<PAGE>

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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-K/A
                                AMENDMENT NO. 2
(Mark One)

      [X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934
            FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001
                                       OR
      [ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934
       FOR THE TRANSITION PERIOD FROM           TO
                          COMMISSION FILE NO. 0-30673
                             ---------------------

                                NTL INCORPORATED
             (Exact name of registrant as specified in its charter)

<Table>
<S>                                                 <C>
                     DELAWARE                                           13-4105887
         (State or other jurisdiction of                             (I.R.S. Employer
          incorporation or organization)                           Identification No.)

              110 EAST 59TH STREET,
                NEW YORK, NEW YORK                                        10022
     (Address of principal executive offices)                           (Zip Code)
</Table>

                                 (212) 906-8440
              (Registrant's telephone number, including area code)

          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
                     COMMON STOCK, PAR VALUE $.01 PER SHARE
                                (Title of class)

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                      NONE

     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 [ ]

     Indicate by check mark whether disclosure by delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K/A or any
amendment to this Form 10-K/A.  No [X]

     The aggregate market value of the Registrant's voting stock held by
non-affiliates at March 26, 2002, the last day before suspension of trading on
the NYSE of the Registrant's Common Stock, valued in all cases in accordance
with the New York Stock Exchange closing sale price for the Registrant's Common
Stock on such date, was approximately $44,114,400.

     Number of shares of Common Stock outstanding as at March 26, 2002:
276,626,476

                      DOCUMENTS INCORPORATED BY REFERENCE

<Table>
<Caption>
                                            PART OF 10-K/A IN
             DOCUMENT                       WHICH INCORPORATED
             --------                       ------------------
<S>                                 <C>
 Form 10-K/A, Filed on April 30,     Items 10, 11 and 12 of Part III
               2002
</Table>

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--------------------------------------------------------------------------------
<PAGE>

     This Annual Report on Form 10-K/A, Amendment No. 2, for the year ended
December 31, 2001, at the time of filing with the Securities and Exchange
Commission, modifies and supersedes NTL Incorporated's Report on Form 10-K,
filed on April 16, 2002 and Report on Form 10-K/A, filed on April 30, 2002. This
Report on Form 10-K/A, Amendment No. 2 presents disclosure of the Company as of
April 16, 2002, the date of the original filing of its Form 10-K for the year
ended December 31, 2001.

     "Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995:

          Certain statements contained herein constitute "forward-looking
     statements" as that term is defined under the Private Securities Litigation
     Reform Act of 1995. When used in this Form 10-K/A, the words, "believe,"
     "anticipate," "should," "intend," "plan," "will," "expects," "estimates,"
     "projects," "positioned," "strategy," and similar expressions identify such
     forward-looking statements. Such forward-looking statements involve known
     and unknown risks, uncertainties and other factors that may cause the
     actual results, performance or achievements of the Registrant, or industry
     results, to be materially different from those contemplated or projected,
     forecasted, estimated or budgeted, whether expressed or implied, by such
     forward-looking statements. Such factors include, among others, those set
     forth under the caption "Risk Factors" in this Form 10-K/A as well as: the
     ability of the Company to continue as a going concern; the ability of the
     Company to obtain trade credit and shipments and terms with vendors and
     service providers for current orders; the Company's ability to maintain
     contracts that are critical to its operations; potential adverse
     developments with respect to the Company's liquidity or results of
     operations; the ability to fund and execute its business plan; the ability
     to attract, retain and compensate key executives and associates; the
     ability of the Company to attract and retain customers; general economic
     and business conditions; technological developments; the Company's ability
     to continue to design networks; install facilities; obtain and maintain any
     required governmental licenses or approvals; and finance construction and
     development, all in a timely manner at reasonable costs and on satisfactory
     terms and conditions, as well as assumptions about customer acceptance,
     churn rates, overall market penetration and competition from providers of
     alternative services, the impact of restructuring and integration actions,
     the impact of new business opportunities requiring significant up-front
     investment and interest rate and currency exchange rate fluctuations.

     In this Annual Report on Form 10-K/A, "NTL," the "Company," "we," "us," and
"our" refer to NTL Incorporated and its consolidated subsidiaries except where
we expressly state that we are only referring to NTL Incorporated or the context
otherwise requires that we are referring only to NTL Incorporated.

     In this Report on Form 10-K/A, references to "L," "(pound sterling),"
"pounds sterling," "(pound)," "pence" or "p" are to the lawful currency of the
UK, references to "(euro)" or "Euro" are to the lawful currency of the European
Monetary Union, references to "IR(pounds)" or "Irish punts" are to the
historically lawful currency of the Republic of Ireland, references to "FRF" or
"Francs" are to the lawful currency of France, references to "A$" are to the
lawful currency of Australia, references to "CHF" are to the lawful currency of
Switzerland and references to "U.S. dollars," "dollars," "$" or "(cent)" are to
the lawful currency of the United States. Solely for the convenience of the
reader, this Form 10-K/A contains translations of some foreign currency amounts
into U.S. dollars and some U.S. dollar amounts into foreign currencies. You
should not construe these transactions as representations that the foreign
currency amounts actually represent such U.S. dollar amounts or vice versa or
could have been or could be or will be converted into U.S. dollars or foreign
currencies, as the case may be, at the rate indicated or at any other rate.
Unless otherwise indicated, the translations of foreign currencies into U.S.
dollars and U.S. dollars into foreign currencies have been made at $1.4543 per
UK (pound) 1.00, $.8901 per (euro) 1.00, $1.1337 per IR (punt) 1.00, $.1357 per
FRF 1.00, $.5117 per A$1.00 and $.5828 per CHF 1.00, the noon buying rates in
the City of New York for cable transfers as certified for customs purposes by
the Federal Reserve Bank of New York on December 31, 2001. On March 31, 2002,
the Noon Buying Rate was $1.4250 per (pound) 1.00, $.8717 per (euro) 1.00,
$1.2539 per IR (punt) 1.00, $.1329 per FRF 1.00, $.5333 per A$1.00 and $.5945
per CHF 1.00.

                                        1
<PAGE>

                               TABLE OF CONTENTS

<Table>
<Caption>
                                                                        PAGE
                                                                        ----
<S>       <C>                                                           <C>
                                PART I
NTL Corporate Structure...............................................    3
Item 1.   Business....................................................    4
Item 2.   Properties..................................................   28
Item 3.   Legal Proceedings...........................................   28
Item 4.   Submission of Matters to a Vote of Security Holders.........   29
                                  PART II
Item 5.   Market for the Registrant's Common Equity and Related
          Stockholder Matters.........................................   29
Item 6.   Selected Financial Data.....................................   31
Item 7.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations...................................   33
Item 7A.  Quantitative and Qualitative Disclosures About Market
          Risk........................................................   55
Risk Factors..........................................................   57
Item 8.   Financial Statements and Supplementary Data.................   63
Item 9.   Changes in and Disagreements with Accountants on Accounting
          and Financial Disclosure....................................   64
                                  PART III
Items 10, 11, 12, and 13..............................................   64
                                  PART IV
Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form
          8-K.........................................................   66
Exhibit Index.........................................................   67
Signatures............................................................   75
Index to Consolidated Financial Statements............................  F-1
</Table>

                                        2
<PAGE>

                                     PART I

                            NTL CORPORATE STRUCTURE

     NTL Incorporated, a Delaware corporation, was incorporated in December
1999, to effect a reorganization into a holding company structure under Section
251(g) of the Delaware General Corporation Law. The holding company structure,
which was implemented in May 2000 in connection with the acquisition of the
residential assets of Cable & Wireless Communications plc, was accomplished
through a merger. The stockholders of NTL (Delaware), Inc. (formerly NTL
Incorporated), at the effective time of the merger became stockholders of the
new holding company, and NTL (Delaware), Inc. became a subsidiary of the new
holding company. The new holding company then took the name NTL Incorporated.
NTL's principal executive office is located at 110 East 59th Street, New York,
New York 10022, and its telephone number is (212) 906-8440.

     On February 21, 2001, NTL Incorporated contributed the residential
broadband and business cable operations of Cable & Wireless Communications to
NTL Communications Corp., a wholly-owned subsidiary. On February 21, 2001, NTL
(Delaware), Inc. contributed the assets of NTL Business (formerly Workplace
Technologies plc) to NTL Communications Corp. The following chart shows on a
condensed basis the corporate structure of NTL through which our operations are
conducted and investments held, accounting for both contributions. The chart
does not show our operating or other intermediate companies or ownership
interests in those entities. Please note that the following chart does not
reflect the sale of NTL Australia that was completed on April 2, 2002.

                           NTL INCORPORATED FLOWCHART
                                        3
<PAGE>

ITEM 1.  BUSINESS

                              RECENT DEVELOPMENTS

RECAPITALIZATION PROCESS

     On January 31, 2002, we announced that we had appointed Credit Suisse First
Boston, JP Morgan and Morgan Stanley to advise on strategic and recapitalization
alternatives to strengthen our balance sheet, reduce debt and put an appropriate
capital structure in place for our business. Since then, we have been evaluating
various recapitalization alternatives to effect a comprehensive consensual
recapitalization in a timely manner and to minimize negative effects on our
business operations. NTL has been engaged in discussions with an unofficial
committee of bondholders, the members of which hold a majority in principal
amount of the public debt of NTL and its subsidiaries, and France Telecom, which
owns a significant amount of NTL's common and preferred stock. On April 16, we
announced that we had reached an agreement in principle with the unofficial
committee on a comprehensive recapitalization of NTL and its subsidiaries. See
Item 7 "Management's Discussion and Analysis of Financial Condition and Results
of Operations -- Liquidity and Capital Resources" and "Risk Factors" for a more
detailed description of the proposed recapitalization plan and the associated
uncertainties.

     The following business description does not address the possible risks or
negative impacts that could result from the recapitalization process and our
liquidity position. Accordingly, this section must be read in conjunction with
Item 7 "Management's Discussion and Analysis of Financial Condition and Results
of Operations" and the Risk Factors set forth in that section, and the Financial
Statements and related notes.

SALE OF NTL AUSTRALIA

     On April 2, 2002, we announced that we had completed the previously
announced sale of our Australian broadcast business to Macquarie Bank for A$850
million (US$448 million) in an all cash transaction. NTL Australia owned and
operated the most extensive terrestrial broadcast transmission network in
Australia with over 98% population coverage provided from 578 sites located
across metropolitan, regional and rural areas. For the year ended December 31,
2001, NTL Australia's revenues were approximately A$119 million (US$62 million)
generating EBITDA of approximately A$52 million (US$27 million). NTL's
Australian operations also included a 51% share in a joint venture, NTLT, with
two Australian regional broadcasters (WIN Television and Southern Cross
Broadcasting) operating a carrier grade wholesale microwave telecommunications
network along the east coast of Australia.

                                   ABOUT NTL

     NTL is the leading broadband communications and broadband services company
in the UK and the Republic of Ireland based on aggregate subscriber numbers as
of December 31, 2001. We also provide telecommunications services in Switzerland
and Australia and have made strategic investments in broadband operations in
France, Germany and Sweden. Unless otherwise indicated, the following business
description is as of December 31, 2001 and includes a description of NTL's
businesses in Australia which were subsequently sold.

     We offer services to residential, business and wholesale customers on a
national and international scale.

     Our predominant lines of business are:

     - CONSUMER SERVICES, including residential telephony, cable television,
       Internet access and interactive services;

     - BUSINESS SERVICES, including business telephony, national and
       international carrier telecommunications, Internet services and radio
       communications services; and

     - BROADCAST TRANSMISSION AND TOWER SERVICES, including digital and analog
       television and radio broadcasting, wireless network management, tower and
       site leasing and satellite distribution services.

                                        4
<PAGE>

     In 2001, Consumer Services accounted for 68.0% of our consolidated
revenues, Business Services accounted for 22.7% of our consolidated revenues and
Broadcast and Transmission and Tower Services accounted for 9.3% of our
revenues. Also in 2001, 85.7% of our consolidated revenues were generated from
our operations in the UK, 10.6% of our consolidated revenues were generated from
our operations in Switzerland and 3.7% of our consolidated revenues were
generated from our other operations. We believe that our operational success to
date has been due largely to our focus on customer service and the development
of services that emphasize value rather than simply low prices. Our product
offerings incorporate our fundamental proposition of providing our customers
with a full range of choices.

     Our business is underpinned by the $15.9 billion investment we, and
companies we have acquired, have made in our network infrastructure. We provide
our broad range of services over local, national and international networks.
This network infrastructure consists of:

     - BROADBAND COMMUNICATIONS NETWORKS in the UK that currently pass
       approximately 8.4 million homes and can be expanded to cover over 11
       million homes in our regional UK franchise areas. These high-capacity
       two-way local broadband fiber networks serve entire communities
       throughout these regional franchise areas. Our fiber optic cables pass a
       significant number of businesses in these areas and are connected to
       distribution points, or nodes, which are typically within approximately
       500 meters of each of the 500 homes typically served by each node. Each
       home is then connected by a cable allowing us to deliver telephone, cable
       television and Internet services over a single integrated network.

Additionally, we have broadband cable networks in Switzerland and the Republic
of Ireland that currently pass approximately 2.3 million homes. These primarily
analog cable television networks are in the process of being upgraded to allow
for higher capacity signals and a suite of new products including digital
television, cable modem Internet access and voice telephony.

     - A NATIONAL/INTERNATIONAL SYNCHRONOUS DIGITAL HIERARCHY, KNOWN AS SDH,
       FIBER OPTIC TELECOMMUNICATIONS NETWORK in the UK which connects all of
       the major population centers in the UK to Ireland, continental Europe and
       the United States. SDH allows high speed data transmission and redirects
       transmissions in the event of a problem to prevent any disruption. This
       backbone network utilizes Asynchronous Transfer Mode, known as ATM,
       technology, a high speed, high bandwidth technology, and was built with
       sufficient duct capacity to accommodate over 2,300 fibers on the majority
       of the network. We designed this network to allow us to place the active
       components, such as routing devices, close to our customers, allowing us
       to offer a broad range of voice and data services.

       We do not insure the underground portion of our cable network. As
       substantially all of our cable network is constructed underground, any
       catastrophe that affects our underground cable network could result in
       substantial uninsured losses.

     - NATIONAL BROADCAST TRANSMISSION AND TOWER NETWORK INFRASTRUCTURE IN THE
       UK AND AUSTRALIA, which provide national, regional and local broadcast
       and wireless communications coverage. We own, lease, manage, or have
       access to, over 2,900 multi-user sites, including over 2,300 sites in the
       UK and over 575 sites in Australia. Our fixed line and tower networks in
       the UK are interconnected at numerous sites.

NTL'S BUSINESSES IN THE UK & AUSTRALIA

     We spent 2001 integrating our UK operations following several years of
acquisition and growth. Between 1998 and 2000, we expanded our UK operations
significantly, predominantly through acquisitions. Between June 1998 and July
1999, we acquired the UK broadband operations of Comcast UK Cable Partners,
Diamond Cable and ComTel as well as the Westminster and Milton Keynes cable
franchises of British Telecommunications, or BT. In May 2000, we further
increased our UK operations by completing our acquisition of the residential
broadband and business cable operations of Cable & Wireless Communications, also
known as Consumer Co.

                                        5
<PAGE>

     In the UK, we provide a broad range of communication services:

     - NTL: HOME, delivering broadband services to residential markets
       comprising residential telephone, analog and digital cable television,
       narrowband and broadband Internet access and interactive services;

     - NTL: BUSINESS, comprising business telecommunications, national and
       international carrier telecommunications, Internet services and radio
       communication services;

     - NTL: BROADCAST, delivering digital and analog television and radio
       broadcast transmission services, wireless network management, tower site
       rental and satellite and media services.

NTL: HOME

     We are the largest provider of broadband services in the UK. As of December
31, 2001, we had approximately 2.8 million residential cable television and
telephony customers and over 4.97 million revenue generating units, which we
refer to as RGUs. At such date, our penetration rates were approximately 35%
telephone penetration, 29% cable television penetration and 37% customer
penetration.

     Throughout 2001, we worked to streamline our subscriber base, removing a
backlog of approximately 45,000 non-paying and non-profitable customers in the
second half of the year. We are planning to remove an additional 14,000 in the
first quarter of 2002. We remove non-paying and non-profitable customers if our
standard collections procedures do not achieve a satisfactory result. The action
taken to remove non-paying customers provides us with a stronger customer base.
Our average churn rate for the quarter ending December 31, 2001 was 21.3% on an
annualized basis. Our average churn rate for the same period excluding
involuntary disconnects would have been 17.7% on an annualized basis.

     Broadband Internet usage by residential customers is a relatively new and
undeveloped market. However, we believe the most effective strategy to maximize
revenues and penetration for our residential offerings is to bundle together
telephone, cable television and Internet services. Our product and pricing
strategies emphasize choice, value and quality and are designed to encourage
subscription to multiple services to maximize customer retention and average
revenue per customer.

     Including capital expenditures made by the companies and businesses
acquired by NTL, we have spent approximately $11.2 billion on our network
infrastructure in the UK.

     Our core network consists of optical fiber connected to distribution
points, or nodes, each typically serving up to 500 homes, from which we provide
coaxial cable and two copper pair telephone wires into each home. This cabling
enables the provision of two telephone lines, an analog or digital television
service and a high speed cable modem service to each customer's home.

     Our fiber network has the capability to carry telephone services as well as
high speed data services. The fiber network is capable of supporting digital
subscriber lines, or DSL, which consist of a bi-directional 2Mb/s connection
capable of supporting 30 voice channels and enable the provision of higher
capacity services to business customers. We are able to support digital and
interactive services as well as advanced video services over our network through
cable modems that enable Internet access at almost 10 times the speed of
conventional dial up access.

     Our cable modem service has been engineered to provide high quality
residential high speed Internet access service. It is therefore able to support
small businesses and people who work from home, including enabling a link to a
company's local area network, or LAN. We have in place the next generation of
network technology using Internet protocol, or IP, over optic fiber cable
technology in our core backbone network. This technology, in which data is
broken up into discrete packets for transmission, enables more efficient use of
network capacity, meeting growth at lower unit cost and positioning NTL to
provide high speed broadband access on a mass scale.

                                        6
<PAGE>

  INTERNET ACCESS

     In March 2000, we announced a plan to offer our residential customers
throughout the UK free, unlimited Internet access via their personal computers
or, where available, televisions. This Internet service is called "ntlworld" and
became available to some of our customers beginning in April 2000. As of
December 31, 2001, we had approximately 695,000 ntlworld customers within our
local franchises and 29,000 customers who used our service via digital TV
access. We have decided to begin charging our customers for this service;
however, we believe that we remain highly competitive in this segment of the
market.

     Since the launch of ntlworld, the trend in UK Internet pricing has been
towards offering unlimited Internet access for a higher fixed charge, as
Internet penetration has grown and Internet usage has increased. In January
2002, we announced our decision to begin charging our customers for service and
the launch of two new packages: "Pay as you go", a metered service at 1p per
minute; and "Unlimited", an unmetered service at L10 per month. All subscribers
to the free ntlworld service will be transferred to either "Pay as you go" or
"Unlimited" during the first half of 2002. Existing ntlworld customers will
benefit from a L5 per month price for Unlimited for a period of time.

     In 1999, we were the first communications provider in the UK to launch a
high-speed cable modem Internet service, which links customers of our local
cable franchise networks to the Internet at up to ten times the speed possible
over standard telephone lines. As of December 31, 2001, we had approximately
118,000 cable modem customers. Approximately 80% of our networks are currently
able to provide this service to our customers. Our high-speed Internet service
currently operates at a speed of up to 2.0 Mb/s and is offered at minimum
delivery speeds of 128 Kb/s, 512Kb/s or 1Mb/s. The service is an "always on"
service, removing logging-on delays and the need to log off while using the
telephone. It uses the hybrid fiber coaxial cable portion of our broadband
network, which allows customers who also subscribe to a telephony service to
simultaneously make or receive telephone calls while accessing the Internet. The
128 Kb/s and 512 Kb/s services are currently offered at flat rates of L14.99 and
L24.99 per month, respectively, including the rental of a cable modem. This
compares with the newly announced prices for Freeserve and BTOpenworld 512Kb/s
ADSL services of L29.99 per month plus purchase of the modem. In the first
quarter of 2002, we launched a 1 Mb/s modem offer at a price of L49.99 per
month. We are currently the only provider offering 1 Mb/s service in the UK.

  FRANCHISE CUSTOMERS

     We first introduced a bundled cable service to our franchise customers in
1996, when we implemented a promotional pricing and packaging structure called
"Choices." Since then, we have continued to refine and enhance our offering. The
packages we currently offer to our UK residential franchise customers, excluding
customers in Milton Keynes and Westminster, where we plan to launch broadband in
2002, and in some former Cable & Wireless Communications franchises which only
offer cable television, comprise:

     - telephone service, including a second telephone line for an additional
       charge unless the customer decides not to take television (99% of
       potential customers are now offered the "3-2-1" simplified telephone rate
       plan);

     - narrowband Internet access service, if the customer takes a telephone
       service (97% of potential customers can subscribe for ntlworld flat rate
       narrowband Internet service);

     - broadband Internet access service (two thirds of potential customers can
       subscribe for 128 Kb/s or 512 Kb/s broadband Internet service);

     - all of the current terrestrial television channels and access to
       multi-channel television, including pay per view; and

     - interactive television services.

     Our packaging and pricing are designed to encourage our customers to use
multiple services such as dual telephone and broadband, dual telephone and
narrowband, dual telephone and TV, or triple telephone, TV and Internet access.
Only telephone, with its low capital expenditure requirements and high margins,
is available
                                        7
<PAGE>

widely as a stand-alone single product. Of our competitors, only Telewest, which
does not offer its services in our franchise areas, is able to offer the full
range of services we provide (see table below).

<Table>
<Caption>
                                               INTERNET   TV    TELEPHONE
                                               --------   ---   ---------
<S>                                            <C>        <C>   <C>
NTL..........................................     *        *        *
BT...........................................     *        X        *
BskyB........................................     X        *        *
Telewest.....................................     *        *        *
</Table>

  CABLE TELEVISION

     The selection of analog cable channels that we currently offer to our
franchise customers varies based on the particular franchise area. This
variation is a result of the different channel offerings we have inherited as a
result of our acquisitions of various cable franchises over the past several
years. Variation between franchise areas will increasingly be removed as digital
cable television is rolled out offering the same channels, subject to regional
programming variations. In addition to offering many of the popular channels
available on BSkyB's satellite platform, we also offer to all of our franchise
customers, through our joint venture with Telewest, a cable-only movie, sport
and special events pay per view television service called "Front Row" that we
rolled out to our customers beginning in March 1998. Our joint venture with
Telewest represented the first ever alternative in the UK to BSkyB in the
provision of films and sports events through pay television. Front Row has
signed content output contracts with major Hollywood studios, including Warner
Brothers, Sony Pictures Entertainment (Columbia/Tri-Star), the Walt Disney
Company (Walt Disney Studios, Miramax, Hollywood Pictures and Touchstone),
Dreamworks, MGM and Universal.

  INTERACTIVE SERVICES

     We have moved rapidly to take advantage of the convergence between the
Internet and television and the advent of digital cable television. We are
currently aggregating a broad range of interactive content into a service that
can be deployed as part of our interactive television offering to our
residential customers. Our interactive offering comprises a free television
e-mail service, a "walled garden" of partner websites that have been specially
redesigned for television and an online customer service application that allows
select customers to see their NTL bill via the television.

     We have established relationships with over 75 content providers to deliver
a wide range of interactive services, including education, shopping and banking,
finance, travel, entertainment, games, news, sports and local content.
Interactive content is organized into channels, including news, sports, travel,
lifestyle, money, entertainment and shopping. Our partners include Sainsburys,
Iceland, QVC, W.H. Smith and Domino's Pizza. The travel channel includes content
partners such as Go Airlines, Thomas Cook Travel Select and Teletext and the
money channel features content partners such as Abbey National, The Halifax and
Bloomberg.

     We also offer additional channels providing up to date news and weather
information, games and educational content. Where appropriate, our contracts
with content providers require the payment of tenancy fees as well as
commissions on e-commerce transactions. We also derive revenues from the
advertising opportunities that exist across our interactive service offering.

  TELEPHONY

     In 1999, we launched the NTL "3-2-1" call plan for our residential
franchise customers where national and local calls cost only three pence per
minute during the day, evening calls cost two pence per minute and weekend calls
cost one pence per minute. We are able to offer this plan by using our national
telecommunications and local networks and bypassing a portion of the wholesale
long distance fees which would otherwise be charged by BT and other carriers for
carrying calls to and from our local franchise networks. In 2002, we have begun
the roll-out of our "Talk Unlimited" service, whereby customers can make
unlimited calls on evenings

                                        8
<PAGE>

and weekends to local and national fixed line numbers for a flat fee of L8 per
month in addition to their standard line rental.

  INDIRECT ACCESS

     On November 7, 2001, we announced our sale of the right to offer services
to approximately 230,000 indirect access telephone customers to Innogy for
approximately L23 million ($33 million) including the collection of certain
future service revenues and existing receivables.

     We acquired these indirect access customers as part of the acquisition of
the residential businesses of Cable & Wireless Communications in May 2000.
However, as these customers were not connected to our national backbone network,
they could not benefit from our simplified calling tariffs, cost base or dial-up
Internet service. Rather than risk the substantial churn associated with the
process of migrating the customers to the NTL network and services, we
determined that the sale of the customer base would result in the highest
realizable value of the asset.

     As of December 31, 2001, we had approximately 118,000 off-net customers of
which approximately 89,000 are also customers of our ntlworld Internet service.
We do not incur the unfavorable interconnect costs that were related to
servicing the Cable & Wireless indirect access telephony base because these
indirect access customers are served by our national network.

  CUSTOMER MANAGEMENT SYSTEMS

     For most of our franchise areas, we use advanced billing and customer
management systems which enable us to control all aspects of a customer's
account for both telecommunication and television products. We currently operate
a number of billing systems inherited from the different operations we have
acquired. We are in the process of merging these different systems onto a single
platform, which we expect will reduce costs and improve customer satisfaction.

  PREMIUM TV

     Premium TV Limited, which is a wholly owned subsidiary of NTL, has a joint
venture with Eurosport, the pan-European basic tier sports channel, to develop
British Eurosport, a version of Eurosport tailored to appeal to UK viewers. This
channel is now available to all of NTL's UK pay television homes.

     Premium TV has also entered into long-term joint ventures with a number of
UK football (soccer) teams including Rangers, Leicester, Middlesbrough and
Newcastle, as well as the Football League, which represents 76 teams, and has
entered into a five-year operating agreement with Aston Villa. These joint
ventures are intended to develop the football teams' Internet and broadband
rights which may include audio-visual footage of matches on a delayed basis and
live audio coverage of matches.

     Premium TV is developing a Classic Sports television channel, and has a
contractual arrangement with the BBC permitting Premium TV to show historical
football (soccer) matches from the BBC's library.

NTL: BUSINESS

     The primary objective of our business services division in the UK "ntl:
business" is to provide a comprehensive range of voice, data and application
based communications services for our business customers.

     Our existing customer base incorporates both private and public sector
organizations. Within the private sector we focus on the areas of finance,
utilities and travel. Within the public sector we have a substantial share of
the market in emergency services, local government and education
telecommunications requirements.

     Our business strategy is to fully exploit our superior network capability
and place an increasing emphasis on broadband products and services. Rather than
simply offering our customers a lower price for their existing service, we offer
a package of services designed to address all their communications needs at a
price which offers good value. For our smaller business customers, we are
providing a range of bundled packages based on

                                        9
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our standard services and standard terms and conditions. For our larger
customers, we offer services which are tailored for their specific needs.

     ntl: business has developed a diverse portfolio of skills and services
through both product development and a number of significant acquisitions.
Beginning in 2000, we commenced a program to integrate the skills and abilities
of employees from Workplace Technologies, X-tant and ConsumerCo's small business
team with those of the existing business telecom operations, to create a single
integrated portfolio and customer support organization. Another example of this
strategy is our acquisition in the third quarter of 2001 of the UK assets and
contracts of Viatel UK. Viatel was a provider of managed data and voice services
to UK based corporate companies and also provided voice services to resellers,
voice and Internet services to wholesalers and managed data services to other
European managed service providers. In addition, we continue to focus specific
sales and marketing efforts on winning business customers in our franchise areas
and increasing revenue from our existing customers.

     Since August 1, 2001, ntl: business has been structured with three key
business units within the overall UK communications market. These business units
are Retail, Managed Network Services (incorporating Mobile, Enterprise, Public
Safety and VISP) and Carrier Services. The segmentation enables us to develop a
deeper understanding of our customers' businesses which enables us to craft
specific solutions and trading alliances appropriate for each specific market.
The discussions below reflect the old structure of ntl: business.

     Following our analysis of published OFTEL statistics for telecommunications
services, and Gartner Group statistics for other communications services, we
estimate the size of the market in which we compete to be in excess of L24.5
billion for the year 2002. Of the total communications market, we estimate that
approximately L17.5 billion represents business telecommunications and L7
billion represents carrier telecommunications services.

     Our network already passes within 200 meters of more than 570,000 business
premises in the UK. However, as a result of the reach of our national network,
we can serve a substantial portion of the UK's approximately 1.2 million
business premises through means such as indirect access. These premises host
approximately 1.5 million business customers. We believe that the architecture
and reach of our network infrastructure has positioned ntl: business to play a
leading role in the delivery of broadband services to UK businesses going
forward. We plan to exploit demand for broadband services primarily through our
broadband cable modem product which was launched in the second quarter of 2001,
and our E-1 Direct Internet Access Service. We will continue to market our
standard products and services ranging from telephony and Internet access to
data and e-commerce and managed services. These services will be delivered via
copper wire, coaxial cable, fiber and wireless.

  RETAIL AND ENTERPRISE

     In our local direct markets (retail), our approach is to "think nationally
but act locally." In our business markets, our approach is to enable businesses
to become more efficient and effective. Our focus is on small to medium sized
businesses.

     Our business model for dealing with small businesses has changed over the
last twelve months. In October 2000, we opened a new small business call center
which uses telephone account management techniques to sell and service a range
of simple business bundles for smaller businesses across the UK. Under this new
business model, we have developed sophisticated marketing programs for our
target customer base. In the second quarter of 2001, we added broadband services
to the business bundle. In December 2001 we launched our new web site allowing
customers to self provision a range of products and view their bills on-line.

     Across these market sectors, we plan to utilize our national capabilities
and the expertise of our market focused account management and technical support
teams to target specific business sectors and increase penetration.

     As of December 31, 2001, we had approximately 76,000 business customers
with an average of 5.1 lines per customer for a total of approximately 380,000
retail business telephony lines installed in the UK.

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<PAGE>

     We offer the following business products and services to our business
customers:

     - ACCESS SERVICES that connect our customers to us for inbound and outbound
       voice and data calls. These access services include additional analog
       business exchange lines, or BELs, and digital business exchange lines, or
       DELs. DEL services include basic rate access, also known as ISDN2, and
       primary rate access, also known as ISDN30. We believe these and other
       direct and indirect access services are priced competitively and are
       often in competition with similar services provided by a number of other
       direct and indirect suppliers. In the second quarter of 2001, we launched
       a business cable modem service that enables the delivery of broadband
       services to our business customers.

     - MANAGED VOICE SERVICES/VIRTUAL PRIVATE NETWORKS that are best illustrated
       by our central exchange "Centrex" service. Through this service we
       provide our customers with business exchange lines configured as a
       "virtual PABX," where we provide the services normally associated with a
       traditional PABX located at a customer's premises. We provide these
       services on a rental basis which allows our customers to avoid the
       expense associated with an outright capital purchase and maintenance
       costs.

     - MANAGED DATA SERVICES that include point to point private circuits at
       speeds of multiples of 64 Kb/s and individually tailored 100 Mb/s and 155
       Mb/s services. Other services include the provision of inter-site data
       services with particular transmission protocols, such as Internet
       Protocol also known as TCP/IP, Frame Relay and ATM.

     - MANAGED LOCAL AREA NETWORKS (LANS), in order to support the developing
       needs of our business market, we have established significant
       capabilities that enable us to fully manage LANs or to design, project
       manage and integrate new LAN platforms for our customers.

     - 08XX SERVICES that include free local and national call services together
       with a range of other routing features based on our network. These
       services enable our customers to manage inbound calls and establish
       varying tariffs for their customers to contact them.

     - INTERNET SERVICES, in order to provide our customers with the tools they
       require to build their e-business services including dedicated,
       high-speed Internet access services, web hosting services, and specific
       individually tailored applications securing and protecting their
       e-businesses. The range of services we provide also includes the
       provision of simple, inexpensive software to enable our customers to
       begin doing business over the Internet.

     We have a variety of alternative methods to carry our national
telecommunications network over the "last mile" to the premises of those
customers which are located outside of our franchise area:

     - Obtaining permits to construct telecommunications networks, and building
       out our network to reach our customers. Although this is often the most
       costly means of reaching a customer, the expense can be justified in the
       case of larger customers or where a significant level of traffic is
       obtained from a customer. For example, we have extended our fiber optic
       network within London to reach and support CNN's facilities.

     - Leasing circuits on the local networks of other service providers to
       connect to our customer's premises. Although this may reduce the
       operating margin on a particular account, it requires significantly less
       capital expenditure than a direct connection, can often be put in place
       relatively quickly and can be replaced at a later date if traffic volumes
       justify it.

     - Connecting customers to our national telecommunications network by
       implementing microwave radio links which utilize our significant tower
       infrastructure to connect our network to our customers, using digital
       point to point microwave radio links. Alternatively, we believe our
       license to operate radio fixed access services on a national basis
       throughout the UK at the 10 Ghz frequency, could enable us to use
       "wireless local loop" technology to connect our network to our customers,
       although we are not currently utilizing this approach. Either of these
       two methods requires the installation of a mini-tower site on the roof of
       the customer's premises to receive and broadcast data. "Wireless local
       loop" connectivity would enable a radial transmission to a number of
       sites surrounding the mini-tower whereas point to point connectivity
       enables transmission between two points only.
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<PAGE>

  PUBLIC SAFETY

     In addition to meeting the traditional voice and data requirements of
businesses throughout the UK, our Radcomms business offers a full range of
communications services, including the design and operation of radio networks
and the provision of support, maintenance and facility management services to
customers who provide public safety services to the community. Our customers
include primary providers such as police, fire and ambulance and secondary
providers such as H.M. Prison Service, the Coast Guard and the Royal National
Lifeboat Association. We have been servicing a substantial portion of the radio
installation and maintenance market for public safety in the UK for many years
and our public safety customers provide us with a relatively steady source of
revenue.

     We intend to position ourselves to increase our activities in the public
safety sector from facilities and maintenance activities into complete
outsourcing arrangements. We believe we are at the forefront of managed
communication services in the public safety sector, and we believe that the
majority of the British Public Safety Services will move from their current
service arrangements into outsourcing and the provision of fully managed
services. We believe we have already established a strong position in
outsourcing services and facility management for these mission critical
customers, and plan to continue to build on our existing relationships with
current customers. An example is the Metropolitan Police Authority (New Scotland
Yard), for which we manage communications services for over 25,000 police
officers.

  WHOLESALE (CARRIER SERVICES, MOBILE AND VISP)

     Our wholesale markets group's main focus is the supply of UK infrastructure
and bandwidth to national and international telecommunications operators. Our
national and local networks are used to interconnect these carriers to cities in
the UK and Ireland. NTL wholesale has seen continued growth over the last five
years, and has successfully positioned itself as a key supplier of wholesale
services. We expect to continue to serve the wholesale marketplace through our
strategy of providing high quality and competitively priced services which can
be customized where necessary.

     Our customers include fixed wire line and mobile telecommunications
operators and Internet service providers, or ISPs, such as AOL, COLT, Worldcom,
other cable operators, and various information technology and facilities
management companies. A dedicated team addresses the needs of the UK mobile
operators, and we are a major supplier to Vodafone and Orange. We have developed
a successful business supplying core interswitch network capacity to UK mobile
operators and have commercial relationships with the four incumbent mobile
operators.

     We have been instrumental in developing a new commercial and technical
model for the supply of networks to the mobile operators. These developments
culminated in our being awarded, in April 2000, a five-year L150 million
contract by Orange. A key element of the contract, by which Orange outsources
the maintenance and provisioning of that network, is the extension of our
existing core network. All five third generation mobile operators in the UK will
need to implement network and services to support 3G services, and we will work
to define and co-ordinate our strategy for supporting 3G services.

     A growing area of our wholesale business is selling voice termination
services to a wider mix of operators, and using these relationships to reduce
the cost-base for our telephony traffic by:

     - creating a self sustaining revenue stream,

     - establishing commercial relationships with wholesale customers thus
       enabling us to cross-sell and up-sell other products, and

     - generating revenue and cost reduction opportunities for other parts of
       NTL.

     The growth in the number of international operators building and operating
submarine cable systems in recent years has been substantial, with many of the
cables crossing the UK. We have considerably increased physical connectivity to
UK international cable landing stations and developed products to address the
needs of the international cable operators for carrier services between the
cable landing sites and the major UK international nodes such as Telehouse,
London, which services are also known as "backhaul" services.
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<PAGE>

     Utilizing our ATM national network, we have developed Frame Relay and ATM
wholesale products to meet demand for high-speed data connectivity.
Additionally, our core data network, local loop infrastructure and connectivity
to the main international nodes, will allow us to address the needs of
international operators for the termination of UK-bound and origination of
UK-generated data traffic.

     In addition to wholesale telecommunications and data services, we also
offer wholesale Internet access solutions including network services, call
center operations and customer provisioning and billing to UK ISPs and other
corporate customers that would like to expand their Internet presence. This
service was launched in 1995.

NTL: BROADCAST

     On April 2, 2002 we announced that we had completed the previously
announced sale of our Australian broadcast business to Macquarie Bank for A$850
million (US$448 million) in an all cash transaction. At that time, the business'
bank debt outstanding, which was subsequently extinguished, totaled A$227
million (US$118 million).

     NTL Australia owned and operated the most extensive terrestrial broadcast
transmission network in Australia with over 98% population coverage provided
from 578 sites located across metropolitan, regional and rural areas. For the
year ended December 31, 2001, NTL Australia's revenues were approximately A$119
million (US$62 million) generating EBITDA of approximately A$52 million (US$27
million). NTL's Australian operations also include a 51% share in a joint
venture, NTLT, with two Australian regional broadcasters (WIN Television and
Southern Cross Broadcasting) operating a carrier grade wholesale microwave
telecommunications network along the east coast of Australia.

     We own and operate wireless communication and broadcast transmission
infrastructure in the UK and, until the completion of the sale on April 2, 2002,
in Australia. We provide our customers with enhanced products and services
through our broadcast network, state of the art equipment, and innovative
facilities management expertise. Our customer base includes over 1,000
companies, including all of the leading UK mobile wireless operators and all
major commercial television and radio broadcasters.

     We have a proven history of developing new products and services to meet
the needs of our customers and drive the growth of our business. These
developments include the implementation of Teletext, a text based data service
transmitted with the analog television signal, the implementation of NICAM in
the 1980s enabling the transmission of digital stereo and Dolby audio over
analog television transmissions, and most recently the design and implementation
of the world's first digital terrestrial television and digital audio
broadcasting networks and services for our UK and Australian broadcast
customers.

     We provide products and services to three distinct market areas:

     - SITE LEASING AND SERVICES.  We operate the second largest independent
       portfolio of wireless towers and sites available for lease in the UK and
       one of the largest towers and sites portfolios in Australia. In total, we
       operate over 2,900 multi-user sites (approximately 2,370 of which were in
       the UK as of December 31, 2001), up from approximately 600 sites in May
       1996. As of December 31, 2001, we leased space on our towers to over
       4,200 lessees including all of the major wireless operators in the UK and
       also offer unique services such as "In-Building" a wireless connectivity
       that can enhance their wireless coverage in high-traffic areas such as
       shopping malls, office buildings and conference centers.

     - BROADCAST TRANSMISSION AND SERVICES.  We own and operate one of two
       television broadcasting infrastructure networks in the UK as well as the
       only national broadcasting infrastructure network in Australia.
       Additionally, we have national, regional, and local radio broadcast
       infrastructure networks in both the UK and Australia. We developed the
       first commercial digital terrestrial television service in 1998 and the
       first commercial digital radio station in 1999. Because, unlike
       broadcasters in the United States, we own and operate not only the towers
       but also the broadcast transmission infrastructure, our broadcast
       customers rely on our network and package of integrated turn-key services
       to distribute and broadcast their content.

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<PAGE>

     - SATELLITE AND MEDIA SERVICES.  We provide satellite and media services in
       the UK and value-added services such as playout, fixed and mobile
       satellite up-linking, and a wide range of occasional & outside broadcast
       services to generate incremental revenue. Our ability to offer a full
       range of services from content gathering, distribution & transmission is
       unique in the UK market.

     Our broadcast and wireless customers generally hold long term licenses and
enter into service agreements with us that typically last 10 to 15 years.

  SITE LEASING AND SERVICES

     We operate a UK wireless infrastructure network of approximately 2,370
multi-user sites as of December 31, 2001. We own, lease or manage approximately
1,570 UK sites and have access to approximately 800 undeveloped sites. Our
primary business is the leasing of antenna space on our sites to a diverse range
of wireless service providers, including providers of mobile telephony, paging,
specialized mobile radio, or SMR, and wireless local loop services. We have also
developed a range of complementary services that utilizes our tower expertise,
including infrastructure services, site selection and acquisition, design and
construction, antenna installation, network planning and management, and tower
maintenance.

     Our network in the UK is national in scope and includes most of the major
population centers and highways. Our wireless customers currently include all of
the UK mobile telephony operators, including Vodafone AirTouch, mmO(2) (formerly
known as BT Cellnet UK), Orange, One2One and Hutchison 3G, all the major paging
companies, and many of the UK's largest wireless telephony carriers, including
BT, Cable & Wireless, and Thus plc. We also serve several utility companies and
emergency service organizations including British Gas, London Ambulance and Her
Majesty's Customs and Excise.

     Second generation wireless services have been the major driver of our
growth to date, but the advent of third generation wireless services is expected
to drive further revenue growth. During 2000, the UK government awarded five
national Universal Mobile Telecommunications System, or 3G, licenses each for a
duration of 20 years, commencing January 2002. These licenses have been awarded
to four existing operators, all of whom are existing wireless customers of ours,
and to one new entrant. Under the terms of these licenses, each operator will
provide services to at least 80% of the UK population by December 2007.
Construction of these networks has commenced in 2001 and is expected to generate
significant further demand for suitable existing & new sites over the next few
years. The increased demand for suitable sites is driven by the greater
bandwidth and different range characteristics of 3G technology, inherently
requiring a greater number of sites than 2G technology.

     The dramatic growth of wireless communications necessitates good cellular
coverage in all commercial areas, leading to a requirement for reliable wireless
communications infrastructure inside buildings. We believe this creates a new
type of radio site which, unlike towers, will exist within commercial buildings,
transport hubs, shopping malls and other large buildings. Our analysis shows
that there are approximately 2,000 of these types of commercial properties in
the UK. As at December 31, 2001, we had built shared coverage systems in 26
large buildings including Bluewater, Britain's largest shopping complex and
Canada Square, part of London's Canary Wharf complex.

     Building on the technology we developed for In-Building services, we are
exploring with UK mobile operators ways of using our fiber network to solve the
distance, coverage and power problems associated with 3G rollout in urban areas.
Although in an early stage of development, we believe that a solution utilizing
small low-profile antennas, positioned on buildings and other street level
infrastructure and connected via our fiber network to remote base stations,
could improve coverage and service quality compared to more traditional rooftop
sites for 3G technology.

  BROADCAST TRANSMISSION AND SERVICES

     We have been involved in broadcast television since the 1950s when we
designed and built the television transmission system for the UK's first
independent commercial television network. Through our national infrastructure
of owned and shared transmission sites and our owned network of transmitters in
the UK and

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<PAGE>

Australia, we provide broadcast signals for the three commercial national
television channels in the UK (ITV1, Channel 4, Channel 5), the two
publicly-owned national broadcasters in Australia (ABC, SBS), a number of more
recently established commercial channels through the UK Digital Broadcast
multiplexes, and many of the UK's independent local, regional and national radio
broadcasters.

     An attractive feature of our broadcast contracts is our ownership of both
towers and transmission equipment responsible for generating the broadcast
signal. As a result, the contracts increasingly have become end to end solutions
including all technical and service aspects of providing the transmission for
the broadcaster. In essence, TV and radio station owners are programmers and we
are the broadcaster. We have used this as an opportunity to develop strong
relationships with our customers, which in turn has helped us to better
understand their needs and customize new services for them.

     Television broadcasting.  We provide digital and analog broadcast
transmission services for national and regional television broadcasters. The
analog network provides coverage to 99.8% of the UK population, with
approximately 3,500 broadcast transmitters. Our extensive television broadcast
customer base includes all of the UK commercial terrestrial television broadcast
companies consisting of the ITV national network of 15 affiliated stations, the
national services of Channel 4 and Channel 5, as well as the regional service
S4C in the UK. In addition, we provide transmission and site services to both of
Australia's publicly-owned national broadcasters, ABC and SBS.

     We provide digital terrestrial broadcast transmission for two of the three
commercial national digital television services in the UK. These services carry
up to 12 separate channels, including the ITV network, Channel 4, Channel 5 and
a range of new digital channels and services such as pay per view. As of
December 2001, we were operating 80 digital terrestrial television transmitting
stations reaching approximately 88% of the UK population.

     Digital broadcast systems require a more complex engineering design than
their analog predecessors. We have exploited this by extending our range of
services to include tower leasing and transmission services (as with analog)
plus "end-to-end" system integration and service ranging from studio playout
centers to terrestrial transmission. This has the twin benefits of enlarging the
total market available from broadcasting and further differentiating us as a
unique provider able to offer towers, transmission and system integration
services for digital television.

     Radio broadcasting.  We are one of two major companies providing
transmission sites and services to the radio industry in the UK. We offer a
range of services to radio broadcasters including: target service area planning;
site location; installation and commissioning; and equipment selection,
procurement, operation, monitoring and maintenance. We believe that we are a
supplier of transmission services to a substantial portion of the addressable
market. Our radio broadcast customer base includes two of the three national
commercial stations: Classic FM and Talk Radio, over 200 metropolitan, regional
and local stations and the first all digital radio station, Digital One, of
which we are a founding equity partner with a 37% equity interest. We have a
contract for the transmission of Digital One with a lifetime value in excess of
$75 million. The UK government has embarked on a program of licensing a number
of new regional and local digital radio multiplexes. As of December 31, 2001 we
have secured contracts to build transmission and supporting network for 24 of
the 27 licenses awarded so far.

  SATELLITE AND MEDIA SERVICES

     We own and operate satellite up-linking facilities consisting of over 30
fixed satellite up-link dishes able to access over 50 satellites with global
coverage, a network of mobile and transportable up-links, management and control
systems and all associated operations and maintenance. We provide our satellite
customers with program and content distribution services for over 160 full-time
channels via satellite and fiber. In addition, we have facilities for playout
services, remote satellite news gathering, and full outside broadcast. Through
an alliance with Williams Vyvx, a Williams Co. company, our customers also have
access to 48 cities in the United States.

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<PAGE>

     We have expanded our service offerings over time to meet the growing needs
of our customer base as new technologies create new broadcast markets. As a way
to add incremental revenue, we have begun to integrate backwards with our
existing customers by offering value added services. Such service developments
include:

     - establishment of playout services, which enable us to take ownership of
       the customer's transmission needs from the point that it delivers the
       program or content and needs a channel to be created. We then are
       responsible for all the operational issues related to the broadcast of
       that content. We have a state of the art playout facility outside of
       London designed to meet the rising demand from broadcasters across
       Europe.

     - offering a range of occasional use broadcast services that allow media
       content providers to outsource their off-site broadcasting needs, whether
       it be for breaking news, sports events or music concerts, and still
       deliver the desired content to their customers via our mobile equipment.

     Our Satellite and Media customers include programmers who own and operate
packages of content or channels, news agencies, sports broadcasters and
production companies. Our customer list includes such market leaders as AOL/Time
Warner (CNN, Turner, Cartoon Network), BBC, Discovery Channel, QVC, Reuters, the
Associated Press and British Sky Broadcasting.

NTL'S BUSINESSES AND INVESTMENTS IN CONTINENTAL EUROPE & THE REPUBLIC OF IRELAND

  EUROPEAN BUSINESSES AND INVESTMENTS

     Prior to 2001, we made several strategic investments in leading European
markets. In July 1999, we acquired Cablelink in the Republic of Ireland, which
then had over 400,000 franchise homes in Dublin, Galway and Waterford. In two
steps during August 1999 and December 1999, we acquired the "1G" Networks in
France, our first acquisition in Continental Europe, acquiring approximately
266,000 franchise homes in the Greater Paris area. In March 2000, we completed
the purchase of the cable assets of the Cablecom Group, Switzerland's largest
cable company. Also in March 2000, we acquired a 25% interest in Svenska
Bredbandsbolaget A.B., or "B2", a company based in Sweden, which is deploying
fiber directly to the home in Scandinavia. Finally, in August 2000, we acquired
a 50% interest in eKabel InvestCo, which owns 65% of eKabel L.P., the cable
network in the Hessen province of Germany.

     In May 2001, we completed the purchase of a 27% minority investment in Noos
S.A., the market leading French broadband company. We subsequently merged 1G
Networks into Noos in November 2001. In September 2001, we increased our
minority interest in B2 to 34%.

     Our European strategy has three key components:

     - continue upgrade of network infrastructure in Switzerland and France and
       begin upgrade in Germany for delivery of advanced broadband solutions to
       consumers and businesses,

     - replicate our success with bundled services in the UK in order to drive
       penetration of new products and maximize profitability per subscriber,
       and

     - realize the benefits of economies of scale through continued integration
       while maintaining a regional focus on customer operations.

     We have a premier footprint across Europe, including:

     - Europe's three largest financial centers -- London, Paris and Frankfurt;

     - Europe's wealthiest population -- Switzerland; and

     - Europe's most advanced broadband market -- Sweden;

     As of December 31, 2001 we had access to 20.3 million franchise homes
across the UK, Ireland and Continental Europe, and served approximately 7.1
million customers (assuming 100% ownership of our minority interests).

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<PAGE>

     Across Europe we continue to focus on capital efficient upgrades of these
cable networks for the delivery of bundled high-speed Internet, digital cable
television and telephony services to the consumer market and advanced broadband
services to the business community.

     In 2001, we benefited from the significant demand for broadband services.
Significant progress in focused network upgrades and a commitment to market to
the most attractive demographic areas first have been the focus for achieving
meaningful penetration and return on investment. Evidence of the success of this
strategy has been our broadband penetration. By December 31, 2001, we achieved
20% penetration of marketable homes in Switzerland, and 34% in Sweden, and had
more than 229,000 broadband customers in continental Europe (assuming 100%
ownership of our minority interests).

  SWITZERLAND

  Cablecom GMBH

     In March 2000, we acquired the business and assets of Cablecom GMBH,
Switzerland's largest cable operator. Cablecom is Switzerland's largest cable
operator with approximately 53% of the Swiss cable television market as of
December 31, 2001. As of December 31, 2001, Cablecom delivered products and
services to 1.4 million subscribers in 100% ownership service areas, reflecting
a penetration rate of approximately 91%. Cablecom also delivers signals via its
national fiber backbone to other cable operators who serve another 490,000
subscribers, including third party wholesale and partial ownership of signal.
Over 90% of television broadcasting in Switzerland is delivered over cable
networks. As of December 31, 2001, Cablecom also had over 67,000 broadband
Internet and 48,000 digital television customers.

     Cablecom also owns SwissOnline, one of the largest Internet service
providers in Switzerland with approximately 161,000 dial-up customers as of
December 31, 2001. Cablecom already has a telecommunications license to provide
voice, data and other value added services in Switzerland, and expects to
commercially launch its Voice over Internet Protocol, or VoIP, telephony product
in 2002.

     Cablecom is the largest alternative fiber link telecommunications operator
in the Swiss telecommunications market.

     Cablecom's business extends beyond basic television services. Our objective
is for Cablecom to become the premier provider of communications services for
Switzerland's residential and business markets.

     During the third and fourth quarter of 2001, our European management team
took an active role in managing the business in Switzerland. We reorganized
Cablecom's management and organizational structure to a customer focused
organization -- marketing the product for the consumer and realizing Cablecom's
unique business to business opportunity. In 2001, we integrated several business
units and legal entities, reducing the number of departments from 13 to 7,
thereby reducing multiple interfaces to the customer.

     As part of the reorganization, in October 2001, Rudolf Fischer joined the
European management team as the new Chief Operating Officer of Cablecom. We have
also hired Cablecom's first Chief Marketing Officer, and through internal
candidates, Cablecom's Chief Financial Officer and Head of Consumer Services. As
part of the effort to streamline Cablecom and reduce costs, we also implemented
a redundancy plan in 2001, reducing headcount by 260 out of 1,960 full-time
equivalent employees.

     Core elements of our strategy for Cablecom include:

     - introducing value added services, including high speed Internet, digital
       television, pay-TV, video- and audio-on-demand, and telephony,

     - installing superior customer care operations in order to support growth
       in the number of direct customer relationships and the rollout of new
       products and services, and

     - increasing capacity in major cities and suburban areas and increase
       bi-directionality beyond the current one million homes.

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Given NTL's limited liquidity and the reorganization process, Cablecom has
considerably reduced expenditure necessary to implement this strategy which will
result in a delay in implementing that strategy.

     Cablecom currently operates in the following five business areas:

     - Fully Owned Cable Networks.  Residential cable television is Cablecom's
       largest business and comprises 28 different cable networks of which six
       are wholly-owned by Cablecom. This accounts for approximately 90% of
       total managed subscribers. As of December 31, 2001, Cablecom had 53%
       market share in Switzerland and a penetration rate of over 90% of homes
       passed, 82% of homes passed have been converted to digital and 53% of
       homes passed had bi-directional capability. Approximately 48,000 digital
       television customers and 67,000 broadband Internet subscribers were
       connected at year-end. Approximately 82% of Cablecom's subscribers are in
       the German speaking region of Switzerland, 10% in the French speaking
       region and the remainder in the Italian speaking region.

     - SwissOnline.  SwissOnline, a wholly owned Cablecom subsidiary, is one of
       Switzerland's largest Internet service providers and one of the leading
       portals in the country. As of December 31, 2001, SwissOnline had
       approximately 161,000 subscribers. As part of the Cablecom reorganization
       in 2001, SwissOnline was integrated with Cablecom's high speed Internet
       product management and customer operations.

     - Cablecom Business.  Cablecom Business, formerly know as Carriers
       Solutions or National Telecoms, was launched in January 1999 to offer
       advanced data services to the Swiss business segment. With one of two
       national fiber backbones, Cablecom Business provides voice and data
       services to the small, medium and multi-site national segments. Current
       products include leased lines, virtual private networks, connectivity,
       and carriers' carrier services. Cablecom intends to intensify the
       roll-out of its national telecommunication and data services in 2002.
       Cablecom believes that it is well positioned to connect business
       customers within its service areas as it estimates that most business
       customers are within 50 to 100 meters of Cablecom's existing network
       infrastructure.

     - Rediffusion.  Rediffusion, Cablecom's consumer electronics retail chain,
       sells consumer electronics products and accessories. It also has rental,
       maintenance and service and repair operations. Historically, Rediffusion
       has been run independently of Cablecom's cable operations. As part of the
       company's reorganization, Cablecom is currently integrating Rediffusion
       to leverage the retailer's extensive national network to distribute
       Cablecom's broadband multi-service offering, including digital cable
       television, high-speed Internet and telephony services and to bundle
       those with Rediffusion's products and services, including installation
       and maintenance.

     - Engineering.  Cablecom Engineering AG, a wholly owned subsidiary of
       Cablecom, provides cable television engineering services to Cablecom and
       third parties. Cablecom Engineering AG is the leader in Swiss cable
       television engineering with a market share of 75%. Services include
       third-party cable television systems and network infrastructure planning
       and design, project management, and network measurement and maintenance.
       As part of the company's reorganization, Cablecom Engineering was
       integrated into the Cablecom network division in 2001.

     NETWORK UPGRADE.  Cablecom is currently upgrading its nationwide network,
which consists of three interconnected segments:

     - Fiber optic backbone

     - Hybrid-fiber coaxial or "HFC" network

     - In-house installations

     Through our network upgrade program, over 82% of homes passed were upgraded
at the end of 2001. Moreover, as HFC networks in each area are upgraded,
Cablecom upgrades in-house installations at the request of subscribers wishing
to subscribe to new services, including digital cable television, high-speed
Internet and telephony services.

                                        18
<PAGE>

     Cablecom has significantly reduced its expenditures on upgrading its
network as a result of NTL's lack of liquidity and the reorganization process
which will delay completion of the upgrade program.

     CABLE TELEVISION SERVICES.  In November 1999, Cablecom launched digital
services under the SwissFun brand name in German-speaking regions. Using a
purchased or leased set-top-box, Cablecom subscribers can access an additional
30 digital channels for free, as part of their basic television subscription
offering. The subscribers can then subscribe to over 20 additional channels in
pay packages. Cablecom continued the roll-out of its SwissFun digital television
offering during 2001, concurrent with the upgrade of its regional networks.

     In addition to increasing the number of channels that can be broadcast, the
introduction of digital broadcasting allows Cablecom to address each set-top-box
individually, providing Cablecom with the necessary flexibility to bundle
expanded basic and pay channels into more attractive pay packages. This
customization of content and the potential to differentiate substantially from
the basic television offering is expected to make pay television much more
attractive than its current form. In 2002, Cablecom plans to offer additional
pay packages and pay-per-view services over its network.

     INTERNET SERVICES.  Cablecom will continue to roll out high-speed Internet
access services throughout its service areas as its networks are upgraded to
bi-directionality through 2004. To maximize the return on capital expenditure,
Cablecom is first upgrading subscriber areas where demand is the highest. As of
December 31, 2001, Cablecom provided cable modem services to 67,000 subscribers.

     In its franchise areas, Cablecom offers both residential customers and
businesses Internet access services connecting users to SwissOnline's portal via
Cablecom's network, and thus retain all usage related revenues for dial-up
services and all access revenues for all types of subscription-based Internet
services such as pay dial-up and high-speed Internet services.

     TELECOMMUNICATION SERVICES.  Apart from Swisscom, Cablecom is the only
company with a nationwide footprint and a local loop infrastructure. Cablecom
expects to be able to provide broadband local loop infrastructure access to
nearly 50% of Swiss households. Cablecom's local loop networks cover all major
Swiss cities, except Lausanne and Geneva, where Cablecom has a 12.2% stake in
022 Telegeneve, a company which provides such coverage.

     In December 2001, lab testing and field trials of the Cablecom VoIP
telephony product proved successful. Cablecom plans the commercial launch of its
telephony product in mid-2002.

  IRELAND

     In July 1999, we acquired Cablelink Ltd. in the Republic of Ireland, which
then had over 400,000 franchise homes in Dublin, Galway and Waterford.

     This company provides cable television services in Dublin, Galway and
Waterford to over 370,000 subscribers. As of December 31, 2001, the company had
an 83.4% penetration rate over its broadband cable network, which passes over
440,000 homes. The company holds licenses to provide analog and digital
television services in its franchises for the next 12 years with exclusive
rights for the next two years. It also has a full service license allowing it to
provide public telephony, Internet and other value-added services throughout
Ireland.

     Among our 2001 highlights, Cablelink:

     - developed and successfully rolled out our digital television service in
       Dublin, Galway and Waterford;

     - met all of our regulatory milestones for the provision of digital
       television;

     - integrated our residential and business to business divisions in Ireland
       to create a single operating entity -- thus deriving extra operational
       efficiencies and synergies;

     - migrated 95% of our customer base onto a new customer relationship
       management system; and

     - made all systems fully Euro compliant for the introduction of the Euro.
                                        19
<PAGE>

  FRANCE

  1G Networks and Noos S.A.

     We acquired France Telecom's 1G Networks in two steps in August 1999 and
December 1999. Pursuant to our purchase agreement, we held exclusive licenses to
provide analog and digital television services over 1G Networks. 1G Networks has
launched a pilot version of its digital platform, increasing the number of
channels available to customers as well as providing high-speed Internet access.

     On August 7, 2000, we announced that we had signed an agreement in
partnership with Morgan Stanley Dean Witter Private Equity to purchase France
Telecom's 49.9% stake in Noos S.A. We closed the transaction in May 2001 and
acquired 27% of Noos for approximately $594 million in liquidation preference of
our preferred stock, based on an enterprise value of Noos of Euro 2.7 billion
($2.45 billion). In November 2001, to capitalize on network synergies and
customer proximity, we merged our 1G operations in France with Noos.

     The combined Noos/1G is the market leading French broadband company,
offering analog and digital cable television, high-speed Internet and telephony
services to a total of 939,000 customers as of December 31, 2001. As of December
31, 2001, its network passed 2,811,000 homes and businesses. As of December 31,
2001 there were an estimated 3,447,000 homes and businesses in Noos's and 1G's
combined franchise areas. Noos currently provides high-speed Internet access to
over 92,000 homes and businesses in France.

     Noos operates a fully digital hybrid fiber coaxial network comprising over
16,000 km of coaxial and approximately 4,000 km of fiber cable. This network
provides Noos with a unique platform to implement a broadband strategy in
France. In addition, Noos has secured long term access rights to underground
ducts for future network upgrade.

     Our investment in Noos provides us access to metropolitan Paris and
Strasbourg and other major cities in France. Noos offers significant
efficiencies with our core business of bundled digital cable television, high
speed Internet and telephony services.

  GERMANY

  iesy Hessen GmbH (formerly eKabel Hessen GmbH)

     In August 2000, we completed a 50% investment in eKabel Investco, which
owns 65% of iesy Holdings GmbH, the Hessen cable network in Germany. iesy Hessen
GmbH owns and operates the largest cable television network in the German
province of Hessen, which includes Frankfurt, the second largest financial
center in Europe. iesy currently broadcasts up to 33 analog channels, 13 digital
channels and 36 radio channels.

     There are approximately 2.8 million homes in Hessen, of which 66% or 1.8
million homes were passed by iesy's network as of December 31, 2001. Of the 1.8
million homes passed, 72%, or 1.3 million homes, are connected to iesy's
network. For the year ended December 31, 2001, iesy Hessen GmbH generated a
total revenue of Euro 115.8 million. iesy has a historical annual churn rate of
less than 6%, which compares favorably to other European and U.S. cable
providers. This loyalty of its customer base provides a solid platform on which
to offer iesy branded products, such as "iesynet" and "iesyphone."

     In October 2001, iesy successfully completed network upgrade technology
trials. iesy is currently upgrading its network and expects to upgrade 300,000
homes in 2002. The network upgrade plan will focus first on areas which offer
attractive demographics for return on iesy's investment. This upgraded network
will allow iesy to offer a wider array of broadband products and services,
including the "triple-play" of digital cable television, high-speed Internet and
telephony services.

     iesy's high speed Internet product, iesynet, has seen high demand in a
pilot program in Frankfurt. Commercial launch of iesynet is targeted for
mid-2002. Also in 2001, iesy was granted a class 4 voice telephony
telecommunications license, and expects to offer VoIP telephony over its network
in 2003.

                                        20
<PAGE>

  SWEDEN

  Bredbandsbolaget ("B2")

     As a result of a series of transactions from March 2000 through September
2001, we have acquired a 34% interest in B2. B2 is a rapidly growing broadband
communications company providing 10 Mb/s network access and broadband services
to residential and small-to-medium business customers. In 2001, B2 concentrated
its efforts on rapidly growing the business in Sweden by stopping its expansion
efforts in Norway and Denmark. During 2001, B2 reduced the number of its
permanent and temporary employees from approximately 600 to 210 people, and grew
its subscriber base from 18,700 to over 69,700 customers. In September 2001, B2
raised SEK 2.4 Billion ($224 million) in a private placement.

     B2 provides "always on," low-cost access to a high-capacity broadband
network that provides transmission, both to and from the customer, at the same
speed and at the same time. B2's 10 Mb/s network access speed is substantially
faster than typical connections offered by existing cable television and
telecommunications operators and is upgradeable to 100 Mb/s without significant
expense. In addition to broadband access, B2 intends to provide telephony and
video access to its customers through a personalized, interactive interface.
Similar to Cablecom and iesy, B2 has already successfully tested its VoIP
telephony product.

     The following table illustrates our holdings in Western Europe, including
that in the UK:

           WESTERN EUROPE CUSTOMER STATISTICS AS OF DECEMBER 31, 2001

<Table>
<Caption>
                              NTL         NTL      CABLECOM      NOOS      EKABEL        B2
                              (UK)     (IRELAND)   (SWISS)     (FRANCE)   (GERMANY)   (SWEDEN)    EQUITY     GROSS
                            --------   ---------   --------    --------   ---------   --------   --------   --------
                                                        (SUBSCRIBER TOTALS IN THOUSANDS)
<S>                         <C>        <C>         <C>         <C>        <C>         <C>        <C>        <C>
RESIDENTIAL
Ownership Interest........       100%      100%        100%(1)    27.0%       32.5%     34.0%
Homes in Franchise........  11,411.2     443.8     1,902.7     3,447.0     2,800.0     299.0     15,513.4   20,303.7
Homes passed..............   8,404.1     443.8     1,902.7     2,811.5     1,828.0     217.0     11,990.9   15,607.1
Homes marketed (Telco)....   7,506.4      20.0          --        10.0          --        --      7,529.1    7,536.4
Homes marketed (CATV).....   7,729.8     443.2     1,734.8     2,758.4     1,828.0     205.1     11,155.0   14,699.3
Customers.................   2,840.0     369.8     1,583.0       939.6     1,299.7      69.7      5,339.5    7,101.8
  Dual/Triple RGU.........   2,038.2       5.3        67.3        76.0          --        --      2,130.7    2,186.8
  Single RGU..............     801.8     364.5     1,515.7       863.6     1,299.7      69.7      3,208.8    4,915.0
Cable Television (CATV)...   2,261.9     369.8     1,583.0       920.7     1,299.7        --      4,732.7    6,435.1
  Digital.................   1,253.5       7.7        48.4       323.9          --        --      1,394.6    1,633.5
  Analog..................   1,008.4     340.6     1,534.6       238.5     1,299.7        --      3,219.9    4,421.8
  Antenna.................        --      21.5          --       358.3          --        --        118.2      379.8
Telephone.................   2,589.3       5.3          --         2.2          --        --      2,595.2    2,596.8
Internet (INT)............     845.0       1.5       228.3        92.5          --      69.7      1,122.9    1,237.0
  Dial-Up (ntlworld and
    other)................     698.4       1.4       161.0          --          --        --        860.8      860.8
  Digital TV Access.......      28.5        --          --          --          --        --         28.5       28.5
  Broadband (BB)..........     118.1       0.1        67.3        92.5          --      69.7        233.6      347.7
RGUs (CATV, Telco, BB)....   4,969.3     375.2     1,650.3     1,015.4     1,299.7      69.7      7,561.5    9,379.6
Service Units (CATV,
  Telco, Int).............   5,696.2     376.6     1,811.3     1,015.4     1,299.7      69.7      8,450.8   10,268.9
RGUs/Customer.............      1.75x     1.01x       1.04x       1.08x       1.00x     1.00x        1.42x      1.32x
Service Units/Customer....      2.01x     1.02x       1.14x       1.08x       1.00x     1.00x        1.58x      1.45x
Penetration:
  CATV....................      29.3%     83.4%       91.2%       33.4%       71.1%      0.0%        42.4%      43.8%
  Telephone...............      34.5%     26.5%         --        22.0%         --        --         34.5%      34.5%
  Customer................      36.7%     83.4%       91.2%       34.1%       71.1%     34.0%        47.9%      48.3%
  RGU.....................      64.3%     84.7%       95.1%       36.8%       71.1%     34.0%        67.8%      63.8%
  Service Unit............      73.7%     85.0%      104.4%       36.8%       71.1%     34.0%        75.8%      69.9%
  Dual/Triple.............      71.8%      1.4%        4.3%        8.1%        0.0%      0.0%        39.9%      30.8%
</Table>

                                        21
<PAGE>

<Table>
<Caption>
                              NTL         NTL      CABLECOM      NOOS      EKABEL        B2
                              (UK)     (IRELAND)   (SWISS)     (FRANCE)   (GERMANY)   (SWEDEN)    EQUITY     GROSS
                            --------   ---------   --------    --------   ---------   --------   --------   --------
                                                        (SUBSCRIBER TOTALS IN THOUSANDS)
<S>                         <C>        <C>         <C>         <C>        <C>         <C>        <C>        <C>
Quarterly Growth:
  Customers...............     (41.8)     (4.8)        2.9        44.6         5.7      19.2        (24.5)      25.8
  RGUs....................     (51.5)     (5.8)       15.4        51.7         5.7      19.2        (20.5)      34.7
Off-Net Telephony.........     118.3       2.8          --          --          --        --        121.1      121.1
  Telephone...............      29.1        --          --          --          --        --         29.1       29.1
  Telephone and
    Internet..............      89.2       2.8          --          --          --        --         92.0       92.0
BUSINESS DIVISION
Business Customers........      76.2       0.2         4.3        35.6          --        --         90.3      116.3
Business Lines............     389.7       1.9          --          --          --        --        391.6      391.6
Wholesale Internet
  Subscribers.............   1,210.7       0.2          --          --          --        --      1,210.9    1,210.9
Total Customers...........   4,245.2     373.0     1,587.3       975.2     1,299.7      69.7      6,761.8    8,550.1
Total Service Units.......   7,504.1     384.3     1,811.3     1,015.4     1,299.7      69.7     10,266.4   12,084.5
</Table>

---------------
(1) Cablecom has equity interests in 28 cable systems in Switzerland. The
    following statistics reflect the proportional operating data in which
    Cablecom does not maintain an equity interest: 186,700 homes passed, 161,400
    homes marketed, 153,100 subscribers, 600 broadband Internet subscribers and
    153,600 RGUs.

COMPETITION

     We face significant competition from established and new competitors in the
areas of residential telephony, business telecommunications services, Internet
and cable television.

  CONSUMER SERVICES

     We compete primarily with BT in providing telephone services to residential
customers in the UK. BT occupies an established market position and manages
fully built networks and has resources substantially greater than ours.
According to the Office of Telecommunications, or OFTEL, in September 2001, BT
serviced 81.29% of UK residential telephone exchange line customers. Our growth
in telecommunications services, therefore, depends upon our ability to convince
BT's customers to switch to our telecommunications services. We believe that
value for money is currently one of the most important factors influencing the
decision of UK customers to switch from BT to a competing telecommunications
service. BT has, however, introduced price reductions in some categories of
calls and, due to regulatory price controls, BT will be making further
reductions in its telecommunications prices. Accordingly, although we intend to
remain competitive, in the future we may be unable to offer residential
telephone services at rates lower than those offered by BT. In this case, we may
not achieve desired penetration rates and may experience a decline in total
revenues. There can be no assurance that any such decline in revenues or
penetration rates will not adversely affect us. In addition to BT, other
telecommunications competitors could prevent us from increasing our share of the
residential telecommunications market. In particular, carrier pre-selection for
all calls (except for some special categories) was launched in 2001 which may
increase the appeal of indirect access operators, whose discounted call charges
may undercut us.

     We also compete with mobile networks. This technology may grow to become a
competitive threat to our networks, particularly if call charges are reduced
further on the mobile networks. Our tower services group may enable us to
benefit from the growth in this technology. There can be no assurance, however,
that we will be able to compete successfully with such telecommunications
operators.

     We believe that we have a competitive advantage in the residential market
because we offer integrated telephone, cable television, telecommunications
services (including Internet, interactive and on-line services) and
multi-product packages designed to encourage customers to subscribe to multiple
services. The packages we currently offer to our UK residential franchise
customers (excluding customers in Milton Keynes and Westminster, where we plan
to launch broadband in 2002, and in some former Cable & Wireless Communications
franchises which only offer cable television) comprise telephone service,
narrowband

                                        22
<PAGE>

Internet access service, broadband Internet access services, all of the current
terrestrial television channels and access to multi-channel television,
including pay per view and interactive television services. Our packaging and
pricing are designed to encourage our customers to use multiple services such as
dual telephone and broadband, dual telephone and narrowband, dual telephone and
TV, or triple telephone, TV and Internet access. Of our competitors, only
Telewest, which does not offer its services in our franchise areas, is able to
offer the full range of services we provide. However, there can be no assurance
that this competitive advantage will continue. Indeed, BT and all other
operators have been permitted to provide and convey cable television services
throughout the UK from January 1, 2001, and exclusive franchises will no longer
be awarded.

     British Sky Broadcasting Limited, or BSkyB, currently markets
telecommunications services on an indirect access basis, which requires the
customer to dial additional digits before entering the primary telephone number,
thus diverting calls onto another operator's network.

     Our cable television systems compete with direct reception over-the-air
terrestrial broadcast television, DTH satellite services (i.e., BSkyB) and
satellite master antenna systems. In addition, pay television and pay-per-view
services offered by us compete to varying degrees with other communications and
entertainment media, including home video, cinema exhibition of feature films,
live theater and newly emerging multimedia services. We expect that, in the
future, we may face competition from programming provided by video-on-demand
services.

     We offer our broadband Internet service at flat rates of L14.99 and L24.99
per month for 128Kb/s and 512Kb/s, respectively, including the rental of a cable
modem. This compares with the newly announced prices for Freeserve and
BTOpenworld 512Kb/s ADSL services of L29.99 per month plus purchase of the
modem.

  BUSINESS TELECOMMUNICATIONS

     BT and Cable & Wireless are our principal competitors in providing business
telecommunications services. In the future, we may compete with additional
entrants to the business telecommunications market. Competition is based on
price, range and quality of services, and we expect price competition to
intensify if existing and other new market entrants compete aggressively. Most
of these competitors have substantial resources and there can be no assurance
that these or other competitors will not expand their businesses in our existing
markets or that we will be able to continue to compete successfully with such
competitors in the business telecommunications market.

  BROADCAST TRANSMISSION AND TOWER SERVICES

     Crown Castle UK Ltd, a subsidiary of Crown Castle International Corp., is
NTL's primary competition in the terrestrial broadcast transmission market in
the UK. Crown provides analog transmission services to the BBC and digital
transmission services to both the BBC and ITVDigital. Crown has diversified from
its core television broadcasting business using its transmission infrastructure
to enter into the radio transmission and telecommunications sectors.

     Although Crown is our direct competitor, we each have reciprocal rights to
use each other's sites for broadcast transmission usage in order to enable each
of us to achieve the necessary country-wide coverage. This relationship is
formalized by the site-sharing agreement entered into in 1991 when those towers
were privatized.

     Crown also offers site rental on a significant number of its sites (some of
which are managed on behalf of third parties). Like us, Crown offers a full
range of site-related services to its customers, including installation and
maintenance. In November 2000, Crown entered into an agreement with BT to
deliver roof space and grounds at an initial 4,000 BT exchange sites around the
UK. We believe our towers to be at least as well situated as Crown's and that we
will be able to continue expanding our own third-party site-sharing penetration.

     All four UK mobile operators own site infrastructure and lease space to
other users. Their openness to sharing with direct competitors varies by
operator. BT Cellnet (now called mm0(2)) and Vodafone have agreed to cut site
costs by jointly developing and acquiring sites in the Scottish Highlands. BT
and Cable &
                                        23
<PAGE>

Wireless are both major site-sharing customers but also compete by leasing their
own sites to third parties. BT's position in the market is even larger when
considered in combination with its interest in mm0(2).

     Several other companies compete in the market for site rental. These
include British Gas, Racal Network Systems, Aerial Sites Plc, Relcom Aerial
Services and the Royal Automobile Club. Some companies own sites initially
developed for their own networks, while others are developing sites specifically
to exploit this market.

REGULATION

     NTL is subject to both UK and European Union competition regulations which
prohibit companies from engaging in anti-competitive behavior in violation of
these regulations. In addition as a provider of telecommunications services, NTL
is subject to the regulatory oversight of OFTEL, which regulates
telecommunications in the United Kingdom. OFTEL regulations are designed to
ensure the fair and efficient delivery of such services to customers. NTL must
be compliant with these regulations in its product offerings and in its dealings
with customers and suppliers. Failure to comply with these regulations could
result in administrative or other legal proceedings, as a result of which NTL
could be ordered to stop activities which violate the applicable regulations,
modify its behavior to comply with applicable regulations or could be subject to
fines or civil damages.

     Telecommunications service industries in the UK are governed by legislation
under the Telecommunications Act 1984, the Broadcasting Act 1990, and the
Broadcasting Act 1996. The operator of a full-service telecommunications system
in the UK requires the following two principal non-exclusive licenses:

     - a telecommunications license, granted under the Telecommunications Act by
       the Secretary of State and supervised by the Department of Trade and
       Industry, or DTI, and OFTEL, which authorizes the installation and
       operation of the telecommunications network used to provide cable
       television and cable telephone services; and

     - a cable television license granted under the Broadcasting Act and
       supervised by the Secretary of State and the Independent Television
       Commission, or ITC, which authorizes the provision of broadcasting
       services.

     Each type of license described above contains various conditions, and in
the event of the breach of such conditions, the Director General of
Telecommunications (the head of OFTEL) or the ITC, as appropriate, could issue
an enforcement order and ultimately commence proceedings to require compliance
or to revoke such licenses.

  PRICE REGULATION

     BT is currently subject to controls over the prices it may charge
customers. In particular, BT may not increase charges for certain services by
more than the amount of the percentage change in the retail price index. In
Autumn 1999, OFTEL began the process of examining what price controls, if any,
should apply to BT after 2001. In February 2001, OFTEL announced that current
retail price controls would be extended until July 2002 with a roll over
provision for a further year. In January 2002, OFTEL issued a new consultation
setting out proposals for the progressive removal of price controls along with
certain new measures to stimulate further retail competition.

     NTL is not subject to the same scrutiny and control by OFTEL of its retail
telephone prices as BT, given its non-dominant status in the market. However,
NTL is subject to prohibitions on undue preference and undue discrimination in
its cable television pricing. NTL is also required to publish its standard
prices, terms and conditions for cable television services.

  NUMBER PORTABILITY

     The European Union agreed in 1998 to a revision to the Interconnection
Directive that made it a requirement for Member States to mandate number
portability. Implementing regulations came into force on

                                        24
<PAGE>

January 19, 2000 requiring that number portability should be provided on request
to all customers switching between different operators and providers of fixed
telecommunications services. NTL has a process in place to comply with its
existing obligations and it is now in the process of negotiating more service
establishment arrangements with other operators.

  LOCAL LOOP UNBUNDLING

     In November 1999, an OFTEL policy statement mandated the unbundling of BT's
local loop to rival providers, enabling them to offer a range of higher
bandwidth services using Digital Subscriber Line (DSL) technology. On August 8,
2000, conditions in BT's license were brought into force setting out the
requirements under which BT must provide services necessary for local loop
unbundling. OFTEL published the wholesale prices for BT's unbundled local loops
on December 2000 and prices for shared access were published in 2001 although
discussions continue as to the appropriate wholesale charges. In addition, BT is
currently rolling out ADSL over its own network. ADSL will allow consumers
access to high speed information services.

     Local loop unbundling could allow NTL to increase its broadband off-net
subscriber base, although NTL is not currently pursuing this initiative. Local
loop unbundling could also increase competition for NTL as it will also allow
other providers of broadband Internet access services to provide services to
current or potential customers of NTL. A number of companies, such as Freeserve,
have started to market broadband services using BT's local loop.

     In February 2002, BT announced reductions in its wholesale charges to ISPs
(including its own tied ISP) for wholesale ADSL services. These reductions will
lead to commensurate reductions in retail rates.

  INTERCONNECTION

     NTL Group Ltd. and National Transcommunications Limited have Annex II
status giving them rights of interconnection at wholesale rates to other
operators with similar status.

  OPEN ACCESS TO CABLE INFRASTRUCTURE

     In April 2001, OFTEL issued a statement on regulated access to cable
infrastructure ("open access"). The conclusion reached by OFTEL was that no case
existed for mandating open access to cable infrastructure at that time.

  BSKYB

     In December 2000, the Office of Fair Trading (OFT) announced that it was
commencing an investigation under the UK Competition Act into BSkyB's
activities, in particular the wholesale prices offered to rival distributors of
pay television services. This investigation is ongoing. In December 2001, the
OFT announced its preliminary finding that BSkyB had been abusing its market
power through its pricing practices. The OFT also said that it was aiming to
complete the investigation into BSkyB's pricing by summer 2002.

     In addition, in February 2002, the OFT announced that it had decided not to
give a decision on whether an agreement entered into by us with BSkyB for the
carriage of programming at discounted rates, notice of which was given to the
OFT in October 2000, was anti-competitive. As a result, we have not been able to
proceed under this agreement and will not be able to do so until the OFT renders
a favorable decision. The terms of this agreement provided that the agreement
would not come into effect unless OFT approval was granted within six months of
the agreement. Although extended for a period, this deadline has now passed.
Therefore, even if the OFT approval is granted, we will not be obligated to
perform this agreement and as a result, we may negotiate a different agreement
with BSkyB or may elect not to enter into any agreement with BSkyB.

     The OFT's investigation into BSkyB's behavior continues.

                                        25
<PAGE>

  COMPETITION ACT 1998

     The Competition Act, which came into force in March 2000, introduced a
prohibition on the abuse of a dominant position and on anti-competitive
agreements and introduced third party rights, stronger investigative powers,
interim measures and effective enforcement powers (including fines of up to 10%
of UK turnover). The Competition Act enables third parties to bring enforcement
actions directly against telecommunications operators who are in breach of the
prohibitions and seek damages, rather than have to wait for the Director General
of Telecommunications to make an enforcement order.

     In February 2000, OFTEL issued specific guidance on the application of the
Competition Act in the telecommunications sector. This guidance states that
OFTEL would follow closely the general principles of competition law in its
application of the new prohibitions. In addition, the regulators must not reach
decisions which are inconsistent with EC law.

     The Competition Act, as well as OFTEL's regulations, limit the types of
agreements and arrangements NTL can enter into. For example, NTL may be
prohibited from establishing pricing arrangements or purchasing arrangements
which have the effect of reducing competition in the market or forcing companies
to behave in a certain way dictated by NTL.

  MOBILE PHONE TERMINATION CHARGES

     On December 12, 2001, OFTEL announced that it had referred to the
Competition Commission its proposal to impose a cap on the amount mobile phone
operators can charge for receiving calls on their networks. OFTEL's conclusion
was that mobile termination rates were substantially in excess of cost and that
there was little incentive for operators to reduce the charges. Accordingly,
OFTEL has proposed a charge cap on future termination rates of RPI (12)% over
four years.

     The Competition Commission investigation is expected to conclude in
December 2002.

  BROADCAST SERVICES

     A portion of our total revenue is attributable to the provision of
television and radio transmission and distribution services. In the UK, the
provision of such services is governed by the Telecommunications Act 1984 and
the Wireless Telegraphy Act 1949.

  TELECOMMUNICATIONS ACT AND BROADCASTING ACT LICENSES

     NTL's licenses contain conditions and provisions which, among other things:

     - require us to publish our charges and terms and conditions of business
       and not to show undue preference to or exercise undue discrimination
       against particular persons in the provision of certain telecommunications
       services;

     - impose on us an obligation to share our transmission sites with other
       transmission operators;

     - restrict the prices which we are allowed to charge for the provision of
       some services;

     - prohibit us from cross-subsidizing the unregulated side of our business;
       and

     - impose a requirement for separate accounts to be produced in relation to
       both the regulated and unregulated parts of our business. However, we are
       not obliged to do anything "not reasonably practicable."

  PRICE CAP REVIEW

     Our regulated business may be divided into two categories: Price Regulated
Business and Applicable Rate Business. Price Regulated Business comprises those
telecommunication services which we are obliged to provide pursuant to our
Transmission License and in respect of which price controls are imposed. Our
Applicable Rate Business comprises those telecommunications services which we
are obliged to provide but

                                        26
<PAGE>

which do not fall within the definition of Price Regulated Business. Charges for
Applicable Rate Business are agreed between us and the relevant customer. If
despite all reasonable efforts an agreement cannot be reached between us and a
significant proportion of our customers in respect of any particular
telecommunications service, the charge will be determined by the Director
General.

     In respect of any services provided by us which are not Price Regulated
Business or Applicable Rate Business, our prices are wholly unregulated, except
for the overriding duty not to engage in any pricing policy which constitutes
undue preference or undue discrimination against any person or class of persons
in respect of telecommunications services. Our unregulated income would include,
for example, charges for site rentals to PCN operators.

     Our Price Regulated Business consists of the television transmission
service provided to the ITV (Channel 3) companies and Channel 4/S4C including
the operation and maintenance of transmission equipment and the provision to
third party transmission operators of the accommodation, masts and antennae
necessary for the operation of broadcast transmission services.

     On December 24, 1996, the Director General of Telecommunications issued the
formal modification to our Telecommunications Act Licenses to effect the price
controls which are to apply to us for the period from January 1, 1997 to
December 31, 2002. The Price Cap Review had two purposes: (1) to establish a new
"P0" (allowable revenues for the first year of the next control period, 1997, in
respect of our Maximum Price Regulated Business) and (2) to establish a new "X"
(the percentage by which such revenues must, after allowing for consumer price
inflation, be reduced each year thereafter). The Director General's review
concluded that, on assumptions at the time (1996), the new P0 was (UK Pound)
53.4 million and the new X was 4.0%.

     In April 2002, OFTEL agreed with NTL an extension of the existing price
control until July 31, 2001. A review is expected to take place before the end
of 2002 to examine whether any additional price control beyond that point is
justified.

  EUROPEAN UNION LEGISLATION

     Our business is further regulated by the EU under various European
Commission Directives. In February 2002, the European Union Commission adopted a
package of legislative measures which set out a new framework for electronic
communication and ensures that the legislation is more technology neutral. The
proposed new framework consists of five harmonization Directives, including a
framework Directive and four specific Directives on authorization, access and
interconnection, universal service and users' rights, and data protection in
telecommunications services, a Regulation on unbundling the local loop, a draft
liberalization Directive and a decision on Community radio spectrum policy.

  COMMUNICATIONS BILL

     A White Paper issued in December 2000 -- A New Future for
Communications -- proposed the creation of a new body 'OFCOM' to regulate the
communications industry. This will merge the functions of, among others, OFTEL,
the Radiocommunications Agency and ITC and it is intended that it will provide a
more flexible framework for regulating a converging industry.

     Our operations in Switzerland as well as the operations of companies in
which we hold a minority interest in France, Germany and Sweden are also subject
to regulation by the governments of the countries in which they operate.

RESEARCH AND DEVELOPMENT

     Our research and development activities involve the analysis of
technological developments affecting our cable television, telephone and
telecommunications business, the evaluation of existing services and sales and
marketing techniques and the development of new services and techniques.

                                        27
<PAGE>

PATENTS, COPYRIGHTS AND LICENSES

     We do not have any material patents or copyrights nor do we believe that
patents play a material role in our business. We are substantially dependent on
the licenses and franchises granted by the legislative agencies which regulate
our respective businesses. The loss of any one or more of our licenses or
franchises could have a material adverse effect on our business and financial
condition.

CUSTOMERS

     No material part of our business is dependent upon a single customer or a
few customers, the loss of any one or more of which would have a materially
adverse effect on us. In our broadcast services business, 38.1% of revenues from
the broadcast services business was derived from contracts with the ITV
companies, Channel 4/S4C, Channel 5 in the UK, ABC and SBS in Australia in 2001.

EMPLOYEES

     At December 31, 2001, we had approximately 19,200 employees, approximately
16,900 of whom are permanent and approximately 2,300 of whom are temporary or
contract employees. We believe that our relationship with our employees is good.

ITEM 2.  PROPERTIES

UK AND IRELAND

     In the UK and Ireland, we own, lease or occupy under license 126 business
unit and regional offices, our corporate head offices in each of Hook and
Dublin, and 9 retail shops. In addition, we own or lease approximately 655
switching centers/head-ends and operational hub-sites together with warehouses
and other non-operational properties, as well as various cable television,
telephone and telecommunications equipment housed on public and private sites.

     In addition, in the UK, for the purposes of our site leasing and broadcast
transmission businesses, we own, lease, contract to lease, or occupy under
license approximately 1,370 properties. For these businesses, we also are the
licensee of approximately 680 transmitter sites which are owned by Castle
Transmission and shared between the two organizations pursuant to a site sharing
agreement.

SWITZERLAND

     In Switzerland, we own or lease 51 offices, our corporate head-offices in
Zurich, and 43 retail shops. In addition, we own or lease approximately 450
network sites together with warehouses and other non-operational properties, as
well as various cable television, telephone and telecommunications equipment
housed on public and private sites.

OTHER

     We maintain offices under lease for our corporate staff in New York City,
as well as offices for our ntl: broadcast staff based in the Far East. We
believe that our facilities are presently adequate for their current use.

ITEM 3.  LEGAL PROCEEDINGS

     We are involved in, or have been involved in, certain disputes and
litigation arising in the ordinary course of business, including claims
involving contractual disputes and claims for damages to property and personal
injury resulting from the construction of our networks and the maintenance and
servicing of our transmission masts, none of which are expected to have a
material adverse effect on our financial position or results of operations or
cash flows.

                                        28
<PAGE>

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters that were submitted to a vote of NTL stockholders
during the quarter ended December 31, 2001.

                                    PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

     On March 28, 2002, the New York Stock Exchange announced that it was
suspending our common stock from trading on the NYSE and that it intended to
apply to the SEC to delist our common stock following this suspension. This
determination was based upon, among other things, the selling price for our
common stock, which closed at $0.20 on March 26, 2002. The continued listing
standards of the NYSE require maintenance of a minimum share price of $1 over a
30 trading day period and average global market capitalization of $100 million
over a 30 trading day period. Our common stock fell below both of these
continued listing standards. We have a right to a review of the NYSE staff's
decision in a hearing before a Committee of the Board of Directors of the NYSE.
We are pursuing that right but there can be no assurance that we will be
successful. Our common stock is currently quoted on the Over the Counter
Bulletin Board under the symbol "NTLD" and continues to trade on NASDAQ EUROPE
under the symbol "NTLI".

     On October 27, 2000, our common stock began trading on the New York Stock
Exchange under the symbol "NLI". Concurrently with the NYSE listing, we withdrew
our listing on the Nasdaq Stock Market's National Market where our common stock
had been trading under the symbol "NTLI". The following table sets forth, for
the periods indicated, the high and low last sale prices as reported on the
Nasdaq Stock Market's National Market until October 26, 2000 and on the NYSE
until March 26, 2002. The information set forth below gives retroactive effect
to the 5-for-4 stock split in February 2000.

<Table>
<Caption>
                                                              LAST SALE PRICE
                                                              ----------------
                                                               HIGH      LOW
                                                              -------   ------
<S>                                                           <C>       <C>
2000
  First Quarter.............................................  $109.10   $82.00
  Second Quarter............................................    91.50    53.00
  Third Quarter.............................................    59.88    39.19
  Fourth Quarter............................................    49.25    21.81
2001
  First Quarter.............................................    39.20    22.75
  Second Quarter............................................    32.40    11.69
  Third Quarter.............................................    13.79     2.00
  Fourth Quarter............................................     4.55     0.62
2002
  First Quarter (through March 26, 2002)....................     0.98     0.17
</Table>

     On March 26, 2002, the closing sale price for our common stock, as reported
on the NYSE was $0.20. As of March 26, 2002, there were 5,693 record holders of
our common stock. This figure does not reflect beneficial ownership of shares
held in nominee name.

     We have never paid cash dividends on our common stock. Currently, we do not
have available surplus under Delaware law. Under Delaware law, a Delaware
corporation cannot, among other things, pay dividends on its capital stock
unless it has available surplus. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Liquidity and Capital
Resources". In addition, the certificates of designation governing our preferred
stock limit our ability to pay dividends on our equity securities and there are
legal and contractual restrictions on the ability of our subsidiaries to
transfer funds to us in the form of cash dividends, loans or advances, including
those contained in our subsidiaries' indentures and credit agreements. We do not
currently anticipate paying cash dividends in the foreseeable future on shares
of our capital stock.

                                        29
<PAGE>

We anticipate that for the foreseeable future any cash flow generated from our
subsidiaries' operations will be used for debt service. Any future determination
as to the payment of dividends will be at the discretion of our Board of
Directors and will depend upon our operating results, financial condition and
capital requirements, indenture and other contractual restrictions, general
business conditions and such other factors as our Board of Directors deems
relevant. There can be no assurance that we will pay dividends at any time in
the future.

SALES OF UNREGISTERED SECURITIES

     In addition to the issuance on May 18, 2001 of 47,218 shares of our
Variable Coupon Redeemable Preferred Stock, Series A and 12,194 shares of 6.5%
Fixed Coupon Redeemable Preferred Stock to France Telecom in exchange for a 27%
interest in Noos, we issued the following unregistered securities:

          In June 2001, in reliance on the exemption from registration provided
     by Section 4(2) of the Securities Act, the Company and NTL (Delaware),
     Inc., as co-issuers, issued $100.0 million aggregate principal amount of
     5 3/4% Convertible Subordinated Notes due June 22, 2011 to GE Capital and
     received proceeds of approximately $95.9 million. Interest is payable
     quarterly in cash at a rate of 5 3/4% per annum beginning on October 15,
     2001. These notes are convertible into shares of our common stock at the
     option of the holder at an initial conversion price of $35.00 per share,
     subject to adjustment. After December 22, 2007, the notes are redeemable,
     in whole or from time to time in part, at NTL (Delaware), Inc.'s or our
     option. Proceeds raised from the issuance were used to reduce commitments
     under the UK working capital facility, finance construction, capital
     expenditure, working capital requirements and for general corporate
     purposes.

          In May 2001, in reliance on the exemptions from registration provided
     by Section 4(2) and Rule 144A of the Securities Act, NTL Communications,
     our wholly owned indirect subsidiary, issued $1,150.0 million aggregate
     principal amount of 6 3/4% Convertible Senior Notes due May 15, 2008 to
     qualified institutional buyers. NTL Communications received proceeds of
     approximately $1,114.8 million after placement agents' commissions and
     other fees. Interest is payable semiannually in cash at a rate of 6 3/4%
     per annum beginning on November 15, 2001. These notes are convertible into
     shares of our common stock at the option of the holder after August 13,
     2001 at a conversion price of $32.728 per share. After May 20, 2004, the
     notes are redeemable, in whole or from time to time in part, at NTL
     Communications' and our option. We are a co-obligor of the notes on a
     subordinated basis. Proceeds raised from the issuance were used to reduce
     commitments under the UK working capital facility, finance construction,
     capital expenditure, working capital requirements and for general corporate
     purposes.

          On September 12, 2001, in reliance on the exemption from registration
     provided by Section 3(a)(9) of the Securities Act, we issued 1,850,000
     shares of our Cumulative Convertible Preferred Stock, Series A in exchange
     for the 1,850,000 issued and outstanding shares of our 5% Cumulative
     Preferred Stock held by France Telecom and others. The Convertible
     Preferred Stock has a stated value and liquidation preference of $1,075.17
     per share and is mandatorily redeemable for cash by us on March 27, 2009.
     Dividends are payable quarterly in additional shares of Convertible
     Preferred Stock, at the following quarterly dividend rates: (i) from
     September 12, 2001 through March 26, 2002, $13.44 per share, (ii) from
     March 27, 2002 through March 26, 2003, $21.23 per share and (iii) from
     March 27, 2003 through March 26, 2004, $26.61 per share. Once the
     Convertibility Date (as defined below) is set, the quarterly dividend rate
     resets to $16.12 per share and the Convertible Preferred Stock becomes
     eligible for conversion into shares of our common stock beginning on a
     "Convertibility Date," at which time the conversion price is set at 125% of
     the immediately preceding 25 trading day volume-weighted average price of
     our common stock (the "Convertibility Base Price"). The Convertibility Date
     is as follows: March 27, 2002, unless we elect to delay convertibility
     until March 27, 2003 or, alternatively, redeem, at our option, all shares
     of the Convertible Preferred Stock on March 27, 2002 in cash; if we have
     delayed, March 27, 2003, unless we elect again to delay convertibility
     until March 27, 2004, which we may only do if the Convertibility Base Price
     would be less than or equal to $65.00 per share (as may be adjusted for
     certain dilutive events); we may also elect, instead, to redeem all shares
     of the Convertible Preferred Stock on March 27, 2003 in cash; if we have
     delayed, March 27, 2004, unless we elect to redeem all shares of the
     Convertible Preferred Stock on March 27, 2004 in cash. In no event will the
                                        30
<PAGE>

     Convertibility Date be after March 27, 2004. We elected in March 2002 to
     delay convertibility until at least March 27, 2003. Holders of Convertible
     Preferred Stock other than any commercial bank or their affiliates may at
     any time elect, subject to some conditions, to exchange their Convertible
     Preferred Stock for up to 50% interest in an entity holding our Swiss
     operations.

ITEM 6.  SELECTED FINANCIAL DATA

     The following table sets forth certain financial data for the years ended
December 31, 2001, 2000, 1999, 1998 and 1997. This information should be read in
conjunction with the consolidated financial statements and notes thereto
appearing elsewhere in this Form 10-K/A.

<Table>
<Caption>
                                                     YEAR ENDED DECEMBER 31,
                                     --------------------------------------------------------
                                      2001(1)      2000(2)     1999(3)    1998(4)      1997
                                     ----------   ---------   ---------   --------   --------
                                               (IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                  <C>          <C>         <C>         <C>        <C>
Income statement data:
  Operating revenues...............  $  3,699.2   $ 2,840.8   $ 1,584.1   $  747.0   $  491.8
  (Loss) before extraordinary
     item..........................   (14,241.3)   (2,963.7)     (732.7)    (503.9)    (328.6)
  Net (loss).......................   (14,241.3)   (2,963.7)     (735.7)    (534.6)    (333.1)
  Basic and diluted net (loss) per
     common share:
  (Loss) per common share before
     extraordinary item(5).........      (52.78)     (14.54)      (6.75)     (8.12)     (6.79)
  Net (loss) per common share(5)...      (52.78)     (14.54)      (6.78)     (8.60)     (6.88)
  Weighted average number of common
     shares used in the computation
     of basic and diluted net loss
     per common share(5)...........       276.0       217.1       119.4       64.4       50.2
</Table>

<Table>
<Caption>
                                                        AS OF DECEMBER 31,
                                     --------------------------------------------------------
                                      2001(1)      2000(2)     1999(3)    1998(4)      1997
                                     ----------   ---------   ---------   --------   --------
<S>                                  <C>          <C>         <C>         <C>        <C>
Working capital (deficiency).......  $(18,510.6)  $  (849.1)  $ 2,261.4   $  600.5   $  (52.3)
Fixed assets, net..................    12,573.3    12,693.0     5,597.7    3,854.4    1,757.0
Total assets.......................    16,834.2    28,383.7    12,211.6    6,194.1    2,421.6
Long-term debt.....................       102.3    15,044.1     8,798.0    5,043.8    2,015.1
Redeemable preferred stock.........     2,773.7     2,083.2       141.8      124.1      108.5
Shareholders' equity
  (deficiency).....................    (6,542.4)    8,367.4     2,136.9      355.2      (61.7)
</Table>

---------------

(1) As of December 31, 2001, primarily all of the Company's debt has been
    classified as current due to the uncertainties about compliance with the
    terms and conditions of the Company's debt that would give the holders of
    the debt the right to accelerate payment. In the fourth quarter of 2001, the
    Company recorded asset impairments totaling $9,511.3 million including
    goodwill of $8,840.5 million, license acquisition costs of $58.8 million,
    customer lists of $9.1 million, other intangibles of $14.9 million,
    investments in affiliates of $463.7 million and other assets of $124.3
    million. In addition, in 2001, the Company recorded restructuring costs of
    $209.6 million, integration and consulting costs of $102.1 million and
    losses on the 1G transaction and the sale of the ConsumerCo off-net indirect
    access customers of $147.4 million.

(2) In March 2000, the Company purchased Cablecom for an aggregate purchase
    price of $3,528.7 million, including intangibles of $2,355.3 million. In May
    2000, the Company purchased ConsumerCo for an aggregate purchase price of
    $13,111.0 million, including intangibles of $8,879.0 million. The net assets
    and results of operations of Cablecom and ConsumerCo are included in the
    consolidated financial statements from their respective dates of
    acquisition.

(3) In March 1999, the Company purchased Diamond for an aggregate purchase price
    of $984.6 million, including intangibles aggregating $1,323.0 million. In
    April 1999, the Company purchased the Australian

                                        31
<PAGE>

    National Transmission Network for an aggregate purchase price of $425.8
    million, including intangibles of $220.6 million. In July 1999, the Company
    acquired Cablelink for an aggregate purchase price of $700.5 million,
    including intangibles of $669.6 million. In August and December 1999, the
    Company acquired the 1G Networks of France Telecom for an aggregate purchase
    price of $61.9 million, including intangibles of $64.7 million. In September
    1999, the Company acquired the shares of Workplace Technologies plc, for an
    aggregate purchase price of $175.0 million, including intangibles of $176.9
    million. The net assets and results of operations of Diamond, the Australia
    National Transmission Network, Cablelink, the 1G Networks and Workplace
    Technologies are included in the consolidated financial statements from
    their respective dates of acquisition.

(4) In June and September 1998, the Company purchased ComTel for an aggregate
    purchase price of $969 million, including intangibles aggregating $224
    million. In October 1998, the Company purchased Comcast UK for an aggregate
    purchase price of $600 million, including intangibles of $130 million. In
    December 1998, the Company purchased EGT for an aggregate purchase price of
    $151 million, including intangibles of $45 million. The net assets and
    results of operations of ComTel, Comcast UK and EGT are included in the
    consolidated financial statements from their respective dates of
    acquisition.

(5) After giving retroactive effect to the five-for-four stock split by way of
    stock dividend paid in October 1999 and the five-for-four stock split by way
    of stock dividend paid in February 2000.

     The Company did not declare or pay any cash dividends during the years
indicated.

                                        32
<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

  RECAPITALIZATION PROCESS AND ABILITY TO CONTINUE OPERATIONS

     The Company historically incurred operating losses and negative operating
cash flow. In addition, the Company required significant amounts of capital to
finance construction of its networks, connection of customers to the networks,
other capital expenditures and for working capital needs including debt service
requirements. The Company historically met these liquidity requirements through
cash flow from operations, amounts available under its credit facilities, vendor
financing and issuances of high-yield debt securities and convertible debt
securities in the capital markets and convertible preferred stock and common
stock to strategic investors. Both the equity and debt capital markets have
recently experienced periods of significant volatility, particularly for
securities issued by telecommunications and technology companies. The ability of
telecommunications companies to access those markets as well as their ability to
obtain financing provided by bank lenders and equipment suppliers has become
more restricted and financing costs have increased. During some recent periods,
the capital markets have been largely unavailable to new issues of securities by
telecommunications companies. The Company's public equity is no longer trading
on the New York Stock Exchange, and its debt securities are trading at or near
all time lows. These factors, together with the Company's substantial leverage,
means the Company does not currently have access to its historic sources of
capital.

     In addition, the Company's UK credit facilities are fully drawn and the
Company's Swiss subsidiaries are currently unable to draw the remaining undrawn
amounts under the Cablecom credit facility. NTL Communications Corp., a
wholly-owned indirect subsidiary of the Company, did not pay cash interest on
certain series of its notes that was due on April 1, 2002 and April 15, 2002.
NTL Incorporated and NTL (Delaware), Inc. also did not pay cash interest and
related fees on a series of their notes that was due on April 15, 2002. As of
December 31, 2001, the Company had approximately $505 million in cash and cash
equivalents on hand and, on April 4, 2002, received approximately $303 million
net cash proceeds from the sale of its Australian business. The Company will
require cash for working capital and capital expenditures in 2002. If the
Company and its subsidiaries make scheduled and overdue interest payments on
their notes, then the Company will not have sufficient cash resources to meet
its liquidity needs through the third quarter of 2002.

     As of December 31, 2001, $17,666.1 million of the Company's $17,768.4
million of long-term debt had been classified as current due to the
uncertainties about compliance with the terms and conditions of the Company's
debt that would give the holders of the debt the right to accelerate payment.

     These liquidity concerns raise substantial doubt about the Company's
ability to continue as a going concern. As a consequence, the Company needs to
restructure its outstanding debt and/or raise new funds through the issuance of
equity or additional debt.

     On January 31, 2002 we announced that we had appointed Credit Suisse First
Boston, JP Morgan and Morgan Stanley to advise on strategic and recapitalization
alternatives to strengthen our balance sheet and reduce debt and put an
appropriate capital structure in place for our business. Since then, we have
been evaluating various recapitalization alternatives to effect a comprehensive
consensual reorganization in a timely manner to minimize negative effects on our
business operations.

     On April 16, 2002 the Company announced that the Company and an unofficial
committee of its public bondholders had reached an agreement in principle on a
comprehensive recapitalization of the Company. The members of the committee hold
in the aggregate over 50% of the face value of NTL and its subsidiaries' public
bonds. The recapitalization would result in a conversion of approximately $10.6
billion in debt into equity.

     During the recapitalization process, it is anticipated that NTL's
operations will continue uninterrupted, customer service will be unaffected,
suppliers will be paid in the ordinary course and NTL's management will remain
in place.

                                        33
<PAGE>

     To implement the proposed recapitalization, NTL Incorporated, NTL
(Delaware), Inc., NTL Communications Corp., Diamond Cable Communications Limited
and Diamond Holdings Limited would file a pre-negotiated recapitalization plan
in a Chapter 11 case under the U.S. Bankruptcy Code. NTL's operating
subsidiaries would not be included in the Chapter 11 filing. The agreement in
principle is subject to various conditions, including mutually acceptable terms
with the Company's bank lenders. The recapitalization transaction contemplates
that the bank debt will remain in place as part of the recapitalization.

     To facilitate the recapitalization, certain members of the unofficial
committee of bondholders would commit to provide up to $500 million of new debt
financing to the Company's UK and Ireland operations during the Chapter 11
process and for the post-recapitalized Company. The new financing will ensure
that the Company's business operations have access to sufficient liquidity to
continue ordinary operations.

     Under the agreement in principle, NTL would be split into two companies,
one tentatively called NTL UK and Ireland and holding all of its UK and Ireland
assets, and one tentatively called NTL Euroco and holding certain of its
continental European and other assets.

     Holders of notes of NTL Incorporated, NTL (Delaware), Inc., NTL
Communications Corp. and Diamond Cable Communications Limited would in the
aggregate receive 100% of the initial common stock of NTL UK and Ireland and
approximately 86.5% of the initial common stock of NTL Euroco. NTL (Delaware),
Inc. bondholders would have the option to reinvest all or a portion of NTL
(Delaware), Inc. cash in additional shares of NTL common stock, or to receive
such cash in the recapitalization. Notes of the Company's subsidiaries Diamond
Holdings Limited and NTL (Triangle) LLC would remain outstanding and will be
kept current in interest payments. Current preferred and common stockholders,
including France Telecom, would participate in a package of rights (to be priced
at a $10.5 billion enterprise value) and warrants entitling them to purchase
primary common stock of NTL UK and Ireland at the consummation of the proposed
plan, in the case of the rights, and for the duration of the eight-year warrants
at prescribed prices. If fully exercised, those rights and warrants would
entitle the current preferred stockholders to acquire approximately 23.6% and
the current common stockholders to acquire approximately 8.9% of the entity's
primary common stock.

     Current preferred stockholders other than France Telecom, would receive
approximately 3.2% and current common stockholders, other than France Telecom,
would receive approximately 10.3% of the primary equity of NTL Euroco. It is
contemplated that, subject to the consummation of the recapitalization, France
Telecom would also receive our 27% interest in Noos, pursuant to a pledge of
such interests to France Telecom given at the time of its acquisition.

     During the recapitalization process, the Company has maintained normal and
regular trade terms with its suppliers and customers. There can be no assurance
that the Company's suppliers will continue to provide normal trade credit or
credit on acceptable terms, if at all, or that customers will continue to do
business or enter into new business with the Company. See also "Risk Factors"
for a summary of risks related to the Company's business in general and the
recapitalization process in particular.

     The Company's ability to meet its near term funding requirements upon
consummation of the reorganization plan is dependent upon a number of factors,
including the revenue generated by its operating subsidiaries, its existing cash
balances, and its ability to draw upon an exit facility or any alternative
financing. There can be no assurance that these sources of financing will be or
will remain available. The Company will require substantial funds for general
corporate and other expenses and may require additional funds for working
capital fluctuations. Failure to achieve profitability could in the future
diminish the Company's ability to sustain operations, obtain additional required
funds, and make required payments on any indebtedness it has incurred or may
incur. The Company can provide no assurance that it will be successful in
raising additional financing if required, or if successful, that the terms of
such financing will be favorable to the Company.

     The Company currently expects that it will require approximately
$730 million to fund its working capital and capital expenditures, net of cash
from operations, in the twelve month period ending December 31, 2002 to fund the
expenditures mentioned above.

                                        34
<PAGE>

     The Company believes that cash, cash equivalents and marketable securities
on hand at March 31, 2002, the cash received from the sale of NTL Australia and
the cash expected to be available from the DIP Facility and the exit facility,
if the recapitalization is completed, will be sufficient for its and its
subsidiaries cash requirements for the twelve months ending December 31, 2002.

     Over the long term, the Company will continue to require cash to fund
operations, service its remaining debt and implement its strategy. In order to
fund these requirements, the Company anticipates that it will use cash flow from
operations and may also need to issue additional debt or equity securities or
may need to secure additional bank financing. Given the Company's current
financial condition, there can be no assurance that these sources of funds will
be available to us.

  BANK WAIVERS

     Before the Company could commence negotiations with the unofficial
committee of bondholders, it was necessary to obtain waivers from the lenders
under our credit facilities. Effective March 8, 2002, these lenders granted
waivers which, until March 29, 2002, provided that the commencement of
negotiations with bondholders with a view to rescheduling its debt would not
constitute an event of default under the credit facilities.

     But for the initial waivers, the commencement of negotiations with
bondholders would have been an event of default under the credit facilities. If
an event of default were to occur, it would entitle the lenders under the credit
facilities to declare the principal amount of the outstanding debt immediately
due and payable. If this right was exercised, it would result in an event of
default under all of the Company's outstanding notes, except for those issued by
Diamond Cable Communications, Diamond Holdings and NTL Triangle, entitling the
trustee or 25% of the holders of a series to accelerate the repayment of that
series of notes. We do not have sufficient cash resources to repay our
outstanding indebtedness if it is declared immediately due and payable.

     In connection with the granting of the initial waivers, the Company agreed:

     - to provide the lenders with a 13 week rolling cash flow projection
       (updated every two weeks);

     - to keep the lenders informed of, and to provide documents in connection
       with, negotiations with bondholders or strategic investors or concerning
       proposed asset dispositions;

     - not to repurchase NTL notes; and

     - not to make an exchange offer for NTL notes or enter into an agreement
       with NTL bondholders, subject to some exceptions, without the consent of
       the lenders.

     Effective March 28, 2002, the lenders under the credit facilities agreed to
amend the initial waivers. The amendments to the initial waivers extend the
duration of the initial waivers to April 30, 2002 in the case of the UK credit
facilities or May 14, 2002 in the case of the Cablecom facility, unless the
missed interest payments on April 1, 2002 are remedied or a sufficient number of
bondholders agree to forbear in respect of such non-payment, in which case, the
UK credit facilities waivers will be extended to May 14, 2002. As a condition to
the waivers continuing effectiveness, the UK lenders required NTL Delaware to
loan L90 million to NTL (UK) Group, Inc. following receipt of the proceeds from
the sale of NTL Australia. This loan is structurally senior to the outstanding
public notes issued by NTL Communications Corp. but contractually subordinated
to the UK credit facilities. In connection with the amendments to the waivers,
we affirmed the provisions of the initial waivers and in addition, we agreed,
among other things, to:

     - provide the bank lenders a timeline setting forth the steps proposed to
       be taken in connection with the recapitalization and the dates by which
       such steps are to be taken;

     - use reasonable endeavors to consider with the lenders under the Cablecom
       credit facility possible means of credit enhancement;

                                        35
<PAGE>

     - provide the lenders under the Cablecom credit facility, by April 12,
       2002, with an updated structure chart of NTL as well as a contingency
       business plan for Cablecom in the event that sufficient additional
       funding for Cablecom is not obtained; and

     - pay legal, accounting and other advisory fees of the agent or
       coordinators of the Cablecom credit facility.

     The amended waivers prevent us from making an exchange offer with respect
to our outstanding notes or from entering into an agreement with bondholders
without the consent of the lenders under each of the credit facilities. The
amended waivers also prohibit us from commencing voluntary dissolution
proceedings, including proceedings under Chapter 11 of the U.S. bankruptcy code,
without the consent of these lenders.

     As a consequence, we cannot enter into a binding agreement with the
unofficial bondholder committee or implement the proposed plan without the
consent of our bank lenders.

     Cablecom GmbH is the principal trading company of our Swiss group. There
are a number of technical defaults under the Swiss credit facility made
available to Cablecom and various of its subsidiaries. These technical defaults
consisted of the following, as of December 31, 2001:

          1.  The requirement that members of the Cablecom group generating at
     least 95% of the group's EBITDA should guarantee the repayment of the loan
     outstanding under the credit agreement had not been satisfied.

          2.  Three companies within the Cablecom group had merged in
     contravention of restrictions in the credit agreement.

          3.  Loans had been made by members of the Cablecom group to other
     group members and to a 10% affiliate in contravention of restrictions in
     the credit agreement. A related obligation to deliver quarterly
     certificates specifying the maximum levels of intra-group loans had not
     been complied with.

          4.  The requirement to ensure that the total interest cost in respect
     of at least 40% of the loan was capped at interest rates agreed with the
     facility agent had not been complied with.

          5.  A mortgage securing a loan of CHF 600,000 from United Bank of
     Switzerland was refinanced and the benefit of the existing mortgage was
     assigned to the refinancing lender. That assignment meant the mortgage was
     no longer permitted under the credit agreement.

          6.  Four per cent of the shares in FGS Hagendorf SA were acquired by
     Cablecom, making the company a wholly owned member of the Cablecom group.
     That acquisition was not permitted under the credit agreement.

          7.  One of the security documents in favor of the banks required
     specified details of receivables to be provided to the facility agent and
     all such receivables to be paid into bank accounts assigned by way of
     security to the banks. It also required a bank account to be set up for the
     purpose of receiving certain cash payments which may have to be applied in
     prepayment of the facility. That bank account also had to be assigned by
     way of security to the banks. These obligations had not been complied with.

          8.  The following obligations imposed by the share pledges executed by
     various Cablecom group members in favour of the banks had not been
     satisfied:

             (i) the delivery of share certificates and other documents
        evidencing title in respect of certain of the pledged shares; (ii) the
        remedy of defects in certain of the pledged shares; and (iii) the
        transfer of certain nominee shares in Cablecom group companies to the
        Cablecom company which beneficially owns such shares and the delivery to
        the facility agent of copies of shareholders registers in the group
        companies updated to show the transfers.

          9.  One hundred and eighty shares in a company called Telebarn AG had
     been assigned by way of security by Cablecom to the banks notwithstanding
     the terms of a trust agreement under which Cablecom held those shares. That
     constituted a misrepresentation under the finance documents.

                                        36
<PAGE>

     In addition, as of December 31, 2001, Cablecom's and various of its
subsidiaries' liabilities exceeded their respective assets. As a consequence,
under Swiss law, those entities were deemed to be "overindebted".

     In order to try and resolve the problems caused by the overindebtedness of
its subsidiaries Cablecom GmbH had guaranteed the liabilities of some of those
subsidiaries and had agreed that intra-group debt owed to it by some of those
subsidiaries should be subordinated to the debt owed by such subsidiaries to all
of their other creditors. This also constituted an event of default under the
Cablecom credit facility which entitles the lenders to accelerate repayment.
Such an acceleration would result in an event of default under NTL
Incorporated's and NTL Delaware's 5.75% convertible subordinated notes due 2011
and 5.75% convertible subordinated notes due 2009 entitling the trustee or the
holders of 25% of each series of notes to accelerate repayment. Under Swiss law,
unless the overindebtedness is rectified those entities would be required to
commence an insolvency proceeding in Switzerland. A plan has been formulated to
rectify this overindebtedness. Implementation of this plan prior to April 30,
2002 will mean those entities will not be required to commence an insolvency
proceeding. Those proceedings would likely either be a court supervised
moratorium in which an independent administrator, or commissioner, would be
appointed to supervise the running of each company during a restructuring or, if
there is no viable restructuring plan, a bankruptcy. The commencement of those
insolvency proceedings would also constitute an immediate event of default and
acceleration of the maturity of the convertible subordinated notes referred to
above.

     We are currently in discussions with the lenders under the Swiss credit
facility regarding proposals to resolve the overindebtedness issue as well as
requesting that they waive various additional covenant breaches under the credit
facility. There can be no assurance that we will reach agreement on the
resolution of the overindebtedness issue within the time period required or
obtain the requested waivers.

  INTEREST PAYMENTS ON PUBLIC NOTES

     The Company and its subsidiaries have substantial interest payment
obligations under their existing indebtedness. NTL Communications Corp. did not
make scheduled interest payments due April 1, 2002, in the aggregate amount of
$74.2 million, in respect of its 9 1/2% notes due 2008, 11 1/2% notes due 2008
and 11 7/8% notes due 2010. In addition, NTL Communications did not make
interest payments falling due on April 15, 2002, totaling $20.2 million, in
respect of the 12 3/4% Senior Deferred Coupon Notes due 2005 and NTL
Incorporated and NTL Delaware did not make interest payments and payment of
related fees falling due on April 15, 2002 in respect of their 5 3/4%
Convertible Subordinated Notes due 2011. Those payments were not made after
consideration by the Company of requests by the unofficial bondholder committee
not to make those payments. Interest payments of $18.9 million were made, when
due, on April 2, 2002 in respect of Diamond Cable Communications 13.25% senior
discount notes due 2004. On May 15, 2002, interest totaling $94.0 million is due
on outstanding notes of NTL Triangle and NTL Communications.

     If the applicable issuer does not pay interest on these notes after a 30
day grace period expires (on April 30, 2002 in the case of the missed interest
payments due April 1, 2002), there is an event of default under the indenture in
respect of the notes on which the interest is due and unpaid. An event of
default entitles the trustee under the indenture or the holders of 25% of the
outstanding notes to declare the principal amount of those notes to be
immediately due and payable. Even if the maturity of those notes is not
accelerated after April 30, 2002, such an event of default would also result in
an event of default in respect of other debt (commonly called cross defaults)
under all of our other notes, except for those issued by NTL Triangle, Diamond
Cable Communications or Diamond Holdings. As a result, upon the expiration of
the grace period, on April 30, 2002, events of default for failure to pay
interest would occur under the relevant indentures at NTL Communications and,
contemporaneously, cross defaults would occur under the Company's other
indentures at NTL Communications, NTL Delaware, NTL Incorporated and under our
Senior Credit Facility and Working Capital Facility and could occur under the
Cablecom Facility. This would give holders of the outstanding series of debt at
these entities the right to accelerate repayment of those debts by declaring the
principal amount of the debts to be immediately due and payable unless we obtain
waivers or forbearance agreements from sufficient percentages of our creditors.
If that right to accelerate was exercised, we would not have sufficient cash
resources to repay those debts, which could ultimately lead to voluntary or
involuntary bankruptcy proceedings relating to the entities so affected. In
addition, the lenders under the Company's UK

                                        37
<PAGE>

credit facilities have security over the assets of the Company's UK operating
subsidiaries, except for the Diamond and Triangle groups of companies. In the
event that there was an event of default under those facilities, the lenders
could seek to take control of those assets under applicable UK insolvency law.

  INABILITY TO PAY DIVIDENDS ON OR REDEEM PREFERRED STOCK

     On February 4, 2002, the Company announced that it would not declare or pay
dividends on its 13% Senior Redeemable Exchangeable Preferred Stock. The Company
did not make the dividend payments due on February 15, 2002 of $6.0 million in
respect of the 13% preferred stock. In addition, the Company did not pay
dividends on its 5% cumulative participating convertible preferred stock held by
France Telecom on December 31, 2001 of $37.0 million and March 31, 2002 of $37.5
million, or on its cumulative convertible preferred stock held by France Telecom
and a group of commercial banks on December 31, 2001 of $24.9 million and March
26, 2002 of $24.1 million. Historically, payment of dividends has been made in
additional shares of preferred stock in the case of the 13% preferred stock, the
5% cumulative participating preferred stock and the cumulative convertible
preferred stock. The Company did not pay these dividends due to a lack of
available surplus under Delaware law. Under Delaware law, the Company cannot pay
dividends on or redeem its capital stock, including its preferred stock, unless
it has available surplus.

     Pursuant to the terms of the 13% preferred stock, the unpaid dividends will
continue to accrue without interest until declared and paid. Pursuant to the
terms of the 5% cumulative convertible preferred stock and the cumulative
convertible preferred stock, the unpaid dividends will continue to accrue
without interest until declared and paid, together with an additional cash
dividend on the amount so unpaid at a rate of 2% per quarter for as long as the
dividends remain unpaid. The failure to declare these dividends is not a default
under any of the Company's existing agreements. With respect to the 13%
preferred stock and 5% cumulative convertible preferred stock, if dividends
remain unpaid for six quarters, the holders of each such series shall have the
right to vote separately as a class on all matters voted on by NTL Incorporated
shareholders and shall have the right, along with other holders of preferred
stock with similar default voting rights, to elect two directors to the
Company's board.

     In addition, the lack of surplus means that the Company does not expect to
be able to redeem its Variable Coupon Redeemable Preferred Stock, Series A,
which is referred to as the Noos One Year Preferred, which is held by France
Telecom, when it becomes mandatorily redeemable, to the extent funds are
available, on May 18, 2002. If we fail to redeem the Noos preferred stock on May
18, 2002 as we expect, the holders of such Noos preferred stock will have the
right, along with other holders of preferred stock with similar default voting
rights, to elect two directors to our board and shall have the right to vote
separately as a class, on all matters brought to NTL Incorporated shareholders.

     At the time of issuance of the Noos One Year Preferred, the Company pledged
its shares of Noos to France Telecom to secure the mandatory redemption
obligation under the Noos One Year Preferred and the 6.5% Redeemable Preferred
Stock.

  CREDIT RATING DOWNGRADES

     On April 3, 2002, credit rating agency Standard & Poor's lowered the
Company's long-term corporate credit rating to D from CCC-, citing the Company's
failure to make a bond interest payment due on April 1, 2002.

  SALE OF NTL AUSTRALIA

     On April 2, 2002, the Company announced that it had completed the
previously announced sale of its Australian broadcast business to Macquarie Bank
for A$850 million (US$448 million) in an all cash transaction. The net proceeds
from the sale were approximately A$574 million (US$303 million). At that time,
the business' bank debt outstanding totaled A$227 million (US$119 million).

     On April 7, 2002, NTL Delaware loaned L90 million to NTL (UK) Group
Limited, which loan was funded by the proceeds of the sale of NTL Australia.
This loan is subordinated to the Company's UK credit

                                        38
<PAGE>

facilities. The remaining proceeds of the sale of NTL Australia remain at NTL
Delaware and it is currently anticipated that such proceeds will form a portion
of the consideration to be offered to bondholders of NTL Delaware and NTL
Incorporated in satisfaction of their claims against NTL Delaware as part of the
proposed plan of reorganization.

  DESCRIPTION OF OUTSTANDING NOTES, CREDIT FACILITIES AND REDEEMABLE PREFERRED
  STOCK

     The following summarizes the terms of the significant notes, credit
facilities and redeemable preferred stock issued by the Company and its
subsidiaries as of December 31, 2001, except for the NTL Australia bank credit
facility due to the sale of NTL Australia in April 2002.

  NTL INCORPORATED:

     (1) Senior Redeemable Exchangeable Preferred Stock due February 15, 2009,
liquidation preference of $186.8 million, dividends accrue at 13% per annum
payable quarterly in arrears, at the Company's option, until February 15, 2004,
dividends may be paid in cash, by the issuance of additional shares or in any
combination of the foregoing, redeemable at the Company's option on or after
February 15, 2002, and, on any dividend payment date, the Company may exchange
all of the outstanding shares for 13% debentures due 2009;

     (2) Convertible Preferred Stock due March 27, 2009, liquidation preference
of $2,029.1 million, dividends are payable quarterly in arrears in additional
shares, at the following quarterly dividend rates: (i) from September 12, 2001
through March 26, 2002, $13.44 per share, (ii) from March 27, 2002 through March
26, 2003, $21.23 per share, and (iii) from March 27, 2003 through March 26,
2004, $26.61 per share; once the "Convertibility Date" (which may be March 27,
2003 or March 27, 2004) is set, the quarterly dividend rate resets to $16.12 per
share and the Convertible Preferred Stock becomes eligible for conversion into
shares of the Company's common stock beginning on such Convertibility Date, at
which time the conversion price is set at 125% of the immediately preceding 25
trading day volume-weighted average price of the Company's common stock, subject
to the Company's election to delay convertibility or redeem all issued and
outstanding shares of Convertible Preferred Stock. Holders of Convertible
Preferred Stock other than any commercial bank or their affiliates may at any
time elect, subject to some conditions, to exchange their Convertible Preferred
Stock for up to a 50% interest in an entity holding our Swiss operations;

     (3) Variable Coupon Redeemable Preferred Stock, liquidation preference of
$491.7 million, dividends are payable quarterly at the Company's option in cash
or additional shares of Variable Coupon Redeemable Preferred Stock, quarterly
dividend rate based on the EURIBOR Rate plus 2.5%, quarterly dividend rate of
6.16% at December 31, 2001, mandatory redemption in cash on May 18, 2002. The
Company's 27% interest in Noos is pledged to France Telecom to secure the
mandatory redemption obligation under its Variable Coupon Redeemable Preferred
Stock and its 6.5% Fixed Coupon Redeemable Preferred Stock;

     (4) 6.5% Fixed Coupon Redeemable Preferred Stock, liquidation preference of
$126.9 million, dividends are cumulative and are payable in cash upon
redemption, mandatory redemption in cash on May 18, 2007;

     (5) 5 3/4% Convertible Subordinated Notes due June 22, 2011, principal
amount at maturity of $100.0 million, interest of 5 3/4% per annum is payable
quarterly beginning on October 15, 2001, redeemable at the option of the Company
on or after December 22, 2007, convertible into shares of the Company's common
stock at a conversion price of $35.00 per share, subject to adjustment based on
the Company's stock price and adjustment to the conversion price of some series
of our preferred stock;

  NTL DELAWARE:

     (6) 5 3/4% Convertible Subordinated Notes due December 15, 2009, principal
amount at maturity of $1,200.0 million, interest payable semiannually from June
15, 2000, redeemable at the Company's option on or after December 18, 2002,
convertible into shares of the Company's stock at a conversion price of $108.18
per share;

                                        39
<PAGE>

  NTLCL:

     (7) Working Capital Facility of L417.5 million ($607.2), all of which was
outstanding as of February 2002; originally for L1,300.0 million ($1,890.6
million); following the issuance of new debt beginning in October 2000, the
commitment has been reduced by L882.5 million ($1,283.4 million), of which
L100.0 million ($145.4 million) was outstanding as of December 31, 2001.
Interest payable at least every six months at LIBOR plus a margin rate of 5.50%
per annum, which is subject to adjustment; effective interest rate of 9.57% at
December 31, 2001; the unused portion of the commitment is subject to a
commitment fee of 0.75% payable quarterly; principal is due in full on March 31,
2006; in January and February 2002 the remaining amounts available under this
agreement were borrowed, the entire amount outstanding under the credit facility
is currently in default;

     (8) Senior Credit Facility of L2,784.8 million ($4,050.0 million), all of
which was outstanding as of December 31, 2001; originally for L2,500.0 million
($3,635.8 million), dated 30 May 2000; interest payable at least every six
months at LIBOR plus a margin rate of 2.00% per annum, which is subject to
adjustment; effective interest rate of 6.73% at December 31, 2001; the unused
portion of the commitment is subject to a commitment fee of 0.75% payable
quarterly, which is reduced to 0.50% when over 50% of the commitment is
utilized; principal is due in six quarterly installments beginning on June 30,
2004; as amended and restated pursuant to a Restatement Amendment Agreement
dated 26 September 2001 which, inter alia, amended such Senior Credit Facility
to make available a 200.0 million ($290.9 million) Term Facility (interest
payable on such Term Facility at least every six months at LIBOR plus a margin
rate of 3.50% per annum, effective interest rate of 8.06% at December 31, 2001,
principal is due in eight quarterly installments beginning on June 30, 2006) and
increase the availability of funds under the Senior Credit Facility by 84.8
million ($123.3 million), the entire amount outstanding under the credit
facility is currently in default;

  CABLECOM:

     (9) Term Loan Facility of CHF 2,700.0 million ($1,626.8 million), all of
which was outstanding as of December 31, 2001, interest payable at least every
six months at Swiss LIBOR plus a margin rate of 2.5% per annum, which is subject
to adjustment, effective interest rate of 5.27% at December 31, 2001, principal
is due over six years in quarterly installments beginning on March 31, 2004, the
entire amount outstanding under the credit Facility is currently in default;

     (10) Revolving Facility of CHF 1,400.0 million ($843.5 million), of which
CHF 875.0 million ($527.2 million) was outstanding as of December 31, 2001,
interest payable at least every six months at Swiss LIBOR plus a margin rate of
2.50% per annum, which is subject to adjustment, effective interest rate of
5.49% at December 31, 2001, the unused portion of the commitment is available
until May 2003 and is subject to a commitment fee of 0.75% payable quarterly,
which is reduced to 0.50% when over 50% of the commitment is utilized, principal
is due over six years in quarterly installments beginning on March 31, 2004; our
Swiss subsidiaries are unable to draw the remaining undrawn amounts under this
facility because, as of December 31, 2001, Cablecom's liabilities exceeded its
assets, which constituted an event of default under the facility, the entire
amount outstanding under the credit facility is currently in default;

  NTL COMMUNICATIONS:

     (11) 12 3/4% Senior Deferred Coupon Notes due April 15, 2005, principal
amount at maturity of $277.8 million, interest payable semiannually from October
15, 2000, redeemable at the Company's option on or after April 15, 2000;

     (12) 11 1/2% Senior Deferred Coupon Notes due February 1, 2006, principal
amount at maturity of $1,050.0 million, interest payable semiannually from
August 1, 2001, redeemable at the Company's option on or after February 1, 2001;

     (13) 10% Senior Notes due February 15, 2007, principal amount at maturity
of $400.0 million, interest payable semiannually from August 15, 1997,
redeemable at the Company's option on or after February 15, 2002;

                                        40
<PAGE>

     (14) 9 1/2% Senior Sterling Notes due April 1, 2008, principal amount at
maturity of L125.0 million ($181.8 million), interest payable semiannually from
October 1, 1998, redeemable at the Company's option on or after April 1, 2003;

     (15) 10 3/4% Senior Deferred Coupon Sterling Notes due April 1, 2008,
principal amount at maturity of L300.0 million ($436.3 million), interest
payable semiannually beginning on October 1, 2003, redeemable at the Company's
option on or after April 1, 2003;

     (16) 9 3/4% Senior Deferred Coupon Notes due April 1, 2008, principal
amount at maturity of $1,300.0 million, interest payable semiannually beginning
on October 1, 2003, redeemable at the Company's option on or after April 1,
2003;

     (17) 9 3/4% Senior Deferred Coupon Sterling Notes due April 15, 2009,
principal amount at maturity of L330.0 million ($479.9 million), interest
payable semiannually beginning on October 15, 2004, redeemable at the Company's
option on or after April 15, 2004;

     (18) 11 1/2% Senior Notes due October 1, 2008, principal amount at maturity
of $625.0 million, interest payable semiannually from April 1, 1999, redeemable
at the Company's option on or after October 1, 2003;

     (19) 12 3/8% Senior Deferred Coupon Notes due October 1, 2008, principal
amount at maturity of $450.0 million, interest payable semiannually beginning on
April 1, 2004, redeemable at the Company's option on or after October 1, 2003;

     (20) 7% Convertible Subordinated Notes due December 15, 2008, principal
amount at maturity of $489.8 million, interest payable semiannually from June
15, 1999, convertible into shares of the Company's common stock at a conversion
price of $39.20 per share, redeemable at the Company's option on or after
December 15, 2001;

     (21) 9 1/4% Senior Euro Notes due November 15, 2006, principal amount at
maturity of E250.0 million ($222.5 million), interest payable semiannually from
May 15, 2000;

     (22) 9 7/8% Senior Euro Notes due November 15, 2009, principal amount at
maturity of E350.0 million ($311.5 million), interest payable semiannually from
May 15, 2000, redeemable at the Company's option on or after November 15, 2004;

     (23) 11 1/2% Senior Deferred Coupon Euro Notes due November 15, 2009,
principal amount at maturity of E210.0 million ($186.9 million), interest
payable semiannually beginning on May 15, 2005, redeemable at the Company's
option on or after November 15, 2004;

     (24) 11 7/8% Senior Notes due October 1, 2010, principal amount at maturity
of $500.0 million, interest payable semiannually from April 1, 2001, redeemable
at the Company's option on or after October 1, 2005;

     (25) 12 3/8% Senior Euro Notes due February 1, 2008; principal amount at
maturity of E300.0 million ($267.0 million), interest payable semiannually from
August 1, 2001;

     (26) 6 3/4% Convertible Senior Notes due May 15, 2008, principal amount at
maturity of $1,150.0 million, interest payable semiannually from November 15,
2001, convertible into shares of the Company's common stock at a conversion
price of $32.728 per share, redeemable at the Company's option on or after May
21, 2004;

  NTL TRIANGLE:

     (27) 11.2% Senior Discount Debentures due November 15, 2007, principal
amount at maturity of $517.3 million, interest payable semiannually from May 15,
2001, redeemable at NTL Triangle's option after November 15, 2000;

                                        41
<PAGE>

  DIAMOND:

     (28) 13 1/4% Senior Discount Notes due September 30, 2004, principal amount
at maturity of $285.1 million, interest payable semiannually from March 31,
2000, redeemable at Diamond's option after September 30, 1999;

     (29) 11 3/4% Senior Discount Notes due December 15, 2005, principal amount
at maturity of $531.0 million, interest payable semiannually from June 15, 2001,
redeemable at Diamond's option on or after December 15, 2000;

     (30) 10 3/4% Senior Discount Notes due February 15, 2007, principal amount
at maturity of $420.5 million, interest payable semiannually beginning on August
15, 2002, redeemable at Diamond's option on or after December 15, 2002;

     (31) 10% Senior Sterling Notes due February 1, 2008, issued by Diamond
Holdings plc, a wholly-owned subsidiary of Diamond, principal amount at maturity
of L135.0 million ($196.3 million), interest payable semiannually from August 1,
1998, redeemable at Diamond's option on or after February 1, 2003; and

     (32) 9 1/8% Senior Notes due February 1, 2008, issued by Diamond Holdings
plc, principal amount at maturity of $110.0 million, interest payable
semiannually from August 1, 1998, redeemable at Diamond's option on or after
February 1, 2003.

     Set forth below is a description of defaults, as well as whether such
defaults have led to an event of default or acceleration of indebtedness, with
respect to our preferred stock, our bank facilities and our outstanding notes,
each as of April 16, 2002, the date of the original filing of NTL Incorporated's
Report on Form 10-K for the year ended December 31, 2001.

                                PREFERRED STOCK

<Table>
<Caption>
                                                                                      EVENT OF DEFAULT/
                             LIQUIDATION PREFERENCE/             DEFAULT                 ACCELERATION
                            (AS OF DECEMBER 31, 2001)     (AS OF APRIL 16, 2002)    (AS OF APRIL 16, 2002)
                            -------------------------   --------------------------  ----------------------
<S>                         <C>                         <C>                         <C>
NTL INCORPORATED
1. Senior Redeemable
   Exchangeable Preferred
   Stock due February 15,
   2009...................  $186.8 million              Failure to pay $6.0         n.a.
                                                        million of dividends
                                                        payable February 15, 2002
2. 5% Cumulative Preferred
   Stock..................  $3,000.0 million            Failure to pay $24.9        n.a.
                                                        million of dividends
                                                        payable December 31, 2001
                                                        and $24.1 million of
                                                        dividends payable March
                                                        26, 2002
3. 5% Convertible
   Preferred Stock due
   March 27, 2009.........  $2,029.1 million            Failure to pay $37.0        n.a.
                                                        million of dividends
                                                        payable December 31, 2001
                                                        and $37.5 million of
                                                        dividends payable March
                                                        31, 2002
</Table>

                                        42
<PAGE>

<Table>
<Caption>
                                                                                      EVENT OF DEFAULT/
                             LIQUIDATION PREFERENCE/             DEFAULT                 ACCELERATION
                            (AS OF DECEMBER 31, 2001)     (AS OF APRIL 16, 2002)    (AS OF APRIL 16, 2002)
                            -------------------------   --------------------------  ----------------------
<S>                         <C>                         <C>                         <C>
4. Variable Coupon
   Redeemable Preferred
   Stock..................  $491.7 million              None                        n.a.
5. 6.5% Fixed Coupon
   Redeemable Preferred
   Stock..................  $126.9 million              None                        n.a.
</Table>

                               CREDIT FACILITIES

<Table>
<Caption>
                                AMOUNT AVAILABLE/                                    EVENT OF DEFAULT/
                               AMOUNT OUTSTANDING               DEFAULTS                ACCELERATION
                            (AS OF DECEMBER 31, 2001)    (AS OF APRIL 16, 2002)    (AS OF APRIL 16, 2002)
                            -------------------------  --------------------------  ----------------------
<S>                         <C>                        <C>                         <C>
NTLCL
1. Working Capital
   Facility...............  $145.4 million             Default (negotiation with   Event of default but
                            outstanding (additional    bondholders with a view to  for waivers
                            $461.8 million borrowed    rescheduling) but for
                            in January and February    waivers
                            2002)
2. Senior Credit
   Facility...............  $4,050.0 million           Default (negotiation with   Event of default but
                            outstanding                bondholders with a view to  for waivers
                                                       rescheduling) but for
                                                       waivers
CABLECOM
3. Term Loan Facility.....  $1,626.8 million           Default (negotiation with   Event of default but
                            outstanding                bondholders with a view to  for waivers
                                                       rescheduling,
                                                       overindebtedness, other
                                                       technical defaults) but
                                                       for waivers
4. Revolving Facility.....  $527.2 million             Default (negotiation with   Event of default but
                            outstanding                bondholders with a view to  for waivers
                                                       rescheduling,
                                                       overindebtedness, other
                                                       technical defaults) but
                                                       for waivers
</Table>

                               OUTSTANDING NOTES

<Table>
<Caption>
                                                                                      EVENT OF DEFAULT/
                               AMOUNT OUTSTANDING                DEFAULT                 ACCELERATION
                            (AS OF DECEMBER 31, 2001)     (AS OF APRIL 16, 2002)    (AS OF APRIL 16, 2002)
                            -------------------------   --------------------------  ----------------------
<S>                         <C>                         <C>                         <C>
NTL INCORPORATED
 1. 5 3/4% Convertible
    Subordinated Notes due
    June 22, 2011.........  $100.0 million              Payment default of $2.5     None
                                                        million of interest due
                                                        April 15, 2002
NTL DELAWARE
 2. 5 3/4% Convertible
    Subordinated Notes due
    December 15, 2009.....  $1,200.0 million            None                        None
</Table>

                                        43
<PAGE>

<Table>
<Caption>
                                                                                      EVENT OF DEFAULT/
                               AMOUNT OUTSTANDING                DEFAULT                 ACCELERATION
                            (AS OF DECEMBER 31, 2001)     (AS OF APRIL 16, 2002)    (AS OF APRIL 16, 2002)
                            -------------------------   --------------------------  ----------------------
<S>                         <C>                         <C>                         <C>
NTL COMMUNICATIONS
 3. 12 3/4% Senior
    Deferred Coupon Notes
    due 2005..............  $277.8 million              Payment default of $17.7    None
                                                        million of interest due
                                                        April 15, 2002
 4. 11 1/2% Senior
    Deferred Coupon Notes
    due 2006..............  $1,050.0 million            None                        None
 5. 10% Senior Notes due
    2007..................  $400.0 million              None                        None
 6. 9 1/2% Senior Sterling
    Notes due 2008........  $181.4 million              Payment default of $8.6     None
                                                        million of interest due
                                                        April 1, 2002
 7. 10 3/4% Senior
    Deferred Coupon
    Sterling Notes due
    2008..................  $382.3 million              None                        None
 8. 9 3/4% Senior Deferred
    Coupon Notes due
    2008..................  $1,153.8 million            None                        None
 9. 9 3/4% Senior Deferred
    Coupon Sterling Notes
    due 2009..............  $385.9 million              None                        None
10. 11 1/2% Senior Notes
    due 2008..............  $625.0 million              Payment default of $35.9    None
                                                        million of interest due
                                                        April 1, 2002
11. 12 3/8% Senior
    Deferred Coupon Notes
    due 2008..............  $364.9 million              None                        None
12. 7% Convertible
    Subordinated Notes due
    2008..................  $489.8 million              None                        None
13. 9 1/4% Senior Euro
    Notes due 2006........  $222.5 million              None                        None
14. 9 7/8% Senior Euro
    Notes due 2009........  $311.5 million              None                        None
15. 11 1/2% Senior
    Deferred Coupon Euro
    Notes due 2009........  $135.6 million              None                        None
16. 11 7/8% Senior Notes
    due 2010..............  $490.7 million              Payment default of $29.7    None
                                                        million of interest due
                                                        April 1, 2002
17. 12 3/8% Senior Euro
    Notes due 2008........  $267.8 million              None                        None
18. 6 3/4% Convertible
    Senior Notes due
    2008..................  $1,150.0 million            None                        None
NTL TRIANGLE
19. 11.2% Senior Discount
    Debentures due
    November 15, 2007.....  $517.3 million              None                        None
</Table>

                                        44
<PAGE>

<Table>
<Caption>
                                                                                      EVENT OF DEFAULT/
                               AMOUNT OUTSTANDING                DEFAULT                 ACCELERATION
                            (AS OF DECEMBER 31, 2001)     (AS OF APRIL 16, 2002)    (AS OF APRIL 16, 2002)
                            -------------------------   --------------------------  ----------------------
<S>                         <C>                         <C>                         <C>
DIAMOND
20. 13 1/4% Senior
    Discount Notes due
    2004..................  $285.1 million              None                        None
21. 11 3/4% Senior
    Discount Notes due
    2005..................  $531.0 million              None                        None
22. 10 3/4% Senior
    Discount Notes due
    2007..................  $415.1 million              None                        None
23. 10% Senior Sterling
    Notes due 2008, issued
    by Diamond Holdings
    plc...................  $196.3 million              None                        None
24. 9 1/8% Senior Notes
    due 2008, issued
   by Diamond Holdings
    plc...................  $110.0 million              None                        None
</Table>

  CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

     On January 22, 2002, the Securities and Exchange Commission issued FR-61,
"Commission Statement about Management's Discussion and Analysis of Financial
Condition and Results of Operations." The release sets forth certain views of
the Securities and Exchange Commission regarding disclosure that should be
considered by registrants. The Company's consolidated contractual obligations
and commercial commitments are summarized below, and are fully disclosed in the
Notes to Consolidated Financial Statements.

     The following table includes aggregate information about the Company's
contractual obligations as of December 31, 2001 and the periods in which
payments are due. The entire long-term debt and capital lease obligation, except
for NTL Australia's portion of long-term debt, has been classified as current
due to the uncertainties about compliance with the terms and conditions of the
Company's debt that would give the holders of the debt the right to accelerate
repayment.

                             PAYMENTS DUE BY PERIOD

<Table>
<Caption>
                                                 LESS THAN    1-3       4-5        AFTER
CONTRACTUAL OBLIGATIONS                TOTAL      1 YEAR     YEARS     YEARS      5 YEARS
-----------------------              ---------   ---------   ------   --------   ---------
                                                         (IN MILLIONS)
<S>                                  <C>         <C>         <C>      <C>        <C>
Long-Term Debt.....................  $18,213.3    $  5.7     $515.0   $6,457.0   $11,235.6
Capital Lease Obligations..........      192.8       9.3       15.6       12.7       155.2
Operating Leases...................      712.5      64.5      119.9      112.1       416.0
Unconditional Purchase
  Obligations......................    1,672.0     434.0      325.0      237.0       676.0
Other Long-Term Obligations........       none
Total Contractual Cash
  Obligations......................  $20,790.6    $513.5     $975.5   $6,818.8   $12,482.8
</Table>

                                        45
<PAGE>

     The following table includes aggregate information about the Company's
commercial commitments as of December 31, 2001. Commercial commitments are items
that the Company could be obligated to pay in the future. They are not required
to be included in the consolidated balance sheet.

                   AMOUNT OF COMMITMENT EXPIRATION PER PERIOD

<Table>
<Caption>
                                        TOTAL AMOUNTS   LESS THAN    1-3     4-5     OVER
OTHER COMMERCIAL COMMITMENTS              COMMITTED      1 YEAR     YEARS   YEARS   5 YEARS
----------------------------            -------------   ---------   -----   -----   -------
                                                           (IN MILLIONS)
<S>                                     <C>             <C>         <C>     <C>     <C>
Guarantees............................     $ 31.0         $ 3.2     $ 1.4   $11.9    $14.5
Lines of Credit.......................       none
Standby Letters of Credit.............       none
Standby Repurchase Obligations........       none
Other Commercial Commitments..........       73.9          28.8      26.2    18.9       --
Total Commercial Commitments..........     $104.9         $32.0     $27.6   $30.8    $14.5
</Table>

  CONSOLIDATED STATEMENTS OF CASH FLOWS

     Cash used in operating activities was $597.8 million and $290.2 million in
the years ended December 31, 2001 and 2000, respectively. Cash provided by
operating activities was $73.9 million in the year ended December 31, 1999. Cash
paid for interest exclusive of amounts capitalized in the years ended December
31, 2001, 2000 and 1999 was $947.9 million, $495.0 million and $180.3 million,
respectively. In addition, the change in cash used in operating activities is
also due to changes in working capital as a result of the timing of receipts and
disbursements.

     Cash used in investing activities was $2,099.8 million, $13,428.2 million
and $1,797.5 million in the years ended December 31, 2001, 2000 and 1999,
respectively. In each of these years, cash used in investing activities was
primarily used for purchases of fixed assets and acquisitions, net of cash
acquired.

     Cash used for acquisitions, net of cash acquired, was $26.2 million,
$10,940.0 million and $1,128.3 million in the years ended December 31, 2001,
2000 and 1999.

     Cash used for acquisitions, net of cash acquired of $10,940.0 million,
proceeds from borrowings, net of financing costs of $6,870.1 million, proceeds
from issuance of preferred stock of $1,862.0 million, proceeds from issuance of
redeemable preferred stock of $1,850.0 million and proceeds from issuance of
common stock of $2,327.6 million in 2000 were primarily for the acquisitions of
Cablecom and ConsumerCo including the term loan facility and credit agreement
entered into with groups of banks, the common and preferred shares issued to
France Telecom and the preferred stock issued to France Telecom and certain
commercial banks.

     Purchases of fixed assets were $1,946.1 million, $2,257.0 million and
$1,211.3 million in the years ended December 31, 2001, 2000 and 1999,
respectively, as a result of the continuing fixed asset purchases and
construction, including purchases and construction by acquired companies. The
Company expects to further reduce purchases of fixed assets in 2002 in an effort
to conserve cash.

     Cash provided by financing activities was $2,633.9 million, $11,728.4
million and $3,591.0 million in the years ended December 31, 2001, 2000 and
1999, respectively. In each of these years, cash provided by financing
activities was primarily from proceeds from borrowings, net of financing costs,
and net of principal payments.

     Proceeds from borrowings, net of financing costs, of $3,110.7 million in
2001 include $838.5 million borrowed under the NTLCL senior credit facility,
$431.8 million borrowed under the NTLCL working capital facility, $1,150.0
million from the issuance of NTL Communications 6 3/4% Convertible Senior Notes,
$277.9 million from the issuance of NTL Communications 12 3/8% Senior Euro
Notes, $269.7 million borrowed under the Cablecom revolving facility, $103.4
million borrowed under the NTL Australia credit agreement, and $100.0 million
from the issuance of NTL Incorporated 5 3/4% Convertible Subordinated Notes, net
of aggregate financing costs of $60.6 million.

                                        46
<PAGE>

     Principal payments of $489.8 million in 2001 include optional repayments of
$455.1 million under the NTLCL credit agreements and Cablecom revolving facility
and repayments of an aggregate of $34.7 million of other debt.

     Proceeds from borrowings, net of financing costs, of $6,870.1 million in
2000 were primarily for the acquisitions of Cablecom and ConsumerCo including
the term loan facility and credit agreement entered into with groups of banks.
Included in proceeds from borrowings, net of financing costs, is $1,353.0
million of borrowings under credit facilities that was not related to
acquisitions.

     Principal payments of $1,303.0 million in 2000 include optional repayments
of $1,197.5 million of amounts borrowed under credit agreements.

     Proceeds from borrowings, net of financing costs, of $3,019.4 million in
1999 was from the issuance of various notes, including $808.6 million of notes
issued in connection with the acquisition of Cablelink.

     Principal payments of $758.2 million in 1999 were primarily from the
repayment of $716.5 million of notes issued in connection with the acquisition
of Cablelink from the proceeds of notes issued in 1999.

     Cash provided by financing activities in 1999 also included the following.
Proceeds from the issuance of preferred stock and warrants of $1.250.0 million
was from the sale of 5.25% Convertible Preferred Stock and warrants to purchase
1.9 million shares of the Company's common stock to Microsoft Corp. and the sale
of 5% Cumulative Participating Convertible Preferred Stock to France Telecom.
Proceeds from the issuance of common stock of $250.0 million was from the sale
of approximately 4.2 million shares of common stock to France Telecom.
Redemption of preferred stock of $125.3 million was for the redemption of all of
the outstanding shares of 9.9% Non-voting Mandatorily Redeemable Preferred
Stock, Series A in December 1999.

CRITICAL ACCOUNTING POLICIES

     The consolidated financial statements of the Company and related financial
information are based on the application of accounting principles generally
accepted in the United States, (referred to as "GAAP"). GAAP requires the use of
estimates, assumptions, judgments and subjective interpretations of accounting
principles that have an impact on the assets, liabilities, revenue and expense
amounts reported, as well as disclosures about contingencies, risk and financial
condition. The following critical accounting policies have the potential to have
a more significant impact on the Company's financial statements, either because
of the significance of the financial statement item to which they relate, or
because they require more judgment and estimation due to the uncertainty
involved in measuring, at a specific point in time, transactions which are
continuous in nature.

     - The Company maintains allowances for doubtful accounts and notes
       receivable for estimated losses resulting from the potential inability of
       its customers or the other parties to make payments. These allowance are
       estimated based on the current aging of receivables, prior collection
       experience and future expectations of conditions that might impact the
       collectibility. If the financial condition of our customers or the other
       parties were to deteriorate resulting in an impairment in their ability
       to make payments, additions to the allowances may be required.

     - The Company's determination of the treatment of contingent liabilities in
       the financial statements is based on a view of the expected outcome of
       the applicable contingency. Legal counsel is consulted on matters related
       to litigation. Experts both within and outside the company are consulted
       with respect to other matters that arise in the ordinary course of
       business. Examples of such matters that are based on assumptions,
       judgments and estimates are the amount to be paid to terminate certain
       agreements included in restructuring charges and the amounts to be paid
       to settle certain other liabilities. A liability is accrued if the
       likelihood of an adverse outcome is probable of occurrence and the amount
       is estimable.

     - The Company reviews long-lived assets and goodwill for impairment as
       described in the Notes to Consolidated Financial Statements. The Company
       obtained a valuation to assist with the determina-

                                        47
<PAGE>

       tion of the fair value of long-lived assets and goodwill. In analyzing
       potential impairments, projections of future cash flows from the asset
       are used. The projections are based on assumptions, judgments and
       estimates of growth rates for the related business, anticipated future
       economic, regulatory and political conditions, the assignment of discount
       rates relative to risk and estimates of terminal values. Changes to these
       variables in the future may necessitate impairment charges to reduce the
       carrying value to fair value.

     - Fixed assets and intangible assets are assigned useful lives which impact
       the annual depreciation and amortization expense. The assignment of
       useful lives involves significant judgments and the use of estimates.
       Changes in technology or changes in intended use of these assets may
       cause the estimated useful life to change.

     - In 2001, restructuring charges were recorded as a result of additional
       actions to reorganize, re-size and reduce operating costs and create
       greater efficiency in various areas. These charges, for both severance
       and exit costs, required the use of estimates. Actual results could
       differ from those estimated for restructuring.

     - The valuation of the Company's pension plans requires the use of
       assumptions and estimates that are used to develop actuarial valuations
       of expenses, projected benefit obligations and funding requirements.
       These assumptions include, among others, discount rates, investment
       returns and projected salary increases. Changes in assumptions and future
       investment returns could potentially have a material impact on the
       Company's pension expense and funding requirements.

RESULTS OF OPERATIONS

     NTL provides a broad range of communication services, including: (i) ntl:
home, delivering broadband services to residential markets comprising
residential telephone, analog and digital cable television, narrowband and
broadband Internet access, and interactive services; (ii) ntl: business,
delivering broadband services to business markets, comprising business
telecommunications, national and international carrier telecommunications,
narrowband and broadband Internet services, and radio communication services;
and (iii) ntl: broadcast, delivering digital and analog television and radio
broadcast transmission services, wireless network design, buildout, and
management, tower site rental, and satellite and media services.

     The Company's expects its growth in 2002 to be curtailed by funding
constraints. Although the Company's current business plan includes a reduction
in the number of new customers and an increase in revenue from existing
customers, the Company's cash constraints present many challenges to the
successful execution of the plan. The Company is conserving cash through a
reduction in capital expenditures including expenditures to connect new
customers to the Company's network. In order to maintain revenues and cash from
operations while reducing the number of new customers, the Company must reduce
and limit customer churn. The Company intends to improve its customer service
and increase its service offering to customers in an effort to curtail and
reduce churn. The Company is in the process of integrating its various billing
systems and customer databases in an effort to improve one of the main tools
used to provide customer service.

     The plan to reduce churn and to increase average revenue per unit (referred
to as ARPU) includes an increase in broadband services to our existing
customers. The Company believes that its triple play offering of telephony,
broadband access to the Internet and digital television will prove attractive to
its existing customer base, which will result in higher ARPU as revenues per
existing customer increase.

     Beginning in 2001, the Company became focused on adding customers that
subscribe to multiple services and/or to its digital television. By being
observant of this strategy the Company was able to add to ARPU. In 2001, the
Company's consumer telecommunications and television revenue, increased
primarily as a result of price increases on both our analog and digital cable
television products.

     The Company faces various challenges in meeting its goals of expanding its
broadband services to residential customers. Broadband Internet usage by
residential customers is a relatively new and undeveloped market. The Company
will need to continue to upgrade its digital television network despite its
current liquidity situation, while continuing to contend with its competitors.
As the Company pushes to increase its digital

                                        48
<PAGE>

television customer base through the successful migration of its current analog
customers, it needs to continue to improve its customer service, which is
expected with the completion of its integrated billing systems.

     The Company anticipates that the integration of its billing system and
customer data will be substantially complete by the end of the second quarter of
2003. The total project cost is estimated to be approximately L45 million.

     There is also significant competition in our markets, through digital
satellite and digital terrestrial television and through alternative Internet
access media, such as DSL offered by BT. If the Company is unable to charge the
prices for these services that are anticipated in its business plan in response
to competition or if the Company's competition is able to attract the Company's
customers, the Company's ARPU and results of operations will be adversely
affected. However, despite many new entrants into the telecommunications
industry during the last five to ten years generating significant over-capacity,
the Company believes that the current global downturn in the telecommunications
industry may result in an increase in the available customer base, as some of
these competitors will be forced to cease operations.

     The Company's broadband customer base has grown to approximately 377,700
subscribers at June 30, 2002 from approximately 185,500 at December 31, 2001.
The Company anticipates that its broadband customer base will continue to grow
in 2002.

     Media speculation regarding the Company's financial condition and potential
outcomes of the recapitalization process could have an adverse effect on parts
of the Company's business. Similarly, negative press about the financial
condition of alternative telecom carriers in general may effect the Company's
reputation. One of the key strategies in the Company's business plan is to
increase its penetration of higher value small to medium size enterprises (or
SMEs) and provide increased retail services of bundled voice, data and Internet
services for SMEs. However, due to the negative publicity surrounding the
Company's financial condition and the effect of that publicity on its brand
name, the Company may find it difficult to convince SMEs to become its
customers. Even if the Company successfully completes the recapitalization
process, there is no assurance that the negative publicity will not adversely
impact the Company's results of operations or have a long-term negative effect
on the Company's brand.

     In addition, this uncertainty may adversely affect the Company's
relationships with its suppliers. If suppliers become increasingly concerned
about the Company's financial condition, they may demand faster payments or not
extend normal trade credit, both of which could further adversely affect the
Company's cash conservation measures and its results of operations.

  YEARS ENDED DECEMBER 31, 2001 AND 2000

     As a result of the completion of the acquisitions of the cable assets of
Cablecom on March 28, 2000 and the consumer cable telephone, Internet and
television operations of Cable & Wireless Communications plc ("ConsumerCo") on
May 30, 2000, the Company consolidated the results of operations of these
businesses from the dates of acquisition.

     Consolidated revenues increased by 30.2% to $3,699.2 million in 2001, as
compared to $2,840.8 million in 2000. Revenue growth was achieved through
acquisitions and by improving our product offers, increasing our broadband and
digital TV customer base, raising prices and by serving new customers and
signing new contracts in our Broadcast and Business telecoms divisions.

     In 2001 and 2000 the United Kingdom accounted for 85.7% and 85.7%,
respectively, of total consolidated revenues. Switzerland accounted for 10.6%
and 9.8% of total consolidated revenues in 2001 and 2000, respectively, while
other geographic regions accounted for 3.7% and 4.5% of total consolidated
revenues in 2001 and 2000, respectively.

     Consumer telecommunications and television revenues were 68.0% and 64.1% of
total consolidated revenues in 2001 and 2000, respectively. Business
telecommunications revenues were 22.7% and 24.7% of total consolidated revenues
in 2001 and 2000, respectively. Broadcast transmission and other revenues were
9.3% and 11.2% of total consolidated revenues in 2001 and 2000, respectively.

                                        49
<PAGE>

     Consumer telecommunications and television revenues increased to $2,514.6
million from $1,819.8 million as a result of the Cablecom and ConsumerCo
acquisitions, price increases, upselling new services to customers and from
growth in the Company's customer base. The 2001 and 2000 revenue includes
$1,350.1 million and $809.5 million, respectively, from acquired companies.
Upselling to existing customers, new digital and cable modem customers and the
price increases implemented in the first and second quarters of 2001 resulted in
ARPU increases that contributed to the revenue increase. Increase in ARPU in the
future is also expected to be achieved by continuing to provide new services
such as digital television, cable modem and mobile telephone services to
consumer customers.

     Business telecommunications revenues increased to $840.6 million from
$702.2 million as a result of acquisitions and from the growth in the Company's
customer base. The acquisition of the assets and contracts of Viatel UK in the
third quarter of 2001 accounted for $65.3 million of the revenue in 2001. The
2001 and 2000 revenue includes $97.4 million and $62.1 million, respectively,
from ConsumerCo. In addition, the Company continues to focus specific sales and
marketing effort on winning business customers in its franchise areas and
increasing revenue from its existing customers.

     Broadcast transmission and other revenues increased to $344.0 million from
$318.8 million. The increase reflects increases in the number of broadcast
television and FM radio customers and accounts, which exceeded price cap
reductions in the Company's regulated services, and increases in satellite and
media services used by broadcast and media customers. The Company expects growth
in broadcast services to be driven primarily by contracts related to the
increased demand for tower infrastructure by wireless services operators
expanding and upgrading their networks for wireless broadband, the
digitalization of analog television and radio signals and the further
development of programming for the European markets requiring satellite and
terrestrial distribution services.

     In 2000 and 2001, the substantial majority of revenues in all segments were
derived from operations in the UK.

     Operating expenses (including network expenses) increased to $1,809.3
million from $1,387.6 million as a result of increases in interconnection and
programming costs due to revenue growth. The 2001 and 2000 expense includes
$657.8 million and $388.0 million, respectively, from Cablecom and ConsumerCo.

     Selling, general and administrative expenses increased to $1,181.6 million
from $1,109.1 million. The 2001 and 2000 expense includes $407.5 million and
$292.2 million, respectively, from Cablecom and ConsumerCo. Selling, general and
administrative expenses as a percentage of revenues decreased to 31.9% in 2001
from 39.0% in 2000. The percentage decrease reflects various cost savings
efforts.

     Asset impairments in 2001 of $9,072.7 million are related to intangible
assets and investments in affiliates. During 1999 and 2000, acquisitions were
made against a background of increasing consolidation and record valuations in
the telecommunications industry. In 2001, the Company performed a review of the
recoverability of its long-lived assets and associated goodwill. This review was
initiated because of the decline in the Company's stock price and significantly
lower valuations for companies within its industry. Additionally, at the time of
the Company's review, the book value of the Company's net assets significantly
exceeded its market capitalization. Accordingly, the fair value of the Company's
assets was determined by discounting the Company's estimates of the expected
future cash flows related to these assets when the non-discounted cash flows
indicated that the long-lived assets would not be recoverable. The Company
recorded a write-down of $9,511.3 million in the fourth quarter of 2001 as a
result of this analysis and review, of which $9,072.7 million is included in
asset impairments and $438.6 million is included in share of losses from equity
investments. The asset impairment charge of $9,072.7 included goodwill of
$8,840.5 million, license acquisition costs of $58.8 million, customer lists of
$9.1 million, other intangibles of $14.9 million, investments in affiliates of
$25.1 million and other assets of $124.3 million. The aggregate asset impairment
charge of $9,511.3 million related to the Company's business segments as
follows: $7,388.8 million Consumer, $2,113.0 million Business and $9.5 million
Broadcast.

     Non-cash compensation of $30.6 million in 2001 was due to modifications to
certain stock options approved by the Compensation and Option Committee of the
Board of Directors in July 2001. The latest

                                        50
<PAGE>

possible expiration date of options to purchase an aggregate of approximately
4.7 million shares of the Company's common stock with exercise prices from $.17
to $14.76 per share was extended from July 30, 2001 to October 2004, as
applicable, to January 30, 2006. The Company recognized non-cash compensation
expense based on the excess of the quoted market price of the Company's common
stock on the date of the modification of $12.05 per share over the exercise
price per share.

     Other charges of $311.7 million in 2001 include restructuring charges of
$209.6 million and costs of $102.1 million incurred primarily to integrate the
acquired companies, mostly related to information technology integration, as
well as costs incurred for business rationalization consulting. Other charges of
$92.7 million in 2000 include restructuring charges of $65.9 million and costs
of $26.8 million incurred primarily to integrate the acquired companies, mostly
related to information technology integration, as well as costs incurred for
business rationalization consulting. The increase in the information technology
integration and consulting costs was the result of an acceleration of a number
of these projects, and the associated fees to the consultants and advisors, in
order to achieve the cost savings earlier than projected.

     Restructuring charges of $209.6 million and $65.9 million for the years
ended December 31, 2001 and 2000, respectively, relate to the Company's
announcements in the fourth quarter of 2001 and in November 2000 that it was
taking additional actions to reorganize, re-size and reduce operating costs and
create greater efficiency in various areas of the Company. An aggregate of $57.9
million of the 2001 reorganization costs are for the write-off of equipment and
other assets that are not in use and will not require any future cash outlays.
The employee severance and related costs in 2000 were for approximately 2,300
employees to be terminated, approximately 550 of whom are still employed by the
Company as of December 31, 2001. These costs in 2001 are for approximately 5,400
employees to be terminated, of which approximately 3,000 employees are still
employed by the Company as of December 31, 2001. The following table summarizes
the restructuring charges incurred and utilized in 2000 and 2001:

<Table>
<Caption>
                                       EMPLOYEE
                                       SEVERANCE    LEASE
                                      AND RELATED   EXIT      AGREEMENT     FIXED
                                         COSTS      COSTS   MODIFICATIONS   ASSETS   TOTAL
                                      -----------   -----   -------------   ------   ------
                                                          (IN MILLIONS)
<S>                                   <C>           <C>     <C>             <C>      <C>
Charged to expense..................    $ 47.9      $18.0       $  --       $   --   $ 65.9
Utilized............................        --         --          --           --       --
                                        ------      -----       -----       ------   ------
Balance, December 31, 2000..........      47.9       18.0          --           --     65.9
2000 provision utilized.............     (41.3)      (9.6)         --           --    (50.9)
2000 provision released.............      (6.6)      (7.3)         --           --    (13.9)
Charged to expense..................      96.5       41.4        27.7         57.9    223.5
2001 provision utilized.............     (26.2)        --          --        (57.9)   (84.1)
                                        ------      -----       -----       ------   ------
Balance, December 31, 2001..........    $ 70.3      $42.5       $27.7       $   --   $140.5
                                        ======      =====       =====       ======   ======
</Table>

     Corporate expenses increased to $66.8 million from $47.5 million primarily
due to the write-off of deferred charges and an allowance for a note receivable
of $9.9 million and costs incurred in 2001 related to efforts to recapitalize
our balance sheet and reduce debt.

     Depreciation and amortization expense increased to $3,170.5 million from
$2,122.8 million due to an increase in amortization on acquisition related
intangibles and an increase in depreciation of telecommunications and cable
television equipment. The 2001 and 2000 expense includes $2,012.2 million and
$1,177.4 million, respectively, from Cablecom and ConsumerCo, including
amortization of the acquisition related intangibles.

     Interest income and other, net decreased to $51.1 million from $72.5
million as a result of the decline in cash available for investment.

     Interest expense increased to $1,440.9 million from $1,036.8 million due to
the issuance of additional debt. The 2001 and 2000 expense includes $393.8
million and $216.0 million, respectively related to Cablecom

                                        51
<PAGE>

and ConsumerCo. Interest of $1,015.6 million and $590.0 million was paid in cash
in the years ended December 31, 2001 and 2000, respectively.

     Share of losses from equity investments increased to $683.2 million from
$70.9 million primarily due to the asset impairment charge of $438.6 million in
the fourth quarter of 2001. The remainder of the increase is due to the
acquisition of the interest in Noos in 2001, and a full year of ownership of the
interests in B2 and eKabel in 2001.

     Other losses of $147.4 million in 2001 is comprised of $58.9 million loss
on the 1G transaction in France and $88.5 million loss on the sale of the
ConsumerCo off-net indirect access customers.

     Foreign currency transaction losses were $13.7 million in 2001 and $120.6
million in 2000 primarily due to the effect of changes in exchange rates. The
Company and certain of its subsidiaries have cash, cash equivalents and debt
denominated in non-U.S. dollar currencies that are affected by changes in
exchange rates. In addition, foreign subsidiaries of the Company whose
functional currency is not the U.S. dollar hold cash, cash equivalents and debt
denominated in U.S. dollars which are affected by changes in exchange rates.

     Income tax expense in 2001 of $63.2 million is primarily the result of an
increase in the deferred tax liability attributable to separate company profits
of a foreign subsidiary offset to some extent by a decrease in net deferred tax
liabilities attributable to operating losses of other foreign subsidiaries. The
increase in deferred tax liabilities includes an adjustment related to 1997
through 2000 of approximately $116.3 million that is primarily attributable to
additional tax depreciation being claimed during 2001 on original and amended
income tax returns.

     Consolidated net loss increased to $14,241.3 million in 2001, from $2,963.7
million in 2000. The increase in net loss was primarily a result of the asset
impairment charges in 2001 of $9,072.7 and $438.6 million relating to the
Company's intangible assets and investments in affiliates.

     Premium TV is developing a Classic Sports television channel, and has a
contractual arrangement with the BBC permitting Premium TV to show football
(soccer) matches from the BBC's library. Classic Sport incurred a loss of $35.2
million for the year ended December 31, 2001; this was principally due to start
up costs associated with the new classic sports channel, which has not yet been
launched. In the fourth quarter of 2001, the Company decided to consolidate the
2001 results of the Classic Sport joint venture. As a result of the
consolidation, the Company recorded the entirety of Classic Sport's loss for the
year in its fourth quarter results. The fourth quarter portion of the full year
loss for Classic Sport amounted to approximately $7.0 million.

     On April 2, 2002, the Company announced that it completed the sale of its
Australian broadcast business to Macquarie Bank for A$850.0 million (US$434.9
million) in an all cash transaction. The net proceeds from the sale after the
repayment of the outstanding bank credit facility and transaction related costs
were approximately A$574.0 million (US$293.7 million). In 2001, revenue from the
Company's broadcast business in Australia was $61.8 million and revenue from the
Company's 1G subsidiary in France was $11.2 million. The combined operating loss
of these entities in 2001 including depreciation and amortization was $26.9
million.

  YEARS ENDED DECEMBER 31, 2000 AND 1999

     As a result of the completion of the acquisitions of Diamond Cable
Communications Limited ("Diamond") in March 1999, the Australian National
Transmission Network ("NTL Australia") in April 1999, Cablelink Limited
("Cablelink") in July 1999, the "1G Networks" of France Telecom in August and
December 1999, NTL Business Limited (formerly Workplace Technologies plc) ("NTL
Business") in September 1999, the cable assets of Cablecom in March 2000 and the
consumer cable telephone, Internet and television operations of ConsumerCo in
May 2000, the Company consolidated the results of operations of these businesses
from the dates of acquisition.

                                        52
<PAGE>

     Consolidated revenues increased by 79.3% to $2,840.8 million in 2000, as
compared to $1,584.1 million in 1999. Revenue growth was achieved through
acquisitions and by increasing our consumer customer base and by serving new
customers and signing new contracts in our Broadcast and Business telecoms
divisions.

     In 2000 and 1999, the United Kingdom accounted for 85.7% and 95.2%,
respectively, of total consolidated revenues. Switzerland accounted for 9.8% of
total consolidated revenues in 2000, while other geographic regions accounted
for 4.5% and 4.8% of total consolidated revenues in 2000 and 1999, respectively.

     Consumer telecommunications and television revenues were 64.1% and 52.7% of
total consolidated revenues in 2000 and 1999, respectively. Business
telecommunications revenues were 24.7% and 28.6% of total consolidated revenues
in 2000 and 1999, respectively. Broadcast transmission and other revenues were
11.2% and 18.7% of total consolidated revenues in 2000 and 1999, respectively.

     Consumer telecommunications and television revenues increased to $1,819.8
million from $834.3 million as a result of acquisitions and from customer growth
that increased the Company's current revenue stream. The 2000 and 1999 revenue
includes $1,063.4 million and $167.1 million, respectively, from acquired
companies.

     Business telecommunications revenues increased to $702.2 million from
$452.5 million as a result of acquisitions, customer growth and increases in
carrier services revenues. The 2000 and 1999 revenue includes $234.3 million and
$92.8 million, respectively, from acquired companies. Carrier services revenues
increased due to growth in services provided by the Company's wholesale
operation to other telephone companies.

     Broadcast transmission and other revenues increased to $318.8 million from
$297.3 million. Included in these amounts are revenues of $55.0 million and
$40.0 million from NTL Australia in 2000 and 1999, respectively. The UK increase
reflects increases in broadcast television and FM radio customers and accounts,
which exceeded price cap reductions in the Company's regulated services, and
increases in satellite and media services used by broadcast and media customers.

     Operating expenses (including network expenses) increased to $1,387.6
million from $798.6 million as a result of increases in interconnection and
programming costs due to customer growth. Operating expenses as a percentage of
revenues declined to 48.8% from 50.4%. The 2000 and 1999 expense includes $649.6
million and $171.9 million, respectively, from acquired companies.

     Selling, general and administrative expenses increased to $1,109.1 million
from $574.6 million as a result of increases in telecommunications and cable
television sales and marketing costs and increases in additional personnel and
overhead to service the increasing customer base. The 2000 and 1999 expense
includes $483.4 million and $58.7 million, respectively, from acquired
companies.

     Pursuant to the terms of various UK licenses, the Company incurred license
fees paid to the Independent Television Commission ("ITC") to operate as the
exclusive service provider in certain of its franchise areas. Upon a request by
the Company in 1999, the ITC converted all of the Company's fee bearing
exclusive licenses to non-exclusive licenses at the end of 1999, and the
Company's liability for license payments ceased upon the conversion. Franchise
fees were $16.5 million in 1999.

     Other charges of $92.7 million in 2000 include restructuring charges of
$65.9 million and costs of $26.8 million incurred primarily to integrate the
acquired companies, mostly related to information technology integration, as
well as costs incurred for business rationalization consulting. Other charges of
$16.2 million in 1999 were incurred for the cancellation of certain contracts.

     Corporate expenses increased to $47.5 million from $29.4 million due to an
increase in various overhead costs.

     Depreciation and amortization expense increased to $2,122.8 million from
$791.3 million due to an increase in depreciation of telecommunications and
cable television equipment. The 2000 and 1999 expense includes $1,481.1 million
and $215.9 million, respectively, from acquired companies, including
amortization of acquisition related intangibles.

                                        53
<PAGE>

     Interest expense increased to $1,036.8 million from $680.7 million due to
the issuance of additional debt, and the increase in the accretion of original
issue discount on the deferred coupon notes. The 2000 and 1999 expense includes
$380.4 million and $134.5 million, respectively, related to acquisitions.
Interest of $590.0 million and $222.1 million was paid in the years ended
December 31, 2000 and 1999, respectively.

     Share of losses from equity investments increased to $70.9 million from
$18.4 million primarily due to increases in the net losses of affiliates
accounted for by the equity method.

     Other gains of $493.1 million in 1999 are from the sale of the Company's
investment in Cable London.

     Foreign currency transaction (losses) gains decreased to losses of $120.6
million from gains of $12.7 million primarily due to the effect of unfavorable
changes in exchange rates. The Company's results of operations are impacted by
changes in foreign currency exchange rates as follows. The Company and certain
of its subsidiaries have cash, cash equivalents and debt denominated in non-U.S.
dollar currencies that are affected by changes in exchange rates. In addition,
foreign subsidiaries of the Company whose functional currency is not the U.S.
dollar hold cash, cash equivalents and debt denominated in U.S. dollars which
are affected by changes in exchange rates.

     The Company recorded an extraordinary loss from the early extinguishment of
debt of $3.0 million in 1999 as a result of the repayment of the bridge loan
incurred in connection with the Cablelink acquisition.

     Consolidated net loss increased to $2,963.7 million in 2000, from $735.7
million in 1999 as a result of the factors discussed above.

RECENT ACCOUNTING PRONOUNCEMENTS

     In August 2001, the Financial Accounting Standards Board (referred to as
the FASB) issued Statement of Financial Accounting Standards (referred to as
SFAS) No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets,"
effective for the Company on January 1, 2002. This Statement supercedes SFAS No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" and other related accounting guidance. The adoption of
this new standard had no significant effect on the results of operations,
financial condition or cash flows of the Company, except that it will require
the Company to treat NTL Australia as a discontinued operation beginning in the
first quarter of 2002.

     In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations," effective for the Company on January 1, 2003. This
Statement addresses financial accounting and reporting for obligations
associated with the retirement of tangible fixed assets and the associated asset
retirement costs. The Company is in the process of evaluating the financial
statement impact of the adoption of SFAS No. 143.

     In June 2001, the FASB issued SFAS No. 141, "Business Combinations," and
No. 142, "Goodwill and Other Intangible Assets." SFAS No. 141 requires that the
purchase method of accounting be used for all business combinations initiated
after June 30, 2001. Use of the pooling-of-interests method is no longer
permitted. SFAS No. 141 also includes guidance on the initial recognition and
measurement of goodwill and other intangible assets acquired in a business
combination that is completed after June 30, 2001. SFAS No. 142 ends the
amortization of goodwill and indefinite-lived intangible assets. Instead, these
assets must be reviewed annually (or more frequently under certain conditions)
for impairment in accordance with this statement. This impairment test uses a
fair value approach rather than the undiscounted cash flow approach previously
required by SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of." The Company adopted SFAS No. 142
on January 1, 2002. In light of the significant impairment charge that the
Company recorded in 2001, the Company does not expect that the adoption of this
new standard will have a significant effect on the results of operations,
financial condition or cash flows of the Company. Amortization expense in 2001
related to goodwill and other indefinite lived intangible assets was $1,430.2
million. Estimated aggregate amortization expense for each of the five
succeeding fiscal years from December 31, 2001 is as follows: $128.8 million in
2002, $127.6 million in 2003, $79.7 million in 2004, $42.3 million in 2005 and
$34.5 million in 2006.

                                        54
<PAGE>

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

MARKET RISK

     The Company is exposed to various market risks, including changes in
foreign currency exchange rates and interest rates. Market risk is the potential
loss arising from adverse changes in market rates and prices, such as foreign
currency exchange and interest rates. The Company does not enter into derivative
financial instruments for trading or speculative purposes. The Company has
entered into derivative financial instruments to hedge exposure to movements in
the British pound/U.S. dollar exchange rate and the Euro to British pound
exchange rate, and interest rates related to certain of its floating interest
rate debt. The counterparties are major financial institutions.

FOREIGN EXCHANGE CONTRACTS

     To the extent the Company obtains financing in U.S. dollars and incurs
construction and operating costs in various other currencies, the Company will
encounter currency exchange rate risks. Furthermore, the Company's revenues are
generated in foreign currencies while its interest and principal obligations
with respect to most of its existing indebtedness are payable in U.S. dollars.

     At December 31, 2001, the Company had cross currency swaps to hedge
exposure to movements in the Euro to British pound exchange rate and a British
pound forward foreign exchange agreement to reduce its exposure to movement in
the British pound/U.S. dollar exchange rate.

     In September 2001, the Company entered into a British pound forward foreign
exchange agreement, consisting of twenty-six accumulating forward contracts, to
reduce its exposure to movement in the British pound/U.S. dollar exchange rate
in accordance with its market risk strategies.

INTEREST RATES

     The fair market value of long-term fixed interest rate debt and the amount
of future interest payments on floating interest rate debt are subject to
interest rate risk. Generally, the fair market value of fixed interest rate debt
will increase as interest rates fall and decrease as interest rates rise.

     The Company has entered into zero cost collars to hedge exposure to the
floating interest rate indebtedness incurred under the Cablecom term loan
facility and revolving loan facility. The notional amount of the zero cost
collars was CHF 1,200.0 million at December 31, 2001.

     The Company has also entered into interest rate swaps to hedge exposure to
the floating rate indebtedness incurred under the NTLCL L200.0 million Term
Facility. The notional amount of the interest rate swaps was L100.0 million at
December 31, 2001.

     The following table provides information about the Company's long-term
fixed and floating interest rate debt and derivative financial instruments that
are sensitive to changes in interest rates and foreign currency exchange rates.

                       NTL INCORPORATED AND SUBSIDIARIES
<Table>
<Caption>
                      YEAR ENDING   YEAR ENDING    YEAR ENDING      YEAR ENDING      YEAR ENDING
                       12/31/02      12/31/03        12/31/04         12/31/05         12/31/06      THEREAFTER      TOTAL
                      -----------   -----------   --------------   --------------   --------------   -----------   ----------
<S>                   <C>           <C>           <C>              <C>              <C>              <C>           <C>
LONG-TERM DEBT
 INCLUDING CURRENT
 PORTION
U.S. Dollar
 Fixed Rate..........      --            --              $ 285.1          $ 808.8         $1,050.0      $7,262.6     $9,406.5
 Average Interest
   Rate..............                                      13.25%           12.09%           11.50%         9.00%
UK Pound
 Fixed Rate..........      --            --                   --               --               --        L890.0       L890.0
 Average Interest
   Rate..............                                                                                      10.09%
 Average Forward
   Exchange Rate.....                                                                                     1.4372

<Caption>
                       FAIR VALUE
                        12/31/01
                       ----------
<S>                    <C>
LONG-TERM DEBT
 INCLUDING CURRENT
 PORTION
U.S. Dollar
 Fixed Rate..........    $2,671.7
 Average Interest
   Rate..............
UK Pound
 Fixed Rate..........      L311.2
 Average Interest
   Rate..............
 Average Forward
   Exchange Rate.....
</Table>

                                        55
<PAGE>
<Table>
<Caption>
                      YEAR ENDING   YEAR ENDING    YEAR ENDING      YEAR ENDING      YEAR ENDING
                       12/31/02      12/31/03        12/31/04         12/31/05         12/31/06      THEREAFTER      TOTAL
                      -----------   -----------   --------------   --------------   --------------   -----------   ----------
<S>                   <C>           <C>           <C>              <C>              <C>              <C>           <C>
Euro
 Fixed Rate..........      --            --                   --               --           E250.0        E860.0     E1,110.0
 Average Interest
   Rate..............                                                                         9.25%        11.14%
 Average Forward
   Exchange Rate.....                                                                        .8948         .9090
UK Pound
 Variable Rate.......      --            --                L90.0         L2,494.8           L100.0            --     L2,684.8
 Average Interest
   Rate..............                                      LIBOR%           LIBOR%           LIBOR%
                                                        plus 2.0         plus 2.0         plus 5.5
 Average Forward
   Exchange Rate.....                                     1.4131           1.4150           1.4185
UK Pound Variable
 Rate................                                                                        L20.0        L180.0       L200.0
 Average Interest
   Rate..............                                                                        LIBOR%        LIBOR%
                                                                                          plus 3.5      plus 3.5
 Average Forward
   Exchange Rate.....                                                                       1.4185        1.4301
CHF
 Variable Rate.......      --            --             CHF143.0         CHF250.3         CHF536.3    CHF2,645.4   CHF3,575.0
 Average Interest
   Rate..............                                Swiss LIBOR%     Swiss LIBOR%     Swiss LIBOR%  Swiss LIBOR%
                                                        plus 2.5         plus 2.5         plus 2.5      plus 2.5
 Average Forward
   Exchange Rate.....                                      .6101            .6174            .6249         .6567
Australian Dollar
 Variable Rate.......      --            --              A$ 15.0         A$  25.0        A$  160.0            --    A$  200.0
 Average Interest
   Rate..............                                A$ Bank Bid%     A$ Bank Bid%     A$ Bank Bid%
                                                  Rate plus 1.85   Rate plus 1.85   Rate plus 1.85
 Average Forward
   Exchange Rate.....                                      .5234            .5235            .5236

<Caption>
                       FAIR VALUE
                        12/31/01
                       ----------
<S>                    <C>
Euro
 Fixed Rate..........      E353.5
 Average Interest
   Rate..............
 Average Forward
   Exchange Rate.....
UK Pound
 Variable Rate.......    L2,684.5
 Average Interest
   Rate..............
 Average Forward
   Exchange Rate.....
UK Pound Variable
 Rate................      L200.0
 Average Interest
   Rate..............
 Average Forward
   Exchange Rate.....
CHF
 Variable Rate.......  CHF3,575.0
 Average Interest
   Rate..............
 Average Forward
   Exchange Rate.....
Australian Dollar
 Variable Rate.......   A$  200.0
 Average Interest
   Rate..............
 Average Forward
   Exchange Rate.....
</Table>
<Table>
<Caption>
                             YEAR ENDING   YEAR ENDING   YEAR ENDING   YEAR ENDING   YEAR ENDING
                              12/31/02      12/31/03      12/31/04      12/31/05      12/31/06     THEREAFTER     TOTAL
                             -----------   -----------   -----------   -----------   -----------   ----------   ----------
<S>                          <C>           <C>           <C>           <C>           <C>           <C>          <C>
INTEREST RATE DERIVATIVE
 FINANCIAL INSTRUMENTS
 RELATED TO LONG-TERM DEBT
Interest Rate Swaps
 Notional CHF Amount........ CHF1,200.0    CHF1,200.0    CHF1,200.0         --            --            --      CHF1,200.0
 Average Floor Strike
   Rate.....................       3.27%         3.27%         3.27%
 Average Cap Strike Rate....       5.15%         5.15%         5.15%
Interest Rate Swaps
 Notional UK Pound Amount...     L100.0        L100.0                                                               L100.0
 Fixed Strike Price.........       4.33%         4.33%
Receipt of UK Pounds
 Notional Euro Amount.......      E76.3            --            --         --            --            --           E76.3
 Average Contract Rate......      .6457

<Caption>
                              FAIR VALUE
                               12/31/01
                              ----------
<S>                           <C>
INTEREST RATE DERIVATIVE
 FINANCIAL INSTRUMENTS
 RELATED TO LONG-TERM DEBT
Interest Rate Swaps
 Notional CHF Amount........   CHF(25.2)
 Average Floor Strike
   Rate.....................
 Average Cap Strike Rate....
Interest Rate Swaps
 Notional UK Pound Amount...       L0.2
 Fixed Strike Price.........
Receipt of UK Pounds
 Notional Euro Amount.......      E(4.0)
 Average Contract Rate......
</Table>

RELATED FORWARD CONTRACTS TO SELL FOREIGN CURRENCIES FOR US $

  U.K. POUND

<Table>
<Caption>
                                                              YEAR ENDING   FAIR VALUE
                                                               12/31/02*     12/31/01
                                                              -----------   ----------
<S>                                                           <C>           <C>
Notional amount.............................................  Up to $47.5     $(0.3)
Average contract rate.......................................         1.45
</Table>

---------------

* The last contract ends on May 30, 2002.

                                        56
<PAGE>

                                  RISK FACTORS

WE CURRENTLY HAVE LIMITED LIQUIDITY. IF WE ARE UNABLE TO SUCCESSFULLY IMPLEMENT
A RECAPITALIZATION, THERE IS SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS
A GOING CONCERN.

     We have limited liquidity. We do not currently have access to our historic
sources of liquidity in the capital markets and our credit facilities are either
fully drawn or we are currently unable to access remaining undrawn amounts. If
we make scheduled payments of interest and overdue payments of interest, then we
will not have sufficient cash resources to meet our liquidity needs through the
third quarter of 2002. As a consequence, we need to restructure our outstanding
debt and/or raise new funds. If we cannot restructure our indebtedness or obtain
additional liquidity in a timely manner, we may face the possibility of
insolvency proceedings in the UK, the United States or elsewhere.

THE SUCCESSFUL IMPLEMENTATION OF THE PROPOSED RECAPITALIZATION PLAN WILL REQUIRE
THE SUPPORT OF OUR CREDITORS AND PREFERRED STOCKHOLDERS.

     The completion of the proposed recapitalization contemplated by the
agreement in principle with the unofficial bondholder committee will require
support from our creditors and holders of our preferred stock, including France
Telecom. Pursuant to the terms of our credit facilities waivers, the agreement
in principle reached with the unofficial committee is subject to the approval of
the lenders under our credit facilities. The proposed recapitalization plan
would be implemented pursuant to a Chapter 11 bankruptcy proceeding.
Consummation of such a plan will require a favorable vote by impaired classes of
creditors, satisfaction of bankruptcy law requirements and confirmation by the
bankruptcy court, which, as a court of equity, may exercise substantial
discretion and choose not to confirm any plan of reorganization we agree with
our creditors. Even if such a plan received the necessary support from many
classes of our creditors, there can be no assurance that it would be completed.
If a protracted reorganization was to occur, or a liquidation would be
necessary, there is a risk that the value of NTL would be eroded to the
detriment of some or all NTL stakeholders.

WE CANNOT BE CERTAIN THAT OUR BANK LENDERS WILL CONSENT TO THE PROPOSED
RECAPITALIZATION PLAN OR GRANT US ANY NEW WAIVERS WE MAY NEED.

     Before we could commence negotiations with the unofficial committee of our
noteholders we needed to obtain waivers from the lenders under our credit
facilities. These lenders granted waivers which, until April 30, 2002 in the
case of the UK credit facilities, or May 14, 2002 in the case of the Cablecom
facility, provide that NTL's commencement of negotiations with bondholders with
a view to rescheduling of its debt will not constitute an event of default under
our credit facilities.

     The waivers prohibit us from making an exchange offer with respect to our
outstanding notes or from entering into an agreement with bondholders without
the consent of the lenders under each of the credit facilities. The waivers also
prohibit us from commencing voluntary dissolution proceedings, including
proceedings under Chapter 11 of the U.S. Bankruptcy Code, without the consent of
these lenders. If we are unable to obtain the consent of the lenders, we will
not be able to make a voluntary Chapter 11 filing as contemplated in connection
with the proposed plan.

     The UK credit facility waivers, if not extended, will terminate on April
30, 2002, unless the missed interest payments on April 1, 2002 are remedied or a
sufficient number of noteholders have agreed to waive or forbear from exercising
any rights in respect of such non-payment, in which case, the waivers will be
extended to May 14, 2002. If the waivers terminate and we continue to negotiate
with bondholders or the non-payment of interest is not cured, there will be
events of default under our credit facilities that will entitle the lenders to
accelerate repayment. We do not have sufficient cash resources to repay our
outstanding indebtedness if it is declared immediately due and payable. In
addition, the lenders could also seek to take control over the assets over which
they hold security in an insolvency proceeding.

     As of December 31, 2001, the liabilities of Cablecom and some of its
subsidiaries exceeded their respective assets. As a consequence, those entities
were deemed to be overindebted under Swiss law. This
                                        57
<PAGE>

constitutes an event of default under the Cablecom credit facility which
entitles the lenders to accelerate repayment. We are currently in discussions
with the lenders under the Cablecom facility regarding proposals to resolve the
overindebtedness issues as well as requesting that they waive various other
covenant breaches under the credit facility. If we are unable to resolve the
issue by April 30, 2002, Cablecom and those subsidiaries would be required to
commence an insolvency proceeding in Switzerland. Those proceedings would likely
either be a court supervised moratorium in which an independent administrator,
or commissioner, would be appointed to supervise the running of each company
during a restructuring or, if there is no viable restructuring plan, a
bankruptcy. This could also result in a cross-acceleration of NTL Incorporated's
and NTL Delaware's 5.75% convertible subordinated notes due 2009 and 5.75%
convertible subordinated notes due 2011.

WE DID NOT PAY INTEREST DUE ON SOME OF OUR OUTSTANDING NOTES ON APRIL 1 AND
APRIL 15, 2002; WE MAY NOT CURE THE EXISTING EVENT OF DEFAULT. WE MAY NOT MAKE
FUTURE INTEREST PAYMENTS ON MOST OF OUR OUTSTANDING NOTES.

     NTL Incorporated, NTL (Delaware), Inc. and NTL Communications did not make
scheduled interest payments and payments of related fees due April 1 and April
15, 2002.

     If we fail to pay interest on these notes after a 30 day grace period
expires (on April 30, 2002 in the case of the missed interest payments due April
1, 2002), events of default for failure to pay interest would occur under the
relevant indentures and, contemporaneously, cross defaults would occur under
other of our indentures at NTL Communications, NTL Delaware, NTL Incorporated
and under the UK credit facilities and could occur under the Cablecom facility.
This would give holders of the outstanding series of debt at these entities the
right to accelerate repayment of those debts by declaring the principal amount
of the debts to be immediately due and payable unless we obtain waivers or
forbearance agreements from sufficient percentages of our creditors. If that
right to accelerate was exercised, we would not have sufficient cash resources
to repay those debts, which could ultimately lead to bankruptcy proceedings
relating to the entities so affected.

WE HAVE NO CURRENT AVAILABILITY TO BORROW UNDER OUR EXISTING CREDIT FACILITIES.

     We have no current ability to borrow under our existing UK credit
facilities, as we have borrowed the full amounts available, or to borrow under
the Cablecom credit facility, as the lenders have imposed a drawstop, which
means we currently cannot access the underdrawn amount.

IF WE MAKE A VOLUNTARY BANKRUPTCY FILING IN CONNECTION WITH THE PROPOSED PLAN OF
RECAPITALIZATION, IT IS LIKELY WE WILL LOSE OUR NET OPERATING LOSS CARRYFORWARDS
FOR U.S. INCOME TAX PURPOSES.

     We need to restructure our outstanding debt during 2002. A restructuring of
our debt can be expected to give to rise to cancellation of indebtedness
("COD"), which if it occurs in the course of a proceeding pursuant to Chapter 11
of the U.S. Bankruptcy Code, would be non-taxable. If the COD is non-taxable, we
will be required to reduce our net operating loss carryforwards and other
attributes such as tax basis in assets by an amount equal to the non-recognized
COD. As a result, it is likely that as a result of the successful completion of
the proposed plan of recapitalization, we will have no U.S. net operating loss
carryforwards.

UNCERTAINTY OVER OUR FINANCIAL CONDITION MAY HARM OUR BUSINESS AND OUR BRAND
NAME.

     Media speculation regarding our financial condition and potential outcomes
of the recapitalization process could have an adverse effect on parts of our
business. Similarly, negative press about the financial condition of alternative
telecom carriers in general may effect our reputation. For example, one of our
key strategies is to increase our penetration of higher value small to medium
size enterprises (or SMEs) and provide increased retail services of bundled
voice, data and Internet services for SMEs. However, due to the negative
publicity surrounding our financial condition and the potential effect of that
publicity on our brand name, we may find it difficult to convince SMEs to take
up our services. Even if we successfully complete the recapitalization process,
there is no assurance that it will not adversely impact our results of
operations or have a long-term effect on our brand.

                                        58
<PAGE>

     In addition, this uncertainty may adversely affect our relationships with
our suppliers. If suppliers become increasingly concerned about our financial
condition they may demand quicker payment terms or not extend normal trade
credit, both of which could further adversely affect our working capital
position. We may not be successful in obtaining alternative suppliers if the
need arises and this would adversely affect our results of operations.

THE RECAPITALIZATION PROCESS HAS REQUIRED SIGNIFICANT TIME AND RESOURCES OF OUR
DIRECTORS AND SENIOR MANAGERS, WHICH COULD ADVERSELY AFFECT THE OPERATION OF OUR
BUSINESS.

     Our senior managers and directors have needed to spend significant amounts
of their time dealing with the negotiations with bondholders, bank lenders and
other stakeholders in connection with the recapitalization process and it is
likely that they will continue to devote significant amounts of their time to
this process for the foreseeable future. This has diverted their time and
resources from managing the operations of our business. If our senior managers
and directors continue to spend significant amounts of their time in connection
with the recapitalization process, this may have a negative impact on our
operations.

WE HAVE HISTORICALLY INCURRED LOSSES AND GENERATED NEGATIVE CASH FLOWS AND WE
CANNOT ASSURE YOU THAT WE WILL BE PROFITABLE IN THE FUTURE.

     Construction and operating expenditures and interest costs have resulted in
negative cash flow. We also expect to incur substantial additional losses. We
cannot be certain that we will achieve or sustain profitability in the future.
Failure to achieve profitability has and could in the future diminish our
ability to sustain our operations, obtain additional required funds and make
required payments on our indebtedness.

OUR GROWTH HAS BEEN CURTAILED BY FUNDING CONSTRAINTS.

     We have significantly decreased the amount we are spending on capital
expenditures due to our liquidity constraints. As a result, we will be unable to
increase our subscriber numbers in the short term and our revenue may be
adversely affected. The decrease in capital expenditure is the result of our
need to divert increasing amounts of our financial resources to service our
debt. The decrease in capital spending is in line with our current strategy of
maximizing revenue from our existing customers rather than increasing our
customer base. In our residential business in the UK, we expect subscriber
numbers to potentially decrease in 2002. The revenue we expect to result from
our capital expenditure is long-term in nature. The reduction in capital
expenditures for connecting new subscribers to our network will likely lead to a
decrease in the rate of revenue growth in the future. Difficulties in obtaining
additional funding will likely hamper our ability to connect new subscribers to
our network and increase our revenue.

ONE OF OUR KEY STRATEGIES IS TO REDUCE CUSTOMER CHURN. HOWEVER THERE CAN BE NO
ASSURANCE THAT WE WILL SUCCESSFULLY ACCOMPLISH THIS OR THAT OUR CHURN RATE WILL
NOT INCREASE.

     We have experienced rapid growth and development in a relatively short
period, either through acquisitions or connecting customers to our network. One
of our biggest challenges as we have grown has been to limit our customer churn
and the successful implementation of our business plan depends upon a reduction
in the percentage of our customers that stop using our services. Factors
contributing to increase of churn during 2001 included the continued integration
of our ConsumerCo acquisition, the existence of multiple billing systems, the
introduction of digital television and our decision to disconnect some of our
poor paying customers.

     In order to reduce churn in the future, we aim to improve our customer
service. This improvement will be difficult to obtain without an integrated
billing system and a customer database across our entire network. We do not as
yet have an integrated billing and operational platform.

     Another part of our strategy leading to reduction in churn is an increased
take up of broadband services by our existing customers. If this increased level
of take up does not materialize we may have difficulties in reducing churn
levels, thereby adversely impacting our results of operations.

                                        59
<PAGE>

FAILURE TO SUCCESSFULLY MARKET BROADBAND TO OUR EXISTING RESIDENTIAL CLIENT BASE
WILL ADVERSELY IMPACT OUR REVENUE AND RESULTS OF OPERATIONS.

     A significant component of our strategy to increase our average revenue per
unit is to successfully market broadband products to our existing residential
client base. Broadband usage by residential customers is in its infancy.
However, we believe that our triple play offering of telephony, broadband access
to the Internet and digital television will prove attractive to our existing
customer base and allow us to increase our average revenue per user. However, we
face significant competition in these markets, through digital satellite and
digital terrestrial television and through alternative Internet access media,
such as DSL offered by BT and some of our competitors have substantially greater
financial and technical resources than we do. If we are unable to charge prices
for broadband services that are anticipated in our business plan in response to
competition or if our competition delivers a better product to our customers,
our average revenue per unit and our results of operations will be adversely
affected.

WE HAVE GRANTED SUBSTANTIAL GOVERNANCE AND ECONOMIC RIGHTS IN CONNECTION WITH
THE FRANCE TELECOM INVESTMENT AND HAVE ENTERED INTO TRANSACTIONS WITH FRANCE
TELECOM THAT MAY IMPACT US AND A STOCKHOLDER'S INVESTMENT IN US.

     We have granted rights to France Telecom, including the right to appoint
directors, preemptive rights and the right to veto some significant corporate
transactions. Exercise by France Telecom of some or all of such rights may
impact us, including our ability to effect a consensual recapitalization, or the
value of our stock held by persons other than France Telecom. France Telecom is
a holder of our cumulative convertible preferred stock, Series A, which allows
the holders other than commercial banks and their affiliates to exchange such
stock for stock of an entity holding up to 50% of Cablecom.

THE COMPANIES IN WHICH WE HOLD MINORITY INVESTMENTS IN CONTINENTAL EUROPE MAY
REQUIRE ADDITIONAL FINANCING TO COMPLETE THEIR NETWORK ROLLOUTS -- THEIR ABILITY
TO OBTAIN SUCH FINANCING WILL DEPEND ON THEIR ABILITY TO ACCESS THE CAPITAL
MARKETS AND THE VALUE OF OUR INVESTMENT COULD BE REDUCED OR DILUTED.

     We have minority investments in broadband cable operations in Germany,
France and Sweden. Each of those companies may require substantial amounts of
additional capital to complete their network rollouts and upgrades and their
ability to obtain that financing will depend, in part, on their ability to
access the capital markets. The ability of those companies to access the capital
markets will be subject not only to the performance of their business and
prospects, but to conditions in the capital markets generally. If those
companies cannot complete their planned expansions and upgrades for any reason,
the value of our investments could be reduced. If those companies issue equity
securities, it is likely that we will not be able to participate which could
lead to substantial dilution of the value of these investments to us.

WE ARE DEPENDENT UPON A SMALL NUMBER OF KEY PERSONNEL.

     A small number of key executive officers manage our businesses. The loss of
one or more of these executive officers could have a material adverse effect on
us. We believe that our future success will depend in large part on our
continued ability to attract and retain highly skilled and qualified personnel.
We have not entered into written employment contracts or non-compete agreements
with, nor have we obtained life insurance policies covering those key executive
officers.

OUR PRINCIPAL BUSINESSES ARE SUBJECT TO GOVERNMENT REGULATION, INCLUDING PRICING
REGULATION, AND CHANGES IN CURRENT REGULATIONS MAY ADVERSELY AFFECT US.

     Our principal business activities in the UK, the Republic of Ireland,
France, Switzerland and Australia and the activities of the companies in which
we have investments in Germany and Sweden are regulated and supervised by
various governmental bodies. Changes in laws, regulations or governmental policy
or the interpretations of those laws or regulations affecting our activities and
those of our competitors, such as licensing requirements, changes in price
regulation and deregulation of interconnection arrangements, could have a
material adverse effect on us.

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<PAGE>

     We are also subject to regulatory initiatives of the European Commission.
Changes in EU Directives may reduce our range of programming and increase the
costs of purchasing television programming or require us to provide access to
our cable network infrastructure to other service providers, which could have a
material adverse effect on us.

THE TELECOMMUNICATIONS INDUSTRY IS SUBJECT TO RAPID TECHNOLOGICAL CHANGES AND WE
CANNOT PREDICT THE EFFECT OF ANY CHANGES ON OUR BUSINESSES.

     The telecommunications industry is subject to rapid and significant changes
in technology and the effect of technological changes on our businesses cannot
be predicted. Our core offerings may become outdated due to technological
breakthroughs rendering our products out of date. In addition, our business plan
contemplates the introduction of services using new technologies. Cablecom and
the operations in which we have an interest in France, Germany and Sweden intend
to introduce voice over Internet protocol, or VoIP, voice telephony services
across their networks. Customer demand for this service is uncertain as
customers may not readily switch from their current telephony service,
especially if the quality of the service is not or is perceived not to be
comparable to other telephony services. Similarly, our investments in other new
services such as those related to the 3G mobile network may prove premature and
we may not realize anticipated returns on these new products. The cost of
implementation for emerging and future technologies could be significant, and
our ability to fund such implementation may depend on our ability to obtain
additional financing. We cannot be certain that we would be successful in
obtaining any additional financing required.

WE DO NOT INSURE THE UNDERGROUND PORTION OF OUR CABLE NETWORK.

     We obtain insurance of the type and in the amounts that we believe are
customary for similar companies. Consistent with this practice, we do not insure
the underground portion of our cable network. Substantially all of our cable
network is constructed underground. Any catastrophe that affects our underground
cable network could result in substantial uninsured losses.

WE ARE SUBJECT TO CURRENCY RISK BECAUSE WE OBTAIN A SUBSTANTIAL AMOUNT OF
FINANCING IN U.S. DOLLARS AND EURO BUT GENERALLY GENERATE REVENUES AND INCUR
EXPENSES IN OTHER CURRENCIES.

     We encounter currency exchange rate risks because we generate revenues and
incur construction and operating expenses in other currencies, primarily in
pounds sterling while we pay interest and principal obligations with respect to
most of our existing indebtedness in U.S. dollars and Euro. We cannot assure you
that the hedging transactions we have entered into or any other hedging
transactions we might enter into will be successful or that shifts in the
currency exchange rates will not have a material adverse effect on us. For
example, to the extent that the pound sterling declines in value against the
U.S. dollar and, to a lesser extent, the Euro, and we have not fully hedged
against such declines, the effective cost of servicing our U.S. dollar and Euro
debt will be higher and we will incur currency losses.

WE CURRENTLY DO NOT HAVE SURPLUS AVAILABLE UNDER DELAWARE LAW TO PAY DIVIDENDS
ON OR TO REDEEM OUR CAPITAL STOCK.

     Under Delaware law, unless a corporation has available surplus it cannot
pay dividends on or redeem its capital stock, including its preferred stock. As
of and for the year ended December 31, 2001, we have written down the carrying
value of some of our assets, particularly goodwill. This write down has left us
without available surplus under Delaware law and means that we will be unable to
pay dividends on or redeem any of our capital stock, including our preferred
stock, until such time as we again have available surplus. If dividends remain
unpaid for six quarters on certain series of our preferred stock, then the
holders of each such series shall have the right to vote separately as a class
on all matters voted on by NTL Incorporated shareholders and shall have the
right, along with other holders of preferred stock with similar default voting
rights, to elect two directors to our board. Similarly, if we fail to redeem the
Noos preferred stock on May 18, 2002 as we expect, the holders of such Noos
preferred stock will have the right, along with other holders of preferred stock
with similar default voting rights, to elect two directors to our board and
shall have the right to vote separately as a class, on all matters brought to
NTL Incorporated shareholders.
                                        61
<PAGE>

     We have never paid cash dividends on our common stock. In addition, the
payment of any dividends by us in the future will be at the discretion of our
board of directors and will depend upon, among other things, future earnings,
operations, capital requirements, our general financial condition and the
general financial condition of our subsidiaries.

     Furthermore, the indentures governing NTL Communications Corp.'s
non-convertible senior notes and the indentures governing the outstanding notes
issued by Diamond and NTL Triangle impose limitations on the payment of
dividends to us and consequently limit amounts available for us to pay dividends
on our common stock. Further, the terms of our subsidiaries' senior credit
facilities and working capital facilities restrict, and the terms of other
future indebtedness of our subsidiaries may generally restrict the ability of
some of our subsidiaries to distribute earnings to NTL Incorporated or make
other payments to NTL Incorporated. The terms of Cablecom's credit facilities
also restrict the ability of Cablecom to distribute earnings and make other
payments to NTL Incorporated.

SOME PROVISIONS OF THE AGREEMENTS GOVERNING OUR INDEBTEDNESS AND THE
INDEBTEDNESS OF OUR SUBSIDIARIES AND CERTAIN PROVISIONS OF NTL INCORPORATED'S
CERTIFICATE OF INCORPORATION COULD DELAY OR PREVENT TRANSACTIONS INVOLVING A
CHANGE OF CONTROL OF NTL.

     Provisions of the agreements governing our outstanding indebtedness and the
indebtedness of our subsidiaries, which either require such indebtedness to be
repaid or give the holder the option to require repayment, could have the effect
of delaying or preventing transactions involving a change of control of NTL and
its subsidiaries, including transactions in which stockholders might otherwise
receive a substantial premium for their shares over then current market prices,
and may limit the ability of stockholders of NTL Incorporated to approve
transactions that they may deem to be in their best interest.

     Our certificate of incorporation contains provisions which may have the
effect, alone or in combination with each other or with the existence of
authorized but unissued common stock and preferred stock, of preventing or
making more difficult transactions involving a change of control of NTL.

     Our stockholder rights plan has a significant anti-takeover effect. As a
result, no change of control of NTL Incorporated requiring stockholder approval
is possible without the consent of the owners of that preferred stock.

NTL INCORPORATED, NTL DELAWARE, NTL COMMUNICATIONS CORP., DIAMOND AND NTL
TRIANGLE ARE HOLDING COMPANIES THAT ARE DEPENDENT UPON RECEIPT OF SUFFICIENT
FUNDS FROM THEIR SUBSIDIARIES OR PARENT COMPANIES TO MEET THEIR
OBLIGATIONS -- THEIR ABILITY TO ACCESS THAT CASH FLOW MAY BE LIMITED IN SOME
CIRCUMSTANCES.

     NTL Incorporated, NTL Delaware, NTL Communications Corp., Diamond Cable
Communications and Diamond Holdings and NTL Triangle are holding companies with
no independent operations or significant assets other than investments in and
advances to their respective subsidiaries and affiliated joint ventures. Each of
these companies depends upon the receipt of sufficient funds from their
subsidiaries or their respective parent companies to meet their respective
obligations. The terms of existing and future indebtedness of their respective
subsidiaries and the laws of the jurisdictions under which those subsidiaries
are organized generally limit the payment of dividends, loan repayments and
other distributions to them, subject in some cases to exceptions that allow them
to service indebtedness in the absence of specified defaults.

OUR COMMON STOCK HAS BEEN SUSPENDED FROM THE NEW YORK STOCK EXCHANGE DUE TO THE
FAILURE TO MEET THE $1 AVERAGE CLOSING PRICE REQUIREMENT AND THE MINIMUM MARKET
CAPITALIZATION REQUIREMENTS; THERE MAY NOT BE A LIQUID MARKET FOR OUR COMMON
STOCK AND OUR COMMON STOCK COULD BE A "PENNY STOCK" AS THAT TERM IS DEFINED IN
THE EXCHANGE ACT

     On March 28, 2002, our common stock was suspended from trading on the NYSE
pending delisting due to the low trading price and low market capitalization
relative to the NYSE requirements. The stock last traded on the NYSE on March
26, 2002 at a price of $0.20. Our common stock began trading on the over-the-
counter bulletin board effective April 1, 2002 under the symbol "NTLD". However,
there can be no assurance that a liquid market will develop for our common stock
on the OTC bulletin board.
                                        62
<PAGE>

     Furthermore, as a result of our suspension from the New York Stock
Exchange, our common stock could be a "penny stock" as that term is defined in
the Exchange Act. Brokers effecting transactions in a "penny stock" are subject
to additional customer disclosure and record keeping obligations including
disclosure of the risks associated with low price stocks, stock quote
information and broker compensation. In addition, brokers effecting transactions
in a "penny stock" are also subject to additional sales practice requirements
under Rule 15g-9 of the Exchange Act including making inquiries into the
suitability of "penny stock" investments for each customer or obtaining a prior
written agreement for the specific "penny stock" purchase. Because of these
additional obligations, some brokers will not effect transactions in "penny
stocks", which could have an adverse effect on the liquidity of the security and
make buying or selling it more difficult.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The consolidated financial statements of the Company are filed under this
Item commencing on page F-1 of this Report.

     The following is a summary of the quarterly results of operations for the
years ended December 31, 2001 and 2000.

<Table>
<Caption>
                                                             2001(1)
                                        --------------------------------------------------
                                                        THREE MONTHS ENDED
                                        --------------------------------------------------
                                        MARCH 31     JUNE 30    SEPTEMBER 30   DECEMBER 31
                                        ---------   ---------   ------------   -----------
                                               (IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                     <C>         <C>         <C>            <C>
Revenues..............................  $   894.8   $   899.2    $   928.0     $    977.2
Operating (loss)......................     (658.3)     (682.8)      (635.8)      (9,967.1)
Net (loss)............................   (1,042.9)    1,029.2)    (1,031.5)     (11,137.7)
Basic and diluted net (loss) per
  common share........................      (4.04)      (4.00)       (4.05)        (40.61)
</Table>

<Table>
<Caption>
                                                             2000(2)
                                        --------------------------------------------------
                                                        THREE MONTHS ENDED
                                        --------------------------------------------------
                                        MARCH 31     JUNE 30    SEPTEMBER 30   DECEMBER 31
                                        ---------   ---------   ------------   -----------
                                               (IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                     <C>         <C>         <C>            <C>
Revenues..............................  $   490.9   $   666.3    $   830.7     $    852.9
Operating (loss)......................     (191.1)     (330.4)      (525.8)        (871.6)
Net (loss)............................     (397.7)     (616.5)      (770.3)      (1,179.2)
Basic and diluted net (loss) per
  common share........................      (3.02)      (3.57)       (3.08)         (4.57)
</Table>

---------------

(1) In the fourth quarter of 2001, the Company recorded asset impairments
    totaling $9,511.3 million including goodwill of $8,840.5 million, license
    acquisition costs of $58.8 million, customer lists of $9.1 million, other
    intangibles of $14.9 million, investments in affiliates of $463.7 million
    and other assets of $124.3 million. In addition, in 2001 the Company
    recorded restructuring costs of $209.6 million, integration and consulting
    costs of $102.1 million and losses on the 1G transaction and the sale of the
    ConsumerCo off-net indirect access customers of $147.4 million.

(2) In March 2000, the Company purchased Cablecom for an aggregate purchase
    price of $3,528.7 million, including intangibles of $2,355.3 million. In May
    2000, the Company purchased ConsumerCo for an aggregate purchase price of
    $13,111.0 million, including intangibles of $8,879.0 million. The net assets
    and results of operations of Cablecom and ConsumerCo are included in the
    consolidated financial statements from their respective dates of
    acquisition.

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<PAGE>

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

     Not applicable.

                                    PART III

ITEMS 10, 11 AND 12

     The information required by Items 10, 11, and 12 of PART III are
incorporated by reference to the Company's Annual Report on Form 10-K/A which
was filed on April 30, 2002.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

NTL'S RELATIONSHIP WITH CORECOMM HOLDCO AND CORECOMM LIMITED

     NTL Incorporated and CoreComm Holdco have several overlapping directors and
officers. Barclay Knapp, currently CoreComm Holdco's Chairman, is also the
President, Chief Executive Officer and a director of NTL and a director of
Bredbandsbolaget, a Swedish company in which NTL holds a 34% interest. Gregg N.
Gorelick, currently CoreComm Holdco's Senior Vice President -- Controller and
Treasurer, is also a Vice President and Controller at NTL. George S. Blumenthal,
currently CoreComm Holdco's Chairman Emeritus, is also Chairman, Treasurer and a
director of NTL. Each of Alan J. Patricof and Warren Potash serves as a director
of both CoreComm Holdco and NTL.

     CoreComm Limited was the parent company of CoreComm Holdco until December
2001.

     CoreComm Holdco shares resources with NTL related specifically to corporate
activity, including corporate employees and a corporate office. In conjunction
with these arrangements, NTL provides CoreComm Holdco with management,
financial, legal and administrative support services through the use of
employees, as well as access to office space and equipment and use of supplies
and related office services. Approximately 7 NTL employees provided services to
CoreComm Limited and to CoreComm Holdco in 2001. The salaries of these employees
are charged to CoreComm Holdco by NTL based on the allocations of their time
spent providing services to CoreComm Holdco. Amounts charged to CoreComm Holdco
by NTL consist of direct costs allocated to CoreComm Holdco where identifiable
and a percentage of the portion of NTL's corporate overhead which cannot be
specifically allocated to NTL. Effective January 1, 2001, the percentage used to
allocate corporate overhead was reduced. NTL's charges to CoreComm Holdco
commenced in October 1998. It is not practicable to determine the amounts of
these expenses that would have been incurred had CoreComm Holdco operated as an
unaffiliated entity. In the opinion of management, this allocation method is
reasonable. For the years ended December 31, 2001, 2000 and 1999, NTL charged
CoreComm Holdco $446,000, $1,186,000 and $2,330,000, respectively, which reduced
corporate expenses.

     As part of these arrangements, at a separate office location, CoreComm
Holdco provided NTL with access to office space and equipment and the use of
supplies until August 2001, at which time this office was vacated. In the fourth
quarter of 1999, CoreComm Holdco began charging NTL a percentage of its office
rent and supplies expense. It is not practicable to determine the amounts of
these expenses that would have been incurred had CoreComm Holdco operated as an
unaffiliated entity. In the opinion of management, this allocation method is
reasonable. For the years ended December 31, 2001, 2000 and 1999, CoreComm
Holdco charged NTL $121,000, $267,000 and $62,000 respectively, which is
included in corporate expenses.

     On April 12, 2001, the Company purchased $15.0 million of an unsecured
convertible note from CoreComm and received warrants to purchase 770,000 shares
of CoreComm common stock at an exercise price of $.01 per share that expire in
April 2011. In addition, concurrently with the note purchase and without
additional compensation, the Company entered into a network and software
agreement with CoreComm. Under the agreement, CoreComm will provide U.S. network
access for Internet traffic from the Company's UK customers for three years, as
well as a royalty free license to use certain billing and provisioning software
and know-how. Interest on the notes is at 10.75% per annum, payable semiannually
beginning on October 15, 2001. The interest is payable in kind by the issuance
of additional notes in such principal amount equal to the

                                        64
<PAGE>

interest payment that is then due. The notes are convertible into CoreComm
common stock prior to maturity at a conversion price of $1.00 per share, subject
to adjustment. Additional notes issued for interest will have an initial
conversion price equal to 120% of the weighted average closing price of CoreComm
common stock for a specified period. The Company and CoreComm have agreed to
certain modifications to the conversion feature in connection with CoreComm's
recapitalization in December 2001. In the light of the relationship between the
companies, as described above, the independent directors of the Company examined
the transaction with CoreComm and the Board of Directors of the Company
determined that the transaction was inherently fair to the Company and provided
the Company with benefits that exceeded those that could be obtained from a
third party.

     The Company obtains billing and software development services from
CoreComm. CoreComm billed the Company $3.4 million, $5.9 million and $4.6
million in 2001, 2000 and 1999, respectively, for these services.

     In 2001, the Company and CoreComm entered into a license agreement whereby
the Company was granted an exclusive, irrevocable, perpetual license to billing
software developed by CoreComm for telephony rating, digital television events
rating, fraud management and other tasks. The sales price was cash of $9.8
million for the development costs expended by CoreComm plus a fixed amount of
$3.0 million representing the one-time perpetual license fee. The billing
software was being used by the Company at the time of this agreement, and was
being maintained and modified by CoreComm under an ongoing software maintenance
and development outsourcing arrangement between the companies.

     In March 2000, the Company and CoreComm announced that they had entered
into an agreement to link their networks in order to create an international
Internet backbone that commenced operations in February 2001. The Company
incurred costs of $0.3 million for network usage in the year ended December 31,
2001.

     At December 31, 2001 and 2000, the Company had a receivable from CoreComm
of $1.1 million and a payable to CoreComm of $17.1 million, respectively. The
2000 payable balance primarily related to services and other charges billed in
advance in October and November 2000 of $15.8 million.

NTL'S RELATIONSHIP WITH CCII AND CCPR

     In 1999, the Company provided management, financial, legal and technical
services to Cellular Communications International, Inc. ("CCII") and Cellular
Communications of Puerto Rico, Inc. ("CCPR"). Certain officers and directors of
the Company were officers and directors of CCII and CCPR. In 1999, the Company
charged CCPR and CCII $0.7 million and $0.4 million, respectively, for direct
costs where identifiable and a fixed percentage of its corporate overhead.
Charges to CCPR and to CCII ceased in 1999 due to each of them being acquired
and the resulting termination of services. It is not practicable to determine
the amounts of these expenses that would have been incurred had the Company
operated as an unaffiliated entity. In the opinion of management of the Company,
the allocation methods are reasonable and are as favourable to NTL as could be
obtained with an unrelated third party.

NTL'S RELATIONSHIP WITH FRANCE TELECOM

     On November 1, 2001, we announced that we had entered into an agreement
dated September 28, 2001, with Orange plc for the provision of a new mobile
phone service for NTL's existing and prospective residential customers across
the UK. France Telecom, one of our principal holders of common stock and a
holder of our 5% cumulative preferred stock, acquired Orange plc in August 2001.
Prior to France Telecom's acquisition, our broadcast division provided Orange
with sight leasing services and continues to do so. In the opinion of
management, the terms of the agreements Orange plc are as favourable to NTL as
would have been obtained with a third party unaffiliated with France Telecom.

                                        65
<PAGE>

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (a)(1) Financial Statements -- See list of Financial Statements on page
F-1.

        (2) Financial Statement Schedules -- see list of Financial Statement
Schedules on page F-1.

        (3) Exhibits -- See Exhibit Index on page 57.

     (b) During the fourth quarter of 2001, the Company filed the following
Current Reports on Form 8-K:

          (i) Report dated October 3, 2001 (filed October 4, 2001) reporting
     under Item 5, Other Events, that NTL Incorporated issued a press release
     announcing the successful completion of $250 million vendor financing and
     $294 million GE Capital facilities.

          (ii) Report dated October 29, 2001 (filed October 29, 2001) reporting
     under Item 5, Other Events, that NTL Incorporated issued a press release
     inviting the general public to its 3rd Quarter 2001 financial results
     conference call.

          (iii) Report dated November 7, 2001 (filed November 7, 2001) reporting
     under Item 5, Other Events, that NTL Incorporated announced financial
     results for three and nine months ended September 30, 2001.

          (iv) Report dated November 26, 2001 (filed November 26, 2001)
     reporting under Item 5, Other Events, that NTL Incorporated issued a press
     release announcing the merger of its 1G operations in France with Noos, the
     leading French broadband communications company.

          (v) Report dated December 10, 2001 (filed December 10, 2001) reporting
     under Item 5, Other Events, that NTL Incorporated issued a press release
     announcing a series of cost cutting initiatives.

          (vi) Report dated December 18, 2001 (filed December 18, 2001)
     reporting under Item 5, Other Events, that NTL Incorporated issued a press
     release announcing the continuation of strategic discussions regarding its
     broadcast and Continental Europe operations.

     (c) Exhibits -- The response to this portion of Item 14 is submitted as a
separate section of this report.

     (d) Financial Statement Schedules -- See list of Financial Statement
Schedules on page F-1.

                                        66
<PAGE>

                                 EXHIBIT INDEX

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 2.1       Agreement and Plan of Merger, dated as of February 9, 2000,
           by and among NTL Incorporated, NTL Communications Corp. and
           Holdings Merger Sub Inc. (Incorporated by reference to
           Exhibit 2.1 to Amendment No. 1 to the Registration Statement
           on Form S-3/A, filed by NTL (Delaware), Inc. and NTL
           Incorporated on July 14, 2000, File No. 333-36434)
 2.2       Agreement and Plan of Merger, dated as of March 26, 1999, by
           and among the Company, NTL Communications and NTL Merger
           Inc.(Incorporated by reference to Exhibit 2.1 to Amendment
           No. 2 to the Registration Statement on Form S-3/A, filed by
           NTL Incorporated and NTL Communications Corp. on June 3,
           1999, File No. 333-72335)
 2.3       Agreement and Plan of Amalgamation, dated as of February 4,
           1998, as amended, by and among the Company, NTL (Bermuda)
           Limited, and Comcast UK Cable Partners Limited (Incorporated
           by reference to the Registration Statement on Form S-4,
           filed by NTL Incorporated on September 30, 1998, File No.
           333-64727)
 2.4       Amendment No. 1 to Agreement and Plan of Amalgamation, dated
           as of May 28, 1998, by and among the Company, NTL (Bermuda)
           Limited and Comcast UK Cable Partners Limited (Incorporated
           by reference to Annex B to the Registration Statement on
           Form S-4, filed by NTL Incorporated on September 30, 1998,
           File No. 333-64727)
 2.5       Share Exchange Agreement, dated as of June 16, 1998, as
           amended, by and among the Company and the shareholders of
           Diamond Cable Communications plc (Incorporated by reference
           to Annex A to the Proxy Statement, filed by NTL Incorporated
           on January 29, 1999, File No. 000-22616)
 2.6       Amendment No. 1 to Share Exchange Agreement, dated as of
           December 21, 1998, by and among the Company and the
           shareholders of Diamond Cable Communications plc
           (Incorporated by reference to Exhibit 99.1 to Form 8-K,
           filed by NTL Incorporated on December 23, 1998, File No.
           000-22616)
 2.7       Transaction Agreement, dated as of July 26, 1999, by and
           among, Bell Atlantic Corporation, Cable and Wireless PLC,
           Cable, Wireless Communications PLC and NTL Incorporated
           (Incorporated by reference to Annex J to the Proxy
           Statement, filed by NTL Incorporated on February 11, 2000,
           File No. 000-25691)
 2.8       Investment Agreement, dated as of July 26, 1999, by and
           between, NTL Incorporated and France Telecom S.A.
           (Incorporated by reference to Annex A the Proxy Statement,
           filed by NTL Incorporated on February 11, 2000, File No.
           000-25691)
 2.8(a)    Amendment No. 1 to the Investment Agreement, dated as of
           August 6, 1999 by and among NTL Incorporated and France
           Telecom S.A.(Incorporated by reference Annex B to the Proxy
           Statement, filed by NTL Incorporated on February 11, 2000,
           File No. 000-25691)
 2.8(b)    Amendment No. 2 to the Investment Agreement, dated as of
           October 8, 1999 by and among NTL Incorporated and France
           Telecom S.A.(Incorporated by reference to Annex C to the
           Proxy Statement, filed by NTL Incorporated on February 11,
           2000, File No. 000-25691)
 2.9       Purchase Agreement, dated as of February 17, 2000, by and
           between France Telecom, S.A. and NTL Incorporated
           (Incorporated by reference to Exhibit 99.3 to the Form 8-K,
           filed by NTL Incorporated on February 22, 2000, File No.
           000-25691)
 2.10      Transaction Agreement dated as of December 12, 1999 by and
           among Cablecom Holding AG and NTL Incorporated and certain
           other parties thereto (Incorporated by reference to Exhibit
           2.9 to the 1999 Annual Report on Form 10-K, filed by NTL
           Incorporated on March 17, 2000, File No. 000-25691)
 3.1       Restated Certificate of Incorporation of NTL Incorporated
           (Incorporated by reference to Exhibit 3.1 to the 2000 Form
           10-K, filed by NTL Incorporated on March 30, 2001, File No.
           000-30673)
 3.1(a)    Certificate of Designation, filed on May 17, 2001, in
           respect of NTL Incorporated's 6.5% Fixed Coupon Redeemable
           Preferred Stock, Series A (Incorporated by reference to
           Exhibit 3.1 to the Quarterly Report on Form 10-Q, NTL
           Incorporated on August 14, 2001, File No. 001-16183)
</Table>

                                        67
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 3.1(b)    Certificate of Designation, filed on May 17, 2001, in
           respect of NTL Incorporated's Variable Coupon Redeemable
           Preferred Stock, Series A (Incorporated by reference to
           Exhibit 3.1 the Quarterly Report Form 10-Q, NTL Incorporated
           on August 14, 2001, File No. 001-16183)
 3.1(c)    Certificate of Designation, filed on September 12, 2001, in
           respect of NTL Incorporated's Cumulative Convertible
           Preferred Stock, Series A (Incorporated by reference to
           Exhibit 3.1 to the Quarterly Report on Form 10-Q, filed by
           NTL Incorporated on November 14, 2001, File No. 001-16183)
 3.1(d)    Certificate of Correction, filed on September 28, 2001, in
           respect of NTL Incorporated's Cumulative Convertible
           Preferred Stock, Series A (Incorporated by reference to
           Exhibit 3.2 to the Quarterly Report on Form 10-Q, filed by
           NTL Incorporated on November 14, 2001, File No. 001-16183)
 3.1(e)    Certificate of Elimination, filed November 20, 2001, in
           respect of NTL Incorporated's 9.9% Mandatorily Redeemable
           Preferred Stock, Series B*
 3.1(f)    Certificate of Elimination, filed on November 20, 2001, in
           respect of NTL Incorporated's 5% Cumulative Preferred Stock,
           Series A*
 3.1(g)    Certificate of Designation, filed on January 2, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series H*
 3.1(h)    Certificate of Designation, filed on January 2, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series B-3*
 3.1(i)    Certificate of Designation, filed on April 2, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series I*
 3.1(j)    Certificate of Designation, filed on April 2, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series B-4*
 3.1(k)    Certificate of Correction, filed on June 18, 2001, in
           respect of NTL Incorporated's Variable Coupon Redeemable
           Preferred Stock, Series A*
 3.1(l)    Certificate of Designation, filed on July 2, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series J*
 3.1(m)    Certificate of Designation, filed on July 2, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series B-5*
 3.1(n)    Certificate of Designation, filed on October 1, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series K*
 3.1(o)    Certificate of Designation, filed on October 1, 2001, in
           respect of NTL Incorporated's 5% Cumulative Participating
           Convertible Preferred Stock, Series B-6*
 3.2       By-Laws of NTL Incorporated (Incorporated by reference to
           Exhibit 3.4 to Amendment No. 1 to the Registration Statement
           on Form S-3/A, filed by NTL Communications Corp. on June 3,
           1999, File No. 333-72335)
 4.1       Specimen of Common Stock Certificate (Incorporated by
           reference to Exhibit 4.2 to Amendment No. 2 to the
           Registration Statement on Form S-1/A, filed by International
           Cabletel Inc. on September 9, 1993, File No. 33-63692)
 4.2       Form of Indenture, dated as of September 28, 1994, by and
           between Diamond Cable Communications plc, and The Bank of
           New York as Trustee, with respect to the 13 1/4% Senior
           Discount Notes due September 30, 2004 (Incorporated by
           reference to Exhibit 4.1 to the Registration Statement on
           Form S-1, filed by Diamond Cable Communications plc on
           September 6, 1994, File No. 33-83740)
 4.3       First Supplemental Indenture, dated as of May 31, 1996, by
           and between Diamond Cable Communications plc and The Bank of
           New York as Trustee (Incorporated by reference to Exhibit
           4.3 to Post-Effective Amendment No. 4 to the Registration
           Statement on Form S-1, filed by Diamond Cable Communications
           plc on September 12, 1996, File No. 33-83740)
</Table>

                                        68
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 4.4       Indenture, dated as of April 20, 1995, by and between NTL
           Communications Corp. and Chemical Bank as Trustee, with
           respect to the 12 3/4% Senior Notes (Incorporated by
           reference to Exhibit 4.1 to the Registration Statement on
           Form S-4, filed by International CableTel Incorporated on
           May 26, 1995, File No. 33-92794)
 4.5       First Supplemental Indenture, dated as of January 22, 1996,
           by and between NTL Communications Corp. and Chemical Bank,
           as Trustee, with respect to the 12 3/4% Senior Notes
           (Incorporated by reference to Exhibit 4.5 to the
           Registration Statement on Form S-4, filed by International
           CabelTel Incorporated on February 5, 1996, File No.
           333-1010)
 4.6       Indenture, dated as of November 11, 1995, by and between
           Comcast UK Cable Partners Limited and Bank of Montreal Trust
           Company as Trustee with respect to the 11.20% Senior
           Discount Debentures due 2007 (Incorporated by reference to
           Exhibit 4.1 to Amendment No. 2 to the Registration Statement
           on Form S-1/A filed by Comcast UK Cable Partners Limited on
           November 5, 1995, File No. 33-96932)
 4.7       First Supplemental Indenture, dated October 29, 1998, by and
           between NTL (Bermuda) Limited (now NTL Triangle) LLC) and
           Bank of Montreal Trust Company as Trustee, with respect to
           the 11.20% Senior Discount Debentures due 2007 (Incorporated
           by reference to Exhibit 4.1 to Form 8-K, filed by NTL
           (Triangle) LLC on November 4, 1998, File No. 000-24792)
 4.8       Indenture, dated as of December 15, 1995, by and between
           Diamond Cable Communications plc, and The Bank of New York
           as Trustee, with respect to the 11 3/4% Senior Discount
           Notes due December 15, 2005 (Incorporated by reference to
           Exhibit 4.1 to Amendment No. 2 to the Registration Statement
           on Form S-1/A, filed by Diamond Cable Communications plc on
           December 6, 1995, File No. 33-98374)
 4.9       Indenture, dated as of January 30, 1996, by and between NTL
           Communications and Chemical Bank as Trustee, with respect to
           the 11 1/2% Senior Notes due 2006 (Incorporated by reference
           to Exhibit 4.1 to the Registration Statement on Form S-4,
           filed by International CabelTel Incorporated on February 5,
           1996, File No. 333-1010)
 4.10      Indenture, date as of February 12, 1997, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 10% Senior Notes (Incorporated
           by reference to Exhibit 4.9 to the 1996 Annual Report on
           Form 10-K, filed by NTL Incorporated on March 28, 1997, File
           No. 000-22616)
 4.11      Indenture, dated as of February 27, 1997, by and between
           Diamond Cable Communications plc and The Bank of New York as
           Trustee, with respect to the 10 3/4% Senior Discount Notes
           due February 15, 2007 (Incorporated by reference to Exhibit
           4.1 to the Registration Statement on Form S-4, filed by
           Diamond Cable Communications plc on April 15, 1997, File No.
           333-25193)
 4.12      Indenture, dated as of February 6, 1998, by and among
           Diamond Holdings plc, Diamond Cable Communications plc, and
           The Bank of New York as Trustee, with respect to the 10%
           Senior Notes due February 1, 2008 and 9 1/8% Senior Notes
           due February 1, 2008 (Incorporated by reference to Exhibit
           4.1 to the Registration Statement on Form S-4, filed by
           Diamond Cable Communications plc on March 20, 1998, File No.
           333-48413)
 4.13      Indenture, dated as of March 13, 1998, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 9 1/2% Senior Notes
           (Incorporated by reference to Exhibit 4.10 to the 1997
           Annual Report on Form 10-K filed by NTL Communications (File
           No. 0-22616) on March 30, 1998)
 4.14      Indenture, date as of March 13, 1998, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 9 3/4% Senior Deferred Coupon
           Notes (Incorporated by reference to Exhibit 4.11 to the 1997
           Annual Report on Form 10-K, filed by NTL Incorporated on
           March 30, 1998, File No. 000-22616)
</Table>

                                        69
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 4.15      Indenture, date as of March 13, 1998, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 10 3/4% Senior Deferred Coupon
           Notes (Incorporated by reference to Exhibit 4.12 to the 1997
           Annual Report on Form 10-K, filed by NTL Incorporated on
           March 30, 1998, File No. 000-22616)
 4.16      Indenture, date as of November 2, 1998, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 11 1/2% Senior Notes due 2008
           (Incorporated by reference to Exhibit 4.13 to the 1998
           Annual Report on Form 10-K, filed by NTL Incorporated on
           March 30, 1999, File No. 000-22616)
 4.17      Indenture, date as of November 6, 1998, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 12 3/8% Senior Deferred Coupon
           Notes due 2008 (Incorporated by reference to Exhibit 4.15 to
           the 1998 Annual Report on Form 10-K, filed by NTL
           Incorporated on March 30, 1999, File No. 000-22616)
 4.18      Indenture, date as of December 16, 1998, by and between NTL
           Communications Corp. and The Chase Manhattan Bank, as
           Trustee, with respect to the 7% Convertible Subordinated
           Notes due 2008 (Incorporated by reference to Exhibit 4.17 to
           the 1998 Annual Report on Form 10-K, filed by NTL
           Incorporated on March 30, 1999, File No. 000-22616)
 4.19      First Supplemental Indenture, date as of March 31, 1999, by
           and among NTL Incorporated, NTL Communications Corp. and The
           Chase Manhattan Bank, as Trustee, with respect to the 7%
           Convertible Subordinated Notes due 2008 (Incorporated by
           reference to Exhibit 4.4 to Amendment No. 2 to the
           Registration Statement on Form S-3/A, filed by NTL
           Incorporated and NTL Communications Corp. on June 3, 1999,
           File No. 333-72335)
 4.20      Second Supplemental Indenture, dated as of March 16, 2000,
           by and among NTL Incorporated, NTL Communications Corp.
           (formerly NTL Incorporated) and The Chase Manhattan Bank as
           Trustee, with respect to the 7% Convertible Subordinated
           Notes due 2008 (Incorporated by reference to Exhibit 4.3 to
           Amendment No. 1 to the Registration Statement on Form S-3/A,
           filed by NTL Incorporated, NTL (Delaware), Inc. and NTL
           Communications Corp. on August 30, 2000, File No. 333-42792)
 4.21      Third Supplemental Indenture, dated as of May 17, 2000, by
           and among NTL Incorporated, NTL Communications Corp.
           (formerly NTL Incorporated) and The Chase Manhattan Bank as
           Trustee, with respect to the 7% Convertible Subordinated
           Notes due 2008 (Incorporated by reference to Exhibit 4.4 to
           Amendment No. 1 to the Registration Statement on Form S-3/A,
           filed by NTL Incorporated, NTL (Delaware), Inc. and NTL
           Communications Corp. on August 30, 2000, File No. 333-42792)
 4.22      Indenture, dated as of April 14, 1999, by and between NTL
           Communications Corp. and The Chase Manhattan Bank as
           Trustee, with respect to the 9 3/4% Senior Deferred Coupon
           Notes due 2009 (Incorporated by reference to Exhibit 4.1 to
           the Registration Statement on Form S-4, filed by NTL
           Communications Corp. on May 13, 1999, File No. 333-78405)
 4.23      Indenture, dated as of November 24, 1999, by and between NTL
           Communications Corp. and The Chase Manhattan Bank as
           Trustee, with respect to the 9 1/4% Senior Notes due 2006
           (Incorporated by reference to Exhibit 4.1 to the
           Registration Statement on Form S-4, filed by NTL
           Communications Corp. on January 24, 2000, File No.
           333-95267)
 4.24      Indenture, dated as of November 24, 1999, by and between NTL
           Communication Corp. and The Chase Manhattan Bank as Trustee,
           with respect to the 9 7/8% Senior Notes Due 2009
           (Incorporated by reference to Exhibit 4.2 to the
           Registration Statement on Form S-4, filed by NTL
           Communication Corp. on January 24, 2000, File No. 333-95267)
 4.25      Indenture, dated as of November 24, 1999, by and between NTL
           Communications Corp. and The Chase Manhattan Bank as
           Trustee, with respect to the 11 1/2% Senior Deferred Coupon
           Notes due 2009 (Incorporated by reference to Exhibit 4.3 to
           the Registration Statement on Form S-4, filed by NTL
           Communications Corp. on January 24, 2000, File No.
           333-95267)
</Table>

                                        70
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 4.26      Indenture, dated as of December 22, 1999, by and between NTL
           Incorporated and The Chase Manhattan Bank as Trustee, with
           respect to the 5 3/4% Convertible Subordinated Notes Due
           2009 (Incorporated by reference to Exhibit 4.28 to the 1999
           Annual Report on Form 10-K, filed by NTL Incorporated on
           March 17, 2000, File No. 000-25691)
 4.27      First Supplemental Indenture, dated as of May 17, 2000, by
           and between NTL Incorporated and The Chase Manhattan Bank as
           Trustee, with respect to the 5 3/4% Convertible Subordinated
           Notes due 2009 (Incorporated by reference to Exhibit 4.2 to
           Amendment No. 1 to the Registration Statement on Form S-3/A,
           filed by NTL (Delaware), Inc. and NTL Incorporated on July
           14, 2000, File No. 333-36434)
 4.28      Indenture, dated as of October 2, 2000, by and between NTL
           Communications Corp. and The Chase Manhattan Bank as
           Trustee, with respect to the 11 7/8% Senior Notes due 2010
           (Incorporated by reference to Exhibit 4.1 to the
           Registration Statement on Form S-4, filed by NTL
           Communications Corp. on October 26, 2000, File No.
           333-48648)
 4.29      Indenture, dated as of January 24, 2001, by and between NTL
           Communications Corp. and The Chase Manhattan Bank as
           Trustee, with respect to the 12 3/8% Senior Notes due 2008
           (Incorporated by reference to Exhibit 4.1 to the
           Registration Statement on Form S-4, filed by NTL
           Communications Corp. on February 9, 2001, File No.
           333-55288)
 4.30      Indenture, dated as of May 15, 2001, by and between NTL
           Communications Corp., NTL Incorporated and The Chase
           Manhattan Bank, as Trustee, with respect to the 6 3/4%
           Convertible Senior Notes due 2008 (Incorporated by reference
           to Exhibit 4.7 to Amendment No. 1 to the Registration
           Statement on Form S-4/A, filed by NTL Communications Corp.
           on June 8, 2001, File No. 333-55288)
 4.31      Indenture, dated as of June 22, 2001 by and between NTL
           Incorporated, NTL (Delaware), Inc. and The Chase Manhattan
           Bank, as Trustee, with respect to the 5 3/4% convertible
           subordinated notes due 2011**
 4.32      First Supplemental Indenture, dated as of July 27, 2001 by
           and among NTL Incorporated, NTL (Delaware), Inc. and The
           Chase Manhattan Bank, as Trustee, with respect to the 5 3/4%
           convertible subordinated notes due 2011**
 4.33      Registration Rights Agreement, dated as of February 2, 2000,
           by and between NTL Incorporated and Bell Atlantic
           Corporation (Incorporated by reference to Annex H to the
           Proxy Statement, filed by NTL Incorporated on February 11,
           2000, File No. 000-25691)
 4.33(a)   Amendment No. 1 to the Registration Rights Agreement, dated
           as of November 30, 2000 by and between NTL Incorporated and
           Verizon Communications Inc. (formerly known as Bell Atlantic
           Corporation) (Incorporated by reference to Exhibit 4.30A to
           the Registration Statement on Form S-3, filed by NTL
           Incorporated and NTL Communications Corp. on July 24, 2001,
           File No. 333-65742)
 4.33(b)   Amendment No. 2 to the Registration Rights Agreement, dated
           as of March 31, 2001 by and between NTL Incorporated and
           Verizon Communications Inc. (formerly known as Bell Atlantic
           Corporation) (Incorporated by reference to Exhibit 4.30B to
           the Registration Statement on Form S-3, filed by NTL
           Incorporated and NTL Communications Corp. on July 24, 2001,
           File No. 333-65742)
 4.33(c)   Amendment No. 3 to the Registration Rights Agreement, dated
           as of June 30, 2001 by and between NTL Incorporated and
           Verizon Communications Inc. (formerly known as Bell Atlantic
           Corporation) (Incorporated by reference to Exhibit 4.30C to
           the Registration Statement on Form S-3, filed by NTL
           Incorporated and NTL Communications Corp. on July 24, 2001,
           File No. 333-65742)
 4.34      Registration Rights Agreement, dated as of February 2, 2000,
           by and between NTL Incorporated and Cable & Wireless plc
           (Incorporated by reference to Annex G to the Proxy
           Statement, filed by NTL Incorporated on February 11, 2000,
           File No. 000-25691)
</Table>

                                        71
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 4.35      Registration Rights Agreement, dated as of May 30, 2000, by
           and between NTL Incorporated and France Telecom, with
           respect to the 5% Cumulative Participating Convertible
           Preferred Stock Series A (Incorporated by reference to
           Exhibit 4.33 to the 2000 Annual Report on Form 10-K, filed
           by NTL Incorporated on March 30, 2001, File No. 001-16183)
 4.36      Registration Rights Agreement dated as of May 15, 2001 by
           and among NTL Communications Corp., NTL Incorporated, Morgan
           Stanley & Co. Incorporated, J.P. Morgan Securities Inc.,
           Credit Suisse First Boston Corporation and Salomon Smith
           Barney Inc. with respect to the 6 3/4% Convertible Senior
           Notes due 2008 (Incorporated by reference to Exhibit 4.8 to
           Amendment No. 1 to the Registration Statement on Form S-4/A,
           filed by NTL Communications Corp. on June 8, 2001, File No.
           333-55288)
 4.37      Registration Rights Agreement dated as of June 22, 2001 by
           and among NTL Incorporated, NTL (Delaware), Inc. and SFG VI
           Inc. with respect to shares of common stock issuable upon
           conversion of the 5 3/4% Convertible Notes due 2011
           (Incorporated by reference to Exhibit 4.40 to the
           Registration Statement on Form S-3, filed by NTL
           Incorporated on July 24, 2001, File No. 333-65744)
 4.38      Form of Preferred Stock (Incorporated by reference to
           Exhibit 4.13 to the 1996 Annual Report on Form 10-K, filed
           by NTL Incorporated on March 28, 1997, File No. 000-22616)
 4.39      Rights Agreement, dated as of September, 1993, by and
           between NTL Incorporated and Continental Stock Transfer &
           Trust Company (Incorporated by reference to Exhibit 4.2 to
           Amendment No. 1 to the Registration Statement of Form S-1,
           filed by International CableTel, Inc. on August 11, 1993,
           File No. 33-63570)
 4.39(a)   Amendment No. 1 to the Rights Agreement, dated as of March
           31, 1999, by and between NTL Incorporated and Continental
           Stock Transfer & Trust Company, as Rights Agent
           (Incorporated by reference to Exhibit 4.4 to the
           Registration Statement on Form S-8, filed by NTL
           Incorporated on April 20, 1999, File No. 333-76601)
 4.39(b)   Amendment No. 2 to the Rights Agreement, dated as of October
           23, 1999, by and between NTL Incorporated and Continental
           Stock Transfer & Trust Company, as Rights Agent
           (Incorporated by reference to Exhibit 4.48B to the 1999
           Annual Report on Form 10-K, Incorporated, filed by NTL
           Incorporated on March 17, 2000, File No. 000-25691)
 4.39(c)   Amendment No. 3 to the Rights Agreement, dated as of March
           28, 2000, by and between NTL Incorporated and Continental
           Stock Transfer & Trust Company, as Rights Agent
           (Incorporated by reference to Exhibit 4.34.C to the 2000
           Annual Report on Form 10-K, filed by NTL Incorporated on
           March 30, 2001, File No. 001-16183)
 4.39(d)   Amendment No. 4 to the Rights Agreement, dated as of May 17,
           2000, by and between NTL Incorporated and Continental Stock
           Transfer & Trust Company, as Rights Agent (Incorporated by
           reference to Exhibit 4.34.D to the 2000 Annual Report on
           Form 10-K filed by NTL Incorporated on March 30, 2001, File
           No. 001-16183)
 4.39(e)   Amendment No. 5 to the Rights Agreement, dated as of May 25,
           2000, by and between Incorporated and Continental Stock
           Transfer & Trust Company, as Rights Agent (Incorporated by
           reference to Exhibit 4.34.E to the 2000 Annual Report on
           Form 10-K, filed by NTL Incorporated on March 30, 2001, File
           No. 001-16183)
 4.39(f)   Amendment to Amendment No. 3 to the Rights Agreement, dated
           as of September 12, 2001, by and between NTL Incorporated
           and Continental Stock Transfer & Trust Company, as Rights
           Agent (Incorporated by reference Exhibit 4.1 to the
           Quarterly Report on Form 10-Q, filed by NTL Incorporated on
           November 14, 2001, File No. 000-30673)
 4.40      Exchange Agreement, dated as of September 12, 2001, by and
           among the Company and France Telecom S.A. and the other
           parties thereto (Incorporated by reference to Exhibit 4.2 to
           the Quarterly Report on Form 10-Q, filed by NTL Incorporated
           on November 14, 2001, File No. 001-16183)
</Table>

                                        72
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
 4.41      Deposit Agreement, dated as of June 22, 2001, by and among
           NTL Incorporation, NTL (Delaware), Inc. and United States
           Trust Company of New York, as depositary (Incorporated by
           reference to Exhibit 4.29 to Amendment 1 to the Registration
           Statement on Form S-3/A, filed by NTL Incorporated on August
           16, 2001, File No. 333-65744)
10.1       Compensation Plan and Agreements, as amended and restated
           effective June 3, 1997 (Incorporated by reference to Exhibit
           10.1 to the 1997 Annual Report on Form 10-K, filed by NTL
           Communications on March 30, 1998, File No. 0-22616)
10.2       Rules of the NTL Sharesave Plan, adopted by NTL Incorporated
           on October 28, 1997 (Incorporated by reference to Exhibit
           10.2 to the 1998 Annual Report on Form 10-K, filed by NTL
           Communications, on March 30, 1999, File No. 0-22616)
10.3       Form of Director and Officer Indemnity Agreement (together
           with a schedule of executed Indemnity Agreements)
           (Incorporated by reference to Exhibit 10.3 to the 1999
           Annual Report on Form 10-K, filed by NTL Incorporated on
           March 17, 2000, File No. 000-25691)
10.4       1998 Non-Qualified Stock Option Plan, as Amended and
           Restated October 1998 (Incorporated by reference to Exhibit
           10.4 to the 1998 Annual Report on Form 10-K, filed by NTL
           Communications on March 30, 1999, File No. 0-22616)
10.5       Credit Agreement relating to the acquisition of Cable &
           Wireless Communications (Holdings) PLC, dated as of May 30,
           2000, by and among NTL Communications Limited, NTL Business
           Limited, NTL Communications Corp., Chase Manhattan PLC and
           Morgan Stanley Dean Witter Limited, Chase Manhattan
           International Limited (Incorporated by reference to Exhibit
           10.8 to the 2000 Annual Report on Form 10-K, filed by NTL
           Incorporated on March 30, 2001, File No. 001-16183)
10.6       Restatement Amendment Agreement dated as of September 26,
           2001 by and among NTL Communications Limited, NTL Investment
           Holdings Limited, NTL Communications Corp., J.P. Morgan plc
           and Morgan Stanley Dean Witter Bank Limited, Chase Manhattan
           International Limited and others, agreeing to amend the
           Credit Agreement, dated as of May 30, 2000, between NTL
           Communications Corp., NTL (UK) Group, Inc., NTL
           Communications Limited, Morgan Stanley Dean Witter Bank
           Limited and Chase Manhattan PLC*
10.6(a)    Amended and Restated Credit Agreement dated as of September
           26, 2001, restating the Credit Agreement dated as of 30 May
           2000, as amended or waived pursuant to a letter dated as of
           6 June 2000, amendment agreements dated as of 8 June 2000,
           30 June 2000 and 4 September 2000, a novation agreement
           dated as of 21 February 2001 and letters of consent dated as
           of 22 December 2000 and 29 January 2001 by and among NTL
           Communications Limited, NTL Investment Holdings Limited, NTL
           Communications Corp., J.P. Morgan plc and Morgan Stanley
           Dean Witter Bank Limited, Chase Manhattan International
           Limited and others*
10.7       Credit Agreement dated 28 March 2000, by and among NTL
           Incorporated, NTL Cablecom Holding GmbH, Cablecom
           (Ostschweiz) AG and Chase Manhattan plc and Morgan Stanley
           Senior Funding, Inc., as Arrangers and Joint Book Managers,
           Chase Manhattan International Limited as Agent and Others
           Term, comprising a Loan Facility and a Revolving Credit
           Facility (Incorporated by reference to Exhibit 10.4 to the
           Registration Statement on Form S-3, filed by NTL
           Incorporated and NTL Communications Corp. on July 24, 2001,
           File No. 333-65742)
10.8       Investment Agreement, dated July 26, 1999, as amended, by
           and between the Company and France telecom S.A (Incorporated
           by reference to Annex A to the proxy statement filed by NTL
           Incorporated on February 11, 2000, File No. 000-25691)
10.8(a)    Amendment, dated as of September 12, 2001, to the Investment
           Agreement, dated July 26, 1999, as amended, by and between
           the Company and France Telecom S.A. (Incorporated by
           reference to Exhibit 10.1 to the Quarterly Report on Form
           10-Q, filed by NTL Incorporated on November 14, 2001, File
           No. 001-16183)
10.9       Framework Agreement For The Provision Of IT Outsourcing
           Services, dated as of May 23, 2001, by and between NTL Group
           Limited and IBM United Kingdom Limited*
</Table>

                                        73
<PAGE>

<Table>
<Caption>
EXHIBIT
  NO.
-------
<C>        <S>
10.10      Amendment, dated as of April 5, 2001 to the Framework
           Agreement For The Provision of IT Outsourcing Services,
           dated as of May 23, 2001, by and between NTL Group Limited
           and IBM United Kingdom Limited*
10.11      Consent Letter, dated as of March 8, 2002, in respect of the
           Senior Credit Facility by and among NTL Communications
           Limited, NTL Investment Holdings Limited, NTL Communications
           Corp. and J.P. Morgan Europe Limited, on behalf of the
           lenders thereto*
10.12      Consent Letter, dated as of March 8, 2002, in respect of the
           Working Capital Facility by and among NTL Communications
           Corp., NTL Communications Limited, NTL (UK) Group Inc. and
           J.P. Morgan Europe Limited, on behalf of the lenders
           thereto*
10.13      Consent Letter, dated as of March 8, 2002, in respect of the
           Cablecom Credit Facility by and among NTL (Delaware), Inc.,
           NTL Cablecom GmbH and subsidiaries and J.P. Morgan Europe
           Limited, on behalf of the lenders thereto*
10.14      Consent Letter, dated as of March 28, 2002, in respect of
           the Senior Credit Facility by and among NTL Communications
           Limited, NTL Investment Holdings, NTL Communications
           Corporation and J.P. Morgan Europe Limited, on behalf of the
           lenders thereto*
10.15      Consent Letter, dated March 28, 2002, in respect of the
           Working Capital Facility by and among NTL Communications
           Corp., NTL Communications Limited, NTL (UK) Group Inc.*
10.16      Consent Letter, dated March 28, 2002, in respect of the
           Cablecom Credit Facility by and among NTL (Delaware), Inc.,
           Cablecom GmbH and subsidiaries and J.P. Morgan Europe
           Limited, on behalf of the lenders thereto*
10.17      Share Sale Agreement, dated February 22, 2002, in respect of
           the sale of shares NTL Belgium Sprl Limited, by and among
           National Transcommunications Spain S.L., NTL Australia SPV,
           Inc., Macquarie Communications Infrastructure Holdings Pty
           Limited and NTL Incorporated*
11         Statement Regarding Per Share Earnings of NTL Incorporated*
21         Subsidiaries of the Registrant*
23         Consent of Ernst & Young LLP***
99.1       Certification of Chief Executive Officer and Chief Financial
           Officer pursuant to 18 U.S.C. Section 1350***
</Table>

---------------

  * Filed with the Company's Annual Report on Form 10-K for the year ended
    December 31, 2001, filed on April 16, 2002.

 ** We agree to furnish a copy of such agreement to the Commission upon request.

*** Filed herewith.

                                        74
<PAGE>

     Pursuant to the requirements of Section 13 or 15(d) 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.

                                          NTL INCORPORATED

                                          By:    /s/ GREGG N. GORELICK
                                          --------------------------------------
                                                    Gregg N. Gorelick
                                                Vice President-Controller

Dated: September 19, 2002

                                        75
<PAGE>

                                 CERTIFICATIONS

I, Barclay Knapp, certify that:

1. I have reviewed this annual report on Form 10-K/A of NTL Incorporated;

2. Based on my knowledge, this annual 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 annual report; and

3. Based on my knowledge, the financial statements, and other financial
   information included in this annual 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 annual report.

Date: September 19, 2002

                                                   /s/ BARCLAY KNAPP
                                          --------------------------------------
                                                      Barclay Knapp
                                                 Chief Executive Officer
                                              (Principal Executive Officer)

I, John Gregg, certify that:

1. I have reviewed this annual report on Form 10-K/A of NTL Incorporated;

2. Based on my knowledge, this annual 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 annual report; and

3. Based on my knowledge, the financial statements, and other financial
   information included in this annual 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 annual report.

Date: September 19, 2002

                                                   /s/ JOHN F. GREGG
                                          --------------------------------------
                                                      John F. Gregg
                                                 Chief Financial Officer
                                              (Principal Financial Officer)
<PAGE>

                      FORM 10-K/A -- ITEM 14(a)(1) AND (2)

                       NTL INCORPORATED AND SUBSIDIARIES

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                        AND FINANCIAL STATEMENT SCHEDULE

     The following consolidated financial statements of NTL Incorporated and
Subsidiaries are included in Item 8:

<Table>
<S>                                                           <C>
Report of Independent Auditors..............................  F-2
Consolidated Balance Sheets --
  December 31, 2001 and 2000................................  F-3
Consolidated Statements of Operations --
  Years ended December 31, 2001, 2000 and 1999..............  F-4
Consolidated Statement of Shareholders' Equity (Deficiency)
  Years ended December 31, 2001, 2000 and 1999..............  F-5
Consolidated Statements of Cash Flows --
  Years ended December 31, 2001, 2000 and 1999..............  F-6
Notes to Consolidated Financial Statements..................  F-8
</Table>

     The following consolidated financial statement schedules of NTL
Incorporated and Subsidiaries are included in Item 14(d):

<Table>
<S>                                                           <C>
Schedule I -- Condensed Financial Information of
  Registrant................................................  F-46
Schedule II -- Valuation and Qualifying Accounts............  F-51
</Table>

     All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission are not required
under the related instructions or are inapplicable and, therefore have been
omitted.

                                       F-1
<PAGE>

                         REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Shareholders
NTL Incorporated

     We have audited the consolidated balance sheets of NTL Incorporated and
Subsidiaries as of December 31, 2001 and 2000, and the related consolidated
statements of operations, shareholders' (deficiency) equity and cash flows for
each of the three years in the period ended December 31, 2001. Our audits also
included the financial statement schedules listed in the Index at Item 14(a).
These financial statements and schedules are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements and schedules based on our audits.

     We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
NTL Incorporated and Subsidiaries at December 31, 2001 and 2000, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 2001, in conformity with accounting
principles generally accepted in the United States. Also, in our opinion, the
related financial statement schedules, when considered in relation to the basic
financial statements taken as a whole, present fairly in all material respects
the information set forth therein.

     The accompanying financial statements have been prepared assuming that NTL
Incorporated will continue as a going concern. As more fully described in Note
1, the Company has incurred recurring operating losses and negative operating
cash flows, has a working capital deficiency and a deficiency in shareholders'
equity. The Company's substantial leverage, its current debt and equity trading
levels and its non-compliance with certain debt covenants in 2002 have
eliminated access to the Company's historic sources of capital. The Company has
initiated a recapitalization process, the success of which is dependent upon
adequate liquidity to complete the process as well as agreement of the Company's
creditors and preferred stockholders. These conditions raise substantial doubt
about the Company's ability to continue as a going concern. Management's plans
in regard to these matters are also described in Note 1. The financial
statements do not include any adjustments to reflect the possible future effects
on the recoverability and classification of assets or the amounts and
classification of liabilities that may result from the outcome of this
uncertainty.

                                                 /s/ ERNST & YOUNG LLP

New York, New York
April 16, 2002

                                       F-2
<PAGE>

                       NTL INCORPORATED AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>
                                                                  DECEMBER 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
                                                                  (IN MILLIONS)
<S>                                                           <C>         <C>
                                      ASSETS
Current assets:
  Cash and cash equivalents.................................  $   504.6   $   579.4
  Marketable securities.....................................         --        60.0
  Accounts receivable -- trade, less allowance for doubtful
     accounts of $133.8 (2001) and $141.4 (2000)............      683.3       729.1
  Other.....................................................      365.2       422.9
                                                              ---------   ---------
Total current assets........................................    1,553.1     1,791.4
Fixed assets, net...........................................   12,573.3    12,693.0
Intangible assets, net......................................    1,985.6    13,061.0
Investments in and loans to affiliates, net.................      272.4       333.1
Other assets, net of accumulated amortization of $150.3
  (2001) and $92.3 (2000)...................................      449.8       505.2
                                                              ---------   ---------
Total assets................................................  $16,834.2   $28,383.7
                                                              =========   =========
                 LIABILITIES AND SHAREHOLDERS' (DEFICIENCY) EQUITY
Current liabilities:
  Accounts payable..........................................  $   430.0   $   506.3
  Accrued expenses and other................................    1,013.1     1,280.6
  Accrued construction costs................................      144.8       196.9
  Interest payable..........................................      303.9       151.3
  Deferred revenue..........................................      505.8       492.8
  Current portion of long-term debt.........................   17,666.1        12.6
                                                              ---------   ---------
Total current liabilities...................................   20,063.7     2,640.5
Long-term debt..............................................      102.3    15,044.1
Other.......................................................      176.0        43.1
Commitments and contingent liabilities
Deferred income taxes.......................................      260.9       205.4
Redeemable preferred stock -- $.01 par value, plus accreted
  dividends; liquidation preference $2,834.5; less
  unamortized discount of $53.4 (2001) and $2.5 (2000);
  issued and outstanding 2.1 (2001) and 2.0 (2000) shares...    2,773.7     2,083.2
Shareholders' (deficiency) equity:
  Series preferred stock -- $.01 par value; authorized 10.0
     shares; liquidation preference $3,000.0; issued and
     outstanding 3.0 (2001) and 2.9 (2000) shares...........         --          --
  Common stock -- $.01 par value; authorized 800.0 shares;
     issued and outstanding 276.6 (2001) and 272.1 (2000)
     shares.................................................        2.8         2.7
  Additional paid-in capital................................   13,720.0    13,764.7
  Accumulated other comprehensive (loss)....................   (1,072.8)     (448.9)
  (Deficit).................................................  (19,192.4)   (4,951.1)
                                                              ---------   ---------
                                                               (6,542.4)    8,367.4
                                                              ---------   ---------
Total liabilities and shareholders' (deficiency) equity.....  $16,834.2   $28,383.7
                                                              =========   =========
</Table>

                            See accompanying notes.
                                       F-3
<PAGE>

                       NTL INCORPORATED AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS

<Table>
<Caption>
                                                                    YEAR ENDED DECEMBER 31,
                                                              ------------------------------------
                                                                 2001          2000        1999
                                                              -----------   ----------   ---------
                                                              (IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                                           <C>           <C>          <C>
REVENUES
Consumer telecommunications and television..................  $  2,514.6    $ 1,819.8    $  834.3
Business telecommunications.................................       840.6        702.2       452.5
Broadcast transmission and other............................       344.0        318.8       297.3
                                                              ----------    ---------    --------
                                                                 3,699.2      2,840.8     1,584.1
COSTS AND EXPENSES
Operating expenses (exclusive of depreciation shown
  separately below).........................................     1,809.3      1,387.6       798.6
Selling, general and administrative expenses................     1,181.6      1,109.1       574.6
Asset impairments...........................................     9,072.7           --          --
Franchise fees..............................................          --           --        16.5
Non-cash compensation.......................................        30.6           --          --
Other charges...............................................       311.7         92.7        16.2
Corporate expenses..........................................        66.8         47.5        29.4
Depreciation................................................     1,549.7        996.6       490.3
Amortization................................................     1,620.8      1,126.2       301.0
                                                              ----------    ---------    --------
                                                                15,643.2      4,759.7     2,226.6
                                                              ----------    ---------    --------
Operating (loss)............................................   (11,944.0)    (1,918.9)     (642.5)
OTHER INCOME (EXPENSE)
Interest income and other, net..............................        51.1         72.5        67.8
Interest expense............................................    (1,440.9)    (1,036.8)     (680.7)
Share of (losses) from equity investments...................      (683.2)       (70.9)      (18.4)
Other (losses) gains........................................      (147.4)          --       493.1
Foreign currency transaction (losses) gains.................       (13.7)      (120.6)       12.7
                                                              ----------    ---------    --------
(Loss) before income taxes and extraordinary item...........   (14,178.1)    (3,074.7)     (768.0)
Income tax (expense) benefit................................       (63.2)       111.0        35.3
                                                              ----------    ---------    --------
(Loss) before extraordinary item............................   (14,241.3)    (2,963.7)     (732.7)
Loss from early extinguishment of debt......................          --           --        (3.0)
                                                              ----------    ---------    --------
Net (loss)..................................................   (14,241.3)    (2,963.7)     (735.7)
Preferred stock dividends...................................      (325.7)      (194.0)      (73.7)
                                                              ----------    ---------    --------
Net (loss) available to common shareholders.................  $(14,567.0)   $(3,157.7)   $ (809.4)
                                                              ==========    =========    ========
Basic and diluted net (loss) per common share:
  (Loss) before extraordinary item..........................  $   (52.78)   $  (14.54)   $  (6.75)
  Extraordinary item........................................          --           --       (0.03)
                                                              ----------    ---------    --------
  Net (loss) per common share...............................  $   (52.78)   $  (14.54)   $  (6.78)
                                                              ==========    =========    ========
  Weighted average shares...................................       276.0        217.1       119.4
                                                              ==========    =========    ========
</Table>

                            See accompanying notes.
                                       F-4
<PAGE>

                       NTL INCORPORATED AND SUBSIDIARIES

          CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIENCY)
<Table>
<Caption>

                                               SERIES         COMMON
                                             PREFERRED         STOCK
                                             STOCK $.01      $.01 PAR
                                             PAR VALUE         VALUE       ADDITIONAL
                                            ------------   -------------    PAID-IN     COMPREHENSIVE
                                            SHARES   PAR   SHARES   PAR     CAPITAL         LOSS
                                            ------   ---   ------   ----   ----------   -------------
                                                                  (IN MILLIONS)
<S>                                         <C>      <C>   <C>      <C>    <C>          <C>
Balance, December 31, 1998................    0.2    $--    60.2    $0.6   $ 1,501.6
Exercise of stock options.................                   1.8      --        41.3
Exercise of warrants......................                   0.1      --         0.8
Common stock issued for cash..............                   2.7      --       250.0
Preferred stock issued for cash...........    1.2    --                      1,233.8
Warrants issued for cash..................                                      16.2
Accreted dividends on preferred stock.....                                     (44.1)
Accretion of discount on preferred
  stock...................................                                      (0.3)
Redemption of series preferred stock......   (0.1)   --                       (125.3)
Conversion of 7% Convertible Notes........                   7.3     0.1       269.2
Common stock issued for an acquisition....                  12.7     0.1       971.3
Stock options issued in connection with an
  acquisition.............................                                       6.6
Issuance of warrants......................                                       4.5
Stock splits..............................                  47.6     0.5        (0.5)
Comprehensive loss:
Net loss for the year ended December 31,
  1999....................................                                               $   (735.7)
Currency translation adjustment...........                                                   (106.8)
                                                                                         ----------
    Total.................................                                               $   (842.5)
                                             ----    --    -----    ----   ---------     ----------
Balance, December 31, 1999................    1.3    --    132.4     1.3     4,125.1
Exercise of stock options.................                   2.3      --        36.3
Rescission of stock option exercises......                  (0.2)               (1.1)
Exercise of warrants......................                   1.3      --         9.0
Common stock issued for cash..............                  42.2     0.4     2,327.2
Preferred stock issued for cash...........    2.0                            1,862.0
Common stock issued for an acquisition....                  84.9     0.9     5,487.4
Conversion of series preferred stock......   (0.5)   --      9.2     0.1         7.5
Preferred stock issued for dividends......                                       9.4
Accreted dividends on preferred stock.....    0.1    --                        (97.8)
Accretion of discount on preferred
  stock...................................                                      (0.3)
Comprehensive loss:
Net loss for the year ended December 31,
  2000....................................                                               $ (2,963.7)
Currency translation adjustment...........                                                   (432.6)
Unrealized net losses on investments......                                                    (14.2)
                                                                                         ----------
    Total.................................                                               $ (3,410.5)
                                             ----    --    -----    ----   ---------     ----------
Balance, December 31, 2000................    2.9    --    272.1     2.7    13,764.7
Exercise of stock options.................                   1.1                13.0
Non-cash compensation.....................                                      30.6
Accreted dividends on preferred stock.....    0.1                             (195.5)
Accretion of discount on preferred
  stock...................................                                     (25.3)
Conversion of 7% Convertible Notes........                   3.3     0.1       128.2
Common stock issued for an acquisition....                   0.1                 4.3
Comprehensive loss:
Net loss for the year ended December 31,
  2001....................................                                               $(14,241.3)
Currency translation adjustment...........                                                   (607.8)
Unrealized net losses on investments......                                                     (1.1)
Unrealized net losses on derivatives......                                                    (15.0)
                                                                                         ----------
    Total.................................                                                (14,865.2)
                                             ----    --    -----    ----   ---------     ----------
Balance, December 31, 2001................    3.0    $--   276.6    $2.8   $13,720.0
                                             ====    ==    =====    ====   =========     ==========

<Caption>
                                                       ACCUMULATED OTHER
                                                      COMPREHENSIVE LOSS
                                            ---------------------------------------
                                                          UNREALIZED    UNREALIZED
                                              FOREIGN         NET           NET
                                             CURRENCY      LOSSES ON     LOSSES ON
                                            TRANSLATION   INVESTMENTS   DERIVATIVES   (DEFICIT)
                                            -----------   -----------   -----------   ----------
                                                               (IN MILLIONS)
<S>                                         <C>           <C>           <C>           <C>
Balance, December 31, 1998................   $   104.7                                $ (1,251.7)
Exercise of stock options.................
Exercise of warrants......................
Common stock issued for cash..............
Preferred stock issued for cash...........
Warrants issued for cash..................
Accreted dividends on preferred stock.....
Accretion of discount on preferred
  stock...................................
Redemption of series preferred stock......
Conversion of 7% Convertible Notes........
Common stock issued for an acquisition....
Stock options issued in connection with an
  acquisition.............................
Issuance of warrants......................
Stock splits..............................
Comprehensive loss:
Net loss for the year ended December 31,
  1999....................................                                                (735.7)
Currency translation adjustment...........      (106.8)
    Total.................................
                                             ---------      ------        ------      ----------
Balance, December 31, 1999................        (2.1)                                 (1,987.4)
Exercise of stock options.................
Rescission of stock option exercises......
Exercise of warrants......................
Common stock issued for cash..............
Preferred stock issued for cash...........
Common stock issued for an acquisition....
Conversion of series preferred stock......
Preferred stock issued for dividends......
Accreted dividends on preferred stock.....
Accretion of discount on preferred
  stock...................................
Comprehensive loss:
Net loss for the year ended December 31,
  2000....................................                                              (2,963.7)
Currency translation adjustment...........      (432.6)
Unrealized net losses on investments......                  $(14.2)
    Total.................................
                                             ---------      ------        ------      ----------
Balance, December 31, 2000................      (434.7)      (14.2)                     (4,951.1)
Exercise of stock options.................
Non-cash compensation.....................
Accreted dividends on preferred stock.....
Accretion of discount on preferred
  stock...................................
Conversion of 7% Convertible Notes........
Common stock issued for an acquisition....
Comprehensive loss:
Net loss for the year ended December 31,
  2001....................................                                             (14,241.3)
Currency translation adjustment...........      (607.8)
Unrealized net losses on investments......                    (1.1)
Unrealized net losses on derivatives......                                $(15.0)
    Total.................................
                                             ---------      ------        ------      ----------
Balance, December 31, 2001................   $(1,042.5)     $(15.3)       $(15.0)     $(19,192.4)
                                             =========      ======        ======      ==========
</Table>

                            See accompanying notes.
                                       F-5
<PAGE>

                       NTL INCORPORATED AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                                  YEAR ENDED DECEMBER 31,
                                                            -----------------------------------
                                                               2001         2000        1999
                                                            ----------   ----------   ---------
                                                                       (IN MILLIONS)
<S>                                                         <C>          <C>          <C>
OPERATING ACTIVITIES
Net loss..................................................  $(14,241.3)  $ (2,963.7)  $  (735.7)
Adjustment to reconcile net loss to net cash (used in)
  provided by operating activities:
  Depreciation and amortization...........................     3,170.5      2,122.8       791.3
  Non-cash compensation...................................        30.6           --          --
  Non-cash restructuring charge...........................        57.9           --          --
  Asset impairments.......................................     9,072.7           --          --
  Equity in net losses of unconsolidated subsidiaries.....       683.2         70.9        18.4
  Loss from early extinguishment of debt..................          --           --         3.0
  (Gain) loss on sale of assets...........................       147.4           --      (493.1)
  Provision for losses on receivables.....................        97.9         98.9        46.2
  Deferred income taxes...................................        61.1       (112.1)      (37.3)
  Amortization of original issue discount.................       284.9        473.4       451.4
  Other...................................................        46.9        (69.5)      (29.0)
  Changes in operating assets and liabilities, net of
     effect from business acquisitions and dispositions:
     Accounts receivable..................................       (45.9)      (366.6)     (139.4)
     Other current assets.................................        56.4        (69.5)      (38.9)
     Other assets.........................................        59.6         43.2        (4.9)
     Accounts payable.....................................       (34.5)       (83.7)       43.8
     Accrued expenses and other...........................       (73.2)       379.3       126.2
     Deferred revenue.....................................        28.0        186.4        71.9
                                                            ----------   ----------   ---------
Net cash (used in) provided by operating activities.......      (597.8)      (290.2)       73.9
INVESTING ACTIVITIES
Acquisitions, net of cash acquired........................       (26.2)   (10,940.0)   (1,128.3)
Payment of deferred purchase price........................          --         (2.9)         --
Purchase of fixed assets..................................    (1,946.1)    (2,257.0)   (1,211.3)
Investment in and loans to affiliates.....................      (137.8)      (393.4)      (20.8)
Increase in other assets..................................       (80.6)      (129.1)      (58.8)
Proceeds from sales of assets.............................        45.5           --       692.5
Due from CoreComm Limited.................................       (15.0)          --          --
Purchase of marketable securities.........................        (9.9)      (158.4)     (747.4)
Proceeds from sales of marketable securities..............        70.3        452.6       676.6
                                                            ----------   ----------   ---------
Net cash (used in) investing activities...................    (2,099.8)   (13,428.2)   (1,797.5)
</Table>

                                       F-6
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

              CONSOLIDATED STATEMENTS OF CASH FLOWS -- (CONTINUED)

<Table>
<Caption>
                                                                  YEAR ENDED DECEMBER 31,
                                                            -----------------------------------
                                                               2001         2000        1999
                                                            ----------   ----------   ---------
                                                                       (IN MILLIONS)
<S>                                                         <C>          <C>          <C>
FINANCING ACTIVITIES
Proceeds from borrowings, net of financing costs..........     3,110.7      6,870.1     3,019.4
Proceeds from issuance of preferred stock and warrants....          --      1,862.0     1,250.0
Proceeds from issuance of common stock....................          --      2,327.6       250.0
Proceeds from issuance of redeemable preferred stock......          --      1,850.0          --
Redemption of preferred stock.............................          --           --      (125.3)
Principal payments........................................      (489.8)    (1,303.0)     (758.2)
Cash released from (placed in) escrow for debt
  repayment...............................................          --         77.5       (87.0)
Proceeds from exercise of stock options and warrants......        13.0         44.2        42.1
                                                            ----------   ----------   ---------
Net cash provided by financing activities.................     2,633.9     11,728.4     3,591.0
Effect of exchange rate changes on cash...................       (11.1)       (27.8)       (6.5)
                                                            ----------   ----------   ---------
(Decrease) increase in cash and cash equivalents..........       (74.8)    (2,017.8)    1,860.9
Cash and cash equivalents at beginning of year............       579.4      2,597.2       736.3
                                                            ----------   ----------   ---------
Cash and cash equivalents at end of year..................  $    504.6   $    579.4   $ 2,597.2
                                                            ==========   ==========   =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the year for interest exclusive of
  amounts capitalized.....................................  $    947.9   $    495.0   $   180.3
Income taxes paid.........................................        13.5          6.7         2.4
SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES
Accretion of dividends and discount on preferred stock....  $    220.8   $     98.1   $    44.4
Conversion of Convertible Notes, net of unamortized
  deferred financing costs................................       128.3           --       269.3
Common stock and stock options issued for acquisitions....         4.3      5,488.3       978.0
Redeemable preferred stock issued for investment in
  affiliates..............................................       518.0           --          --
Conversion of series preferred stock......................          --          7.6          --
</Table>

                            See accompanying notes.
                                       F-7
<PAGE>

                       NTL INCORPORATED AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  CORPORATE RESTRUCTURING AND BUSINESS

  CORPORATE RESTRUCTURING

     On May 18, 2000, NTL Incorporated completed a corporate restructuring to
create a holding company structure. The formation of the holding company was
part of NTL Incorporated's acquisition of certain assets of Cable & Wireless
Communications plc ("CWC"). The holding company restructuring was accomplished
through a merger so that all the stockholders of NTL Incorporated at the
effective time of the merger became stockholders of the new holding company, and
NTL Incorporated became a subsidiary of the new holding company. The new holding
company has taken the name NTL Incorporated (and together with its subsidiaries,
the "Company") and the holding company's subsidiary simultaneously changed its
name to NTL (Delaware), Inc. (and together with its subsidiaries, "NTL
Delaware").

  BUSINESS

     The Company, through its subsidiaries, owns and operates broadband
communications networks for telephone, cable television and Internet services in
the UK, Ireland, and Switzerland, and transmission networks for television and
radio broadcasting in the UK. The Company's wholly-owned subsidiary that
operates in France was merged into an equity investee in November 2001. The
Company's television and radio broadcasting business in Australia was sold in
April 2002. Based on revenues and identifiable assets, the Company's predominant
lines of business are consumer services, business services and broadcast
transmission and related services in the UK. Consumer services include
telephony, cable television, Internet access and interactive services. Business
services include telephony, national and international wholesale carrier
telecommunications, and radio communications services for the emergency services
community. Broadcast transmission and related services include digital and
analog television and radio broadcasting, rental of antenna space on the
Company's owned and leased towers and sites and associated services, and
satellite and media services.

  RECAPITALIZATION PROCESS AND ABILITY TO CONTINUE OPERATIONS

     The Company historically incurred operating losses and negative operating
cash flow. In addition, the Company required significant amounts of capital to
finance construction of its networks, connection of customers to the networks,
other capital expenditures and for working capital needs including debt service
requirements. The Company historically met these liquidity requirements through
cash flow from operations, amounts available under its credit facilities, vendor
financing and issuances of high-yield debt securities and convertible debt
securities in the capital markets and convertible preferred stock and common
stock to strategic investors. Both the equity and debt capital markets have
recently experienced periods of significant volatility, particularly for
securities issued by telecommunications and technology companies. The ability of
telecommunications companies to access those markets as well as their ability to
obtain financing provided by bank lenders and equipment suppliers has become
more restricted and financing costs have increased. During some recent periods,
the capital markets have been largely unavailable to new issues of securities by
telecommunications companies. The Company's public equity is no longer trading
on the New York Stock Exchange, and its debt securities are trading at or near
all time lows. These factors, together with the Company's substantial leverage,
means the Company does not currently have access to its historic sources of
capital.

     In addition, the Company's UK credit facilities are fully drawn and the
Company's Swiss subsidiaries are currently unable to draw the remaining undrawn
amounts under the Cablecom credit facility. NTL Communications Corp., a
wholly-owned indirect subsidiary of the Company, did not pay cash interest on
certain series of its notes that was due on April 1, 2002 and April 15, 2002.
NTL Incorporated and NTL (Delaware), Inc. also did not pay cash interest and
related fees on a series of their notes that was due on April 15, 2002. As of
December 31, 2001, the Company had approximately $505 million in cash and cash
equivalents on hand and, on April 4, 2002, received approximately $303 million
net cash proceeds from the
                                       F-8
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

sale of its Australian business. The Company will require cash for working
capital and capital expenditures in 2002. If the Company and its subsidiaries
make scheduled and overdue interest payments on their notes, then the Company
will not have sufficient cash resources to meet its liquidity needs through the
third quarter of 2002.

     As of December 31, 2001, $17,666.1 million of the Company's $17,768.4
million of long-term debt had been classified as current due to the
uncertainties about compliance with the terms and conditions of the Company's
debt that would give the holders of the debt the right to accelerate payment.

     These liquidity concerns raise substantial doubt about the Company's
ability to continue as a going concern. As a consequence, the Company needs to
restructure its outstanding debt and/or raise new funds through the issuance of
equity or additional debt.

     On January 31, 2002 the Company announced that it had appointed Credit
Suisse First Boston, JP Morgan and Morgan Stanley to advise on strategic and
recapitalization alternatives to strengthen our balance sheet and reduce debt
and put an appropriate capital structure in place for our business. Since then,
the Company has been evaluating various recapitalization alternatives to effect
a comprehensive consensual reorganization in a timely manner to minimize
negative effects on its business operations.

     On April 16, 2002 the Company announced that the Company and an unofficial
committee of its public bondholders had reached an agreement in principle on a
comprehensive recapitalization of the Company. The Members of the committee hold
in the aggregate over 50% of the face value of NTL and its subsidiaries' public
bonds. The recapitalization would result in a conversion of approximately $10.6
billion in debt into equity.

     During the recapitalization process, NTL's operations will continue
uninterrupted, customer service will be unaffected, suppliers will be paid in
the ordinary course and NTL's management will remain in place.

     To implement the proposed recapitalization, NTL Incorporated, NTL
(Delaware), Inc., NTL Communications Corp., Diamond Cable Communications Limited
and Diamond Holdings Limited would file a pre-negotiated recapitalization plan
in a Chapter 11 case under the U.S. Bankruptcy Code. NTL's operating
subsidiaries would not be included in the Chapter 11 filing. The agreement in
principle is subject to various conditions, including mutually acceptable terms
with the Company's bank lenders. The recapitalization transaction contemplates
that the bank debt will remain in place as part of the recapitalization.

     To facilitate the recapitalization, certain members of the unofficial
committee would commit to provide up to $500 million of new debt financing to
the Company's UK and Ireland operations during the Chapter 11 process and for
the post-recapitalized Company. The new financing will ensure that the Company's
business operations have access to sufficient liquidity to continue ordinary
operations.

     Under the agreement in principle, NTL would be split into two companies,
one tentatively called NTL UK and Ireland and holding all of its UK and Ireland
assets, and one tentatively called NTL Euroco and holding certain of its
continental European and other assets. NTL's current management would remain in
place in both companies.

     Holders of notes of NTL Incorporated, NTL (Delaware), Inc., NTL
Communications Corp. and Diamond Cable Communications Ltd would in the aggregate
receive 100% of the initial common stock of NTL UK and Ireland and approximately
86.5% of the initial common stock of NTL Euroco. NTL (Delaware), Inc.
bondholders would have the option to reinvest all or a portion of NTL
(Delaware), Inc. cash in additional shares of NTL common stock, or to receive
such cash in the recapitalization. Notes of the Company's subsidiaries Diamond
Holdings Ltd and NTL (Triangle) LLC would remain outstanding and will be kept
current in interest payments. Current preferred and common stockholders,
including France Telecom, would participate in a package of rights (to be priced
at a $10.5 billion enterprise value) and warrants entitling them to purchase
primary common stock of NTL UK and Ireland at the consummation of the proposed
plan,
                                       F-9
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

in the case of the rights, and for the duration of the eight-year warrants at
prescribed prices. If fully exercised, those rights and warrants would entitle
the current preferred stockholders to acquire approximately 23.6% and the
current common stockholders to acquire approximately 8.9% of the entity's
primary common stock.

     Current preferred stockholders other than France Telecom, would receive
approximately 3.2% and current common stockholders, other than France Telecom,
would receive approximately 10.3% of the primary equity of NTL Euroco. It is
contemplated that, subject to the consummation of the recapitalization, France
Telecom would also receive our 27% interest in Noos, pursuant to a pledge of
such interests to France Telecom given at the time of its acquisition. During
the recapitalization process, the Company has attempted to maintain normal and
regular trade terms with its suppliers and customers. There can be no assurance
that the Company's suppliers will continue to provide normal trade credit or
credit on acceptable terms, if at all, or that customers will continue to do
business or enter into new business with the Company. See also "Risk Factors"
for a summary of risks related to the Company's business in general and the
recapitalization process in particular.

     The Company's ability to meet its near term funding requirements upon
consummation of the reorganization plan is dependent upon a number of factors,
including the revenue generated by its operating subsidiaries, its existing cash
balances, and its ability to draw upon an exit facility or any alternative
financing. There can be no assurance that these sources of financing will be or
will remain available. The Company will require substantial funds for general
corporate and other expenses and may require additional funds for working
capital fluctuations. Failure to achieve profitability could in the future
diminish the Company's ability to sustain operations, obtain additional required
funds, and make required payments on any indebtedness it has incurred or may
incur. The Company can provide no assurance that it will be successful in
raising additional financing if required, or if successful, that the terms of
such financing will be favorable to the Company.

     The Company currently expects that it will require approximately $730
million to fund its working capital and capital expenditures, net of cash from
operations in the twelve month period ending December 31, 2002 to fund the
expenditures mentioned above.

     The Company believes that cash, cash equivalents and marketable securities
on hand at March 31, 2002, the cash received from the sale of NTL Australia and
the cash expected to be available from the DIP Facility and the exit facility,
if the recapitalization is completed, will be sufficient for its and its
subsidiaries cash requirements for the twelve months ending December 31, 2002.

     Over the long term, the Company will continue to require cash to fund
operations, service its remaining debt and implement its strategy. In order to
fund these requirements, the Company anticipates that it will use cash flow from
operations and may also need to issue additional debt or equity securities or
may need to secure additional bank financing. Given the Company's current
financial condition, there can be no assurance that these sources of funds will
be available to us.

  BANK WAIVERS

     Before the Company could commence negotiations with the unofficial
committee of bondholders, it was necessary to obtain waivers from the lenders
under our credit facilities. Effective March 8, 2002, these lenders granted
waivers which, until March 29, 2002, provided that the commencement of
negotiations with bondholders with a view to rescheduling its debt would not
constitute an event of default under the credit facilities.

     But for the initial waivers, the commencement of negotiations with
bondholders would have been an event of default under the credit facilities. If
an event of default were to occur, it would entitle the lenders under the credit
facilities to declare the principal amount of the outstanding debt immediately
due and payable. If this right was exercised, it would result in an event of
default under all of the Company's outstanding notes, except for those issued by
Diamond Cable Communications, Diamond Holdings and NTL
                                       F-10
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Triangle, entitling the trustee or 25% of the holders of a series to accelerate
the repayment of that series of notes. The Company does not have sufficient cash
resources to repay our outstanding indebtedness if it is declared immediately
due and payable.

     In connection with the granting of the initial waivers, the Company agreed:

     - to provide the lenders with a 13 week rolling cash flow projection
       (updated every two weeks);

     - to keep the lenders informed of, and to provide documents in connection
       with, negotiations with bondholders or strategic investors or concerning
       proposed asset dispositions;

     - not to repurchase NTL notes; and

     - not to make an exchange offer for NTL notes or enter into an agreement
       with NTL bondholders, subject to some exceptions, without the consent of
       the lenders.

     Effective March 28, 2002, the lenders under the credit facilities agreed to
amend the initial waivers. The amendments to the initial waivers extend the
duration of the initial waivers to April 30, 2002 in the case of the UK credit
facilities or May 14 in the case of the Cablecom facility, unless the missed
interest payments on April 1, 2002 are remedied or a sufficient number of
bondholders agree to forbear in respect of such non-payment, in which case, the
UK credit facilities waivers will be extended to May 14, 2002. As a condition to
the waivers continuing effectiveness, the UK lenders required NTL Delaware to
loan 90 million to NTL (UK) Group, Inc. following receipt of the proceeds from
the sale of NTL Australia. This loan is structurally senior to the outstanding
public notes issued by NTL Communications Corp. but contractually subordinated
to the UK credit facilities. In connection with the amendments to the waivers,
the Company affirmed the provisions of the initial waivers and in addition, the
Company agreed, among other things, to:

     - provide the bank lenders a timeline setting forth the steps proposed to
       be taken in connection with the recapitalization and the dates by which
       such steps are to be taken;

     - use reasonable endeavors to consider with the lenders under the Cablecom
       credit facility possible means of credit enhancement;

     - provide the lenders under the Cablecom credit facility, by April 12,
       2002, with an updated structure chart of NTL as well as a contingency
       business plan for Cablecom in the event that sufficient additional
       funding for Cablecom is not obtained; and

     - pay legal, accounting and other advisory fees of the agent or
       coordinators of the Cablecom credit facility.

     The amended waivers prevent the Company from making an exchange offer with
respect to its outstanding notes or from entering into an agreement with
bondholders without the consent of the lenders under each of the credit
facilities. The amended waivers also prohibit the Company from commencing
voluntary dissolution proceedings, including proceedings under Chapter 11 of the
U.S. bankruptcy code, without the consent of these lenders.

     As a consequence, the Company cannot enter into a binding agreement with
the unofficial bondholder committee or implement the proposed plan without the
consent of its bank lenders.

     Cablecom GmbH is the principal trading company of our Swiss group. There
are a number of technical defaults under the Swiss credit facility made
available to Cablecom and various of its subsidiaries. These technical defaults
consisted of the following, as of December 31, 2001:

          1.  The requirement that members of the Cablecom group generating at
     least 95% of the group's EBITDA should guarantee the repayment of the loan
     outstanding under the credit agreement had not been satisfied.

                                       F-11
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

          2.  Three companies within the Cablecom group had merged in
     contravention of restrictions in the credit agreement.

          3.  Loans had been made by members of the Cablecom group to other
     group members and to a 10% affiliate in contravention of restrictions in
     the credit agreement. A related obligation to deliver quarterly
     certificates specifying the maximum levels of intra-group loans had not
     been complied with.

          4.  The requirement to ensure that the total interest cost in respect
     of at least 40% of the loan was capped at interest rates agreed with the
     facility agent had not been complied with.

          5.  A mortgage securing a loan of CHF 600,000 from United Bank of
     Switzerland was refinanced and the benefit of the existing mortgage was
     assigned to the refinancing lender. That assignment meant the mortgage was
     no longer permitted under the credit agreement.

          6.  Four per cent of the shares in FGA Hagendorf SA were acquired by
     Cablecom, making the company a wholly owned member of the Cablecom group.
     That acquisition was not permitted under the credit agreement.

          7.  One of the security documents in favour of the banks required
     specified details of receivables to be provided to the facility agent and
     all such receivables to be paid into bank accounts assigned by way of
     security to the banks. It also required a bank account to be set up for the
     purpose of receiving certain cash payments which may have to be applied in
     prepayment of the facility. That bank account also had to be assigned by
     way of security to the banks. These obligations had not been complied with.

          8.  The following obligations imposed by the share pledges executed by
     various Cablecom group members in favour of the banks had not been
     satisfied:

             (i) the delivery of share certificates and other documents
        evidencing title in respect of certain of the pledged shares;

             (ii) the remedy of defects in certain of the pledged shares; and

             (iii) the transfer of certain nominee shares in Cablecom group
        companies to the Cablecom company which beneficially owns such shares
        and the delivery to the facility agent of copies of shareholders
        registers in the group companies updated to show the transfers.

          9.  One hundred and eighty shares in a company called Telebarn AG had
     been assigned by way of security by Cablecom to the banks notwithstanding
     the terms of a trust agreement under which Cablecom held those shares. That
     constituted a misrepresentation under the finance documents.

     In addition, as of December 31, 2001, Cablecom's and various of its
subsidiaries' liabilities exceeded their respective assets. As a consequence,
under Swiss law, those entities were deemed to be "overindebted".

     In order to try and resolve the problems caused by the overindebtedness of
its subsidiaries Cablecom GmbH had guaranteed the liabilities of some of those
subsidiaries and had agreed that intra-group debt owed to it by some of those
subsidiaries should be subordinated to the debt owed by such subsidiaries to all
of their other creditors. This also constituted an event of default under the
Cablecom credit facility which entitles the lenders to accelerate repayment.
Such an acceleration would result in an event of default under NTL
Incorporated's and NTL Delaware's 5.75% convertible subordinated notes due 2011
5.75% convertible subordinated notes due 2009 entitling the trustee or the
holders of 25% of each series of notes to accelerate repayment. Under Swiss law,
unless the overindebtedness is rectified those entities would be required to
commence an insolvency proceeding in Switzerland. A plan has been formulated to
rectify this overindebtedness. Implementation of this plan prior to April 30,
2002 will mean those entities will not be required to commence an insolvency
proceeding. Those proceedings would likely either be a court supervised
moratorium in which an independent administrator, or commissioner, would be
appointed to supervise the running of each

                                       F-12
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

company during a restructuring or, if there is no viable restructuring plan, a
bankruptcy. The commencement of those insolvency proceedings would also
constitute an immediate event of default and acceleration of the maturity of the
convertible subordinated notes referred to above.

     The Company is currently in discussions with the lenders under the Swiss
credit facility regarding proposals to resolve the overindebtedness issue as
well as requesting that they waive various additional covenant breaches under
the credit facility. There can be no assurance that it will reach agreement on
the resolution of the overindebtedness issue within the time period required or
obtain the requested waivers.

  INTEREST PAYMENTS ON PUBLIC NOTES

     The Company and its subsidiaries have substantial interest payment
obligations under their existing indebtedness. NTL Communications Corp. did not
make scheduled interest payments due April 1, 2002, in the aggregate amount of
$74.2 million, in respect of its 9 1/2% notes due 2008, 11 1/2% notes due 2008
and 11 7/8% notes due 2010. In addition, NTL Communications did not make
interest payments falling due on April 15, 2002, totaling $20.2 million, in
respect of the 12 3/4% Senior Deferred Coupon Notes due 2005 and NTL
Incorporated and NTL Delaware did not make interest payments falling due on
April 15, 2002 in respect of their 5 3/4% Convertible Subordinated Notes due
2011. Those payments were not made after consideration by the Company of
requests by the unofficial bondholder committee not to make those payments.
Interest payments of $18.9 million were made, when due, on April 2, 2002 in
respect of Diamond Cable Communications 13.25% senior discount notes due 2004.
On May 15, 2002, interest totaling $94.0 million is due on outstanding notes of
NTL Triangle and NTL Communications.

     If the applicable issuer does not pay interest on these notes after a 30
day grace period expires (on April 30, 2002 in the case of the missed interest
payments due April 1, 2002), there is an event of default under the indenture in
respect of the notes on which the interest is due and unpaid. An event of
default entitles the trustee under the indenture or the holders of 25% of the
outstanding notes to declare the principal amount of those notes to be
immediately due and payable. Even if the maturity of those notes is not
accelerated after April 30, 2002, such an event of default would also result in
an event of default for payment defaults in respect of other debt (commonly
called cross defaults) under all of our other notes, except for those issued by
NTL Triangle, Diamond Cable Communications or Diamond Holdings. As a result,
upon the expiration of the grace period, on April 30, 2002, events of default
for failure to pay interest would occur under the relevant indentures at NTL
Communications and, contemporaneously, cross defaults would occur under the
Company's other indentures at NTL Communications, NTL Delaware, NTL Incorporated
and under our Senior Credit Facility and Working Capital Facility and could
occur under the Cablecom Facility. This would give holders of the outstanding
series of debt at these entities the right to accelerate repayment of those
debts by declaring the principal amount of the debts to be immediately due and
payable unless we obtain waivers or forbearance agreements from sufficient
percentages of our creditors. If that right to accelerate was exercised, the
Company would not have sufficient cash resources to repay those debts, which
could ultimately lead to voluntary or involuntary bankruptcy proceedings
relating to the entities so affected. In addition, the lenders under the
Company's UK credit facilities have security over the assets of the Company's UK
operating subsidiaries, except for the Diamond and Triangle groups of companies.
In the event that there was an event of default under those facilities, the
lenders could seek to take control of those assets under applicable UK
insolvency law.

  INABILITY TO PAY DIVIDENDS ON OR REDEEM PREFERRED STOCK

     On February 4, 2002, the Company announced that it would not declare or pay
dividends on its 13% Senior Redeemable Exchangeable Preferred Stock. The Company
did not make the dividend payments due on February 15, 2002 of $6.0 million in
respect of the 13% preferred stock. In addition, the Company did not pay
dividends on its 5% cumulative participating convertible preferred stock held by
France Telecom on

                                       F-13
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

December 31, 2001 of $37.0 million and March 31, 2002 of $37.5 million, or on
its cumulative convertible preferred stock held by France Telecom and a group of
commercial banks on December 31, 2001 of $24.9 million and March 26, 2002 of
$24.1 million. Historically, payment of dividends has been made in additional
shares of preferred stock in the case of the 13% preferred stock, the 5%
cumulative participating preferred stock and the cumulative convertible
preferred stock. The Company did not pay these dividends due to a lack of
available surplus under Delaware law. Under Delaware law, the Company cannot pay
dividends on or redeem its capital stock, including its preferred stock, unless
it has available surplus.

     Pursuant to the terms of the 13% preferred stock, the unpaid dividends will
continue to accrue without interest until declared and paid. Pursuant to the
terms of the 5% cumulative convertible preferred stock and the cumulative
convertible preferred stock, the unpaid dividends will continue to accrue
without interest until declared and paid, together with an additional cash
dividend on the amount so unpaid at a rate of 2% per quarter for as long as the
dividends remain unpaid. The failure to declare these dividends is not a default
under any of the Company's existing agreements. With respect to the 13%
preferred stock and 5% cumulative convertible preferred stock, if dividends
remain unpaid for six quarters, the holders of each such series shall have the
right to vote separately as a class on all matters voted on by NTL Incorporated
shareholders and shall have the right, along with other holders of preferred
stock with similar default voting rights, to elect two directors to the
Company's board.

     In addition, the lack of surplus means that the Company does not expect to
be able to redeem its Variable Coupon Redeemable Preferred Stock, Series A,
which is held by France Telecom, when it becomes mandatorily redeemable, to the
extent funds are available, on May 18, 2002. If the Company fails to redeem this
preferred stock on May 18, 2002 as we expect, the holders of such preferred
stock will have the right, along with other holders of preferred stock with
similar default voting rights, to elect two directors to our board and shall
have the right to vote separately as a class, on all matters brought to NTL
Incorporated shareholders.

     At the time of issuance of the Variable Coupon Redeemable Preferred Stock,
the Company pledged its shares of Noos to France Telecom to secure the mandatory
redemption obligation.

  CREDIT RATING DOWNGRADES

     On April 3, 2002, credit rating agency Standard & Poor's lowered the
Company's long-term corporate credit rating to D from CCC-, citing the Company's
failure to make a bond interest payment due on April 1, 2002.

  SALE OF NTL AUSTRALIA

     On April 2, 2002, the Company announced that it had completed the
previously announced sale of its Australian broadcast business to Macquarie Bank
for A$850 million (US$448 million) in an all cash transaction. The net proceeds
from the sale were approximately A$574 million (US$303 million). At that time,
the business' bank debt outstanding totaled A$227 million (US$119 million).

     On April 7, 2002, NTL Delaware loaned L90 million to NTL (UK) Group
Limited, which loan was funded by the proceeds of the sale of NTL Australia.
This loan is subordinated to the Company's UK credit facilities. The remaining
proceeds of the sale of NTL Australia remain at NTL Delaware and it is currently
anticipated that such proceeds will form a portion of the consideration to be
offered to bondholders of NTL Delaware and NTL Incorporated in satisfaction of
their claims against NTL Delaware as part of the proposed plan of
reorganization.

  UNCERTAINTY RELATED TO SUPPLIERS

     The uncertainty over the Company's financial condition may adversely affect
its relationships with its suppliers. If the Company's suppliers become
increasingly concerned about its financial condition they may
                                       F-14
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

demand quicker payment terms or not extend normal trade credit, both of which
could further adversely affect its results of operations, financial condition
and cash flows.

  BASIS OF PRESENTATION

     As indicated above, substantial doubt exists about the Company's ability to
continue as a going concern. The accompanying consolidated financial statements
have been prepared assuming that the Company will continue as going concern. The
financial statements do not include any adjustments to reflect the possible
future effects on the recoverability of assets or classification of assets or
the amounts and classification of liabilities that may result from the outcome
of this uncertainty.

     Due to uncertainties about compliance with the terms and conditions of the
Company's debt that would give the holders of the debt the right to accelerate
repayment, primarily all of the Company's long-term debt has been classified as
current.

2.  SIGNIFICANT ACCOUNTING POLICIES

  USE OF ESTIMATES

     The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Such estimates and assumptions impact, among
others, the following: the amount of uncollectible accounts and notes
receivable, the amount to be paid to terminate certain agreements included in
restructuring costs, the amount to be paid for other liabilities, the Company's
pension expense and pension funding requirements and estimates related to the
value of investments, long-lived assets and goodwill. Actual results could
differ from those estimates.

  PRINCIPLES OF CONSOLIDATION

     The consolidated financial statements include the accounts of the Company,
its wholly-owned subsidiaries and entities where the Company's interest is
greater than 50%. Significant intercompany accounts and transactions have been
eliminated in consolidation.

  RECLASSIFICATION

     Certain prior year amounts have been reclassified to conform to the current
year presentation.

  NET (LOSS) PER SHARE

     The Company reports its basic and diluted net (loss) per share in
accordance with Financial Accounting Standards Board ("FASB") Statement of
Financial Accounting Standards ("SFAS") No. 128, "Earnings Per Share", as
adjusted for stock splits. Stock options, warrants and convertible securities
are excluded from the calculation of net loss per common share as their effect
would be antidilutive.

  FOREIGN CURRENCY TRANSLATION

     The financial statements of the Company's foreign subsidiaries have been
translated into U.S. dollars in accordance with SFAS No. 52, "Foreign Currency
Translation." All balance sheet accounts have been translated using the current
exchange rates at the respective balance sheet dates. Statement of operations
amounts have been translated using the average exchange rates for the respective
years. The translation gains or losses resulting from the change in exchange
rates have been reported as a component of accumulated other comprehensive
(loss). Foreign currency transaction gains and losses are included in the
results of operations as incurred.

                                       F-15
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     To the extent that the Company obtains financing in U.S. dollars and incurs
construction and operating costs in various other currencies, it will encounter
currency exchange rate risks. In addition, the Company's revenues are generated
in foreign currencies while its interest and principal obligations with respect
to approximately half of the Company's existing indebtedness are payable in U.S.
dollars.

  CASH EQUIVALENTS

     Cash equivalents are short-term highly liquid investments purchased with a
maturity of three months or less. Cash equivalents were $343.7 million and
$256.2 million at December 31, 2001 and 2000, respectively, which consisted
primarily of U.S. Treasury bills (2000 only), bank time deposits and corporate
commercial paper. At December 31, 2001 and 2000, $190.2 million and $68.5
million, respectively, of the cash equivalents were denominated in foreign
currencies.

  MARKETABLE SECURITIES

     Marketable securities are classified as available-for-sale, which are
carried at fair value. Unrealized holding gains and losses on securities, net of
tax, are carried as a component of accumulated other comprehensive (loss). The
amortized cost of debt securities is adjusted for amortization of premiums and
accretion of discounts to maturity. Such amortization is included in interest
income. Realized gains and losses and declines in value judged to be other than
temporary will be included in interest income. The cost of securities sold or
matured is based on the specific identification method. Interest on securities
is included in interest income.

     Marketable securities at December 31, 2000 consisted of corporate
commercial paper. During the years ended December 31, 2001, 2000 and 1999, there
were no realized gains or losses on sales of securities. All of the marketable
securities as of December 31, 2000 had a contractual maturity of less than one
year.

  FIXED ASSETS

     Fixed assets are stated at cost, which includes amounts capitalized for
labor and overhead expended in connection with the design and installation of
operating equipment. Depreciation is computed by the straight-line method over
the estimated useful lives of the assets. Estimated useful lives are as follows:
operating equipment -- 5 to 40 years and other equipment -- 3 to 40 years.

  INTANGIBLE ASSETS

     Intangible assets include goodwill, license acquisition costs, customer
lists and other intangibles. Goodwill is the excess of the purchase price over
the fair value of net assets acquired in business combinations accounted for as
purchases. Goodwill is amortized on a straight-line basis over the periods
benefited of 3, 10, 15 or 30 years. License acquisition costs represent the
portion of purchase price allocated to the cable television and
telecommunications licenses acquired in business combinations. License
acquisition costs are amortized on a straight-line basis over the remaining
lives of the licenses at acquisition, which vary from approximately two years to
23 years. Customer lists represent the portion of the purchase price allocated
to the value of the customer base. Customer lists are amortized on a
straight-line basis over 3 or 5 years. Other intangibles include the portion of
the purchase price allocated to the value of transmission and services contracts
and the value of workforce in place. Transmission and service contracts are
amortized on a straight-line basis over the period benefited of 8 years or 12
years. Workforce in place is amortized over the period benefited of four years.
The Company continually reviews the recoverability of the carrying value of
these assets using the same methodology that it uses for the evaluation of its
other long-lived assets.

                                       F-16
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  VALUATION OF LONG-LIVED ASSETS

     Long-lived assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. If the
sum of the expected future undiscounted cash flows is less than the carrying
amount of the asset, a loss is recognized for the difference between the fair
value and the carrying value of the asset.

  EQUITY METHOD INVESTMENTS

     All investments in which the Company has the ability to exercise
significant influence over the investee, but less than a controlling voting
interest, are accounted for using the equity method. Equity method investments
are recorded at original cost and adjusted periodically to recognize the
Company's proportionate share of the investees' net income or losses after the
date of investment, additional contributions made and dividends received. The
difference between the Company's recorded investment and its proportionate
interest in the book value of the investees' net assets are being amortized on a
straight-line basis over 10 years. The Company evaluates the carrying value of
its equity method investments and tests for impairment in accordance with APB
Opinion No. 18.

  DEFERRED FINANCING COSTS

     Deferred financing costs are incurred in connection with the issuance of
debt and are amortized over the term of the related debt.

  CAPITALIZED INTEREST

     Interest is capitalized as a component of the cost of fixed assets
constructed. In 2001, 2000 and 1999, total interest incurred was $1,508.6
million, $1,131.9 million and $722.5 million, respectively, of which interest of
$67.7 million, $95.1 million and $41.8 million, respectively, was capitalized.

  REVENUE RECOGNITION

     Revenues are recognized at the time the service is rendered to the customer
or the performance of the service has been completed. Charges for services that
are billed in advance are deferred and recognized when earned. Rental revenues
are recognized when earned on a monthly basis. Installation and maintenance
service revenues are recognized when the performance of the service has been
completed.

  CABLE TELEVISION SYSTEM COSTS, EXPENSES AND REVENUES

     The Company accounts for costs, expenses and revenues applicable to the
construction and operation of its broadband communications networks in
accordance with SFAS No. 51, "Financial Reporting by Cable Television
Companies."

  ADVERTISING EXPENSE

     The Company charges the cost of advertising to expense as incurred.
Advertising costs were $91.0 million, $113.0 million and $35.9 million in 2001,
2000 and 1999, respectively.

  STOCK-BASED COMPENSATION

     The Company has adopted the disclosure-only provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation." The Company applies APB Opinion No.
25, "Accounting for Stock Issued to Employees" and related interpretations in
accounting for its stock option plans.

                                       F-17
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  DERIVATIVE FINANCIAL INSTRUMENTS

     The Company uses financial instruments to hedge a portion, but not all, of
its exposure from floating interest rate debt and from movements in foreign
exchange rates. Gains and losses on these instruments are deferred and
recognized in the statement of operations when the related hedged transactions
are recognized. To date, premiums paid for these contracts have not been
material. The Company does not use derivative financial instruments for trading
or speculative purposes.

     The Company sometimes uses British pound forward foreign exchange contracts
to reduce its exposure to foreign currency risk. A forward foreign exchange
contract obligates the Company to exchange predetermined amounts of specified
foreign currencies at specified exchange rates on specified dates or to make an
equivalent U.S. dollar payment equal to the value of such exchange. These
contracts do not qualify for hedge accounting under SFAS No. 133 (as amended).
Any changes in fair value are recorded in results of operations.

3.  RECENT ACCOUNTING PRONOUNCEMENTS

     In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," effective for the Company on
January 1, 2002. This Statement supercedes SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of" and
other related accounting guidance. The adoption of this new standard had no
significant effect on the results of operations, financial condition or cash
flows of the Company, except that it will require the Company to treat NTL
Australia as a discontinued operation beginning in the first quarter of 2002.

     In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations," effective for the Company on January 1, 2003. This
Statement addresses financial accounting and reporting for obligations
associated with the retirement of tangible fixed assets and the associated asset
retirement costs. The Company is in the process of evaluating the financial
statement impact of the adoption of SFAS No. 143.

     In June 2001, the FASB issued SFAS No. 141, "Business Combinations," and
No. 142, "Goodwill and Other Intangible Assets." SFAS No. 141 requires that the
purchase method of accounting be used for all business combinations initiated
after June 30, 2001. Use of the pooling-of-interests method is no longer
permitted. SFAS No. 141 also includes guidance on the initial recognition and
measurement of goodwill and other intangible assets acquired in a business
combination that is completed after June 30, 2001. SFAS No. 142 ends the
amortization of goodwill and indefinite-lived intangible assets. Instead, these
assets must be reviewed annually (or more frequently under certain conditions)
for impairment in accordance with this statement. This impairment test uses a
fair value approach rather than the undiscounted cash flow approach previously
required by SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of." The Company adopted SFAS No. 142
on January 1, 2002. In light of the significant impairment charge that the
Company recorded in 2001, the Company does not expect that the adoption of this
new standard will have a significant effect on the results of operations,
financial condition or cash flows of the Company. Amortization expense in 2001
related to goodwill and other indefinite lived intangible assets was $1,430.2
million. Estimated aggregate amortization expense for each of the five
succeeding fiscal years from December 31, 2001 is as follows: $128.8 million in
2002, $127.6 million in 2003, $79.7 million in 2004, $42.3 million in 2005 and
$34.5 million in 2006.

4.  ASSET IMPAIRMENTS

     As of December 31, 2001, the Company performed an analysis of the carrying
values of its long-lived assets including goodwill. During 1999 and 2000,
acquisitions were made against a background of increasing consolidation and
record valuations in the telecommunications industry. This analysis was
initiated because of the decline in the Company's stock price and significantly
lower valuations for companies within its industry. Additionally, at the time of
the Company's analysis, the book value of the Company's net assets significantly
exceeded its market capitalization. Accordingly, the Company performed an
analysis of the recoverability of

                                       F-18
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

its long-lived assets and associated goodwill. The fair value of the Company's
assets was determined by discounting the Company's estimates of the expected
future cash flows related to these assets when the non-discounted cash flows
indicated that the long-lived assets would not be recoverable. The Company
recorded a write-down of $9,511.3 million in the fourth quarter of 2001 as a
result of this analysis and review, of which $9,072.7 million is included in
asset impairments and $438.6 million is included in share of losses from equity
investments. The asset impairment charge of $9,072.7 million included goodwill
of $8,840.5 million, license acquisition costs of $58.8 million, customer lists
of $9.1 million, other intangibles of $14.9 million, investments in affiliates
of $25.1 million and other assets of $124.3 million. The aggregate asset
impairment charge of $9,511.3 million related to the Company's business segments
as follows: $7,388.8 million Consumer, $2,113.0 million Business and $9.5
million Broadcast.

5.  ACQUISITIONS

     On March 28, 2000, the Company acquired the cable assets of the Cablecom
Group ("Cablecom") in Switzerland. On May 30, 2000, the Company acquired the
consumer cable telephone, Internet and television operations of CWC in the UK
("ConsumerCo"). The acquisitions were accounted for as purchases, and
accordingly, the net assets and results of operations of the acquired businesses
have been included in the consolidated financial statements from the dates of
acquisition.

     In March 1999, the Company purchased Diamond Communications Plc ("Diamond")
for an aggregate purchase price of $984.6 million, including intangibles
aggregating $1,323.0 million. In April 1999, a subsidiary of the Company
purchased the Australian National Transmission Network for an aggregate purchase
price of $425.8 million, including intangibles of $220.6 million. In July 1999,
the Company acquired Cablelink Limited ("Cablelink") for an aggregate purchase
price of $700.5 million, including intangibles of $669.6 million. In August and
December 1999, the Company acquired the 1G Networks of France Telecom for an
aggregate purchase price of $61.9 million, including intangibles of $64.7
million. In September 1999, the Company acquired the shares of Workplace
Technologies plc, for an aggregate purchase price of $175.0 million, including
intangibles of $176.9 million. The net assets and results of operations of
Diamond, the Australian National Transmission Network, Cablelink, the 1G
Networks and Workplace Technologies plc are included in the consolidated
financial statements from their respective dates of acquisition.

     A significant component of the pro forma results is associated with the
acquisition of ConsumerCo. The historical results of ConsumerCo reflect certain
intercompany costs and expenses as they were prior to the separation of
ConsumerCo, which was completed in the second quarter of 2000. These costs and
expenses do not necessarily reflect the costs and expenses that would have been
incurred had ConsumerCo reported as a separate entity for these periods.
Therefore the historical results of ConsumerCo which are included in the pro
forma results below are not reflective of results on a going forward basis.

     The pro forma unaudited consolidated results of operations for the years
ended December 31, 2000 and 1999 assuming consummation of these transactions as
of January 1, 1999 is as follows (in millions, except per share data).

                                       F-19
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

<Table>
<Caption>
                                                              YEAR ENDED DECEMBER 31,
                                                              -----------------------
                                                                 2000         1999
                                                              ----------   ----------
<S>                                                           <C>          <C>
Total revenue...............................................  $ 3,403.3    $ 3,295.8
(Loss) before extraordinary item............................   (3,653.1)    (2,803.1)
Net (loss)..................................................   (3,653.1)    (2,806.1)
Basic and diluted net loss per common share:
(Loss) before extraordinary item............................     (14.53)      (12.46)
Net (loss)..................................................     (14.53)      (12.47)
</Table>

     In November 2001, the Company sold a portion of the indirect access
customers acquired from CWC in May 2000. The sales price was L10.2 million
($14.8 million) which does not include contingent payments for the collection of
certain future service revenues and existing receivables. The Company recognized
a loss on this sale of $88.5 million, after deducting $102.0 million of
unamortized intangibles. The value assigned to these assets upon acquisition was
$135.9 million.

6.  FIXED ASSETS

     Fixed assets consist of:

<Table>
<Caption>
                                                                  DECEMBER 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
                                                                  (IN MILLIONS)
<S>                                                           <C>         <C>
Operating equipment.........................................  $13,626.2   $11,753.2
Other equipment.............................................      911.4     1,145.2
Construction-in-progress....................................    1,326.2     1,611.1
                                                              ---------   ---------
                                                               15,863.8    14,509.5
Accumulated depreciation....................................   (3,290.5)   (1,816.5)
                                                              ---------   ---------
                                                              $12,573.3   $12,693.0
                                                              =========   =========
</Table>

7.  INTANGIBLE ASSETS

     Intangible assets consist of:

<Table>
<Caption>
                                                                  DECEMBER 31,
                                                              --------------------
                                                                2001       2000
                                                              --------   ---------
                                                                 (IN MILLIONS)
<S>                                                           <C>        <C>
Goodwill, net of accumulated amortization of $81.7 (2001)
  and $1,103.6 (2000).......................................  $1,715.5   $12,523.0
License acquisition costs, net of accumulated Amortization
  of $125.2 (2001) and $215.8 (2000)........................      54.7       139.2
Customer lists, net of accumulated amortization of $169.3
  (2001) and $110.7 (2000)..................................     168.8       318.2
Other intangibles, net of accumulated amortization of $17.3
  (2001) and $13.8 (2000)...................................      46.6        80.6
                                                              --------   ---------
                                                              $1,985.6   $13,061.0
                                                              ========   =========
</Table>

                                       F-20
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

8.  INVESTMENTS IN AND LOANS TO AFFILIATES

     On May 18, 2001, in partnership with Morgan Stanley Dean Witter Private
Equity, the Company completed its acquisition of France Telecom's 49.9% stake in
Suez-Lyonnaise Telecom, the operator of the Noos broadband network in France.
Pursuant to the acquisition agreement, the Company acquired 27% of Noos in
exchange for shares of preferred stock. The preferred stock was valued at $518.0
million, the fair value at the date of acquisition. An additional E17.7 million
($15.8 million) purchase consideration is due to France Telecom on transfer to
Noos of specified networks following receipt of regulatory approvals, which
would be payable in May 2002. The Company's 27% interest in Noos is pledged to
France Telecom to secure the mandatory redemption obligation under its Variable
Coupon Redeemable Preferred Stock, Series A.

     On November 23, 2001, the Company's indirect wholly-owned subsidiary that
owned the Company's cable business in France was merged into Noos. The Company
received E72.6 million ($63.7 million) including a note for E37.5 million ($32.9
million) which is due on November 23, 2006. The Company recorded a loss on this
transaction of $58.9 million, which is included in other losses.

     The Company has investments in various companies and joint ventures which
are accounted for under either the equity method or the cost method. The
Company's significant equity investments include its 27% interest in Noos S.A.,
the market leading French broadband company, which offers analog and digital
cable television, high speed Internet and telephone services, its 34.01%
interest in Svenska Bredbandsbolaget ("B2"), a company based in Sweden, which
provides "always on," low cost access to a high-capacity broadband network that
provides transmission, both to and from the customer, at the same speed and at
the same time, and its 50% interest in eKabel InvestCo, which owns 65% of eKabel
L.P., the largest cable television network in the German province of Hessen. The
Company recorded a write-down of $463.7 million related to its investments in
and loans to affiliates in the fourth quarter of 2001. The Company's investments
in and loans to affiliates are as follows:

<Table>
<Caption>
                                                                DECEMBER 31,
                                                 -------------------------------------------
                                                         2001                   2000
                                                 --------------------   --------------------
                                                 OWNERSHIP   BALANCE    OWNERSHIP    BALANCE
                                                 ---------   --------   ----------   -------
                                                             (DOLLARS IN MILLIONS)
<S>                                              <C>         <C>        <C>          <C>
Noos...........................................    27.00%     $ 47.0                 $   --
B2.............................................    34.01%       92.5      25.15%      134.7
eKabel.........................................    32.50%       73.0      32.50%      140.2
Others.........................................                 52.8                   34.3
                                                              ------                 ------
Total equity investments.......................                265.3                  309.2
Total cost investments.........................                  7.1                   23.9
                                                              ------                 ------
Total..........................................               $272.4                 $333.1
                                                              ======                 ======
</Table>

                                       F-21
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     A summary of combined financial information as reported by the Company's
equity investees is set forth below:

<Table>
<Caption>
                                                                 DECEMBER 31,
                                                              -------------------
                                                                2001       2000
                                                              --------   --------
                                                                 (IN MILLIONS)
<S>                                                           <C>        <C>
Current assets..............................................  $  495.5   $  267.1
Fixed assets, net...........................................     910.9      353.8
Other assets................................................   2,690.0      842.1
                                                              --------   --------
Total assets................................................  $4,096.4   $1,463.0
                                                              ========   ========
Current liabilities.........................................  $  366.3   $  229.6
Non current liabilities.....................................   1,445.4      705.0
Total shareholders' equity..................................   2,284.7      528.4
                                                              --------   --------
Total liabilities and shareholders' equity..................  $4,096.4   $1,463.0
                                                              ========   ========
</Table>

<Table>
<Caption>
                                                            YEAR ENDED DECEMBER 31,
                                                           --------------------------
                                                            2001      2000      1999
                                                           -------   -------   ------
                                                                 (IN MILLIONS)
<S>                                                        <C>       <C>       <C>
Revenues.................................................  $ 437.4   $ 195.3   $ 57.5
Operating (loss).........................................   (445.3)   (257.6)   (43.5)
Net (loss)...............................................   (606.8)   (348.1)   (50.7)
</Table>

     NTL (Triangle) LLC ("NTL Triangle"), an indirect wholly-owned subsidiary of
the Company, owned a 50% interest in Cable London PLC ("Cable London"). Pursuant
to an agreement with Telewest Communications plc ("Telewest") relating to NTL
Triangle's and Telewest's respective 50% ownership interests in Cable London, in
November 1999 Telewest purchased all of NTL Triangle's shares of Cable London
for L428.0 million ($692.5 million) in cash. The Company recorded a gain of
$493.1 million on the sale. The sale of the Cable London interest was an "Asset
Sale" for purposes of the Company's Indentures for certain of its notes. The
Company used an amount equal to the proceeds from the sale to invest in
"Replacement Assets" by November 2000.

9.  LONG-TERM DEBT

     Long-term debt consists of:

<Table>
<Caption>
                                                                     DECEMBER 31,
                                                                 ---------------------
                                                                   2001        2000
                                                                 ---------   ---------
                                                                     (IN MILLIONS)
<S>                                                       <C>    <C>         <C>
NTL Incorporated:
  5 3/4% Convertible Subordinated Notes.................  (a)    $   100.0   $      --
NTL Delaware:
  5 3/4% Convertible Subordinated Notes.................  (b)      1,200.0     1,200.0
ConsumerCo:
  Term Loan Facility and other..........................                --        21.7
NTL Business:
  Credit Agreement......................................  (y)           --     3,030.3
Cablecom:
  Term Loan Facility....................................  (z)      1,626.8     1,666.4
  Revolving Facility....................................  (z)        527.2       320.9
  Other.................................................               6.2        15.3
</Table>

                                       F-22
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

<Table>
<Caption>
                                                                     DECEMBER 31,
                                                                 ---------------------
                                                                   2001        2000
                                                                 ---------   ---------
                                                                     (IN MILLIONS)
<S>                                                       <C>    <C>         <C>
NTL Australia:
  Credit Agreement......................................  (aa)       102.3          --
NTL Communications:
  12 3/4% Senior Deferred Coupon Notes..................  (c)        277.8       277.8
  11 1/2% Senior Deferred Coupon Notes..................  (d)      1,050.0     1,040.5
  10% Senior Notes......................................  (e)        400.0       400.0
  9 1/2% Senior Sterling Notes, less unamortized
     discount...........................................  (f)        181.4       186.5
  10 3/4% Senior Deferred Coupon Sterling Notes.........  (g)        382.3       353.6
  9 3/4% Senior Deferred Coupon Notes...................  (h)      1,153.8     1,048.5
  9 3/4% Senior Deferred Coupon Sterling Notes..........  (i)        385.9       360.8
  11 1/2% Senior Notes..................................  (j)        625.0       625.0
  12 3/8% Senior Deferred Coupon Notes..................  (k)        364.9       323.6
  7% Convertible Subordinated Notes.....................  (l)        489.8       599.3
  9 1/4% Senior Euro Notes..............................  (m)        222.5       234.7
  9 7/8% Senior Euro Notes..............................  (n)        311.5       328.6
  11 1/2% Senior Deferred Coupon Euro Notes.............  (o)        135.6       127.9
  11 7/8% Senior Notes, less unamortized discount.......  (p)        490.7       489.6
  12 3/8% Senior Euro Notes, plus unamortized premium...  (q)        267.8          --
  6 3/4% Convertible Senior Notes.......................  (r)      1,150.0          --
NTL Communications Limited:
  Credit Agreement......................................  (y)      3,759.1       375.3
  Working Capital Agreement.............................  (y)        145.4          --
  Senior Secured Financing..............................  (y)        290.9          --
  Other.................................................              58.6          --
NTL Triangle:
  11.2% Senior Discount Debentures......................  (s)        517.3       517.3
  Other.................................................               4.5         5.2
Diamond:
  13 1/4% Senior Discount Notes.........................  (t)        285.1       285.1
  11 3/4% Senior Discount Notes.........................  (u)        531.0       531.0
  10 3/4% Senior Discount Notes.........................  (v)        415.1       373.9
  10% Senior Sterling Notes.............................  (w)        196.3       201.9
  9 1/8% Senior Notes...................................  (x)        110.0       110.0
  Other.................................................               3.6         6.0
                                                                 ---------   ---------
                                                                  17,768.4    15,056.7
Less current portion....................................          17,666.1        12.6
                                                                 ---------   ---------
                                                                 $   102.3   $15,044.1
                                                                 =========   =========
</Table>

---------------

 (a) 5 3/4% Convertible Subordinated Notes due June 22, 2011, issued in June
     2001, principal amount at maturity of $100.0 million, interest payable
     quarterly from October 15, 2001, redeemable at the Company's option on or
     after December 22, 2007, convertible into shares of the Company's common
     stock at a conversion price of $35.00 per share (there are approximately
     2.9 million shares of the Company's common stock reserved for issuance upon
     conversion);

 (b) 5 3/4% Convertible Notes due December 15, 2009, principal amount at
     maturity of $1,200.0 million, interest payable semiannually from June 15,
     2000, redeemable at the Company's option on or after December 18, 2002,
     convertible into shares of the Company's common stock at a conversion price
     of $108.18 per share (there are approximately 11.1 million shares of the
     Company's common stock reserved for issuance upon conversion);

                                       F-23
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

 (c) 12 3/4% Notes due April 15, 2005, principal amount at maturity of $277.8
     million, interest payable semiannually from October 15, 2000, redeemable at
     the Company's option on or after April 15, 2000;

 (d) 11 1/2% Notes due February 1, 2006, principal amount at maturity of
     $1,050.0 million, interest payable semiannually from August 1, 2001,
     redeemable at the Company's option on or after February 1, 2001;

 (e) 10% Notes due February 15, 2007, principal amount at maturity of $400.0
     million, interest payable semiannually from August 15, 1997, redeemable at
     the Company's option on or after February 15, 2002;

 (f) 9 1/2% Sterling Notes due April 1, 2008, principal amount at maturity of
     L125.0 million ($181.8 million), interest payable semiannually from October
     1, 1998, redeemable at the Company's option on or after April 1, 2003;

 (g) 10 3/4% Sterling Notes due April 1, 2008, principal amount at maturity of
     L300.0 million ($436.3 million), interest payable semiannually beginning on
     October 1, 2003, redeemable at the Company's option on or after April 1,
     2003;

 (h) 9 3/4% Notes due April 1, 2008, principal amount at maturity of $1,300.0
     million, interest payable semiannually beginning on October 1, 2003,
     redeemable at the Company's option on or after April 1, 2003;

 (i) 9 3/4% Sterling Notes due April 15, 2009, principal amount at maturity of
     L330.0 million ($479.9 million), interest payable semiannually beginning on
     October 15, 2004, redeemable at the Company's option on or after April 15,
     2004;

 (j) 11 1/2% Notes due October 1, 2008, principal amount at maturity of $625.0
     million, interest payable semiannually from April 1, 1999, redeemable at
     the Company's option on or after October 1, 2003;

 (k) 12 3/8% Notes due October 1, 2008, principal amount at maturity of $450.0
     million, interest payable semiannually beginning on April 1, 2004,
     redeemable at the Company's option on or after October 1, 2003;

 (l) 7% Convertible Notes due December 15, 2008, principal amount at maturity of
     $489.8 million, interest payable semiannually from June 15, 1999,
     redeemable at the Company's option on or after December 15, 2001,
     convertible into shares of the Company's common stock at a conversion price
     of $39.20 per share (there are approximately 12.5 million shares of the
     Company's common stock reserved for issuance upon conversion);

 (m) 9 1/4% Euro Notes due November 15, 2006, principal amount at maturity of
     E250.0 million ($222.5 million), interest payable semiannually from May 15,
     2000;

 (n) 9 7/8% Euro Notes due November 15, 2009, principal amount at maturity of
     E350.0 million ($311.5 million), interest payable semiannually from May 15,
     2000, redeemable at the Company's option on or after November 15, 2004;

 (o) 11 1/2% Deferred Euro Notes due November 15, 2009, principal amount at
     maturity of E210.0 million ($186.9 million), interest payable semiannually
     beginning on May 15, 2005, redeemable at the Company's option on or after
     November 15, 2004;

 (p) 11 7/8% Notes due October 1, 2010, principal amount at maturity of $500.0
     million, interest payable semiannually from April 1, 2001, redeemable at
     the Company's option on or after October 1, 2005;

 (q) 12 3/8% Senior Euro Notes due February 1, 2008, issued in January and
     February 2001, principal amount at maturity of E300.0 million ($267.0
     million), interest payable semiannually from August 1, 2001;

 (r) 6 3/4% Convertible Senior Notes due May 15, 2008, issued in May 2001,
     principal amount at maturity of $1,150.0 million, interest payable
     semiannually from November 15, 2001, redeemable at the Company's option on
     or after May 21, 2004, convertible into shares of the Company's common
     stock at a conversion price of $32.728 per share (there are approximately
     35.1 million shares of the Company's common stock reserved for issuance
     upon conversion);

                                       F-24
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

 (s) 11.2% Debentures due November 15, 2007, principal amount at maturity of
     $517.3 million, interest payable semiannually from May 15, 2001, redeemable
     at NTL Triangle's option after November 15, 2000;

 (t) 13 1/4% Notes due September 30, 2004, principal amount at maturity of
     $285.1 million, interest payable semiannually from March 31, 2000,
     redeemable at Diamond's option after September 30, 1999;

 (u) 11 3/4% Notes due December 15, 2005, principal amount at maturity of $531.0
     million, interest payable semiannually from June 15, 2001, redeemable at
     Diamond's option on or after December 15, 2000;

 (v) 10 3/4% Notes due February 15, 2007, principal amount at maturity of $420.5
     million, interest payable semiannually beginning on August 15, 2002,
     redeemable at Diamond's option on or after December 15, 2002;

 (w) 10% Sterling Notes due February 1, 2008, issued by Diamond Holdings plc,
     principal amount at maturity of L135.0 million ($196.3 million), interest
     payable semiannually from August 1, 1998, redeemable at Diamond's option on
     or after February 1, 2003; and

 (x) 9 1/8% Notes due February 1, 2008, issued by Diamond Holdings plc,
     principal amount of $110.0 million, interest payable semiannually from
     August 1, 1998, redeemable at Diamond's option on or after February 1,
     2003.

     See Note 1 for discussion of the uncertainties about compliance with the
terms and conditions of the Company's debt that would give the holders of the
debt the right to accelerate repayment, which has caused primarily all of the
Company's long-term debt to be classified as current.

     The indentures governing the notes contain restrictions relating to, among
other things: (i) incurrence of additional indebtedness and issuance of
preferred stock, (ii) dividend and other payment restrictions and (iii) mergers,
consolidations and sales of assets. The Company, NTL Delaware and NTL
Communications did not make interest payments and payments of related fees when
due on April 1 and April 15, 2002.

     If the applicable issuer does not pay interest on these notes after a 30
day grace period expires (on April 30, 2002 in the case of the missed interest
payments due April 1, 2002), there is an event of default under the indenture in
respect of the notes on which the interest is due and unpaid. An event of
default entitles the trustee under the indenture or the holders of 25% of the
outstanding notes to declare the principal amount of those notes to be
immediately due and payable. Even if the maturity of those notes is not
accelerated after April 30, 2002, such an event of default would also result in
an event of default for payment defaults in respect of other debt (commonly
called cross defaults) under all of our other notes, except for those issued by
NTL Triangle, Diamond Cable Communications or Diamond Holdings. As a result,
upon the expiration of the grace period, on April 30, 2002, events of default
for failure to pay interest would occur under the relevant indentures at NTL
Communications and, contemporaneously, cross defaults would occur under the
Company's other indentures at NTL Communications, NTL Delaware, NTL Incorporated
and under our bank credit facilities in the United Kingdom and could occur under
the Cablecom Facility. This would give holders of the outstanding series of debt
at these entities the right to accelerate repayment of those debts by declaring
the principal amount of the debts to be immediately due and payable unless we
obtain waivers or forbearance agreements from sufficient percentages of our
creditors.

     During 2001, 2000 and 1999, the Company recognized $284.9 million, $473.4
million and $451.4 million, respectively, of original issue discount as interest
expense.

     In addition to the notes described above, subsidiaries of the Company have
the following bank credit agreements outstanding:

 (y) In May 2000, NTL Business Limited ("NTL Business") and NTL Communications
     Limited ("NTLCL"), wholly-owned indirect subsidiaries of the Company,
     entered into a L2,500.0 million ($3,635.8 million) credit agreement in
     connection with the ConsumerCo acquisition. On February 21,

                                       F-25
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     2001, as required by the NTL Business and NTLCL credit agreement, NTL
     Communications Corp. ("NTL Communications"), a wholly-owned indirect
     subsidiary of the Company, completed a transaction whereby it acquired the
     entire issued share capital of NTL (CWC Holdings) Limited (the entity that
     owns ConsumerCo) from the Company and the entire issued share capital of
     NTL Business from NTL Delaware in exchange for shares of its common stock.
     As a result of this transaction, ConsumerCo and NTL Business became
     subsidiaries of NTL Communications, and NTL Business' rights and
     obligations under the L2,500.0 million credit agreement were assigned to a
     subsidiary of NTLCL. In October 2001, NTLCL completed L169.6 million
     ($246.6 million) of vendor financing as an addition to NTLCL's L2,500.0
     million credit agreement with the same terms and conditions. The Company
     borrowed L84.8 million ($123.3 million) of the vendor financing in October
     2001. The commitment for the remaining L84.8 million has expired. Interest
     is payable at least every six months at LIBOR plus a margin rate of 2.00%
     per annum, which is subject to adjustment based on the ratio of EBITDA to
     finance charges of the UK Group.

     For purposes of this credit agreement, Diamond Cable Communications Limited
     and subsidiaries, NTL (Triangle) LLC and subsidiaries and certain other
     entities are excluded from the UK Group. The unused portion of the
     commitment is subject to a commitment fee of 0.75% payable quarterly, which
     is reduced to 0.50% when over 50% of the commitment is utilized. Principal
     is due in six quarterly installments beginning on June 30, 2004. The credit
     agreement contains various financial and other covenants with respect to
     the UK Group, and restrictions on dividends and distributions by the UK
     Group. As of December 31, 2001, there was L2,584.8 million ($3,759.1
     million) outstanding under this credit agreement. The effective interest
     rate was 6.73% and 8.283% as of December 31, 2001 and 2000, respectively.

     In October 2001, NTLCL completed L200.0 million ($290.9 million) of GE
     Capital senior secured financing. Interest on the GE Capital senior secured
     financing is payable at least every six months at LIBOR plus a margin rate
     of 3.50% per annum. The senior secured financing is repayable in eight
     quarterly installments beginning on June 30, 2006. The effective interest
     rate at December 31, 2001 was 8.06%.

     NTLCL has a L1,300.0 million ($1,890.6 million) credit agreement with a
     group of banks, which is available to finance working capital requirements
     of the UK Group (as defined above). Pursuant to the credit agreement, in
     connection with the issuance of new debt beginning in October 2000, the
     commitment has been reduced by L882.5 million ($1,283.4 million). Interest
     is payable at least every six months at LIBOR plus a margin rate of 5.50%
     per annum. The margin rate shall increase by 0.50% on the three month
     anniversary of the initial advance and by an additional 0.50% on each
     subsequent three month anniversary, up to a maximum total interest rate of
     16.00% per annum. The unused portion of the commitment is subject to a
     commitment fee of 0.75% payable quarterly. Principal is due in full on
     March 31, 2006. The credit agreement contains various financial and other
     covenants with respect to the UK Group, and restrictions on dividends and
     distributions by the UK Group. As of December 31, 2001, L100.0 million
     ($145.4 million) was outstanding under this credit agreement with an
     effective interest rate of 9.57%. In January and February 2002, the Company
     borrowed the remaining amounts available under this agreement.

 (z) In March 2000, a subsidiary of the Company borrowed CHF 2,700.0 million
     ($1,626.8 million) under its term loan facility in connection with the
     acquisition of Cablecom. Interest is payable at least every six months at
     Swiss LIBOR plus a margin rate of 2.50% per annum, which is subject to
     adjustment after March 2001 based on Cablecom's ratio of senior debt to
     EBITDA. The effective rate of interest at December 31, 2001 and 2000 was
     5.27% and 6.03%, respectively. Principal is due over six years in quarterly
     installments beginning on March 31, 2004. Cablecom had the option to draw
     on a revolving loan facility up to an additional CHF 1,400.0 million
     ($843.5 million). The revolving facility is intended

                                       F-26
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     to finance operating expenses, working capital and other capital
     expenditures of Cablecom and subsidiaries and for their general corporate
     financing requirements. As of December 31, 2001, Cablecom had borrowed CHF
     875.0 million ($527.2 million) under the revolving loan facility. The
     effective rate of interest as of December 31, 2001 and 2000 was 5.49% and
     6.02%, respectively. The revolving facility is available until May 2003,
     although Cablecom is currently unable to draw the remaining undrawn amounts
     under this facility because, as of December 31, 2001, its liabilities
     exceeded its assets, which constituted an event of default under the
     facility. The interest rate, interest payment requirements and principal
     payments for the revolving facility are the same as for the term loan
     facility. The revolving facility includes a commitment fee of 0.75% payable
     quarterly on the unused portion of the revolving facility commitment, which
     is reduced to 0.50% when over 50% of the commitment is utilized. The term
     loan facility and the revolving facility contain various financial and
     other covenants with respect to Cablecom and subsidiaries, and restrictions
     on dividends and distributions by Cablecom subsidiaries.

(aa) In March 2001, NTL Australia Pty Limited ("NTL Australia"), a wholly-owned
     indirect subsidiary of the Company, entered into a A$350.0 million ($179.1
     million) credit agreement with a group of banks. As of December 31, 2001,
     NTL Australia had borrowed A$200.0 million ($102.3 million) under this
     credit agreement. NTL Australia may use the proceeds under this credit
     agreement to repay NTL Delaware for part of its original investment as well
     as funding general capital expenditures, working capital and corporate
     purposes. As of December 31, 2001, NTL Australia repaid A$200.0 million
     ($102.3 million) to NTL Delaware. Interest is payable at least every six
     months at the A$ Bank Bill Bid Rate plus a margin of 1.85% per annum, which
     is subject to adjustment based on the ratio of senior debt to EBITDA of NTL
     Australia. The effective interest rate at December 31, 2001 was 6.98%. The
     unused portion of the commitment is subject to a commitment fee of 0.60%,
     which is subject to adjustment based on the ratio of senior debt to EBITDA
     of NTL Australia. Principal is due in four semiannual installments
     beginning on June 30, 2004 of a maximum of A$7.5 million, A$7.5 million,
     A$12.5 million and A$12.5 million. The balance is due in full on March 30,
     2006. The credit agreement contains various financial and other covenants
     with respect to NTL Australia and restrictions on dividends and
     distributions by NTL Australia.

     In February 2001, $109.5 million principal amount of 7% Convertible
Subordinated Notes due December 15, 2008 were converted into 2.8 million shares
of the Company's common stock at the applicable conversion price of $39.20 per
share. The Company issued as a premium on the conversion an additional 0.5
million shares which were valued at the Company's closing common stock price on
the dates of conversion. The premium, which amounted to $17.6 million, is
included in interest expense. Additionally accrued and unpaid interest of $1.2
million at the time of the conversion was waived by the holders of the
convertible notes.

     In connection with the Cablelink acquisition, the Company issued $704.6
million principal amount Senior Increasing Rate Notes due 2000. In November
1999, the Company received net proceeds of $720.7 million from the issuance of
the 9 1/4% Euro Notes, the 9 7/8% Euro Notes and the 11 1/2% Deferred Euro
Notes, of which $716.5 million was used to repay the Senior Increasing Rate
Notes plus accrued interest. The Company recorded an extraordinary loss from the
early extinguishment of the notes of $3.0 million in 1999.

     Primarily all of the notes issued by NTL Communications, as well as the
bank credit facilities, restrict the payment of cash dividends and loans to the
Company.

                                       F-27
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Long-term debt repayments are due as follows (in millions). The table
reflects the Company's contractual obligations, but the entire obligation,
except for NTL Australia's long term portion has been classified as current.

<Table>
<Caption>
YEAR ENDING DECEMBER 31:
------------------------
<S>                                                           <C>
2002........................................................  $      5.7
2003........................................................         2.8
2004........................................................       512.2
2005........................................................     4,602.9
2006........................................................     1,854.1
Thereafter..................................................    11,235.6
                                                              ----------
Total debt repayments.......................................    18,213.3
Less: current portion.......................................   (18,111.0)
                                                              ----------
                                                              $    102.3
                                                              ==========
</Table>

10.  REDEEMABLE PREFERRED STOCK

     On September 12, 2001, the Company issued 1,850,000 shares of its
Cumulative Convertible Preferred Stock, Series A ("Convertible Preferred Stock")
in exchange for the 1,850,000 issued and outstanding shares of its 5% Cumulative
Preferred Stock held by France Telecom and others. The Convertible Preferred
Stock has a stated value and liquidation preference of $1,075.17 per share and
is mandatorily redeemable for cash by the Company on March 27, 2009. Dividends
are payable quarterly in additional shares of Convertible Preferred Stock, at
the following quarterly dividend rates: (i) from September 12, 2001 through
March 26, 2002, $13.44 per share, (ii) from March 27, 2002 through March 26,
2003, $21.23 per share and (iii) from March 27, 2003 through March 26, 2004,
$26.61 per share. Once the Convertibility Date (as defined below) is set, the
quarterly dividend rate resets to $16.12 per share and the Convertible Preferred
Stock becomes eligible for conversion into shares of the Company's common stock
beginning on a "Convertibility Date," at which time the conversion price is set
at 125% of the immediately preceding 25 trading day volume-weighted average
price of the Company's common stock (the "Convertibility Base Price"). The
Convertibility Date is as follows: March 27, 2002, unless the Company elects to
delay convertibility until March 27, 2003 or, alternatively, redeems, at its
option, all shares of the Convertible Preferred Stock on March 27, 2002 in cash;
if the Company has delayed, March 27, 2003, unless the Company elects again to
delay convertibility until March 27, 2004, which it may only do if the
Convertibility Base Price would be less than or equal to $65.00 per share (as
may be adjusted for certain antidilutive events); the Company may also elect,
instead, to redeem all shares of the Convertible Preferred Stock on March 27,
2003 in cash; if the Company has delayed, March 27, 2004, unless the Company
elects to redeem all shares of the Convertible Preferred Stock on March 27, 2004
in cash. In no event will the Convertibility Date be after March 27, 2004. In
March 2002, the Company elected to delay the Convertibility Date until at least
March 27, 2003. Holders of Convertible Preferred Stock other than any commercial
bank or their affiliates may at any time elect, subject to some conditions, to
exchange their Convertible Preferred Stock for up to a 50% interest in an entity
holding the Company's Swiss operations.

     On May 18, 2001, the Company issued 47,000 shares of its Variable Coupon
Redeemable Preferred Stock, Series A ("Variable Coupon Redeemable Preferred
Stock") and 12,000 shares of its 6.5% Fixed Coupon Redeemable Preferred Stock,
Series A ("6.5% Redeemable Preferred Stock") to France Telecom in exchange for a
27% interest in Noos. The Variable Coupon Redeemable Preferred Stock has a
stated value and liquidation preference of $10,000 per share and is mandatorily
redeemable for cash by the Company on May 18, 2002. Dividends are payable
quarterly at the Company's option in cash or additional shares of

                                       F-28
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Variable Coupon Redeemable Preferred Stock, at a quarterly rate based on a
quotient of (x) the sum of (1) the EURIBOR Rate in effect on the first day of
every dividend period plus (2) 2.5% over (y) four, per share. The Company's 27%
interest in Noos is pledged to France Telecom to secure the mandatory redemption
obligation under its Variable Coupon Redeemable Preferred Stock and the 6.5%
Redeemable Preferred Stock. The 6.5% Redeemable Preferred Stock has a stated
value and liquidation preference of $10,000 per share and is mandatorily
redeemable for cash by the Company on May 18, 2007. Dividends at a rate of 6.5%
per annum are cumulative and are payable in cash upon redemption.

     In March 2000, the Company received $1,850.0 million in cash from France
Telecom and a group of commercial banks in exchange for 1,850,000 shares of its
redeemable 5% Cumulative Preferred Stock. As described above, in May 2001, the
Company issued 1,850,000 shares of its Convertible Preferred Stock in exchange
for the 1,850,000 issued and outstanding shares of its 5% Cumulative Preferred
Stock.

     In February 1997, the Company issued 100,000 shares of its 13% Senior
Redeemable Exchangeable Preferred Stock (the "Redeemable Preferred Stock"). The
Company received net proceeds of $96.6 million after discounts and commissions
from the issuance of the Redeemable Preferred Stock. Discounts, commissions and
other fees incurred of $3.7 million were recorded as unamortized discount at
issuance. Dividends accrue at 13% per annum ($130 per share) and are payable
quarterly in arrears. Dividends accruing on or prior to February 15, 2004 may,
at the option of the Company, be paid in cash, by the issuance of additional
Redeemable Preferred Stock or in any combination of the foregoing. As of
December 31, 2001, the Company has accrued $86.8 million for dividends and has
issued approximately 84,000 shares for $83.8 million of such accrued dividends.
The Redeemable Preferred Stock may be redeemed, at the Company's option, in
whole or in part, at any time on or after February 15, 2002 at a redemption
price of 106.5% of the liquidation preference of $1,000 per share that declines
annually to 100% in 2005, in each case together with accrued and unpaid
dividends to the redemption date. The Redeemable Preferred Stock is subject to
mandatory redemption on February 15, 2009. On any scheduled dividend payment
date, the Company may, at its option, exchange all of the shares of Redeemable
Preferred Stock then outstanding for the Company's 13% Subordinated Exchange
Debentures due 2009 (the "Subordinated Debentures").

     The Subordinated Debentures, if issued, will bear interest at a rate of 13%
per annum, payable semiannually in arrears on February 15 and August 15 of each
year commencing with the first such date to occur after the date of exchange.
Interest accruing on or prior to February 15, 2004 may, at the option of the
Company, be paid in cash, by the issuance of additional Subordinated Debentures
or in any combination of the foregoing. The Subordinated Debentures will be
redeemable, at the Company's option, in whole or in part, on or after February
15, 2002 at a redemption price of 106.5% that declines annually to 100% in 2005,
in each case together with accrued and unpaid interest to the redemption date.

                                       F-29
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The changes in the number of shares of Redeemable Preferred Stock were as
follows:

<Table>
<Caption>
                                  13%          5%        VARIABLE    6.5%     CONVERTIBLE
                                --------   -----------   --------   -------   -----------
<S>                             <C>        <C>           <C>        <C>       <C>
Shares at December 31, 1998...   125,000            --        --         --           --
Issued for dividends..........    17,000            --        --         --           --
                                --------   -----------   -------    -------   ----------
Shares at December 31, 1999...   142,000            --        --         --           --
Issued for cash...............        --     1,850,000        --         --           --
Issued for dividends..........    20,000            --        --         --           --
                                --------   -----------   -------    -------   ----------
Shares at December 31, 2000...   162,000     1,850,000        --         --           --
Issued for investment in
  Noos........................        --            --    47,000     12,000           --
Issued for dividends..........    22,000            --     1,000         --           --
Exchange......................        --    (1,850,000)       --         --    1,850,000
                                --------   -----------   -------    -------   ----------
Shares at December 31, 2001...   184,000            --    48,000     12,000    1,850,000
                                ========   ===========   =======    =======   ==========
Liquidation preference at
  December 31, 2001 (in
  millions)...................  $  186.8   $        --   $ 491.7    $ 126.9   $  2,029.1
                                ========   ===========   =======    =======   ==========
</Table>

11.  DERIVATIVE FINANCIAL INSTRUMENTS

     Effective January 1, 2001, the Company adopted SFAS No. 133, "Accounting
for Derivative Instruments and Hedging Activities," as amended by SFAS Nos. 137
and 138. The new accounting standard requires that all derivative instruments be
recorded on the balance sheet at fair value. Changes in the fair value of
derivatives are recorded each period in the results of operations or in other
comprehensive income (loss), depending on whether a derivative is designated as
a fair value or cash flow hedge. The ineffective portion of all hedges is
recognized in the results of operations. Beginning October 1, 2001, the Company
has recorded the change in the fair value of derivatives related to changes in
time value each period in other comprehensive income for certain qualifying cash
flow hedges.

     On January 1, 2001, the Company recorded all of its outstanding derivative
instruments at their fair value. The outstanding derivative instruments were
comprised of cross currency swaps to hedge exposure to movements in the British
pound/U.S. dollar exchange rate, and a number of zero cost collars to hedge
exposure to floating interest rates on certain of its debt. The aggregate fair
value on January 1, 2001 was a liability of $9.0 million, of which $6.8 million
was recorded as an expense and $2.2 million was recorded as other comprehensive
loss. In 2001, the Company entered into cross currency swaps to hedge exposure
to movements in the Euro/British pound exchange rate. In the year ended December
31, 2001, the Company recorded income of $3.4 million and other comprehensive
loss of $12.8 million as a result of changes in the fair values. The aggregate
fair value at December 31, 2001 was a net liability of $18.4 million.

     In September 2001, the Company entered into a British pound forward foreign
exchange agreement, consisting of twenty-six accumulating forward contracts, to
reduce its exposure to movement in the British pound/U.S. dollar exchange rate
in accordance with its market risk strategies. As of December 31, 2001, the fair
value of this instrument was a liability of $0.3 million.

12.  NON-CASH COMPENSATION

     In July 2001, the Compensation and Option Committee of the Board of
Directors (the "Compensation Committee") approved modifications to certain stock
options. The latest possible expiration date of options to purchase an aggregate
of approximately 4.7 million shares of the Company's common stock with exercise

                                       F-30
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

prices from $.17 to $14.76 per share was extended from July 30, 2001 to October
2004, as applicable, to January 30, 2006. The Company recognized non-cash
compensation expense of $30.6 million based on the excess of the quoted market
price of the Company's common stock on the date of the modification of $12.05
per share over the exercise price per share.

     In September 2000, the Board of Directors approved modifications to certain
stock options granted to employees in November 1999 through May 2000. Options to
purchase an aggregate of approximately 16.5 million shares of the Company's
common stock with a weighted average exercise price of $64.39 per share were
modified such that the exercise price was reduced to $44.50 per share and the
vesting schedule was delayed and/or lengthened. The Company is accounting for
these options as a variable plan beginning in September 2000. The Company will
recognize non-cash compensation expense for the difference between the quoted
market price of the Company's common stock and the exercise price of the vested
options while the options remain outstanding.

     The Compensation Committee has taken the actions described above to
continue to provide the appropriate performance incentives to those affected.

13.  OTHER CHARGES INCLUDING RESTRUCTURING CHARGES

     Other charges of $311.6 million in 2001 include restructuring charges of
$209.6 million and costs of $102.1 million incurred primarily to integrate the
acquired companies, mostly related to information technology integration, as
well as costs incurred for business rationalization consulting. Other charges of
$92.7 million in 2000 include restructuring charges of $65.9 million and costs
of $26.8 million incurred primarily to integrate the acquired companies, mostly
related to information technology integration, as well as costs incurred for
business rationalization consulting. Other charges of $16.2 million in 1999 were
incurred for the cancellation of certain contracts.

     Restructuring charges of $209.6 million and $65.9 million for the years
ended December 31, 2001 and 2000, respectively, relate to the Company's
announcements in the fourth quarter of 2001 and in November 2000 that it was
taking additional actions to reorganize, re-size and reduce operating costs and
create greater efficiency in various areas of the Company. An aggregate of $57.9
million of the 2001 restructuring charges are for the write-off of equipment and
other assets that are not in use and will not require any future cash outlays.
The employee severance and related costs in 2000 were for approximately 2,300
employees to be terminated, approximately 550 of whom are still employed by the
Company as of December 31, 2001. These charges in 2001 are for approximately
5,400 employees to be terminated, of which approximately 3,000 employees are
still employed by the Company as of December 31, 2001.

                                       F-31
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following table summarizes the restructuring charges incurred and
utilized in 2000 and 2001:

<Table>
<Caption>
                                       EMPLOYEE
                                       SEVERANCE    LEASE
                                      AND RELATED   EXIT      AGREEMENT     FIXED
                                         COSTS      COSTS   MODIFICATIONS   ASSETS   TOTAL
                                      -----------   -----   -------------   ------   ------
                                                          (IN MILLIONS)
<S>                                   <C>           <C>     <C>             <C>      <C>
Charged to expense..................    $ 47.9      $18.0       $  --       $   --   $ 65.9
Utilized............................        --         --          --           --       --
                                        ------      -----       -----       ------   ------
Balance, December 31, 2000..........      47.9       18.0          --           --     65.9
2000 provision utilized.............     (41.3)      (9.6)         --           --    (50.9)
2000 provision released.............      (6.6)      (7.3)         --           --    (13.9)
Charged to expense..................      96.5       41.4        27.7         57.9    223.5
2001 provision utilized.............     (26.2)        --          --        (57.9)   (84.1)
                                        ------      -----       -----       ------   ------
Balance, December 31, 2001..........    $ 70.3      $42.5       $27.7       $   --   $140.5
                                        ======      =====       =====       ======   ======
</Table>

14.  INCOME TAXES

     The provision (benefit) for income taxes consists of the following:

<Table>
<Caption>
                                                             YEAR ENDED DECEMBER 31,
                                                             ------------------------
                                                             2001     2000      1999
                                                             -----   -------   ------
                                                                  (IN MILLIONS)
<S>                                                          <C>     <C>       <C>
Current:
  Federal..................................................  $  --   $    --   $  1.0
  State and local..........................................    1.2       0.2      1.0
  Foreign..................................................    0.9       0.9       --
                                                             -----   -------   ------
Total current..............................................    2.1       1.1      2.0
                                                             -----   -------   ------
Deferred:
  Foreign..................................................  $61.1   $(112.1)  $(37.3)
                                                             -----   -------   ------
Total deferred.............................................   61.1    (112.1)   (37.3)
                                                             -----   -------   ------
                                                             $63.2   $(111.0)  $(35.3)
                                                             =====   =======   ======
</Table>

     The Company's tax provision relates primarily to an increase in the
deferred tax liability attributable to separate company profits of a foreign
subsidiary offset to some extent by a decrease in net deferred tax liabilities
attributable to operating losses of other foreign subsidiaries. The increase in
deferred tax liabilities includes an adjustment related to 1997 through 2000 of
approximately $116.3 million that is primarily attributable to additional tax
depreciation being claimed during 2001 on original and amended income tax
returns.

                                       F-32
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Significant components of
the deferred tax liabilities and assets are as follows:

<Table>
<Caption>
                                                                  DECEMBER 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
                                                                  (IN MILLIONS)
<S>                                                           <C>         <C>
Deferred tax liabilities:
  Intangibles...............................................  $    68.9   $   113.3
  Depreciation and amortization.............................      467.5       667.0
                                                              ---------   ---------
Total deferred tax liabilities..............................      536.4       780.3
Deferred tax assets:
  Net operating losses......................................    2,154.6     1,582.4
  Net deferred interest expense.............................      239.9       198.5
  Fixed assets..............................................      370.2       277.9
  Equity investments........................................       52.5          --
  Inventory.................................................       13.7        16.4
  Purchase accounting liabilities...........................       16.5       158.5
  Other.....................................................       59.8        34.0
                                                              ---------   ---------
Total deferred tax assets...................................    2,907.2     2,267.7
                                                              ---------   ---------
Valuation allowance for deferred tax assets.................   (2,631.7)   (1,692.8)
                                                              ---------   ---------
Net deferred tax assets.....................................      275.5       574.9
                                                              ---------   ---------
Net deferred tax liabilities................................  $   260.9   $   205.4
                                                              =========   =========
</Table>

     At December 31, 2001, the Company had a valuation allowance against its
deferred tax assets to the extent it was not more likely than not that such
assets would be realized in the future. At December 31, 2001, the valuation
allowance includes approximately $535.0 million, which, if realized, would be
accounted for as a reduction to goodwill or an increase in additional paid-in
capital.

     At December 31, 2001, the Company had net operating loss carryforwards of
approximately $1,300.0 million for U.S. federal income tax purposes that expire
in varying amounts commencing in 2009. This excludes net operating loss
carryforwards of companies that are resident in both the U.S. and the UK. The
Company also has UK net operating loss carryforwards of approximately $5,250.0
million that have no expiration date. Pursuant to UK law, these net operating
losses are only available to offset income of the separate entity that generated
the loss. A portion of the UK net operating loss carryforward relates to dual
resident companies, of which the U.S. net operating loss carryforward amount is
approximately $1,100.0 million.

     As discussed in Note 1, the Company needs to restructure its outstanding
debt during 2002. A restructuring of the Company's debt can be expected to give
to rise to cancellation of indebtedness ("COD"), which if it occurs in the
course of a proceeding pursuant to Chapter 11 of the U.S. Bankruptcy Code, would
be non-taxable. If the COD is non-taxable, the Company will be required to
reduce its U.S. net operating loss carryforwards and other attributes such as
tax basis in assets by an amount equal to the non-recognized COD. Therefore, it
is likely that as a result of the successful completion of the proposed plan of
recapitalization, the Company will have no U.S. net operating loss carryforward.

     In 2000, the Internal Revenue Service completed its federal income tax
audit of the Company for the years 1993, 1994 and 1995. The audit resulted in a
reduction in U.S. net operating loss carryforwards that had no material impact
on the Company. The Company is currently undergoing a U.S. federal income tax
audit

                                       F-33
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

for the years 1996, 1997 and 1998. The Company does not expect that the audit
adjustments will have a material adverse effect on its financial position,
results of operations or cash flows.

     The reconciliation of income taxes computed at U.S. federal statutory rates
to income tax expense is as follows:

<Table>
<Caption>
                                                           YEAR ENDED DECEMBER 31,
                                                       -------------------------------
                                                         2001        2000       1999
                                                       ---------   ---------   -------
                                                                (IN MILLIONS)
<S>                                                    <C>         <C>         <C>
(Benefit) at federal statutory rate (35%)............  $(4,962.3)  $(1,076.1)  $(269.9)
Add:
  Non-deductible asset impairments...................    3,329.0          --        --
  Foreign losses with no benefit.....................    1,135.8       815.7     110.2
  U.S. losses with no benefit........................      443.6       149.3     123.7
  Prior year accelerated depreciation................      116.3          --        --
  State and local income tax, net of federal
     benefit.........................................        0.8         0.1       0.7
                                                       ---------   ---------   -------
                                                       $    63.2   $  (111.0)  $ (35.3)
                                                       =========   =========   =======
</Table>

15.  FAIR VALUES OF FINANCIAL INSTRUMENTS

     The following methods and assumptions were used by the Company in
estimating its fair value disclosures for financial instruments:

          Cash and cash equivalents:  The carrying amounts reported in the
     consolidated balance sheets approximate fair value.

          Long-term debt:  The carrying amounts of the bank credit facilities
     and the senior secured financing approximate their fair values. The fair
     values of the Company's other debt in the following table are based on the
     quoted market prices.

          Redeemable Preferred Stock:  The fair value of the 13% redeemable
     preferred stock is based on the quoted market price. As of December 31,
     2001, the remaining redeemable preferred stock is estimated by reference to
     the fair value of the 13% redeemable preferred stock. As of December 31,
     2000, the fair value of the 5% preferred stock is estimated using
     discounted cash flow analyses based on the Company's current borrowing rate
     for similar types of arrangements.

     The carrying amounts and fair values of the Company's financial instruments
are as follows:

<Table>
<Caption>
                                                DECEMBER 31, 2001       DECEMBER 31, 2000
                                              ---------------------   ---------------------
                                              CARRYING                CARRYING
                                               AMOUNT    FAIR VALUE    AMOUNT    FAIR VALUE
                                              --------   ----------   --------   ----------
                                                              (IN MILLIONS)
<S>                                           <C>        <C>          <C>        <C>
Cash and cash equivalents...................  $  504.6    $  504.6    $  579.4    $  579.4
Long-term debt:
  5 3/4% Convertible Notes..................   1,200.0       132.0     1,200.0       582.0
  5 3/4% Convertible Notes..................     100.0        29.0          --          --
  Credit Agreements.........................   3,861.4     3,861.4     3,405.6     3,405.6
  Term Loan and Revolving Facilities........   2,154.0     2,154.0     1,987.3     1,987.3
  12 3/4% Notes.............................     277.8        91.7       277.8       255.6
  11 1/2% Notes.............................   1,050.0       336.0     1,040.5       913.5
  10% Notes.................................     400.0       120.0       400.0       348.0
</Table>

                                       F-34
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

<Table>
<Caption>
                                                DECEMBER 31, 2001       DECEMBER 31, 2000
                                              ---------------------   ---------------------
                                              CARRYING                CARRYING
                                               AMOUNT    FAIR VALUE    AMOUNT    FAIR VALUE
                                              --------   ----------   --------   ----------
                                                              (IN MILLIONS)
<S>                                           <C>        <C>          <C>        <C>
  9 1/2% Sterling Senior Notes..............     181.4        60.1       186.5       154.2
  10 3/4% Sterling Notes....................     382.3       124.3       353.6       242.3
  9 3/4% Notes..............................   1,153.8       338.0     1,048.5       715.0
  9 3/4% Sterling Notes.....................     385.9       124.8       360.8       214.7
  11 1/2% Notes.............................     625.0       200.0       625.0       556.3
  12 3/8% Notes.............................     364.9       108.0       323.6       252.0
  7% Convertible Notes......................     489.8        53.9       599.3       470.5
  9 1/4% Euro Notes.........................     222.5        74.6       234.7       207.7
  9 7/8% Euro Notes.........................     311.5       104.4       328.6       269.4
  11 1/2% Euro Deferred Notes...............     135.6        44.9       127.9        99.6
  11 7/8% Senior Notes......................     490.7       160.0       489.6       445.0
  12 3/8% Euro Notes........................     267.8        90.8          --          --
  6 3/4% Convertible Notes..................   1,150.0       353.6          --          --
  Working Capital Agreement.................     145.4       145.4          --          --
  Senior Secured Financing..................     290.9       290.9          --          --
  11.2% Debentures..........................     517.3       367.3       517.3       439.7
  13 1/4% Notes.............................     285.1        77.0       285.1       270.8
  11 3/4% Notes.............................     531.0       132.8       531.0       467.3
  10 3/4% Notes.............................     415.1       100.9       373.9       281.7
  10% Sterling Notes........................     196.3       143.4       201.9       161.5
  9 1/8% Notes..............................     110.0        71.5       110.0        89.7
Redeemable Preferred Stock:
  13% Redeemable Preferred Stock............     184.6         3.7       161.9       121.3
  5% Preferred Stock........................        --          --     1,921.3     1,781.8
  Variable Coupon Preferred Stock...........     477.9         7.2          --          --
  6.5% Preferred Stock......................      89.5         1.3          --          --
  5% Convertible Preferred Stock............   2,029.1        30.5          --          --
</Table>

16.  RELATED PARTY TRANSACTIONS

     In 1999, the Company provided management, financial, legal and technical
services to Cellular Communications International, Inc. ("CCII") and Cellular
Communications of Puerto Rico, Inc. ("CCPR"). Certain officers and directors of
the Company were officers and directors of CCII and CCPR.

     In the fourth quarter of 1999, CoreComm Limited ("CoreComm") (which was
formed in 1998 and has certain common officers and directors with the Company)
began charging the Company a percentage of its office rent and supplies expense
in respect of certain facilities which were shared with the Company. In 1999,
the Company charged CCPR, CCII and CoreComm $0.7 million, $0.4 million and $2.3
million, respectively, for direct costs where identifiable and a fixed
percentage of its corporate overhead, net of CoreComm's charges to the Company.
Charges to CCPR and to CCII ceased in 1999 due to each of them being acquired
and the resulting termination of services. In 2001 and 2000, the Company charged
CoreComm $0.3 million and $0.9 million, respectively, for direct costs where
identifiable and a fixed percentage of its corporate

                                       F-35
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

overhead, net of CoreComm's charges to the Company. These charges reduced
corporate expenses in 2001, 2000 and 1999. It is not practicable to determine
the amounts of these expenses that would have been incurred had the Company
operated as an unaffiliated entity. In the opinion of management of the Company,
the allocation methods are reasonable.

     The Company obtains billing and software development services from
CoreComm. CoreComm billed the Company $3.4 million, $5.9 million and $4.6
million in 2001, 2000 and 1999, respectively, for these services.

     In March 2000, the Company and CoreComm announced that they had entered
into an agreement to link their networks in order to create an international
Internet backbone that commenced operations in February 2001. The Company
incurred costs of $0.3 million for network usage in the year ended December 31,
2001.

     On April 12, 2001, the Company purchased $15.0 million of an unsecured
convertible note from CoreComm and received warrants to purchase 770,000 shares
of CoreComm common stock at an exercise price of $.01 per share that expire in
April 2011. In addition, concurrently with the note purchase and without
additional compensation, the Company entered into a network and software
agreement with CoreComm. Under the agreement, CoreComm will provide U.S. network
access for Internet traffic from the Company's UK customers for three years, as
well as a royalty free license to use certain billing and provisioning software
and know-how. Interest on the notes is at 10.75% per annum, payable semiannually
beginning on October 15, 2001. The interest is payable in kind by the issuance
of additional notes in such principal amount equal to the interest payment that
is then due. The notes are convertible into CoreComm common stock prior to
maturity at a conversion price of $1.00 per share, subject to adjustment.
Additional notes issued for interest will have an initial conversion price equal
to 120% of the weighted average closing price of CoreComm common stock for a
specified period. The Company and CoreComm have agreed to certain modifications
to the conversion feature in connection with CoreComm's recapitalization in
December 2001.

     In 2001, the Company and CoreComm entered into a license agreement whereby
the Company was granted an exclusive, irrevocable, perpetual license to certain
billing software developed by CoreComm for telephony rating, digital television
events rating, fraud management and other tasks. The sales price was cash of
$9.8 million for the development costs expended by CoreComm plus a fixed amount
of $3.0 million representing the one-time perpetual license fee. The billing
software was being used by the Company at the time of this agreement, and was
being maintained and modified by CoreComm under an ongoing software maintenance
and development outsourcing arrangement between the companies.

     At December 31, 2001 and 2000, the Company had a receivable from CoreComm
of $1.1 million and a payable to CoreComm of $17.1 million, respectively. The
2000 payable balance primarily related to services and other charges billed in
advance in October and November 2000 of $15.8 million.

17.  SHAREHOLDERS' EQUITY

  STOCK SPLITS

     In September 1999, the Company declared a 5-for-4 stock split by way of a
stock dividend with respect to its common stock. The record date for this
dividend was October 4, 1999 and the payment date was October 7, 1999. In
January 2000, the Company declared a 5-for-4 stock split by way of a stock
dividend with respect to its common stock. The record date for this dividend was
January 31, 2000 and the payment date was February 3, 2000. Common stock amounts
in the notes to consolidated financial statements and all per share data have
been adjusted to reflect the stock splits.

                                       F-36
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  SALES OF PREFERRED STOCK, COMMON STOCK AND WARRANTS

     In May 2000, in connection with the ConsumerCo acquisition, France Telecom
paid L1,555.6 million ($2,327.6 million) for 42.2 million shares of the
Company's common stock and L1,244.4 million ($1,862.0 million) for 2.0 million
shares of the Company's 5% Cumulative Participating Convertible Preferred Stock
(the "5% Preferred Stock").

     In August 1999, the Company received $1,000.0 million in cash from France
Telecom in exchange for 750,000 shares of the Company's 5% Preferred Stock and
4.2 million shares of the Company's common stock.

     In January 1999, the Company received $500.0 million in cash from Microsoft
Corp. ("Microsoft") in exchange for 500,000 shares of the Company's 5.25%
Convertible Preferred Stock (the "5.25% Preferred Stock") and warrants to
purchase 1.9 million shares of the Company's common stock at an exercise price
of $53.76 per share. Dividends were payable quarterly at the Company's option in
cash, common stock or additional shares of preferred stock. The Company issued
approximately 25,000 shares of 5.25% Preferred Stock for dividend payments of
$24.6 million through December 31, 1999. In February 2000, all of the 5.25%
Preferred Stock was converted into 8.3 million shares of the Company's common
stock.

  SERIES PREFERRED STOCK

     In September 1998, the Company issued 125,000 shares of 9.9% Non-voting
Mandatorily Redeemable Preferred Stock, Series A (the "Series A Preferred
Stock") in connection with an acquisition. Each share of Series A Preferred
Stock had a stated value of $1,000. Cumulative dividends accrued at 9.9% of the
stated value per share. Dividends were payable when and if declared by the Board
of Directors. In December 1999, all of the outstanding shares of the Series A
Preferred Stock were redeemed for cash of $140.8 million, which included $15.5
million for accrued dividends.

     In December 1998, the Company issued 52,000 shares of 9.9% Non-voting
Mandatorily Redeemable Preferred Stock, Series B (the "Series B Preferred
Stock") in connection with an acquisition. Each share of Series B Preferred
Stock had a stated value of $1,000. Cumulative dividends accrued at 9.9% of the
stated value per share. Dividends were payable when and if declared by the Board
of Directors. In June 2000, all of the outstanding shares of the Series B
Preferred Stock were converted into 903,000 shares of the Company's common
stock.

     The 5% Preferred Stock has a stated value of $1,000 per share, is
convertible into common stock at a conversion price of $80 per share and is
redeemable ten years from the issue date, at the Company's option, for cash,
shares of common stock or a combination of both. The 5% Preferred Stock may be
redeemed by the Company on the earlier of seven years from the issue date or the
date that is both four years from the issue date and after the Company's common
stock has traded above $96 per share for 25 consecutive trading days. Dividends
are payable quarterly at the Company's option in cash, common stock or
additional shares of 5% Preferred Stock. As of December 31, 2001, the Company
has accrued $250.0 million for dividends and has issued approximately 213,000
shares for $213.0 million of such accrued dividends.

     At December 31, 2001, the 5% Preferred Stock would have been convertible
into an aggregate of 37.0 million shares of the Company's common stock.

                                       F-37
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The changes in the number of shares of Series Preferred Stock, excluding
the Redeemable Preferred Stock, were as follows:

<Table>
<Caption>
                                               9.9%       9.9%
                                             SERIES A   SERIES B    5.25%        5%
                                             --------   --------   --------   ---------
<S>                                          <C>        <C>        <C>        <C>
Balance, December 31, 1998.................   125,000    52,000          --          --
Issued for cash............................        --        --     500,000     750,000
Issued for dividends.......................        --        --      25,000       5,000
Redemption.................................  (125,000)       --          --          --
                                             --------   -------    --------   ---------
Balance, December 31, 1999.................        --    52,000     525,000     755,000
Issued for cash............................        --        --          --   2,000,000
Issued for dividends.......................        --        --       3,000     103,000
Conversion into common stock...............        --   (52,000)   (528,000)         --
                                             --------   -------    --------   ---------
Balance, December 31, 2000.................        --        --          --   2,858,000
Issued for dividends.......................        --        --          --     105,000
                                             --------   -------    --------   ---------
Balance, December 31, 2001.................        --        --          --   2,963,000
                                             ========   =======    ========   =========
</Table>

  WARRANTS

     The Company had the following warrants outstanding as of December 31, 2001:
(a) warrants to purchase an aggregate of 243,000 shares of common stock at
$15.22 per share issued in 1996 that expire in 2006 (256,000 were originally
issued), (b) warrants to purchase an aggregate of 997,000 shares of common stock
at $27.77 per share issued in 1998 that expire in 2008 (1,197,000 were
originally issued) and (c) warrants to purchase an aggregate of 1,875,000 shares
of common stock at $53.76 per share issued in 1999 that expire in 2004
(1,875,000 were originally issued).

  SHAREHOLDER RIGHTS PLAN

     The Rights Agreement provides that .48 of a Right will be issued with each
share of common stock issued on or after October 13, 1993. The Rights are
exercisable upon the occurrence of certain potential takeover events and will
expire in October 2003 unless previously redeemed by the Company. When
exercisable, each Right entitles the owner to purchase from the Company one
one-hundredth of a share of Series A Junior Participating Preferred Stock
("Rights Preferred Stock") at a purchase price of $100.

     The Rights Preferred Stock will be entitled to a minimum preferential
quarterly dividend payment of $.01 per share and will be entitled to an
aggregate dividend of 208.33 times the dividend, if any, declared per share of
common stock. In the event of liquidation, the holders of Rights Preferred Stock
will be entitled to a minimum preferential liquidation payment of $1 per share
and will be entitled to an aggregate payment of 208.33 times the payment made
per share of common stock. Each share of Rights Preferred Stock will have 208.33
votes and will vote together with the common stock. In the event of any merger,
consolidation or other transaction in which shares of common stock are changed
or exchanged, each share of Rights Preferred Stock will be entitled to receive
208.33 times the amount received per share of common stock. The Rights are
protected by customary antidilution provisions.

  STOCK OPTIONS

     There are 3,848,000 shares and 10,396,000 shares of common stock reserved
for issuance under the 1991 Stock Option Plan and the 1993 Stock Option Plan,
respectively. These plans provide that incentive stock options ("ISOs") be
granted at the fair market value of the Company's common stock on the date of
grant,

                                       F-38
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

and nonqualified stock options ("NQSOs") be granted at not less than 85% of the
fair market value of the Company's common stock on the date of grant. Options
are exercisable as to 20% of the shares subject thereto on the date of grant and
become exercisable as to an additional 20% of the shares subject thereto on each
January 1 thereafter, while the optionee remains an employee of the Company.
Options will expire ten years after the date of the grant. No additional options
will be granted under these plans.

     There are 156,000 shares and 500,000 shares of common stock reserved for
issuance under 1991 and 1993 Non-Employee Director Stock Option Plans,
respectively. Under the terms of these plans, options will be granted to members
of the Board of Directors who are not employees of the Company or any of its
affiliates. These plans provide that all options be granted at the fair market
value of the Company's common stock on the date of grant, and options will
expire ten years after the date of the grant. Options are exercisable as to 20%
of the shares subject thereto on the date of grant and become exercisable as to
an additional 20% of the shares subject thereto on each subsequent anniversary
of the grant date while the optionee remains a director of the Company. Options
will expire ten years after the date of the grant. No additional options will be
granted under these plans.

     There are 83,438,000 shares of common stock reserved for issuance under the
1998 Non-Qualified Stock Option Plan, and there are 19,684,000 shares available
for issuance at December 31, 2001. The exercise price of a NQSO shall be
determined by the Compensation and Option Committee. Options are generally
exercisable ratably over five to ten years while the optionee remains an
employee of the Company. Options will expire ten years after the date of the
grant.

     In December 2000, the Board of Directors approved the rescission of the
exercise of ISOs for 156,000 shares of the Company's common stock, and the
Company returned cash of $1.1 million. The rescission was accounted for as a
modification of the original options that resulted in a new measurement date. On
the new measurement date the Company recognized no compensation expense.

     Pro forma information regarding net loss and net loss per share is required
by SFAS No. 123, and has been determined as if the Company had accounted for its
employee stock options under the fair value method of that Statement. The fair
value for these options was estimated at the date of grant using the
Black-Scholes option pricing model with the following weighted-average
assumptions for 2001, 2000 and 1999: risk-free interest rates of 4.47%, 5.30%
and 6.81%, respectively, dividend yield of 0%, volatility factor of the expected
market price of the Company's common stock of .702, .385 and .336, respectively,
and a weighted-average expected life of the option of 10 years.

     The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting restrictions
and are fully transferable. In addition, option valuation models require the
input of highly subjective assumptions including the expected stock price
volatility. Because the Company's stock options have characteristics
significantly different from those of traded options and because changes in the
subjective input assumptions can materially affect the fair value estimate, in
management's opinion, the existing models do not necessarily provide a reliable
single measure of the fair value of its stock options.

     For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period. The effects of
applying SFAS No. 123 on pro forma disclosures of net loss and net loss per
share for the years ended December 31, 2001, 2000 and 1999 are not likely to be
representative of the

                                       F-39
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

pro forma effects on net loss and net loss per share in future years. Following
is the Company's pro forma information:

<Table>
<Caption>
                                                             YEAR ENDED DECEMBER 31,
                                                      --------------------------------------
                                                          2001          2000         1999
                                                      ------------   -----------   ---------
                                                       (IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                                   <C>            <C>           <C>
Pro forma net (loss)................................   $(14,509.6)    $(3,220.3)    $(822.7)
Basic and diluted pro forma net (loss) per share....       (53.75)       (15.73)      (7.51)
</Table>

     A summary of the Company's stock option activity and related information
for the years ended December 31 follows:

<Table>
<Caption>
                                 2001                        2000                        1999
                       -------------------------   -------------------------   -------------------------
                                       WEIGHTED-                   WEIGHTED-                   WEIGHTED-
                                        AVERAGE                     AVERAGE                     AVERAGE
                         NUMBER OF     EXERCISE      NUMBER OF     EXERCISE      NUMBER OF     EXERCISE
                          OPTIONS        PRICE        OPTIONS        PRICE        OPTIONS        PRICE
                       -------------   ---------   -------------   ---------   -------------   ---------
                       (IN MILLIONS)               (IN MILLIONS)               (IN MILLIONS)
<S>                    <C>             <C>         <C>             <C>         <C>             <C>
Outstanding --
  beginning of year..      61.4         $41.52         29.2         $24.60         25.7         $17.29
Granted..............      14.3          12.55         34.8          54.90          6.4          50.35
Exercised............      (1.1)         11.93         (2.1)         17.13         (2.6)         15.95
Forfeited............      (2.7)         42.46         (0.5)         83.31         (0.3)         24.22
                           ----                        ----                        ----
Outstanding -- end of
  year...............      71.9         $36.13         61.4         $41.52         29.2         $24.60
                           ====                        ====                        ====
Exercisable at end of
  year...............      24.7         $27.50         16.3         $21.82         12.2         $14.97
                           ====                        ====                        ====
</Table>

     Weighted-average fair value of options, calculated using the Black-Scholes
option pricing model, granted during 2001, 2000 and 1999 is $5.69, $32.19 and
$30.97 respectively.

     The following table summarizes the status of the stock options outstanding
and exercisable at December 31, 2001:

<Table>
<Caption>
                                      STOCK OPTIONS OUTSTANDING          STOCK OPTIONS EXERCISABLE
                               ---------------------------------------   -------------------------
                                                WEIGHTED-    WEIGHTED-                   WEIGHTED-
                                                REMAINING     AVERAGE                     AVERAGE
RANGE OF                         NUMBER OF     CONTRACTUAL   EXERCISE      NUMBER OF     EXERCISE
EXERCISE PRICES                   OPTIONS         LIFE         PRICE        OPTIONS        PRICE
---------------                -------------   -----------   ---------   -------------   ---------
                               (IN MILLIONS)                             (IN MILLIONS)
<S>                            <C>             <C>           <C>         <C>             <C>
$ 0.35 to $ 9.36.............       4.4         4.1 Years     $ 5.434         4.4         $ 5.434
$10.00 to $18.40.............      15.4         5.2 Years     $11.153         5.9         $12.972
$19.86 to $27.84.............      13.5         7.6 Years     $23.384         5.7         $23.226
$28.06 to $35.64.............       0.7         7.3 Years     $30.711         0.4         $30.811
$36.12 to $40.19.............       0.9         8.2 Years     $38.601         0.3         $38.650
$42.44 to $47.44.............      14.5         8.4 Years     $44.444         3.1         $44.401
$48.38 to $53.76.............       4.9         7.6 Years     $50.373         2.5         $50.390
$57.60 to $63.63.............      17.1         7.8 Years     $63.416         2.2         $62.587
$68.20 to $75.56.............       0.1         8.1 Years     $75.413         0.1         $75.397
$91.13 to $97.50.............       0.4         8.1 Years     $93.713         0.1         $93.713
                                   ----                                      ----
Total........................      71.9                                      24.7
                                   ====                                      ====
</Table>

                                       F-40
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     As of December 31, 2001, the Company had 173.6 million shares of its common
stock reserved for issuance upon the exercise of warrants and stock options and
the conversion of debt and preferred stock.

18.  EMPLOYEE BENEFIT PLANS

     Certain subsidiaries of the Company operate defined benefit pension plans
in the UK and Switzerland. The assets of the Plans are held separately from
those of the Company and are invested in specialized portfolios under the
management of an investment group. The pension cost is calculated using the
attained age method. The Company's policy is to fund amounts to the defined
benefit plans necessary to comply with the funding requirements as prescribed by
the laws and regulations in the UK and Switzerland.

     At December 31, 2001, the projected benefit obligations of Cablecom's and
NTL Business' defined benefit pension plans exceeded the fair value of its
respective plan assets by $3.4 million and $3.0 million, respectively.

<Table>
<Caption>
                                                            YEAR ENDED DECEMBER 31,
                                                        -------------------------------
                                                             2001             2000
                                                        --------------   --------------
                                                                 (IN MILLIONS)
<S>                                                     <C>              <C>
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at beginning of year...............  $        324.1   $        197.1
Acquisition...........................................              --            116.9
Service cost..........................................            17.3             16.7
Interest cost.........................................            16.8             16.8
Actuarial losses (gains)..............................             5.4             (3.4)
Benefits paid.........................................            (9.3)            (8.3)
Foreign currency exchange rate changes................            (8.2)           (11.7)
                                                        --------------   --------------
Benefit obligation at end of year.....................  $        346.1   $        324.1
                                                        ==============   ==============
CHANGE IN PLAN ASSETS
Fair value of plan assets at beginning of year........  $        420.2   $        278.4
Acquisition...........................................              --            133.2
Actual return on plan assets..........................           (46.0)            15.8
Company contributions.................................            12.4             12.5
Plan participants' contributions......................             6.5              6.2
Benefits paid.........................................            (9.4)            (8.3)
Foreign currency exchange rate changes................           (12.1)           (17.6)
                                                        --------------   --------------
Fair value of plan assets at end of year..............  $        371.6   $        420.2
                                                        ==============   ==============
Funded status of the plan.............................  $         25.5   $         96.1
Unrecognized net actuarial losses (gains).............             5.4            (79.2)
Unrecognized transition obligation....................             5.8              6.2
                                                        --------------   --------------
Prepaid benefit cost..................................  $         36.7   $         23.1
                                                        ==============   ==============
Actuarial assumptions:
  Weighted average discount rate......................   4.50% - 6.00%    4.50% - 6.00%
  Weighted average rate of compensation increase......   2.00% - 4.00%    2.00% - 4.25%
  Expected long-term rate of return on plan assets....   5.50% - 7.50%    5.50% - 7.75%
</Table>

                                       F-41
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The components of net pension costs are as follows:

<Table>
<Caption>
                                                             YEAR ENDED DECEMBER 31,
                                                             ------------------------
                                                              2001     2000     1999
                                                             ------   ------   ------
                                                              (IN MILLIONS)
<S>                                                          <C>      <C>      <C>
Service cost...............................................  $ 17.3   $ 16.7   $ 12.0
Interest cost..............................................    16.8     16.8     12.0
Actual return on plan assets...............................    46.0    (15.7)   (43.1)
Net amortization and deferral..............................   (79.5)   (19.4)    26.8
                                                             ------   ------   ------
                                                             $  0.6   $ (1.6)  $  7.7
                                                             ======   ======   ======
</Table>

19.  LEASES

     Certain of the Company's facilities and equipment are leased under
operating or capital leases.

     A summary of assets held under capital lease are as follows (in millions):

<Table>
<Caption>
                                                               DECEMBER 31,
                                                              ---------------
                                                               2001     2000
                                                              ------   ------
<S>                                                           <C>      <C>
Land, buildings and equipment...............................  $100.3   $ 95.8
Less: accumulated depreciation..............................   (28.5)   (22.2)
                                                              ------   ------
                                                              $ 71.8   $ 73.6
                                                              ======   ======
</Table>

     Future minimum annual payments at December 31, 2001 are as follows (in
millions). The table reflects the Company's contractual obligations, but the
entire obligation has been classified as current.

<Table>
<Caption>
                                                              CAPITAL   OPERATING
                                                              LEASES     LEASES
                                                              -------   ---------
<S>                                                           <C>       <C>
Year ending December 31:
  2002......................................................  $   9.3    $ 64.5
  2003......................................................      8.2      60.8
  2004......................................................      7.4      59.1
  2005......................................................      6.5      56.7
  2006......................................................      6.2      55.4
  Thereafter................................................    155.2     416.0
                                                              -------    ------
Total minimum lease payments................................    192.8    $712.5
                                                              =======    ======
Less: amount representing interest..........................   (129.8)
                                                              -------
Present value of net minimum obligations....................     63.0
Less: current portion.......................................    (63.0)
                                                              -------
                                                              $    --
                                                              =======
</Table>

     Leases for buildings, office space and equipment extend through 2031. Total
rental expense for the years ended December 31, 2001, 2000 and 1999 under
operating leases was $90.9 million, $56.2 million and $36.7 million,
respectively.

                                       F-42
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

20.  COMMITMENTS AND CONTINGENT LIABILITIES

     At December 31, 2001, the Company was committed to pay approximately
$1,672.0 million for equipment and services and for investments in and loans to
affiliates. This amount includes approximately $1,238.0 million for operations
and maintenance and other commitments through 2013.

     The Company has agreed to provide funds to its unconsolidated affiliates
generally if and when requested to do so and only upon the satisfaction of
certain conditions. The estimated aggregate amount as of December 31, 2001 was
$73.9 million. These unconsolidated affiliates include the media partnerships
with the Football League and with various UK football clubs for Internet
marketing and sponsorships. The Company's wholly-owned indirect subsidiary,
Premium TV Limited, has entered into these football related partnerships.

     The Company had certain exclusive local delivery operator licenses for
Northern Ireland and other franchise areas in the UK. Pursuant to these
licenses, various subsidiaries of the Company were required to make monthly cash
payments to the Independent Television Commission ("ITC") during the 15-year
license terms. Upon a request by the Company in 1999, the ITC converted all of
the Company's fee bearing exclusive licenses to non-exclusive licenses by the
end of 1999. In 1999, the Company paid $30.1 million in connection with these
licenses. Since the Company's liability for the license payments ceased upon the
conversion, in 1999 the Company reversed an accrual for franchise fees of $13.6
million.

     The Company is involved in certain disputes and litigation arising in the
ordinary course of its business. None of these matters are expected to have a
material adverse effect on the Company's financial position, results of
operations or cash flows.

21.  INDUSTRY SEGMENTS

     The Company has four reportable segments: Broadcast Services, Consumer
Services, Business Services and Shared Services. The Broadcast Services segment
operates in the UK and Australia and includes digital and analog television and
radio broadcasting, rental of antenna space on the Company's owned and leased
towers and sites and associated services, and satellite and media services.
Consumer Services include telephony, cable television, Internet access and
interactive services in regional franchise areas in the UK, Ireland, France and
Switzerland. The Business Services segment operates primarily in the UK and
includes telephony, national and international wholesale carrier
telecommunications, and radio communications services to the emergency services
community. Shared Services principally include network and information
technology management, finance, human resources and facilities management.
Shared Services also includes assets and related depreciation and amortization
that are not allocated to another segment.

     The accounting policies of the segments are the same as those described in
the Significant Accounting Policies note. The Company's management evaluates
segment performance based on various financial and non-financial measurements.
The Company's primary measure of profit or loss is EBITDA. The results of
operations data utilized in financial measurements are revenues and EBITDA,
which is earnings before interest, taxes, depreciation and amortization,
franchise fees, non-cash compensation, other charges, corporate expenses, asset
impairments, share of (losses) from equity investments, other (losses) gains,
foreign currency transactions gains (losses) and extraordinary items. Certain
selling, general and administrative expenses are allocated to segments based on
revenues. Management does not allocate costs of shared services departments and
jointly used assets for purposes of measuring segment performance. The
reportable segments are strategic business units that are managed separately and
offer different services.

     The Company's primary measure of profit or loss for each reportable segment
is EBITDA as defined above. The Company considers EBITDA an important indicator
of the operational strength and performance of its reportable segments,
including the ability to provide cash flows to service debt and fund capital
expenditures. EBITDA excludes the impact of costs and expenses that do not
directly effect cash flows such as depreciation, amortization, asset
impairments, non-cash compensation and share of (losses) from equity
                                       F-43
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

investments. The Company also excludes costs and expenses that are not directly
related to the performance of a single reportable segment from EBITDA rather
than allocate these costs and expenses to multiple reportable segments. Other
charges, corporate expenses, franchise fees and foreign currency transactions
are not directly related to a single segment. EBITDA should be considered in
addition to, not as a substitute for, operating (loss), net (loss) and other
measures of financial performance reported in accordance with generally accepted
accounting principles.

<Table>
<Caption>
                                   BROADCAST   CONSUMER    BUSINESS    SHARED      TOTAL
                                   ---------   ---------   --------   --------   ---------
                                                        (IN MILLIONS)
<S>                                <C>         <C>         <C>        <C>        <C>
YEAR ENDED DECEMBER 31, 2001
Revenues.........................  $  344.0    $ 2,514.6   $  840.6   $     --   $ 3,699.2
Depreciation and amortization....     109.3      2,431.8      587.9       41.5     3,170.5
EBITDA(1)........................     170.6        774.2      335.2     (571.7)      708.3
Expenditures for long-lived
  assets.........................     145.2      1,373.2      172.1      599.5     2,290.0
Total assets(2)..................   1,206.8     11,395.9    3,289.7      941.8    16,834.2
YEAR ENDED DECEMBER 31, 2000
Revenues.........................  $  318.8    $ 1,819.8   $  702.2   $     --   $ 2,840.8
Depreciation and amortization....      88.3      1,825.6      184.2       24.7     2,122.8
EBITDA(1)........................     151.9        447.6      226.2     (481.6)      344.1
Expenditures for long-lived
  assets.........................     102.6      1,822.3      724.6      281.5     2,931.0
Total assets(3)..................   1,219.4     22,672.6    3,746.0      745.7    28,383.7
YEAR ENDED DECEMBER 31, 1999
Revenues.........................  $  297.3    $   834.3   $  452.5   $     --   $ 1,584.1
Depreciation and amortization....      76.8        581.3      104.1       29.1       791.3
EBITDA(1)........................     150.1        233.5      106.6     (279.3)      210.9
Expenditures for long-lived
  assets.........................      74.5        591.3      356.7      131.8     1,154.3
Total assets(4)..................   1,167.7      6,783.2    1,319.1    2,941.6    12,211.6
</Table>

---------------

(1) Represents earnings before interest, taxes, depreciation and amortization,
    franchise fees, non-cash compensation, other charges, corporate expenses,
    asset impairments, share of (losses) from equity investments, other (losses)
    gains, foreign currency transaction (losses) gains and extraordinary items.

(2) At December 31, 2001, shared assets included $318.0 million of cash and cash
    equivalents, $0.1 million of goodwill and $623.7 million of other assets.

(3) At December 31, 2000, shared assets included $487.1 million of cash, cash
    equivalents and marketable securities, $0.3 million of goodwill and $258.3
    million of other assets.

(4) At December 31, 1999, shared assets included $2,669.4 million of cash, cash
    equivalents and marketable securities and $272.2 million in other assets.

                                       F-44
<PAGE>
                       NTL INCORPORATED AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The reconciliation of segment combined EBITDA to loss before income taxes
and extraordinary item is as follows:

<Table>
<Caption>
                                                          YEAR ENDED DECEMBER 31,
                                                      --------------------------------
                                                         2001        2000       1999
                                                      ----------   ---------   -------
                                                               (IN MILLIONS)
<S>                                                   <C>          <C>         <C>
Segment Combined EBITDA.............................  $    708.3   $   344.1   $ 210.9
(Add) Deduct:
  Franchise fees....................................          --          --      16.5
  Non-cash compensation.............................        30.6          --        --
  Other charges.....................................       311.7        92.7      16.2
  Corporate expenses................................        66.8        47.5      29.4
  Asset impairments.................................     9,072.7          --        --
  Depreciation......................................     1,549.7       996.6     490.3
  Amortization......................................     1,620.8     1,126.2     301.0
  Interest income and other, net....................       (51.1)      (72.5)    (67.8)
  Interest expense..................................     1,440.9     1,036.8     680.7
  Share of losses from equity investments...........       683.2        70.9      18.4
  Other losses (gains)..............................       147.4          --    (493.1)
  Foreign currency transaction losses (gains).......        13.7       120.6     (12.7)
                                                      ----------   ---------   -------
                                                        14,886.4     3,418.8     978.9
                                                      ----------   ---------   -------
Loss before income taxes and extraordinary item.....  $(14,178.1)  $(3,074.7)  $(768.0)
                                                      ==========   =========   =======
</Table>

22.  GEOGRAPHIC INFORMATION

<Table>
<Caption>
                                     UNITED
                                     STATES      UK       SWITZERLAND   OTHER      TOTAL
                                     ------   ---------   -----------   ------   ---------
                                                         (IN MILLIONS)
<S>                                  <C>      <C>         <C>           <C>      <C>
2001
  Revenues.........................  $  --    $ 3,170.3    $  393.5     $135.4   $ 3,699.2
  Long-lived assets................   17.3     11,844.8     2,630.9      788.1    15,281.1
2000
  Revenues.........................  $  --    $ 2,434.8    $  277.3     $128.7   $ 2,840.8
  Long-lived assets................   26.7     21,751.7     3,839.8      974.1    26,592.3
1999
  Revenues.........................  $  --    $ 1,508.2    $     --     $ 75.9   $ 1,584.1
  Long-lived assets................    1.6      8,227.6          --      663.8     8,893.0
</Table>

23.  SUBSEQUENT EVENT

     On April 2, 2002, the Company announced that it completed the sale of its
Australian broadcast business to Macquarie Bank for A$850.0 million ($434.9
million) in an all cash transaction. The net proceeds from the sale after the
repayment of the outstanding bank credit facility and transaction related costs
were approximately A$574.0 million ($293.7 million).

                                       F-45
<PAGE>

                                NTL INCORPORATED

          SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                            CONDENSED BALANCE SHEETS

<Table>
<Caption>
                                                                   DECEMBER 31,
                                                              ----------------------
                                                                 2001        2000
                                                              ----------   ---------
                                                                  (IN MILLIONS)
<S>                                                           <C>          <C>
ASSETS
Current assets:
  Cash and cash equivalents.................................  $    124.3   $    69.2
  Marketable securities.....................................          --        60.0
  Other.....................................................         1.0         0.9
                                                              ----------   ---------
Total current assets........................................       125.3       130.1
Investments in and loans to affiliates, net.................          --    10,326.9
Deferred financing costs, net of accumulated amortization of
  $0.2 (2001) and none (2000)...............................         3.9          --
Note receivable from CoreComm Limited, net of allowance of
  $7.0......................................................         9.2          --
                                                              ----------   ---------
Total assets................................................  $    138.4   $10,457.0
                                                              ==========   =========
LIABILITIES AND SHAREHOLDERS' (DEFICIENCY) EQUITY
Current liabilities.........................................  $    142.3   $     6.4
Investments in and loans to affiliates, net.................     3,764.8          --
Redeemable preferred stock..................................     2,773.7     2,083.2
Shareholders' (deficiency) equity:
  Series preferred stock....................................          --          --
  Common stock..............................................         2.8         2.7
  Additional paid-in capital................................    13,720.0    13,764.7
  Accumulated other comprehensive (loss)....................    (1,072.8)     (448.9)
  (Deficit).................................................   (19,192.4)   (4,951.1)
                                                              ----------   ---------
                                                                (6,542.4)    8,367.4
                                                              ----------   ---------
Total liabilities and shareholders' (deficiency) equity.....  $    138.4   $10,457.0
                                                              ==========   =========
</Table>

                            See accompanying notes.
                                       F-46
<PAGE>

                                NTL INCORPORATED

          SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF REGISTRANT

                       CONDENSED STATEMENTS OF OPERATIONS

<Table>
<Caption>
                                                                                  FOR THE PERIOD FROM
                                                                 YEAR ENDED         MAY 18, 2000 TO
                                                              DECEMBER 31, 2001    DECEMBER 31, 2000
                                                              -----------------   -------------------
                                                                           (IN MILLIONS)
<S>                                                           <C>                 <C>
COSTS AND EXPENSES
Asset impairments...........................................     $    426.3            $      --
Corporate expenses..........................................           29.4                  9.4
Amortization................................................            0.2                   --
                                                                 ----------            ---------
Operating (loss)............................................         (455.9)                (9.4)
OTHER INCOME (EXPENSE)
Interest income and other, net..............................            4.7                 10.9
Interest expense............................................           (5.3)                  --
Foreign currency transaction (losses) gains.................           (0.4)                 1.9
                                                                 ----------            ---------
(Loss) income before income taxes and equity in net (loss)
  of affiliates.............................................         (456.9)                 3.4
Income tax expense..........................................             --                 (0.2)
                                                                 ----------            ---------
(Loss) income before equity in net (loss) of affiliates.....         (456.9)                 3.2
Equity in net (loss) of subsidiaries........................      (13,784.4)            (2,966.9)
                                                                 ----------            ---------
Net (loss)..................................................      (14,241.3)            (2,963.7)
Preferred stock dividend....................................         (325.7)              (194.0)
                                                                 ----------            ---------
Net (loss) available to common shareholders.................     $(14,567.0)           $(3,157.7)
                                                                 ==========            =========
</Table>

                            See accompanying notes.
                                       F-47
<PAGE>

                                NTL INCORPORATED

          SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF REGISTRANT

                       CONDENSED STATEMENTS OF CASH FLOWS

<Table>
<Caption>
                                                                                  FOR THE PERIOD FROM
                                                                 YEAR ENDED         MAY 18, 2000 TO
                                                              DECEMBER 31, 2001    DECEMBER 31, 2000
                                                              -----------------   -------------------
                                                                           (IN MILLIONS)
<S>                                                           <C>                 <C>
Net cash (used in) provided by operating activities.........       $ (6.2)             $     0.7
INVESTING ACTIVITIES
Purchase of marketable securities...........................           --                  (96.9)
Proceeds from sales of marketable securities................         60.3                  202.6
Contribution to subsidiary..................................           --                   (4.3)
Due from CoreComm Limited...................................        (15.0)                    --
Decrease in investments in and loans to affiliates..........        (92.9)              (4,229.3)
                                                                   ------              ---------
Net cash (used in) investing activities.....................        (47.6)              (4,127.9)
FINANCING ACTIVITIES
Proceeds from borrowings, net of financing costs............         95.9                     --
Proceeds from exercise of stock options and warrants........           --                    6.8
Proceeds from issuance of preferred stock...................           --                1,862.0
Proceeds from issuance of common stock......................         13.0                2,327.6
                                                                   ------              ---------
Net cash provided by financing activities...................        108.9                4,196.4
                                                                   ------              ---------
Increase in cash and cash equivalents.......................         55.1                   69.2
Cash and cash equivalents at beginning of period............         69.2                     --
                                                                   ------              ---------
Cash and cash equivalents at end of period..................       $124.3              $    69.2
                                                                   ======              =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for interest....................       $  3.1              $      --
SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES
Accretion of dividends and discount on preferred stock......       $220.8              $    78.1
Conversion of Convertible Notes, net of unamortized deferred
  financing costs...........................................        128.3                     --
Common stock and stock options issued for acquisition.......          4.3                     --
Redeemable preferred stock issued for investment in
  affiliates................................................        518.0                     --
</Table>

                            See accompanying notes.
                                       F-48
<PAGE>

                                NTL INCORPORATED

        SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT
                    NOTES TO CONDENSED FINANCIAL STATEMENTS

1.  CORPORATE RESTRUCTURING

     On May 18, 2000, NTL Incorporated completed a corporate restructuring to
create a holding company structure. The holding company restructuring was
accomplished through a merger so that all the stockholders of NTL Incorporated
at the effective time of the merger became stockholders of the new holding
company, and NTL Incorporated became a subsidiary of the new holding company.
The new holding company has taken the name NTL Incorporated (the "Company") and
the holding company's subsidiary simultaneously changed its name to NTL
(Delaware), Inc.

2.  BASIS OF PRESENTATION

     In the Company's condensed financial statements, the Company's investment
in subsidiaries is stated at cost plus equity in the undistributed earnings of
the subsidiaries. The Company's share of net loss of its subsidiaries is
included in net loss using the equity method of accounting. The condensed
financial statements should be read in conjunction with the Company's
consolidated financial statements.

3.  REDEEMABLE PREFERRED STOCK

     Dividends on the Variable Coupon Redeemable Preferred Stock, Series A
("Variable Coupon Redeemable Preferred Stock") are payable quarterly at the
Company's option in cash or additional shares of Variable Coupon Redeemable
Preferred Stock at a quarterly rate based on a quotient of (x) the sum of (1)
the EURIBOR Rate in effect on the first day of every dividend period plus (2)
2.5% over (y) four, per share. The Variable Coupon Redeemable Preferred Stock
has a stated value and liquidation preference of $10,000 per share and is
mandatorily redeemable for cash by the Company on May 18, 2002. The Company's
27% interest in Noos is pledged to France Telecom to secure the mandatory
redemption obligation under its Variable Coupon Redeemable Preferred Stock.

     Dividends on the 6.5% Fixed Coupon Redeemable Preferred Stock, Series A
("6.5% Redeemable Preferred Stock") are cumulative and are payable in cash upon
redemption. The 6.5% Redeemable Preferred Stock has a stated value and
liquidation preference of $10,000 per share and is mandatorily redeemable for
cash by the Company on May 18, 2007.

     Dividends on the Cumulative Convertible Preferred Stock, Series A
("Convertible Preferred Stock") are payable quarterly in additional shares of
Convertible Preferred Stock, at the following quarterly dividend rates: (i) from
September 12, 2001 through March 26, 2002, $13.44 per share, (ii) from March 27,
2002 through March 26, 2003, $21.23 per share and (iii) from March 27, 2003
through March 26, 2004, $26.61 per share. Once the Convertibility Date (as
defined below) is set, the quarterly dividend rate resets to $16.12 per share
and the Convertible Preferred Stock becomes eligible for conversion into shares
of the Company's common stock beginning on a "Convertibility Date," at which
time the conversion price is set at 125% of the immediately preceding 25 trading
day volume-weighted average price of the Company's common stock (the
"Convertibility Base Price"). The Convertibility Date is as follows: March 27,
2002, unless the Company elects to delay convertibility until March 27, 2003 or,
alternatively, redeems, at its option, all shares of the Convertible Preferred
Stock on March 27, 2002 in cash; if the Company has delayed, March 27, 2003,
unless the Company elects again to delay convertibility until March 27, 2004,
which it may only do if the Convertibility Base Price would be less than or
equal to $65.00 per share (as may be adjusted for certain antidilutive events);
the Company may also elect, instead, to redeem all shares of the Convertible
Preferred Stock on March 27, 2003 in cash; if the Company has delayed, March 27,
2004, unless the Company elects to redeem all shares of the Convertible
Preferred Stock on March 27, 2004 in cash. In no event will the Convertibility
Date be after March 27, 2004. In March 2002, the company elected to delay the
Convertibility Date until at least March 27, 2003. The Convertible Preferred
Stock has a stated value and liquidation preference of $1,075.17 per share and
is mandatorily redeemable for cash by the Company on March 27, 2009.
                                       F-49
<PAGE>
                                NTL INCORPORATED

        SCHEDULE I -- CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT
             NOTES TO CONDENSED FINANCIAL STATEMENTS -- (CONTINUED)

Holders of Convertible Preferred Stock other than any commercial bank or their
affiliates may at any time elect, subject to some conditions, to exchange their
Convertible Preferred Stock for up to a 50% interest in an entity holding the
Company's Swiss operations.

     Dividends on the 13% Senior Redeemable Exchangeable Preferred Stock (the
"Redeemable Preferred Stock") accrue at 13% per annum ($130 per share) and are
payable quarterly in arrears. Dividends accruing on or prior to February 15,
2004 may, at the option of the Company, be paid in cash, by the issuance of
additional Redeemable Preferred Stock or in any combination of the foregoing.
The Redeemable Preferred Stock may be redeemed, at the Company's option, in
whole or in part, at any time after February 15, 2002 at a redemption price of
106.5% of the liquidation preference of $1,000 per share that declines annually
to 100% in 2005, in each case together with accrued and unpaid dividends to the
redemption date. The Redeemable Preferred Stock is subject to mandatory
redemption on February 15, 2009. On any scheduled dividend payment date, the
Company may, at its option, exchange all of the shares of Redeemable Preferred
Stock then outstanding for the Company's 13% Subordinated Exchange Debentures
due 2009.

4.  NOTE PAYABLE TO NTL COMMUNICATIONS CORP.

     On September 28, 2001, NTL Communications Corp., a wholly-owned indirect
subsidiary of the Company, loaned the Company $150.0 million in cash and
received 15.0% Promissory Notes due September 30, 2004. Interest is payable
monthly in cash at a rate of 15.0% per annum beginning on October 31, 2001. The
loan is included in investments in and loans to affiliates.

5.  OTHER

     No cash dividends were paid to the registrant by subsidiaries for the year
ended December 31, 2001 and for the period from May 18, 2000 to December 31,
2000.

     The Company is a joint obligor for the NTL (Delaware), Inc. 5 3/4%
Convertible Subordinated Notes due December 15, 2009 and for the NTL
Communications Corp. 7% Convertible Subordinated Notes due December 15, 2008.
The Company is a co-obligor on a subordinated basis for the NTL Communications
Corp. 6 3/4% Convertible Senior Notes due May 15, 2008.

                                       F-50
<PAGE>

                       NTL INCORPORATED AND SUBSIDIARIES

                SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS

<Table>
<Caption>
COL. A                               COL. B                 COL. C                  COL. D         COL. E
--------------------------------  ------------    ---------------------------    -------------    ---------
                                                           ADDITIONS
                                                  ---------------------------
                                                                     (2)
                                                     (1)         CHARGED TO
                                   BALANCE AT     CHARGED TO        OTHER        (DEDUCTIONS)/     BALANCE
                                  BEGINNING OF    COSTS AND      ACCOUNTS --       ADDITIONS       AT END
DESCRIPTION                          PERIOD        EXPENSES       DESCRIBE         DESCRIBE       OF PERIOD
--------------------------------  ------------    ----------    -------------    -------------    ---------
                                                                (IN MILLIONS)
<S>                               <C>             <C>           <C>              <C>              <C>
Year ended December 31, 2001
  Allowance for doubtful
     accounts...................     $141.4         $60.7           $ --            $(68.3)(a)     $133.8
                                     ======         =====           ====            ======         ======
  Allowance for loans
     receivable.................     $   --         $37.2           $ --            $   --         $ 37.2
                                     ======         =====           ====            ======         ======
Year ended December 31, 2000
  Allowance for doubtful
     accounts...................     $ 85.6         $98.9           $ --            $(43.1)(b)     $141.4
                                     ======         =====           ====            ======         ======
Year ended December 31, 1999
  Allowance for doubtful
     accounts...................     $ 38.5         $46.2           $ --            $0.9(c)        $ 85.6
                                     ======         =====           ====            ======         ======
</Table>

---------------

(a) Uncollectible accounts written-off, net of recoveries of $64.3 million and
    $4.0 million foreign currency translation adjustments.

(b) Uncollectible accounts written-off, net of recoveries of $90.4 million and
    $5.5 million foreign exchange currency translation adjustments, offset by
    $52.8 million allowance for doubtful accounts as of acquisition dates of
    purchased subsidiaries.

(c) Uncollectible accounts written-off, net of recoveries of $15.6 million and
    $1.2 million foreign exchange currency translation adjustments, offset by
    $17.7 million allowance for doubtful accounts as of acquisition dates of
    purchased subsidiaries.

                                       F-51