centennial communications -...

Our Vision:To be the premier regional provider of telecommunications services,by tailoring the ultimate customer experience, in the markets we serve.

Centennial Communications2004 Financial Report

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Selected Five-Year Financial HighlightsFor theYear Ended May 31 (dollars in thousands, except for subscriber data)

2004 2003 2002 2001 2000

CONSOLIDATED RESULTS

Revenue 828,841 749,436 718,577 636,008 548,775

Net (loss) income (22,792) (111,646) (79,638) 183,099 17,885

Net (loss) income per share (0.23) (1.17) (0.84) 1.93 0.19

Adjusted Operating Income* 330,516 297,078 248,885 255,850 238,713

Capital Expenditures 132,930 133,109 214,442 222,904 148,552

Total Debt Less Cash Equivalents 1,655,762 1,691,579 1,774,646 1,668,096 1,571,066

U.S. WIRELESS

Revenue 370,200 355,629 350,724 363,750 349,330

Adjusted Operating Income 149,488 161,122 147,667 152,401 152,917

Subscribers 555,000 538,500 538,500 500,100 445,300

Net Gain - Subscribers 16,500 - 38,400 54,800 124,700

Postpaid Churn 1.9% 2.0% 2.2% 2.2% 2.0%

Penetration 9.1% 8.8% 8.8% 8.4% 7.2%

Monthly revenue per average customer 56 55 56 64 77

Roaming Revenue 54,303 77,632 92,584


CARIBBEAN WIRELESS

Revenue 306,212 262,052 236,339 193,004 162,011


Subscribers 496,200 398,600 366,500 263,000 181,500

Net Gain - Subscribers 97,600 103,500 81,500 48,000

Postpaid Churn 2.4% 2.7% 2.6% 2.8% 4.5%

Monthly revenue per average customer 57 58 62 74 86


CARIBBEAN BROADBAND

Revenue 164,735 141,757 139,144 86,017 45,069



Total Access Lines & Equivalents 264,100 222,400 190,200 132,900 48,300

Cable TV Subscribers 73,400 78,200 91,600 93,500 -

(dollars in millions)Revenue

(in thousands)Subscribers and Lines

(dollars in millions)Adjusted Operating Income

(dollars in millions)Capital Expenditures

U.S. Wireless Caribbean Wireless Caribbean Broadband

114,790 108,884

*See Investor Relations section of Centennials Website at www.centennialwireless.com for a discussion of Non-GAAP financial measures.**Includes a reduction of 30,200 subscribers in the twelve months ended May 2003 from the divested Centennial Digital Jamaica operations.

All of these subscribers were added in the twelve months ended May 31, 2002.

32,100 **

Dear Shareholders,

Fiscal 2004 was a year of significantaccomplishment and gratifying finan-cial results for Centennial Communica-tions. Even better, at the start of fiscal2005, we see a wealth of opportunitiesto establish Centennial Communica-tions even more firmly as the premierregional telecommunications providerin the markets we serve. Centennialsability to de-leverage consistently whilegrowing adjusted operating income(AOI)* is the foundation for substan-tial value creation over time.

Financial Results

Centennials financial performanceduring fiscal 2004 reflected thecompanys fundamental strengths.

Double digit growth. Revenueincreased 11% to $829 million and AOIincreased 11% to $331 million in fiscal2004. This impressive double-digitgrowth was achieved even thoughroaming revenues fell 29%. Roamingrevenue accounted for less than 7% of2004 consolidated revenue.Impressive margins. All businesssegments reported significant margins:U.S. Wireless retail operation, 32%;

Caribbean Broadband, 36%; Carib-bean Wireless, 40%.Efficient Use of Capital. Capitalexpenditures of $133 million (or only16% of revenue) supported our growthand profitability.Impressive returns. Free cash flow(AOI less capital expenditures)reached a record $198 million for fiscal2004, up from $164 million in fiscal2003, with contributions from Carib-bean Wireless and Caribbean Broad-band now approaching that of U.S.Wireless.Enhanced financial flexibility. Weconsummated refinancing transactionsof approximately $1.6 billion during theyear, extending maturities, reducingamortization and affording Centennialenhanced financial flexibility for thelong term. By year-end, the ratio ofnet debt to AOI was at 5 times,compared to 5.7 times at the end offiscal 2003.

Strategic and OperatingAccomplishments

Announced a definitive agreement tosell our Cable Television operation tothe private equity firm of Hick Musefor $155 million in cash, a transactionthat will accelerate our de-leveragingand sharpen our strategic focus.Completed a GSM overlay in ourMidwest Cluster and began in ourSoutheast Cluster.Announced the exercise of optionsto purchase spectrum from AT&TWireless covering approximately 4.1million POPs contiguous to our exist-ing footprint in Michigan and Indiana.The aggregate exercise price of thespectrum is $19.5 million. We alsoannounced a definitive agreement tosell the Indianapolis and Lafayette,Indiana portion of this spectrum to

cash. If consummated, the net resultof these transactions will be thatCentennial will obtain licenses cover-ing approximately 2.2 million incre-mental POPs, and receive $4.5 milli-on of cash.Announced a $45 million plan, con-tingent on the spectrum purchase,to launch service in a 1.4 million POParea that includes Grand Rapids andLansing, Michigan. This new buildbridges a gap in our Midwest clusterand meaningfully strengthens thecompetitiveness of U.S. Wireless.Installed a new and expanded CDMA1X network in the Dominican Repub-lic and greatly expanded the capacityand coverage of our Puerto Ricowireless network.Expanded and refurbished our retailsales and service locations in PuertoRico and the Dominican Republic.Continued to increase the value ofthe Centennial brand in all ourmarkets, as indicated by our customerresearch.

Building Our Brand

Centennials vision is to be the premierregional provider of telecommunica-tions services by tailoring the ulti-mate customer experience in themarkets we serve. We build our brandin support of this vision in all our servingareas, tailoring the implementation to theneeds of each area. Our ability to tailorby geography is an advantage of ourbeing a regional service provider.

Increasingly, brand is a competitivedifferentiator in the telecommunica-tions industry. Although the concept ofbrand is well accepted in many indus-tries, it is relatively new to the tele-communications industry with itsmonopoly franchise heritage. Today,few vestiges of monopoly remain inthe telecommunications industry,particularly in the intensely competitivewireless segment. This rapidly esca-

*See Investor Relations section of CentennialsWebsite at www.centennialwireless.com for adiscussion of Non-GAAP financial measures.

During or after fiscal 2004, we madeprogress on many fronts. We:

Verizon Wireless for $24 million in

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lating competition drives the need tobuild a brand.

Brand building happens customer bycustomer and associate by associate.The ultimate customer experience,whether based on trust or respect,depends on millions of great interac-tions between our associates and ourcustomers. Our team of 3,600 Cen-tennial associates who deliver thisexperience to our customers is gettingbetter every day.

Our understanding of our customerneeds and our ability to improve howwe respond to those needs alsoimproves every day. Our visionmotivates our world-class team ofcustomer-focused associates.In U.S. Wireless, the attributecustomers attach to Centennial istrust. We have the Blue Shirt Prom-ises. We are Trusted Advisors. Wedesign processes to prevent surpriseson customer bills.In the Caribbean, a historicallyunderserved region, the attributecustomers attach to Centennial isrespect. Customers think we treatthem right. We listen. We care. Weeven welcome customers to our storesto pay their bills, which may soundobvious, but some of our competitorsview this as an inconvenience andcharge for in person payments.

Building brand is working for you, ourshareholders. Consider the results.We have successfully reduced ourdependence on roaming revenue byrapidly growing our retail or end-userrevenues and profitability.

Over the past six years, non-roamingAOI has grown at a compound annual

leveraged recapitalization of theCompany.

In fiscal 2004, the non-roaming AOI

roaming revenue growth of $103million or 15%. The non-roamingrevenue growth of $103 million wasalmost double our U.S. Wirelessroaming revenue of $54 million.

The Future

We believe a balance of internalgrowth and de-leveraging creates thebest risk-adjusted return for Centennialshareholders. In the future, continuedinvestment in our brand will grow ournon-roaming revenue and AOI, whileroaming revenue will become increas-ingly less relevant for Centennial.

We now have the spectrum andfootprint to sustain long-term growth inour U.S. Wireless operation. Our

planned Grand Rapids/Lansing newbuild will improve our footprint com-petitiveness and expands our U.S.Wireless covered POPs by 23% and

In the future, we also expect that:

Introductions of new wireless dataservices will leverage the recentoverlay of GSM in U.S. Wirelessand the existing CDMA 1X in theCaribbean.Network expansions in the Carib-bean will improve in building cover-age, the new frontier forwireless.The integration of our wireless andwireline assets in the Caribbean willcreate advantages that few of ourcompetitors can match.Continuous learning (supported byCentennial University and otherinitiatives) and the willingness toembrace change by Centennialassociates will be the foundationfor tailoring the ultimate customerexperience.

As we look back at this stellar yearand look forward to fiscal 2005, I wantto express my gratitude to Centennialsassociates, vendors and investors.Your efforts and support made 2004 aresounding success and pave the wayfor a promising future as the premierregional provider of telecommunica-tions services in the markets we serve.

Michael J. SmallSeptember 2004

Retail AOICompound Annual Growth:

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36%

grew $57 million or 26% on non-

In fiscal 2004, the AOI margin onthe incremental retail revenue growthwas 56% and U.S. Wireless (ourincorrectly perceived low growthbusiness) grew its non-roaming AOI to$101 million from $89 million the prioryear, an increase of 13%.

our licensed POPs by 37%.

growth rate of over 36% since the

U. S. Wireless Operations

Corporate Profile

Caribbean Operations

U.S. WirelessU.S. Wireless operations serve marketswith approximately six million people intwo clusters. One cluster includesIndiana, Michigan and Ohio; the otherincludes Louisiana, Mississippi andTexas. Our clusters are comprised ofsmall cities and rural areas that generallyhave lower penetration levels than majormetropolitan areas. Approximately 94percent of U.S. Wireless 555,000wireless customers have digital phonesand use its TDMA (Time DivisionMultiple Access) network. We launchedGSM service in the Midwest cluster inNovember 2003 and expect to launchGSM service in the Southeast clusterby the end of calendar 2004. U.S.Wireless network encompasses over767 cell sites and its extensivedistribution channels include 110company-owned retail locations.

Caribbean Region

Dominican Republic

Puerto Rico San Juan

Santo Domingo

U. S. Virgin Islands

Santiago

Ponce

Chicago

Indianapolis

Cincinnati

Columbus

Lansing

Detroit

OHIO

INDIANA

MICHIGANGrand Rapids

Centennial Service Areas

1.4 M POPs To Be Built

0.9 M POPs For ReserveShreveport

Jackson

Houston

TEXAS

MISSISSIPPI

New Orleans

Baton RougeBaton Rouge

Centennial Communications Corp.,founded in 1988, is a leading regionalwireless and broadband tele-communications company serving overone million customers in markets with acombined population of 19.5 million inthe United States and the neighboringCaribbean. On May 31, 2004,Centennial had 1,051,200 wirelesscustomers, 73,400 cable TV subscribers,and provided 264,100 lines of voice, dataand Internet services.

In the United States, Centennial is aregional wireless service provider insmall cities and rural areas in twogeographic clusters covering parts of sixstates. In our Puerto Rico based Caribbeanservice area, Centennial is a facilitiesbased, fully-integrated communicationsservice provider offering both wirelessand broadband voice, data, Internet andvideo services to businesses andconsumers.

Centennials Caribbean operationsoffer service to a population ofapproximately 13 million people inPuerto Rico, the Dominican Republicand the U.S. Virgin Islands using digitalwireless and terrestrial broadbandtelecommunications technologies.Centennial uses CDMA digital wirelesstechnology that is upgraded for high-speed data in all of its markets in theCaribbean. The company has 1,730fiber-optic terrestrial route miles and3,150 miles of coaxial cables installedin the Caribbean. These Caribbeanwireless and wireline networks areconnected by Centennials underseafiber optic capacity to the companysswitch in Miami. This shared, all digitalnetwork supporting voice, data, Internetand video creates substantialeconomies of scale and allows thecompany to efficiently serve high-usage customers. As of May 31, 2004,Centennials approximately 2,500employees in the Caribbean werededicated to providing superior serviceto 496,200 wireless customers, 73,400cable TV subscribers, and more than23,000 Internet and telephonycustomers using 264,100 lines of voice,data and Internet services.

Welsh, Carson, Anderson & Stoweand an affiliate of The BlackstoneGroup are controlling shareholders ofCentennial. Approximately twentypercent of Centennials common stockis publicly traded on Nasdaq underthe symbol CYCL.

Directors

Anthony J. de NicolaGeneral PartnerWelsh, Carson, Anderson & Stowe

James R. MatthewsGeneral PartnerWelsh, Carson, Anderson & Stowe

Thomas E. McInerneyChairman of the BoardCentennialGeneral PartnerWelsh, Carson, Anderson & Stowe

James P. PellowExecutive Vice President andChief Operating OfficerSt. Johns University

Raymond A. RanelliPricewaterhouseCoopers, Retired

Robert D. ReidPrincipalThe Blackstone Group

Michael J. SmallChief Executive OfficerCentennial

David M. TolleyPrincipalThe Blackstone Group

J. Stephen VanderwoudeChairman & Chief Executive OfficerMadison River Communications

Officers and Management

Michael J. SmallChief Executive Officer

Thomas J. FitzpatrickChief Financial Officer

Thomas E. BucksChief Accounting Officer

Tony L. WolkSenior Vice President, General Counsel

Nancy D. WernerVice President, Human Resources

U.S. Wireless

Phillip H. MayberryPresident

Laura J. HughesVice President, Marketing

Donald J. KincaidVice President, Customer Service

Jeffrey L. ShivelySenior Vice President, Engineering

Caribbean Operations

John A. de ArmasPresident

Thomas R. Cogar, Jr.Chief Technology Officer

Juan C. VictoriaChief Information Officer

Raul SalvadoPresident, Dominican Republic

Charles M. Hollis Senior Vice President, Wireless Operations

Alvaro PilarVice President, Broadband

Francis P. HuntVice President, Controller

CORPORATE INFORMATION

3349 Route 138 Wall Township, NJ 07719 (732) 556-2200

Annual MeetingThe Annual Meeting of Shareholders will beheld at 11 a.m., Eastern Standard Time, onThursday, September 30, 2004:

The Waldorf=Astoria301 Park AvenueSutton SuiteNew York, NY 10022

Investor Information and 10-KTo request additional copies of theCompanys Annual Report on Form 10-Kor to obtain other investor information,contact:

Thomas J. FitzpatrickChief Financial Officer

3349 Route 138Wall Township, NJ 07719(732) 556-2220

www.centennialwireless.comwww.centennialpr.comwww.centennialrd.com

Stock Exchange ListingThe Nasdaq Stock MarketTicker Symbol: CYCL

Transfer Agent and RegistrarAmerican Stock Transferand Trust Company59 Maiden LaneNew York, NY 10038(212) 936-5100

Independent AuditorsDeloitte & Touche LLP

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