Charter Communications Loss Widens on Merger Costs
February 04 2016 - 8:30AM
Dow Jones News
Charter Communications Inc. posted a deeper-than-expected loss
in the final quarter of the year on expenses related to its
proposed mergers with Time Warner Cable and Bright House Networks
LLC.
Shares of the company declined 3.4% premarket to $170.50.
Internet revenue shot up 17% to $781 million in the latest
quarter, helped by an additional 442,000 Internet customers added
during the past year and by fewer promotions, higher prices and
more revenue from bundling its services together.
Commercial revenue rose 12% to $294 million, driven by small and
medium business and enterprise revenue growth.
Video revenue grew 2.9% to $1.2 billion in the fourth quarter,
driven by higher advanced services penetration, annual and
promotional rate adjustments and an increase in expanded basic and
digital customers, partially offset by a decrease in residential
limited basic video customers. Charter reported it added 29,000
residential video customers in the period, versus a loss of 3,000 a
year before.
Voice revenue, meanwhile, fell 2.7% to $135 million.
Overall, Charter posted a loss of $122 million, or $1.09 a
share, compared with a year-earlier loss of $48 million, or 44
cents a share. The wider loss was driven by a $231 million interest
expense related to the financing of Charter's pending transactions
with Time Warner and Bright House.
Revenue grew 6.4% to $2.51 billion.
Analysts had expected a loss of 29 cents a share on revenue of
$2.53 billion.
Charter is trying to win regulatory approval for its $55 billion
cash-and-stock deal to buy Time Warner Cable as well as smaller
operator Bright House. The deal was struck only a month after Time
Warner Cable went back on the block after Comcast in April
terminated the companies' planned $45.2 billion merger in the face
of serious pushback from Washington regulators.
Charter could eventually use its larger size to push back on big
TV channel owners, like Time Warner Inc.'s HBO, as they experiment
with new Web products outside of the TV bundle.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
February 04, 2016 09:15 ET (14:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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