EXHIBIT 99A.1
CONSOLIDATED STATEMENTS OF INCOME (1) (2) U S WEST, INC.
(UNAUDITED)
Quarter Ended Nine Months Ended
In millions, except September 30, % September 30, %
per share amounts 1999 1998 Change 1999 1998(3) Change
- ------------------------ ----- ----- ------- ----- -------- ------
OPERATING REVENUES
Local services $1,979 $1,805 9.6 $5,779 $5,291 9.2
Access services 688 660 4.2 2,057 1,996 3.1
Directory services 336 313 7.3 995 929 7.1
Long-distance services 141 202 (30.2) 471 606 (22.3)
Other services 173 132 31.1 455 352 29.3
----- ----- ------- ------
Total operating rev. 3,317 3,112 6.6 9,757 9,174 6.4
----- ----- ------- ------
OPERATING EXPENSES
Employee-related 1,195 1,104 8.2 3,473 3,179 9.2
Other operating 657 651 0.9 1,996 2,072 (3.7)
Depreciation & amort 588 558 5.4 1,763 1,625 8.5
----- ----- ------- ------
Total operating exp. 2,440 2,313 5.5 7,232 6,876 5.2
----- ----- ------- ------
OPERATING INCOME 877 799 9.8 2,525 2,298 9.9
Interest expense 203 172 18.0 519 495 4.8
Terminated merger-
related expenses 282 - - 282 - -
Other (income)expense (4) 19 - 10 77 (87.0)
----- ----- ------- ------
Income before
income taxes 396 608 (34.9) 1,714 1,726 (0.7)
Income tax provision(4) 257 229 12.2 757 658 15.0
----- ----- ------- ------
NET INCOME $ 139 $ 379 (63.3) $ 957 $1,068 (10.4)
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Basic earnings
per share $ 0.28 $ 0.76 (63.2) $ 1.90 $ 2.13 (10.8)
===== ===== ======= ======
Basic average shares
outstanding 504.8 501.8 0.6 504.0 501.5 0.5
===== ===== ======= ======
Diluted earnings
per share $ 0.27 $ 0.75 (64.0) $ 1.88 $ 2.11 (10.9)
===== ===== ======= ======
Diluted average shares
outstanding 509.0 506.0 0.6 508.5 505.7 0.6
===== ===== ===== ======
<FN>
<F1>
(1) The separation of U S WEST, Inc. into two independent companies, U S
WEST,Inc.("New U S WEST") and MediaOne Group, Inc.,(the "Separation") occurred
on June 12, 1998. The results for the nine months ended September 30, 1998 give
effect to the Separation as if the business that comprised New U S WEST operated
as a separate entity for the entire period presented. Additionally, the results
of operations include pro forma adjustments for the assumption of indebtedness
and the issuance of shares in connection with the alignment of the directory
business with New U S WEST, as if the Separation had been consummated as of the
beginning of the period indicated.
<F2>
(2) Net income for the three and nine months ended September 30, 1999 includes
$282 of after tax charges associated with terminating the Global Crossing
merger.
<F3>
(3) Net income for the nine months ended September 30, 1998 includes $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.
<F4>
(4) The disproportionate tax rate for the three and nine months ended September
30, 1999, results from the deductibility of the terminated merger-related
expenses being subject to review.
</FN>