Exhibit 99.1
 


March 6, 2013

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 2012 FINANCIAL RESULTS

·  
Consolidated revenue of $710.2 million
·  
Adjusted EBITDA of $226.8 million
·  
Net income of $9.7 million or $0.23 per diluted share

ANCHORAGE, AK – General Communication, Inc. (“GCI”) (NASDAQ:GNCMA) today reported its 2012 results with revenues increasing to $710.2 million over revenues of $679.4 million in 2011, an increase of $30.8 million or 4.5 percent. Adjusted EBITDA of $226.8 million increased $3.2 million or 1.4 percent over 2011 EBITDA of $223.6 million. Adjusted EBITDA for the year 2012 was offset by $3.0 million of expenses related to the Alaska Wireless Network (“AWN”) transaction.

Net income for 2012 totaled $9.7 million or earnings per diluted share of $0.23, an increase over net income of $5.7 million or earnings per diluted share of $0.12 for 2011.

For the fourth quarter of 2012, revenues totaled $183.7 million, an increase of $14.9 million or 8.8 percent over revenues of $168.8 million in the fourth quarter of 2011. Revenues were up $5.2 million or 2.9 percent sequentially when compared to third quarter 2012 revenues of $178.5 million. Adjusted EBITDA for the fourth quarter of 2012 was $53.1 million, an increase of $0.8 million or 1.6 percent over the fourth quarter of 2011 and a decrease of 10.7 percent from the third quarter of 2012. The sequential decrease in EBITDA was primarily due to an increase in COGS and selling, general and administrative costs.
 
“GCI’s results for 2012 were mostly on track with our expectations,” said Ron Duncan, GCI president. “Consumer Internet and managed broadband both had very strong years and we launched the iPhone to very a very positive customer response, although at a high handset cost.”

           “We incurred $3 million in AWN related transaction costs for the year. While we will incur more costs in 2013, the larger pre closing expense items are behind us. We continue planning for the AWN closing and the integration of GCI’s and Alaska Communications’ wireless networks. We look forward to announcing the achievement of this milestone following completion of the required regulatory approvals.”
 
GCI previously provided guidance on revenues of $690 million to $720 million and adjusted EBITDA of $230 million to $240 million for the year 2012, excluding expenses related to the Alaska Wireless Network (“AWN”) transaction. GCI’s revenue and EBITDA results for 2012 finished in the middle of the revenue range and slightly below the low end of the EBITDA range, excluding the $3.0 million in expenses related to the AWN transaction.

The AWN transaction is expected to close during the second quarter of 2013. The timing of such closing during the quarter will impact GCI’s 2013 results. GCI will issue guidance on consolidated revenues, EBITDA and AWN’s expected preferred distributions for 2013 after the AWN transaction has been approved and completed.
 
Highlights
·  
Managed Broadband revenues for 2012 totaled $86.6 million, an increase of $23.3 million or 36.9 percent over 2011, primarily as a result of sales of broadband service on GCI’s TERRA-Southwest terrestrial network. This was the first full year of revenues following GCI’s significant investment in rural terrestrial network expansion.

·  
GCI had 128,900 consumer and commercial cable modem customers at the end of 2012, an increase of 9,500 over the end of 2011. Fourth quarter cable modem customers increased by 4,200 over 124,700 customers at the end of the third quarter 2012. Average monthly revenue per cable modem for the fourth quarter of 2012 was $72.16, an increase of $11.84 over $60.32 posted for the prior year and $9.31 over $62.85 reported for the third quarter of 2012.

·  
GCI entered into a third arrangement under the New Markets Tax Credit (NMTC) program to help fund Phase 3 of our TERRA-Northwest project. Phase 3 of our TERRA-NW project continues the extension of terrestrial broadband service to Kotzebue. The NMTC program was established in the Community Renewal Tax Relief Act of 2000 to induce capital investment in qualified low-income communities.

Consumer
Consumer revenues of $353.0 million for the year 2012 were steady as compared to 2011. An increase in data revenue offset the decreases in voice and video revenues. Fourth quarter 2012 revenues of $89.9 million increased $3.6 million over fourth quarter 2011 revenues of $86.3 million and increased $3.1 million sequentially. In the fourth quarter of 2012, growth in data and wireless revenues were offset mostly by the expected decrease in voice revenue when compared to the fourth quarter of 2011 and the third quarter of 2012.

Consumer voice revenues of $41.4 million decreased $10.6 million when compared to 2011 as customers continue to abandon wireline service and shift to wireless. Consumer local access lines in service at the end of 2012 totaled 69,700, a decrease of 7,900 lines from the end of 2011. USF high cost support for wired consumer voice services decreased $2.2 million from the prior year.

Fourth quarter 2012 consumer voice revenues of $9.7 million decreased $1.8 million from the fourth quarter of 2011 and $0.3 million sequentially. Total access lines decreased 2,200 lines sequentially.

Consumer video revenues of $115.3 million decreased $3.3 million or 2.8 percent from 2011. Fourth quarter 2012 video revenues of $28.7 million decreased by $0.9 million from the prior year and were steady on a sequential basis. The decrease is primarily due to a decline in basic video subscribers. Consumer basic video subscribers totaled 122,300 at the end of 2012, a decrease of 2,700 subscribers from 2011 and an increase of 100 subscribers over the third quarter of 2012. GCI has had a steady increase in the number of customers who subscribe only to cable modem service. Presumably these access-only customers are purchasing video programming from other sources including over-the-top providers such as Netflix and Hulu.

Consumer data revenues of $86.5 million increased $14.5 million or 20.1 percent over 2011. Fourth quarter 2012 data revenues of $23.1 million increased 16.0 percent over the prior year and 8.1 percent sequentially. The increase in consumer data revenues for the year and for the fourth quarter of 2012 is due to an increase in cable modem customers and increasing monthly usage. GCI added 7,300 consumer cable modem customers over 2011 and cable modem customer counts increased by 2,500 on a sequential basis. GCI had 115,600 consumer cable modem customers at the end of 2012 representing 94.5 percent of basic video subscribers. GCI projects consumer cable modem subscribers could exceed total consumer basic video subscribers by the end of 2013.

Consumer wireless revenues of $109.8 million for 2012 were steady with the prior year. Fourth quarter 2012 wireless revenues of $28.4 million increased $3.1 million or 12.2 percent over 2011 and $1.3 million or 4.9 percent sequentially. The increase was primarily due to an increase in plan revenue. GCI served 123,000 consumer wireless subscribers at the end of 2012. USF high cost support for consumer wireless services decreased $3.4 million from the prior year.

Consumer served 90,600 postpaid and pre-paid non-Lifeline wireless subscribers at the end of 2012, an increase of 8,400 over the end of the prior year and an increase of 3,300 wireless customers sequentially. Post paid subscribers increased 7,200 year over year and 5,900 sequentially. Prepaid subscribers increased 700 over the prior year and decreased by 2,300 customers sequentially. The sequential decrease in prepaid subscribers is seasonal.

 GCI served 32,400 Lifeline customers at the end of 2012. In compliance with FCC Lifeline program reforms, GCI was required to recertify all Lifeline subscribers, enrolled as of June 1, 2012, by the end of 2012, with current subscribers to be recertified annually thereafter. The FCC recertification process contributed to a decrease of 10,000 Lifeline subscribers in 2012 and a decrease in Lifeline subsidy support revenues of $2.7 million. Lifeline subscribers declined by 3,100 on a sequential basis. Lifeline subscriber counts could decline further as a result of the annual recertification process or future program changes.

Network Access
Network access revenues of $105.4 million were steady with the prior year. Fourth quarter revenues of $26.8 million increased $1.0 million or 4.0 percent compared to 2011 and decreased $0.7 million or 2.6 percent on a sequential basis.

Voice revenues for 2012 decreased $1.1 million to $22.5 million from the prior year. The continued decrease in wireline voice revenues was expected and is primarily due to wireless and data substitution. Long distance minutes in 2012 decreased 2.0 percent from the prior year.
 
Data revenues were down $6.3 million when compared to $62.5 million in 2011. Fourth quarter 2012 data revenues decreased $1.0 million to $14.3 million from the prior year and were up slightly on a sequential basis. The decrease in data revenue when compared to the prior year on an annual and quarterly basis is primarily attributable to a decrease in special project revenue and rate compression.

Wireless revenues, primarily related to roaming traffic, increased $7.3 million to $26.8 million, an increase of 37.6 percent over the prior year. Fourth quarter revenues of $7.1 million increased $2.1 million or 42.8 percent over the prior year and decreased $0.6 million or 7.7 percent on a sequential basis. The decrease in quarterly sequential revenues is due to seasonality.

Commercial
Commercial revenues of $143.6 million increased $7.5 million or 5.5 percent over the prior year. Fourth quarter 2012 revenues of $38.6 million increased 11.8 percent over the fourth quarter of the prior year and 6.5 percent on a sequential basis.

Commercial data service revenues were $93.4 million in 2012, an increase of 8.7 percent over 2011. Fourth quarter 2012 revenues were $26.1 million, an increase of $3.8 million or 16.8 percent over the prior year quarter and a $2.4 million or 10.3 percent increase on a sequential basis. Commercial data service revenues include both transport charges for data circuits, professional services which are time and materials charges for GCI on-site support of customer operations and data center revenues. As summarized in the table below, data transport charges of $47.6 million increased by $3.2 million as compared to 2011, time and material charges for support activities increased by $3.4 million to $44.9 million and data center revenues increased by $0.8 million over 2011.

Millions $
  
2012
    
2011
       Q4 2012       Q4 2011  
Data Transport Charges
   $ 47.6     $ 44.4     $ 12.0     $ 11.4  
Professional Services
     44.9       41.5       13.8       10.8  
Data Center Revenues
     0.9       0.1       0.3       0.1  
Total Data Revenues
   $ 93.4     $ 86.0     $ 26.1     $ 22.3  

Commercial wireless revenues totaled $9.9 million for 2012 and were steady with the prior year. Fourth quarter 2012 revenues of $2.6 million were steady with the prior year quarter and on a sequential basis. GCI had 17,000 commercial wireless subscribers at the end of 2012, an increase of 1,700 subscribers over the prior year and an increase of 400 subscribers on a sequential basis.
 
Managed Broadband
Managed broadband revenues totaled $86.6 million in 2012, an increase of $23.3 million or 36.9 percent over the prior year. Fourth quarter 2012 revenue of $23.1 million increased $5.9 million or 34.4 percent over the prior year and $0.5 million or 2.0 percent sequentially. The strong revenue growth is primarily due to an increase in broadband capacity utilized on the TERRA Southwest terrestrial network. This was the first full year of revenues following GCI’s significant investment in rural network expansion.

Regulated Operations
Regulated operations revenues totaled $21.6 million in 2012, a decrease of $0.4 million from the prior year. Regulated operations revenues of $5.4 million for the fourth quarter of 2012 increased $0.3 million over the fourth quarter of 2011 and were steady with the third quarter of 2012. Regulated operations had 8,300 local access lines at the end of 2012, a decrease of 800 access lines from 2011 and a decrease of 200 access lines on a sequential basis.

Other Items
SG&A expenses for 2012 totaled $243.2 million, an increase of 3.3 percent as compared to $235.5 million for 2011. The increase is due to labor and related benefits and transaction costs related to AWN. As a percentage of revenues, SG&A expenses decreased to 34.3 percent in 2012 as compared to 34.7 percent in the prior year.

GCI’s 2012 capital expenditures totaled $165.7 million as compared to $186.4 million in 2011. Cash capital expenditures total $146.0 million for 2012 and compare to 177.1 million in 2011. GCI’s total capital expenditures for 2012 includes $20.2 million related to the TERRA-Northwest project all of which was funded with proceeds from our NMTC transactions and a grant from the Regulatory Commission of Alaska. GCI expects cash capital expenditures to total approximately $150 million for 2013, exclusive of the developing TV broadcast investment plan.

GCI will hold a conference call to discuss the quarter’s results on Thursday, March 7, 2013 beginning at 2 p.m. (Eastern). To access the briefing on March 7, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-942-9042 (International callers should dial 1-415-228-4668) 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 866-485-4168, access code 7461 (International callers should dial 1-203-369-1620.)

GCI is the largest telecommunications company in Alaska. GCI’s cable plant, which provides voice, video, and broadband data services, passes 78 percent of Alaska households. GCI operates Alaska’s most extensive terrestrial/subsea fiber optic network which connects not only Anchorage but also Fairbanks and Juneau/Southeast Alaska to the lower 48 states with a diversely routed, protected fiber network. GCI’s TERRA-Southwest fiber/microwave system links 65 communities in the Bristol Bay and Yukon-Kuskokwim Delta to Anchorage bringing terrestrial broadband Internet access to the region for the first time. GCI’s satellite network provides communications services to small towns and communities throughout rural Alaska. GCI’s statewide mobile wireless network seamlessly links urban and rural Alaska.

           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 Forms 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
  
2012
    
2011
  
             
Current assets:
            
  Cash and cash equivalents
   $ 24,491       29,387  
 
                
  Receivables
     150,436       141,827  
  Less allowance for doubtful receivables
     3,215       5,796  
     Net receivables
     147,221       136,031  
 
                
  Deferred income taxes
     12,897       15,555  
  Prepaid expenses
     8,441       7,899  
  Inventories
     12,098       7,522  
  Other current assets
     1,678       3,631  
       Total current assets
     206,826       200,025  
 
                
Property and equipment in service, net of depreciation
     838,247       849,121  
Construction in progress
     94,418       42,918  
       Net property and equipment
     932,665       892,039  
 
                
Cable certificates
     191,635       191,635  
Goodwill
     77,294       74,883  
Wireless licenses
     25,967       25,967  
Restricted cash
     30,933       15,910  
Other intangible assets, net of amortization
     16,560       15,835  
Deferred loan and senior notes costs, net of amortization
     11,189       12,812  
Other assets
     13,453       17,214  
    Total other assets
     367,031       354,256  
       Total assets
   $ 1,506,522       1,446,320  
                 
           
(Continued)
  

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
            
CONSOLIDATED BALANCE SHEETS
            
(Unaudited)
            
(Continued)
            
             
             
(Amounts in thousands)
            
   
December 31,
    
December 31,
  
Liabilities and Stockholders' Equity
  
2012
    
2011
  
             
Current liabilities:
            
  Current maturities of obligations under long-term debt and capital leases
   $ 7,923       8,797  
  Accounts payable
     52,384       41,353  
  Deferred revenue
     25,218       22,003  
  Accrued payroll and payroll related obligations
     19,440       22,126  
  Accrued interest
     6,786       6,680  
  Accrued liabilities
     15,242       11,423  
  Subscriber deposits
     1,366       1,250  
     Total current liabilities
     128,359       113,632  
 
                
Long-term debt, net
     875,123       858,031  
Obligations under capital leases, excluding current maturities
     72,725       78,605  
Obligation under capital lease due to related party, excluding
 current maturity
     1,892       1,893  
Deferred income taxes
     123,661       114,234  
Long-term deferred revenue
     89,815       81,822  
Other liabilities
     25,511       24,456  
       Total liabilities
     1,317,086       1,272,673  
 
                
                 
Commitments and contingencies
                
Stockholders’ equity:
                
  Common stock (no par):
                
   Class A. Authorized 100,000 shares; issued 38,534 and 39,296 shares at
      December 31, 2012 and 2011, respectively; outstanding 38,357 and
      39,043 shares at December 31, 2012 and 2011, respectively
     22,703       26,179  
    Class B. Authorized 10,000 shares; issued and outstanding 3,169 and
      3,171 shares at December 31, 2012 and 2011, respectively; convertible
      on a share-per-share basis into Class A common stock
     2,676       2,679  
    Less cost of 177 and 253 Class A common shares held in
      treasury at December 31, 2012 and 2011, respectively
     (1,617 )     (2,225 )
  Paid-in capital
     25,832       32,795  
  Retained earnings
     107,584       97,911  
       Total General Communication, Inc. stockholders' equity
     157,178       157,339  
  Non-controlling interests
     32,258       16,308  
       Total stockholders' equity
     189,436       173,647  
                 
       Total liabilities and stockholders' equity
   $ 1,506,522       1,446,320  
 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
                  
CONSOLIDATED INCOME STATEMENTS
                  
YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010
                  
                   
   
(Unaudited)
              
(Amounts in thousands, except per share amounts)
  
2012
    
2011
    
2010
  
                   
Revenues
   $ 710,181     $ 679,381     $ 651,250  
 
                        
Cost of goods sold (exclusive of depreciation and amortization shown
  separately below)
     247,501       227,399       207,817  
Selling, general and administrative expenses
     243,248       235,521       228,808  
Depreciation and amortization expense
     130,452       125,937       126,699  
   Operating income
     88,980       90,524       87,926  
 
                        
Other income (expense):
                        
  Interest expense (including amortization of deferred loan fees)
     (67,747 )     (68,258 )     (70,329 )
  Loss on extinguishment of debt
     -       (9,111 )     -  
  Other
     17       (264 )     261  
   Other expense, net
     (67,730 )     (77,633 )     (70,068 )
                         
   Income before income tax expense
     21,250       12,891       17,858  
Income tax expense
     12,088       7,405       9,248  
 
                        
   Net income
     9,162       5,486       8,610  
Net loss attributable to the non-controlling interests
     511       238       -  
                         
   Net income attributable to General Communication, Inc.
   $ 9,673     $ 5,724     $ 8,610  
 
                        
Basic net income attributable to General Communication, Inc.
  common stockholders per Class A common share
   $ 0.23     $ 0.13     $ 0.16  
Basic net income attributable to General Communication, Inc.
  common stockholders per Class B common share
   $ 0.23     $ 0.13     $ 0.16  
Diluted net income attributable to General Communication, Inc.
  common stockholders per Class A common share
   $ 0.23     $ 0.12     $ 0.16  
Diluted net income attributable to General Communication, Inc.
  common stockholders per Class B common share
   $ 0.23     $ 0.12     $ 0.16  
Common shares used to calculate Class A basic EPS
     38,560       42,175       50,076  
Common shares used to calculate Class A diluted EPS
     42,119       45,889       53,426  

 
 
 


GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
  
SUPPLEMENTAL SCHEDULES
  
(Unaudited)
  
                                                                         
(Amounts in thousands)
                                                                    
   
Fourth Quarter 2012
    
Fourth Quarter 2011
  
   
Consumer
    
Network Access
    
Commercial
    
Managed Broadband
    
Regulated Operations
    
Totals
    
Consumer
    
Network Access
    
Commercial
    
Managed Broadband
    
Regulated Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 9,708       5,306       6,591       -       5,360       26,965     $ 11,511       5,429       6,662       -       5,044       28,646  
  Video
     28,656       -       3,343       -       -       31,999       29,595       -       2,999       -       -       32,594  
  Data
     23,115       14,336       26,058       23,131       -       86,640       19,931       15,321       22,308       17,207       -       74,767  
  Wireless
     28,379       7,125       2,568       -       -       38,072       25,299       4,991       2,515       -       -       32,805  
    Total
     89,858       26,767       38,560       23,131       5,360       183,676       86,336       25,741       34,484       17,207       5,044       168,812  
                                                                                                 
Cost of goods sold
     36,092       5,953       19,086       6,911       1,772       69,814       27,938       5,972       16,140       3,987       1,628       55,665  
                                                                                                 
    Contribution
     53,766       20,814       19,474       16,220       3,588       113,862       58,398       19,769       18,344       13,220       3,416       113,147  
                                                                                                 
Less SG&A
     35,146       6,903       10,709       6,319       2,913       61,990       36,550       8,189       10,959       5,234       3,546       64,478  
Less Other expense
     -       -       -       115       -       115       -       -       -       205       -       205  
    EBITDA
     18,620       13,911       8,765       9,786       675       51,757       21,848       11,580       7,385       7,781       (130 )     48,464  
                                                                                                 
Add share-based
  compensation
     539       158       228       117       8       1,050       1,769       646       630       335       16       3,396  
Add accretion
     (19 )     (6 )     (5 )     (3 )     -       (33 )     93       30       27       13       -       163  
Add loss from
   noncontrolling interests
     -       -       -       336       -       336       -       -       -       238       -       238  
    Adjusted EBITDA
   $ 19,140       14,063       8,988       10,236       683       53,110     $ 23,710       12,256       8,042       8,367       (114 )     52,261  

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
  
SUPPLEMENTAL SCHEDULES
  
(Unaudited)
  
                                                                         
(Amounts in thousands)
                                                                    
   
Fourth Quarter 2012
    
Third Quarter 2012
  
   
Consumer
    
Network Access
    
Commercial
    
Managed Broadband
    
Regulated Operations
    
Totals
    
Consumer
    
Network Access
    
Commercial
    
Managed Broadband
    
Regulated Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 9,708       5,306       6,591       -       5,360       26,965     $ 9,968       5,664       6,896       -       5,319       27,847  
  Video
     28,656       -       3,343       -       -       31,999       28,394       -       3,142       -       -       31,536  
  Data
     23,115       14,336       26,058       23,131       -       86,640       21,379       14,093       23,622       22,685       -       81,779  
  Wireless
     28,379       7,125       2,568       -       -       38,072       27,066       7,718       2,548       -       -       37,332  
    Total
     89,858       26,767       38,560       23,131       5,360       183,676       86,807       27,475       36,208       22,685       5,319       178,494  
                                                                                                 
Cost of goods sold
     36,092       5,953       19,086       6,911       1,772       69,814       33,027       6,194       16,607       5,230       1,696       62,754  
                                                                                                 
    Contribution
     53,766       20,814       19,474       16,220       3,588       113,862       53,780       21,281       19,601       17,455       3,623       115,740  
                                                                                                 
Less SG&A
     35,146       6,903       10,709       6,319       2,913       61,990       33,699       6,157       10,028       5,723       2,621       58,228  
Less Other expense
     -       -       -       115       -       115       -       -       -       (164 )     -       (164 )
    EBITDA
     18,620       13,911       8,765       9,786       675       51,757       20,081       15,124       9,573       11,896       1,002       57,676  
                                                                                                 
Add share-based
  compensation
     539       158       228       117       8       1,050       723       224       286       155       7       1,395  
Add accretion
     (19 )     (6 )     (5 )     (3 )     -       (33 )     112       35       33       21       -       201  
Add loss from
   noncontrolling interests
     -       -       -       336       -       336       -       -       -       177       -       177  
Add non-cash contribution
     -       -       -       -       -       -       -       -       -       -       -       -  
    Adjusted EBITDA
   $ 19,140       14,063       8,988       10,236       683       53,110     $ 20,916       15,383       9,892       12,249       1,009       59,449  

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
  
SUPPLEMENTAL SCHEDULES
  
(Unaudited)
  
                                                                         
(Amounts in thousands)
                                                                    
   
Twelve Months Ended December 31, 2012
    
Twelve Months Ended December 31, 2011
  
   
Consumer
    
Network Access
    
Commercial
    
Managed Broadband
    
Regulated Operations
    
Totals
    
Consumer
    
Network Access
    
Commercial
    
Managed Broadband
    
Regulated Operations
    
Totals
  
Revenues
                                                                        
  Voice
   $ 41,439       22,496       27,377       -       21,625       112,937     $ 52,052       23,553       28,712       -       22,002       126,319  
  Video
     115,307       -       12,841       -       -       128,148       118,635       -       11,605       -       -       130,240  
  Data
     86,466       56,194       93,434       86,562       -       322,656       71,977       62,456       85,961       63,248       -       283,642  
  Wireless
     109,760       26,757       9,923       -       -       146,440       109,910       19,447       9,823       -       -       139,180  
    Total
     352,972       105,447       143,575       86,562       21,625       710,181       352,574       105,456       136,101       63,248       22,002       679,381  
                                                                                                 
Cost of goods sold
     128,324       24,356       66,895       21,298       6,628       247,501       110,693       28,744       65,170       17,021       5,771       227,399  
                                                                                                 
    Contribution
     224,648       81,091       76,680       65,264       14,997       462,680       241,881       76,712       70,931       46,227       16,231       451,982  
                                                                                                 
Less SG&A
     139,191       26,841       42,014       24,087       11,115       243,248       134,951       27,837       41,085       18,246       13,402       235,521  
Less Other expense
     -       -       -       (2 )     -       (2 )     -       -       -       297       -       297  
    EBITDA
     85,457       54,250       34,666       41,179       3,882       219,434       106,930       48,875       29,846       27,684       2,829       216,164  
                                                                                                 
Add share-based
  compensation
     2,586       790       1,041       595       28       5,040       3,457       1,214       1,276       657       16       6,620  
Add accretion
     533       169       156       102       -       960       347       120       100       52       -       619  
Add loss from
   noncontrolling interests
     -       -       -       867       -       867       -       -       -       238       -       238  
Add non-cash
  contribution adjustment
     282       89       83       54       -       508       -       -       -       -       -       -  
    Adjusted EBITDA
   $ 88,858       55,298       35,946       42,797       3,910       226,809     $ 110,734       50,209       31,222       28,631       2,845       223,641  

 
 
 

GENERAL COMMUNICATION, INC. AND SUBSIDIARIES
  
KEY PERFORMANCE INDICATORS
  
(Unaudited)
  
                                           
                     
December 31, 2012
    
December 31, 2012
  
                     
as compared to
    
as compared to
  
   
December 31,
    
December 31,
    
September 30,
    
December 31,
    
September 30,
    
December 31,
    
September 30,
  
   
2012
    
2011
    
2012
    
2011
    
2012
    
2011
    
2012
  
Consumer
                                          
Voice
                                          
Local service lines in service
     69,700       77,600       71,900       (7,900 )     (2,200 )     -10.2 %     -3.1 %
Local access lines in service on GCI facilities
     64,900       72,000       66,900       (7,100 )     (2,000 )     -9.9 %     -3.0 %
                                                         
Video
                                                        
Basic subscribers
     122,300       125,000       122,200       (2,700 )     100       -2.2 %     0.1 %
Digital programming tier subscribers
     72,500       75,600       72,000       (3,100 )     500       -4.1 %     0.7 %
HD/DVR converter boxes
     90,400       89,400       89,200       1,000       1,200       1.1 %     1.3 %
Homes passed
     243,600       242,100       242,400       1,500       1,200       0.6 %     0.5 %
                                                         
Data
                                                        
Cable modem subscribers
     115,600       108,300       113,100       7,300       2,500       6.7 %     2.2 %
                                                         
Wireless
                                                        
Wireless Lifeline lines in service
     32,400       42,400       35,500       (10,000 )     (3,100 )     -23.6 %     -8.7 %
Wireless Postpaid lines in service
     81,600       73,900       76,000       7,700       5,600       10.4 %     7.4 %
Wireless Prepaid lines in service
     9,000       8,300       11,300       700       (2,300 )     8.4 %     -20.4 %
                                                         
Commercial
                                                        
Voice
                                                        
Total local access lines in service
     51,600       51,400       51,800       200       (200 )     0.4 %     -0.4 %
Local access lines in service on GCI facilities
     30,800       28,700       30,500       2,100       300       7.3 %     1.0 %
                                                         
Video
                                                        
Hotels and mini-headend
  subscribers
     15,800       15,700       18,500       100       (2,700 )     0.6 %     -14.6 %
Basic subscribers
     1,900       1,900       1,900       -       -       0.0 %     0.0 %
   Total basic subscribers
     17,700       17,600       20,400       100       (2,700 )     0.6 %     -13.2 %
                                                         
Data
                                                        
Cable modem subscribers
     13,300       11,100       11,600       2,200       1,700       19.8 %     14.7 %
                                                         
Wireless
                                                        
Wireless lines in service
     17,000       15,300       16,600       1,700       400       11.1 %     2.4 %
                                                         
Regulated Operations
                                                        
Voice:
                                                        
Total local access lines in service
     8,300       9,100       8,500       (800 )     (200 )     -8.8 %     -2.4 %
                                                         
                           
December 31, 2012
    
December 31, 2012
  
   
Three Months Ended
    
as Compared to
    
as Compared to
  
   
December 31,
    
December 31,
    
September 30,
    
December 31,
    
September 30,
    
December 31,
    
September 30,
  
      2012       2011       2012       2011       2012       2011       2012  
Consumer
                                                        
Video
                                                        
Average monthly revenue per
  subscriber
   $ 77.99     $ 78.51     $ 77.45     $ (0.52 )   $ 0.54       -0.7 %     0.7 %
                                                         
Wireless
                                                        
Average monthly revenue per
  subscriber
   $ 71.85     $ 61.40     $ 67.98     $ 10.45     $ 3.87       17.0 %     5.7 %
                                                         
Total
                                                        
Voice
                                                        
Long-distance minutes carried
  (in millions)
     227.2       231.3       243.0       (4.1 )     (15.8 )     -1.8 %     -6.5 %
                                                         
Data
                                                        
Average monthly revenue per
  cable modem subscriber
   $ 72.16     $ 60.32     $ 62.85     $ 11.84     $ 9.31       19.6 %     14.8 %

 
 
 

General Communication, Inc.
                  
Non-GAAP Financial Reconciliation Schedule
                  
(Unaudited, Amounts in Millions)
                  
                   
                   
   
Three Months Ended
  
   
December 31,
    
December 31,
    
September 30,
  
   
2012
    
2011
    
2012
  
Net income (loss)
   $ 0.6       (1.1 )     3.5  
Income tax expense (benefit)
     1.7       0.1       5.3  
Income (loss) before income tax
   expense (benefit)
     2.3       (1.0 )     8.8  
                         
Other expense:
                        
Interest expense (including
   amortization of deferred loan fees)
     16.8       16.9       16.8  
Other
     0.2       0.2       (0.2 )
Other expense, net
     17.0       17.1       16.6  
                         
Operating income
     19.3       16.1       25.4  
Depreciation and amortization expense
     32.6       32.6       32.1  
Equity investment
     (0.1 )     (0.2 )     0.2  
                         
EBITDA (Note 2)
     51.8       48.5       57.7  
Share-based compensation
     1.0       3.4       1.4  
Accretion
     -       0.2       0.2  
Non-controlling interests
     0.3       0.2       0.1  
Adjusted EBITDA (Note 1)
   $ 53.1       52.3       59.4  

 
 
 

General Communication, Inc.
            
Non-GAAP Financial Reconciliation Schedule
            
(Unaudited, Amounts in Millions)
            
             
             
   
Year Ended
  
   
December 31,
    
December 31,
  
   
2012
    
2011
  
Net income
   $ 9.2       5.5  
Income tax expense
     12.1       7.4  
Income before income tax expense
     21.3       12.9  
                 
Other expense:
                
Interest expense (including
   amortization of deferred loan fees)
     67.7       68.3  
Loss on extinguishment of debt
     -       9.1  
Other
     -       0.2  
Other expense, net
     67.7       77.6  
                 
Operating income
     89.0       90.5  
Depreciation and amortization expense
     130.4       125.9  
Other
     -       (0.2 )
                 
EBITDA (Note 2)
     219.4       216.2  
Share-based compensation
     5.0       6.6  
Accretion
     0.5       0.6  
Non-controlling interests
     0.9       0.2  
Non-cash contribution adjustment
     1.0       -  
Adjusted EBITDA (Note 1)
   $ 226.8       223.6  

 
 
 

Notes:
            
(1) EBITDA (as defined in Note 2 below) before deducting share-based compensation,
  
accretion expense, and net loss attributable to non-controlling interests 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.