Anterix Inc. Q3 FY2025 earnings call

• Announced a $13.5 million expansion agreement with the Lower Colorado River Authority, extending broadband coverage to 93% of Texas counties. - Filed a five by five megahertz joint petition with the FCC, which led to a notice of proposed rulemaking moving the 900 megahertz band closer to a five by five offering. - Identified approximately 20% annual cost reductions in operational expenses. - Returned ~$4 million to shareholders through share repurchases in the third quarter. - Seven customers deploying 900 megahertz private LTE across 15 states, with the technology moving from lab to field. - Launched an industry engagement initiative to help utilities adopt private 900 megahertz broadband faster. - Initiated a strategic review process with Morgan Stanley to explore growth opportunities.

Tim Gray highlighted that due to strategic initiatives, Anterix delivered spectrum ahead of schedule, resulting in an incremental cash increase of $34 million. They have $150 million in uncollected contract proceeds, with $80 million expected to be received by fiscal 2026. Operational expenses were reduced by approximately 20% annually without compromising efficiency. Regarding share repurchases, ~$6.5 million has been returned to shareholders year to date in fiscal 2025, including $4.4 million in the third quarter.

• Anticipate receiving ~$80 million in uncollected contract proceeds by fiscal 2026. - Plan to continue share repurchases opportunistically based on cash flow and market conditions. - Expect continued cost reductions to enhance efficiency and cash flows. - The five by five expansion is seen as a significant opportunity for future growth and to enhance utility capabilities over the decades to come.

• Forward-looking statements involve risks and uncertainties that could cause actual results to differ from expectations. - Regulatory processes and timing for utilities to proceed with spectrum deployment are uncertain. - The success of the five by five initiative depends on regulatory approval and utility adoption, which are subject to various factors such as market conditions and stakeholder interests.

Q: What spurred external interest in the company?

A: Scott Lang stated external interest came from the company's market leadership, large ecosystem, $400 million in contracts, $150 million in uncollected proceeds, no debt, and strong pipeline.

Q: What's driving utilities to move quicker with the industry initiative?

A: Scott Lang mentioned utilities are seeing success with early adopters, there's a sense of urgency from executives, and efforts to make the process frictionless for utilities.

Q: Will existing customers get access to five by five automatically?

A: Scott Lang said existing customers would likely want access to five by five, but pricing for incremental access would be negotiated later.

Q: CapEx and value of five by five pipeline?

A: Tim Gray stated CapEx is expected to be in the $15-20 million range next year; Scott Lang mentioned the $400 million in signed contracts represents a large number of remaining population pops in the US, and five by five adds value to this pipeline.