August 3, 2011
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 2011 FINANCIAL RESULTS
| · | Consolidated revenue of $168.1 million |
| · | Adjusted EBITDA of $54.9 million |
| · | Net loss of $2.0 million or $(0.04) per diluted share |
ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its second quarter 2011 results with revenues increasing to $168.1 million over revenues of $162.3 million in the second quarter of 2010. Adjusted EBITDA decreased $2.4 million or 4.2 percent from the second quarter of 2010 EBITDA of $57.4 million. Adjusted EBITDA for the second quarter of 2011 increased $0.6 million after excluding the benefit of $3 million in net adjustments to EBITDA reflected in the second quarter of 2010. The 2010 adjustments were related to a change in USF estimates and a contract reserve adjustment for a large customer.
GCI’s second quarter 2011 net loss totaled $2.0 million or loss per diluted share of $(0.04) and compares to net income of $1.9 million, or earnings per diluted share of $0.04 for the same period of 2010. GCI‘s second quarter net loss is primarily related to a $9.1 million loss on debt extinguishment related to the refinancing of the company’s $320 million Senior Notes due 2014 that were replaced with a new issue due 2021.
Second quarter of 2011 revenues increased 2.0 percent or $3.3 million over first quarter of 2011 revenues. Adjusted EBITDA increased 3.0 percent or $1.6 million over the first quarter of 2011 Adjusted EBITDA.
“GCI’s results for the second quarter were flat as a result of soft consumer metrics.” said GCI president Ron Duncan. “Consumer growth was adversely affected by a large troop deployment from Fort Wainwright in Fairbanks, a billing clean-up and delays in the implementation of new systems and products. Most of those issues are behind us now and we expect to return to more normal consumer growth patterns in the second half of the year. Presently we expect results for the full year to be within the range of our guidance.
“We are on track with our important TERRA project and anticipate that it will be completed this year. We also continued to make strong progress on our stock repurchase program by retiring more than $14 million worth of stock in the second quarter.
GCI previously provided guidance on revenues of $685 million to $700 million and adjusted EBITDA of $233 million to $238 million for the year 2011.
Highlights
| · | GCI repurchased 1,233,067 shares of its Class A common stock in the second quarter of 2011 at an average price per share of $11.44. GCI is authorized to repurchase $114.4 million of its common equity depending on company performance, market conditions, and liquidity, and subject to board oversight. At the end of the second quarter of 2011 GCI had approximately 45.7 million shares outstanding. |
| · | GCI is the second largest wireless provider in Alaska with 141,000 wireless subscribers at the end of the quarter, an increase of 800 subscribers over the end of the first quarter of 2011. |
| · | Consumer revenues for the second quarter of 2011 totaled $88.6 million, an increase of 1.6 percent over the second quarter of 2010. Consumer revenues for the second quarter of 2010 benefited from a $4.1 million USF estimate change. Excluding the estimate change for the prior year, consumer revenues increased $5.5 million or 6.6 percent over 2010. Revenue increases were in the video, data and wireless product lines during the second quarter of 2011. |
| · | Commercial revenues increased $2.1 million to $34.2 million as compared to $32.1 million in the second quarter of 2010 and increased $2.4 million over $31.8 million in the first quarter of 2011. Commercial revenues for the second quarter of 2010 were favorably impacted by a $0.6 million USF estimate change. The increase in revenues was primarily due to an increase in data service revenues, mostly from the oil sector. |
| · | Managed Broadband revenues increased $4.3 million or 40.9 percent over the second quarter of 2010 and increased $0.6 million or 4.6 percent over the first quarter of 2011. The second quarter of 2010 reflected a $1.7 million contract reserve adjustment. Excluding the contract reserve adjustment, managed broadband revenues increased $2.6 million or 21.1 percent over the prior year. |
| · | GCI had 142,400 access lines at the end of the second quarter of 2011, representing an estimated 36 percent share of the total access line market in Alaska. Access lines decreased by 2,900 lines from the first quarter of 2011. |
| · | GCI’s facilities-based access lines totaled 112,300, representing 78.9 percent of its total access lines at the end of the second quarter of 2011. Reported facilities based access lines decreased 2,000 lines from the first quarter of 2011. The decrease in lines is primarily due to a large troop deployment from Ft. Wainwright, located near Fairbanks. |
| · | GCI had 116,400 consumer and commercial cable modem customers at the end of the second quarter of 2011, a decrease of 1,600 from the 118,000 cable modem customers at the end of the first quarter 2011. The decrease in customers is primarily due to the troop deployment in Fairbanks. Average monthly revenue per cable modem for the second quarter of 2011 was $53.85, an increase of 15.3 percent over the $46.69 figure posted for the prior year and 3.1 percent from the $52.21 figure posted for the first quarter of 2011. |
Consumer
Consumer revenues increased 1.6 percent to $88.6 million as compared to $87.1 million in the second quarter of 2010 and were level with the first quarter of 2011. Consumer revenues for the second quarter of 2010 benefited from a $4.1 million in USF estimate change. Excluding the estimate change for the prior year, consumer revenues increased $5.5 million or 6.6 percent over 2010. Video, data and wireless revenue growth continue to drive financial results in the consumer business.
Consumer customer metrics for the quarter were directly impacted by the deployment of more than 4,000 troops from Fort Wainwright in Fairbanks. GCI estimates the deployment resulted in a reduction of approximately 1,100 wired access lines, 1,000 basic video subscribers, 1,200 cable modems and more than 300 wireless subscribers.
Consumer voice revenues of $13.6 million, as expected, were lower when compared to the second quarter of 2010 and were steady with the first quarter of 2011. Consumer voice revenues for the second quarter of 2010 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 the second quarter of 2011 totaled 82,300, a decrease of 2,800 lines from the second quarter of 2010 and the first quarter of 2011. The decrease in access lines, in part, is a result of customers discontinuing wire line service and relying solely on wireless devices. While GCI has consistently grown share in the wire line market, that share growth is no longer sufficient to offset the decreasing overall size of the wire line access market. The troop deployment also contributed to the decrease in local access lines as local service is often bundled with video and internet service.
GCI serves 75,900 consumer access lines on its own facilities, a decrease of 1,200 and 2,100 lines from the second quarter of 2010 and the first quarter of 2011, respectively. More than 92 percent of consumer access lines are provisioned exclusively on GCI facilities.
Consumer video revenues of $29.5 million increased 0.7 percent over the second quarter of 2010 and decreased 2.6 percent from the first quarter of 2011. The increase over the prior year is largely due to increases in video subscribers renting high definition/digital video recorder converters. Consumer basic video subscribers totaled 126,900 at the end of the second quarter of 2011, a decrease of 4,300 subscribers from the second quarter of 2010 and 3,300 subscribers from the first quarter of 2011. The decrease in subscribers from the prior year is primarily due to the troop deployment. The sequential decrease in subscribers is primarily due to the troop deployment and seasonality.
Consumer data revenues of $17.3 million increased 18.1 percent over the second quarter of 2010 and were steady with the first quarter of 2011. The increase in consumer data revenues over the prior year is due to an increase in cable modem customers and increasing average monthly usage per cable modem. GCI added 1,900 consumer cable modem customers over the second quarter of 2010 and cable modem customer counts decreased by 1,800 on a sequential basis. The sequential decrease in cable modems is primarily due to the troop deployment.
Consumer wireless revenues of $28.1 million for the second quarter of 2011 were steady with the second quarter of 2010 and increased 1.8 percent over the first quarter of 2011. Consumer wireless revenues for the second quarter of 2010 were favorably impacted by a $2.9 million USF estimate change. Excluding the USF estimate change, consumer wireless revenue increased $3.1 million or 12.4 percent over the prior year. Consumer has added 7,400 wireless customers over the end of the second quarter a year ago, an increase of 6.2 percent. Consumer wireless customers decreased by 100 lines as compared to the end of the first quarter of 2011. Sequential wireless net additions were unfavorably impacted by the troop deployment and the implementation of a new policy for wireless lifeline customers.
Network Access
Network access revenues decreased 7.2 percent to $25.2 million as compared to $27.1 million in the second quarter of 2010 and were steady with the first quarter of 2011.
Voice revenues, as expected, decreased 24.2 percent to $5.4 million from the prior year and 15.9 percent from the first quarter of 2011. The decrease in voice revenues is primarily due to the continued decrease in the wired voice market as a result of wireless and data substitution. Long distance minutes decreased 6.9 percent from the prior year and decreased 1.7 percent from the first quarter of 2011.
Data revenues were down 5.1 percent compared to the second quarter of 2010 and were steady with the first quarter of 2011. The decrease in data revenues is primarily attributable to lower rates resulting from the extension of national pricing schedules into the Alaska market and the continuing shift to IP-based transport.
Wireless revenues, primarily related to roaming traffic, increased 14.0 percent to $4.7 million over the prior year and 28.2 percent sequentially. The increase in revenues is primarily due to seasonality.
Commercial
Commercial revenues increased $2.1 million to $34.2 million as compared to $32.1 million in the second quarter of 2010 and increased $2.4 million over $31.8 million in the first quarter of 2011. Commercial revenues for the second quarter of 2010 were favorably impacted by a $0.6 million USF estimate change. The increase in revenues for the quarter was primarily due to an increase in data service revenues, mostly from the oil sector.
Voice revenues for the second quarter of 2011 decreased 13.1 percent or $1.1 million when compared to the second quarter of 2010 and were relatively steady when compared with the first quarter of 2011. Voice revenues for the second quarter decreased 8.8 percent or $0.7 million, excluding an $0.4 million USF estimate change in the second quarter of 2010. Long distance minutes decreased 4.7 percent from the prior year and decreased 1.0 percent from the first quarter of 2011. Local access lines at the end of the second quarter of 2011 increased by 400 lines sequentially. Local access lines served entirely on GCI’s facilities increased by 5,000 lines when compared to the prior year and increased by 400 over the first quarter of 2011. The increase in lines over the prior year is primarily due to the correction of a classification error in calculating the number of lines on our facilities.
Commercial video revenues increased $0.3 million over the prior year and $0.1 million sequentially. Commercial video subscribers total 20,300 at the end of the second quarter of 2011 and were unchanged when compared to the end of the prior year. Commercial video subscribers at the end of the second quarter increased by 3,100 subscribers over the first quarter of 2011. The sequential increase in basic subscribers is primarily attributed to the seasonal increase in hotel subscribers.
Commercial data service 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 $10.0 million increased by $1.1 million as compared to the second quarter of 2010 and time and material charges for support activities increased by $1.6 million to $11.5 million for the second quarter of 2011 as a result of increased activity primarily in the oil sector. Commercial data service revenues were $21.5 million in the second quarter of 2011, an increase of $2.7 million from the second quarter of 2010 and $2.4 million from the first quarter of 2011.
Commercial wireless revenues totaled $2.4 million for the second quarter of 2011 and increased 12.5 percent or $0.3 million from the second quarter of 2010 and were steady with the first quarter of 2011. Wireless revenues for the second quarter increased 24.0 percent or $0.5 million excluding a $0.2 million USF estimate change in the second quarter of 2010. GCI had 14,600 Commercial wireless subscribers at the end of the second quarter of 2011, an increase of 2,400 subscribers over the prior year and 900 subscribers sequentially.
Managed Broadband
Managed broadband revenues increased $4.3 million or 40.9 percent over the second quarter of 2010 and increased $0.6 million or 4.6 percent over the first quarter of 2011. The second quarter of 2010 reflected a $1.7 million contract reserve adjustment. Excluding the contract reserve adjustment, managed broadband revenues increased $2.6 million or 21.1 percent over the prior year.
Regulated Operations
Regulated operations revenues totaled $5.5 million in the second quarter of 2011 and were steady when compared to the second quarter of 2010 and the first quarter of 2011. Regulated operations had 9,400 local access lines at the end of the second quarter of 2011, a decrease of 1,200 lines from the second quarter of 2010 and a decrease of 400 lines from the first quarter of 2011.
Other Items
SG&A expenses for the second quarter of 2011 totaled $57.7 million, an increase of 5.5 percent as compared to $54.7 million for the second quarter of 2010. The increase is due to increases in health care, labor and related benefits and contract services offset in part by a decrease in success sharing costs. As a percentage of revenues, SG&A expenses are steady at 34 percent in the second quarter of 2011 as compared to the prior year. SG&A expenses for the second quarter decreased $1.2 million from the first quarter of 2011. The decrease is primarily related to a reduction in success sharing costs.
GCI’s second quarter 2011 capital expenditures totaled $45.6 million as compared to $27.1 million in the second quarter of 2010 and $28.3 million in the first quarter of 2011. The second quarter 2011 capital expenditures include $19.3 million related to the TERRA-SW project and compares to $16.0 million spent in the first quarter of 2011. GCI has received RUS loan and grant funds totaling $5.7 million for the year.
GCI refinanced the company’s $320 million face value, 7.25 percent 2014 senior notes replacing them with a new issue due 2021 with a $325 million face value, 6.75 percent. In addition, GCI added two $25 million term loans to its senior credit facilities, one of which closed prior to the end of second quarter, the second add-on term loan closed July 22, 2011. The bond refinancing added no net new cash to the company and the add-on term loan proceeds were used to repay a portion of the outstandings on the company’s $75 million revolving credit facility and for other general corporate purposes, including the funding of GCI’s core capital expenditures.
GCI will hold a conference call to discuss the quarter’s results on Thursday, August 4, 2011 beginning at 2 p.m. (Eastern). To access the briefing on August 4, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 800-779-1626 (International callers should dial 1-517-623-4003) 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 800-677-6119, access code 7461 (International callers should dial 203-369-3700.)
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 | | 2011 | | | 2010 | |
| | | | | | | |
| Current assets: | | | | | | |
| Cash and cash equivalents | | $ | 25,869 | | | | 33,070 | |
| | | | | | | | | |
| Receivables | | | 155,632 | | | | 132,856 | |
| Less allowance for doubtful receivables | | | 7,530 | | | | 9,189 | |
| Net receivables | | | 148,102 | | | | 123,667 | |
| | | | | | | | | |
| Deferred income taxes | | | 10,145 | | | | 10,145 | |
| Prepaid expenses | | | 9,141 | | | | 5,950 | |
| Inventories | | | 6,523 | | | | 5,804 | |
| Other current assets | | | 3,734 | | | | 3,940 | |
| Total current assets | | | 203,514 | | | | 182,576 | |
| | | | | | | | | |
| Property and equipment in service, net of depreciation | | | 766,051 | | | | 798,278 | |
| Construction in progress | | | 77,549 | | | | 31,144 | |
| Net property and equipment | | | 843,600 | | | | 829,422 | |
| | | | | | | | | |
| Cable certificates | | | 191,635 | | | | 191,635 | |
| Goodwill | | | 73,932 | | | | 73,932 | |
| Wireless licenses | | | 25,967 | | | | 25,967 | |
| Other intangible assets, net of amortization | | | 16,435 | | | | 17,717 | |
| Deferred loan and senior notes costs, net of amortization | | | 13,418 | | | | 13,661 | |
| Other assets | | | 16,333 | | | | 16,850 | |
| Total other assets | | | 337,720 | | | | 339,762 | |
| Total assets | | $ | 1,384,834 | | | | 1,351,760 | |
| | | | | | | | | |
| | | | | | | (Continued) | |
| GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | | | | | | |
| CONSOLIDATED BALANCE SHEETS | | | | | | |
| (Unaudited) | | | | | | |
| (Continued) | | | | | | |
| | | | | | | |
| | | | | | | |
| (Amounts in thousands) | | | | | | |
| | | June 30, | | | December 31, | |
| Liabilities and Stockholders' Equity | | 2011 | | | 2010 | |
| | | | | | | |
| Current liabilities: | | | | | | |
| Current maturities of obligations under long-term debt and capital leases | | $ | 7,693 | | | | 7,652 | |
| Accounts payable | | | 39,496 | | | | 35,589 | |
| Deferred revenue | | | 18,160 | | | | 17,296 | |
| Accrued payroll and payroll related obligations | | | 20,792 | | | | 22,132 | |
| Accrued interest | | | 7,326 | | | | 13,456 | |
| Accrued liabilities | | | 12,910 | | | | 12,557 | |
| Subscriber deposits | | | 1,222 | | | | 1,271 | |
| Total current liabilities | | | 107,599 | | | | 109,953 | |
| | | | | | | | | |
| Long-term debt, net | | | 830,595 | | | | 779,201 | |
| Obligations under capital leases, excluding current maturities | | | 81,433 | | | | 84,144 | |
| Obligation under capital lease due to related party | | | 1,890 | | | | 1,885 | |
| Deferred income taxes | | | 101,845 | | | | 102,401 | |
| Long-term deferred revenue | | | 56,645 | | | | 49,175 | |
| Other liabilities | | | 22,921 | | | | 24,495 | |
| Total liabilities | | | 1,202,928 | | | | 1,151,254 | |
| | | | | | | | | |
| | | | | | | | | |
| Commitments and contingencies | | | | | | | | |
| Stockholders’ equity: | | | | | | | | |
| Common stock (no par): | | | | | | | | |
Class A. Authorized 100,000 shares; issued 42,762 and 44,213 shares at June 30, 2011 and December 31, 2010, respectively; outstanding 42,508 and 43,958 shares at June 30, 2011 and December 31, 2010, respectively | | | 48,796 | | | | 69,396 | |
| | | | | | | | | |
Class B. Authorized 10,000 shares; issued and outstanding 3,176 and 3,178 shares at June 30, 2011 and December 31, 2010, respectively; convertible on a share-per-share basis into Class A common stock | | | 2,683 | | | | 2,677 | |
| | | | | | | | | |
Less cost of 254 and 255 Class A common shares held in treasury at June 30, 2011 and December 31, 2010, respectively | | | (2,240 | ) | | | (2,249 | ) |
| | | | | | | | | |
| Paid-in capital | | | 39,532 | | | | 37,075 | |
| Retained earnings | | | 93,135 | | | | 93,607 | |
| Total stockholders' equity | | | 181,906 | | | | 200,506 | |
| | | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 1,384,834 | | | | 1,351,760 | |
| GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
| CONSOLIDATED STATEMENTS OF OPERATIONS |
| (Unaudited) |
| | | | | | | | | | | | | |
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| (Amounts in thousands, except per share amounts) | | 2011 | | | 2010 | | | 2011 | | | 2010 | |
| | | | | | | | | | | | | |
| Revenues | | $ | 168,089 | | | | 162,326 | | | | 332,866 | | | | 314,745 | |
| | | | | | | | | | | | | | | | | |
Cost of goods sold (exclusive of depreciation and amortization shown separately below) | | | 57,314 | | | | 51,754 | | | | 111,070 | | | | 100,661 | |
| Selling, general and administrative expenses | | | 57,697 | | | | 54,704 | | | | 116,590 | | | | 107,961 | |
| Depreciation and amortization expense | | | 30,632 | | | | 30,820 | | | | 62,352 | | | | 61,946 | |
| Operating income | | | 22,446 | | | | 25,048 | | | | 42,854 | | | | 44,177 | |
| | | | | | | | | | | | | | | | | |
| Other income (expense): | | | | | | | | | | | | | | | | |
| Interest expense (including amortization of deferred loan fees) | | | (17,294 | ) | | | (17,729 | ) | | | (34,746 | ) | | | (35,409 | ) |
| Loss on extinguishment of debt | | | (9,111 | ) | | | - | | | | (9,111 | ) | | | - | |
| Interest income | | | 4 | | | | 76 | | | | 8 | | | | 137 | |
| Other | | | (9 | ) | | | - | | | | (33 | ) | | | - | |
| Other expense, net | | | (26,410 | ) | | | (17,653 | ) | | | (43,882 | ) | | | (35,272 | ) |
| | | | | | | | | | | | | | | | | |
| Income (loss) before income tax (expense) benefit | | | (3,964 | ) | | | 7,395 | | | | (1,028 | ) | | | 8,905 | |
| | | | | | | | | | | | | | | | | |
| Income tax (expense) benefit | | | 2,007 | | | | (5,465 | ) | | | 556 | | | | (5,301 | ) |
| | | | | | | | | | | | | | | | | |
| Net income (loss) | | $ | (1,957 | ) | | | 1,930 | | | | (472 | ) | | | 3,604 | |
| | | | | | | | | | | | | | | | | |
| Basic net income (loss) per Class A common share | | $ | (0.04 | ) | | | 0.04 | | | | (0.01 | ) | | | 0.07 | |
| | | | | | | | | | | | | | | | | |
| Basic net income (loss) per Class B common share | | $ | (0.04 | ) | | | 0.04 | | | | (0.01 | ) | | | 0.07 | |
| | | | | | | | | | | | | | | | | |
| Diluted net income (loss) per Class A common share | | $ | (0.04 | ) | | | 0.04 | | | | (0.01 | ) | | | 0.07 | |
| | | | | | | | | | | | | | | | | |
| Diluted net income (loss) per Class B common share | | $ | (0.04 | ) | | | 0.04 | | | | (0.01 | ) | | | 0.07 | |
| | | | | | | | | | | | | | | | | |
| Common shares used to calculate Class A basic EPS | | | 43,098 | | | | 51,489 | | | | 43,536 | | | | 51,534 | |
| | | | | | | | | | | | | | | | | |
| Common shares used to calculate Class A diluted EPS | | | 46,276 | | | | 54,745 | | | | 46,714 | | | | 54,786 | |
| GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
| SUPPLEMENTAL SCHEDULES |
| (Unaudited) | |
| (Amounts in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Second Quarter 2011 | | | Second Quarter 2010 | |
| | | | | | Network | | | | | | Managed | | | Regulated | | | | | | Network | | | | | | Managed | | | Regulated |
| | | Consumer | | | Access | | | Commercial | | | Broadband | | | Operations | | | Totals | | | Consumer | | | Access | | | Commercial | | | Broadband | | | Operations | | | Totals | |
| Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice | | $ | 13,625 | | | | 5,441 | | | | 7,340 | | | | - | | | | 5,529 | | | | 31,935 | | | $ | 15,254 | | | | 7,176 | | | | 8,448 | | | | - | | | | 5,607 | | | | 36,485 | |
| Video | | | 29,546 | | | | - | | | | 2,936 | | | | - | | | | - | | | | 32,482 | | | | 29,352 | | | | - | | | | 2,639 | | | | - | | | | - | | | | 31,991 | |
| Data | | | 17,257 | | | | 15,023 | | | | 21,518 | | | | 14,639 | | | | - | | | | 68,437 | | | | 14,608 | | | | 15,823 | | | | 18,831 | | | | 10,387 | | | | - | | | | 59,649 | |
| Wireless | | | 28,126 | | | | 4,687 | | | | 2,422 | | | | - | | | | - | | | | 35,235 | | | | 27,935 | | | | 4,113 | | | | 2,153 | | | | - | | | | - | | | | 34,201 | |
| Total | | | 88,554 | | | | 25,151 | | | | 34,216 | | | | 14,639 | | | | 5,529 | | | | 168,089 | | | | 87,149 | | | | 27,112 | | | | 32,071 | | | | 10,387 | | | | 5,607 | | | | 162,326 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cost of goods sold | | | 28,011 | | | | 6,576 | | | | 16,932 | | | | 4,580 | | | | 1,215 | | | | 57,314 | | | | 26,192 | | | | 6,379 | | | | 15,097 | | | | 3,160 | | | | 926 | | | | 51,754 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Contribution | | | 60,543 | | | | 18,575 | | | | 17,284 | | | | 10,059 | | | | 4,314 | | | | 110,775 | | | | 60,957 | | | | 20,733 | | | | 16,974 | | | | 7,227 | | | | 4,681 | | | | 110,572 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Less SG&A | | | 33,288 | | | | 6,570 | | | | 10,233 | | | | 4,513 | | | | 3,093 | | | | 57,697 | | | | 30,445 | | | | 7,897 | | | | 9,179 | | | | 4,219 | | | | 2,964 | | | | 54,704 | |
| Less other | | | - | | | | - | | | | - | | | | 9 | | | | - | | | | 9 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| EBITDA | | | 27,255 | | | | 12,005 | | | | 7,051 | | | | 5,537 | | | | 1,221 | | | | 53,069 | | | | 30,512 | | | | 12,836 | | | | 7,795 | | | | 3,008 | | | | 1,717 | | | | 55,868 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Add share-based compensation | | | 894 | | | | 301 | | | | 319 | | | | 156 | | | | - | | | | 1,670 | | | | 825 | | | | 390 | | | | 273 | | | | 155 | | | | - | | | | 1,643 | |
| Add accretion | | | 109 | | | | 38 | | | | 31 | | | | 16 | | | | - | | | | 194 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Add other | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (82 | ) | | | (39 | ) | | | (24 | ) | | | (15 | ) | | | - | | | | (160 | ) |
| Adjusted EBITDA | | $ | 28,258 | | | | 12,344 | | | | 7,401 | | | | 5,709 | | | | 1,221 | | | | 54,933 | | | $ | 31,255 | | | | 13,187 | | | | 8,044 | | | | 3,148 | | | | 1,717 | | | | 57,351 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| GENERAL COMMUNICATION, INC. AND SUBSIDIARIES | |
| SUPPLEMENTAL SCHEDULES |
| (Unaudited) |
| (Amounts in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Second Quarter 2011 | | | | First Quarter 2011 |
| | | | | | | Network | | | | | | | Managed | | | Regulated | | | | | | | Network | | | | | | | Managed | | | Regulated | |
| | | Consumer | | | Access | | | Commercial | | | Broadband | | | Operations | | | Totals | | | Consumer | | | Access | | | Commercial | | | Broadband | | | Operations | | | Totals | |
| Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice | | $ | 13,625 | | | | 5,441 | | | | 7,340 | | | | - | | | | 5,529 | | | | 31,935 | | | $ | 13,752 | | | | 6,470 | | | | 7,573 | | | | - | | | | 5,439 | | | | 33,234 | |
| Video | | | 29,546 | | | | - | | | | 2,936 | | | | - | | | | - | | | | 32,482 | | | | 30,339 | | | | - | | | | 2,840 | | | | - | | | | - | | | | 33,179 | |
| Data | | | 17,257 | | | | 15,023 | | | | 21,518 | | | | 14,639 | | | | - | | | | 68,437 | | | | 16,701 | | | | 14,972 | | | | 19,095 | | | | 13,995 | | | | - | | | | 64,763 | |
| Wireless | | | 28,126 | | | | 4,687 | | | | 2,422 | | | | - | | | | - | | | | 35,235 | | | | 27,625 | | | | 3,655 | | | | 2,321 | | | | - | | | | - | | | | 33,601 | |
| Total | | | 88,554 | | | | 25,151 | | | | 34,216 | | | | 14,639 | | | | 5,529 | | | | 168,089 | | | | 88,417 | | | | 25,097 | | | | 31,829 | | | | 13,995 | | | | 5,439 | | | | 164,777 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cost of goods sold | | | 28,011 | | | | 6,576 | | | | 16,932 | | | | 4,580 | | | | 1,215 | | | | 57,314 | | | | 27,308 | | | | 6,665 | | | | 14,866 | | | | 3,914 | | | | 1,003 | | | | 53,756 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Contribution | | | 60,543 | | | | 18,575 | | | | 17,284 | | | | 10,059 | | | | 4,314 | | | | 110,775 | | | | 61,109 | | | | 18,432 | | | | 16,963 | | | | 10,081 | | | | 4,436 | | | | 111,021 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Less SG&A | | | 33,288 | | | | 6,570 | | | | 10,233 | | | | 4,513 | | | | 3,093 | | | | 57,697 | | | | 33,375 | | | | 6,778 | | | | 10,537 | | | | 4,467 | | | | 3,736 | | | | 58,893 | |
| Less other | | | - | | | | - | | | | - | | | | 9 | | | | - | | | | 9 | | | | - | | | | - | | | | - | | | | 24 | | | | - | | | | 24 | |
| EBITDA | | | 27,255 | | | | 12,005 | | | | 7,051 | | | | 5,537 | | | | 1,221 | | | | 53,069 | | | | 27,734 | | | | 11,654 | | | | 6,426 | | | | 5,590 | | | | 700 | | | | 52,104 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Add share-based compensation | | | 894 | | | | 301 | | | | 319 | | | | 156 | | | | - | | | | 1,670 | | | | 619 | | | | 212 | | | | 224 | | | | 115 | | | | - | | | | 1,170 | |
| Add accretion | | | 109 | | | | 38 | | | | 31 | | | | 16 | | | | - | | | | 194 | | | | 41 | | | | 14 | | | | 12 | | | | 6 | | | | - | | | | 72 | |
| Adjusted EBITDA | | $ | 28,258 | | | | 12,344 | | | | 7,401 | | | | 5,709 | | | | 1,221 | | | | 54,933 | | | $ | 28,393 | | | | 11,880 | | | | 6,662 | | | | 5,711 | | | | 700 | | | | 53,346 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
| SUPPLEMENTAL SCHEDULES |
| (Unaudited) |
| (Amounts in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Six Months Ended June 30, 2011 | | | Six Months Ended June 30, 2010 |
| | | | | | | Network | | | | | | | Managed | | | Regulated | | | | | | | Network | | | | | | | Managed | | | Regulated | |
| | | Consumer | | | Access | | | Commercial | | | Broadband | | | Operations | | | Totals | | | Consumer | | | Access | | | Commercial | | | Broadband | | | Operations | | | Totals | |
| Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice | | $ | 27,377 | | | | 11,911 | | | | 14,913 | | | | - | | | | 10,968 | | | | 65,169 | | | $ | 29,110 | | | | 13,835 | | | | 16,291 | | | | - | | | | 11,667 | | | | 70,903 | |
| Video | | | 59,885 | | | | - | | | | 5,776 | | | | - | | | | - | | | | 65,661 | | | | 58,376 | | | | - | | | | 4,956 | | | | - | | | | - | | | | 63,332 | |
| Data | | | 33,958 | | | | 29,995 | | | | 40,613 | | | | 28,634 | | | | - | | | | 133,200 | | | | 28,734 | | | | 32,152 | | | | 34,333 | | | | 22,472 | | | | - | | | | 117,691 | |
| Wireless | | | 55,751 | | | | 8,342 | | | | 4,743 | | | | - | | | | - | | | | 68,836 | | | | 51,297 | | | | 7,308 | | | | 4,214 | | | | - | | | | - | | | | 62,819 | |
| Total | | | 176,971 | | | | 50,248 | | | | 66,045 | | | | 28,634 | | | | 10,968 | | | | 332,866 | | | | 167,517 | | | | 53,295 | | | | 59,794 | | | | 22,472 | | | | 11,667 | | | | 314,745 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cost of goods sold | | | 55,319 | | | | 13,241 | | | | 31,798 | | | | 8,494 | | | | 2,218 | | | | 111,070 | | | | 51,825 | | | | 12,907 | | | | 27,468 | | | | 6,378 | | | | 2,083 | | | | 100,661 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Contribution | | | 121,652 | | | | 37,007 | | | | 34,247 | | | | 20,140 | | | | 8,750 | | | | 221,796 | | | | 115,692 | | | | 40,388 | | | | 32,326 | | | | 16,094 | | | | 9,584 | | | | 214,084 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Less SG&A | | | 66,664 | | | | 13,348 | | | | 20,769 | | | | 8,980 | | | | 6,829 | | | | 116,590 | | | | 59,611 | | | | 15,741 | | | | 18,324 | | | | 8,261 | | | | 6,024 | | | | 107,961 | |
| Less other | | | - | | | | - | | | | - | | | | 33 | | | | - | | | | 33 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| EBITDA | | | 54,988 | | | | 23,659 | | | | 13,478 | | | | 11,127 | | | | 1,921 | | | | 105,173 | | | | 56,081 | | | | 24,647 | | | | 14,002 | | | | 7,833 | | | | 3,560 | | | | 106,123 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Add share-based compensation | | | 1,514 | | | | 514 | | | | 542 | | | | 270 | | | | - | | | | 2,840 | | | | 1,208 | | | | 570 | | | | 423 | | | | 245 | | | | - | | | | 2,446 | |
| Add accretion | | | 149 | | | | 51 | | | | 43 | | | | 23 | | | | - | | | | 266 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Add other | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (82 | ) | | | (39 | ) | | | (24 | ) | | | (15 | ) | | | - | | | | (160 | ) |
| Adjusted EBITDA | | $ | 56,651 | | | | 24,224 | | | | 14,063 | | | | 11,420 | | | | 1,921 | | | | 108,279 | | | $ | 57,207 | | | | 25,178 | | | | 14,401 | | | | 8,063 | | | | 3,560 | | | | 108,409 | |
| GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
| KEY PERFORMANCE INDICATORS |
| (Unaudited) |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | June 30, 2011 | | | June 30, 2011 | |
| | | | | | | | | | | | as compared to | | | as compared to | |
| | | June 30, | | | June 30, | | | March 31, | | | June 30, | | | March 31, | | | June 30, | | | March 31, | |
| | | 2011 | | | 2010 | | | 2011 | | | 2010 | | | 2011 | | | 2010 | | | 2011 | |
| Consumer | | | | | | | | | | | | | | | | | | | | | |
| Voice | | | | | | | | | | | | | | | | | | | | | |
| Long-distance subscribers | | | 84,600 | | | | 90,200 | | | | 87,900 | | | | (5,600 | ) | | | (3,300 | ) | | | -6.2 | % | | | -3.8 | % |
Total local access lines in service | | | 82,300 | | | | 85,100 | | | | 85,100 | | | | (2,800 | ) | | | (2,800 | ) | | | -3.3 | % | | | -3.3 | % |
Local access lines in service on GCI facilities | | | 75,900 | | | | 77,100 | | | | 78,000 | | | | (1,200 | ) | | | (2,100 | ) | | | -1.6 | % | | | -2.7 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Video | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Basic subscribers | | | 126,900 | | | | 131,200 | | | | 130,200 | | | | (4,300 | ) | | | (3,300 | ) | | | -3.3 | % | | | -2.5 | % |
Digital programming tier subscribers | | | 77,400 | | | | 80,600 | | | | 81,600 | | | | (3,200 | ) | | | (4,200 | ) | | | -4.0 | % | | | -5.1 | % |
| HD/DVR converter boxes | | | 87,700 | | | | 86,500 | | | | 89,300 | | | | 1,200 | | | | (1,600 | ) | | | 1.4 | % | | | -1.8 | % |
| Homes passed | | | 239,000 | | | | 234,700 | | | | 239,000 | | | | 4,300 | | | | - | | | | 1.8 | % | | | 0.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cable modem subscribers | | | 105,400 | | | | 103,500 | | | | 107,200 | | | | 1,900 | | | | (1,800 | ) | | | 1.8 | % | | | -1.7 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Wireless | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Wireless lines in service | | | 126,400 | | | | 119,000 | | | | 126,500 | | | | 7,400 | | | | (100 | ) | | | 6.2 | % | | | -0.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Network Access Services | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total ISP access lines in service | | | 1,600 | | | | 1,700 | | | | 1,700 | | | | (100 | ) | | | (100 | ) | | | -5.9 | % | | | -5.9 | % |
Total ISP access lines in service on GCI facilities | | | 1,400 | | | | 1,400 | | | | 1,300 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Long-distance subscribers | | | 9,100 | | | | 9,400 | | | | 9,100 | | | | (300 | ) | | | - | | | | -3.2 | % | | | 0.0 | % |
Total local access lines in service | | | 49,100 | | | | 48,000 | | | | 48,700 | | | | 1,100 | | | | 400 | | | | 2.3 | % | | | 0.8 | % |
Local access lines in service on GCI facilities | | | 25,600 | | | | 20,600 | | | | 25,200 | | | | 5,000 | | | | 400 | | | | 24.3 | % | | | 1.6 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Video | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Hotels and mini-headend subscribers | | | 18,300 | | | | 18,500 | | | | 15,200 | | | | (200 | ) | | | 3,100 | | | | -1.1 | % | | | 20.4 | % |
| Basic subscribers | | | 2,000 | | | | 1,800 | | | | 2,000 | | | | 200 | | | | - | | | | 11.1 | % | | | 0.0 | % |
| Total basic subscribers | | | 20,300 | | | | 20,300 | | | | 17,200 | | | | - | | | | 3,100 | | | | 0.0 | % | | | 18.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cable modem subscribers | | | 11,000 | | | | 10,800 | | | | 10,800 | | | | 200 | | | | 200 | | | | 1.9 | % | | | 1.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Wireless | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Wireless lines in service | | | 14,600 | | | | 12,200 | | | | 13,700 | | | | 2,400 | | | | 900 | | | | 19.7 | % | | | 6.6 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Regulated Operations | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total local access lines in service | | | 9,400 | | | | 10,600 | | | | 9,800 | | | | (1,200 | ) | | | (400 | ) | | | -11.3 | % | | | -4.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | June 30, 2011 | | | June 30, 2011 |
| | | Three Months Ended | | | as Compared to | | | as Compared to | |
| | | June 30, | | | June 30, | | | March 31, | | | June 30, | | | March 31, | | | June 30, | | | March 31, | |
| | | | 2011 | | | | 2010 | | | | 2011 | | | | 2010 | | | | 2011 | | | | 2010 | | | | 2011 | |
| Consumer | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Long-distance minutes carried (in millions) | | | 23.2 | | | | 26.7 | | | | 24.4 | | | | (3.5 | ) | | | (1.2 | ) | | | -13.1 | % | | | -4.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Video | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average monthly gross revenue per subscriber | | $ | 76.47 | | | $ | 74.54 | | | $ | 77.60 | | | $ | 1.93 | | | $ | (1.13 | ) | | | 2.6 | % | | | -1.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Wireless | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average monthly gross revenue per subscriber | | $ | 70.52 | | | $ | 75.07 | | | $ | 69.46 | | | $ | (4.55 | ) | | $ | 1.06 | | | | -6.1 | % | | | 1.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Network Access Services | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Long-distance minutes carried (in millions) | | | 187.5 | | | | 201.3 | | | | 190.7 | | | | (13.8 | ) | | | (3.2 | ) | | | -6.9 | % | | | -1.7 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Voice: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Long-distance minutes carried (in millions) | | | 28.0 | | | | 29.4 | | | | 28.3 | | | | (1.4 | ) | | | (0.3 | ) | | | -4.8 | % | | | -1.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Long-distance minutes carried (in millions) | | | 238.7 | | | | 257.4 | | | | 243.4 | | | | (18.7 | ) | | | (4.7 | ) | | | -7.3 | % | | | -1.9 | % |
General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)
| | | Three Months Ended | |
| | | June 30, 2011 | | | June 30, 2010 | | | March 31, 2011 | |
| Net income (loss) | | $ | (2.0 | ) | | | 1.9 | | | | 1.5 | |
| Income tax expense (benefit) | | | (2.0 | ) | | | 5.5 | | | | 1.4 | |
| Income (loss) before income tax expense (benefit) | | | (4.0 | ) | | | 7.4 | | | | 2.9 | |
| | | | | | | | | | | | | |
| Other expense: | | | | | | | | | | | | |
Interest expense (including amortization of deferred loan fees) | | | 17.3 | | | | 17.8 | | | | 17.5 | |
| Interest income | | | --- | | | | (0.1 | ) | | | --- | |
| Loss on extinguishment of debt | | | 9.1 | | | | --- | | | | --- | |
| Other expense, net | | | 26.4 | | | | 17.7 | | | | 17.5 | |
| | | | | | | | | | | | | |
| Operating income | | | 22.4 | | | | 25.1 | | | | 20.4 | |
| Depreciation and amortization expense | | | 30.6 | | | | 30.8 | | | | 31.7 | |
| | | | | | | | | | | | | |
| EBITDA (Note 2) | | | 53.0 | | | | 55.9 | | | | 52.1 | |
| Share-based compensation | | | 1.7 | | | | 1.6 | | | | 1.1 | |
| Accretion | | | 0.2 | | | | --- | | | | 0.1 | |
| Non-cash contribution adjustment | | | --- | | | | (0.1 | ) | | | --- | |
| Adjusted EBITDA (Note 1) | | $ | 54.9 | | | | 57.4 | | | | 53.3 | |
General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)
| | | | | | | |
| | | Six Months Ended | |
| | | June 30, 2011 | | | June 30, 2010 | |
| Net income (loss) | | $ | (0.5 | ) | | | 3.6 | |
| Income tax expense (benefit) | | | (0.5 | ) | | | 5.3 | |
| Income (loss) before income tax expense (benefit) | | | (1.0 | ) | | | 8.9 | |
| | | | | | | | | |
| Other (income) expense: | | | | | | | | |
Interest expense (including amortization of deferred loan fees) | | | 34.8 | | | | 35.4 | |
| Interest income | | | --- | | | | (0.1 | ) |
| Loss on extinguishment of debt | | | 9.1 | | | | --- | |
| Other expense, net | | | 43.9 | | | | 35.3 | |
| | | | | | | | | |
| Operating income | | | 42.9 | | | | 44.2 | |
| Depreciation and amortization expense | | | 62.3 | | | | 61.9 | |
| | | | | | | | | |
| EBITDA (Note 2) | | | 105.2 | | | | 106.1 | |
| Share-based compensation | | | 2.8 | | | | 2.4 | |
| Accretion | | | 0.3 | | | | --- | |
| Non-cash contribution adjustment | | | --- | | | | (0.1 | ) |
| Adjusted EBITDA (Note 1) | | $ | 108.3 | | | | 108.4 | |
Notes:
| | (1) EBITDA (as defined in Note 2 below) before deducting share-based compensation and accretion expense. |
| | (2) Earnings Before Interest, Taxes, Depreciation and Amortization is the sum of Net Income, Interest Expense (including Amortization of Deferred Loan Fees), Interest Income, Income Tax Expense, 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 does 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. |
