Liberty Media Reports First Quarter 2013 Financial Results

Before you go, we thought you'd like these...
Before you go close icon

Liberty Media Reports First Quarter 2013 Financial Results

ENGLEWOOD, Colo.--(BUSINESS WIRE)-- Liberty Media Corporation ("Liberty Media") (Nasdaq: LMCA, LMCB) today reported first quarter 2013 results. Highlights include(1):

  • SiriusXM reported strong Q1 results
    • Subscribers grew by 453,000 to a record 24.4 million
    • Record revenue of $897 million, up 12%
    • Net income of $124 million, up 15%
    • Adjusted EBITDA(2) grew 26% to $262 million
    • Named Jim Meyer CEO
  • Completed investment in Charter Communications on May 1
    • Own 27.3% of the outstanding equity
    • Four Liberty designated directors appointed to Charter's board
    • Secured $1.4 billion in financing
  • Repurchased $71 million of Liberty Media shares from February 1 through April 30

"We are extremely pleased with the operating results of our newest subsidiary, SiriusXM, which grew its subscriber base to over 24 million," said Greg Maffei, President and CEO of Liberty Media. "After an extensive search, Jim Meyer was named CEO of SiriusXM. Jim has been an integral part of SiriusXM's success and we are excited for him to lead the company going forward. Last week we closed our investment in Charter Communications and secured $1.4 billion of financing. We look forward to working with Tom Rutledge, his team, and our fellow board members."


Liberty Media

On January 11, 2013 Liberty Media was separated from Starz. Therefore, as of the first quarter of 2013 Liberty began presenting Starz as discontinued operations. Liberty acquired its controlling interest in SiriusXM on January 18, 2013 and has applied purchase accounting in consolidating the results of SiriusXM since that date. Prior to the acquisition of Liberty's controlling interest, we accounted for our investment in SiriusXM using the equity method.

Liberty Media's revenue increased $754 million to $789 million in the first quarter. Adjusted OIBDA increased $288 million to $271 million and operating income increased $192 million to $160 million. The increase in revenue, adjusted OIBDA and operating income was primarily due to the acquisition of a controlling interest in SiriusXM as discussed above.

SiriusXM

SiriusXM reported its stand-alone first quarter results on April 30, 2013. For presentation purposes in this release, we include below the results of SiriusXM, as reported by SiriusXM, without regard to the purchase accounting adjustments applied by us for purposes of our financial statements. Liberty believes the presentation of financial results as reported by SiriusXM is useful to investors as the comparability of those results are best understood in the context of SiriusXM's historical financial presentation. For a reconciliation of revenue, adjusted OIBDA (as defined by Liberty) and operating income for SiriusXM's stand-alone operating results as reported by SiriusXM, to those results as reported by Liberty, see Liberty's Form 10-Q for the quarter ended March 31, 2013.

Highlights of SiriusXM's earnings release included the following:

  • Subscribers grew by 453,000 to a record 24.4 million
  • Record revenue of $897 million, up 12%
  • Net Income of $124 million, up 15%
  • Adjusted EBITDA(2) grew 26% to a record $262 million
  • Free Cash Flow guidance increased
  • SiriusXM repurchased 209 million shares of common stock

All such amounts are representative of SiriusXM's stand-alone operating results and are not indicative of what is included in Liberty's financial statements due to certain purchase accounting adjustments resulting from our January 18, 2013 acquisition of SiriusXM. SiriusXM is a separate publicly traded company and additional information about SiriusXM can be obtained through its website and filings with the Securities and Exchange Commission.

Share Repurchases

From February 1, 2013 through April 30, 2013, 0.6 million shares of Series A Liberty Capital common stock (NAS: LMCA) were purchased at an average cost per share of $110.11 for total cash consideration of $71.0 million. After the completion of the Starz separation on January 11, 2013 through April 30, 2013, 1.1 million shares of Series A Liberty Capital common stock (NAS: LMCA) were purchased at an average cost per share of $110.15 for total cash consideration of $123.0 million. Since the reclassification of the original Liberty Capital tracking stock on March 4, 2008 through April 30, 2013, 59.6 million shares have been repurchased at an average cost per share of $34.01 for total cash consideration of $2.0 billion. These repurchases represent 46.1% of the shares outstanding at the time of the introduction of the original Liberty Capital stock. Liberty Media has approximately $327.0 million remaining under its current stock repurchase authorization.

Liberty Media Corporation owns interests in a broad range of media, communications and entertainment businesses, including its subsidiaries SiriusXM, Atlanta National League Baseball Club, Inc. and TruePosition, Inc., its interests in Charter Communications, Live Nation Entertainment and Barnes & Noble, and minority equity investments in Time Warner Inc., Time Warner Cable, and Viacom.

FOOTNOTES

  1) Liberty Media's President and CEO, Greg Maffei, will discuss these highlights and other matters in Liberty Media's earnings conference call which will begin at 11:00 a.m. (ET) on May 8, 2013. For information regarding how to access the call, please see "Important Notice" later in this document.
 
2)For definitions of adjusted OIBDA and Adjusted EBITDA (as defined by SiriusXM) and applicable reconciliations see the accompanying schedules.
 

NOTES

Unless otherwise noted, the foregoing discussion compares financial information for the three months ended March 31, 2013 to the same period in 2012.

The following financial information with respect to Liberty Media's equity affiliates and available for sale securities is intended to supplement Liberty Media's consolidated balance sheet and statement of operations to be included in its Form 10-Q.

Fair Value of Public Holdings

(amounts in millions)  12/31/2012  3/31/2013
SiriusXM debt and equity(1)  $9,621  $--
Live Nation debt and equity(2)494668
Barnes & Noble investment(3)262275
Other public holdings(4) 825 887
Total Liberty Media  $11,202  $1,830
 
(1) Represents the fair value of Liberty Media's debt and equity investments in SiriusXM. In accordance with GAAP, prior to consolidation, Liberty Media accounted for its equity investment in SiriusXM using the equity method of accounting and included this in its consolidated balance sheet at historical carrying value of $2,766 million at December 31, 2012. As previously disclosed, Liberty Media began consolidating SiriusXM in the first quarter of 2013.
(2)Represents the fair value of Liberty Media's debt and equity investments. In accordance with GAAP, Liberty Media accounts for its investment in the equity of Live Nation using the equity method of accounting and includes it in its consolidated balance sheet at its historical carrying value of $406 million and $393 million at December 31, 2012 and March 31, 2013, respectively.
(3)Represents the carrying value of Liberty Media's preferred equity investment in Barnes & Noble, which is accounted for at fair value.
(4)Represents Liberty Media's 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.

(amounts in millions)  12/31/2012  3/31/2013
Cash and liquid investments(1)(2)$670$1,991
Less: Short-term marketable securities6742
Less: Long-term marketable securities -- 49
Total Liberty Media Cash (GAAP)$603$1,900
 
Debt:
SiriusXM senior notes(3)(4)--1,700
SiriusXM exchangeable notes(3)(4)--491
Other debt -- 10
Total Liberty Media Debt$--$2,201
Unamortized premium -- 218
Total Liberty Media Debt (GAAP)$--$2,419
 
(1) Includes $67 million and $42 million of short-term marketable securities with an original maturity greater than 90 days as of December 31, 2012 and March 31, 2013, respectively.
(2)Includes $49 million of marketable securities with an original maturity greater than one year as of March 31, 2013, which is reflected in investments in available-for-sale securities in Liberty's condensed consolidated balance sheet.
(3)SiriusXM became a consolidated subsidiary of Liberty Media in the first quarter of 2013.
(4)Outstanding principal amount of Senior Notes and Exchangeable Senior Subordinated Notes with no increase for the premium resulting from purchase accounting.
 

Total Liberty Media group cash and liquid investments increased $1.3 billion, primarily as a result of $1.2 billion in cash distributed from Starz, net cash acquired from the consolidation of SiriusXM and cash provided by operations during the quarter, primarily at SiriusXM. The cash inflows were partially offset by repurchases of common stock by Liberty and SiriusXM.

Included in consolidated cash and liquid investments is $207 million at SiriusXM. Although SiriusXM is a consolidated subsidiary, they are a separate public company with a significant noncontrolling interest, therefore Liberty may not have ready access to that cash. Total Liberty Media debt increased by $2.2 billion, as a result of debt acquired from the consolidation of SiriusXM.

Important Notice: Liberty Media Corporation (Nasdaq: LMCA, LMCB) President and CEO, Greg Maffei, will discuss Liberty Media's earnings release in a conference call which will begin at 11:00 a.m. (ET) on May 8, 2013. The call can be accessed by dialing (877) 741-4241 or (719) 325-4781 at least 10 minutes prior to the start time. Replays of the conference call can be accessed until 11:00 a.m. (ET) May 15, 2013, by dialing (888) 203-1112 or (719) 457-0820 plus the pass code 1316456. The call will also be broadcast live across the Internet and archived on our website. To access the webcast go to http://www.libertymedia.com/events. Links to this press release will also be available on the Liberty Media website.

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, new service and product launches, the continuation of our stock repurchase plans, our recent investment in Charter Communications, our consolidation of SiriusXM, 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, competitive issues, regulatory matters affecting our businesses, continued access to capital on terms acceptable to Liberty Media, changes in law and market conditions conducive to stock repurchases.These forward-looking statements speak only as of the date of this presentation, and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Liberty Media's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Please refer to the publicly filed documents of Liberty Media, including the most recent Form 10-K and 10-Q, for additional information about Liberty Media and about the risks and uncertainties related to Liberty Media's business which may affect the statements made in this presentation.

LIBERTY MEDIA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET (unaudited)
 
    12/31/2012    3/31/2013
amounts in millions
ASSETS
Current assets:
Cash and cash equivalents$6031,900
Trade and other receivables, net25237
Deferred income tax assets--1,018
Other current assets211303
Assets of discontinued operations - current1,372  -- 
Total current assets2,211  3,458 
Investments in available-for-sale securities and other cost investments1,3921,266
Investments in affiliates, accounted for using the equity method3,341870
 
Property and equipment, at cost3291,963
Accumulated depreciation(172) (180)
1571,783
Intangible assets not subject to amortization
Goodwill20014,215
FCC licenses--8,600
Other144  1,074 
34423,889
 
Intangible assets subject to amortization, net1081,039
Other assets, at cost, net of accumulated amortization3291
Assets of discontinued operations740  -- 
Total assets$ 8,325  32,396 
 
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued liabilities$ 35631
Current portion of debt--4
Deferred revenue241,626
Deferred credit on executory contracts--166
Other current liabilities3325
Liabilities of discontinued operations - current293  -- 
Total current liabilities385  2,452 
 
Long-term debt--2,415
Deferred income tax liabilities8172,346
Deferred revenue37147
Other liabilities90285
Liabilities of discontinued operations564  -- 
Total liabilities1,893  7,645 
 
Equity:
Total stockholders' equity6,44014,277
Noncontrolling interests in equity of subsidiaries(8) 10,474 
Total equity6,432  24,751 
Commitments and contingencies   
Total liabilities and equity $8,325  32,396 
 
 
LIBERTY MEDIA CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (unaudited)
 
    Three months ended

3/31/2012

 

 

3/31/2013

Amount in millions
REVENUE:
Subscriber revenue$--635
Other revenue 35 154 
TOTAL REVENUE35789
 
OPERATING COSTS AND EXPENSES:
Cost of subscriber services(1)
Revenue share and royalties--124
Programming and content--54
Customer service and billing--66
Other--22
Subscriber acquisition cost--97
Other operating expense(1)2542
Selling, general and administrative(1)33154
Depreciation and amortization 9 70 
 67 629 
Operating income (loss)

(32

)

 

160
 
OTHER INCOME (EXPENSE):
Interest expense

(3

)

 

(11)
Dividend and interest income2212
Share of earnings (losses) of affiliates, net1217
Realized and unrealized gains (losses) on financial instruments, net11197
Gains (losses) on transactions, net-- Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners

Gift Finder Promo
More to Explore
Sun, Dec 04
Set Your Location
City, State, or Zip