Another mention which may be more important describes TCI Ventures holding in Antec.
TCI Ventures Group Reports Fourth Quarter and Year-End Results
ENGLEWOOD, Colo., March 25 /PRNewswire/ -- TCI Ventures Group (''TCI Ventures''), a unit of Tele-Communications, Inc. (''TCI''), today reported its financial results for the quarter ended December 31, 1997. These results are included in the TCI Form 10-K filed recently with the Securities and Exchange Commission.
COMBINED FINANCIAL RESULTS
TCI Ventures represents a portfolio of telecommunications investments, certain of which are consolidated in its financial statements. TCI Ventures consolidates the following investments:
At Home Corporation (Nasdaq:ATHM - news; ''At Home'') ETC w/tci, Inc. (''ETC'') National Digital Television Center, Inc. (''NDTC'') Tele-Communications International, Inc. (''TINTA'') United Video Satellite Group, Inc. (''United Video'') Western Tele-Communications, Inc. (''WTCI'')
Additionally, a significant portion of TCI Ventures' activities are conducted through its interests in entities that are not consolidated. These entities include:
Flextech p.l.c. (''Flextech'') Sprint Spectrum Holding Company, LP (''Sprint PCS'') Teleport Communications Group, Inc. (''Teleport'') Telewest Communications plc (''Telewest'')
Prior to its creation, TCI Ventures' assets and liabilities were attributed to TCI Group. Combined operating results for the fourth quarter and for the years ended December 31, 1997 and 1996 are summarized below.
TCI VENTURES
COMBINED OPERATING RESULTS SUMMARY
($ in millions)
Quarter Ended: Dec. 31, 1997 Dec. 31, 1996 Change
Revenue $211 $288 ($77)
Operating Cash Flow 20 15 5
Operating Loss (278) (30) (248)
Net Loss (286) (74) (212)
Year Ended: Dec. 31, 1997 Dec. 31, 1996 Change
Revenue $969 $926 $43
Operating Cash Flow 155 92 63
Operating Loss (350) (51) (299)
Net Loss (601) (258) (343)
Fourth quarter revenue decreased $77 million year-over-year primarily due to the deconsolidation of Flextech, effective January 1, 1997 and of Cablevision S.A. (''Cablevision''), effective October 1, 1997. The decreases in revenue were offset in part by revenue increases from United Video, WTCI and At Home.
TCI Ventures' consolidated operating income before depreciation, amortization, stock compensation and other non-cash charges (''Operating Cash Flow'') increased $5 million fourth quarter year-over-year, after deducting start-up Operating Cash Flow losses from At Home and ETC.
TCI Ventures' operating loss of $278 million for the three months ended December 31, 1997 is primarily attributable to stock compensation and non-cash charges resulting from At Home's distribution agreement with Cablevision Systems Corp [AMEX:CVC - news]. TCI Ventures' net loss of $286 million for the three months ended December 31, 1997 is primarily attributable to operating losses and its share of losses of affiliates, including Sprint PCS, Telewest and Teleport. These losses were offset in part by fourth quarter Operating Cash Flow, a gain of $112 million recognized upon a secondary offering of Teleport and a gain of $49 million recognized upon the reduction of TINTA's interest in Cablevision.
EVENTS AND TRANSACTIONS
Gary S. Howard Appointed President and CEO
On December 24, 1997, Gary S. Howard was appointed president and CEO of TCI Ventures. Mr. Howard has had a long association with TCI, with extensive experience in mergers and acquisitions. As president, Mr. Howard reports to Leo J. Hindery, Jr., president of TCI.
Stock Dividend
On January 8, 1998, TCI's Board of Directors declared stock dividends of one share of Series A TCI Ventures Group Common Stock for each share of Series A TCI Ventures Group Common Stock and of one share of Series B TCI Ventures Group Common Stock for each share of Series B TCI Ventures Group Common Stock held by shareholders as of the close of business on January 30, 1998.
At Home Corporation
During October 1997, At Home entered into a strategic alliance with Cablevision Systems Corp. to deliver its high-speed Internet service to key East Coast markets, including New York, Boston and Cleveland. Coupled with other current and pending affiliations, this alliance provides At Home access to more than 50 million homes in North America.
National Digital Television Center
In December 1997, NDTC entered into a memorandum of understanding with General Instrument Corporation (NYSE:GIC - news; ''GI'') which contemplates the sale to GI of certain assets of NDTC's set-top authorization business and the license of certain related technology to GI in exchange for approximately 21.4 million shares of GI stock. In connection with this transaction, NDTC would also enter into a services agreement in which it would provide certain services to GI's set-top authorization business. These transactions are subject to the signing of definitive agreements and all appropriate regulatory approvals.
TINTA
On January 27, 1998, TINTA announced the appointment of David Evans as president and CEO. Mr. Evans joined TINTA in September 1997 from News Corporation, where he held the position of executive vice president.
On October 1997, TINTA reduced its interest in its Argentine subsidiary, Cablevision, to 26 percent. Due to its reduced ownership interest, TINTA ceased consolidating the financial results of Cablevision effective October 1, 1997. In the fourth quarter, Cablevision acquired 50 percent of Video Cable Comunicaciones S.A., and 50 percent of United International Holdings Inc.'s [Nasdaq:UIHIA - news] cable systems in Argentina. Cablevision also acquired 100 percent of Mandeville Cable Partners in early 1998. These transactions make Cablevision one of the largest cable operators in Argentina.
As part of its strategy to strengthen its position in international programming, on March 11, 1998 TINTA announced that its Argentine programming affiliate, Torneos y Compentencias (''Torneos''), signed a memorandum of understanding to purchase Pramer S.R.L. (''Pramer''). Pramer is an Argentine company which programs, markets and distributes 16 cable channels and one terrestrial station to operators in Argentina and neighboring countries.
United Video
TCI purchased 12,400,000 shares of UVSG Series A Common Stock from Lawrence Flinn Jr., United Video's Chairman Emeritus on January 12, 1998. This tax-free transaction transfers Mr. Flinn's remaining interest in UVSG to TCI in return for approximately 12,700,000 shares of TCI Venture Group Series A Common Stock and approximately 7,300,000 shares of Liberty Media Group Series A Common Stock. As a result of this transaction, TCI owns approximately a 73 percent equity and a 93 percent voting interest in United Video. The attribution of TCI's 73 percent equity stake in United Video is split between TCI Ventures and Liberty, 56 percent and 17 percent, respectively.
On February 17, 1998, UVSG announced plans to acquire various business interests from TCI's Liberty Media Group (''Liberty'') in a tax-free stock transaction. The consummation of this transaction, which is subject to United Video shareholder approval as well as customary regulatory approvals, will have United Video acquiring Liberty's 40 percent interest in Superstar/ Netlink Group, a C-band Direct to Home satellite programming joint venture currently managed by UVSG, as well as Liberty's 100 percent interest in Netlink International which delivers various distant broadcast signal services commonly known as ''Denver 6'' to multichannel video service providers. In exchange for these assets, United Video will issue to Liberty approximately 6,375,000 million shares of its common stock. As a result of this transaction, TCI's collective equity interest in United Video will increase to 77 percent, 29 percent of which will be attributable to Liberty and 48 percent of which will be held by TCI Ventures.
Teleport Merger with AT&T
Teleport and AT&T announced a proposed merger between the two companies in January 1998. Upon conclusion of the merger, which is subject to regulatory approval, TCI Ventures would hold approximately 46.95 million shares of AT&T common stock, and would expect to receive an annual dividend of approximately $62 million from AT&T.
STOCK PRICE PERFORMANCE
A substantial portion of the investments that are attributed to TCI Ventures are in companies that are publicly traded. The aggregate market value increase of TCI Ventures' investment in such publicly traded companies was $786 million, or 14 percent for the quarter ended December 31, 1997. Teleport, TINTA and At Home's increased public market values contributed significantly to this result. Past market performance is no indication of future market performance.
TCI VENTURES
MARKET VALUE OF PUBLICLY TRADED COMPANIES
Percent Share
Shares Held Economic Price
Company (in millions) Ownership 12/31/97
49.79 28% $54.88
97.95 85% $18.00
46.46 39% $25.13
14.52 39% $28.75
6.33 16% $15.63
4.35 9% $3.63
0.67 5% $10.75
Market Value Market Value
12/31/97 9/30/97 Change
(in millions) (in millions) (in millions)
$2,732 $2,235 $497
TINTA (1) 1,763 1,604 159(1)
At Home 1,168 1,075 93
United Video 417 403 14
Antec Corp [Nasdaq:ANTC - news]. 106 (2) 79 (2) 27
Acclaim (3) 16 22 (6)
Sportsline 7 5 (4) 2
$6,209 $5,423 $786
(1) TINTA holds a 36.8 percent interest in Flextech and a 27 percent interest in Telewest. The shares of both Flextech and Telewest are publicly traded. (2) Includes in-the-money options. (3) TCI's Ventures' holdings in Acclaim Entertainment, Inc. were sold subsequent to year-end for $17M in cash. (4) Sportsline USA, Inc. (''Sportsline'') completed its initial public offering in November 1997. Its closing price on the first day of trading ($7 per share) was used in the calculation of market value as of September 30, 1997.
Tele-Communications, Inc. is traded through the TCI Group, the TCI Ventures Group, and the Liberty Media Group common stocks. The Series A and Series B TCI Ventures Group common stocks are traded on the National Market tier of the Nasdaq Stock Market under the symbols of TCIVA and TCIVB, respectively.
TCI VENTURES GROUP
SELECTED FINANCIAL INFORMATION
(amounts in millions)
Three months ended Dec. 31, Twelve months ended Dec. 31,
1997 1996 Change 1997 1996 Change
Revenue:
UVSGA (1) $131 126 5 $508 409 99
TINTA (2) 14 95 (81) 220 315 (95)
ETC 20 32 (12) 85 91 (6)
NDTC 24 25 (1) 94 75 19
WTCI 10 8 2 36 32 4
At Home 3 1 2 7 1 6
Other 9 1 8 19 3 16
$211 288 (77) $969 926 43
Operating Cash Flow (3):
UVSGA (1) $29 18 11 $104 66 38
TINTA (2) 0.00 6 (6) 75 33 42
ETC (10) (14) 4 (24) (17) (7)
NDTC 8 13 (5) 36 31 5
WTCI 3 2 1 12 12 0
At Home (11) (9) (2) (42) (23) (19)
Other 1 (1) 2 (6) (10) 4
$20 15 5 $155 92 63
Dec. 31, 1997
Total Total
Assets Debt (4)
Summary Balance Sheet:
TINTA $1,394 $390
Telephony investments (5) 928 0.00
UVSGA 429 28
NDTC 349 158
At Home 161 26
Other 519 193
$3,780 $795
Dec. 31, 1997
Fully
Current Diluted
Common Shares
Outstanding:
Series A 377.4 413.6
Series B 32.5 32.5
Total 409.9 446.1
(1) UVSGA results for the twelve months ended December 31, 1996 include the results of operations from the UVSGA/ TCI merger date, January 25, 1996, forward. (2) TINTA results for the twelve months ended December 31, 1997 exclude Flextech due to its deconsolidation effective January 1, 1997 and include Cablevision up to the date of its deconsolidation, October 1, 1997. (3) Operating Cash Flow is operating income before depreciation, amortization, stock compensation and other non-cash charges. (4) Total debt includes capital lease obligations. (5) Telephony investments include Venture Group's investments in Sprint PCS and Teleport.
"TCI VENTURES GROUP"
(a combination of certain assets)
Combined Balance Sheets
December 31, 1997 and 1996
1997 1996
amounts in thousands
Assets
Cash and cash equivalents $161,495 105,527
Trade and other receivables, net 86,856 115,491
Film inventory and other prepaid expenses 26,426 85,998
Investments in Sprint Spectrum Holding
Company, L.P. and MinorCo, L.P.
(and their respective predecessor)
and PhillieCo, L.P.
(collectively, the "PCS Ventures"),
accounted for under the equity method 607,333 829,651
Investment in Telewest Communications
plc ("Telewest"), accounted for
under the equity method 324,417 488,495
Investment in Teleport Communications Group,
Inc. ("TCG"), accounted for under the
equity method, and related receivables 294,851 276,112
Investment in Cablevision S.A. and
certain affiliated companies ("Cablevision"),
accounted for under the equity method 239,379 ---
Investments in other affiliates, accounted
for under the equity method, and
related receivables 631,918 474,599
Deferred tax asset 85,737 ---
Property and equipment, at cost:
Land 7,893 7,837
Distribution systems 851,145 761,191
Support equipment and buildings 116,088 208,294
975,126 977,322
Less accumulated depreciation 265,945 240,322
709,181 737,000
Franchise costs and other
intangible assets 333,516 1,029,842
Less accumulated amortization 76,507 103,631
257,009 926,211
Other assets, net of amortization 355,300 220,619
$3,779,902 4,259,703
"TCI VENTURES GROUP"
(a combination of certain assets)
Combined Balance Sheets, continued
December 31, 1997 and 1996
1997 1996
amounts in thousands
Liabilities and Combined Equity
Accounts payable $31,825 71,776
Accrued liabilities 109,549 148,962
Customer prepayments 133,479 100,670
MultiThematiques Obligation --- 47,902
Capital lease obligations 386,766 199,961
Debt 408,574 526,254
Deferred income taxes --- 220,306
Other liabilities 18,683 21,477
Total liabilities 1,088,876 1,337,308
Minority interests in equity of
attributed subsidiaries 420,177 411,594
Combined equity:
Combined equity 2,215,683 2,646,079
Cumulative foreign currency translation
adjustments, net of taxes 3,760 26,146
Unrealized holding gains for available-
for-sale securities, net of taxes 29,901 15,077
2,249,344 2,687,302
Due to (from) related parties 21,505 (176,501)
Total combined equity 2,270,849 2,510,801
Commitments and contingencies
$3,779,902 4,259,703
"TCI VENTURES GROUP"
(a combination of certain assets)
Combined Statements of Operations
Years ended December 31, 1997, 1996 and 1995
1997 1996 1995
amounts in thousands,
except per share amounts
Revenue $969,194 925,676 325,991
Operating costs and expenses:
Operating 551,437 536,457 137,038
Programming rights provision --- 8,706 ---
General and administrative 263,119 288,735 142,183
Cost of distribution agreement 172,591 --- ---
Impairment of intangible assets 14,992 --- ---
Stock compensation 142,484 (6,954) 4,614
Depreciation 122,993 90,411 49,125
Amortization 51,872 58,878 25,972
1,319,488 976,233 358,932
Operating loss (350,294) (50,557) (32,941)
Other income (expense):
Share of losses of the
PCS Ventures (493,435) (133,497) (33,890)
Share of losses of Telewest (145,264) (109,357) (70,274)
Share of losses of TCG (65,951) (50,543) (29,975)
Share of losses of Cablevision (3,377) -- --
Share of losses of other
affiliates (110,826) (74,941) (60,951)
Interest income 14,069 30,040 15,267
Interest expense (53,717) (51,128) (41,730)
Gain on sale of stock by
attributed entities 60,233 -- 122,660
Gain on issuance of stock
by equity investees 111,697 12,668 164,900
Gain on disposition of
assets, net 116,659 79,575 48,710
Recognized holding loss for
available-for-sale securities (1,194) (59,302) --
Minority interests' share
of losses (earnings) 95,429 28,177 (14,924)
Foreign currency transaction
gains (losses) 224 6,994 (2,649)
Other, net 2,552 3,104 (5,960)
(472,901) (318,210) 91,184
Earnings (loss) before
income taxes (823,195) (368,767) 58,243
Income tax benefit 222,684 110,345 1,797
Net earnings (loss) $(600,511) (258,422) 60,040
Basic and diluted loss attributable to common
stockholders per common share subsequent to
TCI Ventures Exchange $(.62)
SOURCE: TCI Ventures Group.
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and News:
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