<PAGE>
<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
Commission file number 000-05558
--------------------
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
(Exact name of registrant as specified in its charter)
(formerly Highland Telephone Company)
-------------------
NEW YORK 14-0750550
- --------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
180 South Clinton Avenue
Rochester, New York 14646-0700 14646
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(914) 783-1400
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
- ------------------- ---------------------
5.7% Cumulative Preferred None
Stock Series A
Securities registered pursuant to Section 12(g) of the Act: None
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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 by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (Section 229.405 of this
chapter) is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. [x]
State the aggregate market value of the voting stock held by
non-affiliates of the registrant. The aggregate market value
shall be computed by reference to the price at which the stock
was sold, or the average bid and asked prices of such stock, as
of a specified date within 60 days prior to the date of filing.
NO REGULAR MARKET IS MAINTAINED IN THE REGISTRANT'S
5.7% CUMULATIVE PREFERRED STOCK, SERIES A
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest
practicable date: $4.50 Par Value Common Stock 506,758 shares
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COVER PAGE
LOGO
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
a Frontier Corporation Company
1995 ANNUAL REPORT
- -----------------------------------------
INSIDE COVER
OUR BUSINESS AND TERRITORY
Frontier Communications of New York, Inc., a subsidiary of
Frontier Corporation, furnishes telecommunications services
within a franchised area in Orange and Ulster Counties, New York,
comprising approximately 335 square miles. The Company provides
service to approximately 59,000 access lines.
Frontier Communications of New York, Inc. is committed to equal
opportunity for all employees regardless of race, color,
religion, sex, age, national origin, handicap or veteran status.
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FRONTIER COMMUNICATIONS OF NEW YORK, INC.
(the "Company")
BOARD OF DIRECTORS
RONALD L. BITTNER LOUIS L. MASSARO
Director of the Company; also Director; also Executive
Director, Chairman, President Vice President and Chief
and Chief Executive Officer of Administrative Officer of
Frontier Corporation, a Frontier Corporation, a
telecommunications company. telecommunications company.
MARVIN C. MOSES
Director of the Company;
also Director, Vice Chairman
and Chief Financial Officer of
Frontier Corporation, a
telecommunications company.
EXECUTIVE OFFICERS
JEREMIAH T. CARR MARTIN MUCCI
President and Chief Executive Vice President and
Officer of the Company; also General Manager of the
Director and Chairman of Company; also Vice
Rochester Telephone Corp., President and Treasurer
a telecommunications company; of Rochester Telephone
also Senior Corporate Vice Corp., a telecommuni-
President of Frontier cations company
Corporation, a telecommuni-
cations company.
JOSEPHINE S. TRUBEK JOSEPH ENIS
Secretary of the Company; Treasurer of the Company;
also Corporate Secretary of also Treasurer of Frontier
Frontier Corporation, a Corporation, a telecom-
telecommunications company. munications company.
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<PAGE>5
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
5 YEAR SUMMARY OF OPERATIONS - Pg. 1
{Not Covered by Report of Independent Accountants}
For the year ended December 31,
1995 1994 1993
STATEMENT OF INCOME
Operating Revenues $44,423,712 $44,631,983 $41,527,353
Operating Expenses 28,465,172 30,150,634 27,713,830
& Taxes ---------- ---------- ----------
15,958,540 14,481,349 13,813,523
Federal Income Tax 5,312,400 4,752,600 4,518,903
---------- ---------- ----------
Income from operations 10,646,140 9,728,749 9,294,620
Other Income (Expense)-Net 92,131 287,503 322,376
---------- ---------- ----------
Income Before Fixed Charges
& Extraordinary Item 10,738,271 10,016,252 9,616,996
Fixed Charges 796,696 777,924 1,150,428
---------- ---------- ---------
Income Before Extra- 9,941,575 9,238,328 8,466,568
ordinary Item
Extraordinary Item (8,208,097) 0 0
----------- ---------- ---------
Net Income $1,733,478 $9,238,328 $8,466,568
---------- ---------- ---------
BALANCE SHEET
Current Assets $22,534,368 $16,511,545 $16,168,983
Telephone Plant 47,406,297 61,457,925 64,129,219
Deferred & Other Assets 2,196,392 4,248,319 3,283,673
---------- ---------- ----------
Total Assets $72,137,057 $82,217,789 $83,581,875
---------- ---------- ----------
Current Liabilities $14,644,917 $15,110,202 $26,067,683
Long-Term Debt 8,900,000 8,900,000 3,000,000
Deferred Federal 5,148,084 10,486,502 11,188,704
Income Taxes
Other Deferred Credits 4,202,525 4,046,362 2,225,488
Share Owners' Equity 39,241,531 43,674,723 41,100,000
---------- ---------- ----------
Total Liabilities &
Share Owners' Equity $72,137,057 $82,217,789 $83,581,875
---------- ---------- ----------
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FRONTIER COMMUNICATIONS OF NEW YORK, INC.
5 YEAR SUMMARY OF OPERATIONS - Pg. 2
{Not Covered by Report of Independent Accountants}
For the year ended December 31,
1995 1994 1993
Cash Dividends:
Preferred 158,655 158,968 159,903
Common 6,000,015 6,496,637 5,929,069
---------- ---------- ----------
Total Dividends $6,158,670 $6,655,605 $6,088,972
---------- ---------- ----------
Per Share Information (Note 1):
Income Before Extraordinary
Item Per Common Share $19.30 $17.92 $16.39
Net Income Per
Common Share $3.11 $17.92 $16.39
Cash Dividends Per
Common Share $11.84 $12.82 $11.70
Average Shares of Common
Stock Outstanding 506,758 506,758 506,758
Note 1: Income before extraordinary item per common share is
derived by deducting preferred stock dividends from income before
extraordinary item. Net income per common share is derived by
deducting preferred stock dividends from net income. Cash
dividends per common share represent the annual dividend rate
paid by the Company.
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<PAGE>7
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
5 YEAR SUMMARY OF OPERATIONS - Pg. 3
{Not Covered by Report of Independent Accountants}
For the year ended December 31,
1992 1991
STATEMENT OF INCOME
Operating Revenues $37,397,643 $33,936,765
Operating Expenses 25,876,184 25,118,735
& Taxes ---------- ----------
11,521,459 8,818,030
Federal Income Tax 3,285,000 1,891,000
---------- ----------
Income from operations 8,236,459 6,927,030
Other Income (Expense)-Net 116,419 251,770
---------- ----------
Income Before Fixed Charges
& Extraordinary Item 8,352,878 7,178,800
Fixed Charges 1,394,939 1,708,306
---------- ----------
Income Before Extra- 6,957,939 5,470,494
ordinary Item
Extraordinary Item 0 0
--------- ----------
Net Income $6,957,939 $5,470,494
---------- ----------
BALANCE SHEET
Current Assets $11,357,506 $8,261,303
Telephone Plant 64,424,132 62,996,556
Deferred & Other Assets 3,714,723 3,882,020
---------- ----------
Total Assets $79,496,361 $75,139,879
---------- ----------
Current Liabilities $18,805,309 $14,885,869
Long-Term Debt 8,640,000 10,730,000
Deferred Federal 12,741,236 11,976,992
Income Taxes
Other Deferred Credits 579,412 563,784
Share Owners' Equity 38,730,404 36,983,234
---------- ----------
Total Liabilities &
Share Owners' Equity $79,496,361 $75,139,879
---------- ----------
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FRONTIER COMMUNICATIONS OF NEW YORK, INC.
5 YEAR SUMMARY OF OPERATIONS - Pg. 4
{Not Covered by Report of Independent Accountants}
For the year ended December 31,
1992 1991
Cash Dividends:
Preferred 160,527 161,464
Common 5,042,242 3,663,860
---------- ----------
Total Dividends $5,202,769 $3,825,324
---------- ----------
Per Share Information (Note 1):
Income Before Extraordinary
Item Per Common Share $13.41 $10.48
Net Income Per
Common Share $13.41 $10.48
Cash Dividends Per
Common Share $9.95 $7.23
Average Shares of Common
Stock Outstanding 506,758 506,758
Note 1: Income before extraordinary item per common share is
derived by deducting preferred stock dividends from income before
extraordinary item. Net income per common share is derived by
deducting preferred stock dividends from net income. Cash
dividends per common share represent the annual dividend rate
paid by the Company.
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<PAGE>9
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
a Frontier Corporation company
Management's Discussion of Results of Operations and
Analysis of Financial Condition
The information presented in this Management's Discussion of
Results of Operations and Analysis of Financial Condition should
be read in conjunction with the financial statements and
accompanying Notes of Frontier Communications of New York, Inc.
(the "Company") for the three years ended December 31, 1995.
MAJOR EVENTS
In December 1994, upon receiving shareowner approval,
Rochester Telephone Corporation, the parent company, reorganized
as a holding company and changed its name to Frontier Corporation
("Frontier"). During 1995, upon receiving shareowner approval,
Highland Telephone Company adopted the Frontier brand and changed
the Company's name to Frontier Communications of New York, Inc.
The new name reflects the pioneering heritage of our past
combined with our willingness to embrace the challenges of the
future. The name also symbolizes the change from a corporation
focused primarily in Rochester, New York to a corporation that is
expanding geographically.
As of September 30, 1995, the Company discontinued the
application of Financial Accounting Standards No. 71 (FAS 71),
"Accounting for the Effects of Certain Types of Regulation." The
Company discontinued the use of FAS 71 based upon changes in
regulation and increasingly rapid advancements in
telecommunications technology and other factors creating
competitive markets. The discontinuance of regulatory accounting
methods resulted in a non-cash post-tax extraordinary charge of
$8,208,000, net of applicable income taxes of $2,467,000,
primarily caused by the reduction in the recorded value of
long-lived telephone plant assets.
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<PAGE>10
RESULTS OF OPERATIONS
Total Operating Revenues
- ------------------------
Total operating revenues decreased $208,000, or 0.5 percent,
in 1995; and increased $3,105,000, or 7.5 percent, in 1994.
-Local Service Revenue
----------------------
Local service revenue increased $750,000, or 6.1 percent,
from $12.2 million in 1994 to $12.9 million in 1995. Local
service revenue increased $1,055,000, or 9.5 percent, in 1994.
The 1995 and 1994 revenue growth are the result of increases in
access lines in service, higher sales of enhanced custom calling
features, and, advanced number identification products, like
Caller ID.
-Toll Service Revenue
---------------------
Toll service revenue decreased $2,023,000, or 9.0 percent,
from $22.4 million in 1994 to $20.4 million in 1995. Toll
service revenue increased $2,659,000, or 13.4 percent, in 1994.
The 1995 revenue decrease is attributable to a decrease in the
access rates charged to long distance companies and a change in
New York State Tax Legislation disallowing the gross receipts tax
surcharge on access revenues. The 1994 revenue increase is
attributable to growth in long distance usage.
In general, prices being charged to long distance companies
for access service usage, which represents fees charged for the
use of the Company's network, declined slightly over the past
three years to address the Company's need to be competitive in
this market sector. The Company expects this price decline to
continue as competition increases.
-Directory Revenues
-------------------
Directory revenues increased $26,300, or 0.7 percent, in
1995 and $33,000, or 0.9 percent, in 1994. The marginal revenue
increases in both 1995 and 1994 reflect that there was virtually
no growth in the volume of advertising sales. Given existing
competition in the directory marketplace, the Company anticipates
that the 1996 directory revenues will increase approximately 3.0
percent.
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-Miscellaneous Revenues
-----------------------
Miscellaneous revenues increased $380,700, or 5.3 percent,
in 1995 and decreased $201,200, or 2.7 percent, in 1994. The
1995 revenue increase is attributable to increased billing and
collection revenues, reflecting higher calling volumes and new
product offerings, like paging and internet. The 1994 decrease
was primarily the result of a reduction in AT&T contract
services, which were offset in part by increased billing and
collection revenues, reflecting higher calling volumes and
deregulated sales.
Operating Expenses and Taxes
- ----------------------------
Operating expenses and taxes decreased 5.6 percent in 1995
and increased 8.8 percent in 1994. Excluding depreciation,
expenses decreased 9.0 percent in 1995 and increased 9.4 percent
in 1994. The 1995 expense decrease is attributed to continued
wage and benefit savings associated with productivity
improvements and combining administrative functions and cost
reductions from changes in employee benefit programs. The 1994
expense increase is attributed to the $1.8 million increase in
data processing expenses associated with the creation, in 1994,
of a corporate data processing organization. In 1994, the
Company achieved wage and benefit savings associated with
combining administrative functions and streamlining operations to
arrive at a reduced cost structure.
In 1994, the Company adopted the Financial Accounting
Standards Board Statement No. 112 (FAS 112), "Employers'
Accounting for Postretirement Benefits", which addresses the
manner in which companies must record expenses for postemployment
benefits, including payments for disability, pre-pension leave
(salary continuation) and severance pay. FAS 112 requires that
projected future costs of providing postemployment benefits be
recognized as an expense as employees render service rather than
when the benefits are paid. Adoption of FAS 112 required the
Company to calculate, and record in 1994, the cumulative effect
of the change in accounting methodology for all years prior to
1994. For 1994, the adoption of this standard resulted in
additional operating expenses in the amount of $76,900.
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<PAGE>12
Depreciation expenses increased 9.0 percent in 1995 and 6.2
percent in 1994. The increases in both years are the result of
additions to telephone plant in service in each year.
Interest Expense
- ----------------
Total interest expense increased 2.4 percent in 1995 and
decreased 32.4 percent in 1994. The 1995 expense increase is
attributable to higher advances balance from its parent company.
The 1994 expense decrease is primarily a result of the lower
outstanding loan balances from pay downs on long term debt during
1993 and decrease in interest rates.
Income Taxes
- ------------
The effective federal income tax rate in 1995 was 34.8
percent compared with 34.0 percent in 1994.
Net Income
- ----------
Net income decreased 81.2 percent in 1995 and increased 9.1
percent in 1994. The 1995 decrease in net income reflects an
extraordinary item charge of $8,208,000, net of taxes of
$2,467,000, from the Company's discontinuance of FAS 71,
"Accounting for the Effects of Certain Types of Regulation".
(See note 2 in Notes to Financial Statements). Income before
extraordinary item increased 7.6 percent in 1995. The 1995
increase in income before extraordinary item reflect increases in
directory and miscellaneous revenues and decreased operating
expenses and taxes. The 1994 increase in net income reflect
increases in local and toll revenues, interest income, and
decreased interest expense on outstanding debt.
FINANCIAL CONDITION
Liquidity and Capital Resources
- -------------------------------
Cash and cash equivalents amounted to $4,826,697 at year end
1995 and $621,145 at year end 1994. The increase in 1995 is the
result of a change in cash management policy mandated by the New
York State Public Service Commission limiting the allowable cash
advances to the parent company for cash management purposes;
thereby requiring excess funds to be invested in interest bearing
accounts under the Company's name. The decrease in 1994 is the
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<PAGE>13
result of pay downs on short term debt and increased dividend
payments.
At year end 1995, the Company had $8.9 million of long-term
notes payable to Frontier Corporation; $3.0 million at 6.25
percent interest due on July 6, 2003 and $5,900,000 at 8.4
percent interest due on January 1, 2005. These borrowings were
used to retire long term first mortgage bonds, to take advantage
of lower interest rates, and to pay off a short term loan owed to
Chemical Bank. The original debt served to finance the Company's
construction program prior to 1989. The Company anticipates
meeting its debt obligation with cash generated from operations.
A key financial indicator of the Company's ability to meet
its debt obligations is pre-tax interest coverage. The Company's
pre-tax interest coverage was 9.8 times total interest expense
for 1995 and 19.0 times for 1994. The 1995 pre-tax interest
coverage of 9.8 times total interest expense is attributable to a
decrease in earnings the Company experience due to the
discontinuance of FAS 71, "Accounting for the Effects of Certain
Types of Regulation" (See note 2 in Notes to the Financial
Statements) and an increase in interest expense the Company
experienced in connection with higher advances balance from its
parent company.
The ratio of long term debt to total capitalization
increased to 18.5 percent at the end of 1995 and from 16.9
percent at the end of 1994.
After tax coverage of Preferred Stock dividends was 10.9
times net income in 1995 compared with 58.1 times net income in
1994.
The Company internally financed 100.0 percent of its
$3,605,000 construction program in 1995, and in 1994, financed
100.0 percent of a $3,045,000 program. During 1996, the Company
will expend $3,320,000 for additions to plant, property, and
equipment. Working capital requirements for the 1996
construction program are projected to be met by internally
generated funds.
In the past, the Company sold its own debt securities.
Management feels that the Company has the ability to market its
own debt securities.
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Effects of Competition and Inflation
- ------------------------------------
The 1990's will bring further deregulation of
telecommunication products and services, as well as increasing
competition in virtually all of the Company's markets, including
local dial tone. Today, competition is prevalent with respect to
business telecommunication systems, directory, and telephone
sales. The Company has made and will continue to make
significant investments in its network, including deployment of
fiber optic cable and digital switches. This will enable the
Company to compete more effectively, to provide enhanced services
and attract new businesses. Furthermore, the Company believes
its commitment to an enhanced quality focus will strengthen its
strong service position. This is essential to sustaining
viability in all of the Company's markets and a prerequisite to
competing in the 1990's.
The Company intends to continue to counteract the effects of
inflation through cost reductions, improved productivity and
enhanced marketing programs.
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<PAGE>15
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
(A subsidiary of Frontier Corporation)
Report of Independent Accountants
March 8, 1996
To the Shareowners and
Board of Directors of
Frontier Communications of New York, Inc.
In our opinion, the accompanying balance sheets and the
related statements of income, of retained earnings and of
cash flows present fairly, in all material respects, the
financial position of Frontier Communications of New York,
Inc. (formerly Highland Telephone Company) at December 31,
1995, 1994 and 1993, and the results of its operations and
its cash flows for the years then ended, in conformity
with generally accepted accounting principles. These
financial statements are the responsibility of the
Company's management; our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits of these statements in accordance
with generally accepted auditing standards, which 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, assessing the
accounting principles used and significant estimates made
by management, and evaluating the overall financial
statement presentation. We believe that our audits
provide a reasonable basis for the opinion expressed
above.
As discussed in Note 2 to the financial statements, during
the third quarter of 1995, the Company discontinued
accounting in accordance with Statement of Financial
Accounting Standards No. 71, "Accounting for the Effects
of Certain Types of Regulation."
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
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<PAGE>16
Balance Sheet
December 31,
---------------------------
1995 1994 1993
Assets
Current assets:
Cash and cash equivalents $ 4,826,697 $ 621,145 $ 2,615,010
Accounts receivable 9,560,404 9,016,180 8,375,451
Accounts receivable - affiliates 7,067,845 5,815,779 3,871,791
Refundable taxes 143,911 293,689 275,962
Materials and supplies 345,314 251,225 420,654
Prepayments 590,197 513,527 610,115
-------------------------------------
Total current assets 22,534,368 16,511,545 16,168,983
-------------------------------------
Telephone plant, at original cost:
Telephone plant in service 106,359,529 104,047,094 100,598,594
Telephone plant under construction 1,556,240 855,410 1,982,377
--------------------------------------
107,915,769 104,902,504 102,580,971
Less - Accumulated depreciation (60,509,472) (43,444,579) (38,451,752)
--------------------------------------
Net telephone plant 47,406,297 61,457,925 64,129,219
Regulated deferred asset 2,770,676 2,804,242
Prepaid pension expense 2,127,121 1,303,179 406,591
--------------------------------------
Other assets 69,271 174,464 72,840
Total assets $ 72,137,057 $ 82,217,789 $ 83,581,875
=======================================
See accompanying notes to financial statements.
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<PAGE>17
Balance Sheet
December 31,
---------------------------
1995 1994 1993
Liabilities and Shareowners' Equity
Current liabilities:
Accounts payable $ 4,581,943 $ 5,440,783 $ 6,931,887
Advances/accounts payable
- affiliates 8,375,995 8,480,742 16,218,890
Common stock dividends payable 1,500,004
Customer deposits 366,623 403,763 447,951
Advance billing for telephone service 377,634 301,286 290,898
Preferred dividends payable 37,224 43,052 43,833
Income taxes due to parent 858,333 402,338 609,898
Interest accrued 47,165 38,238 24,322
---------------------------------------
Total current liabilities 14,644,917 15,110,202 26,067,683
---------------------------------------
Long-term debt 8,900,000 8,900,000 3,000,000
---------------------------------------
Deferred federal income taxes 5,148,084 10,486,502 11,188,704
---------------------------------------
Other deferred credits 699,186 636,488
Other postemployment benefits 4,202,525 3,347,176 1,589,000
---------------------------------------
Shareowners' equity:
Common stock, $4.50 par value -
Authorized - 1,257,333 shares
Issued and outstanding
- 506,758 shares 2,280,411 2,280,411 2,280,411
Capital in excess of par value 683,327 683,327 683,327
Other capital paid by
parent company 7,005,266 7,005,266 7,005,266
Retained earnings 26,779,127 31,204,319 28,621,596
----------------------------------------
Common shareowner's equity 36,748,131 41,173,323 38,590,600
Preferred stock (cumulative), $100 par value -
Authorized - 40,000 shares
Issued and outstanding -
Series A - 5-7/8%
- 18,694 shares 1,869,400 1,869,400 1,869,400
Series B - 7.8%
- 6,240 shares in 1995,
6,320 shares in 1994
and 6,400 shares in 1993 624,000 632,000 640,000
-----------------------------------------
Total shareowners' equity 39,241,531 43,674,723 41,100,000
-----------------------------------------
Total liabilities and
shareowners' equity $ 72,137,057 $ 82,217,789 $ 83,581,875
=========================================
See accompanying notes to financial statements.
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<PAGE>18
Statement of Income
For the year ended December 31,
----------------------------------
1995 1994 1993
Operating revenues:
Local service $12,955,072 $12,204,921 $11,149,767
Toll service 20,430,279 22,453,673 19,794,474
Directory advertising revenues 3,616,227 3,589,903 3,556,916
Miscellaneous 7,603,807 7,223,074 7,424,323
Less - Uncollectibles (181,673) (839,588) (398,127)
-------------------------------------
Total operating revenues 44,423,712 44,631,983 41,527,353
-------------------------------------
Operating expenses:
Plant specific 7,483,622 6,702,322 5,821,310
Plant non-specific 1,528,724 1,192,426 1,398,685
Depreciation 6,231,913 5,716,417 5,383,946
Customer operations 5,349,061 6,711,903 5,992,779
Corporate operations 4,478,851 5,831,836 5,399,458
Other taxes 3,393,001 3,995,730 3,717,652
--------------------------------------
Total operating expenses 28,465,172 30,150,634 27,713,830
--------------------------------------
Operating income 15,958,540 14,481,349 13,813,523
--------------------------------------
Interest expense 796,696 777,924 1,150,428
Other income and expense:
Allowance for funds used during
construction 25,736 24,492 117,817
Other income, net 66,395 263,011 204,559
--------------------------------------
Income before taxes and
extraordinary item 15,253,975 13,990,928 12,985,471
Federal income taxes 5,312,400 4,752,600 4,518,903
--------------------------------------
Income before
extraordinary item 9,941,575 9,238,328 8,466,568
Extraordinary item (8,208,097)
--------------------------------------
Net Income $ 1,733,478 $ 9,238,328 $ 8,466,568
======================================
See accompanying notes to financial statements.
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<PAGE>19
Statement of Retained Earnings
For the year ended December 31,
------------------------------------
1995 1994 1993
Balance, January 1 $31,204,319 $28,621,596 $26,244,000
Net income 1,733,478 9,238,328 8,466,568
----------------------------------------
Total 32,937,797 37,859,924 34,710,568
----------------------------------------
Dividends declared:
Preferred stock -
Series A ($5.875 per share) 109,827 109,827 109,827
Series B ($7.80 per share) 48,828 49,141 50,076
Common stock -
Paid to parent company 6,000,015 6,496,637 5,929,069
-----------------------------------------
Total 6,158,670 6,655,605 6,088,972
-----------------------------------------
Balance, December 31 $26,779,127 $31,204,319 $28,621,596
=========================================
See accompanying notes to financial statements.
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<PAGE>20
Statement of Cash Flows
For the year ended December 31,
--------------------------------------
1995 1994 1993
Operating activities:
Net income $ 1,733,478 $ 9,238,328 $ 8,466,568
--------------------------------------
Adjustments to reconcile net
income to net cash
provided by operating
activities -
Extraordinary item 10,675,000
Depreciation and amortization 6,231,913 5,716,417 5,444,826
Changes in operating assets
and liabilities -
Increase in accounts
receivable, accounts
receivable - affiliates and
refundable taxes (1,646,512) (2,602,444) (3,898,521)
Decrease (increase) in
materials and supplies (94,089) 169,429 182,181
Increase in prepayments
(includes prepaid pension) (900,612) (800,000) (360,728)
Decrease in regulated deferred
asset 2,770,676 33,566 651,758
Decrease (increase) in
other assets 105,193 (101,624) 125,004
Decrease in accounts payable,
advances/accounts payable -
affiliates and customer
deposits (1,000,727) (4,273,440) (3,008,896)
Increase in advance billing 76,348 10,388 36,476
Increase in postretirement
benefits obligation 855,349 1,758,176 1,589,000
Increase (decrease) in income
taxes due to parent and interest
accrued 464,922 (193,644) (203,091)
Increase in deferred federal
income taxes (5,338,418) (702,202) (1,552,532)
Increase in other deferred
credits 50,814 62,698 57,076
---------------------------------------
Total adjustments 12,249,857 (922,680) (937,447)
---------------------------------------
Net cash provided by
operating activities 13,983,335 8,315,648 7,529,121
----------------------------------------
Investing activities:
Expenditures for property,
plant and equipment (3,605,285) (3,045,123) (5,089,033)
----------------------------------------
Net cash used in investing
activities (3,605,285) (3,045,123) (5,089,033)
----------------------------------------
<PAGE>
<PAGE>21
Financing activities:
Advances from affiliate 10,300,000
Repayment of advances from affiliate (5,000,000)
Long-term debt acquired 5,900,000 3,000,000
Repayments of long-term debt (8,730,000)
Dividends paid (6,164,498) (8,156,390) (5,861,088)
Retirements of preferred stock (8,000) (8,000) (8,000)
-----------------------------------------
Net cash used in financing
activities (6,172,498) (7,264,390) (1,299,088)
-----------------------------------------
Net increase (decrease) in cash
and cash equivalents 4,205,552 (1,993,865) 1,141,000
Cash and cash equivalents at
beginning of year 621,145 2,615,010 1,474,010
-----------------------------------------
Cash and cash equivalents at
end of year $ 4,826,697 $ 621,145 $ 2,615,010
=========================================
See accompanying notes to financial statements.
<PAGE>
<PAGE>22
FRONTIER COMMUNICATIONS OF NEW YORK, INC.
(A subsidiary of Frontier Corporation)
Notes to Financial Statements
December 31, 1995
- -----------------------------------------------------------------
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Organization
- ------------
Frontier Communications of New York, Inc. (the Company), formerly
Highland Telephone Company, is a subsidiary of Frontier
Corporation (Frontier). Preparation of financial statements in
conformity with generally accepted accounting principles requires
the use of management estimates and assumptions. Actual results
may differ from these estimates. During the third quarter of
1995, the Company discontinued accounting for its operations
under Statement of Financial Accounting Standards No. 71 (SFAS
71), "Accounting for the Effects of Certain Types of Regulation"
(see Note 2).
Certain amounts in the financial statements have been
reclassified to conform with the 1995 presentation.
The following is a summary of significant accounting policies
followed by the Company:
Materials and supplies
- ----------------------
Materials and supplies are stated at the lower of cost or market,
based on average unit cost.
Property, plant and equipment
- -----------------------------
Additions to and replacements of telephone plant are capitalized
at original cost, including costs for benefits and supervision
applicable to construction labor. The cost of depreciable
property units retired, plus removal costs, less salvage, is
charged to accumulated depreciation. Replacements, renewals and
betterments of units of property are capitalized. Replacement of
items not considered units of property and all repairs and
maintenance are charged to operating expense. The Company's
provision for depreciation is based on the composite group method
using estimated service lives of the various classes of plant.
The range of service lives was adjusted during 1995 as a result
of the Company discontinuing the application of SFAS 71 (see Note
2). The current service lives as of December 31, 1995 are as
follows:
Buildings and building improvements 5 to 35 years
Local and toll service lines 12 to 25 years
Furniture, office equipment,
vehicles, tools and other 12 to 20 years
Central office equipment 8 to 13.5 years
Station equipment 10 to 21 years
<PAGE>
<PAGE>23
Allowance for funds used during construction
- --------------------------------------------
The Company includes in its telephone plant accounts an imputed
cost of debt and equity funds used for the construction of
telephone plant and credits such amounts to other income.
Federal income taxes
- --------------------
The Company is included in the consolidated federal income tax
return of its parent, Frontier. The Company pays Frontier for
the federal income tax liability resulting from the filing by
Frontier of its consolidated U.S. federal income tax return,
determined on a separate entity basis. For federal income tax
purposes, the Company takes maximum advantage of available tax
incentives. In addition, certain interest and other costs
capitalized for financial statement purposes are deducted in
computing federal income taxes.
Deferred income taxes are provided by regulated operations in
compliance with the normalization provisions of current tax law
and regulatory orders. The major temporary differences reflected
in the deferred tax liability are depreciation and investment tax
credits. Excess deferred taxes applicable to telephone
operations are amortized in compliance with the normalization
provisions of current tax law and regulatory orders. This
amortization is normalized over the same time period as the
related asset generating the deferral (see Note 2).
Regulatory asset
- ----------------
FAS 109 requires that a regulatory asset and a deferred tax
liability be recognized to reflect the probable increase in
future revenue and an increase in future tax expense which will
be recognized as the result of a reversal of temporary
differences which decreased tax expense when originally incurred.
The regulatory asset and deferred tax liability also includes a
gross-up for taxes which will be incurred as the result of the
future increase in revenue (see Note 2).
Deferred investment credits
- ---------------------------
Deferred investment credits are included in income as a reduction
of income tax expense over the estimated useful lives of the
assets that gave rise to the credits. Income tax expense for
1995, 1994, and 1993 has been reduced by $213,700, $224,500, and
$236,700, respectively, resulting from the amortization of such
investment credits.
Cash flows
- ----------
For purposes of the Statement of Cash Flows, the Company
considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents.
<PAGE>
<PAGE>24
Actual interest paid was $391,741, $769,569, and $872,139 in
1995, 1994 and 1993, respectively. In addition, actual federal
income taxes remitted to the parent company were $5,114,000 in
1995, $5,676,000 in 1994, and $5,416,000 in 1993.
NOTE 2 - DISCONTINUATION OF REGULATORY ACCOUNTING PRINCIPLES:
The Company determined in 1995 that SFAS 71 was no longer
applicable based upon changes in regulation, increasingly rapid
advancements in telecommunications technology and other factors
creating competitive markets. The Company does not believe with
any certainty that prices can be maintained at levels that will
recover its costs.
As a result of the discontinuance of SFAS 71, the Company
recorded a non-cash extraordinary charge of $8,208,097, net of an
income tax benefit of $2,466,903 as of September 30, 1995. The
components of the extraordinary charge follows:
Pre-tax After-tax
Increase to the accumulated
depreciation balance $11,425,000 $ 7,426,250
Elimination of regulatory liability (750,000) (487,500)
Elimination of regulatory tax asset 1,974,542
Accelerated amortization of deferred
investment tax credits (705,195)
------------------------
Total $10,675,000 $ 8,208,097
========================
The adjustment of $11,425,000 to net plant was necessary because
estimated useful lives and depreciation methods historically
prescribed by regulators did not keep up with the rapid pace of
technological changes in the Company and differed significantly
from those used by unregulated enterprises. Net plant balances
were adjusted by increasing the accumulated depreciation balance.
The increase to the accumulated depreciation balance was
determined by a depreciation reserve study that identified
inadequate accumulated depreciation levels by individual asset
categories. The Company believes these levels developed over the
years as a result of the systematic underdepreciation of assets
resulting from the regulatory process.
When adjusting its net telephone plant, the Company gave effect
to shorter, more economically realistic lives. These depreciable
lives were benchmarked against industry standards and also
reviewed with independent telecommunications technology
consultants. The discontinuance of FAS 71 also required the
Company to eliminate for financial reporting the effects of any
actions of regulators that had been previously recognized as
regulatory assets and liabilities pursuant to FAS 71.
<PAGE>
<PAGE>25
Tax-related adjustments were required to adjust excess deferred
tax levels to the currently enacted statutory rates and to
eliminate tax-related regulatory assets and liabilities. Prior
to the discontinuance of FAS 71, the Company had recorded
deferred income taxes on the cumulative amount of tax benefits
previously flowed through to ratepayers and recorded a regulatory
asset for the same amount. Also, the Company had recorded a
regulatory liability for the difference between deferred taxes at
higher historical tax rates than with those currently enacted.
At the time the Company discontinued the application of FAS 71,
the above tax-related regulatory assets and liabilities were
eliminated and deferred tax balances adjusted to reflect the
application of FAS 109 consistent with unregulated enterprises.
In addition to these tax impacts, the Company, prior to the
discontinuance of FAS 71, used the deferral method of accounting
for investment tax credits. This method provided for the
amortization of the credits as a reduction to tax expense over
the life of the assets that gave rise to the tax credit.
NOTE 3 - PROPERTY, PLANT AND EQUIPMENT:
Telephone plant in service and under construction are stated at
cost. Listed below are the major classes of telephone plant in
service as of December 31:
1995 1994 1993
Land and buildings $ 7,987,335 $ 8,014,085 $ 7,997,598
Local and toll service
lines 48,928,255 47,348,672 45,716,820
Furniture, office equipment,
vehicles, tools and other 5,749,829 5,305,425 5,347,342
Central office equipment 40,882,635 40,620,052 38,876,095
Station equipment 2,811,475 2,758,860 2,660,739
---------------------------------------
$106,359,529 $104,047,094 $100,598,594
=======================================
NOTE 4 - CAPITALIZATION:
Common shareowner's equity
- --------------------------
On March 31, 1976, Frontier was granted approval by the PSC to
obtain all of the Company's outstanding common stock in
accordance with an agreement and plan of merger between the
Company and Frontier. Subsequent to the merger, Frontier has
contributed $7,005,266 in additional capital to the Company. All
of the outstanding shares of common stock of the Company are held
by Frontier.
<PAGE>
<PAGE>26
Preferred shareowners' equity
- -----------------------------
The 5-7/8% Series A is redeemable only at the option of the
Company at par plus unpaid accumulated dividends. The 7.8%
Series B is redeemable at par plus varying premium rates and any
unpaid accumulated dividends. The redemption price plus premiums
for Series B ranges from $100.80 to $105.00. During 1995, 1994
and 1993, 80 shares of Series B were redeemed in each year.
Owners of preferred shares are entitled to voting rights under
certain circumstances.
NOTE 5 - LONG-TERM DEBT:
In 1993, the Company entered into a promissory note payable to
Frontier for $3,000,000. Interest is due monthly at a rate of
6.5% per annum, and the principal is due in 2003. In 1994, the
Company received $5,900,000 in advances from Frontier. In 1995,
the Company entered into a ten-year loan agreement with Frontier
to refinance these advances. Interest is due monthly at a rate
of 8.4% per annum.
NOTE 6 - FEDERAL INCOME TAXES:
Components of federal income taxes are:
1995 1994 1993
Current $5,413,265 $5,421,235 $5,532,903
Deferred (100,865) (668,635) (1,014,000)
----------------------------------
$5,312,400 $4,752,600 $4,518,903
==================================
The following is a reconciliation between federal income tax
expense and tax computed on income before federal income tax at
the applicable statutory rate:
1995 1994 1993
---------- ----------- ----------
Amount % Amount % Amount %
Tax expense at
statutory rate $5,339,000 35.0% $4,897,000 35.0% $4,545,000 35.0%
Accelerated
depreciation 233,400 1.5 173,600 1.2 239,400 1.8
Cost of removal (20,200) (.1) (16,000) (.1)
Investment tax
credit (213,700)(1.4) (224,500) (1.6) (236,700) (1.8)
Other, net (46,300) (.3) (73,300) (.5) (12,797) (.1)
------------------------------------------------------
$5,312,400 34.8% $4,752,600 34.0% $4,518,903 35.0%
======================================================
<PAGE>
<PAGE>27
Deferred tax liabilities (assets) are comprised of the following
at December 31:
1995 1994 1993
Accelerated depreciation $6,615,919 $11,354,805 $11,300,305
Investment tax credit 865,470 1,089,970
MTA taxes 126,766 135,833 121,733
Pension 466,900 176,300
Other 43,169 30,186 25,379
-----------------------------------
Gross deferred tax liabilities 7,252,754 12,562,594 12,537,387
-----------------------------------
Partnership losses (205,200) (171,400) (189,000)
Rate case (193,096) (156,496)
Insurance reserve (43,380) (36,500) (35,100)
Moratorium (41,900) (20,000)
Bad debt expense (37,800) (148,200) (70,400)
ROE excess (64,678) (64,678) (64,678)
Postretirement benefit
obligations (1,600,829) (1,177,620) (556,200)
Overearnings (241,598) (256,400)
Reorganization charges (83,582)
Other (69,201) (1,100) (409)
------------------------------------
Gross deferred tax assets (2,104,670) (2,076,092) (1,348,683)
------------------------------------
Total deferred income taxes $5,148,084 $10,486,502 $11,188,704
====================================
NOTE 7 - PENSION PLAN:
The Company, through its defined benefit plan, provides
retirement benefits for substantially all full-time employees.
Qualified employees of Frontier Communications of AuSable Valley,
Inc., Frontier Communications of Seneca Gorham, Inc. and Frontier
Communications of Sylvan Lake, Inc., affiliates, are also
eligible to participate in the Company's pension plan.
The plan's funded status is as follows:
December 31,
--------------------------
1995 1994 1993
(In thousands of dollars)
Actuarial present value of benefit obligations:
Vested benefit obligations $24,058 $17,280 $17,760
------------------------
Accumulated benefit obligations $25,300 $18,365 $19,097
-----------------------
<PAGE>
<PAGE>28
Plan assets at fair value,
primarily common stock $29,221 $24,672 $25,632
Projected benefit obligation 25,536 20,260 21,790
------------------------
Plan assets in excess of
projected benefit obligation 3,685 4,412 3,842
Unrecognized net loss 757 669 639
Unrecognized net transition asset (1,667) (1,900) (2,134)
Unrecognized prior service cost 728 502 714
Regulatory adjustment (2,017) (2,305) (2,593)
(Prepaid) accrued pension (benefit)
cost actuarially allocated to other
participating subsidiaries 641 (75) (62)
------------------------
Net prepaid pension benefit $2,127 $1,303 $ 406
========================
Net periodic pension cost consists of the following:
December 31,
-------------------------
1995 1994 1993
(In thousands of dollars)
Service cost - benefits earned
during the period $ 394 $ 465 $ 604
Interest cost on projected
benefit obligation 1,738 1,598 1,492
Net amortization and deferral 3,407 (2,838) 400
Actual return on plan assets (5,685) 445 (2,618)
-----------------------
Net periodic pension benefit (146) (330) (122)
Benefit due to regulatory agency actions (288) (288) (288)
Amount expensed due to curtailment 501
Net periodic pension cost actuarially
allocated to other participating
subsidiaries (805) (83) (149)
----------------------
Net periodic pension benefit recognized
by Frontier Communications of
New York, Inc. $ (738) $(701) $(559)
======================
The projected benefit obligations at December 31, 1995, 1994 and
1993 were determined using assumed discount rates of 7.5%, 8.5%
and 7.25%, respectively, and assumed rates of increase in future
compensation levels of 5%, 5.5% and 5%, respectively. The
expected weighted average long-term rate of return on assets was
assumed to be 9% for each of these years. The unrecognized net
transition asset as of January 1, 1987 is being amortized over 14
years, the estimated remaining service lives of employees.
<PAGE>
<PAGE>29
The Company's funding policy is to make contributions for pension
benefits based on actuarial computations which reflect the
long-term nature of the pension plan. However, under Financial
Accounting Standards Board Statement No. 87 (FAS 87), "Employers'
Accounting for Pensions," the development of the projected
benefit obligation essentially is computed for financial
reporting purposes and may differ from the actuarial
determination for funding due to varying assumptions and methods
of computation.
NOTE 8 - POSTRETIREMENT BENEFITS OTHER THAN PENSIONS:
The Company provides health care, life insurance, and certain
other retirement benefits for substantially all employees. Plan
assets consist principally of life insurance policies and money
market instruments. In adopting FAS 106, the Company elected to
defer the recognition of the transition benefit obligation of
$11.3 million over a period of twenty years. The cost of
postretirement benefits was recognized as determined under the
projected unit credit actuarial method.
The status of the plan as of December 31 follows:
1995 1994 1993
Accumulated postretirement benefit obligation
(APBO) attributable to:
Retirees $6,642,000 $ 8,070,000 $5,911,000
Fully eligible plan participants 971,000 1,458,000 1,491,000
Other active plan participants 3,350,000 4,659,000 4,661,000
----------------------------------
Total APBO 10,963,000 14,187,000 12,063,000
Plan assets at fair value - 0 - - 0 - - 0 -
----------------------------------
APBO in excess of plan assets 10,963,000 14,187,000 12,063,000
Unrecognized transition obligation 8,907,000 10,141,000 10,704,000
Unrecognized net (gain) loss (2,146,525) 698,824 (230,000)
----------------------------------
Accrued postretirement
benefit obligation $ 4,202,525 $ 3,347,176 $ 1,589,000
==================================
The components of the estimated postretirement benefit cost at
December 31 follows:
1995 1994 1993
Service cost $ 233,000 $ 402,000 $ 386,000
Interest on APBO 831,000 1,064,000 890,000
Amortization of transition
obligation 557,000 563,000 563,000
Amortization of gains and losses (252,000) 215,000
--------------------------------
Net postretirement benefit
cost $1,369,000 $2,244,000 $1,839,000
=================================
<PAGE>
<PAGE>30
To estimate these costs, health care costs were assumed to
increase 11.2% in 1996 and 1995 and 12.0% in 1994 with the rate
of increase declining to 5.75% by 2006 and thereafter. The
weighted discount rate was assumed to be 8.5% for December 31,
1995 and 1994 and 8.75% for December 31, 1993 and the salary
increase rates were assumed to be 5.0%, 5.5% and 5.0%,
respectively. If the health care cost trend rates were increased
by one percentage point, the accumulated postretirement benefit
health care obligation as of December 31, 1995 would increase by
$1.09 million while the sum of the service and interest cost
components of the net postretirement benefit health care cost for
1995 would increase by $131,000.
NOTE 9 - POSTEMPLOYMENT BENEFITS:
In 1992, the Financial Accounting Standards Board released
Statement No. 112, "Employers' Accounting for Postemployment
Benefits" (FAS 112), which is required to be implemented by
January 1, 1994. FAS 112 requires that projected future costs of
providing postemployment, but preretirement benefits, such as
disability, prepension leave (salary continuation) and severance
pay, be recognized as an expense as employees render service
rather than when the benefits are paid.
The Company adopted the provisions of FAS 112 effective January
1, 1994 which resulted in an immaterial effect on the financial
statements.
NOTE 10 - TRANSACTIONS WITH AFFILIATED COMPANIES:
The advances/accounts payable - affiliates balance includes
$2,400,000 at December 31, 1994, and $13,300,000 at December 31,
1993, for funds advanced to the Company by Frontier. There were
no liabilities to Frontier as of December 31, 1995. Interest
paid on these funds was $390,310 in 1995, $550,900 in 1994, and
$324,000 in 1993, respectively. The remainder of the balance
relates primarily to purchases of supplies and services from
Frontier and other related subsidiaries at prices considered to
be as favorable as those available from other sources.
Frontier Long Distance of New York, Inc. (FLD), an affiliate of
Frontier, provides long distance service for the Company's
customers. Approximately $6.3 million of the December 31, 1995
accounts receivable - affiliates balance relates to charges for
access services, billing and collection services, and sales and
marketing costs paid on behalf of FLD. In addition,
approximately $6.8 million of the accounts payable - affiliates
balance relates to the remittance of amounts billed to customers
by the Company for long distance and cellular services on behalf
of FLD.
<PAGE>
<PAGE>31
The Company paid $1,828,831 in 1995, $2,159,819 in 1994 and
$2,178,302 in 1993, to Frontier for allocated corporate charges
primarily for executive, legal and financial assistance. The
amount due from affiliates relates to customer and administrative
services provided to other subsidiaries of Frontier. The Company
also paid $2,712,427 and $2,373,916 to an affiliate, Frontier
Information Technologies for data processing services during 1995
and 1994, respectively.
Cash and cash equivalents include $- 0 -, $779,610, and
$2,300,000 in investments held by Frontier on behalf of the
Company at December 31, 1995, 1994 and 1993, respectively.
NOTE 11 - RATE MORATORIUM:
The Company finalized a settlement agreement in 1990 with the
Public Service Commission providing for an extension of a rate
case moratorium which expired on December 31, 1989. Under the
agreement extension, the Company agreed not to file for a general
rate increase that would become effective prior to January 1,
1992. As part of this moratorium agreement, the Company was
required to defer, for the customer's benefit, tax savings
resulting from the Tax Reform Act of 1986 as well as the
customer's share, under a sharing mechanism, of any earnings in
excess of a threshold percent of equity during 1990 and 1991.
The terms of this agreement expired December 31, 1991, but
$768,060 remained as a deferred credit at September 30, 1995.
During the third quarter of 1995, the Company discontinued
accounting for its operations under SFAS 71 (see Note 2). In
conjunction with the discontinuance, the rate moratorium deferred
credit was reversed and included in the non-cash extraordinary
charge.
NOTE 12 - OPERATING LEASES:
The Company has noncancellable leases for computer hardware and
office equipment. Minimum annual rental commitments at December
31, 1995 are as follows:
1996 $17,264
1997 8,434
1998 8,434
1999 3,514
--------
$37,646
========
Total rental costs were $30,387 for 1995, $35,255 for 1994, and
$341,730 for 1993.
<PAGE>
<PAGE>32
<TABLE>
Stock Prices and Dividends Declared
Since the common and preferred stocks of Frontier Communications of New York, Inc. are not actively traded,
neither sales prices nor bid and asked quotations are readily available.
Quarterly cash dividends per share declared during 1995, 1994 and 1993 were as follows:
Preferred stock
--------------------------------------------
Common stock* Series A - 5-7/8% Series B - 7.8%
-------------------- ----------------------- -------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Quarter 1995 1994 1993 1995 1994 1993 1995 1994 1993
First $ 3.16 $ 2.63 $1.46875 $1.46875 $1.46875 $1.95 $1.95 $1.95
Second 2.92 1.46875 1.46875 1.46875 1.95 1.95 1.95
Third 3.19 1.46875 1.46875 1.46875 1.95 1.95 1.95
Fourth $11.84 9.66 2.96 1.46875 1.46875 1.46875 1.95 1.95 1.95
---------------------------------------------------------------------------
$11.84 $12.82 $11.70 $5.87500 $5.87500 $5.87500 $7.80 $7.80 $7.80
===========================================================================
* To parent company, Frontier Corporation, all of which shares are held by such parent.
This report on Form 10(k) is filed pursuant to a partial exemption from the reporting
requirements of the Securities Exchange Act of 1934 approved by the Division of Corporation
Finance of the Securities and Exchange Commission.
</TABLE>
<PAGE>
<PAGE>33
Frontier Communications of New York, Inc.
P.O. Box 657
145 North Main Street
Monroe, New York 10950
Telephone: (914) 783-5226
<PAGE>
<PAGE>34
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Date: March 22,1996 FRONTIER COMMUNICATIONS OF
NEW YORK, INC.
/s/ Jeremiah T. Carr
By: ----------------------------
Jeremiah T. Carr
President and Chief Executive
Officer
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the Registrant and in the capacities and on
the dates indicated.
/s/ Ronald L. Bittner
Date: March 22, 1996 By: ---------------------------
Ronald L. Bittner
Director
/s/ Jeremiah T. Carr
Date: March 22, 1996 By: ---------------------------
Jeremiah T. Carr
Director, President and Chief
Executive Officer
/s/ Marvin C. Moses
Date: March 22, 1996 By: ---------------------------
Marvin C. Moses
Director (principal financial
officer)
/s/ Louis L. Massaro
Date: March 22, 1996 By: ---------------------------
Louis L. Massaro
Director
/s/ Robert J. DePalma
Date: March 22, 1996 By: ---------------------------
Robert J. DePalma
(principal accounting officer)
<PAGE>
<PAGE>35
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
27 Financial Data Schedule Filed herewith
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
FRONTIER COMMUNICATIONS OF NEW YORK, INC.'S FINANCIAL STATEMENTS FOR
THE YEAR ENDED DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000047417
<NAME> FRONTIER COMMUNICATIONS OF NEW YORK, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 4,827
<SECURITIES> 0
<RECEIVABLES> 16,772
<ALLOWANCES> 0
<INVENTORY> 345
<CURRENT-ASSETS> 590
<PP&E> 107,916
<DEPRECIATION> 60,509
<TOTAL-ASSETS> 72,137
<CURRENT-LIABILITIES> 14,645
<BONDS> 0
0
2,493
<COMMON> 2,280
<OTHER-SE> 34,468
<TOTAL-LIABILITY-AND-EQUITY> 72,137
<SALES> 0
<TOTAL-REVENUES> 44,424
<CGS> 0
<TOTAL-COSTS> 28,465
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 797
<INCOME-PRETAX> 15,254
<INCOME-TAX> 5,312
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> (8,208)
<CHANGES> 0
<NET-INCOME> 1,734
<EPS-PRIMARY> 3.11
<EPS-DILUTED> 3.11
</TABLE>
