Cable One Reports Fourth Quarter and Full Year 2023 Results

Cable One, Inc. (NYSE: CABO) (the “Company” or “Cable One”) today reported financial and operating results for the quarter and year ended December 31, 2023.

Three Months Ended December 31,

(dollars in thousands)

 

2023

 

 

2022

 

$ Change

% Change

Revenues

$

411,815

 

$

425,515

 

$

(13,700

)

(3.2

)%

Net income (loss)

$

115,294

 

$

(77,210

)

$

192,504

 

(249.3

)%

Net profit margin

 

28.0

%

 

(18.1

)%

 

 

Cash flows from operating activities

$

151,669

 

$

168,247

 

$

(16,578

)

(9.9

)%

Adjusted EBITDA⁽¹⁾

$

226,877

 

$

233,215

 

$

(6,338

)

(2.7

)%

Adjusted EBITDA margin⁽¹⁾

 

55.1

%

 

54.8

%

 

 

Capital expenditures

$

115,600

 

$

106,843

 

$

8,757

 

8.2

%

Adjusted EBITDA less capital expenditures⁽¹⁾

$

111,277

 

$

126,372

 

$

(15,095

)

(11.9

)%

	Year Ended December 31,
(dollars in thousands)		2023				2022			$ Change				% Change
Revenues	$	1,678,081			$	1,706,043			$	(27,962	)		(1.6	)%
Net income	$	267,436			$	234,118			$	33,318			14.2	%
Net profit margin		15.9	%			13.7	%
Cash flows from operating activities	$	663,170			$	738,040			$	(74,870	)		(10.1	)%
Adjusted EBITDA(1)	$	916,944			$	911,851			$	5,093			0.6	%
Adjusted EBITDA margin(1)		54.6	%			53.4	%
Capital expenditures	$	371,028			$	414,095			$	(43,067	)		(10.4	)%
Adjusted EBITDA less capital expenditures(1)	$	545,916			$	497,756			$	48,160			9.7	%

“Our return to sequential residential high-speed data customer growth in the fourth quarter, as expected, is very encouraging," said Julie Laulis, Cable One President and CEO. "Along with our highest margin residential data and business services product lines comprising over 77% of all revenues during the quarter, we look forward to executing on our business plan for 2024.”

Fourth Quarter 2023 Highlights:

• Net income was $115.3 million in the fourth quarter of 2023 compared to a net loss of $77.2 million in the fourth quarter of 2022. Adjusted EBITDA was $226.9 million in the fourth quarter of 2023 compared to $233.2 million in the fourth quarter of 2022. Net profit margin was 28.0% and Adjusted EBITDA margin was 55.1%.
• Net cash provided by operating activities was $151.7 million in the fourth quarter of 2023 compared to $168.2 million in the fourth quarter of 2022. Adjusted EBITDA less capital expenditures was $111.3 million in the fourth quarter of 2023 compared to $126.4 million in the fourth quarter of 2022.
• Total revenues were $411.8 million in the fourth quarter of 2023 compared to $425.5 million in the fourth quarter of 2022. Year-over-year, residential data revenues increased 2.1%.
• Residential data primary service units (“PSUs”) grew sequentially by over 1,600, or 0.2%, from the third quarter of 2023.
• Residential data average monthly revenue per unit (“ARPU”) was $83.95 for the fourth quarter of 2023, an increase of $2.24, or 2.7%, from the prior year quarter.
• The Company paid $16.8 million in dividends during the fourth quarter of 2023.
• The Company repaid $50.0 million under its revolving credit facility (the "Revolver") during the fourth quarter of 2023.

Full Year 2023 Highlights:

• Net income was $267.4 million in 2023 compared to $234.1 million in 2022. Adjusted EBITDA was $916.9 million in 2023 compared to $911.9 million in 2022. Net profit margin was 15.9% and Adjusted EBITDA margin was 54.6%.
• Net cash provided by operating activities was $663.2 million in 2023 compared to $738.0 million in 2022. Adjusted EBITDA less capital expenditures was $545.9 million in 2023 compared to $497.8 million in 2022.
• Total revenues were $1.7 billion in both 2023 and 2022. Year-over-year, residential data revenues increased 4.8%.
• Residential data ARPU was $84.57 for 2023, an increase of $3.45, or 4.3%, from the prior year.
• The Company repurchased 141,551 shares of its common stock at an aggregate cost of $99.6 million and paid $66.3 million in dividends during 2023. The Company had $143.1 million of remaining share repurchase authorization as of December 31, 2023.
• The Company repaid $150.0 million under the Revolver during 2023.

_______________

(1)

Adjusted EBITDA, Adjusted EBITDA margin and Adjusted EBITDA less capital expenditures are defined in the section of this press release entitled “Use of Non-GAAP Financial Measures.” Adjusted EBITDA and Adjusted EBITDA less capital expenditures are reconciled to net income (loss), Adjusted EBITDA margin is reconciled to net profit margin and Adjusted EBITDA less capital expenditures is also reconciled to net cash provided by operating activities. Refer to the “Reconciliations of Non-GAAP Measures” tables within this press release.

Fourth Quarter 2023 Financial Results Compared to Fourth Quarter 2022

Revenues decreased $13.7 million, or 3.2%, to $411.8 million for the fourth quarter of 2023 due primarily to decreases in residential video, residential voice and other revenues, partially offset by an increase in residential data revenues.

Net income was $115.3 million in the fourth quarter of 2023 compared to a net loss of $77.2 million in the prior year quarter. Net income for the fourth quarter of 2023 included a $66.6 million non-cash gain on fair value adjustment associated with the call and put options to acquire the remaining equity interests in Mega Broadband Investments Holdings LLC (the "MBI Net Option"). Net loss for the fourth quarter of 2022 included a $128.8 million non-cash loss on fair value adjustment associated with the MBI Net Option. Net profit margin was 28.0% in the fourth quarter of 2023 compared to negative 18.1% in the prior year quarter.

Adjusted EBITDA was $226.9 million and $233.2 million for the fourth quarter of 2023 and 2022, respectively. Adjusted EBITDA margin increased to 55.1% in the fourth quarter of 2023 from 54.8% in the prior year quarter.

Net cash provided by operating activities was $151.7 million in the fourth quarter of 2023 compared to $168.2 million in the fourth quarter of 2022. The decrease was driven primarily by higher income tax payments, unfavorable changes in the timing of working capital balances compared to the prior year and lower Adjusted EBITDA. Capital expenditures for the fourth quarter of 2023 totaled $115.6 million compared to $106.8 million for the fourth quarter of 2022. Adjusted EBITDA less capital expenditures for the fourth quarter of 2023 was $111.3 million compared to $126.4 million in the prior year quarter.

Full Year 2023 Financial Results Compared to Full Year 2022

Revenues decreased $28.0 million, or 1.6%, due primarily to decreases in residential video and residential voice revenues, partially offset by an increase in residential data revenues.

Net income was $267.4 million in 2023 compared to $234.1 million in the prior year. Net income for 2023 included a $28.0 million non-cash gain on fair value adjustment associated with the MBI Net Option, while net income for 2022 included a $40.7 million non-cash loss on fair value adjustment associated with the MBI Net Option. Net income for 2023 also included $54.3 million in net losses from the Company's pro rata share of earnings in equity method investments compared to $14.9 million in net losses in the prior year. Net profit margin was 15.9% in 2023 compared to 13.7% in the prior year.

Adjusted EBITDA was $916.9 million and $911.9 million for 2023 and 2022, respectively. Adjusted EBITDA margin increased to 54.6% in 2023 from 53.4% in the prior year.

Net cash provided by operating activities was $663.2 million in 2023 compared to $738.0 million in 2022. The decrease was driven by higher income tax and interest payments along with unfavorable changes in the timing of working capital balances compared to the prior year, partially offset by an increase in Adjusted EBITDA. Capital expenditures for 2023 totaled $371.0 million compared to $414.1 million for 2022. Adjusted EBITDA less capital expenditures for 2023 was $545.9 million compared to $497.8 million in the prior year.

Liquidity and Capital Resources

At December 31, 2023, the Company had $190.3 million of cash and cash equivalents on hand compared to $215.2 million at December 31, 2022. The Company’s debt balance was approximately $3.7 billion and $3.8 billion at December 31, 2023 and 2022, respectively. The Company had $338.0 million of borrowings and $662.0 million available for borrowing under its Revolver as of December 31, 2023.

The Company paid $16.8 million in dividends to stockholders during the fourth quarter of 2023. During 2023, the Company paid $66.3 million in dividends and repurchased 141,551 shares of its common stock at an aggregate cost of $99.6 million. The Company had $143.1 million of remaining share repurchase authorization as of December 31, 2023.

The Company repaid $50.0 million under its Revolver during the fourth quarter of 2023, bringing total repayments under the Revolver to $150.0 million during 2023. In February 2024, the Company repaid an additional $50.0 million under its Revolver.

The Company's capital expenditures by category were as follows for the periods presented (in thousands):

	Three Months Ended December 31,						Year Ended December 31,
		2023			2022			2023			2022
Customer premise equipment(1)	$	17,045		$	24,070		$	62,066		$	101,252
Commercial(2)		11,181			9,328			38,893			34,282
Scalable infrastructure(3)		26,441			6,029			54,097			52,086
Line extensions(4)		17,943			19,269			51,466			52,839
Upgrade/rebuild(5)		13,521			24,675			60,898			87,284
Support capital(6)		29,469			23,472			103,608			86,352
Total	$	115,600		$	106,843		$	371,028		$	414,095

_______________
(1)	Customer premise equipment includes costs incurred at customer locations, including installation costs and customer premise equipment (e.g., modems and set-top boxes).
(2)	Commercial includes costs related to securing business services customers and PSUs, including small and medium-sized businesses and enterprise customers.
(3)	Scalable infrastructure includes costs not related to customer premise equipment to secure growth of new customers and PSUs or provide service enhancements (e.g., headend equipment).
(4)	Line extensions include network costs associated with entering new service areas (e.g., fiber/coaxial cable, amplifiers, electronic equipment, make-ready and design engineering).
(5)	Upgrade/rebuild includes costs to modify or replace existing fiber/coaxial cable networks, including betterments.
(6)	Support capital includes costs associated with the replacement or enhancement of non-network assets due to technological and physical obsolescence (e.g., non-network equipment, land, buildings and vehicles) and capitalized internal labor costs not associated with customer installation activities.

Conference Call

Cable One will host a conference call with the financial community to discuss results for the fourth quarter and full year 2023 on Thursday, February 22, 2024, at 5 p.m. Eastern Time (ET).

The conference call will be available via an audio webcast on the Cable One Investor Relations website at ir.cableone.net or by dialing 1-888-800-3155 (International: 1-646-307-1696) and using the access code 1202376. Participants should register for the webcast or dial in for the conference call shortly before 5 p.m. ET.

A replay of the call will be available from February 22, 2024 until March 7, 2024 at ir.cableone.net.

Additional Information Available on Website

The information in this press release should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the period ended December 31, 2023 (the "2023 Form 10-K"), which will be posted on the “SEC Filings” section of the Cable One Investor Relations website at ir.cableone.net when it is filed with the Securities and Exchange Commission (the “SEC”). Investors and others interested in more information about Cable One should consult the Company’s website, which is regularly updated with financial and other important information about the Company.

Use of Non-GAAP Financial Measures

The Company uses certain measures that are not defined by generally accepted accounting principles in the United States (“GAAP”) to evaluate various aspects of its business. Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA less capital expenditures and capital expenditures as a percentage of Adjusted EBITDA are non-GAAP financial measures and should be considered in addition to, not as superior to, or as a substitute for, net income (loss), net profit margin, net cash provided by operating activities or capital expenditures as a percentage of net income (loss) reported in accordance with GAAP. Adjusted EBITDA and Adjusted EBITDA less capital expenditures are reconciled to net income (loss), Adjusted EBITDA margin is reconciled to net profit margin and capital expenditures as a percentage of Adjusted EBITDA is reconciled to capital expenditures as a percentage of net income (loss). Adjusted EBITDA less capital expenditures is also reconciled to net cash provided by operating activities. These reconciliations are included in the “Reconciliations of Non-GAAP Measures” tables within this press release.

“Adjusted EBITDA” is defined as net income (loss) plus interest expense, income tax provision, depreciation and amortization, equity-based compensation, severance and contract termination costs, (gain) loss on deferred compensation, acquisition-related costs, (gain) loss on asset sales and disposals, system conversion costs, (gain) loss on sales of businesses, equity method investment (income) loss, other (income) expense and other unusual items, as provided in the “Reconciliations of Non-GAAP Measures” tables within this press release. As such, it eliminates the significant non-cash depreciation and amortization expense that results from the capital-intensive nature of the Company’s business as well as other non-cash or special items and is unaffected by the Company’s capital structure or investment activities. This measure is limited in that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues and the Company’s cash cost of debt financing. These costs are evaluated through other financial measures.

“Adjusted EBITDA margin” is defined as Adjusted EBITDA divided by total revenues.

“Adjusted EBITDA less capital expenditures,” when used as a liquidity measure, is calculated as net cash provided by operating activities excluding the impact of capital expenditures, interest expense, income tax provision, changes in operating assets and liabilities, change in deferred income taxes and other unusual items, as provided in the “Reconciliations of Non-GAAP Measures” tables within this press release.

“Capital expenditures as a percentage of Adjusted EBITDA” is defined as capital expenditures divided by Adjusted EBITDA.

The Company uses Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA less capital expenditures and capital expenditures as a percentage of Adjusted EBITDA to assess its performance, and it also uses Adjusted EBITDA less capital expenditures as an indicator of its ability to fund operations and make additional investments with internally generated funds. In addition, Adjusted EBITDA generally correlates to the measure used in the leverage ratio calculations under the Company’s credit agreement and the indenture governing the Company’s non-convertible senior unsecured notes to determine compliance with the covenants contained in the credit agreement and the ability to take certain actions under the indenture governing the non-convertible senior unsecured notes. Adjusted EBITDA, capital expenditures as a percentage of Adjusted EBITDA, and Adjusted EBITDA less capital expenditures are also significant performance measures that have been used by the Company in its incentive compensation programs. Adjusted EBITDA does not take into account cash used for mandatory debt service requirements or other non-discretionary expenditures, and thus does not represent residual funds available for discretionary uses.

The Company believes that Adjusted EBITDA, Adjusted EBITDA margin and capital expenditures as a percentage of Adjusted EBITDA are useful to investors in evaluating the operating performance of the Company. The Company believes that Adjusted EBITDA less capital expenditures is useful to investors as it shows the Company’s performance while taking into account cash outflows for capital expenditures and is one of several indicators of the Company’s ability to service debt, make investments and/or return capital to its stockholders.

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA less capital expenditures, capital expenditures as a percentage of Adjusted EBITDA and similar measures with similar titles are common measures used by investors, analysts and peers to compare performance in the Company’s industry, although the Company’s measures of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA less capital expenditures and capital expenditures as a percentage of Adjusted EBITDA may not be directly comparable to similarly titled measures reported by other companies.

About Cable One

Cable One, Inc. (NYSE:CABO) is a leading broadband communications provider committed to connecting customers and communities to what matters most. Through Sparklight and the associated Cable One family of brands, the Company serves more than 1 million residential and business customers in 24 states. Powered by a fiber-rich network, the Cable One family of brands provide residential customers with a wide array of connectivity and entertainment services, including Gigabit speeds, advanced Wi-Fi and video. For businesses ranging from small and mid-market up to enterprise, wholesale and carrier, the Company offers scalable, cost-effective solutions that enable businesses of all sizes to grow, compete and succeed.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This communication may contain “forward-looking statements” that involve risks and uncertainties. These statements can be identified by the fact that they do not relate strictly to historical or current facts, but rather are based on current expectations, estimates, assumptions and projections about the Company’s industry, business, strategy, acquisitions and strategic investments, dividend policy, financial results and financial condition. Forward-looking statements often include words such as “will,” “should,” “anticipates,” “estimates,” “expects,” “projects,” “intends,” “plans,” “believes” and words and terms of similar substance in connection with discussions of future operating or financial performance. As with any projection or forecast, forward-looking statements are inherently susceptible to uncertainty and changes in circumstances. The Company’s actual results may vary materially from those expressed or implied in its forward-looking statements. Accordingly, undue reliance should not be placed on any forward-looking statement made by the Company or on its behalf. Important factors that could cause the Company’s actual results to differ materially from those in its forward-looking statements include government regulation, economic, strategic, political and social conditions and the following factors, which are discussed in the 2023 Form 10-K to be filed with the SEC:

• rising levels of competition from historical and new entrants in the Company’s markets;
• recent and future changes in technology, and the Company's ability to develop, deploy and operate new technologies, service offerings and customer service platforms;
• the Company’s ability to continue to grow its residential data and business services revenues and customer base;
• increases in programming costs and retransmission fees;
• the Company’s ability to obtain hardware, software and operational support from vendors;
• risks that the Company may fail to realize the benefits anticipated as a result of the Company's purchase of the remaining interests in Hargray Acquisition Holdings, LLC that the Company did not already own;
• risks relating to existing or future acquisitions and strategic investments by the Company;
• risks that the implementation of the Company’s new enterprise resource planning and billing systems disrupt business operations;
• the integrity and security of the Company’s network and information systems;
• the impact of possible security breaches and other disruptions, including cyber-attacks;
• the Company’s failure to obtain necessary intellectual and proprietary rights to operate its business and the risk of intellectual property claims and litigation against the Company;
• legislative or regulatory efforts to impose network neutrality and other new requirements on the Company’s data services;
• additional regulation of the Company’s video and voice services;
• the Company’s ability to renew cable system franchises;
• increases in pole attachment costs;
• changes in local governmental franchising authority and broadcast carriage regulations;
• changes in government subsidy programs;
• the potential adverse effect of the Company’s level of indebtedness on its business, financial condition or results of operations and cash flows;
• the restrictions the terms of the Company’s indebtedness place on its business and corporate actions;
• the possibility that interest rates will continue to rise, causing the Company’s obligations to service its variable rate indebtedness to increase significantly;
• risks associated with the Company’s convertible indebtedness;
• the Company’s ability to continue to pay dividends;
• provisions in the Company’s charter, by-laws and Delaware law that could discourage takeovers and limit the judicial forum for certain disputes;
• adverse economic conditions, labor shortages, supply chain disruptions, changes in rates of inflation and the level of move activity in the housing sector;
• pandemics, epidemics or disease outbreaks, such as the COVID-19 pandemic, have, and may in the future, disrupt the Company's business and operations, which could materially affect the Company's business, financial condition, results of operations and cash flows;
• lower demand for the Company's residential data and business services products;
• fluctuations in the Company’s stock price;
• dilution from equity awards, convertible indebtedness and potential future convertible debt and stock issuances;
• damage to the Company’s reputation or brand image;
• the Company’s ability to retain key employees (whom the Company refers to as associates);
• the Company’s ability to incur future indebtedness;
• provisions in the Company’s charter that could limit the liabilities for directors; and
• the other risks and uncertainties detailed from time to time in the Company’s filings with the SEC, including but not limited to those described under "Risk Factors" in its latest Annual Report on Form 10-K and in its subsequent filings with the SEC.

Any forward-looking statements made by the Company in this communication speak only as of the date on which they are made. The Company is under no obligation, and expressly disclaims any obligation, except as required by law, to update or alter its forward-looking statements, whether as a result of new information, subsequent events or otherwise.

CABLE ONE, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited)
	Three Months Ended December 31,
(dollars in thousands, except per share data)			2023					2022			$ Change					% Change
Revenues
Residential data	$		242,340			$		237,247			$		5,093			2.1	%
Residential video			59,247					75,256					(16,009	)		(21.3	)%
Residential voice			8,755					9,991					(1,236	)		(12.4	)%
Business services			75,879					76,287					(408	)		(0.5	)%
Other			25,594					26,734					(1,140	)		(4.3	)%
Total Revenues			411,815					425,515					(13,700	)		(3.2	)%
Costs and Expenses:
Operating (excluding depreciation and amortization)			106,265					112,617					(6,352	)		(5.6	)%
Selling, general and administrative			89,022					85,739					3,283			3.8	%
Depreciation and amortization			87,305					86,898					407			0.5	%
(Gain) loss on asset sales and disposals, net			1,994					1,584					410			25.9	%
Total Costs and Expenses			284,586					286,838					(2,252	)		(0.8	)%
Income from operations			127,229					138,677					(11,448	)		(8.3	)%
Interest expense			(42,381	)				(39,164	)				(3,217	)		8.2	%
Other income (expense), net			71,994					(122,873	)				194,867			(158.6	)%
Income (loss) before income taxes and equity method investment income (loss), net			156,842					(23,360	)				180,202			NM
Income tax provision			25,765					40,167					(14,402	)		(35.9	)%
Income (loss) before equity method investment income (loss), net			131,077					(63,527	)				194,604			NM
Equity method investment income (loss), net			(15,783	)				(13,683	)				(2,100	)		15.3	%
Net income (loss)	$		115,294			$		(77,210	)		$		192,504			(249.3	)%
Net Income (Loss) per Common Share:
Basic	$		20.56			$		(13.38	)		$		33.94			NM
Diluted	$		19.39			$		(13.38	)		$		32.77			(244.9	)%
Weighted Average Common Shares Outstanding:
Basic			5,606,607					5,769,537					(162,930	)		(2.8	)%
Diluted			6,025,092					5,769,537					255,555			4.4	%
Unrealized gain (loss) on cash flow hedges and other, net of tax	$		(35,624	)		$		(4,475	)		$		(31,149	)		NM
Comprehensive income (loss)	$		79,670			$		(81,685	)		$		161,355			(197.5	)%

_______________

NM = Not meaningful.

CABLE ONE, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited)
	Year Ended December 31,
(dollars in thousands, except per share data)			2023					2022			$ Change					% Change
Revenues
Residential data	$		979,296			$		934,564			$		44,732			4.8	%
Residential video			257,966					325,200					(67,234	)		(20.7	)%
Residential voice			37,088					43,096					(6,008	)		(13.9	)%
Business services			304,527					305,286					(759	)		(0.2	)%
Other			99,204					97,897					1,307			1.3	%
Total Revenues			1,678,081					1,706,043					(27,962	)		(1.6	)%
Costs and Expenses:
Operating (excluding depreciation and amortization)			440,916					470,916					(30,000	)		(6.4	)%
Selling, general and administrative			354,663					350,310					4,353			1.2	%
Depreciation and amortization			342,891					350,462					(7,571	)		(2.2	)%
(Gain) loss on asset sales and disposals, net			12,708					9,199					3,509			38.1	%
(Gain) loss on sales of businesses, net			—					(13,833	)				13,833			(100.0	)%
Total Costs and Expenses			1,151,178					1,167,054					(15,876	)		(1.4	)%
Income from operations			526,903					538,989					(12,086	)		(2.2	)%
Interest expense			(170,147	)				(137,713	)				(32,434	)		23.6	%
Other income (expense), net			54,640					(25,913	)				80,553			NM
Income before income taxes and equity method investment income (loss), net			411,396					375,363					36,033			9.6	%
Income tax provision			89,704					126,332					(36,628	)		(29.0	)%
Income before equity method investment income (loss), net			321,692					249,031					72,661			29.2	%
Equity method investment income (loss), net			(54,256	)				(14,913	)				(39,343	)		NM
Net income	$		267,436			$		234,118			$		33,318			14.2	%
Net Income per Common Share:
Basic	$		47.34			$		39.73			$		7.61			19.2	%
Diluted	$		45.14			$		38.06			$		7.08			18.6	%
Weighted Average Common Shares Outstanding:
Basic			5,648,934					5,892,077					(243,143	)		(4.1	)%
Diluted			6,062,331					6,314,148					(251,818	)		(4.0	)%
Unrealized gain (loss) on cash flow hedges and other, net of tax	$		(13,286	)		$		132,826			$		(146,112	)		(110.0	)%
Comprehensive income	$		254,150			$		366,944			$		(112,794	)		(30.7	)%

_______________

NM = Not meaningful.

CABLE ONE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(dollars in thousands, except par values)	December 31, 2023				December 31, 2022
Assets
Current Assets:
Cash and cash equivalents	$	190,289			$	215,150
Accounts receivable, net		93,973				74,383
Prepaid and other current assets		58,116				57,172
Total Current Assets		342,378				346,705
Equity investments		1,125,447				1,195,221
Property, plant and equipment, net		1,791,120				1,701,755
Intangible assets, net		2,595,892				2,666,585
Goodwill		928,947				928,947
Other noncurrent assets		63,149				74,677
Total Assets	$	6,846,933			$	6,913,890
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable and accrued liabilities	$	156,645			$	164,518
Deferred revenue		27,169				23,706
Current portion of long-term debt		19,023				55,931
Total Current Liabilities		202,837				244,155
Long-term debt		3,626,928				3,752,591
Deferred income taxes		974,467				966,821
Other noncurrent liabilities		169,556				192,350
Total Liabilities		4,973,788				5,155,917
Stockholders' Equity:
Preferred stock ($0.01 par value; 4,000,000 shares authorized; none issued or outstanding)		—				—
Common stock ($0.01 par value; 40,000,000 shares authorized; 6,175,399 shares issued; and 5,616,987 and 5,766,011 shares outstanding as of December 31, 2023 and 2022, respectively)		62				62
Additional paid-in capital		607,574				578,154
Retained earnings		1,825,542				1,624,406
Accumulated other comprehensive income (loss)		36,745				50,031
Treasury stock, at cost (558,412 and 409,388 shares held as of December 31, 2023 and 2022, respectively)		(596,778	)			(494,680	)
Total Stockholders' Equity		1,873,145				1,757,973
Total Liabilities and Stockholders' Equity	$	6,846,933			$	6,913,890

CABLE ONE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
	Three Months Ended December 31,								Year Ended December 31,
(in thousands)		2023				2022				2023				2022
Cash flows from operating activities:
Net Income	$	115,294			$	(77,210	)		$	267,436			$	234,118
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		87,305				86,898				342,891				350,462
Non-cash interest expense, net		2,215				2,394				9,019				9,518
Equity-based compensation		7,601				5,498				29,420				22,514
Write-off of debt issuance costs		—				—				3,340				—
Change in deferred income taxes		11,344				35,906				11,479				68,378
(Gain) loss on asset sales and disposals, net		1,994				1,584				12,708				9,199
(Gain) loss on sales of businesses, net		—				—				—				(13,833	)
Equity method investment (income) loss, net		15,783				13,683				54,256				14,913
Fair value adjustments		(66,591	)			128,420				(39,514	)			40,400
Changes in operating assets and liabilities:
Accounts receivable, net		(7,642	)			(9,776	)			(19,590	)			2,734
Prepaid and other current assets		3,045				10,877				(2,227	)			(3,971	)
Accounts payable and accrued liabilities		(17,902	)			(25,264	)			(10,664	)			(157	)
Deferred revenue		(91	)			95				3,463				(389	)
Other		(686	)			(4,858	)			1,153				4,154
Net cash provided by operating activities		151,669				168,247				663,170				738,040
Cash flows from investing activities:
Cash paid for debt and equity investments		(13,890	)			(25,310	)			(29,410	)			(50,385	)
Capital expenditures		(115,600	)			(106,843	)			(371,028	)			(414,095	)
Change in accrued expenses related to capital expenditures		2,630				(627	)			3,324				3,358
Purchase of wireless licenses		(2,750	)			—				(2,750	)			—
Proceeds from sales of property, plant and equipment		168				19				1,230				3,628
Proceeds from sales of equity investments		—				—				56,730				—
Proceeds from sales of operations		—				—				—				9,227
Net cash used in investing activities		(129,442	)			(132,761	)			(341,904	)			(448,267	)
Cash flows from financing activities:
Proceeds from long-term debt borrowings		—				—				638,000				—
Payment of debt issuance costs		—				—				(8,096	)			—
Payments on long-term debt		(54,711	)			(13,083	)			(807,633	)			(38,845	)
Repurchases of common stock		—				(46,258	)			(99,614	)			(353,289	)
Payment of withholding tax for equity awards		(93	)			(210	)			(2,484	)			(5,036	)
Dividends paid to stockholders		(16,766	)			(16,504	)			(66,300	)			(66,255	)
Net cash used in financing activities		(71,570	)			(76,055	)			(346,127	)			(463,425	)
Change in cash and cash equivalents		(49,343	)			(40,569	)			(24,861	)			(173,652	)
Cash and cash equivalents, beginning of period		239,632				255,719				215,150				388,802
Cash and cash equivalents, end of period	$	190,289			$	215,150			$	190,289			$	215,150
Supplemental cash flow disclosures:
Cash paid for interest, net of capitalized interest	$	45,131			$	43,556			$	160,224			$	127,158
Cash paid for income taxes, net of refunds received	$	16,151			$	4,882			$	92,456			$	23,379

CABLE ONE, INC. RECONCILIATIONS OF NON-GAAP MEASURES (Unaudited)
	Three Months Ended December 31,
(dollars in thousands)		2023				2022			$ Change				% Change
Net income (loss)	$	115,294			$	(77,210	)		$	192,504			(249.3	)%
Net profit margin		28.0	%			(18.1	)%
Plus: Interest expense		42,381				39,164				3,217			8.2	%
Income tax provision		25,765				40,167				(14,402	)		(35.9	)%
Depreciation and amortization		87,305				86,898				407			0.5	%
Equity-based compensation		7,601				5,498				2,103			38.3	%
Severance and contract termination costs		1,673				—				1,673			NM
(Gain) loss on deferred compensation		—				51				(51	)		(100.0	)%
Acquisition-related costs		473				424				49			11.6	%
(Gain) loss on asset sales and disposals, net		1,994				1,584				410			25.9	%
System conversion costs		602				83				519			NM
Equity method investment (income) loss, net		15,783				13,683				2,100			15.3	%
Other (income) expense, net		(71,994	)			122,873				(194,867	)		(158.6	)%
Adjusted EBITDA	$	226,877			$	233,215			$	(6,338	)		(2.7	)%
Adjusted EBITDA margin		55.1	%			54.8	%
Less: Capital expenditures	$	115,600			$	106,843			$	8,757			8.2	%
Capital expenditures as a percentage of net income (loss)		100.3	%			(138.4	)%
Capital expenditures as a percentage of Adjusted EBITDA		51.0	%			45.8	%
Adjusted EBITDA less capital expenditures	$	111,277			$	126,372			$	(15,095	)		(11.9	)%

_______________

NM = Not meaningful.

	Three Months Ended December 31,
(dollars in thousands)		2023				2022			$ Change				% Change
Net cash provided by operating activities	$	151,669			$	168,247			$	(16,578	)		(9.9	)%
Capital expenditures		(115,600	)			(106,843	)			(8,757	)		8.2	%
Interest expense		42,381				39,164				3,217			8.2	%
Non-cash interest expense		(2,215	)			(2,394	)			179			(7.5	)%
Income tax provision		25,765				40,167				(14,402	)		(35.9	)%
Changes in operating assets and liabilities		23,276				28,926				(5,650	)		(19.5	)%
Change in deferred income taxes		(11,344	)			(35,906	)			24,562			(68.4	)%
(Gain) loss on deferred compensation		—				51				(51	)		(100.0	)%
Acquisition-related costs		473				424				49			11.6	%
Severance and contract termination costs		1,673				—				1,673			NM
System conversion costs		602				83				519			NM
Fair value adjustments		66,591				(128,420	)			195,011			(151.9	)%
Other (income) expense, net		(71,994	)			122,873				(194,867	)		(158.6	)%
Adjusted EBITDA less capital expenditures	$	111,277			$	126,372			$	(15,095	)		(11.9	)%

_______________

NM = Not meaningful.

CABLE ONE, INC. RECONCILIATIONS OF NON-GAAP MEASURES (Unaudited)
	Year Ended December 31,
(dollars in thousands)		2023				2022			$ Change				% Change
Net income	$	267,436			$	234,118			$	33,318			14.2	%
Net profit margin		15.9	%			13.7	%
Plus: Interest expense		170,147				137,713				32,434			23.6	%
Income tax provision		89,704				126,332				(36,628	)		(29.0	)%
Depreciation and amortization		342,891				350,462				(7,571	)		(2.2	)%
Equity-based compensation		29,420				22,514				6,906			30.7	%
Severance and contract termination costs		2,890				—				2,890			NM
(Gain) loss on deferred compensation		—				(154	)			154			(100.0	)%
Acquisition-related costs		1,331				3,208				(1,877	)		(58.5	)%
(Gain) loss on asset sales and disposals, net		12,708				9,199				3,509			38.1	%
System conversion costs		801				1,466				(665	)		(45.4	)%
(Gain) loss on sales of businesses, net		—				(13,833	)			13,833			(100.0	)%
Equity method investment (income) loss, net		54,256				14,913				39,343			NM
Other (income) expense, net		(54,640	)			25,913				(80,553	)		NM
Adjusted EBITDA	$	916,944			$	911,851			$	5,093			0.6	%
Adjusted EBITDA margin		54.6	%			53.4	%
Less: Capital expenditures	$	371,028			$	414,095			$	(43,067	)		(10.4	)%
Capital expenditures as a percentage of net income		138.7	%			176.9	%
Capital expenditures as a percentage of Adjusted EBITDA		40.5	%			45.4	%

_______________

NM = Not meaningful.

	Year Ended December 31,
(dollars in thousands)		2023				2022			$ Change				% Change
Net cash provided by operating activities	$	663,170			$	738,040			$	(74,870	)		(10.1	)%
Capital expenditures		(371,028	)			(414,095	)			43,067			(10.4	)%
Interest expense		170,147				137,713				32,434			23.6	%
Non-cash interest expense		(9,019	)			(9,518	)			499			(5.2	)%
Income tax provision		89,704				126,332				(36,628	)		(29.0	)%
Changes in operating assets and liabilities		27,865				(2,371	)			30,236			NM
Write-off of debt issuance costs		(3,340	)			—				(3,340	)		NM
Change in deferred income taxes		(11,479	)			(68,378	)			56,899			(83.2	)%
(Gain) loss on deferred compensation		—				(154	)			154			(100.0	)%
Acquisition-related costs		1,331				3,208				(1,877	)		(58.5	)%
Severance and contract termination costs		2,890				—				2,890			NM
System conversion costs		801				1,466				(665	)		(45.4	)%
Fair value adjustment		39,514				(40,400	)			79,914			(197.8	)%
Other (income) expense, net		(54,640	)			25,913				(80,553	)		NM
Adjusted EBITDA less capital expenditures	$	545,916			$	497,756			$	48,160			9.7	%

_______________

NM = Not meaningful.

CABLE ONE, INC. OPERATING STATISTICS (Unaudited)
		As of December 31,
(in thousands, except percentages and ARPU data)			2023				2022			Change				% Change
Homes Passed			2,774.9				2,704.3				70.6			2.6	%
Residential Customers			994.4				1,010.2				(15.8	)		(1.6	)%
Data PSUs			960.5				963.7				(3.3	)		(0.3	)%
Video PSUs			134.2				171.2				(37.1	)		(21.6	)%
Voice PSUs			79.2				91.3				(12.1	)		(13.3	)%
Total residential PSUs			1,173.8				1,226.3				(52.4	)		(4.3	)%
Business Customers			102.6				101.6				1.1			1.1	%
Data PSUs			98.8				96.6				2.2			2.3	%
Video PSUs			8.1				10.3				(2.2	)		(21.7	)%
Voice PSUs			39.5				40.8				(1.3	)		(3.1	)%
Total business services PSUs			146.4				147.7				(1.3	)		(0.9	)%
Total Customers			1,097.0				1,111.7				(14.7	)		(1.3	)%
Total non-video			952.3				927.2				25.1			2.7	%
Percent of total			86.8	%			83.4	%						3.4	%
Data PSUs			1,059.3				1,060.4				(1.1	)		(0.1	)%
Video PSUs			142.3				181.5				(39.3	)		(21.6	)%
Voice PSUs			118.7				132.1				(13.4	)		(10.1	)%
Total PSUs			1,320.2				1,374.0				(53.8	)		(3.9	)%
Penetration
Data			38.2	%			39.2	%						(1.0	)%
Video			5.1	%			6.7	%						(1.6	)%
Voice			4.3	%			4.9	%						(0.6	)%
Share of Fourth Quarter Revenues
Residential data			58.8	%			55.8	%						3.0	%
Business services			18.4	%			17.9	%						0.5	%
Total			77.3	%			73.7	%						3.6	%
ARPU - Fourth Quarter
Residential data(1)		$	83.95			$	81.71			$	2.24			2.7	%
Residential video(1)		$	143.78			$	138.56			$	5.22			3.8	%
Residential voice(1)		$	36.24			$	35.69			$	0.55			1.5	%
Business services(2)		$	246.35			$	249.78			$	(3.43	)		(1.4	)%

Note:	All totals, percentages and year-over-year changes are calculated using exact numbers. Minor differences may exist due to rounding.
(1)	ARPU values represent the applicable quarterly residential service revenues (excluding installation and activation fees) divided by the corresponding average of the number of PSUs at the beginning and end of each period, divided by three, except that for any PSUs added or subtracted as a result of an acquisition or divestiture occurring during the period, the associated ARPU values represent the applicable residential service revenues (excluding installation and activation fees) divided by the pro-rated average number of PSUs during such period.
(2)	ARPU values represent quarterly business services revenues divided by the average of the number of business customer relationships at the beginning and end of each period, divided by three, except that for any business customer relationships added or subtracted as a result of an acquisition or divestiture occurring during the period, the associated ARPU values represent business services revenues divided by the pro-rated average number of business customer relationships during such period.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240222930038/en/

The Cable One Stock at the time of publication of the news with a fall of -2,00 % to 440EUR on Lang & Schwarz stock exchange (22. Februar 2024, 22:23 Uhr).