-----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, VgE15WjEfitRx6EFIHEm4iO/OmhPFJXh5xoV9UkqmMjn2LMiZXqumDaQbrUUgEjG 6IFf9lXyuIBESDPbl1aj8A== 0000732718-97-000002.txt : 19970502 0000732718-97-000002.hdr.sgml : 19970502 ACCESSION NUMBER: 0000732718-97-000002 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 18 CONFORMED PERIOD OF REPORT: 19961231 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970218 SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: US WEST INC CENTRAL INDEX KEY: 0000732718 STANDARD INDUSTRIAL CLASSIFICATION: 4813 IRS NUMBER: 840926774 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08611 FILM NUMBER: 97537094 BUSINESS ADDRESS: STREET 1: 7800 E ORCHARD RD STREET 2: SUITE 480 CITY: ENGLEWOOD STATE: CO ZIP: 80111 BUSINESS PHONE: 3037936629 MAIL ADDRESS: STREET 1: 7800 EAST ORCHARD ROAD STREET 2: SUITE 480 CITY: ENGLEWOOD STATE: CO ZIP: 80111 8-K 1 FORM 8-K 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): February 12, 1997 U S WEST, Inc. (Exact name of registrant as specified in its charter) A Delaware Corporation Commission File IRS Employer Identification (State of incorporation) Number 1-8611 No. 84-0926774 7800 East Orchard Road, Englewood, Colorado 80111 (Address of principal executive offices) Telephone Number (303) 793-6500 (Registrant's telephone number, including area code) Item 5. Other Events On February 12, 1997, U S WEST Communications Group released its fourth quarter earnings results. In addition, U S WEST Media Group released its fourth quarter earnings results on February 13, 1997. The releases and financial statements are attached hereto as Exhibits. Item 7. Exhibits Exhibit Description - - ------- ----------- 27 Financial Data Schedule. 99A Press Release issued February 12, 1997 concerning the earnings results of U S WEST Communications Group for the fourth quarter of 1996. 99A.1 Unaudited Combined Statements of Income of U S WEST Communications Group for the quarters ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 12, 1997. 99A.2 Unaudited Earnings Normalization Schedule of U S WEST Communications Group for the quarters ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 12, 1997. 99A.3 Unaudited Selected Combined Group Data of U S WEST Communications Group for the quarters ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 12, 1997. 99A.4 Unaudited Combined Balance Sheets of U S WEST Communications Group for the years ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 12, 1997. 99A.5 Unaudited Combined Statements of Cash Flows of U S WEST Communications Group for the years ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 12, 1997. 99A.6 Unaudited Statements of Income of U S WEST Communications, Inc. for the quarters ended December 31, 1995 and 1996 and years ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 12, 1997. 99B Press Release issued February 13, 1997 concerning the earnings results of U S WEST Media Group for the fourth quarter of 1996. 99B.1 Unaudited Combined Statements of Operations of U S WEST Media Group for the quarters ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 13, 1997. 99B.2 Unaudited Selected Combined Group Data of U S WEST Media Group for the quarters ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 13, 1997. 99B.3 Unaudited Combined Balance Sheets of U S WEST Media Group for the years ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 13, 1997. 99B.4 Unaudited Selected Proportionate Data of U S WEST Media Group for the quarter periods ended December 31, 1995 and 1996, filed in connection with the Press Release dated February 13, 1997. 99C.1 Unaudited Consolidated Statements of Income of U S WEST, Inc. for the quarter periods ended December 31, 1995 and 1996. 99C.2 Unaudited Consolidated Balance Sheets of U S WEST, Inc. for the year ended December 31, 1995 and 1996. 99C.3 Unaudited Consolidated Statements of Cash Flows of U S WEST, Inc. for the year ended December 31, 1995 and 1996. 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 hereunto duly authorized. U S WEST, Inc. /s/ STEPHEN E. BRILZ By:___________________________ Stephen E. Brilz Assistant Secretary Dated: February 17, 1997 EX-99 2 EXHIBIT 99A EXHIBIT 99A U S WEST Communications, Inc. 1801 California Street Denver, CO 80202 [U S WEST Communications logo and registered mark] News Release Release Date: February 12, 1997 Contact: Dave Banks, 303-804-6752 SOLID 4TH QUARTER OPERATIONS, RECORD ANNUAL GROWTH GENERATE STRONG FINANCIAL RESULTS FOR U S WEST COMMUNICATIONS GROUP ENGLEWOOD, Colo. -- Bolstered by accelerating revenue growth, strong marketing successes, access line gains, and tighter controls on employee related expenses, U S WEST Communications Group reported fourth quarter normalized net income of $304 million, an increase of 11.8 percent over 1995, and normalized earnings per share of $.63, up 10.5 percent over 1995. For the year, normalized net income grew 5.1 percent, to $1.16 billion from $1.11 billion in 1995. Normalized full-year EPS for 1996 was up 3.8 percent to $2.44 from $2.35 in 1995. Fourth quarter and year-end highlights included the following: - - - For the quarter, revenues rose 6.6 percent (to $2.6 billion) over fourth quarter, 1995 -- including an 11.2 percent gain in local service revenues from $1.11 billion in fourth quarter, 1995 to $1.24 billion in fourth quarter, 1996. Annual operating revenues were up 6.3 percent over 1995, to $10.1 billion from $9.5 billion. - - - U S WEST Communications Group added a record 742,000 access lines in 1996, 26 percent more than it added in 1995. The company now has more than 15.4 million access lines in service, 5.0 percent more than at the end of 1995 adjusted for the sale of certain rural exchanges. This annual growth rate includes a 7.6 percent increase for business lines, a 4.0 percent increase for residential lines, and a gain of 30.8 percent for residential additional lines. - - - Strong access line growth, coupled with telephone company employee reductions of more than 2,500 for the year, drove the employees-per-10,000-access-lines figure for the company's telephone operations below 30 for the first time. It dropped 9 percent for the year from 32.4 at the end of 1995 to 29.5 at the end of 1996. - - - Operating expense growth slowed for the second consecutive quarter, rising just 5.0 percent. - - - Service quality improved to the best levels of the 1990s, showing marked gains for the year. For instance, orders "Held" more than 30 days for primary service at the end of 1996 were 864, less than half of the 1,887 at the end of 1995. Also, 90 percent of the company's customers now reach a customer service representative within three rings. "U S WEST Communications Group made excellent progress in all areas of the business during 1996, particularly in the fourth quarter," said Richard McCormick, chairman and chief executive officer of U S WEST, Inc. "Top-line results are starting to pay off on the bottom line. That tells me we turned the corner in many respects in 1996 and can now enter 1997 with momentum and a real sense of optimism." "These are the best quarterly results we've had in several years," said Sol Trujillo, president and CEO of U S WEST Communications Group. "We had a very successful 1996 -- our marketing effort produced record growth, we drove costs out of the business with productivity gains and capital efficiencies, and we made good on our promise to dramatically improve our customer service. "I'm very pleased with our fourth quarter results," Trujillo added. "They show -- as we planned -- that our top-line growth is flowing to the bottom line as we aggressively become more efficient and tighten management disciplines throughout the business." Other highlights for the quarter and year include: - - - A reduction in employee overtime expenses of $24 million -- or 42 percent -- in the fourth quarter, 1996 versus the same period in 1995. - - - Continued strong revenue growth in new products, such as Caller ID, Voice Messaging and data networking services, up approximately 57 percent for the year. Residential penetration levels for the company's top-selling value-added services continued to show strength: Call Waiting, 36.9 percent; Caller ID, 20.5 percent; Voice Messaging, 16 percent. - - - Improved capital efficiency by reducing the cost per access line added by 27 percent over 1995. This allowed the company to keep 1996 capital expenditures at 1995 levels even with a 26 percent increase in the number of access lines gained during the year, as compared with 1995. - - - The company's large business division improved revenues by 13.6 percent for the year to $1.6 billion, while winning 110 contracts over $1 million -- some 80 percent of the contracts for which it competed. - - - Revenues from the company's data networking division, !NTERPRISE, were up $123 million for the year, more than a 100 percent gain over 1995 revenues. !NTERPRISE continued to rapidly deploy its leading-edge Frame Relay network, and by year-end, had more than 38,500 Frame Relay ports in service. Just recently, that division announced it would become the first company in the nation to widely deploy commercial Digital Subscriber Line (DSL) services. These services initially will serve businesses' remote-access needs. - - - Results of a study released late last year by the respected Boston-based research firm, The Yankee Group, showed that U S WEST Communications scores higher than any other RBOC in customer loyalty and better than AT&T in its territory. - - - In early January, U S WEST Communications acquired nearly 20 million PCS POPs in recently concluded auctions of D&E block spectrum. These licenses will allow the company to provide integrated, digital wireless services to the majority of the major markets in its 14-state region. U S WEST Communications paid $2.88 per POP -- the lowest price per POP of any of the previous spectrum bidders. U S WEST Communications Group provides telecommunications and high-speed data services to more than 25 million customers in 14 western and midwestern states. The company is one of two major groups that make up U S WEST. U S WEST is in the connections business, helping customers share information, entertainment and communications services in local markets worldwide. U S WEST's other major group, U S WEST Media Group (NYSE:UMG), is involved in domestic and international cable and wireless networks, directory publishing and interactive multimedia services. - - ------------------------- [Safe Harbor statement: Some of the information presented in or in connection with this announcement constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes that its expectations are based on reasonable assumptions within the bounds of its knowledge of its business and operations, there can be no assurance that actual results will not differ materially from its expectations. Factors that could cause actual results to differ from expectations include: (i) different than anticipated competition from new entrants into the local exchange and intralata toll markets, (ii) changes in demand for the Company's products and services, including optional custom calling features, (iii) different than anticipated employee levels, capital expenditures, and operating expenses as a result of unusually rapid, in-region growth, (iv) the gain or loss of significant customers, (v) pending regulatory actions in state jurisdictions, and (vi) regulatory changes affecting the telecommunications industry, including changes that could have an impact on the competitive environment in the local exchange market.] - ### - Note: This release and the attached tables are available on the internet by accessing U S WEST's internet site: www.uswest.com. EX-99 3 EXHIBIT 99A1 EXHIBIT 99A.1
COMBINED STATEMENTS OF INCOME U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Year Ended December 31, % December 31, % In millions 1996 1995 Change 1996 1995 Change - - -------------------------------- ------- ------------- ------- ------ OPERATING REVENUES Local service $1,238 $1,113 11.2 $4,770 $4,344 9.8 Interstate access 653 604 8.1 2,507 2,378 5.4 Intrastate access 199 189 5.3 770 747 3.1 Long-distance network 260 298 (12.8) 1,100 1,189 (7.5) Other services 249 235 6.0 932 826 12.8 ---------------- ---------------- Total operating revenues 2,599 2,439 6.6 10,079 9,484 6.3 ---------------- ---------------- OPERATING EXPENSES Employee-related 906 862 5.1 3,594 3,341 7.6 Other operating 457 444 2.9 1,634 1,543 5.9 Taxes other than income taxes 98 74 32.4 389 380 2.4 Depreciation & amort 542 528 2.7 2,122 2,042 3.9 ---------------- ---------------- Total operating expenses 2,003 1,908 5.0 7,739 7,306 5.9 ---------------- ---------------- Income from operations 596 531 12.2 2,340 2,178 7.4 Interest expense 113 112 0.9 445 427 4.2 Gains on sales of rural telephone exchanges 8 24 (66.7) 59 136 (56.6) Other expense - net 19 11 72.7 41 41 - ---------------- ---------------- Income before inc taxes, extd item & cum effect of chg in acctg princ 472 432 9.3 1,913 1,846 3.6 Income tax provision 161 148 8.8 698 662 5.4 ---------------- ---------------- Income before extd item & cum effect of chg in acctg princ 311 284 9.5 1,215 1,184 2.6 Extraordinary item: Early extinguishment of debt, net of tax - (3) - - (8) - ---------------- ---------------- Income before cum effect of chg in acctg princ 311 281 10.7 1,215 1,176 3.3 Cum effect of chg in acctg princ, net of tax - - - 34 - - ---------------- ---------------- NET INCOME $311 $281 10.7 $1,249 $1,176 6.2 ================ ================
COMBINED STATEMENTS OF INCOME U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Year Ended In millions, except December 31, % December 31, % per share amounts 1996 1995 Change 1996 1995 Change - - -------------------------------- ------- ------------- ------- ------ Average common shares outstanding (1) 479.9 472.6 1.5 477.5 470.7 1.4 ================ ================ Earnings per common share: (1) Income before extraordi- nary item & cumulative effect of change in accounting principle $0.65 $0.60 8.3 $2.55 $2.52 1.2 Extraordinary item - (0.01) - - (0.02) - Cumulative effect of change in accounting principle - - - 0.07 - - ---------------- ---------------- Earnings per common share $0.65 $0.59 10.2 $2.62 $2.50 4.8 ================ ================ 1: Effective November 1, 1995, each share of U S WEST, Inc. common stock was converted into one share each of U S WEST Communi- cations Group common stock and U S WEST Media Group common stock. Earnings per common share for 1995 have been presented on a pro forma basis to reflect the two classes of stock as if they were outstanding since January 1, 1995. For periods prior to the recapitalization, the average common shares outstanding are assumed to be equal to the average common shares outstanding for U S WEST, Inc.
EX-99 4 EXHIBIT 99A2 EXHIBIT 99A.2
EARNINGS NORMALIZATION SCHEDULE U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Year Ended In millions, except December 31, % December 31, % per share amounts 1996 1995 Change 1996 1995 Change - - -------------------------------- ------- ------------- ------- ------ NORMALIZED INCOME: Reported net income $311 $281 10.7 $1,249 $1,176 6.2 Adjustments to normalize net income: Rural exchange sales (5) (15)(66.7) (36) (85)(57.6) Recapitalization costs - 3 - - 8 - Extraordinary item - net of tax - 3 - - 8 - Cumulative effect of change in accounting principle-net of tax - - - (34) - - Current year impact of accounting change - net of tax (2) - - (15) - - ---------------- ---------------- Normalized income $304 $272 11.8 $1,164 $1,107 5.1 ================ ================ NORMALIZED EARNINGS PER COMMON SHARE: Reported net income $0.65 $0.59 10.2 $2.62 $2.50 4.8 Adjustments to normalize net income: Rural exchange sales (0.01) (0.03)(66.7) (0.08) (0.18)(55.6) Recapitalization costs - - - - 0.01 - Extraordinary item - net of tax - 0.01 - - 0.02 - Cumulative effect of change in accounting principle-net of tax - - - (0.07) - - Current year impact of accounting change - net of tax (0.01) - - (0.03) - - ---------------- ---------------- Normalized earnings per common share $0.63 $0.57 10.5 $2.44 $2.35 3.8 ================ ================
EX-99 5 EXHIBIT 99A3 EXHIBIT 99A.3
SELECTED COMBINED GROUP DATA U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Year Ended In millions, except December 31, % December 31, % per share amounts 1996 1995 Change 1996 1995 Change - - ------------------------------- ------- ------------- ------- ------ Access lines (thousands) (1): Business 4,543 4,242 7.1 4,543 4,242 7.1 Consumer 10,881 10,553 3.1 10,881 10,553 3.1 Total access lines 15,424 14,795 4.3 15,424 14,795 4.3 Normalized access lines 15,537 14,795 5.0 15,537 14,795 5.0 Billed access minutes of use (millions): Interstate 13,365 12,300 8.7 52,039 47,801 8.9 Intrastate 2,643 2,516 5.0 10,451 9,504 10.0 Total minutes of use 16,008 14,816 8.0 62,490 57,305 9.0 Employees: Communications Grp 48,037 50,825 (5.5) 48,037 50,825 (5.5) Telephone operations 45,427 47,934 (5.2) 45,427 47,934 (5.2) Telephone employees per 10,000 access lines 29.5 32.4 (9.0) 29.5 32.4 (9.0) Dividends per common share (2) $0.535 $0.535 - $2.14 $2.14 - Common shares outstanding 480.5 473.6 1.5 480.5 473.6 1.5 Capital expenditures $798 $816 (2.2) $2,806 $2,739 2.4 EBITDA (3) $1,138 $1,059 7.5 $4,462 $4,220 5.7 EBITDA margin 43.8% 43.4% - 44.3% 44.5% - Return on equity(4) 31.5% 34.2% - 32.0% 35.6% - Debt-to-capital ratio: Communications Grp 62.4% 66.0% - 62.4% 66.0% - Telephone operations only 60.5% 63.1% - 60.5% 63.1% - 1: 1995 access lines have been restated to conform to current year presentation. 2: Effective November 1, 1995, each share of U S WEST, Inc. common stock was converted into one share each of U S WEST Communi- cations Group common stock and U S WEST Media Group common stock. The dividends per common share for 1995 are presented on a pro forma basis. 3: Earnings before interest, taxes, depreciation, amortization, and other (EBITDA). EBITDA also excludes gains on asset sales. 4: Based on income before one time items.
EX-99 6 EXHIBIT 99A4 EXHIBIT 99A.4
COMBINED BALANCE SHEETS U S WEST COMMUNICATIONS GROUP (UNAUDITED) December 31, In millions 1996 1995 - - -------------------------------------- --------------------------- ASSETS Current assets: Cash and cash equivalents $80 $172 Accounts and notes receivable 1,622 1,617 Inventories and supplies 144 193 Deferred tax asset 97 259 Prepaid and other 65 51 --------------------------- Total current assets 2,008 2,292 --------------------------- Gross property, plant and equipment 32,645 31,178 Accumulated depreciation 18,639 17,649 --------------------------- Property, plant and equipment - net 14,006 13,529 Other assets 827 764 --------------------------- Total assets $16,841 $16,585 =========================== LIABILITIES AND EQUITY Current liabilities: Short-term debt $834 $1,065 Accounts payable 989 851 Dividends payable 257 254 Other 1,387 1,437 --------------------------- Total current liabilities 3,467 3,607 --------------------------- Long-term debt 5,664 5,689 Postretirement and other postemployment benefit obligations 2,387 2,351 Deferred taxes, credits and other 1,406 1,462 Communications Group equity 3,917 3,476 --------------------------- Total liabilities and equity $16,841 $16,585 ===========================
EX-99 7 EXHIBIT 99A5 EXHIBIT 99A.5
COMBINED STATEMENTS OF U S WEST COMMUNICATIONS GROUP CASH FLOWS (UNAUDITED) Year Ended December 31, In millions 1996 1995 - - --------------------------------------------------------------------- OPERATING ACTIVITIES Net income $1,249 $1,176 Adjustments to net income: Depreciation and amortization 2,122 2,042 Gains on sales of rural telephone exchanges (59) (136) Cumulative effect of change in accounting principle (34) - Deferred income taxes and amortization of investment tax credits 91 172 Changes in operating assets and liabilities: Restructuring payments (226) (315) Postretirement medical and life costs, net of cash fundings 28 (90) Accounts and notes receivable (5) (117) Inventories, supplies and other 27 (51) Accounts payable and accrued liabilities 98 7 Other - net 15 31 - - --------------------------------------------------------------------- Cash provided by operating activities 3,306 2,719 - - --------------------------------------------------------------------- INVESTING ACTIVITIES Expenditures for property, plant and equipment (2,419) (2,462) Proceeds from sales of rural telephone exchanges 174 214 Proceeds from (payments on) disposals of property, plant and equipment 15 (18) Other - net - (2) - - --------------------------------------------------------------------- Cash (used for) investing activities (2,230) (2,268) - - --------------------------------------------------------------------- FINANCING ACTIVITIES Net (repayments of) proceeds from issuance of short-term debt 96 (832) Proceeds from issuance of long-term debt 23 1,647 Repayments of long-term debt (482) (334) Dividends paid on common stock (939) (926) Proceeds from issuance of common stock 134 50 - - --------------------------------------------------------------------- Cash (used for) financing activities (1,168) (395) - - --------------------------------------------------------------------- CASH AND CASH EQUIVALENTS Increase (decrease) (92) 56 Beginning balance 172 116 - - --------------------------------------------------------------------- Ending balance $80 $172 =====================================================================
EX-99 8 EXHIBIT 99A6 EXHIBIT 99A.5
STATEMENTS OF INCOME U S WEST COMMUNICATIONS, Inc. (UNAUDITED) (Telephone Operations Only) Quarter Ended Year Ended December 31, % December 31, % In millions 1996 1995 Change 1996 1995 Change - - -------------------------------- ------- ------------- ------- ------ OPERATING REVENUES Local service $1,238 $1,113 11.2 $4,770 $4,344 9.8 Interstate access 653 604 8.1 2,507 2,378 5.4 Intrastate access 199 189 5.3 770 747 3.1 Long-distance network 260 298 (12.8) 1,100 1,189 (7.5) Other services 177 171 3.5 684 626 9.3 ---------------- ---------------- Total operating revenues 2,527 2,375 6.4 9,831 9,284 5.9 ---------------- ---------------- OPERATING EXPENSES Employee-related* 852 802 6.2 3,377 3,079 9.7 Other operating* 426 428 (0.5) 1,574 1,587 (0.8) Taxes other than income taxes 95 72 31.9 379 371 2.2 Depreciation & amort 536 523 2.5 2,101 2,022 3.9 ---------------- ---------------- Total operating expenses 1,909 1,825 4.6 7,431 7,059 5.3 ---------------- ---------------- Income from operations 618 550 12.4 2,400 2,225 7.9 Interest expense 106 102 3.9 414 386 7.3 Gains on sales of rural telephone exchanges 8 24 (66.7) 59 136 (56.6) Other expense - net 19 15 26.7 44 58 (24.1) ---------------- ---------------- Income before inc taxes, extd item & cum effect of chg in acctg princ 501 457 9.6 2,001 1,917 4.4 Income tax provision 194 155 25.2 768 698 10.0 ---------------- ---------------- Income before extd item & cum effect of chg in acctg princ 307 302 1.7 1,233 1,219 1.1 Extraordinary item: Early extinguishment of debt, net of tax - (3) - - (8) - ---------------- ---------------- Income before cum effect of chg in acctg princ 307 299 2.7 1,233 1,211 1.8 Cum effect of chg in acctg princ, net of tax - - - 34 - - ---------------- ---------------- NET INCOME $307 $299 2.7 $1,267 $1,211 4.6 ================ ================ *Employee-related expenses for the year ended December 31, 1996 include the impacts of employee transfers from affiliated Communications Group companies to U S WEST Communications, Inc. (USWC) during the first half of 1995. Prior to the transfers, these affiliate employee costs were billed to USWC and reflected as affiliate expense, which is included in other operating expenses.
EX-99 9 EXHIBIT 99B EXHIBIT 99B U S WEST Media Group 7800 East Orchard Road Englewood, Colorado 80111 303 793-6500 [U S WEST Media Group logo and registered mark] News Release Release Date: February 13, 1997 Contact: Blair Johnson Steve Lang (303) 793-6296 (303) 793-6290 U S WEST MEDIA GROUP REPORTS 22 PERCENT INCREASE IN OPERATING CASH FLOW IN 1996 ENGLEWOOD, Colo. - U S WEST Media Group (NYSE: UMG) today reported operating cash flow growth of more than 20 percent for the fifth consecutive quarter, results fueled by industry-leading growth in its cable TV, wireless and directory operations. For the fourth quarter, Media Group reported $415 million of proportionate operating cash flow, a 29.5 percent normalized increase over the fourth quarter of 1995. Other highlights of 1996, Media Group's first full year, included: - - - Merging with Continental Cablevision, which made Media Group the third largest cable operator in the United States. - - - Offering high-speed Internet access through cable modems and cable TV lines in certain Boston suburbs, Jacksonville, Fla., and -- beginning this week -- the Detroit area. - - - Repurchasing $350 million worth, or 19 million shares, of Media Group stock in a buyback started in 1996. - - - Launching, with its PrimeCo Personal Communications partners, a new generation of wireless telephone service, called PCS, in 16 U.S. cities. In addition, strong market demand last month enabled U S WEST to sell $4.1 billion in bonds -- twice its initial offering -- in the largest investment-grade debt transaction ever. For the year ending December 31, 1996, Media Group reported -- on a proportionate basis: - A 22 PERCENT INCREASE IN OPERATING CASH FLOW, to $1.4 billion, not including results from Continental Cablevision since the Nov. 15 merger. Media Group's operating cash flow for 1995 was $1.15 billion. Including Continental's results since Nov. 15, Media Group's 1996 operating cash flow was $1.47 billion. Operating cash flow, which represents earnings before interest, taxes, depreciation and amortization (EBITDA), is an important indicator of the company's operating performance. - A 19 PERCENT INCREASE IN REVENUE, to $6.1 billion, not including results from Continental. Media Group's revenue for 1995 was $5.1 billion. Including Continental's results since Nov. 15, Media Group's 1996 revenue was $6.4 billion. - - - A 17 PERCENT INCREASE IN CUSTOMERS WORLDWIDE, not including those added in the Continental merger. Including Continental's 4.9 million customers, Media Group now serves 11.9 million customers on a proportionate basis. Because Media Group participates in numerous joint ventures, the company uses proportionate accounting to reflect its relative share of operating revenues and expenses associated with these operations. For 1996, Media Group reported a net loss of $71 million. Excluding Continental, Media Group would have broken even. "Media Group got off to a strong start in our first full year," said Richard McCormick, U S WEST chairman and chief executive officer. "We produced impressive cash flow growth. We set the stage for further growth by merging with Continental and introducing PCS. And last month we got a strong vote of confidence when investors bought $4.1 billion in U S WEST bonds." Chuck Lillis, Media Group president and chief executive officer, said he was particularly pleased that Media Group met -- and exceeded -- its aggressive objectives for 1996. "These results reflect our emphasis on superior operating performance," Lillis said. "Our cable subscriber growth in Atlanta was twice the industry average. Domestic cellular cash flow reached an all-time high. And directory revenue growth led that industry for the sixth straight year." In 1997, Lillis said Media Group will focus on two goals. "We're committed to again delivering industry-leading growth and continuing to upgrade our networks to offer new services," Lillis said. Proportionate operating highlights for 1996 -- by line of business -- include: - - - CABLE AND TELEPHONY: Subscriber growth of 4.5 percent for MediaOne, the company's Atlanta cable operation, exceeded the industry average for the eighth consecutive quarter. MediaOne ended 1996 with 512,000 customers. This strong subscriber growth produced revenue of $236 million, a 9.8 percent increase compared to 1995. Operating cash flow in 1996 was $109 million, a 9 percent increase. For the six weeks since it merged with Media Group, Continental reported domestic revenue of $263 million and operating cash flow of $87 million. Continental ended the year with 4.5 million domestic subscribers. Meanwhile, Media Group's investment in Time Warner Entertainment generated operating cash flow of $590 million in 1996, a 15.7 percent increase from 1995. Media Group's international cable properties also produced strong subscriber growth. At year-end, its share of subscribers in these joint ventures was 1.2 million, a 15 percent (normalized) increase compared to 1995. In the United Kingdom, the company's Telewest joint venture increased its cable subscriber base by 32 percent over 1995. Media Group ended 1996 with 161,000 U.K. cable subscribers. In addition, Telewest provided 47 percent more telephone lines in 1996, giving Media Group 207,000 lines. Nearly three-fourths of Telewest's cable subscribers also take telephone service. - WIRELESS: Media Group's domestic cellular operations continued to lead the industry in two growth measurements. Its subscriber base increased 40 percent, to 1.9 million proportionate customers, and its operating cash flow increased 50 percent, to $350 million. In addition, its operating cash flow margins increased by more than 4 percentage points. International wireless operations also grew rapidly. Media Group ended 1996 with 509,000 proportionate customers, up 65 percent from 1995. In the U.K., the company's One 2 One joint venture increased its subscriber base by 45 percent in 1996. Media Group ended the year with 273,000 proportionate customers. In Central Europe, Media Group's joint ventures in Hungary, the Czech Republic, Slovakia and Poland added more than 87,000 proportionate subscribers in 1996, largely due to the introduction of new digital wireless phones. - - - DIRECTORIES: Media Group's directory publishing business, now called U S WEST Dex, was an industry leader in published revenue growth for the sixth consecutive year. Boosted by a 5.7 percent increase in revenue per advertiser, Media Group's domestic directories reported 1996 revenue of $1.1 billion, a 7.4 percent increase from 1995. U S WEST Media Group, one of America's largest broadband communications companies, is involved in domestic and international cable and telephony, wireless communications, and directory and information services. For 1996, U S WEST Media Group reported proportionate revenues of $6.4 billion. Media Group is one of two major groups that make up U S WEST, a company in the connections business helping customers share information, entertainment and communications services in local markets worldwide. U S WEST's other major group, U S WEST Communications, provides telecommunications services in 14 western and midwestern states. # # # Some of the information presented in or in connection with this announcement constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes that its expectations are based on reasonable assumptions within the bounds of its knowledge of its business and operations, there can be no assurance that actual results will not differ materially from its expectations. Factors that could cause actual results to differ from expectations include: (i) a change in economic conditions in the various markets served by the Company's operations that could adversely affect the level of demand for cable, wireless, directory or other services offered by the Company, (ii) greater than anticipated competitive activity requiring new pricing for Company services, (iii) higher than anticipated start-up costs associated with new business opportunities, (iv) regulatory changes affecting the telecommunications industry, (v) increases in fraudulent activity with respect to wireless services, or (vi) delays in the development of anticipated technologies, or the failure of such technologies to perform according to expectations. Note: This release and the accompanying financial information will be available on the Internet after 8:00 a.m. MST, by accessing U S WEST's Internet site: www.uswest.com U S WEST MEDIA GROUP U S WEST MEDIA GROUP SELECTED OPERATING HIGHLIGHTS BY LINE OF BUSINESS (ALL CHANGES ARE IN COMPARISON TO YEAR-END 1995) U S WEST MEDIA GROUP COMBINED PROPORTIONATE RESULTS Revenue of $6.4 billion Operating cash flow of $1.47 billion CABLE AND TELEPHONY CONTINENTAL CABLEVISION (11/15/96-12/31/96) - - - A 3.8% cable subscriber increase on a comparable basis - - - Revenue of $263 million - - - Operating cash flow of $87 million INTERNATIONAL - - - 1.2 million subscribers, a 15% increase on a comparable basis - - - Revenue of $251 million, an 80% increase on a comparable basis - - - Operating cash flow loss of $50 million MEDIAONE - - - 512,000 customers, a 4.5% increase - - - Revenue of $236 million, a 9.8% increase - - - Operating cash flow of $109 million, a 9% increase TIME WARNER ENTERTAINMENT (TWE) - - - A 3.6% cable subscriber increase on a comparable basis - - - Revenue of $2.8 billion, a 14% increase - - - Operating cash flow of $590 million, a 15.7% increase WIRELESS DOMESTIC WIRELESS - - - 1.9 million customers, a 40% increase - - - Revenue of $1.1 billion, a 31% increase - - - Operating cash flow of $350 million, a 50% increase - - - Operating cash flow, as a percent of net operating revenue, of 37.5% INTERNATIONAL - - - 509,000 subscribers, a 65% increase - - - Revenue of $436 million, a 48% increase - - - Operating cash flow loss of $2 million, compared with a loss of $40 million in 1995 DIRECTORY AND INFORMATION SERVICES U S WEST DEX (DIRECTORIES) - - - Revenue of $1.1 billion, a 7.4% increase - - - Operating cash flow of $531 million, a 2.3% increase INTERNATIONAL - - - Revenue of $206 million, a 45% increase - - - Operating cash flow of $20 million, compared to $3 million in 1995 U S WEST MEDIA GROUP COMBINED GAAP RESULTS - - - Revenue of $2.96 billion - - - Operating cash flow of $937 million - - - Net loss of $71 million - - - Loss per common share of 16 cents EX-99 10 EXHIBIT 99B1 EXHIBIT 99B.1
COMBINED STATEMENTS OF OPERATIONS U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Year Ended December 31, % December 31, % In millions 1996 1995 Change 1996 1995 Change - - ------------------------------ ------- -------------- ------- ------- SALES AND OTHER REVENUES Directory $351 $324 8.3 $1,259 $1,180 6.7 Wireless 314 265 18.5 1,183 941 25.7 Cable 312 50 - 488 215 - Other 13 10 30.0 25 38 (34.2) ---------------- ---------------- Total revenues 990 649 52.5 2,955 2,374 24.5 ---------------- ---------------- EXPENSES Costs of sales and other revenues 340 233 45.9 966 772 25.1 Selling, general and administrative 354 252 40.5 1,052 886 18.7 Depreciation & amort 206 68 - 422 249 69.5 ---------------- ---------------- Total oper. expenses 900 553 62.7 2,440 1,907 27.9 ---------------- ---------------- Income from operations 90 96 (6.3) 515 467 10.3 Interest expense 88 11 - 168 100 68.0 Equity losses in unconsol ventures 122 79 54.4 346 207 67.1 Gain on merger of joint ven interest - 157 - - 157 - Guaranteed minority interest expense 19 12 58.3 55 14 - Other income (expense) - net 5 (19) - (19) 5 - ---------------- ---------------- Income (loss) before income taxes & extraordinary item (134) 132 - (73) 308 - Income tax (benefit) expense (53) 60 - (2) 163 - ---------------- ---------------- Income (loss) before extraordinary item (81) 72 - (71) 145 - Extraordinary item: Early extinguishment of debt, net of tax - - - - (4) - ---------------- ---------------- NET INCOME (LOSS) (81) 72 - (71) 141 - Preferred dividends 6 - - 9 3 - ---------------- ---------------- EARNINGS (LOSS) AVAILABLE FOR COMMON STOCK ($87) $72 - ($80) $138 - ================ ================
6
COMBINED STATEMENTS OF OPERATIONS U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Year Ended In millions, except December 31, % December 31, % per share amounts 1996 1995 Change 1996 1995 Change - - ------------------------------ ------- -------------- ------- ------- Average common shares outstanding (#1)(#2) 546.8 472.0 15.8 491.9 470.5 4.5 ================ ================ Earnings (loss) per common share: (#1) Income (loss) available for common stock before extraordinary item ($0.16) $0.15 - ($0.16) $0.30 - Extraordinary item - - - - (0.01) - ------- ------- ------- ------- Earnings (loss) per common share ($0.16) $0.15 - ($0.16) $0.29 - ================ ================ #1: Effective November 1, 1995, each share of U S WEST, Inc. common stock was converted into one share each of U S WEST Communications Group common stock and U S WEST Media Group common stock. Earnings per common share for 1995 have been presented on a pro forma basis to reflect the two classes of stock as if they were outstanding since January 1, 1995. For periods prior to the recapitalization, the average common shares outstanding are assumed to be equal to the average common shares outstanding for U S WEST, Inc. #2 The average common shares outstanding for the quarter and year ended December 31, 1996, includes 150.6 million shares related to the November 15, 1996, Continental Cablevision, Inc. merger.
7 EX-99 11 EXHIBIT 99B2 EXHIBIT 99B.2
SELECTED COMBINED GROUP DATA U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Year Ended Dollars in December 31, % December 31, % millions 1996 1995 Change 1996 1995 Change - - --------------------------------- ------- ------- ------- ------- REVENUES U S WEST Dex directories $290 $266 9.0 $1,102 $1,026 7.4 Other directories 61 58 5.2 157 154 1.9 Continental (#1) 252 - - 252 - - MediaOne 60 50 20.0 236 215 9.8 NewVector: Service 286 230 24.3 1,078 845 27.6 Equipment 28 35 (20.0) 105 96 9.4 -------------- ------------------ Total NewVector 314 265 18.5 1,183 941 25.7 Other 13 10 30.0 25 38 (34.2) -------------- ------------------ Total revenues $990 $649 52.5 $2,955 $2,374 24.5 EBITDA (#2) U S WEST Dex directories $149 $135 10.4 $531 $519 2.3 Other directories 3 (19) - (29) (85) 65.9 Continental (#1) 87 - - 87 - - MediaOne 26 26 - 109 100 9.0 NewVector 83 51 62.7 390 268 45.5 Other (52) (29) (79.3) (151) (86) (75.6) -------------- ------------------ Total EBITDA $296 $164 80.5 $937 $716 30.9 #1: Continental Cablevision, Inc. merged with U S WEST on November 15, 1996. # 2: Earnings before interest, taxes, depreciation, amortization and other (EBITDA). EBITDA also excludes equity losses and guaranteed minority interest expense. Note: Certain reclassifications have been made to conform to the current year presentation.
8 EX-99 12 EXHIBIT 99B2A EXHIBIT 99B.2 (cont'd.)
SELECTED COMBINED GROUP DATA U S WEST MEDIA GROUP (UNAUDITED) Dollars in millions; Quarter Ended Year Ended statistics in December 31, % December 31, % thousands 1996 1995 Change 1996 1995 Change - - ----------------- ------ ------ ------ ------ ------ ------ Other Data: U S WEST Dex directories (Yellow Pages) Net income $85 $82 3.7 $309 $307 0.7 Advertisers 482 479 0.6 482 479 0.6 Continental (#1) Basic sub- scribers(#2) 4,492 4,270 5.2 4,492 4,270 5.2 Homes passed 7,404 7,191 3.0 7,404 7,191 3.0 MediaOne (Atlanta Cable) Basic sub- scribers 512 490 4.5 512 490 4.5 Homes passed 890 848 5.0 890 848 5.0 U S WEST NewVector (Cellular) Subscribers (consol.) 2,043 1,463 39.6 2,043 1,463 39.6 Proportionate POPs managed (millions) 20.3 20.0 1.5 20.3 20.0 1.5 #1: Continental Cablevision, Inc. merged with U S WEST on November 15, 1996. The 1995 statistics are presented for comparative purposes only. #2: Includes Primestar subscribers
9 EX-99 13 EXHIBIT 99B3
COMBINED BALANCE SHEETS U S WEST MEDIA GROUP (UNAUDITED) December 31, In millions 1996 1995 - - --------------------------------------- -------------------------- ASSETS Current assets: Cash and cash equivalents $121 $20 Accounts and notes receivable 508 287 Deferred directory costs 259 247 Marketable securities 58 - Other assets 193 187 -------------------------- Total current assets 1,139 741 -------------------------- Property, plant and equipment - net 4,275 1,148 Investment in Time Warner Entertainment 2,477 2,483 Intangible assets - net 12,078 1,798 Investment in international ventures 1,882 1,511 Net investment in assets held for sale 409 429 Other assets 1,618 505 -------------------------- Total assets $23,878 $8,615 ========================== LIABILITIES AND EQUITY Current liabilities: Short-term debt $217 $836 Due to Continental shareholders 1,150 - Accounts payable 425 235 Deferred revenue and customer deposits 129 87 Other payables 795 411 -------------------------- Total current liabilities 2,716 1,569 -------------------------- Long-term debt 8,636 1,265 Deferred taxes 3,455 382 Deferred credits and other 346 276 Preferred securities of subsidiary trust holding Company-guaranteed debentures 1,080 600 Preferred stock subject to mandatory redemption 51 51 Media Group equity 7,685 4,599 Company LESOP guarantee (91) (127) -------------------------- Total equity 7,594 4,472 -------------------------- Total liabilities and equity $23,878 $8,615 ==========================
10 EX-99 14 EXHIBIT 99B4 EXHIBIT 99B.4
SELECTED PROPORTIONATE DATA (UNAUDITED) (1) U S WEST MEDIA GROUP Cable and Telecommunications Wireless Dollars in millions Domestic (2) Int'l Domestic Int'l - - ------------------- --------- ----- -------- ----- QTR Ended December 31, 1996 Revenues $1,099 $94 $288 $138 EBITDA 260 (14) 54 (3) Net income (loss) (75) (58) (1) (28) Subscribers/advertisers (thousands) 7,562 1,224 1,882 509 QTR Ended December 31, 1995 Revenues $753 $46 $238 $95 EBITDA 151 (21) 36 (15) Net income (loss) (16) 54 - (4) Subscribers/advertisers (thousands) 2,908 617 1,339 308 Year Ended December 31, 1996 Revenues $3,267 $251 $1,075 $436 EBITDA 776 (50) 307 (2) Net income (loss) (101) (215) 87 (98) Year Ended December 31, 1995 Revenues $2,643 $128 $818 $295 EBITDA 582 (55) 224 (40) Net income (loss) (55) 18 56 (80) (1) Proportionate data reflects the Media Group's relative ownership interest in revenues and EBITDA for both its consolidated and equity method entities. Proportionate data is not required by GAAP or intended to replace the Combined Financial Statements prepared in accordance with GAAP. (2) Includes the Media Group's 25.51 percent pro-rata priority and residual equity interests in reported TWE results.
11
SELECTED PROPORTIONATE DATA (UNAUDITED) (1) U S WEST MEDIA GROUP Directory & Corp Information Services & Dollars in millions Domestic Int'l Other Total - - ------------------- --------- ----- -------- ----- QTR Ended December 31, 1996 Revenues $294 $75 $3 $1,991 EBITDA 139 15 (36) 415 Net income (loss) 75 10 (4) (81) Subscribers/advertisers (thousands) 482 260 - 11,919 QTR Ended December 31, 1995 Revenues $274 $70 $4 $1,480 EBITDA 106 10 (3) 264 Net income (loss) 61 (2) (21) 72 Subscribers/advertisers (thousands) 479 271 - 5,922 Year Ended December 31, 1996 Revenues $1,120 $206 $12 $6,367 EBITDA 488 20 (66) 1,473 Net income (loss) 268 1 (13) (71) Year Ended December 31, 1995 Revenues $1,058 $142 $31 $5,115 EBITDA 424 3 11 1,149 Net income (loss) 247 (13) (32) 141 (1) Proportionate data reflects the Media Group's relative ownership interest in revenues and EBITDA for both its consolidated and equity method entities. Proportionate data is not required by GAAP or intended to replace the Combined Financial Statements prepared in accordance with GAAP.
12 EX-99 15 EXHIBIT 99C1 EXHIBIT 99C.1
CONSOLIDATED STATEMENTS OF U S WEST, Inc. INCOME (UNAUDITED) Quarter Ended Year Ended December 31, % December 31, % In millions 1996 1995 Change 1996 1995 Change - - ------------------------------ ------- ------ ------- ------- ------ SALES & OTHER REVENUES $3,558 $3,060 16.3 $12,911 $11,746 9.9 OPERATING EXPENSES Employee-related 1,166 1,089 7.1 4,412 4,071 8.4 Other operating 848 662 28.1 2,671 2,323 15.0 Taxes other than income taxes 110 86 27.9 429 416 3.1 Depreciation & amort 748 596 25.5 2,544 2,291 11.0 ---------------- -------- -------- Total operating expense 2,872 2,433 18.0 10,056 9,101 10.5 ---------------- -------- -------- Income from operations 686 627 9.4 2,855 2,645 7.9 Interest expense 201 123 63.4 612 527 16.1 Equity losses in unconsol ventures 122 79 54.4 346 207 67.1 Gain on merger of joint ven interest - 157 - - 157 - Gains on sales of rural telephone exchanges 8 24 (66.7) 59 136 (56.6) Guaranteed minority interest expense 19 12 58.3 55 14 - Other expense - net 14 30 (53.3) 61 36 69.4 ---------------- -------- -------- Income before inc taxes, extd item & cum effect of chg in acctg princ 338 564 (40.1) 1,840 2,154 (14.6) Income tax provision 108 208 (48.1) 696 825 (15.6) ---------------- -------- -------- Income before extd item, cum effect of chg in acctg princ 230 356 (35.4) 1,144 1,329 (13.9) Extraordinary item: Early extinguishment of debt - net of tax - (3) - - (12) - ---------------- -------- -------- Income before cum effect of chg in acctg princ 230 353 (34.8) 1,144 1,317 (13.1) Cumulative effect of change in accounting principle - net of tax - - - 34 - - ---------------- -------- -------- NET INCOME 230 353 (34.8) 1,178 1,317 (10.6) Preferred dividends 6 - - 9 3 - ---------------- -------- -------- EARNINGS AVAILABLE FOR COMMON STOCK $224 $353 (36.5) $1,169 $1,314 (11.0) ================ ======== ========
CONSOLIDATED STATEMENTS OF U S WEST, Inc. INCOME (UNAUDITED) Quarter Ended Year Ended In millions, except December 31, % December 31, % per share amounts 1996 1995 Change 1996 1995 Change - - ------------------------------ ------- ------ ------- ------- ------ COMMUNICATIONS GROUP: Average common shares outstanding (#1) 479.9 472.6 1.5 477.5 470.7 1.4 ================ ======== ======== Earnings per common share: (#1) Income before extraordi- nary item & cumulative effect of change in accounting principle $0.65 $0.60 8.3 $2.55 $2.52 1.2 Extraordinary item - (0.01) - - (0.02) - Cumulative effect of change in accounting principle - - - 0.07 - - ---------------- -------- -------- Earnings per common share $0.65 $0.59 10.2 $2.62 $2.50 4.8 ================ ======== ======== MEDIA GROUP: Average common shares outstanding (#1)(#2) 546.8 472.0 15.8 491.9 470.5 4.5 ================ ======== ======== Earnings (loss) per common share: (#1) Income (loss) available for common stock before extraordinary item ($0.16) $0.15 - ($0.16) $0.30 - Extraordinary item - - - - (0.01) - ---------------- -------- -------- Earnings (loss) per common share ($0.16) $0.15 - ($0.16) $0.29 - ================ ======== ======== #1 Effective November 1, 1995, each share of U S WEST, Inc. common stock was converted into one share each of U S WEST Communi- cations Group common stock and U S WEST Media Group common stock. Earnings per common share for 1995 have been presented on a pro forma basis to reflect the two classes of stock as if they were outstanding since January 1, 1995. For periods prior to the recapitalization, the average common shares outstanding are assumed to be equal to the average common shares outstanding for U S WEST, Inc. #2 The average common shares outstanding for the quarter and year ended December 31, 1996, includes 150.6 million shares related to the November 15, 1996, Continental Cablevision, Inc. merger.
CONSOLIDATED STATEMENTS OF U S WEST, Inc. INCOME (UNAUDITED) Quarter Ended Year Ended December 31, % December 31, % Dollars in millions 1996 1995 Change 1996 1995 Change - - ------------------------------ ------- ------ ------- ------- ------ SELECTED CONSOLIDATED DATA Capital expenditures $1,137 $957 18.8 $3,474 $3,140 10.6 Debt-to-capital ratio (#1) 54.8% 50.7% - 54.8% 50.7% - Employees 69,286 61,047 13.5 69,286 61,047 13.5 EBITDA $1,434 $1,223 17.3 $5,399 $4,936 9.4 EBITDA margin 40.3% 40.0% - 41.8% 42.0% - #1 Ratio includes preferred securities and other preferred stock as a component of total capital. Including debt related to the net investment in assets held for sale, preferred securities and other preferred stock, the Company's percentage of debt to total capital was 59.6% and 56.4% at December 31, 1996 and 1995, respectively.
EX-99 16 EXHIBIT 99C2 EXHIBIT C.2
CONSOLIDATED BALANCE SHEETS U S WEST, Inc. (UNAUDITED) December 31, In millions 1996 1995 - - --------------------------------------- ------------------------- ASSETS Current assets: Cash and cash equivalents $201 $192 Accounts and notes receivable 2,113 1,886 Inventories and supplies 159 227 Deferred tax asset 140 282 Marketable securities 58 - Prepaid and other 367 322 ------------------------- Total current assets 3,038 2,909 ------------------------- Property, plant and equipment - net 18,281 14,677 Investment in Time Warner Entertainment 2,477 2,483 Intangible assets - net 12,078 1,798 Investment in international ventures 1,882 1,511 Net investment in assets held for sale 409 429 Other assets 2,433 1,264 ------------------------- Total assets $40,598 $25,071 ========================= LIABILITIES AND SHAREOWNERS' EQUITY Current liabilities: Short-term debt $1,051 $1,901 Accounts payable 1,316 975 Due to Continental shareholders 1,150 - Dividends payable 263 254 Other payables 2,294 1,922 ------------------------- Total current liabilities 6,074 5,052 ------------------------- Long-term debt 14,300 6,954 Deferred taxes 4,304 1,270 Postretirement and other postemployment benefit obligations 2,479 2,433 Deferred credits and other 799 763 Preferred securities of subsidiary trust holding Company-guaranteed debentures 1,080 600 Preferred stock subject to mandatory redemption 51 51 Shareowners' equity: Preferred shares 920 - Common shares 10,741 8,228 Retained deficit (30) (115) LESOP guarantee (91) (127) Foreign currency translation adjustments (29) (38) ------------------------- Total shareowners' equity 11,511 7,948 ------------------------- Total liabilities & shareowners' equity $40,598 $25,071 =========================
EX-99 17 EXHIBIT 99C3 EXHIBIT 99C.3
CONSOLIDATED STATEMENTS OF U S WEST, Inc. CASH FLOWS (UNAUDITED) Year Ended December 31, In millions 1996 1995 - - --------------------------------------------------------------------- OPERATING ACTIVITIES Net income $1,178 $1,317 Adjustments to net income: Depreciation and amortization 2,544 2,291 Equity losses in unconsolidated ventures 346 207 Gain on merger of joint venture interest - (157) Gains on sales of rural telephone exchanges (59) (136) Cumulative effect of change in accounting principle (34) - Deferred income taxes and amortization of investment tax credits 5 274 Changes in operating assets and liabilities: Restructuring payments (242) (334) Postretirement medical and life costs, net of cash fundings 39 (24) Accounts and notes receivable (56) (169) Inventories, supplies and other 31 (79) Accounts payable and accrued liabilities 225 45 Other - net 21 185 - - --------------------------------------------------------------------- Cash provided by operating activities 3,998 3,420 - - --------------------------------------------------------------------- INVESTING ACTIVITIES Expenditures for property, plant and equipment (3,071) (2,825) Investment in international ventures (243) (681) Proceeds from disposals of property, plant and equipment 189 201 Cash from net investment in assets held for sale 213 - Other - net (136) (201) - - --------------------------------------------------------------------- Cash (used for) investing activities (3,048) (3,506) - - --------------------------------------------------------------------- FINANCING ACTIVITIES Net proceeds from (repayments of) issuance of short-term debt 3,987 (1,281) Proceeds from issuance of long-term debt 383 2,732 Repayments of long-term debt (4,699) (1,058) Proceeds from issuance of trust originated preferred securities - net 465 581 Dividends paid on common and preferred stock (948) (929) Proceeds from issuance of common stock 168 87 Purchases of treasury stock (297) (63) - - --------------------------------------------------------------------- Cash (used for) provided by financing activities (941) 69 - - --------------------------------------------------------------------- CASH AND CASH EQUIVALENTS Increase (decrease) 9 (17) Beginning balance 192 209 - - --------------------------------------------------------------------- Ending balance $201 $192 =====================================================================
EX-27 18 FDS
5 0000732718 U S WEST, INC. 1,000,000 3-MOS 12-MOS DEC-31-1996 DEC-31-1996 DEC-31-1996 DEC-31-1996 201 201 58 58 2,113 2,113 0 0 159 159 3,038 3,038 37,756 37,756 19,475 19,475 40,598 40,598 6,074 6,074 14,300 14,300 1,131 1,131 920 920 10,741 10,741 (150) (150) 40,598 40,598 3,558 12,911 3,558 12,911 0 0 0 0 2,872 10,056 0 0 201 612 338 1,840 108 696 230 1,444 0 0 0 0 0 34 230 1,178 .65 2.62 .65 2.62
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