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Charter Reports Q3 Profit Loss

Nov 4, 2004  •  Post A Comment

Paul Allen’s Charter Communications on Thursday swung to steep third-quarter loss, as the debt-laden cable company booked charges related to the reduced value of certain systems and warned that it will need additional funding to pay back debt maturing in 2005 and 2006.

The St. Louis-based company booked a loss of $3.3 billion, compared with a year-earlier profit of $37 million. The numbers reflected a $2.3 billion impairment charge booked to reflect a lower projected growth of certain cable systems as well as an 8 percent increase to $777 million of operating costs and expenses.

At the same time Charter reported an 8 percent increase in revenue to $1.3 billion, which came as the company added 108,500 high-speed data customers. The company also reported growth in high-definition television and telephony subscriptions and reversed a second-quarter decline in digital cable subscriptions by adding 38,700 new customers in the third quarter.

However, the company saw the number of basic analog cable subscribers shrink by 58,000 in the quarter, continuing a trend that has taken place for the last three quarters.

Meanwhile, Charter said it was examining its options to address the funding shortfall, and said it would explore asset sales as well as a host of other strategies that would generate funds and enable it to pay off the debt coming due. The company added that while Mr. Allen has bailed out the company in the past there was no guarantee he would do the same this time around.