Mediacom Communications Corp. (MCCC) filed Quarterly Report for the period ended 2009-09-30.
Mediacom Communications is the nation's eigth largest cable television company and one of the leading cable operators focused on serving the smaller cities and towns in the United States. Mediacom Communications offers a wide array of broadband products and services including traditional video services digital television video-on-demand digital video recorders high-definition television high-speed Internet access and phone service. Mediacom Communications Corp. has a market cap of $328.5 million; its shares were traded at around $4.87 with a P/E ratio of 18.1 and P/S ratio of 0.2. Mediacom Communications Corp. had an annual average earning growth of 12.1% over the past 5 years.
Highlight of Business Operations:
On August 25, 2009, the operating subsidiaries of Mediacom LLC entered into an incremental facility agreement that provides for a new term loan under their existing credit facility in the principal amount of $300.0 million (the “new term loan”). Mediacom LLC is one of our two principal subsidiaries through which we own and operate cable systems. On the same date, Mediacom LLC and its wholly-owned subsidiary, Mediacom Capital Corporation, jointly issued 91/8% Senior Notes due August 2019 (the “91/8% Notes”) in the aggregate principal amount of $350.0 million. . Net proceeds from the issuance of the 91/8% Notes and borrowings under the new term loan were an aggregate of $626.1 million, after giving effect to original issue discount and financing costs. The net proceeds were used to fund tender offers and redemption of Mediacom LLC’s existing 77/8% Senior Notes due 2011 (the “77/8% Notes”) and 91/2% Senior Notes due 2013 (the “91/2% Notes” and, together with the 77/8% Notes, the “Notes”) See Note 7 in our Notes to Consolidated Financial Statements.
Interest expense, net, decreased 3.0%, primarily due to lower market interest rates on variable rate debt, offset in part by higher average indebtedness. As of September 30, 2009, our total debt was $3.375 billion, with a weighted average cost of debt of 5.7%, compared to $3.260 billion, with a weighted average cost of debt of 6.9% as of the same date last year.
As of September 30, 2009, we had interest rate exchange agreements, or interest rate swaps, with an aggregate notional amount of $2.1 billion, of which $1.0 billion are forward-starting interest rate swaps. These swaps have not been designated as hedges for accounting purposes. The changes in their mark-to-market values are derived primarily from changes in market interest rates and the decrease in their time to maturity. As a result of the quarterly mark-to-market valuation of these interest rate swaps, we recorded a net loss on derivatives of $5.2 million and a net gain on derivatives of $6.0 million, based upon information provided by our counterparties, for the three months ended September 30, 2009 and 2008, respectively.
Other expense, net, was $2.3 million and $5.8 million for the three months ended September 30, 2009 and 2008, respectively. During the three months ended September 30, 2009, other expense, net, consisted of $1.3 million of commitment fees, which includes $0.4 million of commitment fees related to the delayed funding of the new term loan, $0.9 million of deferred financing costs and $0.1 million of other fees. During the three months ended September 30, 2008, other expense, net, consisted of $3.0 million of transaction costs related to the repurchase of our Class A common stock (see Note 11 in our Notes to Consolidated Financial Statements), $1.3 million of commitment fees, $1.3 million of deferred financing costs and $0.2 million of other fees.
As a result of the factors described above, we recognized a net loss of $10.0 million for the three months ended September 30, 2009, compared to net income of $2.2 million for the prior year period.
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