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8-K
CHARTER COMMUNICATIONS, INC. /MO/ filed this Form 8-K on 10/26/2017
Entire Document
 

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,
 
2017
 
2016
 
2017
 
2016
 
Actual
 
Actual
 
Actual
 
Actual
 
 
 
 
 
 
 
 
Consolidated net income
$
92

 
$
250

 
$
498

 
$
3,176

Plus: Interest expense, net
788

 
724

 
2,250

 
1,771

Income tax (benefit) expense
26

 
16

 
99

 
(3,135
)
Depreciation and amortization
2,701

 
2,437

 
7,846

 
4,412

Stock compensation expense
64

 
81

 
198

 
168

Loss on extinguishment of debt

 

 
35

 
110

(Gain) loss on financial instruments, net
(17
)
 
(71
)
 
15

 
(16
)
Other pension (benefits) costs
17

 
(13
)
 
(9
)
 
(533
)
Other, net
148

 
212

 
388

 
786

 
 
 
 
 
 
 
 
Adjusted EBITDA (a)
3,819

 
3,636

 
11,320

 
6,739

Less: Purchases of property, plant and equipment
(2,393
)
 
(1,748
)
 
(6,096
)
 
(3,437
)
 
 
 
 
 
 
 
 
Adjusted EBITDA less capital expenditures
$
1,426

 
$
1,888

 
$
5,224

 
$
3,302

 
 
 
 
 
 
 
 
Net cash flows from operating activities
$
2,908

 
$
2,801

 
$
8,696

 
$
4,815

Less: Purchases of property, plant and equipment
(2,393
)
 
(1,748
)
 
(6,096
)
 
(3,437
)
Change in accrued expenses related to capital expenditures
79

 
(52
)
 
276

 
86

 
 
 
 
 
 
 
 
Free cash flow
$
594

 
$
1,001

 
$
2,876

 
$
1,464

 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30,
 
 
 
 
 
2017
 
2016
 
 
 
 
 
Actual
 
Pro Forma (b)
 
 
 
 
 
 
 
 
Consolidated net income
 
 
 
 
$
498

 
$
830

Plus: Interest expense, net
 
 
 
 
2,250

 
2,155

Income tax expense
 
 
 
 
99

 
288

Depreciation and amortization
 
 
 
 
7,846

 
7,060

Stock compensation expense
 
 
 
 
198

 
219

Loss on extinguishment of debt
 
 
 
 
35

 
110

(Gain) loss on financial instruments, net
 
 
 
 
15

 
(16
)
Other pension benefits
 
 
 
 
(9
)
 
(549
)
Other, net
 
 
 
 
388

 
514

 
 
 
 
 
 
 
 
Adjusted EBITDA (a)
 
 
 
 
11,320

 
10,611

Less: Purchases of property, plant and equipment
 
 
 
 
(6,096
)
 
(5,657
)
 
 
 
 
 
 
 
 
Adjusted EBITDA less capital expenditures
 
 
 
 
$
5,224

 
$
4,954



(a)
See pages 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 January 1, 2015.

The above schedule is 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 2017 Earnings Release
Page 7 of 8