MDU Communications International, Inc.
OTC Bulletin Board : MDTV

MDU Communications International, Inc.

March 28, 2007 09:01 ET

MDU Communications Anticipates Increase in Video Subscriber Revenue (ARPU), Continued Positive EBITDA and Additional Private Cable Conversions

TOTOWA, NEW JERSEY--(CCNMatthews - March 28, 2007) - MDU Communications International, Inc. (OTCBB:MDTV), a leading end-to-end provider of DIRECTV® digital satellite television programming, high-speed Internet and other premium communication and information services to the residential multi-dwelling unit market, today reports that it anticipates an increase in its average revenue per subscriber ("ARPU") from video subscribers in future quarters due to certain price increases and the continued conversions of private cable systems to DIRECTV® services. The Company also anticipates continued positive EBITDA for the second fiscal quarter of '07.

The Company's ARPU across its subscriber base was $27.47 at December 31, 2006, a 5% increase over the ARPU of $26.04 for fiscal 2006, which translated to positive EBITDA of approximately $1.60 per month per subscriber. As a result of recently announced price increases for certain of the Company's video services, the Company expects its ARPU from subscribers to DIRECTV services residing in properties signed to bulk, exclusive and choice access agreements to increase by approximately 4% per month effective April of 2007. This 4% gross increase in DIRECTV derived revenue translates into an improvement of between $0.50 and $0.80 per month in EBITDA for this type of subscriber, or an expected 30% to 50% increase in EBITDA for this type of subscriber, as there is no offsetting expense associated with these price increases. Even after these increases, the Company believes that its prices remain very competitive with franchised cable offerings.

Although these increases will not be reflected in revenues for the Company's second fiscal quarter, it is expected that the Company will again operate at positive EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter ending March 31, 2007.

Additionally, the Company is placing continued emphasis on the conversion of private cable properties to bulk DIRECTV services, having recently signed agreements to convert both a 228 unit property and a 312 unit property in its Midwest region from private cable to DIRECTV BCA services. The long term benefit of these conversions is significant due to the fact that DIRECTV BCA subscribers generate approximately a 40% higher ARPU than private cable bulk subscribers. The conversion of private cable subscribers to DIRECTV services is expected to continue in fiscal 2007.

"The additional margin we expect to earn as a result of these price increases and conversions equates to a sort of dividend for our shareholders. Over time, small increases in gross revenues can amount to a material improvement in our EBITDA or cash flow per subscriber," commented Sheldon Nelson, President and Chief Executive Officer of the Company. The Company expects to file its quarterly report on Form 10-Q for the period ending March 31, 2007 with the Securities and Exchange Commission on or before May 14, 2007.

About MDU: MDU Communications International, Inc. (OTCBB:MDTV) is a leading provider of premium communication/information services, including digital satellite television and high-speed (broadband) Internet services, exclusively to the United States multi-dwelling unit (MDU) marketplace - estimated to include 26 million residences. Through its wholly owned subsidiary, MDU Communications (USA) Inc., MDU Communications delivers DIRECTV® digital satellite television services and high-speed (broadband) Internet systems and is committed to delivering the next generation of interactive communication services to MDU residents. For additional information, please see or contact Investor Relations.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements relating to financial information, shareholder valuation, subscriber and revenue growth and implementation of new programs of the Company. Such statements involve risks and uncertainties which may cause results to differ materially from those set forth in these statements, including, but not limited to, changes in financial condition, efforts on behalf of the Company to finalize and deploy certain conversions and programs, fluctuations in operating results and operating plans, deployment of new subscribers and conversion of existing subscribers, market forces, supplier negotiations and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including, but not limited to, the Company's 10-K for the year ended September 30, 2006, filed on or about January 2, 2007.

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