Uniti Group Inc.

quarter 2021 conference call. My name is Cynthia and I will be your operator for today's call. The webcast of this call will be available on the website www.unity.com beginning May 6, 2021 and we will remain available for 14 days. At this time, all participants will be in listening-only mode. Participants on the call will have the opportunity to ask questions and follow the company's prepared comments. The company would like to remind you that today's remarks include forward-looking statements and actual results could differ materially from those projected in these statements. The factors that could cause actual results to differ are discussed in the competent filings with the SEC. The company's remarks this afternoon will reference slides posted on its website and you are encouraged to refer to those materials during this call. Discussions during the call will also include certain financial measures that were not prepared in accordance with generally accepted accounting principles. Recommendation of those non-GAAP financial measures to the most directly comparable AAP financial measures can be found in the company's current report and form 8K dated today. I would now like to turn this all over to Unity Group's Chief Executive Officer, Kenny Gunderman. Please go ahead, Mr. Gunderman.

Thank you, Cynthia. Good afternoon, everyone. Joining me on the call today is our Chief Revenue Officer, Ron Mudry. In lieu of Mark, given our strong momentum at Unity Leasing, we thought it would be appropriate to make Ron available for this call. Before I review Unity's operational performance for the first quarter, I'd first like to highlight some trends we're seeing in the communications infrastructure space. As slide four of our presentation illustrates, fiber is the mission critical connective tissue for virtually all current and future broadband delivery. We're seeing an acceleration of the virtualization of our culture with 5G mobile broadband, fiber to the home, fixed wireless, over-the-top video, and other technologies enabling greater usage of video conferencing, e-learning, telemedicine, remote work environment, and an overall continued surge in broadband traffic. Unity is one of the largest independent wholesale fiber providers in the country and provides fiber to a full range of communication service providers. As such, we're agnostic to competing edge technologies as we eventually benefit from virtually all of these broadband trends that feed traffic to our fiber network. In the past four years, for example, our southeast fiber network has seen a roughly 10 times increase in peak daily traffic from 16 gigs to 160 gigs, and we expect that trajectory to continue. Our wireless carrier customers are particularly active in an effort to keep their underlying infrastructure ahead of the explosive growth in mobile broadband. These carriers are increasingly looking for 10 gig upgrades on our macro tower backhaul circuits, while simultaneously continuing to push for C-RAN small cell deployments in our metro markets and accelerating their 5G network densification. As a result, our dark fiber and small cell revenue grew 30% from the prior year during the quarter, We expect those trends to continue, especially with DISH now becoming a more active customer. Our non-wireless carrier customers, such as the FANG Group and National MSOs, are also active as they expand their cloud-based services. Their insatiable demand for high-capacity, long-haul routes, in particular, continues to accelerate. For example, we saw a 30% increase in the monthly MRR being quoted to FANG customers in March alone versus the end of last year. Our residential and enterprise-focused carrier customers are equally active during driving broadband to more and more consumers. Our dense metro networks today pass 185,000 buildings, and we're aggressively building deeper into commercial parks and neighborhoods through fiber to the home and fixed wireless fields. Over the past three years, we've built over 7,000 route miles of new fiber, and we expect that number to potentially triple over the next three years. Turning to slide five. Unity continues to address these significant industry tailwinds with the eighth largest fiber network in the country and a growing portfolio of small cells, connected buildings, macro towers, and homes past. We've amassed this valuable and hard-to-replicate portfolio in only six years through our proprietary M&A efforts and organic sales strategy, and our portfolio is growing every day. As you know, we're very engaged with the M&A market, and we know that private and strategic capital are valuing similar portfolios at 15 to 25 times cash multiples. So we're confident that we're creating shareholder value every day. As evidenced on slide six, fiber provides an attractive shared infrastructure model that can drive meaningful returns. Unity acquires or builds new fiber with attractive long-term anchor cash flow economics in the mid to high single digits. We then add additional tenants with very high margin and minimal capex, resulting in combined cash flow yields of approximately 17%. We believe our past success is indicative of our future potential, as we continue to see tremendous demand for new anchor customers, as well as realize lease-up success. Turning to slide seven, at Unity Leasing as a national wholesale provider across 42 states, We're driving highly profitable, passively managed lease-up revenue on our long-haul and metro routes and opportunistically growing our portfolio through proprietary M&A. At Unity Fiber, we're targeting less competitive Tier 2 and 3 markets, largely in the southeastern U.S., and providing actively managed fiber solutions to wireless customers, as well as enterprise, schools, and government entities. Our strategy of targeting these underserved markets along with our national scale and customer relationships is driving unique demand. Slide 8 highlights the success we've had in leasing up our southeast fiber network where we have substantial dense metro fiber. To date, we've sold over three times the recurring revenue on the major wireless anchor builds that have been completed. Over the past five quarters, we've sold approximately $17 million of annualized lease-up MRR that is expected to generate incremental cash yields of over 50%. Including the lease-up to date we've sold since we began construction on our major wireless bills, we expect to generate a cumulative cash yield of 14% on these projects, doubling the initial anchor yield. These relatively new networks remain highly underutilized, and the expected additional lease-up in the coming years will continue to increase our cumulative cash yields. In addition to focusing on leasing up our existing network, we'll continue to pursue select attractive anchor greenfield builds and lease up those networks with a mix of additional wireless and non-wireless customers. During the quarter, as I mentioned earlier, dark fiber and small cell revenue grew 30% from the prior year, while enterprise revenue grew 17%, demonstrating that we're choosing good anchor markets to expand our network in a disciplined manner and that we're executing well on follow-on lease-ups. Unity Fiber sales bookings in the first quarter were approximately 0.5 million of MRR, and 90% of our sales bookings came from non-wireless customers. Unity Fiber installed 0.5 million of MRR during the first quarter, with 68% of gross installs related to non-wireless, 24% related to wireless, and 8% related to bandwidth upgrades. I'll now turn the call over to Ron, who will provide an update on Unity Leasing.

Thanks, Kenny, and good afternoon, everyone. Turning to slide 9, at Unileasing, we continue to actively market over 3 million strand miles of fiber that is available to lease to third parties, making us one of the largest players in the wholesale fiber market. Our sales pipeline today stands at approximately $1 billion of total contract value, which translates to approximately $60 million of potential annual recurring revenue. This reflects the continued significant interest from our wholesale customers as well as the strategic value of these fiber strands. Approximately 75% of the deals utilize fiber we acquired as part of the settlement with Windstream, and our success is the result of less than one year of actively marketing this new fiber. We continue to be successful in monetizing our portfolio of assets, and to date have executed on opportunities that represent total remaining revenues under contract of $765 million, with an average contract term remaining of 14 1⁄2 years and incremental cash flow yields of approximately 12%. As slide 10 illustrates, we have executed and continue to pursue several different types of opportunities within our Unity leasing segment. Traditional dark fiber IRUs and dark fiber leases have driven over $60 million of upfront proceeds and $345 million of remaining revenues under contract, primarily on the fiber we acquired from Lumen and Windstream. These opportunities generate margins of 90% plus with minimal to no CapEx required. Sale leasebacks are structures where we acquire new fiber to expand our network reach and then immediately enter into a long-term lease with a tenant to provide anchor return economics. Our transactions with TPX, CableSouth, and others over the past years are examples of these. Opco propco are transactions where we sell our existing actively managed lit services revenue at double digit transaction multiples to an operating partner and then immediately lease access to the underlying fiber network, which we retain in the form of a 10- or 20-year IRU or lease. These transactions generate upfront proceeds, grow net contractual revenue, and extend the average term of revenue substantially. For example, we sold our Midwest fiber operation as part of the Bluebird transaction, and we recently added into a transaction to sell our Northeast operations as part of our Everstream transaction. Over the past two years, we have generated total upfront proceeds of approximately $400 million from these various transaction structures. Turning to slide 11, during the first quarter, Unity Leasing deployed approximately $43 million towards growth capital investment initiatives with almost all of these investments related to the Windstream GCI program. These GCI investments were mostly ILEC-related and added approximately 800 route miles and 38,000 strand miles of valuable fiber to Unity's own network across 13 different ILEC states. As of March 31st, Unity has invested approximately $127 million of capital to date under the GCI program with Windstream, adding approximately 3,375 route miles and 122,000 fiber strand miles. These investments will be added to the master lease at an 8% initial yield at the one-year anniversary of Unity making the investment, subject to a 0.5 annual escalator, and results in near 100% margin revenue. The investments we have made to date will ultimately generate approximately $10 million of annual cash rent. In 2021, we continue to expect to deploy $200 million of capital related to the GCI program, primarily within Windstream's ILAC markets. Most of these markets are similar to our own Tier 2, Tier 3 markets, providing Windstream with substantial growth opportunities over time. As a reminder, the investments Unity is committed to making must meet certain underwriting criteria, including being long-term value of creative fiber and meeting minimum threshold returns for our tenants. Each request made by Windstream is reviewed by Unity to ensure it meets the criteria. Said differently, The program is designed to not only ensure investments are being made to help our tenant now, but also facilitate future proofing Unity's network for future renewals. With that, I'll turn the call back over to Ken.

Thanks, Ron. Our guidance remains largely in line with our prior outlook. We still expect to close our transaction with EverStream in the second quarter of this year. Upon closing of the transaction, we expect to record a pre-tax book gain of $25 million relating to the partial sale of our Northeast operations and sale of certain dark fiber IRU contracts. The gain is excluded from both adjusted EBITDA and FFO. Turning to slide 12. We reported consolidated revenues of $273 million, consolidated adjusted EBITDA of $214 million, AFFO attributed to common shares of $103 million, and AFFO per diluted common share of $0.41. Net loss attributable to common shares for the quarter was $5 million, or $0.02 per diluted share, and excludes $4 million of transaction-related and other costs. At Unity Leasing, we reported segment revenues of $195 million and adjusted EBITDA of $192 million, up approximately 6% and 5% respectively from the prior year, while achieving an adjusted EBITDA margin of 98%. At Unity Fiber, we turned over 160 lit backhaul, dark fiber, and small cell sites for our wireless carriers across our southeast footprint during the first quarter. We currently have approximately 1,100 lit backhaul, dark fiber, and small cell sites remaining in our backlog that we expect to deploy within the next two years. Unity fiber revenues of $78 million and adjusted EBITDA of $30 million during the first quarter were in line with our expectations, with adjusted EBITDA up 8% from the prior year, primarily due to the wind down of our non-core construction business and lower operational and maintenance costs. adjusted EBITDA margin for the quarter was 38%, representing a 270 basis point improvement from the prior year. Turning to slide 13, we're revising our prior guidance for the impact from the recent issuance of our four and three quarters secured notes and related redemption. The impact of transaction related costs incurred to date and changes in estimates of depreciation and amortization. At Unity Leasing, we continue to expect revenues and adjusted EBITDA to be $784 million and $766 million, respectively, at the midpoint, representing adjusted EBITDA margins of approximately 98%. As slide 14 highlights, non-windstream revenues and adjusted EBITDA continue to grow at a healthy pace and are expected to be $55 million and $42 million, respectively, up 27% and 17% from 2020 levels. This includes the assets and dark fiber IRU contracts we acquired from Windstream, where the revenue is diversified across multiple third parties and the dark fiber IRU leases that are part of the EverStream transaction. For full year 2021, our guidance continues to include lease up of our national fiber network with opportunities that are expected to generate $5.5 million of annualized revenue when fully deployed. As a reminder, the bookings associated with this lease up are expected to be more heavily weighted towards the back half of this year, given the typical sales cycle. Therefore, the full year revenue run rate impact is not expected to be realized until next year. Turning to slide 15, we still expect UnityFiber to contribute $305 million of revenues and $118 million of adjusted EBITDA, representing a margin of 39% this year at the midpoint of our guidance, which is a 300 basis point improvement from last year. As we pointed out on our earnings call last quarter, UnityFiber's outlook is impacted by the sale of our Northeast operations as part of the EverStream transaction and the winding down of our non-core construction business I noted earlier. Adjusting for the impact of these two items, revenue and adjusted EBITDA for 2021 at UnityFiber are expected to increase 6% and 10%, respectively, from the prior year. Turning to slide 16, for 2021, We continue to expect full-year AFFO to range from $1.61 and $1.65 per diluted common share with a midpoint of $1.63 per diluted share. On a consolidated basis, we expect revenues to be $1.1 billion and adjusted EBITDA to be $852 million at the midpoint. Our guidance contemplates consolidated interest expense for the full year of approximately $395 million excluding any deferred financing cost write-offs and premiums paid relating to early retirement of our debt. Reported interest expense in 2021 will include an additional $51 million relating to the write-off of deferred financing costs and premiums paid on the early retirement of our 8.25% senior unsecured notes and 6% senior secured notes due 2023. We continue to improve our financial flexibility and lower our borrowing costs. On April 20th, we successfully closed on the issuance of $570 million of senior secured notes due April 2028. These notes will bear interest at 4.75% and were issued at par. The proceeds from the offering were used to redeem in full the outstanding 6% senior secured notes due 2023, which occurred today. Combined with the refinancing of our 8.25% unsecured notes, which were fully redeemed on April 15th, we expect to realize annual interest cost savings of approximately $25 million and have extended our debt maturities by several years. At quarter end, we had approximately $523 million of combined unrestricted cash and cash equivalents and undrawn revolver capacity. Our leverage ratio at year end stood at 5.83 times based on net debt to annualized adjusted EBITDA. In closing, as slide 18 highlights, Unity remains a unique opportunity in the communications infrastructure space with a differentiated strategy and a unique, hard-to-replicate REIT structure and portfolio of assets with attractive economics, including 95% recurring revenue, monthly churn of 0.3%, company-wide net success-based capital intensity of 30%, and $8 billion of revenues under contract, with nine years of average term remaining. Our proven track record of organic growth execution, our proprietary value accreted M&A funnel, and the fact that we are still in the early years of a multi-year investment cycle provide significant growth tailwinds for the foreseeable future. With that, operator, we are now ready to take questions.

Thank you. We will now begin the question and answer session. If you have a question, please press stars and 1 on your touchtone phone. If you wish to be removed from the queue, please press the pound sign or the hash key. If you're using a speakerphone, you may need to pick up the handset first before pressing the numbers. And once again, if you have a question, please press star and 1 on your touchtone phone. We are standing by for questions. And our first question comes from Frank Luthan with Raymond James. You may go ahead with your question.

Great, thank you. Maybe walk us through the DISH situation and how you see yourself benefiting from that and how broadly across your network. Thanks.

Sure, Frank, thanks. Yeah, we don't like to talk specifically about customers, but DISH did name us in a press release at the end of last year, as you know, so happy to provide a little more color. And I think we've been foreshadowing this, but we really think the second half of this year could be very, very active with DISH. especially in the southeast. We've got a number of markets that are on the list for them for deployment, and we're going to be active, we think, in those markets. And I think that's just the beginning based on everything we're seeing and hearing, and we look forward to the activity ramping.

All right, great. Thank you.

And our next question comes from Phil Kufic with JP Morgan. You may begin with your question.

Hey guys, thanks. Hi, thanks. You mentioned growth in small cell deployments in metro markets and increasing 5G network densification. Can you just expand on that and what kind of spectrum you're seeing deployed? Thanks.

Yeah, Phil, this is Kenny. I'm going to start with that and then ask Ron to add some comments because Ron, it engages a lot with our big carrier customers, but we've always said that small cells were not a central part of our strategy. They were more of an addition to our core strategy. We've also said that in our tier two and tier three markets, small cells would be behind in terms of deployments, behind meaning come later in terms of timing relative to the larger NFL cities. And we've also said, but eventually, those deployments would start to ramp. And when they did, us having fiber in those markets would give us a leg up on competition from a speed to deployment and just an economics point of view. And we're starting to see that. We're in the early innings of that. And eventually... I think the spigot is going to be really open, and right now we're starting to see good deployments across the spectrum of large wireless carriers. And so pretty excited about it. Again, it's not the core central part of our strategy, but it's really great. provide great economics either as lease up on existing networks or they can be good anchor economic networks for us when we're able to deploy them in current markets or adjacent markets. Ron, feel free to add to that if you'd like.

Sure. Thanks, Kenny. Thanks, Phil. I would say that the recent C-band spectrum option is going to be driving some significant That spectrum will be put out on towers that have other spectrum carrying on them as well. So it's actually driving a very significant ramp up in bandwidth requirements at lit sites, actually all the way up to 10 gig. As Kenny had mentioned, we have multiple carriers looking for that now, and also increasing our demand for dark fiber. So I think that that's going to be a continuing trend over the next two to three years as the carriers look to activate that new spectrum as it's clearing. Okay.

Thanks. Ron, for the small-cell side, are you seeing one carrier mostly driving this, or is it really more than one or all the major carriers? Thank you.

I mean, we have activity with all the major carriers, I would say, in the small-cell space, and continue to see that.

Great. Thanks, guys.

And our next question comes from Michael Rollins with Citi.

Hi, good afternoon. Just a few questions. On slide eight, it looks like the incremental lease up in the blue cumulative MRR in the left is up about 0.2 million off of last quarter. And just curious on that, you know, how to think about the pacing of this growth and how you would evaluate that outcome in, you know, the range of expectations you have. And then on slide nine, just a little bit more context about the growth of opportunities you're seeing in terms of the quantity of numbers going from 140 to 186 and the contract value staying around a billion. Is the mix or the type of business that you're now seeing in the pipeline today versus what you maybe saw a couple of months ago shifting a little bit? Thanks.

Sure, Michael, it's Kenny. I'll start with your first question and then ask Ron to comment on your second. I think on the lease up, whether it be at Unity Leasing or at Unity Fiber, and we're really trying to show both. There's lots of different ways to look at it, but ultimately we're extremely pleased with both. And the lease up, you know, again, LeaseUp is wireless or non-wireless. It could be the second wireless tenant or the third wireless tenant or it could be an enterprise or school or government entity. We're relatively agnostic to that. And so in terms of the pacing and the trajectory, I think it's been steady from the time we've deployed many of these networks. and it's been steadily building, as you would expect. So you get into these markets, you're building more and more network, you're establishing more and more of a presence with customers and more and more of a brand, and it just builds on itself, and that's exactly what we've been seeing. So very pleased with it, expect it to continue. And I think, importantly, we've said this in the past, I can't remember if it was in our prepared remarks today or not, but most of these networks, including our national network, is highly underutilized, meaning there's a tremendous amount of capacity in the network already that we can deploy without a substantial amount of additional capital. So, very pleased with the progress there. Ron, you want to comment on the second question about the leasing funnel?

Sure, thank you. So I would say, if you recall, we've only been actively marketing this new fiber that we got through the Windstream settlement for a short period of time, you know, relative to the sales cycle. Dark fiber has a much longer sales cycle than lit services does. And as we've been developing the sales funnel, I would say that opportunities are becoming better qualified. You know, of course, some drop out of the funnel because we've closed them. Others drop out because they don't qualify for some reason. But overall, we've seen a steady growth in interest and the transactions are moving their way through the qualification design and so forth phases of the sales cycle to get to an actual sale. As I look at the sales funnel, obviously we're very well diversified in terms of the different segments that we're serving. The regional carriers, I would say, have been an increase in interest recently. And that's because the nature of the wind stream settlement fiber is a lot of regional markets and tier two, tier three reach and so forth as compared to our national long haul network that connects larger markets together. So overall, we've seen a lot of strong demand. And I'll actually just say we had our best month in bookings in April since 2019. So things are definitely trending up.

Thank you.

And our next question comes from David Barden with Bank of America.

Hey, guys. Thanks so much for taking the question. So I just, Kenny, I got to ask this question. You know, there's this slide nine. There's 186 opportunities out there. You know, the windstream bankruptcy was, you know, reemerged months ago. You know, once upon a time, this was never about being an organic execution story. It was about being an opco-propco, unique REIT with a unique, you know, private letter ruling from the IRS, an improved cost capital. You could help people do things they couldn't do on their own. Is that not the story anymore? Because I guess during the Windstream bankruptcy, I was, okay, I get it. They can't do deals because... the wind stream bankruptcy is going on. But now that it's been over for like nine months, nothing's really happening. And I'm wondering if the whole story is different and the focus on the execution and the fiber deployments and the customer base is really about trying to get some kind of fiber multiple, which other companies are trying to get as well. I'm just trying to understand what the story is today. And I guess the second question is, with respect to this, you know, Biden infrastructure bill, is this amazing news for you guys? Because you're in the exact spot where this money is trying to exploit, you know, the underpenetrated broadband opportunity? Or is it a terrible, you know, news? Because this money is going to go to the municipalities and cities in the markets where you operate with the express purpose of competing with you guys. Thanks. Sorry.

Hey, David. All good questions. Look, first of all, to your comment about not anything happening, I completely disagree with. So let me go back and I'll eventually build up to that. Our strategy from the beginning was to build an operating platform in addition to being acquisitive from an M&A front. So we wanted to have an operating platform where we could have day-to-day active interaction with the big wireless carriers, the data-centric providers, the MSOs, the national carriers, the real big consumers of broadband and fiber. and have an outlet to deploy capital organically to build a fiber network and operate a fiber network in addition to being an M&A roll-up play. And if you remember, our very first transaction back in 2016 was to buy an operating business. It was our first acquisition out of the gate. And for nine months after being spun out in 2015, we got the question, hey, what's going on? What's happening? And it took us a while to finally find the right first deal. And then after that, the floodgates were open. And the acquisitions that we did were a combination of platform companies that were combined with our operating business, as well as portfolios of assets. And some of those assets were structured to sell leasebacks, and some of them were just straight acquisitions of assets. So it was really an M&A roll-up being a combination of operating platforms and sale-leasebacks. And today, when you fast-forward to where we are, I think that strategy is working exactly as we designed it. We've got a really terrific operating platform that's putting capital to work, building new fiber, adding new long-term customers with locked-in, attractive economics, and we're leasing up leasing up that fiber very effectively but we also have an M&A platform that yes the M&A platform was somewhat on pause for a year year and a half but as I've said repeatedly we've been very active and as we've always been we're going to be very disciplined on the next opportunity so I like and respect the questions about hey when are you going to do another deal when are you going to do another deal because to me I take that as a compliment. That means people liked our old deals and the ones we've done in the past, and they want to see more, and I'm all for that. But one of the things that led to those good deals was we were disciplined and we were careful about doing the right ones, and that's what we're going to do. So we're active, and you're going to see more of those. On page nine, I think when you talk about these opportunities and the customers, it's important to point out Most of those customers and most of those opportunities, the vast majority of these are selling dark fiber or selling long-haul wholesale contracts. Those are basically just opco-propco relationships by another name. We're selling access to fiber. We're very passively managing that fiber. very light touch, very high margin, low capex, and that's essentially the same economics that are being driven from the types of deals that you're referencing, the Osco Propicos and the Sale Leasebacks. They're all very, very similar in nature. So locking in long-term customers, steady economics, very low churn, and so I think the customer base on page nine is highly consistent with that strategy. And, yes, we love the fiber multiple. That's exactly what we're aspiring to because we are a fiber company. And so I appreciate you pointing that out and lobbing that softball at me. We're actually very excited about the infrastructure bill. I think, first of all, it's another example of the sort of the bipartisan support for getting funding into the industry to help expand broadband. And so you look at the two competing bills, the Republican and the Democratic bill, there's a lot of disparity. But one area that's relatively consistent is they're both proposing substantial dollars for broadband deployment. And we think that deployment is not at all competitive to us. It's highly complementary. I mean, these are that are going to be spent at the edge of the networks, either deploying fiber to the home, in most cases probably fiber to the home, or other technologies like fixed wireless or otherwise that are eventually going to drive traffic onto our fiber network. So we're not going to be direct recipients of any of this federal money, but we will be a derivative beneficiary of it And we've seen that in past programs, whether it be CARES, the CARES funding, or the E-rate, you name it. These are dollars that get into the industry and they find their way to an infrastructure provider like us because the service providers are using that capital to build network and they're coming to us to build that network. Our sale leaseback customers, and of course I'm talking partially about Windstream, but I'm also talking about Some of the cable companies, the MSOs, the others who are accessing our network through sale leasebacks or dark fiber, they're substantial recipients of our DOF, for example. And we're having lots of conversations. Ron's had conversations with carriers about accessing our network all over the country, you know, deep into some of these rural areas as you would expect our network to go. I mean, we effectively... have ILEC fiber deep into these areas and so many of these RDOF recipients need fiber out onto the edge, metro rings, fiber into the COs and in some cases fiber even to the home and so we're seeing an uplift in customer discussions related to using that RDOF money to expand their networks and eventually going to be big beneficiaries of that. Look, we're big supporters of the infrastructure, the broadband deployment element of the infrastructure bill. There's some other parts of it that we're not big fans of, but we're big fans of that. All right.

Kenny, thank you so much. I don't get the softball moniker very often, but I appreciate it.

Thank you. We never consider your question softball otherwise, David.

And our last question comes from Simon Flannery with Morgan Stanley. You may begin.

Great. Thanks a lot. Good evening. Ron, one of the telcos yesterday was talking about delayed decision making in the enterprises and hoping that activity would pick up later in the year. I was just wondering what your conversations are like as the economy reopens. Are you seeing people more willing to make big decisions or has it really not been affected by the COVID lockdowns. And then just any updates on the wind stream disclosures, how their business went in Q1, and will we be getting any more disclosures during the course of this year or again with the 10K? Thank you.

Sure. Thank you. I'll take the first question and then defer the second one to Kenny. I'd say on the enterprise side, you know, when COVID first hit and the shutdowns happened, obviously we were affected by that. But then it rebounded quite significantly after things began to settle down a little bit. I'm sure there are companies out there that are still assessing their situation because different sectors are affected differently by what's happening with COVID and the shutdowns, right? But broadband is required by virtually everyone. And what I would say is that our enterprise business continues to grow at a very significant pace and is achieving its objectives for the year. And we feel very positive about that. So maybe we're less affected. I don't know. But our enterprise initiative seems to be on track to me. And I think it's just going to get stronger as the economy continues to recover. Kenny?

Great.

And Simon, on your wind stream results question, they're reporting, I think, in 10 days. So can't. get ahead of those results. We will be making some disclosure at that time, so more to come there. I will say, and this is a little bit related to David's question, but we are very, very encouraged and pleased by the industry overall with respect to residential broadband successes and especially among the traditional telecom space where fiber to the home is being deployed. So whether you're looking at the very large carriers down to some of the more regional ILECs, some public, some private, the successes on broadband ads, especially where fiber to the home deployments are being made. And even in the private markets where infrastructure capital and otherwise are spending big dollars to acquire fiber to the home platforms and to put money to work behind these business plans, we're very encouraged by that because it obviously suggests some success for Windstream and carriers like Windstream, but also, in our view at least, it validates our GCI program where we're really spending a lot of dollars to overbuild some of the copper portions of our network and to future proof those portions of our network with fiber and a lot of it being fiber to the home. But more to come on Windstream's results.

Great. I appreciate it. Thank you.

And we have no further questions at this time. I will now turn the call over to Kenny for closing remarks.

Okay, thank you. We appreciate your interest in Unity Group and look forward to updating you further on future calls. Thank you all for joining today. Thank you.

Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.