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: January 24, 1994
BELLSOUTH CORPORATION
(Exact name of registrant as specified in its charter)
Georgia 1-8607 58-1533433
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
1155 Peachtree Street, N. E., Atlanta, Georgia 30367-6000
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (404) 249-2000
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Item 5. Other Events
BellSouth Corporation reported a loss for the fourth
quarter of 56 cents. Adjusted for previously announced
restructuring and other charges that totaled $1.56 per share,
fourth quarter earnings would have been $1.00 per share.
The fourth quarter included one-time charges of $1.40 per
share for restructuring, 9 cents per share related to the initial
impact of the settlement of a rate proceeding in Florida, and 5
cents per share for debt refinancings, resulting in a reported net
loss of $276.0 million, or 56 cents per share. This compared with
reported net income of $353.4 million, or 72 cents per share, in
the same period of 1992. The new higher corporate income tax rate
decreased quarterly earnings by 2 cents per share in 1993.
For the year 1993, BellSouth reported earnings per share of
$1.77 compared with $3.30 in 1992. Excluding the effects of all
one-time and unusual items in both years, earnings per share of
$3.72 in 1993 increased 13 percent compared with earnings per share
$3.29 in 1992.
Revenues reached $4.12 billion in the fourth quarter of
1993, up 5.5 percent compared with the same quarter a year earlier.
Quarterly operating expenses increased just 0.6 percent, excluding
the restructuring and Florida settlement charges in 1993, and
expenses related to Hurricane Andrew in 1992.
The company reported an access line increase of 179,200
in the final three months of 1993, 38 percent higher than the
increase of 130,100 in the fourth quarter of 1992. For 1993 as a
whole, the number of BellSouth access lines serving customers
increased 684,600, surpassed only by the company's record increase
of 693,500 in 1987. BellSouth served 19,362,000 access lines at
the close of 1993.
U.S. cellular customers increased to 1,559,100 at year end,
up 39 percent from December 31, 1992. In BellSouth's eight
overseas cellular markets, customers increased during the year by
more than 114,000 or 148 percent, to 192,200. In Latin America, 96
percent customer growth helped the company's cellular operations
contribute positively to earnings in 1993.
For the year, BellSouth's reported net income, including
restructuring and one-time charges, was $880.1 million, compared
with $1.62 billion in 1992. Revenues of $15.9 billion in
1993 exceeded the previous year by $678 million, or 4.5 percent.
Annual operating expenses increased 3.2 percent, excluding the
impacts of the restructuring, Florida settlement and Hurricane
Andrew.
First quarter 1993 earnings will be restated to reflect an
accounting change related to the retroactive adoption of Statement
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of Financial Accounting Standards No. 112, "Employers' Accounting
for Postemployment Benefits." This new accounting standard covers
the accounting for certain benefits such as workers' compensation
and disability payments.
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BELLSOUTH CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In Millions, Except Per Share Amounts)
For the Three Months For the Twelve Months
Ended December 31, Ended December 31,
1993 1992 1993 1992
(Unaudited) (Unaudited) (Unaudited)
Operating Revenues:
Network and Related
Services
Local service $1,664.4 $1,586.3 $6,577.3 $6,236.0
Interstate access 763.5 741.0 2,991.2 2,945.6
Intrastate access 226.1 215.4 881.9 871.8
Toll 308.7 301.1 1,219.5 1,248.8
Directory advertising
and publishing 426.5 467.8 1,515.4 1,459.8
Wireless communications 424.3 334.0 1,553.4 1,195.6
Other services 311.3 264.5 1,141.6 1,244.0
Total Operating
Revenues 4,124.8 3,910.1 15,880.3 15,201.6
Operating Expenses:
Cost of services
and products 1,461.6 1,515.6 5,865.1 5,681.3
Depreciation 822.0 787.0 3,103.8 3,032.2
Selling, general
and administrative 987.3 903.6 3,487.9 3,327.4
Restructuring charge 1,136.4 - 1,136.4 -
Total Operating
Expenses 4,407.3 3,206.2 13,593.2 12,040.9
Operating Income (Loss) (282.5) 703.9 2,287.1 3,160.7
Interest Expense 168.4 175.3 689.0 746.4
Other Income
(Expense), net (26.0) 23.0 7.6 177.6
Income (Loss) Before Income
Taxes, Extraordinary Loss
and Cumulative Effect of
Change in Method of
Accounting (476.9) 551.6 1,605.7 2,591.9
Provision for Income Taxes (224.3) 198.2 571.6 933.5
Income (Loss) Before
Extraordinary Loss and
Cumulative Effect of Change
in Method of Accounting (252.6) 353.4 1,034.1 1,658.4
Extraordinary Loss on Early
Extinguishment of
Debt, net of tax (23.4) - (86.6) (40.7)
Cumulative Effect of Change
in Method of Accounting,
net of tax (A) - - (67.4) -
Net Income (Loss) $ (276.0) $ 353.4 $ 880.1 $1,617.7
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Weighted Average Common
Shares Outstanding 496.5 493.7 496.1 490.8
Dividends Declared
Per Common Share $ .69 $ .69 $ 2.76 $ 2.76
Earnings Per Share:
Income (Loss) Before
Extraordinary Loss and
Cumulative Effect of
Change in Method of
Accounting, net of tax $ (.51) $ .72 $ 2.08 $ 3.38
Extraordinary Loss on
Early Extinguishment
of Debt, net of tax (.05) - (.17) (.08)
Cumulative Effect of
Change in Method of
Accounting, net of tax (A) - - (.14) -
Net Income (Loss) $ (.56) $ .72 $ 1.77 $ 3.30
(A) In the fourth quarter of 1993, BellSouth adopted Statement of Financial
Accounting Standards No. 112, "Employers' Accounting for Postemployment
Benefits." Because the change in accounting is retroactive to January 1, 1993,
results for the first quarter of 1993 have been restated to reflect the one-time
charge of $67.4 ($.14 per share) for adoption of the accounting standard.
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BELLSOUTH CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Millions)
December 31, December 31,
1993 1992
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 501.5 $ 265.5
Temporary cash investments 49.0 80.6
Accounts receivable, net of allowance
for uncollectibles of $149.6 and $123.0 2,985.2 2,692.5
Material and supplies 418.7 430.6
Other current assets 364.6 201.8
4,319.0 3,671.0
Investments and Advances 2,039.4 1,087.1
Property, Plant and Equipment:
Telephone plant and other equipment 41,974.8 39,800.9
Less: Accumulated Depreciation 17,307.0 15,528.3
24,667.8 24,272.6
Deferred Charges and Other Assets 512.2 630.2
Intangible Assets 1,334.9 1,801.8
Total Assets $32,873.3 $31,462.7
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Debt maturing within one year $ 1,838.6 $ 1,634.6
Accounts payable 979.0 1,077.2
Other current liabilities 2,943.8 2,310.4
5,761.4 5,022.2
Long-Term Debt:
Debentures 4,200.7 6,263.0
Other long-term debt 3,180.0 1,096.7
7,380.7 7,359.7
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes 3,465.3 3,715.8
Unamortized investment tax credits 515.9 604.3
Other liabilities and deferred credits 2,255.8 962.1
6,237.0 5,282.2
Shareholders' Equity:
Common stock, $1 par value 501.6 493.8
Paid-in capital 8,009.4 7,609.6
Retained earnings 5,919.3 6,395.4
Shares held in trust (292.6) -
Guarantee of ESOP debt (643.5) (700.2)
13,494.2 13,798.6
Total Liabilities & Shareholders' Equity $32,873.3 $31,462.7
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PRELIMINARY (UNAUDITED)
January 24, 1994
BELLSOUTH FINANCIAL HIGHLIGHTS
SELECTED DATA
Three Months Ended Three Months Ended
December 31, 1993 December 31, 1992
Return to equity (7.9%) 10.3%
Return to average total capital (2.3%) 8.8%
Weighted average common shares
and equivalent shares
outstanding (millions) 496.5 493.7
Earnings per share $ (.56) $ .72
Dividend per share $ .69 $ .69
Property Additions (millions) $ 1,019.5 $ 1,145.7
At December 31,
1993 1992
Common shares outstanding (millions) 496.1 493.8
Debt ratio 40.2% 39.0%
Total Employees 95,084 97,112
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PRELIMINARY (UNAUDITED)
January 24, 1994
BELLSOUTH FINANCIAL HIGHLIGHTS
SELECTED DATA
Twelve Months Ended Twelve Months Ended
December 31, 1993 December 31, 1992
Return to equity 6.3% 11.9%
Return to average total capital 6.1% 9.8%
Weighted average common shares
and equivalent shares
outstanding (millions) 496.1 490.8
Earnings per share $ 1.77 $ 3.30
Dividend per share $ 2.76 $ 2.76
Property Additions (millions) $ 3,630.8 $ 3,265.6
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BELLSOUTH TELECOMMUNICATIONS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In Millions)
For the Three Months For the Twelve Months
Ended December 31, Ended December 31,
1993 1992 1993 1992
(Unaudited) (Unaudited) (Unaudited)
Operating Revenues:
Network and Related
Services
Local service $1,664.4 $1,586.3 $6,577.3 $6,236.0
Interstate access 763.5 741.0 2,991.2 2,945.6
Intrastate access 226.1 215.4 881.9 871.8
Toll 308.7 301.1 1,219.5 1,248.8
Other 511.4 448.3 1,909.7 1,879.9
Total Operating
Revenues 3,474.1 3,292.1 13,579.6 13,182.1
Operating Expenses:
Cost of services
and products 1,260.0 1,310.7 5,169.4 5,050.6
Depreciation 763.9 743.6 2,900.0 2,859.9
Selling, general
and administrative 665.3 628.7 2,384.7 2,348.0
Restructuring charge 1,136.4 - 1,136.4 -
Total Operating
Expenses 3,825.6 2,683.0 11,590.5 10,258.5
Operating Income (Loss) (351.5) 609.1 1,989.1 2,923.6
Interest Expense 137.6 139.0 562.6 583.3
Other Income, net 8.1 4.8 21.4 75.5
Income (Loss) Before
Income Taxes, Extraordinary
Loss and Cumulative Effect
of Change in Method of
Accounting (481.0) 474.9 1,447.9 2,415.8
Provision for Income Taxes (228.2) 149.4 461.5 800.8
Income (Loss) Before
Extraordinary Loss and
Cumulative Effect of Change
in Method of Accounting (252.8) 325.5 986.4 1,615.0
Extraordinary Loss on Early
Extinguishment of Debt,
net of tax (23.4) - (86.6) (40.7)
Cumulative Effect of Change
in Method of Accounting,
net of tax (A) - - (64.8)
Net Income (Loss) $ (276.2) $ 325.5 $ 835.0 $1,574.3
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Retained Earnings:
At begining of period $3,910.3 $3,988.9 $3,967.0 $3,983.5
Net Income (Loss) (276.2) 325.5 835.0 1,574.3
Dividends declared (454.1) (347.4) (1,612.3) (1,587.8)
Other adjustments - - (9.7) (3.0)
At end of period $3,180.0 $3,967.0 $3,180.0 $3,967.0
(A) In the fourth quarter of 1993, BellSouth Telecommunications adopted
Statement of Financial Accounting Standards No. 112, "Employers' Accounting for
Postemployment Benefits." Because the change in accounting is retroactive to
January 1, 1993, results for the first quarter of 1993 have been restated to
reflect the one-time charge of $64.8 for adoption of the accounting standard.
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PRELIMINARY (UNAUDITED)
January 24, 1994
BELLSOUTH TELECOMMUNICATIONS FINANCIAL HIGHLIGHTS
SELECTED DATA
Three Months Ended Three Months Ended
December 31, 1993 December 31, 1992
Property Additions (millions) $ 865.7 $ 991.6
Interest Charged Construction $ 5.0 $ 4.5
(millions)
Access Minutes of Use (millions):
Interstate 13,591.8 12,842.7
Intrastate 3,979.1 3,577.2
IntraLATA toll messages (millions) 302.5 303.3
At December 31,
1993 1992
Debt ratio 41.3% 38.5%
Telephone Employees 81,415 82,866
Network access lines in service
(thousands) 19,362 18,677
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PRELIMINARY (UNAUDITED)
January 24, 1994
BELLSOUTH TELECOMMUNICATIONS FINANCIAL HIGHLIGHTS
SELECTED DATA
Twelve Months Ended Twelve Months Ended
December 31, 1993 December 31, 1992
Property Additions (millions) $ 3,113.6 $ 2,927.0
Interest Charged Construction $ 23.7 $ 15.3
(millions)
Access Minutes of Use (millions):
Interstate 53,345.0 50,546.4
Intrastate 15,260.9 13,994.2
IntraLATA toll messages (millions) 1,251.0 1,280.3
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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 thereunto duly authorized.
BELLSOUTH CORPORATION
By: /s/Ronald M. Dykes
Ronald M. Dykes
Vice President and Comptroller
January 24, 1994
