Its name may sound like a Division II college, but Hickory Tech's field of play is telecommunications. The company operates two business segments: Telecom and Enventis (Internet protocol-based voice and data services). Through its subsidiaries, the company provides 55,000 residential and business customers with access lines in Iowa and Minnesota. It also offers long-distance services to 36,000 customers, broadband Internet access services to 19,000 customers, and digital television service to about 10,000 customers. Its National Independent Billing unit, which is part of the Telecom segment, provides data processing services to other telecommunications companies.
About half of Hickory Tech's sales come from Enventis, a regional provider of Internet protocol (IP) transport and enterprise communications services, has more than 300 business customers. It is a Gold Certified Partner of Cisco Systems.
Unfavorable economic conditions contributed to Hickory Tech's revenues falling by about 9% in 2009. Still, the company posted its biggest profit in six years. A reduction of accrued income taxes, which related to the expiration of a statute of limitations, added $4.5 million to net income in 2009.
To return to growth in 2010 and future years, Hickory Tech outlines several strategic tipping points. The company will continue to leverage its Hickory Tech brand, offsetting the decline in telecom network access and local services (marking the widespread decline in landline customers) by offering such value-added services as higher-speed Internet access and local content. Hickory Tech also will develop and deploy advanced communications technologies, grow monthly recurring revenue services through business-to-business sales, maintain stable cash flows from operations and disciplined capital spending, and grow through select strategic initiatives (including acquisitions).
Carrying out part of those plans, Hickory Tech bought Fargo, North Dakota-based metro fiber network provider IdeaOne Telecom in a deal valued at about $28 million. In 2010 Hickory Tech had extended its fiber network to Fargo, and this purchase will give the company access to 3,600 customers in that market that are about evenly split between business and residential. Hickory Tech is continuing a broadband stimulus route build-out to Fargo from Brainerd, Minnesota that will further improve the company's ability to serve Fargo customers.
In 2009 Hickory Tech acquired Computer Pro Inc., dba CP Telecom, for $6.6 million. CP Telecom is a facilities-based telecom services provider in the Twin Cities and northern Minnesota. It became part of the Enventis organization.
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