##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q

(Mark One)x
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31, 2003o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from __________ to  __________


Commission File Number 1-6590

(COX LOGO)Cox Communications, Inc.

(Exact name of registrant as specified in its charter)


Delaware
    
    58-2112281(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)1400 Lake Hearn Drive, Atlanta, Georgia
    
    30319(Address of principal executive offices)
    
    (Zip Code)


Registrants telephone number, including area code: (404) 843-5000



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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.    Yes x   No o

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).    Yes x   No o

There were 592,657,908 shares of Class A Common Stock and 27,597,792
shares of Class C Common Stock
outstanding as of May 1, 2003.



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TABLE OF CONTENTS



|                                                                                                        |                                                                                               |  |  |  |  |  |  | 
|------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|Part I  Financial Information                                                                         
|                                                                                                        | Item 1. Condensed Consolidated Financial Statements                                          
|                                                                                                        | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                                                                                        | Item 3. Quantitative and Qualitative Disclosures About Market Risk                           
|                                                                                                        | Item 4. Disclosure Controls and Procedures                                                   
|Part II  Other Information                                                                            
|                                                                                                        | Item 1. Legal Proceedings                                                                    
|                                                                                                        | Item 2. Changes in Securities and Use of Proceeds                                            
|                                                                                                        | Item 6. Exhibits and Reports on Form 8-K                                                     
|SIGNATURES                                                                                             
|CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934
|CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934
|EX-99.1 Section 906 Certification of the CEO                                                           
|EX-99.2 Section 906 Certification of the CFO                                                           



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##### Table of Contents



Cox Communications, Inc.
Form 10-Q
For the Quarter Ended March 31, 2003

Table of Contents

PagePart I  Financial InformationItem 1.
    
    Condensed Consolidated Financial Statements
    
    
    2Item 2.
    
    Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    19Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 4.
    
    Disclosure Controls and Procedures
    
    
    26Part II  Other InformationItem 1.
    
    Legal Proceedings
    
    
    26Item 2.
    
    Changes in Securities and Use of Proceeds
    
    
    26Item 6.
    
    Exhibits and Reports on Form 8-K
    
    
    27Signatures
    
    
    28Certification of Chief Executive Officer Pursuant to Rule 13a-14 of the Securities
Exchange Act of 1934
    
    
    29Certification of Chief Financial Officer Pursuant to Rule 13a-14 of the Securities
Exchange Act of 1934
    
    
    30






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##### Table of Contents






Part I  Financial Information




Item 1.     Condensed Consolidated Financial Statements

Cox Communications, Inc.
Condensed Consolidated Balance Sheets

March 31
    
    December 312003
    
    2002(unaudited)(Thousands of Dollars)AssetsCurrent assetsCash
    
    $
    120,868
    
    
    $
    228,704Accounts and notes receivable, less allowance for doubtful
accounts of $27,170 and $33,607
    
    
    318,352
    
    
    
    354,928Amounts due from Cox Enterprises, Inc. (CEI)
    
    
    
    
    
    
    21,109Other current assets
    
    
    294,959
    
    
    
    267,341Total current assets
    
    
    734,179
    
    
    
    872,082Net plant and equipment
    
    
    7,764,822
    
    
    
    7,793,178Investments
    
    
    429,234
    
    
    
    397,435Intangible assets
    
    
    15,695,876
    
    
    
    15,724,288Other noncurrent assets
    
    
    215,685
    
    
    
    218,166Total assets
    
    $
    24,839,796
    
    
    $
    25,005,149Liabilities and shareholders equityCurrent liabilitiesAccounts payable and accrued expenses
    
    $
    658,383
    
    
    $
    727,877Other current liabilities
    
    
    224,200
    
    
    
    216,235Current portion of long-term debt
    
    
    90,356
    
    
    
    393,040Amounts due to CEI
    
    
    49,821
    
    
    
    Total current liabilities
    
    
    1,022,760
    
    
    
    1,337,152Deferred income taxes
    
    
    6,785,928
    
    
    
    6,750,635Other noncurrent liabilities
    
    
    186,516
    
    
    
    175,912Long-term debt, less current portion
    
    
    7,028,342
    
    
    
    6,922,957Total liabilities
    
    
    15,023,546
    
    
    
    15,186,656Commitments and contingencies (Note 10)Minority interest in equity of consolidated subsidiaries
    
    
    135,673
    
    
    
    133,403Shareholders equitySeries A preferred stock  liquidation preference of $22.1375
per share, $1 par value; 10,000,000 shares of preferred stock
authorized; shares issued and outstanding: 4,836,372
    
    
    4,836
    
    
    
    4,836Class A common stock, $1 par value; 671,000,000 shares
authorized; shares issued: 598,164,557 and 598,076,894; shares
outstanding: 592,643,914 and 592,567,757
    
    
    598,164
    
    
    
    598,077Class C common stock, $1 par value; 62,000,000 shares
authorized; shares issued and outstanding: 27,597,792
    
    
    27,598
    
    
    
    27,598Additional paid-in capital
    
    
    4,551,193
    
    
    
    4,549,029Retained earnings
    
    
    4,609,201
    
    
    
    4,638,422Accumulated other comprehensive income
    
    
    102,251
    
    
    
    79,465Class A common stock in treasury, at cost: 5,520,643 and 5,509,137
shares
    
    
    (212,666
    )
    
    
    (212,337
    )Total shareholders equity
    
    
    9,680,577
    
    
    
    9,685,090Total liabilities and shareholders equity
    
    $
    24,839,796
    
    
    $
    25,005,149


See notes to condensed consolidated financial statements.

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Cox Communications, Inc.
Condensed Consolidated Statements of Operations

Three MonthsEnded March 312003
    
    2002(unaudited)(Thousands of Dollars, excluding share data)RevenuesResidentialVideo
    
    $
    898,942
    
    
    $
    833,859Data
    
    
    194,218
    
    
    
    121,565Telephony
    
    
    107,093
    
    
    
    72,752Other
    
    
    22,152
    
    
    
    20,545Total residential revenues
    
    
    1,222,405
    
    
    
    1,048,721Commercial
    
    
    63,369
    
    
    
    49,795Advertising
    
    
    80,508
    
    
    
    79,526Total revenues
    
    
    1,366,282
    
    
    
    1,178,042Costs and expensesCost of services (excluding depreciation)
    
    
    583,616
    
    
    
    507,384Selling, general and administrative expenses
    
    
    303,212
    
    
    
    278,593Depreciation and amortization
    
    
    384,320
    
    
    
    325,792Operating income
    
    
    95,134
    
    
    
    66,273Interest expense
    
    
    (129,824
    )
    
    
    (127,617
    )Gain (loss) on derivative instruments, net
    
    
    (2,503
    )
    
    
    719,763Loss on investments, net
    
    
    (1,751
    )
    
    
    (408,730
    )Equity in net losses of affiliated companies
    
    
    (2,164
    )
    
    
    (2,813
    )Other, net
    
    
    (341
    )
    
    
    735Income (loss) before income taxes and
minority interest
    
    
    (41,449
    )
    
    
    247,611Income tax expense (benefit)
    
    
    (14,498
    )
    
    
    99,970Income (loss) before minority interest
    
    
    (26,951
    )
    
    
    147,641Minority interest, net of tax
    
    
    (2,270
    )
    
    
    (12,069
    )Net income (loss)
    
    $
    (29,221
    )
    
    $
    135,572Share dataBasic net income (loss) per shareBasic weighted-average shares outstanding
    
    
    620,223,074
    
    
    
    600,726,931Basic net income (loss) per share
    
    $
    (0.05
    )
    
    $
    0.23Diluted net income (loss) per shareDiluted weighted-average shares outstanding
    
    
    620,223,074
    
    
    
    608,036,632Diluted net income (loss) per share
    
    $
    (0.05
    )
    
    $
    0.22


See notes to condensed consolidated financial statements.

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Cox Communications, Inc.
Condensed Consolidated Statement of Shareholders Equity

Class AAccumulated
    
    CommonSeries A
    
    Common Stock
    
    Additional
    
    
    
    
    
    Other
    
    Stock inPreferred
    
    
    
    Paid-in
    
    Retained
    
    Comprehensive
    
    Treasury,
    
    
    
    
    
    ComprehensiveStock
    
    Class A
    
    Class C
    
    Capital
    
    Earnings
    
    Income
    
    at Cost
    
    Total
    
    Income (Loss)(unaudited)(Thousands of Dollars)December 31, 2002
    
    $
    4,836
    
    
    $
    598,077
    
    
    $
    27,598
    
    
    $
    4,549,029
    
    
    $
    4,638,422
    
    
    $
    79,465
    
    
    $
    (212,337
    )
    
    $
    9,685,090Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (29,221
    )
    
    
    
    
    
    
    
    
    
    
    (29,221
    )
    
    $
    (29,221
    )Issuance of stock related to
stock compensation plans (including tax
benefit on stock options exercised)
    
    
    
    
    
    
    87
    
    
    
    
    
    
    
    2,164
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,251Shares surrendered in connection
with vesting of restricted stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (329
    )
    
    
    (329
    )Change in net accumulated unrealized
gain on securities, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,786Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,786
    
    
    
    
    
    
    
    22,786
    
    
    
    22,786Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (6,435
    )March 31, 2003
    
    $
    4,836
    
    
    $
    598,164
    
    
    $
    27,598
    
    
    $
    4,551,193
    
    
    $
    4,609,201
    
    
    $
    102,251
    
    
    $
    (212,666
    )
    
    $
    9,680,577


See notes to condensed consolidated financial statements.

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Cox Communications, Inc.
Condensed Consolidated Statements of Cash Flows

Three MonthsEnded March 312003
    
    2002(unaudited)(Thousands of Dollars)Cash flows from operating activitiesNet income (loss)
    
    $
    (29,221
    )
    
    $
    135,572Adjustments to reconcile net income (loss) to net cash provided by
operating activities:Depreciation and amortization
    
    
    384,320
    
    
    
    325,792(Gain) loss on derivative instruments, net
    
    
    2,503
    
    
    
    (719,763
    )Deferred income taxes
    
    
    21,028
    
    
    
    131,176Loss on investments, net
    
    
    1,751
    
    
    
    408,730Equity in net losses of affiliated companies
    
    
    2,164
    
    
    
    2,813Minority interest, net of tax
    
    
    2,270
    
    
    
    12,069Decrease in accounts and notes receivable
    
    
    36,575
    
    
    
    29,096Decrease in other assets
    
    
    21,152
    
    
    
    1,349Decrease in accounts payable and accrued expenses
    
    
    (84,097
    )
    
    
    (17,556
    )Increase (decrease) in taxes payable
    
    
    (37,549
    )
    
    
    66,238Other, net
    
    
    34,970
    
    
    
    45,220Net cash provided by operating activities
    
    
    355,866
    
    
    
    420,736Cash flows from investing activitiesCapital expenditures
    
    
    (325,684
    )
    
    
    (515,398
    )Investments in affiliated companies
    
    
    (2,949
    )
    
    
    (3,549
    )Proceeds from the sale of investments
    
    
    
    
    
    
    1,316,276(Increase) decrease in amounts due from CEI
    
    
    21,109
    
    
    
    (232,042
    )Other, net
    
    
    (3,218
    )
    
    
    (2,143
    )Net cash provided by (used in) investing activities
    
    
    (310,742
    )
    
    
    563,144Cash flows from financing activitiesCommercial paper borrowings (repayments), net
    
    
    98,210
    
    
    
    (727,384
    )Repayment of debt
    
    
    (315,739
    )
    
    
    (252,969
    )Proceeds from exercise of stock options
    
    
    1,286
    
    
    
    2,761Distributions paid on capital and preferred securities of
subsidiary trusts
    
    
    
    
    
    
    (15,472
    )Increase in amounts due to CEI
    
    
    49,821
    
    
    
    Other, net
    
    
    13,462
    
    
    
    57,418Net cash used in financing activities
    
    
    (152,960
    )
    
    
    (935,646
    )Net increase (decrease) in cash
    
    
    (107,836
    )
    
    
    48,234Cash at beginning of period
    
    
    228,704
    
    
    
    86,860Cash at end of period
    
    $
    120,868
    
    
    $
    135,094


See notes to condensed consolidated financial statements.

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Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)

Quarter Ended March 31, 2003

1.     Organization and Basis of Presentation

Cox Communications, Inc. (Cox), an indirect 63.4% majority-owned
subsidiary of Cox Enterprises, Inc. (CEI), is a multi-service broadband
communications company serving approximately 6.5 million customers nationwide.
Cox is the nations fourth largest cable television provider and offers an
array of broadband products and services to both residential and commercial
customers in its markets. These services primarily include analog and digital
video, high-speed Internet access and local and long-distance telephone. Cox
operates in one operating segment, broadband communications.

The accompanying unaudited condensed consolidated financial statements of
Cox have been prepared in accordance with accounting principles generally
accepted in the United States of America (GAAP) for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnote
disclosures required by GAAP for complete financial statements. In the opinion
of management, the condensed consolidated financial statements reflect all
adjustments considered necessary for a fair statement of the consolidated
results of operations and financial position for the interim periods presented.
All such adjustments are of a normal recurring nature. These unaudited interim
condensed consolidated financial statements should be read in conjunction with
the audited consolidated financial statements and notes thereto contained in
Coxs Annual Report on Form 10-K for the year ended December 31, 2002.

2.     Summary of Significant Accounting Policies

The following is a summary of certain significant accounting policies.
For a detailed description of all of Coxs significant accounting policies, see
Note 2. Summary of Significant Accounting Policies and Other Items contained
in Coxs Annual Report on Form 10-K for the year ended December 31, 2002.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from
those estimates. The results of operations for the interim periods presented
are not necessarily indicative of the results to be expected for the year
ending December 31, 2003 or any other interim period.

Stock Compensation Plans

At March 31, 2003, Cox had two stock-based compensation plans for
employees, a Long-Term Incentive Plan (LTIP) and an Employee Stock Purchase
Plan (ESPP), which are more fully described in Coxs Annual Report on Form 10-K
for the year ended December 31, 2002. Cox accounts for those plans under the
intrinsic value method, which follows the recognition and measurement
principles of Accounting Principles Board (APB) Opinion No. 25, Accounting for
Stock Issued to Employees, and related interpretations. No stock-based
employee compensation cost is reflected in net income, as all options granted
under the LTIP had an exercise price equal to or greater than the market value
of the underlying common stock on the grant date. Further, the ESPP is a
noncompensatory plan under APB Opinion No. 25, and, as such, no compensation
cost was recognized with respect to the ESPP.

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Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

The following table illustrates the effect on net income (loss) and net
income (loss) per share if Cox had applied the fair value recognition
provisions of Statement of Financial Accounting Standards (SFAS) No. 123,
Accounting for Stock-Based Compensation, to stock-based employee compensation:

Three Months Ended March 312003
    
    2002(Thousands of Dollars,excluding per share data)Net income (loss), as reported
    
    $
    (29,221
    )
    
    $
    135,572Add: Stock-based compensation, as reported
    
    
    
    
    
    
    Deduct: Total stock-based compensation
determined under fair value based method
for all awards, net of tax
    
    
    (4,765
    )
    
    
    (5,463
    )Pro forma net income (loss)
    
    $
    (33,986
    )
    
    $
    130,109Earnings (loss) per share:Basic earnings (loss) per share  as reported
    
    $
    (0.05
    )
    
    $
    0.23Basic earnings (loss) per share  pro forma
    
    
    (0.05
    )
    
    
    0.22Diluted earnings (loss) per share  as reported
    
    $
    (0.05
    )
    
    $
    0.22Diluted earnings (loss) per share  pro forma
    
    
    (0.05
    )
    
    
    0.21


Recently Issued Accounting Pronouncements

In January 2003, the Financial Accounting Standards Board (FASB) issued
FASB Interpretation No. 46, Consolidation of Variable Interest Entities.
Interpretation No. 46 addresses consolidation by business enterprises of
variable interest entities, which are entities that either (a) do not have
equity investors with vesting rights or (b) have equity investors that do not
provide sufficient financial resources for the entity to support its
activities. The interpretation is effective for the first interim or annual
reporting period beginning after June 15, 2003 for existing variable interest
entities and is effective immediately for variable interest entities created
after January 31, 2003. Cox does not currently hold any interest in variable
interest entities.

Reclassifications

Certain amounts in the 2002 condensed consolidated financial statements
have been reclassified for comparative purposes.

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Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

3.     Investments

March 31
    
    December 312003
    
    2002(Thousands of Dollars)Investments stated at fair value:Available-for-sale
    
    $
    299,166
    
    
    $
    262,939Trading
securities
    
    
    85,020
    
    
    
    85,410Derivative
instruments
    
    
    1,854
    
    
    
    6,137Equity method investments
    
    
    33,100
    
    
    
    31,714Investments stated at
cost
    
    
    10,094
    
    
    
    11,235Total
investments
    
    $
    429,234
    
    
    $
    397,435


Investments Stated at Fair Value

The aggregate cost of Coxs investments stated at fair value at March 31,
2003 and December 31, 2002 was $174.2 million and $175.0 million, respectively.
Gross unrealized gains on investments were $166.3 million at March 31, 2003,
and gross unrealized gains and losses on investments were $129.6 million and
$0.4 million, respectively, at December 31, 2002. For the three months ended
March 31, 2003, gross realized losses on investments stated at fair value were
$1.8 million. For the three months ended March 31, 2002, gross realized gains
and losses on investments stated at fair value were $37.0 million and $445.7
million, respectively. Derivative instruments classified within investments
are comprised of certain warrants to purchase shares of publicly-traded and
privately-held entities, as further described in Note 6. Derivative
Instruments and Hedging Activities.

Sprint PCS.At March 31, 2003, Coxs investment in Sprint Corporations
PCS Group (Sprint PCS) was comprised of 66.7 million shares of Sprint PCS
common stock and warrants and convertible preferred stock, which are
exercisable for or convertible into approximately 10.3 million shares of Sprint
PCS common stock. The estimated fair value of Coxs investment in Sprint PCS
was $345.4 million and $349.2 million at March 31, 2003 and December 31, 2002,
respectively.

In April 2003, Cox sold its Sprint PCS warrants, which were exercisable
for approximately 6.3 million shares of Sprint PCS common stock, for nominal
consideration. Cox expects to recognize a nominal loss in the second quarter
of 2003 as a result of this sale.

Other

Cox has several other fair value, equity and cost method investments that
were not, individually or in the aggregate, significant in relation to the
Condensed Consolidated Balance Sheets at March 31, 2003 and December 31, 2002.

4.     Intangible Assets

On January 1, 2002, Cox adopted SFAS No. 142, Goodwill and Other
Intangible Assets, which requires that goodwill and certain intangible assets
with indefinite useful lives no longer be amortized, but instead be tested for
impairment at least annually. Cox has determined that its franchise value
intangible assets have an indefinite useful life. Cox assesses franchise value
for impairment under SFAS No. 142 by utilizing a residual approach whereby Cox
measures the implied fair value of each franchise value intangible asset
subject to the same unit of accounting by deducting from the fair value of each
cable system cluster the fair value of the cable system clusters other net
assets, including previously unrecognized intangible assets. In performing its
January 1, 2003 annual impairment test, Cox considered the guidance contained
in Emerging Issues Task Force

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Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

Issue No. 02-17, Recognition of Customer Relationship Intangible Assets
Acquired in a Business Combination, whereby Cox considered assumptions that
marketplace participants would consider, such as expectations of future
contract renewals and other benefits related to the intangible asset, when
measuring the fair value of the cable system clusters other net assets. The
January 1, 2003 impairment test resulted in a non-cash impairment charge of
approximately $25.0 million, which is classified within amortization expense in
Coxs Condensed Consolidated Statement of Operations.

Summarized below are the carrying value and accumulated amortization of
intangible assets that continue to be amortized under SFAS No. 142, as
well as the carrying value of those intangible assets, which are no longer be
amortized:

March 31, 2003
    
    December 31, 2002Gross
    
    
    
    
    
    Net
    
    Gross
    
    
    
    
    
    NetCarrying
    
    Accumulated
    
    Carrying
    
    Carrying
    
    Accumulated
    
    CarryingValue
    
    Amortization
    
    Value
    
    Value
    
    Amortization
    
    Value(Thousands of Dollars)Intangible assets
subject
to amortization
    
    $
    47,703
    
    
    $
    17,092
    
    
    $
    30,611
    
    
    $
    47,095
    
    
    $
    15,788
    
    
    $
    31,307Franchise value
    
    
    
    
    
    
    
    
    
    $
    15,665,265
    
    
    
    
    
    
    
    
    
    
    $
    15,692,981Total intangible assets
    
    
    
    
    
    
    
    
    
    $
    15,695,876
    
    
    
    
    
    
    
    
    
    
    $
    15,724,288


5.     Debt

March 31
    
    December 312003
    
    2002(Thousands of Dollars)Revolving credit
facilities
    
    $
    
    
    
    $
    Commercial paper
    
    
    98,210
    
    
    
    Medium-term notes
    
    
    391,296
    
    
    
    391,274Notes and
debentures
    
    
    5,050,369
    
    
    
    5,352,489Exchangeable subordinated debentures
    
    
    1,308,849
    
    
    
    1,296,070Zero coupon debt
    
    
    46,720
    
    
    
    41,377Capitalized lease
obligations
    
    
    207,735
    
    
    
    219,217Other
    
    
    15,519
    
    
    
    15,5707,118,698
    
    
    
    7,315,997Less current
portion
    
    
    90,356
    
    
    
    393,040Total long-term debt
    
    $
    7,028,342
    
    
    $
    6,922,957


See Note 6. Derivative Instruments and Hedging Activities for a
discussion of the accounting for certain derivative instruments embedded in the
exchangeable subordinated debentures and zero-coupon debt, which have been
classified as a component of debt in the Condensed Consolidated Balance Sheets
at March 31, 2003 and December 31, 2002.

9



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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

Revolving Credit Facilities

Cox has a $1.1 billion 364-day credit agreement available through June 27,
2003 and a $0.9 billion 5-year credit agreement available through September 26,
2005. The 364-day credit agreement has a term-out feature that allows Cox to
extend the maturity of its 364-day credit agreement for an additional two years
at maturity. At Coxs election, the interest rate on these credit agreements
is based on London Interbank Offered Rate (LIBOR), the certificate of deposit
rate plus varying percentages or an alternate base rate. These credit
agreements also impose a commitment fee on the unused portion of the total
amount available based on a ratio of debt to operating cash flow, a measure of
performance not calculated in accordance with accounting principles generally
accepted in the United States of America, and a utilization fee based on the
level of borrowings. Cox had no borrowings outstanding under either credit
agreement at March 31, 2003 and December 31, 2002.

Notes and Debentures

In accordance with the terms of the indenture governing Coxs convertible
senior notes due 2021, Cox became obligated to purchase for cash convertible
notes tendered and not withdrawn before the close of business on February 24,
2003. Cox repurchased $422.7 million aggregate principal amount at maturity of
the convertible notes that had been properly tendered and not withdrawn, for
aggregate cash consideration of $304.2 million, which represented the accreted
value of the repurchased notes. As a result, $19.0 million of the original
$770.8 million aggregate principal amount at maturity of Coxs convertible
notes remain outstanding.

A series of Coxs outstanding debt securities due 2033, representing
$250.0 million aggregate principal amount, is subject to remarketing in July
2003. If the remarketing occurs, the maturity date on these debt securities
will remain August 1, 2033. If the remarketing does not occur, Cox will be
required to redeem such securities, and may pay a premium to the remarketing
dealer. Cox intends to refinance such securities with the issuance of new debt
or use of capacity from existing credit facilities. As a result, these debt
securities are classified as long-term debt on Coxs Condensed Consolidated
Balance Sheet at March 31, 2003.

Exchangeable Subordinated Debentures

Exchangeable subordinated debentures at March 31, 2003 are comprised of:
$1.3 billion aggregate original principal amount of exchangeable subordinated
debentures, referred to as PRIZES, which were issued in November 1999 and are
due November 2029; $275.0 million aggregate original principal amount of
exchangeable subordinated debentures, referred to as Premium PHONES, which were
issued in March 2000 and are due March 2030; and $1.8 billion aggregate
principal amount at maturity of exchangeable subordinated discount debentures,
referred to as Discount Debentures, which were issued in April 2000 and are due
April 2020. The Discount Debentures were issued with an aggregate original
issue discount of $1.1 billion.

The original principal amount of the PRIZES, Premium PHONES and Discount
Debentures are indexed to the trading price of Sprint PCS common stock.
Accordingly, if the fair value of the Sprint PCS common stock rises above the
market price at the time of issuance, Cox may be obligated to pay an additional
amount in excess of the original principal at maturity or upon the holders
exchange of the PRIZES, Premium PHONES and Discount Debentures. As of May 5,
2003, Cox and the trustee under the indenture governing the terms of the
Premium PHONES executed the Sixth Supplemental Indenture pursuant to which
Coxs right to deliver Sprint PCS common stock to a holder upon settlement of
such holders exchange of Premium PHONES was terminated. The Discount
Debentures are exchangeable at the holders option for cash

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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

based on the value
of shares of Sprint PCS common stock, and Cox, may elect, in its sole
discretion, to deliver shares of Sprint PCS common stock to a holder upon a
settlement of such holders exchange. The PRIZES and Premium Phones are
exchangeable at the holders option for cash based on the value of shares of
Sprint PCS common stock. With respect to the Discount Debentures, the holders
may also require Cox to repurchase these securities on certain dates prior to
maturity at a purchase price equal to the adjusted principal amount plus any
accrued and unpaid interest. See Note 6. Derivative Instruments and Hedging
Activities for more information regarding the accounting for the exchangeable
subordinated debentures.

On May 6, 2003, Cox launched tender offers to purchase any and all of its
outstanding PRIZES and any and all of its outstanding Premium PHONES for cash.
Each PRIZES will be purchased at a price of $39.50 for each $88.50 original
principal amount of the PRIZES, and each Premium PHONES will be purchased at a
price of $581.25 for each $1,000 original principal amount of the Premium
PHONES, if validly tendered before 5:00 p.m., New York City time, on May 19,
2003. After May 19, 2003, but before the expiration of the offers at 5:00
p.m., New York City time, on June 4, 2003, unless extended by Cox, each validly
tendered PRIZES will be purchased at a price of $37.50 per PRIZES, and each
validly tendered Premium PHONES will be purchased at a price of $561.25 per
Premium PHONES. In either case, holders of the PRIZES and Premium PHONES that
validly tender their securities will receive accrued and unpaid interest up to
but excluding the settlement date.

Cox cannot predict how many holders will tender their securities pursuant
to the tender offers. Cox may terminate either or both tender offers at any
time in its sole discretion. Coxs obligation to accept for purchase, and pay
for, either PRIZES or Premium PHONES is not, however, conditioned upon the
acceptance for purchase of and payment for the other series or upon a minimum
principal amount of PRIZES or Premium PHONES being tendered.

Interest Rate Swaps

Cox utilizes interest rate swap agreements to manage its exposure to
changes in interest rates associated with certain of its fixed-rate debt
obligations whereby these fixed-rate debt obligations are effectively converted
into floating-rate debt obligations. The variable rates with respect to Coxs
interest rate swaps are adjusted quarterly or semi-annually based on London
Interbank Offered Rates. The notional amounts with respect to the interest
rate swaps do not quantify risk, but are used in the determination of cash
settlements under the interest rate swap agreements. Cox is exposed to a
credit loss in the event of nonperformance by the counterparties; however, Cox
does not anticipate nonperformance by the counterparties. For a further
discussion regarding Coxs accounting for interest rate swaps, see Note 6.
Derivative Instruments and Hedging Activities.

In March 2003, Cox entered into two new interest rate swap agreements
expiring on August 1, 2008 with a notional amount of $100.0 million each to
convert $200.0 million of fixed rate senior debt securities to a floating rate.
The swaps have been designated as fair value hedges of the underlying debt
securities, as defined in SFAS No. 133, Accounting for Derivative Instruments
and Hedging Activities,as amended.

The following table summarizes the notional amounts, weighted average
interest rate data and maturities for Coxs interest rate swap agreements at
March 31, 2003 and December 31, 2002:

March 31
    
    December 312003
    
    2002Notional amount (in
thousands)
    
    $
    1,350,000
    
    
    $
    1,150,000Weighted average fixed interest rate received
    
    
    7.24
    %
    
    
    7.38
    %Weighted average floating interest rate
paid
    
    
    2.77
    %
    
    
    3.10
    %Maturity
    
    
    2004 - 2008
    
    
    
    2004 - 2006


As a result of the settlements under Coxs interest rate swap agreements,
interest expense was reduced by $13.8 million and $12.9 million, respectively,
during the three months ended March 31, 2003 and 2002.

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Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

6.     Derivative Instruments and Hedging Activities

Cox accounts for derivative instruments in accordance with SFAS No. 133,
which requires all freestanding and embedded derivative instruments to be
measured at fair value and recognized on the balance sheet as either assets or
liabilities. In addition, all derivative instruments used in hedging
relationships must be designated, reassessed and accounted for as either fair
value hedges or cash flow hedges pursuant to the provisions of SFAS No. 133.

Cox does not hold or issue derivative instruments for trading purposes and
is not a party to leveraged instruments. From time to time, however, Cox uses
derivative instruments to manage its exposure to changes in the fair value of
certain of its assets or liabilities or to manage its exposure to changes in
interest rates or equity prices. These derivative instruments are designated
and accounted for by Cox as hedges of the underlying exposure being managed, as
prescribed by SFAS No. 133. In addition, upon adoption of SFAS No. 133,
certain of Coxs debt instruments and investments contained embedded or
freestanding derivatives, as defined. Cox has not designated these embedded
and freestanding derivatives as hedges under SFAS No. 133 and, as such, changes
in their fair value are being recognized in earnings as derivative gains or
losses. Coxs use of derivative instruments may result in short-term gains or
losses and may increase volatility in its earnings.

The credit risks associated with Coxs derivative financial instruments
are controlled through the evaluation and monitoring of the creditworthiness of
the counterparties. Although Cox may be exposed to losses in the event of
nonperformance by the counterparties, Cox does not expect such losses, if any,
to be significant.

Cox recorded pre-tax loss on derivative instruments of $2.5 million during
the three months ended March 31, 2003 and a pre-tax gain on derivative
instruments of $719.8 million during the three months ended March 31, 2002. In
addition, cumulative derivative adjustments made in accordance with SFAS No.
133, which are classified as a component of debt in the Condensed Consolidated
Balance Sheets, reduced reported indebtedness by approximately $1.4 billion at
March 31, 2003 and December 31, 2002. The following is a detail of Coxs gain
(loss) on derivative instruments for the three months ended March 31, 2003 and
2002 followed by a summary of Coxs derivative instruments.

Three Months EndedMarch 312003
    
    2002Equity collar arrangements
    
    $
    
    
    
    $
    268,755Zero-coupon debt
    
    
    1,632
    
    
    
    226,301Exchangeable subordinated debentures
    
    
    150
    
    
    
    287,240Stock purchase warrants
    
    
    (4,285
    )
    
    
    (62,533
    )Total derivative gain (loss)
    
    $
    (2,503
    )
    
    $
    719,763


Interest Rate Swap Agreements

Cox utilizes interest rate swap agreements designed to assist Cox in
maintaining a mix of fixed and floating rate debt by converting a portion of
existing fixed rate debt into a floating rate obligation. Cox has designated
and accounted for its interest rate swap agreements as fair value hedges
whereby the fair value of the related interest rate swap agreements are
classified as a component of other assets with the corresponding fixed-rate
debt obligations being classified as a component of debt in the Condensed
Consolidated Balance Sheets. Cox has assumed no ineffectiveness with regard to
these interest rate swap agreements as the agreements qualify for the short-cut
methodof accounting for fair value hedges of debt instruments, as prescribed
by SFAS No. 133. Coxs interest rate swap agreements approximated a derivative
asset of $113.4 million and $112.1 million at March 31, 2003 and December 31,
2002, respectively.

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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

Equity Collar Arrangements

Cox had a series of costless equity collar arrangements to manage its
exposure to market price fluctuations of approximately 15.8 million shares of
its Sprint PCS common stock. Cox also had costless equity collar arrangements
to manage its exposure to market price fluctuations of 17.2 million shares of
its AT&T Wireless common stock and of 22.5 million shares of its AT&T common
stock. Cox had designated and accounted for all of these costless equity
collars as fair value hedges. During the first quarter of 2002, Cox terminated
these equity collar arrangements for aggregate proceeds of $264.4 million and
recognized a pre-tax derivative gain of approximately $268.8 million.

Zero-Coupon Debt

Cox has a series of prepaid forward contracts to sell up to 19.5 million
shares of its Sprint PCS common stock. These contracts mature at various dates
between 2004 and 2006, and at Coxs election, may be settled in cash or shares
of Sprint PCS common stock. These contracts meet the definition of a hybrid
instrument, as prescribed by SFAS No. 133. These hybrid instruments are
comprised of a zero-coupon debt instrument, as the host contract, and an
embedded derivative, which derives its value, in part, based on the trading
price of Sprint PCS common stock. Cox has not designated these embedded
derivatives as a hedge of its investment in Sprint PCS common stock. As a
result, changes in the fair value of these embedded derivatives are recognized
in earnings and classified within gain (loss) on derivative instruments in the
Condensed Consolidated Statements of Operations. The aggregate fair value of
these embedded derivatives approximated a derivative asset of $401.7 million
and $400.1 million at March 31, 2003 and December 31, 2002, respectively, and
have been classified as a component of the zero-coupon debt instruments.
Accordingly, the carrying value of the zero-coupon debt instruments, net of the
embedded derivative assets, amounted to a net liability of $46.7 million and
$41.4 million at March 31, 2003 and December 31, 2002, respectively, and have
been classified within debt in the Condensed Consolidated Balance Sheets.

Exchangeable Subordinated Debentures

Cox has three series of exchangeable subordinated debentures outstanding,
referred to as PRIZES, Premium PHONES and Discount Debentures, as further
described in Note 5. Debt. The exchangeable subordinated debentures meet the
definition of a hybrid instrument, as prescribed by SFAS No. 133. These hybrid
instruments are comprised of an exchangeable subordinated debt instrument, as
the host contract, and an embedded derivative, which derives, in part, its
value based on the trading price of Sprint PCS common stock, U.S. Treasury
rates and Coxs credit spreads. Cox has not designated these embedded
derivatives as a hedge of its investment in Sprint PCS common stock. As a
result, changes in the fair value of these embedded derivatives are recognized
in earnings and classified within gain (loss) on derivative instruments in the
Condensed Consolidated Statements of Operations. The aggregate fair value of
these embedded derivatives approximated a derivative obligation of $0.4 million
and $0.6 million at March 31, 2003 and December 31, 2002, respectively, and
have been classified as a component of the corresponding exchangeable
subordinated debt instruments. Accordingly, the aggregate carrying value of
the exchangeable subordinated debt instruments, including the embedded
derivative obligations, amounted to $1,308.8 million and $1,296.1 million at
March 31, 2003 and December 31, 2002, respectively, and have been classified
within debt in the Condensed Consolidated Balance Sheets.

Stock Purchase Warrants

Cox holds warrants to purchase equity securities of certain
publicly-traded and privately-held entities. Warrants that can be exercised
and settled by the delivery of net shares such that Cox pays no cash upon
exercise are deemed freestanding derivative instruments, as prescribed by SFAS
No. 133. Cox has not designated net share warrants as hedging instruments;
accordingly, changes in the fair value of these

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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

warrants are recognized in
earnings and classified within gain (loss) on derivative instruments in the
Condensed Consolidated Statements of Operations. The aggregate fair value of
these warrants approximated a derivative asset of $1.9 million and $6.1 million
at March 31, 2003 and December 31, 2002, respectively, and has been classified
as a component of investments in the Condensed Consolidated Balance Sheets.

7.     Earnings Per Share

For the three months ended March 31, 2003, 25.2 million Class A common
shares related to employee stock-based compensation plans, convertible senior
notes and convertible preferred stock were not included in the computation of
diluted earnings per share, because such effects would have been antidilutive
for the period.

The following table reconciles the numerator and the denominator of the
basic and diluted per share computations for income from operations for the
three months ended March 31, 2002:

Three MonthsEndedMarch 31, 2002(Thousands of Dollars,excluding per share data)Income
from continuing operations
(A)
    
    $
    135,572
    

Basic weighted-average shares outstanding
(B)
    
    
    600,727Effect of dilutive securities:Employee stock purchase
plan
    
    
    1Convertible preferred
stock
    
    
    7,309Diluted weighted-average shares outstanding (C)
    
    
    608,037Earnings per shareBasic earnings per share
(A/B)
    
    $
    0.23Diluted earnings per share
(A/C)
    
    $
    0.22


For the three months ended March 31, 2002, 44.4 million common shares
related to employee stock-based compensation plans, convertible senior notes
and the effect of Cox-obligated capital and preferred securities of subsidiary
trusts were not included in the computation of diluted earnings per share,
because such effects would have been antidilutive for the period.

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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

8.     Transactions with Affiliated Companies

Cox receives day-to-day cash management services from CEI, with
settlements of outstanding balances between Cox and CEI occurring periodically
at market interest rates. The amounts due to CEI are generally due on demand
and represent the net balance of the intercompany transactions. The amount due
to CEI from Cox was $49.8 million at March 31,2003, and the amount due from CEI
to Cox was approximately $21.1 million at December 31, 2002. The interest rate
was 1.5% and 1.8% at March 31, 2003 and December 31, 2002, respectively.
Included in amounts due from (to) CEI are the following transactions:

(Thousands of Dollars)Intercompany due from CEI, December 31, 2002
    
    $
    21,109Cash transferred to CEI
    
    
    (791
    )Net operating expense reimbursements
    
    
    (70,139
    )Intercompany due to CEI, March 31, 2003
    
    $
    (49,821
    )


9.     Supplemental Financial Information

March 31
    
    December 312003
    
    2002(Thousands of Dollars)Other current assetsInventory
    
    $
    78,213
    
    
    $
    96,967Income tax
receivable
    
    
    168,459
    
    
    
    119,754Prepaid
assets
    
    
    38,896
    
    
    
    41,522Other
    
    
    9,391
    
    
    
    9,098Total other current
assets
    
    $
    294,959
    
    
    $
    267,341Other current liabilitiesDeposits and
advances
    
    $
    87,173
    
    
    $
    80,816Other
    
    
    137,027
    
    
    
    135,419Total other current
liabilities
    
    $
    224,200
    
    
    $
    216,235


Three Months EndedMarch 312003
    
    2002(Thousands of Dollars)Additional cash flow informationCash paid for
interest
    
    $
    93,598
    
    
    $
    119,837Cash paid (received) for income
taxes
    
    
    2,477
    
    
    
    (96,906
    )


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Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

10.     Commitments and Contingencies

In connection with certain of Coxs recent acquisitions and other
transactions, Cox has provided certain indemnities to the respective
counterparties with respect to future claims that may arise from state or
federal taxing authorities. The nature and terms of these indemnities vary by
transaction and generally remain in force through the requisite statutory
review periods. In addition, the events or circumstances that would require
Cox to perform under these indemnities are transaction and circumstance
specific. As of March 31, 2003, Cox believes the likelihood that it will be
required to perform under these indemnities is remote and that the maximum
potential future payments that Cox could be required to make under these
indemnifications are not determinable at this time, as any future payments
would be dependent on the type and extent of the related claims, and all
available defenses, which are not reasonably estimable. Cox has not
historically incurred any material costs related to performance under these
types of indemnities.

Coxs subsidiary Cox Communications Louisiana L.L.C. (Cox Louisiana) is a
defendant in a putative subscriber class action suit in Louisiana state court
filed on November 5, 1997. The suit challenges the propriety of late fees
charged by Cox Louisiana in the greater New Orleans area to customers who fail
to pay for services in a timely manner. The suit seeks injunctive relief and
damages under certain claimed state law causes of action. The action is being
defended vigorously. The outcome of this matter cannot be predicted at this
time. A related suit filed in Texas was voluntarily dismissed on September 19,
2002.

On November 14, 2000, GTE.NET, L.L.C. d/b/a Verizon Internet Solutions and
Verizon Select Services, Inc. filed suit against Cox in the United States
District Court for the Southern District of California. Verizon alleged that
Cox has violated various sections of the Communications Act of 1934 by
allegedly refusing to provide Verizon with broadband telecommunications service
and interconnection, among other things. On November 29, 2000, Verizon
amended its complaint to add CoxCom, Inc., a subsidiary of Cox, as an
additional defendant. On January 8, 2002, Verizon filed a second amended
complaint, dropping its claims for interconnections and damages. Verizon seeks
various forms of relief, including declaratory and injunctive relief. On
January 29, 2002, the Court granted defendants motion to stay the case on
primary jurisdiction grounds. Cox and CoxCom intend to defend this action
vigorously. The outcome cannot be predicted at this time.

On August 23, 2002, plaintiff Redefining Progress, on behalf of itself and
all others similarly situated, sued Fax.com, Inc., Cox Business Services,
L.L.C. and others in United States District Court for the Northern District of
California, alleging that Fax.com has sent numerous unsolicited advertisements
by facsimile in violation of a federal statute. The complaint alleges that Cox
Business Services, which provides telecommunications services to Fax.com, is
also liable for the facsimiles in violation of the Telephone Consumer
Protection Act of 1991 (TCPA), Sections 206 and 207 of the Telecommunications
Act of 1996 and certain state laws. The suit seeks an award of statutory
damages in the amount of $500 for each violation of the TCPA, treble damages,
injunctive relief, the establishment of a constructive trust and other relief.
On October 11, 2002, Cox Business Services moved to dismiss for lack of subject
matter jurisdiction, for failure to state a claim, and based on the primary
jurisdiction of the FCC. On March 3, 2003, the court granted Cox Business
Services motion to dismiss for lack of subject matter jurisdiction. The time
for appeal has expired. A nearly identical federal court suit was filed in the
United States District Court for the Northern District of California on
September 4, 2002 by plaintiff Daniel David, on behalf of himself and all
others similarly situated, against Fax.com, Cox Business Services, and others,
but was not served until December 4, 2002. The David suit was reassigned to
the same judge presiding over the suit filed by Redefining Progress, and it
asserts substantially the same claims and seeks substantially the same relief.
The David suit was stayed pending the outcome of Cox Business Services motion
to dismiss the Redefining Progress suit. Cox Business Services intends to
defend these actions vigorously. Their outcomes cannot be predicted at this
time.

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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

In addition, on September 8, 2002, plaintiff Daniel David, on behalf of
himself and all others similarly situated, filed a nearly identical case
against Fax.com, Cox Business Services and others in the Superior Court of
California, Alameda County. The complaint asserts various causes of action
including violation of the TCPA, trespass to chattels, violation of Section
17-200 of the California Business and Professions Code and unjust enrichment.
The suit seeks damages and injunctive relief similar to that sought in the
related federal suits. This action has been stayed until July 8, 2003 pending
FCC action on its on-going TCPA rule-making. Cox Business Services intends to
defend this action vigorously. The outcome cannot be predicted at this time.

Cox @Home, Inc., a wholly-owned subsidiary of Cox, is a stockholder of At
Home Corporation, also called Excite@Home, formerly a provider of high-speed
Internet access and content services, which filed for bankruptcy protection in
September 2001. On September 24, 2002, a committee of bondholders of
Excite@Home sued Cox, Cox @Home and Comcast Corporation, among others, in the
United States District Court for the District of Delaware. The suit alleges
the realization of short-swing profits under Section 16(b) of the Securities
Exchange Act of 1934 from purported transactions relating to Excite@Home common
stock involving Cox, Comcast and AT&T Corp., and purported breaches of
fiduciary duty. The suit seeks disgorgement of short-swing profits allegedly
received by the Cox and Comcast defendants totaling at least $600.0 million,
damages for breaches of fiduciary duties in an unspecified amount, attorneys
fees, pre-judgment interest and post-judgment interest. On November 12, 2002,
Cox, Cox @Home, and David Woodrow filed a motion to dismiss or transfer the
action for improper venue or, in the alternative, to transfer the action
pursuant to 28 U.S.C. Sec. 1404. Briefing is completed. The Court has not yet
decided the motion. Cox and Cox @Home intend to defend this action vigorously.
The outcome cannot be predicted at this time.

Jerrold Schaffer and Kevin J. Yourman, on May 26, 2000 and May 30, 2000,
respectively, filed class action lawsuits in the Superior Court of the State of
California for the County of San Mateo, on behalf of themselves and all other
stockholders of Excite@Home as of March 28, 2000, seeking (a) to enjoin
consummation of a March 28, 2000 letter agreement among Excite@Homes principal
investors, including Cox, and (b) unspecified compensatory damages. Cox and
David Woodrow, Coxs former Executive Vice President, Business Development,
among others, are named defendants in both lawsuits. Mr. Woodrow formerly
served on the Excite@Home board of directors. The plaintiffs assert that the
defendants breached purported fiduciary duties of care, candor and loyalty to
the plaintiffs by entering into the letter agreement and/or taking certain
actions to facilitate the consummation of the transactions contemplated by the
letter agreement. On February 26, 2001, the Court stayed both actions, which
had been previously consolidated, on grounds of forum non-conveniens. A
related suit styled Linda Ward, et al. v. At Home Corporation (No. 418233) was
filed on September 6, 2001 in the same court. On February 7, 2002, the Court
consolidated the Ward action with the Schaffer/Yourman action, thereby also
staying the Ward action. On June 18, 2002, the court granted plaintiffs motion
to lift the stay and authorized discovery to proceed regarding Coxs pending
motion to dismiss for lack of personal jurisdiction. On September 10, 2002 the
United States Bankruptcy Court for the Northern District of California in the
Excite@Home bankruptcy proceeding held that the claims in the suits were
derivative and, thus, constituted the exclusive property of the Excite@Home
bankruptcy estate. The Bankruptcy Court thereafter ordered the plaintiffs to
dismiss the suits. Plaintiffs have appealed the Bankruptcy Courts decision to
the United States District Court for the Northern District of California. Cox
intends to defend these actions vigorously. The outcome cannot be predicted at
this time.

On April 26, 2002, Frieda and Michael Eksler filed an amended complaint
naming Cox as a defendant in a putative class action lawsuit in the United
States District Court for the Southern District of New York against AT&T Corp.
and certain former officers of Excite@Home, among others. Cox was served on
May 10, 2002. This case has been consolidated with a related case captioned
Semen Leykin v. AT&T Corp., et al., and another related case, and an amended
complaint in that case, naming Cox as a defendant, was filed and served on
November 7, 2002. The putative class includes persons who purchased shares of
Excite@Home common stock between the time period March 28, 2000 and September
28, 2001. The sole count against Cox asserts a claim against Cox as a
controlling person of Excite@Home under Section 20(a) of the Securities
Exchange Act for violations of Section 10(b) of the Securities Exchange Act and
Rule 10b-5 thereunder. The suit seeks from Cox unspecified monetary damages,
statutory compensation

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##### Table of Contents



Cox Communications, Inc.
Notes to Condensed Consolidated Financial Statements  Continued (Unaudited)

and other relief. In addition, a claim against Coxs
former Executive Vice President, David Woodrow, who formerly served
on Excite@Homes board
of directors, is asserted for breach of purported fiduciary duties. The suit
seeks from Woodrow unspecified monetary and punitive damages. On February 11,
2003, Cox and Woodrow filed a dispositive motion to dismiss on various grounds,
including failure to state a claim. Cox intends to defend this action
vigorously. The outcome cannot be predicted at this time.

Cox and its subsidiaries are parties to various other legal proceedings
that are ordinary and incidental to their businesses. Management does not
expect that any of these other currently pending legal proceedings will have a
material adverse impact on Coxs consolidated financial position, results of
operations or cash flows.

18



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##### Table of Contents






Item 2.     Managements Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the
accompanying unaudited condensed consolidated financial statements for the
three month periods ended March 31, 2003 and 2002.

Overview

Cox Communications, Inc., an indirect 63.4% majority-owned subsidiary of
Cox Enterprises, Inc., is a multi-service broadband communications company
serving approximately 6.5 million customers nationwide. Cox is the nations
fourth largest cable television provider and offers an array of broadband
products and services to both residential and commercial customers in its
markets. These services primarily include analog and digital video, high-speed
Internet access and local and long-distance telephone.

Coxs business strategy is to leverage the capacity and capability of its
broadband network to deliver multiple services to consumers and businesses
while creating multiple revenue streams for Cox. Cox believes that aggressive
investment in the technological capabilities of its broadband network, the
long-term advantages of clustering, the competitive value of bundled services
and its commitment to customer and community service will enhance its ability
to continue to grow its cable operations and offer new services to existing and
new customers.

Based on reported subscriber numbers of other providers of multi-channel
video services, Cox is the sixth largest provider of multi-channel video
services in the county. The following providers report higher subscriber
numbers than Cox: Comcast Corporation, Echostar Communications Corporation,
DirecTV (a subsidiary of Hughes Electronics), AOL-Time Warner and Charter
Communications.

Results of Operations

The following table sets forth summarized consolidated financial
information for the three months ended March 31, 2003 and 2002.

Three Months Ended March 312003
    
    2002
    
    $ Change
    
    % Change(Thousands of Dollars)Revenues
    
    $
    1,366,282
    
    
    $
    1,178,042
    
    
    $
    188,240
    
    
    
    16
    %Costs and expenses
    
    
    886,828
    
    
    
    785,977
    
    
    
    100,851
    
    
    
    13
    %Depreciation and
amortization
    
    
    384,320
    
    
    
    325,792
    
    
    
    58,528
    
    
    
    18
    %Operating income
    
    
    95,134
    
    
    
    66,273
    
    
    
    28,861
    
    
    
    44
    %Interest expense
    
    
    (129,824
    )
    
    
    (127,617
    )
    
    
    (2,207
    )
    
    
    2
    %Gain (loss) on derivative
instruments,
net
    
    
    (2,503
    )
    
    
    719,763
    
    
    
    (722,266
    )
    
    
    (100
    )%Loss on investments,
net
    
    
    (1,751
    )
    
    
    (408,730
    )
    
    
    406,979
    
    
    
    (100
    )%Equity in net losses of affiliatedcompanies
    
    
    (2,164
    )
    
    
    (2,813
    )
    
    
    649
    
    
    
    (23
    )%Other, net
    
    
    (341
    )
    
    
    735
    
    
    
    (1,076
    )
    
    
    (146
    )%Income tax (expense) benefit
    
    
    14,498
    
    
    
    (99,970
    )
    
    
    114,468
    
    
    
    (115
    )%Minority interest, net of tax
    
    
    (2,270
    )
    
    
    (12,069
    )
    
    
    9,799
    
    
    
    (81
    )%Net income
(loss)
    
    $
    (29,221
    )
    
    $
    135,572
    
    
    $
    (164,793
    )
    
    
    (122
    )%


19



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##### Table of Contents



Revenues

The following table sets forth summarized revenue information for the
three months ended March 31, 2003 and 2002.

Three Months Ended March 312003
    
    % of Total
    
    2002
    
    % of Total
    
    $ Change
    
    % Change(Thousands of Dollars)ResidentialVideo
    
    $
    898,942
    
    
    
    66
    %
    
    $
    833,859
    
    
    
    71
    %
    
    $
    65,083
    
    
    
    8
    %Data
    
    
    194,218
    
    
    
    14
    %
    
    
    121,565
    
    
    
    10
    %
    
    
    72,653
    
    
    
    60
    %Telephony
    
    
    107,093
    
    
    
    8
    %
    
    
    72,752
    
    
    
    6
    %
    
    
    34,341
    
    
    
    47
    %Other
    
    
    22,152
    
    
    
    2
    %
    
    
    20,545
    
    
    
    2
    %
    
    
    1,607
    
    
    
    8
    %Total residential
    
    
    1,222,405
    
    
    
    90
    %
    
    
    1,048,721
    
    
    
    89
    %
    
    
    173,684
    
    
    
    17
    %Commercial
    
    
    63,369
    
    
    
    4
    %
    
    
    49,795
    
    
    
    4
    %
    
    
    13,574
    
    
    
    27
    %Advertising
    
    
    80,508
    
    
    
    6
    %
    
    
    79,526
    
    
    
    7
    %
    
    
    982
    
    
    
    1
    %Total revenues
    
    $
    1,366,282
    
    
    
    100
    %
    
    $
    1,178,042
    
    
    
    100
    %
    
    $
    188,240
    
    
    
    16
    %


The 16% increase in total revenues is primarily attributable to:



| |  | a 38% increase in customers for advanced services, including digital
cable, high-speed Internet access and telephony customers;
|- |  | -------------------------------------------------------------------------------------------------------------------------------



| |  | a 7% increase in basic cable rates resulting from increased
programming costs and inflation, as well as increased channel
availability;
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------



| |  | a $5 per month price increase on high-speed Internet access adopted in
certain markets in the fourth quarter of 2002 and in most of Coxs
remaining markets in the first quarter of 2003; and
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | an increase in commercial broadband customers.
|- |  | ----------------------------------------------

Cox has experienced solid growth in digital cable, residential data and
telephony customers. Cox expects this trend to continue and anticipates
continued consumer demand for its existing portfolio of broadband products, as
well as for new services such as Entertainment On Demand, Home Networking and
high-definition television. However, actual growth and demand may not meet
Coxs expectations due to increased competition, reduced demand and other risks
and uncertainties.

Costs and expenses

The
following table sets forth summarized operating expenses for the
three months ended March 31, 2003 and 2002.

Three Months EndedMarch 312003
    
    2002
    
    $ Change
    
    % Change(Thousands of Dollars)Cost of servicesProgramming costs
    
    $
    294,645
    
    
    $
    258,761
    
    
    $
    35,884
    
    
    
    14
    %Other cost of
services
    
    
    288,971
    
    
    
    248,623
    
    
    
    40,348
    
    
    
    16
    %Total cost of
services
    
    
    583,616
    
    
    
    507,384
    
    
    
    76,232
    
    
    
    15
    %Selling, general and administrativeMarketing
    
    
    62,436
    
    
    
    65,555
    
    
    
    (3,119
    )
    
    
    (5
    )%General and administrative
    
    
    240,776
    
    
    
    213,038
    
    
    
    27,738
    
    
    
    13
    %Total selling, general and
administrative
    
    
    303,212
    
    
    
    278,593
    
    
    
    24,619
    
    
    
    9
    %Total costs and expenses
    
    $
    886,828
    
    
    $
    785,977
    
    
    $
    100,851
    
    
    
    13
    %


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##### Table of Contents



Cost of services includes cable programming costs, other direct costs and
field service costs. Other direct costs include costs that Cox incurs in
conjunction with providing its residential, commercial and advertising
services. Field service costs include costs associated with providing and
maintaining Coxs broadband network and customer care costs necessary to
maintain its customer base.

Cost of services increased 15% over 2002 primarily due to a 14% increase
in programming costs reflecting programming rate increases and customer growth.
Approximately 12% of the increase in programming costs was attributable to
programming rate increases, and 2% was related to digital customer growth.
Other cost of services increased 16%, primarily due to:



| |  |  | 1.2 million in net additions of basic and advanced-service
customers over the last twelve months;
| | - |  | -------------------------------------------------------------------------------------------------



| |  |  | increased labor costs due to the transition from upgrade
construction and new product launches to maintenance and related
customer costs directly associated with the growth of new subscribers;
partially offset by
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a one-time non-recurring charge of approximately $9.8 million taken
in the first quarter of 2002 associated with the continuation of
Excite@Home high-speed Internet service following the bankruptcy of
Excite@Home.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Selling, general and administrative expenses include marketing, salaries
and benefits, maintenance and support, commissions and bonuses, travel,
facilities, insurance and other administrative expenses. Selling, general and
administrative expenses increased 9% primarily due to:



| |  |  | a 13% increase in general and administrative expenses primarily
relating to increased salaries and benefits and increased headcount;
partially offset by
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a 5% decrease in marketing expense primarily due to differences in
the timing of certain advertising and marketing promotions between 2002
and 2003.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------

Cox expects continued increases in programming costs and will continue to
pass through some portion of these increases to its customers. In addition, Cox
expects to have continued growth in advanced services, which include digital
cable, high-speed Internet access and telephony, both as a result of increased
penetration where these services were available in 2002 and continued roll-out
of these services in new areas. As a result of these trends, Cox expects its
cost of services and, to a lesser degree, selling, general and administrative
expenses to increase.

Depreciation and amortization

Depreciation and amortization increased to $384.3 million from $325.8
million in the first quarter of 2002 due to a non-cash impairment charge of
$25.0 million, as further described below, and an increase in depreciation from
Coxs continuing investments in its broadband network in order to deliver
additional programming and services. Cox will continue to invest in its
broadband network and new services, which management expects will result in
increased revenues to offset increased depreciation expense.

In performing its January 1, 2003 annual impairment test, Cox considered
the guidance contained in EITF Issue No. 02-17, Recognition of Customer
Relationship Intangible Assets Acquired in a Business Combination, whereby Cox
considered assumptions that marketplace participants would consider, such as
expectations of future contract renewals and other benefits related to the
intangible asset, when measuring the fair value of the cable system clusters
other net assets. The January 1, 2003 impairment test resulted in a non-cash
impairment charge of approximately $25.0 million, which is classified within
amortization expense in Coxs Condensed Consolidated Statement of Operations.

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Operating income

Operating income for the first quarter of 2003 was $95.1 million compared
to $66.3 million for the first quarter of 2002. Operating income for the first
quarter of 2002 includes a one-time non-recurring net charge of approximately
$9.8 million associated with the continuation of Excite@Home high-speed
Internet service following the bankruptcy of Excite@Home. The increase in
operating income, after adjusting for the one-time charge, was primarily
attributable to a 16% increase in revenues.

Interest expense

Interest expense increased 2% to $129.8 million primarily due to the
issuance of $1.0 billion aggregate principal amount of 7.125% senior notes in
September 2002. This increase was offset by a decrease in the interest rate on
Coxs exchangeable subordinated debentures, known as the PRIZES, from 7.75% to
2% in November 2002 in accordance with the terms of the PRIZES and increased
interest savings as a result of Coxs interest rate swap agreements.

Gain (loss) on derivative instruments, net

During the first quarter of 2003, Cox recorded a $2.5 million pre-tax loss
on derivative instruments, which was comprised of the following:



| |  |  | a $4.3 million pre-tax loss due to a decrease in the fair value of
Coxs stock purchase warrants. The decrease in fair value of these
warrants was primarily attributed to the decrease in the fair value of
the underlying equity security during the quarter; partially offset by
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a $1.6 million pre-tax gain due to a decrease in the fair value of
the embedded derivatives contained in Coxs zero-coupon debt. The
decrease in fair value of these embedded derivatives was primarily
attributed to the decrease in the trading price of Sprint PCS and the
change in U.S. Treasury rates and Coxs credit spreads during the
quarter.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The $719.8 million pre-tax gain on derivative instruments for the first
quarter of 2002 was comprised of a $287.2 million pre-tax gain due to a
decrease in the fair value of the embedded derivatives in Coxs exchangeable
subordinated debentures, a $226.3 million pre-tax gain due to a decrease in the
fair value of the embedded derivatives contained in Coxs zero-coupon debt; and
a $206.3 million pre-tax gain due to a decrease in the fair value of certain
derivative instruments associated with Coxs investments, including Sprint PCS,
AT&T and AT&T Wireless.

Loss on investments, net

Net loss on investments of $1.8 million for the first quarter of 2003 is
primarily due to a decline in the fair value of certain investments considered
to be other than temporary and a pre-tax loss as a result of the change in
market value of Coxs investment in Sprint PCS common stock classified as
trading. The net loss on investments for the comparable period in 2002 was
primarily due to a pre-tax loss related to the sale of 23.9 million shares of
AT&T Wireless common stock and a pre-tax loss as a result of the change in
market value of Coxs investment in Sprint PCS common stock classified as
trading.

Equity in net losses of affiliated companies

Equity in net losses decreased 23% to $2.2 million. Generally, these
losses are attributable to Coxs proportionate share of the investees income
or loss. Although Cox has various levels of ownership and rights with respect
to the companies in which it has equity investments, Cox has little, if any,
control over the financial position of these companies. Therefore, Cox cannot
predict the impact that its equity investments will have on its future
operations.

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Minority interest, net of tax

Minority interest, net of tax, decreased 81% to $2.3 million for the first
quarter of 2003. This was primarily due to the settlement of Coxs obligated
capital and preferred securities of subsidiary trusts, referred to as FELINE
PRIDES and RHINOS, in 2002. The distributions on these securities represented
minority interest.

Net income (loss)

Net loss for the first quarter of 2003 was $29.2 million compared to net
income of $135.6 million for the comparable period in 2002.

Liquidity and Capital Resources

Uses of Cash

As part of Coxs ongoing strategic plan, Cox has invested, and will
continue to invest, capital to enhance the reliability and capacity of its
broadband network in preparation for the offering of new services and to make
investments in companies primarily focused on cable programming,
telecommunications and technology. Cox believes it will be able to meet its
capital needs for the next twelve months and beyond with amounts available
under existing revolving credit facilities and its commercial paper program.

During the three months ended March 31, 2003, Cox made capital
expenditures of $325.7 million. These expenditures were primarily directed at
costs related to electronic equipment located on customers premises, costs to
upgrade and rebuild Coxs broadband network to allow for the delivery of
advanced broadband services and costs associated with network equipment used to
enter new service areas.

Capital expenditures for the year ending 2003 are expected to be
approximately $1.6 billion. Cox expects depreciation expense to increase due
to its continued investment in its broadband network. However, management
expects increased revenues to offset increased depreciation expense. Cox does
not expect to make any material acquisitions or cable systems exchanges in
2003, although management continuously reviews industry and economic conditions
to identify opportunities.

During the three months ended March 31, 2003, Cox repaid $315.7 million of
debt, which primarily consisted of the repurchase of a portion of its
convertible senior notes.

Sources of Cash

During the three months ended March 31, 2003, Cox generated $355.9 billion
from operating activities. Net commercial paper borrowings during the first
three months of 2003 were $98.2 million.

Other

At March 31, 2003, Cox had approximately $7.1 billion of outstanding
indebtedness (net of cumulative derivative adjustments made in accordance with
SFAS No. 133 which reduced reported indebtedness by approximately $1.4
billion). In addition, Cox had approximately $2.0 billion of total available
financing capacity under its revolving credit facilities and commercial paper
program at March 31, 2003.

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##### Table of Contents



Recent Developments

In April 2003, Cox sold its Sprint PCS warrants, which were exercisable
for approximately 6.3 million shares of Sprint PCS common stock, for nominal
consideration. Cox expects to recognize a nominal loss in the second quarter
of 2003 as a result of this sale.

On May 6, 2003, Cox launched tender offers to purchase any and all of its
outstanding PRIZES and any and all of its outstanding Premium PHONES for cash.
The tender offers are being made in connection with Coxs continuing efforts to
reduce its long-term obligations and simplify its balance sheet. Each PRIZES
will be purchased at a price of $39.50 for each $88.50 original principal
amount of the PRIZES, and each Premium PHONES will be purchased at a price of
$581.25 for each $1,000 original principal amount of the Premium PHONES, if
validly tendered before 5:00 p.m., New York City time, on May 19, 2003. After
May 19, 2003, but before the expiration of the offers at 5:00 p.m., New York
City time, on June 4, 2003, unless extended by Cox, each validly tendered
PRIZES will be purchased at a price of $37.50 per PRIZES, and each validly
tendered Premium PHONES will be purchased at a price of $561.25 per Premium
PHONES. In either case, holders of the PRIZES and Premium PHONES that validly
tender their securities will receive accrued and unpaid interest up to but
excluding the settlement date. Nothing in this report should be construed as
an offer to purchase any outstanding PRIZES or Premium PHONES, as such offers
are only being made upon the terms and are subject to the conditions set forth
in an Offer to Purchase dated May 6, 2003.

Cox cannot predict how many holders will tender their securities pursuant
to the tender offers. Cox may terminate either or both tender offers at any
time in its sole discretion. Coxs obligation to accept for purchase, and pay
for, either PRIZES or Premium PHONES is not, however, conditioned upon the
acceptance for purchase of and payment for the other series or upon a minimum
principal amount of PRIZES or Premium PHONES being tendered.

Cox will recognize cancellation of indebtedness income for United States
federal income tax purposes to the extent that the cash paid is less than its
adjusted issue price (as defined for United States federal income tax purposes)
of the PRIZES and the Premium PHONES that are sold to Cox pursuant to the
tender offers. Although Cox cannot provide any assurances in this regard, Cox
currently expects that a substantial portion of any cancellation of
indebtedness income will be offset by operating losses incurred during the
current tax year. If these deductions are not available in the amount that Cox
expects, however, Cox may incur substantial U.S. federal income tax
liabilities. Cox may also be subject to state and local tax liability in
connection with the purchase of the PRIZES and the Premium PHONES by Cox.

Recently Issued Accounting Pronouncements

In January 2003, the Financial Accounting Standards Board (FASB) issued
FASB Interpretation No. 46, Consolidation of Variable Interest Entities.
Interpretation No. 46 addresses consolidation by business enterprises of
variable interest entities, which are entities that either (a) do not have
equity investors with vesting rights or (b) have equity investors that do not
provide sufficient financial resources for the entity to support its
activities. The interpretation is effective for the first interim or annual
reporting period beginning after June 15, 2003 for existing variable interest
entities and is effective immediately for variable interest entities created
after January 31, 2003. Cox does not currently hold any interest in variable
interest entities.

Caution Concerning Forward-Looking Statements

This Form 10-Q includes forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements include, among others, 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

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##### Table of Contents



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, Coxs ability to achieve
anticipated subscriber and revenue growth, Coxs success in implementing new
services and other operating initiatives, and Coxs ability to generate
sufficient cash flow to meet debt service obligations and finance operations.
For a more detailed discussion of these and other risk factors, see the
Caution Concerning Forward-Looking Statements section of Coxs Annual Report
on Form 10-K for the year ended December 31, 2002. Cox assumes no
responsibility to update any forward-looking statements as a result of new
information, future events or otherwise.




Item 3.     Quantitative and Qualitative Disclosures About Market Risk

Cox has estimated the fair value of its financial instruments as of March
31, 2003 and December 31, 2002 using available market information or other
appropriate valuation methodologies. Considerable judgment, however, is
required in interpreting market data to develop the estimates of fair value.
Accordingly, the estimates presented herein are not necessarily indicative of
the amounts that Cox would realize in a current market exchange.

The carrying amount of cash, accounts and other receivables, accounts and
other payables and amounts due to/from CEI approximates fair value because of
the short maturity of those instruments. The fair value of Coxs investments
stated at fair value are estimated and recorded based on quoted market prices.
The fair value of Coxs equity method investments and investments stated at
cost cannot be estimated without incurring excessive costs. Cox is exposed to
market price risk volatility with respect to investments in publicly-traded and
privately-held entities. Additional information pertinent to the value of
Coxs investments is discussed in Note 3. Investments in Part I, Item 1.
Condensed Consolidated Financial Statements.

The fair value of interest rate swaps used for hedging purposes was
approximately $113.4 million and $112.1 million at March 31, 2003 and December
31, 2002, respectively, and represents the estimated amount that Cox would
receive upon termination of the swap agreements.

Coxs outstanding commercial paper bears interest at current market rates
and, thus, approximates fair value at March 31, 2003. Cox is exposed to
interest rate volatility with respect to these variable-rate instruments. Cox
did not have any variable rate instruments outstanding at December 31, 2002.

The estimated fair value of Coxs fixed-rate notes and debentures and
exchangeable subordinated debentures at March 31, 2003 and December 31, 2002
are based on quoted market prices or a discounted cash flow analysis using
Coxs incremental borrowing rate for similar types of borrowing arrangements
and dealer quotations. A summary of the carrying value, estimated fair value
and the effect of a hypothetical one percentage point decrease in interest
rates on the foregoing fixed-rate instruments at March 31, 2003 and December
31, 2002 is as follows:

March 31, 2003
    
    December 31, 2002Fair Value
    
    
    
    
    
    
    
    
    
    Fair ValueCarrying
    
    Fair
    
    (1% Decrease
    
    Carrying
    
    Fair
    
    (1% DecreaseValue
    
    Value
    
    in Interest Rates)
    
    Value
    
    Value
    
    in Interest Rates)(Millions of Dollars)Fixed-rate notes and
debentures
    
    $
    5,665.4
    
    
    $
    6,215.8
    
    
    $
    6,160.7
    
    
    $
    5,978.6
    
    
    $
    6,386.5
    
    
    $
    6,432.8Exchangeable subordinated
debentures
    
    
    1,308.8
    
    
    
    1,451.8
    
    
    
    1,680.5
    
    
    
    1,296.1
    
    
    
    1,409.1
    
    
    
    1,637.6


25



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##### Table of Contents






Item 4.     Disclosure Controls and Procedures

The Chief Executive Officer and the Chief Financial Officer of Cox (its
principal executive officer and principal financial officer, respectively) have
concluded, based on their evaluation as of a date within 90 days prior to the
date of the filing of this Form 10-Q, that Coxs disclosure controls and
procedures: are effective to ensure that information required to be disclosed
by Cox in the reports filed or submitted by it under the Securities Exchange
Act of 1934, as amended, is recorded, processed, summarized and reported within
the time periods specified in the SECs rules and forms; and include controls
and procedures designed to ensure that information required to be disclosed by
Cox in such reports is accumulated and communicated to Coxs management,
including the Chief Executive Officer and the Chief Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure.

There were no significant changes in Coxs internal controls or in other
factors that could significantly affect these controls subsequent to the date
of such evaluation.

Coxs disclosure controls and procedures are designed to provide a
reasonable level of assurance of reaching Coxs desired disclosure control
objectives and are effective in reaching that level of reasonable assurance.




Part II  Other Information




Item 1.     Legal Proceedings

For a description of certain legal matters, refer to Note 10. Commitments
and Contingencies in Part I, Item 1. Condensed Consolidated Financial
Statements.

Cox is also a party to various legal proceedings that are ordinary and
incidental to its business. Management does not expect that any legal
proceedings currently pending will have a material adverse impact on Coxs
consolidated financial position, consolidated results of operations or
consolidated cash flows.




Item 2.     Changes in Securities and Use of Proceeds

In accordance with the terms of the indenture governing Coxs convertible
senior notes due 2021, Cox became obligated to purchase for cash convertible
notes tendered and not withdrawn before the close of business on February 24,
2003. Cox repurchased $422.7 million aggregate principal amount at maturity of
the convertible notes that had been properly tendered and not withdrawn, for
aggregate cash consideration of $304.2 million, which represented the accreted
value of the repurchased notes. As a result, $19.0 million of the original
$770.8 million aggregate principal amount at maturity of Coxs convertible
notes remain outstanding.

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##### Table of Contents






Item 6.     Exhibits and Reports on Form 8-K

(a)       Exhibits:

3.1
    
    
    
    Amended Certificate of Incorporation of Cox Communications, Inc. (Incorporated
by reference to Exhibit 3.1 to Coxs Quarterly Report on Form 10-Q, filed with
the Commission on November 14, 2000.)3.2
    
    
    
    Bylaws of Cox Communications, Inc. (Incorporated by reference to Exhibit 3.2
to Coxs Registration Statement on Form S-4, File No. 33-80152, filed with the
Commission on December 16, 1994.)21
    
    
    
    Subsidiaries of Cox Communications, Inc. (Incorporated by reference to Exhibit
21 to Coxs Annual Report on Form 10-K, as amended, filed with the Commission
on April 18, 2003.)99.1
    
    
    
    Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.99.2
    
    
    
    Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


(b)       Reports on Form 8-K filed during the quarter ended March 31, 2003:

None.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Cox Communications, Inc.Date: May 9, 2003
    
    /s/ Jimmy W. HayesJimmy W. HayesExecutive Vice President, Financeand Chief Financial Officer(principal financial officer andduly authorized officer)


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CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934

I, James O. Robbins, President and Chief Executive Officer of Cox
Communications, Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Cox Communications,
Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

c) presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrants ability to record, process,
summarize and report financial data and have identified for the registrants
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and

6. The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: May 7, 2003/s/ James O. RobbinsJames O. RobbinsPresident and Chief Executive Officer


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CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934

I, Jimmy W. Hayes, Executive Vice President, Finance and Chief Financial
Officer of Cox Communications, Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Cox Communications,
Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

c) presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrants ability to record, process,
summarize and report financial data and have identified for the registrants
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls;
and

6. The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: May 7, 2003/s/ Jimmy W. Hayes

Jimmy W. HayesExecutive Vice President, Finance and Chief Financial Officer


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