.
During the Goldman Sachs Communacopia Conference on September 12, 2017, Perley McBride, Frontier’s chief financial officer, discussed the company’s full-year 2017 guidance. McBride stated that achieving adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of $3.8 billion by the end of 2017 is important to the company. In order to achieve this target, management acknowledged that top-line trends have to improve in addition to its cost-cutting initiatives.
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Wall Street analysts expect Frontier’s earnings to fall in 2017. Analysts expect the company to post an earnings per share (or EPS) loss of $4.13 in 2017 as compared to an earnings per share loss of $1.35 in the year-ago period.
Key points from Frontier’s outlook
Frontier’s management foresees adjusted free cash flow (or FCF) to be in the $800 million to $900 million range in 2017. Additionally, the company expects capital spending to be in the $1.1 billion to $1.2 billion range in 2017. Plus, the company’s management expects integration operating and capital expenditure amounts of under $50 million each. Also, the carrier anticipates zero cash taxes excluding any impact from legislation that may occur.