PRESIDENT AND MANAGER’S REPORT

Making Connections

JEREMY BECKER General Manager/CEO

WELCOME TO OUR 72ND ANNUAL MEETING!

The Annual Meeting is one of the highlights of our year—a chance to interact with our valued members and owners and celebrate our accomplishments. We are honored to share with you today our annual report from 2022.

YOU’RE LIVING IN A SMART RURAL COMMUNITY

NCC is proud to be certified as a Smart Rural Provider by NTCA - The Rural Broadband Association—making the communities in our service area Smart Rural Communities! It’s an important designation we share with 100+ other Smart Rural Providers across the country who share our mission to bring fiber internet and other cutting-edge communications services to small-town America.

Here are just a few ways Smart Rural Communities like ours are building a brighter future:

• Enabling telehealth in rural areas, which have 25% fewer local physicians than urban areas

• Opening the door to telework, which can save workers an average of $2,500-4,000 in travel costs per year

Working together with community leaders and local businesses, we’re helping to grow the towns we serve and create opportunities that help our neighbors thrive.

Did you know?

Rural North Dakotans are more likely to have access to fiber broadband and Gigabit speeds than rural Americans in other states.*

*According to a 2020 report by the Institute for Local Self Reliance (ILSR)

A New Addition To The Ncc Community

In September of 2022, NCC signed a letter of intent to purchase the assets of the Portal Exchange. On April 3, 2023, this transaction became official, and NCC began serving Portal customers with communication services previously offered by RTC Networks. The Portal acquisition brought nearly 50 internet subscribers and roughly 90 landlines to the NCC network. We are excited to welcome the Portal Community to the NCC family!

As you know, NCC completed its fiber build out in 2020, which allows us to bring reliable and scalable high-speed broadband to all of our members. Although Portal has approximately one-third of the community already served with fiber, the existing two-thirds will be no exception to the rule, as NCC has committed to overbuild the remaining copper infrastructure with fiber. NCC has been awarded an ARPA Grant to help complete the Portal Fiber Project. We are hopeful to begin placing fiber during this year’s construction season, with work ending by the fall of 2024.

Internet You Can Depend On

Reliable high-speed internet plays an essential role in how we work, learn, communicate, and live our everyday lives. Year after year, demand increases for internet service as our dependency on this essential technology continues to grow. In 2022, a study by Deloitte* found that the average number of entertainment and smart devices per home was 22.

Here at NCC, we live by the mantra, “our members depend on it.” For this reason, we are continuously monitoring and improving our network to meet ever-growing demand for broadband internet. We have been working to upgrade in-home electronics, increasing the capacity of our transport rings as well as adding another layer of redundancy with an additional internet route to the world wide web. These changes enhance network capacity and reliability.

• Almost 60% of NCC Internet subscribers has 5 to 14 devices in their home with (31) being the highest number of devices connected in a home with NCC Internent service.

• Greatest amount of bandwidth being consumed by a residential customer is 2.7 TB in a month timeframe.

Did you know?

Did you know that more than 98% (and growing) homes & businesses in NCC’s service area are eligible for Gigabit speeds?

Keeping You Safe Online

Along with an increase in internet demand comes an increase in cybersecurity concerns. Cybersecurity education and best practices are a regular curriculum amongst NCC employees and Directors.

In fact, we’d like to share three simple cybersecurity practices that can keep you and your family safer online:

1. Use strong passwords with a large character count and a mix Of numeric digits, upper/lowercase letters, and special characters. Remember: NEVER reuse your passwords!

2. When in doubt, don’t click links or share personal information without first verifying the source is legitimate.

3. Use the myNCC Connect app for built-in protection against viruses and malware, and to manage your network and set parental control guidelines.

Our myNCC Connect app provides not only an added layer of protection against viruses, phishing and malware, but also allows users to monitor and manage devices connected to their home internet and the content available on these devices, providing a safer online experience for children. If you would like to learn more about this app, please stop by our booth, call our office, or visit us online at nccray.com

Another Healthy Year

As noted on the financial statements included within this booklet, NCC enjoyed another successful year of growth. We saw a slight increase in our Net Operating Margin over 2021, lowered our LongTerm Debt by nearly $2 million, and posted a $3.6 million Net Margin.

Committed To Our Community

NCC strives to support the communities we serve through donations, sponsorships, scholarships, and volunteering. In 2022, NCC gave over $70,000 back to the communities we serve.

Our Sincere Thanks

We have many reasons to celebrate this year—all thanks to our dedicated employees and loyal members. I would like to personally express my gratitude to our employees for everything they do to provide a reliable and memorable experience to our membership.

And on behalf of all NCC employees and the Board of Directors, we thank you, valued members, for your continued support.

Until we meet again, we wish you health, happiness, and a wonderful year ahead.