Cincinnati Bell Inc. Reports Strong Financial Results for the Fourth Quarter and Full Year 2004.CINCINNATI Cincinnati (sĭnsənăt`ē, –năt`ə), city (1990 pop. 364,040), seat of Hamilton co., extreme SW Ohio, on the Ohio River opposite Newport and Covington, Ky.; inc. as a city 1819. -- Exceeds Net Debt Reduction Goal, Achieves a 73 Percent Increase in "Super Bundle To sell hardware and software as a combined product or to combine several software packages for sale as a single unit. Contrast with unbundle. See bundled software and bundling. " Subscribers and a 31 Percent Increase in DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary Subscribers Cincinnati Bell Cincinnati Bell is the dominant telephone company for Cincinnati, Ohio and its nearby suburbs in Ohio, Indiana and Kentucky. The parent company is named Cincinnati Bell Inc. Inc. (NYSE NYSE See: New York Stock Exchange :CBB CBB Celebrity Big Brother CBB College van Beroep voor het Bedrijfsleven (Dutch) CBB Cattlemen's Beef Board CBB Coalition for Buzzards Bay CBB Could Be Better (visual effects) CBB Can't Be Bothered ) today announced revenue of $300 million, 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. of $63 million, and net income of $21 million, or $0.07 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, for the fourth quarter of 2004. Reported results reflect the impact of two special items recorded during the quarter: a non-cash income tax benefit of $13 million related to a change in estimated future tax benefits, and an $11 million restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. , of which $1 million was cash, related to the company's previously announced restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). plan. Excluding the restructuring charge and the tax benefit, the company generated quarterly operating income of $75 million and net income of $16 million, or $0.05 per diluted share. For the year ended December December: see month. 31, the company reported revenue of $1,207 million, operating income of $299 million and net income of $64 million, or $0.21 per diluted share. Excluding restructuring charges and tax benefits, operating income totaled $311 million and net income was $59 million, or $0.20 per diluted share. Capital expenditures were $134 million, or 11 percent of revenue, for 2004. Highlights for the Year 2004 "This year our core customers were not only well satisfied, they demonstrated increased confidence in us by expanding their commitments to our products and services," said Jack Cassidy For the bass guitarist from Jefferson Airplane, see Jack Casady. Jack Cassidy (March 5, 1927 – December 12, 1976) was an American actor, who achieved success in theater, cinema and television. , president and chief executive officer of Cincinnati Bell Inc. This success, combined with our recently announced refinancing Refinancing An extension and/or increase in amount of existing debt. plan, strengthens our cash flows and allows us to accelerate debt reduction to the benefit of our shareholders and our future competitive strength." In 2004, Cincinnati Bell: --Continued to de-lever the company, reducing net debt(a) by $149 million and exceeding its goal of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $140 million in 2004. Net debt of $2,112 million was 7 percent less than at the end of 2003. The company also produced $167 million of free cash flow(b), which was 82 percent more than in 2003 and exceeded guidance by $7 million. --Defended its core franchise through bundling bundling, courtship custom, thought to have originated in Holland and the British Isles. It was extended to America, particularly to New England, and most widely practiced in the years prior to the Revolution of 1776. , adding 52,000 net subscribers to its Custom Connections "super bundle" which offers local, long distance, wireless and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. DSL. The company finished the year with 123,000 super bundle subscribers, or 73 percent more than at the end of the prior year. Additionally, total access lines declined by 1.6 percent versus the end of 2003, a full percentage point improvement over the 2.6 percent annual decline reported in the prior year as the company saw little impact from cable telephony See cable telephone. competition. Combining access lines and DSL lines, the company added 16,000 net new total connections for the year. --Grew its business by adding 31,000 Digital Subscriber Line See DSL. (communications, protocol) Digital Subscriber Line - (DSL, or Digital Subscriber Loop, xDSL - see below) A family of digital telecommunications protocols designed to allow high speed data communication over the existing copper telephone lines between end-users and (DSL) subscribers, or 26 percent more than were added in 2003, which is within the guidance range of 30,000 to 35,000 DSL net additions. The company finished the year with 131,000 DSL subscribers, or 31 percent more than at the end of 2003. Cincinnati Bell increased its DSL penetration The successful unauthorized breach of a security perimeter. See penetration test. by 4 points, to 14 percent of total access lines at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . --Met or exceeded financial guidance for the year:
Category 2004 Guidance 2004 Actual
---------------------- ----------------------- -----------------------
Net debt reduction Approximately $140 $149 million
million
---------------------- ----------------------- -----------------------
EBITDA(c) $485 to $505 million $501 million, excluding
a $3 million non-cash
adjustment to wireless
rent expense
---------------------- ----------------------- -----------------------
Revenue decline, excl. Low single-digit 4 percent
Broadband Services
---------------------- ----------------------- -----------------------
DSL net additions 30,000 to 35,000 31,000
---------------------- ----------------------- -----------------------
Effective tax rate 50 percent, with 36 percent (including
approximately $5 non-cash tax
million in cash income benefits), with $2
tax payments million in cash income
tax payments
---------------------- ----------------------- -----------------------
Capital expenditures 10 to 12 percent of 11 percent of revenue
revenue
---------------------- ----------------------- -----------------------
Net access line Below 2 percent 1.6 percent
decline
---------------------- ----------------------- -----------------------
Wireless net additions 10,000 to 20,000 7,000
---------------------- ----------------------- -----------------------
Highlights for the Fourth Quarter 2004 "DSL adoption and service bundling continue to be success stories for Cincinnati Bell," said Cassidy Cassidy (O'Caiside in Irish) is a common Irish surname. The surname translates to 'descendent of Caiside'. The family were a sept of County Fermanagh. The Caiside's were originally a medical family, who were hereditary physicians to the Maguires. . "DSL growth continues to help offset traditional access line losses, while 78 percent of in-territory consumer DSL activations and 76 percent of in-territory consumer postpaid post·paid adj. With the postage having been paid in advance. postpaid Adverb, adj with the postage prepaid Adj. 1. wireless activations came as part of the bundle." In the fourth quarter, Cincinnati Bell: --Posted DSL net additions of 8,000, up 15 percent from the fourth quarter of 2003. --Added 10,000 net subscribers to its Custom Connections "super-bundle." Twenty percent of the company's in-territory consumer households are now super-bundle customers. This helped to increase in-territory consumer revenue per household 5 percent versus the fourth quarter of 2003, to a total of approximately $77 per month. --Improved postpaid wireless churn churn: see butter. to 2.78 percent, a 0.9 point improvement versus the third quarter of 2004. Financial Results "During 2004, Cincinnati Bell exceeded its net debt reduction goal while at the same time continuing to make the investments necessary to operating a world-class world-class adj. 1. Ranking among the foremost in the world; of an international standard of excellence; of the highest order: a world-class figure skater. 2. telecommunications company See telecom company. . We continue to generate strong cash flow for de-levering the company while remaining the pre-eminently Adv. 1. pre-eminently - to a preeminent degree; with superiority or distinction above others; in a preeminent manner; "a wide variety of pre-eminently contemporary scenes" preeminently positioned competitive force in our market," said Brian Ross
Brian Ross (born September 4, 1944 in Ballston Spa, New York) is a racecar driver. He won Rookie of the Year honors in the Auto Racing Club of America in 2000. , Cincinnati Bell Inc.'s chief financial officer. Revenue For the fourth quarter, revenue of $300 million was flat versus the fourth quarter of 2003 when excluding the impact of the sale of substantially all of the out-of-territory assets of the company's Hardware and Managed Services An umbrella term for third-party monitoring and maintaining of computers, networks and software. The actual equipment may be inhouse or at the third-party's facilities, but the "managed" implies an ongoing effort; for example, making sure the equipment is running at a certain quality segment. This sale resulted in a decrease in revenue of $11 million. For the year, excluding the Broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). segment, revenue decreased $49 million, or 4 percent, versus 2003. Of this decrease, $33 million was due primarily to the sale of substantially all of the out-of-territory assets of CBTS CBTS Computer Based Training System CBTS Computer Based Training Squadron CBTS Can't Be Too Sure , while $13 million was due to a decline in local service revenue resulting from a decrease in access lines. On a consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: basis, revenue of $1,207 million declined 23 percent, or $351 million, versus 2003, primarily due to the sale of substantially all of the company's broadband assets in 2003. Operating Income For the fourth quarter, operating income, excluding restructuring charges, was $75 million, which was 22 percent, or $14 million, higher than the fourth quarter of 2003. This increase was primarily due to an $8 million decrease in asset impairments and other charges, a $6 million decrease in depreciation, a $5 million decrease in the cost of long distance minutes in the Other segment and a $3 million decrease in operating taxes in the Local segment, partially offset by a $3 million increase in non-cash rent expense in the Wireless segment and the decline in revenue. The increase in rent expense was due to a non-cash, non-recurring adjustment to account for the terms of cell site ground leases and the amortization periods of their respective leasehold improvements Leasehold Improvement Improvements on a leased asset that increase the value of the asset. Notes: A leasehold improvement is classified as an asset that must be depreciated over time. consistently. For the year, excluding the Broadband segment, operating income decreased 15 percent, or $51 million, primarily due to a $23 million increase in wireless and DSL customer acquisition expenses, a $20 million increase in depreciation and amortization and a $5 million increase in restructuring charges. On a consolidated basis, operating income of $299 million decreased 56 percent, or $385 million, versus 2003, primarily due to a $332 million decrease in gain on the sale of substantially all of the broadband assets. Local Communications Services Cincinnati Bell's Local segment, which includes the operations of the company's local-exchange subsidiary, Cincinnati Bell Telephone (CBT (Computer-Based Training) Using the computer for training and instruction. CBT programs are called "courseware" and provide interactive training sessions for all disciplines. ), produced revenue of $191 million for the fourth quarter, down 1 percent versus the fourth quarter of 2003, as higher DSL revenue partially offset declining voice revenue. For the year, CBT recorded $762 million in revenue, a 2 percent decrease versus 2003, as higher DSL revenue partially offset lower voice and wiring revenue. In 2004, DSL revenue increased 29 percent versus the prior year, driven by a 31 percent increase in subscribers over the same period. The Local segment produced operating income, excluding restructuring charges, of $73 million for the fourth quarter, a 6 percent, or $4 million, increase versus the fourth quarter of 2003. This increase was primarily due to a $3 million decrease in operating taxes and a $4 million decrease in depreciation, partially offset by the decline in revenue. For the year, the Local segment reported operating income, excluding restructuring charges, of $290 million, up 1 percent, or $2 million, versus 2003. The increase was due primarily to a $9 million decrease in depreciation and a $7 million decrease in operating taxes, partially offset by a $5 million increase in customer acquisition expense and the decline in revenue. CBT finished the year with 970,000 total access lines, a 1.6 percent decline versus the prior year, a full percentage point improvement over the 2.6 percent decline reported in 2003. This improvement was due primarily to the addition of 21,000 out-of-territory lines in 2004, which was 18,000 more than were added in 2003. This increase in out-of-territory lines was primarily due to the launch of local service in the Dayton Dayton, city (1990 pop. 182,044), seat of Montgomery co., SW Ohio, on the Great Miami River where it is joined by the Stillwater River; inc. 1805. It is the trade center for a fertile farm area, but is best known for its involvement with industry, invention, and market, where Cincinnati Bell sells local service bundled bun·dle n. 1. A group of objects held together, as by tying or wrapping. 2. Something wrapped or tied up for carrying; a package. 3. Biology A cluster or strand of closely bound muscle or nerve fibers. with wireless and long distance service. These out-of-territory lines partially offset the decline of 37,000 in-territory lines. The decrease in in-territory lines was primarily due to wireless and broadband substitution Substitution Arsinoë put her own son in place of Orestes; her son was killed and Orestes was saved. [Gk. Myth.: Zimmerman, 32] Barabbas robber freed in Christ’s stead. [N.T.: Matthew 27:15–18; Swed. Lit. , disconnects for non-payment non-payment Noun failure to pay money owed non-payment n → Nichtzahlung f, Zahlungsverweigerung f non-payment n and, to a lesser degree, cable telephony competition. Combining the in and out-of-territory lines with the increase of 31,000 DSL subscribers, Cincinnati Bell reported a net increase of 16,000 total connections versus the end of 2003. Capital investment was $21 million for fourth quarter and $80 million, or 11 percent of revenue, for the year. Wireless Services Cincinnati Bell Wireless (CBW cbw - Crypt Breakers Workbench ) reported revenue of $64 million in the fourth quarter, up 3 percent versus the fourth quarter of 2003, as increases in equipment, data and prepaid pre·pay tr.v. pre·paid, pre·pay·ing, pre·pays To pay or pay for beforehand. pre·pay  ment n. voice revenue offset lower
postpaid voice revenue. For the year, CBW produced revenue of $262
million, up 1 percent versus 2003, for substantially the same reasons.
In 2004, CBW increased wireless data revenue 62 percent, or $6 million,
to $15 million, or 6 percent of service revenue.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. for the quarter was $9 million, an $8 million greater loss than the fourth quarter of 2003. This was due in part to the $3 million non-cash, non-recurring adjustment to rent expense described above. CBW also reported a $2 million increase in customer acquisition cost related to a 10 percent increase in gross activations, as well as a $2 million increase in depreciation, amortization and asset write-downs. For the year, the operating loss was $1 million, a $62 million decrease in operating income versus 2003. This decrease was due primarily to a $35 million increase in depreciation, amortization and asset write-offs, all related to the company's transition from TDMA (Time Division Multiple Access) A satellite and cellular phone technology that interleaves multiple digital signals onto a single high-speed channel. For cellular, TDMA triples the capacity of the original analog method (FDMA). to GSM (Global System for Mobile Communications) A digital cellular phone technology based on TDMA that is the predominant system in Europe, but also used worldwide. Developed in the 1980s, GSM was first deployed in seven European countries in 1992. technology, an $18 million increase in customer acquisition cost related to a 27 percent increase in gross activations, the $3 million non-cash adjustment to rent expense mentioned above and a $4 million increase in customer care expenses and operating taxes, with the remainder due to the decline in postpaid voice revenue. In the fourth quarter, the company posted gross activations of 70,000, a 10 percent increase versus the fourth quarter of 2003. Seventy-six percent of consumer postpaid activations in Cincinnati came as part of the bundle. Cincinnati Bell also reported net subscriber subscriber, n the person, usually the employee, who represents the family unit in relation to the prepayment plan. Other family members are dependents. Also called certificate holders or enrollees. additions of 2,000. Postpaid churn finished the quarter at 2.78 percent, which was a 0.9 point improvement versus the third quarter of 2004. The churn improvement was due primarily to improvements in network quality as the company transitions from TDMA to GSM technology. For the year, gross activations of 243,000 increased 27 percent versus 2003. Net activations of 7,000 were 3,000 higher than in 2003. For the quarter, postpaid Average Revenue Per User (ARPU (Average Revenue Per User) A calculation often used to determine the overall value of an application. It is also used to rate particular customers, especially in the wireless space, by comparing someone's account to the overall average. (d)) was $51, a 7 percent decrease, while prepaid ARPU was $19, a 12 percent increase, both versus the fourth quarter of 2003. Postpaid ARPU declined due to customer migration to lower ARPU plans as well as lower roaming The ability to use a communications device such as a cellphone or PDA and be able to move from one cell or access point to another without losing the connection. revenue. Capital investment was $10 million, or 15 percent of revenue, in the fourth quarter. For the year, capital investment was $32 million, or 12 percent of revenue. Cincinnati Bell finished the year with 481,000 subscribers, 207,000 of which were on the company's GSM network, which the company launched in the fourth quarter of 2003. Hardware and Managed Services For the fourth quarter, revenue in the Hardware and Managed Services segment of $34 million increased 3 percent versus the fourth quarter of 2003, excluding revenue associated with the out-of-territory assets of Cincinnati Bell Technology Solutions (CBTS). This increase was due primarily to strong hardware sales to enterprise customers and increased managed services revenue driven by the implementation of a data center in the third quarter of 2004. Including the revenue associated with the out-of-territory assets of CBTS, revenue declined 23 percent versus the fourth quarter of 2003. For the year, excluding revenue associated with the sale of substantially all of the out-of-territory assets of CBTS, revenue increased 5 percent, or $5 million, compared to 2003, due to strong hardware sales. Including the impact of the sold assets, revenue declined by 17 percent versus 2003. For the fourth quarter, operating income of $3 million declined $2 million from the fourth quarter of 2003 primarily due to lower margins on equipment sales and also due to the sale of the out-of-territory assets. For the year, operating income of $13 million was down $5 million versus 2003, for substantially the same reasons. The segment reported capital investment of $2 million in the quarter. The segment had capital investment of $16 million for the year, substantially all related to an investment in a data center in the third quarter of 2004. Virtually all of the data center space is currently under long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. service contracts with enterprise customers. Other Communications Services Other Communications Services, which includes Cincinnati Bell's voice long distance and public payphone payphone Noun a coin-operated telephone payphone pay n → Münztelefon nt; (card phone) → Kartentelefon nt operations, reported revenue of $20 million for the fourth quarter, 4 percent, or $1 million, higher than the same quarter a year ago. This increase was due primarily to a 10 percent, or $2 million, increase in long distance revenue, which was partially offset by a decline in payphone revenue. Long distance revenue increased due to the company's bundling efforts in and out-of-territory, while payphone revenue decreased primarily due to the sale of substantially all of the segment's out-of-territory and correctional institution Noun 1. correctional institution - a penal institution maintained by the government detention camp, detention home, detention house, house of detention - an institution where juvenile offenders can be held temporarily (usually under the supervision of a juvenile payphones in the fourth quarter of 2004. For the year, the Other segment produced revenue of $79 million, or 3 percent less than in 2003. This decrease was due primarily to a 17 percent decrease in payphone revenue as a result of the sale of payphones mentioned above. The Other segment produced $6 million in operating income for the quarter as compared to break-even performance in the fourth quarter of 2003. This improvement was primarily due to a $4 million asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. in the payphone business recorded in the fourth quarter of 2003 and not repeated in the fourth quarter of 2004, as well as a substantial decrease in the cost of long distance minutes. For the year, the Other segment reported operating income of $18 million, up $11 million from 2003, for substantially the same reasons. CBAD's Cincinnati market share of CBT access lines for which a long distance carrier is selected was 76 percent in the consumer market and 48 percent in the business market at the end of the year, improvements of 5 points and 3 points, respectively, versus the prior year. Broadband The Broadband segment produced no revenue in the quarter, due to the sale of substantially all of the company's broadband assets in 2003. There are no longer any meaningful operations in this segment. The remaining activity relates to the disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of of remaining liabilities associated with the broadband sale. At the end of 2004, the company had $24 million in such liabilities. For the year, the company eliminated $38 million of such liabilities, using $26 million in cash. The Broadband segment reported operating income of $6 million for the fourth quarter of 2004, entirely due to favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. adjustments to liabilities and reserves. 2005 Guidance The company provides the following guidance for 2005 results:
Category 2005 Guidance
----------------- ----------------------------------------------------
Revenue Low single-digit percent decline
----------------- ----------------------------------------------------
EBITDA $480 to $490 million, including approximately $20
million in incremental non-cash expense related to
post-retirement medical benefits and employee stock
options
----------------- ----------------------------------------------------
Capex Approximately 12 percent of revenue
----------------- ----------------------------------------------------
Free cash flow Approximately $145 million, including approximately
$20 million in financing fees
----------------- ----------------------------------------------------
Use of Non-GAAP Financial Measures (a) The company has presented certain information regarding net debt in the preceding discussion because the company believes net debt provides a useful measure of a company's liquidity and financial health. Net debt is defined by the company as the sum of the face amount of short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. and long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. , offset by cash and cash equivalents. A detailed reconciliation of the company's net debt to comparable GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). financial measures is given in the attached financial information. (b) The company has presented certain information regarding free cash flow in the preceding discussion because the company believes cash flow provides a useful measure of a company's operational performance, liquidity and financial health. Free cash flow is defined by the company as SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System 95 cash provided by (used in) operating, financing and investing activities, less changes in restricted cash in operating activities, issuance and repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of long-term debt in financing activities, short-term borrowings (repayments) in financing activities and proceeds from the sale of discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. and assets in investing activities. Cash flow should not be considered as an alternative to net income (loss), operating income (loss), cash flow from operating activities, or the change in cash on the balance sheet and may not be comparable with cash flow as defined by other companies. A detailed reconciliation of the company's free cash flow to comparable GAAP financial measures is given in the attached financial information. (c) The company has presented certain information regarding EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (Earnings Before Interest, Taxes, Depreciation and Amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
These non-GAAP financial measures should not be construed as being more important than comparable GAAP measures. They are presented because Cincinnati Bell Inc. management uses this information when evaluating the company's results of operations and cash flow and believes that this information provides the users of the financial statements with additional and useful comparisons of the company's current results of operations and cash flows with past and future periods. (d) The company has presented certain information regarding average revenue per user (ARPU) because the company believes ARPU provides a useful measure of the operational performance of the wireless business. ARPU is calculated by dividing service revenue by our average subscriber base for the respective period. For a given period, the average subscriber base is calculated by adding subscribers at the beginning of the period to subscribers at the end of the period and dividing the sum by two. Conference Call/Webcast Cincinnati Bell Inc. will host a conference call discussing its fourth quarter 2004 results on Tuesday Tuesday: see week. , February February: see month. 15, 2005 at 11:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy , which will be webcast on the company's website at www.cincinnatibell.com. The dial-in number for the conference call is 1-877-641-0086. International callers may dial 678-460-1867. A taped replay of the conference call will be available one hour after the conclusion of the teleconference until 5 p.m. (EST) on February 23, 2005. For U.S. callers, the replay will be available at 888-284-7564. For international callers, the replay will be available at 678-460-1866. The replay reference number is 156100. About Cincinnati Bell Inc. Cincinnati Bell Inc. (NYSE: CBB) is parent to one of the nation's most respected and best performing local exchange and wireless providers with a legacy of unparalleled customer service excellence. Cincinnati Bell provides a wide range of telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. products and services to residential and business customers in Ohio, Kentucky Kentucky, state, United States Kentucky (kəntŭk`ē, kĭn–), one of the so-called border states of the S central United States. It is bordered by West Virginia and Virginia (E); Tennessee (S); the Mississippi R. and Indiana Indiana, state, United States Indiana, midwestern state in the N central United States. It is bordered by Lake Michigan and the state of Michigan (N), Ohio (E), Kentucky, across the Ohio R. (S), and Illinois (W). . Cincinnati Bell is headquartered in Cincinnati, Ohio “Cincinnati” redirects here. For other uses, see Cincinnati (disambiguation). Cincinnati is a city in the U.S. state of Ohio and the county seat of Hamilton County. . For more information, visit www.cincinnatibell.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Note Certain of the statements and predictions contained in this release constitute forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and . In particular, any statements, projections or estimates that include or reference the words "believes," "anticipates," "plans," "intends," "expects," "will," or any similar expression fall within the safe harbor for forward-looking statements contained in the Reform Act. Actual results or outcomes may differ materially from those indicated or suggested by any such forward-looking statement for a variety of reasons, including but not limited to, Cincinnati Bell's ability to maintain its market position in communications services, including for wireless, wireline and internet services, general economic trends affecting the purchase or supply of telecommunication telecommunication Communication between parties at a distance from one another. Modern telecommunication systems—capable of transmitting telephone, fax, data, radio, or television signals—can transmit large volumes of information over long distances. services, world and national events that may affect the ability to provide services, changes in the regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. environment, any rulings, orders or decrees that may be issued by any court or arbitrator arbitrator n. one who conducts an arbitration, and serves as a judge who conducts a "mini-trial," somewhat less formally than a court trial. In most cases the arbitraror is an attorney, either alone or as part of a panel. , restrictions imposed under our various credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities and debt instruments, work stoppages caused by labor disputes, adjustments resulting from year-end audit procedures and Cincinnati Bell's ability to develop and launch new products and services. More information on potential risks and uncertainties is available in the company's recent filings with the Securities and Exchange Commission, including Cincinnati Bell's annual Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. report, quarterly Form 10-Q Form 10-Q See 10-Q. reports and Forms 8-K. The forward-looking statements included in this release represent the company's estimates as of February 15, 2005. The company anticipates that subsequent events and developments will cause its estimates to change.
Cincinnati Bell Inc.
Consolidated Statements of Income
(Unaudited)
(in millions - except per share amounts)
For the For the
Three Months Twelve Months
Ended Ended
December 31, % December 31, %
2004 2003 Change 2004 2003 Change
------- ------- --------------- --------- ------
Revenue $299.8 $311.2 (4%) $1,207.1 $1,557.8 (23%)
---------------------
Costs & Expenses
---------------------
Cost of Services and
Products 120.0 130.3 (8%) 481.4 681.5 (29%)
Selling, General &
Administrative 62.0 62.2 (0%) 227.6 353.1 (36%)
Depreciation and
Amortization 45.0 48.7 (8%) 187.7 169.7 11%
Restructuring 11.4 0.8 n/m 11.6 (2.6) n/m
Asset Impairments and
Other Charges 1.7 9.5 (82%) 3.2 8.8 (64%)
Gain on Sale of
Broadband Assets (3.7) (0.4) n/m (3.7) (336.7) (99%)
------- ------- --------- ---------
Operating Income 63.4 60.1 5% 299.3 684.0 (56%)
Minority Interest
Expense (Income) (2.0) (0.3) n/m (0.5) 42.2 (101%)
Other Income, Net (3.2) (26.4) (88%) (3.8) (9.6) -
Interest Expense and
Other Financing
Costs 51.3 60.4 (15%) 203.3 234.2 (13%)
------- ------- --------- ---------
Income before Income Taxes
and Cumulative Effect of
Change in Accounting
Principle 17.3 26.4 - 100.3 417.2 (76%)
Income Tax Expense
(Benefit) (3.6) (816.6) n/m 36.1 (828.8) (104%)
------- ------- --------- ---------
Income before
Cumulative Effect of
Change in Accounting
Principle 20.9 843.0 (98%) 64.2 1,246.0 (95%)
Cumulative Effect of
Change in Accounting
Principle, Net of
Taxes -- -- n/m -- 85.9 n/m
------- ------- --------- ---------
Net Income 20.9 843.0 (98%) 64.2 1,331.9 (95%)
Preferred Stock
Dividends 2.6 2.6 - 10.4 10.4 -
------- ------- --------- ---------
Net Income Applicable
to Common
Shareowners $18.3 $840.4 (98%) $53.8 $1,321.5 (96%)
======= ======= ========= =========
Basic Earnings Per
Common Share
---------------------
Income before
Cumulative Effect of
Change in Accounting
Principle $0.07 $3.44 $0.22 $5.44
Cumulative Effect of
Change in Accounting
Principle, Net of
Taxes -- -- -- 0.38
------- ------- --------- ---------
Net Earnings Per
Common Share $0.07 $3.44 $0.22 $5.82
======= ======= ========= =========
Diluted Earnings Per
Common Share
---------------------
Income before
Cumulative Effect of
Change in Accounting
Principle $0.07 $3.17 $0.21 $5.02
Cumulative Effect of
Change in Accounting
Principle, Net of
Taxes -- -- -- 0.34
------- ------- --------- ---------
Net Earnings Per
Common Share $0.07 $3.17 $0.21 $5.36
======= ======= ========= =========
Weighted Average
Common Shares
Outstanding
---------------------
- Basic 245.2 244.3 245.1 226.9
- Diluted 248.6 267.6 250.5 253.3
Cincinnati Bell Inc.
Segment Information
(Unaudited)
(dollars in millions) For the For the
Three Months Twelve Months
Ended Ended
December 31, % December 31, %
2004 2003 Change 2004 2003 Change
------- ------- -------------- ------- ------
Local
Revenue
Voice $128.3 $132.6 (3%) $519.8 $536.6 (3%)
Data 52.2 49.6 5% 203.9 196.3 4%
Other services 10.3 9.5 8% 38.0 41.6 (9%)
------- ------- ------- -------
Total revenue 190.8 191.7 (0%) 761.7 774.5 (2%)
Operating Costs and
Expenses:
Cost of services and
products 54.8 57.0 (4%) 220.2 232.2 (5%)
Selling, general and
administrative 34.9 33.3 5% 134.8 128.8 5%
Depreciation 27.6 31.8 (13%) 117.2 125.7 (7%)
Restructuring 10.2 4.5 127% 10.4 4.5 131%
Asset impairments and
other charges -- 0.3 n/m -- 0.6 n/m
------- ------- ------- -------
Total operating costs
and expenses 127.5 126.9 0% 482.6 491.8 (2%)
------- ------- ------- -------
Operating income $63.3 $64.8 (2%) $279.1 $282.7 (1%)
======= ======= ======= =======
Wireless
Revenue
Service $57.2 $58.7 -- $242.0 $246.4 (2%)
Equipment 7.1 3.9 82% 19.7 13.1 50%
------- ------- ------- -------
Total revenue 64.3 62.6 3% 261.7 259.5 --
Operating Costs and
Expenses:
Cost of services and
products 37.5 32.4 16% 133.2 110.5 21%
Selling, general and
administrative 17.7 15.1 17% 56.5 50.0 13%
Depreciation 14.4 15.8 (9%) 58.3 38.3 52%
Amortization 2.0 0.1 n/m 9.1 0.5 n/m
Restructuring 0.1 0.1 -- 0.1 - n/m
Asset impairments and
other charges 1.8 - n/m 5.9 - n/m
------- ------- ------- -------
Total operating costs
and expenses 73.5 63.5 16% 263.1 199.3 32%
------- ------- ------- -------
Operating income $(9.2) $(0.9) n/m $(1.4) $60.2 n/m
======= ======= ======= =======
Hardware & Mgd.
Services
Revenue
Hardware $17.1 $25.1 (32%) $74.0 $89.6 (17%)
Managed services 16.6 18.4 (10%) 60.7 73.2 (17%)
------- ------- ------- -------
Total revenue 33.7 43.5 (23%) $134.7 162.8 (17%)
Operating Costs and
Expenses:
Cost of services and
products 25.5 32.1 (21%) 104.7 121.4 (14%)
Selling, general and
administrative 4.4 6.7 (34%) 16.7 24.3 (31%)
Depreciation 0.5 0.2 150% 1.1 0.7 57%
Restructuring 0.6 - n/m 0.6 - n/m
Asset impairments and
other charges - - -- (1.1) - n/m
Gain on sale of
assets - 0.1 n/m - (1.1) n/m
------- ------- ------- -------
Total operating costs
and expenses 31.0 39.1 (21%) 122.0 145.3 (16%)
------- ------- ------- -------
Operating income $2.7 $4.4 (39%) $12.7 $17.5 (27%)
======= ======= ======= =======
Other
Revenue $20.0 $19.4 -- $78.6 $81.1 (3%)
Costs and Expenses:
Cost of services and
products 9.1 12.9 (29%) 44.5 54.1 (18%)
Selling, general and
administrative 4.2 2.6 62% 14.3 14.8 (3%)
Depreciation and
amortization 0.5 0.6 (17%) 1.7 2.1 (19%)
Restructuring 0.2 -- n/m 0.2 -- n/m
Asset impairments and
other charges (0.1) 3.5 n/m (0.1) 3.6 n/m
------- ------- ------- -------
Total costs and
expenses 13.9 19.6 (29%) 60.6 74.6 (19%)
------- ------- ------- -------
Operating income $6.1 $(0.2) n/m $18.0 $6.5 n/m
======= ======= ======= =======
Broadband
Revenue
Broadband transport - - -- - 159.3 n/m
Switched voice
services - - -- - 111.9 n/m
Data and Internet - - -- - 59.5 n/m
Other services - - -- - 1.7 n/m
------- ------- ------- -------
Total revenue - - -- - 332.4 n/m
Costs and Expenses:
Cost of services and
products - - -- - 202.8 n/m
Selling, general and
administrative (1.0) 1.8 n/m (3.7) 125.2 (103%)
Depreciation - - -- - 1.9 n/m
Restructuring (1.8) (7.8) (77%) (1.8) (11.1) (84%)
Asset impairments and
other charges 0.1 5.7 (98%) (1.5) 5.8 n/m
Gain on sale of
broadband assets (3.7) (0.4) n/m (3.7) (336.7) (99%)
------- ------- ------- -------
Total costs and
expenses (6.4) (0.7) n/m (10.7) (12.1) (12%)
------- ------- ------- -------
Operating income $6.4 $0.7 n/m $10.7 $344.5 (97%)
======= ======= ======= =======
Cincinnati Bell Inc.
Segment Information
(Unaudited)
(dollars in For the For the
millions) Three Months Twelve Months
Ended Ended
December 31, % December 31, %
2004 2003 Change 2004 2003 Change
------- ------- ---------------- --------- ------
Revenue
--------------------
Local $190.8 $191.7 (0%) $761.7 $774.5 (2%)
Wireless 64.3 62.6 3% 261.7 259.5 --
Hardware & Mgd.
Services 33.7 43.5 (23%) 134.7 162.8 (17%)
Other 20.0 19.4 3% 78.6 81.1 (3%)
Broadband -- -- -- -- 332.4 n/m
Corporate and
eliminations (9.0) (6.0) 50% (29.6) (52.5) (44%)
------- ------- --------- ---------
Total Revenue $299.8 $311.2 (4%) $1,207.1 $1,557.8 (23%)
======= ======= ========= =========
Cost of Services and
Products
--------------------
Local $54.8 $57.0 (4%) $220.2 $232.2 (5%)
Wireless 37.5 32.4 16% 133.2 110.5 21%
Hardware & Mgd.
Services 25.5 32.1 (21%) 104.7 121.4 (14%)
Other 9.1 12.9 (29%) 44.5 54.1 (18%)
Broadband -- -- -- -- 202.8 n/m
Corporate and
eliminations (6.9) (4.1) 68% (21.2) (39.5) (46%)
------- ------- --------- ---------
Total Cost of
Services and
Products $120.0 $130.3 (8%) $481.4 $681.5 (29%)
======= ======= ========= =========
Selling, General &
Administrative
--------------------
Local $34.9 $33.3 5% $134.8 $128.8 5%
Wireless 17.7 15.1 17% 56.5 50.0 13%
Hardware & Mgd.
Services 4.4 6.7 (34%) 16.7 24.3 (31%)
Other 4.2 2.6 62% 14.3 14.8 (3%)
Broadband (1.0) 1.8 n/m (3.7) 125.2 n/m
Corporate and
eliminations 1.8 2.7 (33%) 9.0 10.0 (10%)
------- ------- --------- ---------
Total Selling,
General &
Administrative $62.0 $62.2 (0%) $227.6 $353.1 (36%)
======= ======= ========= =========
Depreciation and
Amortization
--------------------
Local $27.6 $31.8 (13%) $117.2 $125.7 (7%)
Wireless 16.4 15.9 3% 67.4 38.8 74%
Hardware & Mgd.
Services 0.5 0.2 150% 1.1 0.7 57%
Other 0.5 0.6 (17%) 1.7 2.1 (19%)
Broadband -- -- -- -- 1.9 n/m
Corporate and
eliminations -- 0.2 n/m 0.3 0.5 (40%)
------- ------- --------- ---------
Total Depreciation
and Amortization $45.0 $48.7 (8%) $187.7 $169.7 11%
======= ======= ========= =========
Restructuring
--------------------
Local $10.2 $4.5 127% $10.4 $4.5 131%
Wireless 0.1 0.1 -- 0.1 - n/m
Hardware & Mgd.
Services 0.6 - n/m 0.6 - n/m
Other 0.2 - n/m 0.2 - n/m
Broadband (1.8) (7.8) (77%) (1.8) (11.1) (84%)
Corporate and
eliminations 2.1 4.0 (48%) 2.1 4.0 (48%)
------- ------- --------- ---------
Total Restructuring $11.4 $0.8 n/m $11.6 $(2.6) n/m
======= ======= ========= =========
Asset Impairments and Other
Charges (Credits)
---------------------------
Local $- $0.3 n/m $- $0.6 n/m
Wireless 1.8 - n/m 5.9 - n/m
Hardware & Mgd.
Services - - -- (1.1) (1.1) --
Other (0.1) 3.5 (103%) (0.1) 3.6 n/m
Broadband (3.6) 5.3 n/m (5.2) (330.9) (98%)
Corporate and
eliminations (0.1) - n/m - - --
------- ------- --------- ---------
Total Asset
Impairments and
Other Charges
(Credits) $(2.0) $9.1 (122%) $(0.5) $(327.8) (100%)
======= ======= ========= =========
Operating Income
--------------------
Local $63.3 $64.8 (2%) $279.1 $282.7 (1%)
Wireless (9.2) (0.9) n/m (1.4) 60.2 n/m
Hardware & Mgd.
Services 2.7 4.4 (39%) 12.7 17.5 (27%)
Other 6.1 (0.2) n/m 18.0 6.5 n/m
Broadband 6.4 0.7 n/m 10.7 344.5 (97%)
Corporate and
eliminations (5.9) (8.7) (32%) (19.8) (27.4) (28%)
------- ------- --------- ---------
Total Operating
Income $63.4 $60.1 5% $299.3 $684.0 (56%)
======= ======= ========= =========
Cincinnati Bell Inc.
Consolidated Balance Sheets
(Unaudited)
(in millions - except debt covenants and
segment metric information)
December 31, December 31,
2004 2003
------------ ------------
Assets
-------------------------------------------
Cash and Cash Equivalents $24.9 $26.0
Receivables - Net 139.0 140.5
Materials and Supplies 29.3 33.6
Other Current Assets 66.6 59.3
Property, Plant and Equipment - Net 851.1 898.8
Goodwill 40.9 40.9
Other Intangible Assets - Net 35.8 47.2
Noncurrent Deferred Tax Assets 654.6 696.9
Other Noncurrent Assets 119.2 130.3
------------ ------------
Total Assets $1,961.4 $2,073.5
============ ============
Liabilities and Shareowners' Deficit
-------------------------------------------
Current Portion of Long-Term Debt $30.1 $13.3
Current Portion of Unearned Revenue and
Customer Deposits 42.5 41.5
Accounts Payable 58.9 64.5
Accrued Taxes 45.4 43.7
Other Current Liabilities 120.5 132.3
Long-Term Debt, Less Current Portion 2,111.1 2,274.5
Unearned Revenue, Less Current Portion 8.9 11.9
Other Noncurrent Liabilities 126.3 131.5
Minority Interest 39.2 39.7
Shareowners' Deficit (621.5) (679.4)
------------ ------------
Total Liabilities and Shareowners'
Deficit $1,961.4 $2,073.5
============ ============
Other Data:
-------------------------------------------
Common Shares Outstanding at Balance Sheet
Date 245.5 244.6
Net Debt $2,112.4 $2,261.8
Credit Facility Availability $377.7 $299.5
Debt Covenants:
-------------------------------------------
Debt to EBITDA Ratio - Calculated 4.77 4.70
Debt to EBITDA Ratio - Required 5.75 6.20
Senior Secured Debt to EBITDA Ratio -
Calculated 1.64 1.87
Senior Secured Debt to EBITDA Ratio -
Required 3.50 4.00
Interest Coverage Ratio - Calculated 2.62 3.56
Interest Coverage Ratio - Required 2.18 2.50
Year-to-date Capital Expenditures -
Restricted Group Actual 118.4 122.2
Maximum Annual Capital Expenditures -
Restricted Group Allowed 137.8 146.0
Segment Metric Information (in thousands):
-------------------------------------------
Local Access Lines 970.1 985.8
Complete Connections Subscribers 336.4 312.5
DSL Subscribers 130.8 99.5
Custom Connections Subscribers 123.4 71.4
GSM:
Postpaid Wireless Subscribers 119.3 8.3
Prepaid Wireless Subscribers 87.5 -
TDMA:
Postpaid Wireless Subscribers 187.0 303.6
Prepaid Wireless Subscribers 87.2 162.5
------------ ------------
Total Wireless Subscribers 481.0 474.4
============ ============
Consumer Long Distance Lines 423.5 414.4
Business Long Distance Lines 138.1 124.6
------------ ------------
Total Long Distance Lines 561.6 539.0
============ ============
Cincinnati Bell Telephone
Three Year Access Line Detail
(Unaudited)
(in thousands)
--------------------------------
2002
--------------------------------
1Q 2Q 3Q 4Q
--------------------------------
Access Lines
------------------------------------
In-Territory:
Primary Residential 631.2 628.1 624.7 624.3
Secondary Residential 71.7 69.8 68.0 66.6
Business/Other 322.2 319.5 315.9 314.5
--------------------------------
Total In-Territory 1,025.1 1,017.4 1,008.6 1,005.4
Out-of-Territory:
Primary Residential 0.4 0.8 1.5 1.9
Secondary Residential - 0.1 0.1 0.1
Business/Other 2.9 3.2 3.7 4.5
--------------------------------
Total Out-of-Territory 3.3 4.1 5.3 6.5
--------------------------------
Total Access Lines 1,028.4 1,021.5 1,013.9 1,011.9
================================
Cincinnati Bell Telephone
Three Year Access Line Detail
(Unaudited)
(in thousands)
--------------------------------
2003
--------------------------------
1Q 2Q 3Q 4Q
--------------------------------
Access Lines
------------------------------------
In-Territory:
Primary Residential 624.6 620.3 617.7 613.9
Secondary Residential 64.3 62.2 60.0 58.1
Business/Other 313.2 310.2 308.0 304.6
--------------------------------
Total In-Territory 1,002.1 992.7 985.7 976.6
Out-of-Territory:
Primary Residential 2.3 2.7 3.1 3.4
Secondary Residential 0.1 0.1 0.2 0.2
Business/Other 4.7 5.0 5.2 5.6
--------------------------------
Total Out-of-Territory 7.1 7.8 8.5 9.2
--------------------------------
Total Access Lines 1,009.2 1,000.5 994.2 985.8
================================
Cincinnati Bell Telephone
Three Year Access Line Detail
(Unaudited)
(in thousands)
---------------------------------
2004
---------------------------------
1Q 2Q 3Q 4Q
---------------------------------
Access Lines
------------------------------------
In-Territory:
Primary Residential 611.8 606.3 601.5 592.7
Secondary Residential 56.0 54.0 52.2 50.5
Business/Other 301.5 299.6 298.4 296.6
---------------------------------
Total In-Territory 969.3 959.9 952.1 939.8
Out-of-Territory:
Primary Residential 4.6 10.9 15.8 18.4
Secondary Residential 0.2 0.6 0.7 0.8
Business/Other 6.8 8.0 9.9 11.1
---------------------------------
Total Out-of-Territory 11.6 19.5 26.4 30.3
---------------------------------
Total Access Lines 980.9 979.4 978.5 970.1
=================================
Cincinnati Bell Inc.
Consolidated Revenue and Operating Income Excluding Broadband
(Unaudited)
(dollars in For the For the
millions) Three Months Twelve Months
Ended Ended
December 31, % December 31, %
2004 2003 Change 2004 2003 Change
------- ------- --------------- --------- ------
Reconciliation of Consolidated Revenue to
Consolidated Revenue Excluding Broadband
Revenue $299.8 $311.2 (4%) $1,207.1 $1,557.8 (23%)
Less adjustments:
Broadband Revenue - - n/m - 332.4 n/m
Broadband
Intercompany
Activity - - n/m - (30.3) n/m
------- ------- --------- ---------
Consolidated Revenue
Excluding Broadband $299.8 $311.2 (4%) $1,207.1 $1,255.7 (4%)
======= ======= ========= =========
Reconciliation of Consolidated Operating Income to
Consolidated Operating Income Excluding Broadband
Operating Income $63.4 $60.1 5% $299.3 $684.0 (56%)
Less adjustments:
Broadband Operating
Income 6.4 0.7 n/m 10.7 344.5 (97%)
------- ------- --------- ---------
Consolidated
Operating Income
Excluding Broadband $57.0 $59.4 (4%) $288.6 $339.5 (15%)
======= ======= ========= =========
Cincinnati Bell Inc.
Net Debt Calculation
(Unaudited)
December 31, December 31, Change
-------------
(dollars in millions) 2004 2003 $ %
------------ ------------ -------------
Credit Facilities $438.9 $608.4 $(169.5)(28%)
Cincinnati Bell Telephone
notes 250.0 250.0 - -
7 1/4% Senior notes due 2013
of Cincinnati Bell Inc. 500.0 500.0 - -
16% Senior subordinated notes
of Cincinnati Bell Inc. 375.2 360.6 14.6 4%
7 1/4% Senior notes due 2023
of Cincinnati Bell Inc. 50.0 50.0 - -
8 3/8% Senior notes due 2014
of Cincinnati Bell Inc. 543.9 540.0 3.9 1%
Capital leases 15.5 18.2 (2.7)(15%)
Other short-term debt 1.6 2.7 (1.1)(41%)
Unamortized discount (33.9) (42.1) 8.2 (19%)
------------ ------------ --------
Total Debt 2,141.2 2,287.8 (146.6) (6%)
Add: Interest Rate Swap
Liability on 8 3/8% Notes due
2014 (3.9) - (3.9) -
Less: Cash and Cash
Equivalents (24.9) (26.0) 1.1 (4%)
------------ ------------ --------
Net Debt (as defined by
the company) $2,112.4 $2,261.8 $(149.4) (7%)
============ ============ ========
Cincinnati Bell Inc.
Consolidated Statements of Cash Flows
(Unaudited)
(dollars in millions) For the For the
Three Months Twelve Months
Ended Ended
December 31, December 31,
Consolidated Cash Flow 2004 2003 2004 2003
------ ------- ------- ---------
Cash provided by operating
activities $84.4 $79.9 $300.7 $310.6
------ ------- ------- ---------
Capital expenditures (33.9) (31.6) (133.9) (126.4)
Proceeds from sale of assets 1.4 - 3.3 82.7
Other 3.1 (0.1) 6.3 0.9
------ ------- ------- ---------
Cash used in investing activities (29.4) (31.7) (124.3) (42.8)
------ ------- ------- ---------
Issuance of long-term debt - 540.0 - 1,390.0
Repayment of long-term debt (70.1) (576.2) (189.5) (1,585.1)
Short-term borrowings (repayments),
net 19.2 (1.7) 17.7 (5.5)
Debt issuance costs - (15.2) - (80.4)
Issuance of common shares - exercise
of stock options 0.5 0.7 2.4 2.2
Preferred stock dividends paid (2.6) (2.6) (10.4) (7.9)
Other - - 2.3 -
------ ------- ------- ---------
Cash used in financing activities (53.0) (55.0) (177.5) (286.7)
------ ------- ------- ---------
-
Net increase in cash and cash
equivalents 2.0 (6.8) (1.1) (18.9)
Cash and cash equivalents at
beginning of period 22.9 32.8 26.0 44.9
------ ------- ------- ---------
Cash and cash equivalents at end of
period $24.9 $26.0 $24.9 $26.0
====== ======= ======= =========
Reconciliation of GAAP Cash Flow to
Cash Flow as defined by the company
Net increase in cash and cash
equivalents $2.0 $(6.8) $(1.1) $(18.9)
Less adjustments:
Issuance of long-term debt
(financing activities) - 540.0 - 1,390.0
Repayment of long-term debt
(financing activities) (70.1) (576.2) (189.5) (1,585.1)
Short-term borrowings (repayments),
net (financing activities) 19.2 (1.7) 17.7 (5.5)
Restricted Cash - - - 6.9
Proceeds from sale of assets
(investing activities) 1.4 - 3.3 82.7
------ ------- ------- ---------
Cash flow (as defined by the
company) $51.5 $31.1 $167.4 $92.1
====== ======= ======= =========
Cash Expenditures for Restructuring $(1.6) $(9.0) $(4.5) $(21.3)
Income Tax Refunds / (Payments) $(0.4) $- $(2.3) $0.3
Reconciliation of EBITDA to Operating Income (GAAP)
For the For the
Three Months Twelve Months
Ended December 31, Ended December 31,
2004 2003
--------------------------------------
Operating Income (GAAP) $63.4 $299.3
Add:
Depreciation and
Amortization 45.0 187.7
Restructuring 11.4 11.6
Gain on Sale of Assets (3.7) (3.7)
Asset Impairments & Other 1.7 3.2
--------------------------------------
54.4 198.8
--------------------------------------
EBITDA (Non-GAAP) $117.8 $498.1
======================================
|
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion