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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Ohio
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31-1056105
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(State of Incorporation)
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(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Shares (par value $0.01 per share)
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New York Stock Exchange
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6
3
/
4
% Convertible Preferred Shares
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New York Stock Exchange
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Large accelerated filer
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x
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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o
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Form 10-K Part I
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Cincinnati Bell Inc.
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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Form 10-K Part I
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Cincinnati Bell Inc.
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2015
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2014
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2013
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|||
Fioptics revenue (in millions):
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$190.8
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$142.4
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$100.8
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|||
Fioptics subscribers (in thousands):
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High-speed internet
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153.7
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113.7
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79.9
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Video
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114.4
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91.4
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74.2
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Voice
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77.4
|
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61.0
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|
53.3
|
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•
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connected approximately 7,500 commercial buildings with fiber-based services (also referred to as a lit building), including more than 630 multi-tenant units ("MTU's") lit with fiber;
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Form 10-K Part I
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Cincinnati Bell Inc.
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•
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provided cell site back-haul services to more than 70% of the 1,100 cell sites in-market, of which approximately 500 are lit with fiber.
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Form 10-K Part I
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Cincinnati Bell Inc.
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IT Services and Hardware
|
|
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Strategic
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Integration
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Professional Services
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Consulting
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Installation
|
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Staff Augmentation
|
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Unified Communications
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Voice Monitoring
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Maintenance
|
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Managed IP Telephony Solutions
|
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Cloud Services
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Virtual Data Centers
|
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Storage
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Backup
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Monitoring and Management
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Network Monitoring/Management
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Security
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Telecom & IT Hardware
|
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Hardware
|
|
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Software Licenses
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Form 10-K Part I
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Cincinnati Bell Inc.
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Form 10-K Part I
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|
Cincinnati Bell Inc.
|
Form 10-K Part I
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Cincinnati Bell Inc.
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Form 10-K Part I
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|
Cincinnati Bell Inc.
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Percentage of revenue
|
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2015
|
|
2014
|
|
2013
|
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2015 vs 2014 Change
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|
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2014 vs 2013 Change
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|
|||||
Strategic
|
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46
|
%
|
|
38
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%
|
|
35
|
%
|
|
8
|
|
pts
|
|
3
|
|
pts
|
Legacy
|
|
31
|
%
|
|
35
|
%
|
|
43
|
%
|
|
(4
|
)
|
|
|
(8
|
)
|
|
Integration
|
|
23
|
%
|
|
27
|
%
|
|
22
|
%
|
|
(4
|
)
|
|
|
5
|
|
|
Total
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
Percentage of revenue
|
|
2015
|
|
2014
|
|
2013
|
|
2015 vs 2014 Change
|
|
|
2014 vs 2013 Change
|
|
|||||
Consumer
|
|
29
|
%
|
|
27
|
%
|
|
28
|
%
|
|
2
|
|
pts
|
|
(1
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)
|
pt
|
Business
|
|
61
|
%
|
|
62
|
%
|
|
60
|
%
|
|
(1
|
)
|
|
|
2
|
|
|
Carrier
|
|
10
|
%
|
|
11
|
%
|
|
12
|
%
|
|
(1
|
)
|
|
|
(1
|
)
|
|
Total
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
•
|
|
our costs could significantly exceed expectations;
|
•
|
|
the acceleration may not generate the expected increase in subscribers;
|
•
|
|
it may be inefficient to build out the additional fiber at an accelerated rate;
|
•
|
|
there may be a lack of workforce to achieve our construction, sales and installation targets; and
|
•
|
|
access to the fiber required for our construction plans may be limited.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
•
|
|
the Company is required to use a substantial portion of its cash flow from operations to pay principal and interest on its debt, thereby reducing the availability of cash flow to fund working capital, capital expenditures, strategic acquisitions, investments and alliances, and other general corporate requirements;
|
•
|
|
there is a variable interest rate on a portion of its debt which could increase if the market interest rates increase;
|
•
|
|
the Company’s debt increases its vulnerability to adverse changes in the credit markets, which adverse changes could increase the Company's borrowing costs and limit the availability of financing;
|
•
|
|
the Company’s debt service obligations limit its flexibility to plan for, or react to, changes in its business and the industries in which it operates;
|
•
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|
the Company’s level of debt and shareowners’ deficit may restrict it from raising additional financing on satisfactory terms to fund working capital, capital expenditures, strategic acquisitions, investments and alliances, and other general corporate requirements; and
|
•
|
|
the Company’s debt instruments require the Company to comply with specified financial ratios and other restrictive covenants. Failure to comply with these covenants, if not cured or waived, could limit availability to the cash required to fund the Company's operations and general obligations and could result in the Company’s dissolution, bankruptcy, liquidation or reorganization.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
•
|
|
incur additional indebtedness;
|
•
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create liens;
|
•
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make investments;
|
•
|
|
enter into transactions with affiliates;
|
•
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sell assets;
|
•
|
|
guarantee indebtedness;
|
•
|
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declare or pay dividends or other distributions to shareholders;
|
•
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repurchase equity interests;
|
•
|
|
redeem debt that is junior in right of payment to such indebtedness;
|
•
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|
enter into agreements that restrict dividends or other payments from subsidiaries;
|
•
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|
issue or sell capital stock of certain of its subsidiaries; and
|
•
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|
consolidate, merge, or transfer all or substantially all of its assets and the assets of its subsidiaries on a consolidated basis.
|
•
|
|
limit the Company’s ability to plan for or react to market conditions or meet capital needs or otherwise restrict the Company’s activities or business plans; and
|
•
|
|
adversely affect the Company’s ability to finance its operations, strategic acquisitions, investments or alliances, or other capital needs, or to engage in other business activities that would be in its interest.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
First
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Second
|
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Third
|
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Fourth
|
||||||||
|
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Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
||||||||
2015
|
High
|
$
|
3.68
|
|
|
$
|
4.09
|
|
|
$
|
3.97
|
|
|
$
|
3.97
|
|
|
Low
|
$
|
2.93
|
|
|
$
|
3.34
|
|
|
$
|
3.08
|
|
|
$
|
3.14
|
|
2014
|
High
|
$
|
3.75
|
|
|
$
|
3.95
|
|
|
$
|
4.10
|
|
|
$
|
3.71
|
|
|
Low
|
$
|
3.25
|
|
|
$
|
3.19
|
|
|
$
|
3.35
|
|
|
$
|
2.97
|
|
Plan Category
|
Number of securities to be issued upon exercise of outstanding stock options, awards, warrants and rights
|
|
Weighted-average exercise price of outstanding stock options, awards, warrants and rights
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
||||
|
(a)
|
|
(b)
|
|
(c)
|
||||
Equity compensation plans approved by security holders
|
7,720,718
|
|
(1)
|
$
|
3.62
|
|
|
5,647,918
|
|
Equity compensation plans not approved by security holders
|
166,721
|
|
(2)
|
—
|
|
|
136,196
|
|
|
Total
|
7,887,439
|
|
|
$
|
3.62
|
|
|
5,784,114
|
|
(1)
|
Includes 3,879,678 outstanding stock options and stock appreciation rights not yet exercised, 234,308 shares of time-based restricted stock, and 3,606,732 shares of performance-based awards, restrictions on which have not expired as of
December 31, 2015
. Awards were granted under various incentive plans approved by Cincinnati Bell Inc. shareholders. The number of performance-based awards assumes the maximum awards that can be earned if the performance conditions are achieved.
|
(2)
|
The shares to be issued relate to deferred compensation in the form of previously received special awards and annual awards to non-employee directors pursuant to the “Deferred Compensation Plan for Outside Directors.” From 1997 through 2011, the directors received an annual award of phantom stock equivalent to a number of common shares. In 2015 and 2014, no such awards were granted. As a result of a plan amendment effective as of January 1, 2005, upon termination of Board service, non-employee directors are required to take distribution of all annual phantom stock awards in cash. Therefore, the number of actual shares of common stock to be issued pursuant to the plan as of
December 31, 2015
is approximately 11,500. This plan also provides that no awards are payable until such non-
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Dec-10
|
Dec-11
|
Dec-12
|
Dec-13
|
Dec-14
|
Dec-15
|
Cincinnati Bell Inc.
|
$100
|
$108
|
$196
|
$127
|
$114
|
$129
|
S&P 500
|
$100
|
$102
|
$118
|
$157
|
$178
|
$181
|
S&P Integrated Telecommunication Services
|
$100
|
$108
|
$124
|
$138
|
$141
|
$145
|
Period
|
|
Total Number of Shares (or Units) Purchased
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs *
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Plans or Programs (in millions)*
|
||||||
October 1, 2015 - December 31, 2015
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
129.2
|
|
*
|
In February 2010, the Board of Directors approved an additional plan for the repurchase of the Company’s outstanding common stock in an amount up to $150.0 million. The Company may repurchase shares when management believes the share price offers an attractive value and to the extent its available cash is not needed for growth opportunities. This repurchase plan does not have a stated maturity.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions, except per share amounts)
|
|
2015
|
|
2014
|
|
2013 (a)
|
|
2012 (a)
|
|
2011 (a)
|
||||||||||
Operating Data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
$
|
1,167.8
|
|
|
$
|
1,161.5
|
|
|
$
|
1,073.4
|
|
|
$
|
1,251.5
|
|
|
$
|
1,204.4
|
|
Cost of services and products, selling, general and administrative, depreciation, and amortization expense
|
|
1,031.3
|
|
|
979.5
|
|
|
877.6
|
|
|
1,018.0
|
|
|
944.1
|
|
|||||
Other operating costs and losses (b)
|
|
8.5
|
|
|
5.1
|
|
|
56.0
|
|
|
20.3
|
|
|
11.6
|
|
|||||
Operating income
|
|
128.0
|
|
|
176.9
|
|
|
139.8
|
|
|
213.2
|
|
|
248.7
|
|
|||||
Interest expense
|
|
103.1
|
|
|
145.9
|
|
|
176.0
|
|
|
211.2
|
|
|
205.4
|
|
|||||
Loss on extinguishment of debt
|
|
20.9
|
|
|
19.6
|
|
|
29.6
|
|
|
13.6
|
|
|
—
|
|
|||||
Loss from CyrusOne investment (c)
|
|
5.1
|
|
|
7.0
|
|
|
10.7
|
|
|
—
|
|
|
—
|
|
|||||
Gain on sale of CyrusOne investment (d)
|
|
(449.2
|
)
|
|
(192.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
|
290.8
|
|
|
117.7
|
|
|
(64.9
|
)
|
|
(18.8
|
)
|
|
17.9
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
|
62.9
|
|
|
(42.1
|
)
|
|
10.2
|
|
|
30.0
|
|
|
0.7
|
|
|||||
Net income (loss)
|
|
$
|
353.7
|
|
|
$
|
75.6
|
|
|
$
|
(54.7
|
)
|
|
$
|
11.2
|
|
|
$
|
18.6
|
|
Basic earnings (loss) per common share from continuing operations
|
|
$
|
1.34
|
|
|
$
|
0.51
|
|
|
$
|
(0.37
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
0.04
|
|
Basic earnings (loss) per common share from discontinued operations
|
|
$
|
0.30
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.05
|
|
|
$
|
0.15
|
|
|
$
|
—
|
|
Basic earnings (loss) per common share
|
|
$
|
1.64
|
|
|
$
|
0.31
|
|
|
$
|
(0.32
|
)
|
|
$
|
—
|
|
|
$
|
0.04
|
|
Diluted earnings (loss) per common share from continuing operations
|
|
$
|
1.33
|
|
|
$
|
0.51
|
|
|
$
|
(0.37
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
0.04
|
|
Diluted earnings (loss) per common share from discontinued operations
|
|
$
|
0.30
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.05
|
|
|
$
|
0.15
|
|
|
$
|
—
|
|
Diluted earnings (loss) per common share
|
|
$
|
1.63
|
|
|
$
|
0.31
|
|
|
$
|
(0.32
|
)
|
|
$
|
—
|
|
|
$
|
0.04
|
|
Dividends declared per common share
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Weighted-average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
209.6
|
|
|
208.5
|
|
|
205.9
|
|
|
197.0
|
|
|
196.8
|
|
|||||
Diluted
|
|
210.2
|
|
|
209.6
|
|
|
205.9
|
|
|
197.0
|
|
|
200.0
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial Position
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Property, plant and equipment, net
|
|
$
|
975.5
|
|
|
$
|
815.4
|
|
|
$
|
756.8
|
|
|
$
|
1,415.4
|
|
|
$
|
1,211.2
|
|
Total assets (e)
|
|
1,454.4
|
|
|
1,820.7
|
|
|
2,108.4
|
|
|
2,873.8
|
|
|
2,716.1
|
|
|||||
Total long-term obligations (f)
|
|
1,493.4
|
|
|
2,058.4
|
|
|
2,529.7
|
|
|
3,215.2
|
|
|
3,073.5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flow provided by operating activities
|
|
$
|
110.9
|
|
|
$
|
175.2
|
|
|
$
|
78.8
|
|
|
$
|
212.7
|
|
|
$
|
289.9
|
|
Cash flow provided by (used in) investing activities (g)
|
|
383.2
|
|
|
392.6
|
|
|
(185.4
|
)
|
|
(371.8
|
)
|
|
(244.7
|
)
|
|||||
Cash flow (used in) provided by financing activities (h)
|
|
(544.6
|
)
|
|
(514.5
|
)
|
|
87.6
|
|
|
109.0
|
|
|
(48.8
|
)
|
|||||
Capital expenditures (i)
|
|
(283.6
|
)
|
|
(182.3
|
)
|
|
(196.9
|
)
|
|
(367.2
|
)
|
|
(255.5
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(a)
|
Results for 2012 and 2011 include the revenues and expenses of CyrusOne Inc. ("CyrusOne"), our former data center business. During 2013, CyrusOne results are included for the period January 1, 2013 through January 23, 2013. Effective January 24, 2013, the date of the CyrusOne IPO, we no longer include CyrusOne's operating results in our consolidated financial statements. See Notes 1 and 4 to the consolidated financial statements.
|
|
|
(b)
|
Other operating costs and losses consist of restructuring charges (reversals), transaction-related compensation, curtailment loss (gain), loss(gain) on disposal of assets - net, impairment of assets and transaction costs.
|
|
|
(c)
|
Losses represent our equity method share of CyrusOne's losses. Effective December 31, 2015, our ownership in CyrusOne is now accounted for using the cost method.
|
|
|
(d)
|
In 2015, we recorded a gain resulting from the sale of 20.3 million partnership units of CyrusOne LP to CyrusOne, Inc. and the sale of 1.4 million shares of CyrusOne's common stock. In 2014, we recorded a gain resulting from the sale of 16.0 million partnership units of CyrusOne LP to CyrusOne, Inc.
|
|
|
(e)
|
Total assets include current and noncurrent assets from discontinued operations.
|
|
|
(f)
|
Total long-term obligations comprise long-term debt less current portion, pension and postretirement benefit obligations, other noncurrent liabilities and noncurrent liabilities from discontinued operations. See Notes 3, 8, 9, and 12 to the consolidated financial statements for discussions related to 2015 and 2014.
|
|
|
(g)
|
In 2015, cash from investing activities included $643.9 million of proceeds from the sale of 20.3 million partnership units of CyrusOne LP to CyrusOne Inc. and the sale of 1.4 million shares of CyrusOne's common stock. In 2014, cash from investing activities included $355.9 million of proceeds from the sale of 16.0 million partnership units of CyrusOne LP to CyrusOne Inc. and $194.4 million of proceeds from the sale of wireless spectrum licenses.
|
|
|
(h)
|
Cash used in financing activities for 2015 includes the repayment of $300.0 million 8
3/4%
Senior Subordinated Notes due 2018, $182.7 million of 8
3/8
% Senior Notes due 2020, $13.7 million of 7
1/4
% Notes due 2023 and $5.8 million of CBT Notes. Cash used in financing activities for 2014 includes the repayment of $325.0 million 8
3/4%
Senior Subordinated Notes due 2018 and repayment of $22.7 million 8
3/8
% Senior Notes due 2020.
|
|
|
(i)
|
Capital expenditures include capital expenditures from discontinued operations.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Service revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Entertainment and Communications
|
$
|
735.0
|
|
|
$
|
728.8
|
|
|
$
|
6.2
|
|
|
1
|
%
|
|
$
|
718.0
|
|
|
$
|
10.8
|
|
|
2
|
%
|
|
IT Services and Hardware
|
198.0
|
|
|
161.4
|
|
|
36.6
|
|
|
23
|
%
|
|
138.7
|
|
|
22.7
|
|
|
16
|
%
|
|
|||||
Data Center Colocation
|
—
|
|
|
—
|
|
|
—
|
|
|
n/m
|
|
|
15.2
|
|
|
(15.2
|
)
|
|
n/m
|
|
|
|||||
Total service revenue
|
$
|
933.0
|
|
|
$
|
890.2
|
|
|
$
|
42.8
|
|
|
5
|
%
|
|
$
|
871.9
|
|
|
$
|
18.3
|
|
|
2
|
%
|
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Product revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Entertainment and Communications
|
$
|
7.4
|
|
|
$
|
10.7
|
|
|
$
|
(3.3
|
)
|
|
(31
|
)%
|
|
$
|
5.7
|
|
|
$
|
5.0
|
|
|
88
|
%
|
|
IT Services and Hardware
|
227.4
|
|
|
260.6
|
|
|
(33.2
|
)
|
|
(13
|
)%
|
|
195.8
|
|
|
64.8
|
|
|
33
|
%
|
|
|||||
Total product revenue
|
$
|
234.8
|
|
|
$
|
271.3
|
|
|
$
|
(36.5
|
)
|
|
(13
|
)%
|
|
$
|
201.5
|
|
|
$
|
69.8
|
|
|
35
|
%
|
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Cost of services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Entertainment and Communications
|
$
|
319.9
|
|
|
$
|
290.2
|
|
|
$
|
29.7
|
|
|
10
|
%
|
|
$
|
273.2
|
|
|
$
|
17.0
|
|
|
6
|
%
|
|
IT Services and Hardware
|
152.6
|
|
|
126.0
|
|
|
26.6
|
|
|
21
|
%
|
|
108.4
|
|
|
17.6
|
|
|
16
|
%
|
|
|||||
Data Center Colocation
|
—
|
|
|
—
|
|
|
—
|
|
|
n/m
|
|
|
4.6
|
|
|
(4.6
|
)
|
|
n/m
|
|
|
|||||
Total cost of services
|
$
|
472.5
|
|
|
$
|
416.2
|
|
|
$
|
56.3
|
|
|
14
|
%
|
|
$
|
386.2
|
|
|
$
|
30.0
|
|
|
8
|
%
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Cost of products
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Entertainment and Communications
|
$
|
6.3
|
|
|
$
|
8.3
|
|
|
$
|
(2.0
|
)
|
|
(24
|
)%
|
|
$
|
4.5
|
|
|
$
|
3.8
|
|
|
84
|
%
|
|
IT Services and Hardware
|
191.8
|
|
|
223.2
|
|
|
(31.4
|
)
|
|
(14
|
)%
|
|
170.6
|
|
|
52.6
|
|
|
31
|
%
|
|
|||||
Total cost of products
|
$
|
198.1
|
|
|
$
|
231.5
|
|
|
$
|
(33.4
|
)
|
|
(14
|
)%
|
|
$
|
175.1
|
|
|
$
|
56.4
|
|
|
32
|
%
|
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Selling, general, and administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Entertainment and Communications
|
$
|
146.2
|
|
|
$
|
133.0
|
|
|
$
|
13.2
|
|
|
10
|
%
|
|
$
|
131.7
|
|
|
$
|
1.3
|
|
|
1
|
%
|
|
IT Services and Hardware
|
53.5
|
|
|
51.0
|
|
|
2.5
|
|
|
5
|
%
|
|
44.1
|
|
|
6.9
|
|
|
16
|
%
|
|
|||||
Data Center Colocation
|
—
|
|
|
—
|
|
|
—
|
|
|
0
|
%
|
|
2.4
|
|
|
(2.4
|
)
|
|
n/m
|
|
|
|||||
Corporate
|
19.4
|
|
|
20.2
|
|
|
(0.8
|
)
|
|
(4
|
)%
|
|
9.7
|
|
|
10.5
|
|
|
n/m
|
|
|
|||||
Total selling, general and administrative
|
$
|
219.1
|
|
|
$
|
204.2
|
|
|
$
|
14.9
|
|
|
7
|
%
|
|
$
|
187.9
|
|
|
$
|
16.3
|
|
|
9
|
%
|
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Depreciation and amortization expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Entertainment and Communications
|
$
|
129.2
|
|
|
$
|
115.7
|
|
|
$
|
13.5
|
|
|
12
|
%
|
|
$
|
112.2
|
|
|
$
|
3.5
|
|
|
3
|
%
|
|
IT Services and Hardware
|
12.3
|
|
|
11.7
|
|
|
0.6
|
|
|
5
|
%
|
|
10.5
|
|
|
1.2
|
|
|
11
|
%
|
|
|||||
Data Center Colocation
|
—
|
|
|
—
|
|
|
—
|
|
|
0
|
%
|
|
5.2
|
|
|
(5.2
|
)
|
|
n/m
|
|
|
|||||
Corporate
|
0.1
|
|
|
0.2
|
|
|
(0.1
|
)
|
|
(50
|
)%
|
|
0.5
|
|
|
(0.3
|
)
|
|
(60
|
)%
|
|
|||||
Total depreciation and amortization expense
|
$
|
141.6
|
|
|
$
|
127.6
|
|
|
$
|
14.0
|
|
|
11
|
%
|
|
$
|
128.4
|
|
|
$
|
(0.8
|
)
|
|
(1
|
)%
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Other operating costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring charges (reversals)
|
$
|
6.0
|
|
|
$
|
(0.4
|
)
|
|
$
|
6.4
|
|
|
n/m
|
|
|
$
|
13.5
|
|
|
$
|
(13.9
|
)
|
|
n/m
|
|
|
Transaction-related compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
n/m
|
|
|
42.6
|
|
|
(42.6
|
)
|
|
n/m
|
|
|
|||||
Curtailment loss (gain)
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
n/m
|
|
|
(0.6
|
)
|
|
0.6
|
|
|
n/m
|
|
|
|||||
Loss (gain) on sale of disposal of assets, net
|
0.8
|
|
|
(0.3
|
)
|
|
1.1
|
|
|
n/m
|
|
|
(1.1
|
)
|
|
0.8
|
|
|
(73
|
)%
|
|
|||||
Impairment of assets
|
—
|
|
|
4.6
|
|
|
(4.6
|
)
|
|
n/m
|
|
|
—
|
|
|
4.6
|
|
|
n/m
|
|
|
|||||
Transaction costs
|
1.4
|
|
|
1.2
|
|
|
0.2
|
|
|
17
|
%
|
|
1.6
|
|
|
(0.4
|
)
|
|
(25
|
)%
|
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Non-operating costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense
|
$
|
103.1
|
|
|
$
|
145.9
|
|
|
$
|
(42.8
|
)
|
|
(29
|
)%
|
|
$
|
176.0
|
|
|
$
|
(30.1
|
)
|
|
(17
|
)%
|
|
Loss on extinguishment of debt
|
20.9
|
|
|
19.6
|
|
|
1.3
|
|
|
7
|
%
|
|
29.6
|
|
|
(10.0
|
)
|
|
(34
|
)%
|
|
|||||
Loss from CyrusOne investment
|
5.1
|
|
|
7.0
|
|
|
(1.9
|
)
|
|
(27
|
)%
|
|
10.7
|
|
|
(3.7
|
)
|
|
(35
|
)%
|
|
|||||
Gain on Sale of CyrusOne investment
|
(449.2
|
)
|
|
(192.8
|
)
|
|
(256.4
|
)
|
|
n/m
|
|
|
—
|
|
|
(192.8
|
)
|
|
n/m
|
|
|
|||||
Other income, net
|
(2.5
|
)
|
|
(1.9
|
)
|
|
(0.6
|
)
|
|
32
|
%
|
|
(3.3
|
)
|
|
1.4
|
|
|
(42
|
)%
|
|
|||||
Income tax expense (benefit)
|
159.8
|
|
|
81.4
|
|
|
78.4
|
|
|
96
|
%
|
|
(8.3
|
)
|
|
89.7
|
|
|
n/m
|
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
62.9
|
|
|
(42.1
|
)
|
|
105.0
|
|
|
n/m
|
|
|
10.2
|
|
|
(52.3
|
)
|
|
n/m
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Revenue
|
$
|
743.7
|
|
|
$
|
740.7
|
|
|
$
|
3.0
|
|
|
0
|
%
|
|
$
|
724.8
|
|
|
$
|
15.9
|
|
|
2
|
%
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of services and products
|
331.5
|
|
|
306.2
|
|
|
25.3
|
|
|
8
|
%
|
|
286.3
|
|
|
19.9
|
|
|
7
|
%
|
|
|||||
Selling, general and administrative
|
150.9
|
|
|
136.2
|
|
|
14.7
|
|
|
11
|
%
|
|
132.7
|
|
|
3.5
|
|
|
3
|
%
|
|
|||||
Depreciation and amortization
|
129.2
|
|
|
115.7
|
|
|
13.5
|
|
|
12
|
%
|
|
112.2
|
|
|
3.5
|
|
|
3
|
%
|
|
|||||
Restructuring charges (reversals)
|
1.6
|
|
|
(0.5
|
)
|
|
2.1
|
|
|
n/m
|
|
|
9.1
|
|
|
(9.6
|
)
|
|
n/m
|
|
|
|||||
Curtailment loss (gain)
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
n/m
|
|
|
(0.6
|
)
|
|
0.6
|
|
|
n/m
|
|
|
|||||
Loss (gain) on sale or disposal of assets
|
0.3
|
|
|
(0.4
|
)
|
|
0.7
|
|
|
n/m
|
|
|
(1.1
|
)
|
|
0.7
|
|
|
64
|
%
|
|
|||||
Impairments of assets
|
—
|
|
|
4.6
|
|
|
(4.6
|
)
|
|
n/m
|
|
|
—
|
|
|
4.6
|
|
|
n/m
|
|
|
|||||
Total operating costs and expenses
|
613.8
|
|
|
561.8
|
|
|
52.0
|
|
|
9
|
%
|
|
538.6
|
|
|
23.2
|
|
|
4
|
%
|
|
|||||
Operating income
|
$
|
129.9
|
|
|
$
|
178.9
|
|
|
$
|
(49.0
|
)
|
|
(27
|
)%
|
|
$
|
186.2
|
|
|
$
|
(7.3
|
)
|
|
(4
|
)%
|
|
Operating margin
|
17.5
|
%
|
|
24.2
|
%
|
|
|
|
(6.7)
|
|
|
25.7
|
%
|
|
|
|
(1.5)
|
|
|
|||||||
Capital expenditures
|
$
|
269.5
|
|
|
$
|
163.7
|
|
|
$
|
105.8
|
|
|
65
|
%
|
|
$
|
162.6
|
|
|
$
|
1.1
|
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Metrics (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fioptics units passed
|
432.0
|
|
|
335.0
|
|
|
97.0
|
|
|
29
|
%
|
|
276.0
|
|
|
59.0
|
|
|
21
|
%
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Internet subscribers:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
DSL
|
133.7
|
|
|
156.2
|
|
|
(22.5
|
)
|
|
(14
|
)%
|
|
188.5
|
|
|
(32.3
|
)
|
|
(17
|
)%
|
|
|||||
Fioptics
|
153.7
|
|
|
113.7
|
|
|
40.0
|
|
|
35
|
%
|
|
79.9
|
|
|
33.8
|
|
|
42
|
%
|
|
|||||
Total internet subscribers
|
287.4
|
|
|
269.9
|
|
|
17.5
|
|
|
6
|
%
|
|
268.4
|
|
|
1.5
|
|
|
1
|
%
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fioptics video subscribers
|
114.4
|
|
|
91.4
|
|
|
23.0
|
|
|
25
|
%
|
|
74.2
|
|
|
17.2
|
|
|
23
|
%
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential voice lines:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Legacy
|
146.4
|
|
|
181.6
|
|
|
(35.2
|
)
|
|
(19
|
)%
|
|
223.5
|
|
|
(41.9
|
)
|
|
(19
|
)%
|
|
|||||
Fioptics
|
71.4
|
|
|
56.7
|
|
|
14.7
|
|
|
26
|
%
|
|
47.9
|
|
|
8.8
|
|
|
18
|
%
|
|
|||||
Total residential voice lines
|
217.8
|
|
|
238.3
|
|
|
(20.5
|
)
|
|
(9
|
)%
|
|
271.4
|
|
|
(33.1
|
)
|
|
(12
|
)%
|
|
|||||
Business voice lines:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Legacy
|
215.4
|
|
|
238.0
|
|
|
(22.6
|
)
|
|
(9
|
)%
|
|
253.9
|
|
|
(15.9
|
)
|
|
(6
|
)%
|
|
|||||
VoIP*
|
89.5
|
|
|
70.0
|
|
|
19.5
|
|
|
28
|
%
|
|
54.0
|
|
|
16.0
|
|
|
30
|
%
|
|
|||||
Total business voice lines
|
304.9
|
|
|
308.0
|
|
|
(3.1
|
)
|
|
(1
|
)%
|
|
307.9
|
|
|
0.1
|
|
|
0
|
%
|
|
|||||
Total voice lines
|
522.7
|
|
|
546.3
|
|
|
(23.6
|
)
|
|
(4
|
)%
|
|
579.3
|
|
|
(33.0
|
)
|
|
(6
|
)%
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long distance lines:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential
|
199.4
|
|
|
212.5
|
|
|
(13.1
|
)
|
|
(6
|
)%
|
|
236.2
|
|
|
(23.7
|
)
|
|
(10
|
)%
|
|
|||||
Business
|
140.3
|
|
|
150.3
|
|
|
(10.0
|
)
|
|
(7
|
)%
|
|
157.9
|
|
|
(7.6
|
)
|
|
(5
|
)%
|
|
|||||
Total long distance lines:
|
339.7
|
|
|
362.8
|
|
|
(23.1
|
)
|
|
(6
|
)%
|
|
394.1
|
|
|
(31.3
|
)
|
|
(8
|
)%
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
* VoIP lines include Fioptics voice lines
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
Year ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
|||||||||
Revenue:
|
|
|
|
|
|
|||||||||
|
Consumer
|
|
|
|
|
|
||||||||
|
|
Strategic
|
|
|
|
|
|
|||||||
|
|
|
Data
|
$
|
72.7
|
|
|
$
|
48.4
|
|
|
$
|
29.7
|
|
|
|
|
Voice
|
19.7
|
|
|
17.7
|
|
|
14.9
|
|
|||
|
|
|
Video
|
94.8
|
|
|
73.9
|
|
|
53.1
|
|
|||
|
|
|
Services and other
|
3.7
|
|
|
4.0
|
|
|
4.1
|
|
|||
|
|
|
|
190.9
|
|
|
144.0
|
|
|
101.8
|
|
|||
|
|
Legacy
|
|
|
|
|
|
|||||||
|
|
|
Data
|
49.5
|
|
|
58.5
|
|
|
59.9
|
|
|||
|
|
|
Voice
|
86.1
|
|
|
101.1
|
|
|
122.7
|
|
|||
|
|
|
Services and other
|
6.7
|
|
|
7.7
|
|
|
8.2
|
|
|||
|
|
|
|
142.3
|
|
|
167.3
|
|
|
190.8
|
|
|||
|
|
Integration
|
|
|
|
|
|
|||||||
|
|
|
Services and other
|
7.7
|
|
|
11.2
|
|
|
6.0
|
|
|||
|
Total consumer revenue
|
$
|
340.9
|
|
|
$
|
322.5
|
|
|
$
|
298.6
|
|
||
|
|
|
|
|
|
|
|
|
||||||
|
Business
|
|
|
|
|
|
||||||||
|
|
Strategic
|
|
|
|
|
|
|||||||
|
|
|
Data
|
$
|
89.6
|
|
|
$
|
83.6
|
|
|
$
|
74.1
|
|
|
|
|
Voice
|
42.5
|
|
|
35.9
|
|
|
31.8
|
|
|||
|
|
|
Video
|
1.8
|
|
|
1.6
|
|
|
1.5
|
|
|||
|
|
|
Services and other
|
3.2
|
|
|
3.8
|
|
|
5.7
|
|
|||
|
|
|
|
137.1
|
|
|
124.9
|
|
|
113.1
|
|
|||
|
|
Legacy
|
|
|
|
|
|
|||||||
|
|
|
Data
|
23.2
|
|
|
27.6
|
|
|
31.3
|
|
|||
|
|
|
Voice
|
123.6
|
|
|
134.2
|
|
|
144.7
|
|
|||
|
|
|
Services and other
|
1.3
|
|
|
1.2
|
|
|
2.2
|
|
|||
|
|
|
|
148.1
|
|
|
163.0
|
|
|
178.2
|
|
|||
|
|
Integration
|
|
|
|
|
|
|||||||
|
|
|
Services and other
|
2.6
|
|
|
4.7
|
|
|
6.7
|
|
|||
|
Total business revenue
|
$
|
287.8
|
|
|
$
|
292.6
|
|
|
$
|
298.0
|
|
||
|
|
|
|
|
|
|
|
|
||||||
|
Carrier
|
|
|
|
|
|
||||||||
|
|
Strategic
|
|
|
|
|
|
|||||||
|
|
|
Data
|
$
|
37.7
|
|
|
$
|
41.6
|
|
|
$
|
37.7
|
|
|
|
Legacy
|
|
|
|
|
|
|||||||
|
|
|
Data
|
50.1
|
|
|
49.9
|
|
|
53.2
|
|
|||
|
|
|
Voice
|
20.0
|
|
|
24.6
|
|
|
28.1
|
|
|||
|
|
|
Services and other
|
7.2
|
|
|
9.5
|
|
|
9.2
|
|
|||
|
|
|
|
77.3
|
|
|
84.0
|
|
|
90.5
|
|
|||
|
Total carrier revenue
|
115.0
|
|
|
125.6
|
|
|
128.2
|
|
|||||
|
|
|
|
|
|
|
|
|
||||||
Total Entertainment and Communications revenue
|
$
|
743.7
|
|
|
$
|
740.7
|
|
|
$
|
724.8
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Fioptics capital expenditures
|
|
|
|
|
|
|
||||||
Construction
|
|
$
|
86.5
|
|
|
$
|
50.0
|
|
|
$
|
45.6
|
|
Installation
|
|
50.2
|
|
|
24.3
|
|
|
25.3
|
|
|||
Other
|
|
42.8
|
|
|
18.8
|
|
|
8.6
|
|
|||
Total Fioptics
|
|
179.5
|
|
|
93.1
|
|
|
79.5
|
|
|||
|
|
|
|
|
|
|
||||||
Other strategic
|
|
44.4
|
|
|
26.9
|
|
|
35.1
|
|
|||
Maintenance
|
|
45.6
|
|
|
43.7
|
|
|
48.0
|
|
|||
Total capital expenditures
|
|
$
|
269.5
|
|
|
$
|
163.7
|
|
|
$
|
162.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
$ Change
|
|
% Change
|
|
|
|
$ Change
|
|
% Change
|
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015 vs. 2014
|
|
2015 vs. 2014
|
|
2013
|
|
2014 vs. 2013
|
|
2014 vs. 2013
|
|
||||||||||||
Revenue
|
$
|
435.4
|
|
|
$
|
433.0
|
|
|
$
|
2.4
|
|
|
1
|
%
|
|
$
|
344.1
|
|
|
$
|
88.9
|
|
|
26
|
%
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of services and products
|
345.2
|
|
|
350.0
|
|
|
(4.8
|
)
|
|
(1
|
)%
|
|
279.8
|
|
|
70.2
|
|
|
25
|
%
|
|
|||||
Selling, general and administrative
|
54.0
|
|
|
51.5
|
|
|
2.5
|
|
|
5
|
%
|
|
44.6
|
|
|
6.9
|
|
|
15
|
%
|
|
|||||
Depreciation and amortization
|
12.3
|
|
|
11.7
|
|
|
0.6
|
|
|
5
|
%
|
|
10.5
|
|
|
1.2
|
|
|
11
|
%
|
|
|||||
Restructuring charges
|
2.8
|
|
|
—
|
|
|
2.8
|
|
|
n/m
|
|
|
0.7
|
|
|
(0.7
|
)
|
|
n/m
|
|
|
|||||
Loss on sale or disposal of assets
|
0.5
|
|
|
—
|
|
|
0.5
|
|
|
n/m
|
|
|
—
|
|
|
—
|
|
|
n/m
|
|
|
|||||
Total operating costs and expenses
|
414.8
|
|
|
413.2
|
|
|
1.6
|
|
|
0
|
%
|
|
335.6
|
|
|
77.6
|
|
|
23
|
%
|
|
|||||
Operating income
|
$
|
20.6
|
|
|
$
|
19.8
|
|
|
$
|
0.8
|
|
|
4
|
%
|
|
$
|
8.5
|
|
|
$
|
11.3
|
|
|
n/m
|
|
|
Operating margin
|
4.7
|
%
|
|
4.6
|
%
|
|
|
|
0.1
|
|
pts
|
2.5
|
%
|
|
|
|
2.1
|
|
pts
|
|||||||
Capital expenditures
|
$
|
14.0
|
|
|
$
|
11.9
|
|
|
$
|
2.1
|
|
|
18
|
%
|
|
$
|
10.6
|
|
|
$
|
1.3
|
|
|
12
|
%
|
|
|
|
Year ended December 31,
|
||||||||||
(dollars in millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Strategic business revenue
|
|
|
|
|
|
|
||||||
Professional services
|
|
$
|
90.4
|
|
|
$
|
70.2
|
|
|
$
|
63.9
|
|
Management and monitoring
|
|
31.0
|
|
|
24.8
|
|
|
19.2
|
|
|||
Unified communications
|
|
27.1
|
|
|
22.9
|
|
|
18.6
|
|
|||
Cloud services
|
|
30.9
|
|
|
20.8
|
|
|
16.4
|
|
|||
Total strategic business revenue
|
|
179.4
|
|
|
138.7
|
|
|
118.1
|
|
|||
|
|
|
|
|
|
|
||||||
Integration business revenue
|
|
|
|
|
|
|
||||||
Professional services
|
|
15.1
|
|
|
16.4
|
|
|
11.7
|
|
|||
Management and monitoring
|
|
—
|
|
|
0.4
|
|
|
0.4
|
|
|||
Unified communications
|
|
10.7
|
|
|
12.2
|
|
|
13.0
|
|
|||
Telecom and IT hardware
|
|
230.2
|
|
|
265.3
|
|
|
200.9
|
|
|||
Total integration business revenue
|
|
256.0
|
|
|
294.3
|
|
|
226.0
|
|
|||
Total IT Services and Hardware revenue
|
|
$
|
435.4
|
|
|
$
|
433.0
|
|
|
$
|
344.1
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
Payments due by Period
|
||||||||||||||||||
(dollars in millions)
|
|
Total
|
|
< 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
Thereafter
|
||||||||||
Long-term debt, excluding capital leases (1)
|
|
$
|
1,179.7
|
|
|
$
|
5.9
|
|
|
$
|
28.6
|
|
|
$
|
990.2
|
|
|
$
|
155.0
|
|
Capital leases (2)
|
|
67.6
|
|
|
7.9
|
|
|
9.0
|
|
|
6.4
|
|
|
44.3
|
|
|||||
Interest payments on long-term debt, capital leases, and other financing arrangements (3)
|
|
453.0
|
|
|
76.2
|
|
|
149.9
|
|
|
139.7
|
|
|
87.2
|
|
|||||
Non-cancellable operating lease obligations
|
|
37.0
|
|
|
3.9
|
|
|
6.3
|
|
|
4.8
|
|
|
22.0
|
|
|||||
Purchase obligations (4)
|
|
165.6
|
|
|
140.7
|
|
|
24.3
|
|
|
0.6
|
|
|
—
|
|
|||||
Pension and postretirement benefits obligations (5)
|
|
67.6
|
|
|
12.4
|
|
|
17.0
|
|
|
21.0
|
|
|
17.2
|
|
|||||
Unrecognized tax benefits (6)
|
|
27.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27.6
|
|
|||||
Other liabilities (7)
|
|
28.1
|
|
|
12.1
|
|
|
2.8
|
|
|
1.0
|
|
|
12.2
|
|
|||||
Total
|
|
$
|
2,026.2
|
|
|
$
|
259.1
|
|
|
$
|
237.9
|
|
|
$
|
1,163.7
|
|
|
$
|
365.5
|
|
(1)
|
Long-term debt excludes net unamortized discounts and premiums.
|
|
|
(2)
|
Includes capital lease obligations and the associated asset retirement obligations primarily related to wireless towers and vehicles used in the deployment of our fiber network.
|
|
|
(3)
|
Interest payments on both fixed and variable rate long-term debt, capital leases, and other financing arrangements assuming no early payment of debt in future periods. The interest rate applied on variable rate borrowings is the rate in effect as of December 31, 2015.
|
|
|
(4)
|
Purchase obligations primarily consist of amounts under open purchase orders and open blanket purchase orders for purchases of network, IT and telephony equipment, and other goods; contractual obligations for services such as software maintenance and outsourced services; and other purchase commitments.
|
|
|
(5)
|
Included in pension and postretirement benefit obligations are payments for postretirement benefits, qualified pension plans, non-qualified pension plan and other employee retirement agreements. Amounts for 2016 include approximately $10 million expected to be contributed for postretirement benefits. Although the Company expects to continue operating the plans past 2016, its contractual obligation related to postretirement obligations only extends through 2016. Amounts for 2016 through 2023 include approximately $38 million of estimated cash contributions to its qualified pension plans, but no contributions are expected to be made until 2018. Expected qualified pension plan contributions are based on current plan design, legislation and current actuarial assumptions. Any changes in plan design, legislation or actuarial assumptions may also affect the expected contribution amount.
|
|
|
(6)
|
Includes the portion of liabilities related to unrecognized tax benefits. If the timing of payments cannot be reasonably estimated for unrecognized tax benefits, these liabilities are included in the "Thereafter" column of the table above.
|
|
|
(7)
|
Includes contractual obligations primarily related to restructuring reserves, asset removal obligations, long-term disability obligations, workers compensation liabilities and long-term incentive plan obligations.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
•
|
|
revenue recognition;
|
|
|
|
•
|
|
accounting for allowances for uncollectible accounts receivable;
|
|
|
|
•
|
|
reviewing the carrying value of goodwill;
|
|
|
|
•
|
|
reviewing the carrying values of long-lived assets;
|
|
|
|
•
|
|
accounting for discontinued operations;
|
|
|
|
•
|
|
accounting for income taxes; and
|
|
|
|
•
|
|
accounting for pension and postretirement expenses.
|
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
Pension Benefits
|
|
Postretirement and Other Benefits
|
||||
|
|
|
|
(Decrease)/
|
|
(Decrease)/
|
|
(Decrease)/
|
|
(Decrease)/
|
|
|
% Point
|
|
Increase in
|
|
Increase in
|
|
Increase in
|
|
Increase in
|
(dollars in millions)
|
|
Change
|
|
Obligation
|
|
Expense
|
|
Obligation
|
|
Expense
|
Discount rate
|
|
+/- 0.5%
|
|
($25.3)/$25.3
|
|
($0.8)/$0.8
|
|
($3.9)/$4.3
|
|
($0.1)/$0.1
|
Expected return on assets
|
|
+/- 0.5%
|
|
n/a
|
|
$1.9/($1.9)
|
|
n/a
|
|
$0.1/($0.1)
|
Healthcare cost trend rate
|
|
+/- 1.0%
|
|
n/a
|
|
n/a
|
|
$4.2/($3.8)
|
|
$0.2/($0.1)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
•
|
the Company operates in highly competitive industries, and customers may not continue to purchase products or services, which would result in reduced revenue and loss of market share;
|
|
|
•
|
accelerating the pace of investment in our Fioptics suite of products could have a negative impact on our financial results;
|
•
|
the Company may be unable to grow revenue and cash flows despite the initiatives we have implemented;
|
•
|
failure to anticipate the need for and introduce new products and services or to compete with new technologies may compromise the Company's success in the telecommunications industry;
|
|
|
•
|
the Company’s access lines, which generate a significant portion of its cash flows and profits, are decreasing in number. If the Company continues to experience access line losses similar to the past several years, its revenues, earnings and cash flows from operations may be adversely impacted;
|
|
|
|
|
•
|
the Company's failure to meet performance standards under its agreements could result in customers terminating their relationships with the Company or customers being entitled to receive financial compensation, which could lead to reduced revenues and/or increased costs;
|
|
|
•
|
the Company generates a substantial portion of its revenue by serving a limited geographic area;
|
|
|
•
|
a large customer accounts for a significant portion of the Company’s revenues and accounts receivable. The loss or significant reduction in business from this customer could cause operating revenues to decline significantly and have a materially adverse long-term impact on the Company's business;
|
|
|
•
|
maintaining the Company's telecommunications networks requires significant capital expenditures, and its inability or failure to maintain its telecommunications networks would have a material impact on its market share and ability to generate revenue;
|
|
|
•
|
increases in broadband usage may cause network capacity limitations, resulting in service disruptions or reduced capacity for customers;
|
|
|
•
|
we may be liable for material that content providers distribute on our networks;
|
|
|
•
|
cyber attacks or other breaches of network or other information technology security could have an adverse effect on our business;
|
|
|
•
|
natural disasters, terrorists acts or acts of war could cause damage to our infrastructure and result in significant
disruptions to our operations;
|
|
|
•
|
the regulation of the Company's businesses by federal and state authorities may, among other things, place the Company at a competitive disadvantage, restrict its ability to price its products and services and threaten its operating licenses;
|
|
|
•
|
the Company depends on a number of third party providers, and the loss of, or problems with, one or more of these providers may impede the Company's growth or cause it to lose customers;
|
|
|
•
|
a failure of back-office information technology systems could adversely affect the Company's results of operations and financial condition;
|
|
|
•
|
if the Company fails to extend or renegotiate its collective bargaining agreements with its labor union when they expire or if its unionized employees were to engage in a strike or other work stoppage, the Company's business and operating results could be materially harmed;
|
|
|
•
|
the loss of any of the senior management team or attrition among key sales associates could adversely affect the Company's business, financial condition, results of operations and cash flows;
|
|
|
•
|
the Company’s debt could limit its ability to fund operations, raise additional capital, and fulfill its obligations, which, in turn, would have a material adverse effect on its businesses and prospects generally;
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
•
|
the Corporate Credit Agreement and other indebtedness impose significant restrictions on the Company;
|
|
|
•
|
the Company depends on its Corporate Credit Agreement's revolving credit facility and Receivables Facility to provide for its short-term financing requirements in excess of amounts generated by operations, and the availability of those funds may be reduced or limited;
|
|
|
•
|
the servicing of the Company's indebtedness is dependent on its ability to generate cash, which could be impacted by many factors beyond its control;
|
|
|
•
|
the Company depends on the receipt of dividends or other intercompany transfers from its subsidiaries and investments;
|
|
|
•
|
the Company has a significant investment in CyrusOne;
|
|
|
|
|
•
|
the trading price of the Company's common stock may be volatile, and the value of an investment in the Company's common stock may decline;
|
|
|
•
|
the uncertain economic environment, including uncertainty in the U.S. and world securities markets, could impact the Company's business and financial condition;
|
|
|
•
|
the Company's future cash flows could be adversely affected if it is unable to fully realize its deferred tax assets;
|
|
|
•
|
adverse changes in the value of assets or obligations associated with the Company's employee benefit plans could negatively impact shareowners' deficit and liquidity;
|
|
|
•
|
third parties may claim that the Company is infringing upon their intellectual property, and the Company could suffer significant litigation or licensing expenses or be prevented from selling products;
|
|
|
•
|
third parties may infringe upon the Company’s intellectual property, and the Company may expend significant resources enforcing its rights or suffer competitive injury;
|
|
|
•
|
we could be subject to a significant amount of litigation, which could require us to pay significant damages or settlements; and
|
|
|
•
|
the Company could incur significant costs resulting from complying with, or potential violations of, environmental, health and human safety laws.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
|
Total
|
|
Fair Value
|
||||||||||||||||
Fixed-rate debt:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
478.5
|
|
|
$
|
155.0
|
|
|
$
|
633.5
|
|
|
$
|
628.5
|
|
Weighted average interest rate on fixed-rate debt
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.4
|
%
|
|
6.5
|
%
|
|
7.9
|
%
|
|
|
|||||||||
Variable-rate debt:
|
|
$
|
5.4
|
|
|
$
|
5.4
|
|
|
$
|
23.0
|
|
|
$
|
5.4
|
|
|
$
|
506.3
|
|
|
$
|
—
|
|
|
$
|
545.5
|
|
|
$
|
526.4
|
|
Average interest rate on variable-rate debt
|
|
4.0
|
%
|
|
4.0
|
%
|
|
1.7
|
%
|
|
4.0
|
%
|
|
4.0
|
%
|
|
—
|
|
|
3.9
|
%
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Item 8. Financial Statements and Supplementary Data
|
|
|
|
|
|
Index to Consolidated Financial Statements
|
Page
|
|
|
|
|
Consolidated Financial Statements:
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
Financial Statement Schedule:
|
|
|
|
|
|
|
For each of the three years in the period ended December 31, 2015:
|
|
|
|
|
|
||
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
/s/ Theodore H. Torbeck
|
|
Theodore H. Torbeck
|
|
President and Chief Executive Officer
|
|
|
|
/s/ Leigh R. Fox
|
|
Leigh R. Fox
|
|
Chief Financial Officer
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
7.4
|
|
|
$
|
57.9
|
|
Receivables, less allowances of $12.4 and $12.4
|
154.9
|
|
|
160.8
|
|
||
Receivable from CyrusOne
|
2.2
|
|
|
7.7
|
|
||
Inventory, materials and supplies
|
20.6
|
|
|
25.0
|
|
||
Prepaid expenses
|
13.1
|
|
|
10.8
|
|
||
Other current assets
|
2.2
|
|
|
1.8
|
|
||
Other current assets from discontinued operations
|
—
|
|
|
4.7
|
|
||
Total current assets
|
200.4
|
|
|
268.7
|
|
||
Property, plant and equipment, net
|
975.5
|
|
|
815.4
|
|
||
Investment in CyrusOne
|
55.5
|
|
|
273.6
|
|
||
Goodwill
|
14.3
|
|
|
14.4
|
|
||
Intangible assets, net
|
0.2
|
|
|
0.5
|
|
||
Deferred income taxes, net
|
182.9
|
|
|
369.6
|
|
||
Other noncurrent assets
|
25.6
|
|
|
33.9
|
|
||
Noncurrent assets from discontinued operations
|
—
|
|
|
44.6
|
|
||
Total assets
|
$
|
1,454.4
|
|
|
$
|
1,820.7
|
|
Liabilities and Shareowners’ Deficit
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current portion of long-term debt
|
$
|
13.8
|
|
|
$
|
11.6
|
|
Accounts payable
|
127.4
|
|
|
131.6
|
|
||
Payable to CyrusOne
|
1.5
|
|
|
0.4
|
|
||
Unearned revenue and customer deposits
|
29.2
|
|
|
30.4
|
|
||
Accrued taxes
|
14.5
|
|
|
9.9
|
|
||
Accrued interest
|
11.2
|
|
|
22.1
|
|
||
Accrued payroll and benefits
|
31.2
|
|
|
37.0
|
|
||
Other current liabilities
|
25.0
|
|
|
25.8
|
|
||
Other current liabilities from discontinued operations
|
5.4
|
|
|
142.0
|
|
||
Total current liabilities
|
259.2
|
|
|
410.8
|
|
||
Long-term debt, less current portion
|
1,231.8
|
|
|
1,689.4
|
|
||
Pension and postretirement benefit obligations
|
225.0
|
|
|
240.1
|
|
||
Other noncurrent liabilities
|
36.6
|
|
|
26.2
|
|
||
Noncurrent liabilities from discontinued operations
|
—
|
|
|
102.7
|
|
||
Total liabilities
|
1,752.6
|
|
|
2,469.2
|
|
||
Shareowners’ deficit
|
|
|
|
||||
Preferred stock, 2,357,299 shares authorized; 155,250 shares (3,105,000 depositary shares) of 6
3
/
4
% Cumulative Convertible Preferred Stock issued and outstanding at December 31, 2015 and 2014; liquidation preference $1,000 per share ($50 per depositary share)
|
129.4
|
|
|
129.4
|
|
||
Common shares, $.01 par value; 480,000,000 shares authorized; 210,017,999 and 209,571,138 shares issued; 209,876,949 and 209,296,068 shares outstanding at December 31, 2015 and 2014
|
2.1
|
|
|
2.1
|
|
||
Additional paid-in capital
|
2,576.0
|
|
|
2,582.9
|
|
||
Accumulated deficit
|
(2,834.2
|
)
|
|
(3,187.9
|
)
|
||
Accumulated other comprehensive loss
|
(171.0
|
)
|
|
(173.9
|
)
|
||
Common shares in treasury, at cost
|
(0.5
|
)
|
|
(1.1
|
)
|
||
Total shareowners’ deficit
|
(298.2
|
)
|
|
(648.5
|
)
|
||
Total liabilities and shareowners’ deficit
|
$
|
1,454.4
|
|
|
$
|
1,820.7
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Revenue
|
|
|
|
|
|
||||||
Services
|
$
|
933.0
|
|
|
$
|
890.2
|
|
|
$
|
871.9
|
|
Products
|
234.8
|
|
|
271.3
|
|
|
201.5
|
|
|||
Total revenue
|
1,167.8
|
|
|
1,161.5
|
|
|
1,073.4
|
|
|||
Costs and expenses
|
|
|
|
|
|
||||||
Cost of services, excluding items below
|
472.5
|
|
|
416.2
|
|
|
386.2
|
|
|||
Cost of products sold, excluding items below
|
198.1
|
|
|
231.5
|
|
|
175.1
|
|
|||
Selling, general and administrative
|
219.1
|
|
|
204.2
|
|
|
187.9
|
|
|||
Depreciation and amortization
|
141.6
|
|
|
127.6
|
|
|
128.4
|
|
|||
Restructuring charges (reversals)
|
6.0
|
|
|
(0.4
|
)
|
|
13.5
|
|
|||
Transaction-related compensation
|
—
|
|
|
—
|
|
|
42.6
|
|
|||
Curtailment loss (gain)
|
0.3
|
|
|
—
|
|
|
(0.6
|
)
|
|||
Loss (gain) on sale or disposal of assets, net
|
0.8
|
|
|
(0.3
|
)
|
|
(1.1
|
)
|
|||
Impairment of assets
|
—
|
|
|
4.6
|
|
|
—
|
|
|||
Transaction costs
|
1.4
|
|
|
1.2
|
|
|
1.6
|
|
|||
Total operating costs and expenses
|
1,039.8
|
|
|
984.6
|
|
|
933.6
|
|
|||
Operating income
|
128.0
|
|
|
176.9
|
|
|
139.8
|
|
|||
Interest expense
|
103.1
|
|
|
145.9
|
|
|
176.0
|
|
|||
Loss on extinguishment of debt
|
20.9
|
|
|
19.6
|
|
|
29.6
|
|
|||
Loss from CyrusOne investment
|
5.1
|
|
|
7.0
|
|
|
10.7
|
|
|||
Gain on sale of CyrusOne investment
|
(449.2
|
)
|
|
(192.8
|
)
|
|
—
|
|
|||
Other income, net
|
(2.5
|
)
|
|
(1.9
|
)
|
|
(3.3
|
)
|
|||
Income (loss) from continuing operations before income taxes
|
450.6
|
|
|
199.1
|
|
|
(73.2
|
)
|
|||
Income tax expense (benefit)
|
159.8
|
|
|
81.4
|
|
|
(8.3
|
)
|
|||
Income (loss) from continuing operations
|
290.8
|
|
|
117.7
|
|
|
(64.9
|
)
|
|||
Income (loss) from discontinued operations, net of tax
|
62.9
|
|
|
(42.1
|
)
|
|
10.2
|
|
|||
Net income (loss)
|
353.7
|
|
|
75.6
|
|
|
(54.7
|
)
|
|||
Preferred stock dividends
|
10.4
|
|
|
10.4
|
|
|
10.4
|
|
|||
Net income (loss) applicable to common shareowners
|
$
|
343.3
|
|
|
$
|
65.2
|
|
|
$
|
(65.1
|
)
|
Basic net earnings (loss) per common share
|
|
|
|
|
|
||||||
Basic earnings (loss) per common share from continuing operations
|
$
|
1.34
|
|
|
$
|
0.51
|
|
|
$
|
(0.37
|
)
|
Basic earnings (loss) per common share from discontinued operations
|
$
|
0.30
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.05
|
|
Basic net earnings (loss) per common share
|
$
|
1.64
|
|
|
$
|
0.31
|
|
|
$
|
(0.32
|
)
|
Diluted net earnings (loss) per common share
|
|
|
|
|
|
||||||
Diluted earnings (loss) per common share from continuing operations
|
$
|
1.33
|
|
|
$
|
0.51
|
|
|
$
|
(0.37
|
)
|
Diluted earnings (loss) per common share from discontinued operations
|
$
|
0.30
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.05
|
|
Diluted net earnings (loss) per common share
|
$
|
1.63
|
|
|
$
|
0.31
|
|
|
$
|
(0.32
|
)
|
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding (millions)
|
|
|
|
|
|
||||||
Basic
|
209.6
|
|
|
208.5
|
|
|
205.9
|
|
|||
Diluted
|
210.2
|
|
|
209.6
|
|
|
205.9
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net income (loss)
|
$
|
353.7
|
|
|
$
|
75.6
|
|
|
$
|
(54.7
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Foreign currency translation loss
|
(0.4
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||
Defined benefit plans:
|
|
|
|
|
|
||||||
Net (loss) gain arising from remeasurement during the period, net of tax of ($3.4), ($25.0), $30.7
|
(6.6
|
)
|
|
(45.4
|
)
|
|
56.8
|
|
|||
Net prior service credit, net of tax of $6.1
|
—
|
|
|
—
|
|
|
11.3
|
|
|||
Amortization of prior service benefits included in net income (loss), net of tax of ($5.5), ($5.4), ($5.2)
|
(9.8
|
)
|
|
(9.8
|
)
|
|
(8.7
|
)
|
|||
Amortization of net actuarial loss included in net income (loss), net of tax of $10.8, $8.0, $10.1
|
19.5
|
|
|
14.7
|
|
|
17.5
|
|
|||
Reclassification adjustment for curtailment loss (gain) included in net income (loss), net of tax of $0.1, ($0.2)
|
0.2
|
|
|
—
|
|
|
(0.4
|
)
|
|||
Total other comprehensive income (loss), net of tax
|
2.9
|
|
|
(40.6
|
)
|
|
76.4
|
|
|||
Total comprehensive income
|
$
|
356.6
|
|
|
$
|
35.0
|
|
|
$
|
21.7
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
6
3
/
4
% Cumulative
Convertible
Preferred Shares
|
|
Common Shares
|
|
Additional
Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Treasury Shares
|
|
|
|||||||||||||||||||||||
|
|
|
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
Shares
|
|
Amount
|
|
Total
|
||||||||||||||||||||
Balance at December 31, 2012
|
3.1
|
|
|
$
|
129.4
|
|
|
203.0
|
|
|
$
|
2.0
|
|
|
$
|
2,590.9
|
|
|
$
|
(3,208.8
|
)
|
|
$
|
(209.7
|
)
|
|
(0.5
|
)
|
|
$
|
(2.0
|
)
|
|
$
|
(698.2
|
)
|
||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(54.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(54.7
|
)
|
||||||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
76.4
|
|
|
—
|
|
|
—
|
|
|
76.4
|
|
||||||||||
Shares issued under employee plans
|
|
—
|
|
|
—
|
|
|
1.6
|
|
|
—
|
|
|
2.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.4
|
|
||||||||||
Shares purchased under employee plans and other
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
|
(2.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.3
|
)
|
||||||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.9
|
|
||||||||||
Exercise of warrants
|
|
—
|
|
|
—
|
|
|
4.4
|
|
|
0.1
|
|
|
5.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.2
|
|
||||||||||
Dividends on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.4
|
)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Balance at December 31, 2013
|
3.1
|
|
|
129.4
|
|
|
208.7
|
|
|
2.1
|
|
|
2,590.6
|
|
|
(3,263.5
|
)
|
|
(133.3
|
)
|
|
(0.5
|
)
|
|
(2.0
|
)
|
|
(676.7
|
)
|
|||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75.6
|
|
||||||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(40.6
|
)
|
|
—
|
|
|
—
|
|
|
(40.6
|
)
|
||||||||||
Shares issued under employee plans
|
|
—
|
|
|
—
|
|
|
1.1
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.4
|
|
||||||||||
Shares purchased under employee plans and other
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(2.0
|
)
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.9
|
|
|
(1.1
|
)
|
||||||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.3
|
|
||||||||||
Dividends on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.4
|
)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Balance at December 31, 2014
|
3.1
|
|
|
129.4
|
|
|
209.6
|
|
|
2.1
|
|
|
2,582.9
|
|
|
(3,187.9
|
)
|
|
(173.9
|
)
|
|
(0.3
|
)
|
|
(1.1
|
)
|
|
(648.5
|
)
|
|||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353.7
|
|
||||||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.9
|
|
|
—
|
|
|
—
|
|
|
2.9
|
|
||||||||||
Shares issued under employee plans
|
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
||||||||||
Shares purchased under employee plans and other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.6
|
|
|
(0.1
|
)
|
||||||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.1
|
|
||||||||||
Dividends on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.4
|
)
|
||||||||||
Balance at December 31, 2015
|
3.1
|
|
|
$
|
129.4
|
|
|
210.0
|
|
|
$
|
2.1
|
|
|
$
|
2,576.0
|
|
|
$
|
(2,834.2
|
)
|
|
$
|
(171.0
|
)
|
|
(0.1
|
)
|
|
$
|
(0.5
|
)
|
|
$
|
(298.2
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
353.7
|
|
|
$
|
75.6
|
|
|
$
|
(54.7
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
170.2
|
|
|
231.0
|
|
|
169.6
|
|
|||
Loss on extinguishment of debt
|
20.9
|
|
|
19.6
|
|
|
29.6
|
|
|||
Loss from CyrusOne investment
|
5.1
|
|
|
7.0
|
|
|
10.7
|
|
|||
Gain on sale of CyrusOne investment
|
(449.2
|
)
|
|
(192.8
|
)
|
|
—
|
|
|||
Loss (gain) on sale of assets
|
0.4
|
|
|
(0.3
|
)
|
|
2.4
|
|
|||
Impairment of assets
|
—
|
|
|
12.1
|
|
|
—
|
|
|||
Provision for loss on receivables
|
8.5
|
|
|
10.4
|
|
|
11.3
|
|
|||
Noncash portion of interest expense
|
4.6
|
|
|
6.2
|
|
|
7.5
|
|
|||
Deferred income tax expense (benefit), including valuation allowance change
|
184.5
|
|
|
47.4
|
|
|
(2.7
|
)
|
|||
Pension and other postretirement payments in excess of expense
|
(11.5
|
)
|
|
(25.7
|
)
|
|
(49.7
|
)
|
|||
Deferred gain on sale of wireless spectrum licenses - discontinued operations
|
(112.6
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of deferred gain - discontinued operations
|
(6.5
|
)
|
|
(22.9
|
)
|
|
(3.3
|
)
|
|||
Stock-based compensation
|
4.1
|
|
|
3.3
|
|
|
4.9
|
|
|||
Excess tax benefit for share based payments
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.5
|
)
|
|||
Gain on transfer of lease obligations - discontinued operations
|
(15.9
|
)
|
|
—
|
|
|
—
|
|
|||
Other, net
|
(2.3
|
)
|
|
3.9
|
|
|
(3.4
|
)
|
|||
Changes in operating assets and liabilities, net of effects of divestitures:
|
|
|
|
|
|
||||||
(Increase) decrease in receivables
|
(1.9
|
)
|
|
(23.7
|
)
|
|
0.5
|
|
|||
Decrease (increase) in inventory, materials, supplies, prepaid expenses and other current assets
|
3.6
|
|
|
(7.2
|
)
|
|
(0.8
|
)
|
|||
(Decrease) increase in accounts payable
|
(17.0
|
)
|
|
38.7
|
|
|
(17.7
|
)
|
|||
Decrease in accrued and other current liabilities
|
(30.6
|
)
|
|
(0.8
|
)
|
|
(18.1
|
)
|
|||
Decrease in other noncurrent assets
|
1.5
|
|
|
0.7
|
|
|
0.8
|
|
|||
Increase (decrease) in other noncurrent liabilities
|
1.4
|
|
|
(7.2
|
)
|
|
(7.6
|
)
|
|||
Net cash provided by operating activities
|
110.9
|
|
|
175.2
|
|
|
78.8
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Capital expenditures
|
(283.6
|
)
|
|
(182.3
|
)
|
|
(196.9
|
)
|
|||
Proceeds from sale of CyrusOne investment
|
643.9
|
|
|
355.9
|
|
|
—
|
|
|||
Dividends received from CyrusOne
|
22.2
|
|
|
28.4
|
|
|
21.3
|
|
|||
Proceeds from sale of wireless spectrum licenses
|
—
|
|
|
194.4
|
|
|
—
|
|
|||
Proceeds from sale of assets
|
1.0
|
|
|
2.0
|
|
|
2.0
|
|
|||
Release of restricted cash
|
—
|
|
|
—
|
|
|
0.4
|
|
|||
Cash divested from deconsolidation of CyrusOne
|
—
|
|
|
—
|
|
|
(12.2
|
)
|
|||
Other, net
|
(0.3
|
)
|
|
(5.8
|
)
|
|
—
|
|
|||
Net cash provided by (used in) investing activities
|
383.2
|
|
|
392.6
|
|
|
(185.4
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Proceeds from issuance of long-term debt
|
—
|
|
|
—
|
|
|
536.0
|
|
|||
Net (decrease) increase in corporate credit and receivables facilities with initial maturities less than 90 days
|
(1.6
|
)
|
|
(127.0
|
)
|
|
94.2
|
|
|||
Repayment of debt
|
(531.7
|
)
|
|
(376.5
|
)
|
|
(530.8
|
)
|
|||
Debt issuance costs
|
(0.4
|
)
|
|
(0.9
|
)
|
|
(6.7
|
)
|
|||
Dividends paid on preferred stock
|
(10.4
|
)
|
|
(10.4
|
)
|
|
(10.4
|
)
|
|||
Proceeds from exercise of options and warrants
|
—
|
|
|
1.3
|
|
|
7.1
|
|
|||
Excess tax benefit for share based payments
|
0.1
|
|
|
0.1
|
|
|
0.5
|
|
|||
Other, net
|
(0.6
|
)
|
|
(1.1
|
)
|
|
(2.3
|
)
|
|||
Net cash (used in) provided by financing activities
|
(544.6
|
)
|
|
(514.5
|
)
|
|
87.6
|
|
|||
Net (decrease) increase in cash and cash equivalents
|
(50.5
|
)
|
|
53.3
|
|
|
(19.0
|
)
|
|||
Cash and cash equivalents at beginning of year
|
57.9
|
|
|
4.6
|
|
|
23.6
|
|
|||
Cash and cash equivalents at end of year
|
$
|
7.4
|
|
|
$
|
57.9
|
|
|
$
|
4.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
1.
|
Description of Business and Accounting Policies
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
3.
|
Discontinued Operations
|
(dollars in millions)
|
As of April 1, 2015
|
||
Property, plant and equipment, net
|
$
|
16.0
|
|
|
|
||
Current portion of long-term debt
|
0.5
|
|
|
Long-term debt, less current portion
|
24.8
|
|
|
Other non-current liabilities
|
6.6
|
|
|
Total liabilities
|
$
|
31.9
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Twelve Months Ended
|
||||||||||
|
December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Revenue
|
$
|
4.4
|
|
|
$
|
132.8
|
|
|
$
|
201.5
|
|
Costs and expenses
|
|
|
|
|
|
||||||
Cost of products and services
|
12.0
|
|
|
66.9
|
|
|
102.3
|
|
|||
Selling, general and administrative
|
2.2
|
|
|
19.5
|
|
|
33.6
|
|
|||
Depreciation and amortization expense
|
28.6
|
|
|
103.4
|
|
|
41.2
|
|
|||
Restructuring charges
|
3.3
|
|
|
16.3
|
|
|
0.2
|
|
|||
Impairment of asset
|
—
|
|
|
7.5
|
|
|
—
|
|
|||
Transaction costs
|
—
|
|
|
3.2
|
|
|
—
|
|
|||
(Gain) loss on sale or disposal of assets
|
(0.4
|
)
|
|
—
|
|
|
3.5
|
|
|||
Amortization of deferred gain
|
(6.5
|
)
|
|
(22.9
|
)
|
|
(3.3
|
)
|
|||
Total operating costs and expenses
|
39.2
|
|
|
193.9
|
|
|
177.5
|
|
|||
Operating income (loss)
|
(34.8
|
)
|
|
(61.1
|
)
|
|
24.0
|
|
|||
Interest (income) expense
|
(1.7
|
)
|
|
2.8
|
|
|
6.0
|
|
|||
Other (income) expense
|
(2.3
|
)
|
|
2.2
|
|
|
2.0
|
|
|||
Gain on transfer of tower lease obligations and other assets
|
15.9
|
|
|
—
|
|
|
—
|
|
|||
Gain on sale of wireless spectrum licenses
|
112.6
|
|
|
—
|
|
|
—
|
|
|||
Income (loss) before income taxes
|
97.7
|
|
|
(66.1
|
)
|
|
16.0
|
|
|||
Income tax expense (benefit)
|
34.8
|
|
|
(24.0
|
)
|
|
5.8
|
|
|||
Net income (loss) from discontinued operations
|
$
|
62.9
|
|
|
$
|
(42.1
|
)
|
|
$
|
10.2
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
December 31, 2015
|
|
December 31, 2014
|
||||
Current assets
|
|
|
|
||||
Prepaid rent - spectrum license
|
$
|
—
|
|
|
$
|
3.2
|
|
Other current assets
|
—
|
|
|
1.5
|
|
||
Total current assets from discontinued operations
|
—
|
|
|
4.7
|
|
||
Property, plant and equipment
|
—
|
|
|
44.1
|
|
||
Other noncurrent assets
|
—
|
|
|
0.5
|
|
||
Total noncurrent assets from discontinued operations
|
—
|
|
|
44.6
|
|
||
Total assets from discontinued operations
|
$
|
—
|
|
|
$
|
49.3
|
|
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current portion of long-term debt
|
$
|
—
|
|
|
$
|
1.6
|
|
Accounts payable
|
—
|
|
|
5.0
|
|
||
Restructuring liability
|
4.7
|
|
|
15.4
|
|
||
Deferred gain on sale of wireless spectrum licenses
|
—
|
|
|
112.6
|
|
||
Other current liabilities
|
0.7
|
|
|
7.4
|
|
||
Total current liabilities from discontinued operations
|
5.4
|
|
|
142.0
|
|
||
Long-term debt, less current portion
|
—
|
|
|
81.6
|
|
||
Deferred gain on sale of towers
|
—
|
|
|
13.1
|
|
||
Other noncurrent liabilities
|
—
|
|
|
8.0
|
|
||
Total noncurrent liabilities from discontinued operations
|
—
|
|
|
102.7
|
|
||
Total liabilities from discontinued operations
|
$
|
5.4
|
|
|
$
|
244.7
|
|
|
Continuing Operations
|
|
Discontinued Operations
|
||||
|
As of April 1, 2015
|
|
As of December 31, 2014
|
||||
(dollars in millions)
|
|
|
|
||||
Current portion of long-term debt
|
$
|
1.1
|
|
|
$
|
1.1
|
|
Long-term debt, less current portion
|
53.4
|
|
|
57.0
|
|
||
Other noncurrent liabilities
|
10.9
|
|
|
7.5
|
|
||
Total liabilities
|
$
|
65.4
|
|
|
$
|
65.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Twelve Months Ended
|
||||||||||
|
December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Depreciation and amortization
|
$
|
28.6
|
|
|
$
|
103.4
|
|
|
$
|
41.2
|
|
(Gain) loss on sale of assets
|
(0.4
|
)
|
|
—
|
|
|
3.5
|
|
|||
Impairment of assets
|
—
|
|
|
7.5
|
|
|
—
|
|
|||
Deferred gain on sale of spectrum licenses
|
(112.6
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of deferred gain on sale of towers
|
(6.5
|
)
|
|
(22.9
|
)
|
|
(3.3
|
)
|
|||
Gain on transfer of tower lease obligations and other assets
|
(15.9
|
)
|
|
—
|
|
|
—
|
|
|||
Non-cash spectrum lease
|
3.2
|
|
|
3.2
|
|
|
—
|
|
|||
Restructuring payments
|
(14.5
|
)
|
|
(2.4
|
)
|
|
(0.3
|
)
|
|||
Capital expenditures
|
—
|
|
|
(6.5
|
)
|
|
(16.0
|
)
|
|||
Proceeds from sale of wireless spectrum licenses
|
—
|
|
|
194.4
|
|
|
—
|
|
|||
Repayment of debt
|
(0.3
|
)
|
|
(23.5
|
)
|
|
(0.6
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
4.
|
Investment in CyrusOne
|
(dollars in millions)
|
|
Year Ended December 31, 2015
|
|
Year Ended December 31, 2014
|
|
January 24, 2013 to December 31, 2013
|
||||||
Revenue
|
|
$
|
399.3
|
|
|
$
|
330.9
|
|
|
$
|
248.4
|
|
Operating income
|
|
22.8
|
|
|
40.0
|
|
|
28.9
|
|
|||
Net loss
|
|
(20.2
|
)
|
|
(14.5
|
)
|
|
(15.6
|
)
|
(dollars in millions)
|
|
December 31, 2015
|
|
December 31, 2014
|
||||
Net investment in real estate
|
|
$
|
1,392.0
|
|
|
$
|
1,051.4
|
|
Total assets
|
|
2,195.6
|
|
|
1,571.0
|
|
||
Total liabilities
|
|
1,374.0
|
|
|
854.0
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
|
Year Ended December 31, 2015
|
|
Year Ended December 31, 2014
|
|
January 24, 2013 to December 31, 2013
|
||||||
Revenue:
|
|
|
|
|
|
|
||||||
Services provided to CyrusOne
|
|
$
|
1.3
|
|
|
$
|
1.7
|
|
|
$
|
2.1
|
|
|
|
|
|
|
|
|
||||||
Operating costs and expenses:
|
|
|
|
|
|
|
||||||
Transaction-related compensation to CyrusOne employees
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20.0
|
|
Charges for services provided by CyrusOne
|
|
10.2
|
|
|
9.1
|
|
|
8.8
|
|
|||
Administrative services provided to CyrusOne
|
|
(0.4
|
)
|
|
(0.5
|
)
|
|
(0.6
|
)
|
|||
Total operating costs and expenses
|
|
$
|
9.8
|
|
|
$
|
8.6
|
|
|
$
|
28.2
|
|
(dollars in millions)
|
|
December 31, 2015
|
|
December 31, 2014
|
||||
Accounts receivable
|
|
$
|
0.1
|
|
|
$
|
1.7
|
|
Dividends receivable
|
|
2.1
|
|
|
6.0
|
|
||
Receivable from CyrusOne
|
|
$
|
2.2
|
|
|
$
|
7.7
|
|
|
|
|
|
|
||||
Payable to CyrusOne
|
|
$
|
1.5
|
|
|
$
|
0.4
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
5.
|
Earnings Per Common Share
|
|
Year Ended December 31, 2015
|
||||||||||
(in millions, except per share amounts)
|
Continuing Operations
|
|
Discontinued Operations
|
|
Total
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
290.8
|
|
|
$
|
62.9
|
|
|
$
|
353.7
|
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
10.4
|
|
|||
Net income (loss) applicable to common shareowners - basic and diluted
|
$
|
280.4
|
|
|
$
|
62.9
|
|
|
$
|
343.3
|
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding - basic
|
209.6
|
|
|
209.6
|
|
|
209.6
|
|
|||
Stock-based compensation arrangements
|
0.6
|
|
|
0.6
|
|
|
0.6
|
|
|||
Weighted-average common shares outstanding - diluted
|
210.2
|
|
|
210.2
|
|
|
210.2
|
|
|||
Basic earnings (loss) per common share
|
$
|
1.34
|
|
|
$
|
0.30
|
|
|
$
|
1.64
|
|
Diluted earnings (loss) per common share
|
$
|
1.33
|
|
|
$
|
0.30
|
|
|
$
|
1.63
|
|
|
Year Ended December 31, 2014
|
||||||||||
(in millions, except per share amounts)
|
Continuing Operations
|
|
Discontinued Operations
|
|
Total
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
117.7
|
|
|
$
|
(42.1
|
)
|
|
$
|
75.6
|
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
10.4
|
|
|||
Net income (loss) applicable to common shareowners - basic and diluted
|
$
|
107.3
|
|
|
$
|
(42.1
|
)
|
|
$
|
65.2
|
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding - basic
|
208.5
|
|
|
208.5
|
|
|
208.5
|
|
|||
Stock-based compensation arrangements
|
1.1
|
|
|
1.1
|
|
|
1.1
|
|
|||
Weighted-average common shares outstanding - diluted
|
209.6
|
|
|
209.6
|
|
|
209.6
|
|
|||
Basic and diluted earnings (loss) per common share
|
$
|
0.51
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.31
|
|
Form 10-K Part I
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31, 2013
|
||||||||||
(in millions, except per share amounts)
|
Continuing Operations
|
|
Discontinued Operations
|
|
Total
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(64.9
|
)
|
|
$
|
10.2
|
|
|
$
|
(54.7
|
)
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
10.4
|
|
|||
Net income (loss) applicable to common shareowners - basic and diluted
|
$
|
(75.3
|
)
|
|
$
|
10.2
|
|
|
$
|
(65.1
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding - basic and diluted
|
205.9
|
|
|
205.9
|
|
|
205.9
|
|
|||
Basic and diluted earnings (loss) per common share
|
$
|
(0.37
|
)
|
|
$
|
0.05
|
|
|
$
|
(0.32
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
December 31,
|
|
Depreciable
Lives (Years)
|
||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
|||||||
Land and rights-of-way
|
$
|
4.3
|
|
|
$
|
4.3
|
|
|
20
|
-
|
Indefinite
|
Buildings and leasehold improvements
|
165.0
|
|
|
170.5
|
|
|
3
|
-
|
40
|
||
Network equipment
|
2,959.3
|
|
|
2,686.8
|
|
|
2
|
-
|
50
|
||
Office software, furniture, fixtures and vehicles
|
131.4
|
|
|
123.9
|
|
|
2
|
-
|
14
|
||
Construction in process
|
29.2
|
|
|
25.7
|
|
|
n/a
|
|
|
||
Gross value
|
3,289.2
|
|
|
3,011.2
|
|
|
|
|
|
||
Accumulated depreciation
|
(2,313.7
|
)
|
|
(2,195.8
|
)
|
|
|
|
|
||
Property, plant and equipment, net
|
$
|
975.5
|
|
|
$
|
815.4
|
|
|
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
Entertainment and Communications
|
|
IT Services and Hardware
|
|
Total
|
||||||
Balance as of December 31, 2014 and 2013
|
$
|
11.8
|
|
|
$
|
2.6
|
|
|
$
|
14.4
|
|
Disposal of asset
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||
Balance as of December 31, 2015
|
$
|
11.8
|
|
|
$
|
2.5
|
|
|
$
|
14.3
|
|
|
Weighted-
|
|
|
|
|
|
|
|
|
||||||||
|
Average
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||
|
Life in
|
|
Gross Carrying
|
|
Accumulated
|
|
Gross Carrying
|
|
Accumulated
|
||||||||
(dollars in millions)
|
Years
|
|
Amount
|
|
Amortization
|
|
Amount
|
|
Amortization
|
||||||||
Customer relationships - Entertainment and Communications
|
10
|
|
$
|
7.0
|
|
|
$
|
6.8
|
|
|
$
|
7.0
|
|
|
$
|
6.5
|
|
(dollars in millions)
|
|
||
2016
|
$
|
0.2
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
8.
|
Debt and Other Financing Arrangements
|
|
December 31,
|
||||||
(dollars in millions)
|
2015
|
|
2014
|
||||
Current portion of long-term debt:
|
|
|
|
||||
Corporate Credit Agreement - Tranche B Term Loan
|
$
|
5.4
|
|
|
$
|
5.4
|
|
Capital lease obligations and other debt
|
8.4
|
|
|
6.2
|
|
||
Current portion of long-term debt
|
13.8
|
|
|
11.6
|
|
||
Long-term debt, less current portion:
|
|
|
|
||||
Receivables Facility
|
17.6
|
|
|
19.2
|
|
||
8
3/4%
Senior Subordinated Notes due 2018
|
—
|
|
|
300.0
|
|
||
Corporate Credit Agreement - Tranche B Term Loan
|
522.5
|
|
|
527.8
|
|
||
8
3/8%
Senior Notes due 2020
|
478.5
|
|
|
661.2
|
|
||
7
1/4%
Notes due 2023
|
26.3
|
|
|
40.0
|
|
||
Various Cincinnati Bell Telephone notes
|
128.7
|
|
|
134.5
|
|
||
Capital lease obligations and other debt
|
59.9
|
|
|
9.9
|
|
||
|
1,233.5
|
|
|
1,692.6
|
|
||
Net unamortized discount
|
(1.7
|
)
|
|
(3.2
|
)
|
||
Long-term debt, less current portion
|
1,231.8
|
|
|
1,689.4
|
|
||
Total debt
|
$
|
1,245.6
|
|
|
$
|
1,701.0
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
|
|
Capital
|
|
Total
|
||||||
(dollars in millions)
|
Debt
|
|
Leases
|
|
Debt
|
||||||
Year ended December 31,
|
|
|
|
|
|
||||||
2016
|
$
|
5.9
|
|
|
$
|
7.9
|
|
|
$
|
13.8
|
|
2017
|
5.6
|
|
|
5.0
|
|
|
10.6
|
|
|||
2018
|
23.0
|
|
|
4.0
|
|
|
27.0
|
|
|||
2019
|
5.4
|
|
|
3.8
|
|
|
9.2
|
|
|||
2020
|
984.8
|
|
|
2.6
|
|
|
987.4
|
|
|||
Thereafter
|
155.0
|
|
|
44.3
|
|
|
199.3
|
|
|||
|
1,179.7
|
|
|
67.6
|
|
|
1,247.3
|
|
|||
Net unamortized discount
|
(1.7
|
)
|
|
—
|
|
|
(1.7
|
)
|
|||
Total debt
|
$
|
1,178.0
|
|
|
$
|
67.6
|
|
|
$
|
1,245.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
December 31,
|
||||||
(dollars in millions)
|
2015
|
|
2014
|
||||
Balance, beginning of period
|
$
|
1.6
|
|
|
$
|
1.7
|
|
Asset retirement obligations reclassified from discontinued operations
|
10.9
|
|
|
—
|
|
||
Liabilities settled
|
(5.0
|
)
|
|
(0.2
|
)
|
||
Revision to estimated cash flow
|
(2.9
|
)
|
|
—
|
|
||
Accretion expense
|
0.2
|
|
|
0.1
|
|
||
Balance, end of period
|
$
|
4.8
|
|
|
$
|
1.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
10.
|
Financial Instruments and Fair Value Measurements
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||
(dollars in millions)
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Investment in CyrusOne
|
$
|
55.5
|
|
|
$
|
257.9
|
|
|
$
|
273.6
|
|
|
$
|
785.0
|
|
Long-term debt, including current portion*
|
1,178.0
|
|
|
1,155.6
|
|
|
1,686.1
|
|
|
1,717.4
|
|
||||
*Excludes capital leases.
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements Using
|
|
|
||||||||||
(dollars in millions)
|
Year Ended
December 31, 2014
|
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Impairment Losses
|
||||||
Property:
|
|
|
|
|
|
|
|
|
|
||||||
Office software, furniture, fixtures, & vehicles (Entertainment and Communications)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
(4.6
|
)
|
Impairment of assets
|
|
|
|
|
|
|
|
|
$
|
(4.6
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
11.
|
Restructuring Charges
|
(dollars in millions)
|
Employee
Separation
|
|
Lease
Abandonment
|
|
Other
|
|
Total
|
||||||||
Balance as of December 31, 2012
|
$
|
6.5
|
|
|
$
|
5.2
|
|
|
$
|
0.2
|
|
|
$
|
11.9
|
|
Charges
|
9.0
|
|
|
3.9
|
|
|
0.6
|
|
|
13.5
|
|
||||
Utilizations
|
(7.1
|
)
|
|
(3.3
|
)
|
|
(0.7
|
)
|
|
(11.1
|
)
|
||||
Balance as of December 31, 2013
|
8.4
|
|
|
5.8
|
|
|
0.1
|
|
|
14.3
|
|
||||
Charges/(Reversals)
|
1.0
|
|
|
(1.4
|
)
|
|
—
|
|
|
(0.4
|
)
|
||||
Utilizations
|
(6.4
|
)
|
|
(2.6
|
)
|
|
—
|
|
|
(9.0
|
)
|
||||
Balance as of December 31, 2014
|
3.0
|
|
|
1.8
|
|
|
0.1
|
|
|
4.9
|
|
||||
Charges
|
3.3
|
|
|
0.3
|
|
|
2.4
|
|
|
6.0
|
|
||||
Utilizations
|
(6.1
|
)
|
|
(1.3
|
)
|
|
(2.4
|
)
|
|
(9.8
|
)
|
||||
Balance as of December 31, 2015
|
$
|
0.2
|
|
|
$
|
0.8
|
|
|
$
|
0.1
|
|
|
$
|
1.1
|
|
(dollars in millions)
|
Entertainment and Communications
|
|
IT Services and Hardware
|
|
Corporate
|
|
Total
|
||||||||
Balance as of December 31, 2012
|
$
|
8.6
|
|
|
$
|
0.5
|
|
|
$
|
2.8
|
|
|
$
|
11.9
|
|
Charges
|
9.1
|
|
|
0.7
|
|
|
3.7
|
|
|
13.5
|
|
||||
Utilizations
|
(7.2
|
)
|
|
(0.4
|
)
|
|
(3.5
|
)
|
|
(11.1
|
)
|
||||
Balance as of December 31, 2013
|
10.5
|
|
|
0.8
|
|
|
3.0
|
|
|
14.3
|
|
||||
Charges/(Reversals)
|
(0.5
|
)
|
|
—
|
|
|
0.1
|
|
|
(0.4
|
)
|
||||
Utilizations
|
(6.1
|
)
|
|
(0.5
|
)
|
|
(2.4
|
)
|
|
(9.0
|
)
|
||||
Balance as of December 31, 2014
|
3.9
|
|
|
0.3
|
|
|
0.7
|
|
|
4.9
|
|
||||
Charges
|
1.6
|
|
|
2.8
|
|
|
1.6
|
|
|
6.0
|
|
||||
Utilizations
|
(4.7
|
)
|
|
(2.8
|
)
|
|
(2.3
|
)
|
|
(9.8
|
)
|
||||
Balance as of December 31, 2015
|
$
|
0.8
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
1.1
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
12.
|
Pension and Postretirement Plans
|
|
Pension Benefits
|
|
Postretirement and Other Benefits
|
||||||||||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||
Service cost
|
$
|
0.3
|
|
|
$
|
1.0
|
|
|
$
|
2.1
|
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
|
$
|
0.4
|
|
Interest cost on projected benefit obligation
|
19.0
|
|
|
21.0
|
|
|
18.8
|
|
|
3.3
|
|
|
4.0
|
|
|
4.0
|
|
||||||
Expected return on plan assets
|
(29.2
|
)
|
|
(28.1
|
)
|
|
(25.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Prior service cost (benefit)
|
0.1
|
|
|
0.2
|
|
|
0.2
|
|
|
(15.4
|
)
|
|
(15.4
|
)
|
|
(14.1
|
)
|
||||||
Actuarial loss
|
24.9
|
|
|
17.3
|
|
|
22.0
|
|
|
5.4
|
|
|
5.4
|
|
|
5.6
|
|
||||||
Curtailment loss (gain)
|
0.3
|
|
|
—
|
|
|
(0.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Pension/postretirement cost (benefit)
|
$
|
15.4
|
|
|
$
|
11.4
|
|
|
$
|
16.8
|
|
|
$
|
(6.4
|
)
|
|
$
|
(5.7
|
)
|
|
$
|
(4.1
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Pension Benefits
|
|
|
Postretirement and Other Benefits
|
|
||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
|
2015
|
|
2014
|
|
2013
|
|
||||||
Discount rate
|
3.40
|
%
|
*
|
4.20
|
%
|
|
3.30
|
%
|
**
|
|
3.40
|
%
|
|
4.10
|
%
|
|
3.40
|
%
|
***
|
Expected long-term rate of return
|
7.75
|
%
|
|
7.75
|
%
|
|
7.75
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Future compensation growth rate
|
—
|
|
|
—
|
|
|
3.00
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
Postretirement and Other Benefits
|
||||||||||
|
Pension Benefits
|
|
|||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Change in benefit obligation:
|
|
|
|
|
|
|
|
||||||||
Benefit obligation at January 1,
|
$
|
577.3
|
|
|
$
|
523.0
|
|
|
$
|
109.0
|
|
|
$
|
101.5
|
|
Service cost
|
0.3
|
|
|
1.0
|
|
|
0.3
|
|
|
0.3
|
|
||||
Interest cost
|
19.0
|
|
|
21.0
|
|
|
3.3
|
|
|
4.0
|
|
||||
Actuarial (gain) loss
|
(18.8
|
)
|
|
73.5
|
|
|
(10.9
|
)
|
|
13.3
|
|
||||
Benefits paid
|
(47.3
|
)
|
|
(41.2
|
)
|
|
(12.7
|
)
|
|
(15.2
|
)
|
||||
Retiree drug subsidy received
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.5
|
|
||||
Other
|
—
|
|
|
—
|
|
|
3.9
|
|
|
4.6
|
|
||||
Benefit obligation at December 31,
|
$
|
530.5
|
|
|
$
|
577.3
|
|
|
$
|
93.1
|
|
|
$
|
109.0
|
|
|
|
|
|
|
|
|
|
||||||||
Change in plan assets:
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets at January 1,
|
$
|
424.3
|
|
|
$
|
399.3
|
|
|
$
|
11.0
|
|
|
$
|
11.3
|
|
Actual return on plan assets
|
(10.5
|
)
|
|
44.2
|
|
|
0.1
|
|
|
0.4
|
|
||||
Employer contributions
|
11.6
|
|
|
22.0
|
|
|
11.7
|
|
|
14.0
|
|
||||
Retiree drug subsidy received
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.5
|
|
||||
Benefits paid
|
(47.3
|
)
|
|
(41.2
|
)
|
|
(12.7
|
)
|
|
(15.2
|
)
|
||||
Fair value of plan assets at December 31,
|
378.1
|
|
|
424.3
|
|
|
10.3
|
|
|
11.0
|
|
||||
Unfunded status
|
$
|
(152.4
|
)
|
|
$
|
(153.0
|
)
|
|
$
|
(82.8
|
)
|
|
$
|
(98.0
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Pension Benefits
|
|
Postretirement and Other Benefits
|
||||||||
|
December 31,
|
|
December 31,
|
||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
Discount rate
|
3.80
|
%
|
|
3.40
|
%
|
|
3.70
|
%
|
|
3.40
|
%
|
Expected long-term rate of return
|
7.75
|
%
|
|
7.75
|
%
|
|
—
|
|
|
—
|
|
Future compensation growth rate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
December 31,
|
||||
|
2015
|
|
2014
|
||
Healthcare cost trend
|
6.5
|
%
|
|
6.5
|
%
|
Rate to which the cost trend is assumed to decline (ultimate trend rate)
|
4.5
|
%
|
|
4.5
|
%
|
Year the rates reach the ultimate trend rate
|
2020
|
|
|
2018
|
|
(dollars in millions)
|
1% Increase
|
|
1% Decrease
|
||||
Service and interest costs for 2015
|
$
|
0.2
|
|
|
$
|
(0.1
|
)
|
Postretirement benefit obligation at December 31, 2015
|
4.2
|
|
|
(3.8
|
)
|
|
Pension Benefits
|
|
Postretirement and Other Benefits
|
||||||||||||
|
December 31,
|
|
December 31,
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Accrued payroll and benefits (current liability)
|
$
|
2.1
|
|
|
$
|
2.2
|
|
|
$
|
10.1
|
|
|
$
|
12.0
|
|
Pension and postretirement benefit obligations (noncurrent liability)
|
150.3
|
|
|
150.8
|
|
|
72.7
|
|
|
86.0
|
|
||||
Total
|
$
|
152.4
|
|
|
$
|
153.0
|
|
|
$
|
82.8
|
|
|
$
|
98.0
|
|
|
|
|
|
|
Postretirement and Other Benefits
|
||||||||||
|
Pension Benefits
|
|
|||||||||||||
|
December 31,
|
|
December 31,
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Prior service (cost) benefit, net of tax of ($0.1), ($0.2), $15.8, $21.3
|
$
|
(0.2
|
)
|
|
$
|
(0.5
|
)
|
|
$
|
28.6
|
|
|
$
|
38.5
|
|
Actuarial loss, net of tax of ($90.4), ($91.5), ($23.0), ($29.3)
|
(157.8
|
)
|
|
(160.7
|
)
|
|
(40.9
|
)
|
|
(50.9
|
)
|
||||
Total
|
$
|
(158.0
|
)
|
|
$
|
(161.2
|
)
|
|
$
|
(12.3
|
)
|
|
$
|
(12.4
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Pension Benefits
|
|
Postretirement and Other Benefits
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Prior service cost recognized:
|
|
|
|
|
|
|
|
||||||||
Reclassification adjustments
|
$
|
0.4
|
|
|
$
|
0.2
|
|
|
$
|
(15.4
|
)
|
|
$
|
(15.4
|
)
|
Actuarial (loss) gain recognized:
|
|
|
|
|
|
|
|
||||||||
Reclassification adjustments
|
24.9
|
|
|
17.3
|
|
|
5.4
|
|
|
5.4
|
|
||||
Actuarial (loss) gain arising during the period
|
(20.9
|
)
|
|
(57.5
|
)
|
|
10.9
|
|
|
(12.9
|
)
|
|
Pension Benefits
|
|
Postretirement and Other Benefits
|
||||
(dollars in millions)
|
|
||||||
Prior service cost (benefit)
|
$
|
0.1
|
|
|
$
|
(14.8
|
)
|
Actuarial loss
|
18.2
|
|
|
4.9
|
|
||
Total
|
$
|
18.3
|
|
|
$
|
(9.9
|
)
|
(dollars in millions)
|
December 31, 2015
|
|
Quoted Prices
in active
markets
Level 1
|
|
Significant
observable
inputs
Level 2
|
|
Significant
unobservable
inputs
Level 3
|
||||||||
Mutual funds
|
|
|
|
|
|
|
|
||||||||
U.S. equity index funds
|
$
|
147.8
|
|
|
$
|
147.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
International equity index funds
|
97.0
|
|
|
97.0
|
|
|
—
|
|
|
—
|
|
||||
Fixed income bond funds
|
133.3
|
|
|
133.3
|
|
|
—
|
|
|
—
|
|
||||
Group insurance contract
|
10.3
|
|
|
—
|
|
|
—
|
|
|
10.3
|
|
||||
Total
|
$
|
388.4
|
|
|
$
|
378.1
|
|
|
$
|
—
|
|
|
$
|
10.3
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
|
December 31, 2014
|
|
Quoted Prices
in active
markets
Level 1
|
|
Significant
observable
inputs
Level 2
|
|
Significant
unobservable
inputs
Level 3
|
||||||||
Mutual funds
|
|
|
|
|
|
|
|
|
||||||||
U.S. equity index funds
|
|
$
|
212.3
|
|
|
$
|
212.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
International equity index funds
|
|
61.1
|
|
|
61.1
|
|
|
—
|
|
|
—
|
|
||||
Fixed income bond funds
|
|
150.9
|
|
|
150.9
|
|
|
—
|
|
|
—
|
|
||||
Group insurance contract
|
|
11.0
|
|
|
—
|
|
|
—
|
|
|
11.0
|
|
||||
Total
|
|
$
|
435.3
|
|
|
$
|
424.3
|
|
|
$
|
—
|
|
|
$
|
11.0
|
|
|
Pension
|
|
Postretirement and Other Benefits
|
||||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Balance, beginning of year
|
$
|
—
|
|
|
$
|
30.8
|
|
|
$
|
11.0
|
|
|
$
|
11.3
|
|
Realized gains, net
|
—
|
|
|
3.2
|
|
|
0.3
|
|
|
0.4
|
|
||||
Purchases, sales, issuances and settlements, net
|
—
|
|
|
(34.0
|
)
|
|
(1.0
|
)
|
|
(0.7
|
)
|
||||
Balance, end of year
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10.3
|
|
|
$
|
11.0
|
|
(dollars in millions)
|
Pension
Benefits
|
|
Postretirement
and Other
Benefits
|
|
Medicare
Subsidy
Receipts
|
||||||
2016
|
$
|
42.3
|
|
|
$
|
10.6
|
|
|
$
|
(0.5
|
)
|
2017
|
41.5
|
|
|
9.8
|
|
|
(0.5
|
)
|
|||
2018
|
41.2
|
|
|
9.2
|
|
|
(0.5
|
)
|
|||
2019
|
39.4
|
|
|
7.9
|
|
|
(0.5
|
)
|
|||
2020
|
38.8
|
|
|
7.1
|
|
|
(0.4
|
)
|
|||
Years 2021 - 2025
|
174.9
|
|
|
30.8
|
|
|
(1.7
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(dollars in millions)
|
Unrecognized Net Periodic Pension and Postretirement Benefit Cost
|
|
Foreign Currency Translation Loss
|
|
Total
|
||||||
Balance as of December 31, 2013
|
$
|
(133.1
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
(133.3
|
)
|
Foreign currency loss
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||
Remeasurement of benefit obligations
|
(45.4
|
)
|
|
—
|
|
|
(45.4
|
)
|
|||
Reclassifications, net (a)
|
4.9
|
|
|
—
|
|
|
4.9
|
|
|||
Balance as of December 31, 2014
|
(173.6
|
)
|
|
(0.3
|
)
|
|
(173.9
|
)
|
|||
Foreign currency loss
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
|||
Remeasurement of benefit obligations
|
(6.6
|
)
|
|
—
|
|
|
(6.6
|
)
|
|||
Reclassifications, net (a)
|
9.9
|
|
|
—
|
|
|
9.9
|
|
|||
Balance as of December 31, 2015
|
$
|
(170.3
|
)
|
|
$
|
(0.7
|
)
|
|
$
|
(171.0
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
9.2
|
|
|
$
|
9.3
|
|
|
$
|
—
|
|
State and local
|
1.7
|
|
|
1.9
|
|
|
—
|
|
|||
Total current
|
10.9
|
|
|
11.2
|
|
|
—
|
|
|||
Investment tax credits
|
(0.2
|
)
|
|
(0.2
|
)
|
|
(0.2
|
)
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
149.4
|
|
|
69.6
|
|
|
(18.5
|
)
|
|||
State and local
|
5.2
|
|
|
1.9
|
|
|
(4.0
|
)
|
|||
Foreign
|
—
|
|
|
—
|
|
|
0.3
|
|
|||
Total deferred
|
154.6
|
|
|
71.5
|
|
|
(22.2
|
)
|
|||
Valuation allowance
|
(5.5
|
)
|
|
(1.1
|
)
|
|
14.1
|
|
|||
Total
|
$
|
159.8
|
|
|
$
|
81.4
|
|
|
$
|
(8.3
|
)
|
|
Year Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
U.S. federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State and local income taxes, net of federal income tax
|
0.7
|
|
|
0.8
|
|
|
1.5
|
|
Change in valuation allowance, net of federal income tax
|
(0.8
|
)
|
|
(2.0
|
)
|
|
(12.4
|
)
|
State net operating loss adjustments
|
0.3
|
|
|
1.9
|
|
|
2.1
|
|
Nondeductible interest expense
|
—
|
|
|
2.7
|
|
|
(8.9
|
)
|
Unrecognized tax benefit changes
|
0.2
|
|
|
1.4
|
|
|
(1.7
|
)
|
Nondeductible compensation
|
0.1
|
|
|
0.7
|
|
|
(2.0
|
)
|
Foreign
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
Other differences, net
|
—
|
|
|
0.4
|
|
|
(1.7
|
)
|
Effective tax rate
|
35.5
|
%
|
|
40.9
|
%
|
|
11.4
|
%
|
|
Year Ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Income tax (benefit) provision related to:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
159.8
|
|
|
$
|
81.4
|
|
|
$
|
(8.3
|
)
|
Discontinued operations
|
34.8
|
|
|
(24.0
|
)
|
|
5.8
|
|
|||
Accumulated other comprehensive income (loss)
|
2.0
|
|
|
(22.4
|
)
|
|
42.1
|
|
|||
Excess tax benefits on stock option exercises
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.5
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
December 31,
|
||||||
(dollars in millions)
|
2015
|
|
2014
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
142.0
|
|
|
$
|
286.5
|
|
Pension and postretirement benefits
|
89.1
|
|
|
95.5
|
|
||
Investment in CyrusOne
|
68.9
|
|
|
64.5
|
|
||
Deferred gain on sale of wireless spectrum licenses
|
—
|
|
|
42.2
|
|
||
AMT Credit Carryforward
|
32.7
|
|
|
24.7
|
|
||
Other
|
43.8
|
|
|
47.4
|
|
||
Total deferred tax assets
|
376.5
|
|
|
560.8
|
|
||
Valuation allowance
|
(58.4
|
)
|
|
(64.4
|
)
|
||
Total deferred tax assets, net of valuation allowance
|
$
|
318.1
|
|
|
$
|
496.4
|
|
Deferred tax liabilities:
|
|
|
|
||||
Property, plant and equipment
|
$
|
134.9
|
|
|
$
|
121.9
|
|
Other
|
0.3
|
|
|
4.9
|
|
||
Total deferred tax liabilities
|
135.2
|
|
|
126.8
|
|
||
Net deferred tax assets
|
$
|
182.9
|
|
|
$
|
369.6
|
|
|
Year Ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Balance, beginning of year
|
$
|
27.1
|
|
|
$
|
24.1
|
|
|
$
|
22.8
|
|
Change in tax positions for the current year
|
0.5
|
|
|
3.0
|
|
|
1.3
|
|
|||
Change in tax positions for prior years
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance, end of year
|
$
|
27.6
|
|
|
$
|
27.1
|
|
|
$
|
24.1
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Outstanding
|
|
Exercisable
|
||||||||||
|
|
|
Weighted-
Average
Exercise
Price Per
Share
|
|
|
|
Weighted-
Average
Exercise
Price Per
Share
|
||||||
(in thousands, except per share amounts)
|
Shares
|
|
|
Shares
|
|
||||||||
$1.67 to $2.91
|
564
|
|
|
$
|
2.49
|
|
|
564
|
|
|
$
|
2.49
|
|
$3.40 to $4.62
|
1,788
|
|
|
3.46
|
|
|
1,146
|
|
|
3.49
|
|
||
$4.74 to $5.31
|
1,528
|
|
|
4.82
|
|
|
1,465
|
|
|
4.83
|
|
||
Total
|
3,880
|
|
|
$
|
3.86
|
|
|
3,175
|
|
|
$
|
3.93
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
2015
|
2014
|
2013
|
||||||
Expected volatility
|
—
|
|
35.5
|
%
|
43.6
|
%
|
|||
Risk-free interest rate
|
—
|
|
1.5
|
%
|
0.8
|
%
|
|||
Expected holding period (in years)
|
—
|
|
5
|
|
5
|
|
|||
Expected dividends
|
—
|
|
0.0
|
%
|
0.0
|
%
|
|||
Weighted-average grant date fair value
|
$
|
—
|
|
$
|
1.14
|
|
$
|
1.84
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||||||||
|
|
|
Weighted-
Average
Exercise
Price Per
Share
|
|
|
|
Weighted-
Average
Exercise
Price Per
Share
|
|
|
|
Weighted-
Average
Exercise
Price Per
Share
|
||||||||||||
(in thousands, except per share amounts)
|
Shares
|
|
|
Shares
|
|
|
Shares
|
|
|||||||||||||||
Non-vested at January 1,
|
684
|
|
|
$
|
3.70
|
|
|
1,044
|
|
|
$
|
3.55
|
|
|
1,298
|
|
|
$
|
3.11
|
|
|||
Granted
|
180
|
|
|
3.47
|
|
|
176
|
|
|
3.19
|
|
|
279
|
|
|
4.72
|
|
||||||
Vested
|
(630
|
)
|
|
3.54
|
|
|
(514
|
)
|
|
3.25
|
|
|
(454
|
)
|
|
3.03
|
|
||||||
Forfeited
|
—
|
|
|
—
|
|
|
(22
|
)
|
|
3.19
|
|
|
(79
|
)
|
|
3.40
|
|
||||||
Non-vested at December 31,
|
234
|
|
|
$
|
3.96
|
|
|
684
|
|
|
$
|
3.70
|
|
|
1,044
|
|
|
$
|
3.55
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Compensation expense for the year
|
$
|
1.0
|
|
|
|
|
$
|
1.6
|
|
|
|
|
$
|
1.7
|
|
|
|
||||||
Tax benefit related to compensation expense
|
$
|
(0.3
|
)
|
|
|
|
$
|
(0.6
|
)
|
|
|
|
$
|
(0.6
|
)
|
|
|
||||||
Grant date fair value of awards vested
|
$
|
2.2
|
|
|
|
|
$
|
1.7
|
|
|
|
|
$
|
1.4
|
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
16.
|
Business Segment Information
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Revenue
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
743.7
|
|
|
$
|
740.7
|
|
|
$
|
724.8
|
|
IT Services and Hardware
|
435.4
|
|
|
433.0
|
|
|
344.1
|
|
|||
Data Center Colocation
|
—
|
|
|
—
|
|
|
15.6
|
|
|||
Intersegment
|
(11.3
|
)
|
|
(12.2
|
)
|
|
(11.1
|
)
|
|||
Total revenue
|
$
|
1,167.8
|
|
|
$
|
1,161.5
|
|
|
$
|
1,073.4
|
|
Intersegment revenue
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
1.3
|
|
|
$
|
1.2
|
|
|
$
|
1.1
|
|
IT Services and Hardware
|
10.0
|
|
|
11.0
|
|
|
9.6
|
|
|||
Data Center Colocation
|
—
|
|
|
—
|
|
|
0.4
|
|
|||
Total intersegment revenue
|
$
|
11.3
|
|
|
$
|
12.2
|
|
|
$
|
11.1
|
|
Operating income
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
129.9
|
|
|
$
|
178.9
|
|
|
$
|
186.2
|
|
IT Services and Hardware
|
20.6
|
|
|
19.8
|
|
|
8.5
|
|
|||
Data Center Colocation
|
—
|
|
|
—
|
|
|
3.2
|
|
|||
Corporate
|
(22.5
|
)
|
|
(21.8
|
)
|
|
(58.1
|
)
|
|||
Total operating income
|
$
|
128.0
|
|
|
$
|
176.9
|
|
|
$
|
139.8
|
|
Expenditures for long-lived assets
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
269.5
|
|
|
$
|
163.7
|
|
|
$
|
162.6
|
|
IT Services and Hardware
|
14.0
|
|
|
11.9
|
|
|
10.6
|
|
|||
Data Center Colocation
|
—
|
|
|
—
|
|
|
7.7
|
|
|||
Corporate
|
0.1
|
|
|
0.2
|
|
|
—
|
|
|||
Total expenditures for long-lived assets
|
$
|
283.6
|
|
|
$
|
175.8
|
|
|
$
|
180.9
|
|
Depreciation and amortization
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
129.2
|
|
|
$
|
115.7
|
|
|
$
|
112.2
|
|
IT Services and Hardware
|
12.3
|
|
|
11.7
|
|
|
10.5
|
|
|||
Data Center Colocation
|
—
|
|
|
—
|
|
|
5.2
|
|
|||
Corporate
|
0.1
|
|
|
0.2
|
|
|
0.5
|
|
|||
Total depreciation and amortization
|
$
|
141.6
|
|
|
$
|
127.6
|
|
|
$
|
128.4
|
|
|
|
|
|
|
|
||||||
|
As of December 31,
|
|
|
||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
|
||||||
Assets
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
983.3
|
|
|
$
|
833.2
|
|
|
|
||
IT Services and Hardware
|
58.0
|
|
|
61.4
|
|
|
|
||||
Total assets from discontinued operations
|
—
|
|
|
49.3
|
|
|
|
||||
Corporate and eliminations
|
413.1
|
|
|
876.8
|
|
|
|
||||
Total assets
|
$
|
1,454.4
|
|
|
$
|
1,820.7
|
|
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Service revenue
|
|
|
|
|
|
||||||
Entertainment and Communications
|
$
|
735.0
|
|
|
$
|
728.8
|
|
|
$
|
718.0
|
|
IT Services and Hardware
|
198.0
|
|
|
161.4
|
|
|
138.7
|
|
|||
Data Center Colocation
|
—
|
|
|
—
|
|
|
15.2
|
|
|||
Total service revenue
|
$
|
933.0
|
|
|
$
|
890.2
|
|
|
$
|
871.9
|
|
Product revenue
|
|
|
|
|
|
||||||
Handsets and accessories
|
$
|
7.4
|
|
|
$
|
10.7
|
|
|
$
|
5.7
|
|
Telecom and IT hardware
|
227.4
|
|
|
260.6
|
|
|
195.8
|
|
|||
Total product revenue
|
$
|
234.8
|
|
|
$
|
271.3
|
|
|
$
|
201.5
|
|
|
Year Ended December 31,
|
||||||||||
(dollars in millions)
|
2015
|
|
2014
|
|
2013
|
||||||
Capitalized interest expense
|
$
|
1.1
|
|
|
$
|
0.8
|
|
|
$
|
0.6
|
|
Cash paid for:
|
|
|
|
|
|
||||||
Interest
|
108.5
|
|
|
153.1
|
|
|
179.5
|
|
|||
Income taxes, net of refunds
|
8.8
|
|
|
9.1
|
|
|
2.8
|
|
|||
Noncash investing and financing activities:
|
|
|
|
|
|
||||||
Investment in CyrusOne resulting from deconsolidation
|
—
|
|
|
—
|
|
|
509.7
|
|
|||
Accrual of CyrusOne dividends
|
2.1
|
|
|
6.0
|
|
|
7.1
|
|
|||
Acquisition of property by assuming debt and other financing arrangements
|
5.8
|
|
|
4.7
|
|
|
7.6
|
|
|||
Acquisition of property on account
|
34.6
|
|
|
24.8
|
|
|
13.3
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
18.
|
Supplemental Guarantor Information - Cincinnati Bell Telephone Notes
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)
|
|||||||||||||||||||
|
Year Ended December 31, 2015
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor)
|
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
660.1
|
|
|
$
|
546.3
|
|
|
$
|
(38.6
|
)
|
|
$
|
1,167.8
|
|
Operating costs and expenses
|
22.4
|
|
|
538.6
|
|
|
517.4
|
|
|
(38.6
|
)
|
|
1,039.8
|
|
|||||
Operating income (loss)
|
(22.4
|
)
|
|
121.5
|
|
|
28.9
|
|
|
—
|
|
|
128.0
|
|
|||||
Interest expense (income), net
|
112.7
|
|
|
(0.9
|
)
|
|
(8.7
|
)
|
|
—
|
|
|
103.1
|
|
|||||
Other expense (income), net
|
19.5
|
|
|
7.0
|
|
|
(452.2
|
)
|
|
—
|
|
|
(425.7
|
)
|
|||||
Income (loss) before equity in earnings of subsidiaries and income taxes
|
(154.6
|
)
|
|
115.4
|
|
|
489.8
|
|
|
—
|
|
|
450.6
|
|
|||||
Income tax expense (benefit)
|
(53.3
|
)
|
|
41.1
|
|
|
172.0
|
|
|
—
|
|
|
159.8
|
|
|||||
Equity in earnings of subsidiaries, net of tax
|
455.0
|
|
|
—
|
|
|
—
|
|
|
(455.0
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
353.7
|
|
|
74.3
|
|
|
317.8
|
|
|
(455.0
|
)
|
|
290.8
|
|
|||||
Income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
62.9
|
|
|
—
|
|
|
62.9
|
|
|||||
Net income (loss)
|
353.7
|
|
|
74.3
|
|
|
380.7
|
|
|
(455.0
|
)
|
|
353.7
|
|
|||||
Other comprehensive income (loss)
|
3.3
|
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
2.9
|
|
|||||
Total comprehensive income (loss)
|
$
|
357.0
|
|
|
$
|
74.3
|
|
|
$
|
380.3
|
|
|
$
|
(455.0
|
)
|
|
$
|
356.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
353.7
|
|
|
$
|
74.3
|
|
|
$
|
380.7
|
|
|
$
|
(455.0
|
)
|
|
$
|
353.7
|
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net income (loss) applicable to common shareowners
|
$
|
343.3
|
|
|
$
|
74.3
|
|
|
$
|
380.7
|
|
|
$
|
(455.0
|
)
|
|
$
|
343.3
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year Ended December 31, 2014
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor)
|
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
659.6
|
|
|
$
|
541.0
|
|
|
$
|
(39.1
|
)
|
|
$
|
1,161.5
|
|
Operating costs and expenses
|
21.5
|
|
|
488.0
|
|
|
514.2
|
|
|
(39.1
|
)
|
|
984.6
|
|
|||||
Operating income (loss)
|
(21.5
|
)
|
|
171.6
|
|
|
26.8
|
|
|
—
|
|
|
176.9
|
|
|||||
Interest expense (income), net
|
142.6
|
|
|
(4.5
|
)
|
|
7.8
|
|
|
—
|
|
|
145.9
|
|
|||||
Other expense (income), net
|
17.6
|
|
|
7.4
|
|
|
(193.1
|
)
|
|
—
|
|
|
(168.1
|
)
|
|||||
Income (loss) before equity in earnings of subsidiaries and income taxes
|
(181.7
|
)
|
|
168.7
|
|
|
212.1
|
|
|
—
|
|
|
199.1
|
|
|||||
Income tax expense (benefit)
|
(55.8
|
)
|
|
61.7
|
|
|
75.5
|
|
|
—
|
|
|
81.4
|
|
|||||
Equity in earnings of subsidiaries, net of tax
|
201.5
|
|
|
—
|
|
|
—
|
|
|
(201.5
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
75.6
|
|
|
107.0
|
|
|
136.6
|
|
|
(201.5
|
)
|
|
117.7
|
|
|||||
Income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
(42.1
|
)
|
|
—
|
|
|
(42.1
|
)
|
|||||
Net income (loss)
|
75.6
|
|
|
107.0
|
|
|
94.5
|
|
|
(201.5
|
)
|
|
75.6
|
|
|||||
Other comprehensive income (loss)
|
(40.5
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
(40.6
|
)
|
|||||
Total comprehensive income (loss)
|
$
|
35.1
|
|
|
$
|
107.0
|
|
|
$
|
94.4
|
|
|
$
|
(201.5
|
)
|
|
$
|
35.0
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
75.6
|
|
|
$
|
107.0
|
|
|
$
|
94.5
|
|
|
$
|
(201.5
|
)
|
|
$
|
75.6
|
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net income (loss) applicable to common shareowners
|
$
|
65.2
|
|
|
$
|
107.0
|
|
|
$
|
94.5
|
|
|
$
|
(201.5
|
)
|
|
$
|
65.2
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)
|
|||||||||||||||||||
|
Year Ended December 31, 2013
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor) |
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
644.2
|
|
|
$
|
467.5
|
|
|
$
|
(38.3
|
)
|
|
$
|
1,073.4
|
|
Operating costs and expenses
|
57.2
|
|
|
463.1
|
|
|
451.6
|
|
|
(38.3
|
)
|
|
933.6
|
|
|||||
Operating income (loss)
|
(57.2
|
)
|
|
181.1
|
|
|
15.9
|
|
|
—
|
|
|
139.8
|
|
|||||
Interest expense (income), net
|
162.5
|
|
|
(2.7
|
)
|
|
16.2
|
|
|
—
|
|
|
176.0
|
|
|||||
Other expense (income), net
|
28.2
|
|
|
6.5
|
|
|
2.3
|
|
|
—
|
|
|
37.0
|
|
|||||
Income (loss) before equity in earnings of subsidiaries and income taxes
|
(247.9
|
)
|
|
177.3
|
|
|
(2.6
|
)
|
|
—
|
|
|
(73.2
|
)
|
|||||
Income tax expense (benefit)
|
(79.8
|
)
|
|
64.7
|
|
|
6.8
|
|
|
—
|
|
|
(8.3
|
)
|
|||||
Equity in earnings of subsidiaries, net of tax
|
113.4
|
|
|
—
|
|
|
—
|
|
|
(113.4
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
(54.7
|
)
|
|
112.6
|
|
|
(9.4
|
)
|
|
(113.4
|
)
|
|
(64.9
|
)
|
|||||
Income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
10.2
|
|
|
—
|
|
|
10.2
|
|
|||||
Net income (loss)
|
(54.7
|
)
|
|
112.6
|
|
|
0.8
|
|
|
(113.4
|
)
|
|
(54.7
|
)
|
|||||
Other comprehensive income (loss)
|
76.5
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
76.4
|
|
|||||
Total comprehensive income (loss)
|
$
|
21.8
|
|
|
$
|
112.6
|
|
|
$
|
0.7
|
|
|
$
|
(113.4
|
)
|
|
$
|
21.7
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
(54.7
|
)
|
|
$
|
112.6
|
|
|
$
|
0.8
|
|
|
$
|
(113.4
|
)
|
|
$
|
(54.7
|
)
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net income (loss) applicable to common shareowners
|
$
|
(65.1
|
)
|
|
$
|
112.6
|
|
|
$
|
0.8
|
|
|
$
|
(113.4
|
)
|
|
$
|
(65.1
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Balance Sheets
|
|
|
|
|
|
|
|
|
|
||||||||||
|
As of December 31, 2015
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor)
|
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash and cash equivalents
|
$
|
4.6
|
|
|
$
|
1.0
|
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
Receivables, net
|
0.7
|
|
|
—
|
|
|
156.4
|
|
|
—
|
|
|
157.1
|
|
|||||
Other current assets
|
1.6
|
|
|
20.2
|
|
|
14.1
|
|
|
—
|
|
|
35.9
|
|
|||||
Total current assets
|
6.9
|
|
|
21.2
|
|
|
172.3
|
|
|
—
|
|
|
200.4
|
|
|||||
Property, plant and equipment, net
|
0.3
|
|
|
921.5
|
|
|
53.7
|
|
|
—
|
|
|
975.5
|
|
|||||
Investment in CyrusOne
|
—
|
|
|
—
|
|
|
55.5
|
|
|
—
|
|
|
55.5
|
|
|||||
Goodwill and intangibles, net
|
—
|
|
|
2.2
|
|
|
12.3
|
|
|
—
|
|
|
14.5
|
|
|||||
Investments in and advances to subsidiaries
|
844.6
|
|
|
63.9
|
|
|
647.2
|
|
|
(1,555.7
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
214.4
|
|
|
3.8
|
|
|
136.6
|
|
|
(146.3
|
)
|
|
208.5
|
|
|||||
Total assets
|
$
|
1,066.2
|
|
|
$
|
1,012.6
|
|
|
$
|
1,077.6
|
|
|
$
|
(1,702.0
|
)
|
|
$
|
1,454.4
|
|
Current portion of long-term debt
|
$
|
5.4
|
|
|
$
|
5.0
|
|
|
$
|
3.4
|
|
|
$
|
—
|
|
|
$
|
13.8
|
|
Accounts payable
|
0.7
|
|
|
84.8
|
|
|
43.4
|
|
|
—
|
|
|
128.9
|
|
|||||
Other current liabilities
|
41.6
|
|
|
45.3
|
|
|
24.2
|
|
|
—
|
|
|
111.1
|
|
|||||
Other current liabilities from discontinued operations
|
—
|
|
|
—
|
|
|
5.4
|
|
|
—
|
|
|
5.4
|
|
|||||
Total current liabilities
|
47.7
|
|
|
135.1
|
|
|
76.4
|
|
|
—
|
|
|
259.2
|
|
|||||
Long-term debt, less current portion
|
1,025.8
|
|
|
135.1
|
|
|
70.9
|
|
|
—
|
|
|
1,231.8
|
|
|||||
Other noncurrent liabilities
|
235.5
|
|
|
168.3
|
|
|
4.0
|
|
|
(146.2
|
)
|
|
261.6
|
|
|||||
Intercompany payables
|
54.7
|
|
|
—
|
|
|
—
|
|
|
(54.7
|
)
|
|
—
|
|
|||||
Total liabilities
|
1,363.7
|
|
|
438.5
|
|
|
151.3
|
|
|
(200.9
|
)
|
|
1,752.6
|
|
|||||
Shareowners’ (deficit) equity
|
(297.5
|
)
|
|
574.1
|
|
|
926.3
|
|
|
(1,501.1
|
)
|
|
(298.2
|
)
|
|||||
Total liabilities and shareowners’ equity (deficit)
|
$
|
1,066.2
|
|
|
$
|
1,012.6
|
|
|
$
|
1,077.6
|
|
|
$
|
(1,702.0
|
)
|
|
$
|
1,454.4
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Balance Sheets
|
|||||||||||||||||||
|
As of December 31, 2014
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor) |
|
CBT
(Issuer) |
|
Other
Non-guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Cash and cash equivalents
|
$
|
56.2
|
|
|
$
|
1.0
|
|
|
$
|
0.7
|
|
|
$
|
—
|
|
|
$
|
57.9
|
|
Receivables, net
|
2.6
|
|
|
1.0
|
|
|
164.9
|
|
|
—
|
|
|
168.5
|
|
|||||
Other current assets
|
1.3
|
|
|
16.3
|
|
|
20.0
|
|
|
—
|
|
|
37.6
|
|
|||||
Other current assets from discontinued operations
|
—
|
|
|
—
|
|
|
4.7
|
|
|
—
|
|
|
4.7
|
|
|||||
Total current assets
|
60.1
|
|
|
18.3
|
|
|
190.3
|
|
|
—
|
|
|
268.7
|
|
|||||
Property, plant and equipment, net
|
0.2
|
|
|
764.0
|
|
|
51.2
|
|
|
—
|
|
|
815.4
|
|
|||||
Investment in CyrusOne
|
—
|
|
|
—
|
|
|
273.6
|
|
|
—
|
|
|
273.6
|
|
|||||
Goodwill and intangibles, net
|
—
|
|
|
2.2
|
|
|
12.7
|
|
|
—
|
|
|
14.9
|
|
|||||
Investments in and advances to subsidiaries
|
1,066.1
|
|
|
220.8
|
|
|
260.5
|
|
|
(1,547.4
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
297.6
|
|
|
4.9
|
|
|
244.2
|
|
|
(143.2
|
)
|
|
403.5
|
|
|||||
Other noncurrent assets from discontinued operations
|
—
|
|
|
—
|
|
|
44.6
|
|
|
—
|
|
|
44.6
|
|
|||||
Total assets
|
$
|
1,424.0
|
|
|
$
|
1,010.2
|
|
|
$
|
1,077.1
|
|
|
$
|
(1,690.6
|
)
|
|
$
|
1,820.7
|
|
Current portion of long-term debt
|
$
|
5.4
|
|
|
$
|
3.9
|
|
|
$
|
2.3
|
|
|
$
|
—
|
|
|
$
|
11.6
|
|
Accounts payable
|
1.0
|
|
|
73.8
|
|
|
57.2
|
|
|
—
|
|
|
132.0
|
|
|||||
Other current liabilities
|
52.3
|
|
|
52.8
|
|
|
20.0
|
|
|
0.1
|
|
|
125.2
|
|
|||||
Other current liabilities from discontinued operations
|
—
|
|
|
—
|
|
|
142.0
|
|
|
—
|
|
|
142.0
|
|
|||||
Total current liabilities
|
58.7
|
|
|
130.5
|
|
|
221.5
|
|
|
0.1
|
|
|
410.8
|
|
|||||
Long-term debt, less current portion
|
1,526.1
|
|
|
141.2
|
|
|
22.1
|
|
|
—
|
|
|
1,689.4
|
|
|||||
Other noncurrent liabilities
|
254.1
|
|
|
153.7
|
|
|
1.9
|
|
|
(143.4
|
)
|
|
266.3
|
|
|||||
Other noncurrent liabilities from discontinued operations
|
—
|
|
|
—
|
|
|
102.7
|
|
|
—
|
|
|
102.7
|
|
|||||
Intercompany payables
|
233.4
|
|
|
—
|
|
|
—
|
|
|
(233.4
|
)
|
|
—
|
|
|||||
Total liabilities
|
2,072.3
|
|
|
425.4
|
|
|
348.2
|
|
|
(376.7
|
)
|
|
2,469.2
|
|
|||||
Shareowners’ (deficit) equity
|
(648.3
|
)
|
|
584.8
|
|
|
728.9
|
|
|
(1,313.9
|
)
|
|
(648.5
|
)
|
|||||
Total liabilities and shareowners’ equity (deficit)
|
$
|
1,424.0
|
|
|
$
|
1,010.2
|
|
|
$
|
1,077.1
|
|
|
$
|
(1,690.6
|
)
|
|
$
|
1,820.7
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31, 2015
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor)
|
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash flows provided by (used in) by operating activities
|
$
|
(19.3
|
)
|
|
$
|
198.7
|
|
|
$
|
(68.5
|
)
|
|
$
|
—
|
|
|
$
|
110.9
|
|
Capital expenditures
|
(0.1
|
)
|
|
(260.7
|
)
|
|
(22.8
|
)
|
|
—
|
|
|
(283.6
|
)
|
|||||
Proceeds received from sale of CyrusOne
|
—
|
|
|
—
|
|
|
643.9
|
|
|
—
|
|
|
643.9
|
|
|||||
Dividends received from CyrusOne
|
—
|
|
|
—
|
|
|
22.2
|
|
|
—
|
|
|
22.2
|
|
|||||
Proceeds from sale of assets
|
—
|
|
|
0.1
|
|
|
0.9
|
|
|
—
|
|
|
1.0
|
|
|||||
Distributions received from subsidiaries
|
11.3
|
|
|
—
|
|
|
—
|
|
|
(11.3
|
)
|
|
—
|
|
|||||
Funding between Parent and subsidiaries, net
|
—
|
|
|
71.9
|
|
|
(555.5
|
)
|
|
483.6
|
|
|
—
|
|
|||||
Other investing activities
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|||||
Cash flows provided by (used in) investing activities
|
10.9
|
|
|
(188.7
|
)
|
|
88.7
|
|
|
472.3
|
|
|
383.2
|
|
|||||
Funding between Parent and subsidiaries, net
|
486.4
|
|
|
—
|
|
|
(2.8
|
)
|
|
(483.6
|
)
|
|
—
|
|
|||||
Distributions paid to Parent
|
—
|
|
|
—
|
|
|
(11.3
|
)
|
|
11.3
|
|
|
—
|
|
|||||
Net decrease in corporate credit and receivables facilities with initial maturities less than 90 days
|
—
|
|
|
—
|
|
|
(1.6
|
)
|
|
—
|
|
|
(1.6
|
)
|
|||||
Repayment of debt
|
(518.5
|
)
|
|
(10.0
|
)
|
|
(3.2
|
)
|
|
—
|
|
|
(531.7
|
)
|
|||||
Debt issuance costs
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.4
|
)
|
|||||
Other financing activities
|
(10.9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.9
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
(43.2
|
)
|
|
(10.0
|
)
|
|
(19.1
|
)
|
|
(472.3
|
)
|
|
(544.6
|
)
|
|||||
Increase (decrease) in cash and cash equivalents
|
(51.6
|
)
|
|
—
|
|
|
1.1
|
|
|
—
|
|
|
(50.5
|
)
|
|||||
Beginning cash and cash equivalents
|
56.2
|
|
|
1.0
|
|
|
0.7
|
|
|
—
|
|
|
57.9
|
|
|||||
Ending cash and cash equivalents
|
$
|
4.6
|
|
|
$
|
1.0
|
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year Ended December 31, 2014
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor)
|
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash flows provided by (used in) operating activities
|
$
|
(56.3
|
)
|
|
$
|
226.3
|
|
|
$
|
5.2
|
|
|
$
|
—
|
|
|
$
|
175.2
|
|
Capital expenditures
|
(0.2
|
)
|
|
(152.5
|
)
|
|
(29.6
|
)
|
|
—
|
|
|
(182.3
|
)
|
|||||
Proceeds from sale of CyrusOne
|
—
|
|
|
—
|
|
|
355.9
|
|
|
—
|
|
|
355.9
|
|
|||||
Dividends received from CyrusOne
|
—
|
|
|
—
|
|
|
28.4
|
|
|
—
|
|
|
28.4
|
|
|||||
Proceeds from sale of assets
|
—
|
|
|
0.3
|
|
|
196.1
|
|
|
—
|
|
|
196.4
|
|
|||||
Distributions received from subsidiaries
|
12.8
|
|
|
—
|
|
|
—
|
|
|
(12.8
|
)
|
|
—
|
|
|||||
Funding between Parent and subsidiaries, net
|
—
|
|
|
(71.0
|
)
|
|
(545.0
|
)
|
|
616.0
|
|
|
—
|
|
|||||
Other investing activities
|
(0.3
|
)
|
|
—
|
|
|
(5.5
|
)
|
|
—
|
|
|
(5.8
|
)
|
|||||
Cash flows provided by (used in) investing activities
|
12.3
|
|
|
(223.2
|
)
|
|
0.3
|
|
|
603.2
|
|
|
392.6
|
|
|||||
Funding between Parent and subsidiaries, net
|
516.2
|
|
|
—
|
|
|
99.8
|
|
|
(616.0
|
)
|
|
—
|
|
|||||
Distributions paid to Parent
|
—
|
|
|
—
|
|
|
(12.8
|
)
|
|
12.8
|
|
|
—
|
|
|||||
Net increase in corporate credit and receivables facilities with initial maturities less than 90 days
|
(40.0
|
)
|
|
—
|
|
|
(87.0
|
)
|
|
—
|
|
|
(127.0
|
)
|
|||||
Repayment of debt
|
(367.3
|
)
|
|
(3.9
|
)
|
|
(5.3
|
)
|
|
—
|
|
|
(376.5
|
)
|
|||||
Debt issuance costs
|
(0.7
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.9
|
)
|
|||||
Proceeds from exercise of options and warrants
|
1.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.3
|
|
|||||
Other financing activities
|
(11.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11.4
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
98.1
|
|
|
(3.9
|
)
|
|
(5.5
|
)
|
|
(603.2
|
)
|
|
(514.5
|
)
|
|||||
Increase (decrease) in cash and cash equivalents
|
54.1
|
|
|
(0.8
|
)
|
|
—
|
|
|
—
|
|
|
53.3
|
|
|||||
Beginning cash and cash equivalents
|
2.1
|
|
|
1.8
|
|
|
0.7
|
|
|
—
|
|
|
4.6
|
|
|||||
Ending cash and cash equivalents
|
$
|
56.2
|
|
|
$
|
1.0
|
|
|
$
|
0.7
|
|
|
$
|
—
|
|
|
$
|
57.9
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31, 2013
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Guarantor)
|
|
CBT
(Issuer)
|
|
Other
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash flows provided by (used in) operating activities
|
$
|
(218.1
|
)
|
|
$
|
236.4
|
|
|
$
|
60.5
|
|
|
$
|
—
|
|
|
$
|
78.8
|
|
Capital expenditures
|
—
|
|
|
(153.1
|
)
|
|
(43.8
|
)
|
|
—
|
|
|
(196.9
|
)
|
|||||
Dividends received from CyrusOne
|
—
|
|
|
—
|
|
|
21.3
|
|
|
—
|
|
|
21.3
|
|
|||||
Proceeds from sale of assets
|
—
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|
2.0
|
|
|||||
Cash divested from deconsolidation of CyrusOne
|
—
|
|
|
—
|
|
|
(12.2
|
)
|
|
—
|
|
|
(12.2
|
)
|
|||||
Other investing activities
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
|||||
Cash flows provided by (used in) investing activities
|
—
|
|
|
(151.1
|
)
|
|
(34.3
|
)
|
|
—
|
|
|
(185.4
|
)
|
|||||
Issuance of long-term debt
|
536.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
536.0
|
|
|||||
Funding between Parent and subsidiaries, net
|
174.2
|
|
|
(81.7
|
)
|
|
(92.5
|
)
|
|
—
|
|
|
—
|
|
|||||
Net increase in corporate credit and receivables facilities with initial maturities less than 90 days
|
40.0
|
|
|
—
|
|
|
54.2
|
|
|
—
|
|
|
94.2
|
|
|||||
Repayment of debt
|
(522.0
|
)
|
|
(3.7
|
)
|
|
(5.1
|
)
|
|
—
|
|
|
(530.8
|
)
|
|||||
Debt issuance costs
|
(6.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.7
|
)
|
|||||
Proceeds from exercise of options and warrants
|
7.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7.1
|
|
|||||
Other financing activities
|
(12.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12.2
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
216.4
|
|
|
(85.4
|
)
|
|
(43.4
|
)
|
|
—
|
|
|
87.6
|
|
|||||
Increase (decrease) in cash and cash equivalents
|
(1.7
|
)
|
|
(0.1
|
)
|
|
(17.2
|
)
|
|
—
|
|
|
(19.0
|
)
|
|||||
Beginning cash and cash equivalents
|
3.8
|
|
|
1.9
|
|
|
17.9
|
|
|
—
|
|
|
23.6
|
|
|||||
Ending cash and cash equivalents
|
$
|
2.1
|
|
|
$
|
1.8
|
|
|
$
|
0.7
|
|
|
$
|
—
|
|
|
$
|
4.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
19.
|
Supplemental Guarantor Information - 8
3
/
8
% Senior Notes due 2020 and 8
3
/
4
% Senior Subordinated Notes due 2018
|
•
|
upon the sale of all of the capital stock of a subsidiary,
|
•
|
if the Company designates the subsidiary as an unrestricted subsidiary under the terms of the indentures, or
|
•
|
if the subsidiary is released as a guarantor from the Company's Corporate Credit Agreement.
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)
|
|||||||||||||||||||
|
Year Ended December 31, 2015
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer) |
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
614.2
|
|
|
$
|
592.2
|
|
|
$
|
(38.6
|
)
|
|
$
|
1,167.8
|
|
Operating costs and expenses
|
22.4
|
|
|
577.9
|
|
|
478.1
|
|
|
(38.6
|
)
|
|
1,039.8
|
|
|||||
Operating income (loss)
|
(22.4
|
)
|
|
36.3
|
|
|
114.1
|
|
|
—
|
|
|
128.0
|
|
|||||
Interest expense (income), net
|
112.7
|
|
|
(10.0
|
)
|
|
0.4
|
|
|
—
|
|
|
103.1
|
|
|||||
Other expense (income), net
|
19.5
|
|
|
(434.3
|
)
|
|
(10.9
|
)
|
|
—
|
|
|
(425.7
|
)
|
|||||
Income (loss) before equity in earnings of subsidiaries and income taxes
|
(154.6
|
)
|
|
480.6
|
|
|
124.6
|
|
|
—
|
|
|
450.6
|
|
|||||
Income tax expense (benefit)
|
(53.3
|
)
|
|
168.7
|
|
|
44.4
|
|
|
—
|
|
|
159.8
|
|
|||||
Equity in earnings of subsidiaries, net of tax
|
455.0
|
|
|
—
|
|
|
—
|
|
|
(455.0
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
353.7
|
|
|
311.9
|
|
|
80.2
|
|
|
(455.0
|
)
|
|
290.8
|
|
|||||
Income (loss) from discontinued operations
|
—
|
|
|
62.9
|
|
|
—
|
|
|
—
|
|
|
62.9
|
|
|||||
Net income (loss)
|
353.7
|
|
|
374.8
|
|
|
80.2
|
|
|
(455.0
|
)
|
|
353.7
|
|
|||||
Other comprehensive income (loss)
|
3.3
|
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
2.9
|
|
|||||
Total comprehensive income (loss)
|
$
|
357.0
|
|
|
$
|
374.8
|
|
|
$
|
79.8
|
|
|
$
|
(455.0
|
)
|
|
$
|
356.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
353.7
|
|
|
$
|
374.8
|
|
|
$
|
80.2
|
|
|
$
|
(455.0
|
)
|
|
$
|
353.7
|
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net income (loss) applicable to common shareowners
|
$
|
343.3
|
|
|
$
|
374.8
|
|
|
$
|
80.2
|
|
|
$
|
(455.0
|
)
|
|
$
|
343.3
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year Ended December 31, 2014
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer) |
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
599.1
|
|
|
$
|
601.5
|
|
|
$
|
(39.1
|
)
|
|
$
|
1,161.5
|
|
Operating costs and expenses
|
21.5
|
|
|
567.5
|
|
|
434.7
|
|
|
(39.1
|
)
|
|
984.6
|
|
|||||
Operating income (loss)
|
(21.5
|
)
|
|
31.6
|
|
|
166.8
|
|
|
—
|
|
|
176.9
|
|
|||||
Interest expense (income), net
|
142.6
|
|
|
6.4
|
|
|
(3.1
|
)
|
|
—
|
|
|
145.9
|
|
|||||
Other expense (income), net
|
17.6
|
|
|
(173.4
|
)
|
|
(12.3
|
)
|
|
—
|
|
|
(168.1
|
)
|
|||||
Income (loss) before equity in earnings of subsidiaries and income taxes
|
(181.7
|
)
|
|
198.6
|
|
|
182.2
|
|
|
—
|
|
|
199.1
|
|
|||||
Income tax expense (benefit)
|
(55.8
|
)
|
|
70.8
|
|
|
66.4
|
|
|
—
|
|
|
81.4
|
|
|||||
Equity in earnings of subsidiaries, net of tax
|
201.5
|
|
|
—
|
|
|
—
|
|
|
(201.5
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
75.6
|
|
|
127.8
|
|
|
115.8
|
|
|
(201.5
|
)
|
|
117.7
|
|
|||||
Income (loss) from discontinued operations
|
—
|
|
|
(42.1
|
)
|
|
—
|
|
|
—
|
|
|
(42.1
|
)
|
|||||
Net income (loss)
|
75.6
|
|
|
85.7
|
|
|
115.8
|
|
|
(201.5
|
)
|
|
75.6
|
|
|||||
Other comprehensive income (loss)
|
(40.5
|
)
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
(40.6
|
)
|
|||||
Total comprehensive income (loss)
|
$
|
35.1
|
|
|
$
|
85.6
|
|
|
$
|
115.8
|
|
|
$
|
(201.5
|
)
|
|
$
|
35.0
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
75.6
|
|
|
$
|
85.7
|
|
|
$
|
115.8
|
|
|
$
|
(201.5
|
)
|
|
$
|
75.6
|
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net income (loss) applicable to common shareowners
|
$
|
65.2
|
|
|
$
|
85.7
|
|
|
$
|
115.8
|
|
|
$
|
(201.5
|
)
|
|
$
|
65.2
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)
|
|||||||||||||||||||
|
Year Ended December 31, 2013
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer) |
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
503.1
|
|
|
$
|
608.6
|
|
|
$
|
(38.3
|
)
|
|
$
|
1,073.4
|
|
Operating costs and expenses
|
57.2
|
|
|
484.2
|
|
|
430.5
|
|
|
(38.3
|
)
|
|
933.6
|
|
|||||
Operating income (loss)
|
(57.2
|
)
|
|
18.9
|
|
|
178.1
|
|
|
—
|
|
|
139.8
|
|
|||||
Interest expense (income), net
|
162.5
|
|
|
10.7
|
|
|
2.8
|
|
|
—
|
|
|
176.0
|
|
|||||
Other expense (income), net
|
28.2
|
|
|
15.4
|
|
|
(6.6
|
)
|
|
—
|
|
|
37.0
|
|
|||||
Income (loss) before equity in earnings of subsidiaries and income taxes
|
(247.9
|
)
|
|
(7.2
|
)
|
|
181.9
|
|
|
—
|
|
|
(73.2
|
)
|
|||||
Income tax expense (benefit)
|
(79.8
|
)
|
|
5.3
|
|
|
66.2
|
|
|
—
|
|
|
(8.3
|
)
|
|||||
Equity in earnings of subsidiaries, net of tax
|
113.4
|
|
|
0.7
|
|
|
—
|
|
|
(114.1
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
(54.7
|
)
|
|
(11.8
|
)
|
|
115.7
|
|
|
(114.1
|
)
|
|
(64.9
|
)
|
|||||
Income (loss) from discontinued operations
|
—
|
|
|
10.2
|
|
|
—
|
|
|
—
|
|
|
10.2
|
|
|||||
Net income (loss)
|
(54.7
|
)
|
|
(1.6
|
)
|
|
115.7
|
|
|
(114.1
|
)
|
|
(54.7
|
)
|
|||||
Other comprehensive income (loss)
|
76.5
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
76.4
|
|
|||||
Total comprehensive income (loss)
|
$
|
21.8
|
|
|
$
|
(1.6
|
)
|
|
$
|
115.6
|
|
|
$
|
(114.1
|
)
|
|
$
|
21.7
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
$
|
(54.7
|
)
|
|
$
|
(1.6
|
)
|
|
$
|
115.7
|
|
|
$
|
(114.1
|
)
|
|
$
|
(54.7
|
)
|
Preferred stock dividends
|
10.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net income (loss) applicable to common shareowners
|
$
|
(65.1
|
)
|
|
$
|
(1.6
|
)
|
|
$
|
115.7
|
|
|
$
|
(114.1
|
)
|
|
$
|
(65.1
|
)
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Balance Sheets
|
|
|
|
|
|
|
|
|
|
||||||||||
|
As of December 31, 2015
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer) |
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash and cash equivalents
|
$
|
4.6
|
|
|
$
|
0.4
|
|
|
$
|
2.4
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
Receivables, net
|
0.7
|
|
|
2.8
|
|
|
153.6
|
|
|
—
|
|
|
157.1
|
|
|||||
Other current assets
|
1.6
|
|
|
15.6
|
|
|
18.7
|
|
|
—
|
|
|
35.9
|
|
|||||
Total current assets
|
6.9
|
|
|
18.8
|
|
|
174.7
|
|
|
—
|
|
|
200.4
|
|
|||||
Property, plant and equipment, net
|
0.3
|
|
|
53.4
|
|
|
921.8
|
|
|
—
|
|
|
975.5
|
|
|||||
Investment in CyrusOne
|
—
|
|
|
55.5
|
|
|
—
|
|
|
—
|
|
|
55.5
|
|
|||||
Goodwill and intangibles, net
|
—
|
|
|
12.3
|
|
|
2.2
|
|
|
—
|
|
|
14.5
|
|
|||||
Investments in and advances to subsidiaries
|
844.6
|
|
|
830.4
|
|
|
4.3
|
|
|
(1,679.3
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
214.4
|
|
|
133.2
|
|
|
7.1
|
|
|
(146.2
|
)
|
|
208.5
|
|
|||||
Total assets
|
$
|
1,066.2
|
|
|
$
|
1,103.6
|
|
|
$
|
1,110.1
|
|
|
$
|
(1,825.5
|
)
|
|
$
|
1,454.4
|
|
Current portion of long-term debt
|
$
|
5.4
|
|
|
$
|
3.4
|
|
|
$
|
5.0
|
|
|
$
|
—
|
|
|
$
|
13.8
|
|
Accounts payable
|
0.7
|
|
|
95.6
|
|
|
32.6
|
|
|
—
|
|
|
128.9
|
|
|||||
Other current liabilities
|
41.6
|
|
|
26.8
|
|
|
42.7
|
|
|
—
|
|
|
111.1
|
|
|||||
Other current liabilities from discontinued operations
|
—
|
|
|
5.4
|
|
|
—
|
|
|
—
|
|
|
5.4
|
|
|||||
Total current liabilities
|
47.7
|
|
|
131.2
|
|
|
80.3
|
|
|
—
|
|
|
259.2
|
|
|||||
Long-term debt, less current portion
|
1,025.8
|
|
|
53.3
|
|
|
152.7
|
|
|
—
|
|
|
1,231.8
|
|
|||||
Other noncurrent liabilities
|
235.5
|
|
|
11.8
|
|
|
160.5
|
|
|
(146.2
|
)
|
|
261.6
|
|
|||||
Intercompany payables
|
54.7
|
|
|
—
|
|
|
127.3
|
|
|
(182.0
|
)
|
|
—
|
|
|||||
Total liabilities
|
1,363.7
|
|
|
196.3
|
|
|
520.8
|
|
|
(328.2
|
)
|
|
1,752.6
|
|
|||||
Shareowners’ (deficit) equity
|
(297.5
|
)
|
|
907.3
|
|
|
589.3
|
|
|
(1,497.3
|
)
|
|
(298.2
|
)
|
|||||
Total liabilities and shareowners’ equity (deficit)
|
$
|
1,066.2
|
|
|
$
|
1,103.6
|
|
|
$
|
1,110.1
|
|
|
$
|
(1,825.5
|
)
|
|
$
|
1,454.4
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Balance Sheets
|
|||||||||||||||||||
|
As of December 31, 2014
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer) |
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash and cash equivalents
|
$
|
56.2
|
|
|
$
|
0.2
|
|
|
$
|
1.5
|
|
|
$
|
—
|
|
|
$
|
57.9
|
|
Receivables, net
|
2.6
|
|
|
6.1
|
|
|
159.8
|
|
|
—
|
|
|
168.5
|
|
|||||
Other current assets
|
1.3
|
|
|
20.6
|
|
|
15.7
|
|
|
—
|
|
|
37.6
|
|
|||||
Other current assets from discontinued operations
|
—
|
|
|
4.7
|
|
|
—
|
|
|
—
|
|
|
4.7
|
|
|||||
Total current assets
|
60.1
|
|
|
31.6
|
|
|
177.0
|
|
|
—
|
|
|
268.7
|
|
|||||
Property, plant and equipment, net
|
0.2
|
|
|
50.8
|
|
|
764.4
|
|
|
—
|
|
|
815.4
|
|
|||||
Investment in CyrusOne
|
—
|
|
|
273.6
|
|
|
—
|
|
|
—
|
|
|
273.6
|
|
|||||
Goodwill and intangibles, net
|
—
|
|
|
12.7
|
|
|
2.2
|
|
|
—
|
|
|
14.9
|
|
|||||
Investments in and advances to subsidiaries
|
1,066.1
|
|
|
403.6
|
|
|
199.3
|
|
|
(1,669.0
|
)
|
|
—
|
|
|||||
Other noncurrent assets
|
297.6
|
|
|
240.9
|
|
|
8.2
|
|
|
(143.2
|
)
|
|
403.5
|
|
|||||
Other noncurrent assets from discontinued operations
|
—
|
|
|
44.6
|
|
|
—
|
|
|
—
|
|
|
44.6
|
|
|||||
Total assets
|
$
|
1,424.0
|
|
|
$
|
1,057.8
|
|
|
$
|
1,151.1
|
|
|
$
|
(1,812.2
|
)
|
|
$
|
1,820.7
|
|
Current portion of long-term debt
|
$
|
5.4
|
|
|
$
|
2.3
|
|
|
$
|
3.9
|
|
|
$
|
—
|
|
|
$
|
11.6
|
|
Accounts payable
|
1.0
|
|
|
76.2
|
|
|
54.8
|
|
|
—
|
|
|
132.0
|
|
|||||
Other current liabilities
|
52.3
|
|
|
23.5
|
|
|
49.3
|
|
|
0.1
|
|
|
125.2
|
|
|||||
Other current liabilities from discontinued operations
|
—
|
|
|
142.0
|
|
|
—
|
|
|
—
|
|
|
142.0
|
|
|||||
Total current liabilities
|
58.7
|
|
|
244.0
|
|
|
108.0
|
|
|
0.1
|
|
|
410.8
|
|
|||||
Long-term debt, less current portion
|
1,526.1
|
|
|
2.9
|
|
|
160.4
|
|
|
—
|
|
|
1,689.4
|
|
|||||
Other noncurrent liabilities
|
254.1
|
|
|
4.6
|
|
|
151.0
|
|
|
(143.4
|
)
|
|
266.3
|
|
|||||
Other noncurrent liabilities from discontinued operations
|
—
|
|
|
102.7
|
|
|
—
|
|
|
—
|
|
|
102.7
|
|
|||||
Intercompany payables
|
233.4
|
|
|
—
|
|
|
131.9
|
|
|
(365.3
|
)
|
|
—
|
|
|||||
Total liabilities
|
2,072.3
|
|
|
354.2
|
|
|
551.3
|
|
|
(508.6
|
)
|
|
2,469.2
|
|
|||||
Shareowners’ (deficit) equity
|
(648.3
|
)
|
|
703.6
|
|
|
599.8
|
|
|
(1,303.6
|
)
|
|
(648.5
|
)
|
|||||
Total liabilities and shareowners’ equity (deficit)
|
$
|
1,424.0
|
|
|
$
|
1,057.8
|
|
|
$
|
1,151.1
|
|
|
$
|
(1,812.2
|
)
|
|
$
|
1,820.7
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
Year Ended December 31, 2015
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer)
|
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash flows provided by (used in) operating activities
|
$
|
(19.3
|
)
|
|
$
|
(44.0
|
)
|
|
$
|
174.2
|
|
|
$
|
—
|
|
|
$
|
110.9
|
|
Capital expenditures
|
(0.1
|
)
|
|
(22.5
|
)
|
|
(261.0
|
)
|
|
—
|
|
|
(283.6
|
)
|
|||||
Proceeds received from sale of CyrusOne
|
—
|
|
|
643.9
|
|
|
—
|
|
|
—
|
|
|
643.9
|
|
|||||
Dividends received from CyrusOne
|
—
|
|
|
22.2
|
|
|
—
|
|
|
—
|
|
|
22.2
|
|
|||||
Proceeds from sale of assets
|
—
|
|
|
0.9
|
|
|
0.1
|
|
|
—
|
|
|
1.0
|
|
|||||
Distributions received from subsidiaries
|
11.3
|
|
|
—
|
|
|
—
|
|
|
(11.3
|
)
|
|
—
|
|
|||||
Funding between Parent and subsidiaries, net
|
—
|
|
|
(597.1
|
)
|
|
114.7
|
|
|
482.4
|
|
|
—
|
|
|||||
Other investing activities
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|||||
Cash flows provided by (used in) investing activities
|
10.9
|
|
|
47.4
|
|
|
(146.2
|
)
|
|
471.1
|
|
|
383.2
|
|
|||||
Funding between Parent and subsidiaries, net
|
486.4
|
|
|
—
|
|
|
(4.0
|
)
|
|
(482.4
|
)
|
|
—
|
|
|||||
Distributions paid to Parent
|
—
|
|
|
—
|
|
|
(11.3
|
)
|
|
11.3
|
|
|
—
|
|
|||||
Net decrease in corporate credit and receivables facilities with initial maturities less than 90 days
|
—
|
|
|
—
|
|
|
(1.6
|
)
|
|
—
|
|
|
(1.6
|
)
|
|||||
Repayment of debt
|
(518.5
|
)
|
|
(3.2
|
)
|
|
(10.0
|
)
|
|
—
|
|
|
(531.7
|
)
|
|||||
Debt issuance costs
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.4
|
)
|
|||||
Other financing activities
|
(10.9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.9
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
(43.2
|
)
|
|
(3.2
|
)
|
|
(27.1
|
)
|
|
(471.1
|
)
|
|
(544.6
|
)
|
|||||
Increase (decrease) in cash and cash equivalents
|
(51.6
|
)
|
|
0.2
|
|
|
0.9
|
|
|
—
|
|
|
(50.5
|
)
|
|||||
Beginning cash and cash equivalents
|
56.2
|
|
|
0.2
|
|
|
1.5
|
|
|
—
|
|
|
57.9
|
|
|||||
Ending cash and cash equivalents
|
$
|
4.6
|
|
|
$
|
0.4
|
|
|
$
|
2.4
|
|
|
$
|
—
|
|
|
$
|
7.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year Ended December 31, 2014
|
||||||||||||||||||
(dollars in millions)
|
Parent
(Issuer)
|
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash flows provided by (used in) operating activities
|
$
|
(56.3
|
)
|
|
$
|
1.0
|
|
|
$
|
230.5
|
|
|
$
|
—
|
|
|
$
|
175.2
|
|
Capital expenditures
|
(0.2
|
)
|
|
(29.6
|
)
|
|
(152.5
|
)
|
|
—
|
|
|
(182.3
|
)
|
|||||
Proceeds from sale of CyrusOne
|
—
|
|
|
355.9
|
|
|
—
|
|
|
—
|
|
|
355.9
|
|
|||||
Dividends received from CyrusOne
|
—
|
|
|
28.4
|
|
|
—
|
|
|
—
|
|
|
28.4
|
|
|||||
Proceeds from sale of assets
|
—
|
|
|
194.4
|
|
|
2.0
|
|
|
—
|
|
|
196.4
|
|
|||||
Distributions received from subsidiaries
|
12.8
|
|
|
—
|
|
|
—
|
|
|
(12.8
|
)
|
|
—
|
|
|||||
Funding between Parent and subsidiaries, net
|
—
|
|
|
(541.7
|
)
|
|
(75.6
|
)
|
|
617.3
|
|
|
—
|
|
|||||
Other investing activities
|
(0.3
|
)
|
|
(5.5
|
)
|
|
—
|
|
|
—
|
|
|
(5.8
|
)
|
|||||
Cash flows provided by (used in) investing activities
|
12.3
|
|
|
1.9
|
|
|
(226.1
|
)
|
|
604.5
|
|
|
392.6
|
|
|||||
Funding between Parent and subsidiaries, net
|
516.2
|
|
|
—
|
|
|
101.1
|
|
|
(617.3
|
)
|
|
—
|
|
|||||
Distributions paid to Parent
|
—
|
|
|
—
|
|
|
(12.8
|
)
|
|
12.8
|
|
|
—
|
|
|||||
Net increase in corporate credit and receivables facilities with initial maturities less than 90 days
|
(40.0
|
)
|
|
—
|
|
|
(87.0
|
)
|
|
—
|
|
|
(127.0
|
)
|
|||||
Repayment of debt
|
(367.3
|
)
|
|
(3.0
|
)
|
|
(6.2
|
)
|
|
—
|
|
|
(376.5
|
)
|
|||||
Debt issuance costs
|
(0.7
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.9
|
)
|
|||||
Proceeds from exercise of options and warrants
|
1.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.3
|
|
|||||
Other financing activities
|
(11.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11.4
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
98.1
|
|
|
(3.0
|
)
|
|
(5.1
|
)
|
|
(604.5
|
)
|
|
(514.5
|
)
|
|||||
Increase (decrease) in cash and cash equivalents
|
54.1
|
|
|
(0.1
|
)
|
|
(0.7
|
)
|
|
—
|
|
|
53.3
|
|
|||||
Beginning cash and cash equivalents
|
2.1
|
|
|
0.3
|
|
|
2.2
|
|
|
—
|
|
|
4.6
|
|
|||||
Ending cash and cash equivalents
|
$
|
56.2
|
|
|
$
|
0.2
|
|
|
$
|
1.5
|
|
|
$
|
—
|
|
|
$
|
57.9
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
Condensed Consolidating Statements of Cash Flows
|
|||||||||||||||||||
|
Year Ended December 31, 2013
|
||||||||||||||||||
(dollars in millions)
|
Parent (Issuer)
|
|
Guarantors
|
|
Non-guarantors
|
|
Eliminations
|
|
Total
|
||||||||||
Cash flows provided by (used in) operating activities
|
$
|
(218.1
|
)
|
|
$
|
28.8
|
|
|
$
|
268.1
|
|
|
$
|
—
|
|
|
$
|
78.8
|
|
Capital expenditures
|
—
|
|
|
(36.1
|
)
|
|
(160.8
|
)
|
|
—
|
|
|
(196.9
|
)
|
|||||
Dividends received from CyrusOne
|
—
|
|
|
21.3
|
|
|
—
|
|
|
—
|
|
|
21.3
|
|
|||||
Proceeds from sale of assets
|
—
|
|
|
—
|
|
|
2.0
|
|
|
—
|
|
|
2.0
|
|
|||||
Cash divested from deconsolidation of CyrusOne
|
—
|
|
|
—
|
|
|
(12.2
|
)
|
|
—
|
|
|
(12.2
|
)
|
|||||
Other investing activities
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
|||||
Cash flows provided by (used in) investing activities
|
—
|
|
|
(14.8
|
)
|
|
(170.6
|
)
|
|
—
|
|
|
(185.4
|
)
|
|||||
Issuance of long-term debt
|
536.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
536.0
|
|
|||||
Funding between Parent and subsidiaries, net
|
174.2
|
|
|
(10.0
|
)
|
|
(164.2
|
)
|
|
—
|
|
|
—
|
|
|||||
Net increase in corporate credit and receivables facilities with initial maturities less than 90 days
|
40.0
|
|
|
—
|
|
|
54.2
|
|
|
—
|
|
|
94.2
|
|
|||||
Repayment of debt
|
(522.0
|
)
|
|
(4.0
|
)
|
|
(4.8
|
)
|
|
—
|
|
|
(530.8
|
)
|
|||||
Debt issuance costs
|
(6.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6.7
|
)
|
|||||
Proceeds from exercise of options and warrants
|
7.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7.1
|
|
|||||
Other financing activities
|
(12.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12.2
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
216.4
|
|
|
(14.0
|
)
|
|
(114.8
|
)
|
|
—
|
|
|
87.6
|
|
|||||
Increase (decrease) in cash and cash equivalents
|
(1.7
|
)
|
|
—
|
|
|
(17.3
|
)
|
|
—
|
|
|
(19.0
|
)
|
|||||
Beginning cash and cash equivalents
|
3.8
|
|
|
0.3
|
|
|
19.5
|
|
|
—
|
|
|
23.6
|
|
|||||
Ending cash and cash equivalents
|
$
|
2.1
|
|
|
$
|
0.3
|
|
|
$
|
2.2
|
|
|
$
|
—
|
|
|
$
|
4.6
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
|
2015
|
||||||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
|
||||||||||
(dollars in millions, except per common share amounts)
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Total
|
||||||||||
Revenue
|
$
|
292.9
|
|
|
$
|
285.8
|
|
|
$
|
299.8
|
|
|
$
|
289.3
|
|
|
$
|
1,167.8
|
|
Operating income
|
37.1
|
|
|
29.7
|
|
|
36.2
|
|
|
25.0
|
|
|
128.0
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
0.3
|
|
|
180.7
|
|
|
79.3
|
|
|
30.5
|
|
|
290.8
|
|
|||||
Income from discontinued operations, net of tax
|
48.9
|
|
|
10.9
|
|
|
1.0
|
|
|
2.1
|
|
|
62.9
|
|
|||||
Net income
|
49.2
|
|
|
191.6
|
|
|
80.3
|
|
|
32.6
|
|
|
353.7
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings (loss) per common share from continuing operations
|
$
|
(0.01
|
)
|
|
$
|
0.85
|
|
|
$
|
0.37
|
|
|
$
|
0.13
|
|
|
$
|
1.34
|
|
Basic earnings per common share from discontinued operations
|
$
|
0.23
|
|
|
$
|
0.05
|
|
|
$
|
—
|
|
|
$
|
0.01
|
|
|
$
|
0.30
|
|
Net basic earnings per common share
|
$
|
0.22
|
|
|
$
|
0.90
|
|
|
$
|
0.37
|
|
|
$
|
0.14
|
|
|
$
|
1.64
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings (loss) per common share from continuing operations
|
$
|
(0.01
|
)
|
|
$
|
0.84
|
|
|
$
|
0.37
|
|
|
$
|
0.13
|
|
|
$
|
1.33
|
|
Diluted earnings per common share from discontinued operations
|
$
|
0.23
|
|
|
$
|
0.05
|
|
|
$
|
—
|
|
|
$
|
0.01
|
|
|
$
|
0.30
|
|
Net diluted earnings per common share
|
$
|
0.22
|
|
|
$
|
0.89
|
|
|
$
|
0.37
|
|
|
$
|
0.14
|
|
|
$
|
1.63
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
2014
|
||||||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
|
||||||||||
(dollars in millions, except per common share amounts)
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Total
|
||||||||||
Revenue
|
$
|
282.2
|
|
|
$
|
283.0
|
|
|
$
|
301.4
|
|
|
$
|
294.9
|
|
|
$
|
1,161.5
|
|
Operating income
|
50.4
|
|
|
47.3
|
|
|
47.8
|
|
|
31.4
|
|
|
176.9
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
5.9
|
|
|
123.7
|
|
|
(7.5
|
)
|
|
(4.4
|
)
|
|
117.7
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
1.1
|
|
|
(9.5
|
)
|
|
(19.8
|
)
|
|
(13.9
|
)
|
|
(42.1
|
)
|
|||||
Net income (loss)
|
7.0
|
|
|
114.2
|
|
|
(27.3
|
)
|
|
(18.3
|
)
|
|
75.6
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings (loss) per common share from continuing operations
|
$
|
0.02
|
|
|
$
|
0.58
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
0.51
|
|
Basic earnings (loss) per common share from discontinued operations
|
$
|
—
|
|
|
$
|
(0.04
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.20
|
)
|
Net basic earnings (loss) per common share
|
$
|
0.02
|
|
|
$
|
0.54
|
|
|
$
|
(0.14
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
0.31
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings (loss) per common share from continuing operations
|
$
|
0.02
|
|
|
$
|
0.58
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
0.51
|
|
Diluted earnings (loss) per common share from discontinued operations
|
$
|
—
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.20
|
)
|
Net diluted earnings (loss) per common share
|
$
|
0.02
|
|
|
$
|
0.53
|
|
|
$
|
(0.14
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
0.31
|
|
Form 10-K Part II
|
|
Cincinnati Bell Inc.
|
(a)
|
Evaluation of disclosure controls and procedures.
|
Name
|
|
Age
|
|
Title
|
Theodore H. Torbeck (a)
|
|
59
|
|
President and Chief Executive Officer
|
Leigh R. Fox
|
|
43
|
|
Chief Financial Officer
|
Thomas E. Simpson
|
|
43
|
|
Chief Technology Officer
|
Christopher J. Wilson
|
|
50
|
|
Vice President, General Counsel and Secretary
|
Joshua T. Duckworth
|
|
37
|
|
Vice President, Investor Relations and Controller
|
|
|
|
|
|
(a) Member of the Board of Directors
|
|
|
Exhibit
Number
|
|
Description
|
(3.1)
|
|
Amended and Restated Articles of Incorporation of Cincinnati Bell Inc. (Exhibit 3.1 to Current Report on Form 8-K, date of Report April 25, 2008, File No. 1-8519).
|
(3.2)
|
|
Amended and Restated Regulations of Cincinnati Bell Inc. (Exhibit 3.2 to Current Report on Form 8-K, date of Report April 25, 2008, File No. 1-8519).
|
(4.1)
|
|
Indenture dated July 1, 1993, between Cincinnati Bell Inc., as Issuer, and The Bank of New York, as Trustee, relating to Cincinnati Bell Inc.’s 7
1
/
4
% Notes Due June 15, 2023 (Exhibit 4-A to Current Report on Form 8-K, date of Report July 12, 1993, File No. 1-8519).
|
(4.2)
|
|
Indenture dated as of March 15, 2010, by and among Cincinnati Bell Inc., as Issuer, the subsidiaries of Cincinnati Bell Inc. party thereto, as Guarantors, and The Bank of New York Mellon, as Trustee, relating to Cincinnati Bell Inc.’s 8
3
/
4
% Senior Subordinated Notes due 2018 (Exhibit 4.1 to Current Report on Form 8-K, date of Report March 15, 2010, File No. 1-8519).
|
(4.3)
|
|
Indenture dated as of October 13, 2010, by and among Cincinnati Bell Inc., as Issuer, the subsidiaries of Cincinnati Bell Inc. party thereto, as Guarantors, and The Bank of New York Mellon, as Trustee, relating to Cincinnati Bell Inc.’s 8
3
/
8
% Senior Notes due 2020 (Exhibit 4.1 to Current Report on Form 8-K, date of Report October 13, 2010, File No. 1-8519).
|
(4.4)
|
|
Indenture dated as of November 30, 1998, among Cincinnati Bell Telephone Company, as Issuer, Cincinnati Bell Inc., as Guarantor, and The Bank of New York, as Trustee (Exhibit 4-A to Current Report on Form 8-K, date of Report November 30, 1998, File No. 1-8519).
|
(4.5)
|
|
First Supplemental Indenture dated as of December 31, 2004 to the Indenture dated as of November 30, 1998, among Cincinnati Bell Telephone Company, as Issuer, Cincinnati Bell Inc., as Guarantor, and The Bank of New York, as Trustee (Exhibit 4(c)(iii)(2) to Annual Report on Form 10-K for the year ended December 31, 2004, File No. 1-8519).
|
(4.6)
|
|
Second Supplemental Indenture dated as of January 10, 2005 to the Indenture dated as of November 30, 1998, among Cincinnati Bell Telephone Company LLC (as successor entity to Cincinnati Bell Telephone Company), as Issuer, Cincinnati Bell Inc., as Guarantor, and The Bank of New York, as Trustee (Exhibit (4)(c)(iii)(3) to Annual Report on Form 10-K for the year ended December 31, 2004, File No. 1-8519).
|
(4.7)
|
|
Warrant Agreement dated as of March 26, 2003, by and among Broadwing Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers (Exhibit (4)(c)(vii) to Annual Report on Form 10-K for the year ended December 31, 2002, File No. 1-8519).
|
(4.8)
|
|
Equity Registration Rights Agreement dated as of March 26, 2003, by and between Broadwing Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers (Exhibit (4)(c)(ix) to Annual Report on Form 10-K for the year ended December 31, 2002, File No. 1-8519).
|
(4.90)
|
|
Purchase Agreement dated as of December 9, 2002, by and among Broadwing Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers of Senior Subordinated Discount Notes due 2009 (Exhibit (4)(c)(x)(1) to Annual Report on Form 10-K for the year ended December 31, 2002, File No. 1-8519).
|
(4.10)
|
|
First Amendment to Purchase Agreement dated as of March 26, 2003, by and among Broadwing Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers of Senior Subordinated Discount Notes due 2009 (Exhibit (4)(c)(x)(2) to Annual Report on Form 10-K for the year ended December 31, 2002, File No. 1-8519).
|
(4.11)
|
|
Second Amendment to Purchase Agreement dated as of April 30, 2004, by and among Cincinnati Bell Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers of Senior Subordinated Discount Notes due 2009 (Exhibit (4)(c)(x)(3) to Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, File No. 1-8519).
|
(4.12)
|
|
Third Amendment to Purchase Agreement dated April 30, 2004, by and among Cincinnati Bell Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers of Senior Subordinated Discount Notes due 2009 (Exhibit 4(c)(viii)(4) to Annual Report on Form 10-K for the year ended December 31, 2004, File No. 1-8519).
|
(4.13)
|
|
Fourth Amendment to Purchase Agreement dated January 31, 2005, by and among Cincinnati Bell Inc., GS Mezzanine Partners II, L.P., GS Mezzanine Partners II Offshore, L.P., and any other affiliate purchasers of Senior Subordinated Discount Notes due 2009 (Exhibit 4(c)(viii)(5) to Annual Report on Form 10-K for the year ended December 31, 2004, File No. 1-8519).
|
(4.14)
|
|
No other instrument which defines the rights of holders of long term debt of the registrant is filed herewith pursuant to Regulation S-K, Item 601(b)(4)(iii)(A). Pursuant to this regulation, the registrant hereby agrees to furnish a copy of any such instrument to the SEC upon request.
|
(10.1)
|
|
Credit Agreement dated as of November 20, 2012, among Cincinnati Bell Inc., an Ohio corporation, the subsidiary guarantors party thereto, the Lenders party thereto and Bank of America, N.A. (Exhibit 10.1 to Current Report on Form 8-K, date of Report November 20, 2012, File No. 1-8519).
|
(10.2)
|
|
First Amendment to Credit Agreement dated as of September 10, 2013, among Cincinnati Bell Inc., an Ohio corporation, the subsidiary guarantors party thereto, the Lenders party thereto and Bank of America, N.A. (Exhibit 10.1 to Current Report on Form 8-K, date of Report September 10, 2013, File No. 1-8519).
|
(10.3)
|
|
Annex I to First Amendment to Credit Agreement dated as of September 10, 2013, among Cincinnati Bell Inc., an Ohio corporation, the subsidiary guarantors party thereto, the Lenders party thereto and Bank of America, N.A. (Exhibit 10.2 to Current Report on Form 8-K, date of Report September 10, 2013, File No. 1-8519).
|
(10.4)
|
|
Second Amendment to Credit Agreement dated as of June 23, 2014, among Cincinnati Bell Inc., an Ohio corporation, the subsidiary guarantors party thereto, the Lenders party thereto and Bank of America, N.A. (Exhibit 10.4 to Annual Report on Form 10-K, date of Report February 26, 2015, File No. 1-8519).
|
(10.5)
|
|
Third Amendment to Credit Agreement dated as of September 30, 2014, among Cincinnati Bell Inc., an Ohio corporation, the subsidiary guarantors party thereto, the Lenders party thereto and Bank of America, N.A. (Exhibit 10.1 to Current Report on Form 8-K, date of Report September 30, 2014, File No. 1-8519).
|
(10.6)
|
|
Fourth Amendment to Credit Agreement dated as of November 5, 2014, among Cincinnati Bell Inc., an Ohio corporation, the subsidiary guarantors party thereto, the Lenders party thereto and Bank of America, N.A. (Exhibit 10.1 to Current Report on Form 8-K, date of Report November 5, 2014, File No. 1-8519).
|
(10.7)
|
|
Amended and Restated Purchase and Sale Agreement dated as of June 6, 2011, among the Originators identified therein, Cincinnati Bell Funding LLC, and Cincinnati Bell Inc., as Servicer and sole member of Cincinnati Bell Funding LLC (Exhibit 99.2 to Current Report on Form 8-K, date of Report June 6, 2011, File No. 1-8519).
|
(10.8)
|
|
First Amendment to Purchase and Sale Agreement dated as of August 1, 2011, among the Originators identified therein, Cincinnati Bell Funding LLC and Cincinnati Bell Inc. as Servicer and sole member of Cincinnati Bell Funding LLC (Exhibit 99.2 to Current Report on Form 8-K, date of Report August 1, 2011, File No. 1-8519).
|
(10.9)
|
|
Second Amendment to Amended and Restated Purchase and Sale Agreement dated as of October 1, 2012, among the Originators identified therein, Cincinnati Bell Funding LLC and Cincinnati Bell Inc. as Servicer and sole member of Cincinnati Bell Funding LLC. (Exhibit 99.2 to Current Report on Form 8-K, date of Report October 1, 2012, File No. 1-8519).
|
(10.10)
|
|
Third Amendment to Amended and Restated Purchase and Sale Agreement, dated as of June 1, 2015, among Cincinnati Bell Wireless, LLC, Cincinnati Bell Funding LLC and Cincinnati Bell Inc. (Exhibit 10.2 to Current Report on Form 8-K, Date of Report June 1, 2015, File No. 1-8519).
|
(10.11)
|
|
Amended and Restated Receivables Purchase Agreement dated as of June 6, 2011, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell Inc., as Servicer, the Various Purchaser Groups identified therein, and PNC Bank, National Association, as Administrator and LC Bank (Exhibit 99.1 to Current Report on Form 8-K, date of Report June 6, 2011, File No. 1-8519).
|
(10.12)
|
|
First Amendment to Amended and Restated Receivables Purchase Agreement dated as of August 1, 2011, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell Inc., as Servicer, the Various Purchasers and Purchaser Agents identified therein, and PNC Bank, National Association, as Administrator and LC Bank (Exhibit 99.1 to Current Report on Form 8-K, date of Report August 1, 2011, File No. 1-8519).
|
(10.13)
|
|
Second Amendment to Amended and Restated Receivables Purchase Agreement dated as of June 4, 2012, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell Inc., as Servicer, the Various Purchaser Groups identified therein, and PNC Bank, National Association, as Administrator and LC Bank (Exhibit 99.1 to Current Report on Form 8-K, date of Report June 4, 2012, File No. 1-8519).
|
(10.14)
|
|
Third Amendment to Amended and Restated Receivables Purchase Agreement dated as of October 1, 2012, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell Inc., as Servicer, the Various Purchaser Groups identified therein, and PNC Bank, National Association, as Administrator and LC Bank. (Exhibit 99.1 to Current Report on Form 8-K, date of Report October 1, 2012, File No. 1-8519).
|
(10.15)
|
|
Fourth Amendment to Amended and Restated Receivables Purchase Agreement, dated as of June 3, 2013, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell, Inc., as Servicer, the various Purchasers and Purchaser Agents identified therein, and PNC Bank, National Association, as Administrator (Exhibit 99.1 to Current Report on Form 8-K, date of Report June 3, 2013, File No. 1-8519).
|
(10.16)
|
|
Fifth Amendment to Amended and Restated Receivables Purchase Agreement, dated as of September 13, 2013, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell, Inc., as Servicer, the various Purchasers and Purchaser Agents identified therein, and PNC Bank, National Association, as Administrator (Exhibit 10.16 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.17)
|
|
Sixth Amendment to Amended and Restated Receivables Purchase Agreement, dated as of June 2, 2014, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell, Inc., as Servicer, the various Purchasers and Purchaser Agents identified therein, and PNC Bank, National Association, as Administrator (Exhibit 99.1 to Current Report on Form 8-K, date of Report June 2, 2014, File No. 1-8519).
|
(10.18)
|
|
Seventh Amendment to Amended and Restated Receivables Purchase Agreement, dated as of September 30, 2014, among Cincinnati Bell Funding LLC, as Seller, Cincinnati Bell, Inc., as Servicer, the various Purchasers and Purchaser Agents identified therein, and PNC Bank, National Association, as Administrator (Exhibit 10.17 to Annual Report on Form 10-K, date of Report February 26, 2015, File No. 1-8519).
|
(10.19)
|
|
Eighth Amendment to Amended and Restated Receivables Purchase Agreement, dated June 1, 2015, among Cincinnati Bell Funding LLC , as Seller, Cincinnati Bell, Inc., as Servicer and Performance Guarantor, the various Purchasers and Purchaser Agents identified therein, and PNC Bank, National Association, as Administrator (Exhibit 10.1 to Current Report on Form 8-K, Date of Report June 1, 2015, File No. 1-8519).
|
(10.20)
|
|
License Purchase Agreement dated as of April 6, 2014 among Cincinnati Bell Wireless, LLC, an Ohio limited liability company, and Cellco Partnership, a Delaware general partnership doing business as Verizon Wireless (Exhibit 10.1 to Current Report on Form 8-K, date of Report April 7, 2014, File No. 1-8519).
|
(10.21)
|
|
Network Asset Purchase Agreement dated as of April 6, 2014 among Cincinnati Bell Wireless, LLC, an Ohio limited liability company, and Cellco Partnership, a Delaware general partnership doing business as Verizon Wireless (Exhibit 10.2 to Current Report on Form 8-K, date of Report April 7, 2014, File No. 1-8519).
|
(10.22)
|
|
Incremental Assumption Agreement dated April 6, 2015 among Cincinnati Bell Inc. an Ohio corporation, the subsidiary guarantors thereto, Bank of America, N.A., and the additional lenders thereto (Exhibit 10.1 to Current Report on Form 8-K, date of Report April 6, 2015, File No. 1-8519).
|
(10.23)
|
|
Assignment Agreement, dated as of June 1, 2015, among Cincinnati Bell Funding LLC, Cincinnati Bell Wireless, LLC, and PNC Bank, National Association (Exhibit 10.3 to Current Report on Form 8-K, Date of Report June 1, 2015, File No. 1-8519).
|
(10.24)*
|
|
Cincinnati Bell Inc. Pension Program, as amended and restated effective January 1, 2005 (Exhibit (10)(iii)(A)(3) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.25)*
|
|
Amendment to Cincinnati Bell Inc. Pension Program, effective December 31, 2011 (Exhibit 10.12 to Annual Report on Form 10-K for the year ended December 31, 2011, File No. 1-8519).
|
(10.26)*
|
|
Restatement of the Cincinnati Bell Management Pension Plan executed January 17, 2011 (Exhibit 10.13 to Annual Report on Form 10-K for the year ended December 31, 2011, File No. 1-8519).
|
(10.27)*
|
|
Restatement of the Cincinnati Bell Pension Plan executed January 25, 2011 (Exhibit 10.14 to Annual Report on Form 10-K for the year ended December 31, 2011, File No. 1-8519).
|
(10.28)*
|
|
Amendment to Cincinnati Bell Management Pension Plan executed December 20, 2013 (Exhibit 10.21 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.29)*
|
|
Amendment to Cincinnati Bell Management Pension Plan executed May 16, 2013 (Exhibit 10.22 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.30)*
|
|
Amendment to Cincinnati Bell Management Pension Plan executed April 17, 2012 (Exhibit 10.23 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.31)*
|
|
Amendment to Cincinnati Bell Management Pension Plan executed December 20, 2011 (Exhibit 10.24 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.32)*
|
|
Amendment to Cincinnati Bell Pension Plan executed on December 20, 2013 (Exhibit 10.25 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.33)*
|
|
Amendment to Cincinnati Bell Pension Plan executed on April 17, 2012 (Exhibit 10.26 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.34)*
|
|
Amendment to Cincinnati Bell Pension Plan executed on November 29, 2011 (Exhibit 10.27 to Annual Report on Form 10-K for the year ended December 31, 2013, File No. 1-8519).
|
(10.35) +
|
|
Amendment to the Cincinnati Bell Pension Plan executed May 1, 2015.
|
(10.36)*
|
|
Cincinnati Bell Inc. 2011 Short Term Incentive Plan (Appendix A to the Company's 2011 Proxy Statement on Schedule 14A filed March 21, 2011, File No. 1-8519).
|
(10.37)*
|
|
Cincinnati Bell Inc. Deferred Compensation Plan for Outside Directors, as amended and restated as of January 1, 2005 (Exhibit (10)(iii)(A)(2) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.38)*
|
|
Cincinnati Bell Inc. Executive Deferred Compensation Plan, as amended and restated effective January 1, 2005 (Exhibit (10)(iii)(A)(4) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.39)*
|
|
Cincinnati Bell Inc. 2007 Long Term Incentive Plan, as amended (Appendix I to the Company's 2014 Proxy Statement on Schedule 14A filed March 20, 2015, File No. 1-8519).
|
(10.40)*
|
|
Form of Award Agreement to be implemented under the 2007 Long Term Incentive Plan dated as of December 7, 2010 (Exhibit 10.1 to Current Report on Form 8-K, date of Report December 7, 2010, File No. 1-8519).
|
(10.41)*
|
|
Cincinnati Bell Inc. Form of Stock Option Agreement (2007 Long Term Incentive Plan) (Exhibit (10)(iii)(A)(22) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.42)*
|
|
Cincinnati Bell Inc. Form of Performance Restricted Stock Agreement (2007 Long Term Incentive Plan) (Exhibit (10)(iii)(A)(23) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.43)*
|
|
Cincinnati Bell Inc. Form of 2008-2010 Performance Share Agreement (2007 Long Term Incentive Plan) (Exhibit (10)(iii)(A)(24) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.44)*
|
|
Cincinnati Bell Inc. Form of Stock Appreciation Rights Agreement (Employees) (Exhibit (10)(iii)(A)(21) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.45) +
|
|
Cincinnati Bell Inc. Form of Restricted Stock Unit Award Agreement (2007 Long Term Incentive Plan).
|
(10.46)*
|
|
Cincinnati Bell Inc. 2007 Stock Option Plan for Non-Employee Directors, as amended (Appendix B to the Company's 2012 Proxy Statement on Schedule 14A filed on March 16, 2012, File No. 1-8519).
|
(10.47)*
|
|
Executive Compensation Recoupment/Clawback Policy effective as of January 1, 2011 (Exhibit 99.1 to Current Report on Form 8-K, date of Report October 29, 2010, File No. 1-8519).
|
(10.48)*
|
|
Amended and Restated Employment Agreement effective January 1, 2005, between Cincinnati Bell Inc. and Christopher J. Wilson (Exhibit (10)(iii)(A)(10) to Annual Report on Form 10-K for the year ended December 31, 2008, File No. 1-8519).
|
(10.49)*
|
|
Amended and Restated Employment Agreement between Cincinnati Bell Inc. and Christopher J. Wilson effective July 26, 2013 (Exhibit 10.1 to Current Report on Form 8-K, date of Report July 26, 2013, File No. 1-8519).
|
(10.50)*
|
|
Amended and Restated Employment Agreement between Cincinnati Bell Inc. and Christopher J. Wilson effective January 1, 2015 (Exhibit 10.51 to Current Report on Form 10-K, date of report February 26, 2015, File No. 1-8519).
|
(10.51)*
|
|
Amended and Restated Employment Agreement dated September 7, 2010 between Cincinnati Bell Inc. and Theodore H. Torbeck (Exhibit 10.1 to Current Report on Form 8-K, date of Report September 7, 2010, File No. 1-8519).
|
(10.52)*
|
|
Employment Agreement dated as of February 6, 2013 between Cincinnati Bell Inc. and Theodore H. Torbeck (Exhibit 10.1 to Current Report on Form 8-K, date of Report January 31, 2013, File No. 1-8519).
|
(10.53)*
|
|
Amended and Restated Employment Agreement effective July 26, 2013 between Cincinnati Bell Inc. and Leigh R. Fox (Exhibit 10.2 to Current Report on Form 8-K, date of Report July 26, 2013, File No. 1-8519).
|
(10.54)*
|
|
Employment Agreement between Cincinnati Bell Inc. and David L. Heimbach dated as of November 20, 2013 (Exhibit 10.1 to Current Report on Form 8-K, date of earliest event reported November 20, 2013, File No. 1-8519).
|
(10.55)*
|
|
Employment Agreement dated as of May 5, 2014 between Cincinnati Bell Inc. and Joshua T. Duckworth (Exhibit 10.1 to Current Report on Form 8-K, date of Report May 5, 2014, 2014, File No. 1-8519).
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
(dollars in millions)
|
|
Beginning of Period
|
|
Charge (Benefit) to Expenses
|
|
To (from) Other Accounts
|
|
Deductions
|
|
End of Period
|
||||||||||
Allowance for Doubtful Accounts
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year 2015
|
|
$
|
12.4
|
|
|
$
|
8.5
|
|
|
$
|
—
|
|
|
$
|
8.5
|
|
|
$
|
12.4
|
|
Year 2014
|
|
$
|
12.2
|
|
|
$
|
10.4
|
|
|
$
|
—
|
|
|
$
|
10.2
|
|
|
$
|
12.4
|
|
Year 2013
|
|
$
|
13.3
|
|
|
$
|
11.3
|
|
|
$
|
—
|
|
|
$
|
12.4
|
|
|
$
|
12.2
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deferred Tax Valuation Allowance
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year 2015
|
|
$
|
64.4
|
|
|
$
|
(5.5
|
)
|
|
$
|
(0.5
|
)
|
|
$
|
—
|
|
|
$
|
58.4
|
|
Year 2014
|
|
$
|
68.3
|
|
|
$
|
(1.1
|
)
|
|
$
|
(2.8
|
)
|
|
$
|
—
|
|
|
$
|
64.4
|
|
Year 2013
|
|
$
|
56.8
|
|
|
$
|
14.1
|
|
|
$
|
(2.6
|
)
|
|
$
|
—
|
|
|
$
|
68.3
|
|
Form 10-K Part IV
|
|
Cincinnati Bell Inc.
|
|
|
|
|
|
Date:
|
February 25, 2016
|
|
/s/ Leigh R. Fox
|
|
|
|
|
Leigh R. Fox
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
|
Date:
|
February 25, 2016
|
|
/s/ Joshua T. Duckworth
|
|
|
|
|
Joshua T. Duckworth
|
|
|
|
|
Chief Accounting Officer
|
|
Form 10-K Part IV
|
|
Cincinnati Bell Inc.
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
/s/ Theodore H. Torbeck
|
|
President, Chief Executive Officer and Director
|
|
February 25, 2016
|
|
Theodore H. Torbeck
|
|
|
|
|
|
|
|
|
|
|
|
Phillip R. Cox*
|
|
Chairman of the Board and Director
|
|
February 25, 2016
|
|
Phillip R. Cox
|
|
|
|
|
|
|
|
|
|
|
|
John W. Eck*
|
|
Director
|
|
February 25, 2016
|
|
John W. Eck
|
|
|
|
|
|
|
|
|
|
|
|
Jakki L. Haussler*
|
|
Director
|
|
February 25, 2016
|
|
Jakki L. Haussler
|
|
|
|
|
|
|
|
|
|
|
|
Craig F. Maier*
|
|
Director
|
|
February 25, 2016
|
|
Craig F. Maier
|
|
|
|
|
|
|
|
|
|
|
|
Russel P. Mayer*
|
|
Director
|
|
February 25, 2016
|
|
Russel P. Mayer
|
|
|
|
|
|
|
|
|
|
|
|
Lynn A. Wentworth*
|
|
Director
|
|
February 25, 2016
|
|
Lynn A. Wentworth
|
|
|
|
|
|
|
|
|
|
|
|
Martin J. Yudkovitz*
|
|
Director
|
|
February 25, 2016
|
|
Martin J. Yudkovitz
|
|
|
|
|
|
|
|
|
|
|
|
John M. Zrno*
|
|
Director
|
|
February 25, 2016
|
|
John M. Zrno
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*By: /s/ Theodore H. Torbeck
|
|
|
|
|
|
Theodore H. Torbeck
|
|
|
|
|
|
as attorney-in-fact and on his behalf
|
|
|
|
||
as Principal Executive Officer, President, Chief Executive Officer and Director
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CINCINNATI BELL, INC
|
|
|
|
|
By:
/s/ Christopher J. Wilson
|
|
|
|
|
Title:
Vice President, General Counsel and Secretary
|
|
|
|
|
Date:
May 1, 2015
|
|
|
|
|
|
|
|
|
Name of Employee:
|
________________________________
|
Award Date:
|
________________________________
|
Number of Restricted Stock Units:
|
________________________________
|
|
|
TO THE COMPANY:
|
Cincinnati Bell, Inc.
|
|
221 East Fourth Street
|
|
Cincinnati, Ohio 45202
|
|
Attention: Secretary of the Compensation Committee
|
|
|
|
|
EMPLOYEE:
|
|
CINCINNATI BELL, INC.
|
|
|
|
|
|
________________________________
|
|
_______________________________
|
|
|
|
|
|
|
|
Phillip R. Cox
|
|
|
|
Chairman, Board of Directors
|
|
|
|
|
|
Date:
ACCEPTANCE DATE
|
|
Date:
January 28, 2016
|
|
|
|
Year ended December 31
|
||||||||||||||||||
(dollars in millions)
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Pre-tax income from continuing operations in consolidated subsidiaries plus fixed charges*
|
|
$
|
586.4
|
|
|
$
|
384.8
|
|
|
$
|
139.0
|
|
|
$
|
206.1
|
|
|
$
|
254.0
|
|
Fixed charges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expensed and capitalized
|
|
104.2
|
|
|
146.7
|
|
|
176.6
|
|
|
213.9
|
|
|
208.9
|
|
|||||
Appropriate portions of rentals
|
|
3.4
|
|
|
2.5
|
|
|
2.3
|
|
|
4.3
|
|
|
4.7
|
|
|||||
Total fixed charges
|
|
107.6
|
|
|
149.2
|
|
|
178.9
|
|
|
218.2
|
|
|
213.6
|
|
|||||
Pre-tax income required to pay preferred dividends
|
|
16.1
|
|
|
17.6
|
|
|
11.7
|
|
|
6.2
|
|
|
24.5
|
|
|||||
Total combined fixed charges and preferred dividends
|
|
$
|
123.7
|
|
|
$
|
166.8
|
|
|
$
|
190.6
|
|
|
$
|
224.4
|
|
|
$
|
238.1
|
|
Ratio of earnings to fixed charges
|
|
5.4
|
|
|
2.6
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
|||||
Coverage deficiency**
|
|
n/a
|
|
|
n/a
|
|
|
39.9
|
|
|
12.1
|
|
|
n/a
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of earnings to combined fixed charges and preferred dividends
|
|
4.7
|
|
|
2.3
|
|
|
—
|
|
|
—
|
|
|
1.1
|
|
|||||
Coverage deficiency**
|
|
n/a
|
|
|
n/a
|
|
|
$
|
51.6
|
|
|
$
|
18.3
|
|
|
n/a
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
* Earnings used in computing the ratio of earnings to combined fixed charges and preferred dividends consists of income from continuing operations before income taxes, adjusted to exclude loss from equity method investees and fixed charges except for capitalized interest, and adjusted to include dividends received from equity method investees.
|
||||||||||||||||||||
** For the period in which a coverage deficiency is presented, earnings were inadequate to cover fixed charges or combined fixed charges and preferred dividends by the amount of the deficiency.
|
Subsidiary Name
|
|
State or Country of Incorporation or Formation
|
Cincinnati Bell Telephone Company LLC
|
|
Ohio
|
Cincinnati Bell Telecommunications Services LLC
|
|
Ohio
|
Cincinnati Bell Extended Territories LLC
|
|
Ohio
|
Cincinnati Bell Entertainment Inc.
|
|
Ohio
|
Cincinnati Bell Wireless LLC
|
|
Ohio
|
Cincinnati Bell Any Distance Inc.
|
|
Delaware
|
Cincinnati Bell Technology Solutions Inc.
|
|
Delaware
|
Cincinnati Bell Funding LLC
|
|
Delaware
|
CBTS Software LLC
|
|
Delaware
|
Cincinnati Bell Shared Services LLC
|
|
Ohio
|
CBTS Canada Inc.
|
|
Canada
|
Cincinnati Bell Technology Solutions UK Limited
|
|
United Kingdom
|
eVolve Business Solutions LLC
|
|
Ohio
|
Cincinnati Bell Any Distance of Virginia LLC
|
|
Virginia
|
Data Center Investments Inc.
|
|
Delaware
|
Data Center Investments Holdco LLC
|
|
Delaware
|
Data Centers South Inc.
|
|
Delaware
|
Data Centers South Holdings LLC
|
|
Delaware
|
CBMSM Inc.
|
|
New York
|
/s/ Phillip R. Cox
|
Phillip R. Cox
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ John W. Eck
|
John W. Eck
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ Jakki L. Haussler
|
Jakki L. Haussler
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ Craig F. Maier
|
Craig F. Maier
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ Russel P. Mayer
|
Russel P. Mayer
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ Lynn A. Wentworth
|
Lynn A. Wentworth
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ Martin J. Yudkovitz
|
Martin J. Yudkovitz
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
/s/ John M. Zrno
|
John M. Zrno
|
Director
|
STATE OF OHIO
|
)
|
|
) SS:
|
COUNTY OF HAMILTON
|
)
|
/s/ Susan D. McClarnon
|
Susan D. McClarnon
|
Notary Public, State of Ohio
|
My commission expires 03-16-2018
|
1.
|
I have reviewed this annual report on Form 10-K of Cincinnati Bell Inc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure control and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
February 25, 2016
|
/s/ Theodore H. Torbeck
|
|
|
Theodore H. Torbeck
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of Cincinnati Bell Inc;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure control and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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February 25, 2016
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/s/ Leigh R. Fox
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Leigh R. Fox
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Chief Financial Officer
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Theodore H. Torbeck
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Theodore H. Torbeck
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President and Chief Executive Officer
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February 25, 2016
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Leigh R. Fox
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Leigh R. Fox
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Chief Financial Officer
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February 25, 2016
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