1Q09 EARNINGS: General Communications

Looking Good up North

Anchorage, Alaska-based General Communications (Nasdaq:GNCMA) turned in its best first quarter ever with double digit gains in revenue and OIBDA.  The company expects 2009 revenue to grow between 7% and 8%.

Much of the reported revenue growth is attributable to revenues added as a result of GNCMA’s June 1, 2008 acquisition of Unicom (The Deal Advisor, 07/08, p.10) and its July 1, 2008 acquisition of Alaska Wireless.  But video and data revenues were also up as existing customers upgraded to packages offering premium services. 

Additionally, wireless revenues continue to grow as GNCMA adds subs and expands its new wireless network.  GNCMA expects to complete its statewide wireless network by 2011.  GNCMA is close to completing the transfer of its wireless customers from the old Dobson Communications network—now owned by AT&T (NYSE:T).  The company expects to finish the conversion by the end of 2Q09.

For some time now it has been a fierce battle between GNCMA and Alaska Communications (Nasdaq:ALSK) for the Alaska telecommunications customer.  GNCMA’s bundled offerings are clearly taking their toll on ALSK, which has been steadily losing customers while GNCMA has been gaining new subs.  GNCMA increased voice subscribers by 6.7% YoY while ALSK’s coiuce connections declined 10.3% over the same period.  GNCMA also gained wireless subscribers while ALSK saw a slight decrease.  ALSK likes to pride itself on selling more premium services, but GNCMA also experienced both data and video revenue increases from customers upgrading to its premium plans.