8-KRegulation FDExhibits & Filings

VERIZON COMMUNICATIONS INC 8-K Report, Regulation FD Disclosure (Feb 24, 2014)

Filed February 24, 2014For Securities:VZ

Summary

Verizon Communications Inc. (VZ) filed an 8-K on February 24, 2014, primarily to furnish a press release and related schedules. This filing is important for investors as it provides an in-depth look at the company's financial performance and operational metrics, including the use of non-GAAP measures. The company emphasizes the importance of these non-GAAP figures, such as Consolidated EBITDA and Adjusted Earnings Per Share (Adjusted EPS), for a clearer understanding of underlying business trends and operating profitability. Investors should pay close attention to the definitions and calculations of these non-GAAP measures as presented by Verizon, as they are intended to provide a more variable cost basis view and exclude non-operational or non-recurring items. The company asserts that these metrics aid in evaluating operational effectiveness and allow for more meaningful sequential and year-over-year comparisons. This 8-K serves as a crucial document for investors seeking to analyze Verizon's financial health beyond the standard GAAP reporting.

Key Highlights

  • 1Filing primarily furnished a press release and related schedules dated February 24, 2014, as per Regulation FD.
  • 2Verizon utilizes and defines several non-GAAP financial measures to enhance investor understanding of its financial performance.
  • 3Key non-GAAP measures discussed include Consolidated EBITDA, Consolidated EBITDA margin, Consolidated Adjusted Operating Income, Consolidated Adjusted EBITDA, Consolidated Adjusted EBITDA margin, and Adjusted Earnings Per Common Share (Adjusted EPS).
  • 4Management believes these non-GAAP measures provide a better view of operating profitability on a variable cost basis by excluding depreciation, amortization, and other non-operational items.
  • 5The company explains how Consolidated EBITDA is calculated by adding back interest, taxes, depreciation, amortization, equity in earnings, and other income/expense to net income.
  • 6Adjusted EPS is calculated by excluding non-operational or non-recurring items from reported EPS.
  • 7Pension expenses are included in Adjusted Operating Income, Consolidated Adjusted EBITDA, and Adjusted EPS using prior year-end discount rates and expected returns to provide more consistent comparisons.

Frequently Asked Questions

The primary purpose of this 8-K filing is to furnish a press release and related schedules dated February 24, 2014, to the SEC under Regulation FD. This information is intended to provide investors with additional details on Verizon's financial performance and operational metrics.

Non-GAAP measures are financial metrics that are not calculated in accordance with Generally Accepted Accounting Principles (GAAP). Verizon uses them, such as Consolidated EBITDA and Adjusted EPS, to provide investors with a clearer understanding of the company's underlying business trends, operating profitability on a variable cost basis, and to facilitate more meaningful comparisons by excluding non-operational or non-recurring items and certain accounting treatments like pension expenses based on prior year-end rates.

Verizon calculates Consolidated EBITDA by taking net income and adding back interest expense, taxes, depreciation and amortization expense, equity in earnings of unconsolidated businesses, and other income and (expense), net. This measure is used to assess operating profitability on a basis that excludes the impact of significant non-cash charges and financing costs.

Adjusted Earnings Per Common Share (Adjusted EPS) is a non-GAAP measure calculated by excluding the effect of non-operational or non-recurring items from the company's reported Earnings Per Share (EPS). Management believes this provides investors with a more useful view of the company's operating results and underlying trends.