-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NRgSbcRuc1gskiD3TY60rNy8LyOVAQM6PEsEXIr903Mog5voo3DpSkvhmMR+S0La i2WFs960Plu/KISlWs2JkQ== 0000732713-96-000013.txt : 19961108 0000732713-96-000013.hdr.sgml : 19961108 ACCESSION NUMBER: 0000732713-96-000013 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960717 ITEM INFORMATION: Other events FILED AS OF DATE: 19961107 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BELLSOUTH CORP CENTRAL INDEX KEY: 0000732713 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 581533433 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08607 FILM NUMBER: 96655547 BUSINESS ADDRESS: STREET 1: 1155 PEACHTREE ST NE CITY: ATLANTA STATE: GA ZIP: 30367 BUSINESS PHONE: 4042492000 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 17, 1996 BELLSOUTH CORPORATION (Exact name of registrant as specified in its charter) Georgia 1-8607 58-1533433 (State or other (Commission (IRS Employer jurisdiction of File Number) Identification incorporation) No.) 1155 Peachtree Street, N. E., Atlanta, Georgia 30309-3610 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (404) 249-2000 Item 5. Other Events BellSouth Corporation reported earnings per share (EPS) of 63 cents for the third quarter 1996. It was BellSouth's 15th consecutive quarter of improved operating results, with EPS up 12.5 percent compared with 56 cents in the third quarter of 1995. Net income in the three months ended September 30, 1996 was $631 million, up 12.9 percent compared with $559 million in the third quarter a year ago. In the past 12 months alone, BellSouth added nearly 2.5 million customers in its existing telephone, wireless and international operations. BellSouth added a total of 222,000 access lines in the South during July, August and September. The annual growth rate was 4.9 percent. Business access lines grew 8.5 percent. So far in 1996, the company has activated 203,000 new additional lines for residential customers. It now has 1.5 million in service, an annual growth rate of more than 23 percent. BellSouth has 21.9 million total access lines. Value-priced convenience features such as Call Waiting and Caller ID generated sales of about 11,000 units per day in the past year. Caller ID features in service are up 96.5 percent in the past 12 months, to more than 3 million. Call Waiting Deluxe, used in conjunction with Caller ID, went from 2,300 in service a year ago to 146,600 at September 30. Quarterly revenues from these and other enhanced services increased 43 percent, to approximately $281 million. With 3,333,000 domestic cellular customers at the end of the third quarter, U.S. operations grew at an annual rate of 31 percent. In BellSouth's 11 international cellular markets, customers more than doubled since September 1995, and the company passed the 1 million customer milestone in July. BellSouth's quarterly revenues of $4.8 billion increased 9.0 percent compared with the third quarter of 1995. Total operating expenses increased 7.5 percent. When the paging operations sold in January 1996 are excluded, quarterly revenues increased 11.3 percent, and total operating expenses increased 10.2 percent. In BellSouth's telephone operations, cash operating expenses were up 5.0 percent. BellSouth believes that normalized earnings growth could be in the low double digits through 1997. This forward-looking statement is based on a number of assumptions including, but not limited to: (1) economic growth and demand for wireline and wireless communications services continues in BellSouth's service territories; (2) BellSouth Telecommunications, Inc. is successful in furthering its cost reduction efforts; (3) the effect of access reform initiatives now being considered by the FCC is reasonably revenue neutral and (4) significant local service competition in BellSouth's service territories does not emerge through 1997. Any developments significantly deviating from these assumptions could cause actual results to differ materially from those in the above forward-looking statement. PRELIMINARY October 17, 1996 BELLSOUTH CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In Millions, Except Per Share Amounts) (Unaudited) For the Three For the Nine Months Ended Months Ended September 30, September 30, 1996 1995 1996 1995 Operating Revenues: Network and related services Local service $ 2,061 $ 1,857 $ 6,012 $ 5,419 Interstate access 892 805 2,672 2,406 Intrastate access 207 230 627 683 Toll 195 220 600 767 Wireless communications 723 665 2,039 1,888 Directory advertising and publishing 415 366 1,100 1,108 Other services 336 289 940 850 Total Operating Revenues 4,829 4,432 13,990 13,121 Operating Expenses: Cost of services and products 1,516 1,542 4,483 4,530 Depreciation and amortization 940 874 2,760 2,568 Selling, general and administrative 1,172 958 3,175 2,774 Total Operating Expenses 3,628 3,374 10,418 9,872 Operating Income 1,201 1,058 3,572 3,249 Interest Expense 177 172 531 532 Gain on Sale of Paging Business -- -- 442 -- Other Income, net 32 53 84 51 Income Before Income Taxes and Extraordinary Losses 1,056 939 3,567 2,768 Provision for Income Taxes 425 380 1,337 1,105 Income Before Extraordinary Losses 631 559 2,230 1,663 Extraordinary Loss for Discontinuance of SFAS No. 71, net of tax -- -- -- (2,718) Extraordinary Loss on Early Extinguishment of Debt, net of tax -- -- -- (16) Net Income (Loss) $ 631 $ 559 $ 2,230 $(1,071) PRELIMINARY October 17, 1996 BELLSOUTH CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In Millions, Except Per Share Amounts) (Unaudited) For the Three For the Nine Months Ended Months Ended September 30, September 30, 1996 1995 1996 1995 Weighted Average Common Shares Outstanding 994 993 994 993 Dividends Declared Per Common Share $ .36 $ .36 $ 1.08 $ 1.05 Earnings (Loss) Per Share: Income Before Extraordinary Losses $ .63 $ .56 $ 2.24 $ 1.67 Extraordinary Loss for Discontinuance of SFAS No. 71, net of tax -- -- -- (2.73) Extraordinary Loss on Early Extinguishment of Debt, net of tax -- -- -- (.02) Earnings (Loss) Per Share $ .63 $ .56 $ 2.24 $(1.08) PRELIMINARY October 17, 1996 BELLSOUTH CORPORATION CONSOLIDATED BALANCE SHEETS (In Millions, Except Per Share Amounts) September 30, December 31, 1996 1995 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ 1,338 $ 1,711 Temporary cash investments 44 71 Accounts receivable, net of allowance for uncollectibles of $162 and $171 3,846 3,772 Material and supplies 416 430 Other current assets 404 521 6,048 6,505 Investments and Advances 2,563 2,418 Property, Plant and Equipment: Property, Plant and Equipment 49,232 46,869 Accumulated Depreciation 27,625 25,777 21,607 21,092 Intangible Assets, net 1,321 1,527 Deferred Charges and Other Assets 529 338 Total Assets $ 32,068 $ 31,880 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Debt maturing within one year $ 2,219 $ 2,951 Accounts payable 1,357 1,724 Other current liabilities 2,671 2,715 6,247 7,390 Long-Term Debt 7,878 7,924 Deferred Credits and Other Liabilities: Accumulated deferred income taxes 1,728 1,650 Unamortized investment tax credits 297 355 Other liabilities and deferred credits 2,860 2,736 4,885 4,741 Shareholders' Equity: Common stock, $1 par value 1,009 1,007 Paid-in capital 7,664 7,619 Retained earnings 5,262 4,099 Shares held in trust (409) (374) Guarantee of ESOP debt (468) (526) 13,058 11,825 Total Liabilities and Shareholders' Equity $ 32,068 $ 31,880 PRELIMINARY October 17, 1996 BELLSOUTH FINANCIAL HIGHLIGHTS SELECTED DATA (UNAUDITED) Three Months Three Months Ended Ended September 30, September 30, 1996 1995 Weighted average common shares outstanding (millions) 994 993 Earnings per share $ .63 $ .56 Dividends per share $ .36 $ .36 Return to average common equity (annualized) 19.3% 18.0% Return to average total capital(annualized) 13.4% 12.3% Property additions (millions) $1,043 $ 949 At September 30, 1996 1995 Common shares outstanding (millions) 994 993 Debt ratio 43.5% 43.3% Total employees 82,331 89,544 PRELIMINARY October 17, 1996 BELLSOUTH FINANCIAL HIGHLIGHTS SELECTED DATA (UNAUDITED) Nine Months Nine Months Ended Ended September 30, September 30, 1996 1995 Weighted average common shares outstanding (millions) 994 993 Earnings (Loss) per share $ 2.24(d) $(1.08)(a) Dividends per share $ 1.08 $ 1.05 Return to average common equity (annualized) 23.5% (10.4%)(b) Return to average total capital(annualized) 15.6% (3.6%)(c) Property additions (millions) $3,224 $2,760 (a) Excluding the extraordinary losses, Earnings per share were $1.67. (b) After adjusting net income for the impact of the extraordinary losses, Return to average common equity was 16.1%. (c) After adjusting net income for the impact of the extraordinary losses, Return to average total capital was 11.9%. (d) Includes after-tax gain of $.35 per share from sale of paging business. PRELIMINARY October 17, 1996 BELLSOUTH TELECOMMUNICATIONS, INC. CONSOLIDATED STATEMENTS OF INCOME (In Millions) (Unaudited) For the Three For the Nine Months Ended Months Ended September 30, September 30, 1996 1995 1996 1995 Operating Revenues: Local service $ 2,061 $ 1,857 $ 6,012 $ 5,419 Interstate access 892 805 2,672 2,406 Intrastate access 207 230 627 683 Toll 195 220 600 767 Other 405 493 1,149 1,486 Total Operating Revenues 3,760 3,605 11,060 10,761 Operating Expenses: Cost of services and products 1,310 1,336 3,854 3,894 Depreciation and amortization 820 775 2,427 2,286 Selling, general and administrative 699 577 1,921 1,693 Total Operating Expenses 2,829 2,688 8,202 7,873 Operating Income 931 917 2,858 2,888 Interest Expense 136 135 410 425 Other Income, net -- 8 17 20 Income Before Income Taxes and Extraordinary Losses 795 790 2,465 2,483 Provision for Income Taxes 298 303 919 944 Income Before Extraordinary Losses 497 487 1,546 1,539 Extraordinary Loss for Discontinuance of SFAS No. 71, net of tax -- -- -- (2,718) Extraordinary Loss on Early Extinguishment of Debt, net of tax -- -- -- (16) Net Income (Loss) $ 497 $ 487 $ 1,546 $(1,195) PRELIMINARY October 17, 1996 BELLSOUTH TELECOMMUNICATIONS FINANCIAL HIGHLIGHTS SELECTED DATA (UNAUDITED) Three Months Three Months Ended Ended September 30, September 30, 1996 1995 Property additions (millions) $ 744 $ 758 Access minutes of use (millions): Interstate 16,966 15,714 Intrastate 5,348 4,885 IntraLATA toll messages 252 327 (millions) At September 30, 1996 1995 Debt ratio 49.8% 47.2% Telephone employees 64,860 71,090 Network access lines in service (thousands) 21,943 20,924 Nine Months Nine Months Ended Ended September 30, September 30, 1996 1995 Property additions (millions) $2,442 $2,259 Access minutes of use (millions): Interstate 50,473 46,442 Intrastate 15,701 14,204 IntraLATA toll messages 791 1,049 (millions) SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. BELLSOUTH CORPORATION By: /s/ Ronald M. Dykes_ Ronald M. Dykes Executive Vice President, Chief Financial Officer and Comptroller November 5, 1996 -----END PRIVACY-ENHANCED MESSAGE-----