CTE Reports 2006 Fourth Quarter Results:

Business Wire, Feb 27, 2007

CTE's reported consolidated revenues for the 2006 full year were $330.6 million, a decline of 1% versus the 2005 full year reported revenues of $333.9 million. Consolidated reported operating income was $113.5 million, versus $112.1 million for the 2005 full year, reflecting an increase of 1%. Consolidated capital expenditures were $47.2 million, versus $43.9 million for the 2005 full year, reflecting an increase of 8%, which was largely in support of the expansion of CTE's broadband network and product offerings.

The table below sets forth highlights of CTE's 2006 full year reported consolidated results, versus the 2005 full year consolidated results:

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Commonwealth Telephone Company Results

Commonwealth Telephone Company had a total of 309,279 switched access lines in service at the end of the 2006 fourth quarter - reflecting a reduction of 4% versus last year's fourth quarter. CT's primary residential access lines in service declined 2% versus the end of the 2005 fourth quarter. CT's residential additional line penetration was 30% at the end of the quarter, down from 33% in the year ago quarter, and just below the 31% penetration level at the end of the 2006 third quarter.

In the 2006 fourth quarter, CT installed 3,788 net new DSL subscribers. CT had 39,890 DSL subscribers in service at the end of the 2006 fourth quarter, having added a record total of 14,292 net new subscribers over the past four quarters, which reflected a growth rate of 56% versus the end of last year's fourth quarter.

CT's 2006 fourth quarter reported revenues were $57.0 million, reflecting a 1% decrease versus CT's reported revenues of $57.8 million in the 2005 fourth quarter. For the 2006 full year, CT's reported revenues were $228.9 million, versus reported revenues of $228.5 million in the prior year.

CT's 2006 fourth quarter reported operating income was $30.9 million, versus $31.4 million in the 2005 fourth quarter. CT's reported expenses in the 2005 fourth quarter included the previously mentioned favorable non-cash sales and use tax settlement, which was $2.8 million. For the 2006 full year, CT's reported operating income was $122.1 million, versus 2005 full year reported operating income of $111.9 million.

CT's 2006 fourth quarter CAPEX were $8.0 million, versus $8.6 million in the 2005 fourth quarter. For the 2006 full year, CT's CAPEX were $30.7 million, versus 2005 full year CAPEX of $27.2 million.

CTSI Results

CTSI had a total of 142,613 switched access lines in service at the end of the 2006 fourth quarter - reflecting a 4% increase versus the 137,696 switched access lines in service at the end of the 2005 fourth quarter. CTSI's general business access lines in service increased 7% over the past year, while CTSI's access lines in service to ISP customers continued to decline, as the dial-up ISP business continued to weaken. At the end of the 2006 fourth quarter, 99% of CTSI's access lines were "on-switch," and 52% were "on-net" (defined as 100% on CTSI's owned network). CTSI's business/residential line split at the end of the 2006 fourth quarter was 92%/8%, reflecting a slightly higher business component versus the end of the 2005 fourth quarter.