Dec 24, 2002 By Jim Suhr Ap Business Writer 3 min read

ST. LOUIS (AP) – Charter Communications Inc., the nation’s third-largest cable television company, said Monday it has fired its chief operating officer and chief financial officer amid an unfolding federal grand jury probe of its accounting practices. Charter, in the process of restating its 2000 and 2001 results, also said it expects fourth-quarter revenue growth to be at or near the low end of its earlier target of 8 percent to 9 percent, and fourth-quarter operating cash flow to be less than its previous guidance.

The St. Louis-based company did not elaborate, and a message left Monday was not immediately returned.

In a statement, Charter said chief financial officer Kent Kalkwarf will be replaced on an interim basis by Steven Schumm, an executive vice president and the company’s chief administrative officer.

David Barford, the chief operating officer placed on paid leave in October, will be succeeded by Maggie Bellville, who joined Charter this month as executive vice president of operations.

Kalkwarf and Barford have held their positions since mid-2000 at Charter, which has about 6.7 million customers in 40 states and is controlled by Microsoft Corp. co-founder Paul Allen.

In a statement, Charter said the firings “follow a review by the company of various matters, including those relating to the previously disclosed grand jury investigation.” Charter said the government has told it that no one on the company’s board, including president and chief executive Carl Vogel, is a target of the investigation.

“These actions with respect to the management changes and the re-audit of the company’s financials are necessary so that Charter Communications can move forward as we focus on building the company for the future,” Vogel said in the statement.

Shares of Charter were down 3 cents, or 2.6 percent, to $1.16 in Monday morning trading on the Nasdaq stock market. The company’s stock peaked at $22 per share in August 2001 but has been pummeled amid Wall Street concerns about the company’s debt, the grand jury inquiry and shareholder lawsuits.

Ted Henderson, a Denver-based cable industry analyst, said the executive shakeup appeared “intended to show the grand jury that ‘at Charter, we’re not going to tolerate this, and we’re fixing these procedures,”‘ Henderson said.

Charter said Monday the restatements of 2000 and 2001, as well as the audit of 2002 results, should be completed by next year’s first quarter. Accordingly, the company said it would not offer further specific guidance until completing the 2002 audit.

Vogel said the restatements and the 2002 audit “will provide a clear picture of Charter Communications financial position.”

Earlier this month, Charter said it plans to streamline its operation in a move that will cost a “significant” number of workers their jobs, with most of the cuts to come from middle management. While Charter has said those moves would be announced by this month’s end, Monday’s announcement offered no details.

Charter said Monday its board has ordered the company to adopt a “rigorous corporate compliance program” that will include the tapping of an internal overseer, the establishment of a compliance hotline and the adoption of a “comprehensive, expanded employee code of conduct.”

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On the Net:

Charter Communications, http://www.charter.com