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Cablevision Lags on Q4 Earnings, Tops Revs

T CVC VZ CMCSA

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Cablevision Systems Corp. (CVC - Snapshot Report) reported mixed financial results for the fourth quarter of 2013. While total revenue surpassed the Zacks Consensus Estimate, net income fell below the same.

Nevertheless, the company improved its video churn rate. Management forecasted that adjusted operating cash flow is expected to grow at high-single digit to low-double digit percentage in the ensuing first quarter of 2014. For fiscal 2014, the company also expects some cash flow growth. Cablevision Systems currently has a Zacks Rank #3 (Hold).

Total revenue, in the fourth quarter of 2013 was $1,583.5 million, up 4.5% year over year also outpaced the Zacks Consensus Estimate of $1,573 million.

Quarterly GAAP net income from continuing operations was $46.5 million or 17 cents per share compared with a net loss of $73.9 million or 28 cents per share in the prior-year quarter. However, fourth-quarter adjusted earnings per share of 8 cents were a penny shy of the Zacks Consensus Estimate.

Quarterly operating income was $168.7 million against $30.9 million in the last year’s comparable quarter. Operating margin was 10.7% compared with 2% in the prior-year quarter. Quarterly average monthly cable revenue per customer was $147.34 compared with $137.51 in the year-ago quarter. Average monthly cable revenue per video customer was $166.66 against $153.22 in the prior-year quarter.

During 2013, Cablevision generated approximately $1,135 million of cash from operations against $1,061.2 million in 2012. Free cash flow, in 2013 was $184.5 million against $69.6 million in 2012. At the end of 2013, the company had $702.2 million of cash and cash equivalents and $8,239.1 million of net outstanding debt.

Segment Wise Revenues

The Cable segment’s revenues stood at $1,410.9 million, up 5.2% year over year. Within this segment, Video revenues were $792 million, up 3.7% year over year. High-Speed data revenues were $339 million, up 12.3% year over year. Voice revenues were $211 million, up 1.9% year over year. Advertising revenues totaled $44 million, up 2.3% year over year. Other revenues were $25 million, remaining same year over year.

The Lightpath segment’s revenues came in at $85 million, up 3.9% year over year. Other revenues were $97 million, down 4.9% year over year. 

Subscribers Statistics

As on Dec 31, 2013, Cablevision had 2.813 million video subscribers, 2.78 million high-speed data subscribers and 2.272 million voice subscribers. In the reported quarter, the company lost 18,000 video subscribers but gained 6,000 high-speed data subscribers.

Cablevision is facing fierce competition from the fiber-based Fios video offerings of Verizon Communications Inc. (VZ - Analyst Report). Apart from Comcast Corp. (CMCSA - Analyst Report), all other cable TV operators are facing the brunt of fiber-based video offerings of Verizon and AT&T Inc. (T - Analyst Report). 

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