Exhibit 99.2
Liberty Media Corporation
Condensed Pro Forma Consolidated Financial Statements
December 31, 2012
(unaudited)
On May 3, 2013, Liberty Media Corporation (the “Company”), through a wholly-owned subsidiary, acquired (i) 26,858,577 shares of Class A common stock (“Charter Common Stock”), par value $0.001 per share, of Charter Communications, Inc. (“Charter”) for $95.50 per share and (ii) warrants to purchase 947,094 shares of Charter Common Stock with an exercise price of $46.86 and warrants to purchase 136,202 shares of Charter Common Stock with an exercise price of $51.28 (the “Warrants”) for $95.50 per Warrant less the applicable exercise price.
The following unaudited condensed pro forma consolidated financial statements have been prepared giving effect to the acquisition of Charter as if it occurred as of December 31, 2012 and March 31, 2013 for the condensed pro forma consolidated balance sheets and January 1, 2012 for the condensed pro forma consolidated statements of operation. The unaudited condensed pro forma consolidated financial statements do not purport to represent what Liberty's financial position actually would have been had the acquisition of Charter occurred on the dates indicated or to project Liberty's operating results for any future period. The pro forma adjustments are based upon available information and certain assumptions that Liberty's management believes are reasonable. The unaudited condensed pro forma consolidated financial statements should be read in conjunction with the publicly available information of Liberty, including the Form 10-K, as filed on February 27, 2012 with the Securities and Exchange Commission (the “SEC”).
Liberty Media Corporation
Condensed Pro Forma Consolidated Balance Sheet
December 31, 2012
(unaudited)
|
| | | | | | | | | | | |
| | | Liberty | | | | Liberty | |
| | | Media | | Pro Forma | | Media | |
| | | historical (1) | | adjustments (2) | | pro forma | |
| Assets | | | | | | | |
| Cash and cash equivalents | | $ | 1,353 |
| | (1,254 | ) | | 99 |
| |
| Other current assets | | 858 |
| | — |
| | 858 |
| |
| Investments in available-for-sale securities | | 1,392 |
| | — |
| | 1,392 |
| |
| Investments in affiliates, accounted for using the equity method | | 3,341 |
| | 2,624 |
| | 5,965 |
| |
| Property and equipment, net | | 207 |
| | — |
| | 207 |
| |
| Intangible assets not subject to amortization | | 475 |
| | — |
| | 475 |
| |
| Intangible assets subject to amortization, net | | 120 |
| | — |
| | 120 |
| |
| Other assets, at cost, net of accumulated amortization | | 579 |
| | — |
| | 579 |
| |
| Total assets | | $ | 8,325 |
| | 1,370 |
| | 9,695 |
| |
| | | | | | | | |
| Liabilities and Equity | | |
| | | | | |
| Current liabilities | | $ | 385 |
| | — |
| | 385 |
| |
| Long-term debt | | 536 |
| | 1,370 |
| | 1,906 |
| |
| Deferred income tax liabilities | | 802 |
| | — |
| | 802 |
| |
| Other liabilities | | 170 |
| | — |
| | 170 |
| |
| Total liabilities | | 1,893 |
| | 1,370 |
| | 3,263 |
| |
| | | | | | | | |
| Total stockholders' equity | | 6,440 |
| | — |
| | 6,440 |
| |
| Noncontrolling interests in equity of subsidiaries | | (8 | ) | | — |
| | (8 | ) | |
| Total equity | | 6,432 |
| | — |
| | 6,432 |
| |
| | | | | | | | |
| Total liabilities and equity | | $ | 8,325 |
| | 1,370 |
| | 9,695 |
| |
| | | | | | | |
Liberty Media Corporation
Condensed Pro Forma Consolidated Balance Sheet
March 31, 2013
(unaudited)
|
| | | | | | | | | | | |
| | | Liberty | | | | Liberty | |
| | | Media | | Pro Forma | | Media | |
| | | historical (1) | | adjustments (2) | | pro forma | |
| Assets | | | | | | | |
| Cash and cash equivalents | | $ | 1,900 |
| | (1,254 | ) | | 646 |
| |
| Other current assets | | 1,558 |
| | — |
| | 1,558 |
| |
| Investments in available-for-sale securities | | 1,266 |
| | — |
| | 1,266 |
| |
| Investments in affiliates, accounted for using the equity method | | 870 |
| | 2,624 |
| | 3,494 |
| |
| Property and equipment, net | | 1,783 |
| | — |
| | 1,783 |
| |
| Intangible assets not subject to amortization | | 23,889 |
| | — |
| | 23,889 |
| |
| Intangible assets subject to amortization, net | | 1,039 |
| | — |
| | 1,039 |
| |
| Other assets, at cost, net of accumulated amortization | | 91 |
| | — |
| | 91 |
| |
| Total assets | | $ | 32,396 |
| | 1,370 |
| | 33,766 |
| |
| | | | | | | | |
| Liabilities and Equity | | |
| | | | | |
| Current liabilities | | $ | 2,452 |
| | — |
| | 2,452 |
| |
| Long-term debt | | 2,415 |
| | 1,370 |
| | 3,785 |
| |
| Deferred income tax liabilities | | 2,346 |
| | — |
| | 2,346 |
| |
| Other liabilities | | 432 |
| | — |
| | 432 |
| |
| Total liabilities | | 7,645 |
| | 1,370 |
| | 9,015 |
| |
| | | | | | | | |
| Total stockholders' equity | | 14,277 |
| | — |
| | 14,277 |
| |
| Noncontrolling interests in equity of subsidiaries | | 10,474 |
| | — |
| | 10,474 |
| |
| Total equity | | 24,751 |
| | — |
| | 24,751 |
| |
| | | | | | | | |
| Total liabilities and equity | | $ | 32,396 |
| | 1,370 |
| | 33,766 |
| |
| | | | | | | |
Liberty Media Corporation
Condensed Pro Forma Consolidated Statement of Operations
Year ended December 31, 2012
(unaudited)
|
| | | | | | | | | | | | |
| | | Liberty | | | | Liberty | |
| | | Media | | Pro Forma | | Media | |
| | | historical (1) | | adjustments (3) | | pro forma | |
| | | | | | | | |
| Revenue | | $ | 1,999 |
| | — |
| | 1,999 |
| |
| Operating costs and expenses: | | |
| | | | | |
| Operating and Selling, general and administrative, including stock-based compensation | | 1,615 |
| | — |
| | 1,615 |
| |
| Depreciation and amortization | | 58 |
| | — |
| | 58 |
| |
| | | 1,673 |
| | — |
| | 1,673 |
| |
| Operating income | | 326 |
| | — |
| | 326 |
| |
| Interest expense | | (33 | ) | | (39 | ) | | (72 | ) | |
| Share of earnings (loss) | | 1,346 |
| | (161 | ) | | 1,185 |
| |
| Realized and unrealized gains (losses) on financial instruments, net | | 232 |
| | — |
| | 232 |
| |
| Other income (expense) | | 141 |
| | — |
| | 141 |
| |
| Earnings (loss) from continuing operations before income taxes | | 2,012 |
| | (200 | ) | | 1,812 |
| |
| Income tax (expense) benefit | | (600 | ) | | 76 |
| | (524 | ) | |
| Net earnings (loss) | | 1,412 |
| | (124 | ) | | 1,288 |
| |
| Less net loss attributable to the noncontrolling interests | | (2 | ) | | — |
| | (2 | ) | |
| Net earnings (loss) attributable to Liberty stockholders | | $ | 1,414 |
| | (124 | ) | | 1,290 |
| |
| | | | | | | | |
| ProForma basic net earnings (loss) attributable to Liberty Spinco stockholders per common share: | |
| Series A and Series B Liberty Media common stock | | $ | 11.78 |
| | | | $ | 10.75 |
| |
| | | | | | | | |
| ProForma diluted net earnings (loss) attributable to Liberty Spinco stockholders per common share: | |
| Series A and Series B Liberty Media common stock | | $ | 11.40 |
| | | | $ | 10.40 |
| |
| | | | | | | | |
| Basic | | 120 |
| | | | 120 |
| |
| Diluted | | 124 |
| | | | 124 |
| |
Liberty Media Corporation
Condensed Pro Forma Consolidated Statement of Operations
Three months ended March 31, 2013
(unaudited)
|
| | | | | | | | | | | | |
| | | Liberty | | | | Liberty | |
| | | Media | | Pro Forma | | Media | |
| | | historical (1) | | adjustments (3) | | pro forma | |
| | | | | | | | |
| Revenue | | $ | 789 |
| | — |
| | 789 |
| |
| Operating costs and expenses: | | |
| | | | | |
| Operating and Selling, general and administrative, including stock-based compensation | | 559 |
| | — |
| | 559 |
| |
| Depreciation and amortization | | 70 |
| | — |
| | 70 |
| |
| | | 629 |
| | — |
| | 629 |
| |
| Operating income | | 160 |
| | — |
| | 160 |
| |
| Interest expense | | (11 | ) | | (10 | ) | | (21 | ) | |
| Share of earnings (loss) | | 17 |
| | (31 | ) | | (14 | ) | |
| Realized and unrealized gains (losses) on financial instruments, net | | 97 |
| | — |
| | 97 |
| |
| Gain (loss) on transactions, net | | 7,479 |
| | — |
| | 7,479 |
| |
| Other income (expense) | | 7 |
| | — |
| | 7 |
| |
| Earnings (loss) from continuing operations before income taxes | | 7,749 |
| | (41 | ) | | 7,708 |
| |
| Income tax (expense) benefit | | 361 |
| | 15 |
| | 376 |
| |
| Net earnings (loss) | | 8,110 |
| | (26 | ) | | 8,084 |
| |
| Less net loss attributable to the noncontrolling interests | | 48 |
| | — |
| | 48 |
| |
| Net earnings (loss) attributable to Liberty stockholders | | $ | 8,062 |
| | (26 | ) | | 8,036 |
| |
| | | | | | | | |
| ProForma basic net earnings (loss) attributable to Liberty Spinco stockholders per common share: | |
| Series A and Series B Liberty Media common stock | | $ | 67.75 |
| | | | $ | 67.53 |
| |
| | | | | | | | |
| ProForma diluted net earnings (loss) attributable to Liberty Spinco stockholders per common share: | |
| Series A and Series B Liberty Media common stock | | $ | 66.63 |
| | | | $ | 66.42 |
| |
| | | | | | | | |
| Basic | | 119 |
| | | | 119 |
| |
| Diluted | | 121 |
| | | | 121 |
| |
Liberty Media Corporation
Notes to Condensed Pro Forma Consolidated Financial Statements
(unaudited)
| |
| (1) | Represents the historical financial position and results of operations of Liberty. Such amounts were derived from the historical consolidated financial statements of Liberty Media Corporation as filed on Form 10-K on February 27, 2013 and Form 10-Q on May 9, 2013, respectively, with the SEC. |
| |
| (2) | The pro forma adjustments to the balance sheet are the result of the acquisition of Liberty's equity interest in Charter using a combination of cash on hand and additional financing arrangements. |
| |
| (3) | The pro forma adjustments to the statement of operations are related to: (1) the interest that would have been incurred on the new long-term debt utilized to fund the direct purchase of the Charter Common Stock at the current rates on the debt; (2) the pro forma adjustment for Liberty's proportionate share of earnings (losses) based on the equity percentage acquired as of May 3, 2017 applied to the historical net loss for Charter in the periods provided; (3) the amortization of certain assets acquired after the application of purchase accounting on the excess of the purchase price over the book value of Charter acquired; and (4) a provision of income taxes on the pro forma adjustments. |
