Centennial Cellular Corp. Announces Record Year End and Fourth Fiscal Quarter Results.NEW YORK--(BUSINESS WIRE)--August 20, 1998--Centennial Cellular Corp. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CYCL) announced record results for the year and quarter ending May 31, 1998. Total revenue for the quarter ended May 31, 1998 was $66,335,000 up $22,210,000 or 50.3% over revenue of $44,125,000 in the quarter ended May 31, 1997. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. before depreciation and amortization for the quarter ended May 31, 1998 was $34,117,000, an increase of $19,263,000 or 129.7% over the $14,854,000 recorded for the quarter ended May 31, 1997. Revenue from Centennial's domestic wireless telephone business was $47,702,000 for the quarter ended May 31, 1998, an increase of $7,987,000 or 20.1% over revenue of $39,715,000 recorded for the quarter ended May 31, 1997. Operating income before depreciation and amortization for the quarter ended May 31, 1998 in Centennial's domestic wireless telephone business was $26,574,000, an increase of $8,990,000 or 51.1% above the quarter ended May 31, 1997. The Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. Wireless Telephone System began operations on December 12, 1996. Revenue from the Company's Puerto Rico Wireless Telephone System for the quarter ended May 31, 1998 was $18,633,000 an increase of $14,223,000 over revenue of $4,410,000 recorded for the quarter ended May 31, 1997. Operating income before depreciation and amortization in the Puerto Rico Wireless Telephone System for the quarter ended May 31, 1998 was $7,543,000, an increase of $10,273,000 above the operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. before depreciation and amortization of $2,730,000 for the quarter ended May 31, 1997. The consolidated net loss for the quarter was $5,865,000 compared to a net loss of $11,581,000 for the quarter ended May 31, 1997. After dividends payable Dividends payable The declared dividend dollar amount that a company is obligated to pay. on preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. , the Company's loss per common share was $(.39) and $(.58) for the quarters ended May 31, 1998 and 1997, respectively. Total revenue for the year ended May 31, 1998 was $237,501,000, an increase of $86,478,000 or 57.3% over revenue of $151,023,000 for the year ended May 31, 1997. Operating income before depreciation and amortization for the year ended May 31, 1998 was $100,893,000, an increase of $43,230,000 or 75.0% over the $57,663,000 recorded for the year ended May 31, 1997. Revenue from Centennial's domestic wireless telephone business was $182,944,000 for the year ended May 31, 1998, an increase of $37,824,000 or 26.1% over revenue of $145,120,000 recorded for the year ended May 31, 1997. Operating income before depreciation and amortization in Centennial's domestic wireless telephone business for the year ended May 31, 1998 was $88,112,000, an increase of $22,031,000 or 33.3% above the year ended May 31, 1997. Revenue from the Company's Puerto Rico Wireless Telephone System for the year ended May 31, 1998 was $54,557,000, an increase of $48,654,000 over revenue of $5,903,000 recorded for the year ended May 31, 1997. Operating income before depreciation and amortization in the Puerto Rico Wireless Telephone System for the year ended May 31, 1998 was $12,781,000, an increase of $21,199,000 above the operating loss before depreciation and amortization of $8,418,000 for the year ended May 31, 1997. The net loss for the year ended May 31, 1998 was $31,947,000 as compared to a net loss of $33,295,000 for the year ended May 31, 1997, After dividends payable on preferred stock, the Company's loss per common share was $(1.85) and $(1.83) for the year ended May 31, 1998 and 1997, respectively. The Company's wireless telephone subscribers at May 31, 1998 were 322,200 as compared to 203,900 at May 31, 1997, an increase of 118,300 subscribers or 58.0%. Domestic wireless telephone subscribers increased by 65,700 or 35.1% from 187,000 subscribers at May 31, 1997, due primarily to internal growth of subscribers in systems which it owned and operated at May 31, 1997. Subscribers of the Company's Puerto Rico Wireless Telephone System totaled 69,500 and 16,900 at May 31, 1998 and 1997, respectively. The Company's Puerto Rico Wireless Telephone System accounted for 44.5% of the Company's total subscriber increase. During the year ended May 31, 1998, the Company purchased 1,543,400 shares of its Class A Common Stock for an aggregate purchase price of $28,924,000. As of August 20, 1998, the Company is authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: to purchase 2,729,800 additional shares of its Class A Common Stock in the open market pursuant to previous authorizations by the Company's Board of Directors. On July 2, 1998, the Company and CCW (Continuous Composite Write) A magneto-optic disk technology that emulates a WORM (Write Once Read Many) disk. It uses firmware in the drive to ensure that data cannot be erased and rewritten. Acquisition Corp. ("Acquisition"), a Delaware corporation A Delaware corporation is a corporation chartered in the U.S. state of Delaware. Delaware is well known as a corporate haven, and thus, over 50% of US publicly-traded corporations and 58% of the Fortune 500 companies are incorporated in the state. organized at the direction of Welsh, Carson, Anderson & Stowe VIII, L.P. ("WCAS WCAS Weinberg College of Arts and Sciences WCAS Warfighter Communication Assessment System (US DoD) VIII"), entered into an Agreement and Plan of Merger (the "Merger Agreement") providing for the merger of Acquisition with and into Centennial (the "Merger"). Centennial will continue as the surviving corporation (the "Surviving Corporation") in the Merger. The transaction is valued at approximately $2.0 billion, including indebtedness INDEBTEDNESS. The state, of being in debt, without regard to the ability or inability of the party to pay the same. See 1 Story, Eq. 343; 2 Hill. Ab. 421. 2. of approximately $515 million to be refinanced. Centennial will continue to operate as an independent company under its current name and management. Subject to proration Proration A situation during a corporate action in which the available cash or shares are not sufficient to satisfy the offers tendered by shareholders. Therefore, a proportion of both cash and shares is granted for each offer tendered. , pursuant to the Merger Agreement, outstanding shares of Class A Common Stock of Centennial will be converted into the right to receive $43.50 per share in cash or to retain up to 7.1% of the common stock of the Surviving Corporation. Class B Common Stock of Centennial will be converted into the right to receive $43.50 per share in cash; provided, that if the aggregate number of Class A Common Stock elected to be retained by Centennial's existing stockholders is less than 7.1% of the shares outstanding after the Merger, then a number of shares of Class B Common Stock equal to the pro-rata portion of such shortfall will be converted into shares of Class A Common Stock and retained. All outstanding shares of Convertible Redeemable Redeemable Eligible for redemption under the terms of an indenture. Preferred Stock and Second Series Convertible Redeemable Preferred Stock of Centennial will be converted into the right to receive $43.50 per share in cash on an as converted basis. The transaction was structured to be accounted for as a recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. . Following the Merger, the stockholders of Acquisition will own 92.9% of the outstanding shares of the Surviving Corporation. In connection with the Merger, Acquisition has received a commitment from a third party for financing for Acquisition and certain existing and future subsidiaries of the Company in the aggregate amount of approximately $1.6 billion in the form of senior secured credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities and an unsecured Unsecured A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge. bridge loan. Additionally, an affiliate of WCAS VIII has agreed to purchase approximately $150 million aggregate amount of subordinated notes of the Surviving Corporation and WCAS VIII and other equity investors have agreed to purchase approximately $350 million of common stock of the Surviving Corporation. WCAS VIII is a private investment firm and with its affiliated partnerships has been active in completing management buyouts Management buyout (MBO) Leveraged buyout whereby the acquiring group is led by the firm's management. management buyout See going private. and other private equity investments in the healthcare and information services See Information Systems. industries. The Merger is subject to certain conditions, including the approval of Centennial's shareholders, the receipt of certain approval from the Federal Communications Commission Federal Communications Commission (FCC), independent executive agency of the U.S. government established in 1934 to regulate interstate and foreign communications in the public interest. , the expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created of antitrust Antitrust The antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. They prohibit a variety of practices that restrain trade. regulatory waiting periods and the funding of the committed financing arrangements. Simultaneously with the execution of the Merger Agreement, Century Communications Corp., the holder of a majority of the voting power of Centennial, agreed to vote its shares of Centennial in favor of upon the side of; favorable to; for the advantage of. See also: favor the Merger so long as the Merger Agreement remains in effect. The Merger Agreement provides for the payment of certain fees and the reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. of certain expenses to CCW Acquisition Corp. in the event of a termination of the Merger Agreement under certain circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . Centennial Cellular Corp. acquires, operates, and invests in wireless telephone systems throughout the continental United States United States territory, including the adjacent territorial waters, located within North America between Canada and Mexico. Also called CONUS. and the Commonwealth of Puerto Rico. The Company's current wireless telephone interests represent approximately 10.1 million Net Pops. Approximately 6.5 million of these Net Pops are represented by the Company's wireless telephone systems located in the continental United States, including approximately 1.1 million Net Pops related to the Company's minority equity investments in partnerships owning wireless telephone systems. The balance of approximately 3.6 million Net Pops represents the Company's interest in its wireless telephone systems in Puerto Rico. -0-
CENTENNIAL CELLULAR CORP.
Three Months Three Months
Ended 5/31/98 Ended 5/31/97 % Change
Revenue from Wireless
Telephone Services $ 66,111,000 $ 43,746,000 51.1%
Interest Income 224,000 379,000 (40.9)%
Total Revenue 66,335,000 44,125,000 50.3%
Operating Income Before
Deprec. & Amortization 34,117,000 14,854,000 129.7%
Operating Income Before
Deprec. & Amortization
- Domestic 26,574,000 17,584,000 51.1%
Operating Income (loss) Before
Deprec. & Amortization
- Puerto Rico 7,543,000 (2,730,000) 376.3%
Operating Income (Loss) 2,560,000 (9,900,000) 125.9%
Interest Expense 11,893,000 9,781,000 21.6%
Net Loss (5,865,000) (11,581,000) (49.4)%
(a) Net Loss Per Share (.39) (.58)
Average Number Of Shares 25,801,000 26,948,000
(a) After preferred stock dividends
Year Ended Year Ended
5/31/98 5/31/97 % Change
Revenue from Wireless
Telephone Services $235,816,000 $149,212,000 58.0%
Interest Income 1,685,000 1,811,000 (7.0)%
Total Revenue 237,501,000 151,023,000 57.3%
Operating Income Before
Deprec. & Amortization 100,893,000 57,663,000 75.0%
Operating Income Before
Deprec. & Amortization
- Domestic 88,112,000 66,081,000 33.3%
Operating Income (loss) Before
Deprec. & Amortization
- Puerto Rico 12,781,000 (8,418,000) 251.8%
Operating Loss (13,301,000) (26,057,000) (49.0)%
Interest Expense 45,155,000 33,379,000 35.3%
Net Loss (31,947,000) (33,295,000) (4.0)%
(a) Net Loss Per Share (1.85) (1.83)
Average Number of Shares 26,181,000 26,934,000
(a) After preferred stock dividends
CONTACT: Century Communications Corp.
Scott Schneider, 203/972-2002
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