[February 15, 2018] |
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Cincinnati Bell Reports Fourth Quarter and Full Year 2017 Results
Cincinnati Bell Inc. (NYSE:CBB), today announced financial results for
its full year and fourth quarter, ended December 31, 2017. For the full
year, strategic revenue increased from $638 million to $705 million,
driven by strong demand for fiber-based products and $32 million of OnX
strategic revenue. Fioptics internet subscribers totaled 226,600 at the
end of the fourth quarter, up 5,400 compared to the end of the third
quarter of 2017. Fioptics video subscribers totaled 146,500, up 3,000
from the previous quarter. During the year, the Company passed an
additional 38,800 addresses with Fioptics, which is now available to
572,200 homes and businesses, or approximately 70% of Greater Cincinnati.
Leigh Fox, President and Chief Executive Officer of Cincinnati Bell,
commented, "Our strong full year performance demonstrates the solid
progress we have made in executing our growth strategy. This was an
important year for Cincinnati Bell as we focused on building two
distinct, complementary lines of business with expanded geographic
reach, customer diversification and increased runway for growth."
Mr. Fox continued, "Central to this strategy has been the previously
announced mergers with OnX and Hawaiian Telcom. These combinations bring
meaningful scale to their respective businesses and position us to
capitalize on the fast-growing demand for strategic fiber and cloud
services offerings. We have successfully completed the acquisition of
OnX and integration efforts continue to progress well. I am also pleased
to report that we received overwhelming support from Hawaiian Telcom
shareholders and the pending merger has made significant headway in
gaining the necessary regulatory approvals."
CONSOLIDATED RESULTS
Consolidated revenue totaled $427 million for the fourth quarter of 2017
and $1,289 million for the full year.
Operating income was $10 million in the fourth quarter of 2017, compared
to $11 million in the prior year period. Full year operating income
totaling $38 million, decreased from the prior year due to restructuring
and severance related charges as well as transaction and integration
costs. Adjusted EBITDA totaled $78 million for the fourth quarter of
2017, and $303 million for the full year, in line with the Company's
2017 revised guidance.
Net loss for the fourth quarter of 2017 totaled $16 million, resulting
in diluted loss per share of $0.45. Net income for the full year totaled
$35 million, or $0.58 per diluted share.
Entertainment and Communications Segment
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Entertainment and Communications revenue totaled $197 million for the
fourth quarter of 2017 and $790 million for the full year, up $4
million and $21 million year-over-year, respectively.
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Fioptics revenue totaled $80 million for the fourth quarter, a 17%
increase year-over-year, and $310 million for the full year, a 22%
increase compared to a year ago.
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Strategic revenue for business and carrier customers totaled $55
million for the fourth quarter and $217 million for the full year,
up 7% and 9% year-over-year, respectively.
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Operating income was $16 million for the fourth quarter of 2017, up $1
million compared to a year ago. Full year operating income totaling
$65 million decreased from the prior year due to increased
restructuring and severance related charges.
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Adjusted EBITDA was $70 million for the fourth quarter of 2017,
consistent with the prior year period. Full year Adjusted EBITDA
totaled $287 million, up $4 million compared to a year ago.
Cincinnati Bell's continued strategic investments in fiber allow the
Company to expand its portfolio of high density, next-generation fiber
to benefit from the growing demand for data capacity and lock in fiber
density value for shareholders and customers. In the fourth quarter of
2017, Cincinnati Bell completed several critical milestones regarding
the approval process of its pending merger with Hawaiian Telcom. On
November 7, 2017, Hawaiian Telcom shareholders overwhelmingly approved
the transaction. The merger also cleared the Hart-Scott-Rodino Act
review period in November, and received approval from the State of
Hawaii DCCA Cable Division on December 8, 2017. Regulatory review
processes are also underway with the Federal Communications Commission
and the Public Utilities Commission of the State of Hawaii. The merger
approval process continues to progress as anticipated and the
transaction is expected to close in the second half of 2018. The Company
has secured the necessary financing to fund the cash portion of the
transaction, refinance existing Hawaiian Telcom indebtedness and pay
fees and expenses in connection with the foregoing.
IT Services and Hardware Segment
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IT Services and Hardware revenue totaled $233 million for the fourth
quarter of 2017 and $512 million for the full year, up $138 million
and $81 million year-over-year, respectively. IT Services and Hardware
revenue in the fourth quarter reflects a $150 million contribution
from the OnX acquisition, which mitigated the ongoing declines in
hardware sales as well as cost cutting initiatives by a large customer.
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Strategic revenue totaled $72 million for the fourth quarter, of
which OnX contributed $32 million. Full year strategic revenue
totaled $199 million up 1% year-over-year.
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Telecom and IT hardware revenue was $155 million for the fourth
quarter of 2017, up $118 million compared to the prior year
period, driven by the incremental contribution from OnX. Full year
Telecom and IT hardware revenue was $280 million, up $75 million
compared to the prior year.
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Operating income was $3 million for the fourth quarter of 2017 and $11
million for the full year, up $1 million and down $13 million
year-over-year, respectively. OnX operating income totaled $2 million
in the fourth quarter of 2017.
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Adjusted EBITDA was $12 million for the fourth quarter, up $4 million
from the prior year, including an $8 million contribution from OnX.
Full year Adjusted EBITDA totaled $34 million, down $7 million
compared to a year ago.
In the beginning of the fourth quarter of 2017, Cincinnati Bell
announced the successful completion of its acquisition of OnX Enterprise
Solutions, and integration plans are progressing well. The combination
of CBTS and OnX supports the Company's transformation to a leading North
American hybrid IT solutions provider, with an expanded footprint of 20+
IT sales offices and addition of approximately 2,000 new customers in
Canada and throughout the United States. The combined company's hosted
and managed IT services portfolio coupled with its enhanced scale
uniquely positions Cincinnati Bell to capitalize on significant market
opportunities presented by UCaaS, cloud, security, and infrastructure
needs.
Financial Position and Cash Flow
The Company reported cash provided by operating activities of $203
million for the full year 2017, compared to $173 million in the prior
year. Free cash flow totaled $28 million for the full year 2017, an
increase of $141 million year-over-year. Capital expenditures were $210
million in 2017, compared to $286 million in 2016. The Company expects
full year 2018 capital expenditures between $190 million and $210
million.
2018 Outlook
Cincinnati Bell is providing the following guidance for 2018:
Category
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2018 Guidance Range
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Revenue
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$1,200M - $1,275M
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Adjusted EBITDA
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$320M - $330M
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This revenue guidance reflects the new ASC 606 revenue recognition
standard, effective January 1, 2018, and presents Telecom and IT
Hardware sales net of product cost. For reference, had the revenue
standard not been effective, our revenue guidance range would have been
$1,700 million to $1,775 million.
The company's 2018 guidance does not include any contribution from
pending merger with Hawaiian Telcom.
Mr. Fox concluded, "As we enter 2018, I am excited about the
opportunities to further differentiate ourselves from traditional
carriers in the marketplace. Our growth trajectory is supported by our
continued investments in high-speed, high-bandwidth fiber networks where
we are winning. The pending merger with Hawaiian Telcom represents an
important step toward scaling our base of high-quality fiber assets. In
addition, the combination of CBTS and OnX positions us as a leading IT
solutions provider for next-generation cloud-based products and
services. We look forward to building on the strategic milestones
achieved in 2017 to deliver long-term value for our shareholders and
customers."
Conference Call/Webcast
Cincinnati Bell will host a conference call on February 15, 2018 at
10:00 a.m. (ET) to discuss its results for the fourth quarter and full
year of 2017. A live webcast of the call will be available via the
Investor Relations section of www.cincinnatibell.com.
The conference call dial-in number is 877-795-3635. Callers located
outside of the U.S. and Canada may dial 719-325-2215. To participate,
please call 15 minutes prior to the start time. A taped replay of the
conference call will be available approximately one hour after the
conclusion of the call until 1:00 p.m. (ET) on Thursday, March 1, 2018.
For U.S. callers, the replay will be available at 888-203-1112. For
callers outside of the U.S. and Canada, the replay will be available at
719-457-0820. The replay reference number is 9458851. An archived
version of the webcast will also be available in the Investor Relations
section of www.cincinnatibell.com.
Safe Harbor Note
This release may contain "forward-looking" statements, as defined in
federal securities laws including the Private Securities Litigation
Reform Act of 1995, which are based on our current expectations,
estimates, forecasts and projections. Statements that are not historical
facts, including statements about the beliefs, expectations and future
plans and strategies of the Company, are forward-looking statements.
Actual results may differ materially from those expressed in any
forward-looking statements. The following important factors, among other
things, could cause or contribute to actual results being materially and
adversely different from those described or implied by such
forward-looking statements including, but not limited to: those
discussed in this release; we operate in highly competitive industries,
and customers may not continue to purchase products or services, which
would result in reduced revenue and loss of market share; we may be
unable to grow our revenues and cash flows despite the initiatives we
have implemented; failure to anticipate the need for and introduce new
products and services or to compete with new technologies may compromise
our success in the telecommunications industry; our access lines, which
generate a significant portion of our cash flows and profits, are
decreasing in number and if we continue to experience access line losses
similar to the past several years, our revenues, earnings and cash flows
from operations may be adversely impacted; our failure to meet
performance standards under our agreements could result in customers
terminating their relationships with us or customers being entitled to
receive financial compensation, which would lead to reduced revenues
and/or increased costs; we generate a substantial portion of our revenue
by serving a limited geographic area; a large customer accounts for a
significant portion of our revenues and accounts receivable and the loss
or significant reduction in business from this customer would cause
operating revenues to decline and could negatively impact profitability
and cash flows; maintaining our telecommunications networks requires
significant capital expenditures, and our inability or failure to
maintain our telecommunications networks could have a material impact on
our market share and ability to generate revenue; increases in broadband
usage may cause network capacity limitations, resulting in service
disruptions or reduced capacity for customers; we may be liable for
material that content providers distribute on our networks; cyber
attacks or other breaches of network or other information technology
security could have an adverse effect on our business; natural
disasters, terrorists acts or acts of war could cause damage to our
infrastructure and result in significant disruptions to our operations;
the regulation of our businesses by federal and state authorities may,
among other things, place us at a competitive disadvantage, restrict our
ability to price our products and services and threaten our operating
licenses; we depend on a number of third party providers, and the loss
of, or problems with, one or more of these providers may impede our
growth or cause us to lose customers; a failure of back-office
information technology systems could adversely affect our results of
operations and financial condition; if we fail to extend or renegotiate
our collective bargaining agreements with our labor union when they
expire or if our unionized employees were to engage in a strike or other
work stoppage, our business and operating results could be materially
harmed; the loss of any of the senior management team or attrition among
key sales associates could adversely affect our business, financial
condition, results of operations and cash flows; our debt could limit
our ability to fund operations, raise additional capital, and fulfill
our obligations, which, in turn, would have a material adverse effect on
our businesses and prospects generally; our indebtedness imposes
significant restrictions on us; we depend on our loans and credit
facilities to provide for our short-term financing requirements in
excess of amounts generated by operations, and the availability of those
funds may be reduced or limited; the servicing of our indebtedness is
dependent on our ability to generate cash, which could be impacted by
many factors beyond our control; we depend on the receipt of dividends
or other intercompany transfers from our subsidiaries and investments;
the trading price of our common shares may be volatile, and the value of
an investment in our common shares may decline; the uncertain economic
environment, including uncertainty in the U.S. and world securities
markets, could impact our business and financial condition; our future
cash flows could be adversely affected if it is unable to fully realize
our deferred tax assets; adverse changes in the value of assets or
obligations associated with our employee benefit plans could negatively
impact shareowners' deficit and liquidity; third parties may claim that
we are infringing upon their intellectual property, and we could suffer
significant litigation or licensing expenses or be prevented from
selling products; third parties may infringe upon our intellectual
property, and we may expend significant resources enforcing our rights
or suffer competitive injury; we could be subject to a significant
amount of litigation, which could require us to pay significant damages
or settlements; we could incur significant costs resulting from
complying with, or potential violations of, environmental, health and
human safety laws; the timing and likelihood of completing the merger
with Hawaiian Telcom, including the timing, receipt and terms and
conditions of any required governmental and regulatory approvals for the
proposed transaction that could reduce anticipated benefits or cause the
parties to abandon the transaction; the possibility that competing
offers or acquisition proposals for Hawaiian Telcom will be made; the
occurrence of any event, change or other circumstance that could give
rise to the termination of the proposed transaction; the possibility
that the expected synergies and value creation from the proposed
transaction involving Hawaiian Telcom will not be realized or will not
be realized within the expected time period; the risk that the
businesses of the Company and Hawaiian Telcom and other acquired
companies will not be integrated successfully; disruption from the
proposed transaction involving Hawaiian Telcom making it more difficult
to maintain business and operational relationships; the risk that
unexpected costs will be incurred; and the possibility that the proposed
transaction involving Hawaiian Telcom does not close, including due to
the failure to satisfy the closing conditions and the other risks and
uncertainties detailed in our filings, including our Form 10-K, with the
SEC as well as Hawaiian Telcom's filings, including its Form 10-K, with
the SEC.
These forward-looking statements are based on information, plans and
estimates as of the date hereof and there may be other factors that may
cause our actual results to differ materially from these forward-looking
statements. We assume no obligation to update the information contained
in this release except as required by applicable law.
Use of Non-GAAP Financial Measures
This press release contains information about adjusted earnings before
interest, taxes, depreciation and amortization (Adjusted EBITDA),
Adjusted EBITDA margin, net debt, net income applicable to common
shareholders excluding special items and free cash flow. These are
non-GAAP financial measures used by Cincinnati Bell management when
evaluating results of operations and cash flow. Management believes
these measures also provide users of the financial statements with
additional and useful comparisons of current results of operations and
cash flows with past and future periods. Non-GAAP financial measures
should not be construed as being more important than comparable GAAP
measures. Detailed reconciliations of these non-GAAP financial measures
to comparable GAAP financial measures have been included in the tables
distributed with this release and are available in the Investor
Relations section of www.cincinnatibell.com.
1Adjusted EBITDA provides a useful measure of
operational performance. The company defines Adjusted EBITDA as GAAP
operating income plus depreciation, amortization, restructuring and
severance related charges, (gain) loss on sale or disposal of assets,
transaction and integration costs, curtailment (gain) loss, asset
impairments, components of pension and other retirement plan costs
(including interest costs, asset returns, and amortization of actuarial
gains and losses), and other special items. Adjusted EBITDA should not
be considered as an alternative to comparable GAAP measures of
profitability and may not be comparable with the measure as defined by
other companies.
Adjusted EBITDA margin provides a useful measure of operational
performance. The company defines Adjusted EBITDA margin as Adjusted
EBITDA divided by revenue. Adjusted EBITDA margin should not be
considered as an alternative to comparable GAAP measures of
profitability and may not be comparable with the measure as defined by
other companies.
2Free cash flow provides a useful measure of
operational performance, liquidity and financial health. The company
defines free cash flow as cash provided by (used in) operating
activities, adjusted for capital expenditures, restructuring and
severance related payments, transaction and integration payments,
preferred stock dividends, dividends received from CyrusOne, and cash
used in or (provided by) discontinued operations, including the
decommission of wireless towers. Free cash flow should not be considered
as an alternative to net income (loss), operating income (loss), cash
flow from operating activities, or the change in cash on the balance
sheet and may not be comparable with free cash flow as defined by other
companies. Although the company feels there is no comparable GAAP
measure for free cash flow, the attached financial information
reconciles cash provided by operating activities to free cash flow.
Net debt provides a useful measure of liquidity and financial
health. The company defines net debt as the sum of the face amount of
short-term and long-term debt, unamortized premium and/or discount and
unamortized note issuance costs, offset by cash and cash equivalents.
Net income (loss) applicable to common shareholders excluding special
items in total and per share provides a useful measure of operating
performance. Net income (loss) applicable to common shareholders
excluding special items should not be considered as an alternative to
comparable GAAP measures of profitability and may not be comparable with
net income (loss) excluding special items as defined by other companies.
About Cincinnati Bell Inc.
With headquarters in Cincinnati, Ohio, Cincinnati Bell Inc. (NYSE:CBB)
provides integrated communications solutions - including local and long
distance voice, data, high-speed Internet and video - that keep
residential and business customers in Greater Cincinnati and Dayton
connected with each other and with the world. In addition, enterprise
customers across the United States and Canada rely on CBTS and OnX,
wholly-owned subsidiaries, for efficient, scalable office communications
systems and end-to-end IT solutions. For more information, please visit www.cincinnatibell.com.
The information on the Company's website is not incorporated by
reference in this press release.
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Cincinnati Bell Inc.
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Consolidated Statements of Operations
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(Unaudited)
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(Dollars in millions, except per share amounts)
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Three Months Ended
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Twelve Months Ended
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December 31,
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Change
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December 31,
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Change
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2017
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2016
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$
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%
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2017
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2016
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$
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%
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Revenue
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$
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427.1
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$
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285.3
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$
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141.8
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50%
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$
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1,288.5
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$
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1,185.8
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$
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102.7
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9%
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Costs and expenses
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Cost of services and products
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278.5
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161.6
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116.9
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72%
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761.3
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678.9
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82.4
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12%
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Selling, general and administrative
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74.3
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53.8
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20.5
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38%
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240.9
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218.7
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22.2
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10%
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Depreciation and amortization
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52.9
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47.5
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5.4
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11%
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193.0
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182.2
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10.8
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6%
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Restructuring and severance related charges
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3.5
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11.9
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(8.4
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(71)%
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32.7
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11.9
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20.8
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n/m
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Transaction and integration costs
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4.1
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-
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4.1
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n/m
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18.5
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-
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18.5
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n/m
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Other
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4.0
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-
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4.0
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n/m
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4.0
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1.1
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2.9
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n/m
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Operating income
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9.8
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10.5
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(0.7
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(7)%
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38.1
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93.0
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(54.9
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(59)%
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Interest expense
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30.3
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17.6
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12.7
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72%
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85.2
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75.7
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9.5
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13%
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Loss on extinguishment of debt, net
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3.2
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4.8
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(1.6
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(33)%
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3.2
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19.0
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(15.8
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(83)%
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Gain on sale of Investment in CyrusOne
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-
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(5.1
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5.1
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n/m
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(117.7
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(157.0
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39.3
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(25)%
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Other (income) expense, net
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(2.1
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(6.4
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4.3
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(67)%
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1.4
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(7.6
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9
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n/m
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(Loss) income from continuing operations before income taxes
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(21.6
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(0.4
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(21.2
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n/m
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66.0
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162.9
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(96.9
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(59)%
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Income tax (benefit) expense
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(5.4
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1.2
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(6.6
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n/m
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30.9
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61.1
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(30.2
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(49)%
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(Loss) income from continuing operations
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(16.2
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(1.6
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(14.6
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n/m
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35.1
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101.8
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(66.7
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(66)%
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Income from discontinued operations, net of tax
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-
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0.3
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(0.3
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n/m
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-
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0.3
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(0.3
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n/m
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Net (loss) income
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(16.2
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(1.3
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(14.9
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n/m
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35.1
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102.1
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(67.0
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(66)%
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|
|
Preferred stock dividends
|
|
2.6
|
|
|
2.6
|
|
|
-
|
|
|
0%
|
|
10.4
|
|
|
10.4
|
|
|
-
|
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income applicable to common shareowners
|
|
$
|
(18.8
|
)
|
|
$
|
(3.9
|
)
|
|
$
|
(14.9
|
)
|
|
n/m
|
|
$
|
24.7
|
|
|
$
|
91.7
|
|
|
$
|
(67.0
|
)
|
|
(73)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net (loss) earnings per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings from continuing operations
|
|
$
|
(0.45
|
)
|
|
$
|
(0.10
|
)
|
|
|
|
|
|
$
|
0.59
|
|
|
$
|
2.17
|
|
|
|
|
|
|
|
|
Earnings from discontinued operations
|
|
$
|
-
|
|
|
$
|
0.01
|
|
|
|
|
|
|
$
|
-
|
|
|
$
|
0.01
|
|
|
|
|
|
|
Basic net (loss) earnings per common share
|
|
$
|
(0.45
|
)
|
|
$
|
(0.09
|
)
|
|
|
|
|
|
$
|
0.59
|
|
|
$
|
2.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net (loss) earnings per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings from continuing operations
|
|
$
|
(0.45
|
)
|
|
$
|
(0.10
|
)
|
|
|
|
|
|
$
|
0.58
|
|
|
$
|
2.17
|
|
|
|
|
|
|
|
|
Earnings from discontinued operations
|
|
$
|
-
|
|
|
$
|
0.01
|
|
|
|
|
|
|
$
|
-
|
|
|
$
|
0.01
|
|
|
|
|
|
|
Diluted net (loss) earnings per common share
|
|
$
|
(0.45
|
)
|
|
$
|
(0.09
|
)
|
|
|
|
|
|
$
|
0.58
|
|
|
$
|
2.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Basic
|
|
42.2
|
|
|
42.0
|
|
|
|
|
|
|
42.2
|
|
|
42.0
|
|
|
|
|
|
|
|
- Diluted
|
|
42.2
|
|
|
42.0
|
|
|
|
|
|
|
42.4
|
|
|
42.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
Change
|
|
December 31,
|
|
Change
|
|
|
|
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
2017
|
|
2016
|
|
$
|
|
%
|
Entertainment and Communications
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
$
|
32.6
|
|
|
$
|
27.8
|
|
|
$
|
4.8
|
|
|
17%
|
|
$
|
125.8
|
|
|
$
|
103.0
|
|
|
$
|
22.8
|
|
|
22%
|
|
|
|
Voice
|
|
6.2
|
|
|
5.7
|
|
|
0.5
|
|
|
9%
|
|
24.4
|
|
|
21.7
|
|
|
2.7
|
|
|
12%
|
|
|
|
Video
|
|
37.6
|
|
|
33.0
|
|
|
4.6
|
|
|
14%
|
|
146.7
|
|
|
123.6
|
|
|
23.1
|
|
|
19%
|
|
|
|
Services and other
|
|
0.4
|
|
|
0.8
|
|
|
(0.4
|
)
|
|
(50)%
|
|
1.6
|
|
|
3.4
|
|
|
(1.8
|
)
|
|
(53)%
|
|
|
|
|
|
76.8
|
|
|
67.3
|
|
|
9.5
|
|
|
14%
|
|
298.5
|
|
|
251.7
|
|
|
46.8
|
|
|
19%
|
|
|
Legacy
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
7.9
|
|
|
9.8
|
|
|
(1.9
|
)
|
|
(19)%
|
|
34.9
|
|
|
44.2
|
|
|
(9.3
|
)
|
|
(21)%
|
|
|
|
Voice
|
|
15.5
|
|
|
17.1
|
|
|
(1.6
|
)
|
|
(9)%
|
|
66.3
|
|
|
73.8
|
|
|
(7.5
|
)
|
|
(10)%
|
|
|
|
Services and other
|
|
1.1
|
|
|
0.9
|
|
|
0.2
|
|
|
22%
|
|
3.3
|
|
|
4.1
|
|
|
(0.8
|
)
|
|
(20)%
|
|
|
|
|
|
24.5
|
|
|
27.8
|
|
|
(3.3
|
)
|
|
(12)%
|
|
104.5
|
|
|
122.1
|
|
|
(17.6
|
)
|
|
(14)%
|
|
|
Integration
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services and other
|
|
0.4
|
|
|
0.9
|
|
|
(0.5
|
)
|
|
(56)%
|
|
0.7
|
|
|
3.9
|
|
|
(3.2
|
)
|
|
(82)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total consumer revenue
|
|
$
|
101.7
|
|
|
$
|
96.0
|
|
|
$
|
5.7
|
|
|
6%
|
|
$
|
403.7
|
|
|
$
|
377.7
|
|
|
$
|
26.0
|
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
$
|
25.6
|
|
|
$
|
24.6
|
|
|
$
|
1.0
|
|
|
4%
|
|
100.5
|
|
|
$
|
96.5
|
|
|
$
|
4.0
|
|
|
4%
|
|
|
|
Voice
|
|
17.0
|
|
|
13.9
|
|
|
3.1
|
|
|
22%
|
|
63.3
|
|
|
51.7
|
|
|
11.6
|
|
|
22%
|
|
|
|
Video
|
|
0.6
|
|
|
0.6
|
|
|
-
|
|
|
0%
|
|
2.5
|
|
|
2.1
|
|
|
0.4
|
|
|
19%
|
|
|
|
Services and other
|
|
0.4
|
|
|
1.0
|
|
|
(0.6
|
)
|
|
(60)%
|
|
2.0
|
|
|
2.5
|
|
|
(0.5
|
)
|
|
(20)%
|
|
|
|
|
|
43.6
|
|
|
40.1
|
|
|
3.5
|
|
|
9%
|
|
168.3
|
|
|
152.8
|
|
|
15.5
|
|
|
10%
|
|
|
Legacy
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
3.8
|
|
|
4.9
|
|
|
(1.1
|
)
|
|
(22)%
|
|
17.1
|
|
|
20.3
|
|
|
(3.2
|
)
|
|
(16)%
|
|
|
|
Voice
|
|
23.4
|
|
|
26.4
|
|
|
(3.0
|
)
|
|
(11)%
|
|
97.9
|
|
|
111.5
|
|
|
(13.6
|
)
|
|
(12)%
|
|
|
|
Services and other
|
|
0.5
|
|
|
0.3
|
|
|
0.2
|
|
|
67%
|
|
1.1
|
|
|
1.3
|
|
|
(0.2
|
)
|
|
(15)%
|
|
|
|
|
|
27.7
|
|
|
31.6
|
|
|
(3.9
|
)
|
|
(12)%
|
|
116.1
|
|
|
133.1
|
|
|
(17.0
|
)
|
|
(13)%
|
|
|
Integration
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services and other
|
|
0.4
|
|
|
0.5
|
|
|
(0.1
|
)
|
|
(20)%
|
|
1.5
|
|
|
1.8
|
|
|
(0.3
|
)
|
|
(17)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total business revenue
|
|
$
|
71.7
|
|
|
$
|
72.2
|
|
|
$
|
(0.5
|
)
|
|
(1)%
|
|
$
|
285.9
|
|
|
$
|
287.7
|
|
|
$
|
(1.8
|
)
|
|
(1)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carrier
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
$
|
11.3
|
|
|
$
|
11.1
|
|
|
$
|
0.2
|
|
|
2%
|
|
$
|
42.8
|
|
|
$
|
45.0
|
|
|
$
|
(2.2
|
)
|
|
(5)%
|
|
|
|
Services and other
|
|
-
|
|
|
-
|
|
|
-
|
|
|
n/m
|
|
5.4
|
|
|
-
|
|
|
5.4
|
|
|
n/m
|
|
|
|
|
|
11.3
|
|
|
11.1
|
|
|
0.2
|
|
|
2%
|
|
48.2
|
|
|
45.0
|
|
|
3.2
|
|
|
7%
|
|
|
Legacy
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
7.1
|
|
|
8.2
|
|
|
(1.1
|
)
|
|
(13)%
|
|
30.5
|
|
|
35.8
|
|
|
(5.3
|
)
|
|
(15)%
|
|
|
|
Voice
|
|
3.7
|
|
|
3.9
|
|
|
(0.2
|
)
|
|
(5)%
|
|
15.4
|
|
|
16.3
|
|
|
(0.9
|
)
|
|
(6)%
|
|
|
|
Services and other
|
|
1.5
|
|
|
1.6
|
|
|
(0.1
|
)
|
|
(6)%
|
|
6.2
|
|
|
6.3
|
|
|
(0.1
|
)
|
|
(2)%
|
|
|
|
|
|
12.3
|
|
|
13.7
|
|
|
(1.4
|
)
|
|
(10)%
|
|
52.1
|
|
|
58.4
|
|
|
(6.3
|
)
|
|
(11)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total carrier revenue
|
|
$
|
23.6
|
|
|
$
|
24.8
|
|
|
$
|
(1.2
|
)
|
|
(5)%
|
|
$
|
100.3
|
|
|
$
|
103.4
|
|
|
$
|
(3.1
|
)
|
|
(3)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Entertainment and Communications Revenue
|
|
$
|
197.0
|
|
|
$
|
193.0
|
|
|
$
|
4.0
|
|
|
2%
|
|
$
|
789.9
|
|
|
$
|
768.8
|
|
|
$
|
21.1
|
|
|
3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
Change
|
|
December 31,
|
|
Change
|
|
|
|
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
2017
|
|
2016
|
|
$
|
|
%
|
IT Services and Hardware
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional Services
|
|
$
|
41.3
|
|
|
$
|
20.9
|
|
|
$
|
20.4
|
|
|
98%
|
|
$
|
95.5
|
|
|
$
|
89.2
|
|
|
$
|
6.3
|
|
|
7%
|
|
|
|
Management and Monitoring
|
|
5.5
|
|
|
7.9
|
|
|
(2.4
|
)
|
|
(30)%
|
|
21.1
|
|
|
32.0
|
|
|
(10.9
|
)
|
|
(34)%
|
|
|
|
Unified Communications
|
|
7.4
|
|
|
7.3
|
|
|
0.1
|
|
|
1%
|
|
29.1
|
|
|
29.4
|
|
|
(0.3
|
)
|
|
(1)%
|
|
|
|
Cloud Services
|
|
17.3
|
|
|
13.3
|
|
|
4.0
|
|
|
30%
|
|
53.5
|
|
|
46.5
|
|
|
7.0
|
|
|
15%
|
|
|
|
|
|
71.5
|
|
|
49.4
|
|
|
22.1
|
|
|
45%
|
|
199.2
|
|
|
197.1
|
|
|
2.1
|
|
|
1%
|
|
|
Integration
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional Services
|
|
3.2
|
|
|
5.9
|
|
|
(2.7
|
)
|
|
(46)%
|
|
19.1
|
|
|
17.5
|
|
|
1.6
|
|
|
9%
|
|
|
|
Unified Communications
|
|
3.3
|
|
|
2.4
|
|
|
0.9
|
|
|
38%
|
|
13.2
|
|
|
10.4
|
|
|
2.8
|
|
|
27%
|
|
|
|
Telecom and IT hardware
|
|
155.3
|
|
|
37.8
|
|
|
117.5
|
|
|
n/m
|
|
280.3
|
|
|
205.7
|
|
|
74.6
|
|
|
36%
|
|
|
|
|
|
161.8
|
|
|
46.1
|
|
|
115.7
|
|
|
n/m
|
|
312.6
|
|
|
233.6
|
|
|
79.0
|
|
|
34%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total IT Services and Hardware Revenue
|
|
$
|
233.3
|
|
|
$
|
95.5
|
|
|
$
|
137.8
|
|
|
n/m
|
|
$
|
511.8
|
|
|
$
|
430.7
|
|
|
$
|
81.1
|
|
|
19%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Statements by Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
|
|
|
|
|
December 31,
|
|
Change
|
|
December 31,
|
|
Change
|
|
|
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
Entertainment and Communications
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data
|
|
$
|
88.3
|
|
|
$
|
86.4
|
|
|
$
|
1.9
|
|
|
2%
|
|
$
|
351.6
|
|
|
$
|
344.8
|
|
|
$
|
6.8
|
|
|
2%
|
|
|
Voice
|
|
65.8
|
|
|
67.0
|
|
|
(1.2
|
)
|
|
(2)%
|
|
$
|
267.3
|
|
|
275.0
|
|
|
(7.7
|
)
|
|
(3)%
|
|
|
Video
|
|
38.2
|
|
|
33.6
|
|
|
4.6
|
|
|
14%
|
|
$
|
149.2
|
|
|
125.7
|
|
|
23.5
|
|
|
19%
|
|
|
Services and Other
|
|
4.7
|
|
|
6.0
|
|
|
(1.3
|
)
|
|
(22)%
|
|
$
|
21.8
|
|
|
23.3
|
|
|
(1.5
|
)
|
|
(6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue
|
|
197.0
|
|
|
193.0
|
|
|
4.0
|
|
|
2%
|
|
$
|
789.9
|
|
|
768.8
|
|
|
21.1
|
|
|
3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services and products
|
|
96.7
|
|
|
92.4
|
|
|
4.3
|
|
|
5%
|
|
379.3
|
|
|
359.5
|
|
|
19.8
|
|
|
6%
|
|
|
Selling, general and administrative
|
|
34.2
|
|
|
34.5
|
|
|
(0.3
|
)
|
|
(1)%
|
|
138.7
|
|
|
141.6
|
|
|
(2.9
|
)
|
|
(2)%
|
|
|
Depreciation and amortization
|
|
45.6
|
|
|
43.8
|
|
|
1.8
|
|
|
4%
|
|
174.7
|
|
|
168.6
|
|
|
6.1
|
|
|
4%
|
|
|
Other*
|
|
5.0
|
|
|
7.7
|
|
|
(2.7
|
)
|
|
(35)%
|
|
31.9
|
|
|
8.5
|
|
|
23.4
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating costs and expenses
|
|
181.5
|
|
|
178.4
|
|
|
3.1
|
|
|
2%
|
|
724.6
|
|
|
678.2
|
|
|
46.4
|
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
15.5
|
|
|
$
|
14.6
|
|
|
$
|
0.9
|
|
|
6%
|
|
$
|
65.3
|
|
|
$
|
90.6
|
|
|
$
|
(25.3
|
)
|
|
(28)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IT Services and Hardware
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional Services
|
|
$
|
44.5
|
|
|
$
|
26.8
|
|
|
$
|
17.7
|
|
|
66%
|
|
$
|
114.6
|
|
|
$
|
106.7
|
|
|
$
|
7.9
|
|
|
7%
|
|
|
Management and Monitoring
|
|
5.5
|
|
|
7.9
|
|
|
(2.4
|
)
|
|
(30)%
|
|
21.1
|
|
|
32.0
|
|
|
(10.9
|
)
|
|
(34)%
|
|
|
Unified Communications
|
|
10.7
|
|
|
9.7
|
|
|
1.0
|
|
|
10%
|
|
42.3
|
|
|
39.8
|
|
|
2.5
|
|
|
6%
|
|
|
Cloud Services
|
|
17.3
|
|
|
13.3
|
|
|
4.0
|
|
|
30%
|
|
53.5
|
|
|
46.5
|
|
|
7.0
|
|
|
15%
|
|
|
Telecom and IT hardware
|
|
155.3
|
|
|
37.8
|
|
|
117.5
|
|
|
n/m
|
|
280.3
|
|
|
205.7
|
|
|
74.6
|
|
|
36%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue
|
|
233.3
|
|
|
95.5
|
|
|
137.8
|
|
|
n/m
|
|
511.8
|
|
|
430.7
|
|
|
81.1
|
|
|
19%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services and products
|
|
184.8
|
|
|
72.1
|
|
|
112.7
|
|
|
n/m
|
|
394.6
|
|
|
332.4
|
|
|
62.2
|
|
|
19%
|
|
|
Selling, general and administrative
|
|
36.1
|
|
|
15.1
|
|
|
21.0
|
|
|
n/m
|
|
83.7
|
|
|
58.0
|
|
|
25.7
|
|
|
44%
|
|
|
Depreciation and amortization
|
|
7.2
|
|
|
3.7
|
|
|
3.5
|
|
|
95%
|
|
18.1
|
|
|
13.5
|
|
|
4.6
|
|
|
34%
|
|
|
Other*
|
|
2.5
|
|
|
3.3
|
|
|
(0.8
|
)
|
|
(24)%
|
|
4.8
|
|
|
3.6
|
|
|
1.2
|
|
|
33%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating costs and expenses
|
|
230.6
|
|
|
94.2
|
|
|
136.4
|
|
|
n/m
|
|
501.2
|
|
|
407.5
|
|
|
93.7
|
|
|
23%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
2.7
|
|
|
$
|
1.3
|
|
|
$
|
1.4
|
|
|
n/m
|
|
$
|
10.6
|
|
|
$
|
23.2
|
|
|
$
|
(12.6
|
)
|
|
(54)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Other includes restructuring and severance related charges, and
pension settlement charges.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
|
|
|
|
|
December 31,
|
|
Change
|
|
December 31,
|
|
Change
|
|
|
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
2017
|
|
2016
|
|
$
|
|
%
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
|
$
|
197.0
|
|
|
$
|
193.0
|
|
|
$
|
4.0
|
|
|
2%
|
|
$
|
789.9
|
|
|
$
|
768.8
|
|
|
$
|
21.1
|
|
|
3%
|
|
|
IT Services and Hardware
|
|
233.3
|
|
|
95.5
|
|
|
137.8
|
|
|
n/m
|
|
511.8
|
|
|
430.7
|
|
|
81.1
|
|
|
19%
|
|
|
Eliminations
|
|
(3.2
|
)
|
|
(3.2
|
)
|
|
-
|
|
|
0%
|
|
(13.2
|
)
|
|
(13.7
|
)
|
|
0.5
|
|
|
(4)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue
|
|
$
|
427.1
|
|
|
$
|
285.3
|
|
|
$
|
141.8
|
|
|
50%
|
|
$
|
1,288.5
|
|
|
$
|
1,185.8
|
|
|
$
|
102.7
|
|
|
9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Services and Products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
|
$
|
96.7
|
|
|
$
|
92.4
|
|
|
$
|
4.3
|
|
|
5%
|
|
$
|
379.3
|
|
|
$
|
359.5
|
|
|
$
|
19.8
|
|
|
6%
|
|
|
IT Services and Hardware
|
|
184.8
|
|
|
72.1
|
|
|
112.7
|
|
|
n/m
|
|
394.6
|
|
|
332.4
|
|
|
62.2
|
|
|
19%
|
|
|
Eliminations
|
|
(3.0
|
)
|
|
(2.9
|
)
|
|
(0.1
|
)
|
|
3%
|
|
(12.6
|
)
|
|
(13.0
|
)
|
|
0.4
|
|
|
(3)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cost of services and products
|
|
$
|
278.5
|
|
|
$
|
161.6
|
|
|
$
|
116.9
|
|
|
72%
|
|
$
|
761.3
|
|
|
$
|
678.9
|
|
|
$
|
82.4
|
|
|
12%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, General and Administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
|
$
|
34.2
|
|
|
$
|
34.5
|
|
|
$
|
(0.3
|
)
|
|
(1)%
|
|
$
|
138.7
|
|
|
$
|
141.6
|
|
|
$
|
(2.9
|
)
|
|
(2)%
|
|
|
IT Services and Hardware
|
|
36.1
|
|
|
15.1
|
|
|
21.0
|
|
|
n/m
|
|
83.7
|
|
|
58.0
|
|
|
25.7
|
|
|
44%
|
|
|
Corporate and eliminations
|
|
4.0
|
|
|
4.2
|
|
|
(0.2
|
)
|
|
(5)%
|
|
18.5
|
|
|
19.1
|
|
|
(0.6
|
)
|
|
(3)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total selling, general and administrative
|
|
$
|
74.3
|
|
|
$
|
53.8
|
|
|
$
|
20.5
|
|
|
38%
|
|
$
|
240.9
|
|
|
$
|
218.7
|
|
|
$
|
22.2
|
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
|
$
|
45.6
|
|
|
$
|
43.8
|
|
|
$
|
1.8
|
|
|
4%
|
|
$
|
174.7
|
|
|
$
|
168.6
|
|
|
$
|
6.1
|
|
|
4%
|
|
|
IT Services and Hardware
|
|
7.2
|
|
|
3.7
|
|
|
3.5
|
|
|
95%
|
|
18.1
|
|
|
13.5
|
|
|
4.6
|
|
|
34%
|
|
|
Corporate
|
|
0.1
|
|
|
-
|
|
|
0.1
|
|
|
n/m
|
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total depreciation and amortization
|
|
$
|
52.9
|
|
|
$
|
47.5
|
|
|
$
|
5.4
|
|
|
11%
|
|
$
|
193.0
|
|
|
$
|
182.2
|
|
|
$
|
10.8
|
|
|
6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
|
$
|
5.0
|
|
|
$
|
7.7
|
|
|
$
|
(2.7
|
)
|
|
(35)%
|
|
$
|
31.9
|
|
|
$
|
8.5
|
|
|
$
|
23.4
|
|
|
n/m
|
|
|
IT Services and Hardware
|
|
2.5
|
|
|
3.3
|
|
|
(0.8
|
)
|
|
(24)%
|
|
4.8
|
|
|
3.6
|
|
|
1.2
|
|
|
33%
|
|
|
Corporate
|
|
4.1
|
|
|
0.9
|
|
|
3.2
|
|
|
n/m
|
|
18.5
|
|
|
0.9
|
|
|
17.6
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other
|
|
$
|
11.6
|
|
|
$
|
11.9
|
|
|
$
|
(0.3
|
)
|
|
(3)%
|
|
$
|
55.2
|
|
|
$
|
13.0
|
|
|
$
|
42.2
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
|
$
|
15.5
|
|
|
$
|
14.6
|
|
|
$
|
0.9
|
|
|
6%
|
|
$
|
65.3
|
|
|
$
|
90.6
|
|
|
$
|
(25.3
|
)
|
|
(28)%
|
|
|
IT Services and Hardware
|
|
2.7
|
|
|
1.3
|
|
|
1.4
|
|
|
n/m
|
|
10.6
|
|
|
23.2
|
|
|
(12.6
|
)
|
|
(54)%
|
|
|
Corporate
|
|
(8.4
|
)
|
|
(5.4
|
)
|
|
(3.0
|
)
|
|
56%
|
|
(37.8
|
)
|
|
(20.8
|
)
|
|
(17.0
|
)
|
|
82%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating income
|
|
$
|
9.8
|
|
|
$
|
10.5
|
|
|
$
|
(0.7
|
)
|
|
(7)%
|
|
$
|
38.1
|
|
|
$
|
93.0
|
|
|
$
|
(54.9
|
)
|
|
(59)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Other includes restructuring, severance related charges,
transaction costs and pension settlement charges.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
|
|
Segment Metric Information
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
|
|
|
2017
|
|
2017
|
|
2017
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential voice lines
|
|
|
|
|
|
|
|
|
|
|
|
|
Legacy voice lines
|
|
94.9
|
|
|
99.5
|
|
|
104.9
|
|
|
111.1
|
|
|
117.5
|
|
|
Total Strategic voice lines (Fioptics)
|
|
88.8
|
|
|
88.1
|
|
|
87.0
|
|
|
85.5
|
|
|
83.8
|
|
|
Total residential voice lines
|
|
183.7
|
|
|
187.6
|
|
|
191.9
|
|
|
196.6
|
|
|
201.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business voice lines
|
|
|
|
|
|
|
|
|
|
|
|
|
Legacy voice lines
|
|
167.1
|
|
|
172.1
|
|
|
177.3
|
|
|
183.9
|
|
|
190.7
|
|
|
Strategic voice lines**
|
|
166.0
|
|
|
151.9
|
|
|
146.2
|
|
|
136.4
|
|
|
131.7
|
|
|
Total business voice lines
|
|
333.1
|
|
|
324.0
|
|
|
323.5
|
|
|
320.3
|
|
|
322.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total voice lines
|
|
516.8
|
|
|
511.6
|
|
|
515.4
|
|
|
516.9
|
|
|
523.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long distance lines
|
|
293.6
|
|
|
299.1
|
|
|
304.3
|
|
|
311.0
|
|
|
317.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Internet subscribers
|
|
|
|
|
|
|
|
|
|
|
|
|
DSL
|
|
82.1
|
|
|
86.7
|
|
|
93.0
|
|
|
100.1
|
|
|
105.6
|
|
|
Fioptics Internet
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FTTH
|
|
179.8
|
|
|
174.2
|
|
|
168.1
|
|
|
160.3
|
|
|
151.6
|
|
|
|
FTTN
|
|
47.0
|
|
|
47.0
|
|
|
46.0
|
|
|
47.0
|
|
|
46.0
|
|
|
Total Fioptics Internet
|
|
226.6
|
|
|
221.2
|
|
|
214.1
|
|
|
207.3
|
|
|
197.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total internet subscribers
|
|
308.7
|
|
|
307.9
|
|
|
307.1
|
|
|
307.4
|
|
|
303.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fioptics video subscribers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FTTH
|
|
116.5
|
|
|
113.5
|
|
|
112.8
|
|
|
111.1
|
|
|
107.6
|
|
|
|
FTTN
|
|
30.0
|
|
|
30.0
|
|
|
30.0
|
|
|
30.0
|
|
|
30.0
|
|
Total Fioptics video subscribers
|
|
146.5
|
|
|
143.5
|
|
|
142.8
|
|
|
141.1
|
|
|
137.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fioptics units passed
|
|
|
|
|
|
|
|
|
|
|
|
|
FTTH
|
|
431.3
|
|
|
423.6
|
|
|
415.4
|
|
|
403.7
|
|
|
392.3
|
|
|
FTTN
|
|
140.9
|
|
|
141.1
|
|
|
141.3
|
|
|
141.5
|
|
|
141.1
|
|
Total Fioptics units passed
|
|
572.2
|
|
|
564.7
|
|
|
556.7
|
|
|
545.2
|
|
|
533.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Fiber to the Home (FTTH), Fiber to the Node (FTTN)
|
|
** Strategic voice lines include VoIP lines and Fioptics voice lines.
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
Net Debt (Non-GAAP) and Common Shares Outstanding
|
|
|
(Unaudited)
|
|
|
|
|
(Dollars and shares in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
|
|
|
|
|
Receivables Facility
|
|
$
|
-
|
|
|
$
|
89.5
|
|
Corporate Credit Agreement - Tranche B Term Loan due 2020
|
|
-
|
|
|
315.8
|
|
Corporate Credit Agreement - Tranche B Term Loan due 2024
|
|
600.0
|
|
|
-
|
|
7 1/4% Senior Notes due 2023
|
|
22.3
|
|
|
22.3
|
|
7% Senior Notes due 2024
|
|
625.0
|
|
|
625.0
|
|
8% Senior Notes due 2025
|
|
350.0
|
|
|
-
|
|
Cincinnati Bell Telephone Notes
|
|
87.9
|
|
|
87.9
|
|
Capital leases and other debt
|
|
82.9
|
|
|
69.5
|
|
Net unamortized premium
|
|
1.9
|
|
|
8.5
|
|
Unamortized note issuance costs
|
|
(22.3
|
)
|
|
(11.9
|
)
|
|
|
|
|
|
|
|
Total debt
|
|
1,747.7
|
|
|
1,206.6
|
|
|
|
|
|
|
|
Less: Cash and cash equivalents
|
|
(396.5
|
)
|
|
(9.7
|
)
|
|
|
|
|
|
|
|
Net debt (Non-GAAP: as defined by the company)
|
|
$
|
1,351.2
|
|
|
$
|
1,196.9
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Credit Agreement availability
|
|
$
|
200.0
|
|
|
$
|
150.0
|
|
|
|
|
|
|
|
Common shares outstanding
|
|
42.2
|
|
|
42.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, 2017
|
|
|
|
|
Entertainment & Communications
|
|
IT Services & Hardware
|
|
Corporate
|
|
Total Company
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss (GAAP)
|
|
|
|
|
|
|
|
$
|
(16.2
|
)
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
|
|
|
|
|
|
|
|
(5.4
|
)
|
|
|
Interest expense
|
|
|
|
|
|
|
|
30.3
|
|
|
|
Loss on extinguishment of debt, net
|
|
|
|
|
|
|
|
3.2
|
|
|
|
Other income, net
|
|
|
|
|
|
|
|
(2.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (GAAP)
|
|
$
|
15.5
|
|
|
$
|
2.7
|
|
|
$
|
(8.4
|
)
|
|
$
|
9.8
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
45.6
|
|
|
7.2
|
|
|
0.1
|
|
|
52.9
|
|
|
|
Restructuring and severance related charges
|
|
1.0
|
|
|
2.5
|
|
|
|
|
3.5
|
|
|
|
Transaction and integration costs
|
|
-
|
|
|
-
|
|
|
4.1
|
|
|
4.1
|
|
|
|
Pension settlement charges
|
|
4.0
|
|
|
-
|
|
|
-
|
|
|
4.0
|
|
|
|
Pension and other retirement plan expenses
|
|
3.7
|
|
|
-
|
|
|
0.4
|
|
|
4.1
|
|
|
Adjusted EBITDA (Non-GAAP)
|
|
$
|
69.8
|
|
|
$
|
12.4
|
|
|
$
|
(3.8
|
)
|
|
$
|
78.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin (Non-GAAP)
|
|
35
|
%
|
|
5
|
%
|
|
0
|
%
|
|
18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, 2016
|
|
|
|
|
Entertainment & Communications
|
|
IT Services & Hardware
|
|
Corporate
|
|
Total Company
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss (GAAP)
|
|
|
|
|
|
|
|
$
|
(1.3
|
)
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations, net of tax
|
|
|
|
|
|
|
|
0.3
|
|
|
Loss from continuing operations (GAAP)
|
|
|
|
|
|
|
|
(1.6
|
)
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
|
|
|
|
|
1.2
|
|
|
|
Interest expense
|
|
|
|
|
|
|
|
17.6
|
|
|
|
Gain on sale of Investment in CyrusOne
|
|
|
|
|
|
|
|
(5.1
|
)
|
|
|
Loss on extinguishment of debt, net
|
|
|
|
|
|
|
|
4.8
|
|
|
|
Other income, net
|
|
|
|
|
|
|
|
(6.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (GAAP)
|
|
$
|
14.6
|
|
|
$
|
1.3
|
|
|
$
|
(5.4
|
)
|
|
$
|
10.5
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
43.8
|
|
|
3.7
|
|
|
-
|
|
|
47.5
|
|
|
|
Restructuring and severance related charges
|
|
7.7
|
|
|
3.3
|
|
|
0.9
|
|
|
11.9
|
|
|
|
Pension and other retirement plan expenses
|
|
3.8
|
|
|
-
|
|
|
0.5
|
|
|
4.3
|
|
|
Adjusted EBITDA (Non-GAAP)
|
|
$
|
69.9
|
|
|
$
|
8.3
|
|
|
$
|
(4.0
|
)
|
|
$
|
74.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin (Non-GAAP)
|
|
36
|
%
|
|
9
|
%
|
|
0
|
%
|
|
26
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-year dollar change in Adjusted EBITDA
|
|
$
|
(0.1
|
)
|
|
$
|
4.1
|
|
|
$
|
0.2
|
|
|
$
|
4.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-year percentage change in Adjusted EBITDA
|
|
-
|
%
|
|
49
|
%
|
|
(5
|
)%
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, 2017
|
|
|
|
|
Entertainment & Communications
|
|
IT Services & Hardware
|
|
Corporate
|
|
Total Company
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (GAAP)
|
|
|
|
|
|
|
|
$
|
35.1
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
|
|
|
|
|
30.9
|
|
|
|
Interest expense
|
|
|
|
|
|
|
|
85.2
|
|
|
|
Gain on sale of Investment in CyrusOne
|
|
|
|
|
|
|
|
(117.7
|
)
|
|
|
Loss on extinguishment of debt, net
|
|
|
|
|
|
|
|
3.2
|
|
|
|
Other expense, net
|
|
|
|
|
|
|
|
1.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (GAAP)
|
|
$
|
65.3
|
|
|
$
|
10.6
|
|
|
$
|
(37.8
|
)
|
|
$
|
38.1
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
174.7
|
|
|
18.1
|
|
|
0.2
|
|
|
193.0
|
|
|
|
Restructuring and severance related charges
|
|
27.9
|
|
|
4.8
|
|
|
-
|
|
|
32.7
|
|
|
|
Transaction and integration costs
|
|
-
|
|
|
-
|
|
|
18.5
|
|
|
18.5
|
|
|
|
Pension settlement charges
|
|
4.0
|
|
|
-
|
|
|
-
|
|
|
4.0
|
|
|
|
Pension and other retirement plan expenses
|
|
14.6
|
|
|
-
|
|
|
1.8
|
|
|
16.4
|
|
|
Adjusted EBITDA (Non-GAAP)
|
|
$
|
286.5
|
|
|
$
|
33.5
|
|
|
$
|
(17.3
|
)
|
|
$
|
302.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin (Non-GAAP)
|
|
36
|
%
|
|
7
|
%
|
|
0
|
%
|
|
23
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, 2016
|
|
|
|
|
Entertainment and Communications
|
|
IT Services & Hardware
|
|
Corporate
|
|
Total Company
|
|
Net income (GAAP)
|
|
|
|
|
|
|
|
$
|
102.1
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations, net of tax
|
|
|
|
|
|
|
|
0.3
|
|
|
Income from continuing operations (GAAP)
|
|
|
|
|
|
|
|
101.8
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
|
|
|
|
|
61.1
|
|
|
|
Interest expense
|
|
|
|
|
|
|
|
75.7
|
|
|
|
Gain on sale of Investment in CyrusOne
|
|
|
|
|
|
|
|
(157.0
|
)
|
|
|
Loss on extinguishment of debt, net
|
|
|
|
|
|
|
|
19.0
|
|
|
|
Other income, net
|
|
|
|
|
|
|
|
(7.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (GAAP)
|
|
$
|
90.6
|
|
|
$
|
23.2
|
|
|
$
|
(20.8
|
)
|
|
$
|
93.0
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
168.6
|
|
|
13.5
|
|
|
0.1
|
|
|
182.2
|
|
|
|
Restructuring and severance related charges
|
|
7.7
|
|
|
3.3
|
|
|
0.9
|
|
|
11.9
|
|
|
|
Loss on sale or disposal of assets
|
|
0.8
|
|
|
0.3
|
|
|
-
|
|
|
1.1
|
|
|
|
Pension and other retirement plan expenses
|
|
15.1
|
|
|
-
|
|
|
1.9
|
|
|
17.0
|
|
|
Adjusted EBITDA (Non-GAAP)
|
|
$
|
282.8
|
|
|
$
|
40.3
|
|
|
$
|
(17.9
|
)
|
|
$
|
305.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin (Non-GAAP)
|
|
37
|
%
|
|
9
|
%
|
|
0
|
%
|
|
26
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-year dollar change in Adjusted EBITDA
|
|
$
|
3.7
|
|
|
$
|
(6.8
|
)
|
|
$
|
0.6
|
|
|
$
|
(2.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-year percentage change in Adjusted EBITDA
|
|
1
|
%
|
|
(17
|
)%
|
|
(3
|
)%
|
|
(1
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
Consolidated Statements of Cash Flows
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by operating activities
|
|
$
|
46.6
|
|
|
$
|
27.4
|
|
|
$
|
203.4
|
|
|
$
|
173.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
(62.3
|
)
|
|
(97.6
|
)
|
|
(210.5
|
)
|
|
(286.4
|
)
|
|
|
Proceeds from sale of Investment in CyrusOne
|
|
-
|
|
|
8.5
|
|
|
140.7
|
|
|
189.7
|
|
|
|
Acquisitions of businesses, net of cash acquired
|
|
(157.4
|
)
|
|
-
|
|
|
(167.0
|
)
|
|
-
|
|
|
|
Dividends received from Investment in CyrusOne (equity method
investment)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2.1
|
|
|
|
Other, net
|
|
(0.3
|
)
|
|
(0.1
|
)
|
|
-
|
|
|
(0.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash used in investing activities
|
|
(220.0
|
)
|
|
(89.2
|
)
|
|
(236.8
|
)
|
|
(95.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of long-term debt
|
|
943.0
|
|
|
210.0
|
|
|
943.0
|
|
|
635.0
|
|
|
|
Net increase (decrease) in corporate credit and receivables
facilities with initial maturities less than 90 days
|
|
-
|
|
|
66.0
|
|
|
(89.5
|
)
|
|
71.9
|
|
|
|
Repayment of debt
|
|
(396.6
|
)
|
|
(298.3
|
)
|
|
(403.0
|
)
|
|
(759.3
|
)
|
|
|
Debt issuance costs
|
|
(17.8
|
)
|
|
(2.7
|
)
|
|
(19.1
|
)
|
|
(11.1
|
)
|
|
|
Dividends paid on preferred stock
|
|
(2.6
|
)
|
|
(2.6
|
)
|
|
(10.4
|
)
|
|
(10.4
|
)
|
|
|
Common stock repurchase
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(4.8
|
)
|
|
|
Other, net
|
|
0.2
|
|
|
(0.1
|
)
|
|
(0.8
|
)
|
|
3.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by (used in) financing activities
|
|
526.2
|
|
|
(27.7
|
)
|
|
420.2
|
|
|
(75.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
352.8
|
|
|
(89.5
|
)
|
|
386.8
|
|
|
2.3
|
|
|
Cash, cash equivalents and restricted cash at beginning of period
|
|
43.7
|
|
|
99.2
|
|
|
9.7
|
|
|
7.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
396.5
|
|
|
$
|
9.7
|
|
|
$
|
396.5
|
|
|
$
|
9.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Cash Provided by Operating Activities (GAAP) to
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow (Non-GAAP)
|
|
|
|
|
|
|
|
|
|
Cash provided by operating activities
|
|
46.6
|
|
|
27.4
|
|
|
203.4
|
|
|
173.1
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
(62.3
|
)
|
|
(97.6
|
)
|
|
(210.5
|
)
|
|
(286.4
|
)
|
|
|
Restructuring and severance related payments
|
|
2.4
|
|
|
0.9
|
|
|
29.4
|
|
|
1.8
|
|
|
|
Preferred stock dividends
|
|
(2.6
|
)
|
|
(2.6
|
)
|
|
(10.4
|
)
|
|
(10.4
|
)
|
|
|
Dividends received from Investment in CyrusOne (equity method
investment)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2.1
|
|
|
|
Decommissioning of wireless towers
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1.9
|
|
|
|
Cash used by discontinued operations
|
|
-
|
|
|
0.1
|
|
|
-
|
|
|
5.1
|
|
|
|
Transaction and integration costs
|
|
7.2
|
|
|
-
|
|
|
16.1
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow (Non-GAAP)
|
|
$
|
(8.7
|
)
|
|
$
|
(71.8
|
)
|
|
$
|
28.0
|
|
|
$
|
(112.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax payments (refunds)
|
|
$
|
3.3
|
|
|
$
|
0.3
|
|
|
$
|
(12.9
|
)
|
|
$
|
1.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
Free Cash Flow (Non-GAAP)
|
|
|
(Unaudited)
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
Free Cash Flow (Non-GAAP) for the three months ended December 31,
2016
|
|
$
|
(71.8
|
)
|
|
|
|
|
|
Increase in Adjusted EBITDA (Non-GAAP)
|
|
4.2
|
|
|
Decrease in capital expenditures
|
|
35.3
|
|
|
Decrease in dividends received from Investment in CyrusOne
|
|
(1.2
|
)
|
|
Decrease in pension and postretirement payments and contributions
|
|
2.4
|
|
|
Change in working capital and other
|
|
22.4
|
|
|
|
|
|
|
Free Cash Flow (Non-GAAP) for the three months ended December 31,
2017
|
|
$
|
(8.7
|
)
|
|
|
|
|
|
Free Cash Flow (Non-GAAP) for the twelve months ended December
31, 2016
|
|
$
|
(112.8
|
)
|
|
|
|
|
|
Decrease in Adjusted EBITDA (Non-GAAP)
|
|
(2.5
|
)
|
|
Decrease in capital expenditures
|
|
75.9
|
|
|
Decrease in interest payments
|
|
5.4
|
|
|
Decrease in dividends received from Investment in CyrusOne
|
|
(6.3
|
)
|
|
Decrease in pension and postretirement payments and contributions
|
|
1.2
|
|
|
Change in working capital and other
|
|
67.1
|
|
|
|
|
|
|
Free Cash Flow (Non-GAAP) for the twelve months ended December
31, 2017
|
|
$
|
28.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
|
|
|
Capital Expenditures
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Dec. 31, 2017
|
|
Sep. 30, 2017
|
|
June 30, 2017
|
|
Mar. 31, 2017
|
|
Dec. 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment and Communications
|
$
|
57.5
|
|
|
$
|
41.4
|
|
|
$
|
48.0
|
|
|
$
|
49.5
|
|
|
$
|
93.8
|
IT Services and Hardware
|
4.8
|
|
|
1.6
|
|
|
2.1
|
|
|
5.6
|
|
|
3.8
|
Total capital expenditures
|
$
|
62.3
|
|
|
$
|
43.0
|
|
|
$
|
50.1
|
|
|
$
|
55.1
|
|
|
$
|
97.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
Reconciliation of Net (Loss) Income Applicable to Common
Shareholders (GAAP) to Net Income Applicable to Common
Shareholders, Excluding Special Items (Non-GAAP) and
Adjusted Diluted Earnings Per Share (Non-GAAP)
|
(Unaudited)
|
|
(Dollars in millions, except per share amounts)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
December 31, 2017
|
|
December 31, 2016
|
|
|
|
|
|
|
Net (loss) income applicable to common shareholders (GAAP)
|
|
$
|
(18.8
|
)
|
|
$
|
(3.9
|
)
|
|
|
|
|
|
|
Special items:
|
|
|
|
|
|
Loss on sale or disposal of assets
|
|
-
|
|
|
-
|
|
|
Transaction and integration costs
|
|
4.1
|
|
|
-
|
|
|
Restructuring and severance related charges
|
|
3.5
|
|
|
11.9
|
|
|
Loss on extinguishment of debt, net
|
|
3.2
|
|
|
4.8
|
|
|
Gain on sale of Investment in CyrusOne
|
|
-
|
|
|
(5.1
|
)
|
|
Impairment of equity method investment
|
|
-
|
|
|
-
|
|
|
Pension settlement charges
|
|
4.0
|
|
|
-
|
|
|
Other income, net
|
|
(0.7
|
)
|
|
(6.4
|
)
|
|
Income tax effect of special items *
|
|
(2.7
|
)
|
|
(0.5
|
)
|
Total special items
|
|
11.4
|
|
|
4.7
|
|
|
|
|
|
|
|
Less: income from discontinued operations, net of tax
|
|
$
|
-
|
|
|
$
|
0.3
|
|
|
|
|
|
|
|
Net (loss) income applicable to common shareowners, excluding
special items (Non-GAAP)
|
|
$
|
(7.4
|
)
|
|
$
|
0.5
|
|
|
|
|
|
|
|
Weighted average diluted shares outstanding
|
|
42.2
|
|
|
42.1
|
|
|
|
|
|
|
|
Diluted (loss) earnings per common share (GAAP)
|
|
$
|
(0.45
|
)
|
|
$
|
(0.09
|
)
|
|
|
|
|
|
|
Adjusted diluted earnings per common share (Non-GAAP)
|
|
$
|
(0.18
|
)
|
|
$
|
0.01
|
|
|
|
|
|
|
|
*
|
Special items have been tax effected such that the normalized
effective tax rate is 36% with the exception of transaction costs,
which are treated as a discrete item in the quarter incurred.
|
|
|
|
|
Cincinnati Bell Inc.
|
|
Reconciliation of Net Income Applicable to Common Shareholders
(GAAP) to Net Income Applicable to Common Shareholders, Excluding
Special Items (Non-GAAP) and Adjusted Diluted Earnings Per Share
(Non-GAAP)
|
(Unaudited)
|
|
(Dollars in millions, except per share amounts)
|
|
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
December 31, 2017
|
|
December 31, 2016
|
|
|
|
|
|
|
Net income applicable to common shareholders (GAAP)
|
|
$
|
24.7
|
|
|
$
|
91.7
|
|
|
|
|
|
|
|
Special items:
|
|
|
|
|
|
Restructuring and severance related charges
|
|
32.7
|
|
|
11.9
|
|
|
Loss on sale or disposal of assets
|
|
-
|
|
|
1.1
|
|
|
Transaction and integration costs
|
|
18.5
|
|
|
-
|
|
|
Loss on extinguishment of debt, net
|
|
3.2
|
|
|
19.0
|
|
|
Gain on sale of Investment in CyrusOne
|
|
(117.7
|
)
|
|
(157.0
|
)
|
|
Impairment of equity method investment
|
|
4.7
|
|
|
-
|
|
|
Pension settlement charges
|
|
4.0
|
|
|
-
|
|
|
Other income, net
|
|
(0.7
|
)
|
|
(7.5
|
)
|
|
Income tax effect of special items *
|
|
27.0
|
|
|
50.2
|
|
Total special items
|
|
(28.3
|
)
|
|
(82.3
|
)
|
|
|
|
|
|
Less: income from discontinued operations, net of tax
|
|
$
|
-
|
|
|
$
|
0.3
|
|
|
|
|
|
|
Net (loss) income applicable to common shareowners, excluding
special items (Non-GAAP)
|
|
$
|
(3.6
|
)
|
|
$
|
9.1
|
|
|
|
|
|
|
|
Weighted average diluted shares outstanding
|
|
42.4
|
|
|
42.1
|
|
|
|
|
|
|
|
Diluted (loss) earnings per common share (GAAP)
|
|
$
|
0.58
|
|
|
$
|
2.18
|
|
|
|
|
|
|
|
Adjusted (loss) diluted earnings per common share (Non-GAAP)
|
|
$
|
(0.08
|
)
|
|
$
|
0.22
|
|
|
|
|
|
|
|
*
|
Special items have been tax effected such that the normalized
effective tax rate is 36% with the exception of transaction costs,
which are treated as a discrete item in the quarter incurred.
|
|
|
|
|
|
|
|
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
|
Reconciliation of Operating Income (GAAP) Guidance to Adjusted
EBITDA (Non-GAAP) Guidance
|
|
|
(Unaudited)
|
|
|
|
|
(Dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Low
|
|
High
|
|
2018 Operating Income (GAAP) Guidance Range
|
|
$
|
90
|
|
|
$
|
110
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
215
|
|
|
210
|
|
Restructuring and severance related charges
|
|
10
|
|
|
5
|
|
Stock compensation expense
|
|
5
|
|
|
5
|
|
|
|
|
|
|
|
2018 Adjusted EBITDA (Non-GAAP) Guidance Range
|
|
$
|
320
|
|
|
$
|
330
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20180215005575/en/
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