Mediacom Communications Reports Combined Results for First Quarter 2020

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MEDIACOM COMMUNICATIONS CORPORATION today released combined unaudited financial and operating highlights for the three months ended March 31, 2020.

Mediacom Combined Results for First Quarter 2020*

Revenues were $517.5 million, reflecting a 3.9% increase from the prior year period
Adjusted OIBDA was $205.1 million, reflecting an 4.9% increase from the prior year period
Capital expenditures were $76.7 million, compared to $72.7 million in the prior year period
Free cash flow was $112.6 million, compared to $98.2 million in the prior year period
Ending high-speed data (“HSD”) customers of 1,349,000, a 4.7% increase from March 31, 2019
Ending customer relationships of 1,377,000, a 0.7% increase from March 31, 2019
Net leverage ratio of 2.57x, compared to 2.82x at March 31, 2019
Interest coverage ratio of 12.93x, compared to 7.94x at March 31, 2019

Reference to “Mediacom Combined” reflects the combined results of Mediacom Broadband LLC and Mediacom LLC, eliminating intercompany amounts.

About Mediacom

Mediacom Communications Corporation is the 5th largest cable operator in the U.S. serving almost 1.4 million customers in smaller markets primarily in the Midwest and Southeast. Mediacom offers a wide array of information, communications and entertainment services to households and businesses, including video, high-speed data, phone, and home security and automation. Through Mediacom Business, the company provides innovative broadband solutions to commercial and public sector customers of all sizes, and sells advertising and production services under the OnMedia brand. More information about Mediacom is available at www.mediacomcable.com.

TABLE 1*
Mediacom Communications Corporation
Selected Combined Financial and Operating Data
(Dollars in thousands, except per unit data)
(Unaudited)

	Three Months Ended March 31,
	2020			2019			YoY% Change
High-speed data (“HSD”)	$	223,449		$	201,097		11.1	%
Video		181,294			187,721		(3.4	%)
Phone		29,697			29,426		0.9	%
Business services		70,638			69,407		1.8	%
Advertising		12,398			10,203		21.5	%
Total revenues	$	517,476		$	497,854		3.9	%
Service costs		(216,068	)		(213,062	)	1.4	%
SG&A expenses		(84,975	)		(78,659	)	8.0	%
Management fees		(12,000	)		(11,000	)	9.1	%
OIBDA ^(a)	$	204,433		$	195,133		4.8	%
Non-cash, share based compensation		707			385		83.6	%
Adjusted OIBDA ^(a)	$	205,140		$	195,518		4.9	%
Cash interest expense ^(a)		(15,869	)		(24,629	)	(35.6	%)
Capital expenditures		(76,689	)		(72,659	)	5.5	%
Free cash flow ^(a)	$	112,582		$	98,230		14.6	%

Adjusted OIBDA margin ^(b)		39.6	%		39.3	%


	March 31, 2020			March 31, 2019			YoY% Change
HSD customers		1,349,000			1,288,000		4.7	%
Video customers		693,000			764,000		(9.3	%)
Phone customers		608,000			617,000		(1.5	%)
Primary service units (“PSUs”)		2,650,000			2,669,000		(0.7	%)

HSD customer increases		21,000			24,000
Video customer declines		(17,000	)		(12,000	)
Phone customer (declines) increases		(5,000	)		3,000
Quarterly PSU (declines) increases		(1,000	)		15,000

Customer relationships ^(c)		1,377,000			1,367,000		0.7	%

Average total monthly revenue per:
PSU ^(d)	$	65.08		$	62.35		4.4	%
Customer relationship ^(e)	$	125.91		$	121.84		3.3	%


	March 31, 2020			March 31, 2019
Bank credit facility	$	2,140,000		$	2,147,750
5½% senior notes due 2021	―				200,000
Total debt ^(f)	$	2,140,000		$	2,347,750
Cash		(32,484	)		(145,723	)
Net debt	$	2,107,516		$	2,202,027

Net leverage ratio ^(g)	2.57x			2.82x
Interest coverage ratio ^(h)	12.93x			7.94x

* See Table 4 for information about our use of non-GAAP measures and definitions of OIBDA and free cash flow and Table 5 for footnotes.

TABLE 2*
Mediacom Communications Corporation
Selected Combined Financial and Operating Data
(Dollars in thousands, except per unit data)
(Unaudited)

	Three Months Ended March 31, 2020
	Mediacom Broadband			Mediacom LLC			Eliminations	Mediacom Combined
High-speed data (“HSD”)	$	120,810		$	102,639		―	$	223,449
Video		98,266			83,028		―		181,294
Phone		16,010			13,687		―		29,697
Business services		42,818			27,820		―		70,638
Advertising		10,610			1,788		―		12,398
Total revenues	$	288,514		$	228,962		―	$	517,476
Service costs		(116,492	)		(99,576	)	―		(216,068	)
SG&A expenses		(51,519	)		(33,456	)	―		(84,975	)
Management fees		(7,200	)		(4,800	)	―		(12,000	)
OIBDA ^(a)	$	113,303		$	91,130		―	$	204,433
Investment income from affiliate	―				4,500		(4,500)	―
Non-cash share-based compensation		375			332		―		707
Adjusted OIBDA ^(a)	$	113,678		$	95,962		(4,500)	$	205,140
Cash interest expense ^(a)		(8,048	)		(7,821	)	―		(15,869	)
Capital expenditures		(40,017	)		(36,672	)	―		(76,689	)
Dividend to preferred members		(4,500	)	―			4,500	―
Free cash flow ^(a)	$	61,113		$	51,469		―	$	112,582


	Mediacom Broadband			Mediacom LLC				Mediacom Combined
HSD customers		743,000			606,000				1,349,000
Video customers		380,000			313,000				693,000
Phone customers		335,000			273,000				608,000
Primary service units (“PSUs”)		1,458,000			1,192,000				2,650,000

HSD customer increases		11,000			10,000				21,000
Video customer declines		(9,000	)		(8,000	)			(17,000	)
Phone customer declines		(3,000	)		(2,000	)			(5,000	)
Quarterly PSU declines		(1,000	)	―					(1,000	)

Customer relationships ^(c)		762,000			615,000				1,377,000

Average total monthly revenue per:
PSU ^(d)	$	65.94		$	64.03			$	65.08
Customer relationship ^(e)	$	127.04		$	124.50			$	125.91


	Mediacom Broadband			Mediacom LLC				Mediacom Combined
Bank credit facility	$	1,042,500		$	1,097,500			$	2,140,000
5½% senior notes due 2021	―			―				―
Total debt ^(f)	$	1,042,500		$	1,097,500			$	2,140,000
Cash		(16,957	)		(15,527	)			(32,484	)
Net debt	$	1,025,543		$	1,081,973			$	2,107,516

Net leverage ratio ^(g)	2.26x			2.82x				2.57x
Interest coverage ratio ^(h)	14.13x			12.27x				12.93x

* See Table 4 for information about our use of non-GAAP measures and definitions of OIBDA and free cash flow and Table 5 for footnotes.

TABLE 3*
Mediacom Communications Corporation
Selected Combined Financial and Operating Data
(Dollars in thousands, except per unit data)
(Unaudited)

	Three Months Ended March 31, 2019
	Mediacom Broadband			Mediacom LLC			Eliminations	Mediacom Combined
High-speed data (“HSD”)	$	109,436		$	91,661		―	$	201,097
Video		103,195			84,526		―		187,721
Phone		15,918			13,508		―		29,426
Business services		42,350			27,057		―		69,407
Advertising		8,355			1,848		―		10,203
Total revenues	$	279,254		$	218,600		―	$	497,854
Service costs		(115,399	)		(97,663	)	―		(213,062	)
SG&A expenses		(47,512	)		(31,147	)	―		(78,659	)
Management fees		(6,600	)		(4,400	)	―		(11,000	)
OIBDA ^(a)	$	109,743		$	85,390		―	$	195,133
Investment income from affiliate	―				4,500		(4,500)	―
Non-cash share-based compensation		204			181		―		385
Adjusted OIBDA ^(a)	$	109,947		$	90,071		(4,500)	$	195,518
Cash interest expense ^(a)		(13,087	)		(11,542	)	―		(24,629	)
Capital expenditures		(36,554	)		(36,105	)	―		(72,659	)
Dividend to preferred members		(4,500	)	―			4,500	―
Free cash flow ^(a)	$	55,806		$	42,424		―	$	98,230


	Mediacom Broadband			Mediacom LLC				Mediacom Combined
HSD customers		713,000			575,000				1,288,000
Video customers		422,000			342,000				764,000
Phone customers		342,000			275,000				617,000
Primary service units (“PSUs”)		1,477,000			1,192,000				2,669,000

HSD customer increases		14,000			10,000				24,000
Video customer declines		(6,000	)		(6,000	)			(12,000	)
Phone customer increases		3,000		―					3,000
Quarterly PSU increases		11,000			4,000				15,000

Customer relationships ^(c)		759,000			608,000				1,367,000

Average total monthly revenue per:
PSU ^(d)	$	63.26		$	61.23			$	62.35
Customer relationship ^(e)	$	123.13		$	120.24			$	121.84


	Mediacom Broadband			Mediacom LLC				Mediacom Combined
Bank credit facility	$	1,019,250		$	1,128,500			$	2,147,750
5½% senior notes due 2021		200,000		―					200,000
Total debt ^(f)	$	1,219,250		$	1,128,500			$	2,347,750
Cash		(133,886	)		(11,837	)			(145,723	)
Net debt	$	1,085,364		$	1,116,663			$	2,202,027

Net leverage ratio ^(g)	2.47x			3.10x				2.82x
Interest coverage ratio ^(h)	8.40x			7.80x				7.94x

* See Table 4 for information about our use of non-GAAP measures and definitions of OIBDA and free cash flow and Table 5 for footnotes.

TABLE 4

Use of Non-GAAP Financial Measures

“OIBDA,” “Adjusted OIBDA,” “cash interest expense” and “free cash flow” are not financial measures calculated in accordance with generally accepted accounting principles (“GAAP”) in the United States. We define OIBDA as operating income before depreciation and amortization and Adjusted OIBDA as OIBDA plus investment income from affiliate and excluding non-cash share-based compensation. OIBDA and Adjusted OIBDA may not be comparable to similarly titled measures used by other companies, which may have different depreciation and amortization policies, and are key components in our covenant calculations.

We define cash interest expense as interest expense, net, less amortization of deferred financing costs. Cash interest expense excludes the amortization of financing costs which were paid upon the financing of the relevant debt.

For Mediacom Broadband LLC, we define free cash flow as Adjusted OIBDA less capital expenditures, cash interest expense and dividends to preferred members. For Mediacom LLC, we define free cash flow as Adjusted OIBDA less capital expenditures and cash interest expense. Free cash flow may not be comparable to similarly titled measures reported by other companies.

TABLE 5

Footnotes

^(a)		See Table 4 for information regarding our use of non-GAAP financial measures.
^(b)		Represents Adjusted OIBDA as a percentage of total revenues.
^(c)		Represents the total number of customers that take at least one service, without regard to which service(s) customers purchase.
^(d)		Represents average total monthly revenues for the period divided by average PSUs for such period.
^(e)		Represents average total monthly revenues for the period divided by average customer relationships for such period.
^(f)		Total debt excludes the effect of deferred financing costs, net.
^(g)		Represents net debt at period end divided by annualized Adjusted OIBDA for the period.
^(h)		Represents Adjusted OIBDA divided by cash interest expense for the period.

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