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Previous: LTX CORP, 10-Q, 1995-03-17 |
Next: ENERGYNORTH INC, S-3D, 1995-03-17 |
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: January 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
Commission File 0-11478
TCA CABLE TV, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Texas 75-1798185
- ------------------------------- ------------------------------------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
3015 S. E. Loop 323, Tyler, Texas 75701
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: 903/595-3701
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
-------- --------
The number of shares outstanding of each of the registrant's classes of
common stock as of March 15, 1995 was:
24,537,035 shares of common stock
1
<PAGE> 2
TCA CABLE TV, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I - FINANCIAL INFORMATION
Consolidated Balance Sheets - January 31, 1995 and October 31, 1994 3
Consolidated Statements of Operations -
Three months ended January 31, 1995 and 1994 4
Consolidated Statement of Shareholders' Equity -
Three months ended January 31, 1995 5
Consolidated Statements of Cash Flows -
Three months ended January 31, 1995 and 1994 6-7
Notes to Consolidated Financial Statements 8
Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II - OTHER INFORMATION 9
SIGNATURES 10
</TABLE>
2
<PAGE> 3
TCA CABLE TV, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
January 31, October 31
ASSETS 1995 1994
-------------- ------------
(Unaudited)
<S> <C> <C>
Cash $ 2,447,776 2,445,112
-------------- ------------
Accounts receivable, subscribers 5,324,633 4,913,712
-------------- ------------
Accounts receivable, other 145,222 164,904
-------------- ------------
Investments 2,087,693 2,223,038
-------------- ------------
Property, plant and equipment, at cost:
Land 2,661,555 2,661,055
Distribution systems 249,601,066 243,607,084
Transportation equipment 6,669,382 6,513,387
Other 23,408,062 22,553,063
-------------- ------------
282,340,065 275,334,589
Less accumulated depreciation (167,563,804) (162,749,992)
-------------- ------------
114,776,261 112,584,597
-------------- ------------
Other assets:
Intangibles, net of accumulated
amortization of $66,645,281 and
$65,132,499, respectively 161,875,391 163,386,733
Prepaid expenses 1,362,396 494,839
-------------- ------------
163,237,787 163,881,572
-------------- ------------
$ 288,019,372 $286,212,935
============== ============
</TABLE>
<TABLE>
<CAPTION>
January 31, October 31,
LIABILITIES 1995 1994
------------ ------------
(Unaudited)
<S> <C> <C>
Accounts payable $ 9,164,198 5,357,363
Accrued expenses 9,512,729 11,276,727
Subscriber advance payments 4,094,206 3,739,313
Income taxes payable 4,120,415 495,278
Deferred income taxes 41,450,000 40,000,000
Term debt 116,945,741 126,447,345
------------ ------------
185,287,289 187,316,026
------------ ------------
Contingencies and commitments
SHAREHOLDERS' EQUITY
Preferred stock, $1.00 par value,
5,000,000 shares authorized; none
issued
Common stock, $.10 par value, 60,000,000
shares authorized; 24,740,259 and
24,733,261 shares issued, respectively 2,474,026 2,473,326
Additional paid-in capital 43,007,469 42,860,849
Retained earnings 61,054,342 56,266,488
------------ ------------
106,535,837 101,600,663
Less treasury stock at cost,
209,828 and 159,828 shares, respectively (3,803,754) (2,703,754)
------------ ------------
102,732,083 98,896,909
------------ ------------
$288,019,372 $286,212,935
============ ============
</TABLE>
The accompanying notes are an integral part
of the consolidated financial statements.
<PAGE> 4
TCA CABLE TV, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
January 31,
-----------------------------
1995 1994
-----------------------------
<S> <C> <C>
CATV revenues $43,304,289 $39,278,593
----------- -----------
Operating expenses:
Salaries, wages and benefits 7,555,713 6,908,333
Programming costs 9,879,460 8,871,453
Other operating expenses 1,483,699 1,286,183
Selling, general and administrative 2,574,905 2,664,784
Depreciation and amortization 6,326,594 8,352,263
----------- -----------
27,820,371 28,083,016
----------- -----------
Operating income 15,483,918 11,195,577
Other income 72,804 658,233
Interest expense (2,469,558) (2,489,326)
----------- -----------
Income before income taxes 13,087,164 9,364,484
----------- -----------
Provision for income taxes:
Current 3,900,000 2,800,000
Deferred 1,450,000 800,000
----------- -----------
5,350,000 3,600,000
----------- -----------
Income before cumulative effect of change
in accounting principle 7,737,164 5,764,484
Cumulative effect of change in accounting principle (1,900,000)
----------- -----------
Net income $ 7,737,164 $ 3,864,484
=========== ===========
Earnings per common share before cumulative
effect of change in accounting principle $ 0.31 $ 0.23
Cumulative effect of change in accounting principle (0.07)
----------- -----------
Earnings per common share $ 0.31 $ 0.16
=========== ===========
</TABLE>
The accompanying notes are an integral part
of the consolidated financial statements.
4
<PAGE> 5
TCA CABLE TV, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
Common Stock Issued Additional
---------------------------- Paid-In Retained Treasury
Shares Amount Capital Earnings Stock
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Balance, October 31, 1994 24,733,261 $ 2,473,326 $42,860,849 $ 56,266,488 $(2,703,754)
Net income for the three months
ended January 31, 1995 7,737,164
Issuance of common stock 6,128 613 134,057
Stock options exercised 870 87 12,563
Treasury stock purchased (1,100,000)
Cash dividends at $.12 a share (2,949,310)
------------ ------------ ------------ ------------- ------------
Balance, January 31, 1995 24,740,259 $ 2,474,026 $43,007,469 $ 61,054,342 $(3,803,754)
============ ============ ============ ============= ============
</TABLE>
The accompanying notes are an integral
part of the consolidated financial statements.
<PAGE> 6
TCA CABLE TV, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
January 31,
------------------------------
1995 1994
-------------- ------------
<S> <C> <C>
Cash flows from operating activities:
Cash received from customers $ 43,267,943 $ 40,662,428
Cash paid to suppliers and employees (21,348,382) (18,553,204)
Other revenue received 208,539 98,868
Interest paid (2,405,002) (2,617,142)
Income taxes paid (274,863) (271,018)
-------------- ------------
Net cash provided by operating activities 19,448,235 19,319,932
-------------- ------------
Cash flows from investing activities:
Capital expenditures (7,007,307) (5,498,485)
Proceeds from sales of assets 769,200
-------------- ------------
Net cash used in investing activities (7,007,307) (4,729,285)
-------------- ------------
Cash flows from financing activities:
Borrowings of term debt 8,100,000 9,599,990
Repayments of term debt (17,601,605) (20,401,453)
Proceeds from stock options exercised 12,651 12,029
Dividends paid (2,949,310) (2,712,959)
-------------- ------------
Net cash provided by (used in) financing activities (12,438,264) (13,502,393)
-------------- ------------
Net increase (decrease) in cash 2,664 1,088,254
Cash at beginning of period 2,445,112 1,450,276
-------------- ------------
Cash at end of period $ 2,447,776 $ 2,538,530
=============== =============
</TABLE>
The accompanying notes are an integral
part of the consolidated financial statements.
6
<PAGE> 7
TCA CABLE TV, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS, Continued
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
January 31,
------------------------------
1995 1994
-------------- -------------
<S> <C> <C>
Reconciliation of net income to net cash
provided by operating activities:
Net income $ 7,737,164 $ 3,864,484
Adjustments to reconcile net income
to net cash provided by operating
activities:
Cumulative effect of change in accounting principle 1,900,000
Depreciation expense 4,813,812 5,454,437
Amortization expense 1,512,782 2,897,826
(Gain) loss on sale of assets (559,365)
Share of (earnings) losses of affiliates 135,735 (559,365)
Deferred income taxes 1,450,000 800,000
Contribution of common stock to retirement plan 134,671 133,798
(Increase) decrease in other assets (867,557) (726,567)
(Increase) decrease in accounts receivable, subscribers (410,921) 244,893
(Increase) decrease in accounts receivable, other 19,682 313,686
Increase (decrease) in subscriber advance payments 354,893 825,256
Increase (decrease) in accrued expenses (1,763,998) (457,530)
Increase (decrease) in income taxes payable 3,625,137 2,528,982
Increase (decrease) in accounts payable 3,806,835
Accrued treasury stock purchase (1,100,000) 2,100,032
--------------- --------------
Net cash provided by operating activities $ 19,448,235 $ 18,760,567
=============== ==============
</TABLE>
The accompanying notes are an integral
part of the consolidated financial statements.
7
<PAGE> 8
TCA CABLE TV, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
A. Pursuant to the rules and regulations of the Securities and Exchange
Commission, certain financial information has been condensed and
certain footnote disclosures have been omitted. Such information
and disclosures are normally included in financial statements
prepared in accordance with generally accepted accounting
principles.
These condensed financial statements should be read in conjunction
with the financial statements and notes thereto in the Company's
latest report on Form 10-K.
The financial statements as of January 31, 1995 and for the three
month period then ended are unaudited; however, in the opinion of
management, such statements include all adjustments (consisting
solely of normal and recurring adjustments) necessary to present
fairly the financial information included therein.
B. The consolidated statements of operations for the three months ended
January 31, 1995, are not necessarily indicative of the operating
results to be expected for the full year.
C. Earnings per common share are computed based upon the weighted
average common shares outstanding during the period, including
common stock equivalents, of 24,588,610 shares and 24,695,803
shares for 1995 and 1994, respectively.
D. Effective November 1, 1993, the Company adopted the provisions of
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes" ("SFAS 109"). SFAS 109 requires recognition of
deferred tax liabilities and assets for the expected future tax
consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax
liabilities and assets are determined based on the difference
between the financial statement and tax bases of assets and
liabilities using enacted tax rates in effect for the year in
which the differences are expected to reverse. As of November 1,
1993, the Company recorded a one-time tax charge of $1,900,000 or
$.07 per share, which amount represents the net increase to the
deferred tax liability as of that date. Such amount has bee
reflected in the consolidated statements of operations as the
cumulative effect of a change in accounting principle.
8
<PAGE> 9
TCA CABLE TV, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS - Comparison of the three-month period ended January 31,
1995, with the same three-month period of the prior year reveals increases in
revenues, operating income and net income. Revenues, operating income, and net
income increased by approximately 10%, 38% and 100%, respectively. Income
before cumulative effect of change in accounting principle increased 34%.
The revenue increase was mostly attributable to internal growth. The Company's
basic accounts increased from 457,061 at January 31, 1994 to 468,662 at January
31, 1995 or approximately 3%. Average revenue per account increased from
$28.72 to $30.93 or approximately 8%.
Operating expenses decreased approximately 1% during the first quarter of
fiscal 1995 as compared to the first quarter of fiscal 1994. Salaries, wages
and benefits increased 9%. Programming costs and other operating expenses
increased 11% and 15%, respectively. Selling, general and administrative
expenses decreased 3%. Depreciation and amortization decreased 24%.
Interest expense decreased by $19,768 or approximately 1%. The Company's term
debt was $116.9 million at January 31, 1995 compared to $132.4 million at
January 31, 1994, a net decrease of $15.5 million. The Company's weighted
average interest rate was 8.03% and 7.23% for the quarters ended January 31,
1995 and 1994, respectively.
LIQUIDITY AND CAPITAL RESOURCES - The Company's capital expenditures have been
primarily for cable system construction, upgrading and rebuilding, acquisition
of other cable systems and purchases of converters to be furnished to
subscribers.
Expenditures for rebuilding, upgrading and maintaining the Company's cable
systems and for converter purchases have been financed principally with cash
flow from operations. Acquisitions of cable systems have generally been
financed with cash flow from operations and through bank borrowings.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit A - None
(b) No reports on Form 8-K have been filed during the quarter for
which this report is filed.
(c) Exhibit 27 - Financial Data Schedule
9
<PAGE> 10
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 thereto duly authorized.
TCA CABLE TV, INC.
Date: March 16, 1995 /s/ Robert M. Rogers
----------------------------------
Robert M. Rogers, Chairman and
Chief Executive Officer
Date: March 16, 1995 /s/ Jimmie F. Taylor
----------------------------------
Jimmie F. Taylor, Vice President,
CFO and Treasurer
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-START> NOV-01-1993
<PERIOD-END> OCT-31-1994
<CASH> 2,445,112
<SECURITIES> 0
<RECEIVABLES> 4,913,712
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 275,334,589
<DEPRECIATION> 162,749,992
<TOTAL-ASSETS> 286,212,935
<CURRENT-LIABILITIES> 0
<BONDS> 126,447,345
<COMMON> 2,473,326
0
0
<OTHER-SE> 92,127,337
<TOTAL-LIABILITY-AND-EQUITY> 286,212,935
<SALES> 0
<TOTAL-REVENUES> 162,300,265
<CGS> 0
<TOTAL-COSTS> 36,476,851
<OTHER-EXPENSES> 62,977,499
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9,747,932
<INCOME-PRETAX> 37,866,719
<INCOME-TAX> 14,892,114
<INCOME-CONTINUING> 22,974,605
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> (1,900,000)
<NET-INCOME> 21,074,605
<EPS-PRIMARY> .86
<EPS-DILUTED> .86
</TABLE>
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