ALTICE USA REPORTS FOURTH QUARTER AND FULL YEAR 2020 RESULTS
NEW YORK (February 10, 2021) - Altice USA (NYSE: ATUS) today reports results for the fourth quarter and full year ended December 31, 2020.
Dexter Goei, Altice USA Chief Executive Officer, said: “I could not be more proud of the Altice USA team for its perseverance and dedication during such an unparalleled year. Our team's unrelenting focus on serving both our customers and broader community has allowed us to achieve spectacular results in a number of areas, including record broadband customer gains, solid revenue growth, best-ever Adjusted EBITDA margins and highest-ever annual Free Cash Flow. We also returned $4.8 billion to shareholders for the full year through share repurchases. I am pleased to cap off a tremendous 2020 with yet another strong quarter, which makes us well-positioned for 2021."
Key Financial Highlights
•Total Revenue grew 2.5% YoY in Q4 2020 to $2.54 billion (or up +3.2% YoY adjusted for anticipated RSN credits(1), and up +3.6% YoY further adjusted for storm credits(2)), driven by Broadband revenue growth of +14.0% YoY and News & Advertising growth of +29.7%. Total revenue grew +1.4% YoY in full-year (FY) 2020 to $9.89 billion (or up +2.4% YoY adjusted for anticipated RSN credits(1), and up +2.6% YoY further adjusted for storm credits(2)).
•Net income attributable to stockholders was $330.5m in Q4 2020, or $0.60/share on a diluted basis, compared to a net income of $0.3 million, or $0.00/share, in Q4 2019. Net income attributable to stockholders was $436.2m in FY 2020, or $0.75/share, compared to a net income of $138.9 million, or $0.21/share on a diluted basis in FY 2019.
•Net cash flows from operating activities was $791.5m in Q4 2020, compared to $720.2m in Q4 2019. FY 2020 net cash flows from operating activities was $2.98 billion, compared to $2.55 billion in FY-19.
•Adjusted EBITDA(3) increased +6.1% YoY in Q4 2020 to $1.15 billion with a margin of 45.4% (growth of +5.8% YoY and a margin of 46.5% ex-mobile, or growth of +6.6% YoY and a margin of 46.3% excluding mobile, RSN credits, and storms(4)). Adjusted EBITDA increased +3.5% YoY in FY 2020 to $4.41 billion with a margin of 44.6% (growth of +4.2% YoY and a margin of 45.7% ex-mobile, or growth of +4.8% YoY and 45.4% margin excluding mobile, RSN credits and storms).
•Cash capex of $344.6 million in Q4 2020 represented 13.6% of revenue, and was up 6.7% YoY due to the timing of capex spend in 2020 and storm reconstruction outlays in Q4 2020. Cash capex of $1.07 billion in FY 2020 represented 10.9% of revenue and was down -20.8% YoY partly due to delayed permitting in the Company’s FTTH rollout.
•Operating Free Cash Flow(3) for Q4 2020 increased +5.8% YoY to $806.4 million. Operating Free Cash Flow for FY 2020 increased +14.8% YoY to $3.34 billion, reflecting Adjusted EBITDA growth and lower capital spending on a YoY basis.
•Free Cash Flow(3) increased 12.5% YoY in Q4 2020 to $446.9 million. FY 2020 free cash flow increased +59.0% YoY to $1.91 billion, representing the highest-ever annual Free Cash Flow.
•Share repurchases were approximately $3.0 billion in Q4 2020 and $4.8 billion in FY 2020.
•FY 2021 Financial Outlook: The Company expects revenue and Adjusted EBITDA growth for 2021, cash capex to be between $1.3 to $1.4 billion for the year, and share repurchases of $1.5 billion. The Company expects leverage at year-end 2021 to be less than 5.3x (L2QA net debt to Adjusted EBITDA) for its CSC Holdings, LLC debt silo, with a target of 4.5x-5.0x L2QA EBITDA over time.
(1)Adjusted revenue excludes $18.5m ($17.6m in Residential Video and $0.9m in Business Services) in Q4 2020 and $97.2m ($94.3m in Residential Video and $2.9m in Business Services) in FY 2020 of service credits and associated franchise fees that the Company expects to return to customers as a result of regional sports networks ("RSN") affiliate fee credits the Company expects to receive for a minimum number of events not delivered in 2020.
(2)Storm credits totaled $10.4m in Q4 2020 ($8.7m in Residential and $1.6m in Business Services) and $26.5m in FY 2020 ($22.8m in Residential and $3.7m in Business Services). The net impact of the storms on Adjusted EBITDA was $8.5m in Q4 2020 and $24.4m in FY 2020.
(3)See “Reconciliation of Non-GAAP Measures” on page 6 of this release. Operating Free Cash Flow defined as Adjusted EBITDA less cash capital expenditures, and Free Cash Flow defined as net cash flows from operating activities less cash capital expenditures.
(4)Q4 2020 Adjusted EBITDA growth of +5.8% and margin of 46.5% in Q4 2020 exclude approximately $18.9m of losses related to Altice USA’s mobile business in the current period and $20.4m of losses in Q4 2019. Q4 2020 Adjusted EBITDA growth of +6.6% and margin of 46.3% exclude the mobile losses, storm impact of $8.5m and RSN fee credits to revenue of $18.5m. FY 2020 Adjusted EBITDA growth of +4.2% and margin of 45.7% exclude approximately $73.0m of losses related to Altice USA’s mobile business in the current period and $39.4m of losses in FY 2019. FY 2020 Adjusted EBITDA growth of +4.8% and margin of 45.4% exclude mobile losses, storm impact of $24.4m, and RSN fee credits to revenue of $97.2m.
The following information was filed by Altice Usa, Inc. (ATUS) on Wednesday, February 10, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.