FOR IMMEDIATE RELEASE FOR MORE INFORMATION CONTACT:
October 27, 2005 Media: Patricia Cameron 318.388.9674
patricia.cameron@centurytel.com
Investors: Tony Davis 318.388.9525
tony.davis@centurytel.com
CenturyTel Reports Third Quarter Earnings
Monroe, La. . . CenturyTel, Inc. (NYSE: CTL) announces operating results for
third quarter 2005.
o Operating revenues, excluding nonrecurring items, increased 8.2% to $657.1
million from $607.4 million. Reported under GAAP, operating revenues
increased 8.8% to $657.1 million from $603.9 million.
o Operating cash flow (as defined in the attached financial schedules),
excluding nonrecurring items, was $340.6 million.
o Net income, excluding nonrecurring items, was $99.0 million compared to
$81.1 million in third quarter 2004. Net income, reported under GAAP, was
$91.4 million compared to $86.2 million in third quarter 2004.
o Diluted earnings per share, excluding nonrecurring items, was $.74 in third
quarter 2005 and $.59 in third quarter 2004, while GAAP diluted earnings
per share was $.68 in third quarter 2005 and $.63 in third quarter 2004.
o Free cash flow (as defined in the attached financial schedules), excluding
nonrecurring items, was $127.5 million in third quarter 2005.
--------------------------------------------------
Third Quarter Highlights Quarter Ended Quarter Ended % Change
(Excluding nonrecurring items) 9/30/05 9/30/04
(In thousands, except per share
amounts and customer units)
- --------------------------------------------------------------------------------
Operating Revenues (1) $ 657,085 $ 607,392 8.2%
Operating Cash Flow (2) $ 340,621 $ 308,239 10.5%
Net Income $ 98,977 $ 81,135 22.0%
Diluted Earnings Per Share $ .74 $ .59 25.4%
Average Diluted Shares Outstanding 135,916 139,816 (2.8)%
Capital Expenditures $ 105,044 $ 97,583 7.6%
-----------------------------------------
Telephone Access Lines 2,250,416 2,336,517 (3.7)%
Long Distance Lines 1,142,209 1,037,293 10.1%
DSL Connections 219,879 120,869 81.9%
-----------------------------------------
(1) Third quarter 2005 Operating Revenues increased approximately $34.2
million compared to third quarter 2004 due to the recognition of prior
period revenue settlements.
(2) Operating Cash Flow is a non-GAAP financial measure. A reconciliation
of this item to comparable GAAP measures is included in the attached
financial schedules.
"We continue to see strong demand for broadband and fiber transport
services in our markets," Glen F. Post, III, chairman and chief executive
officer, said. "The mid-year addition of the KMC metro fiber assets and
continued solid internal growth in our LightCore operations drove revenue growth
of $17.2 million, a 90% increase in fiber transport and CLEC revenues since
third quarter 2004."
Operating revenues, excluding nonrecurring items, rose 8.2% to $657.1
million in third quarter 2005 from $607.4 million in third quarter 2004. Revenue
increases aggregating $56 million resulted primarily from approximately $13.8
million of revenues generated by the metro fiber assets acquired in second
quarter 2005, $34.2 million related to adjustments to recognize prior period
revenue settlements, and data revenue growth from DSL subscribers. These
increases more than offset revenue declines of $10.2 million attributable to
previously anticipated lower intrastate toll revenues, universal service funding
and access line losses.
Operating expenses, excluding nonrecurring items, increased 5.6% to $450.0
million from $426.2 million in third quarter 2004 due primarily to the fiber
assets acquired during second quarter 2005 and strong growth in the broadband
business.
"One of our key strategies is to be the broadband provider of choice in our
markets. We continued to make progress in this area as we added more than 25,000
DSL connections during the third quarter, more than double the 12,000 added in
third quarter 2004," Post said.
Operating cash flow, excluding nonrecurring items, increased 10.5% to
$340.6 million from $308.2 million. CenturyTel achieved an operating cash flow
margin, excluding nonrecurring items, of 51.8% during the quarter versus 50.7%
in third quarter 2004.
Net income, excluding nonrecurring items, was $99.0 million compared to
$81.1 million in third quarter 2004. Diluted earnings per share, excluding
nonrecurring items, was $.74 in third quarter 2005 and $.59 in third quarter
2004.
As of October 26, 2005, approximately 82% of the 12.9 million shares under
the Company's accelerated share repurchase agreements had been repurchased at a
weighted average price per share of approximately $34.50.
For the first nine months of 2005, operating revenues, excluding
nonrecurring items, increased to $1.859 billion from $1.805 billion for the same
period in 2004, a 3.0% increase. Operating cash flow, excluding nonrecurring
items, was $966.0 million for 2005 compared to $939.5 million a year ago.
Operating income, excluding nonrecurring items, increased to $569.8 million from
$554.6 million in 2004.
Under generally accepted accounting principles (GAAP), net income for third
quarter 2005 was $91.4 million compared to $86.2 million for third quarter 2004.
Diluted earnings per share for third quarter 2005 and 2004 was $.68 and $.63,
respectively. For the first nine months of 2005 and 2004, net income was $256.1
million and $252.8 million, respectively, while diluted earnings per share was
$1.91 and $1.79, respectively. As explained further in the attached financial
schedules, third quarter 2005 results reflect a net after-tax charge of $7.6
million from expenses associated with Hurricanes Katrina and Rita and
transactions related to certain non-operating investments. Third quarter 2004
results reflect an after-tax $6.0 million adjustment for over depreciated assets
and the related revenue effect. Other nonrecurring items that affected the third
quarters and first nine months of 2005 and 2004 are detailed in the accompanying
financial information.
Outlook. For fourth quarter 2005, CenturyTel expects total revenues of $610
to $620 million and diluted earnings per share of $.52 to $.56. As a result of
better than anticipated third quarter performance, the Company has increased and
narrowed the range of anticipated full year 2005 diluted earnings per share
guidance to $2.49 to $2.53. All outlook figures provided under this section are
presented excluding the potential impact of any future mergers, acquisitions,
divestitures, share repurchases or other unusual events.
CenturyTel expects to provide full year 2006 earnings per share guidance in
January 2006. The Company has, however, identified several items that can be
expected to affect 2006 results when compared to 2005. Increased national
average loop costs are expected to negatively impact the Company's 2006
Universal Service Fund receipts and diluted earnings per share by $.06 to $.08.
Revenue settlements related to prior periods are anticipated to decline and
negatively impact 2006 diluted earnings per share by $.14 to $.18. The change in
accounting for stock options is anticipated to negatively impact 2006 diluted
earnings per share by $.05 to $.06. CenturyTel currently expects lower 2006
interest expense to contribute $.03 to $.05 to 2006 diluted earnings per share.
Upon completion of its accelerated share repurchase program later this year, the
Company currently anticipates completing the remaining $86 million outstanding
under its $200 million share repurchase program. Additionally, CenturyTel
believes it will continue to drive growth in its broadband and fiber transport
businesses. These and other items that may affect 2006 results will be discussed
further during the Company's fourth quarter 2005 earnings call in early 2006.
Reconciliation to GAAP. This release includes certain non-GAAP financial
measures, including but not limited to operating cash flow, free cash flow and
adjustments to GAAP measures to exclude the effect of nonrecurring items. In
addition to providing key metrics for management to evaluate the Company's
performance, we believe these measurements assist readers in their understanding
of period-to-period operating performance and in identifying historical and
prospective trends. Reconciliations of non-GAAP financial measures to the most
comparable GAAP measures are included in the attached financial statements.
Reconciliation of additional non-GAAP financial measures that may be discussed
during the earnings call described below will be available in the Investor
Relations portion of the Company's Web site at www.centurytel.com. Investors are
urged to consider these non-GAAP measures in addition to, and not in
substitution for, measures prepared in accordance with GAAP.
Investor Call. As previously announced, CenturyTel's management will host a
conference call at 10:30 a.m. Central Time today. Interested parties can access
the call by dialing 866.259.7123. The call will be accessible for replay through
November 2, 2005, by calling 888.266.2081 and entering the conference ID number
788978. Investors can also listen to CenturyTel's earnings conference call and
replay by accessing the Investor Relations portion of the Company's Web site at
www.centurytel.com prior to November 16, 2005.
In addition to historical information, this release includes certain
forward-looking statements, estimates and projections that are based on current
expectations only, and are subject to a number of risks, uncertainties and
assumptions, many of which are beyond the control of the Company. Actual events
and results may differ materially from those anticipated, estimated or projected
if one or more of these risks or uncertainties materialize, or if underlying
assumptions prove incorrect. Factors that could affect actual results include
but are not limited to: the timing, success and overall effects of competition
from a wide variety of competitive providers; the risks inherent in rapid
technological change; the effects of ongoing changes in the regulation of the
communications industry; the Company's ability to effectively manage its growth,
including integrating newly-acquired businesses into the Company's operations
and hiring adequate numbers of qualified staff; possible changes in the demand
for, or pricing of, the Company's products and services; the Company's ability
to successfully introduce new product or service offerings on a timely and
cost-effective basis; the Company's ability to collect its receivables from
financially troubled communications companies; the Company's ability to
successfully negotiate collective bargaining agreements on reasonable terms;
other risks referenced from time to time in the Company's filings with the
Securities and Exchange Commission; and the effects of more general factors such
as changes in interest rates, in accounting policies or practices, in operating,
medical or administrative costs, in general market, labor or economic
conditions, or in legislation, regulation or public policy. These and other
uncertainties related to the Company's business are described in greater detail
in the Company's Annual Report on Form 10-K for the year ended December 31,
2004. You should be aware that new factors may emerge from time to time and it
is not possible for management to identify all such factors, nor can it predict
the impact of each such factor on the business or the extent to which any one or
more factors may cause actual results to differ from those reflected in any
forward-looking statements. You are further cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date of
this release. The information contained in this release is as of October 27,
2005. The Company undertakes no obligation to update any of its forward-looking
statements for any reason.
CenturyTel (NYSE: CTL) delivers advanced communications with a personal
touch. The Company, included in the S&P 500 Index, is a leading provider of
consumer and business communications solutions in rural areas and small to
mid-size cities in 26 states. Visit CenturyTel at www.centurytel.com.
--------------------------------------------
CenturyTel, Inc.
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
Three months ended September 30, 2005 Three months ended September 30, 2004
------------------------------------- -------------------------------------
As adjusted As adjusted Increase
Less excluding Less excluding (decrease)
non- non- non- non- Increase excluding
In thousands, except As recurring recurring As recurring recurring (decrease) nonrecurring
per share amounts reported items items reported items items as reported items
------------ --------- ------------ ---------- ----------- ------------ ----------- ------------
OPERATING REVENUES
Local service $ 176,069 176,069 179,793 179,793 (2.1%) (2.1%)
Network access 257,586 257,586 237,522 (3,091)(4) 240,613 8.4% 7.1%
Long distance 49,788 49,788 49,743 49,743 0.1% 0.1%
Data 88,911 88,911 69,570 (422)(4) 69,992 27.8% 27.0%
Fiber transport and CLEC 36,361 36,361 19,113 19,113 90.2% 90.2%
Other 48,370 48,370 48,138 48,138 0.5% 0.5%
------------ --------- ------------ ---------- ----------- ------------
657,085 - 657,085 603,879 (3,513) 607,392 8.8% 8.2%
------------ --------- ------------ ---------- ----------- ------------
OPERATING EXPENSES
Cost of services
and products 222,724 5,853 (1) 216,871 191,000 191,000 16.6% 13.5%
Selling, general
and administrative 99,593 99,593 108,153 108,153 (7.9%) (7.9%)
Depreciation and
amortization 133,526 133,526 113,857 (13,221)(4) 127,078 17.3% 5.1%
------------ --------- ------------ ---------- ----------- ------------
455,843 5,853 449,990 413,010 (13,221) 426,231 10.4% 5.6%
------------ --------- ------------ ---------- ----------- ------------
OPERATING INCOME 201,242 (5,853) 207,095 190,869 9,708 181,161 5.4% 14.3%
OTHER INCOME (EXPENSE)
Interest expense (49,904) (49,904) (52,174) (52,174) (4.4%) (4.4%)
Income from unconsolidated
cellular entity 1,270 1,270 1,929 1,929 (34.2%) (34.2%)
Other income and expense (4,214) (6,429)(2) 2,215 (822) (1,500)(5) 678 412.7% 226.7%
Income tax expense (56,983) 4,716 (3) (61,699) (53,610) (3,151)(6) (50,459) 6.3% 22.3%
------------ --------- ------------ ---------- ----------- ------------
NET INCOME $ 91,411 (7,566) 98,977 86,192 5,057 81,135 6.1% 22.0%
============ ========= ============ ========== =========== ============
BASIC EARNINGS PER SHARE $ 0.70 (0.06) 0.76 0.64 0.04 0.60 9.4% 26.7%
DILUTED EARNINGS PER SHARE $ 0.68 (0.06) 0.74 0.63 0.04 0.59 7.9% 25.4%
SHARES OUTSTANDING
Basic 130,150 130,150 134,885 134,885 (3.5%) (3.5%)
Diluted 135,916 135,916 139,816 139,816 (2.8%) (2.8%)
DIVIDENDS PER COMMON SHARE $ 0.0600 0.0600 0.0575 0.0575 4.3% 4.3%
NONRECURRING ITEMS
(1) - Expenses associated with Hurricanes Katrina and Rita.
(2) - Includes (i) $9.9 million impairment of non-operating investment, net
of (ii) $3.5 million gain on sale of a separate non-operating
investment.
(3) - Tax effect of items (1) and (2).
(4) - Adjustment for overdepreciated assets, including related revenue
effect.
(5) - Impairment of non-operating investment.
(6) - Tax effect of items (4) and (5).
CenturyTel, Inc.
CONSOLIDATED STATEMENTS OF INCOME
NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
(UNAUDITED)
Nine months ended September 30, 2005 Nine months ended September 30, 2004
------------------------------------ ------------------------------------
As adjusted As adjusted Increase
Less excluding Less excluding (decrease)
non- non- non- non- Increase excluding
In thousands, except As recurring recurring As recurring recurring (decrease) nonrecurring
per share amounts reported items items reported items items as reported items
----------- --------- ------------ ---------- ----------- ----------- ----------- ------------
OPERATING REVENUES
Local service $ 530,319 530,319 537,993 537,993 (1.4%) (1.4%)
Network access 727,268 727,268 723,994 (3,091)(5) 727,085 0.5% 0.0%
Long distance 141,746 141,746 140,059 140,059 1.2% 1.2%
Data 237,866 237,866 203,367 (422)(5) 203,789 17.0% 16.7%
Fiber transport and CLEC 78,240 78,240 54,866 54,866 42.6% 42.6%
Other 143,341 143,341 140,859 140,859 1.8% 1.8%
----------- --------- ------------ ---------- ----------- ------------
1,858,780 - 1,858,780 1,801,138 (3,513) 1,804,651 3.2% 3.0%
----------- --------- ------------ ---------- ----------- ------------
OPERATING EXPENSES
Cost of services
and products 609,590 5,853 (1) 603,737 562,775 562,775 8.3% 7.3%
Selling, general and
administrative 289,053 289,053 302,426 302,426 (4.4%) (4.4%)
Depreciation and
amortization 396,153 396,153 371,600 (13,221)(5) 384,821 6.6% 2.9%
----------- --------- ------------ ---------- ----------- ------------
1,294,796 5,853 1,288,943 1,236,801 (13,221) 1,250,022 4.7% 3.1%
----------- --------- ------------ ---------- ----------- ------------
OPERATING INCOME 563,984 (5,853) 569,837 564,337 9,708 554,629 (0.1%) 2.7%
OTHER INCOME (EXPENSE)
Interest expense (152,176) (1,196)(2) (150,980) (157,806) (157,806) (3.6%) (4.3%)
Income from unconsolidated
cellular entity 3,307 3,307 6,114 6,114 (45.9%) (45.9%)
Other income and expense (1,459) (8,003)(3) 6,544 (2,329) (1,500)(6) (829) (37.4%) (889.4%)
Income tax expense (157,511) 7,111 (4) (164,622) (157,561) (3,151)(7) (154,410) (0.0%) 6.6%
----------- --------- ------------ ---------- ----------- ------------
NET INCOME $ 256,145 (7,941) 264,086 252,755 5,057 247,698 1.3% 6.6%
=========== ========= ============ ========== =========== ============
BASIC EARNINGS PER SHARE $ 1.95 (0.06) 2.02 1.82 0.04 1.79 7.1% 12.8%
DILUTED EARNINGS PER SHARE $ 1.91 (0.06) 1.97 1.79 0.04 1.75 6.7% 12.6%
SHARES OUTSTANDING
Basic 130,877 130,877 138,512 138,512 (5.5%) (5.5%)
Diluted 136,143 136,143 143,403 143,403 (5.1%) (5.1%)
DIVIDENDS PER COMMON SHARE $ 0.1800 0.1800 0.1725 0.1725 4.3% 4.3%
NONRECURRING ITEMS
(1) - Expenses associated with Hurricanes Katrina and Rita.
(2) - Write-off of unamortized deferred debt costs associated with purchasing
and retiring approximately $400 million of Series J notes.
(3) - Includes (i) a $9.9 million impairment of non-operating investment and
a $4.8 million debt extinguishment charge related to purchasing and
retiring approximately $400 million of Series J notes, net of (ii) a
$3.5 million gain on sale of non-operating investment and $3.2 million
of interest income related to the settlement of various income tax
audits.
(4) - Includes (i) $1.3 million tax benefit related to the settlement of
various income tax audits, and (ii) $5.8 million net tax benefit of
items (1), (2) and (3).
(5) - Adjustment for overdepreciated assets, including related revenue
effect.
(6) - Impairment of non-operating investment.
(7) - Tax effect of items (5) and (6).
CenturyTel, Inc.
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 2005 AND DECEMBER 31, 2004
(UNAUDITED)
September 30, December 31,
2005 2004
---------------- ----------------
(in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 268,501 167,215
Other current assets 259,850 252,632
---------------- ----------------
Total current assets 528,351 419,847
---------------- ----------------
NET PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment 7,699,418 7,431,017
Accumulated depreciation (4,400,303) (4,089,616)
---------------- ----------------
Net property, plant and equipment 3,299,115 3,341,401
---------------- ----------------
GOODWILL AND OTHER ASSETS
Goodwill 3,432,623 3,433,864
Other 582,447 601,841
---------------- ----------------
Total goodwill and other assets 4,015,070 4,035,705
---------------- ----------------
TOTAL ASSETS $ 7,842,536 7,796,953
================ ================
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Current maturities of long-term debt $ 334,576 249,617
Other current liabilities 472,991 442,001
---------------- ----------------
Total current liabilities 807,567 691,618
LONG-TERM DEBT 2,500,270 2,762,019
DEFERRED CREDITS AND OTHER LIABILITIES 979,264 933,551
STOCKHOLDERS' EQUITY 3,555,435 3,409,765
---------------- ----------------
TOTAL LIABILITIES AND EQUITY $ 7,842,536 7,796,953
================ ================
CenturyTel, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Three months ended September 30, 2005 Three months ended September 30, 2004
--------------------------------------- -----------------------------------------
As adjusted As adjusted
Less excluding Less excluding
non- non- non- non-
In thousands As recurring recurring As recurring recurring
reported items items reported items items
----------------------- ------------- ------------------------ --------------
Operating cash flow and
cash flow margin
Operating income $ 201,242 (5,853)(1) 207,095 190,869 9,708 (3) 181,161
Add: Depreciation and
amortization 133,526 - 133,526 113,857 (13,221)(3) 127,078
------------ ---------- ------------- ------------ ----------- --------------
Operating cash flow $ 334,768 (5,853) 340,621 304,726 (3,513) 308,239
============ ========== ============= ============ =========== ==============
Revenues $ 657,085 - 657,085 603,879 (3,513)(3) 607,392
============ ========== ============= ============ =========== ==============
Operating income margin
(operating income
divided by revenues) 30.6% 31.5% 31.6% 29.8%
============ ============= ============ ==============
Operating cash flow margin
(operating cash flow
divided by revenues) 50.9% 51.8% 50.5% 50.7%
============ ============= ============ ==============
Free cash flow (prior to debt
service requirements and
dividends)
Net income $ 91,411 (7,566)(2) 98,977 86,192 5,057 (4) 81,135
Add: Depreciation and
amortization 133,526 - 133,526 113,857 (13,221)(3) 127,078
Less: Capital expenditures (105,044) - (105,044) (97,583) - (97,583)
------------ ---------- ------------- ------------ ----------- --------------
Free cash flow $ 119,893 (7,566) 127,459 102,466 (8,164) 110,630
============ ========== ============= ============ =========== ==============
Free cash flow $ 119,893 102,466
Income from unconsolidated
cellular entity (1,270) (1,929)
Deferred income taxes 7,471 18,370
Changes in current assets
and current liabilities 10,413 13,622
(Increase) decrease in other
noncurrent assets 535 (4,401)
Increase (decrease) in other
noncurrent liabilities 3,080 (1,152)
Retirement benefits 1,472 5,137
Other, net 7,818 2,740
Add: Capital expenditures 105,044 97,583
------------ ------------
Net cash provided by
operating activities $ 254,456 232,436
============ ============
NONRECURRING ITEMS
(1) - Expenses associated with Hurricanes Katrina and Rita (presented on
a pre-tax basis).
(2) - Includes (i) a $6.1 million after-tax impairment of non-operating
investment and a $3.6 million after-tax expense associated with
Hurricanes Katrina and Rita, net of (ii) a $2.2 million after-tax gain
on sale of a separate non-operating investment.
(3) - Adjustment for overdepreciated assets, including related revenue
effect (presented on a pre-tax basis).
(4) - Adjustment for overdepreciated assets, including related revenue
effect, and impairment of non-operating investment (presented on an
after-tax basis).
CenturyTel, Inc.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Nine months ended September 30, 2005 Nine months ended September 30, 2004
--------------------------------------- -----------------------------------------
As adjusted As adjusted
Less excluding Less excluding
non- non- non- non-
In thousands As recurring recurring As recurring recurring
reported items items reported items items
----------------------- ------------- ------------------------ --------------
Operating cash flow and cash
flow margin
Operating income $ 563,984 (5,853)(1) 569,837 564,337 9,708 (3) 554,629
Add: Depreciation and
amortization 396,153 - 396,153 371,600 (13,221)(3) 384,821
------------ ---------- ------------- ------------ ----------- --------------
Operating cash flow $ 960,137 (5,853) 965,990 935,937 (3,513) 939,450
============ ========== ============= ============ =========== ==============
Revenues $ 1,858,780 - 1,858,780 1,801,138 (3,513)(3) 1,804,651
============ ========== ============= ============ =========== ==============
Operating income margin
(operating income divided
by revenues) 30.3% 30.7% 31.3% 30.7%
============ ============= ============ ==============
Operating cash flow margin
(operating cash flow divided
by revenues) 51.7% 52.0% 52.0% 52.1%
============ ============= ============ ==============
Free cash flow (prior to debt
service requirements and
dividends)
Net income $ 256,145 (7,941)(2) 264,086 252,755 5,057 (4) 247,698
Add: Depreciation and
amortization 396,153 - 396,153 371,600 (13,221)(3) 384,821
Less: Capital expenditures (281,958) - (281,958) (253,597) - (253,597)
------------ ---------- ------------- ------------ ----------- --------------
Free cash flow $ 370,340 (7,941) 378,281 370,758 (8,164) 378,922
============ ========== ============== ============ =========== ==============
Free cash flow $ 370,340 370,758
Income from unconsolidated
cellular entity (3,307) (6,114)
Deferred income taxes 33,418 75,408
Changes in current assets and
current liabilities 29,367 45,892
Increase in other noncurrent
assets (4,207) (26,555)
Increase (decrease) in other
noncurrent liabilities 2,496 (4,696)
Retirement benefits 13,989 23,000
Other, net 9,315 4,504
Add: Capital expenditures 281,958 253,597
------------ ------------
Net cash provided by
operating activities $ 733,369 735,794
============ ============
NONRECURRING ITEMS
(1) - Expenses associated with Hurricanes Katrina and Rita (presented on a
pre-tax basis).
(2) - Includes (i) a $6.1 million after-tax impairment of non-operating
investment, a $3.7 million after-tax expense related to purchasing
and retiring approximately $400 million of Series J notes and a $3.6
million after-tax expense associated with Hurricanes Katrina and
Rita, net of (ii) a $3.3 million net benefit related to the settlement
of various income tax audits and a $2.2 million after-tax gain on sale
of non-operating investment.
(3) - Adjustment for overdepreciated assets, including related revenue
effect (presented on a pre-tax basis).
(4) - Adjustment for overdepreciated assets, including related revenue
effect, and impairment of non-operating investment (presented on an
after-tax basis).