-----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, HtEm91JhjtQ7bWb+RxpTsHuGFOeNF77rzQn4c1lAl3a/Zu4T2/DhuzrMCIc33nWn DzlSJk9qjR38BMTFW7zyOg== 0000020520-97-000008.txt : 19970505 0000020520-97-000008.hdr.sgml : 19970505 ACCESSION NUMBER: 0000020520-97-000008 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970502 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CITIZENS UTILITIES CO CENTRAL INDEX KEY: 0000020520 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 060619596 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-11001 FILM NUMBER: 97594341 BUSINESS ADDRESS: STREET 1: HIGH RIDGE PK BLDG 3 STREET 2: P O BOX 3801 CITY: STAMFORD STATE: CT ZIP: 06905 BUSINESS PHONE: 2033298800 MAIL ADDRESS: STREET 1: HIGH RIDGE PARK BLDG NO 3 CITY: STAMFORD STATE: CT ZIP: 06905 8-K/A 1 LETTER TO SHAREHOLDERS SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: March 31, 1997 (Date of earliest event reported) CITIZENS UTILITIES COMPANY (Exact name of Registrant as specified in charter) Delaware 001-11001 06-0619596 (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) High Ridge Park, P.O. Box 3801, Stamford, Connecticut 06905 - ----------------------------------------------------- ----- (Address of principal executive offices) (Zip Code) (203) 329-8800 (Registrant's telephone number, including area code) No change since last report (Former name or address, if changed since last report) Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (c) Exhibits 99.3 Letter to Shareholders dated April 30, 1997 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 hereunto duly authorized. CITIZENS UTILITIES COMPANY Registrant By:/s/ Livingston E. Ross Vice President and Controller Date: May 2, 1997 EX-99 2 SHAREHOLDER LETTER EXHIBIT 99.3 April 30, 1997 Fellow Shareholder, The enclosed press release contains highlights of our 1997 first-quarter results. First-Quarter Results As you will read in the enclosed press release, Citizens enjoyed healthy revenue increases for the first quarter of 1997 over the corresponding period in 1996. However, earnings and earnings per share for the quarter were lower than those of the corresponding 1996 quarter. Revenue increases were the direct result of aggressive investment and sales and marketing activities in the expansion of Citizens' Electric Lightwave and Citizens Communications. Another important investment, our new image and branding campaign for Citizens Communications (formerly Citizens Telecom), which features a new name and logo supported by print, radio and television advertising, is aimed at boosting company recognition in our franchise territories and adjacent areas. Increased brand name recognition is crucial to the success of our in-market and out-of-market competitive telecommunications strategy. Results in Perspective While we experienced substantial increases in revenue, 1997 first-quarter earnings were adversely affected by the large operating and capital expenditures and expenses associated with our increased sales and marketing activities, and network acquisition and construction costs related to the expansion of our telecommunications operations. The impact of such large new expenditures on earnings is not unique to Citizens, but has been experienced by other peer companies which are also revamping their technological infrastructure and retooling their culture to prepare for new opportunities. The market today is demanding more and more of the services we are providing. In order to continue to address customer demand promptly, we must put in place the systems, products and enhancements they want. If we do not, another provider will be all too ready to fill the need. As I shared with you in our 1996 annual report, we planned large expenditures in 1997 for such purposes. As I also stated, Citizens' evolution into a full-service communications company has been hard work, and that work is not yet over. It will continue to require significant expenditure during the remainder of the year in order to more fully develop, build and support the network and systems necessary to grow our businesses. This investment, which will have an impact on 1997 and 1998 earnings, is crucial to sustaining the robust revenue and earnings growth that has characterized the company for so many years. Citizens Communications and Citizens' Electric Lightwave's rapidly growing revenue streams demonstrate that they deserve additional funding. Branding To succeed in an open and competitive marketplace, our networks need to be the state-of-the-art and our people alert to every opportunity. Customers must know who we are and what we can offer. As a result, our strategy today is focused on building and marketing a line of branded telecommunications products, including local and long distance, cellular, videoconferencing, conference calling, paging and more. Companies like AT&T, MCI and Sprint with great name recognition have spent hundreds of millions of dollars on advertising and promotion. Our Strategy Citizens is not trying to compete with these giants in terms of dollars spent. Our strategy remains simple, though it is not without cost. It involves focusing our spending on second- and third-tier markets which are experiencing population and job growth rates above the national norm. These are the markets where we have community-based operations and a strong reputation. This is where we will concentrate our marketing of products and services branded with the Citizens name. Our plan is to move into adjacent markets only where we can use a locally based telemarketing and sales force. We are deploying an extensive national distribution network to serve as a pipeline for our products and services. Today we are carrying voice, video and data traffic over thousands of miles of leased or owned network that criss-crosses the United States. This national distribution network is comprised of our local exchange and long-distance facilities and those of Citizens' Electric Lightwave (ELI), our competitive local exchange company. Today, ELI serves the Phoenix, Portland, Seattle, Sacramento, and Salt Lake City metropolitan areas with a full range of telecommunications services, including high-speed voice, data and video transmission services over fiber-optic networks. ELI's continued expansion into other cities in the West is central to our strategy. Several other major initiatives that are requiring substantial expenditures are underway and will also contribute to lowering 1997 earnings, compared to 1996, but are nonetheless essential to achieving future record earnings. Among these are: 1) the installation of a new uniform billing and customer care system to address the inefficiencies of the multiple systems inherited with the acquisition of the former GTE and ALLTEL properties; 2) a Financial Group initiative to dramatically upgrade our in-house information technology, allowing for flexible and more efficient recording and reporting practices at multiple locations as well as providing more timely information to our financial and operations managers, shareholders and the financial community; and 3) branding and related identity projects for Citizens Utilities, Citizens Public Services, and Citizens' Electric Lightwave. Looking Ahead The Board of Directors and management have made the hard choices necessary for the continued good health of this remarkable company. Citizens' earnings from operations continue to remain very sound and the company remains in excellent financial condition. The actions being taken will improve our ability to earn through the introduction of new products and services, growing our markets while we address competition and evolving conditions in our traditional markets. It is those who are most responsive to change who will thrive in this newly competitive world. I will continue to keep you informed of our progress. All of us at Citizens remain committed to doing our best to create value for our shareholders, customers and employees. Sincerely, Leonard Tow Chairman Enclosure -----END PRIVACY-ENHANCED MESSAGE-----