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WOW! Announces Results for the Third Quarter Ended September 30, 2015WOW! Internet, Cable & Phone ("WOW!"), a leading, fully-integrated provider of residential and commercial high-speed data, video and telephony services to customers in the United States, announced today financial and operating results for the third quarter ended September 30, 2015. Financial & Operating Highlights (1) For the third quarter ended September 30, 2015, WOW! reported Total Revenue of $297.7 million and Adjusted EBITDA of $109.6 million representing (i) a year-over-year decrease in Total Revenue of $4.3 million (or 1.4%) and an increase in Adjusted EBITDA of $9.1 million (or 9.1%) over the Pro Forma Total Revenue and Pro Forma Adjusted EBITDA for the third quarter ended September 30, 2014, respectively. The Pro Forma adjustments give effect to the sale of our South Dakota systems on September 30, 2014, as if the transaction had occurred at the beginning of the respective periods presented. On an LTM basis, Total Revenue for the twelve month period ended September 30, 2015 was $1.225 billion, a year-over-year increase of $35.5 million (or 3.0%) from the Pro Forma twelve month period ended September 30, 2014. Adjusted EBITDA for the twelve month period ended September 30, 2015 was $439.7 million, a year-over-year increase of $34.1 million (or 8.4%) from the Pro Forma twelve month period ended September 30, 2014. Conference Call WOW! will host a conference call on Friday, November 13, 2015 at 10:00 a.m. Eastern to discuss the operating and financial results contained in this press release. Conference call information is as follows:
A recording of the conference call will be available approximately two hours after the completion of the call until December 13, 2015. Dial in # for this replay is (855) 859-2056. Additionally, a copy of the transcript will be available approximately forty-eight hours after the call, at www.wowway.com/investor-relations. About WOW! WOW! is one of the nation's leading providers of high-speed Data, cable TV, and phone serving communities in the U.S. Our operating philosophy is to deliver an employee and customer experience that lives up to its name. WOW! is privately owned and controlled by Avista Capital Partners. For more information, please visit www.wowway.com.
The unaudited condensed consolidated statements of operations above and the information in this release should be read in conjunction with our Form 10-K for the year ended December 31, 2014 filed with the U.S. Securities and Exchange Commission ("SEC") on March 27, 2015. For ease of use, references in this release to "WOW! Internet, Cable & Phone" or "WOW!" mean WideOpenWest Finance, LLC and its consolidated subsidiaries. The unaudited condensed consolidated statements of operations above for the three months ended September 30, 2014 include the results of operations for South Dakota ("South Dakota") which were sold on September 30, 2014. See "Unaudited Pro Forma Condensed Combined Financial, Operating & Customer Information" below for a presentation of unaudited information for the quarter ended September 30, 2014 giving effect to the sale of South Dakota on September 30, 2014 as if such transaction had been completed at the beginning of the respective periods presented herein. Forward-Looking Statements This release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, are forward-looking statements. Forward-looking statements are not guarantees of future performance and we caution you not to place undue reliance on such statements. Forward-looking statements are generally identifiable by the use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend," "project," "continue," or the negative of these words, or other similar words or terms. The forward-looking statements included in this release are made as of the date hereof. You should review our filings with the SEC, including the section titled "Risk Factors" contained in our Annual Report on Form 10-K for the year ended December 31, 2014 as filed with the SEC on March 27, 2015. Actual results may differ materially from those expected because of various risks and uncertainties, many of which are beyond our control. Except as required by law, we assume no obligation to publicly update any forward-looking statement, even if new information becomes available in the future. Definitions of Non-GAAP Financial Measures and Operating Metrics We have included certain non-GAAP financial measures in this release including Adjusted EBITDA and Pro Forma Adjusted EBITDA. We believe that these non-GAAP measures enhance an investor's understanding of our financial performance. We believe that these non-GAAP measures are useful financial metrics to assess our operating performance from period to period by excluding certain items that we believe are not representative of our core business. We believe that these non-GAAP measures provide investors with useful information for assessing the comparability between periods of our ability to generate cash from operations sufficient to pay taxes, to service debt and to undertake capital expenditures. We use these non-GAAP measures for business planning purposes and in measuring our performance relative to that of our competitors. We believe these non-GAAP measures are measures commonly used by investors to evaluate our performance and that of our competitors. Adjusted EBITDA is defined by WOW! as net income (loss) before net interest expense, income taxes, depreciation and amortization (including impairments), gains (losses) realized and unrealized on derivative instruments, management fees to related party, the write-up or write-off/disposal of any asset, debt modification expenses, loss on extinguishment of debt, integration and restructuring expenses and all non-cash charges and expenses (including equity based compensation expense) and certain other income and expenses, as further defined in our credit facilities. Adjusted EBITDA is not a presentation made in accordance with generally accepted accounting principles in the United States of America ("GAAP") and our use of the term Adjusted EBITDA varies from others in our industry. Adjusted EBITDA should not be considered as an alternative to net income (loss), operating income or any other performance measures derived in accordance with GAAP as measures of operating performance or operating cash flows, or as measures of liquidity. Adjusted EBITDA has important limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. For example, Adjusted EBITDA:
See "Unaudited Reconciliations of GAAP Measures to Non-GAAP Measures" and the accompanying tables below for reconciliations of Adjusted EBITDA to our net income (loss), which is the most directly comparable GAAP financial measure. Furthermore, Adjusted EBITDA in this release is sometimes presented on a Pro Forma basis, giving effect to the sale of South Dakota on September 30, 2014 as if such transaction had been completed at the beginning of the respective periods presented (see "Unaudited Pro Forma Condensed Combined Financial, Operating & Customer Information" below for a complete discussion). In addition, we use the following operating and customer metrics in this release:
Subscriber information for acquired entities is preliminary and subject to adjustment until we have completed our review of such information and determined that it is presented in accordance with our policies. Unaudited Reconciliations of GAAP Measures to Non-GAAP Measures The following table provides an unaudited reconciliation of our net income (loss) to Adjusted EBITDA for the respective quarters ended and for the twelve month period ended September 30, 2015:
Unaudited Pro Forma Condensed Combined Financial, Operating & Customer Information The unaudited pro forma condensed combined financial, operating and customer information for the respective periods presented herein has been prepared giving effect to the sale of South Dakota ("South Dakota") on September 30, 2014 as if such transaction had been completed at the beginning of the respective periods presented herein by applying pro forma adjustments to the individual historical unaudited condensed consolidated financial statements and operating and customer information of South Dakota. Accordingly, the unaudited pro forma condensed combined financial, operating and customer information presented herein, excludes the unaudited financial results, operating and customer information for South Dakota for the period from July 1, 2014 to September 30, 2014. The historical consolidated financial, operating and customer information has been adjusted to give effect to pro forma events that are (1) directly attributable to such transactions, (2) factually supportable and (3) expected to have a continuing impact on the combined results. The unaudited pro forma condensed combined financial, operating and customer information is for informational purposes only and does not represent what our results of operations, operating and customer information would have been if the transaction had occurred at any date, nor does such information project the results of operations for any future period. The unaudited pro forma condensed combined statements of operations do not reflect non-recurring charges that have been incurred in connection with the transaction, including any related financing fees, legal fees, broker fees and accounting fees. The following table provides an unaudited reconciliation of our Total Revenue to Pro Forma Total Revenue, Adjusted EBITDA to Pro Forma Adjusted EBITDA and Capital Expenditures to Pro Forma Capital Expenditures for the respective quarters ended September 30, 2015:
The unaudited pro forma condensed combined financial information presented above should be read in conjunction with the information contained in "Management's Discussion and Analysis of Financial Condition and Results of Operations," the consolidated financial statements and the accompanying notes appearing in our Annual Report on Form 10-K for the year ended December 31, 2014 as filed with the SEC on March 27, 2015. The following table provides an unaudited reconciliation of our reported operating, total customer, subscriber and Total RGU data to Pro Forma operating, total customer, subscriber and RGU data as of September 30, 2015:
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