Charter 2002 Annual Report Download - page 36

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Net Loss. Net loss increased by $309 million, or 36%, from $858 million in 2000 to $1.2 billion in 2001
as a result of the combination of factors described above, including the acquisition of AT&T Broadband and
the increase in depreciation expense as a result of our capital expenditures.
Preferred Stock Dividends. Charter Communications, Inc. issued 505,664 shares of Series A Converti-
ble Redeemable Preferred Stock in connection with the Cable USA acquisition in August 2001, on which it
pays a quarterly cumulative cash dividends at an annual rate of 5.75% on a liquidation preference of $100 per
share.
Loss Per Common Share. The loss per common share increased by $0.53, or 14%, from $3.80 per
common share for the year ended December 31, 2000 to $4.33 per common share for the year ended
December 31, 2001 as a result of the factors described above, partially oÅset by an increase in weighted
average shares outstanding due to the issuance of 60,247,350 shares of common stock in May 2001.
Liquidity and Capital Resources
Introduction
This section contains a discussion of our liquidity and capital resources, including a discussion of our cash
position, sources and uses of cash, access to debt facilities and other Ñnancing sources, historical Ñnancing
activities, cash needs, capital expenditures and outstanding debt. The Ñrst part of this section, entitled
""Overview'' provides an overview of these topics. The second part of this section, entitled ""Historical
Operating, Financing and Investing Activities'' provides information regarding the cash provided from or used
in our operating, Ñnancing and investing activities during the years 2000 through 2002. The third part of this
section, entitled ""Capital Expenditures'' provides more detailed information regarding our historical capital
expenditures and our planned capital expenditures going forward. The fourth part of this section, entitled
""Description of Our Outstanding Debt'' describes our outstanding debt in greater detail, including a summary
of scheduled maturities. The Ñfth part of this section, entitled ""Credit Facility Terms, Restrictions and
Covenants'', summarizes the principal terms, covenants and restrictions governing the credit facilities of our
subsidiaries. The sixth part of this section, entitled ""Indenture Restrictions and Covenants'' summarizes
certain of the covenants and restrictions governing our outstanding notes. The last part of this section, entitled
""Funding Commitment of Vulcan Inc.'', summarizes the terms of a credit commitment made by Vulcan Inc.
in favor of certain of our subsidiaries. For further discussion of certain trends with respect to our liquidity and
capital resources, see the section below entitled ""Certain Trends and Uncertainties.''
Overview
Our business requires signiÑcant cash to fund capital expenditures, debt service costs and ongoing
operations. We have historically funded liquidity and capital requirements through cash Öows from operations,
borrowings under the credit facilities of our subsidiaries, issuances of debt securities by us and our subsidiaries
and our issuances of equity securities. The mix of funding sources changes from period to period, but for the
year ended December 31, 2002, approximately 70% of our funding requirements were from cash Öows from
operations, 16% was from borrowings under the credit facilities of our subsidiaries and 14% was from issuance
of debt by our subsidiaries. We expect that our mix of sources of funds will continue to change in the future
based on our overall capital needs relative to our cash Öow and on the availability under the credit facilities of
our subsidiaries, our access to the bond and equity markets and our ability to generate free cash Öows.
We believe that as a result of our signiÑcant level of debt, current market conditions and recent
downgrades to our debt securities, we have limited access to the debt and equity markets at this time.
Accordingly, during 2003, we expect to fund our liquidity and capital requirements principally through cash on
hand, cash Öow from operations, and through borrowings under the credit facilities of our subsidiaries and the
Vulcan Inc. commitment described below in ""Ì Funding Commitment of Vulcan Inc.'' As of December 31,
2002, we held $321 million in cash and cash equivalents and we had total potential unused availability of
$1.4 billion under the credit facilities of our subsidiaries, although the actual availability at that time was only
$944 million because of limits imposed under covenant restrictions. However, continued access to these credit
facilities is subject to our remaining in compliance with the applicable covenants of these credit facilities.
34