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8-K
CHARTER COMMUNICATIONS, INC. /MO/ filed this Form 8-K on 11/03/2016
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CHARTER COMMUNICATIONS, INC. AND SUBSIDIARIES
UNAUDITED RECONCILIATION OF NON-GAAP MEASURES TO GAAP MEASURES
(dollars in millions)
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2016
 
2015
 
2016
 
2015
 
Actual
 
Actual
 
Actual
 
Actual
 
 
 
 
 
 
 
 
Consolidated net income (loss)
$
250

 
$
54

 
$
3,176

 
$
(149
)
Plus: Interest expense, net
724

 
353

 
1,771

 
871

Income tax (benefit) expense
16

 
(142
)
 
(3,135
)
 
(72
)
Depreciation and amortization
2,437

 
538

 
4,412

 
1,580

Stock compensation expense
81

 
20

 
168

 
58

Loss on extinguishment of debt

 

 
110

 
128

(Gain) loss on financial instruments, net
(71
)
 
5

 
(16
)
 
10

Other, net
199

 
22

 
253

 
72

 
 
 
 
 
 
 
 
Adjusted EBITDA (a)
3,636

 
850

 
6,739

 
2,498

Less: Purchases of property, plant and equipment
(1,748
)
 
(509
)
 
(3,437
)
 
(1,292
)
 
 
 
 
 
 
 
 
Adjusted EBITDA less capital expenditures
$
1,888

 
$
341

 
$
3,302

 
$
1,206

 
 
 
 
 
 
 
 
Net cash flows from operating activities
$
2,801

 
$
689

 
$
4,815

 
$
1,748

Less: Purchases of property, plant and equipment
(1,748
)
 
(509
)
 
(3,437
)
 
(1,292
)
Change in accrued expenses related to capital expenditures
(52
)
 
28

 
86

 
11

 
 
 
 
 
 
 
 
Free cash flow
$
1,001

 
$
208

 
$
1,464

 
$
467

 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2016
 
2015
 
2016
 
2015
 
Actual
 
Pro Forma (b)
 
Pro Forma (b)
 
Pro Forma (b)
 
 
 
 
 
 
 
 
Consolidated net income
$
250

 
$
40

 
$
830

 
$
146

Plus: Interest expense, net
724

 
724

 
2,155

 
2,270

Income tax expense
16

 
1

 
288

 
19

Depreciation and amortization
2,437

 
2,356

 
7,060

 
6,961

Stock compensation expense
81

 
62

 
219

 
184

Loss on extinguishment of debt

 

 
110

 
128

(Gain) loss on financial instruments, net
(71
)
 
5

 
(16
)
 
10

Other, net
199

 
(13
)
 
(35
)
 
(132
)
 
 
 
 
 
 
 
 
Adjusted EBITDA (a)
3,636

 
3,175

 
10,611

 
9,586

Less: Purchases of property, plant and equipment
(1,748
)
 
(1,699
)
 
(5,657
)
 
(5,138
)
 
 
 
 
 
 
 
 
Adjusted EBITDA less capital expenditures
$
1,888

 
$
1,476

 
$
4,954

 
$
4,448



(a)
See page 1 and 2 of this addendum for detail of the components included within adjusted EBITDA.
(b)
Pro forma results reflect certain acquisitions of cable systems in 2016 as if they occurred as of the earliest period presented.

The above schedules are presented in order to reconcile adjusted EBITDA and free cash flows, both non-GAAP measures, to the most directly comparable GAAP measures in accordance with Section 401(b) of the Sarbanes-Oxley Act.

Addendum to Charter Communications, Inc. Third Quarter 2016 Earnings Release
Page 7 of 8