10-KPeriod: FY2007

CHARTER COMMUNICATIONS, INC. /MO/ Annual Report, Year Ended Dec 31, 2007

Filed February 27, 2008For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) reported revenues of $6.0 billion for the year ended December 31, 2007. Despite revenue growth, the company continued to experience significant net losses, amounting to $1.6 billion ($4.39 per share) for the year. This persistent unprofitability is primarily attributed to high debt levels leading to substantial interest expenses, coupled with operating costs and depreciation from ongoing capital investments. The company's balance sheet as of December 31, 2007, showed a significant shareholders' deficit of $7.9 billion and a working capital deficit of $996 million, underscoring its precarious financial position. Charter Communications is heavily leveraged, with long-term debt totaling $19.9 billion against investment in cable properties of $14.0 billion. The company's strategic focus remains on improving customer experience, growing sales and retention, enhancing operational efficiency, and opportunistically managing liquidity and debt. Significant financing transactions were undertaken in 2007 to improve liquidity and extend debt maturities.

Key Highlights

  • 1Reported revenues of $6.0 billion for the fiscal year 2007.
  • 2Incurred a net loss of $1.6 billion, or $4.39 per share, for fiscal year 2007.
  • 3Total long-term debt stood at $19.9 billion as of December 31, 2007.
  • 4Shareholders' deficit was $7.9 billion as of December 31, 2007.
  • 5Completed several financing transactions in 2007 to improve liquidity and manage debt maturities.
  • 6The company continues to face intense competition from DBS and DSL providers.
  • 7Paul G. Allen holds a controlling voting interest of 91% as of December 31, 2007.

Frequently Asked Questions

Charter Communications operates broadband communications businesses in the United States, offering video programming, high-speed Internet access, and telephone services to approximately 5.6 million customers as of December 31, 2007. Their services are delivered over a hybrid fiber and coaxial cable network.

Charter Communications is in a challenging financial position. As of December 31, 2007, the company reported a significant shareholders' deficit of $7.9 billion and a working capital deficit of $996 million. The company carries substantial long-term debt of $19.9 billion against total assets of $14.7 billion. Despite revenue growth, it has a history of net losses, with a $1.6 billion net loss reported for 2007, primarily due to high interest expenses on its debt.

Charter's strategic priorities for 2008 include improving the end-to-end customer experience and increasing customer loyalty, growing sales and retention for all products and services, enhancing operational and capital effectiveness and efficiency, and maintaining an opportunistic approach to improving liquidity, extending debt maturities, and reducing debt.

Paul G. Allen, through affiliated entities, controls Charter Communications. As of December 31, 2007, he held a 91% voting control interest in the company and approximately 50% of the common equity on an as-converted basis.