Exhibit 99.3 PRESS RELEASE Contact Information Ed Babcock Adelphia Business Solutions 814-274-9830 FOR IMMEDIATE RELEASE: - --------------------- ADELPHIA BUSINESS SOLUTIONS, INC ANNOUNCES FOURTH QUARTER AND ANNUAL RESULTS OF OPERATIONS Coudersport, PA - March 1, 2000 John J. Rigas, Chairman of Adelphia Communications Corporation ("Adelphia") (NASDAQ NNM: ADLAC) and Adelphia Business Solutions, Inc. (formerly Hyperion Telecommunications, Inc. ) ("the Company") (NASDAQ NNM: ABIZ) reported results of operations for the Company and its Operating Companies (defined in footnote) for the fourth quarter and year which ended on December 31, 1999. Fourth quarter results saw record levels of consolidated operating revenues of $55.6 million, and record access line installations of 80,202. For the year 1999, consolidated operating revenues were a record $154.6 million, or 290% higher than the previous year. Furthermore, the Company's Original Markets (defined in Table 2) achieved positive EBITDA in the fourth quarter of $12.9 million, while overall Company and Operating Company EBITDA losses in the December 1999 quarter increased slightly to $11.5 million as compared with the September 1999 quarter EBITDA loss of $9.7 million. Net loss applicable to common shareholders for the fourth quarter totaled $60.8 million, or $1.01 per share, compared with $36.9 million, or $0.60 per share, for the same period in the prior year. The Company now offers communications services in 53 markets in the eastern half of the United States with plans to expand to a total of 200 markets throughout the United States by the end of 2001. Summarized financial results are included in Tables 1, 2 and 3 below. As presented in Table 1, on a sequential quarterly basis, consolidated revenues increased 28.2% to $55.6 million in the December 1999 quarter, from $43.3 million in the September 1999 quarter and were 182.2% higher than the comparable period in the prior year. Gross margin as a percent of sales was 59.5% in the December 1999 quarter as compared with 63.4% of sales in the September 1999 quarter. EBITDA losses for the December 1999 quarter were slightly higher at $15.9 million versus a $12.5 million EBITDA loss in the September 1999 quarter. The lower gross margin percent and higher EBITDA losses were in line with the Company's expectations and are a direct result of its expansion efforts. Additionally, the Company's joint ventures in the four markets in which the Company is a 50% partner continued to demonstrate improved financial results, with EBITDA margins as a percent of sales of 38.1% in the December 1999 quarter versus 29.3% in the September 1999 quarter. As presented in Table 3, for the year ended December 31, 1999, consolidated operating revenues totaled $154.6 million, a 290% increase over prior year revenues. EBITDA losses for 1999 totaled $46.6 million as compared with EBITDA losses of $22.2 million in 1998, as the Company continues to expand its market presence nationwide. Table 2 presents the Company's financial results of operations for the 22 Original Markets and the Company's current expansion into its New Markets (defined in Table 2). The Original Markets' sequential quarterly revenue growth remained very strong, to $60.6 million in the December 1999 quarter, or 22.4% higher than the September 1999 quarter. Furthermore, gross margin as a percent of sales in the Original Markets maintained a strong 73.0% in the December 1999 quarter as the Company continued to provision most of its lines completely on its own network and as data revenues began to increase in its Original Markets. The Original Markets' EBITDA increased by $3.0 million to $12.9 million, or 21.3% of revenues in the December 1999 quarter, a 30.7% sequential quarterly increase over the September 1999 quarter. New Markets' revenues nearly doubled to $6.5 million in the December 1999 quarter from $3.3 million in the September 1999 quarter as these markets continue to expand operations. New Markets' EBITDA losses increased to $24.4 million for the December 1999 quarter from a loss of $19.6 million in the September 1999 quarter as the markets continue to develop. Access lines installed increased by 80,202, resulting in an installed access line base of 331,007 as of December 31, 1999, 55% of which are serviced on the Company's switches. Access lines sold as of December 31, 1999 totaled 360,205, an increase of 87,570 in the quarter. During the December 1999 quarter, the Company and its consolidated subsidiaries invested approximately $220 million in capital expenditures. The increased capital expenditures versus previous quarters relates primarily to the nationwide network development efforts for fiber, dense wave division multiplexing and DSL equipment. During the quarter, the Company's accounts payable increased by approximately $130 million, as many of these capital expenditures are on long term vendor payment terms. For the year, capital expenditures totaled approximately $450 million as the Company expanded its market presence nationwide. As of December 31, 1999, total gross property, plant and equipment of the Company and its consolidated subsidiaries was approximately $1,040 million. As of December 31, 1999, the Operating Companies had approximately 7,088 local route miles and 320,450 local fiber miles operational. The Company also has 28,000 route miles of long haul fiber and over 3,000 route miles of local fiber network under construction or being purchased under several fiber and conduit contracts which will be delivered over the next 3 to 18 months. At year end, the Company had customers located in approximately 20,225 buildings, of which approximately 2,200 buildings were connected with Company-owned fiber, and was collocated in 167 local exchange carrier central offices. The Company will be significantly expanding its collocation efforts during calendar 2000 through the deployment of DSL equipment in over 500 central offices, all of which will be connected with Company owned fiber. Additionally, to date, 22 Lucent 5ESS switches or remote switching modules have been installed to provide local telephone service with nine additional regional switches planned for operation during the first half of 2000. Adelphia Business Solutions is a majority owned subsidiary of Adelphia Communications Corporation that provides integrated communications services to business customers through its state-of-the-art fiber optic communications network. As a result of its consolidation efforts, the Company now owns 100% of the interests in 49 of 53 markets in which it currently offers communications services, with the remaining four markets operating as 50% owned joint ventures with a local partner. By the end of 2001, the Company expects to serve 200 markets throughout the United States including substantially all major Tier I and Tier II cities, through the interconnection of these markets, creating a single fiber optic backbone network. This fully redundant, 33,000-mile long-haul fiber optic network, combined with an estimated 15,000 local fiber route miles, will support the Company's full line of communication service offerings, including local and long distance voice services, messaging, high-speed data and internet services. For more information on Adelphia Business Solutions, or to review an electronic version of this press release visit the Company's web site at http://www.adelphia-abs.com Footnote: The Company's Operating Companies represent four partnerships or limited liability companies with local partners, and all wholly or majority owned subsidiaries of the Company (collectively, the "Operating Companies"). Certain statements in this release are forward-looking statements that are subject to material risks and uncertainties. Actual results could differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with the Company's business, which include among others, competitive developments, risks associated with the Company's growth and financings, the development of the Company's markets, regulatory risks, dependence on its customers and their spending patterns and other risks which are discussed in the Company's filings with the Securities and Exchange Commission. Additional information regarding factors that may affect the business and financial results of Adelphia Business Solutions can be found in the Company's filings with the Securities and Exchange Commission, including the prospectus under Registration Statement File No. 333-11142 (formerly No. 333-88927), under the caption "Risk Factors." Adelphia Business Solutions, Inc. Table 1 - Unaudited Proforma Consolidated and Joint Venture Operating Results Quarter ended December 31, 1999 Quarter ended September 30, 1999 Quarter ended December 31, 1998 ------------------------------------------------------------------------------------------------------ Joint Joint Pro-forma Joint Consolidated Venture Total Consolidated Venture Total Consolidated Venture Total (dollars in thousands) Operating Operating Operating Operating Operating Operating Operating Operating Operating Results Results Results Results Results Results Results Results Results ----------------------------------------------------------------------------------------------------- Revenues $ 55,575 $ 11,479 $ 67,054 $ 43,347 $ 9,501 $ 52,848 $ 19,690 $ 5,128 $ 24,818 Direct Operating Expenses 22,488 2,243 24,731 15,862 2,526 18,388 8,145 2,506 10,651 ----------------------------------------------------------------------------------------------------- Gross Margin 33,087 9,236 42,323 27,485 6,975 34,460 11,545 2,622 14,167 Gross Margin Percentage 59.5% 80.5% 63.1% 63.4% 73.4% 65.2% 58.6% 51.1% 57.1% Sales, General and Administrative Expenses 48,997 4,860 53,857 39,972 4,194 44,166 18,273 4,291 22,564 ----------------------------------------------------------------------------------------------------- EBITDA (a) (15,910) 4,376 (11,534) (12,487) 2,781 (9,706) (6,728) (1,669) (8,397) ----------------------------------------------------------------------------------------------------- EBITDA Percentage of Revenues (28.6%) 38.1% (17.2%) (28.8%) 29.3% (18.4%) (34.2%) (32.5%) (33.8%) December 1999 Quarter vs. December 1999 Quarter vs. September 1999 Quarter December 1998 Quarter ------------------------------------------------------------------------- Joint Pro-forma Joint Percent Change Comparison Consolidated Venture Total Consolidated Venture Total Operating Operating Operating Operating Operating Operating Results Results Results Results Results Results ------------------------------------------------------------------------- Revenues 28.2% 20.8% 26.9% 182.2% 123.8% 170.2% Direct Operating Expenses 41.8% (11.2%) 34.5% 176.1% (10.5%) 132.2% ------------------------------------------------------------------------- Gross Margin 20.4% 32.4% 22.8% 186.6% 252.3% 198.7% Sales, General and Administrative 22.6% 15.9% 21.9% 168.1% 13.3% 138.7% ------------------------------------------------------------------------- EBITDA (a) (27.4%) 57.4% (18.8%) (135.6%) NM (37.4%) ------------------------------------------------------------------------- Table 1 summarizes operating results for (i) Adelphia Business Solutions and its consolidated subsidiaries and (ii) its non-consolidated joint ventures. All prior period operating results have been presented on a pro-forma basis, adjusted for the consolidation of the Richmond, Jacksonville and Wichita markets as if Adelphia Business Solutions' purchase of its partners' interests in these markets had occurred at the beginning of each period presented. (a) Earnings before interest, income taxes, depreciation and amortization and other income/expense ("EBITDA") and similar measures of cash flow are commonly used in the telecommunications industry to analyze and compare telecommunications companies on the basis of operating performance, leverage, and liquidity. While EBITDA is not an alternative indicator of operating performance or an alternative to cash flows from operating activities as a measure of liquidity as defined by GAAP, and while EBITDA may not be comparable to other similarly titled measures of other companies, management of Adelphia Business Solutions believes that EBITDA is a meaningful measure of performance. Adelphia Business Solutions, Inc. Table 2 - Unaudited Original Markets and New Markets Operating Results (dollars in thousands) Quarter ended December 31, 1999 Quarter Ended September 30, 1999 Quarter ended December 31, 1998 ------------------------------------------------------------------------------------------------------ Original New Total Original New Total Original New Total Markets Markets Operating Markets Markets Operating Markets Markets Operating Results Results Results Results Results Results Results Results Results ------------------------------------------------------------------------------------------------------ Revenues $ 60,590 $ 6,464 $ 67,054 $ 49,513 $ 3,335 $ 52,848 $ 24,622 $ 196 $ 24,818 Direct Operating Expenses 16,348 8,383 24,731 14,924 3,464 18,388 9,343 314 9,657 ------------------------------------------------------------------------------------------------------ Gross Margin 44,242 (1,919) 42,323 34,589 (129) 34,460 15,279 (118) 15,161 Gross Margin Percentage 73.0% (29.7%) 63.1% 69.9% (3.9%) 65.2% 62.1% (60.2%) 61.1% Sales, General and Administrative Expenses 25,199 14,729 39,928 18,289 13,305 31,594 14,604 2,125 16,729 Allocated Corporate Overhead Expense 6,129 7,800 13,929 6,421 6,152 12,573 6,144 685 6,829 ----------------------------------------------------------------------------------------------------- EBITDA (a) 12,914 (24,448) (11,534) 9,879 (19,586) (9,707) (5,469) (2,928) (8,397) ----------------------------------------------------------------------------------------------------- EBITDA Percentage of Revenues 21.3% (378.2%) (17.2%) 20.0% (587.3%) (18.4%) (22.2%) (1.9%) (33.8%) December 1999 Quarter vs. December 1999 Quarter vs. September 1999 Quarter December 1998 Quarter ------------------------------------------------------------------------ Original New Total Original New Total Percent Change Comparison Markets Markets Operating Markets Markets Operating Results Results Results Results Results Results ------------------------------------------------------------------------ Revenues 22.4% 93.8% 26.9% 146.1% NM 170.2% Direct Operating Expenses 9.5% 142.0% 34.5% 75.0% NM 156.1% ------------------------------------------------------------------------ Gross Margin 27.9% 1387.6% 22.8% 189.6% NM 179.2% Sales, General and Administrative Expenses 37.8% 10.7% 26.4% 72.5% NM 138.7% Allocated Corporate Overhead (4.5%) 26.8% 10.8% (0.2%) NM 104.0% ------------------------------------------------------------------------ EBITDA (a) 30.7% (24.8%) 18.8% NM NM 37.4% ------------------------------------------------------------------------ Table 2 summarizes operating results for (i) Adelphia Business Solutions' 22 Original Markets which were in operation or under construction when Adelphia Business Solutions completed its initial public offering in May 1998 and (ii) the additional markets which were operational or under development subsequent to May 1998, as a result of Adelphia Business Solutions' geographic expansion in the eastern half of the United States, (the "New Markets"). Corporate overhead has been allocated on the basis of the number of markets in services or under development for each period presented. (a) Earnings before interest, income taxes, depreciation and amortization and other income/expense ("EBITDA") and similar measures of cash flow are commonly used in the telecommunications industry to analyze and compare telecommunications companies on the basis of operating performance, leverage, and liquidity. While EBITDA is not an alternative indicator of operating performance or an alternative to cash flows from operating activities as a measure of liquidity as defined by GAAP, and while EBITDA may not be comparable to other similarly titled measures of other companies, management of Adelphia Business Solutions believes that EBITDA is a meaningful measure of performance. ADELPHIA BUSINESS SOLUTIONS, INC. AND SUBSIDIARIES TABLE 3 - CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Amounts in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, December 31, -------------------------------- ----------------------------- 1998 1999 1998 1999 ----------------- -------------- --------------- ------------- Revenues $ 15,043 $ 55,575 $ 39,596 $ 154,575 ----------------- -------------- --------------- -------------- Operating expenses: Network operations 6,664 22,488 21,250 58,525 Selling, general and administrative 16,518 48,997 40,556 142,615 Depreciation and amortization 10,708 19,955 31,121 65,244 ----------------- -------------- --------------- -------------- Total 33,890 91,440 92,927 266,384 ----------------- -------------- --------------- -------------- Operating loss (18,847) (35,865) (53,331) (111,809) Other income (expense): Interest income 1,829 288 15,586 19,933 Interest income-affiliate 3,576 1,540 8,395 8,483 Interest expense (12,399) (17,931) (52,038) (74,314) Other income --- --- 1,113 --- ----------------- -------------- --------------- -------------- Loss before income taxes and equity in net loss of joint ventures (25,841) (51,968) (80,275) (157,707) Income tax expense --- 3 --- (1) ----------------- -------------- --------------- -------------- Loss before equity in net loss of joint ventures (25,841) (51,965) (80,275) (157,708) Equity in net loss of joint ventures (3,776) (418) (13,263) (7,758) ----------------- -------------- --------------- -------------- Loss before extraordinary gain (29,617) (52,383) (93,538) (165,466) Extraordinary gain on repurchase of debt --- --- 237 --- ----------------- -------------- --------------- -------------- Net loss (29,617) (52,383) (93,301) (165,466) Dividend requirements applicable to preferred stock (7,284) (8,450) (27,732) (31,618) ----------------- -------------- --------------- -------------- Net loss applicable to common stockholders $ (36,901) $ (60,833) $ (121,033) $ (197,084) ================= ============== =============== ============== Basic and diluted net loss per weighted average share of common stock $ (0.60) $ (1.01) $ (2.49) $ (3.47) ================= ============== =============== ============== Weighted average shares of common stock outstanding 55,497 60,453 48,594 56,739 ================= ============== =============== ==============