Coudersport, Pa.-based MSO Adelphia Communications Corp.
reported record revenue and cash flow for the first quarter ended March 31, spurred mainly
by increases in its digital-cable and high-speed Internet offerings.
Pro forma revenue for the period increased by 15.6 percent
to $206.2 million, and pro forma cash flow rose 11 percent to $125.1 million.
In the cable segment, pro forma revenue rose 9 percent to
$250.8 million during the period, and operating cash flow jumped 11 percent.
Also on a pro forma basis, subscriber growth was about 1.5
percent during the first quarter of 1999.
Actual revenue for the cable segment during the period rose
38.2 percent to $184.8 million, and cash flow increased 38.9 percent to $97.9 million.
Digital subscribers rose by sevenfold to 39,433 during the
period, up from 4,976 in the same period last year.
Subscribers to the company's high-speed Internet
service, "Power Link," more than tripled to 12,662 from 4,262 last year.
In business telephony, Adelphia's Hyperion
Telecommunications Inc. subsidiary reported increases in access lines -- to 144,647 from
30,000 in the same period last year -- and revenue in the segment rose to $21.4 million
from $4.8 million.
Adelphia vice president of finance Jim Brown said in a
conference call with analysts that the company is investigating entering the residential
telephony market, but most likely not through Hyperion.
"We do think residential telephony will be a joint
venture," Brown said in the conference call. "We just don't know what form
it will take."
Adelphia executives have acknowledged beginning talks on a
telephony joint venture with AT&T Corp., but they have said they don't have a
clear idea of AT&T's offer yet.
This was the first quarter after Adelphia went on its most
recent acquisition binge, purchasing FrontierVision Partners L.P., Century Communications
Corp. and Harron Communications Corp. in deals valued at a total of $8.47 billion.
When completed, the deals will increase Adelphia's
subscriber base to 5 million, from 1.6 million before the transactions.
Adelphia chairman John Rigas said in a prepared statement,
"In addition to being very pleased with Adelphia's operating results for the
quarter, we were also very happy with the operating results of each of the companies being
acquired. The results for each company were fully in line with our expectations."
Adelphia has also tapped the public-debt markets, raising
$750 million in common and preferred equity from the public and the Rigas family, which
controls the bulk of Adelphia stock.
As a result of raising the additional equity,
Adelphia's pro forma debt-to-cash-flow ratio is below 6.9 for the first time in quite
a while, and the company expects that ratio to drop even further.
