Investor News Release
Mediacom Reports Financial Results for 1999 Third Quarter
These increases in revenues and EBITDA resulted in part from the Company's acquisition activities during 1998. On a pro forma basis, assuming all 1998 acquisitions had been consummated on January 1, 1998, for the three months ended September 30, 1999, revenues increased by 12.6% and EBITDA rose by 19.0% over the comparable period in 1998. On the same pro forma basis, for the nine months ended September 30, 1999, revenues increased by 11.8% and EBITDA rose by 21.6% over the comparable period in 1998. These pro forma results are intended to normalize the effects of all acquisitions and other adjustments to reflect comparability between periods.
In commenting on the third quarter results, Rocco B. Commisso, Mediacom's Chairman and CEO, stated "We are pleased with our performance to date in 1999. Our financial results reaffirm our strategy of rapidly upgrading the Company's broadband distribution network and introducing to our customers an array of new products and services."
As previously announced, subsequent to September 30, 1999, the Company completed the acquisitions of the cable television systems owned by Triax Midwest Associates, L.P. and Zylstra Communications Corporation for an aggregate purchase price of approximately $760 million. The Triax and Zylstra transactions doubled the size of the Company's customer base and provide strong regional clusters in the Midwest. The Triax and Zylstra systems serve approximately 358,000 basic subscribers, principally in Illinois, Indiana and Minnesota.
Also, on November 4, 1999, the Company finalized the agreement with SoftNet Systems, Inc. (Nasdaq: SOFN), a leading broadband services provider, under which Mediacom has committed approximately one million cable homes passed for SoftNet's ISP Channel high-speed Internet access. As part of this agreement, SoftNet will issue to the Company 3.5 million shares of its common stock, and Mr. Commisso will be appointed to SoftNet's Board of Directors.
During the first nine months of 1999, the Company continued to invest heavily in upgrading its technical infrastructure, as total capital expenditures were approximately $60 million. For all of 1999, the Company expects that total capital expenditures will be approximately $80 million, inclusive of expenditures related to the acquired Triax and Zylstra systems. As a result of these acquisitions, the Company has updated its capital improvement program and now expects to spend approximately $400 million over the three-year period ending December 2002, of which approximately $240 million will be invested to upgrade the cable network and approximately $160 million will be used for plant expansion, digital headends and set-top boxes, cable modems and maintenance.
Mediacom is the 8th largest cable television operator in the United States, based on customers served by wholly-owned systems after giving effect to its pending acquisitions and recently announced industry transactions. Mediacom's systems pass approximately 1.1 million homes and serve approximately 740,000 basic subscribers, including its pending acquisitions. Mediacom was founded in July 1995 by Rocco B. Commisso to acquire and develop cable television systems serving principally non-metropolitan markets of the United States.
This press release may contain forward-looking statements. Readers are advised that such forward-looking statements involve risks and uncertainties that could significantly affect expected results from those expressed in any such statements. Readers are directed to Mediacom's 1998 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, for a discussion of such risks and uncertainties.