-----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, D1HQnTclgUqGLtRjZ0w/fhkqlbXLVP35JUpdcEqRWNhNeXJ3PxESq0m94KKUTh5Y LPj7WpOok1EKHWxO46WA3Q== 0000950130-96-001602.txt : 19960701 0000950130-96-001602.hdr.sgml : 19960701 ACCESSION NUMBER: 0000950130-96-001602 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960510 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CELLULAR COMMUNICATIONS OF PUERTO RICO INC CENTRAL INDEX KEY: 0000881817 STANDARD INDUSTRIAL CLASSIFICATION: 4812 IRS NUMBER: 133517074 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 033-44420 FILM NUMBER: 96558921 BUSINESS ADDRESS: STREET 1: 110 EAST 59TH STREET STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212-906-8440 MAIL ADDRESS: STREET 1: 110 EAST 59TH STREET STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 10-Q 1 FORM 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1996 OR [_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 0-19869 ---------------------------------------------- CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. ---------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 13-3517074 - - --------------------------------------- ----------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 110 East 59th Street, New York, NY 10022 - - --------------------------------------- ----------------------- (Address of principal executive offices) (Zip Code) (212) 355-3466 - - ------------------------------------------------------------------------------ (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ---- ---- The number of shares outstanding of the issuer's common stock as of March 31, 1996 was 13,427,438. CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES INDEX Page PART I. FINANCIAL INFORMATION - - ------------------------------- Item 1. Financial Statements Condensed consolidated balance sheets-- March 31, 1996 and December 31, 1995 2 Condensed consolidated statements of operations-- Three months ended March 31, 1996 and 1995 4 Condensed consolidated statement of shareholders' equity--Three months ended March 31, 1996 5 Condensed consolidated statements of cash flows-- Three months ended March 31, 1996 and 1995 6 Notes to condensed consolidated financial statements 7 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition 10 PART II. OTHER INFORMATION - - -------------------------- Item 6. Exhibits and Reports on Form 8-K 13 SIGNATURES 14 - - ---------- PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, December 31, 1996 1995 ------------- ------------- (Unaudited) (See Note) ASSETS CURRENT ASSETS Cash and cash equivalents $ 10,373,000 $ 8,050,000 Accounts receivable-trade, less allowance for doubtful accounts of $3,227,000 (1996) and $3,233,000 (1995) 18,215,000 17,929,000 Equipment inventory 3,825,000 6,388,000 Prepaid expenses and other current assets 1,498,000 2,600,000 ------------ ------------ TOTAL CURRENT ASSETS 33,911,000 34,967,000 PROPERTY, PLANT & EQUIPMENT, net 78,096,000 75,769,000 UNAMORTIZED LICENSE ACQUISITION COSTS 161,046,000 139,952,000 DEFERRED FINANCING COSTS, less accumulated amortization of $607,000 (1996) and $455,000 (1995) 4,562,000 4,706,000 OTHER ASSETS, less accumulated amortization of $1,554,000 (1996) and $1,471,000 (1995) 1,317,000 1,603,000 ------------ ------------ $278,932,000 $256,997,000 ============ ============
Note: The balance sheet at December 31, 1995 has been derived from the audited financial statements at that date. 2 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS--Continued
March 31, December 31, 1996 1995 ------------ ------------ (Unaudited) (See Note) LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 2,478,000 $ 5,874,000 Accrued expenses 14,197,000 10,895,000 Due to Cellular Communications, Inc. 263,000 310,000 Interest payable 587,000 615,000 Deferred revenue 2,612,000 2,854,000 Current portion of long term debt 1,750,000 1,975,000 ------------ ------------ TOTAL CURRENT LIABILITIES 21,887,000 22,523,000 LONG TERM DEBT 90,000,000 90,000,000 COMMITMENTS AND CONTINGENT LIABILITIES MINORITY INTERESTS - 322,000 SHAREHOLDERS' EQUITY Series preferred stock-$.01 par value; authorized 2,500,000 shares; issued and outstanding none - - Common stock-$.01 par value; authorized 30,000,000 shares; issued 13,634,000 (1996) and 12,803,000 (1995) shares 136,000 128,000 Additional paid-in capital 232,242,000 210,646,000 (Deficit) (59,188,000) (60,477,000) ------------ ------------ 173,190,000 150,297,000 Treasury stock-at cost, 207,000 shares (6,145,000) (6,145,000) ------------ ------------ 167,045,000 144,152,000 ------------ ------------ $278,932,000 $256,997,000 ============ ============
See notes to condensed consolidated financial statements. 3 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended March 31, ---------------------------- 1996 1995 ------------- ------------- Revenues: Service revenue $ 28,513,000 $ 19,489,000 Equipment revenue 2,963,000 3,315,000 ------------- ------------- 31,476,000 22,804,000 Costs and expenses: Cost of equipment sold 4,680,000 5,264,000 Operating expenses 3,885,000 2,189,000 Selling, general and administrative expenses 13,647,000 10,763,000 Depreciation of rental equipment 115,000 74,000 Depreciation expense 2,888,000 1,886,000 Amortization expense 1,527,000 1,354,000 ------------- ------------- 26,742,000 21,530,000 ------------- ------------- OPERATING INCOME 4,734,000 1,274,000 Other income (expense): Interest income and other, net 60,000 198,000 Interest expense (1,779,000) (2,185,000) ------------- ------------- INCOME(LOSS) BEFORE INCOME TAX PROVISION 3,015,000 (713,000) Income tax provision (1,726,000) (536,000) ------------- ------------- NET INCOME (LOSS) $ 1,289,000 $ (1,249,000) ============= ============= Net income (loss) per common share $ .09 $ (.12) ============= ============= Weighted average number of common shares used in computation of net income(loss) per share including common stock equivalents 13,932,000 10,008,000 ============= =============
See notes to condensed consolidated financial statements. 4 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
Common Stock Additional Treasury Stock -------------------------- Paid-in -------------------------- Shares Amount Capital Deficit Shares Amount ------------ ------------ ------------ ------------ ------------ ------------ Balance, December 31, 1995 12,803,000 $128,000 $210,646,000 $(60,477,000) (207,000) $(6,145,000) Shares issued for interests in cellular license 820,000 8,000 21,528,000 Exercise of stock options 11,000 68,000 Net income for the three months ended March 31, 1996 1,289,000 ------------ ------------ ------------ ------------ ------------ ------------ Balance, March 31, 1996 13,634,000 $ 136,000 $232,242,000 $(59,188,000) (207,000) $(6,145,000) ============ ============ ============ ============ ============ ===========
See notes to condensed consolidated financial statements. 5 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three Months Ended March 31, ---------------------------------- 1996 1995 -------------- -------------- NET CASH PROVIDED BY OPERATING ACTIVITIES $ 9,987,000 $ 614,000 INVESTING ACTIVITIES Purchase of property, plant and equipment (6,327,000) (5,472,000) Purchase of marketable securities - (2,058,000) Proceeds from maturities of marketable securities - 11,057,000 -------------- -------------- NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (6,327,000) 3,527,000 -------------- -------------- FINANCING ACTIVITIES Distributions to minority interest holders (1,172,000) - Principal payments (225,000) - Additional deferred financing costs (8,000) (135,000) Proceeds from exercise of stock options 68,000 133,000 -------------- -------------- NET CASH (USED IN) FINANCING ACTIVITIES (1,337,000) (2,000) -------------- -------------- INCREASE IN CASH AND CASH EQUIVALENTS 2,323,000 4,139,000 Cash and cash equivalents at beginning of period 8,050,000 6,311,000 -------------- -------------- Cash and cash equivalents at end of period $ 10,373,000 $ 10,450,000 ============== ============== Supplemental disclosure of cash flow information: Cash paid during the period for interest exclusive of amounts capitalized $ 1,815,000 $ 1,651,000 Income taxes paid 481,000 Supplemental schedule of noncash investing activities: Common stock issued to acquire cellular license interests $ 21,536,000 Liabilities incurred to acquire property, plant and equipment 1,519,000 $ 5,275,000
See notes to condensed consolidated financial statements. 6 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE A--BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 1996 are not necessarily indicative of the results that may be expected for the year ending December 31, 1996. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 1995. Net income (loss) per share is computed based upon the weighted average number of common shares outstanding during the periods, including common stock equivalents in the net income per share computation. Common stock equivalents are excluded from the calculation of net loss per share as their effect would be antidilutive. NOTE B--ACCOUNTING CHANGE In October 1995, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation." Although all entities are encouraged to adopt this method of accounting for all employee stock compensation plans, SFAS No. 123 allows an entity to continue to measure compensation costs for its plans as prescribed by APB Opinion No. 25, "Accounting for Stock Issued to Employees." At this time, management expects to continue its accounting in accordance with APB Opinion No. 25. NOTE C--UNAMORTIZED LICENSE ACQUISITION COSTS
March 31, December 31 1996 1995 ------------ ------------- (Unaudited) Deferred cellular license costs $ 5,935,000 $ 5,935,000 Excess of purchase price paid over the fair market value of tangible assets acquired 183,509,000 161,123,000 ------------ ------------ 189,444,000 167,058,000 Accumulated amortization 28,398,000 27,106,000 ------------ ------------ $161,046,000 $139,952,000 ============ ============
In February 1996, the Company acquired the remaining minority interests aggregating appoximately 6% in the San Juan Cellular Telephone Company in exchange for approximately 820,000 shares of the Company's common stock. The stock was valued at $21,536,000, the fair market value on the date of acquisition. In addition, the San Juan Cellular Telephone Company made a special cash distribution of $1,172,000 to the minority interest holders. The aggregate purchase price of $21,536,000, plus the deficiency in net assets acquired of $850,000, have been classified as license acquisition costs. 7 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-Continued NOTE D--PROPERTY, PLANT AND EQUIPMENT
March 31, December 31, 1996 1995 ------------- ------------ (Unaudited) Land $ 1,962,000 $ 1,962,000 Operating equipment 76,987,000 73,152,000 Office furniture and other equipment 13,371,000 12,092,000 Rental equipment 851,000 739,000 Construction in progress 13,492,000 13,535,000 ------------ ------------ 106,663,000 101,480,000 Allowance for depreciation 28,567,000 25,711,000 ------------ ------------ $ 78,096,000 $ 75,769,000 ============ ============ NOTE E--ACCRUED EXPENSES March 31, December 31, 1996 1995 ------------ ------------ (Unaudited) Accrued compensation $ 1,198,000 $ 1,056,000 Accrued franchise, property and income taxes 6,656,000 5,354,000 Commissions payable 1,172,000 349,000 Accrued equipment purchases 1,127,000 280,000 Subscriber deposits 1,930,000 1,952,000 Other 2,114,000 1,904,000 ------------ ------------ $ 14,197,000 $ 10,895,000 ============ ============ NOTE F--LONG-TERM DEBT March 31, December 31, 1996 1995 ------------ ------------ (Unaudited) Bank loan $ 90,000,000 $ 90,000,000 Subsidiary note payable 225,000 Subsidiary note payable 1,750,000 1,750,000 ------------ ------------ 91,750,000 91,975,000 Less current portion 1,750,000 1,975,000 ------------ ------------ $ 90,000,000 $ 90,000,000 ============ ============
8 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-Continued NOTE G--TREASURY STOCK In April 1996, the Company announced that its Board of Directors authorized the repurchase of up to an additional 750,000 shares of the Company's common stock through open market purchases from time to time as market conditions warrant. This repurchase plan is in addition to a previously announced repurchase plan for up to 250,000 shares. To date, the Company has repurchased 400,000 shares for an aggregate of $11,334,000, of which 207,000 shares for an aggregate of $6,145,000 were repurchased through March 31, 1996. NOTE H--COMMITMENTS AND CONTINGENT LIABILITIES As of March 31, 1996, the Company was committed to purchase approximately $13,409,000 for cellular network and other equipment and for construction services. In addition, as of March 31, 1996, the Company had commitments to purchase cellular telephones, pagers and accessories of approximately $676,000. In 1992, the Company entered into an agreement which in effect provides for a twenty year license to use its service mark which is also licensed to many of the non-wireline cellular systems in the United States. The Company is required to pay licensing and advertising fees and to maintain certain service quality standards. The total fees paid for 1996 were $202,000 which were determined by the size of the Company's markets. 9 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION. RESULTS OF OPERATIONS Three Months Ended March 31, 1996 and 1995 - - ------------------------------------------ Service revenue increased to $28,513,000 from $19,489,000 as a result of subscriber growth that increased the Company's current revenue stream. Average monthly revenue per subscriber for the first quarter decreased to $78 in 1996 from $85 in 1995. Ending subscribers were 127,800 and 85,000 as of March 31, 1996 and 1995, respectively. The loss from equipment, before depreciation of rental equipment, decreased to $1,717,000 from $1,949,000 primarily because of reductions in the cost of cellular telephones offset by an increase in the loss from pager sales. The Company sells cellular telephones and pagers below cost in response to competition and to generate subscriber growth. Operating expenses increased to $3,885,000 from $2,189,000 primarily due to increased usage of the network and additional costs associated with the expanded network (including paging operations), which account for 80% and 20% of the increase, respectively. Selling, general and administrative expenses increased to $13,647,000 from $10,763,000 as a result of increased selling and marketing to increase the customer base and additional personnel to service the expanding customer base. Increases in bad debt expense and subscriber billing expense also contributed to this increase. The increases in selling and marketing costs, personnel costs, bad debt expense and subscriber billing expense were 26%, 9%, 23% and 14%, respectively, of the total $2,884,000 increase. Depreciation of rental equipment increased to $115,000 from $74,000 due to an increase in the number of rental pagers, offset by a decrease in rental telephone depreciation due to rental telephones becoming fully depreciated. Depreciation expense increased to $2,888,000 from $1,886,000 because of an increase in property, plant and equipment. Amortization expense increased to $1,527,000 from $1,354,000 primarily due to increases in license acquisition costs. Interest income and other, net, decreased to $60,000 from $198,000 due to a decrease in interest income on short term investments and an increase in losses on disposals of equipment. Interest expense decreased to $1,779,000 from $2,185,000 primarily because of reductions in the principal balance and interest rates on the Company's debt. The provision for income taxes increased to $1,726,000 from $536,000 as a result of an increase in Puerto Rico or U.S. Virgin Islands taxable income of certain of the Company's consolidated subsidiaries. Paging operations commenced in the second quarter of 1995. As of March 31, 1996, there were 17,800 pagers in use. 10 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES (Continued) In October 1995, the FASB issued SFAS No. 123, "Accounting for Stock-Based Compensation". Although all entities are encouraged to adopt this method of accounting for all employee stock compensation plans, Statement No. 123 allows an entity to continue to measure compensation costs for its plans as prescribed by APB Opinion No. 25, "Accounting for Stock Issued to Employees." At this time, management expects to continue its accounting in accordance with APB Opinion No. 25. LIQUIDITY AND CAPITAL RESOURCES The Company requires capital to expand its cellular network, for its paging business and for debt service. The Company is currently adding cell sites and increasing capacity throughout its Puerto Rico and U.S. Virgin Islands markets. The Company expects to use approximately $19,100,000 through 1996 for contemplated additions to the cellular system, for its paging business and for other non-cell site related capital expenditures. As of March 31, 1996, debt service through 1996 for the outstanding debt at the rates in effect on March 31, 1996 was expected to be approximately $6,700,000. The Company's commitments at March 31, 1996 of $13,409,000 for cellular network and other equipment and for construction services are included in the total anticipated expenditures. The Company will be able to meet these requirements with cash on hand, cash from operations or borrowings under its revolving credit facility. The preceding forward-looking statements are based on the Company's current expectations which are subject to a number of risks and uncertainties that could materially reduce demand for the Company's cellular and/or paging service, thereby reducing the need for capacity expansion and reducing the operating cash flows from such service. The primary risks and uncertainties include, but are not limited to: a change in economic conditions in the Company's markets which adversely effects the level of demand for cellular and/or paging services, greater than anticipated competition resulting in price reductions or higher customer acquisition costs, and earlier than expected competition from new wireless services. In addition, increased cellular fraud could reduce operating cash flow while increasing the need for capacity expansion. In April 1996, the Company announced that its Board of Directors authorized the repurchase of up to an additional 750,000 shares of the Company's common stock through open market purchases from time to time as market conditions warrant. This repurchase plan is in addition to a previously announced repurchase plan for up to 250,000 shares. To date, the Company has repurchased 400,000 shares for an aggregate of $11,334,000, of which 207,000 shares for an aggregate of $6,145,000 were repurchased through March 31, 1996. In April 1995, the Company and one of its subsidiaries entered into a $200,000,000 revolving credit facility with various banks. To date, the Company has borrowed $95,000,000. The line of credit is available until March 31, 1999, on which date it converts into a term loan with principal payments based on an amortization schedule until September 30, 2003. The terms include the payment of interest each quarter at a floating rate, which is, at the borrower's option, either (a) the higher of the bank's base rate or the Federal Funds Rate plus 1/2%, (b) the London Interbank Offering Rate or (c) the 936 Rate, plus, based on the ratio of the Company's debt to cash flow and the floating rate in effect, either .25% to 11 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES (Continued) 1.875% or 1.25% to 2.875%. The effective rate on the Company's borrowings as of March 31, 1996 was 6.66%. The terms also include an unused commitment fee of 1/2% per annum which is payable quarterly. Subject to the restrictions described below, the line of credit is available for funding capital expenditures, stock repurchases up to $60,000,000, acquisitions of or investments in communications related businesses in Puerto Rico, the southeastern United States and other approved countries, and for working capital and other general corporate purposes. In connection with the loan agreement, the Company has pledged to the banks the stock of the Company's subsidiaries and has given the banks a security interest in the Company and its subsidiaries' assets and a guaranty by the Company and its subsidiaries of the obligations of the borrowers under the loan agreement. The loan agreement also includes, among other things, restrictions on (i) dividends, (ii) acquisitions and investments, (iii) sales and dispositions of assets, (iv) additional indebtedness and (v) liens, and requires the maintenance of certain ratios of indebtedness to cash flow, fixed charges to cash flow and debt service to cash flow. Cash provided by operating activities was $9,987,000 and $614,000 in 1996 and 1995, respectively. The increase in cash flow from operating activities is primarily a result of the increase in net income and from changes in operating assets and liabilities. Purchases of property, plant and equipment of $6,327,000 were primarily for additional cell sites and increased capacity in the Company's cellular and paging systems. The San Juan Cellular Telephone Company made a special cash distribution of $1,172,000 to its minority interest holders in 1996. The Company repaid a $225,000 subsidiary note payable on its due date in January 1996. The allowance for doubtful accounts was $3,227,000 and $3,233,000 as of March 31, 1996 and December 31, 1995, respectively. Write-offs net of recoveries as a percentage of service revenue was 5.4% for the three months ended March 31, 1996 compared to 4.8% for the year ended December 31, 1995. The bad debt percentage may remain at the current level as the subscriber base continues to grow. The Company may also require additional capital for acquisitions of minority interests in its Aguadilla or Adjuntas markets, or for the acquisition of certain RSAs, PCS licenses or in other telecommunications related industries, if opportunities for such acquisitions arise. The Company has from time to time engaged in discussions with third parties regarding such acquisitions. 12 CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. AND SUBSIDIARIES PART II. OTHER INFORMATION ITEM 5. OTHER EVENTS (a) On May 9, 1996 the Company announced that it is reviewing strategic alternatives to enhance shareholder value. The Company believes that Puerto Rico serves as the U.S. gateway to the Caribbean and Latin America. It also sees the considerable benefits of scale and scope inherent in regional and super-regional telecommunications networks. As a consequence, the Company's Board of Directors has authorized the review of strategic alternatives to enhance shareholder value including the exploration of partnering opportunities in the region through a business combination, an appropriate acquisition, the sale of the Company, or similar transactions. The Company noted that no decision has been made to pursue any particular alternative and that there can be no assurance that any transaction will result from this review. Salomon Brothers Inc has been engaged by the Company to aid it in this matter. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits Included Within: ------------------------ (27) Financial Data Schedule (b) Reports on Form 8-K No reports on Form 8-K were filed by the Company during the quarter ended March 31, 1996. 13 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CELLULAR COMMUNICATIONS OF PUERTO RICO, INC. Date: May 7, 1996 By: /s/ J. Barclay Knapp --------------------------- J. Barclay Knapp President Date: May 7, 1996 By: /s/ Gregg Gorelick --------------------------- Gregg Gorelick Vice President-Controller (Principal Accounting Officer) 14 EX-27 2 FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1996 JAN-01-1996 MAR-31-1996 10,373,000 0 21,442,000 (3,227,000) 3,825,000 1,498,000 106,663,000 28,567,000 278,932,000 21,887,000 90,000,000 0 0 136,000 166,909,000 278,932,000 2,963,000 31,476,000 4,680,000 8,565,000 13,647,000 0 1,779,000 3,015,000 1,726,000 1,289,000 0 0 0 1,289,000 .09 0
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