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Page 1: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

“Our cooperative’s vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering advanced services with honest and personal service.”

Page 2: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

Executive Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Highlights of Operation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

Integrating Voice and Data For A Critical Business Edge . . . . . . . . . . . . . .4

Beyond Broadband . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

SkyBest Security Means Peace of Mind . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Enhancing Education Through Technology . . . . . . . . . . . . . . . . . . . . . . . .10

Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

Financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14

Community Involvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

Service and Dedication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

Table of Contents

Page 3: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

1SkyLine Membership Corporation

Despite a difficult economic environment,

2009 was a year of progress and

achievement for SkyLine Membership

Corporation. We were able to meet our financial

goals in an industry that is becoming more

challenging and competitive every year. In

addition to finishing the year with a strong

financial position, we were able to increase our

portfolio of services and expand the scale and

scope of our fiber network. I’d like to thank a

talented team of employees with a clear customer

focus for being able to accomplish so much over

the past year. Whether it’s meeting service

expectations, providing new services, supporting

schools and communities, or just listening to

customer requests, our focus remains on putting

the member at the center of all we do.

Robust Fiber Network

During 2009, our fiber network was expanded by

100 miles, reaching 13 communities, making

SkyBestTV service now available to over 7,800

members. Our emphasis on fiber deployment

remains strong as more communities across our

service areas will be seeing fiber deployed in the

near future. SkyLine was notified on July 2, 2010,

that it would be a recipient of a broadband

stimulus grant in the amount of $20,289,706,

accompanied by a loan of $8,695,588. The funds

will be utilized to construct 889 miles of fiber in

the counties of Ashe and Alleghany in North

Carolina and in the exchange of Shady Valley,

Tennessee. The grant is part of the American

Recovery and Reinvestment Act (ARRA) and

requires that the funded areas be completely

constructed in three (3) years. Since not all of the

communities located in the counties stated above

were eligible for stimulus funding, there will be

additional fiber construction remaining after the

three-year period. Even though Watauga and

Avery counties were not eligible for stimulus

funding and will not be part of the stimulus

project, SkyLine will continue its commitment to

deploy fiber facilities in these areas at a rapid

pace. The commitment made some seven years

ago by this cooperative to begin building a robust

FTTP network, aided by the recent stimulus award,

will accelerate our deployment efforts and position

Executive Report - From Our President & CEO

Page 4: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

2 2010 Annual Meeting Report2 2010 Annual Meeting Report

SkyLine to deliver the promise of broadband and

other next-step technologies of the future.

SkyBest Security

In addition to expanding our fiber network in

2009, SkyBest Security was launched in August of

2009 by SkyBest Communications Inc., a wholly-

owned subsidiary of SkyLine. SkyBest Security is a

suite of state-of-the-art services that offers

protection against break-ins, fire, water and other

damages as well as Medical Alert for the elderly

and others with health concerns. Our goal is to

become the premier security provider in the High

Country, where customers can get dependable

local security service at a reasonable price. We

have been delighted with the positive response by

our customers to this service.

SkyBest in Boone

In September 2009, SkyBest began offering

service as a Competitive Local Exchange Carrier

(CLEC) to parts of downtown Boone. Our network

is set apart from other CLECs in this area because

it is a 100-percent fiber optic network. Going

forward, we believe we can take advantage of

market opportunities due to our operating

efficiencies and the scalability of our fiber network

in this area. We are encouraged by the trends and

early successes of the new Boone market.

Financial Strength

In the financial section of this report, you’ll

note that the cooperative finished last year

with a consolidated margin of $5,699,062,

while our wholly-owned subsidiary, SkyBest

Communications, Inc., finished with a slight

negative margin of $66,935. Our financial strength

is further reflected by our stable and predictable

cash flows. During 2009, our overall debt increased

by just seven percent. We remain disciplined about

our capital credit refund policy, and our Board of

Directors recently approved a 1.4 million dollar

capital credit disbursement for 2010.

Regulatory Reform

The unpredictable regulatory landscape is poised

to have a tremendous impact on our business.

SkyLine supports efforts to develop a national

broadband plan which will modernize regulations

governing the Universal Service Fund and

intercarrier compensation reform. We feel these

regulatory efforts should promote affordable

broadband connectivity and address the unique

challenges of serving rural communities such as

ours. Advanced networks like SkyLine’s are the

product of years of capital investment and require

ongoing investment to improve and meet

customer demand. We will continue to work with

the legislators and regulators to create resolutions.

Executive Report - From Our President & CEO (Continued)

“2009 was a year of progress and achievementfor SkyLine Membership Corporation.”

SkyLine President R.C. Mitchell, at left, and SkyLine CEO Jimmy Blevins.

Page 5: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

3SkyLine Membership Corporation

$31,924,802

$26,785,831

$518,692

$5,699,062

$10,433,225

$170,372,342

36,887

28,323

130

$32,005,191

$27,917,132

$1,542,132

$5,695,109

$15,224,827

$163,649,073

37,776

28,866

128

($80,389)

($1,131,301)

($1,023,440)

$3,953

($4,791,602)

$6,723,269

(889)

(543)

2

Operating Revenues

Operating Expenses

Other Income/Expenses

Consolidated Margin

Capital Expenditures

Investment in Property & Equipment

Lines Serving Customers at Year End

Number of Members

Number of Employees at Year End

2009 2008 Net increase(decrease)

Total Access Lines(SkyLine & SkyBest combined)

N.C. Telephone CooperativesTotal Access Lines

(as of 08-2010)

35,000 36,2

79

38,9

67

38,8

40

37,7

76

36,8

87

36,000

37,000

38,000

39,000

2010ytd as of 08-2010

2006 2007 2008 2009

Atlantic ..........................................38,983Randolph.........................................9,194SkyLine......................................33,564Star ................................................16,687Surry ..............................................15,393Tri-County........................................3,028Wilkes ..............................................9,827Yadkin Valley .................................25,485

As of 08-2010 As of 08-2009

Decisions Are Made Here

While 2009 was an outstanding year of progress

and achievement, we remain well aware of the

challenges that lie ahead on the horizon. We

expect a slow economic recovery to limit growth

opportunities in the near term. We also anticipate

continued regulatory uncertainty as policymakers

pursue regulatory reform in the aftermath of the

FCC’s Broadband Plan published in February 2010.

We believe we are well positioned to meet the

challenges ahead. We have a strong financial

position, a robust and growing fiber network, a

forward-thinking Board of Directors, valuable

community partnerships, and dedicated employees

who put our customers first, along with exhibiting

an incredible capacity for change. Our cooperative’s

vision extends beyond the horizon as we seek to

improve lives, strengthen businesses, and connect

communities by delivering advanced services with

honest and personal service.

Thank you for your continued support.

Highlights of Operation

Jimmy C. BlevinsChief Executive Officer SkyLine Membership Corporation

R.C. Mitchell President SkyLine Membership Corporation

Page 6: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

4 2010 Annual Meeting Report4 2010 Annual Meeting ReportThe Ashe County Courthouse building and other county agencies now have a new integrated voice and data

phone system featuring VoIP technology through SkyLine/SkyBest.

Page 7: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

5SkyLine Membership Corporation

Integrating Voice and Data For A Critical Business Edge

R ecently, the Ashe County Government

collaborated with SkyLine/SkyBest to

integrate and upgrade their phone and

data system. The new VoIP phone system the

county installed keeps pace with users in multiple

buildings including the Ashe County Law

Enforcement Center, Ashe County Courthouse

and Administration Building and the Ashe County

Agricultural Extension Office.

Convenient features include presence

management and collaboration, as well as the

implementation of wireless headsets. Ashe

County Sheriff James Williams appreciates

cordless devices and other features of the new

system. “It works well to have wireless headsets

and be able to walk through the building while

still on phone calls. I also like managing voice mail

on the computer and connecting to other Ashe

County staff members by dialing just four digits,”

says Williams. Ashe County Manager Dan

McMillan, agrees that the new phone system is

beneficial. He explains, “I know this system will

continue to benefit us in the future and allow us

to work more efficiently.”

Redundancy was another important issue for Ashe

County, since phone communications are literally

a life-and-death matter for 911 Emergency

Management. SkyLine/SkyBest made sure the

system provided redundancy and resiliency;

hardware is able to shift, and if one controller is

down, calls go through the other controller. “I

can't tell you how much I appreciate SkyLine,”

says Williams. “They worked day and night to get

us in here; they practically did back flips. You

don't get that kind of service everywhere.”

“The SkyLine folks checked and double checked to make sure wewere all up and running when the phone system was installed.”

- Lisa Harless, an Administrative Assistant at Social Services

Page 8: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

6 2010 Annual Meeting Report6 2010 Annual Meeting ReportSkyLine Field Services Technician Todd Young brings fiber-based services to the home through an Optical Network Terminal (ONT),

the replacement for the Network Interface Device(NID), which connected copper-based services to the customer’s location.

Page 9: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

7SkyLine Membership Corporation

Beyond Broadband

I n the 1930s, the introduction of electricity

and telephone service radically changed the

daily lives and possibilities of American

communities. Today, broadband service is poised

to make a similar impact.

SkyLine understood the power and potential of

broadband years ago. As early as 2002 we began

planning to build out a Fiber To The Premises

(FTTP) network for our entire service area, and in

2004 we began the project in earnest.

Fiber optic networks offer consumers a powerful,

high-quality connection to the Internet. This

means faster upload and download speeds that

enable consumers to stream video and access

large files on the Internet—or add their own

content to the Web quickly and without

disruption. Fiber enhances high-definition (HD)

programming, and even improves non-HD

television: think clearer pictures, more channels,

and increased options. And, digital telephone

service transmitted over a fiber network provides

a crystal clear connection to the world.

This year, we were able to provide a significant

upgrade to our customers at no additional

charge. In May, our new Internet line-up of service

options featured download speeds ranging from

4.0 and 8.0 Mbps all the way up to 20 Mbps.

In August, we received the extraordinary news

that SkyLine had been awarded $28.9 million

from the U.S. Department of Agriculture

(USDA) – Rural Development. The grant will

greatly accelerate the timeline of our planned

system-wide FTTP build-out, and allow us to

bring fiber technology to 25 rural communities

within the next three years.

This substantial investment underscores our

continued commitment to bring our customers

the latest in telecommunications technology.

“Building a broadband infrastructure is the key to creatingjobs and economic opportunity in rural areas.”

- Randall Gore, North Carolina Rural Development State Director

Page 10: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

8 2010 Annual Meeting Report8 2010 Annual Meeting ReportMs. Beth Absher of Jefferson, NC first learned of SkyBest’s Security and Medical Alert services

through her daughter Becky, who has the security service for her business.

Page 11: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

9SkyLine Membership Corporation

SkyBest Security Means Peace of Mind

S ecurity continues to be a concern for every

property owner. To protect and deter,

SkyBest Security offers a suite of security-

related services – from sophisticated glass break

and motion detectors to sensors that can sense

water in case of a leak.

A growing service line within our security offerings

is the SkyBest Medical Alert Service, an affordable

way to give the elderly or those with health

concerns more security and independence.

Ms. Beth Absher of Jefferson, NC first learned of

SkyBest’s Security and Medical Alert services

through her daughter Becky, who has the security

service for her business. “She thought it would

be a good thing for me to have. We all want our

independence as long as we can have it,

and I really feel more secure with it,”

Ms. Absher explained.

The system comes with a pendant so customers

can easily and immediately call for help. More

than simply a basic medical alert device, the

SkyBest control panel works as an additional

telephone in the home. It can record messages to

serve as reminders to the homeowner or family

members helping with household chores or other

personal needs, and it is an additional way to alert

not just emergency rescue but also the local

police and fire departments. For medical and

police, the alert will establish two-way voice with

Security Central station personnel, but if the fire

alert is activated on the control panel, the closest

fire department will be dispatched directly.

To date, we have seen steady growth of security

systems and medical alert monitoring systems in

Alleghany, Ashe, Avery and Watauga counties.

“We all want our independence as long as we can have it,and I really feel more secure with it.”

- Beth Absher, Jefferson, NC

Page 12: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

10 2010 Annual Meeting Report10 2010 Annual Meeting ReportDr. Marty Hemric, Superintendent of Watauga County Schools, and Dr. Scarlet Davis, Assistant

Superintendent, with SkyLine’s Business Account Executive Brent Keith.

Page 13: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

11SkyLine Membership Corporation 11

Enhancing Education Through Technology

T his past year, SkyLine/SkyBest was

proud to work with the Watauga

County School system to bring all

nine of their county schools under one Wide

Area Network (WAN). “With the expanded

change in service, our school system has also

upgraded the symmetrical WAN speed to

1 Gbps, a generous gain from what we

previously had,” said Dr. Scarlet Davis, Assistant

Superintendent of Watauga County Schools.

“This allows our schools to take advantage of

centralized resources, such as digital video and

instructional web-based resources as well as

lesson plans and unique video resources that

reside at individual schools.”

Dr. Marty T. Hemric, Superintendent of the

Watauga County Schools, was delighted by the

collaboration's results. “The time commitment

and the sincerity portrayed by SkyLine

employees represent SkyLine's willingness to

learn about the vision of our system. The

collaborative planning for our service upgrades

with the metro-e broadband design has aligned

our data capacity with our vision and improved

infrastructure to support our efforts in providing

a state-of-the-art 21st Century education for our

youth,” Dr. Hemric said.

The improved WAN architecture provided by

SkyLine/SkyBest also allows Watauga County

Schools to provide broadband access through

a single point of entry, allowing the school

system to gauge bandwidth use and to control

content at all nine schools. Adds Dr. Davis,

“We are very excited about the recent

expansion of our partnership with

SkyLine/SkyBest, and we look forward to

‘growing’ with them in the future.”

“SkyLine continues to be a very integral partner in the enhancementof teaching and learning in the Watauga County Schools.”

- Dr. Marty T. Hemric, Ed.D, Superintendent, Watauga County Schools

Watauga CountySchools Central

Office

Hardin Park Elementary

Parkway Elementary

Blowing Rock Elementary

Watauga High School

Bethel Elementary

Mabel Elementary

Green Valley Elementary

Valle Crucis Elementary

Cove Creek Elementary

Page 14: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

12 2010 Annual Meeting Report12 2010 Annual Meeting ReportMembers of the SkyLine Board of Directors and SkyBest Board of Directors with SkyLine CEO Jimmy Blevins.

Page 15: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

13SkyLine Membership Corporation

Standing left to right: Raymond A. Parker, II, Attorney; Joseph McNeil; Molly Gambill; D.C. Smith; James L. Shepherd, Secretary; Ray WardSeated left to right: I.S. Cooper, Treasurer; Buster Burleson, Vice-President; Jimmy Blevins, CEO; J.L. Shumate, Assistant Secretary; R.C. Mitchell, President

Standing left to right: R.C. Mitchell, Assistant Secretary; James L. Shepherd; Haskell McGuire; Raymond A. Parker, II, AttorneySeated left to right: Dennis Gambill, Vice-President; Joseph McNeil, Treasurer; Jimmy Blevins, President; Buster Burleson, Chairman; Jerry Roten, Secretary

SkyLine Membership Corporation Board of Directors

SkyBest Communications, Inc. Board of Directors

SkyLine Membership Corporation is a local,

member-owned cooperative, established in 1951 to

bring telephone service to rural residents of

Alleghany, Ashe and Watauga counties. SkyLine

serves a 12-exchange network with over 33,000

access lines across a five-county area in northwest

North Carolina and east Tennessee. The company

also co-owns Carolina West Wireless, a regional

wireless carrier operating in 10 northwest North

Carolina counties.

SkyBest Communications, Inc. is a wholly-owned

subsidiary of SkyLine Membership Corporation.

Established in 1998, SkyBest is a competitive local

exchange carrier (CLEC), offering a variety of

deregulated services including dial-up and

broadband Internet, long-distance, dial tone,

business and network solutions, SkyBest Security

and SkyBest TV over an expanding fiber network.

Board of Directors

Page 16: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

14 2010 Annual Meeting Report14 2010 Annual Meeting Report

FinancialsSkyLine Membership Corporation Consolidated Balance SheetYear Ended December 31, 2009

6,943,8353,558,5809,181,2652,065,338

4,641378,985

22,132,644

6,382,965576,000

12,585,9191,648,1851,952,222

023,145,291

164,767,8015,545,005

59,536170,372,342105,514,99064,857,352

110,135,287

$

$

Current Assets: Cash and temporary investments Accounts receivable (less allowances) Investment in debt and equity securities Materials and supplies Deferred income taxes Prepayments and deferred charges Total Current Assets Non-Current Assets: Investment in debt and equity securities Goodwill Equity investment Other investments (net) Notes receivable Prepaid post retirement benefits Total Non-Current Assets Property and Equipment: Telecommunications plant in service Telecommunications plant under construction Non-operating plant Total Property and Equipment Less, Accumulated Depreciation Net Property and Equipment

Total Assets:

2,056,3771,854,2551,102,7432,164,7447,178,119

5,659,155580,714

3,103,566329,751

9,673,186

16,851,305

(5,176,292)98,460,274

93,283,982

110,135,287

$

$

Current Liabilities: Accounts payable and customer deposits Advance billings and payments Current maturities on long-term debt Accrued liabilities Total Current Liabilities

Non-Current Liabilities: Long-term debt, less current maturities Deferred compensation Post retirement benefits Deferred income taxes Total Non-Current Liabilities

Total Liabilities:

Capitalization: Accumulated other comprehensive income (loss) Patronage capital Total Capitalization

Total Liabilities and Capitalization:

LIABILITIES & CAPITALIZATION

Page 17: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

15SkyLine Membership Corporation

FinancialsSkyLine Membership Corporation Consolidated Statement of Revenues and Expenses

Year Ended December 31, 2009

Maintenance$7,472,933 - 22.84%

Non-Operating Revenue$747,596 - 2.28%

Miscellaneous$1,855,646 - 5.67%

Local Service$9,249,103 - 28.25%

Toll/Access$11,384,658 - 34.78%

Other Sales & Service Income$9,599,848 - 29.32%

Depreciation$9,060,193 - 27.70%

Interest on Debt$228,904 - 0.70%

Customer/Corporate Operations$10,252,705 - 31.34%

Member Ownership$5,699,062 - 17.42%

Uncollectible Revenue$0 - 0%

Federal & State Taxes$64,918 - 0.20%

How our dollars are spent

How our dollars are received

Bad Debt Recovery($164,453) - -.50%

9,249,10311,384,6589,599,8481,855,646(164,453)

31,924,802

4,639,4832,833,4509,060,1933,911,2076,341,498

26,785,831

5,138,971

743,123187,076335,211

0(517,814)(228,904)518,692

5,657,663(41,399)

5,699,062

$

$

Operating Revenues: Basic local network service Network access and long-distance revenue Internet and other sales and services Other Less uncollectible Total Operating Revenues Operating Expenses: Plant specific operations Plant non-specific operations Depreciation and amortization Customer operations Corporate operations Total Operating Expenses Operating Income:

Non-Operating Income (Expenses): Investment income Allowance for funds used in construction Earnings from equity investments (net) Gain on sale of investment Realized gain (loss) on sale of securities available for sale Interest expense Total Non-Operating Income

Net margins before income taxes Federal and state income taxes (benefits) Net Margins for the Year

Page 18: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

16 2010 Annual Meeting Report16 2010 Annual Meeting Report

FinancialsSkyBest Communications, Inc. Balance SheetYear Ended December 31, 2009

286,388234,64923,70718,6904,641

568,075

3,3551,086,0941,089,449

6,941,525223,093

7,164,6182,228,0724,936,546

6,594,070

$

$

Current Assets: Cash Accounts receivable parent company Other accounts receivable Prepayments and deferred charges Deferred income taxes Total Current Assets Non-Current Assets: Equity investment Parent company capital credits receivable Total Non-Current Assets Property and Equipment: Telecommunications plant in service Telecommunications plant under construction Total property and equipment Less, accumulated depreciation Net Property and Equipment

Total Assets:

127,6681,172,567

545,77666,473

1,912,484

2,755,610329,751

3,085,361

4,997,845

200,0001,000,000

396,2251,596,225

6,594,070

$

$

Current Liabilities: Accounts payable and customer deposits Accounts payable parent company Current maturities on long-term debt Accrued liabilities Total Current Liabilities

Non-Current Liabilities: Long-term debt, less current maturities Deferred income taxes Total Non-Current Liabilities

Total Liabilities:

Capitalization: Capital stock Additional paid-in capital Retained earnings Total Capitalization

Total Liabilities and Capitalization:

LIABILITIES & CAPITALIZATION

Page 19: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

17SkyLine Membership Corporation

FinancialsSkyBest Communications, Inc. Statement of Revenues and Expenses

Year Ended December 31, 2009

869,8232,446,3766,464,503

246,091 614,603818,996(27,854)

11,432,476

1,460,1983,716,483

597,1931,796,4493,746,082

11,316,405

116,133

6,230(144,372)(91,981)

5,656(224,467)

(108,334)(41,399)

(66,935)

$

$

Operating Revenues: Basic local network service Network access and long-distance revenue Internet revenue Lease revenue Inside wire maintenance Other revenue Recoveries (uncollectible revenue) Total Operating Revenues Operating Expenses: Plant specific operations Plant non-specific operations Depreciation and amortization Customer operations Corporate operations Total Operating Expenses Operating Income (Loss):

Non-Operating Income (Expenses): Investment income Interest on long-term debt Loss from equity investment Allowance for funds used in construction Total Non-Operating Income

Income before income taxes Federal and state income taxes (benefits) Net Income (Loss) for the Year

Page 20: beyond the horizon - SkyLine/SkyBest · 2014. 12. 9. · vision extends beyond the horizon as we seek to improve lives, strengthen businesses, and connect communities by delivering

18 2010 Annual Meeting Report18 2010 Annual Meeting Report

Community Involvement

1. Now in its fifth year, ourTechnology Education GrantProgram awarded $55,000 in2010 to public school systemsin Alleghany, Ashe, Avery,Watauga and Johnson countiestoward the purchase of SMARTBoards and related equipment.To date, SkyLine hascontributed over a quarter of a million dollars through thisinitiative to support technologyin our public schools.

2. Project Teamwork, our employee-led communityoutreach program, has raisedmore than $75,000 over thepast 14 years to offerimmediate financial assistanceto area families during times of crisis.

3. SkyLine continued its support of the popular SummerTheatre program at Lees-McRae College again this year.The college’s production,Ragtime: The Musical, featuredthe largest cast ever placed onthe Lees-McRae stage.

4. SkyLine’s subsidiary, SkyBestCommunications, is the officialtelecommunications partnerwith ASU Athletics, and it wasthe presenting sponsor of three events at An AppalachianSummer Festival, whichprovides cultural enrichment to the region and keepsadmission prices moreaffordable for our members.

5. Anderson Profitt, a WataugaHigh School senior, was one of 30 students nationwide toreceive the Foundation for Rural Service (FRS) Scholarship,sponsored locally by SkyLine.The scholarship, worth $2,500,is presented especially to thosestudents who desire to return toa rural community followingcollege. Anderson is the sixtharea student to receive thisscholarship since 2006.

6. Area public schools partnerwith SkyLine to raise awarenessabout the benefits of recyclingby collecting outdatedtelephone directories; in turn,the co-op rewards schools withfinancial donations for theirefforts, which to date exceed$85,000, and support numerousschool needs, including librarybooks, campus beautificationprojects field trips and classroomsupplies, among others.

1.

2.

3.

4. 6.

5.

Pictured are Dennis Brown & Dr. KeithEades of Avery County Schools withSkyLine CEO Jimmy Blevins.

Mabel Elementary topped school collections of old directories this year.

Anderson Profitt.

Ralph Stanley was featured at An AppalachianSummer Festival this summer.

Presenting the sponsorship check to Dr. Janet Barton Speer, LMC SummerTheatre Artistic Director, are SkyLine directors Buster Burleson and D.C.Smith of Avery County with SkyLine Public Relations Director Karen Powell.

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19SkyLine Membership Corporation

Community Involvement

7. This year, SkyLine is awarding$28,000 in college scholarshipsto children of SkyLine membersthrough the co-op’s FrankJames-SkyLine Scholarship.Pictured are this year’s winnersfrom Alleghany County withSkyLine board membersrepresenting Alleghany County.

8. To support the work of theAmerican Heart Association,SkyLine annually has providedthe phone bank at theAlleghany Heart Auction andthe Ashe Heart Auction. AsheCounty employees also field ateam each year for the annualHeart Walk and raised over$2,500 in 2010.

9. SkyLine is a local sponsor of the Cooperative Council ofNorth Carolina’s CooperativeYouth Leadership Conferencefor high school students at theNC FFA Center at White Lake,NC. Sponsored by cooperativesand agricultural organizations,the leadership camp helpsstudents build leadership skills while learning aboutcooperatives.

10. Since 1996, SkyLine hassponsored area high schooljuniors for this five-dayexperience of a lifetime, whichincludes tours of our nation’smost cherished landmarks,opportunities to seegovernment in action andprograms that emphasize thevital role of telecommunicationsin rural communities.

11. Since 1995, SkyLineemployees have supported theAmerican Cancer Society’sRelay for Life, and this year,held a company-wide pledgecampaign that netted morethan $8,000 in support of Relayfor Life with donations spreadacross our service area.

12. Tri-State Components inAlleghany County is the mostrecent recipient of fundingthrough SkyLine’s RevolvingLoan Fund program, whichprovides zero-interest loans toorganizations that supplyessential community servicesand create or retain local jobs.Tri-State’s expansion will supportthe local service industry andbring approximately 20 full-timejobs to the area.

8.

7. 9.

11.

12.

Pictured are scholarship winners from Alleghany Countywith Directors Mitchell and Shepherd.

SkyLine’s Myla Farmer, shown here with daughter Isabella,is among many SkyLine employees who bring their familiesto this annual community event that reminds us to“celebrate, remember and fight back” as we seek toeliminate cancer as a major health disease.

Ashe County survivors walk the ceremonial first lap of Relayfor Life.

Pictured at the FDR Memorial in Washington, D.C. are Leah Himmelman of AveryCounty and Kristen Clarke of Ashe County.

SkyLine directors Jim Shepherd, left, and R.C. Mitchell, right,present the Revolving Loan Fund check to John Miller of Tri-StateComponents in Sparta.

Co-op Leadership Conference Participants (left to right): Chelsea Reavis, Meghan Vannoy, Leah Himmelman, Rebecca Duncan and Rachel Scott.

Ashe County Heart Auction volunteers, left to right: Jeff Sheets, June McMillan,Robin Marlow, SkyLine’s Mary Sexton and Seth Sheets.

10.

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20 2010 Annual Meeting Report20 2010 Annual Meeting ReportThese employees are among several who are celebrating incremental service anniversaries with SkyLine this year.

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21SkyLine Membership Corporation

Angie Miller8/16

Brantley Davis 5/1

Danny Lawrence5/1

Greg Richardson5/1

Michelle Graybeal8/7

Felicia Busic9/12

Amber Osborne10/1

Josh Crumpton10/3

Scott Hughes9/6

Justin Greene8/29

D.C. SmithDirector 6/7

Service and Dedication

5 Years Service 10 Years Service

Kathy Pollard6/12

Shannon Lyalls3/8

Greg Jones4/17

Greg Poe4/17

Pam Weaver6/5

Tim Watson9/6

Steven Hardin7/20

Ann Estes2/16

Robbie Farmer2/17

Kirk Houck3/8

Bernard Clouse 2/1

Shauna Powers1/16

Molly GambillDirector 1/9

15 Years Service

Phillip May9/1

Jimmy BlevinsCEO 9/16

Jim ShepherdDirector 10/5

Kevin Colvard9/1

Kenny Church 9/1

Karen Powell6/1

20 Years Service

25 Years Service

RetireeAudrey Chambers26 Years of Service

RetireeJ.L. ShumateDirector51 Years of Service

In MemoryThomas JohnstonFormer SkyLine Attorney

50 Years ServiceR.C. MitchellPresident 8/2

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Our mission is to provide competitively priced, high-quality products and services to ourcustomers, to meet their diverse needs. We recognize those who have an interest in ourorganization and we will represent them with respect and integrity in all of our actions. Forour members/owners, we will be good stewards of their investment to ensure long-termfinancial viability. For our customers, we will strive to identify their needs and continue todevelop an innovative, efficient and effective network. For our employees, we will equipthem with the opportunities and tools needed to be successful in their careers. For ourcommunities, we will be good corporate citizens and strive to enhance the quality of lifein the areas we serve.

P.O. Box 7591200 NC Hwy 194 N.

West Jefferson, NC 28694

(800) 759.2226 toll free(336) 877.3111 phone

(336) 877.2020 fax

www.skyline.orgwww.skybest.com

West JeffersonSparta

Seven Devils