Vogel: ’04 a Year of Growth for Charter5/11/2004 3:16 AM Eastern
Calling 2003 a transition year, Charter Communications Inc. CEO Carl Vogel vowed to make 2004 a year of growth after reporting first-quarter results that met analysts’ expectations but still lagged far behind the rest of the cable industry.
Revenue rose 5% in the quarter to $1.185 billion and cash flow was up 3% to $450 million. Other cable operators that have already reported first-quarter financial results averaged 11.9% revenue and 13.3% cash-flow growth.
On a conference call with analysts, Vogel said Charter has lagged behind its peers in terms of deploying new services like digital-video recorders, HDTV and cable telephony due to its focus on restructuring its debt, which is still the highest in the industry.
“We took this approach because 2003 was a year of transition operationally and we had some constraints on what could be done as a result of our capital structure,” Vogel said on a conference call with analysts.
“This will be a year in which we look to regain our operational momentum, accelerate the deployment of advanced services and close the gap in terms of growth rates in revenue and [cash flow] relative to our peers in the second half of 2004,” he added.
Charter is beginning to build that momentum, adding 68,800 digital-cable subscribers and 125,000 high-speed-Internet customers in the quarter. Basic subscribers declined by 8,500 in the period, but that was an improvement from the 41,000 basic customers the MSO lost in the fourth quarter.
Charter said it has significantly increased the number of data-only customers on its rolls.
Charter added 37,000 data-only customers in the first quarter, a move senior vice president of sales and marketing Kip Simonson said would help the company to sell its entire service bundle to those subscribers in the future.
“The long-term strategy is actually just building the bundle from a different direction,” Simonson said on the conference call.