Mediacom Q3 Revenue Up, Guides Lower for 2007
Triple-Play Gains Help to Offset Loss of 13,000 Basic Subscribers
By Jon Hemingway -- Broadcasting & Cable, 11/6/2007 10:53:00 AM
Mediacom Communications’ revenues were up in the third quarter on a rise in revenue-generating units while the company lost 13,000 basic subscribers during the quarter.
The company’s third-quarter revenues rose 7.4% to $328.3 million from $305.6 million in the same period a year ago, led by a 16% jump in data revenues to $70.5 million, an 83.8% surge in the phone segment to $14.4 million and a 12.1% rise in advertising to $17.4 million. Revenue from the video segment rose 2% to $225.9 million on higher service fees from advanced video products and services and basic-video rate increases.
The rise in video revenue was partially offset by a loss of 13,000 basic subscribers in the quarter, 3,000 of which were attributable to the sale of a cable system, compared with 6,000 losses in the same quarter in 2006. The company lost 18,000 subscribers in the second quarter of this year.
Digital customers grew 5% to 541,000 from the same quarter in 2006 while data customers grew 16.9% to 636,000 and the cable operator’s phone-customer base rose 98.8% to 165,000.
Medicom’s total RGUs rose 5.4% to 2.673 million while the average monthly revenue per basic subscriber grew 12.2% to $81.81.
"Despite softer-than-expected net RGU growth this quarter, we are pleased with the improved product mix as customers increasingly embrace our multiple-product platform," Mediacom chairman and CEO Rocco Commisso said in a statement, "More profitable double- and triple-play customers are replacing video-only subscribers, as reflected by the dramatic 12% increase in year-over-year total ARPU [average revenue per unit]."
For the third quarter of 2007, Mediacom’s adjusted operating income before depreciation and amortization (OIBDA) rose 5.4% to $116.7 million versus the same period a year ago while its operating income was off less than 1% at $55.4 million. The company’s net loss in the quarter was $36.3 million, or $0.34 per share, versus $89.8 million ($0.82) in Q3 2006.
The company’s free cash flow was negative $19.7 million for the nine months ended Sept. 30, compared with positive $6.8 million in the prior-year period.
Mediacom said that given the current business trends, it was revising its full-year-2007 growth forecasts. The company now sees revenue growth in the 6.5%-7% range versus 7%-8% previously while adjusted OIBDA is expected to be in the 4%-5% range from 6%-7%. Capital-expenditure guidance is expected to be around $225 million from $215 million.
The company also announced that a new $50 million stock-repurchase program was authorized by its board.
