June was a much better month for Adelphia Communications Corp., with cash flow rising 33.4% and revenue up 7.7%, but subscriber losses — heavy between March and May — appeared to show no signs of subsiding.
Adelphia reported cash flow, or earnings before interest, taxes, depreciation and amortization (EBITDA), of almost $100 million in June, according to financial documents submitted to the U.S. Bankruptcy Court for the Southern District of New York on July 25.
That's up 33.4%, from $74.9 million in May.
But Adelphia lost about 22,000 subscribers in June, from 5.138 million customers to 5.116 million — almost twice the 12,000 subscribers it lost in May. Since March 31, Adelphia has shed about 184,000 basic subscribers.
Most of that decline is due to a low percentage of upgraded plant — Adelphia has said about 75% of its plant is fully upgraded, compared to 90% to 95% for its MSO peers — as well as intense competition from satellite TV and the stigma attached to bankruptcy. Adelphia filed for Chapter 11 bankruptcy protection in June 2002.
Spokesman Paul Jacobson said that another factor was troop deployments related to the Iraq war, especially in Colorado Springs. Two military bases in the area — the U.S. Army's Fort Carson and the U.S. Air Force's Peterson Air Force base — deployed 13,000 and 1,000 troops, respectively, in the late spring "and some subset of those numbers hit the June report."
The U.S. Air Force Academy in Colorado Springs also deployed a "couple of hundred" personnel to Iraq.
Adelphia has been working hard to right those declines. New chairman and CEO William Schleyer and president and COO Ron Cooper have pledged to accelerate upgrades and restore profitability.
Cooper's objective is to boost total upgraded plant to at least 90% by mid- to late 2004 — about the same time Adelphia plans to emerge from bankruptcy protection.
Part of their strategy is to focus on more-profitable customers. It appears that strategy made some strides in June: digital subscribers were up 0.6% to 1.78 million in June from 1.77 million in May. High-speed data growth was 3% in the period, to 781,073 customers from 758,543 in May.