-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MNfhSbjNXOME13SipFqIvaMDhoX4KcadJbzQnJ54lO409cfFvtQgdUzVm8N6OnvR b5bGiVygbGCoBZ+v8yYGeg== 0000018926-04-000003.txt : 20040129 0000018926-04-000003.hdr.sgml : 20040129 20040129100633 ACCESSION NUMBER: 0000018926-04-000003 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20031231 ITEM INFORMATION: FILED AS OF DATE: 20040129 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTURYTEL INC CENTRAL INDEX KEY: 0000018926 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 720651161 STATE OF INCORPORATION: LA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-07784 FILM NUMBER: 04550828 BUSINESS ADDRESS: STREET 1: P O BOX 4065 STREET 2: 100 CENTURYTEL DR CITY: MONROE STATE: LA ZIP: 71203 BUSINESS PHONE: 3183889000 MAIL ADDRESS: STREET 1: 100 CENTURYTEL DR STREET 2: P O BOX 4065 CITY: MONROE STATE: LA ZIP: 71203 FORMER COMPANY: FORMER CONFORMED NAME: CENTURY TELEPHONE ENTERPRISES INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: CENTRAL TELEPHONE & ELECTRONICS CORP DATE OF NAME CHANGE: 19720512 8-K 1 earningsrls.txt FOURTH QTR EARNINGS RLS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) January 29, 2004 CenturyTel, Inc. (Exact name of registrant as specified in its charter) Louisiana 1-7784 72-0651161 (State or other (Commission File (IRS Employer jurisdiction of Number) Identification No.) incorporation) 100 CenturyTel Drive, Monroe, Louisiana 71203 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (318) 388-9000 --------------------------- ITEM 12. Results of Operations and Financial Condition The following information, except for our forecasts for the upcoming quarter and for 2004 and except for our references to non-GAAP financial measures (as defined in Regulation G promulgated by the Securities and Exchange Commission), shall be deemed incorporated by reference into any registration statement heretofore or hereafter filed by us under the Securities Act of 1933, as amended, except to the extent that such incorporated information is superceded by information as of a subsequent date that is included in or incorporated by reference into any such registration statement. None of the following information shall be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. On January 29, 2004, we issued a press release announcing our fourth quarter 2003 consolidated operating results. More complete information on our operating results will be included in our Annual Report on Form 10-K for the year ended December 31, 2003, which we expect to file shortly with the Securities and Exchange Commission. The entire text of our January 29, 2004 press release is reproduced below: FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT: January 29, 2004 Media: Patricia Cameron 318.388.9674 patricia.cameron@centurytel.com Investors: Tony Davis 318.388.9525 tony.davis@centurytel.com CenturyTel Announces Fourth Quarter 2003 Earnings - ------------------------------------------------- Monroe, LA. . . CenturyTel, Inc. (NYSE Symbol: CTL) announces operating results for fourth quarter 2003. o Revenues, excluding nonrecurring items, increased 3.2% to $604.8 million from $585.9 million, while GAAP revenues increased 3.5% to $606.3 million from $585.9 million. o Operating cash flow (as defined in the attached financial schedules), excluding nonrecurring items, rose 0.8% to $311.4 million. o Net income, excluding nonrecurring items, grew 4.9% to $89.3 million. Reported under GAAP, net income was $82.4 million. o Diluted earnings per share, excluding nonrecurring items, increased 3.4% to $.61, while GAAP diluted earnings per share was $.57 in fourth quarter 2003. o Free cash flow (as defined in the attached financial schedules), excluding nonrecurring items, was $86.8 million in fourth quarter 2003.
- --------------------------------------------------------------------------------------- Fourth Quarter Highlights (1) Quarter Ended Quarter Ended % Change (In thousands, except per share 12/31/03 12/31/02 and customer amounts) - --------------------------------------------------------------------------------------- Revenues $ 604,815 $ 585,879 3.2% Operating Cash Flow $ 311,442 $ 308,920 0.8% Net Income $ 89,267 $ 85,074 4.9% Diluted Earnings Per Share $ .61 $ .59 3.4% Average Diluted Shares Outstanding 145,354 143,380 1.4% Telephone Revenues $ 522,691 $ 519,427 0.6% Other Operations Revenues $ 82,124 $ 66,452 23.6% - --------------------------------------------------------------------------------------- Telephone Access Lines 2,376,118 2,414,564 (1.6)% Long Distance Customers 769,766 648,797 18.6% - ---------------------------------------------------------------------------------------
(1) These results include adjustments for nonrecurring items and other non-GAAP financial measures. A reconciliation of these items to comparable GAAP measures is included in the attached financial schedules. "During 2003, CenturyTel achieved revenue and earnings growth in a very challenging industry environment," Glen F. Post, III, chairman and chief executive officer, said. "Record cash flows generated in 2003 provided the financial liquidity for CenturyTel to reduce debt by more than $467 million and strengthen our cash position by nearly $200 million." Consolidated revenues for the fourth quarter, excluding nonrecurring items, rose 3.2% to $604.8 million from $585.9 million. Operating cash flow, excluding nonrecurring items, grew to $311.4 million from $308.9 million. The Company achieved a consolidated cash flow margin, excluding nonrecurring items, of 51.5% for fourth quarter 2003. Net income for the quarter, excluding nonrecurring items, increased 4.9% to $89.3 million from $85.1 million in fourth quarter 2002. Diluted earnings per share, excluding nonrecurring items, increased 3.4% to $.61 from $.59. Telephone revenues for the fourth quarter, excluding nonrecurring items, reached $522.7 million compared to $519.4 million in fourth quarter 2002. Growth in enhanced calling features and intrastate access revenues was partially offset by declines in intrastate toll usage and access lines. Telephone operating income, excluding nonrecurring items, was $175.5 million while telephone operating cash flow, excluding nonrecurring items, was $289.1 million. Excluding nonrecurring items, CenturyTel's fourth quarter 2003 telephone operating cash flow margin was 55.3% while the operating income margin was 33.6%. Other operations revenues grew 23.6% to $82.1 million during fourth quarter 2003, compared with $66.5 million in fourth quarter 2002. CenturyTel's long distance revenues increased 5.5% to $42.9 million. Internet revenues increased 31.6% to $21.6 million in fourth quarter 2003 from $16.4 million in fourth quarter 2002. CenturyTel now serves nearly 770,000 long distance customers and more than 83,000 DSL customers, adding more than 24,500 and 7,100 customers, respectively, during the quarter. Fiber transport revenues increased $7.4 million, primarily due to the June 2003 acquisition of fiber assets from Digital Teleport, Inc. For the year 2003, results from continuing operations benefited from the Alabama and Missouri wireline properties acquired from Verizon in third quarter 2002. Revenues from continuing operations, excluding nonrecurring items, increased to $2.379 billion from $1.980 billion for the same period in 2002, a 20.2% increase. Operating cash flow from continuing operations, excluding nonrecurring items, was $1.222 billion for 2003 compared to $1.012 billion a year ago, a 20.8% increase. Income from continuing operations, excluding nonrecurring items, increased 39.1% to $345.8 million from $248.5 million in 2002. "Customer demand for long distance and Internet services continued to drive solid revenue growth of nearly $49 million in 2003 as long distance customers grew nearly 19% and DSL customers grew more than 58%. We believe the development of our integrated bundle during 2004 will stimulate further demand for services," Post said. Under generally accepted accounting principles (GAAP), the Company's fourth quarter 2003 net income was $82.4 million compared to $44.3 million in 2002, while diluted earnings per share was $.57 for fourth quarter 2003 compared to $.31 in fourth quarter 2002. Net income in fourth quarter 2003 reflects an $8.8 million after-tax charge associated with various operating tax audits and an after-tax benefit of $2.0 million related to professional fees previously accrued. Net income in fourth quarter 2002 included a $39.0 million after-tax charge associated with the redemption of $400 million Series I remarketable senior notes. See the accompanying financial information for additional nonrecurring items that affected the fourth quarters and full years of 2003 and 2002. For the year 2003, prepared in accordance with GAAP, the Company reported net income of $344.7 million, or $2.38 per diluted share, compared to net income of $801.6 million, or $5.61 per diluted share for the year 2002. The 2002 results included a $551.4 million after-tax gain, or $3.86 per diluted share, from the sale of the Company's wireless operations in third quarter 2002. Guidance for 2004. CenturyTel anticipates a decline in 2004 telephone revenues primarily due to lower intrastate toll usage, lower cost study adjustments, lower universal service funding and access line declines. Giving effect to these revenue declines, the incremental amortization expense, conversion and operating costs related to the new billing and customer care system, and an expected increase in the Company's effective income tax rate to 38.5% primarily due to state income taxes, CenturyTel expects full year 2004 diluted earnings per share to be in the range of $2.05 to $2.20. For first quarter 2004, CenturyTel expects total revenues of $585 to $600 million and diluted earnings per share of $.49 to $.53. These outlook figures are presented on a GAAP basis, excluding nonrecurring items and the potential impact of any future mergers, acquisitions, divestitures or other similar business transactions. Reconciliation to GAAP. This release includes certain non-GAAP financial measures, including but not limited to operating cash flow, free cash flow and adjustments to GAAP measures to exclude the effect of nonrecurring items. In addition to providing key metrics for management to evaluate the Company's performance, we believe these measurements assist investors in their understanding of period-to-period operating performance and in identifying historical and prospective trends. Reconciliations of non-GAAP financial measures to the most comparable GAAP measures are included in the attached financial schedules. Reconciliation of additional non-GAAP financial measures that may be discussed during the earnings call described below will be available on the Company's Web site at www.centurytel.com. Investors are urged to consider these non-GAAP measures in addition to, and not in substitution for, measures prepared in accordance with GAAP. In addition to historical information, this release includes certain forward-looking statements, estimates and projections that are based on current expectations only, and are subject to a number of risks, uncertainties and assumptions, many of which are beyond the control of the Company. Actual events and results may differ materially from those anticipated, estimated or projected if one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect. Factors that could affect actual results include but are not limited to: the timing, success and overall effects of competition from a wide variety of competitive providers; the risks inherent in rapid technological change; the effects of ongoing changes in the regulation of the communications industry; the Company's ability to effectively manage its growth, including integrating newly-acquired businesses into the Company's operations, hiring adequate numbers of qualified staff, and successfully upgrading its billing and other information systems; possible changes in the demand for, or pricing of, the Company's products and services; the Company's ability to successfully introduce new product or service offerings on a timely and cost-effective basis; the Company's ability to collect its receivables from financially troubled communications companies; other risks referenced from time to time in the Company's filings with the Securities and Exchange Commission; and the effects of more general factors such as changes in interest rates, in accounting policies or practices, in operating, medical or administrative costs, in general market, labor or economic conditions, or in legislation, regulation or public policy. These and other uncertainties related to the Company's business are described in greater detail in the Company's Annual Report on Form 10-K for the year ended December 31, 2002. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The information contained in this release is as of January 29, 2004. The Company undertakes no obligation to update any of its forward-looking statements. CenturyTel's management will host a conference call at 11:00 A.M. Central time today. Interested parties can access the call by dialing 800.346.2923 and the call will be accessible for replay until 1:00 p.m. CST, February 5, 2004, by calling 800.332.6854 and entering the conference-id number: 3383. Investors can also listen to CenturyTel's earnings conference call and replay by accessing the Company's Web site at www.centurytel.com CenturyTel, Inc. provides communications services including local, long distance, Internet access and data services to more than 3 million customers in 22 states. The company, headquartered in Monroe, Louisiana, is publicly traded on the New York Stock Exchange under the symbol CTL, and is included in the S&P 500 Index. CenturyTel is the 8th largest local exchange telephone company, based on access lines, in the United States. Visit CenturyTel at www.centurytel.com. -------------------------- CenturyTel, Inc. CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002 (UNAUDITED)
Three months ended December 31, 2003 Three months ended December 31, 2002 ------------------------------------ ------------------------------------ As adjusted As adjusted Increase Less excluding Less excluding (decrease) non- non- non- non- Increase excluding In thousands, except As recurring recurring As recurring recurring (decrease) nonrecurring per share amounts reported items items reported items items as reported items ------------------------------------ ------------------------------------ -------------------------- TELEPHONE OPERATIONS Operating revenues Local service $ 188,464 - 188,464 186,248 - 186,248 1.2% 1.2% Network access 289,224 1,500 (1) 287,724 285,978 - 285,978 1.1% 0.6% Other 46,503 - 46,503 47,201 - 47,201 (1.5%) (1.5%) ------------------------------------ ------------------------------------ 524,191 1,500 522,691 519,427 - 519,427 0.9% 0.6% ------------------------------------ ------------------------------------ Operating expenses Plant operations 127,199 - 127,199 127,957 - 127,957 (0.6%) (0.6%) Customer operations 43,526 - 43,526 45,018 - 45,018 (3.3%) (3.3%) Corporate and other 70,351 7,500 (1) 62,851 56,655 - 56,655 24.2% 10.9% Depreciation and amortization 113,601 - 113,601 112,980 - 112,980 0.5% 0.5% ------------------------------------ ------------------------------------ 354,677 7,500 347,177 342,610 - 342,610 3.5% 1.3% ------------------------------------ ------------------------------------ Telephone operating income 169,514 (6,000) 175,514 176,817 - 176,817 (4.1%) (0.7%) ------------------------------------ ------------------------------------ OTHER OPERATIONS Operating revenues Long distance 42,916 - 42,916 40,665 - 40,665 5.5% 5.5% Internet 21,588 - 21,588 16,402 - 16,402 31.6% 31.6% Other 17,620 - 17,620 9,385 - 9,385 87.7% 87.7% ------------------------------------ ------------------------------------ 82,124 - 82,124 66,452 - 66,452 23.6% 23.6% ------------------------------------ ------------------------------------ Operating expenses Cost of sales and other 59,797 - 59,797 49,258 1,929 (4) 47,329 21.4% 26.3% Depreciation and amortization 5,380 - 5,380 4,901 - 4,901 9.8% 9.8% ------------------------------------ ------------------------------------ 65,177 - 65,177 54,159 1,929 52,230 20.3% 24.8% ------------------------------------ ------------------------------------ Other operating income 16,947 - 16,947 12,293 (1,929) 14,222 37.9% 19.2% ------------------------------------ ------------------------------------ TOTAL OPERATING INCOME 186,461 (6,000) 192,461 189,110 (1,929) 191,039 (1.4%) 0.7% OTHER INCOME (EXPENSE) Interest expense (60,842) (7,500)(1) (53,342) (57,019) - (57,019) 6.7% (6.4%) Income from unconsolidated cellular entity 1,265 - 1,265 1,730 - 1,730 (26.9%) (26.9%) Other income and expense 3,188 3,000 (2) 188 (63,458) (60,730)(5) (2,728) (105.0%) (106.9%) Income tax expense (47,630) 3,675 (3) (51,305) (26,018) 21,930 (6) (47,948) 83.1% 7.0% ------------------------------------ ------------------------------------ NET INCOME $ 82,442 (6,825) 89,267 44,345 (40,729) 85,074 85.9% 4.9% ==================================== ==================================== BASIC EARNINGS PER SHARE $ 0.57 (0.05) 0.62 0.31 (0.29) 0.60 83.9% 3.3% DILUTED EARNINGS PER SHARE $ 0.57 (0.05) 0.61 0.31 (0.28) 0.59 83.9% 3.4% SHARES OUTSTANDING Basic 144,204 144,204 142,465 142,465 1.2% 1.2% Diluted 145,354 145,354 143,380 143,380 1.4% 1.4% DIVIDENDS PER COMMON SHARE $ 0.0550 0.0550 0.0525 0.0525 4.8% 4.8%
NONRECURRING ITEMS (1) - Operating taxes, including related revenue effect, and interest associated with various operating tax audits. (2) - Reversal of costs previously accrued to defend unsolicited takeover proposal. (3) - Tax effect of items (1) and (2). (4) - Write-off costs associated with abandoned project. (5) - Redemption premium on remarketable notes, net of unamortized premium ($59.9 million), and write-off of nonoperating investment ($781,000). (6) - Tax effect of items (4) and (5). CenturyTel, Inc. CONSOLIDATED STATEMENTS OF INCOME TWELVE MONTHS ENDED DECEMBER 31, 2003 AND 2002 (UNAUDITED)
Twelve months ended December 31, 2003 Twelve months ended December 31, 2002 ------------------------------------- ------------------------------------- As adjusted As adjusted Increase Less excluding Less excluding (decrease) non- non- non- non- Increase excluding In thousands, except As recurring recurring As recurring recurring (decrease) nonrecurring per share amounts reported items items reported items items as reported items ------------------------------------- ------------------------------------- -------------------------- TELEPHONE OPERATIONS Operating revenues Local service $ 754,063 - 754,063 604,580 - 604,580 24.7% 24.7% Network access 1,135,223 1,500 (1) 1,133,723 972,303 (7,645)(4) 979,948 16.8% 15.7% Other 182,694 - 182,694 156,709 - 156,709 16.6% 16.6% ------------------------------------- ------------------------------------- 2,071,980 1,500 2,070,480 1,733,592 (7,645) 1,741,237 19.5% 18.9% ------------------------------------- ------------------------------------- Operating expenses Plant operations 505,786 - 505,786 433,187 433,187 16.8% 16.8% Customer operations 167,594 - 167,594 148,502 - 148,502 12.9% 12.9% Corporate and other 259,635 2,541 (1) 257,094 211,924 15,000 (5) 196,924 22.5% 30.6% Depreciation and amortization 450,851 - 450,851 396,866 - 396,866 13.6% 13.6% ------------------------------------- ------------------------------------- 1,383,866 2,541 1,381,325 1,190,479 15,000 1,175,479 16.2% 17.5% ------------------------------------- ------------------------------------- Telephone operating income 688,114 (1,041) 689,155 543,113 (22,645) 565,758 26.7% 21.8% ------------------------------------- ------------------------------------- OTHER OPERATIONS Operating revenues Long distance 173,884 - 173,884 146,536 - 146,536 18.7% 18.7% Internet 79,933 - 79,933 58,665 - 58,665 36.3% 36.3% Other 54,948 - 54,948 33,203 - 33,203 65.5% 65.5% ------------------------------------- ------------------------------------- 308,765 - 308,765 238,404 - 238,404 29.5% 29.5% ------------------------------------- ------------------------------------- Operating expenses Cost of sales and other 226,693 - 226,693 180,076 1,929 (6) 178,147 25.9% 27.3% Depreciation and amortization 19,790 - 19,790 14,760 - 14,760 34.1% 34.1% ------------------------------------- ------------------------------------- 246,483 - 246,483 194,836 1,929 192,907 26.5% 27.8% ------------------------------------- ------------------------------------- Other operating income 62,282 - 62,282 43,568 (1,929) 45,497 43.0% 36.9% ------------------------------------- ------------------------------------- Corporate overhead costs allocable to dis- continued operations - - - (11,275) - (11,275) (100.0%) (100.0%) ------------------------------------- ------------------------------------- TOTAL OPERATING INCOME 750,396 (1,041) 751,437 575,406 (24,574) 599,980 30.4% 25.2% OTHER INCOME (EXPENSE) Interest expense (226,751) (7,500)(1) (219,251) (221,845) - (221,845) 2.2% (1.2%) Income from unconsolidated cellular entity 6,160 - 6,160 5,582 - 5,582 10.4% 10.4% Nonrecurring gains and losses - - - 3,709 3,709 (7) - (100.0%) -% Other income and expense 2,154 3,000 (2) (846) (63,814) (63,730)(8) (84) (103.4%) 907.1% Income tax expense (187,252) 4,466 (3) (191,718) (105,505) 29,608 (9) (135,113) 77.5% 41.9% ------------------------------------- ------------------------------------- INCOME FROM CONTINUING OPERATIONS 344,707 (1,075) 345,782 193,533 (54,987) 248,520 78.1% 39.1% DISCONTINUED OPERATIONS, NET OF TAX - - - 608,091 531,625 (10) 76,466 (100.0%) (100.0%) ------------------------------------- ------------------------------------- NET INCOME $ 344,707 (1,075) 345,782 801,624 476,638 324,986 (57.0%) 6.4% ===================================== ===================================== BASIC EARNINGS PER SHARE From continuing operations $ 2.40 (0.01) 2.41 1.36 (0.39) 1.75 76.5% 37.7% From discontinued operations $ - - - 4.29 3.75 0.54 (100.0%) (100.0%) Basic earnings per share $ 2.40 (0.01) 2.41 5.66 3.37 2.29 (57.6%) 5.2% DILUTED EARNINGS PER SHARE From continuing operations $ 2.38 (0.01) 2.39 1.35 (0.38) 1.74 76.3% 37.4% From discontinued operations $ - - - 4.26 3.72 0.54 (100.0%) (100.0%) Diluted earnings per share $ 2.38 (0.01) 2.39 5.61 3.34 2.27 (57.6%) 5.3% SHARES OUTSTANDING Basic 143,583 143,583 141,613 141,613 1.4% 1.4% Diluted 144,700 144,700 142,879 142,879 1.3% 1.3% DIVIDENDS PER COMMON SHARE $ 0.2200 0.2200 0.2100 0.2100 4.8% 4.8%
NONRECURRING ITEMS (1) - Includes (i) operating taxes ($7.5 million), net of related revenue effect ($1.5 million), and interest cost ($7.5 million) associated with various operating tax audits and (ii) partial recovery of amounts previously written off in connection with WorldCom bankruptcy ($4.9 million; see Note 5). (2) - Reversal of costs previously accrued to defend unsolicited takeover proposal. (3) - Net out of period income tax adjustments ($2.5 million credit), net of tax effect of items (1) and (2). (4) - Reserve for refunds of access charges to interexchange carriers. (5) - Reserve for uncollectible receivables, primarily WorldCom. (6) - Write off costs associated with abandoned project. (7) - Gain on sale of PCS license. (8) - Redemption premium on remarketable notes, net of unamortized premium ($59.9 million); costs to defend unsolicited takeover proposal ($3.0 million); and write-off of nonoperating investment ($781,000). (9) - Tax effect of items (4) through (8). (10)- Gain on sale of wireless operations ($551.4 million after-tax), net of write down of wireless portion of billing system ($19.8 million after-tax). CenturyTel, Inc. CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2003 AND DECEMBER 31, 2002 (UNAUDITED)
Dec. 31, Dec. 31, 2003 2002 ---------------------------- (in thousands) ASSETS CURRENT ASSETS Cash and cash equivalents $ 203,181 3,661 Other current assets 259,758 292,241 ---------------------------- Total current assets 462,939 295,902 ---------------------------- PROPERTY, PLANT AND EQUIPMENT Telephone 6,596,600 6,347,900 Other 587,555 521,292 Accumulated depreciation (3,728,674) (3,337,547) ---------------------------- Net property, plant and equipment 3,455,481 3,531,645 ---------------------------- INVESTMENTS AND OTHER ASSETS Goodwill 3,425,001 3,427,281 Other 552,431 515,580 ---------------------------- Total investments and other assets 3,977,432 3,942,861 ---------------------------- TOTAL ASSETS $ 7,895,852 7,770,408 ============================ LIABILITIES AND EQUITY CURRENT LIABILITIES Current maturities of long-term debt $ 72,453 70,737 Other current liabilities 398,930 317,367 ---------------------------- Total current liabilities 471,383 388,104 LONG-TERM DEBT 3,109,302 3,578,132 DEFERRED CREDITS AND OTHER LIABILITIES 836,651 716,168 STOCKHOLDERS' EQUITY 3,478,516 3,088,004 ---------------------------- TOTAL LIABILITIES AND EQUITY $ 7,895,852 7,770,408 ============================
CAPITAL EXPENDITURES TWELVE MONTHS ENDED DECEMBER 31, 2003 AND 2002
Twelve months ended December 31, Increase 2003 2002 (decrease) ---------------------------------- ------------- (in thousands) CAPITAL EXPENDITURES Telephone $ 317,357 319,536 (0.7%) Wireless (discontinued operations) - 27,242 (100.0%) Other 60,582 66,731 (9.2%) ---------------------------------- Total capital expenditures $ 377,939 413,509 (8.6%) ==================================
CAPITAL EXPENDITURES THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002
Three months ended December 31, Increase 2003 2002 (decrease) ---------------------------------- ------------- (in thousands) CAPITAL EXPENDITURES Telephone $ 100,909 98,209 2.7% Other 20,571 17,284 19.0% ---------------------------------- Total capital expenditures $ 121,480 115,493 5.2% ==================================
CenturyTel, Inc. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)
Three months ended December 31, 2003 Three months ended December 31, 2002 ------------------------------------- -------------------------------------- As adjusted As adjusted Less excluding Less excluding non- non- non- non- As recurring recurring As recurring recurring reported items items reported items items ------------------------------------- -------------------------------------- Consolidated operating cash flow and cash flow margin Operating income $ 186,461 (6,000)(1) 192,461 189,110 (1,929)(3) 191,039 Add: Depreciation and amortization 118,981 118,981 117,881 - 117,881 ------------------------------------- -------------------------------------- Consolidated operating cash flow $ 305,442 (6,000) 311,442 306,991 (1,929) 308,920 ===================================== ====================================== Revenues $ 606,315 1,500 (1) 604,815 585,879 - 585,879 ===================================== ====================================== Consolidated cash flow margin (operating cash flow divided by revenues) 50.4% 51.5% 52.4% 52.7% =========== =========== =========== ============ Telephone operating cash flow, operating income margin and cash flow margin Telephone operating income $ 169,514 (6,000)(1) 175,514 176,817 - 176,817 Add: Depreciation and amortization 113,601 - 113,601 112,980 - 112,980 ------------------------------------- -------------------------------------- Telephone operating cash flow $ 283,115 (6,000) 289,115 289,797 - 289,797 ===================================== ====================================== Telephone revenues $ 524,191 1,500 (1) 522,691 519,427 - 519,427 ===================================== ====================================== Telephone operating income margin (operating income divided by revenues) 32.3% 33.6% 34.0% 34.0% =========== =========== =========== ============ Telephone cash flow margin (operating cash flow divided by revenues) 54.0% 55.3% 55.8% 55.8% =========== =========== =========== ============ Other Operations operating cash flow, operating income margin and cash flow margin Other Operations operating income $ 16,947 - 16,947 12,293 (1,929)(3) 14,222 Add: Depreciation and amortization 5,380 - 5,380 4,901 - 4,901 ------------------------------------- -------------------------------------- Other Operations operating cash flow $ 22,327 - 22,327 17,194 (1,929) 19,123 ===================================== ====================================== Other Operations revenues $ 82,124 - 82,124 66,452 - 66,452 ===================================== ====================================== Other Operations operating income margin (operating income divided by revenues) 20.6% 20.6% 18.5% 21.4% =========== =========== =========== ============ Other Operations cash flow margin (operating cash flow divided by revenues) 27.2% 27.2% 25.9% 28.8% =========== =========== =========== ============ Free cash flow (prior to debt service requirements and dividends) Net income $ 82,442 (6,825)(2) 89,267 44,345 (40,729)(4) 85,074 Add: Depreciation and amortization 118,981 - 118,981 117,881 - 117,881 Less: Capital expenditures (121,480) - (121,480) (115,493) - (115,493) ------------------------------------- -------------------------------------- Free cash flow $ 79,943 (6,825) 86,768 46,733 (40,729) 87,462 ===================================== ====================================== Free cash flow $ 79,943 46,733 Income from unconsolidated cellular entity (1,265) (1,730) Deferred income taxes 60,684 27,769 Changes in current assets and current liabilities 32,553 (35,340) Increase in other noncurrent assets (5,248) (6,981) Increase (decrease) in other noncurrent liabilities (1,361) 12,956 Retirement benefits (40,336) (18,046) Other, net (6,908) 17,541 Add: capital expenditures 121,480 115,493 ----------- ----------- Net cash provided by operating activities $ 239,542 158,395 =========== ===========
(1) Operating taxes ($7.5 million), including revenue effect ($1.5 million), associated with various operating tax audits. (2) Includes (i) interest cost ($4.9 million after-tax) related to operating tax audits; (ii) benefit from reversal of costs previously accrued to defend unsolicited takeover proposal ($2.0 million after-tax); and (iii) after tax effect of item (1) (3) Write off costs associated with abandoned project. (4) Redemption premium on remarketable notes, net of unamortized premium ($39.0 million after tax); write off costs associated with abandoned project ($1.3 million after tax); and write off of nonoperating investment ($508,000 after tax). CenturyTel, Inc. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)
Twelve months ended December 31, 2003 Twelve months ended December 31, 2002 ------------------------------------- -------------------------------------- As adjusted As adjusted Less excluding Less excluding non- non- non- non- As recurring recurring As recurring recurring reported items items reported items items ------------------------------------- -------------------------------------- Consolidated operating cash flow from continuing operations and cash flow margin Operating income $ 750,396 (1,041)(1) 751,437 575,406 (24,574)(3) 599,980 Add: Depreciation and amortization 470,641 470,641 411,626 - 411,626 ------------------------------------- -------------------------------------- Consolidated operating cash flow from continuing operations $ 1,221,037 (1,041) 1,222,078 987,032 (24,574) 1,011,606 ===================================== ====================================== Revenues from continuing operations $ 2,380,745 1,500 2,379,245 1,971,996 (7,645)(4) 1,979,641 ===================================== ====================================== Consolidated cash flow margin (operating cash flow divided by revenues) 51.3% 51.4% 50.1% 51.1% =========== =========== =========== ============ Telephone operating cash flow, operating income margin and cash flow margin Telephone operating income $ 688,114 (1,041)(1) 689,155 543,113 (22,645)(3) 565,758 Add: Depreciation and amortization 450,851 - 450,851 396,866 - 396,866 ------------------------------------- -------------------------------------- Telephone operating cash flow $ 1,138,965 (1,041) 1,140,006 939,979 (22,645) 962,624 ===================================== ====================================== Telephone revenues $ 2,071,980 1,500 2,070,480 1,733,592 (7,645)(4) 1,741,237 ===================================== ====================================== Telephone operating income margin (operating income divided by revenues) 33.2% 33.3% 31.3% 32.5% =========== =========== =========== ============ Telephone cash flow margin (operating cash flow divided by revenues) 55.0% 55.1% 54.2% 55.3% =========== =========== =========== ============ Other Operations operating cash flow, operating income margin and cash flow margin Other Operations operating income $ 62,282 - 62,282 43,568 (1,929) 45,497 Add: Depreciation and amortization 19,790 - 19,790 14,760 - 14,760 ------------------------------------- -------------------------------------- Other Operations operating cash flow $ 82,072 - 82,072 58,328 (1,929) 60,257 ===================================== ====================================== Other Operations revenues $ 308,765 - 308,765 238,404 - 238,404 ===================================== ====================================== Other Operations operating income margin (operating income divided by revenues) 20.2% 20.2% 18.3% 19.1% =========== =========== =========== ============ Other Operations cash flow margin (operating cash flow divided by revenues) 26.6% 26.6% 24.5% 25.3% =========== =========== =========== ============ Free cash flow (prior to debt service requirements and dividends) Net income $ 344,707 (1,075)(2) 345,782 801,624 476,638 (6) 324,986 Add: Depreciation and amortization (7) 470,641 - 470,641 424,520 - 424,520 Less: Capital expenditures (7) (377,939) - (377,939) (413,509) - (413,509) ------------------------------------- -------------------------------------- Free cash flow $ 437,409 (1,075) 438,484 812,635 476,638 335,997 ===================================== ====================================== Free cash flow $ 437,409 812,635 Income from discontinued operations, net of tax - (608,091) Less: depreciation and amortization of discontinued operations - (12,894) Nonrecurring gains and losses - (3,709) Income from unconsolidated cellular entity (6,160) (5,582) Deferred income taxes 128,706 71,112 Changes in current assets and current liabilities 160,984 69,650 Increase in other noncurrent assets (23,528) (30,543) Increase (decrease) in other noncurrent liabilities (6,151) 35,489 Retirement benefits (14,739) (9,416) Other, net 13,504 61,274 Add: capital expenditures 377,939 413,509 ----------- ----------- Net cash provided by operating activities from continuing operations $ 1,067,964 793,434 =========== ===========
(1) Operating taxes ($7.5 million), net of related revenue effect ($1.5 million), associated with various operating tax audits, net of partial recovery of amounts previously written off in connection with WorldCom bankruptcy ($4.9 million; see Note 3). (2) Includes (i) interest cost ($4.9 million after-tax) related to operating tax audits; (ii) benefit from reversal of costs previously accrued to defend unsolicited takeover proposal ($2.0 million after-tax); (iii) net out of period income tax adjustments ($2.5 million credit); and (iv) after-tax effect of item (1). (3) Reserve for refunds of access charges to interexchange carriers ($7.6 million) and reserve for uncollectible receivables, primarily WorldCom ($15.0 million). (4) Reserve for refunds of access charges to interexchange carriers. (5) Write off costs associated with abandoned project. (6) Includes gain on sale of wireless operations ($551.4 million after tax) and gain on sale of a PCS license ($2.4 million after tax). Such favorable items were partially offset by unfavorable charges for reserve for refunds of access charges to interexchange carriers ($5.0 million after tax), reserve for uncollectible receivables, primarily WorldCom ($9.8 million after tax), costs to defend unsolicited takeover proposal ($2.0 million after tax) and write down of wireless portion of billing system ($19.8 million after tax). (7) Includes discontinued operations for 2002. SIGNATURE 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. CenturyTel, Inc. January 29, 2004 By: /s/ Neil A. Sweasy ---------------------- Neil A. Sweasy Vice President and Controller -----END PRIVACY-ENHANCED MESSAGE-----