ATLANTA - Cox Communications, Inc. (NYSE: COX) today reported financial results for the three months ended March 31, 2002.

"We had a remarkable first quarter, with strong pro forma operating cash flow (OCF) growth of 12% fueled by basic subscriber growth of 1.3% and continued strength in the rollout of new services," said Jim Robbins, President and Chief Executive Officer.

"Our momentum continued in the first quarter, as we achieved two new-service milestones. First, we were proud to announce that we reached 500,000 Cox Digital Telephone subscribers in the first quarter-further validation that our decision to enter the circuit-switched telephony business was a winning one. We also reached new heights with our high-speed Internet service, surpassing one million subscribers."

Robbins continued: "We now have three million new-service revenue generating units (RGUs), with the addition of about 336,000 new-service RGUs in the first quarter of 2002 versus 317,000 in the fourth quarter of 2001. These numbers effectively demonstrate our strength at our current size, and that we do not need to grow through acquisitions simply for the sake of scale. As we've always said, we will make acquisitions opportunistically, that make sense both financially and operationally.

"2002 will be a defining year for Cox, when we expect to see the cumulative benefits of our concentrated focus on technology, customer care and people. We believe we have the best execution strategy and the best management team in the industry, a strong balance sheet and a steadfast commitment to providing quality customer service, all of which contribute to our continued success and growth.

"Cox expects to remain on track to achieve its previously stated year-end 2002 financial guidance of operating cash flow growth of 13% to 14% over 2001; total revenue growth of 14% to 15% over 2001; and capital expenditures of approximately $2 billion." Robbins also added that the company added 1.15 million new-service RGUs in 2001 and is in line to maintain or exceed that pace.

PRO FORMA OPERATING RESULTS

Cox provides pro forma information as an alternative for understanding our operating results. The pro forma operating results are not necessarily indicative of operating results that would have occurred if the circumstances summarized below had not occurred, and may be different from pro forma measures used by other companies. In addition, the pro forma operating results are not necessarily indicative of the results of our future operations.

The pro forma operating results for the three months ended March 31, 2002 exclude a one-time non-recurring charge of $9.8 million related to the portion of Cox's December 2001 payment of $160.0 million to Excite@Home for the continuation of high-speed Internet services through February 2002. Please refer to the Pro Forma Operating Results for additional details on this non-recurring item.

The pro forma operating results for the three months ended March 31, 2001 reflect a reclassification of $17.2 million in costs associated with Excite@Home high-speed Internet service which had previously been netted against data revenue and $1.1 million of such costs which had previously been netted against commercial revenue to selling, general and administrative expenses in order to conform to the manor in which the costs associated with Cox High Speed Internet service have been presented.

Total pro forma revenues for the first quarter of 2002 increased 17% over the first quarter of 2001, and include the effects of:

• basic and digital video customer growth;
• residential basic rate increases implemented over the past twelve months resulting from increased programming costs and increased channel availability;
• residential and commercial high-speed Internet access and telephony customer growth; and
• a slight rebound in local and national advertising sales.

Cox Digital Cable added approximately 155,500 customers in the first quarter of 2002, and is now available in 95% of the homes in Cox's service areas with penetration of total-basic customers of 25%. High-speed Internet and Cox Digital Telephone customers increased by approximately 117,700 and 62,700, respectively, in the first quarter of 2002, and by approximately 414,000 and 224,000, respectively, as compared to March 31, 2001. In addition, basic customers were 6,292,093 at March 31, 2002, a 1.3% increase over the prior year.

Pro forma programming costs were $263.9 million for the first quarter of 2002, an increase of 12% over the same period in 2001 primarily due to programming rate increases implemented over the past twelve months, basic and digital customer growth and channel additions. Pro forma selling, general and administrative expenses for the first quarter of 2002 increased 23% to $512.3 million due to:

• marketing costs related to campaigns commencing in the third quarter of 2001 aimed at enhancing customer awareness, the promotion of new services and bundling alternatives and the acquisition of new customers;
• labor costs due to the transition from upgrade construction and new product launches to increased maintenance and related customer transaction costs directly associated with the growth in new service subscribers;
• incremental operating costs associated with the transition to Cox High Speed Internet service; and
• bad debt expense due to the lagging effects of the general economic slowdown.

Pro forma operating cash flow increased 12% to $401.8 million for the first quarter of 2002. The pro forma operating cash flow margin (pro forma operating cash flow as a percentage of revenues) for the first quarter of 2002 was 34.1%.

HISTORICAL OPERATING RESULTS

Total revenues for first quarter of 2002 were $1,178.0 million, a 19% increase over revenues of $991.4 million for the first quarter of 2001. Operating cash flow increased 9% to $392.1 million for the first quarter of 2002. Operating cash flow growth is offset by a one-time non-recurring charge of $9.8 million related to the continuation of Excite@Home high-speed Internet services.

Depreciation and amortization decreased to $325.8 million from $352.2 million in the first quarter of 2001 due to a reduction in amortization from adoption of Statement of Financial Accounting Standards (SFAS) No. 142, offset by an increase in depreciation from Cox's continuing investments in its broadband network in order to deliver additional programming and services. Interest expense decreased to $127.6 million primarily due to decreased interest rates on floating rate debt, interest savings as a result of Cox's interest rate swap agreements and repayments of commercial paper borrowings.

For the first quarter of 2002, Cox recorded a $719.8 million pre-tax gain on derivative instruments due to the following:

• $287.2 million resulting from the change in the fair value of certain derivative instruments embedded in Cox's exchangeable subordinated debentures and indexed to shares of Sprint PCS common stock that Cox owns;
• $226.3 million resulting from the change in the fair value of certain derivative instruments embedded in Cox's zero-coupon debt and indexed to shares of Sprint PCS common stock; and
• $206.3 million resulting from the change in the fair value of certain derivative instruments associated with Cox's investments, including Sprint PCS, AT&T and AT&T Wireless.

Net loss on investments of $408.7 million is primarily due to a $170.4 million pre-tax loss related to the sale of 23.9 million shares of AT&T Wireless common stock and a $275.3 million pre-tax loss as a result of the change in market value of Cox's investment in Sprint PCS common stock classified as trading.

Minority interest of $12.1 million primarily represents distributions on Cox's obligated capital and preferred securities of subsidiary trusts, referred to as FELINE PRIDES and RHINOS. Net income for the current quarter was $135.6 million compared to net income of $686.6 million for the first quarter of 2001.

NEW ACCOUNTING STANDARD

On January 1, 2002, Cox adopted SFAS No. 142, which requires that goodwill and certain intangible assets, including those recorded in past business combinations, no longer be amortized through the statement of operations, but instead be tested for impairment at least annually. The adoption of SFAS No. 142 did not result in an impairment charge.

Also on January 1, 2002, Cox began applying the guidance prescribed in FASB Staff Announcement D-103, whereby the collection and payment of certain fees must be presented on a gross basis, as revenue and expense, rather than on a net basis. Retroactive application of this announcement is required. Accordingly, collection and payment of fees, primarily franchise fees, have been reclassified on a gross basis for all historical and pro forma periods presented herein to conform to this new guidance.

LIQUIDITY AND CAPITAL RESOURCES

Significant sources of cash for the first quarter of 2002 consisted of the following:

• the sale of 25.2 million shares of Sprint PCS common stock for net proceeds of approximately $238.7 million;
• the sale of 35.0 million shares of AT&T common stock for net proceeds of approximately $542.6 million;
• the sale of 23.9 million shares of AT&T Wireless common stock for net proceeds of approximately $248.2 million; and
• the termination all costless equity collar arrangements with respect to Sprint PCS common stock, AT&T common stock and AT&T Wireless common stock for aggregate proceeds of approximately $264.4 million.

As a result of Cox's first quarter sales described above, Cox no longer owns any shares of AT&T common stock or AT&T Wireless common stock.

Significant uses of cash for the first quarter of 2002 consisted of the following:

• the repurchase of $329.1 million aggregate principal amount at maturity of Cox's convertible senior notes due 2021 that had been properly tendered and not withdrawn, for aggregate cash consideration of $232.8 million, which represented the accreted value of the repurchased notes;
• the aggregate cash payment of $7.5 million to the remaining holders of the convertible notes who elected not to require Cox to repurchase their convertible notes;
• the repayment of approximately $727.4 million of commercial paper borrowings; and
• capital expenditures of approximately $515.4 million to upgrade and rebuild Cox's broadband network.

At March 31, 2002, Cox had approximately $6.9 billion of outstanding indebtedness, net of cumulative derivative adjustments made in accordance with SFAS No. 133 which reduced reported indebtedness by approximately $1.1 billion, and $1.3 billion of Cox-obligated capital and preferred securities of subsidiary trusts.

Acerca de Cox Communications

Cox Communications (NYSE: COX), a Fortune 500 company, is a multi-service broadband communications company serving approximately 6.3 million customers nationwide. Cox is the nation's fifth-largest cable television provider, and offers both traditional analog video programming under the Cox Cable brand as well as advanced digital video programming under the Cox Digital Cable brand. Cox provides an array of other communications and entertainment services, including local and long distance telephone under the Cox Digital Telephone brand; high-speed Internet access under the brands Cox High Speed Internet, Road Runner and Cox Express; and commercial voice and data services via Cox Business Services. Cox is an investor in programming networks including Discovery Channel. More information about Cox Communications can be accessed on the Internet at www.cox.com/espanol.

Conference Call and Webcast Details

The Cox Communications earnings call will be held Monday, April 22, 2002, at 10:30 a.m. Eastern Time. A live webcast of the conference call will be available on the Cox Communications website at www.cox.com/investor. A recording of the conference call will remain on the company's website for two weeks following the conclusion of the call. A document containing highlights from the first quarter can be found in the press room on our website at www.cox.com/espanol.

Información de contacto
Amy Cohn, Director of Corporate Communications
(404) 843-5769, amy.cohn@cox.com

Laura Oberhelman, Manager of Corporate Communications
(404) 269-7562, laura.oberhelman@cox.com

Caution Concerning Forward-Looking Statements

Statements in this release, including statements relating to growth opportunities, revenue and cash flow projections and introduction of new products and services, are "forward-looking" statements, which are statements that relate to Cox's future plans, earnings, objectives, expectations, performance and similar projections, as well as any facts or assumptions underlying these statements or projections. Actual results may differ materially from the results expressed or implied in these forward-looking statements, due to various risks, uncertainties or other factors. These factors include competition within the broadband communications industry, our ability to achieve anticipated subscriber and revenue growth, our success in implementing new services and other operating initiatives, our ability to generate sufficient cash flow to meet our debt service obligations and finance operations, and other risk factors described from time to time in Cox's filings with the Securities and Exchange Commission, including Cox's Annual Report on Form 10-K, as amended, for the year ended December 31, 2001. Cox assumes no responsibility to update any forward-looking statements as a result of new information, future events or otherwise.

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(See attached financial information)