Satellite Hurts Mediacom Subscriber Base, Q4 Profits

Feb 22, 2005  •  Post A Comment

Cable operator Mediacom Communications continued to fall victim to the growth of satellite, reporting a 72 percent drop in fourth-quarter profit.

The Middletown, N.Y.-based company posted a fourth-quarter profit of nearly $2 million, versus a year-earlier profit of $7.1 million, amid a 2.5 percent decline in revenue to $207.5 million. For the year, Mediacom swung to a profit of $13.6 million, compared with a year-earlier loss of $62.5 million. Revenue in 2004 increased 5 percent to nearly $1.1 billion.

Mediacom said its basic-cable subscriber base shrank to 1.46 million at the end of the fourth quarter, from 1.54 million in the 2003 period, as 92 percent of its footprint faced direct competition from satellite operators offering local-into-local service.

However, the company was able to post gains in high-speed data customers and advertising revenue, which were up 24 percent and 31 percent in the quarter, respectively. The company also added 14,000 digital-cable subscribers.

Mediacom is also expecting to realize revenue growth from its introduction of telephony, which begins in the second quarter. However, the company said it doesn’t expect the new telephone service to benefit quarterly results until 2006.