-
Completed reattribution of Live Nation stake and other assets and liabilities between
Formula One Group andLiberty SiriusXM Group tracking stocks onApril 22 nd-
Intend to launch
$750 million subscription rights offering onMay 18 th to Liberty SiriusXM shareholders to pay off intergroup loan owed toFormula One Group
-
Intend to launch
-
Attributed to
Liberty SiriusXM Group -
SiriusXM reported first quarter 2020 financial results-
SiriusXM responds to COVID-19 crisis; company withdrew 2020 guidance on 4/28 -
Self-pay net subscriber additions of 69,000 reported for first quarter
-
First quarter revenue of
$2.0 billion ; a pro forma increase of 5% -
First quarter net income of
$293 million ; diluted EPS of$0.07 -
Adjusted EBITDA(2) reached
$639 million in the first quarter, up 13%
-
-
Liberty Media’s ownership of
SiriusXM stood at 72.2% as ofApril 24 th -
From
February 1 st throughApril 30 th,Liberty SiriusXM Group repurchased 863 thousand LSXMA/K shares for total cash consideration of$41 million -
Corporate level liquidity as of
March 31 st pro forma for reattribution-
$1.0 billion cash, cash equivalents and undrawn margin loan capacity (excluding liquidity atSiriusXM )
-
-
-
Attributed to
Formula One Group -
Expect F1 racing to begin in July with targeted 15 to 18 races this season
-
Liquidity as of
March 31 st pro forma for reattribution-
$2.5 billion cash, cash equivalents and revolver capacity (including$1.0 billion liquidity at F1)
-
-
Expect F1 racing to begin in July with targeted 15 to 18 races this season
-
Attributed to
Braves Group -
MLB evaluating multiple options for 2020 season commencement
-
Liquidity as of
March 31 st-
$348 million cash, restricted cash, cash equivalents and revolver capacity (including$268 million liquidity atBraves )
-
-
MLB evaluating multiple options for 2020 season commencement
“We are operating in unprecedented times, impacting the Liberty portfolio across the globe. Our companies in the live event space have been working with players, teams, bands, fans and government authorities to operate during social distancing and safely provide unique and engaging experiences. We thank our employees and partners for their dedication, flexibility and leadership,” said
Note on COVID-19
Corporate Updates
On
The reattribution is not reflected in Liberty Media’s first quarter financial results but will be reflected in the second quarter results on a prospective basis.
Discussion of Results
Unless otherwise noted, the following discussion compares financial information for the three months ended
LIBERTY SIRIUSXM GROUP – The following table provides the financial results attributed to
|
|
1Q19 |
|
1Q20 |
|
% Change |
|||||||
|
|
amounts in millions |
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|||
Revenue |
|
|
|
|
|
|
|
|
|
|
|||
|
|
$ |
1,744 |
|
|
$ |
1,952 |
|
|
|
12 |
|
% |
|
|
$ |
1,744 |
|
|
$ |
1,952 |
|
|
|
12 |
|
% |
Operating Income (Loss) |
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
316 |
|
|
|
451 |
|
|
|
43 |
|
% |
Corporate and other |
|
|
(9 |
) |
|
|
(9 |
) |
|
|
— |
% |
|
|
|
$ |
307 |
|
|
$ |
442 |
|
|
|
44 |
|
% |
Adjusted OIBDA |
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
590 |
|
|
|
639 |
|
|
|
8 |
|
% |
Corporate and other |
|
|
(2 |
) |
|
|
(7 |
) |
|
|
(250 |
) |
% |
|
|
$ |
588 |
|
|
$ |
632 |
|
|
|
7 |
|
% |
The financial results above include the results of Pandora beginning
The businesses and assets attributed to
“We are thankful to the FIA, teams, promoters, our employees and other key partners for their support and efforts during this challenging time,” said
|
|
1Q19 |
|
1Q20 |
||||
|
|
amounts in millions |
||||||
|
|
|
|
|
|
|
||
Revenue |
|
|
|
|
|
|
||
Formula 1 |
|
$ |
246 |
|
|
$ |
39 |
|
|
|
$ |
246 |
|
|
$ |
39 |
|
Operating Income (Loss) |
|
|
|
|
|
|
||
Formula 1 |
|
$ |
(47 |
) |
|
$ |
(137 |
) |
Corporate and other |
|
|
(11 |
) |
|
|
(15 |
) |
|
|
$ |
(58 |
) |
|
$ |
(152 |
) |
Adjusted OIBDA |
|
|
|
|
|
|
||
Formula 1 |
|
$ |
65 |
|
|
$ |
(32 |
) |
Corporate and other |
|
|
(6 |
) |
|
|
(10 |
) |
|
|
$ |
59 |
|
|
$ |
(42 |
) |
The following table provides the operating results of Formula 1 (“F1”).
F1 Operating Results
|
1Q19 |
|
1Q20 |
|
% Change |
|||||||
|
amounts in millions |
|
|
|
||||||||
Primary Formula 1 revenue |
$ |
198 |
|
|
$ |
13 |
|
|
(93 |
) |
% |
|
Other Formula 1 revenue |
|
48 |
|
|
|
26 |
|
|
(46 |
) |
% |
|
Total Formula 1 revenue |
$ |
246 |
|
|
$ |
39 |
|
|
(84 |
) |
% |
|
Operating expenses (excluding stock-based compensation included below): |
|
|
|
|
|
|
|
|
||||
Team payments |
|
(96 |
) |
|
|
— |
|
100 |
|
% |
||
Other cost of Formula 1 revenue |
|
(52 |
) |
|
|
(43 |
) |
|
17 |
|
% |
|
Cost of Formula 1 revenue |
$ |
(148 |
) |
|
$ |
(43 |
) |
|
71 |
|
% |
|
Selling, general and administrative expenses |
|
(33 |
) |
|
|
(28 |
) |
|
15 |
|
% |
|
Adjusted OIBDA |
$ |
65 |
|
|
$ |
(32 |
) |
|
(149 |
) |
% |
|
Stock-based compensation |
|
(4 |
) |
|
|
(4 |
) |
|
— |
% |
||
Depreciation and Amortization |
|
(108 |
) |
|
|
(101 |
) |
|
6 |
|
% |
|
Operating income |
$ |
(47 |
) |
|
$ |
(137 |
) |
|
(191 |
) |
% |
|
|
|
|
|
|
|
|
|
|
||||
Number of races in period |
|
2 |
|
|
|
0 |
|
|
|
|
Primary F1 revenue is comprised of (i) race promotion fees, (ii) broadcasting fees and (iii) advertising and sponsorship fees. Due to the outbreak of COVID-19, there were no F1 races held in the first quarter of 2020. F1 currently expects racing to commence in July and continue through December with a target calendar of 15 to 18 races. It is currently unknown at what point fans will be permitted to attend.
Since there were no events held during the first quarter of 2020, primary F1 revenue consisted only of the elements of sponsorship contracts associated with non-race related rights that were recognized during the period, and no race promotion fees nor broadcasting fees were recognized. Similarly, other F1 revenue decreased due to zero revenue recognized from the
Operating loss increased and Adjusted OIBDA(2) decreased in the first quarter. There was no team payment expense recorded since such payments are recognized on a pro-rata basis across races on the calendar. Other cost of F1 revenue is largely variable in nature and relates directly to revenue opportunities. These costs decreased primarily due to no races taking place and the deferral of non-critical expenses. Certain costs were incurred during the first quarter in anticipation of the start of the 2020 race season, including freight, travel and technical costs relating to the Australian Grand Prix, which was cancelled on the eve of the event. Selling, general and administrative decreased due to lower expenditures for discretionary items such as marketing and lower personnel costs, partially offset by the effects of foreign exchange related losses. F1 implemented certain cost cutting measures, including salary reductions and
F1’s total net debt to covenant OIBDA ratio, as defined in F1’s credit facilities for covenant calculations, was 6.0x as of
The businesses and assets attributed to the
BRAVES GROUP - The following table provides the financial results attributed to the
|
|
1Q19 |
|
1Q20 |
||||
|
|
amounts in millions |
||||||
|
|
|
|
|
|
|
||
Revenue |
|
|
|
|
|
|
||
Corporate and other |
|
$ |
22 |
|
|
$ |
22 |
|
Operating Income |
|
|
|
|
|
|
||
Corporate and other |
|
$ |
(49 |
) |
|
$ |
(44 |
) |
Adjusted OIBDA |
|
|
|
|
|
|
||
Corporate and other |
|
$ |
(33 |
) |
|
$ |
(26 |
) |
The following table provides the operating results of
|
1Q19 |
|
1Q20 |
|
% Change |
|||||||
|
amounts in millions |
|
|
|
||||||||
Baseball revenue |
$ |
14 |
|
|
$ |
12 |
|
|
(14 |
) |
% |
|
Development revenue |
|
8 |
|
|
|
10 |
|
|
25 |
|
% |
|
Total revenue |
|
22 |
|
|
|
22 |
|
|
— |
% |
||
Operating expenses (excluding stock-based compensation included below): |
|
|
|
|
|
|
|
|
||||
Other operating expenses |
|
(31 |
) |
|
|
(29 |
) |
|
6 |
|
% |
|
Selling, general and administrative expenses |
|
(22 |
) |
|
|
(18 |
) |
|
18 |
|
% |
|
Adjusted OIBDA |
$ |
(31 |
) |
|
$ |
(25 |
) |
|
19 |
|
% |
|
Stock-based compensation |
|
(3 |
) |
|
|
(3 |
) |
|
— |
% |
||
Depreciation and Amortization |
|
(13 |
) |
|
|
(15 |
) |
|
(15 |
) |
% |
|
Operating income |
$ |
(47 |
) |
|
$ |
(43 |
) |
|
9 |
|
% |
|
|
|
|
|
|
|
|
|
|
||||
Number of home games in period |
|
— |
|
|
— |
|
|
|
Baseball revenue is comprised of (i) ballpark operations (ticket sales, concessions, corporate sales, retail, suites, premium seat fees and postseason), (ii) local broadcast rights and (iii) national broadcast rights, licensing and other shared MLB revenue streams. Development revenue is derived from the Battery Atlanta mixed-use facilities and primarily includes rental income. Due to the outbreak of COVID-19, MLB postponed the start of the 2020 season and shortened spring-training. It is currently unknown when the season will begin and, at such point, if fans will be allowed to attend.
Baseball revenue decreased in the first quarter of 2020 primarily driven by the postponement of the 2020 season and subsequent delay in recognizing local and national broadcasting revenue. The increase in development revenue was primarily driven by an increase in variable income at the retail portion of the Battery.
Operating loss decreased and Adjusted OIBDA increased in the first quarter driven by lower expenses. With the postponement of the 2020 season, operating expense decreased primarily due to the delay in recognition of player salaries, and selling, general and administrative expense decreased as a result of the delay in certain marketing initiatives.
The
The businesses and assets attributed to the
Share Repurchases
From
From
The total remaining repurchase authorization for
FOOTNOTES
1) |
|
|
2) |
For definitions of Adjusted OIBDA (as defined by |
NOTES
The following financial information with respect to
Fair Value of
(amounts in millions) |
|
|
|
|
|
||
|
|
|
|
|
|
|
|
iHeart(1) |
|
$ |
118 |
|
$ |
51 |
|
|
|
$ |
118 |
|
$ |
51 |
|
|
|
|
|
|
|
|
|
|
|
$ |
4,978 |
|
|
3,166 |
|
Other |
|
|
242 |
|
|
180 |
|
|
|
$ |
5,220 |
|
$ |
3,346 |
|
|
|
|
N/A |
|
|
N/A |
|
Total |
|
$ |
5,338 |
|
$ |
3,397 |
|
(1) |
Includes fair value of iHeart shares and warrants which are included in other long-term assets. |
|
(2) |
Represents the fair value of the equity investment attributed to |
|
(3) |
Represents the carrying value of other public holdings which are accounted for at fair value. |
Cash and Debt
The following presentation is provided to separately identify cash and liquid investments and debt information and does not reflect the impact of the reattribution completed on
(amounts in millions) |
|
|
|
|
|
||||
Cash, Cash Equivalents and Restricted Cash Attributable to: |
|
|
|
|
|
|
|
||
|
|
$ |
507 |
|
|
$ |
398 |
|
|
|
|
|
587 |
|
|
|
1,094 |
|
|
|
|
|
212 |
|
|
|
343 |
|
|
Total Consolidated Cash, Cash Equivalents and Restricted Cash (GAAP) |
|
$ |
1,306 |
|
|
$ |
1,835 |
|
|
|
|
|
|
|
|
|
|
||
Debt: |
|
|
|
|
|
|
|
||
|
|
$ |
7,750 |
|
|
$ |
7,750 |
|
|
Pandora convertible senior notes |
|
|
194 |
|
|
|
194 |
|
|
2.125% exchangeable senior debentures due 2048(5) |
|
|
400 |
|
|
|
400 |
|
|
2.75% exchangeable senior debentures due 2049(5) |
|
|
604 |
|
|
|
604 |
|
|
Margin loans |
|
|
350 |
|
|
|
350 |
|
|
Other subsidiary debt(6) |
|
|
— |
|
|
— |
|
||
Total Attributed Liberty SiriusXM Group Debt |
|
$ |
9,298 |
|
|
$ |
9,298 |
|
|
Unamortized discount, fair market value adjustment and deferred loan costs |
|
|
(53 |
) |
|
|
(227 |
) |
|
Total Attributed Liberty SiriusXM Group Debt (GAAP) |
|
$ |
9,245 |
|
|
$ |
9,071 |
|
|
|
|
|
|
|
|
|
|
||
1.375% cash convertible notes due 2023(5) |
|
|
1,000 |
|
|
|
1,000 |
|
|
1% cash convertible notes due 2023(5) |
|
|
450 |
|
|
|
450 |
|
|
2.25% exchangeable senior debentures due 2046(5) |
|
|
208 |
|
|
|
207 |
|
|
2.25% exchangeable senior debentures due 2048(5) |
|
|
385 |
|
|
|
385 |
|
|
Live Nation margin loan |
|
|
130 |
|
|
|
— |
|
|
Formula 1 term loan and revolving credit facility |
|
|
2,902 |
|
|
|
3,377 |
|
|
Other corporate level debt |
|
|
32 |
|
|
|
31 |
|
|
Total Attributed Formula One Group Debt |
|
$ |
5,107 |
|
|
$ |
5,450 |
|
|
Fair market value adjustment and deferred loan costs |
|
|
570 |
|
|
|
(72 |
) |
|
Total Attributed Formula One Group Debt (GAAP) |
|
$ |
5,677 |
|
|
$ |
5,378 |
|
|
Formula 1 leverage(7) |
|
|
5.1x |
|
|
6.0x |
|
||
|
|
|
|
|
|
|
|
||
|
|
|
559 |
|
|
|
698 |
|
|
Total Attributed Braves Group Debt |
|
$ |
559 |
|
|
$ |
698 |
|
|
Deferred loan costs |
|
|
(5 |
) |
|
|
(4 |
) |
|
Total Attributed Braves Group Debt (GAAP) |
|
$ |
554 |
|
|
$ |
694 |
|
|
|
|
|
|
|
|
|
|
||
Total Liberty Media Corporation Debt (GAAP) |
|
$ |
15,476 |
|
|
$ |
15,143 |
|
|
(1) |
Includes |
|
(2) |
Includes restricted cash held in reserves pursuant to the terms of various financial obligations. |
|
(3) |
Includes |
|
(4) |
Outstanding principal amount of Senior Notes with no reduction for the net unamortized discount. |
|
(5) |
Face amount of the cash convertible notes and exchangeable debentures with no fair market value adjustment. |
|
(6) |
Includes |
|
(7) |
Net debt to covenant OIBDA ratio of F1 operating business as defined in F1’s credit facilities for covenant calculations. |
Total cash, liquid investments and restricted cash attributed to
Total cash and liquid investments attributed to the
Total debt at
Total cash, liquid investments and restricted cash attributed to the
Important Notice:
This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about business strategies, market potential, future financial prospects, Formula 1’s race calendar; MLB’s 2020 season; the impact of COVID-19; the expected benefits from the reattribution; the rights offering; plans regarding stock repurchases and other matters that are not historical facts. These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, possible changes in market acceptance of new products or services, regulatory matters affecting our businesses, the unfavorable outcome of pending or future litigation, the failure to realize benefits of acquisitions, rapid technological and industry change, continued access to capital on terms acceptable to
Not a Solicitation
This press release does not constitute an offer to sell or the solicitation of an offer to buy nor will there be any sale of any securities referred to in this press release in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. The rights offering will be made only by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended.
BALANCE SHEET INFORMATION
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
Attributed |
|
|
|
|
||||||||||
|
|
Liberty |
|
|
|
Formula |
|
|
|
|
||||||
|
|
|
|
|
|
One |
|
Intergroup |
|
Consolidated |
||||||
|
|
Group |
|
Group |
|
Group |
|
Eliminations |
|
Liberty |
||||||
|
|
amounts in millions |
||||||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|||||
Current assets: |
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents |
|
$ |
386 |
|
|
321 |
|
|
1,094 |
|
|
— |
|
1,801 |
|
|
Trade and other receivables, net |
|
|
604 |
|
|
30 |
|
|
66 |
|
|
— |
|
700 |
|
|
Other current assets |
|
|
239 |
|
|
26 |
|
|
223 |
|
|
— |
|
488 |
|
|
Total current assets |
|
|
1,229 |
|
|
377 |
|
|
1,383 |
|
|
— |
|
2,989 |
|
|
Intergroup interests |
|
|
— |
|
— |
|
235 |
|
|
(235 |
) |
|
— |
|||
Investments in affiliates, accounted for using the equity method |
|
|
670 |
|
|
101 |
|
|
671 |
|
|
— |
|
1,442 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Property and equipment, at cost |
|
|
2,689 |
|
|
945 |
|
|
169 |
|
|
— |
|
3,803 |
|
|
Accumulated depreciation |
|
|
(1,359 |
) |
|
(141 |
) |
|
(58 |
) |
|
— |
|
(1,558 |
) |
|
|
|
|
1,330 |
|
|
804 |
|
|
111 |
|
|
— |
|
2,245 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Intangible assets not subject to amortization |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
15,803 |
|
|
180 |
|
|
3,956 |
|
|
— |
|
19,939 |
|
|
|
|
|
8,600 |
|
|
— |
|
— |
|
— |
|
8,600 |
|
|||
Other |
|
|
1,262 |
|
|
143 |
|
|
— |
|
— |
|
1,405 |
|
||
|
|
|
25,665 |
|
|
323 |
|
|
3,956 |
|
|
— |
|
29,944 |
|
|
Intangible assets subject to amortization, net |
|
|
1,555 |
|
|
33 |
|
|
4,202 |
|
|
— |
|
5,790 |
|
|
Other assets |
|
|
659 |
|
|
77 |
|
|
804 |
|
|
(32 |
) |
|
1,508 |
|
Total assets |
|
$ |
31,108 |
|
|
1,715 |
|
|
11,362 |
|
|
(267 |
) |
|
43,918 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Liabilities and Equity |
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|||||
Intergroup payable (receivable) |
|
$ |
(19 |
) |
|
(13 |
) |
|
32 |
|
|
— |
|
— |
||
Accounts payable and accrued liabilities |
|
|
1,107 |
|
|
51 |
|
|
150 |
|
|
— |
|
1,308 |
|
|
Current portion of debt |
|
|
1 |
|
|
114 |
|
|
475 |
|
|
— |
|
590 |
|
|
Deferred revenue |
|
|
1,923 |
|
|
108 |
|
|
554 |
|
|
— |
|
2,585 |
|
|
Other current liabilities |
|
|
75 |
|
|
5 |
|
|
21 |
|
|
— |
|
101 |
|
|
Total current liabilities |
|
|
3,087 |
|
|
265 |
|
|
1,232 |
|
|
— |
|
4,584 |
|
|
Long-term debt |
|
|
9,070 |
|
|
580 |
|
|
4,903 |
|
|
— |
|
14,553 |
|
|
Deferred income tax liabilities |
|
|
1,947 |
|
|
49 |
|
|
— |
|
(32 |
) |
|
1,964 |
|
|
Redeemable intergroup interests |
|
|
62 |
|
|
173 |
|
|
— |
|
(235 |
) |
|
— |
||
Other liabilities |
|
|
665 |
|
|
221 |
|
|
229 |
|
|
— |
|
1,115 |
|
|
Total liabilities |
|
|
14,831 |
|
|
1,288 |
|
|
6,364 |
|
|
(267 |
) |
|
22,216 |
|
Equity / Attributed net assets |
|
|
10,745 |
|
|
427 |
|
|
4,995 |
|
|
— |
|
16,167 |
|
|
Noncontrolling interests in equity of subsidiaries |
|
|
5,532 |
|
|
— |
|
3 |
|
|
— |
|
5,535 |
|
||
Total liabilities and equity |
|
$ |
31,108 |
|
|
1,715 |
|
|
11,362 |
|
|
(267 |
) |
|
43,918 |
|
STATEMENT OF OPERATIONS
Three months ended |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
Attributed |
|
|
|||||||||
|
|
Liberty |
|
|
|
Formula |
|
|
|||||
|
|
|
|
|
|
One |
|
Consolidated |
|||||
|
|
Group |
|
Group |
|
Group |
|
Liberty |
|||||
|
|
amounts in millions |
|||||||||||
Revenue: |
|
|
|
|
|
|
|
|
|
||||
|
|
$ |
1,952 |
|
|
— |
|
— |
|
1,952 |
|
||
Formula 1 revenue |
|
|
— |
|
— |
|
39 |
|
|
39 |
|
||
Other revenue |
|
|
— |
|
22 |
|
|
— |
|
22 |
|
||
Total revenue |
|
|
1,952 |
|
|
22 |
|
|
39 |
|
|
2,013 |
|
Operating costs and expenses, including stock-based compensation: |
|
|
|
|
|
|
|
|
|
||||
Cost of services (exclusive of depreciation shown separately below): |
|
|
|
|
|
|
|
|
|
||||
Revenue share and royalties |
|
|
570 |
|
|
— |
|
— |
|
570 |
|
||
Programming and content(1) |
|
|
118 |
|
|
— |
|
— |
|
118 |
|
||
Customer service and billing(1) |
|
|
118 |
|
|
— |
|
— |
|
118 |
|
||
Other(1) |
|
|
44 |
|
|
— |
|
— |
|
44 |
|
||
Cost of Formula 1 revenue |
|
|
— |
|
— |
|
43 |
|
|
43 |
|
||
Subscriber acquisition costs |
|
|
99 |
|
|
— |
|
— |
|
99 |
|
||
Other operating expenses(1) |
|
|
71 |
|
|
29 |
|
|
— |
|
100 |
|
|
Selling, general and administrative(1) |
|
|
342 |
|
|
22 |
|
|
44 |
|
|
408 |
|
Depreciation and amortization |
|
|
148 |
|
|
15 |
|
|
104 |
|
|
267 |
|
|
|
|
1,510 |
|
|
66 |
|
|
191 |
|
|
1,767 |
|
Operating income (loss) |
|
|
442 |
|
|
(44 |
) |
|
(152 |
) |
|
246 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
|
(111 |
) |
|
(7 |
) |
|
(46 |
) |
|
(164 |
) |
Share of earnings (losses) of affiliates, net |
|
|
(2 |
) |
|
4 |
|
|
(64 |
) |
|
(62 |
) |
Realized and unrealized gains (losses) on financial instruments, net |
|
|
(5 |
) |
|
(9 |
) |
|
15 |
|
|
1 |
|
Unrealized gains (losses) on intergroup interests |
|
|
31 |
|
|
95 |
|
|
(126 |
) |
|
— |
|
Other, net |
|
|
13 |
|
|
(1 |
) |
|
5 |
|
|
17 |
|
|
|
|
(74 |
) |
|
82 |
|
|
(216 |
) |
|
(208 |
) |
Earnings (loss) from continuing operations before income taxes |
|
|
368 |
|
|
38 |
|
|
(368 |
) |
|
38 |
|
Income tax (expense) benefit |
|
|
(76 |
) |
|
15 |
|
|
25 |
|
|
(36 |
) |
Net earnings (loss) |
|
|
292 |
|
|
53 |
|
|
(343 |
) |
|
2 |
|
Less net earnings (loss) attributable to the noncontrolling interests |
|
|
78 |
|
|
— |
|
— |
|
78 |
|
||
Net earnings (loss) attributable to Liberty stockholders |
|
$ |
214 |
|
|
53 |
|
|
(343 |
) |
|
(76 |
) |
|
|
|
|
|
|
|
|
|
|
||||
(1) Includes stock-based compensation expense as follows: |
|
|
|
|
|
|
|
|
|
||||
Programming and content |
|
|
8 |
|
|
— |
|
— |
|
8 |
|
||
Customer service and billing |
|
|
2 |
|
|
— |
|
— |
|
2 |
|
||
Other |
|
|
1 |
|
|
— |
|
— |
|
1 |
|
||
Other operating expenses |
|
|
11 |
|
|
— |
|
— |
|
11 |
|
||
Selling, general and administrative |
|
|
36 |
|
|
3 |
|
|
6 |
|
|
45 |
|
Stock compensation expense |
$ |
58 |
|
3 |
|
6 |
67 |
||||||
STATEMENT OF OPERATIONS
Three months ended |
|||||||||||||
|
|
Attributed |
|
|
|||||||||
|
|
Liberty |
|
|
|
Formula |
|
|
|||||
|
|
|
|
|
|
One |
|
Consolidated |
|||||
|
|
Group |
|
Group |
|
Group |
|
Liberty |
|||||
|
|
amounts in millions |
|||||||||||
Revenue: |
|
|
|
|
|
|
|
|
|
||||
|
|
$ |
1,744 |
|
|
— |
|
— |
|
1,744 |
|
||
Formula 1 revenue |
|
|
— |
|
— |
|
246 |
|
|
246 |
|
||
Other revenue |
|
|
— |
|
22 |
|
|
— |
|
22 |
|
||
Total revenue |
|
|
1,744 |
|
|
22 |
|
|
246 |
|
|
2,012 |
|
Operating costs and expenses, including stock-based compensation: |
|
|
|
|
|
|
|
|
|
||||
Cost of services (exclusive of depreciation shown separately below): |
|
|
|
|
|
|
|
|
|
||||
Revenue share and royalties |
|
|
492 |
|
|
— |
|
— |
|
492 |
|
||
Programming and content(1) |
|
|
106 |
|
|
— |
|
— |
|
106 |
|
||
Customer service and billing(1) |
|
|
113 |
|
|
— |
|
— |
|
113 |
|
||
Other(1) |
|
|
37 |
|
|
— |
|
— |
|
37 |
|
||
Cost of Formula 1 revenue |
|
|
— |
|
— |
|
148 |
|
|
148 |
|
||
Subscriber acquisition costs |
|
|
108 |
|
|
— |
|
— |
|
108 |
|
||
Other operating expenses(1) |
|
|
54 |
|
|
31 |
|
|
— |
|
85 |
|
|
Selling, general and administrative(1) |
|
|
326 |
|
|
27 |
|
|
46 |
|
|
399 |
|
Acquisition and other related costs |
|
|
76 |
|
|
— |
|
— |
|
76 |
|
||
Depreciation and amortization |
|
|
125 |
|
|
13 |
|
|
110 |
|
|
248 |
|
|
|
|
1,437 |
|
|
71 |
|
|
304 |
|
|
1,812 |
|
Operating income (loss) |
|
|
307 |
|
|
(49 |
) |
|
(58 |
) |
|
200 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
|
(102 |
) |
|
(7 |
) |
|
(50 |
) |
|
(159 |
) |
Share of earnings (losses) of affiliates, net |
|
|
(4 |
) |
|
2 |
|
|
(18 |
) |
|
(20 |
) |
Realized and unrealized gains (losses) on financial instruments, net |
|
|
1 |
|
|
(2 |
) |
|
(97 |
) |
|
(98 |
) |
Unrealized gains (losses) on intergroup interests |
|
|
— |
|
(26 |
) |
|
26 |
|
|
— |
||
Other, net |
|
|
3 |
|
|
— |
|
5 |
|
|
8 |
|
|
|
|
|
(102 |
) |
|
(33 |
) |
|
(134 |
) |
|
(269 |
) |
Earnings (loss) from continuing operations before income taxes |
|
|
205 |
|
|
(82 |
) |
|
(192 |
) |
|
(69 |
) |
Income tax (expense) benefit |
|
|
(113 |
) |
|
11 |
|
|
44 |
|
|
(58 |
) |
Net earnings (loss) |
|
|
92 |
|
|
(71 |
) |
|
(148 |
) |
|
(127 |
) |
Less net earnings (loss) attributable to the noncontrolling interests |
|
|
31 |
|
|
— |
|
— |
|
31 |
|
||
Net earnings (loss) attributable to Liberty stockholders |
|
$ |
61 |
|
|
(71 |
) |
|
(148 |
) |
|
(158 |
) |
|
|
|
|
|
|
|
|
|
|
||||
(1) Includes stock-based compensation expense as follows: |
|
|
|
|
|
|
|
|
|
||||
Programming and content |
|
|
7 |
|
|
— |
|
— |
|
7 |
|
||
Customer service and billing |
|
|
1 |
|
|
— |
|
— |
|
1 |
|
||
Other |
|
|
1 |
|
|
— |
|
— |
|
1 |
|
||
Other operating expenses |
|
|
9 |
|
|
— |
|
— |
|
9 |
|
||
Selling, general and administrative |
|
|
37 |
|
|
3 |
|
|
7 |
|
|
47 |
|
Stock compensation expense |
|
$ |
55 |
|
|
3 |
|
|
7 |
|
|
65 |
|
STATEMENT OF CASH FLOWS INFORMATION
Three months ended |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
Attributed |
|
|
|||||||||
|
|
Liberty |
|
|
|
Formula |
|
|
|||||
|
|
|
|
|
|
One |
|
Consolidated |
|||||
|
|
Group |
|
Group |
|
Group |
|
Liberty |
|||||
|
|
amounts in millions |
|||||||||||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
||||
Net earnings (loss) |
|
$ |
292 |
|
|
53 |
|
|
(343 |
) |
|
2 |
|
Adjustments to reconcile net earnings to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
148 |
|
|
15 |
|
|
104 |
|
|
267 |
|
Stock-based compensation |
|
|
58 |
|
|
3 |
|
|
6 |
|
|
67 |
|
Share of (earnings) loss of affiliates, net |
|
|
2 |
|
|
(4 |
) |
|
64 |
|
|
62 |
|
Unrealized (gains) losses on intergroup interests, net |
|
|
(31 |
) |
|
(95 |
) |
|
126 |
|
|
— |
|
Realized and unrealized (gains) losses on financial instruments, net |
|
|
5 |
|
|
9 |
|
|
(15 |
) |
|
(1 |
) |
Deferred income tax expense (benefit) |
|
|
67 |
|
|
(13 |
) |
|
(15 |
) |
|
39 |
|
Intergroup tax allocation |
|
|
1 |
|
|
(2 |
) |
|
1 |
|
|
— |
|
Other charges (credits), net |
|
|
4 |
|
|
3 |
|
|
3 |
|
|
10 |
|
Changes in operating assets and liabilities |
|
|
|
|
|
|
|
|
|
||||
Current and other assets |
|
|
72 |
|
|
19 |
|
|
(125 |
) |
|
(34 |
) |
Payables and other liabilities |
|
|
(214 |
) |
|
29 |
|
|
330 |
|
|
145 |
|
Net cash provided (used) by operating activities |
|
|
404 |
|
|
17 |
|
|
136 |
|
|
557 |
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
||||
Investments in equity method affiliates and debt and equity securities |
|
|
(81 |
) |
|
— |
|
(1 |
) |
|
(82 |
) |
|
Return of investment in equity method affiliates |
|
|
— |
|
— |
|
105 |
|
|
105 |
|
||
Cash proceeds from sale of investments |
|
|
— |
|
— |
|
10 |
|
|
10 |
|
||
Capital expended for property and equipment, including internal-use software and website development |
|
|
(62 |
) |
|
(24 |
) |
|
(2 |
) |
|
(88 |
) |
Other investing activities, net |
|
|
(1 |
) |
|
— |
|
(2 |
) |
|
(3 |
) |
|
Net cash provided (used) by investing activities |
|
|
(144 |
) |
|
(24 |
) |
|
110 |
|
|
(58 |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
||||
Borrowings of debt |
|
|
204 |
|
|
174 |
|
|
475 |
|
|
853 |
|
Repayments of debt |
|
|
(206 |
) |
|
(35 |
) |
|
(131 |
) |
|
(372 |
) |
Liberty |
|
|
(69 |
) |
|
— |
|
(69 |
) |
|
(138 |
) |
|
Subsidiary shares repurchased by subsidiary |
|
|
(243 |
) |
|
— |
|
— |
|
(243 |
) |
||
Cash dividends paid by subsidiary |
|
|
(17 |
) |
|
— |
|
— |
|
(17 |
) |
||
Taxes paid in lieu of shares issued for stock-based compensation |
|
|
(36 |
) |
|
— |
|
(2 |
) |
|
(38 |
) |
|
Other financing activities, net |
|
|
(2 |
) |
|
(1 |
) |
|
(4 |
) |
|
(7 |
) |
Net cash provided (used) by financing activities |
|
|
(369 |
) |
|
138 |
|
|
269 |
|
|
38 |
|
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash |
|
|
— |
|
— |
|
(8 |
) |
|
(8 |
) |
||
Net increase (decrease) in cash, cash equivalents and restricted cash |
|
|
(109 |
) |
|
131 |
|
|
507 |
|
|
529 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
507 |
|
|
212 |
|
|
587 |
|
|
1,306 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
398 |
|
|
343 |
|
|
1,094 |
|
|
1,835 |
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
386 |
|
|
321 |
|
|
1,094 |
|
|
1,801 |
|
Restricted cash included in other current assets |
|
|
— |
|
9 |
|
|
— |
|
9 |
|
||
Restricted cash included in other assets |
|
|
12 |
|
|
13 |
|
|
— |
|
25 |
|
|
Total cash and cash equivalents and restricted cash at end of period |
|
$ |
398 |
|
|
343 |
|
|
1,094 |
|
|
1,835 |
|
STATEMENT OF CASH FLOWS INFORMATION
Three months ended |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
Attributed |
|
|
|||||||||
|
|
Liberty |
|
|
|
Formula |
|
|
|||||
|
|
|
|
|
|
One |
|
Consolidated |
|||||
|
|
Group |
|
Group |
|
Group |
|
Liberty |
|||||
|
|
amounts in millions |
|||||||||||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
||||
Net earnings (loss) |
|
$ |
92 |
|
|
(71 |
) |
|
(148 |
) |
|
(127 |
) |
Adjustments to reconcile net earnings to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
125 |
|
|
13 |
|
|
110 |
|
|
248 |
|
Stock-based compensation |
|
|
76 |
|
|
3 |
|
|
7 |
|
|
86 |
|
Share of (earnings) loss of affiliates, net |
|
|
4 |
|
|
(2 |
) |
|
18 |
|
|
20 |
|
Unrealized (gains) losses on intergroup interests, net |
|
|
— |
|
26 |
|
|
(26 |
) |
|
— |
||
Realized and unrealized (gains) losses on financial instruments, net |
|
|
(1 |
) |
|
2 |
|
|
97 |
|
|
98 |
|
Deferred income tax expense (benefit) |
|
|
109 |
|
|
2 |
|
|
(57 |
) |
|
54 |
|
Intergroup tax allocation |
|
|
1 |
|
|
(14 |
) |
|
13 |
|
|
— |
|
Other charges (credits), net |
|
|
3 |
|
|
1 |
|
|
1 |
|
|
5 |
|
Changes in operating assets and liabilities |
|
|
|
|
|
|
|
|
|
||||
Current and other assets |
|
|
(8 |
) |
|
23 |
|
|
(34 |
) |
|
(19 |
) |
Payables and other liabilities |
|
|
(19 |
) |
|
60 |
|
|
243 |
|
|
284 |
|
Net cash provided (used) by operating activities |
|
|
382 |
|
|
43 |
|
|
224 |
|
|
649 |
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
||||
Investments in equity affiliates and debt and equity securities |
|
|
(4 |
) |
|
(5 |
) |
|
(2 |
) |
|
(11 |
) |
Cash proceeds from the sale of investments |
|
|
72 |
|
|
— |
|
— |
|
72 |
|
||
Cash paid for acquisitions, net of cash acquired |
|
|
313 |
|
|
— |
|
— |
|
313 |
|
||
Capital expended for property and equipment, including internal-use software and website development |
|
|
(90 |
) |
|
(15 |
) |
|
(8 |
) |
|
(113 |
) |
Other investing activities, net |
|
|
(3 |
) |
|
(4 |
) |
|
— |
|
(7 |
) |
|
Net cash provided (used) by investing activities |
|
|
288 |
|
|
(24 |
) |
|
(10 |
) |
|
254 |
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
||||
Borrowings of debt |
|
|
913 |
|
|
— |
|
— |
|
913 |
|
||
Repayments of debt |
|
|
(725 |
) |
|
(14 |
) |
|
(2 |
) |
|
(741 |
) |
Liberty |
|
|
(222 |
) |
|
— |
|
— |
|
(222 |
) |
||
Subsidiary shares repurchased by subsidiary |
|
|
(576 |
) |
|
— |
|
— |
|
(576 |
) |
||
Cash dividends paid by subsidiary |
|
|
(19 |
) |
|
— |
|
— |
|
(19 |
) |
||
Taxes paid in lieu of shares issued for stock-based compensation |
|
|
(36 |
) |
|
— |
|
(4 |
) |
|
(40 |
) |
|
Other financing activities, net |
|
|
2 |
|
|
(5 |
) |
|
3 |
|
|
— |
|
Net cash provided (used) by financing activities |
|
|
(663 |
) |
|
(19 |
) |
|
(3 |
) |
|
(685 |
) |
Effect of foreign exchange rates on cash, cash equivalents and restricted cash |
|
|
— |
|
— |
|
1 |
|
|
1 |
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash |
|
|
7 |
|
|
— |
|
212 |
|
|
219 |
|
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
102 |
|
|
190 |
|
|
160 |
|
|
452 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
109 |
|
|
190 |
|
|
372 |
|
|
671 |
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
98 |
|
|
163 |
|
|
372 |
|
|
633 |
|
Restricted cash included in other current assets |
|
|
— |
|
14 |
|
|
— |
|
14 |
|
||
Restricted cash included in other assets |
|
|
11 |
|
|
13 |
|
|
— |
|
24 |
|
|
Total cash and cash equivalents and restricted cash at end of period |
|
$ |
109 |
|
|
190 |
|
|
372 |
|
|
671 |
|
NON-GAAP FINANCIAL MEASURES
SCHEDULE 1
To provide investors with additional information regarding our financial results, this press release includes a presentation of Adjusted OIBDA, which is a non-GAAP financial measure, for the
The following table provides a reconciliation of Adjusted OIBDA for
QUARTERLY SUMMARY
(amounts in millions) |
|
1Q19 |
|
1Q20 |
||||
|
|
|
|
|
|
|
||
Revenue |
|
$ |
1,744 |
|
|
$ |
1,952 |
|
|
|
|
|
|
|
|
||
Operating Income |
|
$ |
307 |
|
|
$ |
442 |
|
Depreciation and amortization |
|
|
125 |
|
|
|
148 |
|
Legal settlements and reserves |
|
|
25 |
|
|
|
(16 |
) |
Acquisition and other related costs |
|
|
76 |
|
|
|
— |
|
Stock compensation expense |
|
|
55 |
|
|
|
58 |
|
Adjusted OIBDA |
|
$ |
588 |
|
|
$ |
632 |
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Revenue |
|
$ |
246 |
|
|
$ |
39 |
|
|
|
|
|
|
|
|
||
Operating Income |
|
$ |
(58 |
) |
|
$ |
(152 |
) |
Depreciation and amortization |
|
|
110 |
|
|
|
104 |
|
Stock compensation expense |
|
|
7 |
|
|
|
6 |
|
Adjusted OIBDA |
|
$ |
59 |
|
|
$ |
(42 |
) |
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Revenue |
|
$ |
22 |
|
|
$ |
22 |
|
|
|
|
|
|
|
|
||
Operating Income |
|
$ |
(49 |
) |
|
$ |
(44 |
) |
Depreciation and amortization |
|
|
13 |
|
|
|
15 |
|
Stock compensation expense |
|
|
3 |
|
|
|
3 |
|
Adjusted OIBDA |
|
$ |
(33 |
) |
|
$ |
(26 |
) |
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Revenue |
|
$ |
2,012 |
|
|
$ |
2,013 |
|
|
|
|
|
|
|
|
||
Operating Income |
|
$ |
200 |
|
|
$ |
246 |
|
Depreciation and amortization |
|
|
248 |
|
|
|
267 |
|
Legal settlements and reserves |
|
|
25 |
|
|
|
(16 |
) |
Acquisition and other related costs |
|
|
76 |
|
|
|
— |
|
Stock compensation expense |
|
|
65 |
|
|
|
67 |
|
Adjusted OIBDA |
|
$ |
614 |
|
|
$ |
564 |
|
|
|
|
|
|
|
|
SCHEDULE 2
This press release also includes a presentation of adjusted EBITDA of
Adjusted EBITDA has certain limitations in that it does not take into account the impact to SiriusXM’s statements of comprehensive income of certain expenses, including share-based payment expense and certain purchase price accounting for the XM Merger and the Pandora Acquisition.
|
|
Unaudited |
|||||||
|
|
For the Three Months Ended |
|||||||
|
|
|
|||||||
|
|
2019 |
|
2020 |
|||||
($ in millions) |
|
|
|
|
|
|
|
||
Net income: |
|
$ |
162 |
|
|
$ |
293 |
|
|
Add back items excluded from Adjusted EBITDA: |
|
|
|
|
|
|
|
||
Legal settlements and reserves |
|
|
25 |
|
|
|
(16 |
) |
|
Acquisition and other related costs(1) |
|
|
76 |
|
|
|
— |
|
|
Share-based payment expense |
|
|
49 |
|
|
|
55 |
|
|
Depreciation and amortization |
|
|
107 |
|
|
|
132 |
|
|
Interest expense |
|
|
90 |
|
|
|
99 |
|
|
Loss on extinguishment of debt |
|
|
1 |
|
|
|
— |
|
|
Other expense (income) |
|
|
(1 |
) |
|
|
(4 |
) |
|
Income tax expense |
|
|
81 |
|
|
|
80 |
|
|
Purchase price accounting adjustments: |
|
|
|
|
|
|
|
||
Revenues |
|
|
2 |
|
|
|
2 |
|
|
Operating expenses |
|
|
(1 |
) |
|
|
(2 |
) |
|
Pro forma adjustments(2) |
|
|
(24 |
) |
|
|
— |
|
|
Adjusted EBITDA |
|
$ |
567 |
|
|
$ |
639 |
|
|
(1) |
Acquisition and other related costs include |
|
(2) |
Pro forma adjustment for three months ended |
View source version on businesswire.com: https://www.businesswire.com/news/home/20200507005351/en/
Source: