AT&T Canada Reports Record Fourth Quarter 1999 Financial and Operating Results - Company Financial Information

Cambridge Telcom Report, Feb 21, 2000

(1) On June 1, 1999 MetroNet Communications and AT&T Canada Long Distance Services merged into a new company called AT&T Canada Inc. In accordance with GAAP, results prior to the June 1, 1999 merger do not include the results of operations of AT&T Canada Long Distance Services. All share and per share amounts reflect a two-for-one stock split which occurred during fourth quarter 1999.

(2) Net Loss per share for 1999 includes a one time accounting gain for the sale of a 31% minority interest in subsidiary to AT&T Corp. and integration cost related to mergers, which had the effect of increasing (decreasing) net loss per share by ($3.46) and $1.17, respectively. Net Loss per share for 1998 includes integration costs related to acquisition which had the effect of increasing net loss per share by $0.13.

(3) Minority interest derives primarily from ownership by AT&T Corp. and BT in AT&T Canada Corp., the company's principal operating subsidiary, equivalent to approximately 43.7 million shares of the company.

(4) Fully diluted shares include unexercised options and warrants, as well as the ownership in AT&T Canada Corp. held by AT&T Corp. and BT.

(5) EBITDA is earnings before interest, taxes, depreciation, amortization and nonrecurring integration costs and is commonly used as a measure to assist in understanding operating results.

                        AT&T CANADA INC. (1)
        Unaudited Condensed Consolidated Balance Sheets
                       (Dollars in thousands)

                                       December 31,    December 31,
                                          1999            1998
                                       ------------    ------------
Cash and short term deposits           $  289,331      $  854,729
Other current assets                      274,707          93,033
                                       ------------    ------------
                                          564,038         947,762

Property, plant and equipment           2,174,825         870,819
Accumulated depreciation                 (242,527)        (37,945)
                                       ------------    ------------
                                        1,932,298         832,874

Goodwill                                1,547,947         678,828
Other assets, net                         122,509         198,247
                                       ------------    ------------
  Total assets                         $4,166,792      $2,657,711
                                       ------------    ------------
                                       ------------    ------------
Current liabilities                    $  496,301      $   96,017
Long-term borrowings                    2,865,205       1,882,424
Minority interest (2)                     104,274               -
                                       ------------    ------------
                                        3,465,780       1,978,441

Share capital                             958,509         931,481
Retained earnings (deficit)              (257,497)       (252,211)
                                       ------------    ------------
Shareholders' equity                      701,012         679,270
                                       ------------    ------------
                                       ------------    ------------
  Total liabilities and shareholders'
    equity                             $4,166,792      $2,657,711
                                       ------------    ------------
                                       ------------    ------------