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Mediacom Communications Reports Combined Results for First Quarter 2016

MEDIACOM PARK, N.Y.--()--MEDIACOM COMMUNICATIONS CORPORATION today released combined unaudited financial and operating highlights for the three months ended March 31, 2016.

Mediacom Combined Results for First Quarter 2016*

  • Revenues were $444.8 million, reflecting a 5.9% increase from the prior year period
  • OIBDA was $169.1 million, reflecting a 6.7% increase from the prior year period
  • Capital expenditures were $78.6 million, compared to $63.0 million in the prior year period
  • Free cash flow was $59.1 million, compared to $58.1 million in the prior year period
  • Ending primary service units ("PSUs") of 2,411,000, a 2.9% increase from March 31, 2015
  • Ending customer relationships of 1,333,000, a 2.8% increase from March 31, 2015
  • Total leverage ratio of 4.36x, compared to 4.98x at March 31, 2015
  • Interest coverage ratio of 5.38x, compared to 4.24x for the prior year period
  • Ending total debt of $2,950.0 million, a $210.0 million reduction from March 31, 2015

Reference to "Mediacom Combined" reflects the combined results of Mediacom Broadband LLC and Mediacom LLC, eliminating intercompany amounts. The Mediacom Combined information is being provided for convenience and informational purposes only, and does not modify or supplement the previously released separate financial results of Mediacom Broadband LLC and Mediacom LLC. Holders of Mediacom Broadband LLC or Mediacom LLC debt should refer to the separate financial and operating results for each company, which were previously released and furnished with the Securities and Exchange Commission on Form 8-K on May 3, 2016.

About Mediacom

Mediacom Communications Corporation is the eighth largest cable operator in the U.S. serving about 1.3 million customers in smaller markets primarily in the Midwest and Southeast through its wholly-owned subsidiaries, Mediacom Broadband LLC and Mediacom LLC. Mediacom offers a wide array of information, communications and entertainment services to households and businesses, including video, high-speed data, phone, and home security and automation. Through Mediacom Business, the company provides innovative broadband solutions to commercial and public sector customers of all sizes, and sells advertising and production services under the OnMedia brand. More information about Mediacom is available at www.mediacomcc.com.

TABLE 1*

Mediacom Communications Corporation

Selected Combined Financial and Operating Data

(Dollars in thousands, except per unit data)

(Unaudited)

Three Months Ended
March 31,
2016 2015YoY% Change
Video

$

199,393

$ 199,661 (0.1 %)
High-speed data 145,094 128,044 13.3 %
Phone 27,408 28,773 (4.7 )%
Business services 55,739 50,181 11.1 %
Advertising 17,153 13,338 28.6 %
Total revenues$444,787$419,9975.9%
Service costs (189,426 ) (180,869 ) 4.7 %
SG&A expenses (77,308 ) (72,619 ) 6.5 %
Management fees (9,000 ) (8,000 ) 12.5 %
OIBDA (a)$169,053$158,5096.7%
Cash interest expense (a) (31,415 ) (37,420 ) (16.0 )%
Capital expenditures (b) (78,563 ) (62,990 ) 24.7 %
Free cash flow (a)$59,075 $58,099 1.7%
OIBDA margin (c) 38.0 % 37.7 %
March 31, 2016March 31, 2015YoY% Change
Video customers 853,000 891,000 (4.3 )%
High-speed data ("HSD") customers 1,114,000 1,041,000 7.0 %
Phone customers 444,000 411,000 8.0 %
Primary service units ("PSUs")2,411,0002,343,0002.9%
Video customer (declines) increases (2,000 ) 1,000
HSD customer increases 29,000 28,000
Phone customer increases 11,000 11,000
Quarterly PSU increases38,00040,000
Customer relationships (d) 1,333,000 1,297,000 2.8 %
Average total monthly revenue per:
PSU (e) $ 61.98 $ 60.27 2.8 %
Customer relationship (f) $ 111.90 $ 108.69 3.0 %
March 31, 2016March 31, 2015
Bank credit facility $ 2,200,000 $ 2,410,000
5½% senior notes due 2021 200,000 200,000
7¼% senior notes due 2022 250,000 250,000
6⅜% senior notes due 2023 300,000 300,000
Total debt (g)$2,950,000$3,160,000
Total leverage ratio (h) 4.36x 4.98x
Interest coverage ratio (i) 5.38x 4.24x
*

See Table 4 for information about our use of non-GAAP measures and definitions of OIBDA and free cash flow, and Table 5 for footnotes.

TABLE 2*

Mediacom Communications Corporation

Selected Combined Financial and Operating Data

(Dollars in thousands, except per unit data)

(Unaudited)

Three Months Ended
March 31, 2016

Mediacom
Broadband

Mediacom
LLC

Eliminations

Mediacom
Combined

Video

$

112,702

$ 86,691 $ 199,393
High-speed data 80,037 65,057 145,094
Phone 14,562 12,846 27,408
Business services 34,034 21,705 55,739
Advertising 13,883 3,270 17,153
Total revenues$255,218$189,569$444,787
Service costs (104,475 ) (84,951 ) (189,426 )
SG&A expenses (46,968 ) (30,340 ) (77,308 )
Management fees (5,350 ) (3,650 ) (9,000 )
OIBDA (a)$98,425$70,628$169,053
Investment income from affiliate 4,500

(4,500

)

Adjusted OIBDA (a)$98,425$75,128

(4,500

)

$169,053
Cash interest expense (a) (19,079 ) (12,336 ) (31,415 )
Capital expenditures (b) (42,345 ) (36,218 ) (78,563 )
Dividend to preferred members (4,500 )

4,500

Free cash flow (a)$32,501 $26,574 $59,075

Mediacom
Broadband

Mediacom
LLC

Mediacom
Combined

Video customers 479,000 374,000 853,000
HSD customers 621,000 493,000 1,114,000
Phone customers 245,000 199,000 444,000
Primary service units ("PSUs")1,345,0001,066,0002,411,000
Video customer declines (1,000 ) (1,000 ) (2,000 )
HSD customer increases 16,000 13,000 29,000
Phone customer increases 6,000 5,000 11,000
Quarterly PSU increases21,00017,00038,000
Customer relationships (d) 740,000 593,000 1,333,000
Average total monthly revenue per:
PSU (e) $ 63.75 $ 59.75 $ 61.98
Customer relationship (f) $ 115.59 $ 107.28 $ 111.90

Mediacom
Broadband

Mediacom
LLC

Mediacom
Combined

Bank credit facility $ 1,280,000 $ 920,000 $ 2,200,000
5½% senior notes due 2021 200,000 200,000
7¼% senior notes due 2022 250,000 250,000
6⅜% senior notes due 2023 300,000 300,000
Total debt (g)$1,780,000$1,170,000$2,950,000
Total leverage ratio (h) 4.52x 3.89x 4.36x
Interest coverage ratio (i) 5.16x 6.09x 5.38x
*

See Table 4 for information about our use of non-GAAP measures and definitions of OIBDA and free cash flow, and Table 5 for footnotes.

TABLE 3*

Mediacom Communications Corporation

Selected Combined Financial and Operating Data

(Dollars in thousands, except per unit data)

(Unaudited)

Three Months Ended
March 31, 2015

Mediacom
Broadband

Mediacom
LLC

Eliminations

Mediacom
Combined

Video

$

113,370

$ 86,291 $ 199,661
High-speed data 70,601 57,443 128,044
Phone 15,232 13,541 28,773
Business services 30,598 19,583 50,181
Advertising 10,152 3,186 13,338
Total revenues$239,953$180,044$419,997
Service costs (100,225 ) (80,644 ) (180,869 )
SG&A expenses (43,775 ) (28,844 ) (72,619 )
Management fees (4,750 ) (3,250 ) (8,000 )
OIBDA (a)$91,203$67,306$158,509
Investment income from affiliate 4,500 (4,500 )
Adjusted OIBDA (a)$91,203$71,806 (4,500 ) $158,509
Cash interest expense (a) (22,164 ) (15,256 ) (37,420 )
Capital expenditures (b) (34,410 ) (28,580 ) (62,990 )
Dividend to preferred members (4,500 ) 4,500
Free cash flow (a)$30,129 $27,970 $58,099

Mediacom
Broadband

Mediacom
LLC

Mediacom
Combined

Video customers 502,000 389,000 891,000
HSD customers 581,000 460,000 1,041,000
Phone customers 225,000 186,000 411,000
Primary service units ("PSUs")1,308,0001,035,0002,343,000
Video customer increases (declines) 2,000 (1,000 ) 1,000
HSD customer increases 17,000 11,000 28,000
Phone customer increases 7,000 4,000 11,000
Quarterly PSU increases26,00014,00040,000
Customer relationships (d) 719,000 578,000 1,297,000
Average total monthly revenue per:
PSU (e) $ 61.76 $ 58.38 $ 60.27
Customer relationship (f) $ 111.94 $ 104.65 $ 108.69

Mediacom
Broadband

Mediacom
LLC

Mediacom
Combined

Bank credit facility $ 1,422,000 $ 988,000 $ 2,410,000
5½% senior notes due 2021 200,000 200,000
7¼% senior notes due 2022 250,000 250,000
6⅜% senior notes due 2023 300,000 300,000
Total debt (g)$1,922,000$1,238,000$3,160,000
Total leverage ratio (h) 5.27x 4.31x 4.98x
Interest coverage ratio (i) 4.11x 4.71x 4.24x
*

See Table 4 for information about our use of non-GAAP measures and definitions of OIBDA and free cash flow, and Table 5 for footnotes.

TABLE 4

Use of Non-GAAP Financial Measures

"OIBDA," "Adjusted OIBDA," "cash interest expense" and "free cash flow" are not financial measures calculated in accordance with generally accepted accounting principles ("GAAP") in the United States. We define OIBDA as operating income before depreciation and amortization and Adjusted OIBDA as OIBDA plus investment income from affiliate. OIBDA and Adjusted OIBDA may not be comparable to similarly titled measures used by other companies, which may have different depreciation and amortization policies, and are key components in our covenant calculations.
We define cash interest expense as interest expense, net, less amortization of deferred financing costs. Cash interest expense excludes the amortization of financing costs which were paid upon the financing of the relevant debt.
For Mediacom Broadband LLC, we define free cash flow as OIBDA less capital expenditures, cash interest expense and dividends to preferred members. For Mediacom LLC, we define free cash flow as Adjusted OIBDA less capital expenditures and cash interest expense. Free cash flow may not be comparable to similarly titled measures reported by other companies.

TABLE 5
Footnotes

(a) See Table 4 for information regarding our use of non-GAAP financial measures.
(b) Capital expenditures for the three months ended March 31, 2016 exclude changes in accrued property, plant and equipment, which represented a cash source of $1.1 million and a cash use of $0.9 million at Mediacom Broadband LLC and Mediacom LLC, respectively. Capital expenditures for the three months ended March 31, 2015 exclude changes in accrued property, plant and equipment, which represented a cash use of $0.1 million and a cash source of $0.6 million for Mediacom Broadband LLC and Mediacom LLC, respectively.
(c) Represents OIBDA as a percentage of total revenues.
(d) Represents the total number of customers that take at least one service, without regard to which service(s) customers purchase.
(e) Represents average total monthly revenues for the quarter divided by average PSUs for such quarter.
(f) Represents average total monthly revenues for the quarter divided by average customer relationships for such quarter.
(g) Total debt excludes the effect of deferred financing costs, net.
(h) For Mediacom Combined and Mediacom Broadband LLC, represents total debt at quarter end divided by annualized OIBDA for the quarter. For Mediacom LLC, represents total debt at quarter end divided by annualized Adjusted OIBDA for the quarter.
(i) For Mediacom Combined and Mediacom Broadband LLC, represents OIBDA divided by cash interest expense for the quarter. For Mediacom LLC, represents Adjusted OIBDA divided by cash interest expense for the quarter.

Contacts

Mediacom Communications Corporation
Investor Relations
Jack P. Griffin
Vice President, Corporate Finance
(845) 443-2654
or
Media Relations
Thomas J. Larsen
Senior Vice President, Government and Public Relations
(845) 443-2754