Quarterly report pursuant to Section 13 or 15(d)

Guarantor/Non-Guarantor Subsidiary Financial Information (Tables)

v2.4.0.8
Guarantor/Non-Guarantor Subsidiary Financial Information (Tables)
6 Months Ended
Jun. 30, 2014
Guarantor Non-guarantor Subsidiary Financial Information [Abstract]  
Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Current Year
Condensed consolidating balance sheets
June 30, 2014
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Assets
Current assets:





Cash and cash equivalents
$
18

162

368


548

Restricted cash
11


3


14

Accounts receivable, net
490


266


756

Inventories
725


264


989

Deferred income taxes
147


18


165

Prepaid expenses
28


29


57

Total current assets
1,419

162

948


2,529

Property and equipment, net
253

66

757


1,076

Cable and satellite television distribution rights, net

441

99


540

Goodwill
4,169


1,041


5,210

Other intangible assets, net
1,092

2,049

102


3,243

Other noncurrent assets
9


60


69

Investments in subsidiaries
4,893

1,601


(6,494
)

Total assets
$
11,835

4,319

3,007

(6,494
)
12,667

Liabilities and equity
Current liabilities:





Current portion of debt and capital lease obligations
$
2


9


11

Accounts payable-trade
275


195


470

Accrued liabilities
150

86

507


743

Intercompany accounts payable (receivable)
1,084

(814
)
(270
)


Total current liabilities
1,511

(728
)
441


1,224

Long-term portion of debt and capital lease obligations
3,886


51


3,937

Deferred compensation
14




14

Deferred income taxes
319

901

3


1,223

Other long-term liabilities
109


48


157

Total liabilities
5,839

173

543


6,555

Equity:





QVC, Inc. stockholder's equity
5,996

4,146

2,348

(6,494
)
5,996

Noncontrolling interest


116


116

Total equity
5,996

4,146

2,464

(6,494
)
6,112

Total liabilities and equity
$
11,835

4,319

3,007

(6,494
)
12,667

Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Prior Year
Condensed consolidating balance sheets
December 31, 2013
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Assets
Current assets:





Cash and cash equivalents
$
78

133

246


457

Restricted cash
11


3


14

Accounts receivable, net
816


295


1,111

Inventories
684


247


931

Deferred income taxes
146


16


162

Prepaid expenses
20


27


47

Total current assets
1,755

133

834


2,722

Property and equipment, net
265

67

774


1,106

Cable and satellite television distribution rights, net

510

114


624

Goodwill
4,169


1,028


5,197

Other intangible assets, net
1,128

2,050

158


3,336

Other noncurrent assets
8


63


71

Investments in subsidiaries
4,894

1,628


(6,522
)

Total assets
$
12,219

4,388

2,971

(6,522
)
13,056

Liabilities and equity
Current liabilities:





Current portion of debt and capital lease obligations
$
2


11


13

Accounts payable-trade
336


158


494

Accrued liabilities
393

96

471


960

Intercompany accounts payable (receivable)
1,019

(879
)
(140
)


Total current liabilities
1,750

(783
)
500


1,467

Long-term portion of debt and capital lease obligations
3,745


55


3,800

Deferred compensation
13


1


14

Deferred income taxes
399

923

4


1,326

Other long-term liabilities
90


18


108

Total liabilities
5,997

140

578


6,715

Equity:





QVC, Inc. stockholder's equity
6,222

4,248

2,274

(6,522
)
6,222

Noncontrolling interest


119


119

Total equity
6,222

4,248

2,393

(6,522
)
6,341

Total liabilities and equity
$
12,219

4,388

2,971

(6,522
)
13,056

Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Prior Year
Condensed consolidating statements of operations - Adjusted
Three months ended June 30, 2013
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net revenue
$
1,326

182

681

(228
)
1,961

Cost of goods sold
836

23

427

(59
)
1,227

Gross profit
490

159

254

(169
)
734

Operating expenses:





Operating
38

48

85


171

Selling, general and administrative, including stock-based compensation
227


80

(169
)
138

Depreciation
9

2

22


33

Amortization
51

36

20


107

Intercompany management expense (income)
15

(4
)
(11
)



340

82

196

(169
)
449

Operating income
150

77

58


285

Other (expense) income:





Equity in losses of investee


(2
)

(2
)
Gains on financial instruments


3


3

Interest (expense) income, net
(50
)
(1
)
1


(50
)
Foreign currency (loss) gain
(1
)

1



Loss on extinguishment of debt
(16
)



(16
)
Intercompany interest and other (expense) income
(4
)
12

(8
)



(71
)
11

(5
)

(65
)
Income before income taxes
79

88

53


220

Income tax expense
(21
)
(32
)
(28
)

(81
)
Equity in earnings of subsidiaries, net of tax
81

11


(92
)

Net income
139

67

25

(92
)
139

Less net income attributable to the noncontrolling interest
(13
)

(13
)
13

(13
)
Net income attributable to QVC, Inc. stockholder
$
126

67

12

(79
)
126

Condensed consolidating statements of operations - Adjusted
Six months ended June 30, 2013
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net revenue
$
2,640

365

1,389

(459
)
3,935

Cost of goods sold
1,679

49

871

(120
)
2,479

Gross profit
961

316

518

(339
)
1,456

Operating expenses:





Operating
75

93

176


344

Selling, general and administrative, including stock-based compensation
463


169

(339
)
293

Depreciation
19

3

41


63

Amortization
102

70

39


211

Intercompany management expense (income)
32

(7
)
(25
)



691

159

400

(339
)
911

Operating income
270

157

118


545

Other (expense) income:





Equity in losses of investee


(1
)

(1
)
Gains on financial instruments
12


3


15

Interest expense, net
(112
)
(1
)


(113
)
Foreign currency (loss) gain
(2
)
(1
)
2


(1
)
Loss on extinguishment of debt
(57
)



(57
)
Intercompany interest and other (expense) income
(7
)
25

(18
)



(166
)
23

(14
)

(157
)
Income before income taxes
104

180

104


388

Income tax expense
(32
)
(60
)
(51
)

(143
)
Equity in earnings of subsidiaries, net of tax
173

26


(199
)

Net income
245

146

53

(199
)
245

Less net income attributable to the noncontrolling interest
(25
)

(25
)
25

(25
)
Net income attributable to QVC, Inc. stockholder
$
220

146

28

(174
)
220

Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Current Year
Condensed consolidating statements of operations
Six months ended June 30, 2014
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net revenue
$
2,692

364

1,399

(455
)
4,000

Cost of goods sold
1,692

48

878

(112
)
2,506

Gross profit
1,000

316

521

(343
)
1,494

Operating expenses:





Operating
82

95

181


358

Selling, general and administrative, including stock-based compensation
466

(1
)
181

(343
)
303

Depreciation
19

3

44


66

Amortization
110

77

36


223

Intercompany management expense (income)
40

(8
)
(32
)



717

166

410

(343
)
950

Operating income
283

150

111


544

Other (expense) income:





Equity in losses of investee


(3
)

(3
)
Interest expense, net
(113
)

(9
)

(122
)
Foreign currency (loss) gain
(3
)

3



Intercompany interest and other (expense) income
(10
)
26

4

(20
)


(126
)
26

(5
)
(20
)
(125
)
Income before income taxes
157

176

106

(20
)
419

Income tax expense
(7
)
(52
)
(98
)

(157
)
Equity in earnings (losses) of subsidiaries, net of tax
112

(19
)

(93
)

Net income
262

105

8

(113
)
262

Less net income attributable to the noncontrolling interest
(19
)

(19
)
19

(19
)
Net income (loss) attributable to QVC, Inc. stockholder
$
243

105

(11
)
(94
)
243

Condensed consolidating statements of operations
Three months ended June 30, 2014
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net revenue
$
1,368

187

692

(233
)
2,014

Cost of goods sold
850

23

432

(55
)
1,250

Gross profit
518

164

260

(178
)
764

Operating expenses:





Operating
42

49

89


180

Selling, general and administrative, including stock-based compensation
243

1

89

(178
)
155

Depreciation
10

1

22


33

Amortization
58

38

16


112

Intercompany management expense (income)
20

(5
)
(15
)



373

84

201

(178
)
480

Operating income
145

80

59


284

Other (expense) income:





Equity in losses of investee


(2
)

(2
)
Interest expense, net
(60
)



(60
)
Foreign currency (loss) gain
(1
)

2


1

Intercompany interest and other (expense) income
(5
)
13

12

(20
)


(66
)
13

12

(20
)
(61
)
Income before income taxes
79

93

71

(20
)
223

Income tax expense
(27
)
(28
)
(28
)

(83
)
Equity in earnings of subsidiaries, net of tax
88

29


(117
)

Net income
140

94

43

(137
)
140

Less net income attributable to the noncontrolling interest
(10
)

(10
)
10

(10
)
Net income attributable to QVC, Inc. stockholder
$
130

94

33

(127
)
130

Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Prior Year
Three months ended June 30, 2013
 
(in millions)
Subsidiary
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net income
$
139

67

25

(92
)
139

Foreign currency translation adjustments
(16
)

(16
)
16

(16
)
Total comprehensive income
123

67

9

(76
)
123

Comprehensive income attributable to noncontrolling interest
(7
)

(7
)
7

(7
)
Comprehensive income attributable to QVC, Inc. stockholder
$
116

67

2

(69
)
116

Condensed consolidating statements of comprehensive income - Adjusted
Six months ended June 30, 2013
 
(in millions)
Subsidiary
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net income
$
245

146

53

(199
)
245

Foreign currency translation adjustments
(107
)

(107
)
107

(107
)
Total comprehensive income (loss)
138

146

(54
)
(92
)
138

Comprehensive income attributable to noncontrolling interest
(6
)

(6
)
6

(6
)
Comprehensive income (loss) attributable to QVC, Inc. stockholder
$
132

146

(60
)
(86
)
132

Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Current Year
Condensed consolidating statements of comprehensive income
Three months ended June 30, 2014
 
(in millions)
Subsidiary
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net income
$
140

94

43

(137
)
140

Foreign currency translation adjustments
2


2

(2
)
2

Total comprehensive income
142

94

45

(139
)
142

Comprehensive income attributable to noncontrolling interest
(10
)

(10
)
10

(10
)
Comprehensive income attributable to QVC, Inc. stockholder
$
132

94

35

(129
)
132

Condensed consolidating statements of comprehensive income
Six months ended June 30, 2014
 
(in millions)
Subsidiary
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net income
$
262

105

8

(113
)
262

Foreign currency translation adjustments
18


18

(18
)
18

Total comprehensive income
280

105

26

(131
)
280

Comprehensive income attributable to noncontrolling interest
(22
)

(22
)
22

(22
)
Comprehensive income attributable to QVC, Inc. stockholder
$
258

105

4

(109
)
258

Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Current Year
Condensed consolidating statements of cash flows
Six months ended June 30, 2014
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Operating activities:










Net cash provided by operating activities
$
217

172

160


549

Investing activities:










Capital expenditures, net
(74
)
(1
)
38

(20
)
(57
)
Expenditures for cable and satellite television distribution rights, net

(8
)


(8
)
Intercompany investing activities
114

27


(141
)

Net cash provided by (used in) investing activities
40

18

38

(161
)
(65
)
Financing activities:










Principal payments of debt and capital lease obligations
(1,414
)

(5
)

(1,419
)
Principal borrowings of debt from senior secured credit facility
554




554

Proceeds from issuance of senior secured notes, net of original issue discount
999




999

Payment of debt origination fees
(12
)



(12
)
Other financing activities
(4
)



(4
)
Dividends paid to Liberty
(480
)



(480
)
Dividends paid to noncontrolling interest


(25
)

(25
)
Net short-term intercompany debt borrowings (repayments)
65

65

(130
)


Intercompany financing activities
(25
)
(226
)
90

161


Net cash used in financing activities
(317
)
(161
)
(70
)
161

(387
)
Effect of foreign exchange rate changes on cash and cash equivalents


(6
)

(6
)
Net (decrease) increase in cash and cash equivalents
(60
)
29

122


91

Cash and cash equivalents, beginning of period
78

133

246


457

Cash and cash equivalents, end of period
$
18

162

368


548

Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Prior Year
Condensed consolidating statements of cash flows - Adjusted
Six months ended June 30, 2013
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Operating activities:





Net cash provided by operating activities
$
275

115

52


442

Investing activities:





Capital expenditures, net
(33
)

(42
)

(75
)
Expenditures for cable and satellite television distribution rights, net

(25
)
(1
)

(26
)
Changes in other noncurrent assets
4


(3
)

1

Intercompany investing activities
258

149


(407
)

Net cash provided by (used in) investing activities
229

124

(46
)
(407
)
(100
)
Financing activities:










Principal payments of debt and capital lease obligations
(1,690
)

(5
)

(1,695
)
Principal borrowings of debt from senior secured credit facility
1,053




1,053

Proceeds from issuance of senior secured notes, net of original issue discount
1,050




1,050

Payment of debt origination fees
(16
)



(16
)
Payment of bond premium fees
(46
)



(46
)
Other financing activities
7




7

Dividends paid to Liberty
(765
)



(765
)
Dividends paid to noncontrolling interest


(25
)

(25
)
Net short-term intercompany debt (repayments) borrowings
(21
)
86

(65
)


Intercompany financing activities
(143
)
(326
)
62

407


Net cash used in financing activities
(571
)
(240
)
(33
)
407

(437
)
Effect of foreign exchange rate changes on cash and cash equivalents


(29
)

(29
)
Net decrease in cash and cash equivalents
(67
)
(1
)
(56
)

(124
)
Cash and cash equivalents, beginning of period
75

165

300


540

Cash and cash equivalents, end of period
$
8

164

244


416