Comcast Reports 2nd Quarter 2013 Results

Comcast Reports 2nd Quarter 2013 Results

Consolidated Revenue Increased 7.0%, Operating Cash Flow Increased 8.4% and Operating Income Increased 11.6%


Earnings per Share Increased 30.0% to $0.65

Free Cash Flow Increased 25.4% to $1.9 Billion

Quarterly Dividends and Share Repurchases Totaled $1.0 Billion

PHILADELPHIA--(BUSINESS WIRE)-- Comcast Corporation (NASDAQ: CMCSA, CMCSK) today reported results for the quarter ended June 30, 2013.

Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation, said, "We are pleased with our results this quarter. Cable had outstanding growth, particularly in high-speed Internet, and NBCUniversal had strong performance across all of its businesses. Our focus on delivering innovative products and a superior customer experience is driving our success, including stronger video, voice and business services results in cable. NBCUniversal has real momentum, with solid growth in revenue and double-digit cash flow growth. We have a fantastic combination of cable and content businesses with many opportunities ahead."

       

Consolidated Financial Results

         
  2nd Quarter Year to Date
($ in millions)   2012   2013   Growth         2012   2013   Growth
Revenue   $ 15,211   $ 16,270   7.0 %         $ 30,089   $ 31,580   5.0 %
Operating Cash Flow (OCF)1   $ 5,004   $ 5,425   8.4 %         $ 9,692   $ 10,459   7.9 %
Operating Income   $ 3,079   $ 3,435   11.6 %         $ 5,837   $ 6,502   11.4 %
Earnings per Share2   $ 0.50   $ 0.65   30.0 %         $ 0.94   $ 1.19   26.6 %
Free Cash Flow3 $ 1,554   $ 1,948   25.4 % $ 4,593   $ 5,086   10.7 %
 

For additional detail on segment revenue and expenses, customer metrics, capital expenditures, and free cash flow, please refer to the trending schedules on Comcast's Investor Relations website at www.cmcsa.com or www.cmcsk.com.

Revenue for the second quarter of 2013 increased 7.0% to $16.3 billion. Operating Cash Flow increased 8.4% to $5.4 billion and Operating Income increased 11.6% to $3.4 billion.

For the six months ended June 30, 2013, revenue increased 5.0% to $31.6 billion. Excluding $259 million of revenue generated by the NFL's Super Bowl in the first quarter of 2012, revenue increased 5.9% (see Table 5). Operating cash flow increased 7.9% to $10.5 billion and operating income increased 11.4% to $6.5 billion.

Earnings per Share (EPS) for the second quarter of 2013 was $0.65, a 30.0% increase from the $0.50 reported in the second quarter of 2012.

EPS for the six months ended June 30, 2013 was $1.19, a 26.6% increase from the $0.94 reported in the prior year. Excluding a $0.03 per share gain in the first quarter of 2013 on the sale of wireless spectrum licenses, EPS increased 23.4% (see Table 4).

Capital Expenditures increased 17.1% to $1.5 billion in the second quarter of 2013 compared to the second quarter of 2012. Cable Communications' capital expenditures increased $116 million, or 10.4%, to $1.2 billion in the second quarter of 2013, primarily reflecting increased spending on customer premises equipment, such as advanced digital boxes and wireless gateways, our ongoing investment in network infrastructure and the expansion of business services. Cable capital expenditures represented 11.9% of Cable revenue in the second quarter of 2013 compared to 11.4% in last year's second quarter. NBCUniversal's capital expenditures increased $104 million to $260 million in the second quarter of 2013, primarily reflecting increased investments in Theme Parks.

For the six months ended June 30, 2013, capital expenditures increased 16.5% to $2.9 billion compared to the prior year. Cable Communications capital expenditures increased $154 million, or 7.1%, to $2.3 billion and represented 11.3% of Cable revenue compared to 11.2% in 2012. NBCUniversal's capital expenditures increased $256 million to $523 million for the first six months of 2013.

Free Cash Flow (excluding any impact from the Economic Stimulus packages) increased 25.4% to $1.9 billion in the second quarter of 2013 compared to the second quarter of 2012, reflecting growth in consolidated operating cash flow and improvements in working capital, partially offset by higher taxes and capital expenditures. Free cash flow for the six months ended June 30, 2013 increased 10.7% to $5.1 billion compared to $4.6 billion in 2012.

   
2nd Quarter Year to Date
($ in millions)   2012   2013   Growth   2012   2013   Growth
Operating Cash Flow   $ 5,004     $ 5,425     8.4 %   $ 9,692     $ 10,459     7.9 %
Capital Expenditures     (1,287 )     (1,506 )   17.1 %     (2,461 )     (2,867 )   16.5 %
Cash Paid for Capitalized Software and Other Intangible Assets     (230 )     (262 )   13.9 %     (414 )     (444 )   7.2 %
Cash Interest Expense     (544 )     (515 )   (5.3 %)     (1,158 )     (1,132 )   (2.2 %)
Cash Taxes     (904 )     (1,761 )   94.8 %     (1,022 )     (2,222 )   117.4 %
Changes in Operating Assets and Liabilities     (305 )     49     NM       41       418     NM  
Other     (13 )     530     NM       82       886     NM  
Free Cash Flow (Incl. Economic Stimulus Packages)   $ 1,721     $ 1,960     13.9 %   $ 4,760     $ 5,098     7.1 %
Economic Stimulus Packages     (167 )     (12 )   NM       (167 )     (12 )   NM  
Free Cash Flow $ 1,554   $ 1,948   25.4 % $ 4,593   $ 5,086   10.7 %

 

Note: The definition of Free Cash Flow excludes any impact from Economic Stimulus packages. These amounts have been excluded from Free Cash Flow to provide an appropriate comparison. "Other" in 2013 is substantially comprised of adjustments for cash taxes paid related to certain nonoperating transactions, as well as cash taxes paid in 2013 related to 2012 taxable income that were reflected as a reduction of 2012 Free Cash Flow.

NM=comparison not meaningful.

Dividends and Share Repurchases. During the second quarter of 2013, Comcast paid dividends totaling $514 million and repurchased 12.6 million of its common shares for $500 million. In the first six months of 2013, Comcast has repurchased 25.9 million of its common shares for $1.0 billion. As of June 30, 2013, Comcast had approximately $2.5 billion available under its share repurchase authorization.

         

Cable Communications

             
2nd Quarter Year to Date
($ in millions)   2012   2013   Growth         2012   2013   Growth
Cable Communications Revenue                              
Video   $ 5,039     $ 5,175     2.7 %         $ 9,968     $ 10,288     3.2 %
High-Speed Internet     2,380       2,569     8.0 %           4,703       5,092     8.3 %
Voice     889       910     2.4 %           1,767       1,810     2.5 %
Business Services     623       788     26.4 %           1,204       1,529     26.9 %
Advertising     551       558     1.2 %           1,026       1,046     1.9 %
Other     415       467     12.3 %           828       919     10.9 %
Cable Communications Revenue $ 9,897   $ 10,467   5.8 % $ 19,496   $ 20,684   6.1 %
                               
Cable Communications OCF   $ 4,101     $ 4,335     5.7 %         $ 8,056     $ 8,554     6.2 %
OCF Margin 41.4 % 41.4 % 41.3 % 41.4 %
                               
Cable Communications Capital Expenditures   $ 1,124     $ 1,240     10.4 %         $ 2,180     $ 2,334     7.1 %
Percent of Cable Communications Revenue 11.4 % 11.9 % 11.2 % 11.3 %
 

Revenue for Cable Communications increased 5.8% to $10.5 billion in the second quarter of 2013 compared to $9.9 billion in the second quarter of 2012, driven by increases of 8.0% in high-speed Internet, 26.4% in business services and 2.7% in video. The increase in revenue reflects rate adjustments, customers receiving higher levels of services and customer growth (see below).

For the six months ended June 30, 2013, Cable revenue increased 6.1% to $20.7 billion compared to $19.5 billion in 2012.

Combined Video, High-Speed Internet and Voice Customers increased by 189,000 in the second quarter of 2013, a 36.8% increase in net additions compared to second quarter 2012, reflecting growth in high-speed Internet and voice customers and reduced losses in video customers. As of June 30, 2013, video, high-speed Internet and voice customers totaled 52.1 million, an increase of 1.6 million or 3.1% over last year's second quarter.

  Customers         Net Adds
(in thousands)   2Q12   2Q13         2Q12 2Q13
Video Customers   22,118   21,776         (176 ) (159 )
High-Speed Internet Customers   18,738  

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