With CharterCommunications Inc. nearing final approval of its of and ,Charter CEO Tom Rutledge said making the merged company's extended footprintfully digital would be a "key priority" going forward.
FCC Chairman Tom Wheeler and the U.S. Department of Justiceboth recently recommended conditional approval of the mega-transactions, which would createthe second-largest broadband provider in the country behind Speaking during an April28 earnings conference call, Rutledge said Charter expects to close thetransactions a few days after receiving final from the California PublicUtilities Commission and the FCC. The full federal commission still must voteon Chairman Wheeler's proposed conditions for the deal; the California PUC isexpected make its decision by May 12.
After the transactions close, the newly merged Charterintends to complete ongoing all-digital projects and launch new pricing andpackaging across its entire footprint by the end of 2018, Rutledge said, addingthat Charter's new cloud-based interface should be available in most of itslegacy markets by the end of this year.
Charter on April 28 reported first-quarter revenues of $2.53billion, up 7.1% year over year from $2.36 billion, fueled by gains inInternet, video and commercial revenues. Video revenue rose 3.7% year over yearto $1.17 billion from $1.13 billion, driven by higher advanced servicespenetration, annual and promotional rate adjustments and an increase inexpanded basic and digital customers and revenue allocation from higherbundling, which was partially offset by a decrease in residential limited basicvideo customers, the company said.
Internet revenue was up 12.1% year over year to $804 millionfrom $717 million, reflecting an increase of 458,000 Internet customersthroughout 2015.
Voice revenues totaled $135 million versus $134 million inthe first quarter of 2015, due to the addition of 152,000 voice customers inthe last 12 months, partially offset by value-based pricing.
Commercial revenues rose to $301 million, an increase of 12%over the prior-year period, driven by double-digit revenue growth in Charter'ssmall and medium business and enterprise segments.
In the first quarter, Charter saw net additions of 10,000residential video customers, 141,000 residential Internet customers and 35,000residential voice customers. Charter had 6.8 millionresidential and small and medium business customers at the end of the firstquarter.
The launch of new small business pricing and packaging inthe March 2015 quarter helped drive customer growth, Rutledge said during thecall.
Charter posted a net loss of $188 million, or $1.68 pershare, for the first quarter, compared to a year-ago net loss of $81 million,or 73 cents per share. The company attributed the widening loss to $165 millionin interest expense related to financing the Time Warner Cable and Bright Houseacquisitions. CFO Christopher Winfrey also noted that programming expenses grewby $37 million in the first quarter.
The S&P Capital IQ first-quarter consensus estimate wasa loss of $1.36 per share on a normalized basis and a loss of $1.34 per shareon a GAAP basis.