On Command Announces First Quarter 2001 Results

Marriott Agreement, Digital Music Network Acquisition Lead Quarterly

Accomplishments



Note: On Command Corporation Chairman and CEO Jerome H. Kern will discuss

the company's first quarter 2001 performance in a conference call which will

begin at 4:30 p.m. EDT today. The call can be accessed by dialing

800-237-0767 in the United States and 203-790-0767 internationally at least

10 minutes prior to the start time. Replays of the conference call can be

accessed from 6:30 p.m. EDT on April 25, 2001 through 11:59 p.m. EDT

May 2, 2001 by dialing 877-710-5302 in the United States and 402-220-1605

internationally. The conference call also will be available online, accessible

by visiting On Command's Web site at http://www.oncommand.com .



Apr 25, 2001, 01:00 ET from On Command Corporation

    DENVER, April 25 /PRNewswire/ -- On Command Corporation (Nasdaq: ONCO),
 the leading provider of in-room interactive entertainment, Internet services,
 business information and guest services for the lodging industry, today
 announced first quarter 2001 revenues of  $62.2 million and adjusted EBITDA
 (earnings before interest, taxes, depreciation and amortization) for the first
 quarter of 2001 of $14.6 million.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20000718/SFTU067LOGO )
     The Q1 2001 EBITDA figure of $14.6 million, compared to Q4 2000 of
 $16.4 million, decreased primarily due to several reasons: higher costs of
 providing guest programming to hotels, and additional costs in personnel and
 infrastructure to support development of the company's technologies and
 content. The increase in selling, general and administrative (SG&A)
 costs -- both dollar amount and percentage of revenue -- was due, in part, to
 an increase in legal expenses, including a one-time charge of $500,000 related
 to a settlement between On Command and MagiNet Corporation.  It also was
 influenced by long-term company strategies to develop new product lines and
 revenue streams, improvement of customer service, and development of the
 Company's new lower-cost platforms for expansion into smaller hotels and other
 venues.
     The Company's EBITDA margin was 23.5 percent for the first quarter of
 2001, a decrease of approximately five percentage points from the same period
 a year ago, but consistent with a 24.9 percent EBITDA margin in the fourth
 quarter of 2000.  Less attractive movies available from studio distributors
 for Q1 2001 resulted in a decrease in movie revenues as compared to revenues
 from Q1 2000, which featured such Hollywood blockbusters as "American Beauty,"
 and "The Sixth Sense." Room revenues between Q4 2000 and Q1 2001 remained
 consistent with increases as projected in other room revenues, and a
 non-recurring decrease in equipment sales.
     "On Command's Q1 2001 EBITDA was $14.6 million, higher than our budgeted
 expectations for this period, while our EBITDA margin for Q1 2001 is
 23.5 percent. We anticipate this will grow substantially as the company
 continues to reduce costs and launch new products with higher profit margins,"
 said Kathryn Hale, On Command's chief financial officer.  "During this first
 quarter of 2001, we have developed the infrastructure necessary to deploy the
 most advanced technology available to our hotel partners. We project that in
 the second half of 2001 we will show higher levels of revenue and EBITDA
 growth as the upgrade of our hotel rooms continue at a faster pace and the
 Company continues to roll out new products and services."
     During Q1 2001, 35,200 Pacific-Asian rooms -- previously counted in the
 company's room number -- were transferred to the MagiNet partnership and are
 no longer included in the consolidated count currently at 946,000 rooms.
 Excluding the effect of the Asian-Pacific adjustment, On Command experienced a
 net growth of more than 3,600 rooms and added 26,000 TV-Internet systems to
 hotel rooms.
     "During this first quarter of 2001, On Command achieved significant
 progress in reaching corporate milestones. During this period, $1.5 million
 was spent to continue development of our next-generation technology for launch
 later this year," said Jerome H. Kern, On Command's chairman and CEO. "We are
 on track for new initiatives such as the expansion of short-form programming,
 now showing significant revenue growth, and we anticipate additional revenue
 streams from our advertising platform in the latter part of 2001. We also
 restructured our international holdings in Asia, while concurrently increasing
 our rate of installations and reducing installation costs."
 
     Significant milestones reached during the quarter include:
      -- The Company finalized its agreement with Marriott International to
 provide a specially modified version of its interactive television platform in
 more than 165,000 U.S. and Canadian hotel rooms managed by Marriott. On
 Command's services also will be available to 135,000 franchised Marriott hotel
 rooms in the United States and Canada. On Command remains on track to deploy
 its advanced, OCX platform to Marriott Hotel rooms at a record pace.
     -- Announcing its entry into interactive music content, On Command
 Corporation gained a controlling interest in Hotel Digital Music, Inc. also
 known as Digital Music Network (DMN), the programming and content leader in
 on-demand music systems. DMN will provide the content and back-end support for
 "Music OnCommand(TM)," a one-of-a-kind, interactive music service for hotels.
     -- The Company also began deploying ground-breaking short video,
 Internet-TV and interactive music content across its existing hotel base
 during this quarter, and has tracked significant gains in those revenue
 categories. In the category of short video, which includes the HBO series'
 "Sex and the City," and "The Sopranos," as well as exercise and sports videos,
 On Command revenues were $577K for Q1 2001, compared to $52K for Q1 2000, an
 increase of 381 percent. Second quarter 2001 is expected to show higher levels
 of revenue as the company rolls these products out at a faster pace.
 
     About On Command
     On Command Corporation (www.oncommand.com) is the leading provider of in-
 room interactive entertainment, Internet services, business information and
 guest services for the lodging industry and its guests. Based in Denver, with
 offices across the United States and around the world, On Command annually
 serves more than 250 million guests through nearly one million rooms in
 approximately 3,456 hotel properties. These hotel partners include more than
 100 of the most prestigious hotel chains and operators in the lodging
 industry: Adam's Mark Hotels & Resorts, Bass Hotels & Resorts (Inter-
 Continental, Crowne Plaza and Holiday Inn), Fairmont, Four Seasons, Hyatt,
 Loews, Marriott (Courtyard, Renaissance, Fairfield Inn and Residence Inn),
 Radisson, Ramada, Starwood Hotels & Resorts (Westin, Sheraton, W Hotels and
 Four Points), and Wyndham Hotels & Resorts. On Command is listed on the NASDAQ
 Stock Market under the symbol ONCO, and its warrants are traded under the
 symbols ONCOW and ONCOZ.
     Certain of the above statements, other than statements relating to the
 historical performance of On Command, constitute forward-looking statements
 within the meaning of the Private Securities Litigation Reform Act of 1995.
 Such forward-looking statements involve known and unknown risks,
 uncertainties, and other important factors that could cause the actual
 results, performance, or achievements of On Command, or industry results, to
 differ materially from future results, performance, or achievements expressed
 or implied by such forward-looking statements. Such risks, uncertainties and
 other factors include, among others: general economic and business conditions
 and industry trends; the regulatory and competitive environment of the
 industry in which On Command operates; uncertainties inherent in new business
 strategies; new product launches and development plans, including the future
 profitability of such added services and the large capital expenditures
 involved; rapid technological changes; the acquisition, development and/or
 financing of telecommunications networks and services; the development and
 provision of new services, including the customer acceptance and use rates;
 future financial performance, including availability, terms and deployment of
 capital; the ability of vendors to deliver required equipment, software and
 services; availability of qualified personnel; changes in the nature of key
 strategic relationships with hotel chains and their franchises, including the
 renewal of existing agreements on favorable terms; and competitor responses to
 On Command's products and services, and the overall market acceptance of such
 products and services. These factors are also discussed in On Command's
 filings with the Securities and Exchange Commission, including its recent
 filings on Form 10-K and Form 10-Q. These forward-looking statements (and such
 risks, uncertainties and other factors) speak only as of the date hereof, and
 On Command expressly disclaims any obligation or undertaking to disseminate
 any updates or revisions to any forward-looking statement contained herein, to
 reflect any change in On Command's expectations with regard thereto, or any
 other changes in events, conditions, or circumstances on which any such
 statement is based.
 
                             ON COMMAND CORPORATION
                Condensed Consolidated Statements of Operations
                    (In thousands, except per share amounts)
 
 
                                                       Three Months Ended
                                                      3/31/01        3/31/00
 
     REVENUES:
      Room revenues                                   $60,861        $62,386
      Video systems sales/other                         1,353          2,578
     TOTAL REVENUES                                    62,214         64,964
     DIRECT COSTS:
      Room                                             29,077         29,007
      Video system sales / other                          960          1,744
       Total Direct Costs                              30,037         30,751
     DIRECT PROFIT                                     32,177         34,213
     OPERATING EXPENSES:
      Operations                                        9,197          7,671
      Research and development                          1,467          2,107
      Selling, general & administration                 6,921          5,853
 
     TOTAL OPERATING EXPENSES                          17,585         15,631
     EBITDA                                            14,592         18,582
     Depreciation, amortization and
      stock based compensation                         21,265         19,749
     LOSS FROM OPERATIONS                              (6,673)        (1,167)
     Interest/Other expense, net                       (5,330)        (3,294)
     Legal Settlement / Other Asset Impairment         (3,785)             0
     Relocation Expense                                (3,347)             0
     LOSS BEFORE INCOME TAXES                         (19,135)        (4,461)
     Provision for (benefit from) income taxes             30            106
 
     NET LOSS                                        $(19,165)       $(4,567)
 
     Preferred Stock Dividend                          $ (129)           $--
 
     Net applicable to common stockholders           $(19,294)       $(4,567)
 
     Basic and diluted loss per share                  $(0.63)       $ (0.15)
 
     Shares used in basic and diluted
      per share computations                           30,610         30,371
 
 
                             ON COMMAND CORPORATION
                     Condensed Consolidated Balance Sheets
                                 (in thousands)
 
                                                    March 31,     December 31,
                                                       2001            2000
 
     ASSETS
     CURRENT ASSETS:
      Cash and cash equivalents                        $1,832         $3,569
      Accounts receivable, net                         35,763         35,514
      Note receivable                                       0          1,445
      Other current assets                              1,782          1,993
 
       Total current assets                            39,377         42,521
 
     VIDEO SYSTEMS, Net                               286,625        296,221
     PROPERTY AND EQUIPMENT, Net                       23,338         21,182
     GOODWILL, Net                                     68,477         68,921
     NOTE RECEIVABLE                                        0          5,015
     INVESTMENTS IN SUBSIDIARIES                       26,398          1,563
     OTHER ASSETS, Net                                  4,811          3,871
 
                                                     $449,026       $439,294
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     CURRENT LIABILITIES:
      Accounts payable                                $34,616        $41,772
      Accrued compensation                              7,773          6,932
      Other current liabilities                         9,074         17,068
 
       Total current liabilities                       51,463         65,772
 
     OTHER ACCRUED LIABILITIES                          1,126          1,332
     REVOLVING CREDIT FACILITY                        273,133        247,133
 
       Total liabilities                              325,722        314,237
 
     STOCKHOLDERS' EQUITY                             123,304        125,057
                                                     $449,026       $439,294
 
                   ON COMMAND CORPORATION QUARTERLY STATISTICS
 
                                  Q1 2001 Q4 2000  Q3(1) 2000 Q2 2000  Q1 2000
      Room Base Statistics (2)
     Total Hotels                   3,456    3,519    3,494    3,449     3,416
     Total Guest Pay Rooms        946,000  977,000  975,000  969,000   958,000
     Average rooms per hotel          274      278      279      281       280
 
     On-demand Rooms -
      On Command                  857,000  855,000  837,000  815,000   797,000
     On-demand Rooms -
      SpectraVision                48,000   74,000   85,000   91,000    96,000
     Total On-demand Rooms        905,000  929,000  922,000  906,000   893,000
       % of total rooms              95.7%    95.1%    94.6%    93.5%     93.2%
     Scheduled Rooms
     (all SpectraVision)           41,000   48,000   53,000   63,000    65,000
       % of total rooms               4.3%     4.9%     5.4%     6.5%      6.8%
 
     Domestic Rooms               846,000  843,000  841,000   835,000  827,000
       % of total rooms              89.4%    86.3%    86.3%     86.2%    86.3%
     International Rooms          100,000  134,000  134,000   134,000  131,000
       % of total rooms              10.6%    13.7%    13.7%     13.8%    13.7%
 
     Total Guest Programming
      Rooms                       523,000  520,000  533,000   530,000  528,000
 
     Operating Results &
      Statistics (in thousands)(1)
 
     Total Revenue                $62,214  $65,815  $64,932   $65,769  $64,964
     Direct Expense               $30,037  $31,883  $30,716   $30,061  $30,751
     Direct Profit                $32,177  $33,932  $34,216   $35,708  $34,213
     Operations Expense            $9,197   $7,799   $7,746    $8,255   $7,671
     Research & Development
      Expense                      $1,467   $1,920   $2,464    $1,971   $2,107
     SG&A Expense                  $6,921   $7,835   $7,384    $6,665   $5,853
     Total Operating Expenses     $17,585  $17,554  $17,594   $16,891  $15,631
     EBITDA                       $14,592  $16,378  $16,622   $18,817  $18,582
 
     EBITDA (12 months trailing)  $66,409  $70,399  $70,984   $72,887  $72,376
 
     As a % of Total Revenue:
      Direct Profit Margin           51.7%    51.6%    52.7%     54.3%   52.7%
      Operations                     14.8%    11.8%    11.9%     12.6%   11.8%
      Research & Development          2.4%     2.9%     3.8%      3.0%    3.2%
      SG&A                           11.1%    11.9%    11.4%     10.1%    9.0%
      Total Operating Expenses       28.3%    26.7%    27.1%     25.7%   24.1%
      EBITDA                         23.5%    24.9%    25.6%     28.6%   28.6%
 
     Per Room per Month:
      Total Room Revenue           $20.89   $20.68   $21.54    $21.84  $21.72
      Total Movie Revenue          $18.28   $18.24   $19.09    $19.48  $19.70
      Direct Profit                $11.05   $11.58   $11.73    $12.36  $11.91
      Operations Expense            $3.16    $2.66    $2.66     $2.86   $2.67
      EBITDA                        $5.01    $5.59    $5.70     $6.51   $6.47
 
     Balance Sheet &
      Leverage Statistics*
 
     Interest Expense/
      Total Revenue                   8.6%     8.2%     7.5%      5.2%   5.3%
 
     Average Interest
      Rate During Period              8.2%     9.1%     9.0%      6.8%   7.4%
     Debt/Book Capitalization        68.9%    66.4%    61.2%     57.6%  54.5%
     Debt/Book Equity               221.5%   197.6%   157.6%    136.1% 119.5%
     Debt/12 months EBITDA            4.1      3.5      3.2       2.8    2.6
     12 months EBITDA/
      Annualized Interest Expense     3.5      4.1      4.8       5.7    6.1
 
 
     (1)  LodgeNet payment, of $ 3.9M received in Q3 2000 and $ 3.9M received
 in Q3 1999, excluded from all calculations.
     (2) Asia is not an On Command region effective March 2001.  Asia is
 reflected in all numbers through February 2001.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X38615464
 
 

SOURCE On Command Corporation
    DENVER, April 25 /PRNewswire/ -- On Command Corporation (Nasdaq: ONCO),
 the leading provider of in-room interactive entertainment, Internet services,
 business information and guest services for the lodging industry, today
 announced first quarter 2001 revenues of  $62.2 million and adjusted EBITDA
 (earnings before interest, taxes, depreciation and amortization) for the first
 quarter of 2001 of $14.6 million.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20000718/SFTU067LOGO )
     The Q1 2001 EBITDA figure of $14.6 million, compared to Q4 2000 of
 $16.4 million, decreased primarily due to several reasons: higher costs of
 providing guest programming to hotels, and additional costs in personnel and
 infrastructure to support development of the company's technologies and
 content. The increase in selling, general and administrative (SG&A)
 costs -- both dollar amount and percentage of revenue -- was due, in part, to
 an increase in legal expenses, including a one-time charge of $500,000 related
 to a settlement between On Command and MagiNet Corporation.  It also was
 influenced by long-term company strategies to develop new product lines and
 revenue streams, improvement of customer service, and development of the
 Company's new lower-cost platforms for expansion into smaller hotels and other
 venues.
     The Company's EBITDA margin was 23.5 percent for the first quarter of
 2001, a decrease of approximately five percentage points from the same period
 a year ago, but consistent with a 24.9 percent EBITDA margin in the fourth
 quarter of 2000.  Less attractive movies available from studio distributors
 for Q1 2001 resulted in a decrease in movie revenues as compared to revenues
 from Q1 2000, which featured such Hollywood blockbusters as "American Beauty,"
 and "The Sixth Sense." Room revenues between Q4 2000 and Q1 2001 remained
 consistent with increases as projected in other room revenues, and a
 non-recurring decrease in equipment sales.
     "On Command's Q1 2001 EBITDA was $14.6 million, higher than our budgeted
 expectations for this period, while our EBITDA margin for Q1 2001 is
 23.5 percent. We anticipate this will grow substantially as the company
 continues to reduce costs and launch new products with higher profit margins,"
 said Kathryn Hale, On Command's chief financial officer.  "During this first
 quarter of 2001, we have developed the infrastructure necessary to deploy the
 most advanced technology available to our hotel partners. We project that in
 the second half of 2001 we will show higher levels of revenue and EBITDA
 growth as the upgrade of our hotel rooms continue at a faster pace and the
 Company continues to roll out new products and services."
     During Q1 2001, 35,200 Pacific-Asian rooms -- previously counted in the
 company's room number -- were transferred to the MagiNet partnership and are
 no longer included in the consolidated count currently at 946,000 rooms.
 Excluding the effect of the Asian-Pacific adjustment, On Command experienced a
 net growth of more than 3,600 rooms and added 26,000 TV-Internet systems to
 hotel rooms.
     "During this first quarter of 2001, On Command achieved significant
 progress in reaching corporate milestones. During this period, $1.5 million
 was spent to continue development of our next-generation technology for launch
 later this year," said Jerome H. Kern, On Command's chairman and CEO. "We are
 on track for new initiatives such as the expansion of short-form programming,
 now showing significant revenue growth, and we anticipate additional revenue
 streams from our advertising platform in the latter part of 2001. We also
 restructured our international holdings in Asia, while concurrently increasing
 our rate of installations and reducing installation costs."
 
     Significant milestones reached during the quarter include:
      -- The Company finalized its agreement with Marriott International to
 provide a specially modified version of its interactive television platform in
 more than 165,000 U.S. and Canadian hotel rooms managed by Marriott. On
 Command's services also will be available to 135,000 franchised Marriott hotel
 rooms in the United States and Canada. On Command remains on track to deploy
 its advanced, OCX platform to Marriott Hotel rooms at a record pace.
     -- Announcing its entry into interactive music content, On Command
 Corporation gained a controlling interest in Hotel Digital Music, Inc. also
 known as Digital Music Network (DMN), the programming and content leader in
 on-demand music systems. DMN will provide the content and back-end support for
 "Music OnCommand(TM)," a one-of-a-kind, interactive music service for hotels.
     -- The Company also began deploying ground-breaking short video,
 Internet-TV and interactive music content across its existing hotel base
 during this quarter, and has tracked significant gains in those revenue
 categories. In the category of short video, which includes the HBO series'
 "Sex and the City," and "The Sopranos," as well as exercise and sports videos,
 On Command revenues were $577K for Q1 2001, compared to $52K for Q1 2000, an
 increase of 381 percent. Second quarter 2001 is expected to show higher levels
 of revenue as the company rolls these products out at a faster pace.
 
     About On Command
     On Command Corporation (www.oncommand.com) is the leading provider of in-
 room interactive entertainment, Internet services, business information and
 guest services for the lodging industry and its guests. Based in Denver, with
 offices across the United States and around the world, On Command annually
 serves more than 250 million guests through nearly one million rooms in
 approximately 3,456 hotel properties. These hotel partners include more than
 100 of the most prestigious hotel chains and operators in the lodging
 industry: Adam's Mark Hotels & Resorts, Bass Hotels & Resorts (Inter-
 Continental, Crowne Plaza and Holiday Inn), Fairmont, Four Seasons, Hyatt,
 Loews, Marriott (Courtyard, Renaissance, Fairfield Inn and Residence Inn),
 Radisson, Ramada, Starwood Hotels & Resorts (Westin, Sheraton, W Hotels and
 Four Points), and Wyndham Hotels & Resorts. On Command is listed on the NASDAQ
 Stock Market under the symbol ONCO, and its warrants are traded under the
 symbols ONCOW and ONCOZ.
     Certain of the above statements, other than statements relating to the
 historical performance of On Command, constitute forward-looking statements
 within the meaning of the Private Securities Litigation Reform Act of 1995.
 Such forward-looking statements involve known and unknown risks,
 uncertainties, and other important factors that could cause the actual
 results, performance, or achievements of On Command, or industry results, to
 differ materially from future results, performance, or achievements expressed
 or implied by such forward-looking statements. Such risks, uncertainties and
 other factors include, among others: general economic and business conditions
 and industry trends; the regulatory and competitive environment of the
 industry in which On Command operates; uncertainties inherent in new business
 strategies; new product launches and development plans, including the future
 profitability of such added services and the large capital expenditures
 involved; rapid technological changes; the acquisition, development and/or
 financing of telecommunications networks and services; the development and
 provision of new services, including the customer acceptance and use rates;
 future financial performance, including availability, terms and deployment of
 capital; the ability of vendors to deliver required equipment, software and
 services; availability of qualified personnel; changes in the nature of key
 strategic relationships with hotel chains and their franchises, including the
 renewal of existing agreements on favorable terms; and competitor responses to
 On Command's products and services, and the overall market acceptance of such
 products and services. These factors are also discussed in On Command's
 filings with the Securities and Exchange Commission, including its recent
 filings on Form 10-K and Form 10-Q. These forward-looking statements (and such
 risks, uncertainties and other factors) speak only as of the date hereof, and
 On Command expressly disclaims any obligation or undertaking to disseminate
 any updates or revisions to any forward-looking statement contained herein, to
 reflect any change in On Command's expectations with regard thereto, or any
 other changes in events, conditions, or circumstances on which any such
 statement is based.
 
                             ON COMMAND CORPORATION
                Condensed Consolidated Statements of Operations
                    (In thousands, except per share amounts)
 
 
                                                       Three Months Ended
                                                      3/31/01        3/31/00
 
     REVENUES:
      Room revenues                                   $60,861        $62,386
      Video systems sales/other                         1,353          2,578
     TOTAL REVENUES                                    62,214         64,964
     DIRECT COSTS:
      Room                                             29,077         29,007
      Video system sales / other                          960          1,744
       Total Direct Costs                              30,037         30,751
     DIRECT PROFIT                                     32,177         34,213
     OPERATING EXPENSES:
      Operations                                        9,197          7,671
      Research and development                          1,467          2,107
      Selling, general & administration                 6,921          5,853
 
     TOTAL OPERATING EXPENSES                          17,585         15,631
     EBITDA                                            14,592         18,582
     Depreciation, amortization and
      stock based compensation                         21,265         19,749
     LOSS FROM OPERATIONS                              (6,673)        (1,167)
     Interest/Other expense, net                       (5,330)        (3,294)
     Legal Settlement / Other Asset Impairment         (3,785)             0
     Relocation Expense                                (3,347)             0
     LOSS BEFORE INCOME TAXES                         (19,135)        (4,461)
     Provision for (benefit from) income taxes             30            106
 
     NET LOSS                                        $(19,165)       $(4,567)
 
     Preferred Stock Dividend                          $ (129)           $--
 
     Net applicable to common stockholders           $(19,294)       $(4,567)
 
     Basic and diluted loss per share                  $(0.63)       $ (0.15)
 
     Shares used in basic and diluted
      per share computations                           30,610         30,371
 
 
                             ON COMMAND CORPORATION
                     Condensed Consolidated Balance Sheets
                                 (in thousands)
 
                                                    March 31,     December 31,
                                                       2001            2000
 
     ASSETS
     CURRENT ASSETS:
      Cash and cash equivalents                        $1,832         $3,569
      Accounts receivable, net                         35,763         35,514
      Note receivable                                       0          1,445
      Other current assets                              1,782          1,993
 
       Total current assets                            39,377         42,521
 
     VIDEO SYSTEMS, Net                               286,625        296,221
     PROPERTY AND EQUIPMENT, Net                       23,338         21,182
     GOODWILL, Net                                     68,477         68,921
     NOTE RECEIVABLE                                        0          5,015
     INVESTMENTS IN SUBSIDIARIES                       26,398          1,563
     OTHER ASSETS, Net                                  4,811          3,871
 
                                                     $449,026       $439,294
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     CURRENT LIABILITIES:
      Accounts payable                                $34,616        $41,772
      Accrued compensation                              7,773          6,932
      Other current liabilities                         9,074         17,068
 
       Total current liabilities                       51,463         65,772
 
     OTHER ACCRUED LIABILITIES                          1,126          1,332
     REVOLVING CREDIT FACILITY                        273,133        247,133
 
       Total liabilities                              325,722        314,237
 
     STOCKHOLDERS' EQUITY                             123,304        125,057
                                                     $449,026       $439,294
 
                   ON COMMAND CORPORATION QUARTERLY STATISTICS
 
                                  Q1 2001 Q4 2000  Q3(1) 2000 Q2 2000  Q1 2000
      Room Base Statistics (2)
     Total Hotels                   3,456    3,519    3,494    3,449     3,416
     Total Guest Pay Rooms        946,000  977,000  975,000  969,000   958,000
     Average rooms per hotel          274      278      279      281       280
 
     On-demand Rooms -
      On Command                  857,000  855,000  837,000  815,000   797,000
     On-demand Rooms -
      SpectraVision                48,000   74,000   85,000   91,000    96,000
     Total On-demand Rooms        905,000  929,000  922,000  906,000   893,000
       % of total rooms              95.7%    95.1%    94.6%    93.5%     93.2%
     Scheduled Rooms
     (all SpectraVision)           41,000   48,000   53,000   63,000    65,000
       % of total rooms               4.3%     4.9%     5.4%     6.5%      6.8%
 
     Domestic Rooms               846,000  843,000  841,000   835,000  827,000
       % of total rooms              89.4%    86.3%    86.3%     86.2%    86.3%
     International Rooms          100,000  134,000  134,000   134,000  131,000
       % of total rooms              10.6%    13.7%    13.7%     13.8%    13.7%
 
     Total Guest Programming
      Rooms                       523,000  520,000  533,000   530,000  528,000
 
     Operating Results &
      Statistics (in thousands)(1)
 
     Total Revenue                $62,214  $65,815  $64,932   $65,769  $64,964
     Direct Expense               $30,037  $31,883  $30,716   $30,061  $30,751
     Direct Profit                $32,177  $33,932  $34,216   $35,708  $34,213
     Operations Expense            $9,197   $7,799   $7,746    $8,255   $7,671
     Research & Development
      Expense                      $1,467   $1,920   $2,464    $1,971   $2,107
     SG&A Expense                  $6,921   $7,835   $7,384    $6,665   $5,853
     Total Operating Expenses     $17,585  $17,554  $17,594   $16,891  $15,631
     EBITDA                       $14,592  $16,378  $16,622   $18,817  $18,582
 
     EBITDA (12 months trailing)  $66,409  $70,399  $70,984   $72,887  $72,376
 
     As a % of Total Revenue:
      Direct Profit Margin           51.7%    51.6%    52.7%     54.3%   52.7%
      Operations                     14.8%    11.8%    11.9%     12.6%   11.8%
      Research & Development          2.4%     2.9%     3.8%      3.0%    3.2%
      SG&A                           11.1%    11.9%    11.4%     10.1%    9.0%
      Total Operating Expenses       28.3%    26.7%    27.1%     25.7%   24.1%
      EBITDA                         23.5%    24.9%    25.6%     28.6%   28.6%
 
     Per Room per Month:
      Total Room Revenue           $20.89   $20.68   $21.54    $21.84  $21.72
      Total Movie Revenue          $18.28   $18.24   $19.09    $19.48  $19.70
      Direct Profit                $11.05   $11.58   $11.73    $12.36  $11.91
      Operations Expense            $3.16    $2.66    $2.66     $2.86   $2.67
      EBITDA                        $5.01    $5.59    $5.70     $6.51   $6.47
 
     Balance Sheet &
      Leverage Statistics*
 
     Interest Expense/
      Total Revenue                   8.6%     8.2%     7.5%      5.2%   5.3%
 
     Average Interest
      Rate During Period              8.2%     9.1%     9.0%      6.8%   7.4%
     Debt/Book Capitalization        68.9%    66.4%    61.2%     57.6%  54.5%
     Debt/Book Equity               221.5%   197.6%   157.6%    136.1% 119.5%
     Debt/12 months EBITDA            4.1      3.5      3.2       2.8    2.6
     12 months EBITDA/
      Annualized Interest Expense     3.5      4.1      4.8       5.7    6.1
 
 
     (1)  LodgeNet payment, of $ 3.9M received in Q3 2000 and $ 3.9M received
 in Q3 1999, excluded from all calculations.
     (2) Asia is not an On Command region effective March 2001.  Asia is
 reflected in all numbers through February 2001.
 
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 SOURCE  On Command Corporation