InvestorsJanuary 29, 2021
Charter Announces Fourth Quarter and Full Year 2020 Results
Share Article:
Key highlights:
- As of
December 31, 2020 , Charter served a total of 31.1 million residential and small and medium business ("SMB") customers, with 1.9 million customers added in 2020 versus 1.1 million added in 2019. Charter added 197,000 total customer relationships in the fourth quarter, compared to 268,000 during the fourth quarter of 2019. - As of
December 31, 2020 , Charter served a total of 28.9 million residential and SMB Internet customers, with 2.2 million Internet customers added in 2020 versus 1.4 million added in 2019. Charter added 246,000 total Internet customers in the fourth quarter compared to 339,000 during the fourth quarter of 2019. - As of
December 31, 2020 , Charter served a total of 2.4 million mobile lines, with 1.3 million mobile lines added in 2020 versus 948,000 added in 2019. Charter added 315,000 mobile lines in the fourth quarter, compared to 288,000 during the fourth quarter of 2019. - Fourth quarter revenue of
$12.6 billion grew by 7.3% year-over-year, driven by residential revenue growth of 5.0%, mobile revenue growth of 80.9% and advertising revenue growth of 43.9%. - Fourth quarter Adjusted EBITDA1 of
$5.0 billion grew by 10.2% year-over-year. - For the year ended
December 31, 2020 , revenue of$48.1 billion increased by 5.1% year-over-year. Full year 2020 Adjusted EBITDA totaled$18.5 billion , 9.9% higher than in 2019. - Net income attributable to Charter shareholders totaled
$1.2 billion in the fourth quarter, compared to$714 million during the same period last year. For the year endedDecember 31, 2020 , net income attributable to Charter shareholders totaled$3.2 billion , compared to$1.7 billion in 2019. - Fourth quarter capital expenditures totaled
$2.1 billion and included$157 million of mobile-related capital expenditures. For the year endedDecember 31, 2020 , capital expenditures totaled$7.4 billion and included$508 million of mobile-related capital expenditures. - Full year 2020 free cash flow1 totaled
$7.1 billion , compared to$4.6 billion in 2019. - During the fourth quarter, Charter purchased approximately 7.4 million shares of Charter Class A common stock and
Charter Communications Holdings, LLC ("Charter Holdings ") common units for approximately$4.8 billion . For the year endedDecember 31, 2020 , Charter purchased 21.1 million shares of Charter Class A common stock andCharter Holdings common units for approximately$12.1 billion .
"Our 2020 performance demonstrates that our customer-friendly operating strategy works well for Charter communities, employees and shareholders, even in challenging economic and operating environments," said
1. |
Adjusted EBITDA and free cash flow are non-GAAP measures defined in the "Use of Adjusted EBITDA and Free Cash Flow Information" section and are reconciled to net income attributable to Charter shareholders and net cash flows from operating activities, respectively, in the addendum of this news release. |
Key Operating Results |
|||||||||||
Approximate as of |
|||||||||||
|
|
Y/Y Change |
|||||||||
Footprint (b) |
|||||||||||
Estimated Passings |
53,300 |
52,154 |
2.2 |
% |
|||||||
Customer Relationships (c) |
|||||||||||
Residential |
29,079 |
27,277 |
6.6 |
% |
|||||||
SMB |
2,051 |
1,958 |
4.8 |
% |
|||||||
Total Customer Relationships |
31,130 |
29,235 |
6.5 |
% |
|||||||
Residential |
167 |
240 |
(30.3) |
% |
|||||||
SMB |
30 |
28 |
10.2 |
% |
|||||||
Total Customer Relationships Quarterly Net Additions |
197 |
268 |
(26.2) |
% |
|||||||
Total Customer Relationship Penetration of Estimated Passings (d) |
58.4 |
% |
56.1 |
% |
2.3 ppts |
||||||
Monthly Residential Revenue per Residential Customer (e) |
$ |
111.85 |
$ |
113.79 |
(1.7) |
% |
|||||
Monthly SMB Revenue per SMB Customer (f) |
$ |
163.02 |
$ |
169.06 |
(3.6) |
% |
|||||
Residential Customer Relationships Penetration |
|||||||||||
Single Play Penetration (g) |
44.5 |
% |
43.0 |
% |
1.5 ppts |
||||||
Double Play Penetration (g) |
32.7 |
% |
30.7 |
% |
2.0 ppts |
||||||
Triple Play Penetration (g) |
22.9 |
% |
26.2 |
% |
(3.3) ppts |
||||||
% Residential Non-Video Customer Relationships |
46.2 |
% |
42.7 |
% |
3.5 ppts |
||||||
Internet |
|||||||||||
Residential |
27,023 |
24,908 |
8.5 |
% |
|||||||
SMB |
1,856 |
1,756 |
5.7 |
% |
|||||||
Total Internet Customers |
28,879 |
26,664 |
8.3 |
% |
|||||||
Residential |
216 |
313 |
(30.9) |
% |
|||||||
SMB |
30 |
26 |
13.8 |
% |
|||||||
Total Internet Quarterly Net Additions |
246 |
339 |
(27.4) |
% |
|||||||
Video |
|||||||||||
Residential |
15,639 |
15,620 |
0.1 |
% |
|||||||
SMB |
561 |
524 |
7.0 |
% |
|||||||
Total Video Customers |
16,200 |
16,144 |
0.3 |
% |
|||||||
Residential |
(66) |
(105) |
37.4 |
% |
|||||||
SMB |
31 |
4 |
678.5 |
% |
|||||||
Total Video Quarterly Net Additions |
(35) |
(101) |
65.3 |
% |
|||||||
Voice |
|||||||||||
Residential |
9,215 |
9,443 |
(2.4) |
% |
|||||||
SMB |
1,224 |
1,144 |
7.0 |
% |
|||||||
Total Voice Customers |
10,439 |
10,587 |
(1.4) |
% |
|||||||
Residential |
(120) |
(152) |
21.4 |
% |
|||||||
SMB |
17 |
24 |
(30.1) |
% |
|||||||
Total Voice Quarterly Net Additions |
(103) |
(128) |
19.7 |
% |
|||||||
Mobile Lines |
|||||||||||
Residential |
2,320 |
1,078 |
115.3 |
% |
|||||||
SMB |
55 |
4 |
NM |
||||||||
Total Mobile Lines |
2,375 |
1,082 |
119.6 |
% |
|||||||
Residential |
300 |
285 |
5.5 |
% |
|||||||
SMB |
15 |
3 |
316.4 |
% |
|||||||
Total Mobile Lines Quarterly Net Additions |
315 |
288 |
9.4 |
% |
|||||||
Enterprise (h) |
|||||||||||
Enterprise Primary Service Unites ("PSUs") |
274 |
267 |
2.6 |
% |
|||||||
Enterprise Quarterly Net Additions |
2 |
3 |
(36.9) |
% |
Footnotes - In thousands, except per customer and penetration data. See footnotes to unaudited summary of operating statistics on page 5 of the addendum of this news release. The footnotes contain important disclosures regarding the definitions used for these operating statistics. All percentages are calculated using whole numbers. Minor differences may exist due to rounding. NM - Not meaningful |
In 2020, Charter added 1.8 million residential customer relationships versus 1.0 million added in 2019. During the fourth quarter of 2020, Charter's residential customer relationships grew by 167,000, while fourth quarter 2019 residential customer relationships increased by 240,000.
Charter added 2.1 million residential Internet customers in 2020, versus 1.3 million added in 2019. During the fourth quarter of 2020, Charter added 216,000 residential Internet customers versus fourth quarter 2019 net additions of 313,000, which is a function of lower sales activity caused by adding 1.9 million residential Internet customers in the prior three quarters as well as lower market churn, resulting in fewer selling opportunities in the fourth quarter. As of
Charter added 19,000 residential video customers in 2020, compared to a decline of 484,000 in 2019. Residential video customers decreased by 66,000 in the fourth quarter of 2020, while fourth quarter 2019 residential video customers decreased by 105,000.
In 2020, Charter's residential wireline voice customers declined by 228,000 versus a decline of 692,000 in 2019. During the fourth quarter of 2020, residential wireline voice customers declined by 120,000, while fourth quarter 2019 residential wireline voice customers declined by 152,000.
Fourth quarter 2020 residential revenue per residential customer (excluding mobile) totaled
Charter added 93,000 SMB customer relationships in 2020, compared to 125,000 added in 2019. SMB customer relationships grew by 30,000 in the fourth quarter of 2020, while fourth quarter 2019 SMB customer relationships grew by 28,000. Enterprise PSUs grew by 7,000 in 2020 versus 19,000 added in 2019. During the fourth quarter of 2020, enterprise PSUs grew by 2,000, compared to growth of 3,000 in the fourth quarter of 2019.
In 2020, Charter added 1.3 million mobile lines versus 948,000 added in 2019. During the fourth quarter of 2020, Charter added 315,000 mobile lines, compared to 288,000 in the fourth quarter of 2019. Spectrum MobileTM is available to all new and existing Spectrum Internet customers and runs on America's most awarded LTE network combined with Spectrum WiFi. Spectrum Mobile customers can choose one of two simple ways to pay for data, "Unlimited" or "By the Gig." All plans include 4G and 5G access, with no added taxes, fees or contracts.
Fourth Quarter Financial Results
|
||||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND OPERATING DATA |
||||||||||
(dollars in millions, except per share data) |
||||||||||
Three Months Ended |
||||||||||
2020 |
2019 |
% Change |
||||||||
REVENUES: |
||||||||||
Internet |
$ |
4,862 |
$ |
4,345 |
11.9 |
% |
||||
Video |
4,418 |
4,473 |
(1.2) |
% |
||||||
Voice |
449 |
450 |
(0.2) |
% |
||||||
Residential revenue |
9,729 |
9,268 |
5.0 |
% |
||||||
Small and medium business |
997 |
986 |
1.1 |
% |
||||||
Enterprise |
623 |
617 |
0.9 |
% |
||||||
Commercial revenue |
1,620 |
1,603 |
1.0 |
% |
||||||
Advertising sales |
625 |
434 |
43.9 |
% |
||||||
Mobile |
428 |
236 |
80.9 |
% |
||||||
Other |
222 |
220 |
1.5 |
% |
||||||
Total Revenue |
12,624 |
11,761 |
7.3 |
% |
||||||
COSTS AND EXPENSES: |
||||||||||
Total operating costs and expenses |
7,630 |
7,232 |
5.5 |
% |
||||||
Adjusted EBITDA |
$ |
4,994 |
$ |
4,529 |
10.2 |
% |
||||
Adjusted EBITDA margin |
39.6 |
% |
38.5 |
% |
||||||
Capital Expenditures |
$ |
2,063 |
$ |
2,282 |
||||||
% Total Revenue |
16.3 |
% |
19.4 |
% |
||||||
Net income attributable to Charter shareholders |
$ |
1,246 |
$ |
714 |
||||||
Earnings per common share attributable to Charter shareholders: |
||||||||||
Basic |
$ |
6.33 |
$ |
3.36 |
||||||
Diluted |
$ |
6.05 |
$ |
3.28 |
||||||
Net cash flows from operating activities |
$ |
4,149 |
$ |
3,358 |
||||||
Free cash flow |
$ |
2,079 |
$ |
1,580 |
Revenues
Fourth quarter revenue increased by 7.3% year-over-year to
Internet revenue grew by 11.9% year-over-year to
Video revenue totaled
Voice revenue totaled
Residential revenue totaled
Commercial revenue increased by 1.0% year-over-year to
Fourth quarter advertising sales revenue of
Fourth quarter mobile revenue totaled
Other revenue totaled
Operating Costs and Expenses
Fourth quarter total operating costs and expenses increased by
Fourth quarter programming costs increased by
Regulatory, connectivity and produced content expenses decreased by
Costs to service customers increased by
Marketing expenses increased by
Other expenses increased by
Fourth quarter mobile costs totaled
Adjusted EBITDA
Fourth quarter Adjusted EBITDA of
Net Income Attributable to Charter Shareholders
Net income attributable to Charter shareholders totaled
Net income per basic common share attributable to Charter shareholders totaled
Capital Expenditures
Property, plant and equipment expenditures totaled
Cash Flow and Free Cash Flow
During the fourth quarter of 2020, net cash flows from operating activities totaled
Free cash flow in the fourth quarter of 2020 totaled
Liquidity & Financing
As of
In
In
Share Repurchases
During the three months ended
Full Year Financial Results
|
||||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND OPERATING DATA |
||||||||||
(dollars in millions, except per share data) |
||||||||||
Year Ended |
||||||||||
2020 |
2019 |
% Change |
||||||||
REVENUES: |
||||||||||
Internet |
$ |
18,521 |
$ |
16,667 |
11.1 |
% |
||||
Video |
17,432 |
17,607 |
(1.0) |
% |
||||||
Voice |
1,806 |
1,920 |
(5.9) |
% |
||||||
Residential revenue |
37,759 |
36,194 |
4.3 |
% |
||||||
Small and medium business |
3,964 |
3,868 |
2.5 |
% |
||||||
Enterprise |
2,468 |
2,556 |
(3.5) |
% |
||||||
Commercial revenue |
6,432 |
6,424 |
0.1 |
% |
||||||
Advertising sales |
1,699 |
1,568 |
8.3 |
% |
||||||
Mobile |
1,364 |
726 |
87.9 |
% |
||||||
Other |
843 |
852 |
(0.9) |
% |
||||||
Total Revenue |
48,097 |
45,764 |
5.1 |
% |
||||||
COSTS AND EXPENSES: |
||||||||||
Total operating costs and expenses |
29,579 |
28,909 |
2.3 |
% |
||||||
Adjusted EBITDA |
$ |
18,518 |
$ |
16,855 |
9.9 |
% |
||||
Adjusted EBITDA margin |
38.5 |
% |
36.8 |
% |
||||||