-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Kvw1OR3LKWRKbx+mZ7OljocyLskErKIUNYWmdBPmBumVO42+il5LWisDVM21yTgy GJeZ1HVQ0PNWA3ly39ZWgw== 0000950128-99-000881.txt : 19990805 0000950128-99-000881.hdr.sgml : 19990805 ACCESSION NUMBER: 0000950128-99-000881 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19990804 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990804 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CBS CORP CENTRAL INDEX KEY: 0000106413 STANDARD INDUSTRIAL CLASSIFICATION: TELEVISION BROADCASTING STATIONS [4833] IRS NUMBER: 250877540 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-00977 FILM NUMBER: 99677268 BUSINESS ADDRESS: STREET 1: 51 WEST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2129754321 MAIL ADDRESS: STREET 1: 51 WEST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10019 FORMER COMPANY: FORMER CONFORMED NAME: WESTINGHOUSE ELECTRIC CORP DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: WESTINGHOUSE ELECTRIC & MANUFACTURING CO DATE OF NAME CHANGE: 19710510 8-K 1 FORM 8-K 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549-1004 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): August 4, 1999 Commission file number 1-977 CBS CORPORATION ---------------------------- (Exact name of registrant as specified in its charter) PENNSYLVANIA 25-0877540 ------------ ---------- (State or other jurisdiction (I.R.S. Employer of incorporation) Identification Number) 51 West 52nd Street, New York, NY 10019 --------------------------------------- (Address of principal executive offices; zip code) (212) 975-4321 -------------- (Registrant's Telephone No., including area code) 2 Item 5. Other Events ------------ On August 2 1999, the Registrant issued a press release concerning earnings for the quarter and year-to-date ended June 30, 1999. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein. A copy of the Condensed Consolidated Statement of Income for the quarter and year-to-date ended June 30, 1999 and 1998 is attached hereto as Exhibit 99.2 and is incorporated herein in its entirety. A copy of the segment information for the quarter and year-to-date ended June 30, 1999 and 1998, is attached hereto as Exhibit 99.3 and incorporated herein in its entirety. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits ------------------------------------------------------------------ (c) Exhibits Exhibit No. 99.1 Press release concerning earnings of the Registrant for the quarter and year-to-date ended June 30, 1999 is filed as Exhibit 99.1 to this Report. 99.2 Condensed Consolidated Statement of Income for the quarter and year-to-date ended June 30, 1999, is filed as Exhibit 99.2 to this report. 99.3 Segment Results for the quarter and year-to-date ended June 30, 1999, is filed as Exhibit 99.3 to this Report. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CBS CORPORATION (Registrant) By: /s/ ROBERT G. FREEDLINE -------------------------------- Robert G. Freedline Vice President and Controller Date: August 4, 1999 3 EXHIBIT INDEX Exhibit No. Description Sequential Page No. - ----------- ----------- ------------------- 99.1 Press Release 99.2 Condensed Consolidated Statement of Income for the quarter year-to-date ended June 30, 1999 and 1998. 99.3 Segment Results for the quarter year-to-date ended June 30, 1999 and 1998. EX-99.1 2 RECORD RESULTS FOR SECOND QUARTER 1 Exhibit 99.1 CBS CORPORATION REPORTS RECORD RESULTS FOR SECOND QUARTER 1999 PROFIT GROWTH UP DRAMATICALLY FOR ALL OPERATING SEGMENTS NET REVENUES UP 13% OPERATING CASH FLOW UP 55% AFTER TAX CASH FLOW UP 55% EARNINGS PER SHARE OF $0.13 UP FROM $0.01 LAST YEAR NEW YORK, August 2, 1999 -- CBS Corporation (NYSE: CBS) today reported record operating results for the second quarter of 1999. RESULTS FOR THE SECOND QUARTER OF 1999 Net revenues for the second quarter were $1,678 million, as compared to $1,484 million for the second quarter of 1998, an increase of approximately 13%. The increase was due to revenue growth at the Company's television segment, at its out-of-home media subsidiary, Infinity Broadcasting Corporation (NYSE: INF), and at its cable segment, which had strong sales growth at its country lifestyle cable channels. Operating cash flow (defined as earnings before interest, taxes, depreciation and amortization, excluding special items, or EBITDA) for the second quarter of 1999 was $427 million, as compared to $275 million for the second quarter of 1998, an increase of approximately 55%. The increase in operating cash flow was driven by a record increase of 81% at the television segment. The Company's cable and Infinity segments also had record operating cash flow growth of 40% and 34% respectively during the second quarter. The increase in operating cash flow was due to revenue growth at the Company's television and cable segments, coupled with lower programming and operating costs, along with record revenue increases at Infinity. "I am very pleased with the Company's record operating performance," said Mel Karmazin, President and Chief Executive Officer, CBS Corporation. "The gains made in our television segment were dramatic, with EBITDA growth of 81% during the quarter, and the first Network prime time win in five years. Our country lifestyle cable networks also had double digit operating cash flow growth. And once again Infinity paced the Company with record performance across the board. During the quarter, we announced acquisitions in virtually all operating areas of the Company -- in television stations, the Internet, outdoor advertising and syndication. We believe these new investments will create significant value at both CBS and Infinity in the years ahead." (More) 2 CBS Corporation...2 Net interest expense for the second quarter of 1999 was $46 million, as compared to $85 million in 1998's second quarter, a decrease of approximately 46%. This decrease was principally due to the lower debt levels as a result of proceeds received from Infinity's initial public offering in late 1998, proceeds from business dispositions, and strong cash flow from operations. Income taxes for the second quarter of 1999 were $130 million, as compared to $48 million for the second quarter of 1998, an increase of $82 million or approximately 171%. The increase is principally due to higher operating results. The Company's income from continuing operations for the second quarter of 1999, which includes certain special items discussed below, was $78 million, or $.11 per diluted share, as compared to $4 million for the second quarter of 1998, or $0.01 per diluted share, an increase of $74 million. The Company's reported net income for the quarter was $95 million, or $0.13 per diluted share, as compared to net income for the year-ago quarter of $4 million, or $0.01 per diluted share. The second quarter of 1999 includes a net gain of $18 million after tax on the disposal of certain discontinued operations discussed below. After tax cash flow (defined as income from continuing operations plus depreciation and amortization, as adjusted for minority interests) for the second quarter of 1999 was $217 million, as compared to $140 million for the second quarter of 1998, an increase of $77 million, or approximately 55%. However, as a result of the Company's substantial deferred tax position, after tax cash flow adjusted for cash taxes only was $331 million, an increase of $149 million or 82% from the second quarter of 1998. Acquisitions announced in the second quarter include: o Infinity Broadcasting Corporation entered into a definitive agreement by which Infinity will acquire Outdoor Systems, Inc. for approximately $8.7 billion, which includes the assumption of approximately $1.9 billion of debt; o The Company announced an agreement to acquire King World Productions, Inc. for $2.5 billion in common stock, adding the leading supplier of first-run syndicated programming to the Company's array of media assets; o CBS entered into definitive agreements to purchase KTVT-TV, the Network's affiliated station in Dallas-Ft. Worth, the nation's #7 market, and KEYE-TV, the Network's affiliate in Austin, Texas, in exchange for $485 million of CBS common stock and $160 million in cash, respectively. Both transactions are expected to close by the end of the year. Combined, the acquisitions will raise CBS's ownership position to television stations serving 34% of the United States; (More) 3 CBS Corporation...3 o The Company continued its Internet expansion, with numerous announced promotion- for-equity swaps, including: a 50% stake in e-commerce site storeRunner.com; 33.3% of office.com, an online business service; 35% of Switchboard.com, an online directory for personal and business use; and 30% of ThirdAge.com, a site for the 45-64 demographic. The Company also signed a letter of intent for a similar promotion/equity arrangement with hollywood.com, an entertainment Internet destination. o More recently, CBS Corporation announced that it had signed definitive agreements to exchange promotion and advertising for a 35% interest in Medscape, Inc., which will produce a new consumer health site, CBS.Medscape.com, and a 20% interest in Rx.com, an online pharmacy. During the quarter, the Company's operating profit benefitted by $24 million resulting from the reduction in the need for certain restructuring charges previously recorded for the television segment, due to second-quarter 1999 changes in programming decisions and higher voluntary employee terminations. In addition, other income and expenses includes a $24 million provision for losses associated with the Company's indemnification of certain obligations that were assumed by the buyer in the sale of a majority stake in a previously divested cable unit. In addition, the Company also realized an $18 million after-tax gain on the disposal of discontinued operations, or $0.02 per diluted share, associated with the divestiture of former Westinghouse Electric Corporation businesses which were sold to Bechtel National, Inc. RESULTS FOR THE SIX MONTHS ENDED JUNE 30, 1999 Net revenues for the six months ended June 30, 1999 were $3,446 million, as compared to $3,433 million for the six months ended June 30, 1998. Excluding the revenues associated with the 1998 Winter Olympics, net revenues for the six months ended June 30, 1999 increased by approximately 16%. Revenue increases were driven by industry-leading performance at Infinity, which experienced strong revenue growth of 36% during the first half. The Company's 1999 results also reflect the inclusion of operations of American Radio Systems (ARS) stations, which were acquired in June 1998. Excluding the effect of the Olympics and certain cable divestitures which occurred late in 1998, revenue growth was strong at the television and cable segments as well. EBITDA for the six months ended June 30, 1999 was $699 million, as compared to $546 million for the six months ended June 30, 1998, an increase of 28%. The increase in EBITDA was due to strong revenue performance, and the television and cable segments benefitted from cost containment efforts implemented during the prior year. Last year's EBITDA reflected a benefit associated with the 1998 Winter Olympics. Excluding the effect of the Olympics, EBITDA for the six months ended June 30, 1999, would have increased by approximately 53% over last year's first half. (More) 4 CBS Corporation...4 Net interest expense for the six months ended June 30, 1999, was $97 million, as compared to $160 million in 1998's first half, a decrease of approximately 39%. This decrease was principally due to the lower debt levels as a result of proceeds received from Infinity's initial public offering in late 1998, proceeds from business dispositions, and strong cash flow from operations. Income taxes for the six months ended June 30, 1999 were $176 million, as compared to $95 million for the six months ended June 30, 1998, an increase of $81 million or 85%. The increase is principally due to higher operating results. Income from continuing operations for the six months ended June 30, 1999 was $103 million, or $0.15 per diluted share, as compared to $23 million, for the six months ended June 30, 1998, or $0.03 per diluted share, an increase of $80 million. The Company's reported net income for the six months ended June 30, 1999 was $482 million, or $0.68 per diluted share, which includes a net gain on the disposal of the discontinued operations discussed above, as well as the disposal of the former Westinghouse Electric Corporation businesses reported in the first quarter of 1999. Net income for the first half of 1998 was $23 million, or $0.03 per diluted share. After tax cash flow for the six months ended June 30, 1999 was $377 million, as compared to $289 million for the first half of 1998, an increase of $88 million, or approximately 30%. After tax cash flow adjusted for cash taxes only was $526 million for the six months ended June 30, 1999, an increase of $154 million or 41% from the first half of 1998. Pursuant to a previously authorized $3 billion stock buyback program, the Company to date has purchased almost 39 million shares of its common stock at a cost of approximately $1.3 billion. CBS Corporation, the world's largest pure-play media company, is composed of CBS Television, Cable and a majority stake of Infinity Broadcasting Corporation, its out-of-home media subsidiary. CBS Television is comprised of the CBS Television Network and 14 CBS owned television stations, seven of which are in the Top 10 markets. CBS Cable consists of two country networks and regional sports operations. Infinity Broadcasting Corporation operates 163 radio stations and TDI, the Company's outdoor business. Infinity recently entered into an agreement to acquire Outdoor Systems, Inc. Note: Certain statements in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of CBS to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Reference is made to the Company's Annual Report on Form 10-K for the 1998 year and subsequent reports filed with the Securities and Exchange Commission for additional information concerning such risks and uncertainties. * * * Contacts: Gil Schwartz CBS Corporation 212/975-2121 Michael G. Silver CBS Corporation 212/975-3161 EX-99.2 3 EARNINGS INFORMATION FOR SECOND QUARTER 1 Exhibit 99.2 CBS CORPORATION EARNINGS INFORMATION SECOND QUARTER (UNAUDITED)
(in millions except per share data) Three Months Ended Six Months Ended June 30 June 30 ---------------------- ---------------------- 1999 1998 1999 1998 ---------------------- ---------------------- Revenues $ 1,678 $ 1,484 $ 3,446 $ 3,433 Operating expenses (1,187) (1,183) (2,648) (2,828) Depreciation and amortization (152) (136) (301) (266) Residual costs of discontinued businesses (45) (38) (85) (76) ------- ------- ------- ------- Operating costs and expenses (1,384) (1,357) (3,034) (3,170) ------- ------- ------- ------- Operating profit 294 127 412 263 Other income and expenses, net (19) 12 (6) 17 Interest expense, net (46) (85) (97) (160) ------- ------- ------- ------- Income from Continuing Operations before income tax and minority interest in income of consolidated subsidiaries 229 54 309 120 Income tax expense (130) (48) (176) (95) Minority interest in income of consolidated subsidiaries (21) (2) (30) (2) ------- ------- ------- ------- Income from Continuing Operations 78 4 103 23 Discontinued Operations, net of income taxes: Gain on disposal of Discontinued Operations 18 -- 384 -- Extraordinary item: Loss on early extinguishment of debt (1) -- (5) -- ------- ------- ------- ------- Net income applicable to common stock $ 95 $ 4 $ 482 $ 23 ======= ======= ======= ======= Average shares outstanding - basic 696 701 694 700 Average shares outstanding - diluted 713 721 710 719 Basic earnings (loss) per common share: Continuing Operations $ 0.11 $ 0.01 $ 0.15 $ 0.03 Discontinued Operations $ 0.03 $ 0.00 $ 0.55 $ 0.00 Extraordinary item $ 0.00 $ 0.00 ($ 0.01) $ 0.00 ------- ------- ------- ------- Basic earnings per common share $ 0.14 $ 0.01 $ 0.69 $ 0.03 ======= ======= ======= ======= Diluted earnings (loss) per common share: Continuing Operations $ 0.11 $ 0.01 $ 0.15 $ 0.03 Discontinued Operations $ 0.02 $ 0.00 $ 0.54 $ 0.00 Extraordinary item $ 0.00 $ 0.00 ($ 0.01) $ 0.00 ------- ------- ------- ------- Diluted earnings per common share $ 0.13 $ 0.01 $ 0.68 $ 0.03 ======= ======= ======= =======
EX-99.3 4 SEGMENT INFORMATION 1 Exhibit 99.3 CBS CORPORATION SEGMENT INFORMATION ($ in millions)(unaudited)
Three Months Ended Six Months Ended June 30 June 30 ---------------------------------- ----------------------------------- 1999 1998 % Change 1999 1998 % Change ---- ---- -------- ---- ---- -------- TOTAL CONTINUING OPERATIONS Sales $ 1,678 $ 1,484 13.1% $ 3,446 $ 3,433 0.4% Operating Profit (Loss) 294 127 131.5% 412 263 56.7% OP (Loss) without Special Items 270 127 112.6% 388 263 47.5% EBITDA 427 275 55.3% 707 546 29.5% EBITDA without Special Items 427 275 55.3% 699 546 28.0% INFINITY Sales 597 456 30.9% 1,071 786 36.3% Operating Profit (Loss) 191 141 35.5% 289 205 41.0% OP (Loss) without Special Items 191 141 35.5% 289 205 41.0% EBITDA 265 198 33.8% 435 311 39.9% EBITDA without Special Items 265 198 33.8% 435 311 39.9% TELEVISION Sales 927 880 5.3% 2,092 2,375 -11.9% Operating Profit (Loss) 119 21 466.7% 167 144 16.0% OP (Loss) without Special Items 95 21 352.4% 143 144 -0.7% EBITDA 174 83 109.6% 277 266 4.1% EBITDA without Special Items 150 83 80.7% 253 266 -4.9% CABLE Sales 156 150 4.0% 286 275 4.0% Operating Profit (Loss) 44 24 83.3% 69 28 146.4% OP (Loss) without Special Items 44 24 83.3% 69 28 146.4% EBITDA 46 50 -8.0% 96 79 21.5% EBITDA without Special Items 70 50 40.0% 120 79 51.9% CORPORATE & OTHER Sales (2) (2) - (3) (3) - Operating Profit (Loss) (15) (21) 28.6% (28) (38) 26.3% OP (Loss) without Special Items (15) (21) 28.6% (28) (38) 26.3% EBITDA (13) (18) 27.8% (16) (34) 52.9% EBITDA without Special Items (13) (18) 27.8% (24) (34) 29.4% RESIDUAL COSTS OF DISCONTINUED BUSINESSES Sales - - N/A - - N/A Operating Profit (Loss) (45) (38) -18.4% (85) (76) -11.8% OP (Loss) without Special Items (45) (38) -18.4% (85) (76) -11.8% EBITDA (45) (38) -18.4% (85) (76) -11.8% EBITDA without Special Items (45) (38) -18.4% (85) (76) -11.8%
SPECIAL ITEMS INCLUDE: Three Months Ended June 30, 1999 -------------------------------- - $24 reduction for certain restructuring charges previously recorded for the television segment - $24 provision for losses associated with a cable unit Six Months Ended June 30, 1999 ------------------------------ - Corporate & Other includes an $8 gain on the sale of an airplane recorded during the first quarter of 1999 -----END PRIVACY-ENHANCED MESSAGE-----