MEDIACOM COMMUNICATIONS CORP, 10-Q, 2000-11-14

MEDIACOM COMMUNICATIONS CORP
10-Q, 2000-11-14
CABLE & OTHER PAY TELEVISION SERVICES

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<PAGE>

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 September 30, 2000

Commission File Number: 0-29227

Mediacom Communications Corporation
(Exact name of Registrant as specified in its charter)

Delaware 06-1566067
(State of incorporation) (I.R.S. Employer
Identification Number)

100 Crystal Run Road
Middletown, NY 10941
(Address of principal executive offices)

(845) 695-2600
(Registrant's telephone number)

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 X No _____
-----

As of September 30, 2000, there were 60,601,001 shares of Class A common
stock and 29,342,990 shares of Class B common stock outstanding.
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

FORM 10-Q
FOR THE PERIOD ENDED SEPTEMBER 30, 2000

TABLE OF CONTENTS

PART I
------

<TABLE>
<CAPTION>
Page
----
<S> <C>
Item 1. Financial Statements

Consolidated Balance Sheets -
September 30, 2000 (unaudited) and December 31, 1999...................................... 1

Consolidated Statements of Operations -
Three and Nine Months Ended September 30, 2000 and 1999 (unaudited)....................... 2

Consolidated Statement of Changes in Stockholders' Equity -
September 30, 2000 (unaudited)............................................................ 3

Consolidated Statements of Cash Flows -
Nine Months Ended September 30, 2000 and 1999 (unaudited)................................. 4

Notes to Consolidated Financial Statements (unaudited)....................................... 5

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations................................................ 13

Item 3. Quantitative and Qualitative Disclosures about
Market Risk.................................................................................. 20

PART II
-------

Item 1. Legal Proceedings.............................................................................. 21

Item 6. Exhibits and Reports on Form 8-K............................................................... 21
</TABLE>
<PAGE>

Mediacom Communications Corporation, a Delaware corporation organized on
November 8, 1999, completed an initial public offering on February 9, 2000.
Prior to such time, Mediacom Communications Corporation had no assets,
liabilities, contingent liabilities or operations. Immediately prior to the
completion of its initial public offering, Mediacom Communications Corporation
issued shares of its Class A and Class B common stock in exchange for all of the
outstanding membership interests in Mediacom LLC, a New York limited liability
company. Upon completion of such exchange, Mediacom LLC became a wholly-owned
subsidiary of Mediacom Communications Corporation.

This Quarterly Report on Form 10-Q is for the three months ended September
30, 2000. References in this Quarterly Report to the "Company," "we," "us," or
"our" are to Mediacom Communications Corporation and its direct and indirect
subsidiaries since the initial public offering and to Mediacom LLC and its
direct and indirect subsidiaries prior to the initial public offering, unless
the context specifies or requires otherwise.

You should carefully review the information contained in this Quarterly
Report and in other reports or documents that we file from time to time with the
Securities and Exchange Commission (the "SEC"). In this Quarterly Report, we
state our beliefs of future events and of our future financial performance. In
some cases, you can identify those so-called "forward-looking statements" by
words such as "may," "will," "should," "expects," "plans," "anticipates,"
"believes," "estimates," "predicts," "potential," or "continue" or the negative
of those words and other comparable words. You should be aware that those
statements are only our predictions. Actual events or results may differ
materially. In evaluating those statements, you should specifically consider
various factors, including the risks discussed in this Quarterly Report, in our
Annual Report on Form 10-K for the year-ended December 31, 1999 and in our
definitive prospectus dated February 3, 2000. Those factors may cause our actual
results to differ materially from any of our forward-looking statements.

Factors Affecting Future Operations

We commenced operations in 1996 and have grown rapidly since then,
principally through acquisitions. We acquired a substantial portion of our cable
systems in 1998 and 1999. As a result, you have limited information upon which
to evaluate our performance in managing our current systems, and our historical
financial information may not be indicative of the future results we can achieve
with our systems. If we are unable to successfully integrate our newly acquired
cable systems or implement the technological upgrade of our systems, our growth
and profitability could be adversely affected.

In addition, the cable television industry may be affected by, among other
things:

. changes in laws and regulations;

. changes in the competitive environment;

. changes in the costs of programming we distribute;

. changes in the costs of upgrading our systems;

. changes in technology;

. franchise related matters;

. market conditions that may adversely affect the availability of
debt and equity financing for working capital, capital
expenditures or other purposes; and

. general economic conditions.
<PAGE>

PART I
------

ITEM 1. FINANCIAL STATEMENTS

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(All dollar amounts in 000's)

<TABLE>
<CAPTION>
September 30, December 31,
2000 1999
------------- ------------
ASSETS (Unaudited)
<S> <C> <C>
Cash and cash equivalents $ 3,024 $ 4,473
Subscriber accounts receivable, net of allowance for doubtful accounts
of $774 and $772, respectively 4,270 5,194
Prepaid expenses and other assets 4,979 4,376
Investments 9,796 8,794
Investment in cable television systems:
Inventory 13,759 12,384
Property, plant and equipment, at cost 847,438 700,696
Less - accumulated depreciation (185,054) (101,693)
------------ -----------
Property, plant and equipment, net 662,384 599,003
Intangible assets, net of accumulated amortization of $98,574 and
$56,171, respectively 570,036 588,103
------------ -----------
Total investment in cable television systems 1,246,179 1,199,490
Other assets, net of accumulated amortization of $8,433 and $6,343,
respectively 16,811 43,599
------------ -----------
Total assets $ 1,285,059 $ 1,265,926
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Debt $ 886,000 $ 1,139,000
Accounts payable and accrued expenses 63,228 57,183
Subscriber advances 1,852 3,188
Deferred revenue 34,217 11,940
------------ -----------
Total liabilities $ 985,297 $ 1,211,311
------------ -----------

STOCKHOLDERS' EQUITY
Class A common stock, $.01 par value; 300,000,000 shares authorized;
60,601,001 shares issued and outstanding as of September 30, 2000 606
Class B common stock, $.01 par value; 100,000,000 shares authorized;
29,342,990 shares issued and outstanding as of September 30, 2000 293
Additional paid in capital 538,126
Capital contributions - 182,013
Accumulated comprehensive (loss) income (15,705) 261
Accumulated deficit (223,558) (127,659)
------------ -----------
Total stockholders' equity 299,762 54,615
------------ -----------
Total liabilities and stockholders' equity $ 1,285,059 $ 1,265,926
============ ===========
</TABLE>

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

1
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(All amounts in 000's, except per share data)
(Unaudited)

Costs and expenses:
Service costs 28,947 12,396 83,813 36,571
Selling, general and
administrative expenses 13,889 7,314 41,171 21,816
Corporate expenses 1,598 1,562 4,529 5,150
Depreciation and amortization 45,100 24,723 129,251 66,154
Non-cash stock charges 609 27,596
----------- ---------- ----------- ----------
Operating loss (5,665) (6,943) (41,847) (16,461)
----------- ---------- ----------- ----------
Interest expense, net 16,864 7,185 51,444 20,577
Other expenses 353 245 1,224 979
----------- ---------- ----------- ----------
Net loss before income taxes $ (22,882) $ (14,373) $ (94,515) $ (38,017)
Provision for income taxes 83 1,384
----------- ---------- ----------- ----------
Net loss $ (22,965) $ (14,373) $ (95,899) $ (38,017)
=========== ========== =========== ==========
Basic and diluted loss per share $ (0.26) $ (1.82) $ (1.17) $ (4.82)
Weighted average common
shares outstanding 89,936 7,895 81,741 7,895
</TABLE>

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

2
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN
STOCKHOLDERS' EQUITY
(All dollar amounts in 000's)
(Unaudited)

<TABLE>
<CAPTION>
Class A Class B Additional Accumulated
Common Common Paid-In Capital Other Comprehensive Accumulated
Stock Stock Capital Contributions Equity Loss Deficit Total
------- ------- ---------- ------------- ------ ------------- ----------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1999 $ - $ - $ - $ 142,096 $ 39,917 $ 261 $(127,659) $ 54,615
Comprehensive loss:
Net loss - - - - - - (95,899)
Unrealized loss on investments,
net of deferred taxes - - - - - (15,966) -
Comprehensive loss (111,865)
Issuance of common stock in
exchange for membership interests 407 293 141,396 (142,096) - - - -
Issuance of common stock in initial
public offering 200 - 354,037 - - - - 354,237
Issuance of common stock in
employee stock purchase plan - - 310 - - - - 310
Repurchase of Class A common
stock (1) - (657) - - - - (658)
Non-cash expense related to
equity grant to employees - - 3,123 - - - - 3,123
Reclassification of equity to
paid-in-capital - - 39,917 - (39,917) - - -
----- ----- -------- ---------- -------- --------- --------- ---------
Balance, September 30, 2000 $ 606 $ 293 $538,126 $ - $ - $ (15,705) $(223,558) $ 299,762
===== ===== ======== ========== ======== ========= ========= =========
</TABLE>

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

3
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(All dollar amounts in 000's)
(Unaudited)

<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------
2000 1999
------------- -------------
<S> <C> <C>
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Net loss $ (95,899) $ (38,017)
Adjustments to reconcile net loss to net cash flows from operating
activities:
Accretion of interest on seller note - 225
Depreciation and amortization 129,251 66,154
Provision for deferred income taxes (1,346) -
Other non-cash charges 27,596 -
Other (947) -
Changes in assets and liabilities, net of effects from acquisitions:
Subscriber accounts receivable 1,055 243
Prepaid expenses and other assets (251) (1,235)
Accounts payable and accrued expenses 10,035 2,078
Subscriber advances (1,466) 347
Deferred revenue 354 -
----------- ------------
Net cash flows provided by operating activities 68,382 29,795
----------- ------------

CASH FLOWS USED IN INVESTING ACTIVITIES:
Capital expenditures (134,110) (60,245)
Acquisitions of cable television systems (34,968) -
Other, net (1,435) (387)
----------- ------------
Net cash flows used in investing activities (170,513) (60,632)
----------- ------------

CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
New borrowings 211,000 224,700
Repayment of debt (464,000) (185,330)
Net proceeds from sale of Class A common stock 354,237
Issuance of common stock in employee stock purchase plan 310
Repurchase of Class A common stock (658)
Financing costs (207) (7,045)
----------- ------------
Net cash flows provided by financing activities 100,682 32,325
----------- ------------
Net decrease in cash and cash equivalents (1,449) 1,488
CASH AND CASH EQUIVALENTS, beginning of period 4,473 2,212
----------- ------------
CASH AND CASH EQUIVALENTS, end of period $ 3,024 $ 3,700
----------- ------------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for interest $ 58,659 $ 16,438
=========== ============
</TABLE>

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

4
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

(1) Organization

Mediacom Communications Corporation ("MCC," and collectively with its
direct and indirect subsidiaries, the "Company") is involved in the acquisition
and development of cable television systems serving principally non-metropolitan
markets. Through these cable systems, the Company provides entertainment,
information and telecommunications services to its subscribers. As of September
30, 2000, the Company had acquired and was operating cable systems in 22 states,
principally Alabama, California, Florida, Illinois, Indiana, Iowa, Kentucky,
Minnesota, Missouri and North Carolina.

MCC, a Delaware corporation organized in November 1999, completed an
initial public offering on February 9, 2000. Prior to the initial public
offering, MCC had no assets, liabilities, contingent liabilities or operations.
Immediately prior to the completion of its initial public offering, MCC issued
shares of its Class A and Class B common stock in exchange for all of the
outstanding membership interests in Mediacom LLC, a New York limited liability
company organized in July 1995 that, prior to the initial public offering,
served as a holding company for certain operating subsidiaries. As a result of
this exchange, Mediacom LLC became a wholly-owned subsidiary of MCC and
continues to serve as the holding company for such operating subsidiaries. Each
operating subsidiary is wholly-owned by Mediacom LLC, except for a 1.0%
ownership interest in a subsidiary, Mediacom California LLC, that is held by
Mediacom Management Corporation ("Mediacom Management"), a Delaware corporation
that is wholly-owned by the Chairman and Chief Executive Officer of MCC.

(2) Statement of Accounting Presentation and Other Information

The consolidated financial statements presented for periods prior to the
initial public offering of MCC are the consolidated financial statements of
Mediacom LLC. Certain reclassifications have been made to the prior year's
presentation and amounts to conform to the current year's presentation and
amounts.

The consolidated financial statements as of September 30, 2000 and 1999 are
unaudited. However, in the opinion of management, such statements include all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair presentation of the results for the periods presented. The accounting
policies followed during such interim periods reported are in conformity with
generally accepted accounting principles and are consistent with those applied
during annual periods. For additional disclosures, including a summary of MCC's
accounting policies, the interim financial statements should be read in
conjunction with MCC's Annual Report on Form 10-K (File No. 0-29227). The
results of operations for the interim periods are not necessarily indicative of
the results that might be expected for future interim periods or for the full
year-ending December 31, 2000.

Recent Accounting Pronouncements

In June 1998, Statement of Financial Accounting Standards No. 133 ("SFAS
133"), "Accounting for Derivative Instruments and Hedging Activities," was
issued. This statement establishes the accounting and reporting standards for
derivatives and hedging activity. Upon adoption of SFAS No. 133, all derivatives
are required to be recognized in the statement of financial position as either
assets or liabilities and measured at fair value. In July 1999 and June 2000,
the Financial Accounting Standards Board issued SFAS No. 137 and SFAS No. 138
which deferred the effective date for implementation of SFAS No. 133 and which
addressed a limited number of issues causing implementation difficulties for
entities that apply SFAS No. 133, respectively. The Company is continuing to
evaluate the impact the adoption of SFAS No. 133, as amended, will have on its
financial position and results of operations.

On March 3, 1999, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 101 ("SAB 101"). SAB 101 summarizes certain areas
of the SEC's views in applying generally accepted accounting principles to
revenue recognition in financial statements. The Company does not expect SAB 101
to have a material impact on its results of operations and consolidated
financial statements.

5
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

In March 2000, the Financial Accounting Standards Board issued FASB
Interpretation No. 44, "Accounting for Certain Transactions Involving Stock
Compensation, an interpretation of APB Opinion No. 25" ("FIN 44"). FIN 44
clarifies the application of APB Opinion No. 25 and is effective July 1, 2000,
but certain conclusions in FIN 44 cover specific events as if they had occurred
after either December 15, 1998 or January 12, 2000. The Company does not expect
the application of FIN 44 to have a material impact on its financial statements.

(3) Acquisitions

The Company completed the undernoted acquisitions (the "Acquired Systems")
in 2000 and 1999. These acquisitions were accounted for using the purchase
method of accounting, and accordingly, the purchase price of each of these
Acquired Systems has been allocated to the assets acquired and liabilities
assumed at their estimated fair values at their respective dates of acquisition.
The results of operations of the Acquired Systems have been included with those
of the Company since the dates of acquisition.

2000

On April 6, 2000, the Company acquired the assets of cable television
systems owned by Rapid Communications Partners, L.P. ("Rapid") for a purchase
price of $8.0 million. The Rapid systems serve approximately 6,000 basic
subscribers primarily in Kentucky and Illinois.

On April 21, 2000, the Company acquired the assets of cable television
systems owned by MidAmerican Cable Systems, L.P. ("MidAmerican") for a purchase
price of approximately $8.0 million. The MidAmerican systems serve approximately
5,000 basic subscribers primarily in Illinois.

On May 25, 2000, the Company acquired the assets of cable television
systems owned by Tri Cable, Inc. ("Tri Cable") for a purchase price of
approximately $1.8 million. The Tri Cable systems serve approximately 1,000
basic subscribers in Minnesota.

On June 28, 2000, the Company acquired the assets of a cable television
system owned by Spirit Lake Cable TV, Inc. and E.M. Parsen ("Spirit Lake") for a
purchase price of approximately $10.8 million. The Spirit Lake system serves
approximately 5,000 basic subscribers primarily in Iowa.

On July 12, 2000, the Company acquired the assets of a cable television
system owned by South Kentucky Services Corporation ("South Kentucky") for a
purchase price of approximately $2.1 million. The South Kentucky system serves
approximately 1,000 basic subscribers primarily in Kentucky.

On August 31, 2000, the Company acquired the assets of cable television
systems owned by Dowden Midwest Cable Partners, L.P. ("Dowden") for a purchase
price of approximately $1.2 million. The Dowden systems serve approximately
1,000 basic subscribers primarily in Illinois.

The aggregate amount of the purchase prices stated above for the
acquisitions completed in 2000 have been allocated as follows: $15.5 million to
property, plant and equipment and $16.4 million to intangible assets.

1999

On October 15, 1999, the Company acquired the stock of Zylstra
Communications Corporation ("Zylstra") for a purchase price of approximately
$19.5 million. Zylstra owned and operated cable television systems serving
approximately 14,000 subscribers in Iowa, Minnesota and South Dakota. The
purchase price has been preliminarily allocated as follows: $7.8 million to
property, plant and equipment and $11.7 million to intangible assets. Such
allocations are subject to adjustments based upon the final appraisal
information received by the Company. The final

6
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

allocations of the purchase price are not expected to differ materially from the
preliminary allocations. Additionally, approximately $400,000 of direct
acquisition costs has been allocated to property, plant and equipment and
intangible assets. In the fourth quarter of 1999, the Company recorded
acquisition reserves related to this acquisition in the amount of approximately
$200,000, which are included in accrued expenses.

On November 5, 1999, the Company acquired the assets of cable television
systems owned by Triax Midwest Associates, L.P. ("Triax") for a purchase price
of approximately $740.1 million. The Triax systems served approximately 344,000
subscribers primarily in Illinois, Indiana, Iowa and Minnesota. The purchase
price has been preliminarily allocated as follows: $296.0 million to property,
plant and equipment and $444.1 million to intangible assets. Such allocations
are subject to adjustments based upon the final appraisal information received
by the Company. The final allocations of the purchase price are not expected to
differ materially from the preliminary allocations. Additionally, approximately
$10.5 million of direct acquisition costs has been allocated to property, plant
and equipment, intangible assets and other assets. In the fourth quarter of
1999, the Company recorded acquisition reserves related to this acquisition in
the amount of approximately $5.5 million, which are included in accrued
expenses.

The Company has reported the operating results of the Acquired Systems from
the dates of their respective acquisition. The unaudited pro forma operating
results presented below give pro forma effect to the acquisitions of the
Acquired Systems as if such transactions had been consummated on January 1,
1999. This financial information has been prepared for comparative purposes only
and does not purport to be indicative of the operating results which actually
would have resulted had the acquisitions of the Acquired Systems been
consummated at the beginning of the period presented.

<TABLE>
<CAPTION>
Pro Forma Results for the
Nine Months Ended September 30,
---------------------------------
2000 1999
------------ ------------
(dollars in thousands, except per
share amounts)
<S> <C> <C>
Revenues............................................................... $ 247,423 $ 226,423

Operating expenses and costs:
Service costs....................................................... 85,040 75,770
SG&A expenses....................................................... 41,754 40,720
Corporate expenses.................................................. 4,529 8,933
Depreciation and amortization....................................... 130,832 124,017
Non-cash stock charges.............................................. 27,596 -
----------- -----------
Operating loss......................................................... (42,328) (23,017)
----------- -----------
Net loss............................................................... $ (97,435) $ (87,811)
=========== ===========
Basic and diluted loss per share....................................... $ (1.19) $ (11.12)
</TABLE>

(4) Income Tax

The accompanying consolidated statements of operations for the nine months
ended September 30, 2000 include a provision for income taxes of approximately
$1.4 million. This provision reflects a one-time $1.2 million non-recurring,
non-cash charge that was recognized upon the exchange of outstanding membership
interests in Mediacom LLC for shares of MCC common stock. This charge relates to
the deferred tax liabilities associated with the differences between the
financial statements and the tax basis of the assets and liabilities of the
Company. Since

7
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Mediacom LLC, the predecessor company, was a New York limited liability company
and not subject to federal or state income taxes, no provision for income taxes
was recorded for the nine months ended September 30, 1999.

A reconciliation of the income tax provision at the United States federal
statutory rate to the actual income tax expense for the nine months ended
September 30, 2000 is as follows (dollars in thousands):

Tax benefit at the United States statutory rate......... $ (33,565)
State taxes, net of federal tax benefit................. 75
Other ............................................... 3,904
Losses not benefited.................................... 30,932
---------
Total income tax provision......................... $ 1,346
=========
The Company's net deferred tax liability consisted of the following amounts
of deferred tax assets and liabilities as of September 30, 2000 (dollars in
thousands):

Deferred tax assets:
Deferred revenue................................... $ 13,877
Tax over book basis of intangible assets .......... 13,810
Unrealized loss on marketable securities .......... 8,700
Reserves and other................................. 2,129
Net operating loss carryforwards................... 30,932
---------
Gross tax assets ....................................... 69,448

Less: Valuation allowance.......................... (35,297)
---------
Deferred tax assets..................................... $ 34,151

Deferred tax liabilities:
Book over tax basis of depreciable assets.......... $ 34,151
---------
Deferred tax liabilities................................ $ 34,151
---------
Net deferred tax liabilities............................ $ -
=========

(5) Loss Per Share

The Company calculates loss per share in accordance with Statement of
Financial of Accounting Standards No. 128 ("SFAS 128"), "Earnings per Share."
SFAS 128 computes basic loss per share by dividing the net loss by the weighted
average number of shares of common stock outstanding during the period. Diluted
loss per share is computed by dividing the net loss by the weighted average
number of shares of common stock outstanding during the period plus the effects
of any potentially dilutive securities. Since the Company is reporting a net
loss for the period, the inclusion of outstanding stock options would cause its
loss per share to decrease and therefore, in accordance with SFAS 128, these
options are not included in the computation of diluted loss per share.

8
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

The following table summarizes the Company's calculation of basic and
diluted loss per share for the three and nine months ended September 30, 2000
and 1999:

<TABLE>
<CAPTION>
Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- -------------------------------
2000 1999 2000 1999
------------ ------------ ------------ -----------
(in thousands, except per share amounts)
<S> <C> <C> <C> <C>
Net loss....................... $ (22,965) $ (14,373) $ (95,899) $ (38,017)
Basic and diluted loss
per share................. $ (0.26) $ (1.82) $ (1.17) $ (4.82)
Weighted average common
shares outstanding........ 89,936 7,895 81,741 7,895
</TABLE>

Except for the three months ended September 30, 2000, the weighted average
shares outstanding was computed based on the shares of MCC common stock
outstanding, if any, and the conversion ratio used to exchange the Mediacom LLC
membership units for shares of MCC common stock upon MCC's initial public
offering.

(6) Debt

As of September 30, 2000 and December 31, 1999, debt consisted of:

September 30, December 31,
2000 1999
------------- ------------
(dollars in thousands)
8 1/2% Senior Notes............... $ 200,000 $ 200,000
7 7/8% Senior Notes............... 125,000 125,000
Bank Credit Facilities............ 561,000 814,000
------------ ------------
$ 886,000 $ 1,139,000
============ ============

The average interest rate on outstanding debt under the bank credit
agreements was 8.1% and 8.2% as of September 30, 2000 and December 31, 1999,
respectively, before giving effect to the interest rate swap agreements
discussed below.

The Company uses interest rate swap agreements in order to fix the interest
rate for the duration of the contract as a hedge against interest rate
volatility. As of September 30, 2000, the Company had entered into interest rate
exchange agreements (the "Swaps") with various banks pursuant to which the
interest rate on $140.0 million is fixed at a weighted average swap rate of
approximately 6.8%, plus the average applicable margin over the Eurodollar Rate
option under the bank credit agreements. Under the terms of the Swaps, which
expire from 2002 through 2003, the Company is exposed to credit loss in the
event of nonperformance by the other parties to the Swaps. However, the Company
does not anticipate nonperformance by the counterparties.

The stated maturities of all debt outstanding as of September 30, 2000 are
as follows (dollars in thousands):

2001................................................ $ -
2002................................................ 750
2003................................................ 2,000
2004................................................ 2,000
2005................................................ 2,000
Thereafter ......................................... 879,250
------------
$ 886,000
============

9
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

(7) Stockholders' Equity

In May 2000, the Company announced that its Board of Directors had
authorized a repurchase program (the "Repurchase Program") pursuant to which the
Company may purchase up to $50.0 million of its Class A common stock, in the
open market or through privately negotiated transactions, subject to certain
restrictions and market conditions. During the second quarter of 2000, in
connection with the Repurchase Program, the Company repurchased 80,000 shares of
its Class A common stock for an aggregate cost of approximately $658,000 at
share prices ranging from $8.00 to $10.75 per share. The repurchased stock was
retired and resulted in a reduction of stockholders' equity.

As of December 20, 1999, the Board of Directors of the Company adopted the
1999 Employee Stock Purchase Plan ("ESPP"). Under this plan, all employees were
allowed to participate in the purchase of the Company's Class A Common Stock at
a 15% discount on the date of the allocation, as defined. On July 31, 2000,
approximately 24,000 shares were allocated to the participants of the ESPP.
Compensation was not recorded on the distribution of these shares in accordance
with Accounting Principles Board No. 25, "Accounting for Stock Issued to
Employees" ("APB 25").

(8) SoftNet

As of September 30, 2000 and December 31, 1999, deferred revenue resulting
from the Company's receipt of SoftNet Systems, Inc. shares of common stock
amounted to approximately $29.5 million and $8.4 million, respectively, net of
amortization taken. For the three and nine months ended September 30, 2000, the
Company recognized revenue of approximately $737,000 and $1.7 million,
respectively. The Company did not recognize any deferred revenue for the three
or nine month period ended September 30, 1999. The Company carries this
available-for-sale security at a market value of $9.8 million with a share price
of $5.97, as of September 30, 2000. The difference between this fair value and
the Company's original basis of $31.3 million for SoftNet's common stock is
recorded as unrealized loss in accumulated comprehensive loss. If the Company
determines that this decline in fair value is other than temporary, the decrease
in the original basis of the Company's SoftNet shares will be recorded as a
realized loss in other expenses in the consolidated statements of operations.

(9) Initial Public Offering

On February 9, 2000, MCC completed an initial public offering ("IPO") of
20,000,000 shares of Class A common stock at $19.00 per share. The net proceeds,
after underwriting discounts of approximately $22.8 million and estimated
expenses related to the offering of approximately $3.0 million, were $354.2
million. Immediately prior to the completion of the IPO, MCC issued 40,657,010
shares of Class A common stock and 29,342,990 shares of Class B common stock in
exchange for all the outstanding membership interests in Mediacom LLC. On
February 9, 2000, Mediacom LLC's Fourth Amended and Restated Operating Agreement
(the "1999 Operating Agreement") was amended to reflect MCC as the sole member
and manager of Mediacom LLC.

Immediately prior to the IPO, additional membership interests were issued
to all members of Mediacom LLC in accordance with a formula set forth in the
1999 Operating Agreement, which was based upon a valuation of Mediacom LLC
established at the time of the IPO (the "IPO Valuation"). A provision in the
1999 Operating Agreement eliminated a certain portion of the special allocation
of membership interests awarded to certain Mediacom LLC members (the "Primary
Members") based upon a valuation of Mediacom LLC. In connection with the removal
of these specified special allocation provisions and the amendments to Mediacom
LLC's management agreements with Mediacom Management effective November 19,
1999, the Primary Members were issued new membership interests in Mediacom LLC
immediately prior to the IPO representing 16.5% of the equity in Mediacom LLC.
These newly issued membership interests were exchanged for shares of MCC Class B
common stock immediately prior to the completion of the IPO.

In addition, immediately prior to the completion of the IPO, the Primary
Members received options to purchase 7,200,000 shares of Class B common stock in
exchange for the elimination of the balance of the provision providing for a
special allocation of membership interests in Mediacom LLC. These options have a
term of five years and are exercisable in August 2000, at a price equal to the
initial public offering price of $19.00. With the exception of such options held
by the MCC's Chairman and Chief Executive Officer to purchase approximately
6,900,000 shares of common stock, such options: (i) vest over five years which
vesting period is deemed to have commenced for these

10
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Primary Members on various dates prior to the IPO; and (ii) are subject to
forfeiture penalties to MCC's Chairman and Chief Executive Officer during the
three year period between the date the options become vested and the date the
Primary Member terminates employment with the Company.

The management agreements between Mediacom Management and each of MCC's
operating subsidiaries were terminated at the time of the IPO, and Mediacom
Management's employees became MCC's employees and its corporate expense became
MCC's corporate expense. The management fee expenses recorded prior to the IPO
are reflected as corporate expenses in the consolidated statements of
operations.

As a result of the IPO and the termination of the management agreements
with Mediacom Management, the deferred non-cash stock expense of $24.5 million,
net of amortization taken, relating to future benefits associated with the
continuation of such management agreements, was recognized in the first quarter
of 2000 as a non-cash stock charge in the consolidated statements of operations.
Mediacom Management is wholly-owned by the Chairman and Chief Executive Officer
of MCC.

(10) Stock Options

As of December 20, 1999, the Board of Directors of the Company adopted the
1999 Stock Option Plan for officers, directors and key employees. Options
granted under this plan have a ten-year duration and vest at various times over
a five-year period. Our Board of Directors authorized 9,000,000 shares of common
stock to be granted as options under this plan. A maximum of 7,000,000 of these
shares of common stock may be granted as incentive stock options. As of
September 30, 2000, options for 2,926,000 shares (the "Employee Options") had
been granted under the 1999 Stock Option Plan, consisting of 1,977,108 shares of
Class A common stock and 948,892 shares of Class B common stock. As of September
30, 2000, as noted above, additional options for 7,200,000 shares of Class B
common stock with a five-year duration had been issued to the Primary Members.
See Note 9.

The following table summarizes information concerning stock option activity
as of September 30, 2000:

Shares Price
------------ -----------
Outstanding at January 1, 2000................. - -
Granted........................................ 10,126,000 $ 19.00
Exercised...................................... - -
Forfeited...................................... (264,790) $ 19.00
---------- ---------
Outstanding at end of period................... 9,861,210 $ 19.00
========== =========
Options exercisable at end of period........... 8,187,041 $ 19.00
Weighted average fair value of options granted
during period................................ $ 8.13

Excluded from the weighted average fair value of options granted during the
period are the additional options issued to the Primary Members since these
options, as noted in Note 9, were issued in exchange for consideration
representing their fair value.

The weighted average remaining contractual life of the outstanding options
is 5.7 years.

MCC applied APB 25 in accounting for stock options granted to key employees
and directors. Accordingly, no compensation cost has been recognized for any
option grants in the accompanying statements of operations since the price of
the options was at their fair market value at the date of grant. FASB Statement
No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123"), requires that
information be determined as if the Company had accounted for employee stock
options under the fair value method of this statement, including disclosing pro
forma information

11
<PAGE>

MEDIACOM COMMUNICATIONS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

regarding net loss and loss per share. The fair value of all of the Employee
Options was estimated on the date of grant using the Black-Scholes model with
the following weighted average assumptions: (i) risk free interest rate of 6.7%;
(ii) expected dividend yields of 0%; (iii) expected lives of 6 years; and (iv)
expected volatility of 29%. Had compensation costs been recorded for the
Employee Options under SFAS 123, MCC's net loss and basic and diluted loss per
share would have been increased from the "as reported" amounts to the "pro
forma" amounts as follows:

Nine Months Ended September 30,
-------------------------------
2000 1999
----------- ------------
(in thousands, except per
share amounts)
Net loss:
As reported....................... $ (95,899) $ (38,017)
Pro forma......................... $ (103,622) $ (38,017)
Basic and diluted loss per share:

As reported....................... $ (1.17) $ (4.82)
Pro forma......................... $ (1.27) $ (4.82)

Excluded from the above pro forma calculation are the additional options
issued to the Primary Members since these options, as noted in Note 9, were
issued in exchange for consideration representing their fair value.

(11) Subsequent Events

On October 12, 2000, the Company acquired the stock and assets of cable
television systems owned by Illinet Communications of Central Illinois, LLC
("Illinet") for a purchase price of approximately $15.6 million. The Illinet
systems serve approximately 8,000 basic subscribers primarily in Illinois.

On October 19, 2000, SoftNet Systems, Inc. announced that it is
restructuring its wholly-owned ISP Channel subsidiary. ISP Channel is Mediacom's
turnkey provider of high-speed Internet access. In connection with these
developments, the Chairman and Chief Executive Officer of MCC resigned from the
SoftNet board of directors effective October 27, 2000.

On October 31, 2000, the Company acquired the assets of cable television
systems owned by Satellite Cable Services, Inc. ("Satellite") for a purchase
price of approximately $27.5 million. The Satellite systems serve approximately
12,000 basic subscribers primarily in South Dakota.

On November 3, 2000, the Company signed a definitive agreement to acquire
cable television systems serving approximately 14,000 basic subscribers for a
purchase price of approximately $34.0 million. The completion of this
acquisition is subject to a number of closing conditions, including regulatory
approvals and other third party consents and no assurance can be given that such
acquisition will be completed. The Company expects to complete this pending
acquisition by year-end 2000.

On November 3, 2000, the Company resolved litigation brought against it by
Grey Advertising, Inc. ("Grey") in January 2000. MCC and Grey entered into a
final settlement agreement that involves no monetary payments by either party
and that permits MCC and its subsidiaries to continue to use the name "Mediacom"
in accordance with the terms of their confidential agreement.

12
<PAGE>

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

Introduction

The following discussion of the financial condition and results of
operations of the Company, the description of the Company's business as well as
other sections of this Form 10-Q contain certain forward-looking statements. The
Company's actual results could differ materially from those discussed herein and
its current business plans could be altered in response to market conditions and
other factors beyond the Company's control.

EBITDA represents operating loss before depreciation and amortization and
non-cash stock charges. EBITDA:

. is not intended to be a performance measure that should be regarded as
an alternative either to operating income or net income as an
indicator of operating performance, or to the statement of cash flows
as a measure of liquidity;

. is not intended to represent funds available for debt service,
dividends, reinvestment or other discretionary uses; and

. should not be considered in isolation or as a substitute for measures
of performance prepared in accordance with generally accepted
accounting principles.

EBITDA is included herein because the Company's management believes that EBITDA
is a meaningful measure of performance as it is commonly used by the cable
television industry and by the investment community to analyze and compare cable
television companies. The Company's definition of EBITDA may not be identical to
similarly titled measures reported by other companies.

The Company was founded in July 1995 principally to acquire, operate and
develop cable television systems in selected non-metropolitan markets of the
United States. The Company's business strategy is to:

. improve the operating and financial performance of its acquired cable
systems;

. develop efficient operating clusters;

. rapidly upgrade its cable network;

. introduce new and enhanced products and services;

. maximize customer satisfaction to build customer loyalty;

. acquire underperforming cable television systems principally in non-
metropolitan markets; and

. implement a flexible financing structure.

The Company commenced operations in March 1996 with the acquisition of its
first cable television system. As of September 30, 2000, the Company had
completed 17 acquisitions of cable television systems that on such date passed
approximately 1,120,000 homes and served approximately 743,000 basic
subscribers. In October 1999, the Company purchased the outstanding stock of
Zylstra Communications Corporation ("Zylstra") serving 14,000 basic subscribers.
In November 1999, the Company acquired cable television systems from Triax
Midwest Associates, L.P. ("Triax"), serving 344,000 basic subscribers. During
the second and third quarters of 2000, the Company completed six acquisitions
serving a total of 19,000 basic subscribers in locations within the Company's
regional operating clusters (the "2000 Acquisitions," and together with Triax
and Zylstra systems the "Acquired Systems"). All acquisitions have been
accounted for under the purchase method of accounting and, therefore, the
Company's historical results of operations include the results of operations for
each acquired system subsequent to its respective acquisition date.

On October 19, 2000, SoftNet Systems, Inc. announced that it is
restructuring its wholly-owned ISP Channel subsidiary. ISP Channel is Mediacom's
turnkey provider of high-speed Internet access. The Company has not yet
determined the full effects of SoftNet's announcement and is having continuing
discussions with SoftNet regarding its plans for the ISP Channel. Mediacom is
also taking the necessary steps to ensure that the impact of this restructuring
on its high-speed Internet business will be minimal. These steps include
discussions with other providers of high-speed Internet services as well as
plans to bring those activities currently performed by ISP Channel under

13
<PAGE>

Mediacom's control. In connection with these developments, the Chairman and
Chief Executive Officer of MCC resigned from the SoftNet board of directors
effective October 27, 2000.

Actual Results of Operations

The following historical information includes the results of operations of
the Acquired Systems, only for that portion of the respective period that such
cable television systems were owned by the Company. See Note 3 to the Company's
consolidated financial statements for a detailed description of the Acquired
Systems.

Three Months Ended September 30, 2000 Compared to Three Months Ended
September 30, 1999

Revenues. Revenues increased 116.3% to approximately $84.5 million for the
three months ended September 30, 2000 as compared to $39.1 million for the three
months ended September 30, 1999. Of the revenue increase of $45.4 million, $41.0
million was attributable to the Acquired Systems. Excluding the Acquired
Systems, revenues increased 11.3% primarily due to basic rate increases
associated with new programming introductions and to revenues associated with
our recently launched digital cable and high-speed Internet access services.

Service costs. Service costs increased 133.5% to approximately $28.9
million for the three months ended September 30, 2000 as compared to
approximately $12.4 million for the three months ended September 30, 1999. The
Acquired Systems accounted for approximately $14.3 million of the total
increase. Excluding the Acquired Systems, these costs increased 17.8% primarily
as a result of higher programming expenses, including the cost of additional
channel offerings to the Company's basic subscribers. As a percentage of
revenues, service costs were 34.3% for the three months ended September 30,
2000, as compared with 31.7% for the three months ended September 30, 1999.

Selling, general and administrative expenses. Selling, general and
administrative expenses increased 89.9% to approximately $13.9 million for the
three months ended September 30, 2000 as compared to approximately $7.3 million
for the three months ended September 30, 1999. The Acquired Systems accounted
for approximately $6.4 million of the total increase. Excluding the Acquired
Systems, these costs increased 2.9%. As a percentage of revenues, selling,
general and administrative expenses were 16.4% for the three months ended
September 30, 2000, as compared with 18.7% for the three months ended September
30, 1999.

Corporate expenses. Corporate expenses were unchanged at approximately $1.6
million for the three months ended September 30, 2000 as compared to the three
months ended September 30, 1999. As a percentage of revenues, corporate expenses
were 1.9% for the three months ended September 30, 2000 as compared with 4.0%
for the three months ended September 30, 1999. During the three months ended
September 30, 1999, Mediacom Management Corporation ("Mediacom Management") was
paid certain amounts by the Company pursuant to management agreements between
Mediacom Management and the Company's operating agreements. Such management
agreements were terminated on the date of the Company's initial public offering
in February 2000. At that time, Mediacom Management's employees became the
Company's employees and its other overhead expenses became the Company's
corporate expenses. The Company reported its corporate expenses as management
fees incurred before the initial public offering and as actual amounts incurred
from the date of its initial public offering. See Note 9 of the Company's
consolidated financial statements.

Depreciation and amortization. Depreciation and amortization increased
82.4% to approximately $45.1 million for the three months ended September 30,
2000 as compared to approximately $24.7 million in the three months ended
September 30, 1999. This increase was due to the Acquired Systems and additional
capital expenditures associated with the upgrade of the Company's systems.

Non-cash stock charges. Non-cash stock charges were approximately $609,000
for the three months ended September 30, 2000, resulting from the grant of
equity interests in the fourth quarter of 1999 to certain members of the
Company's management team. See Note 9 of the Company's consolidated financial
statements.

Interest expense, net. Interest expense, net, increased 134.7% to
approximately $16.9 million for the three months ended September 30, 2000 as
compared to approximately $7.2 million for the three months ended September 30,
1999. This increase was substantially due to higher average debt outstanding
during the three months ended September 30, 2000, principally as a result of
debt incurred in connection with the Acquired Systems.

14
<PAGE>

Other expenses. Other expenses were approximately $353,000 for the three
months ended September 30, 2000 as compared to approximately $245,000 of other
income for the three months ended September 30, 1999. This change was
principally due to an increase in fees associated with the Company's credit
arrangements.

Provision for income taxes. Provision for income taxes was approximately
$83,000 for the three months ended September 30, 2000. This benefit reflects the
net tax effect of temporary differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the amounts used for income
tax purposes.

Net loss. Due to the factors described above, the Company generated a net
loss of approximately $23.0 million for the three months ended September 30,
2000 as compared to a net loss of approximately $14.4 million for the three
months ended September 30, 1999.

EBITDA. EBITDA increased 125.2% to approximately $40.0 million for the
three months ended September 30, 2000 as compared to approximately $17.8 million
for the three months ended September 30, 1999. This increase was substantially
due to the reasons noted above. As a percentage of revenues, EBITDA increased to
47.4% for the three months ended September 30, 2000, compared to 45.5% for the
three months ended September 30, 1999.

Nine Months Ended September 30, 2000 Compared to Nine Months Ended September
30, 1999

Revenues. Revenues increased 115.9% to approximately $244.5 million for the
nine months ended September 30, 2000 as compared to $113.2 million for the nine
months ended September 30, 1999. Of the revenue increase of $131.3 million,
$118.2 was attributable to the Acquired Systems. Excluding the Acquired Systems,
revenues increased 11.5% primarily due to basic rate increases associated with
new programming introductions and to revenues associated with our recently
launched digital cable and high-speed Internet access services.

Service costs. Service costs increased 129.2% to approximately $83.8
million for the nine months ended September 30, 2000 as compared to
approximately $36.6 million for the nine months ended September 30, 1999. The
Acquired Systems accounted for approximately $41.9 million of the total
increase. Excluding the Acquired Systems, these costs increased 14.5% primarily
as a result of higher programming expenses, including the cost of additional
channel offerings to the Company's basic subscribers. As a percentage of
revenues, service costs were 34.3% for the nine months ended September 30, 2000,
as compared with 32.3% for the nine months ended September 30, 1999.

Selling, general and administrative expenses. Selling, general and
administrative expenses increased 88.7% to approximately $41.2 million for the
nine months ended September 30, 2000 as compared to approximately $21.8 million
for the nine months ended September 30, 1999. The Acquired Systems accounted for
approximately $18.6 million of the total increase. Excluding the Acquired
Systems, these costs increased 3.4%. As a percentage of revenues, selling,
general and administrative expenses were 16.8% for the nine months ended
September 30, 2000, as compared with 19.3% for the nine months ended September
30, 1999.

Corporate expenses. Corporate expenses decreased 12.1% to approximately
$4.5 million for the nine months ended September 30, 2000 as compared to
approximately $5.2 million for the nine months ended September 30, 1999. As a
percentage of revenues, corporate expenses were 1.9% for the nine months ended
September 30, 2000 as compared with 4.5% for the nine months ended September 30,
1999. The decrease in corporate expenses was primarily due to higher amounts
charged by Mediacom Management during the nine months ended September 30, 1999
under management agreements between Mediacom Management and the Company's
operating subsidiaries. Such management agreements were terminated on the date
of the Company's initial public offering in February 2000. At that time,
Mediacom Management's employees became the Company's employees and its other
overhead expenses became the Company's corporate expenses. The Company reported
its corporate expenses as management fees incurred before the initial public
offering and as actual amounts incurred from the date of its initial public
offering.

Depreciation and amortization. Depreciation and amortization increased
95.4% to approximately $129.3 million for the nine months ended September 30,
2000 as compared to approximately $66.2 million in the nine months ended
September 30, 1999. This increase was due to the Acquired Systems and additional
capital expenditures associated with the upgrade of the Company's systems.

Non-cash stock charges. Non-cash stock charges were approximately $27.6
million for the nine months ended September 30, 2000. These non-cash charges
comprise a one-time $24.5 million charge resulting from the termination

15
<PAGE>

of the management agreements with Mediacom Management on the date of the
Company's initial public offering and a $3.1 million charge related to the grant
of equity interests in the fourth quarter of 1999 to certain members of the
Company's management team. See Note 9 of the Company's consolidated financial
statements.

Interest expense, net. Interest expense, net, increased 150.0% to
approximately $51.4 million for the nine months ended September 30, 2000 as
compared to approximately $20.6 million for the nine months ended September 30,
1999. This increase was substantially due to higher average debt outstanding
during the nine months ended September 30, 2000 as a result of debt incurred in
connection with the Acquired Systems.

Other expenses. Other expenses increased 25.1% to approximately $1.2
million for the nine months ended September 30, 2000 as compared to
approximately $979,000 for the nine months ended September 30, 1999. This change
was principally due to an increase in fees associated with the Company's credit
arrangements.

Provision for income taxes. Provision for income taxes was approximately
$1.4 million for the nine months ended September 30, 2000. This provision
primarily reflects a one-time, non-cash charge recognized upon the exchange of
membership interests in Mediacom LLC for shares of MCC common stock.

Net loss. Due to the factors described above, the Company generated a net
loss of approximately $95.9 million for the nine months ended September 30, 2000
as compared to a net loss of approximately $38.0 million for the nine months
ended September 30, 1999.

EBITDA. EBITDA increased 131.4% to approximately $115.0 million for the
nine months ended September 30, 2000 as compared to approximately $49.7 million
for the nine months ended September 30, 1999. This increase was substantially
due to the reasons noted above. As a percentage of revenues, EBITDA increased to
47.0% for the nine months ended September 30, 2000, compared to 43.9% for the
nine months ended September 30, 1999.

Selected Pro Forma Results

The Company has reported the results of operations of the Acquired Systems
from the date of their respective acquisition. The financial information below
for the nine months ended September 30, 2000 and 1999, presents selected
unaudited pro forma operating results assuming the purchase of the Acquired
Systems had been consummated on January 1, 1999. This financial information is
not necessarily indicative of what results would have been had the Company
operated these cable systems since the beginning of 1999. See Note 3 to the
Company's consolidated financial statements for a detailed description of the
Company's acquisitions in 2000 and 1999.

<TABLE>
<CAPTION>
Nine Months Ended September 30,
--------------------------------
2000 1999
--------------- -------------
(dollars in thousands, except per
subscriber data)
<S> <C> <C>
Revenues.................................................................. $ 247,423 $ 226,423
Costs and expenses:
Service costs.......................................................... 85,040 75,770
SG&A expenses.......................................................... 41,754 40,720
Corporate expenses..................................................... 4,529 8,933
Depreciation and amortization.......................................... 130,832 124,017
Non-cash stock charges................................................. 27,596 -
------------ ------------
Operating loss............................................................ $ (42,328) $ (23,017)
============ ============
Other Data:
EBITDA.................................................................... 116,100 101,000
EBITDA margin (1)......................................................... 46.9% 44.6%
Basic subscribers (2)..................................................... 743,000 734,000
Average monthly revenue per basic subscriber (3).......................... $ 38.08 $ 35.26
</TABLE>

___________________________________________
/(1)/ Represents EBITDA as a percentage of revenues.
/(2)/ At end of the period.
/(3)/ Represents average monthly revenues for the last three months of the
period divided by average basic subscribers for the period.

16
<PAGE>

Selected Pro Forma Results for Nine Months Ended September 30, 2000 Compared to
Selected Pro Forma Results for Nine Months Ended September 30, 1999

Revenues increased 9.3% to approximately $247.4 million for the nine months
ended September 30, 2000, as compared to approximately $226.4 million for the
nine months ended September 30, 1999. This increase was attributable principally
to internal subscriber growth of 1.2%, basic rate increases associated with new
programming introductions and to revenues associated with our recently launched
digital cable and high-speed Internet access services.

Service costs and selling, general and administrative expenses in the
aggregate increased 8.8% to approximately $126.8 million for the nine months
ended September 30, 2000 from approximately $116.5 million for the nine months
ended September 30, 1999, principally due to higher programming costs incurred
by the Company for the systems acquired in 1999.

Corporate expenses decreased 49.3% to approximately $4.5 million for the
nine months ended September 30, 2000 from approximately $8.9 million for the
nine months ended September 30, 1999. As a percentage of revenues, corporate
expenses were 1.8% for the nine months ended September 30, 2000 as compared with
3.9% for the nine months ended September 30, 1999. The decrease in corporate
expenses was primarily due to a reduction in amounts charged by Mediacom
Management, resulting from amendments to management agreements between Mediacom
Management and the Company's operating subsidiaries. Such management agreements
were terminated on the date of the Company's initial public offering in February
2000. The Company reported its corporate expenses as management fees incurred
before the initial public offering and as actual amounts incurred from the date
of its initial public offering.

Depreciation and amortization increased 5.5% to approximately $130.8
million for the nine months ended September 30, 2000 from approximately $124.0
million for the nine months ended September 30, 1999. This increase was
principally due to capital expenditures associated with the upgrade of the
Company's systems. Non-cash stock charges were as reported above.

As a result of the above factors, the Company generated an operating loss
of approximately $42.3 million for the nine months ended September 30, 2000,
compared to approximately $23.0 million for the nine months ended September 30,
1999.

EBITDA increased by 15.0% to approximately $116.1 million for the nine
months ended September 30, 2000 from approximately $101.0 million for the nine
months ended September 30, 1999. The EBITDA margin improved to 46.9% for the
nine months ended September 30, 2000 from 44.6% for the nine months ended
September 30, 1999.

Liquidity and Capital Resources

The Company's business requires substantial capital for the upgrade,
expansion and maintenance of its cable and fiber network. In addition, the
Company has pursued, and will continue to pursue, a business strategy that
includes selective acquisitions. The Company has funded its working capital
requirements, capital expenditures and acquisitions through a combination of
internally generated funds, long-term borrowings and equity contributions. The
Company intends to continue to finance such expenditures through internally
generated funds, long-term borrowings and equity financings.

From the commencement of its operations in March 1996 through December
1999, the Company invested approximately $1.2 billion, before closing costs and
adjustments, to acquire cable television systems serving 724,000 basic
subscribers as of September 30, 2000.

In 2000, the Company has completed or anticipates completing the undernoted
acquisitions of cable systems serving 53,000 basic subscribers for an aggregate
purchase price of $109.0 million.

. On April 6, 2000, the Company acquired the assets of cable television
systems owned by Rapid Communications Partners, L.P. ("Rapid") for a
purchase price of $8.0 million. The Rapid systems serve approximately
6,000 basic subscribers primarily in Kentucky and Illinois.

17
<PAGE>

. On April 21, 2000, the Company acquired the assets of cable television
systems owned by MidAmerican Cable Systems, L.P. ("MidAmerican") for a
purchase price of approximately $8.0 million. The MidAmerican systems
serve approximately 5,000 basic subscribers primarily in Illinois.

. On May 25, 2000, the Company acquired the assets of cable television
systems owned by Tri Cable, Inc. ("Tri Cable") for a purchase price of
approximately $1.8 million. The Tri Cable systems serve approximately
1,000 basic subscribers in Minnesota.

. On June 28, 2000, the Company acquired the assets of a cable
television system owned by Spirit Lake Cable TV, Inc. and E.M. Parsen
("Spirit Lake") for a purchase price of approximately $10.8 million.
The Spirit Lake system serves approximately 5,000 basic subscribers
primarily in Iowa.

. On July 12, 2000, the Company acquired the assets of a cable
television system owned by South Kentucky Services Corporation ("South
Kentucky") for a purchase price of approximately $2.1 million. The
South Kentucky system serves approximately 1,000 basic subscribers
primarily in Kentucky.

. On August 31, 2000, the Company acquired the assets of cable
television systems owned by Dowden Midwest Cable Partners, L.P.
("Dowden") for a purchase price of approximately $1.2 million. The
Dowden systems serve approximately 1,000 basic subscribers primarily
in Illinois.

. On October 12, 2000, the Company acquired the stock and assets of
cable television systems owned by Illinet Communications of Central
Illinois, LLC ("Illinet") for a purchase price of approximately $15.6
million. The Illinet systems serve approximately 8,000 basic
subscribers primarily in Illinois.

. On October 31, 2000, the Company acquired the assets of cable
television systems owned by Satellite Cable Services, Inc.
("Satellite") for a purchase price of approximately $27.5 million. The
Satellite systems serve approximately 12,000 basic subscribers
primarily in South Dakota.

. On November 3, 2000, the Company signed a definitive agreement to
acquire cable television systems serving approximately 14,000 basic
subscribers for a purchase price of approximately $34.0 million.

Substantially all of the basic subscribers served by the completed and
pending acquisitions are within the Company's regional operating clusters. The
pending acquisition is subject to a number of closing conditions, including
regulatory approvals and other third party consents and no assurance can be
given that this acquisition will be consummated. The Company expects to complete
this pending acquisition by year-end 2000.

For the nine months ended September 30, 2000, the Company's capital
expenditures were $134.1 million. The Company expects to spend approximately
$180.0 million in capital expenditures in 2000, including capital expenditures
associated with acquisitions completed in 2000. As a result of its capital
investment plans, excluding the acquisitions made in 2000, the Company
anticipates that by December 2000, 77% of its cable network will be upgraded to
550MHz - 750MHz bandwidth capacity compared to 57% as of December 1999 and that
50% of its homes passed will be activated with two-way communications capability
compared to 11% as of December 1999.

On February 9, 2000, the Company completed an initial public offering of
20,000,000 shares of Class A common stock at $19.00 per share. The net proceeds,
after underwriting discounts of approximately $22.8 million and estimated
expenses related to the offering of approximately $3.0 million, were $354.2
million and were used to repay bank indebtedness.

To finance the Company's acquisitions, working capital requirements and
capital expenditures and to provide liquidity for future capital needs, the
Company had the following debt financing arrangements in place as of September
30, 2000:

. $200.0 million offering of 8 1/2% senior notes due April 2008;

. $125.0 million offering of 7 7/8% senior notes due February 2011;

. $550.0 million subsidiary credit facility expiring in September 2008;
and

. $550.0 million subsidiary credit facility expiring in December 2008.

18
<PAGE>

The final maturities of the Company's subsidiary credit facilities are
subject to earlier repayment on dates ranging from June 2007 to December 2007 if
the Company does not refinance its 8 1/2% senior notes prior to March 31, 2007.
As of September 30, 2000, the Company was in compliance with all of the
financial and other covenants provided for in its subsidiary credit agreements.

As of September 30, 2000, the Company entered into interest rate swap
agreements, which expire from 2002 through 2003, to hedge $140.0 million of
floating rate debt under its subsidiary credit facilities. As a result of these
interest rate swap agreements, approximately 53% of the Company's outstanding
debt was at fixed interest rates or subject to interest rate protection on such
date. After giving effect to these interest rate swap agreements, as of
September 30, 2000, the Company's weighted average cost of indebtedness was
approximately 8.2%.

Debt leverage and interest coverage ratios are commonly used in the cable
television industry to measure liquidity and financial condition. For the three
month period ended September 30, 2000, the Company's debt leverage ratio
(defined as total debt at the end of the period, divided by pro forma annualized
EBITDA for the period) was 5.5x and the Company's interest coverage ratio
(defined as EBITDA divided by interest expense, net for the period) was 2.4x. As
of September 30, 2000, the Company had approximately $537.6 million of unused
credit commitments under its subsidiary credit facilities.

In May 2000, the Company announced that its Board of Directors had
authorized a repurchase program (the "Repurchase Program") pursuant to which the
Company may purchase up to $50.0 million of its Class A common stock, in the
open market or through privately negotiated transactions, subject to certain
restrictions and market conditions. During the second quarter of 2000, in
connection with the Repurchase Program, the Company repurchased 80,000 shares of
its Class A common stock for the aggregate cost of approximately $658,000 at
share prices ranging from $8.00 to $10.75 per share. The repurchased stock was
retired and resulted in a reduction of stockholders' equity.

Although the Company has not generated earnings sufficient to cover fixed
charges, the Company has generated cash and obtained financing sufficient to
meet its debt service, working capital, capital expenditure and acquisition
requirements. The Company expects that it will continue to be able to generate
funds and obtain financing sufficient to service its obligations and complete
its pending and future acquisitions. There can be no assurance that the Company
will be able to obtain sufficient financing, or, if it was able to do so, that
the terms would be favorable to them.

Recent Accounting Pronouncements

Inflation and Changing Prices

The Company's systems' costs and expenses are subject to inflation and
price fluctuations. Since changes in costs can be passed through to subscribers,
such changes are not expected to have a material effect on their results of
operations.

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<PAGE>

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In the normal course of business, the Company uses interest rate swap
agreements in order to fix the interest rate for the duration of the contract as
a hedge against interest rate volatility. As of September 30, 2000, the Company
had interest rate exchange agreements (the "Swaps") with various banks pursuant
to which the interest rate on $140.0 million is fixed at a weighted average swap
rate of approximately 6.8%, plus the average applicable margin over the
Eurodollar Rate option under the Company's bank credit agreement. Under the
terms of the Swaps, which expire from 2002 through 2003, the Company is exposed
to credit loss in the event of nonperformance by the other parties to the Swaps.
However, the Company does not anticipate nonperformance by the counterparties.
The Company would have received approximately $396,000 if it terminated the
Swaps, inclusive of accrued interest, at September 30, 2000. The table below
provides information for the Company's long term debt. See Note 6 to the
Company's consolidated financial statements.

Expected Maturity
--------------------------------------------------------------------
(All dollar amounts in thousands)
2001 2002 2003 2004 2005 Thereafter Total Fair Value
------ ------ ------ ------ ------ ------------ ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Fixed rate $ - $ - $ - $ - $ - 200,000 200,000 191,000

Weighted average
interest rate 8.5% 8.5% 8.5% 8.5% 8.5% 8.5% 8.5%

Fixed rate $ - $ - $ - $ - $ - 125,000 125,000 109,000

Weighted average
interest rate 7.9% 7.9% 7.9% 7.9% 7.9% 7.9% 7.9%

Variable rate $ - $ 750 $ 2,000 $ 2,000 $ 2,000 $ 554,250 $ 561,000 $ 561,000

Weighted average
interest rate 8.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1%
</TABLE>

20
<PAGE>

PART II
-------

ITEM 1. LEGAL PROCEEDINGS

ITEM 6.

(a) Exhibits

Exhibit
Number Exhibit Descriptions
------ --------------------
27.1 Financial Data Schedule

(b) Reports on Form 8-K

None.

21
<PAGE>

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.

MEDIACOM COMMUNICATIONS CORPORATION

November 14, 2000 BY: /S/ MARK E. STEPHAN
-----------------------------------
Mark E. Stephan
Senior Vice President,
Chief Financial Officer,
Treasurer and Principal Financial
Officer