Exhibit 99.1


LIBERTY INTERACTIVE CORPORATION REPORTS FIRST QUARTER 2013 FINANCIAL RESULTS
 
Englewood, Colorado, May 8, 2013 - Liberty Interactive Corporation (“Liberty”) (Nasdaq: LINTA, LINTB, LVNTA, LVNTB) today reported first quarter 2013 results. Highlights include(1):

Attributed to Liberty Interactive Group
Grew consolidated QVC revenue by 2% and adjusted OIBDA(2) by 4% in Q1
Grew QVC US revenue by 5% and adjusted OIBDA by 8%
US operating income grew by 5%
QVC.com revenue as a percent of total US revenue increased to 42%, a 3 point increase
QVC US mobile penetration was 27% of QVC.com orders
Consolidated operating income increased 1%
QVC issued 30-year and 10-year senior secured notes at 5.95% and 4.375%, respectively
eCommerce group grew revenue by 20% and adjusted OIBDA by 15%
Operating income grew by 27%
Repurchased $267 million of LINTA shares from February 1 to April 30
Attributed to Liberty Ventures Group
Called for redemption of the 3.125% exchangeable senior debentures due 2023
Issued new 0.75% exchangeable senior debentures due 2043

“QVC produced particularly strong results in the US, driven by solid operating performance and continued growth in eCommerce and mobile revenue. Our eCommerce companies showed marked improvement and returned to growth in adjusted OIBDA,” stated Greg Maffei, Liberty President and CEO. “We accelerated our repurchases of Liberty Interactive stock and bought $267 million worth of shares. Attributable to Liberty Ventures, post quarter close, we redeemed the 3.125% exchangeable debentures and issued new 30-year exchangeable debentures at an interest rate of 0.75% in a cash and tax neutral manner.”
 

1


LIBERTY INTERACTIVE GROUP - Liberty Interactive Group's revenue increased 5% to $2.4 billion in the first quarter, adjusted OIBDA increased 4% to $437 million and operating income was relatively flat at $260 million. The increase in revenue was due to 2% growth at QVC combined with favorable results at the eCommerce companies driven by the Easter holiday falling during the first quarter of 2013, increased marketing efforts driving additional traffic, greater conversion resulting from investments in site optimization, increased shipping charges, and broader inventory offerings. The increase in adjusted OIBDA for the quarter was due to the revenue growth at QVC and the eCommerce companies, offset by unfavorable foreign currency exchange rates.

QVC
QVC's consolidated net revenue increased 2% in the first quarter to $2.0 billion. During the same period, adjusted OIBDA increased 4% to $404 million and operating income increased 1% to $260 million. As 2012 was a leap year, the current period results include one less day versus the prior period.

“QVC's first quarter results were highlighted by strong revenue growth in the US and solid international performance,” said Mike George, QVC President and CEO. “We are seeing our customers embracing QVC as a destination that is centered around community, entertainment and relationships as much as it is around shopping.”

QVC's US revenue increased 5% to $1.3 billion in the first quarter primarily as a result of strength in the electronics and beauty categories. Average selling price per unit (“ASP”) increased 6% from $57.01 to $60.51, while units sold declined 1% compared to the prior year first quarter. Returns as a percent of gross product revenue improved 65 basis points. In the same period, eCommerce revenue increased 13% to $544 million and grew to 42% from 39% as a percentage of total US net revenue. Adjusted OIBDA increased 8% to $291 million and adjusted OIBDA margin(2) increased 67 basis points in the first quarter. Adjusted OIBDA margin increased primarily due to favorable warehouse, freight and obsolescence expenses.

QVC's international revenue in US Dollars decreased 2% in the first quarter to $677 million. The first quarter results included the negative impact of the strengthening of the US Dollar against the Japanese Yen, and to a lesser extent, the UK Pound Sterling, which were somewhat offset by the weakening of the US Dollar against the Euro. Adjusted OIBDA decreased 6% to $113 million and adjusted OIBDA margin decreased 65 basis points in the first quarter. In constant currency, QVC's international revenue and adjusted OIBDA increased 4% and 1%, respectively.


2


QVC Japan's revenue grew 3% in local currency in the first quarter due to growth in all categories except home. QVC Japan's ASP in local currency increased 3% and units sold increased 3% in the first quarter. QVC Japan's first quarter returns as a percent of gross product revenue in local currency increased 97 basis points due primarily to higher return rates in jewelry, apparel and accessories. QVC Japan's adjusted OIBDA in local currency was relatively flat and adjusted OIBDA margin decreased 71 basis points in the first quarter. The decrease in adjusted OIBDA margin was primarily applicable to duplicate running costs and a lease cancellation accrual associated with the transition to its new headquarters in March 2013.

In US Dollars, QVC Japan's revenue and adjusted OIBDA decreased 11% and 14%, respectively. The decrease in revenue and adjusted OIBDA during the quarter was driven by a 14% decline in the Japanese Yen which created significant pressure on US Dollar denominated results.

QVC Germany's revenue increased 1% in local currency in the first quarter primarily due to sales growth in the beauty, apparel and accessories categories, partially offset by lower jewelry sales. QVC Germany's ASP in local currency remained flat, while units sold increased 4% in the first quarter. QVC Germany's first quarter return rate as a percent of gross product revenue in local currency increased 266 basis points from the prior year due primarily to changes in prior period estimates based on actual experience as well as higher returns in electronics and jewelry. QVC Germany's adjusted OIBDA in local currency decreased 7% and adjusted OIBDA margin decreased 142 basis points for the first quarter. Adjusted OIBDA margin decreased primarily due to an accrual made in connection with additional taxes and social security contributions expected to result from a potential reclassification of certain workers. Excluding this accrual, adjusted OIBDA would have increased 1%, consistent with revenue growth.

QVC UK's revenue grew 1% in local currency in the first quarter primarily due to sales in the home and beauty categories, partially offset by lower jewelry sales. QVC UK's ASP in local currency increased 4%, while units sold decreased 3% in the first quarter. QVC UK's first quarter return rate as a percent of gross product revenue in local currency decreased 97 basis points. UK's adjusted OIBDA in local currency decreased 6% and adjusted OIBDA margin decreased 72 basis points in the first quarter. The decrease in adjusted OIBDA margin was primarily due to lower product margins and inventory FX losses from a decline in the value of the UK Pound Sterling.

QVC Italy's revenue increased 90% in local currency in the first quarter. QVC Italy's sales were primarily from the cooking and dining, beauty and apparel product categories. QVC Italy's ASP in local currency increased 2% and units sold increased 87% in the first quarter. In the same period, the adjusted OIBDA deficit improved by 67%.

3


CNRS, QVC's joint venture in China, saw revenue increase 39% in local currency in the first quarter. In the same period, CNRS' adjusted OIBDA deficit improved by 41%. This joint venture is being accounted for as an equity method investment.

QVC's outstanding bank and bond debt was $3.5 billion at March 31, 2013, an increase of over $100 million since December 31, 2012. On March 1, 2013, QVC amended and restated its bank credit facility to, among other things, extend the maturity of the bank credit facility to March 1, 2018 and lower the interest rate on borrowings. On March 18, 2013, QVC issued $750 million principal amount of 4.375% Senior Secured Notes due 2023 and $300 million principal amount of 5.95% Senior Secured Notes due 2043. The net proceeds from the issuance of these instruments were used to reduce the outstanding principal under QVC's existing notes and bank credit facility, as well as for general corporate purposes. On March 18, 2013, QVC repurchased $124 million of its 7.125% Senior Secured Notes due 2017 and $231 million of its 7.5% Senior Secured Notes due 2019 via a tender offer. On April 17, 2013, QVC completed the redemption of the remaining $376 million principal amount of its 7.125% Senior Secured Notes due 2017, fully retiring these notes.

eCommerce Businesses
In the aggregate, Liberty Interactive Group's eCommerce businesses increased revenue 20% to $460 million for the first quarter. Adjusted OIBDA increased 15% to $39 million and operating income increased 27% to $19 million. The increase in revenue, adjusted OIBDA and operating income were the result of the Easter holiday falling during the first quarter of 2013, increased marketing efforts driving additional traffic, greater conversion resulting in site optimization, increased shipping charges, and broader inventory offerings. The decrease in adjusted OIBDA as a percentage of revenue was primarily due to an inventory reserve adjustment at one of our subsidiaries and lower product margins as a result of product discounts and promotions offered during the period.

Share Repurchases
From February 1, 2013 through April 30, 2013, Liberty repurchased approximately 12.6 million Series A Liberty Interactive shares at an average cost per share of $21.23 for total cash consideration of $267.1 million. Since the creation of the Liberty Interactive stock in May 2006, Liberty has repurchased approximately 196.8 million shares at an average cost per share of $19.16 for aggregate cash consideration of $3.8 billion. These repurchases represent approximately 28.1% of the shares outstanding at the time of creation of the Liberty Interactive stock. All repurchases up to August 9, 2012, the date on which the Liberty Interactive stock was recapitalized to create the Liberty Ventures stock, were comprised of shares of the combined stocks. The total remaining repurchase authorization for Liberty Interactive Group stock is approximately $929 million.

4



Liberty Interactive Group holds controlling interests in companies that are engaged in digital commerce, including QVC, Provide Commerce, Backcountry.com, Bodybuilding.com, Celebrate Interactive, CommerceHub, and also owns interests in HSN and Lockerz.

LIBERTY VENTURES GROUP - As of March 31, 2013, the fair value of the equity method securities and non-strategic AFS securities attributed to the Liberty Ventures Group was $1.8 billion and $1.9 billion, respectively. When compared to the value as of December, 31, 2012, the fair value of Liberty Ventures Group's equity method securities increased 2% and AFS securities increased 5%.

Share Repurchases
There were no repurchases of Liberty Ventures Group stock from February 1, 2013 through April 30, 2013. The Liberty Ventures Group does not have an outstanding stock repurchase authorization at this time.

The businesses and assets attributed to the Liberty Ventures Group are all of Liberty's businesses and assets other than those attributed to the Liberty Interactive Group and include its subsidiary TripAdvisor, its interest in Expedia, and minority interests in Time Warner and Time Warner Cable. TripAdvisor is a separate publicly traded company and additional information about TripAdvisor can be obtained through its website and filings with the Securities and Exchange Commission.

FOOTNOTES

1)
Liberty's President and CEO, Greg Maffei, will discuss these highlights and other matters in Liberty's earnings conference call which will begin at 11:45 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 a definition of adjusted OIBDA and applicable reconciliations and a definition of adjusted OIBDA margin, see the accompanying schedules.

5


LIBERTY INTERACTIVE GROUP FINANCIAL METRICS - QUARTER
(amounts in millions)
1Q12
1Q13
% Change
Revenue
 
 
 
QVC
 
 
 
   US
$
1,240

$
1,297

5
 %
   International
692

677

-2
 %
Total QVC Revenue
1,932

$
1,974

2
 %
eCommerce businesses
382

460

20
 %
Total Liberty Interactive Group Revenue
$
2,314

$
2,434

5
 %
 
 
 
 
Adjusted OIBDA
 
 
 
QVC
 
 
 
   US
$
270

$
291

8
 %
   International
120

113

-6
 %
Total QVC Adjusted OIBDA
390

404

4
 %
eCommerce businesses
34

39

15
 %
Corporate and other
(5
)
(6
)
-20
 %
Total Liberty Interactive Group Adjusted OIBDA
$
419

$
437

4
 %
 
 
 
 
Operating Income
 
 
 
QVC
 
 
 
   US
$
171

$
180

5
 %
   International
87

80

-8
 %
Total QVC Operating Income
$
258

$
260

1
 %
eCommerce businesses
15

19

27
 %
Corporate and other
(14
)
(19
)
-36
 %
Total Liberty Interactive Group Operating Income
$
259

$
260

0
 %
 
 
 
 
 
 
 
 
(amounts in millions)
 
 
 
LINT Shares Outstanding
4/30/2012

4/30/2013

 
Outstanding A and B shares
559

530

 
 
 
 
 


(amounts in millions)
 
 
 
LINTA and LINTB Basic and Diluted Shares
Quarter ended 3/31/2012(1)
Quarter ended 3/31/2013
 
Basic Weighted Average Shares Outstanding (“WASO”)
572

535

 
Potentially dilutive Shares
9

7

 
Diluted WASO
581

542

 
 
 
 
 
(1)
Represents the basic and diluted WASO for Liberty Interactive Corporation prior to the recapitalization of Liberty Interactive Corporation into the Liberty Interactive Group and Liberty Ventures Group tracking stocks on August 9, 2012.

6


QVC OPERATING METRICS - QUARTER
(amounts in millions except average sale price amounts)
1Q12
1Q13
% Change
QVC - Consolidated(1)
 
 
 
   Revenue
$
1,932

$
1,974

2
 %
   Adjusted OIBDA
$
390

$
404

4
 %
   Adjusted OIBDA margin
20.19
 %
20.47
 %
 28 bps

 
 
 
 
eCommerce and Mobile Metrics
 
 
 
   eCommerce $ of total revenue
$
631

$
715

13
 %
   eCommerce % of total revenue
32.66
 %
36.22
 %
 356 bps

 
 
 
 
   Mobile % of total eCommerce(2)
18.49
 %
27.73
 %
924 bps

 
 
 
 
QVC - US(1)
 
 
 
   Revenue
$
1,240

$
1,297

5
 %
   Adjusted OIBDA
$
270

$
291

8
 %
   Adjusted OIBDA margin
21.77
 %
22.44
 %
 67 bps

   Average sale price (ASP)
$
57.01

$
60.51

6
 %
   Units sold
23.88

23.53

-1
 %
   Return rate
19.48
 %
18.83
 %
 65 bps

 
 
 
 
eCommerce and Mobile Metrics
 
 
 
   eCommerce $ of US revenue
$
481

$
544

13
 %
   eCommerce % of US revenue
38.79
 %
41.94
 %
 315 bps

 
 
 
 
   Mobile % of US eCommerce(2)
15.84
 %
26.99
 %
1,115 bps

 
 
 
 
QVC - Japan(1)
 
 
 
   Revenue
$
289

$
256

-11
 %
   Adjusted OIBDA
$
63

$
54

-14
 %
   Adjusted OIBDA margin
21.8
 %
21.09
 %
(71) bps

   Average sale price (ASP)
¥
6,402.89

¥
6,568.51

3
 %
   Units sold
3.93

4.03

3
 %
 
 
 
 
QVC - Germany(1)
 
 
 
   Revenue
$
247

$
250

1
 %
   Adjusted OIBDA
$
46

$
43

-7
 %
   Adjusted OIBDA margin
18.62
 %
17.2
 %
(142) bps

   Average sale price (ASP)
36.80

36.70

 %
   Units sold
6.44

6.71

4
 %
 
 
 
 
QVC - UK(1)
 
 
 
   Revenue
$
140

$
140

 %
   Adjusted OIBDA
$
20

$
19

-5
 %
   Adjusted OIBDA margin
14.29
 %
13.57
 %
(72) bps

   Average sale price (ASP)
£
28.38

£
29.46

4
 %
   Units sold
3.47

3.35

-3
 %
 
 
 
 
QVC - Italy(1)
 
 
 
   Revenue
$
16

$
31

94
 %
   Adjusted OIBDA
$
(9
)
$
(3
)
67
 %
   Adjusted OIBDA margin
(56.25
)%
(9.68
)%
4,657 bps

   Average sale price (ASP)
32.19

32.80

2
 %
   Units sold
0.39

0.73

87
 %
(1)
Revenue change, adjusted OIBDA change and eCommerce and Mobile Metrics calculated in US Dollars, not local currency.
(2)
Based on gross orders.
 

7


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's equity affiliates and available for sale securities is intended to supplement Liberty's consolidated statements of operations which are included in its Form 10-Q.

Fair Value of Public Holdings
(amounts in millions)
12/31/2012
3/31/2013
HSN(1)
$
1,102

$
1,098

     Total Attributed Liberty Interactive Group
$
1,102

$
1,098

 
 
 
Expedia(2)
$
1,389

$
1,385

Interval Leisure Group and Tree.com(3)
373

413

Other Public Holdings(4)
1,815

1,905

     Total Attributed Liberty Ventures Group
$
3,577

$
3,703

(1)
Represents fair value of Liberty Interactive Group's investment in HSN. In accordance with GAAP, Liberty Interactive Group accounts for this investment using the equity method of accounting and includes this investment in its consolidated balance sheet at its historical carrying value which aggregated $242 million and $261 million at December 31, 2012 and March 31, 2013, respectively.
(2)
Represents fair value of Liberty Ventures Group's investment in Expedia. In accordance with GAAP, Liberty Ventures Group accounts for this investment using the equity method of accounting and includes this investment in its consolidated balance sheet at its historical carrying value which aggregated $431 million and $430 million at December 31, 2012 and March 31, 2013, respectively.
(3)
Represents fair value of Liberty Ventures Group's investments. In accordance with GAAP, Liberty Ventures Group accounts for these investments using the equity method of accounting and includes these investments in its consolidated balance sheet at their historical carrying values which aggregated $90 million and $93 million at December 31, 2012 and March 31, 2013, respectively.
(4)
Represents Liberty Ventures Group's other public holdings which are accounted for at fair value.



8


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 Attributable to:
 
 
Liberty Interactive Group
$
699

$
587

Liberty Ventures Group(1)(2)
2,147

1,724

Total Liberty Consolidated Cash and Liquid Investments
$
2,846

$
2,311

 
 
 
Less:
 
 
Short-term marketable securities - Liberty Ventures Group
$
186

$
473

Long-term marketable securities - Liberty Ventures Group

468

Total Liberty Consolidated Cash (GAAP)
$
2,660

$
1,370

 
 
 
Debt:
 
 
Senior notes and debentures(3)
$
1,032

$
1,032

QVC senior notes(3)
2,500

3,195

QVC bank credit facility
903

328

Other
125

131

Total Attributed Liberty Interactive Group Debt
$
4,560

$
4,686


(18
)
(15
)
Total Attributed Liberty Interactive Group Debt (GAAP)
$
4,542

$
4,671

 
 
 
Senior exchangeable debentures(4)
2,852

2,425


412

391

Total Attributed Liberty Ventures Group Debt
$
3,264

$
2,816

Fair market value adjustment
78

388

Total Attributed Liberty Ventures Group Debt (GAAP)
$
3,342

$
3,204

 
 
 
Total Liberty Interactive Corporation Debt (GAAP)
$
7,884

$
7,875

 
 
 
(1)
Includes $186 million and $473 million of short-term marketable securities with an original maturity greater than 90 days as of December 31, 2012 and March 31, 2013, respectively which are included in other current assets in Liberty Ventures Group's condensed consolidated balance sheets.
(2)
Includes $468 million of marketable securities with an original maturity greater than one year as of March 31, 2013, which are reflected in investments in available-for-sale securities in Liberty Ventures Group's condensed consolidated balance sheet.
(3)
Face amount of Senior Notes and Debentures with no reduction for the unamortized discount.
(4)
Face amount of Senior Exchangeable Debentures with no reduction for the fair market value adjustment.

Total cash and liquid investments attributed to the Liberty Interactive Group decreased $112 million, primarily due to stock repurchases and capital expenditures. These cash outflows were partially offset by cash flow from operations at QVC and borrowings of debt at QVC in excess of repayments. Total debt attributed to the Liberty Interactive Group increased by $126 million, primarily due to the first quarter debt refinancing at QVC, in excess of repayments on QVC senior notes and bank credit facilities.

Total cash and liquid investments attributed to the Liberty Ventures Group decreased $423 million, primarily due to debt repayments. Included in the total cash and liquid investments attributed to the Liberty Ventures Group is $594 million held at TripAdvisor, which is comprised of $209 million of cash, $194 million of short-term marketable securities and $191 million of long-term marketable securities. Although TripAdvisor is a consolidated subsidiary, they are a separate public company with a significant noncontrolling interest, therefore Liberty may not have ready access to those cash and liquid investments. Total debt attributed to the Liberty Ventures Group decreased by $448 million, primarily due to repayments made on senior exchangeable debentures.

9



Important Notice: Liberty (Nasdaq: LINTA, LINTB, LVNTA, LVNTB) President and CEO, Greg Maffei will discuss Liberty's earnings release in a conference call which will begin at 11:45 a.m. (ET) on May 8, 2013. The call can be accessed by dialing (888) 337-8192 or (719) 325-2243 at least 10 minutes prior to the start time. Replays of the conference call can be accessed until 11:45 a.m. (ET) on May 15, 2013, by dialing (888) 203-1112 or (719) 457-0820 plus the pass code 9345991. The call will also be broadcast live across the Internet and archived on our website. To access the webcast go to http://www.libertyinteractive.com/events. Links to this press release will also be available on Liberty's 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, international expansion, the effect of digital conversion on QVC's channel placement, new service and product offerings, QVC's mobile commerce platform, the continuation of our stock repurchase program, 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 Interactive and market conditions conducive to stock repurchases. These forward-looking statements speak only as of the date of this presentation, and Liberty Interactive 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 Interactive'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 Interactive, including the most recent Forms 10-K and 10-Q, for additional information about Liberty Interactive and about the risks and uncertainties related to Liberty Interactive's business which may affect the statements made in this presentation.
  
Contact: Courtnee Ulrich (720) 875-5420


10


SUPPLEMENTAL INFORMATION
As a supplement to Liberty's consolidated statements of operations, which are included in its Form 10-Q, the following is a presentation of quarterly information and operating metrics on a stand-alone basis for the largest business owned by Liberty (QVC) at March 31, 2013, which Liberty has identified as a reportable segment.

Please see below for the definition of adjusted OIBDA and a discussion of why management believes the presentation of adjusted OIBDA for QVC provides useful information for investors. Schedule 2 to this press release provides a reconciliation of adjusted OIBDA for each identified reportable segment to that segment's operating income for the same period, as determined under GAAP.

QUARTERLY SUMMARY
(amounts in millions)
1Q12
2Q12
3Q12
4Q12
1Q13
Liberty Interactive Group
 
 
 
 
 
QVC
 
 
 
 
 
Revenue - US
$
1,240

$
1,280

$
1,237

$
1,828

$
1,297

Revenue - International
692

694

681

864

677

Revenue - Total
$
1,932

$
1,974

$
1,918

$
2,692

$
1,974

Adjusted OIBDA - US
270

315

278

429

291

Adjusted OIBDA - International
120

123

119

174

113

Adjusted OIBDA - Total
$
390

$
438

$
397

$
603

$
404

Operating income - US
171

214

173

312

180

Operating income - International
87

87

87

137

80

Operating income - Total
$
258

$
301

$
260

$
449

$
260

Gross margin - US
35.6
%
37.2
%
36.1
%
34.7
%
36.1
%
Gross margin - International
37.7
%
38.1
%
37.4
%
37.1
%
37.5
%
 
 
 
 
 
 


NON-GAAP FINANCIAL MEASURES

This press release includes a presentation of adjusted OIBDA, which is a non-GAAP financial measure, for Liberty, QVC (and certain of its subsidiaries), and the eCommerce businesses together with a reconciliation to that entity's operating income, as determined under GAAP. Liberty defines adjusted OIBDA as revenue less cost of sales, operating expenses, and selling, general and administrative expenses, excluding all stock based compensation, and excludes from that definition depreciation and amortization and restructuring and impairment charges that are included in the measurement of operating income pursuant to GAAP. Further, this press release includes adjusted OIBDA margin which is also a non-GAAP financial measure. Liberty defines adjusted OIBDA margin as adjusted OIBDA divided by revenue.

Liberty believes adjusted OIBDA is an important indicator of the operational strength and performance of its businesses, including each business' ability to service debt and fund capital expenditures. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. Because adjusted OIBDA is used as a measure of operating performance, Liberty views operating income as the most directly comparable GAAP measure. Adjusted OIBDA is not meant to replace or supersede operating income or any other GAAP measure, but rather to supplement such GAAP measures in order to present investors with the same information that Liberty's management considers in assessing the results of operations and performance of its assets. Please see the attached schedules for applicable reconciliations.

11




SCHEDULE 1

The following table provides a reconciliation of Liberty Interactive Group's adjusted OIBDA to its operating income calculated in accordance with GAAP for the three months ended March 31, 2012, June 30, 2012, September 30, 2012, December 31, 2012 and March 31, 2013, respectively.

QUARTERLY SUMMARY
(amounts in millions)
1Q12
2Q12
3Q12
4Q12
1Q13
Liberty Interactive Group
 
 
 
 
 
Adjusted OIBDA
$
419

$
455

$
397

$
626

$
437

Depreciation and amortization
(143
)
(147
)
(147
)
(159
)
(153
)
Stock compensation expense
(17
)
(18
)
(18
)
(32
)
(24
)
Impairment of intangible assets


(39
)
(53
)

Operating Income
$
259

$
290

$
193

$
382

$
260

 
 
 
 
 
 

SCHEDULE 2

The following table provides a reconciliation of adjusted OIBDA for QVC (and certain of its subsidiaries) and the eCommerce businesses to that entity or Group's operating income (loss) calculated in accordance with GAAP for the three months ended March 31, 2012, June 30, 2012, September 30, 2012, December 31, 2012 and March 31, 2013, respectively.

QUARTERLY SUMMARY
(amounts in millions)
1Q12
2Q12
3Q12
4Q12
1Q13
Liberty Interactive Group
 
 
 
 
 
QVC Adjusted OIBDA
 
 
 
 
 
QVC US
$
270

$
315

$
278

$
429

$
291

 
 
 
 
 
 
QVC Japan
63

70

67

79

54

QVC Germany
46

39

36

58

43

QVC UK
20

21

21

42

19

QVC Italy
(9
)
(7
)
(5
)
(5
)
(3
)
QVC International adjusted OIBDA
$
120

$
123

$
119

$
174

$
113

 
 
 
 
 
 
Consolidated QVC adjusted OIBDA
390

438

397

603

404

Depreciation and amortization
(127
)
(129
)
(129
)
(141
)
(134
)
Stock compensation
(5
)
(8
)
(8
)
(13
)
(10
)
Operating Income
$
258

$
301

$
260

$
449

$
260

 
 
 
 
 
 
eCommerce Businesses
 
 
 
 
 
Adjusted OIBDA
34

23

4

35

39

Depreciation and amortization
(17
)
(16
)
(18
)
(19
)
(18
)
Stock compensation
(2
)
(8
)
(3
)
(2
)
(2
)
Impairment of intangible assets


(39
)
(53
)

        Operating Income (Loss)
$
15

$
(1
)
$
(56
)
$
(39
)
$
19

 
 
 
 
 
 



12


LIBERTY INTERACTIVE CORPORATION
BALANCE SHEET INFORMATION
March 31, 2013 - (unaudited)
 
Attributed
 
 
 
 
 
Interactive
Group
 
Ventures
Group
 
Inter-group Eliminations
 
Consolidated Liberty
ASSETS
amounts in millions
Current assets:
 
 
 
 
 
 
 
Cash and cash equivalents
$
587

 
783

 

 
1,370

 
Trade and other receivables, net
814
 
 
158

 

 
972

 
Inventory, net
1,116
 
 

 

 
1,116

 
Other current assets
238
 
 
493

 
(156
)
 
575

 
Total current assets
2,755
 
 
1,434

 
(156
)
 
4,033

 
 Investments in available-for-sale securities and other cost investments
4
 
 
2,373

 

 
2,377

 
 Investments in affiliates, accounted for using the equity method
319
 
 
551

 

 
870

 
 Property and equipment, net
1,174
 
 
15

 

 
1,189

 
 Intangible assets not subject to amortization
8,376
 
 
5,484

 

 
13,860

 
 Intangible assets subject to amortization, net
1,831
 
 
1,085

 

 
2,916

 
 Other assets, at cost, net of accumulated amortization
95
 
 
14

 

 
109

 
Total assets
$
14,554

 
10,956

 
(156
)
 
25,354

 
 
 
 
 
 
 
 
 
 LIABILITIES AND EQUITY
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
Intergroup Payable (receivable)
$
21

 
(21
)
 

 

 
Accounts payable
523
 
 
12

 

 
535

 
Accrued liabilities
690
 
 
69

 

 
759

 
Current portion of debt
262
 
 
1,020

 

 
1,282

 
Current deferred tax liabilities
 
 
960

 
(156
)
 
804

 
Other current liabilities
256
 
 
70

 

 
326

 
Total current liabilities
1,752
 
 
2,110

 
(156
)
 
3,706

 
 Long-term debt
4,409
 
 
2,184

 

 
6,593

 
 Deferred income tax liabilities
1,267
 
 
1,808

 

 
3,075

 
 Other liabilities
210
 
 
2

 

 
212

 
Total liabilities
7,638
 
 
6,104

 
(156
)
 
13,586

 
 Equity/Attributed net assets (liabilities)
6,792
 
 
484

 

 
7,276

 
 Noncontrolling interests in equity of subsidiaries
124
 
 
4,368

 

 
4,492

 
Total liabilities and equity
$
14,554

 
10,956

 
(156
)
 
25,354

 
 
 
 
 
 
 
 
 
 
 



13


LIBERTY INTERACTIVE CORPORATION
STATEMENT OF OPERATIONS INFORMATION
Three months ended March 31, 2013 - (unaudited)
 
Attributed
 
 
 
Interactive
Group
 
Ventures
Group
 
Consolidated Liberty
 
amounts in millions
REVENUE:
 
 
 
 
 
Net retail sales
$
2,434

 

 
2,434

 
    Other revenue
 
 
230

 
230

 
          Total revenue
2,434
 
 
230

 
2,664

 
 
 
 
 
 
 
 
OPERATING COSTS AND EXPENSES:
 
 
 
 
 
Cost of sales
1,553
 
 

 
1,553

 
Operating, including stock-based compensation
208
 
 
36

 
244

 
Selling, general and administrative, including stock-based compensation
260
 
 
106

 
366

 
Depreciation and amortization
153
 
 
77

 
230

 
 
2,174
 
 
219

 
2,393

 
        Operating income
260
 
 
11

 
271

 
 
 
 
 
 
 
OTHER INCOME (EXPENSE):
 
 
 
 
 
Interest expense
(84
)
 
(27
)
 
(111
)
 
Share of earnings (losses) of affiliates, net
16
 
 
(27
)
 
(11
)
 
Realized and unrealized gains (losses) on financial instruments, net
13
 
 
(86
)
 
(73
)
 
Other, net
(40
)
 
2

 
(38
)
 
 
(95
)
 
(138
)
 
(233
)
 
        Earnings (loss) before income taxes
165
 
 
(127
)
 
38

 
 Income tax benefit (expense)
(58
)
 
73

 
15

 
        Net earnings (loss)
107
 
 
(54
)
 
53

 
 Less net earnings (loss) attributable to noncontrolling interests
12
 
 
14

 
26

 
 Net earnings (loss) attributable to Liberty stockholders
$
95

 
(68
)
 
27

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LINT Shares Outstanding
 
 
 
 
 
 
 
 Outstanding A and B shares as of April 30, 2013 (in millions)
 
530

 
 
 
 
 
 
 
 
 
 
 
 
 
LINTA and LINTB Basic and Diluted Shares (in millions)
 
Quarter ended 3/31/2013

 
 
 
 
 
Basic Weighted Average Shares Outstanding (“WASO”)
 
535

 
 
 
 
 
       Potentially dilutive shares
 
7

 
 
 
 
 
       Diluted WASO
 
542

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

14


LIBERTY INTERACTIVE CORPORATION
STATEMENT OF OPERATIONS INFORMATION
Three months ended March 31, 2012 - (unaudited)
 
Attributed
 
 
 
Interactive
Group
 
Ventures
Group
 
Consolidated Liberty
 
 
amounts in millions
REVENUE:
 
 
 
 
 
Net retail sales
$
2,314

 

 
2,314

 
    Other revenue
 
 

 

 
Total revenue
2,314
 
 

 
2,314

 
 
 
 
 
 
 
 
OPERATING COSTS AND EXPENSES:
 
 
 
 
 
Cost of sales
1,466
 
 

 
1,466

 
Operating
208
 
 

 
208

 
Selling, general and administrative, including stock-based compensation
238
 
 
1

 
239

 
Depreciation and amortization
143
 
 

 
143

 
 
2,055
 
 
1

 
2,056

 
Operating income (loss)
259
 
 
(1
)
 
258

 
 
 
 
 
 
 
OTHER INCOME (EXPENSE):
 
 
 
 
 
Interest expense
(77
)
 
(29
)
 
(106
)
 
Share of earnings (losses) of affiliates, net
13
 
 
(2
)
 
11

 
Realized and unrealized gains (losses) on financial instruments, net
14
 
 
(32
)
 
(18
)
 
Other, net
3
 
 

 
3

 
 
(47
)
 
(63
)
 
(110
)
 
Earnings (loss) before income taxes
212
 
 
(64
)
 
148

 
 Income tax benefit (expense)
(79
)
 
36

 
(43
)
 
 Net earnings (loss)
133
 
 
(28
)
 
105

 
 Less net earnings (loss) attributable to the noncontrolling interests
14
 
 

 
14

 
 Net earnings (loss) attributable to Liberty stockholders
$
119

 
(28
)
 
91

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LINT Shares Outstanding
 
 
 
 
 
 
 
 Outstanding A and B shares as of April 30, 2012 (in millions)
 
559

 
 
 
 
 
 
 
 
 
 
 
 
 
LINTA and LINTB Basic and Diluted Shares (in millions)
 
Quarter ended 3/31/2012

 
 
 
 
 
Basic Weighted Average Shares Outstanding (“WASO”)
 
572

 
 
 
 
 
       Potentially dilutive shares
 
9

 
 
 
 
 
       Diluted WASO
 
581

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

15


LIBERTY INTERACTIVE CORPORATION
STATEMENT OF CASH FLOWS INFORMATION
Three months ended March 31, 2013 - (unaudited)
 
Attributed
 
 
 
Interactive
Group
 
Ventures
Group
 
Consolidated Liberty
 
 
amounts in millions
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
Net earnings (loss)
$
107

 
(54
)
 
53

 
Adjustments to reconcile net earnings to net cash provided by operating activities:
 
 
 
 
 
Depreciation and amortization
153
 
 
77

 
230

 
Stock-based compensation
24
 
 
18

 
42

 
Cash payments for stock based compensation
(2
)
 
(1
)
 
(3
)
 
Share of (earnings) losses of affiliates, net
(16
)
 
27

 
11

 
Cash receipts from return on equity investments
4
 
 
3

 
7

 
Realized and unrealized gains (losses) on financial instruments, net
(13
)
 
86

 
73

 
Deferred income tax (benefit) expense
(27
)
 
(192
)
 
(219
)
 
Other, net
11
 
 

 
11

 
Intergroup tax allocation
41
 
 
(41
)
 

 
Changes in operating assets and liabilities
 
 
 
 
 
Current and other assets
259
 
 
(53
)
 
206

 
Payables and other current liabilities
(395
)
 
76

 
(319
)
 
Net cash provided (used) by operating activities
146
 
 
(54
)
 
92

 
 
 
 
 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
 
 
 
Cash proceeds from dispositions
 
 
37

 
37

 
Investments in and loans to cost and equity investees
 
 
(38
)
 
(38
)
 
Capital expended for property and equipment
(50
)
 
(9
)
 
(59
)
 
Net sales (purchases) of short term and other marketable securities
 
 
(658
)
 
(658
)
 
Other investing activities, net
(30
)
 
(6
)
 
(36
)
 
Net cash provided (used) by investing activities
(80
)
 
(674
)
 
(754
)
 
 
 
 
 
 
 
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
 
 
Borrowings of debt
1,383
 
 
4

 
1,387

 
Repayments of debt
(1,251
)
 
(452
)
 
(1,703
)
 
Intergroup receipts (payments), net
2
 
 
(2
)
 

 
Repurchases of Liberty common stock
(252
)
 

 
(252
)
 
Other financing activities, net
(37
)
 

 
(37
)
 
 Net cash provided (used) by financing activities
(155
)
 
(450
)
 
(605
)
 
 
 
 
 
 
 
 
Effect of foreign currency rates on cash
(23
)
 

 
(23
)
 
Net increase (decrease) in cash and cash equivalents
(112
)
 
(1,178
)
 
(1,290
)
 
Cash and cash equivalents at beginning of period
699
 
 
1,961

 
2,660

 
Cash and cash equivalents at end period
$
587

 
783

 
1,370

 
 
 
 
 
 
 
 
 

16


LIBERTY INTERACTIVE CORPORATION
STATEMENT OF CASH FLOWS INFORMATION
Three months ended March 31, 2012 - (unaudited)
 
Attributed
 
 
Interactive
Group
 
Ventures
Group
Consolidated Liberty
CASH FLOWS FROM OPERATING ACTIVITIES:
amounts in millions
Net earnings (loss)
$
133

 
(28
)
 
105
 
 
Adjustments to reconcile net earnings to net cash provided by operating activities:
 
 
 
 
Depreciation and amortization
143
 
 
 
 
143
 
 
Stock-based compensation
17
 
 
 
 
17
 
 
Share of losses (earnings) of affiliates, net
(13
)
 
2
 
 
(11
)
 
Realized and unrealized gains (losses) on financial instruments, net
(14
)
 
32
 
 
18
 
 
Deferred income tax (benefit) expense
(32
)
 
8
 
 
(24
)
 
Other, net
2
 
 
3
 
 
5
 
 
Intergroup tax allocation
44
 
 
(44
)
 
 
 
Changes in operating assets and liabilities
 
 
 
 
 
 
Current and other assets
268
 
 
 
 
268
 
 
Payables and other current liabilities
(170
)
 
(21
)
 
(191
)
 
Net cash provided (used) by operating activities
378
 
 
(48
)
 
330
 
 
 
 
 
 
 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
 
 
 
 
Investments in and loans to cost and equity investees
 
 
(45
)
 
(45
)
 
Capital expended for property and equipment
(68
)
 
 
 
(68
)
 
Net sales (purchases) of short term and other marketable securities
38
 
 
 
 
38
 
 
Other investing activities, net
(17
)
 
1
 
 
(16
)
 
Net cash provided (used) by investing activities
(47
)
 
(44
)
 
(91
)
 
 
 
 
 
 
 
 
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
 
 
 
Borrowings of debt
245
 
 
 
 
245
 
 
Repayments of debt
(272
)
 
(2
)
 
(274
)
 
Intergroup receipts (payments), net
(94
)
 
94
 
 
 
 
Repurchases of Liberty common stock
(228
)
 
 
 
(228
)
 
Other financing activities, net
(27
)
 
 
 
(27
)
 
Net cash provided (used) by financing activities
(376
)
 
92
 
 
(284
)
 
Effect of foreign currency rates on cash
(8
)
 
 
 
(8
)
 
Net increase (decrease) in cash and cash equivalents
(53
)
 
 
 
(53
)
 
Cash and cash equivalents at beginning of period
847
 
 
 
 
847
 
 
Cash and cash equivalents at end period
$
794
 
 
 
 
794
 
 
 
 
 
 
 
 
 
 



17