What happened

Shares of Consolidated Communications (NASDAQ:CNSL) traded up more than 12% on Thursday afternoon after the broadband provider reported third-quarter results that came in ahead of expectations. The shares are still down considerably for the year, but Consolidated Communications is showing signs of success executing on the debt reduction plan that sent shareholders running for the exits in April.

So what

Before markets opened Thursday, Consolidated reported adjusted earnings of $0.06 per share on revenue of $333.3 million, beating analyst expectations for a $0.04 per-share loss on revenue of $332 million. The company also reaffirmed its guidance for full-year adjusted EBITDA of $520 million to $525 million, while raising its full-year capital expenditures estimate by $10 million to $220 million-$225 million due in part to hurricane damage in some of its markets.

A laptop made to look like the inside of a movie theater

Consumer broadband sales were up in the quarter. Image source: Getty Images.

Consolidated's business providing fiber connections to wireless carriers increased 4% year over year, and consumer broadband grew 2% compared to a year prior.

The company eliminated its dividend in April, saying the money is better used deleveraging the business. CEO Bob Udell said that Consolidated reduced its total debt by $26 million in the quarter. Total net debt at the end of the quarter was $2.3 billion, or 4.39 times the company's last 12-month adjusted EBITDA.

"We are intensely focused on achieving our deleveraging goal of less than 4.0x net debt to adjusted EBITDA in advance of refinancing our unsecured debt by mid-2021," Udell said.

Now what

Consolidated Communications eliminated its dividend to reduce debt and fund its investment in fiber connections. Moving away from the ranks of dividend stocks might be the best use of the company's resources, but the move changed the profile of the stock and likely made the company less appealing to certain types of investors.

CNSL Chart

CNSL data by YCharts

Consolidated shares are still down big for the year. Thursday's jump is a good start, but this company remains a work in progress.