Cablevision Systems Corporation Reports Fourth Quarter and Full Year 2012 Results

Cablevision Systems Corporation Reports Fourth Quarter and Full Year 2012 Results

Superstorm Sandy Impacts Fourth Quarter Results

BETHPAGE, N.Y.--(BUSINESS WIRE)-- Cablevision Systems Corporation (NYS: CVC) today reported financial results for the fourth quarter and full year ended December 31, 2012.

Fourth quarter consolidated net revenues decreased 1.6% to $1.664 billion, consolidated adjusted operating cash flow ("AOCF")¹ decreased 44.2% to $349.6 million and consolidated operating income decreased 91.5% to $29.3 million, all compared to the prior year period. Footnote 2 on page 4 of this release details certain items affecting the comparability of our results for 2012 and 2011. Excluding these items, consolidated net revenues would have increased 0.3% while AOCF and operating income would have decreased 18.4% and 48.7%, respectively, all compared to the prior year period.

For full year 2012, consolidated net revenues increased 0.1% to $6.705 billion, consolidated AOCF decreased 17.2% to $1.899 billion and consolidated operating income decreased 38.2% to $759.5 million, all compared to 2011. Footnote 2 on page 4 of this release details certain items affecting the comparability of our results for 2012 and 2011. Excluding these items, net revenue would have grown 0.4%, consolidated AOCF would have decreased 11.7% and operating income would have decreased 27.9%, compared to the prior full year period.

Operating highlights for the fourth quarter and full year 2012 include:

• Fourth quarter cable advertising revenue growth of 17.6%, compared to the prior year period.

• Improved full year combined Video, High-Speed Data and Voice customer net additions compared to 2011 despite impact of Superstorm Sandy in the fourth quarter.

Cablevision President and CEO James L. Dolan said, "2012 was a year of investment at Cablevision - investment in our network, in our products and services, and in our employees to ensure that we were providing our customers with the very best experience with their television, internet and phone services. The enormous challenges of Superstorm Sandy had a strong negative impact on our fourth quarter results. Ever resilient, our employees met those challenges, restored our system and now are focused on continuing to enhance our product portfolio to meet our customers' evolving needs and expectations."

See notes on page 4.

Telecommunications Services - Cable Television and Lightpath

Telecommunications Services includes Cable Television - Cablevision's video, high-speed data, and voice residential and commercial services offered over its cable infrastructure -- and its "Lightpath" branded commercial data and voice services.

Telecommunications Services net revenues for the fourth quarter 2012 decreased 1.9% to $1.550 billion, AOCF decreased 40.3% to $401.2 million and operating income decreased 73.2% to $114.3 million, all compared with the prior year period. Excluding the impact of the items highlighted in footnote 2 on page 4 of this release, revenue would have increased 0.1%, AOCF would have decreased 15.9% and operating income would have decreased 37.1%, compared to the prior year period.

Full year 2012 net revenues rose 0.2% to $6.292 billion, AOCF decreased 15.7% to $2.103 billion, and operating income decreased 30.4% to $1.059 billion, all as compared to the prior year period. Excluding the impact of the items highlighted in footnote 2 on page 4 of this release, revenue would have increased 0.5% while AOCF would have decreased 10.5% and operating income would have decreased 21.8%, compared to the prior year period.

Cable Television

Cable Television fourth quarter 2012 net revenues decreased 2.2% to $1.473 billion principally due to the impact of Superstorm Sandy as well as fewer video customers than the prior year period, offset by the continued growth of high-speed data and voice customers. AOCF decreased 42.0% to $368.9 million and operating income decreased 73.6% to $108.6 million, all compared with the prior year period. Excluding the impact of the items highlighted in footnote 2 on page 4 of this release, revenue would have been flat, AOCF would have decreased 17.1% and operating income would have decreased 37.2%, all compared to the prior year period. Fourth quarter 2012 AOCF results reflect higher operating expenses, primarily programming and non-executive employee related costs.

The following table illustrates the change in the Cable Television customer base during the fourth quarter of 2012, including the impact of Superstorm Sandy:

See notes on page 4.

Lightpath

For fourth quarter 2012, Lightpath net revenues increased 3.4% to $81.8 million, AOCF decreased 11.6% to $32.3 million and operating income decreased 64.4% to $5.7 million, each as compared to the prior year period. Fourth quarter results reflect a 13.2% increase in revenue from Ethernet services offset by higher operating expenses. Excluding certain items referenced in footnote 2 on page 4 of this release, AOCF would have increased 5.6% and operating income would have declined 33.4%, respectively.

Other

Other principally consists of Newsday, Clearview Cinemas, News 12 Networks, MSG Varsity, Cablevision Media Sales Corporation and certain other businesses and unallocated corporate costs.

Fourth quarter 2012 net revenues increased 2.3% to $119.7 million, AOCF deficit increased 12.3% to a deficit of $51.5 million and operating loss increased 5.1% to a loss of $85.0 million all compared with the prior year period. Excluding the impact of certain items highlighted in footnote 2 on page 4 of this release, revenue would have increased 2.4% while the AOCF deficit and operating loss would have increased 19.0% and 6.7%, respectively. The increase in AOCF deficit was due primarily to higher costs at Newsday and News 12 Networks offset by lower corporate costs.

Full year 2012 net revenues decreased 2.0% to $435.2 million, AOCF deficit increased 1.2% to a deficit of $203.8 million and operating loss increased 2.5% to a loss of $299.3 million. Excluding the impact of certain items highlighted in footnote 2 on page 4 of this release, the AOCF deficit and operating loss would have both increased 4.1%.

Other Matters

On February 26, 2013, the Board of Directors of Cablevision declared a quarterly dividend of $0.15 per share on each outstanding share of both its Cablevision NY Group Class A Stock and its Cablevision NY Group Class B Stock. This quarterly dividend is payable on April 3, 2013 to shareholders of record at the close of business on March 15, 2013.

During 2012, Cablevision repurchased approximately 13.6 million shares of its Class A common stock for approximately $188.6 million. There were no repurchases during the fourth quarter of 2012. As of December 31, 2012, the Company had approximately $455 million available under its stock repurchase authorization.

See notes on page 4.