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SEC Filings

10-Q
CHARTER COMMUNICATIONS, INC. /MO/ filed this Form 10-Q on 07/27/2017
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primarily due to a decrease in equity issued for the acquisition of Legacy TWC and Legacy Bright House in 2016 and an increase in the purchase of treasury stock and noncontrolling interest in 2017.

Capital Expenditures

We have significant ongoing capital expenditure requirements.  Capital expenditures were $2.1 billion and $3.7 billion for the three and six months ended June 30, 2017, respectively, and $1.3 billion and $1.7 billion for the three and six months ended June 30, 2016, respectively.  The increase was driven by the Transactions. On a pro forma basis, assuming the Transactions occurred as of January 1, 2015, capital expenditures increased $73 million and decreased $206 million during the three and six months ended June 30, 2017, respectively, compared to the corresponding periods in 2016. The decrease during the six months ended June 30, 2017 compared to 2016 was primarily due to lower scalable infrastructure costs and support primarily due to the timing of spend offset by higher spend on customer premise equipment. See the table below for more details.
 
The actual amount of our capital expenditures in 2017 will depend on a number of factors, including the pace of transition planning to service a larger customer base as a result of the Transactions, our all-digital transition in the Legacy TWC and Legacy Bright House markets and growth rates of both our residential and commercial businesses.

Our capital expenditures are funded primarily from cash flows from operating activities and borrowings on our credit facility. In addition, our accrued liabilities related to capital expenditures increased by $197 million and $138 million for the six months ended June 30, 2017 and 2016, respectively.

The following tables present our major capital expenditures categories on an actual and pro forma basis, assuming the Transactions occurred as of January 1, 2015, in accordance with National Cable and Telecommunications Association (“NCTA”) disclosure guidelines for the three and six months ended June 30, 2017 and 2016. The disclosure is intended to provide more consistency in the reporting of capital expenditures among peer companies in the cable industry. These disclosure guidelines are not required disclosures under GAAP, nor do they impact our accounting for capital expenditures under GAAP (dollars in millions):

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
 
Actual
Customer premise equipment (a)
$
1,017

 
$
378

 
$
1,724

 
$
515

Scalable infrastructure (b)
382

 
386

 
650

 
496

Line extensions (c)
297

 
171

 
545

 
218

Upgrade/rebuild (d)
145

 
110

 
252

 
151

Support capital (e)
307

 
215

 
532

 
309

Total capital expenditures
$
2,148

 
$
1,260

 
$
3,703

 
$
1,689

 
 
 
 
 
 
 
 
Capital expenditures included in total related to:
 
 
 
 
 
 
 
Commercial services
$
334

 
$
196

 
$
602

 
$
260

Transition (f)
$
86

 
$
111

 
$
162

 
$
164



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