Tribune Media Company Reports Second Quarter 2015 Results

CONTINUED PROGRESS AGAINST STRATEGIC OBJECTIVES

Aug 13, 2015, 07:15 ET from Tribune Media Company

NEW YORK, Aug. 13, 2015 /PRNewswire/ -- Tribune Media Company (the "Company") (NYSE: TRCO) today reported its results for the three months and six months ended June 30, 2015.

Second Quarter Financial Highlights (each as compared to the three months ended June 29, 2014)

  • Consolidated operating revenue grew 6% to $501.5 million.
  • Television and Entertainment segment revenue grew 4%, driven by higher advertising revenues and increased carriage and retransmission fees.
  • Consolidated operating profit decreased 39% to $19.8 million.
  • Consolidated Adjusted EBITDA decreased 29%, in large part driven by three factors:
    • Previously announced change in the timing of the amortization of programming expense for original programming at WGN America,
    • Planned production funding for co-owned original programming for WGN America, and
    • Implementation costs for improved technology applications and the establishment of new shared services operations.
  • Basic and diluted loss per share from continuing operations of $(0.04), which includes a pre-tax charge of $37 million for loss on the extinguishment of debt related to the Company's refinancing of its Term Loan Facility and issuance of $1.1 billion of 5.875% Senior Notes due in 2022.

Strategic Highlights

  • WGN America
    • Conversion of WGN America from a superstation to a basic cable network is ahead of schedule, with an expectation of at least 75% of subscribers converted by the end of 2015.
    • 48% increase in carriage fees resulting, in part, from improved off-network and original programming.
  • Broadcast Stations
    • Achieved higher rates for local TV station retransmission, driving 23% increase in fees.
  • Digital and Data
    • Acquisitions of Infostrada Statistics B.V. ("Infostrada Sports"), SportsDirect Inc. ("SportsDirect") and Covers Media Group ("Covers") combined to create Gracenote Sports, a leading provider of sports metadata.

"We are making noticeable progress against our strategy to build Tribune Media for sustainable, long-term, profitable growth. Our strategy is gaining momentum and accelerating top-line growth. Today's results reinforce our confidence that our strategy is the right one to drive long-term value for our shareholders," said Peter Liguori, Tribune Media's President and Chief Executive Officer.

"Our Television and Entertainment segment experienced revenue growth in all key areas and the outlook remains positive. We continue to post gains in our local station business due to its unique ability to deliver content to our loyal local viewers. Our decision to focus on local news and live sports, especially in major markets, is already paying dividends as we continue to grow advertising market share and generate higher retransmission fees. We are also encouraged that WGN America's conversion to a cable network is ahead of schedule and our investment in high quality original and syndicated content is creating value for our MVPD partners, advertisers and audience.  Our Digital and Data segment is demonstrating its ability to develop new revenue-generating solutions and services for its expanding client base. With four strategic acquisitions in the quarter, the Digital and Data business is furthering its position as a major player in the evolving sports and entertainment data arena."

Second Quarter and Year-to-Date 2015 Results

Consolidated Consolidated operating revenues for the second quarter of 2015 were $501.5 million compared to $475.0 million in the second quarter of 2014, representing an increase of $26.5 million, or 5.6%. Revenue increase driven by:

  • higher core advertising revenues (local and national advertising revenues, excluding political revenues),
  • retransmission consent revenues and carriage fees in the Television and Entertainment segment, and
  • the favorable impact of 2014 and 2015 acquisitions in the Digital and Data segment.

For the six months ended June 30, 2015, consolidated operating revenues were $974.3 million compared to $921.1 million in the six months ended June 29, 2014, representing an increase of $53.2 million, or 5.8%.

Consolidated operating profit for the second quarter of 2015 decreased by $12.4 million to $19.8 million, from $32.2 million in the second quarter of 2014. For the six months ended June 30, 2015, consolidated operating profit decreased $1.8 million to $80.7 million from $82.5 million in the six months ended June 29, 2014. 

Basic and diluted earnings (loss) per common share from continuing operations for the second quarter of 2015 were $(0.04) compared to $0.67 for the second quarter of 2014. The 2015 results include a pre-tax charge of $37 million in the second quarter of 2015 for loss on the extinguishment of debt related to the company's refinancing of its Term Loan Facility and issuance of $1.1 billion of 5.875% Senior Notes due in 2022.

Consolidated Adjusted EBITDA decreased to $92.3 million from $130.3 million in the second quarter of 2014, representing a decrease of $38.0 million, or 29%. The decline is primarily attributable to three factors:

  • Amortization of license fees increased by $24 million for our first-run original programs, "Salem" and "Manhattan" at WGN America; $13 million of the increase relates to the change in timing of this amortization from 2016 into 2015, which we previously disclosed in our guidance in the first quarter.
  • Production costs increased $11 million at Tribune Studios for our co-owned shows, "Manhattan" (second season), "Outsiders" and "Underground" as a result of production commencing on these three shows in the second quarter of this year.
  • We continued to incur implementation costs for improved technology applications and the establishment of new shared services operations, which efforts are expected to yield savings beginning in 2016.

For the six months ended June 30, 2015, consolidated Adjusted EBITDA decreased $47.0 million, or 18%, to $221.3 million as compared to $268.3 million in the six months ended June 29, 2014.

Cash distributions from equity investments in the second quarter of 2015 were $34.2 million compared to $35.5 million in the second quarter of 2014. Cash distributions for the six months ended June 30, 2015 were $129.1 million compared to $155.7 million for the six months ended June 29, 2014. Cash distributions were lower in the first half of 2015 due to a $12.4 million non-recurring cash payment from Television Food Network, G.P. ("TV Food Network") received in the first quarter of 2014, as well as the impact of working capital changes at TV Food Network which reduced cash available for distribution.  In addition, the Company also received a cash distribution in the second quarter of 2014 of $159.6 million from Classified Ventures, LLC in connection with the sale of its Apartments.com business.

Television and Entertainment Segment Television and Entertainment segment revenues were $445.6 million in the second quarter of 2015, compared to $427.0 million in the second quarter of 2014, an increase of $18.6 million, or 4.4%, and were comprised of:

  • Advertising revenues of $334.6 million as compared with $329.9 million in the second quarter of 2014, representing an increase of $4.7 million, or 1.4%. Core advertising (comprised of local and national advertising revenues, excluding political revenues) increased by $7.1 million, or 2.3%. Partially offsetting the increase in core advertising was a decrease in political advertising of $5.9 million due to 2015 being an off-cycle political year.
  • Local station retransmission consent fees of $70.1 million in the second quarter of 2015, compared to $57.1 million in the second quarter of 2014, an increase of $13.0 million, or 23%, as a result of contract renewals with distribution partners at higher rates that became effective in late 2014.
  • Carriage fees of $21.6 million in the second quarter of 2015 compared to $14.6 million in the second quarter of 2014, an increase of $7.0 million, or 48%, as a result of obtaining higher rates for WGN America distribution.

Television and Entertainment segment revenues for the six months ended June 30, 2015 were $855.9 million, compared to $827.2 million for the six months ended June 29, 2014. Specifically:

  • Advertising revenues were $634.3 million for the first half of 2015, a decrease of $1.4 million, or 0.2%, as compared to advertising revenues of $635.7 million in the first half of 2014.
  • Local station retransmission consent fees were $138.9 million, as compared to $112.7 million in the first half of 2014, an increase of $26.2 million, or 23%.
  • Carriage fees were $43.1 million, as compared to $28.7 million, an increase of $14.4 million, or 50%.

Television and Entertainment Adjusted EBITDA for the second quarter of 2015 was $104.3 million, compared to $140.6 million in the second quarter of 2014. Television and Entertainment Adjusted EBITDA was unfavorably impacted primarily by higher amortization of programming expenses and production costs associated with planned production funding for our co-owned original programming.

Consistent with the previously stated strategy, Tribune Studios made planned investments in co-owned original programming, including "Manhattan," "Underground" and "Outsiders". These investments in scripted original programming give the Company upside revenue potential through increased carriage fees and participation in the sale of domestic and international rights for these shows, including rights to stream the shows via video services.

For the six months ended June 30, 2015, Television and Entertainment Adjusted EBITDA was $239.2 million, as compared to $280.3 million for the six months ended June 29, 2014, a decrease of $41.1 million.

Digital and Data Segment Digital and Data segment revenues in the second quarter of 2015 were $43.6 million, compared to $33.8 million in the second quarter of 2014, an increase of $9.8 million, or 29%.  This increase included the favorable impact of the acquisitions of HWW, Baseline and What's ON, which were consummated in the second half of 2014, as well as the acquisitions of Infostrada Sports, SportsDirect, Covers and Enswers Inc., all of which were acquired in the second quarter of 2015.  For the six months ended June 30, 2015, Digital and Data segment revenues were $93.8 million, an increase of $28.5 million, as compared to $65.3 million for the six months ended June 29, 2014.

Digital and Data Adjusted EBITDA was $6.6 million in the second quarter of 2015, compared to a loss of $1.0 million in the second quarter of 2014, an increase of $7.6 million.  This increase included the favorable impact of the acquisitions noted above. For the six months ended June 30, 2015, Digital and Data Adjusted EBITDA was $19.1 million compared to $4.1 million in the six months ended June 29, 2014.

Corporate and Other Real estate revenues for the second quarter of 2015 were $12.3 million compared to $14.2 million in the second quarter of 2014, representing a decrease of $1.9 million, or 14%, due primarily to a reduction in space leased by Tribune Publishing Company at several properties and the sale of the production facility and land in Baltimore, MD in December 2014. Real estate revenues for the six months ended June 30, 2015 were $24.5 million, compared to $28.6 million for the six months ended June 29, 2014, representing a decrease of $4.1 million, or 14%.

Corporate and Other Adjusted EBITDA for the second quarter of 2015 represented a loss of $18.6 million, compared to a loss of $9.3 million in the second quarter of 2014. The increase in losses was primarily a result of increased corporate costs driven by the implementation of improved technology applications, as well as the establishment of new shared services operations following the separation from Tribune Publishing systems in connection with the Company's spin-off of its principal publishing operations in August 2014. For the six months ended June 30, 2015, Corporate and Other Adjusted EBITDA represented a loss of $37.1 million, compared to a loss of $16.1 million for the six months ended June 29, 2014.

Stock Repurchase Program

In October 2014, the Company announced a $400 million stock repurchase program, of which $233 million had been repurchased, as of March 29, 2015. During the second quarter of 2015, the Company repurchased approximately 0.4 million shares of the Company's Class A common stock in open market transactions for $20 million. From the period of March 30, 2015 through August 12, 2015, the Company repurchased approximately 1.9 million shares of the Company's Class A common stock for an aggregate purchase price of $100 million.  Since the inception of the stock repurchase program through August 12, 2015, the Company has repurchased an aggregate 5.8 million shares of the Company's Class A common stock, for an aggregate purchase price of approximately $333 million. As of August 12, 2015, the remaining authorized amount under the program totaled approximately $67 million.

Sale of Partnership Interest

On August 1, 2015, the Company agreed to sell all of its interest in Newsday Holdings LLC ("NHLLC") to CSC Holdings LLC, the current majority owner of NHLLC. Upon the consummation of such sale, $103 million of deferred tax liability on the Company's balance sheet will become payable and the Company expects to make this tax payment prior to the end of 2015.  

Financial Guidance

The following represents the Company's financial guidance for the full year 2015. The following statements, by their nature, are forward-looking and are subject to substantial risks and uncertainties, which are discussed below under "Cautionary Statement Regarding Forward-Looking Statements", and may differ materially from our actual results.

As a result of various company activities, certain components of 2015 full year guidance have been updated. Programming expense guidance for WGN America / Tribune Studios has been revised to include production expenses of co-owned series which were previously planned to be expensed in 2016 and are now being expensed in the second and third quarters of 2015. Cash taxes and cash interest have been updated primarily to reflect the impact of the Company's refinancing of its Term Loan Facility and issuance of $1.1 billion of 5.875% Senior Notes in June 2015. The revised cash tax guidance excludes the one-time payment of $103 million of cash taxes resulting from the sale of NHLLC as described above.

Notwithstanding these changes in guidance, the Company's overall revenue achievement and tight management of expenses across its businesses have kept it on track to meet its consolidated 2015 targets. Accordingly, we expect the following financial results as it relates to full-year 2015:

Consolidated

  • Net Revenues: $2.00 billion to $2.03 billion
  • Adjusted EBITDA: $480 million to $495 million

Television and Entertainment Segment

  • Total Net Revenues: $1.75 billion to $1.77 billion
  • Core Advertising (local and national advertising revenues): Low to mid-single digit increases over 2014
  • Retransmission Consent Fees: $275 million to $277 million
  • Cable Network Carriage Fees: $85 million to $87 million
  • WGN America / Tribune Studios Programming Expenses: $(150) million to $(160) million
    • Previous guidance of $(144) million
  • Adjusted EBITDA: $500 million to $515 million          

Digital and Data Segment

  • Net Revenues: $200 million to $205 million
  • Adjusted EBITDA: $46 million to $48 million

Corporate and Other

  • Real Estate Revenues: approximately $50 million
  • Real Estate Expenses: approximately $(30) million
  • Corporate Expenses, excluding stock-based comp: $(86) million to $(88) million
  • Adjusted EBITDA: $(66) million to $(68) million

Key Cash Flow Metrics

  • Capital Expenditures: Total of $100 million, including approximately $50 million of non-recurring capital expenditures
  • Cash Taxes(1): $95 million to $100 million
    • Previous guidance of $135 million to $140 million
  • Cash Interest: approximately $130 million
    • Previous guidance of $140 million
  • Depreciation & Amortization: approximately $260 million
  • Stock-based Compensation: approximately $35 million

(1)

Guidance excludes a tax payment of approximately $252 million related to the gain on the sale of Classified Ventures in the fourth quarter of 2014, paid in the first quarter of 2015. Also excluded from guidance is a tax payment of approximately $103 million related to the Company's agreement on August 1, 2015 to sell all of its interest in NHLLC to CSC Holdings LLC. The taxes associated with this transaction were on the balance sheet as of June 30, 2015 as a deferred tax liability and are now expected to be paid prior to the end of 2015.

 

Long Term Outlook

  • 2016 Consolidated Adjusted EBITDA year-over-year growth of greater than 30%

In addition, the Company currently expects the following for the period of 2016 - 2019:

  • WGN America and Tribune Studios revenue growth to be greater than 20% annually
  • WGN America and Tribune Studios programming expenses approximating 50% of net revenues
  • Digital and Data net revenue growth of 10% to 12% annually
  • Digital and Data Adjusted EBITDA margins growing to low 30% range

Conference Call Information

The Company will host a conference call today at 8:30 a.m. ET to discuss its second quarter results and a presentation deck will be posted to our website in advance of the call. The conference call can be accessed on the Investor Relations homepage of Tribune Media's website at www.tribunemedia.com, or by dialing (888) 317-6003 (domestic) or (412) 317-6061 (international). The confirmation code is 8454632.

An audio webcast replay will be available in the Events and Presentations section of the Tribune Media website approximately one hour after completion of the call. A replay of the call will also be available until August 21, 2015 at (877) 344-7529 (domestic) or (412) 317-0088 (international). The confirmation code for the replay is 10070360.

Tribune Media Company (NYSE: TRCO) is home to a diverse portfolio of television and digital properties driven by quality news, entertainment and sports programming. Tribune Media is comprised of Tribune Broadcasting's 42 owned or operated local television stations reaching more than 50 million households, national entertainment network WGN America, available in approximately 73 million households, Tribune Studios, and Gracenote, one of the world's leading sources of TV and music metadata powering electronic program guides in televisions, automobiles and mobile devices. Tribune Media also includes Chicago's WGN-AM and the national multicast networks Antenna TV and THIS TV. Additionally, the Company owns and manages a significant number of real estate properties across the U.S. and holds other strategic investments in media. For more information please visit www.tribunemedia.com.

Non-GAAP Financial Measures This press release includes a discussion of Adjusted EBITDA for the Company and our operating segments (Television and Entertainment, Digital and Data, and Corporate and Other) and presents Broadcast Cash Flow for our Television and Entertainment segment. Adjusted EBITDA and Broadcast Cash Flow are financial measures that are not recognized under accounting principles generally accepted in the U.S. ("GAAP"). Adjusted EBITDA for the Company is defined as net income before income (loss) from discontinued operations, net of taxes, income taxes, investment transactions, interest and dividend income, interest expense, pension expense (credit), equity income and losses, depreciation and amortization, stock-based compensation, certain special items (including severance), non-operating items, gain (loss) on sales of real estate and reorganization items. Adjusted EBITDA for the Company's operating segments is calculated as segment operating profit plus depreciation, amortization, pension expense (credit), stock-based compensation and certain special items (including severance). Broadcast Cash Flow for the Television and Entertainment segment is calculated as Television and Entertainment Adjusted EBITDA plus broadcast rights- amortization expense less broadcast rights- cash payments.  We believe that Adjusted EBITDA and Broadcast Cash Flow are measures commonly used by investors to evaluate our performance with that of our competitors. We also present Adjusted EBITDA because we believe investors, analysts and rating agencies consider it useful in measuring our ability to meet our debt service obligations. We further believe that the disclosure of Adjusted EBITDA and Broadcast Cash Flow is useful to investors, as these non-GAAP measures are used, among other measures, by our management to evaluate our performance. By disclosing Adjusted EBITDA and Broadcast Cash Flow, we believe that we create for investors a greater understanding of, and an enhanced level of transparency into, the means by which our management operates our company. Adjusted EBITDA and Broadcast Cash Flow are not measures presented in accordance with GAAP, and our use of these terms may vary from that of others in our industry. Adjusted EBITDA and Broadcast Cash Flow should not be considered as an alternative to net income, operating profit, revenues, cash provided by operating activities or any other measures derived in accordance with GAAP as measures of operating performance or liquidity.  The tables at the end of this press release include reconciliations of consolidated and segment Adjusted EBITDA and Broadcast Cash Flow to the most directly comparable financial measure calculated and presented in accordance with GAAP.  No reconciliation of the forecasted range for Adjusted EBITDA on a consolidated or segment basis for fiscal 2015 is included in this release because we are unable to quantify certain amounts that would be required to be included in the GAAP measure without unreasonable efforts and we believe such reconciliations would imply a degree of precision that would be confusing or misleading to investors.

Cautionary Statement Regarding Forward-Looking Statements This press release contains "forward-looking statements" within the meaning of the federal securities laws.  Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control.  Forward-looking statements may include, but are not limited to, statements concerning our financial outlook and guidance, including our 2015 forecasted revenues, Adjusted EBITDA and other consolidated and segment financial performance guidance, our expectations for Adjusted EBITDA growth in 2016, our long-term outlook for WGN America and Tribune Studios revenue and programming expenses as well as Digital and Data segment revenue growth and Adjusted EBITDA margins, the conditions in our industry, our operations, our economic performance and financial condition, including, in particular, statements relating to our business and growth strategy and product development efforts. Important factors that could cause actual results, developments and business decisions to differ materially from these forward-looking statements are uncertainties discussed below and in the "Risk Factors" section of the Company's Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the "SEC") on March 6, 2015 and other filings with the SEC.  "Forward-looking statements" include all statements that do not relate solely to historical or current facts, and can be identified by the use of words such as "may," "might," "will," "could" "should," "estimate," "project," "plan," "anticipate," "expect," "intend," "outlook," "seek," "designed," "assume," "implied," "believe" and other similar expressions. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. These forward-looking statements are based on estimates and assumptions by our management that, although we believe to be reasonable, are inherently uncertain and subject to a number of risks and uncertainties. 

The following list represents some, but not necessarily all, of the factors that could cause actual results to differ from projected or historical results or those anticipated or predicted by these forward-looking statements: competition and other economic conditions including fragmentation of the media landscape and competition from other media alternatives; changes in advertising demand and audience shares; changes in the overall market for television advertising, including through regulatory and judicial rulings;  our ability to protect our intellectual property and other proprietary rights; availability and cost of broadcast rights; our ability to adapt to technological changes; availability and cost of quality network, syndicated and sports programming affecting our television ratings; the loss or modification of our network affiliation agreements; our ability to renegotiate retransmission consent agreements; the incurrence of additional tax-related liabilities related to historical income tax returns; our ability to expand our operations internationally; the incurrence of costs to address contamination issues at sites owned, operated or used by our business; adverse results from litigation, governmental investigations or tax-related proceedings or audits; our ability to settle unresolved claims filed in connection with our and certain of our direct and indirect wholly-owned subsidiaries' Chapter 11 cases and resolve the appeals seeking to overturn the bankruptcy court order confirming the First Amended Joint Plan of Reorganization for Tribune Company and its Subsidiaries; our ability to satisfy pension and other postretirement employee benefit obligations; our ability to attract and retain employees; the effect of labor strikes, lock-outs and labor negotiations; our ability to realize benefits or synergies from acquisitions or divestitures or to operate our businesses effectively following acquisitions or divestitures; the financial performance of our equity method investments; the impairment of our existing goodwill and other intangible assets; compliance with both US and foreign government regulations applicable to our industry; changes in accounting standards; our ability to pay cash dividends on our common stock; increased interest rate risk due to our variable rate indebtedness; our indebtedness and ability to comply with covenants applicable to our debt financing and other contractual commitments; our ability to satisfy future capital and liquidity requirements; our ability to access the credit and capital markets at the times and in the amounts needed and on acceptable terms and other events beyond our control that may result in unexpected adverse operating results.  In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this press release may not in fact occur. Any forward-looking information presented herein is made only as of the date of this press release and we undertake no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

Tribune Media Company and Subsidiaries

Condensed Consolidated Statements of Operations

(In thousands of dollars, except per share data)

(Unaudited)

Three Months Ended

Six Months Ended

June 30, 2015

June 29, 2014

June 30, 2015

June 29, 2014

Operating Revenues

Television and Entertainment

$

445,622

$

426,961

$

855,922

$

827,162

Digital and Data

43,625

33,807

93,827

65,292

Other

12,277

14,211

24,512

28,627

Total operating revenues

501,524

474,979

974,261

921,081

Operating Expenses

Programming

137,682

94,992

231,198

175,623

Direct operating expenses

112,533

103,431

215,521

203,704

Selling, general and administrative

165,122

165,805

315,595

303,358

Depreciation

17,966

17,540

35,020

34,251

Amortization

48,437

61,018

96,208

121,692

Total operating expenses

481,740

442,786

893,542

838,628

Operating Profit

19,784

32,193

80,719

82,453

Income on equity investments, net

45,913

118,953

82,847

157,216

Interest and dividend income

43

147

410

318

Interest expense

(40,374)

(39,146)

(79,586)

(79,665)

Loss on extinguishment of debt

(37,040)

(37,040)

Gain on investment transactions

8,133

700

8,820

700

Other non-operating gain (loss)

211

(1,295)

211

(1,138)

Reorganization items, net

(628)

(2,165)

(1,620)

(4,381)

(Loss) Income from Continuing Operations Before Income Taxes

(3,958)

109,387

54,761

155,503

Income tax (benefit) expense

(693)

42,305

21,609

59,954

(Loss) Income from Continuing Operations

(3,265)

67,082

33,152

95,549

Income from Discontinued Operations, net of taxes

15,840

28,441

Net (Loss) Income

$

(3,265)

$

82,922

$

33,152

$

123,990

Basic (Loss) Earnings Per Common Share from:

Continuing Operations

$

(0.04)

$

0.67

$

0.34

$

0.96

Discontinued Operations

0.16

0.28

Net (Loss) Earnings Per Common Share

$

(0.04)

$

0.83

$

0.34

$

1.24

Diluted (Loss) Earnings Per Common Share from:

Continuing Operations

$

(0.04)

$

0.67

$

0.34

$

0.96

Discontinued Operations

0.16

0.28

Net (Loss) Earnings Per Common Share

$

(0.04)

$

0.83

$

0.34

$

1.24

Regular dividends declared per common share

$

0.25

$

$

0.25

$

Special dividends declared per common share

$

$

$

6.73

$

 

Tribune Media Company and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands of dollars, except for share and per share data)

(Unaudited)

June 30, 2015

December 28, 2014

Assets

Current Assets

Cash and cash equivalents

$          403,511

$                  1,455,183

Restricted cash and cash equivalents

17,595

17,600

Accounts receivable (net of allowances of $6,231 and $7,313)

425,947

440,722

Broadcast rights

99,187

147,423

Income taxes receivable

36,287

4,931

Deferred income taxes

34,191

29,675

Prepaid expenses

56,356

26,300

Other

40,301

38,989

Total current assets

1,113,375

2,160,823

Properties

Property, plant and equipment

984,662

953,438

Accumulated depreciation

(130,912)

(102,841)

Net properties

853,750

850,597

Other Assets

Broadcast rights

148,426

157,014

Goodwill

3,946,481

3,918,136

Other intangible assets, net

2,342,889

2,397,794

Investments

1,669,581

1,717,192

Other

172,914

194,899

Total other assets

8,280,291

8,385,035

Total Assets

$    10,247,416

$                11,396,455

 

Tribune Media Company and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands of dollars, except for share and per share data)

(Unaudited)

June 30, 2015

December 28, 2014

Liabilities and Shareholders' Equity

Current Liabilities

Accounts payable

$            77,671

$                        77,295

Debt due within one year

26,495

4,088

Income taxes payable

252,570

Employee compensation and benefits

66,755

80,270

Contracts payable for broadcast rights

148,534

178,685

Deferred revenue

32,457

34,352

Other

63,471

56,920

Total current liabilities

415,383

684,180

Non-Current Liabilities

Long-term debt

3,465,776

3,490,897

Deferred income taxes

1,157,650

1,156,214

Contracts payable for broadcast rights

262,145

279,819

Contract intangible liability, net

26,642

34,425

Pension obligations, net

457,535

469,116

Postretirement, medical, life and other benefits

21,434

21,456

Other obligations

65,705

64,917

Total non-current liabilities

5,456,887

5,516,844

Shareholders' Equity

Preferred stock ($0.001 par value per share)

Authorized: 40,000,000 shares; No shares issued and outstanding at June 30, 2015 and at Dec. 28, 2014

Class A Common Stock ($0.001 par value per share)

Authorized: 1,000,000,000 shares; 99,949,057 shares issued and 95,884,932 shares outstanding at June 30, 2015 and 95,708,401 shares issued and 94,732,807 shares outstanding at Dec. 28, 2014

100

96

Class B Common Stock ($0.001 par value per share)

Authorized: 1,000,000 shares at June 30, 2015 and 200,000,000 shares at Dec. 28, 2014; Issued and outstanding: 36,674 shares at June 30, 2015 and 2,438,083 shares at Dec. 28, 2014

2

Treasury stock, at cost: 4,064,125 shares at June 30, 2015 and 975,594 shares at Dec. 28, 2014

(253,014)

(67,814)

Additional paid-in-capital

4,604,317

4,591,470

Retained earnings

78,358

718,218

Accumulated other comprehensive loss

(55,939)

(46,541)

Total Tribune Media Company shareholders' equity

4,373,822

5,195,431

Noncontrolling interest

1,324

Total shareholders' equity

4,375,146

5,195,431

Total Liabilities and Shareholders' Equity

$    10,247,416

$                11,396,455

 

Tribune Media Company and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(In thousands of dollars)

(Unaudited)

Six Months Ended

June 30, 2015

June 29, 2014

Operating Activities

Net income

$           33,152

$         123,990

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Stock-based compensation

16,796

16,026

Pension credit, net of contributions

(14,583)

(18,932)

Depreciation

35,020

49,864

Amortization of contract intangible assets and liabilities

(7,079)

(17,946)

Amortization of other intangible assets

96,208

124,874

Income on equity investments, net

(82,847)

(156,587)

Distributions from equity investments

129,148

155,730

Non-cash loss on extinguishment of debt

33,480

Original issue discount payments

(6,158)

Amortization of debt issuance costs and original issue discount

6,690

6,675

Gain on investment transactions

(8,820)

(2,184)

Other non-operating (gain) loss

(211)

1,138

Change in excess tax benefits from stock-based awards

532

(896)

Transfers from restricted cash

5

684

Changes in working capital items, excluding effects from acquisitions:

Accounts receivable, net

16,925

55,291

Prepaid expenses and other current assets

(29,812)

(7,156)

Accounts payable

(4,174)

3,143

Employee compensation and benefits, accrued expenses and other current liabilities 

(8,567)

(36,291)

Deferred revenue

(2,420)

16,757

Income taxes

(284,524)

29,724

Change in broadcast rights, net of liabilities

8,998

(3,881)

Deferred income taxes

(5,805)

(57,589)

Other, net

1,668

(11,536)

Net cash (used in) provided by operating activities

(76,378)

270,898

Investing Activities

Capital expenditures

(38,717)

(39,597)

Acquisitions, net of cash acquired

(69,974)

(191,596)

Increase in restricted cash related to acquisition of Local TV

201,922

Transfers to restricted cash, net

(1,109)

Investments

(2,911)

(2,330)

Distributions from equity investments

159,602

Proceeds from sales of investments and real estate

13,750

705

Net cash (used in) provided by investing activities

(97,852)

127,597

Financing Activities

Long-term borrowings

1,100,000

Repayments of long-term debt

(1,100,342)

(11,848)

Repayment of Senior Toggle Notes

(172,237)

Long-term debt issuance costs

(20,207)

(2,584)

Payments of dividends

(672,744)

Common stock repurchases

(181,276)

Change in excess tax benefits from stock-based awards

(532)

896

Tax withholdings related to net share settlements of share-based awards

(3,831)

(3,201)

Proceeds from stock option exercises

166

1,006

Contribution from noncontrolling interest

1,324

Net cash used in financing activities

(877,442)

(187,968)

Net (Decrease) Increase in Cash and Cash Equivalents

(1,051,672)

210,527

Cash and cash equivalents, beginning of period

1,455,183

640,697

Cash and cash equivalents, end of period

$         403,511

$         851,224

Supplemental Schedule of Cash Flow Information

Cash paid during the period for:

Interest

$           81,981

$           67,086

Income taxes, net of refunds

$         311,672

$         107,539

 

Tribune Media Company - Consolidated

Reconciliation of Net Income to Adjusted EBITDA

(In thousands of dollars)

(Unaudited)

Three Months Ended

Six Months Ended

June 30, 2015

June 29, 2014

June 30, 2015

June 29, 2014

Revenues

$         501,524

$         474,979

$         974,261

$         921,081

Net (Loss) Income

$           (3,265)

$           82,922

$           33,152

$         123,990

Income from discontinued operations, net of taxes

15,840

28,441

(Loss) Income from Continuing Operations

(3,265)

67,082

33,152

95,549

Income tax (benefit) expense

(693)

42,305

21,609

59,954

Reorganization items, net

628

2,165

1,620

4,381

Other non-operating (gain) loss

(211)

1,295

(211)

1,138

Gain on investment transaction

(8,133)

(700)

(8,820)

(700)

Loss on extinguishment of debt

37,040

37,040

Interest expense

40,374

39,146

79,586

79,665

Interest and dividend income

(43)

(147)

(410)

(318)

Income on equity investments, net

(45,913)

(118,953)

(82,847)

(157,216)

Operating Profit

19,784

32,193

80,719

82,453

Depreciation

17,966

17,540

35,020

34,251

Amortization

48,437

61,018

96,208

121,692

Stock-based compensation

8,951

6,121

16,796

14,570

Severance and related charges

335

712

1,236

3,151

Transaction-related costs

3,825

2,234

5,463

7,933

Loss on sales of real estate

(9)

97

Contract termination cost

15,646

15,646

Other

300

2,398

333

3,956

Pension credit

(7,280)

(7,518)

(14,583)

(15,322)

Adjusted EBITDA

$           92,309

$         130,344

$         221,289

$         268,330

 

Tribune Media Company - Television and Entertainment

Reconciliation of Operating Profit to Adjusted EBITDA and Broadcast Cash Flow

(In thousands of dollars)

(Unaudited)

Three Months Ended

Six Months Ended

June 30, 2015

June 29, 2014

June 30, 2015

June 29, 2014

Advertising

$         334,557

$         329,928

$         634,259

$         635,691

Retransmission consent fees

70,078

57,122

138,891

112,687

Carriage fees

21,618

14,591

43,120

28,719

Barter/trade

9,561

10,472

18,787

20,783

Copyright royalties

3,832

7,454

8,097

13,986

Other

5,976

7,394

12,768

15,296

Total Revenues (1)

$         445,622

$         426,961

$         855,922

$         827,162

Operating Profit (1)

$           47,088

$           52,414

$         126,436

$         117,111

Depreciation

12,023

13,136

23,446

25,512

Amortization

41,475

56,172

82,985

112,827

Stock-based compensation

3,340

2,113

5,833

4,636

Severance and related charges

340

108

536

1,522

Transaction-related costs

974

1,391

Contract termination cost

15,646

15,646

Other

12

13

1,568

Pension expense

61

104

Adjusted EBITDA (1)

$         104,266

$         140,636

$         239,249

$         280,317

Broadcast rights - Amortization

110,913

74,386

182,921

130,080

Broadcast rights - Cash Payments

(117,062)

(86,409)

(201,777)

(147,227)

Broadcast Cash Flow

$           98,117

$         128,613

$         220,393

$         263,170

 

(1)

At the beginning of fiscal 2015, the Company moved its Zap2it.com entertainment website business from the Digital and Data reportable segment to the Television and Entertainment reportable segment. Certain previously reported amounts have been reclassified to conform to the current presentation; the impact of this reclassification was immaterial.

 

Tribune Media Company - Digital and Data

Reconciliation of Operating Profit to Adjusted EBITDA

(In thousands of dollars)

(Unaudited)

Three Months Ended

Six Months Ended

June 30, 2015

June 29, 2014

June 30, 2015

June 29, 2014

Video and other

$           29,329

$           21,585

$           55,551

$           42,357

Music

14,296

12,222

38,276

22,935

Total Revenues (1)

$           43,625

$           33,807

$           93,827

$           65,292

Operating Profit (Loss) (1)

$           (4,150)

$           (8,910)

$               (416)

$         (10,996)

Depreciation

2,321

1,909

4,426

3,722

Amortization

6,962

4,846

13,223

8,865

Stock-based compensation

679

688

1,230

1,337

Severance and related charges

(16)

504

(189)

1,136

Transaction-related costs

547

547

Other

300

300

Adjusted EBITDA (1)

$              6,643

$               (963)

$           19,121

$              4,064

 

(1)

At the beginning of fiscal 2015, the Company moved its Zap2it.com entertainment website business from the Digital and Data reportable segment to the Television and Entertainment reportable segment. Certain previously reported amounts have been reclassified to conform to the current presentation; the impact of this reclassification was immaterial.

 

Tribune Media Company - Corporate and Other

Reconciliation of Operating Profit to Adjusted EBITDA

(In thousands of dollars)

(Unaudited)

Three Months Ended

Six Months Ended

June 30, 2015

June 29, 2014

June 30, 2015

June 29, 2014

Total Revenues

$           12,277

$           14,211

$           24,512

$           28,627

Operating Loss

$         (23,154)

$         (11,311)

$         (45,301)

$         (23,662)

Depreciation

3,622

2,495

7,148

5,017

Stock-based compensation

4,932

3,320

9,733

8,597

Severance and related charges

11

100

889

493

Transaction-related costs

3,278

1,260

4,916

6,542

Loss on sales of real estate

(9)

97

Other

2,386

20

2,388

Pension credit

(7,280)

(7,579)

(14,583)

(15,426)

Adjusted EBITDA

$         (18,600)

$           (9,329)

$         (37,081)

$         (16,051)

 

SOURCE Tribune Media Company



RELATED LINKS

http://www.tribunemedia.com