Exhibit 99.1
 
 


November 4, 2010

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 2010 FINANCIAL RESULTS

·  
Consolidated revenue of $171.5 million
·  
Adjusted EBITDA of $62.7 million
·  
Net income of $7.6 million or $0.14 per diluted share
·  
Increase in stock repurchase program and repurchase of common stock

ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its third quarter 2010 results with revenues increasing to $171.5 million and adjusted EBITDA increasing to a record $62.7 million. After the close of the third quarter, GCI repurchased approximately 7.5 million GCI shares held by Arctic Slope Regional Corporation (“ASRC”).

Revenues for the third quarter increased 13.7 percent over revenues of $150.8 million in the third quarter of 2009 and adjusted EBITDA increased $12.4 million or 24.8 percent over the third quarter 2009 EBITDA of $50.3 million. EBITDA margin for the third quarter of 2010 improved to 36.6 percent as compared to 33.3 percent in the prior year.

Net income for the third quarter of 2010 totaled $7.6 million or earnings per diluted share of $0.14 and compares to net income of $4.3 million, or earnings per diluted share of $0.08 for the same period of 2009.
 
“Four years ago, GCI undertook a major investment program to take advantage of substantial growth opportunities in the Alaska market, particularly mobile wireless service.  GCI’s financial results for the third quarter as well as for the year-to-date confirm that our decision to reinvest in the state was the right thing to do,” said GCI president Ron Duncan. “Fueled by that investment program, all of GCI’s business lines are performing very well, and we are on our way to another year of record high revenues and adjusted EBITDA.”

“GCI’s strong financial performance, particularly our growing free cash flow, and strengthening customer metrics gave us confidence to pursue the repurchase of the GCI shares held by ASRC last month. The transaction is a win for both companies. ASRC has met its return objectives on its GCI investment over the past 2½ years, and GCI has reduced its total shares outstanding by 13.6 percent.”

GCI’s third quarter 2010 EBITDA was favorably affected by $3.8 million of refunds received as a result of settling billing disputes with several vendors that reduced cost of goods sold for the quarter. The increases in contribution margin resulting from the vendor refunds were offset in part by $1.9 million in accrued airplane accident expenses.

GCI’s third quarter 2010 revenues increased $9.2 million or 5.7 percent over total revenues of $162.3 million in the second quarter of 2010. Adjusted EBITDA increased $5.4 million or 9.4 percent over adjusted EBITDA of $57.4 million in the second quarter of 2010 in spite of the fact that the second quarter of 2010 included a $3.0 million net revenue adjustment mostly attributable to a change in USF estimates.

 
 
 
 “GCI originally guided to revenues of $610 million to $620 million and adjusted EBITDA of $200 to $204 million for the year 2010.” said Duncan. “The company's practice is to provide guidance only on an annual basis. Continued success in consumer, improvements in commercial, and stabilizing trends in network access, however, lead us to conclude that GCI will exceed its revenue and adjusted EBITDA guidance for the year.”
 
Highlights
·  
In October of 2010, GCI repurchased 7,486,240 shares of its Class A common stock for $10.16 per share in a privately negotiated transaction with ASRC. The purchase price of approximately $76 million was funded by available cash and a $30 million temporary draw on the company’s revolving facility. The $30 million revolver loan is expected to be repaid before year end.

·  
GCI is the second largest wireless provider in Alaska with 136,500 wireless subscribers at the end of the third quarter of 2010, an increase of 5,300 wireless subscribers from the end of the second quarter of 2010.

·  
Consumer revenues for the third quarter of 2010 totaled $88.7 million, a 18.3 percent increase over the third quarter of 2009 and an increase of 6.8 percent over the second quarter of 2010, excluding $4.1 million in USF estimate changes in the second quarter of 2010.

·  
GCI had 144,700 access lines at the end of the third quarter of 2010, representing an estimated 36 percent share of the total access line market in Alaska. Access lines increased by 1,700 lines over the third quarter of 2009 and decreased by 700 lines from the second quarter of 2010.

·  
GCI’s facilities-based access lines totaled 109,500, representing 76 percent of its total access lines at the end of the third quarter of 2010, a decrease of 200 lines from the second quarter of 2010 and an increase of 5,100 lines when compared to the end of the third quarter of the prior year.

·  
GCI had 115,200 consumer and commercial cable modem customers at the end of the third quarter of 2010, an increase of 900 over the 114,300 cable modem customers at the end of the second quarter 2010. Average monthly revenue per cable modem for the third quarter of 2010 was $50.61, an increase of 16.6 percent over the $43.42 figure posted in the third quarter of 2009 and an increase of 8.4 percent over the $46.69 figure posted for the second quarter of 2010.

·  
In October of 2010, GCI’s Board of Directors amended GCI’s stock repurchase program to authorize the company to repurchase up to $100 million worth of its outstanding shares. The ASRC transaction reduces the amount available under the program by approximately $76 million. Depending on company performance, market conditions, liquidity, and subject to board oversight GCI may continue repurchasing its own shares.

Consumer
Consumer revenues increased 18.3 percent to $88.7 million as compared to $75.0 million in the third quarter of 2009 and increased 1.8 percent over $87.1 million in the second quarter of 2010. Revenue increases were strong for all consumer products and services. Consumer revenues were favorably impacted by a $4.1 million USF estimate change in the second quarter of 2010.

Consumer voice revenues of $14.6 million increased 16.9 percent when compared to the third quarter a year ago and decreased 4.3 percent from the second quarter of 2010. Consumer voice revenues in the
 
 
 
 
third quarter of 2010 were favorably impacted by an increase in customers and USF support when compared to the prior year. Consumer voice revenues would have increased 3.9 percent over the second quarter of 2010, excluding a $1.2 million USF revenue adjustment in the second quarter of 2010. Consumer local access lines in service at the end of third quarter of 2010 totaled 84,700, an increase of 2,000 lines over the third quarter of 2009. Total access lines decreased by 400 lines sequentially.

GCI serves 77,100 consumer access lines on its own facilities, an increase of 4,400 lines over the third quarter of 2009. More than 91 percent of consumer access lines are provisioned exclusively on GCI facilities.

Consumer video revenues of $29.7 million increased 7.6 percent over the prior year and increased 1.3 percent over the second quarter of 2010. The increases are due in part to increases in video subscribers purchasing higher tiered services and renting high definition/digital video recorder converters. Consumer video subscribers totaled 130,500 at the end of the third quarter of 2010, an increase of 900 subscribers over the third quarter of 2009 and a decrease of 700 subscribers from the second quarter of 2010.

Consumer data revenues of $15.8 million increased 24.1 percent over the prior year and 8.1 percent over the second quarter of 2010. The increase in consumer data revenues is due to an increase in cable modem customers and increasing average monthly revenue per cable modem. GCI added 6,500 consumer cable modem customers over the prior year and cable modem customer counts increased by 900 on a sequential basis.

Consumer wireless revenues increased to $28.6 million, an increase of 28.8 percent over the third quarter of 2009 driven by an increase in wireless subscribers. Since the end of the third quarter a year ago, consumer has added 13,000 wireless customers, an increase of 11.8 percent. Consumer wireless revenues increased 2.4 percent over the second quarter of 2010. Consumer wireless revenues would have increased 14.2 percent over the second quarter of 2010, excluding a $2.9 million USF revenue adjustment in the second quarter of 2010. Consumer added 3,900 wireless customers as compared to the end of the second quarter of 2010.

Network Access
Network access revenues decreased 6.8 percent to $28.2 million as compared to $30.3 million in the third quarter of 2009 and increased 4.0 percent over the second quarter of 2010.

Voice revenues, as expected, decreased 29.2 percent from the prior year and increased 20.3 percent over the second quarter of 2010. The decrease in voice revenues from the prior year is primarily due to decreasing average revenue per minute and the transition of voice traffic to dedicated networks. The declining revenue per minute is largely due to the renegotiation of long-term contracts with GCI’s largest carrier customers during 2009. The sequential increase in voice revenues is primarily attributable to a $1.1 million reclassification of certain revenues from the data revenue category.
 
Data revenues were down 4.5 percent compared to the third quarter of 2009 and decreased 10.2 percent from the second quarter of 2010. The decrease in data revenues is primarily due to the aforementioned $1.1 million reclassification and, in part, due to lower rates resulting from increased competition. The lower rates were partially offset by increases in data network capacity purchased by common carrier customers.

Wireless revenues, primarily related to roaming traffic, increased $2.2 million over the prior year and increased $1.2 million sequentially.

 
 
 
Commercial
Commercial revenues for the third quarter increased $7.7 million, an increase of 27.6 percent, to $35.4 million as compared to $27.8 million in the third quarter of 2009 and increased $3.4 million over $32.1 million in the second quarter of 2010. The increase in revenues is primarily due to an increase in special project work. Commercial revenues were favorably impacted by a $0.6 million USF estimate change during the second quarter of 2010.

Voice revenues increased 4.4 percent over the prior year and decreased 5.0 percent sequentially. Voice revenues were steady on a sequential basis excluding $0.4 million of the total $0.6 million USF estimate change in the second quarter of 2010. Long distance minutes decreased 2.6 percent from the prior year and increased 1.4 percent over the second quarter of 2010. Commercial local access lines increased by 800 over the third quarter of 2009 and increased 100 lines sequentially.

Commercial video revenues increased $0.6 million over the prior year and $0.3 million sequentially.
 
Commercial data services 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 $9.2 million increased by $0.6 million as compared to the third quarter of 2009 and time and material charges for support activities increased by $5.8 million to $13.0 million for the third quarter of 2010 as a result of increased activity primarily in the state’s oil sector. Commercial data service revenues were $22.2 million in the third quarter of 2010, up $6.4 million over the third quarter of 2009 and $3.4 million over the second quarter of 2010.

Commercial wireless revenues totaled $2.3 million for the third quarter, an increase of 14.7 percent over the prior year and an increase of 5.0 percent sequentially. Wireless revenue increased sequentially 15.7 percent excluding the USF adjustment in the second quarter of 2010. GCI had 13,600 Commercial wireless subscribers at the end of the third quarter, an increase of 1,400 subscribers over the second quarter of 2010.
 
Managed Broadband                                     
        Managed broadband revenues totaled $13.5 million in the third quarter of 2010, an increase of 15.7 percent over $11.7 million in the third quarter of 2009 and a 30.4 percent increase sequentially, including the $1.7 million reserve adjustment reported in the second quarter of 2010.

Regulated Operations
Regulated operations revenues totaled $5.6 million in the third quarter of 2010 as compared to $6.0 million in the third quarter of 2009. Regulated operations revenues for the third quarter of 2010 were steady with the second quarter of 2010. Regulated operations had 10,200 local access lines at the end of the third quarter of 2010, a decrease of 400 access lines from the second quarter of 2010.

Other Items
GCI’s third quarter 2010 capital expenditures totaled $24.7 million as compared to $31.5 million in the third quarter of 2009 and $27.1 million in the second quarter of 2010.

GCI will hold a conference call to discuss the quarter’s results on Thursday, November 4, 2010 beginning at 2 p.m. (Eastern). To access the briefing on November 4, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-324-6913 (International callers should dial 1-212-287-1671) 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 800-262-4859, access code 7461 (International callers should dial 203-369-3220.)

GCI is the largest telecommunications company in Alaska. GCI’s cable plant, which provides voice, video, and broadband data services, passes 90 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.


#    #    #



 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
             
             
(Amounts in thousands)
            
   
September 30,
    
December 31,
  
Assets
  
2010
    
2009
  
             
Current assets:
            
  Cash and cash equivalents
   $ 79,000       48,776  
 
                
  Receivables
     171,994       147,859  
  Less allowance for doubtful receivables
     9,913       7,060  
     Net receivables
     162,081       140,799  
 
                
  Deferred income taxes
     17,522       17,618  
  Prepaid expenses
     6,054       4,491  
  Inventories
     7,922       9,278  
  Other current assets
     5,282       5,872  
       Total current assets
     277,861       226,834  
 
                
Property and equipment in service, net of depreciation
     788,648       823,080  
Construction in progress
     40,692       26,161  
       Net property and equipment
     829,340       849,241  
 
                
Cable certificates
     191,635       191,565  
Goodwill
     73,452       73,452  
Wireless licenses
     25,967       25,967  
Other intangible assets, net of amortization
     17,494       19,561  
Deferred loan and senior notes costs, net of amortization
     14,159       13,168  
Other assets
     16,542       18,609  
    Total other assets
     339,249       342,322  
       Total assets
   $ 1,446,450       1,418,397  
                 
           
(Continued)
  
 
 
 
 
 
 
 
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Continued)
                 
                 
(Amounts in thousands)
                
   
September 30,
    
December 31,
  
Liabilities and Stockholders' Equity
     2010       2009  
                 
Current liabilities:
                
  Current maturities of obligations under long-term debt and capital leases
   $ 10,379       9,892  
  Accounts payable
     35,068       30,697  
  Deferred revenue
     22,461       21,404  
  Accrued payroll and payroll related obligations
     22,140       21,874  
  Accrued interest
     16,914       14,821  
  Accrued liabilities
     12,522       15,037  
  Subscriber deposits
     1,205       1,549  
     Total current liabilities
     120,689       115,274  
 
                
Long-term debt, net
     773,830       771,247  
Obligations under capital leases, excluding current maturities
     85,461       89,279  
Obligation under capital lease due to related party
     1,883       1,876  
Deferred income taxes
     110,550       100,386  
Long-term deferred revenue
     50,410       52,342  
Other liabilities
     23,269       21,676  
       Total liabilities
     1,166,092       1,152,080  
 
                
                 
Commitments and contingencies
                
Stockholders’ equity:
                
  Common stock (no par):
                
   Class A. Authorized 100,000 shares; issued 52,022 and 51,899 shares at
     September 30, 2010 and December 31, 2009, respectively; outstanding
      51,525 and 51,627 shares at September 30, 2010 and December 31,
      2009, respectively
     149,550       150,911  
    Class B. Authorized 10,000 shares; issued and outstanding 3,181 and
      3,186 shares at September 30, 2010 and December 31, 2009,
      respectively; convertible on a share-per-share basis into Class A
      common stock
     2,680       2,684  
    Less cost of 496 and 272 Class A common shares held in
      treasury at September 30, 2010 and December 31, 2009, respectively
     (2,354 )     (2,339 )
  Paid-in capital
     35,950       30,410  
  Retained earnings
     94,532       84,651  
       Total stockholders' equity
     280,358       266,317  
                 
       Total liabilities and stockholders' equity
   $ 1,446,450       1,418,397  




 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENT
(Unaudited)
                         
   
Three Months Ended
    
Nine Months Ended
  
   
September 30,
    
September 30,
  
(Amounts in thousands, except per share amounts)
  
2010
    
2009
    
2010
    
2009
  
Revenues
   $ 171,509       150,816       486,254       448,301  
Cost of goods sold (exclusive of depreciation and amortization shown
  separately below)
     52,486       50,167       153,147       145,372  
Selling, general and administrative expenses
     58,532       49,045       166,493       157,350  
Depreciation and amortization expense
     30,288       30,874       92,234       92,778  
   Operating income
     30,203       20,730       74,380       52,801  
Other income (expense):
                                
  Interest expense (including amortization of deferred loan fees)
     (17,760 )     (13,176 )     (53,169 )     (39,096 )
  Interest income
     99       49       236       68  
    Other expense, net
     (17,661 )     (13,127 )     (52,933 )     (39,028 )
     Income before income tax expense
     12,542       7,603       21,447       13,773  
Income tax expense
     4,959       3,267       10,260       6,519  
     Net income
   $ 7,583       4,336       11,187       7,254  
Basic net income per Class A common share
   $ 0.14       0.08       0.20       0.14  
Basic net income per Class B common share
   $ 0.14       0.08       0.20       0.14  
Diluted net income per Class A common share
   $ 0.14       0.08       0.20       0.13  
Diluted net income per Class B common share
   $ 0.14       0.08       0.20       0.13  
                                 
Common shares used to calculate Class A basic EPS
     51,496       50,125       51,521       49,705  
                                 
Common shares used to calculate Class A diluted EPS
     54,940       53,828       54,808       53,457  

 
 
 



GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
(Amounts in thousands)
                                                                    
   
Third Quarter 2010
    
Third Quarter 2009
  
         
Network
          
Managed
    
 Regulated
          
Network
          
Managed
    
 Regulated
  
   
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
    
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 14,601       8,636       8,025       -       5,595       36,857      $ 12,487       12,197       7,688       -       6,037       38,409  
  Video
     29,720       -       2,953       -       -       32,673       27,612       -       2,320       -       -       29,932  
  Data
     15,797       14,208       22,211       13,548       -       65,764       12,726       14,876       15,801       11,715       -       55,118  
  Wireless
     28,595       5,360       2,260       -       -       36,215       22,196       3,190       1,971       -       -       27,357  
    Total
     88,713       28,204       35,449       13,548       5,595       171,509       75,021       30,263       27,780       11,715       6,037       150,816  
                                                                                                 
Cost of goods sold
     25,374       5,547       16,731       3,545       1,289       52,486       24,686       7,536       13,310       2,893       1,742       50,167  
                                                                                                 
    Contribution
     63,339       22,657       18,718       10,003       4,306       119,023       50,335       22,727       14,470       8,822       4,295       100,649  
                                                                                                 
Less SG&A
     33,248       8,178       9,955       4,392       2,759       58,532       26,547       8,255       8,090       3,157       2,996       49,045  
    EBITDA
     30,091       14,479       8,763       5,611       1,547       60,491       23,788       14,472       6,380       5,665       1,299       51,604  
                                                                                                 
Add share-based
  compensation
     1,121       549       362       215       3       2,250       (554 )     (388 )     (226 )     (164 )     -       (1,332 )
    Adjusted EBITDA
   $ 31,212       15,028       9,125       5,826       1,550       62,741     $ 23,234       14,084       6,154       5,501       1,299       50,272  
                                                                                                 
                                                                                                 
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
  
SUPPLEMENTAL SCHEDULES
    
(Unaudited)
    
(Amounts in thousands)
                                                                                          
   
Third Quarter 2010
      
Second Quarter 2010
    
           
Network
            
Managed
    
 Regulated
            
Network
            
Managed
    
 Regulated
  
   
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
    
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
  
Revenues
                                                                                                
  Voice
   $ 14,601       8,636       8,025       -       5,595       36,857      $ 15,254       7,176       8,448       -       5,607       36,485  
  Video
     29,720       -       2,953       -       -       32,673       29,352       -       2,639       -       -       31,991  
  Data
     15,797       14,208       22,211       13,548       -       65,764       14,608       15,823       18,831       10,387       -       59,649  
  Wireless
     28,595       5,360       2,260       -       -       36,215       27,935       4,113       2,153       -       -       34,201  
    Total
     88,713       28,204       35,449       13,548       5,595       171,509       87,149       27,112       32,071       10,387       5,607       162,326  
                                                                                                 
Cost of goods sold
     25,374       5,547       16,731       3,545       1,289       52,486       26,192       6,379       15,097       3,160       926       51,754  
                                                                                                 
    Contribution
     63,339       22,657       18,718       10,003       4,306       119,023       60,957       20,733       16,974       7,227       4,681       110,572  
                                                                                                 
Less SG&A
     33,248       8,178       9,955       4,392       2,759       58,532       30,445       7,897       9,179       4,219       2,964       54,704  
    EBITDA
     30,091       14,479       8,763       5,611       1,547       60,491       30,512       12,836       7,795       3,008       1,717       55,868  
                                                                                                 
Add share-based
  compensation
     1,121       549       362       215       3       2,250       825       390       273       155       -       1,643  
Add non-cash
  contribution adjustment
     -       -       -       -       -       -       (82 )     (39 )     (24 )     (15 )     -       (160 )
    Adjusted EBITDA
   $ 31,212       15,028       9,125       5,826       1,550       62,741     $ 31,255       13,187       8,044       3,148       1,717       57,351  
                                                                                                 
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
    
SUPPLEMENTAL SCHEDULES
    
(Unaudited)
    
(Amounts in thousands)
                                                                                          
   
Nine Months Ended September 30, 2010
      
Nine Months Ended September 30, 2009
    
           
Network
            
Managed
    
 Regulated
            
Network
            
Managed
    
 Regulated
  
   
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
    
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
  
Revenues
                                                                                                
  Voice
   $ 43,711       22,471       24,316       -       17,262       107,760      $ 39,390       39,975       23,373       -       18,574       121,312  
  Video
     88,096       -       7,909       -       -       96,005       82,114       -       6,591       -       -       88,705  
  Data
     44,531       46,360       56,544       36,020       -       183,455       36,654       48,903       47,725       33,323       -       166,605  
  Wireless
     79,892       12,668       6,474       -       -       99,034       60,981       5,704       4,994       -       -       71,679  
    Total
     256,230       81,499       95,243       36,020       17,262       486,254       219,139       94,582       82,683       33,323       18,574       448,301  
                                                                                                 
Cost of goods sold
     77,199       18,454       44,199       9,923       3,372       153,147       72,100       20,776       39,642       7,939       4,915       145,372  
                                                                                                 
    Contribution
     179,031       63,045       51,044       26,097       13,890       333,107       147,039       73,806       43,041       25,384       13,659       302,929  
                                                                                                 
Less SG&A
     92,858       23,919       28,279       12,654       8,783       166,493       83,772       27,900       26,413       10,760       8,505       157,350  
    EBITDA
     86,173       39,126       22,765       13,443       5,107       166,614       63,267       45,906       16,628       14,624       5,154       145,579  
                                                                                                 
Add share-based
  compensation
     2,329       1,119       785       460       3       4,696       817       617       346       117       -       1,897  
Add non-cash
  contribution adjustment
     (82 )     (39 )     (24 )     (15 )     -       (160 )     220       151       73       36       -       480  
    Adjusted EBITDA
   $ 88,420       40,206       23,526       13,888       5,110       171,150     $ 64,304       46,674       17,047       14,777       5,154       147,956  

 
 
 


GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
KEY PERFORMANCE INDICATORS
(Unaudited)
                                           
                     
September 30, 2010
    
September 30, 2010
  
                     
as compared to
    
as compared to
  
   
September 30,
    
September 30,
    
June 30,
    
September 30,
    
June 30,
    
September 30,
    
June 30,
  
   
2010
    
2009
    
2010
    
2009
    
2010
    
2009
    
2010
  
Consumer
                                          
Voice
                                          
Long-distance subscribers
     89,000       89,900       90,200       (900 )     (1,200 )     -1.0 %     -1.3 %
Total local access lines in service
     84,700       82,700       85,100       2,000       (400 )     2.4 %     -0.5 %
Local access lines in service on GCI facilities
     77,100       72,700       77,100       4,400       -       6.1 %     0.0 %
                                                         
Video
                                                        
Basic subscribers
     130,500       129,600       131,200       900       (700 )     0.7 %     -0.5 %
Digital programming tier subscribers
     80,600       77,600       80,600       3,000       -       3.9 %     0.0 %
HD/DVR converter boxes
     87,500       77,000       86,500       10,500       1,000       13.6 %     1.2 %
Homes passed
     234,900       231,400       234,700       3,500       200       1.5 %     0.1 %
                                                         
Data
                                                        
Cable modem subscribers
     104,400       97,900       103,500       6,500       900       6.6 %     0.9 %
                                                         
Wireless
                                                        
Wireless lines in service
     122,900       109,900       119,000       13,000       3,900       11.8 %     3.3 %
                                                         
Network Access Services
                                                        
Data:
                                                        
Total ISP access lines in service
     1,700       1,700       1,700       -       -       0.0 %     0.0 %
Total ISP access lines in service on GCI facilities
     1,300       1,400       1,400       (100 )     (100 )     -7.1 %     -7.1 %
                                                         
Commercial
                                                        
Voice:
                                                        
Long-distance subscribers
     9,300       9,700       9,400       (400 )     (100 )     -4.1 %     -1.1 %
Total local access lines in service
     48,100       47,300       48,000       800       100       1.7 %     0.2 %
Local access lines in service on GCI facilities
     20,900       19,000       20,600       1,900       300       10.0 %     1.5 %
                                                         
Video
                                                        
Hotels and mini-headend
  subscribers
     16,000       18,000       18,500       (2,000 )     (2,500 )     -11.1 %     -13.5 %
Basic subscribers
     1,800       1,700       1,800       100       -       5.9 %     0.0 %
   Total basic subscribers
     17,800       19,700       20,300       (1,900 )     (2,500 )     -9.6 %     -12.3 %
                                                         
Data
                                                        
Cable modem subscribers
     10,800       10,600       10,800       200       -       1.9 %     0.0 %
                                                         
Wireless
                                                        
Wireless lines in service
     13,600       10,100       12,200       3,500       1,400       34.7 %     11.5 %
                                                         
Regulated Operations
                                                        
Voice:
                                                        
Total local access lines in service
     10,200       11,300       10,600       (1,100 )     (400 )     -9.7 %     -3.8 %
                                                         
                           
September 30, 2010
  
September 30, 2010
   
Three Months Ended
            
as Compared to
    
as Compared to
  
   
September 30,
    
September 30,
    
June 30,
    
September 30,
    
June 30,
    
September 30,
    
June 30,
  
      2010       2009       2010       2009       2010       2009       2010  
Consumer
                                                        
Voice
                                                        
Long-distance minutes carried
  (in millions)
     25.6       28.0       26.7       (2.4 )     (1.1 )     -8.6 %     -4.1 %
                                                         
Video
                                                        
Average monthly gross revenue per
  subscriber
   $ 75.85     $ 70.95     $ 74.54     $ 4.90     $ 1.31       6.9 %     1.8 %
                                                         
Wireless
                                                        
Average monthly gross revenue per
  subscriber
   $ 74.61     $ 64.17     $ 75.07     $ 10.44     $ (0.46 )     16.3 %     -0.6 %
                                                         
Network Access Services
                                                        
Voice
                                                        
Long-distance minutes carried
  (in millions)
     205.4       224.6       201.3       (19.2 )     4.1       -8.5 %     2.0 %
                                                         
Commercial
                                                        
Voice:
                                                        
Long-distance minutes carried
  (in millions)
     29.8       30.6       29.4       (0.8 )     0.4       -2.6 %     1.4 %
                                                         
Total
                                                        
Long-distance minutes carried
  (in millions)
     260.8       283.2       257.4       (22.4 )     3.4       -7.9 %     1.3 %



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


   
Three Months Ended
  
   
September 30,
2010
    
September 30,
2009
    
June 30,
2010
  
Net income
   $ 7.6       4.3       1.9  
Income tax expense
     4.9       3.3       5.5  
Income before income tax expense
     12.5       7.6       7.4  
                         
Other (income) expense:
                        
Interest expense
  (including amortization of deferred loan fees)
     17.8       13.2       17.8  
Interest income
     (0.1 )     (0.1 )     (0.1 )
Other expense, net
     17.7       13.1       17.7  
                         
Operating income
     30.2       20.7       25.1  
Depreciation and amortization expense
     30.3       30.9       30.8  
                         
EBITDA (Note 2)
     60.5       51.6       55.9  
Share-based compensation
     2.2       (1.3 )     1.6  
Non-cash contribution adjustment
     ---       ---       (0.1 )
Adjusted EBITDA (Note 1)
   $ 62.7       50.3       57.4  


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


             
   
Nine Months Ended
  
   
September 30,
2010
    
September 30,
2009
  
Net income
   $ 11.2       7.3  
Income tax expense
     10.2       6.5  
Income before income tax expense
     21.4       13.8  
                 
Other (income) expense:
                
Interest expense
  (including amortization of deferred loan fees)
     53.2       39.0  
Interest income
     (0.2 )     (0.1 )
Other expense, net
     53.0       38.9  
                 
Operating income
     74.4       52.7  
Depreciation and amortization expense
     92.2       92.9  
                 
EBITDA (Note 2)
     166.6       145.6  
Share-based compensation
     4.7       1.9  
Non-cash contribution adjustment
     (0.1 )     0.5  
Adjusted EBITDA (Note 1)
   $ 171.2       148.0  

Notes:
 
(1) EBITDA (as defined in Note 2 below) before deducting share-based compensation 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 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.
 
.