Consolidating Schedules (Notes)

9 Months Ended

Sep. 30, 2019

Each of Charter Operating, TWC, LLC, TWCE, CCO Holdings and certain subsidiaries jointly, severally, fully and unconditionally guarantee the outstanding debt securities of the others (other than the CCO Holdings notes) on an unsecured senior basis and the condensed consolidating financial information has been prepared and presented pursuant to SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered. Certain Charter Operating subsidiaries that are regulated telephone entities only become guarantor subsidiaries upon approval by regulators. This information is not intended to present the financial position, results of operations and cash flows of the individual companies or groups of companies in accordance with generally accepted accounting principles.

The "Intermediate Holding Companies" column includes the assets and liabilities of the captive insurance company, a company wholly-owned by Charter outside of Charter Holdings and which does not, directly or indirectly, own any interest in Charter Holdings. The “Charter Operating and Restricted Subsidiaries” column is presented to comply with the terms of the Credit Agreement.

Comprehensive income equaled net income attributable to Charter shareholders for the nine months ended September 30, 2019. Condensed consolidating financial statements as of September 30, 2019 and December 31, 2018 and for the nine months ended September 30, 2019 and 2018 follow.



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Balance Sheets
As of September 30, 2019

	Non-Guarantor Subsidiaries				Guarantor Subsidiaries
	Charter		Intermediate Holding Companies		CCO Holdings		Charter Operating and Restricted Subsidiaries		Eliminations			Charter Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	218	$	—	$	290	$	—		$	508
Accounts receivable, net	1		31		—		2,252		—			2,284
Receivables from related party	26		463		55		—		(544		)	—
Prepaid expenses and other current assets	7		41		—		548		—			596
Total current assets	34		753		55		3,090		(544		)	3,388

RESTRICTED CASH	—		89		—		—		—			89

INVESTMENT IN CABLE PROPERTIES:
Property, plant and equipment, net	—		658		—		33,560		—			34,218
Customer relationships, net	—		—		—		7,956		—			7,956
Franchises	—		—		—		67,322		—			67,322
Goodwill	—		—		—		29,554		—			29,554
Total investment in cable properties, net	—		658		—		138,392		—			139,050

INVESTMENT IN SUBSIDIARIES	50,471		56,947		76,898		—		(184,316		)	—
OPERATING LEASE RIGHT-OF-USE ASSETS	—		173		—		930		—			1,103
LOANS RECEIVABLE – RELATED PARTY	260		699		545		—		(1,504		)	—
OTHER NONCURRENT ASSETS	2		237		—		1,398		—			1,637

Total assets	$	50,767	$	59,556	$	77,498	$	143,810	$	(186,364	)	$	145,267

LIABILITIES AND SHAREHOLDERS’/MEMBER’S EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	$	26	$	916	$	302	$	7,019	$	—		$	8,263
Operating lease liabilities	—		30		—		180		—			210
Payables to related party	—		—		—		544		(544		)	—
Current portion of long-term debt	—		—		—		3,509		—			3,509
Total current liabilities	26		946		302		11,252		(544		)	11,982

LONG-TERM DEBT	—		—		20,249		51,141		—			71,390
LOANS PAYABLE – RELATED PARTY	—		—		—		1,504		(1,504		)	—
DEFERRED INCOME TAXES	17,542		15		—		52		—			17,609
LONG-TERM OPERATING LEASE LIABILITIES	—		197		—		794		—			991
OTHER LONG-TERM LIABILITIES	225		402		—		2,146		—			2,773

SHAREHOLDERS’/MEMBER’S EQUITY
Controlling interest	32,974		50,471		56,947		76,898		(184,316		)	32,974
Noncontrolling interests	—		7,525		—		23		—			7,548
Total shareholders’/member’s equity	32,974		57,996		56,947		76,921		(184,316		)	40,522

Total liabilities and shareholders’/member’s equity	$	50,767	$	59,556	$	77,498	$	143,810	$	(186,364	)	$	145,267



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Balance Sheets
As of December 31, 2018

	Non-Guarantor Subsidiaries				Guarantor Subsidiaries
	Charter		Intermediate Holding Companies		CCO Holdings		Charter Operating and Restricted Subsidiaries		Eliminations			Charter Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	251	$	—	$	300	$	—		$	551
Accounts receivable, net	1		33		—		1,699		—			1,733
Receivables from related party	27		518		57		—		(602		)	—
Prepaid expenses and other current assets	14		32		—		400		—			446
Total current assets	42		834		57		2,399		(602		)	2,730

RESTRICTED CASH	—		214		—		—		—			214

INVESTMENT IN CABLE PROPERTIES:
Property, plant and equipment, net	—		468		—		34,658		—			35,126
Customer relationships, net	—		—		—		9,565		—			9,565
Franchises	—		—		—		67,319		—			67,319
Goodwill	—		—		—		29,554		—			29,554
Total investment in cable properties, net	—		468		—		141,096		—			141,564

INVESTMENT IN SUBSIDIARIES	53,592		60,530		78,960		—		(193,082		)	—
LOANS RECEIVABLE – RELATED PARTY	251		674		526		—		(1,451		)	—
OTHER NONCURRENT ASSETS	—		222		—		1,403		(3		)	1,622

Total assets	$	53,885	$	62,942	$	79,543	$	144,898	$	(195,138	)	$	146,130

LIABILITIES AND SHAREHOLDERS’/MEMBER’S EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	$	9	$	893	$	283	$	7,620	$	—		$	8,805
Payables to related party	—		—		—		602		(602		)	—
Current portion of long-term debt	—		—		—		3,290		—			3,290
Total current liabilities	9		893		283		11,512		(602		)	12,095

LONG-TERM DEBT	—		—		18,730		50,807		—			69,537
LOANS PAYABLE – RELATED PARTY	—		—		—		1,451		(1,451		)	—
DEFERRED INCOME TAXES	17,376		16		—		—		(3		)	17,389
OTHER LONG-TERM LIABILITIES	215		478		—		2,144		—			2,837

SHAREHOLDERS’/MEMBER’S EQUITY
Controlling interest	36,285		53,592		60,530		78,960		(193,082		)	36,285
Noncontrolling interests	—		7,963		—		24		—			7,987
Total shareholders’/member’s equity	36,285		61,555		60,530		78,984		(193,082		)	44,272

Total liabilities and shareholders’/member’s equity	$	53,885	$	62,942	$	79,543	$	144,898	$	(195,138	)	$	146,130



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Statements of Operations
For the nine months ended September 30, 2019

	Non-Guarantor Subsidiaries						Guarantor Subsidiaries
	Charter			Intermediate Holding Companies			CCO Holdings			Charter Operating and Restricted Subsidiaries			Eliminations			Charter Consolidated
REVENUES	$	39		$	880		$	—		$	33,997		$	(913	)	$	34,003

COSTS AND EXPENSES:
Operating costs and expenses (exclusive of items shown separately below)	39			843			—			21,950			(917		)	21,915
Depreciation and amortization	—			12			—			7,453			—			7,465
Other operating (income) expense, net	—			(10		)	—			77			4			71
	39			845			—			29,480			(913		)	29,451
Income from operations	—			35			—			4,517			—			4,552

OTHER INCOME (EXPENSES):
Interest income (expense), net	7			25			(785		)	(2,080		)	—			(2,833		)
Loss on financial instruments, net	—			—			—			(116		)	—			(116		)
Other pension benefits, net	—			—			—			27			—			27
Other expense, net	—			(2		)	—			(129		)	—			(131		)
Equity in income of subsidiaries	1,180			1,347			2,132			—			(4,659		)	—
	1,187			1,370			1,347			(2,298		)	(4,659		)	(3,053		)

Income before income taxes	1,187			1,405			1,347			2,219			(4,659		)	1,499
Income tax expense	(233		)	(10		)	—			(86		)	—			(329		)
Consolidated net income	954			1,395			1,347			2,133			(4,659		)	1,170
Less: Net income attributable to noncontrolling interests	—			(215		)	—			(1		)	—			(216		)
Net income	$	954		$	1,180		$	1,347		$	2,132		$	(4,659	)	$	954



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Statements of Operations
For the nine months ended September 30, 2018

	Non-Guarantor Subsidiaries						Guarantor Subsidiaries
	Charter			Intermediate Holding Companies			CCO Holdings			Charter Operating and Restricted Subsidiaries			Eliminations			Charter Consolidated
REVENUES	$	37		$	844		$	—		$	32,390		$	(868	)	$	32,403

COSTS AND EXPENSES:
Operating costs and expenses (exclusive of items shown separately below)	37			810			—			20,742			(868		)	20,721
Depreciation and amortization	—			8			—			7,776			—			7,784
Other operating expenses, net	—			4			—			112			—			116
	37			822			—			28,630			(868		)	28,621
Income from operations	—			22			—			3,760			—			3,782

OTHER INCOME (EXPENSES):
Interest income (expense), net	7			21			(762		)	(1,896		)	—			(2,630		)
Other pension benefits, net	—			—			—			247			—			247
Other expense, net	—			(26		)	—			(49		)	—			(75		)
Equity in income of subsidiaries	1,085			1,286			2,048			—			(4,419		)	—
	1,092			1,281			1,286			(1,698		)	(4,419		)	(2,458		)

Income before income taxes	1,092			1,303			1,286			2,062			(4,419		)	1,324
Income tax expense	(158		)	(7		)	—			(13		)	—			(178		)
Consolidated net income	934			1,296			1,286			2,049			(4,419		)	1,146
Less: Net income attributable to noncontrolling interests	—			(211		)	—			(1		)	—			(212		)
Net income	$	934		$	1,085		$	1,286		$	2,048		$	(4,419	)	$	934



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Statements of Comprehensive Income
For the nine months ended September 30, 2018

	Non-Guarantor Subsidiaries						Guarantor Subsidiaries
	Charter			Intermediate Holding Companies			CCO Holdings			Charter Operating and Restricted Subsidiaries			Eliminations			Charter Consolidated
Consolidated net income	$	934		$	1,296		$	1,286		$	2,049		$	(4,419	)	$	1,146
Foreign currency translation adjustment	(1		)	(1		)	(1		)	(1		)	3			(1		)
Consolidated comprehensive income	$	933		$	1,295		$	1,285		$	2,048		$	(4,416	)	$	1,145
Less: Comprehensive income attributable to noncontrolling interests	—			(211		)	—			(1		)	—			(212		)
Comprehensive income	$	933		$	1,084		$	1,285		$	2,047		$	(4,416	)	$	933



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Statements of Cash Flows
For the nine months ended September 30, 2019

	Non-Guarantor Subsidiaries						Guarantor Subsidiaries
	Charter			Intermediate Holding Companies			CCO Holdings			Charter Operating and Restricted Subsidiaries			Eliminations			Charter Consolidated
NET CASH FLOWS FROM OPERATING ACTIVITIES	$	(22	)	$	65		$	(762	)	$	9,109		$	—		$	8,390

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment	—			(67		)	—			(4,913		)	67			(4,913		)
Change in accrued expenses related to capital expenditures	—			—			—			(449		)	—			(449		)
Real estate investments through variable interest entities	—			(125		)	—			—			—			(125		)
Contributions to subsidiaries	(117		)	(54		)	(1,559		)	—			1,730			—
Distributions from subsidiaries	4,601			5,222			5,988			—			(15,811		)	—
Other, net	—			(8		)	—			85			(67		)	10
Net cash flows from investing activities	4,484			4,968			4,429			(5,277		)	(14,081		)	(5,477		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings of long-term debt	—			—			1,515			11,642			—			13,157
Repayments of long-term debt	—			—			—			(10,886		)	—			(10,886		)
Payments for debt issuance costs	—			—			(14		)	(34		)	—			(48		)
Purchase of treasury stock	(4,568		)	—			—			—			—			(4,568		)
Proceeds from exercise of stock options	106			—			—			—			—			106
Purchase of noncontrolling interest	—			(593		)	—			—			—			(593		)
Distributions to noncontrolling interest	—			(114		)	—			(2		)	—			(116		)
Contributions from parent	—			117			54			1,559			(1,730		)	—
Distributions to parent	—			(4,601		)	(5,222		)	(5,988		)	15,811			—
Other, net	—			—			—			(133		)	—			(133		)
Net cash flows from financing activities	(4,462		)	(5,191		)	(3,667		)	(3,842		)	14,081			(3,081		)

NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH	—			(158		)	—			(10		)	—			(168		)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period	—			465			—			300			—			765
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period	$	—		$	307		$	—		$	290		$	—		$	597



Charter Communications, Inc. and Subsidiaries
Condensed Consolidating Statements of Cash Flows
For the nine months ended September 30, 2018

	Non-Guarantor Subsidiaries						Guarantor Subsidiaries
	Charter			Intermediate Holding Companies			CCO Holdings			Charter Operating and Restricted Subsidiaries			Eliminations			Charter Consolidated
NET CASH FLOWS FROM OPERATING ACTIVITIES	$	4		$	91		$	(728	)	$	9,232		$	—		$	8,599

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment	—			—			—			(6,692		)	—			(6,692		)
Change in accrued expenses related to capital expenditures	—			—			—			(620		)	—			(620		)
Real estate investments through variable interest entities	—			(15		)	—			—			—			(15		)
Contribution to subsidiaries	(56		)	(127		)	(127		)	—			310			—
Distributions from subsidiaries	3,217			3,763			4,491			—			(11,471		)	—
Other, net	—			(10		)	—			(93		)	—			(103		)
Net cash flows from investing activities	3,161			3,611			4,364			(7,405		)	(11,161		)	(7,430		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings of long-term debt	—			—			—			11,552			—			11,552
Repayments of long-term debt	—			—			—			(8,964		)	—			(8,964		)
Borrowings (repayments) loans payable - related parties	(7		)	—			—			7			—			—
Payments for debt issuance costs	—			—			—			(29		)	—			(29		)
Purchase of treasury stock	(3,214		)	—			—			—			—			(3,214		)
Proceeds from exercise of stock options	56			—			—			—			—			56
Purchase of noncontrolling interest	—			(473		)	—			—			—			(473		)
Distributions to noncontrolling interest	—			(113		)	—			(1		)	—			(114		)
Contributions from parent	—			56			127			127			(310		)	—
Distributions to parent	—			(3,217		)	(3,763		)	(4,491		)	11,471			—
Borrowings for real estate investments through variable interest entities	—			170			—			—			—			170
Distributions to variable interest entities noncontrolling interest	—			(107		)	—			—			—			(107		)
Other, net	—			—			—			(7		)	—			(7		)
Net cash flows from financing activities	(3,165		)	(3,684		)	(3,636		)	(1,806		)	11,161			(1,130		)

NET INCRASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH	—			18			—			21			—			39
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period	—			291			—			330			—			621
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period	$	—		$	309		$	—		$	351		$	—		$	660