ST. LOUIS, Dec. 29, 2011 /PRNewswire/ -- Charter
Communications, Inc. (NASDAQ: CHTR) (along with its
subsidiaries, the "Company" or "Charter") today announced that it
completed the share repurchase program announced on August 9, 2011 by acquiring approximately 4.125
million shares of Charter's Class A common stock for a total of
$200 million, or an average of
$48.48 per share.
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In addition, following approval by a committee of independent
directors of the Board of Directors of Charter advised by UBS
Investment Bank, Charter has agreed to purchase an additional 5.891
million shares in privately negotiated transactions, detailed
below, for a total of $321 million,
or an average of $54.46 per
share. The Company entered into a stock repurchase agreement
with a shareholder to purchase 750,000 shares at $55.18, a 1% discount to the closing price on
December 22, 2011. The Company
subsequently agreed to acquire an aggregate of 5.141 million shares
from certain funds affiliated with Oaktree Capital Management and
Apollo Management Holdings at the price of $54.35 per share, a 3.5% discount to the
December 23, 2011 closing price.
Oaktree Capital Management and Apollo Management Holdings indicated
to Charter that the purpose of the sales was to manage liquidity
needs of certain funds. Following the repurchases, based on
publicly available information, Apollo will continue to
beneficially own 33.541 million shares of Class A common stock
representing 33.26% of the outstanding shares on a beneficial
ownership basis and Oaktree will hold 16.615 million shares or
16.56% of the outstanding shares on a beneficial ownership basis.
The Company expects to close all of the privately negotiated
transactions by December 30,
2011.
Including these privately negotiated transactions, in 2011
Charter will have repurchased a total of 14.5 million shares, or
12.7% of its outstanding shares at the beginning of the year.
Adjusted for share repurchases to be completed through the fourth
quarter, the Company's leverage ratio would have been 4.8 times net
debt to last 12 months proforma Adjusted EBITDA (b) as of
September 30, 2011. The Company
is comfortable with its liquidity and financial profile and
confirms its target leverage range of 4.0-4.5x, and remains
comfortable plus or minus 0.5x for strategic opportunities such as
the repurchases in 2011.
"The repurchases demonstrate Charter's and the Board's
confidence about the Company's future," said Mike Lovett, President and Chief Executive
Officer. "In 2011 we have repurchased 12.7% of the Company's
outstanding shares at an average price of $50.17, which reflects a series of strategic
opportunities to deliver value to our shareholders."
The following schedules are presented in order to reconcile
Adjusted EBITDA (b) and net debt leverage (d), both non-GAAP
measures, to the most directly comparable GAAP measures in
accordance with Section 401(b) of the Sarbanes-Oxley Act.
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CHARTER
COMMUNICATIONS, INC. AND SUBSIDIARIES
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UNAUDITED RECONCILIATION OF NON-GAAP MEASURES TO
GAAP MEASURES
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(DOLLARS IN MILLIONS)
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Pro
Forma
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Last 12
Months Ended (a)
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September 30,
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2011
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Net
loss
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$
(373)
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Plus: Interest
expense, net
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950
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Income tax expense
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303
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Depreciation and amortization
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1,579
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Stock compensation expense
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34
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Loss due to bankruptcy related items
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2
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Loss on extinguishment of debt
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171
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Other, net
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13
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Adjusted
EBITDA (b)
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$
2,679
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September 30,
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2011
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Principal
amount of long-term debt
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$
12,486
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Less: Cash and
cash equivalents (c)
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(32)
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Plus: Fourth
quarter 2011 share repurchases
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405
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Pro Forma
net debt
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$
12,859
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Net debt
leverage (LTM EBITDA) (b), (d)
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4.8x
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(a) Pro forma results reflect certain sales and
acquisitions of cable systems in 2010 and 2011 as if they occurred
as of January 1, 2010.
(b) Adjusted EBITDA is defined as net loss plus net
interest expense, income taxes, depreciation and amortization, loss
realized due to bankruptcy related items, stock compensation
expense, loss on extinguishment of debt and other operating
expenses, such as special charges and 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 our businesses as well as other
non-cash or non-recurring items, and is unaffected by our capital
structure or investment activities.
(c) Cash and cash equivalents includes $27M in restricted
cash as of September 30, 2011.
(d) Net debt leverage is calculated as pro forma net debt
of $12,859M as of September 30, 2011 divided by last 12 months
Adjusted EBITDA (b) of $2,679M as of
September 30, 2011.
About Charter
Charter is a leading broadband communications company and the
fourth-largest cable operator in the
United States. Charter provides a full range of advanced
broadband services, including advanced Charter TV® video
entertainment programming, Charter Internet® access, and Charter
Phone®. Charter Business® similarly provides scalable, tailored,
and cost-effective broadband communications solutions to business
organizations, such as business-to-business Internet access, data
networking, business telephone, video and music entertainment
services, and wireless backhaul. Charter's advertising sales and
production services are sold under the Charter Media® brand. More
information about Charter can be found at charter.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This release includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended
(the "Securities Act"), and Section 21E of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), regarding, among
other things, our plans, strategies and prospects, both business
and financial. Although we believe that our plans, intentions and
expectations 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 Securities and Exchange Commission ("SEC"). Many
of the forward-looking statements contained in this release 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" and "potential," among others. Important
factors that could cause actual results to differ materially from
the forward-looking statements we make in this release are set
forth 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 free cash flow by
offering video, Internet, telephone, advertising and other services
to residential and commercial customers, to adequately meet the
customer experience demands in our markets 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 and the difficult economic conditions in
the United States;
- the impact of competition from other market participants,
including but not limited to incumbent telephone companies, direct
broadcast satellite operators, wireless broadband and telephone
providers, and digital subscriber line ("DSL") providers and
competition from video provided over the Internet;
- general business conditions, economic uncertainty or downturn,
high unemployment levels and the level of activity in the housing
sector;
- 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);
- the effects of governmental regulation on our business;
- 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
release.
SOURCE Charter Communications, Inc.