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Comcast Reports 3rd Quarter 2014 Results

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Comcast Corporation (NASDAQ: CMCSA, CMCSK) today reported results for the quarter ended September 30, 2014.

Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation, said, “I am pleased to report strong revenue, operating cash flow and free cash flow growth for the third quarter of 2014. Cable results highlight the consistent strength of high-speed Internet and business services, and video customer results were the best for a third quarter in seven years. We continue to focus on innovation and providing the best experience for our customers, and we are thrilled with the response to our superior X1 platform, which recently reached five million boxes deployed. At NBCUniversal, we had another outstanding quarter with double-digit operating cash flow growth, driven by ratings momentum at NBC Broadcast and the successful opening of The Wizarding World of Harry Potter TM- Diagon Alley TM in Orlando.”

Consolidated Financial Results

3rd Quarter Year to Date
($ in millions) 2013 2014 Growth 2013 2014 Growth
Revenue $ 16,151 $ 16,791 4.0 % $ 47,731 $ 51,043 6.9 %
Excluding Olympics $ 47,731 $ 49,940 4.6 %
Operating Cash Flow1 $ 5,330 $ 5,704 7.0 % $ 15,789 $ 17,046 8.0 %
Excluding Transaction-Related Costs & Pension Costs $ 5,404 $ 5,781 7.0 % $ 15,863 $ 17,184 8.3 %
Operating Income $ 3,414 $ 3,745 9.7 % $ 9,916 $ 11,117 12.1 %
Earnings per Share2 $ 0.65 $ 0.99 52.3 % $ 1.84 $ 2.46 33.7 %
Excluding Adjustments (see Table 4) $ 0.65 $ 0.73 12.3 % $ 1.81 $ 2.17 19.9 %
Free Cash Flow3 $ 1,968 $ 2,494 26.7 % $ 7,054 $ 6,473 (8.2 %)

For additional detail on segment revenue and expenses, customer metrics, capital expenditures, and free cash flow, please refer to the trending schedules on Comcast’s Investor Relations website at www.cmcsa.com or www.cmcsk.com.

Consolidated Revenue for the third quarter of 2014 increased 4.0% to $16.8 billion. Consolidated Operating Cash Flow increased 7.0% to $5.7 billion. The Time Warner Cable and Charter transaction-related costs of $77 million in the third quarter of 2014 were a similar amount to the $74 million of costs associated with the termination of a pension plan in the third quarter of 2013 (See Table 5). Consolidated Operating Income increased 9.7% to $3.7 billion.

For the nine months ended September 30, 2014, consolidated revenue increased 6.9% to $51.0 billion. Excluding $1.1 billion of revenue generated by the Sochi Olympics in the first quarter of 2014, consolidated revenue increased 4.6%. Consolidated operating cash flow increased 8.0% to $17.0 billion. Excluding $138 million of transaction-related costs in the first nine months of 2014 and pension termination costs in the third quarter of 2013, consolidated operating cash flow increased 8.3% (See Table 5). Consolidated operating income increased 12.1% to $11.1 billion.

Earnings per Share (EPS) for the third quarter of 2014 was $0.99, a 52.3% increase from the $0.65 reported in the third quarter of 2013. Excluding income tax adjustments and transaction-related costs in the third quarter of 2014, EPS increased 12.3% to $0.73 (see Table 4).

EPS for the nine months ended September 30, 2014 was $2.46, a 33.7% increase from the $1.84 reported in the prior year. Excluding income tax adjustments, gains on the sales of investments, a resolution of a prior acquisition contingency and transaction-related costs in the first nine months of 2014, as well as a gain on the sale of wireless spectrum licenses in the first quarter of 2013, EPS increased 19.9% to $2.17 (see Table 4).

Capital Expenditures increased 13.0% to $2.0 billion in the third quarter of 2014 compared to the third quarter of 2013. Cable Communications’ capital expenditures increased $212 million, or 14.8%, to $1.6 billion in the third quarter of 2014, primarily reflecting increased investment in support capital as we launch our cloud based initiatives and spending on customer premise equipment related to the deployment of the X1 platform, as well as our ongoing investment in network infrastructure to increase network capacity. Cable capital expenditures represented 14.9% of Cable revenue in the third quarter of 2014 compared to 13.6% in last year’s third quarter. NBCUniversal’s capital expenditures increased $11 million, or 4.0%, to $295 million in the third quarter of 2014, primarily reflecting increased investments in Theme Parks.

For the nine months ended September 30, 2014, capital expenditures increased 13.1% to $5.2 billion compared to the prior year. Cable Communications’ capital expenditures increased $516 million, or 13.7%, to $4.3 billion and represented 13.0% of Cable revenue compared to 12.1% in 2013. NBCUniversal’s capital expenditures increased $77 million, or 9.5%, to $884 million for the first nine months of 2014.

Free Cash Flow increased 26.7% to $2.5 billion in the third quarter of 2014 compared to $2.0 billion in the third quarter of 2013, reflecting growth in consolidated operating cash flow, improvements in working capital and lower cash taxes on operating items, partially offset by higher capital expenditures. Free cash flow for the nine months ended September 30, 2014 decreased 8.2% to $6.5 billion compared to $7.1 billion in 2013.

3rd Quarter Year to Date
($ in millions) 2013 2014 Growth 2013 2014 Growth
Operating Cash Flow $ 5,330 $ 5,704 7.0 % $ 15,789 $ 17,046 8.0 %
Capital Expenditures (1,726 ) (1,950 ) 13.0 % (4,593 ) (5,196 ) 13.1 %
Cash Paid for Capitalized Software and Other Intangible Assets (250 ) (258 ) 3.2 % (694 ) (735 ) 5.9 %
Cash Interest Expense (636 ) (656 ) 3.1 % (1,768 ) (1,820 ) 2.9 %
Cash Taxes on Operating Items (1,044 ) (858 ) (17.8 %) (2,585 ) (2,696 ) 4.3 %
Changes in Operating Assets and Liabilities 165 412 149.7 % 583 (493 ) NM
Noncash Share-Based Compensation 99 120 21.2 % 312 386 23.7 %
Distributions to Noncontrolling Interests and Dividends for

Redeemable Subsidiary Preferred Stock

(48 ) (53 ) 10.4 % (164 ) (170 ) 3.7 %
Other 78 33 (57.7 %) 174 151 (13.2 %)
Free Cash Flow3 $ 1,968 $ 2,494 26.7 % $ 7,054 $ 6,473 (8.2 %)
NM=comparison not meaningful.

Dividends and Share Repurchases. During the third quarter of 2014, Comcast paid dividends totaling $582 million and repurchased 13.9 million of its common shares for $750 million. In the first nine months of 2014, Comcast has repurchased 43.8 million of its common shares for $2.3 billion. As of September 30, 2014, Comcast had approximately $5.25 billion available under its share repurchase authorization.

Cable Communications

3rd Quarter Year to Date
($ in millions) 2013 2014 Growth 2013 2014 Growth

Cable Communications Revenue

Video $ 5,127 $ 5,179 1.0 % $ 15,415 $ 15,596 1.2 %
High-Speed Internet 2,592 2,840 9.6 % 7,684 8,409 9.4 %
Voice 919 913 (0.5 %) 2,729 2,755 1.0 %
Business Services 836 1,011 21.0 % 2,365 2,893 22.3 %
Advertising 541 607 12.3 % 1,587 1,725 8.7 %
Other 476 491 2.4 % 1,395 1,449 3.7 %
Cable Communications Revenue $ 10,491 $ 11,041 5.2 % $ 31,175 $ 32,827 5.3 %
Cable Communications Operating Cash Flow $ 4,246 $ 4,464 5.1 % $ 12,800 $ 13,428 4.9 %

Operating Cash Flow Margin

40.5%

40.4%

41.1%

40.9%

Cable Communications Capital Expenditures $ 1,432 $ 1,644 14.8 % $ 3,766 $ 4,282 13.7 %
Percent of Cable Communications Revenue

13.6%

14.9%

12.1%

13.0%

Revenue for Cable Communications increased 5.2% to $11.0 billion in the third quarter of 2014 compared to $10.5 billion in the third quarter of 2013, driven by increases of 9.6% in high-speed Internet and 21.0% in business services. The increase in Cable revenue reflects rate adjustments, customers receiving higher levels of services and customer growth (see below).

For the nine months ended September 30, 2014, Cable revenue increased 5.3% to $32.8 billion compared to $31.2 billion in 2013.

Customer relationships increased by 82,000 to 26.9 million during the third quarter of 2014, more than three-times the customer relationship net additions in the third quarter of 2013. At the end of the third quarter, penetration of our triple product customers increased to 36% compared to 34% in the third quarter of 2013. High-speed Internet customer net additions improved versus last year and were the strongest for a third quarter in five years. Video customer net losses improved 36% year-over-year and were the best result for a third quarter in seven years. Voice net additions slowed, reflecting a focus on double play during the back-to-school season, as well as X1 availability that was more focused on triple play customers last year, making for a difficult comparison.

Customers Net Adds
Billable Customers Method4 (in thousands) 3Q13 3Q14 3Q13 3Q14
Video Customers 22,531 22,376 (127 ) (81 )
High-Speed Internet Customers 20,283 21,586 297 315
Voice Customers 10,496 11,070 169 68
Single Product Customers 8,921 8,444 (124 ) (66 )
Double Product Customers 8,491 8,650 (14 ) 76
Triple Product Customers 9,144 9,763 164 72

Customer Relationships

26,555 26,857 26 82

Operating Cash Flow for Cable Communications increased 5.1% to $4.5 billion in the third quarter of 2014 compared to $4.2 billion in the third quarter of 2013, reflecting higher revenue, partially offset by a 5.3% increase in operating expenses primarily related to higher video programming costs, as well as an increase in advertising, marketing and promotion expenses. This quarter’s operating cash flow margin was 40.4% compared to 40.5% in 2013.

For the nine months ended September 30, 2014, Cable operating cash flow increased 4.9% to $13.4 billion compared to $12.8 billion in 2013. Year-to-date operating cash flow margin was 40.9% compared to 41.1% in 2013.

NBCUniversal

3rd Quarter Year to Date
($ in millions) 2013 2014 Growth 2013 2014 Growth

Excluding
Olympics

NBCUniversal Revenue
Cable Networks $ 2,239 $ 2,255 0.7 % $ 6,877 $ 7,236 5.2 % 1.5 %
Broadcast Television 1,644 1,770 7.7 % 4,893 6,207 26.9 % 9.6 %
Filmed Entertainment 1,400 1,186 (15.2 %) 4,004 3,713 (7.3 %)
Theme Parks 661 786 18.7 % 1,669 1,888 13.1 %
Headquarters, Other and Eliminations (93 ) (76 ) NM (257 ) (231 ) NM
NBCUniversal Revenue $ 5,851 $ 5,921 1.2 % $ 17,186 $ 18,813 9.5 % 3.0 %
NBCUniversal Operating Cash Flow
Cable Networks $ 853 $ 868 1.8 % $ 2,572 $ 2,677 4.1 %
Broadcast Television 34 142 NM 205 504 145.6 %
Filmed Entertainment 189 151 (20.3 %) 291 634 117.7 %
Theme Parks 343 402 16.9 % 747 816 9.1 %
Headquarters, Other and Eliminations (169 ) (147 ) NM (421 ) (470 ) NM
NBCUniversal Operating Cash Flow $ 1,250 $ 1,416 13.3 % $ 3,394 $ 4,161 22.6 %

Revenue for NBCUniversal increased 1.2% to $5.9 billion in the third quarter of 2014 compared to the third quarter of 2013, as revenue growth in Broadcast Television and Theme Parks was partially offset by lower theatrical revenue in the Filmed Entertainment segment. Operating Cash Flow increased 13.3% to $1.4 billion compared to $1.3 billion in the third quarter of 2013, driven by strong results at Broadcast Television and Theme Parks.

For the nine months ended September 30, 2014, NBCUniversal revenue increased 9.5% to $18.8 billion compared to $17.2 billion in 2013. Excluding $1.1 billion of revenue generated by the Sochi Olympics in the first quarter of 2014, NBCUniversal revenue increased 3.0% (see Table 5). Operating cash flow increased 22.6% to $4.2 billion compared to $3.4 billion in the first nine months of 2013.

Cable Networks

For the third quarter of 2014, revenue from the Cable Networks segment increased 0.7% to $2.3 billion compared to $2.2 billion in the third quarter of 2013, reflecting a 5.1% increase in distribution revenue, partially offset by a 4.6% decline in advertising revenue, primarily due to a decline in ratings. Operating cash flow increased 1.8% to $868 million compared to $853 million in the third quarter of 2013, reflecting higher revenue and flat operating costs, even as we continue to invest in programming.

For the nine months ended September 30, 2014, revenue from the Cable Networks segment increased 5.2% to $7.2 billion compared to $6.9 billion in 2013. Excluding $257 million of revenue generated by the Sochi Olympics in the first quarter of 2014, revenue increased 1.5%. Operating cash flow increased 4.1% to $2.7 billion compared to $2.6 billion in the first nine months of 2013.

Broadcast Television

For the third quarter of 2014, revenue from the Broadcast Television segment increased 7.7% to $1.8 billion compared to $1.6 billion in the third quarter of 2013, driven by an increase in advertising revenue due to strong ratings at the NBC broadcast network, as well as higher retransmission consent fees and an increase in content licensing revenue. Operating cash flow increased $108 million to $142 million compared to $34 million in the third quarter of 2013, reflecting higher revenue and a slight increase in operating costs and expenses.

For the nine months ended September 30, 2014, revenue from the Broadcast Television segment increased 26.9% to $6.2 billion compared to $4.9 billion in 2013. Excluding $846 million of revenue generated by the Sochi Olympics in the first quarter of 2014, revenue increased 9.6% (see Table 5). Operating cash flow increased $299 million to $504 million compared to $205 million in the first nine months of 2013.

Filmed Entertainment

For the third quarter of 2014, revenue from the Filmed Entertainment segment decreased 15.2% to $1.2 billion compared to $1.4 billion in the third quarter of 2013, reflecting a decline in theatrical revenue primarily due to the strong box office performance of Despicable Me 2 in the third quarter of 2013. Operating cash flow decreased 20.3% to $151 million compared to $189 million in the third quarter of 2013, reflecting lower revenue, partially offset by a decrease in the amortization of film costs and reduced advertising, marketing and promotion expense due to a smaller film slate.

For the nine months ended September 30, 2014, revenue from the Filmed Entertainment segment decreased 7.3% to $3.7 billion compared to $4.0 billion in 2013. Operating cash flow increased $343 million to $634 million compared to $291 million in the first nine months of 2013.

Theme Parks

For the third quarter of 2014, revenue from the Theme Parks segment increased 18.7% to $786 million compared to $661 million in the third quarter of 2013, reflecting higher guest attendance and per capita spending, driven by the successful opening of Orlando’s The Wizarding World of Harry Potter TM - Diagon Alley TM. Third quarter operating cash flow increased 16.9% to $402 million compared to $343 million in the same period last year, reflecting higher revenue, partially offset by an increase in operating costs to support the new attractions.

For the nine months ended September 30, 2014, revenue from the Theme Parks segment increased 13.1% to $1.9 billion compared to $1.7 billion in 2013. Operating cash flow increased 9.1% to $816 million compared to $747 million in the first nine months of 2013.

Headquarters, Other and Eliminations

NBCUniversal Headquarters, Other and Eliminations include overhead and eliminations among the NBCUniversal businesses. For the quarter ended September 30, 2014, NBCUniversal Headquarters, Other and Eliminations operating cash flow loss was $147 million compared to a loss of $169 million in the third quarter of 2013, reflecting lower employee-related costs.

For the nine months ended September 30, 2014, NBCUniversal Headquarters, Other and Eliminations operating cash flow loss was $470 million compared to a loss of $421 million in 2013.

Corporate, Other and Eliminations

Corporate, Other and Eliminations primarily include corporate operations, Comcast-Spectacor and eliminations among Comcast’s businesses. For the quarter ended September 30, 2014, Corporate, Other and Eliminations revenue was ($171) million compared to ($191) million in 2013. The operating cash flow loss was $176 million, including $77 million of costs related to the Time Warner Cable and Charter transactions, compared to a loss of $166 million in the third quarter of 2013, including $74 million of costs associated with the termination of a pension plan.

For the nine months ended September 30, 2014, Corporate, Other and Eliminations revenue was ($597) million compared to ($630) million in 2013. The operating cash flow loss was $543 million, including $138 million of transaction-related costs, compared to a loss of $405 million in the first nine months of 2013, including $74 million of costs associated with the termination of a pension plan.

Notes:

1 We define Operating Cash Flow as operating income (loss) before depreciation and amortization, excluding impairment charges related to fixed and intangible assets and gains or losses on the sale of assets, if any.
2 Earnings per share amounts are presented on a diluted basis.
3 We define Free Cash Flow as Net Cash Provided by Operating Activities (as stated in our Consolidated Statement of Cash Flows) reduced by capital expenditures, cash paid for intangible assets and cash distributions to noncontrolling interests; and adjusted for any payments and receipts related to certain nonoperating items, net of estimated tax effects. The definition of Free Cash Flow excludes any impact from Economic Stimulus packages. These amounts have been excluded from Free Cash Flow to provide an appropriate comparison.
4

Beginning in 2014, our Cable Communications segment revised its methodology for counting customers related to how we count and report customers who reside in multiple dwelling units (“MDUs”) that are billed under bulk contracts (the “Billable Customers Method”). For MDUs whose residents have the ability to receive additional cable services, such as additional programming choices or our HD or DVR services, we now count and report customers based on the number of potential billable relationships within each MDU. For MDUs whose residents are not able to receive additional cable services, the MDU is now counted as a single customer. Previously, we had counted and reported these customers on an equivalent billing unit basis by dividing monthly revenue received under an MDU’s bulk contract by the standard monthly residential rate where the MDU was located (the “EBU Method”). Video customer metrics for 2013 are now presented on the Billable Customers Method to provide an appropriate comparison. For high-speed Internet and voice customers, the differences in the customer metrics using the Billable Customers Method and the EBU Method were not material and 2013 data has not been adjusted.

All percentages are calculated on whole numbers. Minor differences may exist due to rounding.

Conference Call and Other Information

Comcast Corporation will host a conference call with the financial community today, October 23, 2014 at 8:30 a.m. Eastern Time (ET). The conference call and related materials will be broadcast live and posted on its Investor Relations website at www.cmcsa.com or www.cmcsk.com. Those parties interested in participating via telephone should dial (800) 263-8495 with the conference ID number 3387049. A replay of the call will be available starting at 12:30 p.m. ET on October 23, 2014, on the Investor Relations website or by telephone. To access the telephone replay, which will be available until Thursday, October 30, 2014 at midnight ET, please dial (855) 859-2056 and enter the conference ID number 3387049.

From time to time, we post information that may be of interest to investors on our website at www.cmcsa.com or www.cmcsk.com and on our corporate blog, www.corporate.comcast.com/comcast-voices. To automatically receive Comcast financial news by email, please visit www.cmcsa.com or www.cmcsk.com and subscribe to email alerts.

Caution Concerning Forward-Looking Statements

This press release contains forward-looking statements. Readers are cautioned that such forward-looking statements involve risks and uncertainties that could cause actual events or our actual results to differ materially from those expressed in any such forward-looking statements. Readers are directed to Comcast’s periodic and other reports filed with the Securities and Exchange Commission (SEC) for a description of such risks and uncertainties. We undertake no obligation to update any forward-looking statements.

Non-GAAP Financial Measures

In this discussion, we sometimes refer to financial measures that are not presented according to generally accepted accounting principles in the U.S. (GAAP). Certain of these measures are considered “non-GAAP financial measures” under the SEC regulations; those rules require the supplemental explanations and reconciliations that are in Comcast’s Form 8-K (Quarterly Earnings Release) furnished to the SEC.

About Comcast Corporation

Comcast Corporation (Nasdaq: CMCSA, CMCSK) is a global media and technology company with two primary businesses, Comcast Cable and NBCUniversal. Comcast Cable is the nation’s largest video, high-speed Internet and phone provider to residential customers under the XFINITY brand and also provides these services to businesses. NBCUniversal operates 30 news, entertainment and sports cable networks, the NBC and Telemundo broadcast networks, television production operations, television station groups, Universal Pictures and Universal Parks and Resorts. Visit www.comcastcorporation.com for more information.

TABLE 1
Condensed Consolidated Statement of Income (Unaudited)
Three Months Ended Nine Months Ended
(in millions, except per share data) September 30, September 30,
2013 2014 2013 2014

Revenue

$16,151 $16,791 $47,731 $51,043
Programming and production 4,787 4,772 14,418 15,554
Other operating and administrative 4,751 5,019 13,787 14,695
Advertising, marketing and promotion 1,283 1,296 3,737 3,748
10,821 11,087 31,942 33,997
Operating cash flow 5,330 5,704 15,789 17,046
Depreciation expense 1,520 1,539 4,669 4,707
Amortization expense 396 420 1,204 1,222
1,916 1,959 5,873 5,929
Operating income 3,414 3,745 9,916 11,117
Other income (expense)
Interest expense (639 ) (663 ) (1,928 ) (1,953 )
Investment income (loss), net 464 21 549 254
Equity in net income (losses) of investees, net (130 ) 33 (96 ) 87
Other income (expense), net (310 ) (96 ) (280 ) (150 )
(615 ) (705 ) (1,755 ) (1,762 )
Income before income taxes 2,799 3,040 8,161 9,355
Income tax expense (1,021 ) (407 ) (2,994 ) (2,759 )
Net income 1,778 2,633 5,167 6,596
Net (income) loss attributable to noncontrolling interests and redeemable subsidiary preferred stock (46 ) (41 ) (264 ) (141 )
Net income attributable to Comcast Corporation $1,732 $2,592 $4,903 $6,455
Diluted earnings per common share attributable to Comcast Corporation shareholders $0.65 $0.99 $1.84 $2.46

Dividends declared per common share attributable to Comcast Corporation shareholders

$0.195 $0.225 $0.585 $0.675

Diluted weighted-average number of common shares

2,658 2,616 2,668 2,629
TABLE 2
Condensed Consolidated Balance Sheet (Unaudited)
(in millions) December 31, September 30,
2013 2014
ASSETS
Current Assets
Cash and cash equivalents $1,718 $4,547
Investments 3,573 531
Receivables, net 6,376 6,172
Programming rights 928 992
Other current assets 1,480 1,694
Total current assets 14,075 13,936
Film and television costs 4,994 5,560
Investments 3,770 3,129
Property and equipment, net 29,840 30,362
Franchise rights 59,364 59,364
Goodwill 27,098 27,323
Other intangible assets, net 17,329 17,089
Other noncurrent assets, net 2,343 2,474
$158,813 $159,237
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable and accrued expenses related to trade creditors $5,528 $5,680
Accrued participations and residuals 1,239 1,444
Deferred revenue 898 976
Accrued expenses and other current liabilities 7,967 5,461
Current portion of long-term debt 3,280 3,523
Total current liabilities 18,912 17,084
Long-term debt, less current portion 44,567 44,827
Deferred income taxes 31,935 32,227
Other noncurrent liabilities 11,384 10,388
Redeemable noncontrolling interests and redeemable subsidiary preferred stock 957 1,058
Equity
Comcast Corporation shareholders’ equity 50,694 53,298
Noncontrolling interests 364 355
Total equity 51,058 53,653
$158,813 $159,237
TABLE 3
Consolidated Statement of Cash Flows (Unaudited)
(in millions) Nine Months Ended
September 30,
2013 2014
OPERATING ACTIVITIES
Net income $5,167 $6,596
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 5,873 5,929
Share-based compensation 312 386
Noncash interest expense (income), net 122 132
Equity in net (income) losses of investees, net 96 (87 )
Cash received from investees 89 71
Net (gain) loss on investment activity and other (239 ) (24 )
Deferred income taxes (52 ) 358
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:
Current and noncurrent receivables, net 145 89
Film and television costs, net 408 (471 )
Accounts payable and accrued expenses related to trade creditors (108 ) 119
Other operating assets and liabilities (134 ) (796 )
Net cash provided by operating activities 11,679 12,302
INVESTING ACTIVITIES
Capital expenditures (4,593 ) (5,196 )
Cash paid for intangible assets (694 ) (735 )
Acquisitions and construction of real estate properties (1,705 ) (28 )
Acquisitions, net of cash acquired (42 ) (477 )
Proceeds from sales of businesses and investments 655 622
Return of capital from investees 146 6
Purchases of investments (1,177 ) (145 )
Other 83 (127 )
Net cash provided by (used in) investing activities (7,327 ) (6,080 )
FINANCING ACTIVITIES
Proceeds from (repayments of) short-term borrowings, net 395 (437 )
Proceeds from borrowings 2,933 4,182
Repurchases and repayments of debt (2,442 ) (3,172 )
Repurchases and retirements of common stock (1,500 ) (2,250 )
Dividends paid (1,454 ) (1,676 )
Issuances of common stock 35 33
Purchase of NBCUniversal noncontrolling common equity interest (10,761 ) -
Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock (164 ) (170 )
Settlement of Station Venture liability (602 ) -
Other (140 ) 97
Net cash provided by (used in) financing activities (13,700 ) (3,393 )
Increase (decrease) in cash and cash equivalents (9,348 ) 2,829
Cash and cash equivalents, beginning of period 10,951 1,718
Cash and cash equivalents, end of period $1,603 $4,547
TABLE 4
Supplemental Information
Alternate Presentation of Net Cash Provided by Operating Activities and Free Cash Flow (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2013 2014 2013 2014
Operating income $3,414 $3,745 $9,916 $11,117
Depreciation and amortization 1,916 1,959 5,873 5,929
Operating income before depreciation and amortization 5,330 5,704 15,789 17,046
Noncash share-based compensation expense 99 120 312 386
Changes in operating assets and liabilities 165 562 583 (343 )
Cash basis operating income 5,594 6,386 16,684 17,089
Payments of interest (636 ) (656 ) (1,768 ) (1,820 )
Payments of income taxes (958 ) (974 ) (3,180 ) (2,878 )
Excess tax benefits under share-based compensation (29 ) (34 ) (176 ) (240 )
Other 23 33 119 151
Net Cash Provided by Operating Activities $3,994 $4,755 $11,679 $12,302
Capital expenditures (1,726 ) (1,950 ) (4,593 ) (5,196 )
Cash paid for capitalized software and other intangible assets (250 ) (258 ) (694 ) (735 )
Distributions to noncontrolling interests and dividends for redeemable subsidiary preferred stock (48 ) (53 ) (164 ) (170 )
Nonoperating items(1) (2 ) - 826 272
Total Free Cash Flow $1,968 $2,494 $7,054 $6,473
Reconciliation of EPS Excluding Favorable Income Tax Adjustments, Gains on Sales, Acquisition-Related Items, Pension Termination Costs and Losses on Investments (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2013 2014 2013 2014
(in millions, except per share data)
$

EPS(2)

$

EPS(2)

$

EPS(2)

$

EPS(2)

Net income attributable to Comcast Corporation $1,732 $0.65 $2,592 $0.99 $4,903 $1.84 $6,455 $2.46
Growth % 49.7% 52.3% 31.7% 33.7%
Favorable income tax adjustments(3) (724) (0.28) (724) (0.28)
Gains on sales of investments(4) (279) (0.11) - - (279) (0.11) (97) (0.04)
Favorable resolution of a contingency of an acquired company(5) - - (27) (0.01)
Costs related to Time Warner Cable and Charter transactions(6) 49 0.02 87 0.04
Gain on sale of wireless spectrum licenses(7) - - (67) (0.03) - -
Pension termination costs(8) 46 0.02 - - 46 0.02 - -
Losses on investments(9) 234 0.09 - - 234 0.09 - -
Net income attributable to Comcast Corporation
(excluding favorable income tax adjustments, gains on sales, acquisition-related items, pension termination costs and losses on investments) $1,733 $0.65 $1,917 $0.73 $4,837 $1.81 $5,694 $2.17
Growth % 10.6% 12.3% 17.7% 19.9%
(1) Nonoperating items include adjustments for cash taxes paid related to certain investing and financing transactions, to reflect cash taxes paid in the year of the related taxable income and to exclude the impacts of Economic Stimulus packages. Net cash provided by operating activities for 2014 includes a $150 million increase in July 2014 resulting from a change in our credit card payment processes that resulted in the acceleration of the recognition of cash receipts in Cable Communications. For free cash flow purposes, we consider the acceleration to be nonrecurring in nature and therefore, we excluded this amount from free cash flow as a nonoperating item.
(2) Based on diluted weighted-average number of common shares for the respective periods as presented in Table 1.
(3) 3rd quarter 2014 net income attributable to Comcast Corporation includes $724 million of favorable income tax adjustments resulting from adjustments of uncertain tax positions.
(4) 2014 year to date net income attributable to Comcast Corporation includes $154 million of investment income, $97 million net of tax, resulting from sales of investments. 3rd quarter 2013 net income attributable to Comcast Corporation includes $443 million of investment income, $279 million net of tax, resulting from the sale of the investment in Clearwire.
(5) 2014 year to date net income attributable to Comcast Corporation includes $27 million of other income, resulting from the favorable resolution of a contingency related to the AT&T Broadband transaction.
(6) 3rd quarter 2014 net income attributable to Comcast Corporation includes $77 million of operating costs and expenses, $49 million net of tax, related to the Time Warner Cable and Charter transactions. 2014 year to date net income attributable to Comcast Corporation includes $138 million of operating costs and expenses, $87 million net of tax, related to the Time Warner Cable and Charter transactions.
(7) 2013 year to date net income attributable to Comcast Corporation includes $108 million of other income, $67 million net of tax, resulting from a gain on the sale of wireless spectrum licenses.
(8) 3rd quarter 2013 net income attributable to Comcast Corporation includes $74 million of other operating and administrative expenses, $46 million net of tax, resulting from the termination of a pension plan.
(9) 3rd quarter 2013 net income attributable to Comcast Corporation includes $371 million of expense ($236 million of other expense and $135 million of equity in net losses of investees), $234 million net of tax, resulting from losses on investments.

Note: Minor differences may exist due to rounding.

TABLE 5
Reconciliation of Consolidated Revenue Excluding 2014 Olympics and Operating Cash Flow Excluding Costs Related to Time Warner Cable and Charter Transactions and Pension Termination Costs (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2013 2014 Growth % 2013 2014 Growth %
Revenue $16,151 $16,791 4.0% $47,731 $51,043 6.9%
2014 Olympics - (1,103)
Revenue excluding 2014 Olympics $16,151 $16,791 4.0% $47,731 $49,940 4.6%
2013 2014 Growth % 2013 2014 Growth %
Operating Cash Flow $5,330 $5,704 7.0% $15,789 $17,046 8.0%
Costs related to Time Warner Cable and Charter transactions 77 138
Pension termination costs 74 - 74 -
Operating Cash Flow excluding costs related to Time Warner Cable and Charter transactions and pension termination costs $5,404 $5,781 7.0% $15,863 $17,184 8.3%
Reconciliation of Consolidated NBCUniversal Revenue Excluding 2014 Olympics (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2013 2014 Growth % 2013 2014 Growth %
Revenue $5,851 $5,921 1.2% $17,186 $18,813 9.5%
2014 Olympics - (1,103)
Revenue excluding 2014 Olympics $5,851 $5,921 1.2% $17,186 $17,710 3.0%
Reconciliation of Cable Networks Revenue Excluding 2014 Olympics (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2013 2014 Growth % 2013 2014 Growth %
Revenue $2,239 $2,255 0.7% $6,877 $7,236 5.2%
2014 Olympics - (257)
Revenue excluding 2014 Olympics $2,239 $2,255 0.7% $6,877 $6,979 1.5%
Reconciliation of Broadcast Television Revenue Excluding 2014 Olympics (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
(in millions) 2013 2014 Growth % 2013 2014 Growth %
Revenue $1,644 $1,770 7.7% $4,893 $6,207 26.9%
2014 Olympics - (846)
Revenue excluding 2014 Olympics $1,644 $1,770 7.7% $4,893 $5,361 9.6%

Note: Minor differences may exist due to rounding.

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