Attached files
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| 8-K - GENERAL COMMUNICATION, INC FORM 8-K - GRIZZLY MERGER SUB 1, LLC | gciform8k03072012.htm |
Exhibit 99.1
March 7, 2012
John Lowber, (907) 868-5628; jlowber@gci.com
Bruce Broquet, (907) 868-6660; bbroquet@gci.com
David Morris, (907) 265-5396; dmorris@gci.com
FOR IMMEDIATE RELEASE
GCI REPORTS 2011 FINANCIAL RESULTS
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·
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Consolidated revenue of $679.4 million
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·
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Adjusted EBITDA of $223.6 million
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·
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Net income of $5.8 million or $0.12 per diluted share
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ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its 2011 results with revenues increasing to $679.4 million over revenues of $651.3 million in 2010. Adjusted EBITDA for 2011 was $223.6 million, an increase of $2.1 million over Adjusted EBITDA of $221.5 million for 2010.
For the fourth quarter of 2011, revenues totaled $168.8 million as compared to $165.0 million in the fourth quarter of 2010. Revenues were down $8.9 million sequentially when compared to third quarter 2011 revenues of $177.7 million. Adjusted EBITDA for the fourth quarter of 2011 was $52.3 million, an increase of 3.8 percent over the fourth quarter of 2010 and a decrease, as expected, of 17.2 percent from the seasonal peak third quarter of 2011.
Revenues and EBITDA for the fourth quarter and the year 2011 were unfavorably impacted by the November 29, 2011 FCC order implementing final rules for the calculation of support from the Universal Service Fund (USF) high cost program. The final rules, effective for the year 2012, accelerated the timing of an adjustment to USF accounts receivable which reduced GCI’s reported revenue and EBITDA by $3.5 million in the fourth quarter of 2011. GCI had previously expected the order would affect the company’s results beginning with the first quarter of 2012.
Net income for 2011 totaled $5.8 million or earnings per diluted share of $0.12, a decrease from net income of $9.0 million or earnings per share of $0.17 for 2010.
“GCI’s completion of it’s TERRA Southwest network on budget and nearly two years ahead of schedule was the highlight of 2011,” said GCI President Ron Duncan. “This $88 million project which provides the first terrestrial connectivity for residents of southwest Alaska is an important platform for future growth.”
“Unfortunately 2011 performance was not as strong as we would have liked in our other key growth area of wireless. A nearly six month delay in the completion of our 4G network delayed plans for new products and devices and impeded subscriber growth. GCI has now rolled out its HSPA+ network covering Alaska's major population centers and we have a competitive offering of smartphones and modems capable of utilizing our new network. We will continue to expand the coverage of this network through the end of 2012. “
“Excluding the adverse impact of the FCC Order, 2011 financial results were mostly in line with expectations. Revenues grew by more than four percent and, but for the FCC Order, EBITDAS, at $227 million, would have been at the high end of our revised guidance.”
GCI provided guidance on revenues of $685 million to $700 million and adjusted EBITDA of $225 million to $227 million for the year 2011, excluding any affects from the USF order. GCI’s revenue and EBITDA results for 2011 finished near the low end of the revenue range and near the high end of the EBITDA range, respectively, excluding the impact of the changes to the USF high cost program.
GCI anticipates revenues of $690 million to $720 million and adjusted EBITDA of $230 million to $240 million for the year 2012. Expectations for 2012 have been reduced by more than $13 million as a result of the FCC USF order.
Highlights
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·
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GCI completed construction on TERRA-Southwest (TERRA-SW) and has transitioned the majority of its customers in the TERRA-SW region to the recently completed network. TERRA-SW is GCI’s project to extend terrestrial broadband service to Bristol Bay and the Yukon-Kuskokwim Delta and was completed by the end of 2011, two years ahead of schedule.
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·
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GCI repurchased 5,228,885 shares of its Class A common stock in 2011 at an average price per share of $10.07. GCI is authorized to repurchase $92.9 million of its common equity depending on company performance, market conditions, and liquidity, and subject to board oversight. At the end of 2011, GCI had approximately 42.2 million shares outstanding.
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Managed Broadband revenues for 2011 totaled $63.2 million, an increase of $13.3 million or 26.6 percent over 2010. Fourth quarter 2011 revenues of $17.2 million increased $3.3 million over fourth quarter revenues of $13.9 million in 2010.
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Commercial revenues for 2011 increased $7.6 million to $136.1 million, as compared to revenues of $128.5 million in 2010. Fourth quarter 2011 revenues of $34.5 million increased 3.8 percent over the prior year. Commercial revenues were unfavorably impacted by $0.4 million in revenue adjustments due to changes to the USF high cost program in the fourth quarter of 2011.
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GCI is the second largest wireless provider in Alaska with 139,900 wireless subscribers at the end of 2011, an increase of 1,200 subscribers over the prior year. GCI has rolled out its HSPA+ network covering Alaska's major population centers and an additional nine towns and cities are covered by our HSPA network. We will continue to expand the coverage of this network through the end of 2012.
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GCI had 119,400 consumer and commercial cable modem customers at the end of 2011, an increase of 3,000 customers over 116,400 customers at the end of 2010. Fourth quarter cable modem customers increased by 1,500 over 117,900 customers at the end of the third quarter 2011. Average monthly revenue per cable modem for the fourth quarter of 2011 was $61.37, an increase of 14.8 percent over the $53.47 figure posted for the prior year and 6.9 percent from the $57.43 figure posted for the third quarter of 2011.
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GCI had 138,100 access lines at the end of the fourth quarter of 2011, representing an estimated 36 percent share of the total access line market in Alaska. Access lines for 2011 decreased 4.6 percent from the total at the end of 2010 and decreased 0.8 percent from the third quarter of 2011.
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GCI’s facilities-based access lines totaled 109,800, representing 79.5 percent of its total access lines at the end of the fourth quarter of 2011. Facilities based access lines increased 100 lines over the third quarter of 2011.
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Consumer
Consumer revenues increased 2.8 percent to $352.6 million as compared to $342.9 million in 2010. Data and wireless continue to drive financial results in the consumer business. Fourth quarter 2011 revenues of $86.3 million were steady when compared to the prior year and decreased 3.3 percent sequentially. Changes to the USF high cost program reduced consumer revenues by $3.1 million in fourth quarter of 2011.
Consumer voice revenues of $52.1 million, as expected, were lower as compared to $57.3 million in 2010. The decrease in consumer voice revenues was primarily due to a decrease in USF support rates and a decrease in access lines. Consumer local access lines in service at the end of the 2011 totaled 77,600, a decrease of 7,200 lines from 2010. The decrease in access lines is a result of customers discontinuing wire line service and relying solely on wireless devices. While GCI has consistently grown share in the wire line market, the share growth is no longer sufficient to offset the decreasing overall size of the wire line access market.
Fourth quarter 2011 consumer voice revenues of $11.5 million decreased 15.4 percent from the fourth quarter of 2010 and 12.6 percent sequentially. The decrease in revenues is due to the USF high cost program changes and a decrease in access lines. USF high cost program changes reduced voice revenues by $0.6 million for the fourth quarter of 2011. Total access lines decreased 1,500 lines sequentially.
GCI serves 72,000 consumer access lines on its own facilities, a decrease of 5,400 lines from 2010 and a decrease of 1,200 lines from the third quarter of 2011. More than 92 percent of consumer access lines are provisioned exclusively on GCI facilities.
Consumer video revenues of $118.6 million for 2011 were steady with the prior year. Fourth quarter 2011 video revenues of $29.6 million decreased 2.6 percent from the prior year and increased 1.5 percent sequentially. The decreases for the quarter are largely due to a decrease in video subscribers. Consumer basic video subscribers totaled 125,000 at the end of 2011, a decrease of 5,000 subscribers from 2010 and 1,400 subscribers from the third quarter of 2011.
Consumer data revenues of $72.0 million for 2011 increased 17.3 percent over the prior year. Fourth quarter 2011 data revenues of $19.9 million increased 18.4 percent over the prior year and 10.2 percent sequentially. The increase in consumer data revenues for the year and for the fourth quarter of 2011 is due to an increase in cable modem customers and increasing average monthly usage per cable modem. GCI added 2,600 consumer cable modem customers over the prior year and cable modem customer counts increased by 1,500 on a sequential basis.
Consumer wireless revenues increased to $109.9 million for 2011, an increase of 3.9 percent over 2010. Consumer had a decrease of 300 wireless customers from the end of 2010. Consumer wireless revenues grew by 6.3 percent over 2010, excluding a $2.5 million decrease in revenues from changes to the USF high cost program in the fourth quarter of 2011.
Consumer wireless revenues for the fourth quarter of 2011 decreased 2.1 percent from the fourth quarter of 2010 and 12.3 percent sequentially. The decrease in quarterly revenue is primarily due to the changes to the USF high cost program. Consumer had a decrease of 1,200 wireless customers during the fourth quarter of 2011.
Network Access
Network access revenues decreased 1.7 percent to $105.5 million in 2011 as compared to $107.2 million in 2010. Fourth quarter revenues of $25.7 million were steady with the prior year and decreased $3.7 million or 12.6 percent sequentially. The sequential decrease in quarterly revenues is primarily due to seasonality.
Voice revenues decreased 18.9 percent to $23.6 million from the prior year. Fourth quarter 2011 voice revenues of $5.4 million decreased 17.3 percent from the fourth quarter of the prior year and 12.6 percent sequentially. The continued decrease in wire line voice revenues was expected and is primarily due to wireless and data substitution. The sequential decrease in quarterly revenue is due in part to seasonality. Long distance minutes in 2011 decreased 3.2 percent from the prior year and fourth quarter 2011 minutes were down 2.9 percent from the fourth quarter of 2010 and decreased 11.3 percent on a seasonal basis from the third quarter of 2011.
Data revenues increased 1.6 percent compared to 2010. Fourth quarter 2011 data revenue of $15.3 million increased 1.2 percent over the fourth quarter of the prior year and decreased 10.6 percent sequentially. The increase in data revenues is primarily attributable to the continuing shift to IP-based transport.
Wireless revenues, primarily related to roaming traffic, increased $2.7 million or 16.4 percent to $19.4 million over 2010. On a quarterly basis, wireless roaming revenues continue to increase as compared to the prior year. The decrease in quarterly sequential revenues is primarily due to seasonality.
Commercial
Commercial revenues for 2011 increased $7.6 million, an increase of 5.9 percent, to $136.1 million as compared to $128.5 million in 2010. The increase in revenues for the year is primarily due to increases in special project work. Commercial revenues were unfavorably impacted by $0.4 million in revenue adjustments due to changes to the USF high cost program in fourth quarter of 2011.
Fourth quarter 2011 revenues of $34.5 million increased 3.8 percent over the fourth quarter of the prior year and decreased 3.1 percent on a sequential basis. Special project work drove the increase in revenues over the prior year but revenues were lower on a sequential basis as projects were completed during the fourth quarter.
Voice revenues for 2011 decreased 9.5 percent compared to the prior year. Long distance minutes decreased 3.6 percent from the prior year. Voice revenues for the fourth quarter decreased 10.0 percent compared to the prior year fourth quarter and 6.7 percent sequentially. Changes to the USF high cost program reduced voice revenues by $0.2 million in fourth quarter of 2011. Local access lines at the end of 2011 increased by 1,400 lines over 2010.
Commercial video revenues of $11.6 million increased by 3.8 percent compared to the prior year. Commercial video subscribers totaled 17,600 at the end of the year 2011, an increase of 500 subscribers over the end of the prior year.
Commercial data service revenues include both transmission charges for data circuits and time and materials charges for GCI on-site support of customer operations. Data transport charges of $39.9 million increased by $4.0 million as compared to 2010 and time and material charges for support activities increased by $5.1 million to $46.0 million for 2011 as a result of increased activity primarily in the oil sector. Commercial data service revenues were $86.0 million in 2011, up $9.1 million over 2010.
Commercial wireless revenues totaled $9.8 million for 2011, an increase of 12.4 percent over the prior year. Changes to the USF high cost program reduced wireless revenues by $0.2 million in fourth quarter of 2011. GCI had 15,300 Commercial wireless subscribers at the end of 2011, an increase of 1,500 subscribers over the prior year.
Managed Broadband
Managed broadband revenues totaled $63.2 million in 2011, an increase of 26.6 percent over $50.0 million in 2010. Fourth quarter 2011 revenue of $17.2 million increased 23.4 percent over the fourth quarter of the prior year and was steady with the third quarter of 2011. Managed Broadband segment revenues are expected to increase in 2012 as customers gain access to the newly completed TERRA–SW network.
Regulated Operations
Regulated operations revenues totaled $22.0 million in 2011 as compared to $22.7 million in 2010. Regulated operations revenues for the fourth quarter of 2011 decreased $0.4 million to $5.0 million when compared to the fourth quarter of 2010 and decreased $0.9 million from the third quarter of 2011. The decreases in revenue were primarily attributable to decreases in local access line revenues and decreases in pooled access revenues. Regulated operations had 9,100 local access lines at the end of the fourth quarter of 2011, a decrease of 200 access lines from the third quarter of 2011.
Other Items
SG&A expenses for 2011 totaled $235.5 million, an increase of 2.9 percent as compared to $228.8 million for 2010. The increase is due in part to increases in health care costs and labor and related benefits. As a percentage of revenues, SG&A expenses were steady at 35 percent in 2011 when compared to 2010.
GCI’s 2011 capital expenditures totaled $186.4 million as compared to $100.6 million in 2010. Cash capital expenditures total $177.1 million for 2011 and compare to $96.2 million in 2010. GCI’s total capital expenditures for 2011 include $78.2 million related to the TERRA-SW project. GCI has incurred $87.1 million of project costs to date. The total reimbursable cost for the project is $88.2 million. GCI received $70.3 million in loans and grants against the total reimbursable cost of the project during 2011. GCI expects cash capital expenditures to total approximately $135 million for 2012.
GCI will hold a conference call to discuss the quarter’s results on Thursday, March 8, 2012 beginning at 2 p.m. (Eastern). To access the briefing on March 8, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-324-0798 (International callers should dial 1-212-519-0809) and identify your call as “GCI.” In addition to the conference call, GCI will make available net conferencing. To access the call via net conference, log on to www.gci.com and follow the instructions. A replay of the call will be available for 72-hours by dialing 800-839-5568, access code 7461 (International callers should dial 203-369-3122.)
GCI is the largest telecommunications company in Alaska. GCI’s cable plant, which provides voice, video, and broadband data services, passes 80 percent of Alaska households. GCI operates Alaska’s most extensive terrestrial/subsea fiber optic network which connects not only Anchorage but also Fairbanks and Juneau/Southeast Alaska to the lower 48 states with a diversely routed, protected fiber network. GCI’s satellite network provides communications services to small towns and communities throughout rural Alaska. GCI’s newly constructed statewide mobile wireless network seamlessly links urban and rural Alaska for the first time in the state’s history.
A pioneer in bundled services, GCI is the top provider of voice, data, and video services to Alaska consumers with a 70 percent share of the consumer broadband market. GCI is also the leading provider of communications services to enterprise customers, particularly large enterprise customers with complex data networking needs. More information about GCI can be found at www.gci.com.
The foregoing contains forward-looking statements regarding GCI’s expected results that are based on management’s expectations as well as on a number of assumptions concerning future events. Actual results might differ materially from those projected in the forward looking statements due to uncertainties and other factors, many of which are outside GCI’s control. Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements is contained in GCI’s cautionary statement sections of Form 10-K and 10-Q filed with the Securities and Exchange Commission.
# # #
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GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
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CONSOLIDATED BALANCE SHEETS
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(Unaudited)
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(Amounts in thousands)
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December 31,
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December 31,
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Assets
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2011
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2010
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Current assets:
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Cash and cash equivalents
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$ | 29,387 | 33,070 | |||||
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Receivables
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141,827 | 132,856 | ||||||
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Less allowance for doubtful receivables
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5,796 | 9,189 | ||||||
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Net receivables
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136,031 | 123,667 | ||||||
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Deferred income taxes
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15,555 | 10,145 | ||||||
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Prepaid expenses
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7,899 | 5,950 | ||||||
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Inventories
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7,522 | 5,804 | ||||||
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Other current assets
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3,631 | 3,940 | ||||||
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Total current assets
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200,025 | 182,576 | ||||||
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Property and equipment in service, net of depreciation
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851,705 | 798,278 | ||||||
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Construction in progress
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42,918 | 31,144 | ||||||
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Net property and equipment
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894,623 | 829,422 | ||||||
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Cable certificates
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191,635 | 191,635 | ||||||
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Goodwill
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74,883 | 73,932 | ||||||
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Wireless licenses
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25,967 | 25,967 | ||||||
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Restricted cash
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15,910 | - | ||||||
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Other intangible assets, net of amortization
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15,835 | 17,717 | ||||||
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Deferred loan and senior notes costs, net of amortization
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12,812 | 13,661 | ||||||
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Other assets
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17,214 | 16,850 | ||||||
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Total other assets
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354,256 | 339,762 | ||||||
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Total assets
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$ | 1,448,904 | 1,351,760 | |||||
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(Continued)
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GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
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CONSOLIDATED BALANCE SHEETS
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(Unaudited)
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(Continued)
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(Amounts in thousands)
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December 31,
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December 31,
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Liabilities and Stockholders' Equity
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2011
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2010
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Current liabilities:
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Current maturities of obligations under long-term debt and capital leases
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$ | 8,797 | 7,652 | |||||
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Accounts payable
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41,353 | 35,589 | ||||||
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Deferred revenue
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22,003 | 17,296 | ||||||
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Accrued payroll and payroll related obligations
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22,126 | 22,132 | ||||||
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Accrued interest
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6,680 | 13,456 | ||||||
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Accrued liabilities
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11,423 | 12,557 | ||||||
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Subscriber deposits
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1,250 | 1,271 | ||||||
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Total current liabilities
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113,632 | 109,953 | ||||||
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Long-term debt, net
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858,031 | 779,201 | ||||||
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Obligations under capital leases, excluding current maturities
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78,605 | 84,144 | ||||||
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Obligation under capital lease due to related party
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1,893 | 1,885 | ||||||
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Deferred income taxes
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115,296 | 102,401 | ||||||
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Long-term deferred revenue
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81,822 | 49,175 | ||||||
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Other liabilities
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24,456 | 24,495 | ||||||
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Total liabilities
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1,273,735 | 1,151,254 | ||||||
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Commitments and contingencies
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Stockholders’ equity:
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Common stock (no par):
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Class A. Authorized 100,000 shares; issued 39,296 and 44,213 shares at
December 31, 2011 and 2010, respectively; outstanding 39,043 and
43,958 shares at December 31, 2011 and 2010, respectively
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26,179 | 69,396 | ||||||
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Class B. Authorized 10,000 shares; issued and outstanding 3,171 and
3,178 shares at December 31, 2011 and 2010, respectively; convertible
on a share-per-share basis into Class A common stock
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2,679 | 2,677 | ||||||
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Less cost of 253 and 255 Class A common shares held in
treasury at December 31, 2011 and 2010, respectively
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(2,225 | ) | (2,249 | ) | ||||
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Paid-in capital
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32,795 | 37,075 | ||||||
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Retained earnings
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99,433 | 93,607 | ||||||
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Total General Communication, Inc. stockholders' equity
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158,861 | 200,506 | ||||||
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Non-controlling interest
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16,308 | - | ||||||
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Total stockholders' equity
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175,169 | 200,506 | ||||||
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Total liabilities and stockholders' equity
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$ | 1,448,904 | 1,351,760 | |||||
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GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS
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YEARS ENDED DECEMBER 31, 2011, 2010 AND 2009
(Unaudited)
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(Amounts in thousands, except per share amounts)
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2011
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2010
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2009
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Revenues
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$ | 679,381 | 651,250 | 595,811 | ||||||||
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Cost of goods sold (exclusive of depreciation and amortization shown
separately below)
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227,399 | 207,817 | 193,676 | |||||||||
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Selling, general and administrative expenses
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235,521 | 228,808 | 212,671 | |||||||||
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Depreciation and amortization expense
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125,742 | 126,114 | 123,362 | |||||||||
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Operating income
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90,719 | 88,511 | 66,102 | |||||||||
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Other income (expense):
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Interest expense (including amortization and write-off of deferred loan fees)
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(68,258 | ) | (70,329 | ) | (58,761 | ) | ||||||
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Loss on extinguishment of debt
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(9,111 | ) | - | - | ||||||||
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Interest income
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33 | 261 | 111 | |||||||||
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Other
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(297 | ) | - | - | ||||||||
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Other expense, net
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(77,633 | ) | (70,068 | ) | (58,650 | ) | ||||||
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Income before income tax expense
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13,086 | 18,443 | 7,452 | |||||||||
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Income tax expense
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7,485 | 9,488 | 3,936 | |||||||||
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Net income
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5,601 | 8,955 | 3,516 | |||||||||
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Net loss attributable to the non-controlling interest
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238 | - | - | |||||||||
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Net income attributable to General Communication, Inc.
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$ | 5,839 | 8,955 | 3,516 | ||||||||
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Basic net income attributable to General Communication, Inc.
common stockholders per Class A common share
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$ | 0.13 | 0.17 | 0.07 | ||||||||
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Basic net income attributable to General Communication, Inc.
common stockholders per Class B common share
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$ | 0.13 | 0.17 | 0.07 | ||||||||
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Diluted net income attributable to General Communication, Inc.
common stockholders per Class A common share
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$ | 0.12 | 0.17 | 0.06 | ||||||||
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Diluted net income attributable to General Communication, Inc.
common stockholders per Class B common share
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$ | 0.12 | 0.17 | 0.06 | ||||||||
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Common shares used to calculate Class A basic EPS
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42,175 | 50,076 | 50,159 | |||||||||
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Common shares used to calculate Class A diluted EPS
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45,889 | 53,426 | 53,848 | |||||||||
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GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
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SUPPLEMENTAL SCHEDULES
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(Unaudited)
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(Amounts in thousands)
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Fourth Quarter 2011
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Fourth Quarter 2010
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Network
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Managed
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Regulated
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Network
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Managed
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Regulated
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Consumer
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Access
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Commercial
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Broadband
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Operations
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Totals
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Consumer
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Access
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Commercial
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Broadband
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Operations
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Totals
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Revenues
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Voice
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$ | 11,511 | 5,429 | 6,662 | - | 5,044 | 28,646 | $ | 13,606 | 6,561 | 7,404 | - | 5,443 | 33,014 | ||||||||||||||||||||||||||||||||||
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Video
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29,595 | - | 2,999 | - | - | 32,594 | 30,379 | - | 3,269 | - | - | 33,648 | ||||||||||||||||||||||||||||||||||||
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Data
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19,931 | 15,321 | 22,308 | 17,207 | - | 74,767 | 16,833 | 15,134 | 20,279 | 13,942 | - | 66,188 | ||||||||||||||||||||||||||||||||||||
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Wireless
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25,299 | 4,991 | 2,515 | - | - | 32,805 | 25,850 | 4,033 | 2,263 | - | - | 32,146 | ||||||||||||||||||||||||||||||||||||
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Total
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86,336 | 25,741 | 34,484 | 17,207 | 5,044 | 168,812 | 86,668 | 25,728 | 33,215 | 13,942 | 5,443 | 164,996 | ||||||||||||||||||||||||||||||||||||
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Cost of goods sold
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27,938 | 5,972 | 16,140 | 3,987 | 1,628 | 55,665 | 27,282 | 6,576 | 15,686 | 4,089 | 1,037 | 54,670 | ||||||||||||||||||||||||||||||||||||
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Contribution
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58,398 | 19,769 | 18,344 | 13,220 | 3,416 | 113,147 | 59,386 | 19,152 | 17,529 | 9,853 | 4,406 | 110,326 | ||||||||||||||||||||||||||||||||||||
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Less SG&A
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36,550 | 8,189 | 10,959 | 5,234 | 3,546 | 64,478 | 34,271 | 9,649 | 10,559 | 4,683 | 3,153 | 62,315 | ||||||||||||||||||||||||||||||||||||
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Less Other expense
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- | - | - | 205 | - | 205 | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
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EBITDA
|
21,848 | 11,580 | 7,385 | 7,781 | (130 | ) | 48,464 | 25,115 | 9,503 | 6,970 | 5,170 | 1,253 | 48,011 | |||||||||||||||||||||||||||||||||||
|
Add share-based
compensation
|
1,769 | 646 | 630 | 335 | 16 | 3,396 | 1,032 | 479 | 332 | 191 | 3 | 2,037 | ||||||||||||||||||||||||||||||||||||
|
Add accretion
|
93 | 30 | 27 | 13 | - | 163 | 149 | 71 | 43 | 26 | - | 289 | ||||||||||||||||||||||||||||||||||||
|
Add loss from
noncontrolling interest
|
- | - | - | 238 | - | 238 | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
|
Adjusted EBITDA
|
$ | 23,710 | 12,256 | 8,042 | 8,367 | (114 | ) | 52,261 | $ | 26,296 | 10,053 | 7,345 | 5,387 | 1,256 | 50,337 | |||||||||||||||||||||||||||||||||
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
SUPPLEMENTAL SCHEDULES
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
(Unaudited)
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
(Amounts in thousands)
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Fourth Quarter 2011
|
Third Quarter 2011
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Network
|
Managed
|
Regulated
|
Network
|
Managed
|
Regulated
|
|||||||||||||||||||||||||||||||||||||||||||
|
Consumer
|
Access
|
Commercial
|
Broadband
|
Operations
|
Totals
|
Consumer
|
Access
|
Commercial
|
Broadband
|
Operations
|
Totals
|
|||||||||||||||||||||||||||||||||||||
|
Revenues
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Voice
|
$ | 11,511 | 5,429 | 6,662 | - | 5,044 | 28,646 | $ | 13,164 | 6,213 | 7,137 | - | 5,990 | 32,504 | ||||||||||||||||||||||||||||||||||
|
Video
|
29,595 | - | 2,999 | - | - | 32,594 | 29,155 | - | 2,830 | - | - | 31,985 | ||||||||||||||||||||||||||||||||||||
|
Data
|
19,931 | 15,321 | 22,308 | 17,207 | - | 74,767 | 18,088 | 17,140 | 23,040 | 17,407 | - | 75,675 | ||||||||||||||||||||||||||||||||||||
|
Wireless
|
25,299 | 4,991 | 2,515 | - | - | 32,805 | 28,860 | 6,114 | 2,565 | - | - | 37,539 | ||||||||||||||||||||||||||||||||||||
|
Total
|
86,336 | 25,741 | 34,484 | 17,207 | 5,044 | 168,812 | 89,267 | 29,467 | 35,572 | 17,407 | 5,990 | 177,703 | ||||||||||||||||||||||||||||||||||||
|
Cost of goods sold
|
27,938 | 5,972 | 16,140 | 3,987 | 1,628 | 55,665 | 27,436 | 9,531 | 17,232 | 4,540 | 1,925 | 60,664 | ||||||||||||||||||||||||||||||||||||
|
Contribution
|
58,398 | 19,769 | 18,344 | 13,220 | 3,416 | 113,147 | 61,831 | 19,936 | 18,340 | 12,867 | 4,065 | 117,039 | ||||||||||||||||||||||||||||||||||||
|
Less SG&A
|
36,550 | 8,189 | 10,959 | 5,234 | 3,546 | 64,478 | 31,737 | 6,300 | 9,358 | 4,031 | 3,027 | 54,453 | ||||||||||||||||||||||||||||||||||||
|
Less Other expense
|
- | - | - | 205 | - | 205 | - | - | - | 59 | - | 59 | ||||||||||||||||||||||||||||||||||||
|
EBITDA
|
21,848 | 11,580 | 7,385 | 7,781 | (130 | ) | 48,464 | 30,094 | 13,636 | 8,982 | 8,777 | 1,038 | 62,527 | |||||||||||||||||||||||||||||||||||
|
Add share-based
compensation
|
1,769 | 646 | 630 | 335 | 16 | 3,396 | 173 | 56 | 104 | 51 | - | 384 | ||||||||||||||||||||||||||||||||||||
|
Add accretion
|
93 | 30 | 27 | 13 | - | 163 | 106 | 37 | 31 | 16 | - | 190 | ||||||||||||||||||||||||||||||||||||
|
Add loss from
noncontrolling interest
|
- | - | - | 238 | - | 238 | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
|
Adjusted EBITDA
|
$ | 23,710 | 12,256 | 8,042 | 8,367 | (114 | ) | 52,261 | $ | 30,373 | 13,729 | 9,117 | 8,844 | 1,038 | 63,101 | |||||||||||||||||||||||||||||||||
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
SUPPLEMENTAL SCHEDULES
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
(Unaudited)
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
(Amounts in thousands)
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Twelve Months Ended December 31, 2011
|
Twelve Months Ended December 31, 2010
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Network
|
Managed
|
Regulated
|
Network
|
Managed
|
Regulated
|
|||||||||||||||||||||||||||||||||||||||||||
|
Consumer
|
Access
|
Commercial
|
Broadband
|
Operations
|
Totals
|
Consumer
|
Access
|
Commercial
|
Broadband
|
Operations
|
Totals
|
|||||||||||||||||||||||||||||||||||||
|
Revenues
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
Voice
|
$ | 52,052 | 23,553 | 28,712 | - | 22,002 | 126,319 | $ | 57,317 | 29,032 | 31,720 | - | 22,705 | 140,774 | ||||||||||||||||||||||||||||||||||
|
Video
|
118,635 | - | 11,605 | - | - | 130,240 | 118,475 | - | 11,178 | - | - | 129,653 | ||||||||||||||||||||||||||||||||||||
|
Data
|
71,977 | 62,456 | 85,961 | 63,248 | - | 283,642 | 61,364 | 61,494 | 76,823 | 49,962 | - | 249,643 | ||||||||||||||||||||||||||||||||||||
|
Wireless
|
109,910 | 19,447 | 9,823 | - | - | 139,180 | 105,742 | 16,701 | 8,737 | - | - | 131,180 | ||||||||||||||||||||||||||||||||||||
|
Total
|
352,574 | 105,456 | 136,101 | 63,248 | 22,002 | 679,381 | 342,898 | 107,227 | 128,458 | 49,962 | 22,705 | 651,250 | ||||||||||||||||||||||||||||||||||||
|
Cost of goods sold
|
110,693 | 28,744 | 65,170 | 17,021 | 5,771 | 227,399 | 104,481 | 25,030 | 59,885 | 14,012 | 4,409 | 207,817 | ||||||||||||||||||||||||||||||||||||
|
Contribution
|
241,881 | 76,712 | 70,931 | 46,227 | 16,231 | 451,982 | 238,417 | 82,197 | 68,573 | 35,950 | 18,296 | 443,433 | ||||||||||||||||||||||||||||||||||||
|
Less SG&A
|
134,951 | 27,837 | 41,085 | 18,246 | 13,402 | 235,521 | 127,130 | 33,566 | 38,838 | 17,338 | 11,936 | 228,808 | ||||||||||||||||||||||||||||||||||||
|
Less Other expense
|
- | - | - | 297 | - | 297 | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
|
EBITDA
|
106,930 | 48,875 | 29,846 | 27,684 | 2,829 | 216,164 | 111,287 | 48,631 | 29,735 | 18,612 | 6,360 | 214,625 | ||||||||||||||||||||||||||||||||||||
|
Add share-based
compensation
|
3,457 | 1,214 | 1,276 | 657 | 16 | 6,620 | 3,361 | 1,598 | 1,117 | 651 | 6 | 6,733 | ||||||||||||||||||||||||||||||||||||
|
Add accretion
|
347 | 120 | 100 | 52 | - | 619 | 149 | 71 | 43 | 26 | - | 289 | ||||||||||||||||||||||||||||||||||||
|
Add loss from
noncontrolling interest
|
- | - | - | 238 | - | 238 | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||
|
Add non-cash
contribution adjustment
|
- | - | - | - | - | - | (81 | ) | (41 | ) | (24 | ) | (14 | ) | - | (160 | ) | |||||||||||||||||||||||||||||||
|
Adjusted EBITDA
|
$ | 110,734 | 50,209 | 31,222 | 28,631 | 2,845 | 223,641 | $ | 114,716 | 50,259 | 30,871 | 19,275 | 6,366 | 221,487 | ||||||||||||||||||||||||||||||||||
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
|
||||||||||||||||||||||||||||
|
KEY PERFORMANCE INDICATORS
|
||||||||||||||||||||||||||||
|
(Unaudited)
|
||||||||||||||||||||||||||||
|
December 31, 2011
|
December 31, 2011
|
|||||||||||||||||||||||||||
|
as Compared to
|
as Compared to
|
|||||||||||||||||||||||||||
|
December 31,
|
December 31,
|
September 30,
|
December 31,
|
September 30,
|
December 31,
|
September 30,
|
||||||||||||||||||||||
|
2011
|
2010
|
2011
|
2010
|
2011
|
2010
|
2011
|
||||||||||||||||||||||
|
Consumer
|
||||||||||||||||||||||||||||
|
Voice
|
||||||||||||||||||||||||||||
|
Long-distance subscribers
|
79,500 | 88,200 | 81,700 | (8,700 | ) | (2,200 | ) | -9.9 | % | -2.7 | % | |||||||||||||||||
|
Total local access lines in service
|
77,600 | 84,800 | 79,100 | (7,200 | ) | (1,500 | ) | -8.5 | % | -1.9 | % | |||||||||||||||||
|
Local access lines in service on GCI facilities
|
72,000 | 77,400 | 73,200 | (5,400 | ) | (1,200 | ) | -7.0 | % | -1.6 | % | |||||||||||||||||
|
Video
|
||||||||||||||||||||||||||||
|
Basic subscribers
|
125,000 | 130,000 | 126,400 | (5,000 | ) | (1,400 | ) | -3.8 | % | -1.1 | % | |||||||||||||||||
|
Digital programming tier subscribers
|
75,600 | 81,800 | 76,700 | (6,200 | ) | (1,100 | ) | -7.6 | % | -1.4 | % | |||||||||||||||||
|
HD/DVR converter boxes
|
89,400 | 88,100 | 87,400 | 1,300 | 2,000 | 1.5 | % | 2.3 | % | |||||||||||||||||||
|
Homes passed
|
242,100 | 238,500 | 239,800 | 3,600 | 2,300 | 1.5 | % | 1.0 | % | |||||||||||||||||||
|
Data
|
||||||||||||||||||||||||||||
|
Cable modem subscribers
|
108,300 | 105,700 | 106,800 | 2,600 | 1,500 | 2.5 | % | 1.4 | % | |||||||||||||||||||
|
Wireless
|
||||||||||||||||||||||||||||
|
Wireless lines in service
|
124,600 | 124,900 | 125,800 | (300 | ) | (1,200 | ) | -0.2 | % | -1.0 | % | |||||||||||||||||
|
Network Access Services
|
||||||||||||||||||||||||||||
|
Data:
|
||||||||||||||||||||||||||||
|
Total ISP access lines in service
|
1,700 | 1,700 | 1,600 | - | 100 | 0.0 | % | 6.3 | % | |||||||||||||||||||
|
Total ISP access lines in service on GCI facilities
|
1,400 | 1,300 | 1,400 | 100 | - | 7.7 | % | 0.0 | % | |||||||||||||||||||
|
Commercial
|
||||||||||||||||||||||||||||
|
Voice:
|
||||||||||||||||||||||||||||
|
Long-distance subscribers
|
8,300 | 9,100 | 8,600 | (800 | ) | (300 | ) | -8.8 | % | -3.5 | % | |||||||||||||||||
|
Total local access lines in service
|
49,700 | 48,300 | 49,200 | 1,400 | 500 | 2.9 | % | 1.0 | % | |||||||||||||||||||
|
Local access lines in service on GCI facilities
|
27,300 | 21,200 | 25,800 | 6,100 | 1,500 | 28.8 | % | 5.8 | % | |||||||||||||||||||
|
Video
|
||||||||||||||||||||||||||||
|
Hotels and mini-headend
subscribers
|
15,700 | 15,300 | 18,000 | 400 | (2,300 | ) | 2.6 | % | -12.8 | % | ||||||||||||||||||
|
Basic subscribers
|
1,900 | 1,800 | 2,000 | 100 | (100 | ) | 5.6 | % | -5.0 | % | ||||||||||||||||||
|
Total basic subscribers
|
17,600 | 17,100 | 20,000 | 500 | (2,400 | ) | 2.9 | % | -12.0 | % | ||||||||||||||||||
|
Data
|
||||||||||||||||||||||||||||
|
Cable modem subscribers
|
11,100 | 10,700 | 11,100 | 400 | - | 3.7 | % | 0.0 | % | |||||||||||||||||||
|
Wireless
|
||||||||||||||||||||||||||||
|
Wireless lines in service
|
15,300 | 13,800 | 14,900 | 1,500 | 400 | 10.9 | % | 2.7 | % | |||||||||||||||||||
|
Regulated Operations
|
||||||||||||||||||||||||||||
|
Voice:
|
||||||||||||||||||||||||||||
|
Total local access lines in service
|
9,100 | 10,000 | 9,300 | (900 | ) | (200 | ) | -9.0 | % | -2.2 | % | |||||||||||||||||
|
December 31, 2011
|
December 31, 2011
|
|||||||||||||||||||||||||||
|
Three Months Ended
|
as Compared to
|
as Compared to
|
||||||||||||||||||||||||||
|
December 31,
|
December 31,
|
September 30,
|
December 31,
|
September 30,
|
December 31,
|
September 30,
|
||||||||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | 2011 | 2010 | 2011 | ||||||||||||||||||||||
|
Consumer
|
||||||||||||||||||||||||||||
|
Voice
|
||||||||||||||||||||||||||||
|
Long-distance minutes carried (in millions)
|
24.7 | 26.2 | 22.3 | (1.5 | ) | 2.4 | -5.7 | % | 10.8 | % | ||||||||||||||||||
|
Video
|
||||||||||||||||||||||||||||
|
Average monthly gross revenue per subscriber
|
$ | 78.51 | $ | 77.77 | $ | 76.85 | $ | 0.74 | $ | 1.66 | 1.0 | % | 2.2 | % | ||||||||||||||
|
Wireless
|
||||||||||||||||||||||||||||
|
Average monthly gross revenue per subscriber
|
$ | 61.40 | $ | 64.88 | $ | 72.60 | $ | (3.48 | ) | $ | (11.20 | ) | -5.4 | % | -15.4 | % | ||||||||||||
|
Network Access Services
|
||||||||||||||||||||||||||||
|
Voice
|
||||||||||||||||||||||||||||
|
Long-distance minutes carried (in millions)
|
179.6 | 185.0 | 202.5 | (5.4 | ) | (22.9 | ) | -2.9 | % | -11.3 | % | |||||||||||||||||
|
Commercial
|
||||||||||||||||||||||||||||
|
Voice:
|
||||||||||||||||||||||||||||
|
Long-distance minutes carried (in millions)
|
27.0 | 27.3 | 28.4 | (0.3 | ) | (1.4 | ) | -1.1 | % | -4.9 | % | |||||||||||||||||
|
Total
|
||||||||||||||||||||||||||||
|
Long-distance minutes carried (in millions)
|
231.3 | 238.5 | 253.2 | (7.2 | ) | (21.9 | ) | -3.0 | % | -8.6 | % | |||||||||||||||||
|
December 31, 2011
|
December 31, 2011
|
|||||||||||||||
|
Twelve Months Ended
|
as Compared to
|
as Compared to
|
||||||||||||||
|
December 31,
|
December 31,
|
December 31,
|
December 31,
|
|||||||||||||
|
2011
|
2010
|
2010
|
2010
|
|||||||||||||
|
Consumer
|
||||||||||||||||
|
Voice
|
||||||||||||||||
|
Long-distance minutes carried (in millions)
|
94.7 | 106.9 | (12.2) | -11.4% | ||||||||||||
|
Network Access Services
|
||||||||||||||||
|
Voice
|
||||||||||||||||
|
Long-distance minutes carried (in millions)
|
760.5 | 785.4 | (24.9) | -3.2% | ||||||||||||
|
Commercial
|
||||||||||||||||
|
Voice:
|
||||||||||||||||
|
Long-distance minutes carried (in millions)
|
111.8 | 116.0 | (4.2) | -3.6% | ||||||||||||
|
Total
|
||||||||||||||||
|
Long-distance minutes carried (in millions)
|
967.0 | 1,008.3 | (41.3) | -4.1% | ||||||||||||
|
General Communication, Inc.
|
||||||||||||
|
Non-GAAP Financial Reconciliation Schedule
|
||||||||||||
|
(Unaudited, Amounts in Millions)
|
||||||||||||
|
Three Months Ended
|
||||||||||||
|
December 31,
|
December 31,
|
September 30,
|
||||||||||
|
2011
|
2010
|
2011
|
||||||||||
|
Net income (loss)
|
$ | (1.1 | ) | (2.2 | ) | 7.2 | ||||||
|
Income tax expense (benefit)
|
(0.0 | ) | (0.8 | ) | 8.0 | |||||||
|
Income (loss) before income tax expense (benefit)
|
(1.1 | ) | (3.0 | ) | 15.2 | |||||||
|
Other expense:
|
||||||||||||
|
Interest expense (including amortization and write-off of deferred loan fees)
|
16.9 | 17.1 | 16.7 | |||||||||
|
Other
|
0.2 | - | - | |||||||||
|
Other expense, net
|
17.1 | 17.1 | 16.7 | |||||||||
|
Operating income
|
16.0 | 14.1 | 31.9 | |||||||||
|
Depreciation and amortization expense
|
32.7 | 33.9 | 30.7 | |||||||||
|
Equity investment
|
(0.2 | ) | - | - | ||||||||
|
EBITDA (Note 2)
|
48.5 | 48.0 | 62.6 | |||||||||
|
Share-based compensation
|
3.4 | 2.0 | 0.4 | |||||||||
|
Accretion
|
0.2 | 0.3 | 0.1 | |||||||||
|
Non-controlling interest
|
0.2 | - | - | |||||||||
|
Adjusted EBITDA (Note 1)
|
$ | 52.3 | 50.3 | 63.1 | ||||||||
|
General Communication, Inc.
|
|||||
|
Non-GAAP Financial Reconciliation Schedule
|
|||||
|
(Unaudited, Amounts in Millions)
|
|||||
| Year Ended | |||||
| December 31, |
|
December 31,
|
|||
|
2011
|
2010
|
||||
|
Net income
|
$
|
5.6
|
9.0
|
||
|
Income tax expense
|
7.5
|
9.4
|
|||
|
Income before income tax expense
|
13.1
|
18.4
|
|||
|
Other expense:
|
|||||
|
Interest expense (including amortization and write-off of deferred loan fees)
|
68.3
|
70.3
|
|||
|
Interest income
|
-
|
(0.2)
|
|||
|
Loss on extinguishment of debt
|
9.1
|
-
|
|||
|
Other
|
0.2
|
-
|
|||
|
Other expense, net
|
77.6
|
70.1
|
|||
|
Operating income
|
90.7
|
88.5
|
|||
|
Depreciation and amortization expense
|
125.7
|
126.1
|
|||
|
Equity investment
|
(0.2)
|
-
|
|||
|
EBITDA (Note 2)
|
216.2
|
214.6
|
|||
|
Share-based compensation
|
6.6
|
6.7
|
|||
|
Accretion
|
0.6
|
0.3
|
|||
|
Non-controlling interest
|
0.2
|
-
|
|||
|
Non-cash contribution adjustment
|
-
|
(0.1)
|
|||
|
Adjusted EBITDA (Note 1)
|
$
|
223.6
|
221.5
|
||
|
Notes:
|
|||||
|
(1) EBITDA (as defined in Note 2 below) before deducting share-based compensation,
|
|||||
|
accretion expense, loss attributable to non-controlling interest and non-cash
|
|||||
|
contribution adjustment.
|
|||||
|
(2) Earnings Before Interest, Taxes, Depreciation and Amortization is the sum of Net
|
|||||
|
Income, Interest Expense (including Amortization of Deferred Loan Fees), Interest
|
|||||
|
Income, Income Tax Expense, and Depreciation and Amortization Expense.
|
|||||
|
EBITDA is not presented as an alternative measure of net income, operating
|
|||||
|
income or cash flow from operations, as determined in accordance with accounting
|
|||||
|
principles generally accepted in the United States of America. GCI's management
|
|||||
|
uses EBITDA to evaluate the operating performance of its business, and as a
|
|||||
|
measure of performance for incentive compensation purposes. GCI believes
|
|||||
|
EBITDA is a measure used as an analytical indicator of income generated to service
|
|||||
|
debt and fund capital expenditures. In addition, multiples of current or projected
|
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|
EBITDA are used to estimate current or prospective enterprise value. EBITDA does
|
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|
not give effect to cash used for debt service requirements, and thus does not reflect
|
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|
funds available for investment or other discretionary uses. EBITDA as presented
|
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|
herein may not be comparable to similarly titled measures reported by other
|
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|
companies.
|
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