Slide 1: Second Quarter 2015 Financial Results
SECOND QUARTER 2015 Financial Results August 4, 2015
Slide 2: Disclaimer
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995; particularly statements regarding future financial and operating results of Time Inc. (the “Company”) and its business. These statements are based on management’s current
Slide 3: 2Q15 Financial Highlights
Adjusted OIBDA of $117 million versus $113 million last year Excluding: (1) the impact of the dispositions of CNNMoney and Grupo Editorial Expansión or “GEX”, (2) the impact of the stronger US dollar relative to the British pound or “FX”, and (3) the impact of the wholesaler transition - Digital
Slide 4: 2Q15 Total Revenues
2Q15 TOTAL REVENUES Total revenues down 6% - Dispositions of CNNMoney and GEX drove 3% pts decline - FX drove 1% pt decline - Wholesaler transition drove 2% pts increase $820 $773 2Q14 2Q15 HIGHLIGHTS 4 $MM
Slide 5: 2Q15 Advertising Revenues
$387 $343 $74 $77 Digital Advertising Print and Other Advertising 2Q15 ADVERTISING REVENUES Total advertising revenues down 9% - Dispositions of CNNMoney and GEX drove 4% pts decline - FX drove 1% pt decline Print and other advertising down 11% - Disposition of GEX drove 2% pts decline Digital
Slide 6: 2Q15 Circulation Revenues
$171 $166 $83 $82 $4 $6 $1 $2 Other Circulation Revenues Newsstand Revenues Subscription Revenues 2Q15 CIRCULATION REVENUES Subscription revenues down 3% - Disposition of GEX and FX drove 1% pt decline Newsstand revenues down 1% - FX drove 6% pts decline - Wholesaler transition drove 13% pts inc
Slide 7: 2Q15 Other Revenues
2Q15 OTHER REVENUES Other revenues down 2% - FX drove 1% pt decline - Wholesaler transition drove 6% pts increase - Book business experienced continued weakness $MM $101 $99 2Q14 2Q15 HIGHLIGHTS 7
Slide 8: 2Q15 Operating Expenses
$384 $362 $328 $295 Costs of Revenues (COR) SG&A 2Q15 OPERATING EXPENSES Costs of revenues down 10% - Dispositions of CNNMoney and GEX drove 2% pts decline - FX drove 2% pts decline SG&A down 6% - Dispositions of CNNMoney and GEX drove 3% pts decline - FX drove 1% pt decline Costs of revenues
Slide 9: 2Q15 Adjusted OIBDA
1 2 2Q15 ADJUSTED OIBDA Adjusted OIBDA of $117 million - Dispositions of CNNMoney and GEX drove 2% pts decline - FX drove 3% pts decline - Incremental real estate drove 10% pts decline - Wholesaler transition drove 23% pts increase $113 $117 2Q 4 2Q15 HIGHLIGHTS 9 $MM
Slide 10: 2Q15 Cash Update: Free Cash Flow
2Q15 CASH UPDATE FREE CASH FLOW 2Q15 Free Cash Flow of $4 million - Includes $59 million of capital expenditures compared to $16 million in 2Q14 $32 million net cash used in acquisitions and dispositions Dividend of $0.19 per share ($21) million paid on 6/15/15 As of 6/30/15, net leverage ra
Slide 11: Time Inc. Outlook for 2015
TIME INC. OUTLOOK FOR 2015 $MM 2014 ACTUAL FULL YEAR 2015 OUTLOOK RANGE Revenues – as reported (2.2%) (3%) to (6%) Revenues1 (5.3%) (1.5%) to (4.5%) Impact of 2014 wholesaler transition ($22) 70 bps Forecasted impact of stronger USD2 ------ (120 bps) Adjusted OIBDA3 $524 $440 to $490 Impact of 2014
Slide 12: Q&A
Q&A 12
Slide 13: Appendix
Appendix 13
Slide 14: Schedule I: Reconciliation of Operating Income (Loss) to Adjusted OIBDA
Schedule I TIME INC. RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OIBDA (Unaudited; in millions) ______________ (1) OIBDA is defined as Operating income (loss) excluding Depreciation and Amortization of intangible assets. (2) Other costs related to acquisitions and dispositions during the p
Slide 15: Schedule II: Reconciliation of Net Income (Loss) to Adjusted Net Income
Schedule II TIME INC. RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED NET INCOME (Unaudited; in millions) ______________ (1) Gain on non-operating assets during the three and six months ended June 30, 2015 related to assets acquired in connection with the purchase of the remaining 50% interest in a
Slide 16: Schedule III: Reconciliation of Diluted EPS to Adjusted Diluted EPS
Schedule III TIME INC. RECONCILIATION OF DILUTED EPS TO ADJUSTED DILUTED EPS (Unaudited; all per share amounts are net of tax) ______________ (1) Adjusted Diluted EPS is defined as Diluted EPS adjusted for impairments of Goodwill, intangibles, fixed assets and investments; Restructuring and severanc
Slide 17: Schedule IV: Reconciliation of Cash Provided by Operations to Free Cash Flow
Schedule IV TIME INC. RECONCILIATION OF CASH PROVIDED BY OPERATIONS TO FREE CASH FLOW (Unaudited; in millions) ______________ (1) Free Cash Flow is defined as Cash provided by (used in) operations, less Capital expenditures. Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 C
Slide 18: Schedule V: Reconciliation of Operating Income to Adjusted OIBDA - 2015 Outlook
Schedule V TIME INC. RECONCILIATION OF OPERATING INCOME TO ADJUSTED OIBDA - 2015 OUTLOOK (Unaudited; in millions) _____________ (1) OIBDA is defined as Operating income (loss) excluding Depreciation and Amortization of intangible assets. (2) Our 2015 Outlook primarily relates to a noncash charge in