- Grew Revenue and Modified EBITDA sequentially and year over year
- Achieved 37% M-EBITDA margin, a 160 basis point expansion year over year
- Delivered strong Levered Free Cash Flow, while investing in growth opportunities
LITTLETON, Colo., May 10 /PRNewswire-FirstCall/ — tw telecom inc. (NASDAQ:TWTC – News), a leading provider of managed voice, Internet and data networking solutions for business customers, today announced its first quarter 2010 financial results, including $311.2 million of revenue, $114.2 million in Modified EBITDA(1) (“M-EBITDA”), $17.5 million in levered free cash flow(3) and net loss of $4.5 million. Excluding debt extinguishment costs from a successful refinancing, the Company delivered $0.08 earnings per share for the quarter.
(Logo: http://www.newscom.com/cgi-bin/prnh/20080626/LATH527LOGO)
“We delivered great results in a historically seasonal quarter,” said Larissa Herda, tw telecom’s Chairman, CEO and President. “We grew revenue, delivered strong margins, and generated ongoing cash flow, while we strategically invested and maintained healthy liquidity. As part of our growth initiatives for this year, we have developed enhancements to our comprehensive product portfolio. We are currently selling these expanded products, and expect to begin to see revenue contribution in the latter part of the year. In addition, we continue to invest in new customer opportunities, expand our market reach and develop new capabilities. Our initiatives are focused on leveraging our infrastructure, capturing greater market share, accelerating revenue growth and driving shareholder value.”
Highlights for the First Quarter 2010
- Grew total revenue 5% year over year and 1% sequentially
- Grew enterprise revenue 6% year over year and 2% sequentially
- Grew data and Internet revenue 15% year over year and 3% sequentially
- Grew M-EBITDA 9% year over year
- Achieved a 36.7% M-EBITDA margin, a 160 basis point improvement year over year
- Delivered $17.5 million of levered free cash flow, representing 6% of revenue
- Successfully completed an opportunistic financing extending the maturity date and lowering weighted average cost of debt
Business Trends
“We delivered strong comprehensive results including strong revenue growth, impressive margins and solid cash flow,” said Mark Peters, tw telecom’s Executive Vice President and Chief Financial Officer. “Our revenue growth this quarter was benefited by a substantial decline in revenue churn. While it’s too early to determine if these favorable churn results are sustainable, we believe our focus on customer satisfaction, ongoing process improvements and targeted churn initiatives, will continue to benefit revenue. We also delivered strong bookings(7) for December through April, reflecting strength and consistency to our monthly sales, outpacing our previous results for any consecutive five month period.”
Bookings generally install in 45 days to 6 months after contract signature, therefore the Company expects that most of the sales in the first quarter will install in future quarters.
In March, the Company refinanced nearly one third of its debt issuing $430 million of 8% unsecured senior notes due in 2018, and redeeming $400 million of 9.25% unsecured senior notes due in 2014.
Operational Metrics
Revenue churn(4) was 0.9% for the current quarter, 1.2% for the prior quarter, and 1.3% for the same quarter last year. As a component of revenue churn, revenue lost from customers fully disconnecting service remained low at 0.2% for the current quarter, down from 0.3% for the prior quarter and the same quarter last year, reflecting a strong and stable customer base.
The Company had nearly 28,000 customers as of March 31, 2010. Customer churn(4) was 1.1% for the current quarter, down from 1.2% for the prior quarter and 1.3% for the same period last year. The majority of the turnover was from small customers, and the Company expects this churn will continue.
The Company ended the first quarter with over 27,000 route miles (including more than 20,000 metro miles), 10,647 buildings on net(6) and 2,887 employees, including 523 sales associates.
Other Trends
The Company continues to expect business fluctuations to impact sequential trends in revenue, margins and cash flow. This includes the timing as well as any seasonal nature of sales and installations, usage, disputes, repricing for contract renewals, and fluctuations in revenue churn, expenses and capital expenditures.
Capital Expenditures
Capital expenditures were $80.9 million for the quarter compared to $72.3 million for the prior quarter and $73.4 million for the same period last year. The sequential and year over year increase reflects investing in new product portfolio enhancements and ongoing success-based investments.
The Company expects capital investments for 2010 to be at the high end of its guidance range of $275 to $300 million, with greater investing in the first half of the year due to spending for product portfolio enhancements. The Company expects the majority of the full year capital investments to be tied to new sales opportunities.
Year over Year Results – First Quarter 2010 compared to First Quarter 2009
Revenue
Revenue for the quarter was $311.2 million compared to $297.6 million for the first quarter last year, representing a year over year increase of $13.6 million, or 5%. Key changes in revenue included:
- $13.6 million increase in revenue from enterprise customers, or 6% year over year, representing 31 consecutive quarters of enterprise growth
- $0.1 million increase in revenue from carriers reflecting growth in new sales partially offset by churn and repricing for contract renewals
- $0.1 million decrease in intercarrier compensation
By product line, the percentage change in revenue year over year was as follows:
- 15% increase for data and Internet services, primarily due to continued success with Ethernet and IP-based product sales, partially offset by churn
- 1% increase in voice services, primarily reflecting local product sales and an increase in certain taxes and fees, partially offset by churn
- 5% decrease for network services, primarily due to sales that were outpaced by churn and repricing for contract renewals
M-EBITDA and Margins
M-EBITDA grew to $114.2 million for the quarter, an increase of 9%, or $9.8 million from the same period last year. The growth in M-EBITDA represents the contribution from revenue growth, cost efficiencies from network and other optimization efforts and lower bad debt expense, partially offset by an increase in employee and field related costs.
Operating costs for the quarter increased year over year, primarily due to increased network access costs associated with higher revenue and increased field related costs, taxes and fees, partially offset by network and other cost efficiencies. Operating costs as a percent of revenue were 41% for the current period compared to 42% for the same period last year.
Selling, general and administrative costs (“SG&A”) decreased year over year, primarily reflecting a decrease in bad debt expense partially offset by higher employee costs. Bad debt expense was $0.1 million for the quarter and $3.5 million for the same period last year. SG&A costs as a percent of revenue were 24% for the current quarter and 25% for the same period last year.
Modified gross margin(5) was 58.8% for the current quarter compared to 58.7% for the same period last year, a 10 basis point improvement. M-EBITDA margin for the quarter was 36.7% as compared to 35.1% for the same period last year, a 160 basis point improvement.
The Company utilizes a fully burdened modified gross margin, including network costs, and personnel costs for customer care, provisioning, network maintenance, technical field and network operations, excluding non-cash stock-based compensation expense.
Net Loss
For the quarter, net loss was $4.5 million, or $0.03 loss per share compared to net income of $2.9 million, or $0.02 earnings per share, for the same period last year, reflecting the impact of $17.1 million of debt extinguishment costs from a refinancing, partially offset by strong M-EBITDA growth. Excluding debt extinguishment costs, earnings per share was $0.08 per share for the quarter, representing a $0.06 per share improvement year over year.
Sequential Results – First Quarter 2010 compared to Fourth Quarter 2009
Revenue
Revenue for the quarter was $311.2 million, as compared to $307.9 million for the fourth quarter of 2009, an increase of $3.3 million, or 1%. Key changes in revenue included:
- $3.8 million increase in enterprise revenue, representing 2% sequential growth
- $0.8 million increase in revenue from carrier customers reflecting growth in new sales partially offset by churn and repricing for contract renewals
- $1.3 million decrease in intercarrier compensation primarily for fluctuations in disputes
By product line, the percentage change in revenue sequentially was as follows:
- 3% increase for data and Internet services, primarily due to continued success with Ethernet and IP-based product sales partially offset by churn
- 1% increase in voice services, primarily reflecting local products sales and an increase in usage, certain taxes and fees, partially offset by churn
- 1% decrease in network services, primarily due to sales that were outpaced by ongoing churn and repricing for customer contract renewals
M-EBITDA and Margins
M-EBITDA was $114.2 million for the quarter, compared to $113.9 million for the prior quarter. The growth in M-EBITDA represents contribution from revenue growth, cost efficiencies from network and other optimization efforts partially offset by higher employee related costs. The Company experienced seasonally higher employee costs related to the resetting of payroll taxes.
Operating costs decreased primarily reflecting increased access costs associated with the growth in revenue, offset by ongoing network and other cost efficiencies and lower employee costs. Operating costs were 41% of revenue for the current quarter and 42% for the prior quarter.
SG&A costs increased primarily reflecting higher employee costs including the impact of resetting of payroll taxes and higher benefit and other costs. Bad debt expense remained nearly flat compared to the prior quarter. SG&A was 24% of revenue for the current period as compared to 23% for the prior quarter.
Modified gross margin was 58.8% compared to 58.2% for the prior quarter, a 60 basis point improvement. M-EBITDA margin was 36.7% for the quarter, compared to 37.0% for the prior quarter, a 30 basis point reduction.
Net Loss
For the quarter, the Company reported net loss of $4.5 million, or $0.03 loss per share compared to net income of $11.1 million, or $0.07 earnings per share for the prior quarter, reflecting the impact of $17.1 million of debt extinguishment costs associated with a refinancing, somewhat offset by lower depreciation and M-EBITDA growth. Excluding debt extinguishment costs, earnings per share was $0.08 per share for the quarter, representing a $0.01 per share improvement sequentially.
Summary
“We believe our business is in a great position, generating strong cash flow with a differentiated asset base and comprehensive and competitive product portfolio, and we are executing well operationally, all of which will help drive long-term growth and shareholder value,” said Herda.
tw telecom plans to conduct a webcast conference call to discuss its earnings results on May 11, 2010 at 9:00 a.m. MDT (11:00 a.m. EDT). To access the webcast and the financial and other information to be discussed in the webcast, visit www.twtelecom.com under “Investor Relations.”
(1) The Company uses a modified definition of EBITDA to eliminate certain non-cash and non-operating income or charges to earnings to enhance the comparability of its financial performance from period to period. Modified EBITDA (or “M-EBITDA”) is defined as net income or loss before depreciation, amortization, accretion, impairment charges and other gains and losses, interest expense, debt extinguishment costs, interest income, income tax expense or benefit, cumulative effect of change in accounting principle, and non-cash stock-based compensation expense.
(2) The Company defines unlevered free cash flow as Modified EBITDA less capital expenditures. Unlevered free cash flow is reconciled to Net Cash provided by (used in) operating activities in the supplemental information posted on the Company’s website.
(3) The Company defines levered free cash flow as Modified EBITDA less capital expenditures and net interest expense from operations (but excludes debt extinguishment costs and non cash interest expense and deferred debt costs). Levered free cash flow is reconciled to Net Cash provided by (used in) operating activities in the supplemental information posted on the Company’s website.
(4) The Company defines revenue churn as the lost recurring monthly billing for the quarter from a customer’s partial or complete disconnection of services (excluding repricing impacts and usage) compared to reported revenue for the quarter. Customer churn is defined as the average monthly customer turnover for the quarter compared to the average monthly customer count for the quarter.
(5) The Company defines modified gross margin as total revenue less operating costs excluding non-cash stock-based compensation expense. Modified gross margin is reconciled to gross margin in the financial tables.
(6) Fiber connected buildings on-net represent locations to which the Company’s fiber is directly connected with lit electronics. This does not include buildings which are exclusively Local Serving Office locations or buildings with fiber but no lit electronics.
(7) Bookings reflect signed customer sales. The timing of when these sales are installed and recognized as revenue varies based on the underlying contract.
Financial Measures
The Company provides financial measures using U.S. generally accepted accounting principles (“GAAP”) as well as adjustments to GAAP measures to describe its business trends, including Modified EBITDA. Management believes that its definition of Modified EBITDA (see above) is a standard measure of operating performance and liquidity that is commonly reported and widely used by analysts, investors, and other interested parties in the telecommunications industry because it eliminates many differences in financial, capitalization, and tax structures, as well as non-cash and non-operating income or charges to earnings. Modified EBITDA is not intended to replace operating income (loss), net income (loss), cash flow, and other measures of financial performance and liquidity reported in accordance with GAAP. Management uses Modified EBITDA internally to assess on-going operations and it is the basis for various financial covenants contained in the Company’s debt agreements and for operating performance and liquidity. Modified EBITDA is reconciled to Net Income (Loss), the most comparable GAAP measure for operating performance within the Consolidated Operations Highlights and in the supplemental information posted on the Company’s website. Modified EBITDA, as a measure of liquidity, is also reconciled to Net Cash provided by operating activities on the Company’s website.
In addition, management uses unlevered and levered free cash flow, which measure the ability of M-EBITDA to cover capital expenditures. The Company uses these cash flow definitions to eliminate certain non-cash costs. Levered and unlevered free cash flow are reconciled to Net Cash provided by (used in) operating activities and also to Modified EBITDA in the supplemental information posted on the Company’s website. The Company also provides an adjustment to the measure gross margin by eliminating the impact of non-cash stock-based compensation expense. Management uses modified gross margin internally to assess on-going operations. Modified gross margin is reconciled to gross margin in the Consolidated Operations Highlights.
Forward Looking Statements
The statements in this press release and related conference call concerning the outlook for 2010 and beyond, including product plans, growth prospects, market opportunities, bookings, future economic conditions, sales and installations timing, revenue growth, churn, business trends and fluctuations, seasonality, expense trends, and expected capital expenditures are forward-looking statements that reflect management’s views with respect to future events and financial performance. These statements are based on management’s current expectations and are subject to risks and uncertainties. Important factors that could cause actual results to differ materially from those in the forward looking statements include the risks disclosed in the Company’s SEC filings, especially the section entitled “Risk Factors” in its 2009 Annual Report on Form 10-K and in its quarterly report on Form 10-Q for the quarter ended March 31, 2010. tw telecom undertakes no obligations to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About tw telecom
tw telecom, headquartered in Littleton, Colo., provides managed network services, specializing in Ethernet and data networking, Internet access, local and long distance voice, VPN, VoIP and network security, to enterprise organizations and communications services companies throughout the U.S. including their global locations. As a leading provider of integrated and converged network solutions, tw telecom delivers customers overall economic value, quality service, and improved business productivity. For more information please visit www.twtelecom.com.
| tw telecom inc. | ||||||||
| Consolidated Operations Highlights | ||||||||
| (Dollars in thousands) | ||||||||
| Unaudited (1) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2010 | 2009 | Growth % | ||||||
| Revenue | ||||||||
| Data and Internet services | $129,121 | $112,042 | 15% | |||||
| Network services | 89,548 | 93,866 | -5% | |||||
| Voice services | 84,072 | 83,077 | 1% | |||||
| Service Revenue | 302,741 | 288,985 | 5% | |||||
| Intercarrier compensation | 8,470 | 8,646 | -2% | |||||
| Total Revenue | 311,211 | 297,631 | 5% | |||||
| Expenses | ||||||||
| Operating costs | 128,855 | 123,731 | ||||||
| Gross Margin | 182,356 | 173,900 | ||||||
| Selling, general and administrative costs | 75,102 | 75,820 | ||||||
| Depreciation, amortization, and accretion | 73,387 | 73,191 | ||||||
| Operating Income | 33,867 | 24,889 | ||||||
| Interest expense | (15,906) | (16,681) | ||||||
| Debt Extinguishment Costs | (17,070) | – | ||||||
| Non cash interest expense and deferred debt costs | (5,035) | (4,777) | ||||||
| Interest income | 57 | 130 | ||||||
| Income (Loss) before income taxes | (4,087) | 3,561 | ||||||
| Income tax expense | 375 | 681 | ||||||
| Net Income (Loss) | ($4,462) | $2,880 | ||||||
| SUPPLEMENTAL INFORMATION TO RECONCILE MODIFIED GROSS MARGIN AND MODIFIED EBITDA | ||||||||
| Gross Margin | $182,356 | $173,900 | ||||||
| Add back non-cash stock-based compensation expense | 758 | 725 | ||||||
| Modified Gross Margin | 183,114 | 174,625 | 5% | |||||
| Selling, general and administrative costs | 75,102 | 75,820 | ||||||
| Add back non-cash stock-based compensation expense | 6,219 | 5,637 | ||||||
| Modified EBITDA | 114,231 | 104,442 | 9% | |||||
| Non-cash stock-based compensation expense | 6,977 | 6,362 | ||||||
| Depreciation, amortization, and accretion | 73,387 | 73,191 | ||||||
| Net Interest expense | 15,849 | 16,551 | ||||||
| Debt Extinguishment costs | 17,070 | – | ||||||
| Non cash interest expense and deferred debt costs | 5,035 | 4,777 | ||||||
| Income tax expense | 375 | 681 | ||||||
| Net Income (Loss) | ($4,462) | $2,880 | ||||||
| Modified Gross Margin % | 58.8% | 58.7% | ||||||
| Modified EBITDA Margin % | 36.7% | 35.1% | ||||||
| Free Cash Flow: | ||||||||
| Modified EBITDA | $114,231 | $104,442 | 9% | |||||
| Less: Capital Expenditures | 80,929 | 73,425 | 10% | |||||
| Unlevered Free Cash Flow | 33,302 | 31,017 | 7% | |||||
| Less: Net interest expense | 15,849 | 16,551 | -4% | |||||
| Levered Free Cash Flow | $17,453 | $14,466 | 21% | |||||
| (1) For complete financials and related footnotes, please refer to the Company’s SEC filings. | ||||||||
| tw telecom inc. | ||||||||
| Consolidated Operations Highlights | ||||||||
| (Dollars in thousands) | ||||||||
| Unaudited (1) | ||||||||
| Three Months Ended | ||||||||
| Mar 31, | Dec 31, | |||||||
| 2010 | 2009 | Growth % | ||||||
| Revenue | ||||||||
| Data and Internet services | $129,121 | $124,799 | 3% | |||||
| Network services | 89,548 | 90,463 | -1% | |||||
| Voice services | 84,072 | 82,860 | 1% | |||||
| Service Revenue | 302,741 | 298,122 | 2% | |||||
| Intercarrier compensation | 8,470 | 9,812 | -14% | |||||
| Total Revenue | 311,211 | 307,934 | 1% | |||||
| Expenses | ||||||||
| Operating costs | 128,855 | 129,855 | ||||||
| Gross Margin | 182,356 | 178,079 | ||||||
| Selling, general and administrative costs | 75,102 | 71,355 | ||||||
| Depreciation, amortization, and accretion | 73,387 | 74,290 | ||||||
| Operating Income | 33,867 | 32,434 | ||||||
| Interest expense | (15,906) | (15,815) | ||||||
| Debt Extinguishment Costs | (17,070) | – | ||||||
| Non cash interest expense and deferred debt costs | (5,035) | (4,969) | ||||||
| Interest income | 57 | 33 | ||||||
| Income (Loss) before income taxes | (4,087) | 11,683 | ||||||
| Income tax expense | 375 | 587 | ||||||
| Net Income (Loss) | ($4,462) | $11,096 | ||||||
| SUPPLEMENTAL INFORMATION TO RECONCILE MODIFIED GROSS MARGIN AND MODIFIED EBITDA | ||||||||
| Gross Margin | $182,356 | $178,079 | ||||||
| Add back non-cash stock-based compensation expense | 758 | 1,190 | ||||||
| Modified Gross Margin | 183,114 | 179,269 | 2% | |||||
| Selling, general and administrative costs | 75,102 | 71,355 | ||||||
| Add back non-cash stock-based compensation expense | 6,219 | 5,953 | ||||||
| Modified EBITDA | 114,231 | 113,867 | 0% | |||||
| Non-cash stock-based compensation expense | 6,977 | 7,143 | ||||||
| Depreciation, amortization, and accretion | 73,387 | 74,290 | ||||||
| Net Interest expense | 15,849 | 15,782 | ||||||
| Debt extinguishment costs | 17,070 | – | ||||||
| Non cash interest expense and deferred debt costs | 5,035 | 4,969 | ||||||
| Income tax expense | 375 | 587 | ||||||
| Net Income (Loss) | ($4,462) | $11,096 | ||||||
| Modified Gross Margin % | 58.8% | 58.2% | ||||||
| Modified EBITDA Margin % | 36.7% | 37.0% | ||||||
| Free Cash Flow | ||||||||
| Modified EBITDA | $114,231 | $113,867 | 0% | |||||
| Less: Capital Expenditures | 80,929 | 72,347 | 12% | |||||
| Unlevered Free Cash Flow | 33,302 | 41,520 | -20% | |||||
| Less: Net interest expense | 15,849 | 15,782 | 0% | |||||
| Levered Free Cash Flow | $17,453 | $25,738 | -32% | |||||
| (1) For complete financials and related footnotes, please refer to the Company’s SEC filings. | ||||||||
| tw telecom inc. | |||||||
| Highlights of Results Per Share | |||||||
| Unaudited (1) (2) | |||||||
| Three Months Ended | |||||||
| 3/31/10 | 12/31/09 | 3/31/09 | |||||
| Weighted Average Shares Outstanding (thousands) | |||||||
| Basic | 149,296 | 148,439 | 147,853 | ||||
| Diluted (2) | 149,296 | 151,372 | 148,620 | ||||
| Basic & Diluted Income (Loss) per Common Share | |||||||
| Prior to debt extinguishment costs | $0.08 | $0.07 | $0.02 | ||||
| Debt Extinguishment costs | ($0.11) | $0.00 | $0.00 | ||||
| Total | ($0.03) | $0.07 | $0.02 | ||||
| As Of | |||||||
| 3/31/10 | 12/31/09 | 3/31/09 | |||||
| Common shares (thousands) | |||||||
| Actual Shares Outstanding | 151,666 | 150,123 | 149,069 | ||||
| Unvested Restricted Stock Units and Restricted Stock Awards (thousands) | 3,496 | 2,296 | 2,910 | ||||
| Options (thousands) | |||||||
| Options Outstanding | 11,152 | 11,035 | 13,657 | ||||
| Options Exercisable | 7,518 | 6,922 | 8,571 | ||||
| Options Exercisable and In-the-Money | 3,658 | 2,639 | 1,775 | ||||
| (1) For complete financials and related footnotes, please refer to the Company’s SEC filings. | |||||||
| (2) Stock options, restricted stock units/awards and convertible debt subject to conversion, are excluded from the computation of diluted weighted average shares outstanding if inclusion would be anti-dilutive. See the Company’s SEC filings for more details. | |||||||
| tw telecom inc. | |||||||||
| Condensed Consolidated Balance Sheet Highlights | |||||||||
| (Dollars in thousands) | |||||||||
| Unaudited (1) | |||||||||
| March 31, | December 31, | March 31, | |||||||
| 2010 | 2009 | 2009 | |||||||
| ASSETS | |||||||||
| Cash, equivalents and short term investments | $486,469 | $470,772 | $353,212 | ||||||
| Receivables | 85,394 | 87,465 | 85,833 | ||||||
| Less: allowance | (9,146) | (9,449) | (13,274) | ||||||
| Net receivables | 76,248 | 78,016 | 72,559 | ||||||
| Other current assets | 42,032 | 43,120 | 22,207 | ||||||
| Property, plant and equipment | 3,559,212 | 3,481,287 | 3,330,115 | ||||||
| Less: accumulated depreciation | (2,252,570) | (2,186,915) | (2,021,551) | ||||||
| Net property, plant and equipment | 1,306,642 | 1,294,372 | 1,308,564 | ||||||
| Other Assets | 491,092 | 487,920 | 516,353 | ||||||
| Total | $2,402,483 | $2,374,200 | $2,272,895 | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||
| Current Liabilities | |||||||||
| Accounts payable | $61,506 | $51,088 | $32,967 | ||||||
| Deferred revenue | 34,644 | 34,005 | 31,607 | ||||||
| Accrued taxes, franchise and other fees | 68,010 | 68,669 | 63,538 | ||||||
| Accrued interest | 5,949 | 16,219 | 9,555 | ||||||
| Accrued payroll and benefits | 37,150 | 42,589 | 36,322 | ||||||
| Accrued carrier costs | 31,917 | 35,890 | 31,271 | ||||||
| Current portion of debt and lease obligations | 7,147 | 7,569 | 8,564 | ||||||
| Other current liabilities | 43,815 | 39,120 | 33,428 | ||||||
| Total current liabilities | 290,138 | 295,149 | 247,252 | ||||||
| Long-Term Debt and Capital Lease Obligations | |||||||||
| 2 3/8% convertible senior debentures, due 4/1/2026 | 373,744 | 373,750 | 373,750 | ||||||
| Unamortized Discount | (60,432) | (64,808) | (77,397) | ||||||
| Net | 313,312 | 308,942 | 296,353 | ||||||
| Floating rate senior secured debt – Term Loan B, due 1/7/2013 | 580,500 | 582,000 | 586,500 | ||||||
| 9 1/4% senior unsecured notes, due 2/15/2014 | – | 400,229 | 400,271 | ||||||
| 8% senior unsecured notes, net of discount, due 2018 | 426,937 | – | – | ||||||
| Capital lease obligations | 16,084 | 16,768 | 18,005 | ||||||
| Less: current portion | (7,147) | (7,569) | (8,564) | ||||||
| Total long-term debt and capital lease obligations | 1,329,686 | 1,300,370 | 1,292,565 | ||||||
| Long-Term Deferred Revenue | 16,398 | 15,988 | 17,457 | ||||||
| Other Long-Term Liabilities | 31,067 | 30,653 | 33,120 | ||||||
| Stockholders’ Equity | 735,194 | 732,040 | 682,501 | ||||||
| Total | $2,402,483 | $2,374,200 | $2,272,895 | ||||||
| (1) For complete financials and related footnotes, please refer to the Company’s SEC filings. | |||||||||
| tw telecom inc. | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| (Dollars in thousands) | ||||||||||
| Unaudited (1) | ||||||||||
| Three Months Ended | ||||||||||
| Mar 31, | Dec 31, | Mar 31, | ||||||||
| 2010 | 2009 | 2009 | ||||||||
| Cash flows from operating activities: | ||||||||||
| Net Income (loss) | ($4,462) | $11,096 | $2,880 | |||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||
| Depreciation, amortization, and accretion | 73,387 | 74,290 | 73,191 | |||||||
| Stock-based compensation | 6,977 | 7,143 | 6,362 | |||||||
| Extinguishment costs and amortization of discount on debt and deferred debt costs | 22,146 | 4,992 | 5,198 | |||||||
| Changes in operating assets and liabilities: | ||||||||||
| Receivables, prepaid expense and other assets | 3,116 | (3,813) | 8,681 | |||||||
| Accounts payable, deferred revenue, and other liabilities | (3,903) | 18,567 | (32,486) | |||||||
| Net cash provided by operating activities | 97,261 | 112,275 | 63,826 | |||||||
| Cash flows from investing activities: | ||||||||||
| Capital expenditures | (80,929) | (72,347) | (66,159) | |||||||
| Purchase of investments | (90,025) | (24,892) | – | |||||||
| Proceeds from redemptions of investments | 15,075 | – | – | |||||||
| Proceeds from sale of assets and other investing activities | (2,325) | 386 | 5,149 | |||||||
| Net cash used in investing activities | (158,204) | (96,853) | (61,010) | |||||||
| Cash flows from financing activities: | ||||||||||
| Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units | 167 | 444 | (132) | |||||||
| Net proceeds from issuance of debt | 417,477 | – | – | |||||||
| Retirement of debt obligations | (413,683) | – | – | |||||||
| Payment of debt and capital lease obligations | (2,014) | (2,290) | (1,648) | |||||||
| Net cash provided by (used in) financing activities | 1,947 | (1,846) | (1,780) | |||||||
| Increase (decrease) in cash and cash equivalents | (58,996) | 13,576 | 1,036 | |||||||
| Cash and cash equivalents at the beginning of the period | 445,907 | 432,331 | 352,176 | |||||||
| Cash and cash equivalents at the end of the period | $386,911 | $445,907 | $353,212 | |||||||
| Supplemental disclosures of cash, equivalents and short term investments | ||||||||||
| Cash and cash equivalents at the end of the period | $386,911 | $445,907 | 353,212 | |||||||
| Short term investments | 99,558 | 24,865 | – | |||||||
| Total of cash, equivalents and short term investments | $486,469 | $470,772 | $353,212 | |||||||
| Supplemental disclosures of cash flow information: | ||||||||||
| Cash paid for interest | $26,697 | $9,382 | $25,134 | |||||||
| Cash paid for debt extinguishment costs | $13,677 | – | – | |||||||
| Cash paid for income taxes | $22 | $175 | $28 | |||||||
| Addition of capital lease obligation | – | – | $7,266 | |||||||
| Supplemental information to reconcile capital expenditures: | ||||||||||
| Capital expenditures per cash flow statement | $80,929 | $72,347 | $66,159 | |||||||
| Addition of capital lease obligation | – | – | 7,266 | |||||||
| Total capital expenditures | $80,929 | $72,347 | $73,425 | |||||||
| (1) For complete financials and related footnotes, please refer to the Company’s SEC filings. | ||||||||||
| tw telecom inc. | ||||||||||
| Selected Operating Statistics | ||||||||||
| Unaudited (1) | ||||||||||
| Three Months Ended | ||||||||||
| 2009 | 2010 | |||||||||
| Mar. 31 | Jun. 30 | Sept. 30 | Dec. 31 | Mar. 31 | ||||||
| Operating Metrics: | ||||||||||
| Buildings | ||||||||||
| Fiber connected buildings, on-net | 9,685 | 9,934 | 10,170 | 10,407 | 10,647 | |||||
| Headcount | ||||||||||
| Total Headcount | 2,853 | 2,861 | 2,849 | 2,870 | 2,887 | |||||
| Sales Associates | 486 | 494 | 503 | 522 | 523 | |||||
| Customers | ||||||||||
| Total Customers | 29,256 | 28,676 | 28,347 | 27,989 | 27,685 | |||||
| (1) For complete financials and related footnotes, please refer to the Company’s SEC filings. | ||||||||||
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