EXHIBIT 99.3.1
RICHMOND MAJOR TRADING AREA
BALANCE SHEETS
(Dollars in thousands)
June 30, 2000 December 31,
(Unaudited) 1999
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ASSETS
Current Assets:
Cash and cash equivalents $ 188 $ 422
Accounts receivable, net of allowance for doubtful accounts of 4,823 4,433
$1,193 and $1,165, respectively
Accounts receivable, other 355 258
Inventory, finished goods 792 1,461
Prepaid assets 860 541
Other 244 50
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Total current assets 7,262 7,165
--------- ---------
PCS Licenses, net of accumulated amortization of $2,122 and $1,833, 21,029 21,318
respectively
Microwave relocation, net of accumulated amortization of $827 and $718, 7,926 8,050
respectively
Property, plant and equipment, net 106,956 101,107
Construction in progress 4,509 4,985
Other 596 589
--------- ---------
Total assets $148,278 $143,214
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LIABILITIES AND EQUITY
Current Liabilities:
Current installments of capital leases $ 3,874 $ 3,742
Accounts payable and accrued expenses 5,122 9,857
Accrued compensation 441 438
Taxes, other than income 2,307 2,046
--------- ---------
Total current liabilities 11,744 16,083
--------- ---------
Capital lease obligations, noncurrent 18,773 20,255
Other noncurrent liabilities 3,182 2,779
PrimeCo equity investment 114,579 104,097
--------- ---------
Total liabilities and equity $148,278 $143,214
========= =========
The accompanying notes are an integral part of the financial statements.
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RICHMOND MAJOR TRADING AREA
STATEMENTS OF OPERATIONS
For the Three and Six Months Ended June 30, 2000 and 1999
(Dollars in thousands)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2000 1999 2000 1999
-------------- -------------- -------------- ---------------
Revenues and sales:
Service revenues $ 12,001 $ 10,795 $ 23,454 $ 20,203
Product sales 1,080 1,491 2,465 3,662
Other 580 364 1,072 766
------ ------ ------ ------
Net revenue 13,661 12,650 26,991 24,631
Direct operating costs and expenses:
Cost of service 538 235 877 420
Cost of products sold 989 1,458 2,443 3,568
Operating expenses 11,422 12,838 25,102 26,527
Depreciation and amortization 3,814 3,437 6,925 6,785
------ ------ ------ ------
Total 16,763 17,968 35,347 37,300
------ ------ ------ ------
Loss from operations (3,102) (5,318) (8,356) (12,669)
Interest expense, less capitalized interest of $28 and (329) (378) (688) (750)
$24 for the three months ended June 30, 2000 and
1999 respectively ($46 and $106 for the six months
ended June 30, 2000 and 1999, respectively)
Loss on disposal of assets (67) (28) (43) (197)
------ ------ ------ ------
Net Loss $ (3,498) $ (5,724) $ (9,087) $ (13,616)
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The accompanying notes are an integral part of the financial statements.
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RICHMOND MAJOR TRADING AREA
STATEMENTS OF CASH FLOWS
For the Six Months Ended June 30, 2000 and 1999
(Dollars in thousands)
(Unaudited)
Six Months Ended
---------------- ---------------
June 30, June 30,
2000 1999
---------------- ---------------
Cash Flows From Operating Activities:
Net loss $ (9,087) $(13,616)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 6,925 6,785
Bad debt expense 424 480
Loss on disposal of assets 43 197
Changes in assets and liabilities from operations:
Accounts receivable, trade (814) (1,625)
Inventory 669 492
Prepaid assets (319) (268)
Other assets (298) 1,608
Accounts payable and accrued expenses (4,735) (238)
Accrued compensation 3 (464)
Taxes, other than income 261 941
Other noncurrent liabilities 403 111
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Net cash used in operating activities (6,525) (5,597)
-------- --------
Cash Flows From Investing Activities:
Payments for microwave relocation - -
Recoveries of microwave relocation costs 12 -
Additions to property, plant and equipment (11,940) (7,017)
-------- --------
Net cash used in investing activities (11,928) (7,017)
-------- --------
Cash Flows From Financing Activities:
Increase in intercompany payable 19,569 24,382
Reductions of capital leases (1,350) (1,212)
Payment of note payable to vendor - (10,396)
-------- --------
Net cash provided by financing activities 18,219 12,774
-------- --------
Increase (decrease) in cash and cash equivalents (234) 160
Cash and cash equivalents, beginning of period 422 -
-------- --------
Cash and cash equivalents, end of period $ 188 $ 160
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The accompanying notes are an integral part of the financial statements.
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RICHMOND MAJOR TRADING AREA
NOTES TO FINANCIAL STATEMENTS
(1) Business and Significant Accounting Policies:
The accompanying unaudited financial statements, in the opinion of the
PrimeCo Personal Communications, L.P. ("PrimeCo") management, contain all
material, normal and recurring adjustments necessary to present accurately the
financial condition of the Richmond Major Trading Area ("Richmond MTA") and the
results of its operations for the periods indicated. The results of operations
for the interim periods reported are not necessarily indicative of the results
to be experienced for the entire year.
These unaudited financial statements should be used in conjunction with
the financial statements and notes thereto for the year ended December
31, 1999. Significant accounting policies followed by the Richmond MTA
were disclosed in the notes to the Richmond MTA's financial statements
for the year ended December 31, 1999. The year-end balance sheet data
included within was derived from the audited financial statements, but
does not include all of the disclosures required by generally accepted
accounting principles.
Business
The Richmond MTA of PrimeCo design, builds, and operates broadband
personal communications services ("PCS") under the PCS license awarded to
PrimeCo in the Richmond, Virginia Market.
Litigation
PrimeCo is involved in various claims and legal proceedings of a nature
considered normal to its business. Management believes that these will not have
a material effect on the Richmond MTA's operating results or financial position.
(2) Ownership:
Effective April 3, 2000, in order to comply with Federal Communications
Commission ("FCC") regulations regarding overlap properties, the operations of
the Richmond MTA were contributed by PrimeCo to PrimeCo PCS, LP., a separate
legal entity jointly controlled by Bell Atlantic Corporation and Vodafone
AirTouch.
(3) Subsequent Events:
On July 26, 2000, PrimeCo closed on the disposition to CFW
Communications Company of PrimeCo Personal Communications, L.P. PCS licenses,
assets and operations in the Richmond MTA for cash of $408.6 million, the
assumption of approximately $20.0 million of lease obligations and the transfer
of a limited partnership interest and the assets, licenses and operations of
analog wireless operations, with a combined value of approximately $78.5
million.
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