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8-K/A - AMENDMENT TO FORM 8-K - Ascent Capital Group, Inc.a14-7678_18ka.htm

Exhibit 99.1

 

Source: Company management Dollars in millions 2009 and 2010 Revenue and Adjusted EBITDA for Monitronics are as of the fiscal year ended June 30th; the Company changed to calendar year fiscal years in connection with its acquisition by Ascent in December 2010 Monitronics Revenue and Adjusted EBITDA for the years ended December 31, 2011 and December 31, 2010 exclude the negative impact of a $2.3 million and $3.0 million, respectively, fair value adjustment related to deferred revenue in relation to Ascent’s acquisition of Monitronics Security Networks’ Revenue for each of the years ended Dec. 31, 2012, 2011, 2010 and 2009 and Adjusted EBITDA for the year ended Dec. 31, 2012 have been derived entirely from the books and records of Security Networks Security Networks’ Adjusted EBITDA for the year ended Dec. 31, 2012 excludes approximately $982,000 of contingent consideration earn out expense related to the 2010 acquisition of SN by Oak Hill and its affiliates Combined Q3 2013 LQA PF Revenue and Adjusted EBITDA includes Security Networks’ results for the pre-acquisition period July 1, 2013 through August 16, 2013. Combined Q3 2013 LQA PF Adjusted EBITDA excludes operational synergies of $4-6 million associated with the acquisition of SN and previously mentioned for illustrative purposes only. Operational synergies are not intended to reflect management’s projections or guidance Strong Historical Operational Profile Revenue CAGR: 12% / EBITDA CAGR: 13% (1) (1) (2) (2) Revenue CAGR: 38% (3) (4) (2) (3) (1) (2) (3) (1) (3) (5) (3) (4) (3) (3) (3) $47 $30 $39 $53 $78 2009A 2010A 2011A 2012A $153 $190 $216 $236 $282 $234 $275 $314 $345 $409 2009A 2010A 2011A 2012A LQA (6/30/13) Revenue Adj. EBITDA $283 $355 $264 $314 $367 $423 $528 2009A 2010A 2011A 2012A PF LQA (9/30/13) 2009A 2010A 2011A 2012A

 


GRAPHIC

Monitronics generally defines Adjusted EBITDA as net income (loss) before interest, taxes, depreciation and amortization (including the amortization of subscriber accounts) and realized and unrealized loss on derivative instruments, and other non-cash or non-recurring charges such as acquisition related professional fees, write off of deferred financing costs, and stock-based and other non-cash long-term incentive compensation. Adjusted EBITDA does not represent cash flow from operations as defined by generally accepted accounting principles, should not be construed as an alternative to net income or loss and is indicative neither of Monitronics’ operating performance nor of cash flows available to fund all of its cash needs. It is, however, a measurement Monitronics believes is useful to investors to evaluate its operating performance. Adjusted EBITDA is also a measure that Monitronics believes is customarily used by financial analysts to evaluate the financial performance of companies in the security alarm monitoring industry and is one of the financial measures, subject to adjustments, by which Monitronics’ covenants are calculated under the agreements governing its debt obligations. For purposes of this presentation, Monitronics has applied the same definitions of Adjusted EBITDA to the financial information of Security Networks. Adjusted EBITDA Definition

 


Source: Company filings. In accordance with US GAAP, pro-forma adjustments include those adjustments necessary for the three months ended September 30, 2013 had the acquisition of Security Networks occurred on January 1, 2012. Accordingly, these pro-forma adjustments include an increase in adjusted EBITDA associated with the reversal of a $2.5 million fair value adjustment that reduced deferred revenue acquired in the Security Networks acquisition. In connection with the closing, Security Networks reversed an accrual of $1.9 million of legal expenses. Adjusted EBITDA has been reduced on a pro forma basis to remove this unusual item. Adjusted EBITDA Reconciliations Monitronics Security Networks ($ in Thousands) For the Quarter Ended September 30, For the 12 Months Ended December 31, 2013 2012 2011 Actual As Reported PF Adjustments (1) PF Adjusted Actual Actual Net Income (Loss) ($9,310) $3,040 ($6,270) ($16,776) ($6,759) Amortization of subscriber accounts and dealer network 55,746 5,520 $61,266 163,468 159,619 Depreciation 1,910 (212) $1,698 5,286 4,704 Restructuring charges 402 - $402 - - Stock-based compensation expense 361 50 $411 1,384 393 Security Networks acquisition-related costs 1,032 (1,881) ($849) - - Security Networks integration-related costs 535 - $535 - - Realized/unrealized loss on derivative instruments - - $0 2,044 10,601 Refinancing costs - - $0 6,245 - Interest expense 25,732 4,384 $30,116 71,405 42,698 Income tax expense 1,241 146 1,387 2,619 2,564 Adjusted EBITDA $77,649 $11,047 $88,696 $235,675 $213,820 ($ in Thousands) For the 12 Months Ended December 31, 2012 Actual Net Income (Loss) $3,576 Amortization of subscriber accounts and dealer network 24,470 Depreciation 1,138 Stock- based compensation expense 388 Acquisition- related costs -Interest expense 15,816 Income tax expense 100 Contingent consideration earnout expense 982 Adjusted EBITDA $46,470