SEC Filings

S-4/A
TIME WARNER INC. filed this Form S-4/A on 03/24/2000
Entire Document
 
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                                AOL TIME WARNER
 
            Selected Unaudited Pro Forma Consolidated Financial Data
   
   The selected unaudited pro forma consolidated financial data of AOL Time
Warner have been derived from the unaudited pro forma consolidated condensed
financial statements included elsewhere in this joint proxy statement-
prospectus. Because America Online and Time Warner have different fiscal years,
and the combined company will adopt the calendar year-end of Time Warner, pro
forma operating results are presented on two different bases:     
     
  .  a June 30 fiscal-year basis, which is consistent with America Online's
     historical fiscal year-end; and     
     
  .  a December 31 calendar-year basis, which is consistent with both Time
     Warner's historical fiscal year-end and that of AOL Time Warner going
     forward.     
 
   Management believes that it is meaningful to present pro forma financial
information based on the calendar year-end of the combined company to
facilitate an analysis of the pro forma effects of the merger.
 

<TABLE>   
<CAPTION>
                                              Six Months    Year        Year
                                                Ended      Ended       Ended
                                             December 31, June 30,  December 31,
                                                 1999       1999        1999
                                             ------------ --------  ------------
                                               (in millions, except per share
                                                          amounts)
<S>                                          <C>          <C>       <C>
Statement of Operations Data:
  Revenues..................................   $17,799    $31,259     $33,051
  Amortization of goodwill and other
   intangible assets........................    (4,225)    (8,412)     (8,413)
  Business segment operating income (loss)..       469     (2,097)       (117)
  Interest and other, net...................      (834)    (1,412)     (1,083)
  Loss before extraordinary item............    (1,075)    (3,914)     (2,541)
  Loss before extraordinary item per basic
   and diluted share........................   $ (0.26)   $ (1.10)    $ (0.63)
  Average common shares.....................     4,172      3,928       4,090
  EBITDA(/1/)(/2/) .........................   $ 5,462    $ 7,778     $ 9,775
 
--------
(/1/) EBITDA consists of business segment operating income (loss) before
      depreciation and amortization. AOL Time Warner considers EBITDA to be an
      important indicator of the operational strength and performance of its
      businesses, including the ability to provide cash flows to service debt
      and fund capital expenditures. EBITDA, however, should not be considered
      an alternative to operating or net income as an indicator of the
      performance of AOL Time Warner, or as an alternative to cash flows from
      operating activities as a measure of liquidity, in each case determined
      in accordance with generally accepted accounting principles. In addition,
      this definition of EBITDA may not be comparable to similarly titled
      measures reported by other companies.
 
(/2/) EBITDA includes a number of significant and nonrecurring items. The
      aggregate effect of those items for each period, as well as the adjusted
      EBITDA excluding such amounts, is as follows:
 
 
 Increase in EBITDA.........................   $ 1,432    $   890     $ 2,300
                                               =======    =======     =======
 Adjusted EBITDA............................   $ 4,030    $ 6,888     $ 7,475
                                               =======    =======     =======
 
</TABLE>
    
 
   See "Selected Historical Financial Data" elsewhere herein for further
reference.
 
 
 

<TABLE>   
<CAPTION>
                                                                    December 31,
                                                                        1999
                                                                    ------------
                                                                        (in
                                                                     millions)
<S>                                                                 <C>
Balance Sheet Data:
  Cash and equivalents.............................................   $  3,819
  Total assets.....................................................    235,818
  Long-term debt and other obligations(/3/)........................     21,487
  Shareholders' equity.............................................    155,177
</TABLE>
    
--------
   
(/3/) Includes $1.243 billion of borrowings against future stock option
      proceeds and $575 million of mandatorily redeemable preferred securities
      of subsidiaries.     
 
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