STAMFORD, Conn., Oct. 29, 2021 /PRNewswire/ -- Charter
Communications, Inc. (along with its subsidiaries, the "Company" or
"Charter") today reported financial and operating results for the
three and nine months ended September 30, 2021.
Key highlights:
- Third quarter total residential and small and medium business
("SMB") customer relationships increased by 185,000. As of
September 30, 2021, Charter served a
total of 31.9 million residential and SMB customers, with 1.0
million net new customer relationships added over the last twelve
months.
- Third quarter total residential and SMB Internet customers
increased by 265,000. As of September 30,
2021, Charter served a total of 29.9 million residential and
SMB Internet customers, with 1.3 million total Internet customers
added over the last twelve months.
- Third quarter total residential and SMB mobile lines increased
by 244,000. As of September 30, 2021,
Charter served a total of 3.2 million mobile lines, with 1.1
million mobile lines added over the last twelve months.
- Third quarter revenue of $13.1
billion grew by 9.2% year-over-year, driven by residential
revenue growth of 9.4%, mobile revenue growth of 45.4% and
commercial revenue growth of 7.1%.
- Third quarter Adjusted EBITDA1 of $5.3 billion grew by 13.9% year-over-year.
- Net income attributable to Charter shareholders totaled
$1.2 billion in the third
quarter.
- Third quarter capital expenditures totaled $1.9 billion and included $119 million of mobile-related capital
expenditures.
- Third quarter free cash flow1 of $2.5 billion grew by 41.2% year-over-year.
- During the third quarter, Charter purchased approximately 5.3
million shares of Charter Class A common stock and Charter
Communications Holdings, LLC ("Charter Holdings") common units for
approximately $4.0 billion.
"The value of our connectivity products allowed us to add over 1
million customer relationships over the last year," said
Tom Rutledge, Chairman and CEO of
Charter. "Looking forward, we remain focused on improving both the
quality and value of our products as demand for more advanced
services grows. As data usage both inside and outside the home
continues to increase, so do our network and product capabilities.
We remain confident in our ability to grow customers, EBITDA and
free cash flow for many years to come."
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
|
|
|
September 30,
2021 (a)
|
|
September 30,
2020 (a)
|
|
September 30,
2019 (a)
|
Footprint
(b)
|
|
|
|
|
|
|
Estimated
Passings
|
|
54,152
|
|
|
53,022
|
|
|
51,940
|
|
|
|
|
|
|
|
|
Customer
Relationships (c)
|
|
|
|
|
|
|
Residential
|
|
29,823
|
|
|
28,912
|
|
|
27,037
|
|
SMB
|
|
2,126
|
|
|
2,021
|
|
|
1,930
|
|
Total Customer
Relationships
|
|
31,949
|
|
|
30,933
|
|
|
28,967
|
|
|
|
|
|
|
|
|
Residential
|
|
163
|
|
|
416
|
|
|
282
|
|
SMB
|
|
22
|
|
|
41
|
|
|
28
|
|
Total Customer
Relationships Quarterly Net Additions
|
|
185
|
|
|
457
|
|
|
310
|
|
|
|
|
|
|
|
|
Total Customer
Relationship Penetration of Estimated Passings (d)
|
|
59.0
|
%
|
|
58.3
|
%
|
|
55.8
|
%
|
|
|
|
|
|
|
|
Monthly Residential
Revenue per Residential Customer (e)
|
|
$
|
115.15
|
|
|
$
|
109.03
|
|
|
$
|
112.00
|
|
Monthly SMB Revenue
per SMB Customer (f)
|
|
$
|
167.29
|
|
|
$
|
164.77
|
|
|
$
|
169.44
|
|
|
|
|
|
|
|
|
Residential
Customer Relationships Penetration
|
|
|
|
|
|
|
Single Play
Penetration (g)
|
|
46.4
|
%
|
|
44.2
|
%
|
|
42.7
|
%
|
Double Play
Penetration (g)
|
|
32.8
|
%
|
|
32.3
|
%
|
|
29.9
|
%
|
Triple Play
Penetration (g)
|
|
20.9
|
%
|
|
23.5
|
%
|
|
27.3
|
%
|
|
|
|
|
|
|
|
% Residential
Non-Video Customer Relationships
|
|
48.7
|
%
|
|
45.7
|
%
|
|
41.8
|
%
|
|
|
|
|
|
|
|
Internet
|
|
|
|
|
|
|
Residential
|
|
27,965
|
|
|
26,807
|
|
|
24,595
|
|
SMB
|
|
1,934
|
|
|
1,826
|
|
|
1,730
|
|
Total Internet
Customers
|
|
29,899
|
|
|
28,633
|
|
|
26,325
|
|
|
|
|
|
|
|
|
Residential
|
|
243
|
|
|
494
|
|
|
351
|
|
SMB
|
|
22
|
|
|
43
|
|
|
29
|
|
Total Internet
Quarterly Net Additions
|
|
265
|
|
|
537
|
|
|
380
|
|
|
|
|
|
|
|
|
Video
|
|
|
|
|
|
|
Residential
|
|
15,287
|
|
|
15,705
|
|
|
15,725
|
|
SMB
|
|
604
|
|
|
530
|
|
|
520
|
|
Total Video
Customers
|
|
15,891
|
|
|
16,235
|
|
|
16,245
|
|
|
|
|
|
|
|
|
Residential
|
|
(133)
|
|
|
53
|
|
|
(77)
|
|
SMB
|
|
12
|
|
|
14
|
|
|
2
|
|
Total Video Quarterly
Net Additions
|
|
(121)
|
|
|
67
|
|
|
(75)
|
|
|
|
|
|
|
|
|
Voice
|
|
|
|
|
|
|
Residential
|
|
8,784
|
|
|
9,335
|
|
|
9,595
|
|
SMB
|
|
1,273
|
|
|
1,207
|
|
|
1,120
|
|
Total Voice
Customers
|
|
10,057
|
|
|
10,542
|
|
|
10,715
|
|
|
|
|
|
|
|
|
Residential
|
|
(230)
|
|
|
(63)
|
|
|
(213)
|
|
SMB
|
|
14
|
|
|
38
|
|
|
23
|
|
Total Voice Quarterly
Net Additions
|
|
(216)
|
|
|
(25)
|
|
|
(190)
|
|
|
|
|
|
|
|
|
Mobile Lines
(h)
|
|
|
|
|
|
|
Residential
|
|
3,085
|
|
|
2,020
|
|
|
793
|
|
SMB
|
|
99
|
|
|
40
|
|
|
1
|
|
Total Mobile
Lines
|
|
3,184
|
|
|
2,060
|
|
|
794
|
|
|
|
|
|
|
|
|
Residential
|
|
230
|
|
|
348
|
|
|
275
|
|
SMB
|
|
14
|
|
|
15
|
|
|
1
|
|
Total Mobile Lines
Quarterly Net Additions
|
|
244
|
|
|
363
|
|
|
276
|
|
|
|
|
|
|
|
|
Enterprise
(i)
|
|
|
|
|
|
|
Enterprise Primary
Service Units ("PSUs")
|
|
284
|
|
|
272
|
|
|
264
|
|
Enterprise Quarterly
Net Additions
|
|
4
|
|
|
2
|
|
|
6
|
|
|
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.
|
During the third quarter of 2021, Charter's residential customer
relationships grew by 163,000, compared to growth of 416,000 in the
third quarter of 2020 and 282,000 in the third quarter of 2019. As
of September 30, 2021, Charter had 29.8 million
residential customer relationships, with year-over-year growth of
3.2%.
Charter added 243,000 residential Internet customers during the
third quarter of 2021, compared to 494,000 during the third quarter
of 2020 and 351,000 during the third quarter of 2019. The lower net
additions relative to 2020 and 2019 was primarily a function of
fewer selling opportunities partly offset by lower churn in the
third quarter of 2021. Currently, 200 Mbps is the minimum speed
offered to new Spectrum Internet® customers in
85% of Charter's footprint. As of September 30, 2021, over 70%
of total Internet customers subscribed to tiers that provided 200
Mbps or more of speed. Charter also offers Spectrum Internet
Gig across its entire footprint. Charter's Advanced Home WiFi,
a managed WiFi service that provides customers an optimized home
network while providing greater control of their connected devices,
has been launched across nearly all of Charter's footprint for new
Internet connects. In addition, Charter's new WiFi 6 router offers
lower latency and performs better in environments with many
connected WiFi devices, and has the ability to offer speeds of well
over 1 Gbps.
Residential video customers decreased by 133,000 in the third
quarter of 2021, compared to an increase of 53,000 in the third
quarter of 2020 and a decrease of 77,000 in the third quarter of
2019. As of September 30, 2021, Charter had 15.3 million
residential video customers.
During the third quarter of 2021, residential wireline voice
customers declined by 230,000, compared to declines of 63,000 in
the third quarter of 2020 and 213,000 in the third quarter of 2019.
As of September 30, 2021, Charter had 8.8 million
residential wireline voice customers.
Third quarter 2021 residential revenue per residential customer
(excluding mobile) totaled $115.15,
and increased by 5.6% compared to the prior year period, given
$218 million of sports network
credits recorded in the prior year period that resulted from fewer
sporting events being broadcast due to the COVID-19 pandemic,
promotional rate step-ups and video rate adjustments that pass
through programmer rate increases, partly offset by a higher mix of
non-video customer relationships and a higher mix of lower priced
video packages within Charter's video customer base.
SMB customer relationships grew by 22,000 in the third quarter
of 2021, while third quarter 2020 and 2019 SMB customer
relationships grew by 41,000 and 28,000, respectively. During the
third quarter of 2021, enterprise PSUs grew by 4,000, compared to
growth of 2,000 in the third quarter of 2020 and 6,000 in the third
quarter of 2019.
During the third quarter of 2021, Charter added 244,000 mobile
lines, compared to growth of 363,000 during the third quarter of
2020 and 276,000 during the third quarter of 2019. Spectrum
MobileTM is available to all new and
existing Spectrum Internet customers. Spectrum Mobile
customers can choose one of two simple ways to pay for data,
"Unlimited" or "By the Gig." Early in the fourth quarter,
Spectrum Mobile introduced new Unlimited pricing starting at
$29.99/month per Unlimited line for
customers with at least two lines. Additionally, customers qualify
for the new multiline pricing when combining By the Gig lines for
$14/GB with Unlimited lines. All
Spectrum Mobile plans include 5G access, with no added
taxes, fees or contracts. Spectrum Mobile's new Unlimited
pricing is part of Charter's converged network strategy to provide
consumers a differentiated connectivity experience with highly
competitive, simple data plans and pricing.
Third Quarter Financial Results
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
UNAUDITED CONSOLIDATED STATEMENTS OF
OPERATIONS AND OPERATING DATA
|
(dollars in
millions, except per share data)
|
|
|
Three Months Ended
September 30,
|
|
2021
|
|
2020
|
|
%
Change
|
REVENUES:
|
|
|
|
|
|
Internet
|
$
|
5,363
|
|
|
$
|
4,722
|
|
|
13.6
|
%
|
Video
|
4,502
|
|
|
4,221
|
|
|
6.7
|
%
|
Voice
|
409
|
|
|
449
|
|
|
(8.8)
|
%
|
Residential
revenue
|
10,274
|
|
|
9,392
|
|
|
9.4
|
%
|
Small and medium
business
|
1,062
|
|
|
988
|
|
|
7.5
|
%
|
Enterprise
|
656
|
|
|
617
|
|
|
6.4
|
%
|
Commercial
revenue
|
1,718
|
|
|
1,605
|
|
|
7.1
|
%
|
Advertising
sales
|
391
|
|
|
460
|
|
|
(15.1)
|
%
|
Mobile
|
535
|
|
|
368
|
|
|
45.4
|
%
|
Other
|
228
|
|
|
214
|
|
|
6.5
|
%
|
Total
Revenue
|
13,146
|
|
|
12,039
|
|
|
9.2
|
%
|
|
|
|
|
|
|
COSTS AND
EXPENSES:
|
|
|
|
|
|
Total operating costs
and expenses
|
7,860
|
|
|
7,400
|
|
|
6.2
|
%
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
|
5,286
|
|
|
$
|
4,639
|
|
|
13.9
|
%
|
|
|
|
|
|
|
Adjusted EBITDA
margin
|
40.2
|
%
|
|
38.5
|
%
|
|
|
|
|
|
|
|
|
Capital
Expenditures
|
$
|
1,861
|
|
|
$
|
2,014
|
|
|
|
% Total
Revenue
|
14.2
|
%
|
|
16.7
|
%
|
|
|
|
|
|
|
|
|
Net income
attributable to Charter shareholders
|
$
|
1,217
|
|
|
$
|
814
|
|
|
|
Earnings per common
share attributable to Charter shareholders:
|
|
|
|
|
|
Basic
|
$
|
6.69
|
|
|
$
|
4.01
|
|
|
|
Diluted
|
$
|
6.50
|
|
|
$
|
3.90
|
|
|
|
|
|
|
|
|
|
Net cash flows from
operating activities
|
$
|
4,263
|
|
|
$
|
3,664
|
|
|
|
Free cash
flow
|
$
|
2,476
|
|
|
$
|
1,754
|
|
|
|
Revenues
Third quarter revenue increased by 9.2% year-over-year to
$13.1 billion, driven primarily by
growth in residential, mobile and commercial revenues. Excluding
advertising, which benefited from political spend in the third
quarter of 2020, and $218 million of
sports network credits recorded in the prior year period, revenue
grew by 8.1% year-over-year.
Residential revenue totaled $10.3
billion in the third quarter, an increase of 9.4%
year-over-year. The year-over-year revenue growth rate benefited in
part from the aforementioned sports network credits recorded in the
prior year period.
Internet revenue grew by 13.6% year-over-year to $5.4 billion, driven by growth in Internet
customers during the last year, promotional rate step-ups, rate
adjustments and higher bundled revenue allocation.
Video revenue totaled $4.5 billion
in the third quarter, an increase of 6.7% compared to the prior
year period, driven by the aforementioned $218 million of sports network credits recorded
in the prior year period, promotional rate step-ups and video rate
adjustments that pass through programmer rate increases, partly
offset by a higher mix of lower priced video packages within
Charter's video customer base, a decline in video customers during
the last year and lower bundled revenue allocation.
Voice revenue totaled $409 million
in the third quarter, a decrease of 8.8% compared to the third
quarter of 2020, driven by a decline in wireline voice customers
over the last twelve months and value-based pricing.
Commercial revenue increased by 7.1% year-over-year to
$1.7 billion, driven by SMB and
enterprise revenue growth of 7.5% and 6.4% year-over-year,
respectively. Third quarter 2021 SMB revenue growth benefited from
COVID-19 related impacts in the third quarter of 2020. Third
quarter 2021 enterprise revenue was impacted by a $16 million one-time benefit. Enterprise revenue
excluding wholesale and the one-time benefit increased by 6.5%
year-over-year, reflecting PSU growth.
Third quarter advertising sales revenue of $391 million decreased by 15.1% compared to the
year-ago quarter, driven by lower political revenue. Excluding
political revenue in both periods, advertising sales revenue
increased by 10.7% year-over-year, given higher advanced
advertising revenue in the third quarter of 2021 and COVID-19
related impacts in the prior year period.
Third quarter mobile revenue totaled $535
million, an increase of 45.4% year-over-year, primarily
driven by mobile line growth.
Other revenue totaled $228 million
in the third quarter, an increase of 6.5% year-over-year.
Operating Costs and Expenses
Third quarter total operating costs and expenses increased by
$460 million, or 6.2%
year-over-year.
Third quarter programming costs increased by $256 million, or 9.4% as compared to the third
quarter of 2020, reflecting $163
million of sports network rebates in the prior year period
that resulted from fewer games being broadcast during COVID-19 and
contractual programming increases and renewals, partly offset by
fewer video customers and a higher mix of lower cost packages
within Charter's video customer base.
Regulatory, connectivity and produced content expenses increased
by $22 million, or 3.5%
year-over-year, primarily driven by higher regulatory and franchise
fees and higher video CPE sold to customers.
Costs to service customers decreased by $3 million, or 0.2% year-over-year, despite
year-over-year residential and SMB customer growth of 3.3%. The
year-over-year decrease in costs to service customers was primarily
driven by lower transaction costs, offset by higher bad debt and
previously announced wage increases for hourly field operations and
call center employees as Charter meets its commitment to a minimum
$20 per hour wage in 2022.
Marketing expenses were unchanged year-over-year.
Third quarter mobile costs totaled $607
million, an increase of 33.2% year-over-year, and were
comprised of device costs, customer acquisition costs, and service
and operating costs.
Other expenses increased by $34
million, or 3.8% as compared to the third quarter of 2020,
primarily driven by higher corporate costs, partly offset by lower
advertising sales expense.
Adjusted EBITDA
Third quarter Adjusted EBITDA of $5.3
billion grew by 13.9% year-over-year, reflecting growth
in revenue and operating expenses of 9.2% and 6.2%,
respectively.
Net Income Attributable to Charter Shareholders
Net income attributable to Charter shareholders totaled
$1.2 billion in the third quarter of
2021, compared to $814
million in the third quarter of 2020. The year-over-year
increase in net income attributable to Charter shareholders was
primarily driven by higher Adjusted EBITDA, partly offset by higher
income tax expense and higher interest expense, net.
Net income per basic common share attributable to Charter
shareholders totaled $6.69 in the
third quarter of 2021 compared to $4.01 during the same period last year. The
increase was primarily the result of the factors described above in
addition to a 10.3% decrease in basic weighted average common
shares outstanding versus the prior year period.
Capital Expenditures
Property, plant and equipment expenditures totaled $1.9 billion in the third quarter of 2021,
compared to $2.0 billion during the
third quarter of 2020, primarily driven by decreases in scalable
infrastructure, line extensions and support capital. The decrease
in scalable infrastructure spending was primarily related to a
stabilized level of network traffic growth and investments made
earlier in the year. The decrease in line extensions was driven by
housing build delays due to supply chain constraints in the housing
industry. The year-over-year decrease in support capital was due to
timing. Third quarter capital expenditures included $119 million of mobile costs, most of which
related to retail stores and IT systems, and were included in
support capital.
Charter currently expects 2021 cable capital expenditures to be
relatively consistent as a percentage of cable revenue versus
2020.
Cash Flow and Free Cash Flow
During the third quarter of 2021, net cash flows from operating
activities totaled $4.3 billion,
compared to $3.7 billion in the prior
year quarter. The year-over-year increase in net cash flows from
operating activities was primarily due to higher Adjusted
EBITDA.
Free cash flow in the third quarter of 2021 totaled $2.5 billion, compared to $1.8 billion during the same period last year.
The year-over-year increase in free cash flow was primarily driven
by an increase in net cash flows from operating activities.
Liquidity & Financing
As of September 30, 2021, total principal amount of debt
was $87.9 billion and Charter's
credit facilities provided approximately $3.2 billion of additional liquidity in excess of
Charter's $466 million cash
position.
In July 2021, Charter redeemed
$1.0 billion of Time Warner Cable,
LLC's 4.000% notes due September
2021.
In August 2021, CCO Holdings, LLC
("CCO Holdings") and CCO Holdings Capital Corp. jointly issued
$2.0 billion of 4.250% senior
unsecured notes due 2034 at par. Net proceeds were used to pay
related fees and expenses and for general corporate purposes,
including repaying $1.25 billion
of CCO Holdings' 5.750% notes due February
2026 and $750 million of CCO
Holdings' 5.500% notes due May 2026
as well as funding buybacks of Charter Class A common stock and
Charter Holdings common units.
In October 2021, Charter
Communications Operating, LLC and Charter Communications Operating
Capital Corp. jointly issued $1.25
billion of 2.250% senior secured notes due 2029 at 99.835%
of the aggregate principal amount, $1.35
billion of 3.500% senior secured notes due 2042 at 99.253%
of the aggregate principal amount and $1.4
billion of 3.950% senior secured notes due 2062 at 99.186%
of the aggregate principal amount. Net proceeds were used to pay
related fees and expenses and for general corporate purposes,
including funding buybacks of Charter Class A common stock and
Charter Holdings common units as well as repaying certain
indebtedness.
Share Repurchases
During the three months ended September 30, 2021, Charter
purchased approximately 5.3 million shares of Charter Class A
common stock and Charter Holdings common units for approximately
$4.0 billion.
Conference Call
Charter will host a conference call on Friday, October 29,
2021 at 8:30 a.m. Eastern Time (ET)
related to the contents of this release.
The conference call will be webcast live via the Company's
investor relations website at ir.charter.com. The call will be
archived under the "Events & Webcasts" section two hours after
completion of the call. Participants should go to the webcast link
no later than 10 minutes prior to the start time to register.
Those participating via telephone should dial 866-919-0894 no
later than 10 minutes prior to the call. International participants
should dial 706-679-9379. The conference ID code for the call is
1537299.
A replay of the call will be available at 855-859-2056 or
404-537-3406 beginning two hours after the completion of the call
through the end of business on November 25,
2021. The conference ID code for the replay is 1537299.
Additional Information Available on Website
The information in this press release should be read in
conjunction with the financial statements and footnotes contained
in the Company's Quarterly Report on Form 10-Q for the three and
nine months ended September 30, 2021, which will be posted on
the "Results & SEC Filings" section of the Company's investor
relations website at ir.charter.com, when it is filed with the
Securities and Exchange Commission (the "SEC"). A slide
presentation to accompany the conference call and a trending
schedule containing historical customer and financial data will
also be available in the "Results & SEC Filings" section.
Use of Adjusted EBITDA and Free Cash Flow
Information
The company uses certain measures that are not defined by U.S.
generally accepted accounting principles ("GAAP") to evaluate
various aspects of its business. Adjusted EBITDA and free cash flow
are non-GAAP financial measures and should be considered in
addition to, not as a substitute for, net income attributable to
Charter shareholders and net cash flows from operating activities
reported in accordance with GAAP. These terms, as defined by
Charter, may not be comparable to similarly titled measures used by
other companies. Adjusted EBITDA and free cash flow are reconciled
to net income attributable to Charter shareholders and net cash
flows from operating activities, respectively, in the Addendum to
this release.
Adjusted EBITDA is defined as net income attributable to Charter
shareholders plus net income attributable to noncontrolling
interest, net interest expense, income taxes, depreciation and
amortization, stock compensation expense, other expenses, net and
other operating (income) expenses, net, such as special charges and
(gain) loss on sale or retirement of assets. As such, it eliminates
the significant non-cash depreciation and amortization expense that
results from the capital-intensive nature of the Company's
businesses as well as other non-cash or special items, and is
unaffected by the Company's capital structure or investment
activities. However, this measure is limited in that it does not
reflect the periodic costs of certain capitalized tangible and
intangible assets used in generating revenues and the cash cost of
financing. These costs are evaluated through other financial
measures.
Free cash flow is defined as net cash flows from operating
activities, less capital expenditures and changes in accrued
expenses related to capital expenditures.
Management and Charter's board of directors use Adjusted EBITDA
and free cash flow to assess Charter's performance and its ability
to service its debt, fund operations and make additional
investments with internally generated funds. In addition, Adjusted
EBITDA generally correlates to the leverage ratio calculation under
the Company's credit facilities or outstanding notes to determine
compliance with the covenants contained in the facilities and notes
(all such documents have been previously filed with the SEC). For
the purpose of calculating compliance with leverage covenants, the
Company uses Adjusted EBITDA, as presented, excluding certain
expenses paid by its operating subsidiaries to other Charter
entities. The Company's debt covenants refer to these expenses as
management fees, which were $337
million and $979 million for
the three and nine months ended September 30, 2021,
respectively, and $308 million and
$927 million for the three and nine
months ended September 30, 2020, respectively.
About Charter
Charter Communications, Inc. (NASDAQ:CHTR) is a leading
broadband connectivity company and cable operator serving more than
31 million customers in 41 states through its Spectrum brand. Over
an advanced communications network, the Company offers a full range
of state-of-the-art residential and business services including
Spectrum Internet®, TV, Mobile and Voice.
For small and medium-sized companies, Spectrum
Business® delivers the same suite of broadband products
and services coupled with special features and applications to
enhance productivity, while for larger businesses and government
entities, Spectrum Enterprise provides highly customized,
fiber-based solutions. Spectrum Reach® delivers tailored
advertising and production for the modern media landscape. The
company also distributes award-winning news coverage, sports and
high-quality original programming to its customers through Spectrum
Networks and Spectrum Originals. More information about Charter can
be found at corporate.charter.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This communication includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of
1934, as amended, regarding, among other things, our plans,
strategies and prospects, both business and financial.
Although we believe that our plans, intentions and expectations as
reflected in or suggested by these forward-looking statements are
reasonable, we cannot assure you that we will achieve or realize
these plans, intentions or expectations. Forward-looking
statements are inherently subject to risks, uncertainties and
assumptions including, without limitation, the factors described
under "Risk Factors" from time to time in our filings with the
SEC. Many of the forward-looking statements contained in this
communication may be identified by the use of forward-looking words
such as "believe," "expect," "anticipate," "should," "planned,"
"will," "may," "intend," "estimated," "aim," "on track," "target,"
"opportunity," "tentative," "positioning," "designed," "create,"
"predict," "project," "initiatives," "seek," "would," "could,"
"continue," "ongoing," "upside," "increases," "grow," "focused on"
and "potential," among others. Important factors that could
cause actual results to differ materially from the forward-looking
statements we make in this communication are set forth in our
annual report on Form 10-K, and in other reports or documents that
we file from time to time with the SEC, and include, but are not
limited to:
- our ability to sustain and grow revenues and cash flow from
operations by offering Internet, video, voice, mobile, advertising
and other services to residential and commercial customers, to
adequately meet the customer experience demands in our service
areas and to maintain and grow our customer base, particularly in
the face of increasingly aggressive competition, the need for
innovation and the related capital expenditures;
- the impact of competition from other market participants,
including but not limited to incumbent telephone companies, direct
broadcast satellite ("DBS") operators, wireless broadband and
telephone providers, digital subscriber line ("DSL") providers,
fiber to the home providers and providers of video content over
broadband Internet connections;
- general business conditions, unemployment levels and the level
of activity in the housing sector and economic uncertainty or
downturn, including the impacts of the Novel Coronavirus
("COVID-19") pandemic to our customers, our vendors and local,
state and federal governmental responses to the pandemic;
- our ability to obtain programming at reasonable prices or to
raise prices to offset, in whole or in part, the effects of higher
programming costs (including retransmission consents and
distribution requirements);
- our ability to develop and deploy new products and technologies
including mobile products and any other consumer services and
service platforms;
- any events that disrupt our networks, information systems or
properties and impair our operating activities or our
reputation;
- the effects of governmental regulation on our business
including subsidies to consumers, subsidies and incentives for
competitors, costs, disruptions and possible limitations on
operating flexibility related to, and our ability to comply with,
regulatory conditions applicable to us;
- the ability to hire and retain key personnel;
- our ability to procure necessary services and equipment from
our vendors at reasonable costs;
- the availability and access, in general, of funds to meet our
debt obligations prior to or when they become due and to fund our
operations and necessary capital expenditures, either through (i)
cash on hand, (ii) free cash flow, or (iii) access to the capital
or credit markets; and
- our ability to comply with all covenants in our indentures and
credit facilities, any violation of which, if not cured in a timely
manner, could trigger a default of our other obligations under
cross-default provisions.
All forward-looking statements attributable to us or any person
acting on our behalf are expressly qualified in their entirety by
this cautionary statement. We are under no duty or obligation
to update any of the forward-looking statements after the date of
this communication.
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
UNAUDITED CONSOLIDATED STATEMENTS OF
OPERATIONS AND OPERATING DATA
|
(dollars in
millions, except per share data)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2021
|
|
2020
|
|
%
Change
|
|
2021
|
|
2020
|
|
%
Change
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
|
Internet
|
$
|
5,363
|
|
|
$
|
4,722
|
|
|
13.6
|
%
|
|
$
|
15,670
|
|
|
$
|
13,659
|
|
|
14.7
|
%
|
Video
|
4,502
|
|
|
4,221
|
|
|
6.7
|
%
|
|
13,224
|
|
|
13,014
|
|
|
1.6
|
%
|
Voice
|
409
|
|
|
449
|
|
|
(8.8)
|
%
|
|
1,202
|
|
|
1,357
|
|
|
(11.4)
|
%
|
Residential
revenue
|
10,274
|
|
|
9,392
|
|
|
9.4
|
%
|
|
30,096
|
|
|
28,030
|
|
|
7.4
|
%
|
Small and medium
business
|
1,062
|
|
|
988
|
|
|
7.5
|
%
|
|
3,116
|
|
|
2,967
|
|
|
5.0
|
%
|
Enterprise
|
656
|
|
|
617
|
|
|
6.4
|
%
|
|
1,930
|
|
|
1,845
|
|
|
4.7
|
%
|
Commercial
revenue
|
1,718
|
|
|
1,605
|
|
|
7.1
|
%
|
|
5,046
|
|
|
4,812
|
|
|
4.9
|
%
|
Advertising
sales
|
391
|
|
|
460
|
|
|
(15.1)
|
%
|
|
1,146
|
|
|
1,074
|
|
|
6.6
|
%
|
Mobile
|
535
|
|
|
368
|
|
|
45.4
|
%
|
|
1,546
|
|
|
936
|
|
|
65.2
|
%
|
Other
|
228
|
|
|
214
|
|
|
6.5
|
%
|
|
636
|
|
|
621
|
|
|
2.4
|
%
|
Total
Revenue
|
13,146
|
|
|
12,039
|
|
|
9.2
|
%
|
|
38,470
|
|
|
35,473
|
|
|
8.4
|
%
|
COSTS AND
EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
Programming
|
2,983
|
|
|
2,727
|
|
|
9.4
|
%
|
|
8,949
|
|
|
8,492
|
|
|
5.4
|
%
|
Regulatory,
connectivity and produced content
|
634
|
|
|
612
|
|
|
3.5
|
%
|
|
1,902
|
|
|
1,651
|
|
|
15.2
|
%
|
Costs to service
customers
|
1,899
|
|
|
1,902
|
|
|
(0.2)
|
%
|
|
5,530
|
|
|
5,598
|
|
|
(1.2)
|
%
|
Marketing
|
788
|
|
|
788
|
|
|
—
|
%
|
|
2,280
|
|
|
2,273
|
|
|
0.3
|
%
|
Mobile
|
607
|
|
|
456
|
|
|
33.2
|
%
|
|
1,765
|
|
|
1,243
|
|
|
42.0
|
%
|
Other
expense
|
949
|
|
|
915
|
|
|
3.8
|
%
|
|
2,793
|
|
|
2,692
|
|
|
3.8
|
%
|
Total operating costs
and expenses (exclusive of items shown separately below)
|
7,860
|
|
|
7,400
|
|
|
6.2
|
%
|
|
23,219
|
|
|
21,949
|
|
|
5.8
|
%
|
Adjusted
EBITDA
|
5,286
|
|
|
4,639
|
|
|
13.9
|
%
|
|
15,251
|
|
|
13,524
|
|
|
12.8
|
%
|
Adjusted EBITDA
margin
|
40.2
|
%
|
|
38.5
|
%
|
|
|
|
39.6
|
%
|
|
38.1
|
%
|
|
|
Depreciation and
amortization
|
2,270
|
|
|
2,370
|
|
|
|
|
7,065
|
|
|
7,295
|
|
|
|
Stock compensation
expense
|
98
|
|
|
83
|
|
|
|
|
332
|
|
|
263
|
|
|
|
Other operating
(income) expenses, net
|
(9)
|
|
|
14
|
|
|
|
|
284
|
|
|
23
|
|
|
|
Income from
operations
|
2,927
|
|
|
2,172
|
|
|
|
|
7,570
|
|
|
5,943
|
|
|
|
OTHER INCOME
(EXPENSES):
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(1,016)
|
|
|
(946)
|
|
|
|
|
(3,003)
|
|
|
(2,883)
|
|
|
|
Other expenses,
net
|
(157)
|
|
|
(117)
|
|
|
|
|
(237)
|
|
|
(413)
|
|
|
|
|
(1,173)
|
|
|
(1,063)
|
|
|
|
|
(3,240)
|
|
|
(3,296)
|
|
|
|
Income before income
taxes
|
1,754
|
|
|
1,109
|
|
|
|
|
4,330
|
|
|
2,647
|
|
|
|
Income tax
expense
|
(347)
|
|
|
(177)
|
|
|
|
|
(844)
|
|
|
(372)
|
|
|
|
Consolidated net
income
|
1,407
|
|
|
932
|
|
|
|
|
3,486
|
|
|
2,275
|
|
|
|
Less: Net income
attributable to noncontrolling interests
|
(190)
|
|
|
(118)
|
|
|
|
|
(442)
|
|
|
(299)
|
|
|
|
Net income
attributable to Charter shareholders
|
$
|
1,217
|
|
|
$
|
814
|
|
|
|
|
$
|
3,044
|
|
|
$
|
1,976
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON
SHARE ATTRIBUTABLE TO CHARTER SHAREHOLDERS:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
6.69
|
|
|
$
|
4.01
|
|
|
|
|
$
|
16.33
|
|
|
$
|
9.62
|
|
|
|
Diluted
|
$
|
6.50
|
|
|
$
|
3.90
|
|
|
|
|
$
|
15.78
|
|
|
$
|
9.35
|
|
|
|
Weighted average
common shares outstanding, basic
|
181,925,180
|
|
|
202,826,502
|
|
|
|
|
186,380,681
|
|
|
205,468,736
|
|
|
|
Weighted average
common shares outstanding, diluted
|
187,166,071
|
|
|
208,722,129
|
|
|
|
|
197,316,667
|
|
|
211,399,781
|
|
|
|
|
Adjusted EBITDA is a
non-GAAP term. See page 6 of this addendum for the
reconciliation of Adjusted EBITDA to net income attributable to
Charter shareholders as defined by GAAP.
|
|
All percentages are
calculated using whole numbers. Minor differences may exist due to
rounding.
|
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED BALANCE
SHEETS
|
(dollars in
millions)
|
|
|
September
30,
|
|
December
31,
|
|
2021
|
|
2020
|
ASSETS
|
(unaudited)
|
|
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$
|
466
|
|
|
$
|
1,001
|
|
Accounts receivable,
net
|
2,645
|
|
|
2,539
|
|
Prepaid expenses and
other current assets
|
387
|
|
|
369
|
|
Total current
assets
|
3,498
|
|
|
3,909
|
|
|
|
|
|
INVESTMENT IN CABLE
PROPERTIES:
|
|
|
|
Property, plant and
equipment, net
|
34,179
|
|
|
34,357
|
|
Customer
relationships, net
|
4,419
|
|
|
5,615
|
|
Franchises
|
67,322
|
|
|
67,322
|
|
Goodwill
|
29,554
|
|
|
29,554
|
|
Total investment in
cable properties, net
|
135,474
|
|
|
136,848
|
|
|
|
|
|
OTHER NONCURRENT
ASSETS
|
3,523
|
|
|
3,449
|
|
|
|
|
|
Total
assets
|
$
|
142,495
|
|
|
$
|
144,206
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
Accounts payable and
accrued liabilities
|
$
|
9,241
|
|
|
$
|
8,867
|
|
Current portion of
long-term debt
|
2,996
|
|
|
1,008
|
|
Total current
liabilities
|
12,237
|
|
|
9,875
|
|
|
|
|
|
LONG-TERM
DEBT
|
85,376
|
|
|
81,744
|
|
DEFERRED INCOME
TAXES
|
18,980
|
|
|
18,108
|
|
OTHER LONG-TERM
LIABILITIES
|
4,376
|
|
|
4,198
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
Controlling
interest
|
17,030
|
|
|
23,805
|
|
Noncontrolling
interests
|
4,496
|
|
|
6,476
|
|
Total shareholders'
equity
|
21,526
|
|
|
30,281
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
|
142,495
|
|
|
$
|
144,206
|
|
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
UNAUDITED CONSOLIDATED STATEMENTS OF
CASH FLOWS
|
(dollars in
millions)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Consolidated net
income
|
$
|
1,407
|
|
|
$
|
932
|
|
|
$
|
3,486
|
|
|
$
|
2,275
|
|
Adjustments to
reconcile consolidated net income to net cash flows from operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
2,270
|
|
|
2,370
|
|
|
7,065
|
|
|
7,295
|
|
Stock compensation
expense
|
98
|
|
|
83
|
|
|
332
|
|
|
263
|
|
Noncash interest
income, net
|
(5)
|
|
|
(10)
|
|
|
(20)
|
|
|
(31)
|
|
Deferred income
taxes
|
297
|
|
|
151
|
|
|
668
|
|
|
252
|
|
Other, net
|
155
|
|
|
100
|
|
|
279
|
|
|
379
|
|
Changes in operating
assets and liabilities, net of effects from acquisitions and
dispositions:
|
|
|
|
|
|
|
|
Accounts
receivable
|
(62)
|
|
|
(95)
|
|
|
(106)
|
|
|
75
|
|
Prepaid expenses and
other assets
|
(14)
|
|
|
(55)
|
|
|
(127)
|
|
|
(156)
|
|
Accounts payable,
accrued liabilities and other
|
117
|
|
|
188
|
|
|
436
|
|
|
61
|
|
Net cash flows from
operating activities
|
4,263
|
|
|
3,664
|
|
|
12,013
|
|
|
10,413
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
Purchases of property,
plant and equipment
|
(1,861)
|
|
|
(2,014)
|
|
|
(5,563)
|
|
|
(5,352)
|
|
Change in accrued
expenses related to capital expenditures
|
74
|
|
|
104
|
|
|
(51)
|
|
|
(70)
|
|
Real estate
investments through variable interest entities
|
(5)
|
|
|
(41)
|
|
|
(128)
|
|
|
(122)
|
|
Other, net
|
2
|
|
|
(35)
|
|
|
(20)
|
|
|
(43)
|
|
Net cash flows from
investing activities
|
(1,790)
|
|
|
(1,986)
|
|
|
(5,762)
|
|
|
(5,587)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Borrowings of
long-term debt
|
4,305
|
|
|
3,030
|
|
|
15,263
|
|
|
10,352
|
|
Repayments of
long-term debt
|
(3,892)
|
|
|
(1,819)
|
|
|
(9,651)
|
|
|
(9,711)
|
|
Payments for debt
issuance costs
|
(18)
|
|
|
(29)
|
|
|
(76)
|
|
|
(91)
|
|
Issuance of
equity
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
Purchase of treasury
stock
|
(3,666)
|
|
|
(3,361)
|
|
|
(10,834)
|
|
|
(6,868)
|
|
Proceeds from exercise
of stock options
|
17
|
|
|
50
|
|
|
43
|
|
|
171
|
|
Purchase of
noncontrolling interest
|
(410)
|
|
|
(366)
|
|
|
(1,500)
|
|
|
(884)
|
|
Distributions to
noncontrolling interest
|
—
|
|
|
(37)
|
|
|
(71)
|
|
|
(114)
|
|
Borrowings for real
estate investments through variable interest entities
|
5
|
|
|
39
|
|
|
128
|
|
|
59
|
|
Other, net
|
(59)
|
|
|
(1)
|
|
|
(88)
|
|
|
(26)
|
|
Net cash flows from
financing activities
|
(3,718)
|
|
|
(2,494)
|
|
|
(6,786)
|
|
|
(7,089)
|
|
|
|
|
|
|
|
|
|
NET DECREASE IN CASH
AND CASH EQUIVALENTS
|
(1,245)
|
|
|
(816)
|
|
|
(535)
|
|
|
(2,263)
|
|
CASH AND CASH
EQUIVALENTS, beginning of period
|
1,711
|
|
|
2,102
|
|
|
1,001
|
|
|
3,549
|
|
CASH AND CASH
EQUIVALENTS, end of period
|
$
|
466
|
|
|
$
|
1,286
|
|
|
$
|
466
|
|
|
$
|
1,286
|
|
|
|
|
|
|
|
|
|
CASH PAID FOR
INTEREST
|
$
|
1,042
|
|
|
$
|
1,038
|
|
|
$
|
3,038
|
|
|
$
|
3,023
|
|
CASH PAID FOR
TAXES
|
$
|
30
|
|
|
$
|
34
|
|
|
$
|
99
|
|
|
$
|
84
|
|
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
UNAUDITED SUMMARY
OF OPERATING STATISTICS
|
(in thousands,
except per customer and penetration data)
|
|
|
|
Approximate as
of
|
|
|
September 30,
2021 (a)
|
|
September 30,
2020 (a)
|
|
September 30,
2019 (a)
|
Footprint
(b)
|
|
|
|
|
|
|
Estimated
Passings
|
|
54,152
|
|
|
53,022
|
|
|
51,940
|
|
|
|
|
|
|
|
|
Customer
Relationships (c)
|
|
|
|
|
|
|
Residential
|
|
29,823
|
|
|
28,912
|
|
|
27,037
|
|
SMB
|
|
2,126
|
|
|
2,021
|
|
|
1,930
|
|
Total Customer
Relationships
|
|
31,949
|
|
|
30,933
|
|
|
28,967
|
|
|
|
|
|
|
|
|
Residential
|
|
163
|
|
|
416
|
|
|
282
|
|
SMB
|
|
22
|
|
|
41
|
|
|
28
|
|
Total Customer
Relationships Quarterly Net Additions
|
|
185
|
|
|
457
|
|
|
310
|
|
|
|
|
|
|
|
|
Total Customer
Relationship Penetration of Estimated Passings (d)
|
|
59.0
|
%
|
|
58.3
|
%
|
|
55.8
|
%
|
|
|
|
|
|
|
|
Monthly Residential
Revenue per Residential Customer (e)
|
|
$
|
115.15
|
|
|
$
|
109.03
|
|
|
$
|
112.00
|
|
Monthly SMB Revenue
per SMB Customer (f)
|
|
$
|
167.29
|
|
|
$
|
164.77
|
|
|
$
|
169.44
|
|
|
|
|
|
|
|
|
Residential
Customer Relationships Penetration
|
|
|
|
|
|
|
Single Play
Penetration (g)
|
|
46.4
|
%
|
|
44.2
|
%
|
|
42.7
|
%
|
Double Play
Penetration (g)
|
|
32.8
|
%
|
|
32.3
|
%
|
|
29.9
|
%
|
Triple Play
Penetration (g)
|
|
20.9
|
%
|
|
23.5
|
%
|
|
27.3
|
%
|
|
|
|
|
|
|
|
% Residential
Non-Video Customer Relationships
|
|
48.7
|
%
|
|
45.7
|
%
|
|
41.8
|
%
|
|
|
|
|
|
|
|
Internet
|
|
|
|
|
|
|
Residential
|
|
27,965
|
|
|
26,807
|
|
|
24,595
|
|
SMB
|
|
1,934
|
|
|
1,826
|
|
|
1,730
|
|
Total Internet
Customers
|
|
29,899
|
|
|
28,633
|
|
|
26,325
|
|
|
|
|
|
|
|
|
Residential
|
|
243
|
|
|
494
|
|
|
351
|
|
SMB
|
|
22
|
|
|
43
|
|
|
29
|
|
Total Internet
Quarterly Net Additions
|
|
265
|
|
|
537
|
|
|
380
|
|
|
|
|
|
|
|
|
Video
|
|
|
|
|
|
|
Residential
|
|
15,287
|
|
|
15,705
|
|
|
15,725
|
|
SMB
|
|
604
|
|
|
530
|
|
|
520
|
|
Total Video
Customers
|
|
15,891
|
|
|
16,235
|
|
|
16,245
|
|
|
|
|
|
|
|
|
Residential
|
|
(133)
|
|
|
53
|
|
|
(77)
|
|
SMB
|
|
12
|
|
|
14
|
|
|
2
|
|
Total Video Quarterly
Net Additions
|
|
(121)
|
|
|
67
|
|
|
(75)
|
|
|
|
|
|
|
|
|
Voice
|
|
|
|
|
|
|
Residential
|
|
8,784
|
|
|
9,335
|
|
|
9,595
|
|
SMB
|
|
1,273
|
|
|
1,207
|
|
|
1,120
|
|
Total Voice
Customers
|
|
10,057
|
|
|
10,542
|
|
|
10,715
|
|
|
|
|
|
|
|
|
Residential
|
|
(230)
|
|
|
(63)
|
|
|
(213)
|
|
SMB
|
|
14
|
|
|
38
|
|
|
23
|
|
Total Voice Quarterly
Net Additions
|
|
(216)
|
|
|
(25)
|
|
|
(190)
|
|
|
|
|
|
|
|
|
Mobile Lines
(h)
|
|
|
|
|
|
|
Residential
|
|
3,085
|
|
|
2,020
|
|
|
793
|
|
SMB
|
|
99
|
|
|
40
|
|
|
1
|
|
Total Mobile
Lines
|
|
3,184
|
|
|
2,060
|
|
|
794
|
|
|
|
|
|
|
|
|
Residential
|
|
230
|
|
|
348
|
|
|
275
|
|
SMB
|
|
14
|
|
|
15
|
|
|
1
|
|
Total Mobile Lines
Quarterly Net Additions
|
|
244
|
|
|
363
|
|
|
276
|
|
|
|
|
|
|
|
|
Enterprise
(i)
|
|
|
|
|
|
|
Enterprise Primary
Service Units ("PSUs")
|
|
284
|
|
|
272
|
|
|
264
|
|
Enterprise Quarterly
Net Additions
|
|
4
|
|
|
2
|
|
|
6
|
|
|
|
(a)
|
We calculate the
aging of customer accounts based on the monthly billing cycle for
each account. On that basis, at September 30, 2021,
September 30, 2020 and September 30, 2019, customers included
approximately 160,700, 181,700 and 148,000 customers, respectively,
whose accounts were over 60 days past due, approximately 42,000,
52,300 and 16,400 customers, respectively, whose accounts were over
90 days past due and approximately 32,600, 26,000 and 14,100
customers, respectively, whose accounts were over 120 days past
due.
|
|
|
(b)
|
Passings represent
our estimate of the number of units, such as single family homes,
apartment and condominium units and SMB and enterprise sites passed
by our cable distribution network in the areas where we offer the
service indicated. These estimates are based upon the
information available at this time and are updated for all periods
presented when new information becomes available.
|
|
|
(c)
|
Customer
relationships include the number of customers that receive one or
more levels of service, encompassing Internet, video and voice
services, without regard to which service(s) such customers
receive. Customers who reside in residential multiple
dwelling units ("MDUs") and that are billed under bulk contracts
are counted based on the number of billed units within each bulk
MDU. Total customer relationships exclude enterprise and
mobile-only customer relationships.
|
|
|
(d)
|
Penetration
represents residential and SMB customers as a percentage of
estimated passings. Penetration excludes mobile-only
customers.
|
|
|
(e)
|
Monthly residential
revenue per residential customer is calculated as total residential
quarterly revenue divided by three divided by average residential
customer relationships during the respective quarter and excludes
mobile revenue and customers.
|
|
|
(f)
|
Monthly SMB revenue
per SMB customer is calculated as total SMB quarterly revenue
divided by three divided by average SMB customer relationships
during the respective quarter and excludes mobile revenue and
customers.
|
|
|
(g)
|
Single play, double
play and triple play penetration represents the number of
residential single play, double play and triple play cable
customers, respectively, as a percentage of residential customer
relationships, excluding mobile.
|
|
|
(h)
|
Mobile lines include
phones and tablets which require one of our standard rate plans
(e.g., "Unlimited" or "By the Gig"). Mobile lines exclude
wearables and other devices that do not require standard phone rate
plans.
|
|
|
(i)
|
Enterprise PSUs
represents the aggregate number of fiber service offerings counting
each separate service offering at each customer location as an
individual PSU.
|
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
UNAUDITED
RECONCILIATION OF NON-GAAP MEASURES TO GAAP MEASURES
|
(dollars in
millions)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Net income
attributable to Charter shareholders
|
$
|
1,217
|
|
|
$
|
814
|
|
|
$
|
3,044
|
|
|
$
|
1,976
|
|
Plus: Net income
attributable to noncontrolling interest
|
190
|
|
|
118
|
|
|
442
|
|
|
299
|
|
Interest expense,
net
|
1,016
|
|
|
946
|
|
|
3,003
|
|
|
2,883
|
|
Income tax
expense
|
347
|
|
|
177
|
|
|
844
|
|
|
372
|
|
Depreciation and
amortization
|
2,270
|
|
|
2,370
|
|
|
7,065
|
|
|
7,295
|
|
Stock compensation
expense
|
98
|
|
|
83
|
|
|
332
|
|
|
263
|
|
Other expenses,
net
|
148
|
|
|
131
|
|
|
521
|
|
|
436
|
|
Adjusted EBITDA
(a)
|
$
|
5,286
|
|
|
$
|
4,639
|
|
|
$
|
15,251
|
|
|
$
|
13,524
|
|
|
|
|
|
|
|
|
|
Net cash flows from
operating activities
|
$
|
4,263
|
|
|
$
|
3,664
|
|
|
$
|
12,013
|
|
|
$
|
10,413
|
|
Less: Purchases
of property, plant and equipment
|
(1,861)
|
|
|
(2,014)
|
|
|
(5,563)
|
|
|
(5,352)
|
|
Change in accrued
expenses related to capital expenditures
|
74
|
|
|
104
|
|
|
(51)
|
|
|
(70)
|
|
Free cash
flow
|
$
|
2,476
|
|
|
$
|
1,754
|
|
|
$
|
6,399
|
|
|
$
|
4,991
|
|
|
|
(a)
|
See page 1 of this
addendum for detail of the components included within Adjusted
EBITDA.
|
|
|
The above schedule is
presented in order to reconcile Adjusted EBITDA and free cash flow,
non-GAAP measures, to the most directly comparable GAAP measures in
accordance with Section 401(b) of the Sarbanes-Oxley
Act.
|
CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
|
UNAUDITED CAPITAL
EXPENDITURES
|
(dollars in
millions)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Customer premise
equipment (a)
|
$
|
513
|
|
|
$
|
520
|
|
|
$
|
1,496
|
|
|
$
|
1,501
|
|
Scalable
infrastructure (b)
|
375
|
|
|
424
|
|
|
1,223
|
|
|
979
|
|
Line extensions
(c)
|
392
|
|
|
439
|
|
|
1,191
|
|
|
1,204
|
|
Upgrade/rebuild
(d)
|
178
|
|
|
175
|
|
|
484
|
|
|
459
|
|
Support capital
(e)
|
403
|
|
|
456
|
|
|
1,169
|
|
|
1,209
|
|
Total
capital expenditures
|
$
|
1,861
|
|
|
$
|
2,014
|
|
|
$
|
5,563
|
|
|
$
|
5,352
|
|
|
|
|
|
|
|
|
|
Capital expenditures
included in total related to:
|
|
|
|
|
|
|
|
Commercial
services
|
$
|
353
|
|
|
$
|
358
|
|
|
$
|
1,083
|
|
|
$
|
942
|
|
Mobile
|
$
|
119
|
|
|
$
|
139
|
|
|
$
|
355
|
|
|
$
|
351
|
|
|
|
(a)
|
Customer premise
equipment includes costs incurred at the customer residence to
secure new customers and revenue generating units, including
customer installation costs and customer premise equipment (e.g.,
digital receivers and cable modems).
|
(b)
|
Scalable
infrastructure includes costs, not related to customer premise
equipment, to secure growth of new customers and revenue generating
units, or provide service enhancements (e.g., headend
equipment).
|
(c)
|
Line extensions
include network costs associated with entering new service areas
(e.g., fiber/coaxial cable, amplifiers, electronic equipment,
make-ready and design engineering).
|
(d)
|
Upgrade/rebuild
includes costs to modify or replace existing fiber/coaxial cable
networks, including betterments.
|
(e)
|
Support capital
includes costs associated with the replacement or enhancement of
non-network assets due to technological and physical obsolescence
(e.g., non-network equipment, land, buildings and
vehicles).
|
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SOURCE Charter Communications, Inc.