Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 22, 2016 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | DreamWorks Animation SKG, Inc. | |
Entity Central Index Key | 1,297,401 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Common Class A [Member] | ||
Entity Common Stock, Shares Outstanding | 78,698,244 | |
Common Class B [Member] | ||
Entity Common Stock, Shares Outstanding | 7,838,731 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Assets | ||
Cash and cash equivalents | $ 91,610 | $ 110,814 |
Trade accounts receivable, net of allowance for doubtful accounts | 253,803 | 271,466 |
Receivables from distributors, net of allowance for doubtful accounts | 240,846 | 230,569 |
Film and other inventory costs, net | 832,418 | 820,454 |
Prepaid expenses | 30,943 | 29,133 |
Other assets | 70,842 | 69,098 |
Investments in unconsolidated entities | 39,409 | 32,814 |
Property, plant and equipment, net of accumulated depreciation and amortization | 38,121 | 37,765 |
Intangible assets, net of accumulated amortization | 169,103 | 172,328 |
Goodwill | 190,668 | 190,668 |
Total assets | 1,957,763 | 1,965,109 |
Liabilities: | ||
Accounts payable | 15,374 | 10,847 |
Accrued liabilities | 150,929 | 199,665 |
Payable to former stockholder | 4,392 | 20,776 |
Deferred revenue and other advances | 72,608 | 74,659 |
Deferred gain on sale-leaseback transaction | 86,249 | 87,410 |
Revolving credit facility | 101,000 | 60,000 |
Senior unsecured notes, net of deferred financing costs | 295,399 | 295,134 |
Deferred taxes, net | 18,131 | 17,778 |
Total liabilities | $ 744,082 | $ 766,269 |
Commitments and contingencies | ||
DreamWorks Animation SKG, Inc. Stockholders' Equity: | ||
Additional paid-in capital | $ 1,234,549 | $ 1,227,220 |
Accumulated other comprehensive loss | (4,465) | (3,642) |
Retained earnings | 721,814 | 707,978 |
Less: Class A Treasury common stock, at cost, 28,551,078 and 28,401,898 shares, as of March 31, 2016 and December 31, 2015, respectively | (792,789) | (789,186) |
Total DreamWorks Animation SKG, Inc. stockholders' equity | 1,160,259 | 1,143,517 |
Non-controlling interests | 53,422 | 55,323 |
Total equity | 1,213,681 | 1,198,840 |
Total liabilities and equity | 1,957,763 | 1,965,109 |
Common Class A [Member] | ||
DreamWorks Animation SKG, Inc. Stockholders' Equity: | ||
Common stock | 1,072 | 1,069 |
Common Class B [Member] | ||
DreamWorks Animation SKG, Inc. Stockholders' Equity: | ||
Common stock | $ 78 | $ 78 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Common Class A [Member] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 350,000,000 | 350,000,000 |
Common stock, shares issued | 107,249,322 | 106,907,772 |
Class A Treasury common stock, shares | 28,551,078 | 28,401,898 |
Common Class B [Member] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 7,838,731 | 7,838,731 |
Common stock, shares outstanding | 7,838,731 | 7,838,731 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Income Statement [Abstract] | |||
Revenues | $ 190,442 | $ 166,530 | [1] |
Operating expenses (income): | |||
Costs of revenues | 114,624 | 106,165 | |
Selling and marketing | 6,140 | 8,475 | |
General and administrative | 60,250 | 89,142 | [1] |
Product development | 545 | 332 | [1] |
Other operating income | (4,941) | (2,281) | [1] |
Operating income (loss) | 13,824 | (35,303) | |
Non-operating income (expense): | |||
Interest expense, net | (4,987) | (6,334) | |
Other income (expense), net | 1,892 | (5,466) | |
Increase in income tax benefit payable to former stockholder | 0 | (25) | |
Income (loss) before income from equity method investees and income taxes | 10,729 | (47,128) | |
Income (loss) from equity method investees | 2,542 | (6,362) | [1] |
Income (loss) before income taxes | 13,271 | (53,490) | [1] |
Provision for income taxes | 1,130 | 2,400 | |
Net income (loss) | 12,141 | (55,890) | |
Less: Net loss attributable to non-controlling interests | (1,695) | (1,113) | |
Net income (loss) attributable to DreamWorks Animation SKG, Inc. | $ 13,836 | $ (54,777) | |
Net income (loss) per share of common stock attributable to DreamWorks Animation SKG, Inc. | |||
Basic net income (loss) per share (in dollars per share) | $ 0.16 | $ (0.64) | |
Diluted net income (loss) per share (in dollars per share) | $ 0.16 | $ (0.64) | |
Shares used in computing net income (loss) per share | |||
Basic (in shares) | 86,398 | 85,615 | |
Diluted (in shares) | 87,679 | 85,615 | |
[1] | Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 12,141 | $ (55,890) |
Other comprehensive loss, net of tax: | ||
Foreign currency translation losses | (823) | (810) |
Comprehensive income (loss) | 11,318 | (56,700) |
Less: Comprehensive loss attributable to non-controlling interests | (1,695) | (1,113) |
Comprehensive income (loss) attributable to DreamWorks Animation SKG, Inc. | $ 13,013 | $ (55,587) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Operating activities | |||
Net income (loss) | $ 12,141 | $ (55,890) | |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | |||
Amortization and write-off of film and other inventory costs | 95,461 | 93,352 | |
Other impairments and write-offs | 0 | 5,064 | |
Amortization of intangible and other assets | 5,821 | 3,977 | |
Depreciation and amortization | 1,492 | 13,374 | |
Amortization of deferred financing costs | 632 | 571 | |
Amortization of deferred gain on sale-leaseback transaction | (1,161) | 0 | |
Stock-based compensation expense | 4,861 | 4,399 | |
Revenue earned against deferred revenue and other advances | (34,013) | (16,469) | |
Income related to investment contributions | (4,053) | (2,281) | |
(Income) loss from equity method investees | (2,542) | 6,362 | [1] |
Deferred taxes, net | 353 | 679 | |
Changes in operating assets and liabilities: | |||
Restricted cash | 0 | 10,337 | |
Trade accounts receivable | 18,568 | (16,704) | |
Receivables from distributors | (10,706) | 54,648 | |
Film and other inventory costs | (102,957) | (89,192) | |
Prepaid expenses and other assets | (8,166) | (20,387) | |
Accounts payable and accrued liabilities | (44,318) | (25,015) | |
Payable to former stockholder | (16,384) | (7,328) | |
Income taxes payable/receivable, net | 318 | 305 | |
Deferred revenue and other advances | 31,760 | 41,760 | |
Net cash (used in) provided by operating activities | (52,893) | 1,562 | |
Investing activities | |||
Investments in unconsolidated entities | 0 | (510) | |
Purchases of property, plant and equipment | (3,709) | (1,845) | |
Net cash used in investing activities | (3,709) | (2,355) | |
Financing activities | |||
Deferred financing costs | 0 | (5,729) | |
Purchase of treasury stock | (3,603) | (2,013) | |
Contingent consideration payment | 0 | (335) | |
Borrowings from revolving credit facility | 71,000 | 340,405 | |
Repayments of borrowings from revolving credit facility | (30,000) | (475,405) | |
Proceeds from lease financing obligation | 0 | 185,000 | |
Repayments of lease financing obligation | 0 | (1,184) | |
Capital contribution from non-controlling interest holder | 0 | 15,000 | |
Distributions to non-controlling interest holder | (206) | (571) | |
Net cash provided by financing activities | 37,191 | 55,168 | |
Effect of exchange rate changes on cash and cash equivalents | 207 | 1,060 | |
(Decrease) increase in cash and cash equivalents | (19,204) | 55,435 | |
Cash and cash equivalents at beginning of period | 110,814 | 34,227 | |
Cash and cash equivalents at end of period | 91,610 | 89,662 | |
Non-cash investing activities: | |||
Intellectual property and technology licenses granted in exchange for equity interest | 3,918 | 2,225 | |
Services provided in exchange for equity interest | 135 | 55 | |
Total non-cash investing activities | 4,053 | 2,280 | |
Supplemental disclosure of cash flow information: | |||
Cash paid during the period for income taxes, net of amounts refunded | 487 | 1,441 | |
Cash paid during the period for interest, net of amounts capitalized | $ 10,092 | $ 12,132 | |
[1] | Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. |
Business and Basis of Presentat
Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Basis of Presentation | Business and Basis of Presentation Business The business of DreamWorks Animation SKG, Inc. ("DreamWorks Animation" or the "Company") is primarily devoted to the development, production and exploitation of animated films (and other audiovisual programs) and their associated characters in the worldwide theatrical, home entertainment, digital, television, merchandising, licensing and other markets. The Company continues to expand its library and increase the value of its intellectual property assets by developing and producing new episodic series and other non-theatrical content based on characters from its feature films. In addition, the Company has an extensive library of other intellectual property rights, which can be exploited in various markets. The Company's activities also include technology initiatives as it explores opportunities to exploit its internally developed software. The Company's business also includes AwesomenessTV ("ATV"), a multi-media platform company that generates revenues primarily from the production and distribution of content across a variety of channels, including short-form online video, theatrical, home entertainment, television and online video-on-demand, and sponsorship arrangements. On December 11, 2014, the Company entered into a Unit Purchase Agreement (the "Unit Purchase Agreement") with an affiliate of Hearst Corporation ("Hearst"). Pursuant to the Unit Purchase Agreement, Hearst acquired a 25% equity interest in a newly formed joint venture ("ATV Joint Venture") conducting the ATV business. The Company is consolidating the results of this joint venture because the Company continues to retain control over the operations of ATV. Subsequent to March 31, 2016, the Company entered into an agreement to sell additional interests in the ATV Joint Venture to an additional third party investor, which will reduce the Company's ownership percentage in the joint venture. Refer to Note 19 for further information. Pending Acquisition by Comcast Corporation On April 28, 2016, the Company, Comcast Corporation ("Comcast") and Comcast Paris Newco, Inc., a wholly-owned subsidiary of Comcast ("Merger Sub"), entered into an Agreement and Plan of Merger (the "Merger Agreement"). Upon the terms and subject to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into DreamWorks Animation, with DreamWorks Animation continuing as the surviving corporation and a wholly-owned subsidiary of Comcast (the "Merger"). Pursuant to the Merger Agreement, upon the closing of the Merger, each share of the Company’s Class A common stock and Class B common stock (collectively, "Company common stock"), issued and outstanding immediately prior to the effective time of the Merger (other than shares owned by the Company, Comcast, Merger Sub or any other subsidiary of Comcast or shares with respect to which appraisal rights have been properly exercised in accordance with the General Corporation Law of the State of Delaware) will be converted into the right to receive $41.00 in cash, without interest and less any applicable withholding taxes (the "Merger Consideration"). Each Company option and each Company stock appreciation right outstanding immediately prior to the effective time of the Merger, whether or not then vested and exercisable, will be cancelled and converted into the right to receive, for each share of Company common stock subject to such stock option or stock appreciation right, an amount in cash, without interest, equal to the excess, if any, of the Merger Consideration over the per share exercise price of such option or stock appreciation right. Each Company restricted stock unit and each Company performance restricted stock unit outstanding immediately prior to the effective time of the Merger will be cancelled and converted into the right to receive an amount in cash, without interest, equal to the Merger Consideration multiplied by the number of shares of Company common stock subject to such restricted stock unit or performance restricted stock unit (assuming in the case of performance restricted stock units, that applicable performance conditions are deemed to be achieved at the greater of target and actual performance). Each Company restricted share outstanding immediately prior to the effective time of the Merger will be cancelled and converted into the right to receive an amount in cash, without interest, equal to the Merger Consideration. The consummation of the Merger is subject to customary closing conditions, including (i) receiving the approval of holders of a majority of the voting power of the outstanding Company common stock, which approval was effected after execution of the Merger Agreement, by written consent of the Company's controlling stockholder, Jeffrey Katzenberg, (ii) the absence of legal restraints preventing the consummation of the Merger and (iii) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and receipt of specified other regulatory consents and approvals. The Merger Agreement contains certain customary covenants, including covenants providing (i) for each of the parties to use reasonable best efforts to cause the transaction to be consummated and (ii) for DreamWorks Animation to carry on its business in the ordinary course during the interim period between the execution of the Merger Agreement and completion of the Merger. The Merger Agreement contains specified termination rights for the parties. In connection with the termination of the Merger Agreement under certain circumstances, the Company will be required to pay to Comcast a “termination fee” equal to $152.0 million . Additionally, in connection with the termination of the Merger Agreement under specified antitrust-related circumstances, Comcast will be required to pay to DreamWorks Animation a "reverse termination fee" equal to $200.0 million . The foregoing description of the Merger Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, a copy of which is attached as Exhibit 2.1 to the Current Report on Form 8-K filed by the Company on April 28, 2016. Distribution and Servicing Arrangements The Company derives revenue from Twentieth Century Fox Film Corporation's worldwide (excluding China and South Korea) exploitation of its films in the theatrical and post-theatrical markets. Pursuant to a binding term sheet (the "Fox Distribution Agreement") entered into with Twentieth Century Fox and Twentieth Century Fox Home Entertainment, LLC (collectively, "Fox"), the Company has agreed to license Fox certain exclusive distribution rights and exclusively engage Fox to render fulfillment services with respect to certain of the Company's animated feature films and other audiovisual programs theatrically released during the five -year period beginning on January 1, 2013. As of July 1, 2014, Fox has also been licensed and engaged to render fulfillment services for the Company's feature films theatrically released prior to January 1, 2013 in theatrical, non-theatrical, home entertainment and digital media. The rights licensed to, and serviced by, Fox will terminate on the date that is one year after the initial home video release date in the United States ("U.S.") of the last film theatrically released by Fox during such five -year period, subject to licenses approved by the Company during such period that extend beyond such period. Also beginning in 2013, the Company's films are distributed in China and South Korea territories by separate distributors in each of these territories. The key terms of the Company's distribution arrangements with its Chinese and South Korean distributors are largely similar to those with Fox and Paramount such that the Company also recognizes revenues earned under these arrangements on a net basis. The Company's distribution partner in China is a subsidiary of Oriental DreamWorks Holding Limited ("ODW"), which is a related party (See Note 6). In addition, the Company continues to derive revenues from the distribution by Paramount Pictures Corporation, a subsidiary of Viacom Inc., and its affiliates (collectively, "Paramount") of its feature films released prior to January 1, 2013 pursuant to a distribution agreement and a fulfillment services agreement (collectively, the "Paramount Agreements"). As of July 1, 2014, the Company reacquired certain distribution rights to its feature films from Paramount, which rights have been licensed to Fox (as noted above). The amount paid to reacquire these rights was recorded as a definite-lived intangible asset. Paramount will continue to exploit and render fulfillment services in television and related media for feature films released prior to January 1, 2013 until the date that is 16 years after such film's theatrical release, and will continue to exploit and service certain other agreements with Paramount's sublicensees that remain in place after July 1, 2014. The Company generally retains all other rights to exploit its films, including commercial tie-in and promotional rights with respect to each film, as well as merchandising, interactive, literary publishing, music publishing and soundtrack rights. The Company's activities associated with its episodic series and ATV business are generally not subject to the Company's distribution agreements with its theatrical distributors. Basis of Presentation The accompanying unaudited financial data as of March 31, 2016 and for the three months ended March 31, 2016 and 2015 has been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") and in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information. Accordingly, certain information and footnote disclosures normally included in comprehensive financial statements have been condensed or omitted pursuant to such rules and regulations. The consolidated balance sheet as of December 31, 2015 was derived from the audited financial statements at that date, but does not include all the information and footnotes required by U.S. GAAP. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015 (the " 2015 Form 10-K"). The accompanying unaudited consolidated financial statements reflect all adjustments, consisting of only normal recurring items, which in the opinion of management, are necessary for a fair statement for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for the full year, or for any future period, as fluctuations can occur based upon the timing of the Company's films' theatrical and home entertainment releases, and deliveries of episodic content. Reclassifications Certain amounts in the prior period consolidated financial statements have been reclassified to conform to the Company's 2016 presentation. Consolidation The consolidated financial statements of the Company present the financial position, results of operations and cash flows of DreamWorks Animation and its wholly-owned and majority-owned subsidiaries. The Company also consolidates less-than-wholly owned entities if the Company has a controlling financial interest in that entity. The Company uses the equity method of accounting for investments in companies in which it has a 50% or less ownership interest and has the ability to exercise significant influence. Such investments are presented as investments in unconsolidated entities on the Company's consolidated balance sheets (refer to Note 6 for further information of such investments). Prior to recording its share of net income or losses from equity method investees, investee financial statements are converted to U.S. GAAP. All significant intercompany accounts and transactions have been eliminated. Intra-entity profit related to transactions with equity method investees is eliminated until the amounts are ultimately realized. In addition, the Company reviews its relationships with other entities to identify whether they are variable interest entities ("VIE") as defined by the Financial Accounting Standards Board ("FASB"), and to assess whether the Company is the primary beneficiary of such entity. If the determination is made that the Company is the primary beneficiary, then the entity is consolidated. As of March 31, 2016 , the Company determined that it continued to have a variable interest in ODW as ODW does not have sufficient equity at risk (i.e., cash on hand to fund its operations) as a result of the timing of capital contributions to the entity in accordance with the Transaction and Contribution Agreement (see Note 6). However, the Company concluded that it is not the primary beneficiary of ODW as it does not have deemed control of ODW. As a result, it does not consolidate ODW into its financial statements. Refer to Note 6 for further discussion of how the Company accounts for its investment in ODW, including the remaining contributions (which represent the maximum exposure to the Company). Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The most significant estimates made by management in the preparation of the financial statements relate to the following: • ultimate revenues and ultimate costs of film and television product; • relative selling price of the Company's products for purposes of revenue allocation in multi-property licenses and other multiple deliverable arrangements; • determination of the fair value of reporting units for purposes of testing goodwill for impairment; • determination of fair value of non-cash contributions to investments in unconsolidated entities; • useful lives of intangible assets; • product sales that will be returned and the amount of receivables that ultimately will be collected; • the potential outcome of future tax consequences of events that have been recognized in the Company's financial statements; • loss contingencies; and • assumptions used in the determination of the fair value of equity-based awards for stock-based compensation or their probability of vesting. Actual results could differ from those estimates. To the extent that there are material differences between these estimates and actual results, the Company's financial condition or results of operations will be affected. Estimates are based on past experience and other assumptions that management believes are reasonable under the circumstances, and management evaluates these estimates on an ongoing basis. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2016, the FASB issued an accounting standards update to simplify certain provisions related to the accounting for stock-based compensation. First, the guidance requires the income tax effects of stock-based compensation awards to be recognized in the income statement when the awards vest or are settled and is to be applied on a prospective basis. The guidance also requires the presentation of excess tax benefits as an operating activity on the statements of cash flows rather than as a financing activity, and this presentation can be applied retrospectively or prospectively. The guidance also increases the amount companies can withhold to cover income taxes on awards without triggering liability classification for shares used to satisfy statutory income tax withholding obligations and requires application of a modified retrospective transition method for this provision. Lastly, the new guidance allows the Company to make an entity-wide election to either continue estimating the number of awards that are expected to vest or account for forfeitures as they occur. The guidance is effective for the Company’s fiscal years beginning January 1, 2017, including interim periods within that fiscal year, with early adoption permitted. However, all provisions would need to be adopted in the same period. The Company is in the process of evaluating the impact that the new standard will have on its consolidated financial statements. In February 2016, the FASB issued an accounting standards update to increase transparency and comparability among companies by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Once it becomes effective, the new guidance will replace existing lease accounting guidance in U.S. GAAP. Under the new standard, lessees will recognize in its balance sheets a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. The guidance is effective for the Company's fiscal year beginning January 1, 2019, including interim periods within that fiscal year, with early adoption permitted. Companies are required to apply the guidance in the year of adoption with the cumulative effect recognized at the date of initial application (referred to as the modified retrospective approach). The Company is in the process of evaluating the impact that the new standard will have on its consolidated financial statements. In April 2015, the FASB issued an accounting standards update relating to the presentation of debt issuance costs. The accounting update requires companies to present debt issuance costs related to a recognized debt liability presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In addition, in August 2015, the FASB issued an accounting standards update to incorporate an SEC staff announcement that the SEC staff will not object to an entity presenting debt issuance costs related to line-of-credit arrangements as an asset regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The guidance is effective for the Company's fiscal year beginning January 1, 2016. The Company adopted the new guidance effective January 1, 2016. As a result, the Company now presents deferred financing costs associated with its senior unsecured notes as a deduction to the debt liability. In addition, as the Company was required to adopt the guidance on a retrospective basis, the Company reclassified amounts in its December 31, 2015 balance sheet to conform to the current period presentation. See Note 9 for further information related to the amounts presented as a deduction to the liability. As it relates to the Company's revolving credit facility, the associated deferred financing costs will continue to be presented within other assets. In February 2015, the FASB issued an accounting standards update to amend existing guidance relating to the evaluation of certain legal entities for potential consolidation. The amendments modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities. In addition, the amendments modify the guidance on evaluating whether a fee paid to a decision maker or a service provider represents a variable interest and whether it should be included in the evaluation of the economics criterion in determining which party is the primary beneficiary of a VIE. In accordance with the accounting standards update, companies are required to reevaluate all legal entities that are considered VIEs to determine whether there is a change in the conclusion as to whether the VIE should be consolidated. The guidance is effective for the Company's fiscal year beginning January 1, 2016, with early adoption permitted. The Company adopted the new guidance effective January 1, 2016. The adoption of this guidance did not change the Company's existing conclusions related to its VIEs and voting interest entities and, as a result, the adoption did not have an impact to the Company's consolidated financial statements. In May 2014, the FASB issued an accounting standards update to provide companies with a single model for use in accounting for revenue from contracts with customers. Once it becomes effective, the new guidance will replace most existing revenue recognition guidance in U.S. GAAP, including industry-specific guidance. The core principle of the model is to recognize revenue when control of goods or services transfers to the customer and in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods or services that have transferred. Under current U.S. GAAP, the Company recognizes revenue when the risks and rewards of ownership transfer to the customer. In addition, the new guidance requires improved disclosures to help users of financial statements better understand the nature, amount, timing and uncertainty of revenue that is recognized and the related cash flows. The guidance is effective for the Company's fiscal year beginning January 1, 2018, including interim periods within that fiscal year. Early adoption is permitted but no earlier than the Company's fiscal year beginning January 1, 2017. Companies are permitted to either apply the guidance retrospectively to all prior periods presented or, alternatively, apply the guidance in the year of adoption with the cumulative effect recognized at the date of initial application (referred to as the modified retrospective approach). The Company does not expect that it will early adopt this standard. The Company is in the process of concluding on the method of adoption, as well as evaluating the impact that the new standard will have on its consolidated financial statements. However, the Company currently expects that it will adopt the new guidance under the full retrospective approach. |
Financial Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments | Financial Instruments The fair value of cash and cash equivalents, accounts payable, advances and amounts outstanding under the revolving credit facility approximates carrying value due to the short-term maturity of such instruments and floating interest rates. As of March 31, 2016 , the fair value of trade accounts receivable approximated carrying value due to the similarities in the initial and current discount rates. In addition, as of March 31, 2016 , the fair value and the carrying value of the principal amount of the senior unsecured notes was $308.9 million and $300.0 million , respectively. The fair value of trade accounts receivable and the senior unsecured notes was determined using significant unobservable inputs by performing a discounted cash flow analysis and using current discount rates as appropriate for each type of instrument. The Company has short-term money market investments which are classified as cash and cash equivalents on the consolidated balance sheets. The fair value of these investments at March 31, 2016 and December 31, 2015 was measured based on quoted prices in active markets. |
Film and Other Inventory Costs
Film and Other Inventory Costs | 3 Months Ended |
Mar. 31, 2016 | |
Film Costs [Abstract] | |
Film And Other Inventory Costs | Film and Other Inventory Costs Film, television and other inventory costs consist of the following (in thousands): March 31, December 31, In release, net of amortization: Feature films $ 338,617 $ 227,372 Television series and specials 139,617 124,911 In production: Feature films 198,391 308,114 Television series and specials 41,896 50,810 In development: Feature films 102,706 99,541 Television series and specials 1,827 846 Product inventory and other (1) 9,364 8,860 Total film, television and other inventory costs, net $ 832,418 $ 820,454 _____________________ (1) As of March 31, 2016 and December 31, 2015 , this category included $6.9 million and $6.7 million , respectively, of physical inventory primarily related to certain titles for distribution in the home entertainment market. The Company anticipates that approximately 53% and 80% of the above "in release" film and other inventory costs as of March 31, 2016 will be amortized over the next 12 months and three years, respectively. No impairment charges were recorded on film and other inventory costs during the three months ended March 31, 2016. During the three months ended March 31, 2015, impairment charges recorded on film and other inventory costs were immaterial. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets As of March 31, 2016 and December 31, 2015 , intangible assets included $69.4 million of indefinite-lived intangible assets comprised of character rights. In addition, intangible assets included definite-lived intangible assets as follows (in thousands, unless otherwise noted): Weighted Average Estimated Useful Life (in years) Gross Accumulated Amortization Impact of Foreign Currency Translation Net As of March 31, 2016: Character rights 13.9 $ 99,000 $ (22,500 ) $ (3,701 ) $ 72,799 Distribution rights 11.2 30,000 (5,434 ) — 24,566 Trademarks and trade names 10.0 1,410 (391 ) — 1,019 Other intangibles 4.4 2,700 (1,381 ) — 1,319 Total $ 133,110 $ (29,706 ) $ (3,701 ) $ 99,703 As of December 31, 2015: Character rights 13.9 $ 99,000 $ (21,150 ) $ (2,734 ) $ 75,116 Distribution rights 11.2 30,000 (4,671 ) — 25,329 Trademarks and trade names 10.0 1,410 (356 ) — 1,054 Other intangibles 4.4 2,700 (1,271 ) — 1,429 Total $ 133,110 $ (27,448 ) $ (2,734 ) $ 102,928 |
Investments in Unconsolidated E
Investments in Unconsolidated Entities | 3 Months Ended |
Mar. 31, 2016 | |
Investments in Unconsolidated Entities [Abstract] | |
Investments in Unconsolidated Entities | Investments in Unconsolidated Entities The Company has made investments in entities which are accounted for under either the cost or equity method of accounting. These investments are classified as investments in unconsolidated entities in the consolidated balance sheets and consist of the following (in thousands, unless otherwise indicated): Ownership Percentage at March 31, December 31, March 31, 2016 2016 2015 Oriental DreamWorks Holding Limited 45.45% $ 23,409 $ 16,814 Total equity method investments 23,409 16,814 Total cost method investments 16,000 16,000 Total investments in unconsolidated entities $ 39,409 $ 32,814 As of March 31, 2015, the Company determined that one of its equity method investments was impaired and that the carrying value would not be recoverable, primarily due to the Company's concerns related to the investee's financial condition. As a result, the Company determined that the fair value of the investment was zero and, accordingly, during the three months ended March 31, 2015, it recorded an impairment charge in the amount of $5.1 million related to such investment. Fair value was estimated using significant unobservable inputs. Under the equity method of accounting, the carrying value of an investment is adjusted for the Company's proportionate share of the investees' earnings and losses (adjusted for the amortization of any differences in the Company's basis, with respect to the Company's investment in ODW, compared to the Company's share of venture-level equity), as well as contributions to and distributions from the investee. The Company classifies its share of income or loss from investments accounted for under the equity method as income/loss from equity method investees in its consolidated statements of operations. Income (loss) from equity method investees consist of the following (in thousands): Three Months Ended March 31, 2016 2015 Oriental DreamWorks Holding Limited (1) $ 2,542 $ (5,398 ) All Other — (964 ) Income (loss) from equity method investees $ 2,542 $ (6,362 ) ____________________ (1) The Company currently records its share of ODW results on a one-month lag. Accordingly, the Company's consolidated financial statements include its share of income earned or losses incurred by ODW from the period beginning and ending one month prior to the period shown in the table. The following table presents summarized financial information for ODW (in thousands): March 31, December 31, 2016 2015 Current assets $ 92,742 $ 49,427 Noncurrent assets $ 74,056 $ 73,340 Current liabilities $ 64,834 $ 28,114 Noncurrent liabilities $ 156 $ 233 Three Months Ended March 31, 2016 2015 Revenues $ 60,249 $ 2,618 Costs of revenues $ 50,200 $ 2,707 Net income (loss) $ 5,100 $ (12,576 ) Oriental DreamWorks Holding Limited On April 3, 2013 ("ODW Closing Date"), the Company formed a Chinese Joint Venture, ODW (or the "Chinese Joint Venture"), through the execution of a Transaction and Contribution Agreement, as amended, with its Chinese partners, China Media Capital (Shanghai) Center L.P. ("CMC"), Shanghai Media Group ("SMG") and Shanghai Alliance Investment Co., Ltd. ("SAIL", and together with CMC and SMG, the "CPE Holders"). In exchange for 45.45% of the equity of ODW, the Company has committed to making a total cash capital contribution to ODW of $50.0 million (of which $17.0 million had been funded as of March 31, 2016 , with the balance to be funded over time) and non-cash contributions valued at approximately $100.0 million (of which approximately $49.1 million had been satisfied as of March 31, 2016 ). Such non-cash contributions include licenses of technology and certain other intellectual property of the Company, rights in certain trademarks of the Company, two in-development feature film projects developed by the Company and consulting and training services. During the three months ended March 31, 2016, the Company's consolidated statements of operations included $2.5 million of revenues recognized in connection with non-cash contributions made to ODW. In addition, the Company's consolidated statements of operations included other operating income recognized in connection with non-cash contributions made to ODW of $1.5 million and $2.3 million during the three months ended March 31, 2016 and 2015 , respectively. As of March 31, 2016 , the Company's remaining contributions consisted of the following: (i) $33.0 million in cash (which is expected to be funded over the next two years), (ii) two of the Company's in-development film projects, (iii) remaining delivery requirements under the license of technology and (iv) approximately $6.4 million in consulting and training services. Some of these remaining contribution commitments will require future cash outflows for which the Company is not currently able to estimate the timing of contributions as this will depend on, among other things, ODW's operations. Basis Differences. The Company's investment in ODW does not equal the venture-level equity (the amount recorded on the balance sheet of ODW) due to various basis differences. Basis differences related to definite-lived assets are being amortized based on the useful lives of the related assets. Basis differences related to indefinite-lived assets are not being amortized. The following are the differences between the Company's venture-level equity and the balance of its investment in ODW (in thousands): March 31, December 31, 2016 2015 Company's venture-level equity $ 46,272 $ 42,914 Technology and intellectual property licenses (1) (2,916 ) (6,833 ) Other (2) (19,947 ) (19,267 ) Total ODW investment recorded $ 23,409 $ 16,814 ____________________ (1) Represents differences between the Company's historical cost basis and the equity basis reflected at the venture-level (the amount recorded on the balance sheet of ODW) related to the Company's contributions of technology and intellectual property licenses. These basis differences arise because the contributed assets are recorded at fair value by ODW. (2) Represents the Company's net contribution commitment due to ODW. Other Transactions with ODW. The Company has various other transactions with ODW, a related party. The Company has entered into a distribution agreement with ODW for the distribution of the Company's feature films in China. In addition, from time to time, the Company may provide consulting and training services to ODW, the charges of which are based on the Company's actual cost of providing such services. The Company's consolidated statements of operations included revenues earned primarily through ODW's distribution of its feature films of $21.5 million and $0.4 million during the three months ended March 31, 2016 and 2015 , respectively. As of March 31, 2016 and December 31, 2015 , the Company's consolidated balance sheets included receivables from ODW of $6.6 million and $4.7 million , respectively, which were classified as a component of trade accounts receivable, and $20.5 million and $1.1 million , respectively, which were classified as a component of receivables from distributors. During the three months ended March 31, 2016, the Company released Kung Fu Panda 3 , a feature film that is the subject of a collaborative production and distribution arrangement among the Company, ODW and certain other parties. Under this arrangement, each party is responsible for certain production costs and the Company only records the portion of the production costs that it incurred. The other parties only have rights to exploit the title for its initial theatrical release in China. The Company records revenues earned from the exploitation of the title in China net of permissible marketing and distribution expenses, similar to its other titles that are distributed by ODW. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued liabilities consist of the following (in thousands): March 31, December 31, 2016 2015 Employee compensation $ 35,217 $ 85,616 Participations and residuals 49,855 46,562 Interest payable 2,838 8,069 Deferred rent 10,589 10,446 Other accrued liabilities 52,430 48,972 Total accrued liabilities $ 150,929 $ 199,665 As of March 31, 2016 , the Company estimates that over the next 12 months it will pay approximately $24.4 million of its accrued participation and residual costs. |
Deferred Revenue and Other Adva
Deferred Revenue and Other Advances | 3 Months Ended |
Mar. 31, 2016 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenue and Other Advances | Deferred Revenue and Other Advances The following is a summary of deferred revenue and other advances included in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 and the related amounts earned and recorded either as revenue in the consolidated statements of operations or recorded as an offset to other costs (as described below) for the three- month periods ended March 31, 2016 and 2015 (in thousands): Amounts Earned Three Months Ended March 31, December 31, March 31, 2016 2015 2016 2015 Deferred Revenue (1) $ 16,710 $ 25,035 $ 13,074 $ 118 Strategic Alliance/Development Advances (2) 5,143 1,826 2,614 7,684 Other (3) 50,755 47,798 18,835 14,547 Total deferred revenue and other advances $ 72,608 $ 74,659 ______________________ (1) "Deferred revenue" consists of those arrangements related to the licensing of content for distribution in the home entertainment, television and new media markets. (2) Of the total amounts earned against the "Strategic Alliance/Development Advances," for the three months ended March 31, 2016 and 2015 , $0.4 million and $4.0 million , respectively, were capitalized as an offset to property, plant and equipment. Additionally, during the three months ended March 31, 2016 and 2015 , $0.2 million and $0.9 million , respectively, were recorded as a reduction to prepaid expenses. Lastly, during the three months ended March 31, 2016 and 2015 , of the total amounts earned, $0.4 million and $0.6 million , respectively, were recorded as a reduction to operating expenses. (3) "Other" consists of all remaining arrangements that result in deferred revenue or other advances and are related to a variety of activities that result in amounts being earned to either revenues or other income. |
Financing Arrangements
Financing Arrangements | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Financing Arrangements | Financing Arrangements Senior Unsecured Notes. On August 14, 2013, the Company issued $300.0 million in aggregate principal amount of 6.875% Senior Notes due 2020 (the "Notes"). In connection with the issuance of the Notes, the Company entered into an indenture (the "Indenture") with The Bank of New York Mellon Trust Company, N.A., as trustee, specifying the terms of the Notes. The Notes were sold at a price to investors of 100% of their principal amount and were issued in a private placement pursuant to the exemptions under Rule 144A and Regulation S under the Securities Act of 1933, as amended. The net proceeds from the Notes amounted to $294.0 million and a portion was used to repay the outstanding borrowings under the Company's revolving credit facility. The Notes are effectively subordinated to indebtedness under the revolving credit facility. The Company is required to pay interest on the Notes semi-annually in arrears on February 15 and August 15 of each year. The principal amount is due upon maturity. The Notes are guaranteed by all of the Company's domestic subsidiaries that also guarantee its revolving credit facility. The Indenture contains certain restrictions and covenants that, subject to certain exceptions, limit the Company's ability to incur additional indebtedness, pay dividends or repurchase the Company's common shares, make certain loans or investments, and sell or otherwise dispose of certain assets, among other limitations. The Indenture also contains customary events of default, which, if triggered, may accelerate payment of principal, premium, if any, and accrued but unpaid interest on the Notes. Such events of default include non-payment of principal and interest, non-performance of covenants and obligations, default on other material debt, failure to satisfy material judgments and bankruptcy or insolvency. If a change of control as described in the Indenture occurs, the Company may be required to offer to purchase the Notes from the holders thereof at a repurchase price equal to 101% of their principal amount, plus accrued and unpaid interest, if any, to, but not including, the date of repurchase. At any time prior to August 15, 2016, the Company may redeem all or part of the Notes at a redemption price equal to the sum of (i) 100% of the principal amount thereof, plus (ii) a specified premium as of the date of redemption, plus (iii) accrued and unpaid interest to, but not including, the date of redemption, subject to the rights of holders of Notes on the relevant record date to receive interest due on the relevant interest payment date. On or after August 15, 2016, the Company may redeem all or a part of the Notes, at specified redemption prices plus accrued and unpaid interest thereon, to, but not including, the applicable redemption date, subject to the rights of holders of Notes on the relevant record date to receive interest due on the relevant interest payment date. In addition, at any time prior to August 15, 2016, the Company may redeem up to 35% of the Notes with the net proceeds of certain equity offerings at a redemption price equal to 106.875% of the principal amount thereof, in each case plus accrued and unpaid interest and additional interest, if any, thereon to, but not including, the redemption date. Revolving Credit Facility. Prior to February 20, 2015, the Company had a revolving credit facility with a number of banks which allowed the Company to borrow up to a maximum of $400.0 million ("Prior Credit Agreement"). On February 20, 2015, the Company and the facility banks amended and restated the Prior Credit Agreement by entering into an Amended and Restated Credit Agreement (the "Restated Credit Agreement"). The Restated Credit Agreement allows the Company to have outstanding borrowings of up to $450.0 million at any one time, on a revolving basis. The Company and one or more of the lenders may from time to time, so long as no default or event of default has occurred under the Restated Credit Agreement, agree to increase the commitments under the Restated Credit Agreement by up to $50.0 million . As of March 31, 2016 , the Company had $349.0 million of availability under its revolving credit facility. Under the Restated Credit Agreement, the Company is required to pay a commitment fee on undrawn amounts at an annual rate of 0.375% . Interest on borrowed amounts (per draw) is determined by reference to either (i) the lending banks' base rate plus 1.50% per annum or (ii) the London Interbank Offered Rate ("LIBOR") plus 2.50% per annum. The Restated Credit Agreement also contains a sublimit for letters of credit. The Company is required to pay to the lenders under the Restated Credit Agreement a letter of credit participation fee equal to the applicable margin for LIBOR-based borrowings on the average daily undrawn amount of outstanding letters of credit and pay to each issuer of letters of credit a letter of credit fronting fee equal to 0.125% per annum on the average daily undrawn amount of outstanding letters of credit issued by such letter of credit issuer. The Restated Credit Agreement requires the Company to maintain a specified ratio of total debt to total capitalization, and limits the outstanding credit exposure under the Restated Credit Agreement to a specified ratio of net remaining ultimates to the outstanding credit exposure under the Restated Credit Agreement, plus an additional amount based on the valuation of the Company's film library. Subject to specified exceptions, the Restated Credit Agreement also restricts the Company and substantially all of its subsidiaries from taking certain actions, such as granting liens, entering into any merger or other significant transactions, making distributions (including dividends), entering into transactions with affiliates, agreeing to negative pledge clauses and restrictions on subsidiary distributions, and modifying organizational documents. The obligations of the Company under the Restated Credit Agreement are guaranteed by substantially all the subsidiaries of the Company organized under the laws of the United States of America, and substantially all the tangible and intangible assets of the Company and such subsidiaries are pledged as collateral against borrowings under the Restated Credit Agreement. Lease Financing Obligation. On February 23, 2015, the Company, as seller, entered into a purchase agreement (the "Glendale Purchase Agreement") with a third party buyer ("Landlord") involving the Company's headquarters facility located in Glendale, California (the "Property"). The Property is comprised of, among other things, 10 buildings on approximately 14.7 acres of land. Pursuant to the Glendale Purchase Agreement, the Company sold the Property to Landlord for a purchase price of $185.0 million . In addition, the Company entered into a sharing agreement (the "Sharing Agreement") with the Landlord whereby the Company will either pay or receive 50% of the net appreciation or depreciation in the sale price of the Property if the Landlord sells the property to a third-party prior to February 23, 2016. Concurrently with the sale of the Property, the Company and Landlord entered into a lease agreement (the "Lease"), pursuant to which Landlord leased the Property to the Company commencing immediately following the consummation of the sale. Annual rent during the initial term of the Lease starts at approximately $13.2 million , and increases one and one-half percent each year. The initial term of the Lease is 20 years , and the Company has four consecutive renewal options of five years each. The first two of such renewal terms are subject to fixed rent increasing by one and one-half percent each year, and the rent during each of such last two renewal terms will be the greater of (i) the rent in effect immediately preceding such renewal term or (ii) the then-current fair market value rent. The Lease is structured as a "triple net" lease, meaning that the Company is responsible for all expenses arising from the use or operation of the Property, including repairs, maintenance, insurance and taxes. The Lease also contains provisions regarding the obligations of the Company and Landlord in connection with a casualty or condemnation of the Property. Other than a sale by the initial Landlord party to the Lease, if any subsequent landlord decides to sell or otherwise convey title to the Property to a third party during the term of the Lease, the Company shall have a right of first refusal to purchase the Property on the same terms offered to such third party. The Company initially accounted for the sale and lease arrangement (as described above) as a financing transaction as it did not qualify for sale-leaseback accounting treatment because of the Company's continuing involvement through the Sharing Agreement. Under the financing accounting method, the Property assets remain on the Company's consolidated balance sheets and proceeds received by the Company are recorded as a financing liability. Payments under the Lease are applied as payments of deemed principal and imputed interest on the underlying financing obligation. On July 21, 2015, the Company's Landlord sold the Property to an unaffiliated third party for a total sale price of $215.0 million . Pursuant to the Sharing Agreement, the Company received approximately $14.2 million from the Landlord following such sale and these additional proceeds were recorded as an increase to the lease financing obligation. Upon receipt of these proceeds, the Company concluded that it no longer had continuing involvement beyond a normal leaseback of the Property. As a result, the Company further concluded that the transaction may be accounted for as a sale and operating leaseback on a prospective basis. Accordingly, the Company's lease financing obligation balance was reduced to zero, its property, plant and equipment balance was reduced by $109.4 million , representing the net book value (as of July 21, 2015) of the assets sold, and the Company recorded a deferred gain on the sale-leaseback transaction in the amount of $88.5 million . The deferred gain will be amortized on a straight-line basis over the remaining initial lease term and recorded as a component of other operating income. The Company presents deferred financing costs associated with its senior unsecured notes as a direct deduction from the carrying amount of the liability (refer to Note 2 for further information). Senior unsecured notes, net of deferred financing costs, as presented on the Company's consolidated balance sheets consist of the following (in thousands): March 31, December 31, 2016 2015 Senior unsecured notes, principal balance $ 300,000 $ 300,000 Less: unamortized deferred financing costs (4,601 ) (4,866 ) Senior unsecured notes, net of deferred financing costs $ 295,399 $ 295,134 Additional Financing Information Interest Capitalized to Film Costs. Interest on borrowed funds that are invested in major projects with substantial development or construction phases is capitalized as part of the asset cost until the projects are released or construction projects are put into service. Thus, capitalized interest is amortized over future periods on a basis consistent with that of the asset to which it relates. During the three months ended March 31, 2016 and 2015 , the Company incurred interest costs totaling $6.7 million and $8.5 million , respectively, of which $0.8 million and $1.0 million , respectively, were capitalized to film costs. As of March 31, 2016 , the Company was in compliance with all applicable financial debt covenants. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company typically determines its interim income tax provision by using the estimated annual effective tax rate and applying that rate to income/loss on a current year-to-date basis, adjusted for the tax effects of items that relate discretely to the interim period, if any. However, if minor changes to forecasted annual pre-tax earnings have a significant effect on the estimated annual effective tax rate, or if a reliable estimate of the annual effective tax rate cannot otherwise be made, the Company may determine that this method would not be appropriate and that a different method should be applied. Furthermore, as a result of a partial increase in the tax basis of the Company's tangible and intangible assets attributable to transactions entered into by affiliates controlled by a former stockholder at the time of the Company's 2004 initial public offering ("Tax Basis Increase"), the Company may pay reduced tax amounts to the extent it generates sufficient taxable income in the future (refer to the Company's 2015 Form 10-K for a more detailed description). The Company is obligated to remit to the affiliate of the former stockholder 85% of any realized cash savings in U.S. Federal income tax, California franchise tax and certain other related tax benefits. Due to the effect of this arrangement on the Company's provision for income taxes, the Company also combines the effect of the increase/decrease in income tax benefit payable to former stockholder (referred to as the combined effective tax rate). For the three months ended March 31, 2016, the Company determined that the annual effective tax rate method would not represent a reliable estimate of the interim income tax provision. As a result, the Company utilized a discrete period method to calculate taxes for the three months ended March 31, 2016. Under the discrete period method, the Company determined the income tax provision based upon actual results as if the interim period were an annual period. For the three months ended March 31, 2015, the Company utilized the annual effective tax rate method (as described above) to calculate the income tax provision for the three-month period then ended. For the three months ended March 31, 2016, the Company recorded a provision for income taxes of $1.1 million , or an effective tax rate of 8.5% . The Company's combined effective tax rate for the three months ended March 31, 2016 was also 8.5% as the Company did not record an increase nor decrease to the Payable to Former Stockholder in its statements of operations. For the three months ended March 31, 2015, the Company recorded a provision for income taxes of $2.4 million , or an effective tax rate of (4.5)% . For the three months ended March 31, 2015, the Company's combined effective tax rate was also (4.5)% . The Company's effective tax rate and combined effective tax rate for the three months ended March 31, 2015 were negative due to a loss before income taxes. The Company's effective tax rates and combined effective tax rates for the three months ended March 31, 2016 and 2015 were lower than the 35% statutory federal rate as the rates in each period were primarily attributable to the effect of a valuation allowance, as well as foreign taxes. The Company's federal income tax returns for the tax years ended December 31, 2007 through 2009 and for the years ended December 31, 2012 through 2013 are currently under examination by the Internal Revenue Service, and tax years subsequent to 2013 remain open to audit. The Company's California state tax returns for all years subsequent to 2010 remain open to audit. The Company's India subsidiary's income tax returns are currently under examination for the tax years ended March 31, 2013 through 2014. |
Stockholders' Equity and Non-Co
Stockholders' Equity and Non-Controlling Interests | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity and Non-Controlling Interests | Stockholders' Equity and Non-Controlling Interests Class A Common Stock Stock Repurchase Program. In July 2010, the Company's Board of Directors authorized a stock repurchase program pursuant to which the Company may repurchase up to an aggregate of $150.0 million of its outstanding stock. During the three months ended March 31, 2016 and 2015 , the Company did not repurchase any shares of its Class A Common Stock. As of March 31, 2016 , the Company's remaining authorization under the current stock repurchase program was $100.0 million . Non-Controlling Interests The Company's consolidated balance sheets include non-controlling interests, which are presented as a separate component of equity. A non-controlling interest represents the other equity holder's interest in a joint venture that the Company consolidates. The net income or loss attributable to the non-controlling interests is presented in the Company's consolidated statements of operations. There is no other comprehensive income or loss attributable to the non-controlling interests. Additional Equity Information The following table presents the changes in equity for the three- month periods ended March 31, 2016 and 2015 (in thousands): DreamWorks Animation SKG, Inc. Stockholders' Equity Non-Controlling Interests Total Equity Balance as of December 31, 2015 $ 1,143,517 $ 55,323 $ 1,198,840 Stock-based compensation 7,332 — 7,332 Purchase of treasury shares (3,603 ) — (3,603 ) Foreign currency translation adjustments (823 ) — (823 ) Distributions to non-controlling interest holder — (206 ) (206 ) Net income (loss) 13,836 (1,695 ) 12,141 Balance as of March 31, 2016 $ 1,160,259 $ 53,422 $ 1,213,681 Balance as of December 31, 2014 $ 1,156,357 $ 38,041 $ 1,194,398 Stock-based compensation 6,780 — 6,780 Purchase of treasury shares (2,013 ) — (2,013 ) Foreign currency translation adjustments (810 ) — (810 ) DreamWorks Animation SKG, Inc. Stockholders' Equity Non-Controlling Interests Total Equity Capital contribution from non-controlling interest holder — 15,000 15,000 Distributions to non-controlling interest holder — (571 ) (571 ) Net loss (54,777 ) (1,113 ) (55,890 ) Balance as of March 31, 2015 $ 1,105,537 $ 51,357 $ 1,156,894 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes compensation costs for equity awards granted to its employees based on each award's grant-date fair value. Most of the Company's equity awards contain vesting conditions dependent upon the completion of specified service periods or achievement of established sets of performance criteria. Compensation cost for service-based equity awards is recognized ratably over the requisite service period. Compensation cost for certain performance-based awards is recognized using a graded expense-attribution method and is adjusted to reflect the estimated probability of vesting. The Company has granted performance-based awards where the value of the award upon vesting will vary depending on the level of performance ultimately achieved. The Company recognizes compensation cost for these awards based on the level of performance expected to be achieved. The Company will recognize the impact of any change in estimate in the period of the change. Generally, equity awards are forfeited by employees who terminate prior to vesting. However, employment contracts for certain executive officers and other employees provide for the acceleration of vesting in the event of a change in control or specified termination events. The Company currently satisfies exercises of stock options and stock appreciation rights, the vesting of restricted stock and the delivery of shares upon the vesting of restricted stock units with the issuance of new shares. The impact of stock-based compensation awards on net income (excluding amounts capitalized) for the three- month periods ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 2015 Total stock-based compensation $ 4,861 $ 4,399 Tax impact (1) (413 ) 198 Reduction in net income, net of tax $ 4,448 $ 4,597 ____________________ (1) Tax impact was determined at the Company's combined effective tax rate, which includes the statements of operations line item "Increase in income tax benefit payable to former stockholder" (see Note 10). Stock-based compensation cost capitalized as a part of film costs was $2.4 million and $2.3 million for the three-month periods ended March 31, 2016 and 2015 , respectively. The following table sets forth the number and weighted average grant-date fair value of equity awards granted during the three- month periods ended March 31, 2016 and 2015 : Three Months Ended March 31, Number Granted Weighted Average Grant-Date Fair Value (in thousands) 2016 Restricted stock units 305 $ 24.90 2015 Restricted stock units 777 $ 21.41 As of March 31, 2016 , the total compensation cost related to unvested equity awards granted to employees (excluding equity awards with performance objectives not probable of achievement) but not yet recognized was approximately $63.8 million and will be amortized on a straight-line basis, or using a graded-attribution method for certain performance-based awards, over a weighted average period of 1.8 years. |
Reportable Segments
Reportable Segments | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Reportable Segments | Reportable Segments The Company's current reportable segments are the following: Feature Films, Television Series and Specials, Consumer Products and New Media. Feature Films consists of the development, production and exploitation of feature films in the theatrical, television, home entertainment and digital markets. Television Series and Specials consists of the development, production and exploitation of television, direct-to-video and other non-theatrical content in the television, home entertainment and digital markets. Consumer Products consists of the Company's merchandising and licensing activities related to the exploitation of its intellectual property rights. New Media consists of the Company's ATV and related businesses. This segment primarily generates revenues from the production and distribution of content across a variety of channels, including theatrical, home entertainment, television and online video-on-demand, and sponsorship arrangements. Operating segments that are not separately reportable are categorized in "All Other." Segment performance is evaluated based on revenues and segment gross profit. The Company does not allocate assets to each of its operating segments, nor do the Company's chief operating decision makers evaluate operating segments using discrete asset information. The Company's Ultimate Revenues for each film or television series/specials title include revenues attributable to the consumer products market. Prior to January 1, 2016, the Company allocated a portion of the amortization of capitalized film and television series/specials cost to the Consumer Products segment based on the proportion of revenues generated in the consumer products market in relation to total revenues for that title for any given period. Beginning January 1, 2016, the Company changed the method in which intellectual property costs are charged to the Consumer Products segment. As a result, effective January 1, 2016, amortization of capitalized production costs are no longer shared and allocated with the Consumer Products segment from the originating segment (Feature Films or Television Series and Specials). Instead, the Consumer Products segment is charged a royalty fee for use of intellectual property developed by other segments. The royalty fee is based on an established percentage applied against consumer products revenues earned by a particular property and is reflected as intersegment revenues in each of the impacted segments. Ultimate Revenues and the amortization of capitalized production costs remain unchanged as this change only relates to the method by which costs are allocated to the Consumer Products segment. Information on the reportable segments and a reconciliation of total segment revenues and segment gross profit to consolidated financial statements are presented below (in thousands): Three Months Ended March 31, 2016 2015 (1) Revenues Feature Films Third parties $ 94,058 $ 128,020 Intersegment 255 669 Total Feature Films segment revenues 94,313 128,689 Television Series and Specials Third parties 56,880 18,013 Intersegment 110 110 Total Television Series and Specials segment revenues 56,990 18,123 Three Months Ended March 31, 2016 2015 (1) Consumer Products Third parties 21,743 15,116 Intersegment (365 ) (779 ) Total Consumer Products segment revenues 21,378 14,337 New Media 15,228 4,583 All Other 2,533 798 Total consolidated revenues $ 190,442 $ 166,530 Segment gross profit (2) Feature Films $ 26,112 $ 38,092 Television Series and Specials 21,066 3,461 Consumer Products 14,992 9,413 New Media 6,513 2,115 All Other 1,485 495 Total segment gross profit $ 70,168 $ 53,576 Reconciliation to consolidated income (loss) before income taxes: Selling and marketing expenses (3) 490 1,686 General and administrative expenses 60,250 89,142 Product development expenses 545 332 Other operating income (4,941 ) (2,281 ) Non-operating expenses, net 3,095 11,825 (Income) loss from equity method investees (2,542 ) 6,362 Total consolidated income (loss) before income taxes $ 13,271 $ (53,490 ) ____________________ (1) Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. (2) The Company defines segment gross profit as segment revenues less segment costs of revenues (which is comprised of costs of revenues and certain costs classified as a component of "selling and marketing" in its statements of operations). (3) Represents certain selling and marketing expenses that are not included as a component of segment gross profit due to the general nature of such expenses. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Transactions with ODW. During the three months ended March 31, 2016 and 2015 , the Company had various transactions with a related party, ODW. See Note 6 for further discussion related to these transactions. Transactions with Universal Music Group. One of the Company's directors, Lucian Grainge, is the chief executive officer of Universal Music Group ("UMG"). From time to time, the Company and UMG (including its subsidiaries) make payments to each other in connection with the licensing of music that is owned by the other company. In addition, UMG serves as the Company's music publisher. Finally, UMG and ATV have formed joint ventures related to the music business. For the three months ended March 31, 2016 , revenues from UMG were $1.6 million . Revenues for the three months ended March 31, 2015 and expenses incurred for the three months ended March 31, 2016 and 2015, as it relates to UMG, were immaterial. As of March 31, 2016 and December 31, 2015 , the Company's deferred revenue and other advances (see Note 8) included the balance of a cash advance received in the amount of $3.3 million and $4.3 million , respectively, related to music licensing revenues. Transactions with Vessel. One of the Company's directors, Jason Kilar, is the chief executive officer and a significant stockholder in Vessel, a start-up subscription Internet video service company. Vessel has entered into (and is expected to continue to enter into) content and referral agreements with clients of ATV. The agreements in effect provide for certain minimum payments to ATV clients, with additional payments depending on applicable advertising and subscription revenues. Although ATV is not a party to these agreements, it will receive a percentage of the amounts paid to its clients under the terms of its arrangements with its individual clients. During the three months ended March 31, 2016 and 2015 , amounts received under these arrangements were immaterial. |
Concentrations of Credit Risk
Concentrations of Credit Risk | 3 Months Ended |
Mar. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Concentrations of Credit Risk | Concentrations of Credit Risk A substantial portion of the Company's revenue is derived directly from the Company's primary third-party distributors, Fox and Paramount. Fox represented approximately 23% and 26% of total revenues for the three-month periods ended March 31, 2016 and 2015 , respectively. As it relates to the three-month periods ended March 31, 2016 and 2015 , Paramount represented approximately 11% of total revenues for each respective period. In addition, during the three months ended March 31, 2016 and 2015 , 26% and 44% , respectively, of the Company's revenues were earned through license arrangements with Netflix, Inc. ("Netflix"). As of each of March 31, 2016 and December 31, 2015 , approximately 66% of the Company's trade accounts receivable balance consisted of long-term receivables related to licensing arrangements with Netflix. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings Shareholder Class Action Lawsuit. In August 2014, two putative shareholder class action lawsuits alleging violations of federal securities laws were filed against the Company and several of its officers and directors in the U.S. District Court for the Central District of California. These lawsuits have been consolidated and generally assert that, between October 29, 2013 and July 29, 2014, the Company and certain of its officers and directors made alleged material misstatements and omissions regarding the financial performance of Turbo . The consolidated lawsuit seeks to recover damages on behalf of shareholders as well as other equitable and unspecified monetary relief. On April 1, 2015, the court granted the Company's motion to dismiss the consolidated securities class action lawsuit and the case was dismissed with prejudice on May 19, 2015. The plaintiffs filed a notice of appeal on June 18, 2015, and the matter currently is pending before the United States Court of Appeals for the Ninth Circuit. The Company intends to vigorously defend against this consolidated lawsuit. At this time the Company is unable to reasonably predict the ultimate outcome of this consolidated lawsuit, nor can it reasonably estimate a range of possible loss. Antitrust Class Action. In September and October 2014, three putative class action lawsuits alleging violations of federal and state antitrust laws were filed against the Company and various other companies in the U.S. District Court for the Northern District of California. These lawsuits have been consolidated and generally assert that the defendants agreed to restrict competition through non-solicitation agreements and agreements to fix wage and salary ranges. The lawsuits seek to recover damages on behalf of all animation and visual effect workers employed by the defendants during various periods between 2001 and 2010. The Company intends to vigorously defend against these lawsuits. At this time the Company is unable to reasonably predict the ultimate outcome of these lawsuits, nor can it reasonably estimate a range of possible loss. Other Legal Matters. From time to time, the Company is involved in legal proceedings arising in the ordinary course of its business, typically intellectual property litigation and infringement claims related to the Company's feature films and other commercial activities, which could cause the Company to incur significant expenses or prevent the Company from releasing a film or other properties. The Company also has been the subject of patent and copyright claims relating to technology and ideas that it may use or feature in connection with the production, marketing or exploitation of the Company's feature films and other properties, which may affect the Company's ability to continue to do so. Furthermore, from time to time the Company may introduce new products or services, including in areas where it currently does not operate, which could increase its exposure to litigation and claims by competitors, consumers or other intellectual property owners. Defending intellectual property litigation is costly and can impose a significant burden on management and employees, and there can be no assurances that favorable final outcomes will be obtained in all cases. While the resolution of these matters cannot be predicted with certainty, the Company does not believe, based on current knowledge, that any existing legal proceedings or claims (other than those previously described) are likely to have a material effect on its financial position, results of operations or cash flows. Other Commitments and Contingencies Contributions to ODW . The Company has committed to making certain contributions in connection with the formation of ODW. Refer to Note 6 for further discussion related to these commitments. Purchase Obligations. During the year ended December 31, 2015, the Company entered into an agreement with one of its suppliers which committed the Company to minimum purchase obligations of certain capital assets intended to be resold in connection with one of the Company's Consumer Products segment activities. As of March 31, 2016 , remaining minimum purchase obligations totaled $11.7 million and are contractually due in 2016. Prior to resale, in the Company's consolidated balance sheets, these assets are included in prepaid expenses to the extent that advance deposits have been made for such assets (as of March 31, 2016, this amount was $6.3 million ), or in other assets to the extent that the Company has received the asset from its supplier (as of March 31, 2016 , this amount was $12.0 million ). Similar to other asset balances, the Company evaluates these assets for impairment on an annual basis, or sooner, if indicators of impairment exist. In the event that the Company determines that the assets' fair value is less than the carrying value, the Company would be required to record an impairment charge with respect to the assets. |
Earnings Per Share Data
Earnings Per Share Data | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share Data | Earnings Per Share Data The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share amounts): Three Months Ended March 31, 2016 2015 Numerator: Net income (loss) attributable to DreamWorks Animation SKG, Inc. $ 13,836 $ (54,777 ) Denominator: Weighted average common shares and denominator for basic calculation: Weighted average common shares outstanding 86,443 85,734 Less: Unvested restricted stock (45 ) (119 ) Denominator for basic calculation 86,398 85,615 Weighted average effects of dilutive stock-based compensation awards: Restricted stock awards 1,281 — Denominator for diluted calculation 87,679 85,615 Net income (loss) per share—basic $ 0.16 $ (0.64 ) Net income (loss) per share—diluted $ 0.16 $ (0.64 ) The following table sets forth (in thousands) the weighted average number of options to purchase shares of common stock, stock appreciation rights, restricted stock awards and equity awards subject to performance conditions which were not included in the calculation of diluted per share amounts because the effects would be anti-dilutive: Three Months Ended March 31, 2016 2015 (1) Restricted stock awards 380 1,135 ____________________ (1) Due to the Company's loss for the three-month period ended March 31, 2015, all potential common stock equivalents are anti-dilutive. The following table sets forth (in thousands) the number of equity awards that are contingently issuable (assuming the required performance conditions had been satisfied as of the dates shown in the table) and that could potentially dilute earnings per share in future periods provided that the Company has net income: Three Months Ended March 31, 2016 2015 Restricted stock awards 677 1,372 |
Restructuring and Related Charg
Restructuring and Related Charges | 3 Months Ended |
Mar. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Charges | Restructuring and Related Charges 2015 Restructuring Plan On January 22, 2015, the Company announced its restructuring initiatives (the "2015 Restructuring Plan") that are intended to refocus the Company's core feature animation business. In connection with the 2015 Restructuring Plan, the Company made changes in its senior leadership team and also made changes based on its reevaluation of the Company's feature film slate. The 2015 Restructuring Plan activities resulted, or will result, in charges related to employee-related costs resulting from headcount reductions, lease obligations and other costs associated with the closure of one of the Company's facilities, accelerated depreciation and amortization charges, write-offs related to the recoverability of capitalized costs for certain unreleased productions and other contractual obligations. Certain of these costs were incurred during the three months ended December 31, 2014 and the remainder of the costs were primarily incurred during the year ended December 31, 2015. As of March 31, 2016, the Company expected that it would incur aggregate costs of $241.3 million in connection with the 2015 Restructuring Plan (excluding additional labor and other excess costs) of which $240.0 million had been incurred through March 31, 2016. The actions associated with the restructuring plan primarily impacted the Feature Films segment and were substantially completed during 2015. Impact to Financial Results For the three months ended March 31, 2016 and 2015 , the Company incurred charges for the Company's 2015 Restructuring Plan as follows (in thousands): Three Months Ended March 31, 2016 2015 Employee termination costs $ (670 ) $ 4,587 Relocation and other employee-related costs 256 1,496 Accelerated depreciation and amortization charges — 9,279 Total restructuring charges $ (414 ) $ 15,362 Employee termination costs consist of severance and benefits (including stock-based compensation) which are accounted for based on the type of employment arrangement between the Company and the employee. Certain of these arrangements include obligations that are accounted for as non-retirement postemployment benefits. The Company also employs individuals under employment contracts. Charges related to non-retirement postemployment benefits and amounts due under employment contracts for employees who will no longer provide services are accrued when probable and estimable. Severance and benefit costs related to all other employees are accounted for in accordance with accounting guidance on costs associated with exit or disposal activities. Such costs were recorded during the year ended December 31, 2015 as this was the period in which the terms of the restructuring plan had been established, management with the appropriate authority committed to the plan and communication to employees had occurred. Such costs are classified in general and administrative expenses in the Company's consolidated statements of operations. Cumulative employee termination costs related to the 2015 Restructuring Plan were attributable to approximately 500 employees. Relocation and other employee-related costs primarily consist of costs to relocate employees from the Company's Northern California facility to its Southern California facility. Such costs are expensed as incurred and are classified within general and administrative expenses. Accelerated depreciation and amortization charges for the 2015 Restructuring Plan were determined in accordance with FASB guidance on accounting for the impairment or disposal of long-lived assets. The estimated useful lives of certain property, plant and equipment changed as a result of the Company's decision to exit its Northern California facility. Such costs are classified within general and administrative expenses. Liability Rollforward The following table represents a rollforward of the liability incurred for employee termination benefits (excluding stock-based compensation) in connection with the 2015 Restructuring Plan for the three- month periods ended March 31, 2016 and 2015 (in thousands): Balance at Beginning of Year Costs Incurred Changes in Estimate (1) Payments and Other Balance at March 31 2016 $ 11,969 $ — $ (670 ) $ (4,415 ) $ 6,884 2015 $ 36,808 $ 10,286 $ (5,036 ) $ (6,568 ) $ 35,490 ____________________ (1) During the three months ended March 31, 2016, changes in estimate were primarily a result of the Company's ability to reduce severance payments to former employees who obtain subsequent employment during their respective severance periods. During the three months ended March 31, 2015, changes in estimate were primarily a result of a higher number of employees accepting relocation offers than the Company initially estimated. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On April 5, 2016, the Company entered into a Unit Purchase Agreement (the “Purchase Agreement”) with ATV, Hearst and Verizon. Pursuant to the Purchase Agreement, upon closing Verizon will acquire from the Company and ATV a 24.5% equity interest in ATV for a purchase price of $159.0 million , and Hearst will acquire from ATV additional equity interests in ATV to maintain a 24.5% equity interest. Following this transaction, the Company's equity interest in ATV will be reduced to 51.0% . The Company will continue to consolidate the results of ATV as it will continue to retain control over the operations of ATV. The transaction is subject to a number of customary closing conditions. The Company currently expects that the closing of the transaction will be completed during the second or third quarters of 2016. Upon closing, the Company expects that it will receive $168.0 million of aggregate gross proceeds from Verizon and Hearst, which has not been reduced for direct transaction costs. |
Business and Basis of Present26
Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation | Consolidation The consolidated financial statements of the Company present the financial position, results of operations and cash flows of DreamWorks Animation and its wholly-owned and majority-owned subsidiaries. The Company also consolidates less-than-wholly owned entities if the Company has a controlling financial interest in that entity. The Company uses the equity method of accounting for investments in companies in which it has a 50% or less ownership interest and has the ability to exercise significant influence. Such investments are presented as investments in unconsolidated entities on the Company's consolidated balance sheets (refer to Note 6 for further information of such investments). Prior to recording its share of net income or losses from equity method investees, investee financial statements are converted to U.S. GAAP. All significant intercompany accounts and transactions have been eliminated. Intra-entity profit related to transactions with equity method investees is eliminated until the amounts are ultimately realized. |
Consolidation, Variable Interest Entity | In addition, the Company reviews its relationships with other entities to identify whether they are variable interest entities ("VIE") as defined by the Financial Accounting Standards Board ("FASB"), and to assess whether the Company is the primary beneficiary of such entity. If the determination is made that the Company is the primary beneficiary, then the entity is consolidated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The most significant estimates made by management in the preparation of the financial statements relate to the following: • ultimate revenues and ultimate costs of film and television product; • relative selling price of the Company's products for purposes of revenue allocation in multi-property licenses and other multiple deliverable arrangements; • determination of the fair value of reporting units for purposes of testing goodwill for impairment; • determination of fair value of non-cash contributions to investments in unconsolidated entities; • useful lives of intangible assets; • product sales that will be returned and the amount of receivables that ultimately will be collected; • the potential outcome of future tax consequences of events that have been recognized in the Company's financial statements; • loss contingencies; and • assumptions used in the determination of the fair value of equity-based awards for stock-based compensation or their probability of vesting. Actual results could differ from those estimates. To the extent that there are material differences between these estimates and actual results, the Company's financial condition or results of operations will be affected. Estimates are based on past experience and other assumptions that management believes are reasonable under the circumstances, and management evaluates these estimates on an ongoing basis. |
Recent accounting pronouncements | Recent Accounting Pronouncements In March 2016, the FASB issued an accounting standards update to simplify certain provisions related to the accounting for stock-based compensation. First, the guidance requires the income tax effects of stock-based compensation awards to be recognized in the income statement when the awards vest or are settled and is to be applied on a prospective basis. The guidance also requires the presentation of excess tax benefits as an operating activity on the statements of cash flows rather than as a financing activity, and this presentation can be applied retrospectively or prospectively. The guidance also increases the amount companies can withhold to cover income taxes on awards without triggering liability classification for shares used to satisfy statutory income tax withholding obligations and requires application of a modified retrospective transition method for this provision. Lastly, the new guidance allows the Company to make an entity-wide election to either continue estimating the number of awards that are expected to vest or account for forfeitures as they occur. The guidance is effective for the Company’s fiscal years beginning January 1, 2017, including interim periods within that fiscal year, with early adoption permitted. However, all provisions would need to be adopted in the same period. The Company is in the process of evaluating the impact that the new standard will have on its consolidated financial statements. In February 2016, the FASB issued an accounting standards update to increase transparency and comparability among companies by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Once it becomes effective, the new guidance will replace existing lease accounting guidance in U.S. GAAP. Under the new standard, lessees will recognize in its balance sheets a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. The guidance is effective for the Company's fiscal year beginning January 1, 2019, including interim periods within that fiscal year, with early adoption permitted. Companies are required to apply the guidance in the year of adoption with the cumulative effect recognized at the date of initial application (referred to as the modified retrospective approach). The Company is in the process of evaluating the impact that the new standard will have on its consolidated financial statements. In April 2015, the FASB issued an accounting standards update relating to the presentation of debt issuance costs. The accounting update requires companies to present debt issuance costs related to a recognized debt liability presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In addition, in August 2015, the FASB issued an accounting standards update to incorporate an SEC staff announcement that the SEC staff will not object to an entity presenting debt issuance costs related to line-of-credit arrangements as an asset regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The guidance is effective for the Company's fiscal year beginning January 1, 2016. The Company adopted the new guidance effective January 1, 2016. As a result, the Company now presents deferred financing costs associated with its senior unsecured notes as a deduction to the debt liability. In addition, as the Company was required to adopt the guidance on a retrospective basis, the Company reclassified amounts in its December 31, 2015 balance sheet to conform to the current period presentation. See Note 9 for further information related to the amounts presented as a deduction to the liability. As it relates to the Company's revolving credit facility, the associated deferred financing costs will continue to be presented within other assets. In February 2015, the FASB issued an accounting standards update to amend existing guidance relating to the evaluation of certain legal entities for potential consolidation. The amendments modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities. In addition, the amendments modify the guidance on evaluating whether a fee paid to a decision maker or a service provider represents a variable interest and whether it should be included in the evaluation of the economics criterion in determining which party is the primary beneficiary of a VIE. In accordance with the accounting standards update, companies are required to reevaluate all legal entities that are considered VIEs to determine whether there is a change in the conclusion as to whether the VIE should be consolidated. The guidance is effective for the Company's fiscal year beginning January 1, 2016, with early adoption permitted. The Company adopted the new guidance effective January 1, 2016. The adoption of this guidance did not change the Company's existing conclusions related to its VIEs and voting interest entities and, as a result, the adoption did not have an impact to the Company's consolidated financial statements. In May 2014, the FASB issued an accounting standards update to provide companies with a single model for use in accounting for revenue from contracts with customers. Once it becomes effective, the new guidance will replace most existing revenue recognition guidance in U.S. GAAP, including industry-specific guidance. The core principle of the model is to recognize revenue when control of goods or services transfers to the customer and in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods or services that have transferred. Under current U.S. GAAP, the Company recognizes revenue when the risks and rewards of ownership transfer to the customer. In addition, the new guidance requires improved disclosures to help users of financial statements better understand the nature, amount, timing and uncertainty of revenue that is recognized and the related cash flows. The guidance is effective for the Company's fiscal year beginning January 1, 2018, including interim periods within that fiscal year. Early adoption is permitted but no earlier than the Company's fiscal year beginning January 1, 2017. Companies are permitted to either apply the guidance retrospectively to all prior periods presented or, alternatively, apply the guidance in the year of adoption with the cumulative effect recognized at the date of initial application (referred to as the modified retrospective approach). The Company does not expect that it will early adopt this standard. The Company is in the process of concluding on the method of adoption, as well as evaluating the impact that the new standard will have on its consolidated financial statements. However, the Company currently expects that it will adopt the new guidance under the full retrospective approach. |
Fair Value of Financial Instruments | The fair value of cash and cash equivalents, accounts payable, advances and amounts outstanding under the revolving credit facility approximates carrying value due to the short-term maturity of such instruments and floating interest rates. As of March 31, 2016 , the fair value of trade accounts receivable approximated carrying value due to the similarities in the initial and current discount rates. In addition, as of March 31, 2016 , the fair value and the carrying value of the principal amount of the senior unsecured notes was $308.9 million and $300.0 million , respectively. The fair value of trade accounts receivable and the senior unsecured notes was determined using significant unobservable inputs by performing a discounted cash flow analysis and using current discount rates as appropriate for each type of instrument. The Company has short-term money market investments which are classified as cash and cash equivalents on the consolidated balance sheets. The fair value of these investments at March 31, 2016 and December 31, 2015 was measured based on quoted prices in active markets. |
Film and Other Inventory Costs
Film and Other Inventory Costs (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Film Costs [Abstract] | |
Film, television and other inventory costs | Film, television and other inventory costs consist of the following (in thousands): March 31, December 31, In release, net of amortization: Feature films $ 338,617 $ 227,372 Television series and specials 139,617 124,911 In production: Feature films 198,391 308,114 Television series and specials 41,896 50,810 In development: Feature films 102,706 99,541 Television series and specials 1,827 846 Product inventory and other (1) 9,364 8,860 Total film, television and other inventory costs, net $ 832,418 $ 820,454 _____________________ (1) As of March 31, 2016 and December 31, 2015 , this category included $6.9 million and $6.7 million , respectively, of physical inventory primarily related to certain titles for distribution in the home entertainment market. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of definite-lived assets | In addition, intangible assets included definite-lived intangible assets as follows (in thousands, unless otherwise noted): Weighted Average Estimated Useful Life (in years) Gross Accumulated Amortization Impact of Foreign Currency Translation Net As of March 31, 2016: Character rights 13.9 $ 99,000 $ (22,500 ) $ (3,701 ) $ 72,799 Distribution rights 11.2 30,000 (5,434 ) — 24,566 Trademarks and trade names 10.0 1,410 (391 ) — 1,019 Other intangibles 4.4 2,700 (1,381 ) — 1,319 Total $ 133,110 $ (29,706 ) $ (3,701 ) $ 99,703 As of December 31, 2015: Character rights 13.9 $ 99,000 $ (21,150 ) $ (2,734 ) $ 75,116 Distribution rights 11.2 30,000 (4,671 ) — 25,329 Trademarks and trade names 10.0 1,410 (356 ) — 1,054 Other intangibles 4.4 2,700 (1,271 ) — 1,429 Total $ 133,110 $ (27,448 ) $ (2,734 ) $ 102,928 |
Investments in Unconsolidated29
Investments in Unconsolidated Entities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Investments in Unconsolidated Entities [Abstract] | |
Schedule of cost and equity method investments | These investments are classified as investments in unconsolidated entities in the consolidated balance sheets and consist of the following (in thousands, unless otherwise indicated): Ownership Percentage at March 31, December 31, March 31, 2016 2016 2015 Oriental DreamWorks Holding Limited 45.45% $ 23,409 $ 16,814 Total equity method investments 23,409 16,814 Total cost method investments 16,000 16,000 Total investments in unconsolidated entities $ 39,409 $ 32,814 |
Schedule of losses from equity method investments | Income (loss) from equity method investees consist of the following (in thousands): Three Months Ended March 31, 2016 2015 Oriental DreamWorks Holding Limited (1) $ 2,542 $ (5,398 ) All Other — (964 ) Income (loss) from equity method investees $ 2,542 $ (6,362 ) ____________________ (1) The Company currently records its share of ODW results on a one-month lag. Accordingly, the Company's consolidated financial statements include its share of income earned or losses incurred by ODW from the period beginning and ending one month prior to the period shown in the table. |
Schedule of equity method investment information | The following table presents summarized financial information for ODW (in thousands): March 31, December 31, 2016 2015 Current assets $ 92,742 $ 49,427 Noncurrent assets $ 74,056 $ 73,340 Current liabilities $ 64,834 $ 28,114 Noncurrent liabilities $ 156 $ 233 Three Months Ended March 31, 2016 2015 Revenues $ 60,249 $ 2,618 Costs of revenues $ 50,200 $ 2,707 Net income (loss) $ 5,100 $ (12,576 ) The following are the differences between the Company's venture-level equity and the balance of its investment in ODW (in thousands): March 31, December 31, 2016 2015 Company's venture-level equity $ 46,272 $ 42,914 Technology and intellectual property licenses (1) (2,916 ) (6,833 ) Other (2) (19,947 ) (19,267 ) Total ODW investment recorded $ 23,409 $ 16,814 ____________________ (1) Represents differences between the Company's historical cost basis and the equity basis reflected at the venture-level (the amount recorded on the balance sheet of ODW) related to the Company's contributions of technology and intellectual property licenses. These basis differences arise because the contributed assets are recorded at fair value by ODW. (2) Represents the Company's net contribution commitment due to ODW. |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities | Accrued liabilities consist of the following (in thousands): March 31, December 31, 2016 2015 Employee compensation $ 35,217 $ 85,616 Participations and residuals 49,855 46,562 Interest payable 2,838 8,069 Deferred rent 10,589 10,446 Other accrued liabilities 52,430 48,972 Total accrued liabilities $ 150,929 $ 199,665 |
Deferred Revenue and Other Ad31
Deferred Revenue and Other Advances (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Deferred Revenue Disclosure [Abstract] | |
Summary of deferred revenue and other advances included in the consolidated balance sheets | The following is a summary of deferred revenue and other advances included in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 and the related amounts earned and recorded either as revenue in the consolidated statements of operations or recorded as an offset to other costs (as described below) for the three- month periods ended March 31, 2016 and 2015 (in thousands): Amounts Earned Three Months Ended March 31, December 31, March 31, 2016 2015 2016 2015 Deferred Revenue (1) $ 16,710 $ 25,035 $ 13,074 $ 118 Strategic Alliance/Development Advances (2) 5,143 1,826 2,614 7,684 Other (3) 50,755 47,798 18,835 14,547 Total deferred revenue and other advances $ 72,608 $ 74,659 ______________________ (1) "Deferred revenue" consists of those arrangements related to the licensing of content for distribution in the home entertainment, television and new media markets. (2) Of the total amounts earned against the "Strategic Alliance/Development Advances," for the three months ended March 31, 2016 and 2015 , $0.4 million and $4.0 million , respectively, were capitalized as an offset to property, plant and equipment. Additionally, during the three months ended March 31, 2016 and 2015 , $0.2 million and $0.9 million , respectively, were recorded as a reduction to prepaid expenses. Lastly, during the three months ended March 31, 2016 and 2015 , of the total amounts earned, $0.4 million and $0.6 million , respectively, were recorded as a reduction to operating expenses. (3) "Other" consists of all remaining arrangements that result in deferred revenue or other advances and are related to a variety of activities that result in amounts being earned to either revenues or other income. |
Financing Arrangements (Tables)
Financing Arrangements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of financing arrangements | Senior unsecured notes, net of deferred financing costs, as presented on the Company's consolidated balance sheets consist of the following (in thousands): March 31, December 31, 2016 2015 Senior unsecured notes, principal balance $ 300,000 $ 300,000 Less: unamortized deferred financing costs (4,601 ) (4,866 ) Senior unsecured notes, net of deferred financing costs $ 295,399 $ 295,134 |
Stockholders' Equity and Non-33
Stockholders' Equity and Non-Controlling Interests (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of stockholders equity and non-controlling interest | The following table presents the changes in equity for the three- month periods ended March 31, 2016 and 2015 (in thousands): DreamWorks Animation SKG, Inc. Stockholders' Equity Non-Controlling Interests Total Equity Balance as of December 31, 2015 $ 1,143,517 $ 55,323 $ 1,198,840 Stock-based compensation 7,332 — 7,332 Purchase of treasury shares (3,603 ) — (3,603 ) Foreign currency translation adjustments (823 ) — (823 ) Distributions to non-controlling interest holder — (206 ) (206 ) Net income (loss) 13,836 (1,695 ) 12,141 Balance as of March 31, 2016 $ 1,160,259 $ 53,422 $ 1,213,681 Balance as of December 31, 2014 $ 1,156,357 $ 38,041 $ 1,194,398 Stock-based compensation 6,780 — 6,780 Purchase of treasury shares (2,013 ) — (2,013 ) Foreign currency translation adjustments (810 ) — (810 ) DreamWorks Animation SKG, Inc. Stockholders' Equity Non-Controlling Interests Total Equity Capital contribution from non-controlling interest holder — 15,000 15,000 Distributions to non-controlling interest holder — (571 ) (571 ) Net loss (54,777 ) (1,113 ) (55,890 ) Balance as of March 31, 2015 $ 1,105,537 $ 51,357 $ 1,156,894 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of impact of stock-based compensation awards on net income | The impact of stock-based compensation awards on net income (excluding amounts capitalized) for the three- month periods ended March 31, 2016 and 2015 were as follows (in thousands): Three Months Ended March 31, 2016 2015 Total stock-based compensation $ 4,861 $ 4,399 Tax impact (1) (413 ) 198 Reduction in net income, net of tax $ 4,448 $ 4,597 ____________________ (1) Tax impact was determined at the Company's combined effective tax rate, which includes the statements of operations line item "Increase in income tax benefit payable to former stockholder" (see Note 10). |
Schedule of number and weighted average grant date fair value of equity awards granted | The following table sets forth the number and weighted average grant-date fair value of equity awards granted during the three- month periods ended March 31, 2016 and 2015 : Three Months Ended March 31, Number Granted Weighted Average Grant-Date Fair Value (in thousands) 2016 Restricted stock units 305 $ 24.90 2015 Restricted stock units 777 $ 21.41 |
Reportable Segments (Tables)
Reportable Segments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | Information on the reportable segments and a reconciliation of total segment revenues and segment gross profit to consolidated financial statements are presented below (in thousands): Three Months Ended March 31, 2016 2015 (1) Revenues Feature Films Third parties $ 94,058 $ 128,020 Intersegment 255 669 Total Feature Films segment revenues 94,313 128,689 Television Series and Specials Third parties 56,880 18,013 Intersegment 110 110 Total Television Series and Specials segment revenues 56,990 18,123 Three Months Ended March 31, 2016 2015 (1) Consumer Products Third parties 21,743 15,116 Intersegment (365 ) (779 ) Total Consumer Products segment revenues 21,378 14,337 New Media 15,228 4,583 All Other 2,533 798 Total consolidated revenues $ 190,442 $ 166,530 Segment gross profit (2) Feature Films $ 26,112 $ 38,092 Television Series and Specials 21,066 3,461 Consumer Products 14,992 9,413 New Media 6,513 2,115 All Other 1,485 495 Total segment gross profit $ 70,168 $ 53,576 Reconciliation to consolidated income (loss) before income taxes: Selling and marketing expenses (3) 490 1,686 General and administrative expenses 60,250 89,142 Product development expenses 545 332 Other operating income (4,941 ) (2,281 ) Non-operating expenses, net 3,095 11,825 (Income) loss from equity method investees (2,542 ) 6,362 Total consolidated income (loss) before income taxes $ 13,271 $ (53,490 ) ____________________ (1) Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. (2) The Company defines segment gross profit as segment revenues less segment costs of revenues (which is comprised of costs of revenues and certain costs classified as a component of "selling and marketing" in its statements of operations). (3) Represents certain selling and marketing expenses that are not included as a component of segment gross profit due to the general nature of such expenses. |
Earnings Per Share Data (Tables
Earnings Per Share Data (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted net income per share | The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share amounts): Three Months Ended March 31, 2016 2015 Numerator: Net income (loss) attributable to DreamWorks Animation SKG, Inc. $ 13,836 $ (54,777 ) Denominator: Weighted average common shares and denominator for basic calculation: Weighted average common shares outstanding 86,443 85,734 Less: Unvested restricted stock (45 ) (119 ) Denominator for basic calculation 86,398 85,615 Weighted average effects of dilutive stock-based compensation awards: Restricted stock awards 1,281 — Denominator for diluted calculation 87,679 85,615 Net income (loss) per share—basic $ 0.16 $ (0.64 ) Net income (loss) per share—diluted $ 0.16 $ (0.64 ) |
Weighted average number of options used to purchase shares of common stock, stock appreciation rights, restricted stock awards and equity awards | The following table sets forth (in thousands) the weighted average number of options to purchase shares of common stock, stock appreciation rights, restricted stock awards and equity awards subject to performance conditions which were not included in the calculation of diluted per share amounts because the effects would be anti-dilutive: Three Months Ended March 31, 2016 2015 (1) Restricted stock awards 380 1,135 ____________________ (1) Due to the Company's loss for the three-month period ended March 31, 2015, all potential common stock equivalents are anti-dilutive. |
Number of equity awards that are contingently issuable | The following table sets forth (in thousands) the number of equity awards that are contingently issuable (assuming the required performance conditions had been satisfied as of the dates shown in the table) and that could potentially dilute earnings per share in future periods provided that the Company has net income: Three Months Ended March 31, 2016 2015 Restricted stock awards 677 1,372 |
Restructuring and Related Cha37
Restructuring and Related Charges (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of restructuring and related charges | For the three months ended March 31, 2016 and 2015 , the Company incurred charges for the Company's 2015 Restructuring Plan as follows (in thousands): Three Months Ended March 31, 2016 2015 Employee termination costs $ (670 ) $ 4,587 Relocation and other employee-related costs 256 1,496 Accelerated depreciation and amortization charges — 9,279 Total restructuring charges $ (414 ) $ 15,362 The following table represents a rollforward of the liability incurred for employee termination benefits (excluding stock-based compensation) in connection with the 2015 Restructuring Plan for the three- month periods ended March 31, 2016 and 2015 (in thousands): Balance at Beginning of Year Costs Incurred Changes in Estimate (1) Payments and Other Balance at March 31 2016 $ 11,969 $ — $ (670 ) $ (4,415 ) $ 6,884 2015 $ 36,808 $ 10,286 $ (5,036 ) $ (6,568 ) $ 35,490 ____________________ (1) During the three months ended March 31, 2016, changes in estimate were primarily a result of the Company's ability to reduce severance payments to former employees who obtain subsequent employment during their respective severance periods. During the three months ended March 31, 2015, changes in estimate were primarily a result of a higher number of employees accepting relocation offers than the Company initially estimated. |
Business and Basis of Present38
Business and Basis of Presentation (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Apr. 28, 2016 | Dec. 11, 2014 | |
Hearst Corporation [Member] | Corporate Joint Venture [Member] | |||
Business Acquisition [Line Items] | |||
Equity interest in joint venture | 25.00% | ||
Fox [Member] | Distribution Arrangement [Member] | |||
Business Acquisition [Line Items] | |||
Distribution arrangement, output term | 5 years | ||
Period after U.S. home video release that output term will terminate | 1 year | ||
Paramount [Member] | Distribution Arrangement [Member] | |||
Business Acquisition [Line Items] | |||
Distribution arrangement, exploitation period | 16 years | ||
Subsequent Event [Member] | Dreamworks Animation [Member] | Comcast Corporation [Member] | |||
Business Acquisition [Line Items] | |||
Merger Agreement, converted price per share offered | $ 41 | ||
Merger Agreement, potential termination fee | $ 200,000,000 | ||
Dreamworks Animation [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | Subsequent Event [Member] | |||
Business Acquisition [Line Items] | |||
Merger agreement, potential termination fee | $ 152,000,000 |
Financial Instruments (Details)
Financial Instruments (Details) - Senior Unsecured Notes [Member] - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Senior unsecured notes, fair value | $ 308,900 | |
Senior unsecured notes, carrying value, principal amount | $ 300,000 | $ 300,000 |
Film and Other Inventory Cost40
Film and Other Inventory Costs (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Dec. 31, 2015 | ||
In release, net of amortization: | |||
Feature films | $ 338,617,000 | $ 227,372,000 | |
Television series and specials | 139,617,000 | 124,911,000 | |
In production: | |||
Feature films | 198,391,000 | 308,114,000 | |
Television series and specials | 41,896,000 | 50,810,000 | |
In development: | |||
Feature films | 102,706,000 | 99,541,000 | |
Television series and specials | 1,827,000 | 846,000 | |
Product inventory and other | [1] | 9,364,000 | 8,860,000 |
Total film, television and other inventory costs, net | 832,418,000 | 820,454,000 | |
Physical inventory | $ 6,900,000 | $ 6,700,000 | |
Release costs expected to be amortized over the next 12 months | 53.00% | ||
Release costs expected to be amortized over three years | 80.00% | ||
Film and other inventory costs impairment | $ 0 | ||
[1] | As of March 31, 2016 and December 31, 2015, this category included $6.9 million and $6.7 million, respectively, of physical inventory primarily related to certain titles for distribution in the home entertainment market. |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 69,400 | $ 69,400 |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross | 133,110 | 133,110 |
Accumulated amortization | (29,706) | (27,448) |
Impact of foreign currency translation | (3,701) | (2,734) |
Net | $ 99,703 | $ 102,928 |
Character Rights [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted average estimated useful life | 13 years 10 months 24 days | 13 years 10 months 24 days |
Gross | $ 99,000 | $ 99,000 |
Accumulated amortization | (22,500) | (21,150) |
Impact of foreign currency translation | (3,701) | (2,734) |
Net | $ 72,799 | $ 75,116 |
Distribution Rights [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted average estimated useful life | 11 years 2 months 12 days | 11 years 2 months 12 days |
Gross | $ 30,000 | $ 30,000 |
Accumulated amortization | (5,434) | (4,671) |
Impact of foreign currency translation | 0 | 0 |
Net | $ 24,566 | $ 25,329 |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted average estimated useful life | 10 years | 10 years |
Gross | $ 1,410 | $ 1,410 |
Accumulated amortization | (391) | (356) |
Impact of foreign currency translation | 0 | 0 |
Net | $ 1,019 | $ 1,054 |
Other Intangibles [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted average estimated useful life | 4 years 4 months 24 days | 4 years 4 months 24 days |
Gross | $ 2,700 | $ 2,700 |
Accumulated amortization | (1,381) | (1,271) |
Impact of foreign currency translation | 0 | 0 |
Net | $ 1,319 | $ 1,429 |
Investments in Unconsolidated42
Investments in Unconsolidated Entities (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2016 | Dec. 31, 2015 | Apr. 03, 2013 | |
Schedule of Cost and Equity Method Investments [Line Items] | ||||
Total equity method investments | $ 23,409,000 | $ 16,814,000 | ||
Total cost method investments | 16,000,000 | 16,000,000 | ||
Investments in unconsolidated entities | $ 39,409,000 | 32,814,000 | ||
Equity method investment, fair value | $ 0 | |||
Equity method investment, impairment charge | $ 5,100,000 | |||
ODW Holding Limited [Member] | ||||
Schedule of Cost and Equity Method Investments [Line Items] | ||||
Equity method investment, ownership percentage | 45.45% | 45.45% | ||
Total equity method investments | $ 23,409,000 | $ 16,814,000 |
Investments in Unconsolidated43
Investments in Unconsolidated Entities Loss From Equity Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | |||
Schedule of Income (Loss) From Equity Method Investments [Line Items] | ||||
Income (loss) from equity method investees | $ 2,542 | $ (6,362) | [1] | |
ODW Holding Limited [Member] | ||||
Schedule of Income (Loss) From Equity Method Investments [Line Items] | ||||
Income (loss) from equity method investees | [2] | 2,542 | (5,398) | |
All Other [Member] | ||||
Schedule of Income (Loss) From Equity Method Investments [Line Items] | ||||
Income (loss) from equity method investees | $ 0 | $ (964) | ||
[1] | Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. | |||
[2] | The Company currently records its share of ODW results on a one-month lag. Accordingly, the Company's consolidated financial statements include its share of income earned or losses incurred by ODW from the period beginning and ending one month prior to the period shown in the table. |
Investments in Unconsolidated44
Investments in Unconsolidated Entities Summarized Financial Information (Details) - ODW Holding Limited [Member] - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Schedule of Equity Method Investments [Line Items] | |||
Current assets | $ 92,742 | $ 49,427 | |
Noncurrent assets | 74,056 | 73,340 | |
Current liabilities | 64,834 | 28,114 | |
Noncurrent liabilities | 156 | $ 233 | |
Revenues | 60,249 | $ 2,618 | |
Costs of revenues | 50,200 | 2,707 | |
Net income (loss) | $ 5,100 | $ (12,576) |
Investments in Unconsolidated45
Investments in Unconsolidated Entities Basis Difference In Equity Investment (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | |
Schedule of Equity Method Investments [Line Items] | |||
Total investment recorded | $ 23,409 | $ 16,814 | |
ODW Holding Limited [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Company's venture-level equity | 46,272 | 42,914 | |
Total investment recorded | 23,409 | 16,814 | |
ODW Holding Limited [Member] | Technology and Intellectual Property Licenses [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Basis differences | [1] | (2,916) | (6,833) |
ODW Holding Limited [Member] | Other [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Basis differences | [2] | $ (19,947) | $ (19,267) |
[1] | Represents differences between the Company's historical cost basis and the equity basis reflected at the venture-level (the amount recorded on the balance sheet of ODW) related to the Company's contributions of technology and intellectual property licenses. These basis differences arise because the contributed assets are recorded at fair value by ODW. | ||
[2] | Represents the Company's net contribution commitment due to ODW. |
Investments in Unconsolidated46
Investments in Unconsolidated Entities Narrative (Details) $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2016USD ($)in-development_film_project | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Apr. 03, 2013USD ($) | ||
Investments in and Advances to Affiliates [Line Items] | |||||
Other operating income | $ 4,941 | $ 2,281 | [1] | ||
Revenues | 190,442 | 166,530 | [1] | ||
Trade accounts receivable, net of allowance for doubtful accounts | 253,803 | $ 271,466 | |||
Receivable from distributors, net of allowance for doubtful accounts | 240,846 | 230,569 | |||
ODW Holding Limited [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Trade accounts receivable, net of allowance for doubtful accounts | 6,600 | 4,700 | |||
Receivable from distributors, net of allowance for doubtful accounts | 20,500 | $ 1,100 | |||
ODW Holding Limited [Member] | Distribution Arrangement [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Revenues | $ 21,500 | 400 | |||
ODW Holding Limited [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Equity method investment, ownership percentage | 45.45% | 45.45% | |||
Equity method investment, cash contribution commitment | $ 50,000 | ||||
Cash contributions satisfied | $ 17,000 | ||||
Estimated aggregate value of non-cash contributions | $ 100,000 | ||||
Value of non-cash contributions satisfied | 49,100 | ||||
Remaining cash contribution commitment to be paid | $ 33,000 | ||||
Payment period for remaining cash contribution commitment | 2 years | ||||
Remaining number of in-development film projects | in-development_film_project | 2 | ||||
Value of consulting and training services rendered | $ 6,400 | ||||
ODW Holding Limited [Member] | Non-Cash Contributions [Member] | |||||
Investments in and Advances to Affiliates [Line Items] | |||||
Other operating income | 1,500 | $ 2,300 | |||
Revenues | $ 2,500 | ||||
[1] | Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Employee compensation | $ 35,217 | $ 85,616 |
Participations and residuals | 49,855 | 46,562 |
Interest payable | 2,838 | 8,069 |
Deferred rent | 10,589 | 10,446 |
Other accrued liabilities | 52,430 | 48,972 |
Total accrued liabilities | 150,929 | $ 199,665 |
Accrued participation and residual costs estimated to pay over the next 12 months | $ 24,400 |
Deferred Revenue and Other Ad48
Deferred Revenue and Other Advances (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | ||
Deferred Revenue And Other Advances By Category [Line Items] | ||||
Total deferred revenue and other advances | $ 72,608 | $ 74,659 | ||
Deferred Revenue [Member] | ||||
Deferred Revenue And Other Advances By Category [Line Items] | ||||
Total deferred revenue and other advances | [1] | 16,710 | 25,035 | |
Deferred revenue and other advances, amounts earned | [1] | 13,074 | $ 118 | |
Strategic Alliance/Development Advances [Member] | ||||
Deferred Revenue And Other Advances By Category [Line Items] | ||||
Total deferred revenue and other advances | [2] | 5,143 | 1,826 | |
Deferred revenue and other advances, amounts earned | [2] | 2,614 | 7,684 | |
Amount capitalized as offset to property, plant and equipment | 400 | 4,000 | ||
Amount capitalized as offset to prepaid expenses | 200 | 900 | ||
Amount recorded as an offset to operating expenses | 400 | 600 | ||
Other Advances [Member] | ||||
Deferred Revenue And Other Advances By Category [Line Items] | ||||
Total deferred revenue and other advances | [3] | 50,755 | $ 47,798 | |
Deferred revenue and other advances, amounts earned | [3] | $ 18,835 | $ 14,547 | |
[1] | Deferred revenue" consists of those arrangements related to the licensing of content for distribution in the home entertainment, television and new media markets. | |||
[2] | Of the total amounts earned against the "Strategic Alliance/Development Advances," for the three months ended March 31, 2016 and 2015, $0.4 million and $4.0 million, respectively, were capitalized as an offset to property, plant and equipment. Additionally, during the three months ended March 31, 2016 and 2015, $0.2 million and $0.9 million, respectively, were recorded as a reduction to prepaid expenses. Lastly, during the three months ended March 31, 2016 and 2015, of the total amounts earned, $0.4 million and $0.6 million, respectively, were recorded as a reduction to operating expenses. | |||
[3] | "Other" consists of all remaining arrangements that result in deferred revenue or other advances and are related to a variety of activities that result in amounts being earned to either revenues or other income. |
Financing Arrangements (Details
Financing Arrangements (Details) | Jul. 21, 2015USD ($) | Feb. 23, 2015USD ($)arenewal_termbuilding | Feb. 20, 2015USD ($) | Aug. 14, 2013USD ($) | Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Feb. 19, 2015USD ($) |
Debt Instrument [Line Items] | ||||||||
Proceeds from lease financing obligation | $ 0 | $ 185,000,000 | ||||||
Proceeds received from sale of property by third party | $ 14,200,000 | |||||||
Sales leaseback transaction, net book value of property, plant and equipment sold | 109,400,000 | |||||||
Deferred gain on sale-leaseback transaction | 88,500,000 | |||||||
Revolving credit facility, amount outstanding | 101,000,000 | $ 60,000,000 | ||||||
Senior unsecured notes, net of deferred financing costs | 295,399,000 | 295,134,000 | ||||||
Interest costs incurred | 6,700,000 | 8,500,000 | ||||||
Interest costs capitalized | $ 800,000 | $ 1,000,000 | ||||||
Senior Unsecured Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 300,000,000 | |||||||
Debt sold to investors, percentage of principal amount sold | 100.00% | |||||||
Proceeds from issuance of long-term debt | $ 294,000,000 | |||||||
Redemption price of principal amount due to change in control, percentage | 101.00% | |||||||
Debt instrument, percent redeemable, certain equity offerings | 35.00% | |||||||
Percentage of redeemable principal amount by Company | 106.875% | |||||||
Stated interest rate of debt | 6.875% | |||||||
Senior unsecured notes, principal balance | $ 300,000,000 | 300,000,000 | ||||||
Less: unamortized deferred financing costs | (4,601,000) | (4,866,000) | ||||||
Senior unsecured notes, net of deferred financing costs | 295,399,000 | $ 295,134,000 | ||||||
Line of Credit [Member] | Revolving Credit Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 400,000,000 | |||||||
Glendale, California Property [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of buildings sold | building | 10 | |||||||
Number of acres sold | a | 14.7 | |||||||
Proceeds from lease financing obligation | $ 185,000,000 | |||||||
Glendale Lease Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Lease financing obligation, initial annual rental payments | $ 13,200,000 | |||||||
Lease financing obligation, percentage of increase to annual rental payments | 1.50% | |||||||
Lease financing obligation, lease term | 20 years | |||||||
Lease financing obligation, number of consecutive renewal options available | renewal_term | 4 | |||||||
Lease financing obligation, renewal option term | 5 years | |||||||
Lease financing obligation, number of renewal terms subject to fixed rent increases | renewal_term | 2 | |||||||
Lease financing obligation, number of renewal terms subject to lease agreement terms | renewal_term | 2 | |||||||
Restated Credit Agreement [Member] | Line of Credit [Member] | Revolving Credit Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 450,000,000 | |||||||
Line of credit, maximum borrowing capacity, potential increase | $ 50,000,000 | |||||||
Remaining borrowing capacity | $ 349,000,000 | |||||||
Annual commitment fee on undrawn amounts of revolving credit facility | 0.375% | |||||||
Interest rate, rate spread over bank base rate | 1.50% | |||||||
Interest rate, rate spread over LIBOR | 2.50% | |||||||
Letter of credit, fronting fee | 0.125% | |||||||
Landlord [Member] | Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Sale price of property | $ 215,000,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Percentage the company is obligated to remit to an affiliate of the former significant stockholder | 85.00% | |
Provision for income taxes | $ 1,130 | $ 2,400 |
Effective tax rate | 8.50% | (4.50%) |
Increase in income tax benefit payable to former stockholder | $ 0 | $ (25) |
Effective tax rate combined with increase/decrease in income tax (benefit) provision to former stockholder | 8.50% | (4.50%) |
Statutory federal rate | 35.00% | 35.00% |
Stockholders' Equity and Non-51
Stockholders' Equity and Non-Controlling Interests (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Stockholders' Equity Note [Abstract] | ||
Value of shares authorized to be repurchased | $ 150,000,000 | |
Stock repurchase program, remaining authorized repurchase amount | 100,000,000 | |
Increase (Decrease) in Equity [Roll Forward] | ||
Total DreamWorks Animation SKG, Inc. stockholders’ equity, beginning of period | 1,143,517,000 | $ 1,156,357,000 |
Non-controlling interests, beginning of period | 55,323,000 | 38,041,000 |
Total equity, beginning of period | 1,198,840,000 | 1,194,398,000 |
Stock-based compensation | 7,332,000 | 6,780,000 |
Purchase of treasury shares | (3,603,000) | (2,013,000) |
Foreign currency translation adjustments | (823,000) | (810,000) |
Capital contribution from non-controlling interest holder | 15,000,000 | |
Distributions to non-controlling interest holder | (206,000) | (571,000) |
Net income (loss) attributable to DreamWorks Animation SKG, Inc. | 13,836,000 | (54,777,000) |
Less: Net loss attributable to non-controlling interests | (1,695,000) | (1,113,000) |
Net income (loss) | 12,141,000 | (55,890,000) |
Total DreamWorks Animation SKG, Inc. stockholders’ equity, end of period | 1,160,259,000 | 1,105,537,000 |
Non-controlling interests, end of period | 53,422,000 | 51,357,000 |
Total equity | $ 1,213,681,000 | $ 1,156,894,000 |
Stock-Based Compensation Narrat
Stock-Based Compensation Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Stock-based compensation, allocation of recognized period costs, capitalized amount | $ 2.4 | $ 2.3 |
Stock-based compensation, nonvested awards, total compensation cost not yet recognized | $ 63.8 | |
Stock-based compensation, nonvested awards, total compensation cost not yet recognized, period of recognition (in years) | 1 year 9 months 18 days |
Impact of Stock Options and Res
Impact of Stock Options and Restricted Stock Awards on Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Total stock-based compensation | $ 4,861 | $ 4,399 | |
Tax impact | [1] | (413) | 198 |
Reduction in net income, net of tax | $ 4,448 | $ 4,597 | |
[1] | Tax impact was determined at the Company's combined effective tax rate, which includes the statements of operations line item "Increase in income tax benefit payable to former stockholder" (see Note 10). |
Number and Weighted Average Gra
Number and Weighted Average Grant Date Fair Value of Equity Awards Granted (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Number of shares granted | 305 | 777 |
Weighted average grant date fair value (in dollars per share) | $ 24.90 | $ 21.41 |
Reportable Segments (Details)
Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2016 | Mar. 31, 2015 | [1] | |||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 190,442 | $ 166,530 | |||
Total segment gross profit | [2] | 70,168 | 53,576 | ||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | |||||
Selling and marketing | [3] | 490 | 1,686 | ||
General and administrative | 60,250 | 89,142 | |||
Product development | 545 | 332 | |||
Other Operating Income | (4,941) | (2,281) | |||
Non-operating expenses, net | 3,095 | 11,825 | |||
(Income) loss from equity method investees | (2,542) | 6,362 | |||
Income (loss) before income taxes | 13,271 | (53,490) | |||
Feature Films [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 94,313 | 128,689 | |||
Total segment gross profit | 26,112 | [2] | 38,092 | ||
Television Series and Specials [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 56,990 | 18,123 | |||
Total segment gross profit | 21,066 | [2] | 3,461 | ||
Consumer Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 21,378 | 14,337 | |||
Total segment gross profit | 14,992 | [2] | 9,413 | ||
New Media [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total segment gross profit | [2] | 6,513 | 2,115 | ||
All Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total segment gross profit | [2] | 1,485 | 495 | ||
Third Parties [Member] | Feature Films [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 94,058 | 128,020 | |||
Third Parties [Member] | Television Series and Specials [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 56,880 | 18,013 | |||
Third Parties [Member] | Consumer Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 21,743 | 15,116 | |||
Third Parties [Member] | New Media [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 15,228 | 4,583 | |||
Third Parties [Member] | All Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 2,533 | 798 | |||
Intersegment [Member] | Feature Films [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 255 | 669 | |||
Intersegment [Member] | Television Series and Specials [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 110 | 110 | |||
Intersegment [Member] | Consumer Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | $ (365) | $ (779) | |||
[1] | Reflects reclassifications between segments to conform to the current period methodology in allocating costs to the Consumer Products segment as previously discussed. | ||||
[2] | The Company defines segment gross profit as segment revenues less segment costs of revenues (which is comprised of costs of revenues and certain costs classified as a component of "selling and marketing" in its statements of operations). | ||||
[3] | Represents certain selling and marketing expenses that are not included as a component of segment gross profit due to the general nature of such expenses. |
Related Party Transactions (Det
Related Party Transactions (Details) - UMG [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | ||
Revenue from Related Parties | $ 1.6 | |
Related party transaction, cash advance received | $ 3.3 | $ 4.3 |
Concentrations of Credit Risk (
Concentrations of Credit Risk (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Fox [Member] | Revenues [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 23.00% | 26.00% | |
Paramount [Member] | Revenues [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 11.00% | 11.00% | |
Netflix [Member] | Revenues [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 26.00% | 44.00% | |
Netflix [Member] | Accounts Receivable [Member] | Credit Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 66.00% | 66.00% |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 1 Months Ended | 2 Months Ended | |
Aug. 31, 2014lawsuit | Oct. 31, 2014lawsuit | Mar. 31, 2016USD ($) | |
Loss Contingencies [Line Items] | |||
Remaining purchase obligation | $ 11.7 | ||
Shareholder Class Action Lawsuit [Member] | Pending Litigation [Member] | Unfavorable Regulatory Action [Member] | |||
Loss Contingencies [Line Items] | |||
Loss contingency, new claims filed | lawsuit | 2 | ||
Antitrust Class Action [Member] | Pending Litigation [Member] | Unfavorable Regulatory Action [Member] | |||
Loss Contingencies [Line Items] | |||
Loss contingency, new claims filed | lawsuit | 3 | ||
Prepaid Expenses [Member] | |||
Loss Contingencies [Line Items] | |||
Certain capital assets purchased to be resold | 6.3 | ||
Other Assets [Member] | |||
Loss Contingencies [Line Items] | |||
Certain capital assets purchased to be resold | $ 12 |
Computation of Basic and Dilute
Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Earnings Per Share, Basic and Diluted [Line Items] | ||
Net income (loss) attributable to DreamWorks Animation SKG, Inc. | $ 13,836 | $ (54,777) |
Weighted average common shares outstanding (in shares) | 86,443 | 85,734 |
Less: Unvested restricted stock (in shares) | (45) | (119) |
Denominator for basic calculation (in shares) | 86,398 | 85,615 |
Denominator for diluted calculation (in shares) | 87,679 | 85,615 |
Basic net income (loss) per share (in dollars per share) | $ 0.16 | $ (0.64) |
Diluted net income (loss) per share (in dollars per share) | $ 0.16 | $ (0.64) |
Restricted Stock Awards [Member] | ||
Earnings Per Share, Basic and Diluted [Line Items] | ||
Weighted average effects of dilutive stock-based compensation awards (in shares) | 1,281 | 0 |
Antidilutive Securities (Detail
Antidilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Restricted Stock Awards [Member] | Stock Compensation Plan [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 380 | 1,135 | [1] |
[1] | Due to the Company's loss for the three-month period ended March 31, 2015, all potential common stock equivalents are anti-dilutive. |
Contingently Issuable Equity Aw
Contingently Issuable Equity Awards (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Restricted Stock Awards [Member] | Contingently Issuable Shares [Member] | ||
Contingently Issuable Equity Awards Excluded from Computation of Earnings Per Share [Line Items] | ||
Contingently issuable equity awards | 677 | 1,372 |
Restructuring and Related Cha62
Restructuring and Related Charges Narrative (Details) - 2015 Restructuring Plan [Member] $ in Millions | Jan. 22, 2015employee | Mar. 31, 2016USD ($) |
Restructuring Cost and Reserve [Line Items] | ||
Expected costs | $ 241.3 | |
Cost incurred to date | $ 240 | |
Cumulative number of positions eliminated | employee | 500 |
Restructuring and Related Cha63
Restructuring and Related Charges Restructuring Costs (Details) - 2015 Restructuring Plan [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||
Employee termination costs | $ (670) | $ 4,587 |
Relocation and other employee-related costs | 256 | 1,496 |
Accelerated depreciation and amortization charges | 0 | 9,279 |
Total restructuring charges | $ (414) | $ 15,362 |
Restructuring and Related Cha64
Restructuring and Related Charges Restructuring Reserve (Details) - 2015 Restructuring Plan [Member] - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Restructuring Reserve [Roll Forward] | |||
Employee termination costs | $ (670) | $ 4,587 | |
Employee Termination Benefits [Member] | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring reserve, beginning of period | 11,969 | 36,808 | |
Employee termination costs | 0 | 10,286 | |
Changes in estimate | [1] | (670) | (5,036) |
Payments and other | (4,415) | (6,568) | |
Restructuring reserve, end of period | $ 6,884 | $ 35,490 | |
[1] | During the three months ended March 31, 2016, changes in estimate were primarily a result of the Company's ability to reduce severance payments to former employees who obtain subsequent employment during their respective severance periods. During the three months ended March 31, 2015, changes in estimate were primarily a result of a higher number of employees accepting relocation offers than the Company initially estimated. |
Subsequent Events (Details)
Subsequent Events (Details) - Forecast [Member] $ in Millions | 6 Months Ended |
Sep. 30, 2016USD ($) | |
Subsequent Event [Line Items] | |
Ownership percentage retained | 51.00% |
Expected Proceeds From Divestiture Of Businesses And Interests In Affiliates | $ 168 |
ATV Joint Venture [Member] | Verizon [Member] | |
Subsequent Event [Line Items] | |
Interest acquired | 24.50% |
Purchase price | $ 159 |
ATV Joint Venture [Member] | Hearst Corporation [Member] | |
Subsequent Event [Line Items] | |
Interest acquired | 24.50% |