Quarterly report pursuant to Section 13 or 15(d)

Guarantor/Non-Guarantor Subsidiary Financial Information (Tables)

v3.2.0.727
Guarantor/Non-Guarantor Subsidiary Financial Information (Tables)
6 Months Ended
Jun. 30, 2015
Guarantor Non-guarantor Subsidiary Financial Information [Abstract]  
Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Current Period
Condensed Consolidating Balance Sheets
June 30, 2015
 
(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
$
52

183

210


445

Restricted cash
10


2


12

Accounts receivable, net
558


241


799

Inventories
727


237


964

Deferred income taxes
175


35


210

Prepaid expenses
26


31


57

Total current assets
1,548

183

756


2,487

Property and equipment, net
275

68

639


982

Cable and satellite television distribution rights, net

354

55


409

Goodwill
4,191


858


5,049

Other intangible assets, net
935

2,051

51


3,037

Other noncurrent assets
6


55


61

Investments in subsidiaries
3,695

1,129

1,354

(6,178
)

Total assets
$
10,650

3,785

3,768

(6,178
)
12,025

Liabilities and equity
Current liabilities:





Current portion of debt and capital lease obligations
$
3


6


9

Accounts payable-trade
336


230


566

Accrued liabilities
138

145

406


689

Intercompany accounts payable (receivable)
437

1,341

(1,778
)


Total current liabilities
914

1,486

(1,136
)

1,264

Long-term portion of debt and capital lease obligations
4,456


51


4,507

Deferred compensation
13




13

Deferred income taxes
259

857

(37
)

1,079

Other long-term liabilities
113


57


170

Total liabilities
5,755

2,343

(1,065
)

7,033

Equity:





QVC, Inc. stockholder's equity
4,895

1,442

4,736

(6,178
)
4,895

Noncontrolling interest


97


97

Total equity
4,895

1,442

4,833

(6,178
)
4,992

Total liabilities and equity
$
10,650

3,785

3,768

(6,178
)
12,025

Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Prior Period
Condensed Consolidating Balance Sheets
December 31, 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
$
2

123

222


347

Restricted cash
10


2


12

Accounts receivable, net
909


287


1,196

Inventories
680


202


882

Deferred income taxes
192


18


210

Prepaid expenses
25


25


50

Total current assets
1,818

123

756


2,697

Property and equipment, net
273

68

685


1,026

Cable and satellite television distribution rights, net

388

73


461

Goodwill
4,184


907


5,091

Other intangible assets, net
1,023

2,051

69


3,143

Other noncurrent assets
1


57


58

Investments in subsidiaries
4,681

1,386


(6,067
)

Total assets
$
11,980

4,016

2,547

(6,067
)
12,476

Liabilities and equity
Current liabilities:





Current portion of debt and capital lease obligations
$
2


7


9

Accounts payable-trade
420


209


629

Accrued liabilities
282

143

460


885

Intercompany accounts payable (receivable)
1,384

(921
)
(463
)


Total current liabilities
2,088

(778
)
213


1,523

Long-term portion of debt and capital lease obligations
4,565


55


4,620

Deferred compensation
16


1


17

Deferred income taxes
269

877

(25
)

1,121

Other long-term liabilities
99


50


149

Total liabilities
7,037

99

294


7,430

Equity:





QVC, Inc. stockholder's equity
4,943

3,917

2,150

(6,067
)
4,943

Noncontrolling interest


103


103

Total equity
4,943

3,917

2,253

(6,067
)
5,046

Total liabilities and equity
$
11,980

4,016

2,547

(6,067
)
12,476

Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Current Period
Condensed Consolidating Statements of Operations
Three months ended June 30, 2015
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net revenue
$
1,432

220

640

(294
)
1,998

Cost of goods sold
856

23

382

(27
)
1,234

Gross profit
576

197

258

(267
)
764

Operating expenses:





Operating
98

61

89

(73
)
175

Selling, general and administrative, including stock-based compensation
260


81

(194
)
147

Depreciation
11

1

23


35

Amortization
60

41

12


113


429

103

205

(267
)
470

Operating income
147

94

53


294

Other (expense) income:





Equity in losses of investee


(3
)

(3
)
Interest expense, net
(49
)

(1
)

(50
)
Foreign currency (loss) gain
(7
)
(13
)
9


(11
)
Loss on extinguishment of debt
(21
)



(21
)
Intercompany interest (expense) income

(20
)
20




(77
)
(33
)
25


(85
)
Income before income taxes
70

61

78


209

Income tax expense
(14
)
(38
)
(33
)

(85
)
Equity in earnings of subsidiaries, net of tax
68

28

47

(143
)

Net income
124

51

92

(143
)
124

Less net income attributable to the noncontrolling interest
(8
)

(8
)
8

(8
)
Net income attributable to QVC, Inc. stockholder
$
116

51

84

(135
)
116

Condensed Consolidating Statements of Operations
Six months ended June 30, 2015
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net revenue
$
2,812

422

1,297

(595
)
3,936

Cost of goods sold
1,715

48

768

(76
)
2,455

Gross profit
1,097

374

529

(519
)
1,481

Operating expenses:





Operating
199

118

178

(152
)
343

Selling, general and administrative, including stock-based compensation
502


162

(367
)
297

Depreciation
21

4

43


68

Amortization
119

81

33


233


841

203

416

(519
)
941

Operating income
256

171

113


540

Other (expense) income:





Equity in losses of investee


(4
)

(4
)
Interest expense, net
(107
)

(2
)

(109
)
Foreign currency gain (loss)
5

(13
)
7


(1
)
Loss on extinguishment of debt
(21
)



(21
)
Intercompany interest (expense) income
(6
)
(9
)
15




(129
)
(22
)
16


(135
)
Income before income taxes
127

149

129


405

Income tax expense
(40
)
(63
)
(54
)

(157
)
Equity in earnings of subsidiaries, net of tax
161

39

47

(247
)

Net income
248

125

122

(247
)
248

Less net income attributable to the noncontrolling interest
(17
)

(17
)
17

(17
)
Net income attributable to QVC, Inc. stockholder
$
231

125

105

(230
)
231

Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Prior Period
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
$
2,731

390

1,451

(572
)
4,000

Cost of goods sold
1,692

48

878

(112
)
2,506

Gross profit
1,039

342

573

(460
)
1,494

Operating expenses:





Operating
161

113

201

(117
)
358

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

(1
)
181

(343
)
303

Depreciation
19

3

44


66

Amortization
110

77

36


223


756

192

462

(460
)
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 (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 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 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
$
1,388

199

719

(292
)
2,014

Cost of goods sold
850

23

432

(55
)
1,250

Gross profit
538

176

287

(237
)
764

Operating expenses:
 
 
 
 
 
Operating
82

57

100

(59
)
180

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


90

(178
)
155

Depreciation
10

1

22


33

Amortization
58

38

16


112


393

96

228

(237
)
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 (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), Current Period
Condensed Consolidating Statements of Comprehensive Income
Six months ended June 30, 2015
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net income
$
248

125

122

(247
)
248

Foreign currency translation adjustments
(80
)

(80
)
80

(80
)
Total comprehensive income
168

125

42

(167
)
168

Comprehensive income attributable to noncontrolling interest
(14
)

(14
)
14

(14
)
Comprehensive income (loss) attributable to QVC, Inc. stockholder
$
154

125

28

(153
)
154

Condensed Consolidating Statements of Comprehensive Income
Three months ended June 30, 2015
 
(in millions)
Parent
issuer-
QVC, Inc.

Combined
subsidiary
guarantors

Combined
non-guarantor
subsidiaries

Eliminations

Consolidated-
QVC, Inc. and
subsidiaries

Net income
$
124

51

92

(143
)
124

Foreign currency translation adjustments
22


22

(22
)
22

Total comprehensive income
146

51

114

(165
)
146

Comprehensive income attributable to noncontrolling interest
(6
)

(6
)
6

(6
)
Comprehensive income attributable to QVC, Inc. stockholder
$
140

51

108

(159
)
140

Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Prior Period
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

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

Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Current Period
Condensed Consolidating Statements of Cash Flows
Six months ended June 30, 2015
 
(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
$
352

166

87


605

Investing activities:
 
 
 
 
 
Capital expenditures, net
(55
)
(5
)
(19
)

(79
)
Expenditures for cable and satellite television distribution rights, net

(45
)


(45
)
Changes in other noncurrent assets
(1
)

(2
)

(3
)
Intercompany investing activities
1,147

296

(1,307
)
(136
)

Net cash provided by (used in) investing activities
1,091

246

(1,328
)
(136
)
(127
)
Financing activities:
 
 
 
 
 
Principal payments of debt and capital lease obligations
(1,212
)

(4
)

(1,216
)
Principal borrowings of debt from senior secured credit facility
1,098




1,098

Payment of debt origination fees
(3
)



(3
)
Payment of bond premium fees
(18
)



(18
)
Other financing activities
(1
)



(1
)
Dividends paid to Liberty
(210
)



(210
)
Dividends paid to noncontrolling interest


(20
)

(20
)
Net short-term intercompany debt (repayments) borrowings
(947
)
2,262

(1,315
)


Other intercompany financing activities
(100
)
(2,614
)
2,578

136


Net cash (used in) provided by financing activities
(1,393
)
(352
)
1,239

136

(370
)
Effect of foreign exchange rate changes on cash and cash equivalents


(10
)

(10
)
Net increase (decrease) in cash and cash equivalents
50

60

(12
)

98

Cash and cash equivalents, beginning of period
2

123

222


347

Cash and cash equivalents, end of period
$
52

183

210


445

Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Prior Period
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 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
)


Other 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