InvestorsMay 2, 2001
Charter Communications Announces Solid First Quarter Results; Digital Video and High-Speed Data Deployments Exceed Expectations
ST. LOUIS--(BUSINESS WIRE)--May 2, 2001--Charter Communications, Inc. (Nasdaq: CHTR) today reported revenue and operating cash flow growth at the high end of previously stated guidance for the first quarter of 2001. Digital video and high-speed data service additions during the three-month period ended March 31, 2001 exceeded the company's expectations, according to Jerry Kent, President and CEO.
First Quarter Financial Highlights
For the first quarter of 2001 revenues increased 14.4% to $873.8 million, and operating cash flow (OCF) increased 9.7% to $387.9 million compared to the pro forma results for the first quarter of 2000. Charter increased its customer base by over 2.0% compared to pro forma first quarter of 2000 to 6,349,800 customers. "We continue to deliver by increasing revenue and OCF through internal and advanced broadband services customer growth made possible by our digital platform," Mr. Kent said.
Demand for Advanced Services Continues
As of March 31, 2001, Charter Digital Cable(TM) customers totaled 1,343,700, an increase of 274,800 customers over pro forma year-end 2000. Mr. Kent said Charter's goal is to add an average of 18,000 digital cable customers per week throughout the year. "During the first quarter we exceeded our year 2001 average weekly net digital add target by approximately 18%," Mr. Kent said. "The compelling price-value relationship of our digital video product in comparison to DBS contributes greatly to our success. Over 20,000 satellite dish owners have been converted to Charter Digital Cable over the past year," he said.
High-speed data service was available to 55% of Charter's homes passed as of March 31, 2001, according to Mr. Kent. "With an expanded footprint of two-way enacted broadband plant, the deployment of Charter Pipeline(TM), our high-speed data service, accelerated in the first quarter of 2001." As of March 31, 2001, Charter served 343,300 data customers, adding 90,900 Charter Pipeline customers during the first quarter, or 7,000 customers per week. "We capitalized on our larger two-way footprint by aggressively marketing and deploying our high-speed data product, exceeding our year 2001 average weekly goal by nearly 50% in the first quarter," Mr. Kent said.
In February 2001, Charter entered into several agreements with AT&T Broadband, LLC involving several strategic cable system transactions that will result in a net addition of approximately 512,000 customers. When completed, Charter will acquire cable systems from AT&T Broadband serving approximately 574,000 customers in Missouri, Alabama, Nevada and California for a total of $1.79 billion. A portion of the purchase price will consist of Charter cable systems valued at $249.0 million serving approximately 62,000 customers in Florida, and up to $501.5 million will be paid in Class A common stock. The balance will be paid in cash. When the transactions close in the late second or early third quarter, Charter will serve approximately 7 million customers in 40 states.
In February 2001, Charter and Gemstar-TV Guide entered into a long-term Interactive Program Guide (IPG) agreement. Terms of the agreement provide for Charter to continue to use and further deploy TV Guide Interactive(SM) into additional markets, and across all digital platforms. TV Guide Interactive is the IPG currently used by Charter in 200 systems representing over 600,000 digital households. Charter's rollout of a TV Gateway IPG is also underway in thirteen markets, serving some 250,000 customers, with additional deployments planned.
In March 2001, Charter announced the selection of Liberate Technologies open standards-based software in their rollout of interactive cable television services to advanced set-tops. Charter digital customers in St. Louis will be the first to experience Liberate-enabled Motorola DCT 5000 set-tops, initially equipped with Internet access, the TV Guide Interactive programming guide, and television-based e-mail and interactive television portal services developed and supported by digeo, inc.
Mr. Kent reiterated Charter's previous 2001 annual guidance of 14% - 16% revenue growth and 12% - 14% operating cash flow growth, and second quarter 2001 revenue growth of 13% - 15% and OCF growth of
11.5% - 13.5%. Mr. Kent said Charter anticipates ending the year 2001 with approximately 2 million digital cable customers. "We expect to significantly exceed our original guidance of 500,000 data customers, and are now comfortable we'll end the year within a range of 550,000 - 600,000 data customers." Mr. Kent said Charter has plans for additional video on demand launches and expects approximately 2.2 million homes will have access to VOD technology by the end of 2001.
About Charter Communications
Charter Communications, a Wired World(TM) company, is among the nation's largest broadband communications companies, currently serving some 6.4 million customers in 40 states. Charter provides a full range of advanced broadband services to the home, including cable television under the Charter Cable TV brand; advanced digital video programming services under the Charter Digital Cable(TM) brand; and high-speed Internet access via Charter Pipeline(TM). Commercial high-speed data, video and Internet solutions are provided under the Charter Business Networks(TM) brand. Advertising sales and production services are sold under the Charter Media(TM) brand.
A Fortune 500 company, Charter is the 2001 recipient of the Outstanding Corporate Growth Award from the Association for Corporate Growth, the 2001 R.E. "Ted" Turner Innovator of the Year Award from the Southern Cable Telecommunications Association, and the 2000 Innovator Award for Technology from Cablevision Magazine.
More information about Charter can be found at www.charter.com.
Detailed financial information is included in the attached addendum.
Charter will conduct a conference call to discuss their operating results on Wednesday, May 2, 2001, at 11:00 AM Eastern Time. The call will be available live via webcast at www.charter.com. The call will be available on the "Investor" portion of the website, via "About Charter." Participants should go to the call link at least 10 minutes prior to the start time to register. The call will be archived on the website.
Statements in this press release regarding Charter Communications' business that are not historical facts may be "forward-looking statements." Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Important factors that could cause actual results to differ materially from any such forward-looking statements are identified in the reports and documents Charter files from time to time with the U.S. Securities and Exchange Commission.
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|CONTACT:||Charter Communications, Inc.|
|Andy Morgan, 314/543-2217|
|Mary Jo Moehle, 314/543-2397|