November 2, 2011

Comcast Reports 3rd Quarter 2011 Results

Strong Financial and Operating Momentum

Consolidated Revenue Increased 51.1%, Operating Cash Flow Increased 27.8% and Operating Income Increased 35.1%

Dividends and Share Repurchases Totaled $909 Million

PHILADELPHIA--(BUSINESS WIRE)-- Comcast Corporation (NASDAQ: CMCSA, CMCSK) today reported results for the quarter ended September 30, 2011.

Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation, said, "I am pleased to report strong performance across key financial, operational and product areas. Cable had an outstanding quarter, led by continuing strength in high-speed Internet and business services. In addition, this marks the fourth consecutive quarter of improving customer metrics, including increased year-over-year high-speed Internet customer additions. We are driving product leadership and innovation and making significant progress in delivering improved service experiences for our customers. NBCUniversal's results underscore the strength of our core cable networks business, as well as terrific momentum at the theme parks. Our goal for NBCUniversal is to improve and build brands, and to enhance long-term value. Overall, this quarter continued our momentum toward a successful integration."

       
($ in millions)

3rd Quarter

Year to Date

Consolidated Results

2010

 

2011

 

Growth

2010

 

2011*

 

Growth

 
Revenue $9,489 $14,339 51.1% $28,216 $40,800 44.6%
Operating Cash Flow (OCF) $3,578 $4,574 27.8% $10,880 $13,441 23.5%
Operating Income $1,954 $2,641 35.1% $5,967 $7,803 30.8%
Earnings per Share $0.31 $0.33 6.5% $0.93 $1.03 10.8%
Free Cash Flow $1,025 $1,392 35.8% $4,267 $5,133 20.3%
*Year to date 2011 includes 8 months of NBCUniversal results.
               
($ in millions)

3rd Quarter

Year to Date

Consolidated Pro Forma Results**

2010

2011

Growth

2010

2011

Growth

 
Revenue $13,670 $14,339 4.9% $40,453 $42,619 5.4%
Operating Cash Flow (OCF) $4,433 $4,574 3.2% $12,879 $13,810 7.2%
OCF*** (excluding Olympics and acquisition-related accounting revisions and costs) $4,433 $4,656 5.0% $13,102 $14,117 7.7%
** Pro forma results are presented as if the NBCUniversal transaction, which closed on January 28, 2011, and the Universal Orlando transaction, which closed on July 1, 2011, were effective on January 1, 2010. See Table 5 for additional details.
*** See Table 6.

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.

Consolidated Financial Results

Revenue increased 51.1% in the third quarter of 2011 to $14.3 billion, while Operating Cash Flow increased 27.8% to $4.6 billion and Operating Income increased 35.1% to $2.6 billion, primarily reflecting strong Cable Communications results, the acquisition of NBCUniversal in January and the consolidation of the Universal Orlando theme parks.

For the nine months ended September 30, 2011, revenue increased 44.6% to $40.8 billion, while operating cash flow increased 23.5% to $13.4 billion and operating income increased 30.8% to $7.8 billion.

Earnings per Share1 (EPS) for the third quarter of 2011 was $0.33, a 6.5% increase from the $0.31 reported in the third quarter of 2010. Excluding NBCUniversal transaction and related costs, EPS increased 3.1% (see Table 4). Third quarter EPS was negatively impacted by higher interest expense and taxes, as well as a $256 million year-over-year decline in investment income. This decline reflects a $147 million ($0.03 per share after tax) investment loss in third quarter 2011, compared to a $109 million ($0.02 per share after tax) investment gain in third quarter 2010, driven primarily by noncash mark-to-market adjustments on our investment portfolio.

EPS for the nine months ended September 30, 2011 was $1.03, a 10.8% increase from the $0.93 reported in the prior year. Excluding NBCUniversal transaction and related costs and a $137 million noncash, non-recurring income tax charge resulting from a state tax law change during the second quarter of 2011, EPS for the nine months ended September 30, 2011 increased 14.6% to $1.10 compared to $0.96 in 2010 (see Table 4).

Free Cash Flow (excluding any impact from the Economic Stimulus packages) increased 35.8% to $1.4 billion in the third quarter of 2011 compared to $1.0 billion in last year's third quarter. The increase in free cash flow primarily reflects growth in consolidated operating cash flow, partially offset by an increase in working capital. Free cash flow for the nine months ended September 30, 2011 increased 20.3% to $5.1 billion compared to $4.3 billion in 2010.

       
($ in millions)

3rd Quarter

Year to Date

Free Cash Flow

2010

 

2011

 

Growth

2010

 

2011*

 

Growth

Operating Cash Flow $3,578 $4,574 27.8% $10,880 $13,441 23.5%
Capital Expenditures (1,366) (1,408) 3.0% (3,429) (3,785) 10.4%
Cash Paid for Capitalized Software and Other Intangible Assets (135) (209) 54.8% (372) (505) 35.8%
Cash Interest Expense (661) (612) (7.4%) (1,630) (1,809) 11.0%
Cash Taxes (668) (596) (10.8%) (1,794) (1,166) (35.0%)
Changes in Operating Assets and Liabilities 60 (300) NM (10) (721) NM
Noncash Share-Based Compensation 73 86 17.8% 226 260 15.0%
Proceeds from Investments and Distributions to Noncontrolling Interests 18 (3) NM 63 (35) NM
Adjustments for Nonoperating Items 37   5   NM 65   (16)   NM
Free Cash Flow (Incl. Economic Stimulus Packages) $936 $1,537 64.2% $3,999 $5,664 41.6%
Economic Stimulus Packages 89   (145)   NM 268   (531)   NM
Free Cash Flow $1,025 $1,392 35.8% $4,267 $5,133 20.3%
* Includes 8 months of NBCUniversal results.
 

Note: The definition of Free Cash Flow excludes any impact from the 2008-2011 Economic Stimulus packages. These amounts have been excluded from Free Cash Flow to provide an appropriate comparison. NM=comparison not meaningful.

Share Repurchases and Dividends. During the third quarter of 2011, Comcast repurchased 27.5 million of its common shares for $600 million. Year to date, Comcast has repurchased 73.4 million of its common shares for $1.65 billion. As of September 30, 2011, Comcast had approximately $491 million of availability remaining under its share repurchase authorization. In addition, during the third quarter of 2011, Comcast paid dividends totaling $309 million.

Pro Forma Financial Results

Pro forma results are presented as if the NBCUniversal transaction, which closed on January 28, 2011, and the Universal Orlando transaction, which closed on July 1, 2011, were effective on January 1, 2010. These results are based on historical results of operations, adjusted for the effects of acquisition accounting and eliminating the costs and expenses directly related to the transaction, and are not necessarily indicative of what the results would have been had Comcast operated NBCUniversal and Universal Orlando since January 1, 2010 (see Table 5 for reconciliations of pro forma financial information).

Consolidated Pro Forma Revenue increased 4.9% in the third quarter of 2011 to $14.3 billion compared to $13.7 billion in the third quarter of 2010. Consolidated Pro Forma Operating Cash Flow increased 3.2% to $4.6 billion compared to $4.4 billion in last year's third quarter. Included in pro forma operating cash flow for the third quarter of 2011 are acquisition-related accounting revisions and costs totaling $82 million. Excluding these costs, pro forma consolidated operating cash flow increased 5.0% (see Table 6).

For the nine months ended September 30, 2011, consolidated pro forma revenue increased 5.4% to $42.6 billion compared to $40.5 billion in 2010. Excluding revenue generated by the 2010 Vancouver Olympics, pro forma revenue increased 7.4%. Consolidated pro forma operating cash flow increased 7.2% to $13.8 billion compared to $12.9 billion in the first nine months of 2010. Excluding the Olympics in 2010 and acquisition-related accounting revisions and costs, operating cash flow increased 7.7% (see Table 6).

Cable Communications

Pro forma Cable Communications ("Cable") results include video, high-speed internet, voice, advertising and business services operations and the businesses of Comcast Interactive Media that were not contributed to NBCUniversal. Pro forma Cable results exclude the regional sports networks, which were contributed to NBCUniversal.


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($ in millions) (pro forma)

3rd Quarter

Year to Date

2010

 

2011

 

Growth

2010

 

2011

 

Growth

Cable Communications Revenue
Video $4,839 $4,892 1.1% $14,525 $14,724 1.4%
High-Speed Internet 2,009 2,205 9.8% 5,926 6,497 9.6%
Voice 829 883 6.3% 2,458 2,621 6.6%
Advertising 512 492 (4.0%) 1,418 1,459 2.9%
Business Services 334 464 39.4% 903 1,293 43.3%
Other 362