SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) Of The SECURITIES EXCHANGE
ACT OF 1934
Date of Report: April 21, 1995
Exact name of registrant
as specified in its charter: BELL ATLANTIC CORPORATION
Commission File No.: 1-8606
State of Incorporation: Delaware
IRS Employer Identification No.: 23-2259884
Address of principal
executive offices: 1717 Arch Street
Philadelphia, Pennsylvania
Zip Code 19103
Registrant's telephone number,
including area code: (215) 963-6000
Former name or former address,
if changed since last report: N/A
SIGNATURE
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.
BELL ATLANTIC CORPORATION
By: /s/ William O. Albertini
William O. Albertini
Vice President and Chief
Financial Officer
Date: April 21, 1995
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Item 5. Other Events.
Attached as an exhibit hereto is a copy of a press release issued by Bell
Atlantic Corporation (the Company) dated April 20, 1995
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(20) Press Release dated April 20, 1995
EXHIBIT INDEX
Exhibit No. Description Page No.
(20) Press Release dated
April 20, 1995
Contact: Cynthia M. Ciangio
(215) 963-6306
For Release: Immediately
April 20, 1995
BELL ATLANTIC ANNOUNCES 8.8 PERCENT INCREASE
IN FIRST QUARTER '95 EPS, ADJUSTED FOR SPECIAL CHARGES
Strong Gains from Operating Units
PHILADELPHIA, April 20, 1995 -- Bell Atlantic Corporation (NYSE: BEL)
today reported 1995 first-quarter earnings of $.95 per share, an increase
of 6.7 percent compared with $.89 per share for the first quarter of 1994.
Reported net income was $414.5 million, 6.5 percent higher than net
income of $389.2 million for the same period in 1994.
After adjusting for certain items, earnings per share in the first quarter
of 1995 were $.99, an increase of 8.8 percent, versus $.91 in the first
quarter of 1994; net income for the first quarter of 1995 was $434.1
million, an increase of 9.6 percent over $395.9 million in the first quarter
of 1994. The adjustments included a charge of $.04 per share in the first
quarter of 1995 for the impact of the devaluation of the peso on Bell
Atlantic's estimated share of the dollar-denominated debt of Grupo
Iusacell, Mexico's largest independent cellular provider, as well as an
extraordinary charge of $.02 per share for early extinguishment of debt in
the first quarter of 1994.
Bell Atlantic's strong earnings growth resulted from a solid increase in
operating income of 12.3 percent as well as cash flow (EBITDA) growth of
9.5 percent, excluding the impact of substantially discontinued non-
strategic businesses, compared with the first quarter of 1994.
"Our financial results for the first quarter of 1995 indicate that we are on
target to achieve our financial goals for the year," said Bell Atlantic
Chairman and Chief Executive Officer Raymond W. Smith. "In addition to
this strong performance, we accomplished a number of key initiatives this
quarter. For example, with NYNEX, we signed an agreement to invest in
CAI Wireless Systems, Inc., which holds exciting possibilities to speed
our early market entry into video programming distribution; and Howard
Stringer, former president of the CBS Broadcast Group, joined us as head
of our multi-media joint venture. Despite continuing difficult economic
conditions in Mexico, we remain confident in the long-term potential of
our investment in Grupo Iusacell."
Bell Atlantic's total operating revenues for the first quarter of 1995 were
$3.45 billion, compared with $3.42 billion for the first quarter of 1994.
Excluding the estimated positive impact of severe winter storms on
results for the first quarter of 1994 and adjusting for substantially
discontinued non-strategic businesses, revenues from continuing
operations grew by 4.8 percent. This revenue growth includes the impact
of certain federal and state regulatory rate reductions recognized in the
first quarter of 1995. Access line growth of 2.9 percent included Centrex
growth of 8.3 percent and very rapid growth in market acceptance of ISDN
with more than 100,000 lines in service at the end of the quarter. Growth
in reported minutes of use remains solid at 6.8 percent compared with the
first quarter of 1994, which included storm-related calling volumes.
Bell Atlantic's total operating expenses for the first quarter of 1995 were
$2.62 billion, a decrease of 2 percent compared with $2.67 billion in 1994.
Adjusted for the expense effect of substantially discontinued businesses
and the estimated costs associated with the effects of unusually severe
weather during the first quarter of last year, operating expenses in the
first quarter of 1995 increased approximately 2.2 percent. These results
primarily were driven by reductions in employee costs and other on-going
cost reduction programs. The company continues to pursue aggressively a
number of cost-reduction initiatives.
Cellular results reflected continued robust subscriber growth with
152,600 subscribers added in the first quarter of 1995, compared with
109,400 added in the same quarter of 1994, and an annualized growth rate
of 56.2 percent. The company's continuing high subscriber growth rate and
increased penetration of the lower-usage consumer market were the
primary contributors to an 11 percent decline in average monthly revenue
per subscriber. Revenue growth, adjusted for the
May 1, 1994, restructuring of the NYSMSA partnership with NYNEX, was
35.3 percent for the quarter.
"In addition to the strong performance registered by Bell Atlantic Mobile
this quarter," said Smith, "we also are pleased with our PCS PrimeCo
partnership's success in winning licenses for 11 major markets in the
FCC's broadband PCS spectrum auctions. Together with our partners, we
have added more than 57 million POPs to the partners' combined existing
base of nearly 110 million cellular POPs, providing further evidence of our
commitment to be a market leader in the national wireless arena."
Bell Atlantic Corporation is at the forefront of the new communications,
entertainment, and information industry. The Philadelphia-based company
provides a full array of local telecommunications services throughout the
mid-Atlantic region and is one of the nation's largest cellular carriers.
Bell Atlantic is a partner in national alliances that will offer wireless
communications, as well as video and interactive programming. Bell
Atlantic also has substantial holdings and operations in international
markets and provides services for customer-based information
technology.
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<PAGE>
BELL ATLANTIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Income (unaudited)
(In millions, except per-share amounts)
Three months ended
March 31
1995* 1994
Operating Revenues
Transport Services
Local service $1,081.3 $1,062.3
Network acces 820.9 803.9
Toll service 367.0 411.3
Ancillary Services
Directory advertising 275.7 267.6
Other 125.4 94.0
Value-Added Services 326.7 308.0
Wireless Services 291.5 236.7
Other Services 161.1 235.8
Total Operating Revenues 3,449.7 3,419.6
Operating Expenses
Employee costs, including benefits
and taxes 1,034.2 1,047.9
Depreciation and amortization 667.7 648.6
Other 916.3 974.3
Total Operating Expenses 2,618.2 2,670.8
Operating Income 831.5 748.8
Equity in income (loss) of affiliates (6.7) 21.9
Other income (expense), net 1.1 (8.1)
Interest expense 138.9 143.5
Income before provision for income
taxes and extraordinary item 687.0 619.1
Provision for income taxes 272.5 223.2
Income before extraordinary item 414.5 395.9
Extraordinary item:
Early extinguishment of debt,
net of tax -- (6.7)
Net Income $ 414.5 389.2
*Effective 8/1/94, the company's telephone subsidiaries discontinued
application of Statement of Financial Accounting Standards No. 71,
"Accounting for the Effects of Certain Types of Regulation."
<PAGE>
BELL ATLANTIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Income (unaudited) - continued
(In millions, except per-share amounts)
Three months ended
March 31
1995* 1994
Per Common Share Amounts
Income before extraordinary item $.95 $.91
Extraordinary item -- (.02)
Net Income $.95 $.89
Dividends declared per
common share $.70 $.69
Weighted average number of
common and equivalent
shares outstanding 437.4 437.3
Other Selected Data
March 31
1995 1994
Return on Average Common Equity
Three months ended 26.6% 18.5%
Total Assets (millions) $24,312.2 $29,452.6
Total Employees 72,000 73,700
*Effective August 1, 1994, the company's telephone subsidiaries
discontinued application of Statement of Financial Accounting Standards
No. 71, "Accounting for the Effects of Certain Types of Regulation."
<PAGE>
BELL ATLANTIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (unaudited)
(In millions)
Three Months Ended March 31,
1995 1994
Cash Flows from Operating Activities
Net income $ 414.5 $389.2
Depreciation and amortization 667.7 648.6
Extraordinary item -- 6.7
Other, net (45.1) (380.7)
Net Cash Provided by Operating
Activities 1,037.1 663.8
Net Cash Used in Investing
Activities (952.1) (361.2)
Net Cash Used in Financing
Activities (169.3) (193.3)
Increase (Decrease) in Cash and
Cash Equivalents (84.3) 109.3
Cash and Cash Equivalents,
Beginning of Period 142.9 146.1
Cash and Cash Equivalents,
End of Period $ 58.6 $ 255.4
<PAGE>
BELL ATLANTIC CELLULAR OPERATIONS
Selected Operating Statistics and Financial Data (unaudited)
(In thousands, except percentages and data per subscriber)
Three months ended March 31
Normalized
1995 1994 % Change % Change
Selected Operating Data
Owned Pops(1) 35,590 34,841 2
Controlled MSA Pops(1) 32,779 32,519 1
Controlled RSA Pops(1) 4,192 3,652 15
Controlled
Penetration(1)(2) 4.95% 3.18% 56
Controlled Subscribers(3 1,828.7 1,148.5 59 56
Subscribers(4) 1,631.9 1,063.5 53
Churn 1.59% 1.43% 11
Rev. per Subscriber
per Month(5) $ 62 $ 71 (13) (11)
Acquisition Cost
per Gross Add(6) $218 $ 236 (7) ( 9)
Selected Financial Data
Revenue(7) $287,234 $233,242 23 35
Operating Income(8) $ 34,132 $ 20,545 66 15
Operating
Cash Flow(9)(10) $ 72,853 $ 51,685 41 20
Operating
Cash Flow Margin(11) 32.42% 27.45% 18 ( 9)
<PAGE>
Explanation of Normalization Adjustments:
On May 1, 1994, the NYSMSA Partnership ("the Partnership")
between Bell Atlantic Mobile and NYNEX Mobile was restructured to
include both companies' reseller operations. Prior to restructuring, the
Partnership provided wholesale services only, and both companies
separately provided reseller services throughout the Partnership's
operating territory. 1994 data and statistics, in the above table, include
Bell Atlantic's Northern New Jersey reseller operations. Normalized 1994
data and statistics, indicated in the "Normalized Percent Change" column
in the above table and described in the footnotes below, exclude Bell
Atlantic Mobile's Northern New Jersey reseller operations. Bell Atlantic
owns a 36 percent interest in the Partnership and reports results "below
the line" as equity income in unconsolidated subsidiaries.
Footnotes:
(1) 1995 and 1994 Controlled MSA POPs include approximately five
million Northern New Jersey POPs managed by Bell Atlantic Mobile
pursuant to the restructured NYSMSA partnership as described above.
(2) Controlled penetration is calculated using controlled subscribers
(including those managed by Bell Atlantic pursuant to the
restructured NYSMSA partnership) divided by total controlled POPs.
(3) Controlled Subscribers for 1995 and 1994, included in the above
table, include all Northern New Jersey subscribers that are managed
by Bell Atlantic, but are part of the NYSMSA partnership as
described above. Excluding customers previously managed by NYNEX,
the normalized 1995 subscribers and growth rate would have been
1,793.7 and 56 percent, respectively.
(4) Subscribers for 1995 and 1994 exclude all Northern New Jersey
subscribers that are managed by Bell Atlantic, but are part of the
NYSMSA partnership as described above. Penetration excluding the
Northern New Jersey POPs and subscribers is 5.12 percent and 3.42
percent for 1995 and 1994, respectively.
(5) 1994 normalized revenue per subscriber is $70.
(6)Acquisition costs include commission expense and net margin on
sale of customer equipment. 1994 normalized acquisition cost per
gross add is $240.
(7) Revenue includes service revenues, incollect, outcollect, and
equipment revenue, but excludes paging revenue. 1994 normalized
revenue is $212,254.
(8) 1994 normalized Operating Income is $29,574.
(9) Operating Cash Flow equals Operating Income plus depreciation and
amortization.
(10) 1994 normalized Operating Cash Flow is $60,572.
(11) Operating Cash Flow Margin uses revenues which consist primarily
of service revenues, outcollect revenue, and net margin on customer
equipment sales. 1994 normalized Operating Cash Flow Margin is
35.47 percent.
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