COMCAST CORPORATION
TABLE 1
Condensed Consolidated Statement of Operations (Unaudited)
(amounts in millions, except per share data)
Three Months Ended
March 31,
2006 2005
Revenues $5,901 $5,363
Operating expenses 2,196 1,957
Selling, general and
administrative expenses 1,504 1,376
3,700 3,333
Operating Cash Flow 2,201 2,030
Depreciation expense 932 874
Amortization expense 219 290
1,151 1,164
Operating Income 1,050 866
Other Income (Expense)
Interest expense (476) (444)
Investment income (loss), net 64 (36)
Equity in net (losses) income of
affiliates (10) 12
Other income (expense) 12 (108)
(410) (576)
Income before Income Taxes
and Minority Interest 640 290
Income tax expense (164) (140)
Income Before Minority Interest 476 150
Minority interest (10) (7)
Net Income $466 $143
Net Income per common share $0.22 $0.06
Basic weighted average number of
common shares 2,135 2,214
Diluted weighted average number of
common shares 2,142 2,222
COMCAST CORPORATION
TABLE 2
Condensed Consolidated Balance Sheet (Unaudited)
(dollars in millions)
March 31, December 31,
ASSETS 2006 2005
CURRENT ASSETS
Cash and cash equivalents $1,693 $693
Investments 819 148
Accounts receivable, net 910 1,060
Other current assets 576 693
Total current assets 3,998 2,594
INVESTMENTS 12,018 12,682
PROPERTY AND EQUIPMENT, net 18,709 18,769
FRANCHISE RIGHTS 51,086 51,090
GOODWILL 13,620 14,218
OTHER INTANGIBLE ASSETS, net 2,999 3,160
OTHER NONCURRENT ASSETS, net 552 633
$102,982 $103,146
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued
expenses related to trade
creditors $1,940 $2,033
Accrued expenses and other
current liabilities 2,640 2,545
Deferred income taxes 239 2
Current portion of long-term
debt 881 1,689
Total current liabilities 5,700 6,269
LONG-TERM DEBT, less current
portion 23,249 21,682
DEFERRED INCOME TAXES 26,918 27,370
OTHER NONCURRENT LIABILITIES 6,427 6,949
MINORITY INTEREST 662 657
STOCKHOLDERS' EQUITY 40,026 40,219
$102,982 $103,146
COMCAST CORPORATION
TABLE 3
Condensed Consolidated Statement of Cash Flows (Unaudited)
(dollars in millions)
Three Months Ended
March 31,
2006 2005
OPERATING ACTIVITIES
Net cash provided by operating
activities $1,722 $1,332
FINANCING ACTIVITIES
Proceeds from borrowings 2,242 225
Retirements and repayments of debt (1,457) (112)
Repurchases of common stock (710) (326)
Issuances of common stock 12 40
Other (9) 38
Net cash provided by (used in)
financing activities 78 (135)
INVESTING ACTIVITIES
Capital expenditures (878) (892)
Cash paid for intangible assets (69) (112)
Proceeds from sales and
restructuring of investments 189 100
Purchases of investments (48) (40)
Proceeds from sales (purchases) of
short-term investments, net 4 (1)
Other investing activities 2 (68)
Net cash used in investing
activities (800) (1,013)
INCREASE IN CASH AND CASH
EQUIVALENTS 1,000 184
CASH AND CASH EQUIVALENTS, beginning
of period 693 452
CASH AND CASH EQUIVALENTS, end of
period $1,693 $636
TABLE 4
Calculation of Free Cash Flow (Unaudited) (1)
(dollars in millions)
Three Months Ended
March 31,
2006 2005
Net Cash Provided by Operating
Activities $1,722 $1,332
Capital Expenditures (878) (892)
Cash paid for Intangible Assets (69) (112)
Free Cash Flow $775 $328
(1) See Non-GAAP and Other Financial Measures in Table 7 for the
definition of Free Cash Flow.
COMCAST CORPORATION
TABLE 5
Financial Data by Business Segment (Unaudited) (1)
(dollars in millions)
Corporate
and
Cable Content (2) Other Total
Three Months Ended March 31, 2006
Revenues $5,588 $239 $74 $5,901
Operating Cash Flow $2,215 $50 ($64) $2,201
Operating Income (Loss) $1,126 $9 ($85) $1,050
Operating Cash Flow Margin 39.6% 20.8% NM 37.3%
Capital Expenditures (3) $864 $8 $6 $878
Three Months Ended March 31, 2005,
as adjusted (4)
Revenues $5,106 $213 $44 $5,363
Operating Cash Flow $1,970 $76 ($55) $1,991
Operating Income (Loss) $866 $31 ($70) $827
Operating Cash Flow Margin 38.6% 35.7% NM 37.1%
Capital Expenditures (3) $883 $4 $5 $892
(1) See Non-GAAP and Other Financial Measures in Table 7. Historical
financial data by business segment, as required under generally accepted
accounting principles, is available in the Company's quarterly report on
Form 10-Q. All percentages are calculated based on actual amounts. Minor
differences may exist due to rounding.
(2) Content includes our national networks E! Entertainment Television
and Style Network (E! Networks), The Golf Channel, OLN, G4 and AZN
Television.
(3) Our Cable segment's capital expenditures are comprised of the
following categories:
1Q06 1Q05
New Service Offerings
Customer Premise Equipment (CPE) $468 $463
Scalable Infrastructure 172 209
640 672
Recurring Capital Projects
Line Extensions 73 64
Support Capital 91 47
164 111
Upgrades 60 100
Total $864 $883
CPE includes costs incurred at the customer residence to secure new
customers, revenue units and additional bandwidth revenues (e.g. digital
converters). Scalable infrastructure includes costs, not CPE or network
related, to secure growth of new customers, revenue units and additional
bandwidth revenues or provide service enhancements (e.g. headend
equipment). Line extensions include network costs associated with
entering new service areas (e.g. fiber/coaxial cable). Support capital
includes costs associated with the replacement or enhancement of non-
network assets due to obsolescence and wear out (e.g. non-network
equipment, land, buildings and vehicles). Upgrades include costs to
enhance or replace existing fiber/coaxial cable networks, including
recurring betterments.
(4) Adjusted as if stock options had been expensed in 2005. See Table
7-A for Reconciliation of "As Adjusted" Financial Data.
COMCAST CORPORATION
TABLE 6
Pro Forma Data - Cable Segment Components (Unaudited) (1) (2)
(dollars in millions, except per subscriber and per unit data)
Three Months Ended
March 31,
2006 2005
Revenues:
Video (3) $3,576 $3,362
High-Speed Internet 1,131 925
Phone 191 175
Advertising 309 296
Other (4) 206 181
Franchise Fees 175 167
Total Revenues $5,588 $5,106
Operating Cash Flow (5) $2,215 $1,970
Operating Income (5) $1,126 $866
Operating Cash Flow Margin (5) 39.6% 38.6%
Capital Expenditures $864 $883
Annualized Capital Expenditures per
Basic Subscriber $161 $164
Annualized Capital Expenditures per
Revenue Generating Unit $82 $91
1Q06 1Q05 4Q05
Video
Homes Passed (000's) 41,800 41,000 41,600
Basic Subscribers (000's) 21,495 21,532 21,449
Basic Penetration 51.4% 52.6% 51.5%
Quarterly Net Basic Subscriber
Additions (000's) 47 (29) 40
Digital Subscribers (000's) 10,129 8,856 9,789
Digital Penetration 47.1% 41.1% 45.6%
Quarterly Net Digital Subscriber
Additions (000's) 340 200 342
Digital Set-Top Boxes 15,657 13,365 15,052
Monthly Average Video Revenue per
Basic Subscriber $55.51 $52.02 $53.29
Monthly Average Total Revenue per
Basic Subscriber $86.75 $79.00 $84.16
High-Speed Internet
"Available" Homes (000's) 41,399 40,483 41,249
Subscribers (000's) 8,957 7,408 8,520
Penetration 21.6% 18.3% 20.7%
Quarterly Net Subscriber
Additions (000's) 437 414 378
Monthly Average Revenue per
Subscriber $43.14 $42.81 $42.38
Phone
Comcast Digital Voice
"Available" Homes (000's) 18,883 1,156 16,290
Subscribers (000's) 416 9 204
Penetration 2.2% 0.8% 1.3%
Quarterly Net Subscriber
Additions (000's) 211 7 134
Circuit Switched Phone
"Available" Homes (000's) 10,623 10,121 10,245
Subscribers (000's) 1,047 1,219 1,117
Penetration 9.9% 12.0% 10.9%
Quarterly Net Subscriber
Additions (000's) (70) (3) (55)
Monthly Average Total Phone Revenue
per Subscriber $45.70 $47.69 $45.73
Total Revenue Generating Units
(000's) (6) 42,044 39,024 41,079
Quarterly Net Additions 965 589 839
(1) See Non-GAAP and Other Financial Measures in Table 7. All
percentages are calculated based on actual amounts. Minor differences
may exist due to rounding.
(2) Pro forma subscriber data also includes 13,000 subscribers acquired
in various small acquisitions during 2005. The impact of these
acquisitions on our segment operating results was not material.
(3) Video revenues consist of our basic, expanded basic, premium, pay-
per-view, equipment and digital services.
(4) Other revenues include installation revenues, guide revenues,
commissions from electronic retailing, other product offerings,
commercial data services and revenues of our digital media center and
regional sports programming networks.
(5) Adjusted as if stock options had been expensed in 2005.
(6) The total of all basic video, digital video, high-speed Internet
and net phone subscribers, excluding additional outlets.
COMCAST CORPORATION
TABLE 7
Non-GAAP and Other Financial Measures
|
Operating Cash Flow is the primary basis used to measure the operational
strength and performance of our businesses. Free Cash Flow is an
additional performance measure used as an indicator of our ability to
repay debt, make investments and return capital to investors, principally
through stock repurchases. We also adjust certain historical data on a pro
forma basis following significant acquisitions or dispositions to enhance
comparability.
Operating Cash Flow is defined as operating income before depreciation and
amortization, excluding impairment charges related to fixed and intangible
assets and gains or losses on sale of assets, if any. As such, it
eliminates the significant level of non-cash depreciation and amortization
expense that results from the capital intensive nature of our businesses
and intangible assets recognized in business combinations, and is
unaffected by our capital structure or investment activities. Our
management and Board of Directors use this measure in evaluating our
consolidated operating performance and the operating performance of all of
our operating segments. This metric is used to allocate resources and
capital to our operating segments and is a significant component of our
annual incentive compensation programs. We believe that Operating Cash
Flow is also useful to investors as it is one of the bases for comparing
our operating performance with other companies in our industries, although
our measure of Operating Cash Flow may not be directly comparable to
similar measures used by other companies.
As Operating Cash Flow is the measure of our segment profit or loss, we
reconcile it to operating income, the most directly comparable financial
measure calculated and presented in accordance with Generally Accepted
Accounting Principles (GAAP), in the business segment footnote of our
quarterly and annual financial statements. Therefore, we believe our
measure of Operating Cash Flow for our business segments is not a "non-
GAAP financial measure" as contemplated by Regulation G adopted by the
Securities and Exchange Commission. Consolidated Operating Cash Flow is a
non-GAAP financial measure.
Beginning in 2006, we changed our definition of Free Cash Flow, which is a
non-GAAP financial measure, to mean "Net Cash Provided by Operating
Activities From Continuing Operations" (as stated in our Consolidated
Statement of Cash Flows) reduced by capital expenditures and cash paid for
intangible assets; and increased by any payments related to certain non-
operating items, net of estimated tax benefits (such as income taxes on
investment sales, and non-recurring payments related to income tax and
litigation contingencies of acquired companies). We believe that Free
Cash Flow is also useful to investors as it is one of the bases for
comparing our performance with other companies in our industries, although
our measure of Free Cash Flow may not be comparable to similar measures
used by other companies.
Pro forma data is used by management to evaluate performance when
significant acquisitions or dispositions occur. Historical data reflects
results of acquired businesses only after the acquisition dates while pro
forma data enhances comparability of financial information between periods
by adjusting the data as if the acquisitions (or dispositions) occurred at
the beginning of the prior year. Our pro forma data is only adjusted for
the timing of acquisitions and does not include adjustments for costs
related to integration activities, cost savings or synergies that have
been or may be achieved by the combined businesses. There were no
significant acquisitions or dispositions causing pro forma adjustments to
operating results in the first quarter of 2006. We believe our pro forma
data is not a non-GAAP financial measure as contemplated by Regulation G.
In certain circumstances we also present data, as adjusted, in order to
enhance comparability between periods. In connection with the adoption of
FAS 123R, we have adjusted 2005 data as if stock options had been
expensed.
Operating Cash Flow and Free Cash Flow should not be considered as
substitutes for operating income (loss), net income (loss), net cash
provided by operating activities or other measures of performance or
liquidity reported in accordance with GAAP. Additionally, in the opinion
of management, our pro forma data is not necessarily indicative of future
results or what results would have been had the acquired businesses been
operated by us after the assumed earlier date.
We provide reconciliations of Consolidated Operating Cash Flow in Table 1,
Free Cash Flow in Table 4 and "as adjusted" in Table 7A.
COMCAST CORPORATION
TABLE 7-A
Reconciliation of "As Adjusted" Financial Data
(dollars in millions)
Three Months Ended
March 31,
2005 2006
% Growth
Historical Adjustment As As
Total (1) Adjusted Total Adjusted % Growth
Revenue $5,363 - $5,363 $5,901 10% 10%
Operating Expenses
(excluding
depreciation and
amortization) 3,333 39 3,372 3,700
Operating Cash Flow $2,030 ($39) $1,991 $2,201 11% 8%
Depreciation and
Amortization $1,164 - $1,164 $1,151
Operating Income
(Loss) $866 ($39) $827 $1,050 27% 21%
Operating Cash Flow
Margin 37.9% NM 37.1% 37.3%
Earnings per Share $0.06 ($0.01) $0.05 $0.22 340% 267%
(1) To be consistent with our management reporting, 2005 has been adjusted
as if stock options had been expensed as of January 1, 2005. The
adjustment by segment is $26 million for Cable, $1 million for Content and
$12 million for Corporate and Other.
|
|
