Charter Announces 4th Quarter 2019 Results.

STAMFORD, Conn: Charter Communications, Inc. (along with its subsidiaries, the "Company" or "Charter") today reported financial and operating results for the three and twelve months ended December 31, 2019.

Key highlights:

Fourth quarter total residential and SMB customer relationships increased by 268,000, compared to 248,000 during the fourth quarter of 2018. Fourth quarter total residential and SMB Internet customers increased by 339,000, compared to 329,000 during the fourth quarter of 2018.

During the year ended December 31, 2019, total residential and SMB customer relationships grew by 1.1 million, or 4.0% to 29.2 million, and total residential and SMB Internet customers grew by 1.4 million, or 5.6% to 26.7 million.

Charter added 288,000 Spectrum MobileTM lines in the fourth quarter and as of December 31, 2019, Charter served a total of 1.1 million mobile lines, with 948,000 mobile lines added in 2019.

Fourth quarter revenue of $11.8 billion grew by 4.7% year-over-year, driven by residential revenue growth of 5.7%, mobile revenue growth of $147 million and SMB revenue growth of 6.3%.

Fourth quarter Adjusted EBITDA1 of $4.5 billion grew by 8.8% year-over-year, while fourth quarter cable Adjusted EBITDA1 of $4.7 billion grew by 8.9% year-over-year.

For the year ended December 31, 2019, revenue of $45.8 billion increased by 4.9% year-over-year. Full year 2019 Adjusted EBITDA totaled $16.9 billion, 5.0% higher than in 2018, while cable Adjusted EBITDA of $17.4 billion grew by 6.6% year-over-year.

Net income attributable to Charter shareholders totaled $714 million in the fourth quarter, compared to $296 million during the same period last year. For the year ended December 31, 2019, net income attributable to Charter shareholders totaled $1.7 billion, compared to $1.2 billion in 2018.

Fourth quarter capital expenditures totaled $2.3 billion and included $151 million of mobile-related capital expenditures. For the year ended December 31, 2019, capital expenditures totaled $7.2 billion, down from $9.1 billion in 2018, and included $432 million of mobile-related capital expenditures.

For the year 2019, consolidated free cash flow1 totaled $4.6 billion, compared to $2.2 billion in 2018. Cable free cash flow1 totaled $5.8 billion for the full year 2019, versus $2.8 billion in 2018.

During the fourth quarter, Charter purchased approximately 5.6 million shares of Charter Class A common stock and Charter Communications Holdings, LLC ("Charter Holdings") common units for approximately $2.6 billion. For the year ended December 31, 2019, Charter purchased 19.0 million shares of Charter Class A common stock and Charter Holdings common units for approximately $7.6 billion.

"Our operating strategy continues to deliver strong results and in 2019, we created over 1.1 million new customer relationships, substantially more than in 2018. And we added over 1.4 million new Internet customers, also more than in 2018," said Tom Rutledge, Chairman and CEO of Charter Communications. "As we look to 2020, we remain focused on driving customer growth by offering superior services and value to our customers, improving the efficiency of our operations, and delivering sustainable free cash flow growth, by driving EBITDA growth, while reducing capital intensity."

  1. Adjusted EBITDA, cable Adjusted EBITDA, free cash flow and cable 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

December 31,

2019 (a)

December 31,

2018 (a)

Y/Y Change

Footprint (b)

Estimated Passings

52,154

51,185

1.9

%

Penetration Statistics (c)

Total Customer Relationship Penetration of Estimated Passings

56.1

%

54.9

%

1.2

ppts

Customer Relationships (d)

Residential

27,277

26,270

3.8

%

Small and Medium Business

1,958

1,833

6.8

%

Total Customer Relationships

29,235

28,103

4.0

%

Quarterly Net Additions (Losses)

Residential

240

207

16.2

%

Small and Medium Business

28

41

(33.3)

%

Total Customer Relationships

268

248

8.1

%

Residential

Primary Service Units ("PSUs")

Video

15,620

16,104

(3.0)

%

Internet

24,908

23,625

5.4

%

Voice

9,443

10,135

(6.8)

%

Quarterly Net Additions (Losses)

Video

(105)

(36)

(184.9)

%

Internet

313

289

8.1

%

Voice

(152)

(83)

(83.9)

%

Single Play (e)

11,741

10,928

7.4

%

Double Play (e)

8,377

7,097

18.0

%

Triple Play (e)

7,159

8,245

(13.2)

%

Single Play Penetration (f)

43.0

%

41.6

%

1.4

ppts

Double Play Penetration (f)

30.7

%

27.0

%

3.7

ppts

Triple Play Penetration (f)

26.2

%

31.4

%

(5.2)

ppts

% Residential Non-Video Customer Relationships

42.7

%

38.7

%

4.0

ppts

Monthly Residential Revenue per Residential Customer (g)

$113.79

$111.78

1.8

%

Small and Medium Business

PSUs

Video

524

502

4.4

%

Internet

1,756

1,634

7.5

%

Voice

1,144

1,051

8.8

%

Quarterly Net Additions (Losses)

Video

4

14

(71.7)

%

Internet

26

40

(32.2)

%

Voice

24

27

(14.2)

%

Monthly Small and Medium Business Revenue per Customer (h)

$169.06

$170.62

(0.9)

%

Mobile Lines

Residential and Small and Medium Business Mobile Lines

1,082

134

713.3

%

Net Additions (Losses)

288

113

156.0

%

Enterprise PSUs (i)

Enterprise PSUs

267

248

7.6

%

Net Additions (Losses)

3

5

(40.5)

%

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 fourth quarter of 2019, Charter's residential customer relationships grew by 240,000, while fourth quarter 2018 residential customer relationships grew by 207,000. As of December 31, 2019, Charter had 27.3 million residential customer relationships, with year-over-year growth of 1.0 million, or 3.8%.

Charter added 313,000 residential Internet customers in the fourth quarter of 2019, versus fourth quarter 2018 residential Internet customer net additions of 289,000. As of December 31, 2019, Charter had 24.9 million residential Internet customers, with 85% subscribing to tiers that provided 100 Mbps or more of speed. Over the course of 2019, Charter doubled minimum Internet speeds in a number of markets at no additional cost to new and existing Spectrum Internet(r) customers. Currently, 200 Mbps is the slowest speed offered to new Internet customers in approximately 60% of Charter's footprint, with 100 Mbps the slowest speed offered in the remaining 40% of its footprint.

Residential video customers decreased by 105,000 in the fourth quarter of 2019, while fourth quarter 2018 residential video customers decreased by 36,000. As of December 31, 2019, Charter had 15.6 million residential video customers.

During the fourth quarter of 2019, residential wireline voice customers declined by 152,000, while fourth quarter 2018 voice customers declined by...

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