<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
(AMENDMENT NO. 1)
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 9, 1995
---------------
TCA Cable TV, Inc.
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Texas 0-11478 75-1798185
-------------- ------------ --------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation File Number) Identification No.)
3015 S.S.E. Loop 323, Tyler, Texas 75701
---------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (903) 595-3701
----------------
<PAGE> 2
Reference is made to the Current Report on Form 8-K (the "Form 8-K")
filed by TCA Cable TV, Inc. on May 24, 1995. The Form 8-K is hereby amended to
read in its entirety as follows:
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On January 20, 1995, Tele-Communications of Northwest Arkansas Limited
Partnership ("TCNA LP") entered into an asset purchase agreement (as amended,
the "Fayetteville Agreement") with Time Warner Entertainment Company, L.P.
("Time Warner"), through its division Time Warner Cable Ventures pursuant to
which TCNA LP would acquire the assets of, and assume certain liabilities
related to, the operation of cable television systems (the "Fayetteville
System") in and around the following cities in Arkansas: Fayetteville, Elkins,
Farmington, Greenland, and unincorporated areas of Washington County (the
"Fayetteville Transaction").
TCA Cable TV, Inc. (the "Company") indirectly through various
subsidiaries (i) is an 80% limited partner of TCNA LP and (ii) (A) owns a 49%
limited partnership interest in the 20% general partner of TCNA LP and (B) owns
49% of the 51% general partner of the 20% general partner of TCNA LP.
The Fayetteville Transaction was consummated on May 9, 1995.
The assets acquired in the Fayetteville Transaction included, with
certain exceptions as set forth in the Fayetteville Agreement, all of the
assets and properties, real and personal, tangible and intangible, used by Time
Warner in its operation of the Fayetteville System. TCNA LP intends to
continue to use such assets to provide cable television services to the
subscribers in the Fayetteville System. As part of the Fayetteville
Transaction, Time Warner entered into a noncompetition agreement, pursuant to
which Time Warner agreed, with certain specified exceptions, not to own or
provide service to any cable system or other entity engaged in the use of a
competing technology, broadcast television or newspaper publishing that
provides services to customers within 50 miles of the location of the headend
of the Fayetteville System.
The aggregate consideration paid in the Fayetteville Transaction was
approximately $39,060,000, subject to certain post closing adjustments as set
forth in the Fayetteville Agreement. The acquisition consideration for the
Fayetteville Transaction were determined by negotiations between the parties to
the agreements.
To the best knowledge of the Company, there is no material
relationship between Time Warner and the Company, or any of its affiliates, any
director or officer of the Company, or any associate of such director or
officer.
The primary sources of funds used in the Fayetteville Transaction were
unsecured loans extended by NationsBank of Texas, N.A. and Texas Commerce Bank,
N.A. to the Company and subsequent loans and capital contributions from
subsidiaries of the Company to TCNA LP.
2
<PAGE> 3
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements
Audited statement of assets, liabilities and net assets of Warner
Cable Communications-Fayetteville, Arkansas Division, a division of Time Warner
Entertainment Company, L.P. ("Time Warner-Fayetteville"), as of December 31,
1994, and the related statements of revenues and expenses and changes in net
assets and cash flows for the year then ended along with the unaudited
statement of assets, liabilities, and net assets of Time Warner-Fayetteville,
as of March 31, 1995 and 1994, and the related statements of revenues and
expenses and changes in net assets and cash flows for the three months then
ended are attached hereto as Annex A and made a part hereof.
(b) Pro Forma Financial Information
The following unaudited Pro Forma Balance Sheet of the Company and
Subsidiaries attached hereto as Annex B has been adjusted to give effect to the
purchase of the Fayetteville System on May 9, 1995, through TCNA LP as though
such purchase had occurred on January 31, 1995. The unaudited Pro Forma
Statements of Operations of the Company and Subsidiaries for the three months
ended January 31, 1995, and the year ended October 31, 1994 also attached
hereto as Annex B present the historical results of the Company as if TCNA LP
had purchased the Fayetteville System on November 1, 1993. Such pro forma
information is not necessarily indicative of operating results that would have
been achieved had the purchase been consummated at the beginning of the
respective periods presented and should not be construed as representative of
future operations.
The unaudited Pro Forma Financial Statements should be read in
conjunction with the historical Financial Statements of the Company and the
financial statements included in Item 7(a) herein. The unaudited historical
Financial Statements of the Company for the three months ended January 31, 1995
include, in the opinion of management, all adjustments necessary for a fair
presentation of the results of such periods.
(c) Exhibits.
The following is a list of exhibits filed as part of this Current
Report on Form 8-K:
Exhibit No. Description
2.1 Asset Purchase Agreement, dated January 20, 1995, between
Tele-Communications of Northwest Arkansas Limited
Partnership and Time Warner Entertainment Company, L.P.,
through its division Time Warner Cable Ventures.(1)
2.2 Letter Agreement, dated April 24, 1995, between
Tele-Communications of Northwest Arkansas Limited
Partnership and Time Warner
3
<PAGE> 4
Entertainment Company, L.P., through its division Time
Warner Cable Ventures, amending Asset Purchase Agreement.(2)
23.1 Consent of Ernst & Young LLP.(3)
__________________
(1) Previously filed as an exhibit to the Company's annual
report on Form 10-K for the year ended October 31, 1994 and
incorporated herein by reference.
(2) Previously filed as an exhibit to the Company's Current
Report on Form 8-K filed May 24, 1995 and incorporated
herein by reference.
(3) Filed herewith.
4
<PAGE> 5
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 hereunto duly authorized.
TCA CABLE TV, INC.
Date: September 11, 1995 By: /s/ JIMMIE F. TAYLOR
------------------------------------
Jimmie F. Taylor
Its: VP, CFO & Treasurer
----------------------------------
5
<PAGE> 6
ANNEX A
<PAGE> 7
[LOGO] ________________________________________
Financial Statements
WARNER CABLE COMMUNICATIONS-
FAYETTEVILLE, ARKANSAS DIVISION
A Division of Time Warner
Entertainment Company, L.P.
Year Ended December 31, 1994
with Report of Independent Auditors
ERNST & YOUNG LLP
<PAGE> 8
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
FINANCIAL STATEMENTS
Year ended December 31, 1994
CONTENTS
<TABLE>
<S> <C>
Report of Independent Auditors . . . . . . . . . . . . . . . . . . 1
Audited Financial Statements
Statement of Assets, Liabilities and Net Assets . . . . . . . . . . 2
Statement of Revenues and Expenses and Changes in Net Assets . . . 3
Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . 4
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . 5
</TABLE>
<PAGE> 9
REPORT OF INDEPENDENT AUDITORS
Time Warner Entertainment Company, L.P.
Stamford, Connecticut
We have audited the accompanying statement of assets, liabilities and net
assets of Warner Cable Communications-Fayetteville, Arkansas Division, a
division of Time Warner Entertainment Company, L.P., as of December 31, 1994,
and the related statements of revenues and expenses and changes in net assets
and cash flows for the year then ended. These financial statements are the
responsibility of the Division's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit 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 audit provides a reasonable basis
for our opinion.
Warner Cable Communications-Fayetteville, Arkansas Division is a part of Time
Warner Entertainment Company, L.P., and has no separate legal status or
existence. Transactions with Time Warner Entertainment Company, L.P., and
other affiliates are described in Note 3.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets, liabilities and net assets of Warner Cable
Communications-Fayetteville, Arkansas Division, a division of Time Warner
Entertainment Company, L.P., at December 31, 1994, and its revenue and expenses
and changes in net assets and cash flows for the year then ended in conformity
with generally accepted accounting principles.
/s/ Ernst & Young LLP
August 11, 1995
1
<PAGE> 10
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
STATEMENT OF ASSETS, LIABILITIES AND NET ASSETS
December 31, 1994
<TABLE>
<S> <C>
ASSETS
Cash $ 64,929
Accounts receivable, less allowance for doubtful
accounts of $30,952 286,339
Prepaid expenses and other assets 17,966
Property, plant and equipment, at cost (Note 2):
Land, building and improvements 84,646
Distribution system 10,069,054
Vehicles and other equipment 389,728
Construction in progress 4,857
------------
10,548,285
Less accumulated depreciation (5,070,574)
Net property, plant and equipment 5,477,711
------------
Franchise costs, less accumulated amortization of
$705,634 (Note 2) 73,417
------------
$ 5,920,362
============
LIABILITIES AND NET ASSETS
Accounts payable $ 81,272
Accrued liabilities 609,136
Subscribers' advance payments 232,327
Net assets (Note 1) 4,997,627
------------
$ 5,920,362
============
</TABLE>
See accompanying notes.
2
<PAGE> 11
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
STATEMENT OF REVENUES AND EXPENSES AND CHANGES IN NET ASSETS
Year ended December 31, 1994
<TABLE>
<S> <C>
Revenues:
Service $5,430,650
Connection and other 930,833
----------
6,361,483
Expenses:
Programming 1,432,390
Plant and operating 1,014,346
General and administrative 404,893
Marketing and advertising 162,031
Corporate overhead 476,369
Depreciation and amortization (Note 2) 936,159
Gain on sale of fixed assets, net (8,594)
----------
4,417,594
----------
Operating income 1,943,889
Interest expense 192,862
----------
Net income 1,751,027
Net assets at beginning of year 5,185,024
Net payments to Time Warner Entertainment
Company, L.P. (Note 3) (1,938,424)
----------
Net assets at end of year $4,997,627
==========
</TABLE>
See accompanying notes.
3
<PAGE> 12
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
STATEMENT OF CASH FLOWS
Year ended December 31, 1994
<TABLE>
<S> <C>
OPERATING ACTIVITIES
Net income $ 1,751,027
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 936,159
Changes in noncash working capital:
Accounts receivable, prepaid
expenses, and other assets (157,016)
Accounts payable, accrued liabilities, and
subscribers' advance payments 196,502
-----------
Net cash provided by operating activities 2,726,672
INVESTING ACTIVITIES
Purchases of property, plant and equipment, net (760,665)
FINANCING ACTIVITIES
Net payments to Time Warner Entertainment
Company, L.P. (Note 3) (1,938,424)
-----------
Net increase in cash 27,583
Cash at beginning of year 37,346
-----------
Cash at end of year $ 64,929
===========
</TABLE>
See accompanying notes.
4
<PAGE> 13
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
NOTES TO FINANCIAL STATEMENTS
December 31, 1994
1. DESCRIPTION OF BUSINESS
Warner Cable Communications-Fayetteville, Arkansas Division (the Division), a
division of Time Warner Entertainment Company, L.P. (TWE), is principally
engaged in the cable television business. Such operations consist primarily of
selling video programming which is distributed to subscribers for a monthly fee
through a network of coaxial cables. The Division operates in several cities
and surrounding areas under non-exclusive franchise agreements as follows:
<TABLE>
<CAPTION>
FRANCHISING AREA FRANCHISE AGREEMENT EXPIRATION
----------------- ------------------------------
<S> <C>
City of Elkins 2/10/05
City of Fayetteville 10/31/95
County of Washington 10/13/99
City of Farmington 12/15/99
City of Springdale 7/27/07
City of Greenland 5/12/06
</TABLE>
The Division has no separate legal status or existence. The Division's
resources and existence are at the disposal of TWE management, subject to
contractual commitments by TWE to perform certain long-term contracts within
the present divisional structure. The Division's assets are legally available
for the satisfaction of debts of TWE, not solely those appearing in the
accompanying statements, and its debts may result in claims against assets not
appearing therein. The Division is one of several divisions and affiliates of
TWE, and transactions and the terms thereof may be arranged by and among
members of the affiliated group.
2. SIGNIFICANT ACCOUNTING POLICIES
PROPERTY, PLANT AND EQUIPMENT
Depreciation is provided on the straight-line basis over the estimated useful
lives of the assets as follows:
<TABLE>
<S> <C>
Building and improvements 10-25 years
Distribution system 3-15 years
Vehicles and other equipment 3-10 years
</TABLE>
5
<PAGE> 14
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
FRANCHISE COSTS
The Division has deferred costs incurred to acquire the franchise. Amortization
of these costs is provided on the straight-line basis over the terms of the
franchise agreement.
STATEMENT OF CASH FLOWS
For purposes of this statement, cash includes all highly liquid investments
purchased with original maturities of three months or less.
INCOME TAXES
As a U.S. partnership, TWE is not subject to federal and state income taxation.
As a result, a provision for income taxes has not been included in the
financial statements.
3. RELATED PARTY TRANSACTIONS
Interest charged to the Division by TWE was computed by multiplying a portion
of the Division's average net assets by the average interest rate on TWE's
outstanding borrowings. Interest charged to the Division aggregated $192,862
for the year ended December 31, 1994.
The Division records charges for a portion of TWE's selling, general and
administrative expenses ($476,369 for the year ended December 31, 1994), which
are allocated by TWE to its divisions and affiliates based upon subscriber
levels.
The statement of revenues and expenses and changes in net assets includes
charges for programming and promotional services provided by Home Box Office
and other affiliates of TWE. These charges are based upon customary rates.
6
<PAGE> 15
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. LEASES
Rental expenses for all operating leases, principally pole attachments, for the
year ended December 31, 1994, amounted to $45,936. The Division has no
significant noncancellable rental commitments.
5. BENEFIT PLANS
The Division participates in a noncontributory defined benefit pension plan
(the Pension Plan) which is maintained by TWE and covers substantially all
employees. Benefits under the Pension Plan are determined based on formulas
which reflect the employees' years of service and average compensation for the
highest five consecutive years of the last ten years of service. Total pension
cost for the year ended December 31, 1994, was $23,854.
The Division also participates in a defined contribution plan maintained by TWE
(The Time Warner Cable Employees' Savings Plan-Savings Plan) which covers
substantially all employees. The Division's contributions to the Savings Plan
can amount to up to 6.67% of the employee's eligible compensation during the
plan year. The plan sponsor has the right in any year to set the maximum
amount of the Division's contribution. Defined contribution plan expense
totaled $5,568 for the year ended December 31, 1994.
6. SUBSEQUENT EVENT
Effective at the close of business on May 9, 1995, TWE sold all of the assets
of the Division.
7
<PAGE> 16
[LOGO] __________________________________________
Unaudited Financial Statements
WARNER CABLE COMMUNICATIONS-
FAYETTEVILLE, ARKANSAS DIVISION
A Division of Time Warner
Entertainment Company, L.P.
Three months ended March 31, 1995 and 1994
ERNST & YOUNG LLP
<PAGE> 17
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
UNAUDITED FINANCIAL STATEMENTS
Three Months ended March 31, 1995 and 1994
CONTENTS
<TABLE>
<S> <C>
Unaudited Financial Statements
Statements of Assets, Liabilities and Net Assets . . . . . . . . . . . 1
Statements of Revenues and Expenses and Changes in Net Assets . . . . 2
Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . 3
</TABLE>
<PAGE> 18
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
STATEMENTS OF ASSETS, LIABILITIES AND NET ASSETS
<TABLE>
<CAPTION>
MARCH 31
1995 1994
-------------------------------
(Unaudited)
<S> <C> <C>
ASSETS
Cash $ 44,684 $ 50,886
Accounts receivable, less allowance for doubtful
accounts of $35,172 and $52,132 in 1995 and 1994,
respectively 450,893 294,996
Prepaid expenses and other assets 24,228 42,313
Property, plant and equipment, at cost:
Land, building and improvements 84,646 84,646
Distribution system 10,199,750 9,416,913
Vehicles and other equipment 412,195 366,615
Construction in progress 73,385 126,150
-------------------------------
10,769,976 9,994,324
Less accumulated depreciation (5,302,239) (4,455,424)
-------------------------------
Net property, plant and equipment 5,467,737 5,538,900
Franchise costs, less accumulated amortization of
$717,759 and $669,058 in 1995 and 1994,
respectively 61,292 109,993
-------------------------------
$ 6,048,834 $ 6,037,088
===============================
LIABILITIES AND NET ASSETS
Accounts payable $ 96,253 $ 90,081
Accrued liabilities 733,084 473,406
Subscribers' advance payments 403,979 327,600
Net assets 4,815,518 5,146,001
-------------------------------
$ 6,048,834 $ 6,037,088
===============================
</TABLE>
1
<PAGE> 19
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
STATEMENTS OF REVENUES AND EXPENSES AND CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31
1995 1994
(Unaudited)
-------------------------------
<S> <C> <C>
Revenues:
Service $1,586,517 $1,421,368
Connection and other 273,285 212,620
-------------------------------
1,859,802 1,633,988
Expenses:
Programming 412,965 321,051
Plant and operating 255,555 248,108
General and administrative 108,039 100,795
Marketing and advertising 39,931 38,767
Corporate overhead 135,354 118,317
Depreciation and amortization 238,283 230,094
Gain on sale of fixed assets, net (18,788) (18,994)
-------------------------------
1,171,339 1,038,138
-------------------------------
Operating income 688,463 595,850
Interest expense 47,345 49,602
-------------------------------
Net income 641,118 546,248
Net assets at beginning of period 4,997,627 5,185,024
Net payments to Time Warner Entertainment
Company, L.P. (823,227) (585,271)
-------------------------------
Net assets at end of period $4,815,518 $5,146,001
===============================
</TABLE>
2
<PAGE> 20
WARNER CABLE COMMUNICATIONS-FAYETTEVILLE, ARKANSAS DIVISION
A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY, L.P.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31
1995 1994
--------------------------------
(Unaudited)
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 641,118 $ 546,248
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 238,283 230,094
Changes in noncash working capital:
Accounts receivable, prepaid
expenses, and other assets (170,816) (190,020)
Accounts payable, accrued liabilities, and
subscribers' advance payments 310,581 164,854
--------------------------------
Net cash provided by operating activities 1,019,166 751,176
INVESTING ACTIVITIES
Purchases of property, plant and equipment, net (216,184) (152,365)
FINANCING ACTIVITIES
Net payments to Time Warner Entertainment
Company, L.P. (823,227) (585,271)
--------------------------------
Net increase (decrease) in cash (20,245) 13,540
Cash at beginning of period 64,929 37,346
--------------------------------
Cash at end of period $ 44,684 $ 50,886
================================
</TABLE>
3
<PAGE> 21
ANNEX B
<PAGE> 22
TCA CABLE TV. INC. AND SUBSIDIARIES
PRO FORMA BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
TCA FAYETTEVILLE
JANUARY 31, 1995 MARCH 31, 1995 ADJUSTMENTS PRO FORMA
<S> <C> <C> <C> <C>
ASSETS
Cash $2,447,776 $44,684 ($44,684)(a) $2,447,776
Accounts receivable, subscribers 5,324,633 450,893 5,775,526
Accounts receivable, other 145,222 0 145,222
Investments 2,087,693 0 2,087,693
Property, plant and equipment, at cost 282,340,065 10,769,976 (5,511,154)(a) 287,598,887
Less accumulated depreciation (167,563,804) (5,302,239) 5,302,239 (a) (167,563,804)
---------------------------------------------------- ------------------
Property, plant and equipment, net 114,776,261 5,467,737 (208,915) 120,035,083
---------------------------------------------------- ------------------
Other assets:
Intangibles, net of
accumulated amortization 161,875,391 61,292 33,739,886 (a) 195,676,569
Prepaid expenses 1,362,396 24,228 (24,228)(a) 1,362,396
---------------------------------------------------- ------------------
163,237,787 85,520 33,715,658 197,038,965
---------------------------------------------------- ------------------
Total Assets $288,019,372 $6,048,834 $33,462,059 $327,530,265
==================================================== ==================
LIABILITIES
Accounts payable $9,164,198 $96,253 ($96,253)(a) $9,164,198
Accrued expenses 9,512,729 733,084 (733,084)(a) 9,512,729
Subscriber advance payments 4,094,206 403,979 4,498,185
Income taxes payable 4,120,415 0 4,120,415
Deferred income taxes 41,450,000 0 41,450,000
Term debt 116,945,741 0 39,106,914 (a) 156,052,655
---------------------------------------------------- ------------------
Total Liabilities 185,287,289 1,233,316 38,277,577 224,798,182
---------------------------------------------------- ------------------
SHAREHOLDERS EQUITY
Common stock 2,474,026 0 2,474,026
Additional paid-in capital 43,007,469 0 43,007,469
Retained earnings 61,054,342 61,054,342
Net assets 4,815,518 (4,815,518)(a) 0
---------------------------------------------------- ------------------
106,535,837 4,815,518 (4,815,518) 106,535,837
Less treasury stock, at cost (3,803,754) 0 (3,803,754)
---------------------------------------------------- ------------------
Total Shareholders Equity 102,732,083 4,815,518 (4,815,518) 102,732,083
---------------------------------------------------- ------------------
$288,019,372 $6,048,834 $33,462,059 $327,530,265
==================================================== ==================
</TABLE>
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 23
TCA CABLE TV, INC. AND SUBSIDIARIES
PRO FORMA STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
TCA FAYETTEVILLE
YEAR ENDED YEAR ENDED
OCTOBER 31, 1994 DECEMBER 31, 1994 ADJUSTMENTS PRO FORMA
<S> <C> <C> <C> <C>
Revenues $162,300,265 $6,361,483 $168,661,748
Operating expenses:
Programming costs 36,476,851 1,432,390 37,909,241
Other operating expenses 46,235,512 2,057,639 48,293,151
Depreciation and amortization 33,635,939 936,159 259,459 (b) 34,831,557
---------------------------------------------------- ------------------
Total Operating Expenses 116,348,302 4,426,188 259,459 121,033,949
---------------------------------------------------- ------------------
Operating Income 45,951,963 1,935,295 (259,459) 47,627,799
Other income 1,662,688 8,594 1,671,282
Interest expense (9,747,932) (192,862) (2,634,568)(c) (12,575,362)
---------------------------------------------------- ------------------
Income before income taxes 37,866,719 1,751,027 (2,894,027) 36,723,719
Provision for (benefit from)
income taxes:
Current 11,805,000 (1,161,043)(d) 10,643,957
Deferred 3,087,114 711,501 (d) 3,798,615
---------------------------------------------------- ------------------
14,892,114 0 (449,542) 14,442,572
---------------------------------------------------- ------------------
Income from continuing operations $22,974,605 $1,751,027 ($2,444,485) $22,281,147
==========================================================================
Weighted average number of
common shares 24,638,135 24,638,135 24,638,135 24,638,135
Earnings per common share from
continuing operations $0.93 $0.07 ($0.10) $0.90
</TABLE>
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 24
TCA CABLE TV, INC. AND SUBSIDIARIES
PRO FORMA STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
TCA FAYETTEVILLE
THREE MONTHS THREE MONTHS
ENDED ENDED
JANUARY 31, 1995 MARCH 31, 1995 ADJUSTMENTS PRO FORMA
<S> <C> <C> <C> <C>
Revenues $43,304,289 $1,859,802 $45,164,091
Operating expenses:
Programming costs 9,879,460 412,965 10,292,425
Other operating expenses 11,614,317 538,879 12,153,196
Depreciation and amortization 6,326,594 238,283 60,621 (b) 6,625,498
----------------------------------------------------- ------------------
Total Operating Expenses 27,820,371 1,190,127 60,621 29,071,119
----------------------------------------------------- ------------------
Operating Income 15,483,918 669,675 (60,621) 16,092,972
Other income 72,804 18,788 91,592
Interest expense (2,469,558) (47,345) (746,525)(c) (3,263,428)
----------------------------------------------------- ------------------
Income before income taxes 13,087,164 641,118 (807,146) 12,921,136
Provision for (benefit from)
income taxes:
Current 3,900,000 (252,758)(d) 3,647,242
Deferred 1,450,000 184,885 (d) 1,634,885
----------------------------------------------------- ------------------
5,350,000 0 (67,873) 5,282,127
----------------------------------------------------- ------------------
Net income (loss) $7,737,164 $641,118 ($739,273) $7,639,009
===================================================== ==================
Weighted average number of
common shares 24,588,610 24,588,610 24,588,610 24,588,610
Earnings (loss) per common share $0.31 $0.03 ($0.03) $0.31
</TABLE>
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 25
TCA CABLE TV, INC. AND SUBSIDIARIES
NOTES TO PRO FORMA FINANCIAL STATEMENTS
(UNAUDITED)
1. Organization and Financial Statement Presentation
On May 9, 1995 TCA Cable TV, Inc. ("TCA" or the "Company") through its
subsidiaries acquired substantially all of the assets used by Time
Warner Entertainment Company, L.P. ("Time Warner") in the operation of
the cable television systems in and around the following cities of
Arkansas: Fayetteville, Elkins, Farmington, Greenland, and
unincorporated areas of Washington County ("Fayetteville"). The cost
of the acquisition was approximately $39 million, all of which was
paid in cash obtained from the Company's bank lines of credit.
The accompanying pro forma consolidated balance sheet as of January
31, 1995 has been prepared as if the acquisition had occurred as of
the balance sheet date. Accordingly, the pro forma balance sheet
presents the financial position of the Company, including the acquired
assets, as of January 31, 1995.
The accompanying pro forma consolidated statements of operations have
been prepared as if the Company had acquired the Fayetteville system
on November 1, 1993. Accordingly, the pro forma consolidated
statements of operations present the operating results of the Company
plus the operating results of the Fayetteville system for the year
ended October 31, 1994 and the three months ended January 31, 1995.
On May 1, 1995 TCA through its subsidiaries acquired substantially all
of the assets used by Time Warner in the operation of the cable
television systems in and around the following cities in Arkansas:
Russellville, Booneville, Paris, Clarksville, Johnson City,
Pottsville, Pope County and the unincorporated areas within Arkansas
counties in which the foregoing cities are located ("Russellville").
The Russellville acquisition is immaterial and is not included in the
pro forma financial statements.
2. Pro Forma Adjustments
Pro Forma Consolidated Balance Sheet
(a) The purchase price is allocated as follows:
<TABLE>
<S> <C>
Property, plant and equipment $ 5,258,822
Intangibles 33,801,178
Account receivables, subscribers 450,893
Subscriber advance payments (403,979)
--------------------------------------------
$ 39,106,914
</TABLE>
Pro Forma Consolidated Statement of Operations
(b) Additional depreciation and amortization expense has been recorded to
reflect an increase in the basis of assets acquired and the revision
of the Fayetteville system's depreciation and amortization policy to
conform to the Company's policy. Intangibles are amortized straight
line over 40 years.
(c) Additional interest expense has been recorded to reflect the term debt
incurred to finance the acquisition.
(d) The provision for income taxes has been adjusted to reflect the tax
provision as if the operations of the Fayetteville system had been
taxed at the Company's effective tax rate.
<PAGE> 26
INDEX TO EXHIBITS
Exhibit No. Description
2.1 Asset Purchase Agreement, dated January 20, 1995, between
Tele-Communications of Northwest Arkansas Limited
Partnership and Time Warner Entertainment Company, L.P.,
through its division Time Warner Cable Ventures.(2)
2.2 Letter Agreement, dated April 24, 1995, between
Tele-Communications of Northwest Arkansas Limited
Partnership and Time Warner Entertainment Company, L.P.,
through its division Time Warner Cable Ventures, amending
Asset Purchase Agreement.(3)
23.1 Consent of Ernst & Young LLP.(3)
__________________
(1) Previously filed as an exhibit to the Company's annual
report on Form 10-K for the year ended October 31, 1994
and incorporated herein by reference.
(2) Previously filed as an exhibit to the Company's Current
Report on Form 8-K filed May 24, 1995 and incorporated
herein by reference.
(3) Filed herewith.
6
<PAGE> 1
EXHIBIT 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in the registration statement of
TCA Cable TV, Inc. on Form S-8 (File Nos. 2-82934, 2-88892, 33-21901,
33-49172, 33-33898, 33-55895 and 33-61041) and Form S-3 (File Nos. 33-61616,
33-44289 and 33-40273) of our report dated August 11, 1995, with respect to the
financial statements of Warner Cable Communications - Fayetteville, Arkansas
Division, a division of Time Warner Entertainment Company, L.P., as of December
31, 1994, included in this Current Report on Form 8-K/A (Amendment No. 1).
ERNST & YOUNG LLP
Denver, Colorado
September 11, 1995
