Publishing Segment
For the fourth quarter ended December 31, 2005, revenues for the Publishing Segment were $37.3 million, a decrease of $40.7 million, from revenues of $78.0 million in the comparable prior year quarter. The decrease was primarily due to reduced circulation revenue of $17.4 million, and lower advertising revenue of $20.9 million. The fourth quarter advertising decline was largely the result of TV Guide’s format change.
For the fourth quarter of 2005, adjusted EBITDA for the Publishing Segment was $(43.0) million, a decrease of $34.6 million from adjusted EBITDA of $(8.4) in the prior year’s quarter. The decrease was primarily due to the $40.7 million revenue decline, $8.4 million in operating and shut-down expenses forInside TV, partially offset by reduced magazine production and operating expenses of $14.8 million, primarily from lower printing, paper, and distribution expenses.
For the full year ended December 31, 2005, the Publishing Segment generated revenue of $237.9 million, representing 39.4% of the Company’s total revenue. Revenues for the full year 2005 decreased $90.0 million, or 27.4%, from revenues of $327.9 million in 2004. This decrease in revenue was primarily due to a decrease of $40.8 million in advertising revenue and of $47.3 million in circulation revenue at TV Guide magazine, which includes $4.7 million in new magazine related initial placement fees.
For the full year 2005, adjusted EBITDA for the Publishing Segment was $(93.4) million, a decrease of $98.4 million from adjusted EBITDA of $5.0 million in 2004. The decrease was largely due to $60.0 million in operating loss for TV Guide magazine and $32.4 million in operating and shut-down expenses for InsideTV.
Cable and Satellite Segment
For the fourth quarter ended December 31, 2005, revenues for the Cable and Satellite Segment were $69.8 million, an increase of $5.6 million, or 8.7 %, from revenues of $64.3 million in the prior year’s quarter. This was primarily due to increased subscribers and licensing revenues at TV Guide Interactive of $5.3 million.
For the fourth quarter of 2005, adjusted EBITDA for the Cable and Satellite Segment was $26.7 million, an increase of $6.4 million from adjusted EBITDA of $20.3 million in the prior year’s quarter. The increase was primarily related to the increased revenues at TV Guide Interactive.
For the full year ended December 31, 2005, the Cable and Satellite Segment generated revenue of $271.8 million, which represented 45.0 % of the Company’s total revenue. Revenue for the full year 2005 increased $40.9 million, or 17.7 %, from revenue of $230.9 million in 2004. The increase was primarily due to $24.3 million, or 36.1%, increase in TV Guide Interactive licensing revenue; a $9.9 million, or 10.6%, increase in TV Guide Channel advertising revenue, primarily attributable to increased CPMs for both infomercial and national advertising revenue; an increase of $12.6 million, or 32.2%, in TVG Network revenue, due to increased wagering, offset by decreases of $3.1 million in TV Guide Channel carriage revenue and $2.9 million in IPG advertising revenue.
For the full year 2005, adjusted EBITDA for the Cable and Satellite Segment increased to $108.4 million, up 10.7%, or $10.5 million from adjusted EBITDA of $97.9 million in 2004. The increase was largely due increased revenues, offset by increases of $14.1 million in programming, marketing and compensation expenses at the TV Guide Channel and $5.7 million in expenses for TV Guide Spot, for which there was no comparable cost in the prior year. The Company also incurred approximately $5.0 million in additional operating expenses related to the planned increase in the size of GuideWorks, LLC, a joint venture with Comcast focused on the development of next generation IPG technology for the cable industry.
Consumer Electronics Licensing Segment
For the fourth quarter ended December 31, 2005, revenue for the Consumer Electronics (CE) Licensing Segment was $22.2 million, a decrease of $0.4 million from revenue of $22.6 million in the prior year’s quarter. Revenues for the Company’s VCR Plus+ business decreased by $2.0 million and the CE IPG business, including, for the first time, Scientific-Atlanta, Inc. related licensing revenue, increased by $2.4 million.
For the fourth quarter of 2005, adjusted EBITDA for the CE Licensing Segment was $8.0 million, an increase of $3.7 million, or 88.9 %, from adjusted EBITDA of $4.2 million in the prior year’s quarter. The increase was primarily related to lower outside legal costs of $5.2 million.
For the full year ended December 31, 2005, the CE Licensing Segment generated revenue of $94.5 million, which represented 15.6 % of the Company’s total revenue. Revenue for the full year decreased $23.1 million, or 19.6 %, from revenue of $117.5 million in 2004 which included $19.4 million in settlements for which there were no comparable amounts in 2005. Decreased VCR Plus revenues of $9.2 million, due to reduced unit volumes and the impact of technology bundling agreements, as well as the absence of a contract with a major CE manufacturer also contributed to the year-on-year decline.
For the full year 2005, adjusted EBITDA for the CE Licensing Segment was $40.2 million, compared with adjusted EBITDA of $42.6 million in 2004. The segment’s 2005 adjusted EBITDA was impacted by the reduction in revenues noted above and $2.5 million in severance expenses, offset by a $26.5 million decrease in legal expenses, primarily due to the settlement of legal matters with Scientific-Atlanta, Inc.
Corporate Segment
For the fourth quarter ended December 31, 2005, adjusted EBITDA for the Corporate Segment was $(18.9) million, compared to adjusted EBITDA of $(16.2) million in the prior year’s quarter. The increase was primarily due to increased general and administrative expenses, including severance, recruiting, and compensation expenses.
For the full year ended December 31, 2005, adjusted EBITDA for the Corporate Segment was $(61.5) million, an improvement of $17.4 million from adjusted EBITDA of $(78.9) million in 2004. The decline in corporate expenses was primarily due to a $16.7 million decline in corporate legal expenses primarily for litigation involving former officers.
Consolidated outside legal expenses for the three month and full year periods ended December 31, 2005 were $7.5 million and $24.5 million, respectively, compared with $13.6 million and $68.0 million for the same periods in 2004. However, due to ongoing litigation, there can be no assurances that this reduced level of outside legal spending will be maintained in 2006. The Company itself is a party to several significant pending legal proceedings and in addition various proceedings for which we are required to advance the legal fees and expenses incurred by our former officers remain unresolved. Accordingly, we expect outside legal expenses to continue to be significant for the foreseeable future.
Discussion of Cash and Liquidity
At December 31, 2005, the Company’s cash, cash equivalents and current marketable securities were $474.4 million, excluding restricted cash of $39.5 million. Cash and cash equivalents decreased $93.4 million for the year ended December 31, 2005. Outstanding short- and long-term debt, made up entirely of capital lease obligations, were $13.3 million, resulting in cash and cash equivalents and current marketable securities in excess of debt obligations of $461.1 million, excluding $39.5 million in restricted cash.
For the year ended December 31, 2005, the Company paid $93.6 million in income taxes. Additionally, the Company received $43.3 million in cash proceeds during the fourth quarter from the SkyMall sale. In the fourth quarter the Company invested $9.4 million in capital expenditures, bringing the total for capital expenditures in 2005 to $22.1 million. Net cash used in operating activities in 2005 totaled $121.7 million. For the full year 2005 we recognized non-cash revenue of approximately $75.4 million into the income statement, including from contracts entered into in prior years where we received large up front cash payments.
Consistent with previous estimates, the Company continues to expect that TV Guide magazine operations will incur aggregate operating losses of approximately $100 million to $110 million over the 2005 and 2006 fiscal years. Included in these losses are the anticipated costs of new rack acquisitions, consumer marketing and promotion programs. For 2005, we incurred approximately $60 million in losses from TV Guide magazine. The actual amount and timing of these losses will depend upon a number of factors, including the rate of rack acquisition and the level of consumer and advertiser acceptance. We believe the reformatted TV Guide magazine will begin to contribute positively to the Publishing Segment’s adjusted EBITDA in the latter half of 2008.
We intend to pursue various strategic initiatives to better position ourselves as the leading consumer brand for video guidance across multiple platforms. We anticipate that these initiatives will result in additional operating expenses and capital expenditures. In 2006 we plan on capital expenditures of approximately $40.0 to $45.0 million as compared with $22.1 million in 2005. This increase primarily relates to enhancing our data infrastructure and building our digital content infrastructure, increasing production infrastructure for TV Guide Channel and upgrading our systems and information technology infrastructure, including implementing Oracle as our centralized financial system. In addition, we anticipate operating expenses associated with these initiatives, and for additional research and development activities, of approximately $15 to $20 million in 2006. As with our business development and product development and technology groups’ costs, to the extent that these costs support company-wide initiatives or to the extent that they are preliminary spend against an initiative that has not been assigned to a business segment, these costs will likely be included in operating expenses in our Corporate Segment.
As a result of the completion of an IRS examination of the Company’s federal income tax returns for the years 2000 and 2001, the Company is entitled to a tax refund of $13.6 million plus interest. Additionally, the Company filed additional income tax refund requests in the fourth quarter of 2005 for approximately $35.8 million. The full amount of these tax refunds are reflected in the Company’s condensed consolidated balance sheet at December 31, 2005. Subsequent to the close of the 2005, the Company received a total of $42.4 million from the IRS in the first quarter of 2006 and expects to receive additional tax refunds of approximately $7.0 million during the first half of 2006.
The IRS is currently examining our U.S. federal tax returns for years 2002 and 2003. The results of this and future IRS examinations may result in the recognition of significant amounts of income or significant cash outlays in future periods. We believe that adequate reserves have been made for any adjustment that might be assessed for open years. Due to, among other things, potential income tax obligations in 2006, additional reductions in our deferred revenue balance, capital expenditures and the spending associated with Company’s digital initiatives, the Company’s cash balance is expected to decline in 2006.
Conference Call
Gemstar-TV Guide will host a conference call with the financial community today, Wednesday, March 8, 2006 at 2:00 p.m. PDT (5:00 p.m. EDT). Rich Battista, chief executive officer, will present management’s review of the fourth quarter and full year 2005, followed by a question and answer period.
The conference call will be available on conference call lines and will be web cast. Investors and analysts may connect to the call by dialing (866) 314-4483(domestic) or (617) 213-8049(international). The pass code is “38337500". To listen via web cast, link to the Company’s Websitehttp://ir.gemstartvguide.com.
Investors unable to listen to the call live may access an audio replay, which will be hosted for one week following the conclusion of the call. To access the replay, call (888) 286-8010 (domestic) or (617) 801-6888 (international). The pass code is “13003696". An audio archive will also be hosted on the Company’s investor relations Web site athttp://ir.gemstartvguide.com. Replays will be available approximately two hours following the conclusion of the call.
About Gemstar-TV Guide International, Inc.
Gemstar-TV Guide International, Inc. (the “Company”) (NASDAQ: GMST) is a leading media, entertainment and technology company that develops, licenses, markets and distributes technologies, products and services targeted at the television guidance and home entertainment needs of consumers worldwide. The Company’s businesses include: television media and publishing properties; interactive program guide services and products; and technology and intellectual property licensing. Additional information about the Company can be found at www.gemstartvguide.com.
Forward-Looking Statements:
This news release contains forward-looking statements that involve risks and uncertainties, including risks and uncertainties related to the transformation of our TV Guide magazine publishing business; timely availability and market acceptance of products and services incorporating the Company’s technologies and content; our investment in new and existing businesses, including TV Guide magazine and TV Guide Spot; the impact of competitive products and pricing; ongoing and potential future litigation; and the other risks detailed from time to time in the Company’s SEC reports, including the most recent reports on Forms 10-K, 10-Q and 8-K, each as it may be amended from time to time. The Company assumes no obligation to update these forward-looking statements.
Note to Editors: Gemstar®, TV Guide®, TV Guide Channel®, and TV Guide Interactive® are trademarks or registered trademarks of Gemstar-TV Guide International, Inc. and/or its subsidiaries. The names of other companies and products used herein are for identification purposes only and may be trademarks of their respective owners.
Financial Tables Follow
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Contacts:
Gemstar-TV Guide International, Inc.
(Analysts and Shareholders) | |
(Media) | |
| Robert L. Carl | | Eileen Murphy | |
| VP, Investor Relations | | SVP, Corporate Communications | |
| 323-817-4600 | | 212-852-7336 | |
GEMSTAR-TV GUIDE INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
| December 31, |
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| | 2005 | 2004 |
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| ASSETS | | |
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| Current assets: | | | | | | | | |
| Cash and cash equivalents | | | $ | 465,131 | | $ | 558,529 | |
| Restricted cash | | | | 39,484 | | | 38,880 | |
| Marketable securities | | | | 9,253 | | | 11,191 | |
| Receivables, net | | | | 77,230 | | | 116,958 | |
| Deferred tax assets, net | | | | 21,305 | | | 3,863 | |
| Current income taxes receivable | | | | 50,204 | | | 21,333 | |
| Other current assets | | | | 29,348 | | | 30,950 | |
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| Total current assets | | | | 691,955 | | | 781,704 | |
| Property and equipment, net | | | | 51,127 | | | 45,483 | |
| Indefinite-lived intangible assets | | | | 61,800 | | | 66,272 | |
| Finite-lived intangible assets, net | | | | 107,638 | | | 123,349 | |
| Goodwill | | | | 259,524 | | | 259,524 | |
| Income taxes receivable | | | | 55,629 | | | 40,998 | |
| Deferred tax assets, long-term | | | | 10,143 | | | -- | |
| Other assets | | | | 21,866 | | | 38,020 | |
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| | | | $ | 1,259,682 | | $ | 1,355,350 | |
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| LIABILITIES AND STOCKHOLDERS' EQUITY | | |
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| Current liabilities: | | | | | | | | |
| Accounts payable | | | $ | 29,111 | | $ | 62,284 | |
| Accrued liabilities | | | | 166,285 | | | 171,621 | |
| Income taxes payable | | | | 3,259 | | | 232 | |
| Current portion of capital lease obligations | | | | 558 | | | 515 | |
| Current portion of deferred revenue | | | | 139,913 | | | 154,664 | |
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| Total current liabilities | | | | 339,126 | | | 389,316 | |
| Deferred tax liabilities, net | | | | -- | | | 28,274 | |
| Long-term capital lease obligations, less current portion | | | | 12,715 | | | 13,274 | |
| Deferred revenue, less current portion | | | | 425,286 | | | 485,941 | |
| Other liabilities | | | | 109,349 | | | 127,753 | |
| Commitments and contingencies | | | | | | | | |
| Stockholders' equity: | | | | | | | | |
| Preferred stock, par value $.01 per share; authorized 150,000 shares, none issued | | | | -- | | | -- | |
| Common stock, par value $.01 per share; authorized 2,350,000 shares; 433,759 | | | | | | | | |
| shares issued and 426,162 shares outstanding at December 31, 2005; 433,754 | | | | | | | | |
| shares issued and 424,063 shares outstanding at December 31, 2004 | | | | 4,337 | | | 4,337 | |
| Additional paid-in capital | | | | 8,465,785 | | | 8,478,540 | |
| Accumulated deficit | | | | (8,022,885 | ) | | (8,077,700 | ) |
| Accumulated other comprehensive income, net of tax | | | | 477 | | | 659 | |
| Treasury stock, at cost; 7,597 shares at December 31, 2005 and 9,691 shares at | | | | | | | | |
| December 31, 2004 | | | | (74,508 | ) | | (95,044 | ) |
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| Total stockholders' equity | | | | 373,206 | | | 310,792 | |
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| | | | $ | 1,259,682 | | $ | 1,355,350 | |
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For additional information please see Notes to Consolidated Financial Statements in Form-10K.
GEMSTAR-TV GUIDE INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| Three Months Ended
December 31,
| Year Ended
December 31,
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| 2005
| 2004
| 2005
| 2004
| 2003
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| Revenues: | | | | | | | | | | | | | | | | | |
| Publishing | | | $ | 37,303 | | $ | 77,983 | | $ | 237,900 | | $ | 327,880 | | $ | 374,150 | |
| Cable and satellite | | | | 69,839 | | | 64,267 | | | 271,813 | | | 230,948 | | | 161,776 | |
| Consumer electronics licensing | | | | 22,226 | | | 22,591 | | | 94,479 | | | 117,541 | | | 109,767 | |
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| | | | | 129,368 | | | 164,841 | | | 604,192 | | | 676,369 | | | 645,693 | |
| Operating Expenses: | | |
| Publishing | | | | 80,331 | | | 86,382 | | | 331,343 | | | 333,004 | | | 370,853 | |
| Lease settlement | | | | -- | | | -- | | | -- | | | (10,088 | ) | | -- | |
| Cable and satellite | | | | 43,182 | | | 44,017 | | | 163,448 | | | 133,040 | | | 121,657 | |
| Consumer electronics licensing | | | | 14,259 | | | 18,373 | | | 54,296 | | | 74,941 | | | 69,911 | |
| Corporate | | | | 18,933 | | | 16,188 | | | 61,455 | | | 78,870 | | | 169,257 | |
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| Operating expenses, exclusive of expenses shown below | | | | 156,705 | | | 164,960 | | | 610,542 | | | 609,767 | | | 731,678 | |
| Stock compensation | | | | 38 | | | 111 | | | 132 | | | 437 | | | 33,551 | |
| Depreciation and amortization | | | | 8,155 | | | 7,479 | | | 29,184 | | | 39,037 | | | 131,967 | |
| Impairment of intangible assets | | | | -- | | | -- | | | -- | | | 131,637 | | | 391,003 | |
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| | | | | 164,898 | | | 172,550 | | | 639,858 | | | 780,878 | | | 1,288,199 | |
| Operating loss | | | | (35,530 | ) | | (7,709 | ) | | (35,666 | ) | | (104,509 | ) | | (642,506 | ) |
| Interest income (expense), net | | | | 4,564 | | | 2,755 | | | 15,544 | | | 5,498 | | | (4,288 | ) |
| Other income, net | | | | 661 | | | 1,375 | | | 337 | | | 14,413 | | | 3,760 | |
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| Loss from continuing operations before income taxes | | | | (30,305 | ) | | (3,579 | ) | | (19,785 | ) | | (84,598 | ) | | (643,034 | ) |
| Income tax (benefit) expense | | | | (13,512 | ) | | 187 | | | (40,395 | ) | | (8,566 | ) | | (64,102 | ) |
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| (Loss) income from continuing operations | | | | (16,793 | ) | | (3,766 | ) | | 20,610 | | | (76,032 | ) | | (578,932 | ) |
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| Discontinued operations: | | | | | | | | | | | | | | | | | |
| Income from discontinued operations | | | | 3,347 | | | 4,999 | | | 8,394 | | | 23,336 | | | 9,054 | |
| Gain (loss) on disposal of discontinued operations | | | | 43,169 | | | -- | | | 43,169 | | | (28,882 | ) | | -- | |
| Income tax expense (benefit) | | | | 17,049 | | | (407 | ) | | 17,358 | | | 12,883 | | | 7,520 | |
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| Income (loss) from discontinued operations | | | | 29,467 | | | 5,406 | | | 34,205 | | | (18,429 | ) | | 1,534 | |
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| Net income (loss) | | | $ | 12,674 | | $ | 1,640 | | $ | 54,815 | | $ | (94,461 | ) | $ | (577,398 | ) |
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| Basic and diluted income (loss) per share: | | | | | | | | | | | | | | | | | |
| (Loss) income from continuing operations | | | $ | (0.04 | ) | $ | (0.01 | ) | $ | 0.05 | | $ | (0.18 | ) | $ | (1.41 | ) |
| Income (loss) from discontinued operations | | | | 0.07 | | | 0.01 | | | 0.08 | | | (0.04 | ) | | -- | |
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| Net income (loss) | | | $ | 0.03 | | $ | 0.00 | | $ | 0.13 | | | (0.22 | ) | $ | (1.41 | ) |
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| Weighted average shares outstanding - basic | | | | 426,162 | | | 423,951 | | | 425,366 | | | 422,723 | | | 410,265 | |
| Weighted average shares outstanding - diluted | | | | 426,264 | | | 427,525 | | | 426,240 | | | 422,723 | | | 410,265 | |
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(1) In 2004 and 2005, the Company sold its Superstar/Netlink Group LLC (“SNG”), UVTV distribution services and SpaceCom Systems businesses (collectively the “SNG Businesses”) and SkyMall businesses, respectively along with substantially all of the operating assets of these businesses. Accordingly, these businesses, previously reported as part of the Cable and Satellite and Publsihing business segments, are shown as discontinued operations in the accompanying consolidated statements of operations.
(2) Certain financial statement items for prior periods, including the results of discontinued operations, have been reclassified to conform to the 2005 presentation.
For additional information please see Notes to Consolidated Financial Statements in Form-10K.
GEMSTAR-TV GUIDE INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
| Year ended December 31,
|
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| 2005
| | 2004
| | 2003
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| Cash flows from operating activities: | | | | | | | | | | | |
| Net income (loss) | | | $ | 54,815 | | $ | (94,461 | ) | $ | (577,398 | ) |
| Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | | |
| Depreciation and amortization | | | | 30,140 | | | 40,548 | | | 172,940 | |
| Deferred income taxes | | | | (55,859 | ) | | (2,242 | ) | | (58,038 | ) |
| (Gain) loss on disposal of discontinued operations | | | | (43,169 | ) | | 28,882 | | | -- | |
| Stock compensation expense | | | | 132 | | | 437 | | | 33,551 | |
| Impairment of intangible assets | | | | -- | | | 131,637 | | | 416,481 | |
| Gain on sale of equity investments | | | | -- | | | (14,482 | ) | | -- | |
| Gain on lease settlement | | | | -- | | | (10,088 | ) | | -- | |
| Other | | | | 4,846 | | | 421 | | | (1,788 | ) |
| Changes in operating assets and liabilities: | | | | | | | | | | | |
| Receivables | | | | 28,107 | | | (16,097 | ) | | 43,639 | |
| Income taxes | | | | (40,475 | ) | | 20,997 | | | 6,479 | |
| Other assets | | | | 6,939 | | | 3,842 | | | 15,248 | |
| Accounts payable, accrued liabilities and other liabilities | | | | (31,771 | ) | | (61,944 | ) | | 17,762 | |
| Deferred revenue | | | | (75,406 | ) | | 359,667 | | | (63,779 | ) |
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| Net cash (used in) provided by operating activities | | | | (121,701 | ) | | 387,117 | | | 5,097 | |
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| Cash flows from investing activities: | | | | | | | | | | | |
| Purchases of minority interests and investments | | | | -- | | | (16,943 | ) | | -- | |
| Proceeds from dispositions of businesses | | | | 43,257 | | | 48,000 | | | -- | |
| Proceeds from sale of equity investments | | | | -- | | | 14,538 | | | -- | |
| Purchases of marketable securities | | | | (22,932 | ) | | (10,700 | ) | | (4,635) | |
| Sales and maturities of marketable securities | | | | 25,099 | | | 4,775 | | | 12,811 | |
| Proceeds from sale of assets | | | | 144 | | | 2,640 | | | 848 | |
| Additions to property and equipment | | | | (22,093 | ) | | (13,377 | ) | | (16,159 | ) |
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| Net cash provided by (used in) investing activities | | | | 23,475 | | | 28,933 | | | (7,135 | ) |
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| Cash flows from financing activities: | | | | | | | | | | | |
| Repayments of long-term debt | | | | -- | | | (138,736 | ) | | (113,000 | ) |
| Repayments of capital lease obligations | | | | (516 | ) | | (1,962 | ) | | (2,369 | ) |
| Proceeds from exercise of stock options | | | | 5,662 | | | 27,343 | | | 28,811 | |
| Distributions to minority interests | | | | -- | | | (1,060 | ) | | (5,097 | ) |
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| Net cash provided by (used in) financing activities | | | | 5,146 | | | (114,415 | ) | | (91,655 | ) |
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| Effect of exchange rate changes on cash and cash equivalents | | | | (318 | ) | | (466 | ) | | 791 | |
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| Net (decrease) increase in cash and cash equivalents | | | | (93,398 | ) | | 301,169 | | | (92,902 | ) |
| Cash and cash equivalents at beginning of period | | | | 558,529 | | | 257,360 | | | 350,262 | |
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| Cash and cash equivalents at end of period | | | $ | 465,131 | | $ | 558,529 | | $ | 257,360 | |
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| Supplemental disclosures of cash flow information: | | | | | | | | | | | |
| Cash paid for income taxes | | | $ | 93,643 | | $ | 5,421 | | $ | 12,235 | |
| Cash paid for interest | | | | 1,085 | | | 1,888 | | | 5,641 | |
For additional information please see Notes to Consolidated Financial Statements in Form-10K.
Additional Segment Revenue Information:
Publishing Revenue by Business Unit (in thousands):
| Three months ended
December 31,
| Change
| Full Year ended
December 31,
| Change
|
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| 2005
| 2004
| Dollars
| Percent
| 2005
| 2004
| Dollars
| Percent
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| Publishing Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| TV Guide magazine (1) | | | $ | 34,878 | | $ | 76,082 | | $ | (41,204 | ) | | (54.2 | )% | $ | 229,580 | | $ | 321,153 | | $ | (91,573 | ) | | (28.5 | )% |
| TV Guide Online | | | | 2,223 | | | 1,808 | | | 415 | | | 23.0 | % | | 8,006 | | | 6,366 | | | 1,640 | | | 25.8 | % |
| Other | | | | 202 | | | 93 | | | 109 | | | 117.2 | % | | 314 | | | 361 | | | (47 | ) | | (13.0 | )% |
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| Total | | | $ | 37,303 | | $ | 77,983 | | $ | (40,680 | ) | | (52.2 | )% | $ | 237,900 | | $ | 327,880 | | $ | (89,980 | ) | | (27.4 | )% |
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(1) TV Guide magazine revenues are reported net of rack costs, retail display allowances, distribution fees and initial placement order (“IPO”) fees. IPO fees are initial fees paid to retailers for front end display pocket space at check out counters.
Cable and Satellite Revenue by Business Unit(in thousands):
| Three months ended
December 31,
| Change
| Full Year ended
December 31,
| Change
|
|---|
| 2005
| 2004
| Dollars
| Percent
| 2005
| 2004
| Dollars
| Percent
|
|---|
| Cable and Satellite Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| TV Guide Channel | | | $ | 30,914 | | $ | 32,072 | | $ | (1,158 | ) | | (3.6 | )% | $ | 124,064 | | $ | 117,258 | | $ | 6,806 | | | 5.8 | % |
| TV Guide Interactive | | | | 25,060 | | | 20,884 | | | 4,176 | | | 20.0 | % | | 96,115 | | | 74,705 | | | 21,410 | | | 28.7 | % |
| TV Guide Network | | | | 13,831 | | | 11,311 | | | 2,520 | | | 22.3 | % | | 51,552 | | | 38,985 | | | 12,567 | | | 32.2 | % |
| TV Guide Spot | | | | 34 | | | - | | | 34 | | | - | | | 82 | | | - | | | 82 | | | - | |
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| Total | | | $ | 69,839 | | $ | 64,267 | | $ | 5,572 | | | 8.7 | % | $ | 271,813 | | $ | 230,948 | | $ | 40,865 | | | 17.7 | % |
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| Three months ended
December 31,
| Change
| Full Year ended
December 31,
| Change
|
|---|
| 2005
| 2004
| Dollars
| Percent
| 2005
| 2004
| Dollars
| Percent
|
|---|
| Consumer Electronic Segment: | | | | | | | | | | | | | | | | | | | | | | | | | | |
| VCR Plus+ | | | $ | 9,238 | | $ | 11,188 | | $ | (1,950 | ) | | (17.4 | )% | $ | 42,375 | | $ | 51,531 | | $ | (9,156 | ) | | (17.8 | )% |
| CE IPG | | | | 11,310 | | | 8,921 | | | 2,389 | | | 26.8 | % | | 43,057 | | | 48,789 | | | (5,732 | ) | | (11.7 | )% |
| DBS | | | | - | | | 280 | | | (280 | ) | | (100.0 | )% | | 693 | | | 9,719 | | | (9,026 | ) | | (92.9 | )% |
| Other | | | | 1,678 | | | 2,202 | | | (524 | ) | | (23.8 | )% | | 8,354 | | | 7,502 | | | 852 | | | 11.4 | % |
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| Total | | | $ | 22,226 | | $ | 22,591 | | $ | (365 | ) | | (1.6 | )% | $ | 94,479 | | $ | 117,541 | | $ | (23,062 | ) | | (19.6 | )% |
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Additional Segment Operating Statistics:
Publishing Segment Operating Statistics:
| Q4, 2005
(in thousands) | Q4, 2004
| 2005
| 2004
| 2003
|
|---|
| | | | (in thousands) | |
|---|
| TV Guide magazine circulation (1): | | | | | | | | | | | |
| Newsstand (2) | | 401 | | 349 | | 330 | | 450 | | 660 | |
| Subscriptions | | 4,575 | | 5,708 | | 5,486 | | 5,779 | | 5,422 | |
| Sponsored/arrears | | 604 | | 2,996 | | 2,408 | | 2,780 | | 2,933 | |
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| | | 5,580 | | 9,053 | | 8,224 | | 9,009 | | 9,015 | |
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(1) Average weekly circulation for the quarter and year ending December 31, 2005. 2005 includes 11 weeks of the new full-sized TV Guide magazine.
(2) Current period numbers include an estimate for returns. Prior period numbers are restated to reflect actual returns.
Cable and Satellite Segment Operating Statistics
| As of 12/31/2005
| As of 12/31/2004
| As of 12/31/2003
|
|---|
| (in thousands) |
|---|
| Subscriber Data (in thousands) (1) | | |
|---|
| TV Guide Channel | | 77,353 | | 76,667 | | 57,091 | |
| TVG Network | | 18,000 | | 14,300 | | 12,300 | |
| Cable and Satellite Technology Licenses | | 39,372 | | 32,659 | | 11,456 | |
(1) Subscriber data represents:
| | • | Nielsen households for TV Guide Channel |
| | • | Households for TVG Network are based primarily on information provided by distributors |
| | • | Cable and Satellite Technology Licenses for which we are paid, as reported by domestic cable and satellite distributors that provided their subscribers either our IPG or another party’s IPG provided under a patent license from the Company. |
