Second Quarter 1996 Earnings Results

BELL ATLANTIC CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Operations (unaudited)
(In millions, except per-share amounts)

Three months Six months
ended June 30, ended June 30,
1996(a) 1995 1996(a) 1995
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OPERATING REVENUES
Transport Services:
Local service $1,179.4 $1,105.3 $2,319.1 $2,186.6
Network access 867.8 872.4 1,745.7 1,693.3
Toll service 350.1 359.3 719.7 726.3
Ancillary Services:
Directory publishing 288.8 276.9 575.0 552.9
Other 148.4 138.0 280.0 272.6
Value-Added Services 386.4 330.9 758.3 657.6
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Network Services Revenues 3,220.9 3,082.8 6,397.8 6,089.3

Wireless Services -- (a) 336.5 -- (a) 628.0
Other Services 38.6 145.2(b) 69.3 296.9(b)
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Total Operating Revenues 3,259.5 3,564.5 6,467.1 7,014.2

OPERATING EXPENSES
Employee costs,
including benefits
and taxes 981.8 1,060.7 1,964.2 2,094.9
Depreciation and amortization 638.8 681.7 1,267.7 1,349.4
Other 837.8 979.1 1,625.8 1,895.4
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Total Operating Expenses 2,458.4 2,721.5(b) 4,857.7 5,339.7(b)

OPERATING INCOME 801.1 843.0 1,609.4 1,674.5

Equity in income
of affiliates (a) 94.3 22.5 165.9 15.8
Other income (expense), net (2.1) 5.8 (4.4) 6.9
Interest expense 119.8 147.7 240.6 286.6
Income before provision
for income taxes 773.5 723.6 1,530.3 1,410.6
Provision for income taxes 279.2 276.5 565.5 549.0

NET INCOME $494.3 $447.1 $964.8 $861.6

EARNINGS PER COMMON SHARE $1.12 $1.02 $2.19 $1.97

CASH DIVIDENDS DECLARED
PER COMMON SHARE $.72 $.70 $1.44(c) $1.40

WEIGHTED AVERAGE NUMBER OF COMMON
AND EQUIVALENT SHARES
OUTSTANDING 439.6 437.7 439.9 437.6

Other Selected Data (unaudited)
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June 30,
1996 1995
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Return on Average Common Equity
Three months ended 27.8% 28.4%
Six months ended 27.5% 27.5%
Total Assets (in millions) $23,795.7 $24,819.9
Total Employees 60,800 72,300 (d)

• (a) On July 1, 1995, the company contributed its domestic cellular business to a partnership and accounts for its share of the partnership's results under the equity method.

  (b) Includes revenues and expenses from Bell Atlantic Business Systems Services, sold in October 1995, as follows:

   

  Three months ended Six months ended
  June 30, 1995 June 30, 1995
  Operating Revenues
  - Other Services $123.1 $246.9
  Operating Expenses 126.1 243.6

  (c) Includes payment of $.005 per common share for redemption of rights granted under the company's Shareholder Rights Plan.

  (d) Total Employees in 1995 includes employees of Bell Atlantic Mobile (3,800), which was contributed to a partnership on July 1, 1995, and Bell Atlantic Business Systems Services (4,200), which was sold in October, 1995. These employees are no longer included at June 30, 1996.

BELL ATLANTIC CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (unaudited)
(In millions)

Six months ended June 30,
1996 1995
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CASH FLOW FROM OPERATING ACTIVITIES
Net income $964.8 $861.6
Depreciation and amortization 1,267.7 1,349.4
Equity in income of affiliates (165.9) (15.8)
Dividends received from affiliates 60.9 5.8
Other, net (243.3) (355.5)

NET CASH PROVIDED BY
OPERATING ACTIVITIES 1,884.2 1,845.5

NET CASH USED IN
INVESTING ACTIVITIES (1,115.8) (1,871.5)

NET CASH USED IN
FINANCING ACTIVITIES (1,061.5) (55.4)

Decrease in Cash
and Cash Equivalents (293.1) (81.4)

Cash and Cash Equivalents,
Beginning of Period 356.8 142.9

Cash and Cash Equivalents,
End of Period $63.7 $61.5

BELL ATLANTIC NYNEX MOBILE CELLULAR OPERATIONS PRO FORMA (unaudited)

The following unaudited pro-forma selected operating and financial data give effect to the combination of Bell Atlantic Mobile and NYNEX Mobile Communications prior to July 1, 1995, and have been adjusted for certain intercompany transactions and the disposition of overlapping properties. These pro-forma results are an approximate representation of Bell Atlantic NYNEX Mobile (BANM) results "as if" the company had been in existence prior to July 1, 1995.

Three months ended June 30,

1996 1995 % change
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Selected Operating Data
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Controlled POPs (1) (000) 55,840 55,840 0.0
Owned POPs (2) (000) 53,788 53,511 0.5
Subscribers (000) 3,822 2,744 39.3
Penetration (3) 6.84% 4.91% 39.2
Churn 1.77% 1.61% 9.9
Revenues per subscriber
per month (4) $62 $67 (7.5)
Acquisition cost
per gross add (5) $201 $223 (9.9)
Cash expense per subscriber $36 $40 (10.0)

Selected Financial Data
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(Dollars in millions)
Operating revenues (6) $631.6 $486.5 29.8
Less: Cost of equipment 81.1 59.4 36.5
Net revenues 550.5 427.1 28.9
Operating income 153.4 109.4 40.2
Pre-tax income (7) 139.7 96.6 44.6
Operating cash flow (8) 236.2 172.2 37.2
Operating cash flow margin 43% 40% 7.5
Capital expenditures
excluding acquisitions 203.6 136.6 49.0

Footnotes:

• (1) Controlled POPs represent the total number of POPs for markets in which BANM has operating control.

  (2) Owned POPs represent BANM percentage ownership in all licensed markets.

  (3) Penetration is calculated by dividing subscribers by controlled POPs.

  (4) Revenue per subscriber is calculated using service revenues, incollect roaming, outcollect roaming and equipment revenue. Incollect roaming revenues were $53.9 million for the three-month period ended 6/30/96 and $40.1 million for the three-month period ended 6/30/95.

  (5) Acquisition costs include commission expense and net margin on sale of customer equipment.

  (6) Operating revenues include service revenues, outcollect roaming, and equipment revenues.

  (7) Pre-tax income represents the income distribution to the two equity partners, Bell Atlantic and NYNEX.

  (8) Operating cash flow equals operating income plus depreciation and amortization.