| Guarantor/Non-guarantor Subsidiary Financial Information |
(19) Guarantor/Non-guarantor Subsidiary Financial Information
The following information contains the consolidating financial statements for the Company, the parent on a stand-alone basis (QVC, Inc.), the combined subsidiary guarantors (Affiliate Relations Holdings, Inc.; Affiliate Investment, Inc.; AMI 2, Inc.; ER Marks, Inc.; QVC International LLC; QVC Rocky Mount, Inc. and QVC San Antonio, LLC) and the combined non-guarantor subsidiaries pursuant to Rule 3-10 of Regulation S-X. Certain non-guarantor subsidiaries are majority-owned by QVC International LLC, which is a guarantor subsidiary.
These consolidating financial statements have been prepared from the Company's financial information on the same basis of accounting as the Company's consolidated financial statements. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions, such as management fees, royalty revenue and expense and interest income and expense. Goodwill and other intangible assets have been allocated to the subsidiaries based on management’s estimates. Certain costs have been partially allocated to all of the subsidiaries of the Company.
The subsidiary guarantors are 100% owned by the Company. All guarantees are full and unconditional and are joint and several. There are no significant restrictions on the ability of the Company to obtain funds from its U.S. subsidiaries, including the guarantors, by dividend or loan. The Company has not presented separate notes and other disclosures concerning the subsidiary guarantors as the Company has determined that such material information is available in the notes to the Company's consolidated financial statements.
The Company adjusted the previously reported consolidating financial statements to correctly classify transactions among QVC Inc., the combined subsidiary guarantors and the combined non-guarantor subsidiaries.
The adjustments to the consolidating balance sheets:
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• |
increased intercompany accounts receivable of the combined non-guarantor subsidiaries by $650 million and increased intercompany accounts payable of QVC, Inc. by $1,055 million related to cumulative revenue net of cumulative cost of goods sold and cumulative operating expenses, which have been attributed from QVC, Inc. to the combined non-guarantor subsidiaries as of December 31, 2012; and
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• |
increased shareholder’s equity for the combined subsidiary guarantors by $405 million and combined non-guarantor subsidiaries by $650 million with an equal and offsetting increase in the investment in subsidiaries of QVC, Inc. and its corresponding elimination as of December 31, 2012.
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The adjustments to the consolidating statements of operations:
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• |
attributed $231 million and $199 million of revenue, $69 million and $73 million of cost of goods sold and $33 million and $25 million in operating expenses for the years ended 2012 and 2011, respectively, from QVC, Inc. to the combined non-guarantor subsidiaries and recognized equal and offsetting increases in the equity in earnings of subsidiaries of QVC, Inc.; and
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• |
recognized $63 million and $52 million for the years ended 2012 and 2011, respectively, in net income attributable to noncontrolling interests of QVC, Inc. and eliminated that income in consolidation.
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The adjustments to the condensed consolidating statements of cash flows:
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• |
attributed net cash provided by operating activities from QVC, Inc. to the combined non-guarantor subsidiaries primarily related to revenue net of cost of goods sold and operating expenses of $156 million and $103 million for the years ended 2012 and 2011, respectively;
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• |
increased net cash provided by the investing activities of QVC, Inc. of $101 million for the year ended 2012, decreased net cash used in the investing activities of QVC, Inc. of $37 million for the year ended 2011 and increased net cash provided by the investing activities of the combined subsidiary guarantors of $49 million for the year ended 2012, all with equal and offsetting eliminations; and
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• |
increased net cash provided by the financing activities of QVC, Inc. of $55 million and $140 million for the years ended 2012 and 2011, respectively, decreased net cash used in the financing activities of the combined subsidiary guarantors of $48 million for the year ended 2012 and decreased net cash used in the financing activities of the non-guarantor subsidiaries of $152 million and $106 million for the years ended 2012 and 2011, respectively, all with equal and offsetting eliminations.
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The adjustments had no impact to the Company's consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income, consolidated statements of changes in equity or consolidated statements of cash flows for any current and previously reported period.
The effect of the adjustment on equity as of January 1, 2012 was as follows:
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|
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|
|
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|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
As previously reported |
$ |
7,890 |
|
3,465 |
|
1,716 |
|
(5,052 |
) |
8,019 |
|
Adjustment |
— |
|
450 |
|
465 |
|
(915 |
) |
— |
|
Adjusted |
$ |
7,890 |
|
3,915 |
|
2,181 |
|
(5,967 |
) |
8,019 |
|
Consolidating balance sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Assets |
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
78 |
|
133 |
|
246 |
|
— |
|
457 |
|
Restricted cash |
11 |
|
— |
|
3 |
|
— |
|
14 |
|
Accounts receivable, net |
816 |
|
— |
|
295 |
|
— |
|
1,111 |
|
Inventories |
684 |
|
— |
|
247 |
|
— |
|
931 |
|
Deferred income taxes |
146 |
|
— |
|
16 |
|
— |
|
162 |
|
Prepaid expenses |
20 |
|
— |
|
27 |
|
— |
|
47 |
|
Total current assets |
1,755 |
|
133 |
|
834 |
|
— |
|
2,722 |
|
Property, plant and equipment, net |
265 |
|
67 |
|
774 |
|
— |
|
1,106 |
|
Cable and satellite television distribution rights, net |
— |
|
510 |
|
114 |
|
— |
|
624 |
|
Goodwill |
4,169 |
|
— |
|
1,028 |
|
— |
|
5,197 |
|
Other intangible assets, net |
1,128 |
|
2,050 |
|
158 |
|
— |
|
3,336 |
|
Other noncurrent assets |
8 |
|
— |
|
63 |
|
— |
|
71 |
|
Investments in subsidiaries |
4,894 |
|
1,628 |
|
— |
|
(6,522 |
) |
— |
|
Total assets |
$ |
12,219 |
|
4,388 |
|
2,971 |
|
(6,522 |
) |
13,056 |
|
Liabilities and equity |
Current liabilities: |
|
|
|
|
|
Current portion of debt and capital lease obligations |
$ |
2 |
|
— |
|
11 |
|
— |
|
13 |
|
Accounts payable-trade |
266 |
|
— |
|
159 |
|
— |
|
425 |
|
Accrued liabilities |
463 |
|
96 |
|
470 |
|
— |
|
1,029 |
|
Intercompany accounts payable (receivable) |
1,019 |
|
(879 |
) |
(140 |
) |
— |
|
— |
|
Total current liabilities |
1,750 |
|
(783 |
) |
500 |
|
— |
|
1,467 |
|
Long-term portion of debt and capital lease obligations |
3,745 |
|
— |
|
55 |
|
— |
|
3,800 |
|
Deferred compensation |
13 |
|
— |
|
1 |
|
— |
|
14 |
|
Deferred income taxes |
399 |
|
923 |
|
4 |
|
— |
|
1,326 |
|
Other long-term liabilities |
90 |
|
— |
|
18 |
|
— |
|
108 |
|
Total liabilities |
5,997 |
|
140 |
|
578 |
|
— |
|
6,715 |
|
Equity: |
|
|
|
|
|
QVC, Inc. shareholder's equity |
6,222 |
|
4,248 |
|
2,274 |
|
(6,522 |
) |
6,222 |
|
Noncontrolling interest |
— |
|
— |
|
119 |
|
— |
|
119 |
|
Total equity |
6,222 |
|
4,248 |
|
2,393 |
|
(6,522 |
) |
6,341 |
|
Total liabilities and equity |
$ |
12,219 |
|
4,388 |
|
2,971 |
|
(6,522 |
) |
13,056 |
|
Consolidating balance sheets - Adjusted
|
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|
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December 31, 2012 |
|
(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 |
$ |
75 |
|
165 |
|
300 |
|
— |
|
540 |
|
Restricted cash |
13 |
|
— |
|
2 |
|
— |
|
15 |
|
Accounts receivable, net |
747 |
|
— |
|
308 |
|
— |
|
1,055 |
|
Inventories |
691 |
|
— |
|
218 |
|
— |
|
909 |
|
Deferred income taxes |
131 |
|
— |
|
20 |
|
— |
|
151 |
|
Prepaid expenses |
19 |
|
— |
|
34 |
|
— |
|
53 |
|
Total current assets |
1,676 |
|
165 |
|
882 |
|
— |
|
2,723 |
|
Property, plant and equipment, net |
247 |
|
67 |
|
817 |
|
— |
|
1,131 |
|
Cable and satellite television distribution rights, net |
— |
|
618 |
|
146 |
|
— |
|
764 |
|
Goodwill |
4,169 |
|
— |
|
1,065 |
|
— |
|
5,234 |
|
Other intangible assets, net |
1,280 |
|
2,049 |
|
180 |
|
— |
|
3,509 |
|
Other noncurrent assets |
14 |
|
— |
|
63 |
|
— |
|
77 |
|
Investments in subsidiaries |
4,844 |
|
1,838 |
|
— |
|
(6,682 |
) |
— |
|
Total assets |
$ |
12,230 |
|
4,737 |
|
3,153 |
|
(6,682 |
) |
13,438 |
|
Liabilities and equity |
Current liabilities: |
|
|
|
|
|
Current portion of debt and capital lease obligations |
$ |
2 |
|
— |
|
10 |
|
— |
|
12 |
|
Accounts payable-trade |
324 |
|
— |
|
242 |
|
— |
|
566 |
|
Accrued liabilities |
402 |
|
106 |
|
447 |
|
— |
|
955 |
|
Intercompany accounts payable (receivable) |
829 |
|
(816 |
) |
(13 |
) |
— |
|
— |
|
Total current liabilities |
1,557 |
|
(710 |
) |
686 |
|
— |
|
1,533 |
|
Long-term portion of debt and capital lease obligations |
3,404 |
|
— |
|
61 |
|
— |
|
3,465 |
|
Deferred compensation |
11 |
|
— |
|
1 |
|
— |
|
12 |
|
Deferred income taxes |
431 |
|
964 |
|
15 |
|
— |
|
1,410 |
|
Other long-term liabilities |
137 |
|
17 |
|
30 |
|
— |
|
184 |
|
Total liabilities |
5,540 |
|
271 |
|
793 |
|
— |
|
6,604 |
|
Equity: |
|
|
|
|
|
QVC, Inc. shareholder's equity |
6,690 |
|
4,466 |
|
2,216 |
|
(6,682 |
) |
6,690 |
|
Noncontrolling interest |
— |
|
— |
|
144 |
|
— |
|
144 |
|
Total equity |
6,690 |
|
4,466 |
|
2,360 |
|
(6,682 |
) |
6,834 |
|
Total liabilities and equity |
$ |
12,230 |
|
4,737 |
|
3,153 |
|
(6,682 |
) |
13,438 |
|
Consolidating statements of operations
|
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Year ended December, 2013 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
5,914 |
|
841 |
|
2,914 |
|
(1,046 |
) |
8,623 |
|
Cost of goods sold |
3,804 |
|
107 |
|
1,831 |
|
(277 |
) |
5,465 |
|
Gross profit |
2,110 |
|
734 |
|
1,083 |
|
(769 |
) |
3,158 |
|
Operating expenses: |
|
|
|
|
|
Operating |
168 |
|
214 |
|
358 |
|
— |
|
740 |
|
Selling, general and administrative, including stock-based compensation |
1,028 |
|
— |
|
356 |
|
(769 |
) |
615 |
|
Depreciation |
38 |
|
6 |
|
83 |
|
— |
|
127 |
|
Amortization of intangible assets |
204 |
|
146 |
|
81 |
|
— |
|
431 |
|
Intercompany management expense (income) |
50 |
|
1 |
|
(51 |
) |
— |
|
— |
|
|
1,488 |
|
367 |
|
827 |
|
(769 |
) |
1,913 |
|
Operating income |
622 |
|
367 |
|
256 |
|
— |
|
1,245 |
|
Other (expense) income: |
|
|
|
|
|
Equity in losses of investee |
— |
|
— |
|
(4 |
) |
— |
|
(4 |
) |
Gains on financial instruments |
12 |
|
— |
|
3 |
|
— |
|
15 |
|
Interest expense, net |
(214 |
) |
— |
|
— |
|
— |
|
(214 |
) |
Foreign currency (loss) gain |
(13 |
) |
— |
|
14 |
|
— |
|
1 |
|
Loss on extinguishment of debt |
(57 |
) |
— |
|
— |
|
— |
|
(57 |
) |
Intercompany interest (expense) income |
(16 |
) |
51 |
|
(35 |
) |
— |
|
— |
|
|
(288 |
) |
51 |
|
(22 |
) |
— |
|
(259 |
) |
Income before income taxes |
334 |
|
418 |
|
234 |
|
— |
|
986 |
|
Income tax expense |
(119 |
) |
(132 |
) |
(102 |
) |
— |
|
(353 |
) |
Equity in earnings of subsidiaries, net of tax |
418 |
|
67 |
|
— |
|
(485 |
) |
— |
|
Net income |
633 |
|
353 |
|
132 |
|
(485 |
) |
633 |
|
Less net income attributable to the noncontrolling interest |
(45 |
) |
— |
|
(45 |
) |
45 |
|
(45 |
) |
Net income attributable to QVC, Inc. shareholder |
$ |
588 |
|
353 |
|
87 |
|
(440 |
) |
588 |
|
Consolidating statements of operations - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2012 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
5,653 |
|
819 |
|
3,078 |
|
(1,034 |
) |
8,516 |
|
Cost of goods sold |
3,644 |
|
116 |
|
1,941 |
|
(282 |
) |
5,419 |
|
Gross profit |
2,009 |
|
703 |
|
1,137 |
|
(752 |
) |
3,097 |
|
Operating expenses: |
|
|
|
|
|
Operating |
140 |
|
206 |
|
369 |
|
— |
|
715 |
|
Selling, general and administrative, including stock-based compensation |
1,002 |
|
1 |
|
337 |
|
(752 |
) |
588 |
|
Depreciation |
35 |
|
4 |
|
87 |
|
— |
|
126 |
|
Amortization of intangible assets |
204 |
|
130 |
|
66 |
|
— |
|
400 |
|
Intercompany management expense (income) |
60 |
|
(14 |
) |
(46 |
) |
— |
|
— |
|
|
1,441 |
|
327 |
|
813 |
|
(752 |
) |
1,829 |
|
Operating income |
568 |
|
376 |
|
324 |
|
— |
|
1,268 |
|
Other (expense) income: |
|
|
|
|
|
Equity in losses of investee |
— |
|
— |
|
(4 |
) |
— |
|
(4 |
) |
Gains on financial instruments |
48 |
|
— |
|
— |
|
— |
|
48 |
|
Interest expense, net |
(233 |
) |
— |
|
— |
|
— |
|
(233 |
) |
Foreign currency (loss) gain |
(10 |
) |
4 |
|
8 |
|
— |
|
2 |
|
Intercompany interest (expense) income |
(13 |
) |
51 |
|
(38 |
) |
— |
|
— |
|
|
(208 |
) |
55 |
|
(34 |
) |
— |
|
(187 |
) |
Income before income taxes |
360 |
|
431 |
|
290 |
|
— |
|
1,081 |
|
Income tax expense |
(116 |
) |
(141 |
) |
(137 |
) |
— |
|
(394 |
) |
Equity in earnings of subsidiaries, net of tax |
443 |
|
93 |
|
— |
|
(536 |
) |
— |
|
Net income |
687 |
|
383 |
|
153 |
|
(536 |
) |
687 |
|
Less net income attributable to the noncontrolling interest |
(63 |
) |
— |
|
(63 |
) |
63 |
|
(63 |
) |
Net income attributable to QVC, Inc. shareholder |
$ |
624 |
|
383 |
|
90 |
|
(473 |
) |
624 |
|
Consolidating statements of operations - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2011 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
5,485 |
|
790 |
|
2,988 |
|
(995 |
) |
8,268 |
|
Cost of goods sold |
3,507 |
|
120 |
|
1,906 |
|
(255 |
) |
5,278 |
|
Gross profit |
1,978 |
|
670 |
|
1,082 |
|
(740 |
) |
2,990 |
|
Operating expenses: |
|
|
|
|
|
Operating |
166 |
|
201 |
|
377 |
|
— |
|
744 |
|
Selling, general and administrative, including stock-based compensation |
947 |
|
— |
|
328 |
|
(740 |
) |
535 |
|
Depreciation |
36 |
|
4 |
|
95 |
|
— |
|
135 |
|
Amortization of intangible assets |
242 |
|
133 |
|
64 |
|
— |
|
439 |
|
Intercompany management expense (income) |
89 |
|
(27 |
) |
(62 |
) |
— |
|
— |
|
|
1,480 |
|
311 |
|
802 |
|
(740 |
) |
1,853 |
|
Operating income |
498 |
|
359 |
|
280 |
|
— |
|
1,137 |
|
Other (expense) income: |
|
|
|
|
|
Equity in losses of investee |
— |
|
— |
|
(2 |
) |
— |
|
(2 |
) |
Gains on financial instruments |
50 |
|
— |
|
— |
|
— |
|
50 |
|
Interest (expense) income |
(230 |
) |
— |
|
1 |
|
— |
|
(229 |
) |
Foreign currency (loss) gain |
(3 |
) |
(2 |
) |
3 |
|
— |
|
(2 |
) |
Intercompany interest (expense) income |
(9 |
) |
53 |
|
(44 |
) |
— |
|
— |
|
|
(192 |
) |
51 |
|
(42 |
) |
— |
|
(183 |
) |
Income before income taxes |
306 |
|
410 |
|
238 |
|
— |
|
954 |
|
Income tax expense |
(110 |
) |
(124 |
) |
(108 |
) |
— |
|
(342 |
) |
Equity in earnings of subsidiaries, net of tax |
416 |
|
70 |
|
— |
|
(486 |
) |
— |
|
Net income |
612 |
|
356 |
|
130 |
|
(486 |
) |
612 |
|
Less net income attributable to the noncontrolling interest |
(52 |
) |
— |
|
(52 |
) |
52 |
|
(52 |
) |
Net income attributable to QVC, Inc. shareholder |
$ |
560 |
|
356 |
|
78 |
|
(434 |
) |
560 |
|
Consolidating statements of comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2013 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income |
$ |
633 |
|
353 |
|
132 |
|
(485 |
) |
633 |
|
Foreign currency translation adjustments |
(72 |
) |
— |
|
(72 |
) |
72 |
|
(72 |
) |
Total comprehensive income |
561 |
|
353 |
|
60 |
|
(413 |
) |
561 |
|
Comprehensive income attributable to noncontrolling interest |
(20 |
) |
— |
|
(20 |
) |
20 |
|
(20 |
) |
Comprehensive income attributable to QVC, Inc. shareholder |
$ |
541 |
|
353 |
|
40 |
|
(393 |
) |
541 |
|
Consolidating statements of comprehensive income - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2012 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income |
$ |
687 |
|
383 |
|
153 |
|
(536 |
) |
687 |
|
Foreign currency translation adjustments |
(27 |
) |
— |
|
(27 |
) |
27 |
|
(27 |
) |
Total comprehensive income |
660 |
|
383 |
|
126 |
|
(509 |
) |
660 |
|
Comprehensive income attributable to noncontrolling interest |
(44 |
) |
— |
|
(44 |
) |
44 |
|
(44 |
) |
Comprehensive income attributable to QVC, Inc. shareholder |
$ |
616 |
|
383 |
|
82 |
|
(465 |
) |
616 |
|
Consolidating statements of comprehensive income - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2011 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income |
612 |
|
356 |
|
130 |
|
(486 |
) |
612 |
|
Foreign currency translation adjustments |
(10 |
) |
— |
|
(10 |
) |
10 |
|
(10 |
) |
Total comprehensive income |
602 |
|
356 |
|
120 |
|
(476 |
) |
602 |
|
Comprehensive income attributable to noncontrolling interest |
(57 |
) |
— |
|
(57 |
) |
57 |
|
(57 |
) |
Comprehensive income attributable to QVC, Inc. shareholder |
$ |
545 |
|
356 |
|
63 |
|
(419 |
) |
545 |
|
Consolidating statements of cash flows
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2013 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Operating activities: |
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
$ |
379 |
|
389 |
|
205 |
|
— |
|
973 |
|
Investing activities: |
|
|
|
|
|
|
|
|
|
|
Capital expenditures, net |
(106 |
) |
(8 |
) |
(97 |
) |
— |
|
(211 |
) |
Expenditures for cable and satellite television distribution rights, net |
— |
|
(56 |
) |
(2 |
) |
— |
|
(58 |
) |
Decrease (increase) in restricted cash |
2 |
|
— |
|
(1 |
) |
— |
|
1 |
|
Changes in other noncurrent assets |
(1 |
) |
— |
|
(1 |
) |
— |
|
(2 |
) |
Intercompany investing activities |
368 |
|
277 |
|
— |
|
(645 |
) |
— |
|
Net cash provided by (used in) investing activities |
263 |
|
213 |
|
(101 |
) |
(645 |
) |
(270 |
) |
Financing activities: |
|
|
|
|
|
|
|
|
|
|
Principal payments of debt and capital lease obligations |
(2,375 |
) |
— |
|
(12 |
) |
— |
|
(2,387 |
) |
Principal borrowings of debt from senior secured credit facility |
1,674 |
|
— |
|
— |
|
— |
|
1,674 |
|
Proceeds from issuance of senior secured notes, net of original issue discount |
1,050 |
|
— |
|
— |
|
— |
|
1,050 |
|
Payment of debt origination fees |
(16 |
) |
— |
|
— |
|
— |
|
(16 |
) |
Payment of bond premium fees |
(46 |
) |
— |
|
— |
|
— |
|
(46 |
) |
Other financing activities |
12 |
|
— |
|
— |
|
— |
|
12 |
|
Dividends paid to Liberty |
(1,005 |
) |
— |
|
— |
|
— |
|
(1,005 |
) |
Dividends paid to noncontrolling interest |
— |
|
— |
|
(45 |
) |
— |
|
(45 |
) |
Net short-term intercompany debt borrowings (repayments) |
190 |
|
(63 |
) |
(127 |
) |
— |
|
— |
|
Intercompany financing activities |
(123 |
) |
(571 |
) |
49 |
|
645 |
|
— |
|
Net cash used in financing activities |
(639 |
) |
(634 |
) |
(135 |
) |
645 |
|
(763 |
) |
Effect of foreign exchange rate changes on cash and cash equivalents |
— |
|
— |
|
(23 |
) |
— |
|
(23 |
) |
Net increase (decrease) in cash and cash equivalents |
3 |
|
(32 |
) |
(54 |
) |
— |
|
(83 |
) |
Cash and cash equivalents, beginning of period |
75 |
|
165 |
|
300 |
|
— |
|
540 |
|
Cash and cash equivalents, end of period |
$ |
78 |
|
133 |
|
246 |
|
— |
|
457 |
|
Consolidating statements of cash flows - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2012 |
|
(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 |
$ |
462 |
|
412 |
|
332 |
|
— |
|
1,206 |
|
Investing activities: |
|
|
|
|
|
Capital expenditures, net |
(76 |
) |
(5 |
) |
(165 |
) |
— |
|
(246 |
) |
Expenditures for cable and satellite television distribution rights, net |
— |
|
(1 |
) |
(1 |
) |
— |
|
(2 |
) |
Cash paid for joint ventures and acquisitions of businesses, net of cash received |
— |
|
— |
|
(95 |
) |
— |
|
(95 |
) |
Decrease in restricted cash |
2 |
|
— |
|
— |
|
— |
|
2 |
|
Changes in other noncurrent assets |
(3 |
) |
— |
|
— |
|
— |
|
(3 |
) |
Intercompany investing activities |
443 |
|
265 |
|
— |
|
(708 |
) |
— |
|
Net cash provided by (used in) investing activities |
366 |
|
259 |
|
(261 |
) |
(708 |
) |
(344 |
) |
Financing activities: |
|
|
|
|
|
|
|
|
|
|
Principal payments of debt and capital lease obligations |
(1,237 |
) |
— |
|
(9 |
) |
— |
|
(1,246 |
) |
Principal borrowings of debt from senior secured credit facility |
1,717 |
|
— |
|
— |
|
— |
|
1,717 |
|
Proceeds from issuance of senior secured notes |
500 |
|
— |
|
— |
|
— |
|
500 |
|
Payment of debt origination fees |
(7 |
) |
— |
|
— |
|
— |
|
(7 |
) |
Other financing activities |
20 |
|
— |
|
— |
|
— |
|
20 |
|
Dividends paid to Liberty |
(1,817 |
) |
— |
|
— |
|
— |
|
(1,817 |
) |
Dividend paid to noncontrolling interest |
— |
|
— |
|
(29 |
) |
— |
|
(29 |
) |
Net short-term intercompany debt borrowings (repayments) |
214 |
|
(59 |
) |
(155 |
) |
— |
|
— |
|
Intercompany financing activities |
(146 |
) |
(670 |
) |
108 |
|
708 |
|
— |
|
Net cash used in financing activities |
(756 |
) |
(729 |
) |
(85 |
) |
708 |
|
(862 |
) |
Effect of foreign exchange rate changes on cash and cash equivalents |
— |
|
— |
|
(20 |
) |
— |
|
(20 |
) |
Net increase (decrease) in cash and cash equivalents |
72 |
|
(58 |
) |
(34 |
) |
— |
|
(20 |
) |
Cash and cash equivalents, beginning of period |
3 |
|
223 |
|
334 |
|
— |
|
560 |
|
Cash and cash equivalents, end of period |
$ |
75 |
|
165 |
|
300 |
|
— |
|
540 |
|
Consolidating statements of cash flows - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2011 |
|
(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 |
$ |
225 |
|
380 |
|
213 |
|
— |
|
818 |
|
Investing activities: |
|
|
|
|
|
Capital expenditures, net |
(83 |
) |
(8 |
) |
(168 |
) |
— |
|
(259 |
) |
Expenditures for cable and satellite television distribution rights, net |
— |
|
(2 |
) |
— |
|
— |
|
(2 |
) |
Decrease in restricted cash |
1 |
|
— |
|
— |
|
— |
|
1 |
|
Changes in other noncurrent assets and liabilities |
5 |
|
— |
|
(1 |
) |
— |
|
4 |
|
Intercompany investing activities |
348 |
|
190 |
|
— |
|
(538 |
) |
— |
|
Net cash provided by (used in) investing activities |
271 |
|
180 |
|
(169 |
) |
(538 |
) |
(256 |
) |
Financing activities: |
|
|
|
|
|
|
|
|
|
|
Principal payments of debt and capital lease obligations |
(825 |
) |
— |
|
(12 |
) |
— |
|
(837 |
) |
Principal borrowings of debt from senior secured credit facility |
465 |
|
— |
|
— |
|
— |
|
465 |
|
Dividends paid to Liberty |
(205 |
) |
— |
|
— |
|
— |
|
(205 |
) |
Dividends paid to noncontrolling interest |
— |
|
— |
|
(50 |
) |
— |
|
(50 |
) |
Net short-term intercompany debt borrowings (repayments) |
104 |
|
2 |
|
(106 |
) |
— |
|
— |
|
Intercompany financing activities |
(76 |
) |
(499 |
) |
37 |
|
538 |
|
— |
|
Net cash used in financing activities |
(537 |
) |
(497 |
) |
(131 |
) |
538 |
|
(627 |
) |
Effect of foreign exchange rate changes on cash and cash equivalents |
— |
|
— |
|
4 |
|
— |
|
4 |
|
Net (decrease) increase in cash and cash equivalents |
(41 |
) |
63 |
|
(83 |
) |
— |
|
(61 |
) |
Cash and cash equivalents, beginning of period |
44 |
|
160 |
|
417 |
|
— |
|
621 |
|
Cash and cash equivalents, end of period |
$ |
3 |
|
223 |
|
334 |
|
— |
|
560 |
|
|