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424B1
RENAISSANCE MEDIA GROUP LLC filed this Form 424B1 on 09/10/1998
Entire Document
 
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                          RENAISSANCE MEDIA GROUP LLC
 
         NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
                     FOR THE YEAR ENDED DECEMBER 31, 1997
                                (IN THOUSANDS)
 
  The unaudited pro forma combined statement of operations gives effect to the
following pro forma adjustments:
 
  (1) Reflects the reclassification of Renaissance Media's interest income
      from revenues to interest expense, net.
 
  (2) Reflects the estimated additional programming expenses, which would
      have been incurred if the Systems had been operating under the program
      management agreement with Time Warner.
 
  (3) Represents the amortization of debt issuance costs and organization
      costs over periods ranging from five to ten years.
 
  (4) Represents the depreciation and amortization of the write up (down) of
      property, plant and equipment, franchise assets and goodwill arising
      from the allocation of the purchase price to the Systems' assets under
      the purchase method of accounting. Pro forma depreciation amounts have
      been computed based on an estimate of the composite useful life of such
      assets (approximately 7 years), giving consideration to the planned
      upgrades of the cable infrastructure, which has resulted in a shorter
      composite useful life of such assets compared to Time Warner
      (approximately 11 years). Pro forma amortization amounts have been
      computed based on an estimate of the useful lives of franchise assets
      and goodwill (approximately 15 years and 25 years, respectively) using
      Renaissance Media's accounting policy estimates, which differ from the
      estimated useful lives of franchise assets and goodwill previously used
      by Time Warner (over periods up to 20 years and over periods up to 40
      years, respectively). The net adjustment was computed as follows:
 

<TABLE>
   <S>                                                                <C>
       Pro forma depreciation of property, plant and equipment....... $  9,514
       Pro forma amortization of franchise assets and goodwill.......   16,138
       Elimination of historical depreciation and amortization.......  (19,317)
                                                                      --------
       Pro forma increase in depreciation and amortization........... $  6,335
                                                                      ========
 
  (5) Reflects the following interest expense that would have been incurred
      based on the Acquisition financing:
 
       Interest on the Term Loans at an assumed weighted average
        interest
        rate of 8.11% (including commitment fees of $200)............ $  8,877
       Interest on the Notes.........................................   10,250
       Amortization of interest rate cap agreement...................       51
                                                                      --------
                                                                      $ 19,178
                                                                      ========
</TABLE>

 
    For each .25% change in the assumed interest rate on the Term Loans,
    pro forma interest expense would change by approximately $275.
 
  (6) Represents elimination of income tax expense because the Company will
      be treated as a partnership for federal income tax purposes.
 
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