This management commentary contains forward-looking statements regarding the Company’s results and prospects. Actual results could differ materially from these statements. The forward-looking statements in these management commentary releases should be read in conjunction with the factors described in “Item 3. Key Information – Forward-Looking Statements” in the Company’s Annual Report on Form 20-F, which, among others, could cause actual results to differ materially from those contained in forward-looking statements made in this press release and in oral statements made by authorized officers of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise
.
The financial institutions that perform financial analysis on the securities of Grupo Televisa, S.A.B. are as follows:
[410000] Statement of comprehensive income, OCI components presented net of tax
Purchase of other long-term assets
|
0
|
0
|
Proceeds from government grants
|
0
|
0
|
Cash advances and loans made to other parties
|
0
|
0
|
Cash receipts from repayment of advances and loans made to other parties
|
0
|
0
|
Cash payments for future contracts, forward contracts, option contracts and swap contracts
|
0
|
0
|
Cash receipts from future contracts, forward contracts, option contracts and swap contracts
|
0
|
0
|
Dividends received
|
0
|
0
|
Interest paid
|
0
|
0
|
Interest received
|
0
|
0
|
Income taxes refund (paid)
|
0
|
0
|
Other inflows (outflows) of cash
|
-32,979,000
|
315,451,000
|
Net cash flows from (used in) investing activities
|
-8,285,312,000
|
-14,042,493,000
|
Cash flows from (used in) financing activities [abstract]
|
|
|
Proceeds from changes in ownership interests in subsidiaries that do not result in loss of control
|
0
|
0
|
Payments from changes in ownership interests in subsidiaries that do not result in loss of control
|
0
|
0
|
Proceeds from issuing shares
|
0
|
0
|
Proceeds from issuing other equity instruments
|
0
|
0
|
Payments to acquire or redeem entity's shares
|
208,017,000
|
20,152,000
|
Payments of other equity instruments
|
0
|
0
|
Proceeds from borrowings
|
5,728,500,000
|
998,500,000
|
Repayments of borrowings
|
3,550,650,000
|
590,365,000
|
Payments of finance lease liabilities
|
73,848,000
|
75,457,000
|
Proceeds from government grants
|
0
|
0
|
Dividends paid
|
0
|
0
|
Interest paid
|
1,332,951,000
|
1,129,802,000
|
Income taxes refund (paid)
|
0
|
0
|
Other inflows (outflows) of cash
|
106,421,000
|
-143,498,000
|
Net cash flows from (used in) financing activities
|
669,455,000
|
-960,774,000
|
Net increase (decrease) in cash and cash equivalents before effect of exchange rate changes
|
4,163,881,000
|
4,131,583,000
|
Effect of exchange rate changes on cash and cash equivalents [abstract]
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
4,164,000
|
25,970,000
|
Net increase (decrease) in cash and cash equivalents
|
4,168,045,000
|
4,157,553,000
|
Cash and cash equivalents at beginning of period
|
49,397,126,000
|
29,729,350,000
|
Cash and cash equivalents at end of period
|
53,565,171,000
|
33,886,903,000
|
[610000] Statement of changes in equity - Year Current
|
Components of equity [axis]
|
Page 1 of 3
|
Issued capital [member]
|
Share premium [member]
|
Treasury shares [member]
|
Retained earnings [member]
|
Revaluation surplus [member]
|
Reserve of exchange differences on translation [member]
|
Reserve of cash flow hedges [member]
|
Reserve of gains and losses on hedging instruments that hedge investments in equity instruments [member]
|
Reserve of change in value of time value of options [member]
|
Retrospective application and retrospective restatement [axis]
|
|
|
|
|
|
|
|
|
|
Statement of changes in equity [line items]
|
|
|
|
|
|
|
|
|
|
Equity at beginning of period
|
4,978,126,000
|
15,889,819,000
|
11,882,248,000
|
73,139,684,000
|
0
|
972,154,000
|
-153,264,000
|
0
|
0
|
Changes in equity [abstract]
|
|
|
|
|
|
|
|
|
|
Comprehensive income [abstract]
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
0
|
0
|
0
|
600,434,000
|
0
|
0
|
0
|
0
|
0
|
Other comprehensive income
|
0
|
0
|
0
|
0
|
0
|
132,855,000
|
-22,594,000
|
0
|
0
|
Total comprehensive income
|
0
|
0
|
0
|
600,434,000
|
0
|
132,855,000
|
-22,594,000
|
0
|
0
|
Issue of equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Dividends recognised as distributions to owners
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase through other contributions by owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Decrease through other distributions to owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through other changes, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through treasury share transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control, equity
|
0
|
0
|
0
|
-4,723,297,000
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through share-based payment transactions, equity
|
0
|
0
|
0
|
321,289,000
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of cash flow hedges and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of time value of options and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of forward elements of forward contracts and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of foreign currency basis spreads and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total increase (decrease) in equity
|
0
|
0
|
0
|
-3,801,574,000
|
0
|
132,855,000
|
-22,594,000
|
0
|
0
|
Equity at end of period
|
4,978,126,000
|
15,889,819,000
|
11,882,248,000
|
69,338,110,000
|
0
|
1,105,009,000
|
-175,858,000
|
0
|
0
|
|
Components of equity [axis]
|
Page 2 of 3
|
Reserve of change in value of forward elements of forward contracts [member]
|
Reserve of change in value of foreign currency basis spreads [member]
|
Reserve of gains and losses on remeasuring available-for-sale financial assets [member]
|
Reserve of share-based payments [member]
|
Reserve of remeasurements of defined benefit plans [member]
|
Amount recognised in other comprehensive income and accumulated in equity relating to non-current assets or disposal groups held for sale [member]
|
Reserve of gains and losses from investments in equity instruments [member]
|
Reserve of change in fair value of financial liability attributable to change in credit risk of liability [member]
|
Reserve for catastrophe [member]
|
Retrospective application and retrospective restatement [axis]
|
|
|
|
|
|
|
|
|
|
Statement of changes in equity [line items]
|
|
|
|
|
|
|
|
|
|
Equity at beginning of period
|
0
|
0
|
4,254,280,000
|
0
|
-126,845,000
|
0
|
0
|
0
|
0
|
Changes in equity [abstract]
|
|
|
|
|
|
|
|
|
|
Comprehensive income [abstract]
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Other comprehensive income
|
0
|
0
|
-28,210,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Total comprehensive income
|
0
|
0
|
-28,210,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Issue of equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Dividends recognised as distributions to owners
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase through other contributions by owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Decrease through other distributions to owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through other changes, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through treasury share transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through share-based payment transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of cash flow hedges and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of time value of options and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of forward elements of forward contracts and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of foreign currency basis spreads and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total increase (decrease) in equity
|
0
|
0
|
-28,210,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Equity at end of period
|
0
|
0
|
4,226,070,000
|
0
|
-126,845,000
|
0
|
0
|
0
|
0
|
|
Components of equity [axis]
|
Page 3 of 3
|
Reserve for equalisation [member]
|
Reserve of discretionary participation features [member]
|
Other comprehensive income [member]
|
Other reserves [member]
|
Equity attributable to owners of parent [member]
|
Non-controlling interests [member]
|
Equity [member]
|
Retrospective application and retrospective restatement [axis]
|
|
|
|
|
|
|
|
Statement of changes in equity [line items]
|
|
|
|
|
|
|
|
Equity at beginning of period
|
0
|
0
|
311,229,000
|
5,257,554,000
|
87,382,935,000
|
12,138,842,000
|
99,521,777,000
|
Changes in equity [abstract]
|
|
|
|
|
|
|
|
Comprehensive income [abstract]
|
|
|
|
|
|
|
|
Profit (loss)
|
0
|
0
|
0
|
0
|
600,434,000
|
380,849,000
|
981,283,000
|
Other comprehensive income
|
0
|
0
|
8,730,000
|
90,781,000
|
90,781,000
|
2,858,000
|
93,639,000
|
Total comprehensive income
|
0
|
0
|
8,730,000
|
90,781,000
|
691,215,000
|
383,707,000
|
1,074,922,000
|
Issue of equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Dividends recognised as distributions to owners
|
0
|
0
|
0
|
0
|
0
|
12,799,000
|
12,799,000
|
Increase through other contributions by owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Decrease through other distributions to owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through other changes, equity
|
0
|
0
|
0
|
0
|
0
|
438,000
|
438,000
|
Increase (decrease) through treasury share transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control, equity
|
0
|
0
|
0
|
0
|
-4,723,297,000
|
-449,940,000
|
-5,173,237,000
|
Increase (decrease) through share-based payment transactions, equity
|
0
|
0
|
0
|
0
|
321,289,000
|
0
|
321,289,000
|
Amount removed from reserve of cash flow hedges and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of time value of options and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of forward elements of forward contracts and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of foreign currency basis spreads and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total increase (decrease) in equity
|
0
|
0
|
8,730,000
|
90,781,000
|
-3,710,793,000
|
-78,594,000
|
-3,789,387,000
|
Equity at end of period
|
0
|
0
|
319,959,000
|
5,348,335,000
|
83,672,142,000
|
12,060,248,000
|
95,732,390,000
|
[
610000] Statement of changes in equity - Year Previous
|
Components of equity [axis]
|
Page 1 of 3
|
Issued capital [member]
|
Share premium [member]
|
Treasury shares [member]
|
Retained earnings [member]
|
Revaluation surplus [member]
|
Reserve of exchange differences on translation [member]
|
Reserve of cash flow hedges [member]
|
Reserve of gains and losses on hedging instruments that hedge investments in equity instruments [member]
|
Reserve of change in value of time value of options [member]
|
Retrospective application and retrospective restatement [axis]
|
|
|
|
|
|
|
|
|
|
Statement of changes in equity [line items]
|
|
|
|
|
|
|
|
|
|
Equity at beginning of period
|
4,978,126,000
|
15,889,819,000
|
12,647,475,000
|
62,905,444,000
|
0
|
348,429,000
|
-171,351,000
|
0
|
0
|
Changes in equity [abstract]
|
|
|
|
|
|
|
|
|
|
Comprehensive income [abstract]
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
0
|
0
|
0
|
1,453,445,000
|
0
|
0
|
0
|
0
|
0
|
Other comprehensive income
|
0
|
0
|
0
|
0
|
0
|
79,776,000
|
-30,168,000
|
0
|
0
|
Total comprehensive income
|
0
|
0
|
0
|
1,453,445,000
|
0
|
79,776,000
|
-30,168,000
|
0
|
0
|
Issue of equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Dividends recognised as distributions to owners
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase through other contributions by owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Decrease through other distributions to owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through other changes, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through treasury share transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through share-based payment transactions, equity
|
0
|
0
|
-134,325,000
|
86,330,000
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of cash flow hedges and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of time value of options and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of forward elements of forward contracts and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of foreign currency basis spreads and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total increase (decrease) in equity
|
0
|
0
|
-134,325,000
|
1,539,775,000
|
0
|
79,776,000
|
-30,168,000
|
0
|
0
|
Equity at end of period
|
4,978,126,000
|
15,889,819,000
|
12,513,150,000
|
64,445,219,000
|
0
|
428,205,000
|
-201,519,000
|
0
|
0
|
|
Components of equity [axis]
|
Page 2 of 3
|
Reserve of change in value of forward elements of forward contracts [member]
|
Reserve of change in value of foreign currency basis spreads [member]
|
Reserve of gains and losses on remeasuring available-for-sale financial assets [member]
|
Reserve of share-based payments [member]
|
Reserve of remeasurements of defined benefit plans [member]
|
Amount recognised in other comprehensive income and accumulated in equity relating to non-current assets or disposal groups held for sale [member]
|
Reserve of gains and losses from investments in equity instruments [member]
|
Reserve of change in fair value of financial liability attributable to change in credit risk of liability [member]
|
Reserve for catastrophe [member]
|
Retrospective application and retrospective restatement [axis]
|
|
|
|
|
|
|
|
|
|
Statement of changes in equity [line items]
|
|
|
|
|
|
|
|
|
|
Equity at beginning of period
|
0
|
0
|
5,175,039,000
|
0
|
35,422,000
|
0
|
0
|
0
|
0
|
Changes in equity [abstract]
|
|
|
|
|
|
|
|
|
|
Comprehensive income [abstract]
|
|
|
|
|
|
|
|
|
|
Profit (loss)
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Other comprehensive income
|
0
|
0
|
-194,495,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Total comprehensive income
|
0
|
0
|
-194,495,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Issue of equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Dividends recognised as distributions to owners
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase through other contributions by owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Decrease through other distributions to owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through other changes, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through treasury share transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through share-based payment transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of cash flow hedges and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of time value of options and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of forward elements of forward contracts and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of foreign currency basis spreads and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total increase (decrease) in equity
|
0
|
0
|
-194,495,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Equity at end of period
|
0
|
0
|
4,980,544,000
|
0
|
35,422,000
|
0
|
0
|
0
|
0
|
|
Components of equity [axis]
|
Page 3 of 3
|
Reserve for equalisation [member]
|
Reserve of discretionary participation features [member]
|
Other comprehensive income [member]
|
Other reserves [member]
|
Equity attributable to owners of parent [member]
|
Non-controlling interests [member]
|
Equity [member]
|
Retrospective application and retrospective restatement [axis]
|
|
|
|
|
|
|
|
Statement of changes in equity [line items]
|
|
|
|
|
|
|
|
Equity at beginning of period
|
0
|
0
|
291,524,000
|
5,679,063,000
|
76,804,977,000
|
11,110,104,000
|
87,915,081,000
|
Changes in equity [abstract]
|
|
|
|
|
|
|
|
Comprehensive income [abstract]
|
|
|
|
|
|
|
|
Profit (loss)
|
0
|
0
|
0
|
0
|
1,453,445,000
|
349,810,000
|
1,803,255,000
|
Other comprehensive income
|
0
|
0
|
-31,595,000
|
-176,482,000
|
-176,482,000
|
24,019,000
|
-152,463,000
|
Total comprehensive income
|
0
|
0
|
-31,595,000
|
-176,482,000
|
1,276,963,000
|
373,829,000
|
1,650,792,000
|
Issue of equity
|
0
|
0
|
0
|
0
|
0
|
-95,500,000
|
-95,500,000
|
Dividends recognised as distributions to owners
|
0
|
0
|
0
|
0
|
0
|
7,702,000
|
7,702,000
|
Increase through other contributions by owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Decrease through other distributions to owners, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through other changes, equity
|
0
|
0
|
0
|
0
|
0
|
-247,000
|
-247,000
|
Increase (decrease) through treasury share transactions, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through changes in ownership interests in subsidiaries that do not result in loss of control, equity
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Increase (decrease) through share-based payment transactions, equity
|
0
|
0
|
0
|
0
|
220,655,000
|
0
|
220,655,000
|
Amount removed from reserve of cash flow hedges and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of time value of options and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of forward elements of forward contracts and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Amount removed from reserve of change in value of foreign currency basis spreads and included in initial cost or other carrying amount of non-financial asset (liability) or firm commitment for which fair value hedge accounting is applied
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total increase (decrease) in equity
|
0
|
0
|
-31,595,000
|
-176,482,000
|
1,497,618,000
|
270,380,000
|
1,767,998,000
|
Equity at end of period
|
0
|
0
|
259,929,000
|
5,502,581,000
|
78,302,595,000
|
11,380,484,000
|
89,683,079,000
|
[700000] Informative data about the Statement of financial position
Concept
|
Close Current Quarter
2016-03-31
|
Close Previous Exercise
2015-12-31
|
Informative data of the Statement of Financial Position [abstract]
|
|
|
Capital stock (nominal)
|
2,494,410,000
|
2,494,410,000
|
Restatement of capital stock
|
2,483,716,000
|
2,483,716,000
|
Plan assets for pensions and seniority premiums
|
2,045,886,000
|
2,035,168,000
|
Number of executives
|
79
|
77
|
Number of employees
|
43423
|
43887
|
Number of workers
|
0
|
0
|
Outstanding shares
|
338215978659
|
338468382759
|
Repurchased shares
|
24213908472
|
23961504372
|
Restricted cash
|
0
|
0
|
Guaranteed debt of associated companies
|
0
|
0
|
[700002] Informative data about the Income statement
Concept
|
Accumulated Current Year
2016-01-01 - 2016-03-31
|
Accumulated Previous Year
2015-01-01 - 2015-03-31
|
Informative data of the Income Statement [abstract]
|
|
|
Operating depreciation and amortization
|
4,009,881,000
|
3,343,137,000
|
[700003] Informative data - Income statement for 12 months
Concept
|
Current Year
2015-04-01 - 2016-03-31
|
Previous Year
2014-04-01 - 2015-03-31
|
Informative data - Income Statement for 12 months [abstract]
|
|
|
Revenue
|
89,933,445,000
|
83,053,665,000
|
Profit (loss) from operating activities
|
17,243,981,000
|
15,782,968,000
|
Profit (loss)
|
11,503,478,000
|
7,279,285,000
|
Profit (loss), attributable to owners of parent
|
10,046,124,000
|
5,986,482,000
|
Operating depreciation and amortization
|
15,327,673,000
|
12,279,544,000
|
[800001] Breakdown of credits
Institution [axis]
|
Foreign institution (Yes/No)
|
Contract signing date
|
Expiration date
|
Interest rate
|
Denomination [axis]
|
Domestic currency [member]
|
Foreign currency [member]
|
Time interval [axis]
|
Time interval [axis]
|
Current year [member]
|
Until 1 year [member]
|
Until 2 year [member]
|
Until 3 year [member]
|
Until 4 year [member]
|
Until 5 year or more [member]
|
Current year [member]
|
Until 1 year [member]
|
Until 2 year [member]
|
Until 3 year [member]
|
Until 4 year [member]
|
Until 5 year or more [member]
|
Banking [abstract]
|
|
Foreign trade (banking)
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Banks – secured
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Commercial Banks
|
|
BANCO MERCANTIL DEL NORTE, S.A.1
|
NO
|
2015-05-15
|
2022-04-30
|
TIIE+1.30
|
|
|
221,880,000
|
242,051,000
|
242,051,000
|
1,032,889,000
|
|
|
|
|
|
|
HSBC 2
|
NO
|
2011-03-28
|
2018-03-30
|
TIIE+117.5
|
|
|
624,518,000
|
624,518,000
|
|
|
|
|
|
|
|
|
AF BANREGIO, S.A. DE C.V. 3
|
NO
|
2012-10-04
|
2017-10-02
|
TIIE+2.50
|
7,275,000
|
2,475,000
|
13,450,000
|
|
|
|
|
|
|
|
|
|
HSBC 4
|
NO
|
2013-05-29
|
2019-05-29
|
TIIE+1.70
|
48,363,000
|
16,121,000
|
64,839,000
|
64,839,000
|
179,970,000
|
|
|
|
|
|
|
|
HSBC 5
|
NO
|
2014-07-04
|
2019-07-04
|
TIIE+1.40
|
|
|
|
|
299,016,000
|
|
|
|
|
|
|
|
BANCO SANTANDER 6
|
NO
|
2015-03-12
|
2021-05-11
|
TIIE+1.30
|
|
|
|
|
|
249,510,000
|
|
|
|
|
|
|
BANCO SANTANDER 7
|
NO
|
2015-01-08
|
2019-09-10
|
TIIE+1.40
|
|
|
|
|
249,283,000
|
|
|
|
|
|
|
|
HSBC 8
|
NO
|
2016-03-08
|
2023-03-08
|
7.13
|
|
|
|
|
|
2,500,000,000
|
|
|
|
|
|
|
SCOTIABANK 9
|
NO
|
2016-03-08
|
2023-03-08
|
7
|
|
|
|
|
|
3,000,000,000
|
|
|
|
|
|
|
TOTAL
|
NO
|
|
|
|
55,638,000
|
18,596,000
|
924,687,000
|
931,408,000
|
970,320,000
|
6,782,399,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Other banks
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total banks
|
|
TOTAL
|
NO
|
|
|
|
55,638,000
|
18,596,000
|
924,687,000
|
931,408,000
|
970,320,000
|
6,782,399,000
|
0
|
0
|
0
|
0
|
0
|
0
|
Stock market (abstract)
|
|
Listed on stock Exchange – unsecured
|
|
"SENIOR NOTES" 1
|
SI
|
2007-05-09
|
2037-05-11
|
8.93
|
|
|
|
|
|
4,484,653,000
|
|
|
|
|
|
|
CERTIFICADOS BURSATILES 1
|
NO
|
2010-10-14
|
2020-10-01
|
7.38
|
|
|
|
|
|
9,967,673,000
|
|
|
|
|
|
|
"SENIOR NOTES" 2
|
SI
|
2013-05-14
|
2043-05-14
|
7.25
|
|
|
|
|
|
6,435,658,000
|
|
|
|
|
|
|
CERTIFICADOS BURSATILES 2
|
NO
|
2014-04-07
|
2021-04-01
|
TIIE+0.35
|
|
|
|
|
|
5,989,483,000
|
|
|
|
|
|
|
CERTIFICADOS BURSATILES 3
|
NO
|
2015-05-11
|
2022-05-02
|
TIIE+0.35
|
|
|
|
|
|
4,989,372,000
|
|
|
|
|
|
|
"SENIOR NOTES" 3
|
SI
|
2008-05-06
|
2018-05-15
|
6.31
|
|
|
|
|
|
|
|
|
|
8,622,854,000
|
|
|
"SENIOR NOTES" 4
|
SI
|
2005-03-18
|
2025-03-18
|
6.97
|
|
|
|
|
|
|
|
|
|
|
|
10,020,095,000
|
"SENIOR NOTES" 5
|
SI
|
2002-03-11
|
2032-03-11
|
8.94
|
|
|
|
|
|
|
|
|
|
|
|
5,154,181,000
|
"SENIOR NOTES" 6
|
SI
|
2009-11-23
|
2040-01-15
|
6.97
|
|
|
|
|
|
|
|
|
|
|
|
10,214,142,000
|
"SENIOR NOTES" 7
|
SI
|
2014-05-13
|
2045-05-13
|
5
|
|
|
|
|
|
|
|
|
|
|
|
16,781,495,000
|
"SENIOR NOTES" 8
|
SI
|
2015-11-24
|
2026-01-30
|
4.625
|
|
|
|
|
|
|
|
|
|
|
|
5,134,420,000
|
"SENIOR NOTES" 9
|
SI
|
2015-11-24
|
2046-01-31
|
6.125
|
|
|
|
|
|
|
|
|
|
|
|
15,405,296,000
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
31,866,839,000
|
0
|
0
|
0
|
8,622,854,000
|
0
|
62,709,629,000
|
Listed on stock exchange – secured
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Private placements – unsecured
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Private placements – secured
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total listed on stock exchanges and prívate placements
|
|
Institution [axis]
|
Foreign institution (Yes/No)
|
Contract signing date
|
Expiration date
|
Interest rate
|
Denomination [axis]
|
Domestic currency [member]
|
Foreign currency [member]
|
Time interval [axis]
|
Time interval [axis]
|
Current year [member]
|
Until 1 year [member]
|
Until 2 year [member]
|
Until 3 year [member]
|
Until 4 year [member]
|
Until 5 year or more [member]
|
Current year [member]
|
Until 1 year [member]
|
Until 2 year [member]
|
Until 3 year [member]
|
Until 4 year [member]
|
Until 5 year or more [member]
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
31,866,839,000
|
0
|
0
|
0
|
8,622,854,000
|
0
|
62,709,629,000
|
Other current and non-current liabilities with cost [abstract]
|
|
Other currents and non-current liabilities with cost
|
|
ALD AUTOMOTIVE, S.A. DE C.V. 1
|
NO
|
2013-12-01
|
2016-04-01
|
|
1,769,000
|
|
|
|
|
|
|
|
|
|
|
|
GE CAPITAL CFE MÉXICO, S. DE R.L. DE C.V. 2
|
NO
|
2014-11-01
|
2017-11-01
|
|
19,375,000
|
7,352,000
|
25,493,000
|
16,532,000
|
24,063,000
|
|
|
|
|
|
|
|
GE CAPITAL CFE MÉXICO, S. DE R.L. DE C.V. 1
|
NO
|
2014-07-01
|
2019-08-01
|
|
20,310,000
|
6,655,000
|
26,074,000
|
25,244,000
|
11,144,000
|
|
|
|
|
|
|
|
GRUPO DE TELECOMUNICACIONES DE ALTA CAPACIDAD 1
|
NO
|
2012-08-08
|
2020-07-01
|
|
100,923,000
|
|
89,062,000
|
90,818,000
|
92,996,000
|
95,556,000
|
|
|
|
|
|
|
CVQ 1
|
NO
|
2016-03-01
|
2020-03-04
|
|
|
|
1,125,730,000
|
1,187,500,000
|
1,187,500,000
|
|
|
|
|
|
|
|
GRUPO DE TELECOMUNICACIONES DE ALTA CAPACIDAD 3
|
NO
|
2014-11-01
|
2022-11-01
|
|
8,824,000
|
|
3,001,000
|
3,100,000
|
3,183,000
|
10,130,000
|
|
|
|
|
|
|
GRUPO DE TELECOMUNICACIONES DE ALTA CAPACIDAD 4
|
NO
|
2014-11-01
|
2022-11-01
|
|
10,436,000
|
5,290,000
|
5,502,000
|
5,600,000
|
5,746,000
|
24,607,000
|
|
|
|
|
|
|
GRUPO DE TELECOMUNICACIONES DE ALTA CAPACIDAD 2
|
NO
|
2012-08-01
|
2023-07-01
|
|
45,710,000
|
|
20,797,000
|
21,736,000
|
22,638,000
|
48,200,000
|
|
|
|
|
|
|
CISCO SYSTEMS CAPITAL CORPORATION 1
|
SI
|
2012-10-10
|
2016-08-27
|
|
|
|
|
|
|
|
8,672,000
|
4,578,000
|
|
|
|
|
GE CAPITAL CFE MÉXICO, S. DE R.L. DE C.V. 3
|
NO
|
2013-05-29
|
2017-07-01
|
|
|
|
|
|
|
|
3,478,000
|
1,199,000
|
1,888,000
|
|
|
|
INTELSAT GLOBAL SALES 1
|
SI
|
2012-10-01
|
2027-09-01
|
|
|
|
|
|
|
|
206,957,000
|
71,534,000
|
299,515,000
|
322,127,000
|
346,445,000
|
3,583,516,000
|
TOTAL
|
NO
|
|
|
|
207,347,000
|
19,297,000
|
1,295,659,000
|
1,350,530,000
|
1,347,270,000
|
178,493,000
|
219,107,000
|
77,311,000
|
301,403,000
|
322,127,000
|
346,445,000
|
3,583,516,000
|
Total other current and non-current liabilities with cost
|
|
TOTAL
|
NO
|
|
|
|
207,347,000
|
19,297,000
|
1,295,659,000
|
1,350,530,000
|
1,347,270,000
|
178,493,000
|
219,107,000
|
77,311,000
|
301,403,000
|
322,127,000
|
346,445,000
|
3,583,516,000
|
Suppliers [abstract]
|
|
Suppliers
|
|
PROVEEDORES 1
|
NO
|
2015-04-01
|
2021-03-31
|
|
|
15,591,833,000
|
|
|
|
|
|
6,751,939,000
|
|
|
|
|
DERECHOS DE TRANSMISION 1
|
NO
|
2010-09-01
|
2028-06-27
|
|
|
320,135,000
|
133,291,000
|
12,320,000
|
10,524,000
|
61,498,000
|
|
162,232,000
|
1,714,218,000
|
670,180,000
|
197,388,000
|
321,420,000
|
TOTAL
|
NO
|
|
|
|
0
|
15,911,968,000
|
133,291,000
|
12,320,000
|
10,524,000
|
61,498,000
|
0
|
6,914,171,000
|
1,714,218,000
|
670,180,000
|
197,388,000
|
321,420,000
|
Total suppliers
|
|
TOTAL
|
NO
|
|
|
|
0
|
15,911,968,000
|
133,291,000
|
12,320,000
|
10,524,000
|
61,498,000
|
0
|
6,914,171,000
|
1,714,218,000
|
670,180,000
|
197,388,000
|
321,420,000
|
Other current and non-current liabilities [abstract]
|
|
Other current and non-current liabilities
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total other current and non-current liabilities
|
|
TOTAL
|
NO
|
|
|
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total credits
|
|
TOTAL
|
NO
|
|
|
|
262,985,000
|
15,949,861,000
|
2,353,637,000
|
2,294,258,000
|
2,328,114,000
|
38,889,229,000
|
219,107,000
|
6,991,482,000
|
2,015,621,000
|
9,615,161,000
|
543,833,000
|
66,614,565,000
|
[800003] Annex - Monetary foreign currency position
|
Currencies [axis]
|
|
Dollars [member]
|
Dollar equivalent in pesos [member]
|
Other currencies equivalent in dollars [member]
|
Other currencies equivalent in pesos [member]
|
Total pesos [member]
|
Foreign currency position [abstract]
|
|
|
|
|
|
Monetary assets [abstract]
|
|
|
|
|
|
Current monetary assets
|
2,511,667,000
|
43,388,545,000
|
57,346,000
|
990,641,000
|
44,379,186,000
|
Non-current monetary assets
|
180,000,000
|
3,109,464,000
|
0
|
0
|
3,109,464,000
|
Total monetary assets
|
2,691,667,000
|
46,498,009,000
|
57,346,000
|
990,641,000
|
47,488,650,000
|
Liabilities position [abstract]
|
|
|
|
|
|
Current liabilities
|
525,682,000
|
9,081,051,000
|
38,837,000
|
670,901,000
|
9,751,952,000
|
Non-current liabilities
|
4,599,300,000
|
78,230,310,000
|
39,372,000
|
680,143,000
|
78,910,453,000
|
Total liabilities
|
5,124,982,000
|
87,311,361,000
|
78,209,000
|
1,351,044,000
|
88,662,405,000
|
Net monetary assets (liabilities)
|
-2,433,315,000
|
-40,813,352,000
|
-20,863,000
|
-360,403,000
|
-41,173,755,000
|
[800005] Annex - Distribution of income by product
|
Income type [axis]
|
|
National income [member]
|
Export income [member]
|
Income of subsidiaries abroad [member]
|
Total income [member]
|
CONTENT:
|
|
|
|
|
CONTENT:
|
0
|
0
|
0
|
0
|
TELEVISA
|
|
|
|
|
CONTENT – ADVERTISING
|
4,344,251,000
|
83,608,000
|
50,904,000
|
4,478,763,000
|
CONTENT – NETWORK SUSCRIPTION REVENUE
|
758,604,000
|
319,264,000
|
0
|
1,077,868,000
|
CONTENT – LICENSING AND SYNDICATION
|
118,419,000
|
1,851,386,000
|
0
|
1,969,805,000
|
SKY (INCLUDES LEASING OF SET-TOP EQUIPMENT):
|
|
|
|
|
SKY (INCLUDE LEASING OF SET-TOP EQUIPMENT):
|
0
|
0
|
0
|
0
|
SKY, VETV, BLUE TO GO
|
|
|
|
|
SKY – DTH BROADCAST SATELLITE TV
|
4,883,847,000
|
0
|
368,374,000
|
5,252,221,000
|
SKY – PAY PER VIEW
|
14,576,000
|
0
|
0
|
14,576,000
|
SKY - ADVERTISING
|
82,822,000
|
0
|
0
|
82,822,000
|
CABLE (INCLUDE LEASING OF SET-TOP EQUIPMENT):
|
|
|
|
|
CABLE (INCLUDE LEASING OF SET-TOP EQUIPMENT):
|
0
|
0
|
0
|
0
|
CABLEVISIÓN, CABLEMÁS, TVI, CABLECOM, IZZI, TELECABLE
|
|
|
|
|
CABLE – DIGITAL TV SERVICE
|
3,220,329,000
|
0
|
0
|
3,220,329,000
|
CABLE – BROADBAND SERVICES
|
2,296,049,000
|
0
|
0
|
2,296,049,000
|
CABLE - SERVICE INSTALLATION
|
41,698,000
|
0
|
0
|
41,698,000
|
CABLE – PAY PER VIEW
|
18,204,000
|
0
|
0
|
18,204,000
|
CABLE - ADVERTISING
|
154,201,000
|
0
|
0
|
154,201,000
|
CABLE – TELEPHONY
|
786,486,000
|
0
|
0
|
786,486,000
|
CABLE – OTHER INCOME
|
57,035,000
|
0
|
0
|
57,035,000
|
BESTEL, METRORED
|
|
|
|
|
CABLE – TELECOMMUNICATIONS
|
960,332,000
|
0
|
86,780,000
|
1,047,112,000
|
OTHER BUSINESSES:
|
|
|
|
|
OTHER BUSINESSES:
|
0
|
0
|
0
|
0
|
TV Y NOVELAS, MEN´S HEALTH, VANIDADES, COSMOPOLITAN, NATIONAL GEOGRAPHIC, MUY INTERESANTE, AUTOMOVIL PANAMERICANO, TÚ, SKY VIEW, COCINA FÁCIL, GENTE, PAPARAZZI, BILINKEN, PARA TI, CONDORITO
|
|
|
|
|
PUBLISHING – MAGAZINE CIRCULATION
|
109,861,000
|
0
|
118,919,000
|
228,780,000
|
PUBLISHING – ADVERTISING
|
145,111,000
|
0
|
107,427,000
|
252,538,000
|
PUBLISHING - OTHER INCOME
|
2,461,000
|
0
|
0
|
2,461,000
|
VIDEOCINE, PANTELION
|
|
|
|
|
DISTRIBUTION, RENTALS AND SALE MOVIE RIGHTS
|
81,186,000
|
0
|
32,804,000
|
113,990,000
|
CLUB DE FÚTBOL AMÉRICA, ESTADIO AZTECA
|
|
|
|
|
SPECIAL EVENTS AND SHOW PROMOTION
|
290,741,000
|
21,098,000
|
0
|
311,839,000
|
PLAY CITY, MULTIJUEGOS
|
|
|
|
|
GAMING
|
621,910,000
|
0
|
0
|
621,910,000
|
TELEVISA RADIO
|
|
|
|
|
RADIO – ADVERTISING
|
169,559,000
|
0
|
0
|
169,559,000
|
HOLA MÉXICO, ENTREPRENEUR, MINIREVISTA MINA, MONSTER HIGH, GLAMOUR, SELECCIONES, MAGALY TV, VOGUE, 15 MINUTOS, AXXIS, EL CUERPO HUMANO, ALMANAQUE, ESCUELA PARA TODOS
|
|
|
|
|
PUBLISHING DISTRIBUTION
|
51,392,000
|
0
|
22,547,000
|
73,939,000
|
INTERSEGMENT ELIMINATIONS
|
|
|
|
|
INTERSEGMENT ELIMINATIONS
|
-526,566,000
|
0
|
-4,640,000
|
-531,206,000
|
TOTAL
|
18,682,508,000
|
2,275,356,000
|
783,115,000
|
21,740,979,000
|
[800007] Annex - Financial derivate instruments
Management discussion about the policy uses of financial derivate instruments, explaining if these policies are allowed just for coverage or for other uses like trading
|
EXHIBIT 1
TO THE ELECTRONIC FORM TITLED “PREPARATION, FILING, DELIVERY AND DISCLOSURE OF QUARTERLY ECONOMIC, ACCOUNTING AND ADMINISTRATIVE INFORMATION BY ISSUERS”
III. QUALITATIVE AND QUANTITATIVE INFORMATION
i.
Management’s discussion of the policies concerning the use of financial derivative instruments, and explanation as to whether such policies permit the use of said instruments solely for hedging or also for trading or other purposes. The discussion must include a general description of the objectives sought in the execution of financial derivative transactions; the relevant instruments; the hedging or trading strategies implemented in connection therewith; the relevant trading markets; the eligible counterparties; the policies for the appointment of calculation or valuation agents; the principal terms and conditions of the relevant contracts; the policies as to margins, collateral and lines of credit; the authorization process and levels of authorization required by type of transaction (e.g., full hedging, partial hedging, speculation), stating whether the transactions were previously approved by the committee(s) responsible for the development of corporate and auditing practices; the internal control procedures applicable to the management of the market and liquidity risks associated with the positions; and the existence of an independent third party responsible for the review of such procedures and, as the case may be, the observations raised or deficiencies identified by such third party. If applicable, provide information concerning the composition of the overall risk management committee, its operating rules, and the existence of an overall risk management manual
.
Management’s discussion of the policies concerning the use of financial derivative instruments, and explanation as to whether such policies permit the use of said instruments solely for hedging or also for trading or other purposes.
In accordance with the policies and procedures implemented by the Vice President of Finance and Risk and the Vice President and Corporate Controller, along with the Vice President of Internal Audit, the Company has entered into certain financial derivative transactions for hedging purposes in both the Mexican and international markets so as to manage its exposure to the market risks associated with the changes in interest and foreign exchange rates and inflation. In addition, the Company’s Investments Committee has established guidelines for the investment in structured notes or deposits associated with other derivatives, which by their nature may be considered as derivative transactions for trading purposes. It should be noted that in the fourth quarter of 2015, no such financial derivatives were outstanding. Pursuant to the provisions of International Financial Reporting Standards Board, certain financial derivative transactions originally intended to serve as a hedge and in effect until December 31st, 2015, are not within the scope of hedge accounting as specified in such Standards and, consequently, are recognized in the accounting based on the provisions included in the aforementioned Standards.
General description of the objectives sought in the execution of financial derivative transactions; the relevant instruments; the hedging or trading strategies implemented in connection therewith; the relevant trading markets; the eligible counterparties; the policies for the appointment of calculation or valuation agents; the principal terms and conditions of the relevant contracts; the policies as to margins, collateral and lines of credit; the authorization process and levels of authorization required by type of transaction (e.g., full hedging, partial hedging, speculation), stating whether the transactions were previously approved by the committee(s) responsible for the development of corporate and auditing practices; the internal control procedures applicable to the management of the market and liquidity risks associated with the positions; and the existence of an independent third party responsible for the review of such procedures and, as the case may be, the observations raised or deficiencies identified by such third party.
The Company’s principal objective when entering into financial derivative transactions is to mitigate the effects of unforeseen changes in interest and foreign exchange rates and inflation, so as to reduce the volatility in its results and cash flows as a result of such changes.
The Company monitors its exposure to the interest rate risk by: (i) assessing the difference between the interest rates applicable to its debt and temporary investments, and the prevailing market rates for similar instruments; (ii) reviewing its cash flow requirements and financial ratios (interest coverage); (iii) assessing the actual and budgeted-for trends in the principal markets; and (iv) assessing the prevailing industry practices and other similar companies. This approach enables the Company to determine the optimum mix between fixed- and variable-rate interest for its debt.
Foreign exchange risk is monitored by assessing the Company’s monetary position in U.S. dollars and its budgeted cash flow requirements for investments anticipated to be denominated in U.S. dollars and the service of its U.S. dollar-denominated debt.
Financial derivative transactions are reported from time to time to the Audit and Corporate Practices Committee.
The Company has entered into master derivatives agreements with both domestic and foreign financial institutions, that are internationally recognized institutions with which the Company, from time to time, has entered into financial transactions involving corporate and investment banking, as well as treasury services. The form agreement used in connection with financial derivatives transactions with foreign financial institutions is the Master Agreement published by the International Swaps and Derivatives Association, Inc. (“ISDA”) and with local institutions is the Master Agreement published by ISDA and in some instances, using the form agreement ISDAmex
.
In both cases, the main terms and conditions are standard for these types of transactions and include mechanisms for the appointment of calculation or valuation agents.
In addition, the Company enters into standard guaranty agreements that set forth the margins, collateral and lines of credit applicable in each instance. These agreements establish the credit limits granted by the financial institutions with whom the Company enters into master financial derivative agreements, which specify the margin implications in the case of potential negative changes in the market value of its open financial derivative positions. Pursuant to the agreements entered into by the Company, financial institutions are entitled to make margin calls if certain thresholds are exceeded. In the event of a change in the credit rating issued to the Company by a recognized credit rating agency, the credit limit granted by each counterparty would be modified.
As of the date hereof, the Company has never experienced a margin call with respect to its financial derivative transactions.
In compliance with its risk management objectives and hedging strategies, the Company generally utilizes the following financial derivative transactions:
1.
Cross-currency interest rate swaps (i.e., coupon swaps);
2.
Interest rate and inflation-indexed swaps;
3.
Cross-currency principal and interest rate swaps;
4.
Swaptions;
5.
Forward exchange rate contracts;
6.
FX options;
7.
Interest Rate Caps and Floors contracts;
8.
Fixed-price contracts for the acquisition of government securities (i.e., Treasury locks); and
9.
Credit Default Swaps.
The strategies for the acquisition of financial derivatives transactions are approved by the Risk Management Committee in accordance with the Policies and Objectives for the Use of Financial Derivatives.
During the quarter from October to December 2015, there were no defaults or margin calls under the aforementioned financial derivative transactions.
The Company monitors on a weekly basis the flows generated by the fair market value of and the potential for margin calls under its open financial derivative transactions. The calculation or valuation agent designated in the relevant Master Agreement, which is always the counterparty, issues monthly reports as to the fair market value of the Company’s open positions.
The Risk Management area is responsible for measuring, at least once a month, the Company’s exposure to the financial market risks associated with its financings and investments, and for submitting a report with respect to the Company’s risk position and the valuation of its financial derivatives to the Finance Committee on a monthly basis, and to the Risk Management Committee on a quarterly basis. The Company monitors the credit rating assigned to its counterparties in its outstanding financial derivative transactions on a regular basis.
The office of the Comptroller is responsible for the validation of the Company’s accounting records as related to its financial derivative transactions, based upon the confirmations received from the relevant financial intermediaries, and for obtaining from such intermediaries, on a monthly basis, confirmations or account statements supporting the market valuation of its open financial derivative positions.
As a part of the yearly audit on the Company, the aforementioned procedures are reviewed by the Company’s external auditors. As of the date hereof, the Company’s auditors have not raised any observation or identified any deficiency therein.
Information concerning the composition of the overall risk management committee, its operating rules, and the existence of an overall risk management manual.
The Company has a Risk Management Committee, which is responsible for monitoring the Company’s risk management activities and approving the hedging strategies used to mitigate the financial market risks to which the Company is exposed. The assessment and hedging of the financial market risks are subject to the policies and procedures applicable to the Company’s Risk Management Committee, the Finance and Risk Management areas and the Comptroller that form the Risk Management Manual of the Company. In general terms, the Risk Management Committee is comprised of members of the Corporate Management, Corporate Comptroller, Tax Control and Advice, Information to the Stock Exchange, Finance and Risk, Legal, Administration and Finance, Financial Planning and Corporate Finance areas.
General description about valuation techniques, standing out the instruments valuated at cost or fair value, just like methods and valuation techniques
|
ii.
General description of the valuation methods, indicating whether the instruments are valued at cost or at their fair value pursuant to the applicable accounting principles, the relevant reference valuation methods and techniques, and the events taken into consideration. Describe the policies for and frequency of the valuation, as well as the actions taken in light of the values obtained therefrom. Clarify whether the valuation is performed by an independent third party, and indicate if such third party is the structurer, seller or counterparty of the financial instrument. As with respect to financial derivative transactions for hedging purposes, explain the method used to determine the effectiveness thereof and indicate the level of coverage provided thereby
.
The Company values its financial derivative instruments based upon the standard models and calculators provided by recognized market makers. In addition, the Company uses the relevant market variables available from online sources. The financial derivative instruments are valued at a reasonable value pursuant to the applicable accounting provisions.
In the majority of cases, the valuation at a reasonable value is carried out on a monthly basis based on valuations of the counterparties and the verification of such reasonable value with internal valuations prepared by the
Risk Management area of the Company. Accounting wise, the valuation of the counterparty is registered.
The Company performs its valuations without the participation of any independent third party.
The method used by the Company to determine the effectiveness of an instrument depends on the hedging strategy and on whether the relevant transaction is intended as a fair-value hedge or a cash-flow hedge. The Company’s methods take into consideration the prospective cash flows generated by or the changes in the fair value of the financial derivative, and the cash flows generated by or the changes in the fair value of the underlying position that it seeks to hedge to determine, in each case, the hedging ratio.
Management discussion about intern and extern sources of liquidity that could be used for attending requirements related to financial derivate instruments
|
iii.
Management’s discussion of the internal and external sources of liquidity that could be used to satisfy the Company’s requirements in connection with its financial derivatives
.
As of the date hereof, the Company’s management has not discussed internal and external sources of liquidity so as to satisfy its requirements in connection with its financial derivatives since, based upon the aggregate amount of the Company’s financial derivative transactions, management is of the opinion that the Company’s significant positions of cash, cash equivalents and temporary investments, and the substantial cash flows generated by the Company, would enable the Company to respond adequately to any such requirements.
Changes and management explanation in principal risk exposures identified, as contingencies and events known by the administration that could affect future reports
|
iv.
Explanation as to any change in the issuer’s exposure to the principal risks identified thereby and in their management, and any contingency or event known to or anticipated by the issuer’s management, which could affect any future report. Description of any circumstance or event, such as any change in the value of the underlying assets or reference variables, resulting in a financial derivative being used other than as originally intended, or substantially altering its structure, or resulting in the partial or total loss of the hedge, thereby forcing the Issuer to assume new obligations, commitments or changes in its cash flows in a manner that affects its liquidity (e.g., margin calls). Description of the impact of such financial derivative transactions on the issuer’s results or cash flows. Description and number of financial derivatives maturing during the quarter, any closed positions and, if applicable, number and amount of margin calls experienced during the quarter. Disclosure as to any default under the relevant contracts
.
Changes in the Company’s exposure to the principal risks identified thereby and in their management, and contingencies or events known to or anticipated by the Company’s management, which could affect any future report
.
Since a significant portion of the Company’s debt and costs are denominated in U.S. dollars, while its revenues are primarily denominated in Mexican pesos, depreciation in the value of the Mexican peso against the U.S. dollar and any future depreciation could have a negative effect on the Company’s results due to exchange rate losses. However, the significant amount of U.S. dollars in the Company’s treasury, and the hedging strategies adopted by the Company in recent years, have enabled it to avoid significant foreign exchange losses.
Circumstances or events, such as changes in the value of the underlying assets or reference variables, resulting in a financial derivative being used other than as originally intended, or substantially altering its structure, or resulting in the partial or total loss of the hedge, thereby forcing the Company to assume new obligations, commitments or changes in its cash flows in a manner that affects its liquidity (e.g., margin calls). Description of the impact of such financial derivative transactions on the Company’s results or cash flows.
1.
During the relevant quarter, Grupo Televisa, S.A.B. (“Televisa”) partially prepaid the variable rate loan in the amount of $2,500,000,000.00 (Two Billion Five Hundred Million Pesos 00/100) due 2018. As a result of such partial prepayment, Televisa partially unwinded the "Interest Rate Swap" through which it exchanged the payment of variable interest rate coupons for fixed rate coupons in Mexican Pesos in the amount of $1,250,000,000.00 (One Billion Two Hundred and Fifty Million Pesos 00/100).
As of the date hereof, no circumstance or event of a financial derivative transaction, resulted in a partial or total loss of the relevant hedge requiring that the Company assume new obligations, commitments or variations in its cash flow such that its liquidity is affected.
Description and number of financial derivatives maturing during the quarter, any closed positions and, if applicable, number and amount of margin calls experienced during the quarter. Disclosure as to any default under the relevant contracts.
During the relevant quarter, no financial derivatives matured nor any position was closed.
.
Likewise there were no defaults or margin calls under financial derivative transactions.
Quantitative information for disclosure
|
v.
Quantitative Information
. Attached hereto as
Table 1
is a summary of the financial derivative instruments purchased by Televisa and Televisión Internacional, S.A. de C.V., whose aggregate fair value represents or could represent one of the reference percentages set forth in Section III (v) of the Official Communication.
IV. SENSITIVITY ANALYSIS
Considering that the Company has entered into financial derivative transactions for hedging purposes, and given the low amount of the financial derivative instruments that proved ineffective as a hedge, the Company has determined that such transactions are not material and, accordingly, the sensitivity analysis referred to in Section IV of the Official Communication is not applicable.
In those cases where the derivative instruments of the Company are for hedging purposes, for a material amount and where the effectiveness measures were sufficient, the measures are justified when the standard deviation of the changes in cash flow as a result of changes in the variables of exchange rate and interest rates of the derivative instruments used jointly with the underlying position is lower than the standard deviation of the changes in cash flow of the underlying position valued in pesos and the effective measures are defined by the correlation coefficient between both positions for the effective measures to be sufficient.
GRUPO TELEVISA, S.A.B.
Summary of Financial Derivative Instruments as of
March 31, 2016
(In thousands of pesos/dollars)
|
Type of Derivative, Securities or
Contract
|
Purpose (e.g., hedging, trading or other)
|
Notional Amount/Face Value
|
Value of the Underlying Asset / Reference Variable
|
Fair Value
|
Maturing per Year
|
Collateral/
Lines of Credit/
Securities Pledged
|
Current Quarter (3)
|
Previous Quarter (4)
|
Current Quarter D(H) (3)
|
Previous Quarter D(H) (4)
|
Interest Rate Swap (1)
|
Hedging
|
Ps. 1,250,000
|
TIIE 28 days / 7.4325%
|
TIIE 28 days / 7.4325%
|
(60,791)
|
(116,108)
|
Monthly interest
2016-2018
|
Does not exist (5)
|
Interest Rate Swap (1)
|
Hedging
|
Ps. 6,000,000
|
TIIE 28 days / 5.9351%
|
TIIE 28 days / 5.9351%
|
(177,340)
|
(99,567)
|
Monthly interest
2016-2021
|
Does not exist (5)
|
Interest Rate Swap (1)
|
Hedging
|
Ps. 2,500,000
|
TIIE 28 days / 5.6148%
|
TIIE 28 days / 5.9075%
|
(13,095)
|
(3,274)
|
Monthly interest
2016-2022
|
Does not exist (5)
|
Interest Rate Swap (2)
|
Hedging
|
Ps.1,425,417
|
TIIE 28 days / 5.246%
|
TIIE 28 days / 5.148%
|
(9,457)
|
(8,113)
|
Monthly Interest
2016-2022
|
Does not exist (5)
|
|
|
|
|
Total
|
(260,683)
|
(227,062)
|
|
|
(1)
Acquired by Grupo Televisa, S.A.B.
(2)
Acquired by Televisión Internacional, S.A. de C.V.
(3)
The aggregate amount of the derivatives reflected in the consolidated statement of financial position of Grupo Televisa, S.A.B. as March 31, 2016, included in the relevant SIFIC, is as follows:
|
Other non-current financial liabilities
|
|
Ps. (260,683)
|
|
|
|
|
|
Ps. (260,683)
|
|
|
(4)
Information for as of December 31 2015.
(5)
Applies only to implicit financing in the ISDA ancillary agreements identified as “Credit Support Annex”.
[800100] Notes - Subclassifications of assets, liabilities and equities
Concept
|
Close Current Quarter
2016-03-31
|
Close Previous Exercise
2015-12-31
|
Subclassifications of assets, liabilities and equities [abstract]
|
|
|
Cash and cash equivalents [abstract]
|
|
|
Cash [abstract]
|
|
|
Cash on hand
|
76,117,000
|
52,434,000
|
Balances with banks
|
1,837,244,000
|
1,513,161,000
|
Total cash
|
1,913,361,000
|
1,565,595,000
|
Cash equivalents [abstract]
|
|
|
Short-term deposits, classified as cash equivalents
|
51,651,810,000
|
47,831,531,000
|
Short-term investments, classified as cash equivalents
|
0
|
0
|
Other banking arrangements, classified as cash equivalents
|
0
|
0
|
Total cash equivalents
|
51,651,810,000
|
47,831,531,000
|
Other cash and cash equivalents
|
0
|
0
|
Total cash and cash equivalents
|
53,565,171,000
|
49,397,126,000
|
Trade and other current receivables [abstract]
|
|
|
Current trade receivables
|
16,458,742,000
|
21,702,128,000
|
Current receivables due from related parties
|
135,845,000
|
98,388,000
|
Current prepayments [abstract]
|
|
|
Current advances to suppliers
|
0
|
0
|
Current prepaid expenses
|
2,090,977,000
|
1,448,627,000
|
Total current prepayments
|
2,090,977,000
|
1,448,627,000
|
Current receivables from taxes other than income tax
|
1,265,392,000
|
1,499,338,000
|
Current value added tax receivables
|
1,244,217,000
|
1,462,792,000
|
Current receivables from sale of properties
|
0
|
0
|
Current receivables from rental of properties
|
0
|
0
|
Other current receivables
|
1,736,306,000
|
1,481,903,000
|
Total trade and other current receivables
|
21,687,262,000
|
26,230,384,000
|
Classes of current inventories [abstract]
|
|
|
Current raw materials and current production supplies [abstract]
|
|
|
Current raw materials
|
0
|
0
|
Current production supplies
|
0
|
0
|
Total current raw materials and current production supplies
|
0
|
0
|
Current merchandise
|
0
|
0
|
Current work in progress
|
0
|
0
|
Current finished goods
|
0
|
0
|
Current spare parts
|
0
|
0
|
Property intended for sale in ordinary course of business
|
0
|
0
|
Other current inventories
|
1,779,615,000
|
1,628,276,000
|
Total current inventories
|
1,779,615,000
|
1,628,276,000
|
Non-current assets or disposal groups classified as held for sale or as held for distribution to owners [abstract]
|
|
|
Non-current assets or disposal groups classified as held for sale
|
0
|
0
|
Non-current assets or disposal groups classified as held for distribution to owners
|
0
|
0
|
Total non-current assets or disposal groups classified as held for sale or as held for distribution to owners
|
0
|
0
|
Trade and other non-current receivables [abstract]
|
|
|
Non-current trade receivables
|
0
|
0
|
Non-current receivables due from related parties
|
0
|
0
|
Non-current prepayments
|
0
|
0
|
Non-current lease prepayments
|
0
|
0
|
Non-current receivables from taxes other than income tax
|
0
|
0
|
Concept
|
Close Current Quarter
2016-03-31
|
Close Previous Exercise
2015-12-31
|
Non-current value added tax receivables
|
0
|
0
|
Non-current receivables from sale of properties
|
0
|
0
|
Non-current receivables from rental of properties
|
0
|
0
|
Revenue for billing
|
0
|
0
|
Other non-current receivables
|
0
|
0
|
Total trade and other non-current receivables
|
0
|
0
|
Investments in subsidiaries, joint ventures and associates [abstract]
|
|
|
Investments in subsidiaries
|
0
|
0
|
Investments in joint ventures
|
639,668,000
|
642,348,000
|
Investments in associates
|
8,974,371,000
|
8,629,553,000
|
Total investments in subsidiaries, joint ventures and associates
|
9,614,039,000
|
9,271,901,000
|
Property, plant and equipment [abstract]
|
|
|
Land and buildings [abstract]
|
|
|
Land
|
4,700,809,000
|
4,699,723,000
|
Buildings
|
4,673,721,000
|
4,731,004,000
|
Total land and buildings
|
9,374,530,000
|
9,430,727,000
|
Machinery
|
52,486,672,000
|
51,799,201,000
|
Vehicles [abstract]
|
|
|
Ships
|
0
|
0
|
Aircraft
|
561,612,000
|
563,987,000
|
Motor vehicles
|
803,510,000
|
866,327,000
|
Total vehicles
|
1,365,122,000
|
1,430,314,000
|
Fixtures and fittings
|
421,476,000
|
405,278,000
|
Office equipment
|
1,985,115,000
|
1,974,221,000
|
Tangible exploration and evaluation assets
|
0
|
0
|
Mining assets
|
0
|
0
|
Oil and gas assets
|
0
|
0
|
Construction in progress
|
11,694,519,000
|
9,938,991,000
|
Construction prepayments
|
0
|
0
|
Other property, plant and equipment
|
1,062,846,000
|
1,110,545,000
|
Total property, plant and equipment
|
78,390,280,000
|
76,089,277,000
|
Investment property [abstract]
|
|
|
Investment property completed
|
0
|
0
|
Investment property under construction or development
|
0
|
0
|
Investment property prepayments
|
0
|
0
|
Total investment property
|
0
|
0
|
Intangible assets and goodwill [abstract]
|
|
|
Intangible assets other than goodwill [abstract]
|
|
|
Brand names
|
2,404,660,000
|
2,522,959,000
|
Intangible exploration and evaluation assets
|
0
|
0
|
Mastheads and publishing titles
|
0
|
0
|
Computer software
|
1,844,922,000
|
1,877,769,000
|
Licences and franchises
|
0
|
0
|
Copyrights, patents and other industrial property rights, service and operating rights
|
0
|
0
|
Recipes, formulae, models, designs and prototypes
|
0
|
0
|
Intangible assets under development
|
0
|
0
|
Other intangible assets
|
19,388,392,000
|
19,592,971,000
|
Total intangible assets other than goodwill
|
23,637,974,000
|
23,993,699,000
|
Goodwill
|
14,112,626,000
|
14,112,626,000
|
Total intangible assets and goodwill
|
37,750,600,000
|
38,106,325,000
|
Trade and other current payables [abstract]
|
|
|
Current trade payables
|
22,826,139,000
|
17,361,484,000
|
Concept
|
Close Current Quarter
2016-03-31
|
Close Previous Exercise
2015-12-31
|
Current payables to related parties
|
554,619,000
|
443,035,000
|
Accruals and deferred income classified as current [abstract]
|
|
|
Deferred income classified as current
|
18,602,286,000
|
20,470,380,000
|
Rent deferred income classified as current
|
0
|
0
|
Accruals classified as current
|
826,809,000
|
1,318,739,000
|
Short-term employee benefits accruals
|
755,067,000
|
1,034,446,000
|
Total accruals and deferred income classified as current
|
19,429,095,000
|
21,789,119,000
|
Current payables on social security and taxes other than income tax
|
500,439,000
|
628,544,000
|
Current value added tax payables
|
54,417,000
|
61,254,000
|
Current retention payables
|
579,974,000
|
617,496,000
|
Other current payables
|
0
|
0
|
Total trade and other current payables
|
43,890,266,000
|
40,839,678,000
|
Other current financial liabilities [abstract]
|
|
|
Bank loans current
|
74,234,000
|
2,979,847,000
|
Stock market loans current
|
0
|
0
|
Other current iabilities at cost
|
523,062,000
|
511,556,000
|
Other current liabilities no cost
|
0
|
0
|
Other current financial liabilities
|
1,787,621,000
|
1,185,623,000
|
Total Other current financial liabilities
|
2,384,917,000
|
4,677,026,000
|
Trade and other non-current payables [abstract]
|
|
|
Non-current trade payables
|
3,120,839,000
|
2,711,224,000
|
Non-current payables to related parties
|
0
|
0
|
Accruals and deferred income classified as non-current [abstract]
|
|
|
Deferred income classified as non-current
|
290,031,000
|
514,531,000
|
Rent deferred income classified as non-current
|
0
|
0
|
Accruals classified as non-current
|
0
|
0
|
Total accruals and deferred income classified as non-current
|
290,031,000
|
514,531,000
|
Non-current payables on social security and taxes other than income tax
|
0
|
0
|
Non-current value added tax payables
|
0
|
0
|
Non-current retention payables
|
0
|
0
|
Other non-current payables
|
0
|
0
|
Total trade and other non-current payables
|
3,410,870,000
|
3,225,755,000
|
Other non-current financial liabilities [abstract]
|
|
|
Bank loans non-current
|
9,608,814,000
|
4,501,843,000
|
Stock market loans non-current
|
103,199,322,000
|
102,928,921,000
|
Other non-current liabilities at cost
|
8,725,443,000
|
5,293,559,000
|
Other non-current liabilities no cost
|
0
|
0
|
Other non-current financial liabilities
|
260,683,000
|
225,660,000
|
Total Other non-current financial liabilities
|
121,794,262,000
|
112,949,983,000
|
Other provisions [abstract]
|
|
|
Other non-current provisions
|
52,917,000
|
52,884,000
|
Other current provisions
|
2,714,582,000
|
1,828,551,000
|
Total other provisions
|
2,767,499,000
|
1,881,435,000
|
Other reserves [abstract]
|
|
|
Revaluation surplus
|
0
|
0
|
Reserve of exchange differences on translation
|
1,105,009,000
|
972,154,000
|
Reserve of cash flow hedges
|
-175,858,000
|
-153,264,000
|
Reserve of gains and losses on hedging instruments that hedge investments in equity instruments
|
0
|
0
|
Reserve of change in value of time value of options
|
0
|
0
|
Reserve of change in value of forward elements of forward contracts
|
0
|
0
|
Reserve of change in value of foreign currency basis spreads
|
0
|
0
|
Reserve of gains and losses on remeasuring available-for-sale financial assets
|
4,226,070,000
|
4,254,280,000
|
Concept
|
Close Current Quarter
2016-03-31
|
Close Previous Exercise
2015-12-31
|
Reserve of share-based payments
|
0
|
0
|
Reserve of remeasurements of defined benefit plans
|
-126,845,000
|
-126,845,000
|
Amount recognised in other comprehensive income and accumulated in equity relating to non-current assets or disposal groups held for sale
|
0
|
0
|
Reserve of gains and losses from investments in equity instruments
|
0
|
0
|
Reserve of change in fair value of financial liability attributable to change in credit risk of liability
|
0
|
0
|
Reserve for catastrophe
|
0
|
0
|
Reserve for equalisation
|
0
|
0
|
Reserve of discretionary participation features
|
0
|
0
|
Reserve of equity component of convertible instruments
|
0
|
0
|
Capital redemption reserve
|
0
|
0
|
Merger reserve
|
0
|
0
|
Statutory reserve
|
0
|
0
|
Other comprehensive income
|
319,959,000
|
311,229,000
|
Total other reserves
|
5,348,335,000
|
5,257,554,000
|
Net assets (liabilities) [abstract]
|
|
|
Assets
|
287,121,405,000
|
281,473,754,000
|
Liabilities
|
191,389,015,000
|
181,951,977,000
|
Net assets (liabilities)
|
95,732,390,000
|
99,521,777,000
|
Net current assets (liabilities) [abstract]
|
|
|
Current assets
|
92,016,783,000
|
89,938,076,000
|
Current liabilities
|
50,482,172,000
|
48,978,050,000
|
Net current assets (liabilities)
|
41,534,611,000
|
40,960,026,000
|
[800200] Notes - Analysis of income and expense
Concept
|
Accumulated Current Year
2016-01-01 - 2016-03-31
|
Accumulated Previous Year
2015-01-01 - 2015-03-31
|
Analysis of income and expense [abstract]
|
|
|
Revenue [abstract]
|
|
|
Revenue from rendering of services
|
16,227,576,000
|
15,115,889,000
|
Revenue from sale of goods
|
532,967,000
|
549,788,000
|
Interest income
|
0
|
0
|
Royalty income
|
1,892,507,000
|
1,485,726,000
|
Dividend income
|
0
|
0
|
Rental income
|
3,087,929,000
|
2,707,960,000
|
Revenue from construction contracts
|
0
|
0
|
Other revenue
|
0
|
0
|
Total revenue
|
21,740,979,000
|
19,859,363,000
|
Finance income [abstract]
|
|
|
Interest income
|
308,129,000
|
315,508,000
|
Net gain on foreign exchange
|
0
|
0
|
Gains on change in fair value of derivatives
|
0
|
168,062,000
|
Gain on change in fair value of financial instruments
|
0
|
0
|
Other finance income
|
0
|
0
|
Total finance income
|
308,129,000
|
483,570,000
|
Finance costs [abstract]
|
|
|
Interest expense
|
1,983,300,000
|
1,477,706,000
|
Net loss on foreign exchange
|
230,448,000
|
866,873,000
|
Losses on change in fair value of derivatives
|
102,940,000
|
0
|
Loss on change in fair value of financial instruments
|
0
|
0
|
Other finance cost
|
0
|
0
|
Total finance costs
|
2,316,688,000
|
2,344,579,000
|
Tax income (expense)
|
|
|
Current tax
|
1,922,611,000
|
1,465,117,000
|
Deferred tax
|
-1,417,101,000
|
-618,691,000
|
Total tax income (expense)
|
505,510,000
|
846,426,000
|
[800500] Notes - List of notes
Disclosure of notes and other explanatory information
|
See Notes 1 and 2
Disclosure of general information about financial statements
|
This management commentary contains forward-looking statements regarding the Company’s results and prospects. Actual results could differ materially from these statements. The forward-looking statements in these management commentary releases should be read in conjunction with the factors described in “Item 3. Key Information – Forward-Looking Statements” in the Company’s Annual Report on Form 20-F, which, among others, could cause actual results to differ materially from those contained in forward-looking statements made in this press release and in oral statements made by authorized officers of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise
.
Disclosure of summary of significant accounting policies
|
See Note 2
[800600] Notes - List of accounting policies
Disclosure of summary of significant accounting policies
|
See Note 2
[813000] Notes - Interim financial reporting
Disclosure of interim financial reporting
|
GRUPO TELEVISA, S.A.B. AND SUBSIDIARIES
Notes to Unaudited Condensed Consolidated Financial Statements
For the three months ended March 31, 2016 and 2015
(In thousands of Mexican Pesos, except per CPO, per share, par value and exchange rate amounts)
Grupo Televisa, S.A.B. (the “Company”) is a limited liability public stock corporation (“Sociedad Anónima Bursátil” or “S.A.B.”), incorporated under the laws of Mexico. Pursuant to the terms of the Company’s bylaws (“Estatutos Sociales”) its corporate existence continues through 2106. The shares of the Company are listed and traded in the form of “Certificados de Participación Ordinarios” or “CPOs” on the Mexican Stock Exchange (“Bolsa Mexicana de Valores”) under the ticker symbol TLEVISA CPO, and in the form of Global Depositary Shares or GDSs, on the New York Stock Exchange, or NYSE, under the ticker symbol TV. The Company’s principal executive offices are located at Avenida Vasco de Quiroga 2000, Colonia Santa Fe, 01210 Ciudad de México.
Grupo Televisa, S.A.B. together with its subsidiaries (collectively, the “Group”) is a leading media company in the Spanish-speaking world, an important cable operator in Mexico, and a leading direct-to-home satellite pay television system in Mexico. The Group distributes the content it produces through several broadcast channels in Mexico and in over 50 countries, through 26 pay-TV brands, and television networks, cable operators and over the top or “OTT” services. In the United States, the Group’s audiovisual content is distributed through Univision Communications Inc. (“Univision”), the leading media company serving the Hispanic market. Univision broadcasts the Group’s audiovisual content through multiple platforms, in exchange the Group receives a royalty payment. In addition, the Group has equity and Warrants which upon their exercise and subject to any necessary approval from the Federal Communications Commission of the United States would represent approximately 36% on a fully-diluted, as-converted basis of the equity capital in Univision Holdings, Inc. or “UHI” (formerly, Broadcasting Media Partners, Inc.), the controlling company of Univision. The Group cable business offers integrated services, including video, high-speed data and voice services to residential and commercial customers as well as managed services to domestic and international carriers through five cable multiple system operators in Mexico. The Group’s owns a majority interest in Sky, the leading direct-to-home satellite pay television system in Mexico, operating also in the Dominican Republic and Central America. The Group also has interests in magazine publishing and distribution, radio production and broadcasting, professional sports and live entertainment, feature-film production and distribution, and gaming.
2.
|
Basis of Preparation and
Accounting Policies
|
These condensed consolidated financial statements of the Group, as of March 31, 2016 and December 31, 2015, and for the three months ended March 31, 2016 and 2015, are unaudited, and have been prepared in accordance with the guidelines provided by the International Accounting Standard 34,
Interim Financial Reporting
. In the opinion of management, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included herein.
These unaudited condensed consolidated financial statements should be read in conjunction with the Group’s audited consolidated financial statements and notes thereto for the years ended December 31, 2014 and 2013, which have been prepared in accordance with International Financial Reporting Standards (“IFRSs”) as issued by the International Accounting Standards Board, and include, among other disclosures, the Group’s most significant accounting policies, which were applied on a consistent basis as of March 31, 2016.
These interim unaudited condensed consolidated financial statements were authorized for issuance on April 20, 2016, by the Group’s Chief Financial Officer.
The preparation of interim consolidated financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these unaudited condensed interim financial statements, the significant judgments made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended December 31, 2014, with the exception of the change in the useful life of trademarks as mentioned in Note 7, the derecognition of Convertible Debentures issued by UHI, the classification of Warrants exercisable for common stock of UHI as available-for-sale financial assets, and the designated fair value hedge of foreign exchange exposure related to the UHI Warrants, as mentioned in Notes 4 and 9.
3.
|
Acquisitions, Investments and Disposition
|
In January 2015, the Group acquired, through a series of transactions, all of the equity interest of Cablevisión Red, S.A. de C.V. and other related companies (collectively, “Telecable”) for an aggregate cash consideration of Ps.10,001,838. Telecable is a cable business that provides video, data and telephone services primarily in the states of Guanajuato, Jalisco, Aguascalientes, Querétaro, Tamaulipas and Colima. The Group began to consolidate the net assets and results of operations of Telecable beginning in the first quarter of 2015. The Group completed a final purchase price allocation for this transaction in the fourth quarter of 2015. Through the acquisition of Telecable, the Group continues with its strategy to establish a cable company with national coverage that delivers more and better services through state of the art technology and internationally competitive prices for the benefit of end users. The following table summarizes the allocation of the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed at the acquisition date. The excess of the purchase price over those fair values and the related deferred income tax liability was allocated to goodwill in the Cable segment.
|
|
|
|
|
|
Acquisition in January
2015
|
|
Cash and cash equivalents
|
|
Ps.
|
270,447
|
|
Trade and other receivables
|
|
|
57,687
|
|
Other current assets
|
|
|
34,118
|
|
Total current assets
|
|
|
362,252
|
|
Property, plant and equipment, net
Goodwill
Concessions
List of subscribers
Trademarks
Other intangible assets
|
|
|
1,724,757
4,885,331
4,373,855
1,233,808
218,578
16,240
|
|
Other non-current assets
|
|
|
4,582
|
|
Total assets
|
|
|
12,819,403
|
|
Trade and other payables
|
|
|
135,920
|
|
Other current liabilities
|
|
|
78,753
|
|
Total current liabilities
|
|
|
214,673
|
|
Long-term debt
|
|
|
505,425
|
|
Deferred income tax liability
|
|
|
2,090,269
|
|
Other non-current liabilities
|
|
|
7,198
|
|
Total non-current liabilities
|
|
|
2,602,892
|
|
Total liabilities
|
|
|
2,817,565
|
|
Total net assets
|
|
Ps.
|
10,001,838
|
|
In January 2015, the Group received proceeds in the aggregate amount of U.S.$717 million (Ps.10,632,393) in connection with the disposal in 2014 of its investment in GSF Telecom Holdings, S.A.P.I. de C.V. (“GSF”), of which U.S.$697 million were in cash and U.S.$20 million were held in escrow for certain contingent litigation costs. As of December 31, 2015, the amount held in escrow was of U.S.$11.9 million (Ps.204,954).
In July 2015, UHI, the controlling company of Univision, and the Company announced that together with major shareholders of UHI, they had entered into a Memorandum of Understanding (“MOU”) and that certain subsidiaries of UHI and the Company entered into an agreement to amend their existing Program Licensing Agreement (the “PLA”). Under the PLA amendment, the terms of the existing strategic relationship between UHI and the Group have been amended among other things, (i) to extend the term of the PLA from its current expiration date of at least 2025 to at least 2030 upon consummation of a qualified public equity offering of UHI; and (ii) to adjust the royalty computation of the PLA by making certain additional revenue subject to royalties in exchange for certain adjustments to the royalty rate. Under the terms of the MOU, UHI, the Group and the major shareholders of UHI agreed to (i) upon a qualifying initial public offering of UHI, an equity capitalization of UHI by which, among other considerations, the Group will hold common stock with approximately 22% of the voting rights of UHI common stock, and the right for the Group to designate a minimum number of directors to UHI’s Board of Directors; and (ii) the exchange of U.S.$1,125 million (Ps.17,634,375) principal amount of Convertible Debentures issued by UHI for Warrants that are exercisable for UHI’s common stock, and a cash payment by UHI in the amount of U.S.$135.1 million (Ps.2,194,981) for such exchange. In July 2015, the Group exercised a portion of these Warrants to increase its equity stake in UHI from 7.8% to 10% (see Notes 4, 5 and 9).
In July 2015, the Company acquired additional shares of Imagina Media Audiovisual, S.L. (together with its subsidiaries, “Imagina”) in the aggregate cash amount of €19.2 million (Ps.341,710) in connection with a reorganization of stockholders of this investee, by which the Company increased its equity stake in Imagina from 14.5% to 19.9% (see Notes 4 and 5)
In March 2016, the Group announced the acquisition of the remaining 50% equity interest of Televisión Internacional, S.A. de C.V. (“TVI”) in the aggregate amount of Ps.6,750,000, including the assumption of long-term liabilities in the aggregate amount of Ps.4,750,000 with maturities between 2017 and 2020, and a cash payment of Ps.2,000,000. Until such acquisition is completed in the second half of 2016, a non-controlling interest will participate as a shareholder of Corporativo Vasco de Quiroga, S.A. de C.V. (“CVQ”), a direct subsidiary of the Company. This transaction also provides for the acquisition of the non-controlling interest in CVQ in the amount of Ps.1,258,000, which is included in the total amount of the transaction. This transaction complies with the guidelines and timetable established in the authorization by the IFT. With the ownership of the 100% of the equity interest of TVI, the Group will be better positioned to exploit efficiencies and economies of scale among all its cable operations throughout Mexico and continue expanding its offer of video, voice and data services. The effect of this transaction in the equity attributable to stockholders of the Company as of March 31, 2016, was as follows:
|
|
Acquisition of a
Non-controlling
Interest
|
|
Carrying value of the non-controlling interest in TVI
|
|
Ps.
|
768,703
|
|
Consideration for the 50% equity interest of TVI
|
|
|
(5,492,000
|
)
|
Decrease in retained earnings attributable to stockholders of the Company
|
|
Ps.
|
(4,723,297
|
)
|
4. Investments in Financial Instruments
At March 31, 2016 and December 31, 2015, the Group had the following investments in financial instruments:
|
|
March
31, 2016
|
|
|
December 31, 2015
|
|
Available-for-sale financial assets:
|
|
|
|
|
|
|
Warrants issued by UHI
(1)
|
|
Ps.
|
34,974,065
|
|
|
Ps.
|
35,042,577
|
|
Available-for-sale investments
(2)
|
|
|
6,032,661
|
|
|
|
5,873,243
|
|
|
|
|
41,006,726
|
|
|
|
40,915,820
|
|
Held-to-maturity investments
(3)
|
|
|
245,575
|
|
|
|
134,034
|
|
Other
|
|
|
31,621
|
|
|
|
31,620
|
|
|
|
Ps.
|
41,283,922
|
|
|
Ps.
|
41,081,474
|
|
(1)
Through July 2015, the Group held an investment in Convertible Debentures due 2025 issued by UHI in the principal amount of U.S.$1,125 million (Ps.17,634,375), with an annual interest rate of 1.5% receivable on a quarterly basis, which were convertible at the Company’s option into additional shares equivalent to approximately 30% equity stake of UHI, subject to existing laws and regulations in the United States, and other conditions. These Convertible Debentures were classified as available-for-sale financial assets with changes in fair value recognized in other comprehensive income or loss in consolidated equity. The Group’s option of converting these debentures into an equity stake of UHI was accounted for as an embedded derivative with changes in fair value recognized in consolidated income. In July 2015, the Group exchanged its investment in these Convertible Debentures for an investment in Warrants that are exercisable for UHI’s common stock, subject to the U.S. Federal Communications Commission’s restrictions on foreign ownership, in whole or in part, at an exercise price of U.S.$0.01 per Warrant share, considering that the original value of U.S.$1,125 million invested by the Group in Convertible Debentures is part of the Group’s investment in Warrants. The Warrants shall expire and no longer be exercisable after the tenth anniversary of the date of issuance (the “Expiration Date”); provided, however, the Expiration Date shall automatically be extended for nine successive ten-year periods unless the Group provides written notice to UHI of its election not to so extend the Expiration Date. The Warrants do not bear interest. The fair value of these Warrants at the date of exchange was U.S.$1,951 million (Ps.30,582,427). The Group reclassified Ps.4,718,175 from accumulated other comprehensive income in consolidated equity to other finance income in the consolidated statement of income for the year ended December 31, 2015, as a result of derecognizing the Convertible Debentures. In July 2015, the Group exercised a portion of these Warrants in the amount of U.S$107.4 million (Ps.1,695,524) to increase its equity stake in UHI from 7.8% to 10%. These Warrants are classified as available-for-sale financial assets with changes in fair value recognized in accumulated other comprehensive income or loss in consolidated equity. Changes in fair value recognized in other comprehensive income will be reclassified to the statement of income within other finance income, net, in the period the Warrants are exercised, in whole or in part (see Notes 3 and 5).
(2)
The Group has an investment in an open ended fund that has as a primary objective to achieve capital appreciation by using a broad range of strategies through investments and transactions in telecom, media and other sectors across global markets, including Latin America and other emerging markets. Shares may be redeemed on a quarterly basis at the Net Asset Value (“NAV”) per share as of such redemption date. The fair value of this fund is determined by using the NAV per share. The NAV per share is calculated by determining the value of the fund assets and subtracting all of the fund liabilities and dividing the result by the total number of issued shares.
(3)
Held-to-maturity investments represent corporate fixed income securities with long-term maturities. These investments are stated at amortized cost. Maturities of these investments subsequent to March 31, 2016, are as follows: Ps.200,410 in 2017, Ps.13,365 in 2018 and Ps.31,800 thereafter. Held-to-maturity financial assets as of March 31, 2016 and December 31, 2015 are denominated primarily in Mexican pesos.
A roll forward of available-for-sale financial assets for the three months ended March 31, 2016 is presented as follows:
At January 1, 2016
|
|
Ps.
|
40,915,820
|
|
Changes in fair value in other comprehensive income
|
|
|
(39,363
|
)
|
Foreign exchange differences
|
|
|
130,269
|
|
At March 31, 2016
|
|
Ps.
|
41,006,726
|
|
The maximum exposure to credit risk of the investments in financial instruments as of March 31, 2016 is the carrying value of the financial assets mentioned above.
5.
|
Investments in Associates and Joint Ventures
|
At March 31, 2016 and December 31, 2015, the Group had the following investments in associates and joint ventures accounted for by the equity method:
|
|
Ownership as of
|
|
|
|
March 31, 2016
|
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
Associates:
|
|
|
|
|
|
|
|
|
|
UHI
(1)
|
|
|
10.0
|
%
|
|
Ps.
|
5,840,983
|
|
|
Ps.
|
5,685,748
|
|
Imagina
(2)
|
|
|
19.9
|
%
|
|
|
2,073,870
|
|
|
|
1,921,590
|
|
Ocesa Entretenimiento, S.A. de C.V. and subsidiaries (collectively, “OCEN”)
(3)
|
|
|
40.0
|
%
|
|
|
966,028
|
|
|
|
938,995
|
|
Other
|
|
|
|
|
|
|
93,490
|
|
|
|
83,220
|
|
Joint ventures:
|
|
|
|
|
|
|
|
|
|
|
|
|
Grupo de Telecomunicaciones de Alta Capacidad, S.A.P.I. de C.V. (“GTAC”)
(4)
|
|
|
33.3
|
%
|
|
|
581,899
|
|
|
|
574,480
|
|
Televisa CJ Grand, S.A. de C.V.
|
|
|
50.0
|
%
|
|
|
57,769
|
|
|
|
67,868
|
|
|
|
|
|
|
|
Ps.
|
9,614,039
|
|
|
Ps.
|
9,271,901
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The Group accounts for its investment in common stock of UHI, the parent company of Univision, under the equity method due to the Group’s ability to exercise significant influence, as defined under IFRS, over UHI’s operations. The Group has the ability to exercise significant influence over the operating and financial policies of UHI because the Group (i) as of March 31, 2016 and December 31, 2015, owned 1,110,382 Class C shares of common stock of UHI, representing 10% , of the outstanding total shares of UHI as of the date; (ii) held Warrants exercisable for common stock of UHI equivalent to approximately 26% equity stake of UHI on a fully-diluted, as-converted basis, subject to certain conditions, laws and regulations; (iii) had three officers and one director of the Company designated as members of the Board of Directors of UHI, which was composed of 18 directors, of 22 available board seats; and (iv) was party to a program license agreement, as amended, with Univision, an indirect wholly-owned subsidiary of UHI, pursuant to which Univision has the right to broadcast certain Televisa content in the United States (“Program License Agreement”), and to another program license agreement pursuant to which the Group has the right to broadcast certain Univision’s content in Mexico (“Mexican License Agreement”), in each case through the later of 2025 (2030 upon consummation of a qualified public equity offering of UHI) or 90 months after the Group has sold two-thirds of its initial investment in UHI made in December 2010.
|
(2)
|
Through June 2015, the Company’s investment in common stock of Imagina was accounted for as an available-for-sale equity financial asset with changes in fair value recognized in consolidated other comprehensive income or loss. In July 2015, the Company acquired additional shares of Imagina and increased its equity stake in Imagina from 14.5% to 19.9%. As a result of this transaction, beginning in the third quarter of 2015 the Group (i) holds two of 10 seats on the Board of Directors of Imagina; (ii) began to account for this investment under the equity method due to its ability to exercise significant influence over the operating and financial policies of Imagina; (iii) recognized its investment in Imagina as an associate through the fair value as deemed cost at the transaction date; and (iv) reclassified a cumulative gain of Ps.544,402, related to changes in fair value of the investment in Imagina from accumulated other comprehensive income in consolidated equity to consolidated other finance income for the year ended December 31, 2015 (see Notes 3).
|
(3)
|
OCEN is a majority-owned subsidiary of Corporación Interamericana de Entretenimiento, S.A.B. de C.V., and is engaged in the live entertainment business in Mexico. The investment in OCEN includes a goodwill of Ps.359,613 as of March 31, 2016 and December 31, 2015.
|
(4)
|
In June 2010, a subsidiary of the Company entered into a long-term credit facility agreement to provide financing to GTAC for up to Ps.688,217, with an annual interest rate of the Mexican Interbank Interest Rate (“Tasa de Interés Interbancaria de Equilibrio” or “TIIE”) plus 200 basis points. Under the terms of this agreement, principal and interest are payable at dates agreed by the parties, between 2013 and 2021. As of December 31, 2015, GTAC had used a principal amount of Ps.661,183, under this credit facility.
Also, a subsidiary of the Company entered into supplementary long-term loans to provide additional financing to GTAC for an aggregate principal amount of Ps.246,019, with an annual interest of TIIE plus 200 basis points payable on a monthly basis and principal maturities through 2023, 2024 and 2025. The net investment in GTAC as of March 31, 2016 and December 31, 2015, included amounts receivable in connection with this long-term credit facility and supplementary loans to GTAC in the aggregate amount of Ps.695,439 and Ps.684,259, respectively.
|
6.
|
Property, Plant and Equipment, Net
|
Property, plant and equipment as of March 31, 2016 and December 31, 2015, consisted of:
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
Buildings
|
|
Ps.
|
8,643,583
|
|
|
Ps.
|
8,635,843
|
|
Building improvements
|
|
|
275,776
|
|
|
|
287,732
|
|
Technical equipment
|
|
|
100,782,274
|
|
|
|
97,721,490
|
|
Satellite transponders
|
|
|
10,301,713
|
|
|
|
10,301,713
|
|
Furniture and fixtures
|
|
|
998,400
|
|
|
|
966,928
|
|
Transportation equipment
|
|
|
2,623,221
|
|
|
|
2,631,076
|
|
Computer equipment
|
|
|
6,859,160
|
|
|
|
6
,642,536
|
|
Leasehold improvements
|
|
|
2,216,546
|
|
|
|
2,170,607
|
|
|
|
|
132,700,673
|
|
|
|
129,357,925
|
|
Accumulated depreciation
|
|
|
(70,705,721
|
)
|
|
|
(67,907,362
|
)
|
|
|
|
61,994,952
|
|
|
|
61,450,563
|
|
Land
|
|
|
4,700,809
|
|
|
|
4,699,723
|
|
Construction and projects in progress
|
|
|
11,694,519
|
|
|
|
9,938,991
|
|
|
|
Ps.
|
78,390,280
|
|
|
Ps.
|
76,089,277
|
|
Depreciation charged to income for the three months ended March 31, 2016 and 2015 was Ps.3,372,816 and Ps.2,869,503, respectively.
During the three months ended March 31, 2016, the Group invested Ps.5,977,002 in property plant and equipment as capital expenditures.
7.
|
Intangible Assets, Net
|
The balances of intangible assets as of March 31, 2016 and December 31, 2015, were as follows:
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
|
|
Gross Carrying Amount
|
|
|
Gross Accumulated Amortization
|
|
|
Net Carrying Amount
|
|
|
Carrying Amount
|
|
|
Accumulated Amortization
|
|
|
Net Carrying Amount
|
|
Intangible assets with indefinite useful lives:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
|
|
|
|
|
Ps.
|
14,112,626
|
|
|
|
|
|
|
|
|
Ps.
|
14,112,626
|
|
Trademarks
|
|
|
|
|
|
|
|
|
782,865
|
|
|
|
|
|
|
|
|
|
782,958
|
|
Concessions
|
|
|
|
|
|
|
|
|
15,719,572
|
|
|
|
|
|
|
|
|
|
15,719,572
|
|
Intangible assets with finite useful lives:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trademarks
|
|
Ps.
|
1,891,306
|
|
|
Ps.
|
(269,511
|
)
|
|
|
1,621,795
|
|
|
Ps.
|
1,891,306
|
|
|
Ps.
|
(151,305
|
)
|
|
|
1,740,001
|
|
Licenses and software
|
|
|
5,514,905
|
|
|
|
(3,669,983
|
)
|
|
|
1,844,922
|
|
|
|
5,366,912
|
|
|
|
(3,489,143
|
)
|
|
|
1,877,769
|
|
Subscriber lists
|
|
|
6,207,405
|
|
|
|
(3,780,023
|
)
|
|
|
2,427,382
|
|
|
|
6,207,405
|
|
|
|
(3,520,650
|
)
|
|
|
2,686,755
|
|
Other intangible assets
|
|
|
3,196,005
|
|
|
|
(1,954,567
|
)
|
|
|
1,241,438
|
|
|
|
3,014,421
|
|
|
|
(1,827,777
|
)
|
|
|
1,186,644
|
|
|
|
Ps.
|
16,809,621
|
|
|
Ps.
|
(9,674,084
|
)
|
|
Ps.
|
37,750,600
|
|
|
Ps.
|
16,480,044
|
|
|
Ps.
|
(8,988,875
|
)
|
|
Ps.
|
38,106,325
|
|
Amortization charged to income for the three months ended March 31, 2016 and 2015 was Ps.637,064 and Ps.473,634, respectively.
In the third quarter of 2015, the Company’s management evaluated trademarks in its Cable segment to determine whether events and circumstances continue to support an indefinite useful life for these intangible assets. As a result of such evaluation, the Company identified certain businesses and locations that began migrating from a current trademark to an internally developed trademark between 2015 and 2016, in connection with enhanced service packages offered to current and new subscribers, and estimated that this migration process will take approximately four years. Accordingly, beginning in the third quarter of 2015, the Group changed the useful life assessment from indefinite to finite for acquired trademarks in certain businesses and locations in its Cable segment, and began to amortize on a straight line basis the related carrying value of those trademarks when the migration to the new trademark started using an estimated useful life of four years. The Group has not capitalized any amounts associated with internally developed trademarks.
8.
|
Debt, Finance Lease Obligations and Other Finance Liabilities
|
Debt and finance lease obligations outstanding as of March 31, 2016 and December 31, 2015, were as follows:
|
|
|
|
|
|
|
|
|
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
|
|
Principal
|
|
|
Interest Payable
|
|
|
Finance Costs
|
|
|
Total
|
|
|
Total
|
|
U.S. dollar debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6% Senior Notes due 2018 (1)
|
|
Ps.
|
8,637,400
|
|
|
Ps.
|
190,023
|
|
|
Ps.
|
(14,546
|
)
|
|
Ps.
|
8,812,877
|
|
|
Ps.
|
8,652,032
|
|
6.625% Senior Notes due 2025 (1)
|
|
|
10,364,880
|
|
|
|
22,889
|
|
|
|
(344,785
|
)
|
|
|
10,042,984
|
|
|
|
10,169,133
|
|
4.625% Senior Notes due 2026 (1)
|
|
|
5,182,440
|
|
|
|
83,891
|
|
|
|
(48,020
|
)
|
|
|
5,218,311
|
|
|
|
5,077,309
|
|
8.50% Senior Notes due 2032 (1)
|
|
|
5,182,440
|
|
|
|
24,473
|
|
|
|
(28,259
|
)
|
|
|
5,178,654
|
|
|
|
5,270,241
|
|
6.625% Senior Notes due 2040 (1)
|
|
|
10,364,880
|
|
|
|
144,964
|
|
|
|
(150,738
|
)
|
|
|
10,359,106
|
|
|
|
10,492,825
|
|
5% Senior Notes due 2045 (1)
|
|
|
17,274,800
|
|
|
|
340,697
|
|
|
|
(493,306
|
)
|
|
|
17,122,191
|
|
|
|
16,842,804
|
|
6.125% Senior Notes due 2046 (1)
|
|
|
15,547,320
|
|
|
|
333,296
|
|
|
|
(142,024
|
)
|
|
|
15,738,592
|
|
|
|
15,508,198
|
|
Total U.S. dollar debt
|
|
|
72,554,160
|
|
|
|
1,140,233
|
|
|
|
(1,221,678
|
)
|
|
|
72,472,715
|
|
|
|
72,012,542
|
|
Mexican peso debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7.38% Notes due 2020 (2)
|
|
|
10,000,000
|
|
|
|
317,750
|
|
|
|
(32,327
|
)
|
|
|
10,285,423
|
|
|
|
10,099,160
|
|
TIIE + 0.35% Notes due 2021 (2)
|
|
|
6,000,000
|
|
|
|
15,345
|
|
|
|
(10,517
|
)
|
|
|
6,004,828
|
|
|
|
5,997,623
|
|
TIIE + 0.35% Notes due 2022 (2)
|
|
|
5,000,000
|
|
|
|
10,413
|
|
|
|
(10,628
|
)
|
|
|
4,999,785
|
|
|
|
4,994,189
|
|
8.49% Senior Notes due 2037 (1)
|
|
|
4,500,000
|
|
|
|
128,411
|
|
|
|
(15,347
|
)
|
|
|
4,613,064
|
|
|
|
4,517,371
|
|
7.25% Senior Notes due 2043 (1)
|
|
|
6,500,000
|
|
|
|
172,792
|
|
|
|
(64,341
|
)
|
|
|
6,608,451
|
|
|
|
6,490,046
|
|
Bank loans
|
|
|
1,250,000
|
|
|
|
181
|
|
|
|
(964
|
)
|
|
|
1,249,217
|
|
|
|
4,778,905
|
|
Bank loans (Sky)
|
|
|
5,500,000
|
|
|
|
–
|
|
|
|
–
|
|
|
|
5,500,000
|
|
|
|
-
|
|
Bank loans (TVI)
|
|
|
2,940,637
|
|
|
|
2,496
|
|
|
|
(6,625
|
)
|
|
|
2,936,508
|
|
|
|
2,704,996
|
|
Total Mexican peso debt
|
|
|
41,690,637
|
|
|
|
647,388
|
|
|
|
(140,749
|
)
|
|
|
42,197,276
|
|
|
|
39,582,290
|
|
Total debt (3)
|
|
|
114,244,797
|
|
|
|
1,787,621
|
|
|
|
(1,362,427
|
)
|
|
|
114,669,991
|
|
|
|
111,594,832
|
|
Less: Current portion of long- term debt
|
|
|
74,750
|
|
|
|
1,787,621
|
|
|
|
(516
|
)
|
|
|
1,861,855
|
|
|
|
4,164,068
|
|
Long-term debt, net of current portion
|
|
Ps.
|
114,170,047
|
|
|
Ps.
|
–
|
|
|
Ps.
|
(1,361,911
|
)
|
|
Ps.
|
112,808,136
|
|
|
Ps.
|
107,430,764
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Satellite transponder lease obligation
|
|
Ps.
|
4,830,094
|
|
|
Ps.
|
–
|
|
|
Ps.
|
–
|
|
|
Ps.
|
4,830,094
|
|
|
Ps.
|
4,879,940
|
|
Other
|
|
|
917,681
|
|
|
|
–
|
|
|
|
–
|
|
|
|
917,681
|
|
|
|
925,175
|
|
Total finance lease obligations
|
|
|
5,747,775
|
|
|
|
--
|
|
|
|
–
|
|
|
|
5,747,775
|
|
|
|
5,805,115
|
|
Less: Current portion
|
|
|
523,062
|
|
|
|
–
|
|
|
|
–
|
|
|
|
523,062
|
|
|
|
511,556
|
|
Finance lease obligations, net of current portion
|
|
Ps.
|
5,224,713
|
|
|
Ps.
|
–
|
|
|
Ps.
|
–
|
|
|
Ps.
|
5,224,713
|
|
|
Ps.
|
5,293,559
|
|
(1)
|
These Senior Notes are unsecured obligations of the Company, rank equally in right of payment with all existing and future unsecured and unsubordinated indebtedness of the Company, and are junior in right of payment to all of the existing and future liabilities of the Company’s subsidiaries. Interest on the Senior Notes due 2018, 2025, 2026, 2032, 2037, 2040, 2043, 2045 and 2046, including additional amounts payable in respect of certain Mexican withholding taxes, is 6.31%, 6.97%, 4.86%, 8.94%, 8.93%, 6.97%, 7.62%, 5.26% and 6.44% per annum, respectively, and is payable semi-annually. These Senior Notes may not be redeemed prior to maturity, except (i) in the event of certain changes in law affecting the Mexican withholding tax treatment of certain payments on the securities, in which case the securities will be redeemable, as a whole but not in part, at the option of the Company; and (ii) in the event of a change of control, in which case the company may be required to redeem the securities at 101% of their principal amount. Also, the Company may, at its own option, redeem the Senior Notes due 2018, 2025, 2026, 2037, 2040, 2043 and 2046, in whole or in part, at any time at a redemption price equal to the greater of the principal amount of these Senior Notes or the present value of future cash flows, at the redemption date, of principal and interest amounts of the Senior Notes discounted at a fixed rate of comparable U.S. or Mexican sovereign bonds. The agreement of these Senior Notes contains covenants that limit the ability of the Company and certain restricted subsidiaries engaged in the Group’s content segment, to incur or assume liens, perform sale and leaseback transactions, and consummate certain mergers, consolidations and similar transactions. The Senior Notes due 2018, 2025, 2026, 2032, 2037, 2040, 2045 and 2046 are registered with the U.S. Securities and Exchange Commission (“SEC”). The Senior Notes due 2043 are registered with both the U.S. SEC and the Mexican Banking and Securities Commission (“Comisión Nacional Bancaria y de Valores” or “CNBV”).
|
(2)
|
Interest on these Notes (“Certificados Bursátiles”) is payable semi-annually for Notes due 2020 and every 28 days for Notes due 2021 and 2022. The Company may, at its own option, redeem the Notes due 2020, in whole or in part, at any semi-annual interest payment date at a redemption price equal to the greater of the principal amount of the outstanding notes and the present value of future cash flows, at the redemption date, of principal and interest amounts of the Notes discounted at a fixed rate of comparable Mexican sovereign bonds. The company may, at its own option, redeem the Notes due 2021 and 2022, in whole or in part, at any date at a redemption price equal to the greater of the principal amount of the outstanding notes and an average price calculated from prices to be provided at the redemption date by two Mexican financial pricing companies. The agreement of these Notes contains covenants that limit the ability of the Company and certain restricted subsidiaries appointed by the Company’s board of directors, and engaged in the Group’s content segment, to incur or assume liens, perform sale and leaseback transactions, and consummate certain mergers, consolidations and similar transactions.
|
(3)
|
Total debt is presented net of unamortized finance costs as of March 31, 2016 and December 31, 2015, in the aggregate amount of Ps.1,362,427 and Ps.1,387,876, respectively, and includes interest payable in the aggregate amount of Ps.1,787,621 and Ps.1,184,221 as of March 31 2016 and December 31, 2015, respectively.
|
In January 2015, the Group prepaid the principal amount and related accrued interest of a peso-denominated long-term bank loan previously entered into by Telecable, the telecommunications company acquired by the Group in January 2015, in the aggregate amount of Ps.507,362. This prepayment was funded primarily with cash provided by a long-term bank loan arranged by the Company with a Mexican bank in the principal amount of Ps.500,000, with a maturity in 2016, and annual interest of the 28-day interbank equilibrium interest rate (“Tasa de Interés Interbancaria de Equilibrio” or “TIIE”) plus a range between 0 and 80 basis points.
In May 2015, the Company concluded an offering of Ps.5,000,000 aggregate principal amount of local bonds (“Certificados Bursátiles”) due 2022 with an annual interest rate of the 28-day TIIE plus 35 basis points, which was registered with the CNBV.
During the year of 2015, TVI refinanced an outstanding long-term loan in the principal amount of Ps.722,020, with an original maturity in 2016, and incurred additional long-term debt in the aggregate principal amount of Ps.1,520,000. The refinanced and additional long-term debt of TVI matures in 2019 (Ps.250,000), 2020 (Ps.250,000) and 2022 (Ps.1,742,020) with an annual interest rate of the 28-day TIIE plus a range between 130 and 140 basis points, which is payable on a monthly basis.
In June 2015, the Company and Sky prepaid peso-denominated long-term bank loans in the aggregate principal amount of Ps.1,600,000 and Ps.3,500,000, respectively, with original principal maturities between 2016 and 2021. The aggregate amount paid by the Company and Sky amounted to Ps.1,814,312 and Ps.3,651,712, respectively, which included related accrued interest, the settlement of a related derivative contract, and fees. The prepayment of Sky was funded primarily by a long-term loan made by the Company in the principal amount of Ps.3,500,000, with a maturity in 2022, and an annual interest rate of 7.38%, which is payable on a monthly basis.
In November 2015, the Company issued U.S.$300 million aggregate principal amount of 4.625% Senior Notes due 2026 and U.S.$900 million aggregate principal amount of 6.125% Senior Notes due 2046 registered with the U.S. SEC.
In March 2016, Sky (i) entered into long-term debt agreements with two Mexican banks in the aggregate principal amount of Ps.5,500,000, with maturities between 2021 and 2023 and interest payable on a monthly basis at an annual rate in the range of 7.0% and 7.13%; and (ii) prepaid to the Company an outstanding amount in connection with a long-term loan in the principal amount of Ps.3,500,000. The Company used the funds received from Sky to prepay a portion of its Mexican peso outstanding long-term loans with original maturities between 2016 and 2017 in the aggregate principal amount of Ps.3,532,000. Total cash used for this prepayment amounted to Ps.3,568,838, which included the partial settlement of a related derivative contract and accrued interest.
The Group has designated as an effective hedge of foreign exchange exposure, a portion of the outstanding principal amount of its U.S. dollar denominated long-term debt in connection with its net investment in shares of common stock of UHI, which amounted to U.S.$338.1 million (Ps.5,840,984) and U.S.$330.5 million (Ps.5,685,748) as of March 31, 2016 and December 31, 2015, respectively. Consequently, any foreign exchange gain or loss attributable to this designated hedging long-term debt is credited or charged directly to other comprehensive income or loss as a cumulative result from foreign currency translation (see Note 5).
Beginning in the third quarter of 2015, the Group has designated a portion of its U.S. dollar denominated long-term debt as a fair value hedge of foreign exchange exposure related to its investment in UHI Warrants. A portion of the outstanding principal amount of its U.S. dollar denominated long-term debt (hedging instrument) is hedging its investment in Warrants exercisable for common stock of UHI (hedged item), which amounted to U.S.$2,024.6 million (Ps.34,974,065) and U.S.$2,035.5 million (Ps.35,042,577) as of March 31, 2016 and December 31, 2015, respectively. The other changes in fair value of the Warrants are recognized in other comprehensive income or loss. Consequently, any foreign currency gain or loss attributable to these designated hedged warrants is recognized within foreign exchange gain or loss in the consolidated statement of income, along with the recognition in the same line of any foreign gain or loss of the designated hedging instrument long-term debt (see Notes 4 and 9).
As of March 31, 2015, the Group is in compliance with all covenants contained in the debt agreements.
The table below analyzes the Group’s debt, finance lease obligations and other finance liabilities into relevant maturity groupings based on the remaining period at the statement of financial position date to the contracted maturity date:
|
|
Less than 12 months April 1, 2016 to March 31, 2017
|
|
|
12-36months April 1, 2017 to March 31, 2019
|
|
|
36-60 months April 1, 2019 to March 31, 2021
|
|
|
Maturities Subsequent to March 31,2021
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt (1)
|
|
Ps.
|
74,750
|
|
|
Ps.
|
10,495,621
|
|
|
Ps.
|
11,465,395
|
|
|
Ps.
|
92,209,031
|
|
|
Ps.
|
114,244,797
|
|
Finance lease liabilities
|
|
|
523,062
|
|
|
|
956,488
|
|
|
|
1,007,142
|
|
|
|
3,261,083
|
|
|
|
5,747,775
|
|
Other finance liabilities
|
|
|
-
|
|
|
|
2,313,230
|
|
|
|
1,187,500
|
|
|
|
-
|
|
|
|
3,500,730
|
|
Total debt, financial lease obligations and other finance liabilities
|
|
Ps.
|
597,812
|
|
|
Ps.
|
13,765,339
|
|
|
Ps.
|
13,660,037
|
|
|
Ps.
|
95,470,114
|
|
|
Ps.
|
123,493,302
|
|
(1)
|
The amounts of debt are disclosed on a principal amount basis.
|
9. Financial Instruments
The Group’s financial instruments presented in the condensed consolidated statements of financial position included cash and cash equivalents, temporary investments, accounts and notes receivable, a long-term loan receivable from GTAC, Warrants that are exercisable for UHI’s common stock, debt securities classified as held-to-maturity investments; investments in securities in the form of an open-ended fund classified as available-for-sale investments, accounts payable, debt, and derivative financial instruments. For cash and cash equivalents, temporary investments, accounts receivable, accounts payable, and short-term notes payable due to banks and other financial institutions the carrying amounts approximate fair value due to the short maturity of these instruments. The fair value of the Group’s long-term debt securities are based on quoted market prices.
The fair value of the long-term loans that the Group borrowed from leading Mexican banks (see Note 8) has been estimated using the borrowing rates currently available to the Group for bank loans with similar terms and average maturities. The fair value of held-to-maturity securities, available-for-sale investments, and currency option and interest rate swap agreements were determined by using valuation techniques that maximize the use of observable market data.
The carrying and estimated fair values of the Group’s non-derivative financial instruments as of March 31, 2016 and December 31, 2015, were as follows:
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
|
Carrying Value
|
|
|
Fair Value
|
|
|
Carrying Value
|
|
|
Fair Value
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary investments
|
|
Ps.
|
5,820,836
|
|
|
Ps.
|
5,820,836
|
|
|
Ps.
|
5,330,448
|
|
|
Ps.
|
5,330,448
|
Trade notes and accounts receivable, net
|
|
|
16,458,742
|
|
|
|
16,458,742
|
|
|
|
21,702,128
|
|
|
|
21,702,128
|
Warrants issued by UHI
|
|
|
34,974,065
|
|
|
|
34,974,065
|
|
|
|
35,042,577
|
|
|
|
35,042,577
|
Long-term loan and interest receivable from GTAC (see Note 5)
|
|
|
695,439
|
|
|
|
695,940
|
|
|
|
684,259
|
|
|
|
687,506
|
Held-to-maturity investments (see Note 4)
|
|
|
245,575
|
|
|
|
244,741
|
|
|
|
134,034
|
|
|
|
133,824
|
Available-for-sale investments (see Note 4)
|
|
|
6,032,661
|
|
|
|
6,032,661
|
|
|
|
5,873,243
|
|
|
|
5,873,243
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior Notes due 2018, 2025, 2032 and 2040
|
|
Ps.
|
34,549,600
|
|
|
Ps.
|
40,017,472
|
|
|
Ps.
|
34,432,000
|
|
|
Ps.
|
38,190,597
|
Senior Notes due 2045
|
|
|
17,274,800
|
|
|
|
15,885,388
|
|
|
|
17,216,000
|
|
|
|
14,860,851
|
Senior Notes due 2037 and 2043
|
|
|
11,000,000
|
|
|
|
9,852,830
|
|
|
|
11,000,000
|
|
|
|
9,620,550
|
Senior Notes due 2026 and 2046
|
|
|
20,729,760
|
|
|
|
21,991,322
|
|
|
|
20,659,200
|
|
|
|
20,650,007
|
Notes due 2020
|
|
|
10,000,000
|
|
|
|
10,467,120
|
|
|
|
10,000,000
|
|
|
|
10,437,500
|
Notes due 2021
|
|
|
6,000,000
|
|
|
|
5,997,246
|
|
|
|
6,000,000
|
|
|
|
5,996,640
|
Notes due 2022
|
|
|
5,000,000
|
|
|
|
4,959,680
|
|
|
|
5,000,000
|
|
|
|
4,957,300
|
Short-term loans and long-term notes payable to Mexican banks
|
|
|
9,690,637
|
|
|
|
9,855,951
|
|
|
|
7,491,287
|
|
|
|
7,561,955
|
Finance lease obligations
|
|
|
5,747,775
|
|
|
|
5,184,954
|
|
|
|
5,805,115
|
|
|
|
5,179,052
|
Other finance liabilities
|
|
|
3,500,730
|
|
|
|
3,700,746
|
|
|
|
-
|
|
|
|
-
|
The carrying values (based on estimated fair values), notional amounts, and maturity dates of the Group’s derivative financial instruments as of March 31, 2016 and December 31, 2015, were as follows:
March 31, 2016:
|
|
|
|
|
|
|
|
Derivative Financial Instruments
|
|
Carrying Value
|
|
|
Notional Amount
(U.S. Dollars in Thousands)
|
|
Maturity Date
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
Derivatives not recorded as accounting hedges:
|
|
|
|
|
|
|
|
TVI’s interest rate swap
|
|
Ps.
|
9,457
|
|
|
Ps.
|
1,425,417
|
|
April 2016 and May 2022
|
Derivatives recorded as accounting hedges (cash flow hedges):
|
|
|
|
|
|
|
|
|
|
Interest rate swap
|
|
|
60,791
|
|
|
Ps.
|
1,250,000
|
|
September 2017 through March 2018
|
Interest rate swap
|
|
|
177,340
|
|
|
Ps.
|
6,000,000
|
|
April 2021
|
Interest rate swap
|
|
|
13,095
|
|
|
Ps.
|
1,000,000
|
|
May 2022
|
Total liabilities
|
|
Ps.
|
260,683
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2015:
|
|
|
|
|
|
|
|
|
|
Derivative Financial Instruments
|
|
Carrying Value
|
|
|
Notional Amount
(U.S. Dollars in Thousands)
|
|
Maturity Date
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
Derivatives not recorded as accounting hedges:
|
|
|
|
|
|
|
|
|
|
TVI’s interest rate swap
|
|
Ps.
|
8,113
|
|
|
Ps.
|
1,985,847
|
|
February 2016 through May 2022
|
Derivatives recorded as accounting hedges (cash flow hedges):
|
|
|
|
|
|
|
|
|
|
Interest rate swap
|
|
|
116,108
|
|
|
Ps.
|
2,500,000
|
|
September 2016 through March 2018
|
Interest rate swap
|
|
|
99,567
|
|
|
Ps.
|
6,000,000
|
|
April 2021
|
Interest rate swap
|
|
|
3,274
|
|
|
Ps.
|
1,000,000
|
|
May 2022
|
Total liabilities
|
|
Ps.
|
227,062
|
|
|
|
|
|
|
UHI Warrants
As described in Note 3, in July 2015, the Group exchanged its investment in U.S.$1,125 million principal amount of Convertible Debentures due 2025 issued by UHI for Warrants that are exercisable for UHI’s common stock.
The Group determined the fair value of its investment in Warrants using the Black-Scholes model (“BSM”). The BSM involves the use of significant estimates and assumptions. These estimates and assumptions include the UHI stock’s spot price at valuation date and the stock’s expected volatility. UHI stock’s price at valuation date was obtained by using a discounted projected cash flow model. UHI stock’s volatility was obtained from publicly available information of comparable companies’ stock through determining an average of such companies’ annual volatility. Since the described methodology was an internal model with significant unobservable inputs, the UHI Warrants are classified as Level 3.
Unobservable inputs used as of March 31, 2016 and December 31, 2015 included UHI stock’s spot price of U.S.$441 per share and U.S.$443 per share, respectively, and UHI stock’s expected volatility of 33% and 29%, respectively.
Significant judgment was applied in assessing the qualitative factors mentioned in IAS 39
Financial Instruments: Recognition and Measurement
, to determine that the changes in cash flows, the different risk and rewards and contractual terms between the exchanged Convertible Debentures due 2025 issued by UHI and the received Warrants issued by UHI resulted in the derecognition of the Convertible Debentures (see Notes 3 and 4).
The Company’s management applied significant judgment to determine the classification of the Warrants issued by UHI. These warrants did not comply with the definition of a derivative financial instrument because the initial investment that the Group paid to acquire the original instrument (Convertible Debentures) was significant and a derivative requires no initial investment or one that is smaller than would be required for a contract with similar response to changes in market factors; therefore, the Group classified the Warrants issued by UHI as available-for-sale financial assets with changes in fair value recognized in other comprehensive income or loss in consolidated equity. Significant judgment was applied by the Company’s management in assessing that the characteristics of the Warrants are closer to an equity instrument in accordance with IAS 32
Financial Instruments: Presentation
(see Notes 3 and 4).
10.
|
Capital Stock and Long-term Retention Plan
|
At March 31, 2016, shares of capital stock and CPOs consisted of (in millions):
|
Authorized and Issued
(1)
|
Held by a Company’s Trust
Trust
(2)
|
Outstanding
|
Series “A” Shares
|
123,273.9
|
(7,918.9)
|
115,355.0
|
Series “B” Shares
|
58,982.9
|
(5,690.0)
|
53,292.9
|
Series “D” Shares
|
90,086.5
|
(5,302.5)
|
84,784.0
|
Series “L” Shares
|
90,086.5
|
(5,302.5)
|
84,784.0
|
Total
|
362,429.8
|
(24,213.9)
|
338,215.9
|
Shares in the form of CPOs
|
301,145.5
|
(17,725.5)
|
283,420.0
|
Shares not in the form of CPOs
|
61,284.3
|
(6,488.4)
|
54,795.9
|
Total
|
362,429.8
|
(24,213.9)
|
338,215.9
|
CPOs
|
2,573.9
|
(151.5)
|
2,422.4
|
(1)
|
As of March 31, 2016, the authorized and issued capital stock amounted to Ps.4,978,126 (nominal Ps.2,494,410).
|
(2)
|
In connection with the Company’s Long-Term Retention Plan.
|
A reconciliation of the number of shares and CPOs outstanding for the three months ended March 31, 2016 and 2015 is presented as follows (in millions):
|
Series “A” Shares
|
Series “B” Shares
|
Series “D” Shares
|
Series “L” Shares
|
Shares Outstanding
|
CPOs Outstanding
|
As of January 1, 2016
|
115,409.0
|
53,340.3
|
84,859.5
|
84,859.5
|
338,468.3
|
2,424.6
|
Acquired (1)
|
(54.0)
|
(47.4)
|
(75.5)
|
(75.5)
|
(252.4)
|
(2.2)
|
Released (1)
|
-
|
-
|
-
|
---
|
|
|
As of March 31, 2016
|
115,355.0
|
53,292.9
|
84,784.0
|
84,784.0
|
338,215.9
|
2,422.4
|
|
|
|
|
|
|
|
|
Series “A” Shares
|
Series “B” Shares
|
Series “D” Shares
|
Series “L” Shares
|
Shares Outstanding
|
CPOs Outstanding
|
As of January 1, 2015
|
115,036.5
|
53,330.9
|
84,844.4
|
84,844.4
|
338,056.2
|
2,424.1
|
Acquired (1)
|
(361.7)
|
(318.3)
|
(506.4)
|
(506.4)
|
(1,692.8)
|
(14.5)
|
Released (1)
|
-
|
-
|
-
|
-
|
-
|
-
|
As of March 31, 2015
|
114,674.8
|
53,012.6
|
84,338.0
|
84,338.0
|
336,363.4
|
2,409,6
|
(1)
|
By a Company’s trust in connection with the Company’s Long-Term Retention Plan.
|
Long-term Retention Plan
During the three months ended March 31, 2016, the trust for the Long-term Retention Plan acquired 252.4 million shares of the Company, in the form of 2.2 million CPOs, in the amount of Ps.208,016.
The Group accrued in equity attributable to stockholders of the Company a share-based compensation expense of Ps.321,289 for the three months ended March 31, 2016, which amount was reflected in consolidated operating income as administrative expense.
As of March 31, 2016 and December 31, 2015, the Company’s legal reserve amounted to Ps.2,139,007, and was classified into retained earnings in equity attributable to stockholders of the Company.
In April 2015, the Company’s stockholders approved the payment of a dividend of Ps.0.35 per CPO and Ps.0.002991452991 per share of Series “A”, “B”, “D” and “L” Shares, not in the form of a CPO, which was paid in cash in June 2015 in the aggregate amount of Ps.1,084,192.
In February 2016, the Company’s Board of Directors approved a proposal for a dividend of Ps.0.35 per CPO payable in the second quarter of 2016, subject to the approval of the Company’s stockholders.
12.
|
Transactions with Related Parties
|
The balances of receivables and payables between the Group and related parties as of March 31, 2016 and December 31, 2015, were as follows:
|
|
March 31, 2016
|
|
|
December 31,
2015
|
|
Current receivables:
|
|
|
|
|
|
|
Operadora de Centros de Espectáculos, S.A. de C.V.
|
|
Ps.
|
54,125
|
|
|
Ps.
|
54,827
|
|
Editorial Clío, Libros y Videos, S.A. de C.V.
|
|
|
21,141
|
|
|
|
20,644
|
|
Other
|
|
|
60,579
|
|
|
|
22,917
|
|
|
|
Ps.
|
135,845
|
|
|
Ps.
|
98,388
|
|
|
|
|
|
|
|
|
|
|
Current payables:
|
|
|
|
|
|
|
|
|
UHI, including Univision
|
|
Ps.
|
516,666
|
|
|
Ps.
|
367,545
|
|
DirecTV Group, Inc.
|
|
|
12,986
|
|
|
|
47,788
|
|
Other
|
|
|
24,969
|
|
|
|
27,702
|
|
|
|
Ps.
|
554,621
|
|
|
Ps.
|
443,035
|
|
In the three months ended March 31, 2016 and 2015, royalty revenue from Univision amounted to Ps.1,259,848 and Ps.988,630, respectively, and interest income from UHI amounted to Ps.65,091, in March 31, 2015.
In March 2015, the Group recognized in consolidated other income, net, a non-recurring income from Univision in the amount of U.S.$67.6 million (Ps.1,038,314), as a result of the early termination of a technical assistance agreement with Univision.
In July 2015, the Group recognized in consolidated other finance income, net, a cash amount of U.S.$135.1 million (Ps.2,194,981) paid by UHI for the exchange of the Group’s former investment in Convertible Debentures issued by UHI for Warrants that are exercisable for UHI’s common stock (see Notes 3 and 4).
Finance (expense) income for the three months ended March 31, 2016 and 2015, included:
|
|
2016
|
|
|
2015
|
|
Interest expense
|
|
Ps.
|
(1,983,300
|
)
|
|
Ps.
|
(1,477,706
|
)
|
Foreign exchange loss, net
|
|
|
(230,448
|
)
|
|
|
(866,873
|
)
|
Other finance expense, net
|
|
|
(102,940
|
)
|
|
|
-
|
|
Finance expense
|
|
|
(2,316,688
|
)
|
|
|
(2,344,579
|
)
|
Interest income
(1)
|
|
|
308,129
|
|
|
|
315,508
|
|
Other finance income, net
(2)
|
|
|
-
|
|
|
|
168,062
|
|
Finance income
|
|
|
308,129 483,570
|
|
|
|
|
|
Finance expense, net
|
|
Ps.
|
(2,008,559
|
)
|
|
Ps.
|
(1,861,009
|
)
|
(1)
|
This line item included interest income from the Group’s investment in Debentures issued by UHI in the aggregate amount of Ps.65,091 for the three months ended March 31, 2015.
|
(2)
|
This line item included a gain related to changes in fair value from an embedded derivative in a host contract related to the Group’s former investment in Convertible Debentures issued by UHI in the amount of Ps.225,851 for the three months ended March 31, 2015.
|
The analysis of deferred tax assets and liabilities is as follows:
|
|
March 31, 2016
|
|
|
December 31, 2015
|
|
Deferred tax assets:
|
|
|
|
|
|
|
Deferred tax assets to be recovered after more than 12 months
|
|
Ps.
|
14,428,682
|
|
|
Ps.
|
14,258,185
|
|
Deferred tax assets to be recovered within 12 months
|
|
|
5,189,758
|
|
|
|
5,104,715
|
|
Deferred tax liabilities:
|
|
|
|
|
|
|
|
|
Deferred tax liabilities to be paid after more than 12 months
|
|
|
(10,285,404
|
)
|
|
|
(10,767,190
|
)
|
Deferred tax liabilities to be paid within 12 months
|
|
|
(229,122
|
)
|
|
|
(930,672
|
)
|
Deferred tax assets, net
|
|
Ps.
|
9,103,914
|
|
|
Ps.
|
7,665,038
|
|
|
|
|
|
|
|
|
|
|
The deferred taxes as of March 31, 2016 and December 31, 2015, were principally derived from the following items:
|
|
|
|
|
|
March 31, 2016
|
|
|
December 31,
2015
|
|
Assets:
|
|
|
|
|
|
|
|
|
Accrued
liabilities
|
|
Ps.
|
2,741,987
|
|
|
Ps.
|
2,656,354
|
|
Allowance
for doubtful accounts
|
|
|
1,187,427
|
|
|
|
1,187,427
|
|
Customer
advances
|
|
|
2,597,447
|
|
|
|
2,598,037
|
|
Tax loss carryforwards
|
|
|
10,196,480
|
|
|
|
10,196,480
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Investments
|
|
|
(3,328,162
|
)
|
|
|
(3,504,137
|
)
|
Property, plant and equipment, net
|
|
|
(787,792
|
)
|
|
|
(954,678
|
)
|
Derivative financial instruments
|
|
|
(1,801
|
)
|
|
|
(1,801
|
)
|
Intangible assets and transmission rights
|
|
|
(3,069,745
|
)
|
|
|
(3,922,230
|
)
|
Prepaid expenses and other items
|
|
|
(1,030,155
|
)
|
|
|
(1,188,642
|
)
|
Deferred income taxes of Mexican companies
|
|
|
8,505,686
|
|
|
|
7,066,810
|
|
Deferred income taxes assets of foreign subsidiaries
|
|
|
195,348
|
|
|
|
195,348
|
|
Asset tax
|
|
|
402,880
|
|
|
|
402,880
|
|
Deferred income tax asset, net
|
|
Ps.
|
9,103,914
|
|
|
Ps.
|
7,665,038
|
|
15.
|
Earnings per CPO/Share
|
At March 31, 2016 and 2015 the weighted average of outstanding total shares, CPOs and Series “A”, Series “B”, Series “D” and Series “L” Shares (not in the form of CPO units), was as follows (in thousands):
|
|
March 31, 2016
|
|
|
March 31, 2015
|
|
Total Shares
|
|
|
338,420,680
|
|
|
|
337,576,810
|
|
CPOs
|
|
|
2,424,143
|
|
|
|
2,420,022
|
|
Shares not in the form of CPO units:
|
|
|
|
|
|
|
|
|
Series “A” Shares
|
|
|
54,795,232
|
|
|
|
54,433,556
|
|
Series “B” Shares
|
|
|
187
|
|
|
|
187
|
|
Series “D” Shares
|
|
|
239
|
|
|
|
239
|
|
Series “L” Shares
|
|
|
239
|
|
|
|
239
|
|
Basic earnings per CPO and per each Series “A”, Series “B”, Series “D” and Series “L” Share (not in the form of a CPO unit) for the three months ended March 31, 2016 and 2015, are presented as follows:
|
2016
|
|
2015
|
|
|
Per CPO
|
|
Per Each Series “A”, “B”, “D” and “L” Share
|
|
Per CPO
|
|
Per Each Series “A”, “B”, “D” and “L” Share
|
|
Net income attributable to stockholders of the Company
|
|
Ps.
|
0.21
|
|
|
Ps.
|
0.00
|
|
|
Ps.
|
0.51
|
|
|
Ps.
|
0.00
|
|
Diluted earnings per CPO and per Share attributable to stockholders of the Company:
|
|
March 31, 2016
|
|
|
March 31, 2015
|
|
Total Shares
|
|
|
362,429,887
|
|
|
|
362,429,887
|
|
CPOs
|
|
|
2,573,894
|
|
|
|
2,573,894
|
|
Shares not in the form of CPO units:
|
|
|
|
|
|
|
|
|
Series “A” Shares
|
|
|
58,926,613
|
|
|
|
58,926,613
|
|
Series “B” Shares
|
|
|
2,357,208
|
|
|
|
2,357,208
|
|
Series “D” Shares
|
|
|
239
|
|
|
|
239
|
|
Series “L” Shares
|
|
|
239
|
|
|
|
239
|
|
Diluted earnings per CPO and per each Series “A”, Series “B”, Series “D” and Series “L” Share (not in the form of a CPO unit) for the three months ended March 31, 2016 and 2015, are presented as follows:
|
2016
|
|
2015
|
|
|
Per CPO
|
|
Per Each Series “A”, “B”, “D” and “L” Share
|
|
Per CPO
|
|
Per Each Series “A”, “B”, “D” and “L” Share
|
|
Net income attributable to stockholders of the Company
|
|
Ps.
|
0.20
|
|
|
Ps.
|
0.00
|
|
|
Ps.
|
0.47
|
|
|
Ps.
|
0.00
|
|
16. Segment Information
The table below presents information by segment and a reconciliation to consolidated total for the three months ended March 31:
2016:
|
|
Total Revenues
|
|
|
Intersegment Revenues
|
|
|
Consolidated Revenues
|
|
|
Segment Income
|
|
Content
|
|
Ps.
|
7,526,436
|
|
|
Ps.
|
363,372
|
|
|
Ps.
|
7,163,064
|
|
|
Ps.
|
2,655,033
|
|
Sky
|
|
|
5,349,619
|
|
|
|
8,080
|
|
|
|
5,341,539
|
|
|
|
2,409,426
|
|
Cable
|
|
|
7,621,114
|
|
|
|
36,582
|
|
|
|
7,584,532
|
|
|
|
3,152,407
|
|
Other Businesses
|
|
|
1,775,016
|
|
|
|
123,172
|
|
|
|
1,651,844
|
|
|
|
141,459
|
|
Segment totals
|
|
|
22,272,185
|
|
|
|
531,206
|
|
|
|
21,740,979
|
|
|
|
8,358,325
|
|
Reconciliation to consolidated amounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eliminations and corporate expenses
|
|
|
(531,206
|
)
|
|
|
(531,206
|
)
|
|
|
|
|
|
|
(544,176
|
)
|
Depreciation and amortization expense
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(4,009,881
|
)(1)
|
Consolidated total before other expense
|
|
|
21,740,979
|
|
|
|
-
|
|
|
|
21,740,979
|
|
|
|
3,804,268
|
|
Other expense, net
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(495,185
|
)
|
Consolidated total
|
|
Ps.
|
21,740,979
|
|
|
Ps.
|
-
|
|
|
Ps.
|
21,740,979
|
|
|
Ps.
|
3,309,083
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenues
|
|
|
Intersegment Revenues
|
|
|
Consolidated Revenues
|
|
|
Segment Income
|
|
2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Content
|
|
Ps.
|
7,020,962
|
|
|
Ps.
|
269,340
|
|
|
Ps.
|
6,751,622
|
|
|
Ps.
|
2,609,005
|
|
Sky
|
|
|
4,621,733
|
|
|
|
33,319
|
|
|
|
4,588,414
|
|
|
|
2,149,076
|
|
Cable
|
|
|
6,714,451
|
|
|
|
33,499
|
|
|
|
6,680,952
|
|
|
|
2,657,764
|
|
Other Businesses
|
|
|
1,918,415
|
|
|
|
80,040
|
|
|
|
1,838,375
|
|
|
|
221,583
|
|
Segment totals
|
|
|
20,275,561
|
|
|
|
416,198
|
|
|
|
19,859,363
|
|
|
|
7,637,428
|
|
Reconciliation to consolidated amounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eliminations and corporate expenses
|
|
|
(416,198
|
)
|
|
|
(416,198
|
)
|
|
|
-
|
|
|
|
(410,541
|
)
|
Depreciation and amortization expense
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(3,343,137
|
)
|
Consolidated total before other expense
|
|
|
19,859,363
|
|
|
|
-
|
|
|
|
19,859,363
|
|
|
|
3,883,750
|
(1)
|
Other expense, net
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
926,477
|
|
Consolidated total
|
|
Ps.
|
19,859,363
|
|
|
Ps.
|
-
|
|
|
Ps.
|
19,859,363
|
|
|
Ps.
|
4,810,227
|
(2)
|
(1) Consolidated total represents income before other expense.
(2) Consolidated total represents consolidated operating income.
Seasonality of Operations
The Group’s results of operations are seasonal. The Group typically recognizes a large percentage of its consolidated net sales (principally advertising) in the fourth quarter in connection with the holiday shopping season. In 2015 and 2014, the Group recognized 28.3% and 30.0%, respectively, of its annual consolidated net sales in the fourth quarter of the year. The Group’s costs, in contrast to its revenues, are more evenly incurred throughout the year and generally do not correlate to the amount of advertising sales.
The consolidated net income attributable to stockholders of the Company for each of the four quarters in the period ended March 31, 2016, is presented as follows:
Quarter
|
|
Quarter
|
|
|
Accumulated
|
|
2nd / 15
|
|
Ps.
|
1,328,732
|
|
|
Ps.
|
2,782,177
|
|
3rd / 15
|
|
|
6,545,753
|
|
|
|
9,327,930
|
|
4th / 15
|
|
|
1,571,205
|
|
|
|
10,899,135
|
|
1st / 16
|
|
|
600,434
|
|
|
|
600,434
|
|
In March 2015, the investigative authority of the IFT issued a preliminary opinion that presumed the probable existence of substantial power in the market of restricted television and audio services in Mexico, with respect to the Company and certain of its subsidiaries. On September 30, 2015, the Governing Board of the IFT determined that the Group does not have substantial power in such market (“IFT Resolution”). Although this resolution is final at the administrative level, certain third parties have filed
amparo
proceedings challenging the constitutionality of the IFT Resolution; those challenges are still under review by the relevant courts and the Company’s management is unable to predict the outcome of those challenges.
There are several legal actions and claims pending against the Group which are filed in the ordinary course of business. In the opinion of the Company’s management, none of these actions and claims is expected to have a material adverse effect on the Group’s financial statements as a whole; however, the Company’s management is unable to predict the outcome of any of these legal actions and claims.
- - - - - - -
Description of significant events and transactions
|
|
See Note 3
|
Description of accounting policies and methods of computation followed in interim financial statements
|
Accounting Policies
The principal accounting policies followed by the Group and used in the preparation of these consolidated financial statements are summarized below.
(a)
Basis of Presentation
The consolidated financial statements of the Group as of December 31, 2014 and 2013, and for the years ended December 31, 2014, 2013 and 2012, are presented in accordance with International Financial Reporting Standards (“IFRSs”) as issued by the International Accounting Standards Board (“IASB”) for financial reporting purposes. IFRSs comprise: (i) International Financial Reporting Standards (“IFRS”); (ii) International Accounting Standards (“IAS”); (iii) IFRS Interpretations Committee (“IFRIC”) Interpretations; and (iv) Standing Interpretations Committee (“SIC”) Interpretations.
The consolidated financial statements have been prepared on a historical cost basis, except by the measurement at fair value of temporary investments, derivative financial instruments, available-for-sale financial assets, equity financial instruments, and share-based payments as described below.
The preparation of consolidated financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group accounting policies. Changes in assumptions may have a significant impact on the consolidated financial statements in the period the assumptions changed. Management believes that the underlying assumptions are appropriate. The areas involving a higher degree of judgment or complexity, or areas where estimates and assumptions are significant to the Group’s financial statements are disclosed in Note 5 to these consolidated financial statements.
These consolidated financial statements were authorized for issuance on March 31, 2015, by the Group’s Chief Financial Officer.
(b)
Consolidation
The financial statements of the Group are prepared on a consolidated basis and include the assets, liabilities and results of operations of all companies in which the Company has a controlling interest (subsidiaries). All intercompany balances and transactions have been eliminated from the financial statements.
Subsidiaries
Subsidiaries are all entities over which the Company has control. The Group controls an entity when this is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The existence and effects of potential voting rights that are currently exercisable or convertible are considered when assessing whether or not the Company controls another entity. The subsidiaries are consolidated from the date on which control is obtained by the Company and cease to consolidate from the date on which said control is lost.
The Group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group recognizes any non-controlling interest in the acquiree on an acquisition-by-acquisition basis at the non-controlling interest’s proportionate share of the recognized amounts of acquiree’s identifiable net assets.
Acquisition-related costs are expensed as incurred.
Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of the subsidiary acquired, the difference is recognized in income or loss.
Changes in ownership interests in subsidiaries without change of control
Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.
Disposal of subsidiaries
When the Company ceases to have control any retained interest in the entity is re-measured to its fair value at the date when control is lost, with the change in carrying amount recognized in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognized in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This means that amounts previously recognized in other comprehensive income are reclassified to income or loss.
At December 31, 2014, 2013 and 2012, the main subsidiaries of the Company were as follows:
Entity
|
Company’s Ownership Interest
(1)
|
|
Business Segment
(2)
|
Grupo Telesistema, S.A. de C.V. and subsidiaries
|
100%
|
|
Content
|
Televisa, S.A. de C.V. ("Televisa") (3)100%
|
100%
|
|
Content
|
G.Televisa-D, S.A. de C.V. (3)
|
100%
|
|
Content
|
Multimedia Telecom, S.A. de C.V. (4)
|
100%
|
|
Content
|
Innova, S. de R.L. de C.V. and subsidiaries (collectively, "Sky") (5)
|
58.7%
|
|
Sky
|
Empresas CablevisiOn, S.A.B. de C.V. and subsidiaries (collectively, "Empresas CablevisiOn") (6)
|
51%
|
|
Telecommunications
|
Subsidiaries engaged in the Cablemas business (7)
|
100%
|
|
Telecommunications
|
TelevisiOn Internacional, S.A. de C.V. and subsidiaries (collectively, "Tvr) (9)
|
50%
|
|
Telecommunications
|
Cablestar, S.A. de C.V. and subsidiaries (9)
|
66.1%
|
|
Telecommunications
|
Grupo Cable TV, S.A. de C.V. and subsidiaries (collectively, "Cablecom") (10)
|
100%
|
|
Telecommunications
|
Corporativo Vasco de Quiroga, S.A. de C.V. (11)
|
100%
|
|
Telecommunications
|
Consorcio Nekeas, S.A. de C.V. and subsidiaries (see Note 27)
|
100%
|
|
Other Businesses
|
Editorial Televisa, S.A. de C.V. and subsidiaries
|
100%
|
|
Other Businesses
|
Grupo Distribuidoras Intermex, S.A. de C.V. and subsidiaries
|
100%
|
|
Other Businesses
|
Sistema RadiOpolis, S.A. de C.V. and subsidiaries (12)
|
50%
|
|
Other Businesses
|
Televisa Juegos, S.A. de C.V. and subsidiaries
|
100%
|
|
Other Businesses
|
(1)
|
Percentage of equity interest directly or indirectly held by the Company in the parent company of the consolidated entity.
|
(2)
|
See Note 25 for a description of each of the Group’s business segments.
|
(3)
|
Televisa, S.A. de C.V. and G.Televisa-D, S.A. de C.V. are direct subsidiaries of Grupo Telesistema, S.A. de C.V.
|
(4)
|
Multimedia Telecom, S.A. de C.V. is a indirect subsidiary of Grupo Telesistema, S.A. de C.V. through which it owns 7.8% of the capital stock of BMP and maintains an investment in Convertible Debentures issued by BMP (see Notes 9 and 10).
|
(5)
|
Innova, S. de R.L. de C.V. is an indirect majority-owned subsidiary of the Company and a direct majority-owned subsidiary of Innova Holdings, S. de R.L. de C.V. Sky is a satellite television provider in Mexico, Central America and the Dominican Republic. Although the Company holds a majority of Sky’s equity and designates a majority of the members of Sky’s Board of Directors, the non-controlling interest has certain governance and veto rights in Sky, including the right to block certain transactions between the companies in the Group and Sky. These veto rights are protective in nature and do not affect decisions about the relevant activities.
|
(6)
|
Empresas Cablevisión, S.A.B. de C.V. is an indirect majority-owned subsidiary of the Company and a direct majority-owned subsidiary of Editora Factum, S.A. de C.V.
|
((7)
|
The Cablemás business includes the operation of telecommunication networks covering 60 cities of Mexico. As of December 31, 2014, some subsidiaries of the Cablemás business are directly owned by the Company, and some other by Consorcio Nekeas, S.A. de C.V.
|
(8)
|
TVI is an indirect subsidiary of the Company and a direct subsidiary of Cable TV Internacional, S.A. de C.V. The Company consolidates TVI because it appoints the majority of the members of the Board of Directors of TVI.
|
(9)
|
Cablestar, S.A. de C.V. is an indirect majority-owned subsidiary of Empresas Cablevisión, S.A.B. de C.V. and a direct majority-owned subsidiary of Milar, S.A. de C.V.
|
(10)
|
Grupo Cable TV, S.A. de C.V. was acquired by the Group in 2014 (see Note 3).
|
(11)
|
Corporativo Vasco de Quiroga, S.A. de C.V. is a direct subsidiary of the Company through which the Company owned 50% of the capital stock of GSF Telecom Holdings, S.A.P.I. de C.V. (“GSF”) (see Notes 3 and 27).
|
(12)
|
Sistema Radiópolis, S.A. de C.V. (“Radiópolis”) is an indirect subsidiary of the Company. The Company controls Radiópolis as it has the right to appoint the majority of the members of the Board of Directors of Radiópolis.
|
The Group’s Content, Sky and Telecommunications segments, as well as the Group’s Radio business, which is reported in the Other Businesses segment, require governmental concessions and special authorizations for the provision of broadcasting and telecommunications services in Mexico. Such concessions are granted for a fixed term, subject to renewal in accordance with the Mexican Telecommunications and Broadcasting Law (“Ley Federal de Telecomunicaciones y Radiodifusión” or “LFTR”).
Renewal of concessions for the Content segment and the Radio business require, among others: (i) to request such renewal to the Mexican Institute of Telecommunications (“Instituto Federal de Telecomunicaciones” or “IFT”) within the year prior to the last fifth period of the fixed term of the related concession; (ii) to be in compliance with the concession holder’s obligations under the LFTR, other applicable regulations, and the concession title; (iii) a declaration by IFT that there is no public interest in recovering the spectrum granted under the related concession; and (iv) the acceptance by the concession holder of any new conditions for renewing the concession as set forth by IFT, including the payment of a related fee. No spectrum granted for broadcasting services in Mexico has been recovered by the Mexican government in the past several years for public interest reasons; however, the Company’s management is unable to predict the outcome of any action by IFT in this regard. Renewal of concessions for the Sky and Telecommunications segments require, among others: (i) to request its renewal to IFT in the year prior to the last fifth period of the fixed term of the related concession; (ii) to be in compliance with the concession holder’s obligations under the LFTR, other applicable regulations, and the concession title; and (iii) the acceptance by the concession holder of any new conditions for renewing the concession as set forth by IFT. IFT shall resolve any request for renewal of the telecommunications concessions within 180 business days of its request. Failure to respond within such period of time shall be interpreted as if the request for renewal has been granted.
Also, the Group’s Gaming business, which is reported in the Other Businesses segment, requires a permit granted by the Mexican Federal Government for a fixed term, subject to renewal in accordance with Mexican law. Additionally, the Group’s Sky businesses in Central America and the Dominican Republic require concessions or permits granted by local regulatory authorities for a fixed term, subject to renewal in accordance with local laws.
The accounting guidelines provided by IFRIC 12 Service Concession Arrangements are not applicable to the Group.
At December 31, 2014, the expiration dates of the Group’s concessions and permits were as follows:
Segments
|
Expirations Dates
|
|
|
Content
|
In 2021
|
Sky
|
Various from 2015 to 2027
|
Telecommunications
|
Various from 2015 to 2044
|
Other Businesses:
|
|
Radio
|
Various from 2015 to 2020
|
Gaming
|
In 2030
|
The concessions or permits held by the Group are not subject to any significant pricing regulations in the ordinary course of business.
(c)
Investments in Joint Ventures and Associates
Investments in joint arrangements are classified as either joint operations or joint ventures depending on the contractual rights and obligations of each investor. Joint ventures are those joint arrangements where the Group exercises joint control with other stockholder or more stockholders without exercising control individually, and have rights to the net assets of the joint arrangements. Associates are those entities over which the Group has significant influence but not control, generally those entities with a shareholding of between 20% and 50% of the voting rights. Investments in joint ventures and associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognized at cost, and the carrying amount is increased or decreased to recognize the investor’s share of the net assets of the investee after the date of acquisition.
The Group has investments in joint ventures and associates, including a 7.8% and 8% equity interest in BMP as of December 31, 2014 and 2013, respectively, and a 50% joint interest in GSF as of December 31, 2013 (see Notes 3, 9 and 10).
The Group recognizes its share of losses of a joint venture or an associate up to the amount of its initial investment, subsequent capital contributions and long-term loans, or beyond that when guaranteed commitments have been made by the Group in respect of obligations incurred by investees, but not in excess of such guarantees. If a joint venture or an associate for which the Group had recognized a share of losses up to the amount of its guarantees generates net income in the future, the Group would not recognize its share of this net income until the Group first recognizes its share of previously unrecognized losses.
If the Group’s share of losses of a joint venture or an associate equals or exceeds its interest in the investee, the Group discontinues recognizing its share of further losses. The interest in a joint venture or an associate is the carrying amount of the investment in the investee under the equity method together with any other long-term investment that, in substance, form part of the Group’s net investment in the investee. After the Group’s interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the joint venture or associate.
(d)
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the Group’s executive officers (“chief operating decision makers”) who are responsible for allocating resources and assessing performance for each of the Group’s operating segments.
(e)
Foreign Currency Translation
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (“functional currency”). The presentation and functional currency of the Group’s consolidated financial statements is the Mexican peso, which is used for compliance with its legal and tax obligations.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or measurement where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the income statement as part of finance income or expense, except when deferred in other comprehensive income as qualifying cash flow hedges and qualifying net investment hedges.
Changes in the fair value of monetary securities denominated in foreign currency classified as available for sale are analyzed between exchange differences resulting from changes in the amortized cost of the security and other changes in the carrying amount of the security. Translation differences related to changes in amortized cost are recognized in income or loss, and other changes in carrying amount are recognized in other comprehensive income or loss.
Translation of Non-Mexican subsidiaries’ financial statements
The financial statements of all the Group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows: (a) assets and liabilities are translated at the closing rate at the date of the statement of financial position; (b) income and expenses are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and (c) all resulting translation differences are recognized in other comprehensive income or loss.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. Translation differences arising are recognized in other comprehensive income or loss.
Assets and liabilities of non-Mexican subsidiaries that use the Mexican Peso as a functional currency are translated into Mexican Pesos by utilizing the exchange rate of the statement of financial position date for monetary assets and liabilities, and historical exchange rates for nonmonetary items, with the related adjustment included in the consolidated statement of income as income or finance expense.
Beginning in the third quarter of 2011, the Group designated as an effective hedge of foreign exchange exposure a portion of the outstanding principal amount of its U.S. dollar denominated long-term debt in connection with its net investment in shares of common stock of BMP, which amounted to U.S.$237.6 million (Ps.3,507,389) and U.S.$218.9 million (Ps.2,862,147) as of December 31, 2014 and 2013, respectively. Consequently, any foreign exchange gain or loss attributable to this designated hedging long-term debt is credited or charged directly to other comprehensive income or loss as a cumulative result from foreign currency translation (see Notes 9 and 23).
(f)
Cash and Cash Equivalents and Temporary Investments
Cash and cash equivalents consist of cash on hand and all highly liquid investments with an original maturity of three months or less at the date of acquisition. Cash is stated at nominal value and cash equivalents are measured at fair value, and the changes in the fair value are recognized in the income statement.
Temporary investments consist of short-term investments in securities, including without limitation debt with a maturity of over three months and up to one year at the date of acquisition, stock and other financial instruments, or a combination thereof, as well as current maturities of noncurrent held-to-maturity securities. Temporary investments are measured at fair value with changes in fair value recognized in finance income in the consolidated income statement, except the current maturities of non-current held-to-maturity securities which are measured at amortized cost.
As of December 31, 2014 and 2013, cash equivalents and temporary investments primarily consisted of fixed short-term deposits and corporate fixed income securities denominated in U.S. dollars and Mexican pesos, with an average yield of approximately 0.10% for U.S. dollar deposits and 3.29% for Mexican peso deposits in 2014, and approximately 0.12% for U.S. dollar deposits and 4.12% for Mexican peso deposits in 2013.
(g)
T
ansmission Rights and Programming
Programming is comprised of programs, literary works, production talent advances and films.
Transmission rights and literary works are valued at the lesser of acquisition cost and net realizable value. Programs and films are valued at the lesser of production cost, which consists of direct production costs and production overhead, and net realizable value. Payments for production talent advances are initially capitalized and subsequently included as direct or indirect costs of program production.
The Group’s policy is to capitalize the production costs of programs which benefit more than one annual period and amortize them over the expected period of future program revenues based on the Company’s historical revenue patterns for similar productions.
Transmission rights, programs, literary works, production talent advances and films are recorded at acquisition or production cost. Cost of sales is calculated for the month in which such transmission rights, programs, literary works, production talent advances and films are matched with related revenues.
Transmission rights are amortized over the lives of the contracts. Transmission rights in perpetuity are amortized on a straight-line basis over the period of the expected benefit as determined by past experience, but not exceeding 25 years.
(h)
Inv
entories
Inventories of paper, magazines, materials and supplies for maintenance of technical equipment are recorded at the lower of cost or its net realization value. The net realization value is the estimated selling price in the normal course of business, less estimated costs to conduct the sale. Cost is determined using the average cost method.
(i)
Financial Assets
The Group classifies its financial assets in the following categories: loans and receivables, held-to-maturity investments, fair value through income and available-for-sale financial assets. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.
Loans and Receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are initially recognized at fair value plus transaction costs and subsequently carried at amortized cost using the effective interest method, with changes in carrying value recognized in the income statement in the line which most appropriately reflects the nature of the item or transaction. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non-current assets. The Group’s loans and receivables are presented as “trade notes and accounts receivable” and “other accounts and notes receivable” in the consolidated statement of financial position (see Note 7).
Held-to-maturity Investments
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Group’s management has the positive intention and ability to hold to maturity. After initial measurement, held-to-maturity investments are measured at amortized cost using the effective interest rate method, less impairment, if any. Any gain or loss arising from these investments is included in finance income or loss in the consolidated statement of income. Held-to-maturity investments are included in investments in financial instruments, except for those with maturities less than 12 months from the end of the reporting period, which are classified as temporary investments (see Note 9).
Available-for-sale Financial Assets
Available-for-sale financial assets are non-derivative financial assets that are not classified as loans and receivables, held-to-maturity investments or financial assets at fair value through income or loss, and include debt securities and equity instruments. Debt securities in this category are those that are intended to be held for an indefinite period of time and that may be sold in response to needs for liquidity or in response to changes in the market conditions. Equity instruments in this category are those of companies in which the Group does not exercise joint control nor significant influence, but intent to hold for an indefinite term, and are neither classified as held for trading nor designated at fair value through income. After initial measurement, available-for-sale assets are measured at fair value with unrealized gains or losses recognized as other comprehensive income or loss until the investment is derecognized or the investment is determined to be impaired, at which time the cumulative gain or loss is recognized in the consolidated statement of income either in other finance income or expense (debt securities) or other income or expense (equity instruments). Interest earned whilst holding available-for-sale financial assets is reported as interest income using the effective interest rate method (see Notes 9 and 14).
Financial Assets at Fair Value through Income
Financial assets at fair value through income are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Derivatives are also categorized as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if expected to be settled within 12 months, otherwise they are classified as non-current.
Impairment of Financial Assets
The Group assesses at each statement of financial position date whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective and other-than-temporary evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset. If it is determined that a financial asset or group of financial assets have sustained a decline other than temporary in their value a charge is recognized in income in the related period.
For financial assets classified as held-to-maturity the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate.
Impairment of Financial Assets Recognized at Amortized Cost
The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets measured at amortized cost is impaired. A financial asset or group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a “loss event”) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.
Offsetting of financial instruments
Financial assets are offset against financial liabilities and the net amount reported in the consolidated statement of financial position if, and only when the Group (i) currently has a legally enforceable right to set off the recognized amounts; and (ii) intends either to settle on a net basis, or to realize the assets and settle the liability simultaneously.
(j)
Property, Plant and Equipment
Property, plant and equipment are recorded at acquisition cost.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to income or loss during the financial period in which they are incurred.
Land is not depreciated. Depreciation of property, plant and equipment is based upon the carrying value of the assets in use and is computed using the straight-line method over the estimated useful lives of the asset, as follows:
|
Estimated useful lives
|
|
|
Buildings
|
20-65 years
|
Building improvements
|
5-20 years
|
Technical equipment
|
3-25 years
|
Satellite transponders
|
15 years
|
Furniture and fixtures
|
3-11 years
|
Transportation equipment
|
4-8 years
|
Computer equipment
|
3-5 years
|
Leasehold improvements
|
5-20 years
|
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognized within other income or expense in the consolidated income statement.
(k)
Intangible Assets
Intangible assets are recognized at acquisition cost. Intangible assets acquired through business combinations are recorded at fair value at the date of acquisition. Intangible assets with indefinite useful lives, which include goodwill, trademarks and concessions, are not amortized, and subsequently recognized at cost less accumulated impairment losses. Intangible assets with finite useful lives are amortized on a straight-line basis over their estimated useful lives, as follows:
|
Estimated useful lives
|
|
|
Licenses
|
3-14 years
|
Subscriber lists
|
4-10 years
|
Other intangible assets
|
3-20 years
|
Trademarks
The Group determines its trademarks to have an indefinite life when they are expected to generate net cash inflows for the Group indefinetely. Additionally, the Group considers that there are no legal, regulatory or contractual provisions that limit the useful lives of trademarks.
Concessions
The Group defined concessions to have an indefinite life due to the fact that the Group has a history of renewing its concessions upon expiration, has maintained the concessions granted by the Mexican government, and has no foreseeable limit to the period over which the assets are expected to generate net cash inflows. In addition, the Group is committed to continue to invest for the long term to extend the period over which the broadcasting and telecommunications concessions are expected to continue to provide economic benefits.
Goodwill
Goodwill arises on the acquisition of subsidiaries and represents the excess of the consideration transferred over the Group’s interest in net fair value of the identifiable assets, liabilities and contingent liabilities of the acquiree and the fair value of the non-controlling interest in the acquiree.
For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash generating units (“CGUs”), or groups of CGUs, that are expected to benefit from the synergies of the combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level.
Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate a potential impairment. The carrying value of goodwill is compared to the recoverable amount, which is the higher of value in use and the fair value less costs to sell. Any impairment is recognized as an expense and may be subsequently reversed under certain circumstances.
(l)
Impairment of Long-lived Assets
The Group reviews for impairment the carrying amounts of its long-lived assets, tangible and intangible, including goodwill (see Note 12), at least once a year, or whenever events or changes in business circumstances indicate that these carrying amounts may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. To determine whether an impairment exists, the carrying value of the reporting unit is compared with its recoverable amount. Fair value estimates are based on quoted market values in active markets, if available. If quoted market prices are not available, the estimate of fair value is based on various valuation techniques, including discounted value of estimated future cash flows, market multiples or third-party appraisal valuations.
(m)
Trade Accounts Payable and Accrued Expenses
Trade accounts payable and accrued expenses are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade accounts payable and accrued expenses are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.
Trade accounts payable and accrued expenses are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method.
Trade accounts payable and accrued expenses are presented as a single item of consolidated current liabilities in the consolidated statements of financial position as of December 31, 2014 and 2013. Trade accrued expenses were previously reported as a part of consolidated other current liabilities in the consolidated statement of financial position as of December 31, 2013.
(n)
Debt
Debt is recognized initially at fair value, net of transaction costs incurred. Debt is subsequently carried at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the income statement over the period of the debt using the effective interest method.
Fees paid on the establishment of debt facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a pre-payment for liquidity services and amortized over the period of the facility to which it relates.
Short-term debt and current portion of long-term debt include interest payable in the consolidated statements of financial position as of December 31, 2014 and 2013. Interest payable was previously presented as a separate line item of consolidated current liabilities in the consolidated statement of financial position as of December 31, 2013.
(o)
Customer Deposits and Advances
Customer deposit and advance agreements for television advertising services provide that customers receive preferential prices that are fixed for the contract period for television broadcast advertising time based on rates established by the Group. Such rates vary depending on when the advertisement is aired, including the season, hour, day and type of programming.
(p)
Provisions
Provisions are recognized when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognized for future operating losses.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provisions due to passage of time is recognized as interest expense.
(q)
Equity
The capital stock and other equity accounts include the effect of restatement through December 31, 1997, determined by applying the change in the Mexican National Consumer Price Index between the dates capital was contributed or net results were generated and December 31, 1997, the date through which the Mexican economy was considered hyperinflationary under the guidelines of the IFRSs. The restatement represented the amount required to maintain the contributions and accumulated results in Mexican Pesos in purchasing power as of December 31, 1997.
Where any company in the Group purchases shares of the Company’s capital stock (shares repurchased), the consideration paid, including any directly attributable incremental costs is deducted from equity attributable to stockholders of the Company until the shares are cancelled, reissued, or sold. Where such shares repurchased are subsequently reissued or sold, any consideration received, net of any directly attributable incremental transaction costs, is included in equity attributable to stockholders of the Company.
(r)
Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable, and represents amounts receivable for services provided. The Group recognizes revenue when the amount of revenue can be reliably measured; when it is probable that future economic benefits will flow to the entity; and when specific criteria have been met for each of the Group’s activities, as described below. The Group bases its estimate of return on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.
The Group derives the majority of its revenues from media and entertainment-related business activities both in Mexico and internationally. Revenues are recognized when the service is provided and collection is probable. A summary of revenue recognition policies by significant activity is as follows:
•
|
Advertising revenues, including deposits and advances from customers for future advertising, are recognized at the time the advertising services are rendered.
|
•
|
Revenues from program services for network subscription and licensed and syndicated television programs are recognized when the programs are sold and become available for broadcast.
|
•
|
Revenues from magazine subscriptions are initially deferred and recognized proportionately as products are delivered to subscribers. Revenues from the sales of magazines are recognized on the date of circulation of delivered merchandise, net of a provision for estimated returns.
|
•
|
Revenues from publishing distribution are recognized upon distribution of the products.
|
•
|
Sky program service revenues, including advances from customers for future direct-to-home (“DTH”) program services, are recognized at the time the service is provided.
|
•
|
Cable television, internet and telephone subscription, and pay-per-view and installation fees are recognized in the period in which the services are rendered.
|
•
|
Revenues from telecommunications and data services are recognized in the period in which these services are provided. Telecommunications services include long distance and local telephony, as well as leasing and maintenance of telecommunications facilities.
|
•
|
Revenues from attendance to soccer games, including revenues from advance ticket sales for soccer games and other promotional events, are recognized on the date of the relevant event.
|
•
|
Motion picture production and distribution revenues are recognized as the films are exhibited.
|
•
|
Gaming revenues consist of the net win from gaming activities, which is the difference between amounts wagered and amounts paid to winning patrons.
|
In respect to sales of multiple products or services, the Group evaluates whether it has fair value evidence for each deliverable in the transaction. For example, the Group sells cable television, internet and telephone subscription to subscribers in a bundled package at a rate lower than if the subscriber purchases each product on an individual basis. Subscription revenues received from such subscribers are allocated to each product in a pro-rata manner based on the fair value of each of the respective services.
(s)
Interest Income
Interest income is recognized using the effective interest method. When a loan and receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loan and receivables is recognized using the original effective interest rate.
(t)
Employee Benefits
Pension and Seniority Premium Obligations
Plans exist for pensions and seniority premiums (post-employment benefits), for most of the Group’s employees funded through irrevocable trusts. Increases or decreases in the consolidated liability or asset for post-employment benefits are based upon actuarial calculations. Contributions to the trusts are determined in accordance with actuarial estimates of funding requirements. Payments of post-employment benefits are made by the trust administrators. The defined benefit obligation is calculated annually using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of government bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension obligation.
In the first quarter of 2013, the Group adopted the provisions of IAS 19, Employee Benefits, as amended, which became effective on January 1, 2013. The amended IAS 19 eliminated the corridor approach for the recognition of remeasurement of post-employment benefit obligations, and requires the calculation of finance costs on a net funding basis. Also, the amended IAS 19 requires the recognition of past service cost as an expense at the earlier of the following dates: (i) when the plan amendment or curtailment occurs; and (ii) when the entity recognizes related restructuring costs or termination benefits. As a result of the adoption of the amended IAS 19, the Group adjusted a consolidated unamortized past service cost balance and consolidated retained earnings as of January 1, 2013 in the aggregate amount of Ps.102,902 (see Note 15).
Remeasurement of post-employment benefit obligations related to experience adjustments and changes in actuarial assumptions of post-employment benefits are recognized in the period in which they are incurred as part of other comprehensive income or loss in consolidated equity.
Profit Sharing
The employees’ profit sharing required to be paid under certain circumstances in Mexico, is recognized as a direct benefit to employees in the consolidated statements of income in the period in which it is incurred.
Termination Benefits
Termination benefits, which mainly represent severance payments by law, are recorded in the consolidated statement of income. The Group recognizes termination benefits at the earlier of the following dates: (a) when the Group can no longer withdraw the offer of those benefits; and (b) when the entity recognizes costs for a restructuring and involves the payment of termination benefits.
(u)
Income Taxes
The income tax expense for the period comprises current and deferred income tax. Income tax is recognized in the consolidated statement of income, except to the extent that it relates to items recognized in other comprehensive income or directly in equity. In this case, the income tax is also recognized in other comprehensive income.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the statement of financial position date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax liabilities are not recognized if they arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction (other than in a business combination) that at the time of the transaction affects neither accounting nor taxable income or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the statement of financial position date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled.
Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences and tax loss carryforwards can be utilized. For this purpose, the Group takes into consideration all available positive and negative evidence, including factors such as market conditions, industry analysis, projected taxable income, carryforward periods, current tax structure, potential changes or adjustments in tax structure, and future reversals of existing temporary differences.
Deferred income tax liabilities are provided on taxable temporary differences associated with investments in subsidiaries, joint ventures and associates, except for deferred income tax liabilities where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax assets are provided on deductible temporary differences associated with investments in subsidiaries, joint ventures and associates, to the extent that it is probable that there will be sufficient taxable income against which to utilize the benefit of the temporary difference and it is expected to reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. In the last quarter of 2013, the Mexican Congress enacted a new Tax Reform (the “2014 Tax Reform”), which became effective as of January 1, 2014. Among the tax reforms approved by the Mexican Congress, one of the most relevant changes was the elimination of the tax consolidation regime allowed for Mexican controlling companies through December 31, 2013 (see Note 23).
Through December 31, 2013, current income tax assets were offset against current income tax liabilities, and deferred income tax assets were offset against deferred income tax liabilities, of the Company’s Mexican subsidiaries that were allowed to consolidate their income or loss for income tax purposes, as these assets and liabilities were related to income tax levied by the same taxation authority on a consolidated taxable entity basis. Beginning on January 1, 2014, as a result of the 2014 Tax Reform, the Company is no longer allowed to consolidate income or loss of its Mexican subsidiaries for income tax purposes. Accordingly, current income tax assets and current income tax liabilities, and deferred income tax assets and deferred income tax liabilities, of Mexican companies in the Group as of December 31, 2014, are no longer offset as they relate to income taxes levied by the taxation authority on each separate taxable entity (see Note 23).
(v)
Derivative Financial Instruments
The Group recognizes derivative financial instruments as either assets or liabilities in the consolidated statements of financial position and measures such instruments at fair value. The accounting for changes in the fair value of a derivative financial instrument depends on the intended use of the derivative financial instrument and the resulting designation. For a derivative financial instrument designated as a cash flow hedge, the effective portion of such derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income and subsequently reclassified into income when the hedged exposure affects income. The ineffective portion of the gain or loss is reported in income immediately. For a derivative financial instrument designated as a fair value hedge, the gain or loss is recognized in income in the period of change together with the offsetting loss or gain on the hedged item attributed to the risk being hedged. For derivative financial instruments that are not designated as accounting hedges, changes in fair value are recognized in income in the period of change. During the years ended December 31, 2014 and 2013, certain derivative financial instruments qualified for hedge accounting (see Note 14).
(w)
Comprehensive Income
Comprehensive income for the period includes the net income for the period presented in the consolidated statement of income plus other comprehensive income for the period reflected in the consolidated statement of comprehensive income.
(x)
Stock-based Compensation
The share-based compensation expense is measured at fair value at the date the equity benefits are conditionally sold to officers and employees, and is recognized as a charge to consolidated income (administrative expense) over the vesting period (see Note 16). The Group recognized a stock-based compensation expense of Ps.844,788, Ps.605,067 and Ps.632,523 for the years ended December 31, 2014, 2013 and 2012, respectively, of which Ps.821,626, Ps.601,181 and Ps.628,637 was credited in consolidated stockholders’ equity for those years, respectively.
(y)
Leases
The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement and requires an assessment of whether the fulfillment of the arrangement is dependent on the use of a specific asset or assets and whether the arrangement conveys the right to use the asset.
Leases of property, plant and equipment other assets where the Group holds substantially all the risks and rewards of ownership are classified as finance leases. Finance lease assets are capitalized at the commencement of the lease term at the lower of the present value of the minimum lease payments or the fair value of the lease asset. The obligations relating to finance leases, net of finance charges in respect of future periods, are recognized as liabilities. The interest element of the finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under finance leases is depreciated over the shorter of the useful life of the asset and the lease term.
Leases where a significant portion of the risks and rewards are held by the lessor are classified as operating leases. Rentals are charged to the income statement on a straight line basis over the period of the lease.
Leasehold improvements are depreciated at the lesser of its useful life or contract term.
(z)
New and Amended IFRSs
Below is a list of the new and amended standards that have been issued by the IASB and are effective for annual periods starting on or after January 1, 2016. Management is in the process of assessing the potential impact of these pronouncements on the Group’s consolidated financial statements.
New or Amended Standard
|
Title of the Standard
|
Effective for Annual periods Beginning On or After
|
|
|
|
Annual Improvements
|
Annual Improvements to IFRSs 2012-2014 Cycle
|
January 1, 2016
|
Amendments to IFRS 11
|
Accounting for Acquisitions of Interests in Joint Operations
|
January 1, 2016
|
Amendments to IAS 16 and IAS 38
|
Clarification of Acceptable Methods of Depreciation and Amortization
|
January 1, 2016
|
Amendments to IAS 27
|
Equity Method in Separate Financial Statements
|
January 1, 2016
|
Amendments to IFRS 10 and IAS 28
|
Sale or Contribution of Assets between an Investor and its Associate or Joint venture
|
January 1, 2016
|
Amendments to IFRS 10, IFRS 12 and IAS 28
|
Investment Entities: Applying the Consolidation Exception
|
January 1, 2016
|
Amendments to IAS 1
|
Disclosure Initiative
|
January 1, 2016
|
IFRS 15
|
Revenue from Contracts with Customers
|
January 1, 2017
|
IFRS 9
|
Financial Instruments
|
January 1, 2018
|
Annual Improvements to IFRSs 2012-2014 Cycle were published in September 2014 and set out amendments to certain IFRSs. These amendments result from proposals made during the IASB’s Annual Improvements process, which provides a vehicle for making non-urgent but necessary amendments to IFRSs. The IFRSs amended and the topics addressed by these amendments are as follows:
Annual Improvements 2012-2014 Cycle
|
Subject of Amendment
|
|
|
IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
|
Changes in methods of disposal
|
IFRS 7 Financial Instruments Disclosures
|
Servicing contracts and applicability of the amendments to IFRS 7 to condensed interim financial statements
|
IAS 19 Employee Benefits
|
Discount rate regional market issue
|
IAS 34 Interim Financial Reporting
|
Disclosure of information 'elsewhere in the interim financial report'
|
Amendments to IFRS 11 Accounting for Acquisitions of Interests in Joint Ventures were issued in May 2014 and add new guidance on how to account for the acquisition of an interest in a joint operation in which the activity constitutes a business, as defined in IFRS 3 Business Combinations. Under these amendments, the acquirer of a joint operation that constitutes a business shall apply all of the principles on business combinations accounting in IFRS 3, and other IFRSs, that do not conflict with the guidance in this IFRS and disclose the information that is required in those IFRSs in relation to business combinations.
Amendments to IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation and Amortization were issued in May 2014 and clarify that the use of revenue-based methods to calculate depreciation of an asset is not appropriate because revenue generated by an activity that includes the use of an asset generally reflects factors other than the consumption of the economic benefits embodied in the assets. These amendments also clarify that revenue is generally presumed to be an inappropriate basis for measuring the consumption of the economic benefits embodied in an intangible asset.
Amendments to IAS 27 Equity Method in Separate Financial Statements were issued in August 2014 and will allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in the separate financial statements.
Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture were issued in September 2014 and address and acknowledged inconsistency between the requirements in IFRS 10 and those in IAS 28 (2011), in dealing with the sale or contribution of assets between an investor and its associate or joint venture. The main consequence of the amendments is that a full gain or loss is recognized when a transaction involved a business (whether it is housed in a subsidiary or not). A partial gain or loss is recognized when a transaction involve assets that do not constitute a business, even if these assets are housed in a subsidiary.
Amendments to IFRS 10, IFRS 12 and IAS 28 Investment Entities: Applying the Consolidation Exception were issued in December 2014, and introduce clarifications to the requirements when accounting for investment entities. These amendments clarify which subsidiaries of an investment entity are consolidated in accordance with IFRS 10 Consolidated Financial Statements, instead of being measured at fair value through income.
Amendments to IAS 1 Disclosure Initiative were issued in December 2014 and clarify that companies should use professional judgment in determining what information to disclose in the financial statements, and where and in what order information is presented in the financial disclosures.
IFRS 15 Revenue from Contracts with Customers (“IFRS 15”) was issued in May 2014. IFRS 15 and provides a single, comprehensive revenue recognition model for all contracts with customers to improve comparability within industries, across industries, and across capital markets. This standard contains principles that an entity will apply to determine the measurement of revenue and timing of when it is recognized. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. IFRS 15 is effective on January 1, 2017, with early adoption permitted. The Group is expected to be impacted to some extent by the significant increase in required disclosures. The Group is currently in the process of assessing the changes that are beyond disclosures, and the effect of the adoption of this standard regarding technology systems, processes, and internal controls to capture new data and address changes in financial reporting.
IFRS 9 Financial Instruments (“IFRS 9”) addresses the classification, measurement and recognition of financial assets and financial liabilities. IFRS 9 was issued in November 2009 and October 2010. It replaces the parts of IAS 39 Financial Instruments: Recognition and Measurement (“IAS 39”) that relate to the classification and measurement of financial instruments. IFRS 9 requires financial assets to be classified into two measurement categories: those measured at amortized cost and those measured at fair value. The determination is made at initial recognition. The basis of classification depends on the entity’s business model for managing its financial instruments and the contractual cash flow characteristics of the financial asset. The guidance in IAS 39 on impairment of financial assets and hedge accounting continues to apply. For financial liabilities, this standard retains most of the IAS 39 requirements. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in other comprehensive income rather than the income statement, unless this creates an accounting mismatch. Some amendments to IFRS 9 and IFRS 7 Financial Instruments: Disclosures (“IFRS 7”) were issued in December 2011. These amendments to IFRS 9 modify the mandatory effective date of this standard and the relief from restating prior periods, and also add transition disclosures to IFRS 7 that are required to be applied when IFRS 9 is first applied.
Explanation of seasonality or cyclicality of interim operations
|
See Note 16
|
Explanation of nature and amount of items affecting assets, liabilities, equity, net income or cash flows that are unusual because of their nature size or incidence
|
Not applicable
|
Explanation of nature and amount of changes in estimates of amounts reported in prior interim periods or prior financial years
|
See Note 7
|
Explanation of issues, repurchases and repayments of debt and equity securities
|
See Note 10
|
Dividends paid, ordinary shares
|
0
|
Dividends paid, other shares
|
0
|
Dividends paid, ordinary shares per share
|
0
|
Dividends paid, other shares per share
|
0
|
Explanation of events after interim period that have not been reflected
|
Not applicable
|
Explanation of effect of changes in composition of entity during interim period
|
Not applicable
|
Description of compliance with IFRSs if applied for interim financial report
|
See Note 2
|
Description of nature and amount of change in estimate during final interim period
|
Not applicable
|
Financial Statement Notes
|
[210000] Statement of financial position, current/non-current
Current assets - O
ther current non-financial assets: As of March 31, 2016 and 2015, includes transmission rights and programming for Ps.7,274,757 and Ps.5,389,133, respectively.
Non-current assets -
Other non-current non-financial assets: As of March 31, 2016 and 2015, includes transmission rights and programming for Ps.9,127,354 and Ps.9,139,149, respectively.
[310000] Statement of comprehensive income, profit or loss, by function of expense
Total basic earnings (loss) per share: This information is related to earnings per CPO. The CPOs are the securities traded in the mexican stock exchange.
Total diluted earnings (loss) per share: This information is related to earnings per diluted CPO.
[800001] Breakdown of credits
The exchange rates for the credits denominated in foreign currency were as follows:
Ps.17.2748 pesos per U.S. dollar
Liabilities of taxes are not included no include payable in foreign currency and Mexican pesos of Ps.85,970 and Ps.1,516,999, respectively.
The Notes due 2021 and 2022 were contracted at a variable rate and the Notes due 2020 was contracted at a fixed rate.
The "Senior Notes" due in 2037, 2043, 2018, 2025, 2032, 2040, 2045, 2026 and 2046 were contracted at a fixed rate.
For more information on debt see Note 8 Notes to the Consolidated Financial Statements.
Banks loans, Senior Notes and Notes are presented net of unamortized finance costs in the aggregate amount of Ps.1,362,427
.
[800003] Annex - Monetary foreign currency position
The exchange rates used for translation were as follows:
Ps.
|
17.2748
|
|
pesos per U.S. dollar
|
|
19.6656
|
|
pesos per euro
|
|
13.3184
|
|
pesos per canadian dollar
|
|
1.1792
|
|
pesos per argentinean peso
|
|
0.5419
|
|
pesos per uruguayan peso
|
|
0.0258
|
|
pesos per chilean peso
|
|
0.0058
|
|
pesos per colombian peso
|
|
5.2084
|
|
pesos per peruvian nuevo sol
|
|
17.9843
|
|
pesos per swiss franc
|
|
2.7420
|
|
pesos per strong bolivar
|
|
4.7958
|
|
pesos per brazilean real
|
|
22.8308
|
|
pesos per esterling libra
|
|
2.6791
|
|
pesos per chinese yuan
|
|
2.1284
|
|
pesos per swedish krona
|