NEW YORK, Feb. 15, 2012 /PRNewswire/ -- CBS Corporation
(NYSE: CBS.A and CBS) today reported results for the fourth quarter
and full year ended December 31,
2011.
"CBS's strategy of producing and distributing industry-leading
content around the world and across multiple platforms continues to
pay off," said Sumner Redstone, Executive Chairman, CBS
Corporation. "Our programming gets stronger every year, and our
financial performance grows more and more robust. I am proud of the
efforts of Leslie and his team, and I am certain CBS will continue
to be a powerhouse throughout this year and beyond."
"2011 was a record year for CBS, and we're confident 2012 will
be even better," said Leslie
Moonves, President and Chief Executive Officer, CBS
Corporation. "In the fourth quarter, margins continued to expand,
and EPS continued to grow. And we've recently taken strategic steps
to accelerate our growth in what we see as an improving
marketplace. We've reached another key retransmission agreement,
and we've extended our NFL contract well into the future. In
addition, the performance of the CBS Television Network in the
first half of this season was the industry's best in decades. Plus,
as the election season progresses and the automotive rebound
continues, our local businesses will continue to improve. What's
particularly exciting, however, is our ability to capitalize on the
fundamental changes in our business model, meaning that the ways we
get paid for our content are becoming more lucrative all the
time. As our momentum builds and our revenue mix becomes more
steady and recurring, we are positioned to enhance margins, drive
earnings, and return significant value to our shareholders for many
years to come."
Fourth Quarter 2011 Results
Revenues were $3.78 billion for
the fourth quarter of 2011 compared with $3.90 billion for the fourth quarter of 2010,
which included the second-cycle syndication sale of CSI: Crime
Scene Investigation and significant political advertising.
Revenues in 2011 benefited from the Company's new digital
streaming agreements and higher affiliate and subscription fees,
including retransmission revenues.
Adjusted operating income before depreciation and amortization
("OIBDA") of $837 million for the
fourth quarter of 2011 increased 9% from $771 million in the same prior-year period, with
adjusted OIBDA margin expansion of two percentage points, to 22%.
The Company's adjusted OIBDA growth and margin expansion were
driven by increases in high-margin revenues, including digital
streaming and affiliate and subscription fee revenues, as well as
lower costs associated with the timing of programming.
Adjusted operating income for the fourth quarter of 2011
increased 11% to $701 million from
$632 million for the same quarter in
2010.
Adjusted net earnings from continuing operations for the fourth
quarter of 2011 were $384 million, or
$.57 per diluted share, up from
$320 million, or $.46 per diluted share, for the prior-year
period. The increase in earnings per share ("EPS") was driven by
the Company's OIBDA growth, lower interest expense, and lower
weighted average shares outstanding, reflecting the impact of share
repurchases in 2011.
During the fourth quarter of 2011, in a continued effort to
reduce its cost structure, the Company initiated restructuring
activities, which resulted in charges totaling $46 million associated with the relocation and
closure of certain business activities and other exit costs.
Adjusted results for the fourth quarter of 2011 exclude
restructuring charges. Results for the fourth quarter of 2010 were
adjusted at that time to exclude restructuring charges of
$15 million and a pre-tax loss on
early extinguishment of debt of $43
million. Reported operating income increased 6% to
$655 million from $617 million for the same prior-year period.
Reported net earnings from continuing operations for the fourth
quarter of 2011 were $356 million, or
$.53 per diluted share, up from
$283 million, or $.41 per diluted share, for the same prior-year
period. Reconciliations of non-GAAP measures to reported results
are included at the end of this earnings release.
Full Year 2011 Results
Full year 2011 revenues of $14.25
billion increased 1% from the prior year, led by growth in
higher-margin revenues, including a 6% rise in content licensing
and distribution revenues, which were driven by new digital
streaming agreements; a 9% increase in affiliate and subscription
fee revenues; and growth in underlying advertising revenues.
Comparability of revenues for 2011 was affected by the benefits to
2010 from CBS Television Network's broadcast of Super Bowl
XLIV and significant political advertising revenues for midterm
elections, as well as the new programming agreement for the NCAA
Division I Men's Basketball Championship ("NCAA Tournament"),
which resulted in lower revenues but higher profits for 2011.
Adjusted OIBDA for 2011 was up 32% to $3.12 billion from $2.37
billion for 2010, and the adjusted OIBDA margin rose five
percentage points, to 22%. This increase was driven by the
aforementioned growth in high-margin revenues and significantly
lower sports programming costs, which resulted from the new
agreement for the NCAA Tournament and the absence of the Super
Bowl XLIV broadcast. Adjusted operating income for 2011
increased 43% to $2.58 billion from
$1.81 billion for 2010.
For the full year 2011, adjusted net earnings from continuing
operations of $1.32 billion was up
from $773 million in 2010, and
adjusted diluted EPS from continuing operations increased to
$1.94, a record for the Company, from
$1.11 per diluted share in 2010. EPS
growth was driven by the increase in OIBDA, lower interest expense,
and lower weighted average shares outstanding, reflecting the
impact of the 2011 share repurchases.
Adjusted results for 2011 exclude restructuring charges of
$46 million. Results for 2010 were
adjusted at that time to exclude a favorable settlement related to
previously disposed businesses of $90
million, restructuring charges of $81
million, a pre-tax loss on early extinguishment of debt of
$81 million, a pre-tax gain on a
disposition of $8 million, and a net
provision from discrete tax items of $8
million. Reported operating income increased 39% to
$2.53 billion from $1.82 billion. Reported net earnings from
continuing operations for 2011 were $1.29
billion, or $1.90 per diluted
share, up from $724 million, or
$1.04 per diluted share, for 2010.
Reconciliations of non-GAAP measures to reported results are
included at the end of this earnings release.
Free Cash Flow, Balance Sheet and Liquidity
During the fourth quarter of 2011, the Company made a
contribution of $200 million to
pre-fund its qualified pension plans. Consequently, free cash flow
for the fourth quarter of 2011 reflected an outflow of $44 million compared to an inflow of $40 million for the fourth quarter of 2010, which
included a pension contribution of $167
million. Free cash flow for 2010 also benefited from the
receipt of a $90 million settlement
related to previously disposed businesses. For the 2011 full year,
free cash flow, which included pension contributions of
$410 million, increased 2% to
$1.48 billion from $1.45 billion for 2010, primarily reflecting the
OIBDA increase.
The Company repurchased 7.0 million shares of CBS Corporation
Class B Common Stock during the fourth quarter of 2011 for
$170 million under its share
repurchase program, bringing repurchases for the full year to 42.2
million shares for $1.02 billion. At
December 31, 2011, the Company's cash
balance was $660 million,
$180 million higher than December 31, 2010; debt outstanding was
$5.98 billion; and there were no
credit facility borrowings.
Consolidated and Segment Results (dollars in
millions)
The tables below present the Company's revenues by segment and
type and its adjusted OIBDA and adjusted operating income by
segment for the three and twelve months ended December 31, 2011, and 2010. Reconciliations of
all non-GAAP measures to reported results are included at the end
of this earnings release.
|
|
|
|
|
|
|
Three Months
Ended
|
Twelve
Months Ended
|
|
|
|
|
|
|
December
31,
|
December
31,
|
|
|
Revenues by
Segment
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
|
|
|
Entertainment
|
$
|
1,995
|
|
$
|
2,021
|
|
$
|
7,457
|
|
$
|
7,391
|
|
|
|
|
Cable Networks
|
|
395
|
|
|
368
|
|
|
1,621
|
|
|
1,475
|
|
|
|
|
Publishing
|
|
229
|
|
|
232
|
|
|
787
|
|
|
791
|
|
|
|
|
|
|
Content Group
|
|
2,619
|
|
|
2,621
|
|
|
9,865
|
|
|
9,657
|
|
|
|
|
Local Broadcasting
|
|
721
|
|
|
821
|
|
|
2,689
|
|
|
2,782
|
|
|
|
|
Outdoor
|
|
514
|
|
|
511
|
|
|
1,894
|
|
|
1,819
|
|
|
|
|
|
|
Local Group
|
|
1,235
|
|
|
1,332
|
|
|
4,583
|
|
|
4,601
|
|
|
|
|
Eliminations
|
|
(70)
|
|
|
(52)
|
|
|
(203)
|
|
|
(198)
|
|
|
|
|
|
Total Revenues
|
$
|
3,784
|
|
$
|
3,901
|
|
$
|
14,245
|
|
$
|
14,060
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
Twelve
Months Ended
|
|
|
|
|
|
|
December
31,
|
December
31,
|
|
|
Revenues by Type
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
|
|
|
Advertising
|
$
|
2,508
|
|
$
|
2,623
|
|
$
|
9,007
|
|
$
|
9,153
|
|
|
|
|
Content licensing and
distribution
|
|
758
|
|
|
796
|
|
|
3,254
|
|
|
3,071
|
|
|
|
|
Affiliate and subscription
fees
|
|
460
|
|
|
426
|
|
|
1,744
|
|
|
1,598
|
|
|
|
|
Other
|
|
58
|
|
|
56
|
|
|
240
|
|
|
238
|
|
|
|
|
|
Total Revenues
|
$
|
3,784
|
|
$
|
3,901
|
|
$
|
14,245
|
|
$
|
14,060
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
Twelve
Months Ended
|
|
|
|
|
|
|
December
31,
|
December
31,
|
|
|
Adjusted OIBDA
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
|
|
|
Entertainment
|
$
|
318
|
|
$
|
249
|
|
$
|
1,431
|
|
$
|
894
|
|
|
|
|
Cable Networks
|
|
175
|
|
|
169
|
|
|
707
|
|
|
569
|
|
|
|
|
Publishing
|
|
28
|
|
|
20
|
|
|
92
|
|
|
72
|
|
|
|
|
|
|
Content Group
|
|
521
|
|
|
438
|
|
|
2,230
|
|
|
1,535
|
|
|
|
|
Local Broadcasting
|
|
266
|
|
|
322
|
|
|
849
|
|
|
865
|
|
|
|
|
Outdoor
|
|
131
|
|
|
101
|
|
|
346
|
|
|
289
|
|
|
|
|
|
|
Local Group
|
|
397
|
|
|
423
|
|
|
1,195
|
|
|
1,154
|
|
|
|
|
Corporate
|
|
(64)
|
|
|
(64)
|
|
|
(228)
|
|
|
(218)
|
|
|
|
|
Residual costs
|
|
(19)
|
|
|
(27)
|
|
|
(75)
|
|
|
(105)
|
|
|
|
|
Eliminations
|
|
2
|
|
|
1
|
|
|
1
|
|
|
4
|
|
|
|
|
|
Adjusted OIBDA
|
|
837
|
|
|
771
|
|
|
3,123
|
|
|
2,370
|
|
|
|
|
Other discrete items
(a)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
90
|
|
|
|
|
Restructuring charges
|
|
(46)
|
|
|
(15)
|
|
|
(46)
|
|
|
(81)
|
|
|
|
|
|
Total OIBDA
|
$
|
791
|
|
$
|
756
|
|
$
|
3,077
|
|
$
|
2,379
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
Twelve
Months Ended
|
|
|
|
|
|
|
December
31,
|
December
31,
|
|
|
Adjusted Operating Income
(Loss)
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
2010
|
|
|
|
|
Entertainment
|
$
|
275
|
|
$
|
209
|
|
$
|
1,271
|
|
$
|
731
|
|
|
|
|
Cable Networks
|
|
169
|
|
|
163
|
|
|
684
|
|
|
546
|
|
|
|
|
Publishing
|
|
27
|
|
|
18
|
|
|
85
|
|
|
65
|
|
|
|
|
|
|
Content Group
|
|
471
|
|
|
390
|
|
|
2,040
|
|
|
1,342
|
|
|
|
|
Local Broadcasting
|
|
242
|
|
|
296
|
|
|
750
|
|
|
765
|
|
|
|
|
Outdoor
|
|
76
|
|
|
42
|
|
|
111
|
|
|
40
|
|
|
|
|
|
|
Local Group
|
|
318
|
|
|
338
|
|
|
861
|
|
|
805
|
|
|
|
|
Corporate
|
|
(71)
|
|
|
(70)
|
|
|
(252)
|
|
|
(239)
|
|
|
|
|
Residual costs
|
|
(19)
|
|
|
(27)
|
|
|
(75)
|
|
|
(105)
|
|
|
|
|
Eliminations
|
|
2
|
|
|
1
|
|
|
1
|
|
|
4
|
|
|
|
|
|
Adjusted Operating
Income
|
|
701
|
|
|
632
|
|
|
2,575
|
|
|
1,807
|
|
|
|
|
Other discrete items
(a)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
90
|
|
|
|
|
Restructuring charges
|
|
(46)
|
|
|
(15)
|
|
|
(46)
|
|
|
(81)
|
|
|
|
|
|
Total Operating
Income
|
$
|
655
|
|
$
|
617
|
|
$
|
2,529
|
|
$
|
1,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) See reconciliations at the
end of this earnings release for descriptions of the components of
other discrete items.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entertainment (CBS Television Network, CBS Television
Studios, CBS Studios International, CBS Television Distribution,
CBS Films, and CBS Interactive)
Fourth Quarter
Entertainment revenues for the fourth quarter of 2011 decreased
1% to $2.00 billion from $2.02 billion for the same prior-year period. The
decrease reflects the second-cycle syndication sale of CSI:
Crime Scene Investigation during the fourth quarter of 2010. At
the same time, in 2011 the Company benefited from new multiyear
domestic and international licensing agreements for digital
streaming as well as increases in retransmission revenues.
Advertising revenues for the fourth quarter of 2011 were
essentially flat compared with the fourth quarter of 2010.
Entertainment adjusted OIBDA for the fourth quarter of 2011
increased 28% to $318 million from
$249 million, with margin improvement
of four percentage points to 16% compared with the same prior-year
period. The increase in adjusted OIBDA and strong margin expansion
were driven by growth in high-margin revenues, primarily reflecting
the impact of the aforementioned digital streaming agreements, as
well as lower costs, which were largely driven by the timing of
production and distribution expenses. Adjusted OIBDA excludes
restructuring charges of $40 million
for 2011 and $12 million for
2010.
Full Year
Entertainment revenues of $7.46
billion for 2011 increased 1% from $7.39 billion in 2010. Revenues grew despite the
benefit to 2010 from the CBS Television Network's broadcast of
Super Bowl XLIV and the impact of the new programming
agreement for the NCAA Tournament, which resulted in lower revenues
but higher profits for 2011. Revenue growth was driven by new
licensing agreements for digital streaming, growth in underlying
advertising revenues for the CBS Television Network, and higher
retransmission revenues.
Entertainment adjusted OIBDA for 2011 increased 60% to
$1.43 billion from $894 million for 2010, and the adjusted OIBDA
margin increased seven percentage points to 19%. The strong
adjusted OIBDA growth and margin expansion were driven by the
aforementioned growth in high-margin streaming and retransmission
revenues; significantly lower sports programming costs resulting
from the new agreement for the NCAA Tournament and the absence of
the Super Bowl XLIV broadcast; and lower costs primarily
driven by the timing of production and distribution expenses.
Adjusted OIBDA excludes restructuring charges of $40 million for 2011 and $23 million for 2010.
Cable Networks (Showtime Networks, CBS Sports Network,
and Smithsonian Networks)
Fourth Quarter
Cable Networks revenues for the fourth quarter of 2011 increased
7% to $395 million from $368 million for the same prior-year period. The
results were driven by rate increases and growth in subscriptions
to Showtime Networks, CBS Sports Network, and Smithsonian Networks,
as well as higher revenues from the licensing of Showtime original
series. As of December 31, 2011,
subscriptions totaled 73 million for Showtime Networks (including
Showtime, The Movie Channel, and Flix), 44 million
for CBS Sports Network, and 12 million for Smithsonian
Networks.
Cable Networks OIBDA for the fourth quarter of 2011 grew 4% to
$175 million from $169 million for the same prior-year period,
primarily reflecting revenue growth, partially offset by the timing
of advertising costs for original series premieres.
Full Year
Cable Networks revenues for 2011 increased 10% to $1.62 billion from $1.48
billion for 2010, driven by rate increases and growth in
subscriptions to Showtime Networks, CBS Sports Network, and
Smithsonian Networks, as well as higher revenues from the licensing
of Showtime original series.
Cable Networks OIBDA of $707
million for 2011 increased 24% from adjusted OIBDA of
$569 million in 2010, driven by
revenue growth and lower theatrical programming costs. The increase
was partially offset by higher advertising and programming costs
for original series. Adjusted OIBDA for 2010 excludes restructuring
charges of $3 million.
Publishing (Simon & Schuster)
Fourth Quarter
Publishing revenues for the fourth quarter of 2011 decreased 1%
to $229 million from $232 million for the same prior-year period, as
strong growth in the sale of more profitable digital content was
offset by lower print book sales. Sales of digital content
increased 83% from the 2010 fourth quarter and represented
approximately 18% of total Publishing revenues. Best-selling titles
in the fourth quarter included Steve
Jobs by Walter Isaacson
and 11/22/63 by Stephen King.
Publishing adjusted OIBDA for the fourth quarter of 2011
increased 40% to $28 million from
$20 million for the same prior-year
period. This increase was primarily driven by lower expenses
resulting from the significant increase in more profitable digital
sales as a percentage of total revenues and the absence of a
provision for doubtful accounts recorded in the fourth quarter of
2010. Adjusted OIBDA excludes restructuring charges of $2 million for both the fourth quarter of 2011
and 2010.
Full Year
Publishing revenues for 2011 decreased 1% to $787 million from $791
million for the prior year, as strong growth in the sale of
digital content, which more than doubled from 2010, was offset by
lower print book sales.
Publishing adjusted OIBDA for 2011 rose 28% to $92 million from $72
million for the prior year, reflecting lower direct
operating costs. These include the impact of cost-containment
measures, the decline in expenses resulting from an increase in
more profitable digital sales as a percentage of total revenues,
and the absence of a provision for doubtful accounts recorded in
2010. Adjusted OIBDA excludes restructuring charges of $2 million for 2011 and $4
million for 2010.
Local Broadcasting (CBS Television Stations and CBS
Radio)
Fourth Quarter
Local Broadcasting revenues for the fourth quarter of 2011
decreased 12% to $721 million from
$821 million for the same prior-year
period. The decline is entirely attributable to lower political
advertising sales as well as lost revenues resulting from the NBA
lockout during 2011. CBS Television Stations revenues decreased
18%, also reflecting lower political sales and lost NBA advertising
revenues, partially offset by higher retransmission revenues and an
improvement in auto advertising. CBS Radio revenues decreased 5%,
reflecting the decline in political spending, which was partially
offset by growth in domestic auto and financial services
advertising.
Local Broadcasting OIBDA for the fourth quarter of 2011
decreased $56 million to $266 million from $322
million for the same prior-year period. Lower programming
expenses, in part because of the NBA lockout, and the impact of
cost-containment measures overcame nearly half of the revenue
decline.
Full Year
Local Broadcasting revenues for 2011 decreased 3% to
$2.69 billion from $2.78 billion because of a difficult comparison
to 2010, which included significant political advertising sales and
revenues from the 2010 Super Bowl broadcast. CBS Television
Stations revenues decreased 7%, driven by the impact of these two
noncomparable items as well as lost revenues from the NBA lockout
during 2011. Revenues for CBS Television Stations also reflected
higher retransmission revenues and growth in domestic auto and
financial services advertising. CBS Radio revenues increased
slightly from the prior year, reflecting growth in domestic auto,
financial services, and retail advertising, partially offset by
lower political advertising sales.
Local Broadcasting OIBDA for 2011 decreased 2% to $849 million from adjusted OIBDA of $865 million for 2010, as the revenue decline was
substantially offset by lower programming and production costs for
syndicated and sports programming. Adjusted OIBDA for 2010 excludes
restructuring charges of $25
million.
Outdoor (CBS Outdoor)
Fourth Quarter
Outdoor revenues for the fourth quarter of 2011 increased 1% to
$514 million from $511 million for the same prior-year period.
Revenues for the Americas (comprising North America and South America) increased slightly in constant
dollars for the fourth quarter of 2011 from the same prior-year
period, principally reflecting rate increases in the U.S.
billboards business, partially offset by the impact from the
nonrenewal of the Toronto transit
contract. Revenues for Europe
increased 3% in constant dollars, primarily reflecting higher
revenues in the United
Kingdom.
Outdoor adjusted OIBDA for the fourth quarter of 2011 increased
30% to $131 million from $101 million for the same prior-year period,
driven by revenue growth and lower costs, resulting primarily from
the mix of more profitable contracts and the settlement of legal
matters. Adjusted OIBDA excludes restructuring charges of
$4 million for the fourth quarter of
2011 and $1 million for the same
prior-year period.
Full Year
Outdoor revenues for 2011 increased 4% to $1.89 billion from $1.82
billion in 2010, principally reflecting the improvement in
the outdoor advertising marketplace in the Americas and the
favorable impact of foreign-exchange rate changes. Revenues for the
Americas grew 4% in constant dollars, reflecting rate increases in
the U.S. billboards and displays businesses, partially offset by
the impact of the nonrenewal of the Toronto transit contract. Revenues for
Europe in 2011 decreased 2% in
constant dollars, reflecting weakness in the European economy.
Outdoor adjusted OIBDA for 2011 increased 20% to $346 million from $289
million for 2010, driven by the revenue growth and lower
costs, resulting primarily from the mix of more profitable
contracts and the settlement of legal matters. Adjusted OIBDA
excludes restructuring charges of $4
million for 2011 and $26
million for 2010.
Corporate
Corporate expenses before depreciation of $64 million for the fourth quarter of 2011
remained flat compared with the same prior-year period. For the
full year, corporate expenses increased $10
million to $228 million,
primarily driven by higher incentive compensation associated with
the Company's improved operating results.
Residual Costs
Residual costs include pension and postretirement benefits costs
for plans retained by the Company for previously divested
businesses. For the fourth quarter of 2011, residual costs
decreased $8 million to $19 million compared with the same prior-year
period. For the full year, residual costs decreased $30 million to $75
million from adjusted residual costs of $105 million for 2010. For each period, the
decrease primarily reflected the favorable performance of pension
plan assets in 2010 as well as the benefit from the pre-funding of
pension plans at the end of 2010. Adjusted residual costs for the
full year 2010 exclude a settlement of $90
million related to the favorable resolution of certain
disputes regarding previously disposed businesses.
Discontinued Operations
During the fourth quarter of 2011, the Company reached favorable
resolutions of certain contingencies related to its previously
disposed businesses, which are accounted for as discontinued
operations. As a result, a pre-tax gain of $23 million ($14
million, net of tax) was recorded in discontinued
operations.
About CBS Corporation
CBS Corporation is a mass media company with constituent parts
that reach back to the beginnings of the broadcast industry, as
well as newer businesses that operate on the leading edge of the
media industry. The Company, through its many and varied
operations, combines broad reach with well-positioned local
businesses, all of which provide it with an extensive distribution
network by which it serves audiences and advertisers in all 50
states and key international markets. It has operations in
virtually every field of media and entertainment, including
broadcast television (CBS and The CW – a joint venture between CBS
Corporation and Warner Bros. Entertainment), cable television
(Showtime Networks, Smithsonian Networks and CBS Sports Network),
local television (CBS Television Stations), television production
and syndication (CBS Television Studios, CBS Studios International
and CBS Television Distribution), radio (CBS Radio), advertising on
out-of-home media (CBS Outdoor), publishing (Simon & Schuster),
interactive media (CBS Interactive), licensing and merchandising
(CBS Consumer Products), video/DVD (CBS Home Entertainment), motion
pictures (CBS Films), and socially responsible media (EcoMedia).
For more information, log on to www.cbscorporation.com.
Cautionary Statement Concerning Forward-looking
Statements
This news release contains both historical and forward-looking
statements. All statements other than statements of historical fact
are, or may be deemed to be, forward-looking statements within the
meaning of section 27A of the Securities Act of 1933 and section
21E of the Securities Exchange Act of 1934. These forward-looking
statements are not based on historical facts, but rather reflect
the Company's current expectations concerning future results and
events. Similarly, statements that describe our objectives, plans
or goals are or may be forward-looking statements. These
forward-looking statements involve known and unknown risks,
uncertainties and other factors that are difficult to predict and
which may cause the actual results, performance or achievements of
the Company to be different from any future results, performance or
achievements expressed or implied by these statements. These risks,
uncertainties and other factors include, among others: advertising
market conditions generally; changes in the public acceptance of
the Company's programming; changes in technology and its effect on
competition in the Company's markets; changes in the Federal
Communications laws and regulations; the impact of piracy on the
Company's products; the impact of the consolidation in the market
for the Company's programming; other domestic and global economic,
business, competitive and/or other regulatory factors affecting the
Company's businesses generally; the impact of union activity,
including possible strikes or work stoppages or the Company's
inability to negotiate favorable terms for contract renewals; and
other factors described in the Company's news releases and filings
with the Securities and Exchange Commission including but not
limited to the Company's most recent Form 10-K, Form 10-Qs and Form
8-Ks. The forward-looking statements included in this document are
made only as of the date of this document, and under section 27A of
the Securities Act and section 21E of the Exchange Act, we do not
have any obligation to publicly update any forward-looking
statements to reflect subsequent events or circumstances.
|
|
CBS CORPORATION AND
SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
(Unaudited; in millions, except
per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve
Months Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
2011
|
|
|
|
2010
|
|
|
|
2011
|
|
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$
|
3,784
|
|
|
$
|
3,901
|
|
|
$
|
14,245
|
|
|
$
|
14,060
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
655
|
|
|
|
617
|
|
|
|
2,529
|
|
|
|
1,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
(106)
|
|
|
|
(130)
|
|
|
|
(436)
|
|
|
|
(529)
|
|
|
|
Interest income
|
|
2
|
|
|
|
2
|
|
|
|
7
|
|
|
|
6
|
|
|
|
Loss on early extinguishment of
debt
|
|
—
|
|
|
|
(43)
|
|
|
|
—
|
|
|
|
(81)
|
|
|
|
Other items, net
|
|
(10)
|
|
|
|
13
|
|
|
|
(17)
|
|
|
|
10
|
|
|
Earnings before income
taxes
|
|
541
|
|
|
|
459
|
|
|
|
2,083
|
|
|
|
1,222
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
(186)
|
|
|
|
(172)
|
|
|
|
(755)
|
|
|
|
(463)
|
|
|
|
Equity in earnings (loss) of
investee companies, net of tax
|
|
1
|
|
|
|
(4)
|
|
|
|
(37)
|
|
|
|
(35)
|
|
|
Net earnings from continuing
operations
|
|
356
|
|
|
|
283
|
|
|
|
1,291
|
|
|
|
724
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings from discontinued
operations
|
|
14
|
|
|
|
—
|
|
|
|
14
|
|
|
|
—
|
|
|
Net earnings
|
$
|
370
|
|
|
$
|
283
|
|
|
$
|
1,305
|
|
|
$
|
724
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net earnings per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings from continuing
operations
|
$
|
.55
|
|
|
$
|
.42
|
|
|
$
|
1.94
|
|
|
$
|
1.07
|
|
|
|
Net earnings from discontinued
operations
|
$
|
.02
|
|
|
$
|
—
|
|
|
$
|
.02
|
|
|
$
|
—
|
|
|
|
Net earnings
|
$
|
.57
|
|
|
$
|
.42
|
|
|
$
|
1.97
|
|
|
$
|
1.07
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net earnings per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings from continuing
operations
|
$
|
.53
|
|
|
$
|
.41
|
|
|
$
|
1.90
|
|
|
$
|
1.04
|
|
|
|
Net earnings from discontinued
operations
|
$
|
.02
|
|
|
$
|
—
|
|
|
$
|
.02
|
|
|
$
|
—
|
|
|
|
Net earnings
|
$
|
.55
|
|
|
$
|
.41
|
|
|
$
|
1.92
|
|
|
$
|
1.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
653
|
|
|
|
680
|
|
|
|
664
|
|
|
|
679
|
|
|
|
Diluted
|
|
669
|
|
|
|
698
|
|
|
|
681
|
|
|
|
694
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per common
share
|
$
|
.10
|
|
|
$
|
.05
|
|
|
$
|
.35
|
|
|
$
|
.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND
SUBSIDIARIES
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
(Unaudited; in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
|
At
|
|
|
|
|
December 31,
2011
|
|
December 31,
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
660
|
|
|
$
|
480
|
|
|
|
Receivables, net
|
|
3,254
|
|
|
|
3,248
|
|
|
|
Programming and other
inventory
|
|
735
|
|
|
|
751
|
|
|
|
Prepaid expenses and other
current assets
|
|
894
|
|
|
|
916
|
|
|
|
|
|
Total current assets
|
|
5,543
|
|
|
|
5,395
|
|
|
|
Property and
equipment
|
|
5,334
|
|
|
|
5,320
|
|
|
|
|
Less accumulated depreciation
and amortization
|
|
2,824
|
|
|
|
2,626
|
|
|
|
|
|
Net property and
equipment
|
|
2,510
|
|
|
|
2,694
|
|
|
|
Programming and other
inventory
|
|
1,496
|
|
|
|
1,365
|
|
|
|
Goodwill
|
|
8,620
|
|
|
|
8,524
|
|
|
|
Intangible assets
|
|
6,526
|
|
|
|
6,624
|
|
|
|
Other assets
|
|
1,502
|
|
|
|
1,541
|
|
|
|
Total Assets
|
$
|
26,197
|
|
|
$
|
26,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
$
|
410
|
|
|
$
|
439
|
|
|
|
Participants' share and
royalties payable
|
|
938
|
|
|
|
943
|
|
|
|
Program rights
|
|
577
|
|
|
|
601
|
|
|
|
Current portion of long-term
debt
|
|
24
|
|
|
|
27
|
|
|
|
Accrued expenses and other
current liabilities
|
|
1,984
|
|
|
|
2,016
|
|
|
|
|
|
Total current
liabilities
|
|
3,933
|
|
|
|
4,026
|
|
|
|
Long-term debt
|
|
5,958
|
|
|
|
5,973
|
|
|
|
Other liabilities
|
|
6,398
|
|
|
|
6,323
|
|
|
|
Total Stockholders'
Equity
|
|
9,908
|
|
|
|
9,821
|
|
|
|
Total Liabilities and
Stockholders' Equity
|
$
|
26,197
|
|
|
$
|
26,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND
SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF CASH
FLOWS
|
|
(Unaudited; in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended
|
|
|
|
December
31,
|
|
|
|
|
2011
|
|
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
Net earnings
|
$
|
1,305
|
|
|
$
|
724
|
|
|
Less: Net earnings from
discontinued operations
|
|
14
|
|
|
|
—
|
|
|
Net earnings from continuing
operations
|
|
1,291
|
|
|
|
724
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net
earnings from continuing operations to net cash flow
|
|
|
|
|
|
|
|
|
|
provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
548
|
|
|
|
563
|
|
|
|
Stock-based
compensation
|
|
140
|
|
|
|
136
|
|
|
|
Loss on early extinguishment of
debt
|
|
—
|
|
|
|
81
|
|
|
|
Equity in loss of investee
companies, net of tax and distributions
|
|
50
|
|
|
|
35
|
|
|
|
Change in assets and
liabilities, net of effects of acquisitions
|
|
(280)
|
|
|
|
196
|
|
|
Net cash flow provided by
operating activities
|
|
1,749
|
|
|
|
1,735
|
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
|
Acquisitions, net of cash
acquired
|
|
(75)
|
|
|
|
(11)
|
|
|
|
Capital expenditures
|
|
(265)
|
|
|
|
(284)
|
|
|
|
Investments in and advances to
investee companies
|
|
(79)
|
|
|
|
(90)
|
|
|
|
Proceeds from
dispositions
|
|
22
|
|
|
|
18
|
|
|
|
Other investing
activities
|
|
8
|
|
|
|
(1)
|
|
|
Net cash flow used for investing
activities
|
|
(389)
|
|
|
|
(368)
|
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of
notes
|
|
—
|
|
|
|
1,094
|
|
|
|
Repayment of notes and
debentures
|
|
—
|
|
|
|
(2,126)
|
|
|
|
Payment of capital lease
obligations
|
|
(19)
|
|
|
|
(16)
|
|
|
|
Dividends
|
|
(206)
|
|
|
|
(142)
|
|
|
|
Purchase of Company common
stock
|
|
(1,012)
|
|
|
|
—
|
|
|
|
Payment of payroll taxes in lieu
of issuing shares for stock-based compensation
|
|
(82)
|
|
|
|
(37)
|
|
|
|
Proceeds from exercise of stock
options
|
|
72
|
|
|
|
7
|
|
|
|
Excess tax benefit from
stock-based compensation
|
|
72
|
|
|
|
16
|
|
|
|
Decrease to accounts receivable
securitization program
|
|
—
|
|
|
|
(400)
|
|
|
|
Other financing
activities
|
|
(5)
|
|
|
|
—
|
|
|
Net cash flow used for financing
activities
|
|
(1,180)
|
|
|
|
(1,604)
|
|
|
Net increase (decrease) in cash
and cash equivalents
|
|
180
|
|
|
|
(237)
|
|
|
Cash and cash equivalents at
beginning of year
|
|
480
|
|
|
|
717
|
|
|
Cash and cash equivalents at end
of year
|
$
|
660
|
|
|
$
|
480
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL
INFORMATION
(Unaudited; in millions)
Operating Income (Loss) Before Depreciation and Amortization
("OIBDA"), Adjusted OIBDA, and Adjusted Operating Income (Loss)
The following tables set forth the Company's OIBDA, adjusted
OIBDA and adjusted operating income (loss) for the three and twelve
months ended December 31, 2011 and
2010. The Company defines OIBDA as net earnings (loss) adjusted to
exclude the following line items presented in its Consolidated
Statements of Operations: Net earnings from discontinued
operations; Equity in earnings (loss) of investee companies, net of
tax; Provision for income taxes; Other items, net; Loss on early
extinguishment of debt; Interest income; Interest expense; and
Depreciation and amortization. The Company defines "Adjusted OIBDA"
as OIBDA before restructuring charges and the settlement of certain
disputes regarding previously disposed businesses and "Adjusted
Operating Income" as Operating Income (Loss) before restructuring
charges and the settlement of certain disputes regarding previously
disposed businesses.
The Company uses OIBDA, Adjusted OIBDA and Adjusted Operating
Income, as well as OIBDA, Adjusted OIBDA and Adjusted Operating
Income margins, among other things, to evaluate the Company's
operating performance, to value prospective acquisitions and as one
of several components of incentive compensation targets for certain
management personnel, and these measures are among the primary
measures used by management for planning and forecasting of future
periods. These measures are important indicators of the Company's
operational strength and performance of its business because they
provide a link between profitability and operating cash flow. The
Company believes the presentation of these measures is relevant and
useful for investors because they allow investors to view
performance in a manner similar to the method used by the Company's
management, help improve their ability to understand the Company's
operating performance and make it easier to compare the Company's
results with other companies that have different financing and
capital structures or tax rates. In addition, these measures are
among the primary measures used externally by the Company's
investors, analysts and peers in its industry for purposes of
valuation and comparing the operating performance of the Company to
other companies in its industry.
Since OIBDA, Adjusted OIBDA and Adjusted Operating Income are
not measures of performance calculated in accordance with
accounting principles generally accepted in the United States ("GAAP"), they should not be
considered in isolation of, or as a substitute for, net earnings
(loss) as an indicator of operating performance. OIBDA, as the
Company calculates it, may not be comparable to similarly titled
measures employed by other companies. In addition, this measure
does not necessarily represent funds available for discretionary
use, and is not necessarily a measure of the Company's ability to
fund its cash needs. As OIBDA, Adjusted OIBDA and Adjusted
Operating Income exclude certain financial information compared
with net earnings (loss), the most directly comparable GAAP
financial measure, users of this financial information should
consider the types of events and transactions which are excluded.
The Company provides the following reconciliations of OIBDA and
Adjusted OIBDA to net earnings (loss), and Adjusted OIBDA and
Adjusted Operating Income for each segment to such segment's
operating income (loss), the most directly comparable amounts
reported under GAAP.
CBS CORPORATION AND
SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES
REGARDING NON-GAAP FINANCIAL INFORMATION (continued)
(Unaudited; in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
Depreciation
|
Operating
|
|
Restructuring
|
Operating
|
|
|
|
|
OIBDA
|
and
Amortization
|
Income/(Loss)
|
|
Charges
|
Income/(Loss)
|
|
Entertainment
|
$
|
318
|
|
$
|
(43)
|
|
$
|
275
|
|
$
|
(40)
|
|
$
|
235
|
|
Cable Networks
|
|
175
|
|
|
(6)
|
|
|
169
|
|
|
—
|
|
|
169
|
|
Publishing
|
|
28
|
|
|
(1)
|
|
|
27
|
|
|
(2)
|
|
|
25
|
|
|
|
Content Group
|
|
521
|
|
|
(50)
|
|
|
471
|
|
|
(42)
|
|
|
429
|
|
Local Broadcasting
|
|
266
|
|
|
(24)
|
|
|
242
|
|
|
—
|
|
|
242
|
|
Outdoor
|
|
131
|
|
|
(55)
|
|
|
76
|
|
|
(4)
|
|
|
72
|
|
|
|
Local Group
|
|
397
|
|
|
(79)
|
|
|
318
|
|
|
(4)
|
|
|
314
|
|
Corporate
|
|
(64)
|
|
|
(7)
|
|
|
(71)
|
|
|
—
|
|
|
(71)
|
|
Residual Costs
|
|
(19)
|
|
|
—
|
|
|
(19)
|
|
|
—
|
|
|
(19)
|
|
Eliminations
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
Total
|
$
|
837
|
|
$
|
(136)
|
|
$
|
701
|
|
$
|
(46)
|
|
$
|
655
|
|
|
Margins (a)
|
|
22%
|
|
|
|
|
|
19%
|
|
|
|
|
|
17%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
Depreciation
|
Operating
|
|
Restructuring
|
Operating
|
|
|
|
|
OIBDA
|
and
Amortization
|
Income/(Loss)
|
|
Charges
|
Income/(Loss)
|
|
Entertainment
|
$
|
249
|
|
$
|
(40)
|
|
$
|
209
|
|
$
|
(12)
|
|
$
|
197
|
|
Cable Networks
|
|
169
|
|
|
(6)
|
|
|
163
|
|
|
—
|
|
|
163
|
|
Publishing
|
|
20
|
|
|
(2)
|
|
|
18
|
|
|
(2)
|
|
|
16
|
|
|
|
Content Group
|
|
438
|
|
|
(48)
|
|
|
390
|
|
|
(14)
|
|
|
376
|
|
Local Broadcasting
|
|
322
|
|
|
(26)
|
|
|
296
|
|
|
—
|
|
|
296
|
|
Outdoor
|
|
101
|
|
|
(59)
|
|
|
42
|
|
|
(1)
|
|
|
41
|
|
|
|
Local Group
|
|
423
|
|
|
(85)
|
|
|
338
|
|
|
(1)
|
|
|
337
|
|
Corporate
|
|
(64)
|
|
|
(6)
|
|
|
(70)
|
|
|
—
|
|
|
(70)
|
|
Residual Costs
|
|
(27)
|
|
|
—
|
|
|
(27)
|
|
|
—
|
|
|
(27)
|
|
Eliminations
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
Total
|
$
|
771
|
|
$
|
(139)
|
|
$
|
632
|
|
$
|
(15)
|
|
$
|
617
|
|
|
Margins (a)
|
|
20%
|
|
|
|
|
|
16%
|
|
|
|
|
|
16%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
|
|
|
|
2011
|
|
|
2010
|
|
|
Adjusted OIBDA
|
$
|
837
|
|
$
|
771
|
|
|
|
|
Restructuring charges
|
|
(46)
|
|
|
(15)
|
|
|
Total OIBDA
|
|
791
|
|
|
756
|
|
|
|
|
Depreciation and
amortization
|
|
(136)
|
|
|
(139)
|
|
|
Operating income
|
|
655
|
|
|
617
|
|
|
|
|
Interest expense
|
|
(106)
|
|
|
(130)
|
|
|
|
|
Interest income
|
|
2
|
|
|
2
|
|
|
|
|
Loss on early extinguishment of
debt
|
|
—
|
|
|
(43)
|
|
|
|
|
Other items, net
|
|
(10)
|
|
|
13
|
|
|
Earnings before income
taxes
|
|
541
|
|
|
459
|
|
|
|
|
Provision for income
taxes
|
|
(186)
|
|
|
(172)
|
|
|
|
|
Equity in earnings (loss) of
investee companies, net of tax
|
|
1
|
|
|
(4)
|
|
|
Net earnings from continuing
operations
|
|
356
|
|
|
283
|
|
|
Net earnings from discontinued
operations
|
|
14
|
|
|
—
|
|
|
Net earnings
|
$
|
370
|
|
$
|
283
|
|
|
|
|
(a) Margin is defined as
adjusted OIBDA, operating income, or adjusted operating income, as
applicable, divided by revenues.
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND
SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES
REGARDING NON-GAAP FINANCIAL INFORMATION (continued)
(Unaudited; in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
Depreciation
|
Operating
|
Other
|
Restructuring
|
Operating
|
|
|
|
|
OIBDA
|
and
Amortization
|
Income/(Loss)
|
Discrete
Items
|
Charges
|
Income/(Loss)
|
|
Entertainment
|
$
|
1,431
|
|
$
|
(160)
|
|
$
|
1,271
|
|
$
|
—
|
|
$
|
(40)
|
|
$
|
1,231
|
|
Cable Networks
|
|
707
|
|
|
(23)
|
|
|
684
|
|
|
—
|
|
|
—
|
|
|
684
|
|
Publishing
|
|
92
|
|
|
(7)
|
|
|
85
|
|
|
—
|
|
|
(2)
|
|
|
83
|
|
|
|
Content Group
|
|
2,230
|
|
|
(190)
|
|
|
2,040
|
|
|
—
|
|
|
(42)
|
|
|
1,998
|
|
Local Broadcasting
|
|
849
|
|
|
(99)
|
|
|
750
|
|
|
—
|
|
|
—
|
|
|
750
|
|
Outdoor
|
|
346
|
|
|
(235)
|
|
|
111
|
|
|
—
|
|
|
(4)
|
|
|
107
|
|
|
|
Local Group
|
|
1,195
|
|
|
(334)
|
|
|
861
|
|
|
—
|
|
|
(4)
|
|
|
857
|
|
Corporate
|
|
(228)
|
|
|
(24)
|
|
|
(252)
|
|
|
—
|
|
|
—
|
|
|
(252)
|
|
Residual Costs
|
|
(75)
|
|
|
—
|
|
|
(75)
|
|
|
—
|
|
|
—
|
|
|
(75)
|
|
Eliminations
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
Total
|
$
|
3,123
|
|
$
|
(548)
|
|
$
|
2,575
|
|
$
|
—
|
|
$
|
(46)
|
|
$
|
2,529
|
|
|
Margins (a)
|
|
22%
|
|
|
|
|
|
18%
|
|
|
|
|
|
|
|
|
18%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
|
Depreciation
|
Operating
|
Other
|
Restructuring
|
Operating
|
|
|
|
|
OIBDA
|
and
Amortization
|
Income/(Loss)
|
Discrete
Items
|
Charges
|
Income/(Loss)
|
|
Entertainment
|
$
|
894
|
|
$
|
(163)
|
|
$
|
731
|
|
$
|
—
|
|
$
|
(23)
|
|
$
|
708
|
|
Cable Networks
|
|
569
|
|
|
(23)
|
|
|
546
|
|
|
—
|
|
|
(3)
|
|
|
543
|
|
Publishing
|
|
72
|
|
|
(7)
|
|
|
65
|
|
|
—
|
|
|
(4)
|
|
|
61
|
|
|
|
Content Group
|
|
1,535
|
|
|
(193)
|
|
|
1,342
|
|
|
—
|
|
|
(30)
|
|
|
1,312
|
|
Local Broadcasting
|
|
865
|
|
|
(100)
|
|
|
765
|
|
|
—
|
|
|
(25)
|
|
|
740
|
|
Outdoor
|
|
289
|
|
|
(249)
|
|
|
40
|
|
|
—
|
|
|
(26)
|
|
|
14
|
|
|
|
Local Group
|
|
1,154
|
|
|
(349)
|
|
|
805
|
|
|
—
|
|
|
(51)
|
|
|
754
|
|
Corporate
|
|
(218)
|
|
|
(21)
|
|
|
(239)
|
|
|
—
|
|
|
—
|
|
|
(239)
|
|
Residual Costs
|
|
(105)
|
|
|
—
|
|
|
(105)
|
|
|
90
|
|
|
—
|
|
|
(15)
|
|
Eliminations
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
Total
|
$
|
2,370
|
|
$
|
(563)
|
|
$
|
1,807
|
|
$
|
90
|
|
$
|
(81)
|
|
$
|
1,816
|
|
|
Margins (a)
|
|
17%
|
|
|
|
|
|
13%
|
|
|
|
|
|
|
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31,
|
|
|
|
|
|
2011
|
|
|
2010
|
|
|
Adjusted OIBDA
|
$
|
3,123
|
|
$
|
2,370
|
|
|
|
|
Other discrete items
|
|
—
|
|
|
90
|
|
|
|
|
Restructuring charges
|
|
(46)
|
|
|
(81)
|
|
|
Total OIBDA
|
|
3,077
|
|
|
2,379
|
|
|
|
|
Depreciation and
amortization
|
|
(548)
|
|
|
(563)
|
|
|
Operating income
|
|
2,529
|
|
|
1,816
|
|
|
|
|
Interest expense
|
|
(436)
|
|
|
(529)
|
|
|
|
|
Interest income
|
|
7
|
|
|
6
|
|
|
|
|
Loss on early extinguishment of
debt
|
|
—
|
|
|
(81)
|
|
|
|
|
Other items, net
|
|
(17)
|
|
|
10
|
|
|
Earnings before income
taxes
|
|
2,083
|
|
|
1,222
|
|
|
|
|
Provision for income
taxes
|
|
(755)
|
|
|
(463)
|
|
|
|
|
Equity in loss of investee
companies, net of tax
|
|
(37)
|
|
|
(35)
|
|
|
Net earnings from continuing
operations
|
|
1,291
|
|
|
724
|
|
|
Net earnings from discontinued
operations
|
|
14
|
|
|
—
|
|
|
Net earnings
|
$
|
1,305
|
|
$
|
724
|
|
|
|
|
(a) Margin is defined as
adjusted OIBDA, operating income, or adjusted operating income, as
applicable, divided by revenues.
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL
INFORMATION (continued)
(Unaudited; in millions)
Free Cash Flow
Free cash flow reflects the Company's net cash flow provided by
(used for) operating activities less capital expenditures.
The Company's calculation of free cash flow includes capital
expenditures since investment in capital expenditures is a use of
cash that is directly related to the Company's operations. The
Company's net cash flow provided by (used for) operating activities
is the most directly comparable GAAP financial measure.
Management believes free cash flow provides investors with an
important perspective on the cash available to the Company to
service debt, make strategic acquisitions and investments, maintain
its capital assets, satisfy its tax obligations and fund ongoing
operations and working capital needs. As a result, free cash
flow is a significant measure of the Company's ability to generate
long-term value. It is useful for investors to know whether
this ability is being enhanced or degraded as a result of the
Company's operating performance. The Company believes the
presentation of free cash flow is relevant and useful for investors
because it allows investors to evaluate the cash generated from the
Company's underlying operations in a manner similar to the method
used by management. Free cash flow is one of several
components of incentive compensation targets for certain management
personnel. In addition, free cash flow is a primary measure
used externally by the Company's investors, analysts and peers in
its industry for purposes of valuation and comparing the operating
performance of the Company to other companies in its industry.
As free cash flow is not a measure calculated in accordance with
GAAP, free cash flow should not be considered in isolation of, or
as a substitute for, either net cash flow provided by (used for)
operating activities as a measure of liquidity or net earnings
(loss) as a measure of operating performance. Free cash flow,
as the Company calculates it, may not be comparable to similarly
titled measures employed by other companies. In addition,
free cash flow as a measure of liquidity has certain limitations,
and does not necessarily represent funds available for
discretionary use and is not necessarily a measure of the Company's
ability to fund its cash needs. When comparing free cash flow
to net cash flow provided by (used for) operating activities, the
most directly comparable GAAP financial measure, users of this
financial information should consider the types of events and
transactions which are not reflected in free cash flow.
The following table presents a reconciliation of the Company's
net cash flow provided by operating activities to free cash
flow:
|
|
|
|
|
Three Months
Ended
|
|
Twelve
Months Ended
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
|
2011
|
|
|
|
2010
|
|
|
|
2011
|
|
|
|
2010
|
|
|
Net cash flow provided by
operating activities
|
$
|
69
|
|
|
$
|
161
|
|
|
$
|
1,749
|
|
|
$
|
1,735
|
|
|
Capital expenditures
|
|
(113)
|
|
|
|
(121)
|
|
|
|
(265)
|
|
|
|
(284)
|
|
|
Free cash flow
|
$
|
(44)
|
|
|
$
|
40
|
|
|
$
|
1,484
|
|
|
$
|
1,451
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents a
summary of the Company's cash flows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve
Months Ended
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
|
2011
|
|
|
|
2010
|
|
|
|
2011
|
|
|
|
2010
|
|
|
Net cash flow provided by
operating activities
|
$
|
69
|
|
|
$
|
161
|
|
|
$
|
1,749
|
|
|
$
|
1,735
|
|
|
Net cash flow used for investing
activities
|
$
|
(140)
|
|
|
$
|
(168)
|
|
|
$
|
(389)
|
|
|
$
|
(368)
|
|
|
Net cash flow used for financing
activities
|
$
|
(216)
|
|
|
$
|
(585)
|
|
|
$
|
(1,180)
|
|
|
$
|
(1,604)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND
SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES
REGARDING NON-GAAP FINANCIAL INFORMATION (continued)
(Unaudited; in millions, except
per share amounts)
2011 and 2010 Adjusted
Results
The following tables reconcile
adjusted financial results to the reported results included in this
earnings release. The Company believes that adjusting its financial
results for the impact of these items is relevant and useful for
investors because it allows investors to view performance in a
manner similar to the method used by the Company's management,
provides a clearer perspective on the current underlying
performance of the Company, and adjusting each period’s results on
the same basis makes it easier to compare the Company's
year-over-year results.
|
|
|
|
|
|
|
|
Three Months
Ended December 31, 2011
|
|
|
|
|
|
2011
|
|
Restructuring
|
|
Other
Discrete
|
|
2011
|
|
|
|
|
|
|
Reported
|
|
|
Charges
(a)
|
|
|
Items
|
|
|
Adjusted
|
|
|
|
Revenues
|
$
|
3,784
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
3,784
|
|
|
|
OIBDA
|
|
791
|
|
|
46
|
|
|
—
|
|
|
|
837
|
|
|
|
OIBDA margin (b)
|
|
21%
|
|
|
|
|
|
|
|
|
|
22%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
655
|
|
|
46
|
|
|
—
|
|
|
|
701
|
|
|
|
Interest expense
|
|
(106)
|
|
|
—
|
|
|
—
|
|
|
|
(106)
|
|
|
|
Interest income
|
|
2
|
|
|
—
|
|
|
—
|
|
|
|
2
|
|
|
|
Other items, net
|
|
(10)
|
|
|
—
|
|
|
—
|
|
|
|
(10)
|
|
|
|
Earnings before income
taxes
|
|
541
|
|
|
46
|
|
|
—
|
|
|
|
587
|
|
|
|
Provision for income
taxes
|
|
(186)
|
|
|
(18)
|
|
|
—
|
|
|
|
(204)
|
|
|
|
Effective income tax
rate
|
|
34%
|
|
|
|
|
|
|
|
|
|
35%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of investee
companies, net of tax
|
|
1
|
|
|
—
|
|
|
—
|
|
|
|
1
|
|
|
|
Net earnings from continuing
operations
|
$
|
356
|
|
$
|
28
|
|
$
|
—
|
|
|
$
|
384
|
|
|
|
Diluted EPS from continuing
operations
|
$
|
.53
|
|
$
|
.04
|
|
$
|
—
|
|
|
$
|
.57
|
|
|
|
Diluted weighted average number
of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
common shares
outstanding
|
|
669
|
|
|
|
|
|
|
|
|
|
669
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31, 2010
|
|
|
|
|
|
2010
|
|
Restructuring
|
|
Other
Discrete
|
|
2010
|
|
|
|
|
|
|
Reported
|
|
|
Charges
(c)
|
|
|
Items
(d)
|
|
|
Adjusted
|
|
|
|
Revenues
|
$
|
3,901
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
3,901
|
|
|
|
OIBDA
|
|
756
|
|
|
15
|
|
|
—
|
|
|
|
771
|
|
|
|
OIBDA margin (b)
|
|
19%
|
|
|
|
|
|
|
|
|
|
20%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
617
|
|
|
15
|
|
|
—
|
|
|
|
632
|
|
|
|
Interest expense
|
|
(130)
|
|
|
—
|
|
|
—
|
|
|
|
(130)
|
|
|
|
Interest income
|
|
2
|
|
|
—
|
|
|
—
|
|
|
|
2
|
|
|
|
Loss on early extinguishment of
debt
|
|
(43)
|
|
|
—
|
|
|
43
|
|
|
|
—
|
|
|
|
Other items, net
|
|
13
|
|
|
—
|
|
|
—
|
|
|
|
13
|
|
|
|
Earnings before income
taxes
|
|
459
|
|
|
15
|
|
|
43
|
|
|
|
517
|
|
|
|
Provision for income
taxes
|
|
(172)
|
|
|
(6)
|
|
|
(15)
|
|
|
|
(193)
|
|
|
|
Effective income tax
rate
|
|
37%
|
|
|
|
|
|
|
|
|
|
37%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in loss of investee companies, net of tax
|
|
(4)
|
|
|
—
|
|
|
—
|
|
|
|
(4)
|
|
|
|
Net earnings from continuing
operations
|
$
|
283
|
|
$
|
9
|
|
$
|
28
|
|
|
$
|
320
|
|
|
|
Diluted EPS from continuing
operations
|
$
|
.41
|
|
$
|
.01
|
|
$
|
.04
|
|
|
$
|
.46
|
|
|
|
Diluted weighted average number
of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
common shares
outstanding
|
|
698
|
|
|
|
|
|
|
|
|
|
698
|
|
|
|
|
(a) Restructuring
charges at Entertainment, Publishing and Outdoor primarily
associated with the relocation and closure of certain business
activities and other exit costs.
(b) OIBDA margin is
defined as OIBDA or adjusted OIBDA divided by revenues.
(c) Restructuring
charges at Entertainment, Publishing and Outdoor reflecting
severance costs associated with the elimination of positions and
contract terminations.
(d) Reflects a
pre-tax loss on early extinguishment of debt of $43
million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBS CORPORATION AND
SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES
REGARDING NON-GAAP FINANCIAL INFORMATION (continued)
(Unaudited; in millions, except
per share amounts)
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31, 2011
|
|
|
|
|
|
2011
|
|
Restructuring
|
|
Other
Discrete
|
Tax
|
|
2011
|
|
|
|
|
|
|
Reported
|
|
|
Charges
(a)
|
|
|
Items
|
|
Items
|
|
Adjusted
|
|
|
|
Revenues
|
$
|
14,245
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
14,245
|
|
|
|
OIBDA
|
|
3,077
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
3,123
|
|
|
|
OIBDA margin (b)
|
|
22%
|
|
|
|
|
|
|
|
|
|
|
|
22%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
2,529
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
2,575
|
|
|
|
Interest expense
|
|
(436)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(436)
|
|
|
|
Interest income
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
|
Other items, net
|
|
(17)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17)
|
|
|
|
Earnings before income
taxes
|
|
2,083
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
2,129
|
|
|
|
Provision for income
taxes
|
|
(755)
|
|
|
(18)
|
|
|
—
|
|
|
—
|
|
|
(773)
|
|
|
|
Effective income tax
rate
|
|
36%
|
|
|
|
|
|
|
|
|
|
|
|
36%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in loss of investee
companies, net of tax
|
|
(37)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(37)
|
|
|
|
Net earnings from continuing
operations
|
$
|
1,291
|
|
$
|
28
|
|
$
|
—
|
|
$
|
—
|
|
$
|
1,319
|
|
|
|
Diluted EPS from continuing
operations
|
$
|
1.90
|
|
$
|
.04
|
|
$
|
—
|
|
$
|
—
|
|
$
|
1.94
|
|
|
|
Diluted weighted average number
of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
common shares
outstanding
|
|
681
|
|
|
|
|
|
|
|
|
|
|
|
681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31, 2010
|
|
|
|
|
|
2010
|
|
Restructuring
|
|
Other
Discrete
|
Tax
|
|
2010
|
|
|
|
|
|
|
Reported
|
|
|
Charges
(c)
|
|
|
Items
(d)
|
|
Items
(e)
|
|
Adjusted
|
|
|
|
Revenues
|
$
|
14,060
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
14,060
|
|
|
|
OIBDA
|
|
2,379
|
|
|
81
|
|
|
(90)
|
|
|
—
|
|
|
2,370
|
|
|
|
OIBDA margin (b)
|
|
17%
|
|
|
|
|
|
|
|
|
|
|
|
17%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
1,816
|
|
|
81
|
|
|
(90)
|
|
|
—
|
|
|
1,807
|
|
|
|
Interest expense
|
|
(529)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(529)
|
|
|
|
Interest income
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
|
Loss on early extinguishment of
debt
|
|
(81)
|
|
|
—
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
|
Other items, net
|
|
10
|
|
|
—
|
|
|
(8)
|
|
|
—
|
|
|
2
|
|
|
|
Earnings before income
taxes
|
|
1,222
|
|
|
81
|
|
|
(17)
|
|
|
—
|
|
|
1,286
|
|
|
|
Provision for income
taxes
|
|
(463)
|
|
|
(32)
|
|
|
9
|
|
|
8
|
|
|
(478)
|
|
|
|
Effective income tax
rate
|
|
38%
|
|
|
|
|
|
|
|
|
|
|
|
37%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in loss of investee companies, net of tax
|
|
(35)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35)
|
|
|
|
Net earnings from continuing
operations
|
$
|
724
|
|
$
|
49
|
|
$
|
(8)
|
|
$
|
8
|
|
$
|
773
|
|
|
|
Diluted EPS from continuing
operations
|
$
|
1.04
|
|
$
|
.07
|
|
$
|
(.01)
|
|
$
|
.01
|
|
$
|
1.11
|
|
|
|
Diluted weighted average number
of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
common shares
outstanding
|
|
694
|
|
|
|
|
|
|
|
|
|
|
|
694
|
|
|
|
|
(a) Restructuring
charges at Entertainment, Publishing and Outdoor primarily
associated with the relocation and closure of certain business
activities and other exit costs.
(b) OIBDA margin is
defined as OIBDA or adjusted OIBDA divided by revenues.
(c) Restructuring
charges at Entertainment, Cable Networks, Publishing, Local
Broadcasting and Outdoor primarily reflecting severance costs
associated with the elimination of positions, contract terminations
and costs associated with exiting an operating facility.
(d) Reflects a
settlement of $90 million from the favorable resolution of certain
disputes regarding previously disposed businesses, a pre-tax loss
on early extinguishment of debt of $81 million and a gain of $8
million on the divestiture of the Company's television station in
Norfolk, Virginia.
(e) Comprising a $62
million reduction of deferred tax assets associated with the 2010
Patient Protection and Affordable Care Act, partially offset by a
$26 million reversal of previously established deferred tax
liabilities and a $28 million tax benefit from the settlements of
income tax audits.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE CBS Corporation