CONSOLIDATED STATEMENTS OF OPERATIONS U S WEST COMMUNICATIONS, INC.
(UNAUDITED) (Telephone Operations Only)
Quarter Ended Six Months Ended
June 30, % June 30, %
In millions 1999 1998 (1) Change 1999 1998 (1) Change
- -------------------------- ------- ------- ------ ------ ------- ------
OPERATING REVENUES
Local service $ 1,933 $ 1,756 10.1 $ 3,800 $ 3,486 9.0
Access services 688 671 2.5 1,369 1,336 2.5
Long-distance services 150 195 (23.1) 321 396 (18.9)
Other services 78 73 6.8 152 146 4.1
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Total operating revenues 2,849 2,695 5.7 5,642 5,364 5.2
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OPERATING EXPENSES
Employee-related 891 860 3.6 1,784 1,682 6.1
Other operating (1) 658 611 7.7 1,287 1,215 5.9
Depreciation & amort 557 518 7.5 1,142 1,036 10.2
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Total operating expenses 2,106 1,989 5.9 4,213 3,933 7.1
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Operating income 743 706 5.2 1,429 1,431 (0.1)
Interest expense 98 94 4.3 187 185 1.1
Other expense 12 29 (58.6) 24 56 (57.1)
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Income before income
taxes 633 583 8.6 1,218 1,190 2.4
Income tax provision 246 218 12.8 462 451 2.4
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NET INCOME $ 387 $ 365 6.0 $ 756 $ 739 2.3
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<FN>
<F1>
(1) Net income for the quarter and six months ended June 30, 1998 excludes $89
of after tax charges associated with the Separation and an asset impairment,
consisting of $129 of other operating expense, net of $40 of income tax expense.
</FN>