MEDIACOM BROADBAND LLC/MEDIACOM BROADBAND CORP
Table of Contents



SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q


Quarterly Report Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934

For the quarterly period ended September 30, 2004

     
Commission File Numbers:
  333-72440
333-72440-01

Mediacom Broadband LLC
Mediacom Broadband Corporation*

(Exact names of Registrants as specified in their charters)
     
Delaware   06-1615412
Delaware   06-1630167
(State or other jurisdiction of
incorporation or organization)
  (I.R.S. Employer
Identification Numbers)

100 Crystal Run Road
Middletown, New York 10941

(Address of principal executive offices)

(845) 695-2600
(Registrants’ telephone number)

     Indicate by check mark whether the Registrants (1) have filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. Yes þ No o

     Indicate by checkmark whether the registrants are accelerated filers (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

     Indicate the number of shares outstanding of the Registrants’ common stock: Not Applicable

     *Mediacom Broadband Corporation meets the conditions set forth in General Instruction H (1) (a) and (b) of Form 10-Q and is therefore filing this form with the reduced disclosure format.



 


MEDIACOM BROADBAND LLC AND SUBSIDIARIES

FORM 10-Q
FOR THE PERIOD ENDED SEPTEMBER 30, 2004

TABLE OF CONTENTS

                 
            Page
PART I
                 
Item 1.          
                 
            1  
                 
            2  
                 
            3  
                 
            4  
                 
            5  
                 
Item 2.       10  
                 
Item 3.       19  
                 
Item 4.       20  
                 
PART II
                 
Item 1.       21  
                 
Item 6.       21  
 EX-31.1: CERTIFICATIONS
 EX-31.2: CERTIFICATIONS
 EX-32.1: CERTIFICATIONS
 EX-32.2: CERTIFICATIONS


     You should carefully review the information contained in this Quarterly Report and in other reports or documents that we file from time to time with the Securities and Exchange Commission (the “SEC”). In this Quarterly Report, we state our beliefs of future events and of our future financial performance. In some cases, you can identify those so-called “forward-looking statements” by words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of those words and other comparable words. You should be aware that those statements are only our predictions. Actual events or results may differ materially. In evaluating those statements, you should specifically consider various factors, including the risks discussed in our Annual Report on Form 10-K for the year ended December 31, 2003 and other reports or documents that we file from time to time with the SEC. Those factors may cause our actual results to differ materially from any of our forward-looking statements. All forward-looking statements attributable to us, or a person acting on our behalf, are expressly qualified in their entirety by this cautionary statement.

 


Table of Contents

PART I

ITEM 1.  FINANCIAL STATEMENTS

MEDIACOM BROADBAND LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollar amounts in 000’s)
(Unaudited)
                 
    September 30,   December 31,
    2004
  2003
ASSETS                
CURRENT ASSETS
               
Cash and cash equivalents
  $ 3,498     $ 9,379  
Investment
          644  
Subscriber accounts receivable, net of allowance for doubtful accounts of $2,700 and $2,455, respectively
    32,616       34,522  
Prepaid expenses and other assets
    2,727       9,853  
 
   
 
     
 
 
Total current assets
    38,841       54,398  
Investment in cable television systems:
               
Property, plant and equipment, net of accumulated depreciation of $280,118 and $204,305, respectively
    727,927       743,120  
Intangible assets, net of accumulated amortization of $55,417 and $53,377, respectively
    1,472,211       1,473,854  
 
   
 
     
 
 
Total investment in cable television systems
    2,200,138       2,216,974  
Other assets, net of accumulated amortization of $6,535 and $5,176, respectively
    14,802       16,412  
 
   
 
     
 
 
Total assets
  $ 2,253,781     $ 2,287,784  
 
   
 
     
 
 
LIABILITIES AND MEMBER’S DEFICIT                
CURRENT LIABILITIES
               
Accrued liabilities
  $ 105,779     $ 148,969  
Deferred revenue
    20,448       20,202  
Current portion of long-term debt
    31,805       9,771  
 
   
 
     
 
 
Total current liabilities
    158,032       178,942  
Long-term debt, less current portion
    1,328,729       1,344,897  
Other non-current liabilities
    16,939       24,929  
 
   
 
     
 
 
Total liabilities
    1,503,700       1,548,768  
PREFERRED MEMBER’S INTEREST
    150,000       150,000  
MEMBER’S EQUITY
               
Capital contributions
    725,000       725,000  
Accumulated deficit
    (124,919 )     (135,984 )
 
   
 
     
 
 
Total member’s deficit
    600,081       589,016  
 
   
 
     
 
 
Total liabilities and member’s deficit
  $ 2,253,781     $ 2,287,784  
 
   
 
     
 
 

The accompanying notes to unaudited consolidated financial
statements are an integral part of these statements.

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in 000’s, except per share data)
(Unaudited)
                 
    Three Months Ended
    September 30,
    2004
  2003
Revenues
  $ 144,977     $ 137,207  
Costs and expenses:
               
Service costs (exclusive of depreciation and amortization of $26,957 and $24,974, respectively, shown separately below)
    56,186       52,612  
Selling, general and administrative expenses
    32,075       30,259  
Management fee expense
    2,798       2,408  
Depreciation and amortization
    26,957       24,974  
 
   
 
     
 
 
Operating income
    26,961       26,954  
Interest expense, net
    (21,875 )     (20,502 )
(Loss) gain on derivatives, net
    (2,146 )     5,433  
Other expense
    (1,319 )     (1,908 )
 
   
 
     
 
 
Net income
  $ 1,621     $ 9,977  
 
   
 
     
 
 

The accompanying notes to unaudited consolidated financial
statements are an integral part of these statements.

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Table of Contents

MEDIACOM BROADBAND LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in 000’s, except per share data)
(Unaudited)
                 
    Nine Months Ended
    September 30,
    2004
  2003
Revenues
  $ 436,101     $ 409,474  
Costs and expenses:
               
Service costs (exclusive of depreciation and amortization of $80,300 and $88,010, respectively, shown separately below)
    167,680       160,208  
Selling, general and administrative expenses
    94,267       86,936  
Management fee expense
    8,206       6,593  
Depreciation and amortization
    80,300       88,010  
 
   
 
     
 
 
Operating income
    85,648       67,727  
Interest expense, net
    (64,223 )     (61,951 )
Gain (loss) on derivatives, net
    6,700       (1,970 )
Other expense
    (3,560 )     (4,232 )
 
   
 
     
 
 
Net income (loss)
  $ 24,565     $ (426 )
 
   
 
     
 
 

The accompanying notes to unaudited consolidated financial
statements are an integral part of these statements.

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollar amounts in 000’s)
(Unaudited)
                 
    Nine Months Ended
    September 30,
    2004
  2003
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
               
Net income (loss)
  $ 24,565     $ (426 )
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
               
Depreciation and amortization
    80,300       88,010  
(Gain) loss on derivatives, net
    (6,700 )     1,970  
Amortization of deferred financing costs
    1,610       1,756  
Changes in assets and liabilities, net of effects from acquisitions:
               
Subscriber accounts receivable, net
    1,906       448  
Prepaid expenses and other assets
    7,126       4,626  
Accrued liabilities
    (43,189 )     (34,387 )
Deferred revenue
    246       1,539  
Other non-current liabilities
    (1,925 )     (1,393 )
 
   
 
     
 
 
Net cash flows provided by operating activities
    63,939       62,143  
 
   
 
     
 
 
CASH FLOWS USED IN INVESTING ACTIVITIES:
               
Capital expenditures
    (61,558 )     (97,067 )
Proceeds from sales of investments
          9,671  
Other investing activities
    (628 )     1,409  
 
   
 
     
 
 
Net cash flows used in investing activities
    (62,186 )     (85,987 )
 
   
 
     
 
 
CASH FLOWS (USED IN) PROVIDED BY FINANCING ACTIVITIES:
               
New borrowings
    116,000       106,554  
Repayment of debt
    (110,134 )     (59,385 )
Dividend payments on preferred members’ interests
    (13,500 )     (13,500 )
Dividend payment to parent
          (9,060 )
 
   
 
     
 
 
Net cash flows (used in) provided by financing activities
    (7,634 )     24,609  
 
   
 
     
 
 
Net (decrease) increase in cash and cash equivalents
    (5,881 )     765  
CASH AND CASH EQUIVALENTS, beginning of period
    9,379       10,307  
 
   
 
     
 
 
CASH AND CASH EQUIVALENTS, end of period
  $ 3,498     $ 11,072  
 
   
 
     
 
 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
               
Cash paid during the period for interest, net of amounts capitalized
  $ 75,794     $ 74,386  
 
   
 
     
 
 
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING ACTIVITIES:
               
Capital expenditures financed through capital leases
  $     $ 5,023  
 
   
 
     
 
 

The accompanying notes to unaudited consolidated financial
statements are an integral part of these statements.

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(1) Organization

     Mediacom Broadband LLC (“Mediacom Broadband,” and collectively with its subsidiaries, the “Company”), a Delaware limited liability company wholly-owned by Mediacom Communications Corporation (“MCC”), was organized for the purpose of acquiring cable systems from AT&T Broadband, LLC in 2001.

     Mediacom Broadband relies on its parent, MCC, for various services such as corporate and administrative support. The financial position, results of operations and cash flows of Mediacom Broadband could differ from those that would have resulted had Mediacom Broadband operated autonomously or as an entity independent of MCC.

     Mediacom Broadband Corporation, a Delaware corporation wholly-owned by Mediacom Broadband, co-issued, jointly and severally with Mediacom Broadband, $400.0 million aggregate principal amount of the 11% senior notes due July 15, 2013. Mediacom Broadband Corporation has no operations, revenues or cash flows. Mediacom Broadband Corporation maintains a one-hundred dollar receivable from an affiliate and common stock on its balance sheet. Therefore, separate financial statements have not been presented for this entity.

(2) Statement of Accounting Presentation and Other Information

  Basis of Preparation of Unaudited Consolidated Financial Statements

     Mediacom Broadband has prepared these unaudited consolidated financial statements as of September 30, 2004 and 2003. In the opinion of management, such statements include all adjustments, consisting of normal recurring accruals and adjustments, necessary for a fair presentation of the Company’s consolidated results of operations and financial position for the interim periods presented. The accounting policies followed during such interim periods reported are in conformity with generally accepted accounting principles in the United States of America and are consistent with those applied during annual periods. For additional disclosures, including a summary of the Company’s accounting policies, the interim unaudited consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2003 (File Nos. 333-72440 and 333-72440-01). The results of operations for the interim periods are not necessarily indicative of the results that might be expected for future interim periods or for the full year ending December 31, 2004.

  Change in Estimate

     Effective July 1, 2003, the Company changed the estimated useful lives of certain plant and equipment of its cable systems in conjunction with the Company’s completed network upgrade and rebuild program. The changes in estimated useful lives were made to reflect management’s evaluation of the longer economic lives of the Company’s upgraded and rebuilt network. The weighted average useful lives of such plant and equipment changed from approximately 7 years to approximately 12 years. These changes were made on a prospective basis effective July 1, 2003 and resulted in a reduction of depreciation expense and a corresponding increase in net income of approximately $22.7 million and $11.1 million for the nine months ended September 30, 2004 and 2003, respectively.

  Property, Plant and Equipment

     Property, plant and equipment are recorded at cost. Additions to property, plant and equipment generally include material, labor and indirect costs. Depreciation is calculated on a straight-line basis over the following useful lives:

     
Buildings
  40 years
Leasehold improvements
  Life of respective lease
Cable systems and equipments and subscriber devices
  4 to 20 years
Vehicles
  5 years
Furniture, fixtures and office equipment
  5 years

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

     The Company capitalizes improvements that extend asset lives and expenses repairs and maintenance as incurred. At the time of retirements, or other dispositions of property, the original cost and related accumulated depreciation are removed from the respective accounts and the losses are presented as a component of depreciation expense.

     The Company capitalizes the costs associated with the construction of cable transmission and distribution facilities, and new cable installations. Costs include direct labor and material, as well as certain indirect costs. The Company performs periodic evaluations of certain estimates used to determine such costs that are capitalized. Any changes to these estimates, which may be significant, are applied in the period in which the evaluations were completed. The costs of disconnecting service at a customer’s dwelling or reconnecting to a previously installed dwelling are charged as expense in the period incurred. Costs associated with subsequent installations of additional services not previously installed at a customer’s dwelling are capitalized to the extent such costs are incremental and directly attributable to the installation of such additional services.

  Comprehensive Income

     SFAS No. 130, “Reporting Comprehensive Income” (“SFAS 130”) requires companies to classify items of other comprehensive income by their nature in the financial statements and display the accumulated balance of other comprehensive income separately from retained earnings and additional paid-in capital in the equity section of a statement of financial position. The Company has had no other comprehensive income items to report.

  Reclassifications

     Certain reclassifications have been made to the prior year’s amounts to conform to the current year’s presentation.

(3) Property, Plant and Equipment

     As of September 30, 2004 and December 31, 2003, property, plant and equipment consisted of (dollars in thousands):

                 
    September 30,   December 31,
    2004
  2003
Land and land improvements
  $ 4,571     $ 4,518  
Buildings and leasehold improvements
    23,769       22,941  
Cable systems, equipment and subscriber devices
    937,530       878,600  
Vehicles
    32,140       33,491  
Furniture, fixtures and office equipment
    10,035       7,875  
 
   
 
     
 
 
 
    1,008,045       947,425  
Accumulated depreciation
    (280,118 )     (204,305 )
 
   
 
     
 
 
Property, plant and equipment, net
  $ 727,927     $ 743,120  
 
   
 
     
 
 

     Depreciation expense for the three and nine months ended September 30, 2004 was approximately $26.5 million and $78.4 million, respectively and $23.9 million and $85.9 million for the respective periods in 2003.

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

(4) Intangible Assets

     The Company operates its cable systems under non-exclusive cable franchises that are granted by state or local government authorities for varying lengths of time. The Company acquired these cable franchises through acquisitions of cable systems and accounted for them using the purchase method of accounting.

     In accordance with FASB No. 142 “Goodwill and Other Intangible Assets”, indefinite-lived intangible assets include goodwill and cable franchise costs. The provisions of SFAS No. 142 prohibits the amortization of indefinite-lived intangible assets and goodwill, but require such assets to be tested annually for impairment, or more frequently if impairment indicators arise. The Company has determined that its cable franchise costs and goodwill are indefinite-lived assets. Accordingly, on January 1, 2002, the Company ceased the amortization of its indefinite-lived intangible assets. Other finite-lived intangible assets, which consist primarily of subscriber lists and covenants not to compete, continue to be amortized over their useful lives of 5 to 10 years and 5 years, respectively. The following table summarizes the net asset value for each intangible asset category as of September 30, 2004 and December 31, 2003 (dollars in thousands):

                         
    Gross Asset   Accumulated   Net Asset
September 30, 2004
  Value
  Amortization
  Value
Franchise costs
  $ 1,289,923     $ 38,752     $ 1,251,171  
Goodwill
    204,582             204,582  
Subscriber Lists
    33,123            16,665       16,458  
 
   
 
     
 
     
 
 
 
  $ 1,527,628     $     55,417     $ 1,472,211  
 
   
 
     
 
     
 
 
                         
    Gross Asset   Accumulated   Net Asset
December 31, 2003
  Value
  Amortization
  Value
Franchise costs
  $ 1,289,526     $ 38,752     $ 1,250,774  
Goodwill
    204,582             204,582  
Subscriber Lists
    33,123            14,625       18,498  
 
   
 
     
 
     
 
 
 
  $ 1,527,231     $ 53,377     $ 1,473,854  
 
   
 
     
 
     
 
 

     Amortization expense for the three and nine months ended September 30, 2004 was approximately $0.5 million and $2.0 million, respectively and $1.1 million and $2.1 million for the respective periods in 2003. The Company’s estimated future aggregate amortization expense for 2004 through 2008 and beyond are $0.5 million, $2.1 million, $2.1 million, $2.1 million, $2.1 million and $7.6 million, respectively.

(5) Accrued Liabilities

     Accrued liabilities consist of the following as of September 30, 2004 and December 31, 2003 (dollars in thousands):

                 
    September 30,   December 31,
    2004
  2003
Accrued interest
  $ 13,039     $ 24,012  
Accrued payroll and benefits
    10,454       10,588  
Accrued programming costs
    41,278       63,152  
Accrued property, plant and equipment
    5,799       12,899  
Accrued taxes and fees
    10,523       16,303  
Accrued telecommunications
    8,893       8,214  
Other accrued expenses
    15,793       13,801  
 
   
 
     
 
 
 
  $ 105,779     $ 148,969  
 
   
 
     
 
 

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

(6) Debt

     As of September 30, 2004 and December 31, 2003, debt consisted of (dollars in thousands):

                 
      September 30,       December 31,
    2004
  2003
Bank credit facilities
  $ 956,750     $ 950,000  
11% senior notes
    400,000       400,000  
Capital lease obligations
    3,784       4,668  
 
   
 
     
 
 
 
  $ 1,360,534     $ 1,354,668  
Less: Current portion
    31,805       9,771  
 
   
 
     
 
 
Total long-term debt
  $ 1,328,729     $ 1,344,897  
 
   
 
     
 
 

     The average interest rates on outstanding debt under the bank credit facility were 3.7% and 3.4% for the three and nine months ended September 30, 2004, before giving effect to the interest rate exchange agreements discussed below. As of September 30, 2004, the Company had unused credit commitments of approximately $430.9 million under its bank credit facility, of which about $283.1 million could be borrowed and used for general corporate purposes based on the terms and conditions of the Company’s debt arrangements. The Company was in compliance with all covenants under its debt arrangements for all periods through September 30, 2004.

     The Company uses interest rate exchange agreements, or “swaps”, with counterparties to fix the interest rate on a portion of its floating rate debt. As of September 30, 2004, the Company had interest rate exchange agreements with various banks pursuant to which the interest rate on $500.0 million is fixed at a weighted average rate of approximately 3.4%. The fixed rates of the swap agreements are offset against the applicable three-month London Interbank Offering Rate, or LIBOR, to determine the interest expense related to these agreements. At the end of each quarterly reporting period the carrying values of these swap agreements are marked-to-market. The fair values of these agreements are driven by market interest rates, their remaining time to maturity and the creditworthiness of the counterparties. The aggregate fair value of the agreements is the estimated amount that the Company would receive or pay to terminate them. At September 30, 2004, based on the mark-to-market valuation, the Company would have paid approximately $5.5 million, including accrued interest, if these agreements were terminated.

     Changes in the aggregate mark-to-market values of these swap agreements result in short-term gains or losses and may increase the volatility of the Company’s earnings. The Company had a net loss of $2.1 million and a net gain of $6.7 million for the three and nine months, respectively, ended September 30, 2004, as compared to a net gain of $5.4 million and a net loss of $2.0 million for the three and nine months, respectively, ended September 30, 2003.

     Under the terms of the interest rate exchange agreements, which expire from 2005 through 2007, the Company is exposed to credit loss in the event of nonperformance by the other parties. However, due to the creditworthiness of the Company’s counterparties, which are major banking firms rated investment grade, the Company does not anticipate their nonperformance.

(7) Preferred Members’ Interests

     Mediacom LLC, a wholly-owned subsidiary of MCC, has a $150.0 million preferred equity investment in the Company. The preferred equity investment has a 12% annual dividend, payable quarterly in cash. During the nine months ended September 30, 2004 and 2003, the Company paid $13.5 million in cash dividends on the preferred equity.

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MEDIACOM BROADBAND LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

(8) Contingency

     On April 5, 2004, a lawsuit was filed against MCC Georgia LLC, one of the Company’s subsidiaries, its parent, MCC, and other, currently unnamed potential defendants in the United States District Court for the District of Colorado by Echostar Satellite LLC, which operates a direct broadcast satellite business under the name “Dish Network”. Echostar alleges that systems operated by MCC Georgia LLC have used, without authorization, Dish Network satellite dishes activated under residential accounts to receive the signals of certain broadcast television stations in one or more locations in Georgia and that it has then been redistributing those signals, through its cable systems, to its subscribers. Among other claims, the complaint filed by Echostar alleges that these actions violate a provision of the Communications Act of 1934 (47 U.S.C. Sec. 605) that prohibits unauthorized interception of radio communications. The plaintiff seeks injunctive relief, actual and statutory damages, disgorgement of profits, punitive damages and litigation costs, including attorneys’ fees.

     On June 29, 2004, Echostar amended its complaint to also allege that this conduct amounted to a breach of the contract between Echostar and one of MCC’s employees, who allegedly acted as an agent for MCC, by which MCC received the Echostar satellite signal. On September 7, 2004, the U.S. District Court granted MCC’s motion to transfer the case to the Middle District of Georgia, where venue is proper and where personal jurisdiction over MCC exists. There have been no further proceedings since that date. MCC Georgia LLC and the Company’s parent company have advised the Company that they intend to vigorously defend against these claims. At the present time, the Company is unable to reasonably evaluate the likelihood of an unfavorable outcome or quantify the possible damages, if any, associated with these matters, or whether or not the those damages would be material to its consolidated financial position, results of operations, cash flows or business.

     The Company also is involved in various other legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations, cash flows or business.

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ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     The following discussion should be read in conjunction with the Company’s unaudited consolidated financial statements as of and for the three and nine months ended September 30, 2004 and 2003 and with the Company’s annual report on Form 10-K for the year ended December 31, 2003.

Overview

     We are a wholly-owned subsidiary of Mediacom Communications Corporation. As of September 30, 2004, our cable systems passed approximately 1.45 million homes and served approximately 780,000 basic subscribers in four states. Many of our cable systems are located in markets that are contiguous with, or in close proximity to, cable systems owned and operated by Mediacom LLC, a wholly-owned subsidiary of our manager.

     In mid-2003, we completed our network upgrade program that significantly increased bandwidth and enabled interactivity. Our upgraded network allows us to introduce additional programming and other products and services such as digital video, video-on-demand, high-definition television, digital video recorders and broadband data access. We currently provide digital video services to approximately 228,000 subscribers, representing a penetration of approximately 29.2% of our basic subscribers. We also currently provide broadband data services to approximately 197,000 subscribers, representing a penetration of approximately 13.6% of our homes passed. Beginning in the first half of 2005, we plan to launch in certain of our markets Internet protocol telephony service, which is sometimes referred to as Voice-over-Internet-Protocol, or VoIP telephony. VoIP telephony will allow us to offer an attractive triple-play bundle of video, data and voice products and services. Bundled products and services offer our subscribers key benefits such as a single provider contact for provisioning, billing and customer care.

     We face increasing competition for our video programming services, most notably from direct broadcast satellite service, or DBS service providers. During the first nine months of 2004, competitive pressure from DBS service providers intensified when they launched local television channels in additional markets representing an estimated 17% of our basic subscriber base. Since they have been permitted to deliver local television broadcast signals beginning in 1999, DIRECTV, Inc. and Echostar Communications Corporation, the two largest DBS service providers, have been gradually increasing the number of markets in which they deliver these local television signals. These “local-into-local” launches were usually accompanied by heavy marketing and advertising and were the primary cause of our loss of basic subscribers in recent periods. As of September 30, 2004, competitive local-into-local services in our markets covered an estimated 92% of our basic subscribers.

  Use of Operating Income Before Depreciation and Amortization

     Operating income before depreciation and amortization, or OIBDA, is not a financial measure calculated in accordance with generally accepted accounting principles (GAAP) in the United States. However, OIBDA is one of the primary measures used by management to evaluate our performance and to forecast future results. We believe OIBDA is useful for investors because it enables them to assess our performance in a manner similar to the method used by management, and provides a measure that can be used to analyze, value and compare the companies in the cable television industry, which may have different depreciation and amortization policies. A limitation of this measure, however, is that it excludes depreciation and amortization, which represents the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in our business. Management utilizes a separate process to budget, measure and evaluate capital expenditures.

     OIBDA should not be regarded as an alternative to either operating income or net income (loss) as an indicator of operating performance nor should it be considered in isolation or as a substitute for financial measures prepared in accordance with GAAP. We believe that operating income is the most directly comparable GAAP financial measure to OIBDA.

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     The following table sets forth the reconciliation of OIBDA to operating income for the three and nine months ended September 30, 2004 and 2003 (dollars in thousands and unaudited):

                                 
    Three Months Ended   Nine Months Ended
    September 30,
  September 30,
    2004
  2003
  2004
  2003
OIBDA
  $ 53,918     $ 51,928     $ 165,948     $ 155,737  
Depreciation and amortization
    (26,957 )     (24,974 )     (80,300 )     (88,010 )
 
   
 
     
 
     
 
     
 
 
Operating income
  $ 26,961     $ 26,954     $ 85,648     $ 67,727  
 
   
 
     
 
     
 
     
 
 

Actual Results of Operations

  Three Months Ended September 30, 2004 Compared to Three Months Ended September 30, 2003

     The following table sets forth the unaudited consolidated statement of operations for the three months ended September 30, 2004 and 2003 (dollars in thousands and percentage changes that are not meaningful are marked NM):

                                 
    Three Months Ended        
    September 30,
       
    2004
  2003
  $ Change
  % Change
Revenues
  $ 144,977     $ 137,207     $ 7,770       5.7 %
Costs and expenses:
                               
Service costs
    56,186       52,612       3,574       6.8 %
Selling, general and administrative expenses
    32,075       30,259       1,816       6.0 %
Management fee expense
    2,798       2,408       390       16.2 %
Depreciation and amortization
    26,957       24,974       1,983       7.9 %
 
   
 
     
 
     
 
     
 
 
Operating income
    26,961       26,954       7        
Interest expense, net
    (21,875 )     (20,502 )     (1,373 )     6.7 %
(Loss) gain on derivatives, net
    (2,146 )     5,433       (7,579 )   NM
Other expense
    (1,319 )     (1,908 )     589       (30.9 %)
 
   
 
     
 
     
 
     
 
 
Net income
  $ 1,621     $ 9,977     $ (8,356 )   NM
 
   
 
     
 
     
 
     
 
 
OIBDA
  $ 53,918     $ 51,928     $ 1,990       3.8 %

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  Revenues

     The following table sets forth revenue information for the three months ended September 30, 2004 and 2003 (dollars in millions):

                                                        
    Three Months Ended
September 30,

       
    2004
  2003
       
            % of           % of        
    Amount
  Revenues
  Amount
  Revenues
  $ Change
  % Change
Video
  $ 113.1       78.0 %   $ 111.7       81.4 %   $ 1.4       1.3 %
Data
    21.9       15.1 %     16.9       12.3 %     5.0       29.6 %
Advertising
    10.0       6.9 %     8.6       6.3 %     1.4       16.3 %
 
   
 
     
 
     
 
     
 
     
 
     
 
 
 
  $ 145.0       100.0 %   $ 137.2       100.0 %   $ 7.8       5.7 %
 
   
 
     
 
     
 
     
 
     
 
     
 
 

     Video revenues represent monthly subscription fees charged to customers for our core cable television products and services (including basic, expanded basic and analog premium programming, digital cable television programming services, wire maintenance, equipment rental and services to commercial establishments), pay-per-view charges, installation and reconnection fees, late payment fees, and other ancillary revenues. Data revenues primarily represent monthly subscription fees charged to customers for our data products and services and equipment rental fees. Franchise fees charged to customers for payment to local franchising authorities are included in their corresponding revenue category.

     Revenues rose 5.7%, largely attributable to an increase in broadband data customers and basic rate increases applied to our video customers, driven in large part by our own video programming cost increases, offset by a reduction in video subscribers during the period.

     Video revenues increased 1.3% as a result of the aforementioned basic rate increases, partially offset by a decline in basic subscribers from 821,000 to 780,000. Digital customers, at 228,000, were down compared to 239,000 a year ago. Our loss in video subscribers resulted primarily from increased competitive pressures by DBS service providers, particularly in those markets where we experienced their “local-into-local” launches and, to a lesser extent, from our tighter customer credit policies. To reverse this video subscriber trend, we have been increasing our customer retention efforts and our emphasis on product bundling, enhancing and differentiating our video products and services with new digital packages, video-on-demand, high-definition television, digital video recorders and more local programming.

     Data revenues rose 29.6% due primarily to an increase in data customers from 148,000 to 197,000. Average monthly data revenue per data customer decreased 4.2% from $40.15 to $38.45 due to growth of lower-priced, slower speed data customers, as well as the discounting associated with our bundling of digital and data services.

     Advertising revenues increased 16.3%, as a result of stronger local advertising market and an increase in political advertising sales.

  Costs and Expenses

     Service costs include: fees paid to programming suppliers; expenses related to wages and salaries of technical personnel who maintain our cable network and perform customer installation activities; broadband data access costs, including costs of bandwidth connectivity, customer provisioning and technical support and plant operating costs, such as utilities and pole rental expense. Programming costs, which are payments to programmers for content and are generally paid on a per subscriber basis, have historically increased due to both increases in the rates charged for existing programming services and the introduction of new programming services to our basic subscribers.

     Service costs increased 6.8% over the prior year. Of this increase, 36.0% was due to increased programming costs related to rate increases on basic and, to a lesser extent, premium services, offset in part by a reduction in video subscribers, 26.4% was due to greater expensing of labor and overhead costs resulting from the transition from upgrade construction to maintenance activities, 16.5% was due to increased use

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of outside contractors to service our customers, and 13.2% was due to servicing the growth in our data customers. As a percentage of revenues, service costs were 38.8% and 38.3% for the three months ended September 30, 2004 and September 30, 2003, respectively.

     Selling, general and administrative expenses include: wages and salaries for our call center, customer service and support and administrative personnel; franchise fees and taxes; and expenses related to billing, telecommunications, marketing, bad debt, advertising and office administration.

     Selling, general and administrative expenses increased 6.0%. Of this increase, 57.9% was due to higher marketing costs for new programs instituted during the quarter, 37.9% was due to greater expensing of labor and overhead costs resulting from the transition from upgrade construction to maintenance activities, and 31.7% was due to higher advertising commissions as well as higher production costs, partially offset by a decrease in bad debt. As a percentage of revenues, selling, general and administrative expenses were 22.1% for the three months ended September 30, 2004 and 2003.

     We expect continued revenue growth in advanced services, which include digital cable and broadband data access and, in the first half of 2005, the launch of VoIP telephony service. As a result, we expect our service costs and selling, general and administrative expenses to increase.

     Management fee expense reflects charges incurred under our management arrangements with our parent, Mediacom Communications Corporation (“MCC”). Management fee expense increased 16.2% to $2.8 million for the three months ended September 30, 2004, as compared to $2.4 million the three months ended September 30, 2003. This increase reflects greater overhead costs charged by MCC during the three month period ended September 30, 2004. As a percentage of revenues, management fee expense was 1.9% for the three months ended September 30, 2004, as compared with 1.8% for the three months ended September 30, 2003.

     Depreciation and amortization increased 7.9% to $27.0 million for the three months ended September 30, 2004, as compared to $25.0 million for the three months ended September 30, 2003. This increase is due to investments in our cable network and ongoing investments to continue the rollout of products and services such as video-on-demand, high-definition television, digital video recorders and broadband data access. See Note 2 to our unaudited consolidated financial statements.

  Interest Expense, Net

     Interest expense, net, increased 6.7% to $21.9 million for the three months ended September 30, 2004, as compared to $20.5 million for the three months ended September 30, 2003. This increase was primarily due to lower interest expense capitalization for the three months ended September 30, 2004 associated with the substantial reduction of upgrade/rebuild capital expenditures, as well as higher market interest rates on variable rate debt.

  (Loss) Gain on Derivatives, Net

     We enter into interest rate exchange agreements, or “interest rate swaps”, with counterparties to fix the interest rate on a portion of our variable rate debt to reduce the potential volatility in our interest expense that would otherwise result from changes in market interest rates. As of September 30, 2004 we had interest rate swaps with an aggregate principal amount of $500.0 million. The changes in their mark-to-market values are derived from changes in market interest rates, the decrease in their time to maturity and the creditworthiness of the counterparties. Principally as a result of lower market interest rates at the end of the quarter compared with the beginning, we recorded a loss on derivatives amounting to $2.1 million for the three months ended September 30, 2004, as compared to a net gain on derivatives of $5.4 million for the three months ended September 30, 2003.

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  Other Expense

     Other expense was $1.3 million and $1.9 million for the three months ended September 30, 2004 and 2003, respectively. Other expense primarily represents amortization of deferred financing costs and fees on unused credit commitments.

  Net Income (Loss)

     As a result of the factors described above, we generated net income for the three months ended September 30, 2004 of $1.6 million, as compared to net income of $10.0 million for the three months ended September 30, 2003.

  Operating Income Before Depreciation and Amortization

     OIBDA increased 3.8% to $53.9 million due to a 5.7% increase in revenues, partially offset by a 6.8% increase in service costs and a 6.0% increase in selling, general and administrative expenses. OIBDA, expressed as a percentage of revenues, was 37.2% for the three months ended September 30, 2004, as compared to 37.8% in the year-ago period.

  Nine Months Ended September 30, 2004 Compared to Nine Months Ended September 30, 2003

     The following table sets forth the unaudited consolidated statement of operations for the nine months ended September 30, 2004 and 2003 (dollars in thousands and percentage changes that are not meaningful are marked NM):

                                 
    Nine Months Ended        
    September 30,
       
    2004
  2003
  $ Change
  % Change
Revenues
  $ 436,101     $ 409,474     $ 26,627       6.5 %
Costs and expenses:
                               
Service costs
    167,680       160,208       7,472       4.7 %
Selling, general and administrative expenses
    94,267       86,936       7,331       8.4 %
Management fee expense
    8,206       6,593       1,613       24.5 %
Depreciation and amortization
    80,300       88,010       (7,710 )     (8.8 %)
 
   
 
     
 
     
 
     
 
 
Operating income
    85,648       67,727       17,921       26.5 %
Interest expense, net
    (64,223 )     (61,951 )     (2,272 )     3.7 %
Gain (loss) on derivatives, net
    6,700       (1,970 )     8,670     NM
Other expense
    (3,560 )     (4,232 )     672       (15.9 %)
 
   
 
     
 
     
 
     
 
 
Net income (loss)
  $ 24,565     $ (426 )   $ 24,991     NM
 
   
 
     
 
     
 
     
 
 
OIBDA
  $ 165,948     $ 155,737     $ 10,211       6.6 %

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  Revenues

     The following table sets forth revenue information for the nine months ended September 30, 2004 and 2003 (dollars in millions):

                                                        
    Nine Months Ended
September 30,

       
    2004
  2003
       
            % of           % of        
    Amount
  Revenues
  Amount
  Revenues
  $ Change
  % Change
Video
  $ 345.2       79.2 %   $ 337.7       82.5 %   $ 7.5       2.2 %
Data
    63.8       14.6 %     46.7       11.4 %     17.1       36.6 %
Advertising
    27.1       6.2 %     25.1       6.1 %     2.0       8.0 %
 
   
 
     
 
     
 
     
 
     
 
     
 
 
 
  $ 436.1       100.0 %   $ 409.5       100.0 %   $ 26.6       6.5 %
 
   
 
     
 
     
 
     
 
     
 
     
 
 

     Revenues rose 6.5%, largely attributable to an increase in broadband data customers and basic rate increases applied on our video customers, driven in large part by our own video programming cost increases, offset by a reduction in video subscribers during the period.

     Video revenues increased 2.2% as a result of the aforementioned basic rate increases, partially offset by a decline in basic subscribers from 821,000 to 780,000. Digital customers, at 228,000, were down compared to 239,000 a year ago. Our loss in video subscribers resulted primarily from increased competitive pressures by DBS service providers, particularly in those markets where we experienced their “local-into-local” launches, and to a lesser extent from our tighter customer credit policies. To reverse this video subscriber trend, we have been increasing our customer retention efforts and our emphasis on product bundling, enhancing and differentiating our video products and services with new digital service packages, video-on-demand, high-definition television, digital video recorders and more local programming.

     Data revenues rose 36.6% due primarily to an increase in data customers from 148,000 to 197,000. Average monthly data revenue per data customer decreased 0.6% from $40.23 to $39.97 due to growth of lower-priced, slower speed data customers, as well as the discounting associated with our bundling of digital and data services.

     Advertising revenues increased 8.0%, with stronger local advertising sales.

  Costs and Expenses

     Service costs increased 4.7% over the prior year. Of this increase, 37.5% was due to servicing the growth in our data customers, 31.9% was due to greater expensing of labor and overhead costs resulting from the transition from upgrade construction to maintenance activities, 6.7% was due to increased use of contractors to service our customers, and the remainder was due to other operating costs related to servicing our customers. As a percentage of revenues, service costs were 38.4% and 39.1% for the nine months ended September 30, 2004 and September 30, 2003, respectively.

     Selling, general and administrative expenses increased 8.4%. Of this increase, 37.9% was due to higher marketing costs for new programs instituted during the quarter, 18.7% was due to an increase in employee costs, 17.6% was due to higher advertising expense related to both in-house advertising and proprietary programming cost increases, and 16.8% was due to greater expensing of labor and overhead costs resulting from the transition from upgrade construction to maintenance activities. As a percentage of revenues, selling, general and administrative expenses were 21.6% for the nine months ended September 30, 2004, as compared with 21.2% for the nine months ended September 30, 2003.

     We expect continued revenue growth in advanced services, which include digital cable and broadband data access and, in the first half of 2005, the launch of VoIP telephony service. As a result, we expect our service costs and selling, general and administrative expenses to increase.

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     Management fee expense reflects charges incurred under our management arrangements with our parent, Mediacom Communications Corporation (“MCC”). Management fee expense increased 24.5% to $8.2 million for the nine months ended September 30, 2004, as compared to $6.6 million the nine months ended September 30, 2003. This increase reflects greater overhead costs charged by MCC during the nine month period ended September 30, 2004. As a percentage of revenues, management fee expense was 1.9% for the nine months ended September 30, 2004, as compared with 1.6% for the nine months ended September 30, 2003.

     Depreciation and amortization decreased 8.8% to $80.3 million for the nine months ended September 30, 2004, as compared to $88.0 million for the nine months ended September 30, 2003. The decrease was primarily due to changes, effective July 1, 2003, in the estimated useful lives of our cable systems and equipment in conjunction with the completion of our network upgrade and rebuild program. These changes reduced depreciation by $22.7 million and $11.1 million for the nine months ended September 30, 2004 and 2003, respectively. This decrease in the 2004 period was offset in part by increased depreciation for investments in our cable network and ongoing investments to continue the rollout of products and services such as video-on-demand, high-definition television, digital video recorders and broadband data access. See Note 2 to our unaudited consolidated financial statements.

  Interest Expense, Net

     Interest expense, net, increased 3.7% to $64.2 million for the nine months ended September 30, 2004, as compared to $62.0 million for the nine months ended September 30, 2003. This increase was primarily due to lower interest expense capitalization for the nine months ended September 30, 2004, associated with the substantial reduction of upgrade/rebuild capital expenditures, as well as higher market interest rates on variable rate debt.

  Gain (Loss) on Derivatives, Net

     We enter into interest rate exchange agreements, or “interest rate swaps”, with counterparties to fix the interest rate on a portion of our variable rate debt to reduce the potential volatility in our interest expense that would otherwise result from changes in market interest rates. As of September 30, 2004 we had interest rate swaps with an aggregate principal amount of $500.0 million. The changes in their mark-to-market values are derived from changes in market interest rates, the decrease in their time to maturity and the creditworthiness of the counterparties. Principally as a result of higher market interest rates at the end of the period compared with the beginning, we recorded a net gain on derivatives amounting to $6.7 million for the nine months ended September 30, 2004, as compared to a loss on derivatives amounting to $2.0 million for the nine months ended September 30, 2003.

  Other Expense

     Other expense was $3.6 million and $4.2 million for the nine months ended September 30, 2004 and 2003, respectively. Other expense primarily represents amortization of deferred financing costs and fees on unused credit commitments.

  Net Income (Loss)

     As a result of the factors described above, we generated net income for the nine months ended September 30, 2004 of $24.6 million, as compared to a net loss of $0.4 million for the nine months ended September 30, 2003.

  Operating Income Before Depreciation and Amortization

     OIBDA increased 6.6% to $165.9 million due to a 6.5% increase in revenues, partially offset by a 4.7% increase in service costs and an 8.4% increase in selling, general and administrative expenses. OIBDA, expressed as a percentage of revenues, was 38.1% for the nine months ended September 30, 2004, as compared to 38.0% in the year-ago period.

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Liquidity and Capital Resources

  Uses of Cash

     As an integral part of our business plan, we have significantly invested, and will continue to invest, additional capital in our cable network to enhance its reliability and capacity, which will allow for the introduction of new advanced broadband services. We plan to continue to pursue a business strategy that includes selective acquisitions. We also pay quarterly cash dividends to Mediacom LLC, a wholly owned subsidiary of MCC that has a $150.0 million preferred equity investment in our Company with a 12% annual dividend payable quarterly in cash. For the nine months ended September 30, 2004, we made capital expenditures of $61.6 million and paid in aggregate $13.5 million of cash dividends to Mediacom LLC.

  Sources of Cash

     We expect to fund our capital requirements and operations through a combination of internally generated funds and amounts available under our bank credit facilities. For the nine months ended September 30, 2004, net cash flows provided by operating activities amounted to $63.9 million and net borrowings were $5.9 million.

  Other

     Our operating subsidiaries have a $1.4 billion credit facility expiring in September 2010, of which $956.8 million was outstanding as of September 30, 2004. We have entered into interest rate exchange agreements with counterparties, which expire from September 2005 through March 2007, to hedge $500.0 million of floating rate debt. Under the terms of all of our interest rate exchange agreements, we are exposed to credit loss in the event of nonperformance by the other parties of the agreements. However, due to the high creditworthiness of our counterparties, which are major banking firms rated investment grade, we do not anticipate their nonperformance. As of September 30, 2004, about 66% of our outstanding indebtedness was at fixed interest rates or subject to interest rate protection.

     As of September 30, 2004, our total debt was $1.36 billion and we were in compliance with all covenants under our debt arrangements. On the same date our annualized cost of debt capital was approximately 6.5% and we had unused credit commitments of about $430.9 million, of which $283.1 million could be borrowed and used for general corporate purposes based on the most restrictive terms and conditions of our debt arrangements.

     As of September 30, 2004, approximately $8.1 million of letters of credit were issued to various parties to secure our performance relating to insurance and franchise requirements.

     Although we have not generated earnings sufficient to cover fixed charges in the past, we have generated cash and obtained financing sufficient to meet our short-term requirements, including our debt service, working capital and capital expenditures. We expect that we will continue to be able to generate funds and obtain financing sufficient to meet our long-term business plan, service our debt obligations and complete our future acquisitions. However, there can be no assurance that we will be able to obtain sufficient financing, or, if we were able to do so, that the terms would be favorable to us.

Critical Accounting Policies

     The foregoing discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Periodically we evaluate our estimates, including those related to doubtful accounts, long-lived assets, capitalized costs and accruals. We base our estimates on historical experience and on various other assumptions that we believe are reasonable. Actual results may differ from these estimates under different assumptions or conditions.

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     We believe the following represent the most significant and subjective estimates used in the preparation of our consolidated financial statements:

  Property, Plant and Equipment

     In accordance with Statement of Financial Accounting Standards (‘SFAS”) No. 51, “Financial Reporting by Cable Television Companies,” we capitalize a portion of direct and indirect costs related to the construction, replacement and installation of property, plant and equipment, including certain costs related to new video and new broadband data subscriber installations. Capitalized costs are recorded as additions to property, plant and equipment and depreciated over the life of the related assets. We perform periodic evaluations of the estimates used to determine the amount of costs that are capitalized. Any changes to these estimates, which may be significant, are applied in the period in which the evaluations were completed.

  Goodwill and Other Intangible Assets

     In accordance with SFAS No. 142, “Goodwill and Other Intangible Assets”, the amortization of goodwill and indefinite-lived intangible assets is prohibited and requires such assets to be tested annually for impairment, or more frequently if impairment indicators arise. We have determined that our cable franchise costs are indefinite-lived assets. Our annual impairment tests, performed in the fourth quarter of 2003, based on financial information as of September 30, 2003, determined that there was no impairment of goodwill or indefinite-lived intangible assets. There have been no events since then that would require an analysis to be completed before the annual test date.

Inflation and Changing Prices

     Our systems’ costs and expenses are subject to inflation and price fluctuations. Such changes in costs and expenses can generally be passed through to subscribers. Programming costs have historically increased at rates in excess of inflation and are expected to continue to do so. We believe that under the Federal Communications Commission’s existing cable rate regulations we may increase rates for cable television services to more than cover any increases in programming. However, competitive conditions and other factors in the marketplace may limit our ability to increase our rates.

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ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     In the normal course of business, we use interest rate exchange agreements, or “swaps”, with counterparties to fix the interest rate on our floating rate debt. As of September 30, 2004, we had interest rate exchange agreements with various banks pursuant to which the interest rate on $500.0 million is fixed at a weighted average rate of approximately 3.4%. The fixed rates of the swap agreements are offset against the applicable three-month London Interbank Offering Rates to determine the interest expense related to these agreements. Under the terms of the interest rate exchange agreements, which expire from 2005 through 2007, we are exposed to credit loss in the event of nonperformance by the other parties. However, due to the high creditworthiness of our counterparties, which are major banking firms rated investment grade, we do not anticipate their nonperformance. At September 30, 2004, based on the mark-to-market valuation, we would have paid approximately $5.5 million, including accrued interest, if we terminated these agreements.

     The table below provides the expected maturity and estimated fair value of our debt as of September 30, 2004 (dollars in thousands). See Note 6 to our unaudited consolidated financial statements.

                                 
            Bank Credit   Capital Lease    
    Senior Notes
  Facilities
  Obligations
  Total
Expected Maturity:
                               
October 1, 2004 to September 30, 2005
  $     $ 30,500     $ 1,305     $ 31,805  
October 1, 2005 to September 30, 2006
          40,625       1,347       41,972  
October 1, 2006 to September 30, 2007
          59,375       1,031       60,406  
October 1, 2007 to September 30, 2008
          65,000       101       65,101  
October 1, 2008 to September 30, 2009
          153,625             153,625  
Thereafter
    400,000       607,625             1,007,625  
 
   
 
     
 
     
 
     
 
 
Total
  $ 400,000     $ 956,750     $ 3,784     $ 1,360,534  
 
   
 
     
 
     
 
     
 
 
Fair Value
  $ 426,000     $ 956,750     $ 3,784     $ 1,386,534  
 
   
 
     
 
     
 
     
 
 
Weighted Average Interest Rate
    11.0 %     3.8 %     3.1 %     5.9 %
 
   
 
     
 
     
 
     
 
 

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ITEM 4.  CONTROLS AND PROCEDURES

Mediacom Broadband LLC

     The management of Mediacom Broadband LLC (“Mediacom Broadband”) carried out an evaluation, with the participation of the Mediacom Broadband’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of Mediacom Broadband’s disclosure controls and procedures as of September 30, 2004. Based upon that evaluation, Mediacom Broadband’s Chief Executive Officer and Chief Financial Officer concluded that Mediacom Broadband’s disclosure controls and procedures were effective to ensure that information required to be disclosed by Mediacom Broadband in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

     There has not been any change in Mediacom Broadband’s internal control over financial reporting in connection with the evaluation required by Rule 15d-15(d) under the Exchange Act that occurred during the quarter ended September 30, 2004 that has materially affected, or is reasonably likely to materially affect, Mediacom Broadband’s internal control over financial reporting.

Mediacom Broadband Corporation

     The management of Mediacom Broadband Corporation carried out an evaluation, with the participation of the Mediacom Broadband Corporation’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of Mediacom Broadband Corporation’s disclosure controls and procedures as of September 30, 2004. Based upon that evaluation, Mediacom Broadband Corporation’s Chief Executive Officer and Chief Financial Officer concluded that Mediacom Broadband Corporation’s disclosure controls and procedures were effective to ensure that information required to be disclosed by Mediacom Broadband in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

     There has not been any change in Mediacom Broadband Corporation’s internal control over financial reporting in connection with the evaluation required by Rule 15d-15(d) under the Exchange Act that occurred during the quarter ended September 30, 2004 that has materially affected, or is reasonably likely to materially affect, Mediacom Broadband Corporation’s internal control over financial reporting.

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PART II

ITEM 1.  LEGAL PROCEEDINGS

     See Note 8 to our consolidated financial statements.

ITEM 6.  EXHIBITS
     
Exhibit    
Number
  Exhibit Description
31.1
  Rule 15d-14(a) Certifications of Mediacom Broadband LLC
31.2
  Rule 15d-14(a) Certifications of Mediacom Broadband Corporation
32.1
  Section 1350 Certifications of Mediacom Broadband LLC
32.2
  Section 1350 Certifications of Mediacom Broadband Corporation

21


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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

         
  MEDIACOM BROADBAND LLC
 
 
November 9, 2004  By:   /s/ Mark E. Stephan    
    Mark E. Stephan   
      Executive Vice President and
  Chief Financial Officer 
 

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Table of Contents

         

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

         
  MEDIACOM BROADBAND CORPORATION
 
 
November 9, 2004  By:   /s/ Mark E. Stephan    
    Mark E. Stephan   
      Executive Vice President and
  Chief Financial Officer 
 

23

EXHIBIT 31.1
 

         

Exhibit 31.1

CERTIFICATIONS

I, Rocco B. Commisso, certify that:

(1)   I have reviewed this report on Form 10-Q of Mediacom Broadband LLC;
 
(2)   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
(3)   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
(4)   The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

  a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
  b)   Paragraph omitted pursuant to SEC Release Nos. 33-8238 and 34-47986
 
  c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of end of the period covered by this report based on such evaluation; and
 
  d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5)   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

  a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
 
  b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
         
     
November 9, 2004  By:   /s/ Rocco B. Commisso    
    Rocco B. Commisso   
      Chief Executive Officer   


 

         

Exhibit 31.1

CERTIFICATIONS

I, Mark E. Stephan, certify that:

(1)   I have reviewed this report on Form 10-Q of Mediacom Broadband LLC;
 
(2)   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
(3)   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
(4)   The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

  a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
  b)   Paragraph omitted pursuant to SEC Release Nos. 33-8238 and 34-47986
 
  c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of end of the period covered by this report based on such evaluation; and
 
  d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5)   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

  a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
 
  b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
         
     
November 9, 2004  By:   /s/ Mark E. Stephan    
    Mark E. Stephan   
      Chief Financial Officer   

EXHIBIT 31.2
 

         

Exhibit 31.2

CERTIFICATIONS

I, Rocco B. Commisso, certify that:

(1)   I have reviewed this report on Form 10-Q of Mediacom Broadband Corporation;
 
(2)   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
(3)   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
(4)   The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

  a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
  b)   Paragraph omitted pursuant to SEC Release Nos. 33-8238 and 34-47986
 
  c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of end of the period covered by this report based on such evaluation; and
 
  d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5)   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

  a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
 
  b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
         
     
November 9, 2004  By:   /s/ Rocco B. Commisso    
    Rocco B. Commisso   
      Chief Executive Officer   


 

         

Exhibit 31.2

CERTIFICATIONS

I, Mark E. Stephan, certify that:

(1)   I have reviewed this report on Form 10-Q of Mediacom Broadband Corporation;
 
(2)   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
(3)   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
(4)   The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

  a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
  b)   Paragraph omitted pursuant to SEC Release Nos. 33-8238 and 34-47986
 
  c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of end of the period covered by this report based on such evaluation; and
 
  d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5)   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

  a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
 
  b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
         
     
November 9, 2004  By:   /s/ Mark E. Stephan    
    Mark E. Stephan   
      Chief Financial Officer   

EXHIBIT 32.1
 

         

Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report of Mediacom Broadband LLC (the “Company”) on Form 10-Q for the period ended September 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Rocco B. Commisso, Chief Executive Officer and Mark E. Stephan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

  (1)   the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
  (2)   the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
         
     
November 9, 2004  By:   /s/ Rocco B. Commisso    
    Rocco B. Commisso   
      Chief Executive Officer   
 
     
  By:   /s/ Mark E. Stephan    
    Mark E. Stephan   
      Chief Financial Officer   

EXHIBIT 32.2
 

         

Exhibit 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report of Mediacom Broadband Corporation (the “Company”) on Form 10-Q for the period ended September 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Rocco B. Commisso, Chief Executive Officer and Mark E. Stephan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

  (1)   the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
  (2)   the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
         
     
November 9, 2004  By:   /s/ Rocco B. Commisso    
    Rocco B. Commisso   
      Chief Executive Officer   
 
     
  By:   /s/ Mark E. Stephan    
    Mark E. Stephan   
      Chief Financial Officer