3af5ec7bd1a91f066022d0d8d5e2725c.ppt
- Количество слайдов: 29
th Annual 15 Smith Barney Citigroup Entertainment, Media & Telecommunications Conference January 11, 2005
Safe Harbor Statement Any statements in this presentation that are not historical facts are forwardlooking statements. The words “plan”, “believe”, “expect”, “anticipate”, “estimate” and other expressions that indicate future events and trends identify forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. Factors that could have a material and adverse impact on actual results are described in the reports and documents Mediacom files from time to time with the Securities and Exchange Commission. Mediacom undertakes no obligation to publicly release the results of any revisions to these forward-looking statements to reflect events or circumstances after today or to reflect the occurrence of unanticipated events. 2
Use of Non-GAAP Financial Measures This presentation includes the financial measures “operating income before depreciation and amortization, ” “unlevered free cash flow” and “free cash flow”, which are not determined in accordance with generally accepted accounting principles (GAAP) in the United States. The Company defines unlevered free cash flow as operating income before depreciation and amortization less capital expenditures, and free cash flow as operating income before depreciation and amortization less interest expense, net and capital expenditures. Any applicable reconciliation of historical non-GAAP financial measures included in this presentation to the most directly comparable GAAP financial measures is available at the Press Releases link in the Investor Relations section of the Company’s website at www. mediacomcc. com. The Company is unable to reconcile operating income before depreciation and amortization, unlevered free cash flow and free cash flow to their most directly comparable GAAP measures on a forward-looking basis primarily because it is impractical to project the timing of certain items, such as the initiation of depreciation relative to network construction projects, or changes in working capital. 3
Mediacom Highlights § Growing ARPU and expanding RGU penetration despite intensified video competition § Attractive growth prospects from Video/Data/ Voice triple play § Normalized CAPEX leads to increasing levels of Free Cash Flow § Flexible capital structure with substantial liquidity position 4
Our Position Today § Fiber-rich broadband network Ø Ø § Regional clusters facilitate new product launches Future capex mostly success-based Facing intensified video competition Ø § Aggressively introducing advanced video products Ø § DBS local-into-local now covers 91% of our markets Widespread rollout of VOD, SVOD, HDTV and DVR by YE 2005 Redefining and expanding our market opportunity Ø Continuing growth in RGUs with revenue diversification Ø Significant opportunities in residential and commercial data Ø Launching Vo. IP telephone service in 1 H 2005 5
The Power of the ONE Network… Northern Network: 1, 500, 000 Homes MN Minneapolis WI IA Cedar Rapids South Bend Moline Des Moines Peoria IL IN Springfield Charleston SONET-Ready in 2005 Carbondale 6
…is Beginning to Demonstrate its Potential Southern Network: 400, 000 Homes GA AL Albany MS Valdosta Mobile Pensacola Tallahassee FL Northern/Southern Network Reach: 70% of Our Total Homes 7
Growing ARPU Despite Intensified Video Competition Video ARPU Total ARPU $40. 23 $44. 54 $43. 17 $50. 10 $45. 90 $55. 75 $47. 20 $58. 95 8
Video Service Platform is Complete Availability (% of digital customers) VOD DVR HDTV YE 03 50% - 70% YE 04 65% 98% 77% YE 05 (projected) 80% 100% 90% Product Differentiation 9
Next Year: Vo. IP Telephony § Vo. IP: next layer of revenue growth Completes the “triple play” bundle Ø Wireless opportunity = “quadruple play” Ø § § Strategic alliance with Sprint Compelling offering to the consumer Primary line service with unlimited local and long distance Ø Targeting $40 per month Ø Seamless and convenient switch Ø § § Moderate levels of success-based capex Favorable return on invested capital Mediacom expects to launch Vo. IP service in 1 H 2005 10
Growth Propelled by New RGU’s Rev/Basic Sub: $35 $59 $81 98% 81% 69% 18% 14% 5% RGU/HP 68% Rev/RGU $34 79% $40 8% 5% 100% $43 11
Key Operational Objectives § Redesign/enhance core video strategies § Expand breadth and depth of advanced video services § Strengthen broadband data product line § Prepare for Vo. IP launch in 1 H 2005 12
Current Core Video Strategy § Customer Acquisition Re-price and re-package digital offerings Ø Increasing focus on bundling digital service with VOD/SVOD, HDTV and DVRs Ø § Retention Selected offers and promotions to retain customers Ø Greater emphasis on customer care efforts Ø § Communication Brand product differentiation Ø Disrupt/combat negative competitive marketing efforts Ø 13
New Digital Packages Close the Gap Average Cost - 4 Set Household Mediacom: 2 Digital TVs, 2 Analog TVs Satellite: All Digital TVs/No Analog Offered Service 1 -Pay Starz + SVOD 2 -Pay Show/HBO + SVOD Mediacom $61 $69 - $73 $81 $94 DBS $67 $78 $85 - $88 $92 - $96 3 Pay + SVOD 4 Pay + SVOD 14
Mediacom On-Demand Case Study: North Central Region § Orders per Month § Usage Rates § § 1, 200 hours of content On-Demand Premium Services: Starz, Showtime and HBO included with premium subscription Value-based packaging Objectives: - Drive digital sales Enhance value proposition Lower digital churn Generate higher incremental transactional revenues 15
Regaining the Competitive Advantage DVR § No equipment to purchase § No contract § HDTV capable § Low entry price ($2. 50/month incremental) § Fully integrated with TV Guide § Dual-tuner rollout: December 2004 – January 2005 Mediacom HD Pack includes: HDTV § Mediacom equipment is $2. 50/month vs. Satellite’s $200 plus in upfront equipment charges § HBO HD, Starz HD, Showtime HD included w/premium subscription § Local Broadcast Channels 16
Data Strategy § § Launching 5 MB residential product for heavy users “Lite” (128 k) product introduced in Q 2 2004 Retention tool Ø Aimed at dial-up market Ø § § Commercial business opportunities Benefits of renegotiated AT&T data contract Lower per customer costs to Mediacom (including “Lite” product) Ø Allows for migration to in-house provisioning Ø 17
Data Penetration Will Accelerate § Our lower data penetration is largely due to data market launches between two and four years after our peers Data Customer Penetration as of Q 3 2004 § Our markets, although smaller relative to peers, are demographically inline with U. S. averages and offer strong opportunities for increasing data penetration 2003 Household Income 1 Internet Penetration U. S. average $42, 400 58%2 MCCC market average $43, 800 52%3 1 Source: Nielsen Media Research (based on information from U. S. census). Source: IDC (2003). 3 Mediacom estimate based on publicly available information and cable system customer surveys. 2 18
Mediacom’s Vo. IP Service Features § Primary line service Unlimited local and long distance Ø Targeting $40 per month Ø § Consumers switching to Mediacom’s phone service can: Keep their existing phone numbers and directory listings Ø Utilize their existing telephones and home wiring Ø Access all of the traditional telephone products and services (caller ID, call waiting, call forwarding, etc. ) Ø Take comfort in the stability, security and reliability of facilities-based providers Ø 19
Sprint Partnership § § Strategic alliance utilizes Mediacom’s advanced digital network and Sprint’s national infrastructure and telecommunications expertise Multi-year agreement with favorable economics Ø Ø § Unlimited usage, any distance, flat rate Sliding scale pricing to Mediacom Sprint will assist Mediacom in: Ø Ø Ø Switching and termination of traffic to the public switched telephone network (PSTN) Delivery of enhanced E 911 emergency service, local number portability, operator and directory assistance Voicemail and other features Product development Opportunity to resell Sprint’s wireless services 20
Single Platform of Broadband Products DBS Digital - RBOC - ILEC - Mediacom Digital HDTV DVR - - HDTV Local HDTV DVR - DSL Voice Modem Vo. IP VOD SVOD RBOC Overlap in Only 65% of Mediacom’s Footprint 21
Dramatic Improvement in FCF Substantial NOLs Shelter FCF from Cash Taxes $ in millions G = Guidance 22
YTD 2004 Peer Comparison Source: Public filings and reports. 1 Excludes Hurricane Ivan related charges. 23
Flexible Capital Structure Mediacom Communications Corporation Total Debt: $3. 0 Billion Convertible Notes Total Debt/OCF Total Debt (excl cnvt)/OCF $825 7. 0 x Mediacom LLC Subsidiaries Senior Debt $656 2 $486 Unused Credit Commitments Senior Debt/SCF 3. 1 x Notes: Cost of Debt: 6. 7% Mediacom Broadband LLC Mediacom LLC Senior Notes Total Debt/OCF 1 $173 7. 4 x 6. 9 x Senior Notes Total Debt/OCF $400 6. 3 x Mediacom Broadband LLC Subsidiaries Senior Debt 3 $965 Unused Credit Commitments $431 Senior Debt/SCF 4. 3 x Based on Q 3 ‘ 04 data; OCF is annualized and excludes hurricane-related charges. Dollars in millions. 1 OCF for Mediacom LLC includes cash investment income. 2 Proforma for the new credit facility as of 10/21/04. 3 Includes letters of credit and capital lease obligations (net of carve-outs) for bank covenant purposes. 24
New $1. 15 Billion Credit Facility § Extended debt maturities § Enhanced liquidity § Greater covenant headroom § Simplified corporate structure and reporting 25
MCCC Scheduled Debt Maturities Q 3 2004 $1, 406 Fixed - Floating: 73% - 27% $550 $270. 5 $220. 5 $40. 5 $70. 5 $206 $238. 5 $5. 5 $ in millions Note: Assumes no repayment of revolver outstanding until required by commitment reduction schedule. 26
Credit Availability § Solid track record of preserving liquidity and maintaining ample borrowing availability $ in millions 27
Summary § Strengthening competitive video position § Broadening data business with commercial accounts § Seizing Vo. IP opportunity § Accelerating positive free cash flow 28
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3af5ec7bd1a91f066022d0d8d5e2725c.ppt