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Mediacom Communications Reports Combined Results for Second Quarter 2017

MEDIACOM PARK, N.Y.--(BUSINESS WIRE)--MEDIACOM COMMUNICATIONS CORPORATION today released combined unaudited financial and operating highlights for the three months ended June 30, 2017.

Mediacom Combined Results for Second Quarter 2017*

  • Revenues were $471.5 million, reflecting a 4.6% increase from the prior year period
  • OIBDA was $179.6 million, reflecting a 4.0% increase from the prior year period
  • Capital expenditures were $89.1 million, compared to $86.4 million in the prior year period
  • Free cash flow was $64.1 million, compared to $55.6 million in the prior year period
  • Ending primary service units ("PSUs") of 2,534,000, a 4.5% increase from June 30, 2016
    • Includes 14,000 PSUs acquired by Mediacom LLC in January 2017
  • Ending customer relationships of 1,364,000, a 2.1% increase from June 30, 2016
    • Includes 9,000 customer relationships acquired by Mediacom LLC in January 2017
  • Total leverage ratio of 3.78x, compared to 4.19x at June 30, 2016
  • Interest coverage ratio of 6.82x, compared to 5.61x at June 30, 2016
  • Ending total debt of $2,715.0 million, a reduction of $180.0 million from June 30, 2016

Reference to "Mediacom Combined" reflects the combined results of Mediacom Broadband LLC and Mediacom LLC, eliminating intercompany amounts. Mediacom LLC information is being voluntarily provided, as Mediacom LLC's contractual obligation to file reports with the Securities and Exchange Commission ("SEC") terminated in February 2017. Mediacom Combined information is being provided for convenience and informational purposes, and does not modify or supplement the previously released separate financial results of Mediacom Broadband LLC. Holders of Mediacom Broadband LLC debt should refer to its separate financial and operating results, which were previously released and furnished with the SEC on Form 8-K on August 3, 2017.

About Mediacom

Mediacom Communications Corporation is the 5th largest cable operator in the U.S. serving almost 1.4 million customers in smaller markets primarily in the Midwest and Southeast. 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.mediacomcable.com.

             

TABLE 1*

Mediacom Communications Corporation

Selected Combined Financial and Operating Data

(Dollars in thousands, except per unit data)

(Unaudited)

             
      Three Months Ended
June 30,
     
        2017         2016       YoY% Change

Video

    $

201,311

     

$

203,257

      (1.0 %)
High-speed data       167,040         149,357       11.8 %
Phone       28,230         27,581       2.4 %
Business services       62,210         57,367       8.4 %
Advertising       12,671         13,259       (4.4 %)
Total revenues     $ 471,462       $ 450,821       4.6 %
Service costs       (202,765 )       (190,606 )     6.4 %
SG&A expenses       (80,614 )       (79,540 )     1.4 %
Management fees       (8,500 )       (8,000 )     6.3 %
OIBDA (a)     $ 179,583       $ 172,675       4.0 %
Cash interest expense (a)       (26,335 )       (30,760 )     (14.4 %)
Capital expenditures       (89,125 )       (86,353 )     3.2 %
Free cash flow (a)     $ 64,123       $ 55,562       15.4 %
                   
OIBDA margin (b)       38.1 %       38.3 %      
                   
                   
      June 30, 2017     June 30, 2016     YoY% Change
Video customers       829,000         842,000       (1.5 %)
High-speed data ("HSD") customers       1,185,000         1,128,000       5.1 %
Phone customers       520,000         454,000       14.5 %
Primary service units ("PSUs")       2,534,000         2,424,000       4.5 %
                   
Video customer declines       (3,000 )       (11,000 )      
HSD customer increases       6,000         14,000        
Phone customer increases       25,000         10,000        
Quarterly PSU increases       28,000         13,000        
                   
Customer relationships (c)       1,364,000         1,336,000       2.1 %
                   
Average total monthly revenue per:                  
PSU (d)     $ 62.36       $ 62.16       0.3 %
Customer relationship (e)     $ 115.05       $ 112.61       2.2 %
                   
                   
      June 30, 2017     June 30, 2016      
Bank credit facility     $ 2,215,000       $ 2,145,000        
5½% senior notes due 2021       200,000         200,000        
7¼% senior notes due 2022    

      250,000        
6⅜% senior notes due 2023       300,000         300,000        
Total debt (f)     $ 2,715,000       $ 2,895,000        
                   
Total leverage ratio (g)     3.78x     4.19x      
Interest coverage ratio (h)     6.82x     5.61x      
                   
* 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
June 30, 2017
     

Mediacom
Broadband

   

Mediacom
LLC

    Eliminations    

Mediacom
Combined

Video     $

111,522

      $ 89,789      

    $ 201,311  
High-speed data       91,246         75,794      

      167,040  
Phone       15,049         13,181      

      28,230  
Business services       37,978         24,232      

      62,210  
Advertising       10,110         2,561      

      12,671  
Total revenues     $ 265,905       $ 205,557      

    $ 471,462  
Service costs       (110,930 )       (91,835 )    

      (202,765 )
SG&A expenses       (48,621 )       (31,993 )    

      (80,614 )
Management fees       (5,015 )       (3,485 )    

      (8,500 )
OIBDA (a)     $ 101,339       $ 78,244      

    $ 179,583  
Investment income from affiliate    

      4,500       (4,500 )    

Adjusted OIBDA (a)     $ 101,339       $ 82,744       (4,500 )     $ 179,583  
Cash interest expense (a)       (17,074 )       (9,261 )    

      (26,335 )
Capital expenditures       (48,726 )       (40,399 )    

      (89,125 )
Dividend to preferred members       (4,500 )    

    4,500      

Free cash flow (a)     $ 31,039       $ 33,084      

    $ 64,123  
                         
                         
     

Mediacom
Broadband

   

Mediacom
LLC

         

Mediacom
Combined

Video customers       459,000         370,000               829,000  
HSD customers       655,000         530,000               1,185,000  
Phone customers       288,000         232,000               520,000  
Primary service units ("PSUs")       1,402,000         1,132,000               2,534,000  
                         
Video customer declines       (2,000 )       (1,000 )             (3,000 )
HSD customer increases       3,000         3,000               6,000  
Phone customer increases       15,000         10,000               25,000  
Quarterly PSU increases       16,000         12,000               28,000  
                         
Customer relationships (c)       754,000         610,000               1,364,000  
                         
Average total monthly revenue per:                        
PSU (d)     $ 63.58       $ 60.85             $ 62.36  
Customer relationship (e)     $ 117.32       $ 112.23             $ 115.05  
                         
                         
     

Mediacom
Broadband

   

Mediacom
LLC

         

Mediacom
Combined

Bank credit facility     $ 1,014,000       $ 1,201,000             $ 2,215,000  
5½% senior notes due 2021       200,000      

            200,000  
6⅜% senior notes due 2023       300,000      

            300,000  
Total debt (f)     $ 1,514,000       $ 1,201,000             $ 2,715,000  
                         
Total leverage ratio (g)     3.73x     3.63x           3.78x
Interest coverage ratio (h)     5.93x     8.93x           6.82x
                         
* 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
June 30, 2016
     

Mediacom
Broadband

   

Mediacom
LLC

    Eliminations    

Mediacom
Combined

Video    

$

114,148

      $ 89,109      

    $ 203,257  
High-speed data       82,307         67,050      

      149,357  
Phone       14,655         12,926      

      27,581  
Business services       34,950         22,417      

      57,367  
Advertising       10,308         2,951      

      13,259  
Total revenues     $ 256,368       $ 194,453      

    $ 450,821  
Service costs       (105,413 )       (85,193 )    

      (190,606 )
SG&A expenses       (48,133 )       (31,407 )    

      (79,540 )
Management fees       (4,750 )       (3,250 )    

      (8,000 )
OIBDA (a)     $ 98,072       $ 74,603      

    $ 172,675  
Investment income from affiliate    

      4,500       (4,500 )    

Adjusted OIBDA (a)     $ 98,072       $ 79,103       (4,500 )     $ 172,675  
Cash interest expense (a)       (18,461 )       (12,299 )    

      (30,760 )
Capital expenditures       (45,013 )       (41,340 )    

      (86,353 )
Dividend to preferred members       (4,500 )    

    4,500      

Free cash flow (a)     $ 30,098       $ 25,464      

    $ 55,562  
                         
                         
     

Mediacom
Broadband

   

Mediacom
LLC

         

Mediacom
Combined

Video customers       472,000         370,000               842,000  
HSD customers       628,000         500,000               1,128,000  
Phone customers       250,000         204,000               454,000  
Primary service units ("PSUs")       1,350,000         1,074,000               2,424,000  
                         
Video customer declines       (7,000 )       (4,000 )             (11,000 )
HSD customer increases       7,000         7,000               14,000  
Phone customer increases       5,000         5,000               10,000  
Quarterly PSU increases       5,000         8,000               13,000  
                         
Customer relationships (c)       741,000         595,000               1,336,000  
                         
Average total monthly revenue per:                        
PSU (d)     $ 63.42       $ 60.58             $ 62.16  
Customer relationship (e)     $ 115.40       $ 109.12             $ 112.61  
                         
                         
     

Mediacom
Broadband

   

Mediacom
LLC

         

Mediacom
Combined

Bank credit facility     $ 1,188,000       $ 957,000             $ 2,145,000  
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 (f)     $ 1,688,000       $ 1,207,000             $ 2,895,000  
                         
Total leverage ratio (g)     4.30x     3.81x           4.19x
Interest coverage ratio (h)     5.31x     6.43x           5.61x
                         
* 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)

  Represents OIBDA as a percentage of total revenues.

(c)

  Represents the total number of customers that take at least one service, without regard to which service(s) customers purchase.

(d)

  Represents average total monthly revenues for the period divided by average PSUs for such period.

(e)

  Represents average total monthly revenues for the period divided by average customer relationships for such period.

(f)

  Total debt excludes the effect of deferred financing costs, net.

(g)

  For Mediacom Combined and Mediacom Broadband LLC, represents total debt at period end divided by annualized OIBDA for the period. For Mediacom LLC, represents total debt at period end divided by annualized Adjusted OIBDA for the period.

(h)

  For Mediacom Combined and Mediacom Broadband LLC, represents OIBDA divided by cash interest expense for the period. For Mediacom LLC, represents Adjusted OIBDA divided by cash interest expense for the period.

 

 

Contacts

 

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