<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1995 Commission file number 0-8621
------------------------------- -----------------------------
The Woodbury Telephone Company
------------------------------
(Exact name of registrant as specified in its charter)
Connecticut 06-0594990
--------------------------------------------------------------
State or other jurisdiction of (IRS Employer
incorporation or organization) ID Number)
299 Main Street South, Woodbury, Connecticut 06798
--------------------------------------------------
(Address of principal, executive offices)
(Zip Code)
Registrant's telephone number, including area code 203-263-2121
------------
Not Applicable
--------------
Former name, former address and former
fiscal year, if changed since
last report.
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
---- ----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at July 31, 1995
-------------------------------------------------------------------
Common Stock, par value 769,107
$2.50 per share
<PAGE>
THE WOODBURY TELEPHONE COMPANY
FORM 10-Q
INDEX
Page No.
--------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Condensed Balance Sheets -
June 30, 1995 and December 31, 1994 3-4
Condensed Statements of Income -
Six Months Ended June 30, 1995 and 1994 5
Condensed Statements of Income -
Three Months Ended June 30, 1995 and 1994 6
Condensed Statements of Cash Flows -
Six Months Ended June 30, 1995 and 1994 7
Notes to Condensed Financial Statements 8-9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
<PAGE>
THE WOODBURY TELEPHONE COMPANY
FORM 10-Q
FOR QUARTER ENDED JUNE 30, 1995
PART I
FINANCIAL INFORMATION
<PAGE>
<TABLE>
<CAPTION>
THE WOODBURY TELEPHONE COMPANY
CONDENSED BALANCE SHEETS
--------------------------------------------------------------------------------
June 30, 1995 December 31,
(Unaudited) 1994
--------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
--------------------------------------------------------------------------------
CURRENT ASSETS
--------------------------------------------------------------------------------
Cash & cash equivalents $ 1,884,758 $ 1,942,924
--------------------------------------------------------------------------------
Accounts receivable, less
allowance for losses of 1,686,144 1,765,155
$60,000
--------------------------------------------------------------------------------
Other receivables 1,146,035 1,260,337
--------------------------------------------------------------------------------
Materials & supplies, at cost 511,714 430,899
--------------------------------------------------------------------------------
Prepaid expenses 276,511 141,842
--------------------------------------------------------------------------------
Estimated income tax deposits 224,037 __________
in excess of current -------
provision
--------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 5,729,199 5,541,157
--------------------------------------------------------------------------------
TELEPHONE PLANT & OTHER PROPERTY
--------------------------------------------------------------------------------
In service 40,830,027 39,850,063
--------------------------------------------------------------------------------
Less accumulated 20,162,867 18,955,421
depreciation ---------- ----------
--------------------------------------------------------------------------------
20,667,160 20,894,642
--------------------------------------------------------------------------------
Other property 76,717 76,717
------ ------
--------------------------------------------------------------------------------
20,743,877 20,971,359
--------------------------------------------------------------------------------
OTHER ASSETS
--------------------------------------------------------------------------------
1% Investment in Springwich
Cellular Limited Partnership 535,068 535,068
--------------------------------------------------------------------------------
Deferred charges, less 551,924 623,642
accumulated amortization
--------------------------------------------------------------------------------
Regulatory asset 383,228 412,711
------- -------
--------------------------------------------------------------------------------
1,470,220 1,571,421
--------------------------------------------------------------------------------
$27,943,296 $28,083,937
=========== ===========
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE WOODBURY TELEPHONE COMPANY
CONDENSED BALANCE SHEETS-CONTINUED
--------------------------------------------------------------------------------
June 30, 1995 December 31,
(Unaudited) 1994
--------------------------------------------------------------------------------
<S> <C> <C>
LIABILITIES & SHAREHOLDERS'
EQUITY
--------------------------------------------------------------------------------
CURRENT LIABILITIES
--------------------------------------------------------------------------------
Accounts payable $ 1,729,971 $ 1,984,024
--------------------------------------------------------------------------------
Advance billings & customer 282,546 280,918
deposits
--------------------------------------------------------------------------------
Accrued interest 337,500 337,500
--------------------------------------------------------------------------------
Income taxes __________ 312,757
-------
--------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 2,350,017 2,915,199
--------------------------------------------------------------------------------
LONG-TERM DEBT 9,000,000 9,000,000
--------------------------------------------------------------------------------
DEFERRED CREDITS
--------------------------------------------------------------------------------
Income taxes 2,460,177 2,407,979
--------------------------------------------------------------------------------
Investment tax credits 312,114 348,114
--------------------------------------------------------------------------------
Regulatory liability 861,397 914,060
------- -------
--------------------------------------------------------------------------------
3,633,688 3,670,153
--------------------------------------------------------------------------------
OTHER LONG-TERM LIABILITIES 414,486 359,617
--------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
--------------------------------------------------------------------------------
Common Stock, par value
$2.50 per share, authorized
--------------------------------------------------------------------------------
1,250,000 shares, issued and
outstanding 769,107 shares 1,922,768 1,922,768
--------------------------------------------------------------------------------
Additional paid-in capital 1,475,394 1,475,394
--------------------------------------------------------------------------------
Retained earnings 9,146,943 8,740,806
--------- ---------
--------------------------------------------------------------------------------
12,545,105 12,138,968
---------- ----------
--------------------------------------------------------------------------------
See accompanying notes. $ 27,943,296 $ 28,083,937
=========== ===========
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE WOODBURY TELEPHONE COMPANY
CONDENSED STATEMENTS OF INCOME
(Unaudited)
Six Months Ended June 30:
--------------------------------------------------------------------------------
1995 1994
---- ----
--------------------------------------------------------------------------------
<S> <C> <C>
Operating revenues:
--------------------------------------------------------------------------------
Local service $ 1,506,556 $ 1,417,493
--------------------------------------------------------------------------------
Network service 4,373,849 4,148,082
--------------------------------------------------------------------------------
Other 465,882 494,732
--------------------------------------------------------------------------------
Provision for uncollectibles 37,146 6,244
(deduction) ------ -----
--------------------------------------------------------------------------------
6,309,141 6,054,063
--------------------------------------------------------------------------------
Operating expenses:
--------------------------------------------------------------------------------
Maintenance 1,396,580 1,340,692
--------------------------------------------------------------------------------
Depreciation and 1,377,441 1,271,593
amortization
--------------------------------------------------------------------------------
General office 624,114 647,694
--------------------------------------------------------------------------------
Commercial 687,597 720,579
--------------------------------------------------------------------------------
Other 439,719 428,382
------- -------
--------------------------------------------------------------------------------
4,525,451 4,408,940
--------- ---------
--------------------------------------------------------------------------------
1,783,690 1,645,123
--------------------------------------------------------------------------------
Other income:
--------------------------------------------------------------------------------
Rental of telephone 191,947 125,949
equipment & other, net
--------------------------------------------------------------------------------
Interest 62,172 41,292
------ ------
--------------------------------------------------------------------------------
254,119 167,241
------- -------
--------------------------------------------------------------------------------
2,037,809 1,812,364
--------------------------------------------------------------------------------
Interest expense 411,928 411,234
------- -------
--------------------------------------------------------------------------------
Income before income taxes 1,625,881 1,401,130
--------------------------------------------------------------------------------
Income taxes 635,222 536,556
------- -------
--------------------------------------------------------------------------------
NET INCOME $ 990,659 $ 864,574
======== ========
--------------------------------------------------------------------------------
Per share of common stock:
--------------------------------------------------------------------------------
Net income $ 1.29 $ 1.12
===== =====
--------------------------------------------------------------------------------
Dividends $ 0.76 $ 0.76
===== =====
--------------------------------------------------------------------------------
Average number of shares of
Common stock outstanding 769,107 769,107
--------------------------------------------------------------------------------
See accompanying notes.
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE WOODBURY TELEPHONE COMPANY
CONDENSED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended June 30:
--------------------------------------------------------------------------------
1995 1994
--------------------------------------------------------------------------------
<S> <C> <C>
Operating revenues:
--------------------------------------------------------------------------------
Local service $ 762,547 $ 721,786
--------------------------------------------------------------------------------
Network service 2,201,997 2,058,033
--------------------------------------------------------------------------------
Other 224,328 249,567
--------------------------------------------------------------------------------
Provision for 33,617 (901)
uncollectibles ------ -----
(deduction)
--------------------------------------------------------------------------------
3,155,255 3,030,287
--------------------------------------------------------------------------------
Operating expenses:
--------------------------------------------------------------------------------
Maintenance 700,065 710,433
--------------------------------------------------------------------------------
Depreciation and 692,845 640,566
amortization
--------------------------------------------------------------------------------
General office 312,477 291,245
--------------------------------------------------------------------------------
Commercial 354,779 388,245
--------------------------------------------------------------------------------
Other 219,153 218,914
------- -------
--------------------------------------------------------------------------------
2,279,319 2,249,403
--------- ---------
--------------------------------------------------------------------------------
875,936 780,884
--------------------------------------------------------------------------------
Other income:
--------------------------------------------------------------------------------
Rental of telephone 75,068 82,265
equipment & other, net
--------------------------------------------------------------------------------
Interest 31,642 20,583
------ ------
--------------------------------------------------------------------------------
106,710 102,848
------- -------
--------------------------------------------------------------------------------
982,646 883,732
--------------------------------------------------------------------------------
Interest expense 205,043 205,534
------- -------
--------------------------------------------------------------------------------
Income before income taxes 777,603 678,198
--------------------------------------------------------------------------------
Income taxes 310,559 220,385
------- -------
--------------------------------------------------------------------------------
NET INCOME $ 467,044 $ 457,813
---------------------------------------=========================================
Per share of common stock:
--------------------------------------------------------------------------------
Net income $ 0.61 $ 0.60
---------------------------------------=========================================
Dividends $ .38 $ .38
---------------------------------------=========================================
Average number of shares of
Common Stock outstanding 769,107 769,107
--------------------------------------------------------------------------------
See accompanying notes.
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE WOODBURY TELEPHONE COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended June 30:
--------------------------------------------------------------------------------
1995 1994
---- ----
--------------------------------------------------------------------------------
<S> <C> <C>
OPERATING ACTIVITIES:
--------------------------------------------------------------------------------
Net income $ 990,659 $ 864,573
--------------------------------------------------------------------------------
Depreciation 1,305,724 1,199,879
--------------------------------------------------------------------------------
Other, net (691,786) (375,181)
--------- ---------
--------------------------------------------------------------------------------
NET CASH PROVIDED BY 1,604,597 1,689,271
OPERATING ACTIVITIES
--------------------------------------------------------------------------------
INVESTING ACTIVITIES:
--------------------------------------------------------------------------------
Purchases of telephone (1,078,242) (1,194,166)
plant & other property
--------------------------------------------------------------------------------
NET CASH USED BY INVESTING
ACTIVITIES (1,078,242) (1,194,166)
--------------------------------------------------------------------------------
FINANCING ACTIVITIES:
--------------------------------------------------------------------------------
Dividends (584,521) (584,521)
--------- ---------
--------------------------------------------------------------------------------
NET CASH USED BY FINANCING
ACTIVITIES (584,521) (584,521)
--------- ---------
--------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (58,166) (89,416)
--------------------------------------------------------------------------------
Cash and cash equivalents at 1,942,924 2,154,497
beginning of period
--------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT $ 1,884,758 $ 2,065,081
END OF PERIOD ---------- ----------
--------------------------------------------------------------------------------
See accompanying notes.
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
THE WOODBURY TELEPHONE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1995
Note 1 - Basis of Presentation
The accompanying unaudited condensed financial statements of
The Woodbury Telephone Company (the Company) have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included. All
adjustments were of a normal recurring nature.
Operating results for the six-month period ended June 30, 1995
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1995. For further information, refer to the financial
statements and footnotes thereto included in the Company's annual report on Form
10-K for the year ended December 31, 1994.
The condensed balance sheet at December 31, 1994 has been
derived from the audited financial statements at that date.
<PAGE>
<TABLE>
<CAPTION>
THE WOODBURY TELEPHONE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
JUNE 30, 1995
Note 2 - Income Taxes
A reconciliation of the amount of income taxes based on the statutory
federal income tax rate to income taxes reflected
in operations follows:
Six-month period ended:
--------------------------------------------------------------------------------
June 30, 1995 June 30, 1994
--------------------------------------------------------------------------------
<S> <C> <C>
Amount based on statutory federal $ 552,800 $ 476,384
income tax rate
--------------------------------------------------------------------------------
State income taxes less federal 123,404 106,346
tax effect
--------------------------------------------------------------------------------
Investment tax credit (36,000) (36,000)
amortization
--------------------------------------------------------------------------------
Other (4,982) (10,174)
------- --------
--------------------------------------------------------------------------------
Income taxes $ 635,222 $ 536,556
======== ========
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
THE WOODBURY TELEPHONE COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Operating revenues increased by $255,078 (4.2%) and by $124,968 (4.1%) for the
six and three-month periods ended June 30, 1995, respectively over the
comparable 1994 periods. For each period the increase is largely due to more
favorable access charge settlements and a growth in the customer base.
Operating expenses increased by $116,511 (2.6%) for the six-month period ended
June 30, 1995 over the comparable 1994 period. The increase is largely due to an
increase in depreciation and amortization expense of $105,848 (8.3%), reflecting
increased investment in telephone plant in service. For the three-month period
ended June 30, 1995, operating expenses increased $29,916 (1.3%), over the
comparable period in 1994. A depreciation and amortization expense increase of
$52,279 (8.2%), was mitigated by a decline in all other operating expenses
combined of $22,363 (1.4%) for the period.
Other income increased for the six-month period ended June 30, 1995 by $86,878
(51.9%) compared to the comparable period ended June 30, 1994. The increase was
due primarily to increased charges for rental of equipment effective in May of
1994, and a higher rate of interest earned on temporary investments of the
Company's cash. For the three-month period ended June 30, 1995, compared to
1994, other income increased by $3,862 (3.8%). Higher interest earned on
temporary cash investments was partially offset by a decline in miscellaneous
sales of telephone equipment.
As of June 30, 1995, current assets exceeded current liabilities by $3,379,182,
an increase of $753,224 compared to December 31, 1994. Cash provided by
operating activities for the six months ended June 30, 1995 was $1,604,597, a
decrease of $84,674 from the comparable period for 1994. The Company anticipates
that available cash, including that provided by current operating activities,
will be sufficient to cover expenditures and dividends declared during the
remainder of 1995.
<PAGE>
THE WOODBURY TELEPHONE COMPANY
FORM 10-Q
FOR QUARTER ENDED JUNE 30, 1995
PART II
OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders.
-------------------------------------------------------------
On April 5, 1995, the Company held its meeting of shareholders. At the annual
meeting, the shareholders voted on (i) the election of three Class III directors
who will hold office until 1998 and until their successors are elected and
qualified, and (ii) the ratification of the selection of Ernst & Young LLP as
independent auditors for the calendar year 1995. The following sets forth the
results of such voting:
Total Voted Voted Broker
Votes For Against Nonvotes
(i) Election of Class III
Directors:
(a)Joyce M. Davis 659,448 654,304 5,144 0
(b)J.Garry Mitchell 659,448 658,934 514 0
(c)Donald E. Porter 659,448 656,549 2,899 0
Total Votes Votes
Votes For Against Abstentions
(ii)Independent
Auditors 659,448 654,137 325 4,986
<PAGE>
THE WOODBURY TELEPHONE COMPANY
FORM 10-Q
FOR QUARTER ENDED JUNE 30, 1995
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K - None.
-------------------------------------------------
The Company did not file any reports on Form 8-K during the six months ended
June 30, 1995.
<PAGE>
SIGNATURES
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.
THE WOODBURY TELEPHONE COMPANY
DATE _______________________ BY ____________________________
Donald E. Porter
President & Treasurer
DATE ______________________ BY ____________________________
William R. Platt
Controller
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> This schedule contains summary information
extracted from the unaudited Woodbury Telephone
Company Condensed Statements of Income for the
six months ended June 30, 1995, and the Condensed
Balance Sheets for the period ended June 30, 1995.
</LEGEND>
<MULTIPLIER> 0
<S> <C>
<PERIOD-TYPE> 3-Mos
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> APR-01-1995
<PERIOD-END> JUN-30-1995
<CASH> $1,884,758
<SECURITIES> 0
<RECEIVABLES> 1,746,144
<ALLOWANCES> (60,000)
<INVENTORY> 511,714
<CURRENT-ASSETS> 5,729,199
<PP&E> 40,830,027
<DEPRECIATION> (20,162,867)
<TOTAL-ASSETS> 27,943,296
<CURRENT-LIABILITIES> 2,350,017
<BONDS> 9,000,000
<COMMON> 1,922,768
0
0
<OTHER-SE> 10,622,337
<TOTAL-LIABILITY-AND-EQUITY> 27,943,296
<SALES> 89,942
<TOTAL-REVENUES> 6,691,479
<CGS> 55,404
<TOTAL-COSTS> 4,653,670
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 411,928
<INCOME-PRETAX> 1,625,881
<INCOME-TAX> 635,222
<INCOME-CONTINUING> 990,659
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 990,659
<EPS-PRIMARY> 1.29
<EPS-DILUTED> 1.29
</TABLE>
