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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 11-K
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/x/ Annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934
For the Fiscal Year Ended December 31, 1998
OR
/ / Transition report pursuant to Section 15(d) of the Securities Exchange Act
of 1934
For the transition period from to
Commission file number 33-
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
Cox Communications, Inc.
Savings and Investment Plan
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
Cox Communications, Inc.
1400 Lake Hearn Drive
Atlanta, Georgia 30319
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<PAGE>
ITEMS 1 AND 2
FINANCIAL STATEMENTS
Page Number
In This Report
Independent Auditors' Report 3
Financial Statements as of December 31, 1998
and 1997 and for the years ended December 31,
1998 and 1997:
Statements of Net Assets Available for Benefits 4
Statements of Changes in Net Assets Available for Benefits 5
Notes to Financial Statements 6
Supplemental Schedules as of and for the
year ended December 31, 1998:
Item 27a - Schedule of Assets Held for Investment Purposes 12
Item 27d - Schedule of Reportable Transactions 13
Schedules required under the Employee Retirement Income Security Act of
1974,other than the schedules listed above, are omitted because of the absence
of the conditions under which they are required.
Signature 14
EXHIBIT
23 Consent of Deloitte & Touche LLP 15
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<PAGE>
INDEPENDENT AUDITORS' REPORT
Cox Communications, Inc. Savings and Investment Plan:
We have audited the accompanying statements of net assets available for
benefits of the Cox Communications, Inc. Savings and Investment Plan
(the "Plan") as of December 31, 1998 and 1997, and the related statements of
changes in net assets available for benefits for the years then ended. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1998 and 1997, and the changes in net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in the
Table of Contents are presented for the purpose of additional analysis and are
not a required part of the basic financial statements, but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974. These schedules are the responsibility of the Plan's management.
Such schedules have been subjected to the auditing procedures applied in our
audit of the basic 1998 financial statements and, in our opinion, are fairly
stated in all material respects when considered in relation to the basic
financial statements taken as a whole.
/s/ Deloitte & Touche LLP
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DELOITTE & TOUCHE LLP
Atlanta, Georgia
May 6, 1999
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<PAGE>
COX COMMUNICATIONS, INC. SAVINGS AND INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998 AND 1997
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<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
INVESTMENTS - At fair value $ 164,072,889 $ 136,143,071
EMPLOYEE CONTRIBUTIONS RECEIVABLE 538,587 460,268
EMPLOYER CONTRIBUTION RECEIVABLE 206,781 180,763
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NET ASSETS AVAILABLE FOR BENEFITS $ 164,818,257 $ 136,784,102
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See notes to financial statements.
</TABLE>
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<PAGE>
COX COMMUNICATIONS, INC. SAVINGS AND INVESTMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 1998 AND 1997
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<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
NET ASSETS AVAILABLE FOR BENEFITS - Beginning of period $ 136,784,102 $ 106,473,306
ADDITIONS (DEDUCTIONS):
Employee contributions 16,164,488 13,202,157
Employer contributions 5,523,638 4,755,842
Interest and dividends 10,226,719 12,345,436
Net appreciation in fair value of investments 9,985,997 11,929,996
Transfers to other plans (3,472,788) (195,164)
Distributions to participants (10,393,899) (11,727,471)
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NET ASSETS AVAILABLE FOR BENEFITS - End of period $ 164,818,257 $ 136,784,102
============= =============
</TABLE>
See notes to financial statements.
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<PAGE>
COX COMMUNICATIONS, INC. SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
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1. PLAN DESCRIPTION
The following brief description of the Cox Communications, Inc. Savings and
Investment Plan (the "Plan") is provided for general information purposes
only. Participants should refer to the Plan Document for more complete
information.
General - The Plan was adopted by Cox Communications, Inc. (the "Company")
effective February 1, 1995 to provide tax deferred savings and matching
employer contributions to eligible employees.
The Plan is a defined contribution plan subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA"). Employees are
eligible for participation in the Plan after completing one year of
service.
Administration - The Plan is administered by the Cox Enterprises, Inc.
Management Committee which is responsible for overall Plan policy and
the Administrative Committee which is responsible for the daily operations
of the Plan. The Administrative Committee is authorized to employ agents,
etc., as may be required, to carry out the provisions of the Plan.
Administrative expenses, other than those related to participant loans, are
charged to and paid directly by the Company. All administrative expenses
related to the participant loan process are charged directly against the
participant's lowest risk investment balance by Vanguard Fiduciary Trust
Company ("Vanguard"), the Plan's trustee.
Contributions - Effective July 1, 1995, all eligible participants could
elect to contribute, through a payroll deduction program, an amount ranging
from 1% to 15% (6% for highly-compensated employees) of eligible pay up to
a maximum of $10,000 in 1997 and 1998. The Company contributes an amount
equal to 50% of each participant's contribution, not to exceed 6% of the
participant's eligible pay. Participants are automatically vested in both
their employee and employer contribution accounts upon joining the Plan.
Participant Accounts - Each participant's account is credited with the
participant's contribution, the Company's matching contribution, and
allocations of Plan earnings. Allocations are based on participant
earnings or account balances, as defined.
Distributions - Upon written request and approval of the Committee,
participants may withdraw amounts as specified in the Plan Document from
their employee contribution account if the withdrawal is necessary due to
hardship.
A participant's contributions and employer matching contributions may be
withdrawn upon retirement, termination of employment, or death.
Investment Options - During both 1998 and 1997, a participant could direct
the investment of his or her account balance, including the employer match,
in any of the following Vanguard managed funds: Vanguard Wellington Fund,
Vanguard Windsor Fund, Vanguard Morgan Growth Fund, Vanguard Federal Money
Market Fund, Vanguard Short-term Corporate Bond Fund, Vanguard Intermediate
Term Corporate Bond Fund, Vanguard International Growth Fund, Vanguard
Total Stock Market Index Fund, and the Cox Communications Class A Common
Stock Fund. Certain former Times Mirror employees may also own interests in
the Series A or Series C Times Mirror Stock Fund; however, contributions to
these funds are no longer allowed. During 1998, all shares of Times Mirror
Series B Fund were swapped for shares of Times Mirror Series A Fund.
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<PAGE>
Loans - Plan participants are eligible to apply for loans from their
employee contribution account. The loan amount may not exceed certain
limits as outlined in the Plan provisions. Interest is charged at the
prime interest rate as indicated in the Wall Street Journal. Loans are
secured by the account balance of the participant and are generally payable
over periods not longer than five years, except for home loans which may
not exceed 30 years.
2. ACCOUNTING POLICIES
Basis of Accounting - The accounts of the Plan are maintained, and the
accompanying financial statements have been prepared, on the accrual basis
of accounting.
Valuation of Investments - Values for securities are based on the quoted
net asset value (redemption value) of the respective investment company;
units of participation in mutual funds are valued at quoted market prices.
Values for company stock funds are based on their unit closing prices.
Participant loans are valued based upon the remaining unpaid principal
balance plus any accrued but unpaid interest thereon, which approximates
fair value.
Payments of Benefits - Benefit payments to participants are recorded upon
distribution.
Use of Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of increases and
decreases during the reporting period. Actual results could differ from
those estimates.
Reclassifications - Certain amounts included in the 1997 financial
statements have been reclassified to conform to the 1998 presentation.
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<PAGE>
3. SEPARATE FUND INFORMATION
Significant components of the changes in net assets for the years ended
December 31, 1998 and 1997 as allocated to the separate investment funds
are as follows:
<TABLE>
<CAPTION>
Cox
Comm. Times Times Times
Class A Mirror Mirror Mirror Vanguard
Common Series A Series B Series C Vanguard Vanguard Morgan
Stock Stock Stock Stock Wellington Windsor Growth
Fund Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C> <C>
Net assets available for benefits,
December 31, 1996 $ 3,765,665 $ 4,786,613 $ 327,337 $ 233,786 $ 18,195,302 $ 26,837,308 $ 13,028,323
Employee contributions 1,032,333 0 0 0 1,856,729 3,922,231 2,635,908
Employer contributions 364,641 0 0 0 1,404,551 1,003,112 714,639
Interest and dividends 0 49,407 4,966 2,372 1,991,445 5,632,233 2,547,209
Net appreciation (depreciation) in
fair value of investments 3,610,030 1,023,687 62,181 49,803 2,398,365 488,285 1,786,267
Distributions to participants (311,005) (406,709) (9,321) (19,969) (1,905,369) (2,622,459) (1,844,262)
Net withdrawals of participant
loans (69,179) (106,472) (759) (4,933) (46,501) (313,452) (180,953)
Transfers from (to) other funds 484,357 (109,165) (384,444) (18,352) (109,024) 720,612 564,891
Transfers from (to) other plans
and other deductions 113,517 (4) 40 0 (107,323) (10,980) 42,012
----------- ----------- --------- --------- ------------ ------------ ------------
Net assets available for benefits,
December 31, 1997 $ 8,990,359 $ 5,237,357 0 $ 242,707 $ 23,678,175 $ 35,656,890 $ 19,294,034
Employee contributions 2,004,952 0 0 0 2,235,484 4,320,418 3,189,964
Employer contributions 629,268 0 0 0 1,454,714 1,103,160 888,468
Interest and dividends 261 51,980 0 2,327 2,984,996 3,186,845 1,976,813
Net appreciation (depreciation) in
fair value of investments 7,649,431 (414,293) 0 (19,043) (103,849) (2,912,246) 2,582,262
Distributions to participants (890,111) (325,055) 0 (9,859) (1,926,326) (1,998,296) (1,195,115)
Net withdrawals of participant
loans (310,107) (68,362) 0 (655) (179,037) (311,146) (155,058)
Transfers from (to) other funds 966,659 (248,803) 0 (15,604) (318,616) (1,901,025) 186,500
Transfers from (to) other plans
and other deductions (288,725) (479,737) 0 (32,787) (368,046) (325,010) (221,450)
------------ ----------- --------- --------- ------------ ------------ ------------
Net assets available for benefits,
December 31, 1998 $ 18,751,987 $ 3,753,087 $ 0 $ 167,086 $ 27,457,495 $ 36,819,590 $ 26,546,418
============ =========== ========= ========= ============ ============ ============
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<PAGE>
Vanguard
Vanguard Vanguard Vanguard Total
Federal Short Intermediate Vanguard Stock
Money Term Term International Market
Market Corporate Corporate Growth Index Participant
Fund Fund Fund Fund Fund Loans Total
<S> <C> <C> <C> <C> <C> <C> <C>
Net assets available for benefits,
December 31, 1996 $ 11,532,981 $ 8,075,297 $ 429,106 $ 4,665,403 $ 8,907,408 $ 5,688,777 $106,473,306
Employee contributions 788,900 914,662 243,810 814,783 992,801 0 13,202,157
Employer contributions 186,524 407,397 79,408 274,949 320,621 0 4,755,842
Interest and dividends 575,328 516,080 40,016 213,363 296,344 476,673 12,345,436
Net appreciation (depreciation) in
fair value of investments 0 49,977 16,433 (11,880) 2,456,848 0 11,929,996
Distributions to participants (1,343,119) (765,014) (131,361) (677,857) (1,159,768) (531,258) (11,727,471)
Net withdrawals of participant
loans (128,379) (38,881) 8,644 (41,778) (248,679) 1,171,322 0
Transfers from (to) other funds (983,800) (337,556) 108,471 (141,871) 205,881 0 0
Transfers from (to) other plans
and other deductions (36,591) (51,190) 15,586 (36,008) (140,661) 16,438 (195,164)
------------ ----------- --------- ----------- ------------ ----------- ------------
Net assets available for benefits,
December 31, 1997 $ 10,591,844 $ 8,770,772 $ 810,113 $ 5,059,104 $ 11,630,795 $ 6,821,952 $136,784,102
Employee contributions 721,115 891,816 356,790 826,238 1,617,711 0 16,164,488
Employer contributions 170,781 394,732 104,789 290,651 487,075 0 5,523,638
Interest and dividends 512,169 553,420 76,229 117,455 234,751 529,473 10,226,719
Net appreciation (depreciation) in
fair value of investments 0 23,399 5,695 704,151 2,470,490 0 9,985,997
Distributions to participants (1,293,741) (642,909) (85,962) (475,385) (1,010,296) (540,844) (10,393,899)
Net withdrawals of participant
loans (150,907) (44,671) 4,655 (81,412) (153,197) 1,449,897 0
Transfers from (to) other funds 980,564 (183,033) 314,375 (246,527) 465,510 0 0
Transfers from (to) other plans
and other deductions (641,619) (41,704) (55,552) (220,222) (803,893) 5,957 (3,472,788)
------------ ----------- ----------- ----------- ------------ ----------- ------------
Net assets available for benefits,
December 31, 1998 $ 10,890,206 $ 9,721,822 $ 1,531,132 $ 5,974,053 $ 14,938,946 $ 8,266,435 $164,818,257
============ =========== =========== =========== ============ =========== ============
</TABLE>
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<PAGE>
4. INVESTMENTS
The Plan's investments, including those representing 5% or more of the
Plan's net assets, are as follows:
<TABLE>
<CAPTION>
1998 1997
---------------------------------- ---------------------------------
Number of Fair Number of Fair
Units Value Units Value
<S> <C> <C> <C> <C>
Cox Communications Class A
Common Stock Fund 532,218 $ 18,643,608 440,446 $ 8,932,254
Times Mirror Series A Stock Fund 227,184 3,753,087 288,719 5,237,357
Times Mirror Series C Stock Fund 10,090 167,086 13,358 242,707
Vanguard Wellington Fund 931,260 27,332,490 799,590 23,547,918
Vanguard Windsor Fund 2,353,863 36,649,647 2,087,240 35,441,340
Vanguard Morgan Growth Fund 1,339,105 26,407,146 1,091,955 19,152,897
Vanguard Federal Money Market Fund 10,858,416 10,858,416 10,552,700 10,552,700
Vanguard Short-Term Corporate Bond Fund 893,038 9,680,536 806,042 8,713,319
Vanguard Intermediate-Term Corporate Bond Fund 151,151 1,516,048 80,253 797,717
Vanguard International Growth Fund 316,175 5,934,600 306,039 5,015,982
Vanguard Total Stock Market Index Fund 542,078 14,863,790 511,485 11,580,033
Loans to participants 8,266,435 6,928,847
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$ 164,072,889 $ 136,143,071
============= =============
</TABLE>
5. PLAN TERMINATION
If the Plan should be terminated, the trustee would be instructed to
continue and maintain separate Plan accounts for each participant to
accumulate earnings and profits until distribution of benefits under the
provisions of the Plan are allowable.
6. TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter dated February 19, 1997 that the Plan, as then designed, was in
compliance with the applicable requirement of the Internal Revenue Code
("IRC"). The Plan Administrator believes that the Plan is designed and
currently being operated in compliance with the applicable requirements of
the IRC.
7. RELATED PARTY TRANSACTIONS
The Cox Communication Class A Common Stock Fund held 269,709 shares
($18,643,608 fair value) and 222,958 shares ($8,932,254 fair value) at
December 31, 1998 and 1997, respectively.
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<PAGE>
SUPPLEMENTAL SCHEDULES
(See Independent Auditors' Report)
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<PAGE>
COX COMMUNICATIONS, INC. SAVINGS AND INVESTMENT PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1998
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<TABLE>
<CAPTION>
Identity Current
of Issue Description of Investment Cost Value
<S> <S> <C> <C>
*Vanguard Federal Money Market Fund Registered Investment Company $10,858,416 $10,858,416
*Vanguard Intermediate Term Corporate Bond Fund Registered Investment Company 1,501,613 1,516,048
*Vanguard International Growth Fund Registered Investment Company 5,233,114 5,934,600
*Vanguard Morgan Growth Fund Registered Investment Company 22,237,668 26,407,146
*Vanguard Short-Term Corporate Bond Fund Registered Investment Company 9,693,388 9,680,536
*Vanguard Total Stock Market Index Fund Registered Investment Company 10,038,240 14,863,790
*Vanguard Wellington Fund Registered Investment Company 25,256,506 27,332,490
*Vanguard Windsor Fund Registered Investment Company 38,106,282 36,649,647
Times Mirror Series A Stock Fund Company Stock Fund 1,677,123 3,753,087
Times Mirror Series C Stock Fund Company Stock Fund 78,806 167,086
*Cox Communications Class A Common Stock Fund Company Stock Fund 8,307,008 18,643,608
Various (interest ranging from 6% to 9%,
*Loans to participants maturities ranging from 1 to 180 months) 8,266,435 8,266,435
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$141,254,599 $164,072,889
============ ============
</TABLE>
*Party-in-interest to the Plan.
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<PAGE>
COX COMMUNICATIONS, INC. SAVINGS AND INVESTMENT PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1998
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<TABLE>
<CAPTION>
Description of Asset Current Value
Identity of (Include Interest of Asset on
Party Rate and Maturity in Purchase Selling Historical Transaction Net
Involved Case of Loan) Price Price Cost Date Gain
<S> <C> <C> <C> <C> <C> <C>
Separate Transactions:
[NONE]
Series of Transactions:
The Vanguard Group Vanguard Federal Money Market Fund 6,540,520 6,540,520
The Vanguard Group Vanguard Federal Money Market Fund 6,234,801 6,234,801 6,234,801
The Vanguard Group Vanguard Morgan Growth Fund 8,551,765 8,551,765
The Vanguard Group Vanguard Morgan Growth Fund 3,879,779 3,566,217 3,879,779 313,562
The Vanguard Group Vanguard Wellington Fund 8,042,952 8,042,952
The Vanguard Group Vanguard Wellington Fund 4,154,531 3,641,217 4,154,531 513,314
The Vanguard Group Vanguard Windsor Fund 11,193,118 11,193,118
The Vanguard Group Vanguard Windsor Fund 7,072,566 6,934,057 7,072,566 138,509
Cox Communications, Inc. Cox Communications, Inc.
Common Stock, Class A 8,373,251 8,373,251
Cox Communications, Inc. Cox Communications, Inc.
Common Stock, Class A 6,311,327 4,570,795 6,311,327 1,740,532
</TABLE>
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<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
plan administrator has duly caused this Annual Report to be signed on behalf of
the plan by the undersigned hereunto duly authorized.
COX COMMUNICATIONS, INC.
SAVINGS AND INVESTMENT PLAN
By: /s/ Andrew A. Merdek Date: June 24, 1999
--------------------
Andrew A. Merdek
COX COMMUNICATIONS, INC.
Corporate Secretary
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EXHIBIT 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
33-80995 of Cox Communications, Inc. on Form S-8 of our report dated May 6,
1999, appearing in this Annual Report on Form 11-K of Cox Communications, Inc.
Savings and Investment Plan for the year ended December 31, 1998.
/s/ Deloitte & Touche LLP
-------------------------
DELOITTE & TOUCHE LLP
Atlanta, Georgia
June 28, 1999
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