2005 Financial Review

CONSOLIDATED STATEMENTS OF CASH FLOWS

         
  Years Ended December 31,
(In millions)   2005 2004 2003
Cash flows from operating activities:        
Net income $ 142.4 121.5 29.4
Adjustments to reconcile net income to net cash provided by operating activities:        
(Income) loss from discontinued operations   (105.5) (50.0) 8.5
Cumulative effect of change in accounting principle   5.4 - -
Depreciation and amortization   149.3 133.2 121.0
Impairment charges from subscriber disconnects   45.2 38.4 34.3
Amortization of deferred revenue   (29.5) (26.1) (25.0)
Impairment of other long-lived assets   1.3 0.3 -
Deferred income taxes   11.8 8.6 2.9
Provision for uncollectible accounts receivable   3.6 4.2 3.5
Other operating, net   15.8 16.9 3.4
Postretirement benefit funding (more) less than expense:        
Pension   38.0 14.3 (1.9)
Other than pension   (11.5) (61.8) 8.3
Change in operating assets and liabilities, net of effects of acquisitions:        
Accounts receivable   (42.2) (16.0) 17.7
Accounts payable and accrued liabilities   16.8 26.0 2.2
Deferred subscriber acquisition cost   (22.9) (19.5) (18.4)
Deferred revenue from new subscribers   40.7 34.6 28.2
Other, net   1.1 7.3 10.1
Discontinued operations, net   54.2 53.0 79.5
Net cash provided by operating activities   314.0 284.9 303.7
Cash flows from investing activities:        
Capital expenditures   (271.7) (194.9) (179.1)
Cash proceeds from:        
Disposal of former natural resource interests   5.0 28.6 119.4
Disposal of other property and equipment   3.8 8.8 17.4
Monetization of notes receivable and royalty agreement related to sale of former coal operations   - - 26.0
Acquisitions   (53.2) (14.8) (7.2)
Contributions to Voluntary Employees’ Beneficiary Association trust   - - (82.0)
Other, net   (6.3) (1.1) (0.8)
Discontinued operations, net   (72.8) (49.1) (55.9)
Net cash used by investing activities   (395.2) (222.5) (162.2)
Cash flows from financing activities:        
Long-term debt:        
Additions   211.9 89.5 80.1
Repayments   (139.3) (118.4) (180.0)
Short-term borrowings (repayments), net   14.0 (7.9) (14.3)
Proceeds from exercise of stock options   28.3 24.2 1.7
Dividends   (5.5) (5.4) (5.3)
Dividends to minority interest holders in subsidiaries   (6.7) (4.8) (2.9)
Other, net   (1.4) (1.8) (0.6)
Discontinued operations, net   (7.7) (2.3) (4.6)
Net cash provided (used) by financing activities   93.6 (26.9) (125.9)
Effect of exchange rate changes on cash   (6.6) 4.8 10.8
Net increase in cash and cash equivalents   5.8 40.3 26.4
Cash and cash equivalents included in assets held for sale   (78.6) - -
Cash and cash equivalents at beginning of year   169.0 128.7 102.3
Cash and cash equivalents at end of year $ 96.2 169.0 128.7

See accompanying notes to consolidated financial statements.