You are on page 1of 7

CHARTER COMMUNICATIONS, INC.

AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND OPERATING DATA
(dollars in millions, except per share data)
Three Months Ended March 31,
2016

2015

% Change

REVENUES:
Video

1,129

3.7 %

Internet

804

717

12.1 %

Voice

135

134

0.5 %

2,109

1,980

6.5 %

202

182

11.3 %

$

Residential revenue
Small and medium business
Enterprise

1,170

$

99

87

13.4 %

301

269

12.0 %

Advertising sales

72

66

8.8 %

Other

48

47

2.7 %

2,530

2,362

7.1 %

Programming

703

666

5.5 %

Franchises, regulatory and connectivity

112

107

4.5 %

Costs to service customers

421

423

(0.4)%

Marketing

162

151

7.2 %

Commercial revenue

Total Revenues
COSTS AND EXPENSES:

Transition costs

21

21

0.6 %

228

194

17.6 %

1,647

1,562

5.4 %

Adjusted EBITDA

883

800

10.4 %

Adjusted EBITDA margin

34.9%

33.9%

Depreciation and amortization

539

514

Stock compensation expense

24

19

Other operating expenses, net

18

18

302

249

(454)

(289)

(5)

(6)

Other
Total operating costs and expenses (exclusive of items shown separately below)

Income from operations
OTHER EXPENSES:
Interest expense, net
Loss on derivative instruments, net
Other expense, net

(3)

Loss before income taxes
Income tax expense
Net loss

(462)

(295)

(160)

(46)

(28)

(35)

$

(188)

$

(81)

LOSS PER COMMON SHARE, BASIC AND DILUTED

$

(1.68)

$

(0.73)

Weighted average common shares outstanding, basic and diluted

112,311,539

111,655,617

Adjusted EBITDA is a non-GAAP term. See page 6 of this addendum for the reconciliation of adjusted EBITDA to net loss as defined by GAAP.
All percentages are calculated using whole numbers. Minor differences may exist due to rounding.

Addendum to Charter Communications, Inc. First Quarter 2016 Earnings Release
Page 1 of 7

313 22. net Franchises Customer relationships.124 1.264 INVESTMENT IN CABLE PROPERTIES: Property.723 1.618 76 SHAREHOLDERS’ DEFICIT Total liabilities and shareholders’ deficit 35.612 December 31.268 8. 2015 $ 5 279 61 345 RESTRICTED CASH AND CASH EQUIVALENTS 22. Inc.925 $ 1.925 1.168 16. net Prepaid expenses and other current assets Total current assets $ 1.278 253 81 1. plant and equipment.972 LONG-TERM DEBT DEFERRED INCOME TAXES OTHER LONG-TERM LIABILITIES 37. INC.524 (46) $ 39.316 .006 856 1. First Quarter 2016 Earnings Release Page 2 of 7 40.972 1.168 16. 2016 ASSETS CURRENT ASSETS: Cash and cash equivalents Accounts receivable. net 8.524 $ 39.590 77 (219) $ Addendum to Charter Communications.006 800 1.316 $ 1.294 6. net Goodwill Total investment in cable properties.375 331 332 OTHER NONCURRENT ASSETS Total assets LIABILITIES AND SHAREHOLDERS’ DEFICIT CURRENT LIABILITIES: Accounts payable and accrued liabilities Total current liabilities $ 40. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (dollars in millions) March 31.345 6.CHARTER COMMUNICATIONS.

NET $ 1. end of period CASH PAID FOR INTEREST. net Deferred income taxes Other. net of effects from acquisitions: Accounts receivable Prepaid expenses and other assets Accounts payable. beginning of period 5 3 CASH AND CASH EQUIVALENTS.278 $ 20 $ 448 $ 255 Addendum to Charter Communications. INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in millions) Three Months Ended March 31.139 Repayments of long-term debt 332 (727) (392) Payments for debt issuance costs (17) — Purchase of treasury stock (16) (16) 5 6 Proceeds from exercise of options and warrants Other. net Net cash flows from investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings of long-term debt 2. First Quarter 2016 Earnings Release Page 3 of 7 . Inc. plant and equipment (429) (351) Change in accrued expenses related to capital expenditures (56) (76) Change in restricted cash and cash equivalents (49) (1) (2) (13) (536) (441) Other.273 17 CASH AND CASH EQUIVALENTS.CHARTER COMMUNICATIONS. accrued liabilities and other Net cash flows from operating activities (188) $ (81) 539 514 24 19 7 8 5 6 28 34 3 3 24 21 (21) (26) 3 30 424 528 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property. net 1 Net cash flows from financing activities — 1. 2016 2015 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ Adjustments to reconcile net loss to net cash flows from operating activities: Depreciation and amortization Stock compensation expense Noncash interest expense Loss on derivative instruments. net Changes in operating assets and liabilities.385 (70) NET INCREASE IN CASH AND CASH EQUIVALENTS 1.

070 342 6.598 12.04 $ 111. 2015 (a) 12.322 5.066 2.062 12.022 34.311 4. Inc. Addendum to Charter Communications.783 12.515 12.74 $ 31 All percentages are calculated using whole numbers.3% 28.702 10 141 29 115 35 186 47 191 2.3% 34.4% 39.412 Residential Primary Service Units ("PSU") Video Internet Voice 4. except per customer and penetration data) Approximate as of March 31.946 Single Play Penetration (f) Double Play Penetration (f) Triple Play Penetration (f) 39.481 11.854 12.12 30 $ 179.284 390 6.2% 29.509 1.674 6. 2015 (a) 34.036 Quarterly Net Additions/(Losses) Video Internet Voice Single Play (e) Double Play (e) Triple Play (e) (13) 125 42 154 2.53 113 359 231 703 108 345 218 671 96 300 185 581 5 14 13 32 4 14 10 28 1 10 8 19 169.3% 39.6% 12.385 1.CHARTER COMMUNICATIONS.388 405 6.368 2. AND SUBSIDIARIES UNAUDITED SUMMARY OF OPERATING STATISTICS (in thousands.227 2.332 5.458 1.739 1.633 12.793 6.6% 32.790 2.4% 32.5% 32.2% Customer Relationships (d) Residential Small and Medium Business Total Customer Relationships 6.1% % Residential Non-Video Customer Relationships 32.1% 28. See footnotes to unaudited summary of operating statistics on page 5 of this addendum.7% 44.813 2.333 4.8% 22.138 Penetration Statistics (c) Video Penetration of Estimated Video Passings Internet Penetration of Estimated Internet Passings Voice Penetration of Estimated Voice Passings March 31.2% 31.6% 45. First Quarter 2016 Earnings Release Page 4 of 7 173. Minor differences may exist due to rounding.3% 28.588 12.74 26 .745 12.475 12. 2016 (a) Footprint (b) Estimated Video Passings Estimated Internet Passings Estimated Voice Passings December 31.0% Monthly Residential Revenue per Residential Customer (g) $ Small and Medium Business PSUs Video Internet Voice Quarterly Net Additions/(Losses) Video Internet Voice Monthly Small and Medium Business Revenue per Customer (h) $ Enterprise PSUs (i) Enterprise PSUs 111.5% 23.19 $ 109.5% 23.6% 41. INC.147 4.910 2.

Addendum to Charter Communications.(a) We calculate the aging of customer accounts based on the monthly billing cycle for each account.700 customers. as a percentage of residential customer relationships. double play and triple play penetration represents the number of residential single play. (h) Monthly small and medium business revenue per customer is calculated as total small and medium business quarterly revenue divided by three divided by average small and medium business customer relationships during the respective quarter. 900 and 700 customers. (e) Single play.900. respectively. 2015. respectively. encompassing video. 38. approximately 1. Total customer relationships excludes enterprise customer relationships. double play and triple play customers. respectively. customers include approximately 27. These estimates are based upon the information available at this time and are updated for all periods presented when new information becomes available. December 31. 1. 2016. Internet and voice quarterly revenue divided by three divided by average residential customer relationships during the respective quarter. whose accounts were over 60 days. (d) Customer relationships include the number of customers that receive one or more levels of service.700 and 900 customers. (c) Penetration represents residential and small and medium business customers as a percentage of estimated passings for the service indicated.100 and 27. whose accounts were over 90 days and approximately 900. apartment and condominium units and small and medium business and enterprise sites passed by our cable distribution network in the areas where we offer the service indicated.100. On that basis. Internet and voice services. Small and medium business customers are counted based on the number of customer locations. (f) Single play. without regard to which service(s) such customers receive. two or three of Charter service offerings. double play and triple play customers represent customers that subscribe to one. whose accounts were over 120 days. Inc. such as single family homes. (g) Monthly residential revenue per residential customer is calculated as total residential video. at March 31. (b) Passings represent our estimate of the number of units. respectively. (i) Enterprise PSUs represents the aggregate number of Charter's fiber service offerings counting each separate service offering at each customer location as an individual PSU. 2015 and March 31. Customers who reside in residential multiple dwelling units ("MDUs") and that are billed under bulk contracts are counted based on the number of billed units within each bulk MDU. First Quarter 2016 Earnings Release Page 5 of 7 . respectively.

net $ Adjusted EBITDA less capital expenditures $ Net cash flows from operating activities Less: Purchases of property. 2016 2015 Net loss Plus: Interest expense. Addendum to Charter Communications. The above schedules are presented in order to reconcile adjusted EBITDA and free cash flows. AND SUBSIDIARIES UNAUDITED RECONCILIATION OF NON-GAAP MEASURES TO GAAP MEASURES (dollars in millions) Three Months Ended March 31. plant and equipment Free cash flow (188) $ 454 454 $ 424 $ (429) 449 528 (351) (56) (76) (61) $ 101 (a) See page 1 of this addendum for detail of the components included within adjusted EBITDA. net Other. both non-GAAP measures. INC. First Quarter 2016 Earnings Release Page 6 of 7 . plant and equipment $ Change in accrued expenses related to capital expenditures $ (81) 24 5 289 35 514 19 6 21 18 883 (429) 800 (351) 28 539 Adjusted EBITDA (a) Less: Purchases of property.CHARTER COMMUNICATIONS. Inc. net Income tax expense Depreciation and amortization Stock compensation expense Loss on derivative instruments. to the most directly comparable GAAP measures in accordance with Section 401(b) of the Sarbanes-Oxley Act.

INC. land. First Quarter 2016 Earnings Release Page 7 of 7 . 2016 2015 Commercial services $ 64 $ 51 Transition $ 53 $ 14 Addendum to Charter Communications. Inc. fiber/coaxial cable. not related to customer premise equipment. (d) Upgrade/rebuild includes costs to modify or replace existing fiber/coaxial cable networks..g. 2016 Customer premise equipment (a) $ 2015 137 Scalable infrastructure (b) $ 150 110 75 Line extensions (c) 47 39 Upgrade/Rebuild (d) 41 23 Support capital (e) 94 64 Total capital expenditures (f) $ 429 $ 351 (a) Customer premise equipment includes costs incurred at the customer residence to secure new customers and revenue generating units. buildings and vehicles).g. or provide service enhancements (e. to secure growth of new customers and revenue generating units. including betterments. electronic equipment. (b) Scalable infrastructure includes costs. non-network equipment.. including customer installation costs and customer premise equipment (e. set-top boxes and cable modems). (f) Total capital expenditures for the three months ended March 31. (e) Support capital includes costs associated with the replacement or enhancement of non-network assets due to technological and physical obsolescence (e. make-ready and design engineering). (c) Line extensions include network costs associated with entering new service areas (e.g.CHARTER COMMUNICATIONS. 2016 and 2015 include the following (dollars in millions): Three Months Ended March 31. amplifiers.. headend equipment).. AND SUBSIDIARIES CAPITAL EXPENDITURES (dollars in millions) Three Months Ended March 31.g.