Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 

 
FORM 8-K
 

 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: August 4, 2016



 
CINCINNATI BELL INC.
(Exact Name of Registrant as Specified in its Charter)

 

 
 
 
 
 
 
Ohio
 
001-8519
 
31-1056105
(State or other jurisdiction
of incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
221 East Fourth Street
Cincinnati, OH 45202
(Address of Principal Executive Office)
Registrant's telephone number, including area code: (513) 397-9900
 

 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))







Section 2 - Financial Information

Item 2.02     Results of Operations and Financial Condition

On August 4, 2016, Cincinnati Bell Inc. reported its financial results for the second quarter 2016. The earnings release is attached as Exhibit 99.1.
 
Section 7 - Regulation FD
 
Item 7.01     Regulation FD Disclosure
 
On August 4, 2016, Theodore H. Torbeck, the Company's president and chief executive officer, and Leigh R. Fox, the Company's chief financial officer, will present second quarter 2016 results. The presentation will be webcast both live and on-demand. To listen, go to the Investor Relations section of www.cincinnatibell.com, click on the Webcasts/Presentations tab and follow the instructions for accessing the webcast.
A copy of the presentation to be made during the meeting is attached to this Current Report as Exhibit 99.2.
The information in Items 2.02 and 7.01 and the exhibits attached to this Current Report as Exhibit 99.1 and 99.2 are being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934 or otherwise subject to the liabilities of that Section nor shall they be deemed incorporated by reference into any filing under the Securities Act of 1933 or the Securities Act of 1934, except as shall be expressly stated by specific reference in such filing.
 
Item 9.01    Financial Statements and Exhibits.

(c)
Exhibit No.
Description
 
 
 
 
 
 
 
 
 
 
 
 
Exhibit 99.1
Press release dated August 4, 2016
 
 
 
 
Exhibit 99.2
Presentation made during the Cincinnati Bell second quarter 2016 earnings conference call on August 4, 2016






Cautionary Statement Concerning Forward-Looking Statements


This report and the documents incorporated by reference herein contain forward-looking statements regarding future events and results that are subject to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, are statements that could be deemed forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as “expects,” “anticipates,” “predicts,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “continues,” “endeavors,” “strives,” “may,” or variations of such words and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections of future financial performance, anticipated growth and trends in businesses, and other characterizations of future events or circumstances are forward-looking statements. Readers are cautioned these forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which could cause actual results to differ materially and adversely from those reflected in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this release and those discussed in other documents the company filed with the Securities and Exchange Commission (SEC). More information on potential risks and uncertainties is available in our recent filings with the SEC, including Cincinnati Bell's Form 10-K report, Form 10-Q reports and Form 8-K reports. Actual results may differ materially and adversely from those expressed in any forward-looking statements. The company undertakes no obligation to revise or update any forward-looking statements for any reason. The forward-looking statements included in this report represent company estimates as of August 4, 2016. Cincinnati Bell anticipates that subsequent events and developments will cause its estimates to change.




SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
 
 
 
 
 
 
CINCINNATI BELL INC.
 
 
 
 
 
Date:
August 4, 2016
 
By:
/s/ Christopher J. Wilson
 
 
 
 
Christopher J. Wilson
 
 
 
 
Vice President, General Counsel and Secretary




EXHIBIT INDEX

Exhibit No.
Description
 
 
 
 
 
 
 
 
 
 
99.1
Press release dated August 4, 2016
 
 
99.2
Presentation made during the Cincinnati Bell second quarter 2016 earnings conference call on August 4, 2016



Document


Cincinnati Bell Reports Second Quarter 2016 Results

HIGHLIGHTS
Consolidated revenue increased $13 million over the prior year - revenue from strategic products was up 21 percent compared to the prior year
Entertainment and Communications revenue totaled $193 million, up $10 million from a year ago - Fioptics revenue was up 37 percent compared to the prior year
Net income totaled $78 million, resulting in diluted earnings per share of $0.36
Strong second quarter Adjusted EBITDA1 of $76 million, up 2 percent compared to the prior year

CINCINNATI - August 4, 2016 - Cincinnati Bell Inc. (NYSE:CBB) today announced financial results for the second quarter of 2016, highlighted by year-over-year consolidated revenue and Adjusted EBITDA growth. Operating income totaled $27 million in the second quarter of 2016, compared to $30 million in the prior year. Strategic revenues totaled $158 million, increasing 21 percent over the prior year on strong demand for IT services and fiber products. Fioptics video subscribers totaled 126,800 at the end of the quarter, up 25 percent compared to a year ago. Total internet subscribers were 296,700, an increase of 21,600 compared to the prior year. In the second quarter, 25,000 additional units were passed with Fioptics, which is now available to 478,700 addresses, or approximately 60 percent of Greater Cincinnati.

“Our impressive second quarter results demonstrate this team's ability to consistently exceed expectations. Based on our strong performance, we are confident in achieving our full-year financial guidance," said Ted Torbeck, president and chief executive officer.

CONSOLIDATED RESULTS2  
Consolidated revenue for the second quarter of 2016 was $299 million, up 5 percent from the prior year. Operating income for the quarter totaled $27 million and Adjusted EBITDA equaled $76 million. Net income was $78 million, resulting in diluted earnings per share of $0.36. In the second quarter, we recognized a $119 million gain on the sale of 3 million CyrusOne common shares and a $5 million loss on the extinguishment of $86 million of debt.

Entertainment and Communications Segment
Entertainment and Communications revenue for the quarter totaled $193 million, up $10 million compared to the prior year.
Fioptics revenue for the quarter was $62 million, up 37 percent from the prior year.
Strategic revenue for business and carrier markets totaled $49 million (including $3 million of Fioptics revenue) for the quarter, up $7 million year-over-year.





Operating income totaled $27 million in the second quarter, compared to $30 million in the prior year.
Adjusted EBITDA for the quarter was $73 million, up 3 percent year-over-year.

IT Services and Hardware Segment
Revenue of $110 million for the quarter was up 3 percent over the prior year.
Strategic revenue was $49 million in the quarter, up 10 percent compared to the prior year.
Telecom and IT hardware revenue was $54 million for the quarter, compared to $56 million in the second quarter of 2015.
Operating income totaled $7 million for the quarter, up $1 million compared to the prior year.
Adjusted EBITDA was $10 million, up 6 percent compared to a year ago.

2016 Outlook
Cincinnati Bell reaffirms its financial guidance for 2016:
Category
2016 Guidance
Revenue
$1.2 billion
Adjusted EBITDA
$303 million*
*Plus or minus 2 percent





Conference Call/Webcast
Cincinnati Bell will host a conference call on August 4 at 10:00 a.m. (ET) to discuss its results for the second quarter of 2016. 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 (888) 634-7543. Callers located outside of the U.S. and Canada may dial (719) 325-2336. A taped replay of the conference call will be available approximately one hour after the conclusion of the call until 1:00 p.m. on Thursday, August 18, 2016. For U.S. callers, the replay will be available at (888) 203-1112. For callers outside of the U.S. and Canada, the replay will be available at (719) 457-0820. The replay reference number is 6440436. An archived version of the webcast will also be available in the Investor Relations section of www.cincinnatibell.com.

Safe Harbor Note
This release and the documents incorporated by reference herein contain forward-looking statements regarding future events and our future results that are subject to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, are statements that could be deemed forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as “expects,” “anticipates,” “predicts,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “continues,” “endeavors,” “strives,” “may,” variations of such words and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances are forward-looking statements. Readers are cautioned these forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which could cause our actual results to differ materially and adversely from those reflected in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this release and those discussed in other documents we file with the Securities and Exchange Commission (SEC). More information on potential risks and uncertainties is available in our recent filings with the SEC, including Cincinnati Bell's Form 10-K report, Form 10-Q reports and Form 8-K reports. Actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason.






Use of Non-GAAP Financial Measures
This press release contains information about adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA), Adjusted EBITDA margin, net debt, net income excluding special items and free cash flow. 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 these non-GAAP financial measures 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.
 
1Adjusted EBITDA provides a useful measure of operational performance. The company defines Adjusted EBITDA as GAAP operating income plus depreciation, amortization, restructuring charges, (gain) loss on sale or disposal of assets, transaction costs, curtailment gain (loss), asset impairments, components of pension and other retirement plan costs (including interest costs, asset returns, and amortization of actuarial gains and losses), 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 the measure as defined by other companies.

2Consolidated Results for the three and six months ended June 30, 2015 report our former wireless segment results as discontinued operations. Effective March 31, 2015, the Company no longer provides wireless services.

Adjusted EBITDA margin provides a useful measure of operational performance. The company defines Adjusted EBITDA margin as Adjusted EBITDA divided by revenue. Adjusted EBITDA margin should not be considered as an alternative to comparable GAAP measures of profitability and may not be comparable with the measure as defined by other companies.

Free cash flow provides a useful measure of operational performance, liquidity and financial health. The company defines free cash flow as cash provided by (used in) operating, financing and investing activities, adjusted for the issuance and repayment of debt, debt issuance costs, the repurchase of common stock, and the proceeds from the sale or the use of funds from the purchase of business operations, including transaction costs. 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.






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, unamortized premium and/or discount and note issuance costs, offset by cash and cash equivalents.

Net income excluding special items in total and per share provides a useful measure of operating performance. Net income excluding special items should not be considered as an alternative to comparable GAAP measures of profitability and may not be comparable with net income excluding special items as defined by other companies.

About Cincinnati Bell Inc.
With headquarters in Cincinnati, Ohio, Cincinnati Bell Inc. (CBB) provides integrated communications solutions – including local and long distance voice, data, high-speed Internet and video – that keep residential and business customers in Greater Cincinnati and Dayton connected with each other and with the world. In addition, enterprise customers across the United States rely on CBTS, a wholly-owned subsidiary, for efficient, scalable office communications systems and end-to-end IT solutions. For more information, please visit www.cincinnatibell.com.





Cincinnati Bell Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated Statements of Operations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Dollars in millions, except per share amounts)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Six Months Ended
 
 
 
 
 
 
 
 
 
June 30,
 
Change
 
June 30,
 
Change
 
 
 
 
 
2016
 
2015
 
$
 
%
 
2016
 
2015
 
$
 
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
$
299.2

 
$
285.8

 
$
13.4

 
5%
 
$
588.1

 
$
578.7

 
$
9.4

 
2%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs and expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of services and products
 
170.8

 
162.2

 
8.6

 
5%
 
333.5

 
328.4

 
5.1

 
2%
 
 
Selling, general and administrative
 
56.2

 
57.0

 
(0.8
)
 
(1)%
 
109.4

 
109.2

 
0.2

 
0%
 
 
Depreciation and amortization
 
44.8

 
34.0

 
10.8

 
32%
 
88.2

 
66.6

 
21.6

 
32%
 
 
Other
 

 
2.9

 
(2.9
)
 
n/m
 

 
7.7

 
(7.7
)
 
n/m
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating income
 
27.4

 
29.7

 
(2.3
)
 
(8)%
 
57.0

 
66.8

 
(9.8
)
 
(15)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense
 
19.9

 
28.0

 
(8.1
)
 
(29)%
 
40.2

 
60.7

 
(20.5
)
 
(34)%
 
Loss on extinguishment of debt
 
5.2

 
13.5

 
(8.3
)
 
(61)%
 
2.8

 
13.5

 
(10.7
)
 
(79)%
 
Gain on sale of CyrusOne investment
 
(118.6
)
 
(295.2
)
 
176.6

 
(60)%
 
(118.6
)
 
(295.2
)
 
176.6

 
(60)%
 
Other (income) expense, net
 
(1.1
)
 
1.3

 
(2.4
)
 
n/m
 
(1.1
)
 
4.8

 
(5.9
)
 
n/m
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from continuing operations before income taxes
 
122.0

 
282.1

 
(160.1
)
 
(57)%
 
133.7

 
283.0

 
(149.3
)
 
(53)%
 
Income tax expense
 
44.4

 
101.4

 
(57.0
)
 
(56)%
 
49.1

 
102.0

 
(52.9
)
 
(52)%
 
Income from continuing operations
 
77.6

 
180.7

 
(103.1
)
 
(57)%
 
84.6

 
181.0

 
(96.4
)
 
(53)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from discontinued operations (net of tax)
 

 
10.9

 
(10.9
)
 
n/m
 

 
59.8

 
(59.8
)
 
n/m
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 
77.6

 
191.6

 
(114.0
)
 
(59)%
 
84.6

 
240.8

 
(156.2
)
 
(65)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Preferred stock dividends *
 
2.6

 
2.6

 

 
0%
 
5.2

 
5.2

 

 
0%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income applicable to common shareowners
 
$
75.0

 
$
189.0

 
$
(114.0
)
 
(60)%
 
$
79.4

 
$
235.6

 
$
(156.2
)
 
(66)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic net earnings per common share
 


 

 
 
 
 
 


 


 
 
 
 
 
 
 
Earnings from continuing operations
 
$
0.36

 
$
0.85

 
 
 
 
 
$
0.38

 
$
0.84

 
 
 
 
 
 
 
Earnings from discontinued operations
 

 
0.05

 
 
 
 
 

 
0.29

 
 
 
 
 
Basic net earnings per common share
 
$
0.36


$
0.90

 
 
 
 
 
$
0.38


$
1.13

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Diluted net earnings per common share
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings from continuing operations
 
$
0.36

 
$
0.84

 
 
 
 
 
$
0.38

 
$
0.84

 
 
 
 
 
 
 
Earnings from discontinued operations
 

 
0.05

 
 
 
 
 

 
0.28

 
 
 
 
 
Diluted net earnings per common share
 
$
0.36

 
$
0.89

 
 
 
 
 
$
0.38

 
$
1.12

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 - Basic
 
209.8

 
209.7

 
 
 
 
 
209.9

 
209.4

 
 
 
 
 
 
 - Diluted
 
210.4

 
214.6

 
 
 
 
 
210.4

 
210.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
* Calculation of diluted earnings per common share for the three months ended June 30, 2015 excludes preferred stock dividends as the preferred shares are considered converted.






Cincinnati Bell Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income Statements by Segment
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Dollars in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Six Months Ended
 
 
 
 
 
 
 
 
June 30,
 
Change
 
June 30,
 
Change
 
 
 
 
2016

2015
 
$
 
%
 
2016
 
2015
 
$
 
%
 
Entertainment and Communications
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
$
86.8

 
$
78.8

 
$
8.0

 
10%
 
$
172.0

 
$
160.0

 
$
12.0

 
8%
 
 
Voice
 
69.1

 
73.5

 
(4.4
)
 
(6)%
 
139.3

 
149.2

 
(9.9
)
 
(7)%
 
 
Video
 
30.9

 
22.9

 
8.0

 
35%
 
59.9

 
44.3

 
15.6

 
35%
 
 
Services and Other
 
5.7

 
7.2

 
(1.5
)
 
(21)%
 
11.6

 
17.0

 
(5.4
)
 
(32)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
192.5

 
182.4

 
10.1

 
6%
 
382.8

 
370.5

 
12.3

 
3%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating costs and expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of services and products
 
88.3

 
80.1

 
8.2

 
10%
 
176.1

 
161.6

 
14.5

 
9%
 
 
Selling, general and administrative
 
35.4

 
39.8

 
(4.4
)
 
(11)%
 
70.0

 
74.8

 
(4.8
)
 
(6)%
 
 
Depreciation and amortization
 
41.6

 
31.0

 
10.6

 
34%
 
81.8

 
60.5

 
21.3

 
35%
 
 
Other*
 

 
1.4

 
(1.4
)
 
n/m
 

 
2.2

 
(2.2
)
 
n/m
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total operating costs and expenses
 
165.3

 
152.3

 
13.0

 
9%
 
327.9

 
299.1

 
28.8

 
10%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating income
 
$
27.2

 
$
30.1

 
$
(2.9
)
 
(10)%
 
$
54.9

 
$
71.4

 
$
(16.5
)
 
(23)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IT Services and Hardware
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Professional Services
 
$
27.2

 
$
27.0

 
$
0.2

 
1%
 
$
53.4

 
$
51.1

 
$
2.3

 
5%
 
 
Management and Monitoring
 
7.9

 
7.6

 
0.3

 
4%
 
16.0

 
14.9

 
1.1

 
7%
 
 
Unified Communications
 
10.1

 
9.1

 
1.0

 
11%
 
20.2

 
18.7

 
1.5

 
8%
 
 
Cloud Services
 
10.8

 
7.0

 
3.8

 
54%
 
21.0

 
13.1

 
7.9

 
60%
 
 
Telecom and IT hardware
 
53.8

 
55.6

 
(1.8
)
 
(3)%
 
101.7

 
116.1

 
(14.4
)
 
(12)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
109.8


106.3

 
3.5

 
3%
 
212.3

 
213.9

 
(1.6
)
 
(1)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating costs and expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of services and products
 
85.5

 
83.5

 
2.0

 
2%
 
164.1

 
169.9

 
(5.8
)
 
(3)%
 
 
Selling, general and administrative
 
14.2

 
13.3

 
0.9

 
7%
 
27.7

 
26.7

 
1.0

 
4%
 
 
Depreciation and amortization
 
3.2

 
3.0

 
0.2

 
7%
 
6.4

 
6.1

 
0.3

 
5%
 
 
Other*
 

 
0.3

 
(0.3
)
 
n/m
 

 
3.9

 
(3.9
)
 
n/m
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total operating costs and expenses
 
102.9

 
100.1

 
2.8

 
3%
 
198.2

 
206.6

 
(8.4
)
 
(4)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating income
 
$
6.9

 
$
6.2

 
$
0.7

 
11%
 
$
14.1

 
$
7.3

 
$
6.8

 
93%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
* Other includes restructuring charges, loss on sale or disposal of assets (net) and a curtailment loss.






Cincinnati Bell Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues by Segment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Dollars in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Six Months Ended
 
 
 
 
 
 
 
 
 
June 30,
 
Change
 
June 30,
 
Change
 
 
 
 
 
2016
 
2015
 
$
 
%
 
2016
 
2015
 
$
 
%
Entertainment and Communications
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consumer
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Strategic
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
$
25.2

 
$
17.3

 
$
7.9

 
46%
 
$
48.7

 
$
33.2

 
$
15.5

 
47%
 
 
 
Voice
 
5.4

 
4.8

 
0.6

 
13%
 
10.6

 
9.6

 
1.0

 
10%
 
 
 
Video
 
30.4

 
22.5

 
7.9

 
35%
 
58.9

 
43.5

 
15.4

 
35%
 
 
 
Services and other
 
0.9

 
0.9

 

 
0%
 
1.8

 
1.9

 
(0.1
)
 
(5)%
 
 
 
 
 
61.9

 
45.5

 
16.4

 
36%
 
120.0

 
88.2

 
31.8

 
36%
 
 
Legacy
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
11.8

 
12.6

 
(0.8
)
 
(6)%
 
24.0

 
25.9

 
(1.9
)
 
(7)%
 
 
 
Voice
 
18.7

 
21.8

 
(3.1
)
 
(14)%
 
38.5

 
44.8

 
(6.3
)
 
(14)%
 
 
 
Services and other
 
1.1

 
1.2

 
(0.1
)
 
(8)%
 
2.2

 
2.6

 
(0.4
)
 
(15)%
 
 
 
 
 
31.6

 
35.6

 
(4.0
)
 
(11)%
 
64.7

 
73.3

 
(8.6
)
 
(12)%
 
 
Integration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Services and other
 
1.0

 
1.6

 
(0.6
)
 
(38)%
 
2.1

 
5.1

 
(3.0
)
 
(59)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total consumer revenue
 
$
94.5

 
$
82.7

 
$
11.8

 
14%
 
$
186.8

 
$
166.6

 
$
20.2

 
12%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Strategic
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
$
24.0

 
$
22.0

 
$
2.0

 
9%
 
$
47.6

 
$
43.9

 
$
3.7

 
8%
 
 
 
Voice
 
12.5

 
10.7

 
1.8

 
17%
 
24.5

 
20.6

 
3.9

 
19%
 
 
 
Video
 
0.5

 
0.4

 
0.1

 
25%
 
1.0

 
0.8

 
0.2

 
25%
 
 
 
Services and other
 
0.5

 
0.6

 
(0.1
)
 
(17)%
 
0.9

 
1.3

 
(0.4
)
 
(31)%
 
 
 
 
 
37.5

 
33.7

 
3.8

 
11%
 
74.0

 
66.6

 
7.4

 
11%
 
 
Legacy
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
5.1

 
5.9

 
(0.8
)
 
(14)%
 
10.5

 
12.0

 
(1.5
)
 
(13)%
 
 
 
Voice
 
28.4

 
31.1

 
(2.7
)
 
(9)%
 
57.4

 
63.3

 
(5.9
)
 
(9)%
 
 
 
Services and other
 
0.3

 
0.4

 
(0.1
)
 
(25)%
 
0.6

 
0.8

 
(0.2
)
 
(25)%
 
 
 
 
 
33.8

 
37.4

 
(3.6
)
 
(10)%
 
68.5

 
76.1

 
(7.6
)
 
(10)%
 
 
Integration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Services and other
 
0.5

 
0.7

 
(0.2
)
 
(29)%
 
0.9

 
1.5

 
(0.6
)
 
(40)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total business revenue
 
$
71.8

 
$
71.8

 
$

 
0%
 
$
143.4

 
$
144.2

 
$
(0.8
)
 
(1)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Carrier
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Strategic
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
$
11.6

 
$
8.6

 
$
3.0

 
35%
 
$
22.6

 
$
19.2

 
$
3.4

 
18%
 
 
Legacy
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data
 
9.1

 
12.4

 
(3.3
)
 
(27)%
 
18.6

 
25.8

 
(7.2
)
 
(28)%
 
 
 
Voice
 
4.1

 
5.1

 
(1.0
)
 
(20)%
 
8.3

 
10.9

 
(2.6
)
 
(24)%
 
 
 
Services and other
 
1.4

 
1.8

 
(0.4
)
 
(22)%
 
3.1

 
3.8

 
(0.7
)
 
(18)%
 
 
 
 
 
14.6

 
19.3

 
(4.7
)
 
(24)%
 
30.0

 
40.5

 
(10.5
)
 
(26)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total carrier revenue
 
$
26.2

 
$
27.9

 
$
(1.7
)
 
(6)%
 
$
52.6

 
$
59.7

 
$
(7.1
)
 
(12)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Entertainment and Communications
 
$
192.5

 
$
182.4

 
$
10.1

 
6%
 
$
382.8

 
$
370.5

 
$
12.3

 
3%






Cincinnati Bell Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues by Segment
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Dollars in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Six Months Ended
 
 
 
 
 
 
 
 
 
June 30,
 
Change
 
June 30,
 
Change
 
 
 
 
 
2016
 
2015
 
$
 
%
 
2016
 
2015
 
$
 
%
IT Services and Hardware
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Strategic
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Professional Services
 
$
23.1

 
$
23.5

 
$
(0.4
)
 
(2)%
 
$
45.4

 
$
44.1

 
$
1.3

 
3%
 
 
 
Management and Monitoring
 
7.9

 
7.6

 
0.3

 
4%
 
16.0

 
14.9

 
1.1

 
7%
 
 
 
Unified Communications
 
7.3

 
6.5

 
0.8

 
12%
 
14.8

 
13.2

 
1.6

 
12%
 
 
 
Cloud Services
 
10.8

 
7.0

 
3.8

 
54%
 
21.0

 
13.1

 
7.9

 
60%
 
 
 
 
 
49.1

 
44.6

 
4.5

 
10%
 
97.2

 
85.3

 
11.9

 
14%
 
 
Integration
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Professional Services
 
4.1

 
3.5

 
0.6

 
17%
 
8.0

 
7.0

 
1.0

 
14%
 
 
 
Unified Communications
 
2.8

 
2.6

 
0.2

 
8%
 
5.4

 
5.5

 
(0.1
)
 
(2)%
 
 
 
Telecom and IT hardware
 
53.8

 
55.6

 
(1.8
)
 
(3)%
 
101.7

 
116.1

 
(14.4
)
 
(12)%
 
 
 
 
 
60.7

 
61.7

 
(1.0
)
 
(2)%
 
115.1

 
128.6

 
(13.5
)
 
(10)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total IT Services and Hardware Revenue
 
$
109.8

 
$
106.3

 
$
3.5

 
3%
 
$
212.3

 
$
213.9

 
$
(1.6
)
 
(1)%







Cincinnati Bell Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segment Information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Dollars in millions)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Six Months Ended
 
 
 
 
 
 
 
 
June 30,
 
Change
 
June 30,
 
Change
 
 
 
 
2016
 
2015
 
$
 
%
 
2016
 
2015
 
$
 
%
 
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Entertainment and Communications
 
$
192.5

 
$
182.4

 
$
10.1

 
6%
 
$
382.8

 
$
370.5

 
$
12.3

 
3%
 
 
IT Services and Hardware
 
109.8

 
106.3

 
3.5

 
3%
 
212.3

 
213.9

 
(1.6
)
 
(1)%
 
 
Eliminations
 
(3.1
)
 
(2.9
)
 
(0.2
)
 
7%
 
(7.0
)
 
(5.7
)
 
(1.3
)
 
23%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
$
299.2

 
$
285.8

 
$
13.4

 
5%
 
$
588.1

 
$
578.7

 
$
9.4

 
2%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of Services and Products
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Entertainment and Communications
 
$
88.3

 
$
80.1

 
$
8.2

 
10%
 
$
176.1

 
$
161.6

 
$
14.5

 
9%
 
 
IT Services and Hardware
 
85.5

 
83.5

 
2.0

 
2%
 
164.1

 
169.9

 
(5.8
)
 
(3)%
 
 
Eliminations
 
(3.0
)
 
(1.4
)
 
(1.6
)
 
n/m
 
(6.7
)
 
(3.1
)
 
(3.6
)
 
n/m
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total cost of services and products
 
$
170.8

 
$
162.2

 
$
8.6

 
5%