UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
ý QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2002
OR
o TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 0-20803
BROADWING COMMUNICATIONS INC.
Incorporated under the laws of the State of Delaware
1122 Capital of Texas Highway South, Austin, Texas 78746-6426
I.R.S. Employer Identification Number 74-2644120
Telephone - Area Code 512 328-1112
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 ý No o
All outstanding shares of the Registrant’s common stock are owned by Broadwing Inc.
The number of shares of Preferred Stock outstanding was 395,210 on July 31, 2002.
TABLE OF CONTENTS
PART I. Financial Information
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Description |
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Item 1. |
Financial Statements |
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Condensed Consolidated Balance Sheets June 30, 2002 (Unaudited) and December 31, 2001 |
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Condensed Consolidated Statements of Cash Flows (Unaudited) Six Months Ended June 30, 2002 and 2001 |
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Management’s Discussion and Analysis of Financial Condition And Results of Operations |
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PART II. Other Information |
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Description |
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Form 10-Q Part I |
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Broadwing Communications Inc. |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
($ in Millions)
(Unaudited)
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Three
Months |
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Six Months |
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2002 |
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2001 |
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2002 |
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2001 |
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(as adjusted) |
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(as adjusted) |
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Revenue |
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Service revenue |
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$ |
249.6 |
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$ |
279.8 |
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$ |
480.3 |
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$ |
545.2 |
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Product revenue |
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28.5 |
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40.8 |
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66.8 |
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73.9 |
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Total revenue |
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278.1 |
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320.6 |
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547.1 |
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619.1 |
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Costs and expenses |
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Cost of services (excluding depreciation of $60.8, $56.9, $115.7 and $111.4, included below) |
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152.1 |
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165.0 |
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291.5 |
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324.6 |
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Cost of products |
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25.0 |
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30.2 |
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57.9 |
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51.8 |
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Selling, general and administrative |
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77.3 |
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89.9 |
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154.6 |
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176.0 |
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Depreciation |
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71.8 |
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64.3 |
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143.4 |
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124.5 |
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Amortization |
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6.2 |
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28.0 |
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12.4 |
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55.6 |
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Restructuring and other charges |
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— |
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— |
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15.9 |
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— |
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Total costs and expenses |
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332.4 |
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377.4 |
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675.7 |
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732.5 |
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Operating loss |
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(54.3 |
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(56.8 |
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(128.6 |
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(113.4 |
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Equity loss in unconsolidated entities |
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— |
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0.7 |
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— |
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4.0 |
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Interest expense |
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17.6 |
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15.7 |
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32.5 |
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35.3 |
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Loss (gain) on investments, net |
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0.2 |
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3.1 |
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0.2 |
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(12.3 |
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Other expense (income), net |
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0.1 |
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(0.4 |
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(0.5 |
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(0.4 |
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Loss from continuing operations before income taxes |
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(72.2 |
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(75.9 |
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(160.8 |
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(140.0 |
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Income tax benefit |
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(25.3 |
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(20.1 |
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(56.5 |
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(36.5 |
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Net loss from continuing operations |
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(46.9 |
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(55.8 |
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(104.3 |
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(103.5 |
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Cumulative effect of change in accounting principle, net of taxes of $3.1 |
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— |
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(2,008.7 |
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Net loss |
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(46.9 |
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(55.8 |
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(2,113.0 |
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(103.5 |
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Other comprehensive income (loss), net of tax |
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Total other comprehensive income (loss) |
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— |
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— |
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— |
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— |
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Comprehensive income (loss) |
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$ |
(46.9 |
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(55.8 |
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(2,113.0 |
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$ |
(103.5 |
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The accompanying notes are an integral part of the financial statements.
1
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in Millions, Except Per Share Amounts)
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(Unaudited) |
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December
31, |
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(as adjusted) |
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Assets |
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