CONDENSED CONSOLIDATING FINANCIAL INFORMATION (Tables)

3 Months Ended

Sep. 30, 2019

CONDENSED CONSOLIDATING FINANCIAL INFORMATION

Schedule of Condensed Consolidating Balance Sheets

Condensed Consolidating Balance Sheets (Unaudited)

September 30, 2019

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Assets
Current assets
Cash and cash equivalents	$	145.1	$	7.4	$	101.4	$	—	$	253.9
Trade receivables, net of allowance		92.5		1.4		58.0		—		151.9
Prepaid expenses		55.1		0.2		12.8		—		68.1
Other current assets		129.8		—		(72.8)		—		57.0
Total current assets		422.5		9.0		99.4		—		530.9
Property and equipment, net		5,055.9		—		795.9		—		5,851.8
Intangible assets, net		963.3		6.9		122.6		—		1,092.8
Goodwill		1,520.4		14.6		166.1		—		1,701.1
Right-of-use operating lease assets		328.7		1.9		168.6		—		499.2
Deferred income taxes, net		—		—		21.3		—		21.3
Other assets		149.3		—		34.7		—		184.0
Investment in subsidiary		635.2		—		—		(635.2)		—
Total assets	$	9,075.3	$	32.4	$	1,408.6	$	(635.2)	$	9,881.1
Liabilities and member's equity
Current liabilities
Accounts payable	$	15.7	$	0.1	$	16.1	$	—	$	31.9
Accrued liabilities		260.3		0.8		62.5		—		323.6
Accrued interest		84.9		—		—		—		84.9
Current portion of long-term debt		130.0		—		—		—		130.0
Operating lease obligations, current		95.7		1.8		29.7		—		127.2
Finance lease obligations, current		8.3		—		1.2		—		9.5
Deferred revenue, current		135.0		0.1		37.8		—		172.9
Total current liabilities		729.9		2.8		147.3		—		880.0
Long-term debt, non-current		5,318.4		—		377.7		—		5,696.1
Operating lease liabilities, non-current		252.1		—		135.3		—		387.4
Finance lease obligation, non-current		167.5		—		8.5		—		176.0
Deferred revenue, non-current		1,104.0		—		101.4		—		1,205.4
Deferred income taxes, net		144.1		—		3.4		—		147.5
Other long-term liabilities		0.7		—		29.4		—		30.1
Total liabilities		7,716.7		2.8		803.0		—		8,522.5
Member's equity
Member's interest		1,611.5		10.1		445.5		(464.6)		1,602.5
Accumulated other comprehensive loss		(38.3)		—		(38.3)		38.3		(38.3)
Accumulated deficit		(214.6)		19.5		198.4		(208.9)		(205.6)
Total member's equity		1,358.6		29.6		605.6		(635.2)		1,358.6
Total liabilities and member's equity	$	9,075.3	$	32.4	$	1,408.6	$	(635.2)	$	9,881.1

Condensed Consolidating Balance Sheets (Unaudited)

June 30, 2019

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Assets
Current assets
Cash and cash equivalents	$	85.9	$	9.6	$	89.9	$	—	$	185.4
Trade receivables, net of allowance		97.7		2.6		76.7		—		177.0
Prepaid expenses		47.9		0.1		17.3		—		65.3
Other current assets		131.4		—		(74.6)		—		56.8
Total current assets		362.9		12.3		109.3		—		484.5
Property and equipment, net		5,010.1		—		798.8		—		5,808.9
Intangible assets, net		983.7		7.3		127.8		—		1,118.8
Goodwill		1,520.3		14.6		171.7		—		1,706.6
Deferred income taxes, net		1.0		—		23.8		—		24.8
Other assets		152.4		—		37.8		—		190.2
Related party receivable		358.9		—		—		(358.9)		—
Investment in subsidiary		664.1		—		—		(664.1)		—
Total assets	$	9,053.4	$	34.2	$	1,269.2	$	(1,023.0)	$	9,333.8
Liabilities and member's equity
Current liabilities
Accounts payable	$	53.2	$	0.5	$	20.0	$	—	$	73.7
Accrued liabilities		243.4		1.4		70.0		—		314.8
Accrued interest		73.1		—		—		—		73.1
Current portion of long-term debt		5.0		—		—		—		5.0
Finance lease obligations, current		8.6		—		1.4		—		10.0
Deferred revenue, current		135.1		0.1		39.7		—		174.9
Total current liabilities		518.4		2.0		131.1		—		651.5
Long-term debt, non-current		5,839.7		—		—		—		5,839.7
Related party debt, long-term		—		—		358.9		(358.9)		—
Finance lease obligation, non-current		163.4		—		8.8		—		172.2
Deferred revenue, non-current		1,045.2		—		102.9		—		1,148.1
Deferred income taxes, net		136.6		—		2.2		—		138.8
Other long-term liabilities		21.3		—		33.4		—		54.7
Total liabilities		7,724.6		2.0		637.3		(358.9)		8,005.0
Member's equity
Member's interest		1,587.4		13.5		462.6		(487.3)		1,576.2
Accumulated other comprehensive loss		(23.9)		—		(23.9)		23.9		(23.9)
Accumulated deficit		(234.7)		18.7		193.2		(200.7)		(223.5)
Total member's equity		1,328.8		32.2		631.9		(664.1)		1,328.8
Total liabilities and member's equity	$	9,053.4	$	34.2	$	1,269.2	$	(1,023.0)	$	9,333.8

Schedule of Condensed Consolidating Statements of Operations

Condensed Consolidating Statements of Comprehensive Income

For the Three Months Ended September 30, 2019

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Revenue	$	507.0	$	5.1	$	126.5	$	—	$	638.6
Operating costs and expenses
Operating costs (excluding depreciation amortization and including stock-based compensation)		169.9		3.4		57.7		—		231.0
Selling, general and administrative expenses (including stock-based compensation)		95.4		0.4		26.8		—		122.6
Depreciation and amortization		138.2		0.5		17.4		—		156.1
Total operating costs and expenses		403.5		4.3		101.9		—		509.7
Operating income		103.5		0.8		24.6		—		128.9
Other expenses
Interest expense		(79.1)		—		(5.6)		—		(84.7)
Foreign currency loss on intercompany loans		(1.0)		—		(11.9)		—		(12.9)
Other expense		0.3		—		0.3		—		0.6
Equity in net earnings of subsidiaries		8.2		—		—		(8.2)		—
Total other expense, net		(71.6)		—		(17.2)		(8.2)		(97.0)
Income/(loss) from operations before income taxes		31.9		0.8		7.4		(8.2)		31.9
Provision for income taxes		11.8		—		2.2		—		14.0
Net income/(loss)		20.1		0.8		5.2		(8.2)		17.9
Other comprehensive (loss)/income, net of income taxes		(14.4)		—		(14.4)		14.4		(14.4)
Comprehensive income/(loss)	$	5.7	$	0.8	$	(9.2)	$	6.2	$	3.5

Condensed Consolidating Statements of Comprehensive Income

For the Three Months Ended September 30, 2018

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Eliminations		Total
	(in millions)
Revenue	$	498.6	$	5.2	$	137.3	$	—	$	641.1
Operating costs and expenses
Operating costs (excluding depreciation amortization and including stock-based compensation)		160.7		3.7		64.0		—		228.4
Selling, general and administrative expenses (including stock-based compensation)		91.3		0.4		30.4		—		122.1
Depreciation and amortization		146.0		0.5		21.3		—		167.8
Total operating costs and expenses		398.0		4.6		115.7		—		518.3
Operating income		100.6		0.6		21.6		—		122.8
Other expenses
Interest expense		(76.5)		—		(5.7)		—		(82.2)
Foreign currency loss on intercompany loans		(2.2)		—		(2.4)		—		(4.6)
Other expense		6.2		—		0.4		—		6.6
Equity in net earnings of subsidiaries		9.8		—		—		(9.8)		—
Total other expense, net		(62.7)		—		(7.7)		(9.8)		(80.2)
Income/(loss) from operations before income taxes		37.9		0.6		13.9		(9.8)		42.6
Provision for income taxes		15.8		—		4.7		—		20.5
Net income/(loss)		22.1		0.6		9.2		(9.8)		22.1
Other comprehensive income/(loss), net of income taxes		6.3		—		6.3		(6.3)		6.3
Comprehensive income/(loss)	$	28.4	$	0.6	$	15.5	$	(16.1)	$	28.4

Schedule of Condensed Consolidating Statements of Cash Flows

Condensed Consolidating Statements of Cash Flows

For the Three Months Ended September 30, 2019

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Total
	(in millions)
Net cash provided by operating activities	$	277.2	$	1.4	$	33.2	$	311.8
Cash flows from investing activities:
Purchases of property and equipment		(184.3)		—		(32.8)		(217.1)
Net cash used in investing activities		(184.3)		—		(32.8)		(217.1)
Cash flows from financing activities:
Principal payments on long-term debt		(21.3)		—		—		(21.3)
Principal repayments on finance lease obligations		(2.0)		—		(0.1)		(2.1)
Contributions to parent		(9.5)		(3.6)		13.1		—
Net cash (used in)/ provided by financing activities		(32.8)		(3.6)		13.0		(23.4)
Effect of changes in foreign exchange rates on cash		—		—		(2.7)		(2.7)
Net increase/(decrease) in cash, cash equivalents and restricted cash		60.1		(2.2)		10.7		68.6
Cash, cash equivalents and restricted cash, beginning of year		86.3		9.6		90.7		186.6
Cash, cash equivalents and restricted cash, end of period	$	146.4	$	7.4	$	101.4	$	255.2

Condensed Consolidating Statements of Cash Flows

For the Three Months Ended September 30, 2018

	Zayo Group,
	LLC		Guarantor		Non-Guarantor
	(Issuer)		Subsidiaries		Subsidiaries		Total
	(in millions)
Net cash provided by operating activities	$	212.0	$	3.1	$	26.7	$	241.8
Cash flows from investing activities:
Purchases of property and equipment		(150.5)		—		(32.0)		(182.5)
Proceeds from sale of SRT, net of cash held in escrow		39.0		—		—		39.0
Net cash used in investing activities		(111.5)		—		(32.0)		(143.5)
Cash flows from financing activities:
Principal payments on long-term debt		(1.3)		—		—		(1.3)
Principal repayments on finance lease obligations		(1.6)		—		(0.3)		(1.9)
Payments to repurchase ZGH common stock		(0.2)		—		—		(0.2)
Contributions to parent		(8.7)		(1.6)		10.3		—
Cash paid for Santa Clara acquisition		(3.3)		—		—		(3.3)
Net cash (used in)/provided by financing activities		(15.1)		(1.6)		10.0		(6.7)
Effect of changes in foreign exchange rates on cash		—		—		2.2		2.2
Net increase in cash, cash equivalents and restricted cash		85.4		1.5		6.9		93.8
Cash, cash equivalents and restricted cash, beginning of year		142.7		5.9		112.0		260.6
Cash, cash equivalents and restricted cash, end of period	$	228.1	$	7.4	$	118.9	$	354.4