Comcast Reports Second Quarter Results
Philadelphia, PA.
Comcast Corporation today reported results for the three and six months ended June 30, 1999. For the three months ended June 30, 1999, the Company reported consolidated revenues of $1.479 billion, a 22.6% increase from the $1.206 billion reported in the second quarter of 1998. Consolidated operating cash flow, a key indicator of the Company's performance, increased 29.4% to $457.3 million from the $353.3 million reported in the same period in 1998. On a pro forma basis, the Company's consolidated revenues and operating cash flow for the quarter ended June 30, 1999 would have increased by 14.0% and 16.0%, respectively, over the prior year quarter.
For the six months ended June 30, 1999, the Company reported consolidated revenues of $2.853 billion and consolidated operating cash flow of $882.5 million, as compared to revenues and operating cash flow of $2.460 billion and $702.0 million, respectively, for the same period in 1998. On a pro forma basis, the Company's consolidated revenues and operating cash flow for the six months ended June 30, 1999 would have increased by 13.9% and 18.3%, respectively, over the same 1998 period.
The Company's second quarter results treat Comcast Cellular Corporation as a discontinued operation for all periods presented due to the sale of Comcast Cellular to SBC Communications, Inc. in July 1999. The Company's second quarter results include the financial results of Jones Intercable, Inc., in which the Company acquired a controlling interest on April 7, 1999 and also include the effects of the $1.5 billion breakup fee received as a result of the termination of the MediaOne Merger Agreement. The pro forma results discussed in this press release assume that the Company's acquisitions and divestitures were effective January 1, 1998. The historical results discussed in this press release include the results of the acquired operations from the dates of acquisition and exclude the results of the divested operations from the dates of divestiture.
Brian L. Roberts, president of Comcast, said, "This has been a terrific quarter for our Company as we completed a number of cable transactions, the most significant of which was the acquisition of a controlling interest in Jones Intercable. These transactions are transforming Comcast into one of the most regionally-focused companies in the cable industry and position the Company as a powerful competitor in the broadband services market."
Mr. Roberts continued, "Each of our businesses posted double-digit operating cash flow growth. Comcast Cable's pro forma operating cash flow growth of 10.5% demonstrates the continuing strength of this business as we deliver a broader array of services to our customers. Today, Comcast Digital Cable has more than 285,000 customers, and our Comcast @Home high-speed Internet access service has over 100,000 customers."
Mr. Roberts added, "QVC continues to prove its leadership in electronic retailing with 31% growth in operating cash flow. We are delivering valued products and outstanding customer satisfaction through our TV channels in the U.S., the U.K. and Germany as well as via the Internet. In a recent Harris Interactive survey, iQVC scored the highest customer satisfaction ratings among e-commerce shoppers in four of eleven product categories. In Germany, our electronic shopping channel now covers over 15 million homes and we are committing to expansion plans to support the next level of growth in this large and dynamic market."
On a pro forma basis, cable division revenues for the three months ended June 30, 1999 were $748.9 million, representing an 8.2% increase from the $692.0 million for the same period in 1998. Pro forma operating cash flow for the quarter increased by 10.5%, excluding the effects of certain one-time adjustments recorded by the Company in the second quarter to the results of Jones Intercable, Inc. Reported pro forma operating cash flow after such one-time adjustments was $343.4 million, an increase of 8.2% over the $317.5 million for the same period in 1998. Pro forma cable division revenues increased by 8.8% for the six months ended June 30, 1999 over the same period in 1998. Pro forma operating cash flow for the six-months ended June 30, 1999 increased by 10.6% and 9.4%, before and after one-time adjustments, respectively, over the same 1998 period.
During the second quarter, the cable division continued to expand delivery of its Comcast Digital Cable service, ending the quarter with 225,900 digital cable customers, up nearly 92,000 for the quarter. Today, Comcast Digital Cable is available to more than 60% of the Company's cable customers. The cable division also expanded delivery of Comcast@Home high-speed Internet access service, adding more than 20,800 customers during the quarter for a total of more than 94,200 customers in ten markets.
QVC revenues increased 19.3% to $632.5 million in the second quarter of 1999, as compared to the $530.0 million reported in the same period in 1998. Operating cash flow for the quarter was $121.5 million, an increase of 31.1% from the $92.7 million reported in the second quarter of 1998. QVC's revenues for the six months ended June 30, 1999 were $1.282 billion, representing a 19.3% increase from the $1.075 billion reported for the same period in 1998. Operating cash flow for the six months ended June 30, 1999 was $252.4 million, an increase of 34.3% over the $187.9 million reported for the same period in 1998. QVC's results reflect double-digit revenue and operating cash flow growth in each of its businesses in the United States, United Kingdom and Germany.
On a consolidated basis, the Company reported net income for common stockholders of $816.4 million or $1.10 per share for the quarter ended June 30, 1999. The Company reported a net loss for common stockholders of $92.0 million or $0.13 per share for the prior year period, which includes a loss from discontinued operations of $4.8 million or $0.01 per share. Income from continuing operations for common stockholders before extraordinary items for the three months ended June 30, 1999 was $818.7 million or $1.10 per share, as compared to a loss of $87.2 million or $0.12 per share for the three months ended June 30, 1998.
For the six months ended June 30, 1999, the Company reported net income for common stockholders of $889.9 million or $1.20 per share, which includes a loss from discontinued operations of $20.1 million or $0.03 per share. The Company reported a net loss for common stockholders of $178.0 million or $0.24 per share for the comparable 1998 period, which includes a loss from discontinued operations of $14.9 million or $0.02 per share. Income from continuing operations for common stockholders before extraordinary items for the six months ended June 30, 1999 was $913.0 million or $1.23 per share, as compared to a loss from continuing operations of $163.1 million or $0.22 per share for the six months ended June 30, 1998.
Net income for common stockholders for the 1999 periods is primarily attributable to the effects of the $1.5 billion breakup fee received by the Company in May 1999 as a result of the termination of the MediaOne Merger Agreement. Net loss for common stockholders for the 1998 periods is primarily attributable to equity in net losses of affiliates, principally associated with the Company's investment in Sprint PCS. As a result of the restructuring of Sprint PCS in the fourth quarter of 1998, the Company no longer accounts for its investment in Sprint PCS under the equity method. Excluding the effects of the one-time breakup fee (net of transaction costs), the Company's net loss for common stockholders would have been $0.17 and $0.08 for the three and six months ended June 30, 1999, respectively.
This press release may contain forward-looking statements. Readers are cautioned that such forward-looking statements involve risks and uncertainties that could significantly affect actual results from those expressed in any such forward-looking statements. Readers are directed to the note contained on page one of Comcast's Quarterly Report on Form 10-Q for a description of such risks and uncertainties.
Comcast Corporation (www.comcast.com) is principally involved in the development, management and operation of broadband cable networks and the provision of programming content, through principal ownership of QVC, Comcast-Spectacor and Comcast SportsNet, a controlling interest in E! Entertainment Television and through other programming investments.
Comcast's Class A Special Common Stock and Class A Common Stock are traded on the Nasdaq Stock Market under the symbols CMCSK and CMCSA, respectively.