Good morning everyone, and welcome to the Shenandoah Telecommunications Fourth Quarter of 2010 Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Ms. Adele Skolits, CFO. Please go ahead ma’am.

Good morning and thank you for joining us. The purpose of today’s call is to review Shentel’s results for the quarter ended December 31, 2010. Our results were announced in a press release distributed this morning and the presentation we’ll be reviewing is included on our website at www.shentel.com. Please note that a replay of this call will be made available later today. The details were set forth in the press release announcing this call. With us on the call today are Christopher French, our President and Chief Executive Officer; and Earle MacKenzie, our Executive Vice President and Chief Operating Officer. After our prepared remarks, we’ll conduct a question-and-answer session. I’ll begin with slide two of the presentation. While we don’t provide guidance with respect to specific future financial results, we caution that this call may contain forward-looking statements, which involve a number of known and unknown risks and uncertainties. These may cause our actual results to differ materially from these statements. Shentel provides a detailed discussion of various risk factors in our SEC filings, which you are strongly encouraged to review. You’re cautioned not to place undue reliance on these forward-looking statements. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements. Also, in an effort to provide useful information to investors, we note on slide three that our comments today include non-GAAP financial measures. Details on these measures, including why we use them and reconciliations to the most comparable GAAP measures, are included in our SEC filings. I’ll turn the call over to Chris now.

Thank you, Adele. We appreciate everyone joining us this morning. We had a great fourth quarter both in terms of customer growth and progress with expansion of our cable and wireless businesses. On slide 5 we list some of the highlights in these areas. As of the end of the year, total postpaid and prepaid wireless customers exceeded 300,000. Total cable segment revenue generating units or RGUs surpassed 100,000 at year’s end. At the end of November, we closed on the announced purchase of two markets from Suddenlink, passing approximately 7000 homes and including 3900 RGUs. In our wireless segment, we continued to have great success in our prepaid business, which grew by 10,775 net ads in the fourth quarter, and 17,071 since we began offering Virgin Mobile and Boost prepaid wireless services in July. Earle will be reviewing our operating results in greater detail later on this call. Highlights of the accomplishments in our cable segment are shown on slide six. Upgrades of all systems purchased from Rapid Communication in December 2008 are now complete. We are making progress on the upgrade’s needs in the cable markets acquired from JetBroadband last July 30. We have completed the work needed on two thirds of the total mileage of outside plan, and will finish the first system upgrade in the first quarter. As of the end of 2010, we were able to offer high-speed data to 89%, and voice to 73% of our acquired video homes passed, helping us to add 9972 RGUs in 2010. Wireless segment highlights are shown on slide seven. On top of the customer base we acquired from Sprint Nextel, prepaid customers grew by 17,071 in 2010. Postpaid wireless PCS customers are up 6% from the year ago. Continued postpaid growth was helped by churn of just…

Thank you, Chris. I’ll begin on Slide 10. Adjusted operating income before depreciation and amortization, or OIBDA for 2010 was $82.6 million or up $6.6 million from 2009. In order to better understand the forces driving this change, I’ve provided the OIBDA results by segment on slide 11. Here you get a picture of the segment’s results and how they are contributing to the consolidated financial results. In a moment, I will go into the wireless and cable OIBDA changes in depth. What you see from this table however is that the adjusted wireless OIBDA has grown despite the significant incremental costs associated with acquiring prepaid customers. Increases in telephone rates and access fees drove a 2 million increase in wireline results. Cable results have improved as a result of the acquisition of JetBroadband. However, the impact of the incremental OIBDA from the JetBroadband business is being offset by the significant incremental cost of acquiring new customers in the cable business as we will see in a moment. On slide 12, I have analyzed the changes in the wireless OIBDA results between 2009 and 2010. As Earle will discuss, postpaid revenues grew by $5.9 million as a result of the growth in its customer base. The prepaid business has already begun to make a meaningful contribution with 5.6 million in new revenue related to prepaid customers. As you may recall, the service fee charged by Sprint-Nextel in the postpaid business rose from 8.8% to 12% effective June 1st, 2010. This change increased service fees by $2.4 million in 2010. Acquiring prepaid customers involves additional expenses related to handset subsidies, commissions, marketing, and other sales related costs. As a result of our success in acquiring prepaid customers, there were $4.9 million of incremental acquisition costs in 2010. We also paid separate…

Thank you, Adele. Customers’ growth in our wireless segment in 2010 continued to be strong. Slide 15 shows the postpaid growth over the past several years, with our postpaid customers growing 5.8% in 2010 to 235,697. Slide 16 shows the details behind the postpaid growth. We added 5112 net postpaid customers in the fourth quarter of 2010 compared to 3,465 in the same quarter last year. Our fourth quarter churn was at 1.8%, down from 2% in the fourth quarter of 2009. The annual churn reduction from 2.1% to 1.9% was the key factor in higher net postpaid adds in 2010. So as the number of 2011 gross additions were only up slightly over 2009. Postpaid gross billed revenue is shown on slide 17. Fourth-quarter gross billed revenue was $55.49, the same as the third quarter and reverses the recent trend of its declining ARPU. This is being influenced by increased data usage and the $10 data fee for smart phones. Data ARPU for the fourth quarter was $22.61, almost a 15% increase over the same quarter last year, and up $1.03 or 4.8% from the third quarter of 2010. The reconciliation of our gross billed revenue to the net service revenue is shown on slide 18. Gross billed revenue has increased approximately 4% between 2009 and 2010 to $151 million. The amount of bad debt has decreased 17%, and the service credits although up in absolute dollars have declined slightly as a percentage of revenue. The major change is the increase in the net service fee percentage in June 2010 from 8.8% to 12%, the maximum allowed by our current contract. The impact of the change in the net service fee percentage for the last seven months of 2010 is 2.4 million, resulting in a net increase in the…

This concludes our prepared remarks. Karen, would you now review the instructions for posing a question.

(Operator instructions) We will go first with Ric Prentiss of Raymond James. Charlie Kesio – Raymond James: Hi, this is Charlie Kesio [ph] sitting in for Ric.

Good morning Charlie. Charlie Kesio – Raymond James: Hi. I guess, my first question would be on I mean you guys are doing really well in terms of getting prepaid ramp up. I was just curious if you could kind of go over really what is the competition that you guys face on the prepaid side?

Charlie, this is Earle. We do not have leap or Metro PCS in our area. So our competition is primarily the prepaid that are sold by the other major wireless carriers. Obviously, we have the same distribution that the others are having with the big box stores selling. There are also a number of small retailers that sell our product and other project, but we have now rolled out the Boost and Virgin Mobile product in all of our company stores. We have added it to the distribution channels that we control in the area, and also have picked up the hundreds of third-party distribution that Sprint already had in place. Charlie Kesio – Raymond James: And then, if you can just kind of go through the detail in terms of the 900,000 favorable tower revenue that you guys mentioned, I just wanted to make sure I heard that correct, was that in 4Q and did that flow down to EBITDA?

It wasn’t 4Q, it was other income Charlie, and it did flow down to OIBDA. Charlie Kesio – Raymond James: Okay, great.

In addition to that we had $1 million of other just general increases in revenues from the towers. Charlie Kesio – Raymond James: Okay, and final question, just if you can let me know when you think the Q will be filed.

That would be tomorrow morning. Charlie Kesio – Raymond James: Okay. Great. I appreciate it guys.

Sure.

Thank you Charlie.

Thank you, and our next question comes from the line of Greg Burns from Sidoti & Co. Greg Burns – Sidoti & Co.: Good morning. Thanks for taking the question.

Good morning Greg. Greg Burns – Sidoti & Co.: I may have misheard this, but it sounded like the majority of the prepaid adds in 2010 were to Virgin Mobile, first is that correct, and I guess secondly I would have expected more spend towards the Boost Mobile offering, so if you can just give me a little color as to that?

Greg, this is Earle. As far as our mix between Virgin Mobile and Boost, because there was no Boost Mobile customers in our footprint prior to us selling in July, we acquired 50,000 Virgin Mobile customers. So although we have been adding an hefty amount of Boost Mobile, actually at a higher rate than we have Virgin Mobile customers, when you look at our overall mix at year-end, it is dominated by Virgin Mobile, simply because 50,000 of the 66,000 were acquired from Sprint in July. Greg Burns – Sidoti & Co.: Okay. So the majority of the 17,000 added are on the Boost plans?

Yes, that is correct. Greg Burns – Sidoti & Co.: Okay. Then just looking at the OpEx, you know, it has been up as you absorb the cost of the cable acquisitions and the prepaid subscriber acquisitions, are we getting to a point where there is stable run rate, and we start to see I guess an inflection point here, where you start to leverage the growing subscriber base, or should we expect to see OpEx continue to rise from here?

The OpEx that is related to acquiring the customers, we expect Greg to continue to grow significantly as we are successful in acquiring those customers. Certainly we should be at an inflection point with respect to the ongoing cost of supporting customers, and most of the incremental OpEx expending will be related to success based spending, relative to increasing the amount of backhaul that we have to accommodate those customer needs and so forth. Greg Burns – Sidoti & Co.: Okay. Thanks, and lastly, when do you target, I guess, completing the Jet integration?

Well, we have completed the integration and are now on our billing platform, we are now from an operational standpoint have integrated them into our organization. As far as upgrading the networks, we are – there is kind of two halves. We did the hardening of those networks, which really means we went back, we looked at the quality of the network, we fixed any major maintenance issues, we also added power sources at the various nodes. Most of the Jet network did not have backup power. So if there was an interruption of electricity at any one of the locations of the nodes or the head-ins, the systems went down. We completed that in the fourth quarter of 2010. Starting in 2011, and finishing up in the early part of 2012 we will be going back and actually upgrading each one of the networks, putting in the proper amount of electronics, collapsing the number of head-ins, and really then taking advantage of the economies of scale. Simultaneously we are building fiber, and completing the fiber backbone to allow us to have all of those systems on our network, which will provide in the future some significant cost benefits, because Jet had been buying backhaul, and the facilities connect their networks from third parties. By the middle of this year, early third quarter, we will be complete with all of that fiber build and construction and we will be able to have significant amount of capacity on our own network. Greg Burns – Sidoti & Co.: Okay. Thank you.

Thank you. (Operator instructions) And our next question comes from the line of Barry Sine from CapStone Investments. Barry Sine – CapStone Investments: Good morning folks.

Good morning Barry. Barry Sine – CapStone Investments: You may have already covered some of what I am going to ask because I dialed in a little bit late, but let me just go ahead. The first question, prior to Christmas I visited some of your retail stores, especially in the northern markets like Maryland, Pennsylvania, and I’m just curious they seem pretty busy. What has your experience been in some of the new stores you are opening up in those northern areas?

We opened a store – the answer is that they continue to be busy. We are seeing increased foot traffic. We opened a store in the York Galleria Mall in the fourth quarter of last year, and it has already gone to be our busiest store. And so we are very, very encouraged that we are seeing good traffic in existing stores, and as we continue to evaluate the need for distribution, we’re just getting better I think at picking locations, and getting a better bang for our buck. Barry Sine – CapStone Investments: And a question in terms of the prepaid product offering that you have had now for a couple of quarters, in the past, I think you have said that you had a reasonably high percentage of customers who came in, but were denied service for credit issues, and you would hope that prepaid would allow you to convert some of those to actual customers. How has that experience been, who is actually buying prepaid in the retail stores, and what are you using prepaid for in the marketing campaign?

Well, what we found – we actually was a little bit off the mark as far as expecting we would have a huge number of signups of prepaid in our stores. What we found is that those customers already had prepaid, what they were hoping for was to get postpaid so they would get access to the better phones. So we haven’t seen a huge ability to flip customers, who had poor credit on to our prepaid, but I think as we continue to upgrade the quality of the phones that are in the prepaid grouping that may be the case. But what we are seeing is I think typical of what people are seeing across the country on the prepaid. It is those customers who are credit challenged, but also we are actually seeing some of our postpaid customers take a look at their family plans and decide that for some members of their family, that a prepaid phone is a good way to go, in particular for their team, who don’t tend to use as many voice minutes, but use a lot of text minutes, some of our prepaid plans are focused on text, and actually can be a better bargain overall for the family. And so we certainly encourage them to select whatever combination of our products and services give them the right mix, and we’re hoping that that will translate into lower churn going forward. Barry Sine – CapStone Investments: And the question on some of the newly upgraded cable properties, in the markets where you have completed the upgrades, you are now turning to marketing, if we look at the three product sets, where are you seeing the most success, the most traction, where are you having issues and what is your kind of your marketing angle, are you offering a discount at first month, or premium channels, or what is the marketing catch?

You have asked about 12 questions there. I will try to cover them all. As far in the abraded markets, our biggest success has been in data. You have got to remember that in many of these markets, either there was no high speed, or if there was DSL it is relatively low speed DSL. So what we’re able to launch with 3, 5 Megs or higher there is a lot of interest in the market for that. We have also seen quite a bit of interest in people taking phone from us. It is a little bit more difficult in an area where we do not have brand loyalty to get the customer to switch off of the satellite. But we are still having good as you can see good growth in video also. But the two that have been the strongest for us have been the broadband and the voice. As far as marketing, we are looking – we do try to sell bundles, and we try to do it with a consultive sale, whether on the phone or door-to-door trying to find out exactly what the customer’s needs are, and put together a bundle, either a two service bundle or a three service bundle depending on the need. We do offer a couple of months of discounted service, we have not offered free service. We offer some discounted services in order to entice the customer on. And at this point we use waiving installation fees is probably our primary marketing tool. Did I miss any question? Barry Sine – CapStone Investments: No, you got them all, but to follow up on that, just to help us understand a little bit better the competitive situation, obviously you don’t have FiOS in those markets, you don’t have an overbuilder. Satellite is very important on video, and the telco has obviously got voice and rudimentary data. Is that a fair way to look at the…

That is a fair way. The only place that there will be some fiber is you may be familiar – or aware that NTELOS [ph] got some stimulus monies to build fiber in Allegany County, Virginia, which is where our Covington, Clifton Forge, systems are. And they are in the process of building right now, so there will be some competition there as far as a faster pipe than a DSL pipe. But from a pricing standpoint, we haven’t seen any strange pricing in that market and we have been able to upgrade that market to now offer 20 megs over our cable system. So, we feel like we have got a very competitive network even where there is fiber being built. Barry Sine – CapStone Investments: And just last question quickly, any update on the sale process on Converged Systems?

We continue to work with several potential buyers. They are basically the same folks that we have been working with. The real issue has been their ability to raise the funds. We are not interested in being the bank for them. And have continued to run the markets. We have seen no deterioration in the number of customers or the number of cut properties that we are maintaining, and so we will continue to operate those markets effectively until we find the right buyer.

Thank you. Our next question comes from the line of Greg Burns from Sidoti & Co. Greg Burns – Sidoti & Co.: Hi, just two quick follow-ups, Adele, what should we be modeling for depreciation and amortization this year, and also looking at the cost of service, do you think gross margin has bottomed this quarter, or do you see going a little lower in the coming quarters?

The cost of acquisition should be reflected in SG&A. So it would directly impact the gross margin. Gross margins have been fairly profoundly affected by the acquisition of Jet, and the video programming cost related to that like other video providers, the video revenues – the programming fees rather run about 50% of video revenues. So to the extent that as Earle points out, we are selling more voice and more high-speed data, the gross margins will improve going forward. So I think it is reasonable from that vantage point to expect that the gross margins would improve, particularly in the cable business. Greg Burns – Sidoti & Co.: Okay, and depreciation and amortization for this year?

Depreciation and amortization for this year, I think you can expect that the new CapEx spending that we incur would average about 7 to 8 years, depreciation or useful life. And if you use that assumption Greg you should be in pretty good shape. Greg Burns – Sidoti & Co.: Okay. Thank you.

Thank you. And I see no further questions in the queue at this time.

All right. Thank you for participating. We would like to invite you to let me know, Adele Skolits, if you have any additional details you would like to see covered on other calls. Karen, it appears that we have one additional question before I wrap up.

Certainly. Our next question comes from the line of Will Lauber of Sterling Capital. Will Lauber – Sterling Capital: Hi, yes, if you can just kind of walk me through the economics of the prepaid business, where do you start getting more profitability that you get a longer customer life or the acquisition cost go down, what is kind of the driver going forward hopefully?

Will, this is Earle. Basically, we’ve always expensed the cost of acquisition of a customer in the month of – that is acquired. We are looking at an acquisition cost in the $140, $150 range currently for a prepaid customer. The churn rate has been below 5, which means that a customer will be on for approximately 20 to 24 months. We haven’t been in the business long enough to know if that is – how accurate that is but I think it is a pretty good estimate. And so when you look at the average revenue that we showed, the acquisition cost and the monthly cost of maintaining that customer is in the single digits. You do reach the point after 10 months or so, where that customer is contributing significantly to the bottom line. The reason why we have seen the negative impact in 2010 is because we put on a lot of customers very, very quickly and have not had them long enough for them to be able to provide that contribution to the bottom line. Will Lauber – Sterling Capital: How sensitive are those customers, and I guess I don't know how the handset subsidies work but, say, 12 months if you are promoting a new and better phone, how sensitive are they to kind of upgrading, or can they do that, how does that work?

Well, if they upgrade it is much more on their nickel than on ours, unlike in the postpaid business where you go in and based on how long you have been on the network and what price plan you are on, you get a very, very deep discount on a new phone. On prepaid, if you want a new phone you are going to have to go to the rack and pick up the phone and pay for it. We will allow you to move your current phone number to that new phone, but there is not the subsidy that you see in the postpaid business. Lauber – Sterling Capital: Is there any kind of upgrades at all if I go in tomorrow and buy a prepaid plan, and then I guess you are heavily subsidizing that handset, at some point can you – do you subsidize any more handsets for the person, or how does that work?

Well, we do subsidize some, but not nearly to the point that we subsidize a postpaid customer. You’ve got to remember in that $130, $140 on the postpaid side that can be three times that. By the time you add all of them, because the $130, $140 I talked about is not just the phone, it is all the other marketing and support cost it takes to acquire a customer. So there is no question that there is some subsidy in the purchase of a prepaid phone, but you are not having that same cost again relative to a postpaid that you have on the prepaid. Will Lauber – Sterling Capital: To say if it is $100 a year subsidizing that phone, and I stay with you for 10, 12 months, and then I want to get the latest phone, do you subsidize that at all – I guess, what is the – I mean if your prices for one phone for postpaid people is say $100, and you are subsidizing that $300, what is the price to the postpaid or the prepaid person?

Well, it is probably closer to the $30, $40 range. Will Lauber – Sterling Capital: Okay, all right. Thank you.

Thank you. And our next question is a follow up from the line of Ric Prentiss with Raymond James. Ric Prentiss – Raymond James: Hi guys, just wanted one quick follow up, just going back to the stat that 34% of your postpaid base is on smart phones, I just want to make sure we get what your definition of what a smart phone is, what is included?

Basically it is the blackberries, the EVOs, the Epics, it truly has to be – it is not just a slider phone that you do texting on, it truly is one that has the applications. Ric Prentiss – Raymond James: Sure, it is like a Rumor touch screen would not count. Correct?

Right. Ric Prentiss – Raymond James: Okay. Thank you guys. Thanks.

You are welcome.

And it doesn’t appear there are many more questions. So that concludes our call for today. Thank you for joining us.

And again, ladies and gentlemen, this does conclude today’s conference. We thank you for your participation. You may now disconnect.