TIME WARNER CABLE INC (TWC, Financial) filed Quarterly Report for the period ended 2009-09-30.
Time Warner Cable Inc. is the second-largest cable operator in the U.S. and an industry leader in developing and launching innovative video data and voice services. They deliver their services to customers over technologically-advanced well-clustered cable systems that pass approximately 26 million homes. Time Warner Cable Inc has a market cap of $14.11 billion; its shares were traded at around $40.05 with a P/E ratio of 10.7 and P/S ratio of 0.8.
On March 12, 2009, the separation of TWC from Time Warner was completed pursuant to a Separation Agreement dated as of May 20, 2008 (the Separation Agreement) between TWC and its subsidiaries, Time Warner Entertainment Company, L.P. (TWE) and TW NY, and Time Warner and its subsidiaries, Warner Communications Inc. (WCI), Historic TW Inc. (Historic TW) and American Television and Communications Corporation (ATC). In accordance with the Separation Agreement, on February 25, 2009, Historic TW transferred its 12.43% non-voting common stock interest in TW NY to TWC in exchange for 80 million newly issued shares (approximately 27 million shares after giving effect to the 1-for-3 reverse stock split discussed below) of TWCs Class A common stock (the TW NY Exchange). On March 12, 2009, TWC paid a special cash dividend of $10.27 per share ($30.81 per share after giving effect to the 1-for-3 reverse stock split, aggregating $10.856 billion) to holders of record on March 11, 2009 of TWCs outstanding Class A common stock and Class B common stock, which included Time Warner (the Special Dividend). Following the receipt by Time Warner of its share of the Special Dividend, TWC filed with the Secretary of State of the State of Delaware an amended and restated certificate of incorporation, pursuant to which, among other things, each outstanding share of TWC Class A common stock (including the shares of Class A common stock issued in the TW NY Exchange) and TWC Class B common stock was automatically converted (the Recapitalization) into one share of common stock, par value $0.01 per share (the TWC Common Stock). After the Recapitalization, TWCs separation from Time Warner (the Separation) was effected as a pro rata dividend of all shares of TWC Common Stock held by Time Warner to holders of record of Time Warners common stock (the Spin-Off Dividend or the Distribution) as of 8:00 pm on March 12, 2009, the record date for the Spin-Off Dividend. On March 12, 2009, Time Warner deposited its shares of TWC Common Stock with an agent and, at the record date for the Spin-Off Dividend, was deemed to no longer beneficially own such shares. On March 27, 2009, the distribution date for the Spin-Off Dividend, all of these shares of TWC Common Stock were distributed. The TW NY Exchange, the Special Dividend, the Recapitalization, the Separation and the Distribution collectively are referred to as the Separation Transactions.
To pay a portion of the Special Dividend, on March 12, 2009, TWC borrowed (i) the full committed amount of $1.932 billion under its 364-day senior unsecured term loan facility (the 2008 Bridge Facility) and (ii) approximately $3.3 billion under its senior unsecured five-year revolving credit facility (the Revolving Credit Facility). The Company funded the remainder of the Special Dividend with approximately $5.6 billion of cash on hand. See 2009 Bond Offerings and Termination of Lending Commitments below for further details regarding the termination of the 2008 Bridge Facility.
On March 26, 2009, TWC issued $3.0 billion in aggregate principal amount of senior unsecured notes (the March 2009 Bond Offering) and, on June 29, 2009, TWC issued $1.5 billion in aggregate principal amount of senior unsecured debentures (the June 2009 Bond Offering and, together with the March 2009 Bond Offering, the 2009 Bond Offerings) under a shelf registration statement on Form S-3 filed during 2008 (the Shelf Registration Statement) with the SEC that allows TWC to offer and sell from time to time senior and subordinated debt securities and debt warrants. The March 2009 Bond Offering consisted of $1.0 billion principal amount of 7.50% notes due 2014 and $2.0 billion principal amount of 8.25% notes due 2019. The June 2009 Bond Offering consisted of $1.5 billion principal amount of 6.75% debentures due 2039. TWCs obligations under the debt securities issued in the 2009 Bond Offerings are guaranteed by TWE and TW NY.
The Company used $1.934 billion of the net proceeds from the March 2009 Bond Offering to repay all of the borrowings outstanding under the 2008 Bridge Facility, as well as accrued interest and commitment fees, and such facility was terminated by the parties thereto in accordance with its terms. Additionally, as a result of the March 2009 Bond Offering and the termination of the 2008 Bridge Facility, the Company terminated Time Warners commitment (as lender) under a two-year $1.535 billion senior unsecured supplemental term loan facility, and the credit agreement governing such facility was terminated in accordance with its terms. The Company used the remaining net proceeds from the March 2009 Bond Offering to repay a portion of the borrowings outstanding under the Revolving Credit Facility.
In December 2007, the Financial Accounting Standards Board issued authoritative guidance that establishes accounting and reporting standards for a noncontrolling interest in a subsidiary, including the accounting treatment upon the deconsolidation of a subsidiary. This guidance became effective for TWC on January 1, 2009 and has been applied prospectively, except for the provisions related to the presentation of noncontrolling interests, which have been applied retrospectively for all periods presented. As required by this guidance, the Company has recast the presentation of noncontrolling interests in the prior year financial statements so that they are comparable to those of 2009. During the first quarter of 2009, noncontrolling interests of $1.110 billion as of December 31, 2008 were reclassified to a component of total equity as reflected in the accompanying consolidated balance sheet. For the three and nine months ended September 30, 2008, minority interest expense of $57 million and $144 million, respectively ($34 million and $86 million, respectively, net of tax), is excluded from net income in the accompanying consolidated statement of operations. Net income attributable to TWC per common share for prior periods is not impacted.
Read the The complete ReportTWC is in the portfolios of Dodge & Cox, Kenneth Fisher of Fisher Asset Management, LLC, George Soros of Soros Fund Management LLC, Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC.
Time Warner Cable Inc. is the second-largest cable operator in the U.S. and an industry leader in developing and launching innovative video data and voice services. They deliver their services to customers over technologically-advanced well-clustered cable systems that pass approximately 26 million homes. Time Warner Cable Inc has a market cap of $14.11 billion; its shares were traded at around $40.05 with a P/E ratio of 10.7 and P/S ratio of 0.8.
Highlight of Business Operations:
During the first quarter of 2009, TWC began a significant restructuring, primarily consisting of headcount reductions. TWC expects to incur total restructuring charges of approximately $75 million, including $64 million incurred through September 30, 2009.On March 12, 2009, the separation of TWC from Time Warner was completed pursuant to a Separation Agreement dated as of May 20, 2008 (the Separation Agreement) between TWC and its subsidiaries, Time Warner Entertainment Company, L.P. (TWE) and TW NY, and Time Warner and its subsidiaries, Warner Communications Inc. (WCI), Historic TW Inc. (Historic TW) and American Television and Communications Corporation (ATC). In accordance with the Separation Agreement, on February 25, 2009, Historic TW transferred its 12.43% non-voting common stock interest in TW NY to TWC in exchange for 80 million newly issued shares (approximately 27 million shares after giving effect to the 1-for-3 reverse stock split discussed below) of TWCs Class A common stock (the TW NY Exchange). On March 12, 2009, TWC paid a special cash dividend of $10.27 per share ($30.81 per share after giving effect to the 1-for-3 reverse stock split, aggregating $10.856 billion) to holders of record on March 11, 2009 of TWCs outstanding Class A common stock and Class B common stock, which included Time Warner (the Special Dividend). Following the receipt by Time Warner of its share of the Special Dividend, TWC filed with the Secretary of State of the State of Delaware an amended and restated certificate of incorporation, pursuant to which, among other things, each outstanding share of TWC Class A common stock (including the shares of Class A common stock issued in the TW NY Exchange) and TWC Class B common stock was automatically converted (the Recapitalization) into one share of common stock, par value $0.01 per share (the TWC Common Stock). After the Recapitalization, TWCs separation from Time Warner (the Separation) was effected as a pro rata dividend of all shares of TWC Common Stock held by Time Warner to holders of record of Time Warners common stock (the Spin-Off Dividend or the Distribution) as of 8:00 pm on March 12, 2009, the record date for the Spin-Off Dividend. On March 12, 2009, Time Warner deposited its shares of TWC Common Stock with an agent and, at the record date for the Spin-Off Dividend, was deemed to no longer beneficially own such shares. On March 27, 2009, the distribution date for the Spin-Off Dividend, all of these shares of TWC Common Stock were distributed. The TW NY Exchange, the Special Dividend, the Recapitalization, the Separation and the Distribution collectively are referred to as the Separation Transactions.
To pay a portion of the Special Dividend, on March 12, 2009, TWC borrowed (i) the full committed amount of $1.932 billion under its 364-day senior unsecured term loan facility (the 2008 Bridge Facility) and (ii) approximately $3.3 billion under its senior unsecured five-year revolving credit facility (the Revolving Credit Facility). The Company funded the remainder of the Special Dividend with approximately $5.6 billion of cash on hand. See 2009 Bond Offerings and Termination of Lending Commitments below for further details regarding the termination of the 2008 Bridge Facility.
On March 26, 2009, TWC issued $3.0 billion in aggregate principal amount of senior unsecured notes (the March 2009 Bond Offering) and, on June 29, 2009, TWC issued $1.5 billion in aggregate principal amount of senior unsecured debentures (the June 2009 Bond Offering and, together with the March 2009 Bond Offering, the 2009 Bond Offerings) under a shelf registration statement on Form S-3 filed during 2008 (the Shelf Registration Statement) with the SEC that allows TWC to offer and sell from time to time senior and subordinated debt securities and debt warrants. The March 2009 Bond Offering consisted of $1.0 billion principal amount of 7.50% notes due 2014 and $2.0 billion principal amount of 8.25% notes due 2019. The June 2009 Bond Offering consisted of $1.5 billion principal amount of 6.75% debentures due 2039. TWCs obligations under the debt securities issued in the 2009 Bond Offerings are guaranteed by TWE and TW NY.
The Company used $1.934 billion of the net proceeds from the March 2009 Bond Offering to repay all of the borrowings outstanding under the 2008 Bridge Facility, as well as accrued interest and commitment fees, and such facility was terminated by the parties thereto in accordance with its terms. Additionally, as a result of the March 2009 Bond Offering and the termination of the 2008 Bridge Facility, the Company terminated Time Warners commitment (as lender) under a two-year $1.535 billion senior unsecured supplemental term loan facility, and the credit agreement governing such facility was terminated in accordance with its terms. The Company used the remaining net proceeds from the March 2009 Bond Offering to repay a portion of the borrowings outstanding under the Revolving Credit Facility.
In December 2007, the Financial Accounting Standards Board issued authoritative guidance that establishes accounting and reporting standards for a noncontrolling interest in a subsidiary, including the accounting treatment upon the deconsolidation of a subsidiary. This guidance became effective for TWC on January 1, 2009 and has been applied prospectively, except for the provisions related to the presentation of noncontrolling interests, which have been applied retrospectively for all periods presented. As required by this guidance, the Company has recast the presentation of noncontrolling interests in the prior year financial statements so that they are comparable to those of 2009. During the first quarter of 2009, noncontrolling interests of $1.110 billion as of December 31, 2008 were reclassified to a component of total equity as reflected in the accompanying consolidated balance sheet. For the three and nine months ended September 30, 2008, minority interest expense of $57 million and $144 million, respectively ($34 million and $86 million, respectively, net of tax), is excluded from net income in the accompanying consolidated statement of operations. Net income attributable to TWC per common share for prior periods is not impacted.
Read the The complete ReportTWC is in the portfolios of Dodge & Cox, Kenneth Fisher of Fisher Asset Management, LLC, George Soros of Soros Fund Management LLC, Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC.
