<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma condensed consolidated financial
statements are based on the historical financial statements of CCIC and the
historical financial statements of the entities acquired by CCIC during the
periods presented, adjusted to give effect to the following transactions:
(1) our 1999 debt and equity offerings and the issuance of the convertible
preferred stock and warrants in the GE Capital transaction;
(2) the Bell Atlantic joint venture;
(3) the BellSouth transaction;
(4) the Powertel acquisition;
(5) the borrowings under the term loans in connection with the GTE
transaction;
(6) our 2000 debt offering; and
(7) the conversion of France Telecom's ownership interest in CCUK into
shares of our common stock and resulting roll-up of CCUK into CCIC.
The Unaudited Pro Forma Condensed Consolidated Statements of Operations for
the year ended December 31, 1999 and the nine months ended September 30, 2000
give effect to these transactions as if they had occurred as of January 1,
1999. The pro forma adjustments are described in the accompanying notes and are
based upon available information and certain assumptions that management
believes are reasonable. All of the above transactions are recorded in CCIC's
historical consolidated balance sheet as of September 30, 2000; accordingly, no
pro forma balance sheet is presented.
Included in the notes accompanying the pro forma financial statements are
tables summarizing the unaudited pro forma results of operations for CCIC and
its subsidiaries that are restricted by covenants in our high yield debt
instruments. These subsidiaries exclude our U.K. subsidiaries and the Bell
Atlantic joint venture, both of which are designated as unrestricted
subsidiaries under our high yield debt instruments.
The pro forma financial statements do not purport to represent what CCIC's
results of operations would actually have been had these transactions in fact
occurred on such date or to project CCIC's results of operations for any future
period. The pro forma financial statements should be read in conjunction with
the consolidated financial statements and related notes and "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
included in CCIC's most recent annual report on Form 10-K and quarterly report
on Form 10-Q.
The Bell Atlantic joint venture, the Powertel acquisition and the
acquisition of France Telecom's ownership interest in CCUK are accounted for
under the purchase method of accounting. The total purchase price for these
acquisitions has been allocated to the identifiable tangible and intangible
assets and liabilities of the applicable acquired business based upon CCIC's
estimate of their fair values with the remainder allocated to goodwill.
In July 2000, CCIC sold shares of its common stock and preferred stock in
concurrent underwritten public offerings. The effect of these offerings has not
been reflected in the Unaudited Pro Forma Condensed Consolidated Statements of
Operations.
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended December 31, 1999
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
Adjustments
for 1999
Adjustments Acquisitions
for and Bell Adjustments Adjustments Adjustments
Historical 1999 Historical 1999 South for 2000 for 2000 for CCUK
CCIC Offerings Acquisitions(c) Transaction Term Loans Debt Offering Consolidation
---------- ----------- --------------- ------------ ----------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenues:
Site rental and
broadcast
transmission...... $ 267,894 $ -- $ 5,569 $ 35,671 (d) $ -- $ -- $ --
Network services
and other......... 77,865 -- -- -- -- -- --
--------- -------- ------- -------- -------- --------- --------
Total net
revenues........ 345,759 -- 5,569 35,671 -- -- --
--------- -------- ------- -------- -------- --------- --------
Operating expenses:
Costs of
operations:
Site rental and
broadcast
transmission.... 114,436 -- 7,948 7,207 (e) -- -- --
Network services
and other....... 42,312 -- -- -- -- -- --
General and
administrative.... 43,823 -- -- 10,878 (f) -- -- --
Corporate
development....... 5,403 -- -- -- -- -- --
Restructuring
charges........... 5,645 -- -- -- -- -- --
Non-cash
compensation
charges........... 2,173 -- -- -- -- -- --
Depreciation and
amortization...... 130,106 -- 5,532 27,887 (g) -- -- 26,689 (l)
--------- -------- ------- -------- -------- --------- --------
343,898 -- 13,480 45,972 -- -- 26,689
--------- -------- ------- -------- -------- --------- --------
Operating income
(loss)............. 1,861 -- (7,911) (10,301) -- -- (26,689)
Other income
(expense):
Interest and
other income
(expense)......... 17,731 -- -- -- -- -- --
Interest expense
and amortization
of deferred
financing costs... (110,908) (36,947)(a) -- (4,428)(h) (47,250)(j) (12,291)(k) --
--------- -------- ------- -------- -------- --------- --------
Loss before income
taxes, minority
interests and
cumulative effect
of change in
accounting
principle.......... (91,316) (36,947) (7,911) (14,729) (47,250) (12,291) (26,689)
Provision for
income taxes....... (275) -- -- -- -- -- --
Minority
interests.......... (2,756) -- -- 1,224 (i) -- -- 3,835 (m)
--------- -------- ------- -------- -------- --------- --------
Loss before
cumulative effect
of change in
accounting
principle.......... (94,347) (36,947) (7,911) (13,505) (47,250) (12,291) (22,854)
Cumulative effect
of change in
accounting
principle for costs
of start-up
activities......... (2,414) -- -- -- -- -- --
--------- -------- ------- -------- -------- --------- --------
Net loss........... (96,761) (36,947) (7,911) (13,505) (47,250) (12,291) (22,854)
Dividends on
preferred stock.... (28,881) (14,916)(b) -- -- -- -- --
--------- -------- ------- -------- -------- --------- --------
Net loss after
deduction of
dividends on
preferred stock.... $(125,642) $(51,863) $(7,911) $(13,505) $(47,250) $(12,291) $(22,854)
========= ======== ======= ======== ======== ========= ========
Per common share--
basic and diluted:
Loss before
cumulative effect
of change in
accounting
principle.......... $ (0.94)
Cumulative effect
of change in
accounting
principle.......... (0.02)
---------
Net loss........... $ (0.96)
=========
Common shares
outstanding--basic
and diluted (in
thousands)......... 131,466
=========
<CAPTION>
Pro Forma
for 1999 and
2000
Transactions
and
Offerings
------------
<S> <C>
Net revenues:
Site rental and
broadcast
transmission...... $ 309,134
Network services
and other......... 77,865
------------
Total net
revenues........ 386,999
------------
Operating expenses:
Costs of
operations:
Site rental and
broadcast
transmission.... 129,591
Network services
and other....... 42,312
General and
administrative.... 54,701
Corporate
development....... 5,403
Restructuring
charges........... 5,645
Non-cash
compensation
charges........... 2,173
Depreciation and
amortization...... 190,214
------------
430,039
------------
Operating income
(loss)............. (43,040)
Other income
(expense):
Interest and
other income
(expense)......... 17,731
Interest expense
and amortization
of deferred
financing costs... (211,824)
------------
Loss before income
taxes, minority
interests and
cumulative effect
of change in
accounting
principle.......... (237,133)
Provision for
income taxes....... (275)
Minority
interests.......... 2,303
------------
Loss before
cumulative effect
of change in
accounting
principle.......... (235,105)
Cumulative effect
of change in
accounting
principle for costs
of start-up
activities......... (2,414)
------------
Net loss........... (237,519)
Dividends on
preferred stock.... (43,797)
------------
Net loss after
deduction of
dividends on
preferred stock.... $(281,316)
============
Per common share--
basic and diluted:
Loss before
cumulative effect
of change in
accounting
principle.......... $ (1.59)
Cumulative effect
of change in
accounting
principle.......... (0.01)
------------
Net loss........... $ (1.60)
============
Common shares
outstanding--basic
and diluted (in
thousands)......... 175,459
============
</TABLE>
See Notes to Unaudited Pro Forma Condensed Consolidated Statements of
Operations
<PAGE>
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Nine Months Ended September 30, 2000
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
Pro Forma
Adjustments Adjustments Adjustments for 2000
Historical for 2000 for 2000 for CCUK Transactions
CCIC Term Loans Debt Offering Consolidation and Offering
---------- ----------- ------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Net revenues:
Site rental and
broadcast
transmission........... $ 320,418 $ -- $ -- $ -- $ 320,418
Network services and
other.................. 126,774 -- -- -- 126,774
--------- -------- ------ -------- ---------
Total net revenues... 447,192 -- -- -- 447,192
--------- -------- ------ -------- ---------
Operating expenses:
Costs of operations:
Site rental and
broadcast
transmission......... 139,233 -- -- -- 139,233
Network services and
other................ 70,901 -- -- -- 70,901
General and
administrative......... 52,544 -- -- -- 52,544
Corporate
development............ 6,415 -- -- -- 6,415
Non-cash compensation
charges................ 1,619 -- -- -- 1,619
Depreciation and
amortization........... 167,365 -- -- 20,017 (l) 187,382
--------- -------- ------ -------- ---------
438,077 -- -- 20,017 458,094
--------- -------- ------ -------- ---------
Operating income
(loss).................. 9,115 -- -- (20,017) (10,902)
Other income (expense):
Interest and other
income (expense)....... 22,586 -- -- -- 22,586
Interest expense and
amortization of
deferred financing
costs.................. (173,987) (12,907)(j) 1,665(k) -- (185,229)
--------- -------- ------ -------- ---------
Income (loss) before
income taxes, minority
interests and
extraordinary item...... (142,286) (12,907) 1,665 (20,017) (173,545)
Provision for income
taxes................... (163) -- -- -- (163)
Minority interests...... (1,806) -- -- 2,333 (m) 527
--------- -------- ------ -------- ---------
Income (loss) before
extraordinary item...... (144,255) (12,907) 1,665 (17,684) (173,181)
Extraordinary item--loss
on early extinguishment
of debt................. (1,495) -- -- -- (1,495)
--------- -------- ------ -------- ---------
Net income (loss)....... (145,750) (12,907) 1,665 (17,684) (174,676)
Dividends on preferred
stock................... (39,571) -- -- -- (39,571)
--------- -------- ------ -------- ---------
Net income (loss) after
deduction of dividends
on preferred stock...... $(185,321) $(12,907) $1,665 $(17,684) $(214,247)
========= ======== ====== ======== =========
Per common share--basic
and diluted:
Loss before
extraordinary item..... $ (1.07) $ (1.15)
Extraordinary item..... (0.01) (0.01)
--------- ---------
Net loss............... $ (1.08) $ (1.16)
========= =========
Common shares
outstanding--basic and
diluted (in thousands).. 171,985 183,930
========= =========
</TABLE>
See Notes to Unaudited Pro Forma Condensed Consolidated Statements of
Operations
<PAGE>
Notes to Unaudited Pro Forma Condensed Consolidated Statements of Operations
(Dollars in thousands)
(a) Reflects:
(1) increase in interest expense as a result of the issuance of the notes
in the 1999 debt offerings of $36,132; and
(2) amortization of deferred financing costs related to the notes issued in
the 1999 debt offerings of $815.
(b) Reflects the increase in dividends attributable to the issuance of the
convertible preferred stock.
(c) Reflects:
(1) the historical results of operations of the tower operations
contributed to the Bell Atlantic joint venture, comprising net
revenues, costs of operations and depreciation and amortization of
$3,705, $5,359 and $1,899, respectively; and
(2) the historical results of operations of the tower operations acquired
in the Powertel acquisition, comprising net revenues, costs of
operations and depreciation and amortization of $1,864, $2,589 and
$3,633, respectively.
(d) Reflects:
(1) additional revenues to be recognized by the Bell Atlantic joint venture
under the global lease and the formation agreement of $8,092;
(2) additional revenues to be recognized by CCIC in connection with the
BellSouth transaction for the sublease of tower space by BellSouth,
including $16,842 in revenues to be received from BellSouth and $4,552
in revenues to be received from other tenants; and
(3) additional revenues to be recognized by CCIC in connection with the
Powertel acquisition under the master site agreements of $6,185.
(e) Reflects additional costs to be incurred for ground rents in connection
with the BellSouth agreement.
(f) We expect that the Bell Atlantic joint venture will incur incremental
operating expenses as a stand-alone entity. Such incremental expenses are
estimated to amount to approximately $1,313 for the year ended December 31,
1999. In addition, we expect that we will incur incremental operating
expenses as a result of the BellSouth transaction and the Powertel
acquisition. Such incremental expenses are estimated to amount to
approximately $9,565 for the year ended December 31, 1999. These
incremental operating expenses are based on management's best estimates
rather than any contractual obligations.
(g) Reflects the incremental depreciation of property and equipment as a result
of:
(1) the Bell Atlantic joint venture for $6,222;
(2) the BellSouth transaction for $19,282; and
(3) the Powertel acquisition for $2,383.
Property and equipment is being depreciated over twenty years.
(h) Reflects additional interest expense attributable to borrowings under the
credit facility entered into by the Bell Atlantic joint venture at a rate
of 9.25% per annum.
(i) Reflects the minority partner's 38.5% interest in the Bell Atlantic joint
venture's operations.
(j) Reflects:
(1) increase in interest expense as a result of borrowings under the term
loans of $46,875 for the year ended December 31, 1999 and $12,813 for
the nine months ended September 30, 2000; and
(2) amortization of deferred financing costs related to the term loans of
$375 for the year ended December 31, 1999 and $94 for the nine months
ended September 30, 2000.
<PAGE>
Borrowings under the term loans initially incurred interest at a rate of
10.06% per annum, with such interest rate increasing on a periodic basis.
(k) Reflects:
(1) increase in interest expense as a result of the issuance of the 10 3/4%
notes in the 2000 debt offering of $53,750 for the year ended December
31, 1999 and $26,278 for the nine months ended September 30, 2000;
(2) amortization of deferred financing costs related to the notes in the
2000 debt offering of $1,666 for the year ended December 31, 1999 and
$833 for the nine months ended September 30, 2000;
(3) decrease in interest expense as a result of the repayment of borrowings
under the term loans of $46,875 for the year ended December 31, 1999
and $28,776 for the nine months ended September 30, 2000; and
(4) the write-off of unamortized deferred financing costs related to the
term loans of $3,750 for the year ended December 31, 1999.
(l) Reflects the incremental amortization of goodwill as a result of the
increased ownership in CCUK. Goodwill is being amortized over twenty years.
(m) Reflects the elimination of minority interests related to CCUK's operations
as a result of CCUK becoming a wholly owned subsidiary of CCIC.
<PAGE>
The following tables summarize the unaudited pro forma results of operations
for the restricted group under our high yield debt instruments. The "Exclusion
of Unrestricted Subsidiaries" column reflects the results of operations for the
unrestricted subsidiaries as a reduction from the consolidated pro forma
amounts. Such information is not intended as an alternative measure of the
operating results as would be determined in accordance with generally accepted
accounting principles.
<TABLE>
<CAPTION>
Year Ended December 31, 1999
-------------------------------------------
Restricted Group
Pro Forma for Pro Forma for
1999 and 2000 Exclusion of 1999 and 2000
Transactions Unrestricted Transactions
and Offerings Subsidiaries and Offerings
------------- ------------ ----------------
<S> <C> <C> <C>
Net revenues:
Site rental and broadcast
transmission..................... $ 309,134 $(221,398) $ 87,736
Network services and other........ 77,865 (31,981) 45,884
--------- --------- ---------
Total net revenues.............. 386,999 (253,379) 133,620
--------- --------- ---------
Operating expenses:
Costs of operations:
Site rental and broadcast
transmission................... 129,591 (99,095) 30,496
Network services and other...... 42,312 (20,275) 22,037
General and administrative........ 54,701 (12,084) 42,617
Corporate development............. 5,403 (819) 4,584
Restructuring charges............. 5,645 -- 5,645
Non-cash compensation charges..... 2,173 (769) 1,404
Depreciation and amortization..... 190,214 (122,562) 67,652
--------- --------- ---------
430,039 (255,604) 174,435
--------- --------- ---------
Operating income (loss)............ (43,040) 2,225 (40,815)
Other income (expense):
Interest and other income
(expense)........................ 17,731 (7,797) 9,934
Interest expense and amortization
of deferred financing costs...... (211,824) 44,995 (166,829)
--------- --------- ---------
Income (loss) before income taxes,
minority interests and cumulative
effect of change in accounting
principle......................... (237,133) 39,423 (197,710)
Provision for income taxes......... (275) -- (275)
Minority interests................. 2,303 (2,303) --
--------- --------- ---------
Income (loss) before cumulative
effect of change in accounting
principle......................... (235,105) 37,120 (197,985)
Cumulative effect of change in
accounting principle for costs of
start-up activities............... (2,414) -- (2,414)
--------- --------- ---------
Net income (loss).................. (237,519) 37,120 (200,399)
Dividends on preferred stock....... (43,797) -- (43,797)
--------- --------- ---------
Net income (loss) after deduction
of dividends on preferred stock... $(281,316) $ 37,120 $(244,196)
========= ========= =========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Nine Months Ended September 30, 2000
------------------------------------------
Restricted Group
Pro Forma Pro Forma
for 2000 Exclusion of for 2000
Transactions Unrestricted Transactions
and Offering Subsidiaries and Offering
------------ ------------ ----------------
<S> <C> <C> <C>
Net revenues:
Site rental and broadcast
transmission..................... $ 320,418 $(189,351) $ 131,067
Network services and other........ 126,774 (38,894) 87,880
--------- --------- ---------
Total net revenues.............. 447,192 (228,245) 218,947
--------- --------- ---------
Operating expenses:
Costs of operations:
Site rental and broadcast
transmission................... 139,233 (83,652) 55,581
Network services and other...... 70,901 (25,499) 45,402
General and administrative........ 52,544 (10,708) 41,836
Corporate development............. 6,415 (660) 5,755
Non-cash compensation charges..... 1,619 (449) 1,170
Depreciation and amortization..... 187,382 (98,776) 88,606
--------- --------- ---------
458,094 (219,744) 238,350
--------- --------- ---------
Operating income (loss)............ (10,902) (8,501) (19,403)
Other income (expense):
Interest and other income
(expense)........................ 22,586 (1,155) 21,431
Interest expense and amortization
of deferred financing costs...... (185,229) 37,427 (147,802)
--------- --------- ---------
Income (loss) before income taxes,
minority interests and
extraordinary item................ (173,545) 27,771 (145,774)
Provision for income taxes......... (163) 145 (18)
Minority interests................. 527 1,817 2,344
--------- --------- ---------
Income (loss) before extraordinary
item.............................. (173,181) 29,733 (143,448)
Extraordinary item--loss on early
extinguishment of debt............ (1,495) -- (1,495)
--------- --------- ---------
Net income (loss).................. (174,676) 29,733 (144,943)
Dividends on preferred stock....... (39,571) -- (39,571)
--------- --------- ---------
Net income (loss) after deduction
of dividends on preferred stock... $(214,247) $ 29,733 $(184,514)
========= ========= =========
</TABLE>
