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 (Date of earliest event reported): May 10, 2007
WINDSTREAM CORPORATION
(Exact name of registrant as specified in its charter)
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| Delaware
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001-32422
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20-0792300 |
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(State or other jurisdiction of
incorporation or organization)
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(Commission File Number)
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(I.R.S. Employer
Identification No.) |
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| 4001 Rodney Parham Road, |
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| Little Rock, Arkansas
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72212 |
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| (Address of principal executive offices)
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(Zip Code) |
(501) 748-7000
Registrant’s telephone number, including area code
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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On May 10, 2007, Windstream Corporation (“Windstream” or the “Company”) issued a press release
announcing the Company’s first quarter 2007 unaudited consolidated results of operations.
The Company’s press release and other communications from time to time include certain
financial measures that are not calculated in accordance with generally accepted accounting
principles (“GAAP”) in the United States. A “non-GAAP financial measure” is defined as a numerical
measure of a company’s financial performance, financial position or cash flows that excludes (or
includes) amounts that are included in (or excluded from) the most directly comparable measure
calculated and presented in accordance with GAAP in the Company’s financial statements. The
non-GAAP financial measures used by the Company may not be comparable to similarly titled measures
used by other companies and should not be considered in isolation or as a substitute for measures
of performance or liquidity prepared in accordance with GAAP.
The press release presents the Company’s consolidated results of operations measured under
GAAP and certain pro forma results of operations from current businesses. On July 17, 2006, Alltel
Corporation (“Alltel”) completed the spin-off of its wireline telecommunications business to its
stockholders and the merger of that wireline business with Valor Communications Group, Inc.
(“Valor”). The resulting company was renamed Windstream Corporation. The GAAP results for the
Company for the first quarter of 2006 reflect only the Alltel wireline business, which was
considered the accounting acquirer in the merger. On December 12, 2006, Windstream announced that
it would split off its directory publishing business in what is expected to be a tax-free
transaction with entities affiliated with Welsh, Carson, Anderson and Stowe (“WCAS”), a private
equity investment firm. The press release and other communications from time to time include a
presentation of certain unaudited pro forma historical results of operations that the Company
refers to as pro forma results from current businesses. These results from current businesses are
non-GAAP financial measures that reflect the following adjustments to measures prepared in
accordance with GAAP:
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The inclusion of results from Valor businesses for the first quarter of 2006; |
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Exclusion of results from directory publishing business for each period presented; |
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Inclusion of additional amortization for Valor customer lists for the first quarter of 2006; |
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Exclusion of royalty expense charged by Alltel for the use of the Alltel brand
during the first quarter of 2006; |
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Exclusion of restructuring and other charges for each period presented; |
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Exclusion of the first quarter 2006 impact of the application of Statement of
Financial Accounting Standards (“SFAS”) No. 71, “Accounting for the Effects of
Certain Types of Regulation”, which was discontinued during the third quarter of
2006. |
Windstream’s purpose for including the results of Valor’s businesses, and excluding the directory
publishing business and the non-recurring items listed above, is to improve the comparability of
results of operations for the first quarter of 2006 to the results of operations for the first
quarter of 2007. Windstream’s purpose for these adjustments is to focus on the true earnings
capacity associated with providing telecommunication services. Management believes the items either
included or excluded from the pro forma results from current businesses are related to strategic
activities or other events, specific to the time and opportunity available, and, accordingly,
should be excluded when evaluating the Company’s operations.
For these reasons, management believes that presenting current business measures assists investors
by providing more meaningful comparisons of results from current and prior periods and by providing
information that is a better reflection of the core earnings capacity of the businesses. The
Company uses pro forma results from current businesses as a key measure of the operational
performance of its business segments. Windstream management, including the chief operating
decision-maker, uses these measures consistently for all purposes, including internal reporting
purposes, the evaluation of business objectives, opportunities and performance, and the
determination of management compensation.
The Company’s press release and other communications from time to time include a non-GAAP
measure titled operating income before depreciation and amortization, or OIBDA. OIBDA can be
calculated directly from the Company’s financial statements by taking operating income and adding
back depreciation and amortization expense. The Company will also at times make reference to pro
forma OIBDA from current businesses, which is
also a non-GAAP measure. Pro forma OIBDA from current businesses adjusts OIBDA for the items
that are either included or excluded from pro forma results from current businesses. Management
considers OIBDA to be useful to investors because OIBDA provides information specific to the
Company’s operating performance.
The Company’s communications from time to time include a non-GAAP measure entitled net debt.
Net debt is consolidated debt, including current maturities, less cash and cash equivalents. The
Company believes net debt provides useful information to investors about the capacity of the
company to reduce the debt level and improve its capital structure.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
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Description |
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Exhibit 99(a)
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Press Release dated May 10, 2007 of Windstream |
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