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Last updated on April 23, 2014 at 12:54 EDT

GCI Reports 2012 Financial Results

March 6, 2013

- Consolidated revenue of $710.2 million

ANCHORAGE, Alaska, March 6, 2013 /PRNewswire-FirstCall/ — General Communication, Inc. (“GCI”) (NASDAQ: GNCMA) today reported its 2012 results with revenues increasing to $710.2 million over revenues of $679.4 million in 2011, an increase of $30.8 million or 4.5 percent. Adjusted EBITDA of $226.8 million increased $3.2 million or 1.4 percent over 2011 EBITDA of $223.6 million. Adjusted EBITDA for the year 2012 was offset by $3.0 million of expenses related to the Alaska Wireless Network (“AWN”) transaction.

Net income for 2012 totaled $9.7 million or earnings per diluted share of $0.23, an increase over net income of $5.7 million or earnings per diluted share of $0.12 for 2011.

For the fourth quarter of 2012, revenues totaled $183.7 million, an increase of $14.9 million or 8.8 percent over revenues of $168.8 million in the fourth quarter of 2011. Revenues were up $5.2 million or 2.9 percent sequentially when compared to third quarter 2012 revenues of $178.5 million. Adjusted EBITDA for the fourth quarter of 2012 was $53.1 million, an increase of $0.8 million or 1.6 percent over the fourth quarter of 2011 and a decrease of 10.7 percent from the third quarter of 2012. The sequential decrease in EBITDA was primarily due to an increase in COGS and selling, general and administrative costs.

“GCI’s results for 2012 were mostly on track with our expectations,” said Ron Duncan, GCI president. “Consumer Internet and managed broadband both had very strong years and we launched the iPhone to very a very positive customer response, although at a high handset cost.”

“We incurred $3 million in AWN related transaction costs for the year. While we will incur more costs in 2013, the larger pre closing expense items are behind us. We continue planning for the AWN closing and the integration of GCI’s and Alaska Communications’ wireless networks. We look forward to announcing the achievement of this milestone following completion of the required regulatory approvals.”

GCI previously provided guidance on revenues of $690 million to $720 million and adjusted EBITDA of $230 million to $240 million for the year 2012, excluding expenses related to the Alaska Wireless Network (“AWN”) transaction. GCI’s revenue and EBITDA results for 2012 finished in the middle of the revenue range and slightly below the low end of the EBITDA range, excluding the $3.0 million in expenses related to the AWN transaction.

The AWN transaction is expected to close during the second quarter of 2013. The timing of such closing during the quarter will impact GCI’s 2013 results. GCI will issue guidance on consolidated revenues, EBITDA and AWN’s expected preferred distributions for 2013 after the AWN transaction has been approved and completed.

Highlights

  • Managed Broadband revenues for 2012 totaled $86.6 million, an increase of $23.3 million or 36.9 percent over 2011, primarily as a result of sales of broadband service on GCI’s TERRA-Southwest terrestrial network. This was the first full year of revenues following GCI’s significant investment in rural terrestrial network expansion.
  • GCI had 128,900 consumer and commercial cable modem customers at the end of 2012, an increase of 9,500 over the end of 2011. Fourth quarter cable modem customers increased by 4,200 over 124,700 customers at the end of the third quarter 2012. Average monthly revenue per cable modem for the fourth quarter of 2012 was $72.16, an increase of $11.84 over $60.32 posted for the prior year and $9.31 over $62.85 reported for the third quarter of 2012.
  • GCI entered into a third arrangement under the New Markets Tax Credit (NMTC) program to help fund Phase 3 of our TERRA-Northwest project. Phase 3 of our TERRA-NW project continues the extension of terrestrial broadband service to Kotzebue. The NMTC program was established in the Community Renewal Tax Relief Act of 2000 to induce capital investment in qualified low-income communities.

Consumer
Consumer revenues of $353.0 million for the year 2012 were steady as compared to 2011. An increase in data revenue offset the decreases in voice and video revenues. Fourth quarter 2012 revenues of $89.9 million increased $3.6 million over fourth quarter 2011 revenues of $86.3 million and increased $3.1 million sequentially. In the fourth quarter of 2012, growth in data and wireless revenues were offset mostly by the expected decrease in voice revenue when compared to the fourth quarter of 2011 and the third quarter of 2012.

Consumer voice revenues of $41.4 million decreased $10.6 million when compared to 2011 as customers continue to abandon wireline service and shift to wireless. Consumer local access lines in service at the end of 2012 totaled 69,700, a decrease of 7,900 lines from the end of 2011. USF high cost support for wired consumer voice services decreased $2.2 million from the prior year.

Fourth quarter 2012 consumer voice revenues of $9.7 million decreased $1.8 million from the fourth quarter of 2011 and $0.3 million sequentially. Total access lines decreased 2,200 lines sequentially.

Consumer video revenues of $115.3 million decreased $3.3 million or 2.8 percent from 2011. Fourth quarter 2012 video revenues of $28.7 million decreased by $0.9 million from the prior year and were steady on a sequential basis. The decrease is primarily due to a decline in basic video subscribers. Consumer basic video subscribers totaled 122,300 at the end of 2012, a decrease of 2,700 subscribers from 2011 and an increase of 100 subscribers over the third quarter of 2012. GCI has had a steady increase in the number of customers who subscribe only to cable modem service. Presumably these access-only customers are purchasing video programming from other sources including over-the-top providers such as Netflix and Hulu.

Consumer data revenues of $86.5 million increased $14.5 million or 20.1 percent over 2011. Fourth quarter 2012 data revenues of $23.1 million increased 16.0 percent over the prior year and 8.1 percent sequentially. The increase in consumer data revenues for the year and for the fourth quarter of 2012 is due to an increase in cable modem customers and increasing monthly usage. GCI added 7,300 consumer cable modem customers over 2011 and cable modem customer counts increased by 2,500 on a sequential basis. GCI had 115,600 consumer cable modem customers at the end of 2012 representing 94.5 percent of basic video subscribers. GCI projects consumer cable modem subscribers could exceed total consumer basic video subscribers by the end of 2013.

Consumer wireless revenues of $109.8 million for 2012 were steady with the prior year. Fourth quarter 2012 wireless revenues of $28.4 million increased $3.1 million or 12.2 percent over 2011 and $1.3 million or 4.9 percent sequentially. The increase was primarily due to an increase in plan revenue. GCI served 123,000 consumer wireless subscribers at the end of 2012. USF high cost support for consumer wireless services decreased $3.4 million from the prior year.

Consumer served 90,600 postpaid and pre-paid non-Lifeline wireless subscribers at the end of 2012, an increase of 8,400 over the end of the prior year and an increase of 3,300 wireless customers sequentially. Post paid subscribers increased 7,200 year over year and 5,900 sequentially. Prepaid subscribers increased 700 over the prior year and decreased by 2,300 customers sequentially. The sequential decrease in prepaid subscribers is seasonal.

GCI served 32,400 Lifeline customers at the end of 2012. In compliance with FCC Lifeline program reforms, GCI was required to recertify all Lifeline subscribers, enrolled as of June 1, 2012, by the end of 2012, with current subscribers to be recertified annually thereafter. The FCC recertification process contributed to a decrease of 10,000 Lifeline subscribers in 2012 and a decrease in Lifeline subsidy support revenues of $2.7 million. Lifeline subscribers declined by 3,100 on a sequential basis. Lifeline subscriber counts could decline further as a result of the annual recertification process or future program changes.

Network Access
Network access revenues of $105.4 million were steady with the prior year. Fourth quarter revenues of $26.8 million increased $1.0 million or 4.0 percent compared to 2011 and decreased $0.7 million or 2.6 percent on a sequential basis.

Voice revenues for 2012 decreased $1.1 million to $22.5 million from the prior year. The continued decrease in wireline voice revenues was expected and is primarily due to wireless and data substitution. Long distance minutes in 2012 decreased 2.0 percent from the prior year.

Data revenues were down $6.3 million when compared to $62.5 million in 2011. Fourth quarter 2012 data revenues decreased $1.0 million to $14.3 million from the prior year and were up slightly on a sequential basis. The decrease in data revenue when compared to the prior year on an annual and quarterly basis is primarily attributable to a decrease in special project revenue and rate compression.

Wireless revenues, primarily related to roaming traffic, increased $7.3 million to $26.8 million, an increase of 37.6 percent over the prior year. Fourth quarter revenues of $7.1 million increased $2.1 million or 42.8 percent over the prior year and decreased $0.6 million or 7.7 percent on a sequential basis. The decrease in quarterly sequential revenues is due to seasonality.

Commercial
Commercial revenues of $143.6 million increased $7.5 million or 5.5 percent over the prior year. Fourth quarter 2012 revenues of $38.6 million increased 11.8 percent over the fourth quarter of the prior year and 6.5 percent on a sequential basis.

Commercial data service revenues were $93.4 million in 2012, an increase of 8.7 percent over 2011. Fourth quarter 2012 revenues were $26.1 million, an increase of $3.8 million or 16.8 percent over the prior year quarter and a $2.4 million or 10.3 percent increase on a sequential basis. Commercial data service revenues include both transport charges for data circuits, professional services which are time and materials charges for GCI on-site support of customer operations and data center revenues. As summarized in the table below, data transport charges of $47.6 million increased by $3.2 million as compared to 2011, time and material charges for support activities increased by $3.4 million to $44.9 million and data center revenues increased by $0.8 million over 2011.

    Millions               $2012  2011 Q4 2012      Q4 2011
    --------               -----  ---- -------      -------

    Data Transport Charges $47.6 $44.4        $12.0        $11.4

    Professional Services   44.9  41.5         13.8         10.8

    Data Center Revenues     0.9   0.1          0.3          0.1
    --------------------     ---   ---          ---          ---

    Total Data Revenues    $93.4 $86.0        $26.1        $22.3

Commercial wireless revenues totaled $9.9 million for 2012 and were steady with the prior year. Fourth quarter 2012 revenues of $2.6 million were steady with the prior year quarter and on a sequential basis. GCI had 17,000 commercial wireless subscribers at the end of 2012, an increase of 1,700 subscribers over the prior year and an increase of 400 subscribers on a sequential basis.

Managed Broadband
Managed broadband revenues totaled $86.6 million in 2012, an increase of $23.3 million or 36.9 percent over the prior year. Fourth quarter 2012 revenue of $23.1 million increased $5.9 million or 34.4 percent over the prior year and $0.5 million or 2.0 percent sequentially. The strong revenue growth is primarily due to an increase in broadband capacity utilized on the TERRA Southwest terrestrial network. This was the first full year of revenues following GCI’s significant investment in rural network expansion.

Regulated Operations
Regulated operations revenues totaled $21.6 million in 2012, a decrease of $0.4 million from the prior year. Regulated operations revenues of $5.4 million for the fourth quarter of 2012 increased $0.3 million over the fourth quarter of 2011 and were steady with the third quarter of 2012. Regulated operations had 8,300 local access lines at the end of 2012, a decrease of 800 access lines from 2011 and a decrease of 200 access lines on a sequential basis.

Other Items
SG&A expenses for 2012 totaled $243.2 million, an increase of 3.3 percent as compared to $235.5 million for 2011. The increase is due to labor and related benefits and transaction costs related to AWN. As a percentage of revenues, SG&A expenses decreased to 34.3 percent in 2012 as compared to 34.7 percent in the prior year.

GCI’s 2012 capital expenditures totaled $165.7 million as compared to $186.4 million in 2011. Cash capital expenditures total $146.0 million for 2012 and compare to 177.1 million in 2011. GCI’s total capital expenditures for 2012 includes $20.2 million related to the TERRA-Northwest project all of which was funded with proceeds from our NMTC transactions and a grant from the Regulatory Commission of Alaska. GCI expects cash capital expenditures to total approximately $150 million for 2013, exclusive of the developing TV broadcast investment plan.

GCI will hold a conference call to discuss the quarter’s results on Thursday, March 7, 2013 beginning at 2 p.m. (Eastern). To access the briefing on March 7, call the conference operator between 1:50-2:00 p.m. (Eastern Time) at 888-942-9042 (International callers should dial 1-415-228-4668) and identify your call as “GCI.” In addition to the conference call, GCI will make available net conferencing. To access the call via net conference, log on to www.gci.com and follow the instructions. A replay of the call will be available for 72-hours by dialing 866-485-4168, access code 7461 (International callers should dial 1-203-369-1620.)

GCI is the largest telecommunications company in Alaska. GCI’s cable plant, which provides voice, video, and broadband data services, passes 78 percent of Alaska households. GCI operates Alaska’s most extensive terrestrial/subsea fiber optic network which connects not only Anchorage but also Fairbanks and Juneau/Southeast Alaska to the lower 48 states with a diversely routed, protected fiber network. GCI’s TERRA-Southwest fiber/microwave system links 65 communities in the Bristol Bay and Yukon-Kuskokwim Delta to Anchorage bringing terrestrial broadband Internet access to the region for the first time. GCI’s satellite network provides communications services to small towns and communities throughout rural Alaska. GCI’s statewide mobile wireless network seamlessly links urban and rural Alaska.

A pioneer in bundled services, GCI is the top provider of voice, data, and video services to Alaska consumers with a 70 percent share of the consumer broadband market. GCI is also the leading provider of communications services to enterprise customers, particularly large enterprise customers with complex data networking needs. More information about GCI can be found at www.gci.com.

The foregoing contains forward-looking statements regarding GCI’s expected results that are based on management’s expectations as well as on a number of assumptions concerning future events. Actual results might differ materially from those projected in the forward looking statements due to uncertainties and other factors, many of which are outside GCI’s control. Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements is contained in GCI’s cautionary statement sections of Forms 10-K and 10-Q filed with the Securities and Exchange Commission.

                           GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                                   CONSOLIDATED BALANCE SHEETS

                                           (Unaudited)

     (Amounts
     in
     thousands)

                                          December 31,                  December 31,

                    Assets                                 2012                          2011
                    ------                                 ----                          ----

     Current
     assets:

      Cash
       and
       cash
       equivalents                                      $24,491                        29,387

      Receivables                                       150,436                       141,827

      Less
       allowance
       for
       doubtful
       receivables                                        3,215                         5,796
                                                          -----                         -----

         Net
          receivables                                   147,221                       136,031

       Deferred
       income
       taxes                                             12,897                        15,555

       Prepaid
       expenses                                           8,441                         7,899

      Inventories                                        12,098                         7,522

      Other
       current
       assets                                             1,678                         3,631
                                                          -----                         -----

           Total
            current
            assets                                      206,826                       200,025

     Property
     and
     equipment
     in
     service,
     net
     of
     depreciation                                       838,247                       849,121

     Construction
     in
     progress                                            94,418                        42,918
                                                         ------                        ------

           Net
            property
            and
            equipment                                   932,665                       892,039

    Cable
     certificates                                       191,635                       191,635

    Goodwill                                             77,294                        74,883

     Wireless
     licenses                                            25,967                        25,967

     Restricted
     cash                                                30,933                        15,910

    Other
     intangible
     assets,
     net
     of
     amortization                                        16,560                        15,835

     Deferred
     loan
     and
     senior
     notes
     costs,
     net
     of
     amortization                                        11,189                        12,812

    Other
     assets                                              13,453                        17,214
                                                         ------                        ------

        Total
         other
         assets                                         367,031                       354,256
                                                        -------                       -------

           Total
            assets                                   $1,506,522                     1,446,320
                                                     ==========                     =========

                                                                                  (Continued)

                                          GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                                                   CONSOLIDATED BALANCE SHEETS

                                                           (Unaudited)

                                                           (Continued)

    (Amounts in thousands)

                                                          December 31,                 December 31,

            Liabilities and Stockholders'
                        Equity                                               2012                        2011
            -----------------------------                                    ----                        ----

    Current liabilities:

      Current maturities of
       obligations under long-term
       debt and capital leases                                             $7,923                       8,797

      Accounts payable                                                     52,384                      41,353

      Deferred revenue                                                     25,218                      22,003

      Accrued payroll and payroll
       related obligations                                                 19,440                      22,126

      Accrued interest                                                      6,786                       6,680

      Accrued liabilities                                                  15,242                      11,423

      Subscriber deposits                                                   1,366                       1,250
                                                                            -----                       -----

         Total current liabilities                                        128,359                     113,632

    Long-term debt, net                                                   875,123                     858,031

    Obligations under capital
     leases, excluding current
     maturities                                                            72,725                      78,605

    Obligation under capital lease
     due to related party,
     excluding current maturity                                             1,892                       1,893

    Deferred income taxes                                                 123,661                     114,234

    Long-term deferred revenue                                             89,815                      81,822

    Other liabilities                                                      25,511                      24,456
                                                                           ------                      ------

           Total liabilities                                            1,317,086                   1,272,673

    Commitments and contingencies

    Stockholders' equity:

      Common stock (no par):

       Class A. Authorized 100,000
        shares; issued 38,534 and
        39,296 shares at December 31,
        2012 and 2011, respectively;
        outstanding 38,357 and 39,043
        shares at December 31, 2012
        and 2011, respectively                                             22,703                      26,179

        Class B. Authorized 10,000
         shares; issued and
         outstanding 3,169 and 3,171
         shares at December 31, 2012
         and 2011, respectively;
         convertible on a share-per-
         share basis into Class A
         common stock                                                       2,676                       2,679

        Less cost of 177 and 253 Class
         A common shares held in
         treasury at December 31, 2012
         and 2011, respectively                                            (1,617)                     (2,225)

      Paid-in capital                                                      25,832                      32,795

      Retained earnings                                                   107,584                      97,911

           Total General Communication,
            Inc. stockholders' equity                                     157,178                     157,339

      Non-controlling interests                                            32,258                      16,308
                                                                           ------                      ------

           Total stockholders' equity                                     189,436                     173,647
                                                                          -------                     -------

           Total liabilities and
            stockholders' equity                                       $1,506,522                   1,446,320
                                                                       ==========                   =========

                       GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                              CONSOLIDATED INCOME STATEMENTS

                       YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010

                                                           (Unaudited)

    (Amounts in thousands,
     except per share
     amounts)                                    2012                 2011      2010
                                                 ----                 ----      ----

    Revenues                                 $710,181             $679,381  $651,250

    Cost of goods sold
     (exclusive of
     depreciation and
     amortization shown
     separately below)                        247,501              227,399   207,817

    Selling, general and
     administrative expenses                  243,248              235,521   228,808

    Depreciation and
     amortization expense                     130,452              125,937   126,699
                                              -------              -------   -------

       Operating income                        88,980               90,524    87,926

    Other income (expense):

      Interest expense
       (including amortization
       of deferred loan fees)                 (67,747)             (68,258)  (70,329)

      Loss on extinguishment
       of debt                                      -               (9,111)        -

      Other                                        17                 (264)      261

       Other expense, net                     (67,730)             (77,633)  (70,068)
                                              -------              -------   -------

       Income before income tax
        expense                                21,250               12,891    17,858

    Income tax expense                         12,088                7,405     9,248
                                               ------                -----     -----

       Net income                               9,162                5,486     8,610

    Net loss attributable to
     the non-controlling
     interests                                    511                  238         -
                                                  ---                  ---       ---

       Net income attributable
        to General
        Communication, Inc.                    $9,673               $5,724    $8,610
                                               ======               ======    ======

    Basic net income
     attributable to General
     Communication, Inc.
     common stockholders per
     Class A common share                       $0.23                $0.13     $0.16
                                                =====                =====     =====

    Basic net income
     attributable to General
     Communication, Inc.
     common stockholders per
     Class B common share                       $0.23                $0.13     $0.16
                                                =====                =====     =====

    Diluted net income
     attributable to General
     Communication, Inc.
     common stockholders per
     Class A common share                       $0.23                $0.12     $0.16
                                                =====                =====     =====

    Diluted net income
     attributable to General
     Communication, Inc.
     common stockholders per
     Class B common share                       $0.23                $0.12     $0.16
                                                =====                =====     =====

    Common shares used to
     calculate Class A basic
     EPS                                       38,560               42,175    50,076
                                               ======               ======    ======

    Common shares used to
     calculate Class A
     diluted EPS                               42,119               45,889    53,426
                                               ======               ======    ======

                                                                                                                               GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                                                                                                                                          SUPPLEMENTAL SCHEDULES

                                                                                                                                                (Unaudited)

    (Amounts in thousands)

                                   Fourth Quarter 2012                                              Fourth Quarter 2011
                                   -------------------                                              -------------------

                                                      Network                             Managed                    Regulated                                                               Network                           Managed          Regulated

                           Consumer                    Access         Commercial         Broadband                  Operations                    Totals                    Consumer          Access        Commercial        Broadband        Operations        Totals
                           --------                    ------         ----------         ---------                  ----------                    ------                    --------          ------        ----------        ---------        ----------        ------

    Revenues

      Voice                           $9,708                   5,306              6,591                 -                         5,360                    26,965                    $11,511          5,429             6,662                -            5,044          28,646

      Video                           28,656                       -              3,343                 -                             -                    31,999                     29,595              -             2,999                -                -          32,594

      Data                            23,115                  14,336             26,058            23,131                             -                    86,640                     19,931         15,321            22,308           17,207                -          74,767

      Wireless                        28,379                   7,125              2,568                 -                             -                    38,072                     25,299          4,991             2,515                -                -          32,805

        Total                         89,858                  26,767             38,560            23,131                         5,360                   183,676                     86,336         25,741            34,484           17,207            5,044         168,812

    Cost of goods sold                36,092                   5,953             19,086             6,911                         1,772                    69,814                     27,938          5,972            16,140            3,987            1,628          55,665
                                      ------                   -----             ------             -----                         -----                    ------                     ------          -----            ------            -----            -----          ------

        Contribution                  53,766                  20,814             19,474            16,220                         3,588                   113,862                     58,398         19,769            18,344           13,220            3,416         113,147

    Less SG&A                         35,146                   6,903             10,709             6,319                         2,913                    61,990                     36,550          8,189            10,959            5,234            3,546          64,478

    Less Other expense                     -                       -                  -               115                             -                       115                          -              -                 -              205                -             205

        EBITDA                        18,620                  13,911              8,765             9,786                           675                    51,757                     21,848         11,580             7,385            7,781             (130)         48,464

    Add share-based
     compensation                        539                     158                228               117                             8                     1,050                      1,769            646               630              335               16           3,396

    Add accretion                        (19)                     (6)                (5)               (3)                            -                       (33)                        93             30                27               13                -             163

    Add loss from
     noncontrolling
     interests                             -                       -                  -               336                             -                       336                          -              -                 -              238                -             238

        Adjusted EBITDA              $19,140                  14,063              8,988            10,236                           683                    53,110                    $23,710         12,256             8,042            8,367             (114)         52,261
                                     =======                  ======              =====            ======                           ===                    ======                    =======         ======             =====            =====             ====          ======

                                                                                                                                 GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                                                                                                                                            SUPPLEMENTAL SCHEDULES

                                                                                                                                                 (Unaudited)

    (Amounts in thousands)

                                         Fourth Quarter 2012                                                Third Quarter 2012
                                       -------------------                                             ------------------

                                                            Network                             Managed                      Regulated                                                         Network                           Managed           Regulated

                                 Consumer                    Access         Commercial         Broadband                    Operations                    Totals              Consumer          Access        Commercial        Broadband         Operations       Totals
                                 --------                    ------         ----------         ---------                    ----------                    ------              --------          ------        ----------        ---------         ----------       ------

    Revenues

      Voice                                 $9,708                   5,306              6,591                   -                         5,360                    26,965               $9,968          5,664             6,896                -             5,319         27,847

      Video                                 28,656                       -              3,343                   -                             -                    31,999               28,394              -             3,142                -                 -         31,536

      Data                                  23,115                  14,336             26,058              23,131                             -                    86,640               21,379         14,093            23,622           22,685                 -         81,779

      Wireless                              28,379                   7,125              2,568                   -                             -                    38,072               27,066          7,718             2,548                -                 -         37,332

        Total                               89,858                  26,767             38,560              23,131                         5,360                   183,676               86,807         27,475            36,208           22,685             5,319        178,494

    Cost of goods sold                      36,092                   5,953             19,086               6,911                         1,772                    69,814               33,027          6,194            16,607            5,230             1,696         62,754
                                            ------                   -----             ------               -----                         -----                    ------               ------          -----            ------            -----             -----         ------

        Contribution                        53,766                  20,814             19,474              16,220                         3,588                   113,862               53,780         21,281            19,601           17,455             3,623        115,740

    Less SG&A                               35,146                   6,903             10,709               6,319                         2,913                    61,990               33,699          6,157            10,028            5,723             2,621         58,228

    Less Other expense                           -                       -                  -                 115                             -                       115                    -              -                 -             (164)                -           (164)

        EBITDA                              18,620                  13,911              8,765               9,786                           675                    51,757               20,081         15,124             9,573           11,896             1,002         57,676

    Add share-based compensation               539                     158                228                 117                             8                     1,050                  723            224               286              155                 7          1,395

    Add accretion                              (19)                     (6)                (5)                 (3)                            -                       (33)                 112             35                33               21                 -            201

    Add loss from noncontrolling
     interests                                   -                       -                  -                 336                             -                       336                    -              -                 -              177                 -            177

    Add non-cash contribution                    -                       -                  -                   -                             -                         -                    -              -                 -                -                 -              -

        Adjusted EBITDA                    $19,140                  14,063              8,988              10,236                           683                    53,110              $20,916         15,383             9,892           12,249             1,009         59,449
                                           =======                  ======              =====              ======                           ===                    ======              =======         ======             =====           ======             =====         ======

                                                                                                                                   GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                                                                                                                                              SUPPLEMENTAL SCHEDULES

                                                                                                                                                    (Unaudited)

    (Amounts in thousands)

                           Twelve Months Ended December 31, 2012                               Twelve Months Ended December 31, 2011
                           -------------------------------------                               -------------------------------------

                                                        Network                             Managed                      Regulated                                                                Network                             Managed          Regulated

                            Consumer                    Access          Commercial         Broadband                    Operations                    Totals                    Consumer          Access          Commercial         Broadband        Operations        Totals
                            --------                    ------          ----------         ---------                    ----------                    ------                    --------          ------          ----------         ---------        ----------        ------

    Revenues

      Voice                           $41,439                    22,496             27,377                  -                        21,625                   112,937                     $52,052          23,553             28,712                -            22,002        126,319

      Video                           115,307                         -             12,841                  -                             -                   128,148                     118,635               -             11,605                -                 -        130,240

      Data                             86,466                    56,194             93,434             86,562                             -                   322,656                      71,977          62,456             85,961           63,248                 -        283,642

      Wireless                        109,760                    26,757              9,923                  -                             -                   146,440                     109,910          19,447              9,823                -                 -        139,180

        Total                         352,972                   105,447            143,575             86,562                        21,625                   710,181                     352,574         105,456            136,101           63,248            22,002        679,381

    Cost of goods sold                128,324                    24,356             66,895             21,298                         6,628                   247,501                     110,693          28,744             65,170           17,021             5,771        227,399
                                      -------                    ------             ------             ------                         -----                   -------                     -------          ------             ------           ------             -----        -------

        Contribution                  224,648                    81,091             76,680             65,264                        14,997                   462,680                     241,881          76,712             70,931           46,227            16,231        451,982

    Less SG&A                         139,191                    26,841             42,014             24,087                        11,115                   243,248                     134,951          27,837             41,085           18,246            13,402        235,521

    Less Other expense                      -                         -                  -                 (2)                            -                        (2)                          -               -                  -              297                 -            297
                                                                                                                                                                  ---                                                                                                              ---

        EBITDA                         85,457                    54,250             34,666             41,179                         3,882                   219,434                     106,930          48,875             29,846           27,684             2,829        216,164

    Add share-based
     compensation                       2,586                       790              1,041                595                            28                     5,040                       3,457           1,214              1,276              657                16          6,620

    Add accretion                         533                       169                156                102                             -                       960                         347             120                100               52                 -            619

    Add loss from
     noncontrolling
     interests                              -                         -                  -                867                             -                       867                           -               -                  -              238                 -            238

    Add non-cash
     contribution
     adjustment                           282                        89                 83                 54                             -                       508                           -               -                  -                -                 -              -

        Adjusted EBITDA               $88,858                    55,298             35,946             42,797                         3,910                   226,809                    $110,734          50,209             31,222           28,631             2,845        223,641
                                      =======                    ======             ======             ======                         =====                   =======                    ========          ======             ======           ======             =====        =======

                                                                   GENERAL COMMUNICATION, INC. AND SUBSIDIARIES

                                                                            KEY PERFORMANCE INDICATORS

                                                                                    (Unaudited)

                                                                                                         December 31, 2012                December 31, 2012

                                                                                                           as compared to                   as compared to

                                   December 31,            December 31,   September 30,                     December 31,   September 30,                     December 31, September 30,

                                                                    2012           2011            2012                             2011               2012                        2011   2012
                                                                    ----           ----            ----                             ----               ----                        ----   ----

    Consumer

    Voice

                         Local service lines in service           69,700         77,600          71,900                           (7,900)            (2,200)                      -10.2%  -3.1%

                          Local access lines in service on
                          GCI facilities                          64,900         72,000          66,900                           (7,100)            (2,000)                       -9.9%  -3.0%

    Video

                         Basic subscribers                       122,300        125,000         122,200                           (2,700)               100                        -2.2%   0.1%

                          Digital programming tier
                          subscribers                             72,500         75,600          72,000                           (3,100)               500                        -4.1%   0.7%

                         HD/DVR converter boxes                   90,400         89,400          89,200                            1,000              1,200                         1.1%   1.3%

                         Homes passed                            243,600        242,100         242,400                            1,500              1,200                         0.6%   0.5%

    Data

                         Cable modem subscribers                 115,600        108,300         113,100                            7,300              2,500                         6.7%   2.2%

    Wireless

                          Wireless Lifeline lines in
                          service                                 32,400         42,400          35,500                          (10,000)            (3,100)                      -23.6%  -8.7%

                          Wireless Postpaid lines in
                          service                                 81,600         73,900          76,000                            7,700              5,600                        10.4%   7.4%

                          Wireless Prepaid lines in
                          service                                  9,000          8,300          11,300                              700             (2,300)                        8.4% -20.4%

    Commercial

    Voice

                          Total local access lines in
                          service                                 51,600         51,400          51,800                              200               (200)                        0.4%  -0.4%

                          Local access lines in service on
                          GCI facilities                          30,800         28,700          30,500                            2,100                300                         7.3%   1.0%

    Video

                          Hotels and mini-headend
                          subscribers                             15,800         15,700          18,500                              100             (2,700)                        0.6% -14.6%

                         Basic subscribers                         1,900          1,900           1,900                                -                  -                         0.0%   0.0%

                            Total basic subscribers               17,700         17,600          20,400                              100             (2,700)                        0.6% -13.2%
                                                                  ======         ======          ======                                                 ===                                ===

    Data

                         Cable modem subscribers                  13,300         11,100          11,600                            2,200              1,700                        19.8%  14.7%

    Wireless

                         Wireless lines in service                17,000         15,300          16,600                            1,700                400                        11.1%   2.4%

    Regulated Operations

    Voice:

                          Total local access lines in
                          service                                  8,300          9,100           8,500                             (800)              (200)                       -8.8%  -2.4%

                                                                                                                   December 31, 2012                                December 31, 2012

                                         Three Months Ended                                as Compared to           as Compared to

                                            December 31,             December 31,           September 30,            December 31,             September 30,                December 31,  September 30,

                                                                2012                  2011                    2012                       2011                  2012                 2011           2012
                                                                ----                  ----                    ----                       ----                  ----                 ----           ----

    Consumer

    Video

             Average monthly revenue per
             subscriber                                     $77.99                $78.51                  $77.45                     $(0.52)                $0.54                 -0.7%           0.7%

    Wireless

             Average monthly revenue per
             subscriber                                     $71.85                $61.40                  $67.98                     $10.45                 $3.87                 17.0%           5.7%

    Total

    Voice

             Long-distance minutes
             carried (in millions)                           227.2                 231.3                   243.0                       (4.1)                (15.8)                -1.8%          -6.5%

    Data

             Average monthly revenue per
             cable modem subscriber                         $72.16                $60.32                  $62.85                     $11.84                 $9.31                 19.6%          14.8%

    General Communication, Inc.

    Non-GAAP Financial Reconciliation Schedule

    (Unaudited, Amounts in Millions)

                                                                  Three Months Ended

                                           December 31,        December 31,                September 30,

                                                         2012                        2011                2012
                                                         ----                        ----                ----

    Net income (loss)                                    $0.6                        (1.1)                3.5

    Income tax expense (benefit)                          1.7                         0.1                 5.3
                                                          ---                         ---

    Income (loss) before income tax
     expense (benefit)                                    2.3                        (1.0)                8.8

    Other expense:

    Interest expense (including
     amortization of deferred loan
     fees)                                               16.8                        16.9                16.8

    Other                                                 0.2                         0.2                (0.2)
                                                                                      ---

    Other expense, net                                   17.0                        17.1                16.6
                                                         ----                        ----                ----

    Operating income                                     19.3                        16.1                25.4

    Depreciation and amortization
     expense                                             32.6                        32.6                32.1

    Equity investment                                    (0.1)                       (0.2)                0.2

    EBITDA (Note 2)                                      51.8                        48.5                57.7

    Share-based compensation                              1.0                         3.4                 1.4

    Accretion                                         -                 0.2                          0.2

    Non-controlling interests                             0.3                         0.2                 0.1

    Adjusted EBITDA (Note
     1)                                                 $53.1                        52.3                59.4

    General Communication, Inc.

    Non-GAAP Financial Reconciliation Schedule

    (Unaudited, Amounts in Millions)

                                                               Year Ended

                                               December 31,         December 31,

                                                              2012                 2011
                                                              ----                 ----

    Net income                                                $9.2                  5.5

    Income tax expense                                        12.1                  7.4
                                                              ----                  ---

    Income before income tax expense                          21.3                 12.9

    Other expense:

    Interest expense (including
     amortization of deferred loan fees)                      67.7                 68.3

    Loss on extinguishment of debt                        -                  9.1

    Other                                                 -                  0.2
                                                        ---                  ---

    Other expense, net                                        67.7                 77.6
                                                              ----                 ----

    Operating income                                          89.0                 90.5

    Depreciation and amortization expense                    130.4                125.9

    Other                                                 -                 (0.2)

    EBITDA (Note 2)                                          219.4                216.2

    Share-based compensation                                   5.0                  6.6

    Accretion                                                  0.5                  0.6

    Non-controlling interests                                  0.9                  0.2

    Non-cash contribution adjustment                           1.0                    -
                                                               ---                  ---

    Adjusted EBITDA (Note 1)                                $226.8                223.6


    Notes:

             (1)   EBITDA (as defined in Note 2 below)
                   before deducting share-based
                   compensation, accretion expense,
                   and net loss attributable to non-
                   controlling interests and non-
                   cash contribution adjustment.

             (2)   Earnings Before Interest, Taxes,
                   Depreciation and Amortization is
                   the sum of Net Income, Interest
                   Expense (including Amortization of
                   Deferred Loan Fees), Interest
                   Income, Income Tax Expense, and
                   Depreciation and Amortization
                   Expense. EBITDA is not presented
                   as an alternative measure of net
                   income, operating income or cash
                   flow from operations, as
                   determined in accordance with
                   accounting principles generally
                   accepted in the United States of
                   America. GCI's management uses
                   EBITDA to evaluate the operating
                   performance of its business, and
                   as a measure of performance for
                   incentive compensation purposes.
                   GCI believes EBITDA is a measure
                   used as an analytical indicator of
                   income generated to service debt
                   and fund capital expenditures. In
                   addition, multiples of current or
                   projected EBITDA are used to
                   estimate current or prospective
                   enterprise value. EBITDA does not
                   give effect to cash used for debt
                   service requirements, and thus
                   does not reflect funds available
                   for investment or other
                   discretionary uses. EBITDA as
                   presented herein may not be
                   comparable to similarly titled
                   measures reported by other
                   companies.

SOURCE General Communication, Inc.


Source: PR Newswire