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TCI stock stumbles 5% in 2nd quarter

Cable biz gets cash flow boost

NEW YORK — Shares of Tele-Communications Inc. fell nearly 5% Friday as the country’s No. 1 cabler, which is being bought by AT&T Corp. for $48 billion, reported a smaller net loss on reduced revenues.

TCI’s net loss narrowed 11.3% to $142 million in the quarter ended June 30 while revenues, affected by the push to cluster cable systems by geographic region, fell 6.4% to $1.5 billion.

Operating cash flow (or earnings before interest, taxes, deprecation, amortization and nonrecurring items) was down as well, falling 5.4% to $627 million.

The results were significantly below analyst expectations, although those varied considerably due to the Byzantine nature of TCI’s structure and operations.

Cited among the company’s activities during the second quarter were:

  • A partnership with InterMedia Capital Management and the Blackstone Group, resulting in the elimination of $812 million in debt and the transfer of 430,000 customers to the partnership; and

  • The sale of TCI’s Tucson/Sierra Vista cable system to Cox Communications for $250 million, resulting in the transfer of 111,000 customers to Cox.

Contrary to the company at large, TCI’s current cable operations, once adjusted to provide meaningful year-to-year comparisons, saw its operating cash flow increase 3.0% to $627 million as sales gained 5.4% to $1.5 billion.

In addition to cable, TCI’s results include its developing high-speed data service business, the Kearns-Tribune newspaper assets and other relatively minor operations. The results also include contributions from TCI units Liberty Media and TCI Ventures, which reported their results separately as well.

TCI’s stock gave up $1.81 on the news to close Friday at $36.44.

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