GCI, LLC - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - GCI INC FORM 8K - GCI, LLC	incform8k08012012.htm

Exhibit 99.1

August 1, 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 SECOND QUARTER 2012 FINANCIAL RESULTS

·	Consolidated revenue of $176.1 million

·	Adjusted EBITDA of $59.4 million

·	Net income of $4.0 million or $0.09 per diluted share

ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its second quarter 2012 results with revenues increasing to $176.1 million over revenues of $168.1 million in the second quarter of 2011. Adjusted EBITDA increased 8.2 percent or $4.5 million over the second quarter of 2011 EBITDA of $54.9 million.

Revenues in the second quarter of 2012 were favorably impacted by the recognition of $1.6 million in revenues for services provided to a managed broadband customer for their fiscal year ended June 30, 2009, following a successful regulatory appeal. The EBITDA impact of $1.6 million in additional revenues was offset entirely by $1.8 million of costs related to the previously announced transaction to form The Alaska Wireless Network, LLC (”AWN”).

GCI’s second quarter 2012 net income totaled $4.0 million or earnings per diluted share of $0.09 and compares to a net loss of $2.0 million or loss per diluted share of $(0.04) for the same period of 2011.

Second quarter of 2012 revenues increased $4.2 million over revenues of $171.9 million in the first quarter of 2012. Adjusted EBITDA increased $4.6 million or 8.4 percent over adjusted EBITDA of $54.8 million in the first quarter of 2012.

“We took a major step forward this quarter by reaching agreement with Alaska Communications to combine our wireless networks,” said Ron Duncan, GCI president. “Once implemented, we look forward to providing GCI customers the best overall wireless service in urban and rural Alaska. Adding Alaska Communications’ substantial mobile radio spectrum portfolio, LTE network, and wireless tower footprint to GCI’s wireless assets will result in a substantially more capable statewide 4G wireless platform.”

GCI previously provided guidance on revenues of $690 million to $720 million and adjusted EBITDA of $230 million to $240 million for the year 2012.

Highlights

GCI entered into an agreement with Alaska Communications Systems Group, Inc. to form The Alaska Wireless Network, LLC (“AWN”) that will hold and operate both companies’ wireless facilities. AWN will provide a robust, statewide network with the spectrum, scale, advanced technology and cost structure necessary to compete with the national carriers. GCI will invest $100 million to gain a majority interest in a wireless network operation that is twice the size of its current one. The AWN transaction is subject to required governmental approvals and other customary conditions.

GCI began selling the iPhone on April 20, 2012 and has sold 9,200 iPhones by the end of the second quarter of 2012. GCI estimates 40 percent of iPhones sales are to new subscribers. The iPhone has been well received by GCI’s customers and the costs associated with the launch have been within expectations.

GCI had 141,000 wireless subscribers at the end of the second quarter of 2012 and is the second largest wireless service provider in Alaska. Wireless subscribers increased by 1,000 over the first quarter of 2012. Average monthly revenue per subscriber was $67.69, a decrease of 1.4 percent from $68.65 for the first quarter of 2012.

·	Managed Broadband revenues for the second quarter of 2012 totaled $21.7 million, an increase of $7.1 million or 48.4 percent over the second quarter of 2011, primarily as a result of the turn-up of GCI’s TERRA-Southwest terrestrial network.

GCI had 123,500 consumer and commercial cable modem customers at the end of the second quarter of 2012, an increase of 1,500 over the 122,000 cable modem customers at the end of the first quarter 2012. Average monthly revenue per cable modem for the second quarter of 2012 was $63.64, an increase of 19.0 percent over $53.46 for the prior year and an increase of 3.5 percent over the $61.48 figure posted for the first quarter of 2012.

Consumer

Consumer revenues were steady with the second quarter of 2011 and increased slightly over the first quarter of 2012. Data revenue growth was offset by decreases in voice, video and wireless.

Consumer voice revenues of $10.5 million decreased $3.1 million when compared to the prior year quarter and $0.8 million compared to the first quarter of 2012 as customers continue to abandon wireline service and shift to wireless. Consumer local access lines in service at the end of the second quarter of 2012 totaled 74,400, a decrease of 7,900 lines from the second quarter of 2011 and 1,700 lines from the first quarter of 2012.

Consumer video revenues of $29.2 million decreased 1.1 percent from the second quarter of 2011 and increased 0.7 percent over the first quarter of 2012. The decrease is primarily due to a decline in basic video subscribers. Consumer basic video subscribers totaled 122,500 at the end of the second quarter of 2012, a decrease of 4,400 subscribers from the second quarter of 2011 and 1,700 subscribers from the first quarter of 2012.

Consumer data revenues of $21.5 million increased 24.7 percent over the second quarter of 2011 and 5.3 percent over the first quarter of 2012. The increase in consumer data revenues is due to an increase in cable modem customers and increasing monthly usage. GCI added 6,300 consumer cable modem customers over the second quarter of 2011 and cable modem customer counts increased by 1,000 on a sequential basis.

Consumer wireless revenues of $27.3 million decreased $0.9 million or 3.1 percent from the second quarter of 2011. The decrease was primarily due to a $2.3 million decline in USF support offset in part by increases in plan fee and handset revenues. Wireless revenues were steady when compared to the first quarter of 2012. Consumer had a decrease of 1,600 wireless customers from the end of the second quarter a year ago and an increase of 300 wireless customers sequentially.

GCI serves 124,800 consumer wireless subscribers of whom approximately 40,000 are Lifeline customers. In compliance with FCC Lifeline program reforms, GCI is required to recertify all Lifeline subscribers, enrolled as of June 1, 2012, by the end of 2012, with current subscribers to be recertified annually thereafter. The ongoing implementation of GCI’s existing qualification standards along with initiation of the FCC recertification process have contributed to a decrease of 3,500 Lifeline subscribers in the second quarter of 2012 as compared to the second quarter of 2011. Lifeline subscribers declined by 1,500 on a sequential basis. Increases in GCI’s postpaid and prepaid subscribers have mostly outgrown Lifeline losses in previous quarters. Lifeline subscriber counts could decline further as a result of the recertification process or future program changes.

Network Access

Network access revenues of $26.0 million increased 3.4 percent compared to the second quarter of 2011 and increased 3.3 percent over the first quarter of 2012.

Voice revenues increased 9.6 percent to $6.0 million over the prior year and increased 7.2 percent over the first quarter of 2012. Data revenues were down 10.7 percent when compared to the second quarter of 2011 and 6.6 percent from the first quarter of 2012. The change in voice and data revenues is primarily attributable to rate adjustments resulting from increased competition.

Wireless revenues, primarily related to roaming traffic, increased by $2.0 million to $6.6 million, an increase of 41.7 percent over the prior year and increased by $1.4 million, or 26.0 percent on a sequential basis.

Commercial

Commercial revenues of $34.5 million were steady with the prior year and the first quarter of 2012.

Commercial data service revenues include both transport charges for data circuits, time and materials charges for GCI on-site support of customer operations and data center revenues. Data transport charges of $11.9 million increased by $0.8 million as compared to the second quarter of 2011, time and material charges for support activities decreased by $0.6 million to $9.8 million and data center revenues increased by $0.2 million for the second quarter of 2012. Commercial data service revenues were $21.9 million in the second quarter of 2012, an increase of $0.4 million over the second quarter of 2011 and were steady with the first quarter of 2012.

GCI is now offering data center services based at its South Anchorage Distribution Center. The 10,000 sf data center is a secure facility separate from GCI’s network monitoring and operations.

Commercial wireless revenues totaled $2.5 million for the second quarter of 2012 and were steady with the prior year and increased $0.2 million sequentially. GCI had 16,200 commercial wireless subscribers at the end of the second quarter of 2012, an increase of 1,600 subscribers over the prior year and 700 subscribers sequentially.

Managed Broadband

Managed broadband revenues totaled $21.7 million in the second quarter of 2012, an increase of $7.1 million or 48.4 percent over the prior year and an increase of $2.7 million or 14.1 percent over the first quarter of 2012. The strong revenue growth is primarily due to the increase in broadband service capacity resulting from the turn up of the TERRA Southwest terrestrial network.

Regulated Operations

Regulated operations revenues totaled $5.4 million in the second quarter of 2012 and were steady with the second quarter of 2011 and the first quarter of 2012. Regulated operations had 8,700 local access lines at the end of the second quarter of 2012, a decrease of 200 access lines from the first quarter of 2012.

Other Items

SG&A expenses for the second quarter of 2012 totaled $60.0 million, an increase of 4.1 percent as compared to $57.7 million for the second quarter of 2011. The increase is due to transaction costs related to AWN and labor and related benefits. As a percentage of revenues, SG&A expenses decreased to 34.1 percent in the second quarter of 2012 as compared to 34.3 percent in the prior year. SG&A expenses for the second quarter decreased $2.9 million from the first quarter of 2012. The decrease is primarily related to lower health care costs, less expense recorded for fiber capacity contributed to the University of Alaska during the second quarter, and declines in other categories of general and administrative expenses offset by costs related to AWN.

GCI’s second quarter 2012 capital expenditures totaled $39.1 million as compared to $45.6 million in the second quarter of 2011 and $26.6 million in the first quarter of 2012. GCI expects capital expenditures to total $150 million for the year 2012, which is an increase of $15 million over previous guidance of approximately $135 million.

GCI’s share repurchase program expired during March of 2012. Due to material non-public information related to the AWN transaction and the launch of the iPhone, GCI was prevented from implementing a new repurchase program for the second quarter of 2012. GCI has authorizations to make up to $93.9 million in repurchases, dependent on leverage, liquidity, company performance, market conditions and subject to continued oversight by GCI’s Board of Directors.

GCI will hold a conference call to discuss the quarter’s results on Thursday, August 2, 2012 beginning at 2 p.m. (Eastern). To access the briefing on August 2, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-790-3403 (International callers should dial 1-415-228-3889) 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 888-562-4207, access code 7461 (International callers should dial 203-369-3178.)

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 TERRA-Southwest fiber/microwave system links 65 communities in the Bristol Bay and Yukon-Kuskokwim Delta to Anchorage bringing terrestrial broadband Internet access to the region for the first time. 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.

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)


(Amounts in thousands)
	June 30,		December 31,
Assets	2012		2011

Current assets:
Cash and cash equivalents	$	22,116		29,387

Receivables		161,840		141,827
Less allowance for doubtful receivables		3,199		5,796
Net receivables		158,641		136,031

Deferred income taxes		15,555		15,555
Prepaid expenses		9,302		7,899
Inventories		16,023		7,522
Other current assets		3,366		3,631
Total current assets		225,003		200,025

Property and equipment in service, net of depreciation		822,859		849,121
Construction in progress		71,668		42,918
Net property and equipment		894,527		892,039

Cable certificates		191,635		191,635
Goodwill		74,883		74,883
Wireless licenses		25,967		25,967
Restricted cash		14,804		15,910
Other intangible assets, net of amortization		16,344		15,835
Deferred loan and senior notes costs, net of amortization		11,917		12,812
Other assets		14,777		17,214
Total other assets		350,327		354,256
Total assets	$	1,469,857		1,446,320

			(Continued)

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Continued)


(Amounts in thousands)
	June 30,			December 31,
Liabilities and Stockholders' Equity	2012			2011

Current liabilities:
Current maturities of obligations under long-term debt and capital leases	$	7,612			8,797
Accounts payable		39,382			41,353
Deferred revenue		25,018			22,003
Accrued payroll and payroll related obligations		21,533			22,126
Accrued interest		6,753			6,680
Accrued liabilities		15,216			11,423
Subscriber deposits		1,346			1,250
Total current liabilities		116,860			113,632

Long-term debt, net		874,505			858,031
Obligations under capital leases, excluding current maturities		75,777			78,605
Obligation under capital lease due to related party, excluding current maturity		1,893			1,893
Deferred income taxes		119,350			114,234
Long-term deferred revenue		86,096			81,822
Other liabilities		24,082			24,456
Total liabilities		1,298,563			1,272,673

Commitments and contingencies
Stockholders’ equity:
Common stock (no par):
Class A. Authorized 100,000 shares; issued 38,843 and 39,296 shares at June 30, 2012, and December 31, 2011, respectively; outstanding 38,650 and 39,043 shares at June 30, 2012, and December 31, 2011, respectively		25,909			26,179

Class B. Authorized 10,000 shares; issued and outstanding 3,171 shares each at June 30, 2012, and December 31, 2011; convertible on a share-per-share basis into Class A common stock		2,678			2,679

Less cost of 193 and 253 Class A shares held in treasury at June 30, 2012, and December 31, 2011, respectively		(1,707	)		(2,225	)

Paid-in capital		25,138			32,795
Retained earnings		103,322			97,911
Total General Communication, Inc. stockholders' equity		155,340			157,339
Non-controlling interest		15,954			16,308
Total stockholders' equity		171,294			173,647
Total liabilities and stockholders' equity	$	1,469,857			1,446,320

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(Amounts in thousands, except per share amounts)	2012			2011			2012			2011

Revenues	$	176,104			168,089			348,011			332,866

Cost of goods sold (exclusive of depreciation and amortization shown separately below)		58,073			57,314			114,933			111,070
Selling, general and administrative expenses		60,048			57,697			123,030			116,590
Depreciation and amortization expense		33,350			30,779			65,730			62,645
Operating income		24,633			22,299			44,318			42,561

Other income (expense):
Interest expense (including amortization of deferred loan fees)		(16,948	)		(17,294	)		(34,103	)		(34,746	)
Loss of extinguishment of debt		-			(9,111	)		-			(9,111	)
Interest income		4			4			6			8
Other		84			(9	)		(47	)		(33	)
Other expense, net		(16,860	)		(26,410	)		(34,144	)		(43,882	)

Income (loss) before income tax expense (benefit)		7,773			(4,111	)		10,174			(1,321	)

Income tax (expense) benefit		(3,968	)		2,067			(5,117	)		(676	)

Net income (loss)		3,805			(2,044	)		5,057			(645	)
Net loss attributable to non-controlling interest		177			-			354			-

Net income (loss) attributable to General Communication, Inc.	$	3,982			(2,044	)		5,411			(645	)

Basic net income (loss) attributable to General Communication, Inc. common stockholders per Class A common share	$	0.10			(0.04	)		0.13			(0.01	)

Basic net income (loss) attributable to General Communication, Inc. common stockholders per Class B common share	$	0.10			(0.04	)		0.13			(0.01	)

Diluted net income (loss) attributable to General Communication, Inc. common stockholders per Class A common share	$	0.09			(0.04	)		0.13			(0.02	)

Diluted net income (loss)attributable to General Communication, Inc. common stockholders per Class B common share	$	0.09			(0.04	)		0.13			(0.02	)

Common shares used to calculate Class A basic EPS		38,516			43,098			38,629			43,536

Common shares used to calculate Class A diluted EPS		42,149			46,276			42,230			46,714

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
(Amounts in thousands)
	Second Quarter 2012														Second Quarter 2011
			Network				Managed			Regulated							Network				Managed		Regulated
	Consumer		Access		Commercial		Broadband			Operations		Totals			Consumer		Access		Commercial		Broadband		Operations		Totals
Revenues
Voice	$	10,483		5,962		6,804		-			5,409		28,658		$	13,625		5,441		7,340		-		5,529		31,935
Video		29,235		-		3,236		-			-		32,471			29,546		-		2,936		-		-		32,482
Data		21,523		13,412		21,917		21,717			-		78,569			17,257		15,023		21,518		14,639		-		68,437
Wireless		27,254		6,643		2,509		-			-		36,406			28,126		4,687		2,422		-		-		35,235
Total		88,495		26,017		34,466		21,717			5,409		176,104			88,554		25,151		34,216		14,639		5,529		168,089

Cost of goods sold		30,587		6,186		15,502		4,268			1,530		58,073			28,011		6,576		16,932		4,580		1,215		57,314

Contribution		57,908		19,831		18,964		17,449			3,879		118,031			60,543		18,575		17,284		10,059		4,314		110,775

Less SG&A		34,514		6,573		10,583		5,774			2,604		60,048			33,288		6,570		10,233		4,513		3,093		57,697
Less Other		-		-		-		(84	)		-		(84	)		-		-		-		9		-		9
EBITDA		23,394		13,258		8,381		11,759			1,275		58,067			27,255		12,005		7,051		5,537		1,221		53,069

Add share-based compensation		440		129		194		94			8		865			894		301		319		156		-		1,670
Add accretion		85		27		24		16			-		152			109		38		31		16		-		194
Add loss from non-controlling interest		-		-		-		177			-		177			-		-		-		-		-		-
Add non-cash contribution		89		28		26		17			-		160			-		-		-		-		-		-
Adjusted EBITDA	$	24,008		13,442		8,625		12,063			1,283		59,421		$	28,258		12,344		7,401		5,709		1,221		54,933

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
(Amounts in thousands)
	Second Quarter 2012														First Quarter 2012
			Network				Managed			Regulated							Network				Managed		Regulated
	Consumer		Access		Commercial		Broadband			Operations		Totals			Consumer		Access		Commercial		Broadband		Operations		Totals
Revenues
Voice	$	10,483		5,962		6,804		-			5,409		28,658		$	11,280		5,564		7,086		-		5,537		29,467
Video		29,235		-		3,236		-			-		32,471			29,022		-		3,120		-		-		32,142
Data		21,523		13,412		21,917		21,717			-		78,569			20,449		14,353		21,837		19,029		-		75,668
Wireless		27,254		6,643		2,509		-			-		36,406			27,061		5,271		2,298		-		-		34,630
Total		88,495		26,017		34,466		21,717			5,409		176,104			87,812		25,188		34,341		19,029		5,537		171,907

Cost of goods sold		30,587		6,186		15,502		4,268			1,530		58,073			28,618		6,023		15,700		4,889		1,630		56,860

Contribution		57,908		19,831		18,964		17,449			3,879		118,031			59,194		19,165		18,641		14,140		3,907		115,047

Less SG&A		34,514		6,573		10,583		5,774			2,604		60,048			35,832		7,208		10,694		6,271		2,977		62,982
Less Other		-		-		-		(84	)		-		(84	)		-		-		-		131		-		131
EBITDA		23,394		13,258		8,381		11,759			1,275		58,067			23,362		11,957		7,947		7,738		930		51,934

Add share-based compensation		440		129		194		94			8		865			884		279		333		229		5		1,730
Add accretion		85		27		24		16			-		152			104		33		31		20		-		188
Add loss from non-controlling interest		-		-		-		177			-		177			-		-		-		177		-		177
Add non-cash contribution		89		28		26		17			-		160			444		141		130		85		-		800
Adjusted EBITDA	$	24,008		13,442		8,625		12,063			1,283		59,421		$	24,794		12,410		8,441		8,249		935		54,829

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
(Amounts in thousands)
	Six Months Ended June 30, 2012												Six Months Ended June 30, 2011
			Network				Managed		Regulated						Network				Managed		Regulated
	Consumer		Access		Commercial		Broadband		Operations		Totals		Consumer		Access		Commercial		Broadband		Operations		Totals
Revenues
Voice	$	21,763		11,526		13,890		-		10,946		58,125	$	27,377		11,911		14,913		-		10,968		65,169
Video		58,257		-		6,356		-		-		64,613		59,885		-		5,776		-		-		65,661
Data		41,972		27,765		43,754		40,746		-		154,237		33,958		29,995		40,613		28,634		-		133,200
Wireless		54,315		11,914		4,807		-		-		71,036		55,751		8,342		4,743		-		-		68,836
Total		176,307		51,205		68,807		40,746		10,946		348,011		176,971		50,248		66,045		28,634		10,968		332,866

Cost of goods sold		59,205		12,209		31,202		9,157		3,160		114,933		55,319		13,241		31,798		8,494		2,218		111,070

Contribution		117,102		38,996		37,605		31,589		7,786		233,078		121,652		37,007		34,247		20,140		8,750		221,796

Less SG&A		70,346		13,781		21,277		12,045		5,581		123,030		66,664		13,348		20,769		8,980		6,829		116,590
Less Other		-		-		-		47		-		47		-		-		-		33		-		33
EBITDA		46,756		25,215		16,328		19,497		2,205		110,001		54,988		23,659		13,478		11,127		1,921		105,173

Add share-based compensation		1,324		408		527		323		13		2,595		1,514		514		542		270		-		2,840
Add accretion		533		169		156		102		-		960		149		51		43		23		-		266
Add loss from non-controlling interest		-		-		-		354		-		354		-		-		-		-		-		-
Add non-cash contribution		189		60		55		36		-		340		-		-		-		-		-		-
Adjusted EBITDA	$	48,802		25,852		17,066		20,312		2,218		114,250	$	56,651		24,224		14,063		11,420		1,921		108,279

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
KEY PERFORMANCE INDICATORS
(Unaudited)

							June 30, 2012						June 30, 2012
							as compared to						as compared to
	June 30,		June 30,		March 31,		June 30,			March 31,			June 30,			March 31,
	2012		2011		2012		2011			2012			2011			2012
Consumer
Voice
Total local access lines in service		74,400		82,300		76,100		(7,900	)		(1,700	)		-9.6	%		-2.2	%
Local access lines in service on GCI facilities		69,300		75,900		70,700		(6,600	)		(1,400	)		-8.7	%		-2.0	%

Video
Basic subscribers		122,500		126,900		124,200		(4,400	)		(1,700	)		-3.5	%		-1.4	%
Digital programming tier subscribers		72,200		77,400		74,600		(5,200	)		(2,400	)		-6.7	%		-3.2	%
HD/DVR converter boxes		88,400		87,700		90,300		700			(1,900	)		0.8	%		-2.1	%
Homes passed		242,400		239,000		242,200		3,400			200			1.4	%		0.1	%

Data
Cable modem subscribers		111,700		105,400		110,700		6,300			1,000			6.0	%		0.9	%

Wireless
Wireless lines in service		124,800		126,400		124,500		(1,600	)		300			-1.3	%		0.2	%

Commercial
Voice
Total local access lines in service		51,800		50,800		51,900		1,000			(100	)		2.0	%		-0.2	%
Local access lines in service on GCI facilities		30,200		27,000		29,900		3,200			300			11.9	%		1.0	%

Video
Hotels and mini-headend subscribers		19,300		18,300		16,100		1,000			3,200			5.5	%		19.9	%
Basic subscribers		1,900		2,000		1,900		(100	)		-			-5.0	%		0.0	%
Total basic subscribers		21,200		20,300		18,000		900			3,200			4.4	%		17.8	%

Data
Cable modem subscribers		11,800		11,000		11,300		800			500			7.3	%		4.4	%

Wireless
Wireless lines in service		16,200		14,600		15,500		1,600			700			11.0	%		4.5	%

Regulated Operations
Voice:
Total local access lines in service		8,700		9,400		8,900		(700	)		(200	)		-7.4	%		-2.2	%

							June 30, 2012						June 30, 2012
	Three Months Ended						as Compared to						as Compared to
	June 30,		June 30,		March 31,		June 30,			March 31,			June 30,			March 31,
	2012		2011		2012		2011			2012			2011			2012
Consumer
Video
Average monthly revenue per subscriber	$	78.89	$	76.47	$	77.72	$	2.42		$	1.17			3.2	%		1.5	%

Wireless
Average monthly revenue per subscriber	$	67.69	$	70.52	$	68.65	$	(2.83	)	$	(0.96	)		-4.0	%		-1.4	%

Total
Voice
Long-distance minutes carried (in millions)		241.3		238.7		238.3		2.6			3.0			1.1	%		1.3	%

Data
Average monthly revenue per cable modem subscriber	$	63.64	$	53.46	$	61.48	$	10.18		$	2.16			19.0	%		3.5	%

General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)


	Three Months Ended
	June 30,		June 30,			March 31,
	2012		2011			2012
Net income (loss)	$	3.8		(2.0	)		1.3
Income tax expense (benefit)		4.0		(2.1	)		1.1
Income (loss) before income tax expense (benefit)		7.8		(4.1	)		2.4

Other expense:
Interest expense (including amortization of deferred loan fees)		16.9		17.3			17.2
Loss on extingushment of debt		-		9.1			-
Other		-		-			0.1
Other expense, net		16.9		26.4			17.3

Operating income		24.7		22.3			19.7
Depreciation and amortization expense		33.4		30.8			32.3
Other		-		-			(0.1	)

EBITDA (Note 2)		58.1		53.1			51.9
Share-based compensation		0.9		1.7			1.7
Accretion		0.1		0.1			0.2
Non-controlling interest		0.2		-			0.2
Non-cash contribution adjustment		0.1		-			0.8
Adjusted EBITDA (Note 1)	$	59.4		54.9			54.8

General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)


	Six Months Ended
	June 30,		June 30,
	2012		2011
Net income (loss)	$	5.1		(0.6	)
Income tax expense (benefit)		5.1		(0.7	)
Income (loss) before income tax expense (benefit)		10.2		(1.3	)

Other expense:
Interest expense (including amortization of deferred loan fees)		34.1		34.7
Loss on extingushment of debt		-		9.1
Other		-		0.1
Other expense, net		34.1		43.9

Operating income		44.3		42.6
Depreciation and amortization expense		65.7		62.6
Other		-		-

EBITDA (Note 2)		110.0		105.2
Share-based compensation		2.6		2.8
Accretion		0.3		0.3
Non-controlling interest		0.4		-
Non-cash contribution adjustment		1.0		-
Adjusted EBITDA (Note 1)	$	114.3		108.3

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 (Loss), Interest Expense (including Amortization of Deferred Loan Fees), Interest

Income, Income Tax Expense (Benefit), and Depreciation and Amortization Expense.

EBITDA is not presented as an alternative measure of net income (loss), 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

EBITDA are used to estimate current or prospective enterprise value. EBITDA does

not give effect to cash used for debt service requirements, and thus does not reflect

funds available for investment or other discretionary uses. EBITDA as presented

herein may not be comparable to similarly titled measures reported by other

companies.

GCI, LLC - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - August 2, 2012

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