Guarantor Financial Information | 19. Guarantor Financial Information The following supplemental financial information is being provided for purposes of compliance with reporting covenants contained in certain debt obligations of Nielsen and its subsidiaries. The financial information sets forth for Nielsen, its subsidiaries that have issued certain debt securities (the “Issuers”) and its guarantor and non-guarantor subsidiaries, the consolidating balance sheet as of December 31, 2018 and 2017 and consolidating statements of operations and cash flows for the periods ended December 31, 2018, 2017 and 2016. During the year ended December 31, 2017, the Company restructured certain legal entities and therefore the Company adjusted prior periods to reflect the current year structure. The issued debt securities are jointly and severally guaranteed on a full and unconditional basis by Nielsen and subject to certain exceptions, each of the direct and indirect 100% owned subsidiaries of Nielsen, in each case to the extent that such entities provide a guarantee under the senior secured credit facilities. The issuers are also 100% owned indirect subsidiaries of Nielsen: Nielsen Finance LLC and Nielsen Finance Co. for certain series of debt obligations, and The Nielsen Company (Luxembourg) S.ar.l., for the other series of debt obligations. Each issuer is a guarantor of the debt obligations not issued by it. Nielsen is a holding company and does not have any material assets or operations other than ownership of the capital stock of its direct and indirect subsidiaries. All of Nielsen’s operations are conducted through its subsidiaries, and, therefore, Nielsen is expected to continue to be dependent upon the cash flows of its subsidiaries to meet its obligations. The senior secured credit facilities contain certain limitations on the ability of Nielsen to receive the cash flows of its subsidiaries. While all subsidiary guarantees of the issued debt securities are full and unconditional, these guarantees contain customary release provisions including when (i) the subsidiary is sold or sells all of its assets, (ii) the subsidiary is declared “unrestricted” for covenant purposes, (iii) the subsidiary’s guarantee under the senior secured credit facilities is released and (iv) the requirements for discharge of the indenture have been satisfied. Nielsen Holdings plc For the year ended December 31, 2018 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Elimination Consolidated Revenues $ — $ — $ 3,566 $ 2,949 $ — $ 6,515 Cost of revenues, exclusive of depreciation and amortization shown separately below — — 1,457 1,348 — 2,805 Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below 4 — 946 1,008 — 1,958 Depreciation and amortization — — 542 133 — 675 Impairment of goodwill and other long-lived assets — — 579 834 — 1,413 Restructuring charges — — 51 88 — 139 Operating income/(loss) (4 ) — (9 ) (462 ) — (475 ) Interest income 1 681 38 6 (718 ) 8 Interest expense — (369 ) (704 ) (39 ) 718 (394 ) Foreign currency exchange transaction gains/(losses), net — — — (16 ) — (16 ) Other income/(expense), net — (6 ) 860 (859 ) — (5 ) Income/(loss) before income taxes and equity in net income/(loss) of subsidiaries (3 ) 306 185 (1,370 ) — (882 ) Benefit/(provision) for income taxes — (99 ) 139 142 — 182 Equity in net income/(loss) of subsidiaries (709 ) 167 (1,033 ) — 1,575 — Net income/(loss) (712 ) 374 (709 ) (1,228 ) 1,575 (700 ) Less net income/(loss) attributable to noncontrolling interests — — — 12 — 12 Net income/(loss) attributable to controlling interest (712 ) 374 (709 ) 1,240 1,575 (712 ) Total other comprehensive income/(loss) (170 ) 17 (170 ) (176 ) 328 (171 ) Total other comprehensive income/(loss) attributable to noncontrolling interests — — — (1 ) — (1 ) Total other comprehensive income/(loss) attributable to controlling interests (170 ) 17 (170 ) (175 ) 328 (170 ) Total comprehensive income/(loss) (882 ) 391 (879 ) (1,404 ) 1,903 (871 ) Comprehensive income/(loss) attributable to noncontrolling interests — — — 11 — 11 Total comprehensive income/(loss) attributable to controlling interest $ (882 ) $ 391 $ (879 ) $ (1,415 ) $ 1,903 $ (882 ) Nielsen Holdings plc For the year ended December 31, 2017 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Elimination Consolidated Revenues $ — $ — $ 3,608 $ 2,964 $ — $ 6,572 Cost of revenues, exclusive of depreciation and amortization shown separately below — — 1,419 1,346 — 2,765 Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below 4 — 933 936 — 1,873 Depreciation and amortization — — 504 136 — 640 Restructuring charges — — 44 36 — 80 Operating income/(loss) (4 ) — 708 510 — 1,214 Interest income 1 839 37 4 (877 ) 4 Interest expense — (353 ) (857 ) (41 ) 877 (374 ) Foreign currency exchange transaction gains/(losses), net — — (4 ) (6 ) — (10 ) Other income/(expense), net — (4 ) 162 (164 ) — (6 ) Income/(loss) before income taxes and equity in net income/(loss) of subsidiaries and affiliates (3 ) 482 46 303 — 828 Benefit/(provision) for income taxes (1 ) (146 ) (165 ) (76 ) — (388 ) Equity in net income/(loss) of subsidiaries 433 193 553 — (1,179 ) — Equity in net income/(loss) of affiliates — — (1 ) 1 — — Net income/(loss) 429 529 433 228 (1,179 ) 440 Less net income/(loss) attributable to noncontrolling interests — — — 11 — 11 Net income/(loss) attributable to controlling interest 429 529 433 217 (1,179 ) 429 Total other comprehensive income/(loss) 271 (21 ) 271 308 (556 ) 273 Total other comprehensive income/(loss) attributable to noncontrolling interests — — — 2 — 2 Total other comprehensive income/(loss) attributable to controlling interests 271 (21 ) 271 306 (556 ) 271 Total comprehensive income/(loss) 700 508 704 536 (1,735 ) 713 Comprehensive income/(loss) attributable to noncontrolling interests — — — 13 — 13 Total comprehensive income/(loss) attributable to controlling interest $ 700 $ 508 $ 704 $ 523 $ (1,735 ) $ 700 Nielsen Holdings plc Consolidated Statement of Comprehensive Income For the year ended December 31, 2016 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Elimination Consolidated Revenues $ — $ — $ 3,557 $ 2,752 $ — $ 6,309 Cost of revenues, exclusive of depreciation and amortization shown separately below — — 1,317 1,290 — 2,607 Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below 2 — 973 889 — 1,864 Depreciation and amortization — — 486 117 — 603 Restructuring charges — — 69 36 — 105 Operating income/(loss) (2 ) — 712 420 — 1,130 Interest income — 869 38 5 (908 ) 4 Interest expense (3 ) (310 ) (889 ) (39 ) 908 (333 ) Foreign currency exchange transaction gains/(losses), net — — 2 (8 ) — (6 ) Other income/(expense) net — (7 ) 171 (143 ) — 21 Income/(loss) before income taxes and equity in net income/(loss) of affiliates (5 ) 552 34 235 — 816 Benefit/(provision) for income taxes — (135 ) (115 ) (59 ) — (309 ) Equity in net income/(loss) of subsidiaries 507 185 589 — (1,281 ) — Equity in net income/(loss) of affiliates — — (1 ) 1 — — Net income/(loss) 502 602 507 177 (1,281 ) 507 Less net income/(loss) attributable to noncontrolling interests — — — 5 — 5 Net income/(loss) attributable to controlling interest 502 602 507 172 (1,281 ) 502 Total other comprehensive income/(loss) (152 ) 10 (152 ) (184 ) 321 (157 ) Total other comprehensive income/(loss) attributable to noncontrolling interests — — — (5 ) — (5 ) Total other comprehensive Income/(loss) attributable to controlling interests (152 ) 10 (152 ) (179 ) 321 (152 ) Total comprehensive income/(loss) $ 350 $ 612 $ 355 $ (7 ) $ (960 ) $ 350 Nielsen Holdings plc December 31, 2018 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Elimination Consolidated Assets: Current assets Cash and cash equivalents $ 3 $ — $ 79 $ 442 $ — $ 524 Trade and other receivables, net — 1 377 740 — 1,118 Prepaid expenses and other current assets — 3 234 124 — 361 Intercompany receivables 3 1,310 399 94 (1,806 ) — Total current assets 6 1,314 1,089 1,400 (1,806 ) 2,003 Non-current assets - Property, plant and equipment, net — — 303 165 — 468 Goodwill — — 5,531 1,456 — 6,987 Other intangible assets, net — — 4,545 479 — 5,024 Deferred tax assets 1 — — 332 — 333 Other non-current assets — 19 273 72 — 364 Equity investment in subsidiaries 2,815 1,232 1,936 — (5,983 ) — Intercompany loans 25 8,822 2,220 105 (11,172 ) — Total assets $ 2,847 $ 11,387 $ 15,897 $ 4,009 $ (18,961 ) $ 15,179 Liabilities and equity: Current liabilities Accounts payable and other current liabilities $ — $ 62 $ 541 $ 516 $ — $ 1,119 Deferred revenues — — 225 130 — 355 Income tax liabilities — — 20 56 — 76 Current portion of long-term debt, capital lease obligations and short-term borrowings — 54 46 7 — 107 Intercompany payables — — 1,408 398 (1,806 ) — Total current liabilities — 116 2,240 1,107 (1,806 ) 1,657 Non-current liabilities — Long-term debt and capital lease obligations — 8,170 95 15 — 8,280 Deferred tax liabilities — 71 956 81 — 1,108 Intercompany loans — — 8,952 2,220 (11,172 ) — Other non-current liabilities — 3 839 249 — 1,091 Total liabilities — 8,360 13,082 3,672 (12,978 ) 12,136 Total shareholders’ equity 2,847 3,027 2,815 141 (5,983 ) 2,847 Noncontrolling interests — — — 196 — 196 Total equity 2,847 3,027 2,815 337 (5,983 ) 3,043 Total liabilities and equity $ 2,847 $ 11,387 $ 15,897 $ 4,009 $ (18,961 ) $ 15,179 Nielsen Holdings plc Consolidated Balance Sheet December 31, 2017 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Elimination Consolidated Assets: Current assets Cash and cash equivalents $ 2 $ 1 $ 69 $ 584 $ — $ 656 Trade and other receivables, net — — 464 816 — 1,280 Prepaid expenses and other current assets — — 211 135 — 346 Intercompany receivables 4 1,187 325 155 (1,671 ) — Total current assets 6 1,188 1,069 1,690 (1,671 ) 2,282 Non-current assets - Property, plant and equipment, net — — 309 173 — 482 Goodwill — — 6,100 2,395 — 8,495 Other intangible assets, net — — 4,545 532 — 5,077 Deferred tax assets 1 — — 169 — 170 Other non-current assets — 17 263 80 — 360 Equity investment in subsidiaries 4,213 1,210 4,583 — (10,006 ) — Intercompany loans 25 8,608 424 140 (9,197 ) — Total assets $ 4,245 $ 11,023 $ 17,293 $ 5,179 $ (20,874 ) $ 16,866 Liabilities and equity: Current liabilities Accounts payable and other current liabilities $ — $ 61 $ 560 $ 520 $ — $ 1,141 Deferred revenues — — 231 130 — 361 Income tax liabilities — — 62 49 — 111 Current portion of long-term debt, capital lease obligations and short-term borrowings — 35 44 5 — 84 Intercompany payables — 2 1,345 324 (1,671 ) — Total current liabilities — 98 2,242 1,028 (1,671 ) 1,697 Non-current liabilities — Long-term debt and capital lease obligations — 8,237 101 19 — 8,357 Deferred tax liabilities — 71 1,296 68 — 1,435 Intercompany loans — 62 8,774 361 (9,197 ) — Other non-current liabilities — — 667 267 — 934 Total liabilities — 8,468 13,080 1,743 (10,868 ) 12,423 Total shareholders’ equity 4,245 2,555 4,213 3,238 (10,006 ) 4,245 Noncontrolling interests — — — 198 — 198 Total equity 4,245 2,555 4,213 3,436 (10,006 ) 4,443 Total liabilities and equity $ 4,245 $ 11,023 $ 17,293 $ 5,179 $ (20,874 ) $ 16,866 Nielsen Holdings plc For the year ended December 31, 2018 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Consolidated Net cash provided by/(used in) operating activities $ (2 ) $ 240 $ 383 $ 437 $ 1,058 Investing activities: — Acquisition of subsidiaries and affiliates, net of cash acquired — — (15 ) (28 ) (43 ) Proceeds from the sale of subsidiaries and affiliates 51 — 51 Additions to property, plant and equipment and other assets — — (53 ) (53 ) (106 ) Additions to intangible assets — — (356 ) (58 ) (414 ) Proceeds from the sale of property, plant and equipment and other assets — — — 4 4 Other investing activities — — 9 (7 ) 2 Net cash provided by/(used in) investing activities — — (364 ) (142 ) (506 ) Financing activities: Repayments of debt — (818 ) — (1 ) (819 ) Proceeds from the issuance of debt, net of issuance costs — 781 — — 781 Increase/(decrease) in short term borrowings — — — 1 1 Cash dividends paid to shareholders (494 ) — — — (494 ) Repurchase of common stock (70 ) — — — (70 ) Activity under stock plans 23 — (8 ) — 15 Proceeds from employee stock purchase plan 5 — — — 5 Capital leases — — (69 ) (7 ) (76 ) Settlement of intercompany and other financing activities 539 (204 ) 67 (421 ) (19 ) Net cash provided by/(used in) financing activities 3 (241 ) (10 ) (428 ) (676 ) Effect of exchange-rate changes on cash and cash equivalents — — 1 (9 ) (8 ) Net increase/(decrease) in cash and cash equivalents 1 — 10 (142 ) (132 ) Cash and cash equivalents at beginning of period 2 1 69 584 656 Cash and cash equivalents at end of period $ 3 $ — $ 79 $ 442 $ 524 Nielsen Holdings plc Consolidated Statement of Cash Flows For the year ended December 31, 2017 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Consolidated Net cash provided by/(used in) operating activities $ (1 ) $ 171 $ 789 $ 351 $ 1,310 Investing activities: — Acquisition of subsidiaries and affiliates, net of cash acquired — — (755 ) (23 ) (778 ) Proceeds from the sale of subsidiaries and affiliates 1 1 2 Additions to property, plant and equipment and other assets — — (63 ) (56 ) (119 ) Additions to intangible assets — — (307 ) (63 ) (370 ) Proceeds from the sale of property, plant and equipment and other assets — — 29 13 42 Other investing activities — — (11 ) (2 ) (13 ) Net cash provided by/(used in) investing activities — — (1,106 ) (130 ) (1,236 ) Financing activities: Repayments of debt — (2,295 ) — (1 ) (2,296 ) Proceeds from the issuance of debt, net of issuance costs — 2,744 1 — 2,745 Increase/(decrease) in short term borrowings — - — — (5 ) (5 ) Cash dividends paid to shareholders (474 ) — — — (474 ) Repurchase of common stock (140 ) — — — (140 ) Activity under stock plans 32 — (11 ) — 21 Proceeds from employee stock purchase plan 6 — — — 6 Capital leases — — (51 ) (4 ) (55 ) Settlement of intercompany and other financing activities 574 (620 ) 236 (207 ) (17 ) Net cash provided by/(used in) financing activities (2 ) (171 ) 175 (217 ) (215 ) Effect of exchange-rate changes on cash and cash equivalents — — (4 ) 47 43 Net increase/(decrease) in cash and cash equivalents (3 ) — (146 ) 51 (98 ) Cash and cash equivalents at beginning of period 5 1 215 533 754 Cash and cash equivalents at end of period $ 2 $ 1 $ 69 $ 584 $ 656 Nielsen Holdings plc Consolidated Statement of Cash Flows For the year ended December 31, 2016 Non- (IN MILLIONS) Parent Issuers Guarantor Guarantor Consolidated Net cash provided by/(used in) operating activities $ (5 ) $ 278 $ 671 $ 352 $ 1,296 Investing activities: Acquisition of subsidiaries and affiliates, net of cash acquired — — (242 ) (43 ) (285 ) Proceeds from the sale of subsidiaries and affiliates — — 36 (2 ) 34 Additions to property, plant and equipment and other assets — — (53 ) (56 ) (109 ) Additions to intangible assets — — (273 ) (51 ) (324 ) Proceeds from the sale of property, plant and equipment and other assets — — 31 11 42 Other investing activities — — (1 ) 1 — Net cash provided by/(used in) investing activities — — (502 ) (140 ) (642 ) Financing activities: Net payments under revolving credit facility — — (164 ) — (164 ) Repayments of debt — (1,765 ) — — (1,765 ) Proceeds from the issuance of debt, net of issuance costs — 2,502 — — 2,502 Increase in short term borrowings — — — 4 4 Cash dividends paid to shareholders (434 ) — — — (434 ) Repurchase of common stock (418 ) — — — (418 ) Activity under stock plans 103 — (22 ) — 81 Other financing activities 758 (1,014 ) 222 (20 ) (54 ) Net cash provided by/(used in) financing activities 9 (277 ) 36 (16 ) (248 ) Effect of exchange-rate changes on cash and cash equivalents — — 3 (12 ) (9 ) Net increase/(decrease) in cash and cash equivalents 4 1 208 184 397 Cash and cash equivalents at beginning of period 1 — 7 349 357 Cash and cash equivalents at end of period $ 5 $ 1 $ 215 $ 533 $ 754 |