|
Guarantor/Non-Guarantor Subsidiary Financial Information (Tables)
|
3 Months Ended |
|
Mar. 31, 2014
|
| Guarantor Non-guarantor Subsidiary Financial Information [Abstract] |
|
| Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Current Year |
Condensed consolidating balance sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2014 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Assets |
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
47 |
|
218 |
|
293 |
|
— |
|
558 |
|
Restricted cash |
11 |
|
— |
|
3 |
|
— |
|
14 |
|
Accounts receivable, net |
579 |
|
— |
|
278 |
|
— |
|
857 |
|
Inventories |
737 |
|
— |
|
280 |
|
— |
|
1,017 |
|
Deferred income taxes |
146 |
|
— |
|
17 |
|
— |
|
163 |
|
Prepaid expenses |
27 |
|
— |
|
27 |
|
— |
|
54 |
|
Total current assets |
1,547 |
|
218 |
|
898 |
|
— |
|
2,663 |
|
Property and equipment, net |
259 |
|
66 |
|
771 |
|
— |
|
1,096 |
|
Cable and satellite television distribution rights, net |
— |
|
479 |
|
107 |
|
— |
|
586 |
|
Goodwill |
4,169 |
|
— |
|
1,038 |
|
— |
|
5,207 |
|
Other intangible assets, net |
1,097 |
|
2,050 |
|
149 |
|
— |
|
3,296 |
|
Other noncurrent assets |
10 |
|
— |
|
62 |
|
— |
|
72 |
|
Investments in subsidiaries |
4,853 |
|
1,526 |
|
— |
|
(6,379 |
) |
— |
|
Total assets |
$ |
11,935 |
|
4,339 |
|
3,025 |
|
(6,379 |
) |
12,920 |
|
Liabilities and equity |
Current liabilities: |
|
|
|
|
|
Current portion of debt and capital lease obligations |
$ |
2 |
|
— |
|
10 |
|
— |
|
12 |
|
Accounts payable-trade |
287 |
|
— |
|
254 |
|
— |
|
541 |
|
Accrued liabilities |
249 |
|
106 |
|
426 |
|
— |
|
781 |
|
Intercompany accounts payable (receivable) |
935 |
|
(806 |
) |
(129 |
) |
— |
|
— |
|
Total current liabilities |
1,473 |
|
(700 |
) |
561 |
|
— |
|
1,334 |
|
Long-term portion of debt and capital lease obligations |
3,945 |
|
— |
|
53 |
|
— |
|
3,998 |
|
Deferred compensation |
13 |
|
— |
|
1 |
|
— |
|
14 |
|
Deferred income taxes |
358 |
|
912 |
|
3 |
|
— |
|
1,273 |
|
Other long-term liabilities |
91 |
|
— |
|
49 |
|
— |
|
140 |
|
Total liabilities |
5,880 |
|
212 |
|
667 |
|
— |
|
6,759 |
|
Equity: |
|
|
|
|
|
QVC, Inc. stockholder's equity |
6,055 |
|
4,127 |
|
2,252 |
|
(6,379 |
) |
6,055 |
|
Noncontrolling interest |
— |
|
— |
|
106 |
|
— |
|
106 |
|
Total equity |
6,055 |
|
4,127 |
|
2,358 |
|
(6,379 |
) |
6,161 |
|
Total liabilities and equity |
$ |
11,935 |
|
4,339 |
|
3,025 |
|
(6,379 |
) |
12,920 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Prior Year |
Condensed 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 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 |
336 |
|
— |
|
158 |
|
— |
|
494 |
|
Accrued liabilities |
393 |
|
96 |
|
471 |
|
— |
|
960 |
|
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. stockholder'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 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Current Year |
Condensed consolidating statements of operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2014 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
1,324 |
|
177 |
|
707 |
|
(222 |
) |
1,986 |
|
Cost of goods sold |
842 |
|
24 |
|
447 |
|
(57 |
) |
1,256 |
|
Gross profit |
482 |
|
153 |
|
260 |
|
(165 |
) |
730 |
|
Operating expenses: |
|
|
|
|
|
Operating |
40 |
|
45 |
|
93 |
|
— |
|
178 |
|
Selling, general and administrative, including stock-based compensation |
223 |
|
1 |
|
89 |
|
(165 |
) |
148 |
|
Depreciation |
9 |
|
1 |
|
23 |
|
— |
|
33 |
|
Amortization |
52 |
|
39 |
|
20 |
|
— |
|
111 |
|
Intercompany management expense (income) |
20 |
|
(3 |
) |
(17 |
) |
— |
|
— |
|
|
344 |
|
83 |
|
208 |
|
(165 |
) |
470 |
|
Operating income |
138 |
|
70 |
|
52 |
|
— |
|
260 |
|
Other (expense) income: |
|
|
|
|
|
Equity in losses of investee |
— |
|
— |
|
(1 |
) |
— |
|
(1 |
) |
Interest expense, net |
(53 |
) |
— |
|
(9 |
) |
— |
|
(62 |
) |
Foreign currency (loss) gain |
(2 |
) |
— |
|
1 |
|
— |
|
(1 |
) |
Intercompany interest (expense) income |
(5 |
) |
13 |
|
(8 |
) |
— |
|
— |
|
|
(60 |
) |
13 |
|
(17 |
) |
— |
|
(64 |
) |
Income before income taxes |
78 |
|
83 |
|
35 |
|
— |
|
196 |
|
Income tax benefit (expense) |
20 |
|
(24 |
) |
(70 |
) |
— |
|
(74 |
) |
Equity in earnings (losses) of subsidiaries, net of tax |
24 |
|
(48 |
) |
— |
|
24 |
|
— |
|
Net income (loss) |
122 |
|
11 |
|
(35 |
) |
24 |
|
122 |
|
Less net income attributable to the noncontrolling interest |
(9 |
) |
— |
|
(9 |
) |
9 |
|
(9 |
) |
Net income (loss) attributable to QVC, Inc. stockholder |
$ |
113 |
|
11 |
|
(44 |
) |
33 |
|
113 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Prior Year |
Condensed consolidating statements of operations - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2013 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
1,314 |
|
183 |
|
708 |
|
(231 |
) |
1,974 |
|
Cost of goods sold |
843 |
|
25 |
|
445 |
|
(61 |
) |
1,252 |
|
Gross profit |
471 |
|
158 |
|
263 |
|
(170 |
) |
722 |
|
Operating expenses: |
|
|
|
|
|
Operating |
37 |
|
46 |
|
90 |
|
— |
|
173 |
|
Selling, general and administrative, including stock-based compensation |
235 |
|
— |
|
90 |
|
(170 |
) |
155 |
|
Depreciation |
10 |
|
1 |
|
19 |
|
— |
|
30 |
|
Amortization |
51 |
|
34 |
|
19 |
|
— |
|
104 |
|
Intercompany management expense (income) |
17 |
|
(4 |
) |
(13 |
) |
— |
|
— |
|
|
350 |
|
77 |
|
205 |
|
(170 |
) |
462 |
|
Operating income |
121 |
|
81 |
|
58 |
|
— |
|
260 |
|
Other income (expense): |
|
|
|
|
|
Equity in earnings of investee |
— |
|
— |
|
1 |
|
— |
|
1 |
|
Gains on financial instruments |
12 |
|
— |
|
— |
|
— |
|
12 |
|
Interest expense, net |
(62 |
) |
— |
|
(1 |
) |
— |
|
(63 |
) |
Foreign currency (loss) gain |
(1 |
) |
(1 |
) |
1 |
|
— |
|
(1 |
) |
Loss on extinguishment of debt |
(41 |
) |
— |
|
— |
|
— |
|
(41 |
) |
Intercompany interest (expense) income |
(3 |
) |
12 |
|
(9 |
) |
— |
|
— |
|
|
(95 |
) |
11 |
|
(8 |
) |
— |
|
(92 |
) |
Income before income taxes |
26 |
|
92 |
|
50 |
|
— |
|
168 |
|
Income tax expense |
(10 |
) |
(28 |
) |
(24 |
) |
— |
|
(62 |
) |
Equity in earnings of subsidiaries, net of tax |
90 |
|
16 |
|
— |
|
(106 |
) |
— |
|
Net income |
106 |
|
80 |
|
26 |
|
(106 |
) |
106 |
|
Less net income attributable to the noncontrolling interest |
(12 |
) |
— |
|
(12 |
) |
12 |
|
(12 |
) |
Net income attributable to QVC, Inc. stockholder |
$ |
94 |
|
80 |
|
14 |
|
(94 |
) |
94 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Current Year |
onsolidating statements of comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2014 |
|
(in millions) |
Subsidiary
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income (loss) |
$ |
122 |
|
11 |
|
(35 |
) |
24 |
|
122 |
|
Foreign currency translation adjustments |
16 |
|
— |
|
16 |
|
(16 |
) |
16 |
|
Total comprehensive income (loss) |
138 |
|
11 |
|
(19 |
) |
8 |
|
138 |
|
Comprehensive income attributable to noncontrolling interest |
(12 |
) |
— |
|
(12 |
) |
12 |
|
(12 |
) |
Comprehensive income (loss) attributable to QVC, Inc. stockholder |
126 |
|
11 |
|
(31 |
) |
20 |
|
126 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Prior Year |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2013 |
|
(in millions) |
Subsidiary
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income |
$ |
106 |
|
80 |
|
26 |
|
(106 |
) |
106 |
|
Foreign currency translation adjustments |
(91 |
) |
— |
|
(91 |
) |
91 |
|
(91 |
) |
Total comprehensive income (loss) |
15 |
|
80 |
|
(65 |
) |
(15 |
) |
15 |
|
Comprehensive income attributable to noncontrolling interest |
1 |
|
— |
|
1 |
|
(1 |
) |
1 |
|
Comprehensive income (loss) attributable to QVC, Inc. stockholder |
16 |
|
80 |
|
(64 |
) |
(16 |
) |
16 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Current Year |
Condensed consolidating statements of cash flows
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 31, 2014 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Operating activities: |
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
107 |
|
98 |
|
56 |
|
— |
|
261 |
|
Investing activities: |
|
|
|
|
|
|
|
|
|
|
Capital expenditures, net |
(12 |
) |
— |
|
(17 |
) |
— |
|
(29 |
) |
Expenditures for cable and satellite television distribution rights, net |
— |
|
(8 |
) |
— |
|
— |
|
(8 |
) |
Changes in other noncurrent assets |
(2 |
) |
— |
|
— |
|
— |
|
(2 |
) |
Intercompany investing activities |
65 |
|
54 |
|
— |
|
(119 |
) |
— |
|
Net cash provided by (used in) investing activities |
51 |
|
46 |
|
(17 |
) |
(119 |
) |
(39 |
) |
Financing activities: |
|
|
|
|
|
|
|
|
|
|
Principal payments of debt and capital lease obligations |
(1,186 |
) |
— |
|
(2 |
) |
— |
|
(1,188 |
) |
Principal borrowings of debt from senior secured credit facility |
384 |
|
— |
|
— |
|
— |
|
384 |
|
Proceeds from issuance of senior secured notes, net of original issue discount |
999 |
|
— |
|
— |
|
— |
|
999 |
|
Payment of debt origination fees |
(12 |
) |
— |
|
— |
|
— |
|
(12 |
) |
Other financing activities |
7 |
|
— |
|
— |
|
— |
|
7 |
|
Dividends paid to Liberty |
(286 |
) |
— |
|
— |
|
— |
|
(286 |
) |
Dividends paid to noncontrolling interest |
— |
|
— |
|
(25 |
) |
— |
|
(25 |
) |
Net short-term intercompany debt (repayments) borrowings |
(84 |
) |
73 |
|
11 |
|
— |
|
— |
|
Intercompany financing activities |
(11 |
) |
(132 |
) |
24 |
|
119 |
|
— |
|
Net cash (used in) provided by financing activities |
(189 |
) |
(59 |
) |
8 |
|
119 |
|
(121 |
) |
Effect of foreign exchange rate changes on cash and cash equivalents |
— |
|
— |
|
— |
|
— |
|
— |
|
Net (decrease) increase in cash and cash equivalents |
(31 |
) |
85 |
|
47 |
|
— |
|
101 |
|
Cash and cash equivalents, beginning of period |
78 |
|
133 |
|
246 |
|
— |
|
457 |
|
Cash and cash equivalents, end of period |
47 |
|
218 |
|
293 |
|
— |
|
558 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Prior Year |
Condensed consolidating statements of cash flows - Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended March 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 |
62 |
|
79 |
|
34 |
|
— |
|
175 |
|
Investing activities: |
|
|
|
|
|
Capital expenditures, net |
(12 |
) |
— |
|
(21 |
) |
— |
|
(33 |
) |
Expenditures for cable and satellite television distribution rights, net |
— |
|
(24 |
) |
(1 |
) |
— |
|
(25 |
) |
Changes in other noncurrent assets |
(1 |
) |
— |
|
(3 |
) |
— |
|
(4 |
) |
Intercompany investing activities |
212 |
|
104 |
|
— |
|
(316 |
) |
— |
|
Net cash provided by (used in) investing activities |
199 |
|
80 |
|
(25 |
) |
(316 |
) |
(62 |
) |
Financing activities: |
|
|
|
|
|
|
|
|
|
|
Principal payments of debt and capital lease obligations |
(1,166 |
) |
— |
|
(2 |
) |
— |
|
(1,168 |
) |
Principal borrowings of debt from senior secured credit facility |
240 |
|
— |
|
— |
|
— |
|
240 |
|
Proceeds from issuance of senior secured notes, net of original issue discount |
1,050 |
|
— |
|
— |
|
— |
|
1,050 |
|
Payment of debt origination fees |
(14 |
) |
— |
|
— |
|
— |
|
(14 |
) |
Payment of bond premium fees |
(33 |
) |
— |
|
— |
|
— |
|
(33 |
) |
Other financing activities |
4 |
|
— |
|
— |
|
— |
|
4 |
|
Dividends paid to Liberty |
(244 |
) |
— |
|
— |
|
— |
|
(244 |
) |
Dividends paid to noncontrolling interest |
— |
|
— |
|
(25 |
) |
— |
|
(25 |
) |
Net short-term intercompany debt (repayments) borrowings |
(76 |
) |
84 |
|
(8 |
) |
— |
|
— |
|
Intercompany financing activities |
(94 |
) |
(240 |
) |
18 |
|
316 |
|
— |
|
Net cash used in financing activities |
(333 |
) |
(156 |
) |
(17 |
) |
316 |
|
(190 |
) |
Effect of foreign exchange rate changes on cash and cash equivalents |
— |
|
— |
|
(24 |
) |
— |
|
(24 |
) |
Net (decrease) increase in cash and cash equivalents |
(72 |
) |
3 |
|
(32 |
) |
— |
|
(101 |
) |
Cash and cash equivalents, beginning of period |
75 |
|
165 |
|
300 |
|
— |
|
540 |
|
Cash and cash equivalents, end of period |
3 |
|
168 |
|
268 |
|
— |
|
439 |
|
|