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SEC Filings

S-4/A
RENAISSANCE MEDIA GROUP LLC filed this Form S-4/A on 08/06/1998
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  THREE MONTHS ENDED MARCH 31, 1998 COMPARED WITH THREE MONTHS ENDED MARCH 31,
1997
 
   The Systems served 127,191 basic subscribers at March 31, 1998 compared
with 125,016 basic subscribers at March 31, 1997, an increase of 2,175
subscribers or 1.7%. Homes passed increased to 179,402 at March 31, 1998 from
176,617 at March 31, 1997, an increase of 2,785 homes or 1.6%. Premium service
units decreased to 61,053 at March 31, 1998 from 63,890 at March 31, 1997.
 
  Revenues. Revenues increased $1.5 million, or 12.3%, to $14.0 million for
the three months ended March 31, 1998 from $12.4 million for the three months
ended March 31, 1997.
 
  The increase in revenues for the three months ended March 31, 1998 resulted
primarily from increases in basic revenue and other revenue. Basic revenue
increased due to an increase in the weighted average monthly subscription rate
for basic service to $7.88 in 1998 from $7.69 in 1997 and an increase in the
weighted average monthly subscription rate for CPST to $20.28 in 1998 from
$17.33 in 1997. In addition, basic revenue increased due to the increase in
subscribers in 1998. Other revenue components including home shopping, pay-
per-view and advertising revenue increased, while additional outlet revenue
decreased.
 
  System Operating Expenses. System operating expenses increased $.2 million,
or 4.0%, to $6.0 million for the three months ended March 31, 1998 from $5.8
million for the three months ended March 31, 1997. The increase in system
operating expenses for the three months ended March 31, 1998 resulted
primarily from increases in programming costs, offset in part by decreases in
repairs, maintenance, advertising, contract labor and bad debt expense.
 
  Operating Income. Operating income increased $1.3 million, or 103.4%, to
$2.6 million for the three months ended March 31, 1998 from $1.3 million for
the three months ended March 31, 1997.
 
  This increase resulted from the increase in revenues for the three months
ended March 31, 1998 of $1.5 million, offset in part by the increase in system
operating expenses of $.2 million for the three months ended March 31, 1998.
 
  Income Tax (Benefit) Expense. Income tax (benefit) expense increased $.5
million, or 80.7%, to $1.2 million for the three months ended March 31, 1998
from $.7 million for the three months ended March 31, 1997. This increase was
due to the increase in operating income for the three months ended March 31,
1998.
 
  Net Income. For the reasons discussed above, net income increased $.8
million, or 126.6%, to $1.5 million for the three months ended March 31, 1998
from $.6 million for the three months ended March 31, 1997.
 
LIQUIDITY AND CAPITAL RESOURCES
 
  From January 4, 1996 until April 9, 1998, the Systems were owned by Time
Warner and their liquidity and capital resources needs were evaluated and met
based upon funding from Time Warner. The Systems' cash balances were generally
minimized with excess cash balances transferred to corporate cash management
accounts.
 
  The cable television business requires substantial capital for the
upgrading, expansion and maintenance of signal distribution equipment, as well
for home subscriber devices and wiring and for service vehicles. The Company
will continue to deploy fiber optic technology and to upgrade the Systems to a
minimum of 550 MHz and to 750 MHz where system characteristics warrant. The
deployment of fiber optic technology will allow the Company to complete future
upgrades to the Systems in a cost-effective manner. In addition, the Company
believes that the application of digital compression technology will likely
reduce the requirement in the future for upgrades to increase capacity beyond
750 MHz.
 
  The working capital requirements of a cable television business are
generally not significant since subscribers are billed for services monthly in
advance, while the majority of expenses incurred (except for payroll) are paid
generally 30 to 60 days after their incurrence.
 
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