UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of earliest event reported): August 9, 2006

MEDIACOM COMMUNICATIONS CORPORATION

(Exact name of Registrant as specified in its charter)

Delaware		0-29227		06-1566067
(State of incorporation)		(Commission File No.)		(IRS Employer Identification No.)

100 Crystal Run Road
Middletown, New York 10941
(Address of principal executive offices)

Registrant’s telephone number: (845) 695-2600

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02. Results of Operations and Financial Condition.

     On August 9, 2006, Mediacom Communications Corporation issued a press release announcing its financial results for the quarter ended June 30, 2006. A copy of the press release is being furnished as Exhibit 99.1 to this report and incorporated herein by reference.

     The press release contains disclosure of adjusted operating income before depreciation and amortization (“Adjusted OIBDA”) and free cash flow, which are not measures of performance calculated in accordance with generally accepted accounting principles (GAAP) in the United States. Reconciliations of Adjusted OIBDA and free cash flow to the most directly comparable financial measures calculated and presented in accordance with GAAP are presented in Attachment 6 to the press release. Disclosure regarding management’s reasons for presenting Adjusted OIBDA and free cash flow appears on page 4 of the press release.

Item 9.01. Financial Statements and Exhibits.

(a)		Financial Statements of Businesses Acquired — None
(b)		Pro Forma Financial Information — None
(c)		Shell Company Transactions — None
(d)		Exhibits:

Exhibit No.				Description
	99.1			Press release issued by the Registrant on August 9, 2006

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 hereunto duly authorized.

Dated: August 9, 2006

For Immediate Release

Mediacom Communications Reports Results
for Second Quarter 2006

Middletown, NY – August 9, 2006 – MEDIACOM COMMUNICATIONS CORPORATION (Nasdaq: MCCC) today reported financial results for the three months ended June 30, 2006. The Company will hold a teleconference to discuss its second quarter 2006 results today at 10:30 a.m. Eastern Time. A live broadcast of the Company’s teleconference can be accessed through the Company web site at www.mediacomcc.com.

Second Quarter 2006 Financial Highlights

	•		Revenues of $302.4 million, an increase of 9.0% over Q2 2005
	•		Adjusted operating income before depreciation and amortization (“Adjusted OIBDA”) of $114.9 million, an increase of 8.5% over Q2 2005 1
	•		Operating income of $59.9 million, an increase of 15.6% over Q2 2005
	•		Total revenue generating units (“RGUs”) of 2,478,000, a gain of 9,000 during the quarter and an increase of 6.5% from Q2 2005
	•		Total monthly revenue per basic subscriber of $71.44, an increase of 12.3% over Q2 2005

Revised Full Year 2006 Financial Guidance

Based on the strength of its first-half 2006 financial performance, the Company is increasing its full-year 2006 financial guidance as follows:

	•		Revenue growth increased to a range of 9 – 10%; previously 8 – 9%
	•		Adjusted OIBDA growth increased to a range of 9 – 10%; previously 7 – 8%
	•		Capital expenditures increased to approximately $210 million; previously approximately $200 million

“In the second quarter, Mediacom delivered stronger than expected financial performance, putting us on a path to exceed our previously announced financial guidance for full-year 2006,” said Rocco B. Commisso, Mediacom’s Chairman and CEO. “Despite soft RGU growth in this seasonally weak period, we achieved the highest year-over-year growth rate in both revenues and Adjusted OIBDA since the second quarter of 2003.”

“Our results in large part reflect the significant investments we have made over the years to launch advanced broadband services. This quarter, combined revenues from our data and phone businesses represented 21% of total revenues, and grew by 33% year-over-year. Further enhancements to our data offerings and the continuing roll-out of our phone product across most of our markets should ensure a healthy contribution by these advanced services to overall revenue growth,” concluded Mr. Commisso.

Three Months Ended June 30, 2006 Compared to Three Months Ended June 30, 2005

For the second quarter of 2006, revenues were $302.4 million, an increase of 9.0% over $277.3 million in the comparable 2005 period.

	•		Video revenues grew 3.2%, as a result of higher service fees from advanced video products and services and basic rate increases applied on video subscribers. As expected, the number of basic cable subscribers declined during the second quarter mostly due to seasonal disconnects associated with the number of markets the Company serves in university communities. During the second quarter, the Company lost 22,000 basic subscribers compared to a loss of 15,000 for the same period last year. Average monthly video revenue per basic subscriber grew 6.3% from the second quarter of 2005 to $52.65.
	•		Data revenues rose 20.6%, primarily due to a 21.1% year-over-year increase in data customers. Average monthly data revenue per customer decreased 1.5% from the prior year period to $37.79 as a result of promotional offers during 2005, but increased 1.0% sequentially from the first quarter of 2006 as a result of the expiration of longer-term promotions.
	•		Phone revenues grew 58.8% from the previous quarter to $5.8 million. As of June 30, 2006, the Company served 66,000 phone customers, and Mediacom Phone was marketed to approximately 1.7 million of the Company’s 2.8 million estimated homes passed.
	•		Advertising revenues increased 18.5%, largely as a result of stronger local advertising sales.

Operating costs grew 9.4%, primarily due to increases in programming and employee expenses and phone and data customer growth. As a result, Adjusted OIBDA rose 8.5%. Operating income increased 15.6%, principally due to growth in Adjusted OIBDA and relatively unchanged depreciation and amortization expense compared to the second quarter of 2005.

Liquidity and Capital Resources

The Company has included the Condensed Statements of Cash Flows for the six months ended June 30, 2006 and 2005 in Attachment 4 to provide more details regarding its liquidity and capital resources.

Significant sources of cash for the six months ended June 30, 2006 were:

	•		Generation of net cash flows from operating activities of approximately $107.7 million; and
	•		Net borrowings of about $235.4 million under the Company’s bank credit facilities.

Significant uses of cash for the six months ended June 30, 2006 were:

	•		Capital expenditures of $104.8 million;
	•		Repayment of $172.5 million of 5.25% convertible senior notes due July 1, 2006; and
	•		Repurchases of approximately 5.8 million shares of Class A common stock for $34.4 million.

Free Cash Flow, as defined by the Company below, was positive $5.1 million in the first half of 2006, as compared to negative $8.4 million in the prior year period.

Financing Transactions

On May 5, 2006, the Company refinanced two term loans with aggregate amounts outstanding of about $1.04 billion with two new term loans totaling $1.4 billion. Borrowings under the new term loans bear interest at rates that are 0.25% to 0.50% lower than the term loans they replaced. The new term loans mature in January 2015, whereas the term loans that they replaced had maturities of February 2013 and February 2014.

On June 29, 2006, the Company repaid its $172.5 million aggregate principal amount 5.25% convertible senior notes due July 1, 2006. The Company funded the repayment with proceeds from the new term loan financings.

On July 17, 2006, the Company redeemed all of its outstanding $400.0 million aggregate principal amount 11% senior notes due 2013 (the “11% Notes”) at a redemption price of 105.5%. The Company funded the redemption with drawdowns on the revolving credit portions of its subsidiary credit facilities.

Financial Position

At June 30, 2006, the Company had total debt outstanding of $3,122.5 million. As of the same date, the Company had unused credit commitments of approximately $1,006.3 million, of which approximately $868.4 million could be borrowed and used for general corporate purposes based on the terms and conditions of the Company’s debt arrangements.

As of June 30, 2006, after giving effect to the redemption of the 11% Notes, the Company had unused credit commitments of approximately $597.3 million, of which approximately $459.4 million could be borrowed and used for general corporate purposes based on the terms and conditions of the Company’s debt arrangements.

Stock Repurchase Program and Activity

During the three months ended June 30, 2006, the Company repurchased approximately 1.96 million shares of its Class A Common Stock for an aggregate cost of $12.4 million. During the six months ended June 30, 2006, the Company repurchased approximately 5.82 million shares for an aggregate cost of $34.4 million. As of June 30, 2006, approximately $39.0 million remains available under the Company’s stock repurchase program.

Use of Non-GAAP Financial Measures

“Adjusted OIBDA” and “Free Cash Flow” are not financial measures calculated in accordance with generally accepted accounting principles (GAAP) in the United States. The Company defines Adjusted OIBDA as operating income before depreciation and amortization and non-cash, share-based compensation charges, and defines Free Cash Flow as Adjusted OIBDA less interest expense, net, cash taxes and capital expenditures.

Adjusted OIBDA is one of the primary measures used by management to evaluate the Company’s performance and to forecast future results. The Company believes Adjusted OIBDA is useful for investors because it enables them to assess the Company’s performance in a manner similar to the methods 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, as well as different non-cash, share-based compensation programs. A limitation of Adjusted OIBDA, 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 the Company’s business. Management utilizes a separate process to budget, measure and evaluate capital expenditures. In addition, Adjusted OIBDA has the limitation of not reflecting the effect of the Company’s non-cash, share-based compensation charges.

Free Cash Flow is used by management to evaluate the Company’s ability to service its debt and to fund continued growth with internally generated funds. The Company believes Free Cash Flow is useful for investors because it enables them to assess the Company’s ability to service its debt and to fund continued growth with internally generated funds in a manner similar to the method used by management, and provide measures that can be used to analyze, value and compare companies in the cable television industry. The Company’s definition of Free Cash Flow eliminates the impact of quarterly working capital fluctuations, most notably from the timing of semi-annual cash interest payments on the Company’s senior notes.

Adjusted OIBDA and Free Cash Flow should not be regarded as alternatives to either operating income, net income or net loss as indicators of operating performance or to the statement of cash flows as measures of liquidity, nor should they be considered in isolation or as substitutes for financial measures prepared in accordance with GAAP. The Company believes that operating income is the most directly comparable GAAP financial measure to Adjusted OIBDA, and that net cash flows provided by operating activities is the most directly comparable GAAP financial measure to Free Cash Flow. Reconciliations of historical presentations of Adjusted OIBDA and Free Cash Flow to their most directly comparable GAAP financial measures are provided in Attachment 6. The Company is unable to reconcile these non-GAAP measures to their most directly comparable non-GAAP measures on a forward-looking basis primarily because it is impractical to project the timing of certain items, such as the initiation of depreciation relative to network construction projects, or changes in working capital.

Company Description

Mediacom Communications is the nation’s 8th largest cable television company, and among the leading cable operators focused on serving the smaller cities and towns in the United States. Mediacom Communications offers a wide array of broadband products and services, including traditional video services, digital television, video-on-demand, digital video recorders, high-definition television, high-speed Internet access and phone service. More information about Mediacom Communications can be accessed on the Internet at: www.mediacomcc.com.

Forward Looking Statements

Any statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify those 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. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from historical results or those the Company anticipates. Factors that could cause actual results to differ from those contained in the forward-looking statements include, but are not limited to: competition in the Company’s video, high-speed Internet access and phone businesses; the Company’s ability to achieve anticipated customer and revenue growth and to successfully introduce new products and services; increasing programming costs; changes in laws and regulations; the Company’s ability to generate sufficient cash flow to meet its debt service obligations and to access capital to maintain financial flexibility; and the other risks and uncertainties described in the Company’s annual report on Form 10-K for the year ended December 31, 2005 and the other reports and documents the Company files from time to time with the Securities and Exchange Commission. Statements included in this press release are based upon information known to the Company as of the date of this press release, and the Company assumes no obligation to (and expressly disclaims any such obligation to) publicly update or alter its forward-looking statements made in this press release, whether as a result of new information, future events or otherwise, except as otherwise required by applicable federal securities laws.

Tables:				Contact:
		(1) Actual Results – Three-Month Periods		Investor Relations
		(2) Actual Results – Six-Month Periods		Matt Derdeyn
		(3) Condensed Consolidated Balance Sheets		Group Vice President,
		(4) Condensed Statements of Cash Flows		Corporate Finance and Treasurer
		(5) Capital Expenditure Data		(845) 695-2612
		(6) Reconciliation Data – Historical		Media Relations
		(7) Calculation – Free Cash Flow		Marvin Rappaport
		(8) Summary Operating Statistics		Vice President,
				Governmental Relations
				(845) 695-2704

(1) Actual Results – Three-Month Periods

Consolidated Statements of Operations
(All amounts in thousands, except per share data)
(Unaudited)

		Three Months Ended
		June 30,								Percent
		2006				2005				Change
Video		$	222,863			$	215,948				3.2	%
Data			57,816				47,921				20.6
Phone			5,793				—				NM
Advertising			15,949				13,463				18.5
Total revenues			302,421				277,332				9.0
Service costs			121,886				107,797				13.1	%
SG&A expenses			60,428				58,291				3.7
Corporate expenses			5,175				5,334				(3.0	)
Total operating costs			187,489				171,422				9.4
Adjusted OIBDA			114,932				105,910				8.5	%
Non-cash, share-based compensation charges			898				390				NM
Depreciation and amortization			54,184				53,754				0.8
Operating income			59,850				51,766				15.6	%
Interest expense, net			(56,890	)			(50,136	)			13.5
Loss on early extinguishment of debt			(7,532	)			(4,742	)			NM
Gain (loss) on derivatives, net			807				(1,649	)			NM
Gain on sale of assets and investments, net			—				1,183				NM
Other expense, net			(2,983	)			(2,533	)			17.8
Loss before benefit from income taxes			(6,748	)			(6,111	)			NM
Benefit from income taxes			12,473				122				NM
Net income (loss)		$	5,725			$	(5,989	)			NM
Basic weighted average shares outstanding			110,922				117,488
Basic income (loss) per share		$	0.05			$	(0.05	)
Diluted weighted average shares outstanding			112,476				117,488
Diluted income (loss) per share		$	0.05			$	(0.05	)
Adjusted OIBDA margin (a)			38.0	%			38.2	%
Operating income margin (b)			19.8	%			18.7	%

(2) Actual Results – Six-Month Periods

Consolidated Statements of Operations
(All amounts in thousands, except per share data)
(Unaudited)

		Six Months Ended
		June 30,								Percent
		2006				2005				Change
Video		$	440,091			$	425,728				3.4	%
Data			112,906				92,947				21.5
Phone			9,442				—				NM
Advertising			29,330				24,901				17.8
Total revenues			591,769				543,576				8.9
Service costs			240,276				213,854				12.4	%
SG&A expenses			118,543				114,189				3.8
Corporate expenses			10,449				10,499				(0.5	)
Total operating costs			369,268				338,542				9.1
Adjusted OIBDA			222,501				205,034				8.5	%
Non-cash, share-based compensation charges			2,053				541				NM
Depreciation and amortization			107,901				107,679				0.2
Operating income			112,547				96,814				16.3	%
Interest expense, net			(112,542	)			(101,410	)			11.0
Loss on early extinguishment of debt			(7,532	)			(4,742	)			NM
Gain on derivatives, net			1,322				6,421				NM
Gain on sale of assets and investments, net			—				1,183				NM
Other expense, net			(5,624	)			(5,229	)			7.6
Loss before (provision for) benefit from income taxes			(11,829	)			(6,963	)			NM
(Provision for) benefit from income taxes			(19,653	)			132				NM
Net loss		$	(31,482	)		$	(6,831	)			NM
Basic and diluted weighted average shares outstanding			112,218				117,673
Basic and diluted loss per share		$	(0.28	)		$	(0.06	)
Adjusted OIBDA margin (a)			37.6	%			37.7	%
Operating income margin (b)			19.0	%			17.8	%

(3) Condensed Consolidated Balance Sheets

Condensed Consolidated Balance Sheets
(Dollars in thousands)
(Unaudited)

		June 30,				December 31,
		2006				2005
ASSETS
Cash and cash equivalents		$	45,803			$	17,281
Accounts receivable, net			65,959				63,845
Deferred tax assets			3,119				2,782
Prepaid expenses and other assets			26,766				23,046
Total current assets		$	141,647			$	106,954
Investment in cable television systems
Property, plant and equipment, net			1,452,879				1,453,588
Franchise rights, net			1,803,971				1,803,971
Goodwill, net			221,382				221,382
Subscriber lists and other intangible assets, net			12,775				13,823
Total investment in cable television systems		$	3,491,007			$	3,492,764
Other assets, net			42,650				49,780
Total assets		$	3,675,304			$	3,649,498
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Accounts payable and accrued expenses		$	275,218			$	270,137
Deferred revenue			44,608				41,073
Current portion of long-term debt			458,082				222,770
Total current liabilities		$	777,908			$	533,980
Long-term debt, less current portion			2,664,437				2,836,881
Deferred tax liabilities			219,963				200,090
Other non-current liabilities			17,580				19,440
Total stockholders’ (deficit) equity			(4,584	)			59,107
Total liabilities and stockholders’ (deficit) equity		$	3,675,304			$	3,649,498

(4) Condensed Statements of Cash Flows

Condensed Statements of Cash Flows
(Dollars in thousands)
(Unaudited)

		Six Months Ended
		June 30,
		2006				2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash flows provided by operating activities		$	107,727			$	103,126
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures			(104,781	)			(111,878	)
Proceeds from sale of assets and investments			—				2,082
Net cash flows used in investing activities		$	(104,781	)		$	(109,796	)
CASH FLOWS FROM FINANCING ACTIVITIES:
New borrowings			1,581,000				651,750
Repayment of debt			(1,345,632	)			(441,348	)
Repayment/redemption of senior notes			(172,500	)			(200,000	)
Repurchases of common stock			(34,386	)			(6,335	)
Other financing activities – book overdrafts			(3,173	)			(10,223	)
Proceeds from issuance of common stock in employee stock purchase plan			460				477
Financing costs			(193	)			(50	)
Net cash flows provided by (used in) financing activities		$	25,576			$	(5,729	)
Net increase (decrease) in cash and cash equivalents		$	28,522			$	(12,399	)
CASH AND CASH EQUIVALENTS, beginning of period			17,281				23,875
CASH AND CASH EQUIVALENTS, end of period		$	45,803			$	11,476
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for interest, net of amounts capitalized		$	118,845			$	104,984

(5) Capital Expenditure Data

(Dollars in thousands)
(Unaudited)

		Six Months Ended
		June 30,
		2006				2005
Customer premise equipment		$	49,846			$	62,735
Scalable infrastructure			16,544				12,695
Line extensions			6,524				8,702
Upgrade/Rebuild			22,764				19,322
Support capital			9,103				8,424
Total		$	104,781			$	111,878

(6) Reconciliation Data — Historical

Reconciliation of Adjusted OIBDA to Operating Income
(Dollars in thousands)
(Unaudited)

		Three Months Ended
		June 30,
		2006				2005
Adjusted OIBDA		$	114,932			$	105,910
Non-cash, share-based compensation charges			(898	)			(390	)
Depreciation and amortization			(54,184	)			(53,754	)
Operating income		$	59,850			$	51,766

		Six Months Ended
		June 30,
		2006				2005
Adjusted OIBDA		$	222,501			$	205,034
Non-cash, share-based compensation charges			(2,053	)			(541	)
Depreciation and amortization			(107,901	)			(107,679	)
Operating income		$	112,547			$	96,814

(6) Reconciliation Data – Historical (cont)

Reconciliation of Free Cash Flow to Net Cash Flows
Provided by Operating Activities
(Dollars in thousands)
(Unaudited)

		Six Months Ended
		June 30,
		2006				2005
Free Cash Flow		$	5,066			$	(8,443	)
Capital expenditures			104,781				111,878
Other expenses			(2,864	)			(3,948	)
Non-cash, share-based compensation charges			(2,053	)			(541	)
Change in assets and liabilities, net			2,797				4,180
Net cash flows provided by operating activities		$	107,727			$	103,126

(7) Calculation – Free Cash Flow

(Dollars in thousands)
(Unaudited)

		Three Months Ended
		June 30,
		2006				2005
Adjusted OIBDA		$	114,932			$	105,910
Cash taxes			(56	)			(104	)
Capital expenditures			(57,162	)			(57,089	)
Interest expense, net			(56,890	)			(50,136	)
Free Cash Flow		$	824			$	(1,419	)

		Six Months Ended
		June 30,
		2006				2005
Adjusted OIBDA		$	222,501			$	205,034
Cash taxes			(112	)			(189	)
Capital expenditures			(104,781	)			(111,878	)
Interest expense, net			(112,542	)			(101,410	)
Free Cash Flow		$	5,066			$	(8,443	)

(8) Summary Operating Statistics (Unaudited)

		Actual				Actual				Actual
		June 30,				March 31,				June 30,
		2006				2006				2005
Estimated homes passed			2,813,000				2,811,000				2,800,000
Total revenue generating units (RGUs)(a)			2,478,000				2,469,000				2,327,000
Quarterly net RGU additions			9,000				52,000				29,000
RGU penetration(b)			88.1	%			87.8	%			83.1	%
Total monthly revenue per RGU(c)		$	40.75			$	39.48			$	39.98
Customer relationships(d)			1,459,000				1,479,000				1,489,000
Video
Basic subscribers			1,400,000				1,422,000				1,446,000
Quarterly net basic subscriber (losses) gains			(22,000	)			(1,000	)			(15,000	)
Basic penetration(e)			49.8	%			50.6	%			51.6	%
Digital customers			496,000				497,000				455,000
Quarterly net digital customer additions			(1,000	)			3,000				25,000
Digital penetration(f)			35.4	%			35.0	%			31.5	%
Monthly video revenue per basic subscriber(g)		$	52.65			$	50.90			$	49.52
Data
Data customers			516,000				504,000				426,000
Quarterly net data customer additions			12,000				26,000				19,000
Data penetration(h)			18.3	%			17.9	%			15.2	%
Monthly data revenue per data customer(i)		$	37.79			$	37.40			$	38.35
Phone
Estimated marketable phone homes(j)			1,700,000				1,575,000				—
Phone customers			66,000				46,000				—
Quarterly net phone customer additions			20,000				24,000				—
Total monthly revenue per basic subscriber(k)		$	71.44			$	67.80			$	63.60