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Cincinnati Bell Delivers First Quarter Revenue and Earnings Growth

05/08/07
Increased Revenue and Profits From Wireless and Technology Solutions Provides Solid Start for 2007
CINCINNATI, May 08, 2007 (BUSINESS WIRE) -- Cincinnati Bell Inc. (NYSE:CBB) today announced results for the first quarter of 2007 including revenue of $315 million; operating income of $78 million; and net income of $23 million, or 8 cents per diluted share. Net income excluding special items(1), which is detailed in the attached financial information, was $23 million or 8 cents per diluted share, up $2 million or 7 percent from the first quarter of 2006 also excluding special items. Adjusted earnings before interest, taxes, depreciation and amortization(2) (EBITDA) equaled $117 million, up $5 million, or 4 percent from the first quarter of 2006.

"Cincinnati Bell's continued strong performance demonstrates that customers recognize our ability to provide them with superior value, reliable networks and outstanding service," said Jack Cassidy, president and chief executive officer of Cincinnati Bell Inc. "By maintaining a sharp focus on the fundamental metrics of our business, we were able to report improved results in the face of continued intense local competition."

First Quarter Highlights

-- Revenue totaled $315 million in the first quarter, up 6 percent from a year ago. Increased contributions from Technology Solutions, Wireless and data services more than offset a year-over-year decline in local voice revenue. Similarly, adjusted EBITDA equaled $117 million, up $5 million, or 4 percent from the first quarter of 2006 due to improved profitability in the Wireless and Technology Solutions operations.

-- Wireless service revenue increased $7 million or 12 percent from a year ago and the wireless EBITDA margin improved 6 points to 24 percent.

-- Both revenue and adjusted EBITDA in the Technology Solutions segment increased by more than 20 percent year-over-year, while utilization of billable data center capacity increased to 95 percent from 91 percent at the end of the fourth quarter.

-- Net DSL activations were 9,000 in the quarter, up 13 percent from a year ago which pushed the DSL subscriber base past 200,000. DSL penetration of in-territory consumer primary access lines reached 36 percent, up 8 percentage points.

-- Cincinnati Bell continued to grow its "Super Bundle" customer base and added 6,000 net subscribers in the first quarter and increased penetration of Cincinnati Bell households in the traditional operating area to 34 percent. Quarterly revenue per household was $89, a year-over-year increase of 10 percent.

-- First quarter free cash flow(3) was $22 million, down $7 million from the prior year due primarily to previously announced construction of additional data center capacity. Total debt at the end of the quarter was $2 billion.

"We are pleased with the progress represented by our first quarter performance," said Brian Ross, chief financial officer of Cincinnati Bell. "In addition to the strong revenue, EBITDA, and key metrics improvements, we continued to use our strong cash flow to reduce net debt(4), which we pushed below $2 billion in the quarter. Achieving this milestone demonstrates our continued commitment to our de-lever, defend and grow strategy."

Local Segment

The Local segment produced quarterly revenue of $187 million, up $1 million or 1 percent from the first quarter of 2006. Increased revenue from data services and expansion markets more than offset lower in-territory voice revenue. Operating income was $66 million, down $4 million from a year ago, as data revenue and operating cost efficiencies partially offset the impact of lower in-territory consumer access lines and restructuring charges of $2 million. Adjusted EBITDA, which excludes the restructuring charges, totaled $94 million, $2 million less than a year ago.

Growth in expansion market access lines continued and partially offset the loss of in-territory consumer access lines. Year-over-year total access line loss in the first quarter was 4.9 percent.

Wireless Services

Quarterly revenue from the Wireless segment increased $7 million to $69 million driven by year-over-year improvement in service revenue. Operating income was $8 million, up $4 million from last year, primarily due to a 12 percent increase in service revenue. Adjusted EBITDA was $17 million, up $5 million compared to the first quarter of 2006 while adjusted EBITDA margin expanded to 24 percent, up 6 points from a year ago.

In the first quarter, postpaid net activations were 10,000 compared to 13,000 in the first quarter of 2006, as postpaid churn remained flat at 1.4 percent. Quarterly postpaid average revenue per user (ARPU) totaled $44.75, which included an 8 percent increase in data ARPU compared to a year ago. In addition, prepaid net activations were 13,000 and prepaid ARPU of $22.42 increased 10 percent year-over-year.

Technology Solutions

The Technology Solutions segment produced revenue of $49 million, an increase of 25 percent from first quarter 2006. Contributing to the year-over-year revenue growth were increases of 22 percent in telecom and IT equipment revenue and 36 percent in data center and managed services revenue. Operating income totaled $3 million. Adjusted EBITDA was $4 million, up 23 percent from the first quarter of 2006 and reflected higher volumes of telecom and IT equipment sales as well as increased revenue from data center and managed services.

Utilization of existing billable data center capacity increased sequentially to 95 percent as demand for data center and managed services remained strong. Billable capacity in the quarter remained constant at 91,000 square feet. In the first quarter of 2007, the Technology Solutions segment invested $12 million of capital in the construction of future data center capacity.

Other Communications Services

Quarterly revenue from the Other segment, which includes long distance, security monitoring and payphone operations, increased from the prior year by 4 percent due largely to increased revenue from products for the enterprise market. Operating income was $6 million. Adjusted EBITDA of $7 million in the quarter was unchanged compared to the first quarter of 2006.

2007 Guidance

Cincinnati Bell confirms its 2007 guidance:

           Category                     2007 Guidance
--------------------------------------------------------------
Revenue                          Approximately $1.3 billion
--------------------------------------------------------------
Adjusted EBITDA(2)               Approximately $465 million
--------------------------------------------------------------
Capital Expenditures            Approximately 19% of revenue
--------------------------------------------------------------
Free Cash Flow(3)                 Approximately $50 million
--------------------------------------------------------------

Conference Call/Webcast

Cincinnati Bell will host a conference call today at 10:00 a.m. (ET) to discuss its results for the first quarter of 2007. A live webcast of the call will be available via the Investor Relations section of www.cincinnatibell.com. The conference call dial-in number is 866.278.7926. International callers may dial 904.596.2360. A taped replay call will be available one hour after the conclusion of the teleconference until 5:00 p.m. (ET) on May 22, 2007. For U.S. callers, the replay will be available at 888.284.7564. For international callers, the replay will be available at 904.596.3174. The replay reference number is 211945. An archived version of the webcast will also be available in the Investor Relations section of www.cincinnatibell.com.

Safe Harbor Note

Certain of the statements and predictions contained in this release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act. In particular, statements, projections or estimates that include or reference the words "believes," "anticipates," "plans," "intends," "expects," "will," or any similar expression fall within the safe harbor for forward-looking statements contained in the Reform Act. Actual results or outcomes may differ materially from those indicated or suggested by any such forward-looking statement for a variety of reasons, including, but not limited to: Cincinnati Bell's ability to maintain its market position in communications services, including wireless, wireline and internet services; general economic trends affecting the purchase or supply of telecommunication services; world and national events that may affect the ability to provide services; changes in the regulatory environment; any rulings, orders or decrees that may be issued by any court or arbitrator; restrictions imposed under various credit facilities and debt instruments; work stoppages caused by labor disputes; and Cincinnati Bell's ability to develop and launch new products and services. More information on potential risks and uncertainties is available in recent filings with the Securities and Exchange Commission, including Cincinnati Bell's Form 10-K report, Form 10-Q reports and Form 8-K reports. The forward-looking statements included in this release represent company estimates as of May 8, 2007. Cincinnati Bell anticipates that subsequent events and developments will cause its estimates to change.

Use of Non-GAAP Financial Measures

This press release contains information about net income excluding special items, free cash flow, net debt and adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA). These are non-GAAP financial measures used by Cincinnati Bell management when evaluating results of operations and cash flow. Management believes these measures also provide users of the financial statements with additional and useful comparisons of current results of operations and cash flows with past and future periods. Non-GAAP financial measures should not be construed as being more important than comparable GAAP measures. Detailed reconciliations of net income excluding special items, free cash flow, net debt and adjusted EBITDA to comparable GAAP financial measures have been included in the tables distributed with this release and are available in the Investor Relations section of www.cincinnatibell.com.

(1)Net income excluding special items provides a useful measure of operating performance. The amounts of the special items are detailed and reconciled to GAAP net income in the accompanying financial statements and in the Investor Relations section of the company's Web site, www.cincinnatibell.com.

(2)Adjusted EBITDA provides a useful measure of operational performance. The company defines adjusted EBITDA as GAAP Operating Income plus depreciation, amortization, restructuring charges, asset impairments and other special items. Adjusted EBITDA should not be considered as an alternative to comparable GAAP measures of profitability and may not be comparable with adjusted EBITDA as defined by other companies.

(3)Free cash flow provides a useful measure of operational performance, liquidity and financial health. The company defines free cash flow as SFAS 95 cash provided by (used in) operating, financing and investing activities, adjusted for the issuance and repayment of debt and for the proceeds from the sale or the use of funds from the purchase of business operations. Free cash flow should not be considered as an alternative to net income (loss), operating income (loss), cash flow from operating activities, or the change in cash on the balance sheet and may not be comparable with free cash flow as defined by other companies. Although the company feels that there is no comparable GAAP measure for free cash flow, the attached financial information reconciles free cash flow to the net increase (decrease) in cash and cash equivalents.

(4)Net debt provides a useful measure of liquidity and financial health. The company defines net debt as the sum of the face amount of short-term and long-term debt and unamortized premium and/or discount, offset by cash and cash equivalents.

About Cincinnati Bell Inc.

Cincinnati Bell Inc. (NYSE:CBB) is parent to one of the nation's most-respected and best-performing local exchange and wireless providers with a legacy of unparalleled customer service excellence. With headquarters in Cincinnati, Ohio, Cincinnati Bell provides a wide range of telecommunications products and services to residential and business customers in Ohio, Kentucky and Indiana. For more information, visit www.cincinnatibell.com.

Cincinnati Bell Inc.
Consolidated Statements of Income
(Unaudited)

 (dollars in millions, except per share
  amounts)

                                                 Three Months
                                                Ended March 31,   %
                                                 2007    2006   Change
                                                ------- ------- ------

 Revenue                                        $315.3  $298.2    6%

 Costs and expenses
  Cost of services and products                  133.1   128.0    4%
  Selling, general and administrative             65.5    58.3   12%
  Depreciation and amortization                   36.3    34.4    6%
  Shareholder claim settlement                       -     6.3   n/m
  Restructuring charges                            2.5     0.1   n/m
                                                ------- -------

      Operating income                            77.9    71.1   10%

 Minority interest expense                           -     0.4   n/m
 Interest expense                                 40.1    39.6    1%
 Other income, net                                (2.0)   (0.1)  n/m
                                                ------- -------

 Income before income taxes                       39.8    31.2   28%
 Income tax expense                               17.2    17.1    1%
                                                ------- -------

 Net income                                       22.6    14.1   60%

 Preferred stock dividends                         2.6     2.6    0%
                                                ------- -------

 Net income applicable to common shareowners     $20.0   $11.5   74%
                                                ======= =======


 Basic and diluted earnings per common share     $0.08   $0.05
 ---------------------------------------------- ======= =======

 Weighted average common shares outstanding
  (millions)
 ----------------------------------------------
  - Basic                                        247.1   246.6
  - Diluted                                      255.0   251.2

Cincinnati Bell Inc.
Segment Information
(Unaudited)

 (dollars in millions)

                                                 Three Months
                                                Ended March 31,   %
                                                 2007    2006   Change
                                                ------- ------- ------
  Local
 Revenue
  Voice                                         $115.0  $121.0   (5%)
  Data                                            62.5    56.6   10%
  Other                                            9.8     8.7   13%
                                                ------- -------

  Total revenue                                  187.3   186.3    1%

 Operating costs and expenses
  Cost of services and products                   58.1    58.7   (1%)
  Selling, general and administrative             35.7    32.5   10%
  Depreciation                                    25.1    25.6   (2%)
  Restructuring charges                            2.4       -   n/m
                                                ------- -------

  Total operating costs and expenses             121.3   116.8    4%
                                                ------- -------

 Operating income                                $66.0   $69.5   (5%)
                                                ======= =======

  Wireless
 Revenue
  Service                                        $62.2   $55.3   12%
  Equipment                                        6.3     6.5   (3%)
                                                ------- -------

  Total revenue                                   68.5    61.8   11%

 Operating costs and expenses
  Cost of services and products                   34.7    36.2   (4%)
  Selling, general and administrative             17.1    14.3   20%
  Depreciation and amortization                    9.2     7.5   23%
                                                ------- -------

  Total operating costs and expenses              61.0    58.0    5%
                                                ------- -------

 Operating income                                 $7.5    $3.8   97%
                                                ======= =======

  Technology Solutions
 Revenue
  Telecom and IT equipment distribution          $32.4   $26.5   22%
  Data center and managed services                14.4    10.6   36%
  Professional services                            1.7     1.7    0%
                                                ------- -------

  Total revenue                                   48.5    38.8   25%

 Operating costs and expenses
  Cost of services and products                   37.9    30.5   24%
  Selling, general and administrative              6.8     5.2   31%
  Depreciation and amortization                    1.3     0.8   63%
                                                ------- -------

  Total operating costs and expenses              46.0    36.5   26%
                                                ------- -------

 Operating income                                 $2.5    $2.3    9%
                                                ======= =======

  Other
 Revenue                                         $20.4   $19.7    4%

 Operating costs and expenses
  Cost of services and products                    9.8     9.1    8%
  Selling, general and administrative              3.7     3.5    6%
  Depreciation                                     0.7     0.5   40%
                                                ------- -------

  Total operating costs and expenses              14.2    13.1    8%
                                                ------- -------

 Operating income                                 $6.2    $6.6   (6%)
                                                ======= =======

  Broadband
 Revenue                                            $-      $-   n/m

 Costs and expenses
  Selling, general and administrative             (0.4)    0.4   n/m
  Restructuring charges                            0.1     0.1    0%
                                                ------- -------

  Total costs and expenses                        (0.3)    0.5   n/m
                                                ------- -------

 Operating income (loss)                          $0.3   $(0.5)  n/m
                                                ======= =======

Cincinnati Bell Inc.
Segment Information
(Unaudited)

 (dollars in millions)

                                                 Three Months
                                               Ended March 31,    %
                                                 2007    2006   Change
                                               -------- ------- ------
 Revenue
    Local                                       $187.3  $186.3    1%
    Wireless                                      68.5    61.8   11%
    Technology Solutions                          48.5    38.8   25%
    Other                                         20.4    19.7    4%
    Broadband                                        -       -   n/m
    Corporate and eliminations                    (9.4)   (8.4)  12%
                                               -------- -------

    Total revenue                               $315.3  $298.2    6%
                                               ======== =======

 Cost of Services and Products
    Local                                        $58.1   $58.7   (1%)
    Wireless                                      34.7    36.2   (4%)
    Technology Solutions                          37.9    30.5   24%
    Other                                          9.8     9.1    8%
    Broadband                                        -       -   n/m
    Corporate and eliminations                    (7.4)   (6.5)  14%
                                               -------- -------

    Total cost of services and products         $133.1  $128.0    4%
                                               ======== =======

 Selling, General & Administrative
    Local                                        $35.7   $32.5   10%
    Wireless                                      17.1    14.3   20%
    Technology Solutions                           6.8     5.2   31%
    Other                                          3.7     3.5    6%
    Broadband                                     (0.4)    0.4   n/m
    Corporate and eliminations                     2.6     2.4    8%
                                               -------- -------

    Total selling, general & administrative      $65.5   $58.3   12%
                                               ======== =======

 Depreciation and Amortization
    Local                                        $25.1   $25.6   (2%)
    Wireless                                       9.2     7.5   23%
    Technology Solutions                           1.3     0.8   63%
    Other                                          0.7     0.5   40%
    Broadband                                        -       -   n/m
    Corporate and eliminations                       -       -   n/m
                                               -------- -------

    Total depreciation and amortization          $36.3   $34.4    6%
                                               ======== =======

 Restructuring Charges and Shareholder Claim
  Settlement
    Local                                         $2.4      $-   n/m
    Wireless                                         -       -   n/m
    Technology Solutions                             -       -   n/m
    Other                                            -       -   n/m
    Broadband                                      0.1     0.1    0%
    Corporate and eliminations                       -     6.3   n/m
                                               -------- -------

    Total restructuring charges and shareholder
     claim settlement                             $2.5    $6.4  (61%)
                                               ======== =======

 Operating Income
    Local                                        $66.0   $69.5   (5%)
    Wireless                                       7.5     3.8   97%
    Technology Solutions                           2.5     2.3    9%
    Other                                          6.2     6.6   (6%)
    Broadband                                      0.3    (0.5)  n/m
    Corporate and eliminations                    (4.6)  (10.6) (57%)
                                               -------- -------

    Total operating income                       $77.9   $71.1   10%
                                               ======== =======

Cincinnati Bell Inc.
Segment Metric Information
(Unaudited)


                                                March 31, December 31,
                                                  2007        2006
                                                --------- ------------
 (in thousands)

 Local access lines                                875.9        887.1
 DSL subscribers                                   207.6        198.3
 Custom Connections (Super Bundle) subscribers     180.1        173.2

 Postpaid wireless subscribers                     375.8        365.8
 Prepaid wireless subscribers                      174.8        162.3
                                                --------- ------------

 Total wireless subscribers                        550.6        528.1
                                                ========= ============

 Consumer long distance lines                      393.8        394.8
 Business long distance lines                      160.5        157.5
                                                --------- ------------

 Total long distance lines                         554.3        552.3
                                                ========= ============


 Data Center and Managed Services
   Raised Floor (in square feet)                  91,000       91,000
   Utilization rate                                   95%          91%

Cincinnati Bell Telephone
Local Access Line Detail
(Unaudited)

                 ----------------------- ----------------------- -----
                          2005                    2006           2007
                 ----------------------- ----------------------- -----
(in thousands)    1Q    2Q    3Q    4Q    1Q    2Q    3Q    4Q    1Q
                 ----- ----- ----- ----- ----- ----- ----- ----- -----
Local Access
 Lines
----------------

In-Territory:
  Primary
   Residential   584.2 573.0 563.9 555.7 547.4 536.7 522.5 510.5 499.1
  Secondary
   Residential    48.9  47.1  45.4  43.9  42.4  40.9  39.2  37.6  36.2
  Business/Other 296.1 294.3 292.9 293.3 290.9 291.3 291.4 288.6 287.6
                 ----------------------- ----------------------- -----
Total In-
 Territory       929.2 914.4 902.2 892.9 880.7 868.9 853.1 836.7 822.9

Out-of-
 Territory:
  Primary
   Residential    17.7  18.4  20.5  21.5  22.8  24.8  26.8  28.1  29.4
  Secondary
   Residential     0.8   0.9   1.0   1.0   1.1   1.1   1.2   1.2   1.2
  Business/Other  12.2  12.8  13.9  15.2  16.3  17.7  19.4  21.0  22.4
                 ----------------------- ----------------------- -----
Total Out-of-
 Territory        30.7  32.1  35.4  37.7  40.2  43.6  47.4  50.3  53.0

                 ----------------------- ----------------------- -----
Total Access
 Lines           959.9 946.5 937.6 930.6 920.9 912.5 900.5 887.0 875.9
                 ======================= ======================= =====

Cincinnati Bell Inc.
Net Debt Calculation
(Unaudited)

                                                            Change
                                  March 31, December 31, -------------
                                    2007        2006        $      %
                                  --------- ------------ ------- -----
 (dollars in millions)
 Credit facility, revolver              $-           $-      $-   0%
 Credit facility, tranche B term
  loan                               344.0        395.0   (51.0) (13%)
 Cincinnati Bell Telephone notes     230.0        230.0       -   0%
 7 1/4% Senior Notes due 2013        496.9        496.9       -   0%
 7 1/4% Senior Notes due 2023         50.0         50.0       -   0%
 8 3/8% Senior Subordinated Notes
  due 2014                           633.2        631.5     1.7   0%
 7% Senior Notes due 2015            245.8        245.0     0.8   0%
 Capital leases and other debt        29.0         24.0     5.0   21%
 Net unamortized premium               0.8          0.8       -   0%
                                  --------- ------------ -------------

  Total debt                       2,029.7      2,073.2   (43.5) (2%)

 Add: Interest rate swap liability    11.0         13.5    (2.5) (19%)
 Less: Cash and cash equivalents     (45.9)       (79.4)   33.5  (42%)
                                  --------- ------------ -------------

  Net debt (as defined by the
   company)                       $1,994.8     $2,007.3  $(12.5) (1%)
                                  ========= ============ =============

 Credit facility availability       $245.2       $245.2      $-   0%
                                  ========= ============ =============

Cincinnati Bell Inc.
Consolidated Statements of Cash Flows
(Unaudited)

 (dollars in millions)

                                                        Three Months
                                                       Ended March 31,
                                                        2007    2006
                                                       ------- -------

 Cash provided by operating activities                  $68.3   $65.2
                                                       ------- -------

  Capital expenditures                                  (42.3)  (35.6)
  Acquisition of business and remaining minority
   interest in CBW                                       (4.6)  (83.2)
  Other, net                                             (0.5)    1.4
                                                       ------- -------

 Cash used in investing activities                      (47.4) (117.4)
                                                       ------- -------

  Increase in corporate credit facility, net                -    60.0
  Repayment of debt                                     (51.3)   (3.3)
  Issuance of common shares - exercise of stock options   0.1     0.6
  Preferred stock dividends                              (2.6)   (2.6)
  Other, net                                             (0.6)    0.8
                                                       ------- -------

 Cash (used in) provided by financing activities        (54.4)   55.5
                                                       ------- -------

 Net (decrease) increase in cash and cash equivalents   (33.5)    3.3
 Cash and cash equivalents at beginning of period        79.4    25.7
                                                       ------- -------

 Cash and cash equivalents at end of period             $45.9   $29.0
                                                       ======= =======


 Reconciliation of GAAP Cash Flow to Free Cash Flow as
  defined by the company
 Net (decrease) increase in cash and cash equivalents  $(33.5)   $3.3
 Less adjustments:
  Issuance of long-term debt and net change in
   corporate credit facility                                -   (60.0)
  Repayment of debt                                      51.3     3.3
  Acquisition of business and remaining minority
   interest in CBW                                        4.6    83.2
                                                       ------- -------

     Free cash flow (as defined by the company)         $22.4   $29.8
                                                       ======= =======

 Income tax payments                                     $0.1    $0.5

Cincinnati Bell Inc.
Reconciliation of Adjusted EBITDA (Non-GAAP) to Operating Income
 (GAAP)
(Unaudited)

(dollars in millions)

               -------------------------------------------------------
                          Three Months Ended March 31, 2007
               -------------------------------------------------------
                     Wire-  Technology       Broad-            Total
               Local  less  Solutions  Other  band  Corporate  Company
               ----- ------ ---------------- ------ --------- --------

Operating
 Income (GAAP) $66.0  $7.5       $2.5  $6.2   $0.3     $(4.6)   $ 77.9

Add:
 Depreciation
  and
  amortization  25.1   9.2        1.3   0.7      -         -      36.3
 Restructuring
  charges        2.4     -          -     -    0.1         -       2.5
               -------------------------------------------------------

EBITDA (Non-
 GAAP)         $93.5 $16.7       $3.8  $6.9   $0.4     $(4.6)  $ 116.7
               =======================================================



               -------------------------------------------------------
                          Three Months Ended March 31, 2006
               -------------------------------------------------------
                     Wire-  Technology       Broad-            Total
               Local  less  Solutions  Other  band  Corporate  Company
               ----- ------ ---------------- ------ --------- --------

Operating
 Income (GAAP) $69.5  $3.8       $2.3  $6.6  $(0.5)   $(10.6)   $ 71.1

Add:
 Depreciation
  and
  amortization  25.6   7.5        0.8   0.5      -         -      34.4
 Shareholder
  claim
  settlement,
  restructuring
  charges          -     -          -     -    0.1       6.3       6.4
               -------------------------------------------------------

EBITDA (Non-
 GAAP)         $95.1 $11.3       $3.1  $7.1  $(0.4)    $(4.3)  $ 111.9
               =======================================================

Cincinnati Bell Inc.
Normalized Statements of Operations (Non-GAAP) - Reconciliation to
 Reported Results
(Unaudited)

(dollars in millions, except per share amounts)

                                     Special Items
                               ---------------------------
                                                             Three
                                                          Months Ended
                                                           March 31,
                      Three                                2007 Before
                   Months Ended                Dividend      Special
                    March 31,   Restructuring    From         Items
                   2007 (GAAP)     Charge      Investment  (Non-GAAP)
                   ---------------------------------------------------
                                      A            B
Revenue                 $315.3            $-          $-       $315.3

Costs and expenses
  Cost of services
   and products          133.1             -           -        133.1
  Selling, general
   and
   administrative         65.5             -           -         65.5
  Depreciation and
   amortization           36.3             -           -         36.3
  Restructuring
   charges                 2.5          (2.5)          -            -
                   ------------ ------------- ----------- ------------
    Operating
     income               77.9           2.5           -         80.4

Interest expense          40.1             -           -         40.1
Other income, net         (2.0)                      1.9         (0.1)
                   ------------ ------------- ----------- ------------

Income before
 income taxes             39.8           2.5        (1.9)        40.4
Income tax expense        17.2           1.0        (0.8)        17.4
                   ------------ ------------- ----------- ------------

Net income                22.6           1.5        (1.1)        23.0

Preferred stock
 dividends                 2.6             -           -          2.6
                   ------------ ------------- ----------- ------------

Net income
 applicable to
 common shareowners      $20.0          $1.5       $(1.1)       $20.4
                   ============ ============= =========== ============

Weighted average
 diluted common
 shares                  255.0         255.0       255.0        255.0
                   ============ ============= =========== ============

Diluted earnings
 per common share        $0.08         $0.01      $(0.01)       $0.08
                   ============ ============= =========== ============

Normalized results have been adjusted for the following (pretax
 adjustments are effected at 40%):

A The Company incurred employee separation expense primarily related
   to the outsourcing of certain accounting functions and the
   reduction in workforce of various other administrative functions.

B One-time dividend received from cost investment.

Cincinnati Bell Inc.
Normalized Statements of Operations (Non-GAAP) - Reconciliation to
 Reported Results
(Unaudited)

(dollars in millions, except per share amounts)

                                        Special Items
                                     --------------------
                                                             Three
                                                         Months Ended
                                                          March 31,
                           Three                          2006 Before
                        Months Ended Shareholder Income     Special
                         March 31,      Claim      Tax       Items
                        2006 (GAAP)  Settlement  Expense  (Non-GAAP)
                        ----------------------------------------------
                                          A         B
Revenue                      $298.2          $-      $-        $298.2

Costs and expenses
  Cost of services and
   products                   128.0           -       -         128.0
  Selling, general and
   administrative              58.3           -       -          58.3
  Depreciation and
   amortization                34.4           -       -          34.4
  Shareholder claim
   settlement                   6.3        (6.3)      -             -
  Restructuring charges         0.1           -       -           0.1
                        ------------ ----------- ------- -------------
    Operating income           71.1         6.3       -          77.4

Minority interest
 expense                        0.4           -       -           0.4
Interest expense               39.6           -       -          39.6
Other income, net              (0.1)          -       -          (0.1)
                        ------------ ----------- ------- -------------

Income before income
 taxes                         31.2         6.3       -          37.5
Income tax expense             17.1         2.5    (3.6)         16.0
                        ------------ ----------- ------- -------------

Net income                     14.1         3.8     3.6          21.5

Preferred stock
 dividends                      2.6           -       -           2.6
                        ------------ ----------- ------- -------------

Net income applicable to
 common shareowners           $11.5        $3.8    $3.6         $18.9
                        ============ =========== ======= =============

Weighted average diluted
 common shares                251.2       251.2   251.2         251.2
                        ============ =========== ======= =============

Diluted earnings per
 common share                 $0.05       $0.02   $0.01         $0.08
                        ============ =========== ======= =============

Normalized results have been adjusted for the following (pretax
 adjustments are effected at 40%):

A Reserve of $6.3 million recorded for settlement of a shareholder
   claim.

B Kentucky net operating loss carry-forward write-off due to
   regulations issued in first quarter 2006.

Cincinnati Bell Inc.
Reconciliation of Adjusted EBITDA (Non-GAAP) Guidance to Operating
 Income (GAAP) Guidance
(Unaudited)

 (dollars in millions)

                                                                 2007
                                                                ------
 Consolidated 2007 Operating Income (GAAP) Guidance              $311

 Add:
      Depreciation and amortization                              $151
      Restructuring charges                                        $3
                                                                ------

 Consolidated 2007 Adjusted EBITDA Guidance                      $465
                                                                ======

SOURCE: Cincinnati Bell Inc.

Cincinnati Bell Inc.
Investor / Media contact:
Traci Bolte, 513-397-1195
traci.bolte@cinbell.com