-----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, C/Ylr31DDCHNFC+bsgkve4p0pMV/agov0SrbH6r85C/7QV5ZbPygDcRRl3/o3dMQ saTN5k+Y8fdSwE7FP+fjYA== 0000732718-97-000021.txt : 19970807 0000732718-97-000021.hdr.sgml : 19970807 ACCESSION NUMBER: 0000732718-97-000021 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 20 CONFORMED PERIOD OF REPORT: 19970630 ITEM INFORMATION: Other events FILED AS OF DATE: 19970730 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: 97648459 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 4 8K797.DOC 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): July 25, 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 July 25, 1997, U S WEST Communications Group released its second quarter earnings results. In addition, U S WEST Media Group released its second quarter earnings results on July 29, 1997. The releases and financial statements are attached hereto as Exhibits. Item 7. Exhibits Exhibit Description 27 Financial Data Schedule. 99A Press Release issued July 25, 1997 concerning the earnings results of U S WEST Communications Group for the second quarter of 1997. 99A.1 Unaudited Combined Statements of Operations of U S WEST Communications Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 25, 1997. 99A.2 Unaudited Selected Combined Group Data of U S WEST Communications Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 25, 1997. 99A.3 Unaudited Combined Balance Sheets of U S WEST Communications Group for the quarter ended June 30, 1997 and the year ended December 31, 1996, filed in connection with the Press Release dated July 25, 1997. 99A.4 Unaudited Combined Statements of Cash Flows of U S WEST Communications Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 25, 1997. 99A.5 Unaudited Statements of Operations of U S WEST Communications Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 25, 1997. 99A.6 Unaudited Earnings Normalization Schedule of U S WEST Communications, Inc. for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 25, 1997. 99B Press Release issued July 29, 1997 concerning the earnings results of U S WEST Media Group for the second quarter of 1997. 99B.1 Unaudited Selected Proportionate Financial Data of U S WEST Media Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 29, 1997. 99B.2 Unaudited Other Proportionate Information of U S WEST Media Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 29, 1997. 99B.3 Unaudited Selected Financial and Operating Highlights of U S WEST Media Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 29, 1997. 99B.4 Unaudited Pro Forma Combined Statements of Operations of U S WEST Media Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 29, 1997. 99B.5 Unaudited Selected Financial Data of U S WEST Media Group for the quarters ended June 30, 1996 and 1997, filed in connection with the Press Release dated July 29, 1997. 99B.6 Unaudited Combined Balance Sheets of U S WEST Media Group for the quarter ended June 30, 1997 and the year ended December 31, 1996, filed in connection with the Press Release dated July 29, 1997. 99B.7 Investing Activity of U S WEST Media Group for the quarters ended June 30, and March 31, 1997, filed in connection with the Press Release dated July 29, 1997. 99C.1 Unaudited Consolidated Statements of Income of U S WEST, Inc. for the quarter periods ended June 30, 1996 and 1997. 99C.2 Unaudited Consolidated Balance Sheets of U S WEST, Inc. for the quarter ended June 30, 1997 and the year ended December 31, 1996. 99C.3 Unaudited Consolidated Statements of Cash Flows of U S WEST, Inc. for the quarters ended June 30, 1996 and 1997. 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: July 30, 1997 EX-99 2 EX-99 A EXHIBIT 99A U S WEST Communications, Inc. 1801 California Street Denver, Colorado 80202 [U S WEST Communications, Inc. logo and registered mark] News Release Release Date: July 25, 1997 Contact: Dave Banks, 303/896-3040 U S WEST COMMUNICATIONS REPORTS EARNINGS PER SHARE GAIN OF 6.6 PERCENT - PENDING REGULATORY ITEMS IMPACT REVENUES; COST CONTROLS CONTINUE - ENGLEWOOD, Colo. -- U S WEST Communications Group (NYSE: USW) today reported another quarter of strong earnings growth. Results were driven by a strong balance of revenue production and aggressive cost reductions. The company achieved this while launching new marketing initiatives; absorbing costs related to growth; and expending almost $85 million year-to-date for mandated interconnection to help foster local competition. Normalized net income for the quarter increased 8.7 percent to $314 million from $289 million in second quarter 1996. Normalized earnings per share grew to $0.65 for the quarter, up 6.6 percent from the $0.61 reported in second quarter 1996. Results for the quarter were normalized for an $18 million one-time, after-tax gain associated with the sale of selected rural exchanges in Idaho, Iowa and South Dakota. Results for second quarter, 1996 were normalized to reflect the effects of a change in accounting principle and to reflect a $30 million one-time, after-tax gain associated with the sale of selected rural exchanges in the Dakotas. "Investors and customers should be pleased with what the people of U S WEST Communications have accomplished," said Richard McCormick, chairman and chief executive officer of U S WEST, Inc. "They're meeting their financial commitments to investors, while dramatically improving service levels, gearing up for new growth initiatives, and meeting federal and state mandates related to introducing competition in their local markets." "We had a very solid quarter, primarily because our expense controls have started to gain traction," said Sol Trujillo, president and chief executive officer of U S WEST Communications Group. "This is our fourth consecutive quarter of moderating expense growth, and we believe the run-rate impact of what we've put into place in our core operations is sustainable." -more- Page 2 Trujillo said quarterly results were diluted by pending regulatory items and also by the beginning of some significant spending relative to interconnection. Although revenues are slightly below plan, Trujillo said they are still showing strong core growth, and he expects improvement in the second half with a number of marketing initiatives now in place or set to roll out. Revenues have also been impacted by intraLATA toll losses. Second quarter highlights include: Volumes and Penetration: - - -The addition of 686,000 access lines (adjusted for the sale of selected rural exchanges) over the past twelve months for an access line growth rate of 4.6 percent. On an adjusted basis, business access lines grew at 6.8 percent; residential access lines grew at 3.6 percent; and residential additional lines grew at nearly 27 percent, reaching a second-line penetration level of 12.2 percent. - - -Residential penetration levels for the company's most popular custom calling features reached all-time highs: Caller ID, 27.7 percent; Voice Messaging, 17.5 percent; and Call Waiting, 38.9 percent. A highly successful first quarter Caller ID campaign contributed approximately $4 million in recurring monthly revenues during the second quarter. - - -The successful launch of National Directory Assistance in Colorado and New Mexico. National DA allows customers to obtain phone numbers anywhere in the U. S. simply by calling 1-411. In the first two months of deployment, the product generated 250 percent of expected call volume. It has taken almost 20 percent of the share of National directory assistance calls originating in those markets, and will roll out in the remainder of the territory in 3rd and 4th quarter. - - -An increase of 9.5 percent in customer order volumes year-to-date versus the first half of 1996, including orders for new services, transfers, and changes. - - -The company has sold more than 165,000 Home Receptionist and Business Receptionist Screen Phones, making it the industry leader in that product. These phones visually and functionally integrate a number of custom calling services, and increase the penetration of these vertical services. Sales and Revenues: - - -Adjusting for a number of items, local service revenue growth was 6.4 percent, with almost half the growth driven by the sales of vertical services. Total revenue growth, adjusted for these same items, was 4.6 percent. -more- Page 3 -A 19 percent increase in private line and special access revenues, which totaled over $200 million for the second quarter -- a reflection of the company's growing data networking services business and its ability to successfully compete in one of the most highly competitive segments of the telecommunications market. - - -Total new product and services revenues are up more than 35 percent from second quarter 1996 to over $280 million. Those revenues now represent 11 percent of total revenues. Growth Initiatives: - - -Final regulatory approval of the company's wireless PCS licenses to cover nearly 20 million POPs throughout the region. The company plans to deploy services in Denver in the Fall and at least one other market by the end of the year. - - -Rollout of the U S WEST Express Calling Card throughout the company's region. Through a special partnering arrangement with Frontier Communications, this 1-800 calling card allows customers to make both interLATA and intraLATA calls cost effectively nationwide. More than 2.9 million cards have been distributed to date. - - -Data networking services revenues of more than $75 million in the quarter -- up 48 percent from the same period in 1996. Costs and Margins: - - -Absorbed approximately $40 million year-to-date in expenses and approximately $45 million year-to-date in capital related to interconnection. The company expects to significantly increase its spending on interconnection for the balance of 1997. U S WEST Communications now has 250 agreements throughout its 14-state region with competitive local exchange carriers. - - -The fourth consecutive quarter in which both employee related and total operating expense growth have slowed. - - -Employee year-over-year reductions, coupled with strong access line growth, have driven telco employees per 10,000 access lines down 11.3 percent to 28.4. - - -Growth in cash provided by operating activities of 40 percent, or almost $573 million, and even stronger growth in net cash flow, enabled the company to reduce its borrowing levels by over $710 million during the first half of 1997. -more- Page 4 Trujillo added that the company is on plan with its 1997 earnings and operational objectives. He reiterated that as the year progresses, costs associated with starting up new businesses and complying with the Telecommunications Act of 1996 will accelerate, dampening earnings growth in later quarters. U S WEST Communications (NYSE: USW) provides telecommunications and data networking 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, 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 Media Group, is involved in domestic and international cable and telephony, wireless communications, and directory and information 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 or 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 FINANCIAL STATEMENTS WILL BE AVAILABLE ON THE INTERNET AFTER 8:00 A.M. (MDT) BY ACCESSING U S WEST'S INTERNET SITE: WWW.USWEST.COM EX-99 3 EX-99A1
EXHIBIT 99A.1 COMBINED STATEMENTS OF OPERATIONS U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Six Months Ended June 30, Percent June 30, Percent In millions 1997 1996 Change 1997 1996 Change - - ------------------------------- ------- ------------- ------- ------- OPERATING REVENUES Local service $ 1,151 $ 1,179 (2.4)$ 2,382 $ 2,324 2.5 Interstate access 678 626 8.3 1,365 1,248 9.4 Intrastate access 200 189 5.8 400 379 5.5 Long-distance network 240 278 (13.7) 490 568 (13.7) Other services 274 228 20.2 493 446 10.5 ---------------- ---------------- Total operating revenues 2,543 2,500 1.7 5,130 4,965 3.3 ---------------- ---------------- OPERATING EXPENSES Employee-related 904 921 (1.8) 1,768 1,788 (1.1) Other operating 391 387 1.0 836 775 7.9 Taxes other than income taxes 98 100 (2.0) 205 197 4.1 Depreciation & amort. 530 518 2.3 1,057 1,035 2.1 ---------------- ---------------- Total operating expenses 1,923 1,926 (0.2) 3,866 3,795 1.9 ---------------- ---------------- Income from operations 620 574 8.0 1,264 1,170 8.0 Interest expense 100 110 (9.1) 203 221 (8.1) Gains on sales of rural telephone exchanges 29 49 (40.8) 47 49 (4.1) Other income (expense) - net (19) 4 - (41) (12) - ---------------- ---------------- Income before income taxes & cumulative effect of change in accounting princple 530 517 2.5 1,067 986 8.2 Income tax provision 198 193 2.6 396 368 7.6 ---------------- ---------------- Income before cumulative effect of change in accounting principle 332 324 2.5 671 618 8.6 Cumulative effect of change in accounting principle - net of tax - - - - 34 - ---------------- ---------------- NET INCOME $ 332 $ 324 2.5 $ 671 $ 652 2.9 ================ ================
COMBINED STATEMENTS OF OPERATIONS U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Six Months Ended In millions, except June 30, Percent June 30, Percent per share amounts 1997 1996 Change 1997 1996 Change - - ------------------------------- ------- ------------- ------- ------- Average common shares outstanding 482.5 476.8 1.2 481.9 475.9 1.3 ================ ================ Earnings per common share: Income before cumulative effect of change in accounting principle $ 0.69 $ 0.68 1.5 $ 1.39 $ 1.30 6.9 Cumulative effect of change in accounting principle - - - - 0.07 - ---------------- ---------------- Earnings per common share $ 0.69 $ 0.68 1.5 $ 1.39 $ 1.37 1.5 ================ ================
EX-99 4 EX-99A2
EXHIBIT 99A.2 SELECTED COMBINED GROUP DATA U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Six Months Ended In millions, except June 30, % June 30, % per share amounts 1997 1996 Change 1997 1996 Change - - -------------------------------- ------- ------------- ------- ------- Normalized access lines (thousands): Business 4,692 4,394 6.8 4,692 4,394 6.8 Consumer 11,062 10,674 3.6 11,062 10,674 3.6 Total 15,754 15,068 4.6 15,754 15,068 4.6 Access lines (thousands): Business 4,678 4,394 6.5 4,678 4,394 6.5 Consumer 11,006 10,674 3.1 11,006 10,674 3.1 Total access lines 15,684 15,068 4.1 15,684 15,068 4.1 Billed access minutes of use (millions): Interstate 13,795 13,002 6.1 27,325 25,698 6.3 Intrastate 2,957 2,629 12.5 5,742 5,196 10.5 Total minutes of use 16,752 15,631 7.2 33,067 30,894 7.0 Employees: Communications Group 47,090 51,141 (7.9) 47,090 51,141 (7.9) Telephone operations only 44,469 48,264 (7.9) 44,469 48,264 (7.9) Telephone employees per 10,000 access lines 28.4 32.0 (11.3) 28.4 32.0 (11.3) Dividends per common share $0.535 $0.535 - $1.07 $1.07 - Common shares outstanding 483.0 477.4 1.2 483.0 477.4 1.2 Capital expenditures $ 516 $ 635 (18.7) $ 924 $1,346 (31.4) EBITDA (1) 1,150 1,092 5.3 2,321 2,205 5.3 EBITDA margin 45.2% 43.7% - 45.2% 44.4% - Return on equity (2) 31.6% 34.6% - 32.4% 33.6% - Debt-to-capital ratio: Communications Grp 58.2% 62.4%# - 58.2% 62.4%# - Telephone operations only 56.2% 60.5%# - 56.2% 60.5%# - As of December 31, 1996. 1: Earnings before interest, taxes, depreciation, amortization, and other (EBITDA). EBITDA also excludes gains on asset sales. 2: Based on income before cumulative effect of change in accounting principle.
EX-99 5 EX-99A3
EXHIBIT 99A.3 COMBINED BALANCE SHEETS U S WEST COMMUNICATIONS GROUP (UNAUDITED) June 30, December 31, In millions 1997 1996 - - -------------------------------------- --------------------------- ASSETS Current assets: Cash and cash equivalents $ 89 $ 80 Accounts and notes receivable 1,605 1,622 Inventories and supplies 182 144 Deferred tax asset 197 171 Prepaid and other 73 65 --------------------------- Total current assets 2,146 2,082 --------------------------- Gross property, plant and equipment 32,787 32,645 Less accumulated depreciation 19,082 18,639 --------------------------- Property, plant and equipment - net 13,705 14,006 Other assets 910 827 --------------------------- Total assets $ 16,761 $ 16,915 =========================== LIABILITIES AND EQUITY Current liabilities: Short-term debt $ 166 $ 834 Accounts payable 1,029 989 Dividends payable 258 257 Other 1,670 1,387 --------------------------- Total current liabilities 3,123 3,467 --------------------------- Long-term debt 5,619 5,664 Postretirement and other postemployment benefit obligations 2,393 2,387 Deferred taxes, credits and other 1,476 1,480 Communications Group equity 4,150 3,917 --------------------------- Total liabilities and equity $ 16,761 $ 16,915 ===========================
EX-99 6 EX-99A4
EXHIBIT 99A.4 COMBINED STATEMENTS OF U S WEST COMMUNICATIONS GROUP CASH FLOWS (UNAUDITED) Six Months Ended June 30, In millions 1997 1996 - - --------------------------------------------------------------------- OPERATING ACTIVITIES Net income $ 671 $ 652 Adjustments to net income: Depreciation and amortization 1,057 1,035 Gains on sales of rural telephone exchanges (47) (49) Cumulative effect of change in accounting principle - (34) Deferred income taxes and amortization of investment tax credits (17) (3) Changes in operating assets and liabilities: Restructuring payments (45) (74) Postretirement medical and life costs, net of cash fundings 3 (30) Accounts receivable 17 57 Inventories, supplies and other (58) (35) Accounts payable and accrued liabilities 336 (62) Other - net 85 (28) - - --------------------------------------------------------------------- Cash provided by operating activities 2,002 1,429 - - --------------------------------------------------------------------- INVESTING ACTIVITIES Expenditures for property, plant and equipment (841) (1,266) Proceeds from sales of rural telephone exchanges 28 111 Proceeds from (payments on) disposals of property, plant, and equipment 4 (7) - - --------------------------------------------------------------------- Cash (used for) investing activities (809) (1,162) - - --------------------------------------------------------------------- FINANCING ACTIVITIES Proceeds from (repayments on) issuance of short-term debt (662) 260 Repayments of long-term debt (85) (253) Dividends paid on common stock (475) (467) Proceeds from issuance of common stock 38 76 - - --------------------------------------------------------------------- Cash (used for) financing activities (1,184) (384) - - --------------------------------------------------------------------- CASH AND CASH EQUIVALENTS Increase (decrease) 9 (117) Beginning balance 80 172 - - --------------------------------------------------------------------- Ending balance $ 89 $ 55 =====================================================================
10 EX-99 7 EX-99A5
EXHIBIT 99A.5 STATEMENTS OF OPERATIONS U S WEST COMMUNICATIONS, Inc. (UNAUDITED) (Telephone Operations Only) Quarter Ended Six Months Ended June 30, % June 30, % In millions 1997 1996 Change 1997 1996 Change - - ------------------------------- ------- ------------- ------- ------- OPERATING REVENUES Local service $ 1,151 $ 1,179 (2.4)$ 2,382 $ 2,324 2.5 Interstate access 678 626 8.3 1,365 1,248 9.4 Intrastate access 200 189 5.8 400 379 5.5 Long-distance network 240 278 (13.7) 490 568 (13.7) Other services 219 168 30.4 398 329 21.0 ---------------- ---------------- Total operating revenues 2,488 2,440 2.0 5,035 4,848 3.9 ---------------- ---------------- OPERATING EXPENSES Employee-related 842 864 (2.5) 1,648 1,677 (1.7) Other operating 374 373 0.3 824 762 8.1 Taxes other than income taxes 95 97 (2.1) 200 192 4.2 Depreciation & amort 524 513 2.1 1,046 1,024 2.1 ---------------- ---------------- Total operating expenses 1,835 1,847 (0.6) 3,718 3,655 1.7 ---------------- ---------------- Income from operations 653 593 10.1 1,317 1,193 10.4 Interest expense 93 101 (7.9) 189 204 (7.4) Gains on sales of rural telephone exchanges 29 49 (40.8) 47 49 (4.1) Other income (expense) - net (18) 2 - (40) (15) - ---------------- ---------------- Income before income taxes & cumulative effect of change in accounting principle 571 543 5.2 1,135 1,023 10.9 Income tax provision 218 208 4.8 433 391 10.7 ---------------- ---------------- Income before cumulative effect of change in accounting principle 353 335 5.4 702 632 11.1 Cumulative effect of change in accounting principle - net of tax - - - - 34 - ---------------- ---------------- NET INCOME $ 353 $ 335 5.4 $ 702 $ 666 5.4 ================ ================
EX-99 8 EX99A6
EXHIBIT 99A.6 EARNINGS NORMALIZATION SCHEDULE U S WEST COMMUNICATIONS GROUP (UNAUDITED) Quarter Ended Six Months Ended In millions, except June 30, % June 30, % per share amounts 1997 1996 Change 1997 1996 Change - - ------------------------------- ------- ------------- ------- ------- NORMALIZED INCOME: Reported net income $ 332 $ 324 2.5 $ 671 $ 652 2.9 Adjustments to normalize net income: Rural exchange sales (18) (30)(40.0) (29) (30) (3.3) Cumulative effect of change in accounting principle-net of tax - - - - (34) - Current year effect of accounting change - net of tax - (5) - - (10) - ---------------- ---------------- Normalized income $ 314 $ 289 8.7 $ 642 $ 578 11.1 ================ ================ NORMALIZED EARNINGS PER COMMON SHARE: Reported net income $ 0.69 $ 0.68 1.5 $ 1.39 $ 1.37 1.5 Adjustments to normalize net income: Rural exchange sales (0.04) (0.06)(33.3) (0.06) (0.06) - Cumulative effect of change in accounting principle-net of tax - - - - (0.07) - Current year effect of accounting change - net of tax - (0.01) - - (0.02) - ---------------- ---------------- Normalized earnings per common share $ 0.65 $ 0.61 6.6 $ 1.33 $ 1.22 9.0 ================ ================
EX-99 9 EX99B EXHIBIT 99B U S WEST Media Group 7800 East Orchard Road Englewood, Colorado 80111 [U S WEST Media Group logo and registered mark] News Release Release Date: July 29, 1997 Contact: Blair Johnson Steve Lang (303) 793-6296 (303) 793-6290 U S WEST MEDIA GROUP REPORTS SEVENTH CONSECUTIVE QUARTER OF DOUBLE-DIGIT REVENUE AND CASH-FLOW GROWTH ENGLEWOOD, Colo. - U S WEST Media Group (NYSE: UMG) today reported its seventh straight quarter of double-digit growth in revenue and operating cash flow. For the second quarter 1997, Media Group reported - on a proportionate basis: - - -A 16 PERCENT INCREASE IN OPERATING CASH FLOW, to $657 million. Media Group's operating cash flow for second quarter 1996 was $566 million on a comparable basis. (All 1996 numbers have been adjusted to include Continental Cablevision's results - even though it didn't merge with Media Group until Nov. 15, 1996.). Operating cash flow, which represents earnings before interest, taxes, depreciation and amortization (EBITDA), is a key indicator of the company's operating performance. - - -A 15 PERCENT INCREASE IN REVENUE, to $2.3 billion. Media Group's revenue for second quarter 1996 was $2.0 billion. 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. "This was another strong quarter - financially and operationally," said Richard McCormick, U S WEST chairman and chief executive officer. "This marks the first time our international operations -- including all three lines of business -- were cash-flow positive. That's an encouraging development as Media Group strives to reach its goal of 20 percent annual cash-flow growth." Chuck Lillis, Media Group president and chief executive officer, said, "Besides delivering strong cash flow, we renamed all our domestic cable systems MediaOne -- a name that reflects how we're using a single network to deliver new broadband services. - - -more- Page 2 "In the second quarter, we expanded one of those products -- our high-speed data service, MediaOne Express -- into two new markets," Lillis said. "We began the quarter with 3,500 data customers and ended it with more than 6,400. And two weeks ago, we introduced MediaOne Express in a sixth market - Atlanta." MediaOne Express is also available in parts of greater Boston; Jacksonville, Fla.; Detroit; Chicago; and southeast Florida. By the end of the year, MediaOne expects to offer it in three more markets. Lillis also said the company is making good progress toward its goal of generating $1 billion by selling non-strategic assets. This year Media Group has sold more than $625 million in non-strategic assets, including its wireless interest in France, and a directory publishing company in the United Kingdom. In addition, the company sold non-strategic programming and cable interests, as well as shares in Teleport Communications Group and Time Warner that Media Group acquired in its merger with Continental. "Streamlining our business sharpens our focus in many ways, including providing additional cash to fund our network upgrades," Lillis said. "These upgrades are enabling us to go beyond cable TV to offer multichannel video, high-speed data and telephone services." Second quarter 1997 proportionate operating highlights - by line of business - include: - - -CABLE AND BROADBAND COMMUNICATIONS: MediaOne ended the second quarter with almost 5.1 million subscribers, up 3.4 percent from the second quarter 1996. Overall, revenue from Media Group's domestic cable operations, including its investment in Time Warner Entertainment, increased 6.9 percent, to nearly $1.3 billion, while operating cash flow was up 5.8 percent, to $402 million. -WIRELESS: Media Group's domestic cellular operations continued to deliver strong results. Its subscriber base increased 33 percent, to 2.1 million proportionate customers, and its operating cash flow increased 54 percent, to $132 million. In addition, its operating cash flow margins increased by 8.6 percentage points. Internationally, Media Group's wireless business continued to grow rapidly, more than doubling its subscriber base since the second quarter of 1996. Much of that growth came from One 2 One, the company's joint venture in the United Kingdom. With aggressive marketing and expanded coverage now reaching 85 percent of the U.K. population, One 2 One increased its second quarter 1997 subscriber base by 59 percent from the same period last year. One 2 One also improved its revenue per customer by more than 10 percent. -more- Page 3 - - -DIRECTORIES: Media Group's directory publishing business, now called U S WEST Dex, produced strong second quarter revenue growth of 6.6 percent, helping the company remain an industry leader. In addition, Dex increased its revenue per customer by 7.4 percent in the second quarter. Media Group's second quarter 1997 net loss was $94 million. 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, Media Group had proportionate pro forma revenue of $8.1 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 FINANCIAL STATEMENTS WILL BE AVAILABLE ON THE INTERNET AFTER 8:00 A.M. (MDT) BY ACCESSING U S WEST'S INTERNET SITE: WWW.USWEST.COM U S WEST Media Group Page 4 U S WEST MEDIA GROUP - SELECTED OPERATING HIGHLIGHTS ALL AMOUNTS SHOWN ARE PROPORTIONATE UNLESS OTHERWISE STATED $ IN MILLIONS CABLE AND BROADBAND COMMUNICATIONS
DOMESTIC 2Q97 GROWTH* ------ -------- TOTAL Revenue $2,281 6.9% EBITDA $402 5.8%
CONSOLIDATED CABLE (EXCLUDING NEW SERVICES)
Homes Passed (000's) 8,395 2.4% Multichannel Video Subscribers (000's) 5,095 3.4 Revenue $580 9.2% EBITDA $258 8.4% High Speed Data Customers (000's) 6.4 -
INTERNATIONAL 2Q97 GROWTH* ------ -------- TOTAL Customers (000's) 1,199 12.0% Revenue $118 42.2% EBITDA $11 up $14
WIRELESS DOMESTIC 2Q97 GROWTH ------- ------- CELLULAR POPs (millions) 20.3 1.5% Subscribers (000's) 2,073 33.1% Service Revenue $296 23.8% Operating Cash Flow $132 53.5% OCF as a percent of service revenue 44.5% 8.6 pp Average revenue per $48.98 -8.9% customer
PRIMECO PERSONAL COMMUNICATIONS
POPs (millions) 14.7 7.3% Subscribers (000's) 46 -
INTERNATIONAL 2Q97 GROWTH ----- ------- TOTAL Customers (000's) 760 105.4% Revenue $180 81.8% Operating Cash Flow $7 up $8
ONE 2 ONE Subscribers (000's) 351 59.0% Market Share 9.5% Coverage 85%
DIRECTORY AND INFORMATION SERVICES
DOMESTIC 2Q97 GROWTH ------- ------- DIRECTORY PUBLISHING Local Advertisers (000's) 482 - Revenue $291 6.6% Operating Cash Flow $149 9.6% Operating Cash Flow 51.2% 1.4 pp Margin Revenue per Advertiser $2,254 7.4%
INTERNATIONAL 2Q97 GROWTH ----- ------- TOTAL Revenue $47 4.4% Operating Cash Flow $8 100.0%
* Growth rates are pro forma as if the Continental merger occurred January 1, 1996. EX-99 10 EX-99B1
EXHIBIT 99B.1 SELECTED PROPORTIONATE U S WEST MEDIA GROUP FINANCIAL DATA (UNAUDITED) Quarter Ended Six Months Ended June 30, June 30, 1996 % 1996 % In millions 1997 Pro formaChange 1997 Pro formaChange - - ----------------------------------------------------------------- Revenues Cable & telecomm. Domestic $1,281 $1,198 6.9 $2,496 $2,351 6.2 Int'l 118 83 42.2 226 165 37.0 Wireless Domestic 343 261 31.4 652 501 30.1 Int'l 180 99 81.8 324 187 73.3 Directory & info. svcs. Domestic 297 279 6.5 584 550 6.2 Int'l 47 45 4.4 76 77 (1.3) Corp. & Other 2 3 (33.3) 7 6 16.7 -------- -------- -------- -------- Total $2,268 $1,968 15.2 $4,365 $3,837 13.8 ======== ======== ======== ======== EBITDA Cable & telecomm. Domestic $ 402 $ 380 5.8 $ 792 $ 741 6.9 Int'l 11 (3) - 20 (5) - Wireless Domestic 111 78 42.3 212 147 44.2 Int'l 7 (1) - (3) - - Directory & info. svcs. Domestic 138 124 11.3 277 241 14.9 Int'l 8 4 - 2 - - Corp. & Other (20) (16) (25.0) (23) (25) 8.0 -------- -------- -------- -------- Total $ 657 $ 566 16.1 $1,277 $1,099 16.2 ======== ======== ======== ========
The 1996 amounts are pro forma as if the Continental Cablevision merger occurred January 1, 1996.
OTHER PROPORTIONATE INFORMATION U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Six Months Ended June 30, June 30, 1996 % 1996 % In millions 1997 Pro forma Change 1997 Pro forma Change - - ----------------------------------------------------------------- Depr. & Amort. Cable & telecomm. Domestic $ 333 $ 324 2.8 $ 673 $ 644 4.5 Int'l 50 35 42.9 98 61 60.7 Wireless Domestic 49 35 40.0 97 66 47.0 Int'l 45 18 - 90 41 - Directory & info. svcs. Domestic 11 8 37.5 20 15 33.3 Int'l 4 4 - 8 7 14.3 Corp. & Other 2 2 - 5 5 - -------- -------- -------- -------- Total $ 494 $ 426 16.0 $ 991 $ 839 18.1 ======== ======== ======== ======== Net Income (Loss) Cable & telecomm. Domestic $ (88) $ (113) 22.1 $ (207) $ (230) 10.0 Int'l (63) (69) 8.7 (120) (106) (13.2) Wireless Domestic 26 25 4.0 48 42 14.3 Int'l (42) (18) - (66) (42) (57.1) Directory & info. svcs. Domestic 77 68 13.2 154 134 14.9 Int'l 2 (5) - (8) (12) 33.3 Corp. & Other (6) (7) 14.3 (4) (16) 75.0 -------- -------- -------- -------- Total $ (94) $ (119) 21.0 $ (203) $ (230) 11.7 ======== ======== ======== ========
The 1996 amounts are pro forma as if the Continental Cablevision merger occurred January 1, 1996. EX-99 11 EX-99B2
EXHIBIT 99B.2 OTHER PROPORTIONATE INFORMATION U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended June 30, 1996 % In thousands unless noted 1997 Pro forma Change - - ---------------------------- --------- --------- --------- Cable & telecommunications Domestic Homes passed 12,302 11,928 3.1 Subscribers 7,674 7,362 4.2 International Homes passed 2,774 1,864 48.8 Subscribers 1,199 919 30.5 Wireless Domestic Cellular POPs-managed (millions) 20.3 20.0 1.5 Cellular subscribers 2,073 1,557 33.1 PCS POPs (millions) 14.7 13.7 7.3 PCS subscribers 46 - - International POPs (millions) 77.3 60.7 27.3 Subscribers 760 370 105.4 Directory & information svcs. Dex revenue per directory advertiser (whole dollars) $2,254 $2,098 7.4
The 1996 amounts are pro forma as if the Continental Cablevision merger occurred January 1, 1996. 7 EX-99 12 EX-99B3
EXHIBIT 99B.3 SELECTED FINANCIAL AND DOMESTIC CABLE OPERATING HIGHLIGHTS (UNAUDITED) Quarter Ended Six Months Ended June 30, June 30, Dollars in 1996 % 1996 % millions 1997 Pro formaChange 1997 Pro formaChange - - ------------------------ -------- -------------- -------- -------- Domestic Cable and Telecomm. Results Revenues Basic cable $ 379 $ 342 10.8 $ 747 $ 683 9.4 Premium 81 87 (6.9) 163 174 (6.3) Advertising 33 32 3.1 58 59 (1.7) Primestar 26 16 62.5 49 31 58.1 Pay-per-view 19 10 90.0 30 22 36.4 New prod. tier 3 1 - 5 1 - Other 44 45 (2.2) 85 82 3.7 -------- -------- -------- -------- Total Revenue $ 585 $ 533 9.8 $1,137 $1,052 8.1 -------- -------- -------- -------- EBITDA Core cable $ 254 $ 236 7.6 $ 489 $ 459 6.5 Primestar 4 2 - 8 4 - Other (21) (9) - (37) (15) - -------- -------- -------- -------- Total EBITDA $ 237 $ 229 3.5 $ 460 $ 448 2.7 -------- -------- -------- -------- EBITDA margins Core cable 45.8% 45.8% 45.4% 45.1% Primestar 15.4% 12.5% 16.3% 12.9% Other Operating & Financial Highlights Homes passed (thousands) 8,395 8,201 2.4 8,395 8,201 2.4 Subscribers (thousands): Basic cable 4,937 4,823 2.4 4,937 4,823 2.4 Primestar 158 103 53.4 158 103 53.4 Basic pen. 58.8% 58.8% 58.8% 58.8% Premium units 3,887 3,806 2.1 3,887 3,806 2.1 Premium/Basic 78.7% 78.9% 78.7% 78.9% High speed data cust. (actual) 6,443 - - 6,443 - - Core cbl. mnly. rev./avg. sub $38.20 $36.29 5.3 $37.34 $36.00 3.7
The 1996 amounts are pro forma as if the Continental Cablevision merger occurred January 1, 1996. 8 EX-99 13 EX-99B4
EXHIBIT 99B.4 PRO FORMA COMBINED STATEMENTS OF OPERATIONS U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Six Months Ended June 30, June 30, 1996 % 1996 % In millions 1997 Pro formaChange 1997 Pro formaChange - - -------------------------- ------- -------------- ------- ------- SALES AND OTHER REVENUES $1,277 $1,132 12.8 $2,484 $2,207 12.6 OPERATING EXPENSES Costs of sales and other revenues 430 376 14.4 836 743 12.5 Selling, general and administrative 360 337 6.8 680 653 4.1 Depreciation & amort 300 284 5.6 603 564 6.9 ---------------- ---------------- Total oper. expense 1,090 997 9.3 2,119 1,960 8.1 ---------------- ---------------- Income from operations 187 135 38.5 365 247 47.8 Interest expense 166 170 (2.4) 341 340 0.3 Equity losses in unconsol. ventures 153 91 68.1 318 166 91.6 Gains on sales of investments 44 - - 95 - - Guaranteed minority interest expense 22 12 83.3 44 24 83.3 Other income (expense) - net (5) (29) 82.8 (9) (40) 77.5 ---------------- ---------------- Loss before income tax benefit & extraord. item (115) (167) 31.1 (252) (323) 22.0 Income tax benefit 18 48 (62.5) 46 93 (50.5) ---------------- ---------------- Loss before extraord. item (97) (119) 18.5 (206) (230) 10.4 Extraordinary item: Early extinguishment of debt, net of tax 3 - - 3 - - ---------------- ---------------- NET LOSS (94) (119) 21.0 (203) (230) 11.7 Preferred dividends 12 13 (7.7) 25 25 - ---------------- ---------------- LOSS AVAILABLE FOR COMMON STOCK $ (106) $ (132) 19.7 $ (228) $ (255) 10.6 ================ ================
PRO FORMA COMBINED STATEMENTS OF OPERATIONS U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Six Months Ended June 30, June 30, In millions, except 1996 % 1996 % per share amounts 1997 Pro formaChange 1997 Pro formaChange - - -------------------------- ------- -------------- ------- ------- Average common shares outstanding 606.4 624.2 (2.9) 606.5 623.9 (2.8) ================ ================ Loss per common share ($0.17) ($0.21) 19.0 ($0.38) ($0.41) 7.3 ================ ================
Pro forma amounts reflect the Continental Cablevision, Inc. (Continental) merger, Continental's acquisition of the remaining interest in Meredith/New Heritage Strategic Partners, L.P. and the reclassification of the Teleport Communications Group, Inc. investment to equity method as if each transaction occurred as of January 1, 1996. Also includes Continental's results for cable-telephony ventures in Singapore and Argentina. The average common shares outstanding for the quarter ended and six months ended June 30, 1996, include 150.6 million shares related to the Continental merger as if it had occurred as of January 1, 1996. EX-99 14 EX-99B5
EXHIBIT 99B.5 SELECTED FINANCIAL DATA U S WEST MEDIA GROUP (UNAUDITED) Quarter Ended Six Months Ended June 30, June 30, 1996 % 1996 % In millions 1997 Pro formaChange 1997 Pro formaChange - - ------------------------------------------------------------------ Consolidated Revenues Cable & telecomm. Domestic $ 585 $ 533 9.8 $1,137 $1,052 8.1 Int'l 4 - - 8 - - Wireless Domestic 363 290 25.2 698 554 26.0 Directory & info. svcs. Domestic 296 279 6.1 583 550 6.0 Int'l 23 25 (8.0) 45 42 7.1 Corp. & Other 6 5 20.0 13 9 44.4 -------- -------- -------- -------- Total $1,277 $1,132 12.8 $2,484 $2,207 12.6 ======== ======== ======== ======== Consolidated EBITDA Cable & telecomm. Domestic $ 237 $ 229 3.5 $ 460 $ 448 2.7 Int'l (1) - - (3) - - Wireless Domestic 145 96 51.0 282 180 56.7 Int'l (6) - - (8) - - Directory & info. svcs. Domestic 141 123 14.6 280 241 16.2 Int'l 2 - - (2) (5) 60.0 Corp. & Other (31) (29) (6.9) (41) (53) 22.6 -------- -------- -------- -------- Total $ 487 $ 419 16.2 $ 968 $ 811 19.4 ======== ======== ======== ========
The 1996 amounts are pro forma as if the Continental Cablevision merger occurred January 1, 1996. EX-99 15 EX-99B6
EXHIBIT 99B.6 COMBINED BALANCE SHEETS U S WEST MEDIA GROUP (UNAUDITED) June 30, December 31, In millions 1997 1996 - - --------------------------------------- -------------------------- ASSETS Current assets: Cash and cash equivalents $ 155 $ 121 Accounts and notes receivable 514 508 Deferred directory costs 252 259 Marketable securities - 58 Other assets 203 193 -------------------------- Total current assets 1,124 1,139 -------------------------- Property, plant and equipment - net 4,581 4,275 Investment in Time Warner Entertainment 2,483 2,477 Net investment in international ventures 1,322 1,548 Intangible assets - net 12,461 12,595 Net investment in assets held for sale 416 409 Other assets 1,340 1,618 -------------------------- Total assets $ 23,727 $ 24,061 ========================== LIABILITIES AND EQUITY Current liabilities: Short-term debt $ 1,277 $ 217 Due to Continental shareholders - 1,150 Accounts payable 320 425 Deferred revenue and customer deposits 127 129 Other payables 925 795 -------------------------- Total current liabilities 2,649 2,716 -------------------------- Long-term debt 8,516 8,636 Deferred income taxes 3,577 3,600 Deferred credits and other 389 346 Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely Company-guaranteed debentures 1,080 1,080 Preferred stock subject to mandatory redemption 100 51 Media Group equity 7,488 7,723 Company LESOP guarantee (72) (91) -------------------------- Total equity 7,416 7,632 -------------------------- Total liabilities and equity $ 23,727 $ 24,061 ==========================
EX-99 16 EX-99B7
EXHIBIT 99B.7 INVESTING ACTIVITY U S WEST MEDIA GROUP Quarter Ended June 30, March 31, YTD In millions 1997 1997 Total - - ---------------------------- --------- --------- --------- Cable & telecommunications Domestic investments (1) $ 300 $ 261 $ 561 International investments 9 12 21 Wireless Domestic investments 123 141 264 International investments - 34 34 Directory & Other 6 16 22 Asset sales (2) (419) (206) (625) --------- --------- --------- Total $ 19 $ 258 $ 277 ========= ========= ========= Valuation of Investments Publicly Traded Price per share Total # of Shs as of Value (thousands) 7/25/97 (millions) --------- --------- --------- Telewest (TWSTY) 37,875 $12.75 $482.9 Teleport (TCGI) 11,786 37.81 445.6 Home Shopping Network (HSNI) 220 36.69 8.1 (1) Excludes $1,150 paid to Continental shareholders in first quarter 1997. (2) Excludes Minnesota cable systems.
EX-99 17 EX-99C1
EXHIBIT 99C.1 CONSOLIDATED STATEMENTS OF U S WEST, Inc. OPERATIONS (UNAUDITED) Quarter Ended Six Months Ended June 30, % June 30, % In millions 1997 1996 Change 1997 1996 Change - - ---------------------- ------- ------- ------ ------- ------- ------- SALES & OTHER REVENUES $3,787 $3,124 21.2 $7,553 $6,174 22.3 OPERATING EXPENSES Employee-related 1,215 1,098 10.7 2,363 2,141 10.4 Other operating 820 609 34.6 1,662 1,200 38.5 Taxes other than income taxes 115 111 3.6 239 218 9.6 Depreciation & amort 830 588 41.2 1,660 1,172 41.6 ------- -------- ------- -------- Total oper expenses 2,980 2,406 23.9 5,924 4,731 25.2 ------- -------- ------- -------- Income from operations 807 718 12.4 1,629 1,443 12.9 Interest expense 266 136 95.6 544 271 - Equity losses in unconsol ventures 153 77 98.7 318 143 - Gains on sales of investments 44 - - 95 - - Gains on sales of rural telephone exchanges 29 49 (40.8) 47 49 (4.1) Guaranteed minority interest expense 22 12 83.3 44 24 83.3 Other expense - net 24 23 4.3 50 46 8.7 ------- -------- ------- -------- Income before inc taxes, extd item & cum effect of chg in acctg princ 415 519 (20.0) 815 1,008 (19.1) Income tax provision 180 206 (12.6) 350 398 (12.1) ------- -------- ------- -------- Income before extd item & cum effect of chg in acctg princ 235 313 (24.9) 465 610 (23.8) Extraordinary item: Early extinguishment of debt - net of tax 3 - - 3 - - ------- -------- ------- -------- Income before cum effect of chg in acctg princ 238 313 (24.0) 468 610 (23.3) Cumulative effect of change in accounting principle - net of tax - - - - 34 - ------- -------- ------- -------- NET INCOME 238 313 (24.0) 468 644 (27.3) Preferred dividends 12 1 - 25 2 - ------- -------- ------- -------- EARNINGS AVAILABLE FOR COMMON STOCK $ 226 $ 312 (27.6)$ 443 $ 642 (31.0) ======= ======== ======= ========
CONSOLIDATED STATEMENTS OF U S WEST, Inc. OPERATIONS (UNAUDITED) Quarter Ended Six Months Ended In millions, except June 30, % June 30, % per share amounts 1997 1996 Change 1997 1996 Change - - ---------------------- ------- ------- ------ ------- ------- ------- COMMUNICATIONS GROUP: Average common shares outstanding 482.5 476.8 1.2 481.9 475.9 1.3 ======= ======== ======= ======== Earnings per common share: Income before cumulative effect of change in accounting principle $ 0.69 $ 0.68 1.5 $1.39 $1.30 6.9 Cumulative effect of change in accounting principle - - - - 0.07 - ------- -------- ------- -------- Earnings per common share $ 0.69 $ 0.68 1.5 $1.39 $1.37 1.5 ======= ======== ======= ======== MEDIA GROUP: Average common shares outstanding 606.4 473.6 28.0 606.5 473.3 28.1 ======= ======== ======= ======== Loss per common share $(0.17) $(0.03) - $(0.38) $(0.02) - ======= ======== ======= ========
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended Six Months Ended June 30, % June 30, % Dollars in millions 1997 1996 Change 1997 1996 Change - - ---------------------- ------- ------- ------ ------- ------- ------- SELECTED CONSOLIDATED DATA Capital expenditures $ 868 $ 758 14.5 $1,597 $1,561 2.3 Debt-to-capital ratio (1) 55.0% 54.8%# - 55.0% 54.8%# - Employees 67,668 61,399 10.2 67,668 61,399 10.2 EBITDA $1,637 $1,306 25.3 $3,289 $2,615 25.8 EBITDA margin 43.2% 41.8% - 43.5% 42.4% - As of December 31, 1996. 1 Ratio includes preferred securities and other preferred stock subject to mandatory redemption as a component of total capital. Including debt related to the net investment in assets held for sale, preferred securities and other preferred stock subject to mandatory redemption, the Company's percentage of debt to total capital was 59.8% and 59.5% at June 30, 1997 and December 31, 1996, respectively.
EX-99 18 EX-99C2
EXHIBIT 99C.2 CONSOLIDATED BALANCE SHEETS U S WEST, Inc. (UNAUDITED) June 30, December 31, In millions 1997 1996 --------------------------------------- ------------- ----------- ASSETS Current assets: Cash and cash equivalents $ 244 $ 201 Accounts and notes receivable 2,104 2,113 Inventories and supplies 218 159 Deferred tax asset 237 213 Prepaid and other 356 426 ------------- ----------- Total current assets 3,159 3,112 ------------- ----------- Property, plant and equipment - net 18,286 18,281 Investment in Time Warner Entertainment 2,483 2,477 Net investment in international ventures 1,322 1,548 Intangible assets - net 12,516 12,595 Net investment in assets held for sale 416 409 Other assets 2,184 2,433 ------------- ----------- Total assets $ 40,366 $ 40,855 ============= =========== LIABILITIES AND SHAREOWNERS' EQUITY Current liabilities: Short-term debt $ 1,443 $ 1,051 Accounts payable 1,250 1,316 Due to Continental Cablevision shareholders - 1,150 Dividends payable 266 263 Other payables 2,702 2,294 ------------- ----------- Total current liabilities 5,661 6,074 ------------- ----------- Long-term debt 14,135 14,300 Postretirement and other postemployment benefit obligations 2,492 2,479 Deferred taxes 4,343 4,349 Deferred credits and other 989 973 Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely Company-guaranteed debentures 1,080 1,080 Preferred stock subject to mandatory redemption 100 51 Shareowners' equity: Preferred shares 921 920 Common shares 10,776 10,741 Retained earnings (deficit) (17) 18 LESOP guarantee (72) (91) Foreign currency translation adjustments (42) (39) ------------- ----------- Total shareowners' equity 11,566 11,549 ------------- ----------- Total liabilities & shareowners' equity $ 40,366 $ 40,855 ============== ==========
EX-99 19 EX-99C3
EXHIBIT 99C.3 CONSOLIDATED STATEMENTS OF U S WEST, Inc. CASH FLOWS (UNAUDITED) Six Months Ended June 30, In millions 1997 1996 - - --------------------------------------------------------------------- OPERATING ACTIVITIES Net income $ 468 $ 644 Adjustments to net income: Depreciation and amortization 1,660 1,172 Equity losses in unconsolidated ventures 318 143 Gains on sales of investments (95) - Gains on sales of rural telephone exchanges (47) (49) Cumulative effect of change in accounting principle - (34) Deferred income taxes and amortization of investment tax credits (85) (50) Changes in operating assets and liabilities: Restructuring payments (50) (82) Postretirement medical and life costs, net of cash fundings 10 (24) Accounts and notes receivable (11) 21 Inventories, supplies and other (91) (45) Accounts payable and accrued liabilities 384 (55) Other - net 117 (10) - - --------------------------------------------------------------------- Cash provided by operating activities 2,578 1,631 - - --------------------------------------------------------------------- INVESTING ACTIVITIES Expenditures for property, plant and equipment (1,558) (1,509) Investment in Continental Cablevision (1,150) - Investment in international ventures (44) (139) Proceeds from asset sales 575 - Proceeds from disposals of property, plant and equipment 32 104 Cash from net investment in assets held for sale 50 93 Other - net (141) (74) - - --------------------------------------------------------------------- Cash (used for) investing activities (2,236) (1,525) - - --------------------------------------------------------------------- FINANCING ACTIVITIES Proceeds from (repayments of) short-term debt - net (3,714) 340 Proceeds from issuance of long-term debt 4,110 330 Repayments of long-term debt (193) (476) Dividends paid on common and preferred stock (498) (469) Proceeds from issuance of common stock 49 104 Purchases of treasury stock (53) - - - --------------------------------------------------------------------- Cash (used for) financing activities (299) (171) - - --------------------------------------------------------------------- CASH AND CASH EQUIVALENTS Decrease 43 (65) Beginning balance 201 192 - - --------------------------------------------------------------------- Ending balance $ 244 $ 127 =====================================================================
EX-27 20 FDS
5 0000732718 U S WEST, INC. 1,000,000 3-MOS 6-MOS DEC-31-1997 DEC-31-1997 JUN-30-1997 JUN-30-1997 244 244 0 0 2,104 2,104 0 0 218 218 3,159 3,159 38,547 38,547 20,261 20,261 40,366 40,366 5,661 5,661 14,135 14,135 1,180 1,180 921 921 10,776 10,776 (131) (131) 40,366 40,366 3,787 7,553 3,787 7,553 0 0 0 0 2,980 5,924 0 0 266 544 415 815 180 350 235 465 0 0 3 3 0 0 238 468 0.69 1.39 0.69 1.39
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