Exhibit 99.1
October 31, 2007
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 THIRD QUARTER 2007 FINANCIAL RESULTS
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|
• |
Consolidated revenue of $133.9 million |
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|
• |
Net income of $2.2 million or $0.04 per diluted share |
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|
• |
EBITDAS of $38.7 million |
ANCHORAGE, AK -- GCI (NASDAQ:GNCMA) today reported net income of $2.2 million, or earnings per diluted share of $0.04, for the third quarter of 2007. The company’s third quarter net income compares to income of $6.5 million, or earnings per diluted share of $0.12 in the same period of 2006.
GCI’s third quarter 2007 revenues totaled $133.9 million, an increase of 7.0 percent over the third quarter of 2006. Revenue increases from video, data and wireless were partially offset, as expected, from decreasing voice revenues. Voice revenues decreased across the company’s business segments as a result of lower rates and fewer long distance minutes carried on its network.
Third quarter 2007 earnings before interest, taxes, depreciation, amortization and share based compensation expense (EBITDAS) totaled $38.7 million. EBITDAS decreased $2.6 million or 6.4 percent from the third quarter of 2006. The decrease in EBITDAS was primarily attributable to a decrease in EBITDAS from the network access and commercial segments, offset in part, by strong growth in the consumer segment.
Sequentially, revenues for the company increased $4.3 million, an increase of 3.3 percent, over second quarter 2007 revenues of $129.6 million. Third quarter EBITDAS of $38.7 million decreased 6.4 percent from $41.3 million in the second quarter of 2007. Sequential increases in revenue occurred in all business segments. The increase in EBITDAS from the consumer segment was offset by decreases from the network access, commercial and managed broadband segments.
“Our consumer business had a spectacular quarter,” said GCI president, Ron Duncan. “Customer metrics were up all across the board including solid increases in wire line, wireless, high speed data and video customers. We significantly outpaced our largest competitor in each of these categories adding more than three times as many high speed customers and almost twice as many wireless customers.”
"We are also doing very well with the efforts to grow our local service footprint and convert all of our local services to our own facilities. We had an increase of 5,300 access lines on our own facilities in the third quarter and ended the quarter with more than half of our total access lines exclusively on our own facilities. Our plan for complete facilities independence is making excellent progress.”
“Unfortunately our strong success in the marketplace was offset by continued challenges in our carrier business which is down significantly from the prior year. The reductions in carrier traffic and some sluggishness in our commercial sector overwhelmed the success of our consumer business to produce very disappointing financial results for the quarter.”
“The carrier market has been volatile this year and we have confronted both pricing pressures and traffic shifts. We are working aggressively to address the challenges in the carrier market and our goal going forward is to maintain carrier EBITDA at this year’s levels. If we can do that we expect that continued strong growth in customer and operating metrics will allow us to achieve the previously stated goals of our five year plan.”
“I am also very pleased to announce that our wireless subsidiary signed a five year agreement with Sprint that will make Alaska DigiTel Sprint’s preferred roaming partner throughout Alaska.”
GCI will discuss year end financial guidance during its third quarter conference call beginning at 2 pm Eastern time, November 1, 2007. Details for participating in the call are listed near the end of this news release.
Highlights
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|
• |
Consumer revenues totaled $56.6 million, an increase of 25.1 percent over the prior year and an increase of 3.1 percent from the second quarter of 2007. The increases were across all products and services. |
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|
• |
GCI local access lines increased by 900 for the quarter. Consumer, network access and commercial local access lines totaled 114,800 at the end of the third quarter of 2007, representing an estimated 27 percent share of the total access lines market in Alaska. GCI began offering competitive local service to Kodiak in August, 2007, Wasilla in September, 2007, and Sitka, Kenai and Soldotna in October, 2007. |
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|
• |
GCI has provisioned 57,800 consumer and commercial access lines on its own facilities at the end of the third quarter of 2007, an increase of 5,300 lines over the second quarter of 2007 and an increase of 22,300 lines when compared to the prior year. The company had provisioned 35,500 consumer and commercial access lines on its own facilities at the end of the third quarter of 2006. |
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|
• |
GCI had 92,400 consumer and commercial cable modem access customers at the end of the third quarter of 2007, an increase of 1,700 over the 90,700 cable modem customers at the end of the second quarter 2007. Average monthly revenue per cable modem totaled $33.59 for the third quarter of 2007 as compared to $32.54 for the second quarter of 2007, an increase of 3.2 percent. |
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|
• |
GCI had 73,300 wireless subscribers (including the subscribers of its consolidated subsidiary, Alaska DigiTel), an increase of 3,700 subscribers from the second quarter of 2007. |
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• |
Effective October 30, 2007, Alaska Digitel has entered into a Strategic Roaming Agreement ("SRA") with Sprint. Under the five year agreement, Alaska Digitel will provide certain voice and data roaming services to Sprint throughout the Alaska market. Additionally, Sprint has agreed to provide voice and data roaming services to Alaska Digitel on Sprint network throughout the L48. |
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|
• |
Following the third quarter of 2007 and prior to GCI’s blackout period beginning October 12, 2007, the company purchased approximately 218,300 of its shares at an average cost of $12.08 per share. The company is authorized to purchase an additional $13.8 million of its shares through the end of 2007. |
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|
• |
GCI announced its Southeast Alaska fiber project that will connect communities with more than 50,000 customers in the cities of Ketchikan, Wrangell, Petersburg, Angoon, and Sitka. The Southeast fiber system, slated to be active by November 2008, will comprise 754 miles of fiber extending from our Alaska United West line first to Ketchikan and then through the communities of Southeast Alaska and back up to Juneau where it will connect to the Alaska United east fiber thus creating a SONET ring. |
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|
• |
On October 15, 2007 GCI announced the purchase of the telecommunications subsidiaries of United Companies, Inc. in a $40 million stock purchase transaction. The subsidiaries’ assets include a long-haul microwave network and a rural local exchange carrier with more than 12,000 access lines. The subsidiaries have net debt of approximately $30 million. |
Consumer
Consumer revenues increased 25.1 percent to $56.6 million as compared to $45.2 million in the third quarter of 2006 and increased 3.1 percent from the second quarter of 2007. The increase in revenue is primarily due to an increase in data and wireless sales, including wireless sales from Alaska DigiTel. The year-over-year increase also benefited from a 6.0 percent increase in video revenues.
Consumer voice revenues were relatively unchanged when compared to the prior year and the second quarter of 2007. Long distance minutes decreased, as expected, from the prior year and sequentially. Consumer local access lines in service for the second quarter were up approximately 2,100 lines compared to the third quarter of 2006. Access lines in the third quarter increased by 1,100 over the second quarter of 2007. GCI began offering competitive local service to Eagle River, Chugiak, Ketchikan, Kodiak, Wasilla, Sitka, Soldotna and Kenai during 2007. These new service areas represent more than 58,000 consumer access lines.
GCI serves 45,900 consumer access lines on its own facilities, an increase of 4,100 lines from the second quarter of 2007. Assuming an average lease rate of $25.00 per line per month these access lines represent avoided costs with annual run rate savings of $13.8 million.
Consumer video revenues increased 6.0 percent over the prior year and were relatively unchanged from the second quarter of 2007. The increase in revenue is due in part to increasing average revenue per customer in certain markets and increases in video subscribers purchasing digital service and renting high definition/digital video recorder converters. Consumer video subscribers increased to 125,600, an increase of 3,800 subscribers from the third quarter of 2006 and an increase of 900 subscribers from the second quarter of 2007.
Consumer data revenues increased 16.8 percent over the prior year and 5.8 percent over the second quarter of 2007. The increase in consumer data revenues is due to an increase in cable modem customers and an increase in average monthly revenue. GCI added 7,300 consumer cable modem customers over the prior year and 1,500 customers during the third quarter of 2007.
Network Access
Network access revenues decreased 5.0 percent to $42.7 million as compared to $44.9 million in the third quarter of 2006 and increased 2.5 percent from the second quarter of 2007.
Voice revenues decreased 18.6 percent from the prior year and increased 5.2 percent from the second quarter of 2007. The decrease in voice revenues from the prior year is primarily due to the effects of a scheduled rate reduction and fewer minutes carried on GCI’s network for other common carriers. Network access minutes decreased 14.0 percent to 321.4 million minutes for the third quarter of 2007 as compared to the third quarter of 2006. Minutes for the third quarter of 2007 increased 1.2 percent from the second quarter of 2007.
Data revenues for the third quarter of 2007 were up 13.7 percent when compared to third quarter 2006 and down 3.5 percent from the second quarter of 2007. The increase in data revenues over the prior year is primarily due to an increase in circuits sold.
Commercial
Commercial revenues decreased 4.5 percent to $27.2 million as compared to $28.5 million in the third quarter of 2006 and increased 4.2 percent from $26.1 million in the second quarter of 2007. Commercial revenues decreased from the prior year primarily due to a decrease in long distance voice and data revenues. Revenues improved sequentially primarily due to growth from seasonal video and special project revenues.
The decrease in long distance revenues were primarily due to a decrease in long distance customers making calls and minutes for the third quarter as compared to the prior year and sequentially.
Video revenues were up both year-over-year and sequentially due to seasonal increases, mostly from hotel customers. Basic commercial video customers were unchanged from the prior year and decreased, as expected, by 400 subscribers when compared to the second quarter of 2007. The seasonal decrease in subscribers for the third quarter of 2007 compares to a decrease of 900 subscribers in the third quarter of 2006.
Commercial data revenues in the third quarter of 2007 totaled $15.9 million and compare to $17.5 million in the third quarter of 2006. Data revenue increases from other commercial customers and special projects have offset $1.3 million of the $2.9 million decrease in quarterly revenues earned on GCI’s fiber optic cable from Prudhoe Bay to Valdez. Data revenues for the third quarter increased $1.4 million or 9.6 percent, when compared to $14.5 million in the second quarter of 2007. The increase was due primarily to an increase in special project revenues.
Managed Broadband
Managed broadband revenues totaled $7.4 million in the third quarter of 2007, an increase of 14.6 percent from $6.4 million in the third quarter of 2006. Revenue was up 6.0 percent from the $7.0 million in the second quarter of 2007.
Other Items
Total selling, general and administrative expenses (SG&A) increased 12.8 percent to $49.0 million as compared to $43.4 million in the third quarter of 2006 and increased 3.1 percent from the second quarter of 2007. The increase in SG&A from the prior year was primarily due to the consolidation of Alaska DigiTel and increases in labor and benefits costs. Excluding Alaska DigiTel and non-cash share based compensation costs, SG&A increased 1.3 percent as compared to the prior year and increased 1.0 percent from the second quarter of 2007.
During the third quarter of 2007 GCI’s capital expenditures totaled $37.5 million as compared to $43.6 million in the second quarter of 2007. GCI’s capital expenditures include those of Alaska DigiTel. GCI’s year-to-date capital expenditures totaled $110.5 million.
GCI will hold a conference call to discuss the quarter’s results on Thursday, November 1, 2007 beginning at 2 p.m. (Eastern). To access the briefing on November 1, dial 888-913-9965 (International callers should dial 210-234-0001) 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 800-216-3057, access code 7461 (International callers should dial 402-220-3763.)
GCI is the largest telecommunications company in Alaska. A pioneer in bundled services, GCI provides local, wireless, and long distance telephone, cable television, Internet and data communication services throughout Alaska. More information about the company can be found atwww.gci.com.
The foregoing contains forward-looking statements regarding the company’s expected results that are based on management’s expectations as well as on a number of assumptions concerning future events. Actual results may 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 |
||||
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
(Amounts in thousands) |
|
September 30, |
|
December 31, |
|
Assets |
|
2007 |
|
2006 |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ 24,945 |
|
57,647 |
|
Restricted cash |
|
- |
|
4,612 |
|
|
|
|
|
|
|
Receivables |
|
90,168 |
|
78,811 |
|
Less allowance for doubtful receivables |
|
2,681 |
|
2,922 |
|
Net receivables |
|
87,487 |
|
75,889 |
|
|
|
|
|
|
|
Deferred income taxes, net |
|
12,559 |
|
20,685 |
|
Prepaid expenses |
|
5,349 |
|
5,729 |
|
Inventories |
|
4,310 |
|
3,362 |
|
Property held for sale |
|
1,280 |
|
2,316 |
|
Notes receivable from related parties |
|
44 |
|
1,080 |
|
Other current assets |
|
1,034 |
|
1,988 |
|
Total current assets |
|
137,008 |
|
173,308 |
|
|
|
|
|
|
|
Property and equipment in service, net of depreciation |
|
478,805 |
|
454,879 |
|
Construction in progress |
|
65,071 |
|
29,994 |
|
Net property and equipment |
|
543,876 |
|
484,873 |
|
|
|
|
|
|
|
Cable certificates |
|
191,565 |
|
191,565 |
|
Goodwill |
|
42,181 |
|
42,181 |
|
Wireless certificates |
|
26,925 |
|
1,497 |
|
Other intangible assets, net of amortization |
|
11,328 |
|
7,011 |
|
Deferred loan and senior notes costs, net of amortization |
|
6,353 |
|
7,091 |
|
Other assets |
|
8,419 |
|
7,133 |
|
Total other assets |
|
286,771 |
|
256,478 |
|
Total assets |
|
$ 967,655 |
|
914,659 |
|
|
|
|
|
|
|
|
|
|
|
(Continued) |
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GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
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|
CONSOLIDATED BALANCE SHEETS |
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|
(Continued) |
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|
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
(Amounts in thousands) |
|
September 30, |
|
December 31, |
|
Liabilities, Minority Interest, and Stockholders' Equity |
|
2007 |
|
2006 |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Current maturities of obligations under long-term debt and capital leases |
|
$ 2,368 |
|
1,792 |
|
Accounts payable |
|
34,149 |
|
28,404 |
|
Deferred revenue |
|
16,057 |
|
16,566 |
|
Accrued payroll and payroll related obligations |
|
14,407 |
|
14,598 |
|
Accrued liabilities |
|
8,252 |
|
8,377 |
|
Accrued interest |
|
3,010 |
|
8,710 |
|
Subscriber deposits |
|
766 |
|
489 |
|
Total current liabilities |
|
79,009 |
|
78,936 |
|
|
|
|
|
|
|
Long-term debt |
|
526,565 |
|
487,737 |
|
Obligations under capital leases, excluding current maturities |
|
2,275 |
|
2,229 |
|
Obligation under capital lease due to related party,
excluding current |
|
495 |
|
561 |
|
Deferred income taxes |
|
86,331 |
|
86,998 |
|
Other liabilities |
|
13,544 |
|
12,725 |
|
Total liabilities |
|
708,219 |
|
669,186 |
|
|
|
|
|
|
|
Minority interest |
|
6,485 |
|
- |
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
Common stock (no par): |
|
|
|
|
|
Class A. Authorized 100,000 shares; issued 49,953 and
50,191 |
|
149,786 |
|
157,502 |
|
Class B. Authorized 10,000 shares; issued 3,257 and
3,370 shares at |
|
2,751 |
|
2,846 |
|
Less cost of 288 and 258 Class A and Class B common
shares held in |
|
(1,388) |
|
(1,436) |
|
Paid-in capital |
|
24,939 |
|
20,641 |
|
Notes receivable with related parties issued upon stock option exercise |
|
- |
|
(738) |
|
Retained earnings |
|
76,863 |
|
66,658 |
|
Total stockholders' equity |
|
252,951 |
|
245,473 |
|
|
|
|
|
|
|
Total liabilities, minority interest, and stockholders' equity |
|
$ 967,655 |
|
914,659 |
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
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|
CONSOLIDATED INCOME STATEMENT |
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|
|
|
|
|
|
|
|
|
|
(Unaudited) |
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|
|
Three Months Ended |
|
Nine Months Ended |
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|
|
September 30, |
|
September 30, |
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|
(Amounts in thousands, except per share amounts) |
2007 |
|
2006 (as amended) |
|
2007 |
|
2006 (as amended) |
|
|
|
|
|
|
|
|
|
|
Revenues |
$ 133,864 |
|
125,081 |
|
388,035 |
|
356,123 |
|
|
|
|
|
|
|
|
|
|
Cost of goods sold (exclusive of depreciation and
amortization shown |
47,878 |
|
41,523 |
|
133,229 |
|
116,065 |
|
Selling, general and administrative expenses |
48,956 |
|
43,391 |
|
144,966 |
|
125,639 |
|
Depreciation and amortization expense |
22,837 |
|
20,390 |
|
66,033 |
|
60,723 |
|
Operating income |
14,193 |
|
19,777 |
|
43,807 |
|
53,696 |
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
Interest expense |
(9,042) |
|
(8,995) |
|
(26,683) |
|
(26,245) |
|
Loan and senior notes fees |
(751) |
|
(251) |
|
(1,147) |
|
(753) |
|
Interest income |
82 |
|
759 |
|
427 |
|
1,398 |
|
Minority interest |
37 |
|
181 |
|
26 |
|
350 |
|
Other expense, net |
(9,674) |
|
(8,306) |
|
(27,377) |
|
(25,250) |
|
|
|
|
|
|
|
|
|
|
Income before income tax expense and cumulative effect
of a change in |
4,519 |
|
11,471 |
|
16,430 |
|
28,446 |
|
|
|
|
|
|
|
|
|
|
Income tax expense |
2,306 |
|
4,989 |
|
7,672 |
|
13,058 |
|
|
|
|
|
|
|
|
|
|
Income before cumulative effect of a change in accounting principle |
2,213 |
|
6,482 |
|
8,758 |
|
15,388 |
|
|
|
|
|
|
|
|
|
|
Cumulative effect of a change in accounting principle,
net of income tax |
- |
|
- |
|
- |
|
64 |
|
|
|
|
|
|
|
|
|
|
Net income available to common shareholders |
$ 2,213 |
|
6,482 |
|
8,758 |
|
15,452 |
|
|
|
|
|
|
|
|
|
|
Basic net income available to common shareholders per common share: |
|
|
|
|
|
|
|
|
Income available to common shareholders before
cumulative effect |
$ 0.04 |
|
0.12 |
|
0.16 |
|
0.28 |
|
Cumulative effect of a change in accounting principle |
- |
|
- |
|
- |
|
- |
|
Net income available to common shareholders |
$ 0.04 |
|
0.12 |
|
0.16 |
|
0.28 |
|
|
|
|
|
|
|
|
|
|
Diluted net income available to common shareholders per common share: |
|
|
|
|
|
|
|
|
Income available to common shareholders before
cumulative effect |
$ 0.04 |
|
0.12 |
|
0.15 |
|
0.28 |
|
Cumulative effect of a change in accounting principle |
- |
|
- |
|
- |
|
- |
|
Net income available to common shareholders |
$ 0.04 |
|
0.12 |
|
0.15 |
|
0.28 |
|
|
|
|
|
|
|
|
|
|
Common shares used to calculate basic EPS |
52,852 |
|
53,345 |
|
53,103 |
|
54,030 |
|
|
|
|
|
|
|
|
|
|
Common shares used to calculate diluted EPS |
54,203 |
|
54,874 |
|
54,611 |
|
55,548 |
|
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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|
|
|
|
|
|
|
|
|
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|
|
Third Quarter 2007 |
|
Third Quarter 2006 (as amended) |
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|
|
|
Network |
|
Managed |
|
|
|
Network |
|
Managed |
|
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|
|
Consumer |
Access |
Commercial |
Broadband |
Totals |
|
Consumer |
Access |
Commercial |
Broadband |
Totals |
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|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
||||
|
Voice |
$ 11,714 |
25,856 |
7,803 |
- |
45,373 |
|
11,679 |
31,772 |
8,204 |
- |
51,655 |
||||
|
Video |
23,834 |
- |
2,148 |
- |
25,982 |
|
22,486 |
- |
2,122 |
- |
24,608 |
||||
|
Data |
8,704 |
14,920 |
15,949 |
7,369 |
46,942 |
|
7,450 |
13,127 |
17,523 |
6,428 |
44,528 |
||||
|
Wireless |
12,371 |
1,881 |
1,315 |
- |
15,567 |
|
3,628 |
- |
662 |
- |
4,290 |
||||
|
Total |
56,623 |
42,657 |
27,215 |
7,369 |
133,864 |
|
45,243 |
44,899 |
28,511 |
6,428 |
125,081 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Cost of goods |
21,302 |
11,554 |
13,352 |
1,670 |
47,878 |
|
16,638 |
9,886 |
13,937 |
1,062 |
41,523 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Contribution |
35,321 |
31,103 |
13,863 |
5,699 |
85,986 |
|
28,605 |
35,013 |
14,574 |
5,366 |
83,558 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Less SG&A |
24,765 |
10,912 |
9,698 |
3,581 |
48,956 |
|
20,936 |
9,772 |
9,720 |
2,963 |
43,391 |
||||
|
Add other |
14 |
16 |
7 |
- |
37 |
|
- |
- |
- |
181 |
181 |
||||
|
EBITDA |
10,570 |
20,207 |
4,172 |
2,118 |
37,067 |
|
7,669 |
25,241 |
4,854 |
2,584 |
40,348 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Add share-based |
565 |
583 |
350 |
130 |
1,628 |
|
340 |
356 |
232 |
81 |
1,009 |
||||
|
EBITDAS |
$ 11,135 |
20,790 |
4,522 |
2,248 |
38,695 |
|
8,009 |
25,597 |
5,086 |
2,665 |
41,357 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
|||||||||||
|
SUPPLEMENTAL SCHEDULES |
|||||||||||
|
(Unaudited) |
|||||||||||
|
(Amounts in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter 2007 |
|
Second Quarter 2007 |
||||||||
|
|
|
Network |
|
Managed |
|
|
|
Network |
|
Managed |
|
|
|
Consumer |
Access |
Commercial |
Broadband |
Totals |
|
Consumer |
Access |
Commercial |
Broadband |
Totals |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Voice |
$ 11,714 |
25,856 |
7,803 |
- |
45,373 |
|
11,564 |
24,577 |
8,002 |
- |
44,143 |
|
Video |
23,834 |
- |
2,148 |
- |
25,982 |
|
23,907 |
- |
2,004 |
- |
25,911 |
|
Data |
8,704 |
14,920 |
15,949 |
7,369 |
46,942 |
|
8,229 |
15,468 |
14,546 |
6,954 |
45,197 |
|
Wireless |
12,371 |
1,881 |
1,315 |
- |
15,567 |
|
11,195 |
1,570 |
1,576 |
- |
14,341 |
|
Total |
56,623 |
42,657 |
27,215 |
7,369 |
133,864 |
|
54,895 |
41,615 |
26,128 |
6,954 |
129,592 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods |
21,302 |
11,554 |
13,352 |
1,670 |
47,878 |
|
20,714 |
8,700 |
11,528 |
1,296 |
42,238 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contribution |
35,321 |
31,103 |
13,863 |
5,699 |
85,986 |
|
34,181 |
32,915 |
14,600 |
5,658 |
87,354 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less SG&A |
24,765 |
10,912 |
9,698 |
3,581 |
48,956 |
|
23,760 |
10,420 |
9,887 |
3,419 |
47,486 |
|
Add other |
14 |
16 |
7 |
- |
37 |
|
(10) |
(10) |
(4) |
- |
(24) |
|
EBITDA |
10,570 |
20,207 |
4,172 |
2,118 |
37,067 |
|
10,411 |
22,485 |
4,709 |
2,239 |
39,844 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add share-based |
565 |
583 |
350 |
130 |
1,628 |
|
506 |
539 |
312 |
121 |
1,478 |
|
EBITDAS |
$ 11,135 |
20,790 |
4,522 |
2,248 |
38,695 |
|
10,917 |
23,024 |
5,021 |
2,360 |
41,322 |
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
|||||||||||
|
SUPPLEMENTAL SCHEDULES |
|||||||||||
|
(Unaudited) |
|||||||||||
|
(Amounts in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, 2007 |
|
Nine Months Ended September 30, 2006 |
||||||||
|
|
|
Network |
|
Managed |
|
|
|
Network |
|
Managed |
|
|
|
Consumer |
Access |
Commercial |
Broadband |
Totals |
|
Consumer |
Access |
Commercial |
Broadband |
Totals |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Voice |
$ 34,549 |
74,704 |
23,583 |
- |
132,836 |
|
34,443 |
84,100 |
24,324 |
- |
142,867 |
|
Video |
71,372 |
- |
5,918 |
- |
77,290 |
|
66,816 |
- |
5,781 |
- |
72,597 |
|
Data |
24,807 |
45,317 |
44,421 |
21,243 |
135,788 |
|
21,669 |
39,999 |
48,833 |
19,243 |
129,744 |
|
Wireless |
34,060 |
4,578 |
3,483 |
- |
42,121 |
|
9,201 |
- |
1,714 |
- |
10,915 |
|
Total |
164,788 |
124,599 |
77,405 |
21,243 |
388,035 |
|
132,129 |
124,099 |
80,652 |
19,243 |
356,123 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods |
62,437 |
29,752 |
36,489 |
4,551 |
133,229 |
|
49,480 |
27,456 |
35,931 |
3,198 |
116,065 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contribution |
102,351 |
94,847 |
40,916 |
16,692 |
254,806 |
|
82,649 |
96,643 |
44,721 |
16,045 |
240,058 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less SG&A |
71,930 |
33,198 |
29,230 |
10,608 |
144,966 |
|
58,864 |
28,772 |
28,045 |
9,958 |
125,639 |
|
Add other |
10 |
11 |
5 |
- |
26 |
|
- |
- |
- |
350 |
350 |
|
EBITDA |
30,431 |
61,660 |
11,691 |
6,084 |
109,866 |
|
23,785 |
67,871 |
16,676 |
6,437 |
114,769 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add share-based |
1,427 |
1,471 |
899 |
336 |
4,133 |
|
1,488 |
1,623 |
969 |
330 |
4,410 |
|
EBITDAS |
$ 31,858 |
63,131 |
12,590 |
6,420 |
113,999 |
|
25,273 |
69,494 |
17,645 |
6,767 |
119,179 |
|
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES |
||||||||||
|
KEY PERFORMANCE INDICATORS |
||||||||||
|
(Unaudited) |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2007 |
|
September 30, 2007 |
||
|
|
|
|
|
|
|
as compared to |
|
as compared to |
||
|
|
|
September 30, |
September 30, |
June 30, |
|
September 30, |
June 30, |
|
September 30, |
June 30, |
|
|
|
2007 |
2006 |
2007 |
|
2006 |
2007 |
|
2006 |
2007 |
|
Consumer |
|
|
|
|
|
|
|
|
|
|
|
Voice |
|
|
|
|
|
|
|
|
|
|
|
|
Long-distance subscribers |
89,700 |
91,200 |
90,500 |
|
(1,500) |
(800) |
|
-1.6% |
-0.9% |
|
|
Total local access lines in service |
69,500 |
67,400 |
68,400 |
|
2,100 |
1,100 |
|
3.1% |
1.6% |
|
|
Local access lines in service on GCI facilities |
45,900 |
27,500 |
41,800 |
|
18,400 |
4,100 |
|
66.9% |
9.8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Video |
|
|
|
|
|
|
|
|
|
|
|
|
Basic subscribers |
125,600 |
121,800 |
124,700 |
|
3,800 |
900 |
|
3.1% |
0.7% |
|
|
Digital programming tier subscribers |
62,600 |
56,500 |
61,000 |
|
6,100 |
1,600 |
|
10.8% |
2.6% |
|
|
HD/DVR converter boxes |
43,600 |
22,800 |
40,200 |
|
20,800 |
3,400 |
|
91.2% |
8.5% |
|
|
Homes passed |
222,100 |
218,100 |
221,100 |
|
4,000 |
1,000 |
|
1.8% |
0.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Data |
|
|
|
|
|
|
|
|
|
|
|
|
Cable modem subscribers |
84,100 |
76,800 |
82,600 |
|
7,300 |
1,500 |
|
9.5% |
1.8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Wireless |
|
|
|
|
|
|
|
|
|
|
|
|
Wireless lines in service |
66,100 |
21,700 |
62,900 |
|
44,400 |
3,200 |
|
204.6% |
5.1% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Network Access Services |
|
|
|
|
|
|
|
|
|
|
|
Voice: |
|
|
|
|
|
|
|
|
|
|
|
|
Total ISP access lines in service |
2,600 |
3,100 |
2,600 |
|
(500) |
- |
|
-16.1% |
0.0% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
|
|
|
|
|
|
|
|
|
|
|
Voice: |
|
|
|
|
|
|
|
|
|
|
|
|
Long-distance subscribers |
10,800 |
11,500 |
11,100 |
|
(700) |
(300) |
|
-6.1% |
-2.7% |
|
|
Total local access lines in service |
42,700 |
41,700 |
42,900 |
|
1,000 |
(200) |
|
2.4% |
-0.5% |
|
|
Local access lines in service on GCI facilities |
11,900 |
8,000 |
10,700 |
|
3,900 |
1,200 |
|
48.8% |
11.2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Video |
|
|
|
|
|
|
|
|
|
|
|
|
Hotels and mini-headend |
15,200 |
15,600 |
15,600 |
|
(400) |
(400) |
|
-2.6% |
-2.6% |
|
|
Basic subscribers |
1,900 |
1,500 |
1,900 |
|
400 |
- |
|
26.7% |
0.0% |
|
|
Total basic subscribers |
17,100 |
17,100 |
17,500 |
|
- |
(400) |
|
0.0% |
-2.3% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Data |
|
|
|
|
|
|
|
|
|
|
|
|
Cable modem subscribers |
8,300 |
7,200 |
8,100 |
|
1,100 |
200 |
|
15.3% |
2.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Wireless |
|
|
|
|
|
|
|
|
|
|
|
|
Wireless lines in service |
7,200 |
4,200 |
6,700 |
|
3,000 |
500 |
|
71.4% |
7.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Broadband |
|
|
|
|
|
|
|
|
|
|
|
|
SchoolAccess® customers |
51 |
48 |
48 |
|
3 |
3 |
|
6.3% |
6.3% |
|
|
ConnectMD® customers |
21 |
22 |
21 |
|
(1) |
- |
|
-4.5% |
0.0% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2007 |
|
September 30, 2007 |
|||
|
|
|
Three Months Ended |
|
as Compared to |
|
as Compared to |
||||
|
|
|
September 30, |
September 30, |
June 30, |
|
September 30, |
June 30, |
|
September 30, |
June 30, |
|
|
|
2007 |
2006 |
2007 |
|
2006 |
2007 |
|
2006 |
2007 |
|
Consumer |
|
|
|
|
|
|
|
|
|
|
|
Voice |
|
|
|
|
|
|
|
|
|
|
|
|
Long-distance minutes carried |
33.2 |
34.3 |
33.6 |
|
(1.1) |
(0.4) |
|
-3.2% |
-1.2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Video |
|
|
|
|
|
|
|
|
|
|
|
|
Average monthly gross revenue per |
$ 63.44 |
$ 61.66 |
$ 63.79 |
|
$ 1.78 |
$ (0.35) |
|
2.9% |
-0.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Wireless |
|
|
|
|
|
|
|
|
|
|
|
|
Average monthly gross revenue per |
$ 58.25 |
$ 49.27 |
$ 55.25 |
|
$ 8.98 |
$ 3.00 |
|
18.2% |
5.4% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Network Access Services |
|
|
|
|
|
|
|
|
|
|
|
Voice |
|
|
|
|
|
|
|
|
|
|
|
|
Long-distance minutes carried |
321.4 |
373.6 |
317.7 |
|
(52.2) |
3.7 |
|
-14.0% |
1.2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
|
|
|
|
|
|
|
|
|
|
|
Voice: |
|
|
|
|
|
|
|
|
|
|
|
|
Long-distance minutes carried |
33.5 |
33.8 |
34.1 |
|
(0.3) |
(0.6) |
|
-0.9% |
-1.8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
Long-distance minutes carried |
388.1 |
441.7 |
385.4 |
|
(53.6) |
2.7 |
|
-12.1% |
0.7% |
General Communication, Inc.
Non-GAAP Financial Reconciliation Schedule
(Unaudited, Amounts in Millions)
|
|
|
Three Months Ended |
||||
|
|
|
September 30, |
|
September 30, |
|
June 30, 2007 |
|
Net income available to common shareholders |
$ |
2.2 |
|
6.5 |
|
5.0 |
|
Income tax expense |
|
2.3 |
|
5.0 |
|
4.1 |
|
Income before income tax expense |
|
4.5 |
|
11.5 |
|
9.1 |
|
|
|
|
|
|
|
|
|
Other (income) expense: |
|
|
|
|
|
|
|
Interest expense |
|
9.0 |
|
9.0 |
|
9.0 |
|
Amortization of loan and senior notes fee expense |
|
0.8 |
|
0.3 |
|
0.2 |
|
Interest income |
|
(0.1) |
|
(0.8) |
|
(0.2) |
|
Minority interest |
|
--- |
|
(0.2) |
|
--- |
|
Other expense, net |
|
9.7 |
|
8.3 |
|
9.0 |
|
|
|
|
|
|
|
|
|
Operating income |
|
14.2 |
|
19.8 |
|
18.1 |
|
Depreciation and amortization expense |
|
22.8 |
|
20.4 |
|
21.7 |
|
Minority interest |
|
--- |
|
0.2 |
|
--- |
|
|
|
|
|
|
|
|
|
EBITDA (Note 2) |
|
37.0 |
|
40.4 |
|
39.8 |
|
Share-based compensation expense |
|
1.7 |
|
1.0 |
|
1.5 |
|
EBITDAS (Note 1) |
$ |
38.7 |
|
41.4 |
|
41.3 |
|
|
|
Nine Months Ended |
||
|
|
|
September 30, |
|
September 30, |
|
Net income available to common shareholders |
$ |
8.8 |
|
15.5 |
|
Cumulative effect of a change in accounting principle, net of income tax benefit of $0.0 |
|
--- |
|
(0.1) |
|
Income before income tax expense |
|
8.8 |
|
15.4 |
|
Income tax expense |
|
7.7 |
|
13.1 |
|
Income before income tax expense and cumulative effect of a change in accounting principle |
|
16.5 |
|
28.5 |
|
|
|
|
|
|
|
Other (income) expense: |
|
|
|
|
|
Interest expense |
|
26.7 |
|
26.2 |
|
Amortization of loan and senior notes fee expense |
|
1.1 |
|
0.8 |
|
Interest income |
|
(0.4) |
|
(1.4) |
|
Minority interest |
|
--- |
|
(0.4) |
|
Other expense, net |
|
27.4 |
|
25.2 |
|
|
|
|
|
|
|
Operating income |
|
43.9 |
|
53.7 |
|
Depreciation and amortization expense |
|
66.0 |
|
60.7 |
|
Minority interest |
|
--- |
|
0.4 |
|
|
|
|
|
|
|
EBITDA (Note 2) |
|
109.9 |
|
114.8 |
|
Share-based compensation expense |
|
4.1 |
|
4.4 |
|
EBITDAS (Note 1) |
$ |
114.0 |
|
119.2 |
Notes:
(1) EBITDA (as defined in Note 2 below) before deducting share-based compensation expense.
(2) EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is the sum of Net Income, Interest Expense, Loan and Senior Notes 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 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.