Cox Delivers Solid Fourth Quarter


Amid the Comcast Corp.-Walt Disney Co. deal noise, Cox Communications Inc. reported solid fourth-quarter revenue growth of 12% and full-year growth of 14%, spurred by its bundling strategy.

"With laserlike focus on our operations, including a number of productivity initiatives, we generated significant improvement in operating-income margin and improved operating-cash-flow margin by 150 basis points in 2003," CEO Jim Robbins said in a prepared statement.

"Our bundling advantages and deployment of [video-on-demand], HDTV and [digital-video-recording] services further bolstered our video service against [direct-broadcast satellite] competition and will help us to drive continued growth in digital penetration in 2004," he added.

For the quarter, Cox generated $162 million in operating income and $561 million in cash flow on revenue of $1.5 billion.

For the full year, Cox generated $586 million in operating income and $2.1 billion in cash flow on $5.8 billion in revenue. For the year, Cox generated a 41% increase in operating income and a 19% increase in cash flow.

Cox added 82,967 digital subscribers in the quarter to end the year at 2.1 million. Data subscribers grew 144,402 to almost 2 million, while the MSO added a record 76,691 phone customers to end the year at just under 1 million. Cox said it added 75,000 DVR and HDTV subscribers from Oct. 1- Jan. 31.

The one chink in the numbers was lower average revenue per subscriber among high-speed-data subscribers. That metric dropped from $43 per month in the third quarter to $41.37 in the fourth quarter. A number of factors contributed to the drop, Cox said, including increased cable-modem purchases by consumers, higher self-install rates and bundling discounts.

Cox estimated that its 2004 revenue would rise 11.5%-12.5% and cash flow would rise 14%-15% as revenue-generating units grow by 1 million.