Cincinnati Bell 2011 Annual Report Download - page 88

ANNEX A
Cincinnati Bell Inc.
Reconciliation of GAAP and Non-GAAP Financial Measures
The Company reports its financial results in accordance with accounting principles generally accepted in the
United States (“GAAP” or referred to herein as “reported”). However, management believes that certain
non-GAAP financial measures provide users with additional meaningful financial information that should be
considered when assessing our ongoing performance. Management uses these non-GAAP financial measures in
making financial, operating and planning decisions and in evaluating the Company’s performance. Non-GAAP
financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results
prepared in accordance with GAAP. Management also believes non-GAAP financial measures should not be
construed as being more important than comparable GAAP measures.
For additional details regarding the reconciliation of GAAP and non-GAAP financial measures below, see
the Company’s Current Reports on Form 8-K filed with the SEC on February 9, 2012 and February 15, 2011.
This information is also available in the “Investor Relations” section of the Company’s website,
www.cincinnatibell.com.
Twelve Months Ended
December 31,
(dollars in millions) 2011 2010
Net Income (GAAP) $ 18.6 $ 28.3
Add:
Income tax expense ................................................... 25.0 38.9
Loss on extinguishment of debt .......................................... — 46.5
Interest expense ...................................................... 215.0 185.2
Other expense, net .................................................... 0.9 0.4
Operating Income (GAAP) $259.5 $299.3
Add:
Depreciation and amortization ........................................... 199.5 179.5
Restructuring charges ................................................. 12.2 13.7
Gain on sale of assets .................................................. (8.4) —
Impairment of goodwill and asset impairments ............................. 52.4 —
Acquisition costs ..................................................... 2.6 9.1
Legal claim costs ..................................................... 1.6 —
Curtailment loss ...................................................... 4.2 —
Adjusted EBITDA (Non-GAAP, as previously defined) ........................ $523.6 $501.6
Pension and other retirement plan expenses .................................... 21.1 17.3
Adjusted EBITDA (Non-GAAP, as currently defined) ......................... $544.7 $518.9
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