Exhibit 99.1
 


March 7, 2012

John Lowber, (907) 868-5628; jlowber@gci.com
Bruce Broquet, (907) 868-6660; bbroquet@gci.com
David Morris, (907) 265-5396; dmorris@gci.com

FOR IMMEDIATE RELEASE

GCI REPORTS 2011 FINANCIAL RESULTS

·  
Consolidated revenue of $679.4 million
·  
Adjusted EBITDA of $223.6 million
·  
Net income of $5.8 million or $0.12 per diluted share

ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its 2011 results with revenues increasing to $679.4 million over revenues of $651.3 million in 2010. Adjusted EBITDA for 2011 was $223.6 million, an increase of $2.1 million over Adjusted EBITDA of $221.5 million for 2010.

For the fourth quarter of 2011, revenues totaled $168.8 million as compared to $165.0 million in the fourth quarter of 2010. Revenues were down $8.9 million sequentially when compared to third quarter 2011 revenues of $177.7 million. Adjusted EBITDA for the fourth quarter of 2011 was $52.3 million, an increase of 3.8 percent over the fourth quarter of 2010 and a decrease, as expected, of 17.2 percent from the seasonal peak third quarter of 2011.

Revenues and EBITDA for the fourth quarter and the year 2011 were unfavorably impacted by the November 29, 2011 FCC order implementing final rules for the calculation of support from the Universal Service Fund (USF) high cost program. The final rules, effective for the year 2012, accelerated the timing of an adjustment to USF accounts receivable which reduced GCI’s reported revenue and EBITDA by $3.5 million in the fourth quarter of 2011. GCI had previously expected the order would affect the company’s results beginning with the first quarter of 2012.
 
Net income for 2011 totaled $5.8 million or earnings per diluted share of $0.12, a decrease from net income of $9.0 million or earnings per share of $0.17 for 2010.

“GCI’s completion of it’s TERRA Southwest network on budget and nearly two years ahead of schedule was the highlight of 2011,” said GCI President Ron Duncan. “This $88 million project which provides the first terrestrial connectivity for residents of southwest Alaska is an important platform for future growth.”

“Unfortunately 2011 performance was not as strong as we would have liked in our other key growth area of wireless. A nearly six month delay in the completion of our 4G network delayed plans for new products and devices and impeded subscriber growth. GCI has now rolled out its HSPA+ network covering Alaska's major population centers and we have a competitive offering of smartphones and modems capable of utilizing our new network. We will continue to expand the coverage of this network through the end of 2012. “

“Excluding the adverse impact of the FCC Order, 2011 financial results were mostly in line with expectations. Revenues grew by more than four percent and, but for the FCC Order, EBITDAS, at $227 million, would have been at the high end of our revised guidance.”

GCI provided guidance on revenues of $685 million to $700 million and adjusted EBITDA of $225 million to $227 million for the year 2011, excluding any affects from the USF order. GCI’s revenue and EBITDA results for 2011 finished near the low end of the revenue range and near the high end of the EBITDA range, respectively, excluding the impact of the changes to the USF high cost program.

GCI anticipates revenues of $690 million to $720 million and adjusted EBITDA of $230 million to $240 million for the year 2012. Expectations for 2012 have been reduced by more than $13 million as a result of the FCC USF order.

Highlights
·  
GCI completed construction on TERRA-Southwest (TERRA-SW) and has transitioned the majority of its customers in the TERRA-SW region to the recently completed network. TERRA-SW is GCI’s project to extend terrestrial broadband service to Bristol Bay and the Yukon-Kuskokwim Delta and was completed by the end of 2011, two years ahead of schedule.

·  
GCI repurchased 5,228,885 shares of its Class A common stock in 2011 at an average price per share of $10.07. GCI is authorized to repurchase $92.9 million of its common equity depending on company performance, market conditions, and liquidity, and subject to board oversight. At the end of 2011, GCI had approximately 42.2 million shares outstanding.

·  
Managed Broadband revenues for 2011 totaled $63.2 million, an increase of $13.3 million or 26.6 percent over 2010. Fourth quarter 2011 revenues of $17.2 million increased $3.3 million over fourth quarter revenues of $13.9 million in 2010.

·  
Commercial revenues for 2011 increased $7.6 million to $136.1 million, as compared to revenues of $128.5 million in 2010. Fourth quarter 2011 revenues of $34.5 million increased 3.8 percent over the prior year. Commercial revenues were unfavorably impacted by $0.4 million in revenue adjustments due to changes to the USF high cost program in the fourth quarter of 2011.

·  
GCI is the second largest wireless provider in Alaska with 139,900 wireless subscribers at the end of 2011, an increase of 1,200 subscribers over the prior year. GCI has rolled out its HSPA+ network covering Alaska's major population centers and an additional nine towns and cities are covered by our HSPA network. We will continue to expand the coverage of this network through the end of 2012. 

·  
GCI had 119,400 consumer and commercial cable modem customers at the end of 2011, an increase of 3,000 customers over 116,400 customers at the end of 2010. Fourth quarter cable modem customers increased by 1,500 over 117,900 customers at the end of the third quarter 2011. Average monthly revenue per cable modem for the fourth quarter of 2011 was $61.37, an increase of 14.8 percent over the $53.47 figure posted for the prior year and 6.9 percent from the $57.43 figure posted for the third quarter of 2011.

·  
GCI had 138,100 access lines at the end of the fourth quarter of 2011, representing an estimated 36 percent share of the total access line market in Alaska. Access lines for 2011 decreased 4.6 percent from the total at the end of 2010 and decreased 0.8 percent from the third quarter of 2011.

·  
GCI’s facilities-based access lines totaled 109,800, representing 79.5 percent of its total access lines at the end of the fourth quarter of 2011. Facilities based access lines increased 100 lines over the third quarter of 2011.

Consumer
Consumer revenues increased 2.8 percent to $352.6 million as compared to $342.9 million in 2010. Data and wireless continue to drive financial results in the consumer business. Fourth quarter 2011 revenues of $86.3 million were steady when compared to the prior year and decreased 3.3 percent sequentially. Changes to the USF high cost program reduced consumer revenues by $3.1 million in fourth quarter of 2011.

Consumer voice revenues of $52.1 million, as expected, were lower as compared to $57.3 million in 2010. The decrease in consumer voice revenues was primarily due to a decrease in USF support rates and a decrease in access lines. Consumer local access lines in service at the end of the 2011 totaled 77,600, a decrease of 7,200 lines from 2010. The decrease in access lines is a result of customers discontinuing wire line service and relying solely on wireless devices. While GCI has consistently grown share in the wire line market, the share growth is no longer sufficient to offset the decreasing overall size of the wire line access market.

Fourth quarter 2011 consumer voice revenues of $11.5 million decreased 15.4 percent from the fourth quarter of 2010 and 12.6 percent sequentially. The decrease in revenues is due to the USF high cost program changes and a decrease in access lines. USF high cost program changes reduced voice revenues by $0.6 million for the fourth quarter of 2011. Total access lines decreased 1,500 lines sequentially.

GCI serves 72,000 consumer access lines on its own facilities, a decrease of 5,400 lines from 2010 and a decrease of 1,200 lines from the third quarter of 2011. More than 92 percent of consumer access lines are provisioned exclusively on GCI facilities.

Consumer video revenues of $118.6 million for 2011 were steady with the prior year. Fourth quarter 2011 video revenues of $29.6 million decreased 2.6 percent from the prior year and increased 1.5 percent sequentially. The decreases for the quarter are largely due to a decrease in video subscribers. Consumer basic video subscribers totaled 125,000 at the end of 2011, a decrease of 5,000 subscribers from 2010 and 1,400 subscribers from the third quarter of 2011.

Consumer data revenues of $72.0 million for 2011 increased 17.3 percent over the prior year. Fourth quarter 2011 data revenues of $19.9 million increased 18.4 percent over the prior year and 10.2 percent sequentially. The increase in consumer data revenues for the year and for the fourth quarter of 2011 is due to an increase in cable modem customers and increasing average monthly usage per cable modem. GCI added 2,600 consumer cable modem customers over the prior year and cable modem customer counts increased by 1,500 on a sequential basis.

Consumer wireless revenues increased to $109.9 million for 2011, an increase of 3.9 percent over 2010. Consumer had a decrease of 300 wireless customers from the end of 2010. Consumer wireless revenues grew by 6.3 percent over 2010, excluding a $2.5 million decrease in revenues from changes to the USF high cost program in the fourth quarter of 2011.

Consumer wireless revenues for the fourth quarter of 2011 decreased 2.1 percent from the fourth quarter of 2010 and 12.3 percent sequentially. The decrease in quarterly revenue is primarily due to the changes to the USF high cost program. Consumer had a decrease of 1,200 wireless customers during the fourth quarter of 2011.

Network Access
Network access revenues decreased 1.7 percent to $105.5 million in 2011 as compared to $107.2 million in 2010. Fourth quarter revenues of $25.7 million were steady with the prior year and decreased $3.7 million or 12.6 percent sequentially. The sequential decrease in quarterly revenues is primarily due to seasonality.

Voice revenues decreased 18.9 percent to $23.6 million from the prior year. Fourth quarter 2011 voice revenues of $5.4 million decreased 17.3 percent from the fourth quarter of the prior year and 12.6 percent sequentially. The continued decrease in wire line voice revenues was expected and is primarily due to wireless and data substitution. The sequential decrease in quarterly revenue is due in part to seasonality. Long distance minutes in 2011 decreased 3.2 percent from the prior year and fourth quarter 2011 minutes were down 2.9 percent from the fourth quarter of 2010 and decreased 11.3 percent on a seasonal basis from the third quarter of 2011.
 
Data revenues increased 1.6 percent compared to 2010. Fourth quarter 2011 data revenue of $15.3 million increased 1.2 percent over the fourth quarter of the prior year and decreased 10.6 percent sequentially. The increase in data revenues is primarily attributable to the continuing shift to IP-based transport.

Wireless revenues, primarily related to roaming traffic, increased $2.7 million or 16.4 percent to $19.4 million over 2010. On a quarterly basis, wireless roaming revenues continue to increase as compared to the prior year. The decrease in quarterly sequential revenues is primarily due to seasonality.

Commercial
Commercial revenues for 2011 increased $7.6 million, an increase of 5.9 percent, to $136.1 million as compared to $128.5 million in 2010. The increase in revenues for the year is primarily due to increases in special project work. Commercial revenues were unfavorably impacted by $0.4 million in revenue adjustments due to changes to the USF high cost program in fourth quarter of 2011.

Fourth quarter 2011 revenues of $34.5 million increased 3.8 percent over the fourth quarter of the prior year and decreased 3.1 percent on a sequential basis. Special project work drove the increase in revenues over the prior year but revenues were lower on a sequential basis as projects were completed during the fourth quarter.

Voice revenues for 2011 decreased 9.5 percent compared to the prior year. Long distance minutes decreased 3.6 percent from the prior year. Voice revenues for the fourth quarter decreased 10.0 percent compared to the prior year fourth quarter and 6.7 percent sequentially. Changes to the USF high cost program reduced voice revenues by $0.2 million in fourth quarter of 2011. Local access lines at the end of 2011 increased by 1,400 lines over 2010.

Commercial video revenues of $11.6 million increased by 3.8 percent compared to the prior year. Commercial video subscribers totaled 17,600 at the end of the year 2011, an increase of 500 subscribers over the end of the prior year.
 
Commercial data service revenues include both transmission charges for data circuits and time and materials charges for GCI on-site support of customer operations. Data transport charges of $39.9 million increased by $4.0 million as compared to 2010 and time and material charges for support activities increased by $5.1 million to $46.0 million for 2011 as a result of increased activity primarily in the oil sector. Commercial data service revenues were $86.0 million in 2011, up $9.1 million over 2010.

Commercial wireless revenues totaled $9.8 million for 2011, an increase of 12.4 percent over the prior year. Changes to the USF high cost program reduced wireless revenues by $0.2 million in fourth quarter of 2011. GCI had 15,300 Commercial wireless subscribers at the end of 2011, an increase of 1,500 subscribers over the prior year.

Managed Broadband
Managed broadband revenues totaled $63.2 million in 2011, an increase of 26.6 percent over $50.0 million in 2010. Fourth quarter 2011 revenue of $17.2 million increased 23.4 percent over the fourth quarter of the prior year and was steady with the third quarter of 2011. Managed Broadband segment revenues are expected to increase in 2012 as customers gain access to the newly completed TERRA–SW network.

Regulated Operations
Regulated operations revenues totaled $22.0 million in 2011 as compared to $22.7 million in 2010. Regulated operations revenues for the fourth quarter of 2011 decreased $0.4 million to $5.0 million when compared to the fourth quarter of 2010 and decreased $0.9 million from the third quarter of 2011. The decreases in revenue were primarily attributable to decreases in local access line revenues and decreases in pooled access revenues. Regulated operations had 9,100 local access lines at the end of the fourth quarter of 2011, a decrease of 200 access lines from the third quarter of 2011.

Other Items
SG&A expenses for 2011 totaled $235.5 million, an increase of 2.9 percent as compared to $228.8 million for 2010. The increase is due in part to increases in health care costs and labor and related benefits. As a percentage of revenues, SG&A expenses were steady at 35 percent in 2011 when compared to 2010.

GCI’s 2011 capital expenditures totaled $186.4 million as compared to $100.6 million in 2010. Cash capital expenditures total $177.1 million for 2011 and compare to $96.2 million in 2010. GCI’s total capital expenditures for 2011 include $78.2 million related to the TERRA-SW project. GCI has incurred $87.1 million of project costs to date. The total reimbursable cost for the project is $88.2 million. GCI received $70.3 million in loans and grants against the total reimbursable cost of the project during 2011. GCI expects cash capital expenditures to total approximately $135 million for 2012.

GCI will hold a conference call to discuss the quarter’s results on Thursday, March 8, 2012 beginning at 2 p.m. (Eastern). To access the briefing on March 8, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-324-0798 (International callers should dial 1-212-519-0809) and identify your call as “GCI.” In addition to the conference call, GCI will make available net conferencing. To access the call via net conference, log on to www.gci.com and follow the instructions. A replay of the call will be available for 72-hours by dialing 800-839-5568, access code 7461 (International callers should dial 203-369-3122.)

GCI is the largest telecommunications company in Alaska. GCI’s cable plant, which provides voice, video, and broadband data services, passes 80 percent of Alaska households. GCI operates Alaska’s most extensive terrestrial/subsea fiber optic network which connects not only Anchorage but also Fairbanks and Juneau/Southeast Alaska to the lower 48 states with a diversely routed, protected fiber network. GCI’s satellite network provides communications services to small towns and communities throughout rural Alaska. GCI’s newly constructed statewide mobile wireless network seamlessly links urban and rural Alaska for the first time in the state’s history.

A pioneer in bundled services, GCI is the top provider of voice, data, and video services to Alaska consumers with a 70 percent share of the consumer broadband market. GCI is also the leading provider of communications services to enterprise customers, particularly large enterprise customers with complex data networking needs. More information about GCI can be found at www.gci.com.

The foregoing contains forward-looking statements regarding GCI’s expected results that are based on management’s expectations as well as on a number of assumptions concerning future events. Actual results might differ materially from those projected in the forward looking statements due to uncertainties and other factors, many of which are outside GCI’s control. Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements is contained in GCI’s cautionary statement sections of Form 10-K and 10-Q filed with the Securities and Exchange Commission.


#    #    #

 
 
 
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
            
CONSOLIDATED BALANCE SHEETS
            
(Unaudited)
            
             
             
             
(Amounts in thousands)
            
   
December 31,
    
December 31,
  
Assets
  
2011
    
2010
  
             
Current assets:
            
  Cash and cash equivalents
   $ 29,387       33,070  
 
                
  Receivables
     141,827       132,856  
  Less allowance for doubtful receivables
     5,796       9,189  
     Net receivables
     136,031       123,667  
 
                
  Deferred income taxes
     15,555       10,145  
  Prepaid expenses
     7,899       5,950  
  Inventories
     7,522       5,804  
  Other current assets
     3,631       3,940  
       Total current assets
     200,025       182,576  
 
                
Property and equipment in service, net of depreciation
     851,705       798,278  
Construction in progress
     42,918       31,144  
       Net property and equipment
     894,623       829,422  
 
                
Cable certificates
     191,635       191,635  
Goodwill
     74,883       73,932  
Wireless licenses
     25,967       25,967  
Restricted cash
     15,910       -  
Other intangible assets, net of amortization
     15,835       17,717  
Deferred loan and senior notes costs, net of amortization
     12,812       13,661  
Other assets
     17,214       16,850  
    Total other assets
     354,256       339,762  
       Total assets
   $ 1,448,904       1,351,760  
                 
           
(Continued)
  

 
 
 
GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
            
CONSOLIDATED BALANCE SHEETS
            
(Unaudited)
            
(Continued)
            
             
             
(Amounts in thousands)
            
   
December 31,
    
December 31,
  
Liabilities and Stockholders' Equity
  
2011
    
2010
  
             
Current liabilities:
            
  Current maturities of obligations under long-term debt and capital leases
   $ 8,797       7,652  
  Accounts payable
     41,353       35,589  
  Deferred revenue
     22,003       17,296  
  Accrued payroll and payroll related obligations
     22,126       22,132  
  Accrued interest
     6,680       13,456  
  Accrued liabilities
     11,423       12,557  
  Subscriber deposits
     1,250       1,271  
     Total current liabilities
     113,632       109,953  
 
                
Long-term debt, net
     858,031       779,201  
Obligations under capital leases, excluding current maturities
     78,605       84,144  
Obligation under capital lease due to related party
     1,893       1,885  
Deferred income taxes
     115,296       102,401  
Long-term deferred revenue
     81,822       49,175  
Other liabilities
     24,456       24,495  
       Total liabilities
     1,273,735       1,151,254  
 
                
                 
Commitments and contingencies
                
Stockholders’ equity:
                
  Common stock (no par):
                
   Class A. Authorized 100,000 shares; issued 39,296 and 44,213 shares at
      December 31, 2011 and 2010, respectively; outstanding 39,043 and
      43,958 shares at December 31, 2011 and 2010, respectively
     26,179       69,396  
                 
    Class B. Authorized 10,000 shares; issued and outstanding 3,171 and
      3,178 shares at December 31, 2011 and 2010, respectively; convertible
      on a share-per-share basis into Class A common stock
     2,679       2,677  
                 
    Less cost of 253 and 255 Class A common shares held in
      treasury at December 31, 2011 and 2010, respectively
     (2,225 )     (2,249 )
 
                
  Paid-in capital
     32,795       37,075  
  Retained earnings
     99,433       93,607  
       Total General Communication, Inc. stockholders' equity
     158,861       200,506  
  Non-controlling interest
     16,308       -  
       Total stockholders' equity
     175,169       200,506  
                 
       Total liabilities and stockholders' equity
   $ 1,448,904       1,351,760  

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
                  
CONSOLIDATED STATEMENTS OF OPERATIONS
                  
YEARS ENDED DECEMBER 31, 2011, 2010 AND 2009
(Unaudited)
                  
                   
   
 
              
(Amounts in thousands, except per share amounts)
  
2011
    
2010
    
2009
  
                   
Revenues
   $ 679,381       651,250       595,811  
 
                        
Cost of goods sold (exclusive of depreciation and amortization shown
  separately below)
     227,399       207,817       193,676  
Selling, general and administrative expenses
     235,521       228,808       212,671  
Depreciation and amortization expense
     125,742       126,114       123,362  
   Operating income
     90,719       88,511       66,102  
 
                        
Other income (expense):
                        
  Interest expense (including amortization and write-off of deferred loan fees)
     (68,258 )     (70,329 )     (58,761 )
  Loss on extinguishment of debt
     (9,111 )     -       -  
  Interest income
     33       261       111  
  Other
     (297 )     -       -  
   Other expense, net
     (77,633 )     (70,068 )     (58,650 )
                         
   Income before income tax expense
     13,086       18,443       7,452  
 
                        
Income tax expense
     7,485       9,488       3,936  
 
                        
   Net income
     5,601       8,955       3,516  
                         
Net loss attributable to the non-controlling interest
     238       -       -  
                         
   Net income attributable to General Communication, Inc.
   $ 5,839       8,955       3,516  
 
                        
Basic net income attributable to General Communication, Inc.
  common stockholders per Class A common share
   $ 0.13       0.17       0.07  
Basic net income attributable to General Communication, Inc.
  common stockholders per Class B common share
   $ 0.13       0.17       0.07  
Diluted net income attributable to General Communication, Inc.
  common stockholders per Class A common share
   $ 0.12       0.17       0.06  
Diluted net income attributable to General Communication, Inc.
  common stockholders per Class B common share
   $ 0.12       0.17       0.06  
Common shares used to calculate Class A basic EPS
     42,175       50,076       50,159  
                         
Common shares used to calculate Class A diluted EPS
     45,889       53,426       53,848  

 

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
  
(Amounts in thousands)
                                                                    
   
Fourth Quarter 2011
    
Fourth Quarter 2010
  
         
Network
          
Managed
    
 Regulated
          
Network
          
Managed
    
 Regulated
  
   
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
    
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 11,511       5,429       6,662       -       5,044       28,646     $ 13,606       6,561       7,404       -       5,443       33,014  
  Video
     29,595       -       2,999       -       -       32,594       30,379       -       3,269       -       -       33,648  
  Data
     19,931       15,321       22,308       17,207       -       74,767       16,833       15,134       20,279       13,942       -       66,188  
  Wireless
     25,299       4,991       2,515       -       -       32,805       25,850       4,033       2,263       -       -       32,146  
    Total
     86,336       25,741       34,484       17,207       5,044       168,812       86,668       25,728       33,215       13,942       5,443       164,996  
                                                                                                 
Cost of goods sold
     27,938       5,972       16,140       3,987       1,628       55,665       27,282       6,576       15,686       4,089       1,037       54,670  
                                                                                                 
    Contribution
     58,398       19,769       18,344       13,220       3,416       113,147       59,386       19,152       17,529       9,853       4,406       110,326  
                                                                                                 
Less SG&A
     36,550       8,189       10,959       5,234       3,546       64,478       34,271       9,649       10,559       4,683       3,153       62,315  
Less Other expense
     -       -       -       205       -       205       -       -       -       -       -       -  
    EBITDA
     21,848       11,580       7,385       7,781       (130 )     48,464       25,115       9,503       6,970       5,170       1,253       48,011  
                                                                                                 
Add share-based
  compensation
     1,769       646       630       335       16       3,396       1,032       479       332       191       3       2,037  
Add accretion
     93       30       27       13       -       163       149       71       43       26       -       289  
Add loss from
   noncontrolling interest
     -       -       -       238       -       238       -       -       -       -       -       -  
    Adjusted EBITDA
   $ 23,710       12,256       8,042       8,367       (114 )     52,261     $ 26,296       10,053       7,345       5,387       1,256       50,337  


 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
(Amounts in thousands)
                                                                    
   
Fourth Quarter 2011
    
Third Quarter 2011
         
Network
          
Managed
    
 Regulated
          
Network
          
Managed
    
 Regulated
  
   
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
    
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 11,511       5,429       6,662       -       5,044       28,646     $ 13,164       6,213       7,137       -       5,990       32,504  
  Video
     29,595       -       2,999       -       -       32,594       29,155       -       2,830       -       -       31,985  
  Data
     19,931       15,321       22,308       17,207       -       74,767       18,088       17,140       23,040       17,407       -       75,675  
  Wireless
     25,299       4,991       2,515       -       -       32,805       28,860       6,114       2,565       -       -       37,539  
    Total
     86,336       25,741       34,484       17,207       5,044       168,812       89,267       29,467       35,572       17,407       5,990       177,703  
                                                                                                 
Cost of goods sold
     27,938       5,972       16,140       3,987       1,628       55,665       27,436       9,531       17,232       4,540       1,925       60,664  
                                                                                                 
    Contribution
     58,398       19,769       18,344       13,220       3,416       113,147       61,831       19,936       18,340       12,867       4,065       117,039  
                                                                                                 
Less SG&A
     36,550       8,189       10,959       5,234       3,546       64,478       31,737       6,300       9,358       4,031       3,027       54,453  
Less Other expense
     -       -       -       205       -       205       -       -       -       59       -       59  
    EBITDA
     21,848       11,580       7,385       7,781       (130 )     48,464       30,094       13,636       8,982       8,777       1,038       62,527  
                                                                                                 
Add share-based
  compensation
     1,769       646       630       335       16       3,396       173       56       104       51       -       384  
Add accretion
     93       30       27       13       -       163       106       37       31       16       -       190  
Add loss from
   noncontrolling interest
     -       -       -       238       -       238       -       -       -       -       -       -  
    Adjusted EBITDA
   $ 23,710       12,256       8,042       8,367       (114 )     52,261     $ 30,373       13,729       9,117       8,844       1,038       63,101  

 

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULES
(Unaudited)
(Amounts in thousands)
                                                                    
   
Twelve Months Ended December 31, 2011
    
Twelve Months Ended December 31, 2010
  
         
Network
          
Managed
    
 Regulated
          
Network
          
Managed
    
 Regulated
  
   
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
    
Consumer
    
Access
    
Commercial
    
Broadband
    
Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 52,052       23,553       28,712       -       22,002       126,319     $ 57,317       29,032       31,720       -       22,705       140,774  
  Video
     118,635       -       11,605       -       -       130,240       118,475       -       11,178       -       -       129,653  
  Data
     71,977       62,456       85,961       63,248       -       283,642       61,364       61,494       76,823       49,962       -       249,643  
  Wireless
     109,910       19,447       9,823       -       -       139,180       105,742       16,701       8,737       -       -       131,180  
    Total
     352,574       105,456       136,101       63,248       22,002       679,381       342,898       107,227       128,458       49,962       22,705       651,250  
                                                                                                 
Cost of goods sold
     110,693       28,744       65,170       17,021       5,771       227,399       104,481       25,030       59,885       14,012       4,409       207,817  
                                                                                                 
    Contribution
     241,881       76,712       70,931       46,227       16,231       451,982       238,417       82,197       68,573       35,950       18,296       443,433  
                                                                                                 
Less SG&A
     134,951       27,837       41,085       18,246       13,402       235,521       127,130       33,566       38,838       17,338       11,936       228,808  
Less Other expense
     -       -       -       297       -       297       -       -       -       -       -       -  
    EBITDA
     106,930       48,875       29,846       27,684       2,829       216,164       111,287       48,631       29,735       18,612       6,360       214,625  
                                                                                                 
Add share-based
  compensation
     3,457       1,214       1,276       657       16       6,620       3,361       1,598       1,117       651       6       6,733  
Add accretion
     347       120       100       52       -       619       149       71       43       26       -       289  
Add loss from
   noncontrolling interest
     -       -       -       238       -       238       -       -       -       -       -       -  
Add non-cash
  contribution adjustment
     -       -       -       -       -       -       (81 )     (41 )     (24 )     (14 )     -       (160 )
    Adjusted EBITDA
   $ 110,734       50,209       31,222       28,631       2,845       223,641     $ 114,716       50,259       30,871       19,275       6,366       221,487  


 


 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
  
KEY PERFORMANCE INDICATORS
  
(Unaudited)
  
                                           
                                           
                     
December 31, 2011
    
December 31, 2011
  
                     
as Compared to
    
as Compared to
  
   
December 31,
  
December 31,
  
September 30,
    
December 31,
    
September 30,
  
December 31,
  
September 30,
  
   
2011
    
2010
    
2011
    
2010
    
2011
    
2010
    
2011
  
Consumer
                                          
Voice
                                          
Long-distance subscribers
     79,500       88,200       81,700       (8,700 )     (2,200 )     -9.9 %     -2.7 %
Total local access lines in service
     77,600       84,800       79,100       (7,200 )     (1,500 )     -8.5 %     -1.9 %
Local access lines in service on GCI facilities
     72,000       77,400       73,200       (5,400 )     (1,200 )     -7.0 %     -1.6 %
                                                         
Video
                                                        
Basic subscribers
     125,000       130,000       126,400       (5,000 )     (1,400 )     -3.8 %     -1.1 %
Digital programming tier subscribers
     75,600       81,800       76,700       (6,200 )     (1,100 )     -7.6 %     -1.4 %
HD/DVR converter boxes
     89,400       88,100       87,400       1,300       2,000       1.5 %     2.3 %
Homes passed
     242,100       238,500       239,800       3,600       2,300       1.5 %     1.0 %
                                                         
Data
                                                        
Cable modem subscribers
     108,300       105,700       106,800       2,600       1,500       2.5 %     1.4 %
                                                         
Wireless
                                                        
Wireless lines in service
     124,600       124,900       125,800       (300 )     (1,200 )     -0.2 %     -1.0 %
                                                         
Network Access Services
                                                  
Data:
                                                        
Total ISP access lines in service
     1,700       1,700       1,600       -       100       0.0 %     6.3 %
Total ISP access lines in service on GCI facilities
     1,400       1,300       1,400       100       -       7.7 %     0.0 %
                                                         
Commercial
                                                        
Voice:
                                                        
Long-distance subscribers
     8,300       9,100       8,600       (800 )     (300 )     -8.8 %     -3.5 %
Total local access lines in service
     49,700       48,300       49,200       1,400       500       2.9 %     1.0 %
Local access lines in service on GCI facilities
     27,300       21,200       25,800       6,100       1,500       28.8 %     5.8 %
                                                         
Video
                                                        
Hotels and mini-headend
  subscribers
     15,700       15,300       18,000       400       (2,300 )     2.6 %     -12.8 %
Basic subscribers
     1,900       1,800       2,000       100       (100 )     5.6 %     -5.0 %
   Total basic subscribers
     17,600       17,100       20,000       500       (2,400 )     2.9 %     -12.0 %
                                                         
Data
                                                        
Cable modem subscribers
     11,100       10,700       11,100       400       -       3.7 %     0.0 %
                                                         
Wireless
                                                        
Wireless lines in service
     15,300       13,800       14,900       1,500       400       10.9 %     2.7 %
                                                         
Regulated Operations
                                                        
Voice:
                                                        
Total local access lines in service
     9,100       10,000       9,300       (900 )     (200 )     -9.0 %     -2.2 %
                                                         
                                                         
                           
December 31, 2011
  
December 31, 2011
   
Three Months Ended
            
as Compared to
  
as Compared to
   
December 31,
  
December 31,
  
September 30,
    
December 31,
    
September 30,
  
December 31,
  
September 30,
  
     2011    2010    2011    2010    2011    2010    2011
Consumer
                                                        
Voice
                                                        
Long-distance minutes carried (in millions)
     24.7       26.2       22.3       (1.5 )     2.4       -5.7 %     10.8 %
                                                         
Video
                                                        
Average monthly gross revenue per subscriber
   $ 78.51     $ 77.77     $ 76.85     $ 0.74     $ 1.66       1.0 %     2.2 %
                                                         
Wireless
                                                        
Average monthly gross revenue per subscriber
   $ 61.40     $ 64.88     $ 72.60     $ (3.48 )   $ (11.20 )     -5.4 %     -15.4 %
                                                         
Network Access Services
                                                  
Voice
                                                        
Long-distance minutes carried (in millions)
     179.6       185.0       202.5       (5.4 )     (22.9 )     -2.9 %     -11.3 %
                                                         
Commercial
                                                        
Voice:
                                                        
Long-distance minutes carried (in millions)
     27.0       27.3       28.4       (0.3 )     (1.4 )     -1.1 %     -4.9 %
                                                         
Total
                                                        
Long-distance minutes carried (in millions)
     231.3       238.5       253.2       (7.2 )     (21.9 )     -3.0 %     -8.6 %


               
December 31, 2011
    
December 31, 2011
  
   
Twelve Months Ended
    
as Compared to
    
as Compared to
  
   
December 31,
    
December 31,
    
December 31,
    
December 31,
  
   
2011
    
2010
    
2010
    
2010
  
Consumer
                        
Voice
                        
Long-distance minutes carried (in millions)
     94.7       106.9       (12.2)       -11.4%  
                                 
Network Access Services
                          
Voice
                                
Long-distance minutes carried (in millions)
     760.5       785.4       (24.9)       -3.2%  
                                 
Commercial
                                
Voice:
                                
Long-distance minutes carried (in millions)
     111.8       116.0       (4.2)       -3.6%  
                                 
Total
                                
Long-distance minutes carried (in millions)
     967.0       1,008.3       (41.3)       -4.1%  



 
 
 

General Communication, Inc.
                  
Non-GAAP Financial Reconciliation Schedule
                  
(Unaudited, Amounts in Millions)
                  
                   
                   
   
Three Months Ended
  
   
December 31,
    
December 31,
    
September 30,
  
   
2011
    
2010
    
2011
  
Net income (loss)
   $ (1.1 )     (2.2 )     7.2  
Income tax expense (benefit)
     (0.0 )     (0.8 )     8.0  
Income (loss) before income tax expense (benefit)
     (1.1 )     (3.0 )     15.2  
                         
Other expense:
                        
Interest expense (including amortization and write-off of deferred loan fees)
     16.9       17.1       16.7  
Other
     0.2       -       -  
Other expense, net
     17.1       17.1       16.7  
                         
Operating income
     16.0       14.1       31.9  
Depreciation and amortization expense
     32.7       33.9       30.7  
Equity investment
     (0.2 )     -       -  
                         
EBITDA (Note 2)
     48.5       48.0       62.6  
Share-based compensation
     3.4       2.0       0.4  
Accretion
     0.2       0.3       0.1  
Non-controlling interest
     0.2       -       -  
Adjusted EBITDA (Note 1)
   $ 52.3       50.3       63.1  

 
 
 

General Communication, Inc.
          
Non-GAAP Financial Reconciliation Schedule
    
(Unaudited, Amounts in Millions)
          
           
           
      Year Ended
       December 31,
 
December 31,
     
2011
  
2010
Net income
  
$
                  5.6
  
                  9.0
Income tax expense
    
                  7.5
  
                  9.4
Income before income tax expense
  
                13.1
  
                18.4
           
Other expense:
          
Interest expense (including  amortization and write-off of deferred  loan fees)
                68.3
  
                70.3
Interest income
    
                   -
  
                 (0.2)
Loss on extinguishment of debt
    
                  9.1
  
                   -
Other
    
                  0.2
  
                   -
Other expense, net
    
                77.6
  
                70.1
           
Operating income
    
                90.7
  
                88.5
Depreciation and amortization expense
              125.7
  
              126.1
Equity investment
    
                 (0.2)
  
                   -
           
EBITDA (Note 2)
    
              216.2
  
              214.6
Share-based compensation
    
                  6.6
  
                  6.7
Accretion
    
                  0.6
  
                  0.3
Non-controlling interest
    
                  0.2
  
                   -
Non-cash contribution adjustment
    
                   -
  
                 (0.1)
Adjusted EBITDA (Note 1)
  
$
              223.6
  
              221.5
           
           
           
           
Notes:
          
(1) EBITDA (as defined in Note 2 below) before deducting share-based compensation,
accretion expense, loss attributable to non-controlling interest and non-cash
contribution adjustment.
          
           
(2) Earnings Before Interest, Taxes, Depreciation and Amortization is the sum of Net
Income, Interest Expense (including Amortization of Deferred Loan Fees), Interest
Income, Income Tax Expense, and Depreciation and Amortization Expense.
EBITDA is not presented as an alternative measure of net income, operating
income or cash flow from operations, as determined in accordance with accounting
principles generally accepted in the United States of America. GCI's management
uses EBITDA to evaluate the operating performance of its business, and as a
measure of performance for incentive compensation purposes. GCI believes
EBITDA is a measure used as an analytical indicator of income generated to service
debt and fund capital expenditures. In addition, multiples of current or projected
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.