UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q


þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the quarterly period ended June 30, 2005

OR

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the transition period from to

Commission File Number: 333-112694

Dex Media West LLC

(Exact name of registrant as specified in its charter)


Delaware		25-1903487
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

198 Inverness Drive West

Englewood, Colorado

80112

(Address of principal executive offices)

(303) 784-2900

(Registrant’s telephone number, including area code)

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 þ No o

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

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT.

TABLE OF CONTENTS


		Page
		No.

PART I: FINANCIAL INFORMATION			2
Item 1.	Financial Statements		2
	Condensed Consolidated Balance Sheets (unaudited) — June 30, 2005 and December 31, 2004		2
	Condensed Consolidated Statements of Operations (unaudited) — Three months and six months ended June 30, 2005 and 2004		3
	Condensed Consolidated Statements of Cash Flows (unaudited) — Six months ended June 30, 2005 and 2004		4
	Notes to Condensed Consolidated Financial Statements (unaudited)		5
Item 2.	Management’s Narrative Analysis of Results of Operations*		14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		22
Item 4.	Controls and Procedures		22
PART II: OTHER INFORMATION			23
Item 1.	Legal Proceedings		23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		23
Item 3.	Defaults Upon Senior Securities		23
Item 4.	Submission of Matters to a Vote of Security Holders		23
Item 5.	Other Information		23
Item 6.	Exhibits		23
Signature			25
Fourth Amendment to the Credit Agreement
Certification of CEO Pursuant to Section 302
Certification of CFO Pursuant to Section 302


*	Pursuant to General Instructions H(2)(a) of Form 10-Q: (i) the information called for by Item 2 of Part I, Management’s Discussion and Analysis of Financial Condition and Results of Operations, has been omitted and (ii) the registrant is providing a management’s narrative analysis of results of operations.

PART I.

FINANCIAL INFORMATION


Item 1.	*Financial Statements*

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(Unaudited)


			As of		As of
			June 30,		December 31,
			2005		2004

ASSETS
Current assets
	Cash and cash equivalents		$	—	$	8,933
	Accounts receivable, net			65,890		48,109
	Deferred directory costs			165,520		155,819
	Current deferred income taxes			26,897		5,265
	Other current assets			9,092		7,259

		Total current assets		267,399		225,385
Property, plant and equipment, net				50,948		50,721
Goodwill				2,190,715		2,190,715
Intangible assets, net				1,573,975		1,669,985
Deferred income taxes				—		10,438
Deferred financing costs				67,342		75,962
Other assets				1,426		1,636

		Total Assets	$	4,151,805	$	4,224,842


LIABILITIES AND OWNER’S EQUITY
Current liabilities:
	Accounts payable		$	13,335	$	9,398
	Employee compensation			1,897		—
	Amounts due to affiliate			20,249		30,022
	Deferred revenue and customer deposits			118,458		111,068
	Accrued interest payable			46,500		43,739
	Current portion of long-term debt			146,597		84,302
	Other accrued liabilities			6,116		8,295

		Total current liabilities		353,152		286,824
Long-term debt				2,652,477		2,836,498
Post-retirement obligations				8,713		—
Amounts due to affiliate related to post-retirement obligations				36,714		42,252
Deferred income taxes				33,689		—
Other liabilities				40		135

		Total Liabilities		3,084,785		3,165,709

Commitments and contingencies (Note 9)
Owner’s interest				1,067,020		1,084,327
Accumulated deficit				—		(25,194	)

		Total Owner’s Equity		1,067,020		1,059,133

		Total Liabilities and Owner’s Equity	$	4,151,805	$	4,224,842

See accompanying notes to condensed consolidated financial statements.

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands)

(Unaudited)


			Three Months Ended						Six Months Ended
			June 30,						June 30,

			2005			2004			2005			2004

Revenue			$	235,347		$	216,895		$	465,812		$	424,283
Operating expenses:
	Cost of revenue			70,785			66,913			140,529			129,735
	General and administrative expense			26,071			23,708			49,669			46,458
	Bad debt expense			5,889			5,719			10,956			11,827
	Depreciation and amortization expense			4,440			4,245			8,463			8,084
	Amortization of intangibles			48,005			57,829			96,010			115,658

		Total operating expenses		155,190			158,414			305,627			311,762

		Operating income		80,157			58,481			160,185			112,521
Other (income) expense:
	Interest income			(538	)		(185	)		(705	)		(328	)
	Interest expense			47,715			52,723			104,404			107,899
	Other income, net			(1,122	)		—			(1,090	)		—

		Income before income taxes		34,102			5,943			57,576			4,950
Income tax provision				13,331			2,358			22,497			1,964

		Net income	$	20,771		$	3,585		$	35,079		$	2,986

See accompanying notes to condensed consolidated financial statements.

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

(Unaudited)


				Six Months Ended
				June 30,

				2005			2004

Operating activities:
	Net income			$	35,079		$	2,986
	Adjustments to net income:
		Bad debt expense			10,956			11,827
		Depreciation and amortization expense			8,463			8,084
		Amortization of intangibles			96,010			115,658
		Amortization of deferred financing costs			10,750			13,108
		Stock-based compensation expense			514			177
		Loss on disposition of assets			28			9
		Deferred tax provision			22,497			1,964
	Changes in operating assets and liabilities:
		Accounts receivable			(28,737	)		(18,852	)
		Deferred directory costs			(9,701	)		(20,698	)
		Other current assets			(1,833	)		2,554
		Other long term assets			210			—
		Accounts payable and other liabilities			1,685			(954	)
		Accrued interest			2,761			(6,012	)
		Deferred revenue and customer deposits			7,390			48,158
		Amounts due to affiliates			(7,805	)		(26,676	)
		Employee benefit plan obligations			577			—
		Other long-term liabilities			(95	)		(383	)
		Amounts due to affiliate related to post-retirement benefits			2,598			3,242

			Cash provided by operating activities		151,347			134,192

Investing activities:
	Expenditures for property, plant and equipment				(1,672	)		(3,795	)
	Capitalized software development costs				(7,046	)		(17,156	)
	Acquisition of Dex West				—			5,251

			Cash used for investing activities		(8,718	)		(15,700	)

Financing activities:
	Proceeds from borrowings on revolving credit facility				79,500			23,000
	Repayments of borrowings on revolving credit facility				(36,000	)		(23,000	)
	Payments on long-term debt				(165,226	)		(108,000	)
	Payment of financing costs				(2,130	)		(1,659	)
	Distribution to owner				(27,706	)		(11,689	)

			Cash used for financing activities		(151,562	)		(121,348	)

Cash and cash equivalents:
	Decrease				(8,933	)		(2,856	)
	Beginning balance				8,933			4,658

			Ending balance	$	—		$	1,802

Supplemental cash flow disclosures:
Interest paid				$	94,185		$	100,857

See accompanying notes to condensed consolidated financial statements.

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


1.	Description of business


*(a)*	*The Company*

Dex Media West LLC (“Dex Media West” or the “Company”) is a subsidiary of Dex Media West, Inc. and an indirect wholly-owned subsidiary of Dex Media, Inc. (“Dex Media”). Dex Media West is the exclusive official directory publisher for Qwest Corporation, the local exchange carrier of Qwest Communications International, Inc. (“Qwest”) in Arizona, Idaho, Montana, Oregon, Utah, Washington and Wyoming (collectively, the “Dex West States”).

Dex Media’s directory business was acquired from Qwest Dex, Inc. (“Qwest Dex”) in a two phase purchase between Dex Holdings LLC (“Dex Holdings”), the former parent of Dex Media and Qwest Dex. Dex Holdings and Dex Media were formed by two private equity firms: The Carlyle Group and Welsh, Carson, Anderson & Stowe (“WCAS”) (collectively, the “Sponsors”).

In the first phase of the purchase, which was consummated on November 8, 2002, Dex Holdings assigned to Dex Media East LLC (“Dex Media East”), another indirect wholly-owned subsidiary of Dex Media, its right to purchase the directory business of Qwest Dex in Colorado, Iowa, Minnesota, Nebraska, New Mexico, North Dakota and South Dakota. In the second phase of the purchase, which was consummated on September 9, 2003 (the “Acquisition”), Dex Holdings assigned its right to purchase the directory business of Qwest Dex in the Dex West States (“Dex West”) to the Company. Dex Holdings was dissolved effective January 1, 2005.


*(b)*	*Operations*

The Company is the largest telephone directory publisher of white and yellow pages directories to businesses and residents in the Dex West States. The Company provides directory, Internet and direct marketing solutions to local and national advertisers. Virtually all of the Company’s revenue is derived from the sale of advertising in its various directories. Published directories are distributed to residents and businesses in the Dex West States through third-party vendors. The Company operates as a single segment.


*(c)*	*Dex Media’s Initial Public Offering*

Effective July 21, 2004, Dex Media consummated its initial public offering of common stock (the “Dex Media IPO”). Immediately prior to the Dex Media IPO, Dex Media effected a 10-for-1 split of all authorized shares of common stock. On August 26, 2004, a portion of the net proceeds related to the Dex Media IPO was used to redeem $18.2 million of Dex Media West’s senior subordinated notes at a redemption price of 109.875% along with the accrued and unpaid interest. Also in connection with the Dex Media IPO, the Company paid $5.0 million to each of the Sponsors to eliminate the $2.0 million aggregate annual advisory fees payable under Dex Media West’s management consulting agreements.


2.	Basis of Presentation


*(a)*	*General*

The accompanying condensed consolidated interim financial statements are unaudited. In compliance with the instruction of the Securities and Exchange Commission (“SEC”) for interim financial statements, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted. In management’s opinion, the condensed consolidated financial statements reflect all adjustments (which consist of normal recurring adjustments) necessary to fairly present the condensed consolidated statements of

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

financial position as of June 30, 2005 and December 31, 2004, and the condensed consolidated statements of operations for the three and six months ended June 30, 2005 and 2004 and the condensed consolidated statements of cash flows for the six months ended June 30, 2005 and 2004.

These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company as of December 31, 2004 and 2003 and for the year ended December 31, 2004, for the periods from September 10 to December 31, 2003 and from January 1 to September 9, 2003, and for the year ended December 31, 2002 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004, as filed with the SEC. The condensed consolidated statements of operations for the six months ended June 30, 2005 are not necessarily indicative of the results expected for the full year.

The accompanying condensed consolidated statements of operations for the three and six months ended June 30, 2004 include all material adjustments required under purchase accounting related to the Acquisition subsequent to September 9, 2003.


*(b)*	*Reclassifications*

Certain prior period amounts have been reclassified to conform to the 2005 presentation.


3.	Summary of Significant Accounting Policies


*(a)*	*Principles of Consolidation*

The condensed consolidated financial statements of the Company include the results of operations, financial position, and cash flows of Dex Media West and its wholly-owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation.


*(b)*	*Use of Estimates*

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts and disclosures reported in these condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates.


*(c)*	*Revenue Recognition*

The sale of advertising in printed directories published by the Company is its primary source of revenue. The Company recognizes revenue ratably over the life of each directory using the deferral and amortization method of accounting, with revenue recognition commencing in the month of delivery.

The Company publishes white and yellow pages directories with primarily 12-month lives. From time to time, the Company may choose to change the publication dates of certain directories in order to more efficiently manage work and customer flow. The lives of the affected directories are expected to be 12 months thereafter. Such publication date changes do not have a significant impact on the Company’s recognized revenue as the Company’s sales contracts generally allow for the billing of additional monthly charges in the case of directories with extended lives. During the three months and six months ended June 30, 2005, the Company published 33 and 75 directories, respectively. During the three months and six months ended June 30, 2004, the Company published 28 and 69 directories, respectively.

The Company enters into transactions such as exclusivity arrangements, sponsorships, and other media access transactions, where the Company’s products and services are promoted by a third party and, in exchange, the Company carries the party’s advertisement. The Company accounts for these transactions in

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

accordance with Emerging Issues Task Force (“EITF”) Issue No. 99-17 “Accounting for Advertising Barter Transactions.” Revenue and expense related to such transactions are included in the condensed consolidated statements of operations consistent with reasonably similar items sold or purchased for cash. Such barter transactions were not significant to the Company’s financial results for the three months and six months ended June 30, 2005 and 2004.

In certain cases, the Company enters into agreements with customers that involve the delivery of more than one product or service. Revenue for such arrangements is allocated in accordance with EITF Issue No. 00-21 “Revenue Arrangements with Multiple Deliverables.”


*(d)*	*Cost of Revenue*

The Company accounts for cost of revenue under the deferral and amortization method of accounting. Accordingly, the Company’s cost of revenue recognized in a reporting period consists of: (i) costs incurred in that period and recognized in that period, principally sales salaries and wages; (ii) costs incurred in a prior period, a portion of which are amortized and recognized in the current period; and (iii) costs incurred in the current period, a portion of which are amortized and recognized in that period and the balance of which are deferred until future periods. Consequently, there will be a difference between the cost of revenue recognized in any given period and the costs incurred in the given period. Such differences may be significant.

Costs incurred in the current period and subject to deferral include direct costs associated with the publication of directories, including sales commissions, paper, printing, transportation, distribution and pre-press production and employee and systems support costs relating to each of the foregoing. Sales commissions include commissions paid to employees for sales to local advertisers and to third-party certified marketing representatives which act as the Company’s channel to national advertisers. All deferred costs related to the sales and production of directories are recognized ratably over the life of each directory under the deferral and amortization method of accounting, with cost recognition commencing in the month of delivery. From time to time the Company has changed the publication dates of certain directories. In such cases, the estimated life of the related unamortized deferred cost of revenue is revised to amortize such cost over the new remaining estimated life. Changes in directory publication dates typically do not result in any additional direct incurred costs.


*(e)*	*Stock-Based Compensation*

The Company accounts for the Stock Option Plan of Dex Media, Inc. and the Dex Media, Inc. 2004 Incentive Award Plan, as more fully discussed in Note 7, under the recognition and measurement principles of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related Interpretations. Had the Company accounted for employee stock option grants under the minimum value method for options issued prior to becoming a publicly traded company and the fair value method after becoming a publicly traded company, both of which are prescribed by Statement of Financial Accounting

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Standard (“SFAS”) No. 123, “Accounting for Stock-Based Compensation,” the pro forma results of the Company would have been as follows (in thousands):


		Three Months Ended						Six Months Ended
		June 30,						June 30,

		2005			2004			2005			2004

Net Income
	As reported	$	20,771		$	3,585		$	35,079		$	2,986
	Add: Stock-based employee compensation expense included in reported net income, net of related tax effects		160			95			314			107
	Deduct: Stock-based employee compensation expense determined under minimum value or fair value based method, as applicable, for all awards, net of related tax effects		(246	)		(164	)		(496	)		(238	)

	Pro forma	$	20,685		$	3,516		$	34,897		$	2,855


*(f)*	*Income Tax Provision*

The Company is included in the consolidated Federal income tax return and combined or consolidated state income tax returns, where permitted, for Dex Media, the Company’s indirect parent. Although the Company is a single member limited liability company and is disregarded as a taxable entity for income tax purposes, the Company calculates and records income taxes as if it filed a tax return on a stand-alone basis.

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recorded to reflect the future tax consequences of temporary differences between the financial reporting bases of assets and liabilities and their tax bases at each year end. Deferred tax assets and liabilities are measured using the enacted income tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Deferred tax assets and liabilities are adjusted for future income tax rate changes in the year the changes are enacted. Deferred tax assets are recognized for operating loss and tax credit carryforwards if management believes, based upon existing evidence, that it is more likely than not that the carryforwards will be utilized. All deferred tax assets are reviewed for realizability and valuation allowances are recorded if it is more likely than not that the deferred tax assets will not be realized. No valuation allowance has been established against deferred tax assets as of June 30, 2005 or December 31, 2004.


*(g)*	*New Accounting Standards*

On March 29, 2005, the SEC released Staff Accounting Bulletin (“SAB”) No. 107, “Share-based Payment”. SAB No. 107 provides an interpretation of SFAS No. 123R, “Share-based Payment” and its interaction with certain SEC rules and regulations and provides the SEC’s views regarding the valuation of share-based payment arrangements for public companies. SAB No. 107 provides guidance with regard to share-based payment transactions with non-employees, the transition from nonpublic to public entity status, valuation methods (including assumptions such as expected volatility and expected term), the accounting for certain redeemable financial instruments issued under share- based payment arrangements, the classification of compensation expense, non-GAAP financial measures, first-time adoption of SFAS No. 123R, the modification of employee share options prior to adoption of SFAS No. 123R and disclosures in Management’s Discussion and Analysis subsequent to the adoption of SFAS No. 123R. Based upon the options outstanding

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

as of June 30, 2005, the Company has determined that the adoption of SAB No. 107 will not have a material impact on the Company’s results of operations.

On April 14, 2005, the SEC announced the adoption of a new rule that amends the compliance dates for SFAS No. 123R. Under SFAS No. 123R, registrants would have been required to implement the standard as of the beginning of the first interim or annual period that begins after June 15, 2005. The SEC’s new rule requires companies to implement SFAS No. 123R at the beginning of their first fiscal year beginning on or after June 15, 2005, instead of the first reporting period that begins after June 15, 2005. As a result, the financial statements of the Company must comply with SFAS No. 123R beginning with the interim financial statements for the first quarter of 2006. The SEC’s new rule does not change the accounting required by SFAS No. 123R; it changes only the dates for compliance with the standard.

During May 2005, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 154, “Accounting Changes and Error Corrections — a replacement of APB Opinion No. 20 and FASB Statement No. 3.” This statement applies to all voluntary changes in accounting principle and requires retrospective application of the new accounting principle to prior accounting periods as if that principle had always been used. In addition, this statement requires that a change in depreciation method be accounted for as a change in estimate. The requirements are effective for changes made in fiscal years beginning after December 15, 2005. The Company does not expect the adoption of SFAS No. 154 to have a material impact on the Company’s financial statements.


4.	Goodwill and Intangible Assets

During the six months ended June 30, 2005 goodwill was not impaired or otherwise adjusted.

The gross carrying amount and accumulated amortization of other intangible assets and their estimated useful lives are as follows (dollars in thousands):


		As of June 30, 2005

		Gross
		Carrying		Accumulated			Net Book
Intangible Assets		Value		Amortization			Value		Life

Customer relationships — local		$	890,000	$	(295,269	)	$	594,731		20 years	⁽¹⁾
Customer relationships — national			252,000		(59,792	)		192,208		25 years	⁽¹⁾
Non-compete/publishing agreements			359,000		(16,598	)		342,402		39 years
Dex Trademark			385,000		—			385,000		Indefinite
Qwest Dex Trademark agreement			65,000		(28,048	)		36,952		4 years
Advertising agreement			26,000		(3,318	)		22,682		14 years

	Totals	$	1,977,000	$	(403,025	)	$	1,573,975


		As of December 31, 2004

		Gross
		Carrying		Accumulated			Net Book
Intangible Assets		Value		Amortization			Value		Life

Customer relationships — local		$	890,000	$	(227,181	)	$	662,819		20 years	⁽¹⁾
Customer relationships — national			252,000		(45,102	)		206,898		25 years	⁽¹⁾
Non-compete/publishing agreements			359,000		(12,019	)		346,981		39 years
Dex Trademark			385,000		—			385,000		Indefinite
Qwest Dex Trademark agreement			65,000		(20,310	)		44,690		4 years
Advertising agreement			26,000		(2,403	)		23,597		14 years

	Totals	$	1,977,000	$	(307,015	)	$	1,669,985


⁽¹⁾	Amortization expense is calculated using a declining method in relation to estimated retention lives of acquired customers.

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)


5.	Long-Term Debt

Long-term debt is comprised of the following (in thousands):


		June 30,			December 31,
		2005			2004

Notes Payable to Banks: (equal right of payment)
	Notes payable to banks, Tranche A term loan, bearing interest at adjusted London Interbank Offer Rates (“LIBOR”) plus the current applicable interest spread of 1.25% (weighted average of 4.57% at June 30, 2005)	$	391,841		$	492,848
	Notes payable to banks, Tranche B term loan, bearing interest at adjusted LIBOR plus the current applicable interest spread of 1.75% (weighted average of 4.93% at June 30, 2005)		916,933			981,152
Revolving loan bearing interest at Alternative Base Rate (“ABR”) plus the current applicable interest spread of 0.25% and at adjusted LIBOR plus the current applicable interest spread of 1.25% (weighted average interest rate of 4.75% at June 30, 2005)			43,500			—
Unsecured Notes Payable: (in descending order of right of payment; senior notes equal right of payment)
	Unsecured senior notes payable, due August 2010, bearing interest at 8.5%		385,000			385,000
	Unsecured senior notes payable, due November 2011, bearing interest at 5.875%		300,000			300,000
	Unsecured senior subordinated notes payable, due August 2013, bearing interest at 9.875%		761,800			761,800

			2,799,074			2,920,800
Less: current portion of long-term debt			(146,597	)		(84,302	)

		$	2,652,477		$	2,836,498

Dex Media West registered its 5⁷/8% senior notes with the SEC through an exchange offer completed on March 8, 2005. As of June 30, 2005, there were $43.5 million of borrowings under the revolving loan. The Company paid interest and fees on the revolving loan, interest rate swaps and outstanding notes of $93.3 million and $99.6 million during the six months ended June 30, 2005 and 2004, respectively. As of June 30, 2005 the Company was in compliance with all covenants under its credit facility.


6.	Derivative Instruments and Hedging Activities

In October 2004, the Company entered into four fixed interest rate swap agreements to hedge against the effects of increases in the interest rates associated with the floating rate debt on its term loans. The interest rate swap agreements have an aggregate notional amount of $300.0 million, applicable preset monthly fixed rates ranging from 1.901% to 3.61% and expire in October 2006. The Company has not designated these interest rate swap agreements as hedging instruments and therefore reports all gains and losses in the change in fair value directly in earnings as a component of interest expense. For the three months ended June 30, 2005, the Company recorded a loss of $1.1 million, which has been recorded as an increase to interest expense. For the six months ended June 30, 2005, the Company recorded a gain of $1.4 million, which has been recorded as a reduction to interest expense.

In May 2005 and June 2005, the Company terminated the six floating interest rate swap agreements entered into in November 2004. Under the terms of the floating interest rate swaps, the Company received fixed interest payments that match the interest obligations of the 5⁷/8% notes issued in November 2004 and made floating interest payments, thereby converting the fixed interest rate notes into floating rate debt

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

instruments. The floating interest rate swaps had an aggregate notional amount of $300.0 million, floating rate LIBOR that reset semi-annually in May and November, plus applicable margins ranging from 1.4975% to 1.57%, and were to expire in November 2011. The Company had not designated these interest rate swap agreements as hedged instruments and therefore, reported all gains and losses in the change in fair value directly in earnings as a component of interest expense. For the three months and six months ended June 30, 2005, the Company recorded net gains, as a reduction to interest expense, of $7.8 million and $2.2 million, respectively, of which $7.1 million represents the gain recognized upon termination of the swaps resulting in a cumulative net gain of $0.4 million during the life of those swaps. The Company paid $2.1 million upon termination of the swaps.


7.	Stock-Based Awards

On November 8, 2002, Dex Media adopted the Stock Option Plan of Dex Media, Inc. (the “2002 Plan”), which permits the grant of nonqualified and incentive stock options to its employees, consultants and independent directors or those of its wholly owned subsidiaries. In May 2004, Dex Media adopted the Dex Media, Inc. 2004 Incentive Award Plan (the “2004 Plan”). The 2004 Plan provides for a variety of stock-based awards, including non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, deferred stock awards, dividend equivalents, performance-base awards and other stock-based awards. Effective with the adoption of the 2004 Plan, Dex Media discontinued grants under the 2002 Plan while the options outstanding under the 2002 Plan remain outstanding pursuant to the terms of that plan. As of June 30, 2005, 6,100,386 shares of Dex Media common stock were available for grant under the 2004 Plan and 2002 Plan, with 67,500 shares of restricted stock issued pursuant to restricted stock agreements. As of December 31, 2004, the maximum number of shares of Dex Media common stock available for grant under the 2004 Plan and 2002 Plan was 6,251,650, with 25,000 shares of restricted stock issued pursuant to restricted stock agreements.

Dex Media’s Compensation Committee determines the exercise price for each option awarded. Outstanding options issued pursuant to the 2002 Plan vest in two segments. Subject to the optionee’s continued employment with the Company: (i) 25% of the options granted will vest in equal annual installments of 5% each on each December 31 beginning in the year of grant or the following year, depending upon when during the calendar year the options are granted, and ending five years after and (ii) 75% of the options granted will vest in full on the eighth anniversary of the grant date; however, an installment equal to 15% of the options granted shall become vested following each of the fiscal years beginning in the year of grant or the following year, depending upon when during the calendar year the options are granted, and ending five years after if certain earnings before interest, taxes, depreciation and amortization (“EBITDA”) targets are met with respect to each year. Options outstanding issued pursuant to the 2004 Plan vest in equal annual installments over four years.


8.	Pension and Other Post-Retirement Benefits


*(a)*	*General description*

Effective November 8, 2002, Dex Media adopted a pension plan and effective December 1, 2002, Dex Media adopted an other post-retirement benefit plan providing retiree healthcare. Dex Media has filed for a determination letter with the IRS for its pension plan. The pension plan is a noncontributory defined benefit pension plan covering substantially all management and occupational employees of the Company. The other post-retirement benefit plan provides healthcare and life insurance for certain retirees.

Pension costs and other post-retirement benefit costs are recognized over the periods in which the employee renders services and becomes eligible to receive benefits as determined by using the projected unit credit method. Dex Media’s funding policy is to make contributions with the objective of accumulating

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

sufficient assets to pay all benefits when due. No pension funding was required for Dex Media for the three months ended June 30, 2005 and 2004. The other post-retirement benefit plan is pay-as-you go and is funded out of Dex Media’s operating cash as the costs are incurred.


*(b)*	*Components of net periodic benefit cost*

The components of net periodic benefit cost for the Company are as follows (in thousands):


	Three Months Ended June 30,

	2005						2004

	Pension			Post-Retirement			Pension			Post-Retirement
	Benefit			Benefits			Benefit			Benefits

Service cost	$	1,281		$	285		$	1,471		$	343
Interest cost		1,722			562			1,713			414
Expected return on plan assets		(2,195	)		—			(2,184	)		—
Amortization of prior service costs		(54	)		(51	)		—			(57	)
Amortization of net (gain) loss		—			18			—			—

Total net periodic benefit cost	$	754		$	814		$	1,000		$	700


	Six Months Ended June 30,

	2005						2004

	Pension			Post-Retirement			Pension			Post-Retirement
	Benefit			Benefits			Benefit			Benefits

Service cost	$	2,837		$	656		$	2,942		$	686
Interest cost		3,435			1,033			3,426			828
Expected return on plan assets		(4,322	)		—			(4,368	)		—
Amortization of prior service costs		(54	)		(108	)		—			(114	)
Amortization of net (gain) loss		—			18			—			—

Total net periodic benefit cost	$	1,896		$	1,599		$	2,000		$	1,400

Dex Media does not expect to make any contributions to its pension plan in 2005.

As a result of employee terminations, Dex Media expects that lump sum settlement payments of pension liabilities will exceed pension service and interest costs during the three months ended September 30, 2005. Dex Media expects to record a settlement as defined in SFAS No. 88, “Employers’ Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits.” The result of this settlement accounting will be to record a portion of the company’s unrecognized actuarial gain or loss to income. The Company can not estimate that gain or loss at this time.

In December 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (“Medicare Act”) was signed into law. The Medicare Act provides for a federal subsidy to be paid to employers beginning in 2006 if an employer provides alternative prescription drug coverage for Medicare eligible retirees where that alternative coverage is at least actuarially equivalent to the standard coverage provided under the Medicare Act. Final regulations regarding the calculation of actuarial equivalence were issued on January 21, 2005 and it was subsequently determined that the plan’s prescription drug benefit for certain occupational (union) employees is projected to satisfy the requirements to receive the federal subsidy for approximately eight years beginning in 2006. The expected savings was not included in the 2004 financial results, but is expected to be reflected in the net periodic benefit cost for 2005 and later years.

DEX MEDIA WEST LLC

AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF DEX MEDIA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In accordance with FASB Staff Position No. 106-2, “Accounting for Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003,” the reduction in plan liability was recognized as an actuarial gain as of January 1, 2005. This reduced the plan’s liability by approximately $0.1 million as of January 1, 2005. The impact of the subsidy on the total 2005 net periodic benefit cost was immaterial. In addition, the amount of federal subsidies projected to be received by us for the periods 2006 through 2013 are also expected to be immaterial.


9.	Commitments and Contingencies

The Company is involved, from time to time, in litigation arising in the normal course of business. The outcome of this litigation is not expected to have a material adverse impact on the Company.


10.	Related Party Transactions

Upon consummation of the Acquisition, all Dex West employees became employees of Dex Media East. Effective January 1, 2004, all employees of Dex Media East were transferred to Dex Media Service LLC (“Service Co.”). Effective January 1, 2005, all non-senior management employees in the state of Washington became employees of Dex Media West. As such, as of June 30, 2005, all employee-related liabilities, including pension and other post-retirement obligations, related to non-senior management employees in the state of Washington are included in the Company’s liabilities. All employee-related liabilities for Service Co.’s employees are included in Service Co.’s liabilities, with an offsetting asset recorded as an affiliate receivable for the portion of the liability associated with employees providing services to Dex Media West and Dex Media East. Under the Shared Services and Employees Agreement dated September 9, 2003, costs related to Service Co. employees providing services entirely for Dex Media West are allocated 100% to Dex Media West. Shared employee costs are allocated and charged to Dex Media West based upon Dex Media West’s proportional share of consolidated Dex Media revenue. All cash related affiliate balances are settled at least monthly.

In connection with the Acquisition, the Company entered into management consulting agreements with each of the Sponsors. Each agreement allows the Company access to the Sponsors’ expertise in areas such as corporate management, financial transactions, product strategy, investment, acquisitions and other matters that relate to the Company’s business, administration and policies. Each of the Sponsors received a one-time transaction fee for structuring the transactions related to the Acquisition of $20.1 million. In addition, each of the Sponsors received an annual advisory fee of $1.0 million for advisory, consulting and other services. The annual advisory fees payable under the agreements were terminated for a one-time fee of $5.0 million paid to each of the Sponsors, for an aggregate of $10.0 million, in conjunction with the Dex Media IPO. The Sponsors maintain the right to act as Dex Media’s financial advisor or investment banker in conjunction with any merger, acquisition, disposition, financing or similar transaction in return for additional reasonable compensation and expenses as may be agreed upon by the parties. Pursuant to these management consulting agreements, the Company incurred $1.0 million in advisory fees for the six months ended June 30, 2004.

During February 2003, Dex Media entered into a five year agreement with Amdocs, Inc. (“Amdocs”) for the complete modernization of the Company’s core production platform. This project was designed to upgrade the Company’s existing software system to enhance its functionality. WCAS, one of the Sponsors, was a shareholder of Amdocs at the time the Company entered into the agreement and ceased to be a shareholder of Amdocs during 2004. For the six months ended June 30, 2005 and 2004, the Company paid Amdocs $17.8 million and $30.5 million, respectively, under this agreement and for other related on-going support.


Item 2.	*Management’s Narrative Analysis of Results of Operations*

Pursuant to General Instructions H(2)(a) of Form 10-Q: (i) the information called for by Item 2 of Part I, Management’s Discussion and Analysis of Financial Condition and Results of Operations, has been omitted and (ii) the registrant is providing a management’s narrative analysis of results of operations.

Executive Overview


	*Our Company*

In the following discussion and analysis, “we,” “our” or “us” refers to Dex Media West.

We are the exclusive publisher of the “official” yellow pages and white pages directories for Qwest in the following states where Qwest is the primary incumbent local exchange carrier: Arizona, Idaho, Montana, Oregon, Utah, Washington and Wyoming. We have been publishing directories for over 100 years. Our contractual agreements with Qwest grant us the right to be the exclusive incumbent publisher of the “official” yellow pages and white pages directories for Qwest in the Dex West States until November 2052 and prevent Qwest from competing with us in the directory products business in the Dex West States until November 2042.

We are the largest directory publisher in the Dex West States and, collectively with Dex Media East, are the fourth largest directory publisher in the U.S. During the six months ended June 30, 2005 and 2004, we published 75 and 69 directories, respectively, and printed approximately 17.5 million and 15.5 million copies, respectively, of these directories for distribution to virtually all business and residential consumers throughout the Dex West States. In addition, our Internet-based directory, DexOnline.com^tm, which is bundled with our print product to provide web-based access to our directories, further extends the distribution of our advertisers’ content. DexOnline.com includes approximately 21 million business listings and 129 million residential listings from across the United States. Our other products and services include the sale of direct marketing lists and the sale of Dex directories and other publishers’ directories outside the normal delivery schedule.

We seek to bring buyers together with our advertising customers through a cost-effective, bundled advertising solution that includes print, Internet-based and CD-ROM directories. The majority of our advertising customers are small and medium-sized local businesses and national businesses with a local presence. We believe that our advertising customers value: (i) our ability to provide consumers with an authoritative and diverse reference source to search for products and services across multiple platforms; (ii) our broad distribution to potential buyers of our advertisers’ products and services; (iii) our lower cost per usage compared with most other directories and a higher return on investment than other forms of local advertising; and (iv) the quality of our client service and support.

For the six months ended June 30, 2005, we generated approximately 98% of our total revenue from the sale of bundled print and Internet directory advertising. Our other products and services account for the remaining 2% of our total revenue. For the six months ended June 30, 2005 and 2004, we generated $465.8 million and $424.3 million in total revenue, respectively. Excluding the effects of purchase accounting adjustments to deferred revenue, our total revenue for the six months ended June, 2004 would have been $462.4 million. See “Results of Operations” in this Item 2.


	*Background*

The following discussion and analysis of our financial condition and results of operations covers periods subsequent to the consummation of the Acquisition on September 9, 2003.

The Acquisition was accounted for under the purchase method of accounting. Under this method, the pre-acquisition deferred revenue and related deferred costs associated with directories that were published prior to the Acquisition were not carried over to our balance sheet. The effect of this accounting treatment was to reduce revenue and related costs that would otherwise have been recognized during the twelve months subsequent to the acquisition date.

The non-historical statements in this Item 2, including statements regarding industry outlook and our expectations regarding the future performance of our business, are forward-looking statements. Such forward-looking statements are subject to numerous risks and uncertainties, and our results may differ materially from those contained in any such forward-looking statements. See “Disclosure Regarding Forward-Looking Statements” in this Item 2.

Results of Operations


	*Overview*

Our consolidated financial statements included in this quarterly report have been prepared on the basis of the deferral and amortization method of accounting, under which revenue and cost of revenue related to the publication of directories are initially deferred and then recognized ratably over the life of each directory, commencing in the month of delivery. From time to time, we have determined that the publication dates of certain directories will be extended. These publication date changes are made to more efficiently manage work and customer flow. The lives of the affected directories are expected to be 12 months following the new publication date. Generally, we are able to bill and collect for additional periods related to directory extensions and under the deferral and amortization method of accounting, our related cost of revenue is amortized over the extended estimated useful life of the directory. Certain prior period amounts have been reclassified to conform to the 2005 presentation.


	*Revenue*

We derive virtually all our revenue from the sale of advertising in our printed directories, which we refer to as directory services revenue. The sale of advertising in our printed directories also includes the replication of listings and display advertisements in DexOnline.com, our Internet-based directory. We also provide related services, including other Internet-related products, direct marketing lists and the sale of Dex directories and other publishers’ directories outside of the normal delivery schedule, which we refer to collectively as other revenue. Directory services revenue is affected by several factors, including changes in the quantity and size of advertisements sold, defectors and new advertisers, as well as the proportion of premium advertisements sold, changes in the pricing of advertising, changes in the quantity and mix of advertising purchased per account and the introduction of additional products which generate incremental revenue. Directory services revenue may also increase through the publication of new printed directories. Revenue recognized on sales under our Advertising Commitment Agreement with Qwest consists primarily of directory services revenue.

Our revenue and cost of revenue for the twelve months following the consummation of the Acquisition were lower than they otherwise would have been because the Acquisition was accounted for under the purchase method of accounting. Under the purchase method of accounting, deferred revenue and deferred directory costs associated with the directories published and distributed prior to the Acquisition were not carried over to our balance sheet at the time of purchase. The effect of this accounting treatment was to reduce revenue and related costs that would otherwise be recognized in the twelve months subsequent to the Acquisition. The purchase method of accounting did not affect our revenue and directory costs in periods subsequent to September 30, 2004. These purchase accounting adjustments are non-recurring and have no impact on cash flows.

We enter into transactions such as exclusivity arrangements, sponsorships and other media access transactions whereby our products and services are promoted by a third party and, in exchange, we carry that party’s advertisement. We account for these transactions in accordance with EITF Issue No. 99-17. Revenue and expense related to such transactions are included in the condensed consolidated statements of operations consistent with reasonably similar items sold or purchased for cash. These related revenue items are currently included in local directory services revenue. The revenue from such transactions for the six months ended June 30, 2005 and 2004 represented less than 1% of total revenue in each period and is expected to continue at this level for the foreseeable future. The revenue and related expense have no impact on net income or cash flow over the life of the bartered advertisement.

In certain cases, we enter into agreements with accounts that involve the delivery of more than one product or service. We allocate revenue for such arrangements in accordance with EITF Issue No. 00-21.


	*Cost of Revenue*

We account for cost of revenue under the deferral and amortization method of accounting. Accordingly, our cost of revenue recognized in a reporting period consists of: (i) costs incurred in that period and recognized in that period, principally sales salaries and wages; (ii) costs incurred in a prior period, a portion of which are amortized and recognized in the current period; and (iii) costs incurred in the current period, a portion of which are amortized and recognized in that period and the balance of which are deferred until future periods. Consequently, there will be a difference between the cost of revenue recognized in any given period and the costs incurred in that period. Such differences may be significant.


	*General and Administrative Expense*

Our general and administrative expense consists primarily of the costs of advertising, promotion and marketing, administrative staff, pension and other post-retirement benefits, information technology, training, account billing, corporate management, office and facilities expense and bad debt expense. All our general and administrative expense is recognized in the period in which it is incurred.


	*Income Tax Provision*

We account for income taxes under the asset and liability method of accounting. Deferred tax assets and liabilities are recorded to reflect the future tax consequences of temporary differences between the financial reporting bases of assets and liabilities and their tax bases at each year end. Deferred tax assets and liabilities are measured using the enacted income tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Deferred tax assets and liabilities are adjusted for future income tax rate changes in the year the changes are enacted. Deferred tax assets are recognized for operating loss and tax credit carry forwards if management believes, based upon existing evidence, that it is more likely than not that the carry forward will be utilized. All deferred tax assets are reviewed for realizability, and valuation allowances are recorded if it is more likely than not that the deferred tax assets will not be realized.

Items Affecting Comparability Between Periods

Our revenue and cost of revenue for the twelve months following the consummation of the Acquisition on September 9, 2003 were $120.6 million and $31.6 million lower, respectively, than our revenue and cost of revenue would have been otherwise because the Acquisition was accounted for under the purchase method of accounting. For the six months ended June 30, 2004, our revenue and cost of revenue were $38.1 million and $9.7 million lower, respectively, than they would have been due to the effects of purchase accounting. Under the purchase method of accounting, deferred revenue and related deferred directory costs associated with directories that had previously been published and distributed were not carried over to our balance sheet. The effect of this accounting treatment is to reduce revenue and related costs that would otherwise have been recognized in the twelve months subsequent to the Acquisition. These purchase accounting adjustments are non-recurring and have no historical or future cash impact. The purchase method of accounting will not affect our revenue or directory costs subsequent to September 30, 2004.

Prior to the Dex Media IPO, we paid an annual management fee of $2.0 million to the Sponsors. In connection with the Dex Media IPO, we made a lump sum payment of $10.0 million in aggregate to the

Sponsors to terminate our obligation to pay such annual advisory fees. For the six months ended June 30, 2004, the Company incurred $1.0 million of annual management fees.


	*The Six Months Ended June 30, 2005 Compared to the Six Months Ended June 30, 2004*

The results of operations for the six months ended June 30, 2004 include the effect of purchase accounting on revenue and cost of revenue related to the Acquisition. Accordingly, the periods presented are not comparable. Please refer to “Items Affecting Comparability Between Periods” in this Item 2 and the discussion below for detail regarding the effects of these adjustments.


			Six Months Ended
			June 30,

			2005			2004

			(Dollars in thousands)
Revenue:
	Local directory services		$	386,125		$	378,757
	National directory services			64,693			31,416
	Qwest advertising			3,848			4,304
	Other revenue			11,146			9,806

		Total revenue		465,812			424,283
Cost of revenue				140,529			129,734

	Gross profit, excluding depreciation and amortization expense		$	325,283		$	294,549
	Gross margin			69.8	%		69.4	%
General and administrative expense, including bad debt expense			$	60,625		$	58,285


	*Revenue*

Total revenue increased $41.5 million, or 9.8%, to $465.8 million for the six months ended June 30, 2005 from $424.3 million for the six months ended June 30, 2004. Total revenue for the six months ended June, 2004 was $38.1 million lower than it would have been due to the effects of purchase accounting. Excluding the effects of purchase accounting in 2004, total revenue would have increased $3.4 million, or 0.7%, for the six months ended June 30, 2005. The increase in total revenue, excluding the effects of purchase accounting, was primarily due to an increase in local and national directory services revenue and an increase in other revenue relating to our Internet product line, and was partially offset by a decrease in Qwest advertising revenue.

Local and national directory services revenue is affected by a variety of volume and pricing factors. Volume related factors include quantity of advertisements sold, the change in mix of advertisements among our product families, the proportion of advertisements sold with premium features, the volume of promotional services obtained from our advertisers in exchange for our publication of their advertisements in our directories, the number of local advertisers’ disconnects and the number of new advertisers obtained during a period. Pricing factors include price increases related to our standard rates that may be made from time to time in varying markets for varying categories, and are offset by discount programs that may be initiated in local markets for certain advertiser headings. Such factors generally affect the dollar volume of orders initiated in a period which are recognized as revenue over the life of a given directory, beginning in the month of delivery. Fluctuations in product mix and pricing are among the multiple factors that contributed to the change in local and national directory services revenue.

Local directory services revenue increased $7.4 million, or 1.9%, to $386.1 million for the six months ended June 30, 2005 compared to $378.8 million for the six months ended June 30, 2004. Local directory service revenue for the six months ended June 30, 2004 was $5.9 million lower than it would have been due to the effects of purchase accounting. Excluding the effects of purchase accounting in 2004, local directory services revenue increased $1.4 million, or 0.4%, for the six months ended June 30, 2005. Local directory services revenue, excluding the effects of purchase accounting in 2004, accounted for 82.9% and 83.2% of revenue for the six months ended June 30, 2005 and 2004, respectively.

Revenue from national advertisers increased $33.3 million to $64.7 million for the six months ended June 30, 2005 compared to $31.4 million for the six months ended June 30, 2004. Revenue from national advertisers for the six months ended June 30, 2004 was $32.2 million lower than it would have been due to the effects of purchase accounting. Excluding the effects of purchase accounting in 2004, revenue from national advertisers increased $1.1 million, or 1.7%, for the six months ended June 30, 2005. Revenue from national advertisers, excluding the effects of purchase accounting in 2004, accounted for 13.9% and 13.8% of revenue for the six months ended June 30, 2005 and 2004, respectively.

Revenue from Qwest advertising decreased $0.5 million, or 10.6% to $3.8 million for the six months ended June 30, 2005 from $4.3 million for the six months ended June 30, 2004. This decrease in Qwest advertising revenue was a result of the timing of Qwest’s purchases under its Advertising Commitment Agreement with us. Under the Advertising Commitment Agreement, Qwest is obligated to purchase $20.0 million collectively in advertising annually from us and Dex Media East. However, if in any given year Qwest exceeds the $20.0 million of advertising purchases, up to $5.0 million of the excess will be credited to the following year’s purchase commitment. As a result of purchases in excess of the $20.0 million for the year ended December 31, 2003, Qwest purchased less than $20.0 million of Dex advertising in 2004, of which a portion is deferred and recognized over the life of the related directory in 2005.

Other revenue increased by $1.3 million, or 13.7%, to $11.1 million for the six months ended June 30, 2005 from $9.8 million for the six months ended June 30, 2004. This increase in other revenue was related primarily due to an increase in Internet revenue, and was partially offset by a decrease in direct marketing revenue.


	*Cost of revenue*

Cost of revenue recognized was $140.5 million for the six months ended June 30, 2005 compared to $129.7 million for the six months ended June 30, 2004. Cost of revenue recognized for the six months ended June 30, 2004 was $9.7 million lower than it would have been due to the effects of purchase accounting. Cost of revenue recognized, excluding the effects of purchase accounting in 2004, represented 30.2% and 30.1% of revenue for the six months ended June 30, 2005 and 2004, respectively. The cost of revenue recognized does not include any depreciation and amortization expense.

For the six months ended June 30, 2005 and 2004, we incurred costs subject to deferral and amortization of $146.9 million and $147.0 million, respectively.

Employee costs incurred decreased by $3.0 million, or 4.9%, to $57.7 million for the six months ended June 30, 2005 from $60.7 million for the six months ended June 30, 2004. This decrease primarily resulted from a reduction in the number of employees, which related primarily to planned workforce reductions.

Direct publishing costs incurred, which primarily include paper, printing and distribution, increased $0.2 million, or 0.4%, to $56.0 million for the six months ended June 30, 2005 from $55.8 million for the six months ended June 30, 2004. The increase primarily was a result of the introduction of new directories, and was partially offset by a decrease in printing costs due to the implementation of a new printing agreement with one of the two outside providers of printing services.

Contracting and professional fees incurred increased $4.5 million, or 72.6%, to $10.7 million for the six months ended June 30, 2005 from $6.2 million for the six months ended June 30, 2004. This increase was primarily due to costs related to supporting our new production system, which we began to incur in the second quarter of 2004.

National commissions was $15.5 million for the six months ended June 30, 2005 and for the same period in 2004.

Other cost of revenue incurred, which primarily includes systems expense, and office and facilities expense, was $7.0 million for the six months ended June 30, 2005 compared to $8.8 million for the six months ended June 30, 2004.


	*Gross profit*

Our gross profit was $325.3 million for the six months ended June 30, 2005 compared to $294.5 million for the six months ended June 30, 2004. Excluding the effects of purchase accounting in 2004, gross profit for the six months ended June 30, 2004 would have been $322.9 million. Gross margin, excluding the effects of purchase accounting in 2004, was 69.8% and 69.9% for the six months ended June 30, 2005 and 2004, respectively.


	*General and administrative expense*

General and administrative expense, including bad debt expense, increased $2.3 million or 3.9%, to $60.6 million for the six months ended June 30, 2005 from $58.3 million for the six months ended June 30, 2004. The increase was primarily due to increases in employee costs and in contracting and professional fees offset by decreases in advertising expense and bad debt expense.

Employee costs increased $3.0 million, or 18.2%, to $19.5 million for the six months ended June 30, 2005 compared to $16.5 million for the six months ended June 30, 2004. Employee costs include salaries and wages, benefits and other employee costs. Salaries and wages were $10.6 million for the six months ended June 30, 2005 compared to $10.4 million for the six months ended June 30, 2004. Benefits increased $0.3 million, or 5.8%, to $5.5 million for the six months ended June, 2005 from $5.2 million for the six months ended June 30, 2004. Other employee costs increased $2.5 million for the six months ended June 30, 2005 to $3.4 million from $0.9 million for the six months ended June 30, 2004. This increase was primarily related to recognition of net accrued severance costs of $2.2 million in connection with planned workforce reductions during the three months ended June 30, 2005.

Advertising expense decreased $0.2 million, or 2.3%, to $8.6 million for the six months ended June 30, 2005 from $8.8 million for the six months ended June 30, 2004. Advertising expense as a percentage of revenue, excluding the effects of purchase accounting in 2004, decreased to 1.8% for the six months ended June 30, 2005 from 1.9% for the six months ended June 30, 2004.

Contracting and professional fees increased $0.7 million, or 6.7%, to $11.2 million for the six months ended June 30, 2005 from $10.5 million for the six months ended June 30, 2004. For the six months ended June 30, 2004, contracting and professional fees included $1.0 million of annual advisory fees paid to our Sponsors. This fee was terminated in conjunction with the Dex Media IPO and therefore was not incurred in the six months ended June 30, 2005. The decrease in such advisory fees was offset by an increase in on-going support costs related to our new production system, which we began incurring in the second quarter of 2004.

Bad debt expense decreased $0.9 million, or 7.4%, to $11.0 million for the six months ended June 30, 2005 from $11.8 million for the six months ended June 30, 2004. Bad debt expense as a percentage of total revenue, excluding the effects of purchase accounting in 2004, was 2.4% for the six months ended June 30, 2005 and 2.6% for the six months ended June 30, 2004.

All other general and administrative expense was $10.3 million and $10.7 million for the six months ended June 30, 2005 and 2004, respectively.


	*Amortization of intangibles*

For the six months ended June 30, 2005 and 2004 we recognized $96.0 million and $115.7 million, respectively, in amortization expense related to our identifiable intangible assets. The decrease in amortization expense from the prior year was the result of a declining method used to amortize the value of the acquired customer accounts in proportion with their estimated retention lives.


	*Interest expense*

Interest expense was $104.4 million and $107.9 million for the six months ended June 30, 2005 and 2004, respectively. Interest expense for the six months ended June, 2005 and 2004 includes $10.7 million and $13.1 million, respectively, of amortization of deferred financing costs.


	*Income taxes*

SFAS No. 109 requires that we recognize deferred income tax assets on net operating losses to the extent realization of these assets is more likely than not. As of June 30, 2005 we have recorded $6.8 million of net deferred income tax liabilities. Included in the net deferred tax liability is a deferred tax asset of $34.0 million relating to estimated net operating loss carryforwards of $87.1 million. As of December 31, 2004 we recorded $15.7 million of net deferred income tax assets, of which $42.5 million resulted from estimated net operating loss carryforwards of $110.6 million, pending the filing of the 2004 income tax return. Net operating loss carryforwards do not begin to expire until 2023. Based upon current projections of income and expenses, we have determined that it is more likely than not that we will utilize these deferred tax assets before the expiration of the net operating loss carryforward periods. Accordingly, no valuation allowance has been recorded.

Material Trends, Known Facts and Uncertainties


	*Directory Services Revenue*

For the six months ended June 30, 2005, approximately 98% of our revenue came from directory services, our bundled advertising solution that includes print, Internet-based directories and CD-ROMs. Our ability to increase directory services revenue is dependent on our ability to attract and retain advertisers or increase revenue per advertiser account through a change in advertising volume and/or rates.

While we do not believe there has been any material change in our advertiser account renewal rate, we were unable to report our renewal rate in 2004 or to date in 2005 due to our conversion to the Amdocs software system. The Amdocs conversion has resulted in certain of our customer account categories being reclassified, which may result in a change in how we report our total number of customer accounts, thereby having an effect on our reported renewal rate. Further, we believe that our revenue per advertiser account has likely increased primarily as a result of the inherent value in our products resulting in a continued ability to increase prices.


	*Segmented Pricing*

We are continuing to implement a more sophisticated segmented pricing strategy, which prices advertisements by heading category. We believe that implementing this strategy will improve advertiser retention ultimately improving revenue growth as we better align our pricing with our customers’ perception of value.


	*Competition*

The U.S. directory advertising industry continues to be very competitive. There are a number of independent directory publishers and publishers affiliated with local exchange carriers with which we compete in one or more of the Dex West States. On average, there are two to three competing directories (including Dex) in each of our local markets. Competition from other yellow pages publishers affects our ability to attract and retain advertisers and to increase advertising rates.

Through our Internet-based directory, DexOnline.com, we compete with these publishers and with other Internet sites providing search and classified directory information. In addition, we compete against other forms of media, including newspapers, radio, television, the Internet, billboards and direct mail for business advertising.


	*Internet*

We believe that our Internet-based directory, DexOnline.com, is an extension of our printed directories. We believe that any decline in the usage of our printed directories could be offset by an increase in usage of our Internet-based directory, DexOnline.com, which was the number one rated Internet Yellow Pages local search site during 2004 and in the first quarter of 2005 in the Dex States as reported by comScore. Additionally, the full roll-out of our Search Engine Marketing (“SEM”) product, Dex Web Clicks^tm, will

serve to provide our advertisers with a simplified solution to their participation in the complex area of auction-based internet advertising and could provide us with incremental revenue growth. However, if we are unsuccessful in monetizing increased usage from our Internet-based directory or are not able to effectively deliver our SEM product, our business could be negatively impacted.


	*Paper Prices*

Paper is our principal raw material. Substantially all of the paper that we use (other than for covers) is supplied by two companies: Nippon Paper Industries USA, Co., Ltd. and Norske Skog Canada (USA), Inc. Prices under the two agreements are negotiated each year based on prevailing market rates, which have been declining consistent with general U.S. market trends for directory paper over the last three years. After recent favorable trends, beginning in the second half of 2004, pulp prices have been increasing at rates higher than the general inflation rate. This has resulted in upward pressure on our paper prices. The effect of such upward price pressure, however, will be moderated due to the fact that prices under both our paper agreements are subject to certain price escalation limits.


	*New Accounting Standards*

On March 29, 2005, the SEC released SAB No. 107, which provides an interpretation of SFAS No. 123R and its interaction with certain SEC rules and regulations and provides the SEC’s views regarding the valuation of share-based payment arrangements for public companies. SAB No. 107 provides guidance with regard to share-based payment transactions with non-employees, the transition from nonpublic to public entity status, valuation methods (including assumptions such as expected volatility and expected term), the accounting for certain redeemable financial instruments issued under share-based payment arrangements, the classification of compensation expense, non-GAAP financial measures, first-time adoption of SFAS No. 123R, the modification of employee share options prior to adoptions of SFAS No. 123R and disclosures in Management’s Discussion and Analysis subsequent to the adoption of SFAS No. 123R. Based upon the number of stock options outstanding as of June 30, 2005, the Company has determined that the adoption of SAB No. 107 will not have a material impact on its results of operations.

During May 2005, the FASB issued SFAS No. 154. This statement applies to all voluntary changes in accounting principle and requires retrospective application of the new accounting principle to prior accounting periods as if that principle has always been used. In addition, this statement requires that a change in depreciation method be accounted for as a change in estimate. The requirements are effective for changes made in fiscal years beginning after December 15, 2005. The Company does not expect the adoption of SFAS No. 154 to have a material impact on the Company’s financial statements.

Cautionary Note Regarding Forward-Looking Statements

This quarterly report contains “forward-looking statements,” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Such risks and uncertainties are described in detail in our Annual Report on Form 10-K for the year ended December 31, 2004 and include,

but are not limited to: (i) our substantial indebtedness, which could impair our ability to operate our business; (ii) the terms of our subsidiaries’ credit facilities and indentures, which may restrict our access to cash flow and our ability to pursue our business strategies; (iii) increased competitive pressure from other directory publishers or media companies; (iv) the loss of any of our key agreements with Qwest; (v) declining usage of printed yellow page directories; (vi) our inability to renew customer advertising contracts; (vii) risks related to the start-up of new print or Internet directories and media services; (viii) our practice of extending credit to small and medium-sized businesses; (ix) our dependence on third-party providers of printing, distribution and delivery services; (x) the impact of fluctuations in the price or availability of paper; (xi) our failure to successfully convert to the Amdocs software system; (xii) the impact of turnover among sales representatives or the loss of key personnel; (xiii) the occurrence of work stoppages; and (xiv) general economic, market or business conditions. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue,” “assumption” or the negative of these terms or other comparable terminology. These statements are only predictions.

In particular, forward-looking statements include, but are not limited to, statements made under the heading “Management’s Narrative Analysis of Results of Operations” relating to our strategies, revenue and cost trends, gross margins, cost savings benefits, industry and competitive forces, our segmented pricing strategy, usage of DexOnline.com and Dex Web Clicks and the impact on the Company of recent accounting pronouncements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. These forward-looking statements are made as of the date of this quarterly report and, except as required under the federal securities laws and the rules and regulations of the SEC, we assume no obligation to update or revise them or to provide reasons why actual results may differ.

We do not undertake any responsibility to release publicly any revisions to these forward-looking statements to take into account events or circumstances that occur after the date of this quarterly report. Additionally, we do not undertake any responsibility to update you on the occurrence of any unanticipated events which may cause actual results to differ from those expressed or implied by the forward-looking statements contained in this quarterly report.


Item 3.	*Quantitative and Qualitative Disclosures About Market Risk*

Omitted pursuant to General Instructions H(2)(c) of Form 10-Q.


Item 4.	*Controls and Procedures*

Dex Media West maintains disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Exchange Act) that are designed to ensure that information that would be required to be disclosed in Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to Dex Media West’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of the end of the period covered by this report, Dex Media West carried out an evaluation, under the supervision and with the participation of Dex Media West’s management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of Dex Media West’s disclosure controls and procedures. Based on the foregoing, Dex Media West’s Chief Executive Officer and Chief Financial Officer concluded that Dex Media West’s disclosure controls and procedures were effective as of the end of the period covered by this report.

During the three months ended June 30, 2005, there was no change in Dex Media West’s internal controls or in other factors that has materially affected, or is reasonably likely to materially affect, Dex Media West’s internal controls over financial reporting.

PART II.

OTHER INFORMATION


Item 1.	*Legal Proceedings*

From time to time, we are a party to litigation matters arising in connection with the normal course of our business. In many of these matters, plaintiffs allege that they have suffered damages from errors or omissions or improper listings contained in directories published by us. Although we have not had notice of any such claims that we believe to be material, any pending or future claim could have a material adverse effect on our business.

In addition, we are exposed to defamation and breach of privacy claims arising from our publication of directories and our methods of collecting, processing and using personal data. The subjects of our data and users of data that we collect and publish could have claims against us if such data were found to be inaccurate, or if personal data stored by us were improperly accessed and disseminated by unauthorized persons. Although to date we have not had notice of any material claims relating to defamation or breach of privacy claims, we may be party to litigation matters that could have a material adverse effect on our business.


Item 2.	*Unregistered Sales of Equity Securities and Use of Proceeds*

Omitted pursuant to General Instructions H(2)(b) of Form 10-Q.


Item 3.	*Defaults Upon Senior Securities*

Omitted pursuant to General Instructions H(2)(b) of Form 10-Q.


Item 4.	*Submission of Matters to a Vote of Security Holders*

Omitted pursuant to General Instructions H(2)(b) of Form 10-Q.


Item 5.	*Other Information*

On June 16, 2005, Dex Media West amended its Credit Agreement, as amended and restated, to, among other things: (i) permit Dex Media West to engage in accounts receivable securitization transactions not exceeding $232.0 million in the aggregate at any time; (ii) increase the restricted payment basket for cash dividends by the Company from $40.6 million to $58.0 million annually; and (iii) reduce the applicable margins for Tranche A term loans and revolving loans made under such Credit Agreement.


Item 6.	*Exhibits*


Exhibits		Description

	Exhibit 10.1	Dex Media, Inc. Deferred Compensation Plan (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.2	Dex Media, Inc. Corporate Aircraft Policy (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.3	Dex Media, Inc. Financial Planning Benefit (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.4	Dex Media, Inc. 2005 Bonus Plan Targets (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.5	Fourth Amendment, dated as of June 16, 2005, to the Credit Agreement, dated as of September 9, 2003, as amended and restated as of July 27, 2004, by and among Dex Media, Inc., Dex Media West, Inc., Dex Media West LLC, JPMorgan Chase Bank, N.A. as administrative agent, J.P. Morgan Securities Inc. and Banc of America Securities LLC, as joint bookrunners and co-lead arrangers, and Bank of America, N.A., Wachovia Bank, National Association, Lehman Commercial Paper Inc. and Deutsche Bank Trust Company Americas, as co-syndication agents.


Exhibits		Description


	Exhibit 31.1	Certification of Chief Executive Officer of Dex Media West LLC pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

	Exhibit 31.2	Certification of Chief Financial Officer of Dex Media West LLC pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

SIGNATURE

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 by the undersigned, thereunto duly authorized.


	DEX MEDIA WEST LLC


	By:	/s/ ROBERT M. NEUMEISTER, JR.



	Robert M. Neumeister, Jr.
	Executive Vice President and Chief Financial Officer
	(Principal Financial Officer and Duly Authorized Officer)

Date: August 8, 2005

EXHIBIT INDEX


Exhibits		Description

	Exhibit 10.1	Dex Media, Inc. Deferred Compensation Plan (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.2	Dex Media, Inc. Corporate Aircraft Policy (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.3	Dex Media, Inc. Financial Planning Benefit (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.4	Dex Media, Inc. 2005 Bonus Plan Targets (incorporated by reference to Dex Media, Inc.’s Current Report on Form 8-K dated May 17, 2005).

	Exhibit 10.5	Fourth Amendment, dated as of June 16, 2005, to the Credit Agreement, dated as of September 9, 2003, as amended and restated as of July 27, 2004, by and among Dex Media, Inc., Dex Media West, Inc., Dex Media West LLC, JPMorgan Chase Bank, N.A. as administrative agent, J.P. Morgan Securities Inc. and Banc of America Securities LLC, as joint bookrunners and co-lead arrangers, and Bank of America, N.A., Wachovia Bank, National Association, Lehman Commercial Paper Inc. and Deutsche Bank Trust Company Americas, as co-syndication agents.

	Exhibit 31.1	Certification of Chief Executive Officer of Dex Media West LLC pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

	Exhibit 31.2	Certification of Chief Financial Officer of Dex Media West LLC pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

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DEX MEDIA WEST LLC 10-Q