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SEC Filings

S-1/A
CHARTER COMMUNICATIONS, INC. /MO/ filed this Form S-1/A on 11/01/1999
Entire Document
 
<PAGE>   53
 
              NOTES TO UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
 
     NOTE A:  Pro forma operating results for Charter Communications Holding
Company consist of the following (dollars in thousands):
 

<TABLE>
<CAPTION>
                                                                   HISTORICAL
                                                         ------------------------------
                                                             1/1/99
                                                             THROUGH          1/1/99
                                                             6/30/99          THROUGH
                                                             CHARTER          3/31/99
                                                         COMMUNICATIONS       MARCUS        PRO FORMA
                                                         HOLDING COMPANY    HOLDINGS(A)    ADJUSTMENTS      TOTAL
                                                         ---------------    -----------    -----------    ---------
<S>                                                      <C>                <C>            <C>            <C>
Revenues...............................................     $ 468,993        $125,180        $    --      $ 594,173
                                                            ---------        --------        -------      ---------
Operating expenses:
  Operating, general and administrative................       241,341          68,984             --        310,325
  Depreciation and amortization........................       249,952          51,688         11,981(b)     313,621
  Stock option compensation expense....................        38,194              --             --         38,194
  Corporate expense charges............................        11,073              --             --         11,073
  Management fees......................................            --           4,381         (4,381)(c)         --
                                                            ---------        --------        -------      ---------
    Total operating expenses...........................       540,560         125,053          7,600        673,213
                                                            ---------        --------        -------      ---------
Income (loss) from operations..........................       (71,567)            127         (7,600)       (79,040)
Interest expense.......................................      (157,669)        (27,067)           867(d)    (183,869)
Interest income........................................        10,085             104             --         10,189
Other income (expense).................................         2,840            (158)            --          2,682
                                                            ---------        --------        -------      ---------
Loss before extraordinary item.........................     $(216,311)       $(26,994)       $(6,733)     $(250,038)
                                                            =========        ========        =======      =========
</TABLE>

 
---------------
 
(a) Marcus Holdings represents the results of operations of Marcus Holdings
    through March 31, 1999, the date of its merger with Charter Holdings.
 
(b) As a result of Mr. Allen acquiring a controlling interest in Marcus Cable, a
    large portion of the purchase price was recorded as franchises ($2.5
    billion) that are amortized over 15 years. This resulted in additional
    amortization for the period from January 1, 1999 through March 31, 1999. The
    adjustment to depreciation and amortization expense consists of the
    following (dollars in millions):
 

<TABLE>
<CAPTION>
                                                                            WEIGHTED AVERAGE
                                                                              USEFUL LIFE       DEPRECIATION/
                                                              FAIR VALUE       (IN YEARS)       AMORTIZATION
                                                              ----------    ----------------    -------------
<S>                                                           <C>           <C>                 <C>
Franchises..................................................   $2,500.0            15              $ 40.8
Cable distribution systems..................................      720.0             8                21.2
Land, buildings and improvements............................       28.3            10                 0.7
Vehicles and equipment......................................       13.6             3                 1.0
                                                                                                   ------
  Total depreciation and amortization.......................                                         63.7
  Less -- historical depreciation and amortization of Marcus
    Cable...................................................                                        (51.7)
                                                                                                   ------
    Adjustment..............................................                                       $ 12.0
                                                                                                   ======
</TABLE>

 
(c) Reflects the elimination of management fees.
 
(d) As a result of the acquisition of Marcus Cable by Mr. Allen, the carrying
    value of outstanding debt was recorded at estimated fair value, resulting in
    a debt premium that is to be amortized as an offset to interest expense over
    the term of the debt. This resulted in a reduction of interest expense.
 
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