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Nobody Shops at the Wiz, Cablevision Reports

Digital cable subscriber growth slows as well, punishing the stock.



posted weak fourth-quarter earnings Thursday, pushing its shares lower.

For the quarter ended Dec. 31, the New York area cable operator and entertainment company posted adjusted operating cash flow of $231.7 million, down 3% from a year ago. The company attributed the decline to higher losses at its The Wiz electronics retail chain, expenses related to its rollout of digital video on its cable systems, and lower attendance at holiday shows related to the poor recent tourism market in New York City.

Cablevision's shares fell $1.91, or 4.9%, to $37.15 at midday Thursday.

The company, which has 3 million subscribers to its basic cable service, signed up only 17,200 customers for its new Interactive Optimum digital video service in the quarter, well below last year's guidance of 40,000 to 50,000 subscribers. In October,

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reported that rollout glitches in the new service, as well as subscribers' perception of high prices,

put the company's sales targets for the new service at risk.

Meanwhile, sales at The Wiz fell 3.7% on a year-over-year basis to $217.6 million for the fourth quarter. The adjusted operating cash flow deficit for The Wiz amounted to $27.4 million in the fourth quarter, compared to a $6.7 million loss one year earlier. The fourth quarter 2001 loss stemmed primarily from a $17 million inventory writedown.

Cablevision's operating cash flow -- operating profit before depreciation and amortization -- is adjusted to exclude charges related to a restructuring announced last year and the effects of long-term incentives and stock plans.

On the bottom line, the company reported a net loss of $1.57 per share, or $281.6 million, compared to a profit of $3.29 per share, or $556.6 million, in the fourth quarter of 2000, when the company reported a $1.1 billion asset sale.