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Despite loss of basic subs, Suddenlink ups revenues in Q4

Fri, 03/11/2011 - 7:25am
Mike Robuck

Suddenlink Communications' fourth-quarter and year-end earnings report fell in line with other recent cable operator results: more revenues despite the continued loss of basic subscribers.

Suddenlink's parent company, Cequel Communications, said this morning that the nation's seventh-largest cable operator saw an 8.7 percent increase in fourth-quarter revenues, for a total of $434.4 million, compared with the same quarter a year ago. For all of last year, Suddenlink's revenues grew 7.7 percent over 2009 to $1.69 billion.

Suddenlink lost 9,800 basic video customers during the fourth quarter, compared with a drain of 15,400 basic video customers during the fourth quarter of 2009, and lost 28,500 basic video customers overall last year.

On the plus side, digital video customers increased by 104,500 during 2010 and grew by 20,500 during the fourth quarter, compared with an increase of 14,300 during the same period in the prior year.

Overall, video revenues increased 2.8 percent, primarily due to basic video rate increases, increased premium and pay-per-view service revenues, and customer growth in digital and advanced video services.

High-speed Internet revenues increased 11 percent, thanks to an increase of 75,500 data customers during 2010 and growth in commercial high-speed Internet services to small- and medium-size businesses.

Residential high-speed Internet customers grew by 12,800 during the fourth quarter, compared with a gain of 18,000 during the fourth quarter of 2009.

Commercial high-speed Internet customers increased by 800 in the fourth quarter, compared with approximately 600 in the fourth quarter of 2009.

Suddenlink's voice revenues were up 24 percent, mainly due to the addition of 78,000 residential telephone customers during 2010 and growth in commercial telephone services to small- and medium-size businesses.

Residential telephone customers grew by 13,000 during the fourth quarter but were down compared with the gain of 27,200 during the fourth quarter a year ago. Commercial telephone customers grew by approximately 1,600 in the fourth quarter, compared with approximately 1,400 in the same quarter a year ago.

Advertising revenues increased 25 percent, driven by higher local and national advertising sales revenues, including political advertising.

Income from operations for the fourth quarter of 2010 was $67.7 million, a decrease of 1.4 percent, compared with $68.6 million for the fourth quarter of 2009 due to increased depreciation expense. Income from operations for 2010 was $254.3 million, an increase of 9.7 percent, compared with $231.9 million for 2009.

Net loss was $43.2 million for 2010, compared with a net loss of $42 million for 2009.

Suddenlink's revenue-generating units (RGUs) increased by 36,500 for the fourth quarter and 229,500 year-over-year, for an 8 percent annual gain. Average monthly revenue per basic video customer for the fourth quarter was $118.41, an increase of 12 percent compared with the fourth quarter of the prior year.

Bundled customers represented 59 percent of total customer relationships, an increase from 54 percent in 2009. Suddenlink said the increase in bundled customers was primarily from growth in triple-play customer relationships, which represented 21 percent of total customer relationships at the end of last year, versus 17 percent the previous year.

"We achieved great success in 2010, growing customer relationships by 6,500 homes while setting company records for net gains in total revenue-generating units and digital video units," said Suddenlink's Chairman and CEO Jerry Kent.

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