Mediacom’s Q4 losses balloon
Mediacom reported that fourth-quarter revenue was up 6.2 percent from a year ago, to $332.5 million. But increased service costs led to a loss that increased by an order of magnitude, from $3.6 million in Q4 2006 to $36.9 million in Q4 2007.
The offset of basic subscriber loss is diminishing. The company lost 7,000 basic subscribers, compared with a loss of 14,000 for the same period last year.
Digital customers grew by 16,000, for a total of 557,000 customers at the end of 2007 – a 42 percent penetration rate of basic subscribers. Mediacom said 29 percent of digital customers received DVR and/or high-definition television (HDTV) services, up from 20 percent at the end of 2006.
Data customers grew by 22,000, to end the year with 658,000. Phone customers grew by 20,000 for a year-end total of 185,000. In total, the company increased the number of revenue generating units (RGUs) by 51,000 during the quarter.
Average monthly revenue per basic subscriber increased 11 percent, to $83.49, due in part to higher service fees from advanced video products and services, including DVRs and HDTV, and basic video rate increases.
Mediacom Chairman Rocco B. Commisso said: "In 2008, we plan to make greater investments in our cable network, mainly to ready ourselves for the digital transition in February 2009. However, even after increased capital spending, we see an improvement of about $18 million in free cash flow relative to 2007, as we expect a meaningful reduction in interest expense.”
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