Charter to restate financials
SEC probes sub count
|
NEW YORK -- St. Louis-based cable systems giant Charter Communications on Tuesday said it would restate its financial results for 2000 and 2001 to reflect unreported financial items from a series of acquisitions made over the past several years.
Separately on Tuesday, Charter revealed in a regulatory filing that it had received a "nonpublic, informal" inquiry from the Securities & Exchange Commission concerning the reporting of its subscriber count and procedures for disconnecting customers.
Paul Allen's embattled cabler, which is already under grand jury investigation for its accounting practices, said Tuesday that it had failed to account for franchise costs worth $1.4 billion as well as $1.2 billion in deferred income tax liabilities.
Charter maintained, however, that the new disclosure would not affect its revenues or cash flow -- a financial yardstick often used by media companies to measure performance. A company rep noted that the franchise costs and the deferred taxes effectively cancel each other out for the restated years, leaving roughly $200 million in net expenses unreported.
In its latest quarterly earnings report, Charter said the restatement increased its third-quarter 2001 losses by just under $9 million to $326.6 million. For the first nine months of 2001, losses widened by $25 million to $897 million.
Charter had not yet provided numbers for the full-year 2001 or 2000 restatements as of late Tuesday. The company said it would post those changes shortly, after a reaudit of its books by KPMG.
Meanwhile, Charter said revenues grew by just under 13% to $1.18 billion in third quarter 2002, and net losses were trimmed by almost 28% to $239 million. Company got a boost from strong subscriber growth in new higher-margin services like digital cable and high-speed Net access.
However, the company has been suffering of late from a decline in basic cable subscribers, as well as a crushing debt load from profligate spending over the last few years to upgrade and expand its network.
Charter's stock price rose just under 1% to close at $1.19 Tuesday. Shares have tumbled by more than 90% from highs of more than $17 reached earlier this year.
