Segment Information

6 Months Ended

Jun. 30, 2014

Segment Information [Abstract]

Segment Information

7.  Segment Information

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision makers.  The Company has three reportable segments, which the Company operates and manages as strategic business units organized by lines of business: (1) Wireless, (2) Cable, and (3) Wireline.   A fourth segment, Other, primarily includes Shenandoah Telecommunications Company, the parent holding company.

The Wireless segment provides digital wireless service to a portion of a four-state area covering the region from Harrisburg, York and Altoona, Pennsylvania, to Harrisonburg, Virginia, as a Sprint PCS Affiliate of Sprint.  This segment also owns cell site towers built on leased land, and leases space on these towers to both affiliates and non-affiliated service providers.

The Cable segment provides video, internet and voice services in Virginia, West Virginia and Maryland.  It does not include video, internet and voice services provided to customers in Shenandoah County, Virginia.

The Wireline segment provides regulated and unregulated voice services, DSL internet access, and long distance access services throughout Shenandoah County and portions of Rockingham, Frederick, Warren and Augusta counties, Virginia. The segment also provides video services in portions of Shenandoah County, and leases fiber optic facilities throughout the northern Shenandoah Valley of Virginia, northern Virginia and adjacent areas along the Interstate 81 corridor, through West Virginia and Maryland.

Three months ended June 30, 2014 (in thousands)	Wireless		Cable			Wireline		Other			Eliminations			Consolidated Totals
External revenues
Service revenues	$	47,868	$	17,416		$	5,120	$	-		$	-		$	70,404
Other		2,813		3,388			4,811		-			-			11,012
Total external revenues		50,681		20,804			9,931		-			-			81,416
Internal revenues		1,094		33			5,713		-			(6,840	)		-
Total operating revenues		51,775		20,837			15,644		-			(6,840	)		81,416
Operating expenses
Costs of goods and services, exclusive of depreciation and amortization shown separately below		18,476		12,421			7,737		-			(6,231	)		32,403
Selling, general and administrative, exclusive of depreciation and amortization shown separately below		7,657		4,735			1,493		3,349			(609	)		16,625
Depreciation and amortization		8,071		5,766			2,653		105			-			16,595
Total operating expenses		34,204		22,922			11,883		3,454			(6,840	)		65,623
Operating income (loss)		17,571		(2,085	)		3,761		(3,454	)		-			15,793

Three months ended June 30, 2013 (in thousands)	Wireless		Cable			Wireline		Other			Eliminations			Consolidated Totals
External revenues
Service revenues	$	46,362	$	16,325		$	5,558	$	-		$	-		$	68,245
Other		2,328		2,357			4,524		-			-			9,209
Total external revenues		48,690		18,682			10,082		-			-			77,454
Internal revenues		1,076		53			5,169		-			(6,298	)		-
Total operating revenues		49,766		18,735			15,251		-			(6,298	)		77,454
Operating expenses
Costs of goods and services, exclusive of depreciation and amortization shown separately below		17,854		11,239			7,198		-			(5,763	)		30,528
Selling, general and administrative, exclusive of depreciation and amortization shown separately below		8,068		4,500			1,251		3,071			(535	)		16,355
Depreciation and amortization		7,781		5,479			2,802		9			-			16,071
Total operating expenses		33,703		21,218			11,251		3,080			(6,298	)		62,954
Operating income (loss)		16,063		(2,483	)		4,000		(3,080	)		-			14,500

Six months ended June 30, 2014 (in thousands)	Wireless		Cable			Wireline		Other			Eliminations			Consolidated Totals
External revenues
Service revenues	$	95,100	$	34,840		$	10,220	$	-		$	-		$	140,160
Other		5,569		6,418			9,721		-			-			21,708
Total external revenues		100,669		41,258			19,941		-			-			161,868
Internal revenues		2,184		59			11,478		-			(13,721	)		-
Total operating revenues		102,853		41,317			31,419		-			(13,721	)		161,868
Operating expenses
Costs of goods and services, exclusive of depreciation and amortization shown separately below		37,132		24,811			15,219		-			(12,523	)		64,639
Selling, general and administrative, exclusive of depreciation and amortization shown separately below		16,089		9,381			2,737		6,764			(1,198	)		33,773
Depreciation and amortization		15,268		11,170			5,350		195			-			31,983
Total operating expenses		68,489		45,362			23,306		6,959			(13,721	)		130,395
Operating income (loss)		34,364		(4,045	)		8,113		(6,959	)		-			31,473
Six months ended June 30, 2013 (in thousands)	Wireless		Cable			Wireline		Other			Eliminations			Consolidated Totals
External revenues
Service revenues	$	90,427	$	32,487		$	11,021	$	-		$	-		$	133,935
Other		5,347		4,659			9,522		-			-			19,528
Total external revenues		95,774		37,146			20,543		-			-			153,463
Internal revenues		2,149		102			9,808		-			(12,059	)		-
Total operating revenues		97,923		37,248			30,351		-			(12,059	)		153,463
Operating expenses
Costs of goods and services, exclusive of depreciation and amortization shown separately below		35,385		22,461			14,364		-			(10,981	)		61,229
Selling, general and administrative, exclusive of depreciation and amortization shown separately below		15,955		8,924			2,612		6,071			(1,078	)		32,484
Depreciation and amortization		13,809		10,684			5,532		17			-			30,042
Total operating expenses		65,149		42,069			22,508		6,088			(12,059	)		123,755
Operating income (loss)		32,774		(4,821	)		7,843		(6,088	)		-			29,708

A reconciliation of the total of the reportable segments’ operating income to consolidated income before taxes is as follows:

	Three Months Ended June 30,
	2014			2013
Total consolidated operating income	$	15,793		$	14,500
Interest expense		(2,065	)		(2,068	)
Non-operating income (expense), net		573			488
Income before taxes	$	14,301		$	12,920

	Six Months Ended June 30,
	2014			2013
Total consolidated operating income	$	31,473		$	29,708
Interest expense		(4,112	)		(4,220	)
Non-operating income (expense), net		1,182			1,157
Income before taxes	$	28,543		$	26,645

The Company’s assets by segment are as follows:

(in thousands)	June 30, 2014			December 31, 2013
Wireless	$	233,637		$	229,038
Cable		208,092			199,184
Wireline		89,487			92,455
Other		417,790			435,804
Combined totals		949,006			956,481
Inter-segment eliminations		(345,003	)		(359,475	)
Consolidated totals	$	604,003		$	597,006