Guarantor/Non-Guarantor Subsidiary Financial Information (Tables)
|
6 Months Ended |
Jun. 30, 2019 |
Jun. 30, 2018 |
| Guarantor Non-guarantor Subsidiary Financial Information [Abstract] |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Current Period |
Condensed Consolidating Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2019 |
|
(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 |
$ |
11 |
|
186 |
|
253 |
|
— |
|
450 |
|
Restricted cash |
5 |
|
— |
|
3 |
|
— |
|
8 |
|
Accounts receivable, net |
783 |
|
181 |
|
290 |
|
— |
|
1,254 |
|
Inventories |
752 |
|
274 |
|
280 |
|
— |
|
1,306 |
|
Prepaid expenses and other current assets |
65 |
|
17 |
|
53 |
|
— |
|
135 |
|
Total current assets |
1,616 |
|
658 |
|
879 |
|
— |
|
3,153 |
|
Property and equipment, net |
268 |
|
236 |
|
689 |
|
— |
|
1,193 |
|
Operating lease right-of-use assets |
3 |
|
14 |
|
131 |
|
— |
|
148 |
|
Television distribution rights, net |
— |
|
198 |
|
1 |
|
— |
|
199 |
|
Goodwill |
4,190 |
|
922 |
|
864 |
|
— |
|
5,976 |
|
Other intangible assets, net |
547 |
|
3,087 |
|
27 |
|
— |
|
3,661 |
|
Other noncurrent assets |
11 |
|
12 |
|
46 |
|
— |
|
69 |
|
Investments in subsidiaries |
5,717 |
|
943 |
|
— |
|
(6,660 |
) |
— |
|
Total assets |
$ |
12,352 |
|
6,070 |
|
2,637 |
|
(6,660 |
) |
14,399 |
|
Liabilities and equity |
Current liabilities: |
|
|
|
|
|
Current portion of debt and finance lease obligations |
$ |
3 |
|
1 |
|
16 |
|
— |
|
20 |
|
Accounts payable-trade |
372 |
|
106 |
|
224 |
|
— |
|
702 |
|
Accrued liabilities |
150 |
|
372 |
|
335 |
|
— |
|
857 |
|
Intercompany accounts payable (receivable) |
62 |
|
(1,216 |
) |
1,154 |
|
— |
|
— |
|
Total current liabilities |
587 |
|
(737 |
) |
1,729 |
|
— |
|
1,579 |
|
Long-term portion of debt and finance lease obligations |
4,921 |
|
6 |
|
145 |
|
— |
|
5,072 |
|
Deferred income taxes |
65 |
|
684 |
|
(59 |
) |
— |
|
690 |
|
Other long-term liabilities |
152 |
|
22 |
|
141 |
|
— |
|
315 |
|
Total liabilities |
5,725 |
|
(25 |
) |
1,956 |
|
— |
|
7,656 |
|
Equity: |
|
|
|
|
|
QVC, Inc. stockholder's equity |
6,627 |
|
6,095 |
|
565 |
|
(6,660 |
) |
6,627 |
|
Noncontrolling interest |
— |
|
— |
|
116 |
|
— |
|
116 |
|
Total equity |
6,627 |
|
6,095 |
|
681 |
|
(6,660 |
) |
6,743 |
|
Total liabilities and equity |
$ |
12,352 |
|
6,070 |
|
2,637 |
|
(6,660 |
) |
14,399 |
|
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Balance Sheets, Prior Period |
Condensed Consolidating Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018 |
|
(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 |
$ |
73 |
|
192 |
|
278 |
|
— |
|
543 |
|
Restricted cash |
5 |
|
— |
|
2 |
|
— |
|
7 |
|
Accounts receivable, net |
1,166 |
|
307 |
|
314 |
|
— |
|
1,787 |
|
Inventories |
725 |
|
310 |
|
245 |
|
— |
|
1,280 |
|
Prepaid expenses and other current assets |
95 |
|
73 |
|
48 |
|
— |
|
216 |
|
Total current assets |
2,064 |
|
882 |
|
887 |
|
— |
|
3,833 |
|
Property and equipment, net |
281 |
|
213 |
|
671 |
|
— |
|
1,165 |
|
Television distribution rights, net |
— |
|
139 |
|
1 |
|
— |
|
140 |
|
Goodwill |
4,190 |
|
922 |
|
860 |
|
— |
|
5,972 |
|
Other intangible assets, net |
529 |
|
3,116 |
|
21 |
|
— |
|
3,666 |
|
Other noncurrent assets |
8 |
|
20 |
|
52 |
|
— |
|
80 |
|
Investments in subsidiaries |
5,523 |
|
885 |
|
— |
|
(6,408 |
) |
— |
|
Total assets |
$ |
12,595 |
|
6,177 |
|
2,492 |
|
(6,408 |
) |
14,856 |
|
Liabilities and equity |
Current liabilities: |
|
|
|
|
|
Current portion of debt and capital lease obligations |
$ |
403 |
|
1 |
|
17 |
|
— |
|
421 |
|
Accounts payable-trade |
494 |
|
201 |
|
313 |
|
— |
|
1,008 |
|
Accrued liabilities |
358 |
|
394 |
|
274 |
|
— |
|
1,026 |
|
Intercompany accounts (receivable) payable |
(95 |
) |
(1,015 |
) |
1,110 |
|
— |
|
— |
|
Total current liabilities |
1,160 |
|
(419 |
) |
1,714 |
|
— |
|
2,455 |
|
Long-term portion of debt and capital lease obligations |
4,540 |
|
6 |
|
153 |
|
— |
|
4,699 |
|
Deferred income taxes |
63 |
|
695 |
|
(58 |
) |
— |
|
700 |
|
Other long-term liabilities |
122 |
|
34 |
|
17 |
|
— |
|
173 |
|
Total liabilities |
5,885 |
|
316 |
|
1,826 |
|
— |
|
8,027 |
|
Equity: |
|
|
|
|
|
QVC, Inc. stockholder's equity |
6,710 |
|
5,861 |
|
547 |
|
(6,408 |
) |
6,710 |
|
Noncontrolling interest |
— |
|
— |
|
119 |
|
— |
|
119 |
|
Total equity |
6,710 |
|
5,861 |
|
666 |
|
(6,408 |
) |
6,829 |
|
Total liabilities and equity |
$ |
12,595 |
|
6,177 |
|
2,492 |
|
(6,408 |
) |
14,856 |
|
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Current Period |
Condensed Consolidating Statements of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2019 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
1,423 |
|
695 |
|
693 |
|
(297 |
) |
2,514 |
|
Operating costs and expenses |
|
|
|
|
|
Cost of goods sold (exclusive of depreciation and amortization shown separately below) |
847 |
|
342 |
|
422 |
|
(33 |
) |
1,578 |
|
Operating |
101 |
|
98 |
|
67 |
|
(87 |
) |
179 |
|
Selling, general and administrative, including transaction related costs and stock-based compensation |
286 |
|
45 |
|
114 |
|
(177 |
) |
268 |
|
Depreciation |
15 |
|
9 |
|
30 |
|
— |
|
54 |
|
Amortization |
18 |
|
48 |
|
4 |
|
— |
|
70 |
|
|
1,267 |
|
542 |
|
637 |
|
(297 |
) |
2,149 |
|
Operating income |
156 |
|
153 |
|
56 |
|
— |
|
365 |
|
Other (expense) income: |
|
|
|
|
|
Equity in losses of investee |
— |
|
— |
|
(1 |
) |
— |
|
(1 |
) |
Losses on financial instruments |
(1 |
) |
— |
|
— |
|
— |
|
(1 |
) |
Interest (expense) income, net |
(59 |
) |
— |
|
(1 |
) |
— |
|
(60 |
) |
Foreign currency gain (loss) |
1 |
|
— |
|
(1 |
) |
— |
|
— |
|
Intercompany interest income (expense) |
8 |
|
10 |
|
(18 |
) |
— |
|
— |
|
|
(51 |
) |
10 |
|
(21 |
) |
— |
|
(62 |
) |
Income before income taxes |
105 |
|
163 |
|
35 |
|
— |
|
303 |
|
Income tax expense |
(32 |
) |
(32 |
) |
(21 |
) |
— |
|
(85 |
) |
Equity in earnings of subsidiaries, net of tax |
145 |
|
— |
|
— |
|
(145 |
) |
— |
|
Net income |
218 |
|
131 |
|
14 |
|
(145 |
) |
218 |
|
Less net income attributable to the noncontrolling interest |
(12 |
) |
— |
|
(12 |
) |
12 |
|
(12 |
) |
Net income attributable to QVC, Inc. stockholder |
$ |
206 |
|
131 |
|
2 |
|
(133 |
) |
206 |
|
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Statements of Operations, Prior Period |
|
Condensed Consolidating Statements of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2018 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net revenue |
$ |
1,460 |
|
691 |
|
704 |
|
(299 |
) |
2,556 |
|
Operating costs and expenses |
|
|
|
|
|
Cost of goods sold (exclusive of depreciation and amortization shown separately below) |
858 |
|
335 |
|
433 |
|
(37 |
) |
1,589 |
|
Operating |
97 |
|
123 |
|
70 |
|
(81 |
) |
209 |
|
Selling, general and administrative, including transaction related costs and stock-based compensation |
273 |
|
62 |
|
116 |
|
(181 |
) |
270 |
|
Depreciation |
17 |
|
9 |
|
17 |
|
— |
|
43 |
|
Amortization |
19 |
|
34 |
|
2 |
|
— |
|
55 |
|
|
1,264 |
|
563 |
|
638 |
|
(299 |
) |
2,166 |
|
Operating income |
196 |
|
128 |
|
66 |
|
— |
|
390 |
|
Other (expense) income: |
|
|
|
|
|
Equity in losses of investee |
— |
|
— |
|
(2 |
) |
— |
|
(2 |
) |
Interest expense, net |
(57 |
) |
(9 |
) |
(2 |
) |
— |
|
(68 |
) |
Foreign currency gain (loss) |
6 |
|
— |
|
(4 |
) |
— |
|
2 |
|
Intercompany interest (expense) income |
(8 |
) |
38 |
|
(30 |
) |
— |
|
— |
|
|
(59 |
) |
29 |
|
(38 |
) |
— |
|
(68 |
) |
Income before income taxes |
137 |
|
157 |
|
28 |
|
— |
|
322 |
|
Income tax expense |
(38 |
) |
(27 |
) |
(13 |
) |
— |
|
(78 |
) |
Equity in earnings of subsidiaries, net of tax |
145 |
|
9 |
|
— |
|
(154 |
) |
— |
|
Net income |
244 |
|
139 |
|
15 |
|
(154 |
) |
244 |
|
Less net income attributable to the noncontrolling interest |
(11 |
) |
— |
|
(11 |
) |
11 |
|
(11 |
) |
Net income attributable to QVC, Inc. stockholder |
$ |
233 |
|
139 |
|
4 |
|
(143 |
) |
233 |
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Current Period |
Condensed Consolidating Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2019 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income |
$ |
218 |
|
131 |
|
14 |
|
(145 |
) |
218 |
|
Foreign currency translation adjustments, net of tax |
14 |
|
— |
|
14 |
|
(14 |
) |
14 |
|
Total comprehensive income |
232 |
|
131 |
|
28 |
|
(159 |
) |
232 |
|
Comprehensive income attributable to noncontrolling interest |
(15 |
) |
— |
|
(15 |
) |
15 |
|
(15 |
) |
Comprehensive income attributable to QVC, Inc. stockholder |
$ |
217 |
|
131 |
|
13 |
|
(144 |
) |
217 |
|
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Comprehensive Income (Loss), Prior Period |
Condensed Consolidating Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2018 |
|
(in millions) |
Parent
issuer-
QVC, Inc. |
|
Combined
subsidiary
guarantors |
|
Combined
non-guarantor
subsidiaries |
|
Eliminations |
|
Consolidated-
QVC, Inc. and
subsidiaries |
|
Net income |
$ |
244 |
|
139 |
|
15 |
|
(154 |
) |
244 |
|
Foreign currency translation adjustments, net of tax |
(96 |
) |
— |
|
(96 |
) |
96 |
|
(96 |
) |
Total comprehensive income |
148 |
|
139 |
|
(81 |
) |
(58 |
) |
148 |
|
Comprehensive income attributable to noncontrolling interest |
(6 |
) |
— |
|
(6 |
) |
6 |
|
(6 |
) |
Comprehensive income attributable to QVC, Inc. stockholder |
$ |
142 |
|
139 |
|
(87 |
) |
(52 |
) |
142 |
|
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Current Period |
Condensed Consolidating Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2019 |
|
(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 |
$ |
293 |
|
383 |
|
23 |
|
— |
|
699 |
|
Investing activities: |
|
|
|
|
|
Capital expenditures |
(61 |
) |
(28 |
) |
(64 |
) |
— |
|
(153 |
) |
Expenditures for television distribution rights |
— |
|
(124 |
) |
— |
|
— |
|
(124 |
) |
Changes in other noncurrent assets |
(10 |
) |
8 |
|
(11 |
) |
— |
|
(13 |
) |
Other investing activities |
— |
|
29 |
|
— |
|
— |
|
29 |
|
Intercompany investing activities |
77 |
|
(319 |
) |
— |
|
242 |
|
— |
|
Net cash provided by (used in) investing activities |
6 |
|
(434 |
) |
(75 |
) |
242 |
|
(261 |
) |
Financing activities: |
|
|
|
|
|
Principal payments of debt and finance lease obligations |
(1,420 |
) |
— |
|
(5 |
) |
— |
|
(1,425 |
) |
Principal borrowings of debt from senior secured credit facility |
1,795 |
|
— |
|
— |
|
— |
|
1,795 |
|
Principal repayment of senior secured notes |
(400 |
) |
— |
|
— |
|
— |
|
(400 |
) |
Dividends paid to Qurate Retail, Inc. |
(469 |
) |
— |
|
— |
|
— |
|
(469 |
) |
Dividends paid to noncontrolling interest |
— |
|
— |
|
(28 |
) |
— |
|
(28 |
) |
Other financing activities |
(4 |
) |
— |
|
— |
|
— |
|
(4 |
) |
Net short-term intercompany debt borrowings (repayments) |
157 |
|
(201 |
) |
44 |
|
— |
|
— |
|
Other intercompany financing activities |
(20 |
) |
246 |
|
16 |
|
(242 |
) |
— |
|
Net cash (used in) provided by financing activities |
(361 |
) |
45 |
|
27 |
|
(242 |
) |
(531 |
) |
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash |
— |
|
— |
|
1 |
|
— |
|
1 |
|
Net decrease in cash, cash equivalents and restricted cash |
(62 |
) |
(6 |
) |
(24 |
) |
— |
|
(92 |
) |
Cash, cash equivalents and restricted cash, beginning of period |
78 |
|
192 |
|
280 |
|
— |
|
550 |
|
Cash, cash equivalents and restricted cash, end of period |
$ |
16 |
|
186 |
|
256 |
|
— |
|
458 |
|
|
|
| Guarantor Non-guarantor Subsidiary Financial Information, Schedule of Cash Flows, Prior Period |
Condensed Consolidating Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2018 |
|
(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 |
$ |
345 |
|
252 |
|
54 |
|
— |
|
651 |
|
Investing activities: |
|
|
|
|
|
Capital expenditures |
(39 |
) |
(7 |
) |
(28 |
) |
— |
|
(74 |
) |
Expenditures for television distribution rights |
— |
|
(60 |
) |
(1 |
) |
— |
|
(61 |
) |
Other investing activities |
— |
|
(8 |
) |
— |
|
— |
|
(8 |
) |
Changes in other noncurrent assets |
1 |
|
— |
|
(1 |
) |
— |
|
— |
|
Intercompany investing activities |
89 |
|
(105 |
) |
— |
|
16 |
|
— |
|
Net cash provided by (used in) investing activities |
51 |
|
(180 |
) |
(30 |
) |
16 |
|
(143 |
) |
Financing activities: |
|
|
|
|
|
Principal payments of debt and capital lease obligations |
(1,442 |
) |
(160 |
) |
(6 |
) |
— |
|
(1,608 |
) |
Principal borrowings of debt from senior secured credit facility |
1,278 |
|
180 |
|
— |
|
— |
|
1,458 |
|
Capital contributions received from Qurate Retail, Inc. |
140 |
|
— |
|
— |
|
— |
|
140 |
|
Dividends paid to Qurate Retail, Inc. |
(243 |
) |
— |
|
— |
|
— |
|
(243 |
) |
Dividends paid to noncontrolling interest |
— |
|
— |
|
(23 |
) |
— |
|
(23 |
) |
Other financing activities |
(7 |
) |
(7 |
) |
— |
|
— |
|
(14 |
) |
Net short-term intercompany debt (repayments) borrowings |
(86 |
) |
36 |
|
50 |
|
— |
|
— |
|
Other intercompany financing activities |
(14 |
) |
5 |
|
25 |
|
(16 |
) |
— |
|
Net cash (used in) provided by financing activities |
(374 |
) |
54 |
|
46 |
|
(16 |
) |
(290 |
) |
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash |
— |
|
— |
|
4 |
|
— |
|
4 |
|
Net increase in cash, cash equivalents and restricted cash |
22 |
|
126 |
|
74 |
|
— |
|
222 |
|
Cash, cash equivalents and restricted cash, beginning of period |
7 |
|
55 |
|
228 |
|
— |
|
290 |
|
Cash, cash equivalents and restricted cash, end of period |
$ |
29 |
|
181 |
|
302 |
|
— |
|
512 |
|
|
|