Time Warner Cable Reports 2012 Third-Quarter Results

About Time Warner Cable

Time Warner Cable Inc. (NYSE:TWC) is among the largest providers of video, high-speed data and voice services in the United States, connecting more than 15 million customers to entertainment, information and each other. Time Warner Cable Business Class offers data, video and voice services to businesses of all sizes, cell tower backhaul services to wireless carriers and, through its NaviSite subsidiary, managed and outsourced information technology solutions and cloud services. Time Warner Cable Media, the advertising arm of Time Warner Cable, offers national, regional and local companies innovative advertising solutions. More information about the services of Time Warner Cable is available at www.twc.com, www.twcbc.com, www.navisite.com, and www.twcmedia.com.

Additional details on financial and subscriber metrics are included in the Trending Schedules and Presentation Slides posted on the Company’s Investor Relations website at www.twc.com/investors.

Information on Conference Call

Time Warner Cable’s earnings conference call can be heard live at 8:30 am ET on Monday, November 5, 2012. To listen to the call, visit www.twc.com/investors .

Caution Concerning Forward-Looking Statements

This document includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations or beliefs, and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements herein due to changes in economic, business, competitive, technological, strategic and/or regulatory factors, and other factors affecting the operations of Time Warner Cable Inc. More detailed information about these factors may be found in filings by Time Warner Cable Inc. with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Time Warner Cable is under no obligation to, and expressly disclaims any such obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.

TIME WARNER CABLE INC.
CONSOLIDATED BALANCE SHEET
(Unaudited)
																	September 30,				December 31,
																	2012				2011
																	(in millions)
ASSETS
Current assets:
	Cash and equivalents																$	3,853			$	5,177
	Receivables, less allowances of $82 million and $62 million as of September 30, 2012 and December 31, 2011, respectively																	899				767
	Deferred income tax assets																	372				267
	Other current assets																	238				187
Total current assets																		5,362				6,398
Investments																		88				774
Property, plant and equipment, net																		14,510				13,905
Intangible assets subject to amortization, net																		666				228
Intangible assets not subject to amortization																		26,011				24,272
Goodwill																		2,893				2,247
Other assets																		555				452
Total assets																	$	50,085			$	48,276
LIABILITIES AND EQUITY
Current liabilities:
	Accounts payable																$	458			$	545
	Deferred revenue and subscriber-related liabilities																	191				169
	Accrued programming expense																	875				807
	Current maturities of long-term debt																	1,876				2,122
	Mandatorily redeemable preferred equity issued by a subsidiary																	300				—
	Other current liabilities																	1,834				1,727
Total current liabilities																		5,534				5,370
Long-term debt																		25,187				24,320
Mandatorily redeemable preferred equity issued by a subsidiary																		—				300
Deferred income tax liabilities, net																		11,262				10,198
Other liabilities																		485				551
TWC shareholders’ equity:
	Common stock, $0.01 par value, 303.3 million and 315.0 million shares issued and outstanding as of September 30, 2012 and December 31, 2011, respectively																	3				3
	Additional paid-in capital																	7,707				8,018
	Retained earnings																	440				68
	Accumulated other comprehensive loss, net																	(541	)			(559	)
Total TWC shareholders’ equity																		7,609				7,530
Noncontrolling interests																		8				7
Total equity																		7,617				7,537
Total liabilities and equity																	$	50,085			$	48,276

See accompanying notes.

TIME WARNER CABLE INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
												Three Months Ended								Nine Months Ended
												September 30,								September 30,
												2012				2011				2012				2011
												(in millions, except per share data)
Revenues												$	5,363			$	4,911			$	15,901			$	14,682
Costs and expenses:
	Costs of revenues (a)												2,499				2,286				7,377				6,855
	Selling, general and administrative (a)												918				843				2,694				2,490
	Depreciation												789				750				2,377				2,238
	Amortization												31				9				79				23
	Merger-related and restructuring costs												32				21				98				36
Total costs and expenses													4,269				3,909				12,625				11,642
Operating Income													1,094				1,002				3,276				3,040
Interest expense, net													(402	)			(383	)			(1,204	)			(1,112	)
Other income (expense), net													496				(22	)			493				(84	)
Income before income taxes													1,188				597				2,565				1,844
Income tax provision													(379	)			(241	)			(920	)			(741	)
Net income													809				356				1,645				1,103
Less: Net income attributable to noncontrolling interests													(1	)			—				(3	)			(2	)
Net income attributable to TWC shareholders												$	808			$	356			$	1,642			$	1,101
Net income per common share attributable to TWC common shareholders:
	Basic											$	2.64			$	1.09			$	5.27			$	3.28
	Diluted											$	2.60			$	1.08			$	5.22			$	3.24
Average common shares outstanding:
	Basic												305.7				323.8				310.2				333.7
	Diluted												310.2				329.1				314.8				339.4
Cash dividends declared per share of common stock												$	0.56			$	0.48			$	1.68			$	1.44
(a)  Costs of revenues and selling, general and administrative expenses exclude depreciation.

See accompanying notes.

TIME WARNER CABLE INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
																		Nine Months Ended
																		September 30,
																		2012				2011
																		(in millions)
OPERATING ACTIVITIES
Net income																		$	1,645			$	1,103
Adjustments for noncash and nonoperating items:
	Depreciation																		2,377				2,238
	Amortization																		79				23
	Pretax gain on sale of investment in Clearwire																		(64	)			—
	(Income) loss from equity-method investments, net of cash distributions																		(433	)			98
	Deferred income taxes																		409				575
	Equity-based compensation expense																		104				88
	Excess tax benefit from equity-based compensation																		(73	)			(46	)
Changes in operating assets and liabilities, net of acquisitions and dispositions:
	Receivables																		(31	)			34
	Accounts payable and other liabilities																		105				8
	Other changes																		(3	)			223
Cash provided by operating activities																			4,115				4,344
INVESTING ACTIVITIES
Acquisitions and investments, net of cash acquired and distributions received																			(1,426	)			(333	)
Proceeds from SpectrumCo’s sale of spectrum licenses																			1,112				—
Capital expenditures																			(2,191	)			(1,995	)
Other investing activities																			23				21
Cash used by investing activities																			(2,482	)			(2,307	)
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt																			2,258				3,227
Repayments of long-term debt																			(1,750	)			—
Repayments of long-term debt assumed in acquisitions																			(1,730	)			(44	)
Debt issuance costs																			(25	)			(24	)
Proceeds from exercise of stock options																			124				109
Taxes paid in cash in lieu of shares issued for equity-based compensation																			(43	)			(29	)
Excess tax benefit from equity-based compensation																			73				46
Dividends paid																			(529	)			(488	)
Repurchases of common stock																			(1,287	)			(2,291	)
Other financing activities																			(48	)			(17	)
Cash provided (used) by financing activities																			(2,957	)			489
Increase (decrease) in cash and equivalents																			(1,324	)			2,526
Cash and equivalents at beginning of period																			5,177				3,047
Cash and equivalents at end of period																		$	3,853			$	5,573

See accompanying notes.

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