SEC Filings

10-Q
TIME WARNER INC. filed this Form 10-Q on 08/02/2017
Entire Document
 


Table of Contents

TIME WARNER INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)

 

Amortization Expense.  Amortization expense was $46 million and $91 million for the three and six months ended June 30, 2017, respectively, and $47 million and $95 million for the three and six months ended June 30, 2016, respectively.

Restructuring and Severance Costs.  For the three and six months ended June 30, 2017 and 2016, the Company incurred Restructuring and severance costs primarily related to employee terminations and other exit activities. Restructuring and severance costs are as follows (millions):

 

                                                                                   
     Three Months Ended June 30,    Six Months Ended June 30,
     2017    2016    2017   2016

Turner

   $       5      $       6      $       7     $       7  

Home Box Office

     3        37        5       41  

Warner Bros.

            4        9       5  

Corporate

            1        (1      
  

 

 

 

  

 

 

 

  

 

 

 

 

 

 

 

Total restructuring and severance costs

   $ 8      $ 48      $ 20     $ 53  
  

 

 

 

  

 

 

 

  

 

 

 

 

 

 

 

Operating Income.  Operating Income decreased to $1.692 billion for the three months ended June 30, 2017 from $1.846 billion for the three months ended June 30, 2016. Excluding the items noted under “Transactions and Other Items Affecting Comparability” totaling $63 million of expense and $86 million of income for the three months ended June 30, 2017 and 2016, respectively, Operating Income decreased $5 million, primarily reflecting a decrease at the Turner segment, partially offset by increases at the Home Box Office and Warner Bros. segments. Operating Income decreased to $3.768 billion for the six months ended June 30, 2017 from $3.842 billion for the six months ended June 30, 2016. Excluding the items noted under “Transactions and Other Items Affecting Comparability” totaling $140 million of expense and $70 million of income for the six months ended June 30, 2017 and 2016, respectively, Operating Income increased $136 million, primarily reflecting increases at the Home Box Office and Warner Bros. segments, partially offset by a decrease at the Turner segment.

Interest Expense, Net.  Interest expense, net detail is shown in the table below (millions):

 

                                                                                   
     Three Months Ended June 30,   Six Months Ended June 30,
     2017   2016   2017   2016

Interest expense

   $ (306   $ (348   $ (614   $ (695

Interest income

     57       56       106       119  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

   $ (249   $ (292   $ (508   $ (576
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The decrease in interest expense for the three and six months ended June 30, 2017 was primarily due to lower average interest rates and lower average debt balances. The decrease in interest income for the six months ended June 30, 2017 was primarily driven by the financing transactions with CME that were completed in the second quarter of 2016.

Other Income (Loss), Net.  Other income (loss), net detail is shown in the table below (millions):

 

                                                                                   
     Three Months Ended June 30,   Six Months Ended June 30,
     2017   2016   2017   2016

Investment gains, net

   $ 96     $ 47     $ 255     $ 36  

Amounts related to the separation or disposition of former
Time Warner segments

     (2     (5     (6     (9

Loss from equity method investees

     (19     (168     (95     (202

Other

     (4     (5     (7     4  
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (loss), net

   $ 71     $ (131   $ 147     $ (171
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment gains, net and amounts related to the separation or disposition of former Time Warner segments are discussed under “Transactions and Other Items Affecting Comparability.” The decrease in loss from equity method investees for the three and six months ended June 30, 2017 was primarily due to the recognition during the three months ended June 30, 2016 of the Company’s share of losses from CME related to the 2016 CME financing transactions.

 

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