Exhibit 99.1

Unaudited Attributed Financial Information for Tracking Stock Groups

The following tables present our assets and liabilities as of March 31, 2015, revenue and expenses for the three months ended March 31, 2015 and 2014 and cash flows for the three months ended March 31, 2015 and 2014. The tables further present our assets, liabilities, revenue, expenses and cash flows that are attributed to the QVC Group and the Ventures Group, respectively.  The financial information in this Exhibit should be read in conjunction with our unaudited condensed consolidated financial statements for the 2015 included in this Quarterly Report on Form 10-Q.

As discussed in note 2 to the accompanying condensed consolidated financial statements, on October 3, 2014, the QVC Group (referred to as the “Interactive Group” prior to the reattribution) attributed to the Ventures Group its Digital Commerce companies (defined below), which were valued at $1.5 billion, and approximately $1 billion in cash. In return, Liberty Interactive common stock shareholders received a dividend of approximately 67.7 million shares of Liberty Ventures common stock, or 0.14217 of a Liberty Ventures share for each share of Liberty Interactive common stock outstanding on October 13, 2014, the record date of the dividend. The distribution date for the dividend was October 20, 2014, and the Liberty Interactive common stock began trading ex-dividend on October 15, 2014. The reattributed Digital Commerce companies were comprised of Liberty’s consolidated subsidiaries Backcountry.com, Bodybuilding.com, LLC, Provide Commerce, Inc. (“Provide”), CommerceHub, Evite.com and Right Start (collectively, the “Digital Commerce” companies). Following the reattribution, the name of the Interactive Group is now referred to as the QVC Group. Other than the issuance of Liberty Ventures shares in the fourth quarter of 2014, the reattribution had no consolidated impact on Liberty. The reattribution is reflected in Liberty’s condensed consolidated financial statements and attributed financial information on a prospective basis, with October 1, 2014 used as a proxy for the date of the reattribution.

Additionally, as discussed in note 2 and note 8 of the accompanying condensed consolidated financial statements, Liberty’s former wholly-owned subsidiary, Provide, was included in the Digital Commerce companies prior to the sale to FTD Companies, Inc. (“FTD”) on December 31, 2014, in exchange for cash and shares of FTD common stock representing approximately 35% of the combined company. Subsequent to this transaction, the Company’s interest in FTD, accounted for under the equity method, is included in the Digital Commerce companies. Given Liberty’s significant continuing involvement with FTD, Provide is not presented as a discontinued operation in the Company’s condensed consolidated financial statements.

As of March 31, 2015, our Liberty Interactive common stock is intended to reflect the separate performance of our QVC Group which, subsequent to the reattribution, is comprised of our consolidated subsidiary, QVC, Inc. (“QVC”) and our approximate 38% interest in HSN, Inc. As of March 31, 2015, our Liberty Ventures common stock is intended to reflect the separate performance of our Ventures Group which, subsequent to the reattribution, consists of our Digital Commerce businesses and our interests in equity method investments of Expedia, Inc., FTD, Interval Leisure Group, Inc. and LendingTree, Inc. and available-for-sale securities Time Warner Inc. and Time Warner Cable Inc.

Notwithstanding the following attribution of assets, liabilities, revenue, expenses and cash flows to the QVC Group and the Ventures Group, our tracking stock structure does not affect the ownership or the respective legal title to our assets or responsibility for our liabilities. We and our subsidiaries are each responsible for our respective liabilities. Holders of Liberty Interactive common stock and Liberty Ventures common stock are holders of our common stock and are subject to risks associated with an investment in our company and all of our businesses, assets and liabilities. The issuance of Liberty Interactive common stock and Liberty Ventures common stock does not affect the rights of our creditors or creditors of our subsidiaries.

 

 

 

 


 

 

SUMMARY ATTRIBUTED FINANCIAL DATA

QVC Group

 

 

 

 

 

 

 

 

 

 

March 31, 2015

 

December 31, 2014

 

 

 

amounts in millions

 

Summary balance sheet data:

    

 

 

    

    

 

Cash and cash equivalents

 

$

530 

 

422 

 

Trade and other receivables, net

 

$

836 

 

1,196 

 

Inventory

 

$

966 

 

882 

 

Investments in affiliates, accounted for using the equity method

 

$

193 

 

375 

 

Total assets

 

$

12,481 

 

13,012 

 

Long-term debt

 

$

5,740 

 

5,851 

 

Deferred income tax liabilities

 

$

936 

 

1,033 

 

Net assets attributable to Liberty Interactive common stock shareholders

 

$

4,231 

 

4,280 

 

 

 

 

 

 

 

 

 

 

 

Three months ended 

 

 

March 31,

 

 

2015

    

2014

 

 

amounts in millions

 

Summary operations data:

    

 

    

 

 

Revenue

$

1,938 

 

2,434 

 

Cost of sales

 

1,221 

 

1,556 

 

Operating expenses

 

169 

 

213 

 

Selling, general and administrative expenses (1)

 

159 

 

253 

 

Depreciation and amortization

 

152 

 

162 

 

Operating income (loss)

 

237 

 

250 

 

Interest expense

 

(75)

 

(76)

 

Share of earnings (losses) of affiliates, net

 

24 

 

21 

 

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

 

(10)

 

 

Other income (expense), net

 

 

 

Income tax benefit (expense)

 

(24)

 

(73)

 

Net earnings (loss) from continuing operations

 

160 

 

124 

 

Net earnings (loss) from discontinued operations

 

 —

 

(4)

 

Net earnings (loss)

 

160 

 

120 

 

Less net earnings (loss) attributable to noncontrolling interests

 

 

10 

 

Net earnings (loss) attributable to Liberty Interactive Corporation shareholders

$

151 

 

110 

 


(1)

Includes stock-based compensation of $12 million and $24 million for the three months ended March 31, 2015 and 2014, respectively.

 

2


 

 

SUMMARY ATTRIBUTED FINANCIAL DATA (Continued)

Ventures Group

 

 

 

 

 

 

 

 

 

March 31, 2015

 

December 31, 2014

 

 

 

amounts in millions

 

Summary balance sheet data:

    

 

    

    

    

 

Cash and cash equivalents

 

$

1,820 

 

1,884 

 

Investments in available-for-sale securities and other cost investments

 

$

1,232 

 

1,220 

 

Investments in affiliates, accounted for using the equity method

 

$

1,226 

 

1,258 

 

Total assets

 

$

5,726 

 

5,828 

 

Long-term debt, including current portion

 

$

2,172 

 

1,254 

 

Deferred income tax liabilities, including current portion

 

$

1,999 

 

1,987 

 

Net assets attributable to Liberty Ventures common stock shareholders

 

$

1,378 

 

1,393 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended 

 

 

 

March 31,

 

 

 

2015

 

2014

 

 

 

amounts in millions

 

Summary operations data:

    

 

    

    

    

 

Revenue

 

$

276 

 

 —

 

Cost of sales

 

 

194 

 

 —

 

Operating, including stock-based compensation

 

 

22 

 

 —

 

Selling, general and administrative expenses (1)

 

 

45 

 

 

Depreciation and amortization

 

 

16 

 

 

Operating income (loss)

 

 

(1)

 

(4)

 

Interest expense

 

 

(20)

 

(19)

 

Share of earnings (losses) of affiliates, net

 

 

(21)

 

(23)

 

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

 

 

 

(26)

 

Other, net

 

 

 

 

Income tax benefit (expense)

 

 

21 

 

33 

 

Net earnings (loss) from continuing operations

 

 

(8)

 

(33)

 

Net earnings (loss) from discontinued operations

 

 

 —

 

23 

 

Net earnings (loss)

 

 

(8)

 

(10)

 

Less net earnings (loss) attributable to noncontrolling interests

 

 

 —

 

18 

 

Net earnings (loss) attributable to Liberty Interactive Corporation shareholders

 

$

(8)

 

(28)

 

 


(1)

Includes stock-based compensation of $3 million and $1 million for the three months ended March 31, 2015 and 2014, respectively.

3


 

 

BALANCE SHEET INFORMATION

March 31, 2015 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Attributed (note 1)

 

 

 

 

 

 

    

QVC

    

Ventures

    

Inter-group

    

Consolidated

 

 

 

Group

 

Group

 

Eliminations

 

Liberty

 

 

 

amounts in millions

 

Assets

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

530 

 

1,820 

 

 

2,350 

 

Trade and other receivables, net

 

 

836 

 

31 

 

 

867 

 

Inventory, net

 

 

966 

 

153 

 

 

1,119 

 

Short-term marketable securities

 

 

 

851 

 

 

860 

 

Other current assets

 

 

269 

 

11 

 

(205)

 

75 

 

Total current assets

 

 

2,610 

 

2,866 

 

(205)

 

5,271 

 

Investments in available-for-sale securities and other cost investments (note 2)

 

 

 

1,232 

 

 

1,236 

 

Investments in affiliates, accounted for using the equity method (note 3)

 

 

193 

 

1,226 

 

 

1,419 

 

Property and equipment, net

 

 

971 

 

67 

 

 

1,038 

 

Intangible assets not subject to amortization

 

 

7,576 

 

268 

 

 

7,844 

 

Intangible assets subject to amortization, net

 

 

1,061 

 

61 

 

 

1,122 

 

Other assets, at cost, net of accumulated amortization

 

 

66 

 

 

 

72 

 

Total assets

 

$

12,481 

 

5,726 

 

(205)

 

18,002 

 

Liabilities and Equity

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

Intergroup payable (receivable) (note 7)

 

$

47 

 

(47)

 

 

 —

 

Accounts payable

 

 

554 

 

85 

 

 

639 

 

Accrued liabilities

 

 

543 

 

48 

 

 

591 

 

Current portion of debt (note 4)

 

 

 

931 

 

 

939 

 

Current deferred tax liabilities

 

 

 —

 

1,196 

 

(205)

 

991 

 

Other current liabilities

 

 

163 

 

73 

 

 

236 

 

Total current liabilities

 

 

1,315 

 

2,286 

 

(205)

 

3,396 

 

Long-term debt (note 4)

 

 

5,740 

 

1,241 

 

 

6,981 

 

Deferred income tax liabilities

 

 

936 

 

803 

 

 

1,739 

 

Other liabilities

 

 

169 

 

12 

 

 

181 

 

Total liabilities

 

 

8,160 

 

4,342 

 

(205)

 

12,297 

 

Equity/Attributed net assets (liabilities)

 

 

4,231 

 

1,378 

 

 

5,609 

 

Noncontrolling interests in equity of subsidiaries

 

 

90 

 

 

 

96 

 

Total liabilities and equity

 

$

12,481 

 

5,726 

 

(205)

 

18,002 

 

 

 

 

 

 

 

 

 

 

 

 

 

4


 

 

 

STATEMENT OF OPERATIONS INFORMATION

Three months ended March 31, 2015 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Attributed (note 1)

 

 

 

 

 

QVC

 

Ventures

 

Consolidated

 

 

 

Group

 

Group

 

Liberty

 

 

 

amounts in millions

 

Net retail sales

 

$

1,938 

 

276 

 

2,214 

 

 

 

 

 

 

 

 

 

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

Cost of sales

 

 

1,221 

 

194 

 

1,415 

 

Operating, including stock-based compensation (note 5)

 

 

169 

 

22 

 

191 

 

Selling, general and administrative, including stock-based compensation (note 5)

 

 

159 

 

45 

 

204 

 

Depreciation and amortization

 

 

152 

 

16 

 

168 

 

 

 

 

1,701 

 

277 

 

1,978 

 

Operating income (loss)

 

 

237 

 

(1)

 

236 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Interest expense

 

 

(75)

 

(20)

 

(95)

 

Share of earnings (losses) of affiliates, net (note 3)

 

 

24 

 

(21)

 

 

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

 

 

(10)

 

 

(4)

 

Other, net

 

 

 

 

15 

 

 

 

 

(53)

 

(28)

 

(81)

 

Earnings (loss) before income taxes

 

 

184 

 

(29)

 

155 

 

Income tax benefit (expense)

 

 

(24)

 

21 

 

(3)

 

Net earnings (loss)

 

 

160 

 

(8)

 

152 

 

Less net earnings (loss) attributable to noncontrolling interests

 

 

 

 —

 

 

Net earnings (loss) attributable to Liberty stockholders

 

$

151 

 

(8)

 

143 

 

 

    

 

 

    

 

    

 

 

 

 

 

 

5


 

 

 

STATEMENT OF OPERATIONS INFORMATION

Three months ended March 31, 2014 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Attributed (note 1)

 

 

 

 

    

QVC

    

Ventures

    

Consolidated

 

 

 

Group

 

Group

 

Liberty

 

 

 

amounts in millions

 

Net retail sales

 

$

2,434 

 

 —

 

2,434 

 

 

 

 

 

 

 

 

 

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

Cost of sales

 

 

1,556 

 

 —

 

1,556 

 

Operating, including stock-based compensation

 

 

213 

 

 —

 

213 

 

Selling, general and administrative, including stock-based compensation (note 5)

 

 

253 

 

 

256 

 

Depreciation and amortization

 

 

162 

 

 

163 

 

 

 

 

2,184 

 

 

2,188 

 

Operating income (loss)

 

 

250 

 

(4)

 

246 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Interest expense

 

 

(76)

 

(19)

 

(95)

 

Share of earnings (losses) of affiliates, net (note 3)

 

 

21 

 

(23)

 

(2)

 

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

 

 

 

(26)

 

(25)

 

Other, net

 

 

 

 

 

 

 

 

(53)

 

(62)

 

(115)

 

Earnings (loss) from continuing operations before income taxes

 

 

197 

 

(66)

 

131 

 

Income tax benefit (expense)

 

 

(73)

 

33 

 

(40)

 

Net earnings (loss) from continuing operations

 

 

124 

 

(33)

 

91 

 

Earnings (loss) from discontinued operations, net of taxes

 

 

(4)

 

23 

 

19 

 

Net earnings (loss)

 

 

120 

 

(10)

 

110 

 

Less net earnings (loss) attributable to noncontrolling interests

 

 

10 

 

18 

 

28 

 

Net earnings (loss) attributable to Liberty stockholders

 

$

110 

 

(28)

 

82 

 

 

 

 

 

 

 

6


 

 

STATEMENT OF CASH FLOWS INFORMATION

Three months ended March 31, 2015 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Attributed (note 1)

 

 

 

 

    

QVC

    

Ventures

    

Consolidated

 

 

 

Group

 

Group

 

Liberty

 

 

 

amounts in millions

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net earnings (loss)

 

$

160 

 

(8)

 

152 

 

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

152 

 

16 

 

168 

 

Stock-based compensation

 

 

12 

 

 

15 

 

Cash payments for stock based compensation

 

 

 —

 

(2)

 

(2)

 

Excess tax benefit from stock based compensation

 

 

(13)

 

 —

 

(13)

 

Share of (earnings) losses of affiliates, net

 

 

(24)

 

21 

 

(3)

 

Cash receipts from return on equity investments

 

 

 

 

13 

 

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

 

 

10 

 

(6)

 

 

Deferred income tax (benefit) expense

 

 

(79)

 

25 

 

(54)

 

Other, net

 

 

(9)

 

 

(8)

 

Intergroup tax allocation

 

 

47 

 

(47)

 

 —

 

Intergroup tax (payments) receipts

 

 

(6)

 

 

 —

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Current and other assets

 

 

238 

 

20 

 

258 

 

Payables and other current liabilities

 

 

(268)

 

(42)

 

(310)

 

Net cash provided (used) by operating activities

 

 

227 

 

(7)

 

220 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Cash paid for acquisitions

 

 

 —

 

(20)

 

(20)

 

Investments in and loans to cost and equity investees

 

 

(1)

 

(44)

 

(45)

 

Cash receipts from returns of equity investments

 

 

200 

 

 —

 

200 

 

Capital expended for property and equipment

 

 

(31)

 

(13)

 

(44)

 

Purchases of short term and other marketable securities

 

 

(54)

 

(233)

 

(287)

 

Sales of short term and other marketable securities

 

 

66 

 

247 

 

313 

 

Other investing activities, net

 

 

(44)

 

 —

 

(44)

 

Net cash provided (used) by investing activities

 

 

136 

 

(63)

 

73 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Borrowings of debt

 

 

351 

 

180 

 

531 

 

Repayments of debt

 

 

(466)

 

(176)

 

(642)

 

Repurchases of Liberty common stock

 

 

(123)

 

 —

 

(123)

 

Minimum withholding taxes on net settlements of stock-based compensation

 

 

(12)

 

 

(11)

 

Excess tax benefit from stock-based compensation

 

 

13 

 

 —

 

13 

 

Other financing activities, net

 

 

(8)

 

 

(7)

 

Net cash provided (used) by financing activities

 

 

(245)

 

 

(239)

 

Effect of foreign currency rates on cash

 

 

(10)

 

 —

 

(10)

 

Net increase (decrease) in cash and cash equivalents

 

 

108 

 

(64)

 

44 

 

Cash and cash equivalents at beginning of period

 

 

422 

 

1,884 

 

2,306 

 

Cash and cash equivalents at end period

 

$

530 

 

1,820 

 

2,350 

 

 

 

 

 

 

 

 

 

 

7


 

 

 

STATEMENT OF CASH FLOWS INFORMATION

Three months ended March 31, 2014 

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Attributed (note 1)

 

 

 

 

    

QVC

    

Ventures

    

Consolidated

 

 

 

Group

 

Group

 

Liberty

 

 

 

amounts in millions

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net earnings (loss)

 

$

120 

 

(10)

 

110 

 

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

 

 

 

(Earnings) loss from discontinued operations

 

 

 

(23)

 

(19)

 

Depreciation and amortization

 

 

162 

 

 

163 

 

Stock-based compensation

 

 

24 

 

 

25 

 

Cash payments for stock based compensation

 

 

(3)

 

(1)

 

(4)

 

Excess tax benefit from stock-based compensation

 

 

(8)

 

 —

 

(8)

 

Share of losses (earnings) of affiliates, net

 

 

(21)

 

23 

 

 

Cash receipts from return on equity investments

 

 

 

 

10 

 

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

 

 

(1)

 

26 

 

25 

 

Deferred income tax (benefit) expense

 

 

(49)

 

17 

 

(32)

 

Other, net

 

 

 

(1)

 

 —

 

Intergroup tax allocation

 

 

50 

 

(50)

 

 —

 

Intergroup tax (payments) receipts

 

 

(225)

 

225 

 

 —

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Current and other assets

 

 

175 

 

 

176 

 

Payables and other current liabilities

 

 

(54)

 

 

(51)

 

Net cash provided (used) by operating activities

 

 

180 

 

217 

 

397 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Cash proceeds from dispositions

 

 

 —

 

25 

 

25 

 

Investments in and loans to cost and equity investees

 

 

 —

 

(18)

 

(18)

 

Capital expended for property and equipment

 

 

(41)

 

 —

 

(41)

 

Purchases of short term and other marketable securities

 

 

 —

 

(106)

 

(106)

 

Sales of short term and other marketable securities

 

 

 —

 

68 

 

68 

 

Other investing activities, net

 

 

(9)

 

 

(8)

 

Net cash provided (used) by investing activities

 

 

(50)

 

(30)

 

(80)

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Borrowings of debt

 

 

1,551 

 

 —

 

1,551 

 

Repayments of debt

 

 

(1,347)

 

(5)

 

(1,352)

 

Repurchases of Liberty Interactive common stock

 

 

(213)

 

 —

 

(213)

 

Minimum withholding taxes on net settlements of stock-based compensation

 

 

(6)

 

(2)

 

(8)

 

Excess tax benefit from stock-based compensation

 

 

 

 —

 

 

Intergroup receipts (payments), net

 

 

 

(2)

 

 —

 

Other financing activities, net

 

 

(35)

 

(2)

 

(37)

 

Net cash provided (used) by financing activities

 

 

(40)

 

(11)

 

(51)

 

Net cash provided (used) by discontinued operations:

 

 

 

 

 

 

 

 

Operating

 

 

(6)

 

135 

 

129 

 

Investing

 

 

(1)

 

(153)

 

(154)

 

Financing

 

 

 —

 

(13)

 

(13)

 

Change in available cash held by discontinued operations

 

 

 

31 

 

32 

 

Net cash provided (used) by discontinued operations

 

 

(6)

 

 —

 

(6)

 

Effect of foreign currency rates on cash

 

 

 —

 

 —

 

 —

 

Net increase (decrease) in cash and cash equivalents

 

 

84 

 

176 

 

260 

 

Cash and cash equivalents at beginning of period

 

 

595 

 

307 

 

902 

 

Cash and cash equivalents at end period

 

$

679 

 

483 

 

1,162 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8


 

Notes to Attributed Financial Information

(unaudited)

 

 

(1)

At March 31, 2015, the QVC Group is comprised of our consolidated subsidiary, QVC, and our approximate 38% interest in HSN, Inc., accounted for under the equity method.  Accordingly, the accompanying attributed financial information for the QVC Group includes the foregoing investment, as well as the assets, liabilities, revenue, expenses and cash flows of QVC.  We have also attributed certain of our debt obligations (and related interest expense) to the QVC Group based upon a number of factors, including the cash flow available to the QVC Group and its ability to pay debt service and our assessment of the optimal capitalization for the QVC Group.  The specific debt obligations attributed to each of the QVC Group and the Ventures Group are described in note 4 below.  In addition, we have allocated certain corporate general and administrative expenses among the QVC Group and the Ventures Group as described in note 5 below.

 

At March 31, 2015,  the QVC Group is primarily focused on our merchandise-focused televised shopping programs, Internet and mobile application businesses.  Accordingly, we expect that businesses that we may acquire in the future that we believe are complementary to this strategy will also be attributed to the QVC Group.

 

At March 31, 2015, the Ventures Group consists of all of our businesses not included in the QVC Group including our Digital Commerce businesses and interests in equity method investments of Expedia, Inc., Interval Leisure Group, Inc., FTD and LendingTree, Inc. and available-for-sale securities Time Warner Inc. and Time Warner Cable Inc.  Accordingly, the accompanying attributed financial information for the Ventures Group includes these investments as well as the assets, liabilities, revenue, expenses and cash flows of the Digital Commerce businesses. In addition, we have attributed to the Ventures Group all of our senior exchangeable debentures (and related interest expense).  See note 4 below for the debt obligations attributed to the Ventures Group.

 

Any businesses that we may acquire in the future that we do not attribute to the QVC Group will be attributed to the Ventures Group.

 

(2)

Investments in available-for-sale securities, including non-strategic securities, and other cost investments are summarized as follows:

 

 

 

 

 

 

 

 

 

    

March 31,

    

December 31,

 

 

 

2015

 

2014

 

 

 

amounts in millions

 

QVC Group

 

 

 

 

 

 

Other

 

$

 

 

Total QVC Group

 

 

 

 

Ventures Group

 

 

 

 

 

 

Time Warner Inc.

 

 

371 

 

375 

 

Time Warner Cable Inc.

 

 

803 

 

815 

 

Other

 

 

58 

 

30 

 

Total Ventures Group

 

 

1,232 

 

1,220 

 

Consolidated Liberty

 

$

1,236 

 

1,224 

 

 

9


 

Notes to Attributed Financial Information

(unaudited)

 

 

 

(3)

The following table presents information regarding certain equity method investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share of earnings (losses)

 

 

 

March 31, 2015

 

Three months ended

 

 

 

Percentage

 

Carrying

 

Market

 

March 31,

 

 

 

ownership

    

value

 

value

 

2015

 

2014

 

 

 

dollar amounts in millions

 

QVC Group

    

    

  

    

 

    

    

    

    

    

  

    

 

HSN, Inc.

 

38 

%  

 

$

146 

 

1,366 

 

25 

 

22 

 

Other

 

various

 

 

 

47 

 

NA

 

(1)

 

(1)

 

Total QVC Group

 

 

 

 

 

193 

 

 

 

24 

 

21 

 

Ventures Group

 

 

 

 

 

 

 

 

 

 

 

 

 

Expedia, Inc.

 

18 

%  

 

 

496 

 

2,197 

 

 

(6)

 

FTD (1)

 

35 

%  

 

 

350 

 

305 

 

(2)

 

NA

 

Other

 

various

 

 

 

380 

 

NA

 

(23)

 

(17)

 

Total Ventures Group

 

 

 

 

 

1,226 

 

 

 

(21)

 

(23)

 

Consolidated Liberty

 

 

 

 

$

1,419 

 

 

 

 

(2)

 

(1)

As previously discussed, on December 31, 2014, Liberty announced the closing of the acquisition by FTD of Provide, which was one of Liberty’s wholly-owned Digital Commerce businesses. Under the terms of the transaction, Liberty received approximately 10.2 million shares of FTD common stock representing approximately 35% of the combined company and approximately $145 million in cash. Subsequent to completion of the transaction, Liberty accounts for FTD as an equity-method affiliate based on the ownership level and board representation.

10


 

Notes to Attributed Financial Information

(unaudited)

 

 

(4)

Debt attributed to the QVC Group and the Ventures Group is comprised of the following:

 

 

 

 

 

 

 

 

 

 

 

March 31, 2015

 

 

 

Outstanding

 

Carrying

 

 

 

principal

 

value

 

 

 

amounts in millions

 

QVC Group

    

 

    

    

 

    

 

8.5% Senior Debentures due 2029

 

$

287 

 

 

285 

 

8.25% Senior Debentures due 2030

 

 

504 

 

 

501 

 

1% Exchangeable Senior Debentures due 2043

 

 

346 

 

 

400 

 

QVC 3.125% Senior Secured Notes due 2019

 

 

400 

 

 

399 

 

QVC 7.375% Senior Secured Notes due 2020

 

 

500 

 

 

500 

 

QVC 5.125% Senior Secured Notes due 2022

 

 

500 

 

 

500 

 

QVC 4.375% Senior Secured Notes due 2023

 

 

750 

 

 

750 

 

QVC 4.850% Senior Secured Notes due 2024

 

 

600 

 

 

600 

 

QVC 4.45% Senior Secured Notes due 2025

 

 

600 

 

 

599 

 

QVC 5.45% Senior Secured Notes due 2034

 

 

400 

 

 

399 

 

QVC 5.95% Senior Secured Notes due 2043

 

 

300 

 

 

300 

 

QVC Bank Credit Facilities

 

 

450 

 

 

450 

 

Other subsidiary debt

 

 

65 

 

 

65 

 

Total QVC Group debt

 

 

5,702 

 

 

5,748 

 

Ventures Group

 

 

 

 

 

 

 

4% Exchangeable Senior Debentures due 2029

 

 

438 

 

 

292 

 

3.75% Exchangeable Senior Debentures due 2030

 

 

438 

 

 

293 

 

3.5% Exchangeable Senior Debentures due 2031

 

 

351 

 

 

331 

 

0.75% Exchangeable Senior Debentures due 2043

 

 

850 

 

 

1,186 

 

Subsidiary level notes and facilities

 

 

70 

 

 

70 

 

Total Ventures Group debt

 

 

2,147 

 

 

2,172 

 

Total consolidated Liberty debt

 

$

7,849 

 

 

7,920 

 

Less current maturities

 

 

 

 

 

(939)

 

Total long-term debt

 

 

 

 

$

6,981 

 

 

(5)

Cash compensation expense for our corporate employees is allocated between the QVC Group and the Ventures Group based on the estimated percentage of time spent providing services for each group.  On a semi-annual basis, estimated time spent will be determined through an interview process and a review of personnel duties unless transactions significantly change the composition of companies and investments in either respective group, which would require a more timely reevaluation of estimated time spent.  Other general and administrative expenses will be charged directly to the groups whenever possible and are otherwise allocated based on estimated usage or some other reasonably determined methodology.  Amounts allocated from the QVC Group to the Ventures Group were determined to be $4 million and $2 million for the three months ended March 31, 2015 and 2014, respectively.  We note that stock compensation related to each tracking stock group is determined based on actual options outstanding for each respective tracking stock group.

While we believe that this allocation method is reasonable and fair to each group, we may elect to change the allocation methodology or percentages used to allocate general and administrative expenses in the future.

(6)

The Liberty Interactive common stock and the Liberty Ventures common stock have voting and conversion rights under our restated charter.  Following is a summary of those rights.  Holders of Series A common stock of each

11


 

Notes to Attributed Financial Information

(unaudited)

 

group are entitled to one vote per share, and holders of Series B common stock of each group are entitled to ten votes per share.  Holders of Series C common stock of each group, if issued, are entitled to 1/100th of a vote per share in certain limited cases and will otherwise not be entitled to vote.  In general, holders of Series A and Series B common stock will vote as a single class. In certain limited circumstances, the board may elect to seek the approval of the holders of only Series A and Series B Liberty Interactive common stock or the approval of the holders of only Series A and Series B Liberty Ventures common stock.

At the option of the holder, each share of Series B common stock will be convertible into one share of Series A common stock of the same group.  At the discretion of our board, the common stock related to one group may be converted into common stock of the same series that is related to the other group.

(7)The intergroup payable (receivable) is primarily attributable to an allocation of intergroup income taxes payable from the QVC Group to the Ventures Group.

 

12