Management's response.
"...I am authorized to provide the following information. On the financing issue, Charter has previously stated that in addition to the recently completed private placement, the company wasseeking additional funds through asset-based lease financing, which it is doing. The funds are designated for use in building out facilities where we have licenses in Latin America, and working capital. Telecommunications and Internet operations are capital-intensive projects, and the company continues to extend its pursuit of licenses in Latin America, with the most recent being our efforts in Costa Rica. Since the funding is an asset-based leasing transaction, there is no dilution of Charter stock. This process is
being completed and we will announce same in the usual manner.
On the issue of dilution, I want to address the comments on your website, as is it not reflective of the actual situation. The stock being sold by certain 144 shareholders has always been listed as outstanding stock, and while it will add to the float, it is not causing any dilution to Charter stock. Additionally, in our recent news release on results for the 1st quarter, it was stated, "In connection with the private placement, certain members of management contributed 2.5 million shares of common stock to the Company to reduce shareholder dilution." This action strongly underscores
Charter's commitment to its shareholders and the success of the organization.
Further, a review of the 1st quarter results points up some positive
information that should be of interest to all shareholders. The net loss for the 1st quarter was $1.5 million less than the loss for the fourth quarter, a remarkable improvement, and the Selling, General and
Administrative costs decreased by more than $2 million over the previous quarter. This is due in large part to the ongoing consolidation efforts of management. As noted, there were $750,000 in first quarter costs that are nonrecurring. The international telecommunications and Internet business of Charter continues to show strong growth. Total international service revenues for 1996 were approximately $800,000, and in the 1st quarter these revenues grew to approximately $444,000, up about $128,000 from the previous quarter. Charter is completing a major change in its corporate structure, and a strategic redefining of its marketing program has been underway since December. Under the direction of Chief Operating Officer Steve Schilling, Charter is preparing to launch a complete solutions-based platform of telecommunications and Internet products and services, with new packaging and pricing for private and corporate customers. Look for full details in an upcoming news release. I have taken the time to provide a full look at Charter, and I hope this information gives you a better feel for where we are. There are positive things underway for our organization, and I believe the activities of the second quarter will produce the kinds of results we are all working towards. I will be glad to answer any questions, or comment on any part of the information in this correspondence. Thanks for your interest and time, regards..."
Richard Ames
Director of Communications
and Investor Relations
Charter Communications International, Inc.
1-800-296-2066 Extension 305 |
