tw telecom Reports Fourth Quarter and Full Year 2010 Results -- Grew revenue 5.1% for 2010 versus 4.5% for 2009 --

-- Achieved a 36.4% M-EBITDA margin for 2010, an expansion of 40 basis points --

-- Delivered strong Levered Free Cash Flow --

LITTLETON, Colo., Feb. 7, 2011 – tw telecom inc. (Nasdaq: TWTC), a leading provider of managed voice, Internet and data networking solutions for business customers, today announced its fourth quarter 2010 financial results, including $324.8 million of revenue, $119.4 million of Modified EBITDA(1) ("M-EBITDA"), $26.4 million of levered free cash flow(3) and net income of $17.5 million.  For the year, the Company reported $1.273 billion in revenue, $463.6 million of M-EBITDA, $82.8 million of levered free cash flow, and net income of $271.4 million, which includes a non-cash tax benefit of $227.3 million.

(Logo:  http://photos.prnewswire.com/prnh/20080626/LATH527LOGO)

"We achieved strong financial results and great operational execution in 2010," said Larissa Herda, tw telecom's Chairman, CEO and President.  "We grew our revenue, expanded our M-EBITDA margin, substantially increased net income, and generated strong cash flow.  At the same time we strategically invested in the business to advance our network capabilities, deliver new product features and reach more customer locations.  Our focus in 2011 includes continued network and product initiatives, increased sales productivity and ongoing dedication to customer service to increase our capabilities, take market share, and increase the pace of our revenue growth."

Highlights for the Year – 2010 compared to 2009  

  • Grew bookings(4), or sales 17.8%  
  • Grew annual fiber-connected(6) building additions by 49.1%
  • Launched new product initiatives
  • Reduced revenue churn for the year to 1.0% from 1.3%
  • Grew total revenue 5.1% year over year and enterprise revenue 6.3%  
  • Grew data and Internet revenue 15.8%, driven largely by a 28.2% increase in Ethernet and managed VPN services
  • Grew M-EBITDA by 6.2% to $463.6 million
  • Achieved a 36.4% M-EBITDA margin, a 40 basis point improvement
  • Achieved $1.80 annual basic EPS.  Excluding a non-cash tax benefit and debt extinguishment costs, EPS was $0.41 which grew $0.22 or 115.8% over 2009
  • Delivered $82.8 million of levered free cash flow, representing 6.5% of revenue
  • Returned $50 million to shareholders in the form of share repurchases
  • Refinanced approximately two-thirds of debt, extending maturities at favorable market rates

Business Trends

"We performed well in 2010, financially, operationally, and strategically," said Mark Peters, tw telecom's Executive Vice President and Chief Financial Officer.  "For the year, we delivered strong financial results as we transitioned to a higher level of growth.  We expanded our already strong M-EBITDA margin another 40 basis points in 2010, outpacing incremental costs for growing our sales resources, supporting new products, and expanding our network reach.  We also continued to leverage our capital allocation strategy to invest in the business through network, product and success-based initiatives as well as opportunistic share repurchases.  In 2011, we expect to continue to invest in the business as we pursue growth initiatives.  Our customers, network capabilities and product initiatives will all remain top priorities."

Operational Metrics

Revenue churn(5) was 1.0% for the current quarter, 1.1% for the prior quarter, and 1.2% for the same quarter last year.  As a component of revenue churn, revenue lost from customers fully disconnecting service was 0.2% for the current quarter and 0.3% for both the prior quarter and the same quarter last year, indicative of a loyal customer base, strong customer experience strategy and competitive product portfolio.  Revenue churn for the year improved to 1.0% from 1.3% in 2009.

The Company had nearly 27,300 customers as of December 31, 2010.  Customer churn(5) was 1.1% for the current quarter, 1.0% for the prior quarter and 1.2% for the same period last year.  

The Company ended the fourth quarter with approximately 28,400 fiber route miles (including nearly 22,000 metro miles), 11,876 fiber connected on-net buildings and 2,975 employees, including 555 sales associates.

Other Trends

The Company continues to expect business fluctuations to impact sequential trends in revenue, margins and cash flow.  This includes the timing, as well as any seasonal nature of sales and installations(8), usage, disputes, repricing for contract renewals and fluctuations in revenue churn, expenses and capital expenditures.  

The Company expects the first quarter of 2011 may be impacted by historical trends, including seasonal revenue fluctuations and cost increases.  Due to the resetting of payroll taxes and other employee-related expenses, the Company anticipates approximately a $3 million sequential cost increase in the first quarter of 2011.

In 2010, the Company reversed a previously established valuation allowance for its deferred tax assets.  As a result of the allowance reversal, the Company expects to record tax expense at an effective tax rate for book purposes of approximately 45% in 2011.  Due to its net operating loss tax carry forwards and bonus depreciation, the Company expects that cash taxes will not be materially different in 2011 from 2010.

Capital Expenditures

Capital expenditures were $78.1 million for the quarter compared to $77.8 million for the prior quarter and $72.3 million for the same period last year.  For the quarter, both the sequential and year over year increase primarily reflects success-based capital initiatives, somewhat offset sequentially for the timing of corporate and IT initiatives.  For the year, capital investments were $321.8 million compared to $274.9 million in 2009, reflecting increased investing in success-based opportunities and increased new product, corporate and technology initiatives.

The Company expects capital investments for 2011 to be approximately $310 to $330 million.  The Company expects the majority of the full year capital investments to be tied to new sales opportunities.

Year over Year Results – Fourth Quarter 2010 compared to Fourth Quarter 2009

Revenue

Revenue for the quarter was $324.8 million compared to $307.9 million for the fourth quarter last year, representing a year over year increase of $16.9 million, or 5.5%.  Key changes in revenue included:

  • $15.3 million increase in revenue from enterprise customers, or 6.7% year over year driven primarily by data and Internet services
  • $3.0 million increase in revenue from carriers, primarily due to an increase in revenue from wireless providers, which outpaced churn and a decline in usage-based services
  • $1.5 million decrease in intercarrier compensation related primarily to fluctuations in disputes and volume

By product line, the percentage change in revenue year over year was as follows:

  • 16.3% increase for data and Internet services, primarily due to continued success with Ethernet and IP-based product sales
  • 1.2% decrease in voice services, primarily reflecting churn and a reduction in usage-based services which outpaced new sales
  • 1.1% decrease for network services, primarily reflecting growth in high capacity and collocation services, as well as increased services to wireless providers, outpaced by churn

M-EBITDA and Margins  

M-EBITDA grew to $119.4 million for the quarter, an increase of 4.8%, or $5.5 million from the same period last year.  The growth in M-EBITDA represents the contribution from revenue growth and network cost efficiencies, partially offset by an increase in employee expenses.

Operating costs for the quarter increased year over year, primarily due to increased network access costs associated with higher revenue, partially offset by network cost efficiencies.  Operating costs as a percent of revenue were 41.4% for the quarter and 42.2% for the same period last year.

Selling, general and administrative costs ("SG&A") increased year over year, primarily reflecting an increase in employee costs, including increased commissions due to higher installations as well as increased sales headcount.   SG&A costs as a percent of revenue were 24.0% for the quarter and 23.2% for the same period last year.

Modified gross margin(7) was 58.9% for the quarter compared to 58.2% for the same period last year, an increase of 70 basis points.  M-EBITDA margin for the quarter was 36.7% as compared to 37.0% for the same period last year, a 30 basis point reduction.  

The Company utilizes a fully burdened modified gross margin, including network costs, and personnel costs for customer care, provisioning, network maintenance, technical field and network operations, excluding non-cash stock-based compensation expense.  

Net Income

For the quarter, net income was $17.5 million compared to net income of $11.1 million for the same period last year.  The 57.7% increase in net income reflected strong M-EBITDA growth and a decrease in depreciation expense somewhat offset by an increase in income tax expense.  

Sequential Results – Fourth Quarter 2010 compared to Third Quarter 2010

Revenue

Revenue for the quarter was $324.8 million, as compared to $320.3 million for the third quarter of 2010, an increase of $4.5 million, or 1.4%.  Key changes in revenue included:

  • $3.6 million increase in enterprise revenue, representing 1.4% sequential growth driven primarily by data and Internet services
  • $1.0 million increase in revenue from carrier customers, primarily from wireless providers, which outpaced churn

By product line, the percentage change in revenue sequentially was as follows:

  • 4.5% increase for data and Internet services, primarily due to continued success with Ethernet and IP-based product sales
  • 1.3% decrease in voice services, primarily reflecting churn and a reduction in usage-based services, which outpaced new sales
  • 0.8% decrease in network services due to churn, which outpaced new sales

M-EBITDA and Margins  

M-EBITDA was $119.4 million for the quarter, compared to $115.5 million for the prior quarter, an increase of $3.8 million or 3.3%.  The growth in M-EBITDA represents contribution from revenue growth and improvement in bad debt expense, partially offset by higher employee costs.

Operating costs increased primarily reflecting increased access costs associated with the growth in revenue and higher employee-related expenses, partially offset by network cost efficiencies and seasonally lower utility costs.  Operating costs were 41.4% of revenue for the quarter and 41.6% for the prior quarter.  

SG&A costs were slightly down, primarily reflecting a reduction in bad debt expense. SG&A was 24.0% of revenue for the quarter and 24.5% for the prior quarter.  

Modified gross margin was 58.9% for the quarter compared to 58.7% for the prior quarter, an increase of 20 basis points.  M-EBITDA margin was 36.7% for the quarter compared to 36.1% for the prior quarter, an increase of 60 basis points primarily as a result of improved bad debt expense.

Net Income

For the quarter, the Company reported net income of $17.5 million compared to $16.1 million for the prior quarter.  The 8.8% sequential increase in net income reflected M-EBITDA growth offset by an increase in depreciation expense and interest expense.  

Summary  

"We exited 2010 with strong results, ongoing customer opportunities and momentum from our strategic initiatives that position us well for revenue growth, strong M-EBITDA margins and continued cash generation for 2011," said Herda.

tw telecom plans to conduct a webcast conference call to discuss its earnings results on February 8, 2011 at 9:00 a.m. MST (11:00 a.m. EST).  To access the webcast and the financial and other information to be discussed in the webcast, visit www.twtelecom.com under "Investor Relations."

(1) The Company uses a modified definition of EBITDA to eliminate certain non-cash and non-operating income or charges to earnings to enhance the comparability of its financial performance from period to period.  Modified EBITDA (or "M-EBITDA") is defined as net income or loss before depreciation, amortization, accretion, impairment charges and other income and losses, interest expense, debt extinguishment costs, interest income, income tax expense or benefit, cumulative effect of change in accounting principle, and non-cash stock-based compensation expense.

(2) The Company defines unlevered free cash flow as Modified EBITDA less capital expenditures. Unlevered free cash flow is reconciled to Net Cash provided by (used in) operating activities in the supplemental information posted on the Company's website.

(3) The Company defines levered free cash flow as Modified EBITDA less capital expenditures and net interest expense from operations (but excludes debt extinguishment costs, non-cash interest expense and deferred debt costs).  Levered free cash flow is reconciled to Net Cash provided by (used in) operating activities in the supplemental information posted on the Company's website.  

(4) Bookings reflect signed customer sales.  The timing of when these sales are installed and recognized as revenue varies based on the underlying contract.

(5) The Company defines revenue churn as the lost recurring monthly billing for the period from a customer's partial or complete disconnection of services (excluding repricing impacts and usage) compared to reported revenue for the period.  Customer churn is defined as the average monthly customer turnover for the period compared to the average monthly customer count for the period.

(6) Fiber connected buildings on-net represent locations to which the Company's fiber is directly connected with lit electronics.  This does not include buildings which are exclusively Local Serving Office locations or buildings with fiber but no lit electronics.

(7) The Company defines modified gross margin as total revenue less operating costs excluding non-cash stock-based compensation expense.  Modified gross margin is reconciled to gross margin in the financial tables.

(8) Installations reflect services from signed customer sales that are installed and recognized as revenue from the date of installation.  

Financial Measures

The Company provides financial measures using U.S. generally accepted accounting principles ("GAAP") as well as adjustments to GAAP measures to describe its business trends, including Modified EBITDA.  Management believes that its definition of Modified EBITDA (see above) is a standard measure of operating performance and liquidity that is commonly reported and widely used by analysts, investors, and other interested parties in the telecommunications industry because it eliminates many differences in financial, capitalization, and tax structures, as well as non-cash and non-operating income or charges to earnings.  Modified EBITDA is not intended to replace operating income (loss), net income (loss), cash flow, and other measures of financial performance and liquidity reported in accordance with GAAP.  Management uses Modified EBITDA internally to assess on-going operations and it is the basis for various financial covenants contained in the Company's debt agreements and for operating performance and liquidity.  Modified EBITDA is reconciled to Net Income (Loss), the most comparable GAAP measure for operating performance within the Consolidated Operations Highlights and in the supplemental information posted on the Company's website.  Modified EBITDA, as a measure of liquidity, is also reconciled to Net Cash provided by operating activities on the Company's website.

In addition, management uses unlevered and levered free cash flow, which measure the ability of M-EBITDA to cover capital expenditures.  The Company uses these cash flow definitions to eliminate certain non-cash costs.  Levered and unlevered free cash flow are reconciled to Net Cash provided by operating activities and also to Modified EBITDA in the supplemental information posted on the Company's website.  The Company also provides an adjustment to the measure gross margin by eliminating the impact of non-cash stock-based compensation expense.  Management uses modified gross margin internally to assess on-going operations.  Modified gross margin is reconciled to gross margin in the financial tables.

Forward Looking Statements

The statements in this press release and related conference call concerning the outlook for 2010 and beyond, including product plans, growth prospects, market opportunities, bookings, sales momentum, operational improvements, sales and installations timing, demand, revenue growth, service disconnections, churn, business trends and fluctuations, seasonality, and expected capital expenditures are forward-looking statements that reflect management's views with respect to future events and financial performance.  These statements are based on management's current expectations and are subject to risks and uncertainties.  Important factors that could cause actual results to differ materially from those in the forward looking statements include the risks disclosed in the Company's SEC filings, especially the section entitled "Risk Factors" in its 2009 Annual Report on Form 10-K and in its quarterly report on Form 10-Q for the quarter ended September 30, 2010.  tw telecom undertakes no obligations to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About tw telecom

tw telecom, headquartered in Littleton, Colo., provides managed network services, specializing in converged services, Ethernet and data networking, Internet access, local and long distance voice, VPN, VoIP and network security, to enterprise organizations and communications services companies throughout the U.S. including their global locations.  As a leading provider of integrated and converged network solutions, tw telecom delivers customers overall economic value, quality service, and improved business productivity.  For more information please visit www.twtelecom.com.  

tw telecom inc.

Consolidated Operations Highlights

(Dollars in thousands)

Unaudited (1)

















Three Months Ended


Twelve Months Ended






December 31,



December 31,





2010

2009

Growth %


2010

2009


Growth %













Revenue










Data and Internet services

$145,107

$124,799

16%


$547,218

$472,647


16%


Network services

89,470

90,463

-1%


359,169

370,859


-3%


Voice services

81,891

82,860

-1%


332,870

333,274


0%



Service Revenue

316,468

298,122

6%


1,239,257

1,176,780


5%


Intercarrier compensation

8,349

9,812

-15%


33,914

34,610


-2%




Total Revenue

324,817

307,934

5%


1,273,171

1,211,390


5%













Expenses










Operating costs

134,554

129,855



528,965

503,960






Gross Margin

190,263

178,079



744,206

707,430




Selling, general and administrative costs

78,106

71,355



308,470

297,290




Depreciation, amortization, and accretion

72,534

74,290



289,564

296,167






Operating Income

39,623

32,434



146,172

113,973




Interest expense

(15,057)

(15,815)



(59,535)

(64,583)




Debt extinguishment costs

-

-



(17,070)

-




Non cash interest expense and deferred debt costs

(5,571)

(4,969)



(21,417)

(19,418)




Other income

-

-



825

-




Interest income

170

33



608

360






Income before income taxes

19,165

11,683



49,583

30,332




Income tax expense (benefit) (2)

1,671

587



(221,851)

2,746






Net Income

$17,494

$11,096



$271,434

$27,586



























SUPPLEMENTAL INFORMATION TO RECONCILE MODIFIED GROSS MARGIN AND MODIFIED EBITDA














Gross Margin

$190,263

$178,079



$744,206

$707,430




Add back non-cash stock-based compensation expense

929

1,190



3,261

3,654






Modified Gross Margin

191,192

179,269

7%


747,467

711,084


5%














Selling, general and administrative costs

78,106

71,355



308,470

297,290




Add back non-cash stock-based compensation expense

6,270

5,953



24,571

22,864






Modified EBITDA

119,356

113,867

5%


463,568

436,658


6%














Non-cash stock-based compensation expense

7,199

7,143



27,832

26,518




Depreciation, amortization, and accretion

72,534

74,290



289,564

296,167




Net Interest expense

14,887

15,782



58,927

64,223




Debt extinguishment costs

-

-



17,070

-




Non cash interest expense and deferred debt costs

5,571

4,969



21,417

19,418




Other income

-

-



825

-




Income tax expense (benefit)

1,671

587



(221,851)

2,746






Net Income

$17,494

$11,096



$271,434

$27,586
















Modified Gross Margin %

58.9%

58.2%



58.7%

58.7%
















Modified EBITDA Margin %

36.7%

37.0%



36.4%

36.0%



























Free Cash Flow:










Modified EBITDA

$119,356

$113,867

5%


$463,568

$436,658


6%


Less: Capital Expenditures

78,118

72,347

8%


321,844

274,890


17%


Unlevered Free Cash Flow

41,238

41,520

-1%


141,724

161,768


-12%


Less: Net interest expense

14,887

15,782

-6%


58,927

64,223


-8%


Levered Free Cash Flow

$26,351

$25,738

2%


$82,797

$97,545


-15%

























(1) For complete financials and related footnotes, please refer to the Company's SEC filings.

(2) Includes a non-cash income tax benefit of $227.3 million in the twelve months ended December 31, 2010 to recognize the value of tax assets.



tw telecom inc.

Consolidated Operations Highlights

(Dollars in thousands)

Unaudited (1)













Three Months Ended





Dec 31,

Sept 30,







2010

2010


Growth %









Revenue






Data and Internet services

$145,107

$138,838


5%


Network services

89,470

90,151


-1%


Voice services

81,891

82,944


-1%



Service Revenue

316,468

311,933


1%


Intercarrier compensation

8,349

8,361


0%




Total Revenue

324,817

320,294


1%









Expenses






Operating costs

134,554

133,237






Gross Margin

190,263

187,057




Selling, general and administrative costs

78,106

78,452




Depreciation, amortization, and accretion

72,534

71,612






Operating Income

39,623

36,993




Interest expense

(15,057)

(14,180)




Non cash interest expense and deferred debt costs

(5,571)

(5,454)




Other income

-

825




Interest income

170

209






Income before income taxes

19,165

18,393




Income tax expense

1,671

2,314






Net Income

$17,494

$16,079



















SUPPLEMENTAL INFORMATION TO RECONCILE MODIFIED GROSS MARGIN AND MODIFIED EBITDA










Gross Margin

$190,263

$187,057




Add back non-cash stock-based compensation expense

929

825






Modified Gross Margin

191,192

187,882


2%










Selling, general and administrative costs

78,106

78,452




Add back non-cash stock-based compensation expense

6,270

6,102






Modified EBITDA

119,356

115,532


3%










Non-cash stock-based compensation expense

7,199

6,927




Depreciation, amortization, and accretion

72,534

71,612




Net Interest expense

14,887

13,971




Non cash interest expense and deferred debt costs

5,571

5,454




Other income

-

825




Income tax expense

1,671

2,314






Net Income

$17,494

$16,079












Modified Gross Margin %

58.9%

58.7%












Modified EBITDA Margin %

36.7%

36.1%



















Free Cash Flow






Modified EBITDA

$119,356

$115,532


3%


Less: Capital Expenditures

78,118

77,809


0%


Unlevered Free Cash Flow

41,238

37,723


9%


Less: Net interest expense

14,887

13,971


7%


Levered Free Cash Flow

$26,351

$23,752


11%

















(1) For complete financials and related footnotes, please refer to the Company's SEC filings.



tw telecom inc.

Highlights of Results Per Share

Unaudited (1) (2)




























Three Months Ended


Twelve Months Ended




12/31/10


9/30/10


12/31/09


12/31/10


12/31/09













Weighted Average Shares Outstanding (thousands)























Basic

148,267


149,374


148,439


149,156


148,087














Diluted (2)

150,490


151,698


151,372


171,456


149,852













Basic Income per Common Share











Prior to impacts of debt extinguishment & recognition of the value of tax assets

$0.12


$0.11


$0.07


$0.41


$0.19


Debt extinguishment costs

-


-


-


(0.11)


-


Recognition of the value of tax assets

-


-


-


1.50


-



Total

$0.12


$0.11


$0.07


$1.80


$0.19













Diluted Income per Common Share

$0.11


$0.10


$0.07


$1.72


$0.18






























As of










12/31/10


9/30/10


12/31/09





Common shares (thousands)























Actual Shares Outstanding

149,246


151,290


150,123

















Unvested Restricted Stock Units










and Restricted Stock Awards (thousands)

3,162


3,444


2,296

















Options (thousands)























Options Outstanding

9,154


9,490


11,035


















Options Exercisable

6,051


5,983


6,922


















Options Exercisable and In-the-Money

2,417


3,410


2,639





























(1) For complete financials and related footnotes, please refer to the Company's SEC filings.

(2) Stock options, restricted stock units/awards and convertible debt subject to conversion, are excluded from the computation of diluted weighted average shares outstanding if inclusion would be anti-dilutive. See the Company's SEC filings for more details.



tw telecom inc.

Condensed Consolidated Balance Sheet Highlights

(Dollars in thousands)

Unaudited (1)


























Dec 31,


Sept 30,


Dec 31,






2010


2010


2009











ASSETS

















Cash, equivalents, and short term investments

$475,594


$507,458


$470,772












Receivables

89,496


88,779


87,465



Less: allowance

(7,898)


(8,703)


(9,449)




Net receivables

81,598


80,076


78,016












Other current assets

59,368


110,259


43,120












Property, plant and equipment

3,732,050


3,690,547


3,481,287



Less:  accumulated depreciation

(2,375,438)


(2,346,622)


(2,186,915)




Net property, plant and equipment

1,356,612


1,343,925


1,294,372












Other Assets

695,990


649,532


487,920















Total

$2,669,162


$2,691,250


$2,374,200





















LIABILITIES AND STOCKHOLDERS' EQUITY

















Current Liabilities








Accounts payable

$53,436


$67,988


$51,088



Deferred revenue

37,888


36,889


34,005



Accrued taxes, franchise and other fees

68,663


67,801


68,669



Accrued interest

15,208


7,447


16,219



Accrued payroll and benefits

41,772


48,464


42,589



Accrued carrier costs

35,049


31,979


35,890



Current portion of debt and lease obligations

7,202


7,119


7,569



Other current liabilities

42,570


42,441


39,120




Total current liabilities

301,788


310,128


295,149












Long-Term Debt and Capital Lease Obligations








2 3/8% convertible senior debentures, due 4/1/2026

373,744


373,744


373,750



Unamortized Discount

(46,732)


(51,395)


(64,808)




Net

327,012


322,349


308,942



Floating rate senior secured debt - Term Loan B, due 1/7/2013

103,130


577,500


582,000



Floating rate senior secured debt - Term Loan B, due 12/30/2016

472,870


-


-



9 1/4% senior unsecured notes, due 2/15/2014

-


-


400,229



8% senior unsecured notes, due 3/1/2018

427,227


427,130


-



Capital lease obligations

15,260


15,617


16,768




Less: current portion

(7,202)


(7,119)


(7,569)




Total long-term debt and capital lease obligations

1,338,297


1,335,477


1,300,370












Long-Term Deferred Revenue

14,864


15,374


15,988


Other Long-Term Liabilities

29,364


31,271


30,653












Stockholders' Equity

984,849


999,000


732,040















Total

$2,669,162


$2,691,250


$2,374,200





















(1) For complete financials and related footnotes, please refer to the Company's SEC filings.



tw telecom inc.

Condensed Consolidated Statements of Cash Flows

(Dollars in thousands)

Unaudited (1)




















Three Months Ended


Twelve Months Ended






Dec 31,


Sept 30,


Dec 31,


Dec 31,


Dec 31,






2010


2010


2009


2010


2009





























Cash flows from operating activities:











Net Income

$17,494


$16,079


$11,096


$271,434


$27,586


Adjustments to reconcile net income to











net cash provided by operating activities:












Depreciation, amortization, and accretion

72,534


71,612


74,290


289,564


296,167



Deferred income taxes

1,565


647


-


(224,085)


-



Stock-based compensation

7,200


6,926


7,143


27,832


26,518



Extinguishment costs, amortization of discount on debt and deferred debt costs and other

5,528


4,617


4,992


37,649


20,036


Changes in operating assets and liabilities:












Receivables, prepaid expense and other assets

3,205


(5,713)


(3,813)


(5,264)


1,972



Accounts payable, deferred revenue, and other liabilities

(17,346)


11,265


18,567


(11,378)


18,199


















Net cash provided by operating activities

90,180


105,433


112,275


385,752


390,478















Cash flows from investing activities:











Capital expenditures

(78,118)


(77,809)


(72,347)


(321,844)


(266,997)


Purchase of investments

(78,714)


(34,446)


(24,892)


(246,575)


(24,892)


Proceeds from redemptions of investments

61,337


70,086


-


154,786


-


Proceeds from sale of assets and other investing activities

2,098


(1,650)


386


(4,416)


1,300




Net cash used in investing activities

(93,397)


(43,819)


(96,853)


(418,049)


(290,589)















Cash flows from financing activities:











Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units

(1,153)


1,298


444


1,045


1,834


Purchases of treasury stock

(38,206)


(8,182)


-


(49,911)


-


Net (costs) proceeds from issuance of debt

(4,356)


-


-


413,069


-


Retirement of debt obligations

-


-


-


(413,683)


-


Payment of debt and capital lease obligations

(1,662)


(1,847)


(2,290)


(7,208)


(7,992)


















Net cash used in financing activities

(45,377)


(8,731)


(1,846)


(56,688)


(6,158)


















Increase (decrease) in cash and cash equivalents

(48,594)


52,883


13,576


(88,985)


93,731




Cash and cash equivalents at the beginning of the period

405,516


352,633


432,331


445,907


352,176




Cash and cash equivalents at the end of the period

$356,922


$405,516


$445,907


$356,922


$445,907















Supplemental disclosures cash, equivalents and short term investments













Cash and cash equivalents at the end of the period

$356,922


$405,516


$445,907


$356,922


$445,907




Short term investments

118,672


101,942


24,865


118,672


24,865





Total of cash, equivalents and short term investments

$475,594


$507,458


$470,772


$475,594


$470,772















Supplemental disclosures of cash flow information:











Cash paid for interest

$7,771


$19,928


$9,382


$63,169


$68,049


Cash paid for debt extinguishment costs

-


-


-


$13,677


-


Cash paid for income taxes, net of refunds

$701


$975


$175


$4,653


$3,001


Addition of capital lease obligation

-


-


-


-


$7,893





























Supplemental information to reconcile capital expenditures:













Capital expenditures per cash flow statement

$78,118


$77,809


$72,347


$321,844


$266,997




Addition of capital lease obligation

-


-


-


-


7,893




Total capital expenditures

$78,118


$77,809


$72,347


$321,844


$274,890





























(1) For complete financials and related footnotes, please refer to the Company's SEC filings.



tw telecom inc.

Selected Operating Statistics

Unaudited (1)

























































Three Months Ended





2009



2010





Mar. 31

Jun. 30

Sept. 30

Dec. 31


Mar. 31

Jun. 30

Sept. 30

Dec. 31














Operating Metrics:





































Buildings












Fiber connected buildings, on-net

9,685

9,934

10,170

10,407


10,647

10,967

11,347

11,876




























Headcount












Total Headcount

2,853

2,861

2,849

2,870


2,887

2,901

2,932

2,975



Sales Associates

486

494

503

522


523

528

545

555




























Customers













Total Customers

29,256

28,676

28,347

27,989


27,685

27,460

27,382

27,281




















(1) For complete financials and related footnotes, please refer to the Company's SEC filings.



SOURCE tw telecom inc.



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