Centennial Communications Announces Fiscal Third-Quarter Results

WALL, NJ, Apr 07 (MARKET WIRE) --
Centennial Communications Corp. (NASDAQ: CYCL) ("Centennial") today
reported net income of $19.4 million, or $0.18 per diluted share, for the
fiscal third quarter of 2009 as compared to net income of $5.4 million,
or $0.05 per diluted share, in the fiscal third quarter of 2008.
Consolidated adjusted operating income (AOI)(1) was $106.3 million for
the fiscal third quarter, as compared to $93.5 million for the adjusted
prior-year quarter. For comparison, certain of the Company's fiscal 2008
financial results have been adjusted to reflect the discontinuation of
its loaned phones program in Puerto Rico as of June 1, 2008(2).

Centennial reported fiscal third-quarter consolidated revenue of $262.7
million, which included $147.1 million from U.S. wireless and $115.6
million from Puerto Rico operations. Consolidated revenue grew 5 percent
versus the fiscal third quarter of 2008. The Company ended the quarter
with 1,094,900 total wireless subscribers, which compares to 1,086,300 for
the year-ago quarter and 1,091,600 for the previous quarter ended November
30, 2008. The Company reported 683,300 total access lines and equivalents
at the end of the fiscal third quarter, which compares to 559,200 for the
year-ago quarter.

AT&T TRANSACTION

-- On February 24, 2009, Centennial announced that its stockholders
approved the adoption of the Agreement and Plan of Merger, dated as of
November 7, 2008 (the "Merger Agreement"), providing for the acquisition of
Centennial by AT&T Inc. ("AT&T"). Of the shares voted at the special
meeting, over 99 percent were cast in favor of the adoption, representing
approximately 88 percent of the total shares outstanding and entitled to
vote.

-- On November 7, 2008, Centennial entered into the Merger Agreement
under which AT&T will acquire Centennial (the "Merger"). Under the terms
of the Merger Agreement, Centennial stockholders will receive $8.50 per
share in cash for a total equity price of $944 million. Including net
debt, the total enterprise value is approximately $2.8 billion. Completion
of the Merger is not subject to a financing condition, but remains subject
to (i) conditions relating to approval by the Federal Communications
Commission, (ii) expiration or termination of applicable waiting periods
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and (iii) other customary conditions to closing. The Company anticipates
that the Merger will be completed by mid-year calendar 2009, assuming
satisfaction or waiver of all of the conditions to the Merger.

CENTENNIAL SEGMENT HIGHLIGHTS

U.S. Wireless Operations

-- Revenue was $147.1 million, a 7 percent increase from last year's
third quarter. Retail revenue (total revenue excluding roaming revenue)
increased 7 percent from the year-ago period primarily driven by solid
data, access and feature revenue. Roaming revenue increased 3 percent from
the year-ago quarter primarily because of an increase in data roaming
revenue, partially offset by a decline in voice roaming revenue due to a 16
percent decrease in the average roaming rate per minute.

-- Average revenue per user (ARPU) was $74 during the fiscal third
quarter, a 6 percent year-over-year increase. ARPU included approximately
$8.12 of data revenue per user, which grew 49 percent from the year-ago
period.

-- AOI was $59.3 million, a 17 percent year-over-year increase,
representing an AOI margin of 40 percent. AOI benefited from solid growth
in retail revenue and a decrease in advertising expenses.

-- U.S. wireless ended the quarter with 664,200 total subscribers, which
compares to 662,700 for the prior-year quarter and to 661,100 for the
previous quarter ended November 30, 2008. Postpaid subscribers increased
4,800 from the fiscal second quarter of 2009 on stable postpaid churn of
2.1 percent.

-- Capital expenditures were $12.3 million for the fiscal third quarter.

Puerto Rico Wireless Operations

-- Revenue was $83.5 million, an increase of 1 percent from the prior-
year third quarter, primarily driven by a 2 percent increase in total
subscribers and growth in data roaming revenue.

-- ARPU was $65, which was unchanged compared to the year-ago period.
ARPU included approximately $10.43 of data revenue per user, which
increased 48 percent from the year-ago period.

-- AOI totaled $27.1 million, an adjusted 7 percent year-over-year
increase, representing an AOI margin of 32 percent. AOI benefited from an
increase in total subscribers and an adjusted 5 percent decrease in handset
expense.

-- Puerto Rico wireless ended the quarter with 430,700 total subscribers,
which compares to 423,600 for the prior-year quarter and to 430,500 for the
previous quarter ended November 30, 2008. Postpaid subscribers increased
400 from the fiscal second quarter of 2009 due to an increase in Instant
Internet broadband data customers, largely offset by continued declines in
traditional voice customers. Postpaid churn rose to 2.9 percent.

-- Capital expenditures were $5.7 million for the fiscal third quarter.

Puerto Rico Broadband Operations

-- Revenue was $35.0 million, a 3 percent year-over-year increase.
Revenue increased primarily due to solid access line growth, partially
offset by a decrease in recurring revenue per line.

-- AOI was $19.9 million, a 13 percent increase from the year-ago period,
representing an AOI margin of 57 percent. AOI increased largely due to
solid access line growth and a settlement related to an intercarrier
compensation dispute.

-- Switched access lines totaled approximately 103,700 at the end of the
fiscal third quarter, an increase of 12,100 lines, or 13 percent from the
prior-year quarter. Dedicated access line equivalents were 579,600 at the
end of the fiscal third quarter, a 24 percent year-over-year increase.

-- Capital expenditures were $6.1 million for the fiscal third quarter.

REVISED FISCAL 2009 OUTLOOK

-- The Company expects consolidated AOI from continuing operations between
$400 million and $415 million for fiscal 2009, excluding stock-based
compensation expense. Consolidated AOI from continuing operations for
fiscal year 2008 would have been $385.7 million if adjusted for the
discontinuation of the loaned phones program in the Company's Puerto
Rico wireless operations. The Company has not included a reconciliation
of projected AOI to the related GAAP measure because projections for
some components of this reconciliation are not possible to forecast
at this time.

-- The Company expects fiscal 2009 U.S. wireless roaming revenue to be
approximately flat versus fiscal 2008. U.S. wireless roaming revenue
for fiscal 2008 was $58.3 million.

-- The Company expects capital expenditures will be approximately $125
million for fiscal 2009 including spectrum clearing to partially upgrade
its U.S. wireless network to next-generation (3G) technology. Capital
expenditures including spectrum acquisition costs for fiscal 2008 would
have been $118.7 million if adjusted for the discontinuation of the
loaned phones program in the Company's Puerto Rico wireless operations.

FY2008 Adjusted FY2009 Previous FY2009 Revised
Results Outlook Outlook
--------------- --------------- --------------
Consolidated Adjusted $385.7 million $395 million - $400 million -
Operating Income (adjusted for $415 million $415 million
(AOI) $18.4 million
of capitalized
phones)
U.S. Wireless Roaming Approximately Approximately
Revenue $58.3 million $5 million flat versus
decline fiscal 2008
Consolidated Capital
Expenditures (Capex) $118.7 million $130 million $125 million
(adjusted for including partial including
$18.4 million next-generation (3G) spectrum
of capitalized network upgrade in clearing for
phones) U.S. wireless partial next-
generation
(3G) network
upgrade in U.S.
wireless

DEFINITIONS AND RECONCILIATION

(1) Adjusted operating income is defined as net income before loss from
discontinued operations, minority interest in income of subsidiaries,
income tax expense, interest expense, net, loss on disposition of
assets, litigation settlement expense, transaction costs, stock-based
compensation expense and depreciation and amortization. Please refer
to the schedule below for a reconciliation of adjusted operating income
to consolidated net income and the Investor Relations website at
www.ir.centennialwireless.com for a discussion and reconciliation of
this and other non-GAAP financial measures.

Reconciliation of adjusted operating income to consolidated net income:

Three Months Ended Nine Months Ended
February 28, February 29, February 28, February 29,
----------- ----------- ----------- -----------
2009 2008 2009 2008
----------- ----------- ----------- -----------
Adjusted operating
income $ 106,315 $ 99,108 $ 299,581 $ 295,128
Depreciation and
amortization (32,366) (35,262) (103,019) (102,873)
Stock-based
compensation expense (2,815) (2,112) (9,019) (8,548)
Transaction costs (666) -- (3,002) --
Litigation settlement
expense -- -- -- (2,950)
Loss on disposition of
assets (422) (120) (456) (1,731)
----------- ----------- ----------- -----------
Operating income 70,046 61,614 184,085 179,026
Interest expense, net (42,735) (47,508) (132,163) (143,901)
Income tax expense (7,508) (7,302) (20,255) (20,270)
Minority interest in
income of subsidiaries (284) (171) (581) (492)
----------- ----------- ----------- -----------
Income from continuing
operations 19,519 6,633 31,086 14,363
Net loss from
discontinued
operations (138) (1,218) (926) (2,257)
=========== =========== =========== ===========
Net income $ 19,381 $ 5,415 $ 30,160 $ 12,106
=========== =========== =========== ===========

(2) Please refer to the Company's Form 10-K for the year ending
May 31, 2008 and the fiscal fourth-quarter 2008 earnings press release
for information regarding the discontinuation of the loaned phones
program.

ABOUT CENTENNIAL

Centennial Communications (NASDAQ: CYCL), based in Wall, NJ, is a leading
provider of regional wireless and integrated communications services in
the United States and Puerto Rico with approximately 1.1 million wireless
subscribers and 683,300 access lines and equivalents. The U.S. business
owns and operates wireless networks in the Midwest and Southeast covering
parts of six states. Centennial's Puerto Rico business owns and operates
wireless networks in Puerto Rico and the U.S. Virgin Islands and provides
facilities-based integrated voice, data and Internet solutions. Welsh,
Carson, Anderson & Stowe is a significant shareholder of Centennial. For
more information regarding Centennial, please visit our websites
http://www.centennialwireless.com/ and http://www.centennialpr.com/.

SAFE HARBOR PROVISION

Cautionary statement for purposes of the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995: Information in this
release that involves Centennial's expectations, beliefs, hopes, plans,
projections, estimates, intentions or strategies regarding the future are
forward-looking statements. Such forward-looking statements are subject to
a number of risks, assumptions and uncertainties that could cause the
Company's actual results to differ materially from those projected in such
forward-looking statements. These risks, assumptions and uncertainties
include, but are not limited to: the occurrence of any event, change or
other circumstance that could give rise to the termination of the Merger
Agreement with AT&T; the outcome of any legal proceeding that has been or
may be instituted against Centennial and others relating to the Merger
Agreement with AT&T; the inability to complete the Merger due to the
failure to satisfy r conditions to consummation of the Merger; the failure
of the Merger to close for any other reason; risks that the proposed
transaction disrupts current plans and operations and the potential
difficulties in employee retention as a result of the Merger; business
uncertainty and contractual restrictions during the pendency of the
Merger; the diversion of management's attention from ongoing business
concerns; the effect of the announcement of the Merger on our customer
and supplier relationships, operating results and business generally; the
amount of the costs, fees, expenses and charges related to the Merger;
the timing of the completion of the Merger or the impact of the Merger on
our capital resources, cash requirements, profitability, management
resources and liquidity; risks and uncertainties relating to our business
(including our ability to achieve strategic goals, objectives and targets
over applicable periods), industry performance and the regulatory
environment; the effects of a recession in the United States and general
downturn in the economy, including the illiquidity in the debt/capital
markets; the effects of vigorous competition in our markets, which may
make it difficult for us to attract and retain customers and to grow our
customer base and revenue and which may increase churn, which could
reduce our revenue and increase our costs; the fact that many of our
competitors are larger than we are, have greater financial resources than
we do, are less leveraged than we are, have more extensive coverage areas
than we do, and may offer less expensive and more technologically
advanced products and services than we do; our ability to gain access to
the latest technology handsets in a timeframe and at a cost similar to
our competitors; our ability to acquire, and the cost of acquiring,
additional spectrum in our markets to support growth and deployment of
advanced technologies, including 3G and 4G services; our ability to
successfully deploy and deliver wireless data services to our customers,
including next generation 3G and 4G technology; the effect of changes in
the level of support provided to us by the Universal Service Fund, or
USF; our ability to grow our subscriber base at a reasonable cost to
acquire; our dependence on roaming agreements for a significant portion
of our wireless revenue and the expected decline in roaming revenue over
the long term; our ability to successfully integrate any acquired markets
or businesses; the effects of higher than anticipated handset subsidy
costs; our dependence on roaming agreements for our ability to offer our
wireless customers competitively priced regional and nationwide rate plans
that include areas for which we do not own wireless licenses; the effects
of adding new subscribers with lower credit ratings; our substantial debt
obligations, including restrictive covenants, which place limitations on
how we conduct business; market prices for the products and services we
offer may decline in the future; changes and developments in technology,
including our ability to upgrade our networks to remain competitive and
our ability to anticipate and react to frequent and significant
technological changes which may render certain technologies used by us
obsolete; the effects of a decline in the market for our Code Division
Multiple Access ("CDMA")-based technology; the effects of consolidation
in the telecommunications industry; general economic, business, political
and social conditions in the areas in which we operate, including the
effects of downturns in the economy, world events, terrorism, hurricanes,
tornadoes, wind storms and other natural disasters; our ability to
generate cash and the availability and cost of additional capital to fund
our operations and our significant planned capital expenditures; our need
to refinance or amend existing indebtedness prior to its stated maturity;
the effects of governmental regulation of the telecommunications
industry; our ability to attract and retain qualified personnel; the
effects of network disruptions and system failures; our ability to
manage, implement and monitor billing and operational support systems;
the results of litigation filed or which may be filed against us or our
vendors, including litigation relating to wireless billing, using
wireless telephones while operating an automobile and litigation relating
to infringement of patents; the effects of scientific reports that may
demonstrate possible health effects of radio frequency transmission from
use of wireless telephones; the influence on us by our significant
stockholder and anti-takeover provisions and other risks referenced from
time to time in the Company's filings with the Securities and Exchange
Commission. All forward-looking statements included in this release are
based upon information available to Centennial as of the date of the
release, and we assume no obligation to update or revise any such
forward-looking statements.

CENTENNIAL COMMUNICATIONS CORP.
FINANCIAL DATA AND OPERATING STATISTICS
02/28/2009
($000's, except per subscriber data)

Three Months Ended Nine Months Ended
---------------------- ----------------------
Feb-09 Feb-08 Feb-09 Feb-08
---------- ---------- ---------- ----------

CONSOLIDATED
Total Wireless Subscribers 1,094,900 1,086,300 1,094,900 1,086,300
Net Gain - Total Subscribers 3,300 18,000 2,300 36,700
Revenue per Average
Wireless Customer (1) $ 70 $ 68 $ 71 $ 68
Retail Penetration (4) 8.4% 8.4% 8.4% 8.4%
Prepaid & Postpaid Churn -
Wireless (5) 2.5% 2.3% 2.6% 2.4%
Monthly MOU's per Wireless
Voice Customer 1,378 1,373 1,402 1,353

U.S. WIRELESS

Postpaid Wireless
Subscribers 649,500 641,000 649,500 641,000
Prepaid Wireless
Subscribers 14,700 21,700 14,700 21,700
---------- ---------- ---------- ----------
Total Wireless Subscribers 664,200 662,700 664,200 662,700
Total Wireless Gross Adds 47,200 58,200 147,800 154,800
Net Gain - Wireless
Subscribers 3,100 12,600 (1,100) 19,600
GSM as a % of Retail
Subscribers 100.0% 97.1% 100.0% 97.1%
Revenue per Average
Wireless Customer (1) $ 74 $ 70 $ 74 $ 70
Retail Revenue per Average
Wireless Customer (2) $ 67 $ 64 $ 66 $ 62
Data Revenue per Average
Wireless Customer (3) $ 8.12 $ 5.45 $ 7.40 $ 4.81
Retail Revenue $ 134,191 $ 125,276 $ 395,264 $ 363,502
Roaming Revenue $ 12,899 $ 12,526 $ 43,845 $ 44,711
Penetration - Wireless (4) 7.4% 7.4% 7.4% 7.4%
Postpaid Churn -
Wireless (5) 2.1% 2.0% 2.4% 2.0%
Prepaid & Postpaid Churn -
Wireless (5) 2.2% 2.3% 2.5% 2.3%
Monthly MOU's per Wireless
Voice Customer 1,090 1,075 1,105 1,058
Cost to Acquire (6) $ 311 $ 288 $ 334 $ 353
Capital Expenditures $ 12,279 $ 16,156 $ 29,376 $ 34,974

PUERTO RICO

Postpaid Wireless
Subscribers 427,000 420,900 427,000 420,900
Prepaid Wireless
Subscribers 3,700 2,700 3,700 2,700
---------- ---------- ---------- ----------
Total Wireless Subscribers 430,700 423,600 430,700 423,600
Total Wireless Gross Adds 38,000 35,400 110,200 108,300
Net Gain - Wireless
Subscribers 200 5,400 3,400 17,100
Revenue per Average
Wireless Customer (1) $ 65 $ 65 $ 66 $ 66
Data Revenue per Average
Wireless Customer (3) $ 10.43 $ 7.06 $ 9.43 $ 6.53
Penetration - Wireless (4) 10.8% 10.6% 10.8% 10.6%
Postpaid Churn -
Wireless (5) 2.9% 2.4% 2.7% 2.4%
Prepaid & Postpaid Churn -
Wireless (5) 2.9% 2.4% 2.8% 2.5%
Monthly MOU's per Wireless
Voice Customer 1,875 1,864 1,905 1,839
Fiber Route Miles 1,393 1,333 1,393 1,333
Switched Access Lines 103,700 91,600 103,700 91,600
Dedicated Access Line
Equivalents (7) 579,600 467,600 579,600 467,600
On-Net Buildings 2,442 2,146 2,442 2,146
Capital Expenditures -
Wireless $ 5,677 $ 10,264 $ 24,233 $ 27,022
Capital Expenditures -
Broadband $ 6,102 $ 3,753 $ 20,704 $ 13,599
---------- ---------- ---------- ----------
Capital Expenditures -
Total Puerto Rico $ 11,779 $ 14,017 $ 44,937 $ 40,621
========== ========== ========== ==========

REVENUES

U.S. Wireless $ 147,090 $ 137,802 $ 439,109 $ 408,213
---------- ---------- ---------- ----------
Puerto Rico - Wireless $ 83,497 $ 82,681 $ 253,726 $ 244,818
Puerto Rico - Broadband $ 35,023 $ 33,919 $ 105,880 $ 98,929
Puerto Rico - Intercompany $ (2,881) $ (3,249) $ (8,881) $ (9,269)
---------- ---------- ---------- ----------
Total Puerto Rico $ 115,639 $ 113,351 $ 350,725 $ 334,478
---------- ---------- ---------- ----------
Consolidated $ 262,729 $ 251,153 $ 789,834 $ 742,691
========== ========== ========== ==========

ADJUSTED OPERATING INCOME (8)

U.S. Wireless $ 59,323 $ 50,497 $ 168,216 $ 155,008
---------- ---------- ---------- ----------
Puerto Rico - Wireless $ 27,112 $ 30,958 $ 73,576 $ 86,846
Puerto Rico - Broadband $ 19,880 $ 17,653 $ 57,789 $ 53,274
---------- ---------- ---------- ----------
Total Puerto Rico $ 46,992 $ 48,611 $ 131,365 $ 140,120
---------- ---------- ---------- ----------
Consolidated $ 106,315 $ 99,108 $ 299,581 $ 295,128
========== ========== ========== ==========

NET DEBT

Total Debt Less Cash and
Cash Equivalents $1,858,700 $1,924,100 $1,858,700 $1,924,100

(1) Revenue per Average Wireless Customer is determined for each period by
dividing total monthly revenue per wireless subscriber including
roaming revenue by the average customers for such period.
(2) Retail Revenue per Average Wireless Customer is determined for each
period by dividing retail revenue (total revenue excluding roaming
revenue) by the average customers for such period.
(3) Data Revenue per Average Wireless Customer is determined for each
period by dividing data revenue by the average customers for such
period.
(4) The penetration rate equals the percentage of total population in our
service areas who are subscribers to our wireless service as of
period-end.
(5) Churn is calculated by dividing the aggregate number of subscribers
who cancel service during each month in a period by the total number
of subscribers as of the beginning of the month. Churn is stated as
the average monthly churn rate for the period.
(6) Cost to Acquire a new customer is calculated by dividing the sum of
the cost of phones and marketing expenses less the related
equipment sales by the gross activations for the period. Cost to
acquire excludes costs relating to phones used for customer
retention.
(7) February 2008 includes 84,700 dedicated access line equivalents
related to repeatedly renewed short term contracts that had previously
been excluded due to their term.
(8) Adjusted operating income is defined as net income before loss from
discontinued operations, minority interest in income of subsidiaries,
income tax expense, interest expense, net, loss on disposition of
assets, litigation settlement expense, transaction costs, stock-based
compensation expense and depreciation and amortization.

CENTENNIAL COMMUNICATIONS CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)

Three Months Ended Nine Months Ended
------------------------ ------------------------
February 28, February 29, February 28, February 29,
2009 2008 2009 2008
----------- ----------- ----------- -----------

REVENUE:
Service revenue $ 247,415 $ 233,361 $ 743,669 $ 698,457
Equipment sales 15,314 17,792 46,165 44,234
----------- ----------- ----------- -----------
262,729 251,153 789,834 742,691
----------- ----------- ----------- -----------

COSTS AND EXPENSES:
Cost of services
(exclusive of
depreciation and
amortization shown
below) 46,383 45,034 148,300 135,975
Cost of equipment sold 37,737 34,047 120,729 95,831
Sales and marketing 24,180 25,503 78,698 77,817
General and
administrative 51,595 49,573 154,547 149,438
Depreciation and
amortization 32,366 35,262 103,019 102,873
Loss on disposition of
assets 422 120 456 1,731
----------- ----------- ----------- -----------
192,683 189,539 605,749 563,665
----------- ----------- ----------- -----------

OPERATING INCOME 70,046 61,614 184,085 179,026
----------- ----------- ----------- -----------

INTEREST EXPENSE, NET (42,735) (47,508) (132,163) (143,901)
----------- ----------- ----------- -----------

INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME
TAX EXPENSE AND MINORITY
INTEREST IN INCOME OF
SUBSIDIARIES 27,311 14,106 51,922 35,125

INCOME TAX EXPENSE (7,508) (7,302) (20,255) (20,270)
----------- ----------- ----------- -----------

INCOME FROM CONTINUING
OPERATIONS BEFORE
MINORITY INTEREST IN
INCOME OF SUBSIDIARIES 19,803 6,804 31,667 14,855

MINORITY INTEREST IN
INCOME OF SUBSIDIARIES (284) (171) (581) (492)
----------- ----------- ----------- -----------

INCOME FROM CONTINUING
OPERATIONS 19,519 6,633 31,086 14,363

NET LOSS FROM
DISCONTINUED
OPERATIONS (138) (1,218) (926) (2,257)
----------- ----------- ----------- -----------

NET INCOME $ 19,381 $ 5,415 $ 30,160 $ 12,106
=========== =========== =========== ===========

EARNINGS (LOSS) PER
SHARE:
BASIC
EARNINGS PER SHARE
FROM CONTINUING
OPERATIONS $ 0.18 $ 0.06 $ 0.29 $ 0.13
LOSS PER SHARE
FROM DISCONTINUED
OPERATIONS $ (0.00) $ (0.01) $ (0.01) $ (0.02)
----------- ----------- ----------- -----------
NET INCOME PER
SHARE $ 0.18 $ 0.05 $ 0.28 $ 0.11
=========== =========== =========== ===========

DILUTED
EARNINGS PER SHARE
FROM CONTINUING
OPERATIONS $ 0.18 $ 0.06 $ 0.28 $ 0.13
LOSS PER SHARE
FROM DISCONTINUED
OPERATIONS $ (0.00) $ (0.01) $ (0.01) $ (0.02)
----------- ----------- ----------- -----------
NET INCOME PER
SHARE $ 0.18 $ 0.05 $ 0.27 $ 0.11
=========== =========== =========== ===========

WEIGHTED-AVERAGE SHARES
OUTSTANDING DURING THE
PERIOD:
BASIC 109,318 107,755 108,550 107,457
=========== =========== =========== ===========
DILUTED 110,992 109,987 110,360 110,240
=========== =========== =========== ===========

For investor and media inquiries please contact:
Steve E. Kunszabo
Executive Director, Investor Relations
732-556-2220

Copyright 2009, Market Wire, All rights reserved.

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