Cablevision Beats Expectations In Q1


Cablevision Systems kept up the industry's first-quarter earnings momentum Thursday, reporting strong results across all metrics, including a return to basic-subscriber additions.
Cablevision also added 900 basic video subscribers in the quarter -- the only publicly traded MSO to report positive basic sub growth - as well as 12,000 additional digital-cable customers. High-speed Internet subscribers rose by 42,600 in the period and Cablevision added another 42,300 phone customers.
The customer growth helped fuel a 5.6% increase in revenue to $1.3 billion at the telecommunications division and a 7.8% bump in adjusted operating cash flow to $593.4 million.
Overall, including its Rainbow Media programming arm and Newsday, revenue was up 5.2% to $1.8 billion and AOCF advanced 7.6% to $610.4 million. Free cash flow rose 32% to $240.5 million.
The rise in free cash flow prompted Cablevision to increase its quarterly dividend by 25% to 12.5 cents per share from 10 cents per share.
Cablevision's strong performance was the latest in a string of positive first-quarter results for cable companies. On April 28, Comcast reported in line revenue and cash flow growth and added 399,000 high-speed Internet customers, far exceeding analysts' expectations.  On April 29, Time Warner Cable outpaced estimates with 212,000 high-speed data additions.
On a conference call with analysts, Cablevision CEO James Dolan said he was pleased with the results.
"We're off to a very solid start," Dolan said.
Analysts agreed.
In a research note, Sanford Bernstein cable and satellite analyst Craig Moffett called the results outstanding, noting that Cablevision beat analysts' consensus estimates soundly. Moffett was particularly impressed with the basic- subscriber additions -- he noted that Cablevision has more video customers today (3.06 million) than when Verizon Communications first began rolling out its FiOS TV product in 2003 (2.9 million). Although Cablevision has the highest exposure to FiOS among the other publicly traded cable operators, Moffett noted that the worst may be over for the company on the telco competition front.