Adelphia restates subscriber numbers
Copyright 2003 The Times Mirror Company; Los Angeles Times
All Rights Reserved
Los Angeles Times
May 28, 2003 Wednesday Home Edition
Adelphia Communications Corp., the cable television operator that is operating under Bankruptcy Court protection, restated the number of its basic cable, digital cable and high-speed Internet subscribers reported last year after a review of company accounting practices.
In a Securities and Exchange Commission filing, Adelphia cut subscriber counts for each of the first three quarters of 2002. The firm reported subscriber figures in a regulatory filing in October. It previously disclosed that it had overstated revenue and cash flow over a two-year period.
Under new management since the ouster of founder John Rigas and his family, Adelphia is trying to emerge from an accounting scandal that led it to file for Chapter 11 in June. The restatements disclosed Tuesday stem from changes that the company said it made to comply with more commonly accepted practices in the industry.
"It's a move toward a more conservative set of accounting practices," Adelphia spokesman Eric Andrus said.
Adelphia, which moved its headquarters last month to Greenwood Village, Colo., from the Rigas' hometown of Coudersport, Pa., said it stopped counting households with more than one digital-cable decoder box or cable modem as additional subscribers.
That lowered the number of digital customers by more than 30 percent in the quarters ended in March, June and September 2002 to 1.5 million, 1.63 million and 1.69 million, respectively. The company had a total of about 1.84 million digital customers on March 31 of this year.
High-speed Internet users were reduced by less than 1 percent to 396,016, 489,718 and 553,178 customers for the 2002 periods. Adelphia ended March with 711,736 users. The company said it had not yet completed restatements for 1999 through 2001.
The company also reduced its basic-cable subscriber base after changing how it accounts for bulk billing arrangements, which typically apply to apartments where cable service is included in the rent. Adelphia collects a flat fee from landlords that covers every resident, regardless of whether each unit is occupied.
Under that approach, the company would count every apartment in a 100-unit building as a customer even when fewer were occupied. In today's filing, Adelphia said it would use an "equivalent" method for calculating subscribers. That approach divides the total fee by the average rate a customer in that area pays to arrive at a more conservative figure.
The company lowered its basic-cable count by less than 1 percent, or about 26,000 customers, in each quarter. The company had a total of 5.3 million basic customers on March 31.