Frontier Communications 2012 Annual Report Download - page 81

Download and view the complete annual report

Please find page 81 of the 2012 Frontier Communications annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

During 2012, the Company entered into a sale and leaseback arrangement for a facility in Everett,
Washington and entered into a capital lease for the use of fiber in the state of Minnesota. These agreements
have lease terms of 12 and 23 years, respectively. These capital lease obligations as of December 31, 2012 are
included in our consolidated balance sheet within “Other liabilities” and “Other current liabilities.”
Future minimum payments for finance lease obligations and capital lease obligations as of December 31,
2012 are as follows:
($ in thousands)
Finance Lease
Obligations
Capital Lease
Obligations
Year ending December 31:
2013 ............................................................ $ 5,339 $ 3,055
2014 ............................................................ 5,170 3,107
2015 ............................................................ 5,276 3,161
2016 ............................................................ 5,407 3,216
2017 ............................................................ 5,550 3,273
Thereafter . . . ...................................................... 54,274 22,387
Total future payments . ............................................. $81,016 38,199
Less: Amounts representing interest ................................. (11,603)
Present value of minimum lease payments........................... $ 26,596
(8) Investment Income:
The components of investment income for the years ended December 31, 2012, 2011 and 2010 are as
follows:
($ in thousands) 2012 2011 2010
Interest and dividend income ....................................... $ 3,753 $2,184 $3,471
Investment gain. ................................................... 9,780 1,071 3,010
Equity earnings (loss) .............................................. (522) (864) 367
Total investment income . .......................................... $13,011 $2,391 $6,848
During 2012, we recognized a gain of $9.8 million associated with cash received in connection with our
previously written-off investment in Adelphia.
(9) Other Income (Loss), Net:
The components of other income (loss), net for the years ended December 31, 2012, 2011 and 2010 are as
follows:
($ in thousands) 2012 2011 2010
Gain on expiration/settlement of customer advances, net . . . ......... $ 7,798 $7,605 $ 4,973
Litigation settlement proceeds . .................................... 854 1,495 3,364
Split-dollar life insurance policy settlement ......................... — — 4,454
All other, net ..................................................... (1,531) 35 899
Total other income (loss), net. . .................................... $ 7,121 $9,135 $13,690
During 2012, 2011 and 2010, we recognized income of $7.8 million, $7.6 million and $5.0 million,
respectively, in connection with certain retained liabilities that have terminated, associated with customer
advances for construction from our disposed water properties.
During 2012, 2011 and 2010, we recognized $0.9 million, $1.5 million and $3.4 million, respectively, in
settlement proceeds related to litigation arising from businesses that the Company exited several years ago.
During 2010, we recognized a gain of $4.5 million on the settlement of a split-dollar life insurance policy.
F-20
FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements