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SEC Filings

10-K405
RENAISSANCE MEDIA GROUP LLC filed this Form 10-K405 on 03/31/1999
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for the Systems to Time Warner and the capitalization of the Company,
respectively. The Systems net cash provided by operations was $23.6 million in
1997 and $23.1 million in 1996. The Systems net cash used in investing
activities was $6.4 million in 1997 and $8.2 million in 1996, respectively and
in 1996 Time Warner allocated $249.5 million of the purchase price paid (net
of cash acquired) for CVI to the Systems. The Systems net cash used in some
financing activities was $16.4 million in 1997 and $14.9 million in 1996,
respectively and in 1996 Time Warner allocated $250.0 million of the purchase
price paid for CVI to the Systems. The Systems net cash provided by operations
for the period January 1, 1998 though April 8, 1998 was $7.0 million. The
Systems net cash used in investing activities for the period January 1, 1998
through April 8, 1998 was $.6 million. The Systems net cash used in financing
activities for the period January 1, 1998 through April 8, 1998 was $7.8
million.
 
   The Company's EBITDA was $20.5 million or 49.3% of revenues during the
operating period in 1998. The Systems EBITDA was $25.1 million in 1997 and
$22.0 million in 1996. The System's EBITDA as a percentage of revenue
increased to 49.2 % in 1997 from 46.4% in 1996, primarily resulting from a
change in the method of recording franchise fees. Had the method of recording
franchise fees been changed in 1996 the effect of this change would have
resulted in EBITDA margin of 48.0% for 1996. The Systems EBITDA was $7.5
million for the period January 1, 1998 to April 8, 1998. As a percentage of
revenue EBITDA was 49.2% for the period January 1, 1998 to April 8, 1998.
 
   Simultaneously with the Offering of the Senior Discount Notes: (i) the
Company received equity contributions of $95.1 million from the Morgan Stanley
Entities and $3.9 million from the Management Investors; (ii) Renaissance
Media, as borrower, and Renaissance Louisiana, Renaissance Tennessee and
Renaissance Capital, as guarantors, entered into the Senior Credit Facility,
consisting of $110.0 million in Term Loans and a $40.0 million Revolver; and
(iii) Renaissance Media acquired the Systems from Time Warner for $300.0
million in cash and the issuance to Time Warner of a $9.5 million equity
interest in Holdings.
 
   The Company used the net proceeds from the Offering of the Senior Discount
Notes, together with the Equity Contributions and borrowings under the Term
Loans, to consummate the Acquisition. The Company has approximately $209.9
million of indebtedness outstanding and unused commitments under the Revolver
of $40.0 million. Subject to the terms and conditions of the Charter Purchase
Agreement and compliance with the terms of the Senior Credit Facility,
borrowings under the Revolver will be available for working capital purposes,
capital expenditures and acquisitions.
 
   Subject to the terms and provisions of the Charter Purchase Agreement, the
Company expects to make substantial investments in capital to: (i) upgrade its
cable plant; (ii) build line extensions; (iii) purchase new equipment; and
(iv) acquire the equipment necessary to implement its digital and Internet and
data transmission strategy. In 1998, the Company made capital expenditures of
approximately $5.7 million and expects to make capital expenditures of
approximately $16.9 million in 1999. The Company believes that the borrowings
expected to be available under the Revolver and anticipated cash flow from
operations will be sufficient to upgrade the Systems as currently contemplated
and to satisfy the Company's working capital, capital expenditure and debt
service requirements. However, the actual amount and timing of the Company's
capital requirements may differ materially from the Company's estimates as a
result of, among other things, the demand for the Company's services and
regulatory, technological and competitive developments (including additional
market developments and new opportunities) in the Company's industry. The
Company also expects that it will require additional financing if the
Company's development plans or projections change or prove to be inaccurate or
the Company engages in any acquisitions. Sources of additional financing may
include commercial bank borrowings, vendor financing or the private or public
sale of equity or debt securities. There can be no assurances that such
financing will be available on terms acceptable to the Company or at all.
 
   Borrowings under the Senior Credit Facility bear interest at floating
rates, although the Company is required to maintain interest rate protection
programs. Renaissance Media's obligations under the Senior Credit Facility is
secured by substantially all the assets of Renaissance Media.
 
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