UNITED STATES
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: March 31, 1998
PACIFIC BELL
A California Corporation
Commission File No. 1-1414
IRS Employer No. 94-0745535
140 New Montgomery Street, San Francisco, California 94105
Telephone Number (415) 542-9000
<PAGE>
Item 5. Other Events
On March 31, 1998, Pacific Bell, a wholly owned subsidiary of Pacific Telesis
Group (PTG), effected the distribution of Pacific Bell Directory, Pacific Bell
Mobile Services, Pacific Bell Internet Services and PB Comm Switches, Inc. to
PTG. Both Pacific Bell and PTG are wholly owned subsidiaries of SBC
Communications Inc. (SBC). This distribution has been accounted for by Pacific
Bell as a change in reporting entity, and will be reported by restating the
financial statements of prior periods in order to show financial information for
the new reporting entity for all periods. SBC will continue to provide financial
support to Pacific Bell to insure that the distribution will not adversely
affect Pacific Bell's creditworthiness.
Following is certain unaudited financial information for Pacific Bell, as
restated (dollars in millions):
<TABLE>
<CAPTION>
PACIFIC BELL AND SUBSIDIARIES
- -----------------------------------------------------------------------------------------
STATEMENTS OF INCOME
Dollars in millions
(Unaudited) Three Months Ended YTD
- ------------------------------------------------------------------------------------------
3/31/97 6/30/97 9/30/97 12/31/97 12/31/97
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operating Revenues
Local service $ 1,027 $ 1,066 $ 1,108 $ 1,131 $ 4,332
Network access 645 556 650 654 2,505
Long-distance service 305 293 299 279 1,176
Other 162 178 164 209 713
- -----------------------------------------------------------------------------------------
Total operating revenues 2,139 2,093 2,221 2,273 8,726
- -----------------------------------------------------------------------------------------
Operating Expenses
Cost of services and products 821 815 822 973 3,431
Selling, general and administrative 285 1,500 473 631 2,889
- -----------------------------------------------------------------------------------------
EBITDA* 1,033 (222) 926 669 2,406
- -----------------------------------------------------------------------------------------
Depreciation and amortization 469 567 441 446 1,923
- -----------------------------------------------------------------------------------------
Total operating expenses 1,575 2,882 1,736 2,050 8,243
- -----------------------------------------------------------------------------------------
Operating Income (Loss) 564 (789) 485 223 483
- -----------------------------------------------------------------------------------------
Interest expense (102) (124) (116) (118) (460)
- -----------------------------------------------------------------------------------------
Other income (expense) - net 4 (32) 12 27 11
- -----------------------------------------------------------------------------------------
Income (Loss) Before Income Taxes and
Cumulative Effect of Accounting Changes 466 (945) 381 132 34
- -----------------------------------------------------------------------------------------
Income Taxes 185 (340) 150 39 34
- -----------------------------------------------------------------------------------------
Income (Loss) Before Cumulative Effect of
Accounting Changes 281 (605) 231 93 -
- -----------------------------------------------------------------------------------------
Cumulative Effect of Accounting Changes,
net of tax 345 - - - 345
- -----------------------------------------------------------------------------------------
Net Income (Loss) $ 626 $ (605) $ 231 $ 93 $ 345
- -----------------------------------------------------------------------------------------
<FN>
*EBITDA=Earnings Before Interest, Taxes, Depreciation and Amortization
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PACIFIC BELL AND SUBSIDIARIES
- -----------------------------------------------------------------------------------------
STATEMENTS OF INCOME
Dollars in millions
(Unaudited) Three Months Ended YTD
- -----------------------------------------------------------------------------------------
3/31/96 6/30/96 9/30/96 12/31/96 12/31/96
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operating Revenues
Local service $ 967 $ 1,004 $ 1,016 $ 1,003 $ 3,920
Network access 622 631 625 647 2,525
Long-distance service 312 317 324 321 1,274
Other 137 152 158 211 658
- -----------------------------------------------------------------------------------------
Total operating revenues 2,038 2,104 2,123 2,182 8,447
- -----------------------------------------------------------------------------------------
Operating Expenses
Cost of services and products 757 711 779 791 3,038
Selling, general and administrative 357 418 408 479 1,662
- -----------------------------------------------------------------------------------------
EBITDA* 924 975 936 912 3,747
- -----------------------------------------------------------------------------------------
Depreciation and amortization 445 449 455 455 1,804
- -----------------------------------------------------------------------------------------
Total operating expenses 1,559 1,578 1,642 1,725 6,504
- -----------------------------------------------------------------------------------------
Operating Income 479 526 481 457 1,943
- -----------------------------------------------------------------------------------------
Interest expense (90) (97) (97) (95) (379)
- -----------------------------------------------------------------------------------------
Other income (expense) - net 3 (2) 2 1 4
- -----------------------------------------------------------------------------------------
Income Before Income Taxes 392 427 386 363 1,568
- -----------------------------------------------------------------------------------------
Income Taxes 158 175 156 130 619
- -----------------------------------------------------------------------------------------
Net Income $ 234 $ 252 $ 230 $ 233 $ 949
- -----------------------------------------------------------------------------------------
<FN>
*EBITDA=Earnings Before Interest, Taxes, Depreciation and Amortization.
</FN>
</TABLE>
<PAGE>
PACIFIC BELL AND SUBSIDIARIES
- --------------------------------------------------------------------------------
BALANCE SHEETS
Dollars in millions
- --------------------------------------------------------------------------------
(Unaudited) December 31,
- --------------------------------------------------------------------------------
1997 1996
Assets
Current Assets
Cash and cash equivalents $ 43 $ 57
Accounts receivable - net of allowances for
Uncollectibles 1,782 1,971
Prepaid expenses 53 34
Deferred income taxes 415 175
Other current assets 44 35
- --------------------------------------------------------------------------------
Total current assets 2,337 2,272
- --------------------------------------------------------------------------------
Property, Plant and Equipment - at cost 28,695 27,605
Less: Accumulated depreciation and amortization 17,442 16,602
- --------------------------------------------------------------------------------
Property, Plant and Equipment - Net 11,253 11,003
- --------------------------------------------------------------------------------
Other Assets 749 504
- --------------------------------------------------------------------------------
Total Assets $ 14,339 $ 13,779
- --------------------------------------------------------------------------------
Liabilities and Shareowner's Equity
Current Liabilities
Debt maturing within one year $ 546 $ 668
Accrued taxes 334 99
Accounts payable and accrued liabilities 2,719 2,303
- --------------------------------------------------------------------------------
Total current liabilities 3,599 3,070
- --------------------------------------------------------------------------------
Long-Term Debt 5,358 5,103
- --------------------------------------------------------------------------------
Deferred Credits and Other Noncurrent Liabilities
Deferred income taxes 957 541
Postemployment benefit obligation 881 644
Unamortized investment tax credits 188 235
Other noncurrent liabilities 569 1,100
- --------------------------------------------------------------------------------
Total deferred credits and other noncurrent liabilities 2,595 2,520
- --------------------------------------------------------------------------------
Shareowner's Equity
Common shares 225 225
Capital in excess of par value 4,814 5,458
Retained earnings (deficit) (2,252) (2,597)
- --------------------------------------------------------------------------------
Total shareowner's equity 2,787 3,086
- --------------------------------------------------------------------------------
Total Liabilities and Shareowner's Equity $ 14,339 $ 13,779
- --------------------------------------------------------------------------------
<PAGE>
PACIFIC BELL AND SUBSIDIARIES
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
Dollars in millions, increase (decrease) in cash and cash equivalents
(Unaudited)
- --------------------------------------------------------------------------------
1997 1996
- --------------------------------------------------------------------------------
Operating Activities
Net income $ 345 $ 949
Adjustments to reconcile net income to net cash
Provided by operating activities:
Depreciation and amortization 1,923 1,804
Provision for uncollectible accounts 184 130
Amortization of investment tax credits (48) (47)
Deferred income taxes 49 257
Cumulative effect of accounting change, net of tax (345) -
Changes in operating assets and liabilities:
Accounts receivable 5 (460)
Other current assets (28) 21
Accounts payable and accrued liabilities 651 (76)
Other - net (242) (401)
- --------------------------------------------------------------------------------
Total adjustments 2,149 1,228
- --------------------------------------------------------------------------------
Net Cash Provided by Operating Activities 2,494 2,177
- --------------------------------------------------------------------------------
Investing Activities
Construction and capital expenditures (2,045) (1,911)
Dispositions 65 -
Other (14) (22)
- --------------------------------------------------------------------------------
Net Cash Used in Investing Activities (1,994) (1,933)
- --------------------------------------------------------------------------------
Financing Activities
Net change in short-term borrowings with original
Maturities of three months or less (122) (280)
Issuance of other short-term borrowings 610 -
Repayment of other short-term borrowings (610) -
Issuance of long-term debt 252 495
Repayment of long-term debt - (4)
Equity received from parent 49 388
Dividends paid (693) (879)
Other - 33
- --------------------------------------------------------------------------------
Net Cash Used in Financing Activities (514) (247)
- --------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents (14) (3)
- --------------------------------------------------------------------------------
Cash and cash equivalents beginning of year 57 60
- --------------------------------------------------------------------------------
Cash and Cash Equivalents End of Period $ 43 $ 57
- --------------------------------------------------------------------------------
<PAGE>
Item 7. Financial Statements and Exhibits
Pacific Bell is filing herewith the following exhibits:
(c) Exhibits.
Exhibit
Number Description
27-a Financial Data Schedule, December 31, 1997
27-b Financial Data Schedule, September 30, 1997
27-c Financial Data Schedule, June 30, 1997
27-d Financial Data Schedule, March 31, 1997
27-e Financial Data Schedule, December 31, 1996
27-f Financial Data Schedule, September 30, 1996
27-g Financial Data Schedule, June 30, 1996
27-h Financial Data Schedule, March 31, 1996
27-i Financial Data Schedule, December 31, 1995
<PAGE>
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.
Pacific Bell
By: /s/ Robert B. Pickering
Robert B. Pickering
Vice President and
Chief Financial Officer
April 15, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' DECEMBER 31, 1997 CONSOLIDATED FINANCIAL STATEMENTS, AS
RESTATED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<CASH> 43
<SECURITIES> 0
<RECEIVABLES> 1,934
<ALLOWANCES> 152
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,337
<PP&E> 28,695
<DEPRECIATION> 17,442
<TOTAL-ASSETS> 14,339
<CURRENT-LIABILITIES> 3,599
<BONDS> 5,358
0
0
<COMMON> 225
<OTHER-SE> 2,562
<TOTAL-LIABILITY-AND-EQUITY> 14,339
<SALES> 0<F2>
<TOTAL-REVENUES> 8,726
<CGS> 0<F3>
<TOTAL-COSTS> 3,431
<OTHER-EXPENSES> 1,923
<LOSS-PROVISION> 184
<INTEREST-EXPENSE> 460
<INCOME-PRETAX> 34
<INCOME-TAX> 34
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 345
<NET-INCOME> 345
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' SEPTEMBER 30, 1997 CONSOLIDATED FINANCIAL STATEMENTS, AS
RESTATED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 55
<SECURITIES> 0
<RECEIVABLES> 2,037
<ALLOWANCES> 150
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,631
<PP&E> 28,383
<DEPRECIATION> 17,320
<TOTAL-ASSETS> 14,429
<CURRENT-LIABILITIES> 4,412
<BONDS> 5,105
0
0
<COMMON> 225
<OTHER-SE> 2,553
<TOTAL-LIABILITY-AND-EQUITY> 14,429
<SALES> 0<F2>
<TOTAL-REVENUES> 6,453
<CGS> 0<F3>
<TOTAL-COSTS> 2,458
<OTHER-EXPENSES> 1,477
<LOSS-PROVISION> 152
<INTEREST-EXPENSE> 342
<INCOME-PRETAX> (98)
<INCOME-TAX> (5)
<INCOME-CONTINUING> (93)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 345
<NET-INCOME> 252
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' JUNE 30, 1997 CONSOLIDATED FINANCIAL STATEMENTS, AS RESTATED,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 83
<SECURITIES> 0
<RECEIVABLES> 2,014
<ALLOWANCES> 163
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,659
<PP&E> 28,235
<DEPRECIATION> 17,223
<TOTAL-ASSETS> 14,298
<CURRENT-LIABILITIES> 4,256
<BONDS> 5,104
0
0
<COMMON> 225
<OTHER-SE> 2,551
<TOTAL-LIABILITY-AND-EQUITY> 14,298
<SALES> 0<F2>
<TOTAL-REVENUES> 4,232
<CGS> 0<F3>
<TOTAL-COSTS> 1,636
<OTHER-EXPENSES> 1,036
<LOSS-PROVISION> 111
<INTEREST-EXPENSE> 226
<INCOME-PRETAX> (479)
<INCOME-TAX> (155)
<INCOME-CONTINUING> (324)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 345
<NET-INCOME> 21
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' MARCH 31, 1997 CONSOLIDATED FINANCIAL STATEMENTS, AS RESTATED,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 90
<SECURITIES> 0
<RECEIVABLES> 1,991
<ALLOWANCES> 137
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,172
<PP&E> 27,990
<DEPRECIATION> 16,875
<TOTAL-ASSETS> 13,790
<CURRENT-LIABILITIES> 3,105
<BONDS> 5,104
0
0
<COMMON> 225
<OTHER-SE> 3,339
<TOTAL-LIABILITY-AND-EQUITY> 13,790
<SALES> 0<F2>
<TOTAL-REVENUES> 2,139
<CGS> 0<F3>
<TOTAL-COSTS> 821
<OTHER-EXPENSES> 469
<LOSS-PROVISION> 42
<INTEREST-EXPENSE> 102
<INCOME-PRETAX> 466
<INCOME-TAX> 185
<INCOME-CONTINUING> 281
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 345
<NET-INCOME> 626
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' DECEMBER 31, 1996 CONSOLIDATED FINANCIAL STATEMENTS, AS
RESTATED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 57
<SECURITIES> 0
<RECEIVABLES> 2,098
<ALLOWANCES> 127
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,272
<PP&E> 27,605
<DEPRECIATION> 16,602
<TOTAL-ASSETS> 13,779
<CURRENT-LIABILITIES> 3,070
<BONDS> 5,103
0
0
<COMMON> 225
<OTHER-SE> 2,861
<TOTAL-LIABILITY-AND-EQUITY> 13,779
<SALES> 0<F2>
<TOTAL-REVENUES> 8,447
<CGS> 0<F3>
<TOTAL-COSTS> 3,038
<OTHER-EXPENSES> 1,804
<LOSS-PROVISION> 130
<INTEREST-EXPENSE> 379
<INCOME-PRETAX> 1,568
<INCOME-TAX> 619
<INCOME-CONTINUING> 949
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 949
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' SEPTEMBER 30, 1996 CONSOLIDATED FINANCIAL STATEMENTS, AS
RESTATED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 76
<SECURITIES> 0
<RECEIVABLES> 2,027
<ALLOWANCES> 156
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,215
<PP&E> 27,219
<DEPRECIATION> 16,411
<TOTAL-ASSETS> 13,519
<CURRENT-LIABILITIES> 3,178
<BONDS> 5,102
0
0
<COMMON> 225
<OTHER-SE> 2,466
<TOTAL-LIABILITY-AND-EQUITY> 13,519
<SALES> 0<F2>
<TOTAL-REVENUES> 6,265
<CGS> 0<F3>
<TOTAL-COSTS> 2,247
<OTHER-EXPENSES> 1,349
<LOSS-PROVISION> 99
<INTEREST-EXPENSE> 284
<INCOME-PRETAX> 1,205
<INCOME-TAX> 489
<INCOME-CONTINUING> 716
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 716
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' JUNE 30, 1996 CONSOLIDATED FINANCIAL STATEMENTS, AS RESTATED,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 43
<SECURITIES> 0
<RECEIVABLES> 1,875
<ALLOWANCES> 142
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 2,067
<PP&E> 26,925
<DEPRECIATION> 16,129
<TOTAL-ASSETS> 13,383
<CURRENT-LIABILITIES> 3,159
<BONDS> 4,856
0
0
<COMMON> 225
<OTHER-SE> 2,493
<TOTAL-LIABILITY-AND-EQUITY> 13,383
<SALES> 0<F2>
<TOTAL-REVENUES> 4,142
<CGS> 0<F3>
<TOTAL-COSTS> 1,468
<OTHER-EXPENSES> 894
<LOSS-PROVISION> 62
<INTEREST-EXPENSE> 187
<INCOME-PRETAX> 819
<INCOME-TAX> 333
<INCOME-CONTINUING> 486
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 486
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' MARCH 31, 1996 CONSOLIDATED FINANCIAL STATEMENTS, AS RESTATED,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 51
<SECURITIES> 0
<RECEIVABLES> 1,668
<ALLOWANCES> 140
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 1,866
<PP&E> 26,629
<DEPRECIATION> 15,802
<TOTAL-ASSETS> 13,224
<CURRENT-LIABILITIES> 2,985
<BONDS> 4,856
0
0
<COMMON> 225
<OTHER-SE> 2,467
<TOTAL-LIABILITY-AND-EQUITY> 13,224
<SALES> 0<F2>
<TOTAL-REVENUES> 2,038
<CGS> 0<F3>
<TOTAL-COSTS> 757
<OTHER-EXPENSES> 445
<LOSS-PROVISION> 34
<INTEREST-EXPENSE> 90
<INCOME-PRETAX> 392
<INCOME-TAX> 158
<INCOME-CONTINUING> 234
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 234
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PACIFIC BELL
AND SUBSIDIARIES' DECEMBER 31, 1995 CONSOLIDATED FINANCIAL STATEMENTS, AS
RESTATED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 60
<SECURITIES> 0
<RECEIVABLES> 1,771
<ALLOWANCES> 131
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 1,982
<PP&E> 26,407
<DEPRECIATION> 15,534
<TOTAL-ASSETS> 13,041
<CURRENT-LIABILITIES> 3,427
<BONDS> 4,608
0
0
<COMMON> 225
<OTHER-SE> 2,403
<TOTAL-LIABILITY-AND-EQUITY> 13,041
<SALES> 0<F2>
<TOTAL-REVENUES> 7,904
<CGS> 0<F3>
<TOTAL-COSTS> 3,177
<OTHER-EXPENSES> 1,806
<LOSS-PROVISION> 120
<INTEREST-EXPENSE> 420
<INCOME-PRETAX> 1,161
<INCOME-TAX> 416
<INCOME-CONTINUING> 745
<DISCONTINUED> 0
<EXTRAORDINARY> (3,360)
<CHANGES> 0
<NET-INCOME> (2,615)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> THIS AMOUNT IS IMMATERIAL.
<F2> NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3> COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICES AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL-COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
