UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 25, 2016
CABLEVISION SYSTEMS CORPORATION
(Exact name of registrant as specified in its charter)
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| | | |
Delaware | No. 1-14764 | No. 11-3415180 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
| | |
CSC HOLDINGS, LLC |
(Exact Name of Registrant as Specified in its Charter) |
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Delaware |
(State of Incorporation) |
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No. 1-9046 | No. 27-0726696 |
(Commission File Number) | (IRS Employer Identification Number) |
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1111 Stewart Avenue | |
Bethpage, New York | 11714 |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (516) 803-2300
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On February 25, 2016, the Registrants announced their financial results for the quarter ended December 31, 2015. A copy of the press release containing the announcement is included as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01 Financial Statement and Exhibits
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| | | | |
(d) | Exhibits. |
| | | | |
| | | Earnings Press Release dated February 25, 2016. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| CABLEVISION SYSTEMS CORPORATION |
| (Registrant) |
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| By: | | /s/ Victoria M. Mink |
| | Name: | Victoria M. Mink |
| | Title: | Senior Vice President, Controller and Principal Accounting Officer |
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Dated: February 25, 2016 | | | |
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| CSC HOLDINGS, LLC |
| (Registrant) |
| |
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| By: | | /s/ Victoria M. Mink |
| | Name: | Victoria M. Mink |
| | Title: | Senior Vice President, Controller and Principal Accounting Officer |
| | | |
Dated: February 25, 2015 | | | |
CABLEVISION SYSTEMS CORPORATION
REPORTS FOURTH QUARTER AND FULL YEAR 2015 RESULTS
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* | Cablevision delivers first year of organic growth in total customer relationships since 2008; Company also gained 49,000 high-speed data customers during 2015 |
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* | Full year 2015 Consolidated Free Cash Flow from Continuing Operations1 of $447.4 million |
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* | Full year 2015 Consolidated Net Revenues increase to $6.510 billion |
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* | Industry-leading Average Monthly Cable Revenue per Customer ("RPC") of $155.88 |
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* | Customer service initiatives continued to improve efficiencies in the fourth quarter of 2015, with a 30 percent reduction in trouble call truck rolls compared to the prior year period |
Bethpage, NY, February 25, 2016 - Cablevision Systems Corporation (NYSE:CVC) today reported financial results for the fourth quarter and full year ended December 31, 2015.
Fourth quarter consolidated net revenues decreased 0.1% to $1.629 billion, consolidated adjusted operating cash flow (“AOCF”)1 decreased 2.1% to $431.7 million and consolidated operating income decreased 4.2% to $197.1 million, all compared with the prior year period. Fourth quarter 2015 results included unfavorable items totaling $14.2 million, as discussed later in this release. Excluding these items, consolidated AOCF and operating income would have increased 1.1% and 2.7%, respectively, compared to the prior year period.
For full year 2015, consolidated net revenues increased 0.8% to $6.510 billion, consolidated AOCF decreased 3.1% to $1.777 billion and consolidated operating income decreased 7.9% to $848.5 million, all compared to 2014. 2015 results included unfavorable items totaling $48.0 million, as discussed later in this release. Excluding these items, consolidated net revenues would have increased 0.8%, and AOCF and operating income would have decreased 0.5% and 2.7%, respectively, compared to the prior year period.
Cablevision CEO James L. Dolan said, “2015 marked a turning point for Cablevision in several ways. We increased total Cablevision customer relationships and ended the year with more high-speed data customers than ever before in the nation’s most competitive telecommunications market. Cablevision’s improved operational performance demonstrates our continued execution of strategic initiatives, including competing on value rather than price, providing better products and services, and delivering a superior customer experience. We continue to move full speed ahead towards the completion of our transaction with Altice, and we are proceeding through the regulatory process as expected.”
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1. | See definition of AOCF and Consolidated Free Cash Flow from Continuing Operations included in the discussion of non-GAAP financial measures on page 4 of this earnings release. |
Cable
Cable includes our Optimum-branded digital cable television, high-speed Internet and voice services as well as Optimum WiFi, the nation's most robust WiFi network.
Cable net revenues for the fourth quarter 2015 increased 0.1% to $1.456 billion, primarily due to an increase in high-speed data customers, rate initiatives and continued disciplined pricing strategies, partially offset by lower advertising revenue and fewer video and voice customers compared to the prior year period. AOCF decreased 1.5% to $434.5 million and operating income decreased 4.4% to $237.8 million, both compared with the prior year period. Fourth quarter AOCF primarily reflects higher programming costs partially offset by lower employee and customer service-related costs, as compared to the prior year period.
In addition, fourth quarter 2015 results included a $6.1 million inventory valuation adjustment. If excluded, AOCF and operating income would have decreased 0.1% and 1.9%, respectively, compared to the prior year period.
For full year 2015, Cable net revenues increased 0.9% to $5.836 billion, AOCF decreased 3.6% to $1.768 billion and operating income decreased 7.4% to $985.4 million, all compared to 2014. 2015 results included a $12.8 million reserve for the probable settlement of a class action legal matter (of which $3.3 million is reflected as a reduction in revenue), and an inventory valuation adjustment of $17.4 million. Excluding these items, Cable net revenues would have increased 0.9%, and AOCF and operating income would have decreased 2.0% and 4.6%, respectively, compared to the prior year period.
Customer Data
Cablevision delivered the first year of organic growth in total customer relationships since 2008 with a net gain of 2,400, an improvement of 72,000 compared to 2014. In addition, at year end 2015, the Company had more high-speed data customers in the New York market than ever before, with a net gain of 49,000 compared to 2014. Video customer results showed marked improvement in 2015 with 45,000 fewer losses than the prior year period.
During the fourth quarter of 2015, Cablevision experienced the lowest quarterly competitive voluntary churn in more than six years, while continuing its disciplined pricing strategies.
The following table illustrates the change in the Cable customer base during the fourth quarter of 2015:
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(rounded to nearest thousand) | Total
September 30, 2015 |
Net Gain/(Loss) | Total December 31, 2015 |
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Total Customers(a) | 3,107 | 13 | 3,120 |
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Video | 2,604 | (10) | 2,594 |
High-Speed Data | 2,784 | 25 | 2,809 |
Voice | 2,188 | 5 | 2,193 |
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Serviceable Passings | 5,075 | 5 | 5,080 |
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(a) | Total customers are defined as the number of households/businesses that receive at least one of the Company's services. |
Customer Service
During 2015, Cablevision continued to improve the customer experience through its service initiatives which have resulted in 23 percent fewer trouble call truck rolls and 33 percent fewer repeat trouble calls, compared to 2014. Since these initiatives were implemented three years ago, the Company has reduced the number of trouble call truck rolls by 35 percent and has reduced by half the number of repeat trouble calls.
WiFi
Cablevision continued to optimize the density and quality of its WiFi network through the deployment of smart routers and outside access points in high usage areas, ending the year with more than 1.4 million Optimum WiFi access points. At year end, more than 1 million customers used Optimum WiFi monthly and averaged more than 9 gigabytes of data usage per month via Optimum WiFi. Additionally, Optimum WiFi users generated nearly 5 billion sessions in 2015, and passed 112 million gigabytes of data, which is equivalent to streaming 100,000 high-definition movies per day and more than double the amount of data passed in 2014.
Lightpath
Lightpath is an industry leader in providing advanced Ethernet-based data, Internet, voice, video transport solutions and managed services to large and mid-sized organizations throughout the New York metropolitan area.
The company operates one of the densest metro area fiber networks in the U.S., with more than 7,000 lit locations. In the education market, Lightpath’s popular Hosted Voice, Private Fiber Network and comprehensive data services offer an attractive solution for schools to provide premium connectivity for staff and students.
For the fourth quarter 2015, Lightpath net revenues increased 0.8% to $91.0 million, AOCF increased 7.9% to $43.9 million and operating income increased 13.3% to $19.2 million, each as compared with the prior year period. Fourth quarter results primarily reflect reduced operating expenses and an increase in revenue from Ethernet services.
For full year 2015, Lightpath net revenues increased 3.3% to $364.4 million, AOCF increased 9.8% to $173.0 million and operating income increased 12.2% to $76.6 million, each as compared with 2014.
Other
Other principally consists of Newsday, News 12 Networks, Cablevision Media Sales Corporation and certain other businesses and unallocated corporate costs.
Fourth quarter net revenues decreased 5.4% to $91.1 million, primarily due to lower advertising revenue at Newsday. The AOCF deficit increased 14.4% to $46.8 million and operating loss increased 0.1% to $59.9 million, all compared with the prior year period. Fourth quarter AOCF reflects lower revenue and merger-related costs of $8.2 million, partially offset by lower operating costs at Newsday.
If the merger-related costs were excluded, the AOCF deficit and operating loss would have improved 5.5% and 13.5%, respectively, compared to the prior year period.
For full year 2015, Other net revenues decreased 3.7% to $347.8 million, AOCF deficit increased 4.0% to $163.2 million and operating loss increased 1.2% to $213.6 million, each as compared with 2014. The 2015 results included merger-related costs of $17.9 million. If these costs were excluded, the AOCF deficit and operating loss would have improved 7.4% and 7.3%, respectively, compared to 2014.
Other Matters
On September 16, 2015, Cablevision and Altice N.V. entered into a definitive agreement pursuant to which Altice has agreed to acquire Cablevision for $34.90 in cash for each share of Cablevision Class A and Class B common stock.
Assuming timely satisfaction of the necessary closing conditions, the acquisition by Altice is currently expected to close in the second quarter of 2016.
Due to the pending acquisition by Altice and the terms of the merger agreement, Cablevision has suspended its stock repurchase program and does not anticipate declaring or paying any dividends during the pendency of the acquisition.
For additional information, please refer to our SEC filings at www.cablevision.com.
Non-GAAP Financial Measures
We define adjusted operating cash flow (“AOCF”), which is a non-GAAP financial measure, as operating income (loss) before depreciation and amortization (including impairments), excluding share-based compensation expense and restructuring charges or credits. Because it is based upon operating income (loss), AOCF also excludes interest expense (including cash interest expense) and other non-operating income and expense items. We believe that the exclusion of share-based compensation expense allows investors to better track the performance of the various operating units of our business without regard to expense associated with awards that are not expected to be made in cash, in the case of restricted shares, restricted stock units and stock options, and the distortive effects of fluctuating stock prices in the case of liability classified awards.
We present AOCF as a measure of our ability to service our debt and make continuing investments, including in our capital infrastructure. We believe AOCF is an appropriate measure for evaluating the operating performance of our business segments and the Company on a consolidated basis. AOCF and similar measures with similar titles are common performance measures used by investors, analysts and peers to compare performance in our industry. Internally, we use net revenues and AOCF measures as the most important indicators of our business performance, and evaluate management’s effectiveness with specific reference to these indicators. AOCF should be viewed as a supplement to and not a substitute for operating income (loss), net income (loss), cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with U.S. generally accepted accounting principles ("GAAP"). Since AOCF is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similar measures with similar titles used by other companies. For a reconciliation of AOCF to operating income (loss), please see page 7 of this release.
We define Consolidated Free Cash Flow from Continuing Operations (“Free Cash Flow”), which is a non-GAAP financial measure, as net cash from operating activities (continuing operations) plus any excess tax benefit related to share-based awards less capital expenditures (continuing operations), all of which are reported in our Consolidated Statement of Cash Flows. Net cash from operating activities excludes net cash from operating activities of our discontinued operations. We believe the most comparable GAAP financial measure of our liquidity is net cash from operating activities. We believe that Free Cash Flow is useful as an indicator of our overall liquidity, as the amount of Free Cash Flow generated in any period is representative of cash that is available for debt repayment and other discretionary and non-discretionary cash uses. It is also one of several indicators of our ability to make investments and/or return capital to our shareholders. We also believe that Free Cash Flow is one of several benchmarks used by analysts and investors who follow our industry for comparison of our liquidity with other companies in our industry, although our measure of Free Cash Flow may not be directly comparable to similar measures reported by other companies.
ABOUT CABLEVISION
Cablevision Systems Corporation (NYSE: CVC) is a leading media and telecommunications company, serving millions of households and businesses throughout the greater New York area. Providing quality products that keep customers connected, Cablevision offers Optimum-branded digital cable television, high-speed Internet and voice services as well as Optimum WiFi, the nation's most robust WiFi network. Cablevision’s Lightpath subsidiary is a premier provider of integrated business communications solutions for larger companies. Through its local media and programming properties – News 12 Networks and Newsday Media Group – Cablevision also delivers news and information created specifically for the communities it serves. Additional information about Cablevision is available at www.cablevision.com.
This earnings release may contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties, including the risks and uncertainties associated with the expected timing and likelihood of the consummation of the pending acquisition by Altice, including regarding the timing, receipt and terms and conditions of any required governmental approvals or that the pending acquisition with Altice will not be consummated at all, and the risks that the proposed acquisition by Altice and its announcement could have an adverse effect on the ability of Cablevision to retain and hire key personnel and maintain relationships with its suppliers and customers and on its operating results and businesses generally, and that actual results or developments may differ materially from those in the forward-looking statements as a result of various factors, including financial community and rating agency perceptions of the Company and its business, operations, financial condition and the industries in which it operates and the factors described in the Company’s filings with the Securities and Exchange Commission, including the sections entitled "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" contained therein. The Company disclaims any obligation to update any forward-looking statements contained herein.
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Contacts: | Charles Schueler | | Cindi Buckwalter |
| Executive Vice President | | Senior Vice President |
| Media and Community Relations | | Investor Relations |
| (516) 803-1013 | | (516) 803-2264 |
Due to the pending acquisition by Altice, Cablevision will discontinue conference calls to discuss its quarterly and annual results during the pendency of the acquisition.
Detailed financial and operating information related to the Company's fourth quarter and full year 2015 results are available in Cablevision's Form 10-K for the period ended December 31, 2015, filed today with the Securities and Exchange Commission.
For additional information, please visit Cablevision’s Investor Relations website at www.cablevision.com.
CABLEVISION SYSTEMS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(Unaudited) |
| | | | | | | | | | | | | | | |
| Three Months Ended December 31, | | Twelve Months Ended December 31, |
| 2015 | | 2014 | | 2015 | | 2014 |
| | | | | | | |
Revenues, net | $ | 1,628,978 |
| | $ | 1,631,036 |
| | $ | 6,509,743 |
| | $ | 6,460,946 |
|
| | | | | | | |
Operating expenses | | | | | | | |
Technical and operating | 795,831 |
| | 787,880 |
| | 3,198,194 |
| | 3,136,808 |
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Selling, general and administrative | 421,504 |
| | 413,310 |
| | 1,599,475 |
| | 1,533,898 |
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Restructuring expense (credits) | (632 | ) | | 1,950 |
| | (1,649 | ) | | 2,480 |
|
Depreciation and amortization (including impairments) | 215,135 |
| | 222,060 |
| | 865,252 |
| | 866,502 |
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Operating income | 197,140 |
| | 205,836 |
| | 848,471 |
| | 921,258 |
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Other income (expense): | | | | | | | |
Interest expense, net | (147,252 | ) | | (145,121 | ) | | (584,839 | ) | | (575,580 | ) |
Gain (loss) on investments, net | (9,567 | ) | | 90,671 |
| | (30,208 | ) | | 129,659 |
|
Gain (loss) on equity derivative contracts, net | 15,311 |
| | (64,770 | ) | | 104,927 |
| | (45,055 | ) |
Gain (loss) on extinguishment of debt and write-off of deferred financing costs | — |
| | 109 |
| | (1,735 | ) | | (10,120 | ) |
Miscellaneous, net | 1,931 |
| | 1,640 |
| | 6,045 |
| | 4,988 |
|
Income from continuing operations before income taxes | 57,563 |
| | 88,365 |
| | 342,661 |
| | 425,150 |
|
Income tax expense (a) | (23,782 | ) | | (32,046 | ) | | (154,872 | ) | | (115,768 | ) |
Income from continuing operations, net of income taxes | 33,781 |
| | 56,319 |
| | 187,789 |
| | 309,382 |
|
Income (loss) from discontinued operations, net of income taxes (b) | (1,633 | ) | | (175 | ) | | (12,541 | ) | | 2,822 |
|
Net income | 32,148 |
| | 56,144 |
| | 175,248 |
| | 312,204 |
|
Net loss (income) attributable to noncontrolling interests | (30 | ) | | (169 | ) | | 201 |
| | (765 | ) |
Net income attributable to Cablevision Systems Corporation stockholders | $ | 32,118 |
| | $ | 55,975 |
| | $ | 175,449 |
| | $ | 311,439 |
|
| | | | | | | |
Basic income (loss) per share attributable to Cablevision Systems Corporation stockholders: | | | | | | | |
Income from continuing operations, net of income taxes | $ | 0.12 |
| | $ | 0.21 |
| | $ | 0.70 |
| | $ | 1.17 |
|
Income (loss) from discontinued operations, net of income taxes | $ | (0.01 | ) | | $ | — |
| | $ | (0.05 | ) | | $ | 0.01 |
|
Net income | $ | 0.12 |
| | $ | 0.21 |
| | $ | 0.65 |
| | $ | 1.18 |
|
Basic weighted average common shares (in thousands) | 270,277 |
| | 266,969 |
| | 269,388 |
| | 264,623 |
|
Diluted income (loss) per share attributable to Cablevision Systems Corporation stockholders: | | | | | | | |
Income from continuing operations, net of income taxes | $ | 0.12 |
| | $ | 0.20 |
| | $ | 0.68 |
| | $ | 1.14 |
|
Income (loss) from discontinued operations, net of income taxes | $ | (0.01 | ) | | $ | — |
| | $ | (0.05 | ) | | $ | 0.01 |
|
Net income | $ | 0.12 |
| | $ | 0.20 |
| | $ | 0.63 |
| | $ | 1.15 |
|
Diluted weighted average common shares (in thousands) | 278,439 |
| | 273,903 |
| | 276,339 |
| | 270,703 |
|
Amounts attributable to Cablevision Systems Corporation stockholders: | | | | | | | |
Income from continuing operations, net of income taxes | $ | 33,751 |
| | $ | 56,150 |
| | $ | 187,990 |
| | $ | 308,617 |
|
Income (loss) from discontinued operations, net of income taxes | (1,633 | ) | | (175 | ) | | (12,541 | ) | | 2,822 |
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Net income | $ | 32,118 |
| | $ | 55,975 |
| | $ | 175,449 |
| | $ | 311,439 |
|
Cash dividends declared per share of common stock | $ | 0.00 |
| | $ | 0.15 |
| | $ | 0.45 |
| | $ | 0.60 |
|
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(a) | Income tax expense for the twelve months ended December 31, 2014 includes a tax benefit of $53,132 resulting from the reversal of an uncertain tax position liability. |
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(b) | The Company recorded an expense of $1,626 and $12,380, net of income taxes, during the three and twelve months ended December 31, 2015, with respect to the decision in a case relating to Rainbow Media Holdings LLC, a business whose operations were previously discontinued. |
CABLEVISION SYSTEMS CORPORATION
RECONCILIATION OF OPERATING INCOME TO ADJUSTED OPERATING CASH FLOW AND CONSOLIDATED FREE CASH FLOW FROM CONTINUING OPERATIONS
(Dollars in thousands)
(Unaudited)
RECONCILIATION OF OPERATING INCOME TO ADJUSTED OPERATING CASH FLOW(a)
|
| | | | | | | | | | | | | | | |
| Three Months Ended December 31, | | Twelve Months Ended December 31, |
| 2015 | | 2014 | | 2015 | | 2014 |
| | | | | | | |
Operating income | $ | 197,140 |
| | $ | 205,836 |
| | $ | 848,471 |
| | $ | 921,258 |
|
Share-based compensation | 20,014 |
| | 11,066 |
| | 65,286 |
| | 43,984 |
|
Restructuring expense (credits) | (632 | ) | | 1,950 |
| | (1,649 | ) | | 2,480 |
|
Depreciation and amortization | 215,135 |
| | 222,060 |
| | 865,252 |
| | 866,502 |
|
Adjusted operating cash flow | $ | 431,657 |
| | $ | 440,912 |
| | $ | 1,777,360 |
| | $ | 1,834,224 |
|
CONSOLIDATED FREE CASH FLOW FROM CONTINUING OPERATIONS(a)
|
| | | | | | | |
| Twelve Months Ended December 31, |
| 2015 | | 2014 |
| | | |
| | | |
Net cash provided by operating activities(b) | $ | 1,258,087 |
| | $ | 1,378,271 |
|
Add: excess tax benefits related to share-based awards | 5,694 |
| | 336 |
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Less: capital expenditures(c) | (816,396 | ) | | (891,678 | ) |
Consolidated free cash flow from continuing operations | $ | 447,385 |
| | $ | 486,929 |
|
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(a) | See Non-GAAP Financial Measures on page 4 of this release for a definition and discussion of AOCF and Free Cash Flow from Continuing Operations. |
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(b) | The level of net cash provided by operating activities will continue to depend on a number of variables in addition to our operating performance, including the amount and timing of our interest payments and other working capital items. |
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(c) | See page 12 of this release for additional details relating to capital expenditures. |
CABLEVISION SYSTEMS CORPORATION
CONSOLIDATED RESULTS FROM CONTINUING OPERATIONS
(Dollars in thousands)
(Unaudited)
REVENUES, NET
|
| | | | | | | | | | |
| Three Months Ended December 31, | | % |
| 2015 | | 2014 | | Change |
| | | | | |
Cable | $ | 1,456,036 |
| | $ | 1,454,190 |
| | 0.1 | % |
Lightpath | 91,041 |
| | 90,293 |
| | 0.8 | % |
Other(a) | 91,124 |
| | 96,370 |
| | (5.4 | )% |
Eliminations(b) | (9,223 | ) | | (9,817 | ) | | 6.1 | % |
Total Cablevision | $ | 1,628,978 |
| | $ | 1,631,036 |
| | (0.1 | )% |
|
| | | | | | | | | | |
| Twelve Months Ended December 31, | | % |
| 2015 | | 2014 | | Change |
| | | | | |
Cable | $ | 5,836,188 |
| | $ | 5,784,945 |
| | 0.9 | % |
Lightpath | 364,439 |
| | 352,964 |
| | 3.3 | % |
Other(a) | 347,805 |
| | 361,305 |
| | (3.7 | )% |
Eliminations(b) | (38,689 | ) | | (38,268 | ) | | (1.1 | )% |
Total Cablevision | $ | 6,509,743 |
| | $ | 6,460,946 |
| | 0.8 | % |
| |
(a) | Represents revenues of Newsday, News 12 Networks, Cablevision Media Sales Corporation and certain other entities. |
| |
(b) | Represents inter-segment revenues. |
CABLEVISION SYSTEMS CORPORATION
CONSOLIDATED RESULTS FROM CONTINUING OPERATIONS
(Dollars in thousands)
(Unaudited)
ADJUSTED OPERATING CASH FLOW AND OPERATING INCOME (LOSS)
|
| | | | | | | | | | | | | | | | | | | | | |
| Adjusted Operating Cash Flow | | | | Operating Income (Loss) | | |
| Three Months Ended December 31, | | % | | Three Months Ended December 31, | | % |
| 2015 | | 2014 | | Change | | 2015 | | 2014 | | Change |
| | | | | | | | | | | |
Cable | $ | 434,489 |
| | $ | 441,068 |
| | (1.5 | )% | | $ | 237,839 |
| | $ | 248,708 |
| | (4.4 | )% |
Lightpath | 43,944 |
| | 40,733 |
| | 7.9 | % | | 19,164 |
| | 16,910 |
| | 13.3 | % |
Other(a) | (46,776 | ) | | (40,889 | ) | | (14.4 | )% | | (59,863 | ) | | (59,782 | ) | | (0.1 | )% |
Total Cablevision | $ | 431,657 |
| | $ | 440,912 |
| | (2.1 | )% | | $ | 197,140 |
| | $ | 205,836 |
| | (4.2 | )% |
|
| | | | | | | | | | | | | | | | | | | | | |
| Adjusted Operating
Cash Flow | | | | Operating Income (Loss) | | |
| Twelve Months Ended December 31, | | % | | Twelve Months Ended December 31, | | % |
| 2015 | | 2014 | | Change | | 2015 | | 2014 | | Change |
| | | | | | | | | | | |
Cable | $ | 1,767,500 |
| | $ | 1,833,577 |
| | (3.6 | )% | | $ | 985,448 |
| | $ | 1,064,142 |
| | (7.4 | )% |
Lightpath | 173,022 |
| | 157,516 |
| | 9.8 | % | | 76,637 |
| | 68,295 |
| | 12.2 | % |
Other(a) | (163,162 | ) | | (156,869 | ) | | (4.0 | )% | | (213,614 | ) | | (211,179 | ) | | (1.2 | )% |
Total Cablevision | $ | 1,777,360 |
| | $ | 1,834,224 |
| | (3.1 | )% | | $ | 848,471 |
| | $ | 921,258 |
| | (7.9 | )% |
| |
(a) | Includes unallocated corporate general and administrative costs and the operating results of Newsday, News 12 Networks, Cablevision Media Sales Corporation and certain other entities. |
CABLEVISION SYSTEMS CORPORATION
SUMMARY OF CABLE OPERATING STATISTICS
(Unaudited)
|
| | | | | | | | | | | |
CABLE | December 31, 2015 | | September 30, 2015 | | December 31, 2014 |
| | | | | |
(in thousands) | | | | | |
Total Customers(a) | 3,120 |
| | 3,107 |
| | 3,118 |
|
Video Customers | 2,594 |
| | 2,604 |
| | 2,681 |
|
High-Speed Data Customers | 2,809 |
| | 2,784 |
| | 2,760 |
|
Voice Customers | 2,193 |
| | 2,188 |
| | 2,229 |
|
| | | | | |
| | | | | |
Serviceable Passings (in thousands)(b) | 5,080 |
| | 5,075 |
| | 5,046 |
|
| | | | | |
Penetration | | | | | |
Total Customers to Serviceable Passings | 61.4 | % | | 61.2 | % | | 61.8 | % |
Video Customers to Serviceable Passings | 51.1 | % | | 51.3 | % | | 53.1 | % |
High-Speed Data Customers to Serviceable Passings | 55.3 | % | | 54.9 | % | | 54.7 | % |
Voice Customers to Serviceable Passings | 43.2 | % | | 43.1 | % | | 44.2 | % |
|
| | | | | |
Revenues for the three months ended (dollars in millions) | | | | | |
| | | | | |
Video(c) | $ | 782 |
| | $ | 785 |
| | $ | 788 |
|
High-Speed Data | 375 |
| | 371 |
| | 359 |
|
Voice | 226 |
| | 228 |
| | 230 |
|
Advertising | 38 |
| | 32 |
| | 48 |
|
Other(d) | 35 |
| | 31 |
| | 29 |
|
Total Cable Revenue | $ | 1,456 |
| | $ | 1,447 |
| | $ | 1,454 |
|
|
| | | | | | | | | | | |
Average Monthly Cable Revenue per Customer (“RPC”)(e) | $ | 155.88 |
| | $ | 155.04 |
| | $ | 155.20 |
|
| |
(a) | Represents the number of households/businesses that receive at least one of the Company's services. |
| |
(b) | Includes residential passings, as well as commercial establishments that have connected to our cable distribution network. |
| |
(c) | Includes equipment rental, DVR, franchise fees, video-on-demand and pay-per-view revenue. |
| |
(d) | Includes installation revenue, advertising sales commissions, home shopping and other product offerings. |
| |
(e) | RPC is calculated by dividing average monthly Cable GAAP revenue for the quarter by the average number of total customers for the quarter. |
CABLEVISION SYSTEMS CORPORATION
CAPITALIZATION AND LEVERAGE
(Dollars in thousands)
(Unaudited)
CAPITALIZATION
|
| | | |
| December 31, 2015 |
| |
Cash and cash equivalents | $ | 1,003,279 |
|
| |
Credit facility debt | $ | 2,521,942 |
|
Senior notes and debentures | 5,860,642 |
|
Collateralized indebtedness | 1,191,324 |
|
Capital lease obligations and notes payable | 60,510 |
|
Debt | $ | 9,634,418 |
|
LEVERAGE
|
| | | |
Debt | $ | 9,634,418 |
|
Less: Collateralized indebtedness of unrestricted subsidiaries(a) | 1,191,324 |
|
Cash and cash equivalents | 1,003,279 |
|
Net debt | $ | 7,439,815 |
|
| |
| Leverage Ratios(b) |
Consolidated net debt to AOCF leverage ratio(a)(c) | 4.3x |
|
Restricted Group leverage ratio (Credit Facility Test)(d)(e) | 3.0x |
|
CSC Holdings notes and debentures leverage ratio(e)(f) | 3.2x |
|
Cablevision senior notes leverage ratio(e)(g) | 5.2x |
|
| |
(a) | Collateralized indebtedness is excluded from the leverage calculation because it is viewed as a forward sale of the stock of an unaffiliated company and the Company's only obligation at maturity is to deliver, at its option, the stock or its cash equivalent. |
| |
(b) | Leverage ratios are based on face amount of outstanding debt. |
| |
(c) | AOCF is annualized based on the fourth quarter 2015 results, as reported. |
| |
(d) | Reflects the net debt to cash flow ratio as defined in the CSC Holdings’ credit facility debt agreement (which excludes approximately $2.8 billion of Cablevision’s senior notes and the debt and cash flows related to CSC Holdings’ unrestricted subsidiaries). The annualized AOCF (as defined) used in the Restricted Group leverage ratio was $1.775 billion. |
| |
(e) | Includes CSC Holdings’ guarantee of Newsday LLC’s $480 million senior secured credit facility. |
| |
(f) | Reflects the debt to cash flow ratio applicable under CSC Holdings' senior notes and debentures indentures (which excludes approximately $2.8 billion of Cablevision’s senior notes and the debt and cash flows related to CSC Holdings’ unrestricted subsidiaries). The annualized AOCF (as defined) used in the CSC Holdings' notes and debentures leverage ratio was $1.775 billion. |
| |
(g) | Adjusts the debt to cash flow ratio as calculated under the CSC Holdings' notes and debentures leverage ratio to include approximately $2.8 billion of Cablevision’s senior notes plus $611 million of Cablevision’s senior notes that were contributed to Newsday Holdings LLC. |
CABLEVISION SYSTEMS CORPORATION
CAPITAL EXPENDITURES
(Dollars in thousands)
(Unaudited)
|
| | | | | | | |
| Three Months Ended December 31, |
| 2015 | | 2014 |
| | | |
| | | |
Customer premise equipment | $ | 35,141 |
| | $ | 74,576 |
|
Scalable infrastructure | 69,702 |
| | 66,412 |
|
Line extensions | 7,439 |
| | 6,656 |
|
Upgrade/rebuild | 12,532 |
| | 11,896 |
|
Support | 50,381 |
| | 62,958 |
|
Cable | 175,195 |
| | 222,498 |
|
Lightpath | 25,528 |
| | 28,348 |
|
Other(a) | 11,704 |
| | 10,887 |
|
Total Cablevision | $ | 212,427 |
| | $ | 261,733 |
|
|
| | | | | | | |
| Twelve Months Ended December 31, |
| 2015 | | 2014 |
| | | |
| | | |
Customer premise equipment | $ | 212,350 |
| | $ | 263,466 |
|
Scalable infrastructure | 229,801 |
| | 233,530 |
|
Line extensions | 27,216 |
| | 18,924 |
|
Upgrade/rebuild | 55,694 |
| | 44,024 |
|
Support | 161,319 |
| | 183,580 |
|
Cable | 686,380 |
| | 743,524 |
|
Lightpath | 96,405 |
| | 109,749 |
|
Other(a) | 33,611 |
| | 38,405 |
|
Total Cablevision | $ | 816,396 |
| | $ | 891,678 |
|
| |
(a) | Other primarily includes Newsday, News 12 Networks, Cablevision Media Sales Corporation and Corporate. |
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