MONROE, La.--(BUSINESS WIRE)--Jan. 29, 2004--CenturyTel, Inc.
(NYSE:CTL) announces operating results for fourth quarter 2003.
-- Revenues, excluding nonrecurring items, increased 3.2% to
$604.8 million from $585.9 million, while GAAP revenues
increased 3.5% to $606.3 million from $585.9 million.
-- Operating cash flow (as defined in the attached financial
schedules), excluding nonrecurring items, rose 0.8% to $311.4
million.
-- Net income, excluding nonrecurring items, grew 4.9% to $89.3
million. Reported under GAAP, net income was $82.4 million.
-- Diluted earnings per share, excluding nonrecurring items,
increased 3.4% to $.61, while GAAP diluted earnings per share
was $.57 in fourth quarter 2003.
-- Free cash flow (as defined in the attached financial
schedules), excluding nonrecurring items, was $86.8 million in
fourth quarter 2003.
----------------------------------------------------------------------
Fourth Quarter Highlights (1) Quarter Quarter
(In thousands, except per share Ended Ended
and customer amounts) 12/31/03 12/31/02 % Change
----------------------------------------------------------------------
Revenues $ 604,815 $ 585,879 3.2%
Operating Cash Flow $ 311,442 $ 308,920 0.8%
Net Income $ 89,267 $ 85,074 4.9%
Diluted Earnings Per Share $ .61 $ .59 3.4%
Average Diluted Shares Outstanding 145,354 143,380 1.4%
Telephone Revenues $ 522,691 $ 519,427 0.6%
Other Operations Revenues $ 82,124 $ 66,452 23.6%
----------------------------------------------- ------------ ---------
Telephone Access Lines 2,376,118 2,414,564 (1.6)%
Long Distance Customers 769,766 648,797 18.6%
----------------------------------------------- ------------ ---------
(1) These results include adjustments for nonrecurring items and other
non-GAAP financial measures. A reconciliation of these items to
comparable GAAP measures is included in the attached financial
schedules.
"During 2003, CenturyTel achieved revenue and earnings growth in a
very challenging industry environment," Glen F. Post, III, chairman
and chief executive officer, said. "Record cash flows generated in
2003 provided the financial liquidity for CenturyTel to reduce debt by
more than $467 million and strengthen our cash position by nearly $200
million."
Consolidated revenues for the fourth quarter, excluding
nonrecurring items, rose 3.2% to $604.8 million from $585.9 million.
Operating cash flow, excluding nonrecurring items, grew to $311.4
million from $308.9 million. The Company achieved a consolidated cash
flow margin, excluding nonrecurring items, of 51.5% for fourth quarter
2003. Net income for the quarter, excluding nonrecurring items,
increased 4.9% to $89.3 million from $85.1 million in fourth quarter
2002. Diluted earnings per share, excluding nonrecurring items,
increased 3.4% to $.61 from $.59.
Telephone revenues for the fourth quarter, excluding nonrecurring
items, reached $522.7 million compared to $519.4 million in fourth
quarter 2002. Growth in enhanced calling features and intrastate
access revenues was partially offset by declines in intrastate toll
usage and access lines. Telephone operating income, excluding
nonrecurring items, was $175.5 million while telephone operating cash
flow, excluding nonrecurring items, was $289.1 million. Excluding
nonrecurring items, CenturyTel's fourth quarter 2003 telephone
operating cash flow margin was 55.3% while the operating income margin
was 33.6%.
Other operations revenues grew 23.6% to $82.1 million during
fourth quarter 2003, compared with $66.5 million in fourth quarter
2002. CenturyTel's long distance revenues increased 5.5% to $42.9
million. Internet revenues increased 31.6% to $21.6 million in fourth
quarter 2003 from $16.4 million in fourth quarter 2002. CenturyTel now
serves nearly 770,000 long distance customers and more than 83,000 DSL
customers, adding more than 24,500 and 7,100 customers, respectively,
during the quarter. Fiber transport revenues increased $7.4 million,
primarily due to the June 2003 acquisition of fiber assets from
Digital Teleport, Inc.
For the year 2003, results from continuing operations benefited
from the Alabama and Missouri wireline properties acquired from
Verizon in third quarter 2002. Revenues from continuing operations,
excluding nonrecurring items, increased to $2.379 billion from $1.980
billion for the same period in 2002, a 20.2% increase. Operating cash
flow from continuing operations, excluding nonrecurring items, was
$1.222 billion for 2003 compared to $1.012 billion a year ago, a 20.8%
increase. Income from continuing operations, excluding nonrecurring
items, increased 39.1% to $345.8 million from $248.5 million in 2002.
"Customer demand for long distance and Internet services continued
to drive solid revenue growth of nearly $49 million in 2003 as long
distance customers grew nearly 19% and DSL customers grew more than
58%. We believe the development of our integrated bundle during 2004
will stimulate further demand for services," Post said.
Under generally accepted accounting principles (GAAP), the
Company's fourth quarter 2003 net income was $82.4 million compared to
$44.3 million in 2002, while diluted earnings per share was $.57 for
fourth quarter 2003 compared to $.31 in fourth quarter 2002. Net
income in fourth quarter 2003 reflects an $8.8 million after-tax
charge associated with various operating tax audits and an after-tax
benefit of $2.0 million related to professional fees previously
accrued. Net income in fourth quarter 2002 included a $39.0 million
after-tax charge associated with the redemption of $400 million Series
I remarketable senior notes. See the accompanying financial
information for additional nonrecurring items that affected the fourth
quarters and full years of 2003 and 2002.
For the year 2003, prepared in accordance with GAAP, the Company
reported net income of $344.7 million, or $2.38 per diluted share,
compared to net income of $801.6 million, or $5.61 per diluted share
for the year 2002. The 2002 results included a $551.4 million
after-tax gain, or $3.86 per diluted share, from the sale of the
Company's wireless operations in third quarter 2002.
Guidance for 2004. CenturyTel anticipates a decline in 2004
telephone revenues primarily due to lower intrastate toll usage, lower
cost study adjustments, lower universal service funding and access
line declines. Giving effect to these revenue declines, the
incremental amortization expense, conversion and operating costs
related to the new billing and customer care system, and an expected
increase in the Company's effective income tax rate to 38.5% primarily
due to state income taxes, CenturyTel expects full year 2004 diluted
earnings per share to be in the range of $2.05 to $2.20.
For first quarter 2004, CenturyTel expects total revenues of $585
to $600 million and diluted earnings per share of $.49 to $.53.
These outlook figures are presented on a GAAP basis, excluding
nonrecurring items and the potential impact of any future mergers,
acquisitions, divestitures or other similar business transactions.
Reconciliation to GAAP. This release includes certain non-GAAP
financial measures, including but not limited to operating cash flow,
free cash flow and adjustments to GAAP measures to exclude the effect
of nonrecurring items. In addition to providing key metrics for
management to evaluate the Company's performance, we believe these
measurements assist investors in their understanding of
period-to-period operating performance and in identifying historical
and prospective trends. Reconciliations of non-GAAP financial measures
to the most comparable GAAP measures are included in the attached
financial schedules. Reconciliation of additional non-GAAP financial
measures that may be discussed during the earnings call described
below will be available on the Company's Web site at
www.centurytel.com. Investors are urged to consider these non-GAAP
measures in addition to, and not in substitution for, measures
prepared in accordance with GAAP.
In addition to historical information, this release includes
certain forward-looking statements, estimates and projections that are
based on current expectations only, and are subject to a number of
risks, uncertainties and assumptions, many of which are beyond the
control of the Company. Actual events and results may differ
materially from those anticipated, estimated or projected if one or
more of these risks or uncertainties materialize, or if underlying
assumptions prove incorrect. Factors that could affect actual results
include but are not limited to: the timing, success and overall
effects of competition from a wide variety of competitive providers;
the risks inherent in rapid technological change; the effects of
ongoing changes in the regulation of the communications industry; the
Company's ability to effectively manage its growth, including
integrating newly-acquired businesses into the Company's operations,
hiring adequate numbers of qualified staff, and successfully upgrading
its billing and other information systems; possible changes in the
demand for, or pricing of, the Company's products and services; the
Company's ability to successfully introduce new product or service
offerings on a timely and cost-effective basis; the Company's ability
to collect its receivables from financially troubled communications
companies; other risks referenced from time to time in the Company's
filings with the Securities and Exchange Commission; and the effects
of more general factors such as changes in interest rates, in
accounting policies or practices, in operating, medical or
administrative costs, in general market, labor or economic conditions,
or in legislation, regulation or public policy. These and other
uncertainties related to the Company's business are described in
greater detail in the Company's Annual Report on Form 10-K for the
year ended December 31, 2002. You are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of
the date of this release. The information contained in this release is
as of January 29, 2004. The Company undertakes no obligation to update
any of its forward-looking statements.
CenturyTel's management will host a conference call at 11:00 A.M.
Central time today. Interested parties can access the call by dialing
800.346.2923 and the call will be accessible for replay until 1:00
p.m. CST, February 5, 2004, by calling 800.332.6854 and entering the
conference-id number: 3383. Investors can also listen to CenturyTel's
earnings conference call and replay by accessing the Company's Web
site at www.centurytel.com
CenturyTel, Inc.
provides communications services including local,
long distance, Internet access and data services to more than 3
million customers in 22 states. The company, headquartered in Monroe,
Louisiana, is publicly traded on the New York Stock Exchange under the
symbol CTL, and is included in the S&P 500 Index. CenturyTel is the
8th largest local exchange telephone company, based on access lines,
in the United States. Visit CenturyTel at www.centurytel.com.
CenturyTel, Inc.
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002
(UNAUDITED)
Three months ended December
31, 2003
-----------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
In thousands, except per share amounts reported items items
--------- --------- ---------
TELEPHONE OPERATIONS
Operating revenues
Local service $ 188,464 - 188,464
Network access 289,224 1,500 (1) 287,724
Other 46,503 - 46,503
--------- --------- ---------
524,191 1,500 522,691
--------- --------- ---------
Operating expenses
Plant operations 127,199 - 127,199
Customer operations 43,526 - 43,526
Corporate and other 70,351 7,500 (1) 62,851
Depreciation and amortization 113,601 - 113,601
--------- --------- ---------
354,677 7,500 347,177
--------- --------- ---------
Telephone operating income 169,514 (6,000) 175,514
--------- --------- ---------
OTHER OPERATIONS
Operating revenues
Long distance 42,916 - 42,916
Internet 21,588 - 21,588
Other 17,620 - 17,620
--------- --------- ---------
82,124 - 82,124
--------- --------- ---------
Operating expenses
Cost of sales and other 59,797 - 59,797
Depreciation and amortization 5,380 - 5,380
--------- --------- ---------
65,177 - 65,177
--------- --------- ---------
Other operating income 16,947 - 16,947
--------- --------- ---------
TOTAL OPERATING INCOME 186,461 (6,000) 192,461
OTHER INCOME (EXPENSE)
Interest expense (60,842)(7,500)(1) (53,342)
Income from unconsolidated cellular
entity 1,265 - 1,265
Other income and expense 3,188 3,000 (2) 188
Income tax expense (47,630) 3,675 (3) (51,305)
--------- --------- ---------
NET INCOME $ 82,442 (6,825) 89,267
========= ========= =========
BASIC EARNINGS PER SHARE $ 0.57 (0.05) 0.62
DILUTED EARNINGS PER SHARE $ 0.57 (0.05) 0.61
SHARES OUTSTANDING
Basic 144,204 144,204
Diluted 145,354 145,354
DIVIDENDS PER COMMON SHARE $ 0.0550 0.0550
Three months ended December
31, 2002
-------------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
In thousands, except per share amounts reported items items
--------- --------- ----------
TELEPHONE OPERATIONS
Operating revenues
Local service 186,248 - 186,248
Network access 285,978 - 285,978
Other 47,201 - 47,201
--------- --------- ----------
519,427 - 519,427
--------- --------- ----------
Operating expenses
Plant operations 127,957 - 127,957
Customer operations 45,018 - 45,018
Corporate and other 56,655 - 56,655
Depreciation and amortization 112,980 - 112,980
--------- --------- ----------
342,610 - 342,610
--------- --------- ----------
Telephone operating income 176,817 - 176,817
--------- --------- ----------
OTHER OPERATIONS
Operating revenues
Long distance 40,665 - 40,665
Internet 16,402 - 16,402
Other 9,385 - 9,385
--------- --------- ----------
66,452 - 66,452
--------- --------- ----------
Operating expenses
Cost of sales and other 49,258 1,929 (4) 47,329
Depreciation and amortization 4,901 - 4,901
--------- --------- ----------
54,159 1,929 52,230
--------- --------- ----------
Other operating income 12,293 (1,929) 14,222
--------- --------- ----------
TOTAL OPERATING INCOME 189,110 (1,929) 191,039
OTHER INCOME (EXPENSE)
Interest expense (57,019) - (57,019)
Income from unconsolidated cellular
entity 1,730 - 1,730
Other income and expense (63,458)(60,730)(5) (2,728)
Income tax expense (26,018) 21,930 (6) (47,948)
--------- --------- ----------
NET INCOME 44,345 (40,729) 85,074
========= ========= ==========
BASIC EARNINGS PER SHARE 0.31 (0.29) 0.60
DILUTED EARNINGS PER SHARE 0.31 (0.28) 0.59
SHARES OUTSTANDING
Basic 142,465 142,465
Diluted 143,380 143,380
DIVIDENDS PER COMMON SHARE 0.0525 0.0525
Increase
Increase (decrease)
(decrease) excluding
as nonrecurring
In thousands, except per share amounts reported items
----------- ------------
TELEPHONE OPERATIONS
Operating revenues
Local service 1.2% 1.2%
Network access 1.1% 0.6%
Other (1.5%) (1.5%)
0.9% 0.6%
Operating expenses
Plant operations (0.6%) (0.6%)
Customer operations (3.3%) (3.3%)
Corporate and other 24.2% 10.9%
Depreciation and amortization 0.5% 0.5%
3.5% 1.3%
Telephone operating income (4.1%) (0.7%)
OTHER OPERATIONS
Operating revenues
Long distance 5.5% 5.5%
Internet 31.6% 31.6%
Other 87.7% 87.7%
23.6% 23.6%
Operating expenses
Cost of sales and other 21.4% 26.3%
Depreciation and amortization 9.8% 9.8%
20.3% 24.8%
Other operating income 37.9% 19.2%
TOTAL OPERATING INCOME (1.4%) 0.7%
OTHER INCOME (EXPENSE)
Interest expense 6.7% (6.4%)
Income from unconsolidated cellular entity (26.9%) (26.9%)
Other income and expense (105.0%) (106.9%)
Income tax expense 83.1% 7.0%
NET INCOME 85.9% 4.9%
BASIC EARNINGS PER SHARE 83.9% 3.3%
DILUTED EARNINGS PER SHARE 83.9% 3.4%
SHARES OUTSTANDING
Basic 1.2% 1.2%
Diluted 1.4% 1.4%
DIVIDENDS PER COMMON SHARE 4.8% 4.8%
NONRECURRING ITEMS
(1) Operating taxes, including related revenue effect, and interest
associated with various operating tax audits.
(2) Reversal of costs previously accrued to defend unsolicited
takeover proposal.
(3) Tax effect of items (1) and (2).
(4) Write-off costs associated with abandoned project.
(5) Redemption premium on remarketable notes, net of unamortized
premium ($59.9 million), and write-off of nonoperating investment
($781,000).
CenturyTel, Inc.
CONSOLIDATED STATEMENTS OF INCOME
TWELVE MONTHS ENDED DECEMBER 31, 2003 AND 2002
(UNAUDITED)
Twelve months ended December 31,
2003
--------------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
In thousands, except per share amounts reported items items
--------- -------- ----------
TELEPHONE OPERATIONS
Operating revenues
Local service $ 754,063 - 754,063
Network access 1,135,223 1,500 (1)1,133,723
Other 182,694 - 182,694
--------- -------- ----------
2,071,980 1,500 2,070,480
--------- -------- ----------
Operating expenses
Plant operations 505,786 - 505,786
Customer operations 167,594 - 167,594
Corporate and other 259,635 2,541 (1) 257,094
Depreciation and amortization 450,851 - 450,851
--------- -------- ----------
1,383,866 2,541 1,381,325
--------- -------- ----------
Telephone operating income 688,114 (1,041) 689,155
--------- -------- ----------
OTHER OPERATIONS
Operating revenues
Long distance 173,884 - 173,884
Internet 79,933 - 79,933
Other 54,948 - 54,948
--------- -------- ----------
308,765 - 308,765
--------- -------- ----------
Operating expenses
Cost of sales and other 226,693 - 226,693
Depreciation and amortization 19,790 - 19,790
--------- -------- ----------
246,483 - 246,483
--------- -------- ----------
Other operating income 62,282 - 62,282
--------- -------- ----------
Corporate overhead costs
allocable to discontinued operations - - -
--------- -------- ----------
TOTAL OPERATING INCOME 750,396 (1,041) 751,437
OTHER INCOME (EXPENSE)
Interest expense (226,751)(7,500)(1) (219,251)
Income from unconsolidated cellular
entity 6,160 - 6,160
Nonrecurring gains and losses - - -
Other income and expense 2,154 3,000 (2) (846)
Income tax expense (187,252) 4,466 (3) (191,718)
--------- -------- ----------
INCOME FROM CONTINUING OPERATIONS 344,707 (1,075) 345,782
DISCONTINUED OPERATIONS, NET OF TAX - - -
--------- -------- ----------
NET INCOME $ 344,707 (1,075) 345,782
========= ======== ==========
BASIC EARNINGS PER SHARE
From continuing operations $ 2.40 (0.01) 2.41
From discontinued operations $ - - -
Basic earnings per share $ 2.40 (0.01) 2.41
DILUTED EARNINGS PER SHARE
From continuing operations $ 2.38 (0.01) 2.39
From discontinued operations $ - - -
Diluted earnings per share $ 2.38 (0.01) 2.39
SHARES OUTSTANDING
Basic 143,583 143,583
Diluted 144,700 144,700
DIVIDENDS PER COMMON SHARE $ 0.2200 0.2200
Twelve months ended December 31,
2002
--------------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
In thousands, except per share amounts reported items items
---------- --------- ----------
TELEPHONE OPERATIONS
Operating revenues
Local service 604,580 - 604,580
Network access 972,303 (7,645) (4) 979,948
Other 156,709 - 156,709
---------- --------- ----------
1,733,592 (7,645) 1,741,237
---------- --------- ----------
Operating expenses
Plant operations 433,187 433,187
Customer operations 148,502 - 148,502
Corporate and other 211,924 15,000 (5) 196,924
Depreciation and
amortization 396,866 - 396,866
---------- --------- ----------
1,190,479 15,000 1,175,479
---------- --------- ----------
Telephone operating income 543,113 (22,645) 565,758
---------- --------- ----------
OTHER OPERATIONS
Operating revenues
Long distance 146,536 - 146,536
Internet 58,665 - 58,665
Other 33,203 - 33,203
---------- --------- ----------
238,404 - 238,404
---------- --------- ----------
Operating expenses
Cost of sales and other 180,076 1,929 (6) 178,147
Depreciation and
amortization 14,760 - 14,760
---------- --------- ----------
194,836 1,929 192,907
---------- --------- ----------
Other operating income 43,568 (1,929) 45,497
---------- --------- ----------
Corporate overhead costs
allocable to discontinued
operations (11,275) - (11,275)
---------- --------- ----------
TOTAL OPERATING INCOME 575,406 (24,574) 599,980
OTHER INCOME (EXPENSE)
Interest expense (221,845) - (221,845)
Income from unconsolidated cellular
entity 5,582 - 5,582
Nonrecurring gains and
losses 3,709 3,709 (7) -
Other income and expense (63,814)(63,730) (8) (84)
Income tax expense (105,505) 29,608 (9) (135,113)
---------- --------- ----------
INCOME FROM CONTINUING OPERATIONS 193,533 (54,987) 248,520
DISCONTINUED OPERATIONS, NET OF TAX 608,091 531,625 (10) 76,466
---------- --------- ----------
NET INCOME 801,624 476,638 324,986
---------- --------- ----------
BASIC EARNINGS PER SHARE
From continuing operations 1.36 (0.39) 1.75
From discontinued
operations 4.29 3.75 0.54
Basic earnings per share 5.66 3.37 2.29
DILUTED EARNINGS PER SHARE
From continuing operations 1.35 (0.38) 1.74
From discontinued
operations 4.26 3.72 0.54
Diluted earnings per share 5.61 3.34 2.27
SHARES OUTSTANDING
Basic 141,613 141,613
Diluted 142,879 142,879
DIVIDENDS PER COMMON SHARE 0.2100 0.2100
Increase
Increase (decrease)
(decrease) excluding
In thousands, except per share amounts as nonrecurring
reported items
----------- ------------
TELEPHONE OPERATIONS
Operating revenues
Local service 24.7% 24.7%
Network access 16.8% 15.7%
Other 16.6% 16.6%
19.5% 18.9%
Operating expenses
Plant operations 16.8% 16.8%
Customer operations 12.9% 12.9%
Corporate and other 22.5% 30.6%
Depreciation and amortization 13.6% 13.6%
16.2% 17.5%
Telephone operating income 26.7% 21.8%
OTHER OPERATIONS
Operating revenues
Long distance 18.7% 18.7%
Internet 36.3% 36.3%
Other 65.5% 65.5%
29.5% 29.5%
Operating expenses
Cost of sales and other 25.9% 27.3%
Depreciation and amortization 34.1% 34.1%
26.5% 27.8%
Other operating income 43.0% 36.9%
Corporate overhead costs
allocable to discontinued operations (100.0%) (100.0%)
TOTAL OPERATING INCOME 30.4% 25.2%
OTHER INCOME (EXPENSE)
Interest expense 2.2% (1.2%)
Income from unconsolidated cellular entity 10.4% 10.4%
Nonrecurring gains and losses (100.0%) -%
Other income and expense (103.4%) 907.1%
Income tax expense 77.5% 41.9%
INCOME FROM CONTINUING OPERATIONS 78.1% 39.1%
DISCONTINUED OPERATIONS, NET OF TAX (100.0%) (100.0%)
NET INCOME (57.0%) 6.4%
BASIC EARNINGS PER SHARE
From continuing operations 76.5% 37.7%
From discontinued operations (100.0%) (100.0%)
Basic earnings per share (57.6%) 5.2%
DILUTED EARNINGS PER SHARE
From continuing operations 76.3% 37.4%
From discontinued operations (100.0%) (100.0%)
Diluted earnings per share (57.6%) 5.3%
SHARES OUTSTANDING
Basic 1.4% 1.4%
Diluted 1.3% 1.3%
DIVIDENDS PER COMMON SHARE 4.8% 4.8%
NONRECURRING ITEMS
(1) Includes (i) operating taxes ($7.5 million), net of related
revenue effect ($1.5 million), and interest cost ($7.5 million)
associated with various operating tax audits and (ii) partial
recovery of amounts previously written off in connection with
WorldCom bankruptcy ($4.9 million; see Note 5).
(2) Reversal of costs previously accrued to defend unsolicited
takeover proposal.
(3) Net out of period income tax adjustments ($2.5 million credit),
net of tax effect of items (1) and (2).
(4) Reserve for refunds of access charges to interexchange carriers.
(5) Reserve for uncollectible receivables, primarily WorldCom.
(6) Write off costs associated with abandoned project.
(7) Gain on sale of PCS license.
(8) Redemption premium on remarketable notes, net of unamortized
premium ($59.9 million); costs to defend unsolicited takeover
proposal ($3.0 million); and write-off of nonoperating investment
($781,000).
(9) Tax effect of items (4) through (8).
(10) Gain on sale of wireless operations ($551.4 million after-tax),
net of write down of wireless portion of billing system ($19.8
million after-tax).
CenturyTel, Inc.
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2003 AND DECEMBER 31, 2002
(UNAUDITED)
Dec. 31, Dec. 31,
2003 2002
----------- -----------
(in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 203,181 3,661
Other current assets 259,758 292,241
----------- -----------
Total current assets 462,939 295,902
----------- -----------
PROPERTY, PLANT AND EQUIPMENT
Telephone 6,596,600 6,347,900
Other 587,555 521,292
Accumulated depreciation (3,728,674) (3,337,547)
----------- -----------
Net property, plant and
equipment 3,455,481 3,531,645
----------- -----------
INVESTMENTS AND OTHER ASSETS
Goodwill 3,425,001 3,427,281
Other 552,431 515,580
----------- -----------
Total investments and other
assets 3,977,432 3,942,861
----------- -----------
TOTAL ASSETS $ 7,895,852 7,770,408
=========== ===========
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Current maturities of long-term
debt $ 72,453 70,737
Other current liabilities 398,930 317,367
----------- -----------
Total current liabilities 471,383 388,104
LONG-TERM DEBT 3,109,302 3,578,132
DEFERRED CREDITS AND OTHER
LIABILITIES 836,651 716,168
STOCKHOLDERS' EQUITY 3,478,516 3,088,004
----------- -----------
TOTAL LIABILITIES AND EQUITY $ 7,895,852 7,770,408
=========== ===========
CAPITAL EXPENDITURES
TWELVE MONTHS ENDED DECEMBER 31, 2003 AND 2002
Twelve months ended December 31,
Increase
2003 2002 (decrease)
----------- ---------------------
(in thousands)
CAPITAL EXPENDITURES
Telephone $ 317,357 319,536 (0.7%)
Wireless (discontinued
operations) - 27,242 (100.0%)
Other 60,582 66,731 (9.2%)
----------- -----------
Total capital expenditures $ 377,939 413,509 (8.6%)
=========== ===========
CAPITAL EXPENDITURES
THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002
Three months ended December 31,
Increase
2003 2002 (decrease)
----------- ---------------------
(in thousands)
CAPITAL EXPENDITURES
Telephone $ 100,909 98,209 2.7%
Other 20,571 17,284 19.0%
----------- -----------
Total capital expenditures $ 121,480 115,493 5.2%
=========== ===========
CenturyTel, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Three months ended
December 31, 2003
-----------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
reported items items
--------- --------- ---------
Consolidated operating cash flow and
cash flow margin
Operating income $ 186,461 (6,000)(1) 192,461
Add: Depreciation and amortization 118,981 118,981
--------- --------- ---------
Consolidated operating cash flow $ 305,442 (6,000) 311,442
========= ========= =========
Revenues $ 606,315 1,500 (1) 604,815
========= ========= =========
Consolidated cash flow margin (operating
cash flow divided by revenues) 50.4% 51.5%
========= ========= =========
Telephone operating cash flow,
operating income margin
and cash flow margin
Telephone operating income $ 169,514 (6,000)(1) 175,514
Add: Depreciation and amortization 113,601 - 113,601
--------- --------- ---------
Telephone operating cash flow $ 283,115 (6,000) 289,115
========= ========= =========
Telephone revenues $ 524,191 1,500 (1) 522,691
========= ========= =========
Telephone operating income margin
(operating income divided by revenues) 32.3% 33.6%
========= =========
Telephone cash flow margin (operating
cash flow divided by revenues) 54.0% 55.3%
========= =========
Other Operations operating cash flow,
operating income margin and
cash flow margin
Other Operations operating income $ 16,947 - 16,947
Add: Depreciation and amortization 5,380 - 5,380
--------- --------- ---------
Other Operations operating cash flow $ 22,327 - 22,327
========= ========= =========
Other Operations revenues $ 82,124 - 82,124
========= ========= =========
Other Operations operating income margin
(operating income divided by revenues) 20.6% 20.6%
========= =========
Other Operations cash flow margin
(operating cash flow divided by
revenues) 27.2% 27.2%
========= =========
Free cash flow (prior to debt service
requirements and dividends)
Net income $ 82,442 (6,825)(2) 89,267
Add: Depreciation and amortization 118,981 - 118,981
Less: Capital expenditures (121,480) - (121,480)
--------- --------- ---------
Free cash flow $ 79,943 (6,825) 86,768
========= ========= =========
Free cash flow $ 79,943
Income from unconsolidated cellular
entity (1,265)
Deferred income taxes 60,684
Changes in current assets and current
liabilities 32,553
Increase in other noncurrent assets (5,248)
Increase (decrease) in other noncurrent
liabilities (1,361)
Retirement benefits (40,336)
Other, net (6,908)
Add: capital expenditures 121,480
---------
Net cash provided by operating
activities $ 239,542
=========
Three months ended
December 31, 2002
-------------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
reported items items
--------- --------- ----------
Consolidated operating cash flow and
cash flow margin
Operating income 189,110 (1,929)(3) 191,039
Add: Depreciation and amortization 117,881 - 117,881
--------- --------- ----------
Consolidated operating cash flow 306,991 (1,929) 308,920
========= ========= ==========
Revenues 585,879 - 585,879
========= ========= ==========
Consolidated cash flow margin (operating
cash flow divided by revenues) 52.4% 52.7%
========= ==========
Telephone operating cash flow, operating income
margin and cash flow margin
Telephone operating income 176,817 - 176,817
Add: Depreciation and amortization 112,980 - 112,980
--------- --------- ----------
Telephone operating cash flow 289,797 - 289,797
========= ========= ==========
Telephone revenues 519,427 - 519,427
========= ========= ==========
Telephone operating income margin
(operating income divided by revenues) 34.0% 34.0%
========= ==========
Telephone cash flow margin (operating cash
flow divided by revenues) 55.8% 55.8%
========= ==========
Other Operations operating cash flow, operating
income margin and cash flow margin
Other Operations operating income 12,293 (1,929)(3) 14,222
Add: Depreciation and amortization 4,901 - 4,901
--------- --------- ----------
Other Operations operating cash flow 17,194 (1,929) 19,123
========= ==========
Other Operations revenues 66,452 - 66,452
========= ========= ==========
Other Operations operating income margin
(operating income divided by revenues) 18.5% 21.4%
========= ==========
Other Operations cash flow margin
(operating cash flow divided by revenues) 25.9% 28.8%
========= ==========
Free cash flow (prior to debt service
requirements and dividends)
Net income 44,345 (40,729)(4) 85,074
Add: Depreciation and amortization 117,881 - 117,881
Less: Capital expenditures (115,493) - (115,493)
--------- --------- ----------
Free cash flow 46,733 (40,729) 87,462
========= ========= ==========
Free cash flow 46,733
Income from unconsolidated cellular
entity (1,730)
Deferred income taxes 27,769
Changes in current assets and current
liabilities (35,340)
Increase in other noncurrent assets (6,981)
Increase (decrease) in other
noncurrent liabilities 12,956
Retirement benefits (18,046)
Other, net 17,541
Add: capital expenditures 115,493
----------
Net cash provided by operating
activities 158,395
==========
(1) Operating taxes ($7.5 million), including revenue effect ($1.5
million), associated with various operating tax audits.
(2) Includes (i) interest cost ($4.9 million after-tax) related to
operating tax audits; (ii) benefit from reversal of costs
previously accrued to defend unsolicited takeover proposal ($2.0
million after-tax); and (iii) after tax effect of item (1)
(3) Write off costs associated with abandoned project.
(4) Redemption premium on remarketable notes, net of unamortized
premium ($39.0 million after tax); write off costs associated with
abandoned project ($1.3 million after tax); and write off of
nonoperating investment ($508,000 after tax).
CenturyTel, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Twelve months ended
December 31, 2003
------------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
reported items items
--------- --------- ----------
Consolidated operating cash flow from
continuing operations and cash
flow margin
Operating income $ 750,396 (1,041)(1) 751,437
Add: Depreciation and amortization 470,641 470,641
--------- --------- ----------
Consolidated operating cash flow from
continuing operations $1,221,037 (1,041) 1,222,078
========= ========= ==========
Revenues from continuing operations $2,380,745 1,500 2,379,245
========= ========= ==========
Consolidated cash flow margin
(operating cash flow divided by
revenues) 51.3% 51.4%
========== ==========
Telephone operating cash flow,
operating income margin and
cash flow margin
Telephone operating income $ 688,114 (1,041)(1) 689,155
Add: Depreciation and amortization 450,851 - 450,851
--------- --------- ----------
Telephone operating cash flow $1,138,965 (1,041) 1,140,006
========= ========= ==========
Telephone revenues $2,071,980 1,500 2,070,480
========= ========= ==========
Telephone operating income margin
(operating income divided by revenues) 33.2% 33.3%
========== ==========
Telephone cash flow margin (operating
cash flow divided by revenues) 55.0% 55.1%
========== ==========
Other Operations operating cash flow,
operating income margin and
cash flow margin
Other Operations operating income $ 62,282 - 62,282
Add: Depreciation and amortization 19,790 - 19,790
--------- --------- ----------
Other Operations operating cash flow $ 82,072 - 82,072
========= ========= ==========
Other Operations revenues $ 308,765 - 308,765
========= ========= ==========
Other Operations operating income
margin (operating income divided by
revenues) 20.2% 20.2%
========= ==========
Other Operations cash flow margin
(operating cash flow divided by
revenues) 26.6% 26.6%
========== ==========
Free cash flow (prior to debt service
requirements and dividends)
Net income $ 344,707 (1,075)(2) 345,782
Add: Depreciation and amortization(7) 470,641 - 470,641
Less: Capital expenditures (7) (377,939) - (377,939)
--------- --------- ----------
Free cash flow $ 437,409 (1,075) 438,484
========= ========= ==========
Free cash flow $ 437,409
Income from discontinued operations,
net of tax -
Less: depreciation and amortization of
discontinued operations -
Nonrecurring gains and losses -
Income from unconsolidated cellular
entity (6,160)
Deferred income taxes 128,706
Changes in current assets and current
liabilities 160,984
Increase in other noncurrent assets (23,528)
Increase (decrease) in other
noncurrent liabilities (6,151)
Retirement benefits (14,739)
Other, net 13,504
Add: capital expenditures 377,939
----------
Net cash provided by operating
activities from continuing
operations $1,067,964
==========
Twelve months ended
December 31, 2002
-------------------------------
As
adjusted
Less excluding
non- non-
As recurring recurring
reported items items
--------- --------- ----------
Consolidated operating cash flow from
continuing operations and cash
flow margin
Operating income 575,406 (24,574)(3) 599,980
Add: Depreciation and amortization 411,626 - 411,626
--------- --------- ----------
Consolidated operating cash flow from
continuing operations 987,032 (24,574) 1,011,606
========= ========= ==========
Revenues from continuing operations 1,971,996 (7,645)(4) 1,979,641
========= ========= ==========
Consolidated cash flow margin (operating
cash flow divided by revenues) 50.1% 51.1%
======== ==========
Telephone operating cash flow, operating income
margin and cash flow margin
Telephone operating income 543,113 (22,645)(3) 565,758
Add: Depreciation and amortization 396,866 - 396,866
--------- --------- ----------
Telephone operating cash flow 939,979 (22,645) 962,624
========= ========= ==========
Telephone revenues 1,733,592 (7,645)(4)1,741,237
========= ========= ==========
Telephone operating income margin
(operating income divided by revenues) 31.3% 32.5%
========= ==========
Telephone cash flow margin (operating
cash flow divided by revenues) 54.2% 55.3%
========= ==========
Other Operations operating cash flow, operating
income margin and cash flow margin
Other Operations operating income 43,568 (1,929)(5) 45,497
Add: Depreciation and amortization 14,760 - 14,760
--------- --------- ----------
Other Operations operating cash flow 58,328 (1,929) 60,257
========= ========= ==========
Other Operations revenues 238,404 - 238,404
========= ========= ==========
Other Operations operating income margin
(operating income divided by revenues) 18.3% 19.1%
========= ==========
Other Operations cash flow margin
(operating cash flow divided by
revenues) 24.5% 25.3%
========= ==========
Free cash flow (prior to debt service
requirements and dividends)
Net income 801,624 476,638 (6) 324,986
Add: Depreciation and amortization
(7) 424,520 - 424,520
Less: Capital expenditures (7) (413,509) - (413,509)
--------- --------- ----------
Free cash flow 812,635 476,638 335,997
========= ========= ==========
Free cash flow 812,635
Income from discontinued operations,
net of tax (608,091)
Less: depreciation and amortization of
discontinued operations (12,894)
Nonrecurring gains and losses (3,709)
Income from unconsolidated cellular
entity (5,582)
Deferred income taxes 71,112
Changes in current assets and current
liabilities 69,650
Increase in other noncurrent assets (30,543)
Increase (decrease) in other
noncurrent liabilities 35,489
Retirement benefits (9,416)
Other, net 61,274
Add: capital expenditures 413,509
----------
Net cash provided by operating
activities from continuing operations 793,434
==========
(1) Operating taxes ($7.5 million), net of related revenue effect
($1.5 million), associated with various operating tax audits, net
of partial recovery of amounts previously written off in
connection with WorldCom bankruptcy ($4.9 million; see Note 3).
(2) Includes (i) interest cost ($4.9 million after-tax) related to
operating tax audits; (ii) benefit from reversal of costs
previously accrued to defend unsolicited takeover proposal ($2.0
million after-tax); (iii) net out of period income tax
adjustments ($2.5 million credit); and (iv) after-tax effect of
item (1).
(3) Reserve for refunds of access charges to interexchange carriers
($7.6 million) and reserve for uncollectible receivables,
primarily WorldCom ($15.0 million).
(4) Reserve for refunds of access charges to interexchange carriers.
(5) Write off costs associated with abandoned project.
(6) Includes gain on sale of wireless operations ($551.4 million after
tax) and gain on sale of a PCS license ($2.4 million after tax).
Such favorable items were partially offset by unfavorable charges
for reserve for refunds of access charges to interexchange
carriers ($5.0 million after tax), reserve for uncollectible
receivables, primarily WorldCom ($9.8 million after tax), costs to
defend unsolicited takeover proposal ($2.0 million after tax) and
write down of wireless portion of billing system ($19.8 million
after tax).
(7) Includes discontinued operations for 2002.
MULTIMEDIA AVAILABLE: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=4560703
CONTACT: CenturyTel, Inc.
, Monroe
Media:
Patricia Cameron, 318-388-9674
patricia.cameron@centurytel.com
or
Investors:
Tony Davis, 318-388-9525
tony.davis@centurytel.com
SOURCE: CenturyTel, Inc.