10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2021
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to

Commission File Number: 001-38101

WideOpenWest, Inc.

(Exact name of registrant as specified in its charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization)	46-0552948 (IRS Employer Identification No.)
7887 East Belleview Avenue, Suite 1000 Englewood, Colorado (Address of Principal Executive Offices)	80111 (Zip Code)

(720) 479-3500

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	WOW	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☒
Non-accelerated filer ☐	Smaller reporting company ☐
Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of outstanding shares of the registrant’s common stock as of April 28, 2021 was 87,123,394.

WIDEOPENWEST, INC AND SUBSIDIARIES

FORM 10-Q

FOR THE THREE MONTHS ENDED MARCH 31, 2021

TABLE OF CONTENTS

		Page
PART I. Financial Information
Item 1:	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Comprehensive Income (Loss)	3
	Condensed Consolidated Statements of Changes in Stockholders’ Deficit	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to the Condensed Consolidated Financial Statements	6
Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3:	Quantitative and Qualitative Disclosures about Market Risk	25
Item 4:	Controls and Procedures	25
PART II. Other Information		26
Item 1:	Legal Proceedings	26
Item 1A:	Risk Factors	26
Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 3:	Defaults Upon Senior Securities	26
Item 4:	Mine Safety Disclosures	26
Item 5:	Other Information	26
Item 6:	Exhibits	27

This Quarterly Report on Form 10-Q is for the three months ended March 31, 2021. Any statement contained in a prior periodic report shall be deemed to be modified or superseded for purposes of this Quarterly Report to the extent that a statement contained herein modifies or supersedes such statement. The Securities and Exchange Commission allows us to “incorporate by reference” information that we file with them, which means that we can disclose important information by referring you directly to those documents. Information incorporated by reference is considered to be part of this Quarterly Report. References in this Quarterly Report to “WOW,” “we,” “us,” “our”, or “the Company” are to WideOpenWest, Inc. and its direct and indirect subsidiaries, unless the context specifies or requires otherwise.

i

Cautionary Statement Regarding Forward-Looking Statements

Certain statements contained in this Quarterly Report that are not historical facts contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent our goals, beliefs, plans and expectations about our prospects for the future and other future events. Such statements involve certain risks, uncertainties and assumptions. Forward-looking statements include all statements that are not historical fact and can be identified by terms such as “may,” “intend,” “might,” “will,” “should,” “could,” “would,” “anticipate,” “expect,” “believe,” “estimate,” “plan,” “project,” “predict,” “potential,” or the negative of these terms. Although these forward-looking statements reflect our good-faith belief and reasonable judgment based on current information, these statements are qualified by important factors, many of which are beyond our control, that could cause our actual results to differ materially from those in the forward-looking statements, including, but not limited to:

● the ability to retain and further attract customers due to increased competition, resource abilities of competitiors, and shifts in the entertainment desires of customers;

● our ability to respond to rapid technological change, including our ability to develop and deploy new products and technologies;

● increases in programming and retransmission costs and/or programming exclusivity in favor of our competitors;

● the disruption or failure of our network information systems or technologies as a result of hacking, viruses, outages or natural disasters in one or more of our geographic markets;

● the effects of new regulations or regulatory changes on our business;

● our substantial level of indebtedness and our ability to comply with all covenants in our debt agreements;

● changes in laws and government regulations that may impact the availability and cost of capital;

● effects of uncertain economic conditions, particularly in light of the current novel coronavirus (“COVID-19”) pandemic, and related factors (e.g., unemployment, decreased disposable income, etc.) which may negatively affect our customers’ demand or ability to pay for our current and future products and services;

● our ability to manage the risks involved in the foregoing; and

other factors described from time to time in our reports filed or furnished with the SEC, and in particular those factors set forth in the section entitled “Risk Factors” in our annual report filed on Form 10-K with the SEC on February 24, 2021 and other reports subsequently filed with the SEC. Given these uncertainties, you should not place undue reliance on any such forward-looking statements. The forward-looking statements included in this report are made as of the date hereof or the date specified herein, based on information available to us as of such date. Except as required by law, we assume no obligation to update these forward-looking statements, even if new information becomes available in the future.

ii

PART I-FINANCIAL INFORMATION

WIDEOPENWEST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

	March 31,		December 31,
	2021		2020
	(in millions, except share data)
Assets
Current assets
Cash and cash equivalents	$	36.1	$	12.4
Accounts receivable—trade, net of allowance for doubtful accounts of $9.1 and $8.6, respectively		58.5		69.5
Accounts receivable—other, net		3.0		3.7
Prepaid expenses and other		39.7		29.2
Total current assets		137.3		114.8
Right-of-use lease assets—operating		23.6		24.9
Property, plant and equipment, net		1,098.3		1,100.3
Franchise operating rights		785.5		785.5
Goodwill		408.8		408.8
Intangible assets subject to amortization, net		2.0		2.1
Other non-current assets		49.6		50.6
Total assets	$	2,505.1	$	2,487.0
Liabilities and stockholders’ deficit
Current liabilities
Accounts payable—trade	$	47.1	$	43.8
Accrued interest		3.6		4.0
Current portion of long-term lease liability—operating		6.6		6.5
Accrued liabilities and other		86.6		98.6
Current portion of long-term debt and finance lease obligations		38.4		37.5
Current portion of unearned service revenue		46.3		45.5
Total current liabilities		228.6		235.9
Long-term debt and finance lease obligations, net of debt issuance costs —less current portion		2,243.2		2,228.5
Long-term lease liability—operating		19.9		21.3
Deferred income taxes, net		202.1		200.6
Other non-current liabilities		13.3		13.1
Total liabilities		2,707.1		2,699.4
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $0.01 par value, 100,000,000 shares authorized; 0 shares issued and outstanding		—		—
Common stock, $0.01 par value, 700,000,000 shares authorized; 95,853,288 and 95,187,161 issued as of March 31, 2021 and December 31, 2020, respectively; 87,116,738 and 86,847,797 outstanding as of March 31, 2021 and December 31, 2020, respectively		1.0		1.0
Additional paid-in capital		336.9		333.8
Accumulated other comprehensive loss		(2.2)		(6.5)
Accumulated deficit		(450.4)		(460.0)
Treasury stock at cost, 8,736,550 and 8,339,364 shares as of March 31, 2021 and December 31, 2020, respectively		(87.3)		(80.7)
Total stockholders’ deficit		(202.0)		(212.4)
Total liabilities and stockholders’ deficit	$	2,505.1	$	2,487.0

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

1

WIDEOPENWEST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

	Three months ended
	March 31,
	2021		2020
	(in millions, except per share data)
Revenue	$	286.3	$	284.5
Costs and expenses:
Operating (excluding depreciation and amortization)		138.0		148.5
Selling, general and administrative		45.2		46.8
Depreciation and amortization		61.8		55.8
		245.0		251.1
Income from operations		41.3		33.4
Other income (expense):
Interest expense		(31.4)		(33.5)
Gain on sale of assets, net		—		0.3
Other income, net		0.6		0.7
Income before provision for income tax		10.5		0.9
Income tax expense		(0.9)		(0.8)
Net income	$	9.6	$	0.1
Basic and diluted earnings per common share
Basic	$	0.12	$	0.00
Diluted	$	0.11	$	0.00
Weighted-average common shares outstanding
Basic		82,031,043		81,037,633
Diluted		85,629,983		81,536,813

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2

WIDEOPENWEST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited)

	Three months ended
	March 31,
	2021		2020
	(in millions)
Net income	$	9.6	$	0.1
Unrealized gain (loss) on derivative instrument, net of tax		4.3		(3.0)
Comprehensive income (loss)	$	13.9	$	(2.9)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3

WIDEOPENWEST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020

(unaudited)

								Accumulated
		Common		Treasury		Additional		Other				Total
	Common	Stock		Stock at		Paid-in		Comprehensive		Accumulated		Stockholders'
	Stock	Par Value		Cost		Capital		Loss		Deficit		Deficit
	(in millions, except share data)
Balances at January 1, 2021	86,847,797	$	1.0	$	(80.7)	$	333.8	$	(6.5)	$	(460.0)	$	(212.4)
Changes in accumulated other comprehensive gain	—		—		—		—		4.3		—		4.3
Stock-based compensation	—		—		—		3.1		—		—		3.1
Issuance of restricted stock, net	666,127		—		—		—		—		—		—
Purchase of shares	(397,186)		—		(6.6)		—		—		—		(6.6)
Net income	—		—		—		—		—		9.6		9.6
Balances at March 31, 2021(1)	87,116,738	$	1.0	$	(87.3)	$	336.9	$	(2.2)	$	(450.4)	$	(202.0)

(1) Included in outstanding shares as of March 31, 2021 are 4,423,885 non-vested shares of restricted stock awards granted to employees and directors.

								Accumulated
		Common		Treasury		Additional		Other				Total
	Common	Stock		Stock at		Paid-in		Comprehensive		Accumulated		Stockholders'
	Stock	Par Value		Cost		Capital		Loss		Deficit		Deficit
	(in millions, except share data)
Balances at January 1, 2020	84,103,108	$	0.9	$	(79.7)	$	322.8	$	(15.5)	$	(474.4)	$	(245.9)
Changes in accumulated other comprehensive loss	—		—		—		—		(3.0)		—		(3.0)
Stock-based compensation	—		—		—		2.7		—		—		2.7
Issuance of restricted stock, net	2,858,421		—		—		—		—		—		—
Purchase of shares	(199,520)		—		(0.7)		—		—		—		(0.7)
Net income	—		—		—		—		—		0.1		0.1
Balances at March 31, 2020(1)	86,762,009	$	0.9	$	(80.4)	$	325.5	$	(18.5)	$	(474.3)	$	(246.8)

(1) Included in outstanding shares as of March 31, 2020 are 5,292,277 non-vested shares of restricted stock awards  granted to employees and directors.

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4

WIDEOPENWEST, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	Three months ended
	March 31,
	2021		2020
	(in millions)
Cash flows from operating activities:
Net income	$	9.6	$	0.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		61.8		55.8
Deferred income taxes		0.2		(0.1)
Provision for doubtful accounts		2.9		7.3
Gain on sale of assets, net		—		(0.3)
Amortization of debt issuance costs and discount		1.2		1.2
Non-cash compensation		3.1		2.7
Other non-cash items		(0.1)		—
Changes in operating assets and liabilities:
Receivables and other operating assets		(0.7)		(12.2)
Payables and accruals		(0.4)		(2.1)
Net cash provided by operating activities	$	77.6	$	52.4
Cash flows from investing activities:
Capital expenditures	$	(59.3)	$	(58.0)
Other investing activities		0.4		(1.1)
Net cash used in investing activities	$	(58.9)	$	(59.1)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	$	31.0	$	41.0
Payments on long-term debt and finance lease obligations		(19.4)		(17.8)
Purchase of shares		(6.6)		(0.7)
Net cash provided by financing activities	$	5.0	$	22.5
Increase in cash and cash equivalents		23.7		15.8
Cash and cash equivalents, beginning of period		12.4		21.0
Cash and cash equivalents, end of period	$	36.1	$	36.8
Supplemental disclosures of cash flow information:
Cash paid during the periods for interest	$	30.7	$	31.4
Cash paid during the periods for income taxes, net	$	—	$	—
Non-cash operating activities:
Operating lease additions	$	0.1	$	2.4
Non-cash financing activities:
Finance lease additions	$	2.8	$	1.2
Capital expenditure accounts payable and accruals	$	17.0	$	13.8

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5

WIDEOPENWEST, INC. AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2021

(unaudited)

Note 1. General Information

WideOpenWest, Inc. (“WOW” or the “Company”) is a leading broadband services provider offering high-speed data (“HSD”), cable television (“Video”), and digital telephony (“Telephony”) services to residential and business customers. The Company serves customers in nineteen Midwestern and Southeastern markets in the United States. The Company manages and operates its Midwestern broadband networks in Detroit and Lansing, Michigan; Chicago, Illinois; Cleveland and Columbus, Ohio; Evansville, Indiana and Baltimore, Maryland. The Southeastern systems are located in Augusta, Columbus, Newnan and West Point, Georgia; Charleston, South Carolina; Dothan, Auburn, Huntsville and Montgomery, Alabama; Knoxville, Tennessee; and Panama City and Pinellas County, Florida.

The Company’s operations are managed and reported to its Chief Executive Officer (“CEO”), the Company’s chief operating decision maker, on a consolidated basis. The CEO assesses performance and allocates resources based on the consolidated results of operations. Under this organizational and reporting structure, the Company operates as one reportable segment.

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission (“SEC”); however, in the opinion of management, the disclosures made are adequate to ensure the information presented is not misleading. The year-end consolidated balance sheet was derived from audited financial statements.

In the opinion of management, all normally recurring adjustments considered necessary for the fair presentation of the financial statements have been included, and the financial statements present fairly the financial position and results of operations for the interim periods presented. The results of operations for any interim period are not necessarily indicative of results expected for the full year or any future period. These unaudited condensed consolidated financial statements should be read in conjunction with the 2020 Annual Report filed with the SEC on February 24, 2021.

All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in accordance with GAAP requires management to make assumptions and estimates that affect the reported amounts and disclosures of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts and disclosures of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, including but not limited to the potential impacts arising from COVID-19. To the extent there are differences between those estimates and actual results, the unaudited condensed consolidated financial statements may be materially affected.

6

Recently Issued Accounting Standards

ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 provides optional guidance, expedients and exceptions for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in this update apply to all entities, subject to meeting the criteria, which participate in contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 was subsequently amended by ASU 2021-01, Reference Rate Reform (Topic  848), Scope, which refines the scope of Topic 848 and permits optional expendients and exceptions when accounting for derivative contracts and certain hedging relationships. The amendments of these updates are available to all entities as of March 12, 2020 through December 31, 2022. The Company has not yet adopted these amendments, but has determined the impact of adopting this guidance will not have a material impact on its financial position, results of operations and cash flows.

Recently Adopted Accounting Pronouncements

ASU 2019-12, Income Taxes—Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company adopted this guidance prospectively as of January 1, 2021. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows.

Note 3. Revenue from Contracts with Customers

Revenue by Service Offering

The following table presents revenue by service offering for the three months ended March 31, 2021 and 2020:

	Three months ended March 31, 2021						Three months ended March 31, 2020
	Residential		Business		Total			Residential		Business		Total
	Subscription		Subscription		Revenue			Subscription		Subscription		Revenue
	(in millions)
HSD	$	129.8	$	22.9	$	152.7	$	115.3	$	21.3	$	136.6
Video		89.6		3.7		93.3		99.5		3.9		103.4
Telephony		11.6		10.2		21.8		14.0		10.6		24.6
Total subscription services revenue	$	231.0	$	36.8	$	267.8	$	228.8	$	35.8	$	264.6
Other business services revenue(1)		—		—		6.2		—		—		6.5
Other revenue		—		—		12.3		—		—		13.4
Total revenue	$	231.0	$	36.8	$	286.3	$	228.8	$	35.8	$	284.5

(1) Includes wholesale and colocation revenue of $5.4 million for both the three months ended March 31, 2021 and 2020.

7

Costs of Obtaining Contracts with Customers

The following table summarizes the activity of costs of obtaining contracts with customers:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	49.6	$	40.7
Deferral		4.9		5.7
Amortization		(3.6)		(2.7)
Balance at end of period	$	50.9	$	43.7

The following table presents the current and non-current portion of costs of obtaining contracts with customers as of the end of the corresponding periods:

	March 31,  2021		December 31,  2020
	(in millions)
Current costs of obtaining contracts with customers	$	16.7	$	15.3
Non-current costs of obtaining contracts with customers		34.2		34.3
Total costs of obtaining contracts with customers	$	50.9	$	49.6

The current portion and the non-current portion of costs of obtaining contracts with customers are included in prepaid expenses and other and other non-current assets, respectively, in the Company’s unaudited condensed consolidated balance sheets. Amortization of costs of obtaining contracts with customers is included in selling, general and administrative expense in the Company’s unaudited condensed consolidated statements of operations.

Contract Liabilities

The following table summarizes the activity of current and non-current contract liabilities:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	4.2	$	4.2
Deferral		4.6		3.7
Revenue recognized		(4.2)		(4.0)
Balance at end of period	$	4.6	$	3.9

The following table presents the current and non-current portion of contract liabilities as of the end of the corresponding periods:

	March 31,  2021		December 31,  2020
	(in millions)
Current contract liabilities	$	4.0	$	3.6
Non-current contract liabilities		0.6		0.6
Total contract liabilities	$	4.6	$	4.2

8

The current portion and the non-current portion of contract liabilities are included in the current portion of unearned service revenue and other non-current liabilities, respectively, in the Company’s unaudited condensed consolidated balance sheets.

Unsatisfied Performance Obligations

Revenue from month-to-month residential subscription service contracts have historically represented a significant portion of the Company’s revenue and the Company expects that this will continue to be the case in future periods.  All residential subscription service performance obligations will be satisfied within one year.

A summary of expected business subscription and other business services revenue to be recognized in future periods related to performance obligations which have not been satisfied or are partially unsatisfied as of March 31, 2021 is set forth in the table below:

	2021		2022		2023		Thereafter		Total
	(in millions)
Subscription services	$	54.2	$	41.5	$	16.3	$	6.1	$	118.1
Other business services		2.8		2.1		0.7		0.1		5.7
Total expected revenue	$	57.0	$	43.6	$	17.0	$	6.2	$	123.8

Provision for Doubtful Accounts

The provision for doubtful accounts and the allowance for doubtful accounts are based on the aging of the individual receivables, historical trends and current and anticipated future economic conditions. The Company manages credit risk by disconnecting services to customers who are delinquent, generally after sixty days of delinquency. The individual receivables are written-off after all reasonable efforts to collect the funds have been made. Actual write-offs may differ from the amounts reserved.

The following table presents the change in the allowance for doubtful accounts for trade accounts receivable for the three months ended March 31, 2021 compared to the three months ended March 31, 2020:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	8.6	$	7.5
Provision charged to expense		2.9		5.3
Accounts written off, net of recoveries		(2.4)		(3.8)
Balance at end of period	$	9.1	$	9.0

The Company established an allowance for doubtful accounts for non-trade accounts receivable of $2.0 million as of March 31, 2020 that is presented within accounts receivable—other in the Company’s unaudited condensed consolidated balance sheets. The Company did not have such an allowance as of March 31, 2021.

9

Note 4. Plant, Property and Equipment, Net

Plant, property and equipment consists of the following:

	March 31,		December 31,
	2021		2020
	(in millions)
Distribution facilities	$	1,999.3	$	1,960.0
Customer premise equipment		488.1		481.5
Head-end equipment		369.8		364.3
Telephony infrastructure		99.0		99.3
Computer equipment and software		169.2		163.9
Vehicles		34.6		35.9
Buildings and leasehold improvements		49.8		49.7
Office and technical equipment		34.8		34.8
Land		6.2		6.2
Construction in progress (including material inventory and other)		50.4		50.5
Total property, plant and equipment		3,301.2		3,246.1
Less accumulated depreciation		(2,202.9)		(2,145.8)
	$	1,098.3	$	1,100.3

Depreciation expense for the three months ended March 31, 2021 and 2020 was $61.7 million and $55.4 million, respectively.

Note 5. Accrued Liabilities and Other

Accrued liabilities and other consists of the following:

	March 31,		December 31,
	2021		2020
	(in millions)
Programming costs	$	32.4	$	30.0
Payroll and employee benefits		20.1		28.0
Other accrued liabilities		10.3		9.9
Franchise and revenue sharing fees		9.1		11.0
Property, income, sales and use taxes		7.0		5.8
Utility pole costs		3.9		4.5
Interest rate swaps		3.8		9.4
	$	86.6	$	98.6

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Note 6. Long-Term Debt and Finance Leases

The following table summarizes the Company’s long-term debt and finance leases:

							December 31,
	March 31, 2021						2020
	Available
	borrowing		Effective		Outstanding		Outstanding
	capacity		interest rate(1)		balance		balance
	(in millions)
Long-term debt:
Term B Loans, net(2)	$	—	5.28	%	$	2,194.7	$	2,199.9
Revolving Credit Facility(3)		235.6	3.11	%		59.0		38.0
Total long-term debt	$	235.6				2,253.7		2,237.9
Other Financing						0.7		0.8
Finance lease obligations						32.2		32.9
Total long-term debt, finance lease obligations and other						2,286.6		2,271.6
Debt issuance costs, net(4)						(5.0)		(5.6)
Sub-total						2,281.6		2,266.0
Less current portion						(38.4)		(37.5)
Long-term portion					$	2,243.2	$	2,228.5

(1) Represents the effective interest rate in effect for all borrowings outstanding as of March 31, 2021 pursuant to each debt instrument including the applicable margin.

(2) At March 31, 2021 and December 31, 2020 includes $5.5 million and $6.1 million of net discounts, respectively.

(3) Available borrowing capacity at March 31, 2021 represents $300.0 million of total availability less borrowing of $59.0 million on the Revolving Credit Facility and outstanding letters of credit of $5.4 million. Letters of credit are used in the ordinary course of business and are released when the respective contractual obligations have been fulfilled by the Company.

(4) At March 31, 2021 and December 31, 2020, debt issuance costs include $4.0 million and $4.4 million related to Term B Loans and $1.0 million and $1.2 million related to the Revolving Credit Facility, respectively.

The Company’s Term B Loans will mature on August 19, 2023 and bear interest, at the Company’s option, at a rate equal to ABR plus 2.25% or LIBOR plus 3.25%. Borrowings under the revolving credit facility will mature on May 31, 2022 and bear interest, at the Company's option, at a rate equal to ABR plus 2.00% or LIBOR plus 3.00%. As of March 31, 2021, the Company was in compliance with all debt covenants.

Note 7. Stock-Based Compensation

WOW’s 2017 Omnibus Incentive Plan provides for grants of stock options, restricted stock and performance awards. The Company’s directors, officers and other employees and persons who engage in services for the Company are eligible for grants under the 2017 Omnibus Incentive Plan. The 2017 Omnibus Incentive Plan has authorized 12,074,128 shares of common stock to be available for issuance, subject to adjustment in the event of a reorganization, stock split, merger or similar change in the Company’s corporate structure of the outstanding shares of common stock.  

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The following table presents restricted stock activity during the three months ended March 31, 2021:

	Number of
	Unvested
	Restricted Stock
	Shares
Outstanding, beginning of period	4,990,971
Granted	767,689
Vested	(1,233,213)
Forfeited	(101,562)
Outstanding, end of period(1)	4,423,885

(1) The total outstanding non-vested shares of restricted stock awards granted to employees and directors are included in total outstanding shares as of March 31, 2021.

For restricted stock awards that contain only service conditions for vesting, the Company calculates the award fair value based on the closing stock price on the accounting grant date. Restricted stock generally vests ratably over a four year period based on the date of grant.

Nonvested Performance Shares

On March 3, 2021, the Company granted 209,621 performance shares which will vest based on the Company’s achievement level relative to the following performance measures at December 31, 2023: 50% based upon the Company’s Total Shareholder Return (“TSR”) relative to the TSRs of the Company’s peer group and 50% based on the Company’s three-year cumulative EBITDA metric. EBITDA is defined as net income (loss) before net interest expense, income taxes, depreciation and amortization (including impairments), impairment losses on intangibles and goodwill, management fees to related party, the write-off of any asset, loss on early extinguishment of debt, integration and restructuring expenses and all non-cash charges and expenses (including stock compensation expense) and certain other income and expenses. Upon achievement of the minimum threshold performance metric, the grantee may earn 50% to 200% of their respective target shares based on the performance goal.  

The performance shares based on relative TSR performance have a market condition and are valued using a Monte Carlo simulation model on the grant date, which resulted in a grant date fair value of $27.76 per share. The estimated fair value is amortized to expense over the requisite service period, which ends on December 31, 2023. The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the performance shares with a market condition: risk-free interest rate of 0.26%, volatility factors in the expected market price of the Company's common shares of 59.77% and an expected life of three years.

The performance shares based on three-year cumulative EBITDA have a performance condition. The probability of achieving the performance condition is assessed at each reporting period. If it is deemed probable that the performance condition will be met, compensation cost will be recognized based on the closing price per share of the Company's common stock on the date of the grant multiplied by the number of awards expected to be earned. If it is deemed that it is not probable that the performance condition will be met, the Company will discontinue the recognition of compensation cost and any compensation cost previously recorded will be reversed. At March 31, 2021, achievement of the performance condition for the performance shares was deemed probable.

The Company recorded $3.1 million and $2.7 million for the three months ended March 31, 2021 and 2020, respectively, of non-cash stock-based compensation expense which is reflected in selling, general and administrative expense in the Company’s unaudited condensed consolidated statements of operations.

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Note 8. Earnings per Common Share

Basic earnings or loss per share attributable to the Company’s common stockholders is computed by dividing net income or loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings or loss per share attributable to common stockholders presents the dilutive effect, if any, on a per share basis of potential common shares (such as restricted stock units) as if they had been vested or converted during the periods presented.

	Three months ended
	March 31,
	2021		2020
	(in millions, except share data)
Net income	$	9.6	$	0.1
Basic weighted-average shares		82,031,043		81,037,633
Effect of dilutive securities:
Restricted stock awards		3,598,940		499,180
Diluted weighted-average shares		85,629,983		81,536,813
Basic earnings per share	$	0.12	$	0.00
Diluted earnings per share	$	0.11	$	0.00

The dilutive effect of the potential common shares from the performance shares is included in diluted earnings per share upon the satisfaction of certain performance and market conditions. These conditions are evaluated at each reporting period and if the conditions have been satisfied during the reporting period, the number of contingently issuable shares are included in the computation of diluted earnings per share. As of March 31, 2021, the Company determined the performance conditions were not yet achieved; however, the market conditions indicated a certain level of  achievement within the payout range. Therefore, the contingently issuable performance shares associated with the market condition were included in the computation of diluted earnings per share.

Note 9. Fair Value Measurements

The fair values of cash and cash equivalents, receivables and trade payables approximate their carrying values due to the short-term nature of these instruments. For assets and liabilities of a long-term nature, the Company determines fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Market or observable inputs are the preferred source of values, followed by unobservable inputs or assumptions based on hypothetical transactions in the absence of market inputs. The Company applies the following hierarchy in determining fair value:

● Level 1, defined as observable inputs being quoted prices in active markets for identical assets;

● Level 2, defined as observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

● Level 3, defined as values determined using models that utilize significant unobservable inputs for which little or no market data exists, discounted cash flow methodologies or similar techniques, or other determinations requiring significant management judgment or estimation.

The Company’s derivative instrument is accounted for at fair value on a recurring basis and classified within Level 2 of the valuation hierarchy and was valued at $3.8 million and $9.4 million as of March 31, 2021 and December 31, 2020, respectively. The fair value of the derivative instrument is measured as the present value of all expected future cash flows based on the LIBOR-based swap yield curves as of March 31, 2021. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparties.

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The estimated fair value of the Company’s long-term debt is based on dealer quotes considering current market rates for the Company’s credit facility and is classified as Level 2. The inputs used to determine the fair value of the Company’s aggregate debt balance has trended from quoted market prices in active markets to quoted prices in non-active markets. The fair value of the Company’s long-term debt was valued at $2,200.2 million and $2,203.1 million as of  March 31, 2021 and December 31, 2020, respectively. Long-term debt fair value does not include debt issuance costs and discounts.

There were no transfers into or out of Level 1, 2 or 3 during the periods ended March 31, 2021 and December 31, 2020.

The Company’s nonfinancial assets such as franchise operating rights, property, plant, and equipment, and other intangible assets are not measured at fair value on a recurring basis; however, they are subject to fair value adjustments in certain circumstances, such as when there is evidence that an impairment may exist.  When such impairments are recorded, fair values are generally classified within Level 3 of the valuation hierarchy.

Note 10. Derivative Instruments and Hedging Activities

The Company is exposed to certain risks during the normal course of its business arising from adverse changes in interest rates. The Company selectively uses derivative financial instruments (“derivatives”), including interest rate swaps, to manage interest rate risk. The Company does not hold or issue derivative instruments for speculative purposes. Fluctuations in interest rates can be volatile, and the Company’s risk management activities do not totally eliminate these risks. Consequently, these fluctuations could have a significant effect on the Company’s financial results.

The Company’s exposure to interest rate risk results primarily from its variable rate borrowings. On May 9, 2018, the Company entered into variable to fixed interest rate swap agreements for a notional amount of $1,361.2 million to hedge the outstanding principal balance of its variable rate term loan debt.

As of March 31, 2021, the Company is the fixed rate payor on two interest rate swap contracts that effectively fix the LIBOR-based index used to determine the interest rates charged on the Company’s total long-term debt of $2,259.2 million, not including unamortized debt issuance costs and discount. These contracts fix approximately 60% of the Company’s term loan variable rate exposure at 2.7% and have an expiration date of May 2021. These swap agreements qualify as hedging instruments and have been designated as cash flow hedges of forecasted LIBOR-based interest payments. As all of the critical terms of each of the derivative instruments matched the underlying terms of the hedged debt and related forecasted interest payments, these hedges were considered highly effective. Based on LIBOR-based swap yield curves as of March 31, 2021, the Company expects to reclassify losses of $3.8 million out of accumulated other comprehensive loss (“AOCL”) into earnings within the next 12 months.

The following table summarizes the notional amounts and fair values of the Company’s outstanding derivatives by risk category and instrument type within the unaudited condensed consolidated balance sheet as of March 31, 2021 and December 31, 2020:

			Fair Value
			Accrued
	Notional		Liabilities
	Amount		and Other
Derivatives Designated as Hedging Instruments	(in millions)
Interest rate swap contracts as of March 31, 2021	$	1,320.1	$	3.8
Interest rate swap contracts as of December 31, 2020	$	1,323.5	$	9.4

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Gains and losses on derivatives designated as cash flow hedges included in the unaudited condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2021 and 2020 are shown in the table below:

	Three months ended
	March 31,
	2021		2020
Interest rate swap contracts(1)	(in millions)
Gain (loss) recorded in AOCL on derivatives, before tax	$	5.6	$	(3.9)
Tax impact		(1.3)		0.9
Gain (loss) recorded in AOCL on derivatives, net		4.3		(3.0)

(1) Gains (losses) on derivatives reclassified from AOCL into income will be included in “Interest expense” in the unaudited condensed consolidated statements of operations, the same income statement line item as the earnings effect of the hedged item. Losses recognized in the unaudited condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 total $5.7 million and $3.8 million, respectively.

For the periods presented, all cash flows associated with derivatives are classified as operating cash flows in the unaudited condensed consolidated statements of cash flows.

Note 11. Income Taxes

The Company accounts for income taxes under the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the difference is expected to reverse. Additionally, the impact on deferred tax assets and liabilities of changes in tax rates is reflected in the financial statements in the period that includes the date of enactment.

The Company reported income tax expense of $0.9 million and $0.8 million for the three months ended March 31, 2021 and 2020, respectively. The slight increase in expense is primarily related to an increase in income before tax while the lower effective income tax rate was primarily driven by the windfall deduction related to equity compensation, an increase in the research and development credit, and a decrease in state valuation allowance. The near breakeven income before tax for the three months ended March 31, 2020 resulted in tax adjustments having a larger impact on the effective tax rate as compared to the three months ended March 31, 2021.

Note 12. Commitments and Contingencies

IPO Shareholder Class Action.  Beginning in June 2018, four different plaintiffs’ firms filed five separate class-action lawsuits against WOW, certain individual defendants, and the private equity sponsors and underwriters of the May 2017 initial public offering.  The actions allege violations of Sections 11, 12, and 15 of the 1933 Securities Act.  The three actions filed in New York have been consolidated as Kirkland. et al. v. WideOpenWest, Inc., et al., 653248/2018.  The other two actions, which were filed in Colorado state court, have been stayed by agreement until final resolution of the Kirkland action.  The Plaintiffs in Kirkland allege that Defendants made or caused misstatements to be made in the Registration Statement and Prospectus (“Offering Materials”) issued in connection with the IPO. On January 17, 2019, Defendants filed an omnibus motion to dismiss all claims for failure to state causes of action which the court denied in part and granted in part on May 18, 2020, with the Company thereafter appealing those claims not dismissed. Prior to an anticipated trial in 2022 or 2023, the parties undertook mediation on November 6, 2020 which, in turn, resulted in a soon-to-be-filed Stipulation of Settlement with the court.  Upon approval of the Court to the Stipulation of Settlement (which is expected in the second quarter of 2021), the Company will be dismissed entirely without any admission of wrongdoing in exchange for a payment of substantially less than that sought by plaintiffs, with the funding of such payment substantially from the Company’s primary D&O carrier.

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Sprint Patent Infringement Claim.  On March 7, 2018, Sprint Communications Company L.P (“Sprint”) filed complaints in the U.S. District Court for the District of Delaware alleging that the Company (and other industry participants) infringe patents purportedly relating to Sprint’s Voice over Internet Protocol (“VoIP”) services. The lawsuit is part of a pattern of litigation that was initiated as far back as 2007 by Sprint against numerous broadband and telecommunications providers. The Company has multiple legal and contractual defenses and is vigorously defending against the claims. Additionally, the Company is pursuing indemnification claims against equipment providers whose equipment is implicated by the claims.  Formal discovery was completed in mid-February 2020, with the trial originally scheduled for October 2020, being moved to a yet to be determined date in the middle to second half of 2022.  The Company is unable at this time to determine whether the outcome of the litigation would have a material impact on the Company’s financial position, results of operations or cash flows.

The Company is party to various legal proceedings (including individual, class and putative class actions) arising in the normal course of its business covering a wide range of matters and types of claims including, but not limited to, general contracts, billing disputes, rights of access, programming, taxes, fees and surcharges, consumer protection, trademark and patent infringement, employment, regulatory, tort, claims of competitors and disputes with other carriers.

In accordance with GAAP, the Company accrues an expense for pending litigation when it determines that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. Legal defense costs are expensed as incurred. None of the Company’s existing accruals for pending matters are material. The Company consistently monitors its pending litigation for the purpose of adjusting its accruals and revising its disclosures accordingly, in accordance with GAAP, when required. However, litigation is subject to uncertainty, and the outcome of any particular matter is not predictable. The Company will vigorously defend its interests in pending litigation, and the Company believes that the ultimate resolution of all such matters, after considering insurance coverage or other indemnities to which it is entitled, will not have a material adverse effect on its consolidated financial position, results of operations, or cash flows.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We are a leading broadband services provider offering high-speed data (“HSD”), cable television (“Video”), and digital telephony (“Telephony”) services to residential customers and offer a full range of products and services to business customers. Our services are delivered across 19 markets via our advanced hybrid fiber-coax (“HFC”) network. Our footprint covers certain suburban areas within the states of Alabama, Florida, Georgia, Illinois, Indiana, Maryland, Michigan, Ohio, South Carolina and Tennessee. At March 31, 2021, our broadband networks passed 3.3 million homes and businesses and served 859,200 customers.

Our core strategy is to provide outstanding service at affordable prices. We execute this strategy by managing our operations to focus on the customer. We believe that the customer experience should be reliable, easy and pleasantly surprising, every time. To achieve this customer experience, we operate one of the most technically advanced and uniform networks in the industry with approximately 97% of our network at 750 MHz or greater capacity.

Our advanced network offers HSD speeds up to 1 GIG (1000 Mbps) in approximately 95% of our footprint. Led by our robust HSD offering, our products are available either as an individual service or a bundle to residential and business service customers. We operate under a broadband first strategy. Based on our per subscriber economics, we believe that HSD represents the greatest opportunity to enhance profitability across our residential and business markets.

The events of 2020 accelerated the shift in the industry toward consumption of content over the internet and increased dependency on fast reliable HSD service to effectively work and learn from home. We saw HSD only new connections increase consistently throughout 2020 ending the year with HSD only new connections at 86% of total new connections. This percentage remained consistent in the first quarter of 2021, with the average percentage of HSD only new connections at approximately 86% compared to an average percentage of approximately 66% for the three months ended March 31, 2020. Another trend that emerged during 2020 was the increase in demand for higher internet speeds, with nearly 80% of new HSD only connections purchasing 200MB or higher speeds beginning in the second quarter of 2020. For the first quarter of 2021, approximately 88% of new customers purchased HSD only service at 200MB or higher compared to approximately 51% in the first quarter of 2020.  

To address these trends in 2020, we focused on clearing our network for better bandwidth utilization, providing more desired solutions for our customers, such as WOW! tv+ and alternative video streaming options (e.g., Amazon Firestick),  and optimization of our customer service efforts through enhancements to our online store and the launch of self-installation kits. In 2021, we will continue to manage network bandwidth to meet the needs of our customers and expect to meet capacity demands as network traffic continues to increase. To meet this objective, we will invest in our network to ensure speed and reliability, and obtain a better understanding of how customers utilize our network. Through this understanding, we can make certain capacity improvements and enhance the network to improve the customer experience; as well as introduce more self-help and self-care options to increase flexibility and choice for our customers.  

We continue to monitor the impact of the global health crisis related to the outbreak of coronavirus, or COVID-19, on our business. The primary impact to the Company was its election to participate in several initiatives focused on keeping customers impacted by COVID-19 connected to services. These initiatives include the Federal Communications Commission (“FCC”) Keep Americans Connected Pledge, which expired on June 30, 2020, and the America’s Communications Association (“ACA”) Connects “K-12 Bridge to Broadband” program to help school districts and states provide internet access for students in low-income households. The Company plans to participate in the FCC’s Emergency Broadband Benefit Program as outlined under the Consolidated Appropriations Act of 2021. Under this program, eligible households may apply for a discount of up to $50 per month towards broadband service.  

We have identified other potential impacts to the business as the potential for increases in delinquent customer payments and/or adverse effects on our ability to procure materials and equipment. Thus far, we have not experienced either of these adverse effects throughout the duration of the global health crisis.  However, we are not able to fully predict the overall impact of the global health crisis on our business if these events or other events occur in the future.

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Key Transactions Impacting Operating Results and Financial Condition

Tornado in Newnan, GA

On March 25, 2021, an EF-4 tornado struck the city of Newnan, Georgia leaving devastating damage and widespread power outages resulting in service disruptions to certain customers in this service area. For several days after the storm, our team was dedicated to cleaning up damage and restoring service. As of April 1, 2021, services were restored to more than 90% of impacted customers. As of March 31, 2021, the Company was still in the process of assessing the financial impact of the tornado, but does not believe that it will have a material impact on the Company’s financial position, results of operations or cash flows.

Critical Accounting Policies and Estimates

For a discussion of our critical accounting policies and the means by which we develop estimates refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2020 Annual Report on Form 10-K. There have been no material changes from the critical policies described in our Form 10-K.

Homes Passed and Subscribers

We report homes passed as the number of serviceable addresses, such as single residence homes, apartments and condominium units, and businesses passed by our broadband network and listed in our database. We report total subscribers as the number of subscribers who receive at least one of our HSD, Video or Telephony services, without regard to which or how many services they subscribe. We define each of the individual HSD subscribers, Video subscribers and Telephony subscribers as a revenue generating unit (“RGU”). The following table summarizes homes passed, total subscribers and total RGUs for our services as of each respective date and does not make adjustment for any of the Company’s acquisitions or divestitures:

	Mar. 31,	Jun. 30,	Sep. 30,	Dec. 31,	Mar. 31,
	2020	2020	2020	2020	2021
Homes passed	3,235,200	3,237,700	3,242,400	3,248,600	3,251,900
Total subscribers	838,000	844,500	846,300	850,600	859,200
HSD RGUs	797,600	805,600	808,900	813,800	823,800
Video RGUs	365,800	351,700	328,000	308,200	290,900
Telephony RGUs	190,900	188,100	182,000	177,000	172,800
Total RGUs	1,354,300	1,345,400	1,318,900	1,299,000	1,287,500

The following table displays the homes passed and subscribers related to the Company’s edge-out activities:

	Mar. 31,	Jun. 30,	Sep. 30,	Dec. 31,	Mar. 31,
	2020	2020	2020	2020	2021
Homes passed	187,700	189,700	190,800	194,000	194,600
Total subscribers	44,300	45,200	46,300	47,900	48,800
HSD RGUs	44,000	44,900	46,100	47,600	48,600
Video RGUs	19,200	19,100	18,900	20,400	20,000
Telephony RGUs	7,800	7,800	7,900	8,400	8,400
Total RGUs	71,000	71,800	72,900	76,400	77,000

While we take appropriate steps to ensure subscriber information is presented on a consistent and accurate basis at any given balance sheet date, we periodically review our policies in light of the variability we may encounter across our different markets due to the nature and pricing of products, services and billing systems. Accordingly, we may from time to time make appropriate adjustments to our subscriber information based on such reviews.

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Financial Statement Presentation

Revenue

Our operating revenue is primarily derived from monthly recurring charges for HSD, Video, Telephony and other business services to residential and business customers, in addition to other revenues.

● HSD revenue consists primarily of fixed monthly fees for data service and rental of modems.

● Video revenue consists primarily of fixed monthly fees for basic, premium and digital cable television services and rental of video converter equipment, as well as charges from optional services, such as pay-per-view, video-on-demand and other events available to the customer. The Company is required to pay certain cable franchising authorities an amount based on the percentage of gross revenue derived from video services. The Company generally passes these fees on to the customer, which is included in video revenue.

● Telephony revenue consists primarily of fixed monthly fees for local service and enhanced services, such as call waiting, voice mail and measured and flat rate long-distance service.

● Other business service revenue consists primarily of monthly recurring charges for session initiated protocol, web hosting, metro Ethernet, wireless backhaul, broadband carrier services and cloud infrastructure services provided to business customers.

● Other revenue consists primarily of revenue from line assurance warranty services provided to residential and business customers and revenue from late fees and advertising placement.

Revenues attributable to monthly subscription fees charged to customers for our HSD, Video and Telephony services provided by our broadband networks were 94% and 93% of total revenue for the three months ended March 31, 2021 and 2020. The remaining percentage of total revenue represents non-subscription revenue primarily from other business services, line assurance warranty services and advertising placement.

Costs and Expenses

Our expenses primarily consist of operating, selling, general and administrative expenses, depreciation and amortization expense, and interest expense.

Operating expenses primarily include programming costs, data costs, transport costs and network access fees related to our HSD, Video and Telephony services, hardware/software expenses, network operations and maintenance services, customer service and call center expenses, bad debt, billing and collection expenses and franchise and other regulatory fees.

Selling, general and administrative expenses primarily include salaries and benefits of corporate and field management, sales and marketing personnel, human resources and related administrative costs.

Depreciation and amortization includes depreciation of our network infrastructure, including associated equipment, hardware and software, buildings and leasehold improvements, and finance lease obligations. Amortization is recognized on other intangible assets with definite lives primarily related to acquisitions. Depreciation and amortization expense is presented separately from operating and selling, general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations.

We control our costs of operations by maintaining strict controls on expenditures. More specifically, we are focused on managing our cost structure by improving workforce productivity, increasing the effectiveness of our purchasing activities and maintaining discipline in customer acquisition. We expect programming expenses to continue to increase per Video subscriber due to a variety of factors, including increased demands by owners of some broadcast stations for carriage of other services or payments to those broadcasters for retransmission consent and annual increases imposed by programmers with additional selling power as a result of media consolidation. We have not been able to fully pass these increases on to our customers without the loss of customers, nor do we expect to be able to do so in the future.

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Results of Operations

The following table summarizes our results of operations for the three months ended March 31, 2021 and 2020:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Revenue	$	286.3	$	284.5
Costs and expenses:
Operating (excluding depreciation and amortization)		138.0		148.5
Selling, general and administrative		45.2		46.8
Depreciation and amortization		61.8		55.8
		245.0		251.1
Income from operations		41.3		33.4
Other income (expense):
Interest expense		(31.4)		(33.5)
Gain on sale of assets, net		—		0.3
Other income, net		0.6		0.7
Income before provision for income tax		10.5		0.9
Income tax expense		(0.9)		(0.8)
Net income	$	9.6	$	0.1

Revenue

Revenue for the three months ended March 31, 2021 increased $1.8 million, or 1%, as compared to revenue for the three months ended March 31, 2020 as follows:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Residential subscription	$	231.0	$	228.8
Business services subscription		36.8		35.8
Total subscription		267.8		264.6
Other business services		6.2		6.5
Other		12.3		13.4
	$	286.3	$	284.5

Subscription Revenue

Total subscription revenue increased $3.2 million, or 1%, during the three months ended March 31, 2021 compared to the three months ended March, 31 2020. The increase is driven by an increase of $21.3 million in average revenue per unit (“ARPU”) as HSD customers upgrade to higher speed offerings coupled with an $8.1 million increase in volume attributable exclusively to the addition of HSD subscribers. These increases were partially offset by a  $26.2 million shift in the service offering mix as we continue to experience a reduction in Video and Telephony RGUs. ARPU is calculated as subscription revenue for each of the HSD, Video and Telephony services divided by the average total RGUs for each service category for the respective period.

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Other Business Services

Other business services revenue decreased $0.3 million, or 5%, during the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The decrease is primarily due to a decrease in data center revenue.

Other

Other revenue decreased $1.1 million, or 8%, during the three months ended March 31, 2021 compared to the three months ended March 31, 2020, primarily due to a decrease in line assurance revenue.

Operating expenses (excluding depreciation and amortization)

Operating expenses (excluding depreciation and amortization) decreased $10.5 million, or 7%, during the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The decrease is primarily driven by decreases in direct operating expense, specifically programming expense of $8.9 million, which aligns with the reduction in Video RGUs between periods. During the three months ended March 31, 2020, we recorded additional bad debt expense of $3.2 million related to non-trade accounts receivable and trade accounts receivable as a result of uncertainties around the economic positions of our customers impacted by the global health crisis. We did not incur such expense for the three months ended March 31, 2021. The decreases in direct operating and bad debt expense were partially offset by increases in third-party service provider and pole rental expenses.

Incremental contribution margin

Incremental contribution margin is defined as subscription services revenue less costs directly incurred from third parties in connection with the provision of such services to our customers (service direct expense). Incremental contribution increased $11.6 million, or 7% during the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The increase is primarily due to the decrease in programming expenses from $89.8 million for the three months ended March 31, 2020 to $80.9 million for the three months ended March 31, 2021.

Selling, general and administrative (SG&A) expenses

Selling, general and administrative expenses decreased $1.6 million, or 3%, in the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The decrease is primarily due to a decrease in restructuring and insurance expenses, partially offset by an increase in marketing expenses.  

Depreciation and amortization expenses

Depreciation and amortization expenses increased $6.0 million, or 11%, in the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The increase is primarily due to an increase of equipment and vehicle lease activity.

Interest expense

Interest expense decreased $2.1 million, or 6%, in the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The decrease is primarily due to lower interest rates during the three months ended March 31, 2021, as compared to the three months ended March 31, 2020.

21

Income tax expense

We reported income tax expense of $0.9 million and $0.8 million for the three months ended March 31, 2021 and 2020, respectively. The slight increase in expense is primarily related to an increase in income before tax while the lower effective income tax rate was primarily driven by the windfall deduction related to equity compensation, an increase in the research and development credit, and a decrease in state valuation allowance. The near breakeven income before tax for the three months ended March 31, 2020 resulted in tax adjustments having a larger impact on the effective tax rate as compared to the three months ended March 31, 2021.

Use of Incremental Contribution and Adjusted EBITDA

We use certain measures that are not defined by GAAP to evaluate various aspects of our business such as adjusted EBITDA and incremental contribution. These measures should be considered in addition to, not as a substitute for, consolidated net income (loss) and operating income (loss) or any other performance measures derived in accordance with GAAP as measures of operating performance or operating cash flows, or as measures of liquidity. Our use of the terms adjusted EBITDA and incremental contribution may vary from others in our industry. These metrics have important limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. These metrics do not identify or allocate any other operating costs and expenses that are components of our income (loss) from operations to specific subscription revenues as we do not measure or record such costs and expenses in a manner that would allow attribution to a specific component of subscription revenue.

Adjusted EBITDA

The following table provides a reconciliation of adjusted EBITDA to net income, which is the most directly comparable GAAP measure, for the three months ended March 31, 2021 and 2020:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Net income	$	9.6	$	0.1
Depreciation and amortization		61.8		55.8
Interest expense		31.4		33.5
Gain on sale of assets, net		—		(0.3)
Non-recurring professional fees, M&A integration and restructuring expense		6.2		7.2
Non-cash stock compensation		3.1		2.7
Other income, net		(0.6)		(0.7)
Income tax expense		0.9		0.8
Adjusted EBITDA	$	112.4	$	99.1

Incremental contribution

Incremental contribution is included herein because we believe that it is a key metric used by our management to assess the financial performance of the business by showing how the relative relationship of the various components of subscription services contributes to our overall consolidated historical results. Our management further believes that it provides useful information to investors in evaluating our financial condition and results of operations because the additional detail illustrates how an incremental dollar of revenue generates cash, before any unallocated costs are considered, which we believe is a key component of our overall strategy and important for understanding what drives our cash flow position relative to our historical results. Incremental contribution is defined by us as the components of subscription revenue, less costs directly incurred from third parties in connection with the provision of such services to our customers.

22

The following table provides a reconciliation of incremental contribution to income from operations, which is the most directly comparable GAAP measure, for the three months ended March 31, 2021 and 2020:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Income from operations	$	41.3	$	33.4
Revenue (excluding subscription revenue)		(18.5)		(19.9)
Other non-allocated operating expense (excluding depreciation and amortization)		50.1		52.2
Selling, general and administrative		45.2		46.8
Depreciation and amortization		61.8		55.8
Incremental contribution	$	179.9	$	168.3

Liquidity and Capital Resources

Our primary funding requirements are for our ongoing operations, capital expenditures, outstanding debt obligations, including lease agreements, and strategic investments. At March 31, 2021, the principal amount of our outstanding consolidated debt aggregated to $2,281.6 million, of which $38.4 million is classified as current in our unaudited condensed consolidated balance sheet as of such date. As of March 31, 2021, we had borrowing capacity of $235.6 million under our Revolving Credit Facility representing $300.0 million of total availability less borrowings of $59.0 million and letters of credit of $5.4 million. We are required to prepay principal amounts if we generate excess cash flow, as defined in the Credit Agreement.

We believe that existing cash balances, available borrowing capacity under the Revolving Credit Facility, and operating cash flows will provide sufficient resources to fund our obligations and anticipated liquidity requirements over the next 12 months. We expect to utilize free cash flow and cash on hand as funding sources, as well as potentially engage in future refinancing transactions to further extend the maturities of our debt obligations. The timing and terms of any refinancing transactions will be subject to market conditions among other considerations. Additionally, we may, from time to time, and depending on market conditions and other factors, use proceeds from specific disposition transactions to retire our debt, as we have historically done from time to time.

As potential acquisitions or dispositions arise, we actively review such transactions against our objectives including, among other considerations, improving our operational efficiency, geographic clustering of assets, product development or technology capabilities of our business and achieving appropriate strategic objectives, and we may participate in such transactions to the extent we believe these possibilities present attractive opportunities. However, there can be no assurance that we will actually complete any acquisitions or dispositions, or that any such transactions will be material to our operations or results.

Our ability to fund operations, make capital expenditures, repay debt obligations and make future acquisitions and strategic investments depends on future operating performance and cash flows, which are subject to prevailing economic conditions and to financial, business and other factors, including the impact of COVID-19, some of which are beyond our control.

Historical Operating, Investing, and Financing Activities

Operating Activities

Net cash provided by operating activities increased from $52.4 million for the three months ended March 31, 2020 to $77.6 million for the three months ended March 31, 2021. The increase is primarily due to timing differences of our receivables and payables.

23

Investing Activities

Net cash used in investing activities was $59.1 million for the three months ended March 31, 2020 and $58.9 million for the three months ended March 31, 2021. The change is attributable to a slight increase in capital expenditures partially offset by an increase in other investing activities.

We have ongoing capital expenditure requirements related to the maintenance, expansion and technological upgrades of our network. Capital expenditures are funded primarily through a combination of cash on hand and cash flow from operations. Our capital expenditures were $59.3 million and $58.0 million for the three months ended March 31, 2021 and 2020, respectively. The $1.3 million increase from the three months ended March 31, 2020 to the three months ended March 31, 2021 is primarily related to network enhancements focused on increasing bandwidth capacity, standardization and reliability to meet the needs of our customers. These increases are partially offset by decreased expenditures related to customer premise equipment (“CPE”) and edge-outs.

The following table sets forth additional information regarding our capital expenditures for the periods presented:

	Three months ended
	March 31,
	2021		2020
Capital Expenditures	(in millions)
Customer premise equipment(1)	$	30.6	$	34.8
Scalable infrastructure(2)		12.4		5.8
Line extensions(3)		4.9		5.6
Support capital and other(4)		11.4		11.8
Total	$	59.3	$	58.0
Capital expenditures included in total related to:
Edge-outs(5)	$	1.4	$	3.1
Business services(6)	$	5.0	$	5.6

(1) Customer premise equipment, or CPE, includes equipment and installation costs incurred to deliver services to residential and business services customers. CPE includes the costs of acquiring and installing our set-top boxes and modems, as well as the cost of customer connections to our network.

(2) Scalable infrastructure includes costs, not directly related to customer acquisition activity, to support new customer growth and provide service enhancements (e.g., headend equipment).

(3) Line extensions include costs associated with new home development within our footprint and edge-outs (e.g., fiber / coaxial cable, amplifiers, electronic equipment, make-ready and design engineering).

(4) Support capital and other includes costs to modify or replace existing HFC network, including enhancements, and all other costs to support day-to-day operations, including land, buildings, vehicles, office equipment, tools and test equipment.

(5) Edge-outs represent costs to extend our network into new adjacent service areas, including the associated CPE.

(6) Business services represent costs associated with the build-out of our network to support business services customers, including the associated CPE.

Financing Activities

Net cash provided by financing activities decreased from $22.5 million for the three months ended March 31, 2020 to $5.0 million for the three months ended March 31, 2021. The decrease is primarily due to a decrease in net borrowings of $11.6 million during the three months ended March 31, 2021 compared to the three months ended March 31, 2020, combined with the increase in share purchases associated with the annual vesting of the long-term equity incentive program for eligible employees.  

24

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our exposure to market risk is limited and primarily related to fluctuating interest rates associated with our variable rate indebtedness under our Senior Secured Credit Facility. As of March 31, 2021, borrowings under our Term B Loans and Revolving Credit Facility bear interest at our option at a rate equal to either an adjusted LIBOR rate (which is subject to a minimum rate of 1.00% for Term B Loans) or an ABR (which is subject to a minimum rate of 1.00% for Term B Loans), plus the applicable margin. The applicable margins for the Term B Loans is 3.25% for adjusted LIBOR loans and 2.25% for ABR loans. The applicable margin for borrowings under the Revolving Credit Facility is 3.00% for adjusted LIBOR loans and 2.00% for ABR loans. We manage the impact of interest rate changes on earnings and operating cash flows by entering into derivative instruments to protect against increases in the interest rates on our variable rate debt. We use interest rate swaps, where we receive variable rate amounts in exchange for fixed rate payments. As of March 31, 2021, after considering our interest rate swaps, approximately 40% of our Senior Secured Credit Facility is still variable rate debt. A hypothetical 100 basis point (1%) change in LIBOR interest rates (based on the interest rates in effect under our Senior Secured Credit Facility as of March 31, 2021) would result in an annual interest expense change of up to approximately $9.4 million on our Senior Secured Credit Facility.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer (together, the “Certifying Officers”), as appropriate, to allow for timely decisions regarding required disclosure.

In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance, not absolute assurance of achieving the desired objectives. Also, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Our management, with the participation of the Certifying Officers, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of March 31, 2021. Based on these evaluations, the Chief Executive Officer and the Chief Financial Officer concluded that our disclosure controls and procedures required by paragraph (b) of Rule 13a-15 or 15d-15 were effective as of March 31, 2021 and represent in all material respects our financial position, results of operations, cash flows and changes in shareholders’ deficit as of and for the periods presented in accordance with U.S. GAAP.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the first quarter of 2021.

25

PART II

Item 1. Legal Proceedings

Refer to Note 12 – Commitments and Contingencies for a discussion of the Company’s legal proceedings.

Item 1A. Risk Factors

Our Annual Report on Form 10-K for the year ended December 31, 2020 includes “Risk Factors” under Item 1A of Part 1.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer

The following table presents WOW’s purchases of equity securities completed during the first quarter of 2021 (in millions, except share and per share amounts):

					Approximate Dollar Value of
				Total Number of Shares	Shares that May Yet be
	Number of Shares	Average Price		Purchased as Part of Publicly	Purchased Under the Plans
Period	Purchased (1)	Paid per Share		Announced Plans or Programs	or Programs
January 1 - 31, 2021	4,012	$	10.65	—	$	—
February 1 - 28, 2021	589	$	14.05	—	$	—
March 1 - 31, 2021	392,585	$	16.65	—	$	—

(1) Shares represent shares withheld from employees for the payment of taxes upon the vesting of restricted stock awards.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

26

Item 6. Exhibits

Exhibit Number	Exhibit Description
31.1*	Certification of Chief Executive Officer pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Chief Financial Officer pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following financial information from WideOpenWest, Inc.’s Quarterly Report on Form 10-Q for the three months ended March 31, 2021, filed with the Securities and Exchange Commission on May 4, 2021, formatted in iXBRL (inline eXtensible Business Reporting Language) includes: (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Operations; (iii) the Condensed Consolidated Statements of Comprehensive (Loss) Income; (iv) the Condensed Consolidated Statements of Changes in Stockholders’ Deficit; (v) the Condensed Consolidated Statements of Cash Flows; and (vi) the Notes to the Condensed Consolidated Financial Statements.
104	Cover Page, formatted in iXBRL and contained in Exhibit 101.

* Filed herewith.

27

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	WIDEOPENWEST, INC.
May 4, 2021	By:	/s/ TERESA ELDER
		Teresa Elder
		Chief Executive Officer
	By:	/s/ JOHN REGO
		John Rego
		Chief Financial Officer

28

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to 15 U.S.C. Section 10A, as Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Teresa Elder, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of WideOpenWest, Inc. for the quarterly period ended March 31, 2021;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15 (e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 4, 2021	By:	/s/ TERESA ELDER
		Teresa Elder
		Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to 15 U.S.C. Section 10A, as Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, John Rego, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of WideOpenWest, Inc. for the quarterly period ended March 31, 2021;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15 (e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 4, 2021	By:	/s/ JOHN REGO
		John Rego
		Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification of Chief Executive Officer and Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of WideOpenWest, Inc. (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Teresa Elder, Chief Executive Officer and John Rego, Chief Financial Officer, of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

1.            The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.            The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

May 4, 2021	By:	/s/ TERESA ELDER
		Teresa Elder
		Chief Executive Officer
	By:	/s/ JOHN REGO
		John Rego
		Chief Financial Officer

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2021	Apr. 28, 2021
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity File Number	001-38101
Entity Registrant Name	WideOpenWest, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-0552948
Entity Address, Address Line One	7887 East Belleview Avenue
Entity Address, Address Line Two	Suite 1000
Entity Address, City or Town	Englewood
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80111
City Area Code	720
Local Phone Number	479-3500
Title of 12(b) Security	Common Stock
Trading Symbol	WOW
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		87,123,394
Entity Central Index Key	0001701051
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Mar. 31, 2021		Dec. 31, 2020
Current assets
Cash and cash equivalents	$ 36.1		$ 12.4
Accounts receivable-trade, net of allowance for doubtful accounts of $9.1 and $8.6, respectively	58.5		69.5
Accounts receivable-other, net	3.0		3.7
Prepaid expenses and other	39.7		29.2
Total current assets	137.3		114.8
Right-of-use lease assets-operating	23.6		24.9
Property, plant and equipment, net	1,098.3		1,100.3
Franchise operating rights	785.5		785.5
Goodwill	408.8		408.8
Intangible assets subject to amortization, net	2.0		2.1
Other non-current assets	49.6		50.6
Total assets	2,505.1		2,487.0
Current liabilities
Accounts payable-trade	47.1		43.8
Accrued interest	3.6		4.0
Current portion of long-term lease liability-operating	6.6		6.5
Accrued liabilities and other	86.6		98.6
Current portion of long-term debt and finance lease obligations	38.4		37.5
Current portion of unearned service revenue	46.3		45.5
Total current liabilities	228.6		235.9
Long-term debt and finance lease obligations, net of debt issuance costs -less current portion	2,243.2		2,228.5
Long-term lease liability-operating	19.9		21.3
Deferred income taxes, net	202.1		200.6
Other non-current liabilities	13.3		13.1
Total liabilities	2,707.1		2,699.4
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $0.01 par value, 100,000,000 shares authorized; 0 shares issued and outstanding
Common stock, $0.01 par value, 700,000,000 shares authorized; 95,853,288 and 95,187,161 issued as of March 31, 2021 and December 31, 2020, respectively; 87,116,738 and 86,847,797 outstanding as of March 31, 2021 and December 31, 2020, respectively	1.0		1.0
Additional paid-in capital	336.9		333.8
Accumulated other comprehensive loss	(2.2)		(6.5)
Accumulated deficit	(450.4)		(460.0)
Treasury stock at cost, 8,736,550 and 8,339,364 shares as of March 31, 2021 and December 31, 2020, respectively	(87.3)		(80.7)
Total stockholders' deficit	(202.0)	[1]	(212.4)
Total liabilities and stockholders' deficit	$ 2,505.1		$ 2,487.0

[1] Included in outstanding shares as of March 31, 2021 are 4,423,885 non-vested shares of restricted stock awards granted to employees and directors.

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020
CONDENSED CONSOLIDATED BALANCE SHEETS
Accounts receivable-trade, allowance for doubtful accounts	$ 9.1	$ 8.6
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding ( in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	700,000,000	700,000,000
Common stock, shares issued (in shares)	95,853,288	95,187,161
Common stock, shares outstanding ( in shares)	87,116,738	86,847,797
Common shares held in treasury, (in shares)	8,736,550	8,339,364

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Revenue	$ 286.3	$ 284.5
Costs and expenses:
Operating (excluding depreciation and amortization)	138.0	148.5
Selling, general and administrative	45.2	46.8
Depreciation and amortization	61.8	55.8
Total costs and expenses	245.0	251.1
Income from operations	41.3	33.4
Other income (expense):
Interest expense	(31.4)	(33.5)
Gain on sale of assets, net		0.3
Other income, net	0.6	0.7
Income before provision for income tax	10.5	0.9
Income tax expense	(0.9)	(0.8)
Net income	$ 9.6	$ 0.1
Basic and diluted earnings per common share
Basic (in dollars per share)	$ 0.12	$ 0.00
Diluted (in dollars per share)	$ 0.11	$ 0.00
Weighted-average common shares outstanding
Basic (in shares)	82,031,043	81,037,633
Diluted (in shares)	85,629,983	81,536,813

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net income	$ 9.6	$ 0.1
Unrealized gain (loss) on derivative instrument, net of tax	4.3	(3.0)
Comprehensive income (loss)	$ 13.9	$ (2.9)

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) $ in Millions		Common Stock		Treasury Stock at Cost	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Total
Balances at beginning of period at Dec. 31, 2019		$ 0.9		$ (79.7)	$ 322.8	$ (15.5)	$ (474.4)	$ (245.9)
Balances at beginning of period (in shares) at Dec. 31, 2019		84,103,108
Increase (Decrease) in Stockholders' Deficit
Changes in accumulated other comprehensive gain (loss)						(3.0)		(3.0)
Stock-based compensation					2.7			2.7
Issuance of restricted stock, net (in shares)		2,858,421
Purchase of shares				(0.7)				(0.7)
Purchase of shares (in shares)		(199,520)
Net income (loss)							0.1	0.1
Balances at end of period at Mar. 31, 2020	[1]	$ 0.9		(80.4)	325.5	(18.5)	(474.3)	(246.8)
Balances at end of period (in shares) at Mar. 31, 2020	[1]	86,762,009
Balances at beginning of period at Dec. 31, 2020		$ 1.0		(80.7)	333.8	(6.5)	(460.0)	$ (212.4)
Balances at beginning of period (in shares) at Dec. 31, 2020		86,847,797						86,847,797
Increase (Decrease) in Stockholders' Deficit
Changes in accumulated other comprehensive gain (loss)						4.3		$ 4.3
Stock-based compensation					3.1			3.1
Issuance of restricted stock, net (in shares)		666,127
Purchase of shares				(6.6)				(6.6)
Purchase of shares (in shares)		(397,186)
Net income (loss)							9.6	9.6
Balances at end of period at Mar. 31, 2021	[2]	$ 1.0		$ (87.3)	$ 336.9	$ (2.2)	$ (450.4)	$ (202.0)
Balances at end of period (in shares) at Mar. 31, 2021		87,116,738	[2]					87,116,738

[1] Included in outstanding shares as of March 31, 2020 are 5,292,277 non-vested shares of restricted stock awards  granted to employees and directors.

[2] Included in outstanding shares as of March 31, 2021 are 4,423,885 non-vested shares of restricted stock awards granted to employees and directors.

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT (Parenthetical) - shares	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Restricted stock awards
Number of shares granted to employees and directors	4,423,885	4,990,971	5,292,277

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Cash flows from operating activities:
Net income	$ 9.6	$ 0.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	61.8	55.8
Deferred income taxes	0.2	(0.1)
Provision for doubtful accounts	2.9	7.3
Gain on sale of assets, net		(0.3)
Amortization of debt issuance costs and discount	1.2	1.2
Non-cash compensation	3.1	2.7
Other non-cash items	(0.1)
Changes in operating assets and liabilities:
Receivables and other operating assets	(0.7)	(12.2)
Payables and accruals	(0.4)	(2.1)
Net cash provided by operating activities	77.6	52.4
Cash flows from investing activities:
Capital expenditures	(59.3)	(58.0)
Other investing activities	0.4	(1.1)
Net cash used in investing activities	(58.9)	(59.1)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	31.0	41.0
Payments on long-term debt and finance lease obligations	(19.4)	(17.8)
Purchase of shares	(6.6)	(0.7)
Net cash provided by financing activities	5.0	22.5
Increase in cash and cash equivalents	23.7	15.8
Cash and cash equivalents, beginning of period	12.4	21.0
Cash and cash equivalents, end of period	36.1	36.8
Supplemental disclosures of cash flow information:
Cash paid during the periods for interest	30.7	31.4
Non-cash operating activities
Operating lease additions	0.1	2.4
Non-cash financing activities:
Finance lease additions	2.8	1.2
Capital expenditure accounts payable and accruals	$ 17.0	$ 13.8

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General Information

3 Months Ended

Mar. 31, 2021

General Information

General Information

Note 1. General Information

WideOpenWest, Inc. (“WOW” or the “Company”) is a leading broadband services provider offering high-speed data (“HSD”), cable television (“Video”), and digital telephony (“Telephony”) services to residential and business customers. The Company serves customers in nineteen Midwestern and Southeastern markets in the United States. The Company manages and operates its Midwestern broadband networks in Detroit and Lansing, Michigan; Chicago, Illinois; Cleveland and Columbus, Ohio; Evansville, Indiana and Baltimore, Maryland. The Southeastern systems are located in Augusta, Columbus, Newnan and West Point, Georgia; Charleston, South Carolina; Dothan, Auburn, Huntsville and Montgomery, Alabama; Knoxville, Tennessee; and Panama City and Pinellas County, Florida.

The Company’s operations are managed and reported to its Chief Executive Officer (“CEO”), the Company’s chief operating decision maker, on a consolidated basis. The CEO assesses performance and allocates resources based on the consolidated results of operations. Under this organizational and reporting structure, the Company operates as one reportable segment.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2021

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission (“SEC”); however, in the opinion of management, the disclosures made are adequate to ensure the information presented is not misleading. The year-end consolidated balance sheet was derived from audited financial statements.

In the opinion of management, all normally recurring adjustments considered necessary for the fair presentation of the financial statements have been included, and the financial statements present fairly the financial position and results of operations for the interim periods presented. The results of operations for any interim period are not necessarily indicative of results expected for the full year or any future period. These unaudited condensed consolidated financial statements should be read in conjunction with the 2020 Annual Report filed with the SEC on February 24, 2021.

All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in accordance with GAAP requires management to make assumptions and estimates that affect the reported amounts and disclosures of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts and disclosures of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, including but not limited to the potential impacts arising from COVID-19. To the extent there are differences between those estimates and actual results, the unaudited condensed consolidated financial statements may be materially affected.

Recently Issued Accounting Standards

ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 provides optional guidance, expedients and exceptions for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in this update apply to all entities, subject to meeting the criteria, which participate in contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 was subsequently amended by ASU 2021-01, Reference Rate Reform (Topic  848), Scope, which refines the scope of Topic 848 and permits optional expendients and exceptions when accounting for derivative contracts and certain hedging relationships. The amendments of these updates are available to all entities as of March 12, 2020 through December 31, 2022. The Company has not yet adopted these amendments, but has determined the impact of adopting this guidance will not have a material impact on its financial position, results of operations and cash flows.

Recently Adopted Accounting Pronouncements

ASU 2019-12, Income Taxes—Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company adopted this guidance prospectively as of January 1, 2021. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows.

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Revenue from Contracts with Customers

3 Months Ended

Mar. 31, 2021

Revenue from Contracts with Customers

Revenue from Contracts with Customers

Note 3. Revenue from Contracts with Customers

Revenue by Service Offering

The following table presents revenue by service offering for the three months ended March 31, 2021 and 2020:

	Three months ended March 31, 2021						Three months ended March 31, 2020
	Residential		Business		Total			Residential		Business		Total
	Subscription		Subscription		Revenue			Subscription		Subscription		Revenue
	(in millions)
HSD	$	129.8	$	22.9	$	152.7	$	115.3	$	21.3	$	136.6
Video		89.6		3.7		93.3		99.5		3.9		103.4
Telephony		11.6		10.2		21.8		14.0		10.6		24.6
Total subscription services revenue	$	231.0	$	36.8	$	267.8	$	228.8	$	35.8	$	264.6
Other business services revenue(1)		—		—		6.2		—		—		6.5
Other revenue		—		—		12.3		—		—		13.4
Total revenue	$	231.0	$	36.8	$	286.3	$	228.8	$	35.8	$	284.5

(1) Includes wholesale and colocation revenue of $5.4 million for both the three months ended March 31, 2021 and 2020.

Costs of Obtaining Contracts with Customers

The following table summarizes the activity of costs of obtaining contracts with customers:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	49.6	$	40.7
Deferral		4.9		5.7
Amortization		(3.6)		(2.7)
Balance at end of period	$	50.9	$	43.7

The following table presents the current and non-current portion of costs of obtaining contracts with customers as of the end of the corresponding periods:

	March 31,  2021		December 31,  2020
	(in millions)
Current costs of obtaining contracts with customers	$	16.7	$	15.3
Non-current costs of obtaining contracts with customers		34.2		34.3
Total costs of obtaining contracts with customers	$	50.9	$	49.6

The current portion and the non-current portion of costs of obtaining contracts with customers are included in prepaid expenses and other and other non-current assets, respectively, in the Company’s unaudited condensed consolidated balance sheets. Amortization of costs of obtaining contracts with customers is included in selling, general and administrative expense in the Company’s unaudited condensed consolidated statements of operations.

Contract Liabilities

The following table summarizes the activity of current and non-current contract liabilities:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	4.2	$	4.2
Deferral		4.6		3.7
Revenue recognized		(4.2)		(4.0)
Balance at end of period	$	4.6	$	3.9

The following table presents the current and non-current portion of contract liabilities as of the end of the corresponding periods:

	March 31,  2021		December 31,  2020
	(in millions)
Current contract liabilities	$	4.0	$	3.6
Non-current contract liabilities		0.6		0.6
Total contract liabilities	$	4.6	$	4.2

The current portion and the non-current portion of contract liabilities are included in the current portion of unearned service revenue and other non-current liabilities, respectively, in the Company’s unaudited condensed consolidated balance sheets.

Unsatisfied Performance Obligations

Revenue from month-to-month residential subscription service contracts have historically represented a significant portion of the Company’s revenue and the Company expects that this will continue to be the case in future periods.  All residential subscription service performance obligations will be satisfied within one year.

A summary of expected business subscription and other business services revenue to be recognized in future periods related to performance obligations which have not been satisfied or are partially unsatisfied as of March 31, 2021 is set forth in the table below:

	2021		2022		2023		Thereafter		Total
	(in millions)
Subscription services	$	54.2	$	41.5	$	16.3	$	6.1	$	118.1
Other business services		2.8		2.1		0.7		0.1		5.7
Total expected revenue	$	57.0	$	43.6	$	17.0	$	6.2	$	123.8

Provision for Doubtful Accounts

The provision for doubtful accounts and the allowance for doubtful accounts are based on the aging of the individual receivables, historical trends and current and anticipated future economic conditions. The Company manages credit risk by disconnecting services to customers who are delinquent, generally after sixty days of delinquency. The individual receivables are written-off after all reasonable efforts to collect the funds have been made. Actual write-offs may differ from the amounts reserved.

The following table presents the change in the allowance for doubtful accounts for trade accounts receivable for the three months ended March 31, 2021 compared to the three months ended March 31, 2020:

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	8.6	$	7.5
Provision charged to expense		2.9		5.3
Accounts written off, net of recoveries		(2.4)		(3.8)
Balance at end of period	$	9.1	$	9.0

The Company established an allowance for doubtful accounts for non-trade accounts receivable of $2.0 million as of March 31, 2020 that is presented within accounts receivable—other in the Company’s unaudited condensed consolidated balance sheets. The Company did not have such an allowance as of March 31, 2021.

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Property, Plant and Equipment, Net

3 Months Ended

Mar. 31, 2021

Property, Plant and Equipment, Net

Property, Plant and Equipment, Net

Note 4. Plant, Property and Equipment, Net

Plant, property and equipment consists of the following:

	March 31,		December 31,
	2021		2020
	(in millions)
Distribution facilities	$	1,999.3	$	1,960.0
Customer premise equipment		488.1		481.5
Head-end equipment		369.8		364.3
Telephony infrastructure		99.0		99.3
Computer equipment and software		169.2		163.9
Vehicles		34.6		35.9
Buildings and leasehold improvements		49.8		49.7
Office and technical equipment		34.8		34.8
Land		6.2		6.2
Construction in progress (including material inventory and other)		50.4		50.5
Total property, plant and equipment		3,301.2		3,246.1
Less accumulated depreciation		(2,202.9)		(2,145.8)
	$	1,098.3	$	1,100.3

Depreciation expense for the three months ended March 31, 2021 and 2020 was $61.7 million and $55.4 million, respectively.

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Accrued Liabilities and Other

3 Months Ended

Mar. 31, 2021

Accrued Liabilities and Other

Accrued Liabilities and Other

Note 5. Accrued Liabilities and Other

Accrued liabilities and other consists of the following:

	March 31,		December 31,
	2021		2020
	(in millions)
Programming costs	$	32.4	$	30.0
Payroll and employee benefits		20.1		28.0
Other accrued liabilities		10.3		9.9
Franchise and revenue sharing fees		9.1		11.0
Property, income, sales and use taxes		7.0		5.8
Utility pole costs		3.9		4.5
Interest rate swaps		3.8		9.4
	$	86.6	$	98.6

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Long-Term Debt and Finance Leases

3 Months Ended

Mar. 31, 2021

Long-Term Debt and Finance Leases

Long-Term Debt and Finance Leases

Note 6. Long-Term Debt and Finance Leases

The following table summarizes the Company’s long-term debt and finance leases:

							December 31,
	March 31, 2021						2020
	Available
	borrowing		Effective		Outstanding		Outstanding
	capacity		interest rate(1)		balance		balance
	(in millions)
Long-term debt:
Term B Loans, net(2)	$	—	5.28	%	$	2,194.7	$	2,199.9
Revolving Credit Facility(3)		235.6	3.11	%		59.0		38.0
Total long-term debt	$	235.6				2,253.7		2,237.9
Other Financing						0.7		0.8
Finance lease obligations						32.2		32.9
Total long-term debt, finance lease obligations and other						2,286.6		2,271.6
Debt issuance costs, net(4)						(5.0)		(5.6)
Sub-total						2,281.6		2,266.0
Less current portion						(38.4)		(37.5)
Long-term portion					$	2,243.2	$	2,228.5

(1) Represents the effective interest rate in effect for all borrowings outstanding as of March 31, 2021 pursuant to each debt instrument including the applicable margin.

(2) At March 31, 2021 and December 31, 2020 includes $5.5 million and $6.1 million of net discounts, respectively.

(3) Available borrowing capacity at March 31, 2021 represents $300.0 million of total availability less borrowing of $59.0 million on the Revolving Credit Facility and outstanding letters of credit of $5.4 million. Letters of credit are used in the ordinary course of business and are released when the respective contractual obligations have been fulfilled by the Company.

(4) At March 31, 2021 and December 31, 2020, debt issuance costs include $4.0 million and $4.4 million related to Term B Loans and $1.0 million and $1.2 million related to the Revolving Credit Facility, respectively.

The Company’s Term B Loans will mature on August 19, 2023 and bear interest, at the Company’s option, at a rate equal to ABR plus 2.25% or LIBOR plus 3.25%. Borrowings under the revolving credit facility will mature on May 31, 2022 and bear interest, at the Company's option, at a rate equal to ABR plus 2.00% or LIBOR plus 3.00%. As of March 31, 2021, the Company was in compliance with all debt covenants.

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Stock-Based Compensation

3 Months Ended

Mar. 31, 2021

Stock-Based Compensation

Stock-Based Compensation

Note 7. Stock-Based Compensation

WOW’s 2017 Omnibus Incentive Plan provides for grants of stock options, restricted stock and performance awards. The Company’s directors, officers and other employees and persons who engage in services for the Company are eligible for grants under the 2017 Omnibus Incentive Plan. The 2017 Omnibus Incentive Plan has authorized 12,074,128 shares of common stock to be available for issuance, subject to adjustment in the event of a reorganization, stock split, merger or similar change in the Company’s corporate structure of the outstanding shares of common stock.  

The following table presents restricted stock activity during the three months ended March 31, 2021:

	Number of
	Unvested
	Restricted Stock
	Shares
Outstanding, beginning of period	4,990,971
Granted	767,689
Vested	(1,233,213)
Forfeited	(101,562)
Outstanding, end of period(1)	4,423,885

(1) The total outstanding non-vested shares of restricted stock awards granted to employees and directors are included in total outstanding shares as of March 31, 2021.

For restricted stock awards that contain only service conditions for vesting, the Company calculates the award fair value based on the closing stock price on the accounting grant date. Restricted stock generally vests ratably over a four year period based on the date of grant.

Nonvested Performance Shares

On March 3, 2021, the Company granted 209,621 performance shares which will vest based on the Company’s achievement level relative to the following performance measures at December 31, 2023: 50% based upon the Company’s Total Shareholder Return (“TSR”) relative to the TSRs of the Company’s peer group and 50% based on the Company’s three-year cumulative EBITDA metric. EBITDA is defined as net income (loss) before net interest expense, income taxes, depreciation and amortization (including impairments), impairment losses on intangibles and goodwill, management fees to related party, the write-off of any asset, loss on early extinguishment of debt, integration and restructuring expenses and all non-cash charges and expenses (including stock compensation expense) and certain other income and expenses. Upon achievement of the minimum threshold performance metric, the grantee may earn 50% to 200% of their respective target shares based on the performance goal.  

The performance shares based on relative TSR performance have a market condition and are valued using a Monte Carlo simulation model on the grant date, which resulted in a grant date fair value of $27.76 per share. The estimated fair value is amortized to expense over the requisite service period, which ends on December 31, 2023. The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the performance shares with a market condition: risk-free interest rate of 0.26%, volatility factors in the expected market price of the Company's common shares of 59.77% and an expected life of three years.

The performance shares based on three-year cumulative EBITDA have a performance condition. The probability of achieving the performance condition is assessed at each reporting period. If it is deemed probable that the performance condition will be met, compensation cost will be recognized based on the closing price per share of the Company's common stock on the date of the grant multiplied by the number of awards expected to be earned. If it is deemed that it is not probable that the performance condition will be met, the Company will discontinue the recognition of compensation cost and any compensation cost previously recorded will be reversed. At March 31, 2021, achievement of the performance condition for the performance shares was deemed probable.

The Company recorded $3.1 million and $2.7 million for the three months ended March 31, 2021 and 2020, respectively, of non-cash stock-based compensation expense which is reflected in selling, general and administrative expense in the Company’s unaudited condensed consolidated statements of operations.

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Earnings (Loss) per Common Share

3 Months Ended

Mar. 31, 2021

Earnings (Loss) per Common Share

Earnings (Loss) per Common Share

Note 8. Earnings per Common Share

Basic earnings or loss per share attributable to the Company’s common stockholders is computed by dividing net income or loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings or loss per share attributable to common stockholders presents the dilutive effect, if any, on a per share basis of potential common shares (such as restricted stock units) as if they had been vested or converted during the periods presented.

	Three months ended
	March 31,
	2021		2020
	(in millions, except share data)
Net income	$	9.6	$	0.1
Basic weighted-average shares		82,031,043		81,037,633
Effect of dilutive securities:
Restricted stock awards		3,598,940		499,180
Diluted weighted-average shares		85,629,983		81,536,813
Basic earnings per share	$	0.12	$	0.00
Diluted earnings per share	$	0.11	$	0.00

The dilutive effect of the potential common shares from the performance shares is included in diluted earnings per share upon the satisfaction of certain performance and market conditions. These conditions are evaluated at each reporting period and if the conditions have been satisfied during the reporting period, the number of contingently issuable shares are included in the computation of diluted earnings per share. As of March 31, 2021, the Company determined the performance conditions were not yet achieved; however, the market conditions indicated a certain level of  achievement within the payout range. Therefore, the contingently issuable performance shares associated with the market condition were included in the computation of diluted earnings per share.

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Fair Value Measurements

3 Months Ended

Mar. 31, 2021

Fair Value Measurements

Fair Value Measurements

Note 9. Fair Value Measurements

The fair values of cash and cash equivalents, receivables and trade payables approximate their carrying values due to the short-term nature of these instruments. For assets and liabilities of a long-term nature, the Company determines fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Market or observable inputs are the preferred source of values, followed by unobservable inputs or assumptions based on hypothetical transactions in the absence of market inputs. The Company applies the following hierarchy in determining fair value:

● Level 1, defined as observable inputs being quoted prices in active markets for identical assets;

● Level 2, defined as observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

● Level 3, defined as values determined using models that utilize significant unobservable inputs for which little or no market data exists, discounted cash flow methodologies or similar techniques, or other determinations requiring significant management judgment or estimation.

The Company’s derivative instrument is accounted for at fair value on a recurring basis and classified within Level 2 of the valuation hierarchy and was valued at $3.8 million and $9.4 million as of March 31, 2021 and December 31, 2020, respectively. The fair value of the derivative instrument is measured as the present value of all expected future cash flows based on the LIBOR-based swap yield curves as of March 31, 2021. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparties.

The estimated fair value of the Company’s long-term debt is based on dealer quotes considering current market rates for the Company’s credit facility and is classified as Level 2. The inputs used to determine the fair value of the Company’s aggregate debt balance has trended from quoted market prices in active markets to quoted prices in non-active markets. The fair value of the Company’s long-term debt was valued at $2,200.2 million and $2,203.1 million as of  March 31, 2021 and December 31, 2020, respectively. Long-term debt fair value does not include debt issuance costs and discounts.

There were no transfers into or out of Level 1, 2 or 3 during the periods ended March 31, 2021 and December 31, 2020.

The Company’s nonfinancial assets such as franchise operating rights, property, plant, and equipment, and other intangible assets are not measured at fair value on a recurring basis; however, they are subject to fair value adjustments in certain circumstances, such as when there is evidence that an impairment may exist.  When such impairments are recorded, fair values are generally classified within Level 3 of the valuation hierarchy.

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Derivative Instruments and Hedging Activities

3 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

Note 10. Derivative Instruments and Hedging Activities

The Company is exposed to certain risks during the normal course of its business arising from adverse changes in interest rates. The Company selectively uses derivative financial instruments (“derivatives”), including interest rate swaps, to manage interest rate risk. The Company does not hold or issue derivative instruments for speculative purposes. Fluctuations in interest rates can be volatile, and the Company’s risk management activities do not totally eliminate these risks. Consequently, these fluctuations could have a significant effect on the Company’s financial results.

The Company’s exposure to interest rate risk results primarily from its variable rate borrowings. On May 9, 2018, the Company entered into variable to fixed interest rate swap agreements for a notional amount of $1,361.2 million to hedge the outstanding principal balance of its variable rate term loan debt.

As of March 31, 2021, the Company is the fixed rate payor on two interest rate swap contracts that effectively fix the LIBOR-based index used to determine the interest rates charged on the Company’s total long-term debt of $2,259.2 million, not including unamortized debt issuance costs and discount. These contracts fix approximately 60% of the Company’s term loan variable rate exposure at 2.7% and have an expiration date of May 2021. These swap agreements qualify as hedging instruments and have been designated as cash flow hedges of forecasted LIBOR-based interest payments. As all of the critical terms of each of the derivative instruments matched the underlying terms of the hedged debt and related forecasted interest payments, these hedges were considered highly effective. Based on LIBOR-based swap yield curves as of March 31, 2021, the Company expects to reclassify losses of $3.8 million out of accumulated other comprehensive loss (“AOCL”) into earnings within the next 12 months.

The following table summarizes the notional amounts and fair values of the Company’s outstanding derivatives by risk category and instrument type within the unaudited condensed consolidated balance sheet as of March 31, 2021 and December 31, 2020:

			Fair Value
			Accrued
	Notional		Liabilities
	Amount		and Other
Derivatives Designated as Hedging Instruments	(in millions)
Interest rate swap contracts as of March 31, 2021	$	1,320.1	$	3.8
Interest rate swap contracts as of December 31, 2020	$	1,323.5	$	9.4

Gains and losses on derivatives designated as cash flow hedges included in the unaudited condensed consolidated statements of comprehensive income (loss) for the three months ended March 31, 2021 and 2020 are shown in the table below:

	Three months ended
	March 31,
	2021		2020
Interest rate swap contracts(1)	(in millions)
Gain (loss) recorded in AOCL on derivatives, before tax	$	5.6	$	(3.9)
Tax impact		(1.3)		0.9
Gain (loss) recorded in AOCL on derivatives, net		4.3		(3.0)

(1) Gains (losses) on derivatives reclassified from AOCL into income will be included in “Interest expense” in the unaudited condensed consolidated statements of operations, the same income statement line item as the earnings effect of the hedged item. Losses recognized in the unaudited condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 total $5.7 million and $3.8 million, respectively.

For the periods presented, all cash flows associated with derivatives are classified as operating cash flows in the unaudited condensed consolidated statements of cash flows.

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Income Taxes

3 Months Ended

Mar. 31, 2021

Income Taxes

Income Taxes

Note 11. Income Taxes

The Company accounts for income taxes under the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the difference is expected to reverse. Additionally, the impact on deferred tax assets and liabilities of changes in tax rates is reflected in the financial statements in the period that includes the date of enactment.

The Company reported income tax expense of $0.9 million and $0.8 million for the three months ended March 31, 2021 and 2020, respectively. The slight increase in expense is primarily related to an increase in income before tax while the lower effective income tax rate was primarily driven by the windfall deduction related to equity compensation, an increase in the research and development credit, and a decrease in state valuation allowance. The near breakeven income before tax for the three months ended March 31, 2020 resulted in tax adjustments having a larger impact on the effective tax rate as compared to the three months ended March 31, 2021.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2021

Commitments and Contingencies

Commitments and Contingencies

Note 12. Commitments and Contingencies

IPO Shareholder Class Action.  Beginning in June 2018, four different plaintiffs’ firms filed five separate class-action lawsuits against WOW, certain individual defendants, and the private equity sponsors and underwriters of the May 2017 initial public offering.  The actions allege violations of Sections 11, 12, and 15 of the 1933 Securities Act.  The three actions filed in New York have been consolidated as Kirkland. et al. v. WideOpenWest, Inc., et al., 653248/2018.  The other two actions, which were filed in Colorado state court, have been stayed by agreement until final resolution of the Kirkland action.  The Plaintiffs in Kirkland allege that Defendants made or caused misstatements to be made in the Registration Statement and Prospectus (“Offering Materials”) issued in connection with the IPO. On January 17, 2019, Defendants filed an omnibus motion to dismiss all claims for failure to state causes of action which the court denied in part and granted in part on May 18, 2020, with the Company thereafter appealing those claims not dismissed. Prior to an anticipated trial in 2022 or 2023, the parties undertook mediation on November 6, 2020 which, in turn, resulted in a soon-to-be-filed Stipulation of Settlement with the court.  Upon approval of the Court to the Stipulation of Settlement (which is expected in the second quarter of 2021), the Company will be dismissed entirely without any admission of wrongdoing in exchange for a payment of substantially less than that sought by plaintiffs, with the funding of such payment substantially from the Company’s primary D&O carrier.

Sprint Patent Infringement Claim.  On March 7, 2018, Sprint Communications Company L.P (“Sprint”) filed complaints in the U.S. District Court for the District of Delaware alleging that the Company (and other industry participants) infringe patents purportedly relating to Sprint’s Voice over Internet Protocol (“VoIP”) services. The lawsuit is part of a pattern of litigation that was initiated as far back as 2007 by Sprint against numerous broadband and telecommunications providers. The Company has multiple legal and contractual defenses and is vigorously defending against the claims. Additionally, the Company is pursuing indemnification claims against equipment providers whose equipment is implicated by the claims.  Formal discovery was completed in mid-February 2020, with the trial originally scheduled for October 2020, being moved to a yet to be determined date in the middle to second half of 2022.  The Company is unable at this time to determine whether the outcome of the litigation would have a material impact on the Company’s financial position, results of operations or cash flows.

The Company is party to various legal proceedings (including individual, class and putative class actions) arising in the normal course of its business covering a wide range of matters and types of claims including, but not limited to, general contracts, billing disputes, rights of access, programming, taxes, fees and surcharges, consumer protection, trademark and patent infringement, employment, regulatory, tort, claims of competitors and disputes with other carriers.

In accordance with GAAP, the Company accrues an expense for pending litigation when it determines that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. Legal defense costs are expensed as incurred. None of the Company’s existing accruals for pending matters are material. The Company consistently monitors its pending litigation for the purpose of adjusting its accruals and revising its disclosures accordingly, in accordance with GAAP, when required. However, litigation is subject to uncertainty, and the outcome of any particular matter is not predictable. The Company will vigorously defend its interests in pending litigation, and the Company believes that the ultimate resolution of all such matters, after considering insurance coverage or other indemnities to which it is entitled, will not have a material adverse effect on its consolidated financial position, results of operations, or cash flows.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2021

Summary of Significant Accounting Policies

Principles of Consolidation

Principles of Consolidation and Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission (“SEC”); however, in the opinion of management, the disclosures made are adequate to ensure the information presented is not misleading. The year-end consolidated balance sheet was derived from audited financial statements.

In the opinion of management, all normally recurring adjustments considered necessary for the fair presentation of the financial statements have been included, and the financial statements present fairly the financial position and results of operations for the interim periods presented. The results of operations for any interim period are not necessarily indicative of results expected for the full year or any future period. These unaudited condensed consolidated financial statements should be read in conjunction with the 2020 Annual Report filed with the SEC on February 24, 2021.

All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of financial statements in accordance with GAAP requires management to make assumptions and estimates that affect the reported amounts and disclosures of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts and disclosures of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, including but not limited to the potential impacts arising from COVID-19. To the extent there are differences between those estimates and actual results, the unaudited condensed consolidated financial statements may be materially affected.

Recently Issued Accounting Standards and Recently Adopted Accounting Pronouncements

Recently Issued Accounting Standards

ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). ASU 2020-04 provides optional guidance, expedients and exceptions for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in this update apply to all entities, subject to meeting the criteria, which participate in contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 was subsequently amended by ASU 2021-01, Reference Rate Reform (Topic  848), Scope, which refines the scope of Topic 848 and permits optional expendients and exceptions when accounting for derivative contracts and certain hedging relationships. The amendments of these updates are available to all entities as of March 12, 2020 through December 31, 2022. The Company has not yet adopted these amendments, but has determined the impact of adopting this guidance will not have a material impact on its financial position, results of operations and cash flows.

Recently Adopted Accounting Pronouncements

ASU 2019-12, Income Taxes—Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company adopted this guidance prospectively as of January 1, 2021. The adoption did not have a material impact on the Company’s financial position, results of operations or cash flows.

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Revenue from Contracts with Customers (Tables)

3 Months Ended

Mar. 31, 2021

Revenue from Contracts with Customers

Schedule of revenue by service offering

The following table presents revenue by service offering for the three months ended March 31, 2021 and 2020:

	Three months ended March 31, 2021						Three months ended March 31, 2020
	Residential		Business		Total			Residential		Business		Total
	Subscription		Subscription		Revenue			Subscription		Subscription		Revenue
	(in millions)
HSD	$	129.8	$	22.9	$	152.7	$	115.3	$	21.3	$	136.6
Video		89.6		3.7		93.3		99.5		3.9		103.4
Telephony		11.6		10.2		21.8		14.0		10.6		24.6
Total subscription services revenue	$	231.0	$	36.8	$	267.8	$	228.8	$	35.8	$	264.6
Other business services revenue(1)		—		—		6.2		—		—		6.5
Other revenue		—		—		12.3		—		—		13.4
Total revenue	$	231.0	$	36.8	$	286.3	$	228.8	$	35.8	$	284.5

(1) Includes wholesale and colocation revenue of $5.4 million for both the three months ended March 31, 2021 and 2020.

Schedule of activity and costs of current and non-current costs of obtaining contracts

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	49.6	$	40.7
Deferral		4.9		5.7
Amortization		(3.6)		(2.7)
Balance at end of period	$	50.9	$	43.7

	March 31,  2021		December 31,  2020
	(in millions)
Current costs of obtaining contracts with customers	$	16.7	$	15.3
Non-current costs of obtaining contracts with customers		34.2		34.3
Total costs of obtaining contracts with customers	$	50.9	$	49.6

Schedule of activity of contract liabilities and current and non-current portion of contract liabilities

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	4.2	$	4.2
Deferral		4.6		3.7
Revenue recognized		(4.2)		(4.0)
Balance at end of period	$	4.6	$	3.9

	March 31,  2021		December 31,  2020
	(in millions)
Current contract liabilities	$	4.0	$	3.6
Non-current contract liabilities		0.6		0.6
Total contract liabilities	$	4.6	$	4.2

Summary of expected revenue to be recognized in future periods related to performance obligations which have not been satisfied or are partially unsatisfied

	2021		2022		2023		Thereafter		Total
	(in millions)
Subscription services	$	54.2	$	41.5	$	16.3	$	6.1	$	118.1
Other business services		2.8		2.1		0.7		0.1		5.7
Total expected revenue	$	57.0	$	43.6	$	17.0	$	6.2	$	123.8

Schedule of change in the allowance for doubtful accounts for trade accounts receivable

	Three months ended
	March 31,
	2021		2020
	(in millions)
Balance at beginning of period	$	8.6	$	7.5
Provision charged to expense		2.9		5.3
Accounts written off, net of recoveries		(2.4)		(3.8)
Balance at end of period	$	9.1	$	9.0

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Property, Plant and Equipment, Net (Tables)

3 Months Ended

Mar. 31, 2021

Property, Plant and Equipment, Net

Schedule of property, plant and equipment

	March 31,		December 31,
	2021		2020
	(in millions)
Distribution facilities	$	1,999.3	$	1,960.0
Customer premise equipment		488.1		481.5
Head-end equipment		369.8		364.3
Telephony infrastructure		99.0		99.3
Computer equipment and software		169.2		163.9
Vehicles		34.6		35.9
Buildings and leasehold improvements		49.8		49.7
Office and technical equipment		34.8		34.8
Land		6.2		6.2
Construction in progress (including material inventory and other)		50.4		50.5
Total property, plant and equipment		3,301.2		3,246.1
Less accumulated depreciation		(2,202.9)		(2,145.8)
	$	1,098.3	$	1,100.3

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Accrued Liabilities and Other (Tables)

3 Months Ended

Mar. 31, 2021

Accrued Liabilities and Other

Schedule of accrued liabilities and other

	March 31,		December 31,
	2021		2020
	(in millions)
Programming costs	$	32.4	$	30.0
Payroll and employee benefits		20.1		28.0
Other accrued liabilities		10.3		9.9
Franchise and revenue sharing fees		9.1		11.0
Property, income, sales and use taxes		7.0		5.8
Utility pole costs		3.9		4.5
Interest rate swaps		3.8		9.4
	$	86.6	$	98.6

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Long-Term Debt and Finance Leases (Tables)

3 Months Ended

Mar. 31, 2021

Long-Term Debt and Finance Leases

Summary of long-term debt and finance leases

							December 31,
	March 31, 2021						2020
	Available
	borrowing		Effective		Outstanding		Outstanding
	capacity		interest rate(1)		balance		balance
	(in millions)
Long-term debt:
Term B Loans, net(2)	$	—	5.28	%	$	2,194.7	$	2,199.9
Revolving Credit Facility(3)		235.6	3.11	%		59.0		38.0
Total long-term debt	$	235.6				2,253.7		2,237.9
Other Financing						0.7		0.8
Finance lease obligations						32.2		32.9
Total long-term debt, finance lease obligations and other						2,286.6		2,271.6
Debt issuance costs, net(4)						(5.0)		(5.6)
Sub-total						2,281.6		2,266.0
Less current portion						(38.4)		(37.5)
Long-term portion					$	2,243.2	$	2,228.5

(1) Represents the effective interest rate in effect for all borrowings outstanding as of March 31, 2021 pursuant to each debt instrument including the applicable margin.

(2) At March 31, 2021 and December 31, 2020 includes $5.5 million and $6.1 million of net discounts, respectively.

(3) Available borrowing capacity at March 31, 2021 represents $300.0 million of total availability less borrowing of $59.0 million on the Revolving Credit Facility and outstanding letters of credit of $5.4 million. Letters of credit are used in the ordinary course of business and are released when the respective contractual obligations have been fulfilled by the Company.

(4) At March 31, 2021 and December 31, 2020, debt issuance costs include $4.0 million and $4.4 million related to Term B Loans and $1.0 million and $1.2 million related to the Revolving Credit Facility, respectively.

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Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2021

Stock-Based Compensation

Summary of the restricted stock awards activity

The following table presents restricted stock activity during the three months ended March 31, 2021:

	Number of
	Unvested
	Restricted Stock
	Shares
Outstanding, beginning of period	4,990,971
Granted	767,689
Vested	(1,233,213)
Forfeited	(101,562)
Outstanding, end of period(1)	4,423,885

(1) The total outstanding non-vested shares of restricted stock awards granted to employees and directors are included in total outstanding shares as of March 31, 2021.

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Earnings (Loss) per Common Share (Tables)

3 Months Ended

Mar. 31, 2021

Earnings (Loss) per Common Share

Schedule of computation of income per share

	Three months ended
	March 31,
	2021		2020
	(in millions, except share data)
Net income	$	9.6	$	0.1
Basic weighted-average shares		82,031,043		81,037,633
Effect of dilutive securities:
Restricted stock awards		3,598,940		499,180
Diluted weighted-average shares		85,629,983		81,536,813
Basic earnings per share	$	0.12	$	0.00
Diluted earnings per share	$	0.11	$	0.00

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Derivative Instruments and Hedging Activities (Tables)

3 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedging Activities

Schedule of notional amounts, fair values and classification of outstanding derivatives

			Fair Value
			Accrued
	Notional		Liabilities
	Amount		and Other
Derivatives Designated as Hedging Instruments	(in millions)
Interest rate swap contracts as of March 31, 2021	$	1,320.1	$	3.8
Interest rate swap contracts as of December 31, 2020	$	1,323.5	$	9.4

Schedule of gains and losses on derivatives

	Three months ended
	March 31,
	2021		2020
Interest rate swap contracts(1)	(in millions)
Gain (loss) recorded in AOCL on derivatives, before tax	$	5.6	$	(3.9)
Tax impact		(1.3)		0.9
Gain (loss) recorded in AOCL on derivatives, net		4.3		(3.0)

(1) Gains (losses) on derivatives reclassified from AOCL into income will be included in “Interest expense” in the unaudited condensed consolidated statements of operations, the same income statement line item as the earnings effect of the hedged item. Losses recognized in the unaudited condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 total $5.7 million and $3.8 million, respectively.

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Organization and Basis of Presentation - Markets and segments (Details)	3 Months Ended
	Mar. 31, 2021 item segment
General Information
Number of markets | item	19
Number of reportable segments | segment	1

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Revenue from Contracts with Customers - Revenue by Service Offering (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenue from Contracts with Customers
Total revenue	$ 286.3	$ 284.5
Subscription services
Revenue from Contracts with Customers
Revenue	267.8	264.6
HSD
Revenue from Contracts with Customers
Revenue	152.7	136.6
Video
Revenue from Contracts with Customers
Revenue	93.3	103.4
Telephony
Revenue from Contracts with Customers
Revenue	21.8	24.6
Other business services
Revenue from Contracts with Customers
Revenue	6.2	6.5
Other business services - Wholesale and colocation lease revenue
Revenue from Contracts with Customers
Revenue	5.4	5.4
Other services
Revenue from Contracts with Customers
Other revenue	12.3	13.4
Residential Subscription
Revenue from Contracts with Customers
Total revenue	231.0	228.8
Residential Subscription | Subscription services
Revenue from Contracts with Customers
Revenue	231.0	228.8
Residential Subscription | HSD
Revenue from Contracts with Customers
Revenue	129.8	115.3
Residential Subscription | Video
Revenue from Contracts with Customers
Revenue	89.6	99.5
Residential Subscription | Telephony
Revenue from Contracts with Customers
Revenue	11.6	14.0
Business Subscription
Revenue from Contracts with Customers
Total revenue	36.8	35.8
Business Subscription | Subscription services
Revenue from Contracts with Customers
Revenue	36.8	35.8
Business Subscription | HSD
Revenue from Contracts with Customers
Revenue	22.9	21.3
Business Subscription | Video
Revenue from Contracts with Customers
Revenue	3.7	3.9
Business Subscription | Telephony
Revenue from Contracts with Customers
Revenue	$ 10.2	$ 10.6

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Revenue from Contracts with Customers - Costs of Obtaining Contracts (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Mar. 31, 2021	Dec. 31, 2020
Revenue from Contracts with Customers
Capitalized contract cost, Beginning of period	$ 49.6	$ 40.7
Deferral	4.9	5.7
Amortization	(3.6)	(2.7)
Capitalized contract cost, End of period	50.9	43.7
Current costs of obtaining contracts with customers			$ 16.7	$ 15.3
Non-current costs of obtaining contracts with customers			34.2	34.3
Total costs of obtaining contracts with customers	$ 49.6	$ 43.7	$ 50.9	$ 49.6

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Revenue from Contracts with Customers - Contract Liabilities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Mar. 31, 2021	Dec. 31, 2020
Revenue from Contracts with Customers
Contract liability, Beginning of period	$ 4.2	$ 4.2
Deferral	4.6	3.7
Revenue recognized	(4.2)	(4.0)
Contract liability, End of period	4.6	3.9
Current contract liabilities			$ 4.0	$ 3.6
Non-current contract liabilities			0.6	0.6
Total contract liabilities	$ 4.2	$ 3.9	$ 4.6	$ 4.2

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Revenue from Contracts with Customers - Unsatisfied Performance Obligations Amount (Details) $ in Millions	Mar. 31, 2021 USD ($)
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 123.8
Subscription services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	118.1
Other business services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	5.7
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 57.0
Expected period to recognize revenue of remaining performance obligations	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01 | Maximum
Unsatisfied Performance Obligations
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01 | Subscription services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 54.2
Expected period to recognize revenue of remaining performance obligations	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-04-01 | Other business services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 2.8
Expected period to recognize revenue of remaining performance obligations	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 43.6
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Subscription services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 41.5
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | Other business services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 2.1
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 17.0
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | Subscription services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 16.3
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | Other business services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 0.7
Expected period to recognize revenue of remaining performance obligations	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 6.2
Expected period to recognize revenue of remaining performance obligations
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | Subscription services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 6.1
Expected period to recognize revenue of remaining performance obligations
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | Other business services
Unsatisfied Performance Obligations
Expected revenue to be recognized in future periods	$ 0.1
Expected period to recognize revenue of remaining performance obligations

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Revenue from Contracts with Customers - Provision for Doubtful Accounts (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Trade accounts receivable
Threshold period past due for trade accounts receivable for disconnecting service to customers	60 days
Change in the allowance for doubtful accounts
Balance at beginning of period	$ 8.6
Provision charged to expense	2.9	$ 7.3
Balance at end of period	9.1
Trade accounts receivable
Change in the allowance for doubtful accounts
Balance at beginning of period	8.6	7.5
Provision charged to expense	2.9	5.3
Accounts written off, net of recoveries	(2.4)	(3.8)
Balance at end of period	9.1	9.0
Non-trade accounts receivable
Change in the allowance for doubtful accounts
Balance at end of period	$ 0.0	$ 2.0

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Property, Plant and Equipment, Net - Components (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Property, Plant and Equipment, Net
Total property, plant and equipment	$ 3,301.2		$ 3,246.1
Less accumulated depreciation	(2,202.9)		(2,145.8)
Plant, Property and Equipment, Net	1,098.3		1,100.3
Depreciation expense	61.7	$ 55.4
Distribution facilities
Property, Plant and Equipment, Net
Total property, plant and equipment	1,999.3		1,960.0
Customer premise equipment
Property, Plant and Equipment, Net
Total property, plant and equipment	488.1		481.5
Head-end equipment
Property, Plant and Equipment, Net
Total property, plant and equipment	369.8		364.3
Telephony infrastructure
Property, Plant and Equipment, Net
Total property, plant and equipment	99.0		99.3
Computer equipment and software
Property, Plant and Equipment, Net
Total property, plant and equipment	169.2		163.9
Vehicles
Property, Plant and Equipment, Net
Total property, plant and equipment	34.6		35.9
Buildings and leasehold improvements
Property, Plant and Equipment, Net
Total property, plant and equipment	49.8		49.7
Office and technical equipment
Property, Plant and Equipment, Net
Total property, plant and equipment	34.8		34.8
Land
Property, Plant and Equipment, Net
Total property, plant and equipment	6.2		6.2
Construction in progress (including material inventory and other)
Property, Plant and Equipment, Net
Total property, plant and equipment	$ 50.4		$ 50.5

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Accrued Liabilities and Other (Details) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020
Accrued Liabilities and Other
Programming costs	$ 32.4	$ 30.0
Payroll and employee benefits	20.1	28.0
Other accrued liabilities	10.3	9.9
Franchise and revenue sharing fees	9.1	11.0
Property, income, sales and use taxes	7.0	5.8
Utility pole costs	3.9	4.5
Interest rate swaps	3.8	9.4
Accrued liabilities and other	$ 86.6	$ 98.6

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Long-Term Debt and Finance Leases - Summary (Details) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020
Long-Term Debt and Capital Leases
Available borrowing capacity	$ 235.6
Long-term debt	2,253.7	$ 2,237.9
Other Financing	0.7	0.8
Finance lease obligations	32.2	32.9
Total long-term debt, finance lease obligations and other	2,286.6	2,271.6
Debt issuance costs, net	(5.0)	(5.6)
Sub-total	2,281.6	2,266.0
Less current portion	(38.4)	(37.5)
Long-term portion	$ 2,243.2	2,228.5
Term B Loans
Long-Term Debt and Capital Leases
Effective interest rate (as a percent)	5.28%
Long-term debt	$ 2,194.7	2,199.9
Debt issuance costs, net	(4.0)	(4.4)
Net discount	5.5	6.1
Revolving Credit Facility
Long-Term Debt and Capital Leases
Available borrowing capacity	$ 235.6
Effective interest rate (as a percent)	3.11%
Long-term debt	$ 59.0	38.0
Debt issuance costs, net	(1.0)	$ (1.2)
Maximum borrowing capacity	300.0
Outstanding letters of credit	$ 5.4

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Long-Term Debt and Finance Leases - Term B Loans and Revolving Credit Facility (Details)	3 Months Ended
	Mar. 31, 2021
Term B Loans | Alternate base rate
Long-Term Debt and Capital Leases
Basis spread on variable rate (as a percent)	2.25%
Term B Loans | LIBOR rate
Long-Term Debt and Capital Leases
Basis spread on variable rate (as a percent)	3.25%
Revolving Credit Facility | Alternate base rate
Long-Term Debt and Capital Leases
Basis spread on variable rate (as a percent)	2.00%
Revolving Credit Facility | LIBOR rate
Long-Term Debt and Capital Leases
Basis spread on variable rate (as a percent)	3.00%

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Stock-Based Compensation - 2017 Plan (Details)	3 Months Ended
	Mar. 31, 2021 shares
Restricted stock awards
Stock Based Compensation
Vesting period	4 years
2017 Plan
Stock Based Compensation
Number of authorized shares	12,074,128

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Stock-Based Compensation - Restricted Stock Activity (Details) - Restricted stock awards	3 Months Ended
	Mar. 31, 2021 shares
Restricted Stock Awards
Outstanding, beginning of period (in shares)	4,990,971
Granted (in shares)	767,689
Vested (in shares)	(1,233,213)
Forfeited (in shares)	(101,562)
Outstanding, end of period (in shares)	4,423,885
Additional information
Vesting period	4 years

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Stock-Based Compensation - Performance Shares (Details) - Performance shares - $ / shares		3 Months Ended
	Mar. 03, 2021	Sep. 30, 2020
Stock Based Compensation
Granted (in shares)	209,621
Share-based Payment Arrangement, Tranche One, Total Shareholder Return
Stock Based Compensation
Vesting (as a percent)	50.00%
Grant date fair value (in dollars per share)	$ 27.76
Fair value assumptions
Risk-free interest rate (as a percent)	0.26%
Expected volatility (as a percent)	59.77%
Expected life	3 years
Share-based Payment Arrangement, Tranche Two, EBITDA metric
Stock Based Compensation
Vesting (as a percent)	50.00%
Vesting period	3 years	3 years
Minimum
Stock Based Compensation
Percentage of target shares that may be earned upon achievement of threshold performance metric	50.00%
Maximum
Stock Based Compensation
Percentage of target shares that may be earned upon achievement of threshold performance metric	200.00%

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Stock-Based Compensation - Expense (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Selling, general and administrative expense and operating expenses (excluding depreciation and amortization)
Stock-Based Compensation
Non-cash compensation expense	$ 3.1	$ 2.7

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Earnings (Loss) per Common Share (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Earnings (Loss) per Common Share
Net income	$ 9.6	$ 0.1
Basic weighted-average shares	82,031,043	81,037,633
Effect of dilutive securities:
Restricted stock awards	3,598,940	499,180
Diluted weighted-average shares	85,629,983	81,536,813
Basic earnings per share (in dollars per share)	$ 0.12	$ 0.00
Diluted earnings per share (in dollars per share)	$ 0.11	$ 0.00

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Fair Value Measurements (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Financial Liabilities
Transfer of assets from level 1 to level 2	$ 0.0	$ 0.0
Transfer of assets from level 2 to level 1	0.0	0.0
Transfer of liabilities from level 1 to level 2	0.0	0.0
Transfer of liabilities from level 2 to level 1	0.0	0.0
Transfer of assets into level 3	0.0	0.0
Transfer of assets out of level 3	0.0	0.0
Transfer of liabilities into level 3	0.0	0.0
Transfer of liabilities out of level 3	0.0	0.0
Significant other observable inputs (Level 2) | Recurring
Financial Liabilities
Derivative instrument	3.8	9.4
Liabilities	$ 2,200.2	$ 2,203.1

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Derivative Instruments and Hedging Activities - Summary (Details) - Cash flow hedging - Interest rate swaps $ in Millions	3 Months Ended
	Mar. 31, 2021 USD ($) item	Dec. 31, 2020 USD ($)	May 09, 2018 USD ($)
Interest Rate Hedge
Notional amount	$ 1,320.1	$ 1,323.5	$ 1,361.2
Number of interest rate swaps | item	2
Term loan variable rate exposure (as a percent)	60.00%
Fixed rate (as a percent)	2.70%
Carrying amount
Interest Rate Hedge
Long-term debt	$ 2,259.2
Reclassification of losses out of accumulated other comprehensive loss into earnings within next 12 months	$ 3.8

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Derivative Instruments and Hedging Activities - Notional amounts, fair values and classification (Details) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	May 09, 2018
Derivatives
Derivative current liabilities, fair value	$ 3.8	$ 9.4
Interest rate swaps | Cash flow hedging
Derivatives
Notional amount	1,320.1	1,323.5	$ 1,361.2
Interest rate swaps | Cash flow hedging | Accrued Liabilities and Other
Derivatives
Derivative current liabilities, fair value	$ 3.8	$ 9.4

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Derivative Instruments and Hedging Activities - Gains and losses on derivatives (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Gains and losses on derivatives
Gain (loss) recorded in AOCL on derivatives, net	$ 4.3	$ (3.0)
Cash flow hedging | Interest rate swaps
Gains and losses on derivatives
Gain (loss) recorded in AOCL on derivatives, before tax	5.6	(3.9)
Tax impact	(1.3)	0.9
Gain (loss) recorded in AOCL on derivatives, net	4.3	(3.0)
Gain (loss) on derivatives	$ (5.7)	$ (3.8)

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Income Taxes - Income tax expense (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Components of income tax benefit (expense) from continuing operations
Income tax expense	$ 0.9	$ 0.8

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Commitments and Contingencies - Legal (Details) - IPO Shareholder Class Action	Mar. 31, 2021 item
Commitments and contingencies
Number of plaintiff firms	4
Number of lawsuits	5
New York
Commitments and contingencies
Number of actions filed that have been consolidated	3
Colorado
Commitments and contingencies
Number of lawsuits	2