Viacom Reports Fourth Quarter and Full Year Financial Results
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Fiscal Year 2016 Results |
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(in millions, except per share amounts) |
Quarter Ended |
B/(W) |
Year Ended |
B/(W) | |||||||||||||||||||
2016 | 2015 |
2016 vs. |
2016 | 2015 |
2016 vs. |
||||||||||||||||||
GAAP |
|||||||||||||||||||||||
Revenues | $ | 3,226 | $ | 3,788 | (15 | )% | $ | 12,488 | $ | 13,268 | (6 | )% | |||||||||||
Operating income | 332 | 1,055 | (69 | ) | 2,526 | 3,112 | (19 | ) | |||||||||||||||
Net earnings from continuing operations attributable to |
252 | 884 | (71 | ) | 1,436 | 1,922 | (25 | ) | |||||||||||||||
Diluted EPS from continuing operations | 0.63 | 2.21 | (71 | ) | 3.61 | 4.73 | (24 | ) | |||||||||||||||
Non-GAAP* |
|||||||||||||||||||||||
Adjusted operating income | $ | 538 | $ | 1,055 | (49 | )% | $ | 2,732 | $ | 3,920 | (30 | )% | |||||||||||
Adjusted net earnings from continuing operations attributable to
|
273 | 614 | (56 | ) | 1,465 | 2,210 | (34 | ) | |||||||||||||||
Adjusted diluted EPS from continuing operations | 0.69 | 1.54 | (55 | ) | 3.68 | 5.44 | (32 | ) | |||||||||||||||
* Non-GAAP measures referenced in this release are detailed in the Supplemental Disclosures at the end of this release.
Revenues |
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(in millions) |
Quarter Ended |
B/(W) |
Year Ended |
B/(W) | |||||||||||||||||||
2016 | 2015 |
2016 vs. |
2016 | 2015 |
2016 vs. |
||||||||||||||||||
Media Networks | $ | 2,483 | $ | 2,787 | (11 | )% | $ | 9,942 | $ | 10,490 | (5 | )% | |||||||||||
|
774 | 1,025 | (24 | ) | 2,662 | 2,883 | (8 | ) | |||||||||||||||
Eliminations | (31 | ) | (24 | ) | NM | (116 | ) | (105 | ) | NM | |||||||||||||
Total Revenues | $ | 3,226 | $ | 3,788 | (15 | )% | $ | 12,488 | $ | 13,268 | (6 | )% | |||||||||||
NM - Not Meaningful |
Quarterly revenues declined 15% to
Full-year revenues were
Operating Income/(Loss) |
|||||||||||||||||||||||
(in millions) |
Quarter Ended |
B/(W) |
Year Ended |
B/(W) | |||||||||||||||||||
2016 | 2015 |
2016 vs. |
2016 | 2015 |
2016 vs. |
||||||||||||||||||
Media Networks | $ | 750 | $ | 1,022 | (27 | )% | $ | 3,484 | $ | 4,143 | (16 | )% | |||||||||||
|
(137 | ) | 122 | NM | (445 | ) | 111 | NM | |||||||||||||||
Corporate expenses | (50 | ) | (59 | ) | 15 | (213 | ) | (235 | ) | 9 | |||||||||||||
Eliminations | (1 | ) | (1 | ) | NM | 1 | 2 | NM | |||||||||||||||
Equity-based compensation | (24 | ) | (29 | ) | 17 | (95 | ) | (101 | ) | 6 | |||||||||||||
Adjusted operating income (Non-GAAP) | 538 | 1,055 | (49 | ) | 2,732 | 3,920 | (30 | ) | |||||||||||||||
Restructuring and programming charges | (206 | ) | — | NM | (206 | ) | (784 | ) | 74 | ||||||||||||||
Loss on pension settlement | — | — | — | — | (24 | ) | NM | ||||||||||||||||
Operating income (GAAP) | $ | 332 | $ | 1,055 | (69 | )% | $ | 2,526 | $ | 3,112 | (19 | )% | |||||||||||
NM - Not Meaningful |
Quarterly operating income was
Full-year operating income declined to
Quarterly net earnings from continuing operations attributable to
Full-year net earnings from continuing operations attributable to
Debt
At
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For more information about
Cautionary Statement Concerning Forward-Looking Statements
This news release contains both historical and forward-looking
statements. All statements that are not statements of historical fact
are, or may be deemed to be, forward-looking statements. Forward-looking
statements reflect our current expectations concerning future results,
objectives, plans and goals, and involve known and unknown risks,
uncertainties and other factors that are difficult to predict and which
may cause future results, performance or achievements to differ. These
risks, uncertainties and other factors include, among others: the effect
of uncertainty stemming from ongoing transitions involving our board of
directors and management and related changes in strategy, including a
potential business combination with CBS Corporation; the public
acceptance of our brands, programs, motion pictures and other
entertainment content on the various platforms on which they are
distributed; the impact of inadequate audience measurement on our
program ratings and advertising and affiliate revenues; technological
developments and their effect in our markets and on consumer behavior;
competition for content, audiences, advertising and distribution; the
impact of piracy; economic fluctuations in advertising and retail
markets, and economic conditions generally; fluctuations in our results
due to the timing, mix, number and availability of our motion pictures
and other programming; the potential for loss of carriage or other
reduction in the distribution of our content; changes in the Federal
communications or other laws and regulations; evolving cybersecurity and
similar risks; other domestic and global economic, business, competitive
and/or regulatory factors affecting our businesses generally; and other
factors described in our news releases and filings with the
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) |
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Quarter Ended |
Year Ended |
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(in millions, except per share amounts) | 2016 | 2015 | 2016 | 2015 | |||||||||||||
Revenues | $ | 3,226 | $ | 3,788 | $ | 12,488 | $ | 13,268 | |||||||||
Expenses: | |||||||||||||||||
Operating | 1,862 | 1,937 | 6,684 | 6,868 | |||||||||||||
Selling, general and administrative | 771 | 742 | 2,851 | 2,860 | |||||||||||||
Depreciation and amortization | 55 | 54 | 221 | 222 | |||||||||||||
Restructuring | 206 | — | 206 | 206 | |||||||||||||
Total expenses | 2,894 | 2,733 | 9,962 | 10,156 | |||||||||||||
Operating income | 332 | 1,055 | 2,526 | 3,112 | |||||||||||||
Interest expense, net | (150 | ) | (165 | ) | (616 | ) | (657 | ) | |||||||||
Equity in net earnings of investee companies | 2 | (1 | ) | 87 | 102 | ||||||||||||
Loss on extinguishment of debt | — | (18 | ) | — | (18 | ) | |||||||||||
Other items, net | (6 | ) | (6 | ) | (7 | ) | (36 | ) | |||||||||
Earnings from continuing operations before provision for income taxes | 178 | 865 | 1,990 | 2,503 | |||||||||||||
Provision for income taxes | 83 | 27 | (519 | ) | (501 | ) | |||||||||||
Net earnings from continuing operations | 261 | 892 | 1,471 | 2,002 | |||||||||||||
Discontinued operations, net of tax | 2 | — | 2 | — | |||||||||||||
Net earnings ( |
263 | 892 | 1,473 | 2,002 | |||||||||||||
Net earnings attributable to noncontrolling interests | (9 | ) | (8 | ) | (35 | ) | (80 | ) | |||||||||
Net earnings attributable to |
$ | 254 | $ | 884 | $ | 1,438 | $ | 1,922 | |||||||||
Amounts attributable to |
|||||||||||||||||
Net earnings from continuing operations | $ | 252 | $ | 884 | $ | 1,436 | $ | 1,922 | |||||||||
Discontinued operations, net of tax | 2 | — | 2 | — | |||||||||||||
Net earnings attributable to |
$ | 254 | $ | 884 | $ | 1,438 | $ | 1,922 | |||||||||
Basic earnings per share attributable to |
|||||||||||||||||
Continuing operations | $ | 0.63 | $ | 2.22 | $ | 3.62 | $ | 4.78 | |||||||||
Discontinued operations | 0.01 | — | 0.01 | — | |||||||||||||
Net earnings | $ | 0.64 | $ | 2.22 | $ | 3.63 | $ | 4.78 | |||||||||
Diluted earnings per share attributable to |
|||||||||||||||||
Continuing operations | $ | 0.63 | $ | 2.21 | $ | 3.61 | $ | 4.73 | |||||||||
Discontinued operations | 0.01 | — | — | — | |||||||||||||
Net earnings | $ | 0.64 | $ | 2.21 | $ | 3.61 | $ | 4.73 | |||||||||
Weighted average number of common shares outstanding: | |||||||||||||||||
Basic | 396.9 | 398.0 | 396.5 | 402.2 | |||||||||||||
Diluted | 398.3 | 399.9 | 398.0 | 406.0 | |||||||||||||
Dividends declared per share of Class A and Class B common stock | $ | 0.20 | $ | 0.40 | $ | 1.40 | $ | 1.46 | |||||||||
CONSOLIDATED BALANCE SHEETS (Unaudited) |
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(in millions, except par value) |
|
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2016 | 2015 | ||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 379 | $ | 506 | |||||
Receivables, net | 2,712 | 2,807 | |||||||
Inventory, net | 844 | 786 | |||||||
Prepaid and other assets | 587 | 479 | |||||||
Total current assets | 4,522 | 4,578 | |||||||
Property and equipment, net | 932 | 947 | |||||||
Inventory, net | 4,032 | 3,616 | |||||||
|
11,400 | 11,456 | |||||||
Intangibles, net | 315 | 340 | |||||||
Other assets | 1,307 | 1,206 | |||||||
Total assets | $ | 22,508 | $ | 22,143 | |||||
LIABILITIES AND EQUITY | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 453 | $ | 506 | |||||
Accrued expenses | 773 | 748 | |||||||
Participants' share and residuals | 801 | 860 | |||||||
Program obligations | 692 | 703 | |||||||
Deferred revenue | 419 | 481 | |||||||
Current portion of debt | 17 | 18 | |||||||
Other liabilities | 517 | 537 | |||||||
Total current liabilities | 3,672 | 3,853 | |||||||
Noncurrent portion of debt | 11,896 | 12,267 | |||||||
Participants' share and residuals | 358 | 351 | |||||||
Program obligations | 311 | 356 | |||||||
Deferred tax liabilities, net | 381 | 150 | |||||||
Other liabilities | 1,349 | 1,348 | |||||||
Redeemable noncontrolling interest | 211 | 219 | |||||||
Commitments and contingencies | |||||||||
|
|||||||||
Class A common stock, par value |
— | — | |||||||
Class B common stock, par value |
— | — | |||||||
Additional paid-in capital | 10,139 | 10,017 | |||||||
|
(20,798 | ) | (20,725 | ) | |||||
Retained earnings | 15,628 | 14,780 | |||||||
Accumulated other comprehensive loss | (692 | ) | (534 | ) | |||||
Total |
4,277 | 3,538 | |||||||
Noncontrolling interests | 53 | 61 | |||||||
Total equity | 4,330 | 3,599 | |||||||
Total liabilities and equity | $ | 22,508 | $ | 22,143 | |||||
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
The following tables reconcile our results for the quarter and year
ended
(in millions, except per share amounts) | |||||||||||||||||||||
Quarter Ended |
|||||||||||||||||||||
Operating |
Earnings from |
Provision for |
Net Earnings |
Diluted EPS |
|||||||||||||||||
Reported results (GAAP) | $ | 332 | $ | 178 | $ | (83 | ) | $ | 252 | $ | 0.63 | ||||||||||
Factors Affecting Comparability: | |||||||||||||||||||||
Restructuring (2) | 206 | 206 | 75 | 131 | 0.33 | ||||||||||||||||
Discrete tax benefit (3) | — | — | 110 | (110 | ) | (0.27 | ) | ||||||||||||||
Adjusted results (Non-GAAP) | $ | 538 | $ | 384 | $ | 102 | $ | 273 | $ | 0.69 | |||||||||||
Year Ended |
|||||||||||||||||||||
Operating Income |
Earnings from |
Provision for |
Net Earnings |
Diluted EPS from Continuing Operations |
|||||||||||||||||
Reported results (GAAP) | $ | 2,526 | $ | 1,990 | $ | 519 | $ | 1,436 | $ | 3.61 | |||||||||||
Factors Affecting Comparability: | |||||||||||||||||||||
Restructuring (2) | 206 | 206 | 75 | 131 | 0.33 | ||||||||||||||||
Discrete tax benefit (3) | — | — | 102 | (102 | ) | (0.26 | ) | ||||||||||||||
Adjusted results (Non-GAAP) | $ | 2,732 | $ | 2,196 | $ | 696 | $ | 1,465 | $ | 3.68 | |||||||||||
Quarter Ended |
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Operating Income |
Earnings from |
Provision for |
Net Earnings |
Diluted EPS |
|||||||||||||||||
Reported results (GAAP) | $ | 1,055 | $ | 865 | $ | (27 | ) | $ | 884 | $ | 2.21 | ||||||||||
Factors Affecting Comparability: | |||||||||||||||||||||
Loss on extinguishment of debt (4) | — | 18 | 7 | 11 | 0.03 | ||||||||||||||||
Discrete tax benefit (5) | — | — | 281 | (281 | ) | (0.70 | ) | ||||||||||||||
Adjusted results (Non-GAAP) | $ | 1,055 | $ | 883 | $ | 261 | $ | 614 | $ | 1.54 | |||||||||||
Year Ended |
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Operating |
Earnings from |
Provision for Income Taxes (1) |
Net Earnings |
Diluted EPS |
|||||||||||||||||
Reported results (GAAP) | $ | 3,112 | $ | 2,503 | $ | 501 | $ | 1,922 | $ | 4.73 | |||||||||||
Factors Affecting Comparability: | |||||||||||||||||||||
Restructuring and programming charges (6) | 784 | 784 | 264 | 520 | 1.28 | ||||||||||||||||
Loss on pension settlement (7) | 24 | 24 | 9 | 15 | 0.04 | ||||||||||||||||
Loss on extinguishment of debt (4) | — | 18 | 7 | 11 | 0.03 | ||||||||||||||||
Discrete tax benefit (5) | — | — | 258 | (258 | ) | (0.64 | ) | ||||||||||||||
Adjusted results (Non-GAAP) | $ | 3,920 | $ | 3,329 | $ | 1,039 | $ | 2,210 | $ | 5.44 | |||||||||||
(1) The tax impact has been calculated by applying the tax rates applicable to the adjustments presented.
(2) The pre-tax charge of
(3) The net discrete tax benefit in the quarter and year is principally
related to a tax accounting method change granted by the
(4) The pre-tax charge of
(5) The net discrete tax benefit in the quarter and year was principally
related to excess foreign tax credits attributable to a taxable
repatriation of non-
(6) The pre-tax charge of
(7) The pre-tax non-cash charge of
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