CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Tables)

9 Months Ended

Mar. 31, 2017

CONDENSED CONSOLIDATING FINANCIAL INFORMATION

Schedule Of Condensed Consolidating Balance Sheet

Condensed Consolidating Balance Sheets (Unaudited)

March 31, 2017

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Assets
Current assets
Cash and cash equivalents	$	104.6	$	2.2	$	90.9	$	—	$	197.7
Trade receivables, net of allowance		116.3		2.0		71.4		—		189.7
Prepaid expenses		45.3		0.4		26.7		—		72.4
Other assets		39.9		—		(3.2)		—		36.7
Total current assets		306.1		4.6		185.8		—		496.5
Property and equipment, net		4,151.9		—		687.6		—		4,839.5
Intangible assets, net		1,044.2		11.5		140.9		—		1,196.6
Goodwill		1,650.5		14.7		157.4		—		1,822.6
Deferred income taxes, net		51.8		—		—		—		51.8
Other assets		105.6		—		24.2		—		129.8
Related party receivable		330.2		—		—		(330.2)		—
Investment in subsidiary		586.5		—		—		(586.5)		—
Total assets	$	8,226.8	$	30.8	$	1,195.9	$	(916.7)	$	8,536.8
Liabilities and member's equity
Current liabilities
Current portion of long-term debt	$	25.0	$	—	$	—	$	—	$	25.0
Accounts payable		36.7		—		13.5		—		50.2
Accrued liabilities		207.0		0.6		82.2		—		289.8
Accrued interest		75.3		—		—		—		75.3
Capital lease obligations, current		6.6		—		1.2		—		7.8
Deferred revenue, current		109.8		0.2		34.2		—		144.2
Total current liabilities		460.4		0.8		131.1		—		592.3
Long-term debt, non-current		5,498.8		—		—		—		5,498.8
Related party debt, long-term		—		—		330.2		(330.2)		—
Capital lease obligation, non-current		66.1		—		10.4		—		76.5
Deferred revenue, non-current		839.4		—		101.2		—		940.6
Deferred income taxes, net		0.1		—		39.9		—		40.0
Other long-term liabilities		32.4		—		26.6		—		59.0
Total liabilities		6,897.2		0.8		639.4		(330.2)		7,207.2
Member's equity
Member's interest		1,884.1		18.7		546.2		(587.7)		1,861.3
Accumulated other comprehensive loss		(32.9)		—		13.7		—		(19.2)
Accumulated deficit		(521.6)		11.3		(3.4)		1.2		(512.5)
Total member's equity		1,329.6		30.0		556.5		(586.5)		1,329.6
Total liabilities and member's equity	$	8,226.8	$	30.8	$	1,195.9	$	(916.7)	$	8,536.8

Condensed Consolidating Balance Sheets (Unaudited)

June 30, 2016

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Assets
Current assets
Cash and cash equivalents	$	91.3	$	3.0	$	75.8	$	—	$	170.1
Trade receivables, net of allowance		75.5		2.1		70.8		—		148.4
Prepaid expenses		33.7		0.3		34.8		—		68.8
Other assets		(2.0)		—		11.3		—		9.3
Total current assets		198.5		5.4		192.7		—		396.6
Property and equipment, net		3,375.7		—		703.8		—		4,079.5
Intangible assets, net		775.5		12.9		146.5		—		934.9
Goodwill		1,025.5		14.6		174.4		—		1,214.5
Other assets		65.0		—		29.5		—		94.5
Related party receivable		346.7		—		—		(346.7)		—
Investment in subsidiary		550.9		—		—		(550.9)		—
Total assets	$	6,337.8	$	32.9	$	1,246.9	$	(897.6)	$	6,720.0
Liabilities and member's equity
Current liabilities
Accounts payable	$	70.3		—		26.7		—		97.0
Accrued liabilities		116.0		0.7		110.2		—		226.9
Accrued interest		28.6		—		—		—		28.6
Capital lease obligations, current		4.2		—		1.6		—		5.8
Deferred revenue, current		89.1		0.2		40.1		—		129.4
Total current liabilities		308.2		0.9		178.6		—		487.7
Long-term debt, non-current		4,085.3		—		—		—		4,085.3
Related party debt, long-term		—		—		346.7		(346.7)		—
Capital lease obligation, non-current		32.0		—		12.9		—		44.9
Deferred revenue, non-current		681.1		—		112.2		—		793.3
Deferred income taxes, net		3.3		—		44.7		—		48.0
Other long-term liabilities		24.1		—		32.9		—		57.0
Total liabilities		5,134.0		0.9		728.0		(346.7)		5,516.2
Member's equity
Member's interest		1,786.2		22.3		543.2		(579.1)		1,772.6
Accumulated other comprehensive loss		—		—		4.5		—		4.5
Accumulated deficit		(582.4)		9.7		(28.8)		28.2		(573.3)
Total member's equity		1,203.8		32.0		518.9		(550.9)		1,203.8
Total liabilities and member's equity	$	6,337.8	$	32.9	$	1,246.9	$	(897.6)	$	6,720.0

Schedule Of Condensed Consolidating Statements Of Operations

Condensed Consolidating Statements of Operations

For the three months ended March 31, 2017

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Revenue	$	394.5	$	5.4	$	150.3	$	—	$	550.2
Operating costs and expenses
Operating costs (excluding depreciation amortization and including stock-based compensation)		121.7		3.9		69.4		—		195.0
Selling, general and administrative expenses (including stock-based compensation)		73.9		0.3		34.6		—		108.8
Depreciation and amortization		126.8		0.5		28.4		—		155.7
Total operating costs and expenses		322.4		4.7		132.4		—		459.5
Operating income		72.1		0.7		17.9		—		90.7
Other expenses
Interest expense		(57.4)		—		(5.6)		—		(63.0)
Loss on extinguishment of debt		(4.5)		—		—		—		(4.5)
Foreign currency loss on intercompany loans		1.6		—		2.3		—		3.9
Other income		0.4		—		0.1		—		0.5
Equity in net earnings of subsidiaries		15.5		—		—		(15.5)		—
Total other expense, net		(44.4)		—		(3.2)		(15.5)		(63.1)
Income from operations before income taxes		27.7		0.7		14.7		(15.5)		27.6
Provision for income taxes		0.7		—		(0.1)		—		0.6
Net income	$	27.0		0.7		14.8		(15.5)	$	27.0

Condensed Consolidating Statements of Operations

For the nine months ended March 31, 2017

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Revenue	$	1,087.9	$	14.0	$	459.9	$	—	$	1,561.8
Operating costs and expenses
Operating costs (excluding depreciation amortization and including stock-based compensation)		320.4		10.0		218.3		—		548.7
Selling, general and administrative expenses (including stock-based compensation)		207.5		1.0		110.6		—		319.1
Depreciation and amortization		352.2		1.4		72.0		—		425.6
Total operating costs and expenses		880.1		12.4		400.9		—		1,293.4
Operating income		207.8		1.6		59.0		—		268.4
Other expenses
Interest expense		(153.4)		—		(16.6)		—		(170.0)
Loss on extinguishment of debt		(4.5)		—		—		—		(4.5)
Foreign currency loss on intercompany loans		(5.6)		—		(19.1)				(24.7)
Other income		0.4		—		0.3		—		0.7
Equity in net earnings of subsidiaries		27.0		—		—		(27.0)		—
Total other expense, net		(136.1)		—		(35.4)		(27.0)		(198.5)
Income from operations before income taxes		71.7		1.6		23.6		(27.0)		69.9
Provision/(benefit) for income taxes		9.2		—		(1.8)		—		7.4
Net income	$	62.5	$	1.6	$	25.4	$	(27.0)	$	62.5

Condensed Consolidating Statements of Operations (Unaudited)

For the three months ended March 31, 2016

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	Issuer		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Revenue	$	331.6	$	4.6	$	141.8	$	—	$	478.0
Operating costs and expenses
Operating costs (excluding depreciation amortization and including stock-based compensation)		105.0		3.1		62.7		—		170.8
Selling, general and administrative expenses (including stock-based compensation)		57.6		0.3		54.6		—		112.5
Depreciation and amortization		110.1		0.5		26.6		—		137.2
Total operating costs and expenses		272.7		3.9		143.9		—		420.5
Operating income		58.9		0.7		(2.1)		—		57.5
Other expenses
Interest expense		(52.2)		—		(5.5)		—		(57.7)
Foreign currency loss on intercompany loans		(11.0)		—		(0.1)		—		(11.1)
Other expense		(0.2)		—		—		—		(0.2)
Equity in net earnings of subsidiaries		(0.4)		—		—		0.4		—
Total other expense, net		(63.8)		—		(5.6)		0.4		(69.0)
(Loss)/Income from operations before income taxes		(4.9)		0.7		(7.7)		0.4		(11.5)
Provision for income taxes		8.0		—		(0.2)		—		7.8
Net (loss)/income	$	(12.9)	$	0.7	$	(7.5)	$	0.4	$	(19.3)

Condensed Consolidating Statements of Operations (Unaudited)

For the nine months ended March 31, 2016

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	Issuer		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Revenue	$	979.0	$	13.8	$	221.6	$	—	$	1,214.4
Operating costs and expenses
Operating costs (excluding depreciation amortization and including stock-based compensation)		297.7		9.9		88.4		—		396.0
Selling, general and administrative expenses (including stock-based compensation)		205.2		0.8		76.1		—		282.1
Depreciation and amortization		319.4		1.4		47.2		—		368.0
Total operating costs and expenses		822.3		12.1		211.7		—		1,046.1
Operating income		156.7		1.7		9.9		—		168.3
Other expenses
Interest expense		(146.7)		—		(16.0)		—		(162.7)
Foreign currency loss on intercompany loans		(28.4)		—		(0.5)		—		(28.9)
Other expense		—		—		(0.4)		—		(0.4)
Equity in net earnings of subsidiaries		0.5		—		—		(0.5)		—
Total other expense, net		(174.6)		—		(16.9)		(0.5)		(192.0)
(Loss)/income from operations before income taxes		(17.9)		1.7		(7.0)		(0.5)		(23.7)
Provision for income taxes		20.0		—		1.6		—		21.6
Net (loss)/income	$	(37.9)	$	1.7	$	(8.6)	$	(0.5)	$	(45.3)

Schedule Of Condensed Consolidating Statements Of Cash Flows

Condensed Consolidating Statements of Cash Flows

Nine months ended March 31, 2017

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Total
	(in millions)
Net cash provided by operating activities	$	575.9	$	2.8	$	86.2	$	664.9
Cash flows from investing activities:
Purchases of property and equipment		(573.7)		—		(56.5)		(630.2)
Acquisitions, net of cash acquired		(1,428.3)		—		1.5		(1,426.8)
Other		1.5		—		—		1.5
Net cash used in investing activities		(2,000.5)		—		(55.0)		(2,055.5)
Cash flows from financing activities:
Proceeds from debt		3,293.8		—		—		3,293.8
Principal payments on long-term debt		(1,837.4)		—		—		(1,837.4)
Principal repayments on capital lease obligations		(3.8)		—		(1.0)		(4.8)
Payment of debt issuance costs		(29.0)		—		—		(29.0)
Contributions to parent		10.8		—		(10.8)		—
Receipt from/(payment of) principal balance of intercompany loans		3.6		(3.6)		—		—
Net cash provided by/(used in) financing activities		1,438.0		(3.6)		(11.8)		1,422.6
Net cash flows		13.4		(0.8)		19.4		32.0
Effect of changes in foreign exchange rates on cash		(0.1)		—		(4.3)		(4.4)
Net (decrease)/increase in cash and cash equivalents		13.3		(0.8)		15.1		27.6
Cash and cash equivalents, beginning of period		91.3		3.0		75.8		170.1
Cash and cash equivalents, end of period	$	104.6	$	2.2	$	90.9	$	197.7

Condensed Consolidating Statements of Cash Flows

Nine months ended March 31, 2016

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Total
	(in millions)
Net cash provided by operating activities	$	464.2	$	1.5	$	72.2	$	537.9
Cash flows from investing activities:
Purchases of property and equipment		(475.2)		—		(41.5)		(516.7)
Acquisitions, net of cash acquired		(323.7)		—		(93.3)		(417.0)
Net cash used in investing activities		(798.9)		—		(134.8)		(933.7)
Cash flows from financing activities:
Proceeds from debt		395.2		—		—		395.2
Principal payments on long-term debt		(13.4)		—		—		(13.4)
Principal payments on capital lease obligations		(3.0)		—		(0.3)		(3.3)
Payment of debt issuance costs		(2.9)		—		—		(2.9)
Contributions to parent		(95.8)		—		14.7		(81.1)
Loan to parent		(99.1)		—		99.1		—
Excess tax benefit from stock-based compensation		9.0		(1.1)		—		7.9
Net cash provided by financing activities		190.0		(1.1)		113.5		302.4
Net cash flows		(144.7)		0.4		50.9		(93.4)
Effect of changes in foreign exchange rates on cash		—		—		0.1		0.1
Net decrease in cash and cash equivalents		(144.7)		0.4		51.0		(93.3)
Cash and cash equivalents, beginning of period		275.9		3.1		29.0		308.0
Cash and cash equivalents, end of period	$	131.2	$	3.5	$	80.0	$	214.7