GCI Liberty Reports Second Quarter 2020 Financial Results

ENGLEWOOD, Colo.--(BUSINESS WIRE)-- GCI Liberty, Inc. (“GCI Liberty”) (Nasdaq: GLIBA, GLIBP) today reported second quarter 2020 results. Headlines include(1):

  • Announced proposed combination with Liberty Broadband Corporation on August 6th
    • Stock-for-stock merger expected to close in first half of 2021, subject to potential COVID-19 related delays
  • GCI(2) revenue increased 5% compared to the second quarter of 2019
    • GCI Consumer revenue up 5%
    • GCI Business revenue up 6%
  • GCI operating income increased $22 million and Adjusted OIBDA(3) up 18%
  • Liquidity as of June 30th
    • $552 million of cash and cash equivalents, including $88 million at GCI
    • $271 million undrawn capacity under the GCI senior credit facility

"GCI continued to make substantial financial and operational progress during the quarter,” said GCI CEO, Ron Duncan. “Despite the challenges of serving our customers in the midst of a pandemic, we added 3,700 consumer cable modem customers during the quarter. Our consumers responded to 5G service, faster speeds and improved coverage from our wireless network upgrades and we added 3,500 new consumer wireless subscribers sequentially. These gains played an important role in our strong Adjusted OIBDA growth for the quarter.”

Corporate Update

On August 6, 2020, GCI Liberty and Liberty Broadband announced that they have entered into a definitive merger agreement under which Liberty Broadband has agreed to acquire GCI Liberty in a stock-for-stock merger (the “Combination”). Additional information regarding the Combination can be found in the press release and presentation issued by GCI Liberty on August 6, 2020 which are available at ir.gciliberty.com/index.php/news-releases and www.gciliberty.com/events, respectively.

Note on COVID-19

GCI Liberty continues to monitor and assess the effects of the COVID-19 pandemic on its operations, wholly-owned businesses and various investments. COVID-19 has not had a material impact on GCI Liberty’s operating results in the second quarter.

GCI has seen a substantial increase in network traffic since early March, with utilization stabilizing at approximately 25% greater than pre-COVID-19 levels. The network continues to perform well despite higher levels of traffic. To assist Alaskans impacted by the COVID-19 pandemic, GCI launched several offers in March, providing free entry-level cable modem internet plans for new customers and free upgrades for existing customers through June 30, 2020. GCI worked directly with the Department of Education and Early Development and the Alaska Council of School Administrators to offer entry-level data plans with Wi-Fi equipment to K-12 students and teachers for free until June 30, 2020. GCI also participated in the Federal Communications Commission's ("FCC") Keep Americans Connected Pledge, pausing disconnects and waiving late fees for residential and small business customers impacted by COVID-19 and opening its Wi-Fi hotspots to any American in need of them. Additionally, the State of Alaska has restricted GCI from charging late fees to or disconnecting residential customers impacted by COVID-19 until November 15, 2020 or the end of the public health emergency. The following discussion includes the impact of GCI's COVID-19 related offers and programs on financial results and subscriber metrics.

GCI Liberty is in compliance with all debt covenants as of June 30, 2020. GCI's leverage, as defined in its credit agreement, was 4.2x, versus a maximum allowable leverage of 6.5x.

Discussion of Results

Unless otherwise noted, the following discussion compares financial information for the three months ended June 30, 2020 to financial information for the same period in 2019.

GCI

The following table provides GCI’s operating metrics and financial results for the second quarter of 2019 and 2020.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2Q19

 

 

2Q20

 

 

% Change

 

(amounts in thousands, except operating metrics)

 

 

 

 

 

 

 

 

 

 

GCI Consolidated Financial Metrics

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

Consumer

 

$

106,968

 

$

112,047

 

 

5

%

Business

 

 

104,011

 

 

110,534

 

 

6

%

Total revenue

 

$

210,979

 

$

222,581

 

 

5

%

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

(7,201)

 

$

14,806

 

 

306

%

Operating income margin (%)

 

 

(3.4)%

 

 

6.7%

 

 

1,010

bps

 

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA(a)

 

$

66,121

 

$

78,045

 

 

18

%

Adjusted OIBDA margin(a) (%)

 

 

31.3%

 

 

35.1%

 

 

380

bps

 

 

 

 

 

 

 

 

 

 

 

GCI Consumer

 

 

 

 

 

 

 

 

 

 

Financial Metrics

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

39,915

 

$

42,327

 

 

6

%

Data

 

 

41,457

 

 

45,416

 

 

10

%

Video

 

 

21,049

 

 

20,461

 

 

(3)

%

Voice

 

 

4,547

 

 

3,843

 

 

(15)

%

Total revenue

 

$

106,968

 

$

112,047

 

 

5

%

Operating Metrics

 

 

 

 

 

 

 

 

 

 

Wireless:

 

 

 

 

 

 

 

 

 

 

Revenue generating lines in service(b)

 

 

181,400

 

 

179,400

 

 

(1)

%

Non-revenue generating lines in service(c)

 

 

9,800

 

 

3,600

 

 

(63)

%

Wireless lines in service

 

 

191,200

 

 

183,000

 

 

(4)

%

Data:

 

 

 

 

 

 

 

 

 

 

Revenue generating cable modem subscribers(d)

 

 

124,100

 

 

134,900

 

 

9

%

Non-revenue generating cable modem subscribers(e)

 

 

-

 

 

800

 

 

NM

 

Cable modem subscribers

 

 

124,100

 

 

135,700

 

 

9

%

Video:

 

 

 

 

 

 

 

 

 

 

Basic subscribers

 

 

84,100

 

 

77,700

 

 

(8)

%

Homes passed

 

 

253,400

 

 

253,400

 

 

-

%

Voice - Total access lines in service(f)

 

 

42,200

 

 

38,200

 

 

(9)

%

 

 

 

 

 

 

 

 

 

 

 

GCI Business

 

 

 

 

 

 

 

 

 

 

Financial Metrics

 

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

Wireless

 

$

23,726

 

$

21,035

 

 

(11)

%

Data

 

 

64,628

 

 

73,756

 

 

14

%

Video

 

 

3,988

 

 

4,427

 

 

11

%

Voice

 

 

11,669

 

 

11,316

 

 

(3)

%

Total revenue

 

$

104,011

 

$

110,534

 

 

6

%

Operating Metrics

 

 

 

 

 

 

 

 

 

 

Wireless - Revenue generating lines in service(b)

 

 

21,400

 

 

25,000

 

 

17

%

Data - Revenue generating cable modem subscribers(d)

 

 

9,000

 

 

8,700

 

 

(3)

%

Voice - Total access lines in service(f)

 

 

35,600

 

 

33,500

 

 

(6)

%

__________________________

(a)

See reconciling schedule 1.

(b)

A revenue generating wireless line in service is defined as a wireless device with a monthly fee for services.

(c)

A non-revenue generating wireless line in service is defined as a data-only line with no monthly fee for services.

(d)

A revenue generating cable modem subscriber is defined by the purchase of cable modem service regardless of the level of service purchased. If one entity purchases multiple cable modem service access points, each access point is counted as a subscriber.

(e)

A non-revenue generating cable modem subscriber is defined by the provision of basic cable modem service as a promotion to aid those impacted by COVID-19.

(f)

A local access line in service is defined as a revenue generating circuit or channel connecting a customer to the public switched telephone network.

GCI revenue increased due to growth in consumer and business revenue. Operating income (loss) and Adjusted OIBDA improved meaningfully due to revenue growth and lower selling, general and administrative expense. Expense declined due to cost containment initiatives and lower health care costs as employees limited elective medical procedures due to COVID-19.

GCI Consumer

Consumer revenue grew in the second quarter with wireless and data revenue gains more than offsetting losses in video and voice. Wireless revenue growth was driven by higher plan revenue. Data revenue growth was due to higher subscriber counts. Wireless and data revenue generating subscriber counts also increased on a sequential basis. Video revenue declined due to a lower number of subscribers, partially offset by higher prices. Voice revenue decreased due to subscriber declines.

GCI Business

GCI Business revenue increased in the second quarter due to higher data and video revenue. Data revenue increased primarily from increases in the government, health and education businesses. Video revenue increased slightly due to higher political advertising revenue. Voice revenue declined slightly due to fewer subscribers. Wireless revenue declined due to lower backhaul revenue and grant revenue, partially offset by higher roaming.

Capital Expenditures

Year to date, GCI has spent $62 million on capital expenditures, excluding capitalized interest and accrued capital expenditures from 2019. Capital expenditure spending was related primarily to improvements to the wireless and hybrid fiber coax networks.

Share Repurchases

GCI Liberty did not repurchase shares from May 1, 2020 through July 31, 2020. The total remaining repurchase authorization for GCI Liberty is approximately $494 million.

FOOTNOTES

(1)

GCI Liberty’s President and CEO, Greg Maffei, will discuss these headlines and other matters on GCI Liberty's earnings conference call which will begin at 11:15 a.m. (E.D.T.) on August 10, 2020. For information regarding how to access the call, please see “Important Notice” later in this document.

(2)

GCI Liberty’s principal asset is GCI Holdings, LLC (“GCI” or “GCI Holdings”), Alaska's largest communications provider. Other assets include its interests in Charter Communications, Inc. ("Charter") and Liberty Broadband Corporation, as well as its interest in LendingTree and subsidiary Evite.

(3)

For a definition of Adjusted OIBDA and Adjusted OIBDA margin and applicable reconciliations, see the accompanying schedules.

GCI LIBERTY FINANCIAL METRICS

 

 

 

 

 

 

 

 

(amounts in millions)

 

2Q19

 

2Q20

 

Revenue

 

 

 

 

 

 

 

GCI Holdings

 

$

210,979

 

$

222,581

 

Corporate and other

 

 

6,587

 

 

2,239

 

Total GCI Liberty Revenue

 

$

217,566

 

$

224,820

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

 

 

 

 

 

 

 

GCI Holdings

 

$

(7,201)

 

$

14,806

 

Corporate and other

 

 

(9,052)

 

 

(12,146)

 

Total GCI Liberty Operating Income (Loss)

 

$

(16,253)

 

$

2,660

 

 

 

 

 

 

 

 

 

Adjusted OIBDA

 

 

 

 

 

 

 

GCI Holdings

 

$

66,121

 

$

78,045

 

Corporate and other

 

 

(5,511)

 

 

(9,832)

 

Total GCI Liberty Adjusted OIBDA

 

$

60,610

 

$

68,213

 

NOTES

The following financial information with respect to GCI Liberty's investments in equity securities and equity affiliates is intended to supplement GCI Liberty's consolidated statements of operations which are included in its Forms 10-Q for the three months ended March 31, 2020 and June 30, 2020.

Fair Value of Public Holdings

 

 

 

 

 

 

 

 

(amounts in millions)

 

3/31/2020

 

6/30/2020

 

Charter(1)

 

$

2,338

 

$

2,733

 

Liberty Broadband(1)

 

 

4,726

 

 

5,291

 

LendingTree(2)

 

 

632

 

 

997

 

Total

 

$

7,696

 

$

9,021

 

__________________________

(1)

Represents fair value of the investments in Charter and Liberty Broadband. A portion of the Charter equity securities are considered covered shares and subject to certain contractual restrictions in accordance with the indemnification obligation, as described below.

(2)

Represents fair value of the investment in LendingTree. In accordance with GAAP, this investment is accounted for using the equity method of accounting and is included in the balance sheet of GCI Liberty at $165 million and $166 million at March 31, 2020 and June 30, 2020, respectively.

Cash and Debt

The following presentation is provided to separately identify cash and liquid investments and debt information.

 

 

 

 

 

 

 

 

(amounts in millions)

 

3/31/2020

 

6/30/2020

 

Cash and Cash Equivalents:

 

 

 

 

 

 

 

GCI

 

$

82

 

$

88

 

Corporate and other

 

 

487

 

 

464

 

Total GCI Liberty Consolidated Cash

 

$

569

 

$

552

 

 

 

 

 

 

 

 

 

Debt:

 

 

 

 

 

 

 

Senior Notes

 

$

775

 

$

775

 

Senior Credit Facility

 

 

512

 

 

511

 

Finance Leases and Other(1)

 

 

109

 

 

107

 

Total GCI Debt

 

$

1,396

 

$

1,393

 

 

 

 

 

 

 

 

 

Margin Loan

 

$

1,300

 

$

1,300

 

1.75% Exchangeable Senior Debentures due 2046

 

 

477

 

 

477

 

Total Corporate Level Debt

 

$

1,777

 

$

1,777

 

 

 

 

 

 

 

 

 

Total GCI Liberty Debt

 

$

3,173

 

$

3,170

 

Fair market value adjustment and deferred loan costs

 

 

143

 

 

196

 

Finance leases and tower obligation (excluded from GAAP Debt)

 

 

(102)

 

 

(100)

 

Total GCI Liberty Debt (GAAP)

 

$

3,214

 

$

3,266

 

 

 

 

 

 

 

 

 

Other Financial Obligations:

 

 

 

 

 

 

 

Indemnification Obligation(2)

 

$

180

 

$

215

 

Preferred Stock(3)

 

 

178

 

 

178

 

 

 

 

 

 

 

 

 

GCI Leverage(4)

 

 

4.4x

 

 

4.2x

 

__________________________

(1)

Includes the Wells Fargo Note Payable and current and long-term obligations under finance leases and communication tower obligations.

(2)

Indemnity to Qurate Retail, pursuant to an indemnification agreement (the "indemnification agreement"), with respect to the Liberty Interactive LLC ("LI LLC") 1.75% exchangeable debentures due 2046 (the "Charter exchangeable debentures"), as described below.

(3)

Preferred shares have a 7% coupon, $25/share liquidation preference plus accrued and unpaid dividends and 1/3 vote per share. The redemption date is the first business day following the twenty-first anniversary of the March 8, 2018 auto conversion. The preferred stock is considered a liability for GAAP purposes.

(4)

As defined in GCI's credit agreement.

GCI Liberty cash declined in the quarter as an increase in cash at GCI was more than offset by corporate expense. GCI cash increased as cash from operations more than offset capital expenditures. Both GCI Liberty and GCI debt were flat for the quarter.

Pursuant to an indemnification agreement, GCI Liberty will compensate Qurate Retail for any payments made in excess of the adjusted principal amount of the LI LLC Charter exchangeable debentures to any holder that exercises its exchange right on or before the put/call date of October 5, 2023. This indemnity is supported by a negative pledge in favor of Qurate Retail on the reference shares of Class A common stock of Charter held at GCI Liberty that underlie the LI LLC Charter exchangeable debentures. The indemnification obligation on GCI Liberty's balance sheet is valued based on the estimated exchange feature in the LI LLC Charter exchangeable debentures. As of June 30, 2020, a holder of the LI LLC Charter exchangeable debentures does have the ability to exchange, and accordingly, the indemnification obligation has been classified as a current liability.

Important Notice: GCI Liberty (Nasdaq: GLIBA, GLIBP) President and CEO, Greg Maffei, will discuss GCI Liberty's earnings release on a conference call which will begin at 11:15 a.m. (E.D.T.) on August 10, 2020. The call can be accessed by dialing (800) 458-4121 or (323) 794-2093, passcode 3591435, at least 10 minutes prior to the start time. The call will also be broadcast live across the Internet and archived on our website. To access the webcast go to www.gciliberty.com/events. Links to this press release and replays of the call will also be available on GCI Liberty's website.

This press release includes certain forward-looking statements under the Private Securities Litigation Reform Act of 1995, including statements about business strategies, market potential, future financial prospects, capital expenditures, the Combination, the impact of COVID-19, Alaska's economy, the launch of new products and services, indemnification by GCI Liberty, the continuation of our stock repurchase program and other matters that are not historical facts. These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, possible changes in market acceptance of new products or services, competitive issues, regulatory matters affecting our businesses, the satisfaction of conditions to the Combination, continued access to capital on terms acceptable to GCI Liberty, changes in law and government regulations, the availability of investment opportunities, general market conditions (including as a result of COVID-19) and market conditions conducive to stock repurchases. These forward-looking statements speak only as of the date of this press release, and GCI Liberty expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in GCI Liberty's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Please refer to the publicly filed documents of GCI Liberty, including the most recent Forms 10-K and Forms 10-Q, for additional information about GCI Liberty and about the risks and uncertainties related to GCI Liberty's business which may affect the statements made in this press release.

Additional Information

Nothing in this communication shall constitute a solicitation to buy or an offer to sell securities of Liberty Broadband or GCI Liberty. The offer and sale of shares in the Combination will only be made pursuant to Liberty Broadband’s effective registration statement. Liberty Broadband’s stockholders, GCI Liberty’s stockholders and other investors are urged to read the registration statement and the joint proxy statement/prospectus to be filed regarding the Combination and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information about the Combination. Copies of these SEC filings are available free of charge at the SEC’s website (http://www.sec.gov). Copies of the filings together with the materials incorporated by reference therein are also available, without charge, by directing a request to Liberty Broadband Corporation, 12300 Liberty Boulevard, Englewood, Colorado 80112, Attention: Investor Relations, Telephone: (720) 875-5700 or to GCI Liberty, Inc., 12300 Liberty Boulevard, Englewood, Colorado 80112, Attention: Investor Relations, Telephone: (720) 875-5900.

Participants in the Solicitation

Liberty Broadband and GCI Liberty and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies in respect of the Combination. Information about Liberty Broadband’s directors and executive officers is available in Liberty Broadband’s definitive proxy statement for its 2020 annual meeting of stockholders, which was filed with the SEC on April 10, 2020. Information about GCI Liberty’s directors and executive officers is available in GCI Liberty’s definitive proxy statement for its 2020 annual meeting of stockholders, which was filed with the SEC on April 10, 2020. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the Combination when they become available. Investors should read the joint proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from Liberty Broadband and GCI Liberty as indicated above.

NON-GAAP FINANCIAL MEASURES

To provide investors with additional information regarding our financial results, this press release includes a presentation of Adjusted OIBDA, which is a non-GAAP financial measure, for GCI Liberty (and certain of its subsidiaries) and GCI Holdings together with a reconciliation to that entity or such businesses’ operating income, as determined under GAAP. GCI Liberty defines Adjusted OIBDA as operating income (loss) plus depreciation and amortization, stock-based compensation, separately reported litigation settlements, insurance proceeds, restructuring, acquisition and other related costs and impairment charges. Further, this press release includes Adjusted OIBDA margin which is also a non-GAAP financial measure. GCI Liberty defines Adjusted OIBDA margin as Adjusted OIBDA divided by revenue.

GCI Liberty believes Adjusted OIBDA is an important indicator of the operational strength and performance of its businesses by identifying those items that are not directly a reflection of each business' performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. Because Adjusted OIBDA is used as a measure of operating performance, GCI Liberty views operating income as the most directly comparable GAAP measure. Adjusted OIBDA is not meant to replace or supersede operating income or any other GAAP measure, but rather to supplement such GAAP measures in order to present investors with the same information that GCI Liberty's management considers in assessing the results of operations and performance of its assets. Please see the attached schedules for applicable reconciliations.

SCHEDULE 1

The following table provides a reconciliation of GCI’s operating income (loss) to its Adjusted OIBDA for the three months ended June 30, 2019 and June 30, 2020, respectively.

GCI HOLDINGS ADJUSTED OIBDA RECONCILIATION

(amounts in thousands)

 

2Q19

 

2Q20

 

GCI Holdings

 

 

 

 

 

 

 

Operating Income (Loss)

 

$

(7,201)

 

$

14,806

 

Depreciation and amortization

 

 

65,177

 

 

60,543

 

Stock-based compensation

 

 

3,927

 

 

2,696

 

Insurance proceeds and restructuring, net

 

 

4,218

 

 

 

Adjusted OIBDA

 

$

66,121

 

$

78,045

 

SCHEDULE 2

The following table provides a reconciliation of operating income (loss) calculated in accordance with GAAP to Adjusted OIBDA for GCI Liberty for the three months ended June 30, 2019 and June 30, 2020, respectively.

GCI LIBERTY ADJUSTED OIBDA RECONCILIATION

(amounts in thousands)

 

2Q19

 

2Q20

GCI Liberty

 

 

 

 

 

 

GCI Liberty Operating Income (Loss)

 

$

(16,253)

 

$

2,660

Stock-based compensation

 

 

6,754

 

 

4,393

Insurance proceeds and restructuring, net

 

 

4,218

 

 

Depreciation and amortization

 

 

65,891

 

 

61,160

Consolidated GCI Liberty Adjusted OIBDA

 

$

60,610

 

$

68,213

GCI Holdings

 

$

66,121

 

 

78,045

Corporate and other

 

 

(5,511)

 

 

(9,832)

GCI LIBERTY, INC. AND SUBSIDIARIES

BALANCE SHEET INFORMATION

(unaudited)

 

 

June 30,

 

December 31,

 

 

 

2020

 

2019

 

 

 

amounts in thousands,

 

 

 

except share amounts

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

551,595

 

569,520

 

Trade and other receivables, net of allowance for doubtful accounts of $7,102 and $7,516, respectively

 

 

94,820

 

114,435

 

Other current assets

 

 

35,295

 

43,868

 

Total current assets

 

 

681,710

 

727,823

 

Investments in equity securities

 

 

2,738,284

 

2,605,293

 

Investments in affiliates, accounted for using the equity method

 

 

167,121

 

167,643

 

Investment in Liberty Broadband measured at fair value

 

 

5,290,841

 

5,367,242

 

Property and equipment, net

 

 

1,056,516

 

1,090,901

 

Intangible assets not subject to amortization

 

 

 

 

 

 

Goodwill

 

 

855,837

 

855,837

 

Cable certificates

 

 

305,000

 

305,000

 

Other

 

 

41,500

 

41,500

 

 

 

 

1,202,337

 

1,202,337

 

Intangible assets subject to amortization, net

 

 

369,581

 

391,979

 

Tax sharing receivable

 

 

87,258

 

84,534

 

Other assets, net

 

 

339,482

 

295,693

 

Total assets

 

$

11,933,130

 

11,933,445

 

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

108,410

 

92,893

 

Deferred revenue

 

 

25,714

 

27,886

 

Current portion of debt, including $660,963 and $0 measured at fair value, respectively

 

 

664,087

 

3,008

 

Indemnification obligation

 

 

214,671

 

202,086

 

Other current liabilities

 

 

71,114

 

69,149

 

Total current liabilities

 

 

1,083,996

 

395,022

 

Long-term debt, net, including $0 and $658,839 measured at fair value, respectively

 

 

2,602,296

 

3,263,210

 

Obligations under finance leases and tower obligations, excluding current portion

 

 

94,984

 

97,507

 

Long-term deferred revenue

 

 

51,945

 

57,986

 

Deferred income tax liabilities

 

 

1,531,407

 

1,527,109

 

Preferred stock

 

 

178,066

 

178,002

 

Derivative instrument

 

 

61,437

 

71,305

 

Other liabilities

 

 

118,744

 

133,020

 

Total liabilities

 

 

5,722,875

 

5,723,161

 

Equity

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Series A common stock, $0.01 par value. Authorized 500,000,000 shares; issued and outstanding 101,328,441 shares at June 30, 2020 and 101,306,716 shares at December 31, 2019

 

 

1,013

 

1,013

 

Series B common stock, $0.01 par value. Authorized 20,000,000 shares; issued and outstanding 4,488,674 shares at June 30, 2020 and 4,437,593 shares at December 31,2019

 

 

45

 

44

 

Series C common stock, $0.01 par value. Authorized 1,040,000,000 shares; no issued and outstanding at June 30, 2020 and December 31, 2019

 

 

 

 

Additional paid-in capital

 

 

3,227,258

 

3,221,885

 

Accumulated other comprehensive earnings (loss), net of taxes

 

 

14,767

 

(4,084)

 

Retained earnings

 

 

2,958,423

 

2,982,626

 

Total stockholders' equity

 

 

6,201,506

 

6,201,484

 

Non-controlling interests

 

 

8,749

 

8,800

 

Total equity

 

 

6,210,255

 

6,210,284

 

Commitments and contingencies

 

 

 

 

 

 

Total liabilities and equity

 

$

11,933,130

 

11,933,445

 

GCI LIBERTY, INC. AND SUBSIDIARIES

STATEMENT OF OPERATIONS INFORMATION

(unaudited)

 

 

Three months ended

 

 

 

 

June 30,

 

 

 

 

2020

 

2019

 

 

 

 

amounts in thousands, except per share amounts

 

 

Revenue

 

$

224,820

 

217,566

 

 

Operating costs and expenses:

 

 

 

 

 

 

 

Operating expense (exclusive of depreciation and amortization shown separately below)

 

 

70,838

 

68,432

 

 

Selling, general and administrative, including stock-based compensation

 

 

90,162

 

95,278

 

 

Depreciation and amortization expense

 

 

61,160

 

65,891

 

 

Insurance proceeds and restructuring, net

 

 

 

4,218

 

 

 

 

 

222,160

 

233,819

 

 

Operating income (loss)

 

 

2,660

 

(16,253)

 

 

Other income (expense):

 

 

 

 

 

 

 

Interest expense (including amortization of deferred loan fees)

 

 

(34,387)

 

(40,386)

 

 

Share of earnings (losses) of affiliates, net

 

 

2,238

 

(1,068)

 

 

Realized and unrealized gains (losses) on financial instruments, net

 

 

860,867

 

679,098

 

 

Tax sharing agreement

 

 

14,444

 

7,452

 

 

Other, net

 

 

(242)

 

11,596

 

 

 

 

 

842,920

 

656,692

 

 

Earnings (loss) before income taxes

 

 

845,580

 

640,439

 

 

Income tax (expense) benefit

 

 

(234,952)

 

(181,395)

 

 

Net earnings (loss)

 

 

610,628

 

459,044

 

 

Less net earnings (loss) attributable to the non-controlling interests

 

 

(26)

 

 

 

Net earnings (loss) attributable to GCI Liberty, Inc. shareholders

 

$

610,654

 

459,044

 

 

Basic net earnings (loss) attributable to Series A and Series B GCI Liberty, Inc. shareholders per common share

 

$

5.79

 

4.38

 

 

Diluted net earnings (loss) attributable to Series A and Series B GCI Liberty, Inc. shareholders per common share

 

$

5.76

 

4.34

 

 

GCI LIBERTY, INC. AND SUBSIDIARIES

STATEMENT OF CASH FLOWS INFORMATION

(unaudited)

 

 

Six months ended

 

 

 

June 30,

 

 

 

2020

 

2019

 

 

 

amounts in thousands

 

Cash flows from operating activities:

 

 

 

 

 

 

Net earnings (loss)

 

$

(21,274)

 

1,137,530

 

Adjustments to reconcile net earnings (loss) to net cash from operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

124,168

 

133,569

 

Stock-based compensation expense

 

 

6,868

 

12,385

 

Share of (earnings) losses of affiliates, net

 

 

(1,531)

 

4,364

 

Realized and unrealized (gains) losses on financial instruments, net

 

 

(26,875)

 

(1,688,698)

 

Deferred income tax expense (benefit)

 

 

(1,572)

 

450,793

 

Other, net

 

 

1,472

 

(6,398)

 

Change in operating assets and liabilities:

 

 

 

 

 

 

Current and other assets

 

 

(18,905)

 

43,222

 

Payables and other liabilities

 

 

(14,772)

 

(30,016)

 

Net cash provided (used) by operating activities

 

 

47,579

 

56,751

 

Cash flows from investing activities:

 

 

 

 

 

 

Capital expended for property and equipment

 

 

(67,382)

 

(70,866)

 

Proceeds from derivative instrument

 

 

 

105,866

 

Settlement of derivative instrument

 

 

 

(105,866)

 

Other investing activities, net

 

 

1,088

 

4,540

 

Net cash provided (used) by investing activities

 

 

(66,294)

 

(66,326)

 

Cash flows from financing activities:

 

 

 

 

 

 

Borrowings of debt

 

 

 

325,000

 

Repayment of debt, finance leases and tower obligations

 

 

(4,409)

 

(332,071)

 

Repurchases of GCI Liberty common stock

 

 

 

(43,910)

 

Other financing activities, net

 

 

(1,281)

 

(7,866)

 

Net cash provided (used) by financing activities

 

 

(5,690)

 

(58,847)

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

 

(24,405)

 

(68,422)

 

Cash, cash equivalents and restricted cash at beginning of period

 

 

576,150

 

492,032

 

Cash, cash equivalents and restricted cash at end of period

 

$

551,745

 

423,610

 

 

GCI Liberty, Inc. 
Courtnee Chun, 720-875-5420

Source: GCI Liberty, Inc.