Exhibit 99.1
August 4, 2010
John Lowber, (907) 868-5628; jlowber@gci.com
Bruce Broquet, (907) 868-6660; bbroquet@gci.com
David Morris, (907) 265-5396; dmorris@gci.com
FOR IMMEDIATE RELEASE
GCI REPORTS SECOND QUARTER 2010 FINANCIAL RESULTS
· | Consolidated revenue of $162.3 million |
· | Adjusted EBITDA of $57.4 million |
· | Net income of $1.9 million or $0.04 per diluted share |
ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its second quarter 2010 results with revenues increasing to $162.3 million and adjusted EBITDA increasing to $57.4 million.
“Five years ago GCI was reselling another provider’s wireless products and had only 12,000 customers,” said GCI president Ron Duncan. “Since then we have diligently built the only statewide wireless network and customers have responded in droves. In those five years we have welcomed 120,000 new customers growing our base ten fold. While we were a little late to build our own network we worked aggressively to create the best statewide wireless system and are proud to acknowledge that Alaskans have rewarded GCI by making us the second largest wireless company in the state.”
“GCI’s wireless results have been a leading indicator of our financial performance for several quarters and this move to second place in wireless fits nicely with announcing yet another record high quarter of revenues and EBITDA. I couldn’t be more pleased with our performance and I’d like to thank the customers, contractors and employees who have made it possible. Watch out number one, here we come!”
Revenues for the second quarter of 2010 increased 9.1 percent over revenues of $148.8 million in the second quarter of 2009. Adjusted EBITDA increased $6.1 million or 11.9 percent over the second quarter of 2009 EBITDA of $51.2 million. The increase in revenues and EBITDA was partly due to a $4.7 million change in the estimate of the amount due to GCI under the USF high-cost area program, offset by a $1.7 million reserve adjustment for amounts receivable under a contract with a large customer. The USF estimate change impacted the consumer and commercial segments. The contract reserve adjustment was attributed to the managed broadband segment.
GCI’s second quarter 2010 net income totaled $1.9 million or earnings per diluted share of $0.04 and compares to net income of $2.6 million, or earnings per diluted share of $0.05 for the same period of 2009.
Second quarter 2010 revenues increased $9.9 million or 6.5 percent over total revenues of $152.4 million in the first quarter of 2010. Adjusted EBITDA increased $6.3 million or 12.3 percent over adjusted EBITDA of $51.1 million in the first quarter of 2010. The sequential increase in revenues and EBITDA was favorably impacted by the aforementioned adjustments.
“GCI anticipated revenues of $610 million to $620 million and adjusted EBITDA of $200 to $204 million for the year 2010.” said Duncan. “The company's practice is to provide guidance only on an annual basis, however our continued success in the consumer business, improvements in the commercial business and stabilizing trends in the network access business lead us to conclude that GCI is likely to slightly
exceed its guidance for the year.”
“Alaska’s economy continues to perform well when benchmarked against the rest of the country. Alaska jobs are growing again and energy prices appear to be stabilizing at levels that will support the state’s operating budget.”
Highlights
· | GCI became the second largest wireless provider in Alaska with the addition of 3,100 wireless subscribers in the second quarter of 2010. Wireless subscribers totaled 131,200 at the end of the quarter. |
· | Consumer revenues for the second quarter of 2010 totaled $87.1 million, an increase of 18.7 percent over the second quarter of 2009 and an increase of 8.4 percent over the first quarter of 2010. Revenue increases were strong for all consumer products and services. |
· | GCI had 145,400 access lines at the end of the second quarter of 2010, representing an estimated 35 percent share of the total access line market in Alaska. Access lines decreased by 1,300 lines from the first quarter of 2010. |
· | GCI’s facilities-based access lines totaled 109,700, representing 75 percent of its total access lines at the end of the second quarter of 2010, a decrease of 200 lines from the first quarter of 2010 and an increase of 8,000 lines when compared to the end of the second quarter of the prior year. |
· | GCI had 114,300 consumer and commercial cable modem customers at the end of the second quarter of 2010, an increase of 700 over the 113,600 cable modem customers at the end of the first quarter 2010. Average monthly revenue per cable modem totaled $46.69 for the second quarter of 2010 as compared to $42.19 in the prior year, an increase of 10.7 percent and is up 1.8 percent over $45.85 for the first quarter of 2010. |
· | GCI had 151,500 basic video subscribers at the end of the second quarter of 2010, a decrease of 200 from the second quarter of 2009 and an increase of 2,300 over the first quarter of 2010. |
· | GCI repurchased 171,300 shares of its Class A common shares at a cost of approximately $1.0 million or $5.86 per share during the second quarter of 2010. Depending on company performance, market conditions, liquidity, and subject to board oversight GCI may continue repurchasing its own shares. |
Consumer
Consumer revenues increased 18.7 percent to $87.1 million as compared to $73.4 million in the second quarter of 2009 and increased 8.4 percent over $80.4 million in the first quarter of 2010. Revenue increases were strong for all consumer products and services. Consumer revenues were favorably impacted by a $4.1 million USF estimate change during the second quarter of 2010 which compares to an increase in USF revenues of $2.4 million in the second quarter of 2009 that were attributed to prior quarters.
Consumer voice revenues of $15.3 million increased 17.4 percent when compared to the second quarter a year ago and were up 10.1 percent over the first quarter of 2010. Consumer voice revenues were favorably impacted by $1.2 million of the total $4.1 million USF estimate change. Consumer local access lines in service at the end of second quarter of 2010 totaled 85,100, an increase of 3,900 lines over the
second quarter of 2009. Total access lines decreased by 700 lines when compared to the first quarter of 2010.
GCI serves 77,100 consumer access lines on its own facilities, an increase of 6,800 lines over the second quarter of 2009. More than 90 percent of consumer access lines are provisioned exclusively on GCI facilities.
Consumer video revenues of $29.4 million increased 8.2 percent over the prior year and increased 1.1 percent over the first quarter of 2010. The increases are due in part to increases in video subscribers purchasing higher tiered services and renting high definition/digital video recorder converters. Consumer video subscribers totaled 131,200 at the end of the second quarter of 2010, an increase of 1,500 subscribers over the second quarter of 2009 and a decrease of 200 subscribers from the first quarter of 2010.
Consumer data revenues of $14.6 million increased 20.1 percent over the prior year and 3.4 percent over the first quarter of 2010. The increase in consumer data revenues is due to an increase in cable modem customers and increasing average monthly revenue per cable modem. GCI added 8,600 consumer cable modem customers over the prior year and cable modem customer counts increased by 400 on a sequential basis.
Consumer wireless revenues increased to $27.9 million, an increase of 32.3 percent over the second quarter of 2009. The increase in wireless revenues is due in part to an increase in wireless subscribers and a $2.9 million USF estimate change. Consumer has added 15,400 wireless customers over the end of the second quarter a year ago, an increase of 14.9 percent. Consumer wireless revenues increased $4.6 million sequentially, an increase of 19.6 percent, over the first quarter of 2010. Consumer added 1,500 wireless customers as compared to the end of the first quarter of 2010.
Network Access
Network access revenues decreased 12.9 percent to $27.1 million as compared to $31.1 million in the second quarter of 2009 and increased 3.5 percent over the first quarter of 2010.
Voice revenues, as expected, decreased 46.6 percent from the prior year and increased 7.8 percent from the first quarter of 2010. The decrease in voice revenues is primarily due to decreasing average revenue per minute and the transition of voice traffic to dedicated networks. The declining revenue per minute is largely due to renegotiating long-term contracts with our largest carriers during 2009.
Data revenues were down 1.6 percent compared to the second quarter 2009 and decreased 3.1 percent from the first quarter of 2010. The decrease in data revenues is primarily attributable to lower rates resulting from increased competition. The lower rates were partially offset by increases in data network capacity purchased by common carrier customers.
Wireless revenues, primarily related to roaming traffic, increased $2.5 million over the prior year and increased $0.9 million sequentially.
Commercial
Commercial revenues for the second quarter increased $5.2 million, an increase of 19.2 percent, to $32.1 million as compared to $26.9 million in the second quarter of 2009 and increased $4.3 million over $27.7 million in the first quarter of 2010. Commercial revenues were favorably impacted by a $0.6 million USF estimate change during the second quarter of 2010.
Voice revenues increased 9.7 percent over the prior year and 7.7 percent sequentially. The increase in voice revenues was due in part to $0.4 million of the total $0.6 million USF estimate change. Long distance minutes decreased 7.3 percent from the prior year and 0.4 percent from the first quarter of 2010. Commercial local access lines increased by 700 over the second quarter of 2009 and decreased 400 lines sequentially.
Commercial video revenues increased $0.4 million over the prior year and $0.3 million sequentially.
Commercial data services revenues include both transmission charges for data circuits and time and materials charges for GCI on-site support of customer operations. Data transport charges of $8.9 million were steady as compared to the second quarter of 2009 while time and material charges for support activities increased by $3.1 million to $10.0 million for the second quarter of 2010 as a result of increased activity primarily in the state’s oil sector. Commercial data service revenues were $18.8 million in the second quarter of 2010, up $3.4 million from the second quarter of 2009 and $3.3 million from the first quarter of 2010.
Commercial wireless revenues totaled $2.2 million for the second quarter, an increase of 36.3 percent over the prior year and an increase of 4.5 percent over the first quarter of 2010. Wireless revenues were also favorably impacted by a $0.2 million USF estimate change during the second quarter of 2010. GCI had 12,200 commercial wireless subscribers at the end of the second quarter, an increase of 1,600 subscribers over the first quarter of 2010.
Managed Broadband
Managed broadband revenues totaled $10.4 million in the second quarter of 2010, a decrease of 5.6 percent from $11.0 million in the second quarter of 2009. Revenue for the second quarter was down 14.1 percent from $12.1 million reported in the first quarter of 2010. The decrease in revenues is attributable to a $1.7 million reserve adjustment due to an adverse regulatory decision regarding services provided to a customer.
Regulated Operations
Regulated operations revenues totaled $5.6 million in the second quarter of 2010 as compared to $6.4 million in the second quarter of 2009. Regulated operations revenues for the second quarter of 2010 decreased $0.5 million from the first quarter of 2010. Regulated operations has 10,600 local access lines at the end of the second quarter of 2010, a decrease of 200 access lines from the first quarter of 2010.
Other Items
GCI’s second quarter 2010 capital expenditures totaled $27.1 million as compared to $29.7 million in the second quarter of 2009 and $16.8 million in the first quarter of 2010.
GCI will hold a conference call to discuss the quarter’s results on Thursday, August 5, 2010 beginning at 2 p.m. (Eastern). To access the briefing on August 5, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-829-8669 (International callers should dial 1-630-395-0367) and identify your call as “GCI.” In addition to the conference call, GCI will make available net conferencing. To access the call via net conference, log on to www.gci.com and follow the instructions. A replay of the call will be available for 72-hours by dialing 866-453-2036, access code 7461 (International callers should dial 203-369-1225.)
GCI is the largest telecommunications company in Alaska. GCI’s cable plant, which provides voice, video, and broadband data services, passes 90 percent of Alaska households. GCI operates Alaska’s most extensive terrestrial / subsea fiber optic network which connects not only Anchorage but also Fairbanks, and Juneau / Southeast Alaska to the lower 48 states with a diversely routed, protected fiber network. GCI’s satellite network provides communications services to small towns and communities throughout rural Alaska. GCI’s newly constructed statewide mobile wireless network seamlessly links urban and rural Alaska for the first time in the state’s history.
A pioneer in bundled services, GCI is the top provider of voice, data, and video services to Alaska consumers with a 70 percent share of the consumer broadband market. GCI is also the leading provider of communications services to enterprise customers, particularly large enterprise customers with complex data networking needs. More information about GCI can be found at www.gci.com.
The foregoing contains forward-looking statements regarding GCI’s expected results that are based on management’s expectations as well as on a number of assumptions concerning future events. Actual results might differ materially from those projected in the forward looking statements due to uncertainties and other factors, many of which are outside GCI’s control. Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements is contained in GCI’s cautionary statement sections of Form 10-K and 10-Q filed with the Securities and Exchange Commission.
# # #
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(Unaudited) | ||||||||
(Amounts in thousands) | ||||||||
June 30, | December 31, | |||||||
Assets | 2010 | 2009 | ||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 66,595 | 48,776 | |||||
Receivables | 157,670 | 147,859 | ||||||
Less allowance for doubtful receivables | 11,144 | 7,060 | ||||||
Net receivables | 146,526 | 140,799 | ||||||
Deferred income taxes | 17,618 | 17,618 | ||||||
Prepaid expenses | 7,394 | 4,491 | ||||||
Inventories | 5,656 | 9,278 | ||||||
Other current assets | 5,592 | 5,872 | ||||||
Total current assets | 249,381 | 226,834 | ||||||
Property and equipment in service, net of depreciation | 801,019 | 823,080 | ||||||
Construction in progress | 33,046 | 26,161 | ||||||
Net property and equipment | 834,065 | 849,241 | ||||||
Cable certificates | 191,635 | 191,565 | ||||||
Goodwill | 73,452 | 73,452 | ||||||
Wireless licenses | 25,967 | 25,967 | ||||||
Other intangible assets, net of amortization | 17,670 | 19,561 | ||||||
Deferred loan and senior notes costs, net of amortization | 14,528 | 13,168 | ||||||
Other assets | 17,787 | 18,609 | ||||||
Total other assets | 341,039 | 342,322 | ||||||
Total assets | $ | 1,424,485 | 1,418,397 | |||||
(Continued) |
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(Unaudited) | ||||||||
(Continued) | ||||||||
(Amounts in thousands) | ||||||||
June 30, | December 31, | |||||||
Liabilities and Stockholders' Equity | 2010 | 2009 | ||||||
Current liabilities: | ||||||||
Current maturities of obligations under long-term debt and capital leases | $ | 10,302 | 9,892 | |||||
Accounts payable | 32,811 | 30,697 | ||||||
Deferred revenue | 22,444 | 21,404 | ||||||
Accrued payroll and payroll related obligations | 19,149 | 21,874 | ||||||
Accrued interest | 13,428 | 14,821 | ||||||
Accrued liabilities | 12,964 | 15,037 | ||||||
Subscriber deposits | 1,358 | 1,549 | ||||||
Total current liabilities | 112,456 | 115,274 | ||||||
Long-term debt, net | 773,292 | 771,247 | ||||||
Obligations under capital leases, excluding current maturities | 86,752 | 89,279 | ||||||
Obligation under capital lease due to related party | 1,880 | 1,876 | ||||||
Deferred income taxes | 105,686 | 100,386 | ||||||
Long-term deferred revenue | 51,060 | 52,342 | ||||||
Other liabilities | 22,351 | 21,676 | ||||||
Total liabilities | 1,153,477 | 1,152,080 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Common stock (no par): | ||||||||
Class A. Authorized 100,000 shares; issued 51,978 and 51,899 shares at June 30, 2010 and December 31, 2009, respectively; outstanding 51,485 and 51,627 shares at June 30, 2010 and December 31, 2009, respectively | 149,450 | 150,911 | ||||||
Class B. Authorized 10,000 shares; issued and outstanding 3,185 and 3,186 shares at June 30, 2010 and December 31, 2009, respectively; convertible on a share-per-share basis into Class A common stock | 2,683 | 2,684 | ||||||
Less cost of 493 and 272 Class A common shares held in treasury at June 30, 2010 and December 31, 2009, respectively | (2,328 | ) | (2,339 | ) | ||||
Paid-in capital | 34,254 | 30,410 | ||||||
Retained earnings | 86,949 | 84,651 | ||||||
Total stockholders' equity | 271,008 | 266,317 | ||||||
Total liabilities and stockholders' equity | $ | 1,424,485 | 1,418,397 |
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||||||||||
CONSOLIDATED INCOME STATEMENT | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(Amounts in thousands, except per share amounts) | 2010 | 2009 | 2010 | 2009 | ||||||||||||
Revenues | $ | 162,326 | 148,796 | 314,745 | 297,485 | |||||||||||
Cost of goods sold (exclusive of depreciation and amortization shown separately below) | 51,754 | 47,348 | 100,661 | 95,205 | ||||||||||||
Selling, general and administrative expenses | 54,704 | 51,719 | 107,961 | 108,305 | ||||||||||||
Depreciation and amortization expense | 30,820 | 31,170 | 61,946 | 61,904 | ||||||||||||
Operating income | 25,048 | 18,559 | 44,177 | 32,071 | ||||||||||||
Other income (expense): | ||||||||||||||||
Interest expense (including amortization of deferred loan fees) | (17,729 | ) | (13,273 | ) | (35,409 | ) | (25,920 | ) | ||||||||
Interest income | 76 | 11 | 137 | 19 | ||||||||||||
Other expense, net | (17,653 | ) | (13,262 | ) | (35,272 | ) | (25,901 | ) | ||||||||
Income before income tax expense | 7,395 | 5,297 | 8,905 | 6,170 | ||||||||||||
Income tax expense | 5,465 | 2,733 | 5,301 | 3,252 | ||||||||||||
Net income | $ | 1,930 | 2,564 | 3,604 | 2,918 | |||||||||||
Basic net income per Class A common share | $ | 0.04 | 0.05 | 0.07 | 0.06 | |||||||||||
Basic net income per Class B common share | $ | 0.04 | 0.05 | 0.07 | 0.06 | |||||||||||
Diluted net income per Class A common share | $ | 0.04 | 0.05 | 0.07 | 0.05 | |||||||||||
Diluted net income per Class B common share | $ | 0.04 | 0.05 | 0.07 | 0.05 | |||||||||||
Common shares used to calculate Class A basic EPS | 51,489 | 49,300 | 51,534 | 49,286 | ||||||||||||
Common shares used to calculate Class A diluted EPS | 54,745 | 52,906 | 54,786 | 53,101 |
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL SCHEDULES | ||||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||
Second Quarter 2010 | Second Quarter 2009 | |||||||||||||||||||||||||||||||||||||||||||||||
Network | Managed | Regulated | Network | Managed | Regulated | |||||||||||||||||||||||||||||||||||||||||||
Consumer | Access | Commercial | Broadband | Operations | Totals | Consumer | Access | Commercial | Broadband | Operations | Totals | |||||||||||||||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||||||||||
Voice | $ | 15,254 | 7,176 | 8,448 | - | 5,607 | 36,485 | $ | 12,988 | 13,444 | 7,701 | - | 6,368 | 40,501 | ||||||||||||||||||||||||||||||||||
Video | 29,352 | - | 2,639 | - | - | 31,991 | 27,132 | - | 2,221 | - | - | 29,353 | ||||||||||||||||||||||||||||||||||||
Data | 14,608 | 15,823 | 18,831 | 10,387 | - | 59,649 | 12,166 | 16,073 | 15,409 | 10,998 | - | 54,646 | ||||||||||||||||||||||||||||||||||||
Wireless | 27,935 | 4,113 | 2,153 | - | - | 34,201 | 21,113 | 1,603 | 1,580 | - | - | 24,296 | ||||||||||||||||||||||||||||||||||||
Total | 87,149 | 27,112 | 32,071 | 10,387 | 5,607 | 162,326 | 73,399 | 31,120 | 26,911 | 10,998 | 6,368 | 148,796 | ||||||||||||||||||||||||||||||||||||
Cost of goods sold | 26,192 | 6,379 | 15,097 | 3,160 | 926 | 51,754 | 24,011 | 6,556 | 12,977 | 2,357 | 1,447 | 47,348 | ||||||||||||||||||||||||||||||||||||
Contribution | 60,957 | 20,733 | 16,974 | 7,227 | 4,681 | 110,572 | 49,388 | 24,564 | 13,934 | 8,641 | 4,921 | 101,448 | ||||||||||||||||||||||||||||||||||||
Less SG&A | 30,445 | 7,897 | 9,179 | 4,219 | 2,964 | 54,704 | 27,740 | 9,370 | 8,600 | 3,411 | 2,598 | 51,719 | ||||||||||||||||||||||||||||||||||||
EBITDA | 30,512 | 12,836 | 7,795 | 3,008 | 1,717 | 55,868 | 21,648 | 15,194 | 5,334 | 5,230 | 2,323 | 49,729 | ||||||||||||||||||||||||||||||||||||
Add share-based compensation | 825 | 390 | 273 | 155 | - | 1,643 | 607 | 452 | 246 | 122 | - | 1,427 | ||||||||||||||||||||||||||||||||||||
Add (less) non-cash contribution adjustment | (82 | ) | (39 | ) | (24 | ) | (15 | ) | - | (160 | ) | 37 | 25 | 12 | 6 | - | 80 | |||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 31,255 | 13,187 | 8,044 | 3,148 | 1,717 | 57,351 | $ | 22,292 | 15,671 | 5,592 | 5,358 | 2,323 | 51,236 | ||||||||||||||||||||||||||||||||||
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL SCHEDULES | ||||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||
Second Quarter 2010 | First Quarter 2010 | |||||||||||||||||||||||||||||||||||||||||||||||
Network | Managed | Regulated | Network | Managed | Regulated | |||||||||||||||||||||||||||||||||||||||||||
Consumer | Access | Commercial | Broadband | Operations | Totals | Consumer | Access | Commercial | Broadband | Operations | Totals | |||||||||||||||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||||||||||
Voice | $ | 15,254 | 7,176 | 8,448 | - | 5,607 | 36,485 | $ | 13,856 | 6,659 | 7,843 | - | 6,060 | 34,418 | ||||||||||||||||||||||||||||||||||
Video | 29,352 | - | 2,639 | - | - | 31,991 | 29,024 | - | 2,317 | - | - | 31,341 | ||||||||||||||||||||||||||||||||||||
Data | 14,608 | 15,823 | 18,831 | 10,387 | - | 59,649 | 14,126 | 16,329 | 15,502 | 12,085 | - | 58,042 | ||||||||||||||||||||||||||||||||||||
Wireless | 27,935 | 4,113 | 2,153 | - | - | 34,201 | 23,362 | 3,195 | 2,061 | - | - | 28,618 | ||||||||||||||||||||||||||||||||||||
Total | 87,149 | 27,112 | 32,071 | 10,387 | 5,607 | 162,326 | 80,368 | 26,183 | 27,723 | 12,085 | 6,060 | 152,419 | ||||||||||||||||||||||||||||||||||||
Cost of goods sold | 26,192 | 6,379 | 15,097 | 3,160 | 926 | 51,754 | 25,633 | 6,528 | 12,371 | 3,218 | 1,157 | 48,907 | ||||||||||||||||||||||||||||||||||||
Contribution | 60,957 | 20,733 | 16,974 | 7,227 | 4,681 | 110,572 | 54,735 | 19,655 | 15,352 | 8,867 | 4,903 | 103,512 | ||||||||||||||||||||||||||||||||||||
Less SG&A | 30,445 | 7,897 | 9,179 | 4,219 | 2,964 | 54,704 | 29,166 | 7,844 | 9,144 | 4,043 | 3,060 | 53,257 | ||||||||||||||||||||||||||||||||||||
EBITDA | 30,512 | 12,836 | 7,795 | 3,008 | 1,717 | 55,868 | 25,569 | 11,811 | 6,208 | 4,824 | 1,843 | 50,255 | ||||||||||||||||||||||||||||||||||||
Add share-based compensation | 825 | 390 | 273 | 155 | - | 1,643 | 384 | 180 | 149 | 90 | - | 803 | ||||||||||||||||||||||||||||||||||||
Add non-cash contribution adjustment | (82 | ) | (39 | ) | (24 | ) | (15 | ) | - | (160 | ) | - | - | - | - | - | - | |||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 31,255 | 13,187 | 8,044 | 3,148 | 1,717 | 57,351 | $ | 25,953 | 11,991 | 6,357 | 4,914 | 1,843 | 51,058 | ||||||||||||||||||||||||||||||||||
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL SCHEDULES | ||||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2010 | Six Months Ended June 30, 2009 | |||||||||||||||||||||||||||||||||||||||||||||||
Network | Managed | Regulated | Network | Managed | Regulated | |||||||||||||||||||||||||||||||||||||||||||
Consumer | Access | Commercial | Broadband | Operations | Totals | Consumer | Access | Commercial | Broadband | Operations | Totals | |||||||||||||||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||||||||||||||||||
Voice | $ | 29,110 | 13,835 | 16,291 | - | 11,667 | 70,903 | $ | 26,903 | 27,778 | 15,685 | - | 12,537 | 82,903 | ||||||||||||||||||||||||||||||||||
Video | 58,376 | - | 4,956 | - | - | 63,332 | 54,502 | - | 4,271 | - | - | 58,773 | ||||||||||||||||||||||||||||||||||||
Data | 28,734 | 32,152 | 34,333 | 22,472 | - | 117,691 | 23,928 | 34,027 | 31,924 | 21,608 | - | 111,487 | ||||||||||||||||||||||||||||||||||||
Wireless | 51,297 | 7,308 | 4,214 | - | - | 62,819 | 38,785 | 2,514 | 3,023 | - | - | 44,322 | ||||||||||||||||||||||||||||||||||||
Total | 167,517 | 53,295 | 59,794 | 22,472 | 11,667 | 314,745 | 144,118 | 64,319 | 54,903 | 21,608 | 12,537 | 297,485 | ||||||||||||||||||||||||||||||||||||
Cost of goods sold | 51,825 | 12,907 | 27,468 | 6,378 | 2,083 | 100,661 | 47,414 | 13,240 | 26,332 | 5,046 | 3,173 | 95,205 | ||||||||||||||||||||||||||||||||||||
Contribution | 115,692 | 40,388 | 32,326 | 16,094 | 9,584 | 214,084 | 96,704 | 51,079 | 28,571 | 16,562 | 9,364 | 202,280 | ||||||||||||||||||||||||||||||||||||
Less SG&A | 59,611 | 15,741 | 18,324 | 8,261 | 6,024 | 107,961 | 57,225 | 19,645 | 18,323 | 7,603 | 5,509 | 108,305 | ||||||||||||||||||||||||||||||||||||
EBITDA | 56,081 | 24,647 | 14,002 | 7,833 | 3,560 | 106,123 | 39,479 | 31,434 | 10,248 | 8,959 | 3,855 | 93,975 | ||||||||||||||||||||||||||||||||||||
Add share-based compensation | 1,208 | 570 | 423 | 245 | - | 2,446 | 1,371 | 1,005 | 572 | 281 | - | 3,229 | ||||||||||||||||||||||||||||||||||||
Add non-cash contribution adjustment | (82 | ) | (39 | ) | (24 | ) | (15 | ) | - | (160 | ) | 220 | 151 | 73 | 36 | - | 480 | |||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | 57,207 | 25,178 | 14,401 | 8,063 | 3,560 | 108,409 | $ | 41,070 | 32,590 | 10,893 | 9,276 | 3,855 | 97,684 |
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||||
KEY PERFORMANCE INDICATORS | ||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
June 30, 2010 | June 30, 2010 | |||||||||||||||||||||||||||
as compared to | as compared to | |||||||||||||||||||||||||||
June 30, | June 30, | March 31, | June 30, | March 31, | June 30, | March 31, | ||||||||||||||||||||||
2010 | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 | ||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||
Voice | ||||||||||||||||||||||||||||
Long-distance subscribers | 90,200 | 88,600 | 91,200 | 1,600 | (1,000 | ) | 1.8 | % | -1.1 | % | ||||||||||||||||||
Total local access lines in service | 85,100 | 81,200 | 85,800 | 3,900 | (700 | ) | 4.8 | % | -0.8 | % | ||||||||||||||||||
Local access lines in service on GCI facilities | 77,100 | 70,300 | 77,300 | 6,800 | (200 | ) | 9.7 | % | -0.3 | % | ||||||||||||||||||
Video | ||||||||||||||||||||||||||||
Basic subscribers | 131,200 | 129,700 | 131,400 | 1,500 | (200 | ) | 1.2 | % | -0.2 | % | ||||||||||||||||||
Digital programming tier subscribers | 80,600 | 76,200 | 81,400 | 4,400 | (800 | ) | 5.8 | % | -1.0 | % | ||||||||||||||||||
HD/DVR converter boxes | 86,500 | 74,400 | 86,000 | 12,100 | 500 | 16.3 | % | 0.6 | % | |||||||||||||||||||
Homes passed | 234,700 | 230,400 | 232,900 | 4,300 | 1,800 | 1.9 | % | 0.8 | % | |||||||||||||||||||
Data | ||||||||||||||||||||||||||||
Cable modem subscribers | 103,500 | 94,900 | 103,100 | 8,600 | 400 | 9.1 | % | 0.4 | % | |||||||||||||||||||
Wireless | ||||||||||||||||||||||||||||
Wireless lines in service | 119,000 | 103,600 | 117,500 | 15,400 | 1,500 | 14.9 | % | 1.3 | % | |||||||||||||||||||
Network Access Services | ||||||||||||||||||||||||||||
Data: | ||||||||||||||||||||||||||||
Total ISP access lines in service | 1,700 | 1,700 | 1,700 | - | - | 0.0 | % | 0.0 | % | |||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Voice: | ||||||||||||||||||||||||||||
Long-distance subscribers | 9,400 | 9,600 | 9,400 | (200 | ) | - | -2.1 | % | 0.0 | % | ||||||||||||||||||
Total local access lines in service | 48,000 | 47,300 | 48,400 | 700 | (400 | ) | 1.5 | % | -0.8 | % | ||||||||||||||||||
Local access lines in service on GCI facilities | 20,600 | 18,400 | 20,400 | 2,200 | 200 | 12.0 | % | 1.0 | % | |||||||||||||||||||
Video | ||||||||||||||||||||||||||||
Hotels and mini-headend subscribers | 18,500 | 20,300 | 16,100 | (1,800 | ) | 2,400 | -8.9 | % | 14.9 | % | ||||||||||||||||||
Basic subscribers | 1,800 | 1,700 | 1,700 | 100 | 100 | 5.9 | % | 5.9 | % | |||||||||||||||||||
Total basic subscribers | 20,300 | 22,000 | 17,800 | (1,700 | ) | 2,500 | -7.7 | % | 14.0 | % | ||||||||||||||||||
Data | ||||||||||||||||||||||||||||
Cable modem subscribers | 10,800 | 10,400 | 10,500 | 400 | 300 | 3.8 | % | 2.9 | % | |||||||||||||||||||
Wireless | ||||||||||||||||||||||||||||
Wireless lines in service | 12,200 | 8,900 | 10,600 | 3,300 | 1,600 | 37.1 | % | 15.1 | % | |||||||||||||||||||
Regulated Operations | ||||||||||||||||||||||||||||
Voice: | ||||||||||||||||||||||||||||
Total local access lines in service | 10,600 | 11,600 | 10,800 | (1,000 | ) | (200 | ) | -8.6 | % | -1.9 | % | |||||||||||||||||
June 30, 2010 | June 30, 2010 | |||||||||||||||||||||||||||
Three Months Ended | as Compared to | as Compared to | ||||||||||||||||||||||||||
June 30, | June 30, | March 31, | June 30, | March 31, | June 30, | March 31, | ||||||||||||||||||||||
2010 | 2009 | 2010 | 2009 | 2010 | 2009 | 2010 | ||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||
Voice | ||||||||||||||||||||||||||||
Long-distance minutes carried (in millions) | 26.7 | 28.3 | 28.3 | (1.6 | ) | (1.6 | ) | -5.7 | % | -5.7 | % | |||||||||||||||||
Video | ||||||||||||||||||||||||||||
Average monthly gross revenue per subscriber | $ | 74.54 | $ | 69.59 | $ | 73.80 | $ | 4.95 | $ | 0.74 | 7.1 | % | 1.0 | % | ||||||||||||||
Wireless | ||||||||||||||||||||||||||||
Average monthly gross revenue per subscriber | $ | 57.96 | $ | 57.88 | $ | 59.99 | $ | 0.08 | $ | (2.03 | ) | 0.1 | % | -3.4 | % | |||||||||||||
Network Access Services | ||||||||||||||||||||||||||||
Voice | ||||||||||||||||||||||||||||
Long-distance minutes carried (in millions) | 201.3 | 215.6 | 193.6 | (14.3 | ) | 7.7 | -6.6 | % | 4.0 | % | ||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||
Voice: | ||||||||||||||||||||||||||||
Long-distance minutes carried (in millions) | 29.4 | 31.8 | 29.6 | (2.4 | ) | (0.2 | ) | -7.5 | % | -0.7 | % | |||||||||||||||||
Total | ||||||||||||||||||||||||||||
Long-distance minutes carried (in millions) | 257.4 | 275.7 | 251.5 | (18.3 | ) | 5.9 | -6.6 | % | 2.3 | % |
General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)
Three Months Ended | ||||||||||||
June 30, 2010 | June 30, 2009 | March 31, 2010 | ||||||||||
Net income | $ | 1.9 | 2.6 | 1.7 | ||||||||
Income tax expense (benefit) | 5.5 | 2.7 | (0.2 | ) | ||||||||
Income before income tax expense (benefit) | 7.4 | 5.3 | 1.5 | |||||||||
Other (income) expense: | ||||||||||||
Interest expense (including amortization of deferred loan fees) | 17.8 | 13.2 | 17.7 | |||||||||
Interest income | (0.1 | ) | --- | --- | ||||||||
Other expense, net | 17.7 | 13.2 | 17.7 | |||||||||
Operating income | 25.1 | 18.5 | 19.2 | |||||||||
Depreciation and amortization expense | 30.8 | 31.2 | 31.1 | |||||||||
EBITDA (Note 2) | 55.9 | 49.7 | 50.3 | |||||||||
Share-based compensation | 1.6 | 1.4 | 0.8 | |||||||||
Non-cash contribution adjustment | (0.1 | ) | 0.1 | --- | ||||||||
Adjusted EBITDA (Note 1) | $ | 57.4 | 51.2 | 51.1 |
General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)
Six Months Ended | ||||||||
June 30, 2010 | June 30, 2009 | |||||||
Net income | $ | 3.6 | 2.9 | |||||
Income tax expense | 5.3 | 3.3 | ||||||
Income before income tax expense | 8.9 | 6.2 | ||||||
Other (income) expense: | ||||||||
Interest expense (including amortization of deferred loan fees) | 35.4 | 25.9 | ||||||
Interest income | (0.1 | ) | --- | |||||
Other expense, net | 35.3 | 25.9 | ||||||
Operating income | 44.2 | 32.1 | ||||||
Depreciation and amortization expense | 61.9 | 61.9 | ||||||
EBITDA (Note 2) | 106.1 | 94.0 | ||||||
Share-based compensation | 2.4 | 3.2 | ||||||
Non-cash contribution adjustment | (0.1 | ) | 0.5 | |||||
Adjusted EBITDA (Note 1) | $ | 108.4 | 97.7 |
General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)
Notes:
(1) EBITDA (as defined in Note 2 below) before deducting share-based compensation and non-cash contribution adjustment. |
(2) Earnings Before Interest, Taxes, Depreciation and Amortization is the sum of Net Income (Loss), Interest Expense (including Amortization of Deferred Loan Fees), Interest Income, Income Tax Expense (Benefit), and Depreciation and Amortization Expense. EBITDA is not presented as an alternative measure of net income, operating income or cash flow from operations, as determined in accordance with accounting principles generally accepted in the United States of America. GCI's management uses EBITDA to evaluate the operating performance of its business, and as a measure of performance for incentive compensation purposes. GCI believes EBITDA is a measure used as an analytical indicator of income generated to service debt and fund capital expenditures. In addition, multiples of current or projected EBITDA are used to estimate current or prospective enterprise value. EBITDA d oes not give effect to cash used for debt service requirements, and thus does not reflect funds available for investment or other discretionary uses. EBITDA as presented herein may not be comparable to similarly titled measures reported by other companies. |